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Scandal-ridden red light cameras offer potential corruption in Texas, elsewhere

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Though a federal investigation involving Redflex Traffic Systems, Inc., remains quiet, the issue of red light and other traffic cameras is still a hot topic in Texas. With that, one can only wonder the impact if the bribery and other public corruption allegations seen with Redflex and the city of Chicago might at a point similarly surface with any of the company’s municipal clients here in the Lone Star State.

In 2013, Redflex, one of two major players in the red light camera industry, admitted that its city of Chicago flagship program was based on a $2 million bribery scheme that included “providing government officials with lavish gifts and bribes.” The company reportedly terminated six top executives including Aaron Rosenberg, an executive vice president who was also the company’s top national salesman.

Upon the Phoenix-based company suing Rosenberg for damages, the former executive filed a counterclaim in which he disclosed providing information not only for a private investigation, but to local and federal investigators as well. Referring to himself as being made a “scapegoat,” Rosenberg described his actions as “carrying out orders” in a corporate culture that supported a “pattern and practice” of supplying potential clients with extravagant “entertainment” opportunities such as meals, golf outings, professional football and baseball games.

In January, the Chicago Tribune reported Rosenberg’s contention that during his tenure Redflex “bestowed gifts and bribes on company officials in dozens of municipalities within, but not limited to the following states: California, Washington, Arizona, New Mexico, Texas, Colorado, Massachusetts, North Carolina, Florida, New Jersey, Tennessee, Virginia and Georgia.”

So who are Redflex clients in Texas?

The city of Austin for one. Terming Redflex “where you can send your hate mail about that automated red light ticket you got in the mail,” The Austin Chronicle reported last summer of the company providing “another reason to be outraged about the privatization of law enforcement.”

Discussing the company’s contract and relationship with local city officials, the article included information from two Redflex letters sent in 2013 to Austin Police Department Lieutenant Troy Officer. A March letter signed by then-CEO Robert T. DeVincenzi acknowledged the Chicago situation, told of an internal investigation along with “a host of corrective matters taken by the company” and pledged commitment to rebuilding lost trust. In a second letter sent six weeks later, DeVincenzi announced both the internal investigation’s end and a continued commitment to cooperating with authorities as well as thanked clients for their support.

The Austin City Council approved the city’s Redflex deal in 2007. It began in 2008 and ran for an initial five years with options for an additional 10. In 2013, the first option was exercised by Austin Police Department administrative authority extending the contract through 2018 and, per the Chronicle, making the city “now on the hook for up to $9.7 million for the agreement.”

With news of the scandal, a Dallas Observer headline noted “Redflex, DFW’s Favorite Red Light Camera Company, Is Accused of Passing Bribes in Texas.” The article details that while Dallas contracts with Redflex competitor American Traffic Solutions, Richardson, Plano, Balch Springs, Coppell, Duncanville, Grand Prairie, Mesquite, Roanoke are among the known area Redflex users. Other cities include Corpus Christi, El Paso, Killeen, Marshall, North Richland Hills, Richland Hills, Round Rock and Socorro.

Interestingly, while many cities more so than residents remain far more enthusiastic over the use of red light cameras, this potentially lucrative revenue stream is not without its problems. First, the maximum allowable charge is $75 along with a $25 late payment fee for payments after 30 days.

Per a 2007 state law, red light revenues must be evenly split with the state. Cities are required to use proceeds for traffic improvements and public safety programs while the state must designate its funds received for trauma centers. The law additionally allows cities to retain funds for payment of administrative and maintenance costs (i.e., Redflex and other contractor fees) related to operating the traffic light systems.

That said, collections don’t seem to be going so well. In 2012, a joint Austin American-Statesman and KVUE News analysis found the city of Austin losing out on more than $800,000 in potential revenue as fines hadn’t been paid by nearly a quarter of violators.

This came after a 2011 Fort Worth Star-Telegram article which opened saying “millions of dollars in red-light tickets in Tarrant County are going unpaid, and cities haven’t been able to do much about it.”

Arlington was listed as having about $6.5 million in uncollected penalties while North Richland Hills’ outstanding revenue amounted to more than $1.49 million with Hurst, a smaller suburb, at $403,000.

Killeen, however, is one Texas city that has reported slight increases in its revenues.

But despite red light camera opponents and questionable revenue streams, Redflex and its main competitor, American Traffic Solutions Inc., appear willing to invest resources into securing business with additional Texas cities.

A 2010 Dallas Morning News article described the companies’ efforts to exert legislative and local influence:

In the power-driven world of Texas lobbying, red-light camera companies do not cast shadows as large as industries like housing and petroleum.

But with lots at stake, red-light camera firms have quietly established a Texas statehouse presence.

Arizona-based Redflex Traffic Systems Inc., one of the nation’s leading red-light camera companies, has spent as much as $230,000 on lobbying activities in Austin since 2007, state records show. Another leading company, American Traffic Solutions Inc., also based in Arizona, has spent up to $20,000.

Exact state figures are not available since dollar amounts are reported in ranges, but Redflex spent a minimum of $100,000.

Those amounts do not include money that the companies may have spent on lobbying efforts in cities such as College Station and Houston, which have grappled with local ballot initiatives related to red-light cameras.

Thanks to local city officials, red light cameras have undoubtedly found a place on many Texas city streets with Denton County now even studying photo radar ticketing as a new option.

The cameras welcomed status with residents though is not so clear. In addition to drivers resisting payment of red light tickets, citizens further taking action against efforts to bring cameras into their towns via petition drives, charter amendments and utilizing online activism like the website TrashYourTicket.com give evidence that red light cameras are far from a routinely accepted practice.

And look for that sentiment to grow if investigations suggest public corruption and other misconduct with regard to Redflex and its entry into the Texas market.

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