CEDAR RAPIDS — Thousands of people who had their state income taxes withheld last year to pay old automated traffic camera tickets would get refunds while tens of thousands more unpaid tickets would be waived under a proposed settlement of a class-action lawsuit.

The city of Cedar Rapids would refund $3 million to settle a January 2018 lawsuit led by WHO-AM 1040 personality Simon Conway over a city collection effort launched days before Christmas two years ago.

City officials said they would no longer attempt to collect unpaid tickets issued before Aug. 31, 2018, under the automated camera program, which amounts to about 177,000 tickets.

“To avoid additional time and expense to all parties involved, the city recommends settling this before going to trial,” Finance Director Casey Drew told City Council members Tuesday.

The city does not admit wrongdoing in the settlement, and it has no bearing on the city’s current use of traffic cameras used to enforce speeding and red-light running violations at nine locations, including four on Interstate 380. The traffic cameras have prevailed over several constitutional challenges.

The council Tuesday unanimously approved the proposed terms of the settlement in the case of Conway and nine other plaintiffs vs. the city of Cedar Rapids and Municipal Collections of America. The parties are expected to file a court motion for preliminary approval of settlement terms Friday, at which point the settlement document could become public. Plaintiffs’s attorney Jim Larew declined to comment and Conway did not return messages.

The case stems from a December 2017 initiative in which the city attempted to seek payment for 221,000 unpaid tickets worth $17.3 million dating to the earliest days of the program in 2010.

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Some 45 percent of tickets issued — 154,323 in the last full year of ticketing before the cameras were temporarily turned off — were not being paid. In many cases, people ignored them.

Aside from the legal challenge and push back from people who received notices, the initiative proved to be a public-relations nightmare in the Iowa Capitol, where lawmakers criticized it in attempting — unsuccessfully — to ban traffic cameras as simply money making devices.

City and police officials say the cameras are a proven method of making roads safer.

Through the collection initiative, those who received a notice had a 45-day grace period to pay the original amount — typically $75.

After that, a 25 percent late fee was added and the debt was submitted to the Iowa Department of Administrative Services’ offset program, in which state income tax returns were withheld to settle the debt.

By the time the city closed the initiative in fall 2018, following a court ruling,, the city generated nearly $4 million, including $3.1 million from 35,000 fines collected from the offset program and $586,000 from 7,700 fines gathered by its collection agency, the city said in February.

Those who paid voluntarily in the initial 45-day window are not covered under the proposed settlement.

The settlement applies to 36,452 citations, or 20,090 class members, Drew said. These are people who had their debt settled involuntarily through the offset program and without admitting guilt. Anyone who paid a late fee would also be eligible for that amount to be refunded.

Those eligible for the settlement would be contacted through a third party on behalf of the city. If the court approves the settlement, the court would determine deadlines for receiving notices and timetables for refunds.

Legal fees and value of refunds would be outlined in the settlement agreement, according to the city.

The city is responsible for the full settlement amount, which will come from traffic camera revenue that had been set aside in case of a settlement, Drew said.

The plaintiffs had contended the notices exceeded a statute of limitations and challenged the imposition of a retroactive late fee.

The city appears to concede the point on statute of limitations, telling The Gazette on Tuesday it “can no longer pursue a court judgment due to the age of the debts.”

A key point in the settlement was the city’s process of determining guilt by default if a person ignored the ticket.

In the Myron Behm et al vs. City of Cedar Rapids et al court case, the Iowa Supreme Court opined this process ran afoul of Iowa Code, which requires municipal infraction proceedings so that a court assigned liability.

The city since has changed its ordinance to institute a municipal infraction process, but Drew said that was to eliminate grounds for disagreement rather than indicate the city’s process was flawed.

“This was a discussion and opinion by the court, but it was not binding,” said Greg Buelow, a Cedar Rapids public safety spokesman.

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Automated traffic camera enforcement was restored after a hiatus July 1 following a separate unsuccessful legal challenge. The city at this point does not include using the offset program to go after unpaid fines, but it is leaving that door open.

Traffic cameras are placed at nine locations in Cedar Rapids, plus there is one mobile radar. Four speed cameras are on I-380: where it crosses at J

Avenue NE and Diagonal Drive SW in the northbound lanes, and at J Avenue NE and First Avenue SW in the southbound lanes. Five cameras enforcing speed

and red-light violations are located in town: First Avenue and 10th Street NE, First Avenue and L Street SW, Williams Boulevard and 16th Avenue SW,

42nd Street and Edgewood Road NE and the intersection of Center Point Road and the Collins Road ramp (north side of Highway 100).

Comments: (319) 398-8310; brian.morelli@thegazette.com