Chicago towing operations are managed by United Road Towing, a private contractor. In 2016, Chicago gave them a contract to handle that work, at the estimated cost of $60 million over five years. URT has held towing contracts with Chicago for the last 30 years (under the name Environmental Auto Removal until 2006), despite the fact that it’s dodged many scandals. In the ’90s, the company was found to have bilked the city for $1 million. It’s been probed by the FBI in an interstate auto-theft ring. It once declared bankruptcy to avoid paying a $5 million settlement after the company was found to be illegally towing cars in another state. In 2004, the Chicago Sun-Times investigated the company, finding that it and the city sold off more than 70,000 cars in one year.

Despite the bad rap, URT was tapped in 2010 to once again be the city’s towing contractor — even though it was not the cheapest bidder.

According to a 2010 request for proposal and bids made at the time, San Francisco-based Tegsco (aka AutoReturn) was willing to charge the city less per towed car than URT.

The city had never publicly released these bids before WBEZ spent months requesting them. A heavily-redacted, 77-page URT bid and a barely-redacted 647-page bid from Tegsco show key differences. Tegsco proposed charging the city $102 per towed car. URT redacted its fee proposal, but in 2010 it was eventually awarded a contract that charged $104.55 per tow.

Inquiries to Tegsco representatives were not returned.

Representatives from United Road Towing did not respond to months of inquiries from WBEZ concerning the city’s towing program and the towing contract.

The city, however, defends the URT contract.

In a joint statement, Department of Streets and Sanitation and Department of Procurement Services said URT was the only qualified company: “URT was awarded the towing contract in 2010 as they demonstrated the ability to effectively manage the contract with a dedicated fleet of equipment, in addition to subcontracted equipment, and staff.”

The city maintained that Tegsco relied too heavily on subcontractors, even though URT relies on dozens of smaller towing companies.

The higher “per car” rate is not the only issue with the current URT contract. The company’s real windfall comes in the form of junkable or sellable cars, because the contract essentially lets the company keep many cars that owners don’t reclaim from city auto pounds.

Here’s how that works. In 2017, the city would pay URT $123.21 for tows involving road hazards, VIP tows, and tows from the snow ban. Car owners reclaimed most cars swept up in those programs. But for every boot-and-release tow in the scofflaw program, the city paid a lower rate — just $35.44 per tow. The city also got a $15 credit for every abandoned car taken off the streets; the company charges nothing for towing these cars. The lower rates are because of an expectation that thousands of cars involved in these kinds of tows will never be reclaimed, and that URT will take possession of them after paying the city nominal scrap prices.

The city spelled out this arrangement in the 2010 request for bid proposals, estimating that 31,530 cars would “be unclaimed Vehicles which transfer to Contractor for disposal in accordance with the Illinois Vehicle Code.”

In other words, Chicago has long known that it tows enough cars that it can pay the towing company with some of them, potentially lowering overall towing costs for the city.

The payoff for URT is huge. Of the 93,857 cars towed in 2017, residents did not (or could not) reclaim 32,155 of them. URT took possession of nearly 24,000 of the towed cars, paying the city just more than $4 million in scrap prices. But conservative estimates suggest the cars’ value was far higher.

We obtained vehicle identification numbers and the make, model and year of cars sold to URT in 2017. We then looked up similar cars’ values compiled by the National Automobile Dealers Association, which supplies car values in asset forfeiture cases, according to the Illinois State's Attorney Office. We assumed the cars were in rough condition and had been driven 15,000 miles for each year they were on the road — well over the national average of 12,000 miles per year.

NADA returned data suggesting that the low-value (rough) trade-in value of cars sold to URT in 2017 topped more than $22 million.

The city contends that this figure is high because these cars no longer have “clean titles.”

Marjani Williams, a Streets and Sanitation spokeswoman said, “trade-in values are not an accurate representation of the value of these vehicles because once transferred, they can only receive a Salvage Title or Junking Title, which significantly lowers the resale value.”

The office of the Illinois Secretary of State confirms these cars are issued salvage or junking certificates.

Cars to be sold back to the market receive a rebuilt title, which often (but not always) lowers a vehicle’s sale value by as much as half. Either way, the city is sending URT between $7 million and $18 million dollars in sellable cars. The contractual arrangement divvies tens of thousands of Chicagoans’ cars between the city and URT — the city gets scrap values, and URT gathers millions more in potential resale value. The remainder of the cars’ full value evaporates into bureaucratic thin air, because of the legal change in title when the car is not claimed from a city auto pound.

And these are not all junkers. Sales included: a 2016 Ford Mustang for $176.09, a 2014 Audi A3 for $147.15, and a 2011 Mercedes M-Class for $143.33.

Recall that when tens of thousands of cars are transferred to URT, the car owners receive nothing, and are likely stuck with ticket debt, in addition to boot, towing, and storage fees.