Baltimore officials awarded $1.8 million in contracts for the city's lucrative towing business on Wednesday, ending a practice that had allowed a small circle of companies to bypass the city's competitive bidding system for decades.
City Councilman Robert W. Curran said the contracts approved Wednesday by the Board of Estimates mean some towing companies "will be losing significant percentages of their tows and conducting tows at reduced rates," a benefit for the city and its taxpayers.
He said the new contracts will "strike a further blow to predatory towing practices in Baltimore City."
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The contract covers crash scenes, parking violations and other incidents in which Baltimore police call for tows.
Frankford Towing and two subsidiaries each received $200,000 contracts, as did Berman's Towing and two of its spin-off companies. Ted's Towing Service, Mel's Towing & Service Center and Universal Towing also received $200,000 contracts.
City Solicitor George Nilson said the city will be advertising for additional towing firms within the next six months. The moves will end a system that has been in place since 1975.
During that time, the city has given the $4 million annual towing business to 10 "medallion" companies, which were not required to demonstrate that they were best equipped to provide the service or that they charged the lowest rates. The companies were also not held to the city's standards for minority participation.
After The Baltimore Sun investigated the practice last year, Mayor Stephanie Rawlings-Blake, then-Police Commissioner Frederick H. Bealefeld III and City Councilman James L. Kraft called for a review, and the transportation department issued a request for proposals for the towing contracts.
City budget director Andrew W. Kleine has said the city expects to save at least $1 million a year by awarding the contracts competitively
The medallion companies were victims in the city Police Department's kickback scandal, in which officers have pleaded guilty to accepting money from a Rosedale garage for steering towing business there instead of to the medallion towers.
But the scandal highlighted the long-standing practice of awarding contracts to the tow companies without competitive bids. Many of the existing contractors bid on the new contracts and several will continue to perform city jobs.
Companies will still charge $130 to $140 per tow for the Police Department, but under the new contracts, Curran said, the city will receive a larger portion of the fee.
Baltimore Sun reporter Julie Scharper contributed to this article.