City of Winnipeg claims company billed more than $1 million for tows that didn't happen

The City of Winnipeg was billed for more than $1 million worth of tows that it says never happened.

But a report to the Mayor’s Executive Policy Committee (EPC) is recommending City Council approve a legal settlement with Tartan Towing for $446,250, less than half of the total.

Under the agreement, Tartan would pay $15,000 per month to start, with a promise to repay the settlement amount in two years.

The report says Tartan was providing courtesy tows based on three contracts between 2016 and 2021. The company was paid by the city on a per-tow basis, and employees or subcontractors were required to track each tow.

In January 2022, the Public Works Department launched a review of courtesy tows, done during the residential snow parking ban, to determine how the initial use of the automated license plate reading technology was working. That review found an “unreasonable discrepancy” between the number of parking tickets and tows. A subsequent probe of the contract work back to 2016 found a significant number of tows were invalid, and the city overpaid by $1.1 million.

Councillor Janice Lukes, a member of EPC, wants to know why the city is not going after all of the money.

“Furious, nonsense, it’s ridiculous,” said Lukes. “In my opinion, if you did a million dollars in illegal tows, you should be paying the million dollars back.”

The report says if council does not approve this the city can sue Tartan. It says if this goes to trial, it would cost the city money and time to litigate the case.

Lukes also wants to know why Tartan has not been suspended from doing business with the city in light of this, and why better oversight was not in place.

“We shouldn’t be hiring them again, really, we should be banning them,” said Lukes.

The report says Tartan provides the city with ongoing services. “The Public Service wishes to maintain a working relationship,” states the report.

It goes on to say Tartan let go of some of the drivers involved while others were cautioned.

“Tartan has issued a strong warning, to all current and future operators, of consequences as a result of any misuse or false reporting…” states the report.

The report also says the EPC has requested no subcontractors involved in the overbilling be used in the future and that Tartan explain steps it has taken to ensure subcontractors are not submitting false claims.

It also says there is now a system in place where Tartan sends a report on tows to the city, and the city now does reviews after courtesy tows are done.

According to a statement from the city, no claim that Tartan knowingly over-charged the city has been made.

It also notes the company will not be banned from bidding on city contracts in the future.

The EPC meets on Monday to discuss and vote on the settlement.

CTV News has reached out to Tartan Towing for comment.