Emails: Company works to protect camera use

CEDAR RAPIDS - An automated traffic camera company that collects millions of dollars from lawbreaking motorists worked behind the scenes to support opposition to laws that would hamper use of its technology, according to emails obtained through an open records request.

A lobbyist was hired last year by Beverly, Mass.-based Gatso USA as policy threats - such as the Iowa Department of Transportation work on new administrative rules - picked up.

As Iowa considered its first statewide rules governing traffic cameras, Gatso - which runs camera programs in Cedar Rapids, Muscatine and Des Moines - drafted talking points for Cedar Rapids Police Chief Wayne Jerman to lobby transportation leaders the day before they'd vote on the rules last December, the emails show.

'While I believe it is unlikely that the (Iowa Transportation) Commission will stop the rules, I also believe it is important that we reach out to three of our client cities and ask them to voice some concerns to the Commissioner from their area,” Gatso lobbyist Mike St. Clair wrote in a Dec. 9, 2013, email.

The DOT's administrative rules raised the bar for having camera programs. Among the rules, cameras are to be a last resort, not a long-term solution, cities must justify them annually, and cameras can't be within 1,000 feet of a speed limit change. The last rule put three Cedar Rapids cameras out of compliance

Iowa, which had no traffic cameras rules until this year, has been a lucrative market for companies such as Gatso, which has earned more than $11 million since 2010, mostly from Cedar Rapids. The cameras could be in jeopardy due to the DOT's new, stiffer rules and a federal class action lawsuit.

The emails also shed light on the financial stake for Gatso, whose actions are not illegal nor unusual for large companies, and the city of Cedar Rapids.

In one series of emails in May 2014, officials from Gatso and Cedar Rapids negotiated back and forth over missed revenue from a camera outage a year earlier.

The current contract, which runs through 2016, pays Gatso about 40 percent of ticket proceeds. Tickets start at $75.

Cedar Rapids police Sgt. Mike Wallerstedt said he noticed a sharp decline in tickets issued at an Interstate 380 camera at Diagonal Drive in the middle of 2013. Upon investigation, Gatso officials realized it hadn't detected a camera above one lane had been off for 140 days.

Gatso offered $55,948.20 for the lost revenue based on a complex formula of expected tickets, payment rates and violation severity. Cedar Rapids contested the amount, noting Gatso based the calculation on a $65 ticket instead of $75.

Gatso responded with an offer of $73,068.35, but Cedar Rapids challenged again, this time noting city collection efforts weren't counted.

The sides eventually settled on $84,014.98, along with a legal agreement Cedar Rapids wouldn't sue or end the contract over the matter.

Racecar tool

Gatso started as Gatsometer in Europe in 1958.

Maurice Gatsonides, a Dutch racecar driver who won the 1953 Monte Carlo, founded the company after inventing the Gatsometer, which was 'the first reliable speed-measuring device in the world,” according to the company website.

Gatsonides created the technology to gain a competitive advantage, but it quickly gained traction for traffic enforcement.

In the 1960s, Gatsonides built a speed camera and later a device that snapped a picture at intersections when drivers ran through red lights. By the mid-1960s the devices were being sold in the Netherlands, Luxemburg and South Africa, and the company expanded around the world over time, according to the website.

In 2007, Gatso USA was launched to run its American market. By 2009, Gatso emerged from a field of four that responded to a request for proposal in Cedar Rapids, which sought to improve safety in town and on the S-curve along Interstate 380.

Safety and revenue

For years, the debate over cameras has centered on whether they are about safety or simply a cash cow. In several states, the programs have been banned through referendums or political pressure.

While public officials in city hall and police departments most loudly challenged state rules, Gatso has been testing messages and encouraging its clients to speak out, according the emails disclosed by Cedar Rapids.

In the Dec. 9 email, lobbyist St. Clair sent Gatso USA President Andrew Noble 'message points” for his clients, which he thought would resonate with commissioners. Noble forwarded the email to Jerman, encouraging him to contact the commissioners named in the message.

The records request included no response from Jerman, who declined an interview, citing pending litigation. Jerman said through a spokeswoman, 'I don't believe any vendor has a role or should have a role in determining how a PD drafts policy.”

Gatso officials also did not respond to interview requests.

Gatso has paid St. Clair $65,717 to serve as its lobbyist the past two years, according to disclosures. Redflex Traffic Solutions, which operates Iowa's other camera programs in Sioux City, Council Bluffs and Davenport, has paid $168,818 for lobbying services since 2010, according to public information.

On Dec. 12, after the transportation commission adopted the rules, Mark Bedard of Gatso emailed officials across the state, including Cedar Rapids, to contact members of the Legislature's Administrative Rules Review Committee. The hope was the committee would block the new rules.

'They need to understand exactly what is at stake and how communities will be affected,” Bedard said.

The committee wouldn't take up the matter until February, which 'buys us some additional needed time to pursue legislative options,” he said.

An Iowa lawmaker who sat on the rules committee, said Gatso's presence was felt at meetings even though they didn't speak.

'They did have representation there,” said State Sen. Mark Chelgren, R-Ottumwa. 'It was almost like an attorney in the background where they could go consult if they had a question about information.”

It was concerning, although not unusual, he said.

'I would describe the role as collusion,” Chelgren said. 'You have these companies all around the country, all around the world, making tremendous amounts of money off of Iowa citizens, and so do police departments.”

The commission didn't block the rules, which were enacted on Feb. 12.