Red Light Camera Vendor Not Doing So Well With Public Opposition Driving Down Its Revenue

from the awww...-too-bad dept

There's been significant growing opposition to red light camera programs, which have a long history of showing absolutely no safety benefit, and are often run for-profit by local governments in combination with private companies. That opposition is leading more and more cities and towns to dump the red light cameras -- while some operators are getting caught illegally decreasing the time of the yellow or amber lights to try to issue more fines.

Jeff Nolan alerts us to the news that one of the biggest players in the space, Redflex, has announced that public opposition to its cameras has created a real drain on revenue, and its profits were down significantly. This would be the same Redflex that just so happened to fail to live up to its contract in Denver to deliver data that could be used to determine whether or not the cameras were really effective.

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  1. identicon
    fogbugzd, 14 Sep 2009 @ 9:51am

    Fines as revenue = Bad practice

    One thing I remember from an "economics of government" course years ago was the principle that fines are a poor revenue source. Fines should discourage behavior, so ideally income from fines should be zero.

    Still, fines as income is a very popular concept politically because the perception is that it is a way to make someone else, or some unpopular group, to pay faux-taxes. However, when fines are seen as a major revenue source the government will inevitably try to broaden the base of those paying fines, or they will begin over-enforcement of fine producing activities to the detriment of effective enforcement mechanisms.

    The effect is especially bad when the revenue goes to the ones enforcing policy. We had a classic example of this locally. Our "drug strike force" is financed mostly by drug seizures. The strike force announced that it was shifting more of its resources to "revenue generating" enforcement activities. This meant backing away from highly effective activities such as education and treatment programs. As it turned out, they were also watching drug transactions, and letting them pass if the purchaser was driving a clunker, but swooping in on anyone in a fancy car with good resale value.

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