How Does A $3 Toll Turn Into A $20 Rental Car Charge?

Image courtesy of MPD01605

Cashless payment systems like E-ZPass have helped make highway driving a less irksome experience by speeding up lines. Rental car companies even offer this option so you don’t have to worry about an embarrassing last-minute scrounge for change at the tollbooth, but rental car customers are now realizing that this convenience can come at a huge price.

We’ve previously told you about some of the steep fees involved in using a rental company’s toll-paying device, but those fees could be small change compared to penalties for drivers who use the car’s device without even realizing it.

The Pew’s Stateline recently took a look at how the convenience of cashless toll roads has turned into a cash machine of sorts for rental car companies, while draining the pockets of their customers.

How Does It Work?

• You rent a vehicle from your favorite car rental company.
• The car you receive is equipped with a transponder that detects when the vehicle passes under an electronic toll.
• While driving through a designated toll lane, the transponder records the toll, adding the charge to your bill.

While that sounds innocent enough — you use a toll road, you pay the toll — lawmakers and consumer advocates say there’s more to it.

Many rental car companies will charge convenience, administrative, or service fees for this toll service, turning a hypothetical $1.50 toll to a more than $20 charge on your bill.

Stateline reports that rental company’s fees for these services vary depending on how the company handles the service — for example, if they contract with a third-party, the fees could be more — and how it is presented to a customer.

For instance, an Avis customer driving on Maryland’s Intercounty Connector might be charged $3.95 in fees after going through a $2.11 toll, Stateline reports, adding that the fees don’t stop there. Once the customer goes through the toll, the customer will continue to pay the $3.95 fee each day they have the car.

Most car companies cap these fees, Stateline reports. Hertz, for example, limits toll rental fees to $24.75, while Avis caps its fees at $19.75/month.

In the case where a customer opts out of a tolling option, Hertz subsidiaries Dollar and Thrifty will charge drivers as much as $90 if they trigger electronic tolls during the course of their travels, Stateline reports.

This is all too much, according to lawmakers and advocates who have begun to file complaints against companies charging the fees.

Clear and Transparent

Back in March, the city of San Francisco sued Hertz for allegedly gouging tourists by fraudulently charging them millions of dollars in extra fees when they drive over the Golden Gate Bridge.

According to the suit [PDF], Hertz offers customers an automatic toll-paying service called PlatePass that they can use on California’s toll bridges, or just pay cash. But paying cash isn’t an option on the bridge, where motorists can use a FasTrak toll tag, or pay online, in person, or by phone after their car has gone through.

The lawsuit claims that Hertz doesn’t tell customers about these other options and instead, once they drive over the bridge, PlatePass is triggered. Hertz customers are charged an undiscounted toll rate of $7.50, the city says, as well as a $4.95 “convenience fee.”

But they often aren’t charged that fee once, according to the complaint, and instead can be hit repeatedly by that fee for up to $24.75.

San Francisco isn’t the only municipality or governing body to take on toll fees.

Stateline reports that earlier this year the Florida attorney general agreed to a settlement with Avis, along with its subsidiaries Budget Car Rental and Payless Car Rental. Under the agreement, the companies must disclose their fees on their websites and at service counters, and inform customers they can forgo the company’s tolling system by using their own transponders or avoid toll roads altogether.

Other Options

Renters also have other options when it comes to paying for tolls. However, Stateline notes, these options might not be clear to customers.

Some states allow drivers to pay for fees in advance online, while in others it is perfectly legal to use your own transponder in a rental car, as long as that car has been added to the customers’ account.

Stateline notes, however, that this option doesn’t work everywhere, as the tolling systems vary by state. This, despite, a five year old federal law [PDF] requiring states to begin implementing a single one-device system.