Monday, December 22, 2014

"Reform" Legislation Allows Xerox to Lift Ban on "The O Word"

For years, speed camera contractors in Maryland justified so called "Bounty System" contracts which appeared to violate a prohibition in Maryland law by avoiding using the term "Operate" to describe what they do under speed camera contracts.  Now, after a minor change to state law passed year, it appears that speed camera contractors no longer feel bound to avoid using the term at all.

Under the old version of state law, the statute said "If a contractor operates a speed monitoring system on behalf of a local jurisdiction, the contractor’s fee may not be contingent on the number of citations issued or paid."   However speed camera contractors easily circumvented this prohibition by simply not using the term "operate" to describe what they do.  Speed camera contractors, following guidance from the Attorney General's office, religiously avoided using the term "operate" to describe the contractor's activities and used this semantic loophole to implement "Bounty System" contracts which paid fees contingent on the number of tickets issued.  Under such deals, the vendors received a payment based on the number of tickets issued and still maintained substantial control over the equipment and the processing of violations... so long as they religiously avoided using the WORD "operate" to describe what they did.  (Or as we said "Don't Use the O Word!")  The word "operate" was carefully scrubbed from all descriptions of what contractors did in most contracts and official correspondence, even though contractors in reality maintained substantial control over the deployment of machines, their calibration, and the processing of violations.

In 2014 (after even Governor O'Malley was forced to concede that the practice did not meet the intent of state law) a so called "reform" to the state's speed camera law reworded the prohibition.  The new wording:
If a contractor IN ANY MANNER operates a speed monitoring system OR ADMINISTERS OR PROCESSES CITATIONS GENERATED BY A SPEED MONITORING SYSTEM on behalf of a local jurisdiction, the contractor’s fee may not be contingent ON A PER–TICKET BASIS on the number of citations issued or paid
Xerox celebrates that they can once again "Use the 'O' Word" to describe what they do
was CLAIMED by supporters of Maryland's current speed camera law to "End the Bounty System".  However the language in this bill was written by representatives from some of Maryland's largest speed camera programs, who were determined to include deliberate loopholes to lock in their existing practices.  For example, the bill specifically grandfathered in all existing contracts (there were about three dozen separate local speed camera programs in the state using bounty system contracts), and even allowed new bounty system contracts to be locked in for several months before the bill went into effect.  In addition, using a subtle twisting of words only an attorney can fully appreciate, the addition of the words "ON A PER-TICKET BASIS" does not have the legal effect of creating a stronger prohibition, but rather it narrows the types of contracts which the prohibition applied to so that only those which explicitly pay a set dollar amount for a single ticket were prohibited, but exclude other types of arrangements which are based on ticket volume (now being referred to as 'hybrid contracts' and 'tiered systems').  Only a few "bounty system" speed camera contracts in the state have had their payment terms changed since the bill's passage... other than to extend the contract periods until 2017, most speed camera contracts in the state still pay their contractor based on the number of tickets.

However this dishonest "reform-in-name-only" legislation did change one thing: Since existing contracts have all been "grandfathered in", speed camera contractors no longer feel the need to maintain the ruse of avoiding the use of the term "operate" to describe what they do, since they need not worry about the issue being raised by ticket defendants in court.  Speed Camera Contractor Xerox Corporation recently updated their website to freely use "The O Word" in marketing to describe what they do.  heir website now reads "That’s why we install, operate and maintain customization, automated, photo-enforcement solutions, including red light, speed and school bus cameras." and "We specialize in operations—not just equipment. That means we can develop a customized solution that meets your operational and safety needs in a variety of areas. As an integrator, we unify the overall operation and provide a single point of contact with full responsibility for the program—making a complex safety solution simple to execute in your community."

This is what constitutes "reform" according to the Maryland legislature.