After tremendous frustration and debate, the city of Houston was obligated last year by an overwhelming majority of its voters to end its contract with red light camera manufacturer American Traffic Solutions (ATS) and permanently shut down the controversial cameras. ATS quickly brought suit against the city for breaching their contract which was scheduled to end in 2014. And now, after months of debates, the two sides have reached a settlement agreement in which the city could pay ATS more than $12 million in damages for breaching their agreement and removing the cameras.
If the Houston City Council approves the pending settlement agreement, the city will be forced to pay ATS $4.78 million up front, with a potential pay-out possibly rising to $12 million over the next three years. However, the city does not intend on spending valuable tax dollars to compensate ATS. Rather, the city currently plans on using funds from previously collected fines that are in escrow and the approximate $25 million the city is still owed in outstanding red light camera fines to pay the settlement. In return for the payments, ATS has agreed to immediately remove all of its cameras from Houston intersections.
The city’s legal department is currently urging the city council to approve the settlement, which took the opposing parties two mediations and weeks of negotiations to finalize. ATS general counsel and corporate secretary, George Hittner, elaborated on the settlement agreemennt, stating, “I think it’s in the best interest of both sides to put this matter behind them, and let’s move on.”