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Who profits from these cameras? The answer may surprise you
By Joseph Ryan and Dan Carden | Daily Herald Staff
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Published: 7/13/2009 12:02 AM

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If you land a $100 red-light ticket in the mail, the return address is likely to indicate the city where the camera was located.

But not all the money is going there.

Actually, the private camera companies that rent out the equipment can land nearly as much from the fines as the local government.

For example, in Roselle where two cameras are up at Lake Street and Gary Avenue, nearly $298,900 in fines was collected over nine months. Of that, $117,333 went to the camera company, RedSpeed, according to information culled from Freedom of Information requests by the Daily Herald as part of its Seeing Red investigative series.

Illinois law prevents a specific cut of the ticket from going to the camera company, so standard contracts require either monthly fees per camera or particular charges for services, including collecting and mailing the violations.

For example, a typical RedSpeed contract calls for a $1,499 fee per camera, per month. Then the company, which has offices Lombard but is based in England, charges the municipality $5.99 for every time it relays pictures of violations, retrieves motor vehicle registration information from the state, mails a letter, processes a payment, answers a violator's phone call and stores evidence.

In Bensenville that formula has been productive for RedSpeed. Over seven months, more than $140,000 in fines were collected largely from three cameras and $89,639 went to the company.

Other companies simply charge per-camera, per-month fees. Australia-based Redflex Traffic Systems typically charges $4,395 for each camera, every month.

Most, if not all, contracts in Illinois have a clause that ensures the municipality won't owe the camera company any out-of-packet cash. So even if the violations are too low to pay the monthly fee, the camera company won't charge the taxpayers.

That has been good news for some suburbs.

In Rosemont, which has two of three cameras making a profit, village officials say a camera at the intersection of Balmoral Avenue and River Road doesn't generate enough tickets to provide for more money than owed RedSpeed.

The same appears to be true for St. Charles, where a camera at routes 64 and 31 issues only an average of 24 tickets a month. Right-turn violations are not ticketed at that intersection.

Still, while there are millions of dollars to be made off red-light tickets issued 24/7 from cameras, it remains unclear just how much some of the biggest companies are profiting.

RedSpeed, which has the most contracts in the suburbs, is a private company and therefore doesn't disclose revenue details. The parent company established a U.S. headquarters in Lombard "to respond to the specific needs of the U.S. enforcement market" in 2007, according to the company's Web site.

Meanwhile, Redflex, which has the most U.S. contracts, has a headquarters in Arizona but is actually a publicly-held Australian company based in South Melbourne. Redflex stock is traded on the Australian Stock Exchange.

In 2008, Redflex earned $8.4 million in profits on $70 million in revenue, a 25 percent increase in profits from 2007. Eighty percent of Redflex revenue is earned in the United States, according to the company's annual report. In that same report, CEO Graham Davie said Redflex plans to keep expanding in the United States.

Redflex has 30 red-light camera contracts in Illinois, including 140 cameras in Chicago. The only states with more Redflex contracts are California with 74 and Texas with 40.