City Can’t Keep Impounded Cars After Drivers File for Bankruptcy: Court

Politics

City Can’t Keep Impounded Cars After Drivers File for Bankruptcy: Court

Nick Blumberg | July 8, 2019, 5:41 pm

A federal appeals court says Chicago can no longer continue to hold impounded vehicles of drivers in debt to the city after the vehicle owner files for bankruptcy. It’s all part of a complicated legal case related to a ProPublica and WBEZ investigation last year that found city ticketing policies put a huge burden on mostly low-income Chicagoans of color.

The court case hinges on Chapter 13 bankruptcy, writes reporter Melissa Sanchez of ProPublica Illinois. “This kind of bankruptcy allows for ticket debt forgiveness and what’s known as an ‘automatic stay,’ a protection that gives debtors the opportunity to regain their financial footing and repay their creditors. For years, what that meant for indebted motorists in Chicago was the ability to quickly reinstate drivers’ licenses suspended over unpaid tickets and retrieve impounded vehicles without having to first pay fines or fees,” Sanchez wrote.

But in 2017, the city started claiming it had liens on impounded vehicles and didn’t have to return them after drivers filed for bankruptcy. The federal court decision puts a halt to that practice, but further changes to Chicago’s ticketing policy are still unclear.