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Red Ink Mounts At Redflex
Growing anti-photo enforcement movement will cost Redflex 12 percent of expected revenue this year.

Embattled photo ticketing provider Redflex Traffic Systems expects it will lose $12 million from legal changes in two states. The company earlier today announced to the Australian Securities Exchange that twelve percent of the firm's revenue stream has dried up because of increasing dissatisfaction with the concept of automated ticketing.

"Existing programs in several other states, including New Jersey and Ohio, where Redflex Traffic Systems Inc currently conducts business, face actual or potential legislative action that could restrict or impair the operation of photo-enforcement," the company told investors. "These changes affect all the companies in the photo-enforcement market in these states. Redflex Traffic Systems Inc has been active in working to inform both public opinion and these legislative debates."

New Jersey's experiment with red light cameras proved so unpopular that no state legislator dared to introduce legislation to continue the statewide program until it was too late to have a realistic shot at consideration. The authorization for red light camera use expired on December 16. Governor Chris Christie (R), who had previously supported automated ticketing, sealed the fate of the program in September by saying he was unlikely to sign a bill allowing further red light camera. As a result, Redflex will lose $2.1 million in revenue, which is 6.2 percent of its expected annual take from American drivers.

Although Ohio did not ban speed cameras, Redflex says the state has "reduced the viability" of red light cameras. A new law that passed in the place of an actual ban on cameras will trade fixed speed cameras in favor for mobile photo radar units. Redflex expects these changes to cost $1.9 million in losses, and a 5.7 percent drop in annual revenue.

That will hit hard, as Redflex reported a net loss of $1.2 million last year. Losing another $4 million will compound problems from the ongoing Redflex bribery scandal in Chicago, Illinois, which has already cost the company $9.7 million in lost profit and $2.4 million in legal costs. The "Student Guardian" school bus camera flop has cost $4.3 million. A New Jersey class action lawsuit settlement and being caught underpaying wages in California has cost $1.5 million.

The company's CEO is so worried by developments in the United States that the firm is considering leaving the red light camera and speed camera industry because of the risk.

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