For Budget rentals of Non-Owned Vehicles, who is responsible for collecting subrogation charges?

According to Budget's 2025 Franchise Disclosure Document, the responsibility for collecting subrogation charges on Non-Owned Vehicles falls to the Owning City. This means that if a Budget franchisee rents a vehicle that is not owned by their location (a Non-Owned Vehicle) and that vehicle is involved in an incident leading to subrogation (recovering costs from a responsible third party), it is the responsibility of the city that owns the vehicle to pursue and collect those subrogation charges. The Renting City, however, is responsible for collecting all other charges associated with the rental.

This division of responsibility has practical implications for Budget franchisees. The Renting City franchisee needs to focus on collecting the standard rental charges, while the Owning City franchisee must handle the more complex process of subrogation if it becomes necessary. This division likely aims to streamline the collection process, allowing each party to focus on what they are best equipped to handle.

For a prospective Budget franchisee, it's important to understand this distinction, especially if they anticipate renting out a significant number of Non-Owned Vehicles. They should clarify with Budget the specific procedures and systems in place for managing these inter-city transactions and ensure they have adequate resources to handle their respective collection responsibilities. Understanding the revenue split and expense allocation for Non-Owned Vehicles, as detailed in Addendum A, is also crucial for financial planning.