A bill from the Denver City Council would exempt rental car companies and two other groups from an ordinance that impounds the cars of unlicensed drivers.

Under the bill that was introduced May 18, rental car companies, along with victims of automobile theft, and automobile lien holders such as credit unions and other vehicle financing companies would not have to post a $2,500 bond to release a car that was impounded when a driver was found to be driving without a valid license.

Councilman Doug Linkhart called a citizen initiative to impound the cars of unlicensed drivers “reckless.” Linkhart said the council was working to fix some of the “negative consequences” of the initiative, which was approved by voters last year. The ordinance came under fire recently when an Iraq war veteran’s car was impounded in Denver because his driver license expired.

The initiative’s founder, Daniel Hayes, said his main goal was to get unlicensed illegal immigrants off the road. He plans on resubmitting his impound initiative for the November 2009 ballot. Rental car companies and victims of theft will be exempt in his revised initiative.