I agree with you completely. Let's take away the money from fines and donate it to the homeless shelters in the city (if you let the city have it it just becomes part of their budget and the incentives for how fines are generated don't change).
Now, how much of a tax increase can I put you down for? Police departments aren't cheap you know, and recently it's become a fact of life that money from fines has to replace money lost from income and property taxes. Especially with unemployment high and people losing their homes. So - a 5% increase in your city taxes? 3%? How much extra are you willing to pay to recover the budget money lost from losing those fines?
Although I completely agree from an ideological perspective that the whole thing is stupid, I'm also perfectly content to drive the speed limit religiously in areas that I either don't know well OR know to be speed traps/covered with cameras and let the fools who like to take chances make up for my tax money. I'd be willing to go along with a tax increase to cover my own ideological problems with the whole setup - I have no ideological problems with paying money for services, and a functional police department actually provides a valuable service to a community - but I doubt I could get my neighbors to go along with it. For some reason they hate taxes more than they like cops.