DMV on road to progress

Think you’re saving time and money renewing your license or vehicle registration over the Internet?

You’re only half right.

The Department of Motor Vehicles on Jan. 24 began assessing a small fee to cover the costs of processing credit card transactions for which the agency had been picking up the cost, said DMV spokeswoman Pam Goheen.

The fees are small, 25 cents for a transaction of $6.25 to $12.49 for example, but it adds up, she said. The agency loses $1.8 million a year.

Persons paying over the Internet, phone or at a self-serve machine pay the charge. It does not apply to payments done in person or through the mail because credit card companies do not charge when other payment options are available, legislative staff said.

Lawmakers said the added fee is self-defeating, and in their budget last month, added money and a requirement that the DMV stop charging it.

“One of the things we wanted to provide was an incentive for people to use the Internet, and that just didn’t make sense to charge people extra,” said Delegate John A. “Jack” Rollison III, R-52nd District, chairman of the House Appropriations subcommittee on transportation. “It takes people out of the long lines that we’ve had recently at the DMV.”

Gov. Mark R. Warner cut DMV funding last fall as part of the effort to close a $2 billion budget shortfall, which forced lawmakers to confront the DMV budget and assess how much money it actually needs. The discussion was politicized from the start, as a state audit found the DMV operating on a total deficit of $8 million, which DMV officials said was a misstatement and that all its bills are paid on time — and Republicans and Democrats argued over who was to blame.

In the end, the General Assembly voted to increase DMV funding by $17.4 million over the remaining 15 months of its two-year budget cycle, $1.6 million of it for the current budget year that ends June 30. The money reopens all 12 shuttered DMV offices statewide, restores Wednesday service and adds 332 full- and part-time employees to service counters and administration positions.

The audit and Assembly’s discussions revealed an agency losing money on many transactions, the credit card fee being one, despite large budget increases to improve customer service since 1998.

Lawmakers learned that driver’s license renewals have a per-unit cost of $29 when costs of processing, related programs and regulatory responsibilities are included, based on 2001 information, Goheen said. Drivers now pay $15 for a five-year license renewal, so the Assembly raised it $5. The increase will net DMV an estimated $9.1 million a year, or approximately half of its additional funding in the new budget.

In Virginia there are 5.5 million licensed drivers.

For homeland security, the House and Senate compromised on dueling proposals and agreed to have DMV create rules for new driver’s license applicants to prove legal status in the country by December. The DMV will report back to lawmakers then and implement the rules by Jan. 1, 2004, but Rollison said that short timeframe is not realistic and will probably slide somewhat.

The DMV is getting an additional $400,000 for internal training and modification of forms and software to carry out the new security protocols, he said.

An audit of the DMV by Virginia Auditor of Public Accounts Walter J. Kucharski released in January detailed how DMV expenditures increased from $119 million in 1998 to $150 million in 2002, a 26 percent increase.

“During this same four-year period, deficits in Motor Vehicles’ operating fund continued to worsen despite the increase in additional appropriations,” Kucharski wrote.

DMV officials in an official response did agree that its cash balances had fallen as it invested heavily in technology to improve customer service, but new responsibilities created a problem when the slowing economy cut revenues. “While laudable [improvements], these spending decisions were made under the same assumption as other statewide decisions in the past administration — that revenue would continue to increase at record-setting levels in the future,” the DMV wrote.

DMV said this “financially untenable position” was communicated to the legislature and executive branch in reports including its 2002-2004 budget submission, Dec. 1, 2000, presentations to the House and Senate money committees, and its annual reports for 1999 and 2000.

Rollison said the agency is moving forward to improve service. He met with DMV officials Thursday and was told additional staff were being directed to Prince William DMV offices. At the Woodbridge office, at one time only six of its 21 windows were open, and that was partly because two employees were on sick leave/disability, he said.

Recent checks by DMV at offices have found very few people in line at the time of closure, when in the past it ran into the hundreds, he said.

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