TxDMV On The Road To Self Funding

by Priscilla Loebenberg

The Texas Department of Motor Vehicles (TxDMV), which was intended to be a self-funded agency, may be able to fully meet that goal after a new fee structure is implemented in January.

The TxDMV began operations in November 2009 after the 81st Legislature created it to be a stand-alone agency able to provide a more customer-focused approach to providing motor vehicle services to Texans. Previously, the agency’s duties were under the umbrella of the Texas Department of Transportation.

The 83rd Legislature created the TxDMV Fund so the agency would be self-funded rather than being funded from the State Highway Fund. However, the fund was abolished during the same session in a fund consolidation bill. So, the 84th Legislature recreated the TxDMV Fund in 2015.

The establishment of the fund also allowed the agency to implement a processing and handling fee. TxDMV Public Information Officer Adam Shaivitz said this was intended to “bring about increased transparency for taxpayers by displaying the true cost government bears in providing registration services. The establishment of this fee allows almost all of the vehicle registration fee to be deposited to the State Highway Fund.”

The TxDMV will charge a $4.75 fee for each payment, which is expected to cover the agency’s budget gap for the biennium starting in 2018. Other vehicle registration and renewal fees will also change. A person who registers a typical vehicle at the county tax office will see their payment increase from $51.75 to $55.50. For those who register online, the cost will drop from $54.75 to $54.50. Those who mail in their registration will see an increase from $52.75 to $55.50.

The agency has seen some recent opposition to the new fee structure. Some are concerned that the centralized online system will divert funds from counties to the state. The increase in the fee for in-person renewals or those submitted through the mail has also been criticized as unnecessary.

TxDMV officials point to transparency, efficiency and better customer service as primary benefits of the new system.

“This change consolidates the myriad of add-on fees so Texans will have a clearer picture of where their money goes. To further enhance service and encourage Texans to use the most efficient method for renewing their registration, the P&H Fee rule lowers the cost for online registration renewal,” said Shavitz.

This article originally published in Strategic Partnership Inc.