N.J. lawmaker questions fees for motorists
The motor vehicle agency routinely takes in more than it needs to provide its services.
TRENTON - A top state lawmaker is questioning whether the New Jersey Motor Vehicle Commission charges customers too much for services, and says officials should discuss lowering fees and returning money to taxpayers.
Assemblyman Gary Schaer (D., Passaic), vice chairman of the Budget Committee, said during a transportation budget hearing last week the proposed 2013 budget for the commission calls for collecting $1.1 billion from motor vehicle customers.
Only about a third of that, $344 million, would go to pay for services. Nearly half, $540 million, would go to the state general fund. The remaining money is dedicated to specific programs, such as the air ambulance run by the New Jersey State Police.
Schaer asked whether state transportation officials had considered returning to taxpayers revenue not used to run the Motor Vehicle Commission.
"It seems to me that given the governor's commitment to tax reduction, where fees are higher than they need to be, perhaps there needs to be discussion about lowering those fees," Schaer said after the meeting.
Motor Vehicle Commission spokesman Mike Horan said money that doesn't go toward operating the agency already goes back to residents in the form of state services.
"Essentially, these are to benefit New Jersey, and that's the whole point of it," Horan said.
New Jersey's Motor Vehicle Commission isn't the only one that brings in more money than needed to provide its services, a spokesman for the American Association of Motor Vehicle Administrators said. Ian Grossman said some states' motor vehicle departments devote an even smaller percentage of revenue to operating expenses.
"This is very much par for the course," Grossman said.
As tax collections have declined, states have increasingly come to rely on motor-vehicle revenue to pay for infrastructure improvements and other programs outside the agencies, Grossman said.
Data from the New Jersey Treasurer's Office show the Motor Vehicle Commission brought in $1 billion in the 2004 fiscal year, of which about 31 percent went to the general fund. For the 2013 fiscal year, the projected rate would be nearly 50 percent.
"For states that are in very tight budget times, the DMV is a reliable source of revenue because you know that the demand is going to stay relatively constant," Grossman said. "You know folks are going to need a license, to register their car. You know you can use that to pay for any number of items in the state budget."