Report 2012-110 Recommendation 3 Responses

Report 2012-110: Special Interest License Plate Funds: The State Has Foregone Certain Revenues Related to Special Interest License Plates and Some Expenditures Were Unallowable or Unsupported (Release Date: April 2013)

Recommendation #3 To: Motor Vehicles, Department of

Motor Vehicles should assess the extent to which it has charged fees for special plates that are not consistent with those prescribed in statutes and take appropriate action.

Annual Follow-Up Agency Response From October 2019

DMV completed a review of special plates fees to verify consistency with statute and identified the need to modify programming for the $1.00 reflectorized fee. The programming was completed on December 31, 2014. Limited resources and required level of effort do not make it cost efficient to retroactively assess the extent of the former inconsistencies.

California State Auditor's Assessment of Annual Follow-Up Status: Partially Implemented

Although Motor Vehicles will not implement part of recommendation to assess the extent to which it has charged fees for special plates that were not consistent with those prescribed in statutes, it has ensured consistency of fees, going forward, with those prescribed in statutes.

Annual Follow-Up Agency Response From November 2018

DMV completed a review of special plates fees to verify consistency with statute and identified the need to modify programming for the $1.00 reflectorized fee. The programming was completed on December 31, 2014. Limited resources and required level of effort do not make it cost efficient to retroactively assess the extent of the former inconsistencies.

California State Auditor's Assessment of Annual Follow-Up Status: Partially Implemented

Although Motor Vehicles will not implement part of recommendation to assess the extent to which it has charged fees for special plates that were not consistent with those prescribed in statutes, it has ensured consistency of fees, going forward, with those prescribed in statutes.

Annual Follow-Up Agency Response From October 2016

Computer programming for the $1 reflectorized fee was completed on December 31, 2014.

Corrective action is completed.

California State Auditor's Assessment of Annual Follow-Up Status: Not Fully Implemented

Although Motor Vehicles' response and the documentation it provided in support of that response address the action it took to assure that the fees it charged for special plates were consistent with those in statute, its response does not address whether it assessed the extent to which it charged fees that were not consistent with law and the results of that assessment.

Annual Follow-Up Agency Response From September 2015

Computer programming for the $1 reflectorized fee was completed on December 31, 2014.

Corrective action is completed.

California State Auditor's Assessment of Annual Follow-Up Status: Pending

As we stated on page 6 of our follow-up audit (Report #2015-506, July 2015), we reviewed 25 special plate fees charged by Motor Vehicles as of June 2015 and identified two instances in which the charged fees did not match the corresponding fees required by state law. We further stated that Motor Vehicles initially did not believe that fees we identified were the correct fees for these transactions. Subsequently, however, Motor Vehicles reexamined its position and now agrees that the fees we identified are the correct fees and indicated that it will begin charging the correct fees by March 31, 2016.

Annual Follow-Up Agency Response From October 2014

The changes being made for the $1 reflectorized fee will be put into place by December 2014 once all system programming by ISD has been completed.

California State Auditor's Assessment of Annual Follow-Up Status: Not Fully Implemented

1-Year Agency Response

The Senate Bill 788, Chapter 523, clarified the requirement of the additional specified charge for personalization of license plates. The bill was signed on October 3, 2013, and the effective date was January 1, 2014. The changes being made for the $1 reflectorized fee will be put into place by the estimated completion date.

California State Auditor's Assessment of 1-Year Status: Partially Implemented

Motor Vehicles did not fully address our recommendation and did not identify its progress in assessing the extent to which it has charged fees for special plates that are not consistent with those prescribed in statutes and taking appropriate action.

6-Month Agency Response

DMV Six-Month Status Update:

A thorough review was performed regarding the applicable statutes and legislative records and their application to the Special License Plate Program. It was determined that the $1 reflectorized plate fee may only be assessed upon registering a vehicle. The special interest and personalized license plates are not issued upon registering a vehicle, but rather through a separate transaction and is not subject to the $1 fee. DMV has planned future programming to be implemented to remove the $1 reflectorized plate fee by July 2014. In addition, the Veterans and Kids license plates are not to be charged the personalization fee. The Senate Committee on Housing and Transportation has incorporated language into Senate Bill 788 making its intent here clearer:

"(8) Existing law also authorizes the Department of Motor Vehicles to issue specialized license plates for veterans' associations and to fund child health and safety programs. Existing law requires payment of an additional specified charge for personalization of these plates. This bill would provide that these specialized license plates are not subject to the payment of another charge generally applicable to personalization of license plates."

The above language changes the requirements as stated in Vehicle Code Sections 5068 and 5072 for both the Veterans and Child Health and Safety Fund plates.

California State Auditor's Assessment of 6-Month Status: Pending

Although Motor Vehicles did not specifically address changes to the fees for the Olympic Training Center license plate in its response above, we note that the implementation of SB 788 also addresses our concerns with these fees. However, Motor Vehicles did not fully address our recommendation and did not identify its progress in assessing the extent to which it has charged fees for special plates that are not consistent with those prescribed in statutes.

60-Day Agency Response

DMV continues to reconcile fees for specialized license plates with applicable statutes and rates to correct any fees incorrectly stated in DMV issued publications.

California State Auditor's Assessment of 60-Day Status: No Action Taken

All Recommendations in 2012-110

Agency responses received after June 2013 are posted verbatim.