The Virginia Department of Motor Vehicles is facing an estimated $16.4 million revenue deficit that may lead to DMV fee increases. The Richmond Times-Dispatch reported that the DMV also estimates that its shortfall may reach a total of $66.5 million by 2022.
Earlier this year, Governor Terry McAuliffe gave executive approval for a $1 fee increase on informational products provided by the state’s government operations. The fee increase helped lower the original deficit estimate, which was expected to be $28 million higher.
Several solutions have been proposed by lawmakers in an effort to help decrease the shortfall.
VA DMV Commissioner Richard D. Holcomb proposed raising the agency’s vehicle registration, titling or driver’s license fees in order to help reverse the deficit. Holcomb also suggested collecting additional funds from other state agencies, such as the Department of Transportation and the Department of Health.
“We collect billions of dollars for the commonwealth, but we don’t have sufficient funds to operate,” Holcomb told the House Appropriations Committee on Monday, September 18.
VA lawmakers have declared several reasons for the shortfall, including the three percent pay raise that took effect in July for state employees, higher payments due to the Virginia Information Technologies Agencies and the increasing health care costs for agency employees.
Fees for processing customer credit card payments have also played a role in the deficit the DMV now faces.
Specific fee increases that were considered during the House of Appropriations meeting include doubling the vehicle title fee from $10 to $20, which could generate up to $26.1 million in revenue per year.
Drivers license fees may also see a steady increase of $1.25 per year or $10 over the eight-year activation period of a VA driver’s license. This increase could help the agency earn up to $15 million within three years.
Holcomb also proposed letting the DMV keep $4 of the $40.75 fee that goes to the Virginia DOT, emergency medical services and state police.
Another major reason for the DMV’s financial setback is due to the cyber attack the VA State Police agency experienced in April. The attack forced the law enforcement agency to shut down its email system and clean up hundreds of computers, which ended up costing the DMV a total of $1.1 million in repair and rebuilding costs.
According to VSP spokeswoman Corinne Geller, scammers were targeting drivers by emailing them tickets and posing as state police.
“The Virginia State Police does not use or issue digital/automated traffic tickets or summonses,” Geller said in a press release. “Anyone receiving such an email should delete it and NOT click on any links provided in the email. The email scam is just one of numerous tactics used by scammers to harass individuals under the guise of being the Virginia State Police.”