Motor Vehicles should periodically assess the cost and benefits of updating its automated systems to reflect current per-plate administrative costs. If Motor Vehicles determines that doing so is cost-effective, it should update its automated systems to reflect the up-to-date administrative costs for all these plates.
Computer programming for the revised administrative service fee for all plate programs was completed on December 31, 2014.
Corrective action is completed.
We confirmed that Motor Vehicles has updated its automated service fees to reflect current per-plate administrative service fees on page 8 of our follow-up audit (Report #2015-506, July 2015).
The computer programming of the revised changes for the ASF for all plate programs is still in progress.
DMV is making the changes to revise the ASF for all plate programs and this should be completed by December 31,2014. Periodic cost and benefit assessments will be ongoing.
The State Auditor recommended DMV periodically assess the cost and benefit of updating its automated system to reflect current per-plate administrative costs. The DMV examined actual transaction volumes and Administrative Service Fee (ASF) revenues collected during the twelve-month period. The ASF revenue for the same period was calculated using updated ASF costs. The findings show that had the costs been updated the total collection would have resulted in a collection of an additional $30,743. DMV estimates that changing the ASF of all special plate programs would require 722 hours of staff or contractor programming and cost approximately $52,085 which would be applied to all plate programs equally.
The impact of these fees for special plate programs would be disparate from one program to another. For example, during the twelve month examination period, there were only 274 transactions involving ASF for the UCLA plate and 20,703 transactions for the KIDS plate, yet both would bear the same financial burden in supporting the change.
DMV will revise the ASF for all plate programs this coming year and will continue to monitor the special plate activities and revenue to determine when or if future adjustments are appropriate and represent a responsible investment of special plate funds.
Motor Vehicles provided no documentation to support its assertions. As such, we have assessed this recommendation as "Pending" until Motor Vehicles provides its cost-benefit analysis and we review and assess it.
The Department continues to review the cost/benefit analysis associated with updating the automated systems to ensure current per-plate administrative costs are appropriately charged.
Agency responses received after June 2013 are posted verbatim.