Grits to DPS: Enact Incentive rules for Driver Responsibility surcharge now

This morning I went over to the Department of Public Safety headquarters for a little public-comment time with the Public Safety Commission (PSC) at their monthly meeting. The subject: Enacting an "incentive program" under Driver Responsibility Surcharge rules to reduce costs for drivers who pay the full cost up front by as much as 50%.

Regular readers will recall that in 2009, State Rep. Sylvester Turner secured an amendment requiring the PSC to at least implement an indigency program. Then two years ago about this time, this blog filed a formal petition for rulemaking with the PSC asking them to create indigency, amnesty and incentive programs for the surcharge - all of which had been authorized under state law in 2007 but never enacted. Agency staff first proposed doing nothing but an Indigency program in bare minimal compliance with the law, but commissioners took a personal interest in the subject, insisted on including Amnesty provisions, then sent staff back to the drawing board with orders to accept more input and come up with a new proposal. DPS formed a stakeholders' working group on which your correspondent served along with representatives from trauma center hospitals and the lovely and talented Amanda Marzullo, then an attorney with the Texas Fair Defense Project who has sadly moved on to greener pastures.

As a result of that process, DPS suggested three new sets of rules which were all submitted to the Public Safety Commission: Amnesty, which was enacted and earlier this year cleared the records of more than 100,000 drivers; Indigence, which took effect in May and reduces fees for drivers under 125% of poverty; and an "Incentive" program cutting fees for drivers who pay off the surcharge up front. The Incentive rules, though, were placed in the Texas Administrative Code along with the others but not given an effective date: In other words, it would require additional action by the Commission to breathe life into the Incentive rules. But now the Legislature has directed them to do so..

The last time I was at the Public Safety Commission was to thank their members for enacting the Amnesty and Indigence rules, and to urge them to enact the Incentive rules they'd created as soon as feasible. Chairman Allan Polunsky replied that, because of potential fiscal implications, the PSC had done all they felt they could do on their own regarding the surcharge and would be "looking for direction from the Legislature" before implementing the Incentive rules or otherwise altering the program.

Then came the 82nd Texas legislative session. Despite the Senate Criminal Justice Committee's interim recommendation that the surcharge be abolished, the 9-figure fiscal hole that would create deterred legislators from acting on bipartisan proposals to do just that. Instead, your correspondent asked state Reps. Ryan Guillen and Armando Walle to amend a bill Guillen was carrying - which would have allowed full, 100% payment one-time of surcharges up front - to require implementation of the Incentive rules sometime during this biennium. (Literally the entire amendment was to delete a "may" in the old law and insert "shall." ) As a result of Walle's amendment to Guillen's bill, not only do people still get to pay early, as Guillen's original bill would have allowed, once the Incentive rules are passed, they'll get a 30-50% break if they pay in the first 30-90 days after the surcharge is assessed. Here are the reductions under the TAC rules:

• 50% of all three years of surcharges assessed for each offense if payment is made within 30 days.
• 60% of all three years of surcharges assessed for each offense if payment is made within 60 days.
• 70% of all three years of surcharges assessed for each offense if payment is made within 90 days.

State Sen. John Whitmire carried the bill in the eastern wing of the capitol, but it passed without opposition or controversy in both chambers. Today I showed up at the PSC to put the issue onto their radar screens - it's a good thing, too, since commissioners didn't seem aware of the change - and to ask them to push the process along as quickly as possible. It's understandable they didn't know about it. A DPS attorney told the PSC that 50 different bills this session required some form of rule change. The agency is still sorting out which to prioritize and which need more vetting before they're ready for consideration.

I argued that implementing Incentive rules should be near the top of their priority list. After all, the rules have been well-vetted by stakeholders in an agency-convened working group, published in the Texas Register, interrogated at a public hearing, and formally (though without an effective date) put into the state Administrative Code. The PSC only need pull the trigger to activate the new rules. That would require another Texas Register notice, but since they were ordered to enact the rules by the Legislature, the process shouldn't be controversial. Col. Steve McCraw, himself not a fan of the surcharge, told the commission  that staff would be bringing them the rule changes soon.

Several related issues Grits raised with commissioners:

First, for whatever it's worth, I asked the PSC to consider holding another Amnesty sometime in the relatively near future, hopefully with a couple of upgrades to the process from this spring. Promotion is a big one: There need to be more concerted efforts to notify people eligible for Amnesty, including planning ahead so the vendor notifies folks specifically about the program rather than just add one inconspicuous sentence to a dunning letter.

Also, we learned a few things about the Amnesty program during this first trial run, and one unexpected tidbit is that many drivers who are eligible for Amnesty actually need pay nothing if they applied to clear their record. The reason is that the charge is 10% up to $250, and many people have already paid more than that. Often they began paying their surcharges, or paid the first year, but just couldn't keep it up for three years - when the surcharge comes to compete with one's water or electric bill, it slides down the priority list. Still, a lot of folks pay significantly into the system before stopping. I suggested that the PSC tweak the Amnesty rules to identify in their databases everyone who would be eligible for Amnesty without paying any additional money, and clear them administratively instead of requiring a pro-active request from the applicant. That overcomes the problem of promotion entirely for a large number of people eligible for the Amnesty program (though not the Incentive and Indigence programs) Why not just take the opportunity, I suggested, to clean up the system of so many of these old cases and let potentially hundreds of thousands of drivers get on with their lives?

The final suggestion I offered related to the vendor contracted to perform collections for the Driver Responsibility program - Municipal Services Bureau out of Austin. Now that the Driver Responsibility program has expanded to include the Amnesty, Indigence, and soon the Incentive programs, the contract with MSB should be updated to have them perform communications tasks related to those programs as well as straight-up collections functions. Robocalls, at a minimum, should be employed to reach eligible drivers where numbers are available (MSB does them for their regular collections regimen), and potentially direct mail as well (just like they mail out dunning notices). The contract with this vendor and the communications services provided under it haven't kept up with the new demands from the Legislature and DPS rules. And since the vendor is paid off the top from the surcharge revenue, there's really no reason not to contract for those additional services - at least it won't come out of the agency's budget. Commissioner Carin Barth mentioned that the vendor's contract isn't up until 2013, but based on their past presentations to the PSC, I bet they could be convinced to adjust it.

Making predictions in politics is a fools game, but it wouldn't surprise me to see DPS publish rules to enact the Incentive program by this fall or next spring at the latest. The Legislature has given them plenty of cover - in fact, they've issued a command - and all the prep work has been done. Naturally, I'd rather see the surcharge abolished entirely. Incentive rules, like the Amnesty and Indigence rules before them, are not a cure-all, but they help a lot of folks until the day abolition becomes politically feasible. Plus, debates about the rules serve to educate policymakers and stakeholders about problems with Driver Responsibility surcharge, keeping the issue alive and current so that someday - possibly not until the fiscal crisis is behind us - there could be sufficient momentum to rid the state of this ignominious tax-by-another-name altogether.

Until then, promptly enacting the Incentive rules would be a great and (now legally) necessary next step.

See related Grits posts:

• Amendment tells DPS: Implement incentive rules for Driver Responsibility surcharge
• Hospitals: Driver Responsibility surcharge an unreliable funding source
• Bill to abolish Driver Responsibility surcharge gets hearing Tuesday
• What's the one thing John Whitmire and Leo Berman have in common?
• Declining DWI convictions and the unmitigated failure of the Driver Responsibility surcharge
• Federal suit filed to declare Driver Responsibility surcharge unconstitutional
• DPS Director: No public safety benefit from Driver Responsibility Surcharge
• Prosecutors altering charging decisions to avoid Driver Responsibility surcharge
• Driver surcharge boosting Texas joblessness
• Unexplored costs from DPS surcharge harm safety, the economy
• Driver Responsibility surcharge 'devastating' for court system
• Bill author says 'overly punitive' Driver Responsibility surcharge a 'mistake'