Wednesday, September 05, 2018

Long DPS lines making costs of TX driver surcharges more apparent, outweigh revenue to trauma centers

For years, the economics of Texas' Driver Responsibility surcharge - and its role in subsidizing trauma hospitals around the state - have been cited as the principle barrier to its abolition.

But those economics may be changing before our eyes as the state prepares to pony up hundreds of millions of dollars to reduce long lines at Texas Department of Public Safety driver-license centers.

College Station Municipal Judge Ed Spillane was quoted extensively in a TV news story explaining the failings of the Driver Responsibility Program, which regular readers are aware attaches civil penalties on top of criminal fines for certain traffic-related offenses, most frequently driving with an invalid license (DWLI) and failure to maintain insurance coverage. The economic consequences for low-income drivers was well-described by Spillane and a local driver caught up in the surcharge-cycle for the last decade. Check it out.

When it comes to solutions, Spillane rightly declared that legislators "are at a loss" about how to get rid of the program because half of the money raised (after paying the collections contractor) goes to trauma hospitals, with the other half going into the general revenue fund.

However, the costs and unintended consequences of the Driver Responsibility Program are beginning to add up, and as a result, Grits believes the economics of surcharge abolition may be shifting as other costs rise.

Which brings us to Texas DPS, which has lately come under fire for long lines at driver-license centers. There are essentially two major causes of long lines for renewing driver licenses: Understaffing the Customer Service Center call lines, and the policy decision to revoke a half-million driver-licenses per year to punish nonpayment of fines and fees, most of it for unpaid DRP surcharges.

Underfunding the call center means drivers who can't get DPS on the phone will go into the driver-license centers when many of them could have renewed online. And revoking a half-million licenses per year for nonpayment adds an ever-increasing volume of drivers to the lines who frequently a) cannot renew online and b) have more complex cases to resolve.

So far, legislators have only discussed the first problem: Funding the call center. But eventually, they must address underlying causes of long lines or the problem will recur. The Washington Post reported earlier this year that, among states, "Texas, by far, suspends the most driver’s licenses for failure to pay fines," estimating 1.7 million people with revoked licenses, 1.4 million of whom had their licenses revoked over unpaid surcharges.

So what does it cost to address needlessly long lines at license centers? DPS announced it will request an additional $420 million over the next biennium to deal with long lines: $178.6 million for increased staffing at current offices, $190.1 million to open new offices in high-demand areas, and $51.3 million to boost staffing at the call center.

By contrast, the DRP generates less than $150 million per biennium for hospital trauma centers, and a like amount for the general revenue fund, so nearly $300 million total. But an unintended consequence of the DRP is contributing to long lines at the license centers, which is costing much more than that!

This is like robbing Peter to pay Paul, then still having to pay Paul!

There are other unintended consequences, including major economic detriments from having 1.7 million people with revoked licenses. New Jersey has one of the only comparable surcharge programs in the country, and about a decade ago they performed an extensive survey to analyze the economic outcomes from revoking licenses for unpaid surcharges. In a 2010 blog post, Grits summarized the results thusly:
According to that survey, of persons with suspended licenses whose annual income was under $30,000: (1) 64% were unable to maintain their prior employment following a license suspension; (2) only 51% of persons who lost their job following a license suspension were able to find new employment; (3) 66% reported that their license suspension negatively affected their job performance; and (4) 90% of persons whose license was suspended within this income bracket indicated that they were unable to pay costs that were related to their suspended driving privileges. In addition, of those who were able to find a new job following a license suspension-related dismissal, 88% reported a reduction in income.
We may expect similar results, one imagines, among low-income Texas drivers caught in the same predicament.

Viewed broadly, the economic implications are staggering. In addition to money spent so that hundreds of thousands of extra drivers with revoked licenses can wait in line at the license centers to renew them, the state is losing tax money from reduced income and spending among people who owe surcharges. Plus, Texas' economy suffers from reduced demand as an ever growing cohort of adults experiences the above-cited dings to their earning potential.

Tack onto this the costs passed on to counties and municipal governments for enforcement, particularly regarding DWLI, which has become a perennial problem. In Ector County, for example, driving with an invalid license constitutes the second-most common misdemeanor case prosecuted by the County Attorney after marijuana possession. Local municipal judges and Justices of the Peace face the brunt of these increased caseloads from the DRP and must deal face to face with the seemingly endless sea of drivers under its yoke.

Indeed, one could continue nearly ad infinitum with a list of negative, unintended consequences stemming from DRP license-revocations. A 2015 public policy report, which helped convince the California Legislature last year to end license revocations for nonpayment, articulated some of the additional, hidden costs from, "Using license suspensions to collect debt rather than to preserve public safety."
[T]here are millions of Californians who are not a driving safety threat, but who cannot have valid driver’s licenses. According to the American Association of Motor Vehicle Administrators, this type of license suspension is dangerous because it diverts police officer time and attention from public safety priorities. The police, DMV, and courts spend millions arresting, processing, administering, and adjudicating charges for driving on a suspended license. Add in the cost of jailing drivers whose primary fault was failing to pay, and we have a costly debtor’s prison. 
The current policies are counterproductive for employers as well: there is a cost to hiring and re-training a new person for a job being done well by someone else. It is an unnecessary expense to both employers and the state to pay unemployment insurance for an employee who would be retained if the person had a license. 
Additional costs to the state include the fact that many more families have to rely on safety net public benefits because these millions of suspended licenses are a barrier to gainful employment. There are also the secondary impacts of unemployment on the economy and on families living in poverty; children often bear the brunt of the harms of poverty, and some of these costs will not be fully realized for decades.
All of those critiques apply, in spades, to driver-license revocations in Texas. And most of the half-million annual license revocations in Texas stem from unpaid Driver Responsibility surcharges. Of the 3 million drivers who owe surcharges, nearly half (1.4 million) have had their licenses revoked for nonpayment.

This colossal failure of a program increasingly has become not just a cost-driver for DPS license centers but even a drag on the economy, and by extension, state and local government revenue.

Your correspondent remains hopeful that the 86th Legislature marks the moment when Texas stops looking at driver surcharges as a cash cow and begins to think of them as a money pit. Evidence for that view is becoming increasingly hard to ignore.

See prior, related Grits posts:


Anonymous said...

Those who drive without a valid license and/or without insurance coverage are not criminals and should not be treated as such. Many people in this State are unable to obtain a license and they should not be discriminated against or subject to prosecution.

Tim said...

There is another factor in play in that a good percentage of DPS DL offices were built in the 1960s and 1970s when: 1) the population was a lot smaller and 2) the procress of obtaining a DL / ID card was much quicker then as the requirements were simpler. At some point, the underfunding by the state to modernize and enlarge DPS DL offices was going to catch up to the legislature and it has. The legislatively created DRP has compounded the issue.

Anonymous said...

And the DPS stats are understated as well. They will not let people into facilities and force them to line up outside (called pre-waiting) in an effort to keep official wait times lower.

I renewed in person last month and I waited 5.5 hours. They were scheduling driving tests for November.

Anonymous said...

Some of the outside wait time has to do with fire code and maximum occupancy violations or the potential for.

Anonymous said...

I was reading the cost/benefit analysis and I began to wonder what we would learn if we did the same thing to the costs of maintaining the Sex Offender (SO) registry. When I first started learning about the registries about 5 years ago there were about 85,000 Texans on the list; today the count is unknown ,according to DPS estimates the total is well North of 95,000. The numbers are growing exponentially, so in eight or nine years the registry may contain some 180,000-200,000 persons.

All to monitor a population who collectively have a recidivism rate of 3%-5%.

The obstacles to a successful reentry to are enormous. Folks are unable to get housing, provide for their families, obtain gainful employment, etc, etc. The number of unemployed and underemployedd people is staggering. Among them are the "Romeo and Juliet" cases where the uner 18 "victim" later marries the teenaged over 18 SO.

The cost to monitor the registries must be growing as well. Texas should do a cost /benefit analysis of supervising, reincarcerating individuals for administrative reasons, and all other related costs, such as the state paying for the required sex offender therapy.

All to monitor a population who collectivly have a recidivism rate of 3%-5%.

George said...

@ Anonymous 03:26

I agree 100% with your observation concerning the SOR here in Texas, as well as abroad. It's a total waste of money and human resources. It does not accomplish what it originally set out to accomplish, namely making our citizens, and society as a whole, safer.

What it does do is promulgate and promote misguided and highly inaccurate information concerning those among us who have convictions of a sexual nature and are mandated by law to register. This atmosphere of fearmongering from, primarily, the media is a unique yoke of burden that registrants are forced to endure on a daily basis. That 3%-5% recidivism rate you quote is actually on the high end of the scale because that was over a 3 year period so divide that by 3 and the actual reoffense, there is a difference between recidivism and reoffense, rate for a NEW sex offense is 1%-1.66%.

Most of the studies that show much higher new reoffense rates were conducted on cohorts from a select field of very high risk individuals and DO NOT reflect the vast majority of people who find themselves on the SOR.

The psychological effect this registry scheme has on the unique class of citizens mandated by law to register is immense. However, this not only affects them but also the immediate members of their families --- wives, husbands, children, parents, siblings and close significant others. Most people simply cannot imagine what all of this madness means until you find yourself, or someone you love, caught up in this chaos. Inadvertently, it promotes vigilantism, brings shame upon the entire family -- especially the children of those on the registry. Can you not understand what pressure they must face a school from their peers directly as a result of the public registry?

There are much better ways to deal with this issue, one step would be to return back to the original version of the registry which was available only to law enforcement. The other thing would be to remove the lifetime reporting requirements and to remove all citizens presently on the registry whose crimes were committed before the registry went into effect. These would be sane and just measures that would improve things exponentially. The best way to deal with it however, would be to abolish it altogether simply because from a statistical standpoint, it simply is not necessary and the costs are much too enormous.

It would be wise, too, to stop reacting to events that happen by rushing to pass new laws haphazardly. This may gain a few points, and votes, to the politicians who author and enact these laws but the unintended consequences are enormous, destroy lives and do nothing in practicality to alleviate the issue it was intended to do.

For those reading this who identify as Christians, know that one sin is no different than another in the eyes of God. What makes a person who commits a sex offense any worse than a murderer or a person who physically and/or psychologically abuses another individual -- adult or child? How can you justify these laws that are aimed at just one segment, one group, of felons? Just because there's sex involved in the equation?

Think about it, all I ask is to think about it. When you start the process of eroding the civil and constitutional rights of one group of people, it could very well prove quite difficult to stop it from expanding to larger and larger groups, quite possibly yourself.