Committee reviews expanding DMV suspension power to include bounced electronic payments
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Summary
Legislative counsel told the Transportation Committee that section 7 of a miscellaneous motor‑vehicle bill would let the DMV suspend licenses or registrations when electronic payments (credit, debit, ACH) are rejected; members pressed for consumer‑notice language and discussed fee recovery and an estimated $1.9 million in past uncollected fees.
The Transportation Committee on April 7 examined a provision that would allow the Department of Motor Vehicles to suspend a driver’s license or vehicle registration when an electronic payment is rejected, extending an existing check‑bounce enforcement tool to credit, debit and other electronic transfers.
For the record, I’m Damien Leonard from the Office of Legislative Council, Leonard said as he guided members through the bill text and explained the change: “the Department of Motor Vehicles, if you pay for your registration or your license with a check and the check bounces … they have the authority to suspend your license or your registration, until you pay.” He said the proposal would apply the same authority to electronic funds transfers and card charges where a payment is later rejected.
The committee pressed for operational and consumer‑protection clarifications. The chair said the committee plans to move to charging card‑processing fees up front so vendors recover transaction charges at the point of sale and noted staff estimates “about $1,900,000” has not been collected under prior practice. Deputy Commissioner Matt (Department of Motor Vehicles) confirmed the DMV currently assesses an insufficient‑funds fee and that banks also impose fees independently.
A representative asked whether the bill’s requirement to “send a written notice” would force reliance on snail mail, especially for people who leave state for extended periods. Leonard said the phrase is broad and would encompass electronic notice—‘‘shall send a written notice’’ can include email or other electronic notice if the recipient has enabled myDMV notifications.
Committee members queried how electronic‑payment timing and pending charges could lead to rejected payments after a transaction appears to be accepted. Leonard described common scenarios in which multiple charges or processing delays mean a card or ACH debit that initially showed as pending later fails to clear, creating the same enforcement issue that the check‑specific language currently addresses.
No action was taken before the committee recessed for a scheduled break; members signaled they expect additional drafting to clarify notice methods and consumer protections before any final vote.
The committee is scheduled to resume review after the break and to hear a high‑level overview from Senator Westman later in the session.
