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DMV to pass 2.3% credit-card processing fee to customers, commissioner says
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Summary
Vermont DMV Commissioner Andrew Collier told the Senate Transportation Committee the agency will begin passing a 2.3% credit-card processing fee to customers in a rollout starting in May with a June 1 budget 'red line,' while maintaining no-fee alternatives such as ACH, checks and in-person cash where possible.
Andrew Collier, commissioner of the Department of Motor Vehicles, told the Senate Transportation Committee that the DMV will stop absorbing a 2.3% credit-card processing fee and begin passing that cost to customers as part of its FY2027 budget implementation. Collier said the change will be rolled out "towards the May" network update and that June 1 is the committee's "red line" for the budget timing to avoid an estimated shortfall.
"There's no money being made," Collier said, adding that "this is the cost for the transaction fee at 2.3%" and that the agency is not seeking profit but is recovering merchant interchange costs. He cited federal and state authority for passing the surcharge to customers and compared the planned rate to a 3% fee charged by the tax department.
Senator White raised constituent concerns—including an AI-generated review—that argued it might be "unconstitutional to charge processing fees on debit cards." White and other members pressed Collier to confirm the fee applies when the DMV is charged by card processors and not when customers pay by bank account routing or ACH. Collier confirmed ACH and checks will remain fee-free and said the DMV will ensure all locations can accept cash when the change goes live.
Committee members also questioned the timing. Collier said a mid-May rollout was needed because if the surcharge were implemented later it would create a roughly $190,000 unbudgeted payment affecting the FY27 carryover. He apologized for posting notice on the DMV website before briefing the committee and said he would follow up with the legislature and provide materials, including consumer-facing messaging about ongoing scam texts purporting to be from DMV.
The committee did not take a formal vote during the update. Collier cited federal guidance (the Durbin Amendment) and state statute (32 VSA §583) as the legal basis for passing processing surcharges, and said he would share additional documentation with members. The DMV said customers who prefer to avoid the surcharge can use ACH, checks, or (where available) cash.
