Our View: Hefty late fees merit 2nd look
January 10, 2010
Steamboat Springs — When state Sen. Al White supported the FASTER legislation last year, he took a political risk and broke ranks with his party. Now, the Hayden Republican and Joint Budget Committee member is reconsidering at least part of the Funding Advancements for Surface Transportation and Economic Recovery measure.
We think that's smart.
During the legislative session that starts Wednesday, White plans to sponsor a bill that would reduce late fees for vehicle registrations. The FASTER bill increased those fees from a maximum of $10 to $25 per month, up to a maximum of $100. White wants to reduce those fees back to the $10 max.
His reasoning: The bill created animosity, and Colorado residents were being charged inequitably, with people paying hefty fees for vehicles that were worth little. There's no variance in the fee based on vehicle value, so the late fee on your Ferrari registration is the same as that for your camping trailer.
Although we support the intent of White's legislation, we're not sure cutting the fee back to the $10 maximum is the ideal solution. The point of a late fee is to encourage people to pay their registration fees on time, which they should be doing anyway. A $10 fee might not be enough to give scofflaws the necessary kick in the rear.
But an increase to $25 per month during a recession is too much. Perhaps White and fellow lawmakers should work on a system that charges people a small percentage of their vehicle's value per month, increasing to a point and then leveling off. A solution that's reasonable and fair across the board is in order.
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There's no doubt the FASTER legislation raises needed money for transportation — $252 million is the projected annual income — at a time when revenue is scarce for the Colorado Department of Transportation. As White noted, however, that projection doesn't include the increased late fees.
"My argument is we never anticipated raising any revenue from there, so how can we miss what we never anticipated receiving in the first place?" White said in a Dec. 31 Steamboat Today article.
The new fees already have brought bucks into Routt County. Clerk and Recorder Kay Weinland and county Accounting Manager Carol Comeau said the county collected $120,385 in late vehicle registration fees from July 1 to Dec. 1. Of that amount, $90,925 went to the state, and the county retained $29,460. The county collected $446,365 in additional FASTER-related fees during that time, Comeau said, and has retained a total of $190,097 in FASTER-related revenues.
Safe roads are important to all of us, and we recognize that roadwork and other infrastructure cost money. We, like White, aren't hoping for a reversal of the FASTER legislation. We just think this is the wrong time to look at opportunities to extract revenue from Colorado families who may be trying to make their budgets work month to month.