FIRST STATE POLITICS

Delaware DMV fee increase seen as road fund fix

Jonathan Starkey
The News Journal
State workers, from left, Rob Wilson, Frank Lowther and John Hanley repair Foulk Road on March 18. Democratic lawmakers on Friday introduced legislation that would raise Division of Motor Vehicles fees to fund road and bridge fixes.

After months of bipartisan discussions, Democratic lawmakers acted alone in introducing legislation on Friday that would raise fees at the Division of Motor Vehicles to fund new road and bridge improvements, and help close a $780 million, six-year deficit in the state's capital transportation program.

The legislation, which would raise motor vehicle document fees and license and title costs, is expected to raise $23.9 million in new annual revenue, which could be matched by new Transportation Trust Fund borrowing.

The package does not currently have bipartisan support. It was backed only by Democratic sponsors when introduced on Friday afternoon. And House Minority Leader Daniel Short, a Seaford Republican, said that should not have been a surprise to leadership Democrats.

"They knew there was no deal," said Short, who wants more compromise from Democrats before agreeing to fee increases.

The Democratic package includes an increase in document fees charged on car purchases from 3.75 percent to 4.25 percent of the purchase price, an increase expected to generate $12.5 million in additional revenue annually.

"We know we need to move forward on legislation," said House Majority Leader Valerie Longhurst, a Democrat, adding that infrastructure debate must start before June, when lawmakers could be consumed with solving a separate, $70 million operational budget gap.

"We want to fix the infrastructure problem before we get to the budget," Longhurst said.

Lawmakers continue to discuss higher consumer and wholesale gas taxes, including a 5-cent increase in Delaware's tax at the pump, to 28 cents per gallon. The goal of legislative discussions was to raise $50 million in new transportation revenue, matched by the same level of borrowing, to generate $100 million in new, annual transportation system funding.

Democratic lawmakers circulated the fee legislation for co-sponsorship late Thursday after letters from business leaders urging support for an infrastructure deal.

Not everyone was satisfied with the deal as it existed Friday morning, and no Republicans are listed as sponsors on the legislation, despite the weeks-long bipartisan discussions.

"Putting money into a broken system with no reform is the definition of insanity," said Delaware Sen. Greg Lavelle, a Sharpley Republican who has been involved in leadership discussions.

Leadership Republicans continue their push to move millions in operational costs out of the Trust Fund to free up money for capital projects. They are also seeking reforms to the state's prevailing wage system.

Democratic legislation also circulated Friday, in an attempt to generate Republican support, would raise thresholds for when prevailing wage rates would apply on public works projects. But Republican leaders believe that legislation does not go far enough to secure Republican votes on higher fees.

"The reform that we want is to benefit taxpayers," Lavelle said.

During a conference call with reporters, Democratic House Speaker Pete Schwartzkopf, a Rehoboth Democrat, said Democrats have attempted to compromise with Republicans.

"The infrastructure issue is not a partisan problem," Schwartzkopf said. "It has everything to do with maintaining our state for the citizens of our state, and for visitors. We should have a bipartisan solution. we need to get this thing started. It's time to get something in writing."

Schwartzkopf said the legislation will be heard in committee next week. Legislation raising fees will need three-fifths support in both chambers of the General Assembly, the Delaware House and Senate. Democrats have enough votes in the House to pass the measures along party lines.

They will need a single Republican vote in the Senate, even if all Democrats approve the increases.

"If they're serious about wanting a seat at the table like they say, and if they're serious about working together to solve these problems in a bipartisan manner, this is a great opportunity to do it," Schwartzkopf said of Republicans.

"Bring your side to the table and let's get this thing done," he said.

Short, the House Minority Leader, said Democrats must give more ground, or they risk taking votes on an infrastructure package without Republican support.

Moving salaries and other operating costs out of the Transportation Trust Fund could help. But relying on higher taxes and fees alone to fund road and bridge improvements is a nonstarter, Short said.

"This is getting pretty ugly, really," Short said. "I would hope that folks are headed to the safe deposit box and putting their money away."

Lawmakers last year rejected a plan by Delaware Gov. Jack Markell to raise Delaware's consumer gas tax by 10 cents, to 33 cents per gallon, to fund $100 million in new road improvements annually.

Beyond higher document fees, the legislation circulated Thursday also would raise fees for the reinstatement of suspended and revoked licenses.

Fees for obtaining a duplicate driver's license would rise from $10 to $20, and fees for duplicate titles also would double, rising from $25 to $50.

Delawareans seeking a title on a vehicle would pay $35 under the plan, up from $25, an increase expected to generate $2.6 million annually.

Those title fees were last increased in 2007.

Also, fees charged at the DMV to obtain a copy of a driving record would rise from $15 to $25, raising an expected $4.5 million. Documents circulated among lawmakers say those costs would mostly be paid by insurers seeking driving records.

Higher fees would take effect Oct. 1, according to a draft copy of the legislation obtained by The News Journal.

Business groups — whose members include contractors that could benefit from higher state roadway spending — sent letters to lawmakers on Thursday urging support for an infrastructure package that would generate $100 million annually, half of that in new borrowing.

"This year we have been encouraged that the legislative leaders of both parties have been willing to sit down and work to jointly shape an infrastructure package that can attract bipartisan support," said a letter signed by leaders of the Delaware State Chamber of Commerce, the Committee of 100, the Delaware Contractors Association and others.

Separately, Republicans hope changes to the prevailing wage system will reduce the cost of public works projects and save the state money.

But they are not going along with Democratic legislation introduced on Friday would raise the contract threshold amount from $100,000 to $500,000 for new construction and from $15,000 to $45,000 for alterations, repairs, renovations.

That legislation also would create a new committee to study additional prevailing wage reforms and report back to the General Assembly by January 2016.

Mike Barlow, chief of staff to Delaware Gov. Jack Markell, said the Democratic legislation "would help make a real difference in the funding for infrastructure projects.

"Delaware cannot fund needed safety projects or invest in job-creating infrastructure projects unless we address the shortfall in the Transportation Trust Fund," Barlow said in an email. "Repairs will only get more expensive and the condition of the roads and bridges we all travel will only worsen the longer we wait. Legislators of both parties understand that and we look forward to talking with them more about the need for these investments​."

Contact Jonathan Starkey at (302) 983-6756, on Twitter @jwstarkey or at jstarkey@delawareonline.com.