Tuesday, July 1, 2003 | 9:08 a.m.
CARSON CITY -- Motorists who give bad checks to the state Department of Motor Vehicles may not have to worry about having their driver's licenses or vehicle registrations suspended.
Among issues left unresolved by the Legislature is a decision to extend a pilot program started by state Controller Kathy Augustine to collect money owed to the state.
"This would be a setback," she said, referring to the end of the trial program Oct. 1.
The bill to extend the program never got out of the Assembly Ways and Means committee. Assemblywoman Chris Giunchigliani, D-Las Vegas, said Augustine never presented backup information to justify the program's continuation.
Giunchigliani said it mysteriously turned up in the Senate's version of the tax bill, adding it was not appropriate to attach the legislation to tax matters.
The Senate's tax bill extended the debt collection effort, but the provision was stricken from the bill in the Assembly, where it fell one vote shy of passing.
Augustine said the program generates revenue at no cost.
Under the program, the DMV runs bogus checks through the bank a second time, which clears about half of them, agency spokesman Tom Jacobs. For those that don't clear, the department sends motorists a letter warning them about the punishment and giving them 30 days to pay.
That effort brings payment from about 25 percent of those remaining debtors, Jacobs said. The names of non-payers are then flagged, and the driver's license involved is suspended, or if the check was for a vehicle registration, the motorist won't be able to re-register the car until the debt it cleared up.
About 200 to 250 bounced checks are turned over to Augustine's office each month for collection, he said.
Started in December 2001 the program resulted in a collection of $55,000 in the first month, Augustine said. The threat of a license or vehicle suspension prompted people to pay their bad debt, she said.
The DMV loses $1 million to $1.3 million a year in bogus checks, but more than that is earned through the program, which charges the motorist $25 for a bounced check, Jacobs said. In addition, offenders are charged late fees and penalties for renewal of the registration or driver's license.
Jacobs estimated the department makes $1.4 million to $1.8 million a year from fines and late charges.
The program also included the state Wildlife Department, where hunters and fishermen have bounced checks for their licenses. Augustine said there was a "hit and miss" effort to collect the money before the pilot program suspended the licenses of those who wrote bad checks.
The pilot program has given the controller a "hammer" to collect bad debts without turning them over to a private collection agency, she said.
Senate Minority Leader Dina Titus, R-Las Vegas, said she's not condoning issuing bogus checks, but a person needs a car to get a job to pay off the debt.
"Taking away a car for a bad debt is pretty drastic," Titus said.
Sen. Mark Amodei, R-Carson City, said the suspension of the license or registration is lifted when the check is made good.
But Titus complained the section in the Senate tax bill was never discussed by the full membership.
Amodei and Sen. Mike McGinness, R-Fallon, sponsored the debt collection legislation, Augustine said.
The controller also said the Legislature did not pass a plan to make uniform a $25 penalty for issuing a state agency a bogus check. Some agencies are now charging only $10.
That change would have resulted in an additional $80,000 in revenue, she said.
The Legislature also rejected her plan to require all agencies to join her collection efforts of debts 60 days or older. At present 14 have signed up and three agreements are pending.
The state Taxation Department, which has the biggest amount of outstanding debt, has signed an agreement with private collection agencies that are used by Augustine.
Augustine said her office had collected more than $2 million in the past two years.
But she said that past due money owed the state has ballooned from $118 million on Dec. 31 to $124 million on March 31 this year. The debt grew, she said, because of non-payments to the Taxation Department and the Department of Employment, Training and Rehabilitation.
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