Las Vegas Sun

March 29, 2024

Eating cost of credit cards questioned

CARSON CITY -- The state will pay $5 million next year on behalf of customers of the Department of Motor Vehicles who use credit cards for driver's licenses and registration.

Senate Majority Leader Bill Raggio, R-Reno, wonders why the state "is eating" the cost rather than the customer.

Dennis Colling, chief of administrative services for the department, said permitting customers to use credit cards is an accommodation. He said it keeps the public from coming into the offices.

Colling said the contract does not allow the state to charge the consumer for the use of a credit card.

He told the Senate Finance Committee today that credit card use is encouraged and saves $6 million a year in operations, $10 million in the cost of a new building and $5 million to $6 million for property for a new headquarters.

Colling was before the committee to ask for $1.4 million more to cover the cost for the rest of this fiscal year. He said there has been a 35 percent growth in the use of credit cards this year.

Under the proposed budget, the state agency will pay $5 million next fiscal year and $6 million the following year to the credit card companies

Under questioning, Colling said Master Charge and Visa charge 1.82 percent per transaction; Discovery, 1.60 percent and American Express 2.35 percent. The average cost per transaction has been $4 that is paid by the state.

Sen. Bob Coffin, D-Las Vegas, suggested the department "get rid of American Express." He said anybody who has an American Express Card also has a Visa or a Discovery card.

"You could save hundreds of thousands of dollars by eliminating American Express," Coffin said.

Coffin also suggested the state might receive a better rate because there is a low risk of fraud in handling the credit card, as opposed to a merchant.

"You've got a real hammer," Coffin told Colling, referring to cancellation of the driver's license or vehicle registration.

The committee did not take action on Senate Bill 93 that asks for the supplemental appropriation.

The committee also heard a request for $690,000 for the Nevada Highway Patrol to carry it through the rest of this fiscal year.

Col. David Hosmer, chief of the patrol, said $375,000 of the request was due to the rising price of gasoline. The patrol was budgeted to pay $1.20 a gallon.

He told the committee that the patrol buys its gas from several sources but the major supplier is the state Department of Transportation that charges $1.89 a gallon.

He said he needed $137,000 for maintenance of the older cars in the patrol fleet. He said the Chevrolet Impalas are having a higher rate of transmission failure than expected.

Sen. Bernice Mathews, D-Reno, questioned Hosmer about the unmarked patrol cars. She called it "a sin" for a patrol officer in an unmarked car to flash their red lights on speeding vehicles.

She said the dark windows in the patrol cars prevent drivers from seeing who is inside.

Hosmer said the unmarked cars are used by command and administrative staff. He said they usually do not do enforcement work but "try to slow people down" by using the flashing red light.

Mathews said she keeps going even if there is a warning light.

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