An attempt by the Dayton Daily News to get copies of records that would show how the local deputy registrar offices spend the public fees they collect was rejected by local operators of the largest license bureaus, as well as by the Ohio Bureau of Motor Vehicles.
State BMV officials say Ohio’s public records laws do not require local BMV-contractors to reveal how they spend the money to operate their offices.
The state BMV itself does not know, a BMV spokesperson said.
Ohio’s public records law requires government agencies to disclose such records, and extends that requirement to private government contractors in some circumstances.
But with Ohio considering privatizing other functions — including prisons, charter schools and operations of the Ohio Turnpike — the position of the BMV illustrates a threat to the public’s ability to know how effectively its resources are being used, according to Dennis Hetzel, executive director of the Ohio Newspaper Association.
“As they privatize these items there is less ability to scrutinize how taxpayer money or the public’s money is spent,” said Hetzel. “How can you tell if you’re getting a good deal? How can you tell where their money is going?”
State Sen. Peggy Lehner, R-Kettering, said of the BMV deputy registrar licensing agencies not releasing their finances: “I have to admit that bothers me because certainly the collection of fees they do is a public function.”
“It almost appears you need a special category out there for a public entity that is being privately run, you need a whole new set of rules,” she said.
‘It’s like a consignment shop’
Sheryl Green, who runs the busiest license office in Montgomery County with 111,162 transactions in 2010, said her office doesn’t keep an expense budget.
She said she has eight employees earning between $8 and $12 an hour and a payroll clerk, and she is paid whatever is left over after operating expenses at the end of the year.
The office took in $439,284 in revenue from fees last year, according to revenue reports from the Ohio Department of Public Safety, the only information publicly available.
Ohio’s 200 deputy registrars contract to run their offices for three years at a time based on a competitive bid. Some of the bids are won by county auditors, clerks of court or nonprofit agencies, though the vast majority are run by private citizens.
Deputy registrars receive service fees of $3.50 for each vehicle, driver license and ID card transaction; and 90 cents for each vision screening performed.
The deputy registrars also get all the profit from other services the office provides at its own cost, such as title running services, passport photo services, or selling license plate frames, keychains and other items.
The state pays for the computers and equipment, and the deputy registrar provides the office and staffing.
“The BMV supplies all consumable inventory at our cost,” said Lindsey Bohrer, spokeswoman for the Ohio Department of Public Safety, which oversees deputy registrars. “We absorb the costs for moves, installations, and pay for the computer and communications equipment and service.”
The state also provides about $100,000 per office in back-end administrative support.
“It’s like a consignment shop,” Green said. “They basically furnish the computer system and the plates, and they pay me a fee to (run the office).”
Deputy registrars only run the BMV license agencies. Driver exam stations are handled by the Highway Patrol, and title offices are run by each county’s clerk of courts.
Some estimates
Bonita Davis’ registrar office on the east side of Hamilton is the busiest in Butler County with $340,877 in revenue last year. She said she also doesn’t keep an expense budget.
But she said she doesn’t make much in salary, maybe $35,000 a year, plus benefits.
She said the costs of running her office include seven employees making about $13 an hour, plus benefits, as well as $2,800 a month in rent, $450 a month in utilities and $300 a month in telephone bills.
“My compensation is what’s left, if there is anything,” she said.
State guidelines require an office the size of Davis’ to have the equivalent of at least 5.7 full-time employees, and pay them at least minimum wage.
Davis was more forthcoming than other area deputy registrars. Michael Foley, whose Huber Heights license agency had the highest revenue in Montgomery County with $443,567 last year, referred all questions to state BMV officials. Those officials said they do not have records of how much he or his employees are compensated.
Kimberly McDavitt, whose Beavercreek BMV is the busiest in Greene County with 71,114 transactions last year and $284,562 in revenue, also refused to disclose how her office spends its money. “I’m not giving any information out,” she said.
State: Private firms don’t have to disclose
The amount each office gets in license fees is reported to the Ohio Department of Public Safety. How much the offices as a whole make — and how much deputy registrars pay themselves — is not released.
“I’m a small-business owner, basically just like any other small business owner in the state,” Green said. “How I spend it whether I make money or lose money is basically on my head, not theirs.”
A guide to the Ohio public records laws, produced by the Ohio Attorney General’s Office, says “if there is clear and convincing evidence that a private entity is the functional equivalent of a public office, that entity will be subject to the Ohio Public Records Act.”
State officials side with the contractors.
Ohio Department of Public Safety officials told the Dayton Daily News that they don’t see that information as public record.
“(Their budgets) are not public, because they don’t document the function of a public entity,” said Robin Matthews, public records attorney for the Ohio Department of Public Safety. “How they run their own business has nothing to do with our function.”
State lawmakers weigh in
This mirrors the stance of other for-profit public contractors, such as White Hat Management, the for-profit charter school management firm. White Hat Management operates three schools in the Dayton region. It was sued by the boards of nine northeast Ohio schools who say the company won’t reveal how much state money it receives go into classroom expenses and how much are taken up by corporate expenses.
A Franklin County judge this month ruled that the company must turn over its financial records.
Gov. John Kasich’s administration is forming an advisory team to look at privatizing operations of the Ohio Turnpike, and also plans to sell five state prisons to private firms to manage.
Lehner said she supports privatizing government functions if it will save money, “but we need to be more careful that we are assured that, one: they are being better run ... two: that we are saving money; and three: that they are being operated in such a manner that the public can be assured that those two first parameters can be continually monitored.”
State Senate Finance Committee Chairman Chris Widener, R-Springfield, said, “I would expect if a public function has been contracted out to a private entity, that one of the requirements in that contract should be full disclosure of income and expenses.”
As to the BMVs specifically, “If it’s public dollars involved, we ought to disclose where it’s being spent,” said Widener.
Publicly run BMV loses money
Some license offices are run by public agencies, making their finances open to public inspection. A review of the license office run by Montgomery County Auditor Karl Keith found its operational costs exceed its revenue.
“Right now we’re in a position where we are providing some general fund infusion,” said Bill Loy, assistant county auditor. “We often wonder how they (private deputy registrars) make it, quite frankly, given the state requirement for employees.”
The deputy registrar office Keith runs in the lobby of the Montgomery County administration building on West Third Street in Dayton is supplemented $81,666 each year from the general fund, according to county officials. That pays for the office managers’ roughly $54,000 salary, plus her benefits.
The office did only 35,470 in transactions in 2010, netting it $144,480 in revenue. This made it the least active deputy registrar office in the region.
It employs five people, though state guidelines only require it to employ 2.7. Those employees make about $25,000 a year, Loy said.
Unlike the private contractors, the county office also doesn’t sell license plate frames, bolts or other items. Even if they did that, Loy doubts they could turn a profit.
Loy said in the past running a privately contracted functions — such as a state liquor store — was akin to printing money. “Now with the license bureaus, the general thinking is there’s not much money, if any, to be made with these.”
‘We’re the ones forking it up’
Without transparency, though, it is difficult for the public to determine anything about the efficiencies of the BMV license offices.
“If this service is privatized, how can you assess whether $3.50 is a good amount for each transaction if you can’t assess where the money is going?” asked Hetzel.
Residents coming and going from the Huber Heights BMV on a recent weekday afternoon said they were surprised to learn the office was privately run. And they believed the office’s financial records should be public.
“I don’t see why the public should not be able to have access to or have someone inform them of how the money is spent, seeing as we’re the ones forking it up,” said Mark Lewis, 55.
“(A driver’s license) is something we have to have according to the state of Ohio,” said Steve Jutte, 28, who wondered if the private operators were sacrificing efficiency for profit.
“Last time I came here on my lunch break and I was half an hour late getting back to work,” he said.
One man, Bob Shaffer, 49, disagrees. He said “if it’s a privately held company, how they spend their money is their choice.”
Contact this reporter at (937) 328-0374.
About the Author
