In California, specialty license plates have generated $250 million over 20 years. However, an audit was finally performed in 2012 that unearthed what many would find disappointing: the state failed to collect millions each year and money dispersed rarely was used as stated. Luckily, California seems to be the only state blatantly misusing and misplacing money generated from the specialty license program.
I recently received my DMV vehicle registration renewal in the mail and it comes with the little sheet of paper titled “Order Specialty License Plates!” Well due to my new passion of finding ways to help where I can, I started looking into these plates. Figured, “Eh it’s only an initial $50 and then $40 every year. That’s about $3.33 per month. No big deal.” Right? Wrong! It is a big deal when that $40 isn’t being put where intended!
Each plate is designated with the cause and how the money will be spent. For California, right now there are 8 different plates being offered:
- Protect Our Coast & Ocean – Fund community projects throughout CA to clean-up beaches, teach ocean science & stewardship, build coastal trails, and restore natural habitat
- Show Your Love for Lake Tahoe – Fund hiking and biking trails, wildlife programs, and critical water quality projects. Sponsored by the nonprofit Tahoe Fund
- Protect Kids! – Fund child abuse prevention and child safety programs in communities throughout CA
- Drive the Arts – Fund CA Arts Council programs, giving kids the tools to imagine, create and innovate
- Love Yosemite? – Support trail repair, habitat restoration, wildlife protection, and more in the park
- Save Lives: Buy the Pet Lovers Plate – Funds free and low cost spay and neuter to stop the killing of innocent cats and dogs
- Be a Patriot! – Support Anti-terrorism Fund
- Honor Our Veterans – Fund County Veterans Service Offices statewide
Each snippet even tries to pull your heartstrings more with lines of “Show the world you care..” and “Essentials for success in all walks of life.” The Yosemite one even offers a free gift when you tell the Yosemite Conservancy about your plate! Yeah! Because who doesn’t want a free gift…..
All the organizations offered for California sounded great! I’ve always been partial to the ocean and have always loved the whale’s tail plate. BUT before I signed my money away to receive my cool new plate, I decided to do some research. That extra $50 and then $40/year does add up over time. I mean that’s a new pair of fair trade shoes! Thus, off to Google, and the results were as I feared….
In mid-2012, Governor Jerry Brown ordered an audit of the California specialty license plate program after a review by The Associated Press. The AP chose to review the program after Elizabeth Ashford, spokeswoman for the governor, stated that the governor had no immediate plans to return $3 million taken by Brown and former Governor Schwarzenegger that came from a fund involving a memorial plate created in honor of the victims from 9/11 as the money helped close the budget deficit. They’d only consider repaying the loan if it negatively affected the memorial license plate program. This showed there was little oversight of the $250 million raised in the 20 years since the National Conference of State Legislature authorized it (Los Angeles Daily News, 5-29-2012).
According to AllGov.com, the audits performed by the Department of Finance and the California State Auditor found MILLIONS of dollars improperly handled by the Department of Motor Vehicles (DMV) and the agencies it dispersed the funds to. Read the report here performed by the auditor.
Based on the report, the state failed to collect $22 million generated by the plates over two years, ending in mid-2012. The process is the DMV is in charge of collecting the fees and distributing them to the appropriate agencies. They appropriated some money, but also:
- Undercharged plate owners by $10.2 million
- Failed to collect another $12 million from renewal fees related to the plates program (in that they didn’t allocate that money to the plates program)
- Overstated the costs for administering the environmental fund by $6.3 million.
As for the appropriated money, according to the same article, the environmental fund is the largest benefactor from the specialty plates. The DMV appropriated $40 million from the environmental fund to 24 entities in 2011-2012. An audit by the Finance Department looked at the six largest environmental fund recipients, representing 78% of the money allocated ($31.3 million) and found out that most cannot identify where the money went!
Five of the six departments spent money on general operations instead of the projects and programs that the law demands. The exception was the Department of Fish and Wildlife. The Department of Parks and Recreation listed $1.7 million spent on personnel and $1.4 million on operations and equipment, but did not list any specific projects and programs. The Tahoe Regional Planning Agency and the California Tahoe Conservancy mixed the donated money with general fund revenues and on unrelated programs.
Other notable agencies:
- Department of Agriculture spent nearly $900,000 from one plate fund for expenses like employee compensation and building leases.
- California Emergency Management Agency unable to show that employees paid from special plate funds were actually working on the intended goal of preventing terrorism.
- The Natural Resources Agency failed to submit required reports.
- The California Victim Compensation and Government Claims Board failed to identify and notify people eligible for a scholarship program funded by the plates. (The DMV advertised the plates as benefiting those children seven years after the department stopped funding the program.)
And the kicker…after the audit, the report “recommended” each funding recipient follow the law and identify the projects and programs it spends environmental fund money on.
What did the DMV have to say about the conclusion from the report? According to an article by The Sacramento Bee, Chief Deputy Director Jean Shiomoto wrote, “The costs associated with such an effort could be substantial and likely would result in severely reducing any net proceeds to the special plate funds or even eliminating the programs’ viability altogether. As a result, further study is warranted to identify alternatives and determine the true cost to implement necessary changes before a final decision can be made as to what is the most appropriate course of action for the State, taxpayers and special fund stakeholders.” Basically, the DMV says it’ll cost more money to do a better job at organizing the money.
According to a press-release by The Sacramento Bee, Assemblyman Jared Huffman, who is promoting a specialty plate to help fund state parks, believes that every part of the parks budget needs help and would not be troubled if some of the funding goes to maintenance or the immediate crisis of closing parks. Several beneficiaries believe there is no need to track the money collected because it’s spent as intended. This belief is held by Mary Beth Barber of the California Arts Council because she sees it as wasting staff time to create a license plate spending report.
(I must attest that I could not find any articles since 2013. No research has been performed to follow up with the 2012 audit hence far, but I am continually looking.)
After discovering the unsettling news in my home state, I started to look into other state specialty license plate programs. I found, so far, that California is the only state that was breaking (or bending in their minds) the law. Maryland and Texas offer the highest amount of options for specialty plates that benefit various causes. Texas plates cost $30 with $22 of that going directly to the charity (the rest is for other administrative costs). Oregon offers among the least options due to their efforts to keep track of all the money obtained and used by the charity programs. In many states, the specialty plates are the program’s only source of funding like the Idaho Department of Fish and Game for their wildlife diversity management and conservation education. (National Conference of State Legislature)
The key seems to be in how each state obtains the money from the specialty plates and reports where the funds will be used. It also relies heavily on the DMV to obtain and allocate the money correctly. California was busted due to the DMV making the first mistake of not obtaining and allocating funds correctly. Then, the larger organizations were held accountable for not placing funds where, under law, they had stated they would.
So, at least in California, we can’t trust that our donations are spent where they tell us. We may actually be handing money directly to the DMV, which is worse to me! I don’t want to donate to the DMV! If the money is given to an organization and they use it for functioning costs, then I won’t get too riled up about it. But not money to the DMV…..
I have an idea though. Instead of buying a specialty plate, take that $40 each year and donate directly to the charity, or volunteer your time. Here are my ideas that you can do to support each of the 8 charity programs offered by California:
- Protect Our Coast & Ocean – Join a beach clean-up, visit your local aquarium (Scripps, Monterey Bay, Long Beach, etc.), donate to the many ocean conservancy and marine conservation groups.
- Show Your Love for Lake Tahoe – Donate directly to the Tahoe fund, visit Tahoe, volunteer on hiking clean-up trips.
- Protect Kids! – Donate child abuse prevention and child safety programs in your local community, volunteer your time, or donate household items needed.
- Drive the Arts – Donate to local art programs in your community, take your kids to some art events, go to school district meetings and become an advocate for the arts program
- Love Yosemite? – Donate to the many groups supporting Yosemite, visit Yosemite, clean-up after yourself and others
- Save Lives: Buy the Pet Lovers Plate – Donate and volunteer at your local animal shelter, consider adopting a dog over buying from a breeder, always get your pet spayed or neutered.
- Be a Patriot! – Just be a good person.
- Honor Our Veterans – Donate and volunteer to your local veterans group. Veterans of America is a great donation center, along with the Salvation Army.
However, if you just really like the specialty license plates regardless of who it supports, then do as you please.
From my research, most states use the specialty plates program as intended; as a fund to go towards a specific organization to support their specific program. With the exception of California, state residents are (fairly) aware of where their money is going when they choose to buy a specialty plate in support of a charity, program, or state fund. Nowadays, we should be more concerned with where our money is being spent and not just tossing it down a rabbit hole in the hopes that our good intentions will be met. This is nine times out of ten never the case. It’s sadly the world we live in. Don’t be angry at how an organization spends their money, just do your best to be aware and act accordingly.
If you are OK with organizations in California using the money towards general costs rather than the intended programs, than your money was not wasted. However, if you plan for your money to go directly to some part of an organization, then you might need to reconsider blindly donating your money. There are many ways to help and lots of organizations use donations and profits effectively. Just be aware 🙂
CBS SF Bay Area – “Funds from California Specialty License Plate Program Misused
National Conference of State Legislature – License Plate Information
National Conference of State Legislature – Specialty License Plates: Big Revenue or Big Controversy?