JEFFERSON CITY — Beginning next month, Missouri motorists may experience some sticker shock when they renew their driver’s licenses and license plates.
In a move designed to help privately operated license offices stay afloat in rural areas, Gov. Mike Parson signed legislation that will boost how much those offices may charge in processing fees.
The fee those offices can charge for handling an annual registration will increase from $3.50 to $6 while the fee for a biennial registration will go from $7 to $12.
The processing fee for a three-year driver’s license will rise from $2.50 to $6. For a driver’s license longer than three years, the fee climbs from $5 to $12.
The fees those offices may charge for title transfers, instructional permits and other specialty licenses will go from $2.50 to $6 under the new law, which was sponsored by Rep. Jeff Knight, R-Lebanon.
Unlike other states where a government agency operates all license offices, Missouri allows companies, individuals and not-for-profit organizations to bid for the right to operate the facilities in exchange for a portion of the fees they collect.
The increases are the first in 20 years and operators say they will offset rising costs, such as an increase in the minimum wage and office supplies.
“For the first time in three years, I can breathe,” said Wayne Grusling, who won a four-year contract to operate the Ste. Genevieve license office in 2016.
Grusling was the only bidder when he took on the job and said he would not have sought another contract next year without the increased fees, potentially forcing residents in the community to drive to Farmington, Perryville or Festus to get their licenses.
“There is a future now,” Grusling said.
Missouri has 177 license offices that process millions of transactions each year. With most of the costs fixed or rising, operators often only can manipulate their labor costs to make profits.
For people wanting their licenses, that can often mean long waiting times because the contractors don’t want to pay to hire additional workers.
In rural areas, where foot traffic is slower, contractors face the double-whammy of keeping employees on the payroll even though there are fewer customers.
The Ste. Genevieve office, for example, had about 26,000 transactions in 2015, the most recent year available. By contrast, the O’Fallon license office had 173,000.
Crystal Webster, executive director of the Springfield-based Breast Cancer Foundation of the Ozarks, said the fees will help the organization’s smaller fee offices in Nixa, Ozark and Republic.
The not-for-profit got into the fee office business about 10 years ago, but it has not been a big moneymaker in the face of rising labor costs and less assistance from the Missouri Department of Revenue, which oversees the program.
“The smaller offices are literally losing money,” Webster said.
She credited the Legislature for moving forward with the hikes after at least three previous attempts to address the fee structure failed.
“I think lawmakers understood the critical nature of the problem,” Webster said. “Fee increases are never popular. But in this case, they were absolutely essential.”
The legislation is House Bill 499.