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'Loser fees' taking place of new taxes (Surcharges added to tickets, DWIs help fund government)
Houston Chronicle ^ | 3/5/06 | DAN FELDSTEIN

Posted on 03/06/2006 7:43:08 PM PST by elkfersupper

Chemical plant technician Steven Lozano really got nailed: speeding, an expired inspection sticker, an expired driver's license and dubious proof of insurance.

The cost of his traffic infractions: $675 and a wait in line recently at Houston Municipal Court. What Lozano didn't know — few people do — is that only about half of the hefty fines had anything to do with his traffic conduct.

The rest were "surcharges." They included money for a prison-guard training institute at Sam Houston State University and money for a juvenile-crime program at Prairie View A&M, among other things.

"A lot of this has nothing to do with me," said Lozano, when shown the list of common surcharges. "Fugitive apprehension? Abused children's counseling?"

No politician wants to raise tax rates. But life's temporary civic losers — those with a traffic citation, a DWI conviction or a bail bond to make — are an increasingly attractive target of cash-starved governments.

Lozano and everyone else in line that day were paying 21 mandatory fees that now grace the average local traffic citation.

Got a broken taillight? The city of Houston fine is $30. But you'll pay $93 extra in surcharges — four to the city and 17 to the state.

Governments often cover the cost of specific services with a "user fee." Call this twist the Loser Fee.

Did you get a parking ticket? By state mandate, the city adds a $5 surcharge that's passed to local school districts for crossing guards. Without it, the money might come from school property taxes.

"This stuff happens all the time, especially in states without income tax. I just call it 'anything-but-taxes,' " said David Brunori, a contributing editor to State Tax Notes and a public policy professor at George Washington University.

In fact, it's very much a tax — a compulsory payment that helps fund government. Texas lawmakers have added at least one new surcharge to traffic tickets every legislative session since 1987, according to a Houston Chronicle search of bills, statutes and budget books. This covers a span when both Democrats and Republicans controlled state government.

The state expects to collect nearly $300 million from piggybacking on local traffic tickets this year.

And that figure could double with a new Driver Responsibility Program designed to charge the state's worst drivers a special fee. In that program, first-time drunken drivers are being assessed a surcharge of $3,000.

State Sen. Royce West, D-Dallas, created a 50-cent traffic-ticket surcharge, the Prairie View A&M fund, by amending a bill in 1997. He makes no apology.

"That type of funding is used. Period," West said. "Obviously, we have only a finite amount of resources. And so if someone has a great idea, they need to be able to help determine how it's going to be funded."

Funding is certainly a problem in Texas government. The Legislature will meet in special session this spring to consider new revenue sources for public schools as citizen groups demand an end to soaring property taxes.

To raise money, governments often rely on user fees for everything from building permits to zoo admissions. And Texas extracts professional license fees from everyone from athletics trainers to water-well drillers.

But no matter how attractive as a tax alternative, all such fees have market and political limits.

Even "sin taxes," such as the 41 cents Texas collects from each pack of cigarettes, have maximums. If they go too high, smugglers move in with tax-free contraband or people buy in a neighboring state.

Thus, the newest alternative — loser fees, Brunori said.

"What has happened in the last 10 years is a proliferation of cities and counties and states using fines and civil penalties, although they won't admit it's for general revenue," he said.

Many fees are tied loosely to the crime or misdemeanor committed, Brunori said. One $3 traffic-ticket surcharge in Houston, for instance, goes to Municipal Court building security, and another $4 fee goes to the court computer system.

But every building owned by the city of Houston has security and computers, supported by the city's general tax fund. When Municipal Court gets money from surcharges, the general fund dollars that would have been spent on court costs are freed for another part of government to expand.

Some surcharges are even stealthier. Texas has one on local traffic tickets called "comprehensive rehabilitation," dedicated to the Texas Rehabilitation Commission.

A closer look shows that, by law, only the first $500,000 collected statewide each year goes to the commission. The rest goes to the state's general fund.

The rehabilitation surcharge is expected to collect $10.7 million this year, so that means $10.2 million goes into the state pool.

The same is true of the "judicial and court personnel training fund." The first $500,000 goes to the Court of Criminal Appeals; the next $9.9 million will go to the general fund.

Create headaches The "State Traffic Fee" has a slightly different hitch. Enacted by the Legislature in 2003 at a whopping $30 surcharge per traffic ticket, it is advertised as going to a state transportation fund to allow the state to issue road-construction bonds instead of raising the gas tax.

But the money doesn't really go to that fund, because the law says two-thirds of the first $250 million each year must go to the state general fund and one-third to local trauma centers. This year, the state comptroller expects to collect only $90 million.

That leaves zero for the transportation fund.

Such hidden state charges on local traffic tickets create headaches for local government officials who don't like raising cash on the backs of traffic violators, fearing residents will perceive police as revenue collectors, not safety enforcers.

In 2005, Houston collected and kept $21 million from fines for moving violations. But $24 million in surcharges was added on top of that by the state. The city kept $6 million. The state coffers got $18 million.

"In Texas, we've got to come up with revenue somehow. All the easy means are gone," said Michael Granof, a University of Texas accounting professor.

He recalled a candidate in his neighborhood who announced, "I'm going to spend more on education and cut taxes."

"Great!" Granof said, spending more and collecting less is what gets us into trouble.

Loser fees usually are based on the twin justification of deterring one activity and compensating society for the negative cost of it, said George Zodrow, a Rice University economics professor. For instance, the state can say its new $30 traffic fee deters speeding at the same time as it compensates trauma centers that serve auto-accident victims — a societal cost of bad driving.

Another example: Officials say the cigarette tax helps deter smoking and covers costs to society caused by smoking. Never mind studies that suggest smokers save society money by dying more than a dozen years early, before they linger with geriatric conditions and collect too much Social Security, Zodrow said.

The tax collects more than $400 million per year.

'Happy to oblige'

Sometimes loser fees can reach too far. In December, Texas Attorney General Greg Abbott ruled against a new $30 surcharge on divorce filings. Half the money was supposed to go to a state child-abuse fund, but Abbott said the state constitution requires court filing fees to be directly related to judicial costs, in order not to deter low-income filers.

A new $37 fee on all civil court filings is OK, however, because it goes to pay raises for judges, which is a judicial cost. (It also indirectly raises the pension of state lawmakers, which are pegged on judicial salaries.)

If you happen to be convicted in district court, don't forget the $20 fee for county records management.

And as of 2003, if you get thrown in jail anywhere in Texas, your bail bond will be granted only if you pay an additional $15 toward assistant state prosecutor longevity pay.

If this makes you tired and hungry, watch out.

In the next Legislative session, the House Ways and Means Committee may revive its proposed "snack tax," which would add an extra 3 percent sales tax to junk food and soda pop — to fight obesity, of course.

"What Texas is doing is not uncommon," Brunori said. "It all stems from the unwillingness to pay for what the citizens want and unwillingness of the citizens to pay for what they want."

"If you take a poll of people, they all want lots of services and no taxes," he said. "And the politicians are all too happy to oblige."


TOPICS: Business/Economy; Constitution/Conservatism; Crime/Corruption; Culture/Society; Extended News; Government; News/Current Events; US: Texas
KEYWORDS: criminalization; dui; dwi; greed; madd; papersplease; politicians; republicrat; taxes
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To: Alberta's Child
Okay, let's clarify.

I would rather have public roads, but they don't exist anymore. They're all government roads.

If faced with the choice of toll roads and government roads with armed revenue enhancement agents lurking everywhere looking for some sort of "Mother, may I" infraction, I would rather have toll roads.

61 posted on 03/07/2006 3:21:34 PM PST by elkfersupper
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To: Young Scholar

Perhaps more people should try doing this to protest.

I watched that film clip on broadcast television. The show also had three of the students that thought up and created the event.

I read your comment on the other thread and some of the replies to it and then some.

Most of the obstacles to using the drive-55 method of protest could be overcome by organization and planning by the protesters doing the driving.

For example, where the left lane is strictly for passing, have 6 or more cars in the left lane all passing the co-protestor driving the car to the right by a measly one-mile-per-hour faster speed.

Most cities have an eye-in-the-sky helicopter that has a camera crew that gives traffic reports during rush hour and for other things like accidents and.... drive-55 protestors. It's their job, how could they not report major congestion/traffic snarl.

Figure out ahead of time how long it would take the helicopter to arrive at the  location of the protest and adjust the start time accordingly. At the properly calculated time call the eye-in-the-sky office and inform them of major congestion at "X" location. Perhaps stating that it appear to be caused by some type of protest.

Could have a person driving one of the protestors driving one of the cars call it in on a cell phone. Get on the CB radio and announce the event as it's happening.

The objective is to get media coverage of the protest and its cause. Perhaps get a witness to the protest on a local morning talk show, TV and/or radio.

Witness: "Yeah I was stuck behind one of the protestors. A sign in the back window said: I'm driving 68mph, if you get a speeding ticket the ticket will cost you $30 -- you'll pay an extra $275 that goes toward assistant state prosecutor longevity pay and saving the Whales. The protestors have a point. Still, I was late for work because of it."

How about this: Ted Kennedy wants to take away my 2nd amendment right to carry a gun that protects you from criminals that don't respect your rights or life. 

Or, the designated spokesperson for the protestors could contact a trusted reporter to convey the protestor's message while protecting the identity of the source.

62 posted on 03/07/2006 3:33:21 PM PST by Zon (Honesty outlives the lie, spin and deception -- It always has -- It always will.)
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To: Xenalyte
My hypothetical situation would be one that expired last September.

You will need to take the form that was mailed to you in to the tax office. Between 9-5 on normal business days. DO NOT drive the vehicle with the expired tag. You must provide proof of financial responsibility (a bond or insurance). You will be required to sign an affidavit that you have not received a citation for the expired registration. You will also be required to sign an affidavit as to whether you have driven the vehicle since the tags expired. Think very carefully when signing these. You may incriminate yourself, and get the opportunity to pay some (more)surcharges!

63 posted on 03/07/2006 3:52:16 PM PST by ARealMothersSonForever
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To: Xenalyte
second link answered the question.

Of course it did, that's what I'm here for.

64 posted on 03/07/2006 5:06:15 PM PST by humblegunner (If you're gonna die, die with your boots on.)
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To: Alberta's Child

Just pulling your leg, don't blow a gasket.


65 posted on 03/07/2006 6:10:22 PM PST by dljordan
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To: dljordan
I see.

Don't mind me . . . I'm a little slow on the draw sometimes. LOL.

66 posted on 03/07/2006 6:12:32 PM PST by Alberta's Child
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To: elkfersupper

I am sick of scum-bag politicians whining that they don't get enough revenue. These crooks have so many new streams of revenue that did not exist 10, 20 or 30 years ago, such as cell phone taxes and cable TV taxes. No matter. It is never enough. We need to bring back tarring and feathering for any politician who even thinks of a new tax.


67 posted on 03/07/2006 6:16:15 PM PST by StockAyatollah
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To: elkfersupper
... are an increasingly attractive target of cash-starved governments.

I despise that term. There is no such thing as a "cash starved government." They are all cash Gluttens --- every damn one of them.

There is no amount of cash they can not spend and then claim to be hungry for more. You can not possibly give them all the cash they desire because their is no limit to their desires. Like any individual with an addiction, they will always want more and more and more.

68 posted on 03/07/2006 6:25:29 PM PST by Ditto
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To: Zon

I've always thought social engineering by tax law beat it by legislation hands down.


69 posted on 03/07/2006 6:33:55 PM PST by decal (Whoever said you can't fool all the people all the time has never visited DU...)
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To: lesser_satan
How about CUTTING SPENDING YOU STUPID F---!

It's not even about "cutting spending." In most jurisdictions, tax revenues automatically increase in line with the economy and population. In other words, they get more money without doing anything. But that increase is not enough for them. They are always looking at ways to "enhance revenue." Reducing spending is not even on the table. It all about the rate of spending growth which in most governments is always several points beyond economic growth.

Government is a revenue glutton. Now matter how much it gets, it is never enough. It can not be satisfied.

70 posted on 03/07/2006 6:38:43 PM PST by Ditto
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To: Galveston Grl
The big lie is that if Texas would just have an income tax, all other taxation (espeically property taxes) would be reduced or disappear. Don't beleive it.

Correct you are. Thirty years ago, they promised that if we only had income tax, others taxes would go away.

It never happened. All the other taxes have increased right along with the increasing income tax.

71 posted on 03/07/2006 6:45:07 PM PST by Ditto
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To: elkfersupper
I would rather have public roads, but they don't exist anymore. They're all government roads.

A public road IS a government road. Otherwise, it is a private road.

72 posted on 03/07/2006 6:50:18 PM PST by BeHoldAPaleHorse (Tagline deleted at request of moderator.)
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To: BeHoldAPaleHorse
A public road IS a government road. Otherwise, it is a private road.

Not exactly. We used to have public roads that belonged to the public. Now they belong to the government.

A private road is neither a public road nor a government road. It's privately-owned.

73 posted on 03/07/2006 6:57:39 PM PST by elkfersupper
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To: elkfersupper
Not exactly. We used to have public roads that belonged to the public. Now they belong to the government.

If they "belong to the public," they belong to the government. If they do not belong to the government, then they are owned by a private entity. Said entity may consist of one or more individuals.

74 posted on 03/07/2006 7:02:31 PM PST by BeHoldAPaleHorse (Tagline deleted at request of moderator.)
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To: BeHoldAPaleHorse
If they "belong to the public," they belong to the government.

Nope, the government separated itself from the public interest quite awhile back.

Used to be, the public owned the roads and the government maintained them.

Now, the government owns the roads.

Otherwise, how does one explain the content of this news article?

You think the public wants all these surcharges for silly nanny-state traffic violations?

The only way the governments get away with it is incrementalism and picking us off one at a time.

75 posted on 03/07/2006 7:13:25 PM PST by elkfersupper
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To: elkfersupper

In other words, in a long-off and mythical past, you got something for nothing.

News flash: TANSTAAFL.


76 posted on 03/07/2006 7:26:54 PM PST by BeHoldAPaleHorse (Tagline deleted at request of moderator.)
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To: BeHoldAPaleHorse
News flash: TANSTAAFL.

That's why I would rather have every road be a toll road, instead of random criminalization of the users.

But politicians don't have the courage to do that. They prefer these sneaky taxes.

Last time I got a seatbelt violation, I deducted the fine on my federal tax return as "state and local taxes", 'cause that's what it is.

A chicken$h*t way to raise revenue.

77 posted on 03/07/2006 7:34:41 PM PST by elkfersupper
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To: elkfersupper
Is this a great country or what?

I mean, what's left of it.


78 posted on 03/07/2006 7:38:46 PM PST by unixfox (AMERICA - 20 Million ILLEGALS Can't Be Wrong!)
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To: decal

I've always thought social engineering by tax law beat it by legislation hands down.

That doesn't answer the question at post 49: Do you think social engineering is a valid and proper thing for government to do? 

79 posted on 03/07/2006 7:47:28 PM PST by Zon (Honesty outlives the lie, spin and deception -- It always has -- It always will.)
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To: Zon
I don't think government has any purpose other than defense of the realm and production of currency (and you wouldn't have to argue with me very long about THAT, if you came up with a better idea).

But I don't see any gov't NOT engaging in SocEng if it's around long enough.
80 posted on 03/07/2006 7:53:17 PM PST by decal (Whoever said you can't fool all the people all the time has never visited DU...)
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