The Associated Press
Friday, May 21, 2021
LAS VEGAS — Nevada's motor vehicle department plans refunds to motorists and will instead ask lawmakers to tap state highway construction funds to pay for a troubled computer modernization program.
The decision came after the state Supreme Court struck down as unconstitutional a $1-per-transaction fee the Legislature had authorized in 2020, an official said.
A refund method and timeline has not been made public. Motorists were asked to ensure the DMV has their correct address
"The project, now known as DMV Transformation, will proceed as planned," state Department of Motor Vehicles spokesman Kevin Malone told the Las Vegas Review-Journal following the high court ruling last Thursday. "The department will be seeking Highway Fund appropriations to cover the loss of this revenue."
The Legislature appropriated $59.6 million over the next two fiscal years to complete the project, and Malone said lawmakers approved a contingency plan for the potential loss of about $14 million the DMV Technology Fee had been projected to bring in.
The state Supreme Court sided with Republicans and ruled the Legislature in 2019 unconstitutionally used a simple Democratic-led majority vote to approve extending a business tax and the fee, which had been set to expire in 2020.
Nevada voters amended the state constitution in 1994 to require two-thirds of lawmakers in both chambers to approve any measure that "creates, generates, or increases any public revenue in any form," justices noted.
The DMV transaction surcharge was to modernize the agency's 20-year-old computer system under a contract that became the focus of corruption allegations and a finding by state auditors in 2017 that the project had been mismanaged. The contractor, Tech Mahindra, was fired the following year.
The state used "unproven" technology and had "nonexistent" project management controls at the DMV, according to a report from a contractor the state hired to determine what went wrong.
The Review-Journal in 2019 reported that the retired head of the DMV, Troy Dillard, went to work for Tech Mahindra at the same time the company was awarded the $75 million contract.
The newspaper won the unsealing of a lawsuit filed by a company executive, Brian Coffey, accusing DMV employees of sabotaging the modernization when bribes were not paid.
As much as $25 million was spent on equipment and technology that wasn't usable, the Review-Journal reported.
No one was charged in the case, and the DMV employees who worked on the contract remain on the state payroll, Malone said.
A Tech Mahindra spokesman and Tech Mahindra court filings in the Coffey case denied corruption allegations.
The Review-Journal reported the company was not required to repay the money and a settlement avoided litigation.
