Denver Motor Vehicle Division Performance Audit

Transcription

1 Denver Motor Vehicle Division Performance Audit September 2014 Audit Services Division City and County of Denver Dennis J. Gallagher Auditor

2 The Auditor of the City and County of Denver is independently elected by the citizens of Denver. He is responsible for examining and evaluating the operations of City agencies for the purpose of ensuring the proper and efficient use of City resources and providing other audit services and information to City Council, the Mayor and the public to improve all aspects of Denver s government. He also chairs the City s Audit Committee. The Audit Committee is chaired by the Auditor and consists of seven members. The Audit Committee assists the Auditor in his oversight responsibilities of the integrity of the City s finances and operations, including the integrity of the City s financial statements. The Audit Committee is structured in a manner that ensures the independent oversight of City operations, thereby enhancing citizen confidence and avoiding any appearance of a conflict of interest. Audit Committee Dennis Gallagher, Chair Maurice Goodgaine Leslie Mitchell Rudolfo Payan Robert Bishop Jeffrey Hart Timothy O Brien, Vice-Chair Audit Staff Audrey Donovan, Deputy Director, CIA, CGAP, CRMA Marcus Garrett, Audit Supervisor, CIA, CGAP, CRMA Rudy Lopez, Lead Auditor, MS Rob Farol, Senior Auditor Dawn Shorey, Senior Auditor, MBA You can obtain copies of this report by contacting us at: 201 West Colfax Avenue, Department 705 Denver CO, (720) Fax (720) Or download and view an electronic copy by visiting our website at:

3 City and County of Denver 201 West Colfax Avenue, Department 705 Denver, Colorado FAX Dennis J. Gallagher Auditor September 18, 2014 Ms. Cary Kennedy, Chief Financial Officer Department of Finance City and County of Denver Dear Ms. Kennedy: Attached is the Auditor s Office Audit Services Division s report of their audit of the Denver Motor Vehicle Division (DMV). The purpose of the audit was to review DMV s efforts to address increasing customer wait times and improve customer satisfaction. We found that, since 2012, DMV, in collaboration with the Mayor s Peak Performance initiative, has taken several positive steps to address increasing customer wait times. Average customer wait times have been cut in half from a high of almost one hour in 2011 to approximately thirty minutes in Although these reductions are commendable, the continuous improvement process is just that: continuous. As a community-facing organization that has such a profound impact on citizen perceptions of our City government, DMV cannot rely on prior accomplishments. My Office recommends that DMV revisit and update its strategic objectives and formal Strategic Plan with a focus on additional reductions in customer wait times and improving customer satisfaction. Further, we believe that the Division must also continue to explore progressive initiatives that will improve its service delivery to citizens. With this in mind, my Office has identified at least one such proposal one which will require revisiting the efficiency of enforcing registration compliance in the City and the need for continued use of manual registration tabs in the State of Colorado. Although we recognize that this initiative will require multi-agency collaboration not limited to the City and County of Denver, it has the potential to reduce costs and dramatically reduce in-branch customer wait time for citizens across the State. We strongly encourage City leaders to review opportunities to improve efficiencies in the enforcement of registration tab compliance on behalf of the public with key stakeholders in Denver as well as with our elected State representatives. If you have any questions, please call Kip Memmott, Director of Audit Services, at Sincerely, Dennis J. Gallagher Auditor DJG/mg To promote open, accountable, efficient and effective government by performing impartial reviews and other audit services that provide objective and useful information to improve decision making by management and the people. We will monitor and report on recommendations and progress towards their implementation.

4 cc: Honorable Michael Hancock, Mayor Honorable Members of City Council Members of Audit Committee Ms. Cary Kennedy, Deputy Mayor, Chief Financial Officer Ms. Janice Sinden, Chief of Staff Mr. David P. Edinger, Chief Performance Officer Ms. Beth Machann, Controller Mr. Scott Martinez, City Attorney Ms. Janna Young, City Council Executive Staff Director Mr. L. Michael Henry, Staff Director, Board of Ethics To promote open, accountable, efficient and effective government by performing impartial reviews and other audit services that provide objective and useful information to improve decision making by management and the people. We will monitor and report on recommendations and progress towards their implementation.

5 City and County of Denver Dennis J. Gallagher Auditor 201 West Colfax Avenue, Department 705 Denver, Colorado FAX AUDITOR S REPORT We have completed an audit of the Denver Motor Vehicle Division (DMV). The purpose of the audit was to assess: the security and adequacy of automated systems, the level of customer satisfaction with Division activities, and the Division s compliance with applicable legal, policy, and procedural requirements. Additionally, the audit explored progressive initiatives the City could implement to further efficiencies regarding the enforcement of license plate and registration tab compliance. This performance audit is authorized pursuant to the City and County of Denver Charter, Article V, Part 2, Section 1, General Powers and Duties of Auditor, and was conducted in accordance with generally accepted government auditing standards. Those standards require that we plan and perform the audit to obtain sufficient, appropriate evidence to provide a reasonable basis for our findings and conclusions based on our audit objectives. We believe that the evidence obtained provides a reasonable basis for our findings and conclusions based on our audit objectives. The audit found that DMV implemented process changes and performance goals in 2012 that reduced customer wait times and identified internal efficiencies. Additionally, internal controls established by executive management ensure accurate cash management and proper safeguarding of assets. We recommend that DMV update its Strategic Plan and performance measures with a focus on implementing outcome metrics that advance continuous improvement already underway within the Division. Further, our Other Pertinent Information section of the audit report identifies inefficiencies in the enforcement of vehicle registration tab compliance in the City, and explores potential opportunities for reducing customer wait times by revisiting statutory requirements for registration tab compliance in the State of Colorado that directly impact Denver citizens. We extend our appreciation to the Department of Finance, DMV management, and all personnel who assisted and cooperated with us during the audit. Audit Services Division Kip Memmott, MA, CGAP, CRMA Director of Audit Services To promote open, accountable, efficient and effective government by performing impartial reviews and other audit services that provide objective and useful information to improve decision making by management and the people. We will monitor and report on recommendations and progress towards their implementation.

6 City and County of Denver Audit Services Division REPORT HIGHLIGHTS Denver Motor Vehicle Division September 2014 The audit assessed the economy and efficiency of the Denver Motor Vehicle Division's operations. Background Colorado law authorizes the City and County of Denver s Motor Vehicle Division (DMV) as an agent of the State to register and title vehicles and to collect, record, and deposit all taxes and fees prescribed for vehicles owned or operated by residents and business owners within the City. DMV has four branch locations to assist in delivering these services to citizens. Purpose The purpose of the audit was to assess: the security and adequacy of automated systems, the level of customer satisfaction with Division activities, and the Division s compliance with applicable legal, policy, and procedural requirements. Additionally, the audit explored progressive initiatives the City could implement to further efficiencies regarding the enforcement of license plate and registration tab compliance. Highlights Finding 1: DMV implemented process changes in 2012 that reduced customer wait times and identified efficiencies within the agency. However, we found that a detailed staffing assessment might further assist DMV in meeting several of its strategic objectives. Further, we recommend that DMV update its strategic plan with a focus on outcome measures that reduce customer wait time while ensuring that customers remain satisfied with the overall DMV process as continuous improvement initiatives are implemented. Finding 2: DMV has established internal controls for cash handling, check management, and the safeguarding of assets. These controls include internal and external reviews, developing processes and procedures to reduce the number of insufficient checks, and properly safeguarding State assets that are managed by DMV. Other Pertinent Information: DMV is limited in the changes it can make to the State-mandated registration tab process. However, our audit has identified potential cost reductions for taxpayers related to administration of the current registration tab process. We found that the City uses an outdated and inefficient enforcement process, relying on manual inspection of registration tabs and registration cards rather than exploring automated technologies. The use of automated license plate readers can be expanded to include title and registration enforcement, but any expansion must balance the privacy concerns of the public. For a complete copy of this report, visit Or Contact the Auditor s Office at

7 TABLE OF CONTENTS INTRODUCTION & BACKGROUND 1 The Denver Motor Vehicle Division 1 SCOPE 8 OBJECTIVE 9 METHODOLOGY 9 FINDING 1 11 The Denver Motor Vehicle Division Should Enhance Strategic Planning and Performance Measurement Efforts that Have Already Resulted in Reduced Customer Wait Times 11 RECOMMENDATIONS 21 FINDING 2 22 The Denver Motor Vehicle Division Has a Sound Internal Control Framework to Ensure Effective Cash Handling and Proper Safeguarding of Assets 22 RECOMMENDATIONS 25 Other Pertinent Information 26 APPENDIX A 38 Denver Motor Vehicle Division 2012 Peak Performance Strategic Plan 38 AGENCY RESPONSE 42

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9 INTRODUCTION & BACKGROUND The Denver Motor Vehicle Division The State of Colorado s Division of Motor Vehicles manages driver s license renewals. The City and County of Denver s Motor Vehicle Division (DMV) acts as an authorized agent of the State to register and title vehicles and to collect, record, and deposit all taxes and fees prescribed for vehicles owned or operated by residents and business owners within Denver. Within the City s organizational structure, DMV is located in the Treasury Division within the Department of Finance. Table 1 provides estimated taxes and fees collected by DMV for 2009 through Sales and Use Taxes Table 1: Taxes and Fees Collected by DMV, Vehicle Owner Tax/Fee Intergovernmental Fees Misc General Government 2009 $16,712,808 $18,074,452 $2,877,725 $6,739,143 $78,743 $44,482, $17,445,861 $17,003,735 $4,421,449 $2,034,376 ($4,814) $40,900, $20,022,535 $17,139,671 $4,409,379 $2,075,896 $17,705 $43,665, $23,721,100 $19,783,847 $4,586,325 $2,072,671 ($33,420) 50,130, $27,111,118 $20,999,533 $4,701,558 $2,299,748 $41,983 $55,153,940 *2014 $26,380,900 $21,417,100 $4,887,200 $2,404,600 $0 $55,089,800 Total Source: Annual Mayor s Budget Book, (actual). Note: Asterisk (*) designates 2014 estimated tax and fee projections. In all but two Colorado counties (the City and County of Broomfield and the City and County of Denver), vehicle title and registration is administered by the county s clerk and recorder s office. When petitioning for legislative changes or representation at the State level, each county s clerk and recorder s office has an equal vote through its representation in the Colorado Clerk and Recorders Association, which represents all sixty-four Colorado counties. To reach consensus on decisions, a collaborative approach must occur to ensure equal representation across the varied interests of each county. Although difficult to quantify, the governance structure of the City and County of Denver may hinder the influence the City has with regard to State title and registration policy. We address the City s organizational structure and the impact it might have on legislative proposals in more detail within the Other Pertinent Information section of this report. DMV Has Four Citywide Branches Denver citizens can conduct DMV business activities at any of the following four branch locations. P a g e 1

10 Northwest Branch 3698 West 44 th Avenue, Denver, CO Northeast Branch 4685 Peoria Street, Denver, CO Southwest Branch 3100 South Sheridan Boulevard, Denver, CO Tremont Branch 2855 Tremont Place, Denver, CO The four DMV branch locations and Processing Center activities include but are not limited to: Processing vehicle and title registration Readying handicap placards and plates Answering phone-bank telephone calls Overseeing and accounting for title batching of daily transacted business and ensuring the proper forwarding of documents to the State of Colorado Division of Motor Vehicles Assisting corporate and fleet customers Processing mail-in requests Assisting customers with changing addresses, transferring names on title, replacing lost or stolen titles, and conducting Vehicle Identification Number checks DMV Utilizes Two Primary Data Systems The Division utilizes the following two data systems in the execution of its duties: Colorado State Title and Registration System (CSTARS) CSTARS is a system owned and administered by the State of Colorado that is used to process all title, registration, renewal, and payment activities. NEMO-Q NEMO-Q is owned and managed by the City and is a customer flow management system that allows customers to track their place in line at one of the four branches. Internally, DMV uses NEMO-Q to track average customer wait times by service type, location, day, and month, among other internal performance measures. DMV Monitors Several Performance Measures DMV monitors its performance in a variety of ways as a result of two recent initiatives. For instance, prior to engaging in process improvement efforts with the Citywide Peak Performance initiative in 2012, DMV management took proactive steps to improve performance in several areas by implementing the Accountability, Consistency, and Efficiency (ACE) program in the beginning of 2012, when the new DMV Director was hired. ACE improvements focused on, but were not limited to, the following areas: Developing a monthly dashboard to serve as a management tool to improve and address communication, employee relations, customer relations, service times, and customer wait times City and County of Denver P a g e 2

11 Creating monthly inventory audits Implementing monthly meetings with employees Established a Branch Council (one voted member from each branch location) to meet with DMV Management on DMV issues every two months Re-establishing customer comment cards Implementing hourly announcements by branch management to help better inform customers Providing clerks with a list of individuals who wrote checks with insufficient funds In addition, DMV worked with the Mayor s Citywide Peak Performance initiative in mid to identify ways to encourage continuous improvement within the organization. 1 According to DMV management some of the ACE proposals were included in DMV s Peak Performance engagement, further improving efficiencies and performance goals. Performance data from 2009 through 2011 served as the performance baseline for both initiatives to assess the degree of improvement achieved. Together, ACE and Peak Performance have established a structure for continuous improvement and laid the foundation for DMV to move closer to its goal of becoming a customer-centric vehicle registration agency. DMV periodically reports mission level performance metrics to the Department of Finance to demonstrate and help improve customer service. DMV s primary performance metrics to measure customer service include average customer wait time, average service time, total customers served, and percent of in-person registration renewals (as compared to online and mail-in renewals). In addition, the primary performance measure reported for the Processing Center s operations is minimizing or reducing the backlog of paperwork from banks and vehicle dealers. These metrics are defined as follows: Average Customer Wait Time The time from when the customer selects a ticket from the NEMO-Q kiosk until the clerk presses the button to call the customer to the counter Average Service Time Begins when the customer s number is called and includes the amount of time it takes to complete a transaction or multiple transactions, ending when the clerk presses the button to call the next customer to the counter Total Customers Served Refers to all customers served in the branch whether for registrations, titles, permits, or annual registration renewals. DMV reports total customers served annually and also tracks annual registration renewal customers served in the branch in order to compute the percent of in-branch customers served metric. 1 Mayor Michael Hancock launched the Peak Performance initiative to support the administration's priorities. Peak Performance uses the LEAN methodology of continuous improvement and provides City employees with the tools they need to solve City problems, eliminate inadequacies, and provide better quality service. P a g e 3

12 Percent of In-Person Registration Renewals Compares the percentage of inbranch customers served against the percentages of mail-in and online renewals. DMV s goal is to increase the percentage of online and mail-in renewals and decrease the percentage of in-branch renewals. Table 2 shows the performance measures and goals DMV reported in the Mayor s annual Budget Book for 2009 through According to the reported data, DMV improved many of its established goals, such as reducing average customer wait time and average service time since Table 2: DMV Customer Service Performance Metrics and Goals, Year Average Customer Wait Time (minutes) Goal Average Service Time (minutes) Goal Customers Served At Branches :35-484, :46-4:35 8:00 490, :17-4:42 5:15 468, :45-4:45 4:20 474, :00 40:00 4:30 4:20 480,000 * :00 25:00 4:00 4:00 480,000 Source: Annual Mayor s Budget Book, (actual). Notes: Asterisk (*) designates DMV s 2014 estimated. - indicates that DMV had not yet defined this performance metric for the year in question. The Purpose of License Plate and Registration Tabs in Colorado According to the American Association of Motor Vehicle Administrators (AAMVA), license plates and registration tabs were introduced in the United States more than a century ago and have primarily been used to display information for fast and accurate identification of a motor vehicle and to demonstrate compliance with motor vehicle registration laws. 2 The AAMVA asserts that the following functions of a license plate have been, and continue to be, the most important features: Displaying information necessary to easily identify a motor vehicle in actual traffic conditions Displaying information (including the registration tab) necessary to show compliance with motor vehicle registration laws 3 Providing an added margin of visibility and safety by making vehicles more visible through use of a bright reflective surface More recently, additional functions of license plates have emerged, such as: 2 American Association of Motor Vehicle Administrators, Best Practice Guide for Improving Automated License Plate Reader Effectiveness through Uniform License Plate Design and Manufacture, CCR defines registration tabs as validation tabs, commonly referred to as stickers. City and County of Denver P a g e 4

13 Providing additional revenue for highway funds, toll authorities, and sponsoring organizations through specialty and vanity license plates Providing access control to parking, facilities, and gated communities Persons registering or titling a vehicle in Colorado pay a variety of registration fees and surcharges, specific ownership taxes, and title fees. Registration fees are based on the empty weight and the type of vehicle. These fees are collected to fund maintenance of Colorado s highways, roads, and bridges as well as to improve air quality, public safety, and emergency medical services. Table 3 shows the eleven fees collected on behalf of the State, which are authorized by the Colorado Revised Statutes, and how the fees are used to improve Colorado s infrastructure statewide. Table 3: Colorado Motor Vehicle Fees with Corresponding Usage Motor Vehicle Fee Types Registration Fee Road Safety Surcharge Bridge Safety Surcharge Public Highway Authority Fee Emissions Control Fees Additional Highway Fee Emergency Medical Services Fee Motorist Insurance Identification Fee Peace Officers Standards and Training (P.O.S.T.) Fee Road and Bridge Fee State of Colorado Use Highway Users Tax Fund Highway Users Tax Fund Bridge Special Fund Applied to financing, construction, or maintenance of public highways Emissions Programs for Department of Public Health and Environment and Department of Revenue (AIR Account) Highway Users Tax Fund Emergency Medical Services Highway Users Tax Fund Motorist Insurance Identification Account Highway Users Tax Fund P.O.S.T. Board Maintenance of highways, roads, and bridges Source: 2011 Colorado Motor Vehicle Law Resource Book. Colorado Laws Governing License Plates and Registration Tabs The Colorado Revised Statutes (C.R.S.) require all vehicles using public roadways to display two license plates, one affixed to the front and one affixed to the back of the vehicle. 4 License plates are issued for multi-year use and are assigned to the owner of the vehicle. Owners must annually renew license plates. If a vehicle is sold by the owner, (1)(a)(I) and (II), C.R.S. P a g e 5

14 state law requires the license plates to be removed and returned to the DMV or recycled by the owner by registering a new vehicle using the set of same license plates. The Code of Colorado Regulations requires that all vehicles using public roadways display two registration tabs issued by the State on the rear end license plate, one to indicate the expiration month and one to indicate the year of expiration. 5 Certain types of vehicles, however, are exempt from this requirement. 6 Registration tabs must be affixed to the rear license plate to prove that registration is current and valid. 7 The annual tab includes a unique control number. The City and County of Denver Has Established Specific Penalties for Expired License Plates and Registration Tabs In Colorado, for those vehicle owners who do not register or renew their vehicle registration, traffic fines are assessed but vary in dollar amount by county, court, and even by case. In the City and County of Denver, a vehicle owner is assessed a $75 fine for lack of title and registration, and late payment penalties apply if the owner does not pay the ticket timely. Collected fines and penalties are deposited into the City s General Fund. Title and registration enforcement is the shared responsibility of the City s Department of Public Works Right-of-Way Parking Enforcement (ROWE) function and the Denver Police Department (DPD), both of which currently rely on visual inspection of registration tabs, rather than using any automated technology to assist with enforcement efforts. 8 In 2013, the City issued more than $8 million in fines from vehicle registration infractions. Table 4 shows the number of citations and dollar value of the associated fines issued from 2009 through 2013 by ROWE and DPD, which collectively write on average 99 percent of vehicle registration infraction citations. Between 2009 and 2010, the value of citations more than doubled, despite a 10 percent increase in the number of citations issued. This was the result of an increase in the fine from $30 to $ CCR (7), C.R.S (1)(b), C.R.S. 8 The current audit scope only included the Department of Finance: Treasury Division. The Department of Public Works and the Denver Police Department were outside the scope of this audit. Although the Other Pertinent Information section of the audit report addresses these departments further, no specific audit recommendations were made to these agencies. City and County of Denver P a g e 6

15 Table 4: City and County of Denver Vehicle Registration Fines by Issuing Entity, License Plate Infractions Total Issued Infractions Issued by ROWE ROWE Issued % Infractions Issued by DPD Issued by DPD % Year Number Value Number Value Number Number Value Number ,073 $ 3,616, ,335 $ 3,390,437 94% 5,280 $ 176,960 4% ,646 $ 7,955,095 99,515 $ 7,472,885 93% 5,231 $ 363,505 5% ,230 $ 7,476,535 95,140 $ 7,174,380 96% 2,874 $ 212,965 3% ,047 $ 7,282,798 94,096 $ 7,056,308 97% 2,056 $ 156,840 2% ,139 $ 8,213, ,314 $ 7,917,655 96% 3,274 $ 251,650 3% Total 531,135 $34,544, ,400 $33,011,665-18,715 $1,161,920 - Source: Right-of-Way Parking Enforcement. Notes: Estimates exclude late payment penalties, etc. Total number of infractions issued exceeds the sum of infractions issued by ROWE and DPD because approximately 1 percent of citations are issued by other entities including, but not limited to, the Colorado State Patrol, the Denver Sheriff Department, and Denver International Airport. Automated License Plate Reader Technology Increasingly, governments have been enhancing the efficiency of their vehicle enforcement practices through the use of automated license plate reader (LPR) technology. These devices use optical character recognition on images taken by a camera within the device to read license plates. An LPR unit can then be connected to a database or several databases to access key information specific to the type of offense the entity may be interested in enforcing. The AAMVA has reported that, since 2007, growth in using LPR technology has increased significantly and is forecasted to expand much further in the next five to ten years. 9 Typical applications for LPR technology by law enforcement, motor vehicle administrations, and other entities include, but are not limited to: Parking enforcement Recovery of stolen vehicles Access control Automatic speed enforcement On street parking enforcement Security monitoring Electronic vehicle registration As of 2014, two out of sixty total ROWE parking meter enforcement personnel with routes throughout the City are using mobile LPRs to store license plate information to enforce parking meter time limits; to check for permits required to use designated parking 9 American Association of Motor Vehicle Administrators, Best Practice Guide for Improving Automated License Plate Reader Effectiveness through Uniform License Plate Design and Manufacture, P a g e 7

16 spaces; and to check a database of license plates associated with unpaid parking tickets to determine whether the owner s vehicle should be immobilized (with a boot) for non-payment. Four additional mobile LPRs are used solely to enforce unpaid parking tickets. The mobile plate reader scans license plates affixed to parked vehicles up to a speed of thirty-five miles per hour. Although LPR technology is not currently used by the City for title and registration enforcement, the City plans to expand its utilization of LPR technology for this purpose in the future. The Other Pertinent Information (OPI) section of this report explores how the City could effectively and efficiently expand LPR technology while balancing the privacy concerns of Denver citizens. There are several variations of LPR systems in use around the country: fixed, portable, mobile, and handheld platforms. The following bullets provide brief definitions of these LPR systems and whether they are used by the City. Fixed LPR System Any LPR system that is permanently mounted on a fixed infrastructure such as overheads, poles, or roadside buildings. These systems are typically used with toll roads, security, and in some federal and local law enforcement applications. Similar technology has been used by DPD in the City s red light photo enforcement cameras. Portable LPR System Any LPR system that can be transported between locations, assembled, operated, and then disassembled. Once deployed, this type of system operates as a fixed platform. This technology has been used by DPD in speed limit radar enforcement. Mobile LPR System Any LPR system that is mounted on a vehicle, including but not limited to a police car, tow truck, street sweeper, or parking enforcement vehicle. This type of system may include one to four camera configurations and is typically mounted on the roof or trunk, or it can be custom manufactured. This technology is typically used by ROWE. Handheld LPR System An LPR system that is held and operated by an individual using another device such as a barcode reader, personal digital assistant (PDA), or smart phone that provides other capabilities, such as communications or internet access. Neither ROWE nor DPD utilize handheld LPR systems. SCOPE Our review entailed an examination of management processes, performance measures, personnel resource needs, best practices, policies and procedures, and data systems utilized by the DMV from January 2009 through July City and County of Denver P a g e 8

17 OBJECTIVE The audit assessed the economy and efficiency of DMV s operations. Audit objectives included an assessment of the security and adequacy of automated systems, the level of customer satisfaction with Division activities, and the Division s compliance with applicable legal, policy, and procedural requirements. In addition, the audit explored progressive initiatives the City could implement to further efficiencies in the enforcement of license plate and registration tab laws. METHODOLOGY The methodologies used in this audit to assess risk and assist with developing and testing the audit objective included but were not limited to the following: Reviewing DMV s current Strategic Plan, webpage on the City s website, Budget Book data from 2009 through 2014, and other DMV documents, including but not limited to current and draft policy and procedures Identifying state laws covering DMV statutory and procedural requirements for title and registration Reviewing the American Association of Motor Vehicle Administrators and other applicable sources to establish best practices, process improvements, and customer services for DMV functions in the State of Colorado and around the country Reviewing DMV Peak Performance report updates released to or through the Department of Finance from 2012 through 2014 and assessing the accuracy of the raw data from NEMO-Q and CSTARS that was used to create these publicly released reports Analyzing the number of DMV s full-time equivalents, process transactions, customer wait times, and customer service times Conducting interviews with: DMV executive management DMV personnel assigned to various DMV data and technological systems administration Right-of-Way Parking Enforcement executive management assigned oversight of parking enforcement State of Colorado Department of Motor Vehicles personnel assigned to executive and administrative oversight of various DMV programs and program revenues P a g e 9

18 Various law enforcement entities in the State of Colorado tasked with automated license plate reader (LPR) oversight and ensuring compliance with license plate and registration tab laws Evaluating budget and strategic planning documents to determine expenditures, revenue, and personnel resource needs covering January 2009 through June 2014 Obtaining title and registration enforcement citations data from Colorado State Patrol Conducting in-person observations of DMV processes at various branch locations around the City Verifying that on-hand license plates and tabs were accurately captured within CSTARS Verifying that on-hand inventory was maintained in a safe and secure location Reviewing various audits conducted by the City s Cash, Risk and Capital Funding Unit Assessing the total number of insufficient checks written to and collected by DMV, which included reviewing the collection process Sampling checking amounts remitted to the State for January through May 2014 Verifying that daily and monthly amounts captured in CSTARS reconciled to PeopleSoft Conducting DMV safe and drawer counts Surveying the State s sixty-four clerk and recorders represented by the Colorado County Clerks Association 10 Benchmarking against DMV organizations located within Colorado and around the country to establish best practices, criteria, and processes used to efficiently and effectively serve the public and reduce customer service wait times. This included states such as Connecticut and New Jersey that attribute reduced DMV costs through modernization efforts including but not limited to the elimination of registration tabs. Researching and analyzing reports discussing citizens privacy rights in government and law enforcement agencies using automated tools, such as LPRs, to enforce local and state laws 10 Auditors received responses from thirteen Clerk and Recorder Offices and one law enforcement agency. City and County of Denver P a g e 10

19 FINDING 1 The Denver Motor Vehicle Division Should Enhance Strategic Planning and Performance Measurement Efforts that Have Already Resulted in Reduced Customer Wait Times The Denver Motor Vehicle Division (DMV) implemented process changes and performance goals in 2012, which reduced customer wait times and identified opportunities for improved efficiency. The Division is currently exploring innovations that may help improve service to customers. This includes a mail campaign initiated in 2014 to better inform customers about available renewal options other than physically visiting a DMV branch. DMV prefers that customer use mail-in or online renewal options due to the proven cost and time savings for both the agency and citizens. We found that the Division can further improve customer service and reduce customer wait times by conducting a detailed staffing assessment that accounts for seasonally adjusted workload, among other factors, as part of the agency s overall strategic planning efforts. In addition, we recommend that DMV update the agency s strategic plan and performance measures with a focus on outcome measures that identify progressive initiatives, which will ensure an environment focused on continuous improvement. DMV Established Several Performance Goals Since 2012, DMV has improved customer service and reduced customer wait times as a result of their internal Accountability, Consistency, and Efficiency (ACE) program and by working with the Mayor s Citywide Peak Performance initiative. Some of the projects that DMV implemented included adding a counter dedicated to serving vehicle dealers, a website redesign with the goal of improving ease of use and functionality, and a dedicated mail campaign to further emphasize that most customers do not need to visit a DMV branch to renew (Figure 1). In collaboration with Peak Performance, DMV developed a Strategic Plan that helped the agency set strategies, estimate timelines for completion, and determine methods for evaluation. To review the plan in detail, see Appendix A. To establish benchmarks and division goals, DMV used customer wait time data from 2009 through Overall, from January 2009 through May 2014, our audit assessed total customer wait time in branch (customer wait time plus customer service time at the counter), customer wait time, customer service time, and transactions processed at DMV branches by total and transaction type: in branch, online, or mail-in. P a g e 11

20 Figure 1: New DMV Registration Renewal Notice Mailer, 2014 Source: Denver Motor Vehicle Division. Note: Some customers may be eligible to pay by telephone through Denver 311. Some of DMV s Performance Measures Have Improved Since 2012 In late 2011, the Mayor suspended mandatory furloughs for DMV staff in an effort to address deteriorating customer service and increasing customer wait time in the City s City and County of Denver P a g e 12

21 four DMV branches. As shown in Figure 2, customer wait time increased from an average of thirteen minutes in 2009 to almost one hour by Since their peak in 2011, the average combined customer wait and service time has gradually decreased due to several factors, which we review in detail below. By May 2014, average customer wait time accounted for approximately thirty-three minutes (88 percent), and average customer service time accounted for approximately four and one half minutes (12 percent) of total time customers spent in DMV branches. Figure 2: Average Customer Wait Time and Customer Service Time in DMV Branch Locations, January 2009 through May :04:48 0:57:36 0:50:24 0:43:12 0:36:00 0:28:48 Service Time Average Wait Time Average 0:21:36 0:14:24 0:07:12 0:00: Source: DMV-reported NEMO-Q data. Note: Data not independently validated. Customer Wait Time Figure 3 shows that average customer wait time has decreased in most months from January 2012 through May Our analysis found that monthly fluctuations may reflect seasonal variations in workload and performance due to such factors as trends in customers vehicle purchases during the period. For example, our team s analysis of data provided by DMV indicates that in summer months (May, June, July, and August), average customer wait times were almost nine minutes longer. P a g e 13

22 Jan-09 May-09 Sep-09 Jan-10 May-10 Sep-10 Jan-11 May-11 Sep-11 Jan-12 May-12 Sep-12 Jan-13 May-13 Sep-13 Jan-14 May-14 Figure 3: Average Customer Wait Time, January 2009 through May :26:24 1:12:00 0:57:36 0:43:12 0:28:48 Wait Time Average 0:14:24 0:00:00 Source: DMV reported NEMO-Q data. Note: Data not independently validated. Customer Service Time As shown in Figure 4, since March 2012, customer service time has increased slightly for customers obtaining renewals, plates, and titles. Although customer service time encompasses several variables, it is largely reflective of the complexity of the transaction being processed. For instance, service times specifically increased for dealers after DMV began allowing dealers to process more transactions per visit in 2009, increasing the transactions per visit allowance from three to five. Additionally, we found that newer employees take longer to process transactions; as DMV has hired new employees, on-the-job training may have been the primary contributing factor to increased service time when viewing average customer service time trends. City and County of Denver P a g e 14

23 Thousands Jan-09 May-09 Sep-09 Jan-10 May-10 Sep-10 Jan-11 May-11 Sep-11 Jan-12 May-12 Sep-12 Jan-13 May-13 Sep-13 Jan-14 Figure 4: Average Customer Service Time by Customer Type, January 2009 through March :12:58 0:11:31 0:10:05 0:08:38 0:07:12 0:05:46 0:04:19 0:02:53 0:01:26 0:00:00 Plate/Titles Renewals Dealers Average Source: DMV reported NEMO-Q data. Note: Data not independently validated. Transactions Processed at DMV Branch Locations Figure 5 depicts the transactions processed by DMV by transaction type from 2009 through Based on this analysis, DMV is processing fewer in-branch renewals. The processing of fewer in-branch renewals at DMV may have also contributed to reduced customer wait times since fewer customers would have needed direct service within the DMV branches. Figure 5: Transactions Processed Annually by Type, 2009 through Sum of Number of Transactions Plate/Titles Sum of Number of Transactions Renewals Sum of Number of Transactions Dealers Sum of Number of Transactions Total Source: DMV reported NEMO-Q data. Note: Data not independently validated. Figure 6 further demonstrates that although online renewals have increased since 2012, most of this increase is the result of previous mail-in customers electing to renew online. P a g e 15

24 Because the majority of DMV s performance initiatives began in 2012, audit analysis focused on registration trends from January 2012 through May This analysis reveals that DMV s efforts to shift customers from in-branch to online or mail-in services has not been as successful as the agency s efforts to shift mail-in customers to online services. Accordingly, DMV needs to continue educating and informing customers about the various renewal options available, with a focus on moving in-branch customers to online renewals. 11 Figure 6: Percent Estimate of Registration Renewals, January 2012 through May % 45% 40% 35% 30% 25% 20% 15% In Branch Mail In Online 10% 5% 0% Source: DMV-reported NEMO-Q data. Note: Data not independently validated. Improved Staffing Assessments Using NEMO-Q Data May Help DMV Further Improve Customer Service and Reduce Wait Times Despite notable improvements in customer wait times and online renewals, we found that DMV s potential for achieving continuous improvement could be strengthened. 12 DMV does not have access to, and therefore is not using, valuable information available within NEMO-Q. We believe that without this raw data, DMV is limited in its ability to perform a more accurate staffing assessment to determine how changes to their current staffing approach could further improve customer wait times and other strategic objectives. 11 To assist in this effort, the Mayor has tasked Peak Performance to work with the State of Colorado to identify options to remove the credit card convenience fee from on-line transactions. Similar initiatives have shown to improve utilization of online services in the City. 12 The City s Peak Academy describes continuous improvement as an environment that emphasizes ways to identify and eliminate waste in a process for the customer, the City, and employees on a daily basis. City and County of Denver P a g e 16

25 DMV collects data through NEMO-Q, which tracks customer wait times by location, day, and month. However, DMV could not provide a multivariate analysis of wait times using NEMO-Q records. 13 Specifically, DMV could not provide NEMO-Q data downloads; system descriptions; a data dictionary (explanation of available data fields); user manuals; systems tests of functionality, validity, or calibration; or any independent assurance of data reliability, all of which are common outputs provided by similar types of data systems. DMV personnel reported they were unable to provide this information due to an on-going system and technological upgrade that coincided with the audit s fieldwork period, which required training and additional subject matter expertise. Where available, auditors independently validated data used by DMV to compile metrics and adjusted or expanded these measures to analyze DMV s overall performance. 14 Without access to all NEMO-Q data, DMV can only estimate how the number of employees working at a DMV branch affects customer wait times or how other factors may affect staffing and wait time. Because of this, auditors were unable to independently validate the NEMO-Q data set provided by the agency. Instead, the team conducted manual observations of customer wait times at the four DMV branches to create a baseline for reliance on information reported by DMV in the aggregate. However, DMV s continuous improvement efforts are limited by a lack of data for critical analysis. We recommend that DMV continue working with their vendor, NEMO-Q, to gain access to raw NEMO-Q data for all four branches. Once the NEMO-Q data set is unlocked for further analysis, DMV can move forward with continuous improvement strategy. For instance, DMV currently maintains a standard work schedule for employees despite the fact that the agency recognizes that in-branch workload can fluctuate daily, weekly, monthly, and seasonally. A staffing model based on peak and non-peak workloads, as identified by NEMO-Q data, might allow DMV to create a more systematic staffing approach or staffing forecast model that allows the agency to further reduce customer wait times by staffing according to projected workloads. A flexible staffing approach could help significantly reduce customer wait times. For instance, DMV could begin exploring a flexible staffing approach that might include seasonal hires, part-time employees, or a dedicated series of employees for specific functions or periods of the year. Alternatively, DMV might manage operations differently when wait times exceed a pre-determined limit. To assist in this effort, we conducted a preliminary analysis of the limited summary of NEMO-Q data that was available during the audit. We found that the upward spike from 2009 to 2011 for wait time was highly correlated with staffing levels, yet the steady decline in wait time since 2012 is only somewhat correlated with staffing levels. Specifically, staffing accounted for 80 percent of the variance in increasing wait times between 2009 and 2011, but staffing only accounted for 44 percent of the variance in decreasing wait times from 2012 to present. Other factors contributing to the March A multivariate analysis is a technique that reviews a set of data with more than one variable that might have impacted the outcome(s). 14 DMV planned to conduct internal training on the upgraded system subsequent to the audit period. P a g e 17

26 to June 2014 decrease may have included: staff experience, actual number of customers visiting the branches, sales of motor vehicles in the State, as well as DMV s ACE and Peak Performance initiatives. For example, an assessment of vehicle sales in the State of Colorado conducted by auditors found that for every additional 1,000 cars sold in the state, average wait times will increase by two minutes. These represent two of many variables that DMV could assess as part of their staffing analysis and performance measure implementation. However, without the complete population of raw NEMO-Q and transaction data to assist in our analysis, auditors were unable to independently validate and isolate additional potential variables that might contribute to increasing or decreasing customer wait times and other performance measures. We recommend that DMV collaborate with the Office of Human Resources to conduct a multivariate regression analysis of staffing that compares the agency s overall performance against contributing variables to determine actual staffing needs and potential flex schedules that may benefit the agency and customers. Variables that should be assessed as part of the staffing assessment may include, but need not be limited to, seasonal and economic factors, such as the number of new and used cars purchased annually, trends and types of transactions processed at DMV, as well as population changes in the City over time. Without this analysis, DMV will be unable to support varied staffing or tailored initiatives focused on driving in-branch customers to other renewal options, as well as ensuring that DMV is successful in achieving other strategic goals. Targeted Performance Metrics Can Ensure that DMV Continues to Improve Customer Wait Times, Enhance Customer Satisfaction, and Implement Forward-Leaning Processes We found that DMV is limited in the type of measures it is using to assess its performance. By focusing on output measures, rather than outcomes, DMV cannot holistically assess the quality of its customer service. As noted, DMV s current strategic plan was created in 2012 during the agency s work with the Mayor s Peak Performance initiative. While this was a stellar effort, DMV has no plans to update the plan, since most of the action items from the plan have already been completed. Although full implementation of a strategic plan is commendable, a true continuous improvement process requires constant revisiting. An updated strategic plan would assist DMV in meeting its vision of becoming, a premier vehicle registration and licensing agency in the State of Colorado. 15 Traditionally, a strategic plan is used as a vehicle for clearly identifying and conveying strategic goals, how those goals will be achieved, and finally, how those goals will be measured through a variety of performance metrics. Based on our research, other DMV organizations have implemented some additional tools that the City s DMV has not yet implemented. For example, some of the locations we benchmarked are using their websites to provide real-time information about wait times and the number of customers waiting for each transaction type. Regardless of the improvements DMV chooses to pursue, the next phase in the agency s progress should 15 Denver Motor Vehicle Division 2012 Peak Performance Strategic Plan, Appendix A. City and County of Denver P a g e 18

27 focus on overall customer satisfaction with the agency. Additionally, as the Division addresses current recommendations, the Other Pertinent Information section of this report introduces an opportunity for DMV and the City to begin exploring potential changes that could expedite DMV s efforts to become a citizen-centric agency through improved efficiencies, cost savings, and technological innovation. DMV Reports Process Outputs Rather Than Outcomes An output is a type of performance measure that looks at the amount of a product or service provided by an organization to customers. An outcome, on the other hand, measures the result of program efforts and resource expenditures. 16 The audit team found that DMV s current approach to measuring internal performance is mostly focused on outputs, rather than also assessing outcomes. While both measures are important to understanding performance, relying on one or the other may limit successful implementation of strategic objectives. For instance, one of DMV s current output-based performance measures looks at the number of errors returned from the State; DMV does not, however, measure other error variables to assess the impact such errors may have on customers. To do so, DMV would need to introduce an outcome-based measure such as the number of times customers must return to DMV as the result of an error. Although DMV has not traditionally reviewed both outputs and outcome-based performance measures, the agency did implement customer comment cards in 2012 to gather customer feedback. Because the agency does not trend customer responses, auditors sampled customer comment cards received for This sample of comment cards found a generally favorable impression of the DMV branches by customers. A follow-up survey or assessment of customers that specifically measures and trends DMV s customer service has not been conducted, but might assist the agency in ensuring that it continues to meet customers evolving needs and identifying trends early on, which might indicate more immediate strategic changes need to take place. Without robust customer service and satisfaction trend data, DMV cannot verify that recent improvements, such as the reduction in customer service time, directly impacted customer satisfaction. DMV can balance performance goals with improved quality of service and accuracy of transactions. As each outcome-based performance metric improves, overall customer satisfaction should improve as well. For instance, reduced customer wait and service times will equate to improved overall customer satisfaction only when both of these output-measures align with the needs of customers visiting DMV branches. The Division Has No Formal Plans to Update its Strategic Plan DMV has successfully completed many of the tasks identified in its 2012 Strategic Plan, a four-page outline that guided DMV s performance improvement efforts. Although Strategic Plan tasks have been addressed, the elements of the plan that focus on wait time and percentage of in-branch transactions do not guarantee improved customer service. Further, the focus of ACE, while effective, did not explicitly address customer 16 Denver, Police Department Administration Performance Audit, Finding 1, February 2013, P a g e 19

28 service and quality; instead the initiative focused on agency-specific efficiencies. Conversely, we found that the State of Colorado s DMV might serve as a model for further analysis by the City s DMV, based on differences between their respective strategic planning approaches. While DMV s 2012 Strategic Plan addressed one year, the State DMV s Strategic Plan covers multiple years 2013 through 2017 and contains several specific outcome-driven performance measures. As an agent of the State, DMV s updated strategic plan would need to balance the strategic goals of the City with forthcoming changes at the State, such as the request for proposal for a new CSTARS system. 17 The State notes that a five-year strategic plan was developed to act as a roadmap for the Division to achieve higher levels of performance and will be used as a tool for transformative process change; the State DMV considers one-year assessments potentially limiting. A multi-year strategic plan may better assist the City s DMV with developing performance metrics that take into account present objectives as well as initiatives that might take several years to implement. As an agent of the State and a subsidiary of the Department of Finance, DMV should work collaboratively with the Department of Finance to update the agency s strategic plan to cover multiple years and incorporate targeted performance metrics that include a balance of wait time reductions, customer service, and addressing overall customer satisfaction. 17 At the time of the release of this audit report in September 2014, the State of Colorado was still in the process of reviewing request for proposals (RFPs) submitted by potential vendors. City and County of Denver P a g e 20

29 RECOMMENDATIONS We offer the following recommendations to help the Denver Motor Vehicle Division link resource needs to strategic initiatives with improved wait times and customer service. 1.1 DMV should continue working with their vendor, NEMO-Q, to gain access to raw data for all four branch locations. 1.2 DMV should collaborate with the Office of Human Resources to conduct a multivariate regression analysis of staffing that compares the agency s overall performance against contributing variables to determine actual staffing needs and potential flex schedules that may benefit the agency and customers. Variables that should be assessed as part of the staffing assessment may include, but need not be limited to, seasonal and economic factors, trends and types of transactions processed at DMV, as well as population changes in the City over time. 1.3 DMV should work collaboratively with the Department of Finance to update the agency s strategic plan to cover multiple years and incorporate targeted performance metrics that include a balance of wait time reductions, customer service, and addressing overall customer satisfaction. P a g e 21

30 FINDING 2 The Denver Motor Vehicle Division Has a Sound Internal Control Framework to Ensure Effective Cash Handling and Proper Safeguarding of Assets The Denver Motor Vehicle Division (DMV) has taken proactive steps to improve performance and operations, as well as establish internal controls for cash handling, check management, and the safeguarding of assets. Internal controls in place include internal and external reviews, developing processes and procedures to reduce the number of insufficient checks, and properly safeguarding State assets managed by the City. DMV Has Several Internal and External Controls for Cash and Asset Management Our review determined that DMV has sound internal and external controls and safeguards surrounding cash handling and inventory management. Additionally, DMV s check review and collection process appears to be working effectively. DMV Has Established Sound Internal Cash Handling Controls Each DMV branch utilizes the Colorado State Title and Registration System (CSTARS), a State system, to capture transaction activity and to ensure that the amounts collected are accurate and accounted for on a daily basis. While DMV branch managers are responsible for ensuring that the branch s transactions reconcile to CSTARS, DMV clerks are responsible for ensuring that their individual cash drawer balances are accurate. DMV has also implemented accounting processes that require branch managers to submit daily branch activity for the previous day by 11:00 a.m., which allows for timely reporting and review of revenue collected. DMV accounting staff is required to review and ensure that all amounts are accurately accounted for within CSTARS. Any corrections are captured in CSTARS, which does not allow for the deletion of records, only corrections. Therefore, all adjustments are automatically documented and stored within CSTARS. Based on our random review of daily and monthly accounting activities, including monthly amounts remitted to the State, no variances were identified. Lastly, DMV s accounting staff conducts quarterly surprise safe and cash handling audits, and branch managers conduct dual safe counts each week. Safe counts are documented and maintained for future review should discrepancies arise. Division Internal Controls Are Enhanced by External Cash Handling Reviews and Audits To further assist with properly controlling for cash handling processes and procedures, DMV is subject to several internal and external reviews. Throughout the year several random internal and external cash and inventory audits are conducted. For instance, City and County of Denver P a g e 22

31 DMV is audited twice per year by the City s Department of Finance: Cash, Risk and Capital Funding Unit (Unit), which is responsible for Citywide oversight of change fund administration. This includes conducting surprise cash counts and change fund audits of safe and cashier drawers. The Unit also reviews receipting and change fund policies and procedures with the change fund administrators and cashiers to ensure compliance, provides training when needed, and assesses internal controls surrounding cash handling in the City. Additionally, DMV accounting staff also performs surprise audits, which include a review of inventory on hand, accuracy of safe funds, and individual cash drawer counts. Based on our review of audits performed and discussions with the Cash, Risk and Capital Funding Unit and DMV accounting management, there were no significant issues or concerns identified. DMV s Collection Rate for Insufficient Checks Is High Our audit assessed the number and percentage of insufficient checks DMV referred and collected from 2009 through March DMV accepts payments in the form of cash, check, and credit card. As with any operation that accepts checks, a percentage of check payments received will lack sufficient funds. However, DMV has implemented procedures to reduce the number of insufficient checks received, and the Division uses the City s Asset Recovery Program to assist with collecting outstanding amounts. Specifically, DMV has created an Insufficient Check List for each clerk to increase the likelihood that DMV can avoid being written insufficient checks. 18 When a customer writes a check, the clerk will review the Insufficient Check List to verify whether the individual has written an insufficient check to the agency in the past. If it is determined that the individual has written two insufficient checks in the past, the clerk will request another form of payment. If an insufficient check is written by a person not on the Insufficient Check List, the City s bank attempts to process the payment by running it through the customer s bank account two additional times. If the check still does not clear, the check is deemed Dead and DMV is notified. Once DMV is notified about an insufficient check, the Division cancels the registration and license plate through the CSTARS system. The check and the customer s contact information are then forwarded to the City s Asset Recovery Program for processing. 19 The Asset Recovery Program provides key information to the City s contractor, Machol & Johannes, to conduct all collection activities. Machol & Johannes issues a letter to the customer informing him or her that the check did not clear and to contact Machol & Johannes to pay the amount due, plus any additional processing fees. As shown in Table 5, the total dollar amount of checks referred to the Asset Recovery Program from 2009 through March 2014 totaled $901,217, and the total amount collected was $771,973 (85 percent). Based on the overall 18 Insufficient Check: a check drawn on a non-existent account or on an account with insufficient funds to honor the check when presented. 19 The Asset Recovery Program is administered by the Department of Finance for collection purposes. Any City agency that collects revenue can utilize the Program at no additional cost to the agency, as the collection cost is passed through to the customer. P a g e 23

32 collection rate, we believe that DMV is properly managing insufficient check collection activities. Table 5: Insufficient Fund Checks Referred and Percentage Collected, January 2009 through March 2014 Year Number of Checks Collected Amount Referred Amount Collected Percent Collected $300,493*** $162,668 54% $157,303 $129,752 82% $114,479 $129, %** $126,477 $149, %** $167,797 $157,981 94% 2014* 119 $34,668 $42, %** TOTAL 2,987 $901,217 $771,973 85% Source: Department of Finance: Asset Recovery Program. Notes: *Only includes 1 st Quarter of **Percentage collected may be greater than 100 percent due to amounts being collected from the previous month. ***Noticeable spike in 2009 can be partially attributed to the national recession and economic downturn. DMV Has Taken Steps to Ensure that Assets Are Properly Safeguarded In addition to cash and check handling controls, DMV has implemented several measures to ensure that it is properly accounting for State-issued license plates, permits, and tabs. On a monthly basis, DMV s stock keeper collaborates with each branch manager to conduct a full inventory of license plates, permits, and tabs. This review includes comparing and verifying that the on-hand inventory count reconciles with CSTARS. Any variance must be documented and accounted for to ensure accurate inventory levels. Based on our review of two DMV branches, we found that each DMV clerk maintains his or her individual inventory in a secure location, control numbers are assigned to all inventory for tracking purposes, and on-hand counts are accurately reflected within CSTARS. This reconciliation process makes it easier for management to identify and locate discrepancies and to ensure that inventory levels are being properly managed. Furthermore, the State also conducts inventory reviews. A 2012 inventory review conducted by the State did not identify any significant inventory issues. Overall, DMV s inventory assessment was rated as Excellent, meaning that product inventory was sufficient to meet any unusual demands for inventory based on historic usage, and on-hand inventory was properly maintained and reported by DMV. City and County of Denver P a g e 24

33 RECOMMENDATIONS Finding 2 has no recommendations. P a g e 25

34 Other Pertinent Information The City Can Reduce Inefficiencies within the State-Mandated Registration Tab Process As an agent of the State of Colorado, the Denver Motor Vehicle Division (DMV) is limited in changes it can make to the registration tab process, which is governed by the State. However, our audit identified opportunities to achieve cost savings for City and State taxpayers by enhancing the current registration tab process, which would reduce or eliminate: Time and costs spent by in-branch DMV customers obtaining registration tabs on an annual basis City and State DMV personnel costs related to performing manual inventory controls Direct costs of manufacturing registration tabs and envelopes for delivery, paid as a unit cost to the Colorado Department of Corrections 20 Opportunity costs of hindered modernization efforts at the City s four DMV branches, which affect customer service goals and performance metrics Additionally, we found that the City s vehicle registration enforcement process is inefficient because it relies on manual inspection of registration tabs and registration cards. The use of automated license plate readers (LPRs) predominately used by the City s Department of Public Works Right-of-Way Parking Enforcement (ROWE) function during the audit period could be expanded to include title and registration enforcement, resulting in efficiencies and cost savings. Finally, due to the statewide nature of vehicle registration enforcement, we explored avenues for inter-county collaboration that would be required to expand the application of technology-based registration tab enforcement throughout the State. We found that significant political hurdles likely exist, and the consideration of surrounding jurisdictions many of which allocate enforcement through differing agencies and means of enforcement than the City and County of Denver must be given equal consideration before any legislation could be proposed at the State level. The State Incurs Costs To Maintain the Vehicle Registration Tab Process The Colorado Department of Revenue has contracted with the Colorado Department of Corrections to supply the month and annual registration tabs required by State law. 21 The annual registration tabs are placed into window envelopes by inmates housed in State 20 The Colorado Department of Corrections contracts with an independent manufacturer to create and deliver the monthly and annual registration tabs (stickers) CCR City and County of Denver P a g e 26

35 correctional facilities. For these various services, the Department of Revenue pays the Department of Corrections a unit cost of 11 cents for each month tab and 17 cents for each annual tab. 22,23 In total, the direct manufacturing and supplies cost to the State is approximately $1 million dollars per year. These costs are passed on to citizens through direct sales. Table 6 provides a breakdown of costs to the State for the month and annual registration tabs. Table 6: Cost of Registration Tab Orders for the State of Colorado, CY 2009 CY 2010 CY 2011 CY 2012 CY 2013 Month Tab Cost $0.11 $0.11 $0.11 $0.11 $0.11 Month Tab Quantity Ordered Month Tabs Total Cost 2,065,742 2,102,592 1,648,079 1,151,855 1,202,480 $227,232 $231,285 $181,289 $126,704 $132,273 Annual Tab and Envelope Annual Tab and Envelope Quantity Ordered Annual Tab and Envelope Total Cost $0.17 $0.17 $0.17 $0.17 $0.17 5,576,652 5,519,474 4,883,480 5,946,123 5,759,727 $948,031 $938,311 $830,192 $1,010,841 $979,154 Total Cost of Month and Annual Tabs $1,175,262 $1,169,596 $1,011,480 $1,137,545 $1,111,426 Source: State of Colorado Department of Revenue. County DMV Personnel across the State Must Dedicate Time to Inventorying Registration Tabs Each county DMV is responsible for inventorying and distributing applicable registration tabs. First, boxes of registration tabs are sent by the State to a centralized warehouse, which is audited monthly by a warehouse clerk and checked against the Colorado State Title and Registration System (CSTARS). Additionally, like license plates, the State mandates that each county is criminally liable if a series of registration tabs are, or an 22 The annual tab unit cost of 17 cents includes the envelope and manual labor (inmate) costs. 23 The manufacturing of tabs and envelopes is contracted out by the Department of Corrections to a third party. This contractual relationship was beyond the scope of this audit engagement. P a g e 27

36 individual tab is, not accounted for, lost, or stolen. This liability extends to individual DMV employees. Therefore, strict inventory controls are employed by both the State and county DMVs. For example, in the City, although the CSTARS system automatically controls the sequence of registration tabs, DMV personnel estimate that each of the four DMV branch locations dedicates between five and six hours per month to auditing the registration tab and license plate inventory. If we reasonably assume that half of DMV personnel s inventory control time is for registration tabs, this translates into approximately ten to twelve hours of staff time spent each month on inventory controls. These redundant inventory controls reduce the hours available for DMV clerks and management to dedicate to in-branch customer service. Although the State introduced Print-On-Demand license plate delivery in 2014 to reduce on-hand inventory of specialty license plates, reduce potential asset loss, and improve customer service, our analysis suggests that eliminating registration tabs may further reduce personnel hours dedicated to inventory controls at DMV warehouses and branches, allowing DMV branches the opportunity to reallocate personnel hours towards other strategic objectives. Visiting a DMV Branch To Ensure Registration Tab Compliance Is the Most Time Consuming Activity for Customers State statute requires vehicle owners to renew their vehicle registration annually. Typically, each county s DMV office notifies its vehicle owners by mail thirty days prior to the expiration date, allowing owners an additional thirty-day grace period to renew. 24 As discussed in Finding 1, through the Peak Performance and ACE initiatives, Denver s DMV offices have attempted to educate and motivate vehicle owners to renew online or through the mail to reduce customer wait times for in-branch visitors. For citizens who cannot meet the deadline, or cannot afford the renewal fees until the deadline is reached, the requirement to obtain registration tabs is a deterrent to reducing in-branch visitors. Obtaining registration tabs in-branch costs citizens the most time because this process includes the customer s drive time, wait time, and transaction time spent at the designated DMV branch. In Table 7, we attempt to quantify the costs to citizens to renew their registrations in-branch based on monthly average wait-time data obtained from NEMO-Q the City s DMV queuing system from January 2012 through December Although state statute does not require DMVs to notify customers, many county DMVs send renewal notices as a customer service. City and County of Denver P a g e 28

37 Table 7: Annual Estimated Costs to Citizens to Renew Registrations In-Branch, Total Avg Branch Time (Min) Assume Drive Time (Min) Total Time for In- Branch Visit (Min) Per Capita Hourly Rate ($) Cost for Each Renewal Customer ($) Citizen Cost of Inbranch Customer ($) No of Inbranch Month/Yr Renewal Jan , , Feb , , Mar , , Apr , , May , , Jun , , Jul , , Aug , , Sep , , Oct , , Nov , , Dec , , Jan , , Feb , , Mar , , Apr , , May , , Jun , , Jul , , Aug , , Sep , , Oct , , Nov , , Dec , , Avg Total time in 2012/13 7,475, Source: Auditors calculations were derived using DMV provided NEMO-Q data from 2012 through Notes: Per capita income sourced from Statista, an on-line statistics portal per capita income is also used in 2013 as data for 2013 was unavailable prior to this audit report s release. Per Capita Hourly Rate is the 2012 Average Per Capita Income of Colorado divided by 2,080 standard work-year hours. Estimated Costs to Citizens for In-Branch Renewals As shown in Table 7, the inbranch renewal process includes an assumed average twenty minute drive to a 25 Formula: Total average In-Branch time (includes Wait and Service Time) + assumed average drive time multiplied by Per Capital Income Hourly Rate (2012 Average Per Capita Income/2080 standard work-year hours) multiplied by average number of in-branch customers renewal customers = Total Cost to Renew for In-Branch Renewals. Example Dec 3013: 31 minutes total inbranch wait time + 20 minutes drive time = 51 minutes total time in-branch transaction multiplied by $22.01 per hour = $18.71 cost of renewal multiplied by 11,802 in-branch renewals totaling $220, accessed July P a g e 29

38 City DMV office. Our analysis also accounted for average customer wait time in the lobby and average customer service time spent at the counter to complete the transaction obtained from NEMO-Q data provided by DMV. Each of these times are added together and multiplied against an hourly rate derived from the State of Colorado s 2012 average per capita income ($45,775) based on a standard 2,080-hour work year. Lastly, this rate is multiplied against the monthly inbranch renewals conducted by customers each year. In summation, for 2012 and 2013, cost to citizens visiting DMV branches to renew their registration cost them approximately $7.5 million, or $3.75 million annually, representing approximately two hours of total time for each citizen. Estimated Costs to Citizens for Mail-in and Online Renewals For mail-in renewals, we assumed that a citizen spends approximately ten minutes preparing a check and finding an envelope and stamp. Using these assumptions and the parameters outlined above for costs, customers spent approximately $473,000 worth of time in 2012 and 2013 for mail-in renewals. 27 Online renewals are also assumed to require approximately ten minutes for filling in fields with required payment information (personal information is automatically populated after entering the license plate number). Based on these assumptions, on-line renewal customers spent approximately $660,000 worth of time in 2012 and In total, the combined time spent by Denver citizens to complete their vehicle registration is approximately $8.6 million for 2012 and 2013, averaging $4.3 million a year. 29 DMV s Peak Performance initiatives have established a goal of reducing in-branch registration from 50 percent to 40 percent, and increasing mail-in and online renewals from 25 percent to 30 percent each for If those goals are realized, a savings of approximately $496,000 may be realized in time costs to citizens. Continuing with prospective assumptions, if registration tabs, registration cards, and online transactions fees were eliminated, potentially 50 percent of renewals could be performed online, with another 25 percent of customers using the mail-in option and the remaining 25 percent requiring in-branch transactions. In this scenario, cost to the citizens would have dropped to $6.0 million for the two years, 2012 and 2013, or $2.6 million in time savings for citizens Formula: Total average online time: (assumes ten minutes which includes entry of license plate number and credit card information multiplied by Per Capital Income Hourly Rate (2012 Average Per Capita Income/2080 standard work-year hours) multiplied by average number of on-line transactions reported by Colorado Interactive to DMV = Total Cost to Renew for Online Renewals. 28 Formula: Total average mail-in time (assumed ten minutes to write a check, find an envelope and stamp and place in mailbox) multiplied by Per Capital Income Hourly Rate (2012 Average Per Capita Income/2080 standard work-year hours) multiplied by average number of mail in customers from statistics obtained from the processing center = Total Cost to Renew for mail-in Renewals 29 Formula: Total Cost to Citizens: Average In-Branch, Mail-In and On-line renewals. 30 Totals shown in Table 7 assume the number of customers visiting DMV branches remains constant. A 2012 survey of DMV customers indicate that this amount may decrease by as much as 22 percent if the state-mandated registration tab requirement was eliminated. City and County of Denver P a g e 30

39 In summary, our assumptions attempt to quantify and compare current costs to citizens for complying with state-mandated registration requirements and identify potential opportunities for cost-savings. These assumptions are not all inclusive and rely on conservative estimates of costs to Denver citizens. Our review indicates that eliminating the need to collect registration cards and affix manual registration tabs could significantly reduce the need for many citizens to visit a DMV branch. Such implementation efforts might be accelerated if citizens are educated on opportunities for efficiencies gained through automated enforcement and automated notification of payment through online or mail-in. Over time, it is also reasonable to assume that mobile phone payment options could further reduce both mail-in and physical branch transactions than in the prospective assumptions outlined above. Eliminating Registration Tabs Provides an Opportunity to Improve Customer Service Across the country, some DMVs are considering eliminating, or have already eliminated, registration tab requirements resulting in efficiencies, cost savings, and expedited modernization efforts. A survey conducted as part of a 2012 Capstone study performed for DMV indicates that some customers primary justification for visiting a DMV branch was to obtain the registration tab or registration card, meaning that there may be an immediate opportunity for DMV to further its goals of moving this population of customers to online and mail-in renewal options instead of in-branch services. 31 Some DMVs Nationwide Have Already Eliminated Registration Tab Requirements A Pennsylvania Department of Transportation report, entitled Evaluation of the Use of Registration Stickers, notes that Quebec, Canada, Connecticut, and New Jersey have all eliminated both license registration tabs and windshield stickers for title and registration in the past decade. 32 The Program Manager of Connecticut s DMV Modernization Office stated that the elimination of the registration tabs saved the state approximately $1 million annually, representing combined savings in manufacturing, storage, and distribution costs. Furthermore, the Program Manager indicated that modernization efforts to improve DMV functions at branches were expedited through the elimination of manual registration tab requirements. Currently, Connecticut vehicle owners, by law, must be mailed an invitation to renew. The renewal form offers citizens the opportunity to complete the transaction by mail, online, or by visiting a DMV branch. In 2014, continuing modernization at Connecticut s DMV will result in an offer to vehicle owners to elect -only invitations for renewal. 33 This change will save Connecticut the costs associated with paper stock, printing, and postage for each citizen who elects to opt-in to the invitation alternative. The new system will also allow fleet owners to 31 A Capstone study refers to the report or thesis fulfilling the requirement for completion of a graduate school degree program. 32 Evaluation of the Use of Registration Stickers, The Pennsylvania Department of Transportation, April 18, 2010, 33 The Connecticut State legislature bound all vehicle owners to pay prior registration fees from the previous year prior to allowing any new vehicle registrations. P a g e 31

40 conduct renewal registrations online. The Program Manager indicated that most municipalities within the state are equipped with LPRs of varying types to enforce title and registration, and the majority of enforcement is performed by the state police. Additionally, Connecticut s DMV empowers citizens by offering an online portal where users can enter a license plate number to determine whether it has a current registration. While ambitious, the elimination of registration tabs has allowed Connecticut to advance in areas that may be hindered in the State of Colorado and the City and County of Denver under current legal restrictions. 34 A Prior DMV Survey Found Many Customers Visit the Branches Only To Obtain Registration Tabs and Cards In 2012, DMV was the focus of a Capstone study, entitled Cutting Customer Wait Time and Improving Customer Service Satisfaction at Denver Motor Vehicle Division. The study was conducted by a University of Colorado Denver student as part of a School of Public Affairs Advanced Seminar in Public Policy and Management. The survey was not statistical and relied on in-person interviews with citizens visiting the branches. However, DMV relied on the study s results to make agency improvements since it provided insight into customers behaviors. Based on 157 respondents, the study revealed the following reasons why citizens elect to use in-branch DMV services: Twenty-three respondents (15 percent) waited too late to register and needed to obtain their registration tabs to affix to the license plate to avoid citations. Four respondents (2.5 percent) wanted to receive the sticker sooner after making payment Seven respondents (4.5 percent) stated that they did not trust the mailing process One respondent (1 percent) did not receive the sticker in the mail after payment was made. The survey also notes that some citizens enjoy doing business in person. For instance, 10 percent of respondents just feel like coming by to interact with people. Another 3 percent prefer to use cash rather than providing credit card information. Another 13 percent live or work near a physical branch. However, based on these survey results, eliminating the statutory requirement to obtain registration tabs to prove payment of registration fees could potentially reduce in-branch traffic by as much as 22 percent. 35 An opt-in renewal notification, expansion of the City s data-mailer program, or ed registration opportunities confirming receipt of payment could also further reduce in-branch traffic, which has shown a direct correlation to reduction in customer wait times in DMV branches CCR : The Code of Colorado Regulations requires that all vehicles using public roadways display two registration tabs issued by the State on the rear end license plate, one to indicate the expiration month and one to indicate the year of expiration. 35 The twenty-two percent assumption is based on the accumulated total of respondents in the following areas: 23 (15%); 4 (2.5%); and 7 (4.5%). City and County of Denver P a g e 32

41 Title and Registration Enforcement Can Be Automated To Improve Efficiency and Compliance Title and registration enforcement in the City is primarily managed by the Department of Public Works Right-of-Way Parking Enforcement function (ROWE). Presently, ROWE uses manual inspection to enforce compliance. If this process were automated, there is an opportunity for increased efficiency, increased revenue, and enhanced compliance with state and local laws. LPRs Allow for More Efficient Vehicle Registration Enforcement As noted in the Introduction & Background section of this report, ROWE agents write 95 percent of vehicle registration enforcement citations in Denver, representing nearly $8 million dollars in revenue for the City s General Fund in As of June 15, 2014, the State s CSTARS program showed the following figures for the City and County of Denver: 900,454 registration records 523,408 registered vehicles 361,572 vehicles with expired registration 36 It is not possible to confirm the number of citizens driving unregistered vehicles, since the City s DMV would have to purge its registration records on a set schedule, such as annually. However, DMV has made the policy decision to maintain vehicle registration records for a longer period of time to ensure that the Division has historical access to citizens records. Therefore, the expired registration total noted above does not reflect the actual number of citizens not in compliance with State law, since it might include plates of citizens who have moved out of Denver or sold their vehicles, or license plates that have been removed from a vehicle but not returned to DMV as required by law. Similar to any automated system, once flagged, additional steps must be taken by law enforcement officials to validate an actual violation has occurred. Currently, ROWE does not use LPRs to identify expired plates or registration tabs, instead relying on agents visual inspections. ROWE will continue to add LPRs to assess parking meter infractions, assess stolen vehicle hot lists, and enforce unpaid parking citations. However, the Manager of ROWE approximates that adding an expired registration hot list to the LPRs could result in a 15 percent efficiency increase in registration citations, since the LPR would automatically signal to the agent that a vehicle s registration tabs are expired. Based on 2013 ROWE citations, a 15 percent efficiency increase could result in approximately 16,000 citations or approximately $1.2 million in additional annual revenues. 37,38 36 This total includes the amount of vehicles captured by DMV since the data was last expunged by the City. The City does not expunge data on a set schedule but rather relies on the strategic needs of the agency and policy decision of Management. 37 The $1.2 million in estimated additional revenue is based on the City s current expired registration fine of $75 ($75 x 16,000 = $1.2 million). 38 As with most automated programs, revenues may eventually plateau as citizens become aware of newer technologies used to enforce compliance with local laws, which in this instance reflects the inverse relationship between annual citations and the goal of expanding compliance with license and registered vehicle laws. P a g e 33

42 To be more efficient in enforcement, ROWE will need to work with the City s DMV to create an unregistered vehicle hot list. We believe this list should be uploaded nightly into the ROWE LPR database to ensure that agents are using the most up-to-date information. Additional decisions would need to be made regarding whether ROWE should obtain a hot list strictly for registered City and County of Denver residents or obtain a hot list of all unregistered vehicles, which might include the Denver Metro area, the State of Colorado, and all states through a national database. ROWE s LPR Vendor, Xerox, estimates a single hot list can hold up to 2 million entries. An analysis would need to be done to determine the best use of vehicle registration hot lists and the performance, or limitations, of available technology using larger datasets. Although ROWE is the main enforcer of license and registration tabs in the City and County of Denver, Table 8 demonstrates that LPRs are used by a variety of agencies to assist with city and state law enforcement functions. Our research indicates there may be opportunities to improve the efficiency and effectiveness of title and registration in jurisdictions not limited to the City and County of Denver. Table 8: Example LPR Usage in Colorado Locality Aurora Police Department Boulder Sherriff/City Police Denver Police Department DIA Parking Colorado State Patrol LPR Use Stationary cameras to identify stolen vehicles, as well as investigative tools in solving other crimes Mobile units obtained by grant monies used to identify stolen vehicles, as well as investigative tools in solving other crimes Stationary cameras for red light photo enforcement; Mobile radar speed photo enforcement Fixed cameras inventory of cars entering and leaving DIA public parking facilities Mobile units to identify stolen vehicles, sex offenders list, and to assist in on-going investigations Title/Registration Enforcement Method Manual Visual Inspection Manual Visual Inspection Manual Visual Inspection Not Performed Manual Visual Inspection Source: Auditor analysis. Automated Enforcement May Be Seen As Intrusive by the Public As LPRs are used more often to promote efficiency in law enforcement around the country, citizens privacy concerns must be addressed. An example of this concern was recently debated by the Colorado General Assembly as it pertained to the potential City and County of Denver P a g e 34

43 elimination of automated red light and radar photo enforcement in Colorado. 39 Although automated enforcement of title and registration may be seen as a revenue generator, citizens require that government do more through the efficient and practical exercise of their tax dollars. In this instance, using LPRs to enforce title and registration is the most efficient use of City resources to encourage compliance with local laws. Specifically, ROWE s internal analysis estimates that LPR equipment has a return on investment of approximately six weeks. This means that the cost of LPR equipment is fully covered within this timeframe. Despite demonstrated financial and process efficiencies, the automatic reading and saving of citizens license plate information is a legitimate concern. Although there has been limited research in the area of data storage of citizen information collected through LPR technology, we found that the American Civil Liberties Union recommends some practices that law enforcement, government agencies, and private companies using LPR technologies should consider during implementation as a consideration to the safeguarding of citizen data: Organizations should investigate only hits and reasonably should believe that the plate data is relevant to an ongoing investigation. Reasonable suspicion of an infraction occurring before examining collected license plate data. Retention of data about innocent people should be measured in days or weeks, not months. Access controls must be placed on LPR databases, and access granted to only those trained on the technology and departmental policies. Citizens should have access to the data maintained about them, and disclosure to third parties only if there is consent. Law enforcement agencies should not share license plate reader data with third parties that do not conform to retention and access principles. Hot lists should be updated as often as practicable and, at a minimum, at the beginning of each shift. Any entity that uses LPRs should be required to report usage publicly on at least an annual basis. 40 ROWE as the primary City agency that currently uses LPRs in the performance of its duties has created a policy for its LPR AutoVu Data. 41 Many of ROWE s practices are in alignment with or more stringent than the recommendations noted above, and include the following: Categorization of data as enforcement data or non-enforcement data 39 Denver, Denver Photo Enforcement Program, December 2011, 40 The American Civil Liberties Union, You Are Being Tracked: How License Plate Readers Are Being Used To Record Americans Movements, July 2013, 41 ROWE s AutoVu (LPR data collection system) Data Policy was last updated in November P a g e 35

44 Enforcement data includes all information gathered for the violation and shall be retained for the life cycle of the parking citation with no restriction on its reasonable utilization. Non-enforcement data includes all data not associated with a specific parking violation, which will be permanently discarded upon the conclusion of the shift when the data was generated, not to exceed twenty-four hours with an exception given for general internal analysis requested by the City Engineer. Presented study data must be general in nature and not individual specific. LPR usage will be made public annually. Any expansion to the LPR program in the City, regardless of the agency, should incorporate policies and procedures that balance the privacy concerns of citizens against the most efficient way to enforce local and state vehicle registration laws. The policies enumerated above can provide guidance in the development of such documents, processes, or ordinances. Improvements to the Licensing and Registration Tab Process Require State Legislative Changes and Leadership As a statutory agent of the State, DMV improvements to systems and processes surrounding vehicle title and registration require State buy-in and potential legislative changes that could take years to achieve. The State of Colorado has pushed the title and registration processes down to the county level while retaining drivers licensing at the State level. Across the country, DMV functions are administered by any number of state or county agencies. In the City and County of Denver, DMV functions are administered under the Department of Finance s Treasury Division. Several Entities with Varied Interests Must Be Consulted When Considering Changes to or Elimination of Registration Tabs In Denver, the Department of Finance s Treasury Division acts as the City s DMV representative. Denver s elected Clerk and Recorder is well positioned to gather increased representation and advocacy for the City as a member of the Colorado County Clerks Association due to the size of the Association s membership and ability to advocate directly with elected representatives at the State. However, specific to Colorado, there are no statutes requiring DMV functions be performed by the Clerk and Recorder, and the organizational structure of DMV within the City should not hinder opportunities for increasing the collaborative relationship between DMV and the Clerk and Recorder s Office to move DMV initiatives forward at the State that could potentially benefit Denver citizens. As part of our research of statewide title and registration, we attempted to survey all of Colorado s sixty-four County Clerk and Recorders to obtain information regarding their title and registration processes. For enforcement processes, we requested the survey be forwarded to enforcement agencies in their respective jurisdictions. Of the sixty-four counties surveyed, thirteen, mainly smaller counties of Colorado, responded. City and County of Denver P a g e 36

45 Additionally, one enforcement agency responded. Respondents indicated that several other entities must be involved before changes to the title and registration process could be considered in the State. Their recommendations included, but were not limited to, involving the Colorado County Clerks Association, State Troopers, and other law enforcement representatives. Any consensus on legislative updates reached by these entities would then have to be proposed to the State for review. City Representatives Can Initiate a Collaborative Approach to Assessing the Title and Registration Tab Processes on Behalf of Denver A collaborative approach among several entities around the State is vital to ensure the success of any proposed legislative changes to the current registration tab and registration card requirements. As the analyses outlined in this report demonstrate, the City can improve efficiencies in enforcement, and citizens in and across the State may benefit from reduced wait times at DMV branches, among other cost savings, if the registration tab requirement were eliminated. Finally, because the City and County of Denver geographically represents the second-largest population of citizens in the State, we believe that the City is well-positioned to initiate a proactive assessment of the title and registration process that takes into consideration the needs, financial limitations, and administrative practices of surrounding jurisdictions in enforcing compliance with State law. P a g e 37

46 APPENDIX A Denver Motor Vehicle Division 2012 Peak Performance Strategic Plan City and County of Denver P a g e 38

47 P a g e 39

48 City and County of Denver P a g e 40

49 P a g e 41