About the Program

The Department of Motor Vehicles (Department) administers the Motor Vehicle Financial Security Act and the Motor Vehicle Safety Responsibility Act (collectively, “Acts”) pursuant to Articles VI and VII of the Vehicle and Traffic Law. These Acts help ensure that the operators of motor vehicles registered in New York possess adequate insurance coverage, or are financially secure, to compensate persons they might injure or whose property they might damage as a result of an accident. Department activities relating to the Acts fall into three program areas: the Dedicated Bridge and Highway Safety Program, the Compulsory Insurance Services Program, and the Accident Prevention Course Program. Under the Acts, the Department is required to annually estimate the expenses of administering the related programs and assess these expenses on insurance carriers in proportion to their reported premiums.

The objective of our initial audit, issued December 13, 2019, was to determine whether the Department was appropriately allocating, billing, and collecting the expenses of administering the Acts. We found that, in general, the Department was appropriately allocating, billing, and collecting nearly all expenses related to administering the Acts. However, it could better ensure the accuracy of its allocation and billing practices by analyzing reported premium data and taking follow-up action as needed. In addition, the Department did not bill $126,493 in assessable expenses due to its practice of not adjusting its billing to account for amended premiums reported by insurance carriers. The Department also lacked a method for carrying prior period balances forward to subsequent periods and, as a result, did not collect $25,265 that it had billed to insurers.

Key Finding

The Department has made some progress in addressing the issues identified in the initial audit report and has partially implemented our two recommendations.

Key Recommendation

Officials are given 30 days after the issuance of the follow-up to provide information on any actions that are planned to address the unresolved issues discussed in this report.