THE FINANCE AND ADMINISTRATIVE SERVICES DEPARTMENT AND THE RECORDS, TAXES AND TREASURY DIVISION RECOMMEND APPROVAL OF THE ABOVE MOTIONS.
There are seven Private Auto Tag Agencies (PTAs) contracted by Broward County to provide tag and title services. The PTAs are permitted by contract to assess additional service fees to customers, in addition to the standard County-retained vehicle and vessel transaction fees. The PTAs and their Board approval dates are as follows (in chronological order):
- First Broward of Ft. Lauderdale - approved May 13, 1997 (Item No. 4)
- First Broward of Lauderhill - approved October 20, 1998 (Item No. 85)
- Pembroke Pines Auto Tag Agency - approved October 20, 1998 (Item No. 86)
- Deerfield Beach Auto Tag Agency - approved April 13, 1999 (Item No. 33)
- Broward Tag Agency DBA Broward Express Auto Tag Agency - approved April 13, 1999 (Item No. 32)
- South Broward Tag Agency LLC - Hollywood office - approved January 6, 2009 (Item No. 4)
- South Broward Tag Agency, LLC - Weston office - approved January 6, 2009 (Item No. 4)
Service fee rates have not been adjusted in over 20 years for five of the PTAs and in over eight years for the other two PTAs. On January 23, 2017, Mr. Jason Strochak, owner of four of the seven PTAs, requested a review and possible adjustment to the service fees (Exhibit 1).
Section 20-251(a) of the Broward County Code of Ordinances provides that PTAs can charge a fee for its services, which are determined by contract with the PTA and listed in a schedule attached to each PTA contract approved by the Board. Section 20-251(a) further provides that the Records, Taxes and Treasury Division (RTT), as the Revenue Collector for the County, may periodically review and determine whether adjustments to the schedule of fees are warranted.
In response to the request, RTT reviewed the schedule of fees with the following considerations:
- The County has the option to periodically review PTA service fee rates and to make adjustments to compensate for inflation and other changes in operating conditions.
- The County has not conducted such a review since the initial service fee schedule was adopted in 1997 for the first five and 2009 for the additional two PTAs.
- The CPI inflation rate for all goods and services purchased for consumption by urban households (CPI-U) has increased by 52% since May, 1997 (approval date of the first five PTAs) and increased by 13% since January, 2009 (approval date of the additional two PTAs).
- There are two other Florida counties with public-facing PTAs (Miami-Dade and Volusia) whose fees were also reviewed for comparison purposes.
- There are substantial costs involved in the establishment and retention of a PTA, and those costs have increased as demonstrated by the increase in the CPI.
- The PTAs continue to promote and retain business and revenue sources from outside the geographical boundaries of the County.
- The PTAs continue to supplement the County’s Auto Tag operations, with little or no additional operating or capital budget impact to the County. For the County to establish seven additional Auto Tag Agencies, it is estimated that it would cost an additional $8.4 million per year.
Based on the review and the above considerations, RTT recommends the standardization of the service fee rates across all PTAs, and an adjustment to the fees in accordance with the CPI-U inflation factor from each rate inception date to the current period. RTT has confirmed with the Office of Management and Budget that this is an acceptable method when considering a modification to the existing rates. The revised service fees would become effective following execution of the necessary contract amendments.
The CPI-U for the initial five and two added PTAs would be applied to their respective fees and then averaged for a final “blended” rate across all PTAs. Odd rate amounts would be rounded to the next quarter dollar for practical presentation and collection purposes. The proposed schedule of service fees for each of the PTAs is attached for review and consideration (Exhibit 2).
If Motion A is approved, Motion B authorizes the County Administrator to execute amendments to the existing agreements with the PTAs, which will implement the proposed schedule of fees.
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