For some Louisiana drivers, debt owed to the Office of Motor Vehicles for insurance violations can spiral beyond their means, leaving them thousands of dollars in the red.
“It was too much for them to get back on the road,” OMV Commissioner Dan Casey said.
But through the end of the year, residents have the chance to hit reset on unpaid fines to the OMV.
The agency has begun implementing a 2024 delinquent debt reform law that allows more than 350,000 drivers to start over on violation fees and pay only the original fine for lapsing in car insurance coverage.
The change could potentially reduce fines that had snowballed into $25,000 from a couple thousand for one driver, according to the OMV. Residents who owe money can then pay in full or work out a payment plan with the agency.
“It’s my biggest piece of legislation, probably in my life,” said Casey, who worked with legislators and Gov. Jeff Landry to introduce House Bill 683.
Under the previous system, fees piled up quickly and could become insurmountable for some residents. If a driver fined for a car insurance lapse did not pay after two notifications from the OMV, their debt was referred to the Office of Debt Recovery, which automatically upped the original insurance violation fine — sometimes as low as $125 — to the maximum amount, $525, plus a 25% fee.
The system meant that a resident with multiple violations could find themselves owing thousands of dollars with no way out of the hole.
“It was a horrible situation,” Casey said. “It was the agency following the letter of the law when it was passed in 2015 and 2016. We did what we were told to do by the Legislature.”
To qualify for relief, drivers with unpaid fines must contact the agency by Dec. 31, 2024, and have their debt reset to the amount at the time of the violation. After that date, fees past 180 days will once again be referred to the Office of Debt Recovery.
Unlike the previous model, the debt will stay at the original infraction amount when it is referred, and the Office of Debt Recovery fee will decrease to 15%. The threshold for delinquent debt has also increased, from 60 days to 180 days, meaning violators have more time to pay before their case is transferred out of the OMV.
And, if a resident petitions the agency and shows they can’t afford the unpaid fines, the OMV can still reclaim that case after the deadline, Casey said.
The change could lead to a state revenue shortage of around $43 million, Casey said. But the hope is that getting those drivers back on the road and back to work will boost commerce, he added.
“It wasn’t about the fiscal loss as much as it was the relief to the consumer and to our citizens,” Casey said.
To start the reset process, drivers should go to expresslane.org/dlstatus to check for unpaid fines. After that, they can reach out the OMV via expresslane.org/contactus and select “Installment Agreement or Reinstatement Return Call.” Expect to receive a call back from (225) 925-6146 during normal business hours.
Casey said residents should not be concerned if they don’t receive a call back before Dec. 31, as the agency will log all communications and continue responding in the new year.