BMV: $2 million more in overcharges, new boss

Gov. Mike Pence announced a major leadership shakeup at the Indiana Bureau of Motor Vehicles on the same day that the troubled agency revealed yet another $2 million in mistaken taxes and fees.

BMV Commissioner Don Snemis will be replaced by Kent Abernathy, now chief of staff at the Indiana Department of Environmental Management. Snemis will take a new position as special counsel for program integrity at the state's Family and Social Services Administration.

The leadership change came as the BMV acknowledged overcharging nearly 30,000 customers a total of about $2 million over six years. The mistaken charges involved delinquent fees for mobile and manufactured home titles, reinstatement fees paid by people who later proved they had insurance and other miscellaneous taxes and fees.

The BMV plans to issue refunds or credits to affected customers.

The blunder is the latest of several to rock the BMV since 2013.

The state agreed to refund $30 million in overcharges for driver's licenses as part of a class action lawsuit and has acknowledged a $29 million mistake in calculating motor vehicle excise taxes. A second class action lawsuit regarding alleged overcharges for registrations is pending.

The attorney who filed the lawsuits alleging the BMV overcharges called the governor's action too little, too late.

"Obviously, the BMV would not even be doing this if it wasn't for the lawsuits," said Irwin Levin of the Indianapolis law firm Cohen & Malad.

"What the citizens of Indiana should be concerned about is that they are not wanting to do this through the court, where there would be judicial oversight. They don't want anyone looking over their shoulder."

The pending lawsuit seeks the return of an additional $38 million that, Levin contends, the state has not acknowledged or made any effort to return.

Speaking at a news conference Monday, Pence praised the BMV for its customer service and said Snemis, an attorney appointed to head the agency in January 2014, has done a good job tackling the problems with overcharges.

But he said Abernathy, a West Point graduate with banking industry experience, is the right man to carry on improvements.

"I want the back office at the BMV to run as well as the front office," Pence said.

He warned that an ongoing BMV review by accounting firm BKD could trigger additionalrefunds in the future.

"I want to emphasize, there will likely be more to come," he said.

Beyond the leadership change, Pence announced a number of other steps his administration is taking in an effort to fix the BMV's financial mistakes.

The changes include creating an internal BMV audit group composed of BMV employees, auditors from the State Board of Accounts and representatives from the state technology department.

Pence said his office also is working with House Roads and Transportation Chairman Ed Soliday on legislation that would streamline BMV fees and establish a six-year statute of limitations for legal action related to the overcharges.

He said the BMV's employee handbook also has been changed to require employees to report any overcharges.

Pence said the ongoing review of the BMV's fees has turned up about $13 million in annual undercharges in addition to the overcharges. He said the state will not seek to recoup those undercharges.

Levin, the attorney behind the lawsuits that first made the overcharges public, said the revelation of even more fee problems "shows (the BMV) didn't know what it was doing."

Call Star reporter Tony Cook at (317) 444-6081. Follow him on Twitter: @indystartony.