BMV vendor: Pence’s decision to cancel contract is discriminatory

A vendor for the Indiana Bureau of Motor Vehicles is objecting to Gov. Mike Pence’s decision to end the state’s contract with the company amid ethics concerns over a BMV official who went to work for the firm.

“This discriminatory treatment is unjustified and wrong,” Express MVA said of Pence's decision in an unsigned two-page statement released to the media late Friday.

The company’s statement comes after Pence announced Wednesday that he would not renew the BMV’s contract with Express MVA, a private license branch operator that specializes in processing titles and registrations on behalf of auto dealers

The governor also requested a formal ethics investigation into a top BMV official, former Chief of Staff Shawn Walters, who took a newly created executive job at the company after allowing it to charge customers a “convenience fee” whose legality has been questioned.

Express MVA’s statement represents the company’s first public comment since an Indianapolis Star story last month that raised questions about whether the convenience fees were authorized and whether Walters violated a state ethics law that puts limits on public employees going to work for a company that does business with the state.

In its statement, Express MVA accused Pence of effectively eliminating 40 jobs and closing a business that generates $12 million annually — even as competitors with similar BMV contracts are allowed to continue operating.

The company said its efforts to meet or speak with the Pence administration have been unsuccessful.

Pence spokeswoman Kara Brooks issued a short statement in response to Express MVA’s complaints.

“Governor Pence is committed to ensuring ethical transparency at the BMV and that’s why he asked for the investigation,” she said.

She said the BMV is working to schedule a meeting with the company.

In its statement, Express MVA defended its hiring of Walters, saying it followed recommendations from the BMV to avoid conflicts of interest.

Those recommendations are documented in an August 2014 letter to Walters from BMV attorney Patrick Price, written after Walters began working for Express MVA as its chief operations officer.

Price warned Walters that state ethics law prohibited him from handling any BMV-related matters on behalf of his new employer, given that he “took a personal and substantial role in negotiating Express MVA’s contract with the BMV” as the agency’s chief of staff.

Specifically, Walters signed an amendment to the contract allowing the company to open a second partial service branch in Evansville and worked with Express MVA on the scope and terms of the contract, Price wrote.

“For these reasons, the (BMV) Commissioner has instructed relevant BMV personnel not to discuss matters related to contracts between the BMV and Express MVA with you,” Price wrote. “We ask Express MVA to designate someone else as our point of contact, and to screen you from all such discussions.”

Walters testified in an unrelated lawsuit that he has no oversight over the company’s Indiana operations.

Express MVA said in its statement that it is prepared to fully assist the state in its ethics investigation.

The company’s statement does not address the legality of the so-called “convenience fees” that it and other vendors charge for title and registration work traditionally available only through the BMV.

Those fees can double or triple the cost of the same service at the BMV and are often passed through to car buyers, who may not be aware they could get the same service at a lower cost at a state license branch.

The BMV has allowed Express MVA and others to charge the convenience fee for years, but state lawmakers didn’t explicitly allow the practice by law until earlier this year.

The BMV says the new law was simply a clarification, but critics — including Rep. Dan Forestal, the top Democrat on the House Roads and Transportation Committee — say the convenience fee is simply the latest example of the BMV gouging Hoosier motorists with illegal fees.

The agency has already admitted to overcharging Hoosiers about $60 million in other taxes and fees. It has also written off millions of dollars in undercharges.

A Star investigation published in March found that top BMV officials — including Walters — knew about some of those fee problems for years, but chose to ignore or cover up the overcharges rather than refund the extra money and adjust to significant budget losses.

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