What Does Driving Have to Do With Debt Collection?

For some people, a traffic ticket is just a nuisance: Pay the ticket and move on. But for many Americans, the inability to pay a ticket or fine, often for a minor infraction, can kick off a harmful chain of events. Starting with having their driver’s license suspended, drivers are then faced with a tough choice to stop driving—and lose access to work and necessities—or keep driving with a suspended license and risk more costly fees, arrest, and even jail time. 

That’s precisely the choice facing millions of people in the U.S. who’ve had their driving privileges suspended. 

Without driving, many people can’t get to work, take their children to school, or get an elderly parent to the doctor. So in most places, 75% of people continue driving after their license is suspended. If they get pulled over, they can be arrested and jailed. And even a few days in jail can lead to job loss and housing instability. Rather than solving the problem of unpaid tickets and fines, these enforcement practices make it even more difficult for people to earn the money they need to pay the penalties and fees to get their licenses back.

That’s why lawmakers across the country are taking bipartisan action to stop the counterproductive practice of suspending driver’s licenses because of unpaid debts. In the past five years, 21 states—from Mississippi and West Virginia to New York and California—have passed major reforms to curb debt-based driver’s license suspensions.

Policymakers in Michigan recently found that driving on a suspended license was the third most common reason people in their state went to jail. In response, lawmakers in 2020—with near-unanimous bipartisan support—passed legislation to end driver’s license suspensions for unpaid fines and fees. Governor Gretchen Whitmer signed the bill, which took effect last October. The new law will reduce jail admissions and halt a practice that led to more than 350,000 license suspensions in Michigan each year.

Ensuring that drivers have valid licenses and insurance is critical to everyone’s safety on the road. But needlessly taking away licenses from economically vulnerable people not only prevents them from paying their court debts but also undercuts their ability to support themselves and their families. Countless American families are already under financial pressure: Household debt in the United States has tripled from $4.6 trillion in 1999 to $12.29 trillion in 2016, and debt collection lawsuits dominate civil court dockets—with court fines and fees only adding to the financial burden.

And punishing people for not having enough money to pay fees is not only a hardship for them; it also poses equal protection problems because of the disparate impact on poor people and creates counterproductive budget policy. Suspending driver’s licenses is one of the least efficient ways for the criminal justice system to recoup its costs. By contrast, people are more likely to pay fines and fees when they’re given the option of affordable payment plans to handle their traffic tickets. State budget managers in California, for example, saw collections increase significantly after 2017 when the Golden State replaced license suspensions with income-based payment plans.

State lawmakers are moving in the right direction, but more states could act to change their policies. And at the federal level, the pending bipartisan Driving for Opportunity Act could incentivize action by providing states with federal grant dollars to reinstate licenses already suspended because of unpaid fines and fees. As the country emerges from a pandemic that has punched holes in both state budgets and the personal finances of Americans, the time for more thoughtful and effective corrections and debt collection policies is now.

Jake Horowitz directs The Pew Charitable Trusts’ public safety performance project. Joanna Weiss is co-director of the Fines and Fees Justice Center.

This essay, which has been updated, first appeared in The Hill.