MNHunter
Well-known member
Though a bit dated, I though this article was rather interesting. It is concerning the price increase of the application fee.
Hunting Fee Increase Flows into Bank Coffers
By George Morse and Sarah Welsh
SUN Staff
Published:
Thursday, May 28, 2009 10:17 AM MDT
Hunters who wanted fairness in New Mexico’s game-license application process ended up with a new system in which everyone is paying more, and the main beneficiary is neither the state nor hunters but a single financial entity — Bank of America.
According to state documents, the state Game and Fish Department projects that it will pay Bank of America more than $740,000 in credit-card processing fees for the 2009-10 license lottery. To cover that expense, the Department has raised the application fee for all licenses to $9 for residents and $12 for nonresidents.
Last year, the application fee was $8 for everyone.
The banking fees skyrocketed because starting this year, the state required hunters submitting online applications for antelope, bighorn sheep, ibex and javelina to charge the full license fee — which tops out at $3,160 for a nonresident bighorn license — to their credit cards. In previous years, online applicants were only being charged the application fee.
The volume of transactions is enormous, and the bigger each transaction is, the more the bank benefits. Hunters submitted 166,490 applications for the 2008-09 lottery cycle, and Department Assistant Director Pat Block said online credit-card applications make up about 80 percent of that total.
The Department contracts the running of the online system to Bank of America, which charges a flat rate of 1.3 percent per transaction, Block said.
“You can imagine the cost,” Block said. “That’s why we had to raise the application fee.”
The new system benefits Bank of America in another way. Before, the tens of thousands of hunters who applied online but did not draw a license were only charged the $8 application fee. Now those hunters are charged the full license fee up front, and if they do not draw a license they receive a refund.
The refund constitutes a second credit-card transaction and is also subject to the 1.3 percent fee, Block said.
Block said requiring the full license fee to be submitted with online applications is the result of complaints from hunters who applied by mail. In previous years, those applying by mail were required to send the entire license cost along with their mailed-in application, while those applying online were only charged the application fee.
$2 Million Budget
By law, the Department cannot make money on the game lottery itself, only on the subsequent sale of licenses.
“It’s required that what we charge and receive for the application fee doesn’t exceed our cost of running the drawing,” Block said.
But with so many applicants, hunters often argue that the Department is taking in over $1 million in application fees and that it shouldn’t cost that much to hold the drawing.
According to a Department budget breakdown, the state will actually spend more than $2.03 million to administer the 2009-10 lottery. Based on a figure of roughly 160,000 applicants, it estimates the cost per applicant to be $12.71.
Department documents list the following budget line items:
• Merchant service fees, $743,655 (see above)
• Staff salaries and benefits, $640,167.38
• Printing rule books, $295,000
• Contracts for temporary services, data entry and mailing, $96,840
• Printing application forms, $75,000
• Postage, $62,500
• Enhanced bandwidth, $60,000
• Per diem and mileage, $10,000
• PayPal fees, $10,000
• Computer hardware, software and maintenance, $27,500
The results of this year’s drawing will be available June 11 on the Department’s website or in person at any Department office.
http://www.riograndesun.com/articles/2009/05/28/news/doc4a1d688ad2472948907727.txt
Hunting Fee Increase Flows into Bank Coffers
By George Morse and Sarah Welsh
SUN Staff
Published:
Thursday, May 28, 2009 10:17 AM MDT
Hunters who wanted fairness in New Mexico’s game-license application process ended up with a new system in which everyone is paying more, and the main beneficiary is neither the state nor hunters but a single financial entity — Bank of America.
According to state documents, the state Game and Fish Department projects that it will pay Bank of America more than $740,000 in credit-card processing fees for the 2009-10 license lottery. To cover that expense, the Department has raised the application fee for all licenses to $9 for residents and $12 for nonresidents.
Last year, the application fee was $8 for everyone.
The banking fees skyrocketed because starting this year, the state required hunters submitting online applications for antelope, bighorn sheep, ibex and javelina to charge the full license fee — which tops out at $3,160 for a nonresident bighorn license — to their credit cards. In previous years, online applicants were only being charged the application fee.
The volume of transactions is enormous, and the bigger each transaction is, the more the bank benefits. Hunters submitted 166,490 applications for the 2008-09 lottery cycle, and Department Assistant Director Pat Block said online credit-card applications make up about 80 percent of that total.
The Department contracts the running of the online system to Bank of America, which charges a flat rate of 1.3 percent per transaction, Block said.
“You can imagine the cost,” Block said. “That’s why we had to raise the application fee.”
The new system benefits Bank of America in another way. Before, the tens of thousands of hunters who applied online but did not draw a license were only charged the $8 application fee. Now those hunters are charged the full license fee up front, and if they do not draw a license they receive a refund.
The refund constitutes a second credit-card transaction and is also subject to the 1.3 percent fee, Block said.
Block said requiring the full license fee to be submitted with online applications is the result of complaints from hunters who applied by mail. In previous years, those applying by mail were required to send the entire license cost along with their mailed-in application, while those applying online were only charged the application fee.
$2 Million Budget
By law, the Department cannot make money on the game lottery itself, only on the subsequent sale of licenses.
“It’s required that what we charge and receive for the application fee doesn’t exceed our cost of running the drawing,” Block said.
But with so many applicants, hunters often argue that the Department is taking in over $1 million in application fees and that it shouldn’t cost that much to hold the drawing.
According to a Department budget breakdown, the state will actually spend more than $2.03 million to administer the 2009-10 lottery. Based on a figure of roughly 160,000 applicants, it estimates the cost per applicant to be $12.71.
Department documents list the following budget line items:
• Merchant service fees, $743,655 (see above)
• Staff salaries and benefits, $640,167.38
• Printing rule books, $295,000
• Contracts for temporary services, data entry and mailing, $96,840
• Printing application forms, $75,000
• Postage, $62,500
• Enhanced bandwidth, $60,000
• Per diem and mileage, $10,000
• PayPal fees, $10,000
• Computer hardware, software and maintenance, $27,500
The results of this year’s drawing will be available June 11 on the Department’s website or in person at any Department office.
http://www.riograndesun.com/articles/2009/05/28/news/doc4a1d688ad2472948907727.txt
