South Dakota Uses License Suspension Requests to Collect State Debt

South Dakota’s Obligation Recovery Center requests an average of 249 driver’s license suspensions each month to collect debts owed to state government. The figure was presented during a Sept. 8 Government Operations and Audit Committee meeting in Pierre, South Dakota, Searchlight reported.

The number has remained relatively consistent in recent years, but a request does not necessarily result in a suspension. Many people establish payment plans before losing their driving privileges, according to Jason Kettwig, deputy director of the Bureau of Human Resources and Administration, which oversees the center.

Suspension Requests Aim to Prompt Contact

Kettwig told lawmakers that the possibility of losing a license can encourage people to respond after multiple collection attempts have failed. He described communication with debtors, rather than the suspension itself, as the step that allows officials to explain repayment options.

“We don’t collect money because we get their license taken away,” Kettwig said. “We collect money because we are able to talk to them and explain to them what they can do to make it right. But sometimes the only way we can talk to them is to have something that they feel.”

Reliant Capital Solutions, the private company operating the center, can ask the state to suspend the driver’s licenses of debtors who owe more than $1,000 through the program. Reliant has held the operating contract since 2020.

How the State’s Collection Program Works

South Dakota lawmakers established the Obligation Recovery Center in 2015, and it began operating in July 2016. The program centralizes the identification, oversight and collection of debts referred by state agencies and institutions.

Those obligations include fines and court costs, unpaid tuition or fees at state institutions, and amounts owed to agencies such as the departments of Transportation, Revenue, and Game, Fish and Parks.

A 20% cost recovery fee is added to the principal amount of debt referred to the center. Those funds are used to compensate the collection vendor, according to the state’s fiscal 2026 budget materials.

For example, a $2,000 principal balance would generate a $400 cost recovery fee. That charge would be added to the debt, rather than deducted from the principal balance owed to the referring agency.

The center reports its performance annually to lawmakers, providing figures on collections and outstanding accounts. This year’s presentation covered both the program’s cumulative recoveries and its more recent reliance on installment payments.

Court Debt Accounts for the Largest Share of Recoveries

The annual performance figures reported by South Dakota Searchlight show that the center has collected approximately $34.7 million since operations began a decade ago.

Court-related obligations represent the largest share of that total, accounting for about $15.7 million, or roughly 45% of collections. That amount is more than four times the approximately $3.6 million recovered for the Department of Revenue.

During the most recent reporting year, the center recovered approximately $4 million. About $1.8 million of that amount came from court debt.

Despite those recoveries, people with court-related obligations still owe more than $102 million, according to the report. The court system therefore remains a major part of both the center’s collection results and its outstanding debt portfolio.

Installment Payments Account for Most Resolved Accounts

Kettwig said the center has relied more heavily on payment plans over the past three years. Of the 15,062 accounts resolved during the most recent reporting year, approximately 60% involved people who paid their obligations in installments.

The center still had approximately 176,000 outstanding accounts as of June 30, the end of South Dakota’s 2026 fiscal year.

The results distinguish efforts to establish contact from the process of completing repayment. While Kettwig described suspension requests as a way to prompt communication, installment payments accounted for most resolved accounts. The annual review therefore highlights repayment outcomes alongside enforcement activity, with a substantial volume of accounts still awaiting resolution.