Baja’s Mount Rushmore

Sightseeing in Cabo San Lucas, Mexico, offers relaxing views of turquoise waters, white sandy beaches – and plenty of South Dakota license plates. But these car owners who drive the roads in and around the Mexican vacation Mecca aren’t from East River or West River. In fact, most of them have never been to South Dakota.

They are U.S. citizens living abroad who are not South Dakotans but who want to cheaply and easily register the cars they drive while away from home.

And with no emissions tests, vehicle inspection or proof of insurance, South Dakota’s loose and relatively cheap vehicle registration regulations have developed a reputation as the place for these people get what they want. Word is spread on websites and in newspaper advertisements.

While it might sound questionable for residents of other states living abroad to register their vehicles in South Dakota, it is legal, and the state and some of its counties make money off the practice.

One entrepreneur from Las Vegas even has made a business out of it.

Only U.S. citizens qualify. They must provide proof of their Social Security number and an American or a Mexican driver’s license, plus a passport.

It’s a running joke on the Baja Peninsula, where some locals refer to Mexico as “South South Dakota.” There are hundreds of cars driving around with the familiar Mount Rushmore plates in Cabo, and thousands on the peninsula, by some estimates.

The only downside for South Dakota is a matter of reputation and competition. Other states don’t appreciate The Rushmore State horning in on tax and fee money that is rightfully theirs. And at least one South Dakota officials worries about “false” revenue that could go away should other states crack down on their residents who register vehicles in the state.

For now, it’s part of the culture. There’s even been talk of throwing a South Dakota license plate-themed party in Cabo.

Mexico’s king of S.D. plates: Bob Jankovics

If that happens, a fitting guest of honor would be Bob Jankovics. He’s the go-to businessman for help in obtaining South Dakota plates. He’s been at it four years. For a $200 fee, he guides customers through the process.

“I just ended up saving people thousands of dollars,” Jankovics said this week in a telephone interview from Cabo. “They bless the ground I walk on. I’m very well known throughout Baja.”

Jankovics, who has homes in New York, Las Vegas and Mexico, himself drives around Mexico with personalized South Dakota license plates that bear the message of, what else? PLATES.

It’s been no secret that South Dakota is a haven for out-of-staters to license their vehicles. It’s a matter of low taxes and fees, and lenient policies. The state is especially popular with people who live full time in recreational vehicles.

In California, for example, residents must pay based on the value of the vehicle and an additional fee for pickups. A Ford F-250 runs about $400. California also requires a vehicle inspection and emissions testing every two years. People have to actually bring their vehicles in for registration.

By contrast, South Dakota registration fees average about $60. There’s no emissions test, vehicle inspection or proof of insurance. Unlike California, a car owner doesn’t need to physically visit South Dakota to register their car here.

As a result, Californians regularly call Pennington County to ask about registration, Treasurer Janet Sayler said this week from Rapid City.

She estimates that half the calls to her office are from a person who lives out of state. That’s an average of 50 calls a day, but Sayler doesn’t mind, because it means more money to the county.

“Quite frankly, we are not going to not license them, because it’s revenue for us and they never drive on our roads,” she said.

But the registrations her office hands out to people who don’t live in South Dakota come with a warning: “We tell them, ‘If you get caught we aren’t giving your money back.’ They know where they live,” Sayler said.

Deputy treasurer Diane Johnson helps Jonah Wonnenberg get new tabs for a trailer and sport utility vehicle Friday at the Clay County Courthouse in Vermillion. South Dakota gets a number of registrations from faraway places, including Mexico. / Emily Spartz / Argus Leader

Registration policy varies by county

County approaches are many. Take Minnehaha.

“Just because if we have to find you and we have a problem, we are not going to Mexico to find you,” Treasurer Pam Nelson said.

For Jankovics, the businessman, his connections are in Clay County.

He said he talks daily to the women in the Treasurer’s Office, who he knows on a first-name basis.

“The girls do a tremendous job,” he said.

Clay County, Treasurer Cathi Powell said she thinks it is her duty to process the plates. The office has been doing just that for out-of-staters since at least 1979, the year she began working there.

“I don’t feel like we could refuse them. I feel that is part of our office’s job,” she said.

Powell doesn’t keep track of how many registrations her office processes for out-of-staters, but she estimates it’s about 5 percent of the county’s registration business.

Some states don’t like South Dakota’s lax vehicle registration policy.


California tough on going out-of-state

“It is a little frustrating, but that’s why the CHEATERS program was put into place,” said Jan Mendoza, a spokeswoman for the California Department of Motor Vehicles.

In 2007, California created the program that allows people to turn in their neighbors for registering in other states by calling a hot line or logging on to a website.

In most states, it is illegal for residents to register their vehicles in another state. In California, violators face hundreds of dollars in fines and penalties.

In South Dakota, Deb Hillmer, the director of the state division of motor vehicles, worries that the fees and taxes the state collects from out-of-state residents could go away. In some instances, it has.

Nebraska cut into S.D. business

South Dakota lost about $1 million when Nebraska decided a few years ago to go after its residents who were using South Dakota registrations to save money. Nebraska, meanwhile, gained about $5 million, Hillmer said.

“If the state that these people are actually from goes after them, we are going to lose them,” Hillmer, said.

Minnesota officials also have requested South Dakota’s registration data to find and go after their residents, and South Dakota complies with such requests, Hillmer said.

Two years ago, South Dakota officials attempted to crack down on abuses of the system. Hillmer sent a memo to county treasurers asking them to demand more information from out-of-state residents before issuing licenses. The goal, she said, was to discourage falsified applications and collect information on where people really lived.

That information could be used by other states to crack down on their residents who license vehicles, boats and motor homes here.

That could cost South Dakota millions of dollars by discouraging out-of-state registrations. The state’s licensing fees help pay for road repairs.

For now, Pennington County’s Sayler said it would be fiscally irresponsible not to take money from out-of-staters.

“I’m not going to refuse to take their money unless state law says stop,” she said.

Such a change in South Dakota policies would need approval from state legislators. But no lawmaker, for now, is pushing it.

“I don’t’ have an opinion either way, because it does bring revenue to the state and it certainly doesn’t hurt South Dakota in any way,” Rep. Gene Abdallah, R-Sioux Falls, said.

Rep. Tom Jones, D-Viborg, who represents Clay County, likes that South Dakota’s policy brings in money

“I guess that’s part of being an American – the freedom to be able to shop around for their license plates.”


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