State of Iowa Expands Government Payment Partnership with Dwolla; Iowa DOT Begins Using Service for IFTA and IRP

Press Release

Gov. Terry Branstad today announced the continuation of Iowa's state government payments partnership with Dwolla, the Internet's first payment network. Today's announcement allows carrier customers of the Iowa Department of Transportation to use Dwolla when filing and paying International Fuel Tax Agreement (IFTA) returns and International Registration Plan (IRP) fees. As the only online payment option for the nearly 55,000 annual transactions, the new partnership provides the state and its tax payers a streamlined online process and turnaround time, an alternative to costly card payments and mailed checks, and a reduction in clerical errors and administrative costs

The State of Iowa announced its first partnership with Dwolla in early 2013. It allowed retailers to pay more than $100 million in cigarette stamp taxes through the Iowa Department of Revenue. In July 2013, nearly a dozen Iowa counties began accepting the low-cost payment network for their individual vehicle registration and property taxes.

"Reducing the size and cost of government must also mean a more innovative, business and taxpayer friendly government," said Branstad. "The State of Iowa has seen success in our partnership with Dwolla and the Department of Revenue. Expanding our partnership to the Department of Transportation will help our citizens and modernize the way government does business."

"Dwolla's simple payment network brings an effective, innovative means of payment for Iowa taxpayers, while providing increased government efficiency," said Lt. Governor Kim Reynolds. "We're excited about the state's expanded use of Dwolla and are continuing to explore new ways to use the payment network."

Iowa DOT Director Paul Trombino III, said, "Nearly 7,000 motor carriers in Iowa have been able to complete IFTA and IRP paperwork online for several years, but they have not been able to complete the payment portion of the transaction online until now. That was causing many of them to continue to file paper returns, which have a greater opportunity for errors. We think using Dwolla will reduce the number of errors and streamline the filing process for these transactions."

The ability to complete the entire transaction online has many benefits to both Iowa's motor carrier customers and the Iowa DOT. Mark Lowe, director of the Iowa DOT's Motor Vehicle Division, said, "Because motor carriers had to print the document and send us a check anyway, many of them did not take advantage of the online system. By making it easier and more cost effective to pay fees and taxes, we are reducing the cost of the transaction, both for the customer and the state, and effectively increase the revenue collected."

The online service completes several complicated calculations automatically, drastically reducing errors that can hold up the documents from being accepted. Receiving the documents online will help the DOT process the returns much more quickly and efficiently. Lowe added, "Dwolla' brings the whole thing together by offering carriers an online payment option that is inexpensive and avoids credit card processing fees, which can be significant for large transactions. I think this is the first of many opportunities that the Iowa DOT will explore using Dwolla."

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