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56MOTOR VEmCLE DEPUTY REGISTRARSsimilar for public and private deputies. While our study did not address all aspectsof customer service, it suggests that other factors, such as size of deputy, are moreimportant than whether the deputy is private or public. For example, we foundwaiting times tended to be considerably longer at large deputies than at smalldeputies.The existence of private deputies, by itself: does not automatically bring the benefitscommonly associated with private enterprise. Private deputies do not bringlower prices to consumers because, under the current system, there is no pricecompetition. The state sets all administrative fees and prohibits deputy registrarsfrom charging a lower fee. Private deputies may be more efficient than publicdeputies, but that does not necessarily help the public under the protective regulationsof the state. Under the current system, replacing a public deputy with a privatedeputy helps Minnesota citizens economically only if the public deputy islosing money.We did not findevidence thatan all-privateor an all-publicsystem wouldbe better thanthe currentsystem.IState regulations also limit competition by strictly controlling the fonnation ofnew deputy registrars, separating them geographically, and restricting advertisements.If a deputy provides mediocre service, it still may keep most of its customersbecause, unlike most of the private sector, nobody can move into its area andcompete head-to-head.In conclusion, we did not find empirical evidence that either an all-public or an allprivatesystem would be better than the current system. To improve the system,we think the focus should be on how to make the system more responsive to thecustomer, either in the fonn of lower costs or better service.There are many options for reducing costs or improving customer service. We discussthese in the following sections on fee policy and state regulation.FEE POLICYIn Chapter 3, we found that large and medium-large deputies tend to do well financially,although some large public deputies just break even or lose money. Mostsmall public deputies lost money and small private deputies earned relatively lowincomes. In Chapter 1, we showed that most states have lower administrative feesthan Minnesota. However, an across the board reduction in Minnesota's feeswould impose an additional hardship on small deputies, which may jeopardize accessin small communities.Other states use a variety of approaches to deal with this problem. A few statesvary the fee according to the number of transactions an agent processes. Ohiouses a bidding system to award two-year contracts. Presumably, agents in largemetropolitan areas would make lower bids than in small towns. Some states allowagents to set their own fee within a specified range. Finally, a few states let countiesdetennine fees for agents in their county.