Adding a Nonbinary Gender Option to Driver's Licenses Has Become a Huge Expense for States

In November, Massachusetts and Washington became the latest states to add a nonbinary option for driver’s licenses. They join a dozen others that have amended licenses to include a third gender option, most frequently denoted with an ‘X,’ joining the ‘M’ and ‘F’ traditionally found on licenses throughout the U.S.

Many states are poised to follow suit, with states like Hawaii, Illinois, New Hampshire, and Pennsylvania planning to implement changes in the coming years, and a number of others publicly discussing options to do so.

But a majority of states have not indicated any intention to begin offering a third gender option. And it’s not just about politics. One reason that states may be reluctant to make such a bureaucratic change: It’s expensive.

California implemented legislation effective January 1 of this year that added a nonbinary gender option to driver’s licenses and identification cards.

Jaime Garza, a representative from the California Department of Motor Vehicles, told Fortune that the DMV estimates that the entire process of adding a third gender option took approximately 5,000 hours.

But it’s not just man hours—the DMV estimates $880,000 in one-time costs and $45,000 in ongoing technology costs related to the new gender option. In Maryland, the estimated administrative cost for the Department of Transportation’s Motor Vehicle Administration (MVA) to make the change was $220,500, Ashley Millner, a representative from the DOT, told Fortune.

“The cost is related to programming changes and updates to the Driver’s License System, mainframe, and online applications,” Millner said. Modifications to the Driver’s License System included changes to the MDOT MVA’s e-Store and Kiosk, as well as its application info, user interface, system rules, database tables, and stored procedures, according to Millner.

Pennsylvania currently has a manual override option available, but has not yet formally rolled out a third gender option for those applying for driver’s licenses or ID cards. The designation will officially be available as of January 2020. But the state has already incurred costs for initiating the change: $120,788, according to Alexis Campbell, a press secretary from the Department of Transportation.

This figure will cover the system and processes modifications needed to “offer a systematic way gender-neutral designation option to our customers,” Campbell says. These modifications include online processing and display screens, as well as the interface between driver licensing and photo licensing systems, which ensure that the correct gender designation appears on each individual’s license.

New Hampshire will similarly offer a nonbinary gender option at the start of the new year. According to the text of the bill, HB 669, the change will require an estimated $25,000 in FY2020 to make the required updates to the system programming.

But some states have found ways to keep the costs to a minimum. In Nevada, the change only cost staff time, explained Kevin Malone, a public information officer at the state’s DMV. While staff salaries are an expense, Malone said the DMV did not track the number of hours spent in making the change, so they are unable to estimate precise costs.

“We found this to be an outdated practice, particularly in light of the fact that the State began to allow changes on birth certificates through self-attestation in 2016,” Malone told Fortune. “The DMV changed its policies and agreed to implement Gender X at the same time, though it was months later before the computer programming could be accomplished.”

Oregon, which was the first state to officially offer a nonbinary option starting in July 2017 (Arkansas has reportedly quietly offered the option since 2010), also did not report costs for the shift. David House, from the Oregon Department of Transportation explained that “even with our old computer system, the cost to implement was negligible.”

Minnesota, which added a nonbinary option as of Oct. 1, 2018, also avoided incurring additional administrative fees, since the nonbinary gender option was added at the time of the launch of a new driver services system, explains Megan Leonard, a public information officer for the state’s Department of Public Safety. Nevertheless, that new system overall cost $26.25 million.

The process is not always straightforward. The state of Illinois officially signed a bill into law in August that would allow residents to change their gender marker. But it is likely to be years before the change will actually be implemented.

Dave Druker, a representative from the Secretary of State’s office, explained that one’s sex is currently incorporated in their license number. To add a nonbinary option requires a change to the system the state uses, and rather than incurring significant costs to do so, the state has chosen to wait until their existing contract ends. At that time, Druker says, there will be a re-bid where nonbinary will be part of the proposal.

The change more than one-third of states across the country have made reflects a growing shift in public sentiment. Thirty-five percent of Americans in their teens and early 20s know someone who uses gender-neutral pronouns, according to a Pew Research Center study. Nearly 60% of this group say that forms that ask for a person’s gender should not be limited to “man” or “woman.” While these numbers drop for older generations, they nevertheless suggest that the public increasingly knows individuals who identify as nonbinary.

But the process is far from complete. While Dana Zzyym, an intersex Colorado resident won their petition to apply for a U.S. passport without selecting “male” or “female” in their application last year, that option is still not widely available to the American public. The State Department said that officially integrating an ‘X’ option for passports would “take approximately 24 months and cost $11 million.”

And there are dozens of other legal forms that ask for one’s sex, beyond travel documents. These can range from health records at hospitals toschool registration forms or prison records.

Yet while the costs states incur to make changes to these systems are high, they are often just a drop in the bucket in terms of overall budget.

“Given the size of California’s state budget, expenditures of these amounts are sometimes referred to as budget dust,” explained Scott Graves, director of research at the California Budget & Policy Center.

California will spend upward of $100 billion in 2019-20, meaning that the one-time cost of $880,000 is equal to 0.0006% of total General Fund spending in 2019-20. And even in comparison to other spending areas, the change made at the DMV is insignificant. For example, the 2019-20 California state budget allocates $453.8 million from the General Fund to the state’s Office of Emergency Services, Graves said.

In Pennsylvania, the cost of adding a binary option is also negligible in terms of the commonwealth’s overall budget of $86 billion, according to J.J. Abbott, press secretary to Governor Tom Wolf.

“This accounts for approximately 0.00014% of that total,” Abbott said. “Providing this option—and therefore stop discrimination based on gender identity—had no impact on other services.”