BILL ANALYSIS �
AB 22 X1
Page 1
CONCURRENCE IN SENATE AMENDMENTS
AB 22 X1 (Budget Committee)
As Amended June 14, 2011
Majority vote. Budget Bill Appropriation Takes Effect
Immediately
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|ASSEMBLY: | |(June 3, 2011) |SENATE: |24-15|(June 15, |
| | | | | |2011) |
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(vote not relevant)
SUMMARY : Recalculates the cost shares for Department of Motor
Vehicles (DMV) administration funded from different fees and
taxes collected on vehicles, as part of the 2011-12 budget
package. The administrative costs paid by Vehicle License Fee
(VLF) tax would be reduced, and the administrative costs paid
from vehicle registration fees would be increased. As a result,
the amount of VLF directed to local governments would increase
by $300 million to support public safety realignment. Vehicle
registration fees would be increased by $12 per vehicle to cover
the new cost share from registration fees.
The Senate amendments delete the Assembly version of this bill,
and instead:
1)Set the cost share of the VLF for Department of Motor Vehicles
administration at $25 million in 2011-12 and grows it annually
thereafter at the rate of the California Consumer Price Index.
If the Department of Finance finds in the future that the
amount provided from the VLF is not sufficient to cover the
DMV's costs of collecting the VLF, it shall notify the
Legislature and propose the necessary budget adjustments. By
reducing the share of administrative costs paid out of the
VLF, this bill would result in an additional $300 million in
VLF revenue to allocate to cities and counties. The bill
directs this $300 million into the Local Revenue Fund 2011 to
be used for Public Safety Realignment.
2)Increase the base motor vehicle registration fee by $12 per
year. This fee increase will result in new annual fee revenue
of about $300 million to cover the administration cost of the
DMV that this bill is shifting to registration fees.
3)Add an appropriation allowing his bill to take effect
AB 22 X1
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immediately upon enactment.
AS PASSED BY THE ASSEMBLY , this bill expresses the intent of the
Legislature to enact statutory changes relating to the 2011
Budget Act.
FISCAL EFFECT : This bill will generate an ongoing General Fund
savings of $300 million.
COMMENTS : By setting the administrative costs for DMV of
collecting the VLF at $25 million, the costs or collection as a
share of total VLF tax collected is about 1%. This is
proportionally similar to the cost of collection for the
Franchise Tax Board for the personal income tax and the
corporate tax, and similar to the cost of collection for the
Board of Equalization for the sales tax.
Analysis Prepared by : Christian Griffith / BUDGET / (916)
319-2099
FN: 0001295