BILL ANALYSIS                                                                                                                                                                                                    Ó




                   Senate Appropriations Committee Fiscal Summary
                           Senator Christine Kehoe, Chair


          AB 1404 (Feuer) - Vehicle registration fee surcharge for vehicle 
          theft programs.
          
          Amended: August 6, 2012         Policy Vote: T&H 6-2
                             as proposed to be amended
          Urgency: No                     Mandate: No
          Hearing Date: August 6, 2012                           
          Consultant: Mark McKenzie       
          
          This bill does not meet the criteria for referral to the 
          Suspense File.
           
          
          Bill Summary: AB 1404 would authorize the Counties of Los 
          Angeles, San Diego, and San Bernardino to increase the fee 
          imposed upon registration of a vehicle to fund vehicle theft 
          programs from $1 to $2.  Upon approval of the increase that 
          applies to all vehicles, the amount imposed upon commercial 
          vehicles would increase from $2 to $4.

          Fiscal Impact: 
              All administrative costs to the Department of Motor 
              Vehicles (DMV) and the State Controller's Office (SCO) are 
              fully recovered from fee revenues collected.

              Potential revenue gains of approximately $7.2 million for 
              Los Angeles County, $2.5 million for San Diego County, and 
              $1.6 million for San Bernardino County if increases to 
              vehicle surcharges are approved.

          Background: Existing law, SB 2139 (Davis), Chapter 1670, 
          Statutes of 1990, authorizes counties to establish a separate 
          annual $1 vehicle registration surcharge to fund programs that 
          enhance the capacity of local police and prosecutors to deter, 
          investigate, and prosecute vehicle theft crimes.  The fee is 
          imposed upon adoption of a resolution by the board of 
          supervisors.  Owners of specified commercial vehicles pay an 
          additional $2.  DMV collects these fees and the SCO distributes 
          the revenues to participating counties.  All administrative 
          costs are recovered from fees collected.  Forty-seven counties 
          have adopted this surcharge, which generates approximately $29 
          million annually statewide, according to the latest report from 








          AB 1404 (Feuer)
          Page 1


          the SCO for the 2010-11 fiscal year.  The authority to collect 
          this additional surcharge sunsets on January 1, 2018.

          This bill is intended to increase vehicle theft fee in Los 
          Angeles, San Diego, and San Bernardino Counties to account for 
          inflation and to sufficiently fund the local programs.  Los 
          Angeles County, for example, reports that its vehicle theft 
          program, known as the Taskforce for Regional Auto-theft 
          Prevention (TRAP) employed 71 personnel to combat auto theft at 
          a cost of $7.3 million in 2004, but this year the program only 
          employed 29 personnel at a cost of $7.2 million.  

          Proposed Law: AB 1404, as proposed to be amended, would 
          authorize Los Angeles, San Diego, and San Bernardino Counties to 
          increase the vehicle theft surcharge imposed on all vehicles 
          subject to annual registration in their respective jurisdictions 
          from $1 to $2, upon adoption of a resolution by the county board 
          of supervisors.  The $2 surcharge that is currently imposed on 
          commercial vehicles would automatically increase from $2 to $4 
          upon approval of the resolution that would increase the 
          surcharge for all vehicles.  The bill would require the county 
          board of supervisors to submit the resolution to DMV at least 
          six months prior to the operative date of the fee increase.

          Related Legislation: AB 878 (Davis), introduced in 2007, 
          included provisions that would have allowed all counties to 
          increase vehicle registration surcharges that fund programs for 
          abandoned vehicle abatement and vehicle theft, prevention, 
          investigation, and prosecution programs.  AB 878 was vetoed by 
          Governor Schwarzenegger, who objected to the absence of voter 
          approval for the fee increase.

          Staff Comments: According to the most recent annual report by 
          the SCO, the vehicle theft surcharge generated approximately 
          $7.2 million for Los Angeles County, $2.5 million for San Diego 
          County, and $1.6 million for San Bernardino County in the 
          2010-11 fiscal year.  Upon approval of a resolution by each 
          county's board of supervisors, this bill would double the amount 
          of revenues available to each county for vehicle theft programs. 
           DMV and the SCO would continue to recover administrative costs 
          for collecting and distributing the fees.

          Proposed Author Amendments: The current bill would only apply to 
          Los Angeles County and would require approval of a separate 








          AB 1404 (Feuer)
          Page 2


          resolution for the imposition of an increased fee for commercial 
          vehicles.  The author has proposed amendments to also authorize 
          San Diego and San Bernardino Counties to increase the vehicle 
          theft program surcharge.  The proposed amendments would also 
          make the commercial vehicle surcharge increase automatic upon 
          approval of the increase that applies to general vehicles.