BILL ANALYSIS �
Senate Appropriations Committee Fiscal Summary
Senator Kevin de Le�n, Chair
AB 244 (Bonilla) - Veterans license plates.
Amended: August 12, 2013 Policy Vote: VA 7-0; T&H 11-0
Urgency: No Mandate: No
Hearing Date: August 19, 2013
Consultant: Mark McKenzie
This bill does not meet the criteria for referral to the
Suspense File.
Bill Summary: AB 244 would require the Department of Veterans
Affairs (DVA) to sponsor a veterans specialized license plate
program. The Department of Motor Vehicles (DMV) would establish
the program only after DVA receives at least 7,500 applications
and submits the applications and fees to DMV, as specified.
Fiscal Impact:
DVA costs of approximately $45,000 for 1/2 PY of staff time
in 2014-15 to collect the initial 7,500 applications and
fees for the establishment of the plate program (General
Fund). These costs could continue into 2015-16 if the
requisite applications and fees are not collected within the
first year.
DMV implementation costs of approximately $470,000, likely
in 2015-16, partially offset by pre-paid application fees of
$375,000, leaving a net cost of approximately $95,000 (Motor
Vehicle Account). These net costs would be reimbursed in
the following fiscal year by registration renewal fees from
holders of the veterans plates. All ongoing costs
thereafter would be fully offset by fees from renewals and
issuance of new veterans plates.
Unknown revenues, likely in the range of $150,000 to
$250,000 annually, for deposit into the Veterans Service
Office Fund (based on 7,500 plates after subtracting DMV
administrative costs). These funds are distributed to
county veterans service offices.
Unknown, likely relatively minor revenue gains, to the
extent that applicants wish to have personalized
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"environmental" plates (Environmental License Plate Fund).
Background: Existing law, AB 84 (Leslie), Chap 454/2006,
authorizes any state agency to sponsor a special interest
license plate, and apply to DMV to establish a new license plate
program after collecting at least 7,500 applications and
accompanying fees and submitting them to DMV. The applications
must be collected within one year, with an option to extend that
timeframe by an additional year under specified conditions. The
new specialized license plate must have a design or contain a
message that publicizes or promotes a state agency, or the
official policy, mission, or work of the agency. A sponsoring
agency may not spend more than 25 percent of its license plate
fees for administrative, marketing, and promotional costs
associated with the plate.
Existing law authorizes any registered vehicle owner to apply to
DMV for veterans' organization license plates. Veterans'
organizations plates bear a distinctive design that includes the
words "honoring veterans" along the bottom of the plate and a
decal on the left side of the plate for one of over 100
sponsoring veterans' organizations, such as the American Legion,
101st Airborne Division, or the National Guard. In addition to
standard registration fees, a vehicle owner must pay the
following fees related to veterans organization plates: $50 for
the initial issuance of the plates and decals; $40 annually to
renew the plates and decals; $15 for transfer of the plates to
another vehicle; $35 for replacement of damaged plates; $10 for
replacement of damaged decals; and $78 to personalize the
plates. Revenues derived from the veterans' organization
plates, less costs incurred by DMV in administering the program,
are deposited into the Veterans Service Office Fund for
distribution to county veterans service offices by the
Department of Veterans Affairs, upon appropriation by the
Legislature.
From 1993 through 2010, DMV offered a special license plate to
all registered vehicle owners with the word "veteran" along the
bottom of the plate and space for a decal on the left side of
the plate for one of over 100 sponsoring veterans'
organizations, such as the American Legion, 101st Airborne
Division, or the National Guard. To broaden the appeal of this
specialty plate program, AB 1908 (Cook), Chap 166/2010, replaced
the "veteran" plate with an "honoring veterans" plate. Although
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neither plate was limited strictly to veterans of military
service, proponents believed this change would encourage more
vehicle owners to purchase the specialized plate and increase
revenues to county veterans services offices.
Proposed Law: AB 244 would require DVA to apply to DMV to
sponsor a veterans license plate program, and require DMV to
issue license plates and decals that are identical to those
issued prior to 2010 for that program if DVA meets the
requirements specified in existing law. The fees for the new
"veterans" plate would be the same as those that apply to the
current "honoring veterans" plate. After deducting
administrative costs, DMV would deposit additional fee revenue
into the Veterans Service Office Fund.
Staff Comments: DMV indicates that as of December, 2012 there
were 29,995 sets of veterans' organization plates issued to
registered vehicles. In the 2011 calendar year, DMV incurred
$105,584 in costs to administer this specialized license plate
program, which was fully covered by fees collected, and
deposited the remaining $667,281 in veterans license plate fee
revenue into the Veterans Service Office Fund.
Staff notes that with the enactment of this bill, and assuming
DVA collects the requisite number of applications and
accompanying fees, DMV would offer two separate license plates
associated with veterans. Any registered vehicle owner would be
eligible to purchase a license plate with either a message
"honoring veterans" or "veteran" along the bottom of the plate.
The revenues generated from both plates, after paying DMV's
administrative costs, would benefit county veterans services
offices. Neither plate would be restricted to veterans of
military service. The Committee may wish to consider whether
the creation of a second specialized license plate that benefits
the same population as the existing plate would represent a
highest and best use of DMV resources. The programming and
administration costs associated with establishing a new plate
program detract from DMV's core mission and goals.