BILL ANALYSIS Ó AB 1324 Page 1 Date of Hearing: April 15, 2013 ASSEMBLY COMMITTEE ON TRANSPORTATION Bonnie Lowenthal, Chair AB 1324 (Skinner) - As Amended: March 21, 2013 SUBJECT : Vehicle registration fees: vehicle theft crimes Alameda County SUMMARY : Authorizes Alameda County Board of Supervisors (Alameda County) to increase the tax on vehicle registrations for the prevention of vehicle theft crimes. Specifically, this bill : 1)Authorizes Alameda County, upon adoption of a resolution, to increase the tax on the registration of motor vehicles from $1 to $2, and its commercial vehicle service tax from $2 to $4. 2)Requires that the resolution approved by Alameda County be submitted to the Department of Motor Vehicles (DMV) at least six months prior to the operative date of the tax increase. 3)Sunsets the provisions on January 1, 2018. EXISTING LAW : 1)Authorizes, until January 1, 2018, the Counties of Los Angeles, San Bernardino, and San Diego, to increase the motor vehicle tax from $1 to $2, and would provide that the service tax on commercial motor vehicles to increase from $2 to $4, upon adoption of a resolution of its board of supervisors. Requires the resolution to be submitted to DMV at least six months prior to the operative date of the tax increase. 2)Authorizes, until January 1, 2018, counties to adopt an annual $1 vehicle registration service fee for passenger vehicles and an annual $2 vehicle registration service fee for commercial vehicles where that fee is used exclusively to fund programs that enhance the capacity of local police and prosecutors to deter, investigate, and prosecute vehicle theft crimes. 3)Requires counties that adopt these service tax or fees (depending if the tax or fee were approved subsequent to the passage of Proposition 26 in November 2010) to report the expenditures for salaries and expenses, purchase of equipment AB 1324 Page 2 and supplies, and any other expenditure listed by type, with an explanatory comment. 4)Requires a vehicle registration fee of $46 to be paid for the registration of every motor vehicle, except those expressly exempt. 5)Authorizes a variety of additional fees that are related to the operation of motor vehicles to be paid with the registration, most particularly to address certain air quality and law enforcement issues. These fees support, among other things, service authorities for freeway emergencies, California Highway Patrol (CHP) staffing, and fingerprint identification programs. 6)Requires revenues collected for vehicle crime prevention be expended exclusively to fund programs that enhance the capacity of local police and prosecutors to deter, investigate, and prosecute vehicle theft crimes. However, in any county with a population of 250,000 or less, the money must be expended exclusively for those vehicle theft crime programs and for the prosecution of crimes involving driving while under the influence of alcohol or drugs, or both, or vehicular manslaughter, or any combination of those crimes. FISCAL EFFECT : Unknown COMMENTS : Existing law establishes a basic vehicle registration fee of $46, plus an additional $23 fee for additional personnel for the CHP, for the new or renewal registration of most vehicles or trailer coaches. Existing law also authorizes local agencies to impose separate vehicle registration fees in their respective jurisdictions for a variety of special programs, such as abating abandoned vehicles and deterring, investigating, and prosecuting vehicle theft. The vehicle theft program may be established in counties if approved through a resolution by a county board of supervisors that imposes a $1 fee on every new or renewal vehicle registration, plus another $2 on commercial vehicles. Smaller counties adopting vehicle theft programs (those with a population of less than 250,000) may also use the resulting funds to prosecute specified driving under the influence and vehicular manslaughter crimes. Each quarter, participating counties must submit to CHP a report on the expenditures and AB 1324 Page 3 activities as well as submitting a fiscal year end report to the California State Controller. Separately, the Counties of Los Angeles, San Bernardino, and San Diego are authorized to increase the motor vehicle tax from $1 to $2, and the service tax on commercial motor vehicles from $2 to $4, upon adoption of a resolution of its board of supervisors. This bill would provide Alameda County with the same authorization currently extended to the Counties of Los Angeles, San Bernardino, and San Diego, to increase the tax on motor vehicle registrations from $1 to $2, and the service tax on commercial motor vehicles from $2 to $4. The bill sunsets these provisions on January 1, 2018, that correlates to the sunset date established for the authorization for the other three counties. The author indicates that Alameda County faces an urgent need to address car theft citing, "From 2011 to 2012, 12,622 cars were reported stolen in the county, a 17% increase from 2011. This rate was higher than the 11% increase in car theft rates seen statewide. Increases were reported by almost every citywide police department in Alameda County, as well as by the Alameda County Sherriff's Office, BART Police, and CHP offices in the county." The author contends that the bill would provide Alameda County with much-needed funds to prevent and combat the growing problem of vehicle theft. This bill deals with the complicated issue of "fees" versus "taxes" and the vote requirements for each, as prescribed by Proposition 26, enacted in November 2010. Proposition 26 requires that any "change in statute which results in a taxpayer paying a higher tax must be imposed by an act passed by not less than two-thirds of all members elected to each of the two houses of the Legislature." This bill does not result in a taxpayer paying a higher tax but delegates to the separate county boards of supervisors the authority to impose a higher tax on vehicle registrations to fund a specific government function. Ultimately, the counsel for each county would have to determine a vote threshold at the county level. So while this bill is a majority vote measure in the Legislature, the local action to increase the registration tax may ultimately require a two-thirds vote of the electorate in a county. AB 1324 Page 4 Writing in opposition to this bill, the California Taxpayers Association indicates that the bill is a regressive tax thus imposing a greater burden upon lower- and middle-income taxpayers. The association further contends that the bill hides the true costs of government and that the taxes should be limited to paying for administrative costs incurred by DMV for the registration of vehicles. Legislative history : AB 767 (Levine), of 2013, would authorize the board of supervisors of all the counties within the state to increase the tax on vehicle registrations for the prevention of vehicle theft crimes. That bill was approved by this committee and is scheduled to be heard in the Assembly Local Government Committee. AB 1404 (Feuer) Chapter 775, Statutes of 2012, authorizes the Counties of Los Angeles, San Bernardino, and San Diego to increase their $1 vehicle registration tax for vehicle theft prevention to $2, and their commercial tax from $2 to $4. AB 1768 (Davis) of 2012, would have allowed for a $3 tax applying only to Los Angeles County. That bill failed passage in the Assembly Transportation Committee. AB 286 (Salas) Chapter 230, Statutes of 2009, extends the sunset date to the current date of January 1, 2018. AB 860 (Salas) of 2008, would have extended the sunset for the vehicle theft program (but did not contain an increase in the fee). That bill was vetoed by Governor Schwarzenegger with his generic veto message referencing the budget delay. AB 878 (Davis) of 2007, a similar bill that was vetoed by Governor Schwarzenegger who indicated that the voters should decide on the vehicle registration fee increase. SB 2139 (Davis), Chapter 1670, Statutes of 1990, establishes the initial vehicle theft crime prevention program funded through vehicle registration fees. Double-referral : This bill is double referred to the Assembly Local Government Committee. REGISTERED SUPPORT / OPPOSITION : AB 1324 Page 5 Support City of Oakland (sponsor) Opposition California Taxpayers Association Howard Jarvis Taxpayers Association Analysis Prepared by : Ed Imai / TRANS. / (916) 319-2093