Amended in Senate June 20, 2016

Amended in Assembly May 27, 2016

Amended in Assembly March 18, 2016

California Legislature—2015–16 Regular Session

Assembly Bill No. 2175

Introduced by Assembly Member Jones

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(Coauthors: Assembly Members Gallagher, Mathis, Olsen, and Wagner)

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(Coauthors: Senators Anderson, Bates, and Berryhill)

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February 18, 2016

An act to amend Section 8352.6 of the Revenue and Taxation Code, relating to fuel taxes.

LEGISLATIVE COUNSEL’S DIGEST

AB 2175, as amended, Jones. Fuel taxes: Off-Highway Vehicle Trust Fund.

Existing law imposes an excise tax on motor vehicle fuel (gasoline). Existing law, as a result of the elimination of the sales tax on gasoline effective July 1, 2010, provides for a commensurate increase in the excise tax on gasoline. These taxes are deposited to the Motor Vehicle Fuel Account in the Transportation Tax Fund. Existing law requires certain moneys attributable to taxes imposed upon distribution of gasoline related to specified off-highway motor vehicles and off-highway vehicle activities to be transferred monthly from the Motor Vehicle Fuel Account to the Off-Highway Vehicle Trust Fund. Existing law, however, transfers, with respect to the increase in gasoline excise taxes as a result of the elimination of the sales tax on gasoline, to the General Fund the revenues attributable to off-highway vehicles that would otherwise be deposited in the Off-Highway Vehicle Trust Fund. Existing law also requires the Controller to withhold $833,000 from the monthly transfer, and transfer that amount to the General Fund. The moneys in the Off-Highway Vehicle Trust Fund are required to be used, upon appropriation, for specified purposes related to off-highway motor vehicle recreation.

This bill would, on June 30, 2017, eliminate the requirement that the Controller withhold $833,000 from the monthly transfer and transfer it to the General Fund and would thereby transfer this amount monthly to the Off-Highway Vehicle Trust Fund.

Vote: majority. Appropriation: no. Fiscal committee: yes. State-mandated local program: no.

The people of the State of California do enact as follows:

SECTION 1.  

Section 8352.6 of the Revenue and Taxation
Code is amended to read:

8352.6.  

(a) (1) Subject to Section 8352.1, and except as
otherwise provided in paragraphs (2) and (3), on the first day of
every month, there shall be transferred from moneys deposited to
the credit of the Motor Vehicle Fuel Account to the Off-Highway
Vehicle Trust Fund created by Section 38225 of the Vehicle Code
an amount attributable to taxes imposed upon distributions of motor
vehicle fuel used in the operation of motor vehicles off highway
and for which a refund has not been claimed. Transfers made
pursuant to this section shall be made begin delete prior to end delete begin insert before end insert transfers
pursuant to Section 8352.2.

(2) Commencing July 1, 2012, the revenues attributable to the
taxes imposed pursuant to subdivision (b) of Section 7360 and
Section 7361.1 and otherwise to be deposited in the Off-Highway
Vehicle Trust Fund pursuant to paragraph (1) shall instead be
transferred to the General Fund. The revenues attributable to the
taxes imposed pursuant to subdivision (b) of Section 7360 and
Section 7361.1 that were deposited in the Off-Highway Vehicle
Trust Fund in the 2010-11 and 2011-12 fiscal years shall be
transferred to the General Fund.

(3) Until June 30, 2017, the Controller shall withhold eight
hundred thirty-three thousand dollars ($833,000) from the monthly
transfer to the Off-Highway Vehicle Trust Fund pursuant to
paragraph (1), and transfer that amount to the General Fund.

(b) The amount transferred to the Off-Highway Vehicle Trust
Fund pursuant to paragraph (1) of subdivision (a), as a percentage
of the Motor Vehicle Fuel Account, shall be equal to the percentage
transferred in the 2006-07 fiscal year. Every five years, starting
in the 2013-14 fiscal year, the percentage transferred may be
adjusted by the Department of Transportation in cooperation with
the Department of Parks and Recreation and the Department of
Motor Vehicles. Adjustments shall be based on, but not limited
to, the changes in the following factors since the 2006-07 fiscal
year or the last adjustment, whichever is more recent:

(1) The number of vehicles registered as off-highway motor
vehicles as required by Division 16.5 (commencing with Section
38000) of the Vehicle Code.

(2) The number of registered street-legal vehicles that are
anticipated to be used off highway, including four-wheel drive
vehicles, all-wheel drive vehicles, and dual-sport motorcycles.

(3) Attendance at the state vehicular recreation areas.

(4) Off-highway recreation use on federal lands as indicated by
the United States Forest Service’s National Visitor Use Monitoring
and the United States Bureau of Land Management’s Recreation
Management Information System.

(c) It is the intent of the Legislature that transfers from the Motor
Vehicle Fuel Account to the Off-Highway Vehicle Trust Fund
should reflect the full range of motorized vehicle use off highway
for both motorized recreation and motorized off-road access to
other recreation opportunities. Therefore, the Legislature finds that
the fuel tax baseline established in subdivision (b), attributable to
off-highway estimates of use as of the 2006-07 fiscal year,
accounts for the three categories of vehicles that have been found
over the years to be users of fuel for off-highway motorized
recreation or motorized access to nonmotorized recreational
pursuits. These three categories are registered off-highway
motorized vehicles, registered street-legal motorized vehicles used
off highway, and unregistered off-highway motorized vehicles.

(d) It is the intent of the Legislature that the off-highway motor
vehicle recreational use to be determined by the Department of
Transportation pursuant to paragraph (2) of subdivision (b) be that
usage by vehicles subject to registration under Division 3
(commencing with Section 4000) of the Vehicle Code, for
recreation or the pursuit of recreation on surfaces where the use
of vehicles registered under Division 16.5 (commencing with
Section 38000) of the Vehicle Code may occur.

(e) In the 2014-15 fiscal year, the Department of Transportation,
in consultation with the Department of Parks and Recreation and
the Department of Motor Vehicles, shall undertake a study to
determine the appropriate adjustment to the amount transferred
pursuant to subdivision (b) and to update the estimate of the amount
attributable to taxes imposed upon distributions of motor vehicle
fuel used in the operation of motor vehicles off highway and for
which a refund has not been claimed. The department shall provide
a copy of this study to the Legislature no later than January 1,
2016.