BILL ANALYSIS
AB 2303
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Date of Hearing: April 12, 2010
ASSEMBLY COMMITTEE ON TRANSPORTATION
Bonnie Lowenthal, Chair
AB 2303 (Tran) - As Introduced: February 19, 2010
SUBJECT : Vehicle registration: installment payments
SUMMARY : Requires the Department of Motor Vehicles (DMV) to
implement a program allowing certain registrants to pay their
vehicle registration fees by installment. Specifically, this
bill :
1)Requires DMV, by January 1, 2012, to implement by regulation
an installment payment program for payment of vehicle
registration fees.
2)Requires the program to be limited to individuals who are
receiving unemployment compensation or who meet state poverty
guidelines as determined by an unspecified entity.
3)Requires DMV to confirm eligibility of an individual prior to
his or her enrollment in the program.
4)Requires DMV to charge $5 for each installment payment.
EXISTING LAW :
1)Prohibits any person driving, moving, or leaving standing upon
a highway, or in an offstreet public parking facility, any
motor vehicle, unless it is registered and the appropriate
fees have been paid.
2)Requires the payment of fees as part of the original
registration and registration renewal process.
FISCAL EFFECT : Unknown
COMMENTS : As the California economy struggles with an
unemployment rate in excess of 12%, homeowners default on their
mortgages, and poverty levels continue to climb, more and more
car owners have difficulty meeting their obligation to keep
their registration current. It is against this backdrop that
the author of this bill proposes to allow unemployed or
otherwise poverty-stricken motorists to pay their vehicle
AB 2303
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registration fees by installment rather than in one annual
payment.
While this may seem to be an attractive means of easing economic
stress, it should be noted that this bill requires DMV to
include a fee of $5 for each installment payment. Thus, for a
registration bill of $180, a vehicle owner would pay a total of
$20 in fees if he or she chose to pay the registration in
quarterly $50 payments, or $60 in fees if he or she chose to pay
the registration in monthly $20 payments. This would appear to
add to the burden of paying one's registration, rather than
easing it. Additionally, DMV would face the administrative
burden of processing multiple registration payments as well as
verifying the unemployment or poverty status of each vehicle
owner who opted for the installment payment alternative. While
DMV continues to modernize its information technology
infrastructure, recent experience suggests that the cost and
time of the undertaking required of DMV by this bill would
quickly overwhelm any revenue generated by the $5 fee.
The various opponents of this bill point out that it would
result in a reduction in counties' vehicle license fee (VLF)
allocations as a result of DMV's administrative costs of
implementing an installment program, which would come "off the
top" of county allocations. "With the marked decline in VLF
revenues, county programs are already suffering and cannot bear
the additional burden of funding an installment program.
Further, vehicle owners currently have the option to pay their
registration fees by credit card, which is essentially an
installment plan with payments owed to banks."
REGISTERED SUPPORT / OPPOSITION :
Support
None received
Opposition
California Mental Health Directors Association
California State Association of Counties
County Health Executives Association of California
Regional Council of Rural Counties
Urban Counties Caucus
AB 2303
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Analysis Prepared by : Howard Posner / TRANS. / (916) 319-2093