BILL ANALYSIS
Senate Appropriations Committee Fiscal Summary
Senator Christine Kehoe, Chair
205 (Hancock)
Hearing Date: 4/27/09 Amended: 4/14/09
Consultant: Mark McKenzie Policy Vote: T.&H. 7-4
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BILL SUMMARY: SB 205 would authorize a "countywide
transportation planning agency" to place a majority vote measure
on the ballot to impose an annual vehicle registration fee of up
to $10 on each motor vehicle registered in the county for
specified transportation-related purposes.
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Fiscal Impact (in thousands)
Major Provisions 2009-10 2010-11 2011-12 Fund
DMV programming startup costs paid in advance
throughLocal
contract with authorizing agency, ongoing
costs reimbursed from fees collected
Local revenues unknown annual revenue gain for each
Local
county that approves the fee
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STAFF COMMENTS:
Existing law establishes a basic statewide vehicle registration
fee of $34, plus a $22 surcharge that supports the California
Highway Patrol, and authorizes local agencies to impose separate
vehicle registration fee surcharges within their jurisdictions
for various programs, such as air quality district fees,
congestion management fees, and law enforcement fees. Existing
law also requires congestion management agencies in urbanized
counties to prepare and adopt a congestion management program,
which is updated every two years.
This bill would authorize a "countywide transportation planning
agency," defined as a congestion management agency or the agency
designated to submit the county transportation plan, to place a
majority vote measure on the ballot to impose an annual vehicle
registration fee of up to $10 on each motor vehicle registered
in the county for specified transportation-related projects and
programs. The ballot measure resolution would require passage
by a majority vote of the local agency's governing body and
include a finding of fact that the projects and programs funded
by the fee are consistent with the regional transportation plan
and they have a relationship or benefit to those paying the fee.
According to DMV statistics, there were 31,363,851 fee-paid
vehicle registrations in the state in 2008. This bill could
generate up to $313.6 million annually for local transportation
purposes if every county approved a ballot measure to impose an
additional $10 vehicle registration fee.
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SB 205 (Hancock)
DMV would be required to administer the collection and
distribution of the fees on behalf of each countywide
transportation planning agency that received voter approval to
impose the new surcharge. Initial costs for programming the new
fee into DMV's processing system would likely be in the range of
$250,000 for each approved fee. These costs would be paid up
front by the agency imposing the fee through a direct contract
with DMV. These initial costs would be repaid to the local
agency from the initial revenues distributed by DMV. Ongoing
administrative costs to DMV would be deducted from fees
collected prior to distribution to the local agency.
DMV notes a concern about technical problems on their archaic
processing systems caused by the cumulative pressures placed on
these systems from the proliferation of fee codes. This bill
may result in an increase in vehicle transactions that must be
manually processed to the extent that numerous counties impose
the new registration fee and transaction errors occur more
frequently. DMV is currently in the process of updating their
information technology systems. This modernization project
should be completed by 2013, at which time transactions will be
processed more efficiently and with fewer errors.
Staff notes that in order for a surcharge to qualify as a fee
rather than a tax, there must be a nexus between the payer of
the fee and the projects or programs to be funded by the fee,
and the level of the fee must be proportional to the benefits
derived from the fee revenues. SB 205 would require a finding
of fact that the projects and programs to be funded by the
additional vehicle registration fee have a relationship or
benefit to the persons paying the fee. This bill would further
require submittal to the electorate and approval by a majority
vote, which is consistent with the requirements for the
imposition of locally-imposed fees. General purpose taxes for
general purposes also require approval by a majority of the
electorate. Special taxes for specific purposes, on the other
hand, including the optional cent sales and use tax for
transportation purposes, require the submittal to the electorate
and approval by a 2/3 vote pursuant to Article XIII C Section 2
of the California Constitution (Proposition 218).
Staff notes that SB 1611 (Simitian), which was held in the
Assembly Appropriations Committee in 2006, would have authorized
a congestion management agency or county board of supervisors to
place a majority vote ballot measure before the voters to impose
an annual vehicle registration fee of up to $25 on motor
vehicles registered in the county to fund transportation-related
projects and programs. The structure and content of SB 205 is
substantially similar to SB 1611.