BILL ANALYSIS
SB 636
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Date of Hearing: June 17, 2009
ASSEMBLY COMMITTEE ON LOCAL GOVERNMENT
Anna Marie Caballero, Chair
SB 636 (Ashburn) - As Amended: April 30, 2009
SENATE VOTE : 38-0
SUBJECT : Vehicle license fees.
SUMMARY : Allows Nevada County to redirect proceeds from an
increase in vehicle license fee (VLF) funds contained in the
February 2009 State Budget. Specifically, this bill :
1)States, for Nevada County, that additional revenue received
resulting from the increase in VLF enacted as a part of the
February 2009 State Budget is not revenue derived from taxes
imposed pursuant to the VLF statute, for purposes of a local
ordinance that governs the expenditure of VLF funds received.
2)Provides that the provisions of the bill will cease to exist
on July 1, 2011, unless certain conditions are met, which
would then extend the bill's provisions until July 1, 2013.
3)Specifies that the Legislature finds and declares that due to
the unique circumstances relating to a local ordinance
governing the expenditure of VLF funds received by Nevada
County that a general statute cannot be made applicable, and
declares that the provisions of this bill are only applicable
to Nevada County.
EXISTING LAW :
1)Provides for the imposition of an annual VLF for any vehicle
subject to registration in California in the amount of 0.65%
of the market value.
2)Provides, on or after May 19, 2009, for the VLF rate to be
increased temporarily to 1% for specified vehicles and
requires that the revenues derived from the increase be
deposited into the General Fund.
3)Provides, on or after May 19, 2009, for a temporary additional
0.15% increase in the VLF rate in addition to 1) and 2) above,
to be deposited in the General Fund and transferred to the
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Local Safety and Protection Account.
FISCAL EFFECT : None
COMMENTS :
1)In lieu of a property tax on motor vehicles, the state
collects an annual VLF and allocates the revenues, minus
administrative costs, to cities and counties. The most recent
State Budget increased the VLF rate on most vehicles from
0.65% to 1.15% of a vehicle's value (AB X3 3, Evans, Chapter
18, Statutes of 2009). The increased rate took effect on May
19, 2009, and will cease on June 30, 2011.
2)In March of 1996, Nevada County voters approved Measure F, an
initiative which required that all funds received from the
State of California from VLF funds, as defined in the State
Constitution and in statute, must be segregated into a
separate accounting fund. The initiative required that the
County must spend at least half of those funds in each fiscal
year only for public roads, ways, and highways for maintenance
repair, circulation enhancement, general road safety, and fire
access in the unincorporated portion of the County.
3)Nevada County officials believe that Measure F will require
them to make a general fund expenditure on roads in an amount
equal to half of the amount of additional VLF revenues that
are allocated to them for law enforcement purposes under the
State Budget, enacted in February of 2009. The author
believes that state law needs to be clarified to ensure that
the additional VLF revenues provided to Nevada County under
the recently enacted budget do not constitute VLF funding for
the purposes of Nevada County's Measure F initiative.
4)SB 636 specifies that the provisions in the bill will sunset
on July 1, 2011, unless an amendment to the California
Constitution is approved at a statewide election held during
the 2009 calendar year, that limits the total amount that,
under Section 20 of Article XVI of the Constitution, may be
transferred by statute from the Budget Stabilization Account,
or any successor to that account, to the General Fund. If
such an amendment were approved, the bill would sunset on July
1, 2013. It should be noted that voters, during the May 19,
2009 special election, did not approve the spending cap
measure, which would have allowed for the increased VLF rate
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to expire two years later in June of 2013.
6)This bill has been double-referred to the Committees on Local
Government and Revenue and Taxation.
REGISTERED SUPPORT / OPPOSITION :
Support
Nevada County Board of Supervisors [SPONSOR]
CA State Association of Counties
Regional Council of Rural Counties
Opposition
None on file
Analysis Prepared by : Debbie Michel / L. GOV. / (916)
319-3958