BILL ANALYSIS �
Senate Appropriations Committee Fiscal Summary
Senator Christine Kehoe, Chair
SB 1209 (Runner) - Vehicle registration fees: nonresident owners
Amended: April 23, 2012 Policy Vote: T&H 9-0
Urgency: No Mandate: No
Hearing Date: May 7, 2012 Consultant: Mark McKenzie
This bill meets the criteria for referral to the Suspense File.
Bill Summary: SB 1209 would require nonresident owners to pay an
additional fee on vehicle registrations and continuously
appropriate the revenues to the California Highway Patrol (CHP)
and Department of Justice (DOJ) to support public safety warning
systems.
Fiscal Impact:
One-time Department of Motor Vehicles (DMV) programming
costs of at least $194,288 (Motor Vehicle Account) to
establish the new fee for imposition only on vehicles
registered to nonresident owners. Ongoing DMV
administrative costs, likely in the range of $100,000
annually, deducted from fees collected.
Unknown fee revenue gain, likely in the range of $1.7
million annually, distributed evenly to CHP and DOJ.
Background: Existing law establishes a basic vehicle
registration fee of $46, plus a $23 surcharge for additional
personnel for the California Highway Patrol (CHP), and
authorizes local agencies to impose separate vehicle
registration fee surcharges in their respective jurisdictions
for a variety of special programs, including $1 for fingerprint
identification programs, up to $19 for air quality programs, and
$1 for programs to dispose of abandoned vehicles. Since DMV
assigns local vehicle surcharges based upon the registered
owner's address, those vehicles registered to owners with
out-of-state addresses only pay the basic $46 registration fee
and the $23 CHP surcharge and escape payment of any
locally-imposed surcharges.
Proposed Law: SB 1209 would require an additional fee to be paid
at the time of registration of a vehicle registered to a
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nonresident owner with an out-of-state residence or business
address. The fee would be applicable for initial and renewal
registrations that are due on or after July 1, 2013. The amount
of the fee would be either $10 or the average statewide amount
of locally-imposed vehicle registration surcharges in the
immediately preceding fiscal year, as determined by DMV. After
deduction of DMV administrative costs, the fee revenues would be
continuously appropriated as follows: fifty percent to CHP for
support of databases and public warning systems that alert
motorists and the general public of abductions, shootings, and
other imminent public safety threats, and 50 percent to DOJ to
maintain criminal justice databases designed to enhance the
effectiveness of public safety warning systems.
Staff Comments: DMV indicates that approximately 172,000
California vehicles were registered to owners with an
out-of-state address in 2011. If DMV were to impose a $10 fee,
SB 1209 would generate approximately $1.72 million in revenues
annually for distribution to CHP and DOJ, and to cover DMV's
administrative costs. Staff notes that this fee would appear to
generate revenues that exceed the current costs to administer
the specified public safety warning systems. For instance, CHP
notes that it conducted 16 Amber Alerts in 2011 that ran for a
total of 494 hours. Total staffing costs related to those
alerts was approximately $189,500, which is less than a quarter
of the estimated $850,000 in revenues that the new vehicle fee
would generate for CHP.
If DMV established a flat $10 fee, the department would incur
one-time costs of approximately $194,288 in 2012-13 to program
department systems to provide for the collection of fees from a
certain class of nonresident vehicle owners. These costs would
be incurred prior to the collection of any fee revenue. A
variable fee would be very difficult and more costly to program.
Staff notes that the imposition of fees on a certain class of
vehicle owners based solely on residency raises potential
constitutional issues. For instance, the California Supreme
Court held, in Woosley vs. State of California (1992) 3 Cal. 4th
758, 13 Cal. Rptr. 2d 30, that the manner in which the State
assessed vehicle license fees on certain nonresident vehicles
brought into the state was unconstitutional. Furthermore,
existing law authorizes California to enter into the
International Registration Plan (IRP), which provides for a
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system of registration for entities involved in interstate
trucking. California entered the IRP over 10 years ago, so this
bill as it applies to IRP vehicles would likely be preempted by
federal law.
Recommended Amendments: In order to maintain legislative
oversight of the fee revenue charged to nonresident vehicle
owners, staff recommends an amendment to delete the continuous
appropriation and instead make the revenues available to CHP and
DOJ upon appropriation by the Legislature.