FISCAL NOTE
Date Requested: February 22, 2021
Time Requested: 01:39 PM |
| Agency: |
Motor Vehicles, WV Division of |
|---|
| CBD Number: |
Version: |
Bill Number: |
Resolution Number: |
| 1323 |
Introduced |
SB386 |
|
|---|
| CBD Subject: |
Motor Vehicles |
|---|
|
FUND(S):
Road Fund
Sources of Revenue:
Special Fund
Legislation creates:
Decreases Existing Revenue, Increases Existing Expenses
Fiscal Note Summary
Effect this measure will have on costs and revenues of state government.
The purpose of this bill is to provide that the additional fee for the issuance of certain military special registration plates for motor vehicles be equal to either the lesser of $10 or the additional cost to produce the special plate. The bill also reduces the fee for the renewal of the registration of a motor vehicle issued certain military special registration plates to an amount equal to the actual cost of a registration renewal.
The bill affectively eliminates the one-time fee of $10.00 for the issuance of special military plates and replaces it with a fee specific to each plate. The new fee will range from $0.20 to $7.40. The bill also changes the registration renewal fee on all military plates from $50.00 to $9.00, except for the veteran motorcycle plate, which will increase from $8.00 to $9.00.
There are approximately 144,000 citizens eligible for this program. The Division estimates that all 144,000 will take advantage of the reduced fee with an average of 1.5 vehicles per veteran for total vehicles registered of 216,000 (144,000 x 1.5). The amount of the one-time fee is to be set at the amount of increased cost of production for each specific military plate. The average cost of the military plates is $6.97 with the standard class “A” plate costing $2.40. Therefore, the average increased cost to the agency would be $4.57 ($6.97 - $2.40) per plate. There are 17,500 vehicles that currently have a military plate. This leaves 198,500 vehicles that will need a new military registration plate. The Division’s cost of materials is expected to rise by $907,145.00 (198,500 vehicles X $4.57 increase cost).
Additional costs to be incurred by the agency are Mainframe programming of $900 (10 hours at 90 per hour) and reprogramming the cash register to accept the new fees of $9,200 (80 hours at $115 per hour). Adding up to a total first year expense $917,245 ($900 + $9,200 + $907,145).
After full implementation, the Division estimates 7,200 new registrants each year at a cost of materials of $32,904 (7,200 x $4.57).
First year revenue from the one-time plate fee would match the increase plate costs of $907,145 stated above. However, this should not be considered a “wash” transaction as the expenditure of the funds to purchase the plates will deplete the agencies spending authority and the collection of revenue will not replenish it.
The Division will no longer be issuing approximately 2,000 new plates per year with the $10 one-time fee for a reduction of revenue of $20,000 (2,000 * $10). There are currently 17,500 plates that will renew at a rate $41 less for a reduction of revenue of $717,500. There are approximately 1,000 veteran motorcycle plates that will renew for an additional $1 each for a total of $1,000 (1000 x $1). Total effect on revenue in the first year is $170,645 ($907,145 - $20,000 - $717,500 +$1,000).
After full implementation the Division will have revenue from the one-time fee of $32,904 ($4.57 increased plate cost x 7,200 new plates per year), reduction of revenue due to elimination of the $10 one-time fee of $20,000 (current yearly average), reduction of revenue due to $41 reduced registration fee $8,856,000 (216,000 vehicles x $41 reduction), and a $1,000 increase due to the increase of the Motorcycle registration fee. Total effect on revenue is a reduction of $8,842,096 ($32,904 – $20,000 – $8,856,000 + $1,000).
Fiscal Note Detail
| Effect of Proposal |
Fiscal Year |
2021
Increase/Decrease
(use"-") |
2022
Increase/Decrease
(use"-") |
Fiscal Year
(Upon Full
Implementation) |
| 1. Estmated Total Cost |
0 |
917,245 |
32,904 |
| Personal Services |
0 |
0 |
0 |
| Current Expenses |
0 |
917,245 |
32,904 |
| Repairs and Alterations |
0 |
0 |
0 |
| Assets |
0 |
0 |
0 |
| Other |
0 |
0 |
0 |
| 2. Estimated Total Revenues |
0 |
170,645 |
8,842,096 |
Explanation of above estimates (including long-range effect):
$900 Mainframe Programming
$9,200 Cash Register Programming
$10,100 Total Programming
$4.57 Increased Cost Per Plate
198,500 New Plates
$907,145 Total Cost of Military Plate
$917,245 Total Current Expense
Revenue
$4.57 Increased Cost Per Plate
198,500 New Plates
$907,145 Total Cost of Military Plate
2,000 Approximate New Plates Per Year
-$10 Existing One Time Fee
-$20,000 Revenue Reduction
17,500 Current Plate
-$41 Renewal Fee Reduction Per Plate
-$717,500 Revenue Generated
1,000 Approximate Veteran “G” Plates
$1 Registration Increase
$1,000 Increase “G” Plate Revenue
$170,645 Net Revenue Change
$4.57 Increased Cost Per Plate
7,200 New Plate
$32,904 Total Increase Plate Cost
$4.57 Increased Cost Per Plate
7,200 New Plate
$32,904 Total Increase Plate Cost
2,000 Approximate New Plates Per Year
-$10 Existing One Time Fee
-20,000 Revenue Reduction
216,000 Estimated Total Vehicles
-$41 Per Item Revenue Reduction
-$8,856,000 Revenue Reduction
1,000 Approximate Veteran “G” Plates
$1 Registration Increase
$1,000 Increase “G” Plate Revenue
-$8,842,096
Memorandum
Person submitting Fiscal Note: Raeann Kriner
Email Address: raeann.k.kriner@wv.gov