AB 2175: Fuel taxes: Off-Highway Vehicle Trust Fund.
- Session Year: 2015-2016
- House: Assembly
- Latest Version Date: 2016-06-20
Existing law imposes an excise tax on motor vehicle fuel (gasoline). Existing law, as a result of the elimination of the sales tax on gasoline effective July 1, 2010, provides for a commensurate increase in the excise tax on gasoline. These taxes are deposited to the Motor Vehicle Fuel Account in the Transportation Tax Fund. Existing law requires certain moneys attributable to taxes imposed upon distribution of gasoline related to specified off-highway motor vehicles and off-highway vehicle activities to be transferred monthly from the Motor Vehicle Fuel Account to the Off-Highway Vehicle Trust Fund. Existing law, however, transfers, with respect to the increase in gasoline excise taxes as a result of the elimination of the sales tax on gasoline, to the General Fund the revenues attributable to off-highway vehicles that would otherwise be deposited in the Off-Highway Vehicle Trust Fund. Existing law also requires the Controller to withhold $833,000 from the monthly transfer, and transfer that amount to the General Fund. The moneys in the Off-Highway Vehicle Trust Fund are required to be used, upon appropriation, for specified purposes related to off-highway motor vehicle recreation.
This bill would, on June 30, 2017, eliminate the requirement that the Controller withhold $833,000 from the monthly transfer and transfer it to the General Fund and would thereby transfer this amount monthly to the Off-Highway Vehicle Trust Fund.
Existing law imposes an excise tax on motor vehicle fuel (gasoline). Existing law, as a result of the elimination of the sales tax on gasoline effective July 1, 2010, provides for a commensurate increase in the excise tax on gasoline. These taxes are deposited to the Motor Vehicle Fuel Account in the Transportation Tax Fund. Existing law requires certain moneys attributable to taxes imposed upon distribution of gasoline related to specified off-highway motor vehicles and off-highway vehicle activities to be transferred monthly from the Motor Vehicle Fuel Account to the Off-Highway Vehicle Trust Fund. Existing law, however, transfers, with respect to the increase in gasoline excise taxes as a result of the elimination of the sales tax on gasoline, to the General Fund the revenues attributable to off-highway vehicles that would otherwise be deposited in the Off-Highway Vehicle Trust Fund. Existing law also requires the Controller to withhold $833,000 from the monthly transfer, and transfer that amount to the General Fund. The moneys in the Off-Highway Vehicle Trust Fund are required to be used, upon appropriation, for specified purposes related to off-highway motor vehicle recreation.
This bill would would, on June 30, 2017, eliminate the requirement that the Controller withhold $833,000 from the monthly transfer and transfer it to the General Fund and would thereby transfer this amount monthly to the Off-Highway Vehicle Trust Fund.
Existing law imposes an excise tax on motor vehicle fuel (gasoline). Existing law, as a result of the elimination of the sales tax on gasoline effective July 1, 2010, provides for a commensurate increase in the excise tax on gasoline. These taxes are deposited to the Motor Vehicle Fuel Account in the Transportation Tax Fund. Existing law requires certain moneys attributable to taxes imposed upon distribution of gasoline related to specified off-highway motor vehicles and off-highway vehicle activities to be transferred monthly from the Motor Vehicle Fuel Account to the Off-Highway Vehicle Trust Fund. Existing law, however, transfers, with respect to the increase in gasoline excise taxes as a result of the elimination of the sales tax on gasoline, to the General Fund the revenues attributable to off-highway vehicles that would otherwise be deposited in the Off-Highway Vehicle Trust Fund. Existing law also requires the Controller to withhold $833,000 from the monthly transfer, and transfer that amount to the General Fund. The moneys in the Off-Highway Vehicle Trust Fund are required to be used, upon appropriation, for specified purposes related to off-highway motor vehicle recreation.
This bill would eliminate the requirement that the Controller withhold $833,000 from the monthly transfer and transfer it to the General Fund and would thereby transfer this amount monthly to the Off-Highway Vehicle Trust Fund.
The Personal Income Tax Law imposes taxes on taxable income and provides definitions of specified terms for purposes of that law, including a definition for taxable year.
This bill would make a nonsubstantive change to that definition provision.
The Personal Income Tax Law imposes taxes on taxable income and provides definitions of specified terms for purposes of that law, including a definition for taxable year.
This bill would make a nonsubstantive change to that definition provision.
(a)(1)Subject to Section 8352.1, and except as otherwise provided in paragraphs (2) and (3), on the first day of every month, there shall be transferred from moneys deposited to the credit of the Motor Vehicle Fuel Account to the Off-Highway Vehicle Trust Fund created by Section 38225 of the Vehicle Code an amount attributable to taxes imposed upon distributions of motor vehicle fuel used in the operation of motor vehicles off highway and for which a refund has not been claimed. Transfers made pursuant to this section shall be made prior to before transfers pursuant to Section 8352.2.
(2)Commencing July 1, 2012, the revenues attributable to the taxes imposed pursuant to subdivision (b) of Section 7360 and Section 7361.1 and otherwise to be deposited in the Off-Highway Vehicle Trust Fund pursuant to paragraph (1) shall instead be transferred to the General Fund. The revenues attributable to the taxes imposed pursuant to subdivision (b) of Section 7360 and Section 7361.1 that were deposited in the Off-Highway Vehicle Trust Fund in the 201011 and 201112 fiscal years shall be transferred to the General Fund.
(3)Until June 30, 2017, the Controller shall withhold eight hundred thirty-three thousand dollars ($833,000) from the monthly transfer to the Off-Highway Vehicle Trust Fund pursuant to paragraph (1), and transfer that amount to the General Fund.
(b)The amount transferred to the Off-Highway Vehicle Trust Fund pursuant to paragraph (1) of subdivision (a), as a percentage of the Motor Vehicle Fuel Account, shall be equal to the percentage transferred in the 200607 fiscal year. Every five years, starting in the 201314 fiscal year, the percentage transferred may be adjusted by the Department of Transportation in cooperation with the Department of Parks and Recreation and the Department of Motor Vehicles. Adjustments shall be based on, but not limited to, the changes in the following factors since the 200607 fiscal year or the last adjustment, whichever is more recent:
(1)The number of vehicles registered as off-highway motor vehicles as required by Division 16.5 (commencing with Section 38000) of the Vehicle Code.
(2)The number of registered street-legal vehicles that are anticipated to be used off highway, including four-wheel drive vehicles, all-wheel drive vehicles, and dual-sport motorcycles.
(3)Attendance at the state vehicular recreation areas.
(4)Off-highway recreation use on federal lands as indicated by the United States Forest Services National Visitor Use Monitoring and the United States Bureau of Land Managements Recreation Management Information System.
(c)It is the intent of the Legislature that transfers from the Motor Vehicle Fuel Account to the Off-Highway Vehicle Trust Fund should reflect the full range of motorized vehicle use off highway for both motorized recreation and motorized off-road access to other recreation opportunities. Therefore, the Legislature finds that the fuel tax baseline established in subdivision (b), attributable to off-highway estimates of use as of the 200607 fiscal year, accounts for the three categories of vehicles that have been found over the years to be users of fuel for off-highway motorized recreation or motorized access to nonmotorized recreational pursuits. These three categories are registered off-highway motorized vehicles, registered street-legal motorized vehicles used off highway, and unregistered off-highway motorized vehicles.
(d)It is the intent of the Legislature that the off-highway motor vehicle recreational use to be determined by the Department of Transportation pursuant to paragraph (2) of subdivision (b) be that usage by vehicles subject to registration under Division 3 (commencing with Section 4000) of the Vehicle Code, for recreation or the pursuit of recreation on surfaces where the use of vehicles registered under Division 16.5 (commencing with Section 38000) of the Vehicle Code may occur.
(e)In the 201415 fiscal year, the Department of Transportation, in consultation with the Department of Parks and Recreation and the Department of Motor Vehicles, shall undertake a study to determine the appropriate adjustment to the amount transferred pursuant to subdivision (b) and to update the estimate of the amount attributable to taxes imposed upon distributions of motor vehicle fuel used in the operation of motor vehicles off highway and for which a refund has not been claimed. The department shall provide a copy of this study to the Legislature no later than January 1, 2016.
(a)(1)Subject to Section 8352.1, and except as otherwise provided in paragraph (2), paragraphs (2) and (3), on the first day of every month, there shall be transferred from moneys deposited to the credit of the Motor Vehicle Fuel Account to the Off-Highway Vehicle Trust Fund created by Section 38225 of the Vehicle Code an amount attributable to taxes imposed upon distributions of motor vehicle fuel used in the operation of motor vehicles off highway and for which a refund has not been claimed. Transfers made pursuant to this section shall be made prior to transfers pursuant to Section 8352.2.
(2)Commencing July 1, 2012, the revenues attributable to the taxes imposed pursuant to subdivision (b) of Section 7360 and Section 7361.1 and otherwise to be deposited in the Off-Highway Vehicle Trust Fund pursuant to paragraph (1) shall instead be transferred to the General Fund. The revenues attributable to the taxes imposed pursuant to subdivision (b) of Section 7360 and Section 7361.1 that were deposited in the Off-Highway Vehicle Trust Fund in the 201011 and 201112 fiscal years shall be transferred to the General Fund.
(3)Until June 30, 2017, the Controller shall withhold eight hundred thirty-three thousand dollars ($833,000) from the monthly transfer to the Off-Highway Vehicle Trust Fund pursuant to paragraph (1), and transfer that amount to the General Fund.
(b)The amount transferred to the Off-Highway Vehicle Trust Fund pursuant to paragraph (1) of subdivision (a), as a percentage of the Motor Vehicle Fuel Account, shall be equal to the percentage transferred in the 200607 fiscal year. Every five years, starting in the 201314 fiscal year, the percentage transferred may be adjusted by the Department of Transportation in cooperation with the Department of Parks and Recreation and the Department of Motor Vehicles. Adjustments shall be based on, but not limited to, the changes in the following factors since the 200607 fiscal year or the last adjustment, whichever is more recent:
(1)The number of vehicles registered as off-highway motor vehicles as required by Division 16.5 (commencing with Section 38000) of the Vehicle Code.
(2)The number of registered street-legal vehicles that are anticipated to be used off highway, including four-wheel drive vehicles, all-wheel drive vehicles, and dual-sport motorcycles.
(3)Attendance at the state vehicular recreation areas.
(4)Off-highway recreation use on federal lands as indicated by the United States Forest Services National Visitor Use Monitoring and the United States Bureau of Land Managements Recreation Management Information System.
(c)It is the intent of the Legislature that transfers from the Motor Vehicle Fuel Account to the Off-Highway Vehicle Trust Fund should reflect the full range of motorized vehicle use off highway for both motorized recreation and motorized off-road access to other recreation opportunities. Therefore, the Legislature finds that the fuel tax baseline established in subdivision (b), attributable to off-highway estimates of use as of the 200607 fiscal year, accounts for the three categories of vehicles that have been found over the years to be users of fuel for off-highway motorized recreation or motorized access to nonmotorized recreational pursuits. These three categories are registered off-highway motorized vehicles, registered street-legal motorized vehicles used off highway, and unregistered off-highway motorized vehicles.
(d)It is the intent of the Legislature that the off-highway motor vehicle recreational use to be determined by the Department of Transportation pursuant to paragraph (2) of subdivision (b) be that usage by vehicles subject to registration under Division 3 (commencing with Section 4000) of the Vehicle Code, for recreation or the pursuit of recreation on surfaces where the use of vehicles registered under Division 16.5 (commencing with Section 38000) of the Vehicle Code may occur.
(e)In the 201415 fiscal year, the Department of Transportation, in consultation with the Department of Parks and Recreation and the Department of Motor Vehicles, shall undertake a study to determine the appropriate adjustment to the amount transferred pursuant to subdivision (b) and to update the estimate of the amount attributable to taxes imposed upon distributions of motor vehicle fuel used in the operation of motor vehicles off highway and for which a refund has not been claimed. The department shall provide a copy of this study to the Legislature no later than January 1, 2016.
(a)(1)Subject to Section 8352.1, and except as otherwise provided in paragraphs (2) and (3), paragraph (2), on the first day of every month, there shall be transferred from moneys deposited to the credit of the Motor Vehicle Fuel Account to the Off-Highway Vehicle Trust Fund created by Section 38225 of the Vehicle Code an amount attributable to taxes imposed upon distributions of motor vehicle fuel used in the operation of motor vehicles off highway and for which a refund has not been claimed. Transfers made pursuant to this section shall be made prior to transfers pursuant to Section 8352.2.
(2)Commencing July 1, 2012, the revenues attributable to the taxes imposed pursuant to subdivision (b) of Section 7360 and Section 7361.1 and otherwise to be deposited in the Off-Highway Vehicle Trust Fund pursuant to paragraph (1) shall instead be transferred to the General Fund. The revenues attributable to the taxes imposed pursuant to subdivision (b) of Section 7360 and Section 7361.1 that were deposited in the Off-Highway Vehicle Trust Fund in the 201011 and 201112 fiscal years shall be transferred to the General Fund.
(3)The Controller shall withhold eight hundred thirty-three thousand dollars ($833,000) from the monthly transfer to the Off-Highway Vehicle Trust Fund pursuant to paragraph (1), and transfer that amount to the General Fund.
(b)The amount transferred to the Off-Highway Vehicle Trust Fund pursuant to paragraph (1) of subdivision (a), as a percentage of the Motor Vehicle Fuel Account, shall be equal to the percentage transferred in the 200607 fiscal year. Every five years, starting in the 201314 fiscal year, the percentage transferred may be adjusted by the Department of Transportation in cooperation with the Department of Parks and Recreation and the Department of Motor Vehicles. Adjustments shall be based on, but not limited to, the changes in the following factors since the 200607 fiscal year or the last adjustment, whichever is more recent:
(1)The number of vehicles registered as off-highway motor vehicles as required by Division 16.5 (commencing with Section 38000) of the Vehicle Code.
(2)The number of registered street-legal vehicles that are anticipated to be used off highway, including four-wheel drive vehicles, all-wheel drive vehicles, and dual-sport motorcycles.
(3)Attendance at the state vehicular recreation areas.
(4)Off-highway recreation use on federal lands as indicated by the United States Forest Services National Visitor Use Monitoring and the United States Bureau of Land Managements Recreation Management Information System.
(c)It is the intent of the Legislature that transfers from the Motor Vehicle Fuel Account to the Off-Highway Vehicle Trust Fund should reflect the full range of motorized vehicle use off highway for both motorized recreation and motorized off-road access to other recreation opportunities. Therefore, the Legislature finds that the fuel tax baseline established in subdivision (b), attributable to off-highway estimates of use as of the 200607 fiscal year, accounts for the three categories of vehicles that have been found over the years to be users of fuel for off-highway motorized recreation or motorized access to nonmotorized recreational pursuits. These three categories are registered off-highway motorized vehicles, registered street-legal motorized vehicles used off highway, and unregistered off-highway motorized vehicles.
(d)It is the intent of the Legislature that the off-highway motor vehicle recreational use to be determined by the Department of Transportation pursuant to paragraph (2) of subdivision (b) be that usage by vehicles subject to registration under Division 3 (commencing with Section 4000) of the Vehicle Code, for recreation or the pursuit of recreation on surfaces where the use of vehicles registered under Division 16.5 (commencing with Section 38000) of the Vehicle Code may occur.
(e)In the 201415 fiscal year, the Department of Transportation, in consultation with the Department of Parks and Recreation and the Department of Motor Vehicles, shall undertake a study to determine the appropriate adjustment to the amount transferred pursuant to subdivision (b) and to update the estimate of the amount attributable to taxes imposed upon distributions of motor vehicle fuel used in the operation of motor vehicles off highway and for which a refund has not been claimed. The department shall provide a copy of this study to the Legislature no later than January 1, 2016.
SECTION 1.Section 17010 of the Revenue and Taxation Code is amended to read:17010.Taxable year means either the calendar year or the fiscal year upon the basis of which the taxable income is computed under this part. If no fiscal year has been established, taxable year means the calendar year.
Taxable year means, in the case of a return made for a fractional part of a year under this part or under regulations prescribed by the Franchise Tax Board, the period for which the return is made.
Taxable year means either the calendar year or the fiscal year upon the basis of which the taxable income is computed under this part. If no fiscal year has been established, taxable year means the calendar year.
Taxable year means, in the case of a return made for a fractional part of a year under this part or under regulations prescribed by the Franchise Tax Board, the period for which the return is made.
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Date
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Status
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| Feb 18, 2016 | Read first time. To print. |
| Feb 19, 2016 | From printer. May be heard in committee March 20. |
| Mar 17, 2016 | Referred to Com. on TRANS. |
| Mar 18, 2016 | From committee chair, with author's amendments: Amend, and re-refer to Com. on TRANS. Read second time and amended. |
| Mar 28, 2016 | Re-referred to Com. on TRANS. |
| Apr 19, 2016 | From committee: Do pass and re-refer to Com. on APPR. with recommendation: To Consent Calendar. (Ayes 15. Noes 0.) (April 18). Re-referred to Com. on APPR. |
| May 4, 2016 | In committee: Set, first hearing. Referred to APPR. suspense file. |
| May 27, 2016 | From committee: Amend, and do pass as amended. (Ayes 20. Noes 0.) (May 27). |
| May 27, 2016 | Read second time and amended. Ordered returned to second reading. |
| May 31, 2016 | Read second time. Ordered to third reading. |
| Jun 1, 2016 | Read third time. Passed. Ordered to the Senate. |
| Jun 1, 2016 | Read third time. Passed. Ordered to the Senate. (Ayes 80. Noes 0. Page 5102.) |
| Jun 1, 2016 | Read third time. Passed. Ordered to the Senate. (Ayes 80. Noes 0.) |
| Jun 2, 2016 | In Senate. Read first time. To Com. on RLS. for assignment. |
| Jun 9, 2016 | Referred to Com. on T. & H. |
| Jun 20, 2016 | From committee chair, with author's amendments: Amend, and re-refer to committee. Read second time, amended, and re-referred to Com. on T. & H. |
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Date
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Description
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Location
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Votes
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| Jun 1, 2016 | AB 2175 JONES Assembly Third Reading | Assembly Floor |
Passed |
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| May 27, 2016 | Do pass as amended. | Assembly Standing Committee on Appropriations |
Passed |
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| Apr 18, 2016 | Do pass and be re-referred to the Committee on [Appropriations] with recommendation: To Consent Calendar | Assembly Standing Committee on Transportation |
Passed |
This list shows positions taken on this bill by organizations on the date displayed, which is linked to the original source.
Positions by individuals are not included.
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Organization
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Position
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Date
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|---|---|---|
| American Sand Association | ** Support | Jun 1, 2016 |
| California Off Road Vehicle Association | ** Support | Jun 1, 2016 |
| Imperial County Board of Supervisors | ** Support | Jun 1, 2016 |
| Motorcycle Industry Council | ** Support | Jun 1, 2016 |
| Recreational Off-Highway Vehicle Association | ** Support | Jun 1, 2016 |
| San Diego Off-Road Coalition | ** Support | Jun 1, 2016 |
| Specialty Vehicle Institute of America | ** Support | Jun 1, 2016 |
ASSEMBLY THIRD READING
ATR Bill Id:
Author:(Jones)
As Amended Ver:May 27, 2016
Majority vote
Committee | Votes | Ayes | Noes |
Transportation | 15-0 | Frazier, Linder, Baker, Bloom, Brown, Chu, Daly, Dodd, Gomez, Kim, Mathis, Medina, Melendez, Nazarian, O'Donnell | |
Appropriations | 20-0 | Gonzalez, Bigelow, Bloom, Bonilla, Bonta, Calderon, Chang, Daly, Eggman, Gallagher, Eduardo Garcia, Roger Hernández, Holden, Jones, Obernolte, Quirk, Santiago, Wagner, Weber, Wood |
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SUMMARY: After June 30, 2017, eliminates the transfer of $10 million per year from the Off-Highway Vehicle (OHV) Trust Fund to the General Fund.
EXISTING LAW:
- Establishes the OHV trust fund administered by the California Department of Parks and Recreation (Parks) to fund the maintenance, operations and enforcement of State Vehicular Recreation Areas (SVRA) and other state and federal lands allowable for OHV use.
- Provides for the imposition and collection of OHV registration fees and SVRA entrance fees to be deposited in the OHV trust fund.
- Provides for the transfers of fuels taxes attractable to OHV and off-highway motor vehicle activity from the Motor Vehicle Fuel Account to the OHV trust fund.
- Requires the Controller to withhold $833,000 per month from the Motor Vehicles Fuel Account transfer to the OHV trust fund and transfer that amount to the General Fund.
FISCAL EFFECT: According to the Assembly Appropriations Committee, ongoing $10 million loss of General Fund revenue and corresponding increase in OHV Trust Fund revenues, commencing in 2017-18.
COMMENTS: As part of the 2011-12 budget act, $833,000 per month, or $10 million annually, was redirected from the OHV Trust Fund to the state General Fund as part of numerous loans and diversions from various special funds to help balance the state's budget. According to the author, since that time, the OHV trust fund has lost $50 million that would have otherwise been used to maintain critical infrastructure and services to the OHV recreation community that is responsible for generating user-fee revenues. Further, he states that this bill will stop the inappropriate diversion of transportation-generated revenues to unrelated purposes.
The OHV program was created in 1971 and is managed by Department of Parks and Recreation and overseen by California Off-Highway Motor Vehicle Recreation Commission. The program is funded by a combination of proceeds derived from the $52 biennial registration fee on OHVs, commonly referred to as the "green sticker" program; taxes on motor vehicle fuels, both those consumed by OHVs and those attributable to vehicle use off of the public highways; and entrance fees collected at SVRAs. Since the passage of SB 742 (Steinberg), Chapter 541, Statutes of 2007, the amount of motor fuels transferred to the OHV trust fund are based on the percentage of fuel taxes transferred in 2007. Prior to 2007, the amount of funds attributable to OHV use was determined based on statewide studies that estimated the total gallons of gasoline burned in the course of OHV recreation. In fact, as part of the 2014-15 budget, the Department of Transportation, Parks and the Department of Motor Vehicles (DMV) are required to do a study to determine the appropriate level of funds to transfer to the OHV trust fund based upon estimated fuel use by off highway vehicles and activities. The study is not yet complete.
Funding from the OHV trust fund is used for grants to local, state and federal entities, Native American tribes, educational institutions and non-profit organizations. The grants are split into function areas with 50% for operations and maintenance of trails and facilities, 25% for restoration or repair to habitat damaged by OHV use, 20% for law enforcement, and 5% for education and safety programs.
In writing in support of this bill, the California Off-Road Vehicle Association (CORVA) notes that as a result of diversion of funds from the OHV trust fund, the OHV program is now unable to fully fund their program and many rural local government OHV grants are only getting funded at a fraction of the needs to provide law enforcement, safety, trail maintenance, and environmental restoration on lands within their jurisdictions. The American Sand Association adds that the loss of $10 million each year is creating serious delays in providing badly needed maintenance to OHV trails and areas throughout California and will increase the costs of finally dealing with these maintenance issues.
To help solve the budget crisis of the Great Recession, numerous loans and diversions have been made from the OHV trust fund to help support the state parks budget and the state General Fund. The General Fund in no longer in crisis. Many of these loans are in the process on being repaid, including in the Governor's 2016-17 budget proposal. This bill is consistent with these actions.
Analysis Prepared by: Melissa White / TRANS. / (916) 319-2093 FN: 0003177
Date of Hearing: May 4, 2016
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Lorena Gonzalez, Chair
ABPCA Bill Id:AB 2175
Author:(Jones) – As Amended Ver:March 18, 2016
Policy Committee: | Transportation | Vote: | 15 - 0 |
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Urgency: No State Mandated Local Program: No Reimbursable: No
SUMMARY:
This bill eliminates the statutory transfer of $10 million per year from the Off-HighwayVehicle (OHV) Trust Fund to the General Fund.
FISCAL EFFECT:
Ongoing $10 million loss of General Fund revenue and corresponding increase in OHV Trust Fund revenues.
COMMENTS:
- Background and Purpose. In 2011-12, to help address the state budget crisis, support from the General Fund for the non-OHV state park system was reduced by $11million, annualized to $22 million in the following fiscal year. To achieve a proportionate level of General Fund savings related to OHV state parks, a 2011-12 budget trailer bill include language transferring $10 million annually ($833,000 per month) from the OHV Trust Fund to the General Fund.
The author argues that, since enactment of the above diversion, the OHV program has lost $50 million, and contends that, with the General Fund no longer in crisis, it is now time to reverse this diversion of OHV funding.
- OHV Trust Fund Condition. In 2016-17, and absent this bill, the OHV Fund, as proposed by Governor, will receive $112 million in repaid General Fund loans. Total revenues will be $240 million, an increase of $60 million over the current year amount. Spending from the fund is estimated at $90 million, leaving a $150 million balance.
Analysis Prepared by: Chuck Nicol / APPR. / (916) 319-2081
Date of Hearing: April 18, 2016
ASSEMBLY COMMITTEE ON TRANSPORTATION
Jim Frazier, Chair
ABPCA Bill Id:AB 2175 (
Author:Jones) – As Amended Ver:March 18, 2016
SUBJECT: Fuel taxes: Off-Highway Vehicle Trust Fund
SUMMARY: Eliminates the transfer of $10 million per year from the Off-Highway Vehicle (OHV) Trust Fund to the General Fund.
EXISTING LAW:
- Establishes the OHV trust fund administered by the California Department of Parks and Recreation (Parks) to fund the maintenance, operations and enforcement of State Vehicular Recreation Areas (SVRA) and other state and federal lands allowable for OHV use.
- Provides for the imposition and collection of OHV registration fees and SVRA entrance fees to be deposited in the OHV trust fund.
- Provides for the transfers of fuels taxes attractable to OHV and off-highway motor vehicle activity from the Motor Vehicle Fuel Account to the OHV trust fund.
- Requires the Controller to withhold $833,000 per month from the Motor Vehicles Fuel Account transfer to the OHV trust fund and transfer that amount to the General Fund.
FISCAL EFFECT: Unknown
COMMENTS: As part of the 2011-12 budget act, $833,000 per month, or $10 million annually, was redirected from the OHV Trust Fund to the state General Fund as part of numerous loans and diversions from various special funds to help balance the state’s budget. According to the author, since that time, the OHV trust fund has lost $50 million that would have otherwise been used to maintain critical infrastructure and services to the OHV recreation community that is responsible for generating user-fee revenues. Further, he states that AB 2175 will stop the inappropriate diversion of transportation-generated revenues to unrelated purposes.
The OHV program was created in 1971 and is managed by Department of Parks and Recreation and overseen by California Off-Highway Motor Vehicle Recreation Commission. The program is funded by a combination of proceeds derived from the $52 biennial registration fee on OHVs, commonly referred to as the “green sticker” program; taxes on motor vehicle fuels, both those consumed by OHVs and those attributable to vehicle use off of the public highways; and entrance fees collected at SVRAs. Since the passage of SB 742 (Steinberg), Chapter 541, Statutes of 2007, the amount of motor fuels transferred to the OHV trust fund are based on the percentage of fuel taxes transferred in 2007. Prior to 2007, the amount of funds attributable to OHV use was determined based on statewide studies that estimated the total gallons of gasoline burned in the course of OHV recreation. In fact, as part of the 2014-15 budget, the Department of Transportation, Parks and the Department of Motor Vehicles (DMV) are required to do a study to determine the appropriate level of funds to transfer to the OHV trust fund based upon estimated fuel use by off highway vehicles and activities. The study is not yet complete.
Funding from the OHV trust fund is used for grants to local, state and federal entities, Native American tribes, educational institutions and non-profit organizations. The grants are split into function areas with 50% for operations and maintenance of trails and facilities, 25% for restoration or repair to habitat damaged by OHV use, 20% for law enforcement, and 5% for education and safety programs.
In writing in support of AB 2175, the California Off-Road Vehicle Association (CORVA) notes that as a result of diversion of funds from the OHV trust fund, the OHV program is now unable to fully fund their program and many rural local government OHV grants are only getting funded at a fraction of the needs to provide law enforcement, safety, trail maintenance, and environmental restoration on lands within their jurisdictions. The American Sand Association adds that the loss of $10 million each year is creating serious delays in providing badly needed maintenance to OHV trails and areas throughout California and will increase the costs of finally dealing with these maintenance issues.
To help solve the budget crisis of the Great Recession, numerous loans and diversions have been made from the OHV trust fund to help support the state parks budget and the state General Fund. The General Fund in no longer in crisis. Many of these loans are in the process on being repaid, including in the Governor’s 2016-17 budget proposal. AB 2175 is consistent with these actions.
Previous legislation: SB 853 (Committee on Budget and Fiscal Review), Chapter 27, Statutes of 2014), requires the Department of Transportation, in consultation with Parks and DMV, to do a study to determine the appropriate level of funds transferred to the OHV trust fund based on estimated taxes attributable to OHV use and activities. The study is due to the Legislature no later than January 1, 2016.
SB 742 (Steinberg), Chapter 541, Statutes of 2007, reauthorized the OHV program, created the OHV Recreation Commission and changed the baseline for future funding for OHVs.
REGISTERED SUPPORT / OPPOSITION:
Support
American Sand Association (Sponsor)
California Off Road Vehicle Association (Sponsor)
San Diego Off-Road Coalition (Sponsor)
Imperial County Board of Supervisors
Motorcycle Industry Council
Specialty Vehicle Institute of America
Recreational Off-Highway Vehicle Association
Opposition
None on file
Analysis Prepared by: Melissa White / TRANS. / (916) 319-2093
Bill Author
Bill Co-Author(s):
