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F I S C A L   I M P A C T   R E P O R T

 

 

SPONSOR:

Beam

 

DATE TYPED:

3/18/03

 

HB

584/aHTC/aHJC

 

SHORT TITLE:

Local Option Tax to Fund Rail System

 

SB

 

 

 

ANALYST:

Reynolds-Forte

 

REVENUE

 

Estimated Revenue

Subsequent

Years Impact

Recurring

or Non-Rec

Fund

Affected

FY03

FY04

 

 

 

 

Indeterminate (see fiscal implications below)

 

Recurring

Local Government Funds

 

Indeterminate

 

Recurring

MVD Adm Fee

(Parenthesis ( ) Indicate Revenue Decreases)

 

Relates to SB 34 and HB102, which creates the regional transit districts, and to SB420 which creates a local option vehicle gross receipts tax to finance regional transit systems and to SB666.

 

SOURCES OF INFORMATION

 

Responses Received From

Taxation and Revenue Department

Highway and Transportation Department

Energy Minerals and Natural Resources Department

 

SUMMARY

 

     Technical Issue Correction

 

House Bill 584/aHTC/aHJC appears to conflict with Section 66-6-25 NMSA 1978 which states that “No county or municipality shall require registration or charge fees for any vehicle subject to registration under the Motor Vehicle Code [66-1-1 NMSA 1978.”  Section 66-6-25 should probably be brought into the bill and amended as appropriate.

 

      Synopsis of HJC Amendment

 

The House Judiciary Committee amendment to HB 584 strikes the House Transportation Committee amendments.

 

The House Judiciary Committee amendment also adds language that requires an election/referendum prior to imposing the $25.00 vehicle registration fee for public transit and light rail. 

 

The amendment also changes the definition of the vehicles upon which the fee shall be imposed to “vehicles with a gross vehicle weight of less than twelve thousand pounds; provided that the fee shall not be imposed on motorcycles or manufactured homes or on vehicles that come within the definition of “vehicle” in the Leased Vehicle Gross Receipts Tax Act.” 

 

     Fiscal Implications of the HJC Amendment

 

The HJC amendment changes the definition of vehicles to include small trucks, which increases the number of vehicles which will pay the fee, and thus increases the revenues each county would collect.  The State Highway and Transportation Department has provided the following chart showing revenues by county related to imposition of the $25.00 fee based on the HJC amendment:

 

A $25 fee imposed county-wide would raise approximately the following amount of revenue per year (based on year 2001 registration statistics – amounts in thousands of dollars):

 

Bernalillo

        10,282.0

 

Harding

 25.0

 

Roosevelt

 367.0

Catron

             104.0

 

Hidalgo

 115.0

 

San Juan

 2,364.0

Chaves

          1,225.0

 

Lea

 1,214.0

 

San Miguel

 572.0

Cibola

             471.0

 

Lincoln

 507.0

 

Sandoval

 1,860.0

Colfax

             353.0

 

Los Alamos

 464.0

 

Santa Fe

 3,050.0

Curry

             931.0

 

Luna

 534.0

 

Sierra

 334.0

De Baca

              57.0

 

McKinley

 1,037.0

 

Socorro

 327.0

Dona Ana

          3,454.0

 

Mora

 115.0

 

Taos

 731.0

Eddy

          1,139.0

 

Otero

 1,217.0

 

Torrance

 363.0

Grant

             695.0

 

Quay

 240.0

 

Union

 101.0

Guadalupe

              99.0

 

Rio Arriba

 968.0

 

Valencia

 1,551.0

 

The total number of applicable vehicles registered in 2001 was 1,474,607 statewide.  The total revenue from a statewide imposition of the $25 fee would be about $36,865.0.

 

      Synopsis of HTC Amendment

 

The House Transportation Committee amendment changes the definition of the vehicles upon which the fee shall be imposed to vehicles with a gross vehicle weight of less than twelve thousand pounds, and provides that the fee shall not be imposed on motorcycles or manufactured homes.  This amendment now includes small trucks, used like a passenger vehicle, as subject to the fee.

       

     Fiscal Implications of the HTC Amendment

 

By changing the definition of vehicles to include small trucks, the number of vehicles that will pay the fee increases, and thus the revenues each county would collect increases.  The State Highway and Transportation Department has provided the following chart showing revenues by county related to imposition of the $25.00 fee based on the HTC amendment:

 

A $25 fee imposed county-wide would raise approximately the following amount of revenue per year (based on year 2001 registration statistics – amounts in thousands of dollars):

 

Bernalillo

        10,282.0

 

Harding

 25.0

 

Roosevelt

 367.0

Catron

             104.0

 

Hidalgo

 115.0

 

San Juan

 2,364.0

Chaves

          1,225.0

 

Lea

 1,214.0

 

San Miguel

 572.0

Cibola

             471.0

 

Lincoln

 507.0

 

Sandoval

 1,860.0

Colfax

             353.0

 

Los Alamos

 464.0

 

Santa Fe

 3,050.0

Curry

             931.0

 

Luna

 534.0

 

Sierra

 334.0

De Baca

              57.0

 

McKinley

 1,037.0

 

Socorro

 327.0

Dona Ana

          3,454.0

 

Mora

 115.0

 

Taos

 731.0

Eddy

          1,139.0

 

Otero

 1,217.0

 

Torrance

 363.0

Grant

             695.0

 

Quay

 240.0

 

Union

 101.0

Guadalupe

              99.0

 

Rio Arriba

 968.0

 

Valencia

 1,551.0

 

The total number of applicable vehicles registered in 2001 was 1,474,607 statewide.  The total revenue from a statewide imposition of the $25 fee would be about $36,865.0.

 

     Synopsis of Original Bill

 

HB584 creates a new local option motor vehicle registration fee of up to $25.00 per year on motor vehicles other than motorcycles, trucks, buses and tractors.  Revenue from the local option fee is to be used for management, planning, design, construction, acquisition, or operation of a public transit or light rail system.  The fee may be imposed by county or municipal governments, and is based on the address of the registered owner as recorded by the department.

 

A county-imposed fee would only apply to vehicles belonging to taxpayers residing in unincorporated areas of the county. However, a county may enter into a joint powers agreement with one or more municipalities authorizing countywide imposition and distribution of fees for joint transit purposes. The fee is to be collected by the Motor Vehicle Division (MVD).  MVD is authorized to retain a 3% administrative charge to defray the costs of collecting the local option fee. 

 

FISCAL IMPLICATIONS

 

HB584 allows counties and municipalities to impose a local option motor vehicle registration fee of up to $25.00 per year.  The amount of revenues which will be received from this fee will be dependent upon the number of communities who impose it and the amount of fee the community chooses to impose.  Each community has the choice to impose the flat $25.00 per vehicle fee or to base rates on a vehicle weight.

 

The Taxation and Revenue Department has provided the following chart which shows by county the value of a countywide $25.00 fee.

 

 

Countywide $25.00 Imposition of Local Option Registration Fee

Illustration at 2001 County Registration Levels

Bernalillo

$6,765,225
Harding

9,150
Roosevelt

202,575

Catron

32,700

Hidalgo

53,025

San Juan

1,190,025

Chaves

702,875

Lea

639,625

San Miguel

322,575

Cibola

249,200

Lincoln

287,025

Sandoval

1,142,900

Colfax

197,325

Los Alamos

306,875

Santa Fe

1,937,775

Curry

587,900

Luna

279,425

Sierra

164,775

De Baca

25,000

McKinley

530,050

Socorro

172,450

Dona Ana

2,103,675

Mora

54,575

Taos

421,850

Eddy

620,600

Otero

724,825

Torrance

174,975

Grant

345,000

Quay

115,000

Union

44,100

Guadalupe

45,575

Rio Arriba

537,675

Valencia

863,625

 

ADMINISTRATIVE IMPLICATIONS

 

The Taxation and Revenue Department states that their computer systems would need to be modified, and forms and instructions revised.  Motor vehicle personnel would need to be trained on the new provisions.  Verifying whether or not a vehicle owner’s address is within municipal boundaries may prove to be burdensome, especially for owners who reside just in or outside of municipal boundaries.

 

TECHNICAL ISSUES

 

This bill should further clarify the types of vehicles not subject to the local option registration fee.  Other motor vehicles subject to state registration fees that are not specifically addressed in this proposal include: farm trucks, taxis, off-road vehicles, and motor homes.

 

In Section 1, Subsection A (on page 2, line 6), the exclusion of “trucks” from vehicles on which the fee is imposed may not have been intended.  In the year 2000 there were 498,177 trucks registered in the state, many of which are privately owned pick-up trucks.  The Taxation and Revenue Department notes that excluding trucks from the local option fee may not be equitable treatment of two similar classes of vehicle.  Many trucks registered in the state are used like cars as passenger vehicles.

 

 

OTHER SUBSTANTIVE ISSUES

 

Energy Minerals and Natural Resources Department notes that this legislation would support the ECMD’s goal of promoting ride sharing and reducing dependence on foreign oil. Reducing the number of vehicles on New Mexico roads will promote traffic safety and energy efficiency.  An added benefit of this legislation is that ride sharing, with the possibility of using alternative fuels, would significantly reduce air pollution and provide support for alternative fuel infrastructure development.

 

PRF/yr:sb:njw