Fiscal impact reports (FIRs) are prepared by the Legislative Finance Committee (LFC) for standing finance

committees of the NM Legislature. The LFC does not assume responsibility for the accuracy of these reports

if they are used for other purposes.

Current FIRs (in HTML & Adobe PDF formats) are a vailable on the NM Legislative Website (legis.state.nm.us).

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attachments may be obtained from the LFC in Suite 101 of the State Capitol Building North.

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

SPONSOR Gonzales

DATE TYPED 3/18/05

HB

460/aHTC/aHJC

/aHAFC/aSFC

SHORT TITLE Off-Highway Vehicle Safety & Fee Requirements

SB

ANALYST Moser

REVENUE

Estimated Revenue

Subsequent

Years Impact

Recurring

or Non-Rec

Fund

Affected

FY05

FY06

0 +

0 +

$90 +

Recurring

State Road Fund (2

yr. registration)

0 +

0 +

$30 +

Recurring Local Governments (2

yr. registration)

$50 +

$115 +

$166 +

Recurring Motor Vehicle Divi-

sion (registration)

*

*

*

Recurring Department of Game

and Fish

$ 300 ++

$690 ++

$995 ++

Recurring

Trail Safety Fund

(user permit fee)

$10 ++

$23 ++

$33 ++

Recurring NM Clean and Beau-

tiful Program

(Parenthesis ( ) Indicate Revenue Decreases)

The “+” indicates additional revenue from nonresident annual registration fees.

The “++” indicates additional revenue from nonresident annual user permit fees and nonresident 90-day permit fees.

* Department of Game and Fish – the number of transactions that would be conducted by the Department of Game

and Fish is unknown – also see Technical Issues.

Assumptions: 60,000 registered vehicles, plus some unknown number of nonresident permits (+, ++).

The fiscal impact does not include any increased compliance regarding off-highway vehicle registrations. Pre-

sumable a very large number of off-road vehicles are not currently registered, and the fiscal impact estimate

assumes full compliance currently. Therefore, the positive fiscal impact to the State Road Fund and local

governments is very much understated. Similarly, if very few three-year registrations are currently in place,

the out-year fiscal impacts would manifest more quickly.

The revenue illustration excludes some minor amount of dealer demonstration certificate fees.

Note: Since the ATV registration is changed from a 3 year period to a 2 year period, there is a positive fiscal impact

on the State Road Fund and Local Governments beginning in the 3

rd

year after the effective date. The bill includes

no transition provision for existing 3-year registrations, so the full revenue impact will not be realized until FY2009

(when 3-year registrations obtained at the end of calendar year 2005 are due for renewal).

Duplicates

SB-252

House Bill 460/aHTC/aHJC/aHAFC/aSFC -- Page 2

SOURCES OF INFORMATION

LFC Files

Responses Received From

Department of Transportation (DOT)

Corrections Department (CD)

Department of Finance and Administration (DFA)

FOR THE LEGISLATIVE HEALTH AND HUMAN SERVICES COMMITTEE

SUMMARY

Synopsis of SFC Amendment

The Senate Finance Committee Amendment exempts individuals who operate off-highway mo-

tor vehicles on privately held lands from the provisions of the Off-Highway Motor Vehicle Act.

The amendment additionally changes the authority of the off-highway motor vehicle safety board

from making determination of locations of off-highway motor vehicle parks, facilities and trail

locations and restoration projects to that of making recommendation “…to the state, county,

tribal or local governing body or private entity that owns or administers the land upon which the

tracks or trails are located.”

Synopsis of HAFC Amendment

The House Appropriation and Finance Committee Amendment increases the size of the Off

Highway Safety Board from 15 members to 17 members with the new members being one from

the US bureau of land management and one from the US forest service. Both appointments

would be made by the governor.

Synopsis of HTC Amendment

House Transportation Committee Amendment restores present law language that exempts from

regulation vehicles owned by non-residents and brought into the state only for competition. The

only difference from present law, after the amendment, is that the current limit on the exemption

to 15-day period is stricken. Permits 15 year olds with an instructional permit or provisional li-

cense to operate an off-road vehicle without supervision. Competition vehicles are exempted

from noise regulation. ATV use is allowed on state lands where permitted by the Secretary of

Energy, Minerals and Natural Resources. Other amendments are clean-up and tracking lan-

guage.

HTC and HJC Amendments have addressed known technical issues identified by the NMDOT.

Synopsis of Original Bill

House Bill 460 revises sections of the Off-Highway Motor Vehicle Act providing a number of

new safety and safety training provisions, and imposing a new off-highway user fee directed to

the new Trail Safety Fund. The current three-year off-highway vehicle registration fee amount is

increased from the current $15 to be a two-year registration for $17, with portions of the fee di-

rected to the Motor Vehicle Division to offset additional costs associated with the provisions of

the bill.

House Bill 460/aHTC/aHJC/aHAFC/aSFC -- Page 3

This review addresses the fiscal impact aspects of the bill, and does not address the safety issues

or the off-highway trail development aspects of the bill.

Significant Issues

The fiscal impact shown on page 1 does not include any increased compliance regarding off-

highway vehicle registrations. Presumably a very large number of off-road vehicles are not cur-

rently registered, and the fiscal impact estimate assumes full compliance currently. Therefore,

the positive fiscal impact to the State Road Fund and local governments is very much under-

stated.

PERFORMANCE IMPLICATIONS

The Department of Finance and Administration feels that this bill is convoluted and performance

based budgeting will be difficult to administer.

FISCAL IMPLICATIONS

The NMDOT makes the following assumptions: 60,000 registered vehicles, plus some unknown

number of nonresident permits (+, ++).

The fiscal impact does not include any increased compliance regarding off-highway vehicle reg-

istrations. Presumably a very large number of off-road vehicles are not currently registered, and

the fiscal impact estimate assumes full compliance currently. Therefore, the positive fiscal im-

pact to the State Road Fund and local governments is very much understated. Similarly, if very

few three-year registrations are currently in place, the out-year fiscal impacts would manifest

more quickly.

The revenue illustration excludes some minor amount of dealer demonstration certificate fees.

Note: Since the ATV registration is changed from a 3 year period to a 2 year period, there is a

positive fiscal impact on the State Road Fund and Local Governments beginning in the 3

rd

year

after the effective date. The bill includes no transition provision for existing 3-year registrations,

so the full revenue impact will not be realized until FY2009 (when 3-year registrations obtained

at the end of calendar year 2005 are due for renewal).

DFA indicates that an indeterminate appropriation impact will be seen and revenues are esti-

mated as follows based upon assumptions in FY06 of 1000 new registrations in state and 200 out

of state users:

Registration fees - $20.4

User fees - $36.0

Clean and Beautiful Program $1.2

The registration fees shall be distributed as follows:

Division $6.0

Motor Vehicle Suspense Fund - $14.4

The special user fee shall be distributed as follows:

Game and Fish Game Protection Fund - $7.00 out of each user fee collected by Game and Fish.

Remainder of fee if collected by Game and Fish, or all of fee if collected by another agency, to

Trail Safety Fund

House Bill 460/aHTC/aHJC/aHAFC/aSFC -- Page 4

There are approximately 40,000 ATV's currently registered (from last years FIR, HB 257). If all

these vehicles require re-registration in FY07 the fiscal impact would be:

Registration fees - $680.0

User fees - $1,200.0

Clean and Beautiful Program $40.0

The registration fees shall be distributed as follows:

Division $200.0

Motor Vehicle Suspense Fund - $480.0

The special user fee would be distributed as follows:

Game and Fish Game Protection Fund - $7.00 out of each user fee collected by Game and Fish.

Remainder of fee if collected by Game and Fish, or all of fee if collected by another agency, to

Trail Safety Fund

ADMINISTRATIVE IMPLICATIONS

DFA indicates that the fees may be collected by the Department of Tourism, in conjunction with

Department of Game and Fish for both residents and non-residents. How a field officer will

check out of state registration is a concern. How Department of Tourism will implement a sys-

tem for charging user fees is not addressed in the bill.

CONFLICT, DUPLICATION, COMPANIONSHIP, RELATIONSHIP

SB-252 is a duplicate

TECHNICAL ISSUES

The NMDOT offers the following:

•

On page 13, line 24 the term “driver’s license” should be replaced with the terms “in-

structional permit or provisional license” applicable to persons age 15 through 17 years.

•

Section 4, Subsection F presents a technical conflict with other provisions in Section 4,

Subsections A through E of the bill. Section 4, Subsection (F) states: “Notwithstanding

the provisions of Subsections A through E of this section, seven dollars ($7.00) shall be

distributed to the department of game and fish for each fee that the department of game

and fish collects.” The problem here is that Subsections A through E distribute all of the

fees in very specific amounts. The “notwithstanding” provision leaves the Motor Ve-

hicle Division (MVD) in the role of deciding a substantive provision of law with no

guidance from the Legislature. Subsections A through E generally direct $5 of the reg-

istration fee to MVD, $12 of the registration fee to the Section 66-6-23 distribution (or to

the Trail Safety Fund in the case of a 90 day nonresident permit), the off-highway user

permit fee to the Trail Safety Fund, and the $1 NM Clean & Beautiful fee to the Tourism

Department. If $7.00 is directed to the Department of Game and Fish, the MVD must

decide what entities will receive less revenue than is specified in the other distribution

sections, and the bill suggests no guidance for this decision. This particular provision

was amended into last year’s bill in the Senate Finance Committee late in the session, and

House Bill 460/aHTC/aHJC/aHAFC/aSFC -- Page 5

there was no time to repair this conflict before the legislature adjourned.

When the Department of Game and Fish conducts the transaction, there may be less need

to reimburse MVD their $5 portion of the fee. The remaining $2, or possibly the entire

$7, necessary to cover the Game and Fish reimbursement would have to come either from

the Section 66-6-23 distribution to the State Road Fund and local governments (2 year

permits), or from the distribution to the Trail Safety Fund (90 day nonresident permits).

It seems likely MVD would choose to keep its $5 share and take the $7 Game and Fish

share out of the other recipients’ portion.

•

The “notwithstanding” provision of Section 4, Subsection F may also require additional

clarification. The distribution to the Game Protection Fund is specified to be “$7 for

each fee collected”. Presumably the Game and Fish Department might: 1) register a

resident’s vehicle involving 2 fees; 2) register a nonresident’s vehicle for a two-year pe-

riod involving 2 fees; or, 3) issue a 90-day permit involving 1 fee. It is unclear whether

Game and Fish might receive $14 on some transactions that involve 2 fees, and $7 on

other transactions that involve only 1 fee.

OTHER SUBSTANTIVE ISSUES

DFA questions why the Department of Tourism would be responsible for charging a fee to tour-

ists is novel.

WHAT WILL BE THE CONSEQUENCES OF NOT ENACTING THIS BILL.

Off-highway vehicles will continue to be registered at $15.00. New safety regulations would not

go into effect.

EM/yr:lg:rs