COMMITTEE ON LEGISLATIVE RESEARCH

OVERSIGHT DIVISION

FISCAL NOTE

L.R. No.:         3509-08

Bill No.:          Perfected SS for SCS for SB nos. 761 & 774

Subject:           Motor Vehicles; Transportation; Transportation Department; Licenses - Motor                         Vehicles; Motor Carriers; Buses; Law Enforcement Officers and Agencies;                         Revenue Department; Licenses - Driver's; Highway Patrol; Roads and Highways.

Type:              Original

Date:               March 27, 2008

Bill Summary:            This proposal modifies various laws relating to transportation and the regulation of motor vehicles.

FISCAL SUMMARY

Numbers within parentheses: ( ) indicate costs or losses.

This fiscal note contains 23 pages.

☒ Estimated Total Net Effect on All funds expected to exceed $100,000 savings or (cost).

☐ Estimated Net Effect on General Revenue Fund expected to exceed $100,000 (cost).

FISCAL ANALYSIS

ASSUMPTION

Officials at the Missouri Department of Transportation (MoDOT) assume the fiscal impact as follows:

Section 227.103 - Allows for the use of annual bid bonds in lieu of project specific bid bonds. This provision might result in some administrative savings to MoDOT, but the amount of such savings is speculative.

Section 302.305 - This section will have a positive impact on MoDOT because it requires drivers whose license are suspended or revoked to pay two additional license plate fees (in addition to the other registration fees these drivers must pay before being reinstated). The exact amount of this positive fiscal impact is unknown.

Sections 390.021 & 390.136 - The Unified Carrier Registration (UCR) Agreement was established in the federal UCR Act of 2005, as part of the Safe, Accountable, Flexible, and Efficient Transportation Equity Act: A Legacy for Users (SAFETEA-LU) (Public Law 109-59, August 10, 2005). The UCR Act repeals and replaces the federal Single State Registration System (SSRS). MoDOT assumes no fiscal impact as long as this legislation passes. If not the department will have a $2,342,000 loss in registration fees annually.

Oversight assumes that the state will comply with federal law and not lose the annual registration fee revenues.

Officials from the Department of Revenue (DOR) assume they will utilize existing resources to complete all testing, implementation and processing of proposed legislation that has changes affecting the bureau.

ASSUMPTION (continued)

DOR assumes the following legislative proposals do not impose an impact on their department: 227.103, 301.010, 301.010.52, 302.275.2, 302.321.2, 302.755.8,302.725.9, 302.775(1) a, b, c and d, 302.775(2),304.032, 304.070, 304.230, 304.232, 304.281.3, 307.100.2, 304.179.2(5), 385.400, 385.403, 385.406, 385.409, 385.412, 385.415, 385.418, 385.421, 385.424, 385.427, 385.430, 385.433 and 385.436, 390.021, 390.136.4, 390.071, 622.095,

Section 142.815;

The Tax department will need to:

•          This would create the need for form changes and minor Fuel Tax system changes.

•          This would also create the need for an informational bulletin to be sent to all the school districts in Missouri.

Section 301.010.52; - would require funding from the Motor Vehicle Commission Fund in the amount of $4,456 for dealer mailings. (envelopes, printing, postage)

Section 301.140.8; - Process transactions in TRIPS to generate a receipt to the customer and transmit the refund information to Sam II and MTAS as well as cancel the registration in GRS.

Section 306.535; -The Motor Vehicle department will need to revise procedures/forms to reflect the increase in outboard motor title penalties as well as issue a mailing to boat dealers. These costs will be minimal and will be absorbed.

Section 430.082; - the Motor Vehicle department will need to revise procedures/forms to reflect the mechanic lien title changes. This will be absorbed.

Due to the Statewide Information Technology Consolidation, DOR’s response to a proposal will now also reflect the cost estimates prepared by OA-IT for impact to the various systems. As a result, the impact shown may not be the same as previous fiscal notes submitted. In addition, if the legislation is Truly Agreed To and Finally Passed, the OA-IT costs shown will be requested through appropriations by OA-IT.

Office of Administration Information Technology (ITSD DOR) estimates that this legislation could be implemented utilizing 6 existing CIT III's for 6 month at a rate of $4,186. Office of Administration Information Technology (ITSD DOR) estimates the IT portion of this request can be accomplished within existing resources; however; if priorities shift, additional FTE/overtime would be needed to implement.

ASSUMPTION (continued)

DOR assumes section 142.815 exempts motor fuel used to operate buses for educational purposes. Exemptions result in less tax due; therefore, would result in reduced state revenues.

DOR assumes with section 301.140.8, currently, applicants receive a refund credit when they surrender their plates toward the purchase of another license plate. Under this proposal, applicants would receive a refund on the unused portion of their license plates even when they do not plan to purchase another registration. This would result in an unknown amount of refunds, potentially resulting in a significant loss to highway funds and cities and counties.

DOR assumes section 306.535 would result in a revenue INCREASE due to outboard motor title penalties (GR): If you assume the same number of applicants will be delinquent in titling outboard motors with the new increased penalties in place as the current penalties, there will be an increase in General Revenue funds in outboard motor title penalties in the amount of $430,544 in FY'09 and $516,653 each fiscal year thereafter.

DOR assumes a fiscal impact from sections 301.057 and 301.058. In FY '07 there were 1,717 vehicles registered with beyond local 78,000 + pound plates and 9,895 vehicles registered with local 72,000 + pound plates totaling $6,420,580 in revenue. It is unknown as to how many of these currently registered vehicles will move or can move to the new 80,001 pounds to 85,500 pounds BL/ and L category proposed by this legislation. It is also unknown as to how many future applicants will acquire this category therefore the overall revenue impact is unknown.

In response to a previous verison of this proposal, officials from the Department of Corrections (DOC) assumed the impact would be $0 or a minimal amount that could be absorbed within existing resources.

In response to a previous verison of this proposal, officials from the Department of Labor and Industrial Relations (DOLIR) assumed the proposed language in Section 302.275.2 RSMO, provides that an individual may be discharged for failure to notify his or her employer of a "citation for an intoxicated-related traffic offense." For the Division of Employment Security to deny unemployment benefits, the employee would need to be considered as discharged for misconduct connected with work so that it would disqualify the employee from receiving unemployment benefits.

It is assumed the number of individuals that would be affected by this provision would be small; however DOLIR has no way of determining the actual number of individuals who would be discharged under these circumstances and who would subsequently apply for unemployment compensation. DOLIR is assuming a small savings to the trust fund, the amount is unknown.

ASSUMPTION (continued)

In response to a previous verison of this proposal, officials from the Department of Elementary and Secondary Education (DESE) assumed there is no state cost to the foundation formula associated with this proposal. Should the new crimes and amendments to current law result in additional fines or penalties, DESE cannot know how much additional money might be collected by local governments or the DOR to distribute to schools. To the extent fine revenues exceed 2004-2005 collections, any increase in this money distributed to schools increases the deduction in the foundation formula the following year. Therefore the affected districts will see an equal decrease in the amount of funding received through the formula the following year; unless the affected districts are hold-harmless, in which case the districts will not see a decrease in the amount of funding received through the formula (any increase in fine money distributed to the hold-harmless districts will simply be additional money). An increase in the deduction (all other factors remaining constant) reduces the cost to the state of funding the formula.

In response to a previous verison of this proposal, officials from the Office of the Secretary of State (SOS) stated many bills considered by the General Assembly include provisions allowing or requiring agencies to submit rules and regulations to implement the act. The SOS is provided with core funding to handle a certain amount of normal activity resulting from each year’s legislative session. The fiscal impact for this fiscal note to the SOS for Administrative Rules is less than $2,500. The SOS recognizes that this is a small amount and does not expect that additional funding would be required to meet these costs. However, the SOS also recognizes that many such bills may be passed by the General Assembly in a given year and that collectively the costs may be in excess of what the office can sustain with the core budget. Therefore, the SOS reserves the right to request funding for the cost of supporting administrative rules requirements should the need arise based on a review of the finally approved bills signed by the governor.

Oversight assumes the SOS could absorb the costs of printing and distributing regulations related to this proposal. If multiple bills pass which require the printing and distribution of regulations at substantial costs, the SOS could request funding through the appropriation process.

In response to a previous verison of this proposal, officials at the Office of Prosecution Services assumed this would not have a significant direct fiscal impact on county prosecutors or the Office of Prosecution Services.

Officials at the Office of the State Treasurer, Department of Higher Education and the Department of Public Safety assume that there is no fiscal impact from this proposal to their respective agencies.

ASSUMPTION (continued)

Sections 260.392, 260.398, 260.399 & 260.750 - Nuclear Waste.

In response to a similar proposal from this year (SB 919), officials from the Department of Health and Senior Services (DHSS) assumed they would be responsible for inspection of radioactive material and waste shipments that are the subject of this proposal. DHSS will also be involved in the training of public health officials, state and local emergency responders, and others concerned with the transport of radioactive wastes. Finally, Section 192.510, RSMo., requires DHSS to be responsible for responding to all emergencies involving radioactive material. Under this proposal, DHSS would respond to such incidents.

Officials from the Department of Natural Resources (DNR) assume since Missouri does not currently require notification or collect a fee on any low-level radioactive waste shipments, the total number currently transported through the state is unknown. To attempt to predict how many of each type of shipment is reasonable to expect in the upcoming year DNR staff gathered shipment data from Illinois and Iowa, as well as the federal Department of Energy (DOE). Because Illinois does not collect a fee on low-level waste, no data was available on shipments that might enter Missouri from Illinois. Iowa does track low-level shipments due to their fee on this type of waste, but not all shipments go through Missouri prior to entering Iowa. Information from the DOE indicates that shipments vary based on several factors. Currently, DOE is cleaning up several former nuclear weapons manufacturing facilities. The ultimate disposal site of this waste depends on the outcome of DOE's bidding procedure. Once a disposal facility is selected, DOE selects a shipping company, and the shipping company selects the shipment route. DOE does provide information on an annual basis, with an estimate of what type and number of shipments may come through the various states.

The proposal would establish a fee of $125 for each truck or train transporting or shipping low-level radioactive waste through or within the state.

Using these sources of information, DNR estimates between 430 and 1,400 shipments can be anticipated in any given twelve-month period. The level of anticipated revenue as well as the level of effort needed to implement this proposal would be dependent on the number of shipments that came through Missouri. For purposes of this fiscal note, the department has

shown the income from fees and the associated costs as a range to more accurately reflect potential fiscal impact to the state.

ASSUMPTION (continued)

Option 1 - Income Low End of Range:

High-level: 2 shipments + 3 MURR no fee shipments                      $ 6,100

24 HRCQ shipments 285 miles each                                                  $ 94,200

400 low-level shipments annually                                                      $ 50,000

Estimated Annual Fee Income                                                           $150,300

Option 1 - Expenses:

Escorts: 2 high-level shipments (MURR direct pay)                         $ 2,960

Radiological inspections: 5 high-level shipments                             $ 1,400

Radiological inspections: 40 low-level shipments                            $ 11,200

DNR Fund Administration                                                                 $ 16,984

Environmental Monitoring                                                                 $ 13,500

Training & Notification of Local Responders                                    $ 30,962

Equipment & Supplies for State & Local Responders                       $ 73,294

Total Option 1 Expenses                                                                    $150,300

Option 2 - Income High End Range

High-level shipments: 2 + 4 MURR no fee shipments                       $ 6,100

45 HRCQ shipments 285 miles each                                                  $176,625

350 non-DOE Lo-level shipments                                                      $ 43,750

1000 DOE low-level shipments                                                         $125,000

Estimated Annual Fee Income                                                           $351,475

Option 2 - Expenses

Escorts: 2 high-level shipments (MURR direct pay)                         $ 2,960

Escorts: 45 HRCQ shipments                                                            $ 66,600

Radiological inspections: 6 high-level shipments                             $ 1,680

Radiological inspections: 45 HRCQ shipments                                $ 12,600

Radiological inspections: 135 low-level shipments                          $ 37,800

DNR Fund Administration                                                                 $ 39,800

Environmental Monitoring                                                                 $ 13,500

Training & Notification of Local Responders                                    $ 72,404

Equipment & Supplies for State & Local Responders                       $104,214

Total Option 1 Expenses                                                                    $351,475

ASSUMPTION (continued)

Monies would be used by DPS, DOH and MDNR for purposes including, but not limited to, inspections, escorts, and security for waste shipment and planning; coordination of emergency response capability; education and training of state, county and local emergency responders;

purchase and maintenance of necessary equipment; emergency responses to any transportation incident involving high-level radioactive waste, transuranic radioactive waste, highway route controlled quantity shipments, spent nuclear fuel or low-level radioactive waste; oversight of an environmental remediation necessary resulting from an incident; and administrative costs attributable to the state agencies which are incurred through their involvement.

To meet the staffing needs from this proposal the department would use existing FTE. The department would restructure the duties to the FTE to implement the requirements of this legislation. For purposes of this fiscal note, the costs for the FTE is charged to the Environmental Radiation Monitoring Fund which is a shift from the Hazardous Waste Fund and Federal funds. Therefore, a corresponding savings is shown to the Hazardous Waste and Federal Funds.

County and local emergency responders would receive training, equipment and supplies as funds are available from this proposal.

Senate Amendment 1:

In response to a similar proposal from this year (SB 881), officials from the Missouri Department of Transportation (MoDOT) assumed this would require MoDOT to establish rules and regulations for the drunk driving victim memorial sign program. MoDOT will be responsible for establishing rules and regulations for the sign application process, the sign qualification process, the procedure for sign dedication, and procedures for replacement or restoration of signs that are damaged or stolen. MoDOT will also be responsible for determining placement, location and spacing of the signs. The total cost of two signs, one for each direction will be $1,040. Based on statistics from the safety division, Missouri averages about 270 alcohol related fatalities per year. If signs are made in each instance, this would result in a total cost of $280,800 per year. There should be no fiscal impact to MoDOT, because a “sponsoring fee” may be charged to cover costs in designing, constructing, placing and maintaining the signs, as well as MoDOT’s costs in administering the program.

Oversight assumes no fiscal impact to MoDOT or the State Road Fund as a result of this proposal since the proposal allows MoDOT to charge a fee to cover all costs associated with the signs.

ASSUMPTION (continued)

Senate Amendment 2:

Officials from the Department of Revenue (DOR) state currently all renewal notices are printed utilizing a professional flyer that uses color to distinguish pertinent information to Missouri citizens about the vehicle renewal registrations. The information contained in these color sections specifically indicate the requirements for renewal and what needs to be submitted for compliance. In addition, the notice allows for opportunity to highlight public safety issues and law changes.

DOR will incur the following impact to ensure that the quality of renewal notices to Missouri citizens is maintained.

•          Incur all forms and printing/envelope costs.

•          Additional postage costs for 3.4 million renewal notices each year. DOR only pays $.191 per renewal notice for postage because this is at the postcard rate.

•           Incur maintenance costs for the machine that inserts/folds the renewals in the Mail Service Center at $45,000 each year.

These expenses are $793,000 in FY'09, $970,878 in FY'10, and $1,000,006 in FY'11. All other forms, printing, and envelope costs are paid for by the vendor in accordance with the contract, in return for DOR allowing advertising to be included with the notices.

In response to a similar proposal from this year (HB 1519), officials from the Office of Administration Information Technology (ITSD DOR) estimated that this legislation could be implemented utilizing 3 existing CIT III's for 2 months at a rate of $25,116. ITSD DOR estimates the IT portion of this request can be accomplished within existing resources; however, if priorities shift, additional FTE/overtime would be needed to implement. Funding would be requested through the budget process.

Senate Amendment 5:

In response to a similar proposal from this year (SB 936), officials from the Department of Revenue (DOR), Department of Transportation (MoDOT) and Department of Natural Resources (DNR) assumed no fiscal impact to their agency.

Officials from the City of St. Louis (STL) have not responded to our request for a fiscal impact from this proposal.

ASSUMPTION (continued)

Senate Amendment 6:

In response to a similar proposal from this year (SB 1187), officials from the Department of Public Safety - Director’s Office and the Water Patrol each assumed the proposal would not fiscally impact their respective agencies.

Oversight assume the amendment, by itself, would not have a direct fiscal impact upon the state. Oversight assumes the proposal would allow the Water Patrol to potentially get appropriations for additional members; however, Oversight assumes that would not be a direct fiscal impact resulting from this amendment.

Senate Amendment 8:

In response to a similar proposal from this year (SB 722), officials from the Office of Administration, Division of Budget and Planning (BAP) assume there should be no added cost to BAP as a result of this bill. BAP officials stated that the Department of Elementary and Secondary Education (DESE) may also want to comment on this proposal.

BAP officials assume that exempting motor fuel used to operate public school buses from the Motor Fuel Tax would mean fewer dollars deposited into the Motor Fuel Tax Fund for distribution to the State Highways and Transportation Department Fund, County Aid Road Trust Fund, and funds distributed to cities, towns and villages.

In response to a similar proposal from this year (SB 722), officials from the Missouri Department of Conservation (MDC) assumed this proposal would appear to have a negative fiscal impact on MDC funds since it appears to exempt motor fuel used in school buses from sales tax. However, MDC is unable to provide the estimated amount and will rely on DOR for the fiscal impact of this legislation.

Officials from the Department of Revenue (DOR) assume this proposal would create the need for form changes and minor Fuel Tax system changes, and for an informational bulletin to be sent to all the school districts in Missouri. DOR Division of Taxation does not anticipate a significant direct impact from this legislation.

DOR officials forwarded an estimate from the Office of Administration Information Technology (ITSD/DOR). ITSD/DOR assumes this proposal could be implemented utilizing 1 existing CIT III for 1 month for modifications to MINITS at a cost of $4,186. ITSD/DOR assumes the IT

ASSUMPTION (continued)

portion of this request could be accomplished within existing resources, however; if priorities shift, additional FTE/overtime would be needed to implement.

DOR officials stated that any exemption of fuel tax would reduce the amount of funds distributed to MODOT and political subdivisions. Counties currently receive a 10% share of the proceeds while cities receive a 15% share, of the first 11 cents of the motor fuel tax. For the 6-cent motor fuel tax enacted in 1992, counties receive a 15% share of proceeds and cities receive a 15% share.

Officials from the Department of Transportation (MODOT) assume this proposal would result in reduced collections for the Road fund and to local governments.

According to DESE they expect a 1.002% bus travel growth annually. The total bus miles traveled during the 2006-07 school year was 126,226,556. The average school bus gets 7 miles per gallon. Total gallons used (126,226,556/7=18,032,365.14). That would be an income lose of $3,065,502.07. Adding the 1% growth rate the impact would be ($3,077,776.34) (FY 09), ($3,083,931.90) (FY 10) & ($3,090,099.76) (FY 11) - Note this also includes the lost revenue to cities and counties.

In response to a similar proposal from this year (SB 722), officials from the Department of Elementary and Secondary Education (DESE) assumed this proposal would create a savings to school districts and a loss to the state. DESE calculates that total miles traveled by school district owned and contracted buses were 126,045,655 for the 2006-2007 school year. By dividing total miles by an average of 7 miles per gallon, this yields 18,006,522 gallons of fuel used annually. Multiplying gallons of fuel used by 17 cents per gallon (the current Missouri fuel tax) results in an estimated annual fuel tax exemption for school districts of $3,061,109.

The above estimate assumes that school bus contractors have arrangements or can make arrangements so that the Missouri fuel tax will not be paid by the school bus contractors thereby reducing the cost of bus transportation to school districts. For example, it is a practice by some school districts to purchase the fuel used by contractors.

Oversight notes that school mileage reported by DESE did not increase from 2005-2006 to 2006-2007. Oversight assumes for the purposes of this fiscal note that school bus mileage will remain constant, that the school districts would realize the full savings from the proposal, and that administrative costs to the state and the school districts would be minimal. Oversight also assumes the proposal would become effective as of August 28, 2008 and has reflected the fiscal impact for a full school year. Oversight has calculated the estimated impact of this proposal in

ASSUMPTION (continued)

the following table.

Senate Amendment 10:

Officials from the Office of the State Courts Administrator assume this amendment will not fiscally impact the courts.

Officials from the Department of Revenue assume no impact from this amendment.

Officials from the Department of Public Safety assume this amendment would not fiscally impact their agency.

Officials from the Department of Public Safety - Missouri Highway Patrol (MHP) state this amendment states that MULES will be searched for intoxication-related traffic offenses. However, MULES is not currently designed to access databases that include this information. The Patrol would have to create new queries to access databases outside of MULES. A consultant would need to be hired, and this would require 480 hours of work to develop these new queries, at a cost of $100 per hour. This would be a total of $48,000 (480 hours x $100 per hour).

Senate Amendment 11:

Oversight assumes this amendment will not have a fiscal impact on the Department of Public Safety.

Officials from the Department of Public Safety assume this amendment would not fiscally impact their agency.

ASSUMPTION (continued)

Senate Amendment 12:

Officials from the Office of the State Courts Administrator assume this amendment will not fiscally impact the courts since it is permissive (may).

Officials from the Department of Revenue assume no impact from this amendment.