LEGISLATIVE BUDGET BOARD Austin, Texas FISCAL NOTE 75th Regular Session April 10, 1997 TO: Honorable Keith Oakley, Chair IN RE: House Bill No. 1200, Committee Report 1st House, Substituted Committee on Public Safety By: Cuellar/et al. House Austin, Texas FROM: John Keel, Director In response to your request for a Fiscal Note on HB1200 ( Relating to the validity of and fees for a driver's license, learner's permit, or personal identification certificate.) this office has detemined the following: Biennial Net Impact to General Revenue Funds by HB1200-Committee Report 1st House, Substituted Implementing the provisions of the bill would result in a net positive impact of $57,600,000 to General Revenue Related Funds through the biennium ending August 31, 1999. The bill would make no appropriation but could provide the legal basis for an appropriation of funds to implement the provisions of the bill. Fiscal Analysis The bill would amend the Transportation Code to change the expiration date of a driver's license from the fourth anniversary of the date of the application to the sixth anniversary of the date of application beginning September 1, 1997. Certificates issued to those persons 60 years of age or older would not expire. Commercial driver's licenses or commercial driver learner's permits would expire six years after the applicant's next birthday. The bill would change the license and certificate fee structure. The fee for the six-year driver's license would increase from the current $16 to $24. The fee for a personal identification certificate would increase to $15 from the current $10 for a person under 60 years of age. For a person 60 years of age or older, it would be $5. The bill would increase the commercial driver's license or commercial driver learner's permit fee from $40 to $60. If a commercial driver's license or commercial driver learner's permit included authorization to operate a motorcycle or moped, the fee for the license or permit would be increased by $8. The bill states that the Department of Public Safety (DPS) by rule may provide for the staggered expiration of licenses, permits, and certificates so that a proportionate number of licenses, permits, and certificates would expire each year. The fees would be prorated accordingly. Methodolgy This estimate assumes that in fiscal year 1998, DPS would issue 4.7 million Class C driver's licenses and 245,000 renewal or duplicate identification cards. Under current law, the DPS is expected to generate an estimated $70.1 million in drivers' license fees and an additional $2.45 million in personal identification fees in fiscal year 1998. Based on estimates of drivers' licenses obtained from the DPS and population projections made by the Comptroller of Public Accounts, about 20.5 percent of all Class C licenses issued are of the $10 replacement variety. The remaining 79.5 percent are issued as original licenses. The proposed fee structure would raise the fees generated by Class C licenses and personal identification cards. Using the same ratio of 20.5 percent for replacement licenses and 79.5 percent for original licenses, the DPS would be expected to generate an additional $28.6 million in Class C license and personal identification fees in fiscal year 1998, increasing to $30.6 million in 2001. There would also be some revenue gain from the increase in fees for commercial drivers' licenses. Following the completion of the four year conversion period in 2002, the revenue from the issuance of Class C licenses and personal identification cards under the fee structure proposed by this bill could drop by $61.4 million. A pattern of four years of revenue gains followed by two years of revenue losses relative to current law would continue for some period, even after factoring in revenue gains from new drivers. Although the bill states that the DPS can stagger expiration dates for licenses, permits, and certificates and prorate the fees accordingly, this estimate includes no proration of fees. The probable fiscal implications of implementing the provisions of the bill during each of the first five years following passage is estimated as follows: Five Year Impact: Fiscal Year Probable Revenue Gain/(Loss) from General Revenue Fund 0001 1998 $28,600,000 1998 29,000,000 2000 29,500,000 2001 30,600,000 2002 (61,400,000) Net Impact on General Revenue Related Funds: The probable fiscal implication to General Revenue related funds during each of the first five years is estimated as follows: Fiscal Year Probable Net Postive/(Negative) General Revenue Related Funds Funds 1998 $28,600,000 1999 29,000,000 2000 29,500,000 2001 30,600,000 2002 (61,400,000) No significant fiscal implication to units of local government is anticipated. Source: Agencies: 304 Comptroller of Public Accounts LBB Staff: JK ,CB ,MG