LEGISLATIVE BUDGET BOARD
Austin, Texas
FISCAL NOTE
75th Regular Session
April 22, 1997
TO: Honorable Kenneth Armbrister, Chair IN RE: Senate Bill No. 602, Committee Report 1st House, as amended
Committee on State Affairs By: Armbrister
Senate
Austin, Texas
FROM: John Keel, Director
In response to your request for a Fiscal Note on SB602 ( Relating
to the period of validity of and fees for a driver's license
or personal identification certificate.) this office has detemined
the following:
Biennial Net Impact to General Revenue Funds by SB602-Committee Report 1st House, as amended FN Revision 1
Implementing the provisions of the bill would result in a net
positive impact of $277,393,000 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 remove the requirement
that driver's licenses and personal identification certificates
issued by the Department of Public Safety (DPS) expire on the
fourth anniversary of the date of application. It would change
the expiration date of a driver's license and personal identification
certificate from the fourth anniversary of the date of the application
to the 60th birthday of the license or personal identification
certificate holder.
The bill would require the Department
of Public Safety to reissue a license or certificate of a holder
who is under 60 years old without charge at six-year intervals
to include changes in the pertinent information shown on the
license or certificate. However, the bill would not require
the license or certificate holder to return to a DPS office
prior to the document's expiration if pertinent information
remains correct.
The bill would also change the license
and certificate fee structure. Those at least 18 years old,
but younger than 25 years old would pay $85; those at least
25 years old, but younger than 35 years old would pay $75; those
at least 35 years old, but younger than 45 years old would pay
$60; those at least 45 years old, but younger than 50 years
old would pay $40; those at least 50 years old, but younger
than 55 years old would pay $20; and those at least 55 years
old would pay $16. It would also set the four-year license
renewal fee at $16 for those 60 and older, and change the renewal
fee of a personal identification certificate to $5 for a person
60 years old or older.
Department of Public Safety would
also be required to provide, at the request of a license or
certificate applicant, an installment payment plan over a one-year
period.
Currently, the cost of a Class C driver's license
is $16 for an original license and $10 for a replacement license.
The cost of an identification card is $5 for those 65 years
or older and $10 for those younger than 65. The cost for a
renewal or duplicate identification card is $10.
The bill
would increase the fee by $8 for the issuance or renewal of
a motorcycle or moped license. In addition, the bill would increase
the fee for a commercial driver's license from $40 to $60 and
would set the expiration date of a commercial driver's license
(CDL) or commercial driver learner's permit to six years after
the applicant's next birthday. For a CDL with an authorization
to operate a motorcycle or moped, the fee for issuance or renewal
of the license or permit would be increased by $8.
The bill
would take effect September 1, 1997.
Methodolgy
The bill would partially implement the Texas Performance Review
(TPR) recommendation GG17 to authorize the establishment of
an extended driver's license program in Texas.
The estimate
assumes that in fiscal 1998 the 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 $72.5
million in driver's license fees and renewal and duplicate personal
identification fees in fiscal 1998.
Based on estimates
of driver's 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.
Using the 20.5 percent replacement license and 79.5 percent
original license ratio, it is estimated the DPS would generate
$203.4 million in Class C license fees and renewal and duplicate
personal identification fees in fiscal 1998.
The Department
of Public Safety also issues an estimated 400,000 original personal
identification cards in a year, but does not provide data by
age group except for those age 65 and older. The fees generated
by the proposed change in the law as it relates to original
personal identification cards would add some revenue to the
General Revenue Fund.
The forecasted increase in revenue
is based on the Comptroller s estimates for growth rates in
the amount of driver's license revenue under the current system
as compared to the proposed system. After the four year extended
driver's license conversion period, which would conclude in
fiscal 2002, the revenue from the issuance of Class C licenses
and personal identification cards under the proposed fee structure
would be expected to drop, reflecting the elimination of renewals
except for those license and card holders aged 60 and above.
This estimate attempts to take into account new Texas drivers
by subtracting the estimate of Class C licenses issued under
the current system in 2002 from the licenses issued in 2001.
In addition, this estimate assumes the same 20.5 percent ratio
of replacement licenses.
During the first four years of
establishing the program, DPS would need to augment personnel
in three areas: 1) Information Management Service, to rewrite
computer programs that designate fees and expiration dates designated
by current statue 2) Central Cash Receiving, as an approximated
1,800,000 individuals' installment payments are received and
processed for deposit, and 3) the License Issuance Bureau, as
that unit traces the status of unpaid installments. Otherwise,
DPS's headquarters and field operations would remain static
for the next four years as the current renewal cycle is completed.
The $8 fee increase for the issuance or renewal of a motorcycle
or moped license would generate about $431,000 per year for
four years for the General Revenue Fund. The bill would increase
the fee for a commercial driver's license or commercial driver
learner's permit from $40 to $60. Commercial driver's licenses
aare on an unequal renewal cycle, so some years see more renewals
than others. In 1996, there were about 585,800 total CDL's,
and of that total, 198,000 were renewals. About 48,000 new CDLs
are issued each year. DPS estimated a three percent growth rate
for CDLs. Additional revenue generated by the $20 fee increase
on CDLs would total $7.2 million to the General Revenue Fund
in the next biennium, and $16.9 million over the next five years.
Once
the extended driver's license conversion process is complete,
a portion of the DPS's $51.3 million driver's license issuance
budget could be reduced, depending on reduction in foot traffic
at the DPS after 2001. It is estimated that traffic into DPS
offices would drop by more than 50 percent in 2002. This estimate
assumes a 25 percent reduction in the number of employees responsible
for driver's license issuance in 2002.
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 Probable Change in Number
Gain/(Loss) from Savings/(Cost) of State
General Revenue from State Employees from
Fund Highway Fund FY 1997
0001 0006
1998 $137,535,000 ($4,381,230) 65.0
1998 139,858,000 (3,151,308) 65.0
2000 143,593,000 719,246 50.0
2001 147,014,000 719,246 50.0
2002 (53,155,000) 10,336,000 (500.0)
Fiscal Year Probable Revenue
Gain/(Loss) from
Motorcycle
Education
Account/
GR-Dedicated
0501
1998
1999 162,188
2000 162,188
2001 162,188
2002
Net Impact on General Revenue Related Funds:
Fiscal Year Probable Net Postive/(Negative)
General Revenue Related Funds
Funds
1998 $137,535,000
1999 139,858,000
2000 143,593,000
2001 147,014,000
2002 (53,155,000)
The 74th Legislature passed Senate Bill 1504, which allows local
courts that adjudicate violations of the state's traffic laws
to contract with DPS to deny renewal of a driver's license to
a person who fails to appear to answer to charges of traffic
law violations. According to DPS, The "Failure to Appear" program,
with its database and denial sanctions, is projected to assist
local units of government with collections of approximately
$37,000,000 annually in fine related revenue by 2002. If driver's
licenses were to be issued for the potential number of years
that the bill allows, denial of driver's license renewal would
cease to be an effective deterrent to failing to appear for
traffic summons.
Source: Agencies: 304 Comptroller of Public Accounts
405 Department of Public Safety
LBB Staff: JK ,JD ,GG ,RS