House Bill 1087: BMV Omnibus Bill

Objectives

1. Simplify Indiana Code Title 9

2. Streamline Registrations and Credentials

3. Reduce Complexity within Fee Structure

4. Promote Fairness and Transparency

5. Maintain Revenue Neutrality

Fact Sheet re HB 1087

• No Tax Increases

• Approx. 2.1 million Hoosiers See Fee Decreases

• 163 Registration Fees are Reduced/Eliminated

• BMV’s Fee Chart Reduced to One Page

• Promotes Transparency re Third Party Transactions

• Consolidates Vehicle Weight Classes

• Streamlines Vehicle Type/Weight Class Fees

• Consolidates Credentials / Endorsements

• Simplifies Semitrailers (Permanent, Transferrable)

• Revenue Neutral

• Fees are Consistent, Predictable

• Externally-Funded Groups Not Impacted Negatively

• Updates Language to Conform w/ Modern Practice

• Addresses BKD Assessment Items re Compliance

• Technical Corrections from Previous Drafting Errors

• Simplifies Buses (For-Hire / Not-For-Hire)

• Farm Vehicles = 50% off Registration Fee

• Pro-Rated System (Fairness; Based on Use)

Credentials: For-Hire Endorsement

• Currently there are four different types of licenses:

• Operator’s

• Public Passenger Chauffeur’s (e.g., taxi drivers)

• Chauffeur’s (vehicles between 16,000 pounds and 26,000 pounds for hire)

• Commercial Driver’s License (more than 26,000 pounds)

• The bill converts the PPC and Chauffeur’s Licenses into a uniform for-hire

endorsement on an Operator’s License

• No impact on CDL program

Credentials: Motorcycle Endorsement

• Currently, motorcyclists pay $12 or $10.50 upon each license renewal.

• The bill changes this fee to a one-time endorsement fee of $19,

resulting in a net savings to Hoosier motorcyclists.

• Current motorcycle endorsement holders will not pay any

endorsement fee on renewals.

Simplification: Vehicle Registrations/Fees

Current System

• 191 ways to register a vehicle and pay the corresponding fee (including half-year fees)

• 21 truck, tractor, and bus weight classes

• Different vehicle types within the same weight classes pay different fees

• Farm vehicles pay approximately 52% of the basic registration fee for the appropriate weight

class (original intent was 50%, but various legislative add-ons over time have bumped this

number up)

• Fees are random, arbitrary amounts (e.g., $.25 / .35 / .50 / .75 / .00) • BMV offers ½-year fee structure; Indiana Dept. of Revenue offers pro-rated fee structure

Simplification: Truck and Semi-Tractor Registrations

Current system:

• 21 weight classes

• Different fees for trucks and semi-tractors at same weight class

• One of only 4-5 states with different fees for trucks/semi-tractors

• 51-53% registration discount for farm truck/semi-tractor

Proposed system:

• 8 weight classes

• Fee decreases

• Trucks and semi-tractors pay same fee at same weight class

• Farm truck/semi-tractor registrations receive consistent 50% discount

Registration: Semitrailers

• Consolidate semitrailer registration options:

• 1-year (transferrable, $41.75)

• 5-year (transferrable, range of $41.75 to $77.75)

• Permanent (not transferrable, $82.75)

• All registrants convert to permanent registration

• $82 for initial registration

• $8.75 each year

• Proposed permanent registration is transferrable

Permanent Only

Perm.

5 Year 1 Year

Simplification: Bus Registrations

Bill consolidates into two types of buses: for-hire and not-for-hire

• Does not impact municipal buses (exempt from registration fees)

• Not-for-hire registration fee decreases to $16.35/year.

• Some for-hire buses see fee increases to match what trucks/semi-tractors of same weight pay.

• Fee increases affect approximately 499 buses per year.

Currently, there are 33 ways to register a bus:

intercity buses (11 weight classes)

intracity buses

school buses

special purpose buses

church buses

“other” buses

Registration: Pro-rating Fees

• Currently, BMV offers a half-year fee for certain commercial registrations.

• The bill proposes pro-rated fees (if eligible).

• All pro-ratable fees are whole numbers, divisible by 12.

• Consumer pays for the months used during a registration period.

• Matches how Department of Revenue treats similar registrations.

Registration: Pro-rating Fees

Date of Purchase

Current System Proposed System

July Pay full-year registration fee for only eight

months ($1359.75) Pay eight months of registration fees

($1356 * 8/12 = $904)

September Pay half-year registration fee ($682.75) Pay six months of registration fees

($1356 * 6/12 = $678)

January Pay half-year registration fee for only two

months ($682.75) Pay two months of registration fees

($1356 * 2/12 = $226)

BMV Fee Chart

Transparency: Contractor Convenience Fees

• Amount of convenience fee subject to the written approval of the BMV Commission.

• Convenience fee charged cannot exceed the following:

• Title Work: 150% of the $15 Title Fee ($22.50)

• Registration Work: 150% of the $21.35 Passenger Motor Vehicle Fee ($32.03)

• BEFORE a convenience fee is charged, the contractor must disclose, in writing:

1. The amount of the convenience fee 2. That this convenience fee is NOT charged at a BMV license branch for the same transaction 3. The address and hours of operation of the closest BMV license branch 4. The distance to the closest BMV license branch

• Notice must be provided in a single, discrete document that includes no additional terms

or conditions. Customer must agree to the charge in writing or electronically.

Maintaining Neutrality: Delinquent Penalties

• Make up for lost revenue from fee decreases

• Delinquent:

• registration: $5 to $15

• license: $5 to $6

• title: $21.50 to $30

• watercraft title: $20 to $30

Highway Funds

• Motor Vehicle Highway Account

• Highway, Road and Street

• Crossroads 2000

BMV Related Funds

• Commission Fund

• Motor Vehicle Technology Fund

Public Safety Funds

• IPSC

• State Police Building Account

Other

• Spinal Cord & Brain Injury Fund

• Various Charities and Organizations

Fees Collected by BMV

Maintaining Neutrality: Distributions

Fund 12-14 CY Average Change with Proposal % Change

Motor Vehicle Highway $ 119,665,868 $ 698,500 0.58%

Highway, Road and Street (State and Local)

$ 17,213,699 $ 174,500 1.00%

Crossroads 2000 $ 35,982,189 $ 19,000 0.05%

IPSC (Anti-terrorism) $ 13,256,712 $ 43,000 0.32%

Spinal Cord $ 1,666,119 $ 14,100 0.84%

Police Building $ 1,701,172 $ 2,400 0.14%

BMV Tech $ 5,383,023 $ 36,000 0.66%

Commission $ 85,793,936 ($ 1,030,000) (1.22%)

DNR $ 1,573,817 $ 2,000 0.13%

Maintaining Neutrality: Fiscal Impact

Fee Changes: Impact of HB 1087

• Registration Fees • 163 registration fees are reduced or eliminated

• 8 registration fees increase • Standardizes commercial vehicles (same weight = same fee)

• Affects only 643 customer transactions per year, out of 12.6 million (< 0.005%)

• Duplicate, Amended, or Replacement Items • To streamline fees for similar transactions:

• 6 fees decrease

• 6 fees increase

Objectives

1. Simplify Indiana Code Title 9

2. Streamline Registrations and Credentials

3. Reduce Complexity within Fee Structure

4. Promote Fairness and Transparency

5. Maintain Revenue Neutrality

House Bill 1087: BMV Omnibus Bill