TITLE: CONCERNING ELIMINATION OF THE REQUIREMENT THAT A DISABLED VETERAN OBTAIN THE DISABILITY PRIOR TO MAY 7, 1975, IN ORDER TO BE ELIGIBLE TO RECEIVE SPECIAL LICENSE PLATES WITHOUT CHARGE, AND MAKING AN APPROPRIATION IN CONNECTION THEREWITH.

The reengrossed bill would allow any disabled veteran, regardless of when the disability was obtained, to be eligible to receive one set of special license plates without charge. Current law requires that a disabled veteran had to have obtained the disability prior to May 7, 1975, in order to receive one set of special license plates without charge. The bill would become effective upon the Governor’s signature.

STATE FISCAL IMPACT SUMMARY	FY 1998/99	FY 1999/2000
State Revenues General Fund HUTF	$0 $0	$0 $0
State Expenditures Schools of Choice Fund (transfer to GF) Schools of Choice Fund (transfer to HUTF)	$53,320 $57,000	$53,320 $57,000
FTE Position Change	None	None
Local Government Impact —The specific ownership tax revenue reduction includes approximately $53,320 for school districts that will be reimbursed for operating purposes through the School Finance Act and is replaced by a transfer from the State Schools of Choice Fund.

Motor vehicle registration fee collections would be reduced as a result of this bill. It is estimated that the average registration fees paid on vehicles seven years old or less is $57. There are an estimated 1,000 persons that would apply for the free set of license plates which would reduce registration fee collections to the Highway Users Tax Fund (HUTF) by $57,000 annually. The reengrossed bill would transfer $57,000 from the State Schools of Choice Fund to the Highway Users Tax Fund to offset the lost revenue. The net impact to the HUTF would be zero. However, this would reduce TABOR refund by $57,000.

Section 20 of Article X of the Colorado Constitution, limits the maximum annual percentage increase in state fiscal year spending. Once total state revenue from all sources that are not specifically excluded from fiscal year spending exceeds these limits for the fiscal year, the state constitution requires that the excess shall be refunded in the next fiscal year unless voters approve a revenue change as an offset. Based on the current Legislative Council economic forecast, it is projected that the state will be in a TABOR refund position during each of the next five fiscal years. Any increase or decrease in state revenue from changes in fees, fines, licenses, or other revenue sources will affect the amount of the state revenue to be refunded.

The Department of Revenue would have some minimal expenditures as a result of this bill. The application process for the plates would require some additional FTE workload that would be absorbed within the existing workload. Changes to the registration manual and mailing costs would also be absorbed within existing appropriations.

The reengrossed bill would result in a reduction in specific ownership tax collections for units of government (see the Local Government Impact section below) where affected veterans are located. However, since state aid for schools is computed as the difference between Total Program and the amount collected from property taxes and specific ownership taxes, state aid would be increased to make up for the lost operating budget from decreased specific ownership tax revenue through the School Finance Act in affected school districts. The need for additional state aid through the School Finance Act identified in this bill is estimated to be $53,320. The reengrossed bill transfers $53,320 from the State Schools of Choice Fund to the General Fund to offset the lost revenue.

It is estimated that this bill would reduce statewide specific ownership tax collections by an estimated $124,000. Specific ownership taxes are distributed to the county and each political and governmental subdivision located within the county based on the proportionate ad valorem taxes levied within the county in the preceding year. Of the $124,000 loss in Specific ownership taxes, 43 percent, or approximately $53,320 of this amount will be made up to school districts through the School Finance Act. The reengrossed bill transfers $53,320 from the State Schools of Choice Fund to the General Fund to offset the lost revenue.

The reengrossed bill contains an appropriation clause that would transfer $53,320 from the State Schools of Choice Fund to the General Fund to offset the loss in specific ownership taxes that would impact the Department of Education, Public School Finance, Total Program of $53,320. The appropriations clause also transfers $57,000 from the State Schools of Choice Fund to the Highway Users Tax Fund to offset the loss of registration fees.

1. That there are 8,145 veterans that are at least 50 percent disabled and would be eligible to receive a set of free license plates.

3. That 4,140 of those disabled veterans receive a set of free plates under current law.

4. That most of the disabled veterans received their disability during the Vietnam conflict and are already eligible to receive a set of free plates.

4. That 1,000 new disabled veterans would apply for a free set of license plates under the new requirements in this bill.

5. That the average motor vehicle fees and taxes on vehicles less than seven years old is representative of the average paid by disabled veterans.

6. That the average registration fees for motor vehicles is $57 and the average specific ownership tax is $124.