Colorado Legislative Council Staff



(replaces fiscal impact dated January 12, 1999)

Drafting Number:

Prime Sponsor(s):

LLS 99-0047

Rep. Kaufman


Bill Status:

Fiscal Analyst:

March 16, 1999

House Appropriations

Scott Nachtrieb (303-866-4752)



Fiscal Impact Summary

FY 1999/2000

FY 2000/2001

State Revenues

Cash Fund



State Expenditures

Cash Fund



FTE Position Change

3.2 FTE

3.2 FTE

Other State Impact: TABOR

Effective Date: The bill would become effective upon the Governor's signature.

Appropriation Summary for FY 1999-2000:The Department of Revenue would require $103,167 and 3.2 FTE in Highway User Tax Funds.

Local Government Impact: Increased HUTF distributions from increased special fuel tax collections.

Summary of Legislation

            This fiscal note has been revised based on the receipt of additional information. The bill would allow Ports of Entry personnel to check a vehicle's fuel tank for dyed tax-exempt diesel fuel when the vehicle is required to stop at a Port of Entry Weigh Station. It would be illegal to operate a motor vehicle on any public highway using dyed diesel fuel and specifies increasing penalties for violations within a 12-month period. The Department of Revenue would conduct audits of persons caught violating the law and the department would be required to report violations to the federal Internal Revenue Service.

State Revenues

            Revenues to the Highway Users Tax Fund (HUTF) would increase from an increase in special fuel taxes caused by increased compliance and new fines. Therefore, the bill is assessed as having a fiscal impact. States that have adopted dyed fuel testing programs have experienced a five to seven percent increase in special fuel tax collections. It is estimated that Colorado would experience a similar increase in special fuel taxes. Colorado collected approximately $68.4 million in special fuel taxes in FY 1997-98. A five percent increase would generate approximately $3.4 million in additional special fuel tax collections. A seven percent increase would generate approximately $4.8 million in additional special fuel tax collections.

            The bill also would impose a fine of $500 and a sixty dollar surcharge for persons convicted of violating the new program one time a year. It is estimated that approximately 713 persons would be convicted of violating this bill one time annually. This would generate approximately $356,500 in fines annually to the HUTF. An estimated 37 persons would commit subsequent violations within a twelve month period which would result in a $1,000 fine and one hundred twenty dollar surcharge per offense for a total of $37,000 in fines. The total estimated fine increase to the HUTF would be $393,500. An estimated $47,220 would be collected from the sixty dollar and one hundred twenty dollar surcharge which would go directly to the county with jurisdiction over the matter.

            The total increase in HUTF revenue for FY 2000 is $3,813,500.

State Expenditures

            The Motor Carriers Services Division in the Department of Revenue would require 3.2 FTE and $103,167 HUTF as a result of this bill. Personal services would be for 2.4 FTE Port of Entry Officers ($78,294) to conduct an estimated 25,000 ten minute fuel tank inspections/tests and issue an estimated 750 citations for violations. An additional 0.8 FTE Administrative Assistant ($18,547) would be required to collect data on violators for audit purposes, maintain accounts, and develop a tracking system for the program. Operating costs would be $1,996 and capital outlay costs would be $4,330.

Local Government Impact

            Cities and counties would receive additional HUTF distributions as a result of increased compliance with the special fuel tax. The additional revenues would be distributed to cities and counties using both of the current HUTF distribution formulas. County courts with jurisdiction over the citations would receive the additional surcharges.

State Appropriation

            This fiscal note implies that the Department of Revenue would require 3.2 FTE and $103,167 in HUTF spending authority for FY 1999-2000 to implement this bill.

Departments Contacted