FISCAL NOTE, 2006 LEGISLATIVE SESSION

HB 1114 exempt from motor vehicle license fees certain motor vehicles used to transport children to and from certain head start programs.

NOTE: This fiscal note rescinds Fiscal Note 2006-HB 1114A.

SDCL 32-5-42 exempts from fees for registration buses and other motor vehicles owned by a long list of entities. These entities include: the state, the federal government, counties, townships, municipalities, public or nonpublic schools, Indian mission schools, Indian tribes, and fire departments. This bill adds federally-funded Head Start programs to that list.

After consultation with the Department of Education (DoE) and the Department of Revenue and Regulation (DoRR), it is estimated that House Bill 1114 would have the following impact on state and county finances:

Agency/Item	General Fund	Federal Funds	Other Funds	Total	FTE
Revenue:
Excise Tax (State) Registration	$0	$0	($16,000)	($16,000)
License Fees(Counties)	$0	$0	($ 7,000)	($ 7,000)
Total Revenue	$0	$0	($23,000)	($23,000)
Total Expenses	$0	$0	$0	$0	0.0
Net Impact	$0	$0	($23,000)	($23,000)	0.0

According to DoE, there are 6 federally-funded Head Start programs serving 59 of the 66 counties in South Dakota. The 6 programs own a total of 29 buses and 140 other vehicles. The programs have reported to the Department that their bus license fees average $50 and the fees for other vehicles slightly less. (Of $50, about $41 goes to the state, $8 to counties, and $1 to the waste fee for disposal of plates.) DoE estimates the total savings to the Head Starts would be less than $10,000 per year for registration of vehicles. This savings to the Head Starts would be a loss of revenue to the state and counties of less than $10,000 per year.

Therefore, the savings to Head Starts, and consequent loss of revenue to ranges from $10,000 to approximately $23,000 depending upon excise tax revenues.

APPROVED BY:_______________________________________ DATE:____________