FINAL BILL REPORT

HB 403

                                  C 220 L 87

BYRepresentatives Walk and Schmidt; by request of Department of Transportation

Transferring responsibility for aircraft registration and excise tax collection to the department of transportation.

House Committe on Transportation

Senate Committee on Transportation

SYNOPSIS AS ENACTED

BACKGROUND:

Pilot registration fees are currently collected by the Department of Transportation, but aircraft registration and aircraft excise taxes are collected by the Department of Licensing.  This split of administrative responsibilities creates confusion for the taxpayer.

An increasing number of small aircraft are being certified by the Federal Aviation Administration to use motor fuel instead of aviation fuel.  Although individuals using motor fuel in an aircraft are entitled to a refund of the state fuel taxes they paid, many do not bother collecting their refunds.  If a refund is obtained, then use tax liability arises.  The use tax is credited to the General Fund.

SUMMARY:

Responsibility for administering aircraft registration fees and aircraft excise taxes is transferred to the Department of Transportation (DOT).  The cost for administering these programs will be met by transferring 10 percent of the aircraft excise taxes from the General Fund (GF) to the Aeronautics Account (AA).  In addition, an annual transfer will be made from the Motor Vehicle Fund (MVF) to both the Aeronautics Account and to the General Fund.  These transfers will equal the difference between .028 percent of gross motor vehicle fuel tax receipts and the total amount of refunds claimed for motor fuel purchases used for aviation purposes.

DOT is granted authority to require aircraft registrations on a staggered basis and to raise registration fees from $5 to $10.  There is no plan to change either the collection date or to increase the fees for the 1987-89 biennium.

The fiscal effect of 1) transferring 10 percent of the General Fund portion of aircraft excise taxes to the Aeronautics Account, 2) transferring aircraft registration fees from the General Fund to the Aeronautics Account, and 3) transferring unclaimed motor fuel tax refunds out of the Motor Vehicle Fund to the Aeronautics Account and General Fund is as follows:

@p1!tp2,1,1,1 !tl    GF!tl   AA!tl    MVF

10% share of aircraft excise!tl  (42,465)!tl  42,465!tl    N/A

Aircraft Registration fees!tl  (35,388)!tl  35,388!tl    N/A

Aviation Refunds!tl  214,106 !tl 145,935!tl (360!sn,041)

!tl $136,253!tl$223,787!tl($360,041)

@p0An appropriation of $223,787 is made from the Aeronautics Account of the General Fund to the Department of Transportation.  There is one additional full-time employee.

VOTES ON FINAL PASSAGE:

      House 97   0

      Senate    40     0

EFFECTIVE:July 26, 1987