Public Transportation- House
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Bills discussed (1)
| Bill | Title | Sponsor | Status |
|---|---|---|---|
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HB1028
· 5 mentions in chapter, agenda, transcript
Matched: “HB1028 Cavenaugh TO AMEND THE LAW TO EXTEND THE TIME PERIOD AUTHOR…”
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TO AMEND THE LAW TO EXTEND THE TIME PERIOD AUTHORIZED FOR THE REGISTRATION OF A … | Cavenaugh | Died in Senate Committee at Sine Die adjournment. |
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on our infrastructure and on our economic development. But some of the issues we dealt with last year, these are changing times. Can you hear me, all right, committee? I'm trying not to break the rule with my mask. So these are changing times. So we had some different items come before this committee last year, such as autonomous vehicles, a pilot program. We're going to hear some more about that this year. Also, platooning our big trucks, saving for 40% on fuel.
That was a new issue that we dealt with last year. Last year, we dealt with highway funding, so the highway department probably won't have much to do with us anymore since they got their money. But anyway, we have several new members on the committee, and we're going to take just a minute and kind of introduce ourselves, and we won't take very long, kind of get some, and then we'll get into the bill that we have on the table. But like I said, I'm Mike Holcomb. I'm, this, I've been, it's my fifth term to serve in the House.
It's my third term to serve as Chairman of Transportation. I'm a former Jefferson County judge, three terms, a quorum court member, retired educator, and police officer, or not police officer, but law enforcement officer. So I have District 10. If you don't know where that's at, that's in southeast Arkansas, parts of Jefferson, Lincoln, Cleveland, Drew, Grant, and counties. And so it's more rural than anything. Actually, the only cities I actually have in my district are Star City and Rising.
So glad to have you here. So, Danny, if you will, take a minute and introduce yourself, and then we'll start over with David Fielding after you, and we'll come down the table
Representative Danny Watson
Unverified
1:47
and start back over here with Representative Ray. Thank you, Mr. Chair, Vice Chair, Danny Watson. background, previously 16 and a half years, safety director at a trucking company. Before that, my previous life, I was a DOT officer with the Arkansas Highway Police. Transportation, needless to say, it should be exciting this year.
Yes, the chairman mentioned the road funding has been completed, thank goodness. But anyway, that's behind us. So looking forward to us and reiterate economic development. but my goodness, how important is this? It's time to get with the program. So again, we have a lot of new members and looking forward to it. This is my third time to be elected, second time on transportation, and it's my privilege to serve all the men and women on here. Thank y'all.
David Feld
Unverified
2:40
My name is David Feld and I'm representing District 5. District 5 consists of four counties in Southwest Arkansas, Lafayette County, Nevada County, Washtenaw County, and Columbia County where I live in Magnolia. This is my fifth, sixth, seventh, sixth, I've been home ever since 2011. Somehow I just can't get away from transportation. Thank you. Hi, I'm Representative David Whitaker.
Representative David Whitaker
Unverified
3:11
I represent District 85, which is portions of the city of Fayetteville and Prairie Grove and all of the city of Farmington. This is, I am serving my fifth term, and this will be my third term on transportation. They tried to keep me away, but
Representative David Hillman
Unverified
3:31
I keep coming back. I'm David Hillman, I represent District 13, which is almost all of Prairie County, part of Arkansas, White, and Long Oak Counties. This is my fifth term and my fifth term on the Transportation Committee.
And if it wasn't for David Fielding, David Whitaker and I would be the senior members, but David Fielding. And so we've got two more Davids on here now. So if you want
Representative Dwight Tosh
Unverified
4:02
something, just holler, David. Good to be with you. I'm Representative Dwight Tosh. I represent parts of Craighead County, Poinsett County, Jackson County, and Independence County. I'm currently serving in my fourth term here in the House of Representatives, and it's a great honor for me.
Prior to being elected to the House of Representatives, I was in retirement for a while. I retired after 37 years with the Arkansas State Police, where I retired as the last 17 years of my career. I was a troop commander at Newport. So, I love that. I love being a representative. I love serving the people of Arkansas. Thank
Representative David Ray
Unverified
4:42
you. Good afternoon. I'm Representative David Ray. I represent District 40, which is the northern part of Pulaski County and southern part of Faulkner County.
I'm a freshman. I'm the fourth of the five Davids on this committee. And prior to being elected, I was Chief of Staff to Lieutenant Governor Griffin for several years. I don't have any background specifically in transportation other than as a driver, but I'm excited to be here.
Chair
Unverified
5:14
Thank you. I'm David Tollett. This is my first year in the legislators or legislate body.
And like I said, I don't have a background in transportation. My background is in education. I'm current superintendent at Barton School District, and I know what the roads are like between ballgames, but it's an honor to be here to learn more about transportation and how we can best support it moving forward. I know that I have a lot of friends that are huge supporters of the Arkansas State Police,
and I am too, and we appreciate everything that y'all do. And anyway, I represent District 12, which is Phillips County, Arkansas, Deshaies,
Representative Joy Springer
Unverified
6:10
and Lincoln Counties. Good afternoon. My name is Joy Springer, and I represent District 34. I was the person to replace the late, great Representative John W. Walker. It took me five elections in order to get here for the second time, so I'm happy to be here.
My background is in education and in insurance. However, I will work and do the best I can wherever I am placed.
Representative Denise
Unverified
6:43
Thank you. Good afternoon. My name is Representative Denise Ennett. I represent District 36. I'm next to Representative Springer. We have adjoining districts. I represent parts of Pulaski County.
I live in downtown Little Rock. My district is all of East Little Rock, all the way down to the county line, Grant County line. I don't have any expertise in public transportation, but I'm happy to be here, and I'm happy to learn, and
Speaker 30
7:22
that's it. Thank you. Good afternoon. I'm Harlan Brough. This is my second term right now. I have District 97, which is parts of Carroll County, Madison, and Washington County.
Speaker 31
7:35
And I'm going to do what I can to better my district and the state
Speaker 33
7:47
of Arkansas. I enjoy every part of it. I'm Craig Christensen. I've got District 47, which is part of White County, part of Independence County. most of Jackson County, including Newport and all of Woodruff County. So I have a diverse but very rural district. My transportation background started when I became a district investigator for the state of Arkansas,
way back with the Arkansas Transportation Commission when David Pryor was governor. That goes back a while. Served on a legislative task force for intermodal and commerce and transportation. It's been something I've worked with for the last 1,500 years. I think Noah was selling
Speaker 33
8:25
but It's my second term in the house and second time on transportation and it is an honor to serve and an honor to be here transportation moves America forward
Representative Johnny Rye
Unverified
8:43
Okay, representative Johnny, right? represent a portion of Mississippi and Poinsett counties Uh,
Truman, Blymouth, Oceola areas, uh, this is my third term in office, my third time that I've served on this committee, and the longer I'm here, the more I really find that it's very important, because the roads touch the lives of everyone that's in the state, and just proud
to be here, and, uh, thank you very much for letting me be with you.
Keith Brooks
Unverified
9:17
Thank you, Mr. Chairman. My name is Keith Brooks, and as you can see, as a part of the Front Row Caucus, I'm a new member as well. I represent District 31, which is portions of Pulaski and Saline County. And I don't have any specific experience from the standpoint of transportation outside of. I am an insurance agency owner, and therefore we have lots of discussions on an every single day basis regarding driving, transportation, and any number of matters. But I think from the perspective of economic development, this is an extremely important work. Thank you.
Speaker 40
9:48
Good afternoon. I'm Representative Delia Hawk. I'm the second D in this committee meeting next to
Speaker 42
9:56
Representative Ennett. I live in Northwest Arkansas, District 91, which goes from Pinnacle Hills and Rogers over to the Oklahoma border, includes parts of Bentonville, Rogers, Centerton, Cave Springs, Highfield, Gentry, and Siloam Springs. My husband and I moved here in 1979, and I still live on a dirt road. My district, though, is planes, trains, and automobiles.
I live near the X&A Airport, and I look forward to serving on this committee. Thank you. I'm Representative
Speaker 45
10:31
John Carr, and I represent District 94, which is up in northwest Arkansas. It's in Rogers and a small piece of Bentonville. I have over 20 years of business and technology experience, and I look forward to serving on this committee. Good
Joshua Bryant
Unverified
10:48
afternoon. My name is Joshua Bryant. I am, too, also from Benton County, representing the
eastern one-third of it, primarily throughout Beaver Lake. I've got 12 years experience in the aviation infrastructure world, working for the Federal Aviation Administration, and after that, I own a construction company. So, glad to see all the experience on this body and looking forward to it.
Speaker 48
11:12
Representative Tony Fuhrman from District 28, which is the southern part of Saline County. It's Benton, Haskell, Bauxite. Like a lot of the freshmen here, don't have a ton of experience in transportation other than when I was a football coach,
I drove a school bus sometimes. So it's about as far as it goes. But I'm looking forward to serving with everybody here. Thank you.
Once again, thank you. We're glad you're on the committee. We're going to let me introduce some people that are with us today. If you have any questions from the Highway Department, you've got a handout sheet. It's got all the directors' names on it. You can look at that. But Gil Rogers, would you kind of wave at the crowd? That's Gil Rogers with the Highway Department. If you need to contact anyone with them, I would suggest that you go through him for any questions you have,
and let's coordinate through him. He works real well with us. We also have Colonel Bill Bryant, the director of the State
Speaker 2
12:04
Police, with us. Colonel Bryant, glad to have you. You have a couple of puny fellows with you. Would you introduce those little bitty guys
Speaker 52
12:10
to us? Yes, Mr. Chairman. This is Forrest Marks. He's a major in the highway patrol division for the western part of the state. This is Major Jason Airman of the highway patrol division. He has the eastern part of the state. And we work well with the transformation committee. These are our future leaders, but the same place. So we want to give you experience up here and testify for the transformation.
Thank you, gentlemen. Glad to have you with us today. We also have Charlie Collins, who's the Deputy Director and Commissioner of Revenue, former representative. Charlie, glad to have you back. And we also have Ms. Cassandra Caldwell, who is the Director of the Arkansas Waterways Commission. So if you have any questions from her. Did I miss any one? Okay, just a few. I'm going to take just a few minutes, and I would ask you to listen with me for just a second. I would ask you to raise your hand if you have questions.
after a presenter or when she's presenting. If you have questions, raise your hand. And Mrs. Stella Smith, who is our staff, will take your name in the order that you raise your hand, and we'll call you in
order. I will respond to you, and usually, if you want a follow-up, please ask for a follow-up question. If we have lots of questions on the table, I'll say we'll get back to you for your third question. We'll take some of the other questions, and if time allows, we'll get back to you. So that's usually the way we try to do it.
It works best for us. Please listen to the questions that the presenter, that the questions that are asked to the presenter so that we don't ask the same questions over and
over again. And let me tell you this. We're not all going to agree on the bills every time, but just because someone disagrees with you on a bill does not mean that they don't like you or they're against you. We just have a different opinion, and we represent different parts of Arkansas, all and sometimes some bills work for parts of your state does not work for other parts so let's
not get argumented we'll give everybody an opportunity to speak and we're gonna we're gonna follow the rules and we're gonna be as professional as possible and if there's any any time you need to talk to me I'll give you my phone number you can call me you can talk to me about any issues any bills that concern you I'll be glad to visit with you at any time speaking of rules i'm going to recognize uh recognize miss uh smith mr stella smith uh she will she's going to go over the rules with the committee and kind of uh give you a there's been some rule changes
this year and some of them are minor but for those of us that have been doing the rules the same way uh it's like trying to you know i've got a horse that knows about six tricks and i can teach him a seventh trick and he'll learn it but he'll forget one of the other six tricks so that's kind of way we are here, maybe in this. So we're going to
ask her to explain some of those rules to us and you be attentive for just a minute. Ms. Smith. Thank you, Mr. Chairman.
Speaker 57
15:12
That'll help. How's that? Better? Thank you. Some of the changes that you will notice this session, specifically that deals with our agenda. There will be three headings on an agenda, although we only have one today. You'll have a regular agenda, which will be those bills that the chair has determined will be considered during today's meeting. So the chair will put only the number of bills
that he thinks the committee can't handle that day. And if the committee finishes the agenda, the regular agenda, then the chair can go to the consent agenda, which is the second agenda heading. The consent agenda consists of those bills that the sponsor believes will not be controversial or has no opposition, maybe from the public. So they don't know that anyone will come to speak against his or her bill.
So once they tell the chair that they think there's no opposition, that bill will go under consent agenda. And then you will have a deferred agenda. A deferred agenda, bills on the deferred agenda may be a bill that the sponsor has requested that the chair move to deferred. or it could fall into a category such as if the sponsor is not present to present his or her bill on today, for example.
If Representative Kavanaugh was not here to present her bill, then it would move to the referred list. And Representative Kavanaugh would have to, again, contact Chairman Holcomb to have her bill put back on the regular agenda. In addition, if a sponsor or his or her designee fails to show up to run a bill three times, then it will also move back to referred. The referred category, which you will not see on the printed agenda, but you'll see it online,
the referred agenda consists of all bills that have been filed and referred to Transportation Committee, for example. It is the sponsor or the primary sponsor's responsibility to contact Chairman Holcomb regarding getting your bill on the agenda. Once Representative Holcomb comes up with his list of bills, then he'll contact me and let me know what category to put each bill in.
So for today's agenda, you notice we only have one bill, and that falls under regular agenda. We have three bills that have been referred to the committee, so the other two bills will be under-referred. I don't want to forget anything. Agendas will be posted 18 hours prior to the meeting. 18 hours prior to the meeting is actually, if you're meeting at 10 o'clock, well, we're meeting at 2.
So our deadline is 8 p.m. for a 2 p.m. meeting the next day. But the Bureau's policy is to post agendas two days in advance. So we always meet that 18-hour deadline. Now, you may see our agenda says that it's been revised. Originally, our agenda that was on the website, organizational meeting only, And then we did revise it to add Representative Kavanaugh's bill to the agenda.
But you'll notice it says revised, but it also has a date. Because of the 18-hour rule, we want to keep the public informed. And it also indicates why the agenda was revised to add a bill. There's always a sign-up sheet on the outside of the committee room for the public. anyone wishing to speak for or against the bill, but now we also have online sign-in sheet.
That closes two hours prior to the start of the committee meeting. So at 12 o'clock, if anyone had signed up online to speak, then I would have been sent that sign-up sheet. But also to give the public an opportunity to be heard, that's why we have a physical sign-up sheet outside the committee room and as you know each committee is limited in space so we have a committee holding room which is right down the hall which used to be like the break room but there are vending
machines there if you'd like to get something you all probably already know that members can participate remotely and you probably have been advised of how you can do that But, again, once again, I think that the big thing is that the sponsor must be in contact with the committee chair to get your bill or bills on the committee agenda.
That's it. Excuse me. Representative Kavanaugh, are you ready to run House Bill 1028? Okay.
You're recognized to run your bill, present your
Representative Frances Cavenaugh
Unverified
21:05
bill. Thank you, Mr. Chairman. Thank you, committee. I'm going to present bill HB 1028. Can everybody hear me without me taking off my mask? Okay.
Representative Frances Cavenaugh
Unverified
21:28
So this is, this bill is just a simple change in the time period
that a consumer has to license their vehicle. Current law says 30 days. This has taken it to 60 days. I've had people ask me, why would I want to do this? Well, the biggest reason is next to the home, automobile is the biggest purchase that a consumer will purchase. Now, a lot of times,
middle to lower income Arkansans don't have the ability to pay that sales tax in that 30 days. it's too much of a burden on them. So 60 days would allow them another 30 days to be able to pay that sales tax without a penalty charge to them, without them getting a ticket for driving on expired tags and any number of issues that happens with not paying that fee, those taxes in those 30 days. That is really all that the bill actually does. Now, you'll see that you've had a physical impact that shows that we're going to have approximately a $38 million loss of
revenue. That is not a loss of revenue. That is a shifting of revenue. There is no change in the tax rate on licensing these vehicles. It is only saying that instead of paying it in 30 days, you're going to pay it in 60 days. So even though they may show that they're not going to collect this money in one fiscal year. In the very next month of that fiscal year, they're going to collect it. So it's just a shifting of 30 days. And actually in the latest one they sent us, the
fiscal impact, it does actually say this is a one-time reduction, but it's not a reduction or a shift in revenue. And that's exactly what it is. It is a shift in the revenue when it is collected. The state will collect all the taxes that it is due. It will just collect it 30 days later. And I would take any questions. Thank you, Mr. Chair.
Representative Dwight Tosh
Unverified
23:31
Yes, I've got a question. Representative Kavanaugh, I really like your bill, and I like what you're trying to do with it.
My question is, you know, I was just curious why you didn't include in the bill, you know, a trade-in. And if you want to trade a vehicle in, I think you've got 45 days to be able to do that and get credit for it. Is that correct? I believe that is correct. I think that is correct. And I guess what I was curious about just to, like I said, I like what you're doing extending this from 30 to 60 days, and I'm in favor of that. But I also thought it would have been a good idea if on a trade-in we get credit for the sales tax.
I know that causes a lot of confusion with the buyers out here. And if we made that also 60 days, which I think 45 days, I know sometimes it gets kind of difficult for some of them to be able to sell their vehicle and get credit for it. Have you thought about maybe adding that into your bill and making both of them 60 days so there's less confusion with the... I think that's going to be another part
Representative Frances Cavenaugh
Unverified
24:40
of the statute. It's not necessarily going to be this part of the statute, is what I understood.
But I'm willing to do that, too. I can run a bill that will do that. I don't have any trouble. I think that's an excellent idea. Because as a car dealer, we run into that all the time with consumers. Because it is confusing from when they can get that credit. Because they're told to license it in 30 days, but they can get a credit for 45 days. So it does get a little confusing. And it may be something, I know there's some other bills being ran to exempt
the amount of sales tax on a vehicle. That might be able to be put in there also.
Representative Dwight Tosh
Unverified
25:17
Okay, follow up, Mr. Chair. Follow up. Okay, and I agree with you, and I appreciate you looking into that. I really do think it's a great idea, and I think we can keep them both on 60 days. I think it just helps the citizens out here and just provides less confusion in what they need to do and when they need to do it. So I appreciate you following up on that. Thank you,
Representative Kavanaugh, for bringing this bill. Representative Varie,
Representative Johnny Rye
Unverified
25:42
are you recognized for a question? Yes, sir. Thank you. Representative Fran, for this to be 60 days instead of 30 days,
in most cases, like with a new car, that 60 days instead of 30 days is actually what is kind of dragging this revenue just a little longer. Isn't that right? Yes, because you're
Representative Frances Cavenaugh
Unverified
26:01
changing when they're actually going to collect it, not the amount they're going
to collect, but when they're going to collect it. Currently, they collect it at 30 days. This would allow the consumer an additional 30 days to pay it, so they would collect it after 60 days, not 30 days. It's just a shifting of revenue.
Any other questions for committee? Representative Toilette.
Speaker 23
26:26
Thank you, Mr. Chair. after 30 days is there currently a penalty and
Chair
Unverified
26:32
by extending it to 60 days how much revenue will that cut between what is being paid out currently in the penalties versus extending out to 60 days with i mean what i would assume people not paying
Speaker 22
26:48
that out in penalties i don't know what the the
Representative Frances Cavenaugh
Unverified
26:54
number of penalties that consumers pay. I don't know if D of an A could actually provide that, but the way I look at it, that's more money in Arkansans' pockets where they don't have to pay that penalty to the
Speaker 79
27:13
state. Any other questions from committee members? Okay. I think we have someone here to speak against that. Let me
get, Paul Gehring. Paul, would you come up and introduce yourself to the committee, please?
And Charlie Collins also will be speaking against. Thank you, Mr.
Representative Fred Allen
Unverified
27:38
Chair. You may proceed. Thank you, Mr. Chair. Members of the committee, Paul Gehring,
Speaker 87
27:46
Department of Finance Administration. I'm Charlie Collins,
Representative Fred Allen
Unverified
27:51
the Commissioner of Revenue. Thank you, Mr. Chair. DFA prepared a fiscal impact statement for House Bill 1028. We do not
disagree that this is a one-time shift in revenue from fiscal year 2022 to fiscal year 2023. three. The issue is, is that when we move the due date for a payment of your sales tax and your registration fees, those are going to be collected in the next fiscal year. So what we will have to do is we will have to account for in the FY22 budget, this loss to sales tax to, that includes
the city and county sales tax, as well as those registration fees. So I did also want to make a clarification. We did notice in our fiscal impact statement that was released yesterday with regards to the fund changes that are included in sales tax, the number that we had for general revenue for FY 2023 was indicated as being a negative 3.9. It was actually should have been a positive 3.9. We noticed that this morning created a new amended fiscal impact statement,
provided that to Representative Kavanaugh as well as to BLR so that could be posted to the website. We apologize for that error. I did have an opportunity to speak with Representative Kavanaugh earlier today to answer any questions regarding the fiscal impact statement. We have been instructed by the Governor's Office to speak against the bill for the purposes of the impact to the FY22 budget that would be contemplated by this bill.
Committee, anyone, any of the committee members have a question for Mr. Gehring? You recognize
Representative David Ray
Unverified
29:42
Representative Frank? Yes, Mr. Gehring. Would it be fair to say that because many drivers would go ahead and pay the fees and sales tax prior to the extended deadline, not everyone would, in other words, not everyone would take advantage of the extended deadline, that the revenue impact, therefore, would end up
being considerably less in terms of the shift than what this estimate projects. Would you agree with that? Thank you,
Representative Fred Allen
Unverified
30:12
Representative. As stated in our fiscal impact statement, the impact assumed that all the individuals would be paying after the 30-day period had lapsed and expanded into the next fiscal year, we will not know what the actual revenue impact would be until after the bill became effective and we actually saw how individual behavior was changed. We certainly would,
there would be, we would make sure that the taxpayer community was aware of this change as well as our office staff, but we cannot estimate who would actually extend the period of time that would pay it within the 30 days versus the new additional 30-day period. So certainly the revenue impact could be different depending upon what occurs in the future. You recognize for follow-up? And
Representative David Ray
Unverified
31:06
can you please clarify what is the penalty currently for missing the deadline? The late
Representative Fred Allen
Unverified
31:12
registration penalty, I would have to get the exact number. Right now, because of COVID-19, We have suspended the late registration penalty pursuant to the emergency. But I would be happy to go back and look and see exactly what we have collected in non-pandemic times and the amount of the penalty that we currently assess for late registration and late payment of
Speaker 94
31:32
sales tax. Any other questions for Mr. Ging?
Mr. Rye, you recognize Representative Rye? Yes, sir. Thank you, Mr. Chairman.
Representative Johnny Rye
Unverified
31:43
Paul, actually, on the front end of this, I have two questions. One, when will, if this bill passes and becomes law, when would this start? And then, number two, would this just affect the first year that it begins? Representative Rye, for the purposes of the fiscal impact statement,
Speaker 95
32:02
we assumed an ineffective date. Paul, pull the mic a little closer, will you,
Speaker 96
32:08
please? Sure. Representative Rye, for purposes
Representative Fred Allen
Unverified
32:10
of the fiscal impact statement, because there was not an effective
date, we assumed that the effective date would be on or about July 1 of 2021. So that's when we would start seeing that the due date for registration and payment of sales tax would begin. The issue, how that occurs is that those individuals in June of 2022 that would ordinarily under existing law, pay their sales tax and their registration fees in that June, which would be the last month of the FY 2022 fiscal year, are actually going to be paying those registration fees and
sales tax in the next fiscal year. So that is how we derived our revenue impact. Did you
Speaker 97
32:59
have a follow-up, Representative Ryan? Is that it? So actually,
Representative Johnny Rye
Unverified
33:04
if you count this the way that you're talking about, Paul, which is a fiscal year starting in July of each year, you would be a little late on that revenue coming in for July. But the following July of 22, we shouldn't see any change much by that point.
Representative Fred Allen
Unverified
33:23
Isn't that right? That's right. In FY 2023, our revenue impact was neutral because you're still going to be collecting the approximate $450 million in sales tax on motor vehicle registrations. The issue that comes up with is that if you are extending that 30-day period in FY 2022, those are taxes and registration fees that would not get collected in FY 2022. And the only way that you would ever could account for that one month that was extended
is to sometime in the future, the General Assembly collapse that 60 days back to 30 days. You're still going to collect all of the sales tax and registration fees on these vehicles that are purchased. We don't disagree with that, but we have to make sure that we point out that if we extend the time period to register your vehicle and pay your sales tax in FY 2022, there's going to be a month, and we typically collect about $38 million a month in sales tax, that we anticipate that would be collected in a different fiscal year.
Any other questions from committee members? Representative
Representative David Ray
Unverified
34:36
Rake. Yes, Mr. Gehring, do you have any estimate of either the number of Arkansans or the percentage of new vehicle purchases where people fail to meet the deadline, the 30-day deadline? Representative, we can certainly
Representative Fred Allen
Unverified
34:51
get that information. We do have a provision in Arkansas law that an individual can sign an affidavit that says that they did not operate that motor
vehicle after that 30-day period, and they do not pay a late registration penalty. But we would be happy to get that information about some prior years that were not COVID years to just to give the committee an idea of how many people are paying after the 30-day period. Any other questions from committee members?
Representative Tosh, you recognize? Thank you, Mr. Chair. I guess the
Representative Dwight Tosh
Unverified
35:27
bottom line is, and you correct me if I'm wrong, bottom line is it's really not going to be any loss of
revenue to the state of Arkansas. It's just going to be, you know, later than sooner. But we're actually, would you agree with me that what we're trying to put into law here is something that would help the citizens of the state? Because I know citizens that have experienced an issue where they only had 30 days and they tried to get a lien out of another state where they had a lien in another state and get their title. Sometimes that would take a lot longer than 30 days. I think this is just something to make it more convenient for the citizens. And I know you're worried about
the revenue on the front end, but I think it'll make it up on the
Representative Fred Allen
Unverified
36:16
back end. Would you agree with that assessment? And thank you, Representative Tasha. We certainly, DFA certainly does not disagree that these taxes are going to be collected and these registration fees are going to be collected. But by shifting the deadline to register the vehicle, that first year of implementation of this new law, it would cause a revenue impact to FY 2022. In terms of the administrative changes contemplated by the bill, we have no objection. The only purposes of DFA speaking
against this bill is because of the DFA would have to account for in the budget, the revenue
Speaker 94
36:53
loss. I think Commissioner Collins had a
Speaker 87
36:56
comment also. thank you Mr. Chairman thank you Representative Tosh it's good to see you my friend so the way I think about it sir is we normally collect 12 months a year of car taxes each car tax is about 38 million in the fiscal year this goes into play we will only collect 11 months so that's the
budget will be negatively impacted by about 38 million dollars the next year we will collect 12 months, the next year, 12, 12, 12, out into the future. So it is not a recurring one month loss, but it is a real one month loss, one time in terms of the budget, because we'll never make that up unless the legislature moves it back to 30 days and we get a double month collection in the future, or we stop selling cars in Arkansas and actually go two months from there and kind
to collect at that point. Thank you, sir. Okay. Representative Ennett,
Representative Denise
Unverified
38:05
you're next on the list for a question. Thank you, Mr. Chair. I would like to know what the penalties are, like what Representative Ray was mentioning. How soon can
Representative Fred Allen
Unverified
38:13
you get those numbers to us? Thank you, Representative. We'll be happy to get that information this afternoon. Well, our members of our excise tax section as well as our motor vehicle section are streaming
this committee meeting as well, and so they're taking very specific notes on the information that are requested by the members, and we'll be happy to get the amount of penalties that have been paid, the number of taxpayers affected, and how much that Arkansas law currently assesses for
Chair
Unverified
38:43
the late registration of a motor vehicle. Representative Talley, you're recognized. So just to go back to something that you said, you said that during the COVID pandemic that the 30-day penalty is already nullified or it's not in existence right now currently, correct?
Representative Fred Allen
Unverified
39:00
That's correct. The late registration penalty in Arkansas law has been suspended by DFA under its authority, under the governor's executive orders. This is a change that we made in the spring of 2020. A big issue was to respond to the fear of individuals from coming to the revenue offices to register their vehicle in very uncertain times. We have suspended that late registration penalty. We are not collecting it as of, I believe, last April.
Speaker 87
39:33
Mr. Chairman, if I could add to that, We are still collecting the late penalty for late sales tax, and that's a more substantial number than the late penalty for registration. Off the top of my head, and we're going to double-check this, I believe it's 10%, but I'm not positive it's 10% of the sales tax for late penalty. I also want to make clear that our fiscal impact is not driven by the late fees, etc. It's much more in tune with this idea that we collect our car sales tax over 12 months.
Each month is about $38 million, and if we only collect 11 months, then that's $38 million we won't collect. These other questions obviously are very important about late fees, etc., but the fiscal impact and the budget impact we're talking about is much more influenced by that overall one-month loss of revenue. Representative Springer, you're recognized for
a question. Thank you, Mr. Chair. Appropriate
Representative Joy Springer
Unverified
40:31
motion at the proper time, sir. Okay, we have a couple more
Speaker 97
40:36
questions on the table. Representative Whitaker, you're going to ask for a question.
Representative David Whitaker
Unverified
40:41
Thank you, Mr. Chair. Paul, just to clarify, just to, if nothing else, just to restate it. So the idea is that no matter what the timing of this, if we were ever to go from 30 to 60, we would suffer a one month. Is that correct? That is correct, Representative Whitaker. So it doesn't have anything
Representative Fred Allen
Unverified
41:04
to do with when it goes into effect. Yes. As Commissioner Collins just recently pointed out, if you extend the 30 days to 60 days, in that fiscal year that it goes into effect, you are going to be collecting 11 months of sales tax and registration fees for that given fiscal year.
And in the following years, following fiscal years, you're going to be collecting 12 months for every year. But that first initial year is where we are going to experience that hit to
the budget. Thank you. Any other question from committee? Representative Kavanaugh, are you, well, that's all we had to sign up to speak, Paul, are you and Charlie, you all have anything else to add before we get? No, Mr. Chair, thank you. Okay. Representative Kavanaugh, you want to close for your bill?
Representative Frances Cavenaugh
Unverified
41:50
Yes, thank you, Mr. Chair. This is just a simple bill to give those Arkansans a break on when they can pay their sales tax to allow them to overcome burden that most middle-class and low-income Arkansans have when they're purchasing an automobile. This is just a shift of when revenue is collected. The state of Arkansas loses not one dime. We do lose penalties of 10% that we're charging customers or Arkansans now
because they can't pay that sales tax in 30 days. And this is just a good bill to help Arkansans to be able to keep more money in their pocket and to allow them the ability to actually drive their car, not get a fine, because if they're getting a penalty for not assessing it, most of the time they're getting a fine for driving on expired tags. And so
this is just a good bill for Arkansans to help them out, and I would appreciate a good
vote. Thank you. Thank you, Representative Kavanaugh. Representative Springer, you recognize?
Representative Frances Cavenaugh
Unverified
42:53
Motion do pass, sir. I have a motion do pass. Any discussion? All in favor, say aye. Aye. All opposed, same like sign. Congratulations, Representative Kevin O, your bill passes. Thank you, committee. That's all we have before the committee today. Any announcements, Ms. Steele, or anything? Just about the mics. We've got
Speaker 60
43:20
more than two on. Okay, just remember about your mics. We get feedback if we have more than two on, so when you speak or don't speak.
Unknown speaker
43:26
Thank you, committee. Appreciate your time. Thank you.
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Agenda
REGULAR AGENDA Number Sponsor Subtitle
HB1028 Cavenaugh TO AMEND THE LAW TO EXTEND THE TIME PERIOD AUTHORIZED FOR THE
REGISTRATION OF A MOTOR VEHICLE; AND TO AMEND THE LAW CONCERNING TEMPORARY PREPRINTED PAPER BUYER'S TAGS.
Documents
| Title | Type | Pages | Source |
|---|---|---|---|
| Agenda — PUBLIC TRANSPORTATION- HOUSE, Jan 19, 2021 | Agenda | 1 | Official source ↗ |
Speakers
Representative Mike Holcomb Chair
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Representative Danny Watson
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David Feld
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Representative David Whitaker
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Representative David Hillman
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Representative Dwight Tosh
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Representative David Ray
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Chair
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Representative Joy Springer
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Representative Denise
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Speaker 31
Speaker 33
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Representative Johnny Rye
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Keith Brooks
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Joshua Bryant
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Speaker 2
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Representative Frances Cavenaugh
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Speaker 68
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Representative Fred Allen
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Speaker 87
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