Relating to flying our colors special registration plates

Description

House File 2620 creates a “Flying Our Colors” license plate and requires the Department of Transportation (DOT) to design the plate. The plate requires two fees, an initial special fee of $35 and an annual special fee of $10. These fees are deposited in the Road Use Tax Fund (RUTF). At the end of each month, the Treasurer of State is required to credit the amount equal to the special fees deposited in the RUTF from the Statutory Allocations Fund (SAF) to the Flood Mitigation Fund. The image to the right is a mockup of the proposed plate provided by the DOT. The Bill also specifies that the initial fee for a personalized plate is $25 and the annual renewal fee for such plate is $5. The fees for personalized plates are not subject to deposit in the Flood Mitigation Fund.

Background

The State of Iowa currently has over 70 types of specialty license plates that citizens may select. Over 221,000 of the 4.5 million vehicles registered in Iowa have specialty plates. The top 16 plate types account for 86.1% of all specialty plates issued in Iowa. The top 16 license plates in Iowa are as listed below. However, there are over 50 types not represented in the data below that have far fewer plates issued.Top 16 Iowa Specialty Plates Blackout 93,634 Business Trade 4,258 University of Iowa 25,617 DNR Pheasant 3,738 Iowa State University 16,740 DNR Deer 3,532 DNR Goldfinch 13,133 God Bless America 3,465 Fire Fighter 11,860 Fallen Peace Officer 2,957 Veteran 9,505 Univ. of Northern Iowa 2,219 Cattleman's 6,426 Breast Cancer 1,463 DNR Eagle 4,600 Share the Road 1,449 Note: Through December 2019.

Assumptions

• An estimated 3,500 “Flying Our Colors” license plates will be issued within two years.
• This would make the plate as popular as the “God Bless America” plate currently issued by the DOT. It is estimated that 1,750 plates will be issued in FY 2021 and 1,750 plates will be issued in FY 2022. Approximately 30.0% of the “Flying Our Colors” plates will be personalized. This is similar to the percentage of other special plates that are personalized.

Fiscal Impact

House File 2620 is estimated to increase revenue to the Flood Mitigation Fund by $61,250 in FY 2021, $70,000 in FY 2022, and $17,500 each year thereafter. The RUTF will fund plate production costs (Iowa Code section 312.2(3)), but expenditure on these plates is expected to be minimal and can only be attributed to implementation of the Bill when individuals prematurely replace a license plate in order to replace it with the new plate.

The cost to produce the new plates is estimated to be $7,400 per year in FY 2021 and FY 2022. The costs will be funded from the RUTF.

Assuming 30.0% of the new plates are personalized, the RUTF will receive an increase in revenue of $13,100 per year in FY 2021 and FY 2022 and $17,500 each year thereafter.

Sources

• Iowa Department of Transportation
• LSA calculations
• s// Holly M. Lyons
• March 25, 2020
• The fiscal note for this Bill was prepared pursuant to Joint Rule 17 and the Iowa Code. Data used in
• developing this fiscal note is available from the Fiscal Services Division of the Legislative Services
• Agency upon request.
• Existing Plates - 1,750 3,500
• New Plates Issued 1,750 1,750 -
• Initial Special Fee 61,250$ 61,250$ -$
• Annual Fee - 17,500 35,000
• RUTF Revenue 61,250$ 78,750$ 35,000$
• SAF Transfer to Flood Mitig. 61,250$ 78,750$ 35,000$
• Note: The SAF balance is transferred to the RUTF at the end of the fiscal year.
• Revenues to the RUTF and transfers from the SAF to the Flood Mitigation Fund w ill
• offset at the end of the fiscal year.