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MEMORANDUM
TO: BOARD OF SUPERVISORS
FROM: Carol J. Huchingson, County Administrative Officer
DATE: January 10, 2017
SUBJECT: Consideration of Action to Disburse Existing Abandoned Vehicle Funding and to Continue Collection of the $1.00 Abandoned Vehicle Abatement Fee
EXECUTIVE SUMMARY:
Since 1991, the County of Lake and both cities have participated in the Lake County Abandoned Vehicle Abatement Authority which is a joint powers program funded by a $1.00 annual vehicle registration fee, commonly referred to as the AVA fee. There is some question whether the AVA fee is subject to Proposition 26 (2010), which altered the definition of what constitutes a "fee" and resulted in the reclassification of certain fees as taxes that are in turn subject to voter approval. Because of the ambiguous statutory context of Proposition 26, it remains unclear, whether the AVA fee is to be considered a fee or a tax.
The response to the issue has been varied throughout the state. The most common approach taken by jurisdictions is to place the issue on the ballot. A few jurisdictions have rescinded their AVA fee believing that the cost of placing the issue on the ballot would be greater than the benefit derived from the fee. Other jurisdictions have taken the position that Proposition 26 is not applicable and so have continued to collect and disburse the fee.
In Lake County, an approach to address the issue has not been formally addressed either by your Board, the cities or the Commission. Consequently, since 2012 no AVA funding has been distributed to the city and County vehicle abatement programs even though the DMV has continued to collect the $1.00 fee and pass it on to the County, where it has accumulated in a County trust fund.
Currently, there is over $356,000 in that trust fund. Because the funds have not been expended, the State Controller recently ordered the DMV to discontinue collection of the fee for one year beginning January 1, 2017.
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