Legislative Analysis
Phone: (517) 373-8080
EXTENSION OF SUNSET ON FEES DIRECTED TO THE
http://www.house.mi.gov/hfa
TRANSPORTATION ADMINISTRATION COLLECTION FUND
AND OTHER FUNDS Analysis available at
http://www.legislature.mi.gov
House Bill 4990 (H-2)
House Bill 4991 (H-1)
Sponsor: Rep. Felicia Brabec
Committee: Appropriations
Complete to 9-19-23
SUMMARY:
House Bills 4990 and 4991 would amend the Michigan Vehicle Code and the State Personal
Identification Card Act, respectively, to maintain regulatory and service fees levied on various
vehicle registration, title, and record look-up service transactions by extending the sunset
(expiration date) of the fees for four years, from October 1, 2023, to October 1, 2027.
All but two of the fees extended in the bills are directed to the Transportation Administration
Collection Fund (TACF). TACF was created under 2003 PA 152 to support operations and
activities in administering sections 801 through 810 of the Michigan Vehicle Code, which
govern state registration of vehicles and watercraft, and its related services. Additional service
fees were created or directed to be deposited into TACF in subsequent years to cover DOS
administrative funding shortfalls, which were being supported with GF/GP appropriations. In
following years, TACF revenue also began to be used for necessary department administrative
expenses other than those associated with its motor vehicle registration program, as authorized
by statute. In the FY 2023-24 DOS budget, $153.5 million is appropriated from TACF, or 55%
of the department’s total budget.
Record Look-Up Fees
House Bills 4990 and 4991 would extend the sunset on and raise fees for DOS record look-up
services for motor vehicles. DOS is authorized by statute to charge a fee for record look-up
services at the market rate or at an amount determined by the legislature. The legislature sets
the amount each fiscal year in boilerplate in the General Government appropriations act. The
legislature has set the fee at $11 per record look-up since the start of FY 2016-17. The fee was
raised $3 in FY 2016-17 from $8 to support costs of developing the department's vehicle and
driver computer system, Customer and Automotive Records System (CARS). 2005 PAs 172,
173, and 174 directed record look-up fee revenue to TACF to further address the revenue
shortfall in supporting the department’s administrative costs and use of GF/GP to cover these
costs.
Other changes included in HB 4990 are striking vehicle registration rates no longer in effect
after December 31, 2016, and eliminating the $100 cap on certain civil fines for not providing
required information.
The TACF fees sunset date was most recently extended four years, from October 1, 2019 to
October 1, 2023, by 2019 PAs 80, 81, and 88.
House Fiscal Agency Page 1 of 6
 Traffic Law Enforcement and Safety Fund
House Bill 4990 would extend the sunset on two regulatory fees that are deposited into funds
other than TACF. The first is a vehicle registration transaction fee that is directed to the Traffic
Law Enforcement and Safety Fund (TLESF). TLESF supports the Michigan State Police
(MSP) in the enforcement of traffic laws and the ability to provide safety on state roads and
highways. TLESF was established in 2003 PA 152 and collects fee revenue from multiple
sources. HB 4990 would extend a $2.25 earmark collected from vehicle registration taxes
provided for in section 801 of the Michigan Vehicle Code to October 31, 2027. The fee sunset
was last extended in 2019 to October 31, 2023.
Scrap Tire Regulatory Fund
The other fee not deposited into TACF is the tire disposal surcharge authorized under section
806 of the Michigan Vehicle Code. The bill would extend the December 31, 2023 sunset on
the fee to December 31, 2027. The tire disposal surcharge is paid by each person who applies
for a certificate of title, a salvage vehicle certificate of title, or a scrap certificate of title. This
surcharge is collected by the Department of Environment, Great Lakes, and Energy (EGLE)
and credited to the Scrap Tire Regulatory Fund. Revenue from this fund supports EGLE’s
Scrap Tire Grants and Scrap Tire Regulatory Program, which fund the removal of scrap tires
from public lands and enforce the Scrap Tire Regulatory Act. The surcharge was set at $1.50
per title or duplicate title in 2003. The surcharge sunset was last extended in 2019 to December
31, 2023.
MCL 257.208b et seq. (HB 4990)
MCL 28.297 (HB 4991)
FISCAL IMPACT:
Sunset Extension
Extension of the fee sunsets would sustain revenues that support current funding levels by
permitting the continued expenditure of fee revenue beyond October 1, 2023 for DOS and MSP
and beyond December 31 2023 for EGLE. The FY 2023-24 budgets for each of these
departments assume the availability of revenue from these fees. If authorization to expend the
fee revenue expires, departments would need to request alternative funding sources to offset
the decreases or reduce department operations. Without the bills, DOS would be authorized to
collect only $2.2 million of the approximately $131.2 million in annual fee revenues. The
remaining $2.2 million in fee revenue is authorized under various other sections of the
Michigan Vehicle Code and is not subject to a fee sunset. These revenues are shown separately
in Figure 1. All TACF revenue is directed by statute to DOS for vehicle and driver related
operations.
If the fee revenue was no longer authorized for DOS to expend, approximately $51.0 million
of record look-up fee revenue annually would be deposited to the general fund instead of to
TACF, and most vehicle registration fee revenue would go to the Michigan Transportation
Fund, which is distributed to the state and local units of government for road construction and
maintenance.
House Fiscal Agency HBs 4990 (H-2) and 4991 (H-1) Page 2 of 6
 Traffic Law Enforcement and Safety Fund
Of every $8 vehicle registration transaction service fee collected, $2.25 is deposited into
TLESF. Revenue to TLESF is primarily expended for the enforcement of traffic laws by at-
post state troopers. The total annualized revenue maintained by the elimination of the fee sunset
under the bill would be approximately $17.5 million. The enacted FY 2023-24 MSP budget
assumes the availability of registration fee revenue to TLESF.
Scrap Tire Regulatory Fund
Revenue collected under the tire disposal surcharge generated $4.0 million in revenue in FY
2021-22 and is projected to continue at similar levels in future fiscal years. The enacted FY
2023-24 EGLE budget assumes the availability of surcharge revenue to the fund.
Increase to Record Look-Up Fee and TACF Revenue
The bills would also increase revenue to the TACF by approximately $18.5 million annually
by increasing the fee for record look-up services from $11.00 to $15.00. This revenue increase
would help align annual TACF revenue with ongoing budgeted expenditures to prevent future
revenue shortfalls. Increasing costs to the secretary of state and steady revenue have led to
expenditures annually exceeding revenue, resulting in a regularly anticipated future revenue
shortfall. To address this imbalance, the legislature has appropriated one-time funding
increases for three consecutive years, with $18.0 million being transferred from the
Comprehensive Transportation Fund in FY 2020-21, $18.0 million GF/GP in FY 2021-22, and
$19.0 million GF/GP in FY 2022-23. The $4.00 fee increase would provide ongoing restricted
fund revenue to eliminate the need for one-time increases.
Without the $4.00 fee increase, inflationary adjustments, or any additional one-time funding
increase, annual outspending of revenue would result in an estimated revenue shortfall for DOS
of $10.8 million by FY 2024-25 and $40.3 million by FY 2025-26.
In FY 2023-24, DOS anticipates the collection and deposit of approximately $130.0 million
into TACF. The FY 2023-24 enacted budget appropriates $153.5 million from TACF. The
enacted budget assumes the use of a balance in the fund carried forward from previous fiscal
years. Due to prior year one-time funding increases, a carry forward balance in the fund of over
$30.0 million is anticipated at the close of FY 2022-23. Figure 2 below shows past and
forecasted TACF revenue collections and expenditures.
Look-Up Fees in the Natural Resources and Environmental Protection Act (NREPA)
Three types of record look-up fees are authorized under NREPA. These fees are for look-
up services for watercraft, off-road vehicles, and snowmobile records. HB 5007 would
make the same changes to those record look-up fees in NREPA as HBs 4990 and 4991.
This legislative and fiscal analysis for HBs 4990 and 4991 includes the changes in HB
5007 for record look-up fees only. For a summary and fiscal impact of all other changes in
HB 5007, please refer to the House Fiscal Agency legislative and fiscal analysis for HB
5007.
Figure 1 below provides a summary of fee revenue per transaction, total revenue collected in
FY 2021-22 and the corresponding authorization.
House Fiscal Agency HBs 4990 (H-2) and 4991 (H-1) Page 3 of 6
 Figure 1: Summary of Fees, Revenue, and Authorization
FY 2021-22
Fee Service MCL Fee Amount
Total Revenue
Amateur Radio Operator
257.217a $2 $300
Registration Plate
Bulk Driver, Vehicle List
257.232 $25 $1.6 million
Sales
Veteran/Military Registration
257.803r $5 $88,100
Plates
Half-Year Commercial
257.802 $10
Vehicle Registration
Inter-State Special
257.802(3) $10
Registration
Temp Registration Plates and
257.802(4) $5
Markers
30 and 60 Permits 257.802(5) $10
Repo, Delivery, and Auction
257.802(6) $40/$20
Temp Registration
$1.9 million
Special Mobile Equipment
257.802(7) $15/$5
Registration
3-Month Tractor Truck
257.802(8) $10
Registration
12-Month Farm Truck &
257.802(9) $20
Trailer Registration
Farm Tractor Registration 257.802(11) $10
3-Month Tractor Truck
257.802(12) $10
Registration
Registration Transaction 257.801 $5.75 $44.6 million
$17.5 million (Dedicated
257.801
Registration Transaction $2.25 to TLESF and MSP)
Personalized Registration
257.803b $8/$2/$5/$15
Plate $3.0 million
Duplicate Title and Expedited
257.803b $8/$2/$5
Service
Commemorative/Fund-
raising, Special Organization 257.804 $5/$10 $3.9 million
Registration Plates
Replacement Plate 257.804 $5/$10 $1.5 million
Vehicle Title Service Fee 257.806 $3 $9.1 million
Expeditious Title Service Fee 257.806 $5 $2.8 million
House Fiscal Agency HBs 4990 (H-2) and 4991 (H-1) Page 4 of 6
 $4.0 million
Salvage & Scrap Vehicle (Dedicated to Scrap Tire
257.806(3)
Title Tire Disposal Surcharge $1.50 Regulatory Fund and
EGLE)
Registration Transfer 257.809 $10 $9.4 million
Subtotal $99.4 million
Fees Without Sunsets
Half of License
Dealer License Late Fees 257.248(9) $8,400
Fee
Lienholder Title Fees 257.808 $1 $1.1 million
Fundraising Plate Service
257.811h $10 $376,800
Fees
Nonpayment of Check
257.801a $20-$60+ $436,800
Penalty
Sample Plate Service Fee 257.811g $10 $4,100
Plate Hold Fee 257.227a $25 $274,700
Subtotal $2.2 million
Record Look-Up Fees
Revenue
Current
Fee Service MCL House Bill w/Fee
Revenue
Increase
Personal ID Records Look-Up 28.297 4991
Commercial Records Look-
257.208b 4990 $71.1
Up Service
million
Watercraft Title Records $52.6
324.80315 ($18.5
Look-Up million
million
ORV Records Look-Up 324.81114 5007 increase)
Snowmobile Records Look-
324.82156
Up
$131.2 $149.7
Grand Total TACF Revenue
million million
House Fiscal Agency HBs 4990 (H-2) and 4991 (H-1) Page 5 of 6
 Figure 2: Comparison of Past and Projected TACF Revenues and Expenditures
Millions
$180.0 $19.0
$18.0 $18.0 $39.6 $39.3
$160.0
$25.5 $159.5
$156.5
$25.6 $21.0 $153.5
$16.4 $149.4
$140.0 $143.4
$146.9 $15.7
$135.1 $136.0 $133.6 $134.5
$131.2 $130.0 $130.0 $130.0 $130.0
$120.0 $126.4
$100.0
$80.0