Division of the Budget
Landon State Office Building Phone: (785) 296-2436
900 SW Jackson Street, Room 504 larry.campbell@ks.gov
Topeka, KS 66612 Division of the Budget http://budget.kansas.gov
Larry L. Campbell, Director Laura Kelly, Governor


March 8, 2019


The Honorable Steven Johnson, Chairperson
House Committee on Taxation
Statehouse, Room 185-N
Topeka, Kansas 66612
Dear Representative Johnson:
SUBJECT: Fiscal Note for HB 2381 by House Committee on Taxation
In accordance with KSA 75-3715a, the following fiscal note concerning HB 2381 is
respectfully submitted to your committee.
HB 2381 would increase motor fuel tax rates by $0.06 beginning in FY 2020. The increases
would be as follows:
Current Law FY 2020 & After
Motor-Vehicle Fuels $0.24 $0.30
Special Fuels $0.26 $0.32
LP-Gas $0.23 $0.29
E-85 $0.17 $0.23
Compressed Natural Gas $0.24 $0.30
Liquified Natural Gas $0.26 $0.32
Per gallon

The bill would increase the fee for 24-hour motor fuel permits from $13.00 to $16.00 for
FY 2020 and beyond. The fee for 72-hour motor fuel permits would be increased from $25.00 to
$30.77 for FY 2020 and beyond. HB 2381 would also increase rates for the alternative tax LP-gas
permit users may elect to pay beginning in FY 2020.
HB 2381 would change the percentage of motor fuel tax collections credited to the State
Highway Fund and the Special City and County Highway Fund (SCCHF) as follows:
Current Law FY 2020 FY 2021 & After
State Highway Fund 66.37% 72.54% 72.99%
SCCHF 33.63% 27.46% 27.01%
The Honorable Steven Johnson, Chairperson
Page 2—HB 2381

The bill would reduce the amount of sales and compensating use taxes credited to the State
Highway Fund from the current 16.154 percent to 13.04 percent in FY 2020, 12.802 percent in FY
2021, 12.846 percent in FY 2022, 12.89 percent for FY 2023 and 12.933 percent for FY 2024 and
beyond.
The Department of Revenue estimates that HB 2381 would increase revenues to the State
General Fund by $104.2 million in FY 2020. Both the Department of Revenue and the Kansas
Department of Transportation estimate the net fiscal effect on the State Highway Fund and the
Special City and County Highway Fund would be zero. The bill would increase motor fuels tax
revenues to the State Highway Fund by $104.2 million. However, the amount of sales and
compensating use tax credited to the State Highway Fund would be reduced by an equal amount.
This amount would instead be credited to the State General Fund. The changes to the percentage
of motor fuel tax collections credited to the Special City and County Highway Fund would keep
revenues to the fund neutral for FY 2020 and beyond.
The fiscal effect to state revenues during subsequent years would be as follows:
FY 2021 FY 2022 FY 2023
State General Fund $113,900,000 $114,200,000 $114,500,000
State Highway Fund -- -- --
SSCHF -- -- --
$113,900,000 $114,200,000 $114,500,000
The Department of Revenue estimates the bill would require additional expenditures of
$138,840 from special revenue funds in FY 2020. Of this amount, $134,650 would be for
information technology updates and $4,190 for administrative costs. Any fiscal effect associated
with HB 2381 is not reflected in The FY 2020 Governor’s Budget Report.


Sincerely,

Larry L. Campbell
Director of the Budget


cc: Lynn Robinson, Department of Revenue
Ben Cleeves, Transportation


Statutes affected:
As introduced: 79-3492b, 79-34, 79-3620, 79-3710