LEGISLATIVE FISCAL OFFICE
Fiscal Note
Fiscal Note On: SB 389 SLS 22RS 581
Bill Text Version: ENROLLED
Opp. Chamb. Action:
Proposed Amd.:
Sub. Bill For.:
Date: June 6, 2022 7:37 AM Author: REESE
Dept./Agy.: Revenue / OMV
Subject: Reinstatement of Driver’s license due to delinquent tax Analyst: Emily DiPalma
TAX/INCOME/PERSONAL EN SEE FISC NOTE SG RV See Note Page 1 of 1
Provides relative to the suspension of driver's licenses for failure to pay taxes. (gov sig)
Current law mandates the Department of Public Safety, Office of Motor Vehicles (OMV) to suspend the Louisiana driver’s license of an
individual with more than $1,000 in final and non-appealable delinquent personal income tax liabilities (exclusive of penalty, interest, costs
and other charges) when notified by the Department of Revenue (LDR). The suspension remains in place until the delinquency (including
penalty, interest and all costs) is resolved by payment or payment plan and the OMV is notified by LDR.
Proposed law retains current law and provides for a waiver of the license reinstatement fee once a payment or payment plan of delinquent
personal income tax is in place. LDR & OMV may enter into an interagency agreement to for LDR to reimburse OMV for actual expenses
associated with the suspensions & reinstatements and provide for disbursement of a portion of the transfer in accordance with the existing
dedication for EMS. Proposed law allows LDR the discretion to request drivers license suspensions at higher thresholds of delinquent
personal income tax liabilities based on an individual’s historical compliance with Louisiana tax law, as well as the facts and circumstances
related to the current unpaid tax liability, and may accept surety or collateral in lieu of suspension. Effective January 1, 2023.
EXPENDITURES 2022-23 2023-24 2024-25 2025-26 2026-27 5 -YEAR TOTAL
State Gen. Fd. $0 $0 $0 $0 $0 $0
Agy. Self-Gen. $0 $0 $0 $0 $0 $0
Ded./Other INCREASE INCREASE INCREASE INCREASE INCREASE
Federal Funds $0 $0 $0 $0 $0 $0
Local Funds $0 $0 $0 $0 $0 $0
Annual Total
REVENUES 2022-23 2023-24 2024-25 2025-26 2026-27 5 -YEAR TOTAL
State Gen. Fd. $0 $0 $0 $0 $0 $0
Agy. Self-Gen. DECREASE DECREASE DECREASE DECREASE DECREASE
Ded./Other INCREASE INCREASE INCREASE INCREASE INCREASE
Federal Funds $0 $0 $0 $0 $0 $0
Local Funds $0 $0 $0 $0 $0 $0
Annual Total
EXPENDITURE EXPLANATION
LDR and OMV may enter into an agreement in which LDR will reimburse OMV for the actual expenses associated with the license
suspensions and reinstatements and provide for a dedication to emergency medical services (EMS) in the manner of current law which is a
portion of reinstatement fees ($10 of the $60 fee or 1/6). The bill states that 1/6 of the actual expenses (possibly including the EMS
dedication as an additional actual OMV expense but not explicit in the bill) will be allocated in the same manner as R.S. 32:414(H). The
IAT appropriation required for transfer from LDR to OMV is depicted in the table above with the amount apparently subject to negotiation
between the agencies.
REVENUE EXPLANATION
The bill states that LDR shall promptly notify OMV to reinstate driving privileges and waives the OMV mandate to collect
reinstatement fees for these reinstated licenses without further action needed by the individual. Instead of collecting the
reinstatement fee, OMV will receive an interagency transfer from LDR to cover the actual administrative cost of the
suspensions and reinstatements. One sixth of the reimbursement will be dedicated to Emergency Medical Services (EMS) in
the same manner as R.S. 32:414(H). It is not clear if the EMS dedication will be an added actual cost or be deducted from
the negotiated transfer amount. The timing of the transfer will apparently be included in the interagency agreement. It is not
clear where LDR will source the SGR to be transferred to OMV.
OMV indicates that the average administrative costs for suspending 11,093 accounts between FY17-19 was $7.71 per
account (call center, notices with postage, etc.) and for clearing 7,575 accounts was $4.06 per account (system adjustments
and notices) for a total administrative cost of about $116,250 (11,093*$7.71 + 7,575*$4.06) between FY17-19. Presuming
this estimate of $116,250 represents the average annual amount to be transferred, the dedication for EMS would be
$19,375 on average each year under proposed law.
OMV indicates that an average of 7,575 accounts were cleared with a reinstatement fee of $60 between FY17-19, which
presumes about $455,000 in fees that will not be collected under proposed law. If the average implementation costs
($116,250) and fee collections ($455,000) hold, the bill would leave about $339,000 in SGR appropriations in OMV, LDH,
DPS and local EMS unfunded in FY 23 and beyond. Thus, the decrease in self generated funds is expected to be of a higher
magntidue than the increase in IAT, depicted in the table above without a figure due to the anticipation of a negotiated
transfer amount. Since the bill does not designate the transfer from LDR as SGR, OMV may require an IAT appropriation in
order to spend the funds. It is presumed that OMV will deposit and disburse the 1/6 EMS dedication in the same manner as
under current law.
To the extent that LDR chooses to apply a higher tax delinquency threshold before suspending driver’s licenses,
the fiscal impacts for revenue and expenditures will be in the same means of finance but larger as some
suspensions and reinstatements will not take place.
Senate Dual Referral Rules House
x 13.5.1 >= $100,000 Annual Fiscal Cost {S & H} 6.8(F)(1) >= $100,000 SGF Fiscal Cost {H & S}
Deborah Vivien
13.5.2 >= $500,000 Annual Tax or Fee 6.8(G) >= $500,000 Tax or Fee Increase
Change {S & H} Chief Economist
or a Net Fee Decrease {S}


Statutes affected:
SB389 Original: 32:414(R)(1), 47:2(A)
SB389 Engrossed: 32:414(R)(1), 47:2(A)
SB389 Enrolled: 32:414(R)(1), 32:415(C)(1), 47:2(A)
SB389 Act 701: 32:414(R)(1), 32:415(C)(1), 47:2(A)