PROPOSED RULEMAKING
STATE BOARD OF VEHICLE MANUFACTURERS, DEALERS AND SALESPERSONS
[49 PA. CODE CH. 19]
Biennial Renewal Fees
[36 Pa.B. 7619]
[Saturday, December 16, 2006]The State Board of Vehicle Manufacturers, Dealers and Salespersons (Board) proposes to amend § 19.4 (relating to fees) to read as set forth in Annex A. The proposed rulemaking would increase the biennial license renewal fees for all classes of the Board's licensees.
Effective Date
The proposed rulemaking will be effective upon final-form publication in the Pennsylvania Bulletin. The new biennial renewal fees will take effect for the biennial period beginning June 1, 2007.
Statutory Authority
The Board is required by law to support its operations from revenue it generates from fees, fines and civil penalties. Section 30(a) of the Board of Vehicles Act (act) (63 P. S. § 818.30(a)) requires the Board to increase fees so that adequate revenue is raised to meet the Board's expenditures in enforcing the act. While many of the Board's fees are based on the cost of providing a service to an individual licensee, such as processing an application for licensure, biennial renewal fees are charged to licensees across the Board and are thus most appropriately increased to meet the Board's general enforcement costs.
Background and Need for Amendment
The Board last increased its renewal fees in 1989. In the 17 years since the Board established the existing biennial renewal fees, the Board has seen a significant increase in its law enforcement budget, thus necessitating a fee increase.
At the July 13, 2006, Board meeting, the Bureau of Finance and Operations for the Department of State (Department) presented a summary of the Board's actual revenue and expenses for the past 3 fiscal years and projected revenues and expenses through Fiscal Year (FY) 2016-2017.
At the close of FY 2004-2005, a year in which the Board's revenue was high because licenses are renewed in odd numbered years, the Board carried a balance of $594,546.31. At the close of FY 2005-2006, however, the Board carried a deficit of $454,564.57. The projected deficit for FY 2006-2007 is $539,514; and the projected deficit for FY 2007-2008 is $2,048,514. By FY 2016-2017, the deficit is projected to reach $13,338,514. The Bureau of Finance and Operations anticipates that the proposed fee increases will enable the Board to recapture the current deficit and meet its estimated expenditures through at least FY 2016-2017.
The Board, as with other licensing boards and commissions within the Bureau of Professional and Occupational Affairs (Bureau), budgets on the basis of the following categories: administrative costs, which includes Board administration (Bureau-wide operating expenses such as printed forms, office supplies and interagency billings), Commissioner's office (staff expenses) and Departmental services (centralized support services such as the executive office, public information office and legislative affairs office); legal costs, which includes legal office (staff expenses), hearing expenses (staff of hearing examiner's office and stenographer services) and legislative and regulatory analysis (staff expenses); enforcement and investigation costs, which includes nontravel (staff expenses) and travel expenses; professional health monitoring program expenses (staff expenses); and Board member expenses (travel to meetings, accommodations when necessary).
Because it has been 17 years since the Board set the biennial renewal fees, it is difficult to ascertain any particular cost centers that have led to the need to increase the fees. Costs have risen across the spectrum of the Board's activities. The increases in the Board's biennial expenses occurred due to increases in costs of both Board services and Departmental expenses. The increases experienced by the Board itself are primarily in cost centers allocated to law enforcement costs and legal office costs. These increased expenditures are directly related to increases in the number of complaints filed. Each complaint filed produces costs in law enforcement and in the professional compliance office and prosecution division of the legal office. The Board received an average of 404 complaints per year from FY 1996-1997 through FY 2000-2001. The Board received an average of 499 complaints per year from FY 2001-2002 to FY 2005-2006. The number of serious disciplinary sanctions imposed by the Board, which includes any sanction that suspends or revokes a license, increased from 37 in FY 1996-1997 to 70 in FY 2005-2006. The total number of disciplinary sanctions imposed by the Board increased from 150 in FY 1996-1997 to 178 in FY 2005-2006.
During FY 2003-2004, additional costs were incurred as a result of one-time charges to the Department for personnel costs. This one-time charge was split equitably within the Professional Licensure Augmentation Account and other related restricted accounts administered by the Bureau.
Description of Proposed Amendments
The proposed amendments will increase the biennial renewal fees as follows:
Vehicle dealer from $70 to $175 Vehicle dealer branch from $70 to $175 Vehicle auction from $70 to $175 Vehicle manufacturer from $100 to $250 Manufacturer branch from $70 to $175 Vehicle distributor from $70 to $175 Vehicle representative from $35 to $90 Vehicle salesperson from $35 to $90 The proposed increases are based on the expense and revenue estimates provided to the Board as set forth in Annex A. By this increase, the Board seeks to recoup its current deficit and avoid the projected deficits.
Fiscal Impact
It is estimated that the proposed rulemaking will have a modest fiscal impact on the cost of doing business of licensees over the next several biennial periods. The increase in fees should have no other fiscal impact on the private sector, the general public or political subdivisions.
Paperwork Requirements
The proposed rulemaking will require the Board to alter some of its forms to reflect the new biennial renewal fees. However, the proposed rulemaking should not create additional paperwork for the private sector.
Sunset Date
The act requires the Board to monitor its revenue and costs on a fiscal year and biennial basis. Therefore, no sunset date has been assigned.
Regulatory Review
Under section 5(f) of the Regulatory Review Act (71 P. S. § 745.5(f)), on December 5, 2006, the Board submitted a copy of this proposed rulemaking and a copy of a Regulatory Analysis Form to the Independent Regulatory Review Commission (IRRC) and the Legislative Reference Bureau for publication. The proposed rulemaking will be published in the Pennsylvania Bulletin on December 16, 2006, beginning a 30-day public comment period. On December 5, 2006, the Board sent a courtesy copy of the proposed rulemaking to the Executive Directors for the House Professional Licensure Committee (HPLC) and Senate Consumer Protection and Professional Licensure Committee (SCP/PLC). Under the Regulatory Review Act (71 P. S. §§ 745.1--745.15), the Board will deliver the proposed rulemaking to the HPLC and SCP/PLC by the second Monday after the date on which committee designations for the 2007-2008 session of the General Assembly are published in the Pennsylvania Bulletin.
Under section 5(g) of the Regulatory Review Act, IRRC may convey any comments, recommendations or objections to the proposed rulemaking within 30 days of the close of the public comment period. The comments, recommendations or objections must specify the regulatory review criteria which have not been met. The Regulatory Review Act specifies detailed procedures for review, prior to final publication of the rulemaking, by the Board, the General Assembly and the Governor of comments, recommendations or objections raised.
Public Comment
Interested persons are invited to submit written comments, suggestions or objections regarding this proposed rulemaking to Pamela Marsden, Administrator, State Board of Vehicle Manufacturers, Dealers and Salespersons, P. O. Box 2649, Harrisburg, PA 17105-2649 within 30 days following publication of this proposed rulemaking in the Pennsylvania Bulletin.
EDWIN K. GALBREATH, Jr.,
ChairpersonFiscal Note: 16A-6010. No fiscal impact; (8) recommends adoption.
Annex A
TITLE 49. PROFESSIONAL AND VOCATIONAL STANDARDS
PART I. DEPARTMENT OF STATE
Subpart A. PROFESSIONAL AND OCCUPATIONAL AFFAIRS
CHAPTER 19. STATE BOARD OF VEHICLE MANUFACTURERS, DEALERS AND SALESPERSONS
GENERAL PROVISIONS § 19.4. Fees.
The following is the schedule of fess charged by the Board:
* * * * *
Biennial renewal--salesperson license $[35]90 Biennial renewal--vehicle representative license $[35]90 Biennial renewal--manufacturer license $[100]250 Biennial renewal--manufacturer branch license $[70]175 Biennial renewal--distributor license $[70]175 Biennial renewal--dealer license $[70]175 Biennial renewal--auction license $[70]175 Biennial renewal--dealer branch license $[70]175
[Pa.B. Doc. No. 06-2455. Filed for public inspection December 15, 2006, 9:00 a.m.]
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