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To: Peter V who wrote (162500)	11/6/2008 9:39:54 PM
From: Elroy Jetson	Read Replies (1) \| Respond to of 306849

It used to be that people would buy a California emission car from a Reno Nevada dealer who bought it from a California dealer, or their California sales lot - and then ignore California laws regarding registration. If the law had been enforced, they could have found Nevada plates on thousands of Nevada plates in a community of 32,000. This evasion eliminated the annual California VLF licensing fee which was a percentage of the car's depreciated value - say $1,200 a year on a nicer car or as much as $3,000 annually on an exotic. Coupled with the savings on sales tax, you might save $4,000 the first year. Since the second year savings would be only $800 or so, and your car was now officially used, most would register their used car from Nevada in California after the first year. Since the VLF fee was eliminated in 2005, there's little incentive to drive a car with a Nevada plate. Schwarzenegger used to drive cars around LA with Nevada plates. The VLF was the one tax he was determined to eliminate. .

To: Peter V who wrote (162500)	11/11/2008 6:29:27 PM
From: Elroy Jetson	Respond to of 306849

Schwarzenegger eliminated the Vehicle License Fee, but it may be brought back so the Sales Tax can be raised less. latimes.com California budget analyst recommends raising car license fee Legislative Analyst Mac Taylor forecasts that the state will need to close a $27.8-billion budget gap in the next 20 months. He recommends a sales tax increase of 1 cent on the dollar. Los Angeles Times -- By Jordan Rau -- November 11, 2008 Reporting from Sacramento -- While offering the grimmest forecast yet of California's finances, the Legislature's nonpartisan fiscal analyst recommended today that lawmakers pare back Gov. Arnold Schwarzenegger's proposed 1 1/2-cent sales tax increase and instead hike fees on cars. In a new report, Legislative Analyst Mac Taylor forecast that the state would need to close a $27.8-billion budget gap during the next 20 months. That projection is more than $3 billion higher than the Schwarzenegger administration has estimated. The governor last week called a special session of the Legislature and proposed deep cuts in services and a panoply of tax increases to deal with California's collapsing finances. Though calling the governor's proposal "credible," the analyst said raising the sales tax would further hurt the economy by discouraging Californians from buying local products and instead send them to Internet purchases that escape the state sales tax. Schwarzenegger's proposed increase would make Californians' average sales tax the highest in the nation, about 9.5%, the analyst said. Taylor recommended a smaller increase of 1 cent on the dollar. The analyst favored increasing the annual vehicle license fee, from 0.65% of a car's value to 1%. It is an idea that already has traction among Democratic lawmakers, but one that Schwarzenegger has resisted. His opposition to that fee was a main plank of his 2003 election, and he reduced the fee as one of his first acts in office. The governor instead has proposed charging people an additional flat fee of $12 more when they register their automobiles each year. That would bring in only about a tenth of the $1.6 billion in revenue that a vehicle license fee increase would net. The analyst said that without major changes, the state would run huge shortfalls on the order of $22 billion annually over the next five years even if the economy rebounded. The analyst's wider budget gap was influenced by the rapid decline in the state's housing market. He projected that school districts would lose $1.5 billion over the next three years, requiring the state to fill that gap. The economic downturn has also led to more people on health and social services programs. In addition, firefighting costs are higher than projected. Meanwhile, Assembly Speaker Karen Bass (D-Los Angeles) today urged the federal government to bail out states as well as banks. "We think that with the state of California about to go over a cliff, we ought to be part of the bailout as well," she said at a news conference. "Can we have $5 billion or $10 billion?" The analyst said that although California should press for federal assistance, lawmakers should not count on or wait for such relief. "If the state has any hope of developing a fiscally responsible 2009-10 budget, it must begin acting now," Taylor wrote. .