The following article appeared in Classic Auto Restorer, Feb 92 issue
that just arrived two days ago. I live in Oregon so I'm just posting this
as a FYI. You Californians may already be aware of this.
THE BIG HIT
California's new car fees hit collector car owners hard.
By Joe Stapac
A legislative struggle in California to salvage a troubled budget has
resulted in important changes in registration fees that could affect owners
of collectible and special interest vehicles.
Statewide sales taxes have been boosted to 7.25%, which means that
counties that have a transit tax override are charging above the 8% mark.
More importantly, the basis upon which registration fees are accessed for
collectible vehicles has been completely changed.
Expect steep increases in registration fees, which in some cases might
amount to a hundred-times boost in what was paid last year.
For example, a collector car currently licensed with Historic Vehicle
plates may have last year paid a registration fee of $100. That fee was
based on a scale that bottomed out as cars (any car, not just a collector
car) got older. Now, however, the Department of Motor Vehicles (DMV) has
the power, granted by a new law, to charge a registration fee based upon
the current market value of that vehicle; that fee might reach into the
thousands of dollars, depending upon what price reference the DMV chooses to
use. Furthermore, the law also slaps a 2.2%, one year surcharge on all
vehicle registration fees as a money-making ploy.
Believe it or not, the law also contains a clause that says if more than
$200 is spent to alter or modify (or restore?) a car or truck, that vehicle
is subject to a new valuation by the DMV. The owner must take it to a DMV
office and submit it for a new appraisal for licensing and registration
purposes. Supposedly this clause doesn't apply to ordinary repairs,
replacement of operating parts or tuneups, but is aimed at body changes or
customizing. Again, it is unclear how such a legislative act will actually
be enforced. Numerous avenues for evasion seem obvious.
To clarify (or perhaps further muddy the waters), vehicle registration
fees have traditionally been based upon the new selling price of a car.
Over the next 10 years of the car's life, that annaual registration fee
declined 5% each year, bottoming out to 5% of the car's orginal selling
price in the 11th year. After that, if the car were still on the road, the
registered owner paid a flat fee of a few dollars, plus the base
registration fee of $22.
At the moment there are no exemptions for collector cars from these new
fee schedules, although we have yet to see how the DMV will go about
assessing the actual value for registration purposes of the thousands of
collector cars currently registered within California.
Buyers of used vehicles, in order to register their cars, must go to the
nearest DMV office and fill out the proper forms. One form, under penalty of
perjury, requires listing of the purchase price- which apparently could
include an auction or estate. No longer is that 1938 LaSalle simply a 53-year
old car that happens to continue to run. The DMV does not have to accept the
stated sale price as supplied by the registrant- they can look it up in any
price guide or advertisements and assess the owner accordingly.
As our readers know, there are differences between asking prices and
actual prices; even auctions aren't necessarily a true window into reality,
as there are reserves and other devices through which auctioneers can prop up
the advertised price of a vehicle. In short, any source used by the DMV to
set a price on collectore vehicles is open to dispute.
Unfortunately, the motorists who will really be hurt by this new program
aren't the collector car owners, but the working poor people who rely upon
old cars as daily transportation. It has often been said that the poor can't
affort economy cars; they rely on old clunks from the sixties and seventies
as transportation vehicles-cars that change hands downtown (rather than under
awnings at the Country Club) for $400-$800 and are held together with baling
wire and dertermination. Their registration fees will triple the next time
they need a license sticker. Economists call this a regressive tax. Since
the poor cannot give up their cars due to the parlous condition of public
transportation in California, more old cars will be driven without current
tags-or with stolen tags.
Car collectors, on the other hand, will probably take another out.
Rather than register their collector cars for the priviledge of driving with
a Horseless Carriage or Historical Vehicle plate, they have the option of
paying the DMV a mere $5 for a Certificate of Non-operation, withdrawing
the vehicle from operation on California's public roads. The car is still
owned, but would have to be trailered to old car events. Operation on a
public road roadway wold be a violation of the law, but cars could still be
operated on private roads and private property.
So what happens now? We honestly don't know. The Association of
California Car Clubs, a lobbying group, is working with legislators to try
to introduce a bill that will address these problems. If not, we foresee a
sudden drop in the offical, registered population of collector cars within
California.
|