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June 21, 2022 HB 22-1339
Legislative Council Staff
Nonpartisan Services for Colorado’s Legislature
Final Fiscal Note
Drafting Number:
Prime Sponsors:
LLS 22-0926
Rep. Herod; McCluskie
Sen. Zenzinger; Rankin
Date:
Bill Status:
Fiscal Analyst:
June 21, 2022
Signed into Law
Will Clark | 303-866-4720
Will.Clark@state.co.us
Bill Topic: MERGE DOR DIVISION OF MOTOR VEHICLES CASH FUNDS
Summary of
Fiscal Impact:
☒ State Revenue
☒ State Expenditure
☒ State Transfer/Diversion
☐ TABOR Refund
☒ Local Government
☐ Statutory Public Entity
Budget package bill. The bill combines two cash funds, and requires interest
earnings from DRIVES account funds to be credited to the DRIVES account. As a
result, the bill diverts state revenue from the General Fund, requires a one-time
transfer of funds, and minimally impacts state and local workload on an ongoing basis,
starting in FY 2022-23.
Appropriation
Summary:
No appropriation is required.
Fiscal Note
Status:
The fiscal note reflects the enacted bill, which was recommended by the Joint Budget
Committee as part of its FY 2022-23 Long Bill package.
Table 1
State Fiscal Impacts Under HB 22-1339
Budget Year
FY 2022-23
Out Year
FY 2023-24
Revenue - -
Expenditures
- -
Transfers/Diversions¹ Diversion from General Fund ($228,000) ($228,000)
Transfer from Licensing Services Cash Fund ($10,135,414) -
Transfer/Diversion to DRIVES Account $10,363,414 $228,000
Net Transfer/Diversion $0 $0
Other Budget Impacts - -
1
Actual Licensing Services Cash Fund transfer will depend on the fund’s balance on July 1, 2022, and actual DRIVES
account interest diversions from the General Fund will depend on annual interest earnings.
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June 21, 2022 HB 22-1339
Summary of Legislation
The bill combines the Licensing Services Cash Fund and the DRIVES Account in the Highway Users
Tax Fund (HUTF), and requires DRIVES Account interest earnings to be deposited into that account.
These provisions are described in more detail below.
Cash fund combination. The Department of Revenue (DOR) primarily uses the Licensing Services
Cash Fund for the issuance of driver licenses, driving permits, and state identification cards. The DOR
uses the DRIVES Account for development and operation of Colorado DRIVES, the state’s driver and
motor vehicles services software platform. This bill eliminates the Licensing Services Cash Fund, and
transfers all of the remaining fund balance into the DRIVES Account on July 1, 2022. In FY 2020-21,
the Licensing Services Cash Fund had an ending fund balance of around $11.4 million and the DRIVES
Account had an ending fund balance of around $18.7 million.
The bill also requires all fees that are currently credited to the Licensing Services Cash Fund to be
credited to the DRIVES Account, and requires all functions that are currently funded from the
Licensing Services Cash Fund to instead be funded by the DRIVES Account. In FY 2020-21, Licensing
Services Cash Fund revenue totaled around $40.8 million and expenditures totaled around
$44.5 million
Investment account earnings. Currently, the General Fund collects all interest earned on the fund
balance of the DRIVES Account. This bill requires these earnings to instead be deposited into the
DRIVES Account. The fiscal note estimates that DRIVES Account interest revenue will total around
$228,000 in FY 2022-23 and future years.
State Transfers and Diversions
The fiscal note estimates that the bill will result in a one-time transfer of $10.4 million to the DRIVES
Account in FY 2022-23 and diverts around $228,000 in interest earnings annually from the General
Fund to the DRIVES Account in FY 2022-23 and future years, as shown in Table 2 and discussed below.
Table 2
Transfers Under HB 22-1339
FY 2022-23 FY 2023-24
Licensing Services Cash Fund¹ ($10,135,414) -
Drives Account Interest Diverted from General Fund² ($228,000) ($228,000)
DRIVES Account $10,363,414 $228,000
Net Transfer $0 $0
1
Actual Licensing Services Cash Fund transfer will depend on the fund’s balance on July 1, 2022.
2
FY 2023-24 is an estimate only; the actual diversion will depend on annual interest earnings in the
DRIVES Account.
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June 21, 2022 HB 22-1339
In FY 2022-23, the bill requires a one-time transfer from the Licensing Services Cash Fund to the
DRIVES Account in the HUTF. The bill also requires an annual diversion of around $228,000 from the
General Fund to the DRIVES Account from DRIVES Account interest earnings. Actual interest
earnings from the DRIVES Account will depend on the annual fund balance and interest rates in
FY 2022-23 and future years.
State Revenue and Expenditures
Starting in FY 2022-23, the bill redirects around $42 million per year in state cash fund revenue from
the repealed Licensing Services Cash Fund to the DRIVES Account. Workload will decrease in the
DOR to the extent that consolidating these funds simplifies management and administration of the
programs that are funded by these revenue sources. It is assumed that any adjustments to
appropriations from consolidating the funds will be addressed in the Long Bill, and that the bill will
not result in a net change in expenditures.
Local Government
Workload will minimally increase for county clerks and recorders that provide services paid from the
Licensing Services Cash Fund to update accounting processes and distribute related revenue to the
DRIVES Account.
Effective Date
This bill was signed into law by the Governor on April 25, 2022, and takes effect on July 1, 2022; except
that Section 4 of the bill does not take effect because House Bill 22-1338 became law.
State and Local Government Contacts
County Clerks Revenue Treasury
The revenue and expenditure impacts in this fiscal note represent changes from current law under the bill for each
fiscal year. For additional information about fiscal notes, please visit: leg.colorado.gov/fiscalnotes.