Proposed Vessel Registration Fee Increase Held Open in Budget Subcommittees

SACRAMENTO— A state budget proposal to increase the vessel renewal fee by 250 percent has been heard by two Senate budget subcommittees, but so far, no decision has been made.

The proposal was heard by Senate Budget Subcommittee No. 2 on Feb. 9 and Senate Budget Subcommittee No. 3 on Feb. 17 and held open by both subcommittees.

The proposal, which is part of Governor Gavin Newsom’s proposed 2021-22 budget, would increase the vessel renewal fee from $20 to $70 biennially and could be implemented as soon as July 1. California State Parks staff said the proposal aims to address a projected $52 million annual deficit in the Harbor and Watercraft Revolving Fund (HWRF), which is the primary fund source for boating programs managed by the California Division of Boating and Waterways (DBW).

The Recreational Boaters of California said the organization is not supporting the governor’s proposal as it stands now. Jerry Desmond Jr., RBOC’s director of government relations, said the proposal being held open buys them some time to have their concerns addressed.

“We believe we have a lot more work to do,” said Desmond.

On Feb. 16, RBOC, along with 13 other boating organizations, sent a letter to the Senate budget subcommittees asking them to take these actions: reduce the amount of the proposed increase to an amount significantly less than 250 percent; re-direct a small, yet reasonable portion of the $107 million in annual boat fuel tax dollars to the HWRF; permanently eliminate the authority for HWRF funds to be utilized for beach erosion control; establish an equitable funding structure for the invasive species program that includes other beneficiaries with a proportional financial framework; establish in statute the stakeholder process to be undertaken over the next few years to develop long-term funding approaches to the HWRF, and add to the Boating and Waterways Commission’s statutory authority the responsibility to approve loans and grants from the HWRF.

Those concerns were the major focus of the time-limited discussions at the subcommittee meetings.

“Does the department have any data that shows the fuel tax dollars and the registration fees have been placed in the HWRF account? And I’d like to see that data,” asked California State Assemblymember Thurston Smith at the Senate Budget Subcommittee No. 3 meeting.

Director of Administrative Services for California State Parks Will Schaafsma, who gave a presentation on the proposal to both subcommittees, said State Parks does have that data and would provide it.

“It’s a 250 percent increase and first in many years, one, I would like to be able to get your thoughts on indexing so we’re not here having to be able to advance such a large potential increase,” said Senator Mike McGuire at the Senate Budget Subcommittee No. 2 meeting.

Schaafsma said the fee increase would be a temporary solution to avoid a negative fund balance for the next several years and a long-term revenue strategy would be put together. One option is moving to a tiered vessel registration fee system based on vessel length. He said they would work with boaters to come up with a long-term solution that would more satisfactory to all parties.

The next hearing for the proposal has not been announced yet. Hearing dates and agendas will be posted at sbud.senate.ca.gov when they become available. Boaters interested in submitting comments or letters on the proposal can email those to SBUD.Committee@senate.ca.gov.