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Recreation, environment, access, and land use news and information for California.
8 minutes reading time (1675 words)

Operation Restore - The California OHMVR Program and the OHV Trust Fund (Part 2)

Introduction: The Off Highway Motor Vehicle Recreation Program was established under Chappie-Z’berg Off-Highway Motor Vehicle Law of 1971 as a self-funded program to provide for motorized recreation opportunities for the State of California and authorized grants and cooperative agreements to local and federal agencies and non-profits in support of OHV recreation opportunities.

The Off-Highway Gas Tax Act of 1972 authorized the transfer of gas tax paid by registered off-highway vehicle from the Motor Vehicle Fuel Account into an OHV Fund Account (Ch. 1382 and 1405/72, AB 151 and SB 125, Chappie-Gregorio).  In 1973, gas tax paid for street-licensed vehicles being used off the public roads/highways was authorized to be transferred from the Motor Vehicle Fuel Account into an OHV Fund Account (Ch 1195/73, AB 1661, Chappie).  In 2007, SB-742 was approved by a near unanimous vote and changed the motor vehicle fuel tax revenue to be derived from a calculation based on the actual number of OHV recreation-related public land visitor-use-days.  

Subsequent 1975 legislation amended Section 8352.6 of the Revenue and Taxation Code relating to transfers from the Motor Vehicle Fuel Account (Ch. 508/75, AB 565, Chappie) and provided amendments and additions to the Vehicle Code and revised Motor Vehicle Fuel Account transfers to include fuel taxes used by vehicles in off-highway operation subject to identification under Division 16.5 of the Vehicle Code (Ch. 1050/75, AB 18643, Chappie).

Together, this legislation codified the OHV Program and the OHV Trust Fund with a principle funding stream from the Motor Vehicle Fuel Account.

For the first decade, the program was managed as an “office” within the Department of Parks and Recreation (State Parks).  The Off-Highway Motor Vehicle Law of 1983 created the Off Highway Motor Vehicle Recreation Division (OHMVR Division) within State Parks, established the OHMVR Commission, and identified the State Vehicular Recreation Area and Trail “System”.   

The original 1971 legislation established a self-funded program that is controlled by California Vehicle Code 38000, Public Resources Code 5090, and California Code of Regulations 4970 to issue grants and cooperative agreements to local and federal agencies to provide for and manage motorized recreation opportunities, manage SVRA operations, and provide for capital outlay and acquisitions.  The funding mechanism for the self-funded OHV program is gas tax from the Motor Vehicle Fuel Account, vehicle registration fees, SVRA entry fees, and fines and forfeitures.  Throughout the history of the OHV Program, NO General Fund revenues have been used to support the OHV Program.

The California State Senate and Assembly moved with action that proposed to de-fund the Local Assistance Grants, an integral part of the California OHV Program, for the 2013 Fiscal Year.  The action would remove the State Gas Tax funding allocated to the OHV Program Local Assistance Grants.

Background: The OHV Program is broken into components: SVRA operations, headquarters operations, local assistance grants, and funding for acquisition and capital outlay.  The funding mechanism for the self-funded OHV Program is provided by gas tax revenue from the Motor Vehicle Fuel Account, registration fees for non-street legal vehicle used for recreation, entry fees to the State Vehicle Recreation Areas (SVRA), and fines and forfeitures; collectively referred to as the "OHV Trust Fund".

The OHMVR Program is user funded (self-funded) and receives no general fund supporting revenue.

The 2013 Fiscal Year is the fourth consecutive year where substantial funding has been diverted from the OHV Trust Fund to other sources.  Since 1974, approximately $188 million has been diverted from the OHV Trust Fund to the General Fund and State Parks and Recreation Fund.  Of that total amount, $129 million has been diverted from the self-funded OHV Trust Fund within the last four state budget cycles.

Budget Year Transfer Amount
1974 $1,500,000
1982 $8,500,000
1983 $13,000,000
1990 $3,000,000
1992 $10,244,000
1993 $16,046,000
1995 $4,522,000
2009 $90,000,000
2010 $22,000,000
2011 $10,000,000
2012 $7,000,000
Table 1: Budget Year and Amount of Transfer from OHMVR Trust Fund

There is an on-going "take" of $10 million of the gas tax funding input to the OHV Program from the 2011 Fiscal Year.  That was identified in legislation as a perpetual transfer of funds from the Motor Vehicle Fund Account slated for the OHV Trust Fund and OHV Program support to the General Fund.  That budget action reduced the local assistance grants component by $5 million and the OHV Trust Fund reserve by $5 million.

That action reduced the total for local assistance grants component of the OHV Program from $26 million in Fiscal Year 2011 to $21 million for Fiscal Year 2012.

The current Simitian proposal (Sustainable Parks Initiative) would transfer the programmed gas tax funding ($21 million) from the Motor Vehicle Fund Account slated for the OHV Trust Fund and designated for the local assistance grants.  That proposed action would eliminate the local assistance grants component of the OHMVR program.

Technically, the Simitian proposal DOES NOT impact the OHV operations (SVRA and headquarters) nor the OHV Trust Fund as the proposal specifically addresses only the $21 million identified for the local assistance grants component of the OHV Program.

The Simitian proposal is for $21 million with a 3-year sunset attached, Fiscal Years 2013, 2014, and 2015.  Directly, it would reduce the local assistance grants component of the OHV Program by $63 million over the three years.

In addition, coupled with the previous $10 million per year transfer, there is a cumulative reduction of $78 million for local assistance grants and an additional $15 million from the OHV Trust Fund reserve for acquisitions and capital outlays over Fiscal Years 2013-2015.

So, in reality, the OHV Program is looking at a projected $93 million cumulative reduction over the next three Fiscal Years.  

FY 2013 Status

The ink is dry on the Fiscal Year 2013 California budget and details are coming into focus.  So, what about the OHV Program?  What about the future of OHV recreation in the state of California? The OHV Program budget is linked to the California State Parks budget. Now, for the rest of the story...

While news headlines claim nearly all California State Parks will remain open, the angst caused by State Senator Simitian and the California State Parks Foundation ended as no benefit to the State Parks and a detriment to the OHV Program.

BAD NEWS: In short, the Governor reduced the OHV Trust Fund portion of gas tax revenue. Rather than $21 million loss of gas tax funding to the OHV Program, the loss was $7 million.  The end result is the OHV local assistance grant program will be funded at the $10 million level (identified through separate legislation as a cap on local assistance grant funding) as opposed to the $21 million of the previous year.

GOOD NEWS: Now, let’s examine the details of the gas tax portion.  There was an effort to divert $21 million in gas tax revenue from the Motor Vehicle Fund Account originally proposed to fund the local assistance grants portion of the state OHV Program.  That effort resulted in $7 million being lost while the remaining $14 million was transferred to the OHV Trust Fund.  

Thanks to letters and calls from OHV recreation to local representatives and the Governor’s office, the reduction of funding was not as severe as it could have been.  

MORE BAD NEWS: Now, let’s examine the details of the local assistance grants portion.  The $21 million was directed to support the local assistance grants program.  Other than that, it did not impact the OHV Trust Fund; only the local assistance grants program which was targeted to need $21 million for the 2012 grant cycle.

During the legislative session, separate legislation provided authority to spend ONLY $10 million on local assistance grants for the 2012 grant cycle.  This placed a cap on the grants program; a 52% reduction from the proposed 2012 grants cycle.

IMPORTANT DISTINCTION: While $14 million was transferred to the OHV Trust Fund, the OHV Program has authority to spend ONLY $10 million for local assistance grants, a 52% reduction and serious impact on local governments and OHV recreation opportunity.

At this time, the State Vehicle Recreation Areas remain fully funded and open for use.  The funding reduction will be felt at federal and county facilities (like the Rubicon Trail of Eldorado County) that depend on OHV local assistance grants to remain open.  For the previous three years of OHV grants, funding has dropped from $26 million in 2010, $21 million in 2011, and $10 million for the current 2012 grant cycle.

So, what is the impact to OHV recreation?  First, the $10 million is projected to be split as such:

Law Enforcement - $2 million
Operation and Maintenance - $5 million
Restoration - $2.5 million
Education and Safety - $500,000

For an estimate of what this means to the current grants awaiting funding for Operations and Maintenance projects, see:
http://www.4x4voice.com/Notebook/ohmvr/grants/Staff_Report-Grants_Program-June2012-p2-4.pdf

While BLM El Centro and Glamis Sand Dunes will receive grant funding, the Eldorado National Forest and the iconic Rubicon Trail will not receive grant funding.  

So, what does this mean for OHV recreation? To put this in perspective, the below listed documents provide an analysis of the how Law Enforcement, Forest Service, BLM, Non-Profit, and Local grant recipients have fared for the past four grant cycles.  Note, the 2012 grant cycle is included at its original projected amount.

http://www.4x4voice.com/Notebook/ohmvr/grants/OHMVR-Grants-LE-by-Applicant.pdf
http://www.4x4voice.com/Notebook/ohmvr/grants/OHMVR-Grants-O&M-Applicant.pdf
http://www.4x4voice.com/Notebook/ohmvr/grants/OHMVR-Grants-Restoration-by-Applicant.pdf
http://www.4x4voice.com/Notebook/ohmvr/grants/OHMVR-Grants-Safety-Edu-Awarded-by-Applicant.pdf
http://www.4x4voice.com/Notebook/ohmvr/grants/OHMVR-Grants-Total-by-Applicant.pdf

As this analysis points out, the local assistance grants program is an important part of the state OHV Program.  It provides much needed funding to Forest Service, BLM and others to maintain the OHV trails and off-road areas important to OHV recreation.  The OHV Grants Program provides an important economic boost to the rural counties of California where OHV recreation occurs.

In the end, the California State Parks System was projected to receive a $21 million infusion at the expense of OHV recreation.  They received a net loss of approximately $24 million while the OHV Program lost $7 million.  The California State Parks System is still on life support.  The California OHV Program is now connected to life support.

For details of the OHV portion of the California State Budget, see pages 58 and 59 of:   http://www.dof.ca.gov/documents/FullBudgetSummary_web.pdf

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