A new law in South Dakota will boost funding for the electronic system used to run the state’s IFTA program.
Gov. Dennis Daugaard signed into law Wednesday, Feb. 29, a bill to establish a license fee and a renewal fee for motor carriers licensing under the International Fuel Tax Agreement. Previously HB1031, the new law also sets up fees for decals and mailing.
The fees will be implemented July 1, 2012.
Department of Motor Vehicles Director Debra Hillmer recently told the Senate Transportation Committee the fees are needed to help cover the cost of setting up an electronic filing system for collecting IFTA fees.
“These are user fees. They are designed to cover some of the additional costs for the upgrades of the system,” Hillmer testified.
She said the previous program cost the state about $90,000 a year to operate. The expense to keep the new electronic system running is $120,000 annually.
Administrative funds now are used to operate the program.
To help cover the increased costs for the state, the new law requires truck drivers to pay $10 to setup an account. Renewals will also cost $10 each year.
Each set of decals will be $1.50, with a $1 fee charged to mail the decals.
The state DMV has never charged an issuance fee. Decals cost 50 cents.
Hillmer said the additional revenue from the fees would be about $40,000. In addition, the fees make registration costs more consistent with what motorists pay when registering their vehicles.
“We think it is a fair and equitable system,” she said during testimony on the bill.
The IFTA fees also more closely reflect costs in neighboring states.
North Dakota charges $20 for licenses while Iowa and Nebraska charge $10. Decals in neighboring states run between 50 cents and $2.50.
To view other legislative activities of interest for South Dakota, click here.
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