Do You Know Where Your Car Registration Money Goes?

Proposition 101 Would Reduce Car Registration Fees To $10; Slash Ownership Tax To $1 Or $2

Drivers would save money in registration fees by voting yes on Proposition 101, but at what expense?

Proposition 101 would set your car registration licensing fee at $10 per year. The ownership tax would be reduced over the course of four years to $2 for new cars and $1 for used cars. There would no longer be taxes on car rentals and leases. There would be a sales tax exemption for $10,000 of a vehicle's cost. The state income tax rate would drop from 4.63 percent to 4.5 percent and eventually to 3.5 percent. All telecommunication taxes and charges, except for 911 charges, would be eliminated.

A no vote doesn't change anything.

7NEWS did some checking and found that a reduction in vehicle registration would also impact school districts, cities, counties, law enforcement, libraries and other special districts.

A driver's vehicle registration covers the license fee, the road and bridge fee and an ownership tax.

The road and bridge fee was added in 2009 as part of the FASTER bill passed by the state legislature. In July 2009, the vehicle registration fee for an average car went up $32 because of the bill that created a new fee to pay for road and bridge repair. In July 2010, the fee for an average car went up another $4.50, for a total of $36.50. In July 2011, it will go up another $4.50, making the fee $41.

The ownership tax makes up the biggest chunk of the registration. The tax is determined based on the age of the vehicle and the county where it needs to be registered. The ownership tax gets divided up much like a property tax, with money going to the local school district, city, county, libraries, fire and water districts and more.

"I do not know how it gets divvied up. I'm probably too trusting," said driver Ray Burchette.

"No idea that you register a car and it goes in part to the school district," said driver Becca Butler-Dines. "If that money goes to the school district, I think that it's important that we all pay a part."

In Denver County, Denver Public Schools gets 56.9 percent of the vehicle ownership tax. The city and county gets to keep 32.7 percent.

The school districts in Arapahoe County keep 53.8 percent of the ownership tax. Arapahoe County itself gets to keep 17.7 percent. Cities and municipalities in the county keep 7.7 percent.

Boulder County splits the ownership tax 130 different ways. The Boulder Valley School District keeps 35.89 percent. St. Vrain School District keeps 15.75 percent. The county itself keeps 29.43 percent. The city of Boulder collects 5.64 percent. The city of Longmont gets 3.11 percent. Smaller entities like the Boulder Rural Fire Protection District get 0.5 percent, and the Fourmile Canyon Fire District gets just 0.02 percent.

Douglas County allows Douglas County School District to collect 46 percent. The county itself keeps 21 percent. Law enforcement in Douglas County collects four percent.

As an example, 7NEWS has a vehicle registration that cost $375 total. The ownership tax was $308.49.

If the vehicle was registered in Douglas County, it would be broken down as follows:

  • Douglas County Schools: $141.91 (46 percent)
  • Douglas County: $64.78 (21 percent)
  • Law Enforcement: $12.34 (four percent)
  • The remaining 29 percent would be split among the city where the car was registered and any local districts that exist, such as libraries, fire or water districts.

    If the same vehicle was registered in Denver County, it would be broken down as follows:

  • Denver Public Schools: $175.53 (56.9 percent)
  • City and County of Denver: $100.87 (32.7 percent)
  • A yes vote on Proposition 101 would practically eliminate this funding method, by changing the ownership tax to $1 or $2 by 2014.

    "Registering you car should cover the charge that it costs to the county clerk to register a vehicle," said Natalie Menten, a Proposition 101 supporter. "We pay school property taxes, so why is a part of our vehicle registration going to schools? It's hard to say."

    "If the school districts aren't getting x amount of money, then where is that going to be made up in?" said Butler-Dines.

    "What are the schools going to do? They could come and ask us for a property tax increase," said Menten.