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Opinion California Dreaming—Where Did All the OHV Money Go?

 

 

 

 

 

 

 

 

On May 31st, the California State Assembly followed the lead of the California State Senate by removing $21 Million from the Off-Highway Motor Vehicle Recreation (OHMVR) division of State Parks in an effort to starve off the closing of a number of non-motorized state parks. The OHMVR program has a 40-year history of finding itself in the position of “piggy bank” for the State of California. The practice started in 1974 and has continued on a regular basis. This year’s $21 million was not an easy decision for the State Senate Sub-Committee, but was passed by two termed-out Senators after a plea from the single returning Republican, Senator Fuller, who voted against the measure. This latest re-appropriation of funds falls on the heels of last year’s $10 million dollar removal of gas tax funds before it hits the trust fund in an effort to prop up the poorly managed State General Fund. Originally intended for State Parks, the $10 million dollar heist taken indefinitely was quickly absorbed into the general fund, and did not benefit State Parks. Total loss of revenue to the OHMVR fund following this years sub-committee in both the Assembly and the Senate now totals a $31 million dollar loss for the year, and will last no less than three years.

 

It is extremely important to identify the funding sources of the OHMVR trust in order to understand how this can even be considered. The long history would fill a volume of this newsletter, and I am hardly the correct person to tell this story, but here are some basic amounts to help paint the picture. Below are approximations only:

Annually-

Concessions from SVRA’s, fines, and other income: $3-$4 Million

Green Sticker registrations: $17 Million

Gax tax: $65 million.

Total: $85 Million in revenue

 

But remember, we have already lost $10 million indefinitely (last year) from gas tax income putting us at only $75 million in projected revenue. According to State Senator Simitian and verified by the State finance department during May 23rd testimony in sub-committee, the OHMVR trust has a carryover balance of $67 million.

 

 

Concessions and Other $4 Million

Green Sticker $17 Million

Gas Tax $55 Million

Previous Balance $67 Million

Total $143 Million.

 

 

 

Including grants, the program as it currently provides services will require about $140 Million to operate per year.

If there are no additional losses of income, the operating budget does not change, there are no OHV acquisitions, no major capital improvements and the OHMVR does not have to finance any lawsuits from environmentalists, the California State OHMVR program could be insolvent in 18 Months.

 

What about all the money the program has loaned to the State? How do we get it back?

The OHV division of State Parks has a 40-year tradition of self-sustaining user fee based service to California citizens. It has never in its history had a budget with red ink. Still, the program seems to be a free for all whenever the state needs money. In the 1990’s, the OHV community successfully sued the State for money borrowed from the program to the tune of $50 million, but it will only be made available when the program is nearly broke.

 

In Fiscal Year 2008/09, $90 million of accumulated monies were borrowed from the OHV Trust Fund. Budget language was passed which said, notwithstanding other provisions of law (e.g., the two-year requirement for repayment of funds), the loan was to be repaid in four years, no later than June 30, 2013.

In FY 2009/10, an additional $22 million was borrowed from the OHV Trust Fund. No modification of the repayment requirement was made; these funds are due back to the OHV Trust Fund two years from the time of the loan, June 30, 2012.

 

The following graph shows the amount of money paid back on loans from the OHV Program.

 

 

 

 

 

 

 

 

 

California Fish and Game $3,000,000 loan paid in full

Transfer of funds from OHV to State Parks rec fund. $25,647,000,

Returned by State parks to OHV $11,123,000 balance due $14,524,000

California General Fund transfers and loans $160,585,000

Amount returned $0

 

Payment due June 30th 2012: $22 Million

Payment due June 30th 2013: $90 Million

Payments due in time of need: $50 Million.

Total promissory note less interest: $162Million.

Chance the OHMVR will receive payment? Slim and none.

 

Of important note are statements made by California Assemblyman Brian Jones (R-Santee) during the May 31st assembly sub-committee meeting on the subject. Jones raised a valuable question. If our state is approaching annual revenue on par with revenue before the recession, why are we seeing such a discrepancy in our ability to fund items in this State?

Assembly Testimony link below.

http://calchannel.granicus.com/MediaPlayer.php?view_id=7&clip_id=470

State Senate Testimony link below

http://calchannel.granicus.com/MediaPlayer.php?view_id=7&clip_id=428

It is apparent that a number of things are going to need to be addressed in regards to the OHMVR Trust. In over 4 hours of testimony I have watched over the last two days, I have not seen California OHV Economic Impact addressed in real numbers. Motorized recreation is a large economic impact in this state. Our industry is centered in the state, and yet no argument was made to express this position? Why you may ask? Because we don’t truly know, we (OHV advocates) don’t have the resources to process the data, and we don’t have the staff to disseminate it. Assumption is not going to convince our Legislators, we need hard facts. We need a comprehensive annual economic impact report.

 

While a lawsuit is in the works to retrieve the money taken last year, and one can only assume this latest theft will be included, we must ask ourselves how will we fund a lawsuit, which has proven historically an ineffective way of retrieving our funds? How long will this take? Will we even have a program to get the money back into?

 

There seems to be no question our “Green Sticker” revenue of $17 Million is protected, but our program cannot survive with out a steady source of revenue such as the Gas Tax. Programs that prop up services from outside revenue sources will need to be developed, and more important, truly protected. With a history of theft from our Piggy Bank, we will need to look to OHV leadership to develop a plan to continue this valuable California resource and find a way to continue one of the few California programs that has been self sustaining for 40 years, and that may require us to help fix the parks department along the way.  Like our strategic plan for Johnson Valley, the time has come to gather a brain trust from multiple sources, and we need to fund the efforts of those willing to fight to keep our OHV opportunities available.

 

Perhaps the biggest question is where will our elected officials go to fill budget shortfalls after they systematically dismantle a program that has been self sustaining, and a contributor to the greater good of the citizens of this state in times of need. Where will they get extra money if the program fails?

Sources below.

http://ohv.parks.ca.gov/pages/1140/files/ohmvr%202011%20report%20-%20final-web.pdf

http://www.ebudget.ca.gov/pdf/BudgetSummary/BS_SCH10.pdf

http://calchannel.granicus.com/MediaPlayer.php?view_id=7&clip_id=470

http://calchannel.granicus.com/MediaPlayer.php?view_id=7&clip_id=428

About the Author

Jeff Knoll is the former Event Director for the King of the Hammers event. He has raced various classes in SCORE, BITD, MORE, and MDR. Following the California 200, Knoll travelled to Washington, DC to meet with BLM officials regarding the Special Recreation Permit policies of the BLM. Knoll serves on the BLM’s Desert Advisory Sub-Committee regarding Special Recreation Permits. Knoll also drafted language for Nevada’s Senate Bill 156 in 2011 regarding action sports safety.

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