California Sued Over Smog Tax on Cars Brought In

Nobody likes car taxes, particularly in California, where high sales taxes, tough licensing fees and steep insurance rates make the cost of operating a car particularly onerous.

So the Legislature surely thought it found the perfect new car tax in 1990 when it enacted the smog-impact fee. It’s a $300-per-car levy that folks moving into the Golden State have to pay for the privilege of registering a vehicle here.

The concept of the smog-impact fee was that cars not originally certified as California vehicles pollute more and therefore should have to pay an impact fee.

But critics of the tax say that all cars must pass the same smog test to get a license plate in California. Moreover, the mechanical differences between California cars and those sold in the 49 other states have narrowed dramatically over time, and in many cases the mechanical systems are now identical.

The idea of imposing a sizable tax when there is no smog impact from a car, and forcing individuals with no political power in California to pay the tax, cannot possibly be constitutional, according to four lawsuits, since consolidated, that have been filed against the state in Superior Court.

“These people are not California voters and they are an easy target,” said Bill Dato, an attorney with Milberg Weiss Bershad Hynes & Lerach, the San Diego law firm that is pressing the case against the Department of Motor Vehicles. “So they have targeted people who have no political power in California.”

Last year, a Sacramento judge agreed with the arguments against the tax and ruled that the tax represents an infringement on the U.S. Constitution’s interstate commerce clause. Under the judgment, individuals who paid the levy as far back as September 1992 could receive refunds.

The DMV, which collects the tax and administers the program, has appealed the ruling. In the meantime, however, the department is continuing to collect the tax. It has also elected not to notify individuals that the law was declared unconstitutional and that they may be eligible for refunds, Dato said.

The smog-impact fee has been a huge money machine for California, raising $68.7 million in the 1997-98 fiscal year--a fee imposed on a quarter-million vehicles brought into California, according to DMV figures. The receipts are up from $62 million in the prior year and $45 million back in 1994-95--a whopping 53% tax revenue increase in just three years. If California loses the suit and is forced to refund past fees, the liability will reach into the hundreds of millions of dollars.

Critics of the levy include some longtime California residents, who have encountered it when buying out-of-state vehicles. Larry Fafarman, an Angeleno for most of his life, made the mistake of purchasing a 1990 Pontiac Grand Am from out of state a few years ago. He has since formed the Committee Against Unconstitutional Smog Taxes in California, or CAUSTIC.

“I was so annoyed by the whole idea that I took action,” he said.

*

The basis for the smog-impact fee goes back to the 1970s, when Congress first began regulating vehicle emissions. California wanted a set of regulations separate from federal standards, saying it was less concerned about carbon monoxide emissions that ranked high in the rest of the country and more concerned about oxides of nitrogen.

Of course, those are the gases that produce smog, and California is expanding its efforts to reduce them. But through the years, the differences in cars themselves have narrowed considerably, and many new cars have identical emissions system for all 50 states, according to both Dato and Fafarman.

But Tracey Weatherby, a spokeswoman for the Bureau of Automotive Repair, which runs California’s smog-check program, said that cars certified for sale here do have lower emissions and that the smog-impact fee reflects the fact that California cars carry higher prices for smog equipment than do cars sold elsewhere.

Weatherby added that even if cars from out of state pass a smog test, they may still emit more pollutants than a California-certified car.

Fafarman disputes that assessment, saying: “There is no basis for discrimination between vehicles that pass the smog check. It is only fair that all vehicles that pass the test should be treated equally.”

*

Times staff writer Ralph Vartabedian will attempt to respond in this column to automotive questions of general interest. Write to Your Wheels, Business Section, Los Angeles Times, Los Angeles CA 90053. Via e-mail: [email protected].