Vehicle License Fee (VLF) Increase Effective May 19, 2009

Online Calculator Will Determine New Vehicle License Fee Due on Vehicle Registration Renewals

New legislation authorizes the Department of Motor Vehicles to increase the Vehicle License Fee (VLF) from 0.65 percent to 1.15 percent when registration fees are due on or after May 19, 2009 for:

• Automobiles
• Commercial vehicles with a declared gross operating weight under 10,001 pounds
• Motorcycles
• Trailer coaches

Vehicle License Fee (VLF) Increase FAQs

Q What is Vehicle License Fee (VLF) and how is the amount determined?
A The VLF was established by the Legislature in 1935 in lieu of a property tax on vehicles. The formula for VLF assessment established by the Legislature is based upon the purchase price of the vehicle or the value of the vehicle when acquired. The VLF decreases with each renewal for the first 11 years. The VLF is part of the total fees due upon initial and annual vehicle registration renewal. This amount will temporarily increase to 1.15 percent for most vehicles effective May 19, 2009.

Q Where does the money go?
A The DMV returns almost all vehicle license fee revenue to the cities and counties. For more details on how your VLF money is used, contact your local city or county government officials.
The VLF revenue of 0.65 percent will continue to be distributed to cities and counties and deposited into the Local Revenue Account and Motor Vehicle License Fee Account in the Transportation Tax Fund. The VLF increase of 0.50 percent will be allocated as follows:

• 0.35 percent to the General Fund
• 0.15 percent transferred to the Local Safety and Protection Account established in the Transportation Tax Fund.

Q Why is the vehicle license fee (VLF) increasing?
A The VLF increase is part of the budget plan designed to reduce California’s $42 billion deficit. The new budget includes spending reductions, revenue increases, economic stimulus, and government efficiency.

Q How much is the VLF increase?
A The current VLF rate is 0.65 percent and will increase to 1.15 percent for most vehicles, an increase of 0.5 percent.

Q When does the increase go into effect?
A The increase does not apply to fees which become due prior to May 19, 2009, whether for original registration or renewal, regardless of when the fees are paid.

Q Which vehicles are affected by the change?
A Most vehicles with fees due on or after May 19, 2009, are subject to the VLF increase. This includes automobiles; commercial vehicles with a declared gross operating weight under 10,001 pounds, motorcycles, and trailer coaches.

Q Which vehicles are exempt from the increase?
A Commercial vehicles with a declared gross vehicle weight or a combined gross vehicle weight of 10,001 pounds or more, vehicles that are exempt from paying vehicle license fees, trailers or semi-trailers in the Permanent Trailer Identification (PTI) Program.

Q Can I pay my fees early to avoid the increase?
A No. The increase is based on the vehicle registration expiration date. Affected vehicles with a fee due date of May 19, 2009, or later will pay the increase regardless of when payment is received.

Q How long does the increase last?
A The increase will be through June 30, 2011, but may be extended to
June 30, 2013.

Q What is the minimum/maximum amount that may be charged for VLF?
A The minimum amount of VLF for any vehicle is one dollar ($1). There is no maximum; the VLF is based on the value of the vehicle.

Q Can I make payments?
A No. All registration fees must be paid in full prior to the expiration date to avoid penalty.

Q Can I pay with a credit card?
A Yes, if your billing notice indicates you are eligible to renew your registration via the Internet (www.dmv.ca.gov) or through DMV’s Automated Voice Recognition service by calling 1-800-777-0133 you can pay by credit card. Credit cards are not accepted at your local field office.

Q What can I do if I cannot afford to pay the registration fees?
A The law requires all fees to be paid before the vehicle is driven, moved, or left standing on a public highway or in a public off-street parking facility (California Vehicle Code §4000). If the vehicle is to be removed from the road, and be eligible for a planned non operation (PNO) the owner must file a PNO with DMV on or before the vehicle expiration date to avoid penalties.

Q What if I did not receive a billing notice, how do I calculate the new VLF?
A You may use the department’s Online Vehicle Registration Fee Calculator available at www.dmv.ca.gov, and click on the More Online Services link to determine the vehicle registration renewal fees due.

Q How can I determine the amount of VLF increase due for my vehicle?
A Generally the increase is approximately $5.00 per $1000 in vehicle value. For example, a vehicle valued at $5,000 (when purchased) would see an increase of approximately $25.00. If your vehicle registration renewal is due within 60 days and you would like a precise calculation visit the Online Vehicle Registration Fee Calculator.