20250AB__178398AMD INTRODUCED 2026-02-09 AMENDED_ASSEMBLY 2026-03-19 2025 AB AMD Introduced by Assembly Member DeMaio LEAD_AUTHOR ASSEMBLY DeMaio

An act to add

Chapter 5.5 (commencing with

Section 16643) to Part of Division of Title of the Government Code, and to add

Chapter 1.2 (commencing with

Section 7283.61) to

Part 1.7 of Division of the Revenue and Taxation Code, relating to vehicle miles. vehicle miles Vehicle miles traveled: local tax and state fund prohibition.

(1) Existing law sets forth various provisions on the use of state funds, including by prohibiting the use of a grant of state funds to assist, promote, or deter union organizing. This bill would prohibit a state agency from expending funds for the study, planning, testing, design, implementation, administration, or evaluation of a tax, fee, assessment, or charge based on vehicle miles traveled (vehicle miles purposes).

The bill would require the reversion of funds appropriated from the General Fund to another fund for vehicle miles purposes and would require the deobligation of encumbered but unexpended funds for those purposes. The bill would require the Department of Finance to, within days of January 1, 2027, identify all relevant appropriations and ensure their reversion or transfer. The bill would additionally prohibit any future Budget Act from appropriating funds for vehicle miles purposes unless expressly authorized by statute, as described. Existing</xhtml:p>"?>

(2) Existing law authorizes the legislative body of a city or county to impose various taxes, including occupancy taxes and sales and use taxes. Existing law also prohibits a city and county form imposing certain taxes, such as a tax upon income. This bill would prohibit a city, county, or any political subdivision thereof from imposing a tax, fee, assessment, or charge, that is calculated, in whole or in part, based on the number of miles traveled by a motor vehicle. The bill would not prohibit the collection of tolls for the use of specific facilities, as provided.

The bill would provide that any existing program, pilot program, regulation, or administrative action inconsistent with this prohibition is void and unenforceable. The bill would include findings that changes proposed by this bill address a matter of statewide concern rather than a municipal affair and, therefore, apply to all cities, including charter cities. MAJORITY NO YES NO NO NO NO NO NO NO NO The people of the State of California do enact as follows:

SECTION 1.

Chapter 5.5 (commencing with

Section 16643) is added to Part of Division of Title of the Government Code , to read: 5.5. Prohibition on Use of State Funds 16643. (

a) Notwithstanding any other law, including any provision of the annual Budget Act or any other statute making an appropriation, a state agency shall not expend funds for the study, planning, testing, design, implementation, administration, or evaluation of a tax, fee, assessment, or charge based on vehicle miles traveled. (

b) Any funds appropriated from the General Fund to another fund for the purposes described in subdivision (

a) that remain unencumbered as of January 1, 2027, shall revert to the General Fund to the extent permissible by law. (

c) Any encumbered but unexpended funds for the purposes described in subdivision (

a) shall be deobligated to the extent permissible by law and returned to the General Fund. (

d) The Department of Finance shall, within days of January 1, 2027, identify all appropriations subject to this

section and ensure their reversion or transfer pursuant to subdivisions (

b) and (c). (

e) Any future Budget Act shall not appropriate funds for the purposes described in subdivision (

a) unless expressly authorized by statute that is enacted after January 1, 2027, and that specifically references this section.

SEC. 2.

Chapter 1.2 (commencing with

Section 7283.61) is added to

Part 1.7 of Division of the Revenue and Taxation Code , to read: 1.2. Vehicle Miles Traveled Tax 7283.61. (

a) Notwithstanding any other law, a city, county, or any political subdivision thereof, shall not impose, administer, collect, or enforce a vehicle miles traveled tax or a mileage-based tax. (

b) For purposes of this section, a “vehicle miles traveled tax” or “mileage-based tax” means a tax, fee, assessment, or charge that is calculated, in whole or in part, based on the number of miles traveled by a motor vehicle, and shall include, but not be limited to, any tax, fee, assessment, or charge that is:

(1) Directly assessed per mile traveled.

(2) Calculated using odometer readings, telematics data, Global Positioning System (GPS) data, or any similar mileage-tracking method.

(3) Imposed as a replacement for, supplement to, or offset of fuel excise taxes, registration fees, or other transportation-related charges. (

c) This

section does not prohibit the collection of tolls for the use of specific facilities, provided the tolls are not calculated based on total vehicle miles traveled beyond the tolled facility. (

d) Any program, pilot program, regulation, or administrative action inconsistent with this

section is void and unenforceable.

SEC. 3. The Legislature finds and declares that

Section of this act adding

Section 7283.61 of the Revenue and Taxation Code address a matter of statewide concern rather than a municipal affair as that term is used in

Section of

Article XI of the California Constitution. Therefore,

Section of this act applies to all cities, including charter cities.