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Resolution 2016-09, Junk Vehicle Capital Reserve


It is the intent of the Montana Association of Counties to seek legislation to specifically authorize counties to establish and maintain a county Junk Vehicle Capital Reserve fund and that up to 10% of its annual payment from the junk vehicle program and any unspent budget authority may be transferred into a county junk vehicle capital reserve fund to be used for the replacement, improvement, and acquisition of property, facilities, or equipment consistent with the purposes of the junk vehicle program only, in accordance with a capital improvement plan adopted by a county.

WHEREAS, for many years counties were encouraged by DEQ to establish a junk vehicle capital reserve to save money for large purchases that cannot be funded in a single year; and

WHEREAS, recently the DEQ Junk Vehicle program has decided that funds in county capital reserve funds cannot be retained in a capital reserve fund after June 30, 2016 unless a county submits a Capital Improvement Plan acceptable to DEQ for the use of this money, in which case the time frame will be extended one year; and

WHEREAS,  DEQ has directed all funds remaining in a County Junk Vehicle Capital Reserve be returned to the state; and

WHEREAS,  Section 75-10-534 establishes an annual payment to counties not exceed $1.40 for each motor vehicle under 8,001 pounds gross vehicle weight that is licensed in that county. However, for those counties that have fewer than 5,000 motor vehicles under 8,001 pounds gross vehicle weight, the department may pay up to $7,500 if the county can justify this payment; and

WHEREAS, 75-10-534 does not provide for a reversion of any funds paid to counties, however DEQ has adopted Administrative Rules requiring unspent funds in any fiscal year to be returned to the state; and

WHEREAS, Section 7-6-616 authorizes counties to establish Capital Reserve Funds for the replacement, improvement, and acquisition of property, facilities, or equipment that costs in excess of $5,000 and that has a life expectancy of 5 years or more.  Further Section 7-6-616 states that a capital improvement fund may receive money from any source, including funds that have been allocated in any year but have not been expended or encumbered by the end of the fiscal year; and

WHEREAS, MACo believes that statute prevails over administrative rule, therefore the administrative rule adopted by DEQ is beyond the scope of its authority by requiring a reversion of unspent funds.

NOW, THEREFORE BE IT RESOLVED that the Montana Association of Counties shall seek legislation clearly authorize a county to establish a county junk vehicle capital improvement fund and that up to 10% of its annual payment from the junk vehicle program and any unspent budget authority may be transferred into a county junk vehicle capital reserve fund to be used for the replacement, improvement, and acquisition of property, facilities, or equipment consistent with the purposes of the junk vehicle program only, in accordance with a capital improvement plan adopted by a county.

2016 ACTION

SPONSOR:  Beaverhead County
REFERRED TO: MACo Tax, Budget & Finance Committee
ADOPTED:  Annual Conference, Billings, MT, September 21, 2016