RV sales in California might rebound quickly now that Gov. Arnold Schwarzenegger has reduced the state’s Department of Motor Vehicles (DMV) fee by two-thirds, according to Ernie Friesen, principal of All Seasons RV Center in Yuba City, Calif., and chairman of the California Recreation Dealers Association (CalRVDA) Government Relations Committee.
California’s car and RV license fees tripled on Oct. 1 and Friesen believes a significant number of prospective RV buyers delayed their purchases to await the outcome of the recall election.
But Swarzenegger issued an executive order today (Nov. 17), two hours after he was sworn in as governor, to roll back the tax. Consequently, RV dealers in California may soon benefit from the pent-up demand that had developed since the beginning of October, Friesen said.
The tripling of the state’s DMV fee, from 0.65% to 2%, was one of the main reasons why Swarzenegger’s predecessor, Gray Davis, was defeated in the recall election on Oct. 7, Friesen believes.
The fee is based on the retail price of a motorhome or towable RV, he said. In the case of a $200,000 diesel pusher, the DMV fee soared to $4,000 from $1,300.
Swarzenegger rolled the DMV fee back to 0.65%.
To offset the impact from lower DMV fee collections and to eliminate the state’s budget shortfall, Swarzenegger is believed to be considering a bond issue in the range of $15 billion to $20 billion, according to political observers.
Friesen, whose dealership is located in Northern California, said the higher DMV fee made it more difficult to compete with dealers in neighboring Oregon, where taxes and fees related to RV sales are much lower.