Use Fuel Tax Law: Diesel Fuel Tax Law: exempt bus operation.

Senator Niello's proposal to expand California's fuel tax exemptions would extend existing transit system tax relief to county-operated local transit services. The measure modifies both the Use Fuel Tax Law and Diesel Fuel Tax Law to include counties alongside transit districts, transit authorities, and cities that currently qualify for exemptions from the state's $0.18 per gallon fuel tax.

Under the amended provisions, counties operating local transit systems, either directly or through wholly owned nonprofit corporations, would pay one cent per gallon of exempt fuel used - the same nominal fee required of other exempt transit operators. The exemptions exclude charter-party carriers of passengers and maintain existing provisions for private transportation entities operating under public agency contracts, as well as school transportation services.

The bill's tax levy provisions would take effect immediately upon enactment, with operational changes beginning in the first calendar quarter more than 90 days after the effective date. County transit operators would submit their per-gallon payments to the State Board of Equalization under the board's established collection procedures.