Amends existing law to revise provisions regarding apportionment of the Highway Distribution Account, to remove a limitation regarding revenues received from fuel taxes, and to revise a provision regarding the distribution of the tax on special fuels.

LEGISLATURE OF THE STATE OF IDAHO Sixty-eighth Legislature Second Regular Session - 2026 IN THE HOUSE OF REPRESENTATIVES HOUSE BILL NO. 716 BY TRANSPORTATION AND DEFENSE COMMITTEE AN ACT1 RELATING TO TRANSPORTATION FUNDING; AMENDING SECTION 40-701, IDAHO CODE, TO2 REVISE PROVISIONS REGARDING APPORTIONMENT OF THE HIGHWAY DISTRIBUTION3 ACCOUNT, TO REMOVE A PROVISION REGARDING FEES ON ELECTRIC AND HYBRID4 VEHICLES, AND TO MAKE A TECHNICAL CORRECTION; AMENDING SECTION 63-2412,5 IDAHO CODE, TO REVISE A DISTRIBUTION TO THE LOCAL BRIDGE INSPECTION6 FUND, TO REVISE A LIMITATION REGARDING REVENUES RECEIVED FROM FUEL7 TAXES, AND TO MAKE TECHNICAL CORRECTIONS; AMENDING SECTION 63-2418,8 IDAHO CODE, TO REVISE A PROVISION REGARDING THE DISTRIBUTION OF THE TAX9 ON CERTAIN SPECIAL FUELS AND TO MAKE A TECHNICAL CORRECTION; AND DECLAR-10 ING AN EMERGENCY AND PROVIDING AN EFFECTIVE DATE.11

Be It Enacted by the Legislature of the State of Idaho:12

SECTION 1. That Section 40-701, Idaho Code, be, and the same is hereby13 amended to read as follows:14 40-701. HIGHWAY DISTRIBUTION ACCOUNT -- APPORTIONMENT. (1) There is15 established in the state treasury an account known as the "Highway Distribu-16 tion Account," to which shall be credited:17 (a) Moneys as provided by sections 63-2412(1)(f)4. and 63-2418(4),18 Idaho Code;19 (b) All moneys collected by the department, their its agents and ven-20 dors, and county assessors and sheriffs, under the provisions of title21 49, Idaho Code, except as otherwise specifically provided for; and22 (c) All other moneys as may be provided by law.23 (2)(a) The highway distribution account shall be apportioned as fol-24 lows:25 (a) Thirty-eight percent (38%) in fiscal year 2021, thirty-eight and26 one-half percent (38.5%) in fiscal year 2022, thirty-nine percent (39%)27 in fiscal year 2023, thirty-nine and one-half percent (39.5%) in fis-28 cal year 2024, thirty-nine and three-quarters percent (39.75%) in fis-29 cal year 2025, and forty percent (40%) thereafter to local units of gov-30 ernment as provided in section 40-709, Idaho Code;31 (b) Fifty-seven percent (57%) in fiscal year 2021, fifty-seven and one-32 half percent (57.5%) in fiscal year 2022, fifty-eight percent (58%) in33 fiscal year 2023, fifty-eight and one-half percent (58.5%) in fiscal34 year 2024, fifty-nine and one-quarter percent (59.25%) in fiscal year35 2025, and sixty percent (60%) thereafter to the state highway account36 established in section 40-702, Idaho Code; and37 (c) Five percent (5%) in fiscal year 2021, four percent (4%) in fiscal38 year 2022, three percent (3%) in fiscal year 2023, two percent (2%) in39 fiscal year 2024, one percent (1%) in fiscal year 2025, and zero dol-40 lars thereafter to the law enforcement account, established in section41 67-2914, Idaho Code. The state controller shall cause the remittance of42

2 the moneys apportioned to local units of government not later than Jan-1 uary 25, April 25, July 25 and October 25 of each year, and to the law2 enforcement account and the state highway account as the moneys become3 available to the highway distribution account.4 (i) Forty percent (40%) to local units of government as provided5 in section 40-709, Idaho Code; and6 (ii) Sixty percent (60%) to the state highway account established7 in section 40-702, Idaho Code.8 (b) The state controller shall cause the remittance of the moneys ap-9 portioned to local units of government no later than January 25, April10 25, July 25, and October 25 of each year and to the state highway account11 as the moneys become available to the highway distribution account.12 (3) All new revenues generated by increases in registration fees and13 fees on electric and hybrid vehicles pursuant to the provisions of House Bill14 No. 312, as amended in the Senate, as amended in the Senate, during the first15 regular session of the sixty-third Idaho legislature, and all revenues gen-16 erated by fees on electric and plug-in hybrid vehicles pursuant to the provi-17 sions of section 49-457, Idaho Code, shall be apportioned as follows:18 (a) Forty percent (40%) to local units of government as provided in sec-19 tion 40-709, Idaho Code; and20 (b) Sixty percent (60%) to the state highway account established in21 section 40-702, Idaho Code.22 (4) (3) Interest earned on the investment of idle moneys in the highway23 distribution account shall be paid to the highway distribution account.24 (5) (4) All idle moneys in the dedicated highway trust or asset accounts25 or subaccounts established from highway user revenues, reimbursements, fees26 or permits shall be invested by the state treasurer in the same manner as pro-27 vided under section 67-1210, Idaho Code, with respect to other surplus or28 idle moneys in the state treasury. Interest earned on the investments shall29 be returned to the various highway trust or asset accounts and subaccounts.30

SECTION 2. That Section 63-2412, Idaho Code, be, and the same is hereby31 amended to read as follows:32 63-2412. DISTRIBUTION OF TAX REVENUES FROM TAX ON GASOLINE AND AIR-33 CRAFT ENGINE FUEL. (1) The revenues received from the taxes imposed by sec-34 tions 63-2402 and 63-2421, Idaho Code, upon the receipt or use of gasoline,35 and any penalties, interest, or deficiency additions, shall be distributed36 periodically as follows:37 (a) An amount of money equal to the actual cost of collecting, admin-38 istering and enforcing the gasoline tax requirements by the commission,39 as determined by it, shall be retained by the commission. The amount re-40 tained by the commission shall not exceed the amount authorized to be41 expended by appropriation by the legislature. Any unencumbered balance42 in excess of the actual cost of collecting, administering and enforcing43 the gasoline tax requirements by the commission at the end of each fis-44 cal year shall be distributed as listed in paragraph (f) of this subsec-45 tion.46 (b) An amount of money shall be distributed to the state refund account47 sufficient to pay current refund claims. All refunds authorized by the48

3 commission to be paid shall be paid from the state refund account, and1 those moneys are hereby continuously appropriated for that purpose.2 (c) As soon as possible after the beginning of each fiscal year, the sum3 of two hundred fifty thousand dollars ($250,000) shall be distributed4 to the railroad grade crossing protection account in the dedicated5 fund, to pay the amounts from the account fund pursuant to the provi-6 sions of section 62-304C, Idaho Code.7 (d) As soon as possible after the beginning of each fiscal year, the sum8 of one hundred seventy-five thousand dollars ($175,000) three hundred9 thousand dollars ($300,000) shall be distributed to the local bridge10 inspection account in the dedicated fund, to pay the amounts from the11 account pursuant to the provisions of section 40-703, Idaho Code.12 (e) An amount of money equal to seven percent (7%) shall be distributed13 to the state highway account established in section 40-702, Idaho Code.14 (f) From the balance remaining with the commission after distributing15 the amounts in paragraphs (a) through (e) of this subsection:16 1. One and twenty-eight hundredths percent (1.28%) shall be17 distributed as follows: sixty-six percent (66%) of the one and18 twenty-eight hundredths percent (1.28%) shall be distributed to19 the waterways improvement fund, as created in chapter 15, title20 57, Idaho Code. Up to twenty percent (20%) of the moneys dis-21 tributed to the waterways improvement account fund under the22 provisions of this paragraph may be used by the department of parks23 and recreation to defray administrative costs. Any moneys un-24 used at the end of the fiscal year by the department of parks and25 recreation shall be returned to the state treasurer for deposit26 in the waterways improvement account fund. Thirty-three percent27 (33%) of the one and twenty-eight hundredths percent (1.28%) shall28 be distributed into the park and recreation capital improvement29 account as created in section 57-1801, Idaho Code. One percent30 (1%) of the one and twenty-eight hundredths percent (1.28%) shall31 be distributed to the search and rescue fund created in section32 67-2913, Idaho Code;33 2. One and twenty-eight hundredths percent (1.28%) shall be34 distributed as follows: sixty-six percent (66%) of the one and35 twenty-eight hundredths percent (1.28%) shall be distributed to36 the off-road motor vehicle account, as created in section 57-1901,37 Idaho Code. Up to twenty percent (20%) of the moneys distributed38 to the off-road motor vehicle account by this subparagraph may be39 used by the department of parks and recreation to defray adminis-40 trative costs. Any moneys unused at the end of the fiscal year by41 the department of parks and recreation shall be returned to the42 state treasurer for deposit in the off-road motor vehicle account.43 Thirty-three percent (33%) of the one and twenty-eight hundredths44 percent (1.28%) shall be distributed into the park and recreation45 capital improvement account as created in section 57-1801, Idaho46 Code. One percent (1%) of the one and twenty-eight hundredths47 percent (1.28%) shall be distributed to the search and rescue fund48 created in section 67-2913, Idaho Code; and49

4 3. Forty-four hundredths percent (.44%) shall be distributed to1 the park and recreation capital improvement account as created2 in section 57-1801, Idaho Code, to be used solely to develop,3 construct, maintain and repair roads, bridges and parking areas4 within and leading to parks and recreation areas of the state.5 4. The balance remaining shall be distributed to the highway dis-6 tribution account created in section 40-701, Idaho Code.7 (2) Provided however, the distribution pursuant to subsection (1) of8 this section of revenues received from the taxes imposed pursuant to section9 63-2402(2), Idaho Code, shall apply only to twenty-five cents (25¢) of ev-10 ery thirty-two cents (32¢) received. The remaining seven cents (7¢) of ev-11 ery thirty-two cents (32¢) received pursuant to the provisions of section12 63-2402(2), Idaho Code, shall be distributed as follows: to the highway dis-13 tribution account created in section 40-701, Idaho Code.14 (a) Sixty percent (60%) to the state highway account; and15 (b) Forty percent (40%) to be distributed pursuant to the provisions of16 section 40-709, Idaho Code, in the same manner as distribution of mon-17 eys appropriated from the highway distribution account to local units18 of government.19 (3) The revenues received from the taxes imposed by section 63-2408,20 Idaho Code, and any penalties, interest, and deficiency amounts, shall be21 distributed as follows:22 (a) An amount of money shall be distributed to the state refund account23 sufficient to pay current refund claims. All refunds authorized by the24 commission to be paid shall be paid from the state refund account, and25 those moneys are hereby continuously appropriated.26 (b) The balance remaining of all the taxes collected shall be dis-27 tributed to the state aeronautics fund, as provided in section 21-211,28 Idaho Code.29

SECTION 3. That Section 63-2418, Idaho Code, be, and the same is hereby30 amended to read as follows:31 63-2418. DISTRIBUTION OF TAX REVENUES FROM TAX ON SPECIAL FUELS. Un-32 less as otherwise provided in subsection (5) of this section, revenues re-33 ceived from the tax imposed by this chapter upon the receipt of special fuel34 and any penalties, interest or deficiency additions, or from the fees im-35 posed by the commission under the provisions of section 63-2424 or 63-2438,36 Idaho Code, shall be distributed as follows:37 (1) An amount of money equal to the actual cost of collecting, adminis-38 tering and enforcing the special fuels tax provisions by the commission, as39 determined by it, shall be retained by the commission. The amount retained40 by the commission shall not exceed the amount authorized to be expended by41 appropriation by the legislature. Any unencumbered balance in excess of the42 actual cost of collecting, administering and enforcing the special fuels tax43 requirements by the commission at the end of each fiscal year shall be dis-44 tributed to the highway distribution account.45 (2) An amount of money shall be distributed to the state refund account46 sufficient to pay current refund claims. All refunds authorized by the com-47 mission to be paid under this chapter shall be paid from the state refund ac-48 count, those moneys being hereby continuously appropriated.49

5 (3) An amount of money equal to seven percent (7%) shall be distributed1 to the state highway account as established in section 40-702, Idaho Code.2 (4) The balance remaining with the commission after distributing the3 amounts specified in subsections (1), (2) and (3) of this section shall4 be distributed to the highway distribution account established in section5 40-701, Idaho Code.6 (5) For those special fuels subject to tax pursuant to section 63-24027 or 63-2424, Idaho Code, twenty-five cents (25¢) of every thirty-two cents8 (32¢) of revenue received from such tax shall be distributed pursuant to the9 provisions of subsections (1), (2), (3) and (4) of this section. The remain-10 ing seven cents (7¢) of every thirty-two cents (32¢) of the revenue received11 shall be distributed as follows: to the highway distribution account cre-12 ated in section 40-701, Idaho Code.13 (a) Sixty percent (60%) to the state highway account; and14 (b) Forty percent (40%) to be distributed pursuant to the provisions of15 section 40-709, Idaho Code, in the same manner as distribution of mon-16 eys appropriated from the highway distribution account to local units17 of government.18

SECTION 4. An emergency existing therefor, which emergency is hereby19 declared to exist, this act shall be in full force and effect on and after20 July 1, 2026.21