CA SB321

Modifies the motor vehicle fuel excise tax rate adjustment process starting with the 2016-17 fiscal year, requiring the State Board of Equalization to adjust rates on or before March 1 each year based on a combined average of actual fuel prices from the previous four fiscal years and estimated fuel prices for the current fiscal year.

Maintains the requirement that rate adjustments generate revenue equal to the amount lost from the motor vehicle fuel sales and use tax exemption, ensuring revenue neutrality year to year.

Removes a provision that allowed more frequent rate adjustments (every six months) if the Board determined revenues would differ significantly from estimates due to fuel price or consumption changes.

Sets the base motor vehicle fuel excise tax at 17.3 cents per gallon, with the possibility of recalculation if federal fuel tax rates drop below 9 cents per gallon and federal highway funding is correspondingly reduced.

Ensures that tax adjustments under this law do not produce a net revenue gain in state taxes, maintaining the revenue-neutral intent of the original 2011 legislation.