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Measurement standards fee increase

Senate Bill 238

License fees for weighing and measuring devices increased 5% for the license period that began on July 1, 2009. 
The 2007 Legislative Assemply passed Senate Bill 238 to maintain a viable inspection program. SB238 raised the maximum license fees the division can charge for weighing and measuring devices.
Instead of raising the fees all at one time, the division opted to phase in the increase.

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Why fees were increased in 2007

Weights and measures program needed more funds
At that time, device license fees for commercially used weighing and measuring devices needed to be increased for licenses beginning July 1, 2007.  To maintain a viable program device license fees needed to be increased to cover the cost of the program.  Prior to the 2007 increase, license fees had not been increased since 1992.  In that time period the number of licensed devices increased from around 39,000 to approximately 54,000 in 2007.  Additional positions were added in 1998 to cover inspections of the increasing number of devices, which equated to higher personnel costs. In addition, the cost of testing continues to increase.  Equipment costs, travel costs and increases in fuel costs all drive up the cost of testing devices.

Program was losing money
In each of the 01/03 and 03/05 bienniums, expenditures exceeded revenue by approximately 1.5 million dollars. The existing cash balance was used to make up for this deficit, which had been depleted requiring a license fee increase be implemented in the 07/09 biennium to maintain a viable program.

Cost cutting measures
We continue to work efficiently to keep costs down. This includes extending the service life on equipment as applicable, working flex schedules, and locating inspectors geographically to maximize inspection time while minimizing travel costs.  However, with new and constantly changing technology in weighing and measuring devices, training, testing methodology and testing equipment continually need to be modified and updated.

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Amount of fee increase

How the amount of the fee increase was determined
The amount that each device license type was under funded was determined by taking into account the average amount of time it takes to test the device type, the number of devices licensed, and the personnel costs, program costs and equipment required for testing. Increasing license fees allowed the division to again be fully staffed, provide annual inspections, conduct special request testing, and respond to consumer complaints in a timely manner.

Why such a large increase?
The division had not previously had a device license fee increase since 1992. Under SB 238 some device types had no license fee increase, some moderate increases, and some substantial increases based on how much that device type was under funded. The overall program increase was consistent with the Consumer Price Index for the same time period.

Why is the fee increasing in 2009?
SB238 set the maximum fee the division may charge to license weighing and measuring devices. The division opted to phase in the fee increase instead of raising fees to the maximum back in 2007.
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Advisory group

Working with an advisory group
The Measurement Standards Division began working with an industry advisory group in 2005. A complete breakdown of program costs, costs of testing each device type and possible solutions were presented and discussed. The advisory group supported the need for a viable program. The advisory group presented HB2402 as a funding means that would raise 25% of the needed revenue through license fee increases and the remaining 75% shortfall through General Fund appropriations. However, the General Fund portion was not included in the Co-Chairs budget. The department then introduced SB238 that would generate the needed revenue through license fee increases on devices. The amount of the license fee increase for each device type was determined by the cost of testing and the amount that device type was under funded.

Advisory group members
Bruce Anderson Northwest Food Processors Assn.
Lana Butterfield
Northwest Propae Gas Assn.
Brian Doherty
Western States Petroleum Assn.
Dan Floyd
Northwest Grocery Assn.
Joe Gilliam
Northwest Grocery Assn.
Jim Jones
Oregon Petroleum Assn.
Richard Kosesan
Convenience store representative
Sharon Livingston Oregon Cattleman's Assn.
John McCulley
Food processors representative
Shawn Miller
Northwest Grocery Assn.
Kay Teisl
Oregon Cattleman's Assn.
Jim Welsh Oregon Cattleman's Assn.

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Legislative involvement

SB 238 established new maximums for weighing and measuring device license fees. The bill passed committees in both the Senate and House, and the bill was part of the Governor's Recommended Budget. During open testimony industry testified supporting the weights and measures program while emphasizing the wish for some General Fund monies for the program.

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Value of current program

Customer satisfaction surveys
Customer satisfaction surveys are sent annually to randomly selected customers that interacted with the division. Customers are asked to rate the division in terms of timeliness, accuracy, helpfulness, expertise, availability of information, and overall level of service. In 2008, over 91% of customers surveyed rated Measurement Standards as providing excellent or good overall service.

What the license fee increase did for the program
We were able to begin filling vacant positions and training new field staff. These key positions conduct inspections, do special request testing, and respond to consumer complaints in a timely manner.  In addition, in most instances, we are able to provide a retest for devices that have been rejected to ensure that the device was corrected to meet all applicable requirements.

Importance of annual inspections
Annual inspections are critical in ensuring equity in trade for both the buyer and seller.  With billions of dollars worth of commerce changing hands annually in Oregon through commercially used weighing and measuring devices, unannounced inspections help maintain a level playing field and are a detriment to the facilitation of fraud.  With over 2 billion gallons of gasoline and diesel sold annually in Oregon, inaccurate devices in the market place could have a huge effect.

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Long-term outlook

With input from our advisory group, the division will continue looking for ways to operate efficiently, while maintaining an effective program. The license fees established in SB238 reached the maximum cap in 2009. The advisory group added an amendment to SB238 to allow a maximum 2% annual license fee increase for inflation for five years beginning July 1, 2011. This was done to keep the amount of fee increases at a minimum amount but implemented on a more frequent basis, thus avoiding being faced with the need to implement substantial increases to catch up with program costs. The division will continue to work with the advisory group to ensure the most efficient and viable program possible.
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More information

Please visit our device license page for a breakdown of device types, license types, and fee requirements.
Email further questions to msd-info@oda.state.or.us .

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