BILL ANALYSIS Ó
SENATE COMMITTEE ON APPROPRIATIONS
Senator Ricardo Lara, Chair
2015 - 2016 Regular Session
AB 287 (Gordon) - Vehicle safety: recalls
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|Version: August 2, 2016 |Policy Vote: T. & H. 11 - 0, |
| | JUD. 7 - 0 |
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|Urgency: No |Mandate: Yes |
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|Hearing Date: August 8, 2016 |Consultant: Mark McKenzie |
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This bill meets the criteria for referral to the Suspense File.
Bill
Summary: AB 287 would require the Department of Motor Vehicles
(DMV) to notify vehicle owners on their registration renewal
notice if a vehicle is subject to a manufacturer's recall, as
specified. The bill would also prohibit a dealer or rental car
company from loaning or renting a vehicle is subject to a recall
until the repair has been made.
Fiscal
Impact:
Unknown one-time DMV costs, potentially in the range of
$75,000 to $150,000, to contract with an outside entity to
provide vehicle recall database reports for vehicles subject
to registration renewal. (Motor Vehicle Account)
One-time DMV programming costs of approximately $125,000 to
make IT changes to the vehicle registration database systems
AB 287 (Gordon) Page 1 of
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to provide for the vehicle recall disclosure. Timing of the
programming would depend upon when the DMV declares that it
has access to a recall database and funding available to
provide the disclosure on vehicle registration renewals.
(Motor Vehicle Account)
Ongoing DMV costs of approximately $580,000 for field office
and call center staff time to respond to inquiries about the
recall notices, assuming a small percentage of the 4.5 - 5
million registration renewal customers request additional
information.
Potential DMV costs beginning in 2017-18 for ongoing
dealership inspections and enforcement activities. Staff
estimates any additional activities would result in minor
costs. (Motor Vehicle Account)
Background: Vehicle safety recalls are necessary when a motor vehicle or
item of vehicle equipment does not comply with a Federal Motor
Vehicle Safety Standard, or when there is a safety-related
defect in the vehicle or equipment. The National Highway
Traffic Safety Administration (NHTSA) has the authority under
federal law to require manufacturers to recall vehicles that
have safety defects or do not meet safety standards. If a
safety defect is identified, manufacturers are required to
notify the NHTSA, owners, dealers and distributors, and, correct
the defect at no change (unless the vehicle is more than 10
years old), and vehicle dealers are prohibited from selling a
new vehicle subject to a recall, unless the defect is repaired.
Federal law requires motor vehicle safety information to be
publicly available online and searchable by vehicle make, model,
and vehicle identification number (VIN). Federal law also
prohibits rental car companies and vehicle dealers with 35 or
more available vehicles from renting or loaning vehicles that
are subject to a safety recall.
From 1995 to 2015, the number of vehicle recalls has almost
tripled, from 348 to 973, with more than 87 million vehicles
affected in 2015. The recall of Takata airbags impacts as many
as 68.8 million airbags in what NHTSA called the largest and
most complex safety recall in history. Despite the large number
of affected vehicles, NHTSA has estimated that only 70% of
recalled vehicles are repaired. To improve that record, the
NHTSA established a website where the public can determine
AB 287 (Gordon) Page 2 of
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whether a vehicle is subject to recall: www.safercar.gov .
Proposed Law:
AB 287 would prohibit the renting or loaning of vehicles
subject to a recall, and require DMV to notify vehicle owners on
registration renewal documents if their vehicle is subject to a
recall. Specifically, this bill would:
Prohibit a dealer or rental car company from loaning or
renting a vehicle subject to a recall until the recall repair
is performed. If a remedy is not immediately available but a
temporary repair is available to eliminate the safety risk,
the dealer or rental company may rent or loan a vehicle after
the repair is made, but must make the recall repair when the
remedy is available.
Require DMV to include a specified recall disclosure statement
on the notice of registration renewal for a vehicle subject to
a manufacturer's recall.
Require DMV to obtain a recall database report before mailing
a notice of registration renewal, and require DMV to notify
the registered owner if a vehicle is subject to a recall by
checking a box next to the recall disclosure statement.
Specify that the DMV recall disclosure requirements are
operative on the date the director of DMV executes a
declaration certifying that DMV has appropriate access to the
necessary data within a recall database and available funding
to include a recall disclosure statement on registration
renewal documents. The declaration must be posted on the DMV
website and sent to the Legislature.
Clarify that automobile manufacturers are liable for costs
associated with the disposal of hazardous materials associated
with a recall through a specified reimbursement of dealer
costs to make the recall repair.
Specify that the bill would become operative on July 1, 2017,
except as specified.
Related
Legislation: SB 686 (Jackson) would have prohibited a vehicle
dealer from selling, leasing, or loaning a used vehicle if the
dealer knows or should have known that the vehicle is subject to
a manufacturer's safety recall, unless repairs are made to
AB 287 (Gordon) Page 3 of
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correct the defect have been performed. This bill failed
passage in the Assembly Business, Professions, and Consumer
Protection Committee in 2014.
AB 753 (Monning) would have expressly prohibited a rental car
company from renting a vehicle that is subject to a recall
notice unless the vehicle has been repaired as specified in the
notice. This bill was held without a hearing in this committee
in 2011 at the request of the author.
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