BILL ANALYSIS Ó AB 287 Page 1 CONCURRENCE IN SENATE AMENDMENTS AB 287 (Gordon, et al.) As Amended August 19, 2016 Majority vote -------------------------------------------------------------------- |ASSEMBLY: | |(June 2, 2015) |SENATE: |39-0 |(August 23, | | | | | | |2016) | | | | | | | | | | | | | | | -------------------------------------------------------------------- (vote not relevant) Original Committee Reference: TRANS. SUMMARY: Enacts the Consumer Automotive Recall Safety Act (Act), which would prohibit a dealer or car rental company from loaning or renting a vehicle is subject to a recall until the repair has been made. The Senate amendments largely delete the language passed by the Assembly, and would instead: 1)Require the warranty reimbursement schedule or formula used by every franchisor to be reasonable with respect to the time and compensation allowed to the franchisee for costs directly associated with the disposal of hazardous materials that are associated with a recall repair. AB 287 Page 2 2)Authorize the Department of Motor Vehicles (DMV) to suspend a dealer's license for violation of any provision of the Act, or any rule or regulation adopted pursuant thereto. 3)Require that, no later than 48 hours after receiving notice of a manufacturer's recall or sooner if practicable, a dealer or rental car company with a motor vehicle fleet of 34 or fewer loaner or rental vehicles shall not loan, rent, or offer for loan or rent a vehicle subject to that recall until the recall repair has been made. 4)Authorize the dealer or rental car company, if a recall notification indicates that the remedy for the recall is not immediately available and specifies actions to temporarily repair the vehicle in a manner to eliminate the safety risk that prompted the recall, to loan or rent the vehicle after having the repairs completed. 5)Prohibit the dealer or rental car company from loaning or renting the vehicle until the vehicle has been repaired, once the remedy for the vehicle becomes available to the dealer or rental car company. 6)Require DMV to include in each vehicle registration renewal notice the following recall disclosure statement: NOTICE: Many vehicles have been recalled recently for needed repairs. Did you know you can check to see if your vehicle has an unrepaired manufacturer's safety recall? For most vehicles, manufacturer's safety recalls are repaired for free. You can check for any recalls and how to get the recall repaired at www.safercar.gov. 7)Define the terms "warranty," "dealer," "manufacturer's recall," "recall database," "recall database report," and "rental car company." AB 287 Page 3 8)Revise the legislative findings and declarations 9)Declare that the Act does not create any legal duty upon the dealer, rental car company, or department related to the accuracy, errors, or omissions contained in a recall database report or any legal duty to provide information added to a recall database after the dealer, rental car company, or department obtained the recall database report. 10)Declare that the rights and remedies provided by the Act are cumulative and shall not be construed as restricting any right or remedy that is otherwise available. 11)Declare the provisions of the Act to be severable. 12)Declare that no reimbursement is required pursuant to the California Constitution because the only costs that may be incurred by a local agency or school district will be incurred because this bill creates a new crime or infraction, eliminates a crime or infraction, changes the penalty for a crime or infraction, or changes the definition of a crime. 13)Make other clarifying or nonsubstantive changes. FISCAL EFFECT: According to the Senate Appropriations Committee: 1)Likely minor one-time DMV costs, potentially as high as $50,000, related to the printing of the recall disclosure statement on vehicle registration renewal documents. Ongoing administrative costs would be minor and absorbable. (Motor Vehicle Account) 2)Potential DMV costs beginning in 2017-18 for ongoing dealership inspections and enforcement activities. Staff estimates any additional activities would result in minor AB 287 Page 4 costs. (Motor Vehicle Account) COMMENTS: This bill is intended to address the danger posed by consumers driving cars with unknown or unremedied recall notices by requiring smaller dealers and rental car companies (those with fleets of 34 or fewer cars) to ground automobiles with outstanding recall notices no later than 48 hours after receipt of notice, and either fix or temporarily repair the car before making it available to a consumer. Analysis Prepared by: Hank Dempsey / P. & C.P. / (916) 319-2200 FN: 0004899