BILL ANALYSIS Ó AB 516 Page 1 ASSEMBLY THIRD READING AB 516 (Mullin) As Amended June 1, 2015 Majority vote ------------------------------------------------------------------- |Committee |Votes |Ayes |Noes | | | | | | | | | | | |----------------+------+---------------------+---------------------| |Transportation |16-0 |Frazier, Achadjian, | | | | |Baker, Bloom, Chu, | | | | |Daly, Dodd, Eduardo | | | | |Garcia, Gomez, Kim, | | | | |Linder, Medina, | | | | |Melendez, Nazarian, | | | | |O'Donnell, Santiago | | | | | | | |----------------+------+---------------------+---------------------| |Appropriations |12-0 |Gomez, Bonta, | | | | |Calderon, Daly, | | | | |Eggman, | | | | | | | | | | | | | | |Eduardo Garcia, | | | | |Gordon, Holden, | | | | |Quirk, Rendon, | | | | |Weber, Wood | | | | | | | | | | | | ------------------------------------------------------------------- AB 516 Page 2 SUMMARY: Requires the Department of Motor Vehicles (DMV) to develop and implement an electronic vehicle report of sale system and permits vehicles sold or leased without a permanent license plate to be affixed with a temporary license plate (TLP). Specifically, this bill: 1)Requires a dealer or lessor to use the electronic report of sale system and attach a TLP on a vehicle sold or leased that does not display license plates, as specified. 2)Permits a vehicle to operate with TLPs or a report of sale form until either: a) The permanent license plates and registration card are received by the vehicle owner; or, b) Ninety days have lapsed from the vehicle's selling date. 1)Requires DMV to develop a system for dealers and lessor-retailers to electronically report the sale of a vehicle, as specified. 2)Provides that the electronic report of sale system will produce TLP's for vehicle's sold or leased that do not display license plates and specifies the TLP will display a report of sale number, expiration date, and any other information as determined by DMV. 3)Requires a dealer to assign each transaction with a unique report of sale number that will be used on all report of sale forms and TLP for a vehicle. AB 516 Page 3 4)Requires the electronic report of sale system to record the vehicle identification number, the vehicle year, model, and make, the dealer or lessor-retailer purchaser name, and any other information as determined by DMV. 5)Requires the electronic report of sale system to be developed and made available to dealers by no later than January 1, 2018. 6)Specifies that it is a felony for a person to alter, forge, counterfeit, or falsify a TLP. 7)Authorizes DMV to charge an administrative fee to applicable public agencies for processing delinquent parking violations and toll evasion violations to cover the cost of administering the electronic report of sale system. 8)Requires TLPs to be affixed to the vehicle and requires the owner to remove TLPs upon receipt of permanent plates. 9)Makes additional technical and conforming changes in order to implement and enforce DMV's electronic report of sale system. FISCAL EFFECT: According to the Assembly Appropriations Committee, DMV estimates costs of $2.4 million in 2016-17 to design, develop, and build the Report of Sale/Temporary License Plate system, offset by temporarily increasing the administrative service fee paid by toll and parking authorities to DMV to assist in the collection of unpaid fines. Ongoing costs associated with maintenance of the ROS/TLP system are estimated at $940,000, offset by savings related to the AB 516 Page 4 elimination of 2.5 positions associated with keying data from ROS forms, and additional savings realized from the elimination of forms printing, shipping, and handling costs. COMMENTS: At the time of retail sale, the vehicle dealer is responsible for applying to DMV for the registration of a new vehicle and the transfer of registration for a used vehicle. Before the dealer can deliver the vehicle to the buyer, the dealer must affix to the vehicle's windshield a DMV-created report-of-sale notice showing that the vehicle is in the process of being registered. The dealer then has 20 days for a new vehicle or 30 days for a used vehicle to deliver to DMV the application and fees necessary to register the vehicle in the buyer's name. Prior to 2001, once DMV received and processed the application, DMV issued and mailed to the new owner two license plates, a vehicle registration card, and the appropriate registration stickers for the vehicle's rear license plate. The two license plates must remain affixed to a vehicle, but the vehicle was allowed to be operated for 180 days after purchase while displaying a report-of-sale notice rather than license plates with registration stickers. In 2001, under SB 46 (Polanco), Chapter 127, DMV established the electronic vehicle registration (EVR) program where motor vehicle dealers may enter into contracts to act as DMV business partners for vehicle registration and titling purposes. A business partner either directly, or through a service provider, communicates electronically with DMV to register a vehicle it has sold and then mails license plates, registration cards, and registration stickers to the buyer. Up until 2011, DMV estimated that less than half of new car dealers participated in the voluntary EVR program. AB 516 Page 5 AB 1215 (Blumenfield), Chapter 329, Statutes of 2011, implemented significant changes to the vehicle registration process including, requiring new car dealers to participate in the EVR program, reducing the period a vehicle may operate a vehicle with a report-of-sale notice to 90 days, and requiring license plates to be attached upon receipt by the vehicle owner. The successful implementation of AB 1215 has resulted in industry stakeholders indicating that vehicle owners are now receiving permanent license plates between 14 to 30 days on average. Furthermore, in those instances where vehicle registration delays have occurred, industry stakeholders indicate the delays typically relate to titling/financing issues rather than dealer errors. This bill directs DMV to develop an electronic vehicle report of sale system that will allow dealers to electronically transmit vehicle report of sale information and also issue TLPs as a means to ensure purchased or leased vehicles are identifiable to law enforcement and toll operators during the period between the point of sale and when permanent license plates are received by the purchaser. Specifically, this bill requires DMV to develop an electronic report of sale system, requires dealers to attach TLPs on a purchased vehicle at the point-of-sale, and requires a vehicle owner to remove TLPs and affix permanent license plates on their vehicle upon receipt. Please see the policy committee analysis for a full discussion of this bill. Analysis Prepared by: Manny Leon / TRANS. / (916) 319-2093 FN: 0000771 AB 516 Page 6