BILL ANALYSIS                                                                                                                                                                                                    



                                                                       AB 516


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          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          |                     |
          |                |      |                     |                     |
          |                |      |                     |                     |
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                                                                       AB 516


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          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


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          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  








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          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.  










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          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


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