BILL ANALYSIS Ó ----------------------------------------------------------------- |SENATE RULES COMMITTEE | AB 516| |Office of Senate Floor Analyses | | |(916) 651-1520 Fax: (916) | | |327-4478 | | ----------------------------------------------------------------- THIRD READING Bill No: AB 516 Author: Mullin (D), et al. Amended: 7/16/15 in Senate Vote: 21 SENATE TRANS. & HOUSING COMMITTEE: 10-0, 7/7/15 AYES: Beall, Cannella, Allen, Bates, Galgiani, Leyva, McGuire, Mendoza, Roth, Wieckowski NO VOTE RECORDED: Gaines SENATE PUBLIC SAFETY COMMITTEE: 5-2, 7/14/15 AYES: Hancock, Glazer, Leno, Liu, Monning NOES: Anderson, Stone SENATE APPROPRIATIONS COMMITTEE: 6-1, 8/27/15 AYES: Lara, Bates, Beall, Hill, Leyva, Mendoza NOES: Nielsen ASSEMBLY FLOOR: 74-1, 6/4/15 - See last page for vote SUBJECT: Vehicles: temporary license plates SOURCE: California Association of Highway Patrolmen DIGEST: This bill requires the Department of Motor Vehicles (DMV) to create a process to issue temporary license plates (TLPs) by January 1, 2018, and requires dealers to attach TLPs to all unplated vehicles when they are sold beginning January 1, 2018. ANALYSIS: AB 516 Page 2 Existing law: 1)Requires dealers, when selling a vehicle, to use the report-of-sale (ROS) forms issued by the DMV, to give written notice of the sale to the DMV not later than the fifth calendar day after the sale, and to display a copy of the ROS on the vehicle. 2)Permits vehicles displaying a copy of the ROS to be operated until the license plates are received by the purchaser or for 90 days, whichever occurs first. The penalty for failing to display the plate is a fix-it ticket. 3)Authorizes dealers to charge document preparation fees of $80 for new cars and $65 for used cars. 4)Makes the altering, forging, etcetera of various DMV documents a jail wobbler. This bill: 1)Requires the DMV, by January 1, 2018, to develop a system for electronically reporting vehicle sales before the vehicle is delivered to the purchaser and for issuing TLPs. 2)Requires dealers, by January 1, 2018, to affix the TLP to the automobile at the time of sale. 3)Requires the DMV to recover the cost of developing the TLP system by increasing existing fees for the recording of notices of delinquent parking violations and delinquent toll evasions beginning January 1, 2017. 4)Authorizes dealers, beginning January 1, 2018, to raise their document processing fees by $10, from $80 to $90 for new cars and from $65 to $75 for used cars. 5)Makes the altering, forging, etcetera of a TLP a jail wobbler. Comments Purpose. The author is concerned that existing law allows thousands of vehicles to drive on our roads with no license plate, creating a public safety hazard and reducing toll revenue AB 516 Page 3 by $15 million per year as a result of vehicles without plates using toll roads and bridges without payment. Electronic toll payment collection systems rely upon a photo of the vehicle's license plate for enforcement. Without a plate, vehicles are able to use toll lanes and toll bridges without much fear of getting caught. Because cars are often sold without plates, and it is legal to operate without plates for 90 days, transportation agencies are concerned about revenue losses. The Metropolitan Transportation Commission estimates that it loses $9 million annually in unpaid tolls, with statewide losses of $15 million. Other supporters emphasize that having licenses on all vehicles will improve public safety, allowing law enforcement to more quickly and safely identify vehicles. They note that 35 states have TLP programs. Winners and losers. The major beneficiaries of this bill are tolling agencies, which will recoup tens of millions of dollars in lost revenue. The major losers are the toll evaders, who will now have to pay like everyone else. But this bill also creates costs for all car buyers, who will pay an additional $10 to cover the costs incurred by car dealers to implement the TLP system. If the goal is to stop cheating on toll roads and toll bridges, an alternative, simpler, more quickly implemented solution would be to increase patrols of these facilities. Electronic reporting of sales. The provision in this bill requiring the development of an electronic ROS process by January 1, 2018, was suggested by the DMV. The ROS process would also result in the creation of a TLP, adding efficiencies for vehicle dealers, other retailers, and the DMV by eliminating the existing paper process. Given the state's uneven record with technology procurement, the progress of this project will need to be followed closely. Opposition. Opponents oppose the increase in dealer fees. Also, while this bill contains safeguards to ensure that car purchasers aren't cited if they don't display their permanent plates within 90 days because they haven't received them, opponents are concerned that those safeguards are inadequate. FISCAL EFFECT: Appropriation: No Fiscal AB 516 Page 4 Com.:YesLocal: Yes According to the Senate Appropriations Committee: One-time DMV costs of approximately $2.4 million in 2016-17 to develop and implement an automated vehicle ROS process, and ongoing costs of approximately $700,000 annually thereafter, offset by administrative savings of $920,000 annually, beginning January 1, 2018. As a result, DMV would have net costs of $260,000 in 2017-18, and net savings of $220,000 annually thereafter. (Motor Vehicle Account) Unknown fee revenue gains to DMV beginning January 1, 2017, related to the authorization to adjust the fees for recording notices of parking and toll evasion violations. DMV expects to adjust the fees in an amount sufficient to offset costs to develop the ROS system. (Motor Vehicle Account) Unknown, potentially significant local toll revenue gains related to reduced toll evasion as a result of the requirement for dealers to affix a TLP at the time of a vehicle transaction. (local funds) SUPPORT: (Verified9/9/15) California Association of Highway Patrolmen (source) California Lien Agents Association California Police Chief Association, Inc. California State Lodge, Fraternal Order of Police California State Sheriffs' Association City/County Association of Governments of San Mateo County Golden Gate Bridge Highway and Transportation District Long Beach Police Officers Association Los Angeles County Professional Peace Officers Association Los Angeles County Sheriff's Department Metropolitan Transportation Commission Sacramento County Deputy Sheriffs' Association San Diego Association of Governments San Francisco County Transportation Authority Santa Clara Valley Transportation Authority Solano Transportation Authority Transportation Authority of Marin AB 516 Page 5 Transportation Corridor Agencies OPPOSITION: (Verified9/9/15) California Rural Legal Assistance Foundation Car Dealers Saving Lives Consumer Federation of California Consumers for Auto Reliability and Safety Kemnitzer, Barron & Krieg, LLP Lawyers' Committee for Civil Rights of the San Francisco Bay Area ASSEMBLY FLOOR: 74-1, 6/4/15 AYES: Achadjian, Alejo, Baker, Bigelow, Bloom, Bonilla, Bonta, Brown, Burke, Calderon, Campos, Chang, Chau, Chávez, Chiu, Chu, Cooley, Cooper, Dababneh, Daly, Dodd, Eggman, Frazier, Beth Gaines, Gallagher, Cristina Garcia, Eduardo Garcia, Gatto, Gipson, Gomez, Gonzalez, Gordon, Gray, Grove, Hadley, Roger Hernández, Holden, Irwin, Jones-Sawyer, Kim, Lackey, Linder, Lopez, Low, Maienschein, Mathis, Mayes, McCarty, Medina, Melendez, Mullin, Nazarian, Obernolte, O'Donnell, Olsen, Patterson, Perea, Quirk, Rendon, Ridley-Thomas, Rodriguez, Salas, Santiago, Steinorth, Mark Stone, Thurmond, Ting, Wagner, Waldron, Weber, Wilk, Williams, Wood, Atkins NOES: Levine NO VOTE RECORDED: Travis Allen, Brough, Dahle, Harper, Jones Prepared by:Randy Chinn / T. & H. / (916) 651-4121 9/9/15 10:35:02 **** END ****