BILL ANALYSIS Ó
AB 516
Page 1
(Without Reference to File)
CONCURRENCE IN SENATE AMENDMENTS
AB
516 (Mullin)
As Amended June 23, 2016
Majority vote
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|ASSEMBLY: |74-1 |(June 4, 2015) |SENATE: |30-6 | (June 30, 2016) |
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Original Committee Reference: TRANS.
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).
The Senate amendments:
1)Increase the document preparation fee a motor vehicle dealer
may charge a customer by $5, as specified.
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2)Allow a vehicle to continue to operate with a report-of-sale
form or TLP after 90 days if the owner has not received
permanent license plates and can provide sufficient proof that
they have submitted the appropriate documentation to DMV, as
specified.
3)Clarify the existing electronic filing charge is not to exceed
the cost associated with administering the report of sale
system and producing TLP's, as specified.
4)Require DMV to develop standards for TLPs, as specified.
5)Delay the bill's implementation date until January 1, 2019.
AS PASSED BY THE ASSEMBLY, this bill:
1)Required 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)Permitted 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)Required DMV to develop a system for dealers and
lessor-retailers to electronically report the sale of a
vehicle, as specified.
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2)Provided 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)Required 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.
4)Required 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)Required the electronic report of sale system to be developed
and made available to dealers by no later than January 1,
2018.
6)Specified that it is a felony for a person to alter, forge,
counterfeit, or falsify a TLP.
7)Authorized 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)Required TLPs to be affixed to the vehicle and requires the
owner to remove TLPs upon receipt of permanent plates.
9)Made additional technical and conforming changes in order to
implement and enforce DMV's electronic report of sale system.
FISCAL EFFECT: According to the Senate Appropriations
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Committee:
1)One-time DMV costs of approximately $2.4 million in 2016-17 to
develop and implement an automated vehicle report-of-sale
(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)
2)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)
3)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)
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
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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 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 days 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
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vehicle owner to remove TLPs and affix permanent license plates
on their vehicle upon receipt.
Analysis Prepared by:
Justin Behrens / TRANS. / (916) 319-2093 FN:
0003544