BILL ANALYSIS Ó
SENATE COMMITTEE ON APPROPRIATIONS
Senator Ricardo Lara, Chair
2015 - 2016 Regular Session
AB 1858 (Santiago) - Automobile dismantling: task force
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|Version: August 1, 2016 |Policy Vote: T. & H. 10 - 0 |
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|Urgency: No |Mandate: No |
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|Hearing Date: August 1, 2016 |Consultant: Mark McKenzie |
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This bill meets the criteria for referral to the Suspense File.
Bill
Summary: AB 1858 would require the Department of Motor Vehicles
(DMV) to collaborate with specified state entities until January
1, 2020 to review and coordinate enforcement and compliance
activity related to unlicensed, unregulated, and underground
automobile dismantling activities. The bill would require a
report to the Legislature on those activities and any
recommendations by January 1, 2019.
Fiscal
Impact:
DMV costs of $390,000 in 2017-18 and 2018-19, and $195,000 in
2019-20, and 3 PY of investigator staff to prepare and execute
cases and collaborate with other specified departments.
(Motor Vehicle Account).
Additional one-time DMV costs of approximately $85,000 for
investigator staff training and equipment and to establish an
advertised telephone hotline for soliciting referrals from the
AB 1858 (Santiago) Page 1 of
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public on unlicensed activity. There could be additional
ongoing costs related to the hotline, depending on call
volumes. (Motor Vehicle Account)
Potential staffing costs for the Board of Equalization (BOE),
the California Environmental Protection Agency (CalEPA), the
Department of Toxic Substances Control (DTSC), the State Water
Resources Control Board (SWRCB), the Department of Resources
Recycling and Recovery (CalRecycle), and the California Air
Resources Board (CARB) to provide enforcement and resources
for the investigation and reporting of illegal auto
dismantling activities. Depending on current enforcement
levels, this bill could impose costs ranging from absorbable
up to $150,000 annually per affected state entity until 2020.
For instance, BOE, CalEPA, and SWRCB all indicate absorbable
costs, while CARB estimates the need for an additional PY of
staff at a cost of $154,000.
Background: An automobile dismantler must hold a valid license from DMV in
order to legally conduct business. An applicant must provide
DMV with information relating to his or her "character, honesty,
integrity, and reputation, as the department may consider
necessary," in addition to certain identification numbers
related to the BOE, CalEPA, and Franchise Tax Board, as well as
indication of whether stormwater and other specified permits are
required and have been acquired.
Dismantlers process end-of-life vehicles by properly removing,
recycling, or disposing of unused gasoline, and other fluids and
chemicals, and ensuring that remaining metal and parts that
cannot be resold are properly recycled. The disposal and
recycling methods must be consistent with the requirements
imposed by the environmental permits a dismantler is required to
obtain prior to licensure with the DMV.
The auto dismantling industry has experienced a decline in
licensed activity over the past decade, part of which could be
attributable to an increase in unlicensed dismantling
activities. Unlicensed activities can have negative
environmental and public health impacts, and may include illegal
dumping and disposal of hazardous materials, regulatory fee and
tax avoidance, violations of vehicle export laws, and
trafficking in stolen property.
AB 1858 (Santiago) Page 2 of
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Proposed Law:
AB 1858 would require DMV to collaborate with BOE, CalEPA,
DTSC, SWRCB, CalRecycle, and CARB until January 1, 2020 to
review and coordinate enforcement and compliance activity
related to unlicensed, unregulated, and underground automobile
dismantling activities. Specifically, this bill would:
Require the collaborating state entities to provide
enforcement and necessary resources to DMV for the
investigation and reporting of unregulated activities.
Authorize DMV, with the partner entities, to collaborate and
solicit information from other federal, state, and local
enforcement agencies with jurisdiction over illegal automobile
dismantlers.
Require DMV, in consultation with the partner entities, to
establish a public outreach effort for soliciting referrals
from the public, including an advertised telephone hotline
lead, referral form, and other methods to identify and report
unlicensed activity.
Require DMV, on or before January 1, 2019 and in collaboration
with the partner entities, to submit a report to the
Legislature that includes the following:
o The number of unlicensed dismantlers investigated
and the number of investigations resulting in an
administrative or civil enforcement action, or criminal
prosecution.
o Any identified statutory or regulatory gaps for
investigating and prosecuting unlicensed dismantlers.
o Information on how vehicles are acquired by
unlicensed dismantlers, and the places and types of
facilities where unlicensed activities occur.
o A summary of the barriers to adequate and efficient
enforcement of environmental, tax, and licensing statutes
and regulations against unlicensed dismantlers.
o Proposed strategies for bringing unlicensed
dismantlers into compliance through assistance,
education, training, or other identified methods.
o Recommendations for modifying, eliminating, or
continuing the coordinated enforcement and compliance
activities specified in this bill.
o Recommendations for any statutory or regulatory
changes needed to enhance enforcement against unlicensed
dismantlers.
AB 1858 (Santiago) Page 3 of
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Sunset the provisions of the bill on January 1, 2020.
Staff
Comments: The author and sponsors estimate that as many as 30
percent of the end-of-life vehicles are being processed through
unlicensed and unregulated automobile dismantlers. These
transactions occur outside the existing legal and regulatory
framework for automobile dismantlers, meaning unlicensed
dismantlers are not necessarily complying with the environmental
and tax requirements imposed on licensed dismantlers. This bill
is intended to enhance compliance through multi-agency
collaboration of efforts to investigate, enforce, and report on
unlicensed activities.
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