BILL ANALYSIS Ó
AB 2107
Page 1
ASSEMBLY THIRD READING
AB
2107 (Frazier)
As Introduced February 17, 2016
Majority vote
------------------------------------------------------------------
|Committee |Votes|Ayes |Noes |
| | | | |
| | | | |
| | | | |
|----------------+-----+----------------------+--------------------|
|Transportation |16-0 |Frazier, Linder, | |
| | |Baker, Bloom, Brown, | |
| | |Chu, Daly, Dodd, | |
| | |Eduardo Garcia, | |
| | |Gomez, Kim, Mathis, | |
| | |Medina, Melendez, | |
| | |Nazarian, O'Donnell | |
| | | | |
|----------------+-----+----------------------+--------------------|
|Appropriations |20-0 |Gonzalez, Bigelow, | |
| | |Bloom, Bonilla, | |
| | |Bonta, Calderon, | |
| | |Chang, Daly, Eggman, | |
| | |Gallagher, Eduardo | |
| | |Garcia, Roger | |
| | |Hernández, Holden, | |
| | |Jones, Obernolte, | |
| | |Quirk, Santiago, | |
| | |Wagner, Weber, Wood | |
| | | | |
AB 2107
Page 2
| | | | |
------------------------------------------------------------------
SUMMARY: Authorizes the Department of Motor Vehicles (DMV) to
enter into agreements with qualified private industry partners
to carry out certain electronic registration transactions
related to the International Registration Plan (IRP).
Specifically, this bill:
1)Authorizes DMV to enter into contracts with three types of
interstate carrier partners subject to certain requirements
for the purpose of providing electronic vehicle registration
service using an apportioned registration system.
2)Authorizes DMV to adopt regulations to carry out the purposes
of this program and to establish through regulation the
maximum amount that an interstate carrier partner may charge
its customers in providing the services under this program.
EXISTING LAW:
1)Authorizes DMV to enter in to the IRP and adopt rules and
regulations necessary to carry out the provisions of the IRP.
2)Authorizes DMV to establish contracts for electronic programs
that allow qualified private industry partners to provide
services that include processing and payment programs for
vehicle registration and titling transactions.
3)Requires a new motor vehicle dealer to use electronic programs
provided by a specific type of private industry partner to
register a vehicle the dealer sells or leases if DMV permits
AB 2107
Page 3
the transaction to be processed electronically, except for
off-highway or recreational vehicles.
FISCAL EFFECT: According to the Assembly Appropriations
Committee, DMV will incur additional costs of around $400,000 in
the first year and $250,000 ongoing to develop regulations,
execute contracts, develop security protocols, revise forms and
manuals, and process applications. Though some of these costs
will be borne by the department initially, all costs should be
recovered through fees to be established by the department
through regulations.
COMMENTS: Existing law, [SB 46 (Polanco), Chapter 127, Statutes
of 2001], establishes DMV's Business Partner Automation (BPA)
program and authorizes the department to enter into contracts
that allow private industry partners to process specific
vehicle-related transactions, such as vehicle registration and
titling. Under this program, a business partner communicates
with DMV either directly or through a service provider to
complete the transaction. In 2011, AB 1215 (Blumenfield),
Chapter 329, Statutes of 2011, required licensed new motor
vehicle dealers to participate in the BPA program and
electronically process all vehicle sales and leases. Since that
time, the BPA program has grown to become the primary processing
method for these transactions, and more than $1.2 billion in
annual vehicle-related state revenue is received by the state
through the BPA program.
The IRP is a federally-supported program that facilitates
interstate trucking operations across the United States and the
Canadian provinces. Member jurisdictions of the IRP collect
vehicle registration fees from their home-based interstate
trucking companies on behalf of each member jurisdiction in
which the companies operate. Fees collected under the IRP are
then apportioned to each member jurisdiction, based on the
proportion of the carrier's operations in that jurisdiction. In
AB 2107
Page 4
order to participate in this apportioned registration program,
motor carriers must register and obtain IRP credentials from
their home jurisdiction.
In 2011, DMV initiated a pilot program resembling the BPA
program to allow certain registration services to perform a
limited set of transactions related to the IRP on an electronic
platform. Under the pilot, authorized vendors can issue IRP
credentials and documents to motor carriers and record
transactions on DMV systems that are then reviewed by the
department for accuracy and completeness. The alternative,
non-electronic method to complete these transactions requires
motor carriers to submit physical documents to DMV headquarters
for approval, which can be a lengthy, time-consuming process.
This pilot program has allowed the trucking industry to obtain
local service in a timely manner without negatively impacting
processing times in DMV field offices. In the span of five
years, over 75,000 IRP transactions will have been processed by
59 program participants.
This bill would make DMV's pilot program permanent and authorize
DMV to adopt regulations to carry out the program.
Specifically, this bill establishes basic qualifications for
industry partners and identifies three types of entities DMV may
partner with: a registration service, who handles vehicle
registration as part of a bookkeeping operation for
owner-operators and small firms; a vehicle leasing company or
vehicle rental company, who provide trucks and equipment; and a
motor carrier association, which could assist their memberships
with IRP credentialing. DMV would also be authorized to adopt
regulations relating to program administration structure, fees,
financial responsibility, compliance requirements, adequate
oversight and monitoring, safeguards for privacy, minimum
transaction requirements, performance standards to ensure
accuracy and efficiency, and to set the maximum amount that an
industry partner could charge for these services.
AB 2107
Page 5
According to the author, this bill will ensure that the trucking
industry has immediate and convenient access to IRP
credentialing, expediting the entry of commercial motor vehicles
into interstate trucking activities. The success of the BPA
program demonstrates the value of public-private partnerships in
accomplishing regulatory compliance with California's motor
vehicle-related standards. The author argues that this bill
would improve the movement of goods in California, home to three
of the nation's busiest ports and a primary arrival and
destination point for international trade, by quickly
authorizing vehicles to operate in interstate commerce through
an efficient and cost-effective technological solution.
Please see the policy committee analysis for full discussion of
this bill.
Analysis Prepared by:
Justin Behrens / TRANS. / (916) 319-2093 FN:
0003131