BILL NUMBER: SB 1329 CHAPTERED 07/21/00 CHAPTER 163 FILED WITH SECRETARY OF STATE JULY 21, 2000 APPROVED BY GOVERNOR JULY 21, 2000 PASSED THE ASSEMBLY JULY 6, 2000 PASSED THE SENATE MAY 25, 2000 AMENDED IN SENATE MAY 10, 2000 AMENDED IN SENATE MARCH 6, 2000 AMENDED IN SENATE FEBRUARY 7, 2000 INTRODUCED BY Senator Karnette JANUARY 4, 2000 An act to amend Sections 4852, 5060, 5101, and 5103 of the Vehicle Code, relating to vehicles. LEGISLATIVE COUNSEL'S DIGEST SB 1329, Karnette. License plates. (1) Existing law specifies the dimension for license plates issued for motor vehicles, other than motorcycles. This bill would additionally specify the size of the number and letter characters and the minimum spacing between characters. The bill would specify the dimension of a motorcycle license plate, character size, and the minimum spacing between characters. (2) Existing law requires the Department of Motor Vehicles to issue special interest license plates containing a distinctive design or decal of a participating organization, to any person, to be displayed in lieu of regular license plates. Existing law requires each organization that applies to the department for participation in the program to collect and hold applications for the plates until it has received at least 5,000 applications, and to submit the applications along with the necessary fees, to the department within one calendar year following the enactment of the specific enabling legislation. Existing law requires an organization to return to all applicants any fees or deposits that have been collected if 5,000 applications have not been received within one calendar year. As an alternative to returning the applicant's application and fees or deposits following the one-calendar-year period, an organization may contact the department to indicate its intent to undertake collection of additional applications and fees or deposits for an additional period, not to exceed 12 months, in order to obtain the minimum 5,000 applications. Existing law prohibits an eligible, participating organization from expending more than 25% of the funds generated by revenues from the sale of these plates on certain marketing and promotional activities. This bill would substantially recast these provisions. The bill would authorize an organization to apply to the department to establish a special interest license plate program and the department would be required to authorize that participation if the issuance of those plates is required by statute and the organization is tax exempt, submits a financial plan describing the purpose for which certain revenues generated from the sale of the plates will be used, and submits an essential design of the proposed special interest license plate that, among other things, provides for the placement of the number and letter characters in a manner that allows for law enforcement to readily identify those characters. The bill would also set forth certain design criteria for the special interest license plates for a passenger vehicle, commercial vehicle, or trailer, including allowing the plates to contain a descriptive message, as an alternative to the design or decal. The bill would set separate design criteria for special interest license plates for motorcycles and would make conforming changes to this authorization. The bill would increase the number of applicants needed for an organization to participate in the program from not less than 5,000 to not less than 7,500 applicants. The bill would require the department, if the number of currently outstanding and valid special interest license plates in a particular program is less than 7,500, to notify the sponsoring organization of that fact and to inform the organization that if that number is less than 7,500 one year from the date of that notification, the department will no longer issue or replace those special interest license plates. The bill would allow those particular special interest license plates that were issued prior to the discontinuation to continue to be used and attached to the vehicle for which they were issued and to be renewed, retained, or transferred pursuant to the Vehicle Code. The bill would require the department to deposit remaining revenues generated from the issuance, renewal, extension, replacement, or transfer of special interest license plates in a fund required to be established by the Controller. The bill would limit participating organizations from annually expending 25% of the funds that the organization receives from the additional fees on administrative costs as well as marketing and promotional costs. Because under existing law a violation of this restriction is a crime, this bill would create a state-mandated local program by expanding the scope of that crime. The bill would also require every organization authorized to offer special interest license plates to prepare and submit an annual accounting report to the department by June 30. The bill would, if the organization violates the 25% expenditure restriction, require the department to cease depositing fees in the fund established by the Controller, as described above, and, instead would require those fees to be deposited in a second fund created by the Controller which would be subject to appropriation by the Legislature. The bill would require the department to immediately notify the organization of this course of action. The bill would prohibit the department from issuing or replacing the special interest license plates associated with that organization, if, one year after the date the organization receives the notice, the organization is still unable to satisfactorily demonstrate to the department that it is in compliance or will comply with the 25% expenditure restriction. The bill would allow those particular special interest license plates that were issued prior to the discontinuation to continue to be used and attached to the vehicle for which they were issued and to be renewed, retained, or transferred pursuant to the Vehicle Code. The bill would require the department to transmit an annual consolidated accounting report to the Legislature. (3) The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement. This bill would provide that no reimbursement is required by this act for a specified reason. THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS: SECTION 1. Section 4852 of the Vehicle Code is amended to read: 4852. (a) License plates issued for motor vehicles, other than motorcycles, shall be rectangular in shape, 12 inches in length and six inches in width. The number and letter characters shall have a minimum height of two and three-quarter inches, a minimum width of one and one-quarter inches, and a minimum spacing between characters of five-sixteenths of an inch. (b) Motorcycle license plates shall measure seven inches in length and four inches in width, characters shall have a minimum height of one and one-half inches and a minimum width of nine-sixteenths inches, and have a minimum spacing between characters of three-sixteenths of an inch. SEC. 2. Section 5060 of the Vehicle Code is amended to read: 5060. (a) An organization may apply to the department for participation in a special interest license plate program and the department shall issue special license plates for that program if the issuance of those plates is required by this article, the sponsoring organization complies with the requirements of this section, and the organization meets all of the following criteria: (1) Qualifies for tax-exempt status under Section 501(c)(3) of the Internal Revenue Code and subdivision (d) of Section 23701 of the Revenue and Taxation Code. (2) Submits a financial plan describing the purposes for which the revenues described in paragraph (2) of subdivision (e) will be used. (3) Submits a design of the organization's proposed special interest license plate that, among other things, provides for the placement of the number and letter characters in a manner that allows for law enforcement to readily identify those characters. (b) Any person described in Section 5101 may apply for special interest license plates, in lieu of the regular license plates. (c) The design criteria for a special interest license plate are as follows: (1) The license plate for a passenger vehicle, commercial vehicle, or trailer shall provide a space not larger than two inches by three inches to the left of the numerical series and a space not larger than five-eighths of an inch in height below the numerical series for a distinctive design, decal, or descriptive message as authorized by this article. The plates shall be issued in sequential numerical order or, pursuant to Section 5103, in a combination of numbers or letters. (2) Special interest license plates authorized under this article may be issued for use on a motorcycle. That license plate shall contain a five digit configuration issued in sequential numerical order or, pursuant to Section 5103, in a combination of numbers or letters. There shall be a space to the left of the numerical series for a distinctive design or decal and the characters shall contrast sharply with the uniform background color. No motorcycle plate containing a full plate graphic design is authorized. Those particular special interest license plates that were issued prior to the discontinuation provided by this paragraph may continue to be used and attached to the vehicle for which they were issued and may be renewed, retained, or transferred pursuant to this code. (d) (1) No organization may be included in the program until not less than 7,500 applications for the particular special interest license plates are received. Each organization shall collect and hold applications for the plates. Once the organization has received at least 7,500 applications, it shall submit the applications, along with the necessary fees, to the department. The department shall not issue any special interest license plate until an organization has received and submitted to the department not less than 7,500 applications for that particular special interest license plate within the time period prescribed in this section. Advanced payment to the department by an organization representing the department's estimated or actual administrative costs associated with the issuance of a particular special interest license plate shall not constitute compliance with this requirement. The organization shall have 12 months, following the effective date of the enactment of the specific legislation enabling the organization to participate in this program, to receive the required number of applications. If, after that 12 months, 7,500 applications have not been received, the organization shall immediately do either of the following: (A) Refund to all applicants any fees or deposits that have been collected. (B) Contact the department to indicate the organization's intent to undertake collection of additional applications and fees or deposits for an additional period, not to exceed 12 months, in order to obtain the minimum 7,500 applications. If an organization elects to exercise the option under this paragraph, it shall contact each applicant who has submitted an application with the appropriate fees or deposits to determine if the applicant wishes a refund of fees or deposits or requests the continuance of the holding of the application and fees or deposits until that time that the organization has received 7,500 applications. The organization shall refund the fees or deposits to any applicant so requesting. In no event shall an organization collect and hold applications for a period exceeding 24 months following the date of authorization as described in paragraph (2) of subdivision (a). (C) Sequential plate fees shall be paid for the original issuance, renewal, retention, replacement, or transfer of the special interest license plate as determined by the organization and authorized by department's regulations. Those plates containing a personalized message are subject to the fees required pursuant to Sections 5106 and 5108 in addition to any fees required by the special interest license plate program. (2) (A) If the number of currently outstanding and valid special interest license plates in any particular program provided for in this article is less than 7,500, the department shall notify the sponsoring organization of that fact and shall inform the organization that if that number is less than 7,500 one year from the date of that notification, the department will no longer issue or replace those special interest license plates. (B) Those particular special interest license plates that were issued prior to the discontinuation provided by subparagraph (A) may continue to be used and attached to the vehicle for which they were issued and may be renewed, retained, or transferred pursuant to this code. (e) (1) The department shall deduct its costs to develop and administer the special interest license plate program from the revenues collected for the plates. (2) The department shall deposit the remaining revenues from the original issuance, renewal, retention, replacement, or transfer of the special interest license plate in a fund which shall be established by the Controller. (f) When payment of renewal fees is not required as specified in Section 4000, or when a person determines to retain the special interest license plate upon a sale, trade, or other release of the vehicle upon which the plate has been displayed, the person shall notify the department and the person may retain and use the plate as authorized by department regulations. (g) An organization that is eligible to participate in a special interest license plate program pursuant to this article and receives funds from the additional fees collected from the sale of special license plates shall not expend annually more than 25 percent of those funds on administrative costs, marketing, or other promotional activities associated with encouraging application for, or renewal of, the special license plates. (h) (1) Every organization authorized under this article to offer special interest license plates shall prepare and submit an annual accounting report to the department by June 30. The report shall include an accounting of all revenues and expenditures associated with the special interest license plate program. (2) If an organization submits a report pursuant to paragraph (1) indicating that the organization violated the expenditure restriction set forth in subdivision (g), the department shall immediately cease depositing fees in the fund created by the Controller for that organization under paragraph (2) of subdivision (e) and, instead, shall deposit those fees that would have otherwise been deposited in that fund in a separate fund created by the Controller, which fund is subject to appropriation by the Legislature. The department shall immediately notify the organization of this course of action. The depositing of funds in the account established pursuant to this paragraph shall continue until the organization demonstrates to the satisfaction of the department that the organization is in compliance or will comply with the requirements of subdivision (g). If one year from the date that the organization receives the notice described in this paragraph, the organization is still unable to satisfactorily demonstrate to the department that it is in compliance or will comply with the requirements of subdivision (g), the department shall no longer issue or replace those special interest license plates associated with that organization. Those particular special interest license plates that were issued prior to the discontinuation provided by this paragraph may continue to be used and attached to the vehicle for which they were issued and may be renewed, retained, or transferred pursuant to this code. (3) Upon receiving the reports required under paragraph (1), the department shall prepare and transmit an annual consolidated report to the Legislature containing the revenue and expenditure data. SEC. 3. Section 5101 of the Vehicle Code is amended to read: 5101. Any person who is the registered owner or lessee of a passenger vehicle, commercial vehicle, motorcycle, or trailer registered with the department, or who makes application for an original registration or renewal registration of any vehicle, may, upon payment of the fee prescribed in Section 5106, apply to the department for environmental license plates, in the manner prescribed in Section 5105, which plates shall be affixed to the passenger vehicle, commercial vehicle, motorcycle, or trailer for which registration is sought in lieu of the regular license plates. SEC. 4. Section 5103 of the Vehicle Code is amended to read: 5103. "Environmental license plates," as used in this article, means license plates that have displayed upon them the registration number assigned to the passenger vehicle, commercial vehicle, motorcycle, or trailer for which a registration number was issued in a combination of letters or numbers, or both, requested by the owner or lessee of the vehicle. SEC. 5. No reimbursement is required by this act pursuant to Section 6 of Article XIIIB of the California Constitution because the only costs that may be incurred by a local agency or school district will be incurred because this act creates a new crime or infraction, eliminates a crime or infraction, or changes the penalty for a crime or infraction, within the meaning of Section 17556 of the Government Code, or changes the definition of a crime within the meaning of Section 6 of Article XIIIB of the California Constitution.