BILL ANALYSIS �
Senate Appropriations Committee Fiscal Summary
Senator Christine Kehoe, Chair
(Blumenfield) - Vehicles: conditional sale contracts.
Amended: August 24, 2012 Policy Vote: Judiciary 4-0
Urgency: Yes Mandate: Yes
Hearing Date: August 29, 2012
Consultant: Jolie Onodera
This bill does not meet the criteria for referral to the
Suspense File.
Bill Summary: AB 2502, an urgency measure, would revise the
automobile conditional sales contract law, effective July 1,
2013, to allow electric vehicle charging stations to be sold
with, and financed as part of, an automobile purchase. This bill
would require a seller, before executing a conditional sale
contract that includes a charge for an electric vehicle charging
station, to provide the buyer with, and obtain the buyer's
signature on, a written disclosure, as specified. This bill
would extend the sunset date on existing disclosure requirements
for one year, and effective July 1, 2013, would make the revised
disclosure requirements for conditional sale contracts operative
indefinitely.
Fiscal Impact:
Ongoing court costs for increased misdemeanor filings
potentially in the range of $24,000 to $48,000 (General
Fund) for 50 to 100 additional filings per year.
Minor, absorbable costs to the Department of Motor Vehicles
(DMV) for potential enforcement-related activities.
While the impact of this bill independently on local jails
is likely minor, the cumulative effect of increasing the
number of misdemeanors filed could create General Fund cost
pressure on capital outlay, staffing, programming, the
courts, and other resources in the context of recently
enacted 2011 Public Safety Realignment.
Background: Existing law, the Rees-Levering Motor Vehicle Sales
and Finance Act, sets forth numerous disclosure requirements to
be included in an automobile conditional sale contract,
including disclosures regarding finance charges, and sets forth
the permissible fees and charges in an automobile conditional
sale contract for the sale of a motor vehicle. A violation of
AB 2502 (Blumenfield)
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the disclosure requirements for conditional sale contracts is a
misdemeanor. Under existing law, the disclosure requirements are
operative until July 1, 2012, and as of January 1, 2013, are
repealed, unless a later enacted statute deletes or extends the
dates on which they become inoperative and are repealed.
Proposed Law: This bill, an urgency measure, extends the
existing disclosure requirements on conditional sale contracts
from July 1, 2012, to July 1, 2013, and effective July 1, 2013,
and thereafter:
Revises the automobile conditional sales contract law to
allow electric vehicle charging stations to be sold with,
and financed as part, of an automobile purchase, with a
required disclosure regarding charges.
Requires the disclosure and labeling, as specified, of
the total amount charged by the seller for an electric
vehicle charging station, which may include only the
charges for the station device, any materials and wiring,
and any installation services.
Requires a seller before executing a conditional sale
contract that includes a charge for an electric vehicle
charging station, to provide the buyer with, and obtain the
buyer's signature on, a written disclosure, in a specified
manner, that includes a description and price of the
electric vehicle charging station, any materials and
wiring, and equipment installation services included in the
total charge.
Extends indefinitely all other existing disclosure
requirements for conditional sale contracts.
This bill provides that in order to provide sellers of motor
vehicles notice of the additional disclosure requirements at the
earliest moment possible, it is necessary for this measure to
take effect immediately.
Staff Comments: Except in cases where a different punishment is
prescribed, a misdemeanor offense is punishable by imprisonment
in the county jail not exceeding six months, by a fine not
exceeding $1,000, or by both. The provisions of this bill will
result in an increased number of misdemeanor court filings that
otherwise would not have occurred under existing law in the
absence of the sunset extension and subsequent removal of the
sunset date on disclosure requirements for conditional sale
contracts. It is unknown how many additional filings will result
AB 2502 (Blumenfield)
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due to the provisions of this bill, however, it is estimated the
Judicial Council would incur costs for increased misdemeanor
filings of approximately $24,000 to $48,000 (General Fund)
statewide for every 50 to 100 new misdemeanors filed annually,
offset to a degree by fine revenue.
The creation of new, or the extension of existing, misdemeanors
has historically been analyzed by this Committee to result in
non-reimbursable state-mandated costs for local law enforcement
and incarceration. Staff notes, however, that the potential for
an increased number of misdemeanor convictions taken
cumulatively could increase the statewide adult jail population
to a degree that could potentially impact the flexibility of
counties to manage their jail populations recently increased
under the 2011 Public Safety Realignment. While the provisions
of this bill are likely to be minor, the cumulative effect of
all additional misdemeanors could create unknown General Fund
cost pressure on capital outlay, staffing, programming, the
courts, and other resources.
The DMV has indicated any costs resulting from increased
investigative workload in response to potential consumer
complaints related to dealer noncompliance are estimated to be
minor and absorbable within existing resources.
To the extent the provisions of this bill facilitate the sale of
electric vehicles by allowing electric vehicle charging stations
to be sold with, and financed as part of, an automobile
purchase, a positive impact on sales tax revenue could result.
However, the impact would be dependent on various factors
reliant on consumer behavior. If the majority of consumers would
have otherwise purchased electric vehicles and/or charging
stations apart from the financing transaction regardless of the
provisions of this bill, the future impact on tax revenues would
not be significant.