Assembly Bill No. 1215
Passed the Assembly September 2, 2011
Chief Clerk of the Assembly
Passed the Senate August 30, 2011
Secretary of the Senate
Private Secretary of the Governor
CHAPTER
An act to amend, repeal, and add Sections 2982 and 2985.8 of
the Civil Code, and to amend, repeal, and add Sections 4456, 5202,
11713.1, and 11713.21 of, and to add Sections 4456.4, 4456.5,
and 11713.26 to, the Vehicle Code, relating to vehicles.
legislative counsel’s digest
AB 1215, Blumenfield. Vehicles: electronic processing of
documents: titling and registration.
(1) Existing law imposes specified licensing and regulatory
requirements on dealers of motor vehicles and requires that
specified fees and charges be disclosed in a conditional sales
contract for the purchase of a motor vehicle. Existing law also
prohibits any person from driving, moving, or leaving upon a
highway any motor vehicle subject to registration under the Vehicle
Code, unless it is registered and the appropriate fees have been
paid under that code, and existing law authorizes the Department
of Motor Vehicles to establish contracts for electronic programs
that allow qualified industry partners to join the department in
providing services that include processing and payment programs
for vehicle registration and titling transactions.
Existing law makes it a violation of the Vehicle Code for the
holder of any vehicle dealer’s license to commit specified actions,
including, to advertise the total price of a vehicle without including
all costs to the purchaser at the time of sale, except taxes, vehicle
registration fees, the California tire fee, as defined, emission testing
fees not exceeding $50, actual fees charged for certificates, finance
charges, and any dealer document preparation charge, and prohibits
the dealer document preparation charge from exceeding $55.
This bill would, beginning July 1, 2012, revise and recast these
provisions and would require a motor vehicle sold or leased by a
new motor vehicle dealer to be registered by the dealer using
electronic programs provided by a qualified private industry
partner, would require the dealer to disclose any document
processing charge or electronic registration or transfer charge, and
would establish the charges that a dealer may charge the purchaser
or lessee of a vehicle.

The bill would, after October 1, 2012, make it a violation of the
Vehicle Code for the holder of a dealer’s license to sell or lease a
new motor vehicle unless the dealer has a contractual agreement
with the department to be a private industry partner, except as
specified. The bill would make other conforming changes to these
provisions.
The bill would, beginning July 1, 2012, prohibit a dealer from
displaying or offering for sale at retail a used vehicle unless the
dealer first obtains a vehicle history report from the National Motor
Vehicle Title Information System (NMVTIS). If the NMVTIS
report indicates that the vehicle is or has been a junk or salvage
automobile, or the vehicle has been reported as such by a junk or
a salvage yard, or an insurance carrier, or the certificate of title
contains a brand, the bill would require the dealer to post a
specified disclosure and provide the retail purchaser with a copy
of the report upon request prior to sale. These requirements
associated with obtaining a NMVTIS vehicle history report would
become inoperative if all NMVTIS data providers cease to make
these reports available to the public.
(2) Because this bill would create new crimes, the bill would
impose a state-mandated local program.
(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. The Legislature finds and declares all of the
following:

(a) There are more than 30 million vehicles registered in the
State of California. Maintenance by the Department of Motor
Vehicles of accurate registration records for those vehicles is of
vital importance to registered owners, legal owners that hold liens
on vehicles, law enforcement agencies that police vehicles, tax
collection agencies that collect taxes and fees assessed on vehicles,
and pollution control agencies that regulate emissions produced
by vehicles.

(b) As authorized by the Legislature in 2001, the department
administers the Business Partner Automation Program, pursuant
to Section 1685 of the Vehicle Code, to improve the quality of
registration products and services by licensing qualified private
industry partners to provide secure electronic portals to licensed
dealers and registration services so that they may perform required
registration tasks electronically.

(c) Electronic vehicle registration under the Business Partner
Automation Program results in multiple benefits. The department
benefits through increased accuracy of records that are recorded
and transmitted electronically and also benefits through processing
efficiencies that reduce wait times in field offices for nonelectronic
transactions. Electronic registration also aids law enforcement,
other government agencies, and consumers by accelerating the
issuance of permanent license plates from a period of weeks or
months to days.

(d) It is the intent of the Legislature in enacting this act to further
increase the registration benefits and efficiencies of the
department’s Business Partner Automation Program by requiring
all eligible vehicles sold or leased by a new motor vehicle dealer
to be registered electronically. It is also the intent of the Legislature
that the department continues to improve and expand the quality
and efficiency of the Business Partner Automation Program to
permit existing department personnel to increase customer service
in other areas without a workforce reduction.

SEC. 2. The Legislature finds and declares all of the following:

(a) The electronic National Motor Vehicle Title Information
System (NMVTIS) is a national federally mandated vehicle history
database maintained by the United States Department of Justice
to ensure that states, law enforcement agencies, and consumers
have access to vehicle titling, branding, and other information that
enable them to verify the accuracy and legality of motor vehicle
titles before transfer or registration of the vehicle occurs.

(b) According to a cost-benefit analysis commissioned by the
United States Department of Justice, full implementation of
NMVTIS will save the American public between $4.3 billion and
$11.7 billion by helping to curb automobile-related salvage fraud,
theft, and related crimes.

(c) All automobile insurers, self-insured entities, salvage pools,
automobile auctions, and recyclers, are required to report vehicles
that are deemed a total loss to NMVTIS and update the data at
least every 30 days.

(d) According to NMVTIS, 87 percent of departments of motor
vehicle titling data from the entire United States, including all of
the California Department of Motor Vehicles titling data, is
currently represented in NMVTIS and the database is expanding
daily.

(e) Federal law provides that NMVTIS must be supported
through user fees from government and private users and may not
be dependent on federal funding. The NMVTIS operator is
authorized to assess and collect user fees not to exceed the cost of
operating the system, not permitting any profits to be made by the
operator. Federal funding and investments by the NMVTIS
operator account for over $40 million in support of operations
since 1997. Fees to state government users are not projected to be
adequate to provide sufficient revenue to defray all anticipated
operating costs. It is crucial to the success of NMVTIS that new
applications be developed to generate sufficient nonstate
government user fees so that NMVTIS may continue its operations.

(f) It is the intent of the Legislature in enacting Section 17 of
this act to ensure that every motor vehicle dealer licensed in this
state obtain a NMVTIS vehicle history report for every used vehicle
that will be offered for retail sale and that any used vehicle that
has been titled or reported as salvage or junk as indicated by the
NMVTIS vehicle history report be identified as such. By becoming
the first and largest state in the country to require the use of
NMVTIS vehicle history reports by dealers in retail used vehicle
transactions, this act will not only benefit the California consumer,
it will also strengthen and financially support NMVTIS.