1-1     By:  Cain                                              S.B. No. 520
 1-2           (In the Senate - Filed February 16, 1999; February 17, 1999,
 1-3     read first time and referred to Committee on Economic Development;
 1-4     March 15, 1999, reported adversely, with favorable Committee
 1-5     Substitute by the following vote:  Yeas 5, Nays 0; March 15, 1999,
 1-6     sent to printer.)
 1-7     COMMITTEE SUBSTITUTE FOR S.B. No. 520                   By:  Sibley
 1-8                            A BILL TO BE ENTITLED
 1-9                                   AN ACT
1-10     relating to discharge of a lien on a motor vehicle.
1-11           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-12           SECTION 1.  Section 501.115, Transportation Code, is amended
1-13     to read as follows:
1-14           Sec. 501.115.  DISCHARGE OF LIEN.  (a)  Except as provided by
1-15     Subsection (c), when [When] a debt or claim secured by a lien has
1-16     been satisfied, the lienholder shall, within a reasonable time not
1-17     to exceed the maximum time allowed by Section 348.408, Finance Code
1-18     [21 days from receipt of the final payment], execute and deliver to
1-19     the assessor-collector of the county in which the owner resides:
1-20                 (1)  [owner, or the owner's designee,] a discharge of
1-21     the lien on a form prescribed by the department;
1-22                 (2)  the vehicle's certificate of title;
1-23                 (3)  an application for a new title in the name of the
1-24     owner of the vehicle; and
1-25                 (4)  the fee required by Section 501.138(a).
1-26           (b)  On delivery of [The owner may present] the discharge,
1-27     [and] certificate of title, application, and fee under Subsection
1-28     (a), [to the county assessor-collector with an application for a
1-29     new certificate of title and] the department shall issue a new
1-30     certificate of title.
1-31           (c)  If the final payment received by a lienholder is from a
1-32     dealer designated by the owner to act on behalf of the owner in the
1-33     transfer of title and registration of the vehicle, the lienholder
1-34     shall, in the time provided by this section, deliver to the
1-35     designated dealer a discharge of lien on a form prescribed by the
1-36     department.  A lienholder may not be charged a fee for complying
1-37     with this subsection.  In this subsection, "dealer" means a person
1-38     who has a dealer general distinguishing number under Chapter 503.
1-39           SECTION 2.  Section 348.005, Finance Code, is amended to read
1-40     as follows:
1-41           Sec. 348.005.  ITEMIZED CHARGE.  An amount in a retail
1-42     installment contract is an itemized charge if the amount is not
1-43     included in the cash price and is the amount of:
1-44                 (1)  fees for registration, certificate of title, and
1-45     license, including:
1-46                       (A)  [and] any additional registration fees
1-47     charged by a full service deputy under Section 502.114,
1-48     Transportation Code; and
1-49                       (B)  fees for issuance of a new certificate of
1-50     title on discharge of a lien as provided by Section 501.115,
1-51     Transportation Code, if a lien is to be recorded on a certificate
1-52     of title under Chapter 501, Transportation Code;
1-53                 (2)  any taxes;
1-54                 (3)  fees or charges prescribed by law and connected
1-55     with the sale or inspection of the motor vehicle; and
1-56                 (4)  charges authorized for insurance, service
1-57     contracts, or warranties by Subchapter C.
1-58           SECTION 3.  Section 342.502, Finance Code, is amended by
1-59     adding Subsection (d) to read as follows:
1-60           (d)  On a loan subject to Subchapter E a lender may assess
1-61     and collect from the borrower an amount for a fee for issuance of a
1-62     new certificate of title on discharge of a lien as provided by
1-63     Section 501.115, Transportation Code, if  a lien is to be recorded
1-64     on a certificate of title under Chapter 501, Transportation Code.
 2-1           SECTION 4.  Section 3A.852, Title 79, Revised Statutes
 2-2     (Article 5069-3A.852, Vernon's Texas Civil Statutes), is amended by
 2-3     adding Subsection (c) to read as follows:
 2-4           (c)  On a loan subject to Subchapter E a lender may assess
 2-5     and collect from the borrower an amount for a fee for issuance of a
 2-6     new certificate of title on discharge of a lien as provided by
 2-7     Section 501.115, Transportation Code, if  a lien is to be recorded
 2-8     on a certificate of title under Chapter 501, Transportation Code.
 2-9           SECTION 5.  The changes in law made by this Act apply only to
2-10     a lien established on or after the effective date of this Act.  A
2-11     lien established before the effective date of this Act is governed
2-12     by the law in effect when the lien was established, and that law is
2-13     continued in effect for that purpose.
2-14           SECTION 6.  (a)  Except as provided by Subsections (b) and
2-15     (c) of this section, this Act takes effect September 1, 1999.
2-16           (b)  Section 3 of this Act takes effect only if the Act of
2-17     the 76th Legislature, Regular Session, 1999, relating to
2-18     nonsubstantive additions to and corrections in enacted codes takes
2-19     effect.
2-20           (c)  Section 4 of this Act takes effect only if the Act of
2-21     the 76th Legislature, Regular Session, 1999, relating to
2-22     nonsubstantive additions to and corrections in enacted codes does
2-23     not take effect.
2-24           SECTION 7.  The importance of this legislation and the
2-25     crowded condition of the calendars in both houses create an
2-26     emergency and an imperative public necessity that the
2-27     constitutional rule requiring bills to be read on three several
2-28     days in each house be suspended, and this rule is hereby suspended.
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