By Gutierrez, Thompson, Haggerty, Chavez,             H.B. No. 1752
                                A BILL TO BE ENTITLED
 1-1                                   AN ACT
 1-2     relating to proof of financial responsibility in connection with
 1-3     operation of a motor vehicle and creating the motor vehicle
 1-4     insurance verification program; providing criminal penalties.
 1-5           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
 1-6           SECTION 1. Section 601.053(a), Transportation Code, is
 1-7     amended to read as follows:
 1-8           (a)  As a condition of operating in this state a motor
 1-9     vehicle to which Section 601.051 applies, the operator of the
1-10     vehicle on request shall provide to a peace officer, as defined by
1-11     Article 2.12, Code of Criminal Procedure, or a person involved in
1-12     an accident with the operator evidence of financial responsibility
1-13     by exhibiting:
1-14                 (1)  a motor vehicle liability insurance policy
1-15     covering the vehicle that satisfies Subchapter D or a photocopy of
1-16     the policy;
1-17                 (2)  a standard proof of motor vehicle liability
1-18     insurance form prescribed by the department [Texas Department of
1-19     Insurance] under Section 601.081 and issued by a liability insurer
1-20     for the motor vehicle;
1-21                 (3)  an insurance binder that confirms the operator is
1-22     in compliance with this chapter;
1-23                 (4)  a surety bond certificate issued under Section
1-24     601.121;
1-25                 (5)  a certificate of a deposit with the comptroller
 2-1     covering the vehicle issued under Section 601.122;
 2-2                 (6)  a copy of a certificate of a deposit with the
 2-3     appropriate county judge covering the vehicle issued under Section
 2-4     601.123; or
 2-5                 (7)  a certificate of self-insurance covering the
 2-6     vehicle issued under Section 601.124 or a photocopy of the
 2-7     certificate.
 2-8           SECTION 2. Section 601.081, Transportation Code, is amended
 2-9     to read as follows:
2-10           Sec. 601.081.  STANDARD PROOF OF MOTOR VEHICLE LIABILITY
2-11     INSURANCE FORM. (a)  The department shall provide for the
2-12     production of a standard proof of motor vehicle liability insurance
2-13     form for use by insurers.  The department may contract with another
2-14     person for production of the form.
2-15           (b)  Each insurer issuing a standard proof of motor vehicle
2-16     liability insurance form shall use a form produced by the
2-17     department.
2-18           (c)  The department may adopt rules to implement this
2-19     section, including rules relating to the use of security features
2-20     for the form.
2-21           (d)  The [A] standard proof of motor vehicle liability
2-22     insurance form prescribed by the department [Texas Department of
2-23     Insurance] must include:
2-24                 (1)  the name of the insurer;
2-25                 (2)  the insurance policy number;
2-26                 (3)  the policy period;
2-27                 (4)  the name and address of each insured;
 3-1                 (5)  the policy limits or a statement that the coverage
 3-2     of the policy complies with the minimum amounts of motor vehicle
 3-3     liability insurance required by this chapter; and
 3-4                 (6)  the make and model of each covered vehicle.
 3-5           SECTION 3. Chapter 601, Transportation Code, is amended by
 3-6     adding Subchapter N to read as follows:
 3-7        SUBCHAPTER N.  MOTOR VEHICLE INSURANCE VERIFICATION PROGRAM;
 3-8                              INSURER REPORTING
 3-9           Sec. 601.441.  DEFINITIONS. In this subchapter:
3-10                 (1)  "Database" means the motor vehicle insurance
3-11     verification database established under this subchapter.
3-12                 (2)  "Designated agent" means a person administering
3-13     the program under contract with the department.
3-14                 (3)  "Program" means the motor vehicle insurance
3-15     verification program established under this subchapter.
3-16           Sec. 601.442.  ESTABLISHMENT OF PROGRAM. (a)  The department
3-17     shall establish a motor vehicle insurance verification program to
3-18     verify compliance with this chapter.
3-19           (b)  The department by rule shall administer the program with
3-20     the assistance of a designated agent.
3-21           (c)  The program must comply with the Driver's Privacy
3-22     Protection Act of 1994 (18 U.S.C. Section 2721 et seq.).
3-23           Sec. 601.443.  DESIGNATED AGENT:  MAINTENANCE OF DATABASE.
3-24     (a)  The department shall contract with a person to act as the
3-25     department's designated agent under this subchapter.  The contract
3-26     may be awarded under a competitive bid procedure as provided by
3-27     department rule.  The contract may not obligate the department to
 4-1     pay more money than the public safety director determines will be
 4-2     available from fees collected under Section 502.1715.
 4-3           (b)  The designated agent shall develop and maintain a
 4-4     computer database to manage and provide access to information
 4-5     provided under Sections 601.445, 601.446, and 601.447.
 4-6           (c)  The database shall be developed, maintained, and
 4-7     administered in accordance with guidelines established by the
 4-8     department to permit efficient access by courts and state and local
 4-9     law enforcement agencies.
4-10           Sec. 601.444.  VERIFICATION: NOTICE FOR NONCOMPLIANCE. (a)
4-11     With information provided by the department and the Texas
4-12     Department of Transportation, the designated agent shall, at least
4-13     monthly:
4-14                 (1)  update the database with the motor vehicle
4-15     insurance information provided by insurers under Section 601.445;
4-16     and
4-17                 (2)  compare all current motor vehicle registrations
4-18     provided by the Texas Department of Transportation against the
4-19     database.
4-20           (b)  If a comparison under this section shows that a motor
4-21     vehicle is not insured, the department may direct that the
4-22     designated agent mail a notice to the owner of the motor vehicle
4-23     stating that the owner has 45 days to provide:
4-24                 (1)  proof of the owner's financial responsibility in a
4-25     form described by Section 601.053;
4-26                 (2)  a letter from an insurance agent or company
4-27     verifying that the person had the required motor vehicle insurance
 5-1     coverage on the date of action specified by the database query;
 5-2                 (3)  proof of an exemption from the owner's financial
 5-3     responsibility under Section 601.052; or
 5-4                 (4)  proof that the owner of the motor vehicle is
 5-5     insured by an insurance company located in another state because
 5-6     the owner is a member of the United States armed forces, a student
 5-7     attending an educational institution in this state and residing in
 5-8     this state, or a faculty member of an educational institution in
 5-9     this state who is residing in this state.
5-10           (c)  If an owner of a motor vehicle has not provided proof of
5-11     financial responsibility to the designated agent by the 45th day
5-12     after the date the notice is sent, the department may direct the
5-13     designated agent to provide an additional notice.
5-14           Sec. 601.445.  INFORMATION PROVIDED BY INSURANCE COMPANY. (a)
5-15     Each insurance company providing motor vehicle liability policies
5-16     in this state shall provide the designated agent a record of each
5-17     motor vehicle insurance policy, including:
5-18                 (1)  the insurance policy number, effective date, and
5-19     expiration date of the policy;
5-20                 (2)  the name, address, and driver's license number of
5-21     each driver insured by the policy; and
5-22                 (3)  the make, model, year, and vehicle identification
5-23     number of each vehicle covered by the policy.
5-24           (b)  Each insurance company shall provide information
5-25     required by Subsection (a) to the designated agent in an electronic
5-26     submission monthly or more frequently as prescribed by the public
5-27     safety director.
 6-1           (c)  If information provided by an insurance company to the
 6-2     designated agent is incorrect, the insurance company shall provide
 6-3     corrected information to the designated agent in a timely manner as
 6-4     prescribed by the public safety director after the date the
 6-5     insurance company receives notice of the error from the designated
 6-6     agent.
 6-7           (d)  Information provided by an insurance company under this
 6-8     section remains the property of the insurance company and may not
 6-9     be sold or made available except to enforce a state law.
6-10           Sec. 601.446.  INFORMATION PROVIDED BY DEPARTMENT. (a)  The
6-11     department shall provide the designated agent the following
6-12     information on each Texas driver's license holder:
6-13                 (1)  the holder's name and address; and
6-14                 (2)  the driver's license number and expiration date.
6-15           (b)  For each motor vehicle covered by a bond filed under
6-16     Section 601.121, a deposit made under Section 601.123, or a
6-17     certificate of self-insurance issued under Section 601.124, the
6-18     department shall provide to the designated agent:
6-19                 (1)  the owner's name and address; and
6-20                 (2)  the owner's driver's license number and expiration
6-21     date.
6-22           (c)  The department shall notify the designated agent of:
6-23                 (1)  the cancellation of a bond filed under Section
6-24     601.121;
6-25                 (2)  the cancellation of a deposit filed under Section
6-26     601.123; or
6-27                 (3)  the termination of a certificate of self-insurance
 7-1     issued under Section 601.124.
 7-2           (d)  This section does not require the department to provide
 7-3     to the designated agent information that is not in the possession
 7-4     of the department.
 7-5           (e)  The department shall provide the information under this
 7-6     section in an electronic submission to the designated agent in a
 7-7     timely manner as prescribed by the public safety director.
 7-8           (f)  The department is not liable to any person for damages
 7-9     arising as a result of providing information as required by this
7-10     section.
7-11           Sec. 601.447.  INFORMATION PROVIDED BY TEXAS DEPARTMENT OF
7-12     TRANSPORTATION. (a)  The Texas Department of Transportation shall
7-13     provide the department or its designated agent the following
7-14     information for each vehicle to which this chapter applies, to the
7-15     extent the information is in the Texas Department of
7-16     Transportation's records:
7-17                 (1)  the owner's name and address;
7-18                 (2)  the make, model, and year of the vehicle;
7-19                 (3)  the vehicle identification number and vehicle
7-20     license plate number; and
7-21                 (4)  the date the certificate of title was issued for
7-22     the vehicle.
7-23           (b)  The Texas Department of Transportation is not required
7-24     to provide information under this section about a vehicle
7-25     registered under Subchapter G, Chapter 502.
7-26           (c)  The Texas Department of Transportation shall provide the
7-27     information under this section and each change to information
 8-1     previously provided under this section in a weekly report that
 8-2     includes the information for registrations and changes occurring
 8-3     during the week preceding the date of the report.
 8-4           (d)  The Texas Department of Transportation shall provide by
 8-5     electronic submission to the department or its designated agent any
 8-6     information required under this section in a timely manner as
 8-7     prescribed by the public safety director.
 8-8           Sec. 601.448.  RULES. (a)  The department may adopt rules as
 8-9     necessary to implement this subchapter.
8-10           (b)  The department shall consult with the Texas Department
8-11     of Transportation about rules that affect the reporting of
8-12     information relating to vehicle registrations.
8-13           (c)  The department by rule may waive a requirement that
8-14     particular information be provided to the designated agent if the
8-15     department finds that the information is not useful for enforcing
8-16     this chapter or that the burden of collecting or reporting the
8-17     information is not justified by its value in enforcing this
8-18     chapter.
8-19           (d)  The Texas Department of Insurance shall adopt rules for
8-20     enforcing compliance for insurance companies reporting under
8-21     Section 601.445.
8-22           Sec. 601.449.  INFORMATION REMAINS PROPERTY OF AGENCIES. (a)
8-23     Information provided by the department under Section 601.446 and
8-24     information provided by the Texas Department of Transportation
8-25     under Section 601.447 remains the property of each agency and may
8-26     not be sold or made available except to enforce a state law.
8-27           (b)  Information provided by the department under Section
 9-1     601.446 and information provided by the Texas Department of
 9-2     Transportation under Section 601.447 is confidential and not
 9-3     subject to disclosure under Chapter 552, Government Code.
 9-4           Sec. 601.450.  LIABILITY OF CERTAIN OFFICERS, EMPLOYEES, AND
 9-5     AGENTS. An officer or employee of an insurance company, an officer,
 9-6     employee, or agent of the department, or an officer, employee,
 9-7     agent, or statutory agent of the Texas Department of Transportation
 9-8     is not liable in a civil action for an act performed in good faith
 9-9     in providing information in compliance with this subchapter.
9-10           Sec. 601.451.  VIOLATION; CRIMINAL PENALTY. (a)  A person
9-11     commits an offense if the person knowingly releases information
9-12     maintained by the department or its designated agent under this
9-13     subchapter except to enforce a state law.
9-14           (b)  An offense under this section is a Class A misdemeanor.
9-15           Sec. 601.452.  REVIEW OF PROGRAM. (a)  After January 1, 2007,
9-16     and before September 1, 2007, the department shall review the
9-17     effectiveness of the program and determine the amount by which
9-18     compliance with this chapter has increased between September 1,
9-19     2001, and the date of the review.  The department may coordinate
9-20     with the Texas Department of Insurance to conduct the review.  If
9-21     the department determines that compliance has not increased by at
9-22     least eight percent during that period, this subchapter and Section
9-23     502.1715 expire September 1, 2007.
9-24           (b)  This section expires September 2, 2007.
9-25           SECTION 4. Section 502.104, Transportation Code, is amended
9-26     to read as follows:
9-27           Sec. 502.104.  DISPOSITION OF CERTAIN SPECIAL FEES. Each
 10-1    Monday a county assessor-collector shall send to the department an
 10-2    amount equal to collections for the preceding week for:
 10-3                (1)  each transfer fee collected under Section 502.175;
 10-4    and
 10-5                (2)  each fee collected under Section 502.169(b),
 10-6    502.1715, or 502.279.
 10-7          SECTION 5. Subchapter D, Chapter 502, Transportation Code, is
 10-8    amended by adding Section 502.1715 to read as follows:
 10-9          Sec. 502.1715.  ADDITIONAL FEE FOR EVIDENCE OF FINANCIAL
10-10    RESPONSIBILITY SYSTEM. (a)  In addition to other fees imposed for
10-11    registration of a motor vehicle, at the time of application for
10-12    registration or renewal of registration of a motor vehicle for
10-13    which the owner is required to submit evidence of financial
10-14    responsibility under Section 502.153, the applicant shall pay a fee
10-15    of $1.
10-16          (b)  Fees collected under this section shall be deposited to
10-17    the credit of the state highway fund.  The department shall use
10-18    money appropriated from the state highway fund that represents
10-19    those fees to administer Subchapter N, Chapter 601, and to
10-20    reimburse the Department of Public Safety for expenses in
10-21    administering that subchapter.
10-22          (c)  The department and the Department of Public Safety shall
10-23    adopt rules and develop forms necessary to administer this section.
10-24          SECTION 6. Sections 601.371(d) and (e), Transportation Code,
10-25    are amended to read as follows:
10-26          (d)  Except as provided by Subsection (e), an offense under
10-27    this section is a misdemeanor punishable by[:]
 11-1                [(1)]  a fine of not less than $100 or more than $750
 11-2    [$500; and]
 11-3                [(2)  confinement in county jail for a term of not less
 11-4    than 72 hours or more than six months].
 11-5          (e)  If it is shown on the trial of an offense under this
 11-6    section that the person has previously been convicted two or more
 11-7    times of an offense under this section or under Section 521.457,
 11-8    the offense is punishable as a Class B [A] misdemeanor.
 11-9          SECTION 7. This Act takes effect September 1, 2001.
11-10          SECTION 8. (a)  As soon as practicable after the effective
11-11    date of this Act, the Department of Public Safety shall appoint a
11-12    technical advisory committee to assist the department in developing
11-13    the initial rules required for implementation of Subchapter N,
11-14    Chapter 601, Transportation Code, as added by this Act. The
11-15    technical advisory committee must include representatives of the
11-16    affected insurance companies and representatives of the Texas
11-17    Department of Transportation.
11-18          (b)  The technical advisory committee shall prepare
11-19    recommended rules for consideration by the Department of Public
11-20    Safety not later than March 1, 2002.
11-21          (c)  This section expires and the technical advisory
11-22    committee is abolished September 1, 2002.
11-23          SECTION 9. (a)  Not later than September 1, 2002:
11-24                (1)  the Department of Public Safety shall contract
11-25    with an entity to serve as the designated agent under Subchapter N,
11-26    Chapter 601, Transportation Code, as added by this Act; and
11-27                (2)  the Department of Public Safety shall adopt any
 12-1    rules necessary to implement Subchapter N, Chapter 601,
 12-2    Transportation Code, as added by this Act.
 12-3          (b)  Except as provided by Subsection (c) of this section, a
 12-4    motor vehicle insurance company is not required to report under
 12-5    Section 601.445, Transportation Code, as added by this Act, before
 12-6    September 1, 2002.
 12-7          (c)  The Department of Public Safety by rule may designate,
 12-8    by market share, premium volume, or another similar characteristic,
 12-9    smaller motor vehicle insurance companies that are not required to
12-10    report under Section 601.445, Transportation Code, as added by this
12-11    Act, before September 1, 2003.
12-12          (d)  The Department of Public Safety is not required to
12-13    report under Sections 601.446(b) and (c), Transportation Code, as
12-14    added by this Act, before September 1, 2002.