By Davis of Harris                                    H.B. No. 2938
         77R7330 DWS-D                           
                                A BILL TO BE ENTITLED
 1-1                                   AN ACT
 1-2     relating to enforcement of motor vehicle financial responsibility
 1-3     requirements.
 1-4           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
 1-5           SECTION 1. Chapter 601, Transportation Code, is amended by
 1-6     adding Subchapters N and O to read as follows:
 1-7               SUBCHAPTER N. MOTOR VEHICLE INSURANCE DATABASE
 1-8           Sec. 601.421.  ESTABLISHMENT OF DATABASE. The department
 1-9     shall establish a motor vehicle insurance database to collect and
1-10     make available information provided under this subchapter relating
1-11     to expiration and cancellation of motor vehicle liability policies
1-12     provided in this state. The department may adopt rules necessary to
1-13     establish and operate the database.
1-14           Sec. 601.422.  INSURANCE COMPANY NOTICE TO DEPARTMENT. Each
1-15     insurance company providing a motor vehicle liability policy in
1-16     this state shall notify the department if the policy is canceled or
1-17     expires and is not renewed. The insurance company may give the
1-18     notice by facsimile transmission, electronic mail, or certified
1-19     mail and shall send the notice not later than 48 hours after the
1-20     time of the cancellation or expiration. The notice must include the
1-21     information required by department rule.
1-22           Sec. 601.423.  DEPARTMENT USE OF INFORMATION. (a)  Not later
1-23     than 48 hours after the time the department receives a notice under
1-24     Section 601.422, the department shall enter the information in the
 2-1     database.
 2-2           (b)  The department shall make the information in the
 2-3     database available to law enforcement officers in the same manner
 2-4     that information is available to those officers concerning a
 2-5     person's previous motor vehicle offenses and outstanding warrants.
 2-6              (Sections 601.424-601.450 reserved for expansion)
 2-7            SUBCHAPTER O. FINANCIAL RESPONSIBILITY IN CONNECTION
 2-8                      WITH MOTOR VEHICLE SECURING LOAN
 2-9           Sec. 601.451.  APPLICABILITY. This subchapter applies to a
2-10     loan, including a retail installment transaction, secured by a
2-11     motor vehicle for which proof of financial responsibility is
2-12     required to be established under this chapter.
2-13           Sec. 601.452.  SHOWING PROOF OF FINANCIAL RESPONSIBILITY TO
2-14     LIENHOLDER. (a)  Each loan to which this subchapter applies must
2-15     include, in at least 10-point type, a provision that requires the
2-16     borrower to show the lienholder proof of financial responsibility
2-17     under this chapter not later than the 10th day after the date that
2-18     the lienholder requests the borrower to show the proof. A
2-19     lienholder may make a request under this section by facsimile
2-20     transmission, electronic mail, or certified mail.
2-21           (b)  Failure of the borrower to timely show the proof is a
2-22     default on the loan, and the lienholder may:
2-23                 (1)  obtain insurance on the vehicle to satisfy the
2-24     requirements of this chapter and add the amount of the premiums to
2-25     the amount of the loan; or
2-26                 (2)  pursue the lienholder's other default remedies.
2-27           Sec. 601.453.  INSURANCE COMPANY NOTICE TO LIENHOLDER. Each
 3-1     insurance company providing a motor vehicle liability policy on a
 3-2     vehicle subject to a loan to which this subchapter applies shall
 3-3     notify each lienholder on the vehicle if the policy is canceled or
 3-4     expires and is not renewed. The insurance company may give the
 3-5     notice by facsimile transmission, electronic mail, or certified
 3-6     mail and shall send the notice not later than 48 hours after the
 3-7     time of the cancellation or expiration.
 3-8           SECTION 2. Sections 601.191(b) and (c), Transportation Code,
 3-9     are amended to read as follows:
3-10           (b)  Except as provided by Subsections (c) and (d), an
3-11     offense under this section is a misdemeanor punishable by a fine of
3-12     not less than $175 or more than $500 [$350].
3-13           (c)  If a person has been previously convicted of an offense
3-14     under this section, an offense under this section is a misdemeanor
3-15     punishable by:
3-16                 (1)  a fine of not less than $500 [$350] or more than
3-17     $1,000;
3-18                 (2)  confinement in jail for a term not to exceed six
3-19     months; or
3-20                 (3)  both the fine and confinement.
3-21           SECTION 3. This Act takes effect September 1, 2001.
3-22           SECTION 4. Subchapter O, Chapter 601, Transportation Code, as
3-23     added by this Act, applies only to a loan contract entered into on
3-24     or after the effective date of this Act.
3-25           SECTION 5. (a)  The change in law made by this Act to Section
3-26     601.191, Transportation Code, applies only to an offense committed
3-27     on or after the effective date of this Act.  For the purposes of
 4-1     this section, an offense is committed before the effective date of
 4-2     this Act if any element of the offense occurs before that date.
 4-3           (b)  An offense committed before the effective date of this
 4-4     Act is governed by the law in effect when the offense was
 4-5     committed, and the former law is continued in effect for that
 4-6     purpose.