82R6502 JAM-F

By: Williams S.B. No. 1035

A BILL TO BE ENTITLED

AN ACT

relating to motor vehicle title services; providing penalties.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

SECTION 1. Effective January 1, 2012, Section 520.051(2), Transportation Code, is amended to read as follows:

(2) "Motor vehicle title service" means any person that for compensation directly or indirectly assists other persons in obtaining motor vehicle title or registration documents by submitting, transmitting, or sending applications for title documents to the appropriate government agencies, including county tax assessor-collectors.

SECTION 2. Effective January 1, 2012, Section 520.052, Transportation Code, is amended to read as follows:

Sec. 520.052. APPLICABILITY. This subchapter applies to any motor vehicle title service operating in this state [a county:

[(1) that has a population of more than 500,000; or

[(2) in which the commissioners court by order has adopted this subchapter].

SECTION 3. Effective January 1, 2012, Subchapter E, Chapter 520, Transportation Code, is amended by adding Section 520.0521 to read as follows:

Sec. 520.0521. PURPOSE; LIBERAL CONSTRUCTION. (a) The purpose of this subchapter is to ensure a sound system of distributing and selling motor vehicles through:

(1) the licensing and regulation of titling services and title service runners; and

(2) the enforcement of this chapter to prevent fraud, unfair practices, and discrimination.

(b) This subchapter shall be liberally construed to give effect to the purpose of this subchapter.

SECTION 4. Effective January 1, 2012, Section 520.053, Transportation Code, is amended to read as follows:

Sec. 520.053. LICENSE REQUIRED. A person may not act as a motor vehicle title service or act as a title service runner [an agent for that business] unless that person holds a license issued under this subchapter.

SECTION 5. Effective January 1, 2012, Subchapter E, Chapter 520, Transportation Code, is amended by adding Section 520.0531 to read as follows:

Sec. 520.0531. COUNTY PERMITS. (a) A county tax assessor-collector may:

(1) require motor vehicle title services and title service runners to obtain permits to operate within that county's jurisdiction; and

(2) charge a fee for a permit issued under Subdivision (1).

(b) A county's permit fee charged under Subsection (a)(2):

(1) may not exceed the amount of a fee established under Section 520.0541; and

(2) must be used for the administration and enforcement of the county's motor vehicle title service and title service runner permitting program.

SECTION 6. Effective January 1, 2012, Section 520.054, Transportation Code, is amended to read as follows:

Sec. 520.054. [GENERAL] LICENSE APPLICATION REQUIREMENTS. (a) An applicant for a motor vehicle title service license or a title service runner license must apply on a form prescribed by the department [county tax assessor-collector]. The application form must be signed by the applicant and accompanied by the application fee.

(b) An application must include:

(1) information required by department rule [the applicant's name, business address, and business telephone number];

(2) an acknowledgement by the county tax assessor-collector on a form prescribed by the department that the motor vehicle title service or title service runner intends to conduct business in that county [the name under which the applicant will do business];

(3) an affirmation that all acts of a motor vehicle title service's employees, agents, contractors, or title service runners are acts of the motor vehicle title service for the purposes of this subchapter [the physical address of each office from which the applicant will conduct business]; and

(4) an affirmation of the truth of the information contained in the application signed and sworn to before an officer authorized to administer oaths [a statement indicating whether the applicant has previously applied for a license under this subchapter, the result of the previous application, and whether the applicant has ever been the holder of a license under this subchapter that was revoked or suspended;

[(5) information from the applicant as required by the county tax assessor-collector to establish the business reputation and character of the applicant;

[(6) the applicant's federal tax identification number;

[(7) the applicant's state sales tax number; and

[(8) any other information required by rules adopted under this subchapter].

(c) The issuance of an acknowledgement under Subsection (b)(2) does not constitute approval by the county tax assessor-collector for a motor vehicle title service or title service runner to conduct business in that county if the county requires a permit under Section 520.0531.

SECTION 7. Effective January 1, 2012, Subchapter E, Chapter 520, Transportation Code, is amended by adding Section 520.0541 to read as follows:

Sec. 520.0541. LICENSE FEES. (a) The department by rule shall adopt fees for an original license and a renewal license for motor vehicle title services and for an original license and a renewal license for title service runners.

(b) The fee for an original license for a motor vehicle title service or for a title service runner may not exceed $500.

(c) The fee for a renewal license for a motor vehicle title service or for a title service runner may not exceed $200.

(d) A fee collected under this section shall be deposited to the credit of the state highway fund. Section 403.095, Government Code, does not apply to money received by the department and deposited to the credit of the state highway fund under this subchapter.

SECTION 8. Effective January 1, 2012, Subchapter E, Chapter 520, Transportation Code, is amended by adding Section 520.0542 to read as follows:

Sec. 520.0542. SECURITY REQUIREMENT. The department may not issue or renew a motor vehicle title service license unless the applicant provides to the department satisfactory proof that the applicant has purchased a properly executed surety bond in the amount of $50,000 with a good and sufficient surety approved by the department.

SECTION 9. Effective January 1, 2012, Section 520.057, Transportation Code, is amended to read as follows:

Sec. 520.057. RECORDS. (a) A holder of a motor vehicle title service license shall:

(1) maintain records as required by department rule [this section] on a form prescribed and made available by the department [county tax assessor-collector] for each transaction in which the license holder receives compensation; and

(2) provide a copy of the record to the county tax assessor-collector. [The records shall include:

[(1) the date of the transaction;

[(2) the name, age, address, sex, driver's license number, and a legible photocopy of the driver's license for each customer; and

[(3) the license plate number, vehicle identification number, and a legible photocopy of proof of financial responsibility for the motor vehicle involved].

(b) Records required by this section must be maintained for four years from the date of the transaction [A motor vehicle title service shall keep:

[(1) two copies of all records required under this section for at least two years after the date of the transaction;

[(2) legible photocopies of any documents submitted by a customer; and

[(3) legible photocopies of any documents submitted to the county tax assessor-collector].

SECTION 10. Effective January 1, 2012, Section 520.058, Transportation Code, is amended to read as follows:

Sec. 520.058. INSPECTION OF RECORDS. A motor vehicle title service license holder or any of its employees shall allow during business hours an inspection of records required under Section 520.057 by the department, the county tax assessor-collector, or a peace officer [on the premises of the motor vehicle title service at any reasonable time to verify, check, or audit the records].

SECTION 11. Effective January 1, 2012, Sections 520.059(a) and (b), Transportation Code, are amended to read as follows:

(a) The department [county tax assessor-collector] may deny, suspend, revoke, or reinstate a license issued under this subchapter.

(b) The department [county tax assessor-collector] shall adopt rules that establish grounds for the denial, suspension, revocation, or reinstatement of a license and rules that establish procedures for disciplinary action. Procedures issued under this subchapter are subject to Chapter 2001, Government Code.

SECTION 12. Effective January 1, 2012, Sections 520.060(a) and (b), Transportation Code, are amended to read as follows:

(a) A license issued under this subchapter for a title service runner expires on the first anniversary of the date of issuance and may be renewed annually on or before the expiration date on payment of the required renewal fee.

(b) A license issued under this subchapter for a motor vehicle title service expires on the second anniversary of the date of issuance and may be renewed biennially on or before the expiration date on payment of the required renewal fee [A person who is otherwise eligible to renew a license may renew an unexpired license by paying to the county tax assessor-collector before the expiration date of the license the required renewal fee. A person whose license has expired may not engage in activities that require a license until the license has been renewed under this section].

SECTION 13. Effective January 1, 2012, Section 520.061, Transportation Code, is amended to read as follows:

Sec. 520.061. CRIMINAL PENALTY. (a) A person commits an offense if the person violates this subchapter or a rule adopted by the department [county tax assessor-collector] under this subchapter.

(b) Except as provided by Subsection (c), an [An] offense under this section is a Class A misdemeanor.

(c) An offense is a state jail felony if it is based on:

(1) a violation of Section 520.053; or

(2) the falsification of information required under Section 520.054 or 520.0542.

SECTION 14. Effective January 1, 2012, Subchapter E, Chapter 520, Transportation Code, is amended by adding Section 520.0611 to read as follows:

Sec. 520.0611. CIVIL PENALTY. (a) A person who violates this subchapter is subject to a civil penalty of not more than $10,000 for each violation.

(b) Each day a violation occurs constitutes a separate violation.

(c) The department by rule shall establish factors to be considered in determining the amount of the civil penalty.

SECTION 15. Effective January 1, 2012, Section 520.062(a), Transportation Code, is amended to read as follows:

(a) The attorney general or a [A] district attorney of the county in which the motor vehicle title service is located may bring an action to enjoin the operation of a motor vehicle title service if the motor vehicle title service license holder or a runner of the motor vehicle title service while in the scope of the runner's employment is found to have committed one or more violations of [convicted of more than one offense under] this subchapter.

SECTION 16. Section 520.063, Transportation Code, is amended to read as follows:

Sec. 520.063. EXEMPTIONS. The following persons and their agents are exempt from the licensing and other requirements established by this subchapter:

(1) a franchised motor vehicle dealer or independent motor vehicle dealer who holds a general distinguishing number issued by the department under Chapter 503;

(2) a vehicle lessor holding a license issued by the department [Motor Vehicle Board] under Chapter 2301, Occupations Code, or a trust or other entity that is specifically not required to obtain a lessor license under Section 2301.254(a) of that code; and

(3) a vehicle lease facilitator holding a license issued by the department [Motor Vehicle Board] under Chapter 2301, Occupations Code.

SECTION 17. Effective January 1, 2012, Subchapter E, Chapter 520, Transportation Code, is amended by adding Section 520.064 to read as follows:

Sec. 520.064. DEPARTMENT EXEMPT FROM FILING FEE. Notwithstanding the other provisions of this subchapter, the department is not required to pay a filing fee when filing a complaint or other enforcement action.

SECTION 18. Effective January 1, 2012, Sections 520.051(3), (4), and (5), 520.055, 520.056, 520.059(c) and (d), and 520.060(c), (d), (e), (f), and (g), Transportation Code, are repealed.

SECTION 19. Not later than November 1, 2011, the Texas Department of Transportation shall adopt rules and forms to administer Subchapter E, Chapter 520, Transportation Code, as amended by this Act.

SECTION 20. The change in law made by this Act to Section 520.061, Transportation Code, applies only to an offense committed on or after January 1, 2012. An offense committed before that date is governed by the law in effect when the offense was committed, and the former law is continued in effect for that purpose. For purposes of this subsection, an offense was committed before January 1, 2012, if any element of the offense was committed before that date.

SECTION 21. Except as otherwise provided by this Act, this Act takes effect September 1, 2011.