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A BILL TO BE ENTITLED
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AN ACT
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relating to title requirements, identification number inspections, |
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and evidence of ownership for certain vehicles. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Section 501.032, Transportation Code, is amended |
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by amending Subsection (a) and adding Subsection (a-1) to read as |
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follows: |
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(a) A [In addition to any requirement established by |
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department rule, a] motor vehicle, trailer, or semitrailer must |
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have an identification number inspection under Section 501.0321 if: |
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(1) the department does not have a motor vehicle |
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record for the motor vehicle, trailer, or semitrailer in the |
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department's registration and title system, and the owner of the |
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motor vehicle, trailer, or semitrailer is filing a bond with the |
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department under Section 501.053; |
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(2) the motor vehicle, trailer, or semitrailer was |
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last titled or registered outside of the United States and imported |
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into the United States; or |
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(3) the owner or person claiming ownership requires an |
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assigned or reassigned identification number under Section |
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501.033. |
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(a-1) The department by rule may establish additional |
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categories of motor vehicles, trailers, or semitrailers not |
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specified in Subsection (a) that are required to have vehicle |
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identification number inspections under Section 501.0321. |
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SECTION 2. Section 501.0321(a), Transportation Code, is |
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amended to read as follows: |
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(a) An inspection required under Section 501.032 or a rule |
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adopted under that section must verify, as applicable, the identity |
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of: |
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(1) a motor vehicle; |
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(2) a trailer or semitrailer; |
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(3) a frame, body, or motor of a motor vehicle; or |
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(4) an item of equipment not required to be titled but |
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that may be registered under Chapter 502 or issued licensed plates |
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under Chapter 504. |
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SECTION 3. Section 501.053, Transportation Code, is amended |
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by amending Subsections (a) and (c) and adding Subsections (b-1) |
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and (b-2) to read as follows: |
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(a) As an alternative to the procedure provided by Section |
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501.052, the person may obtain a title by filing a bond with the |
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department if the vehicle is in the possession of the applicant and: |
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(1) there is no security interest on the vehicle; |
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(2) any lien on the vehicle is at least 10 years old; |
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[or] |
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(3) the person provides a release of all liens less |
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than 10 years old; or |
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(4) the lienholder of any lien less than 10 years old |
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has gone out of business, the security interest on the vehicle was |
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not transferred to or otherwise acquired by another person, and the |
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applicant provides sufficient evidence of those facts in the form |
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and manner prescribed by department rule [with bond]. |
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(b-1) On receipt of a bond filing under this section, the |
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department shall notify any recorded owner or lienholder of the |
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vehicle of the bond filing. |
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(b-2) If a person who files a bond under this section does |
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not hold a general distinguishing number issued under Subchapter B, |
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Chapter 503, the department: |
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(1) may only issue title on or after the 30th day after |
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the date on which the person submits an application for title under |
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Section 501.023; and |
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(2) may not issue title if any recorded owner or |
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lienholder with an interest in the vehicle objects to the issuance |
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of the title. |
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(c) An interested person has a right of action to recover on |
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the bond for a breach of the bond's condition. The aggregate |
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liability of the surety to all persons may not exceed the amount of |
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the bond. Failure to object to the issuance of title under |
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Subsection (b-2)(2) does not waive the right of an interested |
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person to bring an action to recover on the bond filed under this |
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section. |
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SECTION 4. Section 501.091, Transportation Code, is amended |
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by adding Subdivision (1-a) to read as follows: |
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(1-a) "Auction sales receipt" means a document |
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certifying the sale of a motor vehicle at auction by a law |
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enforcement agency or public sale for a lien foreclosure. |
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SECTION 5. The heading to Section 501.0925, Transportation |
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Code, is amended to read as follows: |
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Sec. 501.0925. INSURANCE COMPANY NOT REQUIRED TO SURRENDER |
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EVIDENCE OF OWNERSHIP [CERTIFICATES OF TITLE] IN CERTAIN |
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SITUATIONS. |
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SECTION 6. Sections 501.0925(a), (b), (c), (d), and (f), |
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Transportation Code, are amended to read as follows: |
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(a) An insurance company that acquires, through payment of a |
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claim, ownership or possession of a motor vehicle covered by a |
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[certificate of] title or a manufacturer's certificate of origin |
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that the company is unable to obtain may obtain from the department |
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not earlier than the 30th day after the date of payment of the |
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claim: |
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(1) a salvage vehicle title for a salvage motor |
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vehicle; |
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(2) a nonrepairable vehicle title for a nonrepairable |
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motor vehicle; or |
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(3) a [regular certificate of] title for a motor |
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vehicle other than a salvage motor vehicle or a nonrepairable motor |
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vehicle. |
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(b) An application for a title under Subsection (a) must be |
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submitted to the department on a form prescribed by the department |
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and include: |
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(1) a statement that the insurance company has |
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provided at least two written notices attempting to obtain the |
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evidence of ownership [certificate of title] for the motor vehicle; |
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and |
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(2) evidence acceptable to the department that the |
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insurance company has made payment of a claim involving the motor |
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vehicle. |
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(c) An insurance company that acquires, through payment of a |
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claim, ownership or possession of a motor vehicle covered by a |
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[certificate of] title or a manufacturer's certificate of origin |
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for which the company is unable to obtain proper assignment of the |
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title or manufacturer's certificate of origin [certificate] may |
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obtain from the department not earlier than the 30th day after the |
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date of payment of the claim: |
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(1) a salvage vehicle title for a salvage motor |
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vehicle; |
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(2) a nonrepairable vehicle title for a nonrepairable |
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motor vehicle; or |
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(3) a [regular certificate of] title for a motor |
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vehicle other than a salvage motor vehicle or a nonrepairable motor |
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vehicle. |
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(d) An application for a title under Subsection (c) must be |
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submitted to the department on a form prescribed by the department |
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and include: |
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(1) a statement that the insurance company has |
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provided at least two written notices attempting to obtain a proper |
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assignment of the evidence of ownership [certificate of title]; and |
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(2) the evidence of ownership [certificate of title]. |
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(f) An insurance company that acquires, through payment of a |
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claim, ownership or possession of a motor vehicle, salvage motor |
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vehicle, or nonrepairable motor vehicle covered by an out-of-state |
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title or out-of-state ownership document may obtain from the |
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department a title, salvage vehicle title, or nonrepairable vehicle |
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title, as appropriate, if: |
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(1) the motor vehicle was damaged, stolen, or |
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recovered in this state; |
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(2) the motor vehicle owner from whom the company |
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acquired ownership resides in this state; or |
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(3) otherwise allowed by department rule. |
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SECTION 7. The heading to Section 501.100, Transportation |
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Code, is amended to read as follows: |
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Sec. 501.100. APPLICATION FOR [REGULAR CERTIFICATE OF] |
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TITLE FOR SALVAGE VEHICLE. |
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SECTION 8. Sections 501.100(a) and (f), Transportation |
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Code, are amended to read as follows: |
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(a) The owner of a motor vehicle for which a nonrepairable |
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vehicle title was issued prior to September 1, 2003, [or] for which |
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a salvage vehicle title or salvage record of title has been issued, |
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or for which a comparable out-of-state ownership document for a |
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salvage motor vehicle has been issued, may apply for a title under |
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Section 501.023 after the motor vehicle has been repaired, rebuilt, |
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or reconstructed and, in addition to any other requirement of law, |
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only if the application: |
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(1) describes each major component part used to |
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repair, rebuild, or reconstruct the motor vehicle; |
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(2) states the name of each person from whom the parts |
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used in repairing, rebuilding, or reconstructing [assembling] the |
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vehicle were obtained; and |
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(3) shows the identification number required by |
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federal law to be affixed to or inscribed on the part. |
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(f) The department may not issue a [regular] title for a |
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motor vehicle based on a: |
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(1) nonrepairable vehicle title issued on or after |
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September 1, 2003, or comparable out-of-state ownership document or |
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record, or evidence of a notation described by Section |
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501.09113(a)(2) on an out-of-state ownership document or record in |
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the National Motor Vehicle Title Information System; |
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(2) receipt issued under Section 501.1003(b); or |
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(3) certificate of authority issued under Chapter 683. |
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SECTION 9. Section 501.1003, Transportation Code, is |
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amended to read as follows: |
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Sec. 501.1003. SALVAGE VEHICLE DEALER RESPONSIBILITIES. |
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(a) If a salvage vehicle dealer acquires ownership of a |
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nonrepairable motor vehicle or salvage motor vehicle for the |
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purpose of dismantling, scrapping, or destroying the motor vehicle, |
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the dealer shall, before the 31st day after the date the dealer |
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acquires the motor vehicle, submit to the department a report |
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stating that the motor vehicle will be dismantled, scrapped, or |
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destroyed. The dealer shall: |
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(1) make the report in a manner prescribed by the |
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department; and |
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(2) submit with the report a properly assigned |
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manufacturer's certificate of origin, [regular certificate of] |
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title, nonrepairable vehicle title, salvage vehicle title, auction |
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sales receipt, or comparable out-of-state ownership document for |
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the motor vehicle. |
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(b) After receiving the report and title, manufacturer's |
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certificate of origin, auction sales receipt, or document, the |
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department shall issue the salvage vehicle dealer a receipt for the |
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manufacturer's certificate of origin, [regular certificate of] |
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title, nonrepairable vehicle title, salvage vehicle title, auction |
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sales receipt, or comparable out-of-state ownership document. |
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(c) The department shall adopt rules to notify the salvage |
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vehicle dealer if the vehicle was not issued a printed title, but |
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has a record of title in the department's titling system. |
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SECTION 10. Section 501.053, Transportation Code, as |
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amended by this Act, applies only to a bond for a motor vehicle |
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title that is filed on or after the effective date of this Act. |
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SECTION 11. This Act takes effect September 1, 2025. |