BILL ANALYSIS

C.S.H.B. 2202
By: Pickett
Appropriations
Committee Report (Substituted)
BACKGROUND AND PURPOSE
Primary functions of the recently created Texas Department of Motor Vehicles (TxDMV) include, among others, administering the collection of motor vehicle-related fees and regulating the sale of motor vehicles. Fees collected by TxDMV are used primarily to fund the state's highway system and TxDMV is currently funded by money appropriated out of the state highway fund. Interested parties contend that TxDMV should be funded through administrative fees and other revenue collected by TxDMV. The parties are also of the opinion that TxDMV's fee structure is in need of simplification and that the board needs more flexibility with regard to its regulatory authority. C.S.H.B. 2202 seeks to address these issues.
RULEMAKING AUTHORITY
It is the committee's opinion that rulemaking authority is expressly granted to the board of the Texas Department of Motor Vehicles in SECTIONS 19, 25, 43, and 69 of this bill.
ANALYSIS
C.S.H.B. 2202 amends the Transportation Code to establish the Texas Department of Motor Vehicles (TxDMV) fund as a special fund in the treasury outside the general revenue fund and the state highway fund consisting of the following: money appropriated by the legislature to TxDMV; money allocated to pay fund accounting costs and related liabilities of the fund; gifts, grants, and donations received by TxDMV; money required by law to be deposited to the fund; interest earned on money in the fund; and other revenue received by TxDMV. The bill prohibits money appropriated to TxDMV for Automobile Burglary and Theft Prevention Authority purposes and other revenue collected or received by the authority from being deposited into the fund. The bill limits TxDMV's use of money deposited in the state treasury to the credit of the TxDMV fund to support TxDMV's operations and the administration and enforcement of TxDMV functions or to pay the accounting costs and related liabilities for the fund. The bill exempts the fund from Government Code provisions regarding the appropriation of unobligated fund balances to the general revenue fund and the use of dedicated revenue. The bill requires the board of TxDMV by rule to prescribe the classification types of businesses that are authorized to perform certain TxDMV functions; the duties and obligations of an authorized business; the type and amount of any bonds that may be required for a business to perform certain functions; and the fees that may be charged or retained by an authorized business. The bill authorizes the executive director of TxDMV to authorize a business entity to perform a TxDMV function in accordance with those rules.
C.S.H.B. 2202 requires $59 million of existing revenue from fees collected or received by TxDMV under the automated registration and titling system from November 1, 2009, to August 31, 2013, to be transferred to and deposited in the TxDMV fund on September 1, 2013. The bill establishes that, to the extent that revenue required to be deposited was, before September 1, 2013, being used as collateral or a source of payment for the repayment of any loans, bonds, credit agreements, public securities, or other obligations, that revenue remains subject to being used as collateral or a source of payment for those obligations. The bill requires, however, that such an obligation first be paid from the state highway fund and subjects the TxDMV fund to the obligation only to the extent the state highway fund is depleted at the time the obligation matures and becomes due.
C.S.H.B. 2202 removes and repeals provisions relating to full- and limited-service deputy county assessor-collectors and instead requires the board of TxDMV by rule to prescribe the classification types of deputies performing titling and registration duties, the duties and obligations of deputies, the type and amount of any bonds that may be required by a county assessor-collector for a deputy to perform titling and registration duties, and the fees that may be charged or retained by deputies. The bill authorizes a county assessor-collector, with the approval of the commissioners court of the county, to deputize an individual or business entity to perform titling and registration services in accordance with those rules. The bill requires a commercial fleet buyer who is a deputy authorized by the bill and who utilizes the dealer title process developed to provide a method to submit title transactions to the county in which the commercial fleet buyer is a deputy, in order for the motor vehicle purchased by the deputy to qualify for the exemption from provisions governing the duty of a vehicle dealer on the sale of certain vehicles, to also have authority to accept an application for registration and application for title transfer that the county assessor may accept. The bill authorizes a deputy appointed on or before August 31, 2013, under provisions repealed by the bill to continue to perform the authorized services until the effective date of the rules the board adopts regarding the types of deputies authorized to perform titling and registration duties. The bill exempts a violation of the board's rules from provisions relating to a general penalty for certain violations concerning vehicle title and registration.
C.S.H.B. 2202 authorizes TxDMV to establish one or more escrow accounts in the TxDMV fund, rather than the state highway fund, for the prepayment of fees relating to 72-hour or 144-hour registration permits, permits relating to vehicle size and weight, or motor carrier registration.
C.S.H.B. 2202 authorizes TxDMV to collect a fee, in addition to other registration fees for the issuance of a license plate, a set of license plates, or another device used as the registration insignia, to cover the expenses of collecting those registration fees, including a service charge for registration by mail. The bill requires the board by rule to set the fee at a certain amount and authorizes the county tax assessor-collector, a private entity with which a county tax assessor-collector contracts, or a deputy assessor-collector to retain a portion of the fee as provided by board rule, with the remainder deposited to the credit of the TxDMV fund. The bill prohibits TxDMV, if such a fee is collected, from collecting certain other processing and transaction fees. The bill, in provisions that take effect on the effective date of the board's rules regarding the registration processing and handling fee added by the bill, changes the amount of the service charge a county assessor-collector may retain, rather than collect, from each applicant registering a vehicle by mail from $1 to the amount determined by the board for the registration processing and handling fee added by the bill.
C.S.H.B. 2202 adds certain specified vehicle registration fees collected by a county assessor-collector to the fees that are exempt from being credited to the county road and bridge fund and specifies that the portion of those collections and the portion of the collections from an optional county fee for the county road and bridge fund sent to TxDMV is for deposit to the credit of the state highway fund.
C.S.H.B. 2202 establishes that certain fees sent to TxDMV bear interest for the benefit of the TxDMV fund, if applicable, at an annual rate of 10 percent beginning on the 60th day after the date the county assessor-collector collects the fee. The bill specifies that the fee collected for the automated registration and titling system is to be adopted by the board of TxDMV by rule, changes the fee amount from $1 to not less than 50 cents nor more than $1, and requires the fee to be collected and deposited into a subaccount in the TxDMV fund. The bill authorizes TxDMV to use money collected from the fee to provide for or enhance necessary infrastructure for certain registration, permitting, titling, licensing, and enforcement purposes. The bill expands TxDMV's authorized use of money collected from that fee to include purposes relating to permitting, including vehicle size and weight permitting, and licensing and enforcement procedures. The bill, in provisions that take effect on the effective date of the board's rules regarding the registration processing and handling fee added by the bill, removes a provision requiring a county assessor-collector to receive a $1.90 fee for each receipt issued with regard to the registration of vehicles and instead requires a county assessor-collector to retain for each such receipt the amount determined by the board for the registration processing and handling fee added by the bill.
C.S.H.B. 2202 requires portions of certain fees collected from applicants for permits for oversize or overweight vehicles to be deposited to the credit of the TxDMV fund. The bill specifies that the fee associated with the issuance of prorated credit for a destroyed or permanently inoperable vehicle for which a permit for excess axle or gross weight was issued is a fee adopted by the board instead of TxDMV. The bill requires the application fee for a heavy equipment permit to be established by TxDMV in consultation with the Texas Transportation Commission instead of by the commission.
C.S.H.B. 2202 amends the Family Code, Occupations Code, and Transportation Code to require certain fees, civil penalties, and money, as applicable, to be deposited to the credit of the TxDMV fund, including some amounts that are currently deposited to the credit of the state highway fund.
C.S.H.B. 2202 amends the Finance Code to make conforming changes.
C.S.H.B. 2202 repeals the following provisions of the Transportation Code:
·  Section 520.008
·  Section 520.009
·  Section 520.0091
·  Section 520.0092
EFFECTIVE DATE
Except as otherwise provided, September 1, 2013.
COMPARISON OF ORIGINAL AND SUBSTITUTE
While C.S.H.B. 2202 may differ from the original in minor or nonsubstantive ways, the following comparison is organized and highlighted in a manner that indicates the substantial differences between the introduced and committee substitute versions of the bill.
INTRODUCED
/ HOUSE COMMITTEE SUBSTITUTE
/
SECTION 1. Section 232.014(b), Family Code, is amended. / SECTION 1. Same as introduced version.
No equivalent provision. / SECTION 2. Section 348.005, Finance Code, is amended to read as follows:
Sec. 348.005. ITEMIZED CHARGE. An amount in a retail installment contract is an itemized charge if the amount is not included in the cash price and is the amount of:
(1) fees for registration, certificate of title, and license and any additional registration fees charged by a [full service] deputy as authorized by rules adopted under Section 520.0071 [502.114], Transportation Code;
(2) any taxes;
(3) fees or charges prescribed by law and connected with the sale or inspection of the motor vehicle; and
(4) charges authorized for insurance, service contracts, warranties, or a debt cancellation agreement by Subchapter C.
No equivalent provision. / SECTION 3. Section 353.006, Finance Code, is amended to read as follows:
Sec. 353.006. ITEMIZED CHARGE. An amount in a retail installment contract is an itemized charge if the amount is not included in the cash price and is the amount of:
(1) fees for registration, certificate of title, and license and any additional registration fees charged by a [full service] deputy as authorized by rules adopted under Section 520.0071 [502.114], Transportation Code;
(2) any taxes;
(3) fees or charges prescribed by law and connected with the sale or inspection of the commercial vehicle;
(4) charges authorized for insurance, service contracts, and warranties by Subchapter C; and
(5) advances or payments authorized under Section 353.402(b) or (c) made by the retail seller to or for the benefit of the retail buyer.
SECTION 2. Section 2301.156, Occupations Code, is amended. / SECTION 4. Same as introduced version.
SECTION 3. Section 2301.801(c), Occupations Code, is amended. / SECTION 5. Same as introduced version.
SECTION 4. Section 501.0234(b), Transportation Code, is amended to read as follows:
(b) This section does not apply to a motor vehicle:
(1) that has been declared a total loss by an insurance company in the settlement or adjustment of a claim;
(2) for which the title has been surrendered in exchange for:
(A) a salvage vehicle title or salvage record of title issued under this chapter;
(B) a nonrepairable vehicle title or nonrepairable vehicle record of title issued under this chapter or Subchapter D, Chapter 683; or
(C) an ownership document issued by another state that is comparable to a document described by Paragraph (A) or (B);
(3) with a gross weight in excess of 11,000 pounds; or
(4) purchased by a commercial fleet buyer who
is a full-service deputy authorized by rules adopted under Section 520.0071 [520.008] and who utilizes the dealer title application process developed to provide a method to submit title transactions to the county in which the commercial fleet buyer is a full-service deputy. / SECTION 6. Section 501.0234(b), Transportation Code, is amended to read as follows:
(b) This section does not apply to a motor vehicle:
(1) that has been declared a total loss by an insurance company in the settlement or adjustment of a claim;
(2) for which the title has been surrendered in exchange for:
(A) a salvage vehicle title or salvage record of title issued under this chapter;
(B) a nonrepairable vehicle title or nonrepairable vehicle record of title issued under this chapter or Subchapter D, Chapter 683; or
(C) an ownership document issued by another state that is comparable to a document described by Paragraph (A) or (B);
(3) with a gross weight in excess of 11,000 pounds; or
(4) purchased by a commercial fleet buyer who:
(A) is a [full-service] deputy authorized by rules adopted under Section 520.0071;