89R8973 GP-D     By: Paul H.B. No. 4368       A BILL TO BE ENTITLED   AN ACT   relating to title requirements, identification number inspections,   and evidence of ownership for certain vehicles.          BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:          SECTION 1.  Section 501.032, Transportation Code, is amended   by amending Subsection (a) and adding Subsection (a-1) to read as   follows:          (a)  A [In addition to any requirement established by   department rule, a] motor vehicle, trailer, or semitrailer must   have an identification number inspection under Section 501.0321 if:                (1)  the department does not have a motor vehicle   record for the motor vehicle, trailer, or semitrailer in the   department's registration and title system, and the owner of the   motor vehicle, trailer, or semitrailer is filing a bond with the   department under Section 501.053;                (2)  the motor vehicle, trailer, or semitrailer was   last titled or registered outside of the United States and imported   into the United States; or                (3)  the owner or person claiming ownership requires an   assigned or reassigned identification number under Section   501.033.          (a-1)  The department by rule may establish additional   categories of motor vehicles, trailers, or semitrailers not   specified in Subsection (a) that are required to have vehicle   identification number inspections under Section 501.0321.          SECTION 2.  Section 501.0321(a), Transportation Code, is   amended to read as follows:          (a)  An inspection required under Section 501.032 or a rule   adopted under that section must verify, as applicable, the identity   of:                (1)  a motor vehicle;                (2)  a trailer or semitrailer;                (3)  a frame, body, or motor of a motor vehicle; or                (4)  an item of equipment not required to be titled but   that may be registered under Chapter 502 or issued licensed plates   under Chapter 504.          SECTION 3.  Section 501.053, Transportation Code, is amended   by amending Subsections (a) and (c) and adding Subsections (b-1)   and (b-2) to read as follows:          (a)  As an alternative to the procedure provided by Section   501.052, the person may obtain a title by filing a bond with the   department if the vehicle is in the possession of the applicant and:                (1)  there is no security interest on the vehicle;                (2)  any lien on the vehicle is at least 10 years old;   [or]                (3)  the person provides a release of all liens less   than 10 years old; or                (4)  the lienholder of any lien less than 10 years old   has gone out of business, the security interest on the vehicle was   not transferred to or otherwise acquired by another person, and the   applicant provides sufficient evidence of those facts in the form   and manner prescribed by department rule [with bond].          (b-1)  On receipt of a bond filing under this section, the   department shall notify any recorded owner or lienholder of the   vehicle of the bond filing.          (b-2)  If a person who files a bond under this section does   not hold a general distinguishing number issued under Subchapter B,   Chapter 503, the department:                (1)  may only issue title on or after the 30th day after   the date on which the person submits an application for title under   Section 501.023; and                (2)  may not issue title if any recorded owner or   lienholder with an interest in the vehicle objects to the issuance   of the title.          (c)  An interested person has a right of action to recover on   the bond for a breach of the bond's condition.  The aggregate   liability of the surety to all persons may not exceed the amount of   the bond.  Failure to object to the issuance of title under   Subsection (b-2)(2) does not waive the right of an interested   person to bring an action to recover on the bond filed under this   section.          SECTION 4.  Section 501.091, Transportation Code, is amended   by adding Subdivision (1-a) to read as follows:                (1-a)  "Auction sales receipt" means a document   certifying the sale of a motor vehicle at auction by a law   enforcement agency or public sale for a lien foreclosure.          SECTION 5.  The heading to Section 501.0925, Transportation   Code, is amended to read as follows:          Sec. 501.0925.  INSURANCE COMPANY NOT REQUIRED TO SURRENDER   EVIDENCE OF OWNERSHIP [CERTIFICATES OF TITLE] IN CERTAIN   SITUATIONS.          SECTION 6.  Sections 501.0925(a), (b), (c), (d), and (f),   Transportation Code, are amended to read as follows:          (a)  An insurance company that acquires, through payment of a   claim, ownership or possession of a motor vehicle covered by a   [certificate of] title or a manufacturer's certificate of origin   that the company is unable to obtain may obtain from the department   not earlier than the 30th day after the date of payment of the   claim:                (1)  a salvage vehicle title for a salvage motor   vehicle;                (2)  a nonrepairable vehicle title for a nonrepairable   motor vehicle; or                (3)  a [regular certificate of] title for a motor   vehicle other than a salvage motor vehicle or a nonrepairable motor   vehicle.          (b)  An application for a title under Subsection (a) must be   submitted to the department on a form prescribed by the department   and include:                (1)  a statement that the insurance company has   provided at least two written notices attempting to obtain the   evidence of ownership [certificate of title] for the motor vehicle;   and                (2)  evidence acceptable to the department that the   insurance company has made payment of a claim involving the motor   vehicle.          (c)  An insurance company that acquires, through payment of a   claim, ownership or possession of a motor vehicle covered by a   [certificate of] title or a manufacturer's certificate of origin   for which the company is unable to obtain proper assignment of the   title or manufacturer's certificate of origin [certificate] may   obtain from the department not earlier than the 30th day after the   date of payment of the claim:                (1)  a salvage vehicle title for a salvage motor   vehicle;                (2)  a nonrepairable vehicle title for a nonrepairable   motor vehicle; or                (3)  a [regular certificate of] title for a motor   vehicle other than a salvage motor vehicle or a nonrepairable motor   vehicle.          (d)  An application for a title under Subsection (c) must be   submitted to the department on a form prescribed by the department   and include:                (1)  a statement that the insurance company has   provided at least two written notices attempting to obtain a proper   assignment of the evidence of ownership [certificate of title]; and                (2)  the evidence of ownership [certificate of title].          (f)  An insurance company that acquires, through payment of a   claim, ownership or possession of a motor vehicle, salvage motor   vehicle, or nonrepairable motor vehicle covered by an out-of-state   title or out-of-state ownership document may obtain from the   department a title, salvage vehicle title, or nonrepairable vehicle   title, as appropriate, if:                (1)  the motor vehicle was damaged, stolen, or   recovered in this state;                (2)  the motor vehicle owner from whom the company   acquired ownership resides in this state; or                (3)  otherwise allowed by department rule.          SECTION 7.  The heading to Section 501.100, Transportation   Code, is amended to read as follows:          Sec. 501.100.  APPLICATION FOR [REGULAR CERTIFICATE OF]   TITLE FOR SALVAGE VEHICLE.          SECTION 8.  Sections 501.100(a) and (f), Transportation   Code, are amended to read as follows:          (a)  The owner of a motor vehicle for which a nonrepairable   vehicle title was issued prior to September 1, 2003, [or] for which   a salvage vehicle title or salvage record of title has been issued,   or for which a comparable out-of-state ownership document for a   salvage motor vehicle has been issued, may apply for a title under   Section 501.023 after the motor vehicle has been repaired, rebuilt,   or reconstructed and, in addition to any other requirement of law,   only if the application:                (1)  describes each major component part used to   repair, rebuild, or reconstruct the motor vehicle;                (2)  states the name of each person from whom the parts   used in repairing, rebuilding, or reconstructing [assembling] the   vehicle were obtained; and                (3)  shows the identification number required by   federal law to be affixed to or inscribed on the part.          (f)  The department may not issue a [regular] title for a   motor vehicle based on a:                (1)  nonrepairable vehicle title issued on or after   September 1, 2003, or comparable out-of-state ownership document or   record, or evidence of a notation described by Section   501.09113(a)(2) on an out-of-state ownership document or record in   the National Motor Vehicle Title Information System;                (2)  receipt issued under Section 501.1003(b); or                (3)  certificate of authority issued under Chapter 683.          SECTION 9.  Section 501.1003, Transportation Code, is   amended to read as follows:          Sec. 501.1003.  SALVAGE VEHICLE DEALER RESPONSIBILITIES.   (a)  If a salvage vehicle dealer acquires ownership of a   nonrepairable motor vehicle or salvage motor vehicle for the   purpose of dismantling, scrapping, or destroying the motor vehicle,   the dealer shall, before the 31st day after the date the dealer   acquires the motor vehicle, submit to the department a report   stating that the motor vehicle will be dismantled, scrapped, or   destroyed.  The dealer shall:                (1)  make the report in a manner prescribed by the   department; and                (2)  submit with the report a properly assigned   manufacturer's certificate of origin, [regular certificate of]   title, nonrepairable vehicle title, salvage vehicle title, auction   sales receipt, or comparable out-of-state ownership document for   the motor vehicle.          (b)  After receiving the report and title, manufacturer's   certificate of origin, auction sales receipt, or document, the   department shall issue the salvage vehicle dealer a receipt for the   manufacturer's certificate of origin, [regular certificate of]   title, nonrepairable vehicle title, salvage vehicle title, auction   sales receipt, or comparable out-of-state ownership document.          (c)  The department shall adopt rules to notify the salvage   vehicle dealer if the vehicle was not issued a printed title, but   has a record of title in the department's titling system.          SECTION 10.  Section 501.053, Transportation Code, as   amended by this Act, applies only to a bond for a motor vehicle   title that is filed on or after the effective date of this Act.          SECTION 11.  This Act takes effect September 1, 2025.