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OLR Bill Analysis
sSB 183
AN ACT IMPLEMENTING THE RECOMMENDATIONS OF THE
DEPARTMENT OF MOTOR VEHICLES.
TABLE OF CONTENTS:
SUMMARY
§§ 1-3 — ELECTRONIC ISSUANCE LICENSES
Requires registration and title companies that file applications electronically to get an
electronic issuance license from DMV and establishes a licensing process and licensee
operating requirements; lowers the threshold at which these companies are required to file
electronically; increases the total amount of surety bonds these companies must provide
§ 4 — MOTOR VEHICLE TRANSPORTER REGISTRA TION
Imposes a late fee for failing to timely renew a transporter registration and prohibits
DMV from renewing one 45 days after expiration
§ 5 — DEALER AND REPAIRER BACKGROUND CHE CKS
Modifies the requirements for fingerprinting and background checks for applicants for a
new or renewed motor vehicle dealer’s or repairer’s license
§ 6 — MOTOR VEHICLE RECYCLERS SURETY BON DS
Requires motor vehicle recyclers to furnish a $25,000 surety bond
§§ 7-9 — COMMERCIAL DRIVING SCHOOLS AND INSTRUCTORS
Increases the surety bond amount for driving schools to $50,000 per location, requires
driving instructors to wear ID badges while providing instruction, and makes other
changes related to driving school and instructor licensees
§ 10 — ALTERED, COMPOSITE, GREY-MARKET, AND SALVAGE
VEHICLES
Requires that salvage vehicles be inspected by DMV-authorized repairers rather than
DMV and defines the different categories of altered vehicles that must be inspected before
titling and registering them
§§ 11-32 — MINOR AND TECHNICAL CHANGES
Makes numerous minor and technical changes, principally to change references to
“commercial driver’s instruction permit” to “commercial learner’s permit,” conforming to
the term used in federal law
BACKGROUND
2024SB-00183-R000310-BA.DOCX
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SUMMARY
This bill makes several changes to the Department of Motor Vehicles
(DMV) business licensing statutes and other DMV-related changes.
Among other things, it:
1. requires registration and title companies that file registration and
title applications electronically to get an electronic issuance
license,
2. requires motor vehicle recyclers to furnish a $25,000 surety bond,
3. increases the surety bond amount for driving schools to $50,000
per location,
4. requires driving instructors to wear ID badges while providing
instruction, and
5. requires that salvage vehicles be inspected by DMV-authorized
repairers rather than DMV.
EFFECTIVE DATE: October 1, 2024, unless otherwise noted below.
§§ 1-3 — ELECTRONIC ISSUANCE LICENSES
Requires registration and title companies that file applications electronically to get an
electronic issuance license from DMV and establishes a licensing process and licensee
operating requirements; lowers the threshold at which these companies are required to file
electronically; increases the total amount of surety bonds these companies must provide
The bill modifies the regulatory treatment of people and entities that
are engaged in the business of electronically filing, on behalf of their
customers, registration or title applications with DMV (i.e., registration
and title companies).
Under current law and department regulations, th e DMV
commissioner may permit or require a registration and title company to
file these applications electronically if, among other things, he
determines that the company is qualified based on the conditions set in
statute and department regulations.
The bill replaces this authorization with a statutory licensing
structure for registration and title companies. The bill prohibits 2024SB-00183-R000310-BA.DOCX
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registration and title companies from filing registration and title
applications electronically without an “electronic issuance license.” But
it allows currently authorized registration and title companies to
continue filing applications electronically until January 1, 2025. After
this date, these companies are no longer allowed to use the electronic
system without an electronic issuance license.
The bill specifically excludes the following entities from the electronic
issuance license requirement: licensed motor vehicle dealers, licensed
leasing or rental companies, and DMV contractors.
EFFECTIVE DATE: October 1, 2024, except for the provision allowing
currently authorized companies to operate until January 1, 2025, which
takes effect upon passage.
Threshold for Filing Electronically
The bill lowers the threshold at which a registration and title
company may be required to file applications online. Current law allows
the DMV commissioner to require a registration and title company to
file applications electronically if he determines that the company files an
average of seven or more applications per month. The bill lowers this
threshold to five and instead mandates that the DMV commissioner
require these companies to file electronically. It also specifies that
companies meeting this threshold must apply for an electronic issuance
license.
Under the bill, as under existing law, any company that fails or
refuses to file applications electronically upon the commissioner’s
request must pay a $25 fee for each application it submits.
License Application and Renewal Process
The bill requires electronic issuance license applicants to submit an
application with the information DMV requires and pay a $250 license
fee. Applicants for an initial license or a renewal must be fingerprinted
and undergo a state and national criminal records check. If the applicant
is a firm or corporation, each officer or major stockholder must be
fingerprinted and undergo the check. 2024SB-00183-R000310-BA.DOCX
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Under the bill, the DMV commissioner may refuse to grant or renew
a license for any reason he reasonably deems necessary. It specifically
authorizes him to refuse a license if the applicant or holder (or officer or
major stockholder) has been found liable in a civil action or convicted of
a violation of laws (1) related to the business of filing registration or title
applications or (2) involving fraud, larceny, stalking, embezzlement,
bribery, or deprivation or misappropriation of property. The bill also
prohibits DMV from granting or renewing a license if the applicant or
holder is delinquent on paying sales tax for any business for which it
was obligated to. Before refusing to grant or renew a license for any of
these reasons, DMV must notify the applicant or licensee and give them
an opportunity for a hearing. Under current regulations, DMV can
remove a company’s authorization for the electronic system under
generally the same circumstances, but is not required to provide
opportunity for a hearing (Conn. Agencies Regs., § 14-15d-4).
Under the bill, licenses are generally renewed biennially, but DMV
must adopt an initial renewal schedule so that license renewals happen
on a staggered basis. If the schedule causes a license to expire more or
less than two years from its initial issuance, DMV may charge a prorated
license fee. In addition to the required background check, licensees must
also fully disclose any civil judgement or conviction described above
under penalty of false statement.
At least 45 days before a company’s license expires, DMV must send
the company a renewal application in the way the commissioner
determines. Licensees who do not file the renewal application with the
$250 license fee before their license expires are prohibited from using
DMV’s electronic system. Applications filed after the license expires are
subject to a $100 late fee. DMV may not renew an electronic issuance
license that has been expired more than 45 days.
Surety Bonds
Under current regulations and the bill, registration and title
companies that are authorized (or, under the bill, licensed) to file
applications electronically must provide surety bonds (see
BACKGROUND). The bill increases, from $25,000 to $45,000, the total 2024SB-00183-R000310-BA.DOCX
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amount of surety bonds they must provide.
Current regulations require registration and title companies to
provide surety bonds in the following amounts: (1) $20,000 as security
for monetary loss that DMV suffers as a result of the licensee’s loss,
destruction, or misuse of the license plates the department assigned the
licensee and (2) $5,000 as security for monetary loss DMV suffers
because the licensee failed to remit registration and title fees (Conn.
Agencies Regs., § 14-15d-3(b) & (c)).
In addition to the bonds described above, the bill requires licensees
to furnish another $20,000 bond conditioned on the licensee complying
with applicable state and federal laws and regulations and provided as
indemnity for any losses a customer sustains because the licensee did
not comply with these laws or regulations. This bond must be executed
in the name of the state for the benefit of any aggrieved customer, but
the penalty of the bond may only be imposed on the DMV
commissioner’s order after a hearing.
The bill requires DMV to assess a $200 administrative fee against any
electronic issuance licensee that fails to show proof of bond renewal or
replacement before an existing bond expires.
License Plate Inventory
Under the bill, as under current regulations, DMV must issue to each
licensee an inventory of license plates and other materials related to
registration and title transactions. The company is responsible for all the
license plates DMV assigns to it. The bill specifies that licensees may use
the plates and materials only for registration and title transactions.
The bill specifically requires electronic issuance licensees who stop
conducting business to return license plates, title and registration
materials, and any applications that it did not act on or complete. The
licensee must do so within five business days of the license becoming
invalid or the business terminating. Violations are infractions (see
BACKGROUND).
Submission of Applications to DMV 2024SB-00183-R000310-BA.DOCX
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As under existing law for registration and title companies, electronic
issuance licensees must submit registration and title applications, along
with necessary documents, within 10 days after electronically issuing a
registration or title. The bill specifies that if the licensee fails to provide
DMV with the necessary documents, the department may not process
the received documents and must inform the licensee that it failed to
submit a completed application.
Consumer Protections and Required Disclosures
The bill establishes various consumer protections for customers of
electronic issuance licensees. It caps the fee that licensees may charge
their customers at $25 for each registration or title application.
Under the bill, a licensee may not (1) include the words “Department
of Motor Vehicles” or “DMV” or another indication of the department
in their business name or (2) act in any way that misleads customers to
believe that the licensee represents or otherwise is affiliated with the
department.
The bill also requires electronic issuance licensees to give customers
a disclosure form as the commissioner prescribes. The form must state
(1) the fee that the licensee charges for filing registration and title
applications, (2) that the licensee is not affiliated with the department,
(3) information on how the customer may file complaints about the
licensee with DMV, and (4) any other information DMV requires.
Licensees must require customers to acknowledge the information by
signing the form.
Penalty
The bill allows DMV, after notice and opportunity for a hearing, to
impose a civil penalty of up to $2,000 for violations of the electronic
issuance license laws, except for violations of the laws on (1) returning
license plates and other materials, (2) timely submitting registration and
title applications, (3) disclosure forms, and (4) the application fee cap.
§ 4 — MOTOR VEHICLE TRANSPORTER REGISTRATION
Imposes a late fee for failing to timely renew a transporter registration and prohibits
DMV from renewing one 45 days after expiration 2024SB-00183-R000310-BA.DOCX
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By law, motor vehicle transporters must annually renew their
registrations by the last day of March. The bill imposes a $100 late fee
for motor vehicle transporters who fail to renew their registration before
expiration. It also prohibits the commissioner from renewing any
transporter’s registration once it has been expired for more than 45 days.
After that timeframe, a person or entity would have to file an application
for a new license.
§ 5 — DEALER AND REPAIRER BACKGROUND CHE CKS
Modifies the requirements for fingerprinting and background checks for applicants for a
new or renewed motor vehicle dealer’s or repairer’s license
The bill modifies the requirements for fingerprinting and
background checks for applicants for a new or renewed motor vehicle
dealer’s or repairer’s license. Under current law, applicants must be
fingerprinted and undergo a state and national criminal history records
check no more than 30 days before submitting the application and
submit the results of the check to DMV. The bill eliminates the specified
timeframe and no longer requires the applicant to submit the results of
the check to DMV.
§ 6 — MOTOR VEHICLE RECYCLERS SURETY BON DS
Requires motor vehicle recyclers to furnish a $25,000 surety bond
The bill imposes a surety bond requirement on motor vehicle
recyclers, as is the case under existing law for other DMV-licensed
businesses (e.g., dealers and repairers). Applicants seeking a new license
or renewing one must furnish a $25,000 surety bond, conditioned on the
applicant or licensee complying with any state or federal law or
regulation relating to the business of operating a motor vehicle
recycler’s yard and provided as indemnity for customers’ losses due to
licensee actions that constitute grounds for license suspension or
revocation or the licensee going out of business. This bond must be
executed in the name of the state for the benefit of any aggrieved
customer, but the penalty of the bond may only be imposed on the DMV
commissioner’s order after a hearing.
The bill requires DMV to assess a $200 administrative fee against any
electronic issuance licensee that fails to show proof of bond renewal or 2024SB-00183-R000310-BA.DOCX
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replacement before an existing bond expires.
§§ 7-9 — COMMERCIAL DRIVING SCHOOLS AND INSTRUCTORS
Increases the surety bond amount for driving schools to $50,000 per location, requires
driving instructors to wear ID badges while providing instruction, and makes other
changes related to driving school and instructor licensees
Surety Bond Increase
Under current DMV regulations, driving schools must provide a
surety bond in the amount of $15,000 per location, up to $100,000 (Conn.
Agencies Regs., § 14-78-22). The bill increases the required surety bond
amount for commercial driving schools to $50,000 per location with no
cap.
By law, these bonds are conditioned on the licensee’s faithful
performance of any contract to provide instruction and held by DMV to
satisfy any execution issued against a school due to the school’s failure
to adhere to the contract.
School License Requirements
The bill explicitly allows a driving school licensee to operate a school
at an additional place of business, as long as they hold a license to
operate at that location and comply with the state driving school laws.
(Existing law implies this requirement by setting license fees for
additional locations, and the department requires each location to be
licensed in practice.)
Instructor ID Badges and Background Checks
The bill requires licensed driving instructors or master instructors to
wear an ID badge at all times when providing classroom or behind-the-
wheel instruction. The employing driving school must issue the badge,
which must contain (1) the licensee’s name, photo, and license number;
(2) the license expiration date; and (3) the driving school’s name.
The bill also requires instructor and master instructor licensees to be
fingerprinted and undergo a state and national criminal history records
check before their license is renewed. Under current regulations,
applicants for renewal only have to undergo a state criminal records
check (Conn. Agencies Regs., § 14-78-51). Under existing regulations 2024SB-00183-R000310-BA.DOCX
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and the bill, applicants must also undergo a child abuse and neglect
registry check.
The bill also requires licensees renewing their license to provide the
same evidence they had to when applying initially, such as evidence
that they held a driver’s license for the past five years, passed a physical
exam, and completed the required instructor training.
School’s Responsibility for Instructors
The bill also specifies that a school employing a licensed instructor or
master instructor is responsible for ensuring the instructor or master
instructor complies with driving school and driving instructor statutes
and regulations.
Expired Licenses
By law, DMV may not renew a driving school license, a driving
instructor license, or a master instructor license if it has been expired for
more than 60 days. The bill explicitly allows the holder of one of these
expired licenses to apply for a new license.
Penalties
By law, the DMV commissioner may suspend or revoke a license or
impose a civil penalty (up to $1,000) on any person or firm that violates
the driving school or instructor laws after notice and an opportunity for
a hearing. The bill explicitly allows him to impose these penalties for
violations of the associated regulations.
The bill also expands the commissioner’s authority to require that
restitution be made to a customer. Under current law, he may require a
licensee to do so; under the bill, he may also require this of unlicensed
people or firms.
§ 10 — ALTERED, COMPOSITE, GREY-MARKET, AND SALVAGE
VEHICLES
Requires that salvage vehicles be inspected by DMV-authorized repairers rather than
DMV and defines the different categories of altered vehicles that must be inspected before
titling and registering them
Current law establishes inspection requirements for vehicles that (1) 2024SB-00183-R000310-BA.DOCX
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have been reconstructed (i.e., materially altered from the original by
removing, adding, or substituting essential parts), (2) are composed
from several parts of other vehicles, (3) have been altered enough that
the vehicle no longer bears the characteristics of a specific make of motor
vehicle, or (4) have been declared a total loss by an insurance carrier and
subsequently reconstructed.
The bill instead breaks these vehicles out into four defined categories
and indicates the inspection requirements for each. Principally, it
changes who must inspect vehicles reconstructed after being declared a
total loss by an insurer.
Categories
The bill defines four types of vehicles: altered vehicles, composite
vehicles, grey-market vehicles, and salvage vehicles.
An “altered vehicle” is one that has been materially modified from its
original construction by removing, adding, or substituting essential
parts with new or used parts.
A “composite vehicle” is one that (1) is composed or assembled from
several parts of other vehicles; (2) is assembled from a motor vehicle kit;
or (3) has been altered, assembled, or modified from the original
manufacturer’s specifications.
A “grey-market vehicle” is one that is manufactured for use outside
of the United States, imported into it, and not certified to meet federal
safety or emissions standards at the time the vehicle was manufactured.
A “salvage vehicle” is one that was declared a total loss by an
insurance carrier and subsequently reconstructed.
Inspection Requirements
Existing law requires the vehicles falling under the four defined
categories to be inspected to determine whether they are properly
equipped and in good mechanical condition before they can be titled
and registered. Under current law, DMV must conduct all of the
inspections. The bill instead requires that inspections of (1) altered, 2024SB-00183-R000310-BA.DOCX
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composite, and grey-market vehicles be performed at DMV (at an office
the commissioner designates) and (2) salvage vehicles be performed by
DMV-authorized licensed repairers.
The bill also eliminates a requirement that DMV determine whether
vehicles presented for inspection are in the possession of their lawful
owner. But it retains a provision authorizing the commissioner to
require someone presenting an altered, composite, grey-market, or
salvage vehicle for inspection to show proof of lawful purchase of any
major component parts that were not part of the vehicle when sold by
the manufacturer.
EFFECTIVE DATE: July 1, 2024
§§ 11-32 — MINOR AND TECHNICAL CHANGES
Makes numerous minor and technical changes, principally to change references to
“commercial driver’s instruction permit” to “commercial learner’s permit,” conforming to
the term used in federal law
The bill makes numerous minor and technical changes. It updates
school bus terms to eliminate references to Type I and Type II school
buses and instead refer to them by gross vehicle weight rating. It also
updates an obsolete reference to the former Department of Public Safety.
The bill also changes references to “commercial driver’s instruction
permit” to “commercial learner’s permit,” conforming to the term used
in federal law. It specifies that commercial driver’s instruction permits
DMV issued before October 1, 2024, remain valid until they expire.
EFFECTIVE DATE: October 1, 2024, except for the provisions
updating school bus terms and replacing an obsolete reference, which
take effect July 1, 2024.
BACKGROUND
Surety Bonds
A surety bond is an agreement between three parties—the principal
(e.g., business owner), the surety (guarantor), and the obligee (e.g., the
government)—that guarantees the principal will fulfill their obligations.
Bond premiums are generally a percentage of the bond’s value and vary 2024SB-00183-R000310-BA.DOCX
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based on risk-related factors such as credit score and experience.
Infractions
Infractions are punishable by fines, usually set by Superior Court
judges, of between $35 and $90, plus a $20 or $35 surcharge and an
additional fee based on the amount of the fine. There may be other
added charges depending upon the type of infraction. For example,
certain motor vehicle infractions trigger a Special Transportation Fund
surcharge of 50% of the fine. With the various additional charges, the
total amount due can be over $300 but often is less than $100. An
infraction is not a crime, and violators can pay the fine by mail without
making a court appearance.
COMMITTEE ACTION
Transportation Committee
Joint Favorable Substitute
Yea 35 Nay 0 (03/20/2024)