81R3043 BEF-F
By: Carona S.B. No. 1095
A BILL TO BE ENTITLED
AN ACT
relating to the licensing and regulation of used automotive parts
recyclers; providing penalties.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Section 2302.001(6), Occupations Code, is
amended to read as follows:
(6) "Salvage vehicle agent" means a person who
acquires, sells, or otherwise deals in nonrepairable or salvage
motor vehicles or used parts in this state as directed by the
salvage vehicle dealer under whose license the person operates.
The term does not include a person who:
(A) is a licensed salvage vehicle dealer or a
licensed used automotive parts recycler;
(B) is a partner, owner, or officer of a business
entity that holds a salvage vehicle dealer license or a used
automotive parts recycler license;
(C) is an employee of a licensed salvage vehicle
dealer or a licensed used automotive parts recycler; or
(D) only transports salvage motor vehicles for a
licensed salvage vehicle dealer or a licensed used automotive parts
recycler.
SECTION 2. Subchapter A, Chapter 2302, Occupations Code, is
amended by adding Section 2302.008 to read as follows:
Sec. 2302.008. APPLICABILITY OF CHAPTER TO USED AUTOMOTIVE
PARTS RECYCLERS. This chapter does not apply to a used automotive
parts recycler licensed under Chapter 2309.
SECTION 3. Section 2302.103(b), Occupations Code, is
amended to read as follows:
(b) An applicant may apply for a salvage vehicle dealer
license with an endorsement in one or more of the following
classifications:
(1) new automobile dealer;
(2) used automobile dealer;
(3) [used vehicle parts dealer;
[(4)] salvage pool operator;
(4) [(5)] salvage vehicle broker; or
(5) [(6)] salvage vehicle rebuilder.
SECTION 4. Subtitle A, Title 14, Occupations Code, is
amended by adding Chapter 2309 to read as follows:
CHAPTER 2309. USED AUTOMOTIVE PARTS RECYCLERS
SUBCHAPTER A. GENERAL PROVISIONS
Sec. 2309.001. SHORT TITLE. This chapter may be cited as
the Texas Used Automotive Parts Recycling Act.
Sec. 2309.002. DEFINITIONS. In this chapter:
(1) "Insurance company," "metal recycler," "motor
vehicle," "nonrepairable motor vehicle," "nonrepairable vehicle
title," "salvage motor vehicle," "salvage vehicle title," and
"salvage vehicle dealer" have the meanings assigned by Section
501.091, Transportation Code.
(2) "Commission" means the Texas Commission of
Licensing and Regulation.
(3) "Department" means the Texas Department of
Licensing and Regulation.
(4) "Executive director" means the executive director
of the department.
(5) "Used automotive part" has the meaning assigned to
"used part" by Section 501.091, Transportation Code.
(6) "Used automotive parts recycler" means a person
licensed under this chapter to operate a used automotive parts
recycling business.
(7) "Used automotive parts recycling" means the
dismantling and reuse or resale of used automotive parts and the
safe disposal of salvage motor vehicles or nonrepairable motor
vehicles, including the resale of those vehicles.
Sec. 2309.003. APPLICABILITY OF CHAPTER TO METAL RECYCLERS.
(a) Except as provided by Subsection (b), this chapter does not
apply to a transaction to which a metal recycler is a party.
(b) This chapter applies to a transaction in which a motor
vehicle:
(1) is sold, transferred, released, or delivered to a
metal recycler as a source of used automotive parts; and
(2) is used as a source of used automotive parts.
Sec. 2309.004. APPLICABILITY OF CHAPTER TO SALVAGE VEHICLE
DEALERS. (a) Except as provided by Subsection (b), this chapter
does not apply to a transaction in which a salvage vehicle dealer is
a party.
(b) This chapter applies to a transaction in which a motor
vehicle:
(1) is sold, transferred, released, or delivered to a
salvage vehicle dealer as a source of used automotive parts; and
(2) is used as a source of used automotive parts.
Sec. 2309.005. APPLICABILITY OF CHAPTER TO INSURANCE
COMPANIES. This chapter does not apply to an insurance company.
[Sections 2309.006-2309.050 reserved for expansion]
SUBCHAPTER B. ADVISORY BOARD
Sec. 2309.051. USED AUTOMOTIVE PARTS RECYCLING ADVISORY
BOARD. (a) The advisory board consists of six members representing
the used automotive parts industry in this state appointed by the
presiding officer of the commission with the approval of the
commission.
(b) The advisory board shall include members who represent
used automotive parts businesses owned by domestic entities, as
defined by Section 1.002, Business Organizations Code.
(c) The advisory board shall include one member who
represents a used automotive parts business owned by a foreign
entity, as defined by Section 1.002, Business Organizations Code.
(d) Appointments to the advisory board shall be made without
regard to the race, color, disability, sex, religion, age, or
national origin of the appointee.
Sec. 2309.052. TERMS; VACANCIES. (a) Advisory board
members serve terms of six years, with the terms of two members
expiring on February 1 of each odd-numbered year.
(b) A member may not serve more than two full consecutive
terms.
(c) If a vacancy occurs during a term, the presiding officer
of the commission shall appoint a replacement who meets the
qualifications of the vacated position to serve for the remainder
of the term.
Sec. 2309.053. PRESIDING OFFICER. The presiding officer of
the commission shall appoint one of the advisory board members to
serve as presiding officer of the advisory board for a term of one
year. The presiding officer of the advisory board may vote on any
matter before the advisory board.
Sec. 2309.054. POWERS AND DUTIES OF ADVISORY BOARD. The
advisory board shall provide advice and recommendations to the
department on technical matters relevant to the administration and
enforcement of this chapter, including licensing standards,
continuing education requirements, and examination content, if
applicable.
Sec. 2309.055. COMPENSATION; REIMBURSEMENT OF EXPENSES.
Advisory board members may not receive compensation but are
entitled to reimbursement for actual and necessary expenses
incurred in performing the functions of the advisory board, subject
to the General Appropriations Act.
Sec. 2309.056. MEETINGS. The advisory board shall meet
twice annually and may meet at other times at the call of the
presiding officer of the commission or the executive director.
[Sections 2309.057-2309.100 reserved for expansion]
SUBCHAPTER C. POWERS AND DUTIES OF COMMISSION AND DEPARTMENT
Sec. 2309.101. GENERAL POWERS AND DUTIES. The executive
director or commission, as appropriate, may take action as
necessary to administer and enforce this chapter.
Sec. 2309.102. RULES. (a) The commission shall adopt
rules for licensing used automotive parts recyclers.
(b) The commission by rule shall adopt standards of conduct
for license holders under this chapter.
Sec. 2309.103. EXAMINATION OF CRIMINAL CONVICTION. The
department may conduct an examination of any criminal conviction of
an applicant, including by obtaining any criminal history record
information permitted by law.
Sec. 2309.104. FEES. The commission shall establish and
collect reasonable and necessary fees in amounts sufficient to
cover the costs of administering this chapter.
Sec. 2309.105. RULES RESTRICTING ADVERTISING OR
COMPETITIVE BIDDING. (a) The commission may not adopt a rule
restricting advertising or competitive bidding by a person who
holds a license issued under this chapter except to prohibit false,
misleading, or deceptive practices by the person.
(b) The commission may not include in its rules to prohibit
false, misleading, or deceptive practices a rule that:
(1) restricts the use of any advertising medium;
(2) restricts the person's personal appearance or use
of the person's voice in an advertisement;
(3) relates to the size or duration of an
advertisement by the person; or
(4) restricts the use of a trade name in advertising by
the person.
Sec. 2309.106. PERIODIC AND RISK-BASED INSPECTIONS. (a)
The department may enter and inspect at any time during business
hours:
(1) the place of business of any person regulated
under this chapter; or
(2) any place in which the department has reasonable
cause to believe that a license holder is in violation of this
chapter or in violation of a rule or order of the commission or
executive director.
(b) The department shall conduct additional inspections
based on a schedule of risk-based inspections using the following
criteria:
(1) the type and nature of the used automotive parts
recycler;
(2) the inspection history;
(3) any history of complaints involving a used
automotive parts recycler; and
(4) any other factor determined by the commission by
rule.
(c) A used automotive parts recycler shall pay a fee for
each risk-based inspection performed under this section. The
commission by rule shall set the amount of the fee.
(d) In conducting an inspection under this section, the
department may inspect a facility, a used automotive part, a
business record, or any other place or thing reasonably required to
enforce this chapter or a rule or order adopted under this chapter.
Sec. 2309.107. PERSONNEL. The department may employ
personnel necessary to administer and enforce this chapter.
[Sections 2309.108-2309.150 reserved for expansion]
SUBCHAPTER D. LICENSE REQUIREMENTS
Sec. 2309.151. LICENSE REQUIRED. Unless the person holds
an appropriate license issued under this chapter, a person may not
own or operate a used automotive parts recycling business or sell
used automotive parts.
Sec. 2309.152. GENERAL LICENSE APPLICATION REQUIREMENTS.
An applicant for a license under this chapter must submit to the
department:
(1) a completed application on a form prescribed by
the executive director;
(2) the required fees; and
(3) any other information required by commission rule.
Sec. 2309.153. LICENSE REQUIREMENTS. An applicant for a
license under this chapter must:
(1) establish proof of financial responsibility in the
manner prescribed by the executive director;
(2) provide proof of ownership or lease of the
property where the applicant will operate a used automotive parts
recycling facility; and
(3) provide a storm water permit if the applicant is
required by the Texas Commission on Environmental Quality to obtain
a permit.
Sec. 2309.154. NONTRANSFERABILITY OF LICENSE. A license
issued by the executive director is valid throughout this state and
is not transferable.
Sec. 2309.155. CONTINUING EDUCATION. (a) The commission by
rule shall recognize or prepare and administer continuing education
programs for license holders. Each license holder must complete a
continuing education program before the license holder may renew
the license holder's license.
(b) A person recognized by the commission to offer a
continuing education program must:
(1) register with the department; and
(2) comply with rules adopted by the commission
relating to continuing education.
Sec. 2309.156. LICENSE RENEWAL. (a) A license issued under
this chapter is valid for one year. The department may adopt a
system under which licenses expire at different times during the
year.
(b) The department shall notify the license holder at least
30 days before the date a license expires. The notice must be in
writing and sent to the license holder's last known address
according to the records of the department.
(c) A license holder may renew a license issued under this
chapter by:
(1) paying a renewal fee;
(2) providing to the department evidence of financial
responsibility;
(3) providing proof of ownership or lease of the
property where the license holder operates a used automotive parts
recycling facility;
(4) providing a storm water permit if the license
holder is required by the Texas Commission on Environmental Quality
to obtain a permit; and
(5) completing continuing education as required by
Section 2309.155.
[Sections 2309.157-2309.200 reserved for expansion]
SUBCHAPTER E. LOCAL REGULATION
Sec. 2309.201. APPLICABILITY OF CERTAIN MUNICIPAL
ORDINANCES, LICENSES, AND PERMITS. (a) The requirements of this
chapter apply in addition to the requirements of any applicable
municipal ordinance relating to the regulation of a person who
deals in nonrepairable or salvage motor vehicles or used automotive
parts.
(b) This chapter does not prohibit the enforcement of an
applicable municipal license or permit requirement that is related
to an activity regulated under this chapter.
[Sections 2309.202-2309.250 reserved for expansion]
SUBCHAPTER F. ENFORCEMENT
Sec. 2309.251. ADMINISTRATIVE PENALTY. (a) The commission
may impose an administrative penalty on a person under Subchapter
F, Chapter 51, regardless of whether the person holds a license
under this chapter, if the person violates:
(1) this chapter or a rule adopted under this chapter;
or
(2) a rule or order of the executive director or
commission.
(b) An administrative penalty may not be imposed unless the
person charged with a violation is provided the opportunity for a
hearing.
Sec. 2309.252. CEASE AND DESIST ORDER; INJUNCTION; CIVIL
PENALTY. (a) The executive director may issue a cease and desist
order as necessary to enforce this chapter if the executive
director determines that the action is necessary to prevent a
violation of this chapter and to protect public health and safety.
(b) The attorney general or executive director may
institute an action for an injunction or a civil penalty under this
chapter as provided by Section 51.352.
Sec. 2309.253. SANCTIONS. The department may impose
sanctions as provided by Section 51.353.
Sec. 2309.254. CRIMINAL PENALTY; LICENSING. (a) A person
commits an offense if the person:
(1) violates the licensing requirements of this
chapter;
(2) deals in used parts without a license; or
(3) employs an individual who does not hold the
appropriate license required by this chapter.
(b) An offense under this section is a Class C misdemeanor.
[Sections 2309.255-2309.300 reserved for expansion]
SUBCHAPTER G. CONDUCTING BUSINESS
Sec. 2309.301. DUTIES ON ACQUISITION OF SALVAGE MOTOR
VEHICLE. (a) A used automotive parts recycler who acquires
ownership of a salvage motor vehicle shall obtain a properly
assigned title from the previous owner of the vehicle.
(b) A used automotive parts recycler who acquires ownership
of a motor vehicle, nonrepairable motor vehicle, or salvage motor
vehicle for the purpose of dismantling, scrapping, or destroying
the motor vehicle, shall, before the 61st day after the date of
acquiring the motor vehicle, submit to the Texas Department of
Transportation a report stating that the motor vehicle will be
dismantled, scrapped, or destroyed. The recycler shall:
(1) submit the report on a form prescribed by the Texas
Department of Transportation; and
(2) submit with the report a properly assigned
manufacturer's certificate of origin, regular certificate of
title, nonrepairable vehicle title, salvage vehicle title, or
comparable out-of-state ownership document for the motor vehicle.
(c) After receiving the report and title or document, the
Texas Department of Transportation shall issue the used automotive
parts recycler a receipt for the manufacturer's certificate of
origin, regular certificate of title, nonrepairable vehicle title,
salvage vehicle title, or comparable out-of-state ownership
document.
(d) The recycler shall comply with Subchapter E, Chapter
501, Transportation Code.
Sec. 2309.302. RECORDS OF PURCHASES. A used automotive
parts recycler shall maintain a record of each motor vehicle,
salvage motor vehicle, nonrepairable motor vehicle, and used
automotive part purchased.
Sec. 2309.303. REGISTRATION OF NEW BUSINESS LOCATION.
Before moving a place of business or opening an additional place of
business, a used automotive parts recycler must notify the
department of the new location. The used automotive parts recycler
shall provide a storm water permit for the location if a permit is
required by the Texas Commission on Environmental Quality.
[Sections 2309.304-2309.350 reserved for expansion]
SUBCHAPTER H. ADDITIONAL DUTIES OF USED AUTOMOTIVE PARTS RECYCLER
IN CONNECTION WITH MOTOR VEHICLE COMPONENT PARTS
Sec. 2309.351. DEFINITIONS. In this subchapter:
(1) "Component part" means a major component part as
defined by Section 501.091, Transportation Code, or a minor
component part.
(2) "Interior component part" means a motor vehicle's
seat or radio.
(3) "Minor component part" means an interior component
part, a special accessory part, or a motor vehicle part that
displays or should display at least one of the following:
(A) a federal safety certificate;
(B) a motor number;
(C) a serial number or a derivative; or
(D) a manufacturer's permanent vehicle
identification number or a derivative.
(4) "Special accessory part" means a motor vehicle's
tire, wheel, tailgate, or removable glass top.
Sec. 2309.352. REMOVAL OF LICENSE PLATES. Immediately on
receipt of a motor vehicle, a used automotive parts recycler shall:
(1) remove any unexpired license plates from the
vehicle; and
(2) place the license plates in a secure place until
destroyed by the used automotive parts recycler.
Sec. 2309.353. RECEIPT OF MOTOR VEHICLE. A used automotive
parts recycler may not take delivery of a motor vehicle unless the
recycler first obtains:
(1) a certificate of authority to dispose of the
vehicle, a sales receipt, or a transfer document for the vehicle
issued under Chapter 683, Transportation Code; or
(2) a certificate of title showing that there are no
liens on the vehicle or that all recorded liens have been released.
Sec. 2309.354. RECORD OF PURCHASE; INVENTORY OF PARTS. (a)
A used automotive parts recycler shall keep an accurate and legible
inventory of each used component part purchased by or delivered to
the recycler. The inventory must contain a record of each part
that includes:
(1) the date of purchase or delivery;
(2) the driver's license number of the seller and a
legible photocopy of the seller's driver's license;
(3) the license plate number of the motor vehicle in
which the part was delivered;
(4) a complete description of the part and, if
applicable, the make, model, color, and size of the part; and
(5) the vehicle identification number of the motor
vehicle from which the part was removed.
(b) As an alternative to the information required by
Subsection (a), a used automotive parts recycler may record:
(1) the name of the person who sold the part or the
motor vehicle from which the part was obtained; and
(2) the Texas certificate of inventory number or the
federal taxpayer identification number of the person.
(c) The department shall prescribe the form of the record
required by Subsection (a) and shall make the form available to used
automotive parts recyclers.
(d) This section does not apply to:
(1) an interior component part or special accessory
part from a motor vehicle more than 10 years old; or
(2) a part delivered to a used automotive parts
recycler by a commercial freight line, commercial carrier, or
licensed used automotive parts recycler.
Sec. 2309.355. ASSIGNMENT OF INVENTORY NUMBER. (a) A used
automotive parts recycler shall:
(1) assign a unique inventory number to each
transaction in which the recycler purchases or takes delivery of a
component part;
(2) attach that inventory number to each component
part the recycler obtains in the transaction; and
(3) retain each component part in its original
condition on the business premises of the recycler for at least
three calendar days, excluding Sundays, after the date the
recycler obtains the part.
(b) An inventory number attached to a component part under
Subsection (a) may not be removed while the part remains in the
inventory of the used automotive parts recycler.
(c) This section does not apply to the purchase by a used
automotive parts recycler of a nonoperational engine,
transmission, or rear axle assembly from another used automotive
parts recycler or an automotive-related business.
Sec. 2309.356. MAINTENANCE OF RECORDS. A used automotive
parts recycler shall keep a record required under this subchapter
on a form prescribed by the department or the Texas Department of
Transportation. The recycler shall maintain copies of each record
required under this subchapter until the first anniversary of the
purchase date of the item for which the record is maintained.
Sec. 2309.357. SURRENDER OF CERTAIN DOCUMENTS OR LICENSE
PLATES. (a) On demand, a used automotive parts recycler shall
surrender to the Texas Department of Transportation for
cancellation a certificate of title or authority, sales receipt or
transfer document, license plate, or inventory list that the
recycler is required to possess or maintain.
(b) The Texas Department of Transportation shall provide a
signed receipt for a surrendered certificate of title.
Sec. 2309.358. RESALE OF SALVAGE MOTOR VEHICLES OR
NONREPAIRABLE MOTOR VEHICLES. (a) A used automotive parts
recycler may sell salvage or nonrepairable vehicles only at the
recycler's business location.
(b) Before reselling a salvage motor vehicle or
nonrepairable motor vehicle, a used automotive parts recycler must
post notice on the vehicle of the type of title appropriate to the
vehicle.
Sec. 2309.359. INSPECTION OF RECORDS. (a) A peace officer
at any reasonable time may inspect a record required to be
maintained under this subchapter, including an inventory record.
(b) On demand by a peace officer, a used automotive parts
recycler shall provide to the officer a copy of a record required to
be maintained under this subchapter.
(c) A peace officer may inspect the inventory on the
premises of a used automotive parts recycler at any reasonable time
to verify, check, or audit the records required to be maintained
under this subchapter.
(d) A used automotive parts recycler or an employee of the
recycler shall allow and may not interfere with a peace officer's
inspection of the recycler's inventory, premises, or required
inventory records.
[Sections 2309.360-2309.400 reserved for expansion]
SUBCHAPTER I. MOTOR VEHICLE SALVAGE YARDS IN CERTAIN COUNTIES
Sec. 2309.401. APPLICABILITY OF SUBCHAPTER. This
subchapter applies only to a used automotive parts facility located
in a county with a population of 2.8 million or more.
Sec. 2309.402. LIMITS ON OPERATION OF HEAVY MACHINERY. (a)
A used automotive parts recycler may not operate heavy machinery in
a used automotive parts recycling facility between the hours of 7
p.m. of one day and 7 a.m. of the following day.
(b) This section does not apply to conduct necessary to a
sale or purchase by the recycler.
SECTION 5. Section 501.091, Transportation Code, is amended
by amending Subdivision (17) and adding Subdivision (20) to read as
follows:
(17) "Salvage vehicle dealer" means a person engaged
in this state in the business of acquiring, selling, [dismantling,]
repairing, rebuilding, reconstructing, or otherwise dealing in
nonrepairable motor vehicles or [,] salvage motor vehicles[, or
used parts]. The term does not include a person who casually
repairs, rebuilds, or reconstructs fewer than five [three] salvage
motor vehicles in the same calendar year or a person who deals in
used automotive parts. The term includes a person engaged in the
business of:
(A) a salvage vehicle dealer, regardless of
whether the person holds a license issued by the department to
engage in that business; or
(B) dealing in nonrepairable motor vehicles or
salvage motor vehicles[, regardless of whether the person deals in
used parts; or
[(C) dealing in used parts regardless of whether
the person deals in nonrepairable motor vehicles or salvage motor
vehicles].
(20) "Used parts dealer" and "used automotive parts
recycler" have the meaning assigned to "used automotive parts
recycler" by Section 2309.002, Occupations Code.
SECTION 6. Section 501.092(d), Transportation Code, is
amended to read as follows:
(d) An insurance company may sell a motor vehicle to which
this section applies, or assign a salvage vehicle title or a
nonrepairable vehicle title for the motor vehicle, only to a
salvage vehicle dealer, an out-of-state buyer, a buyer in a casual
sale at auction, [or] a metal recycler, or a used automotive parts
recycler. If the motor vehicle is not a salvage motor vehicle or a
nonrepairable motor vehicle, the insurance company is not required
to surrender the regular certificate of title for the vehicle or to
be issued a salvage vehicle title or a nonrepairable vehicle title
for the motor vehicle.
SECTION 7. Sections 501.095(a) and (b), Transportation
Code, are amended to read as follows:
(a) If the department has not issued a nonrepairable vehicle
title or salvage vehicle title for the motor vehicle and an
out-of-state ownership document for the motor vehicle has not been
issued by another state or jurisdiction, a business or governmental
entity described by Subdivisions (1)-(3) may sell, transfer, or
release a nonrepairable motor vehicle or salvage motor vehicle only
to a person who is:
(1) a licensed salvage vehicle dealer, a used
automotive parts recycler under Chapter 2309, Occupations Code, or
a metal recycler under Chapter 2302, Occupations Code;
(2) an insurance company that has paid a claim on the
nonrepairable or salvage motor vehicle;
(3) a governmental entity; or
(4) an out-of-state buyer.
(b) A person, other than a salvage vehicle dealer, a used
automotive parts recycler, or an insurance company licensed to do
business in this state, who acquired ownership of a nonrepairable
or salvage motor vehicle that has not been issued a nonrepairable
vehicle title, salvage vehicle title, or a comparable ownership
document issued by another state or jurisdiction shall, before
selling the motor vehicle, surrender the properly assigned
certificate of title for the motor vehicle to the department and
apply to the department for:
(1) a nonrepairable vehicle title if the vehicle is a
nonrepairable motor vehicle; or
(2) a salvage vehicle title if the vehicle is a salvage
motor vehicle.
SECTION 8. Section 501.105, Transportation Code, is amended
to read as follows:
Sec. 501.105. RETENTION OF RECORDS RELATING TO CERTAIN
CASUAL SALES. Each licensed salvage vehicle dealer, used
automotive parts recycler, or insurance company that sells a
nonrepairable motor vehicle or a salvage motor vehicle at a casual
sale shall keep on the business premises of the dealer or the
insurance company a list of all casual sales made during the
preceding 36-month period that contains:
(1) the date of the sale;
(2) the name of the purchaser;
(3) the name of the jurisdiction that issued the
identification document provided by the purchaser, as shown on the
document; and
(4) the vehicle identification number.
SECTION 9. Section 2302.253, Occupations Code, is repealed.
SECTION 10. Not later than January 1, 2010, the Texas
Commission of Licensing and Regulation shall adopt rules under
Section 2309.102, Occupations Code, as added by this Act.
SECTION 11. (a) Except as provided by Subsection (b) of this
section, this Act takes effect September 1, 2009.
(b) Section 2309.151, Occupations Code, as added by this
Act, and Subchapter F, Chapter 2309, Occupations Code, as added by
this Act, take effect September 1, 2010.