S.B. No. 1235
 
 
 
 
AN ACT
  relating to the sale and use of unregistered vehicles, including
  the issuance and use of temporary tags on vehicles.
         BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
         SECTION 1.  Subsection (d), Section 501.022, Transportation
  Code, is amended to read as follows:
         (d)  Subsection (c) does not apply to a motor vehicle
  operated on a public highway in this state with a metal dealer's
  license plate or a dealer's or buyer's temporary [cardboard] tag
  attached to the vehicle as provided by Chapter 503.
         SECTION 2.  Subsections (a) and (c), Section 503.038,
  Transportation Code, are amended to read as follows:
         (a)  The department may cancel a dealer's general
  distinguishing number if the dealer:
               (1)  falsifies or forges a title document, including an
  affidavit making application for a certified copy of a title;
               (2)  files a false or forged tax document, including a
  sales tax affidavit;
               (3)  fails to take assignment of any basic evidence of
  ownership, including a certificate of title or manufacturer's
  certificate, for a vehicle the dealer acquires;
               (4)  fails to assign any basic evidence of ownership,
  including a certificate of title or manufacturer's certificate, for
  a vehicle the dealer sells;
               (5)  uses or permits the use of a metal dealer's license
  plate or a dealer's temporary [cardboard] tag on a vehicle that the
  dealer does not own or control or that is not in stock and offered
  for sale;
               (6)  makes a material misrepresentation in an
  application or other information filed with the department;
               (7)  fails to maintain the qualifications for a general
  distinguishing number;
               (8)  fails to provide to the department within 30 days
  after the date of demand by the department satisfactory and
  reasonable evidence that the person is regularly and actively
  engaged in business as a wholesale or retail dealer;
               (9)  has been licensed for at least 12 months and has
  not assigned at least five vehicles during the previous 12-month
  period;
               (10)  has failed to demonstrate compliance with
  Sections 23.12, 23.121, and 23.122, Tax Code;
               (11)  uses or allows the use of the dealer's general
  distinguishing number or the location for which the general
  distinguishing number is issued to avoid the requirements of this
  chapter;
               (12)  misuses or allows the misuse of a temporary
  [cardboard] tag authorized under this chapter;
               (13)  refuses to show on a buyer's temporary
  [cardboard] tag the date of sale or other reasonable information
  required by the department; or
               (14)  otherwise violates this chapter or a rule adopted
  under this chapter.
         (c)  A person whose general distinguishing number is
  canceled under this chapter shall surrender to a representative of
  the department each license, license plate, temporary [cardboard]
  tag, sticker, and receipt issued under this chapter not later than
  the 10th day after the date the general distinguishing number is
  canceled. The department shall direct any peace officer to secure
  and return to the department any plate, tag, sticker, or receipt of
  a person who does not comply with this subsection.
         SECTION 3.  The heading to Section 503.062, Transportation
  Code, is amended to read as follows:
         Sec. 503.062.  DEALER'S TEMPORARY [CARDBOARD] TAGS.
         SECTION 4.  Subsections (a), (b), and (d), Section 503.062,
  Transportation Code, are amended to read as follows:
         (a)  A dealer may issue a temporary [cardboard] tag for use
  on an unregistered vehicle by the dealer or the dealer's employees
  only to:
               (1)  demonstrate or cause to be demonstrated to a
  prospective buyer the vehicle for sale purposes only;
               (2)  convey or cause to be conveyed the vehicle:
                     (A)  from one of the dealer's places of business
  in this state to another of the dealer's places of business in this
  state;
                     (B)  from the dealer's place of business to a
  place the vehicle is to be repaired, reconditioned, or serviced;
                     (C)  from the state line or a location in this
  state where the vehicle is unloaded to the dealer's place of
  business;
                     (D)  from the dealer's place of business to a
  place of business of another dealer;
                     (E)  from the point of purchase by the dealer to
  the dealer's place of business; or
                     (F)  to road test the vehicle; or
               (3)  use the vehicle for or allow its use by a
  charitable organization.
         (b)  Subsection (a)(1) does not prohibit a dealer from
  permitting:
               (1)  a prospective buyer to operate a vehicle while the
  vehicle is being demonstrated; or
               (2)  a customer to operate a vehicle temporarily while
  the customer's vehicle is being repaired.
         (d)  The department may not issue a dealer temporary
  [cardboard] tag or contract for the issuance of a dealer temporary
  [cardboard] tag but shall prescribe:
               (1)  the specifications, form, and color of a dealer
  temporary [cardboard] tag;
               (2)  procedures for a dealer to generate a
  vehicle-specific number using the database developed under Section
  503.0626 and assign it to each tag;
               (3)  procedures to clearly display the
  vehicle-specific number on the tag; and
               (4)  the period for which a tag may be used for or by a
  charitable organization.
         SECTION 5.  The heading to Section 503.0625, Transportation
  Code, is amended to read as follows:
         Sec. 503.0625.  CONVERTER'S TEMPORARY [CARDBOARD] TAGS.
         SECTION 6.  Subsections (b), (e), and (f), Section 503.0625,
  Transportation Code, are amended to read as follows:
         (b)  A converter may issue a temporary [cardboard] tag for
  use on an unregistered vehicle by the converter or the converter's
  employees only to:
               (1)  demonstrate or cause to be demonstrated to a
  prospective buyer who is an employee of a franchised motor vehicle
  dealer the vehicle; or
               (2)  convey or cause to be conveyed the vehicle:
                     (A)  from one of the converter's places of
  business in this state to another of the converter's places of
  business in this state;
                     (B)  from the converter's place of business to a
  place the vehicle is to be assembled, repaired, reconditioned,
  modified, or serviced;
                     (C)  from the state line or a location in this
  state where the vehicle is unloaded to the converter's place of
  business;
                     (D)  from the converter's place of business to a
  place of business of a franchised motor vehicle dealer; or
                     (E)  to road test the vehicle.
         (e)  The department may not issue a converter temporary
  [cardboard] tag or contract for the issuance of a converter
  temporary [cardboard] tag but shall prescribe:
               (1)  the specifications, form, and color of a converter
  temporary [cardboard] tag;
               (2)  procedures for a converter to generate a
  vehicle-specific number using the database developed under Section
  503.0626 and assign it to each tag; and
               (3)  procedures to clearly display the
  vehicle-specific number on the tag.
         (f)  A converter or employee of a converter may not use a
  temporary [cardboard] tag issued under this section as
  authorization to operate a vehicle for the converter's or the
  employee's personal use.
         SECTION 7.  Subsections (a) and (c), Section 503.0626,
  Transportation Code, are amended to read as follows:
         (a)  The department shall develop and maintain a secure,
  real-time database of information on vehicles to which dealers and
  converters have affixed temporary [cardboard] tags. The database
  shall be managed by the vehicle titles and registration division of
  the department.
         (c)  Before a dealer's or converter's temporary [cardboard]
  tag may be displayed on a vehicle, the dealer or converter must
  enter into the database through the Internet information on the
  vehicle and information about the dealer or converter as prescribed
  by the department. The department may not deny access to the
  database to any dealer who holds a general distinguishing number
  issued under this chapter or who is licensed under Chapter 2301,
  Occupations Code, or to any converter licensed under Chapter 2301,
  Occupations Code.
         SECTION 8.  The heading to Section 503.063, Transportation
  Code, is amended to read as follows:
         Sec. 503.063.  BUYER'S TEMPORARY [CARDBOARD] TAGS.
         SECTION 9.  Subsections (a), (b), (g), and (h), Section
  503.063, Transportation Code, are amended to read as follows:
         (a)  Except as provided by this section, a dealer shall issue
  to a person who buys a vehicle one temporary [cardboard] buyer's tag
  for the vehicle.
         (b)  Except as provided by this section, the buyer's tag is
  valid for the operation of the vehicle until the earlier of:
               (1)  the date on which the vehicle is registered; or
               (2)  the 60th [21st] day after the date of purchase.
         (g)  [Using the same vehicle-specific number generated under
  Subsection (e)(2)(A), a dealer may issue an additional temporary
  cardboard buyer's tag to a person after the expiration of 20 working
  days after the issue of a temporary cardboard buyer's tag, and the
  person may operate the vehicle for which the tag was issued on the
  additional temporary cardboard buyer's tag if the dealer has been
  unable to obtain on behalf of the vehicle's owner the necessary
  documents to obtain permanent metal license plates because the
  documents are in the possession of a lienholder who has not complied
  with the terms of Section 501.115(a). An additional tag issued
  under the terms of this subsection is valid for a maximum of 20
  working days after the date of issue.
         [(h)]  For each buyer's temporary [cardboard] tag [other
  than an additional temporary cardboard buyer's tag under Subsection
  (g)], a dealer shall charge the buyer a registration fee of not more
  than $5 as prescribed by the department to be sent to the
  comptroller for deposit to the credit of the state highway fund.
         SECTION 10.  Subsection (c), Section 503.0631,
  Transportation Code, is amended to read as follows:
         (c)  Except as provided by Subsection (d), before a buyer's
  temporary [cardboard] tag may be displayed on a vehicle, a dealer
  must enter into the database through the Internet information about
  the buyer of the vehicle for which the tag was issued as prescribed
  by the department and generate a vehicle-specific number for the
  tag as required by Section 503.063(e). The department may not deny
  access to the database to any dealer who holds a general
  distinguishing number issued under this chapter or who is licensed
  under Chapter 2301, Occupations Code.
         SECTION 11.  Subsection (a), Section 503.065,
  Transportation Code, is amended to read as follows: 
         (a)  The department may issue or cause to be issued to a
  person a temporary license plate [made of cardboard or similar
  material] authorizing the person to operate a new unregistered
  vehicle on a public highway of this state if the person:
               (1)  buys the vehicle from a dealer outside this state
  and intends to drive the vehicle from the dealer's place of
  business; or
               (2)  buys the vehicle from a dealer in this state but
  intends to drive the vehicle from the manufacturer's place of
  business outside this state.
         SECTION 12.  Section 503.067, Transportation Code, is
  amended to read as follows:
         Sec. 503.067.  UNAUTHORIZED REPRODUCTION, PURCHASE, USE, OR
  SALE OF TEMPORARY [CARDBOARD] TAGS. (a)  A person may not produce
  or reproduce a temporary [cardboard] tag or an item represented to
  be a temporary [cardboard] tag for the purpose of distributing the
  tag to someone other than a dealer or converter.
         (b)  A person may not operate a vehicle that displays an
  unauthorized temporary [cardboard] tag.
         (c)  A person other than a dealer or converter may not
  purchase a temporary [cardboard] tag.
         (d)  A person may not sell or distribute a temporary
  [cardboard] tag or an item represented to be a temporary
  [cardboard] tag unless the person is:
               (1)  a dealer issuing the tag in connection with the
  sale of a vehicle; or
               (2)  a printer or distributor engaged in the business
  of selling temporary [cardboard] tags solely for uses authorized
  under this chapter.
         SECTION 13.  Subsections (a), (b), and (c), Section 503.068,
  Transportation Code, are amended to read as follows:
         (a)  A dealer or an employee of a dealer may not use a
  dealer's temporary [cardboard] tag as authorization to operate a
  vehicle for the dealer's or the employee's personal use.
         (b)  A person may not use a metal dealer's license plate or
  dealer's temporary [cardboard] tag on:
               (1)  a service or work vehicle; or
               (2)  a commercial vehicle that is carrying a load.
         (c)  For purposes of this section, a boat trailer carrying a
  boat is not a commercial vehicle carrying a load. A dealer
  complying with this chapter may affix to the rear of a boat trailer
  the dealer owns or sells a metal dealer's license plate or temporary
  [cardboard] tag issued under Section 503.061, 503.062, or 503.063.
         SECTION 14.  Subsection (a), Section 503.069,
  Transportation Code, is amended to read as follows:
         (a)  A license plate, other than an in-transit license plate,
  or a temporary [cardboard] tag issued under this chapter shall be
  displayed in accordance with commission [board] rules.
         SECTION 15.  Subdivision (12), Section 601.002,
  Transportation Code, is amended to read as follows:
               (12)  "Vehicle registration" means:
                     (A)  a registration certificate, registration
  receipt, or number plate issued under Chapter 502; or
                     (B)  a dealer's license plate or temporary
  [cardboard] tag issued under Chapter 503.
         SECTION 16.  Subsection (a), Section 152.069, Tax Code, is
  amended to read as follows:
         (a)  The seller of a motor vehicle sold in a seller-financed
  sale shall apply for the registration of, and a Texas certificate of
  title for, the motor vehicle in the name of the purchaser to the
  appropriate county tax assessor-collector not later than the 45th
  day after the date the motor vehicle is delivered to the purchaser.
         SECTION 17.  Section 503.0632, Transportation Code, is
  repealed.
         SECTION 18.  The changes in law made by this Act to Section
  503.067, Transportation Code, apply to an offense committed on or
  after the effective date of this Act. An offense committed before
  the effective date of this Act is governed by the law in effect when
  the offense was committed, and the former law is continued in effect
  for that purpose. For purposes of this section, an offense was
  committed before the effective date of this Act if any element of
  the offense was committed before that date.
         SECTION 19.  This Act takes effect September 1, 2009.
 
 
 
 
 
  ______________________________ ______________________________
     President of the Senate Speaker of the House     
 
         I hereby certify that S.B. No. 1235 passed the Senate on
  April 9, 2009, by the following vote: Yeas 31, Nays 0; and that
  the Senate concurred in House amendment on May 29, 2009, by the
  following vote: Yeas 30, Nays 0.
 
 
  ______________________________
  Secretary of the Senate    
 
         I hereby certify that S.B. No. 1235 passed the House, with
  amendment, on May 26, 2009, by the following vote: Yeas 94,
  Nays 53, one present not voting.
 
 
  ______________________________
  Chief Clerk of the House   
 
 
 
  Approved:
 
  ______________________________ 
              Date
 
 
  ______________________________ 
            Governor