Second Regular Session Sixty-eighth General Assembly STATE OF COLORADO INTRODUCED LLS NO. 12-0358.01 Jery Payne x2157 HOUSE BILL 12-1098 HOUSE SPONSORSHIP Balmer, Liston SENATE SPONSORSHIP Jahn, House Committees Senate Committees Transportation A BILL FOR AN ACT Concerning the sale of motor vehicles that have been damaged to such an extent that the cost of the repairs exceeds the fair market value of the vehicle. Bill Summary (Note: This summary applies to this bill as introduced and does not reflect any amendments that may be subsequently adopted. If this bill passes third reading in the house of introduction, a bill summary that applies to the reengrossed version of this bill will be available at http://www.leg.state.co.us/billsummaries.) Section 2 of the bill prohibits a salvage vehicle pool from selling a salvaged vehicle unless it is sold to a licensed dealer or recycler. Section 3 requires that specific warnings be placed on each certificate of title for a salvage vehicle. A person who fails to obtain a salvage title is subject to punishment of a fine of $10 to $500, imprisonment for 10 days to 6 months, or both. Be it enacted by the General Assembly of the State of Colorado: SECTION 1. In Colorado Revised Statutes, 12-6-102, amend (16.7); add (16.8); and add with relocated provisions (16.9) as follows: 12-6-102. Definitions. As used in this part 1 and in part 5 of this article, unless the context or section 12-6-502 otherwise requires: (16.7) "Site control provision" means an agreement that applies to real property owned or leased by the franchisee and that gives a motor vehicle or powersports vehicle manufacturer, distributor, or manufacturer representative the right to: (a) Control the use and development of the real property; (b) Require the franchisee to establish or maintain an exclusive dealership facility at the real property; or (c) Restrict the franchisee from transferring, selling, leasing, developing, or changing the use of the real property "Salvage vehicle dealer" means a motor vehicle dealer or used motor vehicle dealer who acquires damaged motor vehicles or recovered stolen motor vehicles for the purpose of reselling the vehicles or parts of the vehicles. (16.8) "Salvage vehicle pool" means a person engaged in the business of selling, transferring, or disposing of total loss, salvage, or damaged motor vehicles or recovered stolen motor vehicles on behalf of owners, insurance companies, authorized adjustors, leasing companies, self-insured persons, or financial institutions. (16.9) [Formerly (16.7)] "Site control provision" means an agreement that applies to real property owned or leased by the franchisee and that gives a motor vehicle or powersports vehicle manufacturer, distributor, or manufacturer representative the right to: (a) Control the use and development of the real property; (b) Require the franchisee to establish or maintain an exclusive dealership facility at the real property; or (c) Restrict the franchisee from transferring, selling, leasing, developing, or changing the use of the real property. SECTION 2. In Colorado Revised Statutes, add 12-6-120.1 as follows: 12-6-120.1. Salvage vehicle pools. A salvage vehicle pool shall not sell a salvaged motor vehicle unless the buyer is a salvage vehicle dealer, person licensed under this article, or an automotive recycler licensed or permitted under a municipal ordinance. SECTION 3. In Colorado Revised Statutes, 42-6-136, amend (3) (a) as follows: 42-6-136. Surrender and cancellation of certificate - penalty for violation. (3) (a) (I) An owner of a salvage motor vehicle that has been made roadworthy who applies for a certificate of title as provided in section 42-6-116 shall include such information regarding the vehicle as the director may require by rule. The owner shall provide to the director evidence of ownership that satisfies the director that the applicant is entitled to filing of a certificate of title. (II) When issuing a salvage title, the director or the authorized agent shall designate in a conspicuous place in the record for a vehicle that it is a salvage vehicle that has been made roadworthy Such designation shall include the words "REBUILT FROM SALVAGE" and shall become a permanent part of the certificate of title for such vehicle and shall appear on all subsequent certificates of title for such vehicle place a stamp containing the following disclaimer on the certificate of title: "SALVAGE VEHICLE NOT FOR RESALE WITHOUT DISCLOSURE. WARNING: A SALVAGE VEHICLE MAY NOT BE SAFE FOR OPERATION, AND SOME STATES PROHIBIT REGISTRATION OF CERTAIN SALVAGE TITLE VEHICLES OR REQUIRE INSPECTIONS BEFORE A VEHICLE MAY BE REGISTERED. SOME STATES MAY REQUIRE THIS VEHICLE TO BE PERMANENTLY BRANDED. MANY INSURANCE COMPANIES WILL NOT INSURE SALVAGE VEHICLES OR MAY DO SO ONLY AT A DIMINISHED VALUE FOR PAYMENT OF A CLAIM." The department shall place the stamp on the front of the certificate of title, centrally aligned immediately above the signature line, in capital letters and in twelve-point, bold-faced, Arial font. (III) A person who sells or transfers a salvage vehicle to another person without obtaining a salvage title in accordance with this section is guilty of a misdemeanor and is subject to a fine of not less than ten dollars nor more than five hundred dollars, by imprisonment in the county jail for not less than ten days nor more than six months, or by both. SECTION 4. Effective date - applicability. This act takes effect July 1, 2012, and applies to offenses committed on or after said date. SECTION 5. Safety clause. The general assembly hereby finds, determines, and declares that this act is necessary for the immediate preservation of the public peace, health, and safety.