INTRODUCTION. The Texas Department of Motor Vehicles (department) adopts amendments to 43 TAC §§217.2, 217.4, 217.23, 217.28, 217.36, 217.45, 217.46, and 217.89 concerning titling and registering motor vehicles. The amendments to §§217.4, 217.23, 217.28, 217.45, 217.46, and 217.89 are necessary to implement amended Transportation Code §§501.023, 501.0234, 501.030, 502.040, 502.041, 502.407, 520.006, and 521.144 authorizing registration and title applications to be processed by any county tax assessor-collector willing to accept the application under Senate Bill (SB) 876, 87th Legislature, Regular Session (2021). The amendment to §217.36 is necessary to complete the implementation of Transportation Code §707.20 and §707.21 under House Bill (HB) 1631, 86th Legislature, Regular Session (2019) by removing obsolete references to photographic traffic signal enforcement programs. The amendment to §217.2 removes the term "identification certificate" as a defined term and is nonsubstantive. The department adopts amendments to 43 TAC §§217.2, 217.4, 217.23, 217.28, 217.36, 217.46, and 217.89 without changes to the proposed text as published in the November 12, 2021, issue of the Texas Register (46 TexReg 7762); §§217.2, 217.4, 217.23, 217.28, 217.36, 217.46, and 217.89 will not be republished. The department adopts amendments to 43 TAC §217.45 with changes to the proposed text; §217.45 will be republished. The rules are adopted to be effective March 1, 2022.

REASONED JUSTIFICATION. Senate Bill 876 expands title and registration services beyond those county tax assessor-collectors required to accept a title or registration application in statute to any county tax assessor-collector willing to accept the application. Adopted §§217.4, 217.23, 217.28, 217.45, 217.46, and 217.89 address the expansion by adding a reference to "a county tax assessor-collector who is willing to accept the application" to those existing sections that specified a county tax assessor-collector. Sections that did not specify a county tax assessor-collector or just the process have not been amended.

The department met with the Customer Service Advisory Committee twice in considering this adoption. The department appreciates the committee members' serious consideration of the issues presented by SB 876 and the members' comments.

Implementation of SB 876 also involves significant programming modifications to the department's Registration and Title System (RTS) to enable the routine processing of out-of-county applications and the distribution of fees as specified in amended Transportation Code §520.006, which applies if a willing county tax assessor-collector is collecting fees and processing the application on behalf of a county tax assessor-collector who is designated by statute to process the application.

The following paragraphs address the amendments in this adoption.

The amendment to §217.2 removes the term "identification certificate" as a defined term and redesignates the following definitions accordingly. The term is never used alone as a defined term. The term is used in multiple sections of Chapter 217. It usually refers to a document that is then described as a form of personal identification such as a driver's license or identification card, but not in a consistent manner. In §217.4 and §217.89, the term is used and then described similarly to its defined use in §217.2, as relating to a vehicle inspection under Transportation Code Chapter 548 and §501.030. Chapter 548 refers to the document as a "vehicle inspection report." As such, the term is unnecessary as a defined term because each use redefines the term.

The amendment to §217.4(b)(1) removes the statement "as selected by the applicant." In this section, the term "applicant" refers to the owner or purchaser of the vehicle. The change conforms the section with SB 876, which repeals Transportation Code §501.023(e) and §501.0234(e), which required the purchaser to choose the county the title application was to be filed in. The amendment to §217.4(b)(2) conforms the section with the SB 876 any willing county amendment to Transportation Code §501.023(a). The amendment to §217.4(c)(4) removes the requirement for the applicant to provide the seller's mailing address, which is not required in statute or on the applicable department form. The amendment to §217.4(d)(4) replaces the term "identification certificate" with "vehicle inspection report" based on the reasons addressed in the prior discussion of the amendment to §217.2.

The amendments to §217.23(c) and (d) are necessary to conform the section with the SB 876 any willing county amendment to Transportation Code §502.040 and §502.041.

The amendments to §217.28(a) and (c) are necessary to conform the section with the SB 876 any willing county amendment to Transportation Code §502.041. The department has added the term "of the county" to §217.28(c) to clarify the subsection to read "An initial application for registration must be filed with the tax assessor-collector of the county in which the owner resides or any county tax assessor-collector who is willing to accept the application, except as provided in subsection (d) of this section." The amendment also adds new §217.28(f) to create a definition of a closed county by rule for purposes of Transportation Code §502.407(c), as required by SB 876. Adopted §217.28(f) is based on the prior closed definition in §217.4(b)(2), which is being amended as previously discussed in this adoption to conform §217.4 to Transportation Code §501.023 as amended by SB 876. The amendment to §217.28(e)(5) replaces the existing sentence, because proration is covered in §217.45(d)(2). Additionally, the department adopts nonsubstantive amendments to §217.28(b), (c), and (d) to conform to current statutory references by replacing the term "license plate" with the term registration and otherwise referring to "registration renewal notice" and clarifying that an applicant may also renew a vehicle registration via the internet without a registration renewal notice.

The amendments to §217.36(b) and (d) are necessary to remove obsolete references to photographic traffic signal enforcement programs. House Bill 1631 prohibited the use of such programs with the enactment of Transportation Code §707.20 and §707.21. The department timely implemented HB 1631 and ceased the prohibited actions; however, a change was not made to the rule to remove the provisions. Because §217.36(b) was removed, §217.36(c) and (d) have been redesignated as §217.36(b) and (c), respectively.

The amendments to §217.45(b)(3), (d)(3)(B) and (E), (e)(1)(A), and (f)(1) are necessary to conform the section with the SB 876 any willing county amendment to Transportation Code §502.040 and §502.041, including by changing the reference from "the" to "a" county tax assessor-collector. The department has added the phrase "of the county" between the words "assessor-collector" and "in which" to clarify §217.45(b)(3) and (e)(1)(A). The department has also adopted amending §217.45(f)(1) to remove the reference to log loader license plates in a replacement paragraph, because log loader plates cannot be replaced.

The amendments to §217.46(d)(3), (e)(1), and (f) are necessary to conform the section with the SB 876 any willing county amendment to Transportation Code §502.041. The §217.46(d)(3) amendment removes the reference to "as indicated on the License Plate Renewal Notice" because an "appropriate" county may be a willing county. Similarly, §217.46(f) amendment removes the requirement to go to "the county in which the owner resides" for replacement license plates. The amendments to §217.46(c)(1)(C) and (4) substitute the term "vehicle identification number" for "motor number." The amendment to §217.46(c)(3)(B)(ii) removes the requirement for "tire size" because the department does not collect the information in this context. The amendments to §217.46(d)(2), (3), and (4) conform to current statutory references by replacing the term "license plate renewal notice" with the term "registration renewal notice." Finally, the amendment to §217.46(d)(2) also replaces the word "mail" with "send" should additional distribution methods be adopted in the future.

The amendment to §217.89(b) is necessary to conform the section with the SB 876 any willing county amendment to Transportation Code §501.023(a). The amendments to §217.89(c) and (d)(3)(B) are based on a review of the enacting statute HB 3588, 78th Legislature, Regular Session (2003), which established the $65 rebuilder fee and submission requirements. House Bill 3588 did not have a savings clause for the prior inspections. The department is adopting to apply the change prospectively and not to any existing title issued under the process. The amendments to §217.89(d)(2)(D) and (G) are to update the rule to conform with the existing process that does not require the owner's address, but does require the rebuilder's name, address, and signature. The amendments to §217.89(d)(3)(A) update the requirement to refer to the "authorization or certificate number and the date of inspection" instead of a "sticker" number and "expiration." The amendment to §217.89(d)(5) updates the statutory reference to Transportation Code §502.046, which was transferred, redesignated, and amended from Transportation Code §502.153 by HB 2357 Acts 2011, 82nd Legislature, Regular Session (2012).

The rules are adopted to be effective March 1, 2022, the effective date of SB 876.

SUMMARY OF COMMENTS.

The department received written comments requesting a change in the proposed text from the Lubbock County Tax Assessor-Collector, Tax Assessor Collectors Association of Texas, Texas Automobile Dealers Association, and Texas Independent Automobile Dealers Association.

Comment:

Two commenters recommended the department add language to the rule that clarifies how funds will be collected, refunded, and dispersed between willing counties. The commenter asked how dishonored payments will be managed efficiently.

Agency Response:

The department appreciates the comment. The rules as proposed conform existing rule to the requirements of SB 876. As amended by SB 876, Transportation Code §520.006 specifies the distribution of fees that each county will receive. The rules as proposed do not address the disbursement of funds, and are outside the scope of the proposal. Counties will remit funds following existing statutes such as Transportation Code §502.198. The department will make any necessary programming changes in the existing Registration and Title System to ensure the existing requirements for the fee distribution continue as specified under law including in Transportation Code §520.006. The department declines to make changes based on the comment.

Comment:

A commenter asked if a title is processed in a participating county, not the county of residence, and the title is rejected through Austin or NMVTIS, how will the affected county be able to access the documents to correct the title in a timely manner.

Agency Response:

The department appreciates the comment. Senate Bill 876 has no impact on processing rejected transactions. The proposed rules do not change existing requirements for the processing county. Under current practice, the processing county is responsible for rejected transactions. The department declines to make changes based on the comment.

Comment:

A commenter asked how specialty license plates will be picked up from a participating county if they are currently sent to their county based on the address.

Agency Response:

The department appreciates the comment. The proposed rules do not change existing processes for specialty license plates. The department will continue to send specialty license plates to the county of residence. The department declines to make changes based on the comment.

Comment:

A commenter recommended including language that affirms that the department will be responsible for dispersing funds collected between willing counties.

Agency Response:

The department appreciates the comment. The rules as proposed conform existing rule to the requirements of SB 876. As amended by SB 876, Transportation Code §520.006 specifies the distribution of fees that each county will receive. The rules as proposed do not address the disbursement of funds and are outside the scope of the proposal. Counties will remit funds following existing statutes such as Transportation Code §502.198. The department will make any necessary programming changes in the existing Registration and Title System to ensure the existing requirements for the fee distribution continue as specified under law including in Transportation Code §520.006. The department declines to make changes based on the comment.

Comment:

A commenter recommended including language that affirms the department will be responsible for dispersing funds collected to all state agencies in the same manner as is currently dispersed if processed by a willing county.

Agency Response:

The department appreciates the comments regarding the disbursement of fees. The rules as proposed implement SB 876. The existing requirements under Transportation Code §520.006 that specifies the fees that each county receives was not changed by SB 876. The rules as proposed do not address the disbursement of funds as that is outside the scope of the rule. Counties will remit funds following existing statutes such as Transportation Code §502.198. The department will make any necessary programming changes in the existing Registration and Title System to ensure the existing requirements for the fee distribution continue as specified under existing law including in Transportation Code §520.006. The department declines to make changes based on the comment.

Comment:

A commenter recommended including language detailing the management of NMVTIS if processed in a willing county

Agency Response:

The department appreciates the comment. The processing county will continue to process rejected transactions following existing processes. The department declines to make a change based on the comment.

Comment:

A commenter recommended including language that affirms that the department, through the Registration Title System, will be capable of validating the owner of resident's county to ensure the tax assessor-collector office is not responsible to validate the renewal, owner and vehicle location address through other means.

Agency Response:

The department appreciates the comment. The department will make conforming programming changes as necessary to department systems to ensure the validation of information necessary to determine whether the county as a willing county or statutory county. The department declines to make a change to the rule text regarding programming internal system based on the comment because it is outside the scope of the rule.

Comment:

A commenter recommended including language that the Registration and Title System will be capable of validating emission and non-emission counties for proper assessment of fees.

Agency Response:

The department appreciates the comment. The department will make conforming programming changes as necessary to department systems to validate emission and non-emission counties. The department declines to make a change based on the comment.

Comment:

A commenter recommended including language that details the manner by which companion applications such as webDealer, webSub, etc. will determine willing versus statutory counties.

Agency Response:

The department appreciates the comments. The proposed rules do not address webDealer, webSub, or other similar applications. If a county is willing that county's deputies will be willing. The department declines to make a change based on the comment.

Comment:

A commenter stated that §217.23 fails to provide a registration option for situations in which a natural disaster occurs. The commenter suggests adding §217.23(e) which states "if a county tax assessor-collector is closed or a county has been declared a natural disaster, the closest unaffected county shall be considered where an owner resides, or a motor vehicle is purchased or encumbered."

Agency Response:

The department appreciates the comment. Transportation Code §501.023 and §502.040(b) were amended by SB 876 to remove the department's designation of an alternative county if the owner's county of residence is closed for any reason and to instead allow any willing county to accept the registration. As such, a county tax assessor-collector may, with any necessary local determination, decide to assist following a natural disaster. The department declines to make a change based on the comment.

Comment:

A commenter stated that a "closure" should be defined as a "county tax assessor-collector being open to receive and process registrations for both dealers and residents for less than 35 hours a week."

Agency Response:

The department appreciates the comment. As addressed in prior responses to comments, Transportation Code §501.023 and §502.040(b) were amended by SB 876 to remove the department's designation of an alternative county if the owner's county of residence is closed for any reason and to instead allow any willing county to accept the registration. The department declines to make a change based on the comment.

Comment:

A commenter states that it should be clear if the normal tax assessor-collector is closed then the processor is paid the same amount as they would be for any other consumer residing in their county.

Agency Response:

The department appreciates the comment. As addressed in prior responses to comments, Transportation Code §501.023 and §502.040(b) were amended by SB 876 to remove the department's designation of an alternative county if the owner's county of residence is closed for any reason and to instead allow any willing county to accept the registration. Transactions involving a willing county will be determined under Transportation Code §520.006 as amended by SB 876. The department declines to make a change based on the comment.

Comment:

A commenter asked as there is no definition of "willing to accept the application," is a TAC allowed to pick and choose which dealer's transactions it is "willing" to accept?

Agency Response:

The department appreciates the comment. The department agrees that statute did not define "willing to accept the application" or provide additional requirements. The department declines to make a change based on the comment.

Comment:

A commenter asked if a county tax assessor-collector is required to disclose the necessary requirements for its willingness to accept an application.

Agency Response: