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Documentary Fees, Temporary Tags, Safety Inspections, and Catalytic Converter Theft

Automobile regulations in Texas are undergoing significant changes following the 88th Texas Legislature, Regular Session (2023). Three pivotal bills—House Bill (HB) 718, HB 3297, and Senate Bill (SB) 224—have brought about substantial shifts in how dealerships and motorists interact with Texas Department of Motor Vehicles (TxDMV) rules and requirements. In addition, the OCCC During the TxDMV Board Meeting on June 27, 2024, the implementation of these legislative changes was a focal point.

1. OCCC Raises Documentary Fee to $225

The documentary fee that independent dealers in Texas can charge will increase to $225, effective July 11, following recent amendments to §84.205 in the Texas Administrative Code. This change aims to align the fee with current market conditions and ensure that it adequately covers the costs associated with handling and processing motor vehicle sale documents.

2. House Bill 718: Say Goodbye to Temporary Tags and Timed Permits

Key Changes:

  • Elimination of Temporary Tags: HB 718 has eliminated the use of temporary tags for newly purchased vehicles. Instead, new metal plates will be issued at the time of sale.

  • Phasing Out Timed Permits: Timed permits, which provided temporary registration for vehicles, are now replaced with new procedures for issuing metal plates directly.

Implications for Dealerships: Dealerships will need to adjust their processes to accommodate the issuance of metal plates at the point of sale. This change aims to enhance security and reduce the misuse of temporary tags, which have been linked to various legal and safety concerns.

Action Steps:

  • Ensure your staff is trained on the new metal plate issuance process.

  • Update your dealership's systems to comply with the new requirements.

  • Communicate the changes to your customers to ensure a smooth transition.?

3. House Bill 3297: Streamlining Vehicle Safety Requirements

Key Changes:

  • Elimination of Safety Inspections: HB 3297 has removed the requirement for annual vehicle safety inspections for most vehicles in Texas. The move is intended to reduce burdens on vehicle owners and streamline regulatory processes.

  • Please note: 60 percent of vehicles in Texas will require emissions inspections because 17 of the state's 254 counties that require emissions account for 60 percent of registered vehicles. Check your local laws to see how this applies to your inventory.

Implications for Dealerships: While this change reduces the administrative workload for both dealerships and customers, it is crucial to emphasize vehicle maintenance and safety independently. The responsibility now falls more heavily on vehicle owners to ensure their vehicles are safe for operation.

Action Steps:
  • Update customer communication materials to reflect the change.

  • Promote regular maintenance services to encourage vehicle safety.

  • Adjust your service department's offerings to accommodate this new regulatory landscape.

4. Senate Bill 224: Tightening Control on Catalytic Converters

Key Changes:

  • New Catalytic Converter Requirements: SB 224 introduces stringent regulations related to the sale, installation, and inspection of catalytic converters. These changes aim to curb theft and ensure environmental compliance.

Implications for Dealerships: Dealerships must adhere to new documentation and verification processes for catalytic converters. These measures will require meticulous record-keeping and compliance to avoid legal repercussions.
Action Steps:

  • Train staff on the new requirements for handling catalytic converters.

  • Implement robust documentation processes to ensure compliance.

  • Educate customers on the importance of catalytic converter regulations and the impact on their vehicles.

Looking Ahead: How TIADA Can Help You Stay Compliant

The changes mandated by HB 718, HB 3297, and SB 224 represent a significant shift in the regulatory landscape for Texas auto dealers. Staying informed and prepared is crucial to navigate these new requirements successfully.
TIADA is here to support you with:

  • Comprehensive Training: We offer courses and resources to help you understand and comply with new regulations.

  • Regulatory Updates: Stay informed with our regular updates on legislative changes and industry news.

  • Advocacy: We continue to advocate for policies that benefit independent auto dealers in Texas.

Contact Us: For more information on how these changes affect your dealership and how to stay compliant, reach out to TIADA at education@txiada.org or call 512-244-6060.

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