HBA-MSH H.B. 642 77(R)    BILL ANALYSIS


Office of House Bill AnalysisH.B. 642
By: Flores
Transportation
2/22/2001
Introduced



BACKGROUND AND PURPOSE 

Currently, all vehicles registered in Texas are issued a certificate of
title by the Texas Department of Transportation (TxDOT).  When borrowed
funds are used to purchase a vehicle the original title is sent to the
first lienholder, typically a financial institution, and the applicant is
sent a duplicate original title.  Both a duplicate original title issued by
TxDOT and a title receipt issued by a county tax assessor-collector on
application for a certificate of title are sufficient to prove ownership.
Although duplicate titles are used to show proof of ownership, such titles
are rarely needed.  The title receipt issued by a county tax
assessorcollector is sufficient to prove ownership.  TxDOT estimates that
eliminating the issuance of duplicate original titles and using
registration and title receipts would result in TxDOT realizing significant
savings. House Bill 642 removes the requirement that TxDOT  issue duplicate
original titles, authorizes the use of a registration receipt to prove
ownership of a vehicle, and authorizes TxDOT to issue titles valid for
registration purposes only. 

RULEMAKING AUTHORITY

It is the opinion of the Office of House Bill Analysis that rulemaking
authority is expressly delegated to the Texas Department of Transportation
in SECTION 4 (Section 501.0301, Transportation Code) and in SECTION 6 of
this bill. 

ANALYSIS

House Bill 642 amends the Transportation Code relating to the abolition of
the issuance of duplicate original titles for a motor vehicle by the Texas
Department of Transportation (TxDOT).  The bill requires that TxDOT send
the certificate to the applicant or, if there is a lien on the vehicle, to
the first lienholder.  The bill authorizes TxDOT, by rule, to provide for
the issuance of a title valid for registration purposes only and sets forth
the application fee for such a title. The bill requires TxDOT to adopt
rules to account for the abolition of duplicate original certificates of
title, removes references to duplicate original certificates of title, and
removes the provision relating to the renewal of a title receipt.  The bill
authorizes a person to use a registration receipt to evidence title to a
motor vehicle and not to transfer an interest in or establish a lien on the
vehicle. 

EFFECTIVE DATE

September 1, 2001.