[Senate Report 106-123]
[From the U.S. Government Publishing Office]



                                                       Calendar No. 231
106th Congress                                                   Report
                                 SENATE
 1st Session                                                    106-123
_______________________________________________________________________



 
    NATIONAL SALVAGE MOTOR VEHICLE CONSUMER PROTECTION ACT OF 1999


                               __________

                              R E P O R T

                                 OF THE

           COMMITTEE ON COMMERCE, SCIENCE, AND TRANSPORTATION

                                   on

                                 S. 655



                                     

                 July 28, 1999.--Ordered to be printed

                               __________

                    U.S. GOVERNMENT PRINTING OFFICE
69-010                     WASHINGTON : 1999



       SENATE COMMITTEE ON COMMERCE, SCIENCE, AND TRANSPORTATION

                       one hundred sixth congress

                             first session

                     JOHN McCAIN, Arizona, Chairman

TED STEVENS, Alaska                  ERNEST F. HOLLINGS, South Carolina
CONRAD BURNS, Montana                DANIEL K. INOUYE, Hawaii
SLADE GORTON, Washington             JOHN D. ROCKEFELLER IV, West 
TRENT LOTT, Mississippi              Virginia
KAY BAILEY HUTCHISON, Texas          JOHN F. KERRY, Massachusetts
OLYMPIA SNOWE, Maine                 JOHN B. BREAUX, Louisiana
JOHN ASHCROFT, Missouri              RICHARD H. BRYAN, Nevada
BILL FRIST, Tennessee                BYRON L. DORGAN, North Dakota
SPENCER ABRAHAM, Michigan            RON WYDEN, Oregon
SAM BROWNBACK, Kansas                MAX CLELAND, Georgia

                       Mark Buse, Staff Director

                  Martha P. Allbright, General Counsel

     Ivan A. Schlager, Democratic Chief Counsel and Staff Director

               Kevin D. Kayes, Democratic General Counsel

                                  (ii)
106th Congress                                                   Report
                                 SENATE
 1st Session                                                    106-123

======================================================================




     NATIONAL SALVAGE MOTOR VEHICLE CONSUMER PROTECTION ACT OF 1999

                                _______
                                

                 July 28, 1999.--Ordered to be printed

                                _______


       Mr. McCain, from the Committee on Commerce, Science, and 
                Transportation, submitted the following

                              R E P O R T

                         [To accompany S. 655]

    The Committee on Commerce, Science, and Transportation, to 
which was referred the bill (S. 655) ``A Bill to establish 
nationally uniform requirements regarding the titling and 
registration of salvage, nonrepairable, and rebuilt vehicles'', 
having considered the same, reports favorably thereon without 
amendment and recommends that the bill do pass.

                          Purpose of the Bill

    The purpose of the bill is to foster nationally uniform 
requirements regarding the titling and registration of salvage, 
nonrepairable, and flood vehicles.

                          Background and Needs

    Inconsistencies in State laws concerning the titling of 
automobiles foster automobile theft and exposes consumers to 
fraud by making it possible to hide information that a vehicle 
was massively damaged and then rebuilt.
    The Anti-Car Theft Act of 1992 (P.L. 102-519) addressed 
differences in State automobile titling laws used by criminals 
to thwart law enforcement efforts. The Act also established a 
task force to ``study the problems which relate to motor 
vehicle titling, vehicle registration, and controls over motor 
vehicle salvage which may effect the motor vehicle theft 
problem.''.
    This task force examined two problems related to salvage 
vehicles: vehicle theft and how consumers obtain information 
that a vehicle was rebuilt from salvage.
    Vehicle theft is facilitated by the practice of ``title 
washing'' in which the vehicle identification number (VIN) from 
a salvage vehicle is placed on a similar stolen vehicle. The 
vehicle is then retitled in a State that does not ``brand'' the 
title as belonging to a salvage vehicle. By retitling the car 
in this manner, the thief has ``washed'' the title of the 
salvage brand so that it may be resold with relative ease.
    Title washing can also deprive consumers of important 
information about a vehicle even when theft is not involved. If 
a vehicle is significantly damaged, the owner's insurance 
company often takes title to the vehicle and sells it as a 
salvage vehicle. That salvage vehicle may be purchased by a 
rebuilder, rebuilt and resold without the purchaser knowing. 
Information about the vehicle's history is lost if someone in 
the chain of ownership washes the title of the salvage brand by 
retitling the vehicle in a State that does not carry forward 
the title brands of other States. When a title has been washed 
in this manner, all later purchasers are deprived of 
information that may alert them to potential problems with the 
vehicle. These later purchasers may include auto dealers that 
purchased the vehicle at a used car auction or an individual 
purchasing the car for personal use.
    The Motor Vehicle Titling, Registration and Salvage 
Advisory Committee examined these concerns and transmitted its 
report to Congress on February 10, 1994. Among the Advisory 
Committee's recommendations were: (1) Federal legislation to 
create uniform definitions for certain title brands, including 
``salvage,'' ``nonrepairable,'' and ``flood vehicle''; (2) 
national standards for how and when ownership documents for 
salvage and nonrepairable vehicles must be applied for and 
issued; (3) how and when duplicate titles should be issued; and 
(4) national uniform standards for VIN and Safety inspections 
of rebuilt salvage vehicles.
    S. 655 is based on the Advisory Committee's 
recommendations.

                      Summary of Major Provisions

    S. 655 would establish incentives for States to participate 
in a regulatory framework that would establish nationally 
uniform definitions for certain terms used on vehicles titles 
such as: ``salvage vehicle,'' ``rebuilt salvage vehicle,'' 
``nonreparable vehicle,'' and ``flood vehicle.'' In 
participating States, the legislation would preempt State law 
to the extent that it is inconsistent with these definitions. 
However, States which establish lower percentage thresholds for 
determining salvage vehicles would not be considered 
inconsistent with the definitions.
    S. 655 would require participating States, in licensing a 
passenger motor vehicle whose ownership has been transferred, 
to disclose on the certificate of title whenever records 
indicate that such vehicle was previously issued a title that 
contained a word or symbol signifying that it was salvage, 
unrebuildable, parts only, scrap, junk, nonrepairable, 
reconstructed, rebuilt or that it had been damaged by flood. 
The bill also requires disclosure in other forms. S. 655 
requires rebuilt salvage vehicles to have a label affixed to 
the window or windshield. It also requires written disclosure 
at the point of sale that the vehicle is a rebuilt salvage or a 
flood vehicle.
    The legislation would require the Secretary of 
Transportation to establish, for participating States, 
nationally uniform standards for titles and title brands, 
including standards for anti-theft and safety inspections of 
rebuilt vehicles for States that require safety inspections.
    S. 655 would establish civil penalties for violations of 
the Act.

                          Legislative History

    S. 655 was introduced by Senator Lott on March 17, 1999. No 
hearings were held on the measure. The Committee did hold 
hearings on a similar version, S. 852, the National Motor 
Vehicle Safety Anti-Theft, Title Reform, and Consumer 
Protection Act of 1997 during the 105th Congress. S. 852 was 
amended in the nature of a substitute and reported by the 
committee. There are significant differences between the bill 
in the 105th Congress and the bill the Committee reports this 
Congress. For example, the threshold defining ``salvage 
vehicle'' was lowered from 80 percent to 75 percent. In 
addition, States can use a lower threshold to define a salvage 
vehicle and still be in compliance with the bill. The bill from 
the 105th Congress only allowed States to cover vehicles 7 
years and younger with a value greater than $10,000. The 
current bill allows States to cover any vehicle regardless of 
age and the value was lowered to $7,500. The bill no longer 
preempts State law and States are no longer required to adopt 
the provisions of the bill to receive funding for the National 
Motor Vehicle Titling Information System. Also, the bill grants 
state attorneys general the ability to sue on behalf of 
citizens who are victimized by rebuilt salvage fraud and to 
recover monetary judgements for damages. The bill allows States 
to continue to use terms not defined in the bill and it 
includes language ensuring that any existing private right of 
action is not affected by the bill.

                            Estimated Costs

    In accordance with paragraph 11(a) of rule XXVI of the 
Standing Rules of the Senate and section 403 of the 
Congressional Budget Act of 1974, the Committee provides the 
following cost estimate, prepared by the Congressional Budget 
Office:

                                     U.S. Congress,
                               Congressional Budget Office,
                                     Washington, DC, July 16, 1999.
Hon. John McCain,
Chairman, Committee on Commerce, Science, and Transportation,
U.S. Senate, Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office has 
prepared the enclosed cost estimate for S. 655, the National 
Salvage Motor Vehicle Consumer Protection Act of 1999.
    If you wish further details on this estimate, we will be 
pleased to provide them. The CBO staff contacts are James 
O'Keeffe (for federal costs), Lisa Cash Driskill (for the state 
and local impact), and Patrice Gordon (for the private-sector 
impact).
            Sincerely,
                                          Barry B. Anderson
                                    (For Dan L. Crippen, Director).

               Congressional Budget Office Cost Estimate


S. 655--National Salvage Motor Vehicle Consumer Protection Act of 1999

    Summary: The National Salvage Motor Vehicle Consumer 
Protection Act of 1999 would direct the Department of 
Transportation (DOT) to establish uniform national standards 
for titling and registering salvage, nonrepairable, and rebuilt 
vehicles. If states choose to adopt these standards, they would 
be eligible to receive incentive grants to help defray the 
costs of complying. In participating states, civil penalties 
would be established for individuals who knowingly provide 
false information on disclosures made pursuant to the bill's 
provisions, or who violate its vehicle titling and disclosure 
requirements.
    Assuming appropriation of the authorized and estimated 
amounts, CBO estimates that implementing S. 655 would result in 
additional discretionary spending of approximately $16 million 
over the 2000-2004 period. The legislation could affect direct 
spending and receipts; therefore, pay-as-you-go procedures 
would apply. However, CBO estimates that any such effects would 
be insignificant.
    S. 655 contains no intergovernmental mandates as defined in 
the Unfunded Mandates Reform Act (UMRA). It would, however, 
place additional requirements on states that receive funds 
authorized in the bill and that participate in the National 
Motor Vehicle Title Information System (NMVTIS).
    The bill would impose private-sector mandates, but CBO 
estimates that the direct costs of those mandates would not 
exceed the annual threshold established in UMRA ($100 million 
in 1996, adjusted annually for inflation) in any of the first 
five years that the mandates are effective.
    Description of the bill's major provisions: S. 655 would 
establish uniform national standards for titling and 
registering salvage, nonrepairable, and rebuilt vehicles. For 
states that choose to participate in the National Motor Vehicle 
Title Information System, the bill specifies information that 
must be included on a vehicle title and procedures that must be 
followed to minimize the opportunity for fraud. NMVTIS is an 
information network that will seek to provide all participants 
with instant and reliable access to information maintained by 
the states related to automobile titling.
    The legislation would require that all rebuilt salvage 
vehicles pass a state anti-theft inspection and lists 
procedures that should be included in this inspection. For 
those states that choose to require a safety inspection of 
rebuilt salvage vehicles, S. 665 would direct the Secretary of 
Transportation to establish uniform national safety inspection 
criteria. The legislation would establish civil penalties for 
individuals in participating states who knowingly provide false 
information on disclosures made pursuant to its provisions, or 
who violate its vehicle titling and disclosure requirements.
    The bill would authorize the appropriation of $16 million 
in 2000 for incentive grants to assist states in implementing 
NMVTIS. These grants would be made to states deemed by the 
Secretary of Transportation to be taking appropriate actions to 
implement the provisions of S. 655. (The legislation also would 
permit the Attorney General to continue making reasonable and 
necessary grants, as authorized under current law, to 
participating states assist them in joining NMVTIS.)
    The bill also would require DOT to develop and implement a 
program to notify motor vehicle dealers and distributers that 
they are prohibited under current law from selling any new 
vehicle for use as a schoolbus that does not meet schoolbus 
safety requirments.
    Estimated cost to the Federal Government: CBO estimates 
that DOT would spend approximately $16 million over the 2000-
2004 period to implement S. 665, assuming appropriation of the 
authorized and estimated amounts. The Department of Justice 
(DOJ) could also incur costs to implement the bill, but CBO 
expects that they would not be significant. The Anti-Car Theft 
Improvements Act of 1995 (Public Law 104-152) transferred 
federal authority over the title information system from the 
Secretary of Transportation to the Attorney General. Under S. 
655, DOJ would retain responsibility for administering and 
funding NMVTIS at the federal level.
    The estimated budgetary impact of S. 655 is shown in the 
following table. For the purposes of this estimate, CBO assumes 
that S. 655 will be enacted by the end of fiscal year 1999. The 
costs of this legislation fall within budget function 400 
(transportation).


----------------------------------------------------------------------------------------------------------------
                                                                    By fiscal years, in millions of dollars--
                                                               -------------------------------------------------
                                                                  2000      2001      2002      2003      2004
----------------------------------------------------------------------------------------------------------------
                                        SPENDING SUBJECT TO APPROPRIATION
Estimated authorization level.................................        16     (\1\)     (\1\)     (\1\)     (\1\)
Estimated Outlays.............................................     (\1\)         4         7         3        2
----------------------------------------------------------------------------------------------------------------
\1\ Less than $500,000.


    Based on information DOT, CBO expects that distribution of 
the incentive grants would not begin until 18 months after 
enactment of this bill, by which time DOT must finalize a rule 
governing the uniform standards and control methods. Therefore, 
we anticipate that disbursement of the grants would begin in 
the middle of 2001 and continue beyond 2004.
    Based on information from DOT, CBO estimates that the total 
cost of writing the rule that specifies uniform safety 
provisions for states that choose to require safety inspections 
would be less than $100,000. It would cost approximately 
$250,000 to determine whether user fees would cover state costs 
of developing uniform safety and titling provisions and to 
report the results to the Congress. In addition, DOT expects 
that it would need to hire one full-time employee to review 
safety and titling programs of individual states and convey the 
information to interested parties. The new position would 
likely be at the GS-15 level, resulting in costs for 
compensation and expenses totaling about $500,000 over the 
2000-2004 period. The other requirements that this legislation 
would impose on DOT are likely to have negligible costs. In 
total, CBO estimates that administrative costs for implementing 
the bill would be less than $500,000 a year.
    Pay-as-you-go considerations: The Balanced Budget and 
Emergency Deficit Control Act sets up pay-as-you-go procedures 
for legislation affecting direct spending or receipts. Imposing 
the new civil fines contained in S. 655 could result in an 
increase in governmental receipts, but CBO estimates that any 
such changes would be less than $500,000 a year.
    Estimated impact on State, local, and tribal governments: 
S. 655 contains no intergovernmental mandates as defined in the 
Unfunded Mandates Reform Act. It would, however, place 
additional requirements on states that choose to accept funds 
authorized in the bill and participate in the National Motor 
Vehicle Title Information System. The goal of NMVTIS is to 
build a national information network that will allow states to 
share information about motor vehicle titles in order to reduce 
theft. A state accepting funds authorized by the bill to help 
it link to the network could face additional costs if its 
existing regulations and procedures for inspecting and titling 
salvage, rebuilt, and flood-damaged vehicles differ from the 
federal standards.
    States have varying procedures currently in place for 
regulating salvage, rebuilt, and flood-damaged vehicles. They 
would thus face different costs depending on the extent to 
which they need to modify their systems to conform to the 
federal standards. Some states would have to pass new laws. For 
other states, the changes would be mostly administrative and 
would involve activities such as modifying the position of 
information on vehicle titles, printing new forms, and adopting 
changes to definitions and procedures for handling titles. 
These states would face modest one-time costs to bring their 
regulations and procedures into conformity.
    Costs in states that chose to establish new procedures or 
systems would be higher and would include both these one-time 
costs and new annual operating expenses. For example, many 
states do not issue titles for nonrepairable vehicles and would 
be required to do so if they participate in NMVTIS. Some states 
also would have to expand their anti-theft inspection programs 
to meet the uniform standards. Costs for these states could 
reach into the millions of dollars.
    Estimated impact on the private sector: S. 655 would impose 
a new private-sector mandate on sellers of rebuilt salvage 
vehicles and would change an existing mandate on insurance 
carriers and on operators of junk yards and salvage yards. 
Based on information provided by government and industry 
sources, CBO estimates that the direct costs of those private-
sector mandates would not exceed the annual threshold 
established in UMRA ($100 million in 1996, adjusted annually 
for inflation) in any of the first five years that the mandates 
are effective. The bill also would impose new requirements on 
the private sector in states that choose to implement 
incremental standards and control methods for titling and 
registering salvage, nonrepairable, and rebuilt vehicles based 
on the uniform criteria to be establish under the bill's 
guidelines.
    S. 655 would require persons transferring ownership of 
rebuilt salvage vehicles to give the transferee a written 
disclosure that the vehicle is a rebuilt salvage vehicle, when 
such person has actual knowledge of the status of the vehicle. 
Because such a disclosure would most likely be a standardized 
form, CBO estimates that the costs of this new mandate would be 
minimal.
    S. 655 would modify an existing mandate on insurance 
carriers and operators of junk yards and salvage yards. Under 
the current law, those entities are required to include an 
inventory of junk and salvage automobiles in their monthly 
reports to the operator of the National Motor Vehicle Title 
Information System. Under S. 655, they would be required to 
include an inventory of certain flood-damaged, nonrepairable, 
salvage, and rebuilt salvage vehicles in their reports. The 
NMVTIS system is in the early stages of development, and the 
reporting requirements for the private sector have not yet been 
implemented. Based on information provided by government and 
industry sources, CBO estimates that the additional direct 
costs of the revised mandate would be minor.
    In addition, the bill outlines certain uniform titling and 
registration requirements that could affect the private sector 
in states receiving funds under the federal grant program that 
would be established by the bill. Currently each state has 
different procedures in place for regulating salvage and 
rebuilt vehicles. In states that decide to receive grants and 
adopt the uniform standards and control methods under the bill, 
additional requirements could be imposed on the private sector 
related to the titling and labeling of rebuilt salvage 
vehicles, the certification of nonrepairable vehicles, the 
labeling and disclosure of flood-damaged vehicles, and the 
disclosure of damage to salvage vehicles. Such new requirements 
implemented by states would impose costs on the private sector, 
but are not considered federal mandates under UMRA. CBO does 
not expect the costs to the private sector of such incremental 
requirements to be significant.
    Estimate prepared by: Federal Costs: James O'Keeffe. Impact 
on State, Local, and Tribal Governments: Lisa Cash Driskill. 
Impact on the Private Sector: Patrice Gordon.
    Estimate approved by: Robert A. Sunshine, Deputy Assistant 
Director for Budget Analysis.

                      Regulatory Impact Statement

    In accordance with paragraph 11(b) of rule XXVI of the 
Standing Rules of the Senate, the Committee provides the 
following evaluation of the regulatory impact of the 
legislation, as reported:

                       number of persons covered

    The legislation would apply to those involved with vehicles 
that meet the definition of a salvage vehicle, a flood vehicle 
or a nonrepairable vehicle. The legislation would foster 
uniform definitions of those terms and thereby better inform 
all consumers (including auto dealers and the ultimate driver 
of the vehicle) about the history of a vehicle that has been 
massively damaged and then repaired.

                            economic impact

    This legislation would have minimal impact on the nation's 
economy. It would aid the appropriate functioning of the market 
for rebuilt motor vehicles but that would have little 
macroeconomic effect.

                         privacy and paperwork

    This legislation would not have any significant adverse 
impact on the personal privacy of the individuals affected nor 
would it institute burdensome paperwork requirements. The 
legislation would require that if a car is massively damaged, a 
person must obtain a salvage title and then have the car 
inspected before the car is issued a title that would permit it 
to be driven on roads and highways. The vehicle's title would 
then reflect its history and indicate that it had been rebuilt. 
In some States, these procedures would require both additional 
disclosures of the vehicle's history and the acquisition of a 
new title for the vehicle once it has been rebuilt.

                      Section-by-Section Analysis


Section 1. Short title

    This section provides that the Act may be cited as the 
``National Salvage Motor Vehicle Consumer Protection Act of 
1999.''

Section 2. Motor vehicle titling and disclosure requirements

    Subsection (a) of this section amends title 49, United 
States Code, by inserting at its end a new chapter, chapter 
333, ``Automobile Safety and Title Disclosure Requirements''. 
Subsection (b) makes a conforming amendment to the United 
States Code.
    The new chapter 333 is comprised of eight sections.

Sec. 33301. Definitions

    Section 33301 establishes several new definitions for the 
purposes of chapter 333.
    The term ``salvage vehicle'' is defined as any passenger 
motor vehicle which is a late model vehicle, which has been 
wrecked, destroyed, or damaged to the extent that the total 
estimated or actual cost of repairs to rebuild or reconstruct 
that vehicle to its roadworthy condition immediately before it 
was wrecked, destroyed, or damaged exceeds 75 percent of the 
retail value of the vehicle. A vehicle is also a salvage 
vehicle if it is voluntarily designated by the owner as a 
salvage vehicle or if the vehicle is acquired by an insurance 
company after it was wrecked, destroyed, or damaged, and was 
acquired pursuant to a damage settlement (except in the case of 
a settlement in connection with a recovered stolen automobile, 
unless such automobile was damaged enough to meet the 75 
percent threshold).
    The term ``salvage title'' is defined as a passenger motor 
vehicle ownership document issued by a State to the owner of a 
salvage vehicle and is conspicuously labeled with the word 
``salvage'' across the front.
    The term ``rebuilt salvage vehicle'' is defined as a 
passenger motor vehicle which was previously issued a salvage 
title, has passed a State anti-theft inspection, and has been 
issued a certificate stating so. In States that require safety 
inspections for rebuilt salvage vehicles, the rebuilt salvage 
vehicle must pass such inspection, be issued a certificate 
stating so, and have a decal stating that it is a ``Rebuilt 
Salvage Vehicle-Anti-theft and Safety Inspections Passed.'' In 
States which do not require safety inspections, the rebuilt 
salvage vehicle must have a decal stating that it is a 
``Rebuilt Salvage Vehicle-Anti-theft Inspection Passed/No 
Safety Inspection Pursuant to National Criteria.''
    The term a ``rebuilt salvage title'' is defined as a 
passenger motor vehicle ownership document issued to the owner 
of a rebuilt salvage vehicle and is conspicuously labeled with 
words indicating that it is a rebuilt salvage vehicle and 
whether or not it has passed a safety inspection pursuant to 
national criteria.
    The term ``nonrepairable vehicle'' is defined as any 
passenger motor vehicle which is incapable of safe operation on 
the roads and highways and which has no resale value except as 
a source of parts or scrap, or which the owner irreversibly 
designates as a source of parts or scrap.
    Nonrepairable vehicles are issued nonrepairable vehicle 
certificates, which are defined as an ownership document issued 
by the State to the owner of a nonrepairable vehicle, and may 
never again be retitled.
    The term ``Secretary'' refers to the Secretary of 
Transportation.
    The term ``late model vehicle'' is defined as any passenger 
motor vehicle which has a manufacturer's model year designation 
of or later than the year in which the vehicle was wrecked, 
destroyed, or damaged, or any of the six preceding years, or 
has a retail value of more than $7,500. The Secretary is 
required to adjust the retail value figure by $500 increments 
every 5 years beginning with an increase to $8 thousand on 
January 1, 2005.
    The term ``retail value'' is defined as the actual cash 
value, fair market value, or retail value of a passenger motor 
vehicle as either set forth in the current edition of any 
nationally recognized compilation of retail values, which may 
include automated databases, or (B) as determined by conducting 
a market comparison of vehicles with like equipment and in a 
similar condition.
    The term ``cost of repairs'' is defined as the estimated or 
actual cost of the parts used in the repairs plus the 
reasonable and customary labor charges in the community where 
the repairs are to be performed.
    The term ``flood vehicle'' is defined as any passenger 
motor vehicle that is acquired by an insurance company as part 
of a damage settlement due to water damage or a vehicle that 
has been submerged in water such that rising water has reached 
over the door sill, entered the passenger or trunk compartment, 
has exposed any electrical, computerized, or mechanical 
component to water. Exceptions from this definition are 
provided if an inspection, conducted using guidelines 
established either by the State or the Secretary, indicates 
that no electrical, computerized or mechanical components were 
damaged by water or if they were damaged by water they have 
been repaired or replaced.

Sec. 33302. Passenger motor vehicle titling

    The provisions of section 33302 apply to any State that 
receives funds under Sec. 33308 of this chapter.
    Subsection (a) requires that participating States ``carry 
forward'' any brand on a title from another State signifying 
that the vehicle was previously issued a title that bore any 
word or symbol indicating that the vehicle was ``salvage,'' 
``unrebuildable,'' ``parts only,'' ``scrap,'' ``junk,'' 
``nonrepairable,'' ``reconstructed,'' ``rebuilt,'' that it has 
been damaged by flood, or any other similar word or symbol, by 
disclosing such status on the new certificate of title. States 
are required to begin carrying forward other States brands no 
later than one year after the date of enactment.
    Subsection (b) contains the bulk of requirements for 
participating States. This subsection requires the Secretary to 
issue a rule no later than 18 months after the date of 
enactment requiring participating States apply uniform 
standards, procedures, and methods of control for the issuance 
and control of titles for motor vehicles and for information 
contained in such titles. States will have two years from the 
date on which the Secretary issues the final rule to comply. 
The rule issued by the Secretary is to have the following 
components described in paragraphs (1) through (12).
    Paragraph (1) requires the participating State to 
conspicuously indicate on the face of a title whether the 
vehicle is a salvage vehicle, a nonrepairable vehicle, or a 
rebuilt salvage vehicle or a flood vehicle.
    Paragraph (2) requires that such information be carried 
forward by the State or any other participating State.
    Paragraph (3) requires that any titling documents, decals, 
certificates, or issuing systems used by participating States 
must meet security standards that minimize the opportunity for 
fraud.
    Paragraph (4) requires that the certificate of title issued 
by a participating State shall include the passenger motor 
vehicle make, model, body type, year, odometer disclosure, and 
vehicle identification number.
    Paragraph (5) requires that titling documents issued by the 
participating State are required to be in a uniform layout, 
either established with the participating State or an 
organization representing participating States.
    Paragraph (6) requires that nonrepairable vehicles shall be 
issued nonrepairable vehicle certificates by participating 
States and shall not again be retitled.
    Paragraph (7) stipulates that a salvage vehicle may not be 
issued a rebuilt salvage title by a participating State unless, 
after it is repaired or rebuilt, it complies with the 
requirements for a rebuilt salvage vehicle outlined in section 
33301(4). Any State inspection program operating under the 
authority of this paragraph would be required to have an 
inspection program for rebuilt salvage vehicles that meets 
certain defined requirements. Such inspection programs would be 
subject to continuing review by and approval of the Secretary.
    Paragraph (8) requires the Secretary to adopt nationally 
uniform safety inspection criteria for rebuilt salvage vehicles 
for use by States requiring a safety inspection.
    Paragraph (9) stipulates that no participating State may 
issue a duplicate title unless it is conspicuously labeled as a 
duplicate title and the State adopts procedures consistent with 
the recommendations of the Motor Vehicle Titling, Registration, 
and Salvage Advisory Committee.
    Paragraph (10) requires participating States to employ the 
ten enumerated titling and control methods described in 
subparagraphs (A) through (J).
    Paragraph (11) requires the seller of a passenger motor 
vehicle who has actual knowledge that the vehicle was damaged 
by flood to disclose that fact in writing to the buyer.
    Similarly, paragraph (12) requires that lessees give the 
same notice concerning flood vehicles to lessors.
    Paragraph (13) permits participating States to transfer 
ownership of a vehicle on a salvage title, but prohibits the 
registration of the vehicle for use on the roads or highways 
unless it receives a rebuilt salvage title.
    Paragraph (14) explicitly permits the transfer and 
registration of rebuilt salvage vehicles.
    Paragraph (15) limits the transfer of nonrepairable 
vehicles and prohibits the registration of those vehicles for 
use on the roads and highways.
    Subsection (c) allows participating States to use 
electronic procedures in lieu of paper documents as long as 
they provide the same information, function and security as 
required by this section.
    Subsection (d) directs the Secretary of Transportation to 
maintain a list of States that are in compliance with the act.

Sec. 33303. Disclosure and label requirements on transfer of rebuilt 
        salvage vehicles

    This section is intended to ensure that consumers are 
provided with adequate notice that they may be purchasing a 
rebuilt salvage vehicle.
    Subsection (a) requires the person transferring a rebuilt 
salvage vehicle, with actual knowledge of its status, to 
disclose that fact in writing to the person receiving the 
vehicle. Such written disclosures must be true, complete, and 
conform to regulations issued by the Secretary.
    Subsection (b) is meant to provide additional notice to 
consumers who are purchasing rebuilt salvage vehicles at their 
first retail sale after being rebuilt. This subsection requires 
that the person conducting an anti-theft inspection required 
under 33301(4) in a participating State affix a label to the 
window or windshield indicating that the vehicle is a rebuilt 
salvage vehicle and such other information as the Secretary may 
require. The label may not be removed, altered, or rendered 
illegible before the rebuilt salvage vehicle is delivered to 
the first retail purchaser.
    Subsection (c) indicates the requirements of subsections 
(a) and (b) only apply to the transfer of ownership of a 
rebuilt salvage vehicle where the transfer occurs in a State 
that is complying with the requirements of this section.

Sec. 33304. Report on funding

    This section requires the Secretary to issue a report to 
Congress, contemporaneously with the issuance of the rule under 
33302(b), on whether participating States could meet the costs 
of complying with that rule through user fees or the earmarking 
of revenues collected through law enforcement actions under the 
rule.

Sec. 33305. Effect on State law

    Subsection (a) provides that, as of the effective date of 
the rule issued under 33302(b), the provisions of the new 
chapter shall preempt all State laws in participating States to 
the extent that they are inconsistent with the provisions of 
the chapter or the rules issued under its authority, with 
respect to the form of the passenger motor vehicle titling 
document, definitions established under the new chapter, or 
titling, record keeping, anti-theft inspection, or control 
procedures.
    Subsection (b) specifically provides that preemptions are 
not to be construed as affecting any consumer law remedies 
which may be available to residents of the participating State 
for violations of the new chapter. Preemption under this 
subsection is limited to the terms used in the new chapter. 
Therefore, terms and brands other than those specifically 
preempted by the legislation would not be preempted. The bill 
specifically exempts the term older model salvage vehicle. 
Also, any vehicles which may be regulated by existing State 
statutes, but do not fall within the definition of passenger 
motor vehicle as defined by 33301(1), are not covered by the 
Act and existing State regulatory regimes applicable to those 
vehicles would remain intact. One of the central purposes of 
this statute is uniformity as to a limited number of 
definitions so that consumers have some information which may 
be relied upon as to the vehicle's history. All State laws that 
deal with the concept of ``Salvage vehicles'', that is vehicles 
that have been significantly damaged and then rebuilt, are not 
preempted. If a State would like to have its title contain 
disclosures in addition to the Federal disclosure, that is 
permitted as long as the Federal term is not interfered with. 
For example, if a State wanted to have a disclosure on the 
title if a vehicle was damaged to more that 50 percent of its 
retail value, the State may accomplish that goal by merely 
using a term other than ``Salvage'' to describe such a vehicle. 
Likewise, any State consumer law remedy that would apply to the 
class of vehicles regulated by the new chapter, even if the 
term used to refer to those vehicles is preempted under 
subsection (b), would not be inconsistent with this chapter and 
would remain intact.
    Subsection (c) explicitly permits additional disclosures of 
a passenger motor vehicle's title status or history, including 
those made on the face of a title. It also permits disclosures 
that a rebuilt salvage vehicle passed a safety inspection that 
differed from the national criteria promulgated by the 
Secretary pursuant to 33302(b)(8). However, the legislation 
preempts any participating State's definition of any term 
defined in the legislation as applied to a passenger motor 
vehicle. The Committee intends to permit States that disclose 
major damage to passenger motor vehicles, other than through 
different thresholds for the terms defined in 33301, to 
continue to disclose that information, regardless of where the 
information appears.

Sec. 33306. Civil penalties

    Subsection (a) lists the acts that are prohibited by the 
new chapter.
  Subsection (b) sets forth the civil penalties and clarifies 
that there is a separate violation for each passenger motor 
vehicle involved in the violation.

Sec. 33307. Actions by States

  Subsection (a) permits an action to enjoin the violation; 
recover penalties under section 33306; or recover damages 
suffered by any resident in the State who suffered damage as 
the result of a knowing violation of the law.
  Subsection (b) establishes a two-year statute of limitations.
  Subsection (c) requires that the State serve prior or 
contemporaneous written notice on the Attorney General of the 
United States of any action brought under subsections (a) or 
(e)(2). After notification, the Attorney General shall have the 
right to intervene or appeal such action.
  Subsection (e) stipulates rules for venue and service of 
process.
  Subsections (d) and (f) clarify that nothing in the new 
chapter prevents the Attorney General of a State, or other 
authorized official, from proceeding in State court on the 
basis of an alleged violation of a civil or criminal statute of 
the State. Further, nothing in the new chapter prohibits a 
State's attorney general or other State official from 
exercising the investigative powers conferred on that official.

Sec. 33308. Incentive grants

  This section allows the Secretary to provide incentive grants 
to participating States to carry out the provisions of the act.

Section 3. Amendments to chapter 305

  Subsection (a) conforms the definitions in chapter 305 to 
replace the terms junk automobile and salvage automobile with 
the terms nonrepairable vehicle and salvage vehicle. It also 
adds the term rebuilt salvage vehicle and defines all of the 
terms as they are defined by section 33301.
  Subsection (b) conforms the requirements of the National 
Motor Vehicle Title Information System (NMVTIS) to conform the 
changes in definitions made in subsection (a) and require the 
tracking of rebuilt salvage vehicles.
  Subsection (c) directs the Attorney General to conduct a 
review of systems used by States to compile and maintain 
information about the titling of automobiles and determine the 
cost of making that info available to NMVTIS.
  Subsection (d) directs the Attorney General to report to 
Congress on which States have joined the NMVTIS system and the 
impediments to those States which have not.

Section 4. Dealer notification program for prohibited sale of non-
        qualifying vehicles for use as school buses

  This section requires the Secretary of Transportation to 
develop a program to notify automobile dealers that it is 
illegal to sell a new vehicle for use as a school bus if it 
does not meet federal safety standards.

                        Changes in Existing Law

  In compliance with paragraph 12 of rule XXVI of the Standing 
Rules of the Senate, changes in existing law made by the bill, 
as reported, are shown as follows (existing law proposed to be 
omitted is enclosed in black brackets, new material is printed 
in italic, existing law in which no change is proposed is shown 
in roman):

                        TITLE 49--TRANSPORTATION

             Subtitle VI--Motor Vehicle and Driver Programs

                            PART A--GENERAL

                   CHAPTER 301--MOTOR VEHICLE SAFETY


                Subchapter II--Standards and Compliance


Sec. 30112. Prohibitions on manufacturing, selling, and importing 
                    noncomplying motor vehicles and equipment

    (a) In General.--Except as provided in this section, 
sections 30113 and 30114 of this title, and subchapter III of 
this chapter, a person may not manufacture for sale, sell, 
offer for sale, introduce or deliver for introduction in 
interstate commerce, or import into the United States, any 
mortor vehicle or motor vehicle equipment manufactured on or 
after the date an applicable motor vehicle safety standard 
prescribed under this chapter takes effect unless the vehicle 
or equipment complies with the standard and is covered by a 
certification issued under section 30115 of this title.
  (b) Nonapplication.--This section does not apply to--
          (1) the sale, offer for sale, or introduction or 
        delivery for introduction in interstate commerce of a 
        motor vehicle or motor vehicle equipment after the 
        first purchase of the vehicle or equipment in good 
        faith other than for resale;
          (2) a person--
                  (A) establishing that the person had no 
                reason to know, despite exercising reasonable 
                care, that a motor vehicle or motor vehicle 
                equipment does not comply with applicable motor 
                vehicle safety standards prescribed under this 
                chapter; or
                  (B) holding, without knowing about the 
                noncompliance and before the vehicle or 
                equipment is first purchased in good faith 
                other than for resale, a certificate issued by 
                a manufacturer or importer stating the vehicle 
                or equipment complies with applicable standards 
                prescribed under this chapter;
          (3) a motor vehicle or motor vehicle equipment 
        intended only for export, labeled for export on the 
        vehicle or equipment and on the outside of any 
        container of the vehicle or equipment, and exported;
          (4) a motor vehicle the Secretary of Transportation 
        decides under section 30141 of this title is capable of 
        complying with applicable standards prescribed under 
        this chapter;
          (5) a motor vehicle imported for personal use by an 
        individual who receives an exemption under section 
        30142 of this title;
          (6) a motor vehicle under section 30143 of this title 
        imported by an individual employed outside the United 
        States;
          (7) a motor vehicle under section 30144 of this title 
        imported on a temporary basis;
          (8) a motor vehicle or item of motor vehicle 
        equipment under section 30145 of this title requiring 
        further manufacturing; or
          (9) a motor vehicle that is at least 25 years old.
  (c) Notification Program for Dealers Concerning Sales of 
Vehicles as Schoolbuses.--Not later than September 1, 1999, the 
Secretary shall develop and implement a program to notify 
dealers and distributors in the United States that subsection 
(a) prohibits the sale or delivery of any vehicle for use as a 
schoolbus (as that term is defined in section 30125(a)(1) of 
this title) that does not meet the standards prescribed under 
section 30125(b) of this title.

           *       *       *       *       *       *       *


      CHAPTER 305--NATIONAL MOTOR VEHICLE TITLE INFORMATION SYSTEM


Sec. 30501. Definitions

  In this chapter--
          (1) ``automobile'' has the same meaning given that 
        term in section 32901(a) of this title.
          (2) ``certificate of title'' means a document issued 
        by a State showing ownership of an automobile.
          (3) ``insurance carrier'' means an individual or 
        entity engaged in the business of underwriting 
        automobile insurance.
          [(4) ``junk automobile'' means an automobile that--
                  [(A) is incapable of operating on public 
                streets, roads, and highways; and
                  [(B) has no value except as a source of parts 
                or scrap.]
          (4) ``nonrepairable vehicle'', ``salvage vehicle'', 
        ``flood vehicle'', and ``rebuilt salvage vehicle'' have 
        the same meanings given those terms in section 33301 of 
        this title.
          (5) ``junk yard'' means an individual or entity 
        engaged in the business of acquiring or owning [junk 
        automobiles] nonrepairable vehicles for--
                  (A) resale in their entirety or as spare 
                parts; or
                  (B) rebuilding, restoration, or crushing.
          (6) ``operator'' means the individual or entity 
        authorized or designated as the operator of the 
        National Motor Vehicle Title Information System under 
        section 30502(b) of this title, or the Attorney 
        General, if there is no authorized or designated 
        individual or entity.
          [(7) ``salvage automobile'' means an automobile that 
        is damaged by collision, fire, flood, accident, 
        trespass, or other event, to the extent that its fair 
        salvage value plus the cost of repairing the automobile 
        for legal operation on public streets, roads, and 
        highways would be more than the fair market value of 
        the automobile immediately before the event that caused 
        the damage.]
          [(8)] (7) ``salvage yard'' means an individual or 
        entity engaged in the business of acquiring or owning 
        [salvage automobiles] salvage vehicles for--
                  (A) resale in their entirety or as spare 
                parts; or
                  (B) rebuilding, restoration, or crushing.
          [(9)] (8) ``State'' means a State of the United 
        States or the District of Columbia.

Sec. 30502. National Motor Vehicle Title Information System

  (a) Establishment or Designation.--
          (1) In cooperation with the States and not later than 
        December 31, 1997, the Attorney General shall establish 
        a National Motor Vehicle Title Information System that 
        will provide individuals and entities referred to in 
        subsection (e) of this section with instant and 
        reliable access to information maintained by the States 
        related to automobile titling described in subsection 
        (d) of this section. However, if the Attorney General 
        decides that the existing information system meets the 
        requirements of subsections (d) and (e) of this section 
        and will permit the Attorney General to carry out this 
        chapter as early as possible, the Attorney General, in 
        consultation with the Secretary of Transportation, may 
        designate an existing information system as the 
        National Motor Vehicle Title Information System.
          (2) In cooperation with the Secretary of 
        Transportation and the States, the Attorney General 
        shall ascertain the extent to which title and related 
        information to be included in the system established 
        under paragraph (1) of this subsection will be 
        adequate, timely, reliable, uniform, and capable of 
        assisting in efforts to prevent the introduction or 
        reintroduction of stolen vehicles and parts into 
        interstate commerce.
  (b) Operation.--The Attorney General may authorize the 
operation of the System established or designated under 
subsection (a)(1) of this section by agreement with one or more 
States, or by designating, after consulting with the States, a 
third party that represents the interests of the States.
  (c) User Fees.--Operation of the System established or 
designated under subsection (a)(1) of this section shall be 
paid for by user fees and should be self-sufficient and not be 
dependent on amounts from the United States Government. The 
amount of fees the operator collects and keeps under this 
subsection subject to annual appropriation laws, excluding fees 
the operator collects and pays to an entity providing 
information to the operator, may be not more than the costs of 
operating the System.
  (d) Information Requirements.--The System established or 
designated under subsection (a)(1) of this section shall permit 
a user of the System at least to establish instantly and 
reliably--
          (1) the validity and status of a document purporting 
        to be a certificate of title;
          (2) whether an automobile bearing a known vehicle 
        identification number is titled in a particular State;
          [(3) whether an automobile known to be titled in a 
        particular State is or has been a junk automobile or a 
        salvage automobile;]
          (3) whether an automobile known to be titled in a 
        particular State is or has been a nonrepairable 
        vehicle, a rebuilt salvage vehicle, a flood vehicle, or 
        a salvage vehicle;
          (4) for an automobile known to be titled in a 
        particular State, the odometer mileage disclosure 
        required under section 32705 of this title for that 
        automobile on the date the certificate of title for 
        that automobile was issued and any later mileage 
        information, if noted by the State; and
          [(5) whether an automobile bearing a known vehicle 
        identification number has been reported as a junk 
        automobile or a salvage automobile under section 30504 
        of this title.]
          (5) whether an automobile bearing a known vehicle 
        identification number has been reported as a 
        nonrepairable vehicle, a rebuilt salvage vehicle, a 
        flood vehicle, or a salvage vehicle under section 30504 
        of this title.
  (e) Availability of Information.--
          (1) The operator shall make available--
                   (A) to a participating State on request of 
                that State, information in the System about any 
                automobile;
                   (B) to a Government, State, or local law 
                enforcement official on request of that 
                official, information in the System about a 
                particular automobile, junk yard, or salvage 
                yard;
                   (C) to a prospective purchaser of an 
                automobile on request of that purchaser, 
                including an auction company or entity engaged 
                in the business of purchasing used automobiles, 
                information in the System about that 
                automobile; and
                   (D) to a prospective or current insurer of 
                an automobile on request of that insurer, 
                information in the System about that 
                automobile.
          (2) The operator may release only the information 
        reasonably necessary to satisfy the requirements of 
        paragraph (1) of this subsection. The operator may not 
        collect an individual's social security account number 
        or permit users of the System to obtain an individual's 
        address or social security account number.
  (f) Immunity.--Any person performing any activity under this 
section or sections 30503 or 30504 in good faith and with the 
reasonable belief that such activity was in accordance with 
this section or section 30503 or 30504, as the case may be, 
shall be immune from any civil action respecting such activity 
which is seeking money damages or equitable relief in any court 
of the United States or a State.

[Sec. 30503. State participation

  [(a) State Information.--Each State shall make titling 
information maintained by that State available for use in 
operating the National Motor Vehicle Title Information System 
established or designated under section 30502 of this title.
  [(b) Verification Checks.--Each State shall establish a 
practice of performing an instant title verification check 
before issuing a certificate of title to an individual or 
entity claiming to have purchased an automobile from an 
individual or entity in another State. The check shall consist 
of--
          [(1) communicating to the operator--
                  [(A) the vehicle identification number of the 
                automobile for which the certificate of title 
                is sought;
                  [(B) the name of the State that issued the 
                most recent certificate of title for the 
                automobile; and
                  [(C) the name of the individual or entity to 
                whom the certificate of title was issued; and
          [(2) giving the operator an opportunity to 
        communicate to the participating State the results of a 
        search of the information.
  [(c) Grants to States.--
          [(1) In cooperation with the States and not later 
        than January 1, 1994, the Attorney General shall--
                  [(A) conduct a review of systems used by the 
                States to compile and maintain information 
                about the titling of automobiles; and
                  [(B) determine for each State the cost of 
                making titling information maintained by that 
                State available to the operator to meet the 
                requirements of section 30502(d) of this title.
          [(2) The Attorney General may make reasonable and 
        necessary grants to participating States to be used in 
        making titling information maintained by those States 
        available to the operator.
    [(d) Report to Congress.--Not later than October 1, 1998, 
the Attorney General shall report to Congress on which States 
have met the requirements of this section. If a State has not 
met the requirements, the Attorney General shall describe the 
impediments that have resulted in the State's failure to meet 
the requirements.]

Sec. 30503. State participation

    (a) State Information.--Each State receiving funds 
appropriated under subsection (c) shall make titling 
information maintained by that State available for use in 
operating the National Motor Vehicle Title Information System 
established or designated under section 30502 of this title.
    (b) Verification Checks.--Each State receiving funds 
appropriated under subsection (c) shall establish a practice of 
performing an instant title verification check before issuing a 
certificate of title to an individual or entity claiming to 
have purchased an automobile from an individual or entity in 
another State. The check shall consist of--
          (1) communicating to the operator--
                  (A) the vehicle identification number of the 
                automobile for which the certificate of title 
                is sought;
                  (B) the name of the State that issued the 
                most recent certificate of title for the 
                automobile; and
                  (C) the name of the individual or entity to 
                whom the certificate of title was issued; and
          (2) giving the operator an opportunity to communicate 
        to the participating State the results of a search of 
        the information.
    (c) Grants to States.--
          (1) In cooperation with the States and not later than 
        January 1, 1994, the Attorney General shall--
                  (A) conduct a review of systems used by the 
                States to compile and maintain information 
                about the titling of automobiles; and
                  (B) determine for each State the cost of 
                making titling information maintained by that 
                State available to the operator to meet the 
                requirements of section 30502(d) of this title.
          (2) The Attorney General may make reasonable and 
        necessary grants to participating States to be used in 
        making titling information maintained by those States 
        available to the operator.
    (d) Report to Congress.--Not later than October 1, 1999, 
the Attorney General shall report to Congress on which States 
have met the requirements of this section. If a State has not 
met the requirements, the Attorney General shall describe the 
impediments that have resulted in the State's failure to meet 
the requirements.

Sec. 30504. Reporting requirements

    (a) Junk Yard and Salvage Yard Operators.--
          (1) Beginning at a time established by the Attorney 
        General that is not sooner than the 3d month before the 
        establishment or designation of the National Motor 
        Vehicle Title Information System under section 30502 of 
        this title, an individual or entity engaged in the 
        business of operating a junk yard or salvage yard shall 
        file a monthly report with the operator of the System. 
        The report shall contain an inventory of all [junk 
        automobiles or salvage automobiles] nonrepairable 
        vehicles, rebuilt salvage vehicles, flood vehicles, or 
        salvage vehicles obtained by the junk yard or salvage 
        yard during the prior month. The inventory shall 
        contain--
                  (A) the vehicle identification number of each 
                automobile obtained;
                  (B) the date on which the automobile was 
                obtained;
                  (C) the name of the individual or entity from 
                whom the automobile was obtained; and
                  (D) a statement of whether the automobile was 
                crushed or disposed of for sale or other 
                purposes.
          (2) Paragraph (1) of this subsection does not apply 
        to an individual or entity--
                  (A) required by State law to report the 
                acquisition of [junk automobiles or salvage 
                automobiles] nonrepairable vehicles, rebuilt 
                salvage vehicles, flood vehicles, or salvage 
                vehicles to State or local authorities if those 
                authorities make that information available to 
                the operator; or
                  (B) issued a verification under section 33110 
                of this title stating that the automobile or 
                parts from the automobile are not reported as 
                stolen.
    (b) Insurance Carriers.--Beginning at a time established by 
the Attorney General that is not sooner than the 3d month 
before the establishment or designation of the System, an 
individual or entity engaged in business as an insurance 
carrier shall file a monthly report with the operator. The 
report may be filed directly or through a designated agent. The 
report shall contain an inventory of all automobiles of the 
current model year or any of the 4 prior model years that the 
carrier, during the prior month, has obtained possession of and 
has decided are [junk automobiles or salvage automobiles.] 
nonrepairable vehicles, rebuilt salvage vehicles, flood 
vehicles, or salvage vehicles. The inventory shall contain--
          (1) the vehicle identification number of each 
        automobile obtained;
          (2) the date on which the automobile was obtained;
          (3) the name of the individual or entity from whom 
        the automobile was obtained; and
          (4) the name of the owner of the automobile at the 
        time of the filing of the report.
    (c) Procedures and Practices.--The Attorney General shall 
establish by regulation procedures and practices to facilitate 
reporting in the least burdensome and costly fashion.

           *       *       *       *       *       *       *


    CHAPTER 333--AUTOMOBILE SAFETY AND TITLE DISCLOSURE REQUIREMENTS

Sec.
33301. Definitions.
33302. Passenger motor vehicle titling.
33303. Disclosure and label requirements on transfer of rebuilt salvage 
          vehicles.
33304. Report on funding.
33305. Effect on State law.
33306. Civil penalties.
33307. Actions by States.
33308. Incentive Grants.

Sec. 33301. Definitions

    (a) Definitions.--For the purposes of this chapter:
          (1) Passenger motor vehicle.--The term ``passenger 
        motor vehicle'' has the same meaning given such term by 
        section 32101(10), except, notwithstanding section 
        32101(9), it includes a multipurpose passenger vehicle 
        (constructed on a truck chassis or with special 
        features for occasional off-road operation), a truck, 
        other than a truck referred to in section 32101(10)(B), 
        and a pickup truck when that vehicle or truck is rated 
        by the manufacturer of such vehicle or truck at not 
        more than 10,000 pounds gross vehicle weight, and it 
        only includes a vehicle manufactured primarily for use 
        on public streets, roads, and highways.
          (2) Salvage vehicle.--The term ``salvage vehicle'' 
        means any passenger motor vehicle, other than a flood 
        vehicle or a nonrepairable vehicle, which--
                  (A) is a late model vehicle which has been 
                wrecked, destroyed, or damaged, to the extent 
                that the total cost of repairs to rebuild or 
                reconstruct the passenger motor vehicle to its 
                condition immediately before it was wrecked, 
                destroyed, or damaged, and for legal operation 
                on the roads or highways, exceeds 75 percent of 
                the retail value of the passenger motor vehicle 
                at the time it was wrecked, destroyed, or 
                damaged;
                  (B) is a late model vehicle which has been 
                wrecked, destroyed, or damaged, and to which an 
                insurance company acquires ownership pursuant 
                to a damage settlement (except in the case of a 
                settlement in connection with a recovered 
                stolen vehicle, unless such vehicle sustained 
                damage sufficient to meet the damage threshold 
                prescribed by subparagraph (A)); or
                  (C) the owner wishes to voluntarily designate 
                as a salvage vehicle by obtaining a salvage 
                title, without regard to the level of damage, 
                age, or value of such vehicle or any other factor, 
                except that such designation by the owner shall 
                not impose on the insurer of the passenger motor 
                vehicle or on an insurer processing a claim made 
                by or on behalf of the owner of the passenger motor 
                vehicle any obligation or liability.
        Notwithstanding any other provision of this chapter, a 
        State may use the term ``older model salvage vehicle'' 
        to designate a wrecked, destroyed, or damaged vehicle 
        that does not meet the definition of a late model 
        vehicle in paragraph (9). If a State has established or 
        establishes a salvage definition at a lesser percentage 
        than provided under subparagraph (A), then that 
        definition shall not be considered to be inconsistent 
        with the provisions of this chapter.
          (3) Salvage title.--The term ``salvage title'' means 
        a passenger motor vehicle ownership document issued by 
        the State to the owner of a salvage vehicle. A salvage 
        title shall be conspicuously labeled with the word 
        ``salvage'' across the front.
          (4) Rebuilt salvage vehicle.--The term ``rebuilt 
        salvage vehicle'' means--
                  (A) any passenger motor vehicle which was 
                previously issued a salvage title, has passed 
                State anti-theft inspection, has been issued a 
                certificate indicating that the passenger motor 
                vehicle has passed the required anti-theft 
                inspection, has passed the State safety 
                inspection in those States requiring a safety 
                inspection pursuant to section 33302(b)(8), has 
                been issued a certificate indicating that the 
                passenger motor vehicle has passed the required 
                safety inspection in those States requiring 
                such a safety inspection pursuant to section 
                33302(b)(8), and has a decal stating ``Rebuilt 
                Salvage Vehicle--Anti-theft and Safety 
                Inspections Passed'' affixed to the driver's 
                door jamb; or
                  (B) any passenger motor vehicle which was 
                previously issued a salvage title, has passed a 
                State anti-theft inspection, has been issued a 
                certificate indicating that the passenger motor 
                vehicle has passed the required anti-theft 
                inspection, and has, affixed to the driver's 
                door jamb, a decal stating ``Rebuilt Salvage 
                Vehicle--Anti-theft Inspection Passed/No Safety 
                Inspection Pursuant to National Criteria'' in 
                those States not requiring a safety inspection 
                pursuant to section 33302(b)(8).
          (5) Rebuilt salvage title.--The term ``rebuilt 
        salvage title'' means the passenger motor vehicle 
        ownership document issued by the State to the owner of 
        a rebuilt salvage vehicle. A rebuilt salvage title 
        shall be conspicuously labeled either with the words 
        ``Rebuilt Salvage Vehicle--Anti-theft and Safety 
        Inspections Passed'' or ``Rebuilt Salvage Vehicle--
        Anti-theft Inspection Passed/No Safety Inspection 
        Pursuant to National Criteria,'' as appropriate, across 
        the front.
          (6) Nonrepairable vehicle.--The term ``nonrepairable 
        vehicle'' means any passenger motor vehicle, other than 
        a flood vehicle, which is incapable of safe operation 
        for use on roads or highways and which has no resale 
        value except as a source of parts or scrap only or 
        which the owner irreversibly designates as a source of 
        parts or scrap. Such passenger motor vehicle shall be 
        issued a nonrepairable vehicle certificate and shall 
        never again be titled or registered.
          (7) Nonrepairable vehicle certificate.--The term 
        ``nonrepairable vehicle certificate'' means a passenger 
        motor vehicle ownership document issued by the State to 
        the owner of a nonrepairable vehicle. A nonrepairable 
        vehicle certificate shall be conspicuously labeled with 
        the word ``Nonrepairable'' across the front.
          (8) Secretary.--The term ``Secretary'' means the 
        Secretary of Transportation.
          (9) Late model vehicle.--The term ``Late Model 
        Vehicle'' means any passenger motor vehicle which--
                  (A) has a manufacturer's model year 
                designation of or later than the year in which 
                the vehicle was wrecked, destroyed, or damaged, 
                or any of the six preceding years; or
                  (B) has a retail value of more than $7,500.
        The Secretary shall adjust such retail value by $500 
        increments every 5 years beginning with an increase to 
        $8,000 on January 1, 2005.
          (10) Retail value.--The term ``retail value'' means 
        the actual cash value, fair market value, or retail 
        value of a passenger motor vehicle as--
                  (A) set forth in a current edition of any 
                nationally recognized compilation (to include 
                automated databases) of retail values; or
                  (B) determined pursuant to a market survey of 
                comparable vehicles with regard to condition 
                and equipment.
          (11) Cost of repairs.--The term ``cost of repairs'' 
        means the estimated retail cost of parts needed to 
        repair the vehicle or, if the vehicle has been 
        repaired, the actual retail cost of the parts used in 
        the repair, and the cost of labor computed by using the 
        hourly labor rate and time allocations that are 
        reasonable and customary in the automobile repair 
        industry in the community where the repairs are to be 
        performed.
          (12) Flood vehicle.--
                  (A) In general.--The term ``flood vehicle'' 
                means any passenger motor vehicle that--
                          (i) has been acquired by an insurance 
                        company as part of a damage settlement 
                        due to water damage; or
                          (ii) has been submerged in water to 
                        the point that rising water has reached 
                        over the door sill, has entered the 
                        passenger or trunk compartment, and has 
                        exposed any electrical, computerized, 
                        or mechanical component to water, 
                        except where a passenger motor vehicle 
                        which, pursuant to an inspection 
                        conducted by an insurance adjuster or 
                        estimator, a motor vehicle repairer or 
                        motor vehicle dealer in accordance with 
                        inspection guidelines or procedures 
                        established by the Secretary or the 
                        State, is determined--
                                  (I) to have no electrical, 
                                computerized, or mechanical 
                                components which were damaged 
                                by water; or
                                  (II) to have one or more 
                                electrical, computerized, or 
                                mechanical components which 
                                were damaged by water and where 
                                all such damaged components 
                                have been repaired or replaced.
                  (B) Inspection not required for all flood 
                vehicles.--No inspection under subparagraph (A) 
                shall be required unless the owner or insurer 
                of the passenger motor vehicle is seeking to 
                avoid a brand of ``Flood'' pursuant to this 
                chapter.
                  (C) Inspection must be by independent 
                party.--A motor vehicle repairer or motor 
                vehicle dealer may not carry out an inspection 
                under subparagraph (A) on a passenger motor 
                vehicle that has been repaired, or is to be 
                sold or leased, by that repairer or dealer.
                  (D) Effect of disclosure.--Disclosing a 
                passenger motor vehicle's status as a flood 
                vehicle or conducting an inspection pursuant to 
                subparagraph (A) shall not impose on any person 
                any liability for damage to (except in the case 
                of damage caused by the inspector at the time 
                of the inspection) or reduced value of a 
                passenger motor vehicle.
  (b) Construction.--The definitions set forth in subsection 
(a) only apply to vehicles in a State which are wrecked, 
destroyed, or otherwise damaged on or after the date on which 
such State complies with the requirements of this chapter and 
the rule promulgated pursuant to section 33302(b).

Sec. 33302. Passenger motor vehicle titling

  (a) Carry-Forward of State Information.--For any passenger 
motor vehicle, the ownership of which is transferred on or 
after the date that is 1 year after the date of the enactment 
of the National Salvage Motor Vehicle Consumer Protection Act 
of 1999, any State receiving funds under section 33308 of this 
chapter, in licensing such vehicle for use, shall disclose in 
writing on the certificate of title whenever records readily 
accessible to the State indicate that the passenger motor 
vehicle was previously issued a title that bore any word or 
symbol signifying that the vehicle was ``salvage'', ``older 
model salvage'', ``unrebuildable'', ``parts only'', ``scrap'', 
``junk'', ``nonrepairable'', ``reconstructed'', ``rebuilt'', or 
any other symbol or word of like kind, or that it has been 
damaged by flood, and the name of the State that issued that 
title.
  (b) Nationally Uniform Title Standards and Control Methods.--
Not later than 18 months after the date of the enactment of the 
National Salvage Motor Vehicle Consumer Protection Act of 1999, 
the Secretary shall by rule require any State receiving funds 
under section 33308 of this chapter, in licensing any passenger 
motor vehicle where ownership of such passenger motor vehicle 
is transferred more than 2 years after publication of such 
final rule, to apply uniform standards, procedures, and methods 
for the issuance and control of titles for motor vehicles and 
for information to be contained on such titles. Such titling 
standards, control procedures, methods, and information shall 
include the following requirements:
          (1) A State shall conspicuously indicate on the face 
        of the title or certificate for a passenger motor 
        vehicle, as applicable, if the passenger motor vehicle 
        is a salvage vehicle, a nonrepairable vehicle, a 
        rebuilt salvage vehicle, or a flood vehicle.
          (2) Such information concerning a passenger motor 
        vehicle's status shall be conveyed on any subsequent 
        title, including a duplicate or replacement title, for 
        the passenger motor vehicle issued by the original 
        titling State or any other State.
          (3) The title documents, the certificates, and decals 
        required by section 33301(4), and the issuing system 
        shall meet security standards minimizing the 
        opportunities for fraud.
          (4) The certificate of title shall include the 
        passenger motor vehicle make, model, body type, year, 
        odometer disclosure, and vehicle identification number.
          (5) The title documents shall maintain a uniform 
        layout, to be established in consultation with the 
        States or an organization representing them.
          (6) A passenger motor vehicle designated as 
        nonrepairable shall be issued a nonrepairable vehicle 
        certificate and shall not be retitled.
          (7) No rebuilt salvage title shall be issued to a 
        salvage vehicle unless, after the salvage vehicle is 
        repaired or rebuilt, it complies with the requirements 
        for a rebuilt salvage vehicle pursuant to section 
        33301(4). Any State inspection program operating under 
        this paragraph shall be subject to continuing review by 
        and approval of the Secretary. Any such anti-theft 
        inspection program shall include the following:
                  (A) A requirement that the owner of any 
                passenger motor vehicle submitting such vehicle 
                for an anti-theft inspection provide a 
                completed document identifying the vehicle's 
                damage prior to being repaired, a list of 
                replacement parts used to repair the vehicle, 
                and proof of ownership of such replacement 
                parts, as may be evidenced by bills of sale, 
                invoices, or, if such documents are not 
                available, other proof of ownership for the 
                replacement parts. The owner shall also include 
                an affirmation that the information in the 
                declaration is complete and accurate and that, 
                to the knowledge of the declarant, no stolen 
                parts were used during the rebuilding.
                  (B) A requirement to inspect the passenger 
                motor vehicle or any major part or any major 
                replacement part required to be marked under 
                section 33102 for signs of such mark or vehicle 
                identification number being illegally altered, 
                defaced, or falsified. Any such passenger motor 
                vehicle or any such part having a mark or 
                vehicle identification number that has been 
                illegally altered, defaced, or falsified, and 
                that cannot be identified as having been 
                legally obtained (through bills of sale, 
                invoices, or other ownership documentation), 
                shall be contraband and subject to seizure. The 
                Secretary, in consultation with the Attorney 
                General, shall, as part of the rule required by 
                this section, establish procedures for dealing 
                with those parts whose mark or vehicle 
                identification number is normally removed 
                during industry accepted remanufacturing or 
                rebuilding practices, which parts shall be 
                deemed identified for purposes of this section 
                if they bear a conspicuous mark of a type, and 
                applied in such a manner, as designated by the 
                Secretary, indicating that they have been rebuilt 
                or remanufactured. With respect to any vehicle part, 
                the Secretary's rule, as required by this section, 
                shall acknowledge that a mark or vehicle identification 
                number on such part may be legally removed or altered 
                as provided for in section 511 of title 18, United 
                States Code, and shall direct inspectors to adopt such 
                procedures as may be necessary to prevent the seizure 
                of a part from which the mark or vehicle identification 
                number has been legally removed or altered.
          (8) Any safety inspection for a rebuilt salvage 
        vehicle performed pursuant to this chapter shall be 
        performed in accordance with nationally uniform safety 
        inspection criteria established by the Secretary. A 
        State may determine whether to conduct such safety 
        inspection itself, contract with one or more third 
        parties, or permit self-inspection by a person licensed 
        by such State in an automotive-related business, all 
        subject to criteria promulgated by the Secretary 
        hereunder. Any State inspection program operating under 
        this paragraph shall be subject to continuing review by 
        and approval of the Secretary. A State requiring such 
        safety inspection may require the payment of a fee for 
        the privilege of such inspection or the processing 
        thereof.
          (9) No duplicate or replacement title shall be issued 
        unless the word ``duplicate'' is clearly marked on the 
        face thereof and unless the procedures for such 
        issuance are substantially consistent with 
        Recommendation three of the Motor Vehicle Titling, 
        Registration and Salvage Advisory Committee.
          (10) A State shall employ the following titling and 
        control methods:
                  (A) If an insurance company is not involved 
                in a damage settlement involving a salvage 
                vehicle or a nonrepairable vehicle, the 
                passenger motor vehicle owner shall apply for a 
                salvage title or nonrepairable vehicle 
                certificate, whichever is applicable, before 
                the passenger motor vehicle is repaired or the 
                ownership of the passenger motor vehicle is 
                transferred, but in any event within 30 days 
                after the passenger motor vehicle is damaged.
                  (B) If an insurance company, pursuant to a 
                damage settlement, acquires ownership of a 
                passenger motor vehicle that has incurred 
                damage requiring the vehicle to be titled as a 
                salvage vehicle or nonrepairable vehicle, the 
                insurance company or salvage facility or other 
                agent on its behalf shall apply for a salvage 
                title or nonrepairable vehicle certificate 
                within 30 days after the title is properly 
                assigned by the owner to the insurance company 
                and delivered to the insurance company or 
                salvage facility or other agent on its behalf 
                with all liens released.
                  (C) If an insurance company does not assume 
                ownership of an insured's or claimant's 
                passenger motor vehicle that has incurred 
                damage requiring the vehicle to be titled as a 
                salvage vehicle or nonrepairable vehicle, the 
                insurance company shall notify--
                          (i) the owner of the owner's 
                        obligation to apply for a salvage title 
                        or nonrepairable vehicle certificate 
                        for the passenger motor vehicle; and
                          (ii) the State passenger motor 
                        vehicle titling office that a salvage 
                        title or nonrepairable vehicle 
                        certificate should be issued for the 
                        vehicle,
                except to the extent such notification is 
                prohibited by State insurance law. The notices 
                shall be made in writing within 30 days after 
                the insurance company determines that the 
                damage will require a salvage title or a 
                nonrepairable certificate and that the vehicle 
                will be left with the owner.
                  (D) If a leased passenger motor vehicle 
                incurs damage requiring the vehicle to be 
                titled as a salvage vehicle or nonrepairable 
                vehicle, the lessor shall apply for a salvage 
                title or nonrepairable vehicle certificate 
                within 21 days after being notified by the 
                lessee that the vehicle has been so damaged, 
                except when an insurance company, pursuant to a 
                damage settlement, acquires ownership of the 
                vehicle. The lessee of such vehicle shall 
                inform the lessor that the leased vehicle has 
                been so damaged within 30 days after the 
                occurrence of the damage. Nothing in this 
                subparagraph requires that the requirements for 
                notification be contained in the lease itself, 
                as long as effective notice is provided by the 
                lessor to the lessee of the requirements.
                  (E) Any person acquiring ownership of a 
                damaged passenger motor vehicle that meets the 
                definition of a salvage or nonrepairable 
                vehicle for which a salvage title or 
                nonrepairable vehicle certificate has not been 
                issued, shall apply for a salvage title or 
                nonrepairable vehicle certificate, whichever is 
                applicable. This application shall be made 
                before the vehicle is further transferred, but 
                in any event, within 30 days after ownership is 
                acquired. The requirements of this subparagraph 
                shall not apply to any scrap metal processor 
                which acquires a passenger motor vehicle for 
                the sole purpose of processing it into prepared 
                grades of scrap and which so processes such 
                vehicle.
                  (F) State records shall note when a 
                nonrepairable vehicle certificate is issued. No 
                State shall issue a nonrepairable vehicle 
                certificate after 2 transfers of ownership.
                  (G) When a passenger motor vehicle has been 
                flattened, baled, or shredded, whichever comes 
                first, the title or nonrepairable vehicle 
                certificate for the vehicle shall be 
                surrendered to the State within 30 days. If the 
                second transferee on a nonrepairable vehicle 
                certificate is unequipped to flatten, bale, or 
                shred the vehicle, such transferee shall, at 
                the time of final disposal of the vehicle, use 
                the services of a professional automotive 
                recycler or professional scrap processor who is 
                hereby authorized to flatten, bale, or shred 
                the vehicle and to effect the surrender of the 
                nonrepairable vehicle certificate to the State 
                on behalf of such second transferee. State 
                records shall be updated to indicate the 
                destruction of such vehicle and no further 
                ownership transactions for the vehicle will be 
                permitted. If different than the State of 
                origin of the title or nonrepairable vehicle 
                certificate, the State of surrender shall notify 
                the State of origin of the surrender of the title 
                or nonrepairable vehicle certificate and of the 
                destruction of such vehicle.
                  (H) When a salvage title is issued, the State 
                records shall so note. No State shall permit 
                the retitling for registration purposes or 
                issuance of a rebuilt salvage title for a 
                passenger motor vehicle with a salvage title 
                without a certificate of inspection, which 
                complies with the security and guideline 
                standards established by the Secretary pursuant 
                to paragraphs (3), (7), and (8), as applicable, 
                indicating that the vehicle has passed the 
                inspections required by the State. This 
                subparagraph does not preclude the issuance of 
                a new salvage title for a salvage vehicle after 
                a transfer of ownership.
                  (I) After a passenger motor vehicle titled 
                with a salvage title has passed the inspections 
                required by the State, the inspection official 
                will affix the secure decal required pursuant 
                to section 33301(4) to the driver's door jamb 
                of the vehicle and issue to the owner of the 
                vehicle a certificate indicating that the 
                passenger motor vehicle has passed the 
                inspections required by the State. The decal 
                shall comply with the permanency requirements 
                established by the Secretary.
                  (J) The owner of a passenger motor vehicle 
                titled with a salvage title may obtain a 
                rebuilt salvage title or vehicle registration, 
                or both, by presenting to the State the salvage 
                title, properly assigned, if applicable, along 
                with the certificate that the vehicle has 
                passed the inspections required by the State. 
                With such proper documentation and upon 
                request, a rebuilt salvage title or 
                registration, or both, shall be issued to the 
                owner. When a rebuilt salvage title is issued, 
                the State records shall so note.
          (11) A seller of a passenger motor vehicle that 
        becomes a flood vehicle shall, prior to the time of 
        transfer of ownership of the vehicle, give the 
        transferee a written notice that the vehicle has been 
        damaged by flood, provided such person has actual 
        knowledge that such vehicle has been damaged by flood. 
        At the time of the next title application for the 
        vehicle, disclosure of the flood status shall be 
        provided to the applicable State with the properly 
        assigned title and the word ``Flood'' shall be 
        conspicuously labeled across the front of the new 
        title.
          (12) In the case of a leased passenger motor vehicle, 
        the lessee, within 15 days of the occurrence of the 
        event that caused the vehicle to become a flood 
        vehicle, shall give the lessor written disclosure that 
        the vehicle is a flood vehicle.
          (13) Ownership of a passenger motor vehicle may be 
        transferred on a salvage title, however, a passenger 
        motor vehicle for which a salvage title has been issued 
        shall not be registered for use on the roads or 
        highways unless it has been issued a rebuilt salvage 
        title.
          (14) Ownership of a passenger motor vehicle may be 
        transferred on a rebuilt salvage title, and a passenger 
        motor vehicle for which a rebuilt salvage title has 
        been issued may, if permitted by State law, be 
        registered for use on the roads and highways.
          (15) Ownership of a passenger motor vehicle may only 
        be transferred 2 times on a nonrepairable vehicle 
        certificate. A passenger motor vehicle for which a 
        nonrepairable vehicle certificate has been issued can 
        never be titled or registered for use on roads or 
        highways.
  (c) Electronic Procedures.--A State may employ electronic 
procedures in lieu of paper documents whenever such electronic 
procedures provide the same information, function, and security 
otherwise required by this section.
  (d) National Record of Compliant States.--The Secretary shall 
establish a record of the States which are in compliance with 
the requirements of subsections (a) and (b) of this section. 
The Secretary shall work with States to update this record upon 
the enactment of a State law which causes a State to come into 
compliance or become noncompliant with the requirements of 
subsections (a) and (b) of this section. Not later than 18 
months after the enactment of the National Salvage Motor 
Vehicle Consumer Protection Act of 1999, the Secretary shall 
establish a mechanism or mechanisms to identify to interested 
parties whether a State is in compliance with the requirements 
of subsections (a) and (b) of this section.

Sec. 33303. Disclosure and label requirements on transfer of rebuilt 
                    salvage vehicles

  (a) Written Disclosure Requirements.--
          (1) General rule.--Under regulations prescribed by 
        the Secretary of Transportation, a person transferring 
        ownership of a rebuilt salvage vehicle shall, prior to 
        the time of transfer of ownership of the vehicle, give 
        the transferee a written disclosure that the vehicle is 
        a rebuilt salvage vehicle when such person has actual 
        knowledge of the status of such vehicle.
          (2) False statement.--A person making a written 
        disclosure required by a regulation prescribed under 
        paragraph (1) of this subsection may not make a false 
        statement in the disclosure.
          (3) Completeness.--A person acquiring a rebuilt 
        salvage vehicle for resale may accept a disclosure 
        under paragraph (1) only if it is complete.
          (4) Regulations.--The regulations prescribed by the 
        Secretary shall provide the way in which information is 
        disclosed and retained under paragraph (1).
  (b) Label Requirements.--
          (1) In general.--The Secretary shall by regulation 
        require that a label be affixed to the windshield or 
        window of a rebuilt salvage vehicle before its first 
        sale at retail containing such information regarding 
        that vehicle as the Secretary may require. The label 
        shall be affixed by the individual who conducts the 
        applicable State antitheft inspection in a 
        participating State.
          (2) Removal, alteration, or illegibility of required 
        label.--No person shall willfully remove, alter, or 
        render illegible any label required by paragraph (1) 
        affixed to a rebuilt salvage vehicle before the vehicle 
        is delivered to the actual custody and possession of 
        the first retail purchaser.
  (c) Limitation.--The requirements of subsections (a) and (b) 
shall only apply to a transfer of ownership of a rebuilt 
salvage vehicle where such transfer occurs in a State which, at 
the time of the transfer, is complying with subsections (a) and 
(b) of section 33302.

Sec. 33304. Report on funding

  The Secretary shall, contemporaneously with the issuance of a 
final rule pursuant to section 33302(b), report to appropriate 
committees of Congress whether the costs to the States of 
compliance with such rule can be met by user fees for issuance 
of titles, issuance of registrations, issuance of duplicate 
titles, inspection of rebuilt vehicles, or for the State 
services, or by earmarking any moneys collected through law 
enforcement action to enforce requirements established by such 
rule.

Sec. 33305. Effect on State law

  (a) In General.--Unless a State is in compliance with 
subsection (c) of section 33302, effective on the date the rule 
promulgated pursuant to section 33302 becomes effective, the 
provisions of this chapter shall preempt all State laws such a 
State that receives funds under section 33308 of this chapter, 
to the extent they are inconsistent with the provisions of this 
chapter or the rule promulgated pursuant to section 33302, 
which--
          (1) set forth the form of the passenger motor vehicle 
        title;
          (2) define, in connection with a passenger motor 
        vehicle (but not in connection with a passenger motor 
        vehicle part or part assembly separate from a passenger 
        motor vehicle), any term defined in section 33301 or 
        the terms ``salvage'', ``nonrepairable'', or ``flood'', 
        or apply any of those terms to any passenger motor 
        vehicle (but not to a passenger motor vehicle part or 
        part assembly separate from a passenger motor vehicle); 
        or
          (3) set forth titling, recordkeeping, anti-theft 
        inspection, or control procedures in connection with 
        any salvage vehicle, rebuilt salvage vehicle, 
        nonrepairable vehicle, or flood vehicle.
  (b) Exceptions.--
          (1) Passenger motor vehicle; older model salvage.--
        Subsection (a)(2) does not preempt State use of the 
        term--
                  (A) ``passenger motor vehicle'' in statutes 
                not related to titling, recordkeeping, anti-
                theft inspection, or control procedures in 
                connection with any salvage vehicle, rebuilt 
                salvage vehicle, nonrepairable vehicle, or 
                flood vehicle ; or
                  (B) ``older model salvage'' to designate a 
                wrecked, destroyed, or damaged vehicle that is 
                older than a late model vehicle.
          (2) Private law actions.--Nothing in this chapter may 
        be construed to affect any private right of action 
        under State law.
  (c) Construction.--Additional disclosures of a passenger 
motor vehicle's title status or history, in addition to the 
terms defined in section 33301, shall not be deemed 
inconsistent with the provisions of this chapter. Such 
disclosures shall include disclosures made on a certificate of 
title. When used in connection with a passenger motor vehicle 
(but not in connection with a passenger motor vehicle part or 
part assembly separate from a passenger motor vehicle), any 
definition of a term defined in section 33301 which is 
different than the definition in that section or any use of any 
term listed in subsection (a), but not defined in section 
33301, shall be deemed inconsistent with the provisions of this 
chapter. Nothing in this chapter shall preclude a State from 
disclosing on a rebuilt salvage title that a rebuilt salvage 
vehicle has passed a State safety inspection which differed 
from the nationally uniform criteria to be promulgated pursuant 
to section 33302(b)(8).

Sec. 33306. Civil penalties

  (a) Prohibited Acts.--It is unlawful for any person knowingly 
to--
          (1) make or cause to be made any false statement on 
        an application for a title (or duplicate title) for a 
        passenger motor vehicle or any disclosure made pursuant 
        to section 33303;
          (2) fail to apply for a salvage title when such an 
        application is required;
          (3) alter, forge, or counterfeit a certificate of 
        title (or an assignment thereof), a nonrepairable 
        vehicle certificate, a certificate verifying an anti-
        theft inspection or an anti-theft and safety 
        inspection, a decal affixed to a passenger motor 
        vehicle pursuant to section 33302(b)(10)(I), or any 
        disclosure made pursuant to section 33303;
          (4) falsify the results of, or provide false 
        information in the course of, an inspection conducted 
        pursuant to section 33302(b)(7) or (8);
          (5) offer to sell any salvage vehicle or 
        nonrepairable vehicle as a rebuilt salvage vehicle;
          (6) fail to make any disclosure required by section 
        33302(b)(11);
          (7) fail to make any disclosure required by section 
        33303;
          (8) violate a regulation prescribed under this 
        chapter;
          (9) move a vehicle or a vehicle title in interstate 
        commerce for the purpose of avoiding the titling 
        requirements of this chapter; or
          (10) conspire to commit any of the acts enumerated in 
        paragraph (1), (2), (3), (4), (5), (6), (7), (8), or 
        (9).
  (b) Civil Penalty.--Any person who commits an unlawful act as 
provided in subsection (a) of this section shall be fined a 
civil penalty of up to $2,000 per offense. A separate violation 
occurs for each passenger motor vehicle involved in the 
violation.

Sec. 33307. Actions by States

  (a) In General.--When a person violates any provision of this 
chapter, the chief law enforcement officer of the State in 
which the violation occurred may bring an action--
          (1) to restrain the violation;
          (2) recover amounts for which a person is liable 
        under section 33306; or
          (3) to recover the amount of damage suffered by any 
        resident in that State who suffered damage as a result 
        of the knowing commission of an unlawful act under 
        section 33306(a) by another person.
  (b) Statute of Limitations.--An action under subsection (a) 
shall be brought in any court of competent jurisdiction within 
2 years after the date on which the violation occurs.
  (c) Notice.--The State shall serve prior written notice of 
any action under subsection (a) or (f)(2) upon the Attorney 
General of the United States and provide the Attorney General 
with a copy of its complaint, except that if it is not feasible 
for the State to provide such prior notice, the State shall 
serve such notice immediately upon instituting such action. 
Upon receiving a notice respecting an action, the Attorney 
General shall have the right--
          (1) to intervene in such action;
          (2) upon so intervening, to be heard on all matters 
        arising therein; and
          (3) to file petitions for appeal.
  (d) Construction.--For purposes of bringing any action under 
subsection (a), nothing in this Act shall prevent an attorney 
general from exercising the powers conferred on the attorney 
general by the laws of such State to conduct investigations or 
to administer oaths or affirmations or to compel the attendance 
of witnesses or the production of documentary and other 
evidence.
  (e) Venue; Service of Process.--Any action brought under 
subsection (a) in a district court of the United States may be 
brought in the district in which the defendant is found, is an 
inhabitant, or transacts business or wherever venue is proper 
under section 1391 of title 28, United States Code. Process in 
such an action may be served in any district in which the 
defendant is an inhabitant or in which the defendant may be 
found.
  (f) Actions by State Officials.--
          (1) Nothing contained in this section shall prohibit 
        an attorney general of a State or other authorized 
        State official from proceeding in State court on the 
        basis of an alleged violation of any civil or criminal 
        statute of such State, including those related to 
        consumer protection.
          (2) In addition to actions brought by an attorney 
        general of a State under subsection (a), such an action 
        may be brought by officers of such State who are 
        authorized by the State to bring actions in such State 
        on behalf of its residents.

Sec. 33308. Incentive Grants

  (a) General Authority.--The Secretary of Transportation shall 
make a grant to each State that demonstrates to the 
satisfaction of the Secretary that it is taking appropriate 
actions to implement the provisions of this chapter.
  (b) Grants.--Pursuant to subsection (a), a grant to carry out 
this chapter in a fiscal year shall be provided to each 
qualifying State in an amount determined by multiplying--
          (1) the amount authorized for the fiscal year to 
        carry out this chapter, by
          (2) the ratio that the amount of funds apportioned to 
        each qualifying State under section 402 of title 23, 
        United States Code, for the fiscal year bears to the 
        total amount of funds apportioned to all qualifying 
        States under section 402 of title 23, United States 
        Code, for such fiscal year, except that no State 
        eligible for a grant under this paragraph shall receive 
        less than $250,000.
  (c) Use of Grants.--Any State that receives a grant under 
this section shall use the funds to carry out the provisions of 
this chapter, including such conformance related activities as 
issuing titles, establishing and administering vehicle theft or 
salvage vehicles safety inspections, enforcement, and other 
related purposes.
  (d) Authorization of Appropriations.--
          (1) In general.--There is authorized to be 
        appropriated to carry out this chapter $16,000,000 for 
        fiscal year 2000.
          (2) Availability of funds.--Funds authorized by this 
        section shall remain available until expended.

                                  
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