BILL ANALYSIS                                                                                                                                                                                                    

                                                                     AB 287

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          287 (Gordon, et al.)

          As Amended  August 19, 2016

          Majority vote

          |ASSEMBLY:  |      |(June 2, 2015) |SENATE: |39-0  |(August 23,      |
          |           |      |               |        |      |2016)            |
          |           |      |               |        |      |                 |
          |           |      |               |        |      |                 |
                 (vote not relevant)

          Original Committee Reference:  TRANS.

          SUMMARY:  Enacts the Consumer Automotive Recall Safety Act  
          (Act), which would prohibit a dealer or car rental company from  
          loaning or renting a vehicle is subject to a recall until the  
          repair has been made.

          The Senate amendments largely delete the language passed by the  
          Assembly, and would instead: 

          1)Require the warranty reimbursement schedule or formula used by  
            every franchisor to be reasonable with respect to the time and  
            compensation allowed to the franchisee for costs directly  
            associated with the disposal of hazardous materials that are  
            associated with a recall repair.


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          2)Authorize the Department of Motor Vehicles (DMV) to suspend a  
            dealer's license for violation of any provision of the Act, or  
            any rule or regulation adopted pursuant thereto.

          3)Require that, no later than 48 hours after receiving notice of  
            a manufacturer's recall or sooner if practicable, a dealer or  
            rental car company with a motor vehicle fleet of 34 or fewer  
            loaner or rental vehicles shall not loan, rent, or offer for  
            loan or rent a vehicle subject to that recall until the recall  
            repair has been made.

          4)Authorize the dealer or rental car company, if a recall  
            notification indicates that the remedy for the recall is not  
            immediately available and specifies actions to temporarily  
            repair the vehicle in a manner to eliminate the safety risk  
            that prompted the recall, to loan or rent the vehicle after  
            having the repairs completed. 

          5)Prohibit the dealer or rental car company from loaning or  
            renting the vehicle until the vehicle has been repaired, once  
            the remedy for the vehicle becomes available to the dealer or  
            rental car company. 

          6)Require DMV to include in each vehicle registration renewal  
            notice the following recall disclosure statement:

          NOTICE:  Many vehicles have been recalled recently for needed  
          repairs.  Did you know you can check to see if your vehicle has  
          an unrepaired manufacturer's safety recall?  For most vehicles,  
          manufacturer's safety recalls are repaired for free.  You can  
          check for any recalls and how to get the recall repaired at  

          7)Define the terms "warranty," "dealer," "manufacturer's  
            recall," "recall database," "recall database report," and  
            "rental car company."


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          8)Revise the legislative findings and declarations 

          9)Declare that the Act does not create any legal duty upon the  
            dealer, rental car company, or department related to the  
            accuracy, errors, or omissions contained in a recall database  
            report or any legal duty to provide information added to a  
            recall database after the dealer, rental car company, or  
            department obtained the recall database report.

          10)Declare that the rights and remedies provided by the Act are  
            cumulative and shall not be construed as restricting any right  
            or remedy that is otherwise available. 

          11)Declare the provisions of the Act to be severable. 

          12)Declare that no reimbursement is required pursuant to the  
            California Constitution because the only costs that may be  
            incurred by a local agency or school district will be incurred  
            because this bill creates a new crime or infraction,  
            eliminates a crime or infraction, changes the penalty for a  
            crime or infraction, or changes the definition of a crime.

          13)Make other clarifying or nonsubstantive changes.

          FISCAL EFFECT:  According to the Senate Appropriations  

          1)Likely minor one-time DMV costs, potentially as high as  
            $50,000, related to the printing of the recall disclosure  
            statement on vehicle registration renewal documents.  Ongoing  
            administrative costs would be minor and absorbable.  (Motor  
            Vehicle Account)
          2)Potential DMV costs beginning in 2017-18 for ongoing  
            dealership inspections and enforcement activities.  Staff  
            estimates any additional activities would result in minor  


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            costs. (Motor Vehicle Account)

          COMMENTS:  This bill is intended to address the danger posed by  
          consumers driving cars with unknown or unremedied recall notices  
          by requiring smaller dealers and rental car companies (those  
          with fleets of 34 or fewer cars) to ground automobiles with  
          outstanding recall notices no later than 48 hours after receipt  
          of notice, and either fix or temporarily repair the car before  
          making it available to a consumer.    

          Analysis Prepared by:                                             
                          Hank Dempsey / P. & C.P. / (916) 319-2200  FN: