S.F. _____ Section 1. Section 321.52, subsection 4, paragraph a, Code 1 2011, is amended to read as follows: 2 a. A vehicle rebuilder or a person engaged in the business 3 of buying, selling, or exchanging vehicles of a type required 4 to be registered in this state, upon acquisition of a wrecked 5 or salvage vehicle, shall surrender the certificate of 6 title or manufacturer’s or importer’s statement of origin 7 properly assigned, together with an application for a salvage 8 certificate of title, to the county treasurer of the county of 9 residence of the purchaser or transferee within thirty days 10 after the date of assignment of the certificate of title for 11 the wrecked or salvage motor vehicle. This subsection applies 12 only to vehicles with a fair market value of five hundred 13 dollars or more, based on the value before the vehicle became 14 wrecked or salvage. Upon payment of a fee of ten dollars, the 15 county treasurer shall issue a salvage certificate of title 16 which shall bear the word “SALVAGE” stamped or printed on the 17 face of the title in a manner prescribed by the department. A 18 salvage certificate of title may be assigned to an educational 19 institution , ; a new motor vehicle dealer licensed under chapter 20 322 , ; a person engaged in the business of purchasing bodies, 21 parts of bodies, frames , or component parts of vehicles for 22 sale as scrap metal , ; or a salvage pool , or an authorized 23 vehicle recycler licensed under chapter 321H . An A salvage 24 pool licensed under chapter 321H may reassign, or an authorized 25 vehicle recycler licensed under chapter 321H or a new motor 26 vehicle dealer licensed under chapter 322 may assign or 27 reassign an Iowa salvage certificate of title or a salvage 28 certificate of title from another state to any person, and the 29 provisions of section 321.24, subsection 5 , requiring issuance 30 of an Iowa salvage certificate of title shall not apply. A 31 vehicle on which ownership has transferred to an insurer of 32 the vehicle as a result of a settlement with the owner of the 33 vehicle arising out of damage to, or unrecovered theft of, the 34 vehicle shall be deemed to be a wrecked or salvage vehicle 35 -1- LSB 2177SC (5) 84 dea/nh 1/ 7

S.F. _____ and the insurer shall comply with this subsection to obtain a 1 salvage certificate of title within thirty days after the date 2 of assignment of the certificate of title of the vehicle. 3 Sec. 2. Section 321H.2, Code 2011, is amended by adding the 4 following new subsection: 5 NEW SUBSECTION . 01. “At retail” means to dispose of a motor 6 vehicle to a person who will devote it to a consumer use. 7 Sec. 3. Section 321H.2, subsection 3, Code 2011, is amended 8 to read as follows: 9 3. “Extension” means a place of business of an authorized 10 vehicle recycler or salvage pool other than the principal 11 place of business within the county of the principal place of 12 business. 13 Sec. 4. Section 321H.2, Code 2011, is amended by adding the 14 following new subsection: 15 NEW SUBSECTION . 4A. “Salvage pool” means as defined in 16 section 321.1. 17 Sec. 5. Section 321H.3, Code 2011, is amended to read as 18 follows: 19 321H.3 Prohibitions. 20 1. Except for educational institutions; persons licensed 21 as new vehicle dealers under chapter 322 ; persons engaged in 22 a hobby not for profit; persons engaged in the business of 23 purchasing bodies, parts of bodies, frames, or component parts 24 of vehicles only for sale as scrap metal; or persons licensed 25 under the provisions of this chapter as authorized vehicle 26 recyclers or salvage pools , a person in this state shall not 27 engage in the business of any of the following: 28 1. a. Selling or offering for sale used bodies, parts 29 of bodies, frames, or component parts of more than six used 30 vehicles subject to registration in a twelve-month period. 31 2. b. Dismantling, scrapping, recycling, or salvaging more 32 than six vehicles subject to registration in a twelve-month 33 period. 34 3. c. Rebuilding or restoring for sale more than six 35 -2- LSB 2177SC (5) 84 dea/nh 2/ 7

S.F. _____ wrecked or salvage vehicles subject to registration in a 1 twelve-month period. 2 4. d. Storing more than six vehicles not currently 3 registered or storing damaged vehicles except where such 4 storing of damaged vehicles is incidental to the primary 5 purpose of the repair of vehicles for others. 6 2. a. A person who is licensed as an authorized vehicle 7 recycler shall not be licensed as and shall not engage in the 8 business of a salvage pool. 9 b. A person who has been issued a salvage pool license shall 10 not do any of the following: 11 (1) Be licensed as an authorized vehicle recycler. 12 (2) Engage in the business of a vehicle rebuilder, a used 13 vehicle parts dealer, or a vehicle salvager. 14 (3) Engage in the business of selling vehicles at retail. 15 Sec. 6. NEW SECTION . 321H.4A Salvage pool licensure. 16 1. A person shall not engage in business as a salvage pool 17 in this state without first obtaining a license as provided in 18 this section. 19 2. a. Application for a salvage pool license shall be 20 made to the department on forms provided by the department. 21 The application shall be accompanied by a fee of seventy 22 dollars for a two-year period or part thereof. The license 23 shall be approved or disapproved within thirty days after 24 application for the license. A license expires on December 31 25 of even-numbered years. A licensee shall have the month of 26 expiration and the month after the month of expiration to renew 27 the license. A person who fails to renew a license by the end 28 of this time period and desires to hold a license shall file a 29 new license application and pay the required fee. A separate 30 license shall be obtained for each county in which the licensee 31 conducts salvage pool operations. 32 b. The applicant shall demonstrate that the applicant will 33 have the facilities and equipment necessary to engage in the 34 business of a salvage pool. 35 -3- LSB 2177SC (5) 84 dea/nh 3/ 7

S.F. _____ c. The applicant shall certify that the applicant does not 1 hold a license to operate as an authorized vehicle recycler 2 and does not engage in business as a vehicle rebuilder, a used 3 vehicle parts dealer, or a vehicle salvager. 4 3. Each licensee shall file with the department a 5 supplemental statement form when the licensee’s principal place 6 of business, an extension, or the operation of business in the 7 county is changed to differ from the information contained on 8 the initial license application form at least ten days prior 9 to the change. The department shall notify each licensee of 10 the approval of a change in license status. If a change in 11 license status is approved by the department, the licensee 12 shall surrender the old license to the department together with 13 a thirty-five dollar fee. The department shall issue a new 14 license modified to reflect the principal place of business, 15 each extension, and the operations of the licensee. 16 4. a. A salvage pool license authorizes the licensee 17 to store and display wrecked or salvage vehicles for resale 18 and solicit bids for the sale of such vehicles on behalf 19 of insurance companies, lenders, or licensed motor vehicle 20 dealers. A salvage pool may reassign the salvage certificate 21 of title as provided in section 321.52, subsection 4, paragraph 22 “a” . 23 b. As a condition of the license issued under this section, 24 a salvage pool licensee shall comply with all local zoning 25 requirements and local ordinances applicable to the operation 26 of the salvage pool business. 27 Sec. 7. Section 321H.8, subsection 2, Code 2011, is amended 28 to read as follows: 29 2. A person who has been convicted of a fraudulent practice, 30 has been convicted of three or more violations of section 31 321.92, subsection 2 , or section 321.99 , or has been convicted 32 of any indictable offense in connection with selling or other 33 activity relating to vehicles, in this state or any other 34 state, shall not for a period of five years from the date 35 -4- LSB 2177SC (5) 84 dea/nh 4/ 7

S.F. _____ of conviction be an owner, salesperson, employee, officer of 1 a corporation, or representative of an authorized vehicle 2 recycler or a licensed salvage pool or represent themselves as 3 an owner, salesperson, employee, officer of a corporation, or 4 representative of an authorized vehicle recycler or a licensed 5 salvage pool . 6 EXPLANATION 7 This bill establishes licensing requirements and licensing 8 fees for vehicle salvage pools. 9 “Salvage pool” is defined as the business of selling wrecked 10 or salvage vehicles at auction. Under the bill, a person is 11 prohibited from engaging in the business of a salvage pool 12 without obtaining a license. The licensing application process 13 mirrors the process currently established for authorized 14 vehicle recyclers. The fee for a two-year license is $70, and 15 a separate application is required for each county in which the 16 licensee conducts salvage pool operations. Licenses expire 17 on December 31 of even-numbered years, with a one-month grace 18 period for renewal. License fees are credited to the road use 19 tax fund. 20 As a condition for licensure, an applicant must demonstrate 21 that the applicant will have the necessary facilities and 22 equipment to engage in the salvage pool business. In addition, 23 the applicant must certify to the department that the applicant 24 does not hold a license to operate as an authorized vehicle 25 recycler and does not engage in the business of a vehicle 26 rebuilder, used vehicle parts dealer, or vehicle salvager. The 27 bill prohibits a person from being licensed as both a salvage 28 pool and an authorized vehicle recycler, and a salvage pool 29 licensee may not sell vehicles at retail. 30 A licensee is required to notify the department whenever 31 there is a change in the location of the principal place of 32 business, an extension location, or the operation of the 33 business within a county. If the change in status is approved 34 by the department, a new license is issued upon payment of a 35 -5- LSB 2177SC (5) 84 dea/nh 5/ 7

S.F. _____ $35 fee. 1 The bill specifies that a salvage pool licensee is 2 authorized to act on behalf of sellers who are insurance 3 companies, lenders, or licensed motor vehicle dealers by 4 storing and displaying wrecked or salvage vehicles for 5 resale or soliciting bids for the sale of those vehicles. To 6 facilitate the sale, a salvage pool may reassign the salvage 7 certificate of title to a person who is allowed, under current 8 law, to take title to a wrecked or salvage vehicle. The list of 9 persons who may be assigned such a title include educational 10 institutions; new motor vehicle dealers; persons engaged in 11 the business of purchasing bodies, parts of bodies, frames, or 12 component parts of vehicles for sale as scrap metal; authorized 13 vehicle recyclers; or persons from other states who are 14 licensed or authorized in their home state to purchase wrecked 15 or salvage vehicles. A salvage pool licensee is required to 16 comply with zoning requirements and local ordinances applicable 17 to the business. 18 The department may deny, revoke, or suspend a salvage 19 pool license for the same reasons currently applicable 20 for authorized vehicle recycler licenses. Those reasons 21 are: violations of the licensing provisions; material 22 misrepresentation in connection with an application for 23 a license, certificate, or registration; conviction of a 24 fraudulent practice or any indictable offense in connection 25 with selling or other activity relating to vehicles; three 26 or more convictions for certain offenses relating to vehicle 27 identification numbers and registrations; failure to maintain 28 an established principal place of business without notifying 29 the department; previous license denial, suspension, or 30 revocation within the last three years; or a final judgment of 31 a court that the person committed consumer fraud in connection 32 with selling or other activity relating vehicles. 33 A violation of the salvage pool licensing provisions is 34 a serious misdemeanor. A serious misdemeanor is punishable 35 -6- LSB 2177SC (5) 84 dea/nh 6/ 7

S.F. _____ by confinement for no more than one year and a fine of at 1 least $315 but not more than $1,875. A person convicted of 2 a fraudulent practice, three or more violations relating to 3 vehicle identification or registration, or any indictable 4 offense in connection with selling or other activity relating 5 to vehicles is prohibited from being or representing themselves 6 as an owner, salesperson, employee, corporate officer, or 7 representative of a salvage pool for five years from the date 8 of conviction. 9 -7- LSB 2177SC (5) 84 dea/nh 7/ 7