Senate File 423 - Introduced SENATE FILE 423 BY COMMITTEE ON TRANSPORTATION (SUCCESSOR TO SF 354) A BILL FOR An Act relating to the fee for new registration for repaired 1 salvage vehicles, and including effective date provisions. 2 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 3 TLSB 2420SV (3) 86 ns/nh

S.F. 423 Section 1. Section 321.105A, subsection 2, paragraph c, 1 subparagraph (17), Code 2015, is amended by striking the 2 subparagraph and inserting in lieu thereof the following: 3 (17) Vehicles titled under a salvage certificate of 4 title. However, when such a vehicle has been repaired and 5 a regular certificate of title is applied for, the fee for 6 new registration is due. If the owner of the vehicle is 7 not licensed as a motor vehicle dealer, the fee for new 8 registration shall be equal to two percent of the value of 9 the vehicle as determined by the department, with deductions 10 allowed for the cost of parts, supplies, and equipment for 11 which sales tax was paid and which were used to rebuild 12 the vehicle. The department shall adopt rules to determine 13 how such deductions shall be documented. The fee for new 14 registration pursuant to this subparagraph (17) shall be 15 automatically reduced in the following amounts, as applicable: 16 (a) If the motor vehicle is seven model years old or older, 17 but newer than nine model years old, one-fourth of one percent 18 of the value of the vehicle as determined by the department, 19 taking into account the deductions applied for the cost of 20 parts, supplies, and equipment for which sales tax was paid and 21 which were used to rebuild the vehicle. 22 (b) If the motor vehicle is nine model years old or older, 23 but newer than twelve model years old, three-fourths of one 24 percent of the value of the vehicle as determined by the 25 department, taking into account the deductions applied for the 26 cost of parts, supplies, and equipment for which sales tax was 27 paid and which were used to rebuild the vehicle. 28 (c) If the motor vehicle is twelve model years old or 29 older, one and one-half percent of the value of the vehicle 30 as determined by the department, taking into account the 31 deductions applied for the cost of parts, supplies, and 32 equipment for which sales tax was paid and which were used to 33 rebuild the vehicle. 34 Sec. 2. EFFECTIVE DATE. This Act takes effect January 1, 35 -1- LSB 2420SV (3) 86 ns/nh 1/ 3

S.F. 423 2016. 1 EXPLANATION 2 The inclusion of this explanation does not constitute agreement with 3 the explanation’s substance by the members of the general assembly. 4 Current law provides that a vehicle titled under a 5 salvage certificate of title is exempt from the fee for new 6 registration until the vehicle is repaired and a regular 7 certificate of title is applied for. If the owner of the 8 vehicle is a licensed recycler, but not licensed as a vehicle 9 dealer, the fee for new registration applies based on the fair 10 market value of the vehicle, with deduction allowed for the 11 cost of parts, supplies, and equipment for which sales tax 12 was paid and which were used to rebuild the vehicle. If the 13 owner is a person who is not licensed as a recycler or vehicle 14 dealer, the fee for new registration applies based on the fair 15 market value of the vehicle, with deduction allowed for the 16 cost of parts, frames, chassis, auto bodies, or supplies that 17 were purchased to rebuild the vehicle and for which sales tax 18 was paid. 19 The bill strikes these provisions but continues to provide 20 that a vehicle titled under a salvage certificate of title is 21 exempt from the fee for new registration until the vehicle is 22 repaired and a regular certificate of title is applied for. 23 The bill provides that if the owner of the vehicle is 24 not licensed as a motor vehicle dealer, the fee for new 25 registration shall be equal to 2 percent of the value of 26 the vehicle as determined by the department, with deductions 27 allowed for the cost of parts, supplies, and equipment for 28 which sales tax was paid and which were used to rebuild 29 the vehicle. The bill provides that the department of 30 transportation shall adopt rules to determine how such 31 deductions shall be documented. 32 The bill provides that the fee for new registration shall be 33 automatically reduced in certain circumstances. If the motor 34 vehicle is seven model years old or older, but newer than nine 35 -2- LSB 2420SV (3) 86 ns/nh 2/ 3

S.F. 423 model years old, the fee for new registration is reduced 0.25 1 percent of the value of the vehicle. If the motor vehicle is 2 nine model years old or older, but newer than 12 model years 3 old, the fee for new registration is reduced 0.75 percent of 4 the value of the vehicle. If the motor vehicle is 12 model 5 years old or older, the fee for new registration is reduced 1.5 6 percent of the value of the vehicle. For these reductions, the 7 value of the vehicle is determined by the department, taking 8 into account the deductions applied for the cost of parts, 9 supplies, and equipment for which sales tax was paid and which 10 were used to rebuild the vehicle. 11 The bill takes effect January 1, 2016. 12 -3- LSB 2420SV (3) 86 ns/nh 3/ 3