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[Congressional Bills 104th Congress]
[From the U.S. Government Publishing Office]
[S. 2030 Introduced in Senate (IS)]

104th CONGRESS
  2d Session
                                S. 2030

To establish nationally uniform requirements regarding the titling and 
 registration of salvage, nonrepairable, and rebuilt vehicles, and for 
                            other purposes.

_______________________________________________________________________

                   IN THE SENATE OF THE UNITED STATES

                             August 2, 1996

  Mr. Lott (for himself and Mr. Exon) introduced the following bill; 
    which was read twice and referred to the Committee on Commerce, 
                      Science, and Transportation

_______________________________________________________________________

                                 A BILL

 
To establish nationally uniform requirements regarding the titling and 
 registration of salvage, nonrepairable, and rebuilt vehicles, and for 
                            other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``National Motor Vehicle Safety, 
Antitheft, Title Reform, and Consumer Protection Act of 1996''.

SEC. 2. FINDINGS.

    The Congress finds that--
            (1) many States do not have specific requirements regarding 
        the disclosure of the salvage history of a motor vehicle and 
        some States never require that the title to a motor vehicle be 
        stamped or branded to indicate that the motor vehicle is, or 
        has been, a salvage vehicle;
            (2) as of the date of enactment of this Act, State 
        disclosure requirements regarding the salvage history of a 
        motor vehicle--
                    (A) are inconsistent in scope and content;
                    (B) require the use of different forms and 
                administrative procedures;
                    (C) will undercut the effectiveness of the National 
                Automobile Title Information System created by the Anti 
                Car Theft Act of 1992;
                    (D) are burdensome on interstate commerce; and
                    (E) do not provide a significant deterrent to 
                unscrupulous sellers of rebuilt vehicles who mislead 
                potential wholesale and retail buyers concerning the 
                condition and value of such vehicles;
            (3) the fact that a motor vehicle is salvage, 
        nonrepairable, water damaged, or rebuilt after incurring 
        substantial damage is material in any subsequent purchase or 
        sale of that motor vehicle;
            (4) some salvage and nonrepairable vehicles become involved 
        in illegal commerce in stolen vehicles and parts;
            (5) in some jurisdictions, the lack of theft inspections 
        prior to allowing a rebuilt motor vehicle back on the road 
        provides an opportunity for an unscrupulous person to use 
        stolen parts in the rebuilding of motor vehicles;
            (6) according to the National Highway Traffic Safety 
        Administration, rebuilt motor vehicles--
                    (A) may not have passed any safety inspection; and
                    (B) may pose a public safety risk and consumers who 
                unknowingly buy rebuilt motor vehicles face an 
                increased risk of death or serious injury;
            (7) statistics prepared by the American Association of 
        Motor Vehicle Administrators indicate that 71 percent of the 
        States require some form of safety inspection before a rebuilt 
        salvage vehicle may be registered for use on the road;
            (8) the promulgation of a safety inspection program by the 
        Secretary of Transportation may assist the States in expanding 
        and standardizing their inspection programs for rebuilt 
        vehicles;
            (9) duplicate or replacement titles play an important role 
        in many vehicle thefts and various types of vehicle fraud;
            (10) State controls on the issuance of such titles must 
        therefore be strengthened and made uniform across the United 
        States;
            (11) large quantities of motor vehicles are exported from 
        United States ports to foreign countries without proper 
        documentation of ownership in violation of applicable law; and
            (12) in view of the threats to public safety and consumer 
        interests described in paragraphs (1) through (10), the Motor 
        Vehicle Titling, Registration and Salvage Advisory Committee, 
        which was convened by the Secretary of Transportation under 
        section 140(a) of the Anti Car Theft Act of 1992 (15 U.S.C. 
        2041 note), recommended that--
                    (A) Federal laws be enacted to require certain 
                definitions to be used nationwide to describe seriously 
                damaged vehicles; and
                    (B) all States be required to--
                            (i) use the definitions referred to in 
                        subparagraph (A) in determining appropriate 
                        title designations;
                            (ii) use certain motor vehicle titling and 
                        control methods; and
                            (iii) take certain other measures to 
                        protect the integrity of the titling process.

SEC. 3. MOTOR VEHICLE TITLING AND DISCLOSURE REQUIREMENTS.

    (a) In General.--Subtitle VI of title 49, United States Code, is 
amended by adding at the end the following new chapter:

   ``CHAPTER 333--AUTOMOBILE SAFETY, ANTITHEFT, AND TITLE DISCLOSURE 
                              REQUIREMENTS

``Sec.
``33301. Definitions.
``33302. Passenger motor vehicle titling.
``33303. Petitions for extensions of time.
``33304. Effect on State law.
``33305. Civil and criminal penalties.
``Sec. 33301. Definitions
    ``For the purposes of this chapter the following definitions and 
requirements shall apply:
            ``(1) Passenger motor vehicle.--
                    ``(A) In general.--The term `passenger motor 
                vehicle' means any vehicle driven or drawn by 
                mechanical power manufactured primarily for use on the 
                public streets, roads, and highways.
                    ``(B) Passenger motor vehicles and light trucks 
                included.--Such term includes a multipurpose passenger 
                vehicle or light duty truck if the vehicle or truck is 
                rated at not more than 7,500 pounds gross vehicle 
                weight.
                    ``(C) Motorcycles not included.--Such term does not 
                include a motorcycle.
            ``(2) Salvage vehicle.--
                    ``(A) In general.--Subject to subparagraph (E), the 
                term `salvage vehicle' means any passenger motor 
                vehicle that has been wrecked, destroyed, or damaged to 
                the extent that the total estimated or actual cost of 
                parts and labor to rebuild or reconstruct the passenger 
                motor vehicle to its preaccident condition for legal 
                operation on the roads or highways exceeds 75 percent 
                of the retail value of the passenger motor vehicle, as 
                set forth in the most recent edition of any nationally 
                recognized compilation (including automated databases) 
                of current retail values that is approved by the 
                Secretary.
                    ``(B) Vehicles excluded.--Such term does not 
                include any passenger motor vehicle that has a model 
                year designation of a calendar year that precedes that 
                calendar year in which the vehicle was wrecked, 
destroyed, or damaged by 5 or more years.
                    ``(C) Determination of value of repair parts.--For 
                purposes of subparagraph (B), the value of repair parts 
                shall be determined by using--
                            ``(i) the published retail cost of the 
                        original equipment manufacturer parts; or
                            ``(ii) the actual retail cost of the repair 
                        parts to be used in the repair.
                    ``(D) Determination of labor costs.--For purposes 
                of subparagraph (B), the labor cost of repairs shall be 
                computed by using the hourly labor rate and time 
                allocations that are reasonable and customary in the 
                automobile repair industry in the community in which 
                the repairs are performed.
                    ``(E) Certain vehicles included.--The term 
                `passenger vehicle' includes, without regard to whether 
                the passenger motor vehicle meets the 75 percent 
                threshold specified in subparagraph (B)--
                            ``(i) any passenger motor vehicle with 
                        respect to which an insurance company acquires 
                        ownership under a damage settlement (except for 
                        a settlement in connection with a recovered 
                        theft vehicle that did not sustain a sufficient 
                        degree of damage to meet the 75 percent 
                        threshold specified in subparagraph (B)); or
                            ``(ii) any passenger motor vehicle that an 
                        owner may wish to designate as a salvage 
                        vehicle by obtaining a salvage title, without 
                        regard to the extent of the damage and repairs.
                    ``(F) Special rule.--A designation of a passenger 
                motor vehicle by an owner under subparagraph (E)(ii) 
                shall not impose any obligation on--
                            ``(i) the insurer of the passenger motor 
                        vehicle; or
                            ``(ii) an insurer processing a claim made 
                        by or on behalf of the owner of the passenger 
                        motor vehicle.
            ``(3) Salvage title.--
                    ``(A) In general.--The term `salvage title' means a 
                passenger motor vehicle ownership document issued by a 
                State to the owner of a salvage vehicle.
                    ``(B) Transfer of ownership.--Ownership of a 
                salvage vehicle may be transferred on a salvage title.
                    ``(C) Prohibition.--The salvage vehicle may not be 
                registered for use on the roads or highways unless the 
                salvage vehicle has been issued a rebuilt salvage 
                title.
                    ``(D) Requirement for a rebuilt salvage title.--A 
                salvage title shall be conspicuously labeled with the 
                word `salvage' across the front of the document.
            ``(4) Rebuilt salvage vehicle.--The term `rebuilt salvage 
        vehicle' means--
                    ``(A) for passenger motor vehicles subject to a 
                safety inspection in a State that requires such an 
                inspection under section 33302(b)(2)(H), any passenger 
                motor vehicle that has--
                            ``(i) been issued previously a salvage 
                        title;
                            ``(ii) passed applicable State antitheft 
                        inspection;
                            ``(iii) been issued a certificate 
                        indicating that the passenger motor vehicle 
                        has--
                                    ``(I) passed the antitheft 
                                inspection referred to in clause (ii); 
                                and
                                    ``(II) been issued a certificate 
                                indicating that the passenger motor 
                                vehicle has passed a required safety 
                                inspection under section 
                                33302(b)(2)(H); and
                            ``(iv) affixed to the door jamb adjacent to 
                        the driver's seat a decal stating `Rebuilt 
                        Salvage Vehicle--Antitheft and Safety 
                        Inspections Passed'; or
                    ``(B) for passenger motor vehicles in a State other 
                than a State referred to in subparagraph (A), any 
                passenger motor vehicle that has--
                            ``(i) been issued previously a salvage 
                        title;
                            ``(ii) passed an applicable State antitheft 
                        inspection;
                            ``(iii) been issued a certificate 
                        indicating that the passenger motor vehicle has 
                        passed the required antitheft inspection 
                        referred to in clause (ii); and
                            ``(iv) affixed to the door jamb adjacent to 
                        the driver's seat, a decal stating `Rebuilt 
                        Salvage Vehicle--Antitheft Inspection Passed/No 
                        Safety Inspection Pursuant to National 
                        Criteria'.
            ``(5) Rebuilt salvage title.--
                    ``(A) In general.--The term `rebuilt salvage title' 
                means the passenger motor vehicle ownership document 
                issued by a State to the owner of a rebuilt salvage 
                vehicle.
                    ``(B) Transfer of ownership.--Ownership of a 
                rebuilt salvage vehicle may be transferred on a rebuilt 
                salvage title.
                    ``(C) Registration for use.--A passenger motor 
                vehicle for which a rebuilt salvage title has been 
                issued may be registered for use on the roads and 
                highways.
                    ``(D) Requirement for salvage title.--A rebuilt 
                salvage title shall be conspicuously labeled, either 
                with `Rebuilt Salvage Vehicle--Antitheft and Safety 
                Inspections Passed' or `Rebuilt Salvage Vehicle--
                Antitheft Inspection Passed/No Safety Inspection 
                Pursuant to National Criteria', as appropriate, across 
                the front of the document.
            ``(6) Nonrepairable vehicle.--
                    ``(A) In general.--The term `nonrepairable vehicle' 
                means any passenger motor vehicle that--
                            ``(i)(I) is incapable of safe operation for 
                        use on roads or highways; and
                            ``(II) has no resale value, except as a 
                        source of parts or scrap only; or
                            ``(ii) the owner irreversibly designates as 
                        a source of parts or scrap.
                    ``(B) Certificate.--Each nonrepairable vehicle 
                shall be issued a nonrepairable vehicle certificate.
            ``(7) Nonrepairable vehicle certificate.--
                    ``(A) In general.--The term `nonrepairable vehicle 
                certificate' means a passenger motor vehicle ownership 
                document issued by the State to the owner of a 
                nonrepairable vehicle.
                    ``(B) Transfer of ownership.--Ownership of the 
                passenger motor vehicle may be transferred not more 
                than 2 times on a nonrepairable vehicle certificate.
                    ``(C) Prohibition.--A nonrepairable vehicle that is 
                issued a nonrepairable vehicle certificate may not be 
                titled or registered for use on roads or highways at 
                any time after the issuance of the certificate.
                    ``(D) Requirement for nonrepairable vehicle 
                certificate.--A nonrepairable vehicle certificate shall 
                be conspicuously labeled with the term `Nonrepairable' 
                across the front of the document.
            ``(8) Flood vehicle.--
                    ``(A) In general.--The term `flood vehicle' means 
                any passenger motor vehicle that has been submerged in 
                water to the point that rising water has reached over 
                the door sill of the motor vehicle and has entered the 
                passenger or trunk compartment.
                    ``(B) Requirement for disclosure.--Disclosure that 
                a passenger motor vehicle has become a flood vehicle 
                shall be made by the person transferring ownership at 
                the time of transfer of ownership. After such transfer 
                is completed, the certificate of title shall be 
                conspicuously labeled with the term `flood' across the 
                front of the document.
            ``(9) Secretary.--The term `Secretary' means the Secretary 
        of Transportation.
``Sec. 33302. Passenger motor vehicle titling
    ``(a) Carryforward of Certain Title Information if a Previous Title 
Was Not Issued in Accordance With Certain Nationally Uniform 
Standards.--
            ``(1) In general.--If--
                    ``(A) records that are readily accessible to a 
                State indicate that a passenger motor vehicle with 
                respect to which the ownership is transferred on or 
                after the date that is 1 year after the date of 
                enactment of the National Motor Vehicle Safety, 
                Antitheft, Title Reform, and Consumer Protection Act of 
                1996, has been issued previously a title that bore a 
                term or symbol described in paragraph (2); and
                    ``(B) the State licenses that vehicle for use,
        the State shall disclose that fact on a certificate of title 
        issued by the State.
            ``(2) Terms and symbols.--
                    ``(A) In general.--A State shall be subject to the 
                requirements of paragraph (1) with respect to the 
                following terms on a title that has been issued 
                previously to a passenger motor vehicle (or symbols 
                indicating the meanings of those terms):
                            ``(i) `Salvage'.
                            ``(ii) `Unrebuildable'.
                            ``(iii) `Parts only'.
                            ``(iv) `Scrap'.
                            ``(v) `Junk'.
                            ``(vi) `Nonrepairable'.
                            ``(vii) `Reconstructed'.
                            ``(viii) `Rebuilt'.
                            ``(ix) Any other similar term, as 
                        determined by the Secretary.
                    ``(B) Flood damage.--A State shall be subject to 
                the requirements of paragraph (1) if a term or symbol 
                on a title issued previously for a passenger vehicle 
                indicates that the vehicle has been damaged by flood.
    ``(b) Nationally Uniform Title Standards and Control Methods.--
            ``(1) In general.--Not later than 18 months after the date 
        of the enactment of the National Motor Vehicle Safety, 
        Antitheft, Title Reform, and Consumer Protection Act of 1996, 
        the Secretary shall issue regulations that require each State 
        that licenses passenger motor vehicles with respect to which 
        the ownership is transferred on or after the date that is 2 
        years after the issuance of final regulations, to apply with 
        respect to the issuance of the title for any such motor vehicle 
        uniform standards, procedures, and methods for--
                    ``(A) the issuance and control of that title; and
                    ``(B) information to be contained on such title.
            ``(2) Contents of regulations.--The titling standards, 
        control procedures, methods, and information covered under the 
        regulations issued under this subsection shall include the 
        following:
                    ``(A) Indication of status.--Each State shall 
                indicate on the face of a 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.
                    ``(B) Subsequent titles.--The information referred 
                to in subparagraph (A) concerning the status of the 
                passenger vehicle 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.
                    ``(C) Security standards.--The title documents, the 
                certificates and decals required by section 33301(4), 
and the system for issuing those documents, certificates, and decals 
shall meet security standards that minimize opportunities for fraud.
                    ``(D) Identifying information.--Each certificate of 
                title referred to in subparagraph (A) shall include the 
                passenger motor vehicle make, model, body type, year, 
                odometer disclosure, and vehicle identification number.
                    ``(E) Uniform layout.--The title documents covered 
                under the regulations shall maintain a uniform layout, 
                that shall be established by the Secretary, in 
                consultation with each State or an organization that 
                represents States.
                    ``(F) Nonrepairable vehicles.--A passenger motor 
                vehicle designated as nonrepairable--
                            ``(i) shall be issued a nonrepairable 
                        vehicle certificate; and
                            ``(ii) may not be retitled.
                    ``(G) Rebuilt salvage title.--No rebuilt salvage 
                title may be issued to a salvage vehicle unless, after 
                the salvage vehicle is repaired or rebuilt, the salvage 
                vehicle complies with the requirements for a rebuilt 
                salvage vehicle under section 33301(4).
                    ``(H) Inspection programs.--Each State inspection 
                program shall be designed to comply with the 
                requirements of this subparagraph and shall be subject 
                to approval and periodic review by the Secretary. Each 
                such inspection program shall include the following:
                            ``(i) Each owner of a passenger motor 
                        vehicle that submits a vehicle for an antitheft 
                        inspection shall be required to provide--
                                    ``(I) a completed document 
                                identifying the damage that occurred to 
                                the vehicle before being repaired;
                                    ``(II) a list of replacement parts 
                                used to repair the vehicle;
                                    ``(III) proof of ownership of the 
                                replacement parts referred to in 
                                subclause (II) (as evidenced by bills 
                                of sale, invoices or, if such documents 
                                are not available, other proof of 
                                ownership for the replacement parts); 
                                and
                                    ``(IV) an affirmation by the owner 
                                that--
                                            ``(aa) the information 
                                        required to be submitted under 
                                        this subparagraph is complete 
                                        and accurate; and
                                            ``(bb) to the knowledge of 
                                        the declarant, no stolen parts 
                                        were used during the rebuilding 
                                        of the repaired vehicle.
                            ``(ii) Any passenger motor vehicle or any 
                        major part or major replacement part required 
                        to be marked under this section or the 
                        regulations issued under this section that--
                                    ``(I) has a mark or vehicle 
                                identification number that has been 
                                illegally altered, defaced, or 
                                falsified; or
                                    ``(II) cannot be identified as 
                                having been legally obtained (through 
                                evidence described in clause (i)(III)),
                        shall be contraband and subject to seizure.
                            ``(iii) To avoid confiscation of parts that 
                        have been legally rebuilt or manufactured, the 
                        regulations issued under this subsection shall 
                        include procedures that the Secretary, in 
                        consultation with the Attorney General of the 
                        United States, shall establish--
                                    ``(I) for dealing with parts with a 
                                mark or vehicle identification number 
                                that is normally removed during 
                                remanufacturing or rebuilding practices 
                                that are considered acceptable by the 
                                automotive industry; and
                                    ``(II) deeming any part referred to 
                                in clause (i) to meet the 
                                identification requirements under the 
                                regulations if the part bears a 
                                conspicuous mark of such type, and is 
                                applied in such manner, as may be 
                                determined by the Secretary to indicate 
                                that the part has been rebuilt or 
                                remanufactured.
                            ``(iv) With respect to any vehicle part, 
                        the regulations issued under this subsection 
                        shall--
                                    ``(I) acknowledge that a mark or 
                                vehicle identification number on such 
                                part may be legally removed or altered, 
                                as provided under section 511 of title 
                                18, United States Code; and
                                    ``(II) 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.
                            ``(v) The Secretary shall establish 
                        nationally uniform safety inspection criteria 
                        to be used in States that require such a safety 
                        inspection. A State may determine whether to 
                        conduct such safety inspection, contract with a 
                        third party, or permit self-inspection. Any 
                        inspection conducted under this clause shall be 
                        subject to criteria established by the 
                        Secretary. A State that requires a safety 
                        inspection under this clause may require the 
                        payment of a fee for such inspection or the 
                        processing of such inspection.
                    ``(I) Duplicate titles.--No duplicate or 
                replacement title may be issued by a State unless--
                            ``(i) the term `duplicate' is clearly 
                        marked on the face of the duplicate or 
                        replacement title; and
                            ``(ii) the procedures issued are 
                        substantially consistent with the 
                        recommendation designated as recommendation 3 
                        in the report issued on February 10, 1994, 
                        under section 140 of the Anti Car Theft Act of 
                        1992 (15 U.S.C. 2041 note) by the task force 
                        established under such section.
                    ``(J) Titling and control methods.--Each State 
                shall employ the following titling and control methods:
                            ``(i) 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 be required 
                        to apply for a salvage title or nonrepairable 
                        vehicle certificate, whichever is applicable, 
                        before the earlier of the date--
                                    ``(I) on which the passenger motor 
                                vehicle is repaired or the ownership of 
                                the passenger motor vehicle is 
                                transferred; or
                                    ``(II) that is 30 days after the 
                                passenger motor vehicle is damaged.
                            ``(ii) If an insurance company, under 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 shall be required to apply 
                        for a salvage title or nonrepairable vehicle 
                        certificate not later than 15 days after the 
                        title to the motor vehicle is--
                                    ``(I) properly assigned by the 
                                owner to the insurance company; and
                                    ``(II) delivered to the insurance 
                                company with all liens released.
                            ``(iii) If an insurance company does not 
                        assume ownership of a passenger motor vehicle 
                        of an insured person or claimant that has 
                        incurred damage requiring the vehicle to be 
                        titled as a salvage vehicle or nonrepairable 
                        vehicle, the insurance company shall, as 
                        required by the applicable State--
                                    ``(I) notify--
                                            ``(aa) the owner of the 
                                        owner's obligation to apply for 
                                        a salvage title or 
                                        nonrepairable vehicle 
                                        certificate for the passenger 
                                        motor vehicle; and
                                            ``(bb) the State passenger 
                                        motor vehicle titling office 
                                        that a salvage title or 
                                        nonrepairable vehicle 
                                        certificate should be issued 
                                        for the vehicle; or
                                    ``(II) withhold payment of the 
                                claim until the owner applies for a 
                                salvage title or nonrepairable vehicle 
                                certificate.
                            ``(iv) If a leased passenger motor vehicle 
                        incurs damage requiring the vehicle to be 
                        titled as a salvage vehicle or nonrepairable 
                        vehicle, the lessor shall be required to apply 
                        for a salvage title or nonrepairable vehicle 
                        certificate not later than 21 days after being 
                        notified by the lessee that the vehicle has 
                        been so damaged, except in any case in which an 
                        insurance company, under a damage settlement, 
                        acquires ownership of the vehicle. The lessee 
                        of such vehicle shall be required to inform the 
                        lessor that the leased vehicle has been so 
                        damaged not later than 30 days after the 
                        occurrence of the damage.
                            ``(v)(I) Any person who acquires 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 be required to apply for a 
                        salvage title or nonrepairable vehicle 
                        certificate, whichever is applicable.
                            ``(II) An application under subclause (I) 
                        shall be made the earlier of--
                                    ``(aa) the date on which the 
                                vehicle is further transferred; or
                                    ``(bb) 30 days after ownership is 
                                acquired.
                            ``(III) The requirements of this clause 
                        shall not apply to any scrap metal processor 
                        that--
                                    ``(aa) acquires a passenger motor 
                                vehicle for the sole purpose of 
                                processing the motor vehicle into 
                                prepared grades of scrap; and
                                    ``(bb) carries out that processing.
                            ``(vi) State records shall note when a 
                        nonrepairable vehicle certificate is issued. No 
                        State shall issue a nonrepairable vehicle 
                        certificate after 2 transfers of ownership in 
                        violation of section 33301(b)(7)(B).
                            ``(vii)(I) In any case in which a passenger 
                        motor vehicle has been flattened, baled, or 
                        shredded, whichever occurs first, the title or 
                        nonrepairable vehicle certificate for the 
                        vehicle shall be surrendered to the State not 
                        later than 30 days after that occurrence.
                            ``(II) If the second transferee on a 
                        nonrepairable vehicle certificate is unequipped 
                        to flatten, bale, or shred the vehicle, such 
                        transferee shall be required, at the time of 
                        final disposal of the vehicle, to use the 
                        services of a professional automotive recycler 
                        or professional scrap processor. That recycler 
                        or reprocessor shall have the authority to--
                                    ``(aa) flatten, bale, or shred the 
                                vehicle; and
                                    ``(bb) effect the surrender of the 
                                nonrepairable vehicle certificate to 
                                the State on behalf of the second 
                                transferee.
                            ``(III) State records shall be updated to 
                        indicate the destruction of a vehicle under 
                        this clause and no further ownership 
                        transactions for the vehicle shall be permitted 
                        after the vehicle is so destroyed.
                            ``(IV) If different from 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.
                            ``(viii)(I) In any case in which a salvage 
                        title is issued, the State records shall note 
                        that issuance. No State may 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 that--
                                    ``(aa) complies with the security 
                                and guideline standards established by 
                                the Secretary under subparagraphs (C) 
                                and (G), as applicable; and
                                    ``(bb) indicates that the vehicle 
                                has passed the inspections required by 
                                the State under subparagraph (H).
                            ``(II) Nothing in this clause shall 
                        preclude the issuance of a new salvage title 
                        for a salvage vehicle after a transfer of 
                        ownership.
                            ``(ix) After a passenger motor vehicle 
                        titled with a salvage title has passed the 
                        inspections required by the State, the 
                        inspection official shall--
                                    ``(I) affix a secure decal required 
                                under section 33301(4) (that meets 
                                permanency requirements that the 
                                Secretary shall establish by 
                                regulation) to the door jamb on the 
                                driver's side of the vehicle; and
                                    ``(II) issue to the owner of the 
                                vehicle a certificate indicating that 
                                the passenger motor vehicle has passed 
                                the inspections required by the State.
                            ``(x)(I) The owner of a passenger motor 
                        vehicle titled with a salvage title may obtain 
                        a rebuilt salvage title and vehicle 
                        registration 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.
                            ``(II) If the owner of a rebuilt salvage 
                        vehicle submits the documentation referred to 
                        in subclause (I), the State shall issue upon 
                        the request of the owner a rebuilt salvage 
                        title and registration to the owner. When a 
                        rebuilt salvage title is issued, the State 
                        records shall so note.
                    ``(K) Flood vehicles.--
                            ``(i) In general.--A seller of a passenger 
                        motor vehicle that becomes a flood vehicle 
                        shall, at or before the time of transfer of 
                        ownership, provide a written notice to the 
                        purchaser that the vehicle is a flood vehicle. 
                        At the time of the next title application for 
                        the vehicle--
                                    ``(I) the applicant shall disclose 
                                the flood status to the applicable 
                                State with the properly assigned title; 
                                and
                                    ``(II) the term `Flood' shall be 
                                conspicuously labeled across the front 
                                of the new title document.
                            ``(ii) Leased vehicles.--In the case of a 
                        leased passenger motor vehicle, the lessee, 
                        within 15 days after 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.
    ``(c) Electronic Procedures.--A State may employ electronic 
procedures in lieu of paper documents in any case in which such 
electronic procedures provide levels of information, function, and 
security required by this section that are at least equivalent to the 
levels otherwise provided by paper documents.
``Sec. 33303. Petitions for extensions of time
    ``(a) In General.--Subject to subsection (b), if a State 
demonstrates to the satisfaction of the Secretary, a valid reason for 
needing an extension of a deadline for compliance with requirements 
under section 33302(a), the Secretary may extend, for a period 
determined by the Secretary, an otherwise applicable deadline with 
respect to that State.
    ``(b) Limitation.--No extension made under subsection (a) shall 
remain in effect on or after the applicable compliance date established 
under section 33302(b).
``Sec. 33304. Effect on State law
    ``(a) In General.--Beginning on the effective date of the 
regulations issued under section 33302, this chapter shall preempt any 
State law, to the extent that State law is inconsistent with this 
chapter or the regulations issued under this chapter (including the 
regulations issued under section 33302), that--
            ``(1) establish the form of the passenger motor vehicle 
        title;
            ``(2)(A) 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)--
                    ``(i) any term defined in section 33301;
                    ``(ii) the term `salvage', `junk', `reconstructed', 
                `nonrepairable', `unrebuildable', `scrap', `parts 
                only', `rebuilt', `flood', or any other similar symbol 
                or term; or
            ``(B) apply any of the terms referred to in subparagraph 
        (A) to any passenger motor vehicle (but not in connection with 
        a passenger motor vehicle part or part assembly separate from a 
        passenger motor vehicle); and
            ``(3) establish titling, recordkeeping, antitheft 
        inspection, or control procedures in connection with any 
        salvage vehicle, rebuilt salvage vehicle, nonrepairable 
        vehicle, or flood vehicle.
    ``(b) Rule of Construction.--
            ``(1) Additional disclosures.--Additional disclosures of 
        the title status or history of a motor vehicle, in addition to 
        disclosures made concerning the applicability of terms defined 
        in section 33301, may not be considered to be inconsistent with 
        this chapter.
            ``(2) Inconsistent terms.--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 under Federal or State law of a 
        term defined in section 33301 that is different from the 
        definition provided for in that section or any use of any other 
        term listed in subsection (a), shall be considered to be 
        inconsistent with this chapter.
            ``(3) Rule of construction.--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 that differed from the nationally uniform criteria 
        promulgated under section 33302(b)(2)(H)(v).
``Sec. 33305. Civil and criminal penalties
    ``(a) Prohibited Acts.--It shall be unlawful for any person 
knowingly and willfully 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;
            ``(2) fail to apply for a salvage title in any case in 
        which such an application is required;
            ``(3) alter, forge, or counterfeit--
                    ``(A) a certificate of title (or an assignment 
                thereof);
                    ``(B) a nonrepairable vehicle certificate;
                    ``(C) a certificate verifying an antitheft 
                inspection or an antitheft and safety inspection; or
                    ``(D) a decal affixed to a passenger motor vehicle 
                under section 33302(b)(2)(J)(ix);
            ``(4) falsify the results of, or provide false information 
        in the course of, an inspection conducted under section 
        33302(b)(2)(H);
            ``(5) offer to sell any salvage vehicle or nonrepairable 
        vehicle as a rebuilt salvage vehicle; or
            ``(6) conspire to commit any act under paragraph (1), (2), 
        (3), (4), or (5).
    ``(b) Civil Penalty.--Any person who commits an unlawful act under 
subsection (a) shall be subject to a civil penalty in an amount not to 
exceed $2,000.
    ``(c) Criminal Penalty.--Any person who knowingly commits an 
unlawful act under subsection (a) shall, upon conviction, be--
            ``(1) subject to a fine in an amount not to exceed $50,000;
            ``(2) imprisoned for a term not to exceed 3 years; or
            ``(3) subject to both fine under paragraph (1) and 
        imprisonment under paragraph (2).''.
    (b) Conforming Amendment.--The analysis for subtitle VI of title 
49, United States Code, is amended by adding at the end the following 
new item:

``333. Automobile Safety, Antitheft, and Title Disclosure      33301''.
                            Requirements.
                                 <all>
```