MINUTES OF THE SENATE COMMITTEE ON TRANSPORTATION Sixty-eighth Session June 13, 1995 The Senate Committee on Transportation was called to order by Chairman William R. O'Donnell, at 2:15 p.m., on Tuesday, June 13, 1995, in Room 226 of the Legislative Building, Carson City, Nevada. Exhibit A is the Agenda. Exhibit B is the Attendance Roster. COMMITTEE MEMBERS PRESENT: Senator William R. O'Donnell, Chairman Senator Maurice Washington, Vice Chairman Senator Lawrence E. Jacobsen Senator Jon C. Porter Senator Joseph M. Neal, Jr. Senator Raymond C. Shaffer Senator O. C. Lee STAFF MEMBERS PRESENT: Don O. Williams, Chief Principal Research Analyst Diane Rea, Committee Secretary OTHERS PRESENT: Jack Jeffrey, Representative, D & E Auto Auctions Robert Ellis, Owner, D & E Auto Auctions Keith Lynam, Lobbyist, Nevada Franchised Auto Dealers Association (NFADA) Dick Mills, Owner, Pick-N-Pull Auto Dismantlers Stan Warren, Lobbyist, Sierra Pacific Resources Larry Stout, Assistant Chief, Registration Division, Department of Motor Vehicles and Public Safety (DMV&PS) Jim Werbeckes, Lobbyist, Farmers Insurance Group Greg Harwell, Lobbyist, California State Automobile Association (CSAA) Galen Denio, Commissioner, Public Service Commission of Nevada (PSC) Daryl Capurro, Lobbyist, Nevada Franchised Auto Dealers Association (NFADA), Nevada Motor Transport Association, Inc. (NMTA) Senator O'Donnell opened the hearing of Assembly Bill (A.B.) 486. ASSEMBLY BILL 486: Revises provisions governing sale of salvage vehicles. (BDR 43-1088) Jack Jeffrey, Representative, D & E Auto Auctions, testified this bill attempts to clean up some of the problems of the chop shops buying automobiles without a clean title. He reviewed the bill. The purpose of the bill is to prevent vehicles owned by individuals, leasing companies, financial institutions, and insurance companies from being sold on a clear title if they are a total-loss-vehicle. Robert Ellis, Owner, D & E Auto Auctions, explained the insurance companies are governed by law. The difference between today and the way it will be if the bill is passed is the rental car agencies, self insured, financing institutes and leasing companies sell their total-loss-vehicles to anybody. With the new bill, the certificate of ownership will be forwarded to the Department of Motor Vehicles and Public Safety (DMV&PS) and the title will be branded for a total-loss-vehicle. If the vehicle is put up for sale, the buyer will know they are buying a vehicle that has been wrecked. Senator Neal said he feels this is a good bill. Senator Jacobsen asked how, where, and when is a vehicle declared a total loss? Mr. Jeffrey responded that the language in section 2 covers that. If the owner, leasing company, financing institution or the insurance company considers it uneconomical to repair, it is a total-loss vehicle. Senator Jacobsen asked at what point is it considered a total- loss vehicle? Mr. Jeffrey said section 5 says within 125 days of the vehicle being damaged. Senator Jacobsen asked if a vehicle is damaged or wrecked before it is titled, how will that be handled? Mr. Jeffrey responded those will be handled with a MSO (manufacturer statement of origin) and could be sold to a dealer. Keith Lynam, Lobbyist, Nevada Franchised Auto Dealers Association (NFADA), presented a proposed amendment to the bill (Exhibit C). He said in section 5 they want to insure that allows a person to sell a total-loss-vehicle to an auto wrecker. The certificate of title will be forwarded to the state and the dismantling process is allowed. Senator O'Donnell asked if someone has a clear title to their vehicle and they wreck it, the insurance company will give them $5,000 and the owner takes their vehicle? The wrecker can go to that person directly; without having to go through the salvage pool. How often does that happen? Dick Mills, Owner, Pick-N-Pull Auto Dismantlers, responded that happens quite often. A third party settlement will deduct the salvage value from the car value and leave the vehicle with the owner; as well as the title. Senator O'Donnell asked how the bill can ask out-of-state dealers to be licensed in the state of Nevada in order to purchase these vehicles? Mr. Lynam stated they want everyone under the same umbrella. Nevada wreckers have to be bonded and licensed. Senator Washington asked if other states have the same provision? Do Nevada dealers have the same provision? Mr. Lynam replied: "No, you go in and show them your license." Senator Washington asked why Nevada would want to do that to other states? Mr. Lynam said the Nevada dealer is treated differently because they are required to have these provisions. It should be the same for all the dealers. He said he thinks the DMV&PS should know who is coming into Nevada to purchase vehicles. Senator O'Donnell said what the bill says is different from what Mr. Lynam is wanting. He suggested that Mr. Lynam wants to restrict out-of-state people from bidding on the vehicles. Mr. Mills responded they just want them to all have to go into DMV&PS and pay the fees, or eliminate the fees for the Nevada wreckers. Senator O'Donnell said what they want to say is: The department may issue a license to an automobile wrecker to an applicant licensed in another state, if the requirements for the licensing and for the issuance of ownership in that state, are at least as stringent as the requirements in this state. Mr. Mills stated that he does not think the out-of-state dealers need to do any more than register with DMV&PS, not with the salvage pools. Mr. Lynam said that the Nevada wreckers have to pay a $50 fee, but the out-of-state people do not have to pay that fee and this is not fair. Senator Washington said if the out-of-state people only have to show their license and do not have to be bonded in Nevada, that is okay. Stan Warren, Lobbyist, Sierra Pacific Resources, testified tankers and line rigs take a little longer to evaluate for damages. He said the 125-day requirement is adequate. Larry Stout, Assistant Chief, Registration Division, Department of Motor Vehicles and Public Safety (DMV&PS), said the department is in support of section 1 through section 6 in the bill. Section 7 is a competitive issue and it is valuable information to the department to know who is buying these vehicles? Senator Porter asked if there are a lot of people coming in from outside of Nevada to buy salvaged vehicles. Mr. Mills responded there are about 120 out-of-state buyers. There are about 44 local auto wreckers in Las Vegas and about 14 others in-state. The major buyers are from California, Mexico, Salt Lake City and even Nebraska Jim Werbeckes, Lobbyist, Farmers Insurance Group, stated that the insurance industry supports the bill. They believe this bill will increase the number of buyers at the pool. Greg Harwell, Lobbyist, California State Automobile Association (CSAA), stated that they also support A.B. 486. Senator Jacobsen asked how the value of a vehicle is determined? Mr. Werbeckes replied that the insurance company will write an estimate for the repairs on a vehicle. All pertinent information concerning a vehicle is given to a company called CCC which is a valuing company. They are given all the information concerning the vehicle and they give the selling value for that vehicle in the local market. He said if the insurance companies value of the vehicle is less than what CCC values the vehicle, plus the salvage value, the vehicle is declared a total-loss-vehicle. The return on the money will be better to total the vehicle and sell it to salvage, rather than try to repair the vehicle. Senator Jacobsen asked about the vehicles that are donated to the fire department from the utility companies, how is the write-off value determined? Galen Denio, Commissioner, Public Service Commission of Nevada (PSC), testified it is not a moneymaking thing for the companies. Daryl Capurro, Lobbyist, Nevada Franchised Auto Dealers Association (NFADA), Nevada Motor Transport Association, Inc. (NMTA), testified they do not use the depreciated book value. They will use a national guide minus reconditioning costs involved. Senator O'Donnell closed the hearing on A.B. 486. Senator O'Donnell recessed the committee for 10 minutes. Senator O'Donnell called the hearing back to order. He opened the hearing on Assembly Concurrent Resolution (A.C.R.) 31. ASSEMBLY CONCURRENT Expresses support for programs to mitigate traffic RESOLUTION 31: noise. (BDR R-1959) A memorandum from the Nevada Department of Transportation (Exhibit D) and Amendment No. 892 to A.C.R. 31 were distributed to the committee (Exhibit E). SENATOR SHAFFER MOVED TO AMEND AND DO PASS A.C.R. 31 WITH AMENDMENT NO. 892. SENATOR JACOBSEN SECONDED THE MOTION. THE MOTION CARRIED. (SENATORS WASHINGTON, PORTER AND NEAL WERE ABSENT FOR THE VOTE.) * * * * * Senator O'Donnell called for an indefinite postponement on Senate Bill (S.B.) 107 because it has been incorporated into S.B. 442 which was passed out of the committee on June 10, 1995. SENATE BILL 107: Removes certain exemptions from provisions regulating motor carriers. (BDR 58-574) SENATE BILL 442: Conforms state regulation of motor carriers to new federal law. (BDR 58-1946) SENATOR SHAFFER MOVED TO INDEFINITELY POSTPONE S.B. 107. SENATOR LEE SECONDED THE MOTION. THE MOTION CARRIED. (SENATORS WASHINGTON AND NEAL WERE ABSENT FOR THE VOTE.) * * * * * The DMV&PS provided for the committee two proposed amendments to S.B. 397 (Exhibits F and G). SENATE BILL 397: Prohibits department of motor vehicles and public safety from requiring submission of certain information for renewal of special license plates for person with permanent disability which limits or impairs his ability to walk. (BDR 43-1040) Senator O'Donnell called for a motion to amend and do pass S.B. 397 with the proposed amendments. SENATOR LEE MOVED TO AMEND AND DO PASS S.B. 397 WITH THE PROPOSED AMENDMENTS. SENATOR JACOBSEN SECONDED THE MOTION. THE MOTION CARRIED. (SENATOR NEAL WAS ABSENT FOR THE VOTE.) * * * * * Senator O'Donnell opened the hearing on S.B. 442. SENATE BILL 442: Conforms state regulation of motor carriers to new federal law. (BDR 58-1946) Mr. Denio presented a proposed amendment (Exhibit H). He said Mr. Capurro and DMV&PS have concurred with these changes. Senator O'Donnell presented Amendment No. 708 (Exhibit I) to the committee for consideration and asked for a motion to amend and do pass. Senator O'Donnell asked if the proposed amendment conflicts with Amendment No. 708. Don O. Williams, Chief Principal Research Analyst, stated he has discussed the amendment proposal and Amendment No. 708 and was told that they could be incorporated within the amendment. Mr. Capurro added they concur with the proposed amendment and understands that the committee will be deleting sections 38 through 43 from Amendment NO. 708. Senator O'Donnell asked for a motion to rescind the committee's action to amend and do pass S.B. 442 with Amendment No. 708. SENATOR JACOBSEN MOVED TO RESCIND THE ACTION TO AMEND WITH AMENDMENT NO. 708 AND DO PASS S.B. 442. SENATOR WASHINGTON SECONDED THE MOTION. THE MOTION CARRIED. (SENATOR NEAL WAS ABSENT FOR THE VOTE.) * * * * * Senator O'Donnell called for a motion to amend and do pass S.B. 442 with the amendments proposed in Exhibit H being incorporated into Amendment No. 708. SENATOR JACOBSEN MOVED TO AMEND AND DO PASS S.B. 442 WITH THE NEW PROPOSED AMENDMENT INCORPORATED INTO AMENDMENT NO. 708. SENATOR WASHINGTON SECONDED THE MOTION. THE MOTION CARRIED. (SENATOR NEAL WAS ABSENT FOR THE VOTE.) * * * * * Senator O'Donnell adjourned the meeting at 3:50 p.m. RESPECTFULLY SUBMITTED: Diane C. Rea, Committee Secretary APPROVED BY: Senator William R. O'Donnell, Chairman DATE: Senate Committee on Transportation June 13, 1995 Page