Petition for Approval of Alternate Odometer Disclosure Requirements

John Womack
National Highway Traffic Safety Administration
Federal Register
August 29, 1994

[Federal Register: August 29, 1994]


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DEPARTMENT OF TRANSPORTATION
National Highway Traffic Safety Administration

49 CFR Part 580

[Docket No. 92-20; Notice 4]

 
Petition for Approval of Alternate Odometer Disclosure 
Requirements

AGENCY: National Highway Traffic Safety Administration (NHTSA), 
Department of Transportation.

ACTION: Notice of preliminary determination.

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SUMMARY: NHTSA's regulation concerning odometer disclosure sets forth 
procedures by which a State may petition for approval of alternate 
disclosure requirements to those otherwise required by the regulation. 
In accordance with these procedures, the State of Florida has submitted 
a petition for approval of alternate disclosure requirements allowing 
the State not to require the disclosure of the addresses of motor 
vehicle dealer transferors and transferees. NHTSA believes that an 
odometer disclosure statement that does not include these addresses 
threatens the integrity of the current system, and that Florida's 
proposed alternative does not properly accommodate the purposes which 
these addresses serve. Accordingly, NHTSA preliminarily denies 
Florida's petition for approval of the proposed alternate disclosure 
requirements.

DATES: Comments concerning this preliminary denial are due no later 
than September 28, 1994.

ADDRESSES: Written comments should refer to the docket number of this 
notice and should be submitted to: Docket Section, Room 5109, National 
Highway Traffic Safety Administration, 400 Seventh Street, SW., 
Washington, D.C. 20590. (Docket hours are 9:30 a.m. to 4:00 p.m.)

FOR FURTHER INFORMATION CONTACT: John Donaldson, Office of the Chief 
Counsel, Room 5219, National Highway Traffic Safety Administration, 400 
Seventh Street, SW., Washington, D.C. 20590, (202) 366-1834.

SUPPLEMENTARY INFORMATION:

Background

    To address the problem of odometer fraud, 49 U.S.C. chapter 327 
(previously 15 U.S.C. 1981 et seq.) (the Act) provides that each person 
transferring ownership of a motor vehicle must disclose the mileage on 
the vehicle's title. The Act requires the States to conform their 
procedures to enable the titles they issue to be used for odometer 
disclosure. Section 32705(d) of the Act directs NHTSA to approve 
alternate methods of odometer disclosure submitted by a State, provided 
that those methods are consistent with the purposes of the disclosure 
required by the Act.
    NHTSA's implementing regulation, 49 CFR part 580, identifies 
specific elements to be included in the odometer disclosure statement 
(49 CFR 580.5 and 580.7). The elements of central importance to the 
instant petition are the name and current address of both the 
transferor and the transferee. The regulation also sets forth 
procedures a petitioning State must follow to seek approval of 
alternate requirements to those otherwise required of the State (49 CFR 
580.11). In accordance with this latter provision, the State of Florida 
has submitted a petition for approval of alternate disclosure 
requirements.

Basis for the Petition

    Florida seeks approval for alternative procedures to those 
contained in 49 U.S.C. 32705(b) (previously 15 U.S.C. 1988(d)) and 49 
CFR 580.5 (c)(3) and (c)(4). (The petition identifies paragraphs (c)(2) 
and (c)(3) of the regulation, but it is clear from its context that 
paragraphs (c)(3) and (c)(4) were intended.) These provisions require 
odometer disclosure statements to be made on a title produced by means 
of a secure printing process and to include the name and current 
address of the transferor and transferee.
    Florida currently uses two motor vehicle title forms, copies of 
which were submitted with the petition. In all aspects of relevance 
here, the forms are identical. Both forms contain one block for 
transfer of title by seller on the front and three blocks for dealer 
reassignment and one block for application for title on the back. 
Florida states that the transfer of title and the dealer reassignment 
blocks appear as prescribed by 49 CFR 580.5, except that they do not 
contain a space for the address of the transferor and transferee. 
Notwithstanding the absence of address spaces in these locations, 
Florida asserts that its titles comply with the Federal requirements in 
all cases except those involving reassignment by a licensed motor 
vehicle dealer.
    Florida explains that State law (Florida Statutes, Chapter 319) 
precludes the assignment of a motor vehicle title by anyone other than 
the person in whose name the title was issued, unless the person is a 
dealer. Consequently, in a sale between non-dealers, Florida points out 
that the required addresses will be available because the transferor's 
address appears on the front of the title and the transferee's address 
will eventually appear in the block for ``Application for Title by 
Purchaser.'' Citing NHTSA's determination (53 FR No. 151 at 29470, Aug. 
5, 1988) that information located elsewhere on the title need not be 
repeated in the disclosure statement, Florida argues that its titles 
comply with Federal requirements related to transfers between non-
dealers.
    The alternate procedures for which Florida seeks approval apply to 
transfers by or between licensed dealers. Florida acknowledges that its 
titles do not make accommodation for the address of a dealer. Instead, 
the dealer is required to include its license number in the 
reassignment block appearing on the back of the title, when effecting a 
subsequent transfer. According to Florida, the Department of Highway 
Safety and Motor Vehicles (DHS) maintains records of all licensed 
dealers in the State, indexed by both license number and name, from 
which current address information is freely available upon request. 
Florida asserts that this system is superior to the requirement of 
NHTSA's regulation, because the State records contain the latest 
available address information, and because consumers can be informed by 
the DHS of avenues of relief through the State's consumer complaint 
process and its $25,000 dealer license bond. Accordingly, Florida 
concludes that the odometer disclosure procedures it imposes on dealers 
are fully consistent with the purposes behind the Federal odometer 
disclosure requirements, and that its petition should therefore be 
granted.

Preliminary Determination

    With respect to motor vehicle transfers in which no party is a 
dealer, NHTSA agrees that the odometer disclosure procedures imposed by 
Florida comply with Federal odometer disclosure requirements. While it 
is preferable, from the standpoint of clarity, for the purchaser's 
address to appear in the transfer block on the front of the title, we 
nevertheless conclude that Florida's procedure adequately accommodates 
all statutory and regulatory requirements covering these non-dealer 
transactions.
    NHTSA does not agree, however, that the procedures Florida imposes 
on transactions in which at least one party is a dealer are consistent 
with the purposes of the Federal requirements. Even assuming that 
consumers are afforded unhindered access to in-state dealer address 
information maintained by the DHS pursuant to its licensing authority, 
this system fails to recognize the interstate nature of motor vehicle 
transfers. Should a dealer from another State be involved in the chain 
of transfer on a Florida title, the DHS would be unable to provide the 
required address information. Moreover, without any identifying 
information beyond a license number from an unknown State, it would be 
extremely difficult to determine the location of an out-of-state 
dealer.
    NHTSA believes that Florida's proposed procedures would hinder 
enforcement efforts, which rely on readily available address 
information for all transferors and transferees in order to trace the 
sales histories of motor vehicles. It is also worth noting that title 
blocks lacking a common information element accepted by most States as 
the norm for compliance with odometer disclosure requirements are more 
likely to be questioned or rejected in interstate transactions. NHTSA 
is aware of several such occurrences, and is mindful of their negative 
impacts on interstate title transfers. Accordingly, the agency 
concludes that Florida's approach is inconsistent with the purposes of 
the odometer disclosure laws, and it preliminarily denies Florida's 
petition.

Written Comments

    Interested persons are invited to comment on this notice. It is 
requested that ten copies be submitted.
    All comments must be limited to 15 pages in length. This limitation 
is intended to encourage commenters to detail their primary arguments 
in a concise fashion. Necessary attachments may be appended without 
regard to the 15-page limit. (49 CFR 553.21.)
    Written comments to the public docket must be received by September 
28, 1994. All comments received before the close of business on the 
comment closing date will be considered and will be available for 
examination in the docket at the above address before and after that 
date. To the extent possible, comments received after the comment 
closing date will also be considered. However, action on the petition 
may proceed at any time after that date. Following the close of the 
comment period, NHTSA will publish a final determination on the 
petition responding to the comments. NHTSA will continue to file 
relevant material in the docket as it becomes available after the 
closing date, and it is recommended that interested persons continue to 
examine the docket for new material. Those persons desiring to be 
notified upon receipt of their comments should enclose, in the envelope 
with their comments, a self-addressed, stamped postcard. Upon receiving 
the comments, the docket supervisor will return the postcard by mail.
    Copies of all comments will be placed in Docket 92-20, Notice 4 of 
the NHTSA Docket Section in Room 5109, Nassif Building, 400 7th Street, 
SW., Washington, D.C. 20590.

    Issued on: August 24, 1994.
John Womack,
Acting Chief Counsel.
[FR Doc. 94-21250 Filed 8-26-94; 8:45 am]
BILLING CODE 4910-59-P