House Appropriations Committee favorably reports DMV bill S.326, raising Smugglers' Notch fines and doubling some towing reimbursements

The House Appropriations Committee voted May 15 to favorably report S.326, a Department of Motor Vehicles bill that updates state vehicle and vessel rules, raises penalties for illegal entry at Smugglers' Notch and increases the towing reimbursement for abandoned vehicles on public property. Committee members agreed to send the measure to the full House for consideration.

Damien Leonard of the Office of Legislative Counsel walked the panel through the bill section by section, noting most of the measure is technical modernization. "There's a non-driver ID card section here, which is really just bringing us into alignment with some of the federal requirements around the federal REAL ID program," Leonard said, and he explained other updates to payment methods, duplicate-title delivery, and inspection rules.

The most prominent substantive changes include steeper Smugglers' Notch penalties and a change to the towing reimbursement. Leonard described the penalty structure: the base fine for entering the notch in an oversized vehicle would increase from $1,000 to $10,000, and that fine could reach $20,000 if the violation "substantially impedes the flow" of traffic; repeat offenses within three years would double the penalty. On the towing fund, the bill would raise the amount a towing company may charge the state for removing an abandoned vehicle from public property from about $125 to $250.

Logan Mover of the Joint Fiscal Office said section 11 is the only provision that affects the state's appropriations and estimated a modest fiscal impact from the towing change. "If we assume a consistent rate in the future," Mover said, the change would increase DMV expenditures by about $32,000 per year starting in fiscal year 2027, based on roughly 256 tows in FY25.

Committee members questioned whether the towing change applies to private-property tows; Leonard and Mover clarified it applies to public-property tows. Leonard also outlined the existing statutory process: after a tow, DMV attempts to locate an owner during a 21-day waiting period; if unsuccessful, the towing company may receive a salvage title and pursue sale or scrap, and towing companies may seek reimbursement for storage and related costs.

Other provisions in S.326 would: allow DMV to accept electronic insurance documents and signatures for totaled vehicles; let DMV hand duplicate titles to customers at the counter (rather than requiring mailing); create a one-year non-domicile commercial driver's license for certain foreign nationals or drivers from suspended states; align CDL texting/handheld-device rules with noncommercial drivers; require boat validation stickers be placed within six inches of a vessel's registration number; and require Coast Guard'approved personal flotation devices during cold-weather periods (Nov. 1'May 1) for vessels underway in state waters, with exemptions for Coast Guard'inspected vessels and some hunting/fishing activities.

The bill also clarifies inspection rules (directing the DMV to remove nonsafety concerns from the inspection manual and to adopt interim emergency rules by Aug. 1), creates limited-use categories for specialty vehicles (kit cars, restomods, replicas), prohibits license-plate designs that obscure origin and certain clear covers, and repeals the COVID-era temporary print-at-home registration plates due to fraud concerns. On motorcycle exhaust, the bill would require a muffler or baffle and treat removal of baffling as a failed inspection under the manual.

After the presentation and questions, a committee member moved the bill "favorably" as amended and the clerk called the roll. Named representatives recorded their votes as "Yes" on the record; the committee reported the motion passed and said Representative John (to carry the measure) would bring it to the floor. The committee chair closed by noting upcoming items and adjourned.

The bill now moves to the House floor with the committee's favorable recommendation; the record shows the appropriations impact is limited to the towing reimbursement change and was estimated by the Joint Fiscal Office at about $32,000 per year beginning in FY2027.