89th Legislature Regular Session

SB 2245

Overall Vote Recommendation
Yes
Principle Criteria
Free Enterprise
Property Rights
Personal Responsibility
Limited Government
Individual Liberty
Digest

SB 2245 proposes amendments to Section 501.053 of the Texas Transportation Code, refining the procedures by which individuals may obtain a bonded title for a motor vehicle when traditional documentation of ownership is lacking. This bill is particularly aimed at expanding access to legal vehicle ownership in situations where liens are outdated, unenforceable, or the lienholder is no longer in business.

Under current law, individuals may secure a bonded title by filing a surety bond with the Texas Department of Motor Vehicles (TxDMV) if there is no active lien or if all liens have been released. S.B. 2245 expands this to include cases where: (1) liens are more than 10 years old, (2) the lienholder has gone out of business and no successor has claimed the lien, or (3) the applicant can provide adequate evidence that no active interest remains. This adjustment provides greater flexibility for individuals in complex vehicle title situations, especially in private sales or inherited vehicle cases.

The bill also imposes additional procedural safeguards. It requires the TxDMV to notify any recorded owner or lienholder when a bond is filed, and if the applicant is not a licensed vehicle dealer, the department must wait 30 days before issuing the title. During this period, any party with a valid claim may object, blocking title issuance. However, even if no objection is filed, the bill clarifies that interested parties still retain the right to sue on the bond if they later discover a breach or improper claim.

The bill aims to modernize vehicle title procedures, offer clarity to individuals who acquire vehicles through informal means, and preserve due process rights for creditors or prior owners.

Author
Royce West
Sponsor
Terry Canales
Fiscal Notes

According to the Legislative Budget Board (LBB), SB 2245 is not expected to have a significant fiscal impact on the State of Texas. The bill’s procedural changes regarding the issuance of bonded titles can be implemented by the Texas Department of Motor Vehicles (TxDMV) within the scope of its current operational and financial capacity. Any minor administrative costs incurred, such as for notifying lienholders, managing additional documentation, or processing objections, are anticipated to be absorbed using existing agency resources.

The bill also does not impose any financial burdens or administrative mandates on local governments. There are no required changes to county clerk operations, vehicle tax assessments, or local registration systems, and therefore, the legislation is considered to have no fiscal implication at the local government level.

In short, SB 2245 is fiscally neutral and administratively feasible, making it a low-cost statutory update that expands public access to bonded titles without drawing on additional public funds or requiring new appropriations.

Vote Recommendation Notes

SB 2245 provides a well-calibrated update to the Texas Transportation Code’s procedures for obtaining a bonded title, aimed at reducing fraud and improving due process without expanding the scope of government. The bill enhances protections for lienholders and prior vehicle owners by requiring notice and a 30-day objection period before title issuance, while simultaneously offering a path to legal ownership for individuals who acquire vehicles without formal documentation under specific, verifiable circumstances.

Crucially, the bill does not increase the size or authority of the state government. It operates entirely within the existing administrative framework of the Texas Department of Motor Vehicles (TxDMV), leveraging current agency operations rather than creating new bureaucracies or enforcement mechanisms. The Legislative Budget Board confirms that any associated administrative costs can be absorbed using existing resources, and no additional taxpayer funding, appropriations, or new fees are required.

The regulatory impact of the bill is minimal and narrowly tailored. It adds reasonable procedural safeguards—like the 30-day waiting period and notice requirement—but only applies them to non-dealer individuals seeking a bonded title, not the general public or licensed motor vehicle dealers. These steps are designed to deter fraud and unauthorized title transfers, rather than to impose broad or burdensome regulations.

In sum, SB 2245 upholds all five core liberty principles: it enhances individual liberty and personal responsibility, facilitates legal market participation (supporting free enterprise), protects private property rights through procedural fairness, and maintains limited government by avoiding any expansion in size, scope, or taxpayer impact. The bill is practical, modest in scope, and thoughtfully crafted to resolve a specific set of title ownership challenges in a fiscally and administratively responsible manner. As such, Texas Policy Research recommends that lawmakers vote YES on SB 2245.

  • Individual Liberty: The bill expands the ability of individuals to obtain legal ownership of a vehicle when traditional paperwork is missing, particularly in situations where a lienholder no longer exists. This gives people more freedom to use and transfer vehicles they rightfully possess. By providing a lawful path to ownership without excessive red tape, the bill affirms individuals' rights to their property and mobility.
  • Personal Responsibility: The bill strengthens personal responsibility by requiring applicants to provide evidence of ownership circumstances and to post a surety bond, which serves as protection for any rightful prior owners or lienholders. It also includes a waiting period and allows objections, encouraging people to take proper legal steps and be accountable when claiming vehicle ownership.
  • Free Enterprise: By clarifying and simplifying how bonded titles can be obtained, the bill makes it easier for vehicles to re-enter the market legally. This benefits small businesses (like independent mechanics or used car buyers) and individual buyers who acquire untitled vehicles. Ensuring more vehicles have clear, transferable titles supports market efficiency and transparency.
  • Private Property Rights: The bill strikes a fair balance between the current possessor of a vehicle and any previous owners or lienholders. It protects the property rights of all parties by introducing a notification and objection process, while still allowing legitimate claimants to pursue ownership. It also maintains the right for interested parties to recover on the bond even after a title is issued, ensuring that no one’s property is taken unjustly.
  • Limited Government: The bill does not create new agencies, regulations, or costs. It builds on an existing process, adding narrowly focused safeguards without expanding the size or reach of government. The fiscal note confirms it imposes no additional cost to taxpayers. The bill’s approach reflects responsible governance: resolving problems through clear rules without overreach.
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