A BILL TO BE ENTITLED
AN ACT to require the division of motor vehicles to implement a statewide electronic lien system to process the notification and release of security interest and certificate of title data.
The General Assembly of North Carolina enacts:
SECTION 1.  Article 3 of Chapter 20 of the General Statutes is amended by adding a new section to read:
"§ 20‑58.4A.  Electronic lien system.
(a)	Implementation. – By no later than July 1, 2014, the Division shall implement a statewide electronic lien system to process the notification, release, and maintenance of security interests and certificate of title data where a lien is notated, through electronic means instead of paper documents otherwise required by this Chapter. The Division shall contract with a qualified vendor to implement this statewide electronic lien system.
(b)	Minimum Standards for Vendor. – When contracting with a qualified vendor to implement the system required in subsection (a) of this section, the Division shall set the following minimum standards:
(1)	The contract entered into with a vendor shall include no costs or charges payable by the Division to the vendor. The vendor shall reimburse the Division for documented reasonable implementation costs directly associated with the establishment and ongoing support of the statewide electronic lien system.
(2)	Upon implementation of the electronic lien system pursuant to subsection (a) of this section, the qualified vendor may charge participating lienholders and their agents a per‑transaction fee in an amount not to exceed eight dollars ($8.00) for costs associated with the administration of the electronic lien system. To recover the cost of this per‑transaction fee, participating lienholders and their agents may charge the borrower of a motor vehicle loan or the lessee of an automotive lease a fee in an amount not to exceed eight dollars ($8.00) for each electronic transaction where a lien is notated.
(3)	A qualified vendor shall have experience in directly providing electronic lien services to both lienholders and State motor vehicle departments or agencies.
(c)	Mandatory Participation. – Beginning July 1, 2015, all individuals and lienholders who are normally engaged in the business or practice of financing motor vehicles shall utilize the electronic lien system implemented in subsection (a) of this section to record information concerning the perfection and release of a security interest in a vehicle.
(d)	Effect of Electronic Notice or Release. – An electronic notice or release of a security interest made through the electronic system implemented pursuant to subsection (a) of this section shall have the same force and effect as a notice or release on a paper document provided under G.S. 20‑58 through G.S. 20‑58.8.
(e)	Rules. – The Division shall adopt rules implementing the provisions of this section."
SECTION 2.  Prior to the statewide implementation of the electronic lien system pursuant to G.S. 20‑58.4A, the Division, along with the qualified vendor and up to five lienholders, may conduct a pilot program of the electronic lien system for a period of up to 90 days.
SECTION 3.  By no later than October 1, 2013, the Division shall report to the Chairs of the Joint Legislative Transportation Oversight Committee on the status of the implementation of the electronic lien system pursuant to G.S. 20‑58.4A. The report shall include, at a minimum, the costs, benefits, and feasibility of implementing a statewide electronic lien system.
SECTION 4.  This act is effective when it becomes law.