In May, the recycling industry saw a new National Motor Vehicle Title Information System (NMVTIS) reporting enforcement effort from the Department of Justice. Unlike previous enforcement efforts that identified businesses that may have been under-reporting, the newest push is focusing on businesses that have not been reporting at all.
In early May, DOJ contacted Alabama businesses who registered for and received NMVTIS identification numbers, but had not reported any records. Similar letters will be going out to businesses in other states as well.
A growing number of states require businesses that handle total loss or salvage vehicles to provide their NMVTIS ID number as part of the state licensure and license renewal processes. In most states, like in Alabama, this is a simple change that doesn’t require a change to state law. Florida, Texas, New Mexico and others have such requirements in place, and similar requirements will likely be put in place in many more states within the next year.
In late 2011, Alabama began requiring recyclers and secondary metal recyclers to register with a state-provided service to report salvage vehicle VINs. After reporting, the business receives a confirmation number, which must be maintained with the vehicles paperwork, allowing them to process the vehicle. The Alabama system is a “red light/green light” system, meaning that if a confirmation number is received, the business can process the vehicle as it would normally. If no confirmation number is issued, all activities with the vehicle must stop. This is a state-specific system, unrelated to the federal NMVTIS system.
Unfortunately, many businesses using the Alabama service believed that by entering the vehicle VIN into the Alabama system, the state was using that information to report to NMVTIS on their behalf, and they stopped reporting to NMVTIS on their own. This was not the case, and many of these businesses have subsequently received a non-reporting notification from the Department of Justice. To complicate matters, there was confusion at the regional level with several Alabama Department of Revenue (DOR) offices believing that the state was reporting for the businesses, and assuring them that they could disregard the DOJ notice. This, too, is not the case. DOJ has been working with the state of Alabama to clarify what activities are being performed with the data that is being collected.
State agencies, such as the Alabama DOR have separate responsibilities and reporting requirements under the NMVTIS rules and regulations than businesses that buy, sell, or control junk, salvage and total loss vehicles. State NMVTIS participation and compliance is unrelated to the reporting requirements of businesses located within that state. Alabama does use NMVTIS information to validate title brands and other information as a part of its titling process, and regularly updates NMVTIS with changes made to Alabama vehicle titles. These are the state requirements, and are separate from collecting the NMVTIS information required from Alabama businesses, so the state cannot report to NMVTIS on behalf of its recyclers.
To be clear, NMVTIS reporting by businesses is a federal requirement separate from state requirements or processes. Georgia is currently the only state that offers a consolidated reporting process for auto recyclers and secondary metal recyclers in that state. Auto Data Direct is the only approved consolidated reporting service provider for Georgia, so NMVTIS reports made through a different provider may make a business compliant on a federal level, but not compliant with the state of Georgia.
DOJ plans to follow up on the Alabama email notifications, and intends to repeat the mailing across the country.
In Alabama, Georgia or any other state, Auto Data Direct can help your businesses get compliant. To verify compliance, find out if you are required to report, to sign up for an account or for help accessing your existing Auto Data Direct NMVTIS account, please call us at 866-923-3123 or email email@example.com..