SB1029 - Vehicle lien sales: proceeds.

Enrolled August 25, 2026 Passed IN Senate August 24, 2026 Passed IN Assembly August 20, 2026 Amended IN Assembly August 13, 2026 Amended IN Assembly June 23, 2026 CALIFORNIA LEGISLATURE— 2025–2026 REGULAR SESSION Senate Bill No. 1029 Introduced by Senator Seyarto (Coauthors: Senators Jones and Ochoa Bogh) February 10, 2026 An act to amend, repeal, and add Section 3073 of the Civil Code, relating to liens, and making an appropriation therefor. LEGISLATIVE COUNSEL'S DIGEST SB 1029, Seyarto. Vehicle lien sales: proceeds. Existing law establishes the Motor Vehicle Account in the State Transportation Fund and requires moneys in the account, upon appropriation by the Legislature, be expended by the Department of Motor Vehicles and the Department of the California Highway Patrol for the purposes of enforcing laws related to vehicles or the use of highways. Existing law requires a lienholder to comply with specified procedures to conduct a vehicle lien sale. With regards to those procedures, existing law requires that the proceeds of a vehicle lien sale be paid to the lienholder in the amount necessary to discharge the lien and to cover the cost of processing the vehicle, among other requirements. Existing law requires that the balance be forwarded to the Department of Motor Vehicles and requires the balance to be deposited in the Motor Vehicle Account in the State Transportation Fund, as provided. Existing law authorizes any person claiming an interest in the vehicle to file a claim with the Department of Motor Vehicles for any portion of the funds from the lien sale that was forwarded to the department, as provided. Existing law prohibits the Department of Motor Vehicles from honoring any claim unless the claim has been filed within 3 years of the date the funds were deposited in the Motor Vehicle Account. This bill would delete the above-described prohibition against the Department of Motor Vehicles from honoring any claim. The bill would, instead, 3 years after the date the funds were deposited in the Motor Vehicle Account, require the Department of Motor Vehicles to transfer any funds deposited in the Motor Vehicle Account to the Controller and would require the funds to be treated as escheated property. The bill would make the bill’s provisions operative on January 1, 2030. Because this bill would require the balance to be treated as escheated property to the state, and thereby deposited in the Unclaimed Property Fund, which is a continuously appropriated fund, this bill would make an appropriation. Digest Key Vote: 2/3 Appropriation: YES Fiscal Committee: YES Local Program: NO Bill Text The people of the State of California do enact as follows: SECTION 1. Section 3073 of the Civil Code is amended to read: 3073. The proceeds of a vehicle lien sale under this article shall be disposed of as follows: (a) The amount necessary to discharge the lien and the cost of processing the vehicle shall be paid to the lienholder. The cost of processing shall not exceed seventy dollars ($70) for each vehicle valued at four thousand dollars ($4,000) or less, or one hundred dollars ($100) for each vehicle valued over four thousand dollars ($4,000). (b) The balance, if any, shall be forwarded to the Department of Motor Vehicles within 15 days of any sale conducted pursuant to Section 3071 or within five days of any sale conducted pursuant to Section 3072 and deposited in the Motor Vehicle Account in the State Transportation Fund, unless federal law requires these funds to be disposed in a different manner. (c) Any person claiming an interest in the vehicle may file a claim with the Department of Motor Vehicles for any portion of the funds from the lien sale that were forwarded to the department pursuant to subdivision (b). Upon a determination of the Department of Motor Vehicles that the claimant is entitled to an amount from the balance deposited with the department, the department shall pay that amount determined by the department, which amount shall not exceed the amount forwarded to the department pursuant to subdivision (b) in connection with the sale of the vehicle in which the claimant claims an interest. The department shall not honor any claim unless the claim has been filed within three years of the date the funds were deposited in the Motor Vehicle Account. (d) This section shall remain in effect only until January 1, 2030, and as of that date is repealed. SEC. 2. Section 3073 is added to the Civil Code, to read: 3073. The proceeds of a vehicle lien sale under this chapter shall be disposed of as follows: (a) The amount necessary to discharge the lien and the cost of processing the vehicle shall be paid to the lienholder. The cost of processing shall not exceed seventy dollars ($70) for each vehicle valued at four thousand dollars ($4,000) or less, or one hundred dollars ($100) for each vehicle valued over four thousand dollars ($4,000). (b) The balance, if any, shall be forwarded to the Department of Motor Vehicles within 15 days of any sale conducted pursuant to Section 3071 or within five days of any sale conducted pursuant to Section 3072 and deposited in the Motor Vehicle Account in the State Transportation Fund, unless federal law requires these funds to be disposed in a different manner. (c) Any person claiming an interest in the vehicle may file a claim with the Department of Motor Vehicles for any portion of the funds from the lien sale that were forwarded to the department pursuant to subdivision (b). Upon a determination of the Department of Motor Vehicles that the claimant is entitled to an amount from the balance deposited with the department, the department shall pay that amount determined by the department, which amount shall not exceed the amount forwarded to the department pursuant to subdivision (b) in connection with the sale of the vehicle in which the claimant claims an interest. Three years after the date the funds were deposited in the Motor Vehicle Account, the Department of Motor Vehicles shall transfer the funds to the Controller, and the funds shall be treated as escheated property in accordance with Chapter 7 (commencing with Section 1500) of Title 10 of Part 3 of the Code of Civil Procedure. (d) This section shall become operative on January 1, 2030.