Montana committee hears bill to remove notary requirement for vehicle title transfers

HELENA — The House Transportation Committee on Wednesday heard testimony on House Bill 165, a red-tape reduction proposal that would remove a statewide notary requirement for many vehicle title transfers and allow an affidavit (an unsworn declaration) in place of a notarized signature.

Representative Neil Welch, sponsor of HB165, told the committee the measure is “a consumer friendly red tape reduction bill that will allow unencumbered commerce in the purchase and selling of title vehicles” and said the bill references statute 1-6-105 to authorize unsworn declarations under penalty of perjury.

Proponents representing high-volume sellers and lenders said removing the notary requirement would speed transactions that currently stall when a notary is unavailable. Grace Berner of Enterprise Holdings Inc., testifying for Enterprise and Montana credit unions, said Enterprise sells “thousands of cars a year in Montana” and that the change would “streamline the sale or transfer process.” Sam Sill of the Montana Bankers Association and Shane Scanlon of the Montana Independent Bankers Association said banks and rural customers also face delays when notaries are not available. Bruce Knudson of the Montana Auto Dealers Association said dealers nationwide report little fraud tied to removing notarization and that electronic titling is imminent.

Michael Walker, bureau chief for the Motor Vehicle Division, testified as a proponent and described a near-term technology upgrade intended to reduce fraud risk. Walker said the division is completing a new system that will report ownership and title data in real time, is connected to the Criminal Justice Information System for stolen-vehicle alerts, and will go live after about 20 more days of work. He told the committee he reviewed other states that removed notary requirements and found no widespread adversities; he named Colorado, Oregon, Mississippi, North Dakota and Nebraska as states his office consulted.

Committee members asked how the bill would prevent someone who does not own a vehicle from selling it without being identified. Walker and industry witnesses said the affidavit, statutory penalties for false statements and electronic checks tied to the new system are intended to address those concerns; witnesses also noted that some fraud schemes now involve VIN switching, which the new electronic checks help detect. Senator Olson repeatedly pressed witnesses on how a buyer or lender would verify the seller’s identity absent an in-person ID check and the panel discussed how banks and dealers commonly use in-house notarization and other safeguards today.

Julie Lake of the Secretary of State’s office appeared as an informational witness. No formal committee vote on HB165 was recorded during the hearing.

The hearing record shows support from auto sellers, banks and Motor Vehicle Division staff and questions from several committee members about identity verification and fraud prevention as the state transitions to an electronic titling environment.