Consumer Federation of California

Legislation carried by Sen. Juan Vargas that seeks to alter a complex law governing vehicle history reports stalled in a Senate committee Tuesday after more than half of the members did not vote.

The San Diego Democrat was seeking to allow car dealers to draw data from various sources to comply with a new law that goes into effect July 1.

That first-in-the-nation law requires car dealers to post red warning stickers if a vehicle had been in a flood, sold as scrap, was a lemon buyback or if an insurance company had previously declared it totaled.

Dealers rely on records stored in the National Motor Vehicle Title Information System maintained by the U.S. Department of Justice. The federal website also steers consumers to various vendors, including San Diego-based ‘InstaVIN,’ that will do the history search for a fee starting at $2.99.

CARFAX and AutoCheck, the industry giants, are not part of that database. They argue dealers and car buyers should be allowed to draw on all records to get as complete a report as possible.

‘The market should decide. I don’t think the government should decide,’ Vargas said.

Vargas and his supporters contended that the federal database does not contain vital information, such as open recalls, some wrecks and air bag deployments. Some consumer advocates counter it’s the CARFAX reports that are flawed.

Jim Irish, chief executive officer of InstaVIN in San Diego, told senators that the new law opened the door to more choices for car buyers by giving them a place to order history reports from various companies at lower costs.

After 90 minutes of debate, the nine-member Senate Transportation and Housing Committee deadlocked 2-2. Senators Christine Kehoe, D-San Diego, and Mark Wyland, R-Solana Beach, abstained.