A bill

 

TO AMEND THE SOUTH CAROLINA CODE OF LAWS BY AMENDING ARTICLE 1 OF CHAPTER 23, TITLE 50, RELATING TO THE TITLING OF WATERCRAFT AND OUTBOARD MOTORS, SO AS TO DELETE THE REQUIREMENT THAT OUTBOARD MOTORS BE TITLED; BY AMENDING SECTION 50-23-345, RELATING TO A TEMPORARY CERTIFICATE OF NUMBER, SO AS TO MAKE A CONFORMING CHANGE; BY AMENDING SECTION 50-23-375, RELATING TO A VALIDATION DECAL, SO AS TO MAKE A CONFORMING CHANGE; BY AMENDING SECTION 12-37-3210, RELATING TO TAX NOTICES FOR BOATS AND BOAT MOTORS, SO AS TO MAKE A CONFORMING CHANGE; AND BY ADDING ARTICLE 5 TO CHAPTER 23, TITLE 50 SO AS TO PROVIDE FOR THE REGISTRATION OF WATERCRAFT AND OUTBOARD MOTORS.

 

Be it enacted by the General Assembly of the State of South Carolina:

 

SECTION 1.  Article 1, Chapter 23, Title 50 of the S.C. Code is amended to read:

 

Article 1

 

Titling of Watercraft and Outboard Motors

 

    Section 50-23-5. For purposes of this article, "watercraft" means anything used or capable of being used as a means of transportation on the water, including any affixed outboard motor, but does not include: a seaplane regulated by the federal government, water skis, aquaplanes, surfboards, windsurfers, tubes, rafts, and similar devices or anything that does not meet construction or operational requirements of the state or federal government for watercraft.

 

    Section 50-23-10.  Each entity desiring to be a marine dealer shall apply for a permit each year. A permit is valid from January first to December thirty-first. The permit cost is ten dollars. Applications for renewals must be received by December fifteenth each year. A marine dealer shall have an established place of business with a street address separate from a residence. A marine dealer shall have a valid business license and permit for each separate facility. A facility is separate if it is not within the same compound or has a separate street address. Marine dealers who sell new or used watercraft shall sell a minimum of ten watercraft or outboard motors a year in order to renew the permit. A dealer who fails to meet minimum requirements each year may request in writing a review of the permit and sales. After review of the dealer's records and after good cause has been shown by the dealer for not meeting the minimum requirements, the department may renew the permit for the calendar year. Permitted marine dealers may apply for demonstration numbers. Marine dealers permitted under this article consent to inspections of the business and its records during regular business hours by department personnel and other law enforcement officers. A dealer who fails to cooperate with department inspections forfeits his permit. A marine dealer permit is invalid when a change is made to one or more of the following:

    (1) location address;

    (2) federal employer identification number;

    (3) South Carolina tax number;

    (4) ownership; or

    (5) business name.

 

    Section 50-23-11.  (A) Dealer demonstration numbers are limited to watercraft that are:

       (1) held for sale by the dealership or assigned to the dealership, including customer watercraft in for service and watercraft being ferried by the dealership;

       (2) being operated for limited demonstration rides by prospective buyers;

       (3) being operated for purposes of buyer demonstration by owners, employees, or corporate officers of the dealership;

       (4) being tested for service by the dealership;

       (5) being temporarily operated by an established customer whose boat is being repaired;  and

       (6) valid from the date of issue until December thirty-first inclusive of each year.

    (B) The demonstration numbers must not be permanently attached to the vessel but must be on board at all times. Marine dealers who sell watercraft are allowed nine demonstration numbers. Marine dealers who only service watercraft or outboard motors are allowed one demonstration number.

    If a dealer allows the operation of a watercraft with demonstration numbers, the dealer shall execute a form identifying the date and time, the specific watercraft, the dealer's permit number, the demonstration number, the purpose for which the watercraft is being operated and if for a prospective sale, the form must include the name of the prospective buyer, the date, the specific watercraft, the dealer's permit number, and the demonstration number. The form and the dealer demonstration number must be on board during operation but need not be attached. Operations with dealer demonstration numbers are limited to seventy-two consecutive hours. This form is not required of owners, employees, or corporate officers who carry dealer identification and who are authorized to use demonstration numbers as provided herein.

    (C) All owners, employees, or corporate officers authorized to demonstrate dealer watercraft using demonstration numbers must be listed on the dealer permit application form. The list must be updated as employees are added or deleted within thirty days of a change. Owners, employees, or officers not listed may not use demonstration numbers.

    (D) It is unlawful to misuse dealer demonstration numbers or allow dealer demonstration numbers to be misused. A person convicted of misusing or allowing the misuse of dealer demonstration numbers is guilty of a misdemeanor and, upon conviction, for a first offense must be fined not more than five hundred dollars. For a second offense within three years of the first conviction, the offender must be fined at least two hundred dollars but not more than five hundred dollars. The dealer demonstration numbers are suspended for one year and must be surrendered to the department.

    (E) The fee for a dealer demonstration number is thirty dollars and the fee must accompany the application for each demonstration number. Demonstration numbers expire on December thirty-first of each year or on the same date the marine dealer permit under which they were issued is voided, surrendered, or revoked. All revenue from each demonstration number must be used to support the Marine Investigations section of the department.

    (F) Manufacturer demonstration numbers are limited to watercraft that are being operated for the purpose of testing. Manufacturer demonstration numbers are valid from the date of issue until December thirty-first inclusive of each year.

    (G) A person does not violate the provisions of Section 50-23-190 relating to possessing or operating a watercraft without a proof of title if the person possesses appropriate demonstration numbers for the watercraft.

 

    Section 50-23-12.  A permitted marine dealer that accepts any watercraft or outboard motor as a trade-in must obtain from the owner a completed change in status form indicating the trade-in. The dealer must submit the form to the department within thirty days in the manner prescribed.

 

    Section 50-23-20.  Any watercraft or outboard motor, or both, held or principally used in this State must be titled by the department. An owner of a watercraft or outboard motor titled in this State must notify the department within thirty days if ownership is transferred to another person, entity, or transferred out of state or otherwise disposed.

 

    Section 50-23-24.  Neither the owner of a boat livery nor his agent or employees may permit any of his vessels to depart from his premises unless it is registered properly, numbered, and titled.

 

    Section 50-23-30.  Watercraft documented by the United States Coast Guard or its predecessor or successor agency and water skis, aquaplanes, surfboards, windsurfers, and similar devices, and those watercraft propelled exclusively by human power, and an outboard motor of the watercraft are not required to be titled.

 

    Section 50-23-35.  (A) No title for a watercraft or outboard motor may be issued by the department if currently titled in this State or titled or registered in another state unless it is accompanied by a receipt from the applicant''s appropriate county official stating payment of ad valorem taxes due for the tax year in which the ownership was initiated has been paid. Applications submitted more than one year after ownership was initiated must be accompanied by paid tax receipts for all subsequent years up to the date the application was accepted by the department.

    (B) A title for a watercraft or outboard motor sold by a permitted marine dealer is exempt from the requirement for a paid tax receipt and may be titled by the department without the receipt indicating ad valorem taxes have been paid. The department must transmit daily a list of the titles and certificates of registration issued under this exemption to the respective county official for collection of ad valorem taxes.

    (C) No receipt is required for a watercraft or outboard motor designated as exempt from ad valorem taxes by the appropriate county official, provided that each county makes such a determination when a watercraft or outboard motor is titled in their respective county.

 

    Section 50-23-55.  (A) A certificate of title to a watercraft or outboard motor is prima facie evidence of ownership of a watercraft or outboard motor. All watercraft and outboard motors subject to the titling requirements of this chapter must be titled.

    (B) No person may acquire a watercraft or outboard motor, subject to the titling requirements of this chapter, without obtaining a certificate of title or in the case of a new watercraft or outboard motor a manufacturer's or importer's statement of origin reflecting the person acquiring the watercraft or outboard motor as the original purchaser as provided in this chapter. In the case of watercraft or outboard motors from other jurisdictions that do not require titling, a bill of sale and proof of registration may be substituted for the title.

    (C) No person may dispose of a watercraft or outboard motor subject to the titling provisions of this chapter without transferring to the person acquiring the watercraft or outboard motor a certificate of title reflecting the transfer of the watercraft or outboard motor. In the case of new watercraft, a manufacturer's statement of origin must be delivered to the purchaser. In the case of watercraft or outboard motors from other states or foreign jurisdictions, which do not title such watercraft or outboard motors, a bill of sale and proof of registration may be substituted.

 

    Section 50-23-60.  (A) Every person who acquires a watercraft or outboard motor required to be titled under this chapter shall apply to the department within thirty days of the date of acquisition for a certificate of title for the watercraft or outboard motor accompanied by the required fee and on forms required by the department.  The application must be signed by the person who acquires the watercraft or outboard motor and shall contain:

       (1) the applicant's name, domiciled address, including the county, date of birth, and the county where the watercraft is principally located, state-issued identification number, and state of issue;

       (2) for watercraft, a description of the watercraft, including its make, model, model year, length, the principal material used in construction, hull number, and the manufacturer's engine serial number if an inboard; for an outboard motor, its make, model, model year, or year of manufacture, and horsepower, and manufacturer's serial number;

       (3) the date of acquisition by the applicant, the name and address of the person from whom the watercraft or outboard motor was acquired, and the names and addresses of persons having a security interest in the order of their priority;

       (4) a bill of sale;

       (5) further information reasonably required by the department to enable it to determine whether the owner is entitled to a certificate of title and the existence or nonexistence of security interests in the watercraft or outboard motor;

       (6) when a Transfer of Death (TOD) beneficiary is designated, each TOD beneficiary's name, domiciled address, including the county, date of birth, state-issued identification number, and state of issue; and

       (7) in the case of one or more TOD beneficiaries receiving the title and registration to a watercraft or outboard motor, a bill of sale shall not be required for the department to issue a title, but such TOD beneficiaries shall establish the death of all owners of the watercraft or outboard motor.

    (B) Every dealer selling or exchanging a watercraft or outboard motor subject to titling under this chapter shall complete the application for a new title in the name of the purchaser before delivering the watercraft or outboard motor to the purchaser. The application shall contain the name and address of a lienholder and the date of the security agreement. It must be signed by the dealer showing the assigned dealer permit number, as well as by the owner, and the dealer shall submit the application to the department within thirty days of the sale. However, permitted marine dealers are not required to obtain titles for new vessels and outboard motors held in their inventory for sale until they are sold or exchanged as long as a proper manufacturer's or importer's statement of origin is held by the dealer. The fees for title and registration may not exceed those required by this article and if requested must be itemized on the bill of sale to the new owner. This does not prohibit a dealer from charging an administrative fee for processing title and registration.

    (C) If a dealer buys or acquires a used watercraft or outboard motor for resale and the watercraft or outboard motor is already covered by a certificate of title which is surrendered to him by the owner or lienholder at the time of delivery of the watercraft or outboard motor, the dealer need not send the certificate to the department at that time. Upon transferring the watercraft or outboard motor to another person, other than by creation of a security interest, within thirty days of sale he shall execute the assignment and warranty of title by a dealer, showing the name and address of the transferee and a lienholder and the date of his security agreement, in the spaces provided, on the certificate to the department with the transferee's application for a new certificate.

    (D) If application for certificate of title is made for a watercraft or outboard motor last owned in another state or foreign country, the application shall contain or be accompanied by:

       (1) the certificate of title issued by the other state or foreign country if any;

       (2) other information or documents the department reasonably requires to establish the ownership of the watercraft or outboard motor and the existence or nonexistence of security interests in it; or

       (3) if the state or foreign country in which the watercraft or outboard motor was last owned does not issue certificates of title, a bill of sale or sworn statement of ownership or evidence of ownership required by the law of the state or foreign country from which the watercraft or outboard motor was brought into this State, and proof of registration plus other information or documents the department reasonably requires to establish the ownership of the watercraft or outboard motor and the existence or nonexistence of security interests in it.

    (E) An application except those from permitted marine dealers presented after thirty days is subject to a late penalty of fifteen dollars.

    (F) An application presented after sixty days is subject to a late penalty of thirty dollars.

 

    Section 50-23-70.  (A) The fee for a certificate of title for a watercraft is ten dollars, and the fee for a certificate of title for an outboard motor is ten dollars.

    (B) If a certificate of number or decals are lost, destroyed, or become illegible, the department may issue a duplicate.

    (C) The fee for providing a duplicate document or decal is five dollars.

    (D) The provisions of this section requiring a fee do not apply to the watercraft owned by volunteer rescue squads used exclusively for the purpose of the squads.

    (E) The department must not issue a duplicate document for a certificate of number decal, certificate of number card, outboard motor decal, or watercraft title decal if the department has notice that ad valorem taxes are due.

    (F) The fee to establish, modify, or revoke a Transfer of Death designation upon a certificate of title for watercraft or outboard motor is ten dollars.

 

    Section 50-23-80.  (A) The department shall file each application for certificate of title which is received by it, provided it is accompanied by the required fee and complies in all other respects with this chapter.  When satisfied that the application is in proper form, that the applicant is the owner of the watercraft or outboard motor, and that there is no security interest in the watercraft or outboard motor not disclosed in the application, the department shall issue a certificate of title to the watercraft or outboard motor.

    (B) The department shall maintain a record of all certificates of title issued by it:

       (1) Under a distinctive title number assigned to a watercraft or outboard motor;

       (2) Under the identification number awarded to a watercraft in accordance with the registration and numbering act of the state in which it is registered.  If the State requires outboard motors to be registered separately, the department shall keep the motor registration numbers in its titling records;

       (3) Alphabetically, under the name of the owner; and

       (4) In the discretion of the department, in any other method it determines.

    (C) All records of the department relating to the titling of watercraft or outboard motors shall be public records.

    (D) If the department is not satisfied that the applicant for a certificate of title to a watercraft or outboard motor is the bona fide owner of such watercraft or outboard motor and that there is no security interest in it not disclosed in the application, the department shall withhold the issuance of a certificate of title until the applicant reasonably satisfies the department that the applicant is the owner of the watercraft or outboard motor and that there are no undisclosed security interests in it.

 

    Section 50-23-90.  (a)(A) Each certificate of title issued by the department shall contain:

       (1) the date issued;

       (2) the name and address of the owner;

       (3) the names and addresses of any lienholders, in the order of priority as shown on the application or, if the application is based on a certificate of title, as shown on the certificate;

       (4) the title number assigned to the watercraft or outboard motor;

       (5) a description of the watercraft or outboard motor, including its make, model, model year, or year of manufacture, horsepower, registration number, and manufacturer's serial number or, hull number assigned to the watercraft by the department, length, and the principal material used in construction;

       (6) on the reverse side of the certificate, spaces for assignment of title by the owner or by the dealer and for a warranty that the signer is the owner and that there are no mortgages, liens, or encumbrances on the watercraft or outboard motor except as are noted on the face of the certificate of title;

       (7) information of whether Transfer of Death beneficiary designations have been filed with the department; and

       (8) any other data the department prescribes.

    (b)(B) A certificate of title issued by the department is prima facie evidence of the facts appearing on it.

 

    Section 50-23-110. (a)(A) No dealer shall acquire a new watercraft or outboard motor without obtaining from the seller a manufacturer's or importer's statement of origin.

    (b)(B) No manufacturer, importer, dealer, or other person shall sell or otherwise dispose of a new watercraft or outboard motor to a dealer without delivering to the dealer a manufacturer's or importer's statement of origin.

    (c)(C) The manufacturer's or importer's statement of origin must be a uniform or standardized form prescribed by the department and must contain:

       (1) for a watercraft, the description of watercraft including its make, year of manufacture, or model year, and manufacturer's hull identification number, length, and construction, for an outboard motor the description including its make, model, year of manufacture, or model year, manufacturer's serial number, and horsepower;

       (2) certification of date of transfer of watercraft or outboard motor, and name and address of transferee;

       (3) certification that this was a transfer of watercraft or outboard motor in ordinary trade and commerce;

       (4) the signature and address of a representative of the transferor; and

       (5) on the reverse side of each manufacturer's or importer's statement of origin an assignment form, including the name and address of the transferee, a certification that the watercraft or outboard motor is new, and a warranty that the title at the time of delivery is subject only to liens and encumbrances set forth and described in full in the assignment.

 

    Section 50-23-120. (a)(A) The owner at the time of delivery of the watercraft or outboard motor shall execute the assignment and warranty of title to the transferee in the space provided on the back of the certificate of title. If the title is voided, due to a change, cancellation of an assignment on a title due to error, or failure of a purchase to materialize the owner, shall make application for a duplicate title within thirty days.

    (b)(B) The transferee or purchaser shall obtain a new certificate of title by application to the department accompanied by the required fee and upon the form or forms prescribed and furnished by the department. This application for certificate of title must be filed within thirty days after the delivery to him of the watercraft or outboard motor.

 

    Section 50-23-125. (A) In lieu of paper documents, the department is authorized to transmit and receive the following information through secure electronic means for a certificate of title:

       (1) the title for a watercraft or outboard motor with any liens or security interests;

       (2) to the first lienholder on the title, the addition of subsequent liens; and

       (3) the discharge of a security interest or lien from a lienholder on the title.

    The certificate of title record must contain the same information noted on a paper certificate of title.  Upon receipt of the discharge of the final lien, a clear title must be printed and conveyed to the owner at the address on file with the department.  The provisions of this section do not alter the priority of lienholders and encumbrances against a certificate of title.  A duly certified copy of the department's electronic record of the lien is admissible in a civil, criminal, or administrative proceeding as evidence of existence of the lien.

    (B) The department is authorized to collect an electronic transaction fee not to exceed five dollars for each transaction from commercial parties who transmit or retrieve data from the department pursuant to this section. The fee collected by the department is an official fee and must be used to defray the expenses of the electronic lien program.

    (C) Notwithstanding Sections 37-2-202 and 37-3-202, commercial entities and lenders who transmit or receive data from the department pursuant to the provisions of this section may collect an electronic transfer fee not to exceed five dollars for each transaction from the owners of watercraft or outboard motors. A fee charged by the department related to a titled watercraft or outboard motor for the purposes of transmittal or retrieval of this data is deemed an official fee as referenced in Sections 37-2-202 and 37-3-202.

    (D) All businesses and commercial lenders who are regularly engaged in the business or practice of selling watercraft or outboard motors as a licensed dealer pursuant to this chapter or in the business or practice of financing watercraft or outboard motors shall utilize the electronic lien system to transmit and retrieve electronic lien information. The department shall maintain contact information on its website for service providers utilizing an electronic interface between the department, lienholders, and sellers of watercraft or outboard motors. The department must establish procedures to ensure compliance with the use of the electronic lien system and provide for valid exceptions as determined by the department.

 

    Section 50-23-130. (a)(A) If the ownership of a watercraft or outboard motor is transferred by operation of law, such as by inheritance, Transfer on Death, devise or bequest, order in bankruptcy, insolvency, replevin, or execution sale, or satisfaction of mechanic's lien, or repossession upon default in performance of the terms of a security agreement, the transferee shall, except as provided in subsection (b), promptly mail or deliver to the department the last certificate of title, if available, or the manufacturer's or importer's statement of origin or, if that is not possible, satisfactory proof of the transfer of ownership, and his application for a new certificate of title accompanied by the required fee, and upon the appropriate form or forms prescribed and furnished by the department.

    (b)(B) If the ownership of a watercraft or outboard motor is terminated in accordance with the terms of a security agreement by a lienholder named in the certificate of title, the transferee shall promptly mail or deliver to the department the last certificate of title, his application for a new title accompanied by the required fee and upon the form or forms prescribed and furnished by the department, and an affidavit by the lienholder or his authorized representative, setting forth the facts entitling him to possession and ownership of the watercraft or outboard motor, together with a copy of the journal entry, court order or instrument upon which such claim of possession and ownership is founded.  If the lienholder cannot produce such proof of ownership, he may submit such evidence as he has with his application to the department, and the department may, if it finds the evidence to be satisfactory proof of ownership, issue a new certificate of title.

    (c)(C) If a lienholder succeeds to the interest of an owner in a watercraft or outboard motor by operation of law and holds such watercraft or outboard motor for resale, he need not secure a new certificate of title thereto but, upon transfer to another person, shall promptly mail or deliver to the transferee or to the department the certificate, affidavit and such other documents as the department may require.

 

    Section 50-23-140. (a)(A) If a lien or encumbrance is first created at the time of transfer, the certificate of title must be retained by or delivered to the lienholder or retained electronically or delivered to the lienholder electronically. All liens, mortgages, and encumbrances noted upon a certificate of title take priority according to the order of time in which they are noted on it by the department.  All such liens, mortgages, and encumbrances must be valid as against the creditors of the owner of a watercraft or outboard motor, whether armed with process or not, and against subsequent purchasers of any such watercraft or outboard motor, or against holders of subsequent liens, mortgages, or encumbrances upon the watercraft or outboard motor.

    (b)(B) When a lien is discharged, the holder shall note that fact on the face of the certificate of title or discharge the lien electronically through the system prescribed by the department.  If the lienholder holds a paper certificate of title, within thirty days of discharging the lien, the holder shall present it to the department.

    (c)(C) A security interest is perfected by the delivery to the department of the existing certificate of title, if any, an application for a certificate of title containing the name and address of the lienholder and the date of the security agreement, and the required fee. It is perfected as of the time of its creation if the delivery is completed within thirty days of its creation, otherwise, as of the time of the delivery.

    (d)(D) If the person acquires a watercraft or outboard motor and the title shows an outstanding lien and neither the department nor the transferee can verify the existence of the lien, the transferee may provide proof of an attempt to notify the lienholder of record of the transfer and the attempt to verify the existence of the lien by certified mail and if the lienholder of record does not respond within thirty days of the attempted notice, the lien is unenforceable and the department shall issue a title clear of the lien.

    (e)(E) If an owner of a watercraft or outboard motor attempts to verify the existence of a lien and neither the owner nor the department can verify the existence, the owner may provide proof of an attempt to notify the lienholder of record to verify the existence of the lien by certified mail and if the lienholder of record does not respond within thirty days of the attempted notice, the lien is unenforceable and the department shall issue a title clear of the lien.

 

    Section 50-23-150. (a)(A) If a certificate of title is lost, stolen, mutilated or destroyed or becomes illegible, the first lienholder or, if none, the owner or legal representative of the owner named in the certificate, as shown by the records of the department, may obtain a duplicate by application to the department, furnishing such information concerning the original certificate and the circumstances of its loss, mutilation or destruction as may be required by the department.

    (b)(B) The duplicate certificate of title shall be a certified copy plainly marked "duplicate" across its face. It shall be mailed to the first lienholder named in it or, if none, to the owner.

    (c)(C) In case an original certificate of title is mutilated or rendered illegible, such mutilated or illegible certificate shall be returned to the department with the application for a duplicate.

    (d)(D) In the event a lost or stolen original certificate of title for which a duplicate has been issued is recovered, it shall be surrendered promptly to the department for cancellation.

 

    Section 50-23-170. (A) If a watercraft contains a permanent identification number placed on it by the manufacturer, the manufacturer's serial number must be used as the builder's hull number.  If there is no manufacturer's serial number, if the manufacturer's serial number has been removed or obliterated, or if the watercraft is homemade, the department, upon application, shall assign a permanent identification number which must be used as the builder's hull number for the watercraft.  This assigned number must be affixed permanently to or imprinted by the applicant at the place and in the manner designated by the department upon the watercraft for which the builder's hull number is assigned. "Homemade watercraft or outboard motor" means a watercraft or outboard motor which is built by an individual for personal use from raw materials which does not require the assignment of a federal hull identification number or serial number by a manufacturer pursuant to federal law. An individual may build or furnish raw materials to a builder under a contract to build a homemade watercraft or outboard motor to desired specifications.  A copy of the contract, specifications, and bill of sale for raw materials must accompany registration and title application. The person furnishing materials under a contract may be considered the builder. A rebuilt or reconstituted watercraft or outboard motor must not be construed to be homemade. Every homemade watercraft must be certified as meeting safety standards of the United States Coast Guard before it can be sold by the builder. Certification must be furnished to the purchaser and a copy accompany applications for transfer to the department.

    (B) Every outboard motor must have a permanent identification number placed on it in at least two locations by the manufacturer. This number must be used as the serial number. If there is no manufacturer's serial number or if the manufacturer's serial number has been removed for a valid reason or obliterated, the department, upon a prescribed application, may assign a serial number for the outboard motor. This assigned serial number must be affixed permanently to or imprinted by the applicant at the place and in the manner designated by the department upon the outboard motor for which the serial number is assignedReserved.

    (C) No newly-manufacturednewly manufactured watercraft or outboard motor may be sold or offered for sale by a person in this State unless the watercraft or outboard motor has a hull identification number or serial number permanently affixed, and the number also must be affixed permanently in a hidden place.

    (D) Manufacturer's serial numbers or hull identification numbers for watercraft must be imprinted clearly in the stern transom knee or other essential hull member near the stern by stamping, impressing, or marking with pressure or for an inboard watercraft on the main inside beam. In lieu of imprinting, the manufacturer's serial number or hull identification number may be displayed on a plate in a permanent manner. In addition to being permanent the number must be accessible.  Hull identification or serial numbers must be installed according to United States Coast Guard regulations. If the serial number or hull identification number is displayed in a location other than on or near the stern transom, the department must be notified by the manufacturer as to the location.

    (E) No person may destroy, remove, alter, cover, or deface the manufacturer's serial number or hull identification number or part of it, or plate bearing the number, or a serial number or hull identification number or part of it assigned by the department or be in possession of an affected watercraft or outboard motor unless authorized in writing by the department and the Commandant of the United States Coast Guard.

 

    Section 50-23-180. (a)(A) Every law enforcement agency, peace officer, owner, or insurer in the State, having knowledge of a stolen or converted watercraft or outboard motor, immediately shall furnish the department with full information concerning the theft or conversion.

    (b)(B) The department, whenever it receives a report of the theft or conversion of a watercraft or outboard motor, shall make a record of it, including the make of the stolen or converted watercraft or outboard motor and its hull number or serial number, and shall file the same in the numerical order of the hull number or serial number with the index records of the watercraft or outboard motors of such make. The department shall prepare a report listing watercraft and outboard motors stolen and recovered as disclosed by the reports submitted to it, to be distributed as it deems advisable.

    (c)(C) In the event of the recovery of a stolen or converted watercraft or outboard motor, the owner or insurer immediately shall notify the department in writing.

    (d)(D) Law enforcement agencies shall notify the department of recovery of any stolen watercraft or outboard motor immediately.

 

    Section 50-23-185. Any law enforcement officer may inspect a junkyard, scrap metal processing facility, salvage yard, marina, repair shop, boat yard, dry dock, licensed business buying, selling, displaying, trading watercraft or outboard motors, new and used or parts of watercraft and outboard motors, or both, parking lots, and public garages or any other person dealing with salvaged watercraft or outboard motors or parts of them.

    The physical inspection must be conducted while an employee or owner is present and must be for the purpose of locating stolen watercraft or outboard motors, investigating the titling or registration of watercraft or outboard motors wrecked or dismantled.

 

    Section 50-23-190. No person may:

    (1) be in possession of or operate on the waters of this State a watercraft or an outboard motor for which a certificate of title is required unless a certificate of title has been issued to the owner;

    (2) be in possession of or operate on the waters of this State a watercraft or an outboard motor for which a certificate of title is required upon which the certificate of title has been canceled;

    (3) be in possession of or operate on the waters of this State a sailboat or outboard motor required to be titled without properly displaying the title decal;

    (4) sell, transfer, or otherwise dispose of a watercraft or an outboard motor without delivering to the purchaser or transferee a certificate of title or a manufacturer's or importer's statement of origin assigned to the purchaser or transferee as required by this chapter;

    (5) fail to surrender to the department a certificate of title upon cancellation of the title by the department for a valid reason set forth in this chapter or regulations adopted pursuant to it; or

    (6) dispose of a rejected or defective watercraft hull or outboard motor in the manufacturing process except by upgrading the hull to meet United States Coast Guard requirements or destroying the hull or outboard motor.

 

    Section 50-23-200. No person may:

    (1) alter, forge, or counterfeit a certificate of title or manufacturer's or importer's statement of origin for a watercraft or for an outboard motor;

    (2) alter or falsify an assignment of a certificate of title, or an assignment or cancellation of a security interest on a certificate of title to a watercraft or to an outboard motor;

    (3) hold or use a certificate of title to a watercraft or to an outboard motor nor hold or use an assignment or cancellation of a security interest on a certificate of title to a watercraft or to an outboard motor knowing it to have been altered, forged, counterfeited, or falsified;

    (4) have possession of, buy, receive, sell or offer for sale, or otherwise dispose of a watercraft or an outboard motor knowing or having reason to believe the watercraft or outboard motor has been stolen. No person may procure or attempt to procure a certificate of title to a watercraft or an outboard motor or pass or attempt to pass a certificate of title or an assignment to a watercraft or an outboard motor knowing or having reason to believe the watercraft or the outboard motor has been stolen;

    (5) have possession of, buy, receive, sell or offer for sale, or otherwise dispose of in this State a watercraft or an outboard motor on which a manufacturer's hull identification number or part of it or assigned serial number has been destroyed, removed, covered, altered, or defaced, knowing or having reason to believe of the destruction, removal, covering, alteration, or defacement of the manufacturer's hull identification number or part of it or assigned serial number; or

    (6) destroy, remove, cover, alter, or deface the manufacturer's hull identification number or part of it or assigned serial number on a watercraft or an outboard or inboard motor.

 

    Section 50-23-201. (A) Any person or entity that attempts to obtain a certificate of title, certificate of number or decals by fraud or misrepresentation or who obtains a certificate of title or certificate of number or decals by fraud or misrepresentation is guilty of a misdemeanor and, upon conviction, must be fined five hundred dollars or imprisoned not more than thirty days, or both.

    (B) Any certificate or decal obtained by fraud or misrepresentation is void.

 

    Section 50-23-205. (A) A stolen or abandoned, junked, adrift, destroyed, or salvaged watercraft or outboard motor, a watercraft or outboard motor for which the true owner is not determined, or a watercraft or outboard motor on which the manufacturer's or assigned serial number has been destroyed, removed, covered, altered, or defaced may be seized.

    (B) Upon seizure of the watercraft or outboard motor, the department shall notify a person claiming an interest in it, and the person has the right to prove his interest before the circuit court in the county where the property was seized.  If no action is filed within sixty days of notification, the department may retain the property for official use or transfer the property to another public entity for official use, sell the property at public auction, or, if the watercraft or outboard motor is determined to be unsafe, destroy it.  The proceeds derived from the sale must be deposited in the Boating Operating Fund of the department for administration of the program.

    (C) When the department determines the owner of a seized watercraft or outboard motor and related marine equipment, it shall notify the owner by certified mail of the procedure, the location, and the fact that he has not less than thirty days from the date of the certified letter to remove the equipment from the department's storage facility. If a security interest has been perfected, the department must notify the lienholder by certified mail allowing thirty days to respond. Failure to respond within thirty days or remove the watercraft or outboard motor by the date designated forfeits the equipment to the department to be used or disposed of according to law.

 

    Section 50-23-210. (a)(A) The department shall have the authority to suspend or revoke a certificate of title to a watercraft, or to an outboard motor, upon reasonable notice and hearing, when authorized by any other provision of law or if he finds:

       (1) The certificate of title was fraudulently procured or erroneously issued, or

       (2) The watercraft, or outboard motor, has been scrapped, dismantled, or destroyed, or transferred and registered in another state.

    (b)(B) Suspension or revocation of a certificate of title does not, in itself, affect the validity of a security interest noted on it;

    (c)(C) When the department suspends or revokes a certificate of title, the owner or person in possession of it shall, immediately upon receiving notice of the suspension or revocation, mail or deliver the certificate to the department;  or

    (d)(D) The department may seize and impound any certificate of title which has been suspended and revoked.

 

    Section 50-23-220. (A) Except as provided in subsection (B), all fees received and money collected under the provisions of this chapter must be deposited in the State Treasury and set apart in a special fund. Appropriations from this fund must be used for the expenses of the department in administering the provisions of this chapter or for any purpose related to the mission of the department.

    (B) To the extent fees collected pursuant to Section 50-23-70, in connection with titling a boat, are attributable to fee increases beginning July 1, 1999, revenues from those increases must be used by the department for its law enforcement responsibilities. Any surplus may be carried forward for that use.

 

    Section 50-23-230. The department is authorized and empowered to make, adopt, promulgate, amend, and repeal all rules and regulations necessary, or convenient for the carrying out of the duties and obligations and powers conferred on the department by this chapter.

 

    Section 50-23-240. A copy of the regulations adopted pursuant to this chapter, and of any amendments thereto, shall be filed in the office of the board and in the office of the official State record-keeping agency.  Rules and regulations shall be published by the department in a convenient form.

 

    Section 50-23-250. The director, for the purpose of more effectively carrying out the provisions of this chapter, shall have the power to employ and appoint the necessary enforcement officers for enforcement of this chapter. The duties of such enforcement officers shall include but not be limited to investigating applications for certificate of title, inspecting watercraft, or outboard motors, in or at public facilities for purposes of locating stolen property, and investigating and reporting thefts of watercraft, or outboard motors. With respect to the enforcement of the provisions of this chapter, such enforcement officers shall have and may exercise throughout this State all of the powers of peace officers.

 

    Section 50-23-260. The department shall annually, between January first and January thirty-first, furnish to each county auditor a list of motors and watercraft registered and titled pursuant to this chapter in the previous year to residents of such auditor's county, which list shall include the names and addresses of the owners of such watercraft and motors and sufficient additional information as will permit the auditors to identify the chattels titled for tax purposes.

 

    Section 50-23-270. A transfer of a watercraft or outboard motor is subject to this chapter. A person making a false statement in a document or other submission to the department is guilty of a misdemeanor and, upon conviction, must be fined not less than fifty nor more than five hundred dollars or imprisoned not more than thirty days.

 

    Section 50-23-275. A watercraft not previously required to be titled for which a title is required by this chapter must be titled at the time of renewal of the registration of the watercraft or transfer of the watercraft whichever occurs first.  An owner of such a watercraft must secure a title for the watercraft within three years from the effective date of this section.

 

    Section 50-23-280. (A) Unless otherwise specified, a person violating this chapter is guilty of a misdemeanor and, upon conviction, must be fined not less than twenty-five nor more than five hundred dollars or imprisoned not more than thirty days, or both.

    (B) A dealer violating this chapter is guilty of a misdemeanor and, upon conviction, must be fined not less than twenty-five dollars for the first offense, and not less than one hundred dollars for a second offense within two years. For the second and subsequent offenses, the dealer's permit must be suspended for ninety days. Any demonstration numbers must be surrendered to the department. A dealer who submits a fraudulent document or payment to the department must be suspended for ninety days.

 

    Section 50-23-290. Any person coming into possession of a watercraft or outboard motor without proper proof of ownership must apply to the department for a title using the form prescribed by the department. The application must be supported by an affidavit setting forth the circumstances under which the watercraft or outboard motor was acquired. The applicant must attempt to notify the last known titled or registered owner and any lienholder of record by certified mail of the application. The applicant must provide the department with proof of mailing.

    The applicant must publish an advertisement in a newspaper of general circulation in the county of residence of the last known owner of record for three successive issues. If there is no prior owner of record, the advertisement must be published in the county where acquired. The advertisement must be as prescribed by the department in the application. Proof of advertising must be submitted to the department.

    Thirty days after the date of the last advertisement if no claim of interest or ownership is made and the item has not been reported stolen, the department shall issue a clear title. If the item is reported stolen, the department shall dispose of the item according to law.

    If there is a claim of interest adverse to the applicant, the department shall not issue a title until the issue is resolved. The parties may apply to a court of competent jurisdiction for resolution.

 

    Section 50-23-295. (A) A certificate of title to watercraft or an outboard motor may not be transferred if the department has notice that property taxes for property tax years beginning after 1999, are owed on the watercraft or outboard motor. If transfer of title has been denied pursuant to this section, a tax receipt on the watercraft or outboard motor from the person officially charged with the collection of ad valorem taxes in the county where the taxes are due must be accepted as proof that the taxes have been paid. The bill of sale or title to watercraft or an outboard motor must require certification that property taxes that are due and payable for property tax years beginning after 1999, have been paid and are current as of the date of sale.

    (B) A person who knowingly sells a watercraft for which he owes unpaid and outstanding property taxes, or on which he knows there is a property tax lien, is guilty of a misdemeanor and, upon conviction, must be fined not more than one thousand dollars or imprisoned not more than thirty days. In addition to all applicable criminal penalties, a seller who falsely signs the certification required by subsection (A), that property taxes are current and paid on a watercraft transferred to the buyer, is liable to the buyer for three times the amount of damages directly associated with the false certification, as well as applicable costs and reasonable attorney's fees.

    (C) The county treasurer or other appropriate official annually, or more frequently as the county considers appropriate, shall transmit a list of delinquent taxes due on watercraft and outboard motors to the department. The list may be transmitted in any electronic format considered acceptable by the department.

 

SECTION 2.  Section 50-23-345 of the S.C. Code is amended to read:

 

    Section 50-23-345. (A) A transferee shall utilize the temporary certificate of number on the department's application form as a temporary certificate of number to permit the use of watercraft while applications for certificates of number are processed. Temporary certificates of number apply to new and previously owned watercraft. A temporary certificate is valid for not more than sixty days from the date of purchase. No temporary certificate of number may be issued for a boat, boat motor, or watercraft until the ad valorem tax is paid for the year for which the registration is to be issued.

    (B) When using a recently purchased watercraft under authority of a temporary certificate of number, the operator shall carry a copy of the bill of sale on board along with the temporary certificate of number.

    (C) A temporary certificate of number must not be issued for a watercraft not having a hull or manufacturer's identification number.

    (D) Duplicate or updated temporary certificates of number or updated bills of sale are prohibited.

    (E) The number assigned to a temporary certificate of number must not be displayed on the watercraft.

    (F) A transferee may operate a newly acquired outboard motor for sixty days while application for title is pending provided the bill of sale is in possession while operating the motor.

 

SECTION 3.  Section 50-23-375 of the S.C. Code is amended to read:

 

    Section 50-23-375. It is unlawful to display a registration number or a validation decal or an outboard motor title decal or sailboat title decal on any watercraft or outboard motor except on the watercraft or outboard motor for which it was issued.

 

SECTION 4.  Section 12-37-3210(A) of the S.C. Code is amended to read:

 

    (A) The auditor shall prepare a tax notice for all boats, boat motors, and watercraft owned by the same person and titled at the same time for each tax year. A notice must describe the boats, boat motors, or watercraft by name, model, and identification number. The notice must set forth the assessed value of the boat, the millage, the taxes due on each boat, and the tax year. The notice must be delivered to the county treasurer or official charged with the collection of taxes, who must collect or receive payment of the taxes. One copy of the notice must be in the form of a bill or statement for the taxes due on the boat and, when practical, the auditor shall mail that copy to the owner of the boat. When the tax and all other charges included on the tax bill have been paid, the county treasurer or official charged with the collections of taxes shall issue the taxpayer a paid receipt once all charges on the tax bill including the taxes have been paid. The receipt or a copy may be delivered by the taxpayer to the Department of Natural Resources with either the application for and issuance of number and certificate referenced in Section 50-23-340 or the renewal application for a certificate of number referenced in Section 50-23-370. A record of the payment of the tax must be retained by the treasurer. The auditor shall maintain a separate duplicate for boats, boat motors, and watercraft. No certificate of number may be issued by the Department of Natural Resources unless the application is accompanied by the receipt, or notice from the county treasurer, by other means satisfactory to the Department of Natural Resources, of payment of the tax.

 

SECTION 5.  Chapter 23, Title 50 of the S.C. Code is amended by adding:

 

Article 5

 

Registering of Watercraft and Outboard Motors

 

    Section 50-23-510. Any watercraft or outboard motor, or both, held or principally used in this State must be registered with the department. An owner of a watercraft or outboard motor registered in this State must notify the department within thirty days if ownership is transferred to another person, entity, or transferred out of state or otherwise disposed. Watercraft documented by the United States Coast Guard or its predecessor or successor agency and water skis, aquaplanes, surfboards, windsurfers, and similar devices, and those watercraft propelled exclusively by human power are not required to be registered.

 

    Section 50-23-520. (A) Every person who acquires a watercraft or outboard motor required to be registered under this article shall register the watercraft or outboard motor with the department within thirty days of the date of acquisition. The registration must be completed on forms required by the department. The fee for registration is ten dollars. The registration must be signed by the person who acquires the watercraft or outboard motor and shall contain:

       (1) the applicant's name, domiciled address including the county, date of birth, and the county where the watercraft is principally located, state issued identification number, and state of issue;

       (2) for watercraft, a description of the watercraft, including its make, model, model year, length, the principal material used in construction, hull number, and the manufacturer's engine serial number if an inboard; for an outboard motor, its make, model, or year of manufacture, and horsepower, and manufacturer's serial number;

       (3) the date of acquisition by the applicant, the name and address of the person from whom the watercraft or outboard motor was acquired, and the names and addresses of persons having a security interest in the order of their priority for the watercraft;

       (4) a bill of sale; and

       (5) further information reasonably required by the department to enable it to determine whether the owner is entitled to a certificate of title and the existence or nonexistence of security interests in the watercraft.

    (B) Every dealer selling or exchanging a watercraft or outboard motor subject to registration under this article shall complete the registration in the name of the purchaser at the time of delivery of the watercraft or outboard motor to the purchaser. The registration shall contain the name and address of a lienholder and the date of the security agreement. It must be signed by the dealer showing the assigned dealer permit number, as well as by the owner, and the dealer shall submit the application to the department within thirty days of the sale. However, permitted marine dealers are not required to obtain registrations for new or used vessels and outboard motors held in their inventory for sale until they are sold or exchanged as long as a proper manufacturer's or importer's statement of origin or title is held by the dealer. The fees for registration may not exceed those required by this article and if requested must be itemized on the bill of sale to the new owner. This does not prohibit a dealer from charging an administrative fee for registration.

    (C) If a dealer buys or acquires a used watercraft or outboard motor for resale and the watercraft or outboard motor is already covered by a registration the watercraft or outboard motor, the dealer need not send the registration until the watercraft or outboard motor is transferred.

    (D) A registration, except those from permitted marine dealers, submitted after thirty days is subject to a late penalty of fifteen dollars. A registration submitted after sixty days is subject to a late penalty of thirty dollars.

    (E) The provisions of this section requiring a fee do not apply to the watercraft and outboard motors owned by volunteer rescue squads used exclusively for the purpose of the squads.

 

    Section 50-23-530. (A) The department shall file each registration which is received by it, provided it is accompanied by the required fee and complies in all other respects with this article.

    (B) The department shall maintain a record of all registrations:

       (1) under a distinctive number assigned to each watercraft and outboard motor;

       (2) under the identification number awarded to a watercraft in accordance with the registration and numbering act of the state in which it is registered. If the State requires outboard motors to be registered separately, the department shall keep the motor registration numbers in its titling records;

       (3) alphabetically, under the name of the owner; and

       (4) in the discretion of the department, in any other method it determines.

    (C) All records of the department relating to the registration of watercraft or outboard motors are public records.

    (D) Each registration shall contain:

       (1) the date issued;

       (2) the name and address of the owner;

       (3) the names and addresses of any lienholders;

       (4) the title number assigned to the watercraft;

       (5) a description of the watercraft or outboard motor including its make, model, or year of manufacture, horsepower, registration number, and manufacturer's serial number or, hull number assigned to the watercraft by the department, length, and the principal material used in construction; and

       (6) any other data the department prescribes.

 

    Section 50-23-540. (A) The department shall notify the county in which the owner of the watercraft or outboard motor resides when the watercraft or outboard motor is transferred.

    (B) The county auditor shall specify the serial numbers of each watercraft or outboard motor upon which a tax bill is issued.

 

SECTION 6.  This act takes effect on July 1, 2027, and first applies to property tax years beginning thereafter.

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