SB1227

Regular Session

Relating to fees for the issuance of certain military specialty license plates.

LowStandard timeline

Low Cost

Effective:2025-09-01

Enforcing Agencies

Texas Department of Motor Vehicles (TxDMV) • County Tax Assessor-Collectors

Compliance Analysis

Key implementation requirements and action items for compliance with this legislation

Implementation Timeline

Effective Date: September 1, 2025
Compliance Deadline: September 1, 2025 (Systems must be updated prior to start-of-business).
Agency Rulemaking: TxDMV is not expected to issue complex rules, but must update the Registration and Title System (RTS). Watch for a "Dealer Letter" or "Registration and Title Bulletin" in August 2025 confirming the RTS code update.

Immediate Action Plan

1. IT/DMS Update: Schedule a review of fee codes in your DMS. Flag Pearl Harbor and Purple Heart codes to auto-populate $0.00 effective 9/1/2025.
2. Accounting Review: Instruct Accounts Payable to reject check requests to Tax Assessor-Collectors that include this $3.00 fee for transactions dated post-implementation.
3. Vendor Verification: Send a notice to your title service providers requiring written confirmation that they have adjusted their billing logic.
4. Compliance Memo: Distribute a "Stop-Bill" notice to F&I and Title departments one week prior to the effective date.

Operational Changes Required

Contracts

Buyer’s Orders: Standard forms remain valid. However, the line-item input for "License/Registration Fees" must reflect the reduction.
Third-Party Vendor Agreements: If you utilize a private title service or "runner," you must verify their fee schedule is updated. If they bill you the obsolete $3.00 fee and you pass it to the consumer, your dealership is liable for the over-collection.

Hiring/Training

Title Clerk Directives: Issue a memo to title clerks and F&I managers clarifying that while the *registration* fee was already waived for these plates, the *issuance* fee is now also $0.00.
Scope limitation: Explicitly train staff that this fee elimination applies only to Pearl Harbor (Sec. 504.315(d)) and Purple Heart (Sec. 504.315(g)) plates. It does not apply universally to all military specialty plates.

Reporting & Record-Keeping

Audit Trails: Ensure transaction ledgers for affected deals show a $0.00 collection for the specialty plate fee.
Refund Protocol: Establish a mandatory refund process. If the $3.00 is inadvertently collected post-effective date, it must be refunded to the customer immediately. Retain proof of refund to satisfy potential OCCC (Office of Consumer Credit Commissioner) audits.

Fees & Costs

Fee Elimination: The $3.00 issuance fee is removed.
Cost Impact: Neutral to the business; savings passed to the consumer.

Strategic Ambiguities & Considerations

TxDMV System Lag: There is a risk that the state's Registration and Title System (RTS) may not be updated by the County Tax Assessor-Collector on exactly September 1.
*Risk:* The County may demand the $3.00 fee to process the title because their screen still shows it as due.
*Strategy:* If this occurs, pay the fee to avoid delaying the customer's registration, but document the discrepancy and seek a refund from the County later. Do not charge the customer the fee if the transaction date is on or after 9/1/2025.

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Legislative Timeline

This bill's path through the Texas Legislature

TopicsMilitary & Veterans Vehicles & Traffic Vehicles & Traffic--vehicle Registration License Plates Fees & Other Nontax Revenue Fees & Other Nontax Revenue--state

Official Analysis

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BILL ANALYSIS

Senate Research Center	S.B. 1227
89R11553 CXP-D	By: Flores
	Transportation
	3/20/2025
	As Filed

AUTHOR'S / SPONSOR'S STATEMENT OF INTENT

Veterans and active military personnel have the ability to apply for specialized license plates under Sections 504.3015(a) and (b) of the Transportation Code. The application process currently requires an additional $3 fee on license plates for Pearl Harbor survivors and Purple Heart recipients. S.B. 1227 would eliminate this "special fee" in order to put the fee schedule on parity with other military merit plates and clean up the language in the section.

As proposed, S.B. 1227 amends current law relating to fees for the issuance of certain military specialty license plates.

RULEMAKING AUTHORITY

This bill does not expressly grant any additional rulemaking authority to a state officer, institution, or agency.

SECTION BY SECTION ANALYSIS

SECTION 1. Amends Sections 504.3015(a) and (b), Transportation Code, as follows:

(a) Requires a person applying for a set of license plates under Subchapter D (Specialty License Plates for the Military), Chapter 504 (License Plates), to pay the registration fee required under Chapter 502 (Registration of Vehicles), rather than the fee required under Chapter 502 and the applicable special plate fee required under Section 504.301 (Provisions Generally Applicable to Military Specialty License Plates), except that one set of license plates is required to be issued without the payment of the registration fee under certain provisions.

(b) Provides that, except as otherwise provided by this subchapter, there is no additional fee for a specialty license plate issued under this subchapter, rather than under another provision of this subchapter. Deletes existing text providing that the fee for the issuance of one set of specialty license plates issued under Section 504.315(d) (relating to specialty plates for recipients of certain military awards) or (g) (relating to specialty plates for recipients of the Purple Heart) is $3.

SECTION 2. Effective date: September 1, 2025.

Senate Authors

Sen. Peter FloresRepublican · Primary Author

Coauthors (2)

House Sponsor

Rep. Ray LopezDemocrat · Primary Sponsor

Bill Text(with markup)

S.B. No. 1227

View bill text in multiple formats on Texas Legislature website

Fiscal NoteView Original

	AN ACT
	relating to fees for the issuance of certain military specialty
	license plates.
	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
	SECTION 1. Sections 504.3015(a) and (b), Transportation
	Code, are amended to read as follows:
	(a) A person applying for a set of license plates under this
	subchapter shall pay the registration fee required under Chapter
	502 [~~and the applicable special plate fee required under this~~
	~~section~~], except that one set of license plates shall be issued
	without the payment of the registration fee under:
	(1) Section 504.308;
	(2) Section 504.310(b);
	(3) Section 504.315, other than Subsections (c) and
	(q) of that section; and
	(4) Section 504.319.
	(b) Except as otherwise provided by this subchapter, there
	[~~The fee for the issuance of one set of specialty license plates~~
	~~issued under Section 504.315(d) or (g) is $3. There~~] is no
	additional fee for a specialty license plate issued under [~~another~~
	~~provision of~~] this subchapter.
	SECTION 2. This Act takes effect September 1, 2025.

LEGISLATIVE BUDGET BOARD
Austin, Texas

FISCAL NOTE, 89TH LEGISLATIVE REGULAR SESSION


March 25, 2025

TO:	Honorable Robert Nichols, Chair, Senate Committee on Transportation

FROM:	Jerry McGinty, Director, Legislative Budget Board

IN RE:	SB1227 by Flores (Relating to fees for the issuance of certain military specialty license plates.), As Introduced

No significant fiscal implication to the State is anticipated.

It is assumed that any revenue implications associated with the bill would be insignificant.

Local Government Impact

No fiscal implication to units of local government is anticipated.

Source Agencies:

304 Comptroller of Public Accounts, 608 Department of Motor Vehicles

LBB Staff:

JMc, AAL, TG

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Frequently Asked Questions

Common questions about SB1227

What does Texas SB1227 do?

SB1227 eliminates the $3. 00 issuance fee for Pearl Harbor Survivor and Purple Heart Recipient license plates. While fiscally minor, this change creates a strict liability compliance issue for automotive dealerships and title service companies: you must update Dealer Management Systems (DMS) to stop collecting this fee by September 1, 2025, to avoid violations of the Deceptive Trade Practices Act (DTPA) and potential audit findings regarding fee over-collection.

Who authored SB1227?

SB1227 was authored by Texas Senator Peter Flores during the Regular Session.

When was SB1227 signed into law?

SB1227 was signed into law by Governor Greg Abbott on May 29, 2025.

Which agencies enforce SB1227?

SB1227 is enforced by Texas Department of Motor Vehicles (TxDMV) and County Tax Assessor-Collectors.

How urgent is compliance with SB1227?

The compliance urgency for SB1227 is rated as "low". Businesses and organizations should review the requirements and timeline to ensure timely compliance.

What is the cost impact of SB1227?

The cost impact of SB1227 is estimated as "low". This may vary based on industry and implementation requirements.

What topics does SB1227 address?

SB1227 addresses topics including military & veterans, vehicles & traffic, vehicles & traffic--vehicle registration, license plates and fees & other nontax revenue.

Legislative data provided by LegiScanLast updated: November 25, 2025

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