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Recalls spur Congress to act on auto safety; fees on new cars to fund NHTSA?

November 10, 2010

Two key members of Congress are drafting major reforms of auto safety laws in the wake of Toyota Motor Corp.’s massive recalls that could include a fee on new car sales to fund more federal oversight.

Sen. Jay Rockefeller (D-W.Va.), chairman of the Senate Commerce Committee, and Rep. Henry Waxman (D-Calif.), chairman of the House Energy and Commerce Committee, were expected in late April to release draft auto safety legislation that would require all automakers to install anti-runaway technology, such as brake override systems, stop-start technology and event data recorders.

Waxman and Rockefeller were aiming to draft one bill, but may end up writing separate legislative proposals.

Congressional aides briefed on the proposals said the authors were considering imposing a small fee on new-car sales that would fund an increase in the budget of the National Highway Traffic Safety Administration.

Waxman said the spate of recent recalls "underscore the need to ensure (NHTSA) has the resources, expertise and authority it needs to protect consumers from vehicle safety defects."

Sen. Amy Klobuchar (D-Minn.) notes that in 1980, NHTSA assigned 119 people to enforcement duties, twice the current number.

The bills also were expected to significantly increase fines for delaying auto safety recalls. The current maximum fine is $16.4 million, a sum Toyota agreed to in April for delaying by at least four months its recall of 2.3 million vehicles because the accelerator pedal on some of its vehicles could stick.

The lawmakers also may call for adding staff at the NHTSA and for finding ways to give the agency more authority to order recalls faster.

"Recent Toyota recalls reveal lapses in our auto safety monitoring system, and additional areas where we can do much better by the American consumer," Rockefeller said.

"Shortly, I will introduce legislation that will hold automakers to a higher standard and strengthen the NHTSA’s ability to more effectively protect Americans on the road."

David Strickland, the head of the NHTSA, has endorsed hiking maximum fines to more than $100 million.