HB256 Alabama 2011 Session

Updated Feb 27, 2026

Notable

Summary

Primary Sponsor: Ron Johnson
Republican
Session: Regular Session 2011
Title: Motor vehicles, dealer license plates, number and use limited, transit plates provided for, Sec. 40-12-264 am'd.
Summary: HB256 tightens Alabama's motor vehicle dealer license plate rules by limiting plate purchases, restricting use, adding transit plates, and increasing penalties for misuse.
What This Bill Does
It caps how many dealer plates different types of dealers can buy (25 for new, 10 for used, 10 for motorcycle; possibly 25 extra for high-volume title transfers). It removes wholesalers, rebuilders, and reconditioners from buying regular dealer plates and allows them to use dealer transit plates instead. It restricts dealer plate use to dealer-owned vehicles in the inventory and to certain people, sets 72-hour demonstration limits, adds rules for truck demonstrations, and creates transit plates for wholesale displays. It raises civil and criminal penalties for misuse, allows the licensing department to deny regulatory licenses for unpaid penalties, requires plates for vehicles withdrawn from inventory, and prohibits using plates to dodge taxes; the act takes effect October 1, 2011.

Who It Affects
Licensed new motor vehicle dealers, used motor vehicle dealers, and motorcycle dealers who must limit their dealer plates to the specified maximums and adhere to use restrictions, including 72-hour limits for prospective purchasers and allowable demonstration uses.
Wholesalers, rebuilders, reconditioners, and manufacturers, who are affected by losing the ability to buy regular dealer plates (they may instead buy dealer transit plates or, in some cases, obtain plates under separate provisions) and by new penalties and inventory rules.

Key Provisions
Cap on dealer plates: up to 25 for new dealers, up to 10 for used dealers, up to 10 for motorcycle dealers; up to 25 additional plates possible for 1,500+ title transfers in the previous year.
Wholesalers/rebuilders/reconditioners may not buy regular dealer plates; they may purchase up to 10 dealer transit plates for wholesale activities.
Dealer plates may be used only on dealer-owned vehicles in the dealership's inventory and by specified people (prospective purchasers, owners, partners, corporate officers, and employees) with defined demonstration and 72-hour limits; certain demo uses may occur without a fee.
Dealer transit plates: up to 10 plates to display, test, demonstrate, or transport vehicles within wholesale inventories; not for service vehicles; fees are the same as dealer plates.
Manufacturers may procure plates for transporting and testing new vehicles or manufactured homes; plates issued with the word 'manufacturer' visible.
Fees: no refunds; $1.75 issuance fee to be deposited into the county general fund for the issuing office; proceeds distributed like other plate fees and not prorated.
Penalties: higher civil penalties for misuse; criminal penalty for willful misstatements in plate purchases (Class A misdemeanor) and civil penalties up to $1,000 per occurrence; department may assess penalties and deny regulatory licenses for unpaid penalties.
Inventory rule: dealers must purchase plates for vehicles withdrawn from inventory; plates may be surrendered if license is forfeited or business ends.
Tax compliance: plates cannot be used to dodge registration or ad valorem taxes; penalties apply for misuse.
Effective date: October 1, 2011.

AI-generated summary using openai/gpt-5-nano on Feb 24, 2026. May contain errors — refer to the official bill text for accuracy.
Subjects: Motor Vehicles