California Governor Vetoed Lien-Sale Proceed Legislation
Owners of vehicles sold at lien auctions must continue using current DMV processes to track potential excess proceeds.
Updated on Oct. 8, 2026 in Auto Parts
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Governor Gavin Newsom vetoed SB 1029, a bill that would have changed how unclaimed proceeds from vehicle lien sales are managed in California. The state Department of Motor Vehicles will continue to hold funds collected from auctions when debts are paid but sale prices exceed storage and towing costs.
Why it matters
The veto keeps the existing system in place, meaning there is no new requirement for the state to notify owners about leftover money. Governor Newsom cited concerns regarding the administrative burden on the Motor Vehicle Account and the lack of clarity on ownership verification.
Between 2016 and 2024, the DMV collected over $8 million in excess proceeds from 5,300 vehicle sales. Under current law, owners have three years to claim these funds before they remain permanently with the department.
The players
Gavin Newsom
The Governor of California who vetoed SB 1029 due to concerns over administrative costs and ownership verification responsibilities.
California Department of Motor Vehicles
The state agency responsible for managing vehicle registrations and currently overseeing the collection of surplus funds from lien-sale auctions.
The details
Excess proceeds occur when a lien sale yields more money than is required to cover the towing and storage debts associated with the vehicle. The DMV currently maintains an online lookup tool for these funds, but the agency is not required to contact former owners directly. SB 1029 sought to shift management of these unclaimed funds to the state Controller, a move stopped by the veto.
Timeline
From 2016 to 2024, the DMV collected $8 million in excess proceeds.
Governor Gavin Newsom vetoed the legislation on October 8, 2026.
The Home Front
The veto of SB 1029 maintains the status quo for California's vehicle lien-sale regulations, rejecting a proposed shift in oversight to the state Controller. This decision preserves the current DMV-managed system for surplus proceeds, which currently lacks a mandatory notification mandate for owners.
If you recently had a vehicle sold through a lien auction, check the California DMV online lookup tool to see if excess proceeds are available. You have a three-year window from the date of the sale to submit a claim for any leftover funds.
The takeaway
Because the state is not required to notify you of excess proceeds, it is up to you to monitor your records if you have had a vehicle lien sale. Utilize the official DMV online lookup tool periodically if you suspect funds remain unclaimed.
Further reading
Find more resources for vehicle owners at the Auto Parts section of our site.
Source note: This article includes information reported by Carscoops.
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Should government agencies be required to proactively notify citizens of unclaimed funds they hold?
