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California’s Senate just gave the green light to a bill that could make buying a car more expensive.

Senate Bill 791 would let car dealers raise their document processing fees (also coined “junk fees” by buyers) from $85 to as much as $500 per sale. The bill passed with strong bipartisan support and now heads to the Assembly.

Supporters say the increase makes sense

Car dealers handle a growing pile of paperwork every time someone buys a car. That includes loan documents, DMV registration, and fraud prevention forms. Over the years, these tasks have become more complex and expensive to manage.

Dealerships argue that, unlike most businesses, they need permission from lawmakers to adjust these fees.

They see this bill as a way to keep up with rising costs and changing regulations.

Under the proposal, dealers could charge up to 1% of the car’s sale price, capped at $500

With the average new car now costing nearly $49,000, most buyers could see a fee of around $415. That’s on top of the vehicle price, and it applies to used cars, too.

Consumer advocates are not convinced. They say the fee hike puts more pressure on buyers at a time when affordability is already a problem in California. Some lawmakers and watchdogs see it as another “junk fee” that adds cost without adding value. There are also concerns that buyers won’t always realize what they’re being charged until it’s time to sign.

Politics are also in play

Since 2015, the California New Car Dealers Association has donated close to $3 million to state lawmakers. Several senators who voted for the bill received campaign contributions from the group, CalMatters shared.

The bill’s author, Senator Dave Cortese, acknowledged the optics but said the fee cap hasn’t changed in years and no longer reflects today’s business environment.

Senator Henry Stern was the only “no” vote. He raised concerns about rewarding an industry that has pushed back on consumer and environmental reforms.

A handful of senators didn’t vote at all. That’s not unusual in Sacramento, apparently, where silence can sometimes be a safer political move than taking a side…

Of note, government fleet purchases would be exempt from the increased car sale fee. The bill still needs approval from the Assembly and the governor before it becomes law.