SB 707 Modifies provisions relating to vehicle sales
Sponsor: Schatz
LR Number: 5008S.09T Fiscal Notes
Committee: Transportation, Infrastructure and Public Safety
Last Action: 7/5/2018 - Signed by Governor Journal Page: S2508
Title: CCS HCS SS SCS SB 707 Calendar Position:
Effective Date: August 28, 2018
House Handler: Engler

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Current Bill Summary


CCS/HCS/SS/SCS/SB 707 - This act modifies provisions relating to vehicle sales.

The act increases, from $25,000 to $50,000, the bond required for licensure as a motor vehicle dealer.

This act also requires motor vehicle dealer license applicants to submit their regular business hours, and a phone number and email address where the applicant can be contacted during regular business hours. Applicants shall maintain a working telephone number during the entire registration year which will allow the public, the Department of Revenue, and law enforcement to contact the applicant during regular business hours, and shall maintain an email address that may be used for official correspondence with the department.

The act increases, from 6 to 8, the number of vehicle sales required as evidence a person is engaged in the motor vehicle business and eligible for licensure or renewal.

Upon the sale of a currently licensed motor vehicle dealership, if the new owner does not wish to retain the selling dealer's license number, the Department shall issue to the new owner a new dealer's license number and an equal number of plates or certificates as the selling dealer had been issued.

Currently, motor vehicle dealers shall receive one dealer license plate upon application for a dealer's license, and may be issued two additional plates. Thereafter, dealers may be issued an additional plate for each 10 additional vehicles sold. This act specifies that motor vehicle dealers shall receive one plate and may receive a second upon application for a license, and may obtain additional plates beginning at 15 vehicle sales.

This act modifies the classifications of vehicle dealers to which the Department of Revenue shall assign certain distinctive dealer license numbers.

The act specifies that motor vehicle dealer licenses may, rather than shall, be suspended or revoked following a hearing on allegations of certain violations of the dealer licensure law.

This act modifies the law with regard to off-premise vehicle shows and sales. The act leaves in place existing requirements that the vehicles sold be used and titled solely in the seller's ordinary course of business, and that the sales be held in conjunction with a credit union or other financial institution. Motor vehicle dealers may participate in up to two motor vehicle sales or shows annually and conduct sales away from the dealer's registered place of business, which for purposes of this section shall be considered "off-premise events" under certain circumstances. Such events shall be conducted for not more than 5 consecutive days, the event shall not require an unreasonably prohibitive participation fee, a majority of the dealers within a class located within a certain distance of the event participate or are notified at least 45 days in advance and have the opportunity to participate, and the organizer of the event provides a copy of the notice to the Director of the Department of Revenue. No dealer shall participate in an off-premise event more than 10 miles from its licensed location. Recreational vehicle dealers may participate even if a majority of recreational vehicle dealers in the city or town do not.

These provisions are similar to SCS/HB 2122 (2018), and to provisions in SB 492 (2017), HCS/SCS/SB 399 (2017), and HB 1034 (2017).

Currently, to transfer most vehicles' registration to a new owner, the vehicle must undergo a safety inspection not more than 60 days prior to the date of the application for vehicle registration. Under the act, if a vehicle is purchased from a motor vehicle dealer and a valid inspection has been made within 60 days of the purchase date, the new owner may utilize an inspection performed within 90 days prior to the application for registration or transfer.

This provision is identical to provisions in the House perfected HB 2122 (2018), CCS/HCS/SS/SB 881 (2018), and to HB 2487 (2018).

ERIC VANDER WEERD