HOUSE BILL REPORT

SSB 5509

This analysis was prepared by non-partisan legislative staff for the use of legislative members in their deliberations. This analysis is not a part of the legislation nor does it constitute a statement of legislative intent.

Brief History:

Committee Activity:

Transportation: 3/19/09, 3/23/09 [DP].

Brief Summary of Substitute Bill

Allows rental car companies to include separately stated surcharges or fees in their rental agreements.
Requires a rental car company that includes a separate vehicle license cost recovery fee in a transaction to insure that the fee is a good faith estimate of the average daily charge to recover the total annual titling, registration, plating, and inspection costs for the vehicle.
Requires the rental car company to adjust the vehicle cost recovery fee for the following calendar year by the corresponding amount if the vehicle cost recovery fee is found to exceed the actual costs.

Majority Report: Do pass. Signed by 26 members: Representatives Clibborn, Chair; Liias, Vice Chair; Roach, Ranking Minority Member; Rodne, Assistant Ranking Minority Member; Armstrong, Campbell, Cox, Driscoll, Eddy, Finn, Flannigan, Herrera, Johnson, Klippert, Kristiansen, Moeller, Rolfes, Sells, Shea, Simpson, Springer, Takko, Upthegrove, Wallace, Williams and Wood.

Background:

Rental car businesses are required to register with the Department of Licensing (DOL), and renew this registration annually. Rental cars must be titled and registered with the DOL, and identified at the time of registration with the rental car business number issued by the DOL. The DOL is empowered to conduct audits, investigations, and enforcement actions in relation to the statutory requirements for rental car businesses.

Rental car businesses are not required, nor are they prevented from, separately identifying fees or surcharges that are imposed in addition to the rental rate and applicable rental car taxes.

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Summary of Bill:

Rental car companies may include separately stated surcharges or fees in their rental agreements. If a rental car company includes a separate vehicle license cost recovery fee in a transaction, the fee must represent the company's good faith estimate of the average daily charge to recover the total annual titling, registration, plating, and inspection costs for the vehicle.

If the vehicle cost recovery fee imposed is found to exceed the actual costs for that calendar year, the rental car company can retain that amount but must adjust the vehicle cost recovery fee for the following calendar year by the corresponding amount.

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Appropriation: None.

Staff Summary of Public Testimony:

(In support) This is a technical bill that would allow rental car companies to do in Washington what they already do in many other states. The Oregon Legislature is currently considering a similar bill. Currently, car rental companies are able to set their own rates and include any costs in that rate. The law is silent on the issue of separately-listed charges on rental bills for fees and this bill would make the listing of those charges permissive. The industry standard is to turn over the rental car fleet every nine months and to associate the costs of licensing a vehicle with the vehicle. Consumers should be able to see the fees that they are charged and this would be the case on both the rental bill and online in a quote.

(Opposed) None.