HOUSE BILL REPORT

SHB 1221

As Amended by the Senate

BYHouse Committee on Commerce & Labor (originally sponsored by Representatives McLean, Vekich, Nealey, P. King, Todd and Silver)

Easing licensing requirements for vehicle auctioneers.

House Committe on Commerce & Labor

Majority Report:  The substitute bill be substituted therefor and the substitute bill do pass.  (11)

      Signed by Representatives Vekich, Chair; Cole, Vice Chair; Patrick, Ranking Republican Member, Jones, R. King, Leonard, O'Brien, Prentice, Smith, Walker and Wolfe.

House Staff:Joan Elgee (786-7166)

AS PASSED HOUSE MARCH 2, 1989

BACKGROUND:

Persons selling vehicles, including auctioneers, must obtain a vehicle dealer's license.  To obtain a dealer's license, an applicant must maintain an "established place of business," including an office in a commercial building, a display area, and a permanently affixed exterior sign.  A temporary subagency license is required to sell a vehicle at a location other than the principal place of business.  A vehicle dealer must also obtain a license for each classification of vehicle sold.  There are separate bonding requirements for each of these classifications.

SUMMARY:

Auction company is defined as a company licensed to conduct auctions, and which sells vehicles only at auction.

A place of business requirement is established for auction companies in lieu of the "established place of business" requirement for other vehicle dealers.  Auction companies shall maintain records and files necessary to do business, a telecommunication system, and office facilities within the state.

Auction companies are exempt from obtaining temporary subagency licenses to sell vehicles at locations other than the principal place of business.

An auction company may sell mobile homes and travel trailers, motor vehicles, or miscellaneous vehicles at auction under a motor vehicle dealer's license.

The bonding required for a motor vehicle dealer's license for auction companies is $15,000, which shall cover all vehicles sales in the state.

EFFECT OF SENATE AMENDMENTS:  A definition of "auction" is added.  The exemption from the "established place of business" requirement for other vehicle dealers only applies to auction companies that do not own vehicle inventory or sell vehicles from an auction yard.  Auction companies must post their vehicle dealer license at each vehicle auction and provide the department with the address of the auction at least three days before the auction.  Technical and clarifying changes are made.

Fiscal Note:      Requested January 30, 1989.

House Committee ‑ Testified For:    Representative Alex McLean, Prime Sponsor; Joe Daniels, Washington Auctioneers Association;  Errold Sutter, V.P. Washington Auctioneers Association;  Keith Harris, Auctioneer; Duane Love, Evergreen Auction Company; and Heather Hamilton, Department of Licensing.

House Committee - Testified Against:      None Presented.

House Committee - Testimony For:    Vehicle dealer licensing requirements place a hardship on auction companies.  Auction companies are unique in that most of their business takes place off-site, requiring multiple temporary subagency licenses.  Further, obtaining a different vehicle dealer's license for each classification of vehicle sold is unnecessary when most vehicles are sold on an occasional basis. Some smaller auction companies are put at a competitive disadvantage because they are unable to meet the requirements for a vehicle dealer's license and they are unable to afford the multiple licenses.

House Committee - Testimony Against:      None Presented.

VOTE ON FINAL PASSAGE:

      Yeas 95; Excused 3

Excused:    Representatives Bristow, Schoon and Todd