HOUSE BILL REPORT

HB 2940

BYRepresentatives R. Meyers, S. Wilson and Zellinsky

Pertaining to vehicle dealer documentary service fees.

House Committe on Transportation

Majority Report:  The substitute bill be substituted therefor and the substitute bill do pass.  (18)

      Signed by Representatives R. Fisher, Chair; R. Meyers, Vice Chair, Western Washington; Wood, Assistant Ranking Republican Member; Bennett, Cantwell, Cooper, Day, G. Fisher, Forner, Heavey, Jones, Nelson, Prentice, D. Sommers, Todd, Walker, S. Wilson and Zellinsky.

House Staff:Louise Bray Sandison (786-7322)

AS REPORTED BY COMMITTEE ON TRANSPORTATION FEBRUARY 5, 1990

BACKGROUND:

Motor vehicle dealers perform a variety of services for their customers, including transferring title and licensing of the vehicle in addition to facilitating completion of financing arrangements.

Motor vehicle dealers are prohibited from charging a separate fee for these services.

SUMMARY:

SUBSTITUTE BILL:  Motor vehicle dealers are authorized to charge up to $25 per vehicle sale or lease for the following documentary services:  licensing, registration, title verification, title transfer, perfecting title, releasing or satisfying a lien or other security interest.  The documentary service fee, for purposes of the Retail Installment Sales Act, is not a service charge as defined in that act.

SUBSTITUTE BILL COMPARED TO ORIGINAL:  The substitute bill limits the services for which the fee may be charged and clarifies that only one fee may be charged per vehicle sale or lease.  Language clarifies that the documentary service fee, for purposes of the Retail Installment Sales Act, may be charged only by motor vehicle dealers.

Fiscal Note:      Not Requested.

House Committee ‑ Testified For:    Jim Boldt, Washington Auto Dealers Association.

House Committee - Testified Against:      Bruce Plotkin, Assistant Attorney General, by letter dated February 2, 1990.

House Committee - Testimony For:    Motor vehicle dealers must provide a variety of services for which they may not charge a fee.  This negotiable "after sale" fee will assist dealers in recovering the cost of providing these services.

House Committee - Testimony Against:      The legislation would permit dealers for the first time to itemize on sales documents a separate "documentary service fee" for their preparation or handling of licensing, registration, titling, and release of security interests.  Vehicle dealers, like other businesses, have always been able to recover these documentary costs in the same way as other overhead costs:  by charging more in negotiations for the overall price of the vehicle.