IADA On The Front-Line Fighting For Dealer Rights

Legislation Passed

• SB 1896 – Illinois franchised dealers will be able to conduct sales activities and to use e-signatures on the internet. In addition, it will codify the practice of delivering vehicles to a customer’s residence. SB 1896 is the first step to obtaining electronic liens and vehicle titles for the industry, which will make it easier to conduct vehicle sales.

Legislation Defeated

• HB 2934 – Manufacturers’ attempt to REPEAL the Warranty Reimbursement Law for Time, Labor & Parts.
• HB 1514 – A shift in where tax receipts for vehicle sales are to be distributed to the municipality where the vehicle is titled rather than the dealership location.
• HB 1634 – Adopting California Emissions Standards
• HB 2047 – Unlawful for dealers to offer a subscription service for any motor vehicle feature.
• SB 1365 – Creates the Right to Know Act.
• Several bills regarding Autonomous Vehicles
• Numerous disclosures for dealers regarding automation driving features and many other legislative proposals.

• HB 3940 –DEALER COMPENSATION FOR WARRANTY WORK
  HB 3940 amends the Illinois Motor Vehicle Franchise Act to require vehicle manufacturers to compensate franchised dealers fairly and adequately for warranty work on vehicles. Also, adjust manufacturer calculations for time allowances, labor rates, and parts prices for warranty work.This legislation requires manufacturers to pay dealers no less than the amount that retail customers pay for the same repairs. In addition, it requires manufacturers for warranty work to reimburse dealerships for any parts necessary to complete the repair at the prevailing retail price charged by the dealership when sold to retail customers.Another important component of HB 3940 prevents manufacturers from imposing any type of cost recovery or surcharge against a dealership for payment made under the new provisions of this Act.  HB 3940 became law on January 1, 2023.
• SB 58 – RESTORES SALES TAX CREDIT ON TRADE-IN VEHICLES
  This legislation restores the full sales tax trade-in credit on vehicle trade-ins.  Two years ago, lawmakers capped the sales tax trade-in credit at $10,000 to fund capital infrastructure projects that were needed statewide.This year, IADA was successful in restoring the full sales tax trade-in credit and replacing those revenues received with an increase in the private vehicle sales tax.  SB 58 was signed into law and was effective January 1, 2022.
• SB 573 – 90 DAY DRIVE AWAY PERMIT/ $20 DEALER TITLE
  IADA was able to make a couple of changes to the Illinois Vehicle Code.  The first change was to extend the current 30-day drive away permit to be used for 90 days. This should assist dealers and consumers in titling and registering vehicles, especially for out-of-state customers.SB 573 also allows dealers to pay $20 for a dealer title when the assignment areas are full, saves dealers from paying the full price on titles.  SB 573 was signed into law and was effective January 1, 2022.

• SB 3609 – IADA LEGISLATION TO REDUCE SOS TITLE PROCESSING LATE FEES
  Our IADA sponsored SB 3609 has passed out of the General Assembly and was signed into law by the Governor.  Passage of this legislation provides an extra 15 days to submit title applications before SOS late fees kick in and reduces the fine amounts for late title applications.

Under current statute, if a title application is received by the SOS office after 30 days from the date of sale, late fees begin to be imposed on dealerships and the penalty amount increases incrementally based on when the title is received by their office.

Passage of SB 3609 extends the initial timeline for delinquent vehicle fees from 30 days to 45 days. This legislation will also establish the following reduced fee schedule based on when titles are received by the SOS office.  The law becomes effective January 1, 2023.

Legislation Defeated:

• Capping the doc fee at $150.00.  Over 50% reduction from current doc fee
• Creates the Paid Family Leave Act
• Increasing minimum wage to $20 an hour
• Blocking consumer privacy bills.  Adds extra layers of work/disclosures for dealerships
• Creates the Fair Workweek Act – provides for guaranteed work schedules/rest periods
• Creates the Healthy Workplace Act – provides specified number of paid sick days to employees
• Elimination of Retailer’s Discount

HB 3940 – Amends the Illinois Motor Vehicle Franchise Act

• Requires vehicle manufacturers to compensate franchised dealers fairly and adequately for warranty work on vehicles.Adjusts manufacturer calculations for time allowances, labor rates, and parts prices for warranty work.
• Extends warranty reimbursement provisions to recall repairs.

HB 2435 – Amends the Illinois Motor Vehicle Franchise Act

• Prohibits a manufacturer from prohibiting or requiring a dealer to offer a specific secondary product, including service contracts; maintenance agreements; extended warranties; protection product guarantees; gap waivers; insurance; replacement parts; vehicle accessories; oil; or supplies.Permits a manufacturer to offer an incentive program to encourage dealers to offer manufacturer-approved or endorsed secondary products.
• Prevents manufacturers from dictating to dealers to use only their products and extended service contracts.

• SB690
  Beginning January 1, 2020, IADA was successful in raising the base Doc fee to $300 per vehicle ($150 increase).
• SB22 – Amends the Illinois Vehicle Code.
  IADA defeated Senator Oberweis’ attempt to repeal the Sunday closing law.

• SB2420 – Amends the Illinois Vehicle Code.
  IADA defeated Senator Oberweis’ attempt to repeal the Sunday closing law.

SB1687 – Amends the Motor Vehicle Franchise Act.

• Limits the ability of a manufacturer to penalize a dealer if a customer resells or exports a vehicle.
• Prohibits a manufacturer from requiring dealer improvements more than once every 10 years, unless the manufacturer pays for the improvements.
• Prohibits a manufacturer from requiring that dealers use specific vendors for improvements, unless the manufacturer pays for the increased expense of its vendor over the dealer’s.
• Requires manufacturers to reimburse proposed buyers and sellers if the manufacturer exercises a right of first refusal to block a dealership transfer.
• Includes a legislative finding that the regulation of motor vehicle manufacturers creates a system for servicing vehicles and complying with warranties.

SB2037 – Amends the Illinois Vehicle Code.

• IADA defeated Senator Oberweis’ attempt to repeal the Sunday closing law.

SB2860 – Amends the Illinois Vehicle Code.

• IADA defeated Senator Oberweis’ attempt to repeal the Sunday closing law.

SB1707, SB1780, and SB 1835 – Amends the Illinois Vehicle Code.

• IADA defeated Senator Oberweis’ attempt to repeal the Sunday closing law.

HB2317 – Amends the Retailers Occupation Tax Act.

• Reduced the sales tax basis for motor vehicle leases from the entire value of the leased vehicle to the amount of the lease contract.

SB1417 – Amends the Motor Vehicle Franchise Act

• Added Right of First Refusal for dealerships
• Provides language to allow dualling of unrelated franchises at one location
• Termination safeguards
• Sale of Factory pre-owned vehicles
• Includes truck engines, transmissions, and rear axles in the definition of motor vehicles
• Defines dealer audit periods for incentive audits and warranty audits at 12 months

HB4628 – Amends Motor Vehicle Franchise Act

• Provides that a manufacturer that goes through bankruptcy cannot backfill a terminated franchise without offering the point to the terminated dealer unless (i) as a result of a former franchisee’s cancellation, termination, non-continuance, or nonrenewal of the franchise, the bankrupted manufacturer had consolidated the line make with another of its line makes with a franchisee who operates a facility located within that relevant market area; (ii) the successor manufacturer paid the former franchisee the fair market value of the former franchisee’s franchise; or (iii) the successor manufacturer proves that the former franchisee is unfit to own or manage the dealership.
• Prohibits manufacturers from forcing dealers into a Site-Control Agreement

SB1417 – Amends the Motor Vehicle Franchise Act

• Added Right of First Refusal for dealerships
• Provides language to allow dualling of unrelated franchises at one location
• Termination safeguards
• Sale of Factory pre-owned vehicles
• Includes truck engines, transmissions, and rear axles in the definition of motor vehicles
• Defines dealer audit periods for incentive audits and warranty audits at 12 months

HB4628 – Amends Motor Vehicle Franchise Act

• Provides that a manufacturer that goes through bankruptcy cannot backfill a terminated franchise without offering the point to the terminated dealer unless (i) as a result of a former franchisee’s cancellation, termination, non-continuance, or nonrenewal of the franchise, the bankrupted manufacturer had consolidated the line make with another of its line makes with a franchisee who operates a facility located within that relevant market area; (ii) the successor manufacturer paid the former franchisee the fair market value of the former franchisee’s franchise; or (iii) the successor manufacturer proves that the former franchisee is unfit to own or manage the dealership.
• Prohibits manufacturers from forcing dealers into a Site-Control Agreement

HB 1657

• Beginning January 1, 2008, IADA was successful in raising the Doc fee level to $150 per vehicle ($100 increase).

HB 2960

• Expands the Illinois Motor Vehicle Review Board from a 3-member panel to a full 7-member Board. The Board has benefited dealers by streamlining the dispute resolution process.

HB 3037

• Illinois Motor Vehicle Franchise Act changes to strengthen existing statutes regarding dealer relocations.

HB 3420

• Electronic Title and Lien Processing.

HB 520

• Makes numerous Motor Vehicle Franchise Act changes.

HB 555

• Prohibits manufacturers from owning or operating dealerships.

SB 539

• Passed legislation to rewrite the Illinois Motor Vehicle Franchise Act. Incorporates a 3-member board to hear relocation and other franchise issues.

HB 3522

• Passed legislation to require a mandatory damage disclosure of new vehicles. Must disclose damage which exceeds 6% of the retail price.

SB 1730

• Legislation was passed which prohibits out of state dealers from displaying or selling vehicles in Illinois.

HB 1587

• Prohibits out-of-state dealers from selling in Illinois.

HB 3246

• Allows dealer to relocate within two miles of an existing franchise.
• Limits audits and chargebacks to 18 months.
• All claims must be approved or disapproved by the manufacturer.

SB 393

• Prevents dealers and rental agencies from going outside their relevant market area to conduct an off-site sale. All vehicle sales made as a result of vehicle referral programs to be consummated only by a licensed dealer.

SB 1273

• Eliminates Ford’s or any manufacturers attempt to establish separate facilities to sell program vehicles. Allows dealers to charge up to $40 for DOC fees, and provides for an annual increase.

HB 776

• An agreement was reached with GM to put a national moratorium on the Delco-Tech Service Center Program.