New Dealer Groups Plan Legislative Pushes in ’07

Some of the new state powersports dealer associations formed in 2006 head into the new year with aggressive legislative goals.
At least four such associations started this year, in Nevada, Georgia, Arizona and Oklahoma. The National Council of Motorcycle Dealers Association, which aids state groups, has previously stated it is working with 15 state dealer associations.
Here’s a look at what three of those new state associations have been working on in 2006 as well as their membership growth.
While the membership growth has been slower than association management would like, there’s no lack of issues for the Nevada Powersports Dealers Association to tackle.
Susan Fisher, the association’s executive director, outlined two key issues the association is handling: reviving consumers’ ability to use revolving credit and introducing state legislation to require registration and titling of off-road vehicles.
The latter issue is resulting in the loss of millions of dollars in sales as consumers are going across the border to Utah, Arizona and Idaho to purchase OHVs because they don’t have to pay sales tax. Normally, an out-of-state consumer pays sales tax when they return to their state and buy the vehicle’s necessary titling. Since Nevada does not require OHV titling, the consumer doesn’t have to pay such taxes.
“The Motorcycle Industry Council showed us we were losing about $34 million a year in sales” of OHV products, Fisher said. “We don’t mind competing with people, but we want to compete on a level playing field.”
To do that, the association will be introducing legislation that requires titling and registration and that the fees generated from that go to a state agency to fund trail development and maintenance. The need for such a program has become crucial
as the U.S. Forest Service has issued an edict requiring trails to be defined within the next two years, Fisher said. “If the trails are not on a map, they don’t exist anymore” after that two-year period.
“The Forest Service doesn’t have the funds to go out there and do all the mapping,” she said. “It’s up to the individual OHV clubs and individuals to do it. So we’re hoping to fund some of that” with the legislation, which will be proposed in February.
Another key issue the association is delving into is an F&I nightmare that was created by unscrupulous business practices in the auto industry. A state consumer protection bill was enacted to do away with “yo-yo sales,” a method where auto dealers sell consumers on an expected credit rating. The rating is given, the consumer trades in their vehicle and they drive home with a new car. Some days later, the auto dealership tells the consumer their credit rating is higher than expected, so they’ll be paying higher monthly payments, and they can’t come back and get their trade-in because it’s already been sold.
So a state law was passed requiring simple, fixed-rate interest loans for motor vehicles. The state’s Department of Motor Vehicles interpreted that to mean revolving credit programs would no longer be allowed for any street vehicles, including on-road motorcycles. That came as a shock to powersports dealers, who use OEM finance programs in 60 percent of their street bike sales. Many of those OEM programs include revolving credit options.
Fisher said the dealer association is working with F&I companies, like HSBC, to see what can be done to get such revolving credit programs reinstated. Fisher also is hopeful a newly elected state attorney general may take a different interruption of the law.

The Georgia Motorcycle Dealers Association started on a rare snowy day in Atlanta last December when a dozen dealers agreed to start the organization. Since then, the group has grown to include 40 members, said Kerima Haynes, the group’s association manager. That still only represents about half or less than half of the total number of dealers in the state. In hopes of enticing more dealers to join, the organization is going to revise its fee structure “so that smaller dealers don’t feel like they’re having to pay an unfair portion,” said association Chairman Ken Shiver, Millennium Cycle Works, Lilburn, Ga. Also in hopes of drawing more members from the southern part of the state, the group’s Jan. 15 meeting will be held in Macon.
Since its inception, the group has hired a lobbyist as it hopes to pass state legislation in 2007 that addresses franchise protection. The bill, scheduled to be introduced in January, would spell out the conditions of an OEM termination, including what the manufacturer has to purchase back and at what rates. It also would create a larger franchise radius area than the current
8-mile zone, which was established in 1974. “We’re trying to have a larger radius for urban and rural areas based on some other state laws we’ve seen,” Shiver said, noting the group is currently deciding on how large it believes the franchise radius should be.
After the legislation is introduced, Shiver said “we will try to put together as much of a grassroots effort to have dealers in Georgia, whether they have joined the association or not, contact their local representative and state senators to discuss the benefits of the law, discuss the importance of preserving a viable business climate for dealers and hopefully enlist their support.
“I believe a lot of dealers, once they see we’ve been able to craft legislation and have it introduced, will realize that these people (associated with the association) are serious,” Shiver said.
“We’re very hopeful of having a one-day, statewide convention in the summer to plan a more comprehensive plan for the future.”

This dealer association had been inactive for about 10 years before it was restarted in June. The group has 18 dealer members, association management said. Other related recreational group members are invited to join the dealer association, although only member dealers are allowed to vote on issues. The association, which is still defining what specific issues they’re going to tackle, is looking to hire a lobbyist.

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