Local news stories affecting the auto body industry in California, Nevada, Oregon, Washington, Idaho, Montana, Hawaii, Alaska and Wyoming
A proposed crash tax ordinance before the Sacramento City Council sends a message that Sacramento operates like a small-town speed trap, gouging unwary non-resident drivers, according to Sam Sorich, president of the Association of California Insurance Companies.
Sorich intends to testify against the proposed ordinance, which was scheduled to receive a final City Council vote August 17 at Sacramento City Hall but was postponed until September 14, according to the Sacramento Bee.
The ordinance would impose a tax—or what the city calls a fee—on non-Sacramento residents who are involved in traffic accidents within the city limits. The fee would be imposed on at-fault, non-resident drivers.
“Sacramento is rightly proud to be the capital of America’s largest state. It should be welcoming with open arms those from outside Sacramento who work in the city and visitors from around the world.
“Instead, the city plans literally to add insult to injury,” said Sorich.
He noted that Sacramento, like most local governments, faces some tough economic challenges. But taxing out-of-town motorists—including the thousands of workers who commute into the city every day—is dreadfully wrong and unfair. The ordinance anticipates contracting with a third-party billing company that will bill insurance companies. The ordinance’s scheme is based on the notion that insurance companies will pay the bill.
“But the fact is that auto insurance policies were never designed to cover these fees. Therefore, many accident victims will be forced to pay the tax out of their own pockets. The fees could be $2,000 or more. For insurers who pay the tax, it represents an increase in costs—which in turn could affect rates for all drivers.
“One sure thing in all of this is that the billing company that gets the city contract will always get paid first. The billing company takes its cut. Then it sends the rest of the payment to the city,” Sorich said.
ACIC’s president pointed out that the city envisions that the billing company will determine fault. The decision of fault will be made by the same company that profits from the tax.
“Drivers won’t get a fair shake,” said Sorich. He added that the proposed ordinance is in effect double taxation. The emergency services are paid for with property taxes. Sacramento, as a result, will be double-dipping at the expense of motorists. For non-resident drivers who have accidents, its taxation without representation.
“The ordinance also could end up hurting and not helping the city. It anticipates additional revenue but fails to consider the amount of lost sales revenue when residents from surrounding areas and potential visitors decide to stay away to avoid being taxed for just being in an accident.
“The ordinance tells Californians —who come to work in Sacramento, who come to the city for recreation, shopping and entertainment and who come to Sacramento to visit their state capital—that they are second-class citizens,” said Sorich.
The California Bureau of Automotive Repair (BAR), within the state’s department of Consumer Affairs, has proposed changes to its Smog Check Program. The BAR wants to update the regulations involved in the Smog Check Program to speed up the retirement of older, high-polluting vehicles. The program was designed to reduce emissions by requiring vehicles to meet certain standards. Owners of vehicles not meeting these standards can retire their vehicles for monetary compensation.
Currently, the regulations involve retiring vehicles for failing biennial smog checks. Among the new regulations is a plan to incorporate off-cycle vehicles into the program. As a result of these new monetary incentives, it is believed that 11,500 additional older vehicles could be removed from the road annually.
The Automotive Service Association encourages independent repairers to visit its legislative website, www.TakingTheHill.com, to view the BAR’s proposed regulation.
The California Air Resources Board (CARB) has mandated that all service centers are required to check and inflate customer’s tires to the manufacturer’s recommended pressure--regardless of whether or not the car’s service has anything to do with tires. California’s goal is to reduce greenhouse gas emissions from cars driving around with under-inflated tires, which have higher rolling resistance. These circumstances result in cars using more fuel and thereby emitting more greenhouse gasses. Initiated in 2009, the law’s intent is to help car owners to have their vehicle’s tire pressure checked every time the car comes in for service.
In its third and latest revision, the regulation applies to all automotive service providers who do maintenance or repair service, but excludes certain automotive repair shops including auto body, auto glass installer, auto dismantlers, and auto parts retailers.
There could be gray areas if a service provider offers a mix of services, such as repair and body shop work. Also, consumers who have nitrogen filled tires can decline inflation service if the shop does not have nitrogen filling capacity. Shops would be required to keep accurate pressure gauges to check tires, but how they would ensure gauge accuracy is unclear. Questions remain on checking tire pressure in traditionally cold and hot states, as well as determining the responsibility of deciding if the tire is unsafe when performing the service.
The U.S. Senate Committee on Energy and Natural Resources met July 21 for a markup of Senate Bill (S.B.) 3495, “The Promoting Electric Vehicles Act of 2010”; S.B. 2843, “The Advanced Vehicle Technology Act of 2009” and S.B. 679, “The Heavy Duty Hybrid Vehicle Research, Development and Demonstration Act of 2009.” The committee did not finalize its work on S.B. 679 and will address this bill at a later committee meeting. Both S.B. 3495 and 2843 were reported out of the committee.
“The Promoting Electric Vehicles Act of 2010,” sponsored by Sen. Byron Dorgan, D-N.D., introduced last month, aims to reduce the United States’ dependency on foreign oil and significantly reduce greenhouse gas emissions.
The main component of the bill is Title I, “The National Plug-In Electric Drive Vehicle Deployment Program,” which aims to:
-Reduce the use of petroleum by accelerating the deployment of plug-in electric-drive vehicles in the United States.
-Reduce greenhouse gas emissions by accelerating the deployment of plug-in electric-drive vehicles in the United States.
-Facilitate the rapid deployment of plug-in electric-drive vehicles.
-Achieve significant market penetrations by plug-in electric-drive vehicles nationally.
-Establish models for the rapid deployment of plug-in electric-drive vehicles nationally, including models for the deployment of residential, private and publicly available charging infrastructure.
-Increase consumer knowledge and acceptance of plug-in electric-drive vehicles.
-Encourage the innovation and investment necessary to achieve mass-market deployment of plug-in electric-drive vehicles.
-Facilitate the integration of plug-in electric-drive vehicles into electricity distribution systems and the larger electric grid while maintaining grid system performance and reliability.
-Provide technical assistance to communities across the United States to prepare for plug-in electric-drive vehicles.
-Support workforce training across the United States relating to plug-in electric drive vehicles.
Introduced last year, S.B. 2843, “The Advanced Vehicle Technology Act of 2009,” sponsored by Sen. Debbie Stabenow, D-Mich., seeks to promote federal aid for developing and promoting new vehicle technologies. The main purposes of this legislation include:
-Developing and promoting the deployment of technologies and practices that:
A. Improve the fuel efficiency and emissions of all vehicles produced in the United States.
B. Reduce vehicle reliance on petroleum-based fuels.
-Supporting domestic research, development, demonstration, deployment, engineering and commercial application and domestic manufacturing of advanced vehicles, engines and components.
-Enabling vehicles to move larger volumes of goods and more passengers with less energy and emissions.
-Developing cost-effective advanced technologies for wide-scale utilization throughout the passenger, commercial, government and transit vehicle sectors.
-Allowing for greater consumer choice of domestic-made vehicle technologies and fuels.
-Shortening technology development and integration cycles in the domestic vehicle industry.
-Ensuring a proper balance and diversity of federal investment in domestic-made vehicle technologies.
-Promoting the integration of intelligent vehicle technologies with infrastructure-based information and communications systems and the electrical grid.
-Strengthening partnerships between federal and state governmental agencies and the private and academic sectors.
To view a complete summary of the legislation, along with the full text, visit the “Track Legislation” section of ASA’s legislative website, www.TakingTheHill.com.
The Automotive Service Association is the largest not-for-profit trade association of its kind dedicated to and governed by independent automotive service and repair professionals. ASA serves an international membership base that includes numerous affiliate, state and chapter groups from both the mechanical and collision repair segments of the automotive service industry. ASA’s headquarters is in Bedford, Texas. ASA advances professionalism and excellence in the automotive repair industry through education, representation and member services. For additional information about ASA, including past news releases, go to www.ASAshop.org, or visit ASA’s legislative website at www.TakingTheHill.com.
Nevada Department of Business & Industry Director Dianne Cornwall announced the appointment of Brett J. Barratt as the new Commissioner of the Division of Insurance.
Barratt replaces Scott J. Kipper, who resigned the position in June.
Barratt, an attorney, has extensive experience in insurance regulation. Beginning in February 2005, he served as the Insurance Counsel/Hearing Officer for the Division. In October 2009, he became the Chief Insurance Assistant for the Division.
“Mr. Barratt comes to us with extensive knowledge of insurance regulation as well as strong legislative expertise and legal experience,” Director Cornwall said. “He has already proven his ability to lead during a transition, and I look forward to his ongoing oversight of this dynamic agency.”
The Division regulates and licenses insurance producers, brokers and other professionals; sets ethical and financial standards for insurance companies; and reviews rates.
The Division also reviews programs operated by self-insured employers for workers’ compensation, and investigates claims of insurance fraud.
According to the California Environmental Protection Agency's Air Resources Board, hybrid vehicles with the yellow Clean Air Vehicle stickers will no longer have access to High Occupancy Vehicle (HOV) or carpool lanes with only one occupant.
The EPA decided to allow only white Clean Air Vehicle sticker carrying vehicles in HOV lanes with a single occupant after the popularity of hybrid vehicles has become too much for HOV lanes to handle.
California law allows single-occupant use of HOV lanes by qualifying clean alternative fuel vehicles. Use of these lanes with only one occupant requires a Clean Air Vehicle Sticker issued by the California Department of Motor Vehicles (DMV).
There are two types of stickers; White Clean Air Vehicle Stickers are available to an unlimited number of qualifying Federal Inherently Low Emission Vehicles (ILEVs). Cars that meet these requirements are typically certified pure zero emission vehicles (100% battery electric and hydrogen fuel cell) and compressed natural gas (CNG) vehicles. Assembly Bill 1500 extended the expiration of white stickers to January 1, 2015.
In the fall of 2006, five independent-minded shop owners in Northern California agreed that the collision industry needed steering —toward better protection for shop owners and consumers, that is.
“They were tired of the manner in which industry issues were being addressed and wanted to take a more aggressive stance on the issues,” says Lee Amaradio, CRA’s second president and owner of Faith Quality Auto Body in Murietta. “We lobby our positions vigorously,” says Amaradio.
Those founding members are current board members and shop owners Roy Carnevale, Anthony’s Auto Craft, San Rafael, and Blake Andros, Blake’s Auto Body, with shops in Marin and Sonoma counties, as well as Byron Orris, Byron’s Auto Body in Napa, an owner and general member.
Two of the original founders, Todd Bishop and Gene Crozat, are no longer members. Crozat, the original president and owner of three G&C AutoBody shops in Northern California, had been critical of CRA’s direction even before his departure.
“The association grew out of frustration with the way industry issues were being addressed,” says Allen Wood, executive director for CRA. Owner of a consulting business, he was formerly a program manager for the California Bureau of Automotive Repair.
A Nevada legislative subcommittee has agreed to seek a bill requiring auto shops to check the air pressure in customer vehicles.
State Sen. Mike Schneider, a Las Vegas Democrat, says it will increase highway safety, save gas and reduce air pollution.
The bill would be considered during the 2011 legislative session.
Not all lawmakers were for it.
Republican Assemblywoman Heidi Gansert of Reno said while checking air pressure in tires is a good idea, she opposed mandating tire checks, saying it comes down to personal responsibility.
The California Assembly Committee on Business, Professions and Consumer Protection did not take up Senate Bill 350, a bill regulating aftermarket crash parts. This replacement crash parts legislation prohibits insurers from mandating the use of non-original equipment manufacturer (non-OEM) aftermarket crash parts (ACPs) unless the following requirements are met:
• The parts are at least equal to the original equipment manufacturer parts in terms of kind, quality, safety, fit and performance.
• The insurer specifying the use of non-original equipment manufacturer aftermarket crash parts shall pay the cost of any modifications to the parts that may become necessary to affect the repair.
• The insurer specifying the use of non-original equipment manufacturer aftermarket crash parts shall warrant that those parts are of like kind, quality, safety, fit and performance as original equipment manufacturer aftermarket crash parts.
• All original and non-original equipment manufacturer aftermarket crash parts manufactured on or after Jan. 1, 2011, when supplied by auto body repair shops, as defined in Section 9889.51 of the Business and Professions Code, shall carry sufficient permanent, non-removable identification so as to identify the manufacturer. This identification shall be accessible to the greatest extent possible after installation.
See July Autobody News for more details on this bill
The California Department of Insurance and the Attorney General's Office held joint meetings on June 24th and 25th with insurers, suppliers, manufacturers and trade associations that are a part of the supply chain for aftermarket parts specified during the settlement of insurance claims.
CRA has challenged the insurance industry's compliance with regulations that call for aftermarket parts specified in the claims process to be at least equal to the original equipment manufacturer parts in terms of kind, quality, safety, fit and performance.
California Repair Association President Lee Amaradio stated, "It is encouraging to see the Department of Insurance and the Attorney General's office showing interest in the is important consumer issue, though the outcome is uncertain . We hope their involvement will result in permanent change and a fair and compliant claims process. All most all insurers have recognized the issue and stopped specifying non-compliant parts and they should be commended for that. We now need a permanent solution."
Amaradio added "this all started when Toby Chess demonstrated differences between OEM and non-original equipment manufacturer aftermarket crash parts. CRA recognized the importance of his demonstration and moved the issue forward putting pressure on CDI to fulfill its regulatory mandate. It appears they may now be doing so."
CRA Executive Director Allen Wood added, "vehicles should not be reengineered as part of the claims process. The regulations governing these issues deal with insurance not auto repair. We want to insure that consumers (claimants) receive high quality, competent, safe repairs. The evolution of this issue is a graphic example of how a trade association that is responsive to the issues and is willing to step up can promote change. This is not over. However, with the Attorney General involved, we are extremely encouraged."