BILL ANALYSIS                                                                                                                                                                                                    



                                                                       



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                              UNFINISHED BUSINESS


          Bill No:  SB 1004
          Author:   Huff (R), et al
          Amended:  8/16/10
          Vote:     21

           
           SENATE TRANSPORTATION & HOUSING COMMITTEE :  8-0, 3/23/10
          AYES:  Lowenthal, Huff, Ashburn, DeSaulnier, Kehoe,  
            Oropeza, Pavley, Simitian
          NO VOTE RECORDED:  Harman

           SENATE APPROPRIATIONS COMMITTEE  :  Senate Rule 28.8

           SENATE FLOOR  :  34-0, 5/3/10 (Consent)
          AYES:  Aanestad, Ashburn, Cedillo, Cogdill, Corbett,  
            Correa, Cox, Denham, DeSaulnier, Ducheny, Dutton, Florez,  
            Hancock, Harman, Hollingsworth, Huff, Kehoe, Leno, Liu,  
            Lowenthal, Negrete McLeod, Oropeza, Padilla, Pavley,  
            Price, Romero, Runner, Simitian, Strickland, Walters,  
            Wolk, Wright, Wyland, Yee
          NO VOTE RECORDED:  Alquist, Calderon, Steinberg, Wiggins,  
            Vacancy, Vacancy

           ASSEMBLY FLOOR  :  76-0, 8/17/10 - See last page for vote


           SUBJECT  :    Vehicles:  licensed dealers and salespersons:   
          credit scores

           SOURCE  :     California New Motor Car Dealers Association


           DIGEST  :    This bill allows a vehicle dealer to post copies  
                                                           CONTINUED





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          of occupational licenses, rather than the original  
          licenses, for the dealer and the salespersons the dealer  
          employs. It also allows a vehicle salesperson to work for  
          multiple dealerships, provided that those dealerships share  
          a common controlling ownership, and requires a motor  
          vehicle dealer, for each credit report he or she obtains  
          for use in connection with a consumer's credit application,  
          to provide that consumer a summary of the information, as  
          specified.

           Assembly Amendments  require a motor vehicle dealer, for  
          each credit report he or she obtains for use in connection  
          with a consumer's credit application, to provide that  
          consumer a summary of the information from the credit  
          report that corresponds to the current federal credit score  
          reporting requirements that apply to vehicle dealers, and  
          allow the Department of Motor Vehicles to refund a dealer's  
          cash deposit that has been submitted in lieu of a dealer  
          bond after five years from the date a bond is secured.

           ANALYSIS  :    Existing law charges the Department of Motor  
          Vehicles (DMV) with licensing and regulating motor vehicle  
          dealers and salespersons who conduct business in  
          California. 

          State law requires that vehicle dealers post in a  
          conspicuous, public place in each and every location where  
          the dealer does business the dealer's DMV-issued dealer's  
          license plus the DMV-issued license of each salesperson  
          employed by that dealer at that location. Each licensed  
          sales person employed by a dealer must provide that dealer  
          with his/her salesperson license for posting.  In addition,  
          existing law precludes a salesperson from working for more  
          than one dealer, although he/she can work at different  
          locations of a single dealer, provided each location has  
          identical ownership and structure.

          Existing law permits DMV to refuse to issue or to revoke or  
          suspend a vehicle salesperson's license if, among other  
          things, the salesperson has acted as a salesperson for more  
          than one licensed dealer.  State law also makes it illegal  
          for a person to duplicate a vehicle salesperson's license  
          in such a way that it could be mistaken for a valid  
          license.







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          This bill:

          1. Allows motor vehicle dealers and salespersons to post  
             exact copies of their licenses, in lieu of the actual  
             licenses, at the dealer's place of business. 

          2. Allows a salesperson to work for more than one dealer if  
             all of the dealers for whom he or she works have common  
             controlling ownership, which is defined as when more  
             than 50% of the ownership interests in each dealer are  
             held by the same person or persons, either directly or  
             through one or more wholly owned subsidiary entities. 

          3. Requires the salesperson's license, or license copy, to  
             be posted at each dealership where he or she is  
             employed. 

          4. Requires any copy of the salesperson's license to be  
             destroyed by the dealer upon termination of the  
             salesperson's employment with that dealer.

          5. Allows DMV to refund a dealer's cash deposit that has  
             been submitted in lieu of a dealer bond after five years  
             from the date a bond is secured and maintained, if the  
             DMV is satisfied there are no outstanding claims against  
             that deposit.

          6. Requires a motor vehicle dealer, for each credit report  
             he or she obtains for use in connection with a  
             consumer's credit application, to provide that consumer  
             a summary of the information from the credit report that  
             corresponds to the current federal credit score  
             reporting requirements that apply to vehicle dealers.

          7. Provides that this requirement does not limit or  
             restrict any rights or remedies otherwise available  
             under existing law.

           Background
           
          The author's office introduced this bill to update  
          California law governing motor vehicle dealers and  
          salespersons to reflect changes in the operation and  







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          structure of companies selling motor vehicles.  This bill  
          specifically recognizes that dealerships today are  
          organized in a wide variety of structures from sole  
          proprietorships to publicly traded corporations.  State law  
          governing dealers' employment of salespersons dates from a  
          bygone era.  This bill changes that law to allow dealers to  
          post copies, rather than originals, of occupational  
          licenses.  It also allows a salesperson to work for  
          multiple dealerships so long as 50 percent the ownership of  
          each dealership is the same. 

           FISCAL EFFECT  :    Appropriation:  No   Fiscal Com.:  Yes    
          Local:  Yes

           SUPPORT  :   (Verified  8/18/10)

          California New Motor Car Dealers Association


           ASSEMBLY FLOOR : 
          AYES: Adams, Ammiano, Anderson, Arambula, Bass, Beall, Bill  
            Berryhill, Tom Berryhill, Block, Blumenfield, Bradford,  
            Brownley, Buchanan, Caballero, Carter, Chesbro, Conway,  
            Cook, Coto, Davis, De Leon, DeVore, Eng, Evans, Feuer,  
            Fletcher, Fong, Fuentes, Fuller, Furutani, Gaines,  
            Galgiani, Garrick, Gatto, Gilmore, Hagman, Hall, Harkey,  
            Hayashi, Hernandez, Hill, Huber, Huffman, Jeffries,  
            Jones, Knight, Lieu, Logue, Bonnie Lowenthal, Ma,  
            Mendoza, Miller, Monning, Nava, Nestande, Niello,  
            Nielsen, Norby, V. Manuel Perez, Portantino, Ruskin,  
            Salas, Saldana, Silva, Skinner, Smyth, Solorio, Audra  
            Strickland, Swanson, Torlakson, Torres, Torrico, Tran,  
            Villines, Yamada, John A. Perez
          NO VOTE RECORDED: Blakeslee, Charles Calderon, De La Torre,  
            Vacancy


          JJA:do  8/18/10   Senate Floor Analyses 

                         SUPPORT/OPPOSITION:  SEE ABOVE

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