BILL ANALYSIS Ó SB 642 Page 1 Date of Hearing: August 17, 2011 ASSEMBLY COMMITTEE ON APPROPRIATIONS Felipe Fuentes, Chair SB 642 (Padilla) - As Amended: July 13, 2011 Policy Committee: JudiciaryVote:8-2 Transportation 10-0 Urgency: No State Mandated Local Program: No Reimbursable: No SUMMARY This bill: 1)Prohibits the waiver, whether by coercion or voluntarily, of a dealer's right to protest actions, such as termination of franchise, to the New Motor Vehicle Board (NMVB). 2)Allows temporary manufacturer-ownership of an auto dealership only under limited circumstances and prohibits a manufacturer from taking certain actions preferable to a manufacturer-owned dealership. 3)Prohibits manufacturers from discriminating against franchised dealers for selling certain products and services not approved by the manufacturer. FISCAL EFFECT Minor, absorbable costs to the Department of Motor Vehicles (DMV), which administers the NMVB a quasi-judicial program to resolve disputes between franchised dealers and manufacturers and distributors of new motor vehicles, including automobiles, recreational vehicles, motorcycles, all-terrain vehicles, heavy trucks and buses. COMMENTS Rationale . The author intends this bill to prevent a dealer franchise owner from being coerced by manufacturers into negotiating away their right to appeal disputes to the NMVB and to prevent manufacturers from engaging in practices that SB 642 Page 2 unfairly discriminate against franchise dealers. Analysis Prepared by : Jay Dickenson / APPR. / (916) 319-2081