SEMA News—April 2013 

VEHICLE TECHNOLOGY
By SEMA News Staff

Does Our Industry Have Five Years Left?

A Few Words With John Waraniak

The SEMA Vehicle Technology Center (VTC) and its four Tech Zones focus on vehicle performance, dynamics, connectivity and personalization. It is designed to be relevant to today’s enthusiasts as well as to appeal to tomorrow’s next generation of performance and technology enthusiasts by bringing greater focus to current advanced vehicle technology and emerging aftermarket opportunities. Look to the September issue of SEMA News for an overview of the vehicles and programs that will be featured in the VTC at the 2013 SEMA Show.

John Waraniak, SEMA’s vice president of vehicle technology, has tinkered with machines and building fast toys since he was a kid growing up in Detroit. Waraniak is equally at home in an aerospace skunkworks in Pico Rivera, California, a boardroom in Mumbai, India, on a motocross track in Buchanan, Michigan, or on the Vehicle Technology Center stage at the SEMA Show in Las Vegas. His love for racing, performance and systems engineering have led him to master’s degrees at the University of Illinois and Caltech as well as executive careers in the stealth aircraft, automotive racing and action sports industries. He was eventually recruited as SEMA’s “chief engineer” in May 2006.

SEMA News: What is the most crucial takeaway for SEMA members regarding the current state of vehicle technology?

John Waraniak: We may very well wake up some morning five years from now and realize that there’s no one left to buy our performance products because younger drivers are less interested in driving and our industry has been legislated away by safety and fuel-efficiency regulations. You may find yourself driving a sensibly styled compact sedan capable of speeds no greater than 85 mph.

The performance aftermarket needs to be at the forefront of a concerted effort by the entire auto industry to protect consumers against legislation that would outlaw vehicle modifications. Manufacturers of performance equipment had better get together and start testing their products and understanding their impact on vehicle emissions and safety performance. This is a project that should be led by SEMA.

	In this annual vehicle technology overview, Waraniak talked with SEMA News about why SEMA companies need to understand the increasing impact that advanced vehicle technology has on their current businesses and growth opportunities as well as the four megatrends central to the future of the automotive performance aftermarket: Driving Green, Driving Connected, Driving Safe and Driving Cool.
	John Waraniak, SEMA’s vice president of vehicle technology, has tinkered with machines and building fast toys since he was a kid growing up in Detroit. He joined the association staff as SEMA’s “chief engineer” in May 2006.

This scenario isn’t a remote possibility. The interesting thing is that it was envisioned and taken directly from pages printed 42 years ago in the January 1971 issue of High Performance News & Products, the predecessor of today’s SEMA News. When SEMA President and CEO Chris Kersting included this scenario in his opening remarks at the SEMA Installation Banquet last July, it got me and a lot of people thinking: Does our industry have five years left? What can SEMA do? What has SEMA done lately? The answer is—a lot!

SN: Technology constantly creates changes to vehicles and, consequently, to automotive aftermarket businesses. What should SEMA members understand about the current and future state of vehicle technology and how to protect their businesses in the face of ongoing technological changes?

JW: Members should stop wishing for the good old days and use this time to embrace new vehicle technologies by challenging conventional wisdom with new thinking to create their preferred futures. To be sure, leading through uncertainty was tough, and no one is immune to the structural changes our industry continues to go through. The range of possible futures confronting specialty-equipment businesses was great; however, companies that focused on flexibility and situational awareness survived the financial crisis better than those that chose to ignore the consequences of inaction.

Technology roadmaps are scenario plans that align your short-term and long-term business objectives with specific technology developments, innovations and solutions to help you achieve your strategic, tactical and operational goals. Developing a technology roadmap for your business has two major benefits: First, it helps you develop a common understanding about a set of goals and the technologies impacting those goals, and second, it provides a framework to help you connect those technologies to your products and markets and create your preferred future.

The framework for my remarks this year are based on the scenario outlined above—“Does Our Industry Have Five Years Left?”—and what SEMA is doing with its vehicle technology programs and partners to help members be successful and protect the performance industry. In today’s race to innovate, you cannot simply Google the answers you need. SEMA’s vehicle technology programs and partnerships are designed to provide members with relevant, up-to-date information, knowledge and solutions to help them compete today and prepare for tomorrow.

The automotive specialty-equipment industry has been and will always be challenged by complex vehicle technologies, federal regulations, systems integration and safety considerations. SEMA’s vehicle technology department is continually working to provide unique and cost-effective benefits and value to members by developing vehicle technology programs and solutions as well as building relationships that foster collaboration between automakers, suppliers, manufacturers, research organizations, industry associations and member companies. Technology is a dual-edged sword: There’s being first, and then there’s being best. To understand the current and future state of vehicle technology requires new ways of thinking: design thinking and social thinking.

SN: Let’s take those concepts individually. First, what do you mean by “design thinking”?

The first order of business for SEMA members is to understand the social context of new technologies. The second is the product technology content.

JW: Design thinking is focused on technology content, problem solving and logic. It is a top-down, focus-group, expert-driven product development process. My friend and longtime SEMA advocate Ralph Gilles, president and CEO of the SRT brand and senior vice president of design at Chrysler, is a design thinker. He says that a vehicle has to have what he calls “good bones” to be successful. Cars are blank canvases to Gilles. He believes that customization validates a vehicle platform rather than trumping the brand. Gilles recently stated that technology is the game-changer for car designers, and it’s the reason consumers will buy a car in the future.

	Nick Woodman, founder and CEO of GoPro, presented an exciting Racing and Performance keynote address on the opening day of the SEMA Show. Racing and the performance lifestyle are critical to continued relevance and innovation within the SEMA community for longtime members as well as new companies and brands such as GoPro.

Social thinking is quite the opposite and is focused on technology context, benefits received and emotion. It is a bottom-up, frontline, crowd-driven innovation process. Jim Farley, head of global marketing at Ford, is a social thinker. Farley is a strong believer in brand democracy and letting go of the brand through fan sourcing, which taps groups of enthusiasts and fans with ideas and empowers designers and marketers with powerful insights and frontline product context. The Fiesta Movement grassroots social media experiment was a great example of fan sourcing.

Design and social thinking are both important. They are critical to your success and how you think about technology and its impact on your business. The first order of business for SEMA members is to understand the social context of new technologies. The second is product technology content. Customers buy your products but, more importantly, they buy what your products do for them. You need to sell the benefits of your products and services to your fans and enthusiasts.

The point-of-view camera company GoPro understands better than its competitors and many other companies that customers showing off what they did with GoPro Hero3 cameras on YouTube is far more valuable than clips of them talking about their cameras. Apple, Google, Oakley, Nike and GoPro are excellent examples of companies that effectively think of their products as technology content and their social packaging as technology context. Design-thinking principles based on technology content, together with social-thinking principles based on technology context, are central to understanding the current and future state of vehicle technology—particularly in the post-2009 automotive business.

SN: Several of the advanced vehicle technologies that we’ve talked about in recent years—cameras, sensors, radars, connected vehicle technologies and autonomous driving systems—are now becoming routine and, in some cases, required equipment in new vehicles. Are there projects, such as self-driving cars, now in development that may become equally commonplace in the next three to five years?

JW: Many of the connected-vehicle and semi-autonomous driving technologies are already here. The National Highway Transportation Safety Administration wants to ramp up the development and deployment of vehicle-to-vehicle communication systems and is actively considering requiring the technology to be fitted to vehicles within the next several years. By next year, more than 70% of all consumer devices will be connected to the Internet, and many consumers—particularly young drivers—want to extend their digital lifestyles into their vehicles. By 2017, the connected car will become a mainstream reality, with more than 60% of the world’s cars offering features such as built-in Internet, wireless connectivity and driver notifications.

	Roy Link, president and CEO of Link Engineering, was one of the featured speakers on the Race to Innovate forum panel and provided the SEMA Show audience with some great words from coach Vince Lombardi: “The only place where success comes before work is in the dictionary.”

Ford Motor Co. uses automotive sensors to optimize driving, helping the car go in the direction the driver wants it to. The new Ford Escape’s intelligent all-wheel-drive system gathers data from 25 external signals—including wheel speed, accelerator pedal position and steering wheel angle—to improve driving performance by readjusting the power split to give the driver a precise blend of handling and traction at all times. If the front of the vehicle is on ice and the rear is on pavement, the all-wheel-drive system can send all the torque the powertrain can produce to the rear, putting power where the driver needs it. The all-wheel-drive system also integrates with the interior so the driver can see the power distribution displayed on a screen inside the dash.

Self-driving cars may seem like science fiction, but now, three years after Google developed a fleet of them, autonomous cars could be on their way to our driveways. Google is the leader in autonomous technology for vehicles.

In California, Nevada and other states, legislators are rewriting the rules of the road to make way for driverless cars. Anthony Levandowski, head of Google’s automotive programs, provided one of the most exciting and well-attended keynotes at the SEMA Show last year with more than 380 attendees, and he mentioned that Google’s autonomous vehicles have been cruising the streets and highways of the San Francisco Bay area for the past two years and have logged more than 300,000 miles.

We are at least five to 10 years from mass production of autonomous vehicles, but driverless cars and technologies will eventually have enormous implications for SEMA companies, automakers, suppliers, society and the economy. There are many significant business threats as well as technology opportunities for market leaders and new players.

On the opportunity side, autonomous vehicles and technologies will allow for the reinvention and re-design of cars and automotive business models as well as revenue, organizational models and industry dynamics. Without having to worry about distracted driving, automotive and consumer electronics companies, app developers and social media companies will be able to equip cars with all the infotainment products, systems, features and functions they can possibly make and sell.

For many businesses, driverless cars will provide an opportunity to either make or lose an awful lot of money. Incumbent companies rarely do well when new technologies disrupt an industry. The companies that develop technology roadmaps and best prepare for a world of connected and autonomous vehicle technologies will win over those that don’t.

Next-generation enthusiasts were born online and raised on technology. They want the fastest cars as well as the smartest cars. For some, 4G tops a V8.

Autonomous and connected-vehicle technologies—combined with mobile and consumer electronics—have extended far beyond the vehicle itself. Cars that communicate with each other are already on the road, but what will it take to get consumers really interested in vehicle-to-vehicle (V2V) capabilities? This year’s TBS program in the VTC will explore the market opportunities for V2V devices and services and help SEMA members understand how they can leverage new technologies and business opportunities in integrating consumer and automotive electronics.

SN: Alternative fuels, hybrids, battery-electric vehicles (BEVs) and small-displacement engines have become more prevalent as fuel prices edge ever higher. What types of powertrain and driveline technologies are taking precedence in the area of fuel economy, and how quickly or slowly might they be embraced on a large scale?

JW: Despite disappointing sales, automakers believe electric vehicles are not dead, and I agree. The electric car is not dead, but it certainly needs resuscitating. The battery technology and cost just aren’t ready.

	Anthony Levandowski, head of Google’s automotive technology programs, provided the Connected Vehicle Technology keynote address and brought along one of his team’s latest self-driving vehicles loaded with autonomous systems.

Mark Reuss, president of GM North America, summed it up well. “People will embrace electric cars when prices come down,” he said. “The rest of them will come around when technology advances electric vehicles to the point where they offer comparable performance at comparable prices.”

Corporate Average Fuel Economy (CAFE) regulations are scheduled to rise significantly in the coming years. Automakers in the United States must meet standards of 35.5 miles per gallon by 2016 and 54.5 mpg by 2025. It’s a tremendous challenge to get to these numbers, and it’s going to generate a lot of new technology and innovation in the industry.

Expect OEM performance-car builders to pay close attention to their models’ mileage. This will likely include expanded use of lighter-weight materials, such as aluminum, magnesium and carbon fiber. Decreasing a vehicle’s mass by 10% enables about a 3% increase in fuel economy. Expect widespread use of dual clutches and eight- and nine-gear transmissions along with technologies, such as direct fuel injection and turbocharging, to continue helping make smaller engines perform like larger ones. We’ll also increasingly see stop-start systems that automatically stop an engine while the car is at idle to save fuel.

Automakers will have to continue investing in new powertrain technologies; however, the best days of the internal-combustion gas engine are still ahead. The reason for the internal-combustion engine’s continued dominance is the fact it still has tremendous potential for improvement and innovation.

Gasoline engines will someday be phased out in favor of hybrid and electrified vehicles, but their continued evolution promises it will be a fun ride for many SEMA companies for quite a while.

SN: Are there any trends in marketing—social media and mobile communications, for instance—that are driving automotive-technology trends?

JW: That’s a very interesting question. It’s actually kind of the opposite: Advanced technologies are driving new marketing trends.

Your products represent your technology content. Marketing is packaging the social context of your technology and products. Technology combined with social media has democratized traditional marketing and branding strategies. Brand democracy is about letting go and turning your brand over to consumers, fans and enthusiasts. You need to market with consumers, not to them.

Brand democracy isn’t about choices in media but choices in mindset. Awareness means nothing; relevance means everything. For many of our members, the SEMA Show represents a major portion of their marketing budgets. I am starting to notice that leading trade shows, such as the SEMA Show, Consumer Electronics Show (CES) and Agenda Show, are emerging as social media platforms and are integrating lifestyle marketing approaches.

	SEMA teamed with Global RallyCross (GRC) to stage the final race of the season at the SEMA Show. The fusing of GRC and ESPN’s X-Games has been a catalyst for many action-sports athletes migrating from other sports to motorsports and provides an excellent platform for making small cars cool.

While the traditional trade show business model and several major conferences died years ago, leaders such as SEMA, CES and Agenda have embraced the lifestyle and enthusiast dimensions of the automotive, technology and apparel industries, respectively. For example, the SEMA Show is an auto show but, more importantly, it’s an automotive lifestyle show.

As Director of Ford Racing Jamie Allison said at our “Racing and Performance” forum in November: “SEMA is the intersection of cars and car culture.” The SEMA Show is the Gemba for cool cars, car culture and the automotive enthusiast lifestyle.

Cool follows a Kano curve model. There is no point of diminishing return. To paraphrase the king of cool, Steve McQueen: “The SEMA Show is life. Everything before or after is just waiting.”

SN: What about the fear that young people no longer consider an automobile as a necessity?

JW: Next-generation enthusiasts were born online and raised on technology. They want the fastest cars as well as the smartest cars. For some, 4G tops a V8. Winning over young Millennial buyers is critical to the growth of the auto industry, but the performance industry can help match horsepower with computing power.

Generation-O is the generation of 10- to 29-year-olds known as optimizers, and they are two billion strong worldwide. Sixty percent of today’s youth sleep with their phones, and 80% would spend their last $10 on topping off their phone, not their cars.

Gen-O will be the generation that shows the industry the way forward in how new technologies will be used to optimize the customer experience. Steve Jobs was instrumental in making computers and then phones cool, and now Apple is making smart cars cool.

	California Congresswoman Jackie Speier (far left) toured the SEMA Vehicle Technology Center and talked with the graduate students from Clemson University and Art Center College of Design who designed and built the Deep Orange project vehicle.

Jobs believed that you have to think differently and surround yourself with “the crazy ones.” In his famous Apple ad from 1997 he said: “Here’s to the crazy ones, the misfits, the rebels, the troublemakers, the round pegs in the square holes. The ones who see things differently. They’re not fond of rules. You can quote them, disagree with them, glorify or vilify them, but the only thing you can’t do is ignore them because they change things. They push us forward, and while some see them as the crazy ones, we see genius, because the ones who are crazy enough to think that they can change the world are the ones who do.”

Design thinkers, such as Beau Boeckmann from Galpin Auto Sports and Chip Foose, together with social thinkers, such as Myles Kovacs, founder of DUB and “Mad” Mike Martin, are some of SEMA’s next-generation of leaders pushing the performance industry forward.

SN: SEMA has been working with the Clemson University International Center for Automotive Research (CU-ICAR) on advanced-vehicle technology and a performance aftermarket education program. What are the latest developments with the SEMA-Clemson partnership?

JW: One of the really exciting initiatives SEMA developed to help future-proof our industry and ensure that we do indeed have five more years left is our innovative partnership with CU-ICAR. The partnership is focused on four major areas: Vehicle Dynamics, Vehicle Fuel Efficiency and Emissions, Vehicle Systems Integration and Blue Sky Generative Thinking to look into the future and help members capitalize on the newest technologies driving the automotive performance industry.

	Jamie Allison, director of Ford North American Racing, provided an excellent overview of why Ford races as well as a timeless quote characterizing and positioning the automotive and performance aftermarket: “SEMA is the intersection of cars and car culture.”

SEMA’s partnership with CU-ICAR is an industry-leading example of the association’s entrepreneurial approach to vehicle technology and generative thinking. SEMA and CU-ICAR teamed up three years ago to offer SEMA members unprecedented access to world-class performance product development analysis, testing, simulation resources and engineering talent.

The goal of the SEMA/CU-ICAR partnership offers two significant benefits. First and perhaps most importantly, the relationship with CU-ICAR provides a look into the automotive future in a way that no individual SEMA company could hope to achieve. This is a benefit that is difficult to quantify but is crucial to the continued growth and future of the performance aftermarket, given the rapid pace of technology change in the automotive industry. Secondly, the relationship with CU-ICAR offers the opportunity for SEMA members to access world-class physical and human resources to help develop affordable solutions to address immediate problems and emerging challenges facing SEMA-member companies.

SEMA’s Vehicle Dynamics Program and participating member companies have made significant achievements over the past five years in understanding how performance products, such as suspension, brakes, wheels, tires and steering, as well as engine modifications, interact with electronic stability control (ESC) and other active safety systems. Today, as part of an integrated chassis and body system, performance suspension systems are a key area where one vehicle can be truly differentiated from another and build the essential DNA of the vehicle and the brand.

We will have a comprehensive update on the SEMA/CU-ICAR partnership in the coming months, and three business case-study workshops documenting the benefits received by SEMA members will be included in the VTC program at the 2013 SEMA Show.

SN: Of all the ideas we’ve discussed here, what are the one or two most important vehicle technology concepts that SEMA members should keep on top of?

JW: Technology has the power to make, move and reshape markets; however, vehicles are more than technology. They represent who we are. They are works of art, fun, power and fashion. To understand the current and future state of vehicle technology requires new ways of thinking—design thinking and social thinking.

Advanced vehicle technologies are coming from both inside and outside the auto industry. The challenge remains how effectively the content and context of these new systems and technologies gets integrated into vehicles and consumer lifestyles by automakers and the aftermarket. Automakers give a car heart, but SEMA members give a car soul.

Many performance aftermarket companies fear that active safety systems, such as ESC, adaptive cruise control and autonomous driving systems, signal the demise of the specialty-equipment industry. They believe that tighter federal emissions and increasing fuel-efficiency standards will eliminate performance vehicles and parts from America’s roadways. Well, that simply is not true.

Today’s situation is no different than it was back in 1971. Competition and innovation remain the twin brothers of technology. The smartest SEMA companies always find innovative ways to address advanced vehicle technology challenges. Innovation is the engine of growth. As Facebook founder and CEO Mark Zuckerberg says: “The key to innovation is to move fast and break things.”

Executive Summary:For additional information, contact SEMA Vice President of Vehicle Technology John Waraniak at johnw@sema.org or visit the SEMA Vehicle Technology website at www.sema.org/vehicletechnology.

SEMA News—April 2013 

LEGISLATIVE AND TECHNICAL AFFAIRS
By Steve McDonald

Law and Order

STATE UPDATE

Arkansas Racing Facilities: SEMA is supporting Arkansas legislation to require the consent of only 38% of property owners and registered voters within three miles of a proposed motor-vehicle racing facility before construction of the facility can begin. Currently, construction requires the approval of 75% of property owners and voters.

California Legacy License Plates: Last year, legislation was enacted to establish the California Legacy License Plate Program. Under the new law, the DMV will create and issue a series of specialized license plates that replicate plates from the state’s past. The plates are now available for pre-order using a form available on the DMV website. The plates cost $50 for non-personalized or personalized plates. The law specifies that 7,500 applications must be received by January 1, 2015.

Colorado Emissions: Legislation has been introduced in Colorado to extend the emissions-inspection exemption to vehicles that have not yet reached their 10th model year. Current law exempts only vehicles that are four model years old or newer. The SEMA-supported bill would also exempt previously registered motor vehicles that have never failed an emissions-control inspection and create a senior citizen hardship exemption whereby a senior citizen may register one motor vehicle without obtaining an emissions inspection.

Connecticut Property Taxes: SEMA is opposing legislation to eliminate a provision in the Connecticut statutes that allows antiques, rare or special-interest motor vehicles to be assessed at a value of no more than $500. Under the bill, valuation of these vehicles will be done in the same manner as all other motor vehicles in the state. Vehicles in Connecticut are taxed by the municipality in which they are registered, and rates vary by municipality. The municipality calculates the owner’s tax liability for a particular vehicle by multiplying the “mill rate” by 70% of the vehicle’s true and actual value. Tax assessors are looking to target motor vehicles for additional revenue at a time when it appears that property taxes are increasing for many Connecticut citizens on other taxable property.

Maine Tire Size: Legislation has been introduced in Maine to remove a provision in the law that requires the overall diameter of motor vehicle tires be within 2 in. of the sizes recommended by the vehicle manufacturer. The Maine Motor Vehicle Inspection Manual already requires a vehicle to fail inspection if a tire contacts any part of the body of the vehicle. This bill provides that a vehicle must still comply with applicable frame-height requirements that vary according to gross vehicle weight rating. Because tire size will affect frame height, frame-height limits can already effectively regulate against inappropriate tire size.

Maryland License Plates: Legislation has been introduced in Maryland to require the issuance of only a single license plate for motor vehicles. The bill, favored by state hobbyists, requires that the single registration plate be attached on the front of tractors and on the rear of all other vehicles. For vehicles required to display two registration plates, a second bill provides that the front plate may be stored inside the vehicle if the vehicle was manufactured without a means to secure and display a front plate.

Missouri License Plates: Legislation has been introduced in Missouri to require the issuance of only a single license plate for motor vehicles. The bill also applies to personalized plates. If enacted into law, the measure would allow vehicle owners to obtain a second plate under limited circumstances (e.g., certain property-carrying commercial motor-vehicle applicants can request two plates). Among other things, the measure would save money, conserve resources and bring Missouri in line with other states that have moved to a single-plate requirement.

Montana Year-of-Manufacture Plates: Legislation to allow the owner of a motor vehicle, trailer, semitrailer or pole trailer manufactured in the year 1948, 1949 or 1950 to display a single original Montana license plate that is affixed to the rear of the vehicle was approved by the House of Representatives. Under the bill, the original Montana license plate must be legible and must bear the year that matches the year in which the vehicle was manufactured. The Montana Senate will next consider the bill.

Montana Inoperable Vehicles: Legislation to provide a limit on the number of inoperable motor vehicles allowed to accumulate on private property under “community decay” laws has been introduced in Montana. Under the bill, more than three “junk vehicles” on private property would constitute community decay. In Montana, a “junk vehicle” means a motor vehicle, including component parts, that is discarded, ruined, wrecked or dismantled; is not lawfully and validly licensed; and that remains inoperative or incapable of being driven. Even vehicles that are permanently registered but meet these criteria are considered junk vehicles. The bill establishes no provisions that would enable vehicles located out of public view to avoid being classified as junk.

Nebraska Headlamps: SEMA is contesting legislation introduced in Nebraska to require headlamps to be “clear or of a white color” without further requiring that they comply with U.S. Department of Transportation (DOT) standards regarding lighting equipment. Under the DOT standard, it is possible to design a headlamp that emits a light that is perceived as having a blue tint but which nevertheless remains within the boundaries that define “white.”

New York Wheels: SEMA is again opposing legislation to require vehicle identification numbers (VIN) on the wheels of motor vehicles assembled or sold in New York. All wheels sold in the United States generally comply with industry standards, which include markings with the wheel manufacturer’s name, trademark or symbol, date of manufacture and manufacturer’s part number or code. Wheels are already identifiable without imposing a VIN-marking burden. Both Congress and the National Highway Traffic Safety Administration (NHTSA) have determined that wheel markings of the type contemplated by this bill would impose a huge burden on the wheel makers, automakers and dealers. In addition, as noted, wheels already have distinguishable markings.

New York Historic Vehicles: SEMA-supported legislation has been reintroduced in New York to provide that historical-vehicle owners pay only a one-time registration fee of $100 upon initial registration. The bill was approved by the full Senate last session but died in the Assembly when the legislature adjourned for the year. Under New York law, a historical motor vehicle is either a vehicle manufactured more than 25 years ago or one which has unique characteristics and that is determined to be of historical, classic or exhibition value. The reduced registration fee would be available to owners of historical vehicles owned and operated as exhibition pieces or collectors’ items and used for club activities, exhibits, tours, parades, occasional transportation and similar uses. The $100 one-time fee would replace the current annual fee of $28.75.

Vermont Exhaust Systems: A bill to ban motor vehicle exhaust systems that increase noise levels has been reintroduced in Vermont. Under the bill, violators would not pass the state’s required inspection and would be subject to fines. The measure does not provide an opportunity for vehicle hobbyists to install and use exhaust systems that meet an objective decibel limit under a fair and predictable test and would make it difficult for hobbyists to replace factory exhaust systems with more durable, better-performing options.

Virginia Restoration Projects: Legislation containing a SEMA amendment to totally exempt from the license tax vehicles and parts cars stored on private property for the purpose of restoration or repair was approved by the House of Delegates. The license tax is applied to vehicles that do not display current license plates. Under the bill, vehicles stored within a structure would remain exempt from the tax. The Virginia Senate will next consider the bill.

Virginia License Plates: Pressured by opposition from the state’s law enforcement community, Virginia legislation to reduce from two to one the number of license plates furnished by the DMV to registered motor vehicles was pulled from consideration by the bill’s sponsor. Under the bill, the DMV would have required the single plate to be attached to the rear of the vehicle. The bill was stricken by a unanimous vote of the Senate Transportation Committee and is unlikely to return this session.

Washington Inoperable Vehicles: A version of SEMA-model legislation to prohibit cities or towns from enforcing an ordinance, development regulation, zoning regulation or administrative practice that prevents automobile collectors from pursuing their hobby was approved by the Senate Governmental Operations Committee and Rules Committee. Under the bill, junked, wrecked or inoperable vehicles stored on private property would require only screening from public view. Six or fewer vehicles that are 30 years old or older, including one parts car, would be permitted for hobby-vehicle restoration as long as restoration is an ancillary use of the property. The full Washington Senate will next hear the bill.

Wyoming Registration Fees: SEMA-opposed legislation to increase annual vehicle registration fees by $10 for passenger vehicles and double registration fees for non-commercial trucks died in the Wyoming House of Representatives. Under the bill, non-commercial trucks subject to the doubled registration fees would have included personal pickup trucks. Also, the measure made no special exception for antiques, custom vehicles or street rods that constitute a small portion of the vehicle fleet, are infrequently operated and are deserving of lower registration fees.

FEDERAL UPDATE

Johnson Valley OHV Area: An estimated 60,000 enthusiasts and participants attended the seventh annual “King of the Hammers” in early February. It is the largest off-roading event held at the Johnson Valley California OHV Recreation Area. SEMA is working with the Off-Road Business Association and a coalition of other land-use advocacy organizations to ensure that the land remains open to organized and individual off-highway vehicle (OHV) pursuits. The Marine Corps wants to expand its base at Twentynine Palms to include ownership of nearly 147,000 acres of adjacent land in Johnson Valley in order to conduct large-scale training exercises for one or two months a year. The OHV community is urging the Marines to obtain special-use permits from the U.S. Bureau of Land Management, which owns the land. The OHV community petitioned the White House for support of the special-use permit approach. More than 25,000 signatures required for an official administration response were received in just two weeks. The community is now awaiting a White House response. The Marines are required to submit a study to Congress by April 2, 2013 on how they might share the land with the OHV community.

E15 Ethanol: A federal appeals court dismissed on technicalities a lawsuit that challenged the Environmental Protection Agency’s (EPA) authority to permit the sale of 15% ethanol (E15) content in gasoline for ’01 and newer model-year cars and light trucks. The case may be appealed to the U.S. Supreme Court. SEMA continues to oppose the sale of E15 gasoline. Many older cars were not constructed with materials to counteract ethanol’s ability to absorb water and cause corrosion. E15 can also burn hotter than E10 gasoline and cause damage to certain high-performance specialty parts. The EPA has approved the sale of E15 for use in ’01 and newer vehicles while making it illegal to fuel older cars, motorcycles and other motorized equipment. However, the EPA is requiring only a gas-pump warning label instructing unsuspecting consumers that it is “illegal” to fill those products with E15. SEMA has joined with a number of other trade associations in seeking to enact legislation to repeal the E15 rule.

Minimum Sound Level for Electric Cars: The NHTSA has issued a proposed rule that will require hybrid and electric vehicles to make a minimum level of sound in order to alert pedestrians and bicyclists of their presence. The automakers would have a wide selection of choices when creating a sound. The sound would need to be detectable over a range of street noises when the vehicle is moving under 18 miles per hour. At 18 mph and above, the vehicle should produce sufficient sound on its own to be heard.

Home Office Deduction: The Internal Revenue Service has announced a simplified option for deducting the costs associated with having a home business office. The new optional approach is based on the amount of square feet being used for business purposes by the taxpayer. If it is 300 sq. ft. or less, the taxpayer can claim a deduction of $5 per square foot (up to $1,500 per year). The existing approach is to fill out Form 8829, which may require complex calculations of allocated expenses, depreciation and carryovers of unused deductions. Under the new option, taxpayers can still claim allowable mortgage interest, real estate taxes and casualty losses on the home as itemized deductions on Schedule A, but they cannot depreciate the portion of the home used for business. These deductions need not be allocated between personal and business use, as is required under the regular method. Current restrictions on the home office deduction, such as the requirement that a home office must be used regularly and exclusively for business, still apply under the new option, which is available starting with the 2013 tax return.

SEMA News—April 2013 

LEGISLATIVE AND TECHNICAL AFFAIRS
By Steve McDonald

Law and Order

STATE UPDATE

Arkansas Racing Facilities: SEMA is supporting Arkansas legislation to require the consent of only 38% of property owners and registered voters within three miles of a proposed motor-vehicle racing facility before construction of the facility can begin. Currently, construction requires the approval of 75% of property owners and voters.

California Legacy License Plates: Last year, legislation was enacted to establish the California Legacy License Plate Program. Under the new law, the DMV will create and issue a series of specialized license plates that replicate plates from the state’s past. The plates are now available for pre-order using a form available on the DMV website. The plates cost $50 for non-personalized or personalized plates. The law specifies that 7,500 applications must be received by January 1, 2015.

Colorado Emissions: Legislation has been introduced in Colorado to extend the emissions-inspection exemption to vehicles that have not yet reached their 10th model year. Current law exempts only vehicles that are four model years old or newer. The SEMA-supported bill would also exempt previously registered motor vehicles that have never failed an emissions-control inspection and create a senior citizen hardship exemption whereby a senior citizen may register one motor vehicle without obtaining an emissions inspection.

Connecticut Property Taxes: SEMA is opposing legislation to eliminate a provision in the Connecticut statutes that allows antiques, rare or special-interest motor vehicles to be assessed at a value of no more than $500. Under the bill, valuation of these vehicles will be done in the same manner as all other motor vehicles in the state. Vehicles in Connecticut are taxed by the municipality in which they are registered, and rates vary by municipality. The municipality calculates the owner’s tax liability for a particular vehicle by multiplying the “mill rate” by 70% of the vehicle’s true and actual value. Tax assessors are looking to target motor vehicles for additional revenue at a time when it appears that property taxes are increasing for many Connecticut citizens on other taxable property.

Maine Tire Size: Legislation has been introduced in Maine to remove a provision in the law that requires the overall diameter of motor vehicle tires be within 2 in. of the sizes recommended by the vehicle manufacturer. The Maine Motor Vehicle Inspection Manual already requires a vehicle to fail inspection if a tire contacts any part of the body of the vehicle. This bill provides that a vehicle must still comply with applicable frame-height requirements that vary according to gross vehicle weight rating. Because tire size will affect frame height, frame-height limits can already effectively regulate against inappropriate tire size.

Maryland License Plates: Legislation has been introduced in Maryland to require the issuance of only a single license plate for motor vehicles. The bill, favored by state hobbyists, requires that the single registration plate be attached on the front of tractors and on the rear of all other vehicles. For vehicles required to display two registration plates, a second bill provides that the front plate may be stored inside the vehicle if the vehicle was manufactured without a means to secure and display a front plate.

Missouri License Plates: Legislation has been introduced in Missouri to require the issuance of only a single license plate for motor vehicles. The bill also applies to personalized plates. If enacted into law, the measure would allow vehicle owners to obtain a second plate under limited circumstances (e.g., certain property-carrying commercial motor-vehicle applicants can request two plates). Among other things, the measure would save money, conserve resources and bring Missouri in line with other states that have moved to a single-plate requirement.

Montana Year-of-Manufacture Plates: Legislation to allow the owner of a motor vehicle, trailer, semitrailer or pole trailer manufactured in the year 1948, 1949 or 1950 to display a single original Montana license plate that is affixed to the rear of the vehicle was approved by the House of Representatives. Under the bill, the original Montana license plate must be legible and must bear the year that matches the year in which the vehicle was manufactured. The Montana Senate will next consider the bill.

Montana Inoperable Vehicles: Legislation to provide a limit on the number of inoperable motor vehicles allowed to accumulate on private property under “community decay” laws has been introduced in Montana. Under the bill, more than three “junk vehicles” on private property would constitute community decay. In Montana, a “junk vehicle” means a motor vehicle, including component parts, that is discarded, ruined, wrecked or dismantled; is not lawfully and validly licensed; and that remains inoperative or incapable of being driven. Even vehicles that are permanently registered but meet these criteria are considered junk vehicles. The bill establishes no provisions that would enable vehicles located out of public view to avoid being classified as junk.

Nebraska Headlamps: SEMA is contesting legislation introduced in Nebraska to require headlamps to be “clear or of a white color” without further requiring that they comply with U.S. Department of Transportation (DOT) standards regarding lighting equipment. Under the DOT standard, it is possible to design a headlamp that emits a light that is perceived as having a blue tint but which nevertheless remains within the boundaries that define “white.”

New York Wheels: SEMA is again opposing legislation to require vehicle identification numbers (VIN) on the wheels of motor vehicles assembled or sold in New York. All wheels sold in the United States generally comply with industry standards, which include markings with the wheel manufacturer’s name, trademark or symbol, date of manufacture and manufacturer’s part number or code. Wheels are already identifiable without imposing a VIN-marking burden. Both Congress and the National Highway Traffic Safety Administration (NHTSA) have determined that wheel markings of the type contemplated by this bill would impose a huge burden on the wheel makers, automakers and dealers. In addition, as noted, wheels already have distinguishable markings.

New York Historic Vehicles: SEMA-supported legislation has been reintroduced in New York to provide that historical-vehicle owners pay only a one-time registration fee of $100 upon initial registration. The bill was approved by the full Senate last session but died in the Assembly when the legislature adjourned for the year. Under New York law, a historical motor vehicle is either a vehicle manufactured more than 25 years ago or one which has unique characteristics and that is determined to be of historical, classic or exhibition value. The reduced registration fee would be available to owners of historical vehicles owned and operated as exhibition pieces or collectors’ items and used for club activities, exhibits, tours, parades, occasional transportation and similar uses. The $100 one-time fee would replace the current annual fee of $28.75.

Vermont Exhaust Systems: A bill to ban motor vehicle exhaust systems that increase noise levels has been reintroduced in Vermont. Under the bill, violators would not pass the state’s required inspection and would be subject to fines. The measure does not provide an opportunity for vehicle hobbyists to install and use exhaust systems that meet an objective decibel limit under a fair and predictable test and would make it difficult for hobbyists to replace factory exhaust systems with more durable, better-performing options.

Virginia Restoration Projects: Legislation containing a SEMA amendment to totally exempt from the license tax vehicles and parts cars stored on private property for the purpose of restoration or repair was approved by the House of Delegates. The license tax is applied to vehicles that do not display current license plates. Under the bill, vehicles stored within a structure would remain exempt from the tax. The Virginia Senate will next consider the bill.

Virginia License Plates: Pressured by opposition from the state’s law enforcement community, Virginia legislation to reduce from two to one the number of license plates furnished by the DMV to registered motor vehicles was pulled from consideration by the bill’s sponsor. Under the bill, the DMV would have required the single plate to be attached to the rear of the vehicle. The bill was stricken by a unanimous vote of the Senate Transportation Committee and is unlikely to return this session.

Washington Inoperable Vehicles: A version of SEMA-model legislation to prohibit cities or towns from enforcing an ordinance, development regulation, zoning regulation or administrative practice that prevents automobile collectors from pursuing their hobby was approved by the Senate Governmental Operations Committee and Rules Committee. Under the bill, junked, wrecked or inoperable vehicles stored on private property would require only screening from public view. Six or fewer vehicles that are 30 years old or older, including one parts car, would be permitted for hobby-vehicle restoration as long as restoration is an ancillary use of the property. The full Washington Senate will next hear the bill.

Wyoming Registration Fees: SEMA-opposed legislation to increase annual vehicle registration fees by $10 for passenger vehicles and double registration fees for non-commercial trucks died in the Wyoming House of Representatives. Under the bill, non-commercial trucks subject to the doubled registration fees would have included personal pickup trucks. Also, the measure made no special exception for antiques, custom vehicles or street rods that constitute a small portion of the vehicle fleet, are infrequently operated and are deserving of lower registration fees.

FEDERAL UPDATE

Johnson Valley OHV Area: An estimated 60,000 enthusiasts and participants attended the seventh annual “King of the Hammers” in early February. It is the largest off-roading event held at the Johnson Valley California OHV Recreation Area. SEMA is working with the Off-Road Business Association and a coalition of other land-use advocacy organizations to ensure that the land remains open to organized and individual off-highway vehicle (OHV) pursuits. The Marine Corps wants to expand its base at Twentynine Palms to include ownership of nearly 147,000 acres of adjacent land in Johnson Valley in order to conduct large-scale training exercises for one or two months a year. The OHV community is urging the Marines to obtain special-use permits from the U.S. Bureau of Land Management, which owns the land. The OHV community petitioned the White House for support of the special-use permit approach. More than 25,000 signatures required for an official administration response were received in just two weeks. The community is now awaiting a White House response. The Marines are required to submit a study to Congress by April 2, 2013 on how they might share the land with the OHV community.

E15 Ethanol: A federal appeals court dismissed on technicalities a lawsuit that challenged the Environmental Protection Agency’s (EPA) authority to permit the sale of 15% ethanol (E15) content in gasoline for ’01 and newer model-year cars and light trucks. The case may be appealed to the U.S. Supreme Court. SEMA continues to oppose the sale of E15 gasoline. Many older cars were not constructed with materials to counteract ethanol’s ability to absorb water and cause corrosion. E15 can also burn hotter than E10 gasoline and cause damage to certain high-performance specialty parts. The EPA has approved the sale of E15 for use in ’01 and newer vehicles while making it illegal to fuel older cars, motorcycles and other motorized equipment. However, the EPA is requiring only a gas-pump warning label instructing unsuspecting consumers that it is “illegal” to fill those products with E15. SEMA has joined with a number of other trade associations in seeking to enact legislation to repeal the E15 rule.

Minimum Sound Level for Electric Cars: The NHTSA has issued a proposed rule that will require hybrid and electric vehicles to make a minimum level of sound in order to alert pedestrians and bicyclists of their presence. The automakers would have a wide selection of choices when creating a sound. The sound would need to be detectable over a range of street noises when the vehicle is moving under 18 miles per hour. At 18 mph and above, the vehicle should produce sufficient sound on its own to be heard.

Home Office Deduction: The Internal Revenue Service has announced a simplified option for deducting the costs associated with having a home business office. The new optional approach is based on the amount of square feet being used for business purposes by the taxpayer. If it is 300 sq. ft. or less, the taxpayer can claim a deduction of $5 per square foot (up to $1,500 per year). The existing approach is to fill out Form 8829, which may require complex calculations of allocated expenses, depreciation and carryovers of unused deductions. Under the new option, taxpayers can still claim allowable mortgage interest, real estate taxes and casualty losses on the home as itemized deductions on Schedule A, but they cannot depreciate the portion of the home used for business. These deductions need not be allocated between personal and business use, as is required under the regular method. Current restrictions on the home office deduction, such as the requirement that a home office must be used regularly and exclusively for business, still apply under the new option, which is available starting with the 2013 tax return.

SEMA News—April 2013 

LEGISLATIVE AND TECHNICAL AFFAIRS
By Steve McDonald

Law and Order

STATE UPDATE

Arkansas Racing Facilities: SEMA is supporting Arkansas legislation to require the consent of only 38% of property owners and registered voters within three miles of a proposed motor-vehicle racing facility before construction of the facility can begin. Currently, construction requires the approval of 75% of property owners and voters.

California Legacy License Plates: Last year, legislation was enacted to establish the California Legacy License Plate Program. Under the new law, the DMV will create and issue a series of specialized license plates that replicate plates from the state’s past. The plates are now available for pre-order using a form available on the DMV website. The plates cost $50 for non-personalized or personalized plates. The law specifies that 7,500 applications must be received by January 1, 2015.

Colorado Emissions: Legislation has been introduced in Colorado to extend the emissions-inspection exemption to vehicles that have not yet reached their 10th model year. Current law exempts only vehicles that are four model years old or newer. The SEMA-supported bill would also exempt previously registered motor vehicles that have never failed an emissions-control inspection and create a senior citizen hardship exemption whereby a senior citizen may register one motor vehicle without obtaining an emissions inspection.

Connecticut Property Taxes: SEMA is opposing legislation to eliminate a provision in the Connecticut statutes that allows antiques, rare or special-interest motor vehicles to be assessed at a value of no more than $500. Under the bill, valuation of these vehicles will be done in the same manner as all other motor vehicles in the state. Vehicles in Connecticut are taxed by the municipality in which they are registered, and rates vary by municipality. The municipality calculates the owner’s tax liability for a particular vehicle by multiplying the “mill rate” by 70% of the vehicle’s true and actual value. Tax assessors are looking to target motor vehicles for additional revenue at a time when it appears that property taxes are increasing for many Connecticut citizens on other taxable property.

Maine Tire Size: Legislation has been introduced in Maine to remove a provision in the law that requires the overall diameter of motor vehicle tires be within 2 in. of the sizes recommended by the vehicle manufacturer. The Maine Motor Vehicle Inspection Manual already requires a vehicle to fail inspection if a tire contacts any part of the body of the vehicle. This bill provides that a vehicle must still comply with applicable frame-height requirements that vary according to gross vehicle weight rating. Because tire size will affect frame height, frame-height limits can already effectively regulate against inappropriate tire size.

Maryland License Plates: Legislation has been introduced in Maryland to require the issuance of only a single license plate for motor vehicles. The bill, favored by state hobbyists, requires that the single registration plate be attached on the front of tractors and on the rear of all other vehicles. For vehicles required to display two registration plates, a second bill provides that the front plate may be stored inside the vehicle if the vehicle was manufactured without a means to secure and display a front plate.

Missouri License Plates: Legislation has been introduced in Missouri to require the issuance of only a single license plate for motor vehicles. The bill also applies to personalized plates. If enacted into law, the measure would allow vehicle owners to obtain a second plate under limited circumstances (e.g., certain property-carrying commercial motor-vehicle applicants can request two plates). Among other things, the measure would save money, conserve resources and bring Missouri in line with other states that have moved to a single-plate requirement.

Montana Year-of-Manufacture Plates: Legislation to allow the owner of a motor vehicle, trailer, semitrailer or pole trailer manufactured in the year 1948, 1949 or 1950 to display a single original Montana license plate that is affixed to the rear of the vehicle was approved by the House of Representatives. Under the bill, the original Montana license plate must be legible and must bear the year that matches the year in which the vehicle was manufactured. The Montana Senate will next consider the bill.

Montana Inoperable Vehicles: Legislation to provide a limit on the number of inoperable motor vehicles allowed to accumulate on private property under “community decay” laws has been introduced in Montana. Under the bill, more than three “junk vehicles” on private property would constitute community decay. In Montana, a “junk vehicle” means a motor vehicle, including component parts, that is discarded, ruined, wrecked or dismantled; is not lawfully and validly licensed; and that remains inoperative or incapable of being driven. Even vehicles that are permanently registered but meet these criteria are considered junk vehicles. The bill establishes no provisions that would enable vehicles located out of public view to avoid being classified as junk.

Nebraska Headlamps: SEMA is contesting legislation introduced in Nebraska to require headlamps to be “clear or of a white color” without further requiring that they comply with U.S. Department of Transportation (DOT) standards regarding lighting equipment. Under the DOT standard, it is possible to design a headlamp that emits a light that is perceived as having a blue tint but which nevertheless remains within the boundaries that define “white.”

New York Wheels: SEMA is again opposing legislation to require vehicle identification numbers (VIN) on the wheels of motor vehicles assembled or sold in New York. All wheels sold in the United States generally comply with industry standards, which include markings with the wheel manufacturer’s name, trademark or symbol, date of manufacture and manufacturer’s part number or code. Wheels are already identifiable without imposing a VIN-marking burden. Both Congress and the National Highway Traffic Safety Administration (NHTSA) have determined that wheel markings of the type contemplated by this bill would impose a huge burden on the wheel makers, automakers and dealers. In addition, as noted, wheels already have distinguishable markings.

New York Historic Vehicles: SEMA-supported legislation has been reintroduced in New York to provide that historical-vehicle owners pay only a one-time registration fee of $100 upon initial registration. The bill was approved by the full Senate last session but died in the Assembly when the legislature adjourned for the year. Under New York law, a historical motor vehicle is either a vehicle manufactured more than 25 years ago or one which has unique characteristics and that is determined to be of historical, classic or exhibition value. The reduced registration fee would be available to owners of historical vehicles owned and operated as exhibition pieces or collectors’ items and used for club activities, exhibits, tours, parades, occasional transportation and similar uses. The $100 one-time fee would replace the current annual fee of $28.75.

Vermont Exhaust Systems: A bill to ban motor vehicle exhaust systems that increase noise levels has been reintroduced in Vermont. Under the bill, violators would not pass the state’s required inspection and would be subject to fines. The measure does not provide an opportunity for vehicle hobbyists to install and use exhaust systems that meet an objective decibel limit under a fair and predictable test and would make it difficult for hobbyists to replace factory exhaust systems with more durable, better-performing options.

Virginia Restoration Projects: Legislation containing a SEMA amendment to totally exempt from the license tax vehicles and parts cars stored on private property for the purpose of restoration or repair was approved by the House of Delegates. The license tax is applied to vehicles that do not display current license plates. Under the bill, vehicles stored within a structure would remain exempt from the tax. The Virginia Senate will next consider the bill.

Virginia License Plates: Pressured by opposition from the state’s law enforcement community, Virginia legislation to reduce from two to one the number of license plates furnished by the DMV to registered motor vehicles was pulled from consideration by the bill’s sponsor. Under the bill, the DMV would have required the single plate to be attached to the rear of the vehicle. The bill was stricken by a unanimous vote of the Senate Transportation Committee and is unlikely to return this session.

Washington Inoperable Vehicles: A version of SEMA-model legislation to prohibit cities or towns from enforcing an ordinance, development regulation, zoning regulation or administrative practice that prevents automobile collectors from pursuing their hobby was approved by the Senate Governmental Operations Committee and Rules Committee. Under the bill, junked, wrecked or inoperable vehicles stored on private property would require only screening from public view. Six or fewer vehicles that are 30 years old or older, including one parts car, would be permitted for hobby-vehicle restoration as long as restoration is an ancillary use of the property. The full Washington Senate will next hear the bill.

Wyoming Registration Fees: SEMA-opposed legislation to increase annual vehicle registration fees by $10 for passenger vehicles and double registration fees for non-commercial trucks died in the Wyoming House of Representatives. Under the bill, non-commercial trucks subject to the doubled registration fees would have included personal pickup trucks. Also, the measure made no special exception for antiques, custom vehicles or street rods that constitute a small portion of the vehicle fleet, are infrequently operated and are deserving of lower registration fees.

FEDERAL UPDATE

Johnson Valley OHV Area: An estimated 60,000 enthusiasts and participants attended the seventh annual “King of the Hammers” in early February. It is the largest off-roading event held at the Johnson Valley California OHV Recreation Area. SEMA is working with the Off-Road Business Association and a coalition of other land-use advocacy organizations to ensure that the land remains open to organized and individual off-highway vehicle (OHV) pursuits. The Marine Corps wants to expand its base at Twentynine Palms to include ownership of nearly 147,000 acres of adjacent land in Johnson Valley in order to conduct large-scale training exercises for one or two months a year. The OHV community is urging the Marines to obtain special-use permits from the U.S. Bureau of Land Management, which owns the land. The OHV community petitioned the White House for support of the special-use permit approach. More than 25,000 signatures required for an official administration response were received in just two weeks. The community is now awaiting a White House response. The Marines are required to submit a study to Congress by April 2, 2013 on how they might share the land with the OHV community.

E15 Ethanol: A federal appeals court dismissed on technicalities a lawsuit that challenged the Environmental Protection Agency’s (EPA) authority to permit the sale of 15% ethanol (E15) content in gasoline for ’01 and newer model-year cars and light trucks. The case may be appealed to the U.S. Supreme Court. SEMA continues to oppose the sale of E15 gasoline. Many older cars were not constructed with materials to counteract ethanol’s ability to absorb water and cause corrosion. E15 can also burn hotter than E10 gasoline and cause damage to certain high-performance specialty parts. The EPA has approved the sale of E15 for use in ’01 and newer vehicles while making it illegal to fuel older cars, motorcycles and other motorized equipment. However, the EPA is requiring only a gas-pump warning label instructing unsuspecting consumers that it is “illegal” to fill those products with E15. SEMA has joined with a number of other trade associations in seeking to enact legislation to repeal the E15 rule.

Minimum Sound Level for Electric Cars: The NHTSA has issued a proposed rule that will require hybrid and electric vehicles to make a minimum level of sound in order to alert pedestrians and bicyclists of their presence. The automakers would have a wide selection of choices when creating a sound. The sound would need to be detectable over a range of street noises when the vehicle is moving under 18 miles per hour. At 18 mph and above, the vehicle should produce sufficient sound on its own to be heard.

Home Office Deduction: The Internal Revenue Service has announced a simplified option for deducting the costs associated with having a home business office. The new optional approach is based on the amount of square feet being used for business purposes by the taxpayer. If it is 300 sq. ft. or less, the taxpayer can claim a deduction of $5 per square foot (up to $1,500 per year). The existing approach is to fill out Form 8829, which may require complex calculations of allocated expenses, depreciation and carryovers of unused deductions. Under the new option, taxpayers can still claim allowable mortgage interest, real estate taxes and casualty losses on the home as itemized deductions on Schedule A, but they cannot depreciate the portion of the home used for business. These deductions need not be allocated between personal and business use, as is required under the regular method. Current restrictions on the home office deduction, such as the requirement that a home office must be used regularly and exclusively for business, still apply under the new option, which is available starting with the 2013 tax return.

SEMA News—April 2013 

LEGISLATIVE AND TECHNICAL AFFAIRS
By Steve McDonald

Law and Order

STATE UPDATE

Arkansas Racing Facilities: SEMA is supporting Arkansas legislation to require the consent of only 38% of property owners and registered voters within three miles of a proposed motor-vehicle racing facility before construction of the facility can begin. Currently, construction requires the approval of 75% of property owners and voters.

California Legacy License Plates: Last year, legislation was enacted to establish the California Legacy License Plate Program. Under the new law, the DMV will create and issue a series of specialized license plates that replicate plates from the state’s past. The plates are now available for pre-order using a form available on the DMV website. The plates cost $50 for non-personalized or personalized plates. The law specifies that 7,500 applications must be received by January 1, 2015.

Colorado Emissions: Legislation has been introduced in Colorado to extend the emissions-inspection exemption to vehicles that have not yet reached their 10th model year. Current law exempts only vehicles that are four model years old or newer. The SEMA-supported bill would also exempt previously registered motor vehicles that have never failed an emissions-control inspection and create a senior citizen hardship exemption whereby a senior citizen may register one motor vehicle without obtaining an emissions inspection.

Connecticut Property Taxes: SEMA is opposing legislation to eliminate a provision in the Connecticut statutes that allows antiques, rare or special-interest motor vehicles to be assessed at a value of no more than $500. Under the bill, valuation of these vehicles will be done in the same manner as all other motor vehicles in the state. Vehicles in Connecticut are taxed by the municipality in which they are registered, and rates vary by municipality. The municipality calculates the owner’s tax liability for a particular vehicle by multiplying the “mill rate” by 70% of the vehicle’s true and actual value. Tax assessors are looking to target motor vehicles for additional revenue at a time when it appears that property taxes are increasing for many Connecticut citizens on other taxable property.

Maine Tire Size: Legislation has been introduced in Maine to remove a provision in the law that requires the overall diameter of motor vehicle tires be within 2 in. of the sizes recommended by the vehicle manufacturer. The Maine Motor Vehicle Inspection Manual already requires a vehicle to fail inspection if a tire contacts any part of the body of the vehicle. This bill provides that a vehicle must still comply with applicable frame-height requirements that vary according to gross vehicle weight rating. Because tire size will affect frame height, frame-height limits can already effectively regulate against inappropriate tire size.

Maryland License Plates: Legislation has been introduced in Maryland to require the issuance of only a single license plate for motor vehicles. The bill, favored by state hobbyists, requires that the single registration plate be attached on the front of tractors and on the rear of all other vehicles. For vehicles required to display two registration plates, a second bill provides that the front plate may be stored inside the vehicle if the vehicle was manufactured without a means to secure and display a front plate.

Missouri License Plates: Legislation has been introduced in Missouri to require the issuance of only a single license plate for motor vehicles. The bill also applies to personalized plates. If enacted into law, the measure would allow vehicle owners to obtain a second plate under limited circumstances (e.g., certain property-carrying commercial motor-vehicle applicants can request two plates). Among other things, the measure would save money, conserve resources and bring Missouri in line with other states that have moved to a single-plate requirement.

Montana Year-of-Manufacture Plates: Legislation to allow the owner of a motor vehicle, trailer, semitrailer or pole trailer manufactured in the year 1948, 1949 or 1950 to display a single original Montana license plate that is affixed to the rear of the vehicle was approved by the House of Representatives. Under the bill, the original Montana license plate must be legible and must bear the year that matches the year in which the vehicle was manufactured. The Montana Senate will next consider the bill.

Montana Inoperable Vehicles: Legislation to provide a limit on the number of inoperable motor vehicles allowed to accumulate on private property under “community decay” laws has been introduced in Montana. Under the bill, more than three “junk vehicles” on private property would constitute community decay. In Montana, a “junk vehicle” means a motor vehicle, including component parts, that is discarded, ruined, wrecked or dismantled; is not lawfully and validly licensed; and that remains inoperative or incapable of being driven. Even vehicles that are permanently registered but meet these criteria are considered junk vehicles. The bill establishes no provisions that would enable vehicles located out of public view to avoid being classified as junk.

Nebraska Headlamps: SEMA is contesting legislation introduced in Nebraska to require headlamps to be “clear or of a white color” without further requiring that they comply with U.S. Department of Transportation (DOT) standards regarding lighting equipment. Under the DOT standard, it is possible to design a headlamp that emits a light that is perceived as having a blue tint but which nevertheless remains within the boundaries that define “white.”

New York Wheels: SEMA is again opposing legislation to require vehicle identification numbers (VIN) on the wheels of motor vehicles assembled or sold in New York. All wheels sold in the United States generally comply with industry standards, which include markings with the wheel manufacturer’s name, trademark or symbol, date of manufacture and manufacturer’s part number or code. Wheels are already identifiable without imposing a VIN-marking burden. Both Congress and the National Highway Traffic Safety Administration (NHTSA) have determined that wheel markings of the type contemplated by this bill would impose a huge burden on the wheel makers, automakers and dealers. In addition, as noted, wheels already have distinguishable markings.

New York Historic Vehicles: SEMA-supported legislation has been reintroduced in New York to provide that historical-vehicle owners pay only a one-time registration fee of $100 upon initial registration. The bill was approved by the full Senate last session but died in the Assembly when the legislature adjourned for the year. Under New York law, a historical motor vehicle is either a vehicle manufactured more than 25 years ago or one which has unique characteristics and that is determined to be of historical, classic or exhibition value. The reduced registration fee would be available to owners of historical vehicles owned and operated as exhibition pieces or collectors’ items and used for club activities, exhibits, tours, parades, occasional transportation and similar uses. The $100 one-time fee would replace the current annual fee of $28.75.

Vermont Exhaust Systems: A bill to ban motor vehicle exhaust systems that increase noise levels has been reintroduced in Vermont. Under the bill, violators would not pass the state’s required inspection and would be subject to fines. The measure does not provide an opportunity for vehicle hobbyists to install and use exhaust systems that meet an objective decibel limit under a fair and predictable test and would make it difficult for hobbyists to replace factory exhaust systems with more durable, better-performing options.

Virginia Restoration Projects: Legislation containing a SEMA amendment to totally exempt from the license tax vehicles and parts cars stored on private property for the purpose of restoration or repair was approved by the House of Delegates. The license tax is applied to vehicles that do not display current license plates. Under the bill, vehicles stored within a structure would remain exempt from the tax. The Virginia Senate will next consider the bill.

Virginia License Plates: Pressured by opposition from the state’s law enforcement community, Virginia legislation to reduce from two to one the number of license plates furnished by the DMV to registered motor vehicles was pulled from consideration by the bill’s sponsor. Under the bill, the DMV would have required the single plate to be attached to the rear of the vehicle. The bill was stricken by a unanimous vote of the Senate Transportation Committee and is unlikely to return this session.

Washington Inoperable Vehicles: A version of SEMA-model legislation to prohibit cities or towns from enforcing an ordinance, development regulation, zoning regulation or administrative practice that prevents automobile collectors from pursuing their hobby was approved by the Senate Governmental Operations Committee and Rules Committee. Under the bill, junked, wrecked or inoperable vehicles stored on private property would require only screening from public view. Six or fewer vehicles that are 30 years old or older, including one parts car, would be permitted for hobby-vehicle restoration as long as restoration is an ancillary use of the property. The full Washington Senate will next hear the bill.

Wyoming Registration Fees: SEMA-opposed legislation to increase annual vehicle registration fees by $10 for passenger vehicles and double registration fees for non-commercial trucks died in the Wyoming House of Representatives. Under the bill, non-commercial trucks subject to the doubled registration fees would have included personal pickup trucks. Also, the measure made no special exception for antiques, custom vehicles or street rods that constitute a small portion of the vehicle fleet, are infrequently operated and are deserving of lower registration fees.

FEDERAL UPDATE

Johnson Valley OHV Area: An estimated 60,000 enthusiasts and participants attended the seventh annual “King of the Hammers” in early February. It is the largest off-roading event held at the Johnson Valley California OHV Recreation Area. SEMA is working with the Off-Road Business Association and a coalition of other land-use advocacy organizations to ensure that the land remains open to organized and individual off-highway vehicle (OHV) pursuits. The Marine Corps wants to expand its base at Twentynine Palms to include ownership of nearly 147,000 acres of adjacent land in Johnson Valley in order to conduct large-scale training exercises for one or two months a year. The OHV community is urging the Marines to obtain special-use permits from the U.S. Bureau of Land Management, which owns the land. The OHV community petitioned the White House for support of the special-use permit approach. More than 25,000 signatures required for an official administration response were received in just two weeks. The community is now awaiting a White House response. The Marines are required to submit a study to Congress by April 2, 2013 on how they might share the land with the OHV community.

E15 Ethanol: A federal appeals court dismissed on technicalities a lawsuit that challenged the Environmental Protection Agency’s (EPA) authority to permit the sale of 15% ethanol (E15) content in gasoline for ’01 and newer model-year cars and light trucks. The case may be appealed to the U.S. Supreme Court. SEMA continues to oppose the sale of E15 gasoline. Many older cars were not constructed with materials to counteract ethanol’s ability to absorb water and cause corrosion. E15 can also burn hotter than E10 gasoline and cause damage to certain high-performance specialty parts. The EPA has approved the sale of E15 for use in ’01 and newer vehicles while making it illegal to fuel older cars, motorcycles and other motorized equipment. However, the EPA is requiring only a gas-pump warning label instructing unsuspecting consumers that it is “illegal” to fill those products with E15. SEMA has joined with a number of other trade associations in seeking to enact legislation to repeal the E15 rule.

Minimum Sound Level for Electric Cars: The NHTSA has issued a proposed rule that will require hybrid and electric vehicles to make a minimum level of sound in order to alert pedestrians and bicyclists of their presence. The automakers would have a wide selection of choices when creating a sound. The sound would need to be detectable over a range of street noises when the vehicle is moving under 18 miles per hour. At 18 mph and above, the vehicle should produce sufficient sound on its own to be heard.

Home Office Deduction: The Internal Revenue Service has announced a simplified option for deducting the costs associated with having a home business office. The new optional approach is based on the amount of square feet being used for business purposes by the taxpayer. If it is 300 sq. ft. or less, the taxpayer can claim a deduction of $5 per square foot (up to $1,500 per year). The existing approach is to fill out Form 8829, which may require complex calculations of allocated expenses, depreciation and carryovers of unused deductions. Under the new option, taxpayers can still claim allowable mortgage interest, real estate taxes and casualty losses on the home as itemized deductions on Schedule A, but they cannot depreciate the portion of the home used for business. These deductions need not be allocated between personal and business use, as is required under the regular method. Current restrictions on the home office deduction, such as the requirement that a home office must be used regularly and exclusively for business, still apply under the new option, which is available starting with the 2013 tax return.

SEMA News—April 2013 

LEGISLATIVE AND TECHNICAL AFFAIRS
By Steve McDonald

Law and Order

STATE UPDATE

Arkansas Racing Facilities: SEMA is supporting Arkansas legislation to require the consent of only 38% of property owners and registered voters within three miles of a proposed motor-vehicle racing facility before construction of the facility can begin. Currently, construction requires the approval of 75% of property owners and voters.

California Legacy License Plates: Last year, legislation was enacted to establish the California Legacy License Plate Program. Under the new law, the DMV will create and issue a series of specialized license plates that replicate plates from the state’s past. The plates are now available for pre-order using a form available on the DMV website. The plates cost $50 for non-personalized or personalized plates. The law specifies that 7,500 applications must be received by January 1, 2015.

Colorado Emissions: Legislation has been introduced in Colorado to extend the emissions-inspection exemption to vehicles that have not yet reached their 10th model year. Current law exempts only vehicles that are four model years old or newer. The SEMA-supported bill would also exempt previously registered motor vehicles that have never failed an emissions-control inspection and create a senior citizen hardship exemption whereby a senior citizen may register one motor vehicle without obtaining an emissions inspection.

Connecticut Property Taxes: SEMA is opposing legislation to eliminate a provision in the Connecticut statutes that allows antiques, rare or special-interest motor vehicles to be assessed at a value of no more than $500. Under the bill, valuation of these vehicles will be done in the same manner as all other motor vehicles in the state. Vehicles in Connecticut are taxed by the municipality in which they are registered, and rates vary by municipality. The municipality calculates the owner’s tax liability for a particular vehicle by multiplying the “mill rate” by 70% of the vehicle’s true and actual value. Tax assessors are looking to target motor vehicles for additional revenue at a time when it appears that property taxes are increasing for many Connecticut citizens on other taxable property.

Maine Tire Size: Legislation has been introduced in Maine to remove a provision in the law that requires the overall diameter of motor vehicle tires be within 2 in. of the sizes recommended by the vehicle manufacturer. The Maine Motor Vehicle Inspection Manual already requires a vehicle to fail inspection if a tire contacts any part of the body of the vehicle. This bill provides that a vehicle must still comply with applicable frame-height requirements that vary according to gross vehicle weight rating. Because tire size will affect frame height, frame-height limits can already effectively regulate against inappropriate tire size.

Maryland License Plates: Legislation has been introduced in Maryland to require the issuance of only a single license plate for motor vehicles. The bill, favored by state hobbyists, requires that the single registration plate be attached on the front of tractors and on the rear of all other vehicles. For vehicles required to display two registration plates, a second bill provides that the front plate may be stored inside the vehicle if the vehicle was manufactured without a means to secure and display a front plate.

Missouri License Plates: Legislation has been introduced in Missouri to require the issuance of only a single license plate for motor vehicles. The bill also applies to personalized plates. If enacted into law, the measure would allow vehicle owners to obtain a second plate under limited circumstances (e.g., certain property-carrying commercial motor-vehicle applicants can request two plates). Among other things, the measure would save money, conserve resources and bring Missouri in line with other states that have moved to a single-plate requirement.

Montana Year-of-Manufacture Plates: Legislation to allow the owner of a motor vehicle, trailer, semitrailer or pole trailer manufactured in the year 1948, 1949 or 1950 to display a single original Montana license plate that is affixed to the rear of the vehicle was approved by the House of Representatives. Under the bill, the original Montana license plate must be legible and must bear the year that matches the year in which the vehicle was manufactured. The Montana Senate will next consider the bill.

Montana Inoperable Vehicles: Legislation to provide a limit on the number of inoperable motor vehicles allowed to accumulate on private property under “community decay” laws has been introduced in Montana. Under the bill, more than three “junk vehicles” on private property would constitute community decay. In Montana, a “junk vehicle” means a motor vehicle, including component parts, that is discarded, ruined, wrecked or dismantled; is not lawfully and validly licensed; and that remains inoperative or incapable of being driven. Even vehicles that are permanently registered but meet these criteria are considered junk vehicles. The bill establishes no provisions that would enable vehicles located out of public view to avoid being classified as junk.

Nebraska Headlamps: SEMA is contesting legislation introduced in Nebraska to require headlamps to be “clear or of a white color” without further requiring that they comply with U.S. Department of Transportation (DOT) standards regarding lighting equipment. Under the DOT standard, it is possible to design a headlamp that emits a light that is perceived as having a blue tint but which nevertheless remains within the boundaries that define “white.”

New York Wheels: SEMA is again opposing legislation to require vehicle identification numbers (VIN) on the wheels of motor vehicles assembled or sold in New York. All wheels sold in the United States generally comply with industry standards, which include markings with the wheel manufacturer’s name, trademark or symbol, date of manufacture and manufacturer’s part number or code. Wheels are already identifiable without imposing a VIN-marking burden. Both Congress and the National Highway Traffic Safety Administration (NHTSA) have determined that wheel markings of the type contemplated by this bill would impose a huge burden on the wheel makers, automakers and dealers. In addition, as noted, wheels already have distinguishable markings.

New York Historic Vehicles: SEMA-supported legislation has been reintroduced in New York to provide that historical-vehicle owners pay only a one-time registration fee of $100 upon initial registration. The bill was approved by the full Senate last session but died in the Assembly when the legislature adjourned for the year. Under New York law, a historical motor vehicle is either a vehicle manufactured more than 25 years ago or one which has unique characteristics and that is determined to be of historical, classic or exhibition value. The reduced registration fee would be available to owners of historical vehicles owned and operated as exhibition pieces or collectors’ items and used for club activities, exhibits, tours, parades, occasional transportation and similar uses. The $100 one-time fee would replace the current annual fee of $28.75.

Vermont Exhaust Systems: A bill to ban motor vehicle exhaust systems that increase noise levels has been reintroduced in Vermont. Under the bill, violators would not pass the state’s required inspection and would be subject to fines. The measure does not provide an opportunity for vehicle hobbyists to install and use exhaust systems that meet an objective decibel limit under a fair and predictable test and would make it difficult for hobbyists to replace factory exhaust systems with more durable, better-performing options.

Virginia Restoration Projects: Legislation containing a SEMA amendment to totally exempt from the license tax vehicles and parts cars stored on private property for the purpose of restoration or repair was approved by the House of Delegates. The license tax is applied to vehicles that do not display current license plates. Under the bill, vehicles stored within a structure would remain exempt from the tax. The Virginia Senate will next consider the bill.

Virginia License Plates: Pressured by opposition from the state’s law enforcement community, Virginia legislation to reduce from two to one the number of license plates furnished by the DMV to registered motor vehicles was pulled from consideration by the bill’s sponsor. Under the bill, the DMV would have required the single plate to be attached to the rear of the vehicle. The bill was stricken by a unanimous vote of the Senate Transportation Committee and is unlikely to return this session.

Washington Inoperable Vehicles: A version of SEMA-model legislation to prohibit cities or towns from enforcing an ordinance, development regulation, zoning regulation or administrative practice that prevents automobile collectors from pursuing their hobby was approved by the Senate Governmental Operations Committee and Rules Committee. Under the bill, junked, wrecked or inoperable vehicles stored on private property would require only screening from public view. Six or fewer vehicles that are 30 years old or older, including one parts car, would be permitted for hobby-vehicle restoration as long as restoration is an ancillary use of the property. The full Washington Senate will next hear the bill.

Wyoming Registration Fees: SEMA-opposed legislation to increase annual vehicle registration fees by $10 for passenger vehicles and double registration fees for non-commercial trucks died in the Wyoming House of Representatives. Under the bill, non-commercial trucks subject to the doubled registration fees would have included personal pickup trucks. Also, the measure made no special exception for antiques, custom vehicles or street rods that constitute a small portion of the vehicle fleet, are infrequently operated and are deserving of lower registration fees.

FEDERAL UPDATE

Johnson Valley OHV Area: An estimated 60,000 enthusiasts and participants attended the seventh annual “King of the Hammers” in early February. It is the largest off-roading event held at the Johnson Valley California OHV Recreation Area. SEMA is working with the Off-Road Business Association and a coalition of other land-use advocacy organizations to ensure that the land remains open to organized and individual off-highway vehicle (OHV) pursuits. The Marine Corps wants to expand its base at Twentynine Palms to include ownership of nearly 147,000 acres of adjacent land in Johnson Valley in order to conduct large-scale training exercises for one or two months a year. The OHV community is urging the Marines to obtain special-use permits from the U.S. Bureau of Land Management, which owns the land. The OHV community petitioned the White House for support of the special-use permit approach. More than 25,000 signatures required for an official administration response were received in just two weeks. The community is now awaiting a White House response. The Marines are required to submit a study to Congress by April 2, 2013 on how they might share the land with the OHV community.

E15 Ethanol: A federal appeals court dismissed on technicalities a lawsuit that challenged the Environmental Protection Agency’s (EPA) authority to permit the sale of 15% ethanol (E15) content in gasoline for ’01 and newer model-year cars and light trucks. The case may be appealed to the U.S. Supreme Court. SEMA continues to oppose the sale of E15 gasoline. Many older cars were not constructed with materials to counteract ethanol’s ability to absorb water and cause corrosion. E15 can also burn hotter than E10 gasoline and cause damage to certain high-performance specialty parts. The EPA has approved the sale of E15 for use in ’01 and newer vehicles while making it illegal to fuel older cars, motorcycles and other motorized equipment. However, the EPA is requiring only a gas-pump warning label instructing unsuspecting consumers that it is “illegal” to fill those products with E15. SEMA has joined with a number of other trade associations in seeking to enact legislation to repeal the E15 rule.

Minimum Sound Level for Electric Cars: The NHTSA has issued a proposed rule that will require hybrid and electric vehicles to make a minimum level of sound in order to alert pedestrians and bicyclists of their presence. The automakers would have a wide selection of choices when creating a sound. The sound would need to be detectable over a range of street noises when the vehicle is moving under 18 miles per hour. At 18 mph and above, the vehicle should produce sufficient sound on its own to be heard.

Home Office Deduction: The Internal Revenue Service has announced a simplified option for deducting the costs associated with having a home business office. The new optional approach is based on the amount of square feet being used for business purposes by the taxpayer. If it is 300 sq. ft. or less, the taxpayer can claim a deduction of $5 per square foot (up to $1,500 per year). The existing approach is to fill out Form 8829, which may require complex calculations of allocated expenses, depreciation and carryovers of unused deductions. Under the new option, taxpayers can still claim allowable mortgage interest, real estate taxes and casualty losses on the home as itemized deductions on Schedule A, but they cannot depreciate the portion of the home used for business. These deductions need not be allocated between personal and business use, as is required under the regular method. Current restrictions on the home office deduction, such as the requirement that a home office must be used regularly and exclusively for business, still apply under the new option, which is available starting with the 2013 tax return.

SEMA News—April 2013 

LEGISLATIVE AND TECHNICAL AFFAIRS
By Steve McDonald

Law and Order

STATE UPDATE

Arkansas Racing Facilities: SEMA is supporting Arkansas legislation to require the consent of only 38% of property owners and registered voters within three miles of a proposed motor-vehicle racing facility before construction of the facility can begin. Currently, construction requires the approval of 75% of property owners and voters.

California Legacy License Plates: Last year, legislation was enacted to establish the California Legacy License Plate Program. Under the new law, the DMV will create and issue a series of specialized license plates that replicate plates from the state’s past. The plates are now available for pre-order using a form available on the DMV website. The plates cost $50 for non-personalized or personalized plates. The law specifies that 7,500 applications must be received by January 1, 2015.

Colorado Emissions: Legislation has been introduced in Colorado to extend the emissions-inspection exemption to vehicles that have not yet reached their 10th model year. Current law exempts only vehicles that are four model years old or newer. The SEMA-supported bill would also exempt previously registered motor vehicles that have never failed an emissions-control inspection and create a senior citizen hardship exemption whereby a senior citizen may register one motor vehicle without obtaining an emissions inspection.

Connecticut Property Taxes: SEMA is opposing legislation to eliminate a provision in the Connecticut statutes that allows antiques, rare or special-interest motor vehicles to be assessed at a value of no more than $500. Under the bill, valuation of these vehicles will be done in the same manner as all other motor vehicles in the state. Vehicles in Connecticut are taxed by the municipality in which they are registered, and rates vary by municipality. The municipality calculates the owner’s tax liability for a particular vehicle by multiplying the “mill rate” by 70% of the vehicle’s true and actual value. Tax assessors are looking to target motor vehicles for additional revenue at a time when it appears that property taxes are increasing for many Connecticut citizens on other taxable property.

Maine Tire Size: Legislation has been introduced in Maine to remove a provision in the law that requires the overall diameter of motor vehicle tires be within 2 in. of the sizes recommended by the vehicle manufacturer. The Maine Motor Vehicle Inspection Manual already requires a vehicle to fail inspection if a tire contacts any part of the body of the vehicle. This bill provides that a vehicle must still comply with applicable frame-height requirements that vary according to gross vehicle weight rating. Because tire size will affect frame height, frame-height limits can already effectively regulate against inappropriate tire size.

Maryland License Plates: Legislation has been introduced in Maryland to require the issuance of only a single license plate for motor vehicles. The bill, favored by state hobbyists, requires that the single registration plate be attached on the front of tractors and on the rear of all other vehicles. For vehicles required to display two registration plates, a second bill provides that the front plate may be stored inside the vehicle if the vehicle was manufactured without a means to secure and display a front plate.

Missouri License Plates: Legislation has been introduced in Missouri to require the issuance of only a single license plate for motor vehicles. The bill also applies to personalized plates. If enacted into law, the measure would allow vehicle owners to obtain a second plate under limited circumstances (e.g., certain property-carrying commercial motor-vehicle applicants can request two plates). Among other things, the measure would save money, conserve resources and bring Missouri in line with other states that have moved to a single-plate requirement.

Montana Year-of-Manufacture Plates: Legislation to allow the owner of a motor vehicle, trailer, semitrailer or pole trailer manufactured in the year 1948, 1949 or 1950 to display a single original Montana license plate that is affixed to the rear of the vehicle was approved by the House of Representatives. Under the bill, the original Montana license plate must be legible and must bear the year that matches the year in which the vehicle was manufactured. The Montana Senate will next consider the bill.

Montana Inoperable Vehicles: Legislation to provide a limit on the number of inoperable motor vehicles allowed to accumulate on private property under “community decay” laws has been introduced in Montana. Under the bill, more than three “junk vehicles” on private property would constitute community decay. In Montana, a “junk vehicle” means a motor vehicle, including component parts, that is discarded, ruined, wrecked or dismantled; is not lawfully and validly licensed; and that remains inoperative or incapable of being driven. Even vehicles that are permanently registered but meet these criteria are considered junk vehicles. The bill establishes no provisions that would enable vehicles located out of public view to avoid being classified as junk.

Nebraska Headlamps: SEMA is contesting legislation introduced in Nebraska to require headlamps to be “clear or of a white color” without further requiring that they comply with U.S. Department of Transportation (DOT) standards regarding lighting equipment. Under the DOT standard, it is possible to design a headlamp that emits a light that is perceived as having a blue tint but which nevertheless remains within the boundaries that define “white.”

New York Wheels: SEMA is again opposing legislation to require vehicle identification numbers (VIN) on the wheels of motor vehicles assembled or sold in New York. All wheels sold in the United States generally comply with industry standards, which include markings with the wheel manufacturer’s name, trademark or symbol, date of manufacture and manufacturer’s part number or code. Wheels are already identifiable without imposing a VIN-marking burden. Both Congress and the National Highway Traffic Safety Administration (NHTSA) have determined that wheel markings of the type contemplated by this bill would impose a huge burden on the wheel makers, automakers and dealers. In addition, as noted, wheels already have distinguishable markings.

New York Historic Vehicles: SEMA-supported legislation has been reintroduced in New York to provide that historical-vehicle owners pay only a one-time registration fee of $100 upon initial registration. The bill was approved by the full Senate last session but died in the Assembly when the legislature adjourned for the year. Under New York law, a historical motor vehicle is either a vehicle manufactured more than 25 years ago or one which has unique characteristics and that is determined to be of historical, classic or exhibition value. The reduced registration fee would be available to owners of historical vehicles owned and operated as exhibition pieces or collectors’ items and used for club activities, exhibits, tours, parades, occasional transportation and similar uses. The $100 one-time fee would replace the current annual fee of $28.75.

Vermont Exhaust Systems: A bill to ban motor vehicle exhaust systems that increase noise levels has been reintroduced in Vermont. Under the bill, violators would not pass the state’s required inspection and would be subject to fines. The measure does not provide an opportunity for vehicle hobbyists to install and use exhaust systems that meet an objective decibel limit under a fair and predictable test and would make it difficult for hobbyists to replace factory exhaust systems with more durable, better-performing options.

Virginia Restoration Projects: Legislation containing a SEMA amendment to totally exempt from the license tax vehicles and parts cars stored on private property for the purpose of restoration or repair was approved by the House of Delegates. The license tax is applied to vehicles that do not display current license plates. Under the bill, vehicles stored within a structure would remain exempt from the tax. The Virginia Senate will next consider the bill.

Virginia License Plates: Pressured by opposition from the state’s law enforcement community, Virginia legislation to reduce from two to one the number of license plates furnished by the DMV to registered motor vehicles was pulled from consideration by the bill’s sponsor. Under the bill, the DMV would have required the single plate to be attached to the rear of the vehicle. The bill was stricken by a unanimous vote of the Senate Transportation Committee and is unlikely to return this session.

Washington Inoperable Vehicles: A version of SEMA-model legislation to prohibit cities or towns from enforcing an ordinance, development regulation, zoning regulation or administrative practice that prevents automobile collectors from pursuing their hobby was approved by the Senate Governmental Operations Committee and Rules Committee. Under the bill, junked, wrecked or inoperable vehicles stored on private property would require only screening from public view. Six or fewer vehicles that are 30 years old or older, including one parts car, would be permitted for hobby-vehicle restoration as long as restoration is an ancillary use of the property. The full Washington Senate will next hear the bill.

Wyoming Registration Fees: SEMA-opposed legislation to increase annual vehicle registration fees by $10 for passenger vehicles and double registration fees for non-commercial trucks died in the Wyoming House of Representatives. Under the bill, non-commercial trucks subject to the doubled registration fees would have included personal pickup trucks. Also, the measure made no special exception for antiques, custom vehicles or street rods that constitute a small portion of the vehicle fleet, are infrequently operated and are deserving of lower registration fees.

FEDERAL UPDATE

Johnson Valley OHV Area: An estimated 60,000 enthusiasts and participants attended the seventh annual “King of the Hammers” in early February. It is the largest off-roading event held at the Johnson Valley California OHV Recreation Area. SEMA is working with the Off-Road Business Association and a coalition of other land-use advocacy organizations to ensure that the land remains open to organized and individual off-highway vehicle (OHV) pursuits. The Marine Corps wants to expand its base at Twentynine Palms to include ownership of nearly 147,000 acres of adjacent land in Johnson Valley in order to conduct large-scale training exercises for one or two months a year. The OHV community is urging the Marines to obtain special-use permits from the U.S. Bureau of Land Management, which owns the land. The OHV community petitioned the White House for support of the special-use permit approach. More than 25,000 signatures required for an official administration response were received in just two weeks. The community is now awaiting a White House response. The Marines are required to submit a study to Congress by April 2, 2013 on how they might share the land with the OHV community.

E15 Ethanol: A federal appeals court dismissed on technicalities a lawsuit that challenged the Environmental Protection Agency’s (EPA) authority to permit the sale of 15% ethanol (E15) content in gasoline for ’01 and newer model-year cars and light trucks. The case may be appealed to the U.S. Supreme Court. SEMA continues to oppose the sale of E15 gasoline. Many older cars were not constructed with materials to counteract ethanol’s ability to absorb water and cause corrosion. E15 can also burn hotter than E10 gasoline and cause damage to certain high-performance specialty parts. The EPA has approved the sale of E15 for use in ’01 and newer vehicles while making it illegal to fuel older cars, motorcycles and other motorized equipment. However, the EPA is requiring only a gas-pump warning label instructing unsuspecting consumers that it is “illegal” to fill those products with E15. SEMA has joined with a number of other trade associations in seeking to enact legislation to repeal the E15 rule.

Minimum Sound Level for Electric Cars: The NHTSA has issued a proposed rule that will require hybrid and electric vehicles to make a minimum level of sound in order to alert pedestrians and bicyclists of their presence. The automakers would have a wide selection of choices when creating a sound. The sound would need to be detectable over a range of street noises when the vehicle is moving under 18 miles per hour. At 18 mph and above, the vehicle should produce sufficient sound on its own to be heard.

Home Office Deduction: The Internal Revenue Service has announced a simplified option for deducting the costs associated with having a home business office. The new optional approach is based on the amount of square feet being used for business purposes by the taxpayer. If it is 300 sq. ft. or less, the taxpayer can claim a deduction of $5 per square foot (up to $1,500 per year). The existing approach is to fill out Form 8829, which may require complex calculations of allocated expenses, depreciation and carryovers of unused deductions. Under the new option, taxpayers can still claim allowable mortgage interest, real estate taxes and casualty losses on the home as itemized deductions on Schedule A, but they cannot depreciate the portion of the home used for business. These deductions need not be allocated between personal and business use, as is required under the regular method. Current restrictions on the home office deduction, such as the requirement that a home office must be used regularly and exclusively for business, still apply under the new option, which is available starting with the 2013 tax return.

SEMA News—April 2013 

LEGISLATIVE AND TECHNICAL AFFAIRS
By Steve McDonald

Law and Order

STATE UPDATE

Arkansas Racing Facilities: SEMA is supporting Arkansas legislation to require the consent of only 38% of property owners and registered voters within three miles of a proposed motor-vehicle racing facility before construction of the facility can begin. Currently, construction requires the approval of 75% of property owners and voters.

California Legacy License Plates: Last year, legislation was enacted to establish the California Legacy License Plate Program. Under the new law, the DMV will create and issue a series of specialized license plates that replicate plates from the state’s past. The plates are now available for pre-order using a form available on the DMV website. The plates cost $50 for non-personalized or personalized plates. The law specifies that 7,500 applications must be received by January 1, 2015.

Colorado Emissions: Legislation has been introduced in Colorado to extend the emissions-inspection exemption to vehicles that have not yet reached their 10th model year. Current law exempts only vehicles that are four model years old or newer. The SEMA-supported bill would also exempt previously registered motor vehicles that have never failed an emissions-control inspection and create a senior citizen hardship exemption whereby a senior citizen may register one motor vehicle without obtaining an emissions inspection.

Connecticut Property Taxes: SEMA is opposing legislation to eliminate a provision in the Connecticut statutes that allows antiques, rare or special-interest motor vehicles to be assessed at a value of no more than $500. Under the bill, valuation of these vehicles will be done in the same manner as all other motor vehicles in the state. Vehicles in Connecticut are taxed by the municipality in which they are registered, and rates vary by municipality. The municipality calculates the owner’s tax liability for a particular vehicle by multiplying the “mill rate” by 70% of the vehicle’s true and actual value. Tax assessors are looking to target motor vehicles for additional revenue at a time when it appears that property taxes are increasing for many Connecticut citizens on other taxable property.

Maine Tire Size: Legislation has been introduced in Maine to remove a provision in the law that requires the overall diameter of motor vehicle tires be within 2 in. of the sizes recommended by the vehicle manufacturer. The Maine Motor Vehicle Inspection Manual already requires a vehicle to fail inspection if a tire contacts any part of the body of the vehicle. This bill provides that a vehicle must still comply with applicable frame-height requirements that vary according to gross vehicle weight rating. Because tire size will affect frame height, frame-height limits can already effectively regulate against inappropriate tire size.

Maryland License Plates: Legislation has been introduced in Maryland to require the issuance of only a single license plate for motor vehicles. The bill, favored by state hobbyists, requires that the single registration plate be attached on the front of tractors and on the rear of all other vehicles. For vehicles required to display two registration plates, a second bill provides that the front plate may be stored inside the vehicle if the vehicle was manufactured without a means to secure and display a front plate.

Missouri License Plates: Legislation has been introduced in Missouri to require the issuance of only a single license plate for motor vehicles. The bill also applies to personalized plates. If enacted into law, the measure would allow vehicle owners to obtain a second plate under limited circumstances (e.g., certain property-carrying commercial motor-vehicle applicants can request two plates). Among other things, the measure would save money, conserve resources and bring Missouri in line with other states that have moved to a single-plate requirement.

Montana Year-of-Manufacture Plates: Legislation to allow the owner of a motor vehicle, trailer, semitrailer or pole trailer manufactured in the year 1948, 1949 or 1950 to display a single original Montana license plate that is affixed to the rear of the vehicle was approved by the House of Representatives. Under the bill, the original Montana license plate must be legible and must bear the year that matches the year in which the vehicle was manufactured. The Montana Senate will next consider the bill.

Montana Inoperable Vehicles: Legislation to provide a limit on the number of inoperable motor vehicles allowed to accumulate on private property under “community decay” laws has been introduced in Montana. Under the bill, more than three “junk vehicles” on private property would constitute community decay. In Montana, a “junk vehicle” means a motor vehicle, including component parts, that is discarded, ruined, wrecked or dismantled; is not lawfully and validly licensed; and that remains inoperative or incapable of being driven. Even vehicles that are permanently registered but meet these criteria are considered junk vehicles. The bill establishes no provisions that would enable vehicles located out of public view to avoid being classified as junk.

Nebraska Headlamps: SEMA is contesting legislation introduced in Nebraska to require headlamps to be “clear or of a white color” without further requiring that they comply with U.S. Department of Transportation (DOT) standards regarding lighting equipment. Under the DOT standard, it is possible to design a headlamp that emits a light that is perceived as having a blue tint but which nevertheless remains within the boundaries that define “white.”

New York Wheels: SEMA is again opposing legislation to require vehicle identification numbers (VIN) on the wheels of motor vehicles assembled or sold in New York. All wheels sold in the United States generally comply with industry standards, which include markings with the wheel manufacturer’s name, trademark or symbol, date of manufacture and manufacturer’s part number or code. Wheels are already identifiable without imposing a VIN-marking burden. Both Congress and the National Highway Traffic Safety Administration (NHTSA) have determined that wheel markings of the type contemplated by this bill would impose a huge burden on the wheel makers, automakers and dealers. In addition, as noted, wheels already have distinguishable markings.

New York Historic Vehicles: SEMA-supported legislation has been reintroduced in New York to provide that historical-vehicle owners pay only a one-time registration fee of $100 upon initial registration. The bill was approved by the full Senate last session but died in the Assembly when the legislature adjourned for the year. Under New York law, a historical motor vehicle is either a vehicle manufactured more than 25 years ago or one which has unique characteristics and that is determined to be of historical, classic or exhibition value. The reduced registration fee would be available to owners of historical vehicles owned and operated as exhibition pieces or collectors’ items and used for club activities, exhibits, tours, parades, occasional transportation and similar uses. The $100 one-time fee would replace the current annual fee of $28.75.

Vermont Exhaust Systems: A bill to ban motor vehicle exhaust systems that increase noise levels has been reintroduced in Vermont. Under the bill, violators would not pass the state’s required inspection and would be subject to fines. The measure does not provide an opportunity for vehicle hobbyists to install and use exhaust systems that meet an objective decibel limit under a fair and predictable test and would make it difficult for hobbyists to replace factory exhaust systems with more durable, better-performing options.

Virginia Restoration Projects: Legislation containing a SEMA amendment to totally exempt from the license tax vehicles and parts cars stored on private property for the purpose of restoration or repair was approved by the House of Delegates. The license tax is applied to vehicles that do not display current license plates. Under the bill, vehicles stored within a structure would remain exempt from the tax. The Virginia Senate will next consider the bill.

Virginia License Plates: Pressured by opposition from the state’s law enforcement community, Virginia legislation to reduce from two to one the number of license plates furnished by the DMV to registered motor vehicles was pulled from consideration by the bill’s sponsor. Under the bill, the DMV would have required the single plate to be attached to the rear of the vehicle. The bill was stricken by a unanimous vote of the Senate Transportation Committee and is unlikely to return this session.

Washington Inoperable Vehicles: A version of SEMA-model legislation to prohibit cities or towns from enforcing an ordinance, development regulation, zoning regulation or administrative practice that prevents automobile collectors from pursuing their hobby was approved by the Senate Governmental Operations Committee and Rules Committee. Under the bill, junked, wrecked or inoperable vehicles stored on private property would require only screening from public view. Six or fewer vehicles that are 30 years old or older, including one parts car, would be permitted for hobby-vehicle restoration as long as restoration is an ancillary use of the property. The full Washington Senate will next hear the bill.

Wyoming Registration Fees: SEMA-opposed legislation to increase annual vehicle registration fees by $10 for passenger vehicles and double registration fees for non-commercial trucks died in the Wyoming House of Representatives. Under the bill, non-commercial trucks subject to the doubled registration fees would have included personal pickup trucks. Also, the measure made no special exception for antiques, custom vehicles or street rods that constitute a small portion of the vehicle fleet, are infrequently operated and are deserving of lower registration fees.

FEDERAL UPDATE

Johnson Valley OHV Area: An estimated 60,000 enthusiasts and participants attended the seventh annual “King of the Hammers” in early February. It is the largest off-roading event held at the Johnson Valley California OHV Recreation Area. SEMA is working with the Off-Road Business Association and a coalition of other land-use advocacy organizations to ensure that the land remains open to organized and individual off-highway vehicle (OHV) pursuits. The Marine Corps wants to expand its base at Twentynine Palms to include ownership of nearly 147,000 acres of adjacent land in Johnson Valley in order to conduct large-scale training exercises for one or two months a year. The OHV community is urging the Marines to obtain special-use permits from the U.S. Bureau of Land Management, which owns the land. The OHV community petitioned the White House for support of the special-use permit approach. More than 25,000 signatures required for an official administration response were received in just two weeks. The community is now awaiting a White House response. The Marines are required to submit a study to Congress by April 2, 2013 on how they might share the land with the OHV community.

E15 Ethanol: A federal appeals court dismissed on technicalities a lawsuit that challenged the Environmental Protection Agency’s (EPA) authority to permit the sale of 15% ethanol (E15) content in gasoline for ’01 and newer model-year cars and light trucks. The case may be appealed to the U.S. Supreme Court. SEMA continues to oppose the sale of E15 gasoline. Many older cars were not constructed with materials to counteract ethanol’s ability to absorb water and cause corrosion. E15 can also burn hotter than E10 gasoline and cause damage to certain high-performance specialty parts. The EPA has approved the sale of E15 for use in ’01 and newer vehicles while making it illegal to fuel older cars, motorcycles and other motorized equipment. However, the EPA is requiring only a gas-pump warning label instructing unsuspecting consumers that it is “illegal” to fill those products with E15. SEMA has joined with a number of other trade associations in seeking to enact legislation to repeal the E15 rule.

Minimum Sound Level for Electric Cars: The NHTSA has issued a proposed rule that will require hybrid and electric vehicles to make a minimum level of sound in order to alert pedestrians and bicyclists of their presence. The automakers would have a wide selection of choices when creating a sound. The sound would need to be detectable over a range of street noises when the vehicle is moving under 18 miles per hour. At 18 mph and above, the vehicle should produce sufficient sound on its own to be heard.

Home Office Deduction: The Internal Revenue Service has announced a simplified option for deducting the costs associated with having a home business office. The new optional approach is based on the amount of square feet being used for business purposes by the taxpayer. If it is 300 sq. ft. or less, the taxpayer can claim a deduction of $5 per square foot (up to $1,500 per year). The existing approach is to fill out Form 8829, which may require complex calculations of allocated expenses, depreciation and carryovers of unused deductions. Under the new option, taxpayers can still claim allowable mortgage interest, real estate taxes and casualty losses on the home as itemized deductions on Schedule A, but they cannot depreciate the portion of the home used for business. These deductions need not be allocated between personal and business use, as is required under the regular method. Current restrictions on the home office deduction, such as the requirement that a home office must be used regularly and exclusively for business, still apply under the new option, which is available starting with the 2013 tax return.

SEMA News—April 2013

HERITAGE

By Drew Hardin
Photo Courtesy Petersen Archive

Dick Scritchfield was a relatively new addition to the Car Craft magazine staff when he drew the assignment to cover the growing auto-stereo trend in the magazine’s January 1967 issue.

“If you haven’t already bolted a tape deck in that machine of yours, man, you’re either living outside of the ‘in’ group or have never heard an automotive stereo tape player in action,” he said in his opening paragraph. “Stereo might be great at home, but in a car—it’s something else. Just to drive along while listening to your favorite music coming at you from all directions is what most stereo owners refer to as the new surrounding sound.”

True surround sound, of the multi-speaker, mega-watt, AM/FM/CD/MP3/satellite/HD radio variety, is state-of-the-art in cars today. In 1967, Scritch was describing the birth of stereo in cars—a movement led by Ford in 1966—and the differences between four- and eight-track tapes.

“Bill Lear, manufacturer of the famous Lear Jet aircraft, set out with his engineers to design a cartridge and player that could handle eight sound tracks rather than only four,” Scritchfield wrote. That would allow a full one hour and 20 minutes of uninterrupted music. Ford’s choice of the eight-track player “started a feud akin to the early days of the 45 and 33 LP records. The four-track players had marketed more than 600,000 units when the eight-track Lear design was chosen as the Ford standard.”

Motorola stepped up to manufacture the Lear player in the quantities required by Ford, and “other members of the auto industry followed by offering eight-track players in their ’67 lines as optionals.”

In the opening photo for his guide, Scritchfield parked his iconic Ford roadster in front of a stereo store owned by actor Skip Young and his partner Bob Williams in Woodland Hills, California. To populate the photo, Scritchfield gathered several of the store’s employees around Young (at center in the photo), who, among other roles in the early days of television, played Wally in “The Adventures of Ozzie and Harriet.” Young is holding a Muntz Stereo-Pak, one of several four- and eight-track players marketed by Madman Muntz.

“By keeping the price under $100, Muntz has been able to move his stereo units with tremendous acceptance,” said Scritch.

Tremendous acceptance for the time, maybe. But while the four- and eight-track manufacturers were duking it out for market share, a little-known device called the audiocassette was slowly improving in fidelity. Once it matched the eight-track for music reproduction quality, those big, bulky eight-track cartridges would become instant relics—or collectibles, depending on your point of view.

SEMA News—April 2013

HERITAGE

By Drew Hardin
Photo Courtesy Petersen Archive

Dick Scritchfield was a relatively new addition to the Car Craft magazine staff when he drew the assignment to cover the growing auto-stereo trend in the magazine’s January 1967 issue.

“If you haven’t already bolted a tape deck in that machine of yours, man, you’re either living outside of the ‘in’ group or have never heard an automotive stereo tape player in action,” he said in his opening paragraph. “Stereo might be great at home, but in a car—it’s something else. Just to drive along while listening to your favorite music coming at you from all directions is what most stereo owners refer to as the new surrounding sound.”

True surround sound, of the multi-speaker, mega-watt, AM/FM/CD/MP3/satellite/HD radio variety, is state-of-the-art in cars today. In 1967, Scritch was describing the birth of stereo in cars—a movement led by Ford in 1966—and the differences between four- and eight-track tapes.

“Bill Lear, manufacturer of the famous Lear Jet aircraft, set out with his engineers to design a cartridge and player that could handle eight sound tracks rather than only four,” Scritchfield wrote. That would allow a full one hour and 20 minutes of uninterrupted music. Ford’s choice of the eight-track player “started a feud akin to the early days of the 45 and 33 LP records. The four-track players had marketed more than 600,000 units when the eight-track Lear design was chosen as the Ford standard.”

Motorola stepped up to manufacture the Lear player in the quantities required by Ford, and “other members of the auto industry followed by offering eight-track players in their ’67 lines as optionals.”

In the opening photo for his guide, Scritchfield parked his iconic Ford roadster in front of a stereo store owned by actor Skip Young and his partner Bob Williams in Woodland Hills, California. To populate the photo, Scritchfield gathered several of the store’s employees around Young (at center in the photo), who, among other roles in the early days of television, played Wally in “The Adventures of Ozzie and Harriet.” Young is holding a Muntz Stereo-Pak, one of several four- and eight-track players marketed by Madman Muntz.

“By keeping the price under $100, Muntz has been able to move his stereo units with tremendous acceptance,” said Scritch.

Tremendous acceptance for the time, maybe. But while the four- and eight-track manufacturers were duking it out for market share, a little-known device called the audiocassette was slowly improving in fidelity. Once it matched the eight-track for music reproduction quality, those big, bulky eight-track cartridges would become instant relics—or collectibles, depending on your point of view.