RPM Act: Congressional support for the Recognizing the Protection of Motorsports (RPM) Act, H.R. 5434/S. 2602, continues to grow. SEMA is working with lawmakers to pass the bill in 2020. There were 29 co-sponsors in the Senate and 58 co-sponsors in the House at press time for this issue of SEMA News. The bipartisan RPM Act protects the right to convert an automobile into a race car used exclusively at the track and to sell parts used to make the conversion and race the vehicle. SEMA asks its members to contact their lawmakers and urge their support. Visit www.sema.org/rpm.
Replica Cars: SEMA and many other companies and organizations submitted comments on a proposed rule issued by the National Highway Traffic Safety Administration (NHTSA) to implement the Low Volume Vehicle Manufacturers Act. The law allows small automakers to sell up to 325 turnkey replica vehicles that appear to have been produced at least 25 years ago. The 2015 law adopts the kit-car model, whereby the cars are regulated as equipment rather than current model-year vehicles. SEMA sued NHTSA in October 2019 for failure to issue a rulemaking within one year as required under the law. The agency responded to a court deadline by issuing the proposed rule. NHTSA is now reviewing public comments. Although there is no deadline, SEMA is urging NHTSA to issue a final rule by the summer of 2020 so that companies can begin producing and selling replica vehicles.
New Jersey—Vehicle Warranties: New Jersey Governor Phil Murphy signed into law legislation to require new-car dealers to provide purchasers written notice that it is illegal for manufacturers or dealers to void a warranty or deny coverage because aftermarket or recycled parts were installed or because someone other than the dealer performed service.
SEMA sued the National Highway Traffic Safety Administration (NHTSA) last October for failure to meet a 2016 deadline to issue a regulation to implement the replica car law. In December, NHTSA responded to a federal court of appeals deadline by issuing a proposed rule. SEMA and industry members have urged the agency to quickly finalize the rule, which will allow companies to produce and sell turnkey replica cars. Under the law, low-volume automakers may sell up to 325 cars each year that resemble production vehicles manufactured at least 25 years ago. The EPA and the California Air Resources Board have issued guidelines and regulations covering the engine packages to be installed in these replica vehicles.
The laws and regulations that govern how SEMA members do business have a continuous impact on the way automotive specialty-equipment products are made, distributed and marketed. The charge of the SEMA government affairs office is to stay on top of all relevant state and federal legislation and regulations and advocate for industry positions to ensure the best possible outcome for SEMA’s membership. The following are a few examples of critical legislative/regulatory issues addressed by the SEMA government affairs team over the past year.
The California Coastal Commission voted to make no changes to a permit that allows off-highway vehicle (OHV) use at the Oceano Dunes State Vehicular Area. The commission voted against a prohibition on night riding, additional fencing to restrict OHV use, eliminating unlimited OHV use on holidays, and increased enforcement efforts focused on vehicle use and speed limit. The commission also voted down a proposal to provide year-round protection to a 300-acre endangered species area (which is currently protected on a seasonal basis) and future closures for the purpose of dust control.
Delaware Governor John Carney signed into law a bill easing the process of registering a street rod by favorably changing the existing age and equipment requirements. The new law amends the definition of street rod from a vehicle manufactured before ’70 to one 25 years old or older. The law also removes the requirement that a street rod’s tires be covered by fenders.
Companies without any physical presence in a state can now be required to collect sales tax based on their sales volume. In June 2018, the U.S. Supreme Court ruled in favor of a South Dakota state law requiring remote sellers to collect sales tax. (The term “remote” applies to internet, catalog and telephone sales, along with other types of transactions.) The court overturned the 1992 Quill decision, which required a physical presence to create “substantial nexus,” thereby allowing state sales tax collections.
It’s the dawn of a new era at SEMA’s Political Action Committee (SEMA PAC). After more than a decade of exemplary service as the chairman of the industry’s legislative watchdog, PAC Chairman Doug Evans officially handed over the reins to John Hotchkis of Hotchkis Performance.
The U.S. Department of Commerce (DOC) sent President Trump the results of its investigation on whether imported automobiles and auto parts pose a threat to U.S. national security. A decision on whether to impose tariffs, originally due in May, was postponed until November. President Trump wanted to give U.S. negotiators six months to reach new trade agreements with the European Union and Japan.