Law and Order

SEMA News—August 2014

LEGISLATIVE AND TECHNICAL AFFAIRS
By Steve McDonald

Law and Order

STATE UPDATE

Colorado Collector Cars: Governor John Hickenlooper signed into law legislation that originally repealed the six-year limitation for applying a salvage brand to a motor vehicle whose cost of being repaired exceeded its value. A SEMA-supported amendment to the bill protects from the salvage brand all vehicles that qualify at the time of damage as collector’s items, horseless carriages or street rods. The new law now protects collector cars from a permanent “salvage” blemish on the vehicles’ titles, which would have made them suspect even if the vehicles were expertly restored or modified.

Delaware Reconstructed Vehicles: SEMA-supported legislation to exempt reconstructed vehicles that are more than 25 years old from emissions testing was passed by the Delaware Senate and sent to the governor for his signature and enactment into law. The House of Representatives has already passed the measure. Under the bill, the vehicle must continue to meet and be inspected for safety and anti-tampering requirements for its model year. In Delaware, “reconstructed vehicle” means a “vehicle which has been assembled or constructed largely by means of essential parts, new or used, derived from other vehicles or makes of vehicles of various names, models and types, or which, if originally otherwise constructed, has been materially altered by the removal of essential parts or by the addition or substitution of essential parts, new or used, derived from other vehicles or makes of vehicles.”

Hawaii Exhaust Systems: Legislation that would have required official inspection stations to test vehicles to determine if their exhaust systems “emit noise noticeably greater than that emitted by the vehicle as equipped from the factory” died when the legislature adjourned for the year. The bill had not been given committee consideration. The bill unfairly provided no objective standard by which vehicles could be tested and did not provide inspection stations with decibel readings on factory-installed exhaust systems.

Louisiana Collector Cars: Legislation to annually designate the Friday, Saturday and Sunday of the second weekend in July as “Louisiana Collector Car Appreciation Weekend” was signed into law by Governor Bobby Jindal. Earlier this year, SEMA announced these dates to mark the fifth commemoration in what has become an annual event to raise awareness of the vital role automotive restoration and collection plays in American society. SEMA worked again to secure a U.S. Congressional resolution to recognize the event’s significance.

Minnesota Classic Cars: Legislation to provide for a program that will allow classic-car status to be determined from nationally recognized standards and guides was signed into law by Governor Mark Dayton. Under the current system, this status must be designated by the state through a time-consuming amendment to the law. A classic-car plate is available to “any motor vehicle manufactured between and including the years ’25 and ’48, and designated as a full classic car because of its fine design, high engineering standards, and superior workmanship, and owned and operated solely as a collector’s item....” The new law will speed up the process by which Minnesota vehicles can attain classic-car status.

Minnesota Miles Traveled Tax: Legislation that would have established a pilot program administered by the Department of Transportation to impose a vehicle mileage user fee died when the legislature adjourned for the year. The bill sought to penalize national efforts to create a more fuel-efficient vehicle fleet by taxing drivers based on vehicle mileage. As gas tax revenues decrease due to hybrid and electric vehicle ownership, states are looking for new sources of funding for pet projects.

Minnesota Lead Wheel Weights: As of January 1, 2016, it will be illegal to sell, distribute or install a wheel weight that contains lead or mercury in Minnesota. The law also requires proper recycling of lead- or mercury-based weights removed from vehicles. California, Illinois, New York, Maine, Vermont and Washington have already enacted laws banning the manufacture, sale and use of lead weights. The automakers no longer use lead weights as original equipment. Automakers, tire makers and the aftermarket are turning to three main substitute materials: steel, zinc or composites. At issue are environmental concerns that if lead weights fall off tires, they may be ground into fine dust particles and eventually contaminate surface and ground water supplies, among other issues.

New Hampshire Year-of-Manufacture Plates: A bill to expand the range of vehicles eligible to use original year-of-manufacture license plates on antique motor vehicles was approved by the New Hampshire Senate and now moves to the governor for her signature and enactment into law. The House of Representatives has already passed the measure. Currently, only ’60-and-earlier model-year antique vehicles are eligible to use these plates. Under the bill, eligibility would be expanded to include all ’75-and-earlier model years.

Vermont Exhaust Systems: A bill to ban motor-vehicle exhaust systems that increase noise levels died when the legislature adjourned for the year. Under the bill, violators would not have passed the state’s required inspection and would have been subject to fines of up to $350. The bill did not provide an opportunity for vehicle hobbyists to install and use aftermarket modified exhaust systems that meet an objective decibel limit under a fair and predictable test. Instead, the bill would have allowed inspectors to make subjective judgments on whether an exhaust system amplified the noise emitted by the motor vehicle.

Canada (Nova Scotia) Collector Cars: Thanks to the efforts of the National Association of Automobile Clubs of Canada, Nova Scotia Premier Stephen McNeil issued a proclamation designating July 2014 as “Automotive Heritage Month” in the province. Nova Scotia joins several states, provinces and cities that have officially recognized the celebration of collector cars.

FEDERAL UPDATE

Expired Tax Credits: The U.S. House of Representatives has approved a bill to permanently extend the research-and-development (R&D) credit. The U.S. Senate is considering a similar measure to renew the R&D credit for two years, along with other corporate tax measures that expired in 2013. Of interest to the business community, the SEMA-supported Senate bill would extend the 50% bonus depreciation for qualified property purchased before January 1, 2016. Section 179 expensing would also be restored for one more year at the maximum $500,000 deduction with a $2 million phase-out level. Absent the renewal, the allowance reverts to $25,000 with a $200,000 phase-out level. Action on the Senate bill has stalled over concerns that it does not identify revenue offsets to pay for the extenders.

Effectiveness of ESC Systems:The National Highway Traffic Safety Administration (NHTSA) published a technical report that evaluates the effectiveness of electronic stability control (ESC) systems in reducing crash-related fatalities involving light-duty vehicles weighing less than 10,000 lbs. ESC systems assist the driver by triggering computer-controlled braking of individual wheels when the system senses that there is a loss of vehicle control. The systems were required to be installed on all new light-duty vehicles by 2011. According to the NHTSA, ESC systems have helped reduce fatal rollovers by 60% in cars and 74% in light trucks and fatal single-vehicle crashes by 31% in cars and 45% in light trucks.

Early-Warning Reports: As of August 2014, manufacturers must submit all recall reports and associated documents electronically through an NHTSA website. In 2002, the NHTSA established an “early-warning” system for reporting information to the agency that could provide clues to potential future safety problems. Most of the direct reporting requirements are limited to large-volume vehicle manufacturers (more than 5,000 vehicles annually), large-volume tire manufacturers (more than 15,000 tires of the same size and design annually) and child-restraint system manufacturers. These companies must supply NHTSA with information about injuries, property damage, consumer complaints, warranty claims, field reports and production data every calendar quarter. Equipment manufacturers are not required to supply early-warning materials, but reporting is triggered under two circumstances: 1) an incident or allegation involving a death; 2) the company issues recall notices, advisories or customer-satisfaction campaigns referencing a defect, failure or malfunction, whether or not such defect is safety-related.

New Mexico National Monument: President Obama designated the Organ Mountains-Desert Peaks area in southern New Mexico as a National Monument. At nearly 500,000 acres, it is more than twice as big as the president’s previous largest designation, the 243,000-acre Rio Grande del Norte National Monument in northern New Mexico. While the action does not immediately close any roads, it prohibits new roads or trails for motorized vehicles. Under current law, the president has the authority to declare a parcel of public land with “historic or scientific interest” to be a National Monument. SEMA supports a bill passed by the U.S. House of Representatives that would guarantee participation by the public and Congress when making these declarations. The bill is pending consideration in the U.S. Senate.

OHV Use at Cape Lookout, North Carolina: The National Park Service (NPS) has issued a Draft Environmental Impact Statement for managing OHV activity at Cape Lookout National Seashore, North Carolina. The NPS is considering four alternatives for managing OHVs, along with a fifth alternative that prohibits OHV activity altogether. The plans include continuing current activities. The NPS supports an alternative to designate specific OHV routes and areas, establish a permit program that would maintain OHV use at historical levels, phase out high-performance sport-model and two-stroke ATVs and UTVs with seasonal use restrictions, and establish seasonal night-driving restrictions. Cape Lookout National Seashore forms the southern section of North Carolina’s Outer Banks. The NPS OHV management plan for Cape Hatteras, to the north, has already been the subject of legal challenges as being overly restrictive. SEMA has supported efforts in Congress to enact legislation reversing a 2012 management plan banning access to about 39% of the Cape Hatteras seashore and restricting access to another 19% of the area. The legislation is pending consideration in the U.S. Congress.

“National” OHV Recreation Area: The U.S. House of Representatives passed a SEMA-supported bill to include the word “National” within the title “Johnson Valley Off-Highway Vehicle Recreation Area.” Johnson Valley is the nation’s first federal off-highway vehicle (OHV) area, and the word addition will acknowledge the land’s national significance. The legislation follows last December’s success when Congress passed a law ending a six-year clash between the military and OHV users over access to thousands of acres of Southern California desert. More than 96,000 acres will continue to be maintained by the U.S. Bureau of Land Management as an OHV recreation area, with other lands being transferred to the adjoining Twentynine Palms Marine Corps base for military training needs.

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