The presidential election is just a few months away and the balance of power in Congress and state capitols is up for grabs. Now is the time for the specialty automotive aftermarket to mobilize and make our voices heard. Although SEMA’s next Washington Rally will be in May 2021, it is still possible to meet your elected officials in their local districts this year. SEMA government affairs staff can help you forge a relationship with the men and women who make decisions that impact the industry by inviting an elected official to tour your business or arranging a community meeting with your lawmaker.
Wisconsin—Collector and Hobbyist Vehicles: SEMA-opposed legislation in Wisconsin to restrict eligibility and raise fees for collector and hobbyist vehicle registrations failed to pass the Assembly prior to a required legislative deadline. Currently, those vehicles must be more than 20 years old, and owners are required to pay twice the normal registration fee. If passed, the bill would have further limited each designation to vehicles 30 years old and older, expanded seasonal use restrictions, and increased the registration fees to three times the normal rate. In Wisconsin, a collector vehicle is defined as being at least 20 years old, preserved because of historical significance, and having had no body alterations. Vehicles eligible for hobbyist plates include street modifieds, replica vehicles, reconstructed vehicles and homemade vehicles.
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.