Bill Text: HI HB2522 | 2016 | Regular Session | Introduced

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Bill Title: Motor Vehicle Rentals; Pass On Fees

Spectrum: Partisan Bill (Democrat 10-0)

Status: (Introduced - Dead) 2016-02-01 - Referred to TRN, CPC, FIN, referral sheet 5 [HB2522 Detail]

Download: Hawaii-2016-HB2522-Introduced.html

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HOUSE OF REPRESENTATIVES	H.B. NO.	2522
TWENTY-EIGHTH LEGISLATURE, 2016
STATE OF HAWAII

A BILL FOR AN ACT

 

 

relating to motor vehicle rentals.

 

 

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

 

     SECTION 1.  The legislature finds that rental car companies are permitted by Hawaii law to recover certain mandatory government fees from rental car customers for the purpose of making a vehicle road-ready.  However, the present law establishes a formula for the recovery of these fees that results in a significant portion of the fees going unrecovered.  This is partially because rental cars are rented significantly less than one hundred per cent of the time, and because the present formula in the law allows only 1/365th of certain types of fees to be recovered.

     The legislature finds that this result is not consistent with the original intent of the law.  Other states, including California, have adopted laws that allow rental car companies to pass on to consumers an amount closer to the full recovery of mandatory government fees, while still preserving transparency for the consumer.  The legislature finds that it is appropriate for Hawaii to follow this model.

     The purpose of this Act is to change the methodology for the collection of vehicle license recovery fees by expanding the categories of fees that can be recovered, and requiring that the total fees charged do not exceed the annual fees actually paid by a rental car company in a particular year.

     SECTION 2.  Section 437D-8.4, Hawaii Revised Statutes, is amended by amending subsection (a) to read as follows:

     "(a)  Notwithstanding any law to the contrary, a lessor may visibly pass on to a lessee:

     (1)  The general excise tax attributable to the transaction;

     (2)  [The vehicle license and registration fee and weight taxes, prorated at 1/365th of the annual vehicle license and registration fee and weight taxes actually paid on the particular vehicle being rented for each full or partial twenty-four-hour rental day that the vehicle is rented; provided the total of all vehicle license and registration fees charged to all lessees shall not exceed the annual vehicle license and registration fee actually paid for the particular vehicle rented;] A vehicle license recovery fee, which includes vehicle license fees, beautification fees, initial plate fees, registration fees, weight taxes and use taxes; provided that the total vehicle license recovery fee charged to all lessees shall not exceed the annual vehicle license fees, beautification fees, initial plate fees, registration fees, weight taxes, and use taxes actually paid by the lessor in a particular year; and provided further that:

         (A)  If the total amount of the vehicle license recovery fees paid by lessees under this section in a particular year exceeds the total amount of the annual vehicle license fees, beautification fees, initial plate fees, registration fees, weight taxes, and use taxes actually paid by the lessor in a particular year, the lessor shall retain the excess amount and reduce the amount of vehicle license recovery fees charged to lessees for the following year by the corresponding amount; and

         (B)  The lessor submits to the office of consumer protection of the department of commerce and consumer affairs a statement, verified by a certified public accountant as correct, that reports the total amount of the annual vehicle license fees, beautification fees, initial plate fees, registration fees, weight taxes, and use taxes actually paid by the lessor in a particular year, and the total amount of vehicle license recovery fees charged to lessees;

     (3)  The surcharge taxes imposed in chapter 251 attributable to the transaction;

     (4)  The county surcharge on state tax under section 46-16.8; provided that the lessor itemizes the tax for the lessee; and

     (5)  The rents or fees paid to the department of transportation under concession contracts negotiated pursuant to chapter 102, service permits granted pursuant to title 19, Hawaii Administrative Rules, or rental motor vehicle customer facility charges established pursuant to section 261-7; provided that:

         (A)  The rents or fees are limited to amounts that can be attributed to the proceeds of the particular transaction;

         (B)  The rents or fees shall not exceed the lessor's net payments to the department of transportation made under concession contract or service permit;

         (C)  The lessor submits to the department of transportation and the department of commerce and consumer affairs a statement, verified by a certified public accountant as correct, that reports the amounts of the rents or fees paid to the department of transportation pursuant to the applicable concession contract or service permit:

              (i)  For all airport locations; and

             (ii)  For each airport location;

         (D)  The lessor submits to the department of transportation and the department of commerce and consumer affairs a statement, verified by a certified public accountant as correct, that reports the amounts charged to lessees:

              (i)  For all airport locations;

             (ii)  For each airport location; and

            (iii)  For each lessee;

         (E)  The lessor includes in these reports the methodology used to determine the amount of fees charged to each lessee; and

         (F)  The lessor submits the above information to the department of transportation and the department of commerce and consumer affairs within three months of the end of the preceding annual accounting period or contract year as determined by the applicable concession agreement or service permit.

          The respective departments, in their sole discretion, may extend the time to submit the statement required in this subsection.  If the director determines that an examination of the lessor's information is inappropriate under this subsection and the lessor fails to correct the matter within ninety days, the director may conduct an examination and charge a lessor an examination fee based upon the cost per hour per examiner for evaluating, investigating, and verifying compliance with this subsection, as well as additional amounts for travel, per diem, mileage, and other reasonable expenses incurred in connection with the examination, which shall relate solely to the requirements of this subsection, and which shall be billed by the departments as soon as feasible after the close of the examination.  The cost per hour shall be $40 or as may be established by rules adopted by the director.  The lessor shall pay the amounts billed within thirty days following the billing.  All moneys collected by the director shall be credited to the compliance resolution fund."

     SECTION 3.  Statutory material to be repealed is bracketed and stricken.  New statutory material is underscored.

     SECTION 4.  This Act shall take effect on January 1, 2018.  

 

INTRODUCED BY:	_____________________________

 

 

Report Title:

Motor Vehicle Rentals; Pass On Fees

 

Description:

Expands the base of the vehicle-related fees and taxes that motor vehicle lessors may pass on to lessees.

 

 

 

The summary description of legislation appearing on this page is for informational purposes only and is not legislation or evidence of legislative intent.