FEDERAL LEGISLATIVE ACTIVITY

While the nation’s economy and gasoline prices still dominate the news, legislative activity on Capitol Hill slowed to a standstill while the Presidential election process reached full swing as both political parties held their National Conventions.

FEDERAL REGULATORY ACTIVITY

NIADA Submits Comments on Risk-Based Pricing

NIADA submitted comments in response to the Notice of Proposed Rulemaking issued by the Federal Trade Commission and the Board of Governors of the Federal Reserve System to implement the risk-based pricing provisions contained in Section 311 of the Fair and Accurate Credit Transactions Act of 2003.

NIADA thanked the agencies for their diligent effort to create a workable regulatory scheme within the confines of an exceedingly challenging statutory mandate.  NIADA believes, however, the regulatory scheme created incorrectly and unwisely applies the risk-based pricing notice requirements contained in Section 311 to persons, such as motor vehicle dealers involved in three-party financing, who do not engage in risk-based pricing.
 
NIADA said that should the agencies retain in the Final Rule a regulatory scheme that imposes the risk-based pricing requirements on dealers who do not engage in risk-based pricing, the agencies should retain the exception notices set forth in the Proposed Rule subject to modifications and clarifications set forth in the comments.  NIADA also asked the agencies to retain, subject to the same modifications and clarifications, the exception notices for dealers involved in two-party financing transactions who engage in risk-based pricing.

NHTSA Holds Hearing on CAFE and Climate Issues

It was something many thought would not happen, but witnesses testified at an August hearing on the importance of federal fuel economy standards to the environment.  Federal regulators have said in the past that the standards would have only modest effects and that a full analysis of their environmental impact was unnecessary.  But last year, the 9th U.S. Circuit Court of Appeals ruled that standards adopted for 2008-11 light trucks were fatally flawed.  The court said the National Highway Traffic Safety Administration had not fully analyzed environmental effects or assigned a value to the benefits of lower greenhouse gas emissions.  The ruling came too late to force changes in the 2008-11 standards, but moved NHTSA to prepare a draft environmental impact statement for its proposed 2011-15 standards.  Those in the motor vehicle industry saw the hearing on the draft environmental impact statement as an opportunity to reaffirm support for a single national standard rather than state-by-state rules.

STATE ACTIVITY

 California’s Bid to Limit Emissions Hits Court Snag

California's effort to limit vehicle emissions of gases that contribute to global warming hit a snag when a Federal Appeals Court ruled that the state and environmental groups acted too early when they sued the Bush Administration in January for blocking the law.  The Ninth U.S. Circuit Court of Appeals in San Francisco dismissed a lawsuit filed by California, 15 other states and five environmental groups over the Environmental Protection Agency's refusal to let the state enforce its limits on greenhouse gas fumes from new cars and trucks.  The court said the January 2nd suit was premature because the EPA, which had announced its intention to deny the state's request in a letter to Governor Arnold Schwarzenegger on December 19th hadn't yet acted formally.  The agency eventually took that step March 6th when EPA Administrator Stephen Johnson entered his decision in the Federal Register.  California and its allies then filed a new suit in a federal appeals court in Washington, D.C. That suit is still pending and is unaffected by the Court Order.

OTHER ACTIVITY OF INTEREST

NHTSA Estimates Put U.S. Auto Fleet at MPG Record

Our nation's cars and light trucks are expected to set a record for fuel efficiency for the 2008 model year, according to a recent report from the National Highway Traffic Safety Administration.  NHTSA said that the nation's fleet of passenger cars and light trucks averaged an estimated 26.8 mpg through March, up from 26.6 mpg for the entire 2007 model year.  Passenger cars were estimated to average a high of 31.2 mpg in the first half of 2008, unchanged from 2007, while light trucks were estimated to average 23.4 mpg, up from 23.0 mpg for 2007.

ISSUE OF THE MONTH

NIADA Assists Members with Red Flag Rule Compliance

As most within the automotive industry are aware, compliance with the FTC Red Flags Rule that affects creditors and financial institutions, including motor vehicle dealers, is mandatory by November 1, 2008.  The time is now to get your Dealership Compliance Program put in place.  To assist dealers with this effort, the NIADA has a free educational guide that explains dealer’s responsibilities under the new rule, in addition to providing a template that dealers can use to develop the required written Identity Theft Prevention Program.  NIADA members can obtain the materials from the NIADA or your State Association.