In This Issue:
- FTC Moves on Red Flags and Used Car Rules - The 2013 VIP Auction Card - Michael W. Dunagan on Participation in the Legislative Process - Marketing Your Business
MARK OF SERVICE
We wear our commitment to dealers proudly on our sleeves. Count on the Dealer Avenue team for dedicated service at ADESA. Visit us online at ADESA.com/sell.
ÂŠ 2012 ADESA, INC.
Contact your nearest ADESA location:
ADESA Austin 512-873-4000 Sale day: Tuesday
972-225-6000 Sale day: Thursday
281-580-1800 Sale day: Wednesday
ADESA San Antonio 210-434-4999 Sale day: Thursday
“ What really impressed me was the level of service from your staff...
Pleasant, courteous... just wonderful to work with.”
“ My PWI rep did a wonderful job keeping me informed every step of the way
and eased all of my concerns with kindness and directness.” - Brian P.
“ I would never even entertain the notion of switching to another warranty company.” - Chris Dimitris
- Andy K.
Owner, Auto Discounters, Richmond, VA
West Keansburg, NJ
We take care of your customers so well you won’t hear from them again. (Until they buy their next car.)
Check out more customer and dealer comments at
2013 TIADA Board of Directors
CHAIRMAN OF THE BOARD Scott Allen/Auto Land 5925 E. Belknap Haltom City, TX 76117 Office: 817.834.4222 Email: firstname.lastname@example.org
SECRETARY Brent Rhodes/Fiesta Motors 5150 Industrial Way Drive Buda, TX 78610 Office: 512.312.2201 Email: email@example.com TREASURER HL Hensley/Automax of Lubbock P.O. Box 5627 Lubbock, TX 79452 Office: 806.744.3533 Email: firstname.lastname@example.org
J a n u a r y 2 013
PRESIDENT Byron Riley/Uncle Buddy’s PreOwned Autos, LTD. 409 North Loop West Houston, TX 77008 Office: 713.869.3405 Email: email@example.com
PRESIDENT ELECT Michael Thomasson/Mike Carlson Motor Company 264 Exchange St. Burleson, TX 76028 Office: 817.366.9578 Email: firstname.lastname@example.org
The Building Blocks of Attracting Customers
Six New Auctions Join the VIP Card for 2013
2013 Auto Auction Directory & Resource Guide
by Scott Allen, TIADA Chairman of the Board
by Barbara Wold
VICE PRESIDENT, WEST TEXAS (REGION 1) James Hobson/H-Town Motors 3714 Dyer Street El Paso TX 79930 Office: 915.564.9797 Email: email@example.com
14 On The Cover: All Hands On Deck – The 83rd Legislative Session is About to Convene
VICE PRESIDENT, FORT WORTH (REGION 2) Ahmed Belmeshkan/New Rio Grande Motors 2000 NE 28th Street Fort Worth, TX 76106 Office: 817.740.0801 Email: firstname.lastname@example.org
FTC Moves on Red Flags and Used Car Rules
From the Vault: A Landmark Legislative Victory
VICE PRESIDENT, HOUSTON (REGION 4) Ryan Winkelmann/BJ’s Autohaus 5005 Telephone Road Houston, TX 77087 Office: 713.641.0980 Email: email@example.com
Fines & Violations
VICE PRESIDENT, CENTRAL TEXAS (REGION 5) Sonny Paredez/Discount Auto Center 7203 NW Loop 410 San Antonio, TX 78245 Office: 210.680.5600 Email: firstname.lastname@example.org
Legal Corner: Participation in the Legislative Process
VICE PRESIDENT, DALLAS (REGION 3) Kathrine Tolsch/CICO Auto Sales 11050 Harry Hines Blvd. Dallas, TX 75229 Office: 214.352.9282 Email: email@example.com
VICE PRESIDENT, SOUTH TEXAS (REGION 6) Trey Crouch/Trey Crouch’s Wheels On Credit 636 E. Business 83 McAllen TX 78501 Office: 956.972.0700 Email: firstname.lastname@example.org VICE PRESIDENT AT LARGE Greg Zak/Dixon Motors 7902 North Freeway Houston, TX 77037 Office: 281.931.1300 Email: email@example.com VICE PRESIDENT AT LARGE Tommy Gregory/Abilene Used Cars Sales Inc. 497 E.S. 11th Abilene, TX 79602 Office: 325.676.8000 Email: firstname.lastname@example.org TIADA EXECUTIVE DIRECTOR Jeff Martin PO Box 127/Round Rock 78680 Office Hours M-F 8:30am - 4:30pm 800.442.5944 • Fax 512.244.6218 email@example.com
by Mario Martinez and Jeff Martin
compiled by Texas Dealer staff
by Texas Dealer staff
by Michael W. Dunagan
37 Regulation Matters: Out-of-State & Out-of-Country Sales
by Danny Langfield
Behind the Wheel by Jeff Martin
What’s happening at w w w . t x i a d a . c o m ? GO MOBILE! The TIADA website now features a mobile version which will automatically
be detected by your Android or iPhone browser. Check it out and let us know what you think… The Editor of the Texas Dealer magazine is Danny Langfield, Deputy Executive Director of TIADA. To change your address for subscription and/or for other TIADA products, call the TIADA state office at 800.442.5944, 512.244.6060 or fax 512.244.6218. E-mail: firstname.lastname@example.org. New Membership/Subscriptions: If you are a member of TIADA, you may receive this magazine free of charge. Membership year runs from Jan 1 to Dec 31. Back issues are available for $20 each subject to availability. Send a check or money order, along with your name and mailing address to TEXAS DEALER, Attn: Back Issues, P.O. Box 127, Round Rock, TX 78680-0127. Sorry, no billing. Notice to all members concerning services and products: TIADA was established in 1944 to develop professional standards of service and conduct for the independent auto industry. Opinions expressed herein are not necessarily those of the TIADA management, the Board of Directors or the membership. Likewise, the appearance of advertisers or their indemnifications of TIADA does not constitute endorsement of the products or services featured.
officers’ message Committee Sees Progress on Lien Holder Insurance Issues
uestion: “How do you eat an elephant?” You all probably know the answer: “One bite at a time.” This classic Q&A is an apt description of how to address lien holder problems with their customers’ insurance. From low-ball settlements to named-driver-only endorsements, the issues are difficult, complex and far-ranging. But that can’t be an excuse for inaction. With the help and involvement of the dealers of this association, I felt like TIADA could take a bite out of this elephant. In January of 2012, when I was TIADA president, I appointed an ad-hoc insurance committee to study these issues, prioritize them and provide recommendations to the board of directors. At their initial meeting, the dealers of this committee asked staff to develop a member survey to help identify the most prevalent issues and their relative significance to the industry. They also requested that staff contact state agencies and begin a dialogue on these issues with an eye toward solutions. The February issue of the Texas Dealer will include the results of the member survey, but I’d like to preview one specific survey question and response below: TIADA is working with the OCCC and TDI to determine whether you, as a lienholder, have the right to require your customers to obtain a policy that adequately protects your security interest in the vehicle. This would allow you to reject policies with a named-driver-only or excluded driver endorsement, among others. Please indicate how significant this would be to your dealership. 97% of respondents indicated that this would be either “significant” or “very significant” to their dealership. TIADA staff met with Commissioner Leslie Pettijohn and Rudy Aguilar, Director of Consumer Protection of the
Auto Land (Haltom City) TIADA CHAIRMAN OF THE BOARD
OCCC, to discuss this matter of what insurance a lien holder may require of his or her customer. The Commissioner and Mr. Aguilar understood the nature of the problem with limited policies and agreed that, to some extent, a lien holder had the right to require a policy that provided adequate protection of both the security interest and the customer. The Commissioner offered to have OCCC staff develop an advisory bulletin that would discuss what restrictions a lien holder may impose regarding an insurance policy. As announced in a TIADA Member Alert email, that bulletin has been drafted and published. It reads in part, “The purpose of 348.201 Texas Finance Code is to allow the holder to require insurance that provides adequate protection of the holder’s interest in the motor vehicle. Therefore, the OCCC will not object if a holder requires a buyer to obtain an insurance policy that contains certain terms that protect the holder’s interest.” The bulletin (available in its entirety at the OCCC website) goes on to provide examples of limited policy endorsements and other provisions that would allow a holder to reject those policies. Does this bulletin change the world? No – but it is a step in the right direction. When dealers get involved with their association, good things happen. The TIADA ad hoc insurance committee is planning to issue a full report in March discussing the findings of the member survey, the positions of state agencies and other stakeholders, and providing recommendations to TIADA’s dealer members. There is still a whole lot of elephant left to eat, but this is the only way to do it – one bite at a time.
When dealers get involved with their association, good things happen. January 2013
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feature The Building Blocks of Attracting Customers by Barbara Wold
International Speaker, Author and Business Strategist
hether you’re a Fortune 500 company or a one-person shop, to be successful, you must have a plan to attract customers and you must implement it consistently. However, it doesn’t have to cost a fortune and you don’t have to be a creative genius. The key to attracting customers is developing a marketing strategy that forms a solid foundation for your promotional efforts, by implementing advertising, direct mail, social media and one-to-one sales efforts.
To develop a strong marketing foundation Define Your Product or Service
How is your product or service packaged? What is it that your customers are really buying? Time is the ‘new’ currency. You may be selling quality used cars but your customers are buying a solution to their transportation needs. What problem does your product solve? What need does your product meet? What want does it fulfill?
Identify Your Ideal Customer
Everyone or Anybody might be a potential customer for your vehicles. However, you probably don’t have the time or money to market to Everyone or Anybody. Who is your ideal customer? Who does it make sense for you to spend your time and money promoting your product to? For example: an independent auto dealer could specifically target families looking for reliable transportation at an affordable price. That’s a different demographic than, say, an individual focused on a new vehicle just for him or herself. 6
Differentiate Yourself From the Competition
Something besides your product is competing for the potential customer’s money. What is it and why should the potential customer spend his or her money with you instead? What is your competitive advantage or unique selling proposition?
Find a Niche
Is there a customer group that is not currently being served or is not being served well? Are there customer wants that are not being met? A niche strategy allows you to focus your marketing efforts and dominate your market, even if you are a small player.
It is difficult for a potential customer to buy your product if they don’t even know or remember it exists. Generally a potential customer will have to be exposed to your product 5 to 15 times before they are likely to think of your product when the need arises. Needs often arise unexpectedly – like when their car breaks down. You must stay in front of your customers consistently if they are going to remember your product when that need arises.
Not only must customers be aware of your product, they also must have a positive disposition toward it. Potential customers must trust that you will deliver what you say you will. Often, T e x a s
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especially with large or risky purchases (like an automobile), you need to give them the opportunity to sample, touch, and experience the product in some way.
Be consistent in every way and in everything you do. This includes the look of your business, marketing materials, the message you deliver, the level of customer service, and the quality of the product. Being consistent is more important than having the best product. This in part is the reason for the success of chains. Whether you’re going to Little Rock, Arkansas or New York City, if you reserve a room at a Courtyard Marriott you know exactly what you’re going to get.
Focus allows for more effective utilization of the scarce resources of time and money. Your promotional budget will bring you greater return if you use it to promote a single product to a narrowly defined group of customers and if you promote that same product to that same customer group over a continuous period of time. Before you develop marketing materials, run an ad, implement a direct mail campaign, join a
networking group, start a Facebook page, add a Twitter or Pinterest account, ask yourself this question, Do I really know who my ideal customers are and not only what they need but also what they want?
Barbara Wold is a street-smart, down-to-earth business speaker, presenting topics from sales and marketing to customer experience and tourism. She is an international speaker who has “WOWED” over 850,000 people from all 50 of the United States, Puerto Rico, Guam, Canada, Colombia, Brazil, Venezuela, Singapore, Hong Kong, Philippines, Japan, Indonesia, China, Malaysia, India and the United Arab Emirates. Contact her at email@example.com.
Better Business Through Superior Customer Service!
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Manheim Manheim DFW Dallas Manheim Manheim El Paso San Antonio
Manheim Manheim Houston Texas Hobby San Antonio Austin
Six New Auctions Join the VIP Card Welcome to the 2013 incoming class! America’s Auto Auction Dallas America’s Auto Auction North Houston 1st Choice Auto Auction Houston
Alliance Auto Auction Abilene Alliance Auto Auction Longview Alliance Auto Auction Waco (formerly Midway Auto Auction)
America’s America’s AA Austin/ AA Dallas San Antonio America’s AA North Houston
Celebrating Six Straight Years on the Card
Alliance AA Longview Alliance AA Waco
Alliance AA Abilene
1st Choice AA Houston
Beaumont El Paso Dealers Independent AA Auction CM
USA AA Company Amarillo Auctions Heart of Texas Houston AA AA Waco Metro AA Dealers AA Austin of OKC
Special Thanks to Our Long-Time Supporters — With Us From the Beginning! Manheim Dallas Manheim DFW Manheim Houston Manheim Texas Hobby Manheim San Antonio Manheim El Paso Houston Auto Auction Texans Can! Cars Arlington
Insurance Auto Auctions Houston Insurance Auto Auctions Dallas Insurance Auto Auctions Austin Insurance Auto Auctions San Antonio Dealers Auto Auction of Oklahoma City USA Auto Auction Amarillo Heart of Texas Auto Auction Waco
Texas Lone1 Texans Star AA1 Can! Cars Carrollton1 Arlington
Big Valley Big Valley Corpus AA Christi Donna
Lubbock El Paso
San Antonio Houston
Permian Basin Dallas Houston North Longview
Austin Corpus Christi
What is the VIP Auction Card, Anyway? When you join the association or renew your membership, you will be sent the 2013 VIP Auction Card. It is a tri-fold card that fits in your wallet. When you buy or sell a vehicle at any of the participating auctions, present this card. Each auction will give you a FREE one-time buy or sell fee* (up to $200.) That’s it – be a TIADA member, save hundreds of dollars in inventory acquisition. That’s why we say renewing your TIADA membership should be a no-brainer!
TIADA introduced the VIP Auction Card in 2008, with 24 participating locations. Over the last six years, the card has grown to include 39 auctions, all across the state. A special thankyou to all the auctions over the years for supporting TIADA, our members and the industry with your generous participation .
2013 VIP Card pictured
12.244.6218 fax I w w w . t x i a d a . c o m 8
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TIADA Membership Application Business Name: ____________________________________________ Select one:
Contact Person: ____________________________________________ Address: __________________________________________________
2013 TIADA Membership Dues:
City: _________________________________________ State: _______
Zip: __________________ County: _____________________________
Jan. / Feb. / Mar.
Apr. / May / Jun.
Jul. / Aug. / Sep.
Oct. / Nov. / Dec.
E-mail address: _____________________________________________ Phone: _______________________ Fax: ________________________ Dealer P Number: ___________________________________________ Who referred you to TIADA? __________________________________ Mailing Address (if different from above): __________________________________________________________ City: _________________________ State: _______ Zip: ___________
(includes all of 2014) (all dues include NIADA membership)
PLEASE INDICATE PAYMENT METHOD: Check or Money Order payable to TIADA Check # __________ Credit Card Card Number: __________________________________________________ Expiration Date: ____________ Monthly Payments - $100 initial payment & $29.50 per month Via Credit Card (Please enter card information above. Authorization Agreement required - contact state office) Via Bank Draft (Authorization Agreement & voided check required - contact state office)
Mail or Fax Application To: TIADA Membership Services, P.O. Box 127 FAX 512.244.6218
Round Rock, TX 78680-0127 800.442.5944
Dues are not deductible as charitable contributions for income tax purposes but may be deductible as miscellaneous itemized deductions, subject to IRS restrictions. It is estimated that 20 percent of your dues dollars is used for lobbying activities and is therefore not deductible.
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Local Chapters VICTORIA Alan Wilkinson • AW Motors 361.570.2400 firstname.lastname@example.org Meeting - 1st Monday (Monthly) FORT WORTH Jerry Smith HJ Smith Automobiles 817.282.0102 email@example.com Meeting - 4th Thursday (Monthly) DALLAS COUNTY Kathrine Tolsch • CICO Auto Sales 214.352.9282 firstname.lastname@example.org Meetings every other month HOUSTON Greg Zak • Dixon Motors 281.931.1300 email@example.com Meeting - 2nd Monday (Monthly) WACO-HEART OF TEXAS Bill Miller • Bill Miller Used Cars 254.753.4161 firstname.lastname@example.org Meeting - 2nd Monday (Monthly) For more information contact Eddie Massey, Massey Motors 254.753.6661 SAN ANTONIO Sonny Paredez • Discount Auto Center 210.680.5600 email@example.com Meetings every other month (dates announced at www.txiada.com) EL PASO James Hobson • H -Town Motors 915.564.9797 firstname.lastname@example.org Meeting - 3rd Friday (Monthly) AUSTIN Brent Rhodes • Fiesta Motors 512.312.2201 email@example.com Meetings quarterly BEAUMONT Laura Sattler Sattler Automotive Group 409.866.2987 firstname.lastname@example.org Meetings announced at www.txiada.com 10
2 013 T I A D A a u t o a u c t i o n ABILENE
CM Company Auctions 2258 S. Treadaway / 79602 325.677.3555 866.310.3555 www.cmauctions.com Gregory Chittum, Owner Thursday: 10:00 AM
America’s Auto Auction Austin 16611 S. IH-35 / Buda / 78610 512.268.6600 www.americasautoauction.com John Swofford, General Manager Tuesday: 1:30 PM Metro Auto Auction 8605 Cullen Lane / 78748 512.282.7900 www.metroautoauction.com Dusty Rhodes, Owner Richard Saum, General Manager 3rd Saturday of month: 9 AM
Beaumont Dealers Auction, Inc. 12151 Highway 90 / 77713 409.866.5677 www.beaumontdealers.com Laura Miller-Sattler, Owner Tuesday: 7 PM Gulf Coast Auto Auction 4450 South 11th Street / 77701 409.840.6000 www.gulfcoastautoauction.com Roger Rashall, General Manager Rocky Rashall Blake Rashall Thursday: 7 PM
Texas Lone Star Auto Auction 2205 Country Club Drive / 75006 214.483.3597 www.TLSAA.com Jeff Dunning, Jr., General Manager Tim Clement, Assistant GM Michelle Elrod, Office Manager Tuesday: 1 PM / Thursday: 2 PM
Big Valley Auto Auction 5661 Agnes St / 78405 361.356.2020 www.bigvalleyaa.com Bernard Watson, Owner Billy Kratz, GM Tuesday: 10 AM Sparkling City Auto Auctions 4501 Hwy 77 / 78380 361.767.4100 www.sparklingcityaa.com Ace Walker, General Manager Rob Jackson, Operations Manager Ashley Dietze, Fleet Lease Friday: 10 AM
DALLAS / FT. WORTH METROPLEX
ADESA Dallas 3501 N. Lancaster-Hutchins Rd / Hutchins / 75141 972.225.6000 Ken Osborn, GM Wednesday: 3 PM - New Car Trade Thursday: 9:30 AM - Consignment/Fleet/ Lease America’s Auto Auction - Dallas 219 N. Loop 12 / Irving / 75061 972.445.1044 www.americasautoauction.com Robert Hammonds, GM Ruben Figueroa, Assistant GM. Tuesday: 2 PM / Thursday: 2 PM Manheim Dallas 5333 West Kiest Blvd. / 75236 214.330.1800 www.manheim.com/locations/dala Barry Roop, Market VP David Robertson, General Manager Laura Enterline, Customer Support Manager Nicole Graham, Market GSM Monday: 1 PM - TRA Tuesday: 9:30 AM - Consignment and FL Tuesday: 10 AM - Factory Chrysler (Alt Wks) Tuesday: 9 AM - Nissan monthly Wednesday: 8:45 AM - Fleet/Lease & Consignment Friday: 10 AM - “The” Dealer Trade Sale Manheim Dallas Fort Worth 12101 Trinity Blvd / Ft Worth / 76040 817.399.4000 www.manheim.com/locations/dfwa Barry Roop, Market VP Frank Post, General Manager Kelly McAlister, Customer Support Manager Nicole Graham, Market GSM Thursday: 9:30 AM - Featuring Ford Credit Thursday: 10 AM - Consignment & Fleet Lease Thursday: Exotic Highline Sales Monthly Judy Clark, Specialty Manager Friday: Specialty Sale in our state of the art heated and air-conditioned theatre. 2nd & 4th Friday: 9 AM - RV and Boat Sale 2nd Friday: 9 AM - Platinum RV sale 3rd Thursday: 12 PM - Medium to Heavy Duty Truck sale Remote sales: 3rd Monday at Automax Killeen, TX Remote sales: last Friday at Jerry’s Weatherford, TX
El Paso Independent Auto Auction 7930 Artcraft Road / 79932 915.587.6700 www.epiaa.com Lori Pidgeon, GM JD Glover, AGM Wednesday: 10 AM - Fleet/Lease & Dealer Consignment Wednesday: 1 PM as scheduled GSA Public Auction T e x a s
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directory & resource guide Manheim El Paso 485 Coates Drive / 79932 915.833.9333 www.manheim.com Michael Meyer, GM Thursday: 10 AM - Consignment Sale
HARLINGEN / MCALLEN
Big Valley Auto Auction 4315 N. Hutto Rd. / Donna / 78537 956.461.9000 www.bigvalleyaa.com Bernard Watson, GM Lisa Harms, alternate contact Thursdays: 10 AM
America’s Auto Auction – North Houston 1440 FM 3083 / Conroe / 77301 936.441.2882 www.americasautoauction.com Buddy Cheney, GM Ben Nash, Sales Manager Mondays: 6:30 PM Houston Auto Auction 6767 North Freeway / 77076 713.644.5566 www.houstonaa.com Dave Pratt, Vice President Joe Lavigne, General Manager Dealer Auction every Tuesday Tuesday: 12 PM - Damaged and Disabled Tuesday: 1 PM - Dealer Auction Last Tuesday of the month: 12 PM Heavy Truck and Equipment Manheim Houston 14450 West Road / 77041 800.444.2444 www.manheim.com/locations/bigh Barry Roop, Market VP Steve Green, General Manager Amanda Doyle, Customer Support Manager Nicole Graham, Market GSM Tuesday: 8:15 AM - TRA Sale Tuesday: 9 AM - Consignment Sale Manheim Texas Hobby 8215 Kopman / 77061 713.649.8233 www.manheim.com/locations/thaa Barry Roop, Market VP Steve Green, General Manager Debra Kunkle, Customer Support Manager Nicole Graham, Market GSM Every other Wednesday: 10 AM Ford Factory Sale Thursday: 8:15 AM - TRA Sale Thursday: 9 AM - Consignment Sale January 2013
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Lone Star Auto Auction 2706 Slaton Hwy / 79404 806.745.6606 (local) 888.299.6606 (toll-free) www.lsaalubbock.com Jim McNulty, Owner Dale Martin, General Manager Wednesday: 10 AM
Lufkin Dealers Auto Auction 2109 N. John Redditt Drive / 75904 936.632.4299 Wayne Cook Thursday: 6 PM
Lakeside Auto Auction 1810 East I-30 / 75087 972.771.9919 www.lakesideaa.com Pete Conley, Owner Tuesday: 7:00 PM
Alliance Auto Auction 15735 N. IH-35 (exit 346) / 76715 254.829.0123 254.829.1298 (fax) www.allianceautoauction.com Darren Darnell, GM email@example.com Carmen Klaus, Office Manager Every Friday: 10 AM
OKLAHOMA CITY, OK
Dealers Auto Auction of OKC 1028 S. Portland / Oklahoma City, OK / 73108 405.947.2886 405.943.8370 (fax) www.daaokc.com Gary Smith, Owner/President/GM John Reininger, Asst. GM Mike Egdahl, F/L Manager Thursdays: 8:30 AM - Consignment Sale INOP Sale held weekly GSA sale held monthly (open to public) Call for info on sale dates and times Every other Tuesday: 10:00 AM - GM Sponsored Factory Sale
Manheim San Antonio 2042 Ackermann Road / 78219 210.661.4200 Barry Roop, Markey VP Eddie Piatnik, General Manager Rod Garcia, Customer Support Manager Nicole Graham, Market GSM Wednesday: 9 AM Every other Friday: 9 AM Sparkling City San Antonio 13510 Topperwein / 78233 210.298.5477 www.sparklingcityaa.com Ashley Walker Deitze, GM Weldon Deitze, Ops Manager Tuesday, 11 AM
The TIADA Website: www.txiada.com Members can log in with their username/ password and access our Dealer Member Directory, Legislative Action Center, Legal Consultation Service and much more. Register for all upcoming TIADA events online at the Calendar of Events; access our online membership application; find contact information for all our Local Chapters, and find many additional resources at our Links page.
Texas Department of Motor Vehicles 888.368.4689 / www.txdmv.gov
Greater Tyler Auto Auction 11654 State Highway 64 W / 75704 903.597.2800 Tuesday: 5 PM - Repo Lane Tuesday: 6 PM - Consignment
Heart of Texas Auto Auction (Waco’s oldest auto auction- Proudly serving dealers for 20 years!) 2508 HWY 6 / 76705 254.755.7713 www.heartoftexasautoauction.com Allan Wichkoski, Owner Kenny Reigert, General Manager Shirley McMillan, Office Manager Thursday: 7 PM
Office of Consumer Credit Commissioner 800.538.1579 / www.occc.state.tx.us Texas Comptroller 800.252.1382 / www.window.state.tx.us NIADA 800.682.3837 / www.niada.com Repossessions American Recovery Association 972.755.4755 / www.repo.org or contact TIADA state office Forms: Burrell Printing / 800.252.9154 www.burrellprinting.com 11
Ignorance is no defense.
Know the law. Be proactive and protect yourself and your business from crippling fines. Attorney Michael W. Dunagan is the author of the two must-have books for every Buy-Here, Pay-Here dealer in Texas. Mr. Dunagan has been General Counsel toTIADA for over three decades and has represented hundreds of clients including car dealers, banks, finance companies, auto auctions and credit unions. He is a nationally known automobile industry compliance expert who has been published in dozens of trade journals and law reviews.
Dealer Financing of Used Car Sales
Texas Automobile Repossession: A Lien Holder’s Legal Guide
This comprehensive book covers all aspects of the complicated world of sellerfinancing in Texas, including Licensing and Regulation, State Sales Tax & Vehicle Inventory Tax, Retail Installment Contracts and much, much more.
Everything you need to know to stay on the right side of the law is addressed in this book, including When Repossession is Authorized, Post-Repossession Procedures, Private Sale vs. Strict Foreclosure, Bankruptcy, Post-Disposition Accounting and more. Includes forms for Cure Letter, 10 Day Letter, 20 Day Letter, and Calculation of Surplus or Deficiency.
TIADA Member Price: $125
TIADA Member Price: $125
Now available for purchase online at www.txiada.com under “Legal Resources” or call 800.442.5944 to order by phone.
When ordering online, login with your TIADA username and password to receive the discounted rate. All prices include shipping. Orders are shipped in 3-5 business days.
on the cover
All Hands on Deck the 83rd Legislative Session is about to Convene
ou are probably receiving the print version of this magazine very near the time the legislative session is gaveling in (January 8). As it gets underway, the first week is mostly ceremonial with families gathering to support and congratulate the swearing-in of the new members to the Texas House and Senate. Rules and Procedures for House and Senate will also be debated and adopted. In the House, there will be an additional task of electing the Speaker for the 83rd Legislative Session. All indicators at this time point to the re-election of Joe Straus as Speaker. As many of you know, the Texas House of Representatives has 150 members. The incoming freshman class in the House this year will consist of 44 new members; combine that with 23 freshman members from last session, and you have almost 45% of the house that has never served or only served one term. This presents a special challenge for us to make sure these new faces are aware of TIADA, what we stand for and how we can help them. We will continue that orientation process by hosting a special luncheon for the freshmen House members in January. Representative Larry Phillips, R-Sherman, is currently Chair of the House Transportation Committee and is expected to retain his seat. TIADA’s representatives and members are establishing a respectful working relationship with the Chair and his committee. In the Senate there will be five new incoming Senators. Senator Robert Nichols, R-Jacksonville, was recently appointed by Lt. Governor Dewhurst as the new chair of the Senate Transportation Committee. Representatives of TIADA and our dealer members have met with him on numerous occasions and are excited about the opportunities to work with him and his office. With the upcoming session just underway, it is once again important to point out that our most precious assets are our very own local dealer members. It is extremely beneficial when local connections are made with your own legislators, right there in their home district. And, as TIADA State Secretary Brent Rhodes wrote in the Officers’ Message in
Martinez & Associates TIADA LEGISLATIVE CONSULTANT
the November issue of this magazine, “These legislators are normal people just like me. Most of them run businesses, are married with kids, and have normal lives, just like I do.” I would join Mr. Rhodes in strongly encouraging you to get to know your legislators. Additionally, when these contacts are made locally, it would be helpful to provide any pertinent information to the state association office. Finally, please mark your calendar for Tuesday, January 29, 2013, for TIADA’s Lobby Day at the Capitol. Over the last few months, TIADA representatives and dealers have been meeting with legislators all across the state. Lobby Day will provide an excellent opportunity to visit with your legislative delegation and their staff at the Capitol and follow up on those district meetings. So, tug on your boot straps and cinch up your belt - the 83rd Legislature is coming to town.
(L to R): Rep. Larry Gonzales, Marcia and Keith Hagler of Taylor Auto Credit, and Jeff Martin of TIADA.
(L to R): Gary Chaney and Jason Freeman of Chacon Autos, Rep. Larry Phillips, Jeff Martin of TIADA, Kathrine Tolsch of CICO Auto Sales, and Michael Thomasson of Mike Carlson Motor Company. T e x a s
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on the cover
How to Track
the Bills that Matter to Your Industry
eeping up with what’s going on during the legislative session is actually easy. As a member of TIADA, you have access to the Legislative Action Center on the TIADA website. There you will find important legislation TIADA is tracking throughout Texas’s 83rd Regular Session. TIADA has a team that reviews each bill filed; when a relevant bill is identified it will be posted on the site and denote TIADA’s position, “for,” “against,” or “monitoring.” As bills move through the legislative process, TIADA members will be notified and asked to contact their legislators if need be to support or oppose specific legislation.
One such bill that has already been filed is HB 159 pertaining to acceptable ID types for a Texas driver’s license. This piece of legislation could resolve some of the issues facing dealers and consumers in September 2013 when various forms of identification will no longer be acceptable to title vehicles. Currently, TIADA is monitoring the bill until we have an opportunity to visit with the bill’s author and better understand his intent.
by Jeff Maritin TIADA Executive Director
Most of TIADA’s work is done well before a bill is filed. Recently, the association had a chance to visit with TxDMV about issues they would like to see legislators tackle in 2013. One issue deals with charging a processing fee for registering vehicles. This could create some challenges and some opportunities for dealers. We will keep members informed and involved throughout the process to insure your voice is being heard.
Ear to the Ground
Oddly enough, most members never hear of some of the more threatening concerns we address. Because of our involvement with various interest groups and our connections throughout the industry we usually know when more menacing legislation is afoot. Recently we heard of a group looking to soften the fraudulent mechanic’s lien legislation that TIADA members passed in 2009 that significantly reduced the misuse of mechanic’s liens. Knowing this threat is out there has allowed us to get in front of this issue, educate legislators and coordinate allies. However, stopping it may depend on your membership. We will keep you informed - you stay involved. Scott Allen of Auto Land (L) with Rep. Joe Straus at the 2012 TIADA Annual Conference
(L to R): Jason Freeman and Gary Chaney of Chacon Autos, Sen. Robert Nichols, Jeff Martin of TIADA, Michael Thomasson of Mike Carlson Motor Company.
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feature FTC Moves on Red Flags and Used Car Rules Compiled by Texas Dealer staff
he following press release was issued by the Federal Trade Commission (FTC) on November 30, 2012. The amended rule described below provides that dealers who neither pull credit nor report to the credit agencies will no longer be covered by the Red Flags Rule.
FTC Issues Amended Rule on Identity Theft “Red Flags”
Interim Final Rule Narrows the Circumstances Under Which Creditors Are Covered The Federal Trade Commission has announced publication of an Interim Final Rule on identity theft “red flags” that narrows the circumstances under which creditors are covered by the Rule. Congress directed the FTC, along with several banking agencies to develop regulations requiring “financial institutions” and “creditors” to develop and implement a written identity theft prevention program. By identifying “red flags” for identity theft in advance, businesses can be better equipped to spot suspicious patterns that may arise — and take steps to prevent potential problems from escalating into a costly episode of identity theft. Under the Rule, Red Flag Programs must have four parts. First, the Program must include reasonable policies and procedures to identify signs — or “red flags” — of identity theft in the day-to-day operations of the business. Second, the Program must be designed to detect the red flags of identity theft identified by the business. Third, the Program must set out the actions the business will take upon detecting red flags. Finally, because identity theft is an ever-changing threat, a business must re-evaluate its Program periodically to reflect new risks from this crime. The agencies promulgated the Red Flags Rule in 2007. In December 2010, Congress enacted legislation narrowing the definition of “creditors” covered by the Rule. The amended Red Flags Rule now provides that a creditor is covered only if, in the ordinary course of business, it regularly: Obtains or uses consumer reports in connection with a credit transaction; Furnishes information to consumer reporting agencies in connection with a credit transaction; or Advances funds to or on behalf of a person, in certain cases. The Commission is seeking comment on the Interim Final Rule for 60 days. After the expiration of the 60-day 16
comment period and a review of the comments received, the Interim Final Rule will become final. The Commission vote approving issuance of the Federal Register notice announcing the Interim Final Rule was 5-0. The notice will be published in the Register shortly and can be found on the FTC’s Web site as a link to this press release. The following press release was issued by the FTC on December 4, 2012.
FTC Proposes Modifications to Used Car Rule
The Used Car Rule, formally known as the Used Motor Vehicle Trade Regulation Rule, has been in effect since 1985 and requires car dealers to display a window sticker, known as a Buyers Guide, on the used cars they offer for sale. The Buyers Guide discloses whether the dealer offers a warranty and, if so, its terms and conditions, including the duration of the coverage, the percentage of total repair costs the dealer will pay, and which vehicle systems the warranty covers. In states that do not permit sales of used cars “as is,” or without warranties, dealers must display an alternative version of the Buyers Guide. The FTC has sought public comment on the Used Car Rule, and based on a review of the comments, has concluded that the Rule continues to benefit consumers and will be retained. The Commission is now seeking comments on potential revisions to the Rule that would empower consumers without adding burdens to businesses, including by: adding a statement to the Buyers Guide encouraging consumers to seek vehicle history information and directing consumers to an FTC website for more information about vehicle histories; adding a statement in Spanish to the Buyers Guide directing Spanish-speaking consumers to ask for a copy in Spanish, if they desire; adding catalytic converters and airbags to the List of Systems on the back of the Buyers Guide; and placing boxes on the back of the Buyers Guide where dealers will have the option to indicate whether (1) the manufacturer’s warranty still applies; (2) the manufacturer’s used vehicle warranty, such as a manufacturer’s certified used car warranty, applies; or (3) some other used vehicle warranty applies. (cont’d on pg. 25) T e x a s
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RED ITOR SELL ER/C : ADD RESS ZIP: CITY, ST,
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feature From The Vault by Texas Dealer staff
s we begin another legislative session, the Texas Dealer takes a look back at a landmark legislative victory achieved during the 80th legislature in 2007. Senate Bill 1617, initiated by TIADA, authored by Sen. Chris Harris and sponsored by Rep. Ken Paxton, allowed a seller-finance dealer to transfer a vehicle to a qualifying related finance company (RFC) without accelerating and paying the tax. The following letter was received by TIADA from the office of State Comptroller Susan Combs and appeared in the December 2007 issue of the Texas Dealer. October 31, 2007 Mr. Jeff Martin Executive Director Texas Independent Automobile Dealers Association Post Office Box 127 Round Rock, Texas 78680-0127 Dear Mr. Martin: Thank you for meeting with us concerning related finance companies (RFC) and Senate Bill 1617. I appreciate your willingness to work with this office to get clarification on the tax treatment of RFC notes both before and after the change in statute. If you would like, please forward the information in this letter to your members. Senate Bill 1617 was passed effective July 1, 2007. The legislation allows a seller-finance dealer to transfer a vehicle to a qualifying related finance company without accelerating and paying the tax. However, it only applies to qualifying transfers after a related finance company has registered with the Comptroller’s office and paid a $600 registration fee. When a related finance company becomes permitted, the Comptroller’s office will state that the taxpayer was registered beginning the first of the month in which payment and application were filed. This date is the most advantageous date that could be used. The applications are taken for whole years, so a taxpayer pays upfront for the year and receives notice a month or so prior to the renewal date. The new law only applies to transfers when the taxpayer is registered. As of Oct. 23, 2007 only 51 related finance companies have registered. The Comptroller’s office is urging
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industry to comply with these new guidelines and to register as soon as possible. We do not want to deter registration efforts in any way. To that end, no registration data will be used by audit division to select accounts for audit.
Responsibility for Taxes Collected After Transfer to RFC
Senate Bill 1617 only addressed the issue of acceleration of tax, without speaking to tax collection responsibilities. Under the change, the dealer, as the seller, retains the responsibility for the collection and payment of the tax. There is no reason to require separate reporting of motor vehicle taxes by the related finance company. Since these RFCs are normally 100 percent owned by the same entity (statutory requirement of at least 80 percent), this has not been seen as a problem. If a buyer can show payments either to registered dealer or registered RFC, we will include either in extinguishing their tax responsibility.
Audits for Periods Before and After Legislation
The legislation is prospective only. Our office is making the following special accommodations when auditing dealers for periods prior to the legislation. 1. Penalty will be waived on all taxes due regarding related finance companies (prior audit history, late returns, and other factors will not void the penalty waiver for these assessments) 2. No accelerations will be made on vehicles that continue to be reported on the dealer’s seller-finance returns as of the end of the audit period. If scheduled, these transactions would result in serious timing differences and large amounts of penalties and interest. 3. Repossessions. A dealer may continue to report the sales on the seller-finance return but the vehicle is repossessed during the audit period. In these cases, the difference between the sales tax due at transfer and the sales taxes reported will be scheduled in the filing period of repossession. Once again, although the correct date for the taxpayer to report under the statute was the date of transfer to the RFC, using the later date saves the taxpayer penalties and interest. 21
4. The statute period is normally 4 years from the due date of a tax and can be longer due to other considerations. However, audit assessments will not be made due to a transfer or assignment of title to a firm meeting the definition of a related finance company prior to Oct. 1, 2005. The taxpayer must provide the auditor with all information necessary to make the allowances in points two and three. Failure to provide adequate documentation will result in an auditor scheduling total figures as of the date of transfer to the RFC. The taxpayer must provide full cooperation and make the records available to show all transfers to RFCs and all taxes reported per vehicle on the seller-finance reports. For audit periods after July 1, 2007 where the RFC was not properly registered: acceleration will occur strictly upon transfer to the RFC, credit will still be allowed for taxes reported on subsequent seller-finance returns for the accelerated vehicles, and any penalty or interest waivers will be made strictly in accordance with our general procedures.
I hope this information is helpful to you and your members and once again I would like to thank you for your help and patience in dealing with this difficult issue. Please know that we stand ready to assist you in any way possible. Should you have additional questions, please call me at 512/463-4260 or our Assistant Director of Tax Administration, Kevin Koller, at 512/475-0613. Sincerely, Mike Reissig Associate Deputy Comptroller cc: The Honorable Patricia Harless, State Representative, District 126 The Honorable Ken Paxton, State Representative, District 70 Kevin Koller
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Upcoming Events OTHER TIADA EVENTS
TIADA DEALER ACADEMY January 2013 7 Solving the BHPH Puzzle
& Repossessions: What You Need to Know DoubleTree Dallas Market Center 2015 Market Center Blvd. / Dallas, TX 75207 214.741.7481 Online registration available at www.txiada.com
February 2013 11 Dealer 101: Nobody Told Me That!
DoubleTree by Hilton San Antonio Airport 37 NE Loop 410 (at McCullough) San Antonio, TX 78216 210.366.2424 Online registration available at www.txiada.com
March 2013 25 Keeping Your Dealership
Legal & Compliant DoubleTree by Hilton San Antonio Airport 37 NE Loop 410 (at McCullough) San Antonio, TX 78216 210.366.2424 Online registration available at www.txiada.com
April 2013 15 Solving the BHPH Puzzle
29 Dealer 101: Nobody Told Me That!
Crowne Plaza - Houston Northwest 12801 Northwest Frwy / Houston, TX 77040 713.462.9977 Online registration available at www.txiada.com
May 2013 6 Keeping Your Dealership
Legal & Compliant Norris Conference Center / Sundance Square 304 Houston Street / Fort Worth, TX 76102 817.289.2400 Online registration available at www.txiada.com
June 2013 17 Dealer 101: Nobody Told Me That!
DoubleTree Dallas Market Center 2015 Market Center Blvd. / Dallas, TX 75207 214.741.7481 Online registration available at www.txiada.com
January 2013 28 TIADA Board of Directors Meeting Austin, TX
29 TIADA Lobby Day at the Capitol Prefunction: The Driskill Hotel 604 Brazos Stree / Austin, TX 78701 512.474.5911
April 2013 22 TIADA Board of Directors Meeting Austin, TX
July 2013 21-24 TIADA Annual
Conference & Expo Hyatt Hill Country Resort & Spa 9800 Hyatt Resort Drive San Antonio, TX 78251 210.647.1234
21 TIADA Board of Directors Meeting San Antonio, TX (In conjunction with the Annual Conference & Expo)
23 TIADA House of Delegates Meeting San Antonio, TX (In conjunction with the Annual Conference & Expo)
& Repossessions: What You Need to Know Crowne Plaza - Houston Northwest 12801 Northwest Frwy / Houston, TX 77040 713.462.9977 Online registration available at www.txiada.com
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FTC Moves on Red Flags and Used Car Rules (cont’d from pg. 16)
The proposed Buyers Guide also makes some minor changes to improve readability. The Commission also invites comments on topics such as the nature and prevalence of deception in Internet used car sales and information the Commission should make available on a new website. To help protect consumers from potential post-purchase problems, both the proposed Buyers Guide and the current Buyers Guide recommend that consumers ask about an independent mechanic’s inspection before purchase, provide information about warranties, list a vehicle’s major systems and the major defects that may occur in them, and warn consumers that they should get all promises in writing because spoken promises are difficult to enforce. The Buyers Guide disclosures are incorporated by reference into the sales contract, and govern in the event of an inconsistency between the Buyers Guide and the contract. In addition to the proposed changes to the Rule, the FTC is also announcing a new final Rule that makes minor corrections to the Spanish translation of the Buyers Guide. The Used Car Rule requires dealers to use Spanish-language versions of the Buyers Guide and to make related contract disclosures in Spanish when they conduct sales in Spanish. The revised Spanishlanguage versions will take effect on February 11, 2013, but dealers may use up any remaining supplies of the current Buyers Guide. The revised Spanish translations can be found on the FTC’s website at business.ftc.gov.
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Please Welcome Our Newest TIADA Members NEW DEALER MEMBERS Auto Center of Texas Chris Knox 1615 W Moore Ave Terrell, TX 75160 Chubbys Auto Center Sidney Guajardo 3802 Culebra San Antonio, TX 78228 Countryside Auto Sales Gary Shockey 12019 San Pedro San Antonio, TX 78216 Doyle Chapman Motor Sales Doyle Chapman 6000 Cameron Road Austin, TX 78723 Emanuel Motor Company, Inc. Joe Arambula P.O. Box 2516 Laredo, TX 78044 Emanuel the Auto Store Juan Chavez 2106 South Meadow Ave Laredo, TX 78046 Five Star Autoplex Harmit Chattha 5456 E. Lancaster Ave Ft. Worth, TX 76112 Houston Auto Broker Mark Fischrupp 5613 Star Ln. Houston , TX 77057 J T L Sales & Service Jerry Heddin 1025 W. 6th Ave Amarillo, TX 79101 Lonestar Brokers Sam Karnes 125 Indian Hill Blvd Livingston, TX 77351 MHD Auto Sales LLC Mohamad Dandachli 902 Prarrie Trail Austin, TX 78758
Rev Share Auto Sales Steve Pace 1600 East Hwy 290 Dripping Springs, TX 78620
M.S.S. Auto Sales Rick White 5265 Beechnut St Houston, TX 77096
Texas Auto Net Mike West 16122 Wild Grove Court Tomball, TX 77377
Mi Patria Auto Sales, Inc. Vicente Estrada 5306 Airline Drive Houston, TX 77022
Texas City Auto Brokers, Inc. Myron Carnes 2828 Palmer Hwy Texas City, TX 77590
Reliable Auto Sales Diane King 502-B E. Veterans Memorial Blvd. Killeen, TX 76541
The Dealership Victoria Michelle Montgomery 5111 Greenville Ave. 600578 Dallas, TX 75360
Rosa’s Auto Sales, Inc Claudia Guzman 408 SSgt. Macario Garcia Houston, TX 77011
Vaughan Specialty Automobiles Ann Vaughan Lax P.O. Box 200 Alvarado, TX 76009
Southwest Auto Finance, Inc. Dean Morrow 5255 E Hunter Ave Anaheim, CA 92807
4M Autoplex Robert Miers 28 Glen Abbey Abilene, TX 79606 A Class Motors Rinat Farkhoutdinov 1140 Luke Street Irving, TX 75061 All City Auto Sales, Inc Hamid Mashriqi 811 Moss Glen Trail Arlington, TX 76002
Terry’s Used Cars Terry Jacks 1355 N. 11th Street Beaumont, TX 77702 Texas Autoplex, Inc Jennetter Foster 3100 NE 28th St Fort Worth, TX 76111 Unlimited Auto Sales Hamid Vatankhah 2200 W. Front Street Midland, TX 79701 NEW ASSOCIATE MEMBERS
CJD Motors Christopher Diaz 2537 West Kings Hwy San Antonio, TX 78228
Motorvation Earl Williams 278 Howard St Atlanta, GA 30317
Ferris Motor Trend Samir Juma 2034 W. Main St Grand Prairie, TX 75050
Nowcom Corporation Robert Lekstrom 4751 Wilshire Ave., Suite 115 Los Angeles, CA 90010
Hallelujah Motors, LLC Jerry Lyons 920 S. Frazier Conroe, TX 77301
Repo Systems.com, Inc Rob Lovelace 9400 N. MacArthur Suite 124 PMB 409 Irving, TX 75063
My New Used Cars Jonathan Graves 867 S. Mill St Lewisville, TX 75057
Lone Star Auto Brokers Tim Carter 3217 N Chadbourne St Suite B San Angelo, TX 76903
Pronto Car Credit Juan Jose Chavez 2106 South Meadow Ave Laredo, TX 78046
Lone Star Auto Sales Danessa Leal 6724-A Sherman St Houston, TX 77011 25
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fines& violations 12-0972 ENF Wade A. Delk / David M. Spina DBA Patriot Motor Company Misuse of buyer temporary E-tag. Failure to maintain complete records by licensed dealer or auction. Sold or offered to sell a motor vehicle at an unlicensed location. Failure to timely transfer title and pay sales tax. $1,000.00 and attend a Dealer Training Seminar. 12-0981 ENF First Continental Distributing Inc. DBA Consignment Cars Failure to remove Texas plates. Misuse of Internet-Down buyer temporary. $500.00 and attend a Dealer Training Seminar. 12-0988 ENF Jamie M. Booth, DBA Booth Motor Co. Failure to maintain complete records by licensed dealer or auction. Sold a motor vehicle without certificate of title or title receipt. $500.00 and attend a Dealer Training Seminar. 12-0990 John M. Lade, DBA Lade Sales Failure to remove Texas plates. Failure to maintain complete records by licensed dealer or auction. $500.00 and attend a Dealer Training Seminar. 12-1002 ENF Freshway Autos, Inc., DBA Best Way Autos Sold a motor vehicle without certificate of title or title receipt. Failure to timely transfer title and pay sales tax. $250.00 and attend a Dealer Training Seminar. 12-1023 ENF Alberto Villanueva,DBA El Paso Truck Sales Failure to maintain complete records by licensed dealer or auction. Sold or offered to sell a motor vehicle at an unlicensed location. $500.00 and attend a Dealer Training Seminar. 12-1122 ENF Dora L. Villanueva, DBA S & S Truck Sales Failure to have dealer or a bona fide employee present during posted business hours. Failure to maintain complete records by licensed dealer or auction. Sold or offered to sell a motor vehicle at an unlicensed location. $500.00 and attend a Dealer Training Seminar. 12-1134 ENF Olma Enterprises Inc. DBA East West Auto Sales Misuse of temporary dealer tag or failed to comply with recordkeeping requirements. Misuse of buyer temporary E-tag. $500.00 and attend a Dealer Training Seminar. 12-1138 ENF Pro-Active Inc., DBA Pro-Active Auto Sales Failure to remove Texas plates. Failure to maintain complete records by licensed dealer or auction. Failure to timely transfer title and pay sales tax. Attend a Dealer Training Seminar. January 2013
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FINAL ORDERS for June and July 2012. Agreed orders represent a settlement of the case between the department and the licensee. In most cases there has been a finding that a law has been violated by the licensee.
12-1152 ENF Ricardo A. Zesati DBA Transportation Equipment Sales Failure to display buyer’s guide. Failure to remove Texas plates. $250.00 and attend a Dealer Training Seminar. 12-1160 ENF AOD Ventures, Inc., DBA Autos of Dallas Failure to timely transfer title and pay sales tax. Failure to allow purchaser to select county for registration. $250.00 and attend a Dealer Training Seminar. 12-1163 ENF Richard W. McDaniel DBA Diamond D Motor Company Misuse of buyer temporary E-tag. Failure to timely transfer title and pay sales tax. $500.00. 12-1165 ENF Fazenda, Inc., DBA Dream Cars Credit Sold a motor vehicle without certificate of title or title receipt. Misuse of buyer temporary E-tag. Failure to maintain complete records by licensed dealer or auction. Failure to allow purchaser to select county for registration. $1,500.00 and attend a Dealer Training Seminar. 12-1175 ENF Long Motors, Inc., DBA Long Motors Inc. Misuse of buyer temporary E-tag. Sold or offered to sell motor vehicles on consecutive Saturday and Sunday. Failure to timely transfer title and pay sales tax. Failure to allow purchaser to select county for registration. $1,000.00 and attend a Dealer Training Seminar. 12-1203 ENF New World Auto Imports of Austin Inc. DBA Capitol Kia Failure to allow purchaser to select county for registration. $500.00. 12-1207 ENF Sylvia R. Reyna, DBA Autos C & R Sold or offered to sell motor vehicles on consecutive Saturday and Sunday. $500.00 12-0652 ENF Jorge Gonzalez, DBA J & D Auto Sales Failure to display buyer’s guide. Failure to maintain complete records by licensed dealer or auction. $200.00. 12-1009 ENF RJ Auto Motors Inc., DBA RJ Auto Motors Inc. Failure to display buyer’s guide. Failure to remove Texas plates. Misuse of metal plates. $250.00. 12-1010 ENF Juan Gonzalez, DBA J. Gonzalez Motors Failure to display buyer’s guide. Failure to remove Texas plates. Failure to meet premises requirement(s). $250.00. 12-1017 ENF Victor Manuel Urrutia Garcia DBA Continental Auto Failure to display buyer’s guide. Failure to
maintain complete records by licensed dealer or auction. $200.00. 12-1050 ENF Abbie Cheu, DBA El Paso Cars Failure to display buyer’s guide. Misuse of temporary dealer tag(s). $200.00. 12-1061 ENF Milton F. Alfaro, DBA C & M Used Cars Failure to display buyer’s guide. Failure to meet premises requirement(s). $200.00. 12-1071 ENF Bruno Huizar, DBA Huizar Motors Failure to display buyer’s guide. Failure to maintain complete records by licensed dealer or auction. Misuse of metal plates. $300.00. 12-1079 ENF Flamingo Motors Inc., DBA Flamingo Motors Failure to remove Texas plates. $50.00. 12-1081 ENF Orodonez Associates Corporation DBA DeLa Siena Motors Failure to display buyer’s guide. Failure to remove Texas plates. $150.00. 12-1083 ENF Guillermo Munoz, DBA Best Deal Auto Sales Failure to display buyer’s guide. Failure to display license. No metal dealer plate record. $300.00. 12-1085 ENF Marshall Import Automotive LP DBA Marshall Scion, Marshall Toyota Failure to remove Texas plates. Failure to observe right of way. $150.00. 12-1088 ENF Patterson Motors of Marshall Inc. DBA Patterson Chrysler Dodge Jeep Failure to remove Texas plates. 50.00 12-1089 ENF Sharon Cornelius, DBA S & R Auto Sales Failure to remove Texas plates. $50.00 12-1090 ENF S & R RV Sales & Rentals LLC DBA S & R RV Sales & Rentals Failure to remove Texas plates. $50.00. 12-1091 ENF Fords Used Cars Inc. DBA Fords Used Cars Inc. Failure to remove Texas plates. Failure to produce records within (15) days. Failure to observe right of way. $250.00. 12-1094 ENF B & B Automotive Inc. DBA B & B Automotive Inc. Failure to display buyer’s guide. Failure to remove Texas plates. Failure to maintain complete records by licensed dealer or auction. $250.00. 27
fines& violations 12-1095 ENF Shirley Bosse, DBA Bosse’s Used Cars Failure to display buyer’s guide. Failure to remove Texas plates. Failure to maintain complete records by licensed dealer or auction. $250.00. 12-1096 ENF Jonathan D. McCain, DBA Patriot Auto Mart Failure to remove Texas plates. Failure to maintain complete records by licensed dealer or auction. $150.00. 12-1097 ENF Ron Ethridge, DBA R & D Motors Failure to display buyer’s guide. Failure to maintain complete records by licensed dealer or auction. $200.00. 12-1098 ENF Anac Corp, DBA Champion Auto Sales Failure to display buyer’s guide. Failure to remove Texas plates. Failure to maintain complete records by licensed dealer or auction. $250.00. 12-1099 ENF Autos Guerrero Corp., DBA Autos Guerrero Failure to display buyer’s guide. Misuse of temporary dealer tag(s). $200.00. 12-1100 ENF Javier Barrio, DBA Sunrise Auto Center Failure to display buyer’s guide. Failure to maintain complete records by licensed dealer or auction. Failure to comply with foreign dealer rule. $300.00. 12-1110 ENF Arlo James Stewart DBA Sunnyvale Auto Sales Failure to display buyer’s guide. Failure to maintain complete records by licensed
dealer or auction. Failure to meet premises requirement(s). $300.00. 12-1125 ENF Pegues Hurst Motor Co. DBA Pegues Hurst Motor Co. Failure to display buyer’s guide. $100.00. 12-1126 ENF Fernando’s Auto Sales LLC DBA Fernando’s Auto Sales LLC Failure to meet premises requirement(s). $100.00. 12-1141 ENF Richard Wade Dickinson, DBA Area Motors Failure to display buyer’s guide. Failure to maintain complete records by licensed dealer or auction. Failure to observe right of way. $300.00. 12-1143 ENF Cesar Zetuche, Carlos Aquirre DBA C & I Auto Sales Failure to display buyer’s guide. $100.00. 12-1144 ENF Frederico Aguillon, DBA Aguillon Auto Sales Failure to display buyer’s guide. Failure to remove Texas plates. Failure to maintain complete records by licensed dealer or auction. $250.00. 12-1154 ENF Barney L. Stagner, DBA Barney’s Auto Sales Failure to display buyer’s guide. $100.00. 12-1155 ENF Safeway Trading Inc., DBA Mario Used Cars Failure to display buyer’s guide. Failure to remove Texas plates. $150.00.
12-1156 ENF Big Sea Limited Partnership DBA Auto Town Sales Failure to display buyer’s guide. $100.00. 12-1167 ENF AMC Auto Inc., DBA Apple Motor Co. Failure to display buyer’s guide. Failure to remove Texas plates. $150.00. 12-1168 ENF Brenda Joyce Clayton, DBA Best Motor Co. Failure to display buyer’s guide. Failure to remove Texas plates. $150.00. 12-1169 ENF Daisy Salinas, DBA Salinas Auto Sales Failure to remove Texas plates. Failure to maintain complete records by licensed dealer or auction. $150.00. 12-1170 ENF Texas La Fiesta Auto Sales LLC DBA La Fiesta Auto Sales Failure to display buyer’s guide. Failure to maintain complete records by licensed dealer or auction. $200.00. 12-1171 ENF Ebrahim Moosavi, DBA Auto Mainland Failure to remove Texas plates. Failure to maintain complete records by licensed dealer or auction.$150.00. 12-1178 ENF Juan J. Ventora-Jr., Hector Ventura DBA Ventura Auto Sales #1 Failure to display buyer’s guide. Failure to remove Texas plates. $150.00.
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12-1179 ENF Jacobs Auto Sales, DBA Jacobs Auto Sales Failure to remove Texas plates. $50.00. 12-1180 ENF Finn’s Discount Auto Inc. DBA Finn’s Discount Auto Inc. Failure to remove Texas plates. $50.00. 12-1183 ENF Fidel Cortez DBA Cortez Auto Sales & Salvage Failure to display buyer’s guide. Failure to remove Texas plates. $150.00. 12-1185 ENF Nexgen Automotive LLC DBA Nexgen Automotive LLC Failure to display buyer’s guide. Failure to remove Texas plates. Failure to display license. $250.00. 12-1186 ENF Alfredo Garza Jr., DBA Garza Auto Sales Failure to display buyer’s guide. Failure to remove Texas plates. $150.00. 12-1187 ENF Raymond Doyle Thompson DBA B & K Used Cars Failure to remove Texas plates. $50.00. 12-1188 ENF Robert F. Sanchez, DBA Big Star Auto Center Failure to display buyer’s guide. Failure to remove Texas plates. Failure to observe right of way. $250.00. 12-1189 ENF Gilberto Rocha DBA Hasmar Performance and Auto Sales Failure to display buyer’s guide. Failure to observe right of way. $200.00. 12-1206 ENF Richard L. Malone DBA Bo’s Down the Road Motors Failure to display buyer’s guide. $100.00. 12-1213 ENF Abdol hamid Vatankhah DBA Unlimited Auto Sales Failure to display buyer’s guide. Failure to take assignment of title. $200.00. 12-1226 ENF Temple Mac Haik Dodge LTD DBA Mac Haik Dodge Failure to remove Texas plates. Failure to maintain complete records by licensed dealer or auction. $150.00. 12-1227 ENF Garlyn Shelton Inc. DBA Garlyn Shelton Volkswagon Failure to remove Texas plates. Failure to observe right of way. $150.00. 12-1240 ENF Hubbard Pre-Owned LTD DBA Hubbard Pre-Owned Failure to remove Texas plates. Failure to have written consignment agreement. $150.00. 12-1241 ENF Bertha E. Carrera, DBA Economy Auto Sales Failure to remove Texas plates. $50.00. January 2013
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12-1244 ENF Egar Zertuche, DBA Illusion Auto Sales Failure to display buyer’s guide. Failure to remove Texas plates. $150.00. 12-1247 ENF Lara Tex Corporation DBA Dickinson Auto Sales Failure to display buyer’s guide. $100.00. 12-1248 ENF Colbyco Motors LLC, DBA Colbyco Motors LLC Failure to remove Texas plates. Failure to maintain complete records by licensed dealer or auction. $150.00. 12-1255 ENF Ralph E. Langley DBA County Line Auto Sales Failure to display buyer’s guide. Failure to remove Texas plates. $150.00. 12-1257 ENF Vellejo’s Auto Sales, DBA Vellejo’s Auto Sales Failure to display buyer’s guide. Failure to maintain complete records by licensed dealer or auction. $200.00. 12-1281 ENF Mayra Rivera, DBA Easy Buy Auto Sales Failure to display buyer’s guide. Failure to remove Texas plates. Failure to observe right of way. $250.00. 12-1282 ENF Bonanza Auto Sales DBA LaFiesta East Motors Failure to display buyer’s guide. Failure to observe right of way. $200.00. 12-1283 ENF Ralph Fountain, DBA Turf Auto Sales Failure to display buyer’s guide. Failure to remove Texas plates. $150.00. 12-1288 ENF Emmanuel Barrera, DBA Barrera’s Used Cars Failure to display buyer’s guide. Failure to remove Texas plates. Failure to observe right of way. $150.00. 12-1289 ENF Josefina P. Alanis/Baltazar Alanis DBA Discount Motors Failure to display buyer’s guide. $100.00. 12-1291 ENF Victor Ramirez, DBA Magic Autoplex Failure to display buyer’s guide. $100.00. 12-1293 ENF Ramona Alfaro, DBA Monchis Auto Sales Failure to display buyer’s guide. $100.00. 12-1294 ENF Jose Luis Gonzalez, DBA Recio Auto Sales Failure to display buyer’s guide. $100.00. 12-1323 ENF Fredis A. Romero, DBA Fredy Car for Less Failure to display buyer’s guide. $100.00. 12-1326 ENF Mamoun Abu Halawex DBA Southwest Auto Sales Failure to display buyer’s guide. Failure to remove Texas plates. Failure to maintain complete records by licensed dealer or auction. $250.00. 29
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fines& violations 10-1056 ENF Vidal Palma, DBA VIPA Automotor Permitted the use of its GDN or the location for which the GDN was issued for the purpose of avoiding requirements. Failure to display buyer’s guide. Misuse of temporary dealer tag(s). Misuse of old style buyer temporary tag. Failure to maintain complete records by licensed dealer or auction. Sold or offered to sell a motor vehicle at an unlicensed location. Failure to allow purchaser to select county for registration. $1,500.00. 10-1231 ENF Marcial Salazar, DBA Auto Marc Sold or offered to sell motor vehicles on consecutive Saturday and Sunday: $250.00. 10-1786 ENF Precision Investments Inc. DBA Precision Investments Inc. Failure to display buyer’s guide. Failure to remove Texas plates. Failure to take assignment of title or MCO. Failure to timely pay lien on a motor vehicle traded in. $2,500.00. 11-0379 ENF Ray Neils Auto Sales Inc. DBA Ray Neils Auto Sales Inc. Misuse of buyer temporary E-tag. Failure to timely transfer title and pay sales tax. Attend a Dealer Training Seminar. 11-1077 ENF Tomas Baralta-Balcazar, DBA Star’s Motors Failure to meet premises requirement(s). Sold or offered to sell a motor vehicle at an unlicensed location. $500.00 and attend a Dealer Training Seminar. 11-1139 ENF Killer Motorsports LLC, DBA Killer Motorsports Failure to maintain complete records by licensed dealer or auction. Sold or offered to sell new motor vehicles without the appropriate license. $250.00. 11-1145 ENF Kermit Motor Company, Inc. DBA Kermit Motor Company, Inc. Failure to display buyer’s guide. Failure to remove Texas plates. $250.00. 11-1162 ENF Jorge I. Castillo, DBA Master Tune Up Failure to remove Texas plates. Failure to make dealership records available for inspection. $500.00 and attend a Dealer Training Seminar. 11-1212 ENF Cransh Motors Inc., DBA Quick Pick Auto Failure to timely transfer title and pay sales tax. Cease and desist. 11-1465 ENF Dale Vaughan, DBA Guaranteed Auto Sales Failed to attend a Dealer Training Seminar in compliance with a Final Order: $250.00. 12-0672 ENF Marvin Lemus, DBA Lemus Used Cars Failure to maintain complete records by licensed dealer or auction. Filed a false title and tax document. Failure to timely transfer title and pay sales tax. Sold a motor vehicle without certificate of title or title receipt. $2,500.00 and attend a Dealer Training Seminar. January 2013
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12-0730 ENF K.W. Ministries, Inc., DBA C.R.U.S.H. Auto Sales Failure to maintain complete records by licensed dealer or auction. Failure to timely transfer title and pay sales tax. Sold a motor vehicle without certificate of title or title receipt. $1,000.00 and attend a Dealer Training Seminar. 12-0745 ENF P & N Collins, LLC, DBA Pat Collins Auto Sales Failure to display buyer’s guide. Failure to remove Texas plates. Failure to make dealership records available for inspection. $500.00 and attend a Dealer Training Seminar. 12-0846 ENF Alma F. Quirl, DBA Graham St Motors Failure to comply with a Final Order. $500.00 and attend a Dealer Training Seminar.
12-1329 ENF Cleo Bay Imports, Inc. DBA Cleo Bay, Cleo Bay Honda, Cleo Bay Subaru, Cleo Bay Used Cars Failure to maintain complete records by licensed dealer or auction. Failure to timely transfer title and pay sales tax. $1,000.00. 12-1280 ENF Adriana Loya Martinez, DBA AS Motors Failure to display buyer’s guide. Failure to maintain complete records by licensed dealer or auction. $200.00. 12-1284 ENF Ali Rouhani / Alex Zarei, DBA Royal Auto Sales Failure to display buyer’s guide. $100.00. 12-1285 ENF Luxer Motors, DBA Luxer Motors Failure to display buyer’s guide. $100.00.
12-0959 ENF All Star Imports Inc., DBA Legend Kia Failure to allow purchaser to select county for registration. $500.00.
12-1287 ENF Jose Rosales, DBA J & A. Auto Sales Failure to display buyer’s guide. Failure to observe right of way. $200.00.
12-0997 ENF Raymundo Enrique Ramos DBA West Side Cars Misuse of buyer temporary E-tag. Failure to timely transfer title and pay sales tax. Failure to maintain complete records by licensed dealer or auction. $500.00 and attend a Dealer Training Seminar.
12-1290 ENF Maria M. Trevino, DBA Lion’s Auto Sales Failure to display buyer’s guide. $100.00.
12-0987 ENF Luxe RGV Auto Group LLC DBA Luxe RGV Auto Group LLC Sold or offered to sell salvage vehicles without the proper license. $1,000.00 and attend a Dealer Training Seminar.
12-1307 ENF Farah Farah, DBA Popular Motors Fleet Sales Failure to remove Texas plates. Failure to maintain complete records by licensed dealer or auction. $150.00.
12-1024 ENF Global Auto Motors, LLC DBA Global Motor Cars Sold a motor vehicle without certificate of title or title receipt. $250.00 and attend a Dealer Training Seminar. 12-1197 ENF Triad Motors LP, DBA Hovey Motorcars Failure to timely transfer title and pay sales tax. $500.00. 12-1211 ENF Robert R. Saxton, DBA City Motor Company Failure to remove Texas plates. Failure to maintain complete records by licensed dealer or auction. $1,000.00 and attend a Dealer Training Seminar. 12-1232 ENF Andres Baca, DBA Friendly Auto Sales Failure to display buyer’s guide. Failure to remove Texas plates. Misuse of buyer temporary E-tag. Failure to have dealer or a bona fide employee present during posted business hours. Failure to timely transfer title and pay sales tax. License is revoked. Oppose new or renewal for 2 years. 12-1277 ENF Cash Star Motors, Inc. DBA Cash Star Motors, Inc. Misuse of buyer temporary E-tag. Failure to timely transfer title and pay sales tax. $1,000.00 and attend a Dealer Training Seminar.
12-1295 ENF Alfredo Cepeda, DBA Cega Auto Sales Failure to display buyer’s guide. Failure to remove Texas plates. Failure to take assignment of title. $250.00.
12-1331 ENF Jose Rodriguez, DBA Rodriguez Auto Sales Failure to display buyer’s guide. Failure to remove Texas plates. $150.00. 12-1332 ENF Mutassem N. Elouri, DBA Nexar Motors Failure to display buyer’s guide. Failure to maintain complete records by licensed dealer or auction. $200.00. 12-1333 ENF July Susana Diaz DBA ACA Auto Motors Failure to display buyer’s guide. Failure to remove Texas plates. Failure to maintain complete records by licensed dealer or auction. $250.00. 12-1351 ENF Mondo Motors Inc., DBA Mondo Motors Inc. Failure to remove Texas plates. $50.00. 12-1352 ENF Patricio Ramirez, DBA R & S Auto Sales Failure to display buyer’s guide. Failure to remove Texas plates. Failure to meet premises requirement(s). $250.00. 12-1373 ENF Kyle Davis Avery, DBA Amigo Auto Sales Failure to display buyer’s guide. $100.00. 12-1394 ENF Farr Inc., DBA Triple R. Motors Failure to remove Texas plates. $50.00.
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Participation in the Legislative Process by Michael
s the current Texas legislature gets down to serious business, it would be appropriate to review the role of TIADA and its members in the legislative process. We find many people don’t really understand the dynamics involved in a successful legislative program. The Texas legislature meets every other year for approximately six months. (The governor can, and occasionally does, call special sessions in between regular sessions.) A tremendous amount of business is transacted in a very short period of time, given the size and scope of the state budget, and other issues state government faces. One of the most important functions of a trade association is to monitor proposed legislation, register opposition to bills that are harmful to the industry it represents and to work for passage of bills that will have a positive effect. Furthermore, an association should actively seek changes in the law that would improve the business climate for its members. TIADA is the only organization that represents used car dealers and the buy-here pay-here industry before the Texas Legislature. Under the leadership of Executive Director Jeff Martin, TIADA has been tremendously successful in building an effective legislative program and in expanding the active grass-roots participation of its members. TIADA’s presence and prestige have grown significantly over the last few sessions. Over the years, bills have been enacted that were proposed by TIADA that, among other things, overhauled the state’s motor vehicle sales tax law to allow deferred payment of sales tax,
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provided protection for lien holders in liability insurance claims, made positive changes to the mechanic’s lien law, and removed the burden of providing proof of liability coverage on title transfers. TIADA has worked with other trade groups to pass laws that directly or indirectly impact dealers, such as tort reform, improvements to the Texas Finance Code, tightening of the dealer licensing law, and guaranteeing the presence of an independent dealer on the Motor Vehicle Board. Bills that would have created a “lemon law” for used cars, bills that allow third parties to place liens on vehicles without notice to lien holders, and bills that would have placed unfair cost increases on dealers have been opposed and ultimately defeated. Occasionally, however, bills get passed that have a negative effect on independent dealers. Bills that require more stringent testing of vehicle emissions, for instance, have passed that placed more burdens and costs on dealers. Some bills are passed at the behest of strong interest groups or because of public policy shifts that swallow up the interests of small groups. Does the passage of such bills mean that TIADA is not doing its job? Hardly. There are also some issues that need to be addressed legislatively, but aren’t. For instance, some dealers feel that TIADA should do something about the income tax law that requires installment sellers to recognize income on the face value of contracts, or change the bankruptcy laws that allow debtors to drive their cars without paying. Of course, these are federal issues that TIADA can’t work
TIADA GENERAL COUNSEL
on directly, but instead must rely on its related national organization, NIADA, to address. It can be extremely disheartening when a dealer (usually a non-member or someone who is never heard from when assistance is requested on legislative issues) calls to complain that his or her “pet issue” is not being addressed, or that the passage of a certain bill must be the direct result of the association’s incompetence. The caller usually starts out asking “How could TIADA let this happen?” Or he or she might ask indignantly, “Why hasn’t TIADA done anything about this?” These statements are usually made out of anger and ignorance as to how things operate in the real world. TIADA is a democratic organization that is governed by a board of directors elected annually by the dealer members of the association. Initial proposals originate in committees, whose members are appointed by the state president. The legislative committee, for example, proposes the association’s course of action on legislative issues. A limit on available resources restricts the number of issues that can be addressed in the association’s legislative agenda. Therefore, a list of priorities is established that best serves the interests of all members and fits the budget. The committee’s report is then presented to the entire board of directors at a regular meeting for further discussion, approval or rejection. By necessity, this 33
activity takes place far in advance of the actual legislative session. Unfortunately, try as it might, no association can prevail on every legislative issue it faces. Some of the bills we champion will not get passed. Conversely, some of the bills we oppose will get passed in spite of our best efforts. For example, there are bills that are filed every session that are mandated by some federal government dictate. They will be passed whether we like them or not, not because we weren’t aware of them, or because we didn’t oppose them, but because millions of dollars of federal highway funding are at stake. Some bills will sneak through because of the surge of late night, last minute maneuvering that doesn’t allow for input or dissent. The point here is that TIADA’s voice is being heard. Despite the fact that only about 10 per cent of all licensed independent dealers are members and thus contribute to the legislative effort, good things are being accomplished. It is inevitable that, at the conclusion of this legislative session, some dealer will call and say: “How could you let this happen?” or “Why didn’t you do something about that?” Hopefully, more dealers who have a point of view to express, instead of griping about what was done or not done, will join TIADA and ask, “How can I be a part of the process and help to get some action on this issue?”
A PARTIAL LIST OF TIADA LEGISLATIVE ACCOMPLISHMENTS Sales Tax Reform. For years, Texas BHPH dealers faced an unpleasant dilemma: (1) advance 100 per cent of sales tax up front (with no refund for bad debt) and lose profitability; or (2) don’t pay sales tax up front and risk being put out of business by the comptroller. Many dealers took their chances with the latter option and got caught, resulting in million-dollar assessments. Others covered up the problem with creative bookkeeping. A group of TIADA members, facing impossible odds, raised the necessary money from themselves and other dealers, and got tax reform passed (as a side benefit, TIADA’s membership 34
grew to its highest level ever in the wake of the success). Now, sales tax is remitted monthly only on amounts collected. No tax is fronted, and no tax is due on bad debt. Plenty of folks told us it couldn’t be done, which made victory that much more satisfying. (See the July 2010 issue of Texas Dealer for a full discussion of how deferred sales tax came about.) Liability Insurance Protection. At one time, vehicle lien holders had no legal claim to insurance proceeds paid to their customers by liability insurance carriers. With damaged collateral and a debtor flush with insurance money to finance a new car, the lien holder was left holding the bag. But a few years back TIADA sponsored legislation that placed a lien on liability proceeds for recorded lien holders. In terms of benefit-to-cost, this bill surely ranks up there as dealers have collected untold amounts that would have been lost under prior law. It seems that just about every week, a simple demand letter to an unbelieving insurance company results in a check being sent to a dealer who had been excluded from the initial settlement check. Elimination Of Liability Insurance Proof At Transfer. One of the biggest headaches that dealers faced through much of the 90’s was the convergence of (1) the requirement that dealers handle all title transfers on vehicles they sold, and (2) the requirement that proof of liability insurance in a buyer’s name be presented with all title transfers. When buyers failed to bring in proof of insurance by the time title had to be transferred, dealers became sitting ducks for state enforcement officers who issued fines for failure to timely transfer title. TIADA pushed for legislation that would exempt dealers from being the liability insurance police. While there might still be plenty of outlaws who don’t timely transfer title, the honest, law-abiding dealer was, upon passage of this legislation, again able to transfer and record his lien, without being held hostage by a lawbreaking customer.
Recent sessions have produced equally impressive results, including mechanic’s lien restrictions, application of deferred sales tax to related finance companies, and extension of transfer times on titles. But the satisfaction of accomplishing in the early days so much with so little, and the occasional thank you from someone acknowledging our efforts, has made those victories even sweeter. Mechanics Lien Reform. Rampant abuses of the mechanic’s lien law by title services, shade-tree mechanics, and outright car thieves led to the effort to overhaul of statute in 2009. With the help of some influential county tax collectors, TIADA was able to tighten the requirements for obtaining a free-and-clear title so that fraudulent applications would face significantly tougher scrutiny. Related Finance Companies. Prior to 2007, dealers who had set up related finance companies to take advantage of federal income tax rules faced the prospect of deferred sales tax being accelerated when they assigned their contracts to their RFC. TIADA successfully sought legislation that would allow RFCs to continue to defer sales tax when certain common ownership rules were met. An Independent Dealer On The Motor Vehicle Board. When the Motor Vehicle Division was transferred from the Texas Department of Transportation to the newly-formed Texas Department of Motor Vehicles, TIADA was able to get a spot on that agency’s board of directors designated for an independent dealer. Having one of our own on the Board has given dealers the opportunity to have their interests represented at the highest level of policy making. Michael W. Dunagan is an attorney in Dallas, Texas who has represented the Texas Independent Automobile Dealers Association for over 36 years. He has written a number of books and hundreds of articles for trade journals and law reviews. His clientele includes dealers, banks, finance companies, auto auctions and credit unions. T e x a s
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TIADA DEALER ACADEMY 2012/2013
Dealer 101: Nobody Told Me That! This class is designed for those dealers new to the business, those considering opening their own dealership, new employees, family members or anyone else needing a refresher on the basics. Weâ€™ll cover everything you need to know to run a clean, compliant used car dealership in Texas. Topics include: n n
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8:30am - 5:00pm $149 Per Registrant
Transferring Titles Inspections, Emissions, Green Slip Garage Liability & Dealer Bond Odometers Title & Registration Fees Acquiring Inventory Temp Tags & Metal Dealer Plates Requirements for Maintaining Dealer License The Buyerâ€™s Guide - As Is
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SOLD! The Deal Jacket Record Keeping Motor Vehicle Sales Tax Vehicle Inventory Tax Consignment Online Sales Out of State / Out of Country OCCC: the MVSF License Advertising Rules Federal Requirements Forms Review Resources
We will build a deal jacket from scratch... we will role-play an actual of transfer of title at the tax office... we will do a simulation of VIT calculation, with real numbers over multiple years... and much more. TIADA teaches you the business from an experienced, practical point of view.
Presenters will include:
Dorothy Starr, Motor Vehicle Manager, Tarrant County Tax Assessor-Collector Danny Langfield, Deputy Director, TIADA Michael W. Dunagan, attorney, Jameson & Dunagan, TIADA General Counsel
Monday, February 11, 2013 San Antonio, Texas
DoubleTree by Hilton San Antonio Airport 37 NE Loop 410 (at McCullough) San Antonio, TX 78216 | 210.366.2424 www.carsplussoftware.com
Upcoming seminar dates: April 29, 2013 - Houston; June 17, 2013 - Dallas
Register online at w w w . t x i a d a . c o m or by phone at 800.442.5944. Texas Independent Automobile Dealers Association
regulation matters Out-of-State & Out-of-Country Sales
ne of the modules in the Dealer 101 seminar is entitled, “Out of State / Out of Country – Titling, Tags, Taxes & ID” and it generated some interesting questions from attendees at our class in December. Let’s take a look at how these transactions differ from an in-state sale, as well as how they differ from each other.
Titling – A Texas dealer is not required to apply for title in the name of the buyer if the vehicle is to be titled and registered outside of Texas. There is, however, a requirement that the paperwork be given to the buyer within 30 calendar days of sale. Tags – For a retail sale, issue a buyer’s tag and collect the $5 e-Tag fee. For a wholesale deal, make sure the out-ofstate dealer knows he needs a tag from his state if the vehicle will be driven. Neither a buyer’s tag nor the selling dealer’s dealer tag should be used on a vehicle being driven in Texas that was purchased wholesale for out-of-state resale. Taxes – Motor vehicle tax is not due as long as there will be no use of the vehicle in Texas other than the immediate transportation of the vehicle out of the state. Any other scenario will trigger the tax being required. The dealer must have the Texas Motor Vehicle Sales Tax Exemption Certificate – for Vehicles Taken Out of State tax form signed by the customer and the dealer must send that completed, signed form to the Comptroller. No motor vehicle tax is due on wholesale transactions, instate or otherwise. A Texas Motor Vehicle Sales Tax Resale Certificate must be completed and retained by the selling dealer, but it does not need to be sent to the Comptroller. ID – Currently we recommend that you follow the same ID procedures that you would for an in-state sale. The new admin rule for ID is not entirely clear on this matter; next month’s Regulation Matters should address this. Note, though, that out-of-country sales DO have an ID requirement (outlined below).
Titling – The same titling requirements as above apply; however, in an out-of-country sale you must also stamp the title “For Export Only.” The stamp must be at least two inches wide, contain your P number and be done in black ink. The title must be stamped once on the front, in January 2013
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TIADA DEPUTY DIRECTOR
an area that doesn’t cover any information, and on each unused reassignment space on the back of the title. Tags – The same rules as above apply for tags on outof-country retail sales. For wholesale transactions, the dealer will need to provide tags from his home country; the law does not provide for a situation where the out-ofstate dealer has no dealer plate or tag. If this situation occurs, contact TIADA for a possible work-around. Taxes – Again, motor vehicle tax is not due as long as the vehicle will be used exclusively outside Texas. An exemption form must be completed, as described above. ID – Export Sales are subject to specific ID rules found in the Admin Code at 43 TAC §215.147: (a) Before selling a motor vehicle for export from the United States to another country, a dealer must obtain a legible photocopy of the buyer’s government-issued photo identification document. The identification document must be issued by the jurisdiction where the buyer resides and may consist of: (1) a passport; (2) a driver’s license; (3) a consular identity document; (4) a national identification certificate or identity document; or (5) other identification issued by the jurisdiction where the buyer resides that is able to be verified by law enforcement and includes the name of the issuing jurisdiction, the buyer’s full name, foreign address, date of birth, photograph, and signature. A few other notes: regarding taxes, the Comptroller offers a guidebook which addresses various tax exemption scenarios. It can be found at www.window.state.tx.us/ taxinfo/taxpubs/tx96_254.pdf. Regarding e-Tags, bear in mind that all retail sales must be registered in the e-Tag system (even if the vehicle will not be driven) and the $5 fee collected. Since you will not be making title application in an out-of-state / out-of-country sale, the $5 fee will need to be remitted to the county separately. 37
behind the wheel
Helping You Succeed
ast month I received a text and two phone calls from different dealers who wanted me to know they had taken the compliance quiz in the December issue of the Texas Dealer. This is the third year we have published the compliance quiz and it has become a favorite issue for many members. It’s a small sample size but my inkling is there were no perfect scores. Two of the dealers I talked to only missed two questions and like a good independent dealer they were actually looking to debate the accuracy of our answers. Publishing the quiz is meant to help you navigate through the various laws, rules and policies used to regulate our industry but more importantly we hope it creates a heightened sense of awareness for you and your dealership by spending some time thinking about compliance. When you consider our relationship with legislators and our advocacy efforts, matched with our constant communication with the policy-makers at all the state agencies that oversee auto dealers in Texas, it’s no wonder we spend so much time focusing on compliance. No one knows the laws, rules and policies quite like TIADA. No one understands your challenges in this area as well as your association. However, compliance is kind of like taking bitter medicine. No matter how much honey you mix with the medicine, or water you have to chase it with, you still have a bad taste in your mouth afterward. We know there is more to running a successful dealership in Texas than simply trying to keep your nose clean
TIADA EXECUTIVE DIRECTOR
and receiving positive audit reports from DMV, OCCC, the Comptroller or whoever else might show up at your doorstep. As a successful dealer you have to constantly study best practices, adapt to changes in the market and employee strategies that will help you improve the bottom line. While the answers to best practices and business strategies are not as black and white as compliance do’s and don’ts, we are committed to introducing ideas and experts you can learn from. In 2012 we launched a new addition to our Texas Dealer Academy, “Solving the BHPH Puzzle” and have seen impressive growth already. Over the past couple of years we have seen our conference grow to almost 200 dealers by bringing in the most knowledgeable professionals in the industry and developing an environment that fosters the sharing of creative ideas from dealer to dealer. This year’s conference will include a customer focus group. I can’t give you all the details, but trust me - you have never seen anything like this at any conference before. Next month the Texas Dealer will be devoted to best practices and ideas to help you run and improve your dealership with an article focused on the customer’s experience (we will still run Legal Corner and Regulation Matters for you hardcore do-gooders). Lastly, we will continue listening to you in order to provide you with what you need. Our most successful programs, articles and classes have always come from trying to fill your needs and exceed your expectations as a member. Our goal is to help you be a successful Texas dealer. If you have a second, let us know what we can to do to help.
...we are committed to introducing ideas and experts you can learn from. 38
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*Substantial Discounts for TIADA Members
TEXAS INDEPENDENT AUTOMOBILE DEALERS ASSOCIATION P.O. Box 127 Round Rock, TX 78680-0127
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