Session of 1998
                   
HOUSE BILL No. 2698
         
By Representative Beggs
         
1-23
            9             AN ACT amending the vehicle dealers and manufacturers licensing act;
10             concerning all-terrain vehicle dealers; amending K.S.A. 8-2406 and
11             8-2409 and K.S.A. 1997 Supp. 8-2401 and repealing the existing
12             sections.
13            
14       Be it enacted by the Legislature of the State of Kansas:
15           Section 1. K.S.A. 1997 Supp. 8-2401 is hereby amended to read as
16       follows: 8-2401. As used in this act, the following words and phrases shall
17       have the meanings:
18           (a) ``Vehicle dealer'' means any person who: (1) For commission,
19       money or other thing of value is engaged in the business of buying, selling
20       or offering or attempting to negotiate a sale of an interest in vehicles; or
21       (2) for commission, money or other thing of value is engaged in the busi-
22       ness of buying, selling or offering or attempting to negotiate a sale of an
23       interest in motor vehicles as an auction motor vehicle dealer as defined
24       in (bb); but does not include: (A) Receivers, trustees, administrators, ex-
25       ecutors, guardians, or other persons appointed by or acting under the
26       judgment or order of any court, or any bank, trustee or lending company
27       or institution which is subject to state or federal regulations as such, with
28       regard to its disposition of repossessed vehicles; (B) public officers while
29       performing their official duties; (C) employees of persons enumerated in
30       provisions (A) and (B), when engaged in the specific performance of their
31       duties as such employees; (D) auctioneers conducting auctions for per-
32       sons enumerated in provisions (A), (B) or (C); or (E) auctioneers who,
33       while engaged in conducting an auction of tangible personal property for
34       others, offer for sale: (i) Vehicles which have been used primarily in a
35       farm or business operation by the owner offering the vehicle for sale,
36       including all vehicles which qualified for a farm vehicle tag at the time of
37       sale except vehicles owned by a business engaged primarily in the business
38       of leasing or renting passenger cars; (ii) vehicles which meet the statutory
39       definition of antique vehicles; or (iii) vehicles for no more than four prin-
40       cipals or households per auction. All sales of vehicles exempted pursuant
41       to provision (E), except truck, truck tractors, pole trailers, trailers and
42       semitrailers as defined by K.S.A. 8-126, and amendments thereto, shall
43       be registered in Kansas prior to the sale.

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  1           (b) ``New vehicle dealer'' means any vehicle dealer who is a party to
  2       an agreement, with a first or second stage manufacturer or distributor,
  3       which agreement authorizes the vehicle dealer to sell, exchange or trans-
  4       fer new motor vehicles, trucks, motorcycles, all-terrain vehicles or trailers
  5       or parts and accessories made or sold by such first or second stage man-
  6       ufacturer or distributor and obligates the vehicle dealer to fulfill the war-
  7       ranty commitments of such first or second stage manufacturer or distrib-
  8       utor.
  9           (c) ``Used vehicle dealer'' means any person actively engaged in the
10       business of buying, selling or exchanging used vehicles.
11           (d) ``Vehicle salesperson'' means any person who is employed as a
12       salesperson by a vehicle dealer to sell vehicles.
13           (e) ``Board'' means the vehicle dealer review board created by this
14       act.
15           (f) ``Director'' means the director of vehicles, or a designee of the
16       director.
17           (g) ``Division'' means the division of vehicles of the department of
18       revenue.
19           (h) ``Vehicle'' means:
20           (1) Every device in, upon or by which any person or property is or
21       may be transported or drawn upon a public highway, and is required to
22       be registered under the provisions of article 1 of chapter 8 of Kansas
23       Statutes Annotated except that such term shall not include motorized
24       bicycles, and such term shall not include manufactured homes or mobile
25       homes. As used herein in this paragraph, the terms ``manufactured
26       home'' and ``mobile home'' shall have the meanings ascribed to them by
27       K.S.A. 58-4202, and amendments thereto; or
28           (2) all-terrain vehicles.
29           (i) ``Motor vehicle'' means:
30           (1) Any vehicle other than a motorized bicycle, which is self-propelled
31       and is required to be registered under the provisions of article 1 of chapter
32       8 of Kansas Statutes Annotated; or
33           (2) all-terrain vehicles.
34           (j) ``Licensor'' means the director or division or both.
35           (k) ``First stage manufacturer'' means any person who manufactures,
36       assembles and sells new vehicles to new vehicle dealers for resale in this
37       state.
38           (l) ``Second stage manufacturer'' means any person who assembles,
39       installs or permanently affixes body, cab or special unit equipment to a
40       chassis supplied by a first stage manufacturer, distributor or other sup-
41       plier and sells the resulting new vehicles to new vehicle dealers for resale
42       in this state.
43           (m) ``First stage converter'' means any person who is engaged in the

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  1       business of affixing to a chassis supplied by a first stage manufacturer,
  2       distributor or other supplier, specially constructed body units to result in
  3       motor vehicles used as, but not limited to, buses, wreckers, cement trucks
  4       and trash compactors.
  5           (n) ``Second stage converter'' means any person who is engaged in
  6       the business of adding to, subtracting from or modifying previously as-
  7       sembled or manufactured vehicles and sells the resulting converted ve-
  8       hicles at retail or wholesale.
  9           (o) ``Distributor'' means any person who sells or distributes for resale
10       new vehicles to new vehicle dealers in this state or who maintains dis-
11       tributor representatives in this state.
12           (p) ``Wholesaler'' means any person who purchases vehicles for the
13       purpose of resale to a vehicle dealer.
14           (q) ``Factory branch'' means any branch office maintained in this state
15       by a first or second stage manufacturer for the sale of new vehicles to
16       distributors, or for the sale of new vehicles to new vehicle dealers, or for
17       directing or supervising, in whole or in part, its representatives in this
18       state.
19           (r) ``Distributor branch'' means any branch office similar to subsec-
20       tion (q) maintained by a distributor for the same purposes as a factory
21       branch.
22           (s) ``Factory representative'' means a representative employed by a
23       first or second stage manufacturer or factory branch for the purpose of
24       making or promoting the sale of its new vehicles to new vehicle dealers,
25       or for supervising or contacting its new vehicle dealers or prospective new
26       vehicle dealers with respect to the promotion and sale of such vehicles
27       and parts or accessories for the same.
28           (t) ``Distributor representative'' means any representative similar to
29       subsection (s) employed by a distributor or distributor branch for the
30       same purpose as a factory representative.
31           (u) ``Person'' means any natural person, partnership, firm, corpora-
32       tion or association.
33           (v) ``New motor vehicle'' means any motor vehicle which has never
34       been titled or registered and has not been substantially driven or oper-
35       ated.
36           (w) ``Franchise agreement'' means any contract or franchise or any
37       other terminology used to describe the contractual relationship between
38       first or second stage manufacturers, distributors and vehicle dealers, by
39       which:
40           (1) A right is granted one party to engage in the business of offering,
41       selling or otherwise distributing goods or services under a marketing plan
42       or system prescribed in substantial part by the other party, and in which
43       there is a community of interest in the marketing of goods or services at

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  1       wholesale or retail, by lease, agreement or otherwise; and
  2           (2) the operation of the grantee's business pursuant to such agree-
  3       ment is substantially associated with the grantor's trademark, service
  4       mark, trade name, logotype, advertising or other commercial symbol des-
  5       ignating the grantor or an affiliate of the grantor.
  6           (x) ``Broker'' means any person who, for a fee, commission, money,
  7       other thing of value, valuable consideration or benefit, either directly or
  8       indirectly, arranges or offers to arrange a transaction involving the sale of
  9       a vehicle, or is engaged in the business of: (1) Selling or buying vehicles
10       for other persons as an agent, middleman or negotiator; or (2) bringing
11       buyers and sellers of vehicles together, but such term shall not include
12       any person registered as a salvage vehicle pool or any person engaged in
13       a business in which the acts described in this subsection are only inci-
14       dentally performed or which are performed or authorized within the
15       requirements or scope of any other category of license, or not prohibited,
16       in the manner authorized by the vehicle dealers' and manufacturers' li-
17       censing act.
18           (y) ``Salvage vehicle dealer'' means any person engaged in the busi-
19       ness of buying , selling or exchanging used vehicles and primarily engaged
20       in the business of the distribution at wholesale or retail of used motor
21       vehicle parts and includes establishments primarily engaged in disman-
22       tling motor vehicles for the purpose of selling parts.
23           (z) ``Lending agency'' means any person, desiring to be licensed un-
24       der this act and engaged in the business of financing or lending money
25       to any person to be used in the purchase or financing of a vehicle.
26           (aa) ``Established place of business'' means a building or structure,
27       other than a building or structure all or part of which is occupied or used
28       as a residence, owned either in fee or leased and designated as an office
29       or place to receive mail and keep records and conduct the routine of
30       business. To qualify as an established place of business, there shall be
31       located therein an operable telephone which shall be listed with the tel-
32       ephone company under the name of the licensed business, except that a
33       vehicle dealer who derives at least 50% of such person's income from
34       operating a farm as a resident thereof, the established place of business
35       may be the farm residence of such vehicle dealer and the operable tele-
36       phone may be located in such residence when such dealer engages only
37       in vehicles and equipment not required to have vehicle registration to
38       travel on a highway.
39           (bb) ``Auction motor vehicle dealer'' means any person who for com-
40       mission, money or other thing of value is engaged in an auction of motor
41       vehicles except that the sales of such motor vehicles shall involve only
42       motor vehicles owned by licensed motor vehicle dealers and sold to li-
43       censed motor vehicle dealers, except that any auction motor vehicle

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  1       dealer, registered as such and lawfully operating prior to June 30, 1980,
  2       shall be deemed to be and have been properly licensed under this act
  3       from and after July 1, 1980. For the purposes of this subsection, an auc-
  4       tion is a private sale of motor vehicles where any and all licensed motor
  5       vehicle dealers who choose to do so are permitted to attend and offer
  6       bids and the private sale of such motor vehicles is to the highest bidder.
  7           (cc) ``Licensee'' means any person issued a valid license pursuant to
  8       this act.
  9           (dd) ``Dealer'' means a vehicle dealer as defined by this act, unless
10       the context otherwise requires.
11           (ee) ``Insurance company'' means any person desiring to be licensed
12       under this act and engaged in the business of writing or servicing insur-
13       ance related to vehicles.
14           (ff) ``Supplemental place of business'' means a business location other
15       than that of the established place of business of the dealer which may be
16       operated by the dealer on a continuous year-round basis and, for new
17       vehicle dealers, is within the defined area of responsibility in their fran-
18       chise agreement, and for all other dealers is within the same city or county
19       where the established place of business of the dealer is operated.
20           (gg) ``Salvage yard'' means the place owned or leased and regularly
21       occupied by a person, firm or corporation licensed under the provisions
22       of this act for the principal purpose of engaging in the business of a salvage
23       vehicle dealer. Salvage yard shall include the location where the:
24           (1) Products for sale are displayed and offered for sale;
25           (2) books and records required for the conduct of the business are
26       maintained;
27           (3) records are kept in the normal daily business activity; and
28           (4) records are made available for inspection.
29           (hh) ``Salvage vehicle pool'' means any person who as an agent for a
30       third party is primarily engaged in the business of storing, displaying and
31       offering for sale salvage vehicles.
32           (ii) ``Major component part'' means any vehicle part including the
33       front clip, rear clip, doors, frame, chassis, engine, transmission, transaxle,
34       cab, bed and box bearing the public vehicle identification number or
35       engine number, if manufactured prior to 1981; or any vehicle part bearing
36       a derivative of such number.
37           (jj) ``Recreational motor vehicle'' means a recreational vehicle as de-
38       fined by subsection (f) of K.S.A. 75-1212, and amendments thereto.
39           (kk) ``All-terrain vehicle'' means any motorized nonhighway vehicle
40       45 inches or less in width, having a dry weight of 650 pounds or less,
41       traveling on three or more low-pressure tires and having a seat designed
42       to be straddled by the operator. As used in this section, ``low-pressure
43       tire'' means any pneumatic tire six inches or more in width, designed for

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  1       use on wheels with a rim diameter of 12 inches or less and utilizing an
  2       operating pressure of 10 pounds per square inch or less as recommended
  3       by the vehicle manufacturer.
  4           Sec. 2. K.S.A. 8-2406 is hereby amended to read as follows: 8-2406.
  5       (a) The annual fee for the first dealer license plate is $275, and the annual
  6       fee for additional dealer license plates shall be an amount equal to the
  7       amount required to register a passenger vehicle having a gross weight of
  8       less than 4,500 pounds, except that the annual fee for dealer license plates
  9       used by trailer dealers on trailers which they have purchased or own and
10       are holding for resale shall be $25 for each plate. To determine the num-
11       ber of dealer license plates the dealer needs, the director may base the
12       decision on the dealer's past sales, inventory and any other pertinent
13       factors as the director may determine. After the end of the first year of
14       licensure as a dealer, not more than one dealer license plate shall be
15       issued to any dealer who has not reported to the division the sale of at
16       least five motor vehicles in the preceding year. There shall be no refund
17       of fees for dealer license plates in the event of suspension, revocation or
18       voluntary cancellation of a license. The director is hereby authorized to
19       designate by identifying symbols on a dealer's license plate the type of
20       dealer's license that the person has been issued. If a dealer has an estab-
21       lished place of business in more than one county, such dealer shall secure
22       a separate and distinct dealer's license and dealer license plates for each
23       established place of business.
24           (b) New motor vehicle dealers and used motor vehicle dealers may
25       authorize use of dealer license plates assigned to such motor vehicle deal-
26       ers as follows:
27           (1) The licensed motor vehicle dealer and such dealer's spouse;
28           (2) the sales manager and all other sales personnel when such man-
29       ager and sales personnel are properly licensed in Kansas, except that no
30       dealer license plate shall be assigned to sales personnel who are working
31       at the established place of business of the dealer less than 20 hours per
32       week;
33           (3) any employee of such motor vehicle dealer when the use thereof
34       is directly connected to a particular business transaction of such motor
35       vehicle dealer;
36           (4) the customer when operating a motor vehicle in connection with
37       negotiations to purchase such motor vehicle or during a demonstration
38       of such motor vehicle;
39           (5) any school district and any accredited nonpublic school which has
40       entered into an agreement with a dealer to use a motor vehicle as a driver
41       training motor vehicle, as defined in K.S.A. 72-5015, and amendments
42       thereto, in an approved driver training course.
43           (c) A wholesaler dealer may authorize the use of dealer license plates

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  1       on vehicles purchased by the wholesaler for resale to a retail vehicle dealer
  2       as follows:
  3           (1) To transport or operate a vehicle to or from a licensed retail or
  4       wholesale vehicle dealer for the purpose of buying, selling, or offering or
  5       attempting to negotiate a sale of the vehicle to a licensed vehicle dealer;
  6           (2) to deliver a vehicle purchased from the wholesale vehicle dealer
  7       to a purchasing vehicle dealer.
  8           (d) Salvage vehicle dealers may use dealer license plates only on ve-
  9       hicles which they have purchased for salvage, including dismantling, dis-
10       assembling or recycling.
11           (e) Insurance companies may use dealer license plates only on vehi-
12       cles purchased or acquired for salvage in the course of business of the
13       insurance company.
14           (f) Lending agencies may use dealer license plates only on vehicles
15       which they have repossessed or are holding for disposition due to repos-
16       session.
17           (g) Trailer dealers may use dealer license plates only on trailers which
18       they have purchased or own and are holding for resale.
19           (h) All-terrain vehicle dealers and brokers are not entitled to be as-
20       signed or to use any dealer license plates.
21           (i) Except as provided above, dealer license plates shall be used only
22       in accordance with the provisions of K.S.A. 8-136, and amendments
23       thereto. This subsection (i) does not apply to K.S.A. 8-2425, and amend-
24       ments thereto, or full-privilege license plates issued thereunder.
25           Sec. 3. K.S.A. 8-2409 is hereby amended to read as follows: 8-2409.
26       (a) Any dealer may purchase from the division of vehicles thirty-day tem-
27       porary registration permits, in multiples of five permits valid for 30 days
28       at a cost of $3 each. Such dealer shall have completed the application and
29       permit as required by the division and mail a copy of such application to
30       the division within 24 hours from the date of issuance. Such registration
31       shall not extend the date when registration fees are due, but shall be valid
32       registration for a period of 30 days from date of issuance. The dealer
33       upon presentation of evidence of ownership in the applicant and evidence
34       that the sales tax has been paid, if due, shall issue a sticker or paper
35       registration as determined by the division. No dealer, or county treasurer,
36       as authorized by K.S.A. 8-143, and amendments thereto, shall issue more
37       than one thirty-day temporary registration permit to the purchaser of a
38       vehicle.
39           (b) The division of vehicles may deny any dealer the authority to
40       purchase thirty-day temporary permits if the vehicle dealer is delinquent
41       in monthly sales reports to the division for two months or more or if the
42       vehicle dealer is found to have issued more than one thirty-day permit to
43       the purchaser of a vehicle.

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  1           (c) The temporary registration authorized by this section shall not
  2       entitle a truck, truck tractor or any combination of truck or truck tractor
  3       and any type of trailer or semitrailer to be operated under laden condi-
  4       tions, except that such temporary registration shall authorize any such
  5       vehicle or combination of vehicles to be operated under laden conditions
  6       for 48 hours after the time of issuance of the temporary permit.
  7           (d) All-terrain vehicle dealers may not purchase any thirty-day tem-
  8       porary registration permits.
  9           Sec. 4. K.S.A. 8-2406 and 8-2409 and K.S.A. 1997 Supp. 8-2401 are
10       hereby repealed.
11           Sec. 5. This act shall take effect and be in force from and after its
12       publication in the statute book.
13