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Minutes for SB305 - Committee on Transportation
Short Title
Increasing the bond amount required for a vehicle dealer license.
Minutes Content for Mon, Feb 10, 2020
Chairman Petersen opened the hearing on SB305.
Mr. Siebers briefed the Committee on the bill; he said the bill increases the bond amount required for a vehicle dealer's license from $30,000 to $50,000.
Deann Williams, Deputy Secretary, Division of Vehicles, KDOR (in the place of Lee Ann Phelps), spoke as a proponent for the bill (Attachment 8). Noting the current bond requirement of $30,000, she explained that newer vehicles are much more expensive than in years past; the bill increases the cost of the bond in order to reflect that increase in the cost of vehicles. The bill will also more closely align with other states' requirements. She cited the past three years' claims: CY2017, 10 claims; CY2018, 10 claims; and CY2019, 8 claims. Responding to a question, she replied that the $50,000 bond applies to each dealer and that the claims in 2019 totaled $119,000.
Don McNeely, President, Kansas Automobile Dealers Association, also spoke in favor of the bill (Attachment 9). He noted that the cost of the average car currently is $35,608, an amount that indicates a need to raise the bond limit to $50,000. He reported that the bond cost for each dealer is $10 per $1000 and that the bond claims usually involve the smaller used-car dealers. A member commented that a car dealer must be bonded in order to receive a license.
The Chair closed the hearing on SB305.
The meeting was adjourned at 9:10 a.m. The next meeting is scheduled for Tuesday, February 11, 2020.
