SSB 3165 (LSB 6062SC (2) 84)

SENATE FILE _____

BY  (PROPOSED COMMITTEE ON TRANSPORTATION BILL BY CHAIRPERSON RIELLY)

A BILL FOR

An Act relating to motorcycle dealer activities at motorcycle rallies and to the definition of travel trailer for purposes of travel trailer dealer requirements.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:

    Section 1.  Section 322.2, Code 2011, is amended by adding the following new subsection:
   NEW SUBSECTION.  11A.  “Motorcycle” means as defined in section 321.1. “Motorcycle” does not include an all-terrain vehicle as defined in section 321.1.
    Sec. 2.  Section 322.4, subsection 1, paragraph g, Code 2011, is amended to read as follows:
   g.  Before the issuance of a motor vehicle dealer’s license to a dealer engaged in the sale of vehicles for which a certificate of title is required under chapter 321,
 
or the issuance of a temporary permit under section 322.5, subsection 6, paragraph “b”, the applicant shall furnish a surety bond executed by the applicant as principal and executed by a corporate surety company, licensed and qualified to do business within this state, which bond shall run to the state of Iowa, be in the amount of fifty thousand dollars and be conditioned upon the faithful compliance by the applicant as a dealer with all of the statutes of this state regulating or applicable to the business of a dealer in motor vehicles, and indemnifying any person who buys a motor vehicle from the dealer from any loss or damage occasioned by the failure of the dealer to comply with any of the provisions of chapter 321 and this chapter, including but not limited to the furnishing of a proper and valid certificate of title to the motor vehicle involved in a transaction. The bond shall also indemnify any motor vehicle purchaser from any loss or damage caused by the failure of the dealer to comply with the odometer requirements in section 321.71, regardless of whether the motor vehicle was purchased directly from the dealer. The bond shall be filed with the department prior to the issuance of a license
 
or permit. The aggregate liability of the surety, however, shall not exceed the amount of the bond.
    Sec. 3.  Section 322.5, Code 2011, is amended by adding the following new subsection:
   NEW SUBSECTION.  6.
  a.  Upon application for and receipt of a temporary permit issued by the department under this subsection, a motor vehicle dealer authorized to sell used motorcycles may display, offer for sale, and negotiate sales of used motorcycles at a motorcycle rally located in this state that meets all of the following conditions:
   (1)  The sponsor of the rally conducts not more than one rally annually in this state.
   (2)  The rally is conducted for a single period of not less than three and not more than seven consecutive days.
   (3)  Attendance at the rally is restricted to persons who have paid a nonrefundable admission fee to the sponsor of the rally.
   b.  A person licensed as a motor vehicle dealer in another state may apply for and be issued a temporary permit under this subsection if the person meets all of the following conditions:
   (1)  The person presents the department with a current motor vehicle dealer license valid for the sale of used motorcycles at retail in the person’s state of residence.
   (2)  The state in which the person is licensed as a motor vehicle dealer allows a motor vehicle dealer licensed in Iowa to be issued a permit substantially similar to the temporary permit authorized under this section.
   (3)  The person furnishes to the department a surety bond that meets the requirements of section 322.4, subsection 1, paragraph “g”.
   (4)  The person presents any additional information the department may require.
   c.  Application for a temporary permit under this subsection shall be made on forms provided by the department accompanied by a fee established by the department by rule.
   d.  A sale of a motorcycle at a motorcycle rally shall not be completed and an agreement for the sale of a motorcycle shall not be signed at a motorcycle rally. All such sales shall be consummated at the motor vehicle dealer’s principal place of business.

   e.  The department may issue a temporary permit under this subsection for a period not to exceed seven consecutive days. A motor vehicle dealer may not receive more than one temporary permit issued under this subsection in a calendar year.
    Sec. 4.  Section 322C.2, subsection 10, Code 2011, is amended to read as follows:
   10.  “Travel trailer” means a vehicle without motive power used or so manufactured or constructed as to permit its being used as a conveyance upon the public streets and highways and designed to permit the vehicle to be used as a place of human habitation by one or more persons. The vehicle may be up to eight feet six inches in width and its overall length shall not exceed forty feet.

“Travel trailer” does not include a vehicle that is so designed as to permit it to be towed exclusively by a motorcycle.
EXPLANATION
   This bill provides for the display of used motorcycles offered for sale at motorcycle rallies, provided the sponsor of the rally holds no more than one rally per year in this state, the rally is conducted for not less than three and not more than seven days, and attendance at the rally is restricted to persons paying a nonrefundable admission fee.
   Under the bill, a person licensed as a motor vehicle dealer and authorized to sell used motorcycles may apply to the department of transportation for a temporary permit to display, offer for sale, and negotiate sales of used motorcycles at a rally. The fee for the permit is to be established by the department by rule. A temporary permit may be issued for a period of not more than seven days, and a motor vehicle dealer may not be issued more than one such permit in a calendar year.
   A person licensed as a motor vehicle dealer in another state may be issued a temporary permit to display, offer for sale, and negotiate sales of used motorcycles at a rally in this state if the dealer presents to the department a current license valid for the sale of used motorcycles at retail in the person’s state of residence, provided that the dealer’s home state extends similar privileges to a dealer licensed in this state. A dealer from another state must furnish a surety bond that meets current requirements for motor vehicle dealer licensing. 
   A temporary permit issued under the bill does not allow a dealer to complete the sale of a used motorcycle at a motorcycle rally. The bill specifies that the sale shall not be completed and a sales agreement shall not be signed at the rally. The sale must be consummated at the motor vehicle dealer’s principal place of business.
   The bill amends the definition of “travel trailer” for purposes of Code chapter 322C to exclude vehicles designed to be towed exclusively by a motorcycle. As a result, sales of motorcycle trailers are exempt from the travel trailer dealer licensing requirements and from a specific provision in Code section 322C.12 relating to finance charges under a travel trailer retail installment contract.