HF 758 (LSB 2362HV (1) 91)

HOUSE FILE 758

BY  COMMITTEE ON TRANSPORTATION

(SUCCESSOR TO HSB 133)

A BILL FOR

An Act relating to administrative fees charged by motor vehicle dealers, and making penalties applicable.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:

    Section 1.  Section 322.19A, subsections 1, 2, and 3, Code 2025, are amended to read as follows:
   1.  For purposes of this section, “documentary fee”
“administrative fee” means a fee that may be charged to a customer by a motor vehicle dealer for the preparation of documents related to an application for motor vehicle registration and an application for issuance of a certificate of title, and the performance of other related performing services for, related to the sale of a motor vehicle, on behalf of the customer. “Documentary fee” “Administrative fee” does not include any costs or fees charged to a motor vehicle dealer or a dealer’s customer by a third party.
   2.  A motor vehicle dealer may charge a documentary an administrative fee not to exceed one hundred eighty dollars for each motor vehicle sold in a transaction.
   3.  A motor vehicle dealer who charges a documentary an administrative fee to a customer shall include the fee in the price of the motor vehicle. The dealer shall disclose the full amount of the fee in any price of a motor vehicle advertised by the dealer and when making or accepting an offer to sell a motor vehicle. The dealer shall provide the following notice to the customer, which notice shall be clearly and conspicuously disclosed in any motor vehicle purchase agreement with the customer:
   DOCUMENTARY ADMINISTRATIVE FEE. A DOCUMENTARY AN ADMINISTRATIVE FEE IS NOT AN OFFICIAL FEE. A DOCUMENTARY AN ADMINISTRATIVE FEE IS NOT REQUIRED BY LAW, BUT MAY BE CHARGED TO A BUYER CUSTOMER FOR THE PREPARATION OF DOCUMENTS AND THE PERFORMANCE OF RELATED PERFORMING SERVICES, RELATED TO THE SALE OF A MOTOR VEHICLE, ON BEHALF OF THE CUSTOMER. THE MAXIMUM AMOUNT THAT MAY BE CHARGED FOR A DOCUMENTARY FEE IS DETERMINED BY IOWA CODE SECTION 322.19A. THIS NOTICE IS REQUIRED BY LAW.
EXPLANATION
The inclusion of this explanation does not constitute agreement with
the explanation’s substance by the members of the general assembly.
   Under current law, a motor vehicle dealer (dealer) is authorized to charge a documentary fee not to exceed $180 for each motor vehicle sold in a transaction. A “documentary fee” is a fee charged to a customer by a dealer for the preparation of documents related to an application for motor vehicle registration and an application for issuance of a certificate of title, and the performance of other related services for the customer, but does not include any costs or fees charged to a dealer or a dealer’s customer by a third party. A dealer who charges a documentary fee is required to include the fee in the price of the motor vehicle, in advertisements for the vehicle, and when making or accepting an offer for the vehicle. A dealer is required to clearly and conspicuously disclose a specific notice of the fee in any motor vehicle purchase agreement with a customer.
   This bill authorizes a dealer to charge an administrative fee, rather than a documentary fee, to a customer for performing services, related to the sale of a motor vehicle, on behalf of the customer. The bill strikes the maximum amount a dealer is authorized to charge for such a fee. The bill makes conforming changes to the required notice.
   A person who violates Code section 322.19A commits unlawful practice under Code section 714.16. Several types of remedies are available if a court finds that a person has committed an unlawful practice, including injunctive relief, disgorgement of moneys or property, and a civil penalty not to exceed $40,000 per violation.