Oct 2010 Independent Dealer Magazine

since 1940

October 2010

www.FIADA.com

A Publication of the Florida Independent Automobile Dealers Association

Information and Insight for Florida Used Car Dealers

The general election is November 2.

See how the candidates and issues size up starting on Page 13

PERMIT NO. 801 tallahassee, FL

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MAILING ADDRESS 1840 Fiddler Court Tallahassee, FL 32308

TELEPHONE (850) 385-2712 (800) 237-0448

FAX (850) 385-3251 WEBSITE www.FIADA.com

EXECUTIVE COMMITTEE

Greg Edwards President Jim Kagiliery Chairman of the Board Jeff Gann Senior Vice President Jeff Zupec Secretary Dino Mercurio Treasurer

Mario Allmond Regional Vice President Brandi Noegel Regional Vice President George Hickey Regional Vice President Steve Marbais, CMD Regional Vice President John Cousins Regional Vice President

FIADA STAFF

Steve Jordan Executive Director Ginger White Director of Membership Recruitment & Retention Terry Myers Educational Instructor Sarah Langley Membership Coordinator Alex Romans Education Coordinator Christy Taylor Editorial/Advertising

POSTMASTER:

Contents October 2010

For members of the Florida Independent Automobile Dealers Association

C O LU M N S & F E AT U R E S 4

President’s Message Greg Edwards

6

Rob Sickles

8

John Grant, FIADA Lobbyist

10

List of FIADA Endorsed Political Candidates

13

16

22

Recent Court Case Puts Pressure on Phone Calls Legislative Update

FIADA Voter Guide Discover what the actual job descriptions are for Florida’s statewide races and see where the candidates stack up.

Understanding the Proposed Amendments Florida Tax Watch breaks down the details on proposed amendments found on the 2010 ballot.

NIADA Legislative Update Wall Street Reform Bill; Senate Motor Vehicle Safety Act; Small Business Job and Credit Act; Department of Defense

Send address changes to: FIADA • 1840 Fiddler Court Tallahassee, FL 32308 (850) 385-2712 • Toll Free: (800) 237-0448 Fax: (850) 385-3251 • www.FIADA.com The Independent Dealer is a publication of: Florida Independent Automobile Dealers Association, 1840 Fiddler Court, Tallahassee, FL 32308.

The magazine is published every month in Tallahassee and distributed to Florida new, used, wholesale and lease/retail car dealers.

Advertising rates are available upon request.

The statements and opinions expressed herein are those of the individual authors and do not necessarily represent the views of Independent Dealer or the Association.

Likewise, the appearance of advertisers, or their identification as members of FIADA, does not constitute an endorsement of the products or services featured.

www.fiada.com

PAC CONTRIBUTION FORM Use this form to make your contribution, or go online to www.FIADA.com.

CONTRIBUTOR’S NAME: DEALERSHIP: ADDRESS: Make your check out to FIADA-PAC and mail your contribution to: FIADA • 1840 Fiddler Court • Tallahassee, FL 32808 Enclosed is my check for:  $1,000  $500  $250  $100 ______  Monthly Contribution _______ October 2010 — Independent Dealer —

FROM THE PRESIDENT

The Victory Lap

BY GREG ED WARDS

H

ere I am, coming off the final lap of my FIADA presidency and pulling into the winner’s circle. It has been a great year for the Association and I am proud that I have had a small part in achieving some of the really big things we have done. Let’s take a look back at what we got done.

First, we took the Association in a brand new direction when we hired Steve Jordan as the Executive Director.

I relied on Steve quite a bit this past year and at every turn he was there. Under Steve’s direction, the Association has seen new growth in membership, profitability and legislative presence. We started running the Association as a business by measuring outcomes, creating efficiencies and surrounding ourselves with talented staff and valuable partner resources. The result has been a financially sound organization that is prepared to enter the next year focused on enhancing member benefits and services.

The future is bright for FIADA and now, more than ever, it pays to be a member.

The FIADA Legislative Committee got re-energized this past year as Chairman Dino Mercurio and Lobbyist John Grant delivered an intelligent, intense, and interactive legislative agenda. The first order of business was letting lawmakers in Tallahassee know who we are, and we did that through encouraging our members to get involved in the political process.

We resurrected the PAC Committee and started to actively raise money for it. We enlisted our dealers to participate in political campaigns and look for ways to meet their legislators face-to-face and teach them about our industry. Many of you had your first lesson in political activism when you answered our call to contact elected officials and share your support for our groundbreaking piece of legislation: HB 631—the curbstoning bill that will help level the playing field for — Independent Dealer — October 2010

licensed, independent used car dealers.

We helped educate hundreds of dealers through our series of town hall meetings held at auction locations around the state. The FIADA has always been the industry’s leader in dealer training and continuing education and this year we stayed true to our reputation with new opportunities like the town hall meetings, and our recent Annual Convention which boasted the most diverse and comprehensive education courses FIADA has ever offered. You’ll hear more about the convention in the next issue of Independent Dealer, but I can tell you it was an amazing event and if you weren’t there you missed out big time.

Such a significant list of accomplishments could not have happened without some help. Their really are so many people to thank. The 2009-2010 Executive Committee worked extremely hard and were always around to volunteer, answer the call and take on the task. Our Board of Directors who met every quarter to debate questions, run through scenarios and provide valuable insight on the best way FIADA could accomplish its goals. Chairing that group was past president and Chairman of the Board Jim Kagiliery, who is one of the smartest, intuitive and funniest dealers you will ever meet. The FIADA staff was also flawless this year in putting action to the plans and objectives the board set forth. They quietly worked behind-the-scenes, got the job done and executed every task we assigned them with dedication.

Thank you for letting me serve you as president this past year. It has been a wonderful experience and taught me a lot. I look forward to assuming my new role as Chairman of the Board and happily pass the torch to incoming President Jeff Gann. Good luck and good selling! www.fiada.com

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L E G A L U P D AT E

Recent Court Case Puts Pressure on Phone Calls

BY R OB SICKLES

B

y now many of you probably have some familiarity with who I am. I have been the outside general counsel for the Florida Independent Auto Dealers’ Association since 2006 and have been representing both Franchised and Independent Automotive Dealers in Florida since 1999.

After Steve Jordan assumed the leadership responsibilities for FIADA, I was asked to take a more active role in the training being offered by the Association. Initially, I began participating in the training days that were being offered in conjunction with the quarterly FIADA meetings. Overall, the response to the training days was extremely positive and dealers seemed to really appreciate the opportunity to have a lawyer that was experienced with the automotive industry available to answer questions or discuss current issues. During the summer Steve Jordan and the FIADA Board began to contemplate ways that they could improve services and add benefits for FIADA members. Among the initiatives discussed was an effort to try to expanded the scope of FIADA’S technical assistance line to enable it to better serve members.

Recently the FIADA Board approved the expansion of the technical assistance line and I am now actively involved with it on a daily basis. In addition, I have agreed to help keep members apprised of developments or legal issues through periodic contributions to this magazine. To that end, on October 19, 2010 a potentially important court decision was released by the United States District Court for the Southern District of Florida. In Fillichio v. MRS Associates, Inc., a Federal Judge granted summary judgment to a plaintiff that sought recovery — Independent Dealer — October 2010

from a third party that was attempting to collect a consumer debt by placing telephone calls to the consumer. At the time of the underlying transaction, the consumer provided a specific telephone number to the lender, but never authorized telephone calls to be made to her cellular phone. After default the collector was unable to reach the consumer on the number that she provided. The collector then located a different telephone number for the consumer though investigation. This second number turned out to be the consumer’s cellular telephone number, but there was no evidence that the collector knew of this fact.

Between October, 2008 and March, 2009 the collector placed 157 phone calls through an automated dialing device to the cellular telephone number and left 31 messages in an effort to collect the debt. The consumer never responded to any of the messages or answered any calls made to her cellular phone nor did she have caller id on her cellular phone so as to know who was calling.

Despite the fact that the consumer did not respond to the calls and did not become aware that all 157 calls were from the defendant due to her lack of caller id, the court granted a judgment for the plaintiff and awarded the consumer a minimum of $500.00 for each of the 157 calls. This award created a total a minimum Judgment of $78,500.00, plus the plaintiff will also likely be entitled to recover attorney’s fees and costs.

Importantly, the Judge did not find that the collector had violated any collections laws, but rather found that the collector violated the Telephone Consumer Protection Act which prohibits the making of any call, other than a call made for emergency purposes or made with the prior express consent of a party, through the use of any automatic telephone dialing www.fiada.com

system, to any telephone assigned to a cellular telephone service. See 47 U.S.C. § 227 (b)(1)(A)(i)-(iii).

In the case from South Florida, the Judge found that there were undisputed facts that the collector made 157 calls using an automated telephone dialing system to a cellular telephone number. The Judge ruled that these actions violated the statute in question and that as a result, the plaintiff was entitled to recover the statutory minimum of $500.00 in damages for each violation. In addition, the judge indicated that there was a factual question that needed to be resolved by a jury in order to determine whether the violations were willful and knowing.

To the extent that any of the violations is found to be willful and knowing, then the plaintiff will be entitled to $1,500.00 per violation.

Robert E. Sickles is a partner in the Tampa office of Hinshaw & Culbertson LLP focusing his practice on commercial litigation and consumer and class action defense. Mr. Sickles represents over 100 Florida auto dealers and related companies and is the outside general counsel to the Florida Independent Automobile Dealers Association. He can be reached at (813) 868-8838 or via email at rsickles@hinshawlaw.com. www.fiada.com

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Based on this recent case, if you are utilizing an automatic dialer in your collections processes and you do not have your customers’ express consent to contact them via cellular telephone, then you are subjecting yourself to liability of up to $1,500.00 for each call regardless of whether the consumer answers the call or realizes that the call is from you. It does not appear that this decision or the law that it is interpreting would be applicable where the customer listed the cellular telephone number on a credit application or otherwise authorized the contact via cell phone.

October 2010 — Independent Dealer —

L E G I S L AT I V E U P D AT E

The Final Election Stretch

BY HONORABLE JOHN GRANT, FIADA LOBBYIST

I

t’s about that time that occurs every two years when the election process is in high gear and people are trying to decide who to choose to be their elected leaders and representatives. This year, FIADA has been more involved than ever.

The process your Association went through this year to successfully pass our landmark curbstoning legislation showed FIADA members and leaders more than ever the importance of being involved in the election process. We need to help qualified candidates who support our issues and who stand in the gap for small business get elected. We need to help them before we ask them to help us.

This year FIADA members got personally involved in Florida elections. Our Political Action Committee raised funds and endorsed candidates.

We involved local dealers in local races and held fundraisers for various candidates. Our dealers helped in local campaigns and dealer locations proved to be excellent sign locations for our chosen candidates.

We did not endorse in statewide races, but provided opportunities for statewide candidates to meet our members, know who we are and understand our issues.

We did endorse candidates in legislative races. Many candidates, mostly incumbents, were either unopposed or had no major party opposition. Those who did have competitive races received questionnaires from the FIADA Legislative Committee, under the direction of Dino Mercurio and candidate responses were reviewed before our endorsements were made.

We provided financial and other help for our endorsed candidates and most of them, who had primary opposition did well. For many the primary was tantamount to election, as they have no General Election opposition. Of those who do have a November election contest, there are 8 Senate candidates and 53 House candidates endorsed by FIADA on the ballot. Their names and districts appear on page 10 and our members are encouraged to become involved in local campaigns in this last lap around the — Independent Dealer — October 2010

2010 election track. For many your involvement could make a difference. Call your local FIADA endorsed candidates and offer to help in their campaigns.

To emphasize our heightened involvement in the political process, a portion of the recent FIADA convention program included a legislative report and a candidate forum giving attendees an understanding of our political and legislative accomplishments, particularly the landmark legislation passed in the last legislative session.

We also were excited to receive direct attention from some of the candidates seeking statewide office at the first ever FIADA Candidate Forum. Both Senate President Jeff Atwater, who is currently running for CFO, and Senator Dan Gelber, a candidate for Attorney General, addressed convention attendees in person. We also welcomed former Pinellas County Sherrif Everett Rice who was giving his support to Attorney General candidate Pam Bondi.

The Forum closed with a personal video message from gubernoatorial candidate Rick Scott speaking directly to FIADA members.

Only a few days remain before the General Election. Please remember to get involved in campaigns and above all, remember to vote.

Remember that only half of those eligible to register to vote are registered voters. Recent polls show that voter turnout this year will not be high, probably somewhere around forty percent.

Do the math: If half are not registered and only 40% of those who are turn out, that means that only 20% of those who could register and vote will be at the polls and since a majority can determine any election, that means that 10% of the people can decide any race.

Your vote counts more than ever, so be sure to be at the polls. Encourage your family to vote and consider giving your employees time off to vote. Your involvement could make the difference in the outcome of any election. www.fiada.com

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October 2010 — Independent Dealer —

FIADA Endorsed Candidates (District Races)

SENATE DISTRICTS

HOUSE DISTRICTS

10 — Independent Dealer — October 2010

DISTRICT CANDIDATE NAME

SENATE: DISTRICT CANDIDATE 6 Bill Montford 8 John Thrasher 14 Steve Oelrich 16 Jack Latvala 20 Alan Hayes 25 Ellyn Bogdanoff 32 Jeremy Ring 38 Anitere Flores

HOUSE OF REPRESENTATIVES: DISTRICT CANDIDATE 3 Clay Ford 6 Jimmy Patronis 7 Marti Coley 8 Alan Williams 10 Leonard Bembry 11 Elizabeth Porter 18 Ronald Renuart 20 Bill Proctor 22 Keith Perry 24 Dennis Baxley 25 Larry Metz 30 Ritch Workman 31 John Tobia 34 Chris Dorworth 35 Dean Cannon 36 Scott Randolph 40 Eric Eisnaugle 41 Steve Precourt 44 Robert Schenck 47 James Grant 48 Peter Nehr 50 Ed Hooper 51 Janet Long 52 Jeff Brandes 53 Rick Kriseman 54 James Frishe 56 Rachel Burgin 57 Dana Young 60 Shawn Harrison 61 Will Weatherford 64 Kelli Stargel 67 Greg Steube 69 Keith Fitzgerald 70 Doug Holder 71 Ken Roberson 79 Mike Horner 81 Gayle Harrell 83 Pat Rooney 84 Mack Bernard 85 Joseph Abruzzo 86 Lori Berman 87 Bill Hager 90 Irv Slosberg 95 Jim Waldman 98 Franklin Sands 107 Luis Garcia 111 Erik Fresen 112 Jeanette Nunez 113 Carlos Lopez-Cantera 115 Jose Diaz 118 Dwight Bullard 119 Frank Artiles 120 Ron Saunders www.fiada.com

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A

used car dealership is comprised of many different offices and positions. Sales Manager, Parts Manager, Title Clerk all have their unique function and individualized job descriptions. When hiring a new employee, you know that it is important to find the right person with the right skills. You wouldn’t ask someone with limited math skills to be your bookkeeper just as you wouldn’t ask someone without mechanical training to fix your cars.

The same goes for government. Political candidates use the campaign trail as a way to “interview” for the job they seek. They put their best foot forward, offer an impeccable resumé and wait to be hired with your vote. Independent Dealer has compiled a list of job descriptions as outlined by the Florida Constitution for each of the offices that make up the Florida Executive Branch: Governor, Attorney General, Chief Financial Officer and Commissioner of Agriculture. We’ve also given you a resume for each of the candidates seeking those offices. Now, it’s your turn to use your business savvy and hire the candidate you think is most qualified and best suited for the job.

GOVERNOR

Article IV, Section 1 of the Florida Constitution says this about the office of Governor: (a) The supreme executive power shall be vested in a governor, who shall be commander-in-chief of all military forces of the state not in active service of the United States. The governor shall take care that the laws be faithfully executed, commission all officers of the state and counties, and transact all necessary business with the officers of government. The governor may require information in writing from all executive or administrative state, county or municipal officers upon any subject relating to the duties of their respective offices. The governor shall be the chief administrative officer of the state responsible for the planning and budgeting for the state.

Rick Scott (R) Education: Juris Doctorate, Southern Methodist University BS, Business Administration, University of Missouri Professional Experience: Founder, Columbia Hospital Corporation, present Founder, Solantic Corporation, present Attorney, Johnson and Swanson United States Navy Political Experience: No previous political experience Platform: My top priority when elected is to make Florida the number one state in the country for job creation and I will accomplish that through the implementation of my 777 economic plan - 7 Steps to 700,000 Jobs in 7 Years. By reducing regulation, cutting state spending, shrinking state government and eliminating the business tax we will make Florida the obvious choice for businesses looking to relocate and provide an environment that encourages businesses already based in Florida to grow and expand. Floridians want to work and my administration’s top priority will be creating jobs. www.fiada.com

Alex Sink (D) Education: BA, Mathematics, Wake Forest University Professional Experience: State Fire Marshal, State of Florida, 2006-present President, Bank of America Teacher, Mathematics Political Experience: Chief Financial Officer, State of Florida, 2006-present Platform: Getting our state through this recession and coming out stronger and more prosperous on the other side will require a leader with experience in private business whose focus has always been entrepreneurship and problem solving.

Alex Sink has a different vision for our state than the career politicians. With 26 years as a leader in the private sector, she will focus on getting Floridians back to work.

Alex Sink has a record of streamlining government as Florida’s CFO. As Governor, Alex will institute a Florida Performance Score Card to which she will hold state government accountable -- and to which she expects voters to hold her accountable.

Continued on page 14.

October 2010 — Independent Dealer — 13

VOTER GUIDE 2010 Continued from page 13.

ATTORNEY GENERAL

Article IV, Section 4 of the Florida Constitution says this about the office of Attorney General: (b) The attorney general shall be the chief state legal officer. There is created in the office of the attorney general the position of statewide prosecutor. The statewide prosecutor shall have concurrent jurisdiction with the state attorneys to prosecute violations of criminal laws occurring or having occurred, in two or more judicial circuits as part of a related transaction, or when any such offense is affecting or has affected two or more judicial circuits as provided by general law.

The statewide prosecutor shall be appointed by the attorney general from not less than three persons nominated by the judicial nominating commission for the supreme court, or as otherwise provided by general law.

Pam Bondi (R) Education: BS, Criminal Justice, University of Florida, 1987 Juris Doctorate, Stetson Law School, 1990 Professional Experience: Prosecutor Federal Bureau Chief Assistant State Attorney, Florida’s 13th Judicial Circuit Political Experience: No previous political experience

Dan Gelber (D) Education: Juris Doctorate, University of Florida College of Law, 1985 BA, Tufts University, 1982 Professional Experience: Staff Director, United States Senate’s Permanent Subcommittee on Investigations, 1994-1996 Chief Counsel, US Senator Sam Nunn, 1994-1996 Asst. US Attorney, Southern District of Florida, 1986-1994 Political Experience: Senator, Florida Sate Senate, 2008-present Minority Leader, FL House of Representatives, 2006-2008 Representative, FL House of Representatives, 2001-2008

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CHIEF FINANCIAL OFFICER

Article IV, Section 4 of the Florida Constitution says this about the office of Chief Financial Officer: (c) The chief financial officer shall serve as the chief fiscal officer of the state, and shall settle and approve accounts against the state, and shall keep all state funds and securities.

Jeff Atwater (R) Education: MBA, University of Florida, 2002 BA, Finance, University of Florida, 1981 Professional Experience: Chair/President/Chief Executive Officer, Barnett Bank of Broward County, 1996-1998 Chair/President/Chief Executive Officer, Barnett Bank of Treasure Coast, 1994-1996 Political Experience: President, Florida State Senate, 2008-present Senator, Florida State Senate, 2003-present Representative, Florida State House of Representatives, 2000-2002 Vice Mayor, Village of North Palm Beach

Loranne Ausley (D) Education: Juris Doctorate, Washington and Lee University, 1990 BA, Randolph Macon Women’s College, 1985 Professional Experience: Attorney Chief of Staff, Lieutenant Governor Buddy MacKay Business Development Director, United States Department of Housing and Urban Development, Empowerment Zones Initiative (Inner City Economic Development Initiative) Director, United States Department of Housing and Urban Development, National Rebuilding Initiative Political Experience: Representative, Florida State House of Representatives, 2000-present Democratic Co-Floor Leader, Florida State House of

COMMISSIONER OF AGRICULTURE

Article IV, Section 4 of the Florida Constitution says this about the office of Commissioner of Agriculture: (d) The commissioner of agriculture shall have supervision of matters pertaining to agriculture except as otherwise provided by law.

The Commissioner of Agriculture is the head of the Department of Agriculture and Consumer Services. As such, part of the Commissioner’s responsibility is protecting consumers from unfair and deceptive business practices and providing consumer information.

Adam H. Putnam (R) Education: BA, Food and Resource Economics, University of Florida, 1995 Professional Experience: Family Citrus and Cattle Business Farmer Political Experience: Representative, United States House of Representatives, 2001-present Representative, Florida State House of Representatives, 1996-2000

Scott Maddox (D) Education: Juris Doctorate, Florida State College of Law BS, Political Science/ Public Administration, Florida State University Professional Experience: Attorney, Maddox Horne Law Firm Political Experience: Chair, Florida Democratic Party, 2003 President, Florida League of Cities, 1999 Mayor, City of Tallahassee, 1995 City Commissioner, City of Tallahassee, 1993

Information source: Project Vote Smart; votesmart.org www.fiada.com

October 2010 — Independent Dealer — 15

2010 VOTER GUIDE

Understanding the Prosposed Amendments B Y D ominic M . C alabro, C E O, florida ta x watch and K urt W enner , F lorida Ta x Watch D irector of Ta x R esearch

O

n November 2, 2010, Floridians will vote on six proposed amendments to the Florida Constitution. Three of the amendments (1, 2, and 8) were put on the ballot by the Florida Legislature and three amendments (4, 5, and 6) were created through citizen ballot initiatives.

The following analysis on amendments 2, 4 and 8 was prepared by Florida TaxWatch, a private non-profit, non-partisan research institute that acts as a watchdog for citizen’s tax dollars. In each instance there is an explanation of the amendment and background and analysis.

Amendments 1, 2 and 8 relate to campaign finance and redistricting, and are not covered in this analysis because they relate to parts of the political process and out of the scope of the tax watch.

Amendment 2 – Amends Article VII, Sections 3 and 31 Ballot Title: Homestead ad valorem tax credit for deployed military personnel Ballot Summary (as it will appear on the November ballot): Proposing an amendment to the State Constitution to require the Legislature to provide an additional homestead property tax exemption by law for members of the United States military or military reserves, the United States Coast Guard or its reserves, or the Florida National Guard who receive a homestead exemption and were deployed in the previous year on active duty outside the continental United States, Alaska, or Hawaii in support of military operations designated by the Legislature. The exempt amount will be based upon the number of days in the previous calendar year that the person was deployed on active duty outside the continental United States, Alaska, or Hawaii in support of military operations designated by the Legislature. The amendment is scheduled to take effect January 1, 2011.

Background and Analysis: The 2009 Florida Legislature unanimously passed House Joint Resolution 833 to bring a constitutional amendment to the voters to provide an additional property exemption for military personnel. It 16 — Independent Dealer — October 2010

is available to any member of the United States military, the Coast Guard, or the Florida National Guard that was deployed outside the United State as part of their military service for any period in the preceding calendar year. That person must already have the current homestead exemption. The exemption will be a percentage of the home’s taxable value – calculated by dividing the number of days the person was deployed by the number of days in that year. In other words, if deployed for half of the year, the exemption would be 50%. If deployed for the entire year, the exemption would be 100% – meaning no property tax would be due on the homesteaded property.

The exemption would apply to all levies – county, city, school district, and special district.

While a fiscal impact statement is not required for constitutional amendments brought by the Legislature, the state Revenue Estimating Conference (REC) did examine the joint resolution during the 2009 session. Because of many unknown factors, including the number of deployed military personnel in 2012, the REC said the impact would be negative, but indeterminate. However, if the amendment would have been in place during 2009, the REC estimated its impact at $13 million. The average exemption would be worth approximately $1,500 in reduced taxes. According to the REC, approximately 25,525 military personnel who claim Florida as their home of record were deployed overseas on active duty in support of Operation Iraqi Freedom and Operation Enduring Freedom in 2008.

It should be noted that only 58% of Florida resident households qualify for the homestead exemption and this will not give any benefit to soldiers who rent or otherwise do not own a home. It will have the impact of reducing local government revenues or putting upward pressure on millage (tax) rates, but the impact will be minor – the $13 million estimated by the REC is less than five onehundredths of a percent of the state $30 billion in property tax levies. It is also likely the number of Floridians deployed overseas will be less in 2012 than in 2009.

Continued on page 18. www.fiada.com

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October 2010 — Independent Dealer — 17

VOTER GUIDE:PROPOSED AMENDMENTS Continued from page 16.

Conclusion: This property tax exemption would be another wrinkle in Florida’s convoluted and inequitable property tax system; however, it is a small way to reward those serving our country and would be a big help to military families in Florida who own their homes while the impact on other taxpayers would be minimal.

Amendment 4 – Amends Article II, Section 7 Ballot Title: Referenda required for adoption and amendment of local government comprehensive land use plans.

Ballot Summary (as it will appear on the November ballot): Establishes that before a local government may adopt a new comprehensive land use plan, or amend a comprehensive land use plan, the proposed plan or amendment shall be subject to vote of the electors of the local government by referendum, following preparation by the local planning agency, consideration by the governing body and notice. Provides definitions.

Background and Analysis: Amendment 4 would require that local voters approve changes to their local comprehensive plans. These plans are the growth management plans that cities and counties use to outline the specifics of future development. Currently, these plans can be amended by elected local officials voting to make changes. However, if the Amendment 4 passes, all changes to comprehensive plans would go before the voters – either in a special election or proposed changes could be added to the ballot during a scheduled regular election.

One of the issues with the amendment is whether such a system is even practical. Florida cities and counties make approximately 8,000 changes to their comprehensive plans annually. There is debate as to how many separate ballot questions this would entail. Opponents say that all changes would have to be voted on as single issues, requiring local governments to hold dozens of special elections or develop huge ballots that could overwhelm voters. Supporters say changes could be grouped together and the number of needed elections would not be cumbersome.

Amendment 4 would undoubtedly require additional elections. The state’s Financial Impact Estimating Conference (FIEC), which is required by law to develop an economic impact statement on amendments brought to the ballot by citizen initiative, says that how many elections would result is unknown but elections are expensive. The FIEC states that the minimum cost per special election for an average-sized county ranges from $143,300 to $287,700; for an average-sized city from $10,500 to $22,000. The cost for just one extra election for each voter in the state would range from $10 million and $20 million. This taxpayer funded expense could severely impact cash-strapped local governments.

18 — Independent Dealer — October 2010

Florida TaxWatch has long warned against “hyperdemocracy” and its threat to our republic form of government. The current process to amend comp plans is already accessible and open to the public. The voters can hold elected officials responsible for their actions in amending comprehensive plans. Even if practical, is Amendment 4 necessary? Land use decisions are often complex. Does the average voter have the expertise to be the final say on the decision, or should that reside with the officials the voters elected to represent them? Elections would also provide the opportunity for well-financed campaigns to have undue influence over these decisions.

The most important question over Amendment 4 is its effect on our economy. There is a general consensus in the business community that the amendment would have a chilling impact on development in our state, which would in turn have a chilling impact on jobs and Florida’s economy.

Florida TaxWatch is currently conducting research to quantify the potential fiscal impact of Amendment 4. That study will be released soon but our preliminary findings indicate the amendment would have serious long term negative impacts on our economy.

Conclusion: Amendment 4’s envisioned restructuring of property rights from private to public and the associated change in decision-making from the marketplace to the ballot box will likely have devastating, lasting effects on Florida’s economy, the taxpayers, and the treasuries of cities and counties throughout or state. Amendment 4, should it be enacted, will introduce a large and consistent bias against voter approval of new projects as has been demonstrated in similar situations. As a result, commercial and residential investments as well as business formations and expansions will diminish. Higher costs will emerge for approved commercial and residential investments as well as forming new businesses and expanding existing ones. Special interest groups might arise and be funded in attempts to convince a large number of people to vote for or against a given project.

Funding special interest groups would further add to the cost of development. Moreover, permanent increases in the direct and indirect costs of elections will occur. Overall, the successful passage of Amendment 4 would be expensive for Florida taxpayers and could be devastating for Florida’s economy.

Amendment 8 – Amends Article IX, Section 1 and Article VII, Section 31 Ballot Title: Revision of the class size requirements for public schools.

Ballot Summary (as it will appear on the November ballot): The Florida Constitution currently limits the

Continued on page 20. www.fiada.com

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VOTER GUIDE:PROPOSED AMENDMENTS Continued from page 16.

maximum number of students assigned to each teacher in public school classrooms in the following grade groupings: for prekindergarten through grade 3, 18 students; for grades 4 through 8, 22 students; and for grades 9 through 12, 25 students. Under this amendment, the current limits on the maximum number of students assigned to each teacher in public school classrooms would become limits on the average number of students assigned per class to each teacher, by specified grade grouping, in each public school. This amendment also adopts new limits on the maximum number of students assigned to each teacher in an individual classroom as follows: for prekindergarten through grade 3, 21 students; for grades 4 through 8, 27 students; and for grades 9 through 12, 30 students. This amendment specifies that class size limits do not apply to virtual classes, requires the Legislature to provide sufficient funds to maintain the average number of students required by this amendment, and schedules these revisions to take effect upon approval by the electors of this state and to operate retroactively to the beginning of the 2010-2011 school year.

Background and Analysis: In 2002, the Florida Constitution was amended to mandate a reduction in the size of classes throughout Florida’s K-12 public schools.

The Class Size Reduction Amendment (CSR) phased in the limits described above over a 10-year period, with the allowable maximum number of students per class decreasing by two students annually. Full implementation is due in this academic year (2010-11). The compliance standards also got tougher – class size averages were initially measured at the district level, then the school level. This year calls for measurement at the individual class level. School districts are subject to accountability standards that levy monetary penalties for districts that are not in full compliance with the mandated classroom reduction each year.

The phased-in implementation of the CSR has cost the taxpayers billions since its passage in 2002. Since CSR was implemented (in FY 2003-04) through the current fiscal year (FY 2010-11), the state has appropriated $18.7 billion for operating expenditures and fixed capital outlay to comply with the requirements. Also, the state is now paying approximately $150 million a year for debt service on the bonds issued for those schools. For FY 2010-11, the Legislature appropriated $2.9 billion for operating expenses related to class-size reduction – a figure that is more than one-fifth of the current $14 billion budget for K-12 in the state of Florida.

Implementation of class-size is about to get even more expensive. Under current law, class-size is measured at the school average, but is slated to go to the classroom level next year – meaning every core-curriculum class in Florida must meet the class-size limits. There are 4,044 public schools in Florida, but more than 730,000 classrooms. Add the fact 20 — Independent Dealer — October 2010

that after several years of decline, public school enrollments are rising again; meeting this standard will be quite difficult, and quite costly.

While supporters of the original CSR asserted that reducing class sizes lead to improved learning outcomes, there is little empirical evidence in Florida or elsewhere to support the claim. Given the high cost of compliance, there have been calls to modify the CSR requirements and give more flexibility to local school officials. The 2010 Legislature passed Senate Joint Resolution 2 (which became Amendment 8) to bring this modification before the voters.

Surprisingly, there has been little official work done on estimating future costs of the current class-size amendment but, without change, it will undoubtedly grow bigger and bigger. The state is very close to full compliance at the school level – 98% at grades K-3 and 99% at grades 412. However, analysis by Legislative staff in March 2010 states that 235,000 (32%) classrooms in Florida exceed the standard.

A report by Florida TaxWatch estimated that, if unchanged, CSR could cost the state $40 billion in operational costs alone over the next ten years. This estimate does not even include fixed capital outlay for the building of new classrooms, which would surely be needed to comply with the original CSR requirements and would likely add billions of dollars to the projected costs. The report estimates Amendment 8 could save between $350 million and $1 billion annually.

Some opponents of Amendment 8 have claimed it would reduce funding the public schools. This should not be the case. The Legislature’s standard for their commitment to funding education is per-student spending and lawmakers do not want to see that number go down. Instead the savings from the amendment can be redirected into other areas that may have a better impact on student achievement and teacher performance.

Conclusion: Future projected spending on compliance with the original CSR requirements is much too high, both in terms of its small return on investment and the state’s current budget outlook. Based on reasonable assumptions, Florida TaxWatch analysts estimate that Amendment 8 has the potential to save $7 billion – $10 billion in CSR compliance costs over the next ten years, money that could be used to fund a variety of critical services related to education, including funding a merit pay program, professional training for teachers, and new materials for classrooms. Although Amendment 8 is no panacea – and outright repeal of the CSR is neither popular nor prudent given the amount already invested by Florida taxpayers – modifying the CSR requirements will provide the flexibility to reduce implementation costs and the balance to ensure our class sizes are reasonable, while freeing up money that can be used to better impact student achievement. www.fiada.com

N I A D A U P D AT E

The Wall Street Reform Bill and Progress On Auto Dealer Requirements B Y federal advocates , N I A D A Lobbyist group

T

he NIADA has been working hard to represent members on recent legislation that directly effect auto dealers. Following is a report from NIADA on recent meetings with federal departments and the status of proposed and enacted legislation.

“Wall Street/Consumer” Financial Services Reform Bill On July 22, President Obama signed into law the “Wall Street Reform Bill.” As reported previously, the new law exempts certain auto dealers from increased oversight with respect to dealer-assisted financing. To get to that result, NIADA participated in advocacy activities over the past month included numerous meetings, strategy phone conference calls, letters, talking points, and legislative alerts.

The law does grant increased powers to the FTC regarding dealer oversight. Also, it requires coordination with the Department of Defense to ensure that Service Members and their families are treated fairly by automobile dealers.

On September 21, Keith Whann and Federal Advocates met with staff of the FCC regarding implementation of the “Wall Street/ Consumer” Financial Services Reform Bill and its impact on the auto industry. Following discussion led by Keith Whann of various issues including topics surrounding BuyHere Pay-Here businesses, Whann answered various questions as to Keith Whann how the auto industry segments work, including the auto auction process. It was decided to schedule another half day session in the following weeks to allow for a more detailed discussion of the issues.

Senate Motor Vehicle Safety Act of 2010 On June 9, 2010, the Senate Committee on Commerce, Science and Transportation marked up an order reported S.3302, the so-called “Toyota Bill.” In earlier drafts of the Bill and just prior to markup, language was included (section 310) which would have specified that a dealer may not sell or lease a used passenger motor vehicle (both wholesale and retail sales) until the dealer first notifies the www.fiada.com

purchaser or lessee in writing of any recall notices. Working primarily with Senator Thune and his staff, and the Senate Committee staff, Keith Whann’s proposed suggestion was accepted and language was included in the final reported version of the bill exempting wholesale transactions from the section’s application. While this is an initial “victory,” the remaining provision is still very troublesome and NIADA will continue to advocate on behalf of dealer’s interest pending further action on the Senate Bill and/or on a House companion bill. The latest Senate draft and the companion House bill (H.R. 5381) are currently being reviewed by NIADA. Small Business Jobs and Credit Act of 2010 On September 23, the House passed the Senatepassed bill, which includes an increase in the amount that the Small Business Administration’s Dealer Floor Plan Financing program can guarantee. This permits the SBA to guarantee bank and finance company loans up to $5 million, which should help, the Committee believes, expand dealer access to floorplan lines of credit. NIADA worked with Senator Landrieu’s Committee and personal staff, in conjunction with others, on this. This bill may be the subject of subsequent meetings with the Hill and the SBA on how the program “really works.”

Department of Defense Regarding the issue of “how to ensure that service members and their families are treated fairly by automobile dealers,” under the new Consumer Financial Protection Bureau, Keith Whann and Federal Advocates also met on September 21 with Frank Emery, Office of Personal Finance, Family Policy Outreach Directorate, U.S. Department of Defense. Keith relayed a specific example of how he helped a service member at Fort Bragg, NC, with an automobile situation, working with the base JAG office and others. He also talked about a plan for a special program to “teach” dealers on how to deal fairly with service members and their families. Emery mentioned a November conference in Denver where Keith could give a presentation. Details are to be finalized at a later date.

October 2010 — Independent Dealer — 21

When You Need Help, Call the FIADA Executive Committee Take advantage of the FIADA mentoring program. Use this list of current officers as a directory. When you need help, these are the guys to call.

PRESIDENT Greg Edwards Greg Edwards Enterprises 833 W. International Speedway Dr. Daytona Beach, FL 32114 (386) 323-1888

CHAIRMAN OF THE BOARD Jim Kagiliery Car Now Acceptance Company 5022 Gate Parkway, Ste. 208 Jacksonville, FL 32256 (904) 338-9194

Senior Vice President

Jeff Gann Lakeshore Motors P.O. Box 63 East Lake Weir, FL 32183 (352) 288-4512

TREASURER

Dino Mercurio Independent Credit, Inc. 2008 Okeechobee Boulevard West Palm Beach, FL 33409 (561) 686-8673

SECRETARY

Jeff Zupec Insurance Auto Auction 151 West Taft Vineland Road Orlando, FL 32824-6507 (407) 438-7191

Regional Vice President Regional Vice President Regional Vice President Regional Vice President Regional Vice President John Cousins Southeast Car Agency 310 N.E. 39th Avenue Gainesville, FL 32609 (352) 377-7787

George Hickey Bond Auto Sales, Inc. 7901 Florida Avenue Tampa, FL 34761 (813) 238-7478

Steve Marbais Marbais Enterprises, Inc. 1207 North Lakewood Avenue Ocoee, FL 34761 (407) 877-7422

Brandi Noegel Noegel’s Auto Sales 1018 North Temple Avenue Starke, FL 32091 (904) 964-6461

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Mario Allmond Your Auction, Inc. 3010 Scherer Drive North St. Petersburg, FL 33716 (727) 572-8800

22 — Independent Dealer — October 2010

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