In This Issue: –B lake Ingram Named 2014 Texas Quality Dealer of the Year –T IADA Annual Conference and Expo Wrap-Up – Michael W. Dunagan on Sending Repossession Notices – Taxability Issues on Service Contracts and Repairs
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2015 TIADA Board of Directors President Brent Rhodes/Fiesta Motors 5150 Industrial Way Drive Buda, TX 78610 Office: 512.312.2201 Email: brent@fiestamotors.net chairman of the board Michael Thomasson/Mike Carlson Motor Company 264 Exchange St. Burleson, TX 76028 Office: 817.366.9578 Email: mthomasson@mcmcauto.com President Elect HL Hensley/Automax of Lubbock 1908 Avenue J Lubbock, Texas 79411 Office: 806.744.3533 Email: hl@gospac.com Secretary Kathrine Tolsch/CICO Auto Sales 11050 Harry Hines Blvd. Dallas, TX 75229 Office: 214.352.9282 Email: cicoauto@verizon.net Treasurer Greg Zak/Dixon Motors 7902 North Freeway Houston, TX 77037 Office: 281.931.1300 Email: gzak@windstream.net Vice President, West Texas (Region 1) James Hobson/H-Town Motors 3714 Dyer Street El Paso TX 79930 Office: 915.564.9797 Email: htownmotors@sbcglobal.net Vice President, Fort Worth (Region 2) Tommy Gregory/Abilene Used Cars Sales Inc. 497 E.S. 11th Abilene, TX 79602 Office: 325.676.8000 Email: aucsinc@sbcglobal.net Vice President, Dallas (Region 3) Kevin Mims/VP Auto Sales 2921 S. Garland Ave. Garland, TX 75041 Office: 972.864.1300 Email: kevinm@vpautosales.com Vice President, Houston (Region 4) Juan Sabillon/Mi Tierra Auto Sales 7935 Gulf Freeway Houston, TX 77017 Office: 713.644.2446 Email: brentfordct@yahoo.com Vice President, Central Texas (Region 5) Robert Beck/Stop N’Drive Motors 711 N. General McMullen Dr. San Antonio, TX 78228 Office: 210.432.1101 Email: stopdrive@texas.net Vice President, South Texas (Region 6) Dan Keetch/Keetch Motors 1010 S. Staples Corpus Christi, TX 78404 Office: 361.882.3541 Email: dankeetch51@yahoo.com Vice President At Large Ryan Winkelmann/BJ’s Autohaus 5005 Telephone Road Houston, TX 77087 Office: 713.641.0980 Email: ryan.winkelmann@sbcglobal.net Vice President At Large Trey Crouch/Trey Crouch’s Wheels On Credit 636 E. Business 83 McAllen TX 78501 Office: 956.972.0700 Email: trey@wheelsoncredit.com TIADA Executive Director Jeff Martin 9951 Anderson Mill Rd., Suite 101 Austin, TX 78750 Office Hours M-F 8:30am - 4:30pm 800.442.5944 • Fax 512.244.6218 jeff.martin@txiada.com
Volume XIV
/
Issue 9
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S e p t e m b e r 2 014
texasDealer
5 Officers’ Message
contents
by Greg Zak, TIADA Treasurer
7 On The Cover: TIADA Welcomes 2015 State President, Brent Rhodes Compiled by Texas Dealer staff
11 Legal Corner: Do Notices Have to Be Sent by Certified Mail? by Michael W. Dunagan
12 Upcoming Events 14 Board of Directors Meeting Minutes 16 News & Notes 18 Taxability Issues on Service Contracts and Repairs Provided by the office of the Texas Comptroller
22 Local Chapters 22 2014 Auto Auction Directory & Resource Guide 24 TIADA Annual Conference Wrap-Up by Jenny Kroening
30 Blake Ingram Named 2014 Texas Quality Dealer of the Year 36 Gamification is on the Rise — Why Your Dealership Should Think Twice by Adam Hollander
38 New Members 42 Regulation Matters: Looking Ahead to a “Single Sticker” World by Danny Langfield
46 Behind the Wheel by Jeff Martin
What’s happening at w w w . t x i a d a . c o m ?
DID YOU KNOW... the fall education schedule has been announced? Visit Education/TIADA Dealer Academy Offerings for the listing of education sessions being offered September through December. The Editor of the Texas Dealer magazine is Jenny Kroening, Special Projects Director of TIADA. To change your address for subscription and/or for other TIADA products, call the TIADA state office at 800.442.5944, 512.244.6060 or fax 512.244.6218. E-mail: info@txiada.com. New Membership/Subscriptions: If you are a member of TIADA, you may receive this magazine free of charge. Membership year runs from Jan 1 to Dec 31. Back issues are available for $20 each subject to availability. Send a check or money order, along with your name and mailing address to TEXAS DEALER, Attn: Back Issues, 9951 Anderson Mill Rd., Suite 101, Austin, TX 78750. Sorry, no billing. Notice to all members concerning services and products: TIADA was established in 1944 to develop professional standards of service and conduct for the independent auto industry. Opinions expressed herein are not necessarily those of the TIADA management, the Board of Directors or the membership. Likewise, the appearance of advertisers or their indemnifications of TIADA does not constitute endorsement of the products or services featured.
officers’ message My 2014 Conference Takeaways
W
ell, another conference is in the history books and it was certainly one to remember. The TIADA staff continues to outdo themselves. Just when you think you’ve experienced the best TIADA conference ever, the next one is even better. For all of you out there who did not attend, I want to tell you what you missed. One-on-one dealer interaction with some of the top dealers from around the state and other parts of the country Individual training from TxDMV on the new webDealer online title transfer system Hands-on training from the auction explaining all of the various issues regarding frame damage on vehicles Your chance to decide TIADA’s next legislative agenda with the Texas Legislature Roundtable discussions covering nearly every topic you can think of related to your dealership Interaction with OCCC Commissioner, Leslie Pettijohn I attend many conferences throughout the year but, to me, the TIADA Annual Conference and Expo is the most valuable. Don’t get me wrong, many of the national conferences are outstanding and I attend them regularly. But as a Texas dealer, I want to attend a conference where I can learn about issues specific
by Greg
Zak
Dixon Motors (Houston) TIADA treasurer
I attend many conferences throughout the year, but to me, the TIADA Annual Conference and Expo is the most valuable. to Texas and get help and ask questions from the state agencies that are going to examine my dealership. I was able to accomplish all of that in one stop at the TIADA conference. One session I made sure to attend this year was the National Dealer Panel, where successful dealers from around the country shared ideas and strategies that have worked for them. It was interesting to learn how one specific dealer might handle a problem or implement a model differently than another dealer. What I realized is that there usually isn’t a right or wrong way to do something, but hearing about the different
Just when you think you’ve experienced the best TIADA conference ever, the next one is even better. September 2014
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approaches gave me ideas of things I might do differently at my dealership. I always talk about the things I learn at the breakout sessions and the roundtable discussions, but I also had some great takeaways from the keynote speakers. They were outstanding. The opening general session speaker, Jonathan Sprinkles, is a nationally recognized speaker and trainer. He made many points during his presentation that I jotted down, but one of his points really resonated with me. He said, “Stop selling and start connecting.” I realized that this simple statement can be applied to every aspect of your dealership. Don’t think of this only in terms of sales, but think of this from the standpoint of how your collections department interacts with customers, how you interact with your employees, and how your entire staff interacts with anyone who walks onto your dealership. If we would focus more on making connections, we would have fewer problems. I’m going to work on that moving forward and encourage you to give it some thought for your dealership. The other keynote speaker was David Walsh. I have heard David speak many times and he always offers
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valuable advice. David speaks on sales, collections, and leadership. David, like Jonathan, made one particular statement that really stuck out to me. He said, “You always get what you prepare for.” As a business owner or manager, if you don’t prepare, you’ll get exactly what you prepared for… which is “NOTHING.” If we don’t prepare and train our employees, how can we expect them to be successful in their job? As much as I enjoyed the conference for the education and the time I had to connect with other dealers, I have to mention the venue and the little “extras” that made this conference special. I had the chance to hear live Austin music, eat great food from local food trucks, enjoy s’mores right off the fire, and experience the beautiful hill country area. There is one takeaway I want to share that tops all of the others I mentioned earlier: Clear your calendar for August 9–12, 2015. That’s the date of the next TIADA Annual Conference and Expo, which will be held at the JW Marriott in San Antonio, Texas. You don’t want to be the one reading someone else’s recap of the event next year. You want to be the one experiencing it for yourself. See you there!
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on the cover TIADA Welcomes 2015 State President
Brent Rhodes
Brent, donning his trivia contest medal at the 2010 TIADA conference.
Compiled by Texas Dealer Staff
B
rent Rhodes of Fiesta Motors in Buda was elected TIADA state president at the 2014 House of Delegates meeting in Lost Pines, Texas on July 29. Brent has been actively involved in TIADA for several years, serving on the board as region vicepresident, treasurer, secretary and president-elect prior to becoming the president. Texas Dealer visited with Brent to learn more about his background and his thoughts for the future of TIADA.
Tell us about your personal history — where you grew up, family, education, other ventures, etc.
I grew up in Austin where my dad, Dusty Rhodes, owned Metro Auto Auction, the original dealer auto auction in Austin. I grew up washing and parking cars for the auction, which was on Monday nights at that time. I went to Abilene Christian University where I met my wonderful wife, Jessica, and graduated with a Bachelor’s degree in Education and a Master’s degree in Administration. We have two great kids. My daughter Kendall is 14 and my son Caleb is 11. Most of my free time is spent at various sports activities for our kids.
How did you get into the car business?
In 2000, my wife Jessica and I were living in Denver, Colorado where I was working in sports marketing. My brother Gary had just started in the BHPH business after many years in retail. He asked me to join him in running that operation.
How did you first get involved with TIADA? Shortly after I got in this business, I met many successful dealers who were members of TIADA. I realized
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that part of their success was being involved with TIADA. I started attending the various education seminars offered and went to the annual conference as well. My first involvement came when I was asked to serve on a TIADA committee.
What would summarize your personal business philosophy?
My personal business philosophy hinges around superior customer service. In this business, customer service is usually the only thing that really separates you from
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your competition. Customers will continue to buy cars from someone they like and trust.
Who has influenced you as a car dealer?
First of all, maintaining a close relationship with God has been my greatest influence! Next, my dad, Dusty, has been the biggest influence in my life, both personally and in business. I have learned most all of my business traits from watching him over the years. I have also been influenced by many car dealers I’ve met through TIADA. I have had the pleasure of serving with many of them on past TIADA boards. Dealers like Gary Sayre, Blake Ingram, Keith Hagler and Michael Thomasson have been a true blessing to know.
Why did you decide to run for President of TIADA?
I decided to run for president to continue the journey that started seven years ago when I was asked to serve on the TIADA board as a Regional Vice President. It has been a great honor to serve this great association.
What is your greatest concern for the upcoming year?
Since we are entering a legislative year, my greatest concern stems from the surprises that pop up, usually at the 11th hour. Many issues arise in the legislative session that could have a detrimental effect on our industry. We have great systems in place to monitor these issues, but it takes people to assist in this endeavor. We need more people at the grassroots level to get involved and affect positive outcomes for our industry.
What do you think the role of TIADA should be?
I think TIADA’s role can be summed up in two words: Advocacy and Education. TIADA should always be the driving force in both of these areas! Advocacy involves representing the collective interests of independent dealers with the various state agencies and state legislators. The collective clout of TIADA and its members enables independent dealers to speak with one strong, unified voice. With education, TIADA works hard to keep the dealer upto-date on the latest compliance
issues, regulatory changes and best practices. I’m proud to say that I think TIADA is doing a great job in both areas.
Where do you see the future of TIADA?
I think the future of TIADA is strong. We have a great staff that runs the day-to-day operations with excellence. We have a fantastic board that leads the vision for the association. And we have a growing membership base that helps strengthen the influence we have in this state.
Other thoughts you’d like to share?
My challenge for each of you reading this article is to get more involved with TIADA. You can recruit at least one new member this year, attend your local chapter meetings, attend the various TIADA education offerings, join us for Lobby Day at the Capitol on January 27, 2015, or you can contribute money to INDEPAC. There are many opportunities for you! We need your help. Our industry depends on it.
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956.461.9000 T e x a s
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legal corner
Do Notices Have to Be Sent by Certified Mail? by Michael
Dealer Question: The cost of
sending notices by certified mail: return receipt requested has gone up tremendously in recent years. Do I have to send post-repossession notices by certified mail? Answer: No, but you might want to do so anyway, despite the cost.
M
ost states have adopted the Uniform Commercial Code’s provisions regarding repossession of secured property. The Texas repossession provisions appear in the Business and Commerce Code under the heading Uniform Commercial Code — Secured Transactions. Prior to 2001, the relevant provision of the UCC required the creditor to “send notice” to the debtor after a repossession, but before disposition of the collateral. The phrase “send notice” had been generally held to mean the delivery of written notice, but some courts had accepted verbal notice that was acknowledged by the debtor. Despite an occasional liberal interpretation, most court rulings required creditors, when disputes arose, to prove that written notice had been delivered. In the earlier versions of my book, Texas Automobile Repossession: A Lien Holder’s Legal Guide, I suggested that the repossession notices should be sent via
certified mail, with return receipt requested. The latest editions do, also. When the secured transactions sections of the UCC were re-written in 2001, the notice requirement language was changed to require the secured party to send “a reasonable authenticated notification of disposition…” It would be very difficult, if not impossible, to now justify the adequacy of oral notification. A written notice could also be hand delivered to the debtor’s residence,
...the postal receipt has been universally accepted by courts as proof that the notice was sent. Without a postal receipt, the creditor is open to a factual challenge that the notice was never sent.
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or even handed to the debtor in person. A written record, with a copy of the notice, should be placed in the file verifying the date, time and method of notification. The creditor’s obligation has always been, and still is, to send the notice to the debtors’ last known
W. Dunagan
TIADA general counsel
address. There has never been a requirement on the creditor to see that the notice was actually received or read. The green postal receipt card thus eliminated most debtor challenges to the adequacy of how notice was sent. If the mail was signed for by the debtor, there was direct proof of receipt. If the debtor ignored the certified mail delivery notices, or simply refused to sign for the letter, the record was also clear that the creditor had met his or her obligations. While neither the prior law, nor the post-2001 law specifically requires a secured party to send notice by certified mail, the postal receipt has been universally accepted by courts as proof that the notice was sent. Without a postal receipt, the creditor is open to a factual challenge that the notice was never sent. Being able to prove when the notice was sent (that is, delivered to the U.S. postal service with appropriate postage) is often as important as proving that notice was sent. The issue of when notice was sent was raised in a bankruptcy case we were recently handling for a dealer. The dealer had sent notice of a private sale to the debtor’s last known address by certified mail immediately after the repossession. During the 10-day waiting period, he received an offer on the vehicle. 11
Upcoming Events TIADA Dealer Academy September 2014 8 Dealer 101: Nobody Told Me That! DoubleTree by Hilton Hotel Dallas Market Center 2015 Market Center Blvd. Dallas, TX 75207 214.741.7481 Online registration available at www.txiada.com
October 2014 27 Keeping Your Dealership
Legal & Compliant DoubleTree by Hilton Houston Hobby Airport 8181 Airport Blvd. / Houston, TX 77061 713.645.3000 Online registration available at www.txiada.com
November 2014 10 Dealer 101: Nobody Told Me That!
Crowne Plaza Austin 6121 North IH-35 / Austin, TX 78752 512.323.5466 Online registration available at www.txiada.com
19 Better BHPH Financials: How to Get Organized for Growth DoubleTree by Hilton Hotel Dallas Market Center 2015 Market Center Blvd. Dallas, TX 75207 214.741.7481 Online registration available at www.txiada.com 12
20 Better BHPH Financials: How to Get Organized for Growth Hilton San Antonio Airport Hotel 611 N.W. Loop 410 San Antonio, TX 78216 210.377.4601 Online registration available at www.txiada.com December 2014 8 Keeping Your Dealership Legal & Compliant DoubleTree by Hilton Hotel Dallas Market Center 2015 Market Center Blvd. Dallas, TX 75207 214.741.7481 Online registration available at www.txiada.com
Other TIADA Events October 2014 6 TIADA Board of Directors
Meeting Austin, Texas
The first thing the morning of the eleventh day, the dealer closed on the sale of the vehicle. An hour later, he received notice that the prior debtor had filed bankruptcy and demand was made for return of the vehicle. Because we had the postal receipt card proving that notice was sent, and when it was sent, we were able to convince the bankruptcy judge that the vehicle had been legally resold prior to the filing of the bankruptcy, and was thus not subject to the bankruptcy. A similar result would occur when a dealer chooses to send notice of strict foreclosure. When the 20-day waiting period after sending the notice of strict foreclosure expires, the repossessed vehicle reverts to the ownership of the lien holder, and the debtor’s right to possession is cut off. The key is being able to prove when the notice was sent. We’ve handled a case where the bankruptcy was filed more than 20 days after the strict foreclosure notice was sent. When our client refused the demand of the debtor’s attorney to return the vehicle, the debtor filed an adversary action in the bankruptcy court. After he was shown proof of the sending of the strict foreclosure, the judge agreed with our client’s position that the court didn’t have jurisdiction over the repossessed unit and was thus not required to return it. After a series of price increases for the certified mail and postal receipt process by the U.S. Postal Service, many car creditors have re-evaluated the cost effectiveness of sending all their notices this way. And because most repossessions don’t result in a legal challenge about whether or when the notice was sent, many car creditors are questioning whether the extra cost is worth it. A recent trial in which our firm represented another dealer who was accused of a wrongful repossession illustrates how the method T e x a s
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of sending notice can become an issue. The dealer had sent the postrepossession notice by regular first class mail. A copy of the letter, reflecting that the notice was sent to the debtor’s last known address, was kept in the file. In his suit, however, the debtor claimed that he never received the notice, and accused the dealer of not sending notice before re-selling the vehicle. At the trial, the dealer testified as to the company’s procedure in handling repossessions. He testified that notice letters are printed out from the dealer’s software program, that envelopes are addressed, and the letter deposited in the mail. Debtor’s counsel attempted to dispute the dealer’s testimony by emphasizing that the dealer himself did not actually deposit the letter with the post office. In effect, the lack of a postal
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receipt card created a factual dispute about whether the notice was actually sent. Fortunately, the judge found that the dealer’s testimony was credible, and the
record-keeping process was sufficient to establish to his satisfaction that the notice had been sent. The presence of a postal-receipt card would have, however, effectively removed the possibility that the judge could have found the other way. Even if a car creditor decides that the extra cost of sending notice by certified mail is too much, he
should at least consider bearing the expense in those cases where some trouble is anticipated. There are now some less costly means of having out-going mail recorded by the post office, so that a government record, admissible in court, exists. If a secured creditor is not sending notice letters by certified mail, or is contemplating dropping the expense of certified mail, these alternatives should be considered. Contact your local post office for more details. Michael W. Dunagan is an attorney in Dallas, Texas who has represented the Texas Independent Automobile Dealers Association for over 35 years. He has written a number of books and hundreds of articles for trade journals and law reviews. His clientele includes dealers, banks, finance companies, auto auctions and credit unions.
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board of directors meeting minutes July 27, 2014 | Lost Pines, TX Hyatt Lost Pines Resort & Spa
compiled by Texas Dealer staff
At its meeting held on Sunday, July 27, 2014 TIADA heard reports and took the following actions: President Michael Thomasson called the meeting to order at 1:03 p.m.
Michael Thomasson presented the President’s report where he: Provided an update on the business partner program Shared highlights of the NIADA conference
Minutes Of Last Meeting
Executive Director’s Report
Secretary HL Hensley presented the minutes of the last Board of Directors meeting A motion was made to accept the minutes. Moved by Greg Zak, seconded by Tommy Gregory
Treasurer’s Report
Treasurer Kathrine Tolsch presented the Treasurer’s report A motion was made to accept the Treasurer’s report Moved by Brent Rhodes, seconded by Trey Crouch
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14
President’s Report
Jeff Martin presented the Executive Director report where he: Presented the Bylaws, Legislative and Awards committee reports Provided a summary of a fundraising event for the speaker of the house Provided an update on the TAC conference Provided an update on the dealer education initiative Kathrine Tolsch presented the current budget for FY14. Kathrine Tolsch presented the proposed budget for FY15. Jeff Martin reviewed the events and schedule for the 2014 Annual Conference and Expo. Jenny Kroening provided an overview of the completed TIADA membership survey.
Old Business None
New Business
A motion was made to accept the proposed FY15 budget Moved by Byron Riley and seconded by HL Hensley A motion was made to adjourn the meeting. Moved by Kathrine Tolsch, seconded by James Hobson Meeting adjourned at 2:50p.m. Respectfully submitted, HL Hensley, Secretary A complete copy of any reports referenced in this document and more detailed notes from the meeting are on file at the TIADA office and available upon request. T e x a s
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news & notes
Happenings in the Industry…
compiled by Texas Dealer staff
Manheim Wholesale Institute in San Antonio
M
anheim will be offering “The Wholesale Institute,” an interactive workshop designed to teach dealers everything they need to know to start buying and selling wholesale inventory successfully. Workshop will include: Q&A sessions D eep dive on condition reports Tips on successful buying and selling online Breakout for Manheim mobile experts C omplimentary breakfast and lunch
The event will be held at Manheim San Antonio, September 12 from 10 a.m. – 2:30 p.m. Event information and registration is available at http://twi. manheimresources.com/manheim-sanantonio/.
Manheim Manheim DFW Dallas Manheim Manheim El Paso San Antonio Manheim Manheim Houston Texas Hobby San Antonio Austin
Dallas Houston
The 2014
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Join TIADA Today.
AutoStar Conference to Feature Mike Dunagan
TIADA general counsel Mike Dunagan will be a co-keynote presenter at Innovate 2014, the AutoStar Industry Conference to be held at the Gaylord Texan September 21-24 in Grapevine, Texas. Complete event information and registration is available at www.dealershipconference.com.
New VTR Director Selected
The Texas Department of Motor Vehicles (TxDMV) recently selected Jeremiah Kuntz as the new director of the Vehicle Titles and Registration Division (VTR). Kuntz had been serving as the director of the Government and Strategic Communications Division which he created when he joined the agency in 2011. Kuntz came to the TxDMV with a strong background in public service, having worked for the Office of the Governor of Texas, the Texas Department of Transportation and the Texas Senate. He also served six years in the United States Marine Corps Reserve. He received a bachelor of business degree in finance from Southwest Texas University in San Marcos. VTR is responsible for vehicle titling, registration and issuing license plates and disabled placards. It oversees 16 regional service centers and provides policy and procedural support to the 254 county tax assessor-collectors who process registration and title T e x a s
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applications throughout Texas. The division also updates and maintains the state motor vehicle database. Currently, there are more than 23 million registered vehicles in Texas.
Toll Tag Dealer Info from NTTA
The following information was received from the North Texas Toll Authority: Help your dealership avoid the hassle of ZipCash bills and, even better, pay the lowest toll rates, by getting TollTags for your entire fleet through NTTA’s corporate TollTag account program. Getting a corporate TollTag account is simple. NTTA’s Mobile TollTag team is ready to visit your dealership for corporate TollTag account signups for your fleet and personal TollTag account signups for your employees. The corporate account works similarly to a traditional TollTag account, but it is tailored just for businesses. Advantages included with the corporate account: Add an unlimited number of vehicles on a corporate account. Save money —registered owners without a TollTag pay 50 percent more during test drive.
The corporate [TollTag] account works similarly to a traditional TollTag account, but it is tailored just for businesses. anage your corporate TollTag account online or via M Tollmate, a free mobile app for Apple and Android devices. Adjust your prepaid balance based on the usage of your corporate account. Schedule the Mobile TollTag Team today and start saving money and time. Contact us at corporatedealership@ntta.org and a member from our dedicated Customer Service team will be glad to assist you. You can also visit www.NTTA.org to download your corporate account application.
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feature Taxability Issues on Service Contracts and Repairs Provided by the office of the Texas Comptroller
Extended Warranties, Service Contracts, Maintenance Contracts, Repair Parts and Accessories
In the normal course of business, a dealer may need to determine whether tax is due on the sale of an extended warranty, service contract or maintenance contract for the repair or maintenance of a motor vehicle. The sale of an extended warranty, service contract or maintenance contract covering the repair or maintenance of a motor vehicle after the manufacturer’s warranty expires, is not taxable. (This is in contrast to service contracts covering tangible personal property, such as refrigerators
Labor charges to repair or maintain a motor vehicle are not taxable, whether or not the labor is performed under an extended warranty, service contract or maintenance contract.
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and computers, which are subject to sales tax.) Labor charges to repair or maintain a motor vehicle are not taxable, whether or not the labor is performed under an extended warranty, service contract or maintenance contract. However, all parts, supplies and materials used or consumed in the repair or maintenance are taxable. The type of contract used by the repairperson determines who pays the tax.
Motor Vehicle Sold With an Extended Warranty, Service Contract or Maintenance Contract
Extended Warranty, Service Contract or Maintenance Contract Included in the Purchase Price
When a dealer sells a motor vehicle with an extended warranty, service contract, or maintenance contract without separately stating the cost on the invoice, motor vehicle sales tax is computed on the total sales price of the vehicle, which may include the amount the dealer paid for the extended warranty, service contract or maintenance contract. For example, if a dealer sells a motor vehicle with an extended warranty for $22,000 but the cost of the warranty is not separately stated on the invoice, motor vehicle sales tax is calculated on $22,000.
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Extended Warranty, Service Contract or Maintenance Contract Separately Stated from the Purchase Price
When a dealer sells a motor vehicle and the invoice separately states the charge for an extended warranty, service contract or maintenance contract, motor vehicle tax is due only on the sales price of the motor vehicle. Motor vehicle sales tax is not imposed on the separately stated price of the extended warranty, service contract or maintenance contract. For example, if a dealer sells a motor vehicle for $20,000 and itemizes a $2,000 charge for a service contract, motor vehicle sales tax is calculated only on the $20,000 charged for the motor vehicle. The purchaser of the vehicle does not owe motor vehicle sales tax on the $2,000 charge for the service contract.
Repairs
Labor to repair or maintain a motor vehicle is not taxable, but the parts,
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supplies and materials used in its repair are taxable. The party responsible for paying the tax depends on whether the repairs are performed under a lumpsum contract or under a separated contract. A separated contract separately states the sales price of parts and materials from the charge for labor; a lump-sum contract states a single price for both.
Labor to repair or maintain a motor vehicle is not taxable, but the parts, supplies and materials used in its repair are taxable.
Repairs Performed under a Lump-Sum Contract
When the repairman states a single charge for parts, materials and labor, the repairman is considered the consumer or end user of the parts and materials and must pay sales tax to his supplier on his purchase price of the parts and materials. The repairman does not collect tax from his customer. (The repairman’s customer for repairs under
an extended warranty, service contract or maintenance contract is usually not the vehicle owner, but the company providing the extended warranty, service contract or maintenance contract.)
Repairs Performed under a Separated Contract When the repairman separates the charges for parts and materials from the labor charge, the repairman is selling the parts and materials. The repairman must collect
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tax on the charge for parts and materials from the customer. (Again, the customer in these instances is usually the company providing the extended warranty, service contract or maintenance contract.)
the dealer sold, and the repair is not covered by any written warranty, the repair is deemed to be a repair under an implied warranty and no tax is due on the parts used in the repair.
Goodwill Repairs and Repairs under an Implied Warranty
Repairs to Vehicles Held for Resale
Repairs that are not covered by any warranty, either written or implied, are “goodwill repairs” and the parts used to make such repairs are taxable to the dealer. For example, if a dealer sells a vehicle “as is”, “with all faults” or using other language that alerts the buyer that there is no warranty of any kind, but makes free repairs, the dealer is responsible for paying sales tax on the parts used to make the “goodwill repair.” However, if within seven calendar days of the sale, a dealer makes free repairs to a motor vehicle that
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A dealer can purchase parts used to repair motor vehicles held for resale tax free. This also applies to accessories purchased to be installed on motor vehicles held for resale. Again, repair labor is not taxable. The dealer must hold a sales tax permit with the Comptroller and provide the seller of the parts or accessories with a Texas Sales and Use Tax Resale Certificate, Form 01-339 (front) at the time of purchase.
Promised Items
Occasionally, a component or accessory, such as specialty wheels
or a missing handle, may not be available for installation when the dealer delivers a motor vehicle to the buyer. The dealer can purchase the component or accessory tax free for resale as long as the item is described in the original sales contract or as an addendum to the sales contract. Motor vehicle sales tax is calculated on the total sales price including any charge for the item to be installed. For more information, see Sales Tax Rule 3.290, Motor Vehicle Repair and Maintenance; Accessories and Equipment Added to Motor Vehicles; Moveable Specialized Equipment and Sales Tax Rule 3.285, Resale Certificates; Sales for Resale, which are available on the Comptroller’s website at www.window.state.tx.us. If you have questions, email us using the form found at www.cpa.state.tx.us/taxhelp or call a tax specialist at 1-800-252-5555.
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2 014 tiada a u t o a u c t i o n
Local Chapters Victoria Dennis Schroller Victoria Autos Direct 361.578.0530 Dennis@victoriaautosdirect.com Meeting – 1st Monday (Monthly) Fort Worth Jerry Smith HJ Smith Automobiles 817.282.0102 hjsmithauto@yahoo.com Meeting – 4th Thursday (Monthly) Dallas County Kevin Mims VP Auto Sales 972.864.1300 kevinm@vpautosales.com Meetings as needed/TBD Houston Michael Zak Dixon Motors 281.931.1300 houstoniada@gmail.com Meeting – 2nd Monday (Monthly) Waco-Heart of Texas Bill Miller Bill Miller Used Cars Meeting – 2nd Monday (Monthly) For more information contact Eddie Massey, Massey Motors 254.753.6661 San Antonio Robert Beck Stop N’ Drive Motors 210.432.1101 stopdrive@texas.net Meetings quarterly (dates announced at www.txiada.com) El Paso Ricardo Gardea Cars Plus 915.778.8285 cars_plus@att.net Meeting – 3rd Friday (Monthly) 22
ABILENE * Alliance Auto Auction of Abilene 6657 US Hwy 80 West / 79605 325.698.4391 / 866.310.3555 www.allianceautoauction.com Ben Stock, Auction Manager Danielle Staples, Office Manager Friday: 10 AM * CM Company Auctions 2258 S. Treadaway / 79602 325.677.3555 / 866.310.3555 www.cmauctions.com Gregory Chittum, Owner Thursday: 10 AM
AUSTIN * America’s Auto Auction Austin / San Antonio 16611 S. IH-35 / Buda / 78610 512.268.6600 www.americasautoauction.com John Swofford, General Manager Tuesday: 1:30 PM
BEAUMONT Gulf Coast Auto Auction 4450 South 11th Street / 77701 409.840.6000 www.gulfcoastautoauction.com Roger Rashall, General Manager Rocky Rashall Blake Rashall Thursday: 7 PM
CARROLLTON * Texas Lone Star Auto Auction 2205 Country Club Drive / 75006 214.483.3597 www.TLSAA.com Jeff Dunning, Jr., General Manager Tim Clement, Assistant GM Michelle Elrod, Office Manager Tuesday: 1 PM / Thursday: 2 PM
DALLAS / FT. WORTH METROPLEX * ADESA Dallas 3501 N. Lancaster-Hutchins Rd / Hutchins / 75141 972.225.6000 Ken Osborn, GM Wednesday: 3 PM – New Car Trade Thursday: 9:30 AM – Consignment/ Fleet/Lease * Use your TIADA VIP Auction card at these participating auctions and get a FREE buy/sell fee (up to $200).
* Alliance Auto Auction of Dallas 9426 Lakefield Blvd. / Dallas / 75220 www.allianceautoauction.com Christopher Dean, General Manager Wednesday: 1 PM * America’s Auto Auction – Dallas 219 N. Loop 12 / Irving / 75061 / 972.445.1044 www.americasautoauction.com Robert Hammonds, GM Ruben Figueroa, Assistant GM. Tuesday: 2 PM / Thursday: 2 PM
EL PASO * El Paso Independent Auto Auction 7930 Artcraft Road / 79932 / 915.587.6700 www.epiaa.com Lori Pidgeon, GM Luke Pidgeon, AGM Wednesday: 10 AM – Fleet/Lease & Dealer Consignment Wednesday: 1 PM as scheduled – GSA Public Auction
HARLINGEN / McALLEN * Big Valley Auto Auction 4315 N. Hutto Rd. / Donna / 78537 956.461.9000 www.bigvalleyaa.com Bernard Watson, GM Lisa Harms, alternate contact Thursdays: 10 AM
HOUSTON * America’s Auto Auction – N. Houston 1440 FM 3083 / Conroe / 77301 / 936.441.2882 www.americasautoauction.com Buddy Cheney, GM Ben Nash, Sales Manager Mondays: 6:30 pm
longview * Alliance Auto Auction, LLC 6000 SE Loop 281 / 75602 903.212.2955 www.allianceautoauction.com Jeff Loftin, Auction Manager Brenda Hunt, Office Manager Friday: 10 AM
LUBBOCK Lone Star Auto Auction 2706 Slaton Hwy / 79404 806.745.6606 (local) / 888.299.6606 (toll-free) www.lsaalubbock.com Jim McNulty, Owner Dale Martin, General Manager Wednesday: 10 AM T e x a s
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d i r e c t o r y & r e s o u r c e g u i d e LUFKIN * Lufkin Dealers Auto Auction 2109 N. John Redditt Drive / 75904 936.632.4299 Wayne Cook Thursday: 6 PM
ROCKWALL Lakeside Auto Auction 1810 East I-30 / 75087 972.771.9919 www.lakesideaa.com Pete Conley, Owner Tuesday: 7 PM
TYLER * Greater Tyler Auto Auction 11654 State Highway 64 W / 75704 903.597.2800 Tuesday: 5 PM – Repo Lane Tuesday: 6 PM – Consignment
WACO * Heart of Texas Auto Auction (Waco’s oldest auto auction- Proudly serving dealers for 20 years!) 2508 HWY 6 / 76705 254.755.7713 www.heartoftexasautoauction.com Allan Wichkoski, Owner Kenny Reigert, General Manager Shirley McMillan, Office Manager Thursday: 7 PM * Alliance Auto Auction 15735 N. Interstate Hwy 35 / Elm Mott, TX / 76640 254.829.0123 / 254.829.1298 (fax) www.allianceautoauction.com Darren Darnell, GM darren.darnell@allianceautoauction.com Carmen Klaus, Office Manager Every Friday: 10 AM
oKLAHOMA CITY, OK * Dealers Auto Auction of OKC 1028 S. Portland / Oklahoma City, OK / 73108 405.947.2886 /405.943.8370 (fax) www.daaokc.com Gary Smith, Owner/President/GM John Reininger, Asst. GM Mike Egdahl, F/L Manager Thursdays: 8:30 AM – Consignment Sale INOP Sale held weekly GSA sale held monthly (open to public) Call for info on sale dates and times Every other Tuesday: 10 AM – GM Sponsored Factory Sale September 2014
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The TIADA Website:
www.txiada.com Members can log in with their username/password and access our Dealer Member Directory, Legislative Action Center, Legal Consultation Service and much more. Register for all upcoming TIADA events online at the Calendar of Events; access our online membership application; find contact information for all our Local Chapters, and find many additional resources at our Links page. Texas Department of Motor Vehicles 888.368.4689 www.txdmv.gov Office of Consumer Credit Commissioner 800.538.1579 www.occc.state.tx.us Texas Comptroller 800.252.1382 www.window.state.tx.us NIADA 800.682.3837 www.niada.com
Repossessions
American Recovery Association 972.755.4755 www.repo.org or contact TIADA state office
Forms
Burrell Printing 800.252.9154 www.burrellprinting.com
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Austin Music Austin Food Austin Flavor with 24
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The
2014
Annual Confwrap-up erence Kroening by Jenny TIADA Special Projects Director
D
ealers traveled with their families from all corners of Texas to gather in Lost Pines the last Sunday in July for three days of education and fellowship at the TIADA Annual Conference and Expo. The event was made possible by the support of 73 sponsoring companies, who helped bring the total number of registrants up to nearly 325. The host hotel, Hyatt Lost Pines Resort and Spa, sits at the end of a 3-mile stretch of winding, curving road off Highway 71 west of Bastrop. “I think it was the best location I have been yet for our conference,” shared Eddie Hale of Neighborhood Autos in Decatur. “The lack of external distractions seemed to allow more time after meetings to network and share ideas. I personally loved it!” The networking and sharing of ideas began at the welcome reception Sunday evening, which allowed attendees to float between the cool
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of the indoors and the “cool” offered by the classic cars situated just outside. Not a group to neglect an opportunity to mug for the camera, TIADA members took turns getting in front of a green screen to make photo flipbooks before resting up for the big day of education that lie ahead. Keynote speaker Jonathan Sprinkles kicked off the opening general session Monday morning with a highenergy talk that focused attendees on achieving results with diligence and powerful leadership. The rest of the day was largely occupied by the 4 one-hour education break-out sessions, which offered as many as seven concurrent sessions for attendees to choose from. Among the education presenters was Chuck Bonanno, who is ending his career as a Twenty Group facilitator to head back into the field to work at a dealership. Attendees of his session pulled out their phones to snap pictures of his PowerPoint slides. “I’ll give you a link to this PowerPoint, guys. You don’t have to take pictures!” 25
assured Bonanno, but dealers opted to keep those valuable statistics at the ready on their cell phones. President and founder of NABD, Ken Shilson shared insights gained from his 20 years in the auto industry in one of the morning break-outs. “Ken is a master of information. It will take a few more days to digest it all, and then we’ll make adjustments to our business plan,” said Nelsen Simonsen of Stop N’ Drive Motors in San Antonio. The grand opening of the exhibit hall included lunch and time for sponsors and dealers to meet and discuss partnership opportunities. Although education was the focus of the event, everyone in attendance took advantage of the time offered to get some business done. Greg Gifford of AutoRevo said, “The conference was amazing. The laid-back atmosphere seemed to encourage dealers to stop by the booths and visit, so we got a ton of interested leads.” The Monday afternoon education sessions included a hands-on workshop that
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got dealers out of their seats to gather outside around vehicles that had different frame types. From there, dealers learned how to detect commonly overlooked damage that can occur on each type of frame. Monday concluded with the drawing of six special membership prizes of $500 each. TIADA’s special membership is the association’s only annual fundraiser. Individuals purchased a “special membership” to the association for $100, making them eligible to win cash prizes. (This explains the pictures you’ll see in the surrounding pages of people holding cash.) Tuesday began with David Walsh’s keynote presentation, 30 Years in 60 Minutes. Miguel Gutierrez of Peek Motor Co. in Houston said of David, “He was amazing and his quotes, ‘Don’t let the salespeople puke on your costumers,’ and ‘Never tell a dealer Nothing’ is causing us to change our way of doing business.” The highlight of the conference for many dealers was Tuesday morning’s
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roundtable discussions with topics ranging from “Best Twenty Group Ideas EVER” to “Handling Customer Complaints.” Vicki Smith of A OK Auto Sales in Porter said, “I got an idea from Tommy Gregory that will save me thousands!” Tuesday afternoon was focused on advocacy with the association providing a legislative summary with guest speaker J.J. Garza, the Chief of Staff for Representative Rene Oliveira, discussing the topic of lien issues, and Jeremiah Kuntz from TxDMV sharing details of the single sticker initiative. Following the summary, attendees met for the region caucuses, where they discussed the issues they would like the association to focus on during the next legislative session. HL Hensley of Automax of Lubbock stated, “The legislative caucus allows me to really understand what is happening to our industry on a state level.” The caucuses were followed by the House of Delegates meeting, where the 2015 TIADA state officers were elected. As has been the tradition, the conference culminated in the presidential awards banquet and dinner, which included the introduction of the 2015 TIADA President, Brent Rhodes of Fiesta Motors in Buda. Awards were given to Brandi Brown, winner
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of the TIADA Scholarship; Texas State Representative Rene Oliveira, winner of the Independent Award; and Wayne Meagher, Top Recruiter and NIADA Crystal Award winner. The final award of the night, the prestigious Texas Quality Dealer of the Year, was presented to Blake Ingram of Auto City in Dallas. Blake is a past president of TIADA and currently serves on the TxDMV Board of Directors (see pg. 30). Before calling it a night, a ticket had to be drawn for the $10,000 special membership grand prize. Trey Crouch of Trey Crouch’s Wheels On Credit in McAllen was the lucky winner. In response to his ticket being picked, Trey said,” It is an honor to be a Texas independent automobile dealer. I was speechless when my name was called out. It was a great experience for my family and friends at the table. They will all be buying tickets next year!” Miguel Gutierrez summarized his conference experience by saying, “I feel like this year’s conference was one of TIADA’s best, if not THE best, and hope that next year’s is even better!” Plans are already underway for the 2015 TIADA Annual Conference and Expo to be held August 9–12, 2015 at the JW Marriot San Antonio Hill Country Resort & Spa.
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feature Blake Ingram Named 2014 Texas Quality Dealer of the Year
B
lake Ingram of Auto City in Dallas has been a part of the auto industry for as long as he can remember. He is well-respected and admired by his peers for his keen business sense, affable demeanor and prudent decision-making, all of which contributed to his appointment to the Texas Department of Motor Vehicles Board of Directors in 2011, where he continues to serve today.
Texas Dealer: What does being named “Texas Quality Dealer of the Year” mean to you? I can’t adequately express how
honored I am to be chosen as this year’s Quality Dealer. I have a picture from a Dallas chapter meeting back in 1993, when my family (including my one-year-old son Blake Jr.) came to watch my father, Martin Ingram, get inducted into the Dallas Chapter Hall of Fame. So many people liked and respected my father as a businessman and a friend, and it was always a goal to follow in his path and grow a business that not only was successful, but also truly helped people – employees, customers, the community, and other dealers. That’s what being a “Quality Dealer” means to me. Some of the people I most respect in this industry, and some of my closest friends, are past Quality Dealer inductees. Being included on a list with them is very humbling, and one of the biggest honors I’ve ever received.
Texas Dealer: When did you decide to get involved in TIADA and why? I have
been involved in TIADA since the early ‘90s. Early in my career, my attorney, Mike Dunagan, told me it was very important for me to be involved in TIADA, and I always try to follow the advice of my attorney. I quickly realized how right he was. I made so many important connections with people who helped me grow in my knowledge of this business.
Texas Dealer: What dealer(s) or individuals have been most influential to you in your career? My father, Martin
Ingram, is certainly the most influential. He got his start in the industry back in the ‘50s, and I grew up around the business. My first job at the dealerships was in elementary school, when I was in charge of stocking the
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Blake Ingram (left) holding the Quality Dealer of the Year medal presented to him by Gary Sayre of Gary’s Used Cars in Dallas at the 2014 TIADA Annual Conference and Expo.
coke machine. Growing up, I ended up experiencing pretty much every job at the car lots—from detailing cars, to sales, to driving a wrecker. What a valuable education all of those jobs proved to be! Through TIADA, the Texas DMV, and various Twenty Groups, I have a large list of dealers I respect, and who influence me both as a businessman and as a person. I am enormously grateful for the friendships and connections I’ve made through TIADA and NIADA.
Texas Dealer: In what ways has TIADA impacted you and/or your business?
TIADA has always been a great source of education, but what I really appreciate is their ability to be our advocate in Austin. Many dealers don’t realize what a vital role TIADA serves in the legislative process. If you think we have too many regulations now, you would be shocked by what could have been had it not been for TIADA. Our elected representatives in Austin have a need and a desire for knowledge. If they don’t get it from TIADA, are you, (cont’d on pg. 32] T e x a s
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Blake Ingram named 2014 Texas Quality Dealer of the Year (cont’d from pg. 30)
as a dealer, comfortable with some other group being their provider? I’m not. I trust TIADA to communicate with our legislators, giving the accurate, clear, trustworthy information that enables dealers across the state to effectively partner with our elected representatives in Austin.
Texas Dealer: How has community involvement played a role in your success? I have been grateful for the many op-
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portunities I’ve had to serve the communities where I live and where I run my business. Among other things, I’ve been a town council representative, served on the Sunnyvale 4A board, served on the Southeast Dallas Chamber of Commerce board, been the title sponsor of Stand Up Pleasant Grove for the last 4 years, and helped found the Pleasant Grove Food Pantry. I’ve also tried to give my customers ways to help community organizations. For instance, at our large annual Christmas customer event, the ticket for entry is a jar of peanut butter to help stock the food pantry. Do these activities sell even one extra car? I have no idea, but it really doesn’t matter. When the community thrives, people and businesses succeed together. And all of us can play a small part in creating a strong, healthy, prosperous community.
THE
DATE
2015 TIADA Annual Conference and Expo
August 9–12, 2015 JW Marriott Hill Country Resort & Spa, San Antonio, TX
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e-Tag Supplies —
In Stock for Immediate Shipment!
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TIADA DeAler AcADemy 2014
Keeping Your Dealership Legal and Compliant a seminar with Michael W. Dunagan, TIADA General Counsel Author of the standard-setting books, “Dealer Financing of Used Car sales” and “Texas Automobile repossession: A Lien Holder’s Legal Guide.” This class is the 2014 version of attorney Michael W. Dunagan’s ongoing quarterly compliance seminar. Featuring updates on both federal and state compliance issues, this session focuses on advanced dealership financing issues. This is the practical side of compliance from the association that understands you have a business to run — and you want to run it right. The seminar will focus on advanced financing concepts, with special emphasis on in-house financing, repossession & bankruptcy issues, OCCC compliance and federal regulations. u u u u u u u u u u
u u
Customer ID requirements – what is acceptable? Privacy Notice requirements – do we need a new, custom form? risk-based Pricing – what does the rule require? Credit Card Convenience Fees – what is allowable? Adverse Action rule – who is affected? Consumer Financial Protection bureau (CFPb) – what can dealers expect? bankruptcy – when do we have to give the vehicle back? repossessions – When does the 60% rule apply? Is repo notice required? Do we have to return custom wheels? Do we have to disclose a GPs unit? OCCC Audits – what are the most common mistakes dealers make? TxDMV enforcement – advertising violations, title management issues & more
PLUS: Texas Legislative session – an update on bills that will affect the industry Q & A – don’t leave until you get all your questions answered by the top industry expert in Texas, Michael W. Dunagan
Monday, October 27, 2014 Houston, Texas
seminar will be held from 9:00am - 3:30pm DoubleTree by Hilton Houston Hobby Airport 8181 Airport blvd. | Houston, TX 77061 713.645.3000
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Discount Pricing for Multiple Attendees! MeMbers – First registrant $149, each additional $99 (Must be from same dealership)
NON-MeMbers – $299
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register online at w w w . t x i a d a . c o m or by phone at 800.442.5944. Texas Independent Automobile Dealers Association
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feature Gamification is on the Rise — Why
Your Dealership Should Think Twice
G
by Adam Hollander, founder of Fantasy Sales Team
amification has become a real buzzword over the last few years. The idea of applying game mechanics to incent behavior has really taken hold; new articles and statistics are published almost every day and we’re seeing huge numbers of companies, dealers and manufacturers integrate gamification into their processes. Information technology researcher, Gartner, has even predicted that by the end of 2014 over 70% of the Global 2000 will have at least one ‘gamified’ application in place. However, the more well-known stat from Gartner is that 80% of those same gamification implementations will fail to meet their business objectives. I’ve heard many dealers and companies talk about using gamification solutions because they look fun. This is the wrong reason to use gamification. Gamification in the dealer environment is not about fun or even engagement — it’s about driving business results through changes in employee behavior. Gartner says that the reason most gamification implementations will fail is because of poor design. In my experience, poor gamification design is a direct result of not identifying (and being able to measure against) key business problems a company is looking
36
to solve. Let me share an example using something every company cares about: sales. A few years ago I was managing a team of sales people. Like most sales managers, I was always looking for ways to motivate my reps to close more business. So, again, like most sales managers, I would constantly run sales contests and offer SPIFFs to my reps. However, I started to notice a few problems: 1) The same reps won every time. I had a few top performers that would always take home the prizes. More importantly, these were not the reps I wanted to motivate. Ideally I wanted to incentivize everyone else; not the reps that would perform anyway. 2) R eps stopped caring once they fell behind. The day I would roll out a new contest, everyone would get excited about it. But inevitably, reps would fall out of contention, at which point they would disengage and stop caring about the contest. One could argue that if you were going to implement gamification for a sales team, you should address these problems. How do you find a way to motivate everyone, not just your traditional top performers? How do you keep reps engaged even if they’ve fallen behind? There are a number of sales gamification solutions on the market today. Many are essentially leaderboards which allow reps to earn points and individually compete against each other. But what most of them have done is simply created a more fun and dynamic way to showcase the same results that sales managers have put into reports and spreadsheets for a decade. If you post an online leaderboard of sales results, won’t the same top performers keep winning? Won’t the other reps become disengaged (and demotivated) if they fall too far behind? This is an example of implementing poorly designed gamification for the wrong reasons. Let me be clear: Gamification can have tremendous impact in an enterprise environment. I’ve seen that first hand on dozens of occasions. But you shouldn’t implement gamification for gamification’s sake. First, you should identify exactly what business problem you’re looking to solve. Then you need to ensure whatever gamification solution you’re evaluating will have a direct and measurable impact against that problem. Don’t fall into the trap of implementing solutions simply because they look fun or engaging. Remember that you’re making an investment of time, employee attention and budget. For all of those items there’s an opportunity cost. You need to be able to measure a return on a gamification investment just like any other. So think twice and make sure you’re doing it for the right reasons. T e x a s
D e a l e r
September 2014
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September 2014
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regulation matters Looking Ahead to a “Single Sticker” World
by Danny
A
s reported in the September 2013 issue of this magazine, a bill was passed in the last legislative session that required the registration and inspection stickers to be combined into one “single sticker.” Several major media outlets recently featured stories on this initiative, which is scheduled to go into effect in March of 2015. I had a chance to provide an update on this issue along with Jeremiah Kuntz, Director of Government & Strategic Communications for TxDMV (now Director of VTR, see page 16), at the TIADA Annual Conference & Expo in July during our Legislative Summary. In general, once the legislation goes into effect, a vehicle will be required to have current inspection in order to be registered. This will be the case for one year as the agency aligns all inspections and registrations to expire at the same time. Inspections will continue to be done at inspection stations, but no inspection sticker will be issued at that time. The inspection station’s portion of the fee will be paid at the time of inspection, and the state’s portion of the fee will be paid at registration. It is our understanding that the cost of neither inspection nor registration will increase, and that inspection fees will continue to be allowable as a pass-through to the customer. Once “single sticker” has been fully implemented (expected to be March 2016), a used vehicle sold by a dealer will be required to have been inspected in the 180 days preceding the sale date in order to be registered. (In a private sale, or registration renewal, the time period will be 90 days.)
What about vehicles riding on a buyer’s temp tag?
Vehicles being operated on a buyer’s temp tag will still be required to have current inspection. However, law enforcement will be made aware that such a vehicle is NOT required to have a windshield sticker. TxDMV strongly recommends that the printed vehicle inspection report be kept in the glove box until the plates and sticker are mounted.
How will the county / a dealer / a citizen know when the vehicle was last inspected?
TxDMV tells us that inspection report data from the inspection stations will be centralized in a database that
42
Langfield
TIADA deputy director
will be accessible to dealers and the general public, and searchable by VIN and/or license number. It is our understanding that the tax office will be accessing the same database to determine a vehicle’s inspection status.
What about vehicles riding on a metal dealer’s plate?
Similar to a buyer’s temp tag, vehicles being operated on a metal dealer’s plate will still be required to have current inspection. Again, law enforcement will be made aware that such a vehicle is NOT required to have a windshield sticker. As with a buyer’s tag, although it is not required, TxDMV strongly recommends that the printed vehicle inspection report be kept in the glove box of each vehicle riding on metal dealer plates.
How will this be handled once webDEALER has been implemented for used vehicles?
As many of you know, webDEALER is an online system that will allow dealers to transfer titles from any internet-connected computer (see the article, “TxDMV’s webDEALER: What’s in it for You?” from the July 2014 issue of this magazine). It is our understanding that webDEALER will calculate all fees due at the time of title and registration, including the state’s portion of the inspection fee, as well as allow for a manual verification of inspection.
Bottom line for Texas independent dealers: Starting on March 1, 2015, a vehicle may be registered as long as it has current inspection as of the sale date. Starting on March 1, 2016, a vehicle may be registered as long as it has received a passing inspection in the 180 days preceding the sale date. If the inspection is more than 180 days old on the sale date, then a new inspection will be required before the vehicle can be registered. T e x a s
D e a l e r
September 2014
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TIADA DeAler AcADemy 2014 Education Offerings for the Fall Seminar Schedule Dealer 101: Nobody Told Me That!
Keeping Your Dealership Legal & Compliant
Monday, September 8, 2014 – Dallas
Monday, October 27, 2014 – Houston
Wednesday, November 19, 2014 – Dallas
Monday, November 10, 2014 – Austin
Monday, December 8, 2014 – Dallas
Thursday, November 20, 2014 – San Antonio
8:30 a.m. - 5:30 p.m.
9:00 a.m. - 3:30 p.m.
This class is designed for those dealers new to the business, those considering opening their own dealership, new employees, family members or anyone else needing a refresher on the basics, including: • Transferring Titles • Odometers • Title & Registration Fees • Temp Tags & Metal Dealer Plates • Requirements for Maintaining Dealer License • The Buyer’s Guide - As Is • SOLD! The Deal Jacket
Better BHPH Financials: How to Get Organized for Growth
The seminar will focus on advanced financing concepts, with special emphasis on in-house financing, repossession & bankruptcy issues, OCCC compliance and federal regulations. • Record Keeping • Motor Vehicle Sales Tax • Vehicle Inventory Tax • Consignment • Online Sales • Out of State / Out of Country • OCCC: the MVSF License • Federal Requirements
• OCCC Audits – what are the most common mistakes dealers make? • What is the Comptrollers position on GPS units? • Credit Card Convenience Fees – what is allowable? • Consumer Financial Protection Bureau (CFPB) – how might it affect dealers? • Bankruptcy – when do we have to give the vehicle back? MEMBERS - 1st Registrant $149, each additional $99 NON-MEMBERS $299
$149 per registrant
8:30 a.m. - 12:00 p.m. The craziness of a busy BHPH operation can make it tough to plan for future growth. But sometimes you need to take a few hours off from working IN your business so you can work ON your business. Participants will learn: • How to increase their credit line, and/or establish a new line • Cash flow management (the key to future planning) • Static pool analysis—what it is and how it works
• How to determine how many units and dollars you need on hand • How to properly value inventory, including turn time • Proper expense allocation and costing
MEMBERS - $99, includes up to 3 attendees per dealership • NON-MEMBERS $199
Texas I n d epen d ent A utomob i l e D ea l ers A ssociation
Register online at w w w . t x i a d a . c o m or by phone at 800.442.5944. Texas Independent Automobile Dealers Association
behind the wheel
Martin
Your Day at the Capitol is Set
F
or some time now, my parents have been making the six-hour drive to Pecos, Texas once and sometimes twice a year to buy cantaloupe. If you’ve ever had Pecos cantaloupe you might understand. If you haven’t, you will probably join the majority who think they are crazy because no fruit can be that good. I fall somewhere in the middle. Every year they ask if I want to make the trek to Pecos and I think it’s the craziest idea ever. But if I am lucky enough to get some of that sweet cantaloupe when they return, I understand why so many people journey to west Texas. I always think of farming and gardening when it comes to the political process. To benefit, you have to plant seeds and ideas at the right time, cultivate relationships and everyone must be working in the same direction. There is no doubt that a little luck along the way never hurts. This begs the question: What have we done or what can we do to make sure we have the best opportunity for political success come January? TIADA leaders, including state officers, local chapter presidents and active members know you can’t plant seeds one day and pick fruit the next. They have worked hard over the past year to get to know many legislators in their respective areas. TIADA sat down with numerous potential policy makers across the state and discussed the association’s legislative priorities and interests. Our local chapters did their part as well, inviting local candidates to their monthly meetings in an effort to help them get to know our business a little better. Our political action
by Jeff
tiada executive director
committee, INDEPAC, has also been very active. Thanks to you, INDEPAC has continued to grow and we have been able to contribute more dollars to candidates who support the independent automobile dealers of Texas. While the governor and lieutenant governor races will take center stage with the pundits and poll-readers, the elections that will have the greatest impact on our industry will take place a little further down on the ballot. The results of the state Senate and the Texas House of Representatives races will become our main focus. The winners from around the state will soon make their way to Austin and bring with them their ideas and ideology. When you’re growing a garden, planting the seeds, watering, weeding, and fertilizing are all part of the work required to get the desired yield. (I know there are plenty of fertilizer jokes available here, but I am going to let you insert your own.) The point is that we need to take advantage of all of our hard work and continue doing the things that will make this association effective and help improve our industry. TIADA will host Lobby Day on January 27, 2015. Mark it on your calendar now. This is a great opportunity to come visit your legislator and help TIADA advocate for and protect your professional interest. I understand it’s a commitment to be away from your dealership during tax season but the time will be right to enjoy the fruits of our labor. Good news is, you don’t have to drive to Pecos, Texas and the reward will be sweeter than any cantaloupe you’ve ever eaten.
TIADA will host Lobby Day on January 27, 2015. Mark it on your calendar now. 46
T e x a s
D e a l e r
September 2014
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