Legislature(2003 - 2004)

05/16/2003 08:00 AM STA

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
HB 272-MOTOR VEHICLE DEALERS                                                                                                  
                                                                                                                                
Number 0010                                                                                                                     
                                                                                                                                
CHAIR  WEYHRAUCH  announced  that   the  committee  would  return                                                               
attention  to HOUSE  BILL  NO.  272, "An  Act  relating to  motor                                                               
vehicle dealers."                                                                                                               
                                                                                                                                
[Although an  objection to  moving proposed  committee substitute                                                               
(CS),  Version   23-LS0975\H,  Bannister,  5/14/03,   before  the                                                               
committee  was still  pending  from the  Thursday,  May 15,  2003                                                               
House  State Affairs  Standing Committee  meeting, Version  H was                                                               
treated as before the committee.]                                                                                               
                                                                                                                                
CHAIR WEYHRAUCH announced that public testimony was closed.                                                                     
                                                                                                                                
Number 0220                                                                                                                     
                                                                                                                                
LINDA SYLVESTER, Staff to  Representative Bruce Weyhrauch, Alaska                                                               
State Legislature,  noted that every  state in the  country takes                                                               
special care  to articulate in statute  the relationships between                                                               
[car] manufacturers,  [car] dealers,  and consumers.   Last year,                                                               
she said,  Alaska, after  four years  of consideration,  passed a                                                               
25-page  omnibus motor  vehicle dealer  bill.   She reminded  the                                                               
committee  that  [in  previous   days'  hearings]  it  had  heard                                                               
testimony on  the consumer protection statutes  regarding brokers                                                               
of motor vehicles from 1993.                                                                                                    
                                                                                                                                
Number 0333                                                                                                                     
                                                                                                                                
MS. SYLVESTER  said that the  government is concerned,  because a                                                               
vehicle is  the second-most  expensive purchase  a person  in the                                                               
U.S.  will make.   Another  reason that  the government  is "very                                                               
interested," she  indicated, is:  "The  franchise agreements that                                                               
a manufacturer has with their  chosen agents of their product are                                                               
unilateral agreements and, as such,  the franchises are in a very                                                               
precarious situation, dealing with the manufacturers."                                                                          
                                                                                                                                
MS. SYLVESTER  said that HB  182, which  passed out of  the House                                                               
Labor and  Commerce Standing Committee [during  the Twenty-Second                                                               
Alaska State Legislature],  has "oddball things" such  as where a                                                               
manufacturer can establish  "a new dealership -  a new franchised                                                               
dealer."    She  explained  that  that's  a  protection  for  the                                                               
franchised dealer.   She said, "This legislature has  taken a lot                                                               
of  interest in  establishing  whether that  range  should be  14                                                               
miles, 20  miles, 30 miles,  a city,  or what."   The legislature                                                               
finally decided  on a  14-mile range,  which she  explained means                                                               
that,  by  statute  -  not  through  a  manufacturer's  franchise                                                               
agreement  - manufacturers  may  not establish  a new  dealership                                                               
[within 14 miles of] an existing franchise.                                                                                     
                                                                                                                                
MS.  SYLVESTER clarified  that  what is  being  discussed is  new                                                               
vehicles, not used.   She said that HB 272 defines  what is a new                                                               
versus a  used vehicle.   She noted that some  previous testimony                                                               
stated that what makes a  used vehicle is when the manufacturer's                                                               
certificate  of origin  is  converted into  a  title.   Different                                                               
states  consider   that,  she  said;  however,   Alaska  doesn't.                                                               
Alaska, she said, "talks about a  current model year."  A current                                                               
model  year is  "kind of  a  squishy term,"  Ms. Sylvester  said,                                                               
because "that could  be 14 or 15 months, depending."   She added,                                                               
"So we've taken care to establish what a used vehicle is."                                                                      
                                                                                                                                
MS.  SYLVESTER said  that a  consumer doesn't  expect all  of the                                                               
perks and  "neat treats"  that come  with a  new vehicle  to come                                                               
with a  used vehicle.   She said that  everyone has heard  of the                                                               
problems  that used  vehicles  have, and  she  said, "And  that's                                                               
where the consumer protection angle  comes in."  She continued as                                                               
follows:                                                                                                                        
                                                                                                                                
     So what  we're talking about  here is whether or  not a                                                                    
     broker  of  used vehicles  is  allowed  to sell  a  new                                                                    
     vehicle.   It's not  [that] we  contest a  vehicle that                                                                    
     has just simply  had a title conversion  with 20 miles.                                                                    
     What we're saying is that  it's the current model year,                                                                    
     with some caveats.  ...  AS 45.25.180 establishes these                                                                    
     guidelines  for  relevant  market  areas  for  the  new                                                                    
     vehicles and used vehicles.                                                                                                
                                                                                                                                
     ... The  manufacturer gives his  dealer a  ... relevant                                                                    
     market  range.     ...  Whether  we're   talking  about                                                                    
     Canadian  vehicles,   [or]  vehicles  that   are  being                                                                    
     illicitly  unloaded by  a dealer  in another  state and                                                                    
     given to  a broker in Alaska  at a reduced cost  - what                                                                    
     happens   is,   there's    a   loophole   that's   been                                                                    
     established,  where   the  ...   new  cars   have  been                                                                    
     converted, and they come in  under the wire that Alaska                                                                    
     statute   has  established   and   that  supports   the                                                                    
     manufacturers' ... agreement[s] with it's franchises.                                                                      
                                                                                                                                
     The issue is:  Currently,  the Canadian market vehicles                                                                    
     or  these  gray-market  vehicles are  what's  happening                                                                    
     now;  but  what  we're  talking  about  is  an  illicit                                                                    
     transaction.   And it violates  not only  the franchise                                                                    
     agreement,  it violates  the  spirit  of our  statutes.                                                                    
     And it's  a clarification  that we need  to make.   And                                                                    
     that  is the  issue.   It's  not  [North American  Free                                                                    
     Trade  Agreement]  (NAFTA)  -  it's  not  restraint  of                                                                    
     trade.   We're  expanding  the  trade potential  that's                                                                    
     available for used car dealers  and brokers.  But we're                                                                    
     also clarifying what a new vehicle is.                                                                                     
                                                                                                                                
     You've heard  testimony ...  that should  be compelling                                                                    
     and  convincing, that  a vehicle,  however  it gets  to                                                                    
     Alaska, if  it's got  20 miles  on it,  it's not  a ...                                                                    
     used vehicle,  it's a new  vehicle.  And it's  a slight                                                                    
     of hand.  And if it's  not illegal in Canada, then that                                                                    
     ... it  just simply doesn't  relate here.   The vehicle                                                                    
     was acquired  through some kind  of fraud.   Otherwise,                                                                    
     the  dealers would  turn these  vehicles right  over to                                                                    
     the  car   brokerage  or   the  auction   (indisc.)  in                                                                    
     Washington  State.    They  don't  do  that.    It  was                                                                    
     illicit,  it's unethical,  and  it  doesn't change  the                                                                    
     fact  that it's  unethical when  they're being  sold in                                                                    
     the states underneath the wire  and ... contrary to the                                                                    
     spirit of our statutes.                                                                                                    
                                                                                                                                
Number 0801                                                                                                                     
                                                                                                                                
REPRESENTATIVE GRUENBERG said he is looking at AS 45.25.180.  He                                                                
said that it seems to him that it involves new motor vehicle                                                                    
dealers alone.  He asked Ms. Sylvester if that is correct.                                                                      
                                                                                                                                
MS.  SYLVESTER  concurred.    She  confirmed  that  that  statute                                                               
addresses current-year  vehicles, not  used vehicles.   She said,                                                               
"These  are new  vehicles,  and these  are  the impediments  that                                                               
franchised dealers are required to  adhere to."  She continued as                                                               
follows:                                                                                                                        
                                                                                                                                
     This  is relevant,  because ...  in close  proximity to                                                                    
     the franchised  dealers, you have a  car brokerage that                                                                    
     ... is  selling new  vehicles acquired  through illicit                                                                    
     means.   So, ... if you,  Representative Gruenberg, ...                                                                    
     wanted to set  up a franchise - if you  wanted ... do a                                                                    
     Ford  dealership, you  would not  be able  to.   If you                                                                    
     wanted  to acquire  the  Ford  product through  illicit                                                                    
     means  through Canada,  you would  be able  to, because                                                                    
     our  statute  has  a loophole  that  we're  seeking  to                                                                    
     close.  And  again, it doesn't' matter  if the vehicles                                                                    
     come  from  Canada or  if  they  come from  some  other                                                                    
     illicit source, the  fact is, they don't  come from the                                                                    
     manufacturer  directly  to  the franchise  of  the  new                                                                    
     vehicles.                                                                                                                  
                                                                                                                                
Number 0930                                                                                                                     
                                                                                                                                
REPRESENTATIVE GRUENBERG noted that  AS 08.66.015 refers not only                                                               
to new vehicles, but also current  model motor vehicle.  He said,                                                               
"Had they intended  to include current model motor  vehicle in AS                                                               
45.25.180, they  would have clearly stated  that, wouldn't they?"                                                               
He  clarified that  he  was  suggesting that  it  was a  definite                                                               
legislative  determination not  to  include  current model  motor                                                               
vehicle in the new dealership statute.                                                                                          
                                                                                                                                
MS. SYLVESTER stated her belief  that Mr. Sniffen, who drafted HB                                                               
182, would be  the person to "answer that question."   She added,                                                               
"And I believe that both of these things stand on their own."                                                                   
                                                                                                                                
Number 1046                                                                                                                     
                                                                                                                                
REPRESENTATIVE LYNN  referred to an advertisement  [which is part                                                               
of a 5-page handout in  the committee packet, apparently provided                                                               
by  the  Mendenhall   Auto  Center  in  Juneau,   Alaska].    The                                                               
advertisement  was about  vehicles  priced to  save the  consumer                                                               
money and "all with warranties."   Representative Lynn stated his                                                               
understanding that a warranty comes  from the manufacturer and is                                                               
built into the  price of the [vehicle], while  a service contract                                                               
is something that  consumers purchase on their  own, sometimes to                                                               
extend beyond a warranty.  He  asked if the warranties offered in                                                               
the advertisement  are paid for in  addition to the price  of the                                                               
vehicles being  sold, or if they  are paid for by  the dealer who                                                               
advertised.                                                                                                                     
                                                                                                                                
Number 1135                                                                                                                     
                                                                                                                                
MS. SYLVESTER stated  her understanding that "those  are not paid                                                               
for   independently."       She   referred   to    the   Heritage                                                               
[Administration  Services, Inc.,  new  vehicle limited  warranty]                                                               
form [included  in the committee  packet, attached to  a six-page                                                               
handout, the  first page  of which  is from  the State  of Alaska                                                               
Department of Law].   On the form, she noted,  there is an option                                                               
for  deductibles.   She  said,  "So you  ...  can have  different                                                               
versions of  the deductibles."   She deferred further  comment to                                                               
Mr. Lyberger, Mr. Allwine, or Mr. Sniffen.                                                                                      
                                                                                                                                
REPRESENTATIVE  LYNN  asked,  if  he  were  to  buy  one  of  the                                                               
advertised  automobiles,  would   he  have  the  warranty/service                                                               
contract as part  of the deal, or  would he have to buy  it as an                                                               
additional fee.                                                                                                                 
                                                                                                                                
MS. SYLVESTER responded,  "These are things that  Mr. Lyberger is                                                               
providing."   She stated her understanding  that other brokerages                                                               
that  have the  Canadian market  vehicles where  the manufacturer                                                               
has not extended a warranty  are not required to have warranties.                                                               
Mr. Lyberger,  she said,  does [have  the warranties]  to compete                                                               
within  his market.    In  response to  a  follow-up question  by                                                               
Representative Lynn,  she concurred  that if he  were to  go down                                                               
the block  to buy  the vehicle,  it may  not have  that warranty.                                                               
She offered the following clarification:                                                                                        
                                                                                                                                
     When  a vehicle  comes  into the  country, is  imported                                                                    
     legally,   when  it's   acquired  illicitly   from  the                                                                    
     franchise,  turned   over  to  the  importer,   and  is                                                                    
     imported legally  into the United States,  the importer                                                                    
     must  ... -  and this  is a  federal requirement  - ...                                                                    
     place a bond  on the vehicle ... to  cover any recalls.                                                                    
     And the  registered importer  tracks the  vehicles that                                                                    
     way.                                                                                                                       
                                                                                                                                
MS SYLVESTER stated  that that's the only requirement.   She said                                                               
that  the  registered  importer retains  that  responsibility  of                                                               
keeping the bond for any safety recall.                                                                                         
                                                                                                                                
Number 1270                                                                                                                     
                                                                                                                                
REPRESENTATIVE LYNN  asked if he  could take the vehicle  back to                                                               
the new car  dealer to get a  [part on his] vehicle  fixed if the                                                               
manufacturer had a recall [on that part], for example.                                                                          
                                                                                                                                
MS.  SYLVESTER  answered  that the  responsibility  is  with  the                                                               
registered  importer,   and  she  stated  her   belief  that  the                                                               
Department of Transportation regulates  that very carefully.  The                                                               
importer  would contact  Representative  Lynn,  for example,  and                                                               
arrange for  the recall to  be satisfied,  she said.   She added,                                                               
"But ...  that's the only  requirement.  They're not  required to                                                               
...  substitute   service  contracts  in  place   of  warranties.                                                               
Warranties are something that the  manufacturers do, because they                                                               
believe in their vehicle."                                                                                                      
                                                                                                                                
Number 1365                                                                                                                     
                                                                                                                                
REPRESENTATIVE  GRUENBERG   referred  to  page  1,   line  9,  of                                                               
Version H.   He  asked what  the purpose  was of  eliminating the                                                               
words "new or".                                                                                                                 
                                                                                                                                
Number 1430                                                                                                                     
                                                                                                                                
CLYDE  (ED)  SNIFFEN,  JR.,   Assistant  Attorney  General,  Fair                                                               
Business   Practices   Section,   Civil   Division   (Anchorage),                                                               
Department  Of Law,  in  response  to Representative  Gruenberg's                                                               
question, referred to  the [proposed] changes to  AS 08.66.015 as                                                               
a whole,  and noted that the  current statute is set  up into two                                                               
[subsections] (a) and (b).  It read as follows:                                                                                 
                                                                                                                                
     Sec. 08.66.015.  Sale of motor vehicle.                                                                                    
          (a) A person who does business as a dealer in the                                                                     
     state may not offer to sell  or sell a motor vehicle as                                                                    
     a new or  current model motor vehicle  unless the motor                                                                    
     vehicle  retains  the   manufacturer's  certificate  of                                                                    
     origin.                                                                                                                    
          (b) A person who does business as a dealer in the                                                                     
     state may not offer to sell  or sell a motor vehicle as                                                                    
     a  new   or  current  model  motor   vehicle  having  a                                                                    
     manufacturer's warranty unless                                                                                             
          (1) the dealer has a current sales and service                                                                        
     agreement  with  the  manufacturer  and  the  agreement                                                                    
     requires the  dealer, upon demand of  the motor vehicle                                                                    
     buyer, to  perform or arrange for,  within a reasonable                                                                    
     distance  of  the dealer's  place  of  business in  the                                                                    
     state, the repair and replacement  work required of the                                                                    
     manufacturer under the warranty; or                                                                                        
          (2) the dealer offers to give the buyer a rebate                                                                      
     to  cover  the repair  and  replacement  work that  the                                                                    
     dealer  cannot   perform  or   arrange  for   within  a                                                                    
     reasonable distance of the dealer's place of business.                                                                     
                                                                                                                                
MR. SNIFFEN  noted that the  proposed Version H would  remove the                                                               
"current  model"  language from  [subsection]  (a).   The  result                                                               
would be  that a  motor vehicle  with very low  miles on  it that                                                               
does not  have a certificate  of origin cannot  be sold as  a new                                                               
car, but would  have to be sold  as a used car.   Furthermore, he                                                               
noted, Version  H would change  the stipulations  in [subsection]                                                               
(b) for selling a current model motor vehicle.                                                                                  
                                                                                                                                
REPRESENTATIVE  GRUENBERG stated  that he  does not  question the                                                               
change to  subsection (a); however, regarding  subsection (b), he                                                               
asked  what   possible  harm  there   could  be  to   making  the                                                               
requirement concerning the manufacturer's  warranty also apply to                                                               
new vehicles.   He said, "It  seems to me to  be under-inclusive,                                                               
and it  may conceivably deny  some consumers of new  vehicles the                                                               
protection of subsection  (b).  He asked Mr. Sniffen  if he would                                                               
have a problem with keeping "new" vehicles in that subsection.                                                                  
                                                                                                                                
Number 1572                                                                                                                     
                                                                                                                                
MR.  SNIFFEN responded  that  in his  brief  immediate review  of                                                               
Version  H,  he doesn't  see  a  problem  with  that.   He  asked                                                               
Representative Gruenberg  to clarify that  he meant he  wants the                                                               
warranty requirement left in for new cars, as well.                                                                             
                                                                                                                                
REPRESENTATIVE GRUENBERG  said yes.   He explained that  his next                                                               
line of  questioning was going to  be to ask why  the language on                                                               
page  1, line  10, "[HAVING  A MANUFACTURER'S  WARRANTY UNLESS]",                                                               
couldn't  be  left  in,  as  well as  the  language  on  page  1,                                                               
beginning on line 12, to page 2, line 1, which read as follows:                                                                 
                                                                                                                                
     [AND THE AGREEMENT REQUIRES THE  DEALER, UPON DEMAND OF                                                                    
     THE  MOTOR VEHICLE  BUYER, TO  PERFORM OR  ARRANGE FOR,                                                                    
     WITHIN A  REASONABLE DISTANCE OF THE  DEALER'S PLACE OF                                                                    
     BUSINESS IN THE STATE,  THE REPAIR AND REPLACEMENT WORK                                                                    
     REQUIRED OF THE MANUFACTURER UNDER THE WARRANTY]; [OR]                                                                     
                                                                                                                                
REPRESENTATIVE  GRUENBERG  offered  his understanding  that  that                                                               
would provide a warranty protection;  in addition to the warranty                                                               
protections  under the  uniform commercial  code, which  apply to                                                               
the manufacturer, it would also add -  as a matter of state law -                                                               
a  dealer's  warranty.    He  opined  that  that's  an  important                                                               
additional protection to  have the dealer's warranty,  as well as                                                               
the manufacturer's warranty.                                                                                                    
                                                                                                                                
Number 1733                                                                                                                     
                                                                                                                                
MR.  SNIFFEN offered  his understanding  that the  initial reason                                                               
the new car  dealers wanted to remove that language  was to clean                                                               
up  the statute.    He said,  "I believe  they  didn't have  that                                                               
concern; if  in fact the  used car dealers weren't  selling these                                                               
current  model  motor  vehicles,  this becomes  much  less  of  a                                                               
concern.   Only in the  event that  they are allowed  to continue                                                               
those sales  would that  issue be  a concern."   He said  that he                                                               
doesn't have a problem leaving  that language in there, if that's                                                               
the will of the committee.                                                                                                      
                                                                                                                                
Number 1773                                                                                                                     
                                                                                                                                
REPRESENTATIVE GRUENBERG  said he is beginning  to understand the                                                               
problems between "these  two types of businesses," and  he is not                                                               
looking at the issue from  either profession's point of view, but                                                               
rather from the point of view of the Alaskan car buyer.                                                                         
                                                                                                                                
Number 1810                                                                                                                     
                                                                                                                                
REPRESENTATIVE CRAWFORD reiterated the  question he had asked Mr.                                                               
Allwine during  the May 15,  2003 meeting, regarding  whether the                                                               
language  covers  "lease fleet  vehicles,"  or  if that  language                                                               
should be  added to  [paragraph] (3)  [on page  2, lines  7-8, in                                                               
Version H].                                                                                                                     
                                                                                                                                
MR. SNIFFEN  said he thinks Mr.  Allwine was correct in  that the                                                               
language probably  covers those  transactions, but he  added that                                                               
he doesn't  think it  would hurt to  clarify that  in [paragraph]                                                               
(3).  In response to a  question by Chair Weyhrauch, he suggested                                                               
that  perhaps the  term "at  the end  of a  lease term"  could be                                                               
added to [paragraph] (3).  He said  he would have to give it some                                                               
thought to come up with the appropriate language.                                                                               
                                                                                                                                
Number 1895                                                                                                                     
                                                                                                                                
REPRESENTATIVE LYNN  asked what  is wrong  with the  language the                                                               
way it is.                                                                                                                      
                                                                                                                                
Number 1925                                                                                                                     
                                                                                                                                
MR. SNIFFEN opined that there is  probably not much wrong with it                                                               
the way  it is;  however, he  commented that  there is  a "little                                                               
gray area"  on the  lease issue, because  all the  exceptions [in                                                               
Version H]  deal with transactions  that arguably  could exclude,                                                               
for example,  a situation  where a dealership  may have  leased a                                                               
vehicle and the  lease had expired.  In that  case, he explained,                                                               
"they're  technically not  purchasing the  vehicle back  from the                                                               
consumer, it's  not a  repossession, it's not  in service  with a                                                               
rental fleet, [and] it hasn't  been purchased from an auction, so                                                               
that kind  of transaction is sort  of excluded from any  of those                                                               
exceptions."   He suggested an  exception to the effect  that "if                                                               
the vehicle is returned  to the dealer at the end  of a bona fide                                                               
lease from  the dealer", then  that might cover  that transaction                                                               
if it's a concern.                                                                                                              
                                                                                                                                
Number 1970                                                                                                                     
                                                                                                                                
REPRESENTATIVE  CRAWFORD said  he  thinks that  some people  turn                                                               
their vehicles in without fulfilling  the lease terms.  He asked,                                                               
"Does that language actually take care of it?"                                                                                  
                                                                                                                                
MR. SNIFFEN  responded that he is  trying to think as  fast as he                                                               
can and he is  not sure.  He proffered, "If you  have a bona fide                                                               
lease with  a dealer and  the vehicle  comes back to  the dealer,                                                               
I'm  trying to  determine if  there's  some way  that a  Canadian                                                               
vehicle  would be  leased  from  the dealer  in  this  way."   He                                                               
explained that  that's why he's  having trouble deciding  if that                                                               
language is really necessary.  He  revealed that he does not know                                                               
of many  transactions where the  current model  Canadian vehicles                                                               
coming back from a consumer under  a lease are really going to be                                                               
a  problem.     If  they   are,  he  added,  it   would  require,                                                               
essentially,  that a  dealer be  in  possession of  one of  these                                                               
Canadian vehicles,  which, theoretically, they shouldn't  be; so,                                                               
they  wouldn't  be  in  a   position  to  lease  these  vehicles.                                                               
However, he gave an example where  a consumer leases a vehicle in                                                               
Canada, or from  another dealer who "had one  of these vehicles,"                                                               
and the lease  term expires.  He  said it would just  go back the                                                               
dealer who  actually leased the  vehicle.   He said, "And  if you                                                               
want to include  those transactions in the  types of transactions                                                               
that we want to allow under  this statute, it might bear specific                                                               
attention."                                                                                                                     
                                                                                                                                
Number 2055                                                                                                                     
                                                                                                                                
REPRESENTATIVE  CRAWFORD  said  that  he  is  not  familiar  with                                                               
leases,  but  knows  that  he would  like  for  legitimate  lease                                                               
vehicles to  be covered in the  bill.  He added  that his concern                                                               
is not so  much whether the vehicles are Canadian  or for sale in                                                               
the  U.S., but  that he  wants to  ensure that  [the legislature]                                                               
isn't leaving legitimate business out of the list of exceptions.                                                                
                                                                                                                                
Number 2104                                                                                                                     
                                                                                                                                
REPRESENTATIVE  GRUENBERG  offered  an example  whereby  a  motor                                                               
vehicle  dealer  leases  a  three-year  leased  vehicle  to  "Joe                                                               
Consumer," and the vehicle is turned  back, or it's at the end of                                                               
the lease term.  At that  point, he noted, that vehicle would not                                                               
be for sale, unless the owner  of the vehicle, who would probably                                                               
be the  dealer, wanted  to sell  it.   He asked  for confirmation                                                               
that  the purchaser  who had  been  the lessee  doesn't have  any                                                               
right to sell it, because he's just renting it.                                                                                 
                                                                                                                                
MR.  SNIFFEN answered  that he  thinks  that's correct.   In  any                                                               
event, he  added, that  type of  transaction wouldn't  fall under                                                               
the language of  [AS 09.66.015], because it would no  longer be a                                                               
new or current model motor vehicle.                                                                                             
                                                                                                                                
REPRESENTATIVE GRUENBERG suggested  that if it was  a new vehicle                                                               
that  was leased  and  it  was turned  back  within  a couple  of                                                               
months, it would still be a  current year model vehicle.  But the                                                               
lessee,  he reiterated,  would not  have  any right  to sell  it,                                                               
because he/she doesn't own the vehicle.                                                                                         
                                                                                                                                
MR. SNIFFEN confirmed that that is correct.                                                                                     
                                                                                                                                
Number 2233                                                                                                                     
                                                                                                                                
REPRESENTATIVE  GRUENBERG stated  that he  is going  to offer  an                                                               
amendment as follows:   on page 1, line 9, add  back in the words                                                               
"new or";  on page 1, line  12, to page  2, line 1, add  back the                                                               
language "and the  agreement requires the dealer,  upon demand of                                                               
the  motor vehicle  buyer, to  perform or  arrange for,  within a                                                               
reasonable  distance of  the dealer's  place of  business in  the                                                               
state,  the   repair  and  replacement   work  required   of  the                                                               
manufacturer under the warranty; or".                                                                                           
                                                                                                                                
REPRESENTATIVE  GRUENBERG  indicated  that   he  didn't  want  to                                                               
formally offer the amendment until he had talked to Mr. Sniffen.                                                                
                                                                                                                                
Number 2316                                                                                                                     
                                                                                                                                
REPRESENTATIVE GRUENBERG  turned attention to Amendment  1, which                                                               
read as follows:                                                                                                                
                                                                                                                                
     Page 2, lines 2 - 3:                                                                                                       
          Delete "received as a trade-in"                                                                                   
          Insert "manufactured for sale in the United                                                                       
     States and acquired by the dealer"                                                                                     
                                                                                                                                
     Page 2, line 6:                                                                                                            
          Delete ";"                                                                                                        
          Insert "; or"                                                                                                     
                                                                                                                                
     Page 2, lines 7 - 10:                                                                                                      
          Delete all material and insert:                                                                                       
          "(3)  the vehicle is a current model used vehicle                                                                 
     not  manufactured for  sale in  the United  States, the                                                                
     dealer  acquired the  vehicle in  the normal  course of                                                                
     business, and the dealer complies with AS 45.25.470."                                                                  
                                                                                                                                
     Page 5, following line 19:                                                                                                 
     Insert a new bill section to read:                                                                                         
        "* Sec. 5.  AS 45.25.470 is amended to read:                                                                        
          Sec. 45.25.470.  Sales of vehicles manufactured                                                                     
     for sale  in a foreign country.   Before sale of  [,] a                                                              
     motor vehicle  not manufactured for sale  in the United                                                                
     States, a  motor vehicle dealer  shall disclose  to the                                                            
     consumer  in   writing,  in   addition  to   any  other                                                            
     disclosures required for the sale  of a used [WHETHER A                                                                
     MOTOR] vehicle,  [WAS ORIGINALLY MANUFACTURED  FOR SALE                                                                
     IN CANADA OR ANOTHER FOREIGN COUNTRY]                                                                                      
               (1)  that the vehicle was originally                                                                         
     manufactured for  sale in  Canada or  another specified                                                                
     foreign country;                                                                                                       
               (2)  if applicable, that the vehicle was                                                                     
     originally sold  new in  the specified  foreign country                                                                
     identified under (1) of this  section and imported into                                                                
     the United States;                                                                                                     
               (3)  that the vehicle's odometer was                                                                         
     converted from  kilometers to miles, and  shall provide                                                                
     the consumer  with a legal  vehicle title,  an odometer                                                                
     verification  certificate,  or  another  document  that                                                                
     verifies the mileage reading after the conversion;                                                                     
               (4)  if applicable, that the vehicle does                                                                    
     not have a manufacturer's warranty; and                                                                                
               (5)  any other information required by                                                                       
     regulations adopted by the attorney general."                                                                          
                                                                                                                                
     Renumber the following bill sections accordingly.                                                                          
                                                                                                                                
REPRESENTATIVE  GRUENBERG  noted  that  if  Amendment  1  is  not                                                               
adopted, then the  language on page 2, lines 7-10,  of Version H,                                                               
would not be deleted.  The language read as follows:                                                                            
                                                                                                                                
               (3) the vehicle has been purchased directly                                                                  
     from a  consumer in the  United States for  purposes of                                                                
     resale;                                                                                                                
               (4) the vehicle has been in service with a                                                                   
     bona fide rental fleet for at least five months;                                                                       
                                                                                                                                
REPRESENTATIVE GRUENBERG said that the  term "five months" may be                                                               
hard on  people in  Fairbanks and  the north  part of  the state,                                                               
because the  rental season there  is less than five  months long.                                                               
He  commented that  there have  been suggestions  to [change  the                                                               
language  in the  bill] to  "three months"  or "four  months", so                                                               
that the vehicle could be sold  after one rental season.  He said                                                               
he would  probably leave Amendment  1 for Representative  Holm to                                                               
offer, or at  least for him to be present,  because he represents                                                               
Fairbanks.                                                                                                                      
                                                                                                                                
Number 2390                                                                                                                     
                                                                                                                                
REPRESENTATIVE  GRUENBERG  began  discussion of  what  later  was                                                               
labeled Amendment 5, which read  as follows [original punctuation                                                               
provided]:                                                                                                                      
                                                                                                                                
     Page 2, lines 27-28:                                                                                                       
          Delete "represent that a savings occurs at a                                                                      
     lower [HAVE OCCURRED AT THAT] price."                                                                                  
          Insert "represent that a buyer would save money                                                                   
     by  paying a  [HAVE  OCCURRED AT  THAT]  price that  is                                                            
     lower   than  the   "manufacturer's  suggested   retail                                                                
     price," "MSRP," or "list price"."                                                                                      
                                                                                                                                
REPRESENTATIVE  GRUENBERG referred  to  page 2,  lines [24-28  of                                                               
Version H], which read as follows:                                                                                              
                                                                                                                                
               (3) whenever using the term "manufacturer's                                                                      
     suggested retail  price," "MSRP," or "list  price," the                                                                    
     dealer [SHALL PROVIDE IN THE  ADVERTISEMENT A CLEAR AND                                                                    
     CONSPICUOUS  DISCLOSURE THAT  STATES THAT  A SALE]  may                                                                    
     not represent  that a savings  occurs at a  lower [HAVE                                                                
     OCCURRED AT THAT] price.                                                                                                   
                                                                                                                                
REPRESENTATIVE  GRUENBERG  offered  his  understanding  that  the                                                               
problem  that  [paragraph]  (3),  on  page  2,  lines  24-28,  is                                                               
designed to cure is the fact  that very few vehicles are actually                                                               
sold  at  manufacturer's  suggested   retail  price  (MSRP),  but                                                               
generally are  sold at  a lower price,  and customers  don't know                                                               
that.  He asked if "that whole  part of the bill" was designed to                                                               
require dealers to  let customers know that  usually vehicles are                                                               
sold at lower prices.                                                                                                           
                                                                                                                                
Number 2448                                                                                                                     
                                                                                                                                
MR. SNIFFEN answered,  "In part, yes."  He said  there has been a                                                               
practice  in  the  past where  dealers  will  run  advertisements                                                               
comparing prices  to MSRP, or other  prices.  He said  a new auto                                                               
dealer  Act  was structured  under  AS  45.25 to  prohibit  price                                                               
comparison advertisement, except with  MSRP prices, which he said                                                               
are  such  nationally  known  numbers  that  often  are  seen  on                                                               
television.   He said that a  price [on a vehicle]  that is lower                                                               
than the  MSRP gives  the impression to  consumers that  they are                                                               
receiving some  kind of a savings,  when in fact the  vehicle may                                                               
have never been sold at the  MSRP price, but may have been higher                                                               
or  lower.    He  said,  "We   had  put  that  section  in  here,                                                               
Representative  Gruenberg, to  make  it clear  to consumers  that                                                               
when they  see those  kinds of advertisements,  ... they  may not                                                               
actually be saving money."                                                                                                      
                                                                                                                                
REPRESENTATIVE GRUENBERG  stated that  although it seemed  to him                                                               
that the purpose  of the amendment in [Version H]  was to clarify                                                               
the language,  he thought that  Amendment [5] would make  it even                                                               
clearer.  He asked Mr. Sniffen if he agreed.                                                                                    
                                                                                                                                
Number 2600                                                                                                                     
                                                                                                                                
CHAIR  WEYHRAUCH  questioned  Mr.   Sniffen  to  find  out  which                                                               
amendments he had received by facsimile.                                                                                        
                                                                                                                                
CHAIR  WEYHRAUCH mentioned  issues that  had been  raised by  Mr.                                                               
Coffey at a previous hearing on HB  272.  He asked if Mr. Sniffen                                                               
had any comments in that regard.                                                                                                
                                                                                                                                
Number 2627                                                                                                                     
                                                                                                                                
MR. SNIFFEN prefaced  his comments by opining that  Mr. Coffey is                                                               
an  excellent lawyer  who is  representing the  interests of  Mr.                                                               
Lyberger well.  Notwithstanding that,  he stated that he thinks a                                                               
lot  of  the   concerns  that  Mr.  Coffey  has   are  "just  not                                                               
substantiated."  He continued as follows:                                                                                       
                                                                                                                                
     The "takings issue" is really nothing that I think has                                                                     
     any merit to it for ... one simple reason:  We have a                                                                      
     law  that's  been in  place  since  1993, that  already                                                                    
     prohibits the  conduct that's  currently going  on, and                                                                    
     Mr. Lyberger,  for example, opened his  shop after that                                                                    
     law was  in place and knew  of the law when  he engaged                                                                    
     in his business.  I  don't think a "taking claim" would                                                                    
     survive very long, under those facts.                                                                                      
                                                                                                                                
     He also  mentioned some concerns  with NAFTA, and  I am                                                                    
     by no means a NAFTA expert.   And I have looked through                                                                    
     the provisions of NAFTA, and  I find it curious that no                                                                    
     one -  Ms. Urban, Mr. Coffey,  no one - has  pointed to                                                                    
     any  specific provision  of  that  agreement that  this                                                                    
     legislation could  possibly violate.  I  haven't seen a                                                                    
     citation to,  you know, Chapter  3, Section  1.65, that                                                                    
     says the  legislature in the  state shall not  do this.                                                                    
     And no  one's been  able to  point me  to any  of those                                                                    
     provisions, so  I'm skeptical that there  are any NAFTA                                                                    
     concerns at  all.  The  provision I looked at  in NAFTA                                                                    
     didn't  seem to  indicated  that there  was a  problem.                                                                    
     And,  if  there was  a  problem,  it's a  problem  that                                                                    
     already  exists under  our current  law.   So,  nothing                                                                    
     that HB 272 does could  possibly be any worse than what                                                                    
     we currently have.                                                                                                         
                                                                                                                                
     So,   these  NAFTA   concerns  and   these  competition                                                                    
     concerns,   and   our   trust   concerns   are   really                                                                    
     irrelevant,  because if  there  are  concerns, then  we                                                                    
     already have them, and this  bill isn't going to change                                                                    
     that.   If anything,  this bill relaxes  those concerns                                                                    
     to the extent  that it carves out  these exceptions now                                                                    
     that everyone can  use to transact in  certain types of                                                                    
     vehicles.  So, in that  sense this is a pro-competitive                                                                    
     piece  of  legislation,  because it's  opening  up  the                                                                    
     markets for  new and used  car dealers to  sell certain                                                                    
     kinds of  cars that  are already prohibited  from being                                                                    
     sold.                                                                                                                      
                                                                                                                                
     So, I don't  have the concerns for NAFTA,  or the anti-                                                                    
     trust concerns,  or these  "taking concerns"  that I've                                                                    
     heard raised.   Our  supreme court might  disagree with                                                                    
     me  down the  road on  that,  but our  review of  these                                                                    
     issues just doesn't warrant that kind of concern.                                                                          
                                                                                                                                
Number 2764                                                                                                                     
                                                                                                                                
REPRESENTATIVE SEATON stated that he has some concerns regarding                                                                
NAFTA.  He said the entire idea of NAFTA, whether "we" agree                                                                    
with it or not, was to  open trade between "the countries."  When                                                               
[the  legislature] says  it's  going to  restrict  that trade  to                                                               
certain individuals,  he said he  thinks there  are possibilities                                                               
of  problems.   He  added,  "And  definitely  it  seems to  be  a                                                               
restriction in the  philosophy of where the country  has gone and                                                               
is  continuing  to  go  since   we've  given  the  president  the                                                               
authority to negotiate  on ... other free trade  agreements."  He                                                               
said  that  he  doesn't  know   that  there  are  any  particular                                                               
provisions  of  NAFTA  that  are  being  considered  for  change;                                                               
however, he  commented that, basically,  what is  being discussed                                                               
is a restriction of sales between  Canada and the U.S., by saying                                                               
that the trade between the U.S.  and Canada could only be through                                                               
certain individuals for  a certain period of time each  year.  He                                                               
concluded  that  that's his  concern  with  the interaction  with                                                               
NAFTA.                                                                                                                          
                                                                                                                                
Number 2830                                                                                                                     
                                                                                                                                
MS.  SYLVESTER  proffered  that   NAFTA  is  irrelevant  for  the                                                               
following  reason:    The  methods through  which  a  broker  can                                                               
acquire a used  vehicle are itemized.  Excluded  are new vehicles                                                               
illicitly acquired from a manufacturer.   She indicated that, for                                                               
example, a  franchised dealer in  California or  Washington State                                                               
who has a deal with a  broker and is selling "these new vehicles"                                                               
to the  broker at a cut  rate would be excluded  as well, because                                                               
"it's not  acquired in  these same ways."   Currently,  she said,                                                               
there's a market condition based  on the favorable exchange rate,                                                               
coupled with recent changes and  modifications, that made it much                                                               
cheaper  for  Canadian  market   vehicles  to  be  converted  "to                                                               
American  standards."   She added,  "There's no  guarantee that's                                                               
going to stay."   She explained that that just  happens to be the                                                               
current popular source of the  illicit vehicles that are required                                                               
outside  of  the  manufacturer's  franchise  agreement  with  the                                                               
dealers.  She  added, "And that's something that  Alaska law, and                                                               
every ...  state in the  U.S. supports."   She concluded,  "In no                                                               
way  are we  saying that  NAFTA  is intended  to protect  illicit                                                               
trade."                                                                                                                         
                                                                                                                                
REPRESENTATIVE SEATON stated the following:                                                                                     
                                                                                                                                
     I  am quite  opposed to  the characterization  of this,                                                                    
     because these  vehicles are  legally imported  into the                                                                    
     U.S. by registered importers that  are ... certified by                                                                    
     the Department  of Transportation.   So, you  are going                                                                    
     back  and  presuming  a   method  of  something  that's                                                                    
     happening  in Canada  before the  vehicles are  legally                                                                    
     imported into the  U.S.  And so, to say  that these are                                                                    
     [fraudulent] or  illegal actions is  totally incorrect,                                                                    
     because  everything that  is happening  in the  U.S. --                                                                    
     now  it may  be  in violation,  possibly, between  some                                                                    
     manufacturer  and their  own  personal agreements  with                                                                    
     people  they  sell  their   cars  to;  however  they're                                                                    
     continuing to sell those cars to those people.                                                                             
                                                                                                                                
     We  had testimony  yesterday  from  the importers  that                                                                    
     said  that  these  were  fleet   sales  that  are  done                                                                    
     legally.    I haven't  seen  anything  other than  just                                                                    
     postulations  that college  students  are buying  this.                                                                    
     We haven't  seen anybody refute that  these fleet deals                                                                    
     that  give extreme  discounts and  then are  imported -                                                                    
     that  those are  illegal in  our  country.   So, I  get                                                                    
     disturbed when we  say that these are  illegal, when we                                                                    
     have  legal importers  that are  licensed and  that are                                                                    
     bringing  these in,  and that  people can  buy them  --                                                                    
     unless we  want to make  them illegal.  But  of course,                                                                    
     under  Alaska  law,  it's illegal  for  the  franchised                                                                    
     dealers to buy them, as  well; it's illegal for anybody                                                                    
     right now.                                                                                                                 
                                                                                                                                
TAPE 03-68, SIDE B                                                                                                            
Number 2985                                                                                                                     
                                                                                                                                
MR.  SNIFFEN  concurred  that   the  importation  process  itself                                                               
perhaps is legitimate, legal, and  in accordance with federal and                                                               
state  requirements.   He noted  that  the idea  of a  registered                                                               
importer sounds more  grandiose than it actually is.   He said it                                                               
is  probably  easier to  become  a  registered importer  than  to                                                               
become  a car  dealer in  Alaska.   He  added, "You  fill out  an                                                               
application  and you  post a  bond."   He noted  that there's  no                                                               
training or  text, for  example, and  no other  requirement other                                                               
than perhaps a background check.  He continued as follows:                                                                      
                                                                                                                                
     And  it would  be  curious to  get  a national  highway                                                                    
     traffic safety administration  person familiar with the                                                                    
     import issues  to testify before this  committee, and I                                                                    
     would  suspect   you  would  find   that  there   is  a                                                                    
     tremendous  amount of  import fraud  that takes  place.                                                                    
     And I'm  not sure  that just  saying, "Well,  these are                                                                    
     legally imported, ... direct  to some of these consumer                                                                    
     concerns" -- although I cannot  deny that there's a lot                                                                    
     of truth  to that:   that the  conduct that  perhaps is                                                                    
     illicit  is  something   that's  occurring  outside  of                                                                    
     Alaska  and  Canada.   And  you  know,  perhaps  that's                                                                    
     conduct that we should be concerned with.                                                                                  
                                                                                                                                
Number 2900                                                                                                                     
                                                                                                                                
MR. SNIFFEN  referred to  the previous  testimony of  "Ms. Urban"                                                               
[on  May  15, 2003]  that  there  are 210,000  Canadian  vehicles                                                               
legally imported.   He said he  would be curious to  find out how                                                               
many  of those  were current-model  vehicles with  less than  150                                                               
miles on them, for example.  He  said he bets a majority of those                                                               
vehicles  with  less  than  150  miles on  them  have  come  into                                                               
possession  of the  importers  in some  "interesting  ways."   He                                                               
added, "And I'm  not going to say illegal, or  even illicit; it's                                                               
just [that]  we've heard testimony  from other folks  about that,                                                               
and we haven't done an investigation  in our office to verify any                                                               
of those  things, so we  can't speak with  any authority on  it -                                                               
only what we've heard."                                                                                                         
                                                                                                                                
CHAIR WEYHRAUCH  returned the committee's attention  to a portion                                                               
of Representative  Gruenberg's possible  amendment, to  leave the                                                               
words "new or" on page 1, line 9.                                                                                               
                                                                                                                                
MR. SNIFFEN  said he doesn't know  if that would violate  some of                                                               
the  intent  that  the  new  car dealers  "were  thinking  of  by                                                               
removing that  language," but  he said he  can't see  any problem                                                               
with that [amendment, if proposed].                                                                                             
                                                                                                                                
Number 2843                                                                                                                     
                                                                                                                                
REPRESENTATIVE SEATON said he wasn't  sure why "or current model"                                                               
is in there.  He offered  his understanding that the desire is to                                                               
prevent someone from offering to sell  a motor vehicle as new [if                                                               
it isn't].                                                                                                                      
                                                                                                                                
Number 2831                                                                                                                     
                                                                                                                                
REPRESENTATIVE  GRUENBERG returned  attention  to Amendment  [5].                                                               
He  referred to  the  added  language in  Version  H  on page  2,                                                               
line 27,  which  read, "represent  that  a  savings occurs  at  a                                                           
lower".   He clarified that  with Amendment [5], [page  2], lines                                                           
27-28  of  Version  H  would  read  as  follows  [punctuation  as                                                               
stated]:                                                                                                                        
                                                                                                                                
       may not represent that a buyer would save money by                                                                       
     paying a price that is lower than the "manufacturer's                                                                      
     suggested retail price", "MSRP," or "list price".                                                                          
                                                                                                                                
REPRESENTATIVE GRUENBERG suggested the  foregoing is more clearly                                                               
written and asked Mr. Sniffen his opinion.                                                                                      
                                                                                                                                
MR. SNIFFEN answered that he believes it sounds fine.                                                                           
                                                                                                                                
Number 2728                                                                                                                     
                                                                                                                                
REPRESENTATIVE GRUENBERG asked why Section 3  is in the bill.  He                                                               
said  the current  [statutory]  language looks  good  to him  and                                                               
covers both  new and used  vehicles as  well as related  goods or                                                               
services.  It is a much broader protection.                                                                                     
                                                                                                                                
MR. SNIFFEN replied:                                                                                                            
                                                                                                                                
     We had modified that section  because I don't know that                                                                    
     anyone could come up with  a really good definition for                                                                    
     "related  goods".   And the  intention of  this section                                                                    
     was  to make  sure  dealers weren't  advertising for  a                                                                    
     whole bunch  of cars when,  in fact, they only  had one                                                                    
     at that price.   You might have  seen advertisements in                                                                    
     the past that  would lead a consumer  to suggest, "Hey,                                                                    
     Cal Worthington  has 55 Ford Explorers  at this price."                                                                    
     And you  would go down  there and they'd say,  "Oh, no,                                                                    
     that   was  ...   one  car   at  ...   this  particular                                                                    
     configuration, and  we don't have that  one anymore; it                                                                    
     sold a  week ago.   But,  hey, we  have these  other 45                                                                    
     Explorers that are kind of the same."                                                                                      
                                                                                                                                
Number 2663                                                                                                                     
                                                                                                                                
REPRESENTATIVE GRUENBERG  said Mr.  Sniffen had convinced  him to                                                               
limit  it to  the  vehicles  themselves.   He  asked whether  his                                                               
feeling is that  these used vehicles are a  little different from                                                               
each other and hence this should be limited to new vehicles.                                                                    
                                                                                                                                
MR.  SNIFFEN answered  in the  affirmative.   He added  that used                                                               
vehicles,  by  their  nature,  are  unique;  having  an  expected                                                               
quantity of specific used vehicles didn't make any sense.                                                                       
                                                                                                                                
Number 2632                                                                                                                     
                                                                                                                                
REPRESENTATIVE   GRUENBERG  turned   attention   to  Section   4,                                                               
[paragraph  (1)], found  on page  3,  lines 7-13,  of Version  H.                                                               
Noting that  the current [statutory] language  appears to require                                                               
advertisements  to  include  "taxes   and  everything  else,"  he                                                               
offered  his understanding  that the  proposed legislation  would                                                               
eliminate this requirement because it is "too variable."                                                                        
                                                                                                                                
MR.  SNIFFEN cited  variability  and that  the  language is  very                                                               
confusing.    He  offered  his   belief  that  the  new  language                                                               
accomplishes exactly the same thing but is much easier to read.                                                                 
                                                                                                                                
REPRESENTATIVE  GRUENBERG  said he  didn't  have  a problem  with                                                               
that.    Continuing   with  Section  4,  he   drew  attention  to                                                               
[paragraph (10)],  found on  page 4, lines  21-23, of  Version H.                                                               
He  said he  gathers  that  it isn't  really  a problem,  "people                                                               
passing things  off as  being offered  by a  private party."   He                                                               
added that he doesn't know what a "motor vehicle agent" is.                                                                     
                                                                                                                                
MR. SNIFFEN  explained that the  language is being  excluded from                                                               
current  law  because  "we  didn't  really  know  that  it  added                                                               
anything to the  revised version."  He added that  the intent is,                                                               
if a  vehicle is to  be offered for sale  or lease, "you  have to                                                               
include ... your name if you are a dealer."                                                                                     
                                                                                                                                
Number 2535                                                                                                                     
                                                                                                                                
REPRESENTATIVE GRUENBERG responded that  he didn't have a problem                                                               
with  that.   He then  surmised that  the reason  for eliminating                                                               
[paragraph (11)]  on page 4,  lines 25-29,  of Version H  is that                                                               
sometimes sales are extended longer than was originally thought.                                                                
                                                                                                                                
MR. SNIFFEN affirmed that and explained:                                                                                        
                                                                                                                                
     We  found  that  there   were  some  promotional  deals                                                                    
     offered  by  manufacturers  to  dealers  that  did  not                                                                    
     really have  an ending date;  they would be  very open-                                                                    
     ended.  So  if the end of the month  came along and you                                                                    
     had  an advertisement  that said,  "Hey, come  in until                                                                    
     March 30th  to take advantage  of this deal,"  and then                                                                    
     the manufacturer  called you up and  said, "Well, we're                                                                    
     extending this  promotion for another 15  days," you as                                                                    
     a  dealer  wouldn't  be able  to  participate  in  that                                                                    
     extended  promotion because  you've already  advertised                                                                    
     and you had to do it within a certain timeframe.                                                                           
                                                                                                                                
Number 2501                                                                                                                     
                                                                                                                                
REPRESENTATIVE  GRUENBERG turned  attention  to [paragraph  (12),                                                               
beginning on page  4, line 30, of  Version H].  He  asked why the                                                               
current  [statutory]  language  isn't being  retained,  since  it                                                               
seems to protect consumers against  unscrupulous people who would                                                               
require the purchase  of not only the vehicle,  but also features                                                               
that are added at the dealership.                                                                                               
                                                                                                                                
MR. SNIFFEN answered:                                                                                                           
                                                                                                                                
     We  couldn't  come  up  with   a  good  situation  that                                                                    
     actually  was  occurring  in  the  normal  practice  of                                                                    
     selling cars where a buyer  wouldn't know what was on a                                                                    
     vehicle when  they went into  a car dealer  to purchase                                                                    
     it.  And  the example that I like to  use is that block                                                                    
     heaters  in  Alaska,  which  are   very  common,  if  a                                                                    
     customer came into a dealership  and said, "I want this                                                                    
     car, but  I see  you've installed  a block  heater, and                                                                    
     that's  not   something  that  was  installed   by  the                                                                    
     factory, I want  you to take it off,"  it would require                                                                    
     the  dealer to  take that  off.   Sometimes these  cars                                                                    
     come  in and  dealers will  put accessories  on them  -                                                                    
     sometimes spoilers or mud flaps  or little things - and                                                                    
     this language  required dealers to  actually go  in and                                                                    
     disassemble those  things if they weren't  installed by                                                                    
     the factory.                                                                                                               
                                                                                                                                
     And  there are  some things  that come,  actually, with                                                                    
     the vehicles,  that the factory asked  the dealer[s] to                                                                    
     install themselves.   And there  was an argument  to be                                                                    
     made that if it didn't  come off the barge with [these]                                                                    
     things ...  on there  from the factory,  that ...  if a                                                                    
     consumer  wanted to  force the  issue, they  could make                                                                    
     you take those things off  before they took delivery of                                                                    
     the  vehicle  --  and  it wouldn't  make  the  car  any                                                                    
     cheaper;  it would  just mean  that these  things would                                                                    
     have  to come  off.   And we  didn't see  any practical                                                                    
     application for that in  the normal transaction between                                                                    
     a dealer ...  and a consumer.                                                                                              
                                                                                                                                
REPRESENTATIVE GRUENBERG  surmised that  it wasn't  as much  of a                                                               
problem as  it might appear  to be  to a layperson  like himself.                                                               
He said he was  willing to bow to Mr. Sniffen on  that issue.  He                                                               
announced that this completed his questions on Section 4.                                                                       
                                                                                                                                
Number 2374                                                                                                                     
                                                                                                                                
REPRESENTATIVE   GRUENBERG  turned   attention   to  Section   5.                                                               
Referring to existing  language on page 5, lines  24-25, he asked                                                               
why  this is  limited to  the  sale of  new motor  vehicles.   He                                                               
suggested striking  "new" and providing  this protection  for the                                                               
sale of all motor vehicles.                                                                                                     
                                                                                                                                
MR.  SNIFFEN answered  that  this  relates to  when  a new  motor                                                               
vehicle comes  in off a barge  with some damage that  is repaired                                                               
by  the dealer  and  hence  the consumer  doesn't  know that  the                                                               
vehicle wouldn't be in new condition without this repair.                                                                       
                                                                                                                                
Number 2377                                                                                                                     
                                                                                                                                
REPRESENTATIVE  GRUENBERG said  that answered  his question.   He                                                               
then  expressed concern  about the  following proposed  phrase on                                                               
page 5,  line 28:   ", or $1,000,  whichever amount  is greater".                                                           
He said  it seems  to be  lessening consumer  protection, because                                                               
$1,000  is 5  percent  of  a vehicle  costing  $20,000.   If  the                                                               
vehicle  is being  sold  for less  - $15,00  for  example -  that                                                               
amount would  only be $750, he  noted.  In other  words, he said,                                                               
"This  protection  wouldn't  kick   in,  whereas,  under  current                                                               
language it is  for cheaper cars."  He noted  that the people who                                                               
buy cheaper cars  are generally people without as  much money who                                                               
really need  the protection even  more than people with  a little                                                               
more means.                                                                                                                     
                                                                                                                                
Number 2310                                                                                                                     
                                                                                                                                
REPRESENTATIVE GRUENBERG  said that he  would like to  delete "or                                                           
$1,000,",  because  he  said  he  thinks  it  not  good  for  the                                                           
consumers,  particularly folks  who live  in parts  of town  like                                                               
his.                                                                                                                            
                                                                                                                                
Number 2277                                                                                                                     
                                                                                                                                
MR. SNIFFEN  remarked that that's  an excellent  observation, and                                                               
he added that it is  curious, because [Representative Gruenberg's                                                               
point] is the exact reason why  that language was included in the                                                               
first place.  He said that  [the language] wasn't [added with the                                                               
intention] to not provide consumers protection.                                                                                 
                                                                                                                                
MR. SNIFFEN  explained that there  are dealers who sell  cars for                                                               
under $10,000,  and when they  get some  of these cars  they find                                                               
they have little  scratches on the fender, for  example, and they                                                               
might have  to spend $500 in  labor to buff out  the scratches or                                                               
replace a  panel.  The  cost of  doing those repairs  can quickly                                                               
exceed the  5 percent limit  that is in statute;  therefore, [one                                                               
of the  dealers] asked for the  rule to be relaxed  a little, for                                                               
the reason  that if they do  work on a low-value  car, they would                                                               
have  to  disclose  [that  information],   which  could  make  it                                                               
difficult  to  sell  the  car,  or  might  create  some  kind  of                                                               
impression that the car really  isn't new, whereas dealers who do                                                               
exactly the  same thing on  higher-valued cars would not  have to                                                               
disclose this type of work.                                                                                                     
                                                                                                                                
MR. SNIFFEN  stated that he  would have no objection  to removing                                                               
that language if that's the will  of the committee.  He suggested                                                               
perhaps  another  number  could  be  chosen,  perhaps  $800,  for                                                               
example.   He explained  that a  limit needed to  be put  in that                                                               
would allow  all dealers to at  least work up to  a certain range                                                               
without making disclosures - to level the playing field.                                                                        
                                                                                                                                
Number 2168                                                                                                                     
                                                                                                                                
REPRESENTATIVE GRUENBERG  asked if "dings," for  example wouldn't                                                               
come under the phrase, "cosmetic parts", on page 5, line 30.                                                                    
                                                                                                                                
MR.  SNIFFEN  said  it  would  not,  because  the  cosmetic  part                                                               
language is  intended to include  things that can be  replaced in                                                               
whole, like  bumpers, for  example.  In  response to  a follow-up                                                               
question by Chair Weyhrauch, he said  that a hubcap would also be                                                               
an example of a cosmetic part.                                                                                                  
                                                                                                                                
Number 2130                                                                                                                     
                                                                                                                                
REPRESENTATIVE GRUENBERG  announced that he would  probably bring                                                               
up, for the  purpose of discussion, reducing the  $1,000 to $800,                                                               
which was the amount that Mr. Sniffen suggested.                                                                                
                                                                                                                                
Number 2100                                                                                                                     
                                                                                                                                
CHAIR WEYHRAUCH asked  if anyone had any  thoughts regarding that                                                               
possible change.                                                                                                                
                                                                                                                                
Number 2089                                                                                                                     
                                                                                                                                
REPRESENTATIVE  CRAWFORD commented  that  the  way vehicles  cost                                                               
today, he  doesn't think there's  a huge difference  between $800                                                               
and $1,000.                                                                                                                     
                                                                                                                                
CHAIR WEYHRAUCH said that he feels  $1,000 is an easier number to                                                               
work with.                                                                                                                      
                                                                                                                                
REPRESENTATIVE LYNN indicated that he is not concerned.                                                                         
                                                                                                                                
REPRESENTATIVE  GRUENBERG said,  "Okay,  well we  will not  worry                                                               
about that then."                                                                                                               
                                                                                                                                
Number 2060                                                                                                                     
                                                                                                                                
CHAIR WEYHRAUCH asked if there  were any questions on Sections 6,                                                               
7, and  8.  There being  none, he said the  committee would focus                                                               
on Section 1.                                                                                                                   
                                                                                                                                
[The hearing on  HB 272 was temporarily suspended  to address the                                                               
next bill.]                                                                                                                     
                                                                                                                                
HB 272-MOTOR VEHICLE DEALERS                                                                                                  
                                                                                                                                
Number 0045                                                                                                                     
                                                                                                                                
CHAIR  WEYHRAUCH announced  that  the committee  would return  to                                                               
HOUSE BILL NO.  272, "An Act relating to  motor vehicle dealers."                                                               
Before the committee was the  proposed committee substitute (CS),                                                               
Version 22-LS0975\H, Bannister, 5/14/03.                                                                                        
                                                                                                                                
Number 0160                                                                                                                     
                                                                                                                                
REPRESENTATIVE  CRAWFORD  moved to  adopt  [a  new] Amendment  1,                                                               
which read as follows [original punctuation provided]:                                                                          
                                                                                                                                
     Page 2, Line 11:                                                                                                           
     Insert  "The vehicle  is a  current model  used vehicle                                                                    
     that  has  been  leased  by a  consumer  and  has  been                                                                    
     returned to the leasing dealer; or"                                                                                        
                                                                                                                                
     Renumber accordingly                                                                                                       
                                                                                                                                
REPRESENTATIVE CRAWFORD stated that he believes fleet vehicles                                                                  
need to be included, and Amendment 1 would do that.                                                                             
                                                                                                                                
Number 0189                                                                                                                     
                                                                                                                                
REPRESENTATIVE  GRUENBERG   referred  to  a   two-page  amendment                                                               
labeled  [23-LS0975\H.1, Bannister,  5/15/03], which  he said  he                                                               
had  referred  to previously  as  [Amendment]  1, which  read  as                                                               
follows:                                                                                                                        
                                                                                                                                
     Page 2, lines 2 - 3:                                                                                                       
          Delete "received as a trade-in"                                                                                   
          Insert "manufactured for sale in the United                                                                       
     States and acquired by the dealer"                                                                                     
                                                                                                                                
     Page 2, line 6:                                                                                                            
          Delete ";"                                                                                                        
          Insert "; or"                                                                                                     
                                                                                                                                
     Page 2, lines 7 - 13:                                                                                                      
          Delete all material and insert:                                                                                       
          "(3)  the vehicle is a current model used vehicle                                                                 
     not  manufactured for  sale in  the United  States, the                                                                
     dealer  acquired the  vehicle in  the normal  course of                                                                
     business, and the dealer complies with AS 45.25.470."                                                                  
                                                                                                                                
     Page 5, following line 22:                                                                                                 
     Insert a new bill section to read:                                                                                         
        "* Sec. 5.  AS 45.25.470 is amended to read:                                                                        
          Sec. 45.25.470.  Sales of vehicles manufactured                                                                     
     for sale in a foreign country.   Before the sale of [,]                                                          
     a  motor  vehicle  not manufactured  for  sale  in  the                                                                
     United States,  a motor  vehicle dealer  shall disclose                                                                
     to the  consumer in writing,  in addition to  any other                                                            
     disclosures required for the sale  of a used [WHETHER A                                                                
     MOTOR] vehicle,  [WAS ORIGINALLY MANUFACTURED  FOR SALE                                                                
     IN CANADA OR ANOTHER FOREIGN COUNTRY]                                                                                      
               (1)  that the vehicle was originally                                                                         
     manufactured for  sale in  Canada or  another specified                                                                
     foreign country;                                                                                                       
               (2)  if applicable, that the vehicle was                                                                     
      originally sold new in the specified foreign country                                                                  
     identified under (1) of this section and imported into                                                                 
     the United States;                                                                                                     
               (3)  that the vehicle's odometer was                                                                         
     converted from  kilometers to miles, and  shall provide                                                                
     the consumer  with a legal  vehicle title,  an odometer                                                                
     verification  certificate,  or  another  document  that                                                                
     verifies the mileage reading after the conversion;                                                                     
               (4)  if applicable, that the vehicle does                                                                    
     not have a manufacturer's warranty; and                                                                                
               (5)  any other information required by                                                                       
     regulations adopted by the attorney general."                                                                          
                                                                                                                                
     Renumber the following bill sections accordingly.                                                                          
                                                                                                                                
REPRESENTATIVE   GRUENBERG   noted    that   if   the   committee                                                               
subsequently   adopts   that   amendment  [Version   H.1],   then                                                               
Representative   Crawford's  Amendment   1  would   become  moot;                                                               
however,  he said,  "But I  have no  objection to  this being  in                                                               
there with that understanding."                                                                                                 
                                                                                                                                
Number 0259                                                                                                                     
                                                                                                                                
CHAIR   WEYHRAUCH   asked  if   there   was   any  objection   to                                                               
[Representative  Crawford's]   Amendment  1.    There   being  no                                                               
objection, it was so ordered.                                                                                                   
                                                                                                                                
Number 0425                                                                                                                     
                                                                                                                                
The committee took an at-ease from 1:47 p.m. to 1:48 p.m.                                                                       
                                                                                                                                
Number 0486                                                                                                                     
                                                                                                                                
MR.  SNIFFEN,  in  response  to a  comment  by  Chair  Weyhrauch,                                                               
confirmed that  he did draft  the language of Amendment  1, which                                                               
was just adopted.                                                                                                               
                                                                                                                                
Number 0600                                                                                                                     
                                                                                                                                
REPRESENTATIVE  GRUENBERG   offered  Amendment  2   [labeled  23-                                                               
LS0975\H.3,  Bannister,  5/15/03,  which was  originally  labeled                                                               
Amendment 3], which read as follows:                                                                                            
                                                                                                                                
     Page 6, following line 1:                                                                                                  
          Insert a new bill section to read:                                                                                    
        "* Sec. 6.  AS 45.25 is amended by adding a new                                                                     
     section to read:                                                                                                           
          Sec. 45.25.530.  Disclosure regarding receipt of                                                                    
     commissions.    If  a motor  vehicle  dealer's  service                                                                  
     operations  employees  receive  a  commission  for  the                                                                    
     amount of  work they perform, the  motor vehicle dealer                                                                    
     shall  post  a  conspicuous  sign that  is  visible  to                                                                    
     service customers that  the dealer's service operations                                                                    
     employees work on commission."                                                                                             
                                                                                                                                
     Renumber the following bill sections accordingly.                                                                          
                                                                                                                                
REPRESENTATIVE GRUENBERG recalled testimony  revealing that it is                                                               
often  a  practice  that  people   in  service  centers  work  on                                                               
commission;  therefore, the  more  repairs sold,  the larger  the                                                               
commission.   He added, "That's happened  to me."  He  noted that                                                               
Amendment 3 would ensure full disclosure.                                                                                       
                                                                                                                                
Number 0655                                                                                                                     
                                                                                                                                
MR. SNIFFEN,  in response to  a request by Chair  Weyhrauch, said                                                               
that he understands the intent  behind [Amendment 2] and does not                                                               
see any harm in it.                                                                                                             
                                                                                                                                
CHAIR WEYHRAUCH said  that [Amendment 2] has some  appeal to him.                                                               
He explained that  his mother just bought tires for  her car and,                                                               
while on a  trip, was told at  a station that she  needed a whole                                                               
new  set, and  she bought  them.   He said  he thinks  people are                                                               
vulnerable to this.                                                                                                             
                                                                                                                                
Number 0698                                                                                                                     
                                                                                                                                
REPRESENTATIVE  CRAWFORD noted  that  the only  place where  this                                                               
type of  thing has  happened to  him was at  Sears, where  he was                                                               
solicited to buy "numerous oil  changes, and that sort of thing."                                                               
He stated  that he is  not so sure  that Sears would  be included                                                               
under "motor vehicle dealer".                                                                                                   
                                                                                                                                
Number 0760                                                                                                                     
                                                                                                                                
CHAIR WEYHRAUCH  said that [the  amendment] does relate  to motor                                                               
vehicles,  and he  said that  he is  "trying to  keep within  the                                                               
scope of this."                                                                                                                 
                                                                                                                                
REPRESENTATIVE  CRAWFORD  said  that   he  doesn't  know  if  the                                                               
committee is directing  the amendment to what  the actual problem                                                               
is.  He  commented that he doesn't have much  experience with new                                                               
car dealers.                                                                                                                    
                                                                                                                                
REPRESENTATIVE GRUENBERG responded that  he offered the amendment                                                               
in response  to what happened  to him.  He  added that he  is not                                                               
saying that the  people were at all dishonest, but  that he "just                                                               
didn't know."                                                                                                                   
                                                                                                                                
Number 0815                                                                                                                     
                                                                                                                                
CHAIR WEYHRAUCH asked if there was any objection to Amendment 2.                                                                
                                                                                                                                
Number 0830                                                                                                                     
                                                                                                                                
MR. SNIFFEN  referred to  AS 45.45.150, which  he said  is titled                                                               
"notice to  customer" and requires an  automobile repair facility                                                               
to notify a  customer that he/she is entitled to  a return of the                                                               
replaced  parts  from the  repair  of  an  automobile.   It  also                                                               
requires  the repair  shop to  post in  a conspicuous  location a                                                               
sign  that informs  the consumer  of its  requirement to  provide                                                               
those parts  when requested.  He  said he was wondering  if "this                                                               
type of language would fit better  in that statute, as opposed to                                                               
this statute."                                                                                                                  
                                                                                                                                
Number 0885                                                                                                                     
                                                                                                                                
REPRESENTATIVE  GRUENBERG  replied that  he  would  ask that  the                                                               
staff work  with Legislative Legal and  Research Services counsel                                                               
to see  "whether it would  go better here  or in 45.45.150."   He                                                               
added that he doesn't care where it goes.                                                                                       
                                                                                                                                
Number 0916                                                                                                                     
                                                                                                                                
CHAIR WEYHRAUCH  said, "We  will make that  note on  Amendment 2,                                                               
and, seeing no objection, Amendment 2 is adopted."                                                                              
                                                                                                                                
Number 0925                                                                                                                     
                                                                                                                                
REPRESENTATIVE  GRUENBERG  offered   an  amendment  labeled  [23-                                                               
LS0975\H.5], which he called Amendment 3, which read as follows:                                                                
                                                                                                                                
     Page 1, line 8, through page 2, line 6:                                                                                    
          Delete all material and insert:                                                                                       
          "(b) A person who does business as a dealer in                                                                        
        the state may not offer to sell or sell a motor                                                                         
        vehicle as a new or current model motor vehicle                                                                         
     [HAVING A MANUFACTURER'S WARRANTY] unless                                                                                  
               (1)  if the vehicle is offered for sale or                                                                   
     sold as  having a  manufacturer's warranty,  the dealer                                                                
     has  a current  sales  and service  agreement with  the                                                                    
     manufacturer  and the  agreement  requires the  dealer,                                                                    
     upon demand of  the motor vehicle buyer,  to perform or                                                                    
     arrange  for,  within  a  reasonable  distance  of  the                                                                    
     dealer's  place of  business in  the state,  the repair                                                                    
     and  replacement  work  required  of  the  manufacturer                                                                    
     under the warranty; [OR]                                                                                                   
     (2)    the vehicle  is  a  current model  used  vehicle                                                                
     received  as a  trade-in in  the normal  course [DEALER                                                                
     OFFERS TO GIVE  THE BUYER A REBATE TO  COVER THE REPAIR                                                                    
     AND REPLACEMENT WORK THAT THE  DEALER CANNOT PERFORM OR                                                                    
     ARRANGE  FOR  WITHIN  A   REASONABLE  DISTANCE  OF  THE                                                                    
     DEALER'S PLACE] of business;"                                                                                          
                                                                                                                                
REPRESENTATIVE  GRUENBERG  asked  Mr. Sniffen  if  he  remembered                                                               
previously discussing page 1, line 8  through page 2, line 1, [in                                                               
Version H], on the record with him.                                                                                             
                                                                                                                                
MR. SNIFFEN answered yes.                                                                                                       
                                                                                                                                
REPRESENTATIVE GRUENBERG  said, "What this  will do is  deal with                                                               
subsection (b)."                                                                                                                
                                                                                                                                
CHAIR  WEYHRAUCH  noted that  he  had  interrupted Mr.  Sniffen's                                                               
preliminary comments  earlier in the  morning.  Because  the bill                                                               
was  drafted as  a result  of  concerns that  Mr. Sniffen  voiced                                                               
originally, he said  he wants to make certain  that the committee                                                               
has  the full  benefit  of hearing  any  additional thoughts  and                                                               
views of Mr. Sniffen's.                                                                                                         
                                                                                                                                
[No action was taken on the proposed Amendment 3 at this time.]                                                                 
                                                                                                                                
Number 1124                                                                                                                     
                                                                                                                                
MR. SNIFFEN  responded that he did  listen to a lot  of testimony                                                               
last night and  would appreciate the opportunity to  follow up on                                                               
some of  the comments  from "our  department's perspective."   He                                                               
noted that  his department is  charged with  protecting consumers                                                               
under  [Alaska's]  consumer protection  Act,  and  he stated  his                                                               
concern with some of representations  that "might be taken out of                                                               
context by the committee here."  He continued as follows:                                                                       
                                                                                                                                
     One  of those  deals with  the idea  that a  registered                                                                    
     importer   has  some   kind   of  consumer   protection                                                                    
     responsibility  because they  are  bonded and  licensed                                                                    
     and other things, and, as  I'd mentioned earlier today,                                                                    
     that  process is  a very  simple  one -  it's not  very                                                                    
     difficult to become a registered importer.                                                                                 
                                                                                                                                
     But, more  importantly, the registered importer  has no                                                                    
     interaction  with  the  consumer.   Consumers  purchase                                                                    
     these vehicles  from dealers.   Dealers get  these cars                                                                    
     from importers or from auctions,  and then the auctions                                                                    
     deal with the importers.                                                                                                   
                                                                                                                                
     We had  a case  here, just last  year, from  a consumer                                                                    
     who purchased  a Canadian vehicle  - it was  1996 Chevy                                                                    
     product -  and it had  an onboard diagnostic  chip that                                                                    
     could  not   be  recalibrated  to  conform   [to]  U.S.                                                                    
     emissions standards.  He took  that vehicle back to the                                                                    
     dealer, and  the dealer essentially wanted  to wash his                                                                    
     hands of the problem and  said, "Well, you know, it was                                                                    
     imported that way."                                                                                                        
                                                                                                                                
     When the consumer tried to  get some documentation from                                                                    
     the dealer who actually tried  to find who the importer                                                                    
     was and  find out  if there  was some  recourse against                                                                    
     the  importer, it  was just  impossible to  do, because                                                                    
     the relationship that the consumer  sees is he's buying                                                                    
     from  the dealer,  he's not  buying  from an  importer.                                                                    
     The consumer  doesn't know who  this importer  is; he's                                                                    
     not  aware  of  this  bond.   I  don't  know  that  any                                                                    
     consumer would know  how to bring an  action against an                                                                    
     importer's bond.  It would take some savvy.                                                                                
                                                                                                                                
     So, the  notion that there is  some consumer protection                                                                    
     here  because  of the  obligations  on  an importer  to                                                                    
     comply with federal standards and  might go to jail for                                                                    
     20  years  if  they  tamper with  odometers  and  those                                                                    
     things, those  protections don't really filter  down to                                                                    
     the  consumer,  and  this  bill,  I  think  would  help                                                                    
     prevent some of those things in its present form.                                                                          
                                                                                                                                
     And another issue  I wanted to bring up  dealt with the                                                                    
     whole  warranty  issue  that several  of  the  Lyberger                                                                    
     employees  testified about,  and,  you  know, if  every                                                                    
     used car  dealer in Alaska  was a Lyberger,  perhaps we                                                                    
     wouldn't  have as  many problems  as  we do.   And  the                                                                    
     testimony  we've   heard  from  used-car   dealers  are                                                                    
     reputable used-car  dealers -  ... the Budgets  and the                                                                    
     Lybergers  and  the Affordables  -  but  there are  347                                                                    
     other used-car dealers  in the state, and  all of these                                                                    
     other used-car  dealers may not be  as forthcoming with                                                                    
     these  types  of  disclosures and  information  as  Mr.                                                                    
     Lyberger's  folks  are.   And  we're  going to  create,                                                                    
     perhaps, an  opportunity for consumer  fraud if  ... we                                                                    
     allow  these kinds  of transactions  to  proceed if  we                                                                    
     don't monitor them very carefully.                                                                                         
                                                                                                                                
     And, I think it was  brought up earlier:  these dealers                                                                    
     aren't  required to  offer  warranties  on these  cars.                                                                    
     Lyberger does and that's great.   I think Mr. Hass (ph)                                                                    
     testified  earlier,  and  he  didn't  suggest  that  he                                                                    
     offered  these kinds  of warranties  on vehicles.   So,                                                                    
     there's no  guarantee that  these warranties  are going                                                                    
     to  go with  these  vehicles, so  discussing when  they                                                                    
     apply,  whether there  are  service contracts,  whether                                                                    
     there are warranties - I  think that's important stuff,                                                                    
     but  for a  majority  of car  dealers  that may  become                                                                    
     irrelevant.    And if  we're  going  to sanction  these                                                                    
     transactions  now  that  are  currently  prohibited,  I                                                                    
     would be  cautious that we're  opening up a  new ground                                                                    
     for perhaps some used-car dealers  who don't sell these                                                                    
     vehicles to now  start selling them.  And  we might run                                                                    
     into some of these problems in the future.                                                                                 
                                                                                                                                
     I  would  just like  the  committee  to consider  those                                                                    
     comments as you go through  some of the original intent                                                                    
     of this bill, and why we  need to do something with the                                                                    
     current  law,  but  at  the  same  time,  provide  some                                                                    
     consumer  protection.   And  I'm  just  leery that  you                                                                    
     might  be  thinking  that,  "Well,  ...  importers  are                                                                    
     protecting  consumers,"  because  I have  some  serious                                                                    
     reservations   whether  they   are.      I  also   have                                                                    
     reservations   about  whether   free  warranties   with                                                                    
     vehicles  from  used  car dealers  are  going  to  help                                                                    
     protect consumers, as well.                                                                                                
                                                                                                                                
Number 1429                                                                                                                     
                                                                                                                                
REPRESENTATIVE SEATON referred to [paragraph] (2) on page 2,                                                                    
[beginning on] line 2, which read as follows:                                                                                   
                                                                                                                                
               (2) the vehicle is a current model used                                                                      
     vehicle  received as  a trade-in  in the  normal course                                                                
     [DEALER OFFERS TO GIVE THE  BUYER A REBATE TO COVER THE                                                                    
     REPAIR  AND REPLACEMENT  WORK  THAT  THE DEALER  CANNOT                                                                    
     PERFORM OR ARRANGE FOR WITHIN  A REASONABLE DISTANCE OF                                                                    
     THE DEALER'S PLACE] of business;                                                                                       
                                                                                                                                
REPRESENTATIVE SEATON asked, "Isn't  that essentially ... what is                                                               
being satisfied  with either the  Heritage warranty,  or offering                                                               
to do that in-house with his  own ... repair facilities or with a                                                               
short distance?"                                                                                                                
                                                                                                                                
MR. SNIFFEN replied as follows:                                                                                                 
                                                                                                                                
     I think it  does to some extent, but I  don't know that                                                                    
     that was the original intent  of this section.  The way                                                                    
     statute  currently reads  is you  can't sell  a new  or                                                                    
     current-model  car  having a  manufacturer's  warranty.                                                                    
     The   Heritage  warranty   is   not  a   manufacturer's                                                                    
     warranty, it's really  an after-market service contract                                                                    
     or warranty, if you will  - technically it is a service                                                                    
     contract.                                                                                                                  
                                                                                                                                
     But I  think the current  statute has this  language in                                                                    
     here to prevent,  perhaps, folks in the  Bush who don't                                                                    
     have access  to repair  facilities, from selling  a new                                                                    
     vehicle to  a consumer with a  manufacturer's warranty,                                                                    
     but then not  have the ability to  actually perform the                                                                    
     warranty service.                                                                                                          
                                                                                                                                
     So, under those  circumstances, if you had  to fly from                                                                    
     Bethel  to Fairbanks,  or from  some remote  area to  a                                                                    
     repair facility  to get the  work done, then  you could                                                                    
     only sell the  warranty if you agreed  to reimburse the                                                                    
     consumer for those expenses.   And I think that was the                                                                    
     situation that this language addressed.                                                                                    
                                                                                                                                
     I don't  know that  it necessarily  was meant  to allow                                                                    
     used  car   dealers  to  sell   current-model  Canadian                                                                    
     vehicles  so long  as they  had  a replacement  service                                                                    
     contract of  some kind to  go along with  them, because                                                                    
     those aren't manufacturer's warranties.                                                                                    
                                                                                                                                
MR. SNIFFEN, in response to a question by Representative                                                                        
Gruenberg, confirmed that he had not yet received [Amendment 3].                                                                
                                                                                                                                
REPRESENTATIVE GRUENBERG offered Amendment 4 [originally labeled                                                                
Amendment 3], which read as follows [original punctuation                                                                       
provided]:                                                                                                                      
                                                                                                                                
     Page 5, following line 22:                                                                                                 
          Insert a new bill section to read:                                                                                    
     "*Sec.5.  AS  45.25.465  is amended  by  adding  a  new                                                                  
     subsection to read:                                                                                                        
               (c) When a motor vehicle dealer sells a used                                                                     
     motor vehicle, the motor  vehicle dealer shall disclose                                                                    
     to the buyer  in writing in a manner that  is clear and                                                                    
     conspicuous                                                                                                                
                    (1) that the warranty provisions of AS                                                                      
     45.45.300-45.45.360  do not  apply to  the purchase  of                                                                    
     the motor vehicle; and                                                                                                     
                    (2) that, if applicable, the vehicle is                                                                     
     not subject to a manufacturer's warranty."                                                                                 
                                                                                                                                
     Renumber the following bill sections accordingly                                                                           
                                                                                                                                
REPRESENTATIVE GRUENBERG said that  that would include a current-                                                               
model motor vehicle also.                                                                                                       
                                                                                                                                
Number 1729                                                                                                                     
                                                                                                                                
REPRESENTATIVE LYNN objected for the purpose of discussion.                                                                     
                                                                                                                                
Number 1750                                                                                                                     
                                                                                                                                
MR.  SNIFFEN,  in  response  to   a  question  by  Representative                                                               
Gruenberg,  said  that he  doesn't  believe  that the  words  "or                                                               
current-model motor vehicle"  have to be added.   He stated, "I'm                                                               
not sure that  [paragraph] (2) would have any relevance  to a lot                                                               
of  motor  vehicles  covered  by this  language.    The  vehicles                                                               
(indisc.)  to a  manufacturer's  warranty is  almost assumed  and                                                               
obvious in  so many  used vehicle transactions  that making  it a                                                               
requirement  might  ... just  add  another  unnecessary layer  of                                                               
paperwork to an  otherwise ... normal used-car  transaction."  He                                                               
proffered that  it really  makes the most  sense to  require that                                                               
disclosure when you're  selling a vehicle "that  a consumer might                                                               
confuse the new vehicle, which  would be these current-model year                                                               
vehicles."                                                                                                                      
                                                                                                                                
Number 1790                                                                                                                     
                                                                                                                                
REPRESENTATIVE  GRUENBERG suggested  the  following amendment  to                                                               
Amendment 4 as follows:                                                                                                         
                                                                                                                                
     After "used motor vehicle"                                                                                                 
     Before ","                                                                                                                 
     Add:  "or a current-model motor vehicle"                                                                                   
                                                                                                                                
MR. SNIFFEN confirmed that that would be the right term to use.                                                                 
                                                                                                                                
Number 1830                                                                                                                     
                                                                                                                                
REPRESENTATIVE  SEATON stated  his  understanding that  "current-                                                               
model motor vehicle" would include a new vehicle.                                                                               
                                                                                                                                
REPRESENTATIVE  GRUENBERG responded  no.   He explained,  "New is                                                               
different."                                                                                                                     
                                                                                                                                
REPRESENTATIVE SEATON said,  "No, a current model  can be neither                                                               
[either] new or used, but it's a current model."                                                                                
                                                                                                                                
Number 1855                                                                                                                     
                                                                                                                                
MR. SNIFFEN responded as follows:                                                                                               
                                                                                                                                
     That was exactly my first  reaction, is that if we just                                                                    
     said "current-model motor  vehicle", that would include                                                                    
     the universe  of all new  cars.   And it would  have to                                                                    
     read  something to  the effect  of "current-model  used                                                                    
     motor vehicle".                                                                                                            
                                                                                                                                
REPRESENTATIVE   GRUENBERG  acquiesced   to  the   suggestion  of                                                               
inserting the  words "current-model used motor  vehicle" instead.                                                               
He  asked  Mr. Sniffen  if  he  could  support Amendment  4,  [as                                                               
amended].                                                                                                                       
                                                                                                                                
MR. SNIFFEN  said yes.   He added,  "The more information  we can                                                               
give a consumer about these transactions, ... the better."                                                                      
                                                                                                                                
Number 1920                                                                                                                     
                                                                                                                                
REPRESENTATIVE GRUENBERG said that his  staff had added the words                                                               
"clear and conspicuous" to Amendment  4 after a discussion he had                                                               
had with  Representative Lynn.   He asked Representative  Lynn if                                                               
that addition was satisfactory.                                                                                                 
                                                                                                                                
Number 1933                                                                                                                     
                                                                                                                                
REPRESENTATIVE  LYNN suggested  a "bumper-sticker-sized  sign" on                                                               
the  window that  says, "Canadian  vehicle,  current, no  factory                                                               
warranty."  He added that it  would also say in small print, "see                                                               
disclosure forms for further information."                                                                                      
                                                                                                                                
Number 1988                                                                                                                     
                                                                                                                                
REPRESENTATIVE  GRUENBERG said  that he  would accept  that as  a                                                               
"conceptual friendly  amendment" [to Amendment 4].   He suggested                                                               
that it could read:                                                                                                             
                                                                                                                                
     After "clear and conspicuous"                                                                                              
     Insert "and posted in the window of the car"                                                                               
                                                                                                                                
REPRESENTATIVE  LYNN repeated  his  idea for  the information  to                                                               
read "Canadian vehicle" and "no  factory warranty".  He rephrased                                                               
his previously stated suggestion  to recommend that [the sticker]                                                               
also read in small print, "See detailed disclosure."                                                                            
                                                                                                                                
REPRESENTATIVE  GRUENBERG  said  he  thinks  that  the  amendment                                                               
should also include "that it's not subject to the lemon law."                                                                   
                                                                                                                                
REPRESENTATIVE   GRUENBERG   suggested   another   amendment   to                                                               
Amendment  4  would  be  to  delete  the  word  "and"  [preceding                                                               
paragraph  (2)], and  [after the  corrected  word "warranty",  to                                                               
delete "."  and] insert ";" and  "(3) and stating the  country of                                                               
manufacture if not the United States."                                                                                          
                                                                                                                                
REPRESENTATIVE   GRUENBERG,  in   response  to   a  question   by                                                               
Representative Lynn, said  that he would like the  language to be                                                               
broad enough [to encompass other countries].                                                                                    
                                                                                                                                
Number 2080                                                                                                                     
                                                                                                                                
MR. SNIFFEN, in response to  a question by Chair Weyhrauch, noted                                                               
that there  is already a statute  - AS 45.25.470 -  that requires                                                               
the disclosure  in writing  to a consumer  whether a  vehicle was                                                               
originally  manufactured for  sale in  Canada or  another foreign                                                               
country; therefore  he said  he doesn't  know that  that language                                                               
needs to be included in here.                                                                                                   
                                                                                                                                
Number 2100                                                                                                                     
                                                                                                                                
REPRESENTATIVE LYNN reiterated  his idea to require  a sticker on                                                               
the car.   He noted that a lot of  vehicles manufactured overseas                                                               
arrive into the  U.S. in a legitimate manner.   He clarified that                                                               
he wants  to separate  those cars  that come  in from  the "grey-                                                               
market" from those  that come in through a new-car  dealer in the                                                               
normal course of business.   He suggested an alternative would be                                                               
to "withdraw  the friendly  amendment and  just vote  against the                                                               
whole thing."                                                                                                                   
                                                                                                                                
REPRESENTATIVE GRUENBERG read AS 45.25.470 as follows:                                                                          
                                                                                                                                
     Sales of  vehicles manufactured for  sale in  a foreign                                                                    
     country.   Before  sale, a  motor vehicle  dealer shall                                                                    
     disclose  in  writing  whether   a  motor  vehicle  was                                                                    
     originally manufactured  for sale in Canada  or another                                                                    
     foreign country.                                                                                                           
                                                                                                                                
REPRESENTATIVE GRUENBERG  said, "So,  my suggestion  would simply                                                               
be to  have as a  category, 'subject  to AS 45.25.470,'  and that                                                               
would do  exactly what you want."   He asked Mr.  Sniffen if that                                                               
was true.                                                                                                                       
                                                                                                                                
MR. SNIFFEN said he believed so.                                                                                                
                                                                                                                                
Number 2198                                                                                                                     
                                                                                                                                
REPRESENTATIVE LYNN withdrew his friendly amendment.                                                                            
                                                                                                                                
Number 2225                                                                                                                     
                                                                                                                                
REPRESENTATIVE  GRUENBERG clarified  that [a  new paragraph  (3)]                                                               
would read as follows:                                                                                                          
                                                                                                                                
     (3) that, if applicable, the vehicle is subject to AS                                                                      
     45.25.470                                                                                                                  
                                                                                                                                
REPRESENTATIVE  GRUENBERG said  he  would  make that  conceptual,                                                               
because "we don't  want to just cite the statute."   He said that                                                               
it would have  to say clearly that it's made  in another country,                                                               
subject to sale in the United States.                                                                                           
                                                                                                                                
Number 2770                                                                                                                     
                                                                                                                                
CHAIR  WEYHRAUCH  asked  if  there   was  any  objection  to  the                                                               
amendment to Amendment 4 that  would add "or a current-model used                                                               
motor vehicle".                                                                                                                 
                                                                                                                                
Number 2299                                                                                                                     
                                                                                                                                
REPRESENTATIVE CRAWFORD said, "It's  getting awfully confusing to                                                               
me, and I don't know if it's really needed, but ..."                                                                            
                                                                                                                                
Number 2315                                                                                                                     
                                                                                                                                
REPRESENTATIVE LYNN stated that  he would vote against [Amendment                                                               
4] no matter what is added to it.                                                                                               
                                                                                                                                
CHAIR WEYHRAUCH continued:                                                                                                      
                                                                                                                                
     And  then ...  adding,  "(3) that,  if applicable,  the                                                                    
     vehicle  is  subject to  AS  45.25.470."   Okay,  as  a                                                                    
     friendly amendment we'll just add those.                                                                                   
                                                                                                                                
CHAIR  WEYHRAUCH, in  response to  a  question by  Representative                                                               
Gruenberg, said  that he  thinks the committee  has the  idea [of                                                               
what  the  amendments  are  about].     He  asked  Representative                                                               
Gruenberg  if  there was  anything  else  [to discuss]  regarding                                                               
Amendment 4.                                                                                                                    
                                                                                                                                
REPRESENTATIVE GRUENBERG answered no.                                                                                           
                                                                                                                                
CHAIR WEYHRAUCH said, "Okay, there's  a motion on Amendment 4 [as                                                               
amended  and] an  objection.   Is there  any further  discussion?                                                               
Secretary call the roll."                                                                                                       
                                                                                                                                
[The friendly amendments to Amendment  4 were treated as adopted;                                                               
therefore, Amendment 4 would read as follows:]                                                                                  
                                                                                                                                
     Page 5, following line 22:                                                                                                 
          Insert a new bill section to read:                                                                                    
     "*Sec.5.  AS  45.25.465  is amended  by  adding  a  new                                                                  
     subsection to read:                                                                                                        
               (c) When a motor vehicle dealer sells a used                                                                     
     motor vehicle  or a  current-model used  motor vehicle,                                                                    
     the motor  vehicle dealer shall  disclose to  the buyer                                                                    
     in writing in a manner that is clear and conspicuous                                                                       
                    (1) that the warranty provisions of AS                                                                      
     45.45.300-45.45.360  do not  apply to  the purchase  of                                                                    
     the motor vehicle;                                                                                                         
                    (2) that, if applicable, the vehicle is                                                                     
     not subject to a manufacturer's warranty; and                                                                              
                    (3) that, if applicable, the vehicle is                                                                     
     subject to AS 45.25.470."                                                                                                  
                                                                                                                                
     Renumber the following bill sections accordingly                                                                           
                                                                                                                                
A roll  call vote  was taken.   Representatives  Gruenberg, Holm,                                                               
Seaton, Crawford,  and Weyhrauch voted  in favor of  Amendment 4,                                                               
as amended.   Representative Lynn  voted against it.   Therefore,                                                               
Amendment 4, as amended, was adopted by a vote of 5-1.                                                                          
                                                                                                                                
Number 2400                                                                                                                     
                                                                                                                                
REPRESENTATIVE  GRUENBERG  offered  Amendment  5  [text  provided                                                               
previously].                                                                                                                    
                                                                                                                                
REPRESENTATIVE LYNN objected for the purposes of discussion.                                                                    
                                                                                                                                
Number 2420                                                                                                                     
                                                                                                                                
MR.  SNIFFEN,  in  response  to   a  question  by  Representative                                                               
Gruenberg, said, "We have no opposition to that amendment."                                                                     
                                                                                                                                
REPRESENTATIVE LYNN withdrew his objection to Amendment 5.                                                                      
                                                                                                                                
Number 2436                                                                                                                     
                                                                                                                                
CHAIR  WEYHRAUCH asked  if there  was further  objection.   There                                                               
being none, Amendment 5 was adopted.                                                                                            
                                                                                                                                
Number 2485                                                                                                                     
                                                                                                                                
REPRESENTATIVE GRUENBERG  referred to Amendment 3.   He addressed                                                               
Mr. Sniffen as follows:                                                                                                         
                                                                                                                                
     It  was  my  thought  that  the  law  currently  allows                                                                    
     somebody who  is selling a current-model  motor vehicle                                                                    
     to provide a rebate to cover  the cost of repair, or to                                                                    
     have  a  current  sales  and   service  agreement.    I                                                                    
     actually wanted to just retain the current law.                                                                            
                                                                                                                                
REPRESENTATIVE   GRUENBERG  referred   to   [paragraph  (2)]   of                                                               
Amendment 3, which read as follows:                                                                                             
                                                                                                                                
     (2)    the vehicle  is  a  current model  used  vehicle                                                                
     received  as a  trade-in in  the normal  course [DEALER                                                                
     OFFERS TO GIVE  THE BUYER A REBATE TO  COVER THE REPAIR                                                                    
     AND REPLACEMENT WORK THAT THE  DEALER CANNOT PERFORM OR                                                                    
     ARRANGE  FOR  WITHIN  A   REASONABLE  DISTANCE  OF  THE                                                                    
     DEALER'S PLACE] of business;"                                                                                          
                                                                                                                                
REPRESENTATIVE  GRUENBERG  said,  "We  had  continued  to  delete                                                               
that," but he  said that he thinks that  language should probably                                                               
be left in.  He asked Mr. Sniffen if he agreed.                                                                                 
                                                                                                                                
Number 2571                                                                                                                     
                                                                                                                                
MR. SNIFFEN said it looks as  though that language is repeated in                                                               
[paragraph]  (1) of  [Amendment 3];  therefore he  said he's  not                                                               
sure "what the purpose of keeping that language in would be."                                                                   
                                                                                                                                
Number 2582                                                                                                                     
                                                                                                                                
REPRESENTATIVE GRUENBERG  said that that  is what he  had thought                                                               
initially; however,  he noted  that the  rebate is  not mentioned                                                               
[in paragraph (1)], and he thinks that's important to include.                                                                  
                                                                                                                                
CHAIR WEYHRAUCH, in response to  a request for clarification from                                                               
Representative Crawford,  said that  the committee  is discussing                                                               
Amendment  3 "that  was earlier  discussed  and then  withdrawn,"                                                               
which is labeled, 23-LS0975\H.5, [Bannister, 5/16/03].                                                                          
                                                                                                                                
REPRESENTATIVE GRUENBERG  reiterated that [paragraph (2)]  is not                                                               
exactly the same as [paragraph  (1)], because of the reference to                                                               
the dealer's ability to give the buyer a rebate.                                                                                
                                                                                                                                
Number 2666                                                                                                                     
                                                                                                                                
REPRESENTATIVE  SEATON pointed  out  another difference  [between                                                               
the two paragraphs]  is that paragraph (1) talks about  a new car                                                               
having a  manufacturer's warranty, while paragraph  (2) addresses                                                               
used  vehicles.   He stated  that he  agrees with  Representative                                                               
Gruenberg  that  the  deleted  language should  be  left  in  for                                                               
consumer protection.                                                                                                            
                                                                                                                                
Number 2695                                                                                                                     
                                                                                                                                
MR. SNIFFEN responded as follows:                                                                                               
                                                                                                                                
     I don't know that I have  a problem with the concept or                                                                    
     the  intent  here,  but  when  we're  trying  to  amend                                                                    
     current  Version H  to  include  these warranty  issues                                                                    
     things get a  little complicated for me as  well, and I                                                                    
     have  to share  Representative  Crawford's confusion  a                                                                    
     little bit.                                                                                                                
                                                                                                                                
     I  think the  intent of  the initial  amendment was  to                                                                    
     clean  up [AS]  08.66.015, so  it was  very simple  and                                                                    
     easy to understand.  If  you're selling a new car, this                                                                    
     is what you  have to do.  If you're  selling a current-                                                                    
     model car that's  not new, this is what you  have to do                                                                    
     to sell that.   And we took out  these warranty issues,                                                                    
     because  they  simply  weren't a  problem  up  here  in                                                                    
     Alaska.   And I think  working with that  language over                                                                    
     ...  at  least  the  four years  I've  been  here,  and                                                                    
     speaking  with  the  new  car   dealers,  I  think  the                                                                    
     manufacturers'  service  agreements  with  the  dealers                                                                    
     have sort  of removed  some of  the concerns  that that                                                                    
     warranty language was intended to protect against.                                                                         
                                                                                                                                
     If we want  to address these warranty  issues - selling                                                                    
     cars, whether  or used  with a  warranty, and  what you                                                                    
     have to  do -  it might  be better to  put that  into a                                                                    
     separate  provision  in and  of  itself,  so we're  not                                                                    
     combining these concepts.  And  I think that might keep                                                                    
     it cleaner and easier to understand.                                                                                       
                                                                                                                                
Number 2755                                                                                                                     
                                                                                                                                
REPRESENTATIVE GRUENBERG  suggested he could offer  [Amendment 3]                                                               
as a conceptual amendment and ask  the drafter to work with staff                                                               
and Mr.  Sniffen to set the  language out in a  separate section,                                                               
if necessary.                                                                                                                   
                                                                                                                                
MR.  SNIFFEN responded  that he  thinks  that would  be a  better                                                               
approach, and he  stated that he would be happy  to work with the                                                               
drafters  on either  coming  up  with a  separate  section or  "a                                                               
separate  provision  within  this section"  that  just  addresses                                                               
these warranty concerns.                                                                                                        
                                                                                                                                
Number 2833                                                                                                                     
                                                                                                                                
REPRESENTATIVE CRAWFORD asked if there  is a problem with the way                                                               
our Version  H is  written.   He said, "I  thought we  had worked                                                               
this language out that was pretty much acceptable."                                                                             
                                                                                                                                
CHAIR WEYHRAUCH  said, "And  I object  too, for  that reason.   I                                                               
think I  want to keep  that as simple  as possible on  this one."                                                               
He asked if there were any further comments from the committee.                                                                 
                                                                                                                                
Number 2860                                                                                                                     
                                                                                                                                
MR.  SNIFFEN,  in  response  to   a  question  by  Representative                                                               
Gruenberg,  said  that  Amendment  3 raises  some  confusion  for                                                               
various reasons  that he said  he did  not know if  the committee                                                               
had time to get into.  He  concluded, "I don't know that it helps                                                               
our cause any."                                                                                                                 
                                                                                                                                
Number 2875                                                                                                                     
                                                                                                                                
REPRESENTATIVE GRUENBERG withdrew [his  motion to adopt Amendment                                                               
3].                                                                                                                             
                                                                                                                                
Number 2885                                                                                                                     
                                                                                                                                
REPRESENTATIVE  GRUENBERG moved  to adopt  Amendment 6,  [labeled                                                               
23-LS0975\H.1, Bannister, 5/15/03].                                                                                             
                                                                                                                                
Number 2889                                                                                                                     
                                                                                                                                
REPRESENTATIVE LYNN objected for the purpose of discussion.                                                                     
                                                                                                                                
Number 2900                                                                                                                     
                                                                                                                                
REPRESENTATIVE GRUENBERG  reviewed the highlights of  Amendment 6                                                               
[text provided previously].                                                                                                     
                                                                                                                                
TAPE 03-69, SIDE B                                                                                                            
Number 2999                                                                                                                     
                                                                                                                                
MR.  SNIFFEN mentioned  the "sale  approach."   He added,  "And I                                                               
think  I've testified  previously on  our concerns  with it,  but                                                               
leave  it to  the  committee to  decide how  they  would like  to                                                               
approach it."  Mr. Sniffen continued as follows:                                                                                
                                                                                                                                
     [Amendment 6]  certainly would be something  that would                                                                    
     help the  consumer.  I don't  know that it would  be as                                                                    
     effective  as  the   language  currently  contained  in                                                                    
     Version H,  simply because we're  dealing with  so many                                                                    
     used-car  dealers  and  their  ability  to  make  these                                                                    
     disclosures in  an informed way  is something  that our                                                                    
     office doesn't  have a  lot of faith  in, to  be frank.                                                                    
     And I remember testimony by  one of the members of this                                                                    
     committee that  when they  visited Lyberger's  lot this                                                                    
     year, they  weren't even told that  these vehicles were                                                                    
     manufacturers'  (indisc.).   So,  having  this law  and                                                                    
     making  sure that  all of  the 350  some-odd used-  car                                                                    
     dealers in  Alaska who sell these  vehicles comply with                                                                    
     it is a different story,  and since we are dealing with                                                                    
     a fairly  large purchase  - if  not the  single largest                                                                    
     purchase a consumer might make  in their lifetime, then                                                                    
     perhaps the  second largest, followed closely  by their                                                                    
     home - it's risky.  ...  But it does accomplish some of                                                                    
     the goals that we're trying to achieve.                                                                                    
                                                                                                                                
Number 2930                                                                                                                     
                                                                                                                                
REPRESENTATIVE CRAWFORD said he  thinks he's addressed this issue                                                               
several times.   He  noted that  there are  "homegrown franchised                                                               
dealers" [in Alaska],  and [the legislature] has seen  fit in the                                                               
law to  say that there can't  be other new-car dealers  within 14                                                               
miles of [another same dealership].  He continued as follows:                                                                   
                                                                                                                                
     These cars  that are coming  in - they are  used, under                                                                    
     the law, but  pretty much as a technicality,  as far as                                                                    
     I see.   And they're new to the consumer.   They may be                                                                    
     used to the  law, but they're new to  the consumer, and                                                                    
     I  believe  that  undercuts  and  puts  our  franchised                                                                    
     dealers  in a  non-competitive situation,  and I  can't                                                                    
     vote for it.                                                                                                               
                                                                                                                                
Number 2900                                                                                                                     
                                                                                                                                
REPRESENTATIVE LYNN said, "Ditto."                                                                                              
                                                                                                                                
Number 2910                                                                                                                     
                                                                                                                                
REPRESENTATIVE  HOLM  apologized  for   his  absence  during  the                                                               
earlier portion  of the  meeting.  He  referred to  [Amendment 6]                                                               
and asked for a definition of "normal course of business".                                                                      
                                                                                                                                
Number 2869                                                                                                                     
                                                                                                                                
MR.  SNIFFEN said  that  he  doesn't believe  that  that term  is                                                               
defined  anywhere in  statute.    He said  that  it's an  assumed                                                               
definition,  such as  "reasonable person,"  which he  said really                                                               
isn't defined anywhere, other than in some jury instructions.                                                                   
                                                                                                                                
Number 2853                                                                                                                     
                                                                                                                                
REPRESENTATIVE  GRUENBERG   said  there  has   been  considerable                                                               
testimony  that there  are various  ways that  "people do  obtain                                                               
these vehicles."  Some of those  ways, he noted, are purchasing a                                                               
used vehicle as a trade-in, directly  from a consumer, or "from a                                                               
rebel  fleet  or  a  repossession."     However,  he  stated  his                                                               
understanding  that the  primary  way that  dealers obtain  these                                                               
vehicles  is at  dealer auctions.   He  asked Mr.  Sniffen if  he                                                               
agreed with that assessment.                                                                                                    
                                                                                                                                
MR. SNIFFEN said  that that is the testimony that  he's heard, as                                                               
well.                                                                                                                           
                                                                                                                                
Number 2811                                                                                                                     
                                                                                                                                
A roll  call vote was  taken.  Representatives Holm,  Seaton, and                                                               
Gruenberg  voted  in  favor  of  Amendment  6.    Representatives                                                               
Dahlstrom,  Lynn,  Crawford,  and  Weyhrauch  voted  against  it.                                                               
Therefore, Amendment 6 failed by a vote of 3-4.                                                                                 
                                                                                                                                
Number 2759                                                                                                                     
                                                                                                                                
REPRESENTATIVE DAHLSTROM  moved to report CSHB  272(STA), Version                                                               
23-LS0975\H, [Bannister,  5/14/03], as amended, out  of committee                                                               
with individual recommendations and  the accompanying zero fiscal                                                               
note.  There  being no objection, CSHB 272(STA)  was reported out                                                               
of the House State Affairs Standing Committee.                                                                                  
                                                                                                                                

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