Maryland: EV tax credits, dealer performance standards, paid sick leave
WANADA advisor on Maryland matters Mike Johansen of Rifkin Weiner Livingston LLC, provided an overview of new and old Maryland laws and regulations. Among them were the electric vehicle (EV) tax credit, tax on leased vehicles, dealer performance standards, new vehicle damage disclosure, spot delivery and paid sick leave.
– EV tax credit reinstated
The Maryland EV tax credit will be
reinstated starting July 1. This year the funds were used up by March and no money has been available since then. The credit is $100 per kilowatt hour, up to $3,000, for all vehicles costing less than $60,000. There is more money in the budget for next year to ensure that the funds will not run out again.
– Protections on Dealer Performance Standards
The new legislation that will become law clarifies the existing law on dealer performance standards in franchise agreements. Things like sales objectives and dealer programs must be fair; reasonable and equitable; and be based on accurate information, to include demographic characteristics and consumer preferences in the dealerês assigned market area. The automaker has the burden of proving that measures are fair and reasonable.
– New laws on leased vehicles
Starting October 1, two new laws kick in for leased vehicles:
« There is no vehicle excise tax on vehicles leased to state agencies or Maryland local governments.
« No used vehicle safety inspection has to be performed where the lessee keeps the vehicle at the end of the lease term.
– Regulations made less burdensome: damage disclosure, salesmanês license
MD Gov. Larry Hogan is pro-business and eager to remove red tape, said Mike Johansen. The Motor Vehicle Administration is working to that end with MADA and WANADA through the administratorês Dealer Advisory Panel. Some results, effective March 13, 2017:
« A dealer must disclose new vehicle damage to a consumer only if it is more than 3 percent of MSRP. The salesperson should disclose the damage before negotiating the price. The dealer associations have been trying to get that law passed for 20 years, Johansen said.
« Salesman license applications and renewals must be accompanied by a copy of the state criminal history record check. The MVA will review the application for disqualifying crimes. The salesmanês license has been extended from one to three years.
« Dealer licenses have been extended from two years to three.
« Sixty-day temporary permits for transfer tags must now be processed electronically. That process replaces form CS-124.
– Spot delivery in MD
When the spot delivery law was passed in 2015, consumer groups had wanted to
make spot delivery illegal, Johansen said. The resulting law may be imperfect, but is
clearly better for dealers than an outright ban.
Under the law, if dealer-arranged financing is not final, the dealer must notify the buyer of the rights and duties of the buyer and dealer, in language specified by the law. If financing does not get approved, the dealer must notify the buyer in writing within four days of vehicle delivery. The customer must then bring the car back in two days or enter into new financing. If no new deal is agreed on, the dealer must return the customerês down payment and trade-in.
– 2016 TSBs, recalls, warranty-recall repairs
Dealers may provide recall notices and Technical Service Bulletins (TSBs) to their sales and service customers if the information in the bulletins relates to any condition that may substantially affect motor vehicle safety, durability, reliability or performance.
If a stop sale is issued on recall vehicles and the parts are not available, auto makers must pay the dealer either 1 percent, per month of the value of the vehicle(s) or the funds promised in its national program. In addition, the automaker must pay for covered warranty or recall repairs even if the dealer discovers the need for the repair (1) while doing other work the customer requests; or (2) through notice of an outstanding recall under federal law for a safety-related defect.
– Paid sick leave in MD and Mont. Co.
Gov. Hogan vetoed the paid sick leave bill, but Mike Johansen expects the General Assembly to override the veto, either in a special session this fall or at the start of the new legislative session in January. In either case, the law would not take effect until January.
Donêt wait to see if the veto is overridden, said Johansen. I am 90 percent certain there will be a sick leave law in Maryland. Dealers should start to plan how they will comply with it.
The law requires all employers with 15 or more employers to offer paid sick leave; smaller employers must offer unpaid leave. It applies to all employees 18 or older who regularly work at least 12 hours a week. Employers must allow leave for care or treatment of illness, maternity/paternity leave and certain other absences. Employees earn one hour of leave for every 30 hours worked, up to 40 hours per year. They may carry over hours to the next year.
Recordkeeping is the piece thatês going to kill you, Johansen said. Dealers may avoid extensive recordkeeping if they grant a full 40 hours of leave to full-time employees at the beginning of each year. Dealers may also wrap sick leave into scheduled vacation time and simply offer paid time off.
The Montgomery County paid sick leave rules already in effect will not be affected by the new state law.Download Bulletin PDF