Legislature(2009 - 2010)BELTZ 105 (TSBldg)
03/11/2010 01:30 PM Senate LABOR & COMMERCE
| Audio | Topic |
|---|---|
| Start | |
| SB262 | |
| SB263 | |
| SB272 | |
| SB97 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| *+ | SB 262 | TELECONFERENCED | |
| *+ | SB 263 | TELECONFERENCED | |
| + | SB 272 | TELECONFERENCED | |
| + | TELECONFERENCED | ||
| = | SB 97 | ||
SB 272-RENTAL CAR CHARGES
CHAIR PASKVAN announced SB 272 to be up for consideration.
1:54:41 PM
SENATOR HUGGINS, sponsor of SB 272, explained that this is a
consumer protection bill that will help people who rent cars
know what their charges will be. He said they had all traveled
places and got a quote for a $50-dollar vehicle and by the time
it was all done, it was a $75-dollar vehicle because of all the
things they didn't know about. He said SB 272 creates full
disclosure and if you violate that, it's an unfair trade
practice.
1:57:13 PM
EDRA MORELEDGE, staff to Senator Huggins, said SB 272 will allow
rental car companies to do in Alaska what they already do in 30
other states. Alaska law is currently silent on the issue of
separately listed charges on rental car statements for the
recovery of fees. This bill would require that those fees be
listed separately and be clearly identified on the agreement.
In addition to government taxes and surcharges, rental car
companies also assess additional cost recovery fees, she
explained, and consumers should be made aware of those and be
able to see the fees they are being charged on both the bill and
the online quote. SB 272 provides for full disclosure and
transparency of cost recovery fees that are included in rental
car agreements. In addition, it would make violating the
provisions of this bill an unfair trade practice.
SENATOR BUNDE said she used two different terms and he wanted to
make sure that when she said allow the credit card companies to
do this, she actually meant requires them to list those separate
fees.
MS. MORELEDGE responded that Alaska doesn't have any laws
currently on this issue, so she used the word allow to mean they
were putting a law on the books.
SENATOR HUGGINS added that SB 272 requires disclosure before and
after. Some car companies have an energy fee or tire fee, but
this doesn't allow that. It protects our Alaskan neighbors and
doesn't allow big international organizations to gouge them.
CHAIR PASKVAN asked if the intent of the bill is that the
ultimate charge has to be their advertised charge, and if there
are governmental mandated fees or airport facility fees in
addition to that, at least the core rental has to be disclosed.
SENATOR HUGGINS replied yes, and those fees have to be itemized;
otherwise it's an unfair trade practice violation.
SENATOR THOMAS asked if anything in the bill requires the print
to be any larger in the rental agreements.
SENATOR HUGGINS quipped back that they are working on a
magnifying glass provision for the older guys.
2:00:58 PM
DON FONTE, Director, Government Relations, Hertz Corporation,
said Hertz supports the concept of this legislation as it
relates to full disclosure to the consumer of any taxes and
other charges in a vehicle rental agreement. But Hertz's concern
is with the provision that limits the permissible charges that
may be included in a rental agreement, he said, and he
respectfully urged them to consider amending the bill to allow
additional separately itemized charges in the rental agreement
aside from those listed in the bill provided so that all such
charges are fully disclosed to the consumer at the time of
reservation and rental.
He said disclosure of those charges is common practice within
the car rental industry. He added that all of Hertz's
distribution channels, whether it's on their company website,
through their 800-number, or even third-party booking sites like
Travelocity. The consumer is provided a total estimated price
and has available all the component parts of that price.
MR. FONTE said that he had forwarded an amendment to the
committee that would make those changes and make SB 272
consistent with similar statutes that were adopted in a number
of states over the last couple of years. The relevant language
in those statutes was agreed to by all of the major car rental
companies within the industry. Currently two states have bills
pending with their proposed amendment. He said it would simply
bring Alaska into alignment with those states. He said that
Hertz completely agrees with Senator Huggins' concept of fully
disclosing to the consumer what their charges are including the
base rate and the total estimated price.
2:03:58 PM
SENATOR BUNDE asked why not roll all the costs into the bottom
line instead of separating them.
MR. FONTE responded that it comes down to the fact that many of
the fees are governmentally imposed, and they felt that
itemizing the charges is appropriate. It also makes transparent
to the consumer what the component parts of the total are.
SENATOR HUGGINS said he had made an interesting point, but the
amendment Mr. Fonte was representing would essentially "gut this
bill," because it would be open-ended and they could list any
charges they wanted to. He agreed with Senator Bunde - if Hertz
wants to include some things outside of this bill, just add it
to the overall price of the car. "This is about Alaska...There
are 30 states that are doing what we're describing here, and he
talked about two states."
CHAIR PASKVAN asked if he felt that SB 272 as currently written
is the best protection for Alaska consumers.
SENATOR HUGGINS replied, "It's as good as it gets consumer
protection wise in rental cars in Alaska."
2:07:15 PM
ED SNIFFEN, Consumer Protection Unit, Department of Law (DOL),
agreed with Senator Huggins. He said SB 272 provides good
consumer protection and the department supports it. He stated
that some terms of art were being used by the Hertz
representative. There is a base price and a total price. What
you see when you go online and rent your car is the base price -
$19.95, for instance. Then three pages deep into the process you
might see cleaning and inspection fees and fuel surcharges added
that bring that price up to $69.95. It's that kind of conduct
that this bill would prohibit. This bill isolates only those
charges that are actually paid out to a government entity -
things like the airport fees, the governmental taxes, and the
vehicle licensing fee which is paid to DMV. Itemizing those
charges at the end of the transaction is appropriate, because
consumers expect those to be added on just like they would
expect a hotel to add on the hotel tax that is paid to the
municipality.
He added that some companies add on a host of "other creative
fees" to a bill; consumers are sometimes misled by them because
they may think they are required by state law. And while those
can be disclosed like the Hertz representative said, when you
get off the plane, you're tired and you don't really read the
fine print when you sign the contract. You want to get in your
car and get to the hotel. Making those full disclosures in a
meaningful comprehensive way is tricky.
2:09:57 PM
CHAIR PASKVAN closed public testimony on SB 272.
SENATOR THOMAS moved to report SB 272 from committee with
individual recommendations and zero fiscal note.
SENATOR BUNDE objected so he could thank Mr. Sniffen for his
good counsel; then he removed his objection. Therefore, SB 272
moved from committee.
2:11:26 PM
CHAIR PASKVAN announced an at ease from 2:11 p.m.
| Document Name | Date/Time | Subjects |
|---|---|---|
| SB 272 Bill Packet.pdf |
SL&C 3/11/2010 1:30:00 PM |
SB 272 |