05/07/1999 02:50 PM House FIN

HOUSE BILL NO. 167                                                                                                              
                                                                                                                                
"An Act relating to mobile home dealers."                                                                                       
                                                                                                                                
PETER TORKELSON, STAFF, REPRESENTATIVE COWDERY testified, on                                                                    
behalf of the sponsor, in support of HB 167. He maintained                                                                      
that as originally drafted, House Bill 167 would have merely                                                                    
relieved small used mobile home dealers of burdensome                                                                           
bonding and licensure requirements under existing law.  He                                                                      
stressed that this made sense, since used dealers market                                                                        
mobile homes without warranty.                                                                                                  
Mr. Torkelson pointed out that the Labor and Commerce                                                                           
Committee heard considerable testimony on the bill and                                                                          
resolved that the entire licensure structure, while                                                                             
implemented with good intentions, really didn't serve a                                                                         
meaningful public process commensurate with its cost to                                                                         
private business.                                                                                                               
Mr. Torkelson observed that there have been no claims                                                                           
against a licensee or their bond under the existing law.                                                                        
"Indeed, it is difficult to find any compelling reason for                                                                      
regulating mobile home dealers at all." He acknowledged that                                                                    
there are third party stories of irresponsible sales agents,                                                                    
but emphasized that these aren't the ones who can afford a                                                                      
bond or are willing to comply with a licensing requirement.                                                                     
Mr. Torkelson emphasized that most mobile home dealers are                                                                      
relatively small operators.  "To them, the costs, or perhaps                                                                    
unavailability, of bonding can mean the difference between                                                                      
staying in business or going out of business.  It can mean                                                                      
the difference between operating a legitimate business, or                                                                      
one that merely exists on the margins." He maintained that                                                                      
protecting small businesses and promoting a vibrant                                                                             
community of competition is a worthy goal.                                                                                      
Mr. Torkelson acknowledged that there is opposition to the                                                                      
measure.  "They argue that protections are needed, that                                                                         
regulation is better for business.  It seems that regulation                                                                    
is better for their business, but not all business. If the                                                                      
current statutes suppress competition with burdensome                                                                           
bonding fees then surely someone will be in favor of keeping                                                                    
the status quo."                                                                                                                
Mr. Torkelson asserted that HB 167 relieves business, at no                                                                     
ascertainable risk to consumer protection.                                                                                      
GALE KINCAID, TRIAD SALES, ANCHORAGE, testified via                                                                             
teleconference in support of the legislation. He noted that                                                                     
he has owned and operated a mobile home business for the                                                                        
last 10 years. He maintained that the bond limits                                                                               
competition because most companies cannot afford the bond or                                                                    
qualify for financing on the bond. He asserted that                                                                             
businesses are forced to operate without a bond.                                                                                
                                                                                                                                
REPRESENTATIVE COWDERY, SPONSOR, questioned if Mr. Kincaid                                                                      
had every had or heard of a complaint against a licensed or                                                                     
unlicensed dealer. Mr. Kincaid responded that he was not                                                                        
aware of any complaints. He pointed out that used sales are                                                                     
on an "as is" basis. He maintained that there is no                                                                             
liability.                                                                                                                      
                                                                                                                                
Mr. Torkelson reiterated that the original bill only                                                                            
addressed used home mobile home dealers. Testimony in the                                                                       
House Labor and Commerce Committee noted that there are only                                                                    
14 licenses. If used mobile home dealers were removed there                                                                     
would only be four new home dealers left. This is too small                                                                     
of a group to support the licensing structure. The Division                                                                     
felt that it would be meaningless to retain the law. There                                                                      
were no consumers requesting protection.                                                                                        
                                                                                                                                
Co-Chair Mulder MOVED to report HB 167 out of Committee with                                                                    
the accompanying fiscal note. There being NO OBJECTION, it                                                                      
was so ordered.                                                                                                                 
                                                                                                                                
CSHB 167 (L&C) was REPORTED out of Committee with "no                                                                           
recommendation" and a zero fiscal note by the Department of                                                                     
Commerce and Economic Development dated 4/28/99.