Legislature(1999 - 2000)
02/24/2000 03:37 PM Senate STA
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SB 262-DISABLED PLATES FOR LEASED VEHICLES
Number 2085
MS. LORETTA BROWN, aide to the Senate State Affairs Committee,
presented SB 262 for the sponsor, Senator Ward. At this time
leased vehicles are considered owned by a commercial entity.
Aplicants for handicap and/or disabled veterans plates are exempted
from paying both the registration fees and taxes; therefore the
free plates may not be used in conjunction with a commercially
owned vehicle.
SB 262 adds the words "or leased" and "owned or leased" to Section
1 of AS 28.10.181 (d) and to Section 2 of AS 28.10.421 (d)(3).
Adding this language will allow handicapped and/or disabled
veterans to place their license plates on a leased personal
vehicle.
In DMV's analysis, the fiscal note claims 5500 vehicles are
registered to disabled persons throughout the State. 20 percent of
new vehicles are leased, so 20 percent of those were applied to the
disabled population. Ms. Brown said she disagrees with that
calculation, but explained that is how the fiscal note was written.
CHAIRMAN WARD stated when he spoke with a disabled person who
leased a vehicle, he was under the assumption that he had ownership
in the vehicle. CHAIRMAN WARD said the fiscal note was of great
concern to him.
Number 1891
MR. CHUCK HOSACK, Deputy Director of Division of Motor Vehicles,
replied under Alaska statute, responsibility for paying
registration fees and taxes is placed on the owner of the vehicle.
Leased vehicles are owned by a commercial company that makes a
profit through letting others use its vehicles. The owner pays
commercial fees like for any other vehicle; rental cars, taxis,
etc. A commercial vehicle is often overlooked when people lease a
vehicle and use it for personal use.
The person leasing the vehicle has no ownership rights or interest
in the vehicle. The vehicle is registered in the name of the
leasing company. The State does not place any requirements on that
person to pay fees, and the State does not charge that person any
fees or taxes.
In a lease all costs are negotiated just like a sale. It is normal
practice in a lease agreement to let the lessee pay the
registration fees for the leasing company. This is a contract
arrangement between the company and the lessee.
SB 262 is directing Division of Motor Vehicles (DMV) to eliminate
a fee that is not charged to the individual. SB 262 exempts the
leasing company from paying the registration fees, and this creates
an inequity in fees between the company and other commercial
vehicles. DMV opposes SB 262.
If the disabled individuals want the handicapped license plates on
the vehicle for parking privilege, there is a handicapped parking
permit available at no charge.
In the fiscal note Mr. Hosack did not list operating costs, since
the vehicles are listed through the State in another form. If SB
262 passed there would be added complexities to the registration
system. The vehicles would have to be identified separately from
all other commercial vehicles.
There will be a revenue loss if these companies are exempted from
paying the higher fees. The number of leased vehicle leaving the
showroom floor is growing, however the fiscal note was calculated
with a conservative amount.
CHAIRMAN WARD stated people forget the handicapped tag that hangs
from the mirror. Could disabled plates be put on a leased vehicle
they will own? Is there no ownership with the lessee and a leased
vehicle?
MR. HOSACK stated during the lease they have no ownership in the
vehicle, that comes after the lease term is up and then the option
to buy comes into play.
SENATOR GREEN said the ability to turn the vehicle back
unilaterally is what distinguishes the vehicle from being
purchased.
SENATOR ELTON stated if you lease a vehicle it is not your asset,
as opposed to a purchased vehicle becoming your asset.
CHAIRMAN WARD asked how that works with a leased vehicle.
SENATOR ELTON stated it comes into play at the end of the lease
agreement.
SENATOR GREEN asked if there is a different level of liability for
persons leasing a vehicle from persons buying a vehicle.
MR. HOSACK stated the handicapped tag placed on the mirror can be
recognized in any state within the U.S.
SENATOR ELTON asked if the tag could be taped to the windshield.
MR. HOSACK said just as long as the tag is displayed in the
windshield, taping may solve some of the problems.
SENATOR PHILLIPS suggested that a bulletin be sent to car dealers
throughout the State asking them to explain the leasing agreement
more clearly so people will not get confused about ownership.
Number 1328
MR. HOSACK stated that DMV contributes to the dealer association
quarterly newsletter this is one way of putting the bulletin out.
CHAIRMAN WARD announced the bill would be held in committee. The
meeting was adjourned a 4:50 p.m.
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