The 60-day legislative session has concluded, and all WVADA-supported bills passed! A special thank you to all dealers who attended committee hearings and reached out to their local representatives on behalf of WVADA’s legislative agenda.

VADA’s number one priority bill this session — SB 173: Modifying certain guidelines for motor vehicle dealers, distributors, wholesalers, and manufacturers, otherwise known as our franchise bill — has been signed by the governor and will take effect June 5, 2024.

Senator Rupie Phillips was the lead sponsor of our franchise bill this session, and he absolutely delivered every step of the way. “The dealer franchise model has proven time and time again that it is the absolute best model for consumers,” said Phillips. “I was honored to be the lead sponsor and appreciate the local economic impacts franchise dealers bring to their communities.”

Here’s a brief summary of SB 173:

• Clarifies the timeline for manufacturers to dispute the motor vehicle dealer’s request for adjustment to parts and labor rates.
• Clarifies that the 15-year period on dealer facilities applies to any subsequent dealer who obtains ownership.
• Prohibits a manufacturer from amending the dealer agreement without the motor vehicle dealer’s consent.
• Clarifies a manufacturer obligation to provide a dealer with all of its makes and models, regardless of whether the model is electric, hybrid, gas or other means of propulsion.
• Prohibits a manufacturer from exercising a right of first refusal when a motor vehicle dealer enters into a transaction to sell.
• Clarifies that a manufacturer may not interfere with or prejudice a dealer to set his own prices, trade-in values, financing terms and the price of voluntary protection products.
• Prohibits a manufacturer from treating a franchised motor vehicle dealer as simply an agent for the manufacturer as it relates to the sale and lease of motor vehicles.

Other WVADA Bills of Interest That Passed

HB 5178 permits dealers to utilize the Insurance Verification System (IVS) to verify a consumer’s insurance in real-time. This system can be tied to the current Vehicles Registration System (VRS) which is the system that is administered by the DMV and currently utilized by every WV dealership. This bill will help assist dealerships and their employees with the verification of customers insurance, especially after hours and on weekends. Permitting car dealerships in this state to utilize a search engine to determine if buyers of vehicles have valid vehicle insurance will save time and assist in streamlining customer experience.

SB 583 caps damages in a personal injury or wrongful death claim arising out of a vehicular accident with a commercial motor vehicle.

Under current law, there is no cap on any type of damages in a personal injury or wrongful death claim involving a commercial motor vehicle. This bill places a $5 million cap on noneconomic damages against an employer defendant. Of note, that cap is per plaintiff and per occurrence on personal injury and wrongful death claims.

For an employer defendant to take advantage of the cap, it must have liability insurance in the amount of at least $3 million dollars. The cap would also not apply in certain circumstances where, at the time of the incident, the operator of the commercial motor vehicle (1) was under the influence of drugs or alcohol; (2) subsequently refused to submit to a breathalyzer exam per West Virginia law; (3) was driving in excess of the hours permitted under state/federal law; (4) was engaging in reckless driving; (5) was operating an overloaded vehicle; or (6) was engaged in distracted driving.

There is an indexing provision for the cap, which is similar to medical malpractice caps. Specifically, the cap would be adjusted upward annually using the consumer price index, but it could not exceed 150% of the original $5 million dollar figure.

The section is effective on July 1, 2024, and only applies to claims arising after that date.

SB 841 provides stability for businesses on their unemployment taxes. Following the Unemployment Insurance Trust Fund growing above a $220 million balance (to a current of approximately $380-$400 million), triggers were activated which allowed both the benefits and taxes to rise and fall based on the change in the state’s average annual wage. Projections showed significant tax increases in the near future for businesses, and the legislature passed SB 841 to freeze the program at current levels. The business community strongly and successfully advocated to keep the wage base at its current level of $9,500 rather than a higher amount.

HB 5338 addresses a critical need in today’s digital landscape. With cyber threats becoming increasingly sophisticated and prevalent, dealerships must prioritize cybersecurity measures to protect customer data. This bill aims to incentivize businesses to implement effective cybersecurity measures by offering them a safe harbor from legal action in the event of a data breach, provided they have implemented and maintained a cybersecurity program.

SB 850 brings more transparency to commercial litigation by requiring the disclosure of who is financing litigation behind the scenes. Current law provides this transparency to consumer cases, and SB 850 extends the bill to commercial cases.

Also, after a potential $465 million federal claw back of pandemic-era funds for education was thrown into this year’s budgeting process, legislative leaders passed a slimmed-down budget to serve as a placeholder until lawmakers return to Charleston for a special session planned for May.

As always, thank you for your continued support.

Jared Wyrick
WVADA President