Bill Text: IL SB0982 | 2011-2012 | 97th General Assembly | Introduced

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Bill Title: Amends the Illinois Vehicle Code. Makes a technical change in a Section concerning new vehicle dealers.

Sponsorship: Partisan Bill (Democrat 1)

Status: (Failed) 2013-01-08 - Session Sine Die [SB0982 Detail]

Download: Illinois-2011-SB0982-Introduced.html

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97TH GENERAL ASSEMBLY State of Illinois 2011 and 2012 SB0982 Introduced 2/8/2011, by Sen. John J. Cullerton SYNOPSIS AS INTRODUCED:
625 ILCS 5/5-101 from Ch. 95 1/2, par. 5-101
Amends the Illinois Vehicle Code. Makes a technical change in a Section concerning new vehicle dealers.
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A BILL FOR
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AN ACT concerning transportation.
Be it enacted by the People of the State of Illinois,
represented in the General Assembly:
Section 5. The Illinois Vehicle Code is amended by changing
Section 5-101 as follows:
(625 ILCS 5/5-101) (from Ch. 95 1/2, par. 5-101)
Sec. 5-101. New vehicle dealers must be licensed.
(a) No person shall engage in this State in the the
business of selling or dealing in, on consignment or otherwise,
new vehicles of any make, or act as an intermediary or agent or
broker for any licensed dealer or vehicle purchaser other than
as a salesperson, or represent or advertise that he is so
engaged or intends to so engage in such business unless
licensed to do so in writing by the Secretary of State under
the provisions of this Section.
(b) An application for a new vehicle dealer's license shall
be filed with the Secretary of State, duly verified by oath, on
such form as the Secretary of State may by rule or regulation
prescribe and shall contain:
1. The name and type of business organization of the
applicant and his established and additional places of
business, if any, in this State.
2. If the applicant is a corporation, a list of its

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officers, directors, and shareholders having a ten percent
or greater ownership interest in the corporation, setting
forth the residence address of each; if the applicant is a
sole proprietorship, a partnership, an unincorporated
association, a trust, or any similar form of business
organization, the name and residence address of the
proprietor or of each partner, member, officer, director,
trustee, or manager.
3. The make or makes of new vehicles which the
applicant will offer for sale at retail in this State.
4. The name of each manufacturer or franchised
distributor, if any, of new vehicles with whom the
applicant has contracted for the sale of such new vehicles.
As evidence of this fact, the application shall be
accompanied by a signed statement from each such
manufacturer or franchised distributor. If the applicant
is in the business of offering for sale new conversion
vehicles, trucks or vans, except for trucks modified to
serve a special purpose which includes but is not limited
to the following vehicles: street sweepers, fertilizer
spreaders, emergency vehicles, implements of husbandry or
maintenance type vehicles, he must furnish evidence of a
sales and service agreement from both the chassis
manufacturer and second stage manufacturer.
5. A statement that the applicant has been approved for
registration under the Retailers' Occupation Tax Act by the

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Department of Revenue: Provided that this requirement does
not apply to a dealer who is already licensed hereunder
with the Secretary of State, and who is merely applying for
a renewal of his license. As evidence of this fact, the
application shall be accompanied by a certification from
the Department of Revenue showing that that Department has
approved the applicant for registration under the
Retailers' Occupation Tax Act.
6. A statement that the applicant has complied with the
appropriate liability insurance requirement. A Certificate
of Insurance in a solvent company authorized to do business
in the State of Illinois shall be included with each
application covering each location at which he proposes to
act as a new vehicle dealer. The policy must provide
liability coverage in the minimum amounts of $100,000 for
bodily injury to, or death of, any person, $300,000 for
bodily injury to, or death of, two or more persons in any
one accident, and $50,000 for damage to property. Such
policy shall expire not sooner than December 31 of the year
for which the license was issued or renewed. The expiration
of the insurance policy shall not terminate the liability
under the policy arising during the period for which the
policy was filed. Trailer and mobile home dealers are
exempt from this requirement.
If the permitted user has a liability insurance policy
that provides automobile liability insurance coverage of

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at least $100,000 for bodily injury to or the death of any
person, $300,000 for bodily injury to or the death of any 2
or more persons in any one accident, and $50,000 for damage
to property, then the permitted user's insurer shall be the
primary insurer and the dealer's insurer shall be the
secondary insurer. If the permitted user does not have a
liability insurance policy that provides automobile
liability insurance coverage of at least $100,000 for
bodily injury to or the death of any person, $300,000 for
bodily injury to or the death of any 2 or more persons in
any one accident, and $50,000 for damage to property, or
does not have any insurance at all, then the dealer's
insurer shall be the primary insurer and the permitted
user's insurer shall be the secondary insurer.
When a permitted user is "test driving" a new vehicle
dealer's automobile, the new vehicle dealer's insurance
shall be primary and the permitted user's insurance shall
be secondary.
As used in this paragraph 6, a "permitted user" is a
person who, with the permission of the new vehicle dealer
or an employee of the new vehicle dealer, drives a vehicle
owned and held for sale or lease by the new vehicle dealer
which the person is considering to purchase or lease, in
order to evaluate the performance, reliability, or
condition of the vehicle. The term "permitted user" also
includes a person who, with the permission of the new

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vehicle dealer, drives a vehicle owned or held for sale or
lease by the new vehicle dealer for loaner purposes while
the user's vehicle is being repaired or evaluated.
As used in this paragraph 6, "test driving" occurs when
a permitted user who, with the permission of the new
vehicle dealer or an employee of the new vehicle dealer,
drives a vehicle owned and held for sale or lease by a new
vehicle dealer that the person is considering to purchase
or lease, in order to evaluate the performance,
reliability, or condition of the vehicle.
As used in this paragraph 6, "loaner purposes" means
when a person who, with the permission of the new vehicle
dealer, drives a vehicle owned or held for sale or lease by
the new vehicle dealer while the user's vehicle is being
repaired or evaluated.
7. (A) An application for a new motor vehicle dealer's
license shall be accompanied by the following license fees:
$1,000 for applicant's established place of
business, and $100 for each additional place of
business, if any, to which the application pertains;
but if the application is made after June 15 of any
year, the license fee shall be $500 for applicant's
established place of business plus $50 for each
additional place of business, if any, to which the
application pertains. License fees shall be returnable
only in the event that the application is denied by the

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Secretary of State. All moneys received by the
Secretary of State as license fees under paragraph
(7)(A) of subsection (b) of this Section prior to
applications for the 2004 licensing year shall be
deposited into the Motor Vehicle Review Board Fund and
shall be used to administer the Motor Vehicle Review
Board under the Motor Vehicle Franchise Act. Of the
money received by the Secretary of State as license
fees under paragraph (7)(A) of subsection (b) of this
Section for the 2004 licensing year and thereafter, 10%
shall be deposited into the Motor Vehicle Review Board
Fund and shall be used to administer the Motor Vehicle
Review Board under the Motor Vehicle Franchise Act and
90% shall be deposited into the General Revenue Fund.
(B) An application for a new vehicle dealer's
license, other than for a new motor vehicle dealer's
license, shall be accompanied by the following license
fees:
$1,000 for applicant's established place of
business, and $50 for each additional place of
business, if any, to which the application pertains;
but if the application is made after June 15 of any
year, the license fee shall be $500 for applicant's
established place of business plus $25 for each
additional place of business, if any, to which the
application pertains. License fees shall be returnable

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only in the event that the application is denied by the
Secretary of State. Of the money received by the
Secretary of State as license fees under this
subsection for the 2004 licensing year and thereafter,
95% shall be deposited into the General Revenue Fund.
8. A statement that the applicant's officers,
directors, shareholders having a 10% or greater ownership
interest therein, proprietor, a partner, member, officer,
director, trustee, manager or other principals in the
business have not committed in the past 3 years any one
violation as determined in any civil, criminal or
administrative proceedings of any one of the following
Acts:
(A) The Anti Theft Laws of the Illinois Vehicle
Code;
(B) The Certificate of Title Laws of the Illinois
Vehicle Code;
(C) The Offenses against Registration and
Certificates of Title Laws of the Illinois Vehicle
Code;
(D) The Dealers, Transporters, Wreckers and
Rebuilders Laws of the Illinois Vehicle Code;
(E) Section 21-2 of the Criminal Code of 1961,
Criminal Trespass to Vehicles; or
(F) The Retailers' Occupation Tax Act.
9. A statement that the applicant's officers,

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directors, shareholders having a 10% or greater ownership
interest therein, proprietor, partner, member, officer,
director, trustee, manager or other principals in the
business have not committed in any calendar year 3 or more
violations, as determined in any civil, criminal or
administrative proceedings, of any one or more of the
following Acts:
(A) The Consumer Finance Act;
(B) The Consumer Installment Loan Act;
(C) The Retail Installment Sales Act;
(D) The Motor Vehicle Retail Installment Sales
Act;
(E) The Interest Act;
(F) The Illinois Wage Assignment Act;
(G) Part 8 of Article XII of the Code of Civil
Procedure; or
(H) The Consumer Fraud Act.
10. A bond or certificate of deposit in the amount of
$20,000 for each location at which the applicant intends to
act as a new vehicle dealer. The bond shall be for the term
of the license, or its renewal, for which application is
made, and shall expire not sooner than December 31 of the
year for which the license was issued or renewed. The bond
shall run to the People of the State of Illinois, with
surety by a bonding or insurance company authorized to do
business in this State. It shall be conditioned upon the

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proper transmittal of all title and registration fees and
taxes (excluding taxes under the Retailers' Occupation Tax
Act) accepted by the applicant as a new vehicle dealer.
11. Such other information concerning the business of
the applicant as the Secretary of State may by rule or
regulation prescribe.
12. A statement that the applicant understands Chapter
One through Chapter Five of this Code.
(c) Any change which renders no longer accurate any
information contained in any application for a new vehicle
dealer's license shall be amended within 30 days after the
occurrence of such change on such form as the Secretary of
State may prescribe by rule or regulation, accompanied by an
amendatory fee of $2.
(d) Anything in this Chapter 5 to the contrary
notwithstanding no person shall be licensed as a new vehicle
dealer unless:
1. He is authorized by contract in writing between
himself and the manufacturer or franchised distributor of
such make of vehicle to so sell the same in this State, and
2. Such person shall maintain an established place of
business as defined in this Act.
(e) The Secretary of State shall, within a reasonable time
after receipt, examine an application submitted to him under
this Section and unless he makes a determination that the
application submitted to him does not conform with the

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requirements of this Section or that grounds exist for a denial
of the application, under Section 5-501 of this Chapter, grant
the applicant an original new vehicle dealer's license in
writing for his established place of business and a
supplemental license in writing for each additional place of
business in such form as he may prescribe by rule or regulation
which shall include the following:
1. The name of the person licensed;
2. If a corporation, the name and address of its
officers or if a sole proprietorship, a partnership, an
unincorporated association or any similar form of business
organization, the name and address of the proprietor or of
each partner, member, officer, director, trustee or
manager;
3. In the case of an original license, the established
place of business of the licensee;
4. In the case of a supplemental license, the
established place of business of the licensee and the
additional place of business to which such supplemental
license pertains;
5. The make or makes of new vehicles which the licensee
is licensed to sell.
(f) The appropriate instrument evidencing the license or a
certified copy thereof, provided by the Secretary of State,
shall be kept posted conspicuously in the established place of
business of the licensee and in each additional place of

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business, if any, maintained by such licensee.
(g) Except as provided in subsection (h) hereof, all new
vehicle dealer's licenses granted under this Section shall
expire by operation of law on December 31 of the calendar year
for which they are granted unless sooner revoked or cancelled
under the provisions of Section 5-501 of this Chapter.
(h) A new vehicle dealer's license may be renewed upon
application and payment of the fee required herein, and
submission of proof of coverage under an approved bond under
the "Retailers' Occupation Tax Act" or proof that applicant is
not subject to such bonding requirements, as in the case of an
original license, but in case an application for the renewal of
an effective license is made during the month of December, the
effective license shall remain in force until the application
is granted or denied by the Secretary of State.
(i) All persons licensed as a new vehicle dealer are
required to furnish each purchaser of a motor vehicle:
1. In the case of a new vehicle a manufacturer's
statement of origin and in the case of a used motor vehicle
a certificate of title, in either case properly assigned to
the purchaser;
2. A statement verified under oath that all identifying
numbers on the vehicle agree with those on the certificate
of title or manufacturer's statement of origin;
3. A bill of sale properly executed on behalf of such
person;

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4. A copy of the Uniform Invoice-transaction reporting
return referred to in Section 5-402 hereof;
5. In the case of a rebuilt vehicle, a copy of the
Disclosure of Rebuilt Vehicle Status; and
6. In the case of a vehicle for which the warranty has
been reinstated, a copy of the warranty.
(j) Except at the time of sale or repossession of the
vehicle, no person licensed as a new vehicle dealer may issue
any other person a newly created key to a vehicle unless the
new vehicle dealer makes a copy of the driver's license or
State identification card of the person requesting or obtaining
the newly created key. The new vehicle dealer must retain the
copy for 30 days.
A new vehicle dealer who violates this subsection (j) is
guilty of a petty offense. Violation of this subsection (j) is
not cause to suspend, revoke, cancel, or deny renewal of the
new vehicle dealer's license.
This amendatory Act of 1983 shall be applicable to the 1984
registration year and thereafter.
(Source: P.A. 92-391, eff. 8-16-01; 92-835, eff. 6-1-03; 93-32,
eff. 7-1-03.)