Bill Text: NY A08166 | 2015-2016 | General Assembly | Amended

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Bill Title: Requires used motor vehicle dealers to have a $20,000 surety bond if they sell 50 or less cars a year, and a $100,000 surety bond if they sell more than 50 cars a year.

Spectrum: Partisan Bill (Democrat 1-0)

Status: (Passed) 2016-09-29 - signed chap.342 [A08166 Detail]

Download: New_York-2015-A08166-Amended.html

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                STATE OF NEW YORK
        ________________________________________________________________________
                                         8166--A
                               2015-2016 Regular Sessions
                   IN ASSEMBLY
                                      June 10, 2015
                                       ___________
        Introduced by M. of A. CRESPO -- read once and referred to the Committee
          on Transportation -- recommitted to the Committee on Transportation in
          accordance  with Assembly Rule 3, sec. 2 -- committee discharged, bill
          amended, ordered reprinted as amended and recommitted to said  commit-
          tee
        AN  ACT to amend the vehicle and traffic law, in relation to surety bond
          requirements for car dealers
          The People of the State of New York, represented in Senate and  Assem-
        bly, do enact as follows:
     1    Section 1. Paragraphs a and c of subdivision 6-b of section 415 of the
     2  vehicle  and  traffic  law, as amended by chapter 7 of the laws of 2000,
     3  paragraph a as further amended by section 104 of part A of chapter 62 of
     4  the laws of 2011, are amended to read as follows:
     5    a. As a condition to obtaining a registration certificate pursuant  to
     6  this  section, every new motor vehicle dealer applicant and every quali-
     7  fied dealer applicant shall obtain and continue in effect a surety  bond
     8  in  an  amount  of  fifty  thousand dollars executed by a surety company
     9  authorized to transact business in the state by the department of finan-
    10  cial services of the state. As a condition to obtaining  a  registration
    11  certificate  pursuant  to  this  section,  every dealer applicant who is
    12  applying for a registration certificate in the  first  instance  or  who
    13  sold  [two hundred] fifty motor vehicles or fewer in the previous calen-
    14  dar year shall obtain and continue in effect a surety bond in an  amount
    15  of [ten] twenty thousand dollars executed by a surety company authorized
    16  to  transact  business  in  the  state  by  the  department of financial
    17  services of the state.  As  a  condition  of  obtaining  a  registration
    18  certificate  pursuant  to  this section, every dealer applicant who sold
    19  more than [two hundred] fifty motor vehicles in  the  previous  calendar
    20  year  shall  obtain and continue in effect a surety bond in an amount of
    21  [twenty-five] one hundred thousand dollars executed by a surety  company
    22  authorized to transact business in the state by the department of finan-
         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD10954-10-6
        A. 8166--A                          2
     1  cial  services  of  the state. The bonds shall be approved as to form by
     2  the commissioner and shall be conditioned on the new motor vehicle deal-
     3  er's, qualified dealer's,  and  dealer's:  payment  of  all  valid  bank
     4  drafts, including checks, drawn by such dealer for the purchase of motor
     5  vehicles;  transfer  of  good  title  to  each motor vehicle such dealer
     6  sells; safekeeping of all customer deposits related to  the  sale  of  a
     7  motor  vehicle  between the time of receipt of such customer deposit and
     8  the transfer of good title to the vehicle to the customer;  payment  for
     9  all  fines  imposed upon the new motor vehicle dealer, qualified dealer,
    10  or dealer by the commissioner pursuant to the provisions of  this  chap-
    11  ter;  and  such  dealer's  repayment of any overcharges of a customer by
    12  such dealer for the vehicle registration and titling charges payable  to
    13  the  commissioner for registering and titling the sold vehicle. Any such
    14  dealer which is bonded pursuant to this section prior to  the  effective
    15  date  of  the  chapter of the laws of two thousand sixteen which amended
    16  this paragraph shall be required to comply with the amendments  made  by
    17  such chapter upon renewal, replacement, alteration, or extension of such
    18  dealer's current surety bond.
    19    c.  Any  surety  issuing  a bond pursuant to this subdivision shall be
    20  required to provide sixty days' notice to the commissioner prior to  the
    21  effective  date  of cancellation or lapse of the bond, and shall provide
    22  additional notice to the commissioner upon the date of the  cancellation
    23  or lapse of such bond. Upon the cancellation or lapse of any surety bond
    24  required  by  this subdivision, the commissioner shall, within five days
    25  of such cancellation or lapse, verify that the  dealer  holds  a  surety
    26  bond which meets the requirements of this subdivision.
    27    § 2. This act shall take effect on the one hundred eightieth day after
    28  it shall have become a law.