DEALER NEWS & INFORMATION
REGULATORY & LEGAL UPDATES
– Sales/Use Tax Rate/Collection Changes Effective July 1st, 2009
– New Daily Fee on Car Rentals Effective July 1st, 2009
– Notary Requirement Changes Effective July 1st, 2009
– Colorado Attorney General Files Objection in GM Bankruptcy & Cash for Clunkers Pasees Out of the Senate
– Upcoming Seminars
– CADA Virtual Seminar: Manufacturer Bankruptcy: What it Means and Proactive Steps- Now Available in Pre:Recorded Format!
– CADA Virtual Seminar: Employer Requirements for New COBRA Subsidy; Archive Now Available
– Dealer Management and Leadership Summit
– CADA Annual Member Golf Event
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STATE GOVERNMENT RESOURCES
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SALES/USE TAX RATE/COLLECTION CHANGES EFFECTIVE JULY 1ST, 2009
The Department of Revenue, Division of Taxation has posted the summary of sales/use tax changes effective July 1, 2009. There were very few changes this time
As a reminder, dealerships should be utilizing one of the certified, third party tax databases. While these databases should be updated with the changes highlighted above, dealership title personnel may want to double check deals in these areas on or after July 1st.
Visit also the prior Open Road articles for additional information on the third party tax databases that provide rate lookups by address.
April 2, 2008 GROUP1 TAX LOCATOR DATABASE GUIDANCE
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NEW DAILY FEE ON CAR RENTALS EFFECTIVE JULY 1ST, 2009
Beginning July 1, 2009, rentals of motor vehicles in Colorado are subject to a $2.00 rental fee for each day rented. Motor vehicles rented for periods of less than 45 days, including renewals, are subject to the fee. This includes cars, trucks, recreational vehicles (RVs), motorcycles, and motor scooters rented less than 45 days. This rental fee was enacted by the passage and signing of Colorado Senate Bill 09-108.
Collections and Disclosure:
Businesses will collect this daily rental fee from their customers and the fee should be stated separately on the customer invoice as the "Colorado Road Safety Program Fee." This fee should not be included in the amount subject to state and local sales tax. Businesses must remit the fees to Colorado Department of Revenue on a monthly basis.
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NOTARY REQUIREMENT CHANGES EFFECTIVE JULY 1ST, 2009
Several dealerships have inquired about solicitations they have received to attend training on changes to Colorado Notary laws that are effective July 1st.
Below is a link to the Colorado Secretary of State’s (SOS) Notary home page for more information – including scheduled classes that the Secretary of State’s office is offering for free:
CLICK HERE for a summary of these recent changes
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If you have questions on any legal or regulatory topic, please contact:
DISCLAIMER: CADA is not authorized to dispense legal advice.
COLORADO ATTORNEY GENERAL FILES OBJECTION IN GM BANKRUPTCY & CASH FOR CLUNKERS PASSES OUT OF THE SENATE
Colorado Attorney General John Suthers announced on Friday, June 19th, that he has joined more than two-dozen other attorneys general from across the country in objecting to General Motors’ bid to unfairly modify its auto dealership agreements as part of its bankruptcy case in a New York federal court. “GM should not force its dealerships here in Colorado to unfairly bear the burden for its past mismanagement,” Suthers said in a press release distributed by his office. “Accordingly, I have joined with other attorneys general as well as the Colorado Motor Vehicle Dealer Board to object to General Motors’ attempts through the bankruptcy proceedings to improperly overhaul the agreements it has with its dealerships.” According to the joint objection as well as an objection Colorado filed separately, GM is effectively forcing dealerships to substantially modify their agreements with the company or risk being closed. Under Colorado law, it is unlawful for an automotive manufacturer to coerce a dealership to accept an onerous dealership agreement through the threat of canceling or not renewing an existing dealership agreement. Colorado also has concerns that the sale order GM is seeking in its bankruptcy case could undercut Colorado’s regulation of manufacturer-dealership relationships. Special concessions, which would apply to a reorganized GM after the bankruptcy sale is completed could upset the even playing field all automotive manufacturers and dealers enjoy in Colorado. To review a copy of the pleadings filed by General Suthers, please click on the following:
Late last week, the US Senate approved the “Cash for Clunkers” measure, H.R. 2751/S. 1135, which will provide a benefit of approximately $4,500 for consumers that take advantage of the program. The bill is now headed to President Obama’s desk, and he is expected to sign it quickly as he publicly supported the “Cash for Clunkers” program from the beginning. Please click here for a reference chart with general guidelines about the program, as are written in the bill. Please note that the National Highway Transportation Safety Administration (NHTSA) must finalize specific rules for this process, which will be sent to dealers as soon as they are complete. Please watch for future issues of Open Road, under the Legal/Regulatory section, with specific details about the implementation of this program.
On Monday, June 22, the Colorado Legislative Council released their revenue forecast for the 09-10 fiscal year and the news was not good. Colorado lawmakers are facing a $250 million shortfall in the fiscal year ending June 30th of 2009 and will have to borrow from next year's budget to cover the shortfall. Essentially, this means that the state must fill a $384 million hole for the budget year that begins July 1. There was a combination of factors leading to this budget deficit, including the recession, the fact that sales-tax collections have plunged by double-digit percentages in the past several months, and individual income-tax payments were lower than expected. When lawmakers passed the 2009-10 budget, they knew that the current year's budget might still end up short so they gave Governor Ritter the authority to transfer up to $500 million from cash funds and reserves meant for the next year to cover the current year's deficit. As a result, it is highly unlikely there will be a special session on the budget.
Despite the success by the business community in defeating SB 273, the $500M raid on the reserve funds of Pinnacol Assurance during the 2009 Session, it is all but guaranteed there will be another bill filed during the 2010 Session to again attempt to raid Pinnacol’s reserves. CADA, along with business minded lawmakers on both sides of the aisle, stand ready to fight and defeat any future efforts to fill the state’s budget gap with Pinnacol’s private funds. To review the Colorado revenue forecast dated June 22, 2009, please click here.
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Questions or Comments? Please contact:
Melissa Kuipers – VP of Government Relations and Communications
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Colorado Automobile Dealers Association
290 East Speer Boulevard Denver, CO 80203
Telephone: 303.831.1722 | Facsimile: 303.831.4205