December 4, 2019 | by Sloan Schickler
A broker licensing bill is pending in the New York State (NYS) legislature that as proposed will put automobile leasing brokers, independent leasing companies and others out of business. I was retained by the New York Automobile Leasing Broker Association (NYABA) and a number of independent leasing companies in New York State to oppose the legislation. I also prepared an opposition to the legislation in my capacity as the Legal and Legislative Counsel to the National Vehicle Leasing Association (NVLA). The bill was suppressed in the legislative session that ended this past June.
Aside, from the NVLA, the NYABA, Honcker (now known as Rodo) and the Internet Association, there has not been much opposition to the proposed legislation. Initially, the auto manufacturers were opposed to the bill, but after several amendments, the burden on the automakers was removed and they withdrew their opposition.
Since the legislature went into recess at the end of June, we have been working behind the scenes to meet various members of the NYS legislature, explain the workings of the leasing and broker business and why the proposed legislation is unnecessary. We take the position that the bill will put licensed brokers and leasing companies, among others, out of business, aside from the many legal defects in the drafting. The bill is unnecessary given that there is already a comprehensive scheme to license brokers.
On October 23, 2019, I attended a roundtable concerning the bill as a representative of both the NVLA and the NYABA, along with the NYABA’s lobbyist and independent leasing and broker companies. The roundtable was convened by Senator Kevin Thomas, the Chair of the NYS Senate Consumer Protection Committee, along with Senator Diane Savino, the Chair of the NYS Senate Internet and Technology Committee and Assemblyman Robert Carroll, the bill sponsor in the NYS Assembly. Other groups attending were the United Auto Workers and local teamster representatives, the Greater New York Auto Dealers Association, the Global Automakers, the NY Auto Dealers Association, Rodo and several local auto dealers, along with their various legal counsel and lobbyists.
You can bet the discussion at the Roundtable was spirited and aggressive. The proponents insisted all brokers conduct fraudulent activity and take business away from dealerships by obtaining vehicles from dealers located outside of the customer’s zone which threatens the dealers’ existence. I was able to dispel their arguments and gain the listening ear of the Senators in attendance by demonstrating a comprehensive legislative licensing and disclosure scheme already in place, pointing out that if not enough brokers in NYS are licensed, it is a regulatory enforcement issue and further, that the dealers had not provided specific facts to back their claim of fraudulent activities perpetrated by brokers. Moreover, consumers will be penalized if leasing companies and brokers are eliminated as consumers will lose a trusted intermediary that helps arrange vehicle transactions and this will in turn reduce healthy competition among dealers.
I will continue to work on this front and no doubt things will become heated when the NYS legislature reconvenes in January.
Sloan Schickler may be reached at email@example.com or call 212-262-5297.