Compliance Alerts
April 2024
Effective State Changes
ARIZONA
Signed into law on April 8th, HB 2410 amends prohibitions surrounding vehicle manufacturer interactions with dealerships. Among other unlawful practices, manufacturers cannot withhold vehicles, parts, or incentives from specific dealerships, coerce dealers to install an electric vehicle charging station accessible to the general public, or use or threaten the exercise of the right of first refusal in bad faith upon the change of ownership of a dealership franchise. Effective ninety days after adjournment sine die.
IDAHO
Following trends seen throughout the country, HB 689 amends current laws regarding the relationship between vehicle manufacturers and vehicle dealers. Among other items, manufacturers are prohibited from demanding certain infrastructure on dealer lots, threatening to withhold the consent for a sales service agreement to a qualified buyer in order to release claims under a franchise agreement, and competing with franchised dealers in the sale, lease, or warranty services of new motor vehicles outside of fleet sales. Effective March 27, 2024.
IOWA
SF 2362 is a new law regarding service contracts in both the residential and motor vehicle spaces. The law prohibits the sale of service contracts in Iowa unless the service company files all service contract forms with the Commissioner and accepts the cancelation of a contract via phone, email, mail, or any other cost-effective manner. Effective July 1, 2024.
KANSAS
On March 29, 2024, Kansas Governor Laura Kelly signed House Bill 2247 into law changing provisions in the state’s Uniform Consumer Credit Code (“UCCC”) and the Kansas Mortgage Business Act (“KMBA”). There are nine amendments to the KMBA with many simply recodifying similar provisions from the UCCC. Among the various changes, the act requires mandatory disclosures for credit card surcharges, allows for extended repayment plans for consumers who borrowed from a payday lender, and clarifies language around “late fees” and their assessment. The Kansas UCCC covers loans and retail installment sales. HB 2247 changes the threshold amount covered by the UCCC from $25,000 to a “threshold amount” which is defined to align with the annual increase in the consumer price index (at least $69,500 as of July 1, 2024). In addition, the bill modifies the definition of “Annual Percentage Rate” and “Closed-End Credit” to tie these definitions explicitly to 15 USC § 1606 under the Truth in Lending Act. Changes to the law for Consumer Loans include: modifying the “threshold amount” based on the language above, altering the maximum finance charge for a consumer loan under a supervised lender from a blended rate to a flat 36% rate, increasing the allowed prepaid finance charge to an amount not to exceed the lesser of 2% or $300 (previously $100), and changing the maximum term to 25 months for loans of $1,000 or less (removing the 37 month restriction for other loans). Changes to Retail Installment Sales include: modifying the “threshold amount”, adding the definition of “installment”, increasing the allowed prepaid finance charge to an amount not to exceed the lesser of 2% or $300 (previously $100), and modifying the minimum charge to a flat $10 (previously based on a $75 threshold). Effective January 1, 2025.
SB 345 creates the Commercial Financing Disclosure Act requiring new disclosures of certain commercial financing transaction terms and authorizing the Attorney General of Kansas to enforce its provisions. Among items required to be disclosed are total funds provided and disbursed, total of payments, total dollar cost of financing, the manner, frequency and amount of each payment, and a statement regarding the prepayment of any financing. Effective July 1, 2024.
KENTUCKY
HB 8 is an appropriations bill signed into law on April 12, 2024. This bill removes the $60 ownership fee for hybrid vehicles that do not have plug-in charging capability in the state of Kentucky. Effective January 1, 2025.
On April 4, 2024, HB 15 was signed into law creating Kentucky’s Consumer Data Protection Act. Now consumers’ personal data and information is protected under this statute by distinguishing data controllers from data processors. Under this new law, Kentucky residents can request corrections to wrong data, require controllers to delete certain data, and obtain a copy of personal data given to a controller, among various other rights. Effective January 1, 2026.
MINNESOTA
The Minnesota Commerce Department published the periodic adjustment in dollar amounts effective July 1, 2024, through June 30, 2026. The adjustments are based on a 10% increase. The dollar amount adjustments include:
| §47.59 Subd. 3 | Principal Subject to 33% Interest | $1,425.00 |
| §47.59 Subd. 3 | Minimum Refund | $9.50 |
| §47.59 Subd. 6 | Default Charges | $9.88 |
| §47.59 Subd. 6 | Loan Administration Fee Threshold | $ 8,208.00 |
Effective July 1, 2024.
NEW JERSEY
On March 26, 2024, AB 4011 was signed into law amending the New Jersey Transportation Trust Fund Authority Act. Amongst other provisions and appropriations, the law would impose a $250 fee for any zero-emission vehicle registered in the state. That amount would increase every year on July 1st by $10 until 2028 resulting in a fee of $290. Effective July 1, 2024.
OKLAHOMA
The Department of Consumer Credit published the changes in dollar amounts which will become effective July 1, 2024. Included in the adjustments are the following:
Retail Installment Sales, §2-201:
The greater of:
30% of the amount financed up to $1,920; plus
21% of the excess to $6,400; plus
15% of the remainder to $66,400.
—OR—
21% Simple Interest
The dollar amounts under §3-508(A) remain the same. The allowable closing fee increases from $178.87 to $184.64.
For loans subject to §3-508B of the Oklahoma Code the maximum charge structure is:
|
Loan Amount |
Acquisition Charge |
Handling Charge |
|
Up to $191.10 |
|
$6.37 per $31.86 of principal |
|
$191.10-$223.02 |
1/10 of the amount of principal |
$19.12 per month |
|
$223.03-$446.04 |
1/10 of the amount of principal |
$22.30 per month |
|
$446.05-$637.20 |
1/10 of the amount of principal |
$25.49 per month |
|
$637.21-$955.80 |
1/10 of the amount of principal |
$28.67 per month |
|
$955.81-$1,274.40 |
1/10 of the amount of principal |
$31.86 per month |
|
$1,274.41-$1,593.00 |
1/10 of the amount of principal |
$35.05 per month |
|
$1,593.01-$1,911.60 |
1/10 of the amount of principal |
$38.23 per month |
|
$1,911.61-$2,360.00 |
1/10 of the amount of principal |
$47.20 per month |
|
$2,360.01-$2,950.00 |
1/10 of the amount of principal |
$59.00 per month |
|
$2,950.01-$3,540.00 |
1/10 of the amount of principal |
$70.80 per month |
The maximum delinquency charge for consumer credit sales and consumer loans will increase from $31.00 to $32.00. Effective July 1, 2024.
UTAH
HB 491 enacts the Government Data Privacy Act. This new law defines terms and imposes governmental duties related to personal data privacy, including data breach notifications, limits on data collection, and the ability to correct data. The law also establishes the Utah Privacy Governing Board and Office of Data Privacy in order to recommend changes to data privacy laws and implement those protections across governmental entities. Effective May 1, 2024.
Effective May 1, 2024, SB 98 changes the law around cybersecurity breaches and related notification requirements. Following a breach of computerized personal data, the data owner or licensee must notify affected Utah residents, the Attorney General’s office, and the Utah Cyber Center. Among items to be included in the notification are the date the breach occurred, when it was discovered, the number of people affected, the type of information breached, and the type of security that was breached in the compromise. Effective May 1, 2024.
VIRGINIA
On April 4, 2024, HB 330 was signed into law prohibiting the financing of a dog or cat, unless the financing conforms with state and federal consumer laws. Effective July 1, 2024.
HB 744 adds new consumer protections to Virginia law regarding the automatic renewal of service offers. The law requires a supplier of services to notify the consumer of an automatic renewal and provide the consumer an option to cancel the services no less than 30 days and no more than 60 days before the cancelation deadline or end of the contract term. Effective July 1, 2024.
HB 1106/SB 452 directs independent vehicle dealers to pass a DMV examination which costs $50 in order to renew a dealership license. Effective July 1, 2024.
HB 1419 allows online vehicle dealers to sell a vehicle electronically by obtaining a title in the dealer’s name for resale. Effective July 1, 2024.
SB 222 was signed into law on April 4, 2024, and relates to cybersecurity information accessible under the Virginia Freedom of Information Act and Government Data Collection and Dissemination Act while that data is in possession of the Virginia Information Technologies Agency (“VITA”). This law requires the data to remain confidential and not subject to those disclosure laws unless designated by the Virginia Commonwealth’s Chief Information Officer or their designee from VITA. Effective July 1, 2024.
WASHINGTON
On June 6, 2024, SB 6025 will go into effect. It prohibits certain acts by lenders which seek to evade current lending requirements by, for example, making loans that appear as personal property sales or leasebacks, disguising the loan proceeds as rebates, or charging a higher rate than currently allowed under the law. Effective June 6, 2024.
WISCONSIN
On April 4, 2024, SB 668 overhauled the Department of Financial Institutions’ (“DFI”) oversight of non-mortgage licensed financial service providers. While many changes were administrative in nature, including directing DFI to utilize the Nationwide Multistate Licensing System, the new law specifically focuses on amending provisions affecting licensed lenders, collection agencies, and sellers of checks. The Licensed Lenders Law applies to non-bank consumer loans of $25,000 or less with rates exceeding 18% per year and defines consumer loans and when the Law will apply to assignments and collections under its provisions. Additionally, the Law expressly authorizes a nonrefundable prepaid finance charge in connection with consumer loans and creates a sliding scale for such charges based on the loan amount. The Collection Agencies Law revises definitions and licensing requirements for debt collectors. Finally, the Seller of Checks Law was repealed and replaced by the Model Money Transmission Modernization Act which requires licensure with the DFI to engage in practices such as selling checks and transmitting money. Effective January 1, 2025.