Capitol Hill Update

The NADA team continues to work on several key dealer issues: (1) challenging the ill-advised and unsubstantiated proposed FTC Vehicle Shopping Rule, (2) pursuing LIFO relief and (3) combating catalytic converter theft. Below is the background and status of these efforts:

Proposed FTC Vehicle Shopping Rule
Last July, the Federal Trade Commission (FTC) proposed a “Vehicle Shopping Rule” that would overwhelm car buyers and small businesses with additional paperwork and needlessly lengthen the sales process. The rule was proposed without credible analysis or the necessary time for public comment. While the FTC estimated the rule would save consumers money, a comprehensive study by the Center for Automotive Research found that the 10-year cost of the rule to consumers would be over $38 billion.

On July 13, 2023, the House Appropriations Committee reported out the Fiscal Year 2024 Financial Services and General Government (FSGG) appropriations bill (H.R. 4664) which included language that stops the FTC from finalizing, implementing or enforcing the “Vehicle Shopping Rule.” The companion Senate bill approved by the Senate Appropriations Committee also on July 13 (S. 2309) does not include this language. Dealers should urge members of Congress to use the “power of the purse” to reign in the FTC to prevent negative impacts on consumers and small businesses.

LIFO Relief
Due to the drastic reduction in inventory during the pandemic, dealers using the last-in, first-out (LIFO) method of accounting face significant unanticipated tax liability. The Treasury Department has existing authority (Sec. 473 of the Internal Revenue Code) to allow businesses on LIFO additional time to replenish inventory. Despite broad bipartisan support for Treasury to use this authority, Treasury declined to do so based on its belief that additional legislative authority is necessary. The Supply Chain Disruptions Relief Act specifically includes a finding that Treasury has this legislative authority. Last Congress, this legislation unanimously passed the Senate; however, time ran out before the House bill could be considered.

The Supply Chain Disruptions Relief Act was reintroduced in the House (H.R. 700) and Senate (S. 443), with nearly half the Senate signing on as original cosponsors. Dealers should urge members of Congress to cosponsor the Supply Chain Disruptions Relief Act to allow businesses on LIFO extended time to replace vehicle inventories.

Catalytic Converter Theft
Catalytic converters are being stolen at increasingly higher rates. The bipartisan Preventing Auto Recycling Theft Act (PART Act) (H.R. 621/S. 154) would help law enforcement combat this crime by providing a national framework that would mark catalytic converters, establish federal criminal penalties and create a more transparent market that deters its theft.

In May, NADA led a letter with 20 other organizations sent to the leadership of the House and Senate Commerce Committees in support of the PART Act in May. Dealers should urge members of Congress to cosponsor the PART Act to address the growing national problem of catalytic converter theft.

The Benefits of NADA Membership

NADA offers education courses, workforce recruiting and retention assistance, legislative support, compliance assistance, community outreach initiatives and much more. I encourage dealers to visit www.nada.org often to see everything NADA has to offer and catch up on the latest industry news. Other ways to support NADA are:

• Contributing to NADA PAC, which supports legislators at the national level who are interested in the welfare of the automobile retail industry, at www.nada.org/NADAPAC
• Attending events like the NADA Show and the various conferences held throughout the year. Visit www.nadashow.com for more information
• Signing up for education courses, including 20 Group meetings and online courses at www.nada.org
• Taking advantage of community outreach initiatives through the NADA Foundation at www.nadafoundation.org

If I can be of any help to you, please don’t hesitate to contact me at (706) 215-4284 or smiddlebrooks@heywardallen.com.