1.1                          A bill for an act 
  1.2             relating to motor vehicles; regulating licensed 
  1.3             dealers; providing exceptions; providing for separate 
  1.4             form for assignment of vehicle title; amending 
  1.5             Minnesota Statutes 1996, sections 168.27, subdivision 
  1.6             8; 168A.01, by adding a subdivision; and 168A.11, 
  1.7             subdivision 1; Minnesota Statutes 1997 Supplement, 
  1.8             section 168.27, subdivision 1. 
  1.9   BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.10     Section 1.  Minnesota Statutes 1997 Supplement, section 
  1.11  168.27, subdivision 1, is amended to read: 
  1.12     Subdivision 1.  [DEFINITIONS.] For the purposes of this 
  1.13  section, the following terms have the meanings given them: 
  1.14     (1) "Leasing motor vehicles" means furnishing a motor 
  1.15  vehicle for a fee under a bailor-bailee relationship where no 
  1.16  incidences of ownership are intended to be transferred other 
  1.17  than the right to use the vehicle for a stated period of time. 
  1.18     (2) "Brokering motor vehicles" means arranging sales or 
  1.19  leases between buyers and sellers, or lessees and lessors, of 
  1.20  motor vehicles and receiving a fee for those services. 
  1.21     (3) "Wholesaling motor vehicles" means selling new or used 
  1.22  motor vehicles to dealers for resale to the public. 
  1.23     (4) "Auctioning motor vehicles" means arranging for and 
  1.24  handling the sale of motor vehicles, not the property of the 
  1.25  auctioneer, to the highest bidder. 
  1.26     (5) "Dealer" includes licensed new motor vehicle dealers, 
  1.27  used motor vehicle dealers, motor vehicle brokers, wholesalers, 
  2.1   auctioneers, lessors of new or used motor vehicles, scrap metal 
  2.2   processors, used vehicle parts dealers, and salvage pools. 
  2.3      (6) "Commercial building" means a permanent, enclosed 
  2.4   building that is on a permanent foundation and connected to 
  2.5   local sewer and water facilities or otherwise complying with 
  2.6   local sanitary codes, is adapted to commercial use, and conforms 
  2.7   to local government zoning requirements.  "Commercial building" 
  2.8   may include strip office malls or garages if a separate entrance 
  2.9   and a separate address are maintained and the dealership is 
  2.10  clearly identified as a separate business. 
  2.11     (7) "Commercial office space" means office space occupying 
  2.12  all or part of a commercial building. 
  2.13     (8) "Horse trailer" is a trailer designed and used to carry 
  2.14  horses and other livestock, which has not more than three axles 
  2.15  and a maximum gross weight capacity of not more than 24,000 
  2.16  pounds. 
  2.17     (9) "Isolated or occasional sales or leases" means the sale 
  2.18  or lease of not more than five motor vehicles in a 12-month 
  2.19  period, exclusive of pioneer or classic motor vehicles as 
  2.20  defined in section 168.10, subdivisions 1a and 1b, or sales by a 
  2.21  licensed auctioneer selling motor vehicles at an auction if, in 
  2.22  the ordinary course of the auctioneer's business, the sale of 
  2.23  motor vehicles is incidental to the sale of other real or 
  2.24  personal property. 
  2.25     (10) "Used motor vehicle" means a motor vehicle for which 
  2.26  title has been transferred from the person who first acquired it 
  2.27  from the manufacturer, distributor, or dealer.  A new motor 
  2.28  vehicle will not be considered a used motor vehicle until it has 
  2.29  been placed in actual operation and not held for resale by an 
  2.30  owner who has been granted a certificate of title on the motor 
  2.31  vehicle and has registered the motor vehicle in accordance with 
  2.32  this chapter and chapters 168A and 297B, or the laws of the 
  2.33  residence of the owner.  
  2.34     (11) (10) "New motor vehicle" means a motor vehicle other 
  2.35  than described in paragraph (10) (9).  
  2.36     (12) (11) "Junked vehicle" means a vehicle that is declared 
  3.1   unrepairable under section 168A.151. 
  3.2      (13) (12) "Motor vehicle" has the meaning given it in 
  3.3   section 168.011, subdivision 4, and also includes a park trailer 
  3.4   as defined in section 168.011, subdivision 8. 
  3.5      (14) (13) "Motor vehicle broker" means a person who 
  3.6   arranges the sale of a motor vehicle between a buyer and a 
  3.7   seller, or the lease of a motor vehicle between a lessee and a 
  3.8   lessor, for which service the broker receives a fee. 
  3.9      Sec. 2.  Minnesota Statutes 1996, section 168.27, 
  3.10  subdivision 8, is amended to read: 
  3.11     Subd. 8.  [EXEMPTIONS.] (1) Salespeople and other employees 
  3.12  of licensed dealers under this section shall not be required to 
  3.13  obtain individual licenses. 
  3.14     (2) Isolated or occasional sales or leases of new or used 
  3.15  motor vehicles shall be exempt from the provisions of this 
  3.16  section.  A person who makes only isolated or occasional sales 
  3.17  or leases is not required to be licensed under this section, is 
  3.18  not considered to be in the business of selling or leasing motor 
  3.19  vehicles, and does not qualify to receive dealer plates under 
  3.20  subdivision 16.  "Isolated or occasional sales or leases" 
  3.21  means:  (i) the sale or lease of a motor vehicle with an actual 
  3.22  cash value of $1,000 or less made by a charitable organization; 
  3.23  (ii) the sale, purchase, or lease of not more than five motor 
  3.24  vehicles in a 12-month period., other than pioneer or classic 
  3.25  motor vehicles as defined in section 168.10, subdivisions 1a and 
  3.26  1b, or (iii) sales by a licensed auctioneer selling motor 
  3.27  vehicles at an auction if, in the ordinary course of the 
  3.28  auctioneer's business, the sale of motor vehicles is incidental 
  3.29  to the sale of other real or personal property. 
  3.30     For purposes of this subdivision, a charitable organization 
  3.31  means a nonprofit charitable organization that qualifies for tax 
  3.32  exemption under section 501(c)(3) of the Internal Revenue Code. 
  3.33     Sec. 3.  Minnesota Statutes 1996, section 168A.01, is 
  3.34  amended by adding a subdivision to read: 
  3.35     Subd. 17c.  [SECURE REASSIGNMENT.] "Secure reassignment" 
  3.36  means a separate form that (1) may be used by a dealer to assign 
  4.1   and warrant title to a vehicle; (2) is prescribed by the 
  4.2   department; and (3) contains security features complying with 
  4.3   the Motor Vehicle Information and Cost Savings Act, as amended, 
  4.4   codified at United States Code, title 49, chapter 327, and 
  4.5   regulations of the United States Department of Transportation 
  4.6   adopted under that act. 
  4.7      Sec. 4.  Minnesota Statutes 1996, section 168A.11, 
  4.8   subdivision 1, is amended to read: 
  4.9      Subdivision 1.  [APPLICATION UPON TRANSFER.] If a dealer 
  4.10  buys a vehicle and holds it for resale and procures the 
  4.11  certificate of title from the owner, and complies with 
  4.12  subdivision 2 hereof, the dealer need not apply for a 
  4.13  certificate of title, but upon transferring the vehicle to 
  4.14  another person other than by the creation of a security interest 
  4.15  shall promptly execute the assignment and warranty of title by a 
  4.16  dealer, showing the names and addresses of the transferee and of 
  4.17  any secured party holding a security interest created or 
  4.18  reserved at the time of the resale, and the date of the security 
  4.19  agreement in the spaces provided therefor on the certificate or 
  4.20  secure reassignment.  With respect to motor vehicles subject to 
  4.21  the provisions of section 325E.15, the dealer shall also, in the 
  4.22  space provided therefor on the certificate or secure 
  4.23  reassignment, state the true cumulative mileage registered on 
  4.24  the odometer or that the exact mileage is unknown if the 
  4.25  odometer reading is known by the transferor to be different from 
  4.26  the true mileage.  The transferee shall complete the application 
  4.27  for title section on the certificate of title or separate title 
  4.28  application form prescribed by the department.  The dealer shall 
  4.29  mail or deliver the certificate to the department with the 
  4.30  transferee's application for a new certificate and appropriate 
  4.31  taxes and fees, within ten days. 
  4.32     Sec. 5.  [EFFECTIVE DATE.] 
  4.33     Sections 1 to 4 are effective the day following final 
  4.34  enactment.