COMMITTEE ON LEGISLATIVE RESEARCH
OVERSIGHT DIVISION
FISCAL NOTE
L.R. No.:1413S.02I Bill No.:SB 398 Subject:Consumer Protection; Merchandising Practices; Motor Vehicles; Revenue,
Department of; Courts; Transportation
Type:Original Date:March 6, 2023Bill Summary:This proposal modifies provisions relating to the Motor Vehicle Franchise
Practices Act.
FISCAL SUMMARY
ESTIMATED NET EFFECT ON GENERAL REVENUE FUNDFUND AFFECTEDFY 2024FY 2025FY 2026Total Estimated Net
Effect on General
Revenue $0$0$0
ESTIMATED NET EFFECT ON OTHER STATE FUNDSFUND AFFECTEDFY 2024FY 2025FY 2026Total Estimated Net
Effect on Other State
Funds $0$0$0
Numbers within parentheses: () indicate costs or losses. L.R. No. 1413S.02I
Bill No. SB 398
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ESTIMATED NET EFFECT ON FEDERAL FUNDSFUND AFFECTEDFY 2024FY 2025FY 2026Total Estimated Net
Effect on All Federal
Funds $0$0$0
ESTIMATED NET EFFECT ON FULL TIME EQUIVALENT (FTE)FUND AFFECTEDFY 2024FY 2025FY 2026Total Estimated Net
Effect on FTE 000
☐ Estimated Net Effect (expenditures or reduced revenues) expected to exceed $250,000 in any
of the three fiscal years after implementation of the act or at full implementation of the act.
☐ Estimated Net Effect (savings or increased revenues) expected to exceed $250,000 in any of
the three fiscal years after implementation of the act or at full implementation of the act.
ESTIMATED NET EFFECT ON LOCAL FUNDSFUND AFFECTEDFY 2024FY 2025FY 2026Local Government$0$0$0 L.R. No. 1413S.02I
Bill No. SB 398
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FISCAL ANALYSIS
ASSUMPTION
Officials from the Department of Revenue (DOR) assume the following regarding this
proposal:
Administrative Impact
To implement the proposed legislation, the Department will be required to:
• Update the Missouri titling manual;
• Make changes to procedures, correspondence letters, forms, and the Department website;
• Provide License Offices and stakeholders these changes as applicable; and
• Train staff
FY 2024- Motor Vehicle Bureau
Associate Research/Data Analyst 40 Hrs @ $19.90 = $796
Lead Admin Assistant 20 Hrs @ $17.05 = $341
Administrative manager 5 Hrs @ $26.96 = $135
FY 2024 Strategy and Communications Office
Associate Research/Data Analyst 10 Hrs @ $19.90 = $199
Total Cost =$1,471
The Department anticipates absorbing these costs and that there will be Minimal Impact. If
multiple bills are passed that require department resources, FTE may be requested through the
appropriations process.
Oversight assumes DOR will use existing staff and will not hire additional FTE to conduct these
activities; therefore, Oversight will not reflect the administrative costs DOR has indicated on the
fiscal note.
Officials from the Attorney General’s Office assume the proposal will have no fiscal impact on
their organization. Oversight does not have any information to the contrary. Therefore,
Oversight will reflect a zero impact in the fiscal note.
Officials from the Office of Administration did not respond to Oversight’s request for fiscal
impact for this proposal. L.R. No. 1413S.02I
Bill No. SB 398
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FISCAL IMPACT – State GovernmentFY 2024
(10 Mo.)
FY 2025FY 2026$0$0$0FISCAL IMPACT – Local GovernmentFY 2024
(10 Mo.)
FY 2025FY 2026$0$0$0
FISCAL IMPACT – Small Business
Small motor vehicle dealerships could be impacted as a result of this proposal.
FISCAL DESCRIPTION
This act modifies the Motor Vehicle Franchise Practices Act ("MVFP Act").
This act prohibits certain entities from engaging in the business of selling motor vehicles, except
as permitted by the MVFP Act, and specifies parties that shall have standing to enforce the
prohibitions.
The act also modifies how motor vehicle franchisees are compensated for warranty and other
factory compensated repairs. Warranty agreements shall be properly fulfilled, and franchisees
shall be adequately and fairly compensated for labor and parts as described in the act. In no event
shall compensation to a franchisee for labor time and rates be less than the times and rates
charged by the franchisee to retail customers for non-warranty service and repairs. Franchisors
shall reimburse franchisees for parts at the prevailing retail price charged by that franchisee. The
act prohibits reduction in payments due to pre-established market norms or averages, and
prohibits franchisors from establishing restrictions or limitations on repair frequency due to
failure rate indexes or national failure averages.
The act specifies a timeline for claims and payments under the act, including with regard to
appeals of disapproved claims. No debit reduction or charge-back shall be made on any item on a
warranty repair order absent a finding of fraud or illegal actions by the franchisee. Franchisors
shall not impose any form of cost recovery fees or surcharges against a franchisee for payments
made in accordance with the act. L.R. No. 1413S.02I
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Timely warranty claims shall not be deemed invalid solely because unavailable parts cause
additional use and mileage to the vehicle. If a franchisor imposes a recall or stop sale on any new
vehicle in a franchisee's inventory which prevents sale of the vehicle, the franchisor shall
compensate the franchisee for any interest and storage until the vehicle is repaired and made
ready for sale.
Franchisors shall not restrict the nature or extent of services to be rendered or parts to be
provided so as to prevent the franchisee from satisfying the warranty by rendering services in a
good and workmanlike manner and providing parts that are required in accordance with
generally accepted standards.
Franchisors' obligations under the act shall also apply to entities affiliated with the franchisor, as
described in the act, if a warranty or service repair plan is issued by that entity instead of or in
addition to one issued by the franchisor.
Under the act, a franchisee shall not request a franchisor to approve a different labor or parts rate
more than once per calendar year, rather than more than twice per calendar year.
This legislation is not federally mandated, would not duplicate any other program and would not
require additional capital improvements or rental space.
SOURCES OF INFORMATION
Department of Revenue
Attorney General’s Office
Julie MorffRoss StropeDirectorAssistant DirectorMarch 6, 2023March 6, 2023