Rent-A-Car Pass On Fees

Allows rent-a-car lessors to visibly pass on to lessees,
concession and access fees and charges paid to public airports,
provided that an annual report showing how such fees and charges
are computed, together with their amounts, shall be submitted to
the department of transportation and the department of commerce
and consumer affairs. (HB765 HD1).

HOUSE OF REPRESENTATIVES                H.B. NO.           H.D. 1        
TWENTIETH LEGISLATURE, 1999                                
STATE OF HAWAII                                            

                   A  BILL  FOR  AN  ACT



 1      SECTION 1.  The legislature finds that it will not be
 2 deceptive or misleading to allow lessors in the motor vehicle
 3 rental industry (U-drive) to separate out or "unbundle" their
 4 airport concession and access fees and charges.  This practice is
 5 taking place in many tourist destinations which compete with
 6 Hawaii.
 7      By allowing such "unbundling," U-drive lessees clearly will
 8 be able to see whether Hawaii's U-drive companies are providing
 9 them with a nationally-advertised or quoted daily rate.  Under
10 Hawaii's current law which does not allow the separate statement
11 of such fees, tourist lessees often feel they are being cheated.
12 Unhappy tourists are not good for Hawaii.
13      While the legislature is aware of the continuing efforts by
14 the National Association of Attorney Generals to update their
15 guidelines relating to "unbundling" practices, the legislature
16 finds no problem with such practices as long as they fairly
17 disclose fees and charges without being deceptive.
18      To avoid possible mistakes or abuses as to the separately
19 stated fees and charges, the legislature needs to ensure that
20 such "unbundling" is monitored and that reports are regularly

Page 2                                                     765
                                     H.B. NO.           H.D. 1        

 1 made to appropriate state agencies for purposes of addressing
 2 violations. 
 3      The purpose of this bill is to promote the understandable
 4 and nondeceptive disclosure of fees by Hawaii's U-Drive lessors
 5 by:
 6      (a) Allowing the "unbundling" of airport concession and
 7 access fees and charges so that U-drive lessees can see, by
 8 having those fees and charges shown separately from the basic
 9 rental rate, whether they are being charged the nationally
10 advertised or quoted daily rate; and
11      (b) Requiring U-drive lessors to provide annual reports
12 showing how such fees and charges were computed and stating their
13 total amounts.
14      SECTION 2.  Section 437D-8.4, Hawaii Revised Statutes, is
15 amended to read as follows:
16      "[[]437D-8.4[]]  License and registration fees.
17 Notwithstanding any law to the contrary, a lessor may visibly
18 pass on to a lessee:
19      (1)  The general excise tax attributable to the transaction;
20      (2)  The vehicle license and registration fee and weight
21           taxes, prorated at 1/365th of the annual vehicle
22           license and registration fee and weight taxes actually
23           paid on the particular vehicle being rented for each

Page 3                                                     765
                                     H.B. NO.           H.D. 1        

 1           full or partial twenty-four hour rental day that the
 2           vehicle is rented; provided the total of all vehicle
 3           license and registration fees charged to all lessees
 4           shall not exceed the annual vehicle license and
 5           registration fee actually paid for the particular
 6           vehicle rented; [and] 
 7      (3)  Concession and access fees and charges paid to public
 8           airports based on gross receipts a lessor derives from
 9           providing rental motor vehicle services at, from, or in
10           connection with public airports; provided that at the
11           end of each calendar year an annual report showing how
12           such fees and charges were computed together with their
13           total amounts shall be submitted to the department of
14           transportation and department of commerce and consumer
15           affairs within sixty days after the start of the next
16           calendar year; and
17      [(3)](4)  The rental motor vehicle surcharge tax as provided 
18           in section 251-2 attributable to the transaction. 
19 A representation by the lessor to the lessee that the visible
20 pass on of the charges in [paragraphs (1) to (3)] this section is
21 mandatory or that it is a government assessment upon the consumer
22 shall be a per se violation of section 480-2."

Page 4                                                     765
                                     H.B. NO.           H.D. 1        

 1 SECTION 3.  Statutory material to be repealed is bracketed.  New
 2 statutory material is underscored.
 3      SECTION 4.  This Act shall take effect upon its approval.