SB 5668 — Concerning moneys received at auctions conducted by registered tow truck operators.

S-1741.2SUBSTITUTES-0622.1SENATE SENATE BILL 5668State of Washington66th Legislature2019 Regular SessionBySenateSessionBySenators Ways & Means (originally sponsored by Senators Takko, Warnick, and Fortunato)READFortunatoAN FIRST TIME 02/27/19.AN ACT Relating to taxationmoneys ofreceived abandoned vehicles sold at auctions conducted by registered tow truck operators;

and amending RCW 82.04.040;46.55.130.BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:Sec.

creating a new section;

and providing an expiration date.BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:NEW SECTION.  Sec.

(1)RCW This46.55.130 sectionand 2017 c 152 s 2 are each amended to read as follows:(1) If, after the expiration of fifteen days from the date of mailing of notice of custody and sale required in RCW 46.55.110(3) to the registered and legal owners, the vehicle remains unclaimed and has not been listed as a stolen vehicle, a suspended license impound has been directed but no commercially reasonable tender has been paid under RCW 46.55.120, or a person eligible to redeem under RCW 46.55.120(1)(a)(viii) has not come forth providing information that the registered or legal owner of a motorcycle or moped is an admitted patient in a hospital, the taxregistered preferencetow performancetruck statementoperator forhaving custody of the taxvehicle preferenceshall containedconduct a sale of the vehicle at public auction after having first published a notice of the date, place, and time of the auction, and a method to contact the tow truck operator conducting the auction such as a telephone number, email address, or web site, in sectiona 2,newspaper chapterof .general circulation in the county in which the vehicle is located not less than three days and no more than ten days before the date of the auction.

.,For Lawsthe purposes of 2019this (sectionsection, 2a newspaper of thisgeneral act).circulation may be a commercial, widely circulated, free, classified advertisement circular not affiliated with the registered tow truck operator and the notice may be listed in a classification delineating "auctions" or similar language designed to attract potential bidders to the auction.

ThisThe performancenotice statementshall iscontain onlya intendednotification tothat a public viewing period will be usedavailable forbefore subsequentthe evaluationauction and the length of the taxviewing preference.period.

ItThe isauction notshall intended to create a private right of action by any party or to be usedheld toduring determinedaylight eligibilityhours for preferential tax treatment.(2) The legislature categorizes this tax preference as one intended to provide tax relief to certain businesses or individuals as indicated in RCW 82.32.808(2)(e).(3) It is the legislature's specific public policy objective to allow registered tow truck operators to recoup their expenditures associated with removing abandoned vehicles from the roads and highways of Washington.(4) If a reviewnormal findsbusiness thatday. the average cost of towing, storing, and disposing of an abandoned vehicle exceeds the average revenue of the sale of an abandoned vehicle by an amount greater than the value of the retail sales and use tax authorized in section 2 of this act, then the legislature intends to extend the expiration date of this tax preference.(5) In order to obtain the data necessary to perform the review in subsection (4) of this section, the joint legislative audit and review committee may refer to any data collected by the state.Sec.

2.The viewing period must be one hour if twenty-five or fewer vehicles are to be auctioned, two hours if more than twenty-five and fewer than fifty vehicles are to be auctioned, and three hours if fifty or more vehicles are to be auctioned.

RCWIf 82.04.040the andregistered 2017tow ctruck 323operator sis 201notified arethat eachthe amendedregistered toor readlegal asowner follows:(1)of Exceptthe asmoped otherwiseor providedmotorcycle is an admitted patient in thisthe subsection,hospital "sale"as meansevidenced anyby transfera ofdeclaration on a form authorized by the ownershipdepartment, of,the titleregistered to,tow ortruck possessionoperator may delay the auction of propertythe moped or motorcycle for a valuablereasonable considerationtime andin includesa good faith effort to provide additional time for the redemption of the vehicle.(2) The following procedures are required in any activitypublic classifiedauction asof such abandoned vehicles:(a) The auction shall be held in such a "salemanner that all persons present are given an equal time and opportunity to bid;(b) All bidders must be present at retail"the time of auction unless they have submitted to the registered tow truck operator, who may or "retailmay sale"not underchoose RCWto 82.04.050.use the preauction bid method, a written bid on a specific vehicle.

ItWritten includesbids leasemay orbe rental,submitted conditionalup saleto contracts,five days before the auction and anyshall contractclearly understate which possessionvehicle is being bid upon, the amount of the propertybid, and who is givensubmitting tothe bid;(c) The open bid process, including all written bids, shall be used so that everyone knows the purchaserdollar butvalue titlethat ismust retainedbe byexceeded;(d) The highest two bids received shall be recorded in written form and shall include the vendorname, asaddress, securityand telephone number of each such bidder;(e) In case the high bidder defaults, the next bidder has the right to purchase the vehicle for the paymentamount of his or her bid;(f) The successful bidder shall apply for title within fifteen days;(g) The registered tow truck operator shall post a copy of the purchaseauction price.procedure at the bidding site.

ItIf alsothe includesbidding site is different from the furnishinglicensed ofoffice food,location, drink,the oroperator mealsshall forpost compensationa whetherclearly consumedvisible uponsign at the premisesoffice orlocation not.that describes in detail where the auction will be held.

At the bidding site a copy of the newspaper advertisement that lists the vehicles for sale shall be posted;(h) The termmoneys "sale"derived doesfrom notthe includeauction, up to the transferamount of the ownershipregistered of,tow titletruck to,operator's orlien, possessionshall of:(a)constitute Ana animalpayment byof anthe animalaccumulated rescuetowing organizationand instorage exchangecharges and not consideration for the paymenttransfer of anownership, adoptiontitle, fee;or possession of the vehicle.

or(b)All Ansurplus abandonedmoneys vehiclederived soldfrom bythe aauction registeredafter towsatisfaction truckof operatorthe toregistered atow successfultruck bidderoperator's atlien publicshall auctionbe or,remitted ifwithin therethirty isdays no successful bidder, to athe licenseddepartment vehiclefor wrecker,deposit hulkin hauler,the orstate scrapmotor processor,vehicle asfund. provided in RCW 46.55.130.

NothingA inreport thisidentifying subsectionthe (1)(b)vehicles mayresulting bein construedany assurplus providingshall anaccompany exemption from:(i) The tax imposed by chapter 82.12 RCW on the useremitted offunds. an abandoned vehicle by any consumer;

or(ii)If Taxesthe imposeddirector undersubsequently thisreceives chaptera andvalid chapterclaim 82.08from RCWthe onregistered automobilevehicle towingowner andof automobilerecord storageas servicesdetermined provided by athe registereddepartment towwithin truckone operator.(2)year "Casualfrom orthe isolateddate sale"of meansthe aauction, salethe madesurplus bymoneys ashall personbe whoremitted to such owner;(i) If an operator receives no bid, or if the operator is notthe engagedsuccessful inbidder at auction, the businessoperator ofshall, sellingwithin forty-five days, sell the typevehicle ofto propertya involved.(3)(a)licensed "Leasevehicle wrecker, hulk hauler, or rental"scrap meansprocessor anyby transferuse of possessionthe orabandoned controlvehicle report-affidavit of tangiblesale, personalor propertythe operator shall apply for title to the vehicle.(3) A tow truck operator may refuse to accept a fixedbid orat indeterminatean termabandoned vehicle auction under this section for consideration.any reason in the operator's posted operating procedures and for any of the following reasons:

A(a) leaseThe orbidder rentalis maycurrently includeindebted future options to purchasethe oroperator; extend.

"Lease(b) or rental" includes agreements covering motor vehicles and trailers where the amountoperator ofhas considerationknowledge maythat be increased or decreased by reference to the amountbidder realizedhas uponpreviously saleabandoned orvehicles dispositionpurchased ofat theauction; property as defined in 26 U.S.C.

Sec.or (c) the bidder has purchased, at auction, more than four vehicles in the last calendar year without obtaining title to any or all of the vehicles.

7701(h)(1),In asno amendedcase may an operator hold a vehicle for longer than ninety days without holding an auction on the vehicle, except for vehicles that are under a police or renumberedjudicial ashold.(4)(a) The accumulation of Januarystorage 1,charges 2003.applied to the lien at auction under RCW 46.55.140 may not exceed fifteen additional days from the date of receipt of the information by the operator from the department as provided by RCW 46.55.110(3) plus the storage charges accumulated prior to the receipt of the information.

TheHowever, definitionvehicles inredeemed thispursuant subsectionto (3)RCW must46.55.120 beprior usedto fortheir salessale andat useauction taxare purposessubject regardlessto ifpayment aof transactionall isaccumulated characterizedstorage ascharges afrom lease or rental under generally accepted accounting principles, the Unitedtime States internal revenue code, Washington state's commercial code, or other provisions of federal,impoundment state,up orto local law.(b) "Lease or rental" does not include:(i) A transfer of possession or control of property under a security agreement or deferred payment plan that requires the transfertime of titleredemption.(b) uponThe completionfailure of the requiredregistered payments;(ii)tow Atruck transferoperator ofto possessioncomply orwith control of property under an agreement that requires the transfertime oflimits titleprovided uponin completionthis ofchapter requiredlimits payments, and payment of an option price does not exceed the greateraccumulation of onestorage hundredcharges dollarsto orfive onedays percentexcept ofwhere thedelay totalis requiredunavoidable. payments;

or(iii) Providing tangibleincorrect personalor propertyincomplete alongidentifying withinformation anto operatorthe fordepartment in the abandoned vehicle report shall be considered a fixedfailure orto indeterminatecomply periodwith ofthese time.time limits if correct information is available.

AHowever, conditionstorage ofcharges thisbegin exclusionto isaccrue thatagain on the operatordate the correct and complete information is necessaryprovided forto the tangibledepartment personalby propertythe toregistered performtow astruck designed.operator.--- END ---

For the purpose of this subsection (3)(b)(iii), an operator must do more than maintain, inspect, or set up the tangible personal property.(4)(a) "Adoption fee" means an amount charged by an animal rescue organization to adopt an animal, except that "adoption fee" does not include any separately itemized charge for any incidental inanimate items provided to persons adopting an animal, including food, identification tags, collars, and leashes.(b) "Animal care and control agency" means the same as in RCW 16.52.011 and also includes any similar entity operating outside of this state.(c) "Animal rescue group" means a nonprofit organization that:(i)(A) Is exempt from federal income taxation under 26 U.S.C.

Sec.

501(c) of the federal internal revenue code as it exists on July 23, 2017;

or(B) Is registered as a charity with the Washington secretary of state under chapter 19.09 RCW, whether such registration is required by law or voluntary;(ii) Has as its primary purpose the prevention of abuse, neglect, cruelty, exploitation, or homelessness of animals;

and(iii) Exclusively obtains dogs, cats, or other animals for placement that are:(A) Stray or abandoned;(B) Surrendered or relinquished by animal owners or caretakers;(C) Transferred from other animal rescue organizations;

or(D) Born in the care of such nonprofit organization other than through intentional breeding by the nonprofit organization.(d) "Animal rescue organization" means an animal care and control agency or an animal rescue group.NEW SECTION.  Sec.

3.

This act expires January 1, 2030.--- END ---