CAPSS  Compliance Pathway
Colorado Automobile/Powersport Support Services, LLC 
April 2014
Colorado Flag2     
 
  
Greetings! 
 Highlights in this newsletter include:
  
July 1st is the day that titles become available for off-road vehicles.  The Department of Revenue is actively working on pulling together and reviewing the procedures for titling these units.  They will be publishing job aids which detail these procedures for dealers, and we will let you know as soon as these are out.  Below you will find some information to help you get prepared for these changes.
  
Failing to disclose damage is becoming an epidemic as reported by the Auto Industry Division.  We have included statute and regulations here so you can remain compliant.

The Federal Trade Commission requires compliance with their Buyer's Guide rules, but selling a vehicle As-Is does not eliminate the compliance with Colorado Safety Standards. 

County Clerks have shared that odometer disclosure is the main reason title paperwork is now rejected.  Odometers account for 30% of the rejects.  We review odometer rules for you.

The Auto Industry Division is seeking input on their website so they can improve it.  We encourage everyone to fill out their survey at this link.  It just takes a minute and can be completed and submitted on-line.  Please complete this survey by Tuesday, April 29th.  https://docs.google.com/forms/d/1EUNHQNjIztvipBxVqhcQAL1Z4kM57HAkcqCmAkxbnG0/viewform

  
Also, new legislation is coming.  We will be sending out another newsletter next month detailing the actions of the legislature.
  
Thank you for your continued support of CAPSS!

Mary Marvin & Connie Hatch
CAPSS LLC

Senate Bill 13-280 
Titles for Off-Highway Vehicles
  

This bill was signed by the Governor on June 5, 2013.  SB 13-280 concerns the issuance of titles for off-highway vehicles and is explained below in part.  Off-highway vehicles have been defined in this legislation as a self-propelled vehicle that is:

  • Designed to travel on wheels or tracks in contact with the ground
  • Designed primarily for use off of the public highway; and
  • Generally and commonly used to transport persons for recreational purposes

 

Off-highway vehicles include vehicles known as all-terrain vehicles and snowmobiles, but does not include:

  • Toy vehicles
  • Vehicles designed and used primarily for travel on, over, or in the water
  • Military vehicles
  • Golf carts or golf cars
  • Vehicles designed and used to carry persons with disabilities
  • Vehicles designed and used specifically for agricultural, logging, or mining purposes
  • Motor vehicles

 

This legislation does not apply to off-highway vehicles that were first sold or transferred before July 1, 2014, until the off-highway vehicle is sold or transferred to a powersports vehicle dealer after July 1, 2014.

 

The Department of Revenue will be providing job aids that detail procedures for dealers, consumers and county clerks when titling off-highway vehicles.  As soon as these are published, we will be providing that information!

 

DOR has provided the following information:

  • Titling will not be required if an off-highway vehicle is used exclusively for agriculture purposes on private land
  • It is estimated an additional 40,000 new off-highway permits will be issued by Colorado State Parks & Wildlife this year
  • It is estimated an additional 3,320 snowmobiles will be registered annually
  • Total off-highway vehicle registrations in Colorado for 2014 is expected to be 378,762
  • DOR expects 80% of these off-highway vehicles will be titled 

 

The title must contain the make and model of the off-highway vehicle together with the motor and any other serial number of the vehicle, and a description of any other marks or symbols placed on the vehicle by the manufacturer for identification purposes.  The title shall include a description of every lien on the off-highway vehicle that appears in the application for title.

 

No person shall sell or transfer an off-highway vehicle without delivering a certificate of title duly transferred.  Upon the sale or transfer, a dealer of an off-highway vehicle for which a title has been issued, the dealer need not procure or file for a new title as long as the vehicle remains in the dealer's possession and at the dealer's place of business.  However, if a dealer wishes to obtain a new title, he may present the old title and a new title shall be issued to the dealer within one working day.

 

A dealer of off-highway vehicles shall, within 30 days after the sale, deliver or facilitate delivery of the title to the purchaser or holder of a chattel mortgage.  Upon the sale of a new off-highway vehicle, the dealer shall deliver to the purchaser a sufficient bill of sale and the Manufacturer Certificate of Origin.

 

For purpose of application of title and registration, the purchase shall register the off-highway vehicle at the person's residence except that, if an off-highway vehicle is permanently maintained at an address other than the address of the owner's residence, the vehicle must be registered at the address where the vehicle is permanently maintained.

 

Off-highway vehicle sales.  Unless the owner has obtained a title for an off-highway vehicle, a person shall not sell the off-highway vehicle and an off-highway vehicle dealer shall not purchase the off-highway vehicle.  A sale or purchase made in violation of this section is void.

 

After July 1, 2014, individuals can obtain a title by providing proof of a current Off-Highway Vehicle registration from Colorado Parks & Wildlife to their County Clerk's Office.  Dealers can obtain titles to units in their inventory by presenting a DR 2444 - Statement of Fact, for each unit to the County Clerk's Office.  Department of Revenue will be providing the wording for the Statement of Facts in the Job Aids, which are not yet available.

 

 

 

 

 

 

 

Failing to Disclose Damage
The Auto Industry Division reported that failing to disclose damage is becoming an epidemic!

The Auto Industry Division further stated that numerous dealers have been found in violation of the Dealer License Law, Rules and Regulations, along with the Deceptive Trade Procedure Act by failing to report known damage, in writing, to the purchaser of a motor vehicle.

 

Colorado State Statute 12-6-118(3)(I) states:  A motor vehicle dealer's license may be suspended, or revoked on the following grounds:  Willful misrepresentation, circumvention, or concealment of or failure to disclose, through whatsoever subterfuge or device, any of the material particulars or the nature thereof required to be stated or furnished to the buyer.

 

Regulation 12-6-118(3)(I) states:  A dealer shall disclose on the contract form when a motor vehicle is known by the dealer to be a salvage vehicle or when a motor vehicle is known to have sustained material damage at any one time from any one incident.

 

Colorado State Statute 6-1-708 applies to deceptive trade practices and states:  A person engages in a deceptive trade practice when, in the course of such person's business, such person commits any of the following acts pertaining to the sale or lease of a motor vehicle or a used motor vehicle:  Fails to disclose in writing, prior to sale, to the purchaser that a motor vehicle has sustained material damage at any one time from any one incident.

 

To summarize: any known damage to the vehicle, known by the dealer, must be disclosed in written form to the buyer at the time of sale.  That failure to disclose known damage can be cause for suspension or revocation of your dealer's license.  You can also be subject to a fine of up to $10,000 per count. 

 

 

 

As-Is Buyers Guides
Selling a motor vehicle as-is does not eliminate the compliance with Colorado Safety Standards!
  
Colorado State Statute states:  It is unlawful for any person to drive or move, or for the owner to Buyers Guidecause or knowingly permit to be driven or moved on any highway, any vehicle which is in such unsafe condition as to endanger any person, and is not at all times equipped with such lamps and other equipment in proper condition and adjustment. 

The statute specifically requires the following equipment meet safety standards pursuant to 42-4-202 through 42-4-239 C.R.S.:
  • Lights, lamps and reflectors
  • Signal lights
  • Head lights
  • Brakes
  • Tires
  • Suspension system
  • Horn
  • Muffler
  • Windows
  • Mirrors
  • Safety items - air bags, seat belts  (if these were original equipment for that vehicle)

 

A motor vehicle dealer's license may be revoked or suspended for selling to a retail customer a motor vehicle which is not equipped or in proper condition and adjustment as required by the statutes mentioned above.

 

 
  
 
County Clerk Corner
Incorrect odometer disclosures are accounting for 30% of the rejects!
Federal Truth-in-Mileage Act of 1986 mandates the disclosure and acknowledgement of odometer readings with every change in ownership on a secure document.
 
Exemptions are:
  • Vehicle is 10 years old or older
  • Vehicle's GVW is over 16,000 pounds
  • Vehicle has no odometer originally installed
  • Vehicle is sold or transferred per court order (disclose on DR 2173 to start tracking odometer 
 

New odometer reading is not required when there is no change in ownership or at least one owner remains:

  • Refinancing - owner's name does not change
  • Legal name change only
  • Adding or removing one or multiple owners on the title 

 

If the odometer is removed or broken, a disclosure must still be given on a secure form indicating the mileage as "not actual".

 

Odometer Requirements - you need all eight!

  1. Odometer Reading - in miles with no tenths
  2. Date of Sale
  3. Odometer Indicator (Actual, Not Actual, or In Excess of Mechanical Limits)
  4. Seller's Signature
  5. Seller's Hand Printed Name (not typed)
  6. Buyer's Signature
  7. Buyer's Hand Printed Name (not typed)
  8. Secure Form

 

Acceptable secured forms are:

  • Certificate of Title (Colorado or out-of-state)
  • DR 2407: Dealer's Bill of Sale for a Motor Vehicle
  • DR 2173: Motor Vehicle Bill of Sale
  • DR 2174: Power of Attorney for a Motor Vehicle
  • MSO: Manufacturer Statement of Origin
Upcoming Training Seminars

Mastery Exam Seminar:
We guide you through the confusing rules and regulations that you must know to pass the state's exam.  We also offer practice exams, which test your content knowledge and refine your test taking skills in preparation for the exam. We offer
  • In-person seminars.  The Mastery Exam is administered after the class at no extra charge.  Register at www.capsscolorado.com
  • We are currently rebuilding our On-Demand Mastery Exam Seminar with another vendor to alleviate problems with different browsers.  We hope to have this new webinar class available sometime in May.  Check our website for further information.  www.capsscolorado.com  

NOTE:  If you are a dealer or wholesaler applicant, you may need the Pre-Licensing Certification course which is an 8-hour course.  Click here for more info:  Pre-Licensing Seminar

 

 
Getting the Car Deal Rolling:  This seminar concentrates on how to complete the basic car deal paperwork involved in a sales transaction.  It includes an introduction to the required sales documents for motor vehicles and power sport sales, and to title transfer documents.  This seminar is uniquely formatted for the novice dealer/and or title clerk.   

 

 
Title Document Training:  This seminar includes basic title documents for incoming and outgoing title transfer, various title forms, applications for title, how and why to do a VIN inspection, title assignments, odometer disclosures, secure and verifiable identification and more.

 

 

The Well-Informed Dealer - Do You Think You Know It All?  Are you complying with the Federal Truth-in-Mileage Act?  Do you know what damage disclosure is required to be furnished to your customer?  If you did not know the vehicle you sold was previously salvaged, do you have to buy the vehicle back?   What charges can be added to an advertised price?  This seminar covers numerous items required for compliance of industry's rules and regulations, including OFAC,  Red Flags, and FTC Privacy Notices.  Dealers taking this class will be prepared for a compliance inspection by the Auto Industry Division.  

 

 

To register for any of these seminars, go to www.capsscolorado.com.   To schedule a class at your dealership, call Mary Marvin (Front Range) 303-478-2538; or Connie Hatch (Western Slope) 970-209-7499.
QUESTIONS ?
Do you have questions regarding odometer laws, salvage vehicles, repossessions, or more?  Benefits of your membership include phone consultations - so don't hesitate to pick up the phone and ask those questions.  Not a member?  Call now to join, only $125 a year!

Our newsletters will advise you of form updates by the state, legislative changes, and other items of interest, including compliance tips for your review.

We also offer continuing education to dealers and their employees.  We strive to give you the best education at reasonable prices.  Classes are offered on the Front Range (Lakewood) and the Western Slope (Montrose) as well as occasional classes in other parts of the state.

For more about our seminars, check out the Upcoming Training Seminars section of this newsletter, or check out web site on-line at www.capsscolorado.com.

And give us a call for all your form and supply needs!

If you have ideas on how we can better support you, please contact us! 


 Odometer
 
 
In This Issue
Off-Highway Vehicles
Damage Disclosures
AS-IS Buyers Guides
Odometers
Upcoming Training
  
  
  
  
  
  
  
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ABOUT US

CAPSS is a company owned and operated by experienced former investigators of the Colorado Department of Revenue, Auto Industry Division.  Connie Hatch retired as a Field Investigator, after 27 years of state service.   Mary Marvin retired as a Supervisor Investigator, after 32 years of state service.

For two years, Mary and Connie contracted with CIADA to provide training for their members.   Now they have moved on to better serve all dealers and wholesalers in the State of Colorado.

Contact us if we can serve you!


Front Range:  
Mary Marvin 
303.478.2538                                

Western Slope:  
Connie Hatch 
970.209.7499 
 
 
 Colorado Automobile/Powersport Support Services, LLC
CAPSS
 
 
 
Contact us if we can serve you!
 
Front Range:   Mary Marvin  (303) 478-2538    Western Slope:   Connie Hatch  (970) 209-7499 
CAPSS LLC