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Governor Murphy Conditionally Vetoes Assembly Bill No. 5033; NJ CAR’s Requested Provisions Unaffected

Nov 09, 2021

On November 8th, 2021, Governor Murphy conditionally vetoed Assembly Bill No. 5033 (A5033), a bill which was unanimously approved by the Legislature on June 21, 2021, and was a top priority bill for NJ CAR.
A conditional veto is a gubernatorial response to legislation in which the Governor objects to parts of a bill and recommends amendments that would make it acceptable for signature. If the Legislature re-enacts the bill with the recommended amendments, it will be presented again to the Governor for signature. The bill has been returned to the Legislature for its action consistent with the Governor’s recommended amendments.
NJ CAR anticipates that the Legislature will concur with the Governor’s recommendations and present the bill again to the Governor for his signature. Once signed, as amended, the bill will still benefit NJ CAR members because the amendments do not reverse the provisions requested by NJ CAR.
The bill contains the five specific provisions that benefit NJ CAR members:
  • First, the bill permits on-line sales and recognizes the modern reality that some consumers prefer on-line sales for purchases and clarifying that on-line sales carried out by licensed new car dealers that were permitted during the COVID crisis will continue to be permitted by law in New Jersey.
  • Second, the bill allows the Motor Vehicle Commission (NJMVC) to accept electronically signed, non-notarized powers of attorney from licensed new car dealers immediately upon the bill’s enactment, another nod to the fact that consumers want to conduct business remotely.
  • Third, the bill requires that MVC accept electronic submissions of all motor vehicle transaction documents from licensed new car dealers for new motor vehicles; however, under the Governor’s conditional veto, the time for MVC to comply with this provision is expanded to 24 months after enactment rather than 90 days after enactment, as worded in the original bill.
  • Fourth, the bill clarifies the motor vehicle advertisement rules to allow dealers to price advertise in-bound units for sale. This provision is particularly important during the on-going vehicle inventory crisis because it allows dealers to promote in-bound inventory.
  • Fifth, the bill provides language that will restrict brokering by used car dealers by amending the definitions of new and used car dealers. It expands the scope of practice of new car dealers to include both new and used cars and limits used car dealers’ scope of practice to only used cars, thereby closing a loophole that some used car dealers exploited to broker new cars. This provision will not stop brokering but will stop used car dealers from acting as “licensed” brokers.
In his conditional veto statement, the Governor also added an additional provision requiring that MVC establish a schedule to permit the notification, recording, transfer and release of security interests and title information by the lienholders of motor vehicles in lieu of a paper-based system. This will speed and simplify lien recordation and release and facilitate consumer finance.
The recommended amendments will:
  1. enable the electronic submission and receipt of all motor vehicle transaction documents for new motor vehicles within 24 months.
  2. enable MVC to promulgate regulations to authorize the electronic execution of mileage disclosure.
  3. enable MVC to facilitate electronic instead of paper-based notification, and recording, transfer, and release of security interests and title information by motor vehicle lienholders, which will make motor vehicle financing and refinancing more efficient.