N.Y. Legislators Pass Reform Bill

ALBANY, N.Y. -- In a major victory for the car rental industry, the New York Senate and Assembly on June 20 passed a bill that would lift the state's ban on collision damage waiver (CDW) sales and eliminate a $100 cap on customer liability for vehicle damage.

If signed by Governor George Pataki, a Republican seeking a third term, the bill will finally put an end to the state's restrictive policies that have been in place since 1988. Since that time, more than 360 car rental companies in the state have gone out of business.

"I'm delighted that the legislature saw the wisdom in our arguments and the reason for the change in the statute," said Bob Muhs, vice president of governmental affairs for Avis. "We hope the governor likewise sees the wisdom in what we've put forth."

The entire car rental industry has solidly backed the reform bill, which was sponsored by Senator Thomas W. Libous (R-Binghamton, N.Y.) and Assemblyman Jeff Klein (D-Bronx, N.Y.). The bill seeks to modify a section of the state's general business law.

"It was great when the bill finally passed," said Ray Wagner, vice president of legal and legislative affairs for Enterprise Rent-A-Car. "It is the culmination of some five years of effort on this issue, and everything seemed like it was coming together this year. You always have to anticipate surprises, but I felt very comfortable this year that we were on the right track."

When asked whether Governor Pataki is expected to sign the bill, Wagner replied: "I don't think you can ever be positive. I am again cautiously optimistic that he is going to favorably receive the bill. We certainly have to do our homework to ensure that he understands what the bill is all about. And we, as an industry, have to convey to him that we are a valuable industry to the state, that we are a responsible industry for the state, and this is a very pro-consumer bill that is going to lend itself to economic development."

The bill stipulates that operators can sell CDWs for a maximum of $9 per day for vehicles with an MSRP of $30,000 or less, and a maximum of $12 per day for vehicles with an MSRP of more than $30,000.

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