Dealer Update Fall 2016

POWERSPORTS DEALERS ASSOCIATION OF VIRGINIA

Well, they are correct. Virginia dealers charge our Customers 5.3%

or 6.0% sales tax on the purchase of off-road motorcycles, ATVs

and UTVs. West Virginia, Maryland and Kentucky charge a DMV

tax. North Carolina charges personal property tax. WE NEED

YOUR HELP. WITHOUT DEALER SUPPORT BOTH

FINANCIALLY AND IN CONTACTING YOUR REPRESENTATIVES

THIS ISSUE WILL FALL ON DEAF EARS. The Governor states

that there is a tax shortfall, which gives us an in to collect more tax

for the Commonwealth. We are not saying that this will increase

business in Virginia but it will certainly increase the coffers of the

Commonwealth. We are looking for reciprocity between states.

The law needs to be changed so that our Commonwealth receives what is due to them. Whether our customers purchase in state or out of state is still their option. If you feel strongly about this, please feel free to take this up with your Representative or Senator and let’s get the ball rolling.

Let me give you an example of what is happening. I spoke to the Can-Am DSM and asked him what percentage of customers in my relevant market area are purchasing out-of-state. The percentage was a stunning 35%. Take your ATV, UTV, and off-road motorcycles sales for the last month. Forty off-road vehicles were sold through a Virginia dealership. The total sales amounted to $397,099.42 making the average ticket item $9,927.49. Say that 20% of sales from your relevant market area went out of state to purchase their vehicle, the Commonwealth effectively loses $3,295.92 on 8 vehicles, which they could collect if the money is collected by the Virginia Department of Motor Vehicles regardless of whether purchased in-state or out-of-state. These people use Virginia lands whether it is the National Forest or trails and should contribute to the coffers of the Commonwealth. The Department of Motor Vehicles can collect the tax at 4.15% and send it to any fund that is chosen by the Commonwealth, therefore, it can still be sent to the general fund. The capturing of this tax will add to the coffers of the Commonwealth.

By Valerie Gaghan, Executive Director

VMDA was established in 1973 and has

been a great resource for all of our

motorcycle dealers. But over time things

have changed in our industry and it’s time

to bring the Association into the 21st

Century. As your businesses have grown

so have your business needs.

Welcome to Powersports Dealers

Association of Virginia (PSDVA). Most of

the dealerships have branched out into

ATVs, side by sides, scooters, personal

watercrafts, accessories and other

powersports items. We need to address all

these issues.

Our new name better conveys who we are,

what we do and who we support, and will

better identify with colleagues, clients and

vendors: Powersports Dealers Association

of Virginia (PSDVA).

We are revitalizing the association, which

performs valuable work for its members

and the industry. We want the active

support of the Virginia powersports

retailers. We will strive to be a leading state

association in helping its members be the

best they can be.

We value your feedback on this change and want to hear from you on any other changes you want to see. Please send your input to Valerie Gaghan, Executive Director at val.psdva@gmail.com

ARE YOU TIRED OF YOUR CUSTOMERS TELLING

YOU THAT THEY CAN GO TO WEST VIRGINIA,

MARYLAND, KENTUCKY, OR NORTH CAROLINA AND

NOT PAY SALES TAX ON OFF-ROAD MOTORCYCLES,

ATVS AND UTVS. By: Michele Schmitt, Treasurer

Powersport Dealers Association of Virginia P. O. Box 108 Scotland, MD 20687 (240) 258-5250 www.psdva.org

President Emily Franklin 804-737-7803

Vice President James Myers 540-664-3292

Secretary Kim Harrison 703-237-3410

Treasurer Michele Schmitt 540-899-9129

VMDA STAFF

Executive Director Valerie Gaghan

Legislative Advisor

Government Study Announced on Motorcycle Conspicuity September 1, 2016

The Motorcycle Riders Foundation (MRF) has reported that there are plans on the federal level to conduct a study aimed at addressing motorcycle crash prevention. The reported study will apparently examine the impact of high-visibility clothing and how such clothing effects motorcycle crashes. Being that the study is in the infant stages, there is not enough information to either endorse or oppose the study. That being said, it is good to see our friends in Washington looking at ways to prevent motorcycle crashes rather than focusing solely on surviving them. I have copied the MRF release below for those who wish to read it. We will pass on additional details on this study as information becomes available. As always, if anyone has any questions or comments please feel free to contact me. Matt Danielson McGrath, Danielson, Sorrell & Fuller The Motorcycle Law Group 1-800-321-8968 Motorcyclelawgroup.com

For Immediate Release August 30, 2016 Government Study Announced on Motorcycle Conspicuity WASHINGTON, DC – The Governors Highway Safety Association (GHSA) held its annual meeting this week in Seattle, WA. The theme for this year’s event emphasized the importance of safe driving behavior in an era of rapid technological advancement. More than 500 state highway safety officials and advocates were in attendance including government officials from the Department of Transportation, the National Highway Traffic Safety Administration as well as representatives from State Motorcycle Rights’ Organizations and the Motorcycle Riders Foundation. During the course of the conference, plans regarding an upcoming motorcycle study, funded by money in the highway bill passed by Congress late last year, were announced. Though in the early planning stages, the study is aiming to address motorcycle crash prevention. This is a pivot from previous positions from government officials whose sole focus appeared to be geared towards “safer crashing” through the practice of universal helmet laws. Though details of the upcoming study remain limited, it appears that it will examine the impact of high-visibility clothing and effects on motorcycle crashes. The project is in the solicitation process but the details suggest a hypothesis aiming to prove high visibility clothing can prevent motorcycle accidents. Details including available data, the entities or contractors conducting the study and when the study will be released will be available in the coming months. Depending on the outcome and findings of the study, legislative and regulatory activity by states and the federal government could follow. About Motorcycle Riders Foundation: The Motorcycle Riders Foundation (MRF) provides leadership at the federal level for states’ motorcyclists’ rights organizations as well as motorcycle clubs and individual riders. The MRF is chiefly concerned with issues at the national and international levels that impact the freedom and safety of American street motorcyclists. The MRF is committed to being a national advocate for the advancement of motorcycling and its associated lifestyle and works in conjunction with its partners to help educate elected officials and policymakers in Washington and beyond. All Information contained in this release is copyrighted. Reproduction permitted with attribution. Motorcycle Riders Foundation. All rights reserved. Ride With The Leaders ™ by joining the MRF at http://motorcycleridersfoundation.wildapricot.org/page-1654836 or call (202) 546-0983

News Roundup: Powersports

issues around the country and

the world By Valerie Gaghan, Executive Director

Maryland

Ken Roczen Clinches the 2016 AMA Pro Motocross Championship at Budd’s Creek (by Greg Jones— MPN)

Bel-Ray sponsored racer, Ken Roczen of RCH Suzuki Factory Racing team, clinched first place in the AMA Mo-tocross National Championship, securing his title as the 2016 450MX AMA Pro Motocross Champion with his 1-1 finish at Budds Creek National.

Wisconsin

Harley-Davidson Launches All-New Milwaukee-Eight Engine and Touring Models (by Greg Jones—MPN) More Power. More Comfort. More Control. Harley-Davidson has unveiled the all-new Milwaukee-Eight engine, the ninth Big Twin in its history, plus all-new front and rear suspen-sion for its Model Year 2017 Touring motorcycle lineup.

“These are the most powerful, most responsive and most comfortable Touring motorcycles ever offered by Harley-Davidson,” said Scott Miller, Harley-Davidson Vice Presi-dent of Styling and Product Development Strategy. “You truly have to ride one to feel the difference – so we’re invit-ing all riders to visit a Harley-Davidson dealer and take a test ride.”

United States

Klock Werks Builds ‘Tennessee Fire’ Indian Scout for Jack Daniel’s General Store (by Greg Jones—MPN)

A new Indian Scout, customized and built by Klock Werks in Mitchell, South Dakota, is a splash of fiery red in the new Nashville General Store, Jack Daniel’s first ever retail and experiential location outside of Lynchburg. The inde-pendently owned Jack Daniel’s Nashville General Store folks are fired up about their new business in the busy historical tourist area of Marathon Motors in the North-western are of Nashville TN, according to David Stang, National Director of Events and Sponsorships for Jack Daniels.

Thailand

Vee For Victory: Thai Tire Company is Win-ning the Battle for Worldwide Acceptance

Thailand is one of the world’s leading producers of natural rubber, so it only makes sense that they should be a leader in tire produc-tion at least that is how Vee Rubber sees it. From raw materials to finished products, the Thai tire company has been winning the battle to become a market leader and now produces more than 25 million tires a year, ranging from small go-kart tires to massive commercial truck tires.

Health Care Corner By W. Montgomery Dise,

President, Asset Protection Group Inc., Midlothian

The ACA Transitional Reinsurance and Risk Corridor Programs

that charge fees/taxes are set to expire effective January

1st 2017. These fees/taxes have been collected from insurance

carriers and certain employers in 2014, 2015, and 2016 in hopes

to provide rate stabilization in the health insurance marketplace. It

will be interesting to see how the expiration of these programs

affects insurance rates in 2017. Please contact me to review

your health insurance coverage.

According to Drug Benefit News, prescription drug prices grew by

an alarming 10.43% in 2015, whereas the Consumer Price Index

increased by 1.4%. Brand name drugs were up 14.8%, specialty

drugs were up 9.2%, and generic drugs were up 2.3%. As health

care costs continue to increase so do health insurance premiums.

Flexible Spending Accounts, or FSAs, can create a win-win oppor-

tunity for both the employer and the employee. One example is

the dependent care payroll deduction option for expenses such as

daycare. A married employee filing a joint tax return or a single

parent can pre-tax up to $5,000 of qualified dependent care ex-

penses through an FSA. Pre-taxing the expenses reduces both

the employer’s FICA match as well as the employee’s taxable in-

come. Please contact me with any questions at

mdise@apgroupinc. com.

Franchise Agreement Could Be In Jeopardy

By: Mark Flynn, Lobbyist

I see the effect of this issue of Tesla suing to get out from the manufacturer / franchisee arrangement on motorcycle dealers being in the bikes like Zero electrics, Arch Motorcycles, etc. As you have seen, Tesla has now lost the first round with the Virginia DMV on bypassing the franchise arrangement.

If the Michigan case goes to the US Supreme Court & Tesla wins, the franchise arrangement could fall apart.

UPDATED: 9/22/16 1:50 pm ET - adds lawsuit, statements

Tesla Motors is suing the State of Michigan in federal court over its law banning the di-rect sales of vehicles to consumers.

In the filing, Tesla stated its purpose was to “vindicate its rights under the United States Constitution to sell and service its criti-cally-acclaimed, all-electric vehicles.” The law, which the au-tomaker calls the “Anti-Tesla amendment” in the suit, was cited in the rejection of the electric-vehicle maker’s application for a state dealership license earlier this month.

Michigan Gov. Rick Snyder signed legislation in 2014 that closed a potential loophole in the state’s existing franchise law, effectively banning Tesla’s direct-to-consumer sales model.

The automaker is demanding a jury trial and has named Snyder, state Attorney General Bill Schuette and Michigan Secretary of State Ruth Johnson in the suit. A spokesman for the Michigan Department of State said in an emailed statement that the agency followed state law in the rejection of Tesla’s applica-tion.

“For the last two years, Tesla has pursued legislation in Michigan that is fair to everyone and that would benefit Michigan consumers,” a Tesla spokeswoman said in a statement. “Giving auto dealers a monopoly on car sales benefits them, but harms consumers.”

The statement added: "Unfortunately, the local auto dealers and local manufacturers have made clear that they oppose any law that would allow Tesla to operate in Michigan. Given their position, the leadership of the Michigan Legislature recently informed Tesla that it will not even hold a hearing to debate the issue. As one leading legislator told Tesla: The local auto dealers do not want you here. The local manufacturers do not want you here. So you’re not going to be here."

Michigan is the most populous state to ban Tesla stores, galleries and service stations. The automaker has been unable to obtain a dealership license from Texas, Connecticut and Utah, however it operates gal-leries and service centers in those states. Last week, Tesla was granted a license to sell its vehicles in Arizo-na after a judge ruled it had been wrongfully denied a license in May.

"The constitutional case is challenging, but has some strong support in federal case law," he wrote. "The 6th U.S. Circuit Court of Appeals, which has jurisdiction over Michigan, has ruled that economic legisla-tion that serves merely to protect special interests against competition is unconstitu-tional. A variety of neutral parties, includ-ing the U.S. Federal Trade Commission and a coalition of over 70 economists and law professors have already described direct distribution restrictions like Michigan's in exactly those terms."

"I look forward to seeing how the State of Michigan will try to defend this ban in court. It has no good arguments."

The suit against Michigan, filed in U.S. District Court in Michigan’s Western District, was reported earlier by Electrek.com.

Motorcycle Grand Tour of Virginia 2017

We are gaining ground on Sponsors for the Grand Tour.

Nelson County Visitor & Information Center—Platinum Smyth County Tourism Association—Platinum Blue Mountain Brewery—Barrellhouse and South Street Brewery—Platinum Allstar Lodging Vacation Cabin Rentals—Platinum Newport News Tourism—Platinum Luray-Page Tourism—Gold Town of Ashland Tourism— Silver Collins House Inn Bed and Breakfast—Bronze Ken’s Cycle Center—Partner

Our Executive Director, Valerie Gaghan, is visiting all are-as of Virginia, over the next 2 months to promote the Grand Tour and speak with owners/managers about the Powersports Dealers Association of Virginia.

We need your support for both the Grand Tour and our Association. There is legislation that needs to be put forth at the General Assembly and this takes funding.

We have retained a new lobbyist, Mark Flynn, to help in our quest to change and effect new laws that will be ben-eficial to all of our businesses. You can review Mark’s qualifications by Clicking Here.

Please support both your Powersports Association and the Motorcycle Grand Tour of Virginia 2017. For more information, please visit vamotorcycletour.com or psdva.com. You may reach Valerie Gaghan directly at 240-258-5250 or by email at val.psdva@gmail.com