AROUND THE STATES By Dennis Brown and Megan Kueck ELFA Members Achieve Relief from State Mandates During 2015 O VER THE COURSE OF 2015 , ELFA members have been active in legislative and regulatory advocacy, responding to adverse proposals that arose in multiple states. While pressing industry positions across the country, the states with the most activity were Illinois, Washington and Utah. Successful outcomes brought relief from ill-advised government actions detrimental to ELFA members operations. With the passage of this legislation, which is not retroactive, Washington now returns to the standard among states with a provision of the UCC that permits or requires an upward or downward adjustment of rent to make up for any diff erence between the projected value of a vehicle and the actual value upon lease termination. It provides a fi nancial incentive for the lessee/user as the party best able to control maintenance of the vehicle to keep it in good operating condition. Illinois Aft er the Illinois Supreme Court handed down the Hartney Fuel decision in 2013, which invalidated the state’s regula-tions for determining where to apply local sales taxes, ELFA members organized to respond. Members formed a work group and reached out to the Department of Revenue (DOR) and other interested parties. In 2014 the DOR craft ed regu-lations that left a considerable amount of ambiguity. Th e regulations off ered no guidance on when and where to ap-ply local tax to equipment lease transactions. Th e industry was fl ying blind and the ELFA work group moved forward seeking clarity. Working into 2015, ELFA members sought a permanent solution to resolve questions created with the 2014 regula-tions and draft ed a bill that was introduced during the leg-islative session. In February 2015, Sen. Toi Hutchinson (D) introduced the legislation (Senate Bill 1548). ELFA members testifi ed on behalf of the bill and worked behind the scenes, meeting with legislative members to ensure its fi nal passage. On July 23, 2015, ELFA-supported legislation was signed by Illinois Gov. Bruce Rauner (R). It took eff ect immediately, demonstrating the industry’s capability to gain relief from onerous government mandates. Th e ELFA work group will continue its advocacy work, stressing that the upcoming regulation should refl ect the new statute, which reads: SENATE BILL 1548: A retailer selling tangible personal Utah In Utah, ELFA member attorneys produced amendments to Senate Bill 93 that was designed to curtail the fi ling of fi nanc-ing statements under the UCC intended to “harass or defraud” while avoiding negative impacts opposed by all involved in the process. In addition to draft ing amendments, ELFA mem-bers provided boots on the ground by meeting with legislative members and their staff s to guarantee fi nal passage. In 2015, ELFA saw a copious amount of legislation that would have diff ering impacts on the industry. Legislation can move very quickly in states and it is important for the industry to always be vigilant during the state legislative cy-cles. With the passage of three critical pieces of legislation in 2015, ELFA ensured clarity of sales tax law with Illinois Senate Bill 1548; provided incentives for lessees to control maintenance of leased vehicles and bring a state in line with 49 others with the passage of Washington Senate Bill 5032; and avoided negative impacts of fi nancing statements under the UCC with Utah Senate Bill 93. ELFA staff soon will be preparing for the 2016 state leg-islative cycle. To get involved, please contact Dennis Brown or Megan Kueck. ■ For more information, please contact Dennis Brown , ELFA Vice President of State Government Relations, at dbrown@elfaonline.org, or Megan Kueck , ELFA Director of State Government Relations, at mkueck@elfaonline.org. property to a nominal lessee or bailee pursuant to a lease with a dollar or other nominal option to purchase is engaged in the business of selling at the location where the property is fi rst delivered to the lessee or bailee for its intended use. Illinois was not the only state where ELFA saw legislative victories this year for the industry. In Utah and Washing-ton, members also advocated for and aided in the passage of legislation. Washington In Washington, ELFA members aided in the passage of Sen-ate Bill 5032, which restored the Terminal Rental Adjust-ment Clause of the Uniform Commercial Code (UCC) that was inadvertently stripped of the state code in June 2012. 40 NOVEMBER/DECEMBER 2015 EQUIPMENT LEASING & FINANCE MAGAZINE