Data Security

In 2011, state legislators across America introduced bills assigning liability for disclosure of private information stored on digital copiers to various parties including - and occasionally specifically targeting - the leasing company. ELFA advocates for a responsible, informed approach that accounts for existing security technologies and the responsibility of the information collector / end-user of equipment to ensure the security of information they manage.

• Digital Copier Data Security [Members Only]

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Electronic Recycling

California is the first and only state to institute an Advance Recycling Fee (ARF) to pay for its Electronic Recycling Program. ELFA opposes the ARF due to the difficulty lessors face in collecting the fee and supports the Extended Producer Responsibility (EPR) model adopted by 25 states as of July 2011.

• Electronic Recycling and ELFA
• California Electronic Recycling Info for Lessors
  Equipment lessors are required to collect a fee on the lease of any Covered Electronic Device into California; this covers televisions, computer monitors, laptops, and portable DVD players.

Electronic Recycling Testimony

• Connecticut Testimony opposing 2007 ARF Bill
• Massachusetts Testimony opposing 2007 ARF Bill

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Tax Law

Michigan Business Tax: The Michigan Business Tax (MBT) that established problematic barriers to true leasing has been replaced by the Corporate Income Tax (CIT) as presented in House Bill 4361 and House Bill 4362. HB 4361 replaces the complexities of the MBT with a 6% corporate income tax and eliminates a number of income and business tax exemptions. HB 4362 is companion legislation. Bank leasing subsidiaries will be taxed by the Net Capital Tax under the unitary reporting concept. ELFA member involvement has been the key to years of collaborative advocacy with the Michigan Bankers Association.

North Carolina 2011 Sales Tax Decrease: The North Carolina Department of Revenue has issued guidance for lessors that the July 1, 2011 state sales and use tax rate decrease to 4.75% applies to all existing equipment leases. ELFA members should examine the Important Notice linked below for complete information, especially local tax application.

• North Carolina Guidance for Lessors: July 1, 2011 State Sales Tax Decrease

North Carolina 2009 Sales Tax Increase: ELFA has received guidance from the North Carolina Attorney General's Office on the proper application to existing lease contracts of the 2009 1% sales and use tax increase.

• North Carolina Attorney General response to ELFA
• ELFA Request for Guidance from North Carolina

Sales Tax on Personal Property Tax: ELFA has sought guidance from several states to the application of sales and use tax on personal property tax collected by a lessor from a lessee.

• Idaho State Tax Commission Responds to ELFA Request
• DC Office of Tax and Revenue Responds to ELFA Request
• Utah Tax Commission Responds to ELFA Request

Streamlined Sales Tax Project (SSTP): The SSTP is a voluntary multi-state compact to simplify and modernize sales and use tax administration in order to substantially reduce the burden of tax compliance. ELFA supports and is an active participant in the SSTP.

• Why is SSTP Important for Leasing?
• ELFA Comments on the Alabama Streamlined Commission Preliminary Report - January 2012 ELFA urged the Alabama Streamlined Sales and Use Tax Commission to include the rental tax within its recommendations of changes that would be necessary for Alabama to join the Streamlined Sales and Use Tax Agreement.
• ELFA Comments on Recertification of Kansas and West Virginia - Sept 2011
  ELFA submitted comments on the inconsistency of regulations in Kansas and West Virginia with the Streamlined Sales and Use Tax administrative definition of a lease.

Puerto Rico Sales Tax: In 2006 Puerto Rico instituted a sales and use tax system to replace an underperforming general excise tax on imported goods.

• Puerto Rico Sales Tax Regulations -- Official English Translation
• ELFA Files Comments on Puerto Rico Sales Tax Regulations
• Puerto Rico Responds to ELFA Questions About New Sales Tax

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Other Issues

Securitization: ELFA has lobbied in conjunction with allied associations on legislation of interest.

• ELFA Opposition to 2010 New York Vehicle Lienholder Act
• ELFA Support for 2009 Texas HB 3077 and SB 1592

TRAC State Statutes: Model legislation making clear that Terminal Rental Adjustment Clause (TRAC) vehicle leases are true leases has been adopted by 48 states (all except Kentucky and New Mexico) and the District of Columbia.

• Kentucky has enacted Terminal Rental Adjustment Clause (TRAC) legislation found in Section 101 of Senate Bill 97. Upon implementation it will allow up or down adjustment of rent to accommodate a difference between projected value of a vehicle and its actual value upon lease termination. New Mexico now stands alone as a state not yet enacting TRAC.
• TRAC State Laws - September 2011
  Edwin Huddleson, AALA General Counsel, has assembled this up-to-date comprehensive list of all the TRAC/state laws and key court cases.
• TRAC State Law Links
  Links are offered solely for the convenience and easy reference of the reader and not as legal advice. Last updated September 20, 2011.

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