BUREAUCRACY and LEASING

GETTING INVOLVED MATTERS

Dennis Brown

Vice President

State Government Relations

Equipment Leasing & Finance Association

What is the Equipment Leasing and Finance Association?

New Name, New Direction:

ELFA is …

1. Forum for industry development

2. Platform to advocate for the industry

3. Principal resource for industry research

•ELFA’s NEW e-learning portal offers online courses and web seminars

•Provides high quality, interactive training and resources for the equipment leasing and finance professional

•Currently offering 2 courses for credit professionals:– Financial Statement Analysis– Should You Do the Deal – Case Studies in Equipment

Finance

•Fundamentals of Equipment Finance course to be offered Fall 2007

•18 web seminars planned for 2008

The ELFA Academy

ELFA is Principal Resource for Industry Information

• Increased public use of industry data and research - MLFI-25 - as economic indicator

• Conducting major research to develop new statistical/economic models to size the market and brand equipment finance sector

• Dramatic growth in size and breadth of Foundation

Platform to Advocate for the Industry

ELFA’s new, robust public affairs focus:• Accentuated emphasis on federal and

state government relations• Amplified grassroots activity at the state

and federal level• Increased political activity through

LeasePAC• Strategic coalition building with targeted

associations

I Work State Capitols

My Job Is To Protect You From

The People You Elect

As A Lobbyist In State Governments

I Realize Some Days I Can Be The Pigeon

But Most Days I Will Be The Statue

What Does Leasing Confront?

January 1993

My First Week On The Job

Lt. Governor Virginia Proposes Legislation

Prohibiting Tax Credits To Leased Equipment

Legislative Legal Counsel Gave Two

Reasons Leasing To Be Denied Tax Credits

What Were The Reasons?

Why Would Virginia Lt. Gov.Deny Tax Credits To Leasing?

Reason # 1

Congress has Investigated Equipment

Leasing and Found It To Be An

“Illegal Activity”

What was the Second Reason?

Why Would Virginia Lt. Gov.Deny Tax Credits To Leasing?

Reason # 2

A Federal Grand Jury

Will Soon Indict ELFA Staff

and All Our Industry Members

Electronic Recycling

ELFA Promotes Environmentally Safe Recycling and Disposal of Electronic Equipment

• ELFA Supports Producer/Manufacturer Responsibility Wherein Manufacturers Take Back Equipment and/or Pay States For Recycle/Disposal

• Our Opposition Wants Equipment Lessors and Retailers To Collect Fees and All Recycling Responsibility Falls to States

California Requires Equipment Lessors and Retailers To Collect Fees

• Supporters View Equipment Lessors as Retailers

• Requested Addresses of ELFA Member Stores

• Believe We Have Warehouses of Equipment

• Informed ELFA Our Car Dealers Are Exempt

2007 California Legislation

• Commercial Lease & Finance Companies Must Give Lessees Address of Recycling Centers in County of the Lessors Store Where Equipment was Acquired 

• Lessors Must Post Recycling Center Locations In ELFA Member Stores

• Amendment - Lessors Include Notice “at time of purchase” with “sales receipt” given all equipment users

Legislators Want To Write Lease Provisions

We Are Confused With Others:

• Consumer Rental Centers• Car Dealers/Rent To Own

Legislators Want To Give Consumer Protections

To Our Lessees

New MexicoTragic Deaths Following Allegedly FaultyMaintenance on a Scissor Lift by a Rental Center

New Mexico Senate Bill 69 would:• Eliminate choice of law provisions in Leases• Prevent lease contracts from forcing lessees to

indemnify or hold harmless another party• Enforce Vicarious Liability Upon Finance

Sources

ELFA Legal Committee Chair Teresa Davidson, Volvo Financial Services North America, led Successful Drive to Remove UCC2A From Bill

Rhode IslandReacting to Untrained Equipment Operators• Targeted Hoisting/Excavation Equipment• In One Case, Equipment Ran Off A Pier

Senate Bill 502 Would Require Special Rhode

Island Warning Sticker On Eq. Entering The State• David Miele, RBS Asset Finance and David Parr,

Bank Of America Advocated in Legislature

Amendment Exempted Commercial Transactions

Streamlined Sales Tax

ELFA Members Negotiated 2 Years on

Definition of a Lease and Sourcing Rule

• Centralized Electronic Filing In Each State• Uniform Definitions/Rules Nationwide• Simplified Exemption Processing• Destination Sourcing• Rate Simplification

What Other Misconceptions and

Erroneous Beliefs Abound?

Not All Equipment Can Be LeasedCalifornia• Shipyard Equipment and Cargo Shipping Containers

Pennsylvania• ELFA Members Met With Tax Writing Staff• Chief Counsel Accused ELFA of Untrue Statements

That Airplanes Can Be Leased

What Are Two Reasons You Can’t Lease Airplanes?

Why Airplanes Can’t Be Leased

Reason # 1

The Airlines Name

Is On The Side Of the Plane

What Was The Second Reason?

Why Airplanes Can’t Be Leased

Reason # 2

It’s Too Big

Two Lobbyist Mottos To Leave With You

• If you want the rainbow, you must put up with the rain

• If you can't be kind, at least have the decency to be vague

Thank You

Questions?