President Obama Signs Raechel and Jacqueline Houck Safe Rental Car Act
Work still needed to close car dealers' "Loaner car loophole"
Raechel and Jacqueline Houck were killed by a recalled rental car
After over 5 years of battles, the U.S. Congress passed the Raechel and Jacqueline Houck Rental Car Safety Act in the federal Highway Bill, known as the "DRIVE Act," and President Obama signed it into law. The Act is scheduled to take effect next June. It will prohibit nearly all rental car companies, including many car dealers, from renting, loaning, or selling recalled vehicles until the safety defects have been repaired. Existing federal law prohibits dealers from selling recalled new vehicles, but there was no similar federal law regarding rentals and loaner cars.
The new law is a major new expansion of the National Highway Traffic Safety Administration's authority over safety recalls. For the first time, the agency will be able to police used vehicles provided by rental car companies, including car dealers, as rentals or loaners. Nearly all vehicles rented or sold by rental car companies will be required to be safe. Rental car companies are the largest purchasers of new cars in North America. They are also among the largest sellers of used cars. So this means that millions of used cars will also be safer, when they re-enter the used car market. However, thanks to a last-minute loophole added at the behest of auto dealers, the Act would apply only if the company rents or loans a fleet of 35 or more vehicles, on average – exempting many auto dealers. If a dealer rents, loans, or sells an unsafe recalled car, it would still be a violation of various state laws, but NHTSA is not able to enforce those laws.
Cally Houck has been a tireless advocate for improving rental and loaner car safety
“I'm thrilled that we've finally passed the Rental Car Safety Act named for my beautiful, treasured daughters, Raechel and Jacqueline. But I'm worried about the loaner car loophole for car dealers and remain committed to closing that dangerous safety gap,” said Cally Houck, Mother of Raechel and Jacqueline Houck, who were ages 24 and 20 when they were killed by a recalled rental car.
The leading champions for passage of the Act were U.S. Senators Schumer, Boxer, McCaskill, Nelson, and Blumenthal, and Representatives Capps, Schakowsky, Butterfield, and Jones. The Senate measure was also co-sponsored by Senators Casey, Feinstein, Gillibrand, and Markey. The Obama Administration was also strongly supportive of passage.
Thanks to the new law, the National Highway Traffic Safety Administration will be able to police rental car companies and dealers who have fleets of 35 or more rentals or loaner vehicles, and fine them if they violate the law – preventing tragedies like the crash that killed Raechel and Jackie.
The Senate and House both rejected attempts by the auto manufacturers and car dealers to kill the bill, or to allow rentals and loaners of recalled vehicles with “disclosure,” which would merely shift liability onto the victims of unsafe vehicles. The rental car industry, including Enterprise, Hertz, Avis, Dollar-thrifty, Alamo, National, and the American Car Rental Association, as well as many smaller rental car companies, helped persuade lawmakers to vote for the Act, and worked alongside Cally Houck and CARS for passage of the new law. The lone exception was the owner of Rent-a-Wreck, Jack Fitzgerald, a car dealer, who actively opposed the bill and lobbied against its passage.
US Rep. Roger Williams (R-Texas), a car dealer, introduced a special-interest amendment to exempt car dealers from the bill, and to allow them to rent or loan unrepaired recalled vehicles regardless how unsafe they are, or how many people they have maimed or killed, without having to worry about NHTSA enforcement. U.S. Rep. Lois Capps (D-CA), and Rep. Jan Schakowsky (D-IL) argued against the dealer loophole on the House Floor, pointing out that the amendment would mean that consumers who take a recalled car to a dealer for repairs could be loaned another recalled car with the exact same defect. Despite polling showing that the public overwhelmingly opposes this loophole, the Williams amendment passed near midnight, with few Representatives left on the House floor to cast votes, by a voice vote, with some voting “No.”
While Rep. Williams claimed that the loaner loophole would apply only to minor problems that do not affect safety, it would actually apply to ALL safety recalls, including defects such as catching on fire, brake failures, loss of steering, stalling in traffic, wheels that fall off, axles that break, child safety seat anchors that fail, seat belts that break apart in a crash, and air bags that spew shrapnel that blinds people and slices into their necks, causing them to bleed to death.
Rep. Williams also claimed that no dealer would loan or sell an unsafe vehicle. However, many news reports have exposed cases where dealers have handed customers the keys to vehicles with potentially lethal safety defects, causing crashes and even catching a home on fire. In one tragic crash, four family members were killed by an unsafe Lexus loaner car. In Texas, Carlos Solis was killed by a recalled used car with an exploding Takata air bag when a dealer failed to get the car repaired prior to sale. CarMax, the largest retailer of used cars in the nation, openly admits that it sells large numbers of unsafe recalled vehicles without bothering to get the free safety recall repairs done first.
According to the National Highway Traffic Safety Administration, “All safety recalls resulting from defects present an unreasonable risk to safety and we believe it is inappropriate to suggest that some defects are not risky enough to require repair. For the safety of the motoring public, all recalled vehicles should be fixed promptly.”1
Recently, the Campaign Legal Center urged the House Ethics Committee and the Office of Congressional Ethics (OCE) to review Texas Republican Rep. Roger Williams' conduct in authoring a special-interest amendment that would benefit his own business, as a car dealer.
The Act will improve both rental car and used car safety, by reducing the numbers of recalled rental and used cars that re-enter the used car market. However, Congress failed to close the used car safety gap, due to heavy opposition from the National Automobile Dealers Association.
To its credit, AutoNation has publicly announced that they guarantee a recall-free vehicle, including used cars. They have also announced that they will not penalize consumers who trade in a vehicle with an open recall by dinging them over the price.
Good News: AT LAST!! Congress close to passing federal rental safety recall legislation Bad News: Car dealer Congressman from Texas adds loophole to allow car dealers to rent or loan recalled ticking-time-bomb cars
First, the good news: Congress is days away from FINALLY passing the Raechel and Jacqueline Houck Rental Car Safety Act, to prohibit rental car companies from renting, loaning or selling recalled cars. The Senate passed the Act last month, and the House also passed it recently, as part of the national highway funding bill. That is expected to pass soon and go to President Obama for a signature. One of the best things about the Act -- it will give the National Highway Traffic Safety Administration the authority to crack down over violators, even if no one is injured or killed -- preventing tragic crashes like the one that killed Raechel and Jackie.
U.S. Rep. Roger Williams, a car dealer, adds car dealer loophole to Rental Car Safety Act.
BUT -- near midnight on the day the Act passed out of the U.S. House of Representatives, U.S. Rep. Roger Williams (R-Texas), a car dealer, got a special-interest loophole added to the bill to allow car dealers to rent or loan recalled ticking-time-bomb cars to consumers. It passed by a voice vote (with no record of who voted for or against it) when very few U.S. Representatives were still on the House Floor. Rep. Williams owns a Fiat-Chrysler dealership in Weatherford, Texas, west of Dallas. He boasted that he's been a dealer for decades. The only other member of the House who spoke in favor of the dangerous loophole is another car dealer, Rep. Kelly (R-Pennsylvania).
If the car dealer loophole stays in the bill, car dealers could rent, sell, or loan defective recalled vehicles to customers who leave their cars for repairs, without violating the new law. Dealers want this loophole so they can evade a crack-down by the National Highway Traffic Safety Administration to stop them from renting or loaning unsafe cars to the public. Imagine -- if you have a car that is being recalled because the defective Takata air bags may explode and slice through your neck, the dealer could rent or loan you a car with the exact same safety defect.
Who is opposed to the car dealers' lethal car loophole?
Carol "Cally" Houck, Mother of Raechel and Jacqueline Houck, who were killed by an unrepaired recalled rental car
Rep. Lois Capps (D-California) and Rep. Jan Schakowsky (D-Illinois), who spoke against the dealer loophole and for protecting consumers from unsafe rental and loaner cars
Consumers for Auto Reliability and Safety
The rental car industry, including all the major rental car companies and the American Car Rental Association (except Rent-a-Wreck)
Other non-profit consumer groups and safety organizations
What you can you do to oppose the dealer loophole?
Call your members of Congress and urge them to oppose this dangerous loophole. Here's the number to call at the U.S. Capitol, where they can put you in touch with your member of Congress: 202-225-3121. Message: "I think rental and loaner cars should be safe to drive. Please OPPOSE the car dealer loophole in the DRIVE Act."
Sign Cally Houck's petition on Change.org, and send a message to U.S. Rep. Fred Upton, who is from Michigan and close to auto manufacturers and car dealers. He is expected to play a crucial role in deciding whether the dealers get their dangerous loaner car loophole.
Contact: CJ Young
Capps Votes for Long-term Highway Funding Bill Legislative package includes Capps’ rental car safety bill
WASHINGTON—Today, Reps. Lois Capps voted to support the Fixing America's Surface Transportation (FAST) Act bipartisan conference report, a compromise highway and transportation bill that included her Raechel and Jacqueline Houck Safe Rental Car Act (H.R. 2198). The legislative package was negotiated in conference committee after both the House and Senate passed separate transportation bills earlier this year.
“The FAST Act is an important compromise to support our nation’s transportation infrastructure,” Capps said. “I am particularly pleased that it includes my bipartisan rental car safety bill, which for the first time will prohibit the vast majority of rental car companies and auto dealers from renting and loaning dangerous recalled cars to consumers. While I am disappointed this language was weakened by special interests during conference to exempt smaller operations, this is an important step forward for consumer safety as we work to hold all rental car companies and auto dealers accountable. All Americans should be confident that the cars they drive are safe.”
The rental car safety legislation is named in honor of sisters Raechel and Jacqueline Houck of Ojai, Calif. These young sisters, ages 24 and 20, were tragically killed while driving a recalled Chrysler PT Cruiser rented from Enterprise in 2004. Congresswoman Capps first introduced this bill in Congress in 2012.
“I'm thrilled that we're finally close to passage of the Rental Car Safety Act named for my beautiful, treasured daughters, Raechel and Jacqueline,” said Cally Houck, Mother of Raechel and Jacqueline Houck. “I want to thank my Senator Barbara Boxer and my Representative Lois Capps who have diligently supported our legislation. However, I'm deeply concerned about the loaner car loophole for car dealers and remain committed to closing that dangerous safety gap.”
During the bicameral conference committee negotiations, a change was made to the Capps bill that would exempt rental car companies and auto dealers with 35 or fewer rental or loaner vehicles. However, a previously adopted amendment by Rep. Roger Williams (R-TX-25) that would have exempted all auto dealers from the rule was not included in the final bill.
The Highway Conference Report, named the FAST Act, authorizes 5 years of federal funding for our nation’s surface transportation infrastructure, including our roads, bridges, public transit systems, and rail transportation network. The FAST Act establishes a new freight grant program to improve the movement of goods through congested highways and would increase maximum civil penalties for automakers that withhold information on vehicles with safety defects from $35 million to $105 million.
“We’re very pleased that Congress is passing a five-year transportation bill that sets funding levels for highways, roads, bridges and passenger rail. We desperately need the new funding and the certainty that the FAST Act would provide to plan and complete transportation infrastructure improvements and repairs,” said Jim Kemp SBCAG Executive Director.
Enclosed below are Rep. Lois Capps’ remarks as prepared:
Mr. Speaker, the bipartisan Highway conference compromise before us is just that—a compromise—and despite its faults I will support it.
While this bill will adequately fund our nation’s long-term highway infrastructure needs—something our communities desperately need – it falls short of making the robust, long-term investments our crumbling infrastructure truly needs.
I am pleased the bill takes an important step to protect consumers by prohibiting companies from renting or loaning out dangerous recalled vehicles for the first time.
I have spearheaded this effort for years in honor of Raechel and Jacqueline Houck, two young sisters who were killed by their rented vehicle that was under recall.
To be clear, this is an important step for consumer safety.
But I am incredibly disappointed that during conference, companies with less than 35 rental or loaner vehicles were exempted.
Unfortunately, by bowing to special interests, some consumers will still be at risk.
However, we will continue to build on this important step of holding large rental car companies and auto dealers accountable until all Americans can be confident that the cars they drive are safe.
In a unanimous, bi-partisan vote, Senators on the U.S. Senate Commerce Committee voted to make it a violation of federal law for a rental car company to rent or sell unsafe recalled cars, once they receive the safety recall notice, until the safety defects have been repaired. If that provision is enacted, it will be good news for everyone who rents cars, their families and other passengers, and everyone who shares the roads. It will also help improve used car safety.
Sisters Raechel and Jacqueline Houck.
Senator Claire McCaskill (D-Missouri) championed that amendment, adding the Raechel and Jacqueline Houck Safe Rental Car Act, named in memory of two sisters, ages 24 and 20, who were killed by a recalled rental car. Their mother, Cally Houck, of Ojai, California, has become a tireless advocate for making it the law of the land. The Act is sponsored Senator Schumer (D-NY), and cosponsored by Senators Blumenthal, Boxer, Casey, Feinstein, Gillibrand, Nelson, and McCaskill. CARS has been spearheading enactment, working closely with our representative in Washington, DC, Pamela Gilbert, and with Cally Houck and our allies in the auto safety community.
“When consumers and families drive a rental car off the lot, they should be able to do so with the confidence
that car is safe to drive. We’re one step closer to that peace of mind today.” * -- U.S. Senator Claire McCaskill (D - Missouri) * Bloomberg News: " Senate Panel Reverses Course on Rentals of Recalled Vehicles," by Jeff Plungis, July 15, 2015.
The bill, S 1173, is also supported by all of the major auto rental car companies including Enterprise, Hertz, and Avis, as well as the American Car Rental Association, and many smaller rental car companies (except Rent-a-Wreck), who have been actively working with CARS and Cally Houck to gain passage. It is also supported by General Motors, Honda, the AAA, and State Farm Insurance Company, as well as the International Association of Machinists and Aerospace Workers. The IAMAW represents thousands of automotive technicians who perform safety recall repairs at new car dealerships. They estimate that enactment will create thousands more good-paying jobs for skilled workers. According to the Wall Street Journal, AutoNation -- the country's largest auto dealership chain -- hired over 400 auto mechanics to expedite repairs on vehicles with the GM ignition switch defect.
A recalled Chrysler PT Cruiser rental car claimed the lives of Raechel and Jacqueline Houck, ages 24 and 20.
The initial version of the bill proposed by Sen. Thune and the Republicans would have legalized rentals and sales of unsafe recalled cars, under federal law, undermining important state protections against killer rental cars. However, thanks to the strong stand taken by Senators McCaskill, Boxer, Schumer, and other Democratic Senators, and a wave of publicity exposing the pitfalls of the initial rental car provision, the Republicans backed down. Polling in Sen. Thune's home state of South Dakota also showed that his own constituents overwhelmingly favor ensuring that rental cars are actually safe to drive from the moment they are handed the keys.
The new, pro-safety rental car provision is now included in a larger transportation safety bill proposed by Republicans who rely on auto industry campaign contributions. It includes many provisions that would actually weaken safety. Among other horrible ideas, it would allow 18-year-olds to drive 80,000-pound big rig trucks on the nation's interstate highways. This is obviously nuts. But the trucking industry wants to be allowed to cut corners and increase their profits by hiring lower-wage, less-experienced drivers, so the Republicans put this nutty idea into their bill.
The Republican bill also fails to prohibit car dealers from selling unsafe recalled used cars to consumers, or to provide the National Highway Traffic Safety Administration the authority to levy fines sufficient to persuade auto manufacturers to perform safety recalls instead of trying to conceal safety defects, particularly when millions of cars have the same defect. The maximum fine allowed under the bill is $70 million. But a major safety recall may cost $1 billion or more. According to Advocates for Highway and Auto Safety, unless the bill is altered further, it will lead to "the needless deaths of 200,000 people and injuries to more than 12 million during the six year span of the bill, based on current fatality and injury data."
All states have laws against acts that are negligent and result in serious injuries or deaths. Under those state laws, rental car companies face punitive damages if they deliberately rent unsafe, recalled cars, and their customers or others are injured or killed as a result. The companies also face having to pay compensatory damages, consequential damages, or other sanctions. In addition to those protections, if the Act named for Raechel and Jacquie becomes law, then the National Highway Traffic Safety Administration will be able to crack down on rental car companies who violate the law, and fine them -- without anyone having to suffer economic damages or be injured or killed. NHTSA already has that authority over new car dealers' sales of recalled new cars, and has fined several dealers who were caught violating the law.
A recalled 2001 Honda Civic rental car claimed the life of Jewel Brangman, age 26.
Enactment of Raechel and Jacquie's legislation has been delayed due to opposition from some auto manufacturers and the National Automobile Dealers Association. If Sen. Schumer's bill had been made into law sooner, it could have saved the life of Jewel Brangman, age 26, who died last September from injuries she suffered when the defective Takata air bag in the 2001 Honda Civic she rented from Sunset Car Rentals in San Diego exploded with excessive force, causing metal fragments to slice into her neck. She lost a lot of blood and died soon after the crash.
NBC Los Angeles report on tragic crash that claimed the life of Jewel Brangman, who rented a 2001 Honda Civic that was
recalled because it had a faulty Takata air bag that was prone to exploding and spewing metal fragments at the driver.
Even the CA New Car Dealers Association had to agree that rental car companies
should have to fix safety recalls before renting cars to the public.
See new car dealers' testimony in Sacramento:
NEVER trust that a dealer will have the safety recall repairs performed before selling you a car that is being recalled. Dealers are so eager to make a buck, fast, they are unwilling to delay sales long enough to get the safety recall repairs done -- for FREE.
Plus -- dealers are actively opposing legislation in Washington, DC and in California that would prohibit them from renting, selling, leasing, or loaning unsafe, recalled vehicles to consumers, unless the safety recall repairs have been performed first.
CARS’ tips on how to buy a safe, reliable used car — without having to risk going to a dealer:
Did a dealer sell you an unsafe, recalled car? We want to hear your story. Contact CARS
Buyer Beware! Auto dealers' one-
sided contracts can ruin your life
Even if the car dealer breaks the law, you might not be able to get justice. Forced arbitration clauses hidden in the fine print can keep you tied up for years. The dealer often gets to pick the arbitrator who hears your case. CARS exposed how a dealer abused arbitration, after selling Jon Perz an unsafe car. CARS' video has received over 1.3 million views on YouTube. Jon and his attorney eventually won, but because of forced arbitration, Jon had to wait 8 years for justice:
Think this is outrageous? Call your member of Congress at 202-224-3121, and urge them
to vote for the Arbitration Fairness Act. More about the AFA, now pending before Congress: http://www.fairarbitrationnow.org
Here's what we're doing to bring
more attention to Jon's plight: