After over 5 years of battles against the rental car industry, auto manufacturers, and the National Automobile Dealers Association, we finally won!!! 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 took effect on June 1, 2016. It is the first major expansion of the National Highway Traffic Safety Administration's authority since the agency was created in 1970.

The new Act prohibits nearly all rental car companies, including many car dealers, from renting, loaning, or selling recalled vehicles until the safety defects have been repaired. Federal law prohibited dealers from selling recalled new vehicles, but there was no similar federal law regarding rentals and loaner cars.

For the first time, the National Highway Traffic Safety Administration 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 free from potentially lethal safety recall defects. Rental car companies are the largest purchasers of new cars in North America. They are also among the largest sellers of used cars.

This means that millions of used cars will also be safer, when they re-enter the used car market. That will directly benefit millions of low and moderate-income consumers and their families, and also make the roads safer for everyone. However, because of 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.

"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, including Secretary Anthony Foxx, was also strongly supportive of passage.

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. For years, the rental car industry vociferously opposed the legislation. But eventually, after years of being pressured by widespread national publicity, popular online petitions, and a challenge mounted by Sen. Boxer, Cally, and CARS, 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 with dealerships in Maryland, Pennsylvania, and Florida, who actively opposed the bill and lobbied against its passage.

CARS was represented in Washington, D.C. by Pamela Gilbert, former Executive Director of the U.S. Consumer Product Safety Commission, who worked closely with CARS President Rosemary Shahan and Cally Houck on developing and implementing the successful strategy, eventually overcoming all the opposition.

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

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.

Read more: LA Times: One mother spent over a decade after her daughters' deaths changing car rental laws
 

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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.

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.

   

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Watch the video: U.S. Rep. Lois Capps: Raechel and Jacqueline Houck Safe Rental Car Act. Dec.3, 2015
 

 
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.

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.

 
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.

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.

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.    
» Consumer, safety, and labor groups, and Cally Houck, mother of Raechel and Jacqueline Houck Oppose Sen. Thune's "rental car roulette" bill and support Sen. McCaskill's amendment to substitute The Raechel and Jacqueline Houck Safe Rental Car Act, S 1173

» American Rental Car Association letter to Senators Thune and Nelson, opposing Sen. Thune's bill S 1732

Read more: Bloomberg: Senate Panel Drops Plan to Allow Rentals of Recalled Vehicles  

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