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No more free ride?

The state Department of Finance & Administration's recent crackdown on the misuse of dealer tags has new car dealers thinking twice about all those cars they loan to colleges and universities and drivers education programs around the state.

Now that the DF&A wants dealers to register those wheels and pay sales tax on them, which dealers have avoided doing for decades, it seems someone's going to lose their free ride.

DF&A Deputy Commissioner John Theis explained the law explicitly: Dealers tags are for dealers, managers, sales managers or salespersons of the dealership the tag is attached to.

"Anyone who is not one of those named individuals cannot use a dealer plate on a vehicle," Theis said. "Instead they would have a regular passenger plate and register the vehicle they're driving."

And that includes the fleet of cars dealers loan to state college and university officials, many of them in the schools' athletic departments.

Dennis Jungmeyer, president of the Arkansas Automobile Dealers Association, said Arkansas dealers loan 300 to 400 cars to state colleges and universities and an unknown number of cars to high school drivers ed programs. University of Arkansas Football Coach Houston Nutt and his boss, Athletic Director Frank Broyles, are two of more than 50 Fayetteville beneficiaries.

"From the universities' standpoint, those vehicles are considered a contribution and could not be replaced by the university because they don't have the budget to do it," Jungmeyer said. "It's like everybody wins, and it doesn't cost the state any money because the dealers wouldn't be providing them if they had to register them and pay sales taxes."

Jungmeyer also said the AADA hopes the rules can be changed in the next legislative session so that qualified institutions can get temporary licensing at little or no cost. In the meantime, however, the group is advising dealers to pay the sales tax under protest if they're assessed.
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Title Annotation:laws regarding car loans to universities and colleges
Comment:No more free ride?(laws regarding car loans to universities and colleges)
Publication:Arkansas Business
Article Type:Brief Article
Geographic Code:1U7AR
Date:Jul 25, 2005
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