Debate opens over capping dealer 'doc' fees; sponsor seeks $400 maximum

Representative Howitt asked the Joint Committee on Transportation to give a favorable report to H.3690, legislation that would limit motor vehicle dealer documentation fees to $400 for transactions over $2,500 and impose penalties when dealers disclose or apply unlawful fees.

"Establishing a reasonable fee of $400 for paperwork preparation ensures that individuals are treated fairly by motor vehicle dealers," Representative Howitt said, noting wide variations among states and dealers. He said consumers sometimes encounter what he characterized as excessive fees that can approach or exceed $1,000 and urged the committee to consider a cap to protect buyers of lower‑value vehicles.

Dealers and dealer representatives provided counterpoints. Robert Oganowski and other dealer witnesses explained that documentation fees can reflect legitimate administrative costs and that the amount varies by dealership. Pavel Kaniewski, executive vice president for a dealership association, said dealers should calculate fees as cost recovery and that disclosure rules apply at the point of sale. He noted the range of caps in other states and asked to participate in drafting any limit to avoid unintended consequences.

Committee members including Representative Hawkins and Representative Ramos described consumer anecdotes of sticker prices rising at signing and said they are interested in balancing dealer viability with consumer protection. No formal vote occurred. Several witnesses said they were open to further discussions and requested stakeholder work on a cap that accounts for business differences and disclosure practices.