Committee adopts amendment and advances bill allowing lease termination after PennDOT medical license recall

The House Transportation Committee voted to report House Bill 205, as amended, which would allow a vehicle lessee to terminate a motor vehicle lease without paying an early-termination penalty if PennDOT has recalled the lessee’s driving privileges for medical reasons and the lessee follows specified notice and return procedures.

The bill matters because lessees who lose the ability to drive for medical reasons can face significant financial burdens if required to pay remaining lease balances or termination fees for vehicles they can no longer use. Supporters said the bill would protect such Pennsylvanians from those costs while preserving certain lessor rights.

Kyle, a committee staff member, summarized the bill for members, saying the measure applies only to leases executed with a Pennsylvania billing address on or after the law’s effective date and does not apply when another household member regularly uses the vehicle. The staff summary also said a lessee seeking termination must provide the lessor a copy of the PennDOT notice of medical license recall and return the vehicle to the lessor.

Representative Gina McNeil, the prime sponsor, told the committee losing the ability to drive “can be a challenging experience for families” and said the bill would allow individuals to terminate leases early when “a medical professional determines they are unfit to drive safely.” McNeil said the bill would require the medical determination to be reported to PennDOT and that individuals returning a vehicle “will only be responsible for any damage incurred.”

Chairman Nielsen offered Amendment A00765, which the prime sponsor agreed to and which the committee adopted. As summarized by committee staff, the amendment requires the lessee to notify the lessor within 45 days of the PennDOT recall, requires the recall notice be provided prior to grounding or returning the vehicle, excludes lessees in default or with a cosigner, and allows lessors to collect charges unrelated to early termination (for example, excess wear, excess mileage, disposition fees, fines and taxes). Nielsen said the changes were based on feedback from the Pennsylvania Bankers Association and the Pennsylvania Chamber of Business and Industry.

Representative Hamm recorded a negative vote on the bill; the chair announced the committee vote as 25–1 in favor and that the bill will be reported out of committee.

The bill now moves to the full House for further consideration under the legislative process.