Concerns facilities used by applicants for new motor vehicle dealer licenses.*

S1423 1R

[First Reprint]

SENATE, No. 1423

STATE OF NEW JERSEY

222nd LEGISLATURE

�

PRE-FILED FOR INTRODUCTION IN THE 2026 SESSION

Sponsored by:

Senator JOSEPH A. LAGANA

District 38 (Bergen)

Senator� ANTHONY M. BUCCO

District 25 (Morris and Passaic)

Co-Sponsored by:

Senators Tiver and Corrado

SYNOPSIS

���� Concerns facilities used by applicants for new motor
vehicle dealer licenses.

CURRENT VERSION OF TEXT

���� As reported by the Senate Budget and Appropriations
Committee on June 28, 2026, with amendments.

��

An Act

concerning new motor vehicle dealer licenses and
amending R.S.39:10-2 and R.S.39:10-19.

����
Be It
Enacted
by the Senate and General Assembly of
the State of New Jersey:

���� 1.��� R.S.39:10-2 is amended
to read as follows:

���� 39:10-2.� As used in this
chapter unless other meaning is clearly apparent from the language or context,
or unless inconsistent with the manifest intention of the Legislature:

���� "Authorized
signatory" means a dealer or leasing dealer and any employee, officer,
director, partner, or other holder of an ownership interest in the licensed
business authorized to execute documents on behalf of the dealer or leasing
dealer, but shall not include any attorney-in-fact who is not an employee,
officer, director, partner, or holder of an ownership interest.

���� "New motor vehicle"
means only a newly manufactured motor vehicle, except a nonconventional type
motor vehicle, and includes all such vehicles propelled otherwise than by
muscular power, and motorcycles, motorized bicycles, trailers and tractors, and
manufactured homes not subject to real property taxation pursuant to P.L.1983,
c.400 (C.54:4-1.2 et
[
seq.
]

al.
),
excepting such vehicles as run only upon rails or tracks and manufactured homes
subject to real property taxation.

���� "Used motor vehicle"
means every motor vehicle and motorized bicycle, except a nonconventional type
motor vehicle, title to, or possession of, which has been transferred from the
person who first acquired it from the manufacturer or dealer, and so used as to
become what is commonly known as "secondhand" within the ordinary
meaning thereof, and includes every motor vehicle and motorized bicycle other
than a "new motor vehicle," a "nonconventional type motor
vehicle
,
" or a manufactured home subject to real property taxation.

���� "Any motor vehicle,"
"every motor vehicle," or similar term, means both new and used motor
vehicles, except a "nonconventional type motor vehicle."

���� "Nonconventional type
motor vehicle" means every vehicle not designed or used primarily for the
transportation of persons or property and only incidentally operated or moved
over a highway, including, but not limited to, ditch-digging apparatus,
well-boring apparatus, road and general purpose construction and maintenance
machinery, asphalt spreaders, bituminous mixers, bucket loaders, ditchers,
leveling graders, finishing machines, motor graders, road rollers, scarifiers,
earth-moving carryalls, scrapers, power shovels, drag lines, self-propelled
cranes, earth-moving equipment, trailers and semitrailers which weigh less than
2,500 pounds, except that no mobile or manufactured home or travel trailer
shall be classified as a nonconventional type motor vehicle, motorized
wheelchairs, motorized lawn mowers, bogies, farm equipment having a factory
shipping weight of less than 1,500 pounds, whether or not motorized, including
farm tractors within said weight limitation, industrial tractors, scooters,
go-carts, gas buggies and golf carts.� The Chief Administrator of the New
Jersey Motor Vehicle Commission shall have power to make, amend
,
and
repeal regulations, not inconsistent with the provisions of this paragraph,
prescribing what further vehicles or types of vehicles, not specified in this
paragraph, shall be included in the category of nonconventional type motor
vehicles.

���� "Motor vehicles which
constitute inventory held for sale" means: new motor vehicles and used
motor vehicles held for the purpose of sale by new motor vehicle dealers which
can be identified by a manufacturer's
[
Vehicle
Identification Number
]

vehicle identification number
(VIN) and have been invoiced to, allocated
to, or reserved by a new motor vehicle dealer licensed to do business in New
Jersey, and such vehicle can be shipped by the manufacturer or distributor
within a reasonable period of time and used motor vehicles held for the purpose
of sale by new or used motor vehicle dealers which can be identified by a
manufacturer's VIN and title papers or right to title is held by the used motor
vehicle dealer.� This term shall exclude motor vehicles held for the purpose of
lease or rental by a person engaged in the motor vehicle leasing or rental
business.

���� "Manufacturer's or
importer's certificate of origin" means the original written instrument or
document required to be executed and delivered by the manufacturer to his agent
or a dealer, or a person purchasing direct from the manufacturer, certifying
the origin of the vehicle.

���� "Certificate of
ownership" means the document issued in conformance with this chapter,
certifying ownership of a motor vehicle, other than manufacturer's or
importer's certificate of origin.

���� "Assignment" means
the execution of a prescribed form transferring ownership of a motor vehicle
from the person named therein to the purchaser.

���� "Contract" means
conditional sale agreement, bailment, lease, chattel mortgage, trust receipt
,

or any other form of security or possession agreement executed prior to January
1, 1963, wherein and whereby possession of a motor vehicle is delivered to the
buyer and title therein is to vest in the buyer at a subsequent time upon the
payment of part or all of the price, or upon the performance of any other
condition or happening of any contingency, or upon the payment of a sum
substantially equivalent to the value of the motor vehicle, by which contract
it is agreed that the buyer is bound to become, or has the option of becoming,
the owner of the motor vehicle upon full compliance with the terms of the
contract.

���� "Abstract" means the
duplicate copy of the original certificate of ownership recording any
encumbrance or upon which the existence of a security interest is noted.

���� "Title papers" means
any instrument or document that is evidence of ownership of a vehicle.

���� "Chief
Administrator" means the Chief Administrator of the New Jersey Motor
Vehicle Commission.

���� "Manufacturer" means
the person who originally manufactured the motor vehicle.

���� "Licensee" means any
person that is licensed to buy, sell or deal in, or lease motor vehicles
pursuant to R.S.39:10-19.

���� "Established place of
business" means a permanent, properly identified location within the State
where the books, records, and files necessary to buy, sell, or deal in motor
vehicles are kept and maintained, including, but not limited to, all documents
required by R.S.39:10-6, title papers, manufacturers' or importers'
certificates of origin, motor vehicle registration records, contracts, security
agreements, all payroll records, including, but not limited to, IRS Form W-2
and IRS Form W-4 records, checkbooks, ledgers for business accounts and trust
accounts, corporate authorities and licenses, dealer plates, ledgers listing
all issued and unissued dealer assignments, and dealer plates.

���� "New motor vehicle
dealer" means
[
the
agent, distributor, or
]

1
the
agent, distributor, or
1

an
authorized dealer of
[
the
manufacturer
]

1
[
a motor
vehicle franchisor, as defined in this section,
]

the manufacturer
1
of
[
the
]

1
[
a
]

the
1
new
motor vehicle who has an established place of business.� A new motor vehicle
dealer shall sell a minimum of four or more new motor vehicles within a
12-month timeframe and may engage in the business of buying, selling, or
dealing in used motor vehicles in this State under the provisions of this
chapter.

����
1
[
�Motor
vehicle franchisor� means a person engaged in the business of manufacturing,
assembling, or distributing new motor vehicles, or importing new motor vehicles
into the United States that were manufactured or assembled in a foreign
country, who, under normal business conditions, manufactures, assembles,
distributes, or imports at least 10 new motor vehicles during a calendar year.
]
1

���� "Used motor vehicle
dealer" means a person engaged in the business of selling, buying
,

or dealing in four or more used motor vehicles per year at an established place
of business, but who is not a licensed new motor vehicle dealer.� A used motor
vehicle dealer shall engage only in the business of buying, selling, or dealing
in used motor vehicles in this State under the provisions of this chapter and
shall not engage in the business of buying, selling, or dealing in new motor
vehicles in this State.

���� "Person" includes
natural persons, firms or copartnerships, corporations, associations, or other
artificial bodies, receivers, trustees, common law or statutory assignees,
executors, administrators, sheriffs, constables, marshals, or other persons in
representative or official capacity, and members, officers, agents, employees,
or other representatives of those hereinbefore enumerated.

���� "Buyer" includes
purchaser, debtor, lessee, bailee, transferee, and any person buying,
attempting to buy, or receiving a motor vehicle subject to a security interest,
lease, bailment or transfer agreement, and their legal successors in interest.

���� "Seller" means
manufacturer, dealer, lessor, bailor, transferor with or without a security
interest, and any other person selling, attempting to sell, or delivering a
motor vehicle, and their legal successors in interest.

���� The terms "sell,"
"sale," "buy," or "purchase" and any form thereof
include absolute or voluntary sales and purchases, agreements to sell and
purchase, bailments, leases, security agreements whereby any motor vehicles are
sold and purchased, or agreed to be sold and purchased, involuntary, statutory
and judicial sales, inheritance, devise, or bequest, gift or any other form or
manner of sale or agreement of sale thereof, or the giving or transferring
possession of a motor vehicle to a person for a permanent use; continued
possession for 60 days or more is to be construed as permanent use.

���� "Online sale" means
buying, selling, or dealing in motor vehicles in this State over the Internet
using electronic means.

���� "Electronic" means
relating to technology having electrical, digital, magnetic, optical,
electromagnetic, or similar capabilities.

���� "Manufacturer's
number" means the original manufacturer's vehicle identification number
die stamped upon the body, or frame, or either or both of them, of a motor
vehicle or the original manufacturer's number die stamped upon the engine or
motor of a motor vehicle.

���� "Purchaser" means a
person who takes possession of a motor vehicle by transfer of ownership, either
for use or resale, except a dealer when
[
he
]

the dealer

takes possession through a certificate of origin.

���� "Debtor" means the
person who owes payment or other performance of the obligation secured by a
security interest in a motor vehicle.

���� "Security interest"
means an interest in a motor vehicle which secures payment or other performance
of an obligation.

���� "Security agreement"
means an agreement which creates or provides for a security interest in a motor
vehicle.

���� "Secured party"
means a lender, seller
,
or other person in whose favor there is a
security interest.

���� "Gross vehicle weight
rating" means the value specified by the manufacturer as the loaded weight
of the single or combination vehicle and, if the manufacturer has not specified
a value for a towed vehicle, means the value specified for the towing vehicle
plus the loaded weight of the towed unit.

(cf:� P.L.2021, c.462, s.1)

���� 2.��� R.S.39:10-19 is amended
to read as follows:

���� 39:10-19.�
a.
� No
person shall engage in the business of buying, selling
,
or dealing in
motor vehicles in this State, nor shall a person engage in activity that would
qualify the person as a leasing dealer, as defined in section 2 of P.L.1994,
c.190 (C.56:12-61), unless:�

����
[
a.
]

(1)
������ the person is a
licensed real estate broker acting as an agent or broker in the sale of mobile
homes without their own motor power other than recreation vehicles
,
as
defined in section 3 of P.L.1990, c.103 (C.39:3-10.11), or manufactured homes
,

as defined in section 3 of P.L.1983, c.400 (C.54:4-1.4); or

����
[
b.
]

(2)
������ the person is
authorized to do so under the provisions of this chapter and P.L.1985, c.361
(C.56:10-26 et seq.).

����
b.
��� The chief
administrator may, upon application in such form as the chief administrator
prescribes, license any proper person as a new motor vehicle dealer, used motor
vehicle dealer
,
or
[
,
a
]

leasing dealer.� A licensed real estate broker shall be entitled to act as an
agent or broker in the sale of a mobile or manufactured home
,
as defined
in
paragraph (1) of
subsection a. of this section
,
without
obtaining a license from the chief administrator.� For the purposes of this
chapter, a "licensed real estate broker" means a real estate broker
licensed by the New Jersey Real Estate Commission pursuant to the provisions of
chapter 15 of Title 45 of the Revised Statutes.� Any sale or transfer of a
mobile or manufactured home, in which a licensed real estate broker acts as a
broker or agent pursuant to this
[
section
]

subsection
,
which sale or transfer is subject to any other requirements of R.S.39:10-1 et
seq., shall comply with all of those requirements.

����
c.
���� No person who
has been convicted of a crime, arising out of fraud or misrepresentation in the
sale, leasing
,
or financing of a motor vehicle, shall be eligible to
receive a license
pursuant to subsection b. of this section
.� For the
purposes of this section, each applicant for a license shall submit to the
chief administrator the applicant's name, address, fingerprints, and written
consent for a criminal history record background check to be performed.� The
chief administrator is hereby authorized to exchange fingerprint data with and
receive criminal history record information from the State Bureau of
Identification in the Division of State Police and the Federal Bureau of
Investigation
,
consistent with applicable State and federal laws, rules,
and regulations, for purposes of facilitating determinations concerning
licensure eligibility.� The applicant shall bear the cost for the criminal
history record background check, including all costs of administering and
processing the check.� The Division of State Police shall promptly notify the
chief administrator in the event a current holder of a license or prospective
applicant, who was the subject of a criminal history record background check
pursuant to this section, is arrested for a crime or offense in this State
after the date the background check was performed.

����
d.
��� Each applicant
for a new motor vehicle dealer license shall at the time such license is issued
have established and maintained, or by that application shall agree to
establish and maintain, within 90 days after the issuance thereof, a place of
business consisting of a permanent building not less than 1,000 square feet in
floor space located in the State of New Jersey to be used principally for the
servicing
[
and
]

or

display of motor vehicles
[
with
such
]

.�
For the purpose of servicing motor vehicles, the applicant�s place of business
shall have
equipment
[
installed
]
therein as
shall be requisite for the servicing of motor vehicles in such manner as to
make
[
them
]

the motor
vehicles
comply with the laws of this State and with any rules and
regulations made by the board governing the equipment, use, and operation of
motor vehicles within the State.�
Each applicant shall have the choice to:�

����
(1)�� utilize the space
attached to the applicant�s place of business for the servicing of motor
vehicles;

����
(2)�� utilize a separate
space on the same property as the applicant�s place of business for the
servicing of motor vehicles; or

����
(3)�� establish an off-site
facility within the relevant market area of the applicant�s

1
[
exiting
]
1

place
of business, as defined by section 1 of P.L.1982, c.156 (C.56:10-16).� The
off-site facility shall be used solely for the servicing of motor vehicles

1
,
shall be located within the State,
1

and shall be subject to the provisions of

1
[
section 1
of
]
1

P.L.1982, c.156 (C.56:10-16 et. seq.).

���� However, a leasing dealer
[
,
]
who is not
engaged in the business of buying, selling, or dealing in motor vehicles in the
State
[
,
]
shall not be
required to maintain a place of business with floor space available for the
servicing or display of motor vehicles or to have an exterior sign at the
lessor's place of business.

����
e.
����
1
[
The chief
administrator shall issue a provisional license upon the substantial completion
of the new motor vehicle dealer license application. �The chief administrator
shall issue a provisional license to an applicant that is in the process of
meeting certain requirements for the issuance of a new motor vehicle dealer
license, including, but not limited to, an applicant who is in the process of obtaining
a franchise agreement or installing a permanent sign pursuant to subsection g.
of this section, provided that the sign has been ordered. �The provisional
license issued pursuant to this subsection shall be valid for a period of 90
days.� The chief administrator may, at the chief administrator�s discretion,
extend an applicant�s provisional license for a one-time additional 90 day period.�
The chief administrator shall not charge an additional fee for the issuance of
a provisional license.

����
f.
]
1

(1)

�Any person who possesses a used motor vehicle dealer license at the time of
enactment of P.L.2021, c.484 shall maintain an established place of business
consisting of a minimum office space of 72 square feet within a permanent,
enclosed building located in the State of New Jersey, in addition to complying
with all other applicable regulations prescribed by the chief administrator.

����
(2)
�� Each applicant
for a used motor vehicle dealer license, or any licensee who relocates its
place of business on or after the effective date of P.L.2021, c.484, shall meet
the requirements for an established place of business for a used motor vehicle
dealer, which shall be established by the chief administrator by regulation
adopted pursuant to the "Administrative Procedure Act," P.L.1968,
c.410 (C.52:14B-1 et seq.).

����
1
[
g.
]

f.
1
���� An
established place of business of a new motor vehicle dealer or a used motor
vehicle dealer shall display an exterior sign permanently affixed to the land
or building, which sign is consistent with local ordinances and has letters
easily readable from the major avenues of traffic.� The sign shall include the
dealer name or trade name, provided such trade name has been previously
disclosed to the chief administrator.

����
1
[
h.
]

g.
1
���� A
license fee of $200 shall be paid by an applicant upon the applicant's initial
application for a license.� The chief administrator may renew an applicant's
license upon application for renewal on a form prescribed by the chief
administrator and accompanied by a renewal fee of $200.� Every license shall
expire 24 months from the date on which it is issued.� The chief administrator
may, at the chief administrator's discretion and for good cause shown, extend
an applicant's license for an additional period not to exceed 12 months from
the date on which it is scheduled to expire.� The chief administrator may, at
the chief administrator's discretion and for good cause shown, issue a license
which shall expire on a date fixed by the chief administrator.� The fee for
licenses with an expiration date fixed by the chief administrator shall be
fixed by the chief administrator in an amount proportionately less or greater
than the fee established herein.

����
1
[
i.
]

h.
1
����� For
the purposes of this section, a leasing dealer or an assignee of a leasing
dealer whose leasing activities are limited to buying motor vehicles for the
purpose of leasing them and selling motor vehicles at the termination of a
lease to the lessee shall not be deemed to be engaged in the business of
buying, selling, or dealing in motor vehicles in this State.�
[
Provided
however, that
]

However,
a leasing dealer who wishes to engage in the business of
buying, selling, or dealing in motor vehicles in this State by selling any
vehicle at the end of the lease term to a consumer other than the lessee, shall
be required to obtain a used car dealer license pursuant to this section.

(cf:� P.L.2021, c.484, s.1)

���� 3.��� This act shall take
effect immediately and shall apply to all initial and renewal new motor vehicle
dealer license applications and to all initial and renewal new motor vehicle
dealer license applications that are currently subject to a pending
administrative proceeding pending before the chief administrator or the Office
of Administrative Law or on appeal thereof.