DENVER — Colorado Gov. John Hickenlooper signed into law Wednesday a Senate bill that better empowers dealers when negotiating their franchise agreements with manufacturers.

Introduced in March, Senate Bill 265 clarifies that a number of dealer-friendly statutes passed since 2009, including one that limits manufacturer-mandated renovations to no more than every seven years, can be applied to franchise agreements that took effect prior to the passage of those laws. Other laws impacted by SB 265 include one that gives dealers the first right of refusal when a manufacturer closes a store in bankruptcy but later wishes to open a franchise in the same market.

“We are glad that Gov. Hicklenlooper signed our bill into law,” Colo. Sen. David Balmer (R-Centennial), one of the bill’s sponsors, told F&I and Showroom in an e-mail. “Now Colorado will lead the country in protecting the free-enterprise rights of auto dealers and their car-buying customers.”   

Colorado Automobile Dealers Association (CADA) President Tim Jackson has maintained confidence the governor would sign the bill given the strong support it received from state legislators. “For us and this bill, it was not a matter of if the governor would sign it, it was just a matter of when,” he said.

The bill was signed late yesterday afternoon as the CADA board of directors was providing a legislative update. “I told the board that we expected the bill to be signed at any time,” he said. “I had no more than stated that when the phone rang and our chief capitol lobbyist informed us the bill had just been signed.”

Jackson explained that the need for the legislation was based on multiple instances when manufacturers ignored dealer-friendly laws passed by the state legislature in the last four years.

“Even though the number of times might not be too many, the amount of value and risk of the costs, it can be significant,” Jackson said. “If it’s just one time on one termination protection, then for that dealer, it’s a monumental issue because it means whether or not they keep their franchise.”

A representative from Gov. Hickenlooper’s office said he would not issue a statement regarding the bill.

 - Stephanie Forshee