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HB 1515

Concerning contracting and procurement requirements for behavioral health services in medical assistance programs.

2023-2024 Regular Session Introduced by Emily Alvarado and 21 co-sponsors

ND HB 1515 requires manufacturers to pay franchised dealers fair, rate-based compensation for warranty work (labor, parts, diagnostics) with set timelines and no cost shifting.

Effective date 7/23/2023.
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Bill Summary · HB 1515

HB 1515 — Summary (North Dakota)

AN ACT to amend and reenact section 51‑07‑29 of the North Dakota Century Code, relating to motor vehicle warranty work compensation

Purpose / Intent

HB 1515 clarifies and updates statutory rules governing how motor vehicle manufacturers and distributors must compensate franchised dealers for warranty work. The bill aims to ensure dealers receive reasonable payment for diagnostic time, repair labor, and parts used in warranty, recall, goodwill, and manufacturer‑sponsored warranty‑type work, and to set procedures for establishing pay rates and resolving claims.

Key provisions and changes

  • Scope of compensable work

    • Manufacturers/distributors must include reasonable compensation for diagnostic work, repair service, parts, and labor for manufacturer/distributor‑sponsored, issued, or required items such as predelivery preparation, installation of required accessories, diagnostic work, maintenance programs, extended and certified preowned warranties, service contracts, parts exchange programs, and recall/goodwill/warranty work performed by the dealer.

  • Minimum labor and parts compensation

    • Labor compensation may not be less than the dealer’s average retail labor rate for similar nonwarranty service (see rate calculation below).
    • Parts compensation may not be less than the dealer’s customary average retail markup on those parts.

  • Rate determination process

    • Dealers establish their customary retail parts markup and labor rate by submitting either:
    • 100 sequential nonwarranty customer‑paid repair orders containing warranty‑like parts, or
    • 90 consecutive days of such repair orders (whichever is less), covering repairs performed no more than 180 days before submission.
    • Average labor rate is calculated as total labor sales divided by total labor hours that produced those sales.

  • Exclusions from rate calculations

    • A specific list of work and items may not be included when calculating retail rates, including (but not limited to) manufacturer promotional specials; wholesale parts sales; routine maintenance (fluids, filters); nuts/fasteners without part numbers; tires and tire work; wheel alignments (unless part of mechanical repair); non‑propulsion batteries; accessory installation; repairs caused by collision, vandalism, theft, or misuse; aftermarket parts; and work on vehicles from other line makes.

  • Claim submission and payment timelines

    • Dealers must submit reimbursement claims within 90 days of completion of the service.
    • Manufacturers/distributors must approve or disapprove a claim within 30 days of receipt; a claim not disapproved in writing within 30 days is considered approved.
    • Payment to dealers must occur within 30 days after approval.

  • Manufacturer obligations and restrictions

    • Manufacturers/factory branches/distributors must fully compensate licensed dealers for covered warranty parts, work and labor.
    • They may not shift compliance costs to dealers (e.g., via surcharges or separate charges).
    • Declared average rates are presumed fair and take effect 30 days after manufacturer receipt, subject to limited contest rights (manufacturer may contest rates but the statute limits repeated or expanded grounds for contest).

Who is affected

  • Primary: franchised motor vehicle dealers licensed in North Dakota (service departments and technicians).
  • Secondary: motor vehicle manufacturers and distributors doing business in North Dakota (reimbursement practices and administrative processes).
  • Indirectly: vehicle owners (through service availability and dealer economics).

Procedural / timeline notes

  • Introduced: March 14, 2025.
  • Referred to Transportation Committee; committee substitute and amendments were considered; public hearings held (e.g., April 9 and April 30, 2025).
  • Committee reported the bill favorably as substituted; committee report sent to calendars (May 2025).
  • Status (as provided): filed with Secretary of State on April 11, 2025.

Potential impact

  • Strengthens dealer protections by defining compensation minimums, timelines, and an evidentiary process for establishing retail rates.
  • Limits manufacturers’ ability to reimburse below-dealer retail rates or to impose cost‑recovery surcharges on dealers.
  • Introduces predictable timelines for claim processing and payment, which may reduce disputes and improve cash flow for dealers.
  • May increase administrative/recordkeeping activity for manufacturers and dealers (rate declarations, repair order compilation, claim review), but the statute also constrains dispute processes.

If you want, I can extract and present the bill’s full subsection text, prepare a side‑by‑side comparison with current law, or draft a one‑page briefing tailored for dealers or manufacturers.

Compiled from official sources — confirm details with the bill’s official record.

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