New England Automotive Report July 2014

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MASSACHUSETTS

BUILDING THE SUCCESS OF THE AUTO REPAIR INDUSTRY

ALSO IN THIS ISSUE

President Obama Honors

Worcester Tech Grads

ADALB Advisory Ruling:

The Industry Speaks

2 July 2014 New England Automotive Report

New England Automotive Report July 2014 5

FEATURES 22 | The ADALBs Video or Digital AdvisoryRuling: The Industrys Response

28 | From Washington to Worcester: PresidentObama Honors MA Vocational Students

36 | 2014 AASP/MA Golf Outing Highlights

46 | Rejuvenating the Regions: An AASP/MAChapter Meeting Recap

DEPARTMENTSPRESIDENTS MESSAGE7 | Time for Action at the ADALBby Paul Hendricks

IN THE AREA10 | AASP/MA Shop Hosts Child Passenger Safety Seat Checkpoint

LEGAL PERSPECTIVE16 | Personal Inspectionby James A. Castleman, Esq.

NATIONAL NEWS26 | Shops Legal Options Explored at Illinois Symposium51 | Montanez Offers Airbag Testimony at RI Senate Hearing

LOCAL NEWS43 | Putnam VOC Hosts Advisory Committee Appreciation Dinner

MARK MY WORDS54 | Credit Cards and Your Bottom Lineby Mark Giammalvo

CONTENTS

8 | A MESSAGE FROM THE EXECUTIVE DIRECTOR13 | AASP/MA MIDSTATE CHAPTER BBQ NOTICE18 | AASP/MA ANNUAL CASINO NIGHT NOTICE

19 | AASP/MA SUSTAINING SPONSORS61 | AASP/MA MEMBERSHIP APPLICATION62 | INDEX OF ADVERTISERS

July 2014 Volume 12, No. 7

ALSO THIS ISSUE

36

22



STAFF

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AASP/MA EXECUTIVE COMMITTEEPRESIDENTPaul HendricksVICE PRESIDENTMolly BrodeurSECRETARYGary CloutierACTING TREASURERMolly BrodeurIMMEDIATE PAST PRESIDENTRick Starbard

AASP/MA STATEWIDE DIRECTORSCOLLISION DIVISION DIRECTORAdam IoakimASSOCIATE DIVISION DIRECTORDon Cushing

AASP/MA CHAPTER DIRECTORSN/E CHAPTER COLLISION DIRECTORAlex FalzoneS/E CHAPTER COLLISION DIRECTORKevin GalleraniS/E CHAPTER MECHANICAL DIRECTORMichael PenachoMIDSTATE CHAPTER COLLISION DIRECTORTom RicciWESTERN CHAPTER COLLISION DIRECTORPeter LangoneWESTERN CHAPTER MECHANICAL DIRECTOREd Nalewanski

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MANAGING EDITORAlicia Figurelli ([email protected])

EDITORJoel Gausten ([email protected])

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(800) 991-1995 ([email protected])ART DIRECTOR

Lea Velocci ([email protected])PRODUCTION

Sofia Cabrera ([email protected])

WWW.AASPMA.ORG

AASP/MA EXECUTIVE DIRECTORJillian M. Zywien

Lynch Associates, Inc.10 Liberty Square, 5th Floor Boston, MA 02109

phone: (617) 574-0741 Fax: (617) 695-0173Email: [email protected]

MASSACHUSETTS


New England Automotive Report is published monthly by TGP, Inc., 244 Chestnut Street, Suite 202 Nutley, NJ 07110. Distributed free to qualified recipients; $48 to all others. Additional copies of New Eng-land Automotive Report are available at $5 per copy. Reproduction of any portions of this publication is specifically prohibited without written permission of the publisher. The opinions and ideas appearingin this magazine are not necessarily representations of TGP Inc. or of AASP/MA. Copyright 2014 by Thomas Greco Publishing, Inc. Images: Cover, pg. 5 www.thinkstockphoto.com/Justin Skinner; pg.5, pg. 22 www.thinkstock.com/Jose David Rey Macias; pg. 13 www.thinkstockphoto.com/saiva; pg. 18www.thinkstockphoto.com/Kalawin; ; pg. 54 www.thinkstockphoto.com/George Doyle.

PRESIDENTS MESSAGE

AASP/MAPresident Paul Hendricks isthe owner of Hendricks Auto Body

in Uxbridge, MA. He can be reached at (508) 278-6066.

MASSACHUSETTS


Time for actionat the adalB

For as long as I can remember, there has always beensome sort of controversy at the Auto Damage AppraiserLicensing Board (ADALB). You have no doubt read timeand time again in the pages of this magazine and else-where about complaints from the auto body industrythat have been tabled or rejected, as well as rulings madeby the Board that have left collision repairers scratchingtheir heads. The recent May 20 advisory ruling regardingdigital imaging in appraisals is a perfect example of whatIm talking about. There are presently two collision re-pair industry representatives sitting on the ADALB.These two shop owners know all too well the ramifica-tions of opening the door to allow digital imagery intothe appraisal process. So how did a ruling like this hap-pen?And why isnt the collision repair industry beingrepresented at the ADALB?

As an association representing body shops all overthe Commonwealth, we are tired of being underminedby an entity allegedly in place to help streamline the re-pair process. Instead of working for the auto body indus-try, the ADALB has instead stifled the voice of thecollision repairer through ignoring our complaints, post-poning hearing them or voting against our best interests.If a body shop owner takes the morning off, for example,and travels for several hours to attend an ADALBmeet-ing only to be ushered out 10 minutes in so the Board canadjourn to Executive Session...the efficacy of that Boardshould be called into question. We aim to do just that.

Rest assured that as we move forward, we will beworking closely with the ADALB members to ensurethat our needs are being met, and that we are being rep-resented properly. The ADALB should be working tohelp improve the auto body industry. As of this writing,that is most certainly not happening.

Stay tuned to future issues of New England Automo-tive Report for updates on our progress with the ADALB.In the meantime, this months issue features a ton of in-dustry reactions and opinions regarding the May 20 deci-sion. (See pages 8, 16 and 22.)

And as a final note, if you havent seen video cover-age of the May 20 and June 11 ADALB meetings, I highlysuggest you visit the Members Only section of theAASP/MA website. Its a very interesting watch.

AASP/MAs Legislative Committeeand staff have been working tirelessly overthe past three months on a number of reg-ulatory items relative to the Auto DamageAppraiser Licensing Board (ADALB). The

ADALB met on May 20 for a little over twohours, with Tom McClements the onlyBoard Member not in attendance. Follow-ing the approval of the last meetings min-utes, the Board discussed the next Part II

exam set for June 17. The board brieflydiscussed receiving a letter from an indi-vidual whose prior test results had beenoverturned. Carl Garcia said he would re-view the letter and reach out to the indi-vidual, and based on their discussion,offer a retake of the test.

Next on the agenda was the advisoryruling Dave Krupa and Garcia werecharged with drafting relative to personalinspections being done by photo and/orvideo. Following the presentation of thedraft language, a discussion occurred re-garding the purpose of this advisory rul-ing. The Board agreed it was a short-termchange for clarification and they wouldstill be interested in making changes tothe Personal Inspection section in CMR212. Additionally, ADALB member JoeCoyne suggested the word quality videobe added before digital images in orderto protect the consumer. AASP/MAsconcern, which we raised before theBoard, was in defining the word qual-ity. It was the opinion of the Board thatthis definition would be left up to inter-pretation. The full language of the advi-sory ruling can be found online atwww.mass.gov/ocabr/docs/doi/mvda/mvda-advruling-2014-01.pdf. For furtherdiscussion on the ramifications of this ad-visory ruling, please see page 16 and page22 of this issue.

Following the approval of the advi-sory ruling, there was a lengthy discus-sion on the process of addressing changesto the regulations, which Board counselMichael Powers outlined for the Board.The Board agreed that they would needto hold at least one more meeting to dis-cuss and review all their proposedchanges to the regulations, and indicatedthat they would be willing to hear frominterested parties at their next meeting onproposed changes. They suggested theywould be prepared in August or Septem-ber to hold a full public listening session.

The Board recognized a member ofthe audience, Joe Cura (not listed on theagenda), on his request for approval of acompany name change. Cura teaches anappraisal course and assured the Boardthe curriculum would not change, just hiscompany name. Coyne recused himself,as he and Cura do business together.


A MESSAGE FROM THE EXECUTIVE DIRECTOR

adalB Meetings yield advisory ruling on digital images in appraisals, Conflict of interest verbiage

The last item on the agenda were four complaints presentedto the Board by DOI counsel. Chairman Cox suggested he hadno issue with discussing the complaints publicly; Krupa, how-ever, said their previous procedure was to review the claim ini-tially in executive session. Counsel Powers mentioned thatCoyne must excuse himself from the first claim, as it relates tohis company. The Board then adjourned into Executive sessionat 10:22am.

The next meeting of the ADALB took place on Wednesday,June 11. Following the approval of the minutes, McClementsapologized for missing last months Board meeting and notedthat the Boards vote on the Advisory Ruling was unanimousfor those present at last months meeting.

Next, the Board took up the issue McClements addressedon April 29 relative to appraisals versus estimates. In Mc-Clements opinion, the body shop appraiser is the individualwho knows the damage the best. Garcia restated that point, bysaying he writes appraisals rather than estimates in his shop.Krupa asserted that if a licensed appraiser at the shop writes anappraisal, it is considered an appraisal. The word estimate isused to circumvent the conflict of interest clause. Chairman Coxcautioned against removing the conflict of interest language, asit would encourage steering. Krupa agreed with that statementand added further that, if you are a Di-rect Repair shop writing an appraisal forthe consumer, youre also writing on be-half of the insurance company; that is adirect conflict. Consumer protection is ofutmost importance, he said, and steeringis happening every day. Chairman Coxcountered with the question of how theBoard would know steering was anissue without complaints. Krupa fur-thered that the quality of repairs is beingaffected if you send consumers to ahandful of DRP shops. Following this discussion, the Board ul-timately decided to place this item on the agenda for their pub-lic listening session, which they have asserted will be scheduledsometime in September. The Board asked Counsel Powers forlanguage on the conflict of interest clause and some input fromthe Commissioner on this issue.

The much-discussed issue of raising the threshold of ap-praisals from $1,500 to $4,000 was next on the Boards agenda.Chairman Cox asserted that the Board was in consensus on in-creasing the number. Several Board members raised concernwith increasing the amount, including Coyne, McClements andGarcia. Following a brief discussion, it was clear three out of thefour Board members would not seek an increase and would likethe amount to remain the same. The Chairman added this itemto the listening session agenda.

There were four complaints before the Board; three weredismissed following last months meeting and were reported assuch at the June meeting. The fourth complaint, which was filedby AASP/MA, did not receive a full vote of the Board becauseof McClements May 20 absence. AASP/MA advocated for thecomplaint to be addressed during the public portion of the meet-ing; however, the Board agreed to reconvene on this issue in Ex-ecutive session.

Before the close of the meeting, AASP/MA asked to berecognized by the Board relative to the issues being brought tothe future listening session. Our concern was that three of theitems previously agreed to be discussed at the public listeningsession were removed from the Boards agenda. AASP/MA ad-vocated strongly to have these items back on the public listeningsession agenda, and were successful in doing so.*

Before adjourning, the Board scheduled their next meetingfor Wednesday, August 6 at 9:30am.

Members, I cannot stress enough how important it is towatch the video coverage of these meetings and participate inthese conversations. Thank you to the AASP/MA Board mem-bers who were able to attend these important meetings. We ap-preciate your time and support.

Over the last couple of months, theassociation has been working closelywith the Commonwealth AutomobileReinsurers (CAR), who has agreed to aninterim change of their PerformanceStandards on some language changes.The language we were able to agree onwould eliminate what some appraisersuse to suppress the Labor Rate. We haveone more step in the Committee processbefore final approval from the Division

of Insurance, and we look forward to presenting the final ap-proval to our members in the very near future. Please look toyour newsletter, future issues of New England Automotive Reportand the AASP/MA website for this exciting change.

Luckily, the rain held out for AASP/MAs recent Golf Out-ing on Thursday, June 12 and a great time was had by all! Thankyou to all of our sponsors and members who made this yearsgolf outing a success. Our deepest appreciation to Andrea Ker-shaw and Greg Rusnak of Enterprise Rent-A-Car, our Tourna-ment Sponsor, who made this amazing event possible. For fullcoverage of this years Golf Outing, please turn to page 36.

Sincerely,

Jillian ZywienAASP/MAExecutive Director


AASP/MAExecutive DirectorJillian Zywien has been a

senior account executive atLynch Associates for over six

years. She can be reached at(617) 574-0741 or via email at

[email protected].

*To view video of the May 20 and June 11 ADALB meetings, please visit the Members Only section of the AASP/MA website at www.aaspma.org.

aaSp/Mas concern on the adalBs ruling approving quality photo and/or video for appraisals was in defining the word quality. it was the opinion of the Board that this definition would be left up to interpretation.

Photos, clockwise from left:Hopkinton Patrolman Stephen Buckley inspects a child safety seat; Body & PaintCenter owner Tom Ricci; Hudson PatrolmanWendy Durkin joins area resident KimMedeiros and Medeiros' children Marlyana(left) and Nathan during Body & Paint Center's Child Passenger Safety Seat Checkpoint. Photos courtesy of Body & Paint Center.

On May 10, AASP/MA member shop Body & PaintCenter (Hudson) opened their doors for a very specialevent to promote the safety of young ones in their com-munity. During a special Child Passenger Safety SeatCheckpoint held by the business in conjunction with theHudson Police Department and the MassachusettsChild Passenger Safety Program, vehicle owners were

invited to visit the shop and have their boosterand child car seats inspected by state-certifiedtechnicians. In cases where the seats were ex-pired or no longer fit, drivers were providedwith new ones free of charge to better ensurepassenger safety. These seats were providedthrough a grant by the Executive Office ofPublic Safety and Securitys Highway SafetyDivision. The special event attracted participa-tion from members of the Hudson Police De-partment, Hopkinton Police Department,Leominster Auxiliary Police and Westminster


aaSp/Ma Shop hosts Child passenger Safety Seat Checkpoint

IN THE AREA

New England Automotive Report July 2014 11MASSACHUSETTSBUILDING THE SUCCESS OF THE AUTO REPAIR INDUSTRY

Police Department. Dozens of driversfrom Hudson, Worcester, Maynard,Clinton and Newburyport took ad-vantage of the Checkpoint.

After seeing a similar Child Pas-senger Safety Seat Checkpoint held inthe area, Body & Paint Center ownerTom Ricci contacted the Hudson Po-lice to inquire about setting up anevent at his business. The shops largeindoor area allowed for a number ofcars to be brought in from the rainand be inspected. Ricci was amazedby the great response from area vehi-cle owners.

It just felt like the right thing todo, he says. We wanted to use ourfacility to do something to help thedrivers in our area. What better wayto do that than by promoting safetyfor the children in the cars on ourroads? People were just floored by theevent, especially those who received anew seat.

Wendy Durkin, a Hudson Policepatrolman and certified car seat tech-nician, attended the event and wasequally impressed by the enthusiasmshown throughout the community.

It was very successful for theamount of people we had and howmany seats we actually gave away,she says. Rather than just putting thecar seats in, we had the parents learnhow to do it.

While drivers had their car seatschecked out, their children were en-tertained in a special waiting area atthe shop complete with free coloringbooks printed up by Body & PaintCenter that offered valuable informa-tion on bucking up and other carsafety tips for kids.

A Hudson automotive repair in-stitution since 1979, Body & PaintCenter has been at its present locationon Main Street since 1996. More infor-mation on the business is available athttp://bodyandpaintcenter.com.


LEGAL PERSPECTIVE

The Auto Damage Appraiser Licensing Board issued anAdvisory Ruling on May 20, 2014 that may significantlychange the way auto damage appraisals in Massachusetts willnow be written.

For more than 30 years, the ADALBs regulation has re-quired that when writing an appraisal, [t]he appraiser shallpersonally inspect the damaged motor vehicle and shall relyprimarily on that personal inspection in making the ap-praisal. After seemingly making it clear that personal in-spection means actually being in the physical presence of thevehicle, the regulation continues: As part of the inspection,the appraiser shall alSo photograph each of the damagedareas. (Emphasis added.) Yet, the ADALB decided on May 20that it will now interpret its regulation so that an appraisalconducted by a licensed appraiser via review of quality videoor digital images with documentation meets the requirementsfor personal inspection.

Where did such an interpretation come from? Does itmake sense? Does the ADALB even have the authority tomake such an interpretation? And will this be good for the col-lision repair industry in Massachusetts?

Where did it come from?I suppose the idea that digital images could substitute for

in-person visual inspection is probably a concept that has be-come gradually accepted over the past several decades. Whenthe ADALB regulations were first issued in 1981, there wereno devices (at least not affordable ones) that could capture dig-ital images of any kind, never mind quality images. Back then,state of the art referred to a Polaroid camera that could pro-duce grainy images on messy, chemically-treated paper - afterabout a minute of waiting for things to magically appear. Vehi-cle colors in the pictures were only vaguely similar to the ac-tual paint on the car, and only major damage could beconfirmed. It was often impossible to tell the difference be-tween a scratch on the car and a scratch on the photo paperthe picture was printed on.

Once taken, the only way to transmit these pictures to an-other location was to put them in the mail through the USPostal Service or to hand deliver them. In 1981, fax machineshad not yet become prevalent (not that a fax would provide agood image even today), and no one had heard of the Internetor email.

Today, however, the least expensive of cell phones cancapture highly accurate quality images, showing the minutestof damage in accurate color and incredible detail. For a fewdollars more, a camera or advanced cell phone can be pur-chased that reproduces images with precision that would have

required unthinkably expensive and extraordinarily sensitiveprofessional equipment back in the 80s. Ten-year-old kids arewalking around today with cell phones in their pockets thatgive them the ability to take pictures that only professionalphotographers used to be able to create. And nowadays, thedigital images can be instantaneously transmitted to almostany location in the world.

What really prompted the ADALB to act, however, wasprobably the Massachusetts Division of Insurances approvalof a MetLife Direct Payment Plan a couple years ago, whichspecifically provided that MetLifes in-house appraisers couldrely on electronically transmitted digital photos taken by theirreferral repair shops to assess damage. While the Divisionsapproval of MetLifes Plan seems to have occurred minusprior consultation with the ADALB, once the Plan was ap-proved, the Division appeared to push the ADALB to acceptthe concept. And the ADALB chose not to challenge MetLifeor the Division on the concept.

Once the ADALB accepted the MetLife procedure, it was-nt much of a stretch for the Board to extend it to all appraisersand all insurers. In fact, perhaps it was the only fair thing todo.

Can the ADALB Do This?Under the ADALBs governing statute, the Board is specif-

ically given the authority to issue regulations. And under gen-erally accepted legal principles, agencies are given the right tointerpret their own regulations. Further, a section of the Mas-sachusetts Administrative Procedures Act gives governmentagencies the right to issue advisory rulings that interprettheir regulations: On request of any interested person, anagency may make an advisory ruling with respect to the appli-cability to any person, property or state of facts of any statuteor regulation enforced or administered by that agency.

The issuance of advisory rulings does not require thesame procedural safeguards that issuance of regulations does.No hearings have to be held, no input has to be sought and noparticular procedures have to be followed.

On the other hand, unlike regulations, advisory rulings donot carry the full force and effect of law. In other words,while advisory rulings give guidance as to how an administra-tive agency would act if faced with a certain set of facts, theyare only opinions and do not necessarily have to be followedby the agency when faced with a real life dispute that it mustrule on.

Additionally, case law holds that advisory rulings cannotcontradict the requirements of a statute or an existing regula-tion. Statutes are the law of the state, enacted by the legislature

perSonal inSpeCTionby James A. Castleman, Esq.

and agency regulations cannot violate them. And once anagency issues a regulation, its stuck with what the regulationsays. The agency cannot alter it without holding hearings andamending or repealing the existing regulation. An advisoryruling cannot change an existing regulation; it can only inter-pret it.

On its face, it may appear that the recent ADALB advisoryruling may, in fact, violate its existing regulation. After all,doesnt personal inspection mean actual, in person physicalinspection? Perhaps it does, based on the reality that theADALB chose to specifically distinguish photographs frompersonal inspection when it first wrote its regulation.

Additionally, the ADALBs governing statute itself distin-guishes between personal inspection and photographs in de-termining whether an insurer legally may be allowed to obtaincompetitive damage estimates from a second repair shop. Acompetitive estimate cannot be obtained unless a licensed ap-praiser has inspected the vehicle and prepared an itemized es-timate of repairs to be performed. No such competitiveestimates shall be obtained by the use of photographs, tele-phone calls or in any manner other than a personal inspec-tion.

It is quite possible that, if challenged, a court could deter-mine the ADALBs advisory ruling to be an invalid interpreta-

tion of its regulation. Yet, courts do give deference to anagencys interpretation of its own regulation, so such a chal-lenge would not be guaranteed to succeed. At the same time,the ADALB has given its approval to acceptance of digital im-ages instead of in-person viewing, so it would seem fruitlessto challenge the procedure at the ADALB itself. It would seemlikely that appraisers who do utilize the procedure would beprotected from being punished for doing so.

Even further, the ADALB is currently considering amend-ing its existing regulation in several respects, anyway. If itdoes so, then it probably can include changes that incorporatethe concept of the advisory ruling, and it would be likely thatsuch a change would be valid.

Is it good for the collision repair industry?Im not sure that I know the answer to this question.Perhaps utilization of digital images for remote appraisals

will be abused in certain circumstances, allowing for un-scrupulous repair shops and insurance appraisers to falsifydamage and alter what would have been on an in person ap-praisal. Further, it may make it more difficult to negotiate withan insurance appraiser in a meaningful way, since the ap-praiser is not at the repair shop and does not have to negotiatewith the shop appraiser face to face. Additionally, will it cause

vehicle owners to suffer because of inaccurate appraisals andfailure of accountability?

If done properly, however, perhaps utilization of digitalimages with proper documentation will help repair shops byreducing cycle time for vehicle repairs, since the insurance ap-praiser will not have to spend the time to physically come tothe shop to view the vehicle, either for an initial or for a sup-plemental appraisal. Though the advisory ruling is new, theconcept had previously been at least partially accepted for thepurposes of expedited supplemental appraisals - a procedureofficially incorporated into the regulation itself after hearingswere held and other procedural safeguards were met. Further,it is my understanding from shops that use expedited ap-praisals that the expedited appraisal experience can be a verypositive one.

What seems clearer is that the ADALBs advisory rulingwill likely have a negative impact on independent appraisers.After all, if insurers can keep their staff appraisers in their of-fices, examining digital images that shops are uploading totheir desktop computers, it would seem that staff appraiserscould handle a lot more volume, meaning that there would bemuch less of a need for independents. Will it mean the end ofthe independent appraisal industry? It will be worth watchingto see what happens.

ConclusionWhether you like it or not, it appears the day has come

when insurance appraisers will no longer have to physicallygo to collision repair shops in order to prepare appraisals ofdamaged vehicles. Its a new concept, and it may take a whileto iron out the wrinkles and make it work right.

But if you are in the auto body repair business in Massa-chusetts, you should prepare yourself for the new world of ap-praisals based on electronically transmitted digital images. Ifyou like the concept - and the idea that it might save you cycletime - maybe you want to consider asking all insurers to writetheir appraisals from digitally transmitted images, since theprocess can no longer be seen as unique to only one insurerand its hand-picked subset of referral shops.


MASSACHUSETTS


Attorney James Castleman is a managing member of Paster, Rice &

Castleman, LLC in Quincy, MA. Hecan be reached at (617) 472-3424 or [email protected].

on its face, it may appear that the recent adalB advisoryruling may, in fact, violate its existing regulation.


Contact AASP/MAat (617) 574-0741 / [email protected] for information on becoming an AASP/MAsponsor!

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FEATURE

The adalBs video or digital advisory ruling: The induSTryS reSponSe

As Told to Joel Gausten

As discussed in this months Legal Perspective on page 16 and Executive Directors Message on page 8, the Massa-chusetts Auto Damage Appraiser Licensing Board (ADALB) issued an advisory ruling on May 20 stating that an ap-praisal conducted by a licensed appraiser via review of quality video or digital images with documentation meetsthe requirements of 212 CMR 2.04(1)(d), which states that the appraiser shall personally inspect the damaged motorvehicle and shall rely primarily on that personal inspection in making that appraisal... Not surprisingly, the advi-sory ruling has sent shockwaves throughout the Commonwealths collision repair community. new england auto-motive report reached out to AASP/MA members for some of their immediate thoughts on the ADALBs decision.

paul hendriCkS (hendricks auto Body, uxbridge, Ma)

We knew it was coming; we just haveto make it work for us. Its too vague theway it is written now. Youre trying to tellme that anybody can just take photos,send them in to the insurance companyand theyre going to write an estimate?What happens if there is a safety issue in-volved in this? What happens if the cus-tomer takes the picture, not realizing thatthe front end of the car is out of whack?The law clearly states that if a vehicle,upon inspection by a licensed appraiser,would not pass a safety or emissions in-spection, we are to remove the sticker.How is that going to be implemented iftheres no physical inspection of that vehi-cle by an appraiser? I think the clarifica-tion should be that a licensed appraisershould view the vehicle, and if an estimateis written in-house, its obviously writtenby a licensed appraiser as well.

From Day One when I got my ap-praisers license, it was always stated thatyou would not appraise a car with aphoto. If I put two cars side by side andtake a picture, the reflection of the othercar bounces into the photos. You cantimagine what that could be made to looklike. I think theres a lot of extra room forfraud. In addition to that, I still feel thatthose ADALB meetings should be movedto a location thats convenient to all.

adaM ioakiM (hogan & van auto Body, Medford, Ma)

We do need to keep up with technol-ogy and the times. With that said, I dontthink the advisory ruling as written bene-fits the consumer or the body shop. I reallyfeel that it only benefits the insurancecompany. Its a cost-saving technique forthem that really does an injustice for theconsumer. There is no way to accuratelyappraise damage via pictures or video. Itleaves out too many items that wouldntshow up in a camera or video. You would-nt be able to feel the damage, or the dentor the scratch to see the extent of whathappened, nor would you be able to seeother items on the vehicle that would beindicators of further damage. It completelytakes away the ability to access the dam-age from a safety standpoint for the cus-tomer.

I think the ADALB trulythinks they are keeping upwith the times, but I dontthink they thought itthrough to the point of howit affects the customers, theirsafety and the ability towrite an accurate appraisal.

JuSTin Forkuo (290 auto Body, worcester, Ma)

Insurance companies are going to dowhat they want to do; theyve been doingit for years. Ive been following theADALB meetings, but not as closely as Imreading the 1963 Consent Decree, which Ibelieve is much stronger. Whether youchoose to accept the photography [ruling]or not, its all a piece of an already-brokenlaw. Its all part of the cost-control processof Direct Repair. You dont have to be well-educated to know that.

If theyre going to pay us off of pho-tos, then we dont need appraisers any-more. I have some of the highest-qualitycameras that you can get, so we dont needany more appraisers in the facility. Arethey just going to pay, or are they justgoing to take the pictures and then some-one in an office is going to dissect themand look for money that they can takeaway from the body shop? Its absurd forsomeone to say they can do an estimate offof photos alone. I have a problem withthem paying me for the repairs I needright now, and they stand right in front ofmy face! Imagine when they get photos.

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MASSACHUSETTS


riCk STarBard (ricks auto Collision, revere, Ma)

I think you need that other set of eyes on the car. Through en-hancements, whether its physical things or software, you can make apicture say as much or as little as you want. I dont agree with the rul-ing, and I dont agree with this consumer picture thing, either. In onerespect, it begins a claim, but as far as generating an appraisal and acheck off of a consumers cell phone picture and making them thinkthat their claim is now settled? That is crazy.

With cars as complex as they are, and the amount of hidden dam-age in an accident, they think that Joe Blow with an iPhone can snap ashot and settle their claim? I think they should come out and see thecar.

Whats going to happen with personal injury cases? Somebodytook a shot, and maybe the shop doesnt want to see the car totaled be-cause they need the work, so they dont write all the damage behindthe bumper. Then somebody has a personal injury suit involved withthat accident, and the insurance company says, No, your injury dam-ages cant be that because the damage to the car was only this. We havethe picture. Theres a host of reasons why this shouldnt be used. Itsnot used for consumer convenience; its for insurer control. Anotherissue with customer photos is that we have a law requiring removal ofinspection stickers. If a customer sends in a photo with safety viola-tions, who is pulling the sticker?

new england automotive report will provideupdates on the ADALBs advisory ruling and itsimplications for the collision repair industry infuture issues. Please stay tuned; this story isonly beginning.

DelGallo notes that several attendees were former Direct Repair shopsthat made the decision to operate as strictly independent businesses.

Theyre seeing more profitability per job, and that just reinforced mythought process that if Im working for the customer, I can actually realizemore profit per job by doing the repair correctly and getting paid for all theprocedures, he offers. More and more shops nationally are getting off theprograms because theyve been drinking the Kool-Aid for so long thattheyre finally getting a bad taste in their mouths. Theyve seen the light.Why do they want to put the customer at risk by doing inferior repairsunder the premise of the insurance company sending them more work? Weall went into business to be independent. How can owners be truly inde-pendent with a slave master telling them to do what they know is wrongwhen they and they alone are liable?

Fellow AASP/MA member Rick Starbard was encouraged by the out-pouring of interest and support offered by the members of the legal profes-sion in attendance.

Its about time that attorneys are finally listening to people in this in-dustry and seeing how much the insurers try to dominate our industrythrough tortious interference, substandard repairs and a failure to pay, heoffers. The fact that they had the Attorney General from Mississippi, theAssistant Attorney General from Louisiana and the former Attorney Gen-eral from Utah all saying the same thing blew my mind.

Montana-based industry representative Janet Chaney (Cave CreekBusiness Development) was also pleased to have made the trip to theAASPI event.

I think it was a blockbuster lineup of speakers, she says. It was thefirst conference of its kind to have Attorneys General and the legal profes-sion involved, and it was good information.

Above all, Starbard feels that the S.A.F.E. Cars event opened the doorto greater collaboration between shops and those with the legal expertise toimprove conditions for body shops throughout the US.

There is something looming on the horizon that will make things bet-ter for this industry, he says. Finally, somebody is listening.

AASP/MA is planning to host a special event with Attorney JohnEaves, Jr. later this summer. Look for more information in an upcomingissue of New England Automotive Report.


NATIONAL NEWS

On May 30 and 31, repair professionals fromaround the country gathered at the RenaissanceSchaumburg Hotel and Convention Center inSchaumburg, IL for legal perspectives on some ofthe industrys biggest issues. During the two-dayeducational symposium (S.A.F.E. Cars - Safe Au-tomobiles for Everyone) hosted by the Alliance ofAutomotive Service Providers of Illinois (AASPI)and open only to collision repairers and industryvendors, attendees were treated to workshops andguest presentations from lawyers and shop own-

ers knowledgeable in how to use the legal systemto address common industry issues. Presenters in-cluded Mississippi attorney John Eaves, Jr., BillByrne (AASPI) and Florida shop owner Ray Gun-der (Gunders Auto Center, Lakeland). The eventalso drew participation from Mississippi AttorneyGeneral Jim Hood, Louisiana Assistant AttorneyGeneral Stacie DeBlieux and three-time Utah At-torney General Mark Shurtleff.

AASP/MA member Rob DelGallo, owner ofFactory Collision in Weymouth, took time out ofhis shops busy schedule to attend the Symposiumand was greatly impressed by what the event hadto offer.

It was enlightening because there were hun-dreds of shops there in the same room as lawyersand Attorneys General, he says. They were all intune with the Consent Decree of 1963.

Shops legal options explored at illinois Symposium

Former Utah Attorney General Mark Shurtleff addressed attendees of the S.A.F.E. Cars Symposium.

Mississippi AttorneyGeneral Jim Hood offered insight intohow shops could use the legal systemto find relief to industry concerns.Photos courtesy ofJanet Chaney

MASSACHUSETTS



FEATURE

As anyone who reads New England Automotive Report al-ready knows, auto body and mechanical vocational studentsare the true heroes of this industry. But on June 11, the worldwas made aware of just how special these hardworking futureprofessionals truly are.

At their graduation ceremony at the DCU Center inWorcester, the Worcester Technical High Schools Class of 2014were treated to a commencement speechby none other than President BarackObama. The President appeared to an ec-static crowd of students, parents, familyand friends to congratulate the school onall that it has accomplished in recentyears and to send the departing class ontheir way in a manner they would neverforget. And New England Automotive Re-port was there.

In his address, President Obama of-fered words of pride and encouragementto the 2014 graduates.

Over the past four years, some ofyou have learned how to take apart an en-gine and put it back together again, heremarked. Some of you have learnedhow to run a restaurant, or build a house,or fix a computer. And all of you are grad-uating today not just with a great education, but with the skillsthat will let you start your careers and skills that will makeAmerica stronger. Together, youre an example of whats pos-sible when we stop just talking about giving young people op-portunity, when we dont just give lip service to helping youcompete in the global economy and we actually start doing it.Thats whats happening right here in Worcester. And thats

why Im here today. I mean, I like all of you, and Im glad to bewith you, but the thing I really want to do is make sure thatwhat weve learned here at this high school we can lift up forthe entire nation. I want the nation to learn from WorcesterTech.

In addition to delivering a rousing speech, PresidentObama made sure to shake the hand of every student who re-

ceived a diploma on the stage at the DCUCenter that afternoon. He even gave a fewhugs along the way. Naturally, the stu-dents and family members in attendancewerent the only ones thrilled by the Presi-dents participation in this years festivi-ties.

It was a really overwhelming experi-ence, offers Worcester Automotive Colli-sion Department Head Steve Stefanik,who saw 11 students from his class gradu-ate and shake hands with PresidentObama. It was great for the kids; this issomething theyre going to remember fora long time. It was just great recognitionfor the school, the administrators, the stu-dents and everybody working hard.

AASP/MA member Justin Forkuo(290 Auto Body, Worcester), who is also

part of Worcester Techs Advisory Committee, brought his fa-ther Peter along to share in the unforgettable experience.

My dad was amazed, he says. It was a surreal experi-ence to go into the DCU Center, sit down and think about thePresident being there. Then he comes out, and its instantsmiles from everyone. Its just exciting!

Forkuo adds that the spirit of the day - as well as the

Photos & Story by Joel Gausten

overwhelming support shown to the graduates - was strongerthan politics.

Whether youre on the left, on the right or in the middle,you have to really tuck all those feelings away and understandthe magnitude of a situation like this, he says. It was reallybig for the kids, and for the City of Worcester in general.

Worcester Technical High School is a 2013 Blue RibbonSchool led by Dr. Sheila Harrity, a National High School Princi-pal of the Year who was recently recognized by the President atthe National Teachers of the Year event on May 1 at the WhiteHouse.

When Dr. Harrity took leadership of the school in 2006, itwas one of the lowest-performing institutions in the state, ex-plained the White House in a prepared statement. Butthrough implementation of reforms that characterize the Presi-dents vision for comprehensive High School Redesign and theprinciples of the Administrations Blueprint for Career andTechnical Education, Worcester has seen significant success.

According to White House figures, Worcester Techs 10thgrade scores on the statewide Massachusetts ComprehensiveAssessment System exam have improved significantly over thepast seven years: 92 percent of students now score as advancedor proficient in English Language (a 240-percent increase),while 84 percent of students now score as advanced or profi-cient in mathematics (an increase of 140 percent).

Worcester Tech is a model of what can happen when acommunity decides to invest in the success of its young peo-ple, offered the White House. The President is determined tocontinue making progress for Americas students by replicatingthe transformation seen in Worcester in high schools and com-munities across the country.

More information on Worcester Technical High School isavailable at www.techhigh.us.

MASSACHUSETTS


Clockwise from facing page, top left: A crowd of thousands attends the

2014 Worcester TechnicalHighSchool commencement;

graduating students receive acommencement speech from none

other than President Barack Obama;AASP/MA member Justin Forkuo

poses with his father, Peter, following the

unforgettable ceremony.


2014 AASP/MA GOLF OUTING

HIGHLIGHTS

1 2

3 4

65

1. (l to r): roth wennerstrom (Best Chevrolet), Bob Moran (Best Chevrolet) and Tom ricci (Body & paint Center)2. (l to r): darlene andrade (wolpert insurance), leonardo rodriguez (lynn Tech), andy ioakim (hogan & vanauto Body) and rick Starbard (ricks auto Collision)3. (l to r): Jim Zele (Sherwin-williams), Mike Johnson (Sherwin-williams) and david elie (acme Body & paint)4. (l to r): Steve williams, don Macritchie, Bob donnelly and Jeff williams of Middlesex auto Body5. Taking a bite out of victory! The First place team from Cape auto Body savors the moment. (l to r): Tom Mayer,Sean Condon, kevin gallerani and lucas rhodes6. (l to r): Bill Spellane (Spellane auto Body), ken parker (long automotive), Tom Schube (long automotive), dave ovalles (providence auto Body)

THE PLAYERS:


JUNE 12, 2014 CHARTER OAK COUNTRY CLUB HUDSON, MAPHOTOS BY JOEL GAUSTEN

7. (l to r): Bino dos Santos, Michael dzengeleski, Brian duffy and rich Cote of lkQ8. derek Brady from the Third place Foresight insurance team9. (l to r): Mike Furmanick, Shawn Flanders, willie Camacho and Mike ambrosino of Fuller auto Body

10. The Second place team. (l to r): rich Connor (FinishMaster), al Brodeur (al Brodeurs South Street), BobBarnes (al Brodeurs South Street) and dennis Seaver (FinishMaster)11. (l to r): aaSp/Ma president paul hendricks (hendricks auto Body), ed nalewanski (eds auto Body), garyCloutier (Cloots auto Body) and peter langone (langonet auto Body)12. The team from Tournament Sponsor enterprise rent-a-Car. (l to r): greg rusnak, andrea kershaw, Seth royand Steve pacios

78

9 10

11 12


Tournament Sponsor: Enterprise Rent-A-Car

Hole In One Sponsors: LKQ Keystone, Long Automotive Group

Raffle Sponsor: Sherwin-Williams

Prize Sponsor: Bald Hill Dodge/Chrysler/Jeep/Kia

Breakfast Sponsor: Langonet, Inc.

Lunch Sponsors: Best Chevrolet, Gonnello SEO

Longest Drive Sponsor: Lynch Associates, Inc.

Closest to the Pin Sponsor: Quirk Auto Dealers

Hole Sponsors:Admiral Fasteners; Al Brodeurs SouthStreet; Albert Kemperle, Inc.; BASF; AutoBody Builders, Inc.; Bernardi Auto Group;Body and Paint Center of Hudson; BoutiettesAuto Body; Cape Auto Body & Service; Colonial Ford-Plymouth; Don Kennett, Inc.;Eds Auto Body & Repair, Inc.; FinishMaster;Greco Publishing; Hendricks Auto Body;Hogan and Van Auto Body; Ira Toyota/Scionof Danvers; Jaffarian Automotive Group; Linders, Inc.; Marlborough Nissan; McGee Toyota; Mercedes-Benz of Natick; Montague-Brown Co., Inc.; Paster, Rice, & CastlemanLLC; PPG Industries; Rainbow Auto Paint &Body Supplies; Tasca Automotive Group;West Springfield Auto Parts, Inc.

AASP/MA GOLF OUTING HIGHLIGHTS

AASP/MA THANKS ALL THE SPONSORS OF

THIS YEARS TOURNAMENT!

First Place Team (score of 62)Kevin Gallerani, Sean Condon,Lucas Rhodes, Tom Mayer

Second Place Team (score of 66)Dennis Seaver, Bob Barnes, Al

Brodeur, Rich Connor

Third Place Team (score of 68)Donald Choi, Derek Brady

Last Place TeamEd Nalewanski, Paul Hendricks,Gary Cloutier, Peter Langone

CONGRATULATIONS TO OUR WINNERS (AND LOSERS)

Clockwise from top right:Longest Drive winner MikeAmbrosino (Fuller AutoBody); Closest to the Pinwinner Sean Condon (CapeAuto Body); the last placeteam, taking their defeat instride; and Alex Falzone(Guys Auto Body), whoseraffle tickets paid off with abig win!


MASSACHUSETTS


LOCAL NEWS

On May 28, the Automotive Collision Repair Technol-ogy Department at the Roger L. Putnam Vocational-Techni-cal Academy in Springfield held their second annualAdvisory Committee Appreciation Dinner. The event drewmore than 90 students, vendors, educators and Committeemembers in an effort to foster stronger relationships be-tween tomorrows repair professionals and the companiesthat will employ them. The fun-filled evening includedmusic by DJ Eddie Levy, a slew of special raffle prizes do-nated by Advisory Board vendors (including a big-screenTV donated by LKQ/Keystone) and BBQ food prepared byAASP/MA members Gary Cloutier (Cloots Auto Body,Springfield) and Craig Gridley (Larrys Auto Body, Ludlow).Attendees included various Advisory Committee membersand representatives from West Springfield Auto Parts, Ax-alta, I-CAR, 3M, UTI and several area collision repair shops.The evening event also drew participation from instructorsfrom other vocational schools including Montachusett Re-gional, Pathfinder Regional and Franklin County Technical.

Putnam Automotive Collision Repair Technology In-structor John Kennedy was pleased to see so many membersof the industry take part in this unique event.

It was something different, he says. It gives themembers something to talk about. We asked them to invite afriend or colleague from the industry to the nextmeeting...The common goal is to work towards improvingthe collision repair industry, and keep working together sothat we ensure that the kids will have employment opportu-nities.

The Advisory Committee Appreciation Dinner also in-cluded a product showcase by representatives from PRIMAWelders and a special presentation on the Career Path toSuccess, a special team-building initiative that encouragesstudents to work together to develop problem-solving, criti-cal thinking and leadership skills that they will utilize in em-ployment and lifelong learning.

More information on the Roger L. Putnam Vocational-Technical Academy is available at www.putnamacademy.com.

putnam voc hosts advisory Committee appreciation dinner

Students and industry members gathered for Putnam Vocational TechnicalAcademys Advisory Committee Appreciation Dinner on May 28. Photosby John Kennedy and Ray Lapite.

FEATURE

These are very busy times for aaSp/Ma.In addition to recently hosting the AASP/MA Golf Outing

on June 12 (see page 36), the association has seen a surge in ac-tivities in recent weeks on the chapter level. Below is a recap ofthe recent events and presentations that kept AASP/MA mem-bers active and informed as spring turned into summer.

Collision CamaraderieOn May 20, the AASP/MA Western Chapter held its first

meeting of 2014 at the Slainte Restaurant in Holyoke. Drawinga full house of shops and other industry personnel from thearea, the gathering emphasized the importance of education both in supporting tomorrows technicians and getting currentpros up to speed on aluminum repair.

First, the chapter was pleased to donate funds toPathfinder Regional High School (Palmer) in support of twostudents, David Rouisse and Joseph Wyngowski, who recentlywon the Massachusetts SkillsUSA competitions for CollisionRepair and Refinishing, respectively. This donation helps off-set the cost of travel for Rouisse and Wyngowski to attend theSkillsUSA National Leadership & Skills Conference in KansasCity, MO.

When we heard that [instructor] Craig Sankey fromPathfinder Regional High School had SkillsUSA finalists andneeded resources, the Western Chapter was more than happyto donate, offers Western Chapter member Ed Nalewanski(Eds Auto Body, Easthampton). It is so important to supportthe vocational schools. As everyone knows, these students arethe future of our industry - but as everyone also knows, itsvery difficult to find good talent in this industry. Sadly, be-cause the Labor Rate has been suppressed for so long, fewerand fewer students are enrolled in the auto body curriculum,and that is going to be a huge problem in the very near future.

In addition, Kevin Lombard of Lombard Equipment inMendon (www.lombardequipmentinc.com) allowed shopowners the opportunity to participate in a live demonstrationon dent pulling aluminum.

Shop owners wanted to meet Kevin Lombard and see ademo, Nalewanski says. Many commented that they wereglad they attended and that Kevin and his assistant, Michelle,did an outstanding job.

Nalewanski and fellow Western Chapter member MikeBoucher (Custom Auto Body, East Longmeadow) also gave asummary of the recent NORTHEAST Automotive ServicesShow in Secaucus, NJ and encouraged all shop owners to at-tend next year. Bald Hill Dodge/Chrysler/Jeep/Kia, BaliseMotors and Lombard Equipment also donated door prizes forthe event.

AASP/MA Western Chapter Acting President Dan Lam-ontagne (White Lightning Auto Body, Williamsburg) creditsthe meetings success to the Chapters longstanding reputationfor offering a sense of community to its members.

All of us out here in the Western Chapter just all enjoythe camaraderie, he says. Well all in the same business, butwere really not competitors. We try to help each other out asmuch as we can to stay afloat.

Its a great group of people, and we truly care about oneanother, adds Nalewanski. Its not unusual for one shop tocall another and ask for a suggestion on how to do a particularrepair or to get a reference on a specific vendor.

In other news, the Western Chapter has announced Octo-ber 3 as the date of its Annual Clambake at the Polish Ameri-can Club in Feeding Hills. More information on the event willbe featured in next months New England Automotive Report.

Making p&M work for youIn response to requests from shops in the area for

AASP/MA to host meetings, the associations MidState Chap-ter moved the location of its June 3 meeting from the Double-Tree in Westborough to the Edward V. Coakley Four WindsRestaurant at the Greater Lawrence Technical School in An-dover. This change resulted in a slew of new attendees, manyof whom traveled down from New Hampshire to take part inthe festivities. Introducing the speakers at the start of themeeting, AASP/MA Vice President Molly Brodeur (AlBrodeurs Auto Body, Marlboro) noted that the meeting (orga-nized with assistance from Bob Levy of Don Kennette, Inc.)was the direct result of feedback from the collision repair in-dustry.

Its always been the philosophy of the association thatyou bring education to where your people want it, she said.

The main topic of conversation throughout the eveningwas how collision repair shops can realize greater P&M profitsthrough the use of industry accounting programs. Guestspeaker Ed Rachwal of Designer Office Systems, Inc. providedan overview of how shops can use the Mitchell RMC (RefinishMaterials Calculator) to identify additional charges and makemore profit on the jobs that come through the door.

Historically, the Northeast and specifically New Eng-land lag behind the national average, he said. One way to

Photo, this page: The Western Chapter meeting in full force. (Photo by Mike Boucher.) Facing page, above:Bob Collins of Wreck Check Assessments: Without a measurement of quality, price means nothing. Below:Ed Rachwal of Designer Office Systems, Inc. discusses the Mitchell RMC program at AASP/MAs June 3 MidStateChapter meeting.

rejuvenating the regions: an aaSp/Ma Chapter Meeting recapBy Joel Gausten


help get paid properly is to use [a Paint& Materials] calculator and make sureyoure getting paid what you should.

According to the presentation, if ashop repairs an average of 40 cars permonth, and the average differential inmaterials that a shop gets reimbursedfor is $50, that business will increase itsP&M reimbursement by $2,000 a monthby utilizing a Mitchell product that costs$36 a month.

Rachwels seminar was followed bya special Accounting 101 presentationby AASP/MA member Tom Ricci (Body& Paint Center, Hudson), who offered aninside look into how shops can seegreater profits by incorporating paintand materials cost analysis into theirdaily business and by following a for-mula of sales minus costs equals grossprofit dollars.

The benchmark in the industryacross the country is $40 for gross profiton paint and materials, he said. If youuse a refinishing materials calculator, Ican tell you right now that seven out of10 insurance companies if not eight outof 10 are going to accept [yourcharges].

The meeting concluded with a legalpresentation by Massachusetts attorneyJames Castleman, who provided an up-date on regulatory issues concerning the

collision repair industry, including theADALBs recent advisory ruling on digi-tal imaging in the estimating process.(See Castlemans feature on page 16 formore information.)

weeding out the hacks In the world of auto body repair,

cheaper never means better. On June 17at the Holiday Inn in Taunton, theAASP/MA South East Chapter hostedan eye-opening discussion on post-re-pair inspections and Diminished Valueappraisals led by Bob Collins of WreckCheck Assessments (www.wreckCheckBoston.com). As the head of a company

providing consultation and assistance oncollision-damaged vehicles before, dur-ing and after repairs, Collins has seenhis fair share of poor work from both re-ferral and independent shops. Accord-ing to him, 46 percent of the vehicles hiscompany has inspected have had safetydefects, including structural damagethat wasnt repaired. Additionally, hesays that 42 percent of the post-repairvehicles he has encountered displayedevidence of fraud in one form or an-other, including billing the customer forsomething the shop didnt do.


continued on pg. 57

On June 5,noted industrywriter and educatorLarry Montanez(P&L Consultants)appeared before theRhode Island Sen-ate Committee onthe Judiciary as anexpert witness onbehalf of the AutoBody Association ofRhode Island(ABARI) to offerprofessional com-ments and opinions on current bills re-lated to the auto body industry.

One bill in particular, Senate Bill2833, aims to prohibit insurance com-panies from requiring the use of usedor remanufactured airbags and/orsuspension parts when vehicle repairsare made by an auto body shop. An-dreas Heiss, a government affair man-ager for LKQ Corporation, appearedbefore the Committee in opposition tothe bill, stating that shops that per-form airbag removal are subject tostrong guidelines to ensure consumersafety.

There are very strict federalsafety standards for removing theseairbags, he said. The shops that dothat have to be certified in a certainway, and theyre trained to removethese airbags in a certain way.

Calling Montanez the only expertIve heard tonight come before us,Senator Stephen R. Archambault (D-District 22) later asked the repairer ifsuch standards actually existed.

Theres no federal standard onremoving an airbag out of a vehicle;Id like to see one if one exists,replied Montanez. There is a federalstandard on what EDRs [event datarecorders] actually have to record which is black box-like technology...

But theres no standard on taking anairbag in or out.

Senate Deputy Minority LeaderDawson Hodgson (R-District 35)praised ABARI for offering Mon-tanezs technical knowledge and pro-viding greater insight into the issues

addressed at thehearing.

The technicalexpertise thatABARI brings to thetable every year atthese hearings, andthe professionalismthat you are repre-senting your indus-try with, is impress-ive, he said. Youshould be veryproud of that.

Complete videoof the hearing (including Montanezsextensive testimony) is available forfree streaming at http://ricaptv.discov-ervideo.com/embedviews/vod?c=all&w=640&h=480&s=1#.


NATIONAL NEWS

Montanez offers airbag Testimony at ri Senate hearing

Larry Montanez (far right) offered expert testimony to a RISenate Committee on behalf of theAuto Body Association of Rhode Island (ABARI).

MASSACHUSETTS



If youve watched your favorite nightly news channelor read any of the major newspapers lately, you mayhave seen an article about a recent lawsuit against thebig banks and credit card companies. As a result of thislawsuit, businesses that accept credit cards as a form ofpayment may finally see some relief, due to a reductionin future fees charged as well as the possibility of future feecollection from consumers.

Not to be confused with the debit card regulationsbrought about by the Durbin Act of 2011, this latest newsevent involving MasterCard, Visa and other banks shouldbring some new relief to merchants that are taking majorcredit cards as forms of payment.

Several law firms representing numerous large retailstores like Kroger, Walgreens and others have won a settle-ment (pending judge approval) claiming that MasterCard,Visa and some major banks were violating antitrust laws byagreeing to set specific merchant credit card swipe fees andother charges. In the settlement, MasterCard and Visa willsoon lower rates to provide immediate relief to merchants thataccept credit cards. They will also finally allow merchants tocollect fees from consumers that they are charged when creditcards are used. (Prior to this settlement, credit card merchantscould not bill customers for the fees they are charged by thebank and credit card company for using the credit card. How-ever, merchants could offer a discount for customers usingother forms of payment like cash and checks).

If you recall the Durbin Act (sometimes referred to as theDurbin Final Rules), the Feds made banks cap the maxi-mum fees charged when a debit card is used. Prior to Durbin,credit card companies were routinely charging the same usagefees for a debit card and a regular (non-debit) credit card.However, debit cards draw the consumers own funds andthey are much more secure from a fraud standpoint, since aPersonal Identification Number (PIN) is needed during thetransaction. The Durbin Act was touted as a remedy to mer-chants for some of the high fees being charged to them by thebanks.

Here at the shop, we have many customers who pay fortheir service with a credit or debit card. I dont know aboutyou, but every time I look at our banks monthly bank settle-ment statement, my head spins going through the various feeswe are charged just for allowing customers the convenience ofusing this type of payment. There are swipe fees just forreading the card as well as a percentage fee of the invoiceamount for the card itself. That is always confusing; someMasterCard and Visa cards are keyed to take 1.8 percent out ofour invoice total; others (the corporate or flyer mile cards)take close to 3 percent of the invoice total. Then there are batchfees and settlement fees. Quite frankly, its very confusing andcostly, but its always been a necessary expense weve had toendure; some customers just cant afford to pay cash in this

tight economy.A few years back, when we left our old credit card mer-

chant provider and switched to our current bank, the newbank supplied us with a new credit/debit card reader terminaland promised us lower fees than we had been paying in thepast. Well, every month for the past year, we have been inun-dated with letters from our bank, saying how Visa just wentup on this rate, MasterCard just went up on another rate, ourswipe fee will have to increase and so on. You can imagine ourexcitement in hearing about this latest lawsuits promises tochange the credit card industry and reduce costs for us all asmerchants.

One of the more interesting items I am led to believe inthis lawsuit is that we merchants will finally be able to collectthe fees we pay for each transaction directly from the cus-tomer. Exactly how this will be accomplished seems to still re-main a mystery.

The confusing part is that the rates are all over the place,depending on what type of credit card a customer uses. Wealso dont know what percentage fee is actually charged to usuntil 30 days later, when we get our statement. That beingsaid, if we can now charge the customer for the fee we have topay for them using the credit card, how do we know exactlywhat to charge them at the moment of sale? It would be con-venient if the credit card machine could calculate the fees andallow us the option of adding them to the customers paymentat that moment. I dont think its going to work that way.

In an attempt to put this speculation to rest, I called ourbanks merchant services division to inquire as to when andhow we can collect our fees back from the customer. They didnot know what to say and stated that they were not aware ofthe recent lawsuit (the same one that had made all the majornational news channels and newspapers a few weeks back).They even transferred me to a regional manager, who was also

MARK MY WORDS

Credit Cards and your Bottom line

Could recent legal activity inthe credit card industry bringrelief to merchants takingmajor credit cards as payment?

by Mark Giammalvo

not aware of this recently announced settlement. She did state, however,that when they are officially notified, they will send notification via mail,same as they did when the Durbin Amendment was passed.This bankrepresentative also politely reminded me that it is still a violation of ourcredit card acceptance agreement to charge customers for the fees that arecharged to us for the service.

She noted to me that she had recently been at a Virginia courthouse,where she had observed that the court was charging a fee to offset theirfee to people paying for certain reports/documentation by credit card. Iadded how I had recently noticed at City Hall how our city charges a feefor those residents paying real-estate taxes with a credit or debit card. Itspossible that certain state or municipal agencies are allowed to collect afee to offset the credit card processing costs. She could not say for sure.

It remains to be seen exactly how and when merchants will be able torecoup these costly fees for the convenience of accepting credit cards as aform of payment. There have been some articles online lately stating thatsome merchants may continue to absorb the cost or pass it on in otherways, rather than cause a possible point of contention during the check-out process. Im sure as business owners, we will all be keeping an eyeout for future updates inthe news about this lawsuitand the issue of merchantfee collection and lowerfees.


Mark Giammalvo specializes in driveability

diagnostics at his family business,

Sam Giammalvo's AutoSales & Service, Inc. in

New Bedford, MA. He can be reached at

[email protected] THE SUCCESS OF THE AUTO REPAIR INDUSTRY

MARK MY WORDS

In Collins mind, the increase in poor repairsis directly related to the escalating economic pres-sure forced by the insurance industry on collisionshops to cut or limit repair costs.

The consumers have been trained by the in-surance companies to buy insurance based onprice alone, he says. Nobody ever told themthat with cheap price comes low quality.

To illustrate his point, Collins presented a se-ries of photos demonstrating poor repair work.Common issues included improper welds, brokenheadlamps, paint overspray, no seam sealing anda lack of rust-proofing. Collins believes that theseconditions are the result of a lack of proper educa-tion for technicians and the absence of suitablepayment for professional body shop repair.

If the shops arent making any money,theyre not training their guys, he says.

On a positive note, Collins mentioned thatplenty of opportunities exist for professionalshops interested in doing re-repair work, as disas-sembly, measuring, wheel alignment, storage andother items are all chargeable if a shop is willingto take on fixing someone elses poor workman-ship.

Collins also discussed what he called theSeven Levels of Repair. The top level is a repairthat is considered true pre-loss condition, whilethe second level would be a high-quality, visiblyundetectable repair. The third level (which Collins

continued from pg. 47FEATURE

continued on pg. 62


as a member of the alliance of automotive Service providers of Massachusetts (aaSp/Ma), i will abide by the associations bylaws and code ofethics. i understand that membership in aaSp of Massachusetts is non-transferable, and i must remain current with my dues in order to be a member in good standing. i understand that if i discontinue my membership that i must immediately cease using any association promotions,logos or materials. additionally, i understand that as part of my aaSp of Massachusetts membership, i will receive New England Automotive Report, the official publication of aaSp of Massachusetts, faxes, emails and other mailings.

2014 MEMBERSHIP APPLICATION

BUSINESS INFORMATION:

Mr. Mrs. Ms.Business Representative Name: ____________________________

Business Name ____________________________________________

MEMBERSHIP TYPE

REPAIRER MEMBER (check one)Collision Repair ShopMechanical Repair ShopBoth, Collision & Mechanical Repair ShopsOther Repair Shop

SUPPLIER/ASSOCIATE MEMBER (check one)Auto Paint/Crash Parts/Auto Parts/WholesalerEquipment/Tool SupplierManufacturer/Sales AgentServices (Computers, Software, Vehicle Rental, Other)

LIST OTHER SPECIALTIES ____________________________________

________________________________________________________

What benefits motivated you to join AASP of Massachusetts?

________________________________________________________

PERSONAL INFORMATION:

Name ____________________________________________________

Nickname ________________________________________________

2014 ANNUAL MEMBERSHIP DUES (The AASP membership year is from January to January 2015)

Total Due .................................................................................$395.00NEW! Political Action Committee (PAC)Donation...............$______

Check or CashCredit Card: Visa MasterCard

Card Number: __________________________________________

Expiration Date: ________________________________________

Signature: ______________________________________________

Date: __________________________________________________

*** PLEASE TYPE OR PRINT LEGIBLY ***

10 liberty Square, 5th Floor Boston, Ma 02109(617) 574-0741 | (617) 695-0173 (fax) | [email protected]

For oFFiCe uSe onlyCheck number ______________________________Check date ________________________Check amount ______________________________date Joined ______________________________Member number ______________________next Bill date ______________________________

Street Address ________________________________________________________________________________________________________

Mailing Address ______________________________________________________________________________________________________

Phone Number ( )____________________________________ Fax Number ( ) __________________________________________

E-mail Address ________________________________________ Web Site Address ____________________________________________

Enrolled By (Name and Address) ________________________________________________________________________________________

Street City State Zip

Street City State Zip

Just like good tools and equipment, membership in AASP of Massachusetts is avaluable investment. AASP of Massachusetts works for you through

such outstanding programs as: (1) management and technical training; (2) discount uniform rental; and (3) a wide variety of other business services.

Put AASP of Massachusetts to work for you today. COMPLETE THE MEMBERSHIP APPLICATION AND

RETURN IT WITH PAYMENT TO AASP OF MASSACHUSETTS.

As required by the U.S. Tax Code, AASP of Massachusetts, Inc. informs its members that 75% of the dues paid to the associationare tax deductible. The remaining 25% is allocated to legislative activities and is not tax deductible.

MASSACHUSETTS


American Honda ..............................................30Audi Group ......................................................50Axalta Coating Systems ....................................4Bald Hill Chrysler Jeep Dodge Ram ..............27Balise Wholesale Parts Express ......................44Baystate Chrysler/Jeep/Dodge......................42Bernardi Group............................................32-33Best Chevrolet ................................................IFCBMW Group ................................................48-49BMW/Mini of Warwick ..................................40CCCOne ............................................................59Clay Subaru ......................................................10Colonial Auto Group........................................52Empire Auto Parts ............................................11Enterprise ..........................................................21First Chrysler-Dodge-Jeep-Ram ....................21First Ford............................................................21First Hyundai ....................................................21Ford Group ........................................................56Future Cure..........................................................8Goyettes Inc. Auto Parts ................................11Honda Group ....................................................58Hyundai Group ................................................39Imperial Chrysler-Dodge-Jeep........................12Imperial Ford ....................................................56Infiniti of Norwood ..........................................24IRA Group ....................................................14-15Jaffarian Toyota/Volvo ....................................53Kelly Automotive Group ..............................IBCLinders, Inc. ....................................................47Long Automotive Group ............................OBCMazda Group ....................................................45McLaughlin Chevrolet ....................................57Mopar Group ....................................................12Nissan Group ....................................................25Nissan World of Dartmouth............................41PPG ......................................................................3R.F. DAgostino Insurance Agency ................51Robertsons GMC Truck....................................41Sarat Ford-Lincoln ............................................27Sentry Group ......................................................6Subaru Group ..............................................34-35Tasca Group ......................................................31Toyota Group ....................................................55Toyota of Nashua..............................................62Village Auto Group ..........................................60VW Group..........................................................19Wellesley Toyota/Scion ..................................42

AD INDEX


said was the industry average) is agood repair with minor defects. A level-four repair would be a poor job withmoderate defects and deficiencies,while the fifth level would have majordefects and deficiencies. Level Sixwould be a very poor repair with de-fects so severe that the vehicle is ren-dered unsafe to drive, while vehicles atthe seventh level are so poorly repairedthat it would be cost-prohibitive to

attempt a re-do. Above all, Collins stressed that

there is often a difference betweendoing a job right and doing a job at alow cost.

Without a measurement of quality,price means nothing, he said.

For information on upcomingAASP/MA events, please visitwww.aaspma.org.

FEATURE

MASSACHUSETTS


continued from pg. 57


New England Automotive Report July 2014

Documents

Transcript of New England Automotive Report July 2014