96-131
Response September 27, 1996
Request
XXXXX
I just found another surprise and would like your
involvement. . . .
Re:
Rules R651-213-1, R651-214-1 (Vessels)
Rules R651-403-1, R651-404-1 (Off Highway Vehicles)
These rules backup statutory requirements of Parks
and Rec to "regulate" dealers of OHV and vessels. The regulation is accomplished by
contracting with the Tax Commission to issue dealer registrations.
Much like motor vehicles, dealers of vessels and
OHV, 1) need temporary permits to issue on vehicles while the registrations are
in process; and 2) they have need for the equivalent of dealer plates for
demonstration purposes (called dealer registrations).
As you can see after reading the rules, they've
given the Tax Commission the authority to suspend dealer registrations if
misused. I think XXXXX and the
Commission should be informed about this and let me know if they want us to
hold a hearing and suspend; and if so, where does an appeal from our division
go (to our Commission or to Parks and Rec)?
XXXXX
XXXXX
Internal Advisory Opinion - Tax Commission responsibilities
related to revocations and suspensions of dealer registrations on off-highway
vehicles and vessels.
Dear XXXXX
We
have received your request for guidance regarding the suspension or revocation
of dealer plate equivalents and temporary permits issued to off-highway vehicle
and watercraft dealers. Specifically, you asked who is responsible
for conducting a hearing prior to suspending or revoking dealer registrations
and temporary permits. We find as
follows:
The
Tax Commission’s statutory authority relating to off-highway vehicles and
watercraft vessels is limited. With
regard to off-highway vehicles, for instance, the Motor Vehicle Section of the
Tax Commission has authority to issue, suspend or revoke vehicle
registrations.
, but no statutory authority pertaining to dealer
plate equivalents or temporary permits.
See §§41-22-3 and 41-1a-110 (3) Utah Code Ann. The statutes governing
boats and other vessels do not impose any registration responsibilities on the
Motor Vehicle Section. However, the
statutes allow the Division of Parks
and Recreation (“DPR”) to authorize another entity to act as its agent to
issue, suspend or revoke registrations.
Our
involvement in these dealer registration processes are not statutory. They stem from rules issued by DPR naming
the Motor Vehicle Section as its agent rather than. Although you only asked about the hearing process, we are
concerned about the underlying authority of the Tax Commission to be involved
in these processes at all. We address
that issue first.
The
legislature placed the responsibility for issuing and controlling off-highway
dealer registrations and temporary permits on the Board of Parks and
Recreation. §41-22-5 Utah Code Ann. The Board, in turn, adopted Rules R651-403-1
and R651-404-1 and assigned those
responsibilities to the Motor Vehicles Section. The Tax Commission, of course, only has that
authority which is assigned it by the constitution and the legislature. SEMECO Indus. Inc. v. Auditing Div.,
849 P.2d 1167, 1172 (Utah 1993).
Likewise, the Board of Parks and Recreation has only the rule-making
authority granted by the legislature. Crowther v. Nationwide Mut. Ins. Co.,
762 P.2d 1119, 1122 (Utah Ct. App. 1988).
It may not adopt rules which
abridge, enlarge, extend or modify the statute creating the right or imposing
the duty. IML Freight, Inc. v.
Ottosen, 538 P.2d 296, 297 (Utah 1975).
We believe that DPR may not use its rulemaking authority to delegate
away its responsibilities without legislative authority to do so. Therefore, we
believe that rules R651-403-1 and R651-404-1 are invalid insofar as they impose
DPR duties on the Motor Vehicle Section.
The
statutes governing watercraft present a different situation because they allow
DPR to delegate some of its duties to a party acting in an agency
capacity. §§73-18-7 and 78-18.7.3 Utah Code Ann. Again, the division adopted rules which
assign the Motor Vehicle Section to act as its agent. Utah Admin. Rules
R651-213-1 and R651-214-1. Although DPR
has clear authority to enter into an agency agreement with the Tax Commission,
it may not do so unilaterally by adopting a rule. The Tax Commission must agree to the agency relationship. Arguably, we have agreed (or acquiesced) to
the relationship by merely performing the duties outlined in the rules. However, the Commission is not sure if the
Motor Vehicle Section willingly consented to the agency relationship, or if it
performs the duties because it believes it is compelled to do so under the
rules. The rules alone are not
sufficient to impose duties on the Motor Vehicle Section, and this is a good
time to give full consideration to the agency relationship that seems to exist.
Having
stated that the Motor Vehicle Section is not bound to act as the agent of the
Parks and Recreation, we acknowledge that perhaps such a relationship serves
the best interests of the public. We
suggest, therefore, that you explore this issue with DPR. If you determine that the Motor Vehicle
Section is the proper entity to handle dealer registrations, your next step is
to work with DPR to establish clear authority to do so. Let us suggest how to do this. DPR should approach the legislature for statutory
amendments to the off-highway statutes.
If the legislature assigns dealer and temporary registration duties to
the Motor Vehicle Section, we will have clear authority to act on these
matters. At minimum, we believe the
legislature must grant DPR explicit authority to delegate its authority to an
agent as it has done in the case of watercraft registrations.
Once
authority is established, we would like you to cooperate with DPR to work out
the details of the agency relationship.
In addition to writing rules to clearly delineate each agency’s
responsibilities, we would like you to consider whether the rules should be
supported with written agreements.
We
understand that DPR has approached you with two requests to revoke dealer registrations. The revocations must be preceded by a hearing. Because the Tax Commission has no authority
to suspend or revoke off-highway dealer registrations and temporary permits and
because we have not yet agreed to hear any cases on behalf of DPR, we decline
to hear the cases that are pending. We
suggest that DPR hear all cases of this type until such time as that
responsibility is transferred to the Tax Commission by way of legislation or
agreement. Of course, the Motor Vehicle
Section will respond to any order issued by DPR following the DPR hearings.
If
the hearing function is eventually placed with the Tax Commission, the hearings
will be handled by the Appeals Unit.
However, the Motor Vehicle Section must issue a statutory notice to the
dealer. The notice must set out the
claim for suspension or revocation and outline the dealer’s right to
appeal. DPR, as the party requesting
agency action on these cases, will be joined as a party to the appeal.
Please
keep us informed as you work with DPR to resolve these issues.
For
the Commission,
Alice
Shearer,
Commissioner