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January 01, 2010

As you know, the 2010 Legislative Session began last week.  This year, in addition to the domestic violence, children exploitation and vulnerable adult legislation I previewed for you last month, we’re also introducing legislation to strengthen consumer protection in Washington, protect private property from eminent domain abuse, and improve access to government.

Protecting private property from eminent domain abuse 

Once again this year, we’re seeking to better protect private property from eminent domain abuse.   Washington’s Community Renewal Law (CRL) allows municipalities to eliminate “blight” using the power of eminent domain.  However, many conclude the definition of “blight” is too broad and overly vague, putting landowners at risk.  Reforming Washington’s Community Renewal Law would prevent it from serving as a vehicle by which private property may be taken from one party and transferred to another private party for economic development purposes.  A separate bill we have offered would define “public use” under the state’s eminent domain statute to exclude “economic development”.

Prior to the 2007 legislative session, my office announced we would convene an Eminent Domain Task Force to review existing laws and identify the changes needed to eliminate abuses. This session, on behalf of the Task Force, we are requesting legislation prohibiting the exercise of eminent domain for economic development.  We’ve requested and supported other legislation to curb abuses in the 2007 and 2008 sessions.

Here are a few recent editorials supporting our efforts:

Capping “Found Money” Fees 

Our first Consumer Protection bill aims to protect families who have lost their homes in tax foreclosure from further victimization by individuals seeking to take the remaining sales proceeds through “Surplus Fund” scams. 

When property is sold due to tax foreclosure, unpaid taxes are deducted along with foreclosure fees from the sale price.  Any money left over rightfully belongs to the original owner.  Unfortunately, there are firms that contact owners of foreclosure properties offering to obtain the surplus money in exchange for a hefty percentage of the surplus funds.   A typical scenario occurs when a county sells vacant land due to non-payment of taxes.

Sometimes, these firms contact the property owners before the county does, and some are not aware that they can apply for free to receive their proceeds.  They may also not know that by using finder firms, they will ultimately receive less money than they are entitled to collect.  Such “found money” investors sometimes also use the relationships established through these transactions to target other assets.

Since nationwide warnings have been issued about these “Surplus Funds Scams,” we are asking the Legislature to protect Washington consumers by capping any fee for obtaining money from a tax sale at 5 percent of the amount recovered, and allowing victims and the state to use the Consumer Protection Act to prevent “finder firms” from charging higher fees.

Lemon Law Fix 

Currently, Washington’s Lemon Law does not require used car dealers to disclose whether a vehicle was ever bought back from a manufacturer under a Lemon Law program.   It does, however, require “new motor vehicle dealers” to disclose if a car was reacquired under another state’s “lemon” buyback law. 

In reviewing pending cases, we learned that some used car dealers who did not previously have access to these vehicle are now obtaining re-acquired “lemon” vehicles at auctions and re-selling these vehicles without disclosing the “lemon” status to consumers. Serious safety defects, corrections of defects, and whether a vehicle has a repurchase history are all mandated disclosures and should extend to both new and used car dealers.

We’re now requesting legislation to extend “lemon” disclosure requirements to used vehicle dealers.  Our proposed changes would also provide remedies for dealers and consumers who didn’t receive the appropriate disclosures when they purchased a manufacturer-reacquired “lemon” vehicle.

Enforcing the Public Records Act 

Last but not least, we propose creating an administrative process to resolve public records disputes.  Citizens who are denied access to public records and public meetings have no choice other than to go to court, and lawsuits are costly and time-consuming, many taking years to resolve.  This is simply not an option for many citizens.  In addition, state agencies and local governments face a logjam of citizen complaints, costly litigation, and uncertainty regarding potential liability.  

To address growing concerns among governments and the public, the Attorney General's Office and the Auditor's Office created an Open Government Task Force comprised of state and local elected officials, citizens and representatives of organizations who have worked extensively on open government issues.

The Task Force held two study sessions and recommended creating an administrative procedure to resolve disputes regarding the Public Records Act (PRA) and the Open Public Meetings Act (OPMA).  This would simply require two administrative law judges who could be based in the existing Office of Administrative Hearings, and who would be charged with reviewing and ruling on submitted disputes within 30 days of receiving them. They also would provide guidance in the form of rulemakings and advisory opinions, plus training and materials for government agencies and the public.

Based on these recommendations, we’ve teamed with the State Auditor to jointly request legislation that would create this process and function, without creating an expensive new bureaucracy.  The Governor, many legislators, and open government advocates have endorsed our proposal, which will be heard in the legislature this week. 

Looking Ahead

Although we are facing another difficult session this year, the Attorney General’s Office will continue its commitment to improving community safety, protecting consumers and ensuring citizens have open access to government.  

More information on our entire 2010 AGO Request Legislation Package can be found on our website.   Also throughout the session, we will be posting updates, including hearing dates, on Facebook and Twitter.  Look for the hash tag AGOWALEG.

Rob McKenna
Attorney General

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