LRB-0432/7
PJK&ARG:kjf&amn
2015 - 2016 LEGISLATURE
January 27, 2016 - Introduced by Representatives Barca, Ohnstad, Allen, Kahl,
Kolste, Krug, Sinicki and Subeck, cosponsored by Senators Ringhand and
Wirch. Referred to Committee on Consumer Protection.
AB818,2,2
1An Act to repeal 704.90 (5) (b) 1. b., 704.90 (5) (b) 2. ag. and 704.90 (6) (a) 5. a.;
2to renumber 349.13 (3m) (a) 1. and 704.90 (7);
to consolidate, renumber and
3amend 704.90 (6) (a) 5. (intro.) and b.;
to amend 349.13 (3m) (d), 349.13 (3m)
4(dr) 2., 349.13 (5) (b) 2., 704.90 (1) (e), 704.90 (4b) (a), 704.90 (5) (a), 704.90 (5)
5(b) (intro.), 704.90 (5) (b) 1. (intro.), 704.90 (5) (b) 2. (intro.), 704.90 (5) (b) 2. d.,
6704.90 (6) (a) 2., 704.90 (6) (a) 4., 704.90 (6) (a) 6., 704.90 (6) (a) 7. (intro.), 704.90
7(6) (a) 7. c., 704.90 (6) (a) 8., 704.90 (6) (b) and 704.90 (7) (title); and
to create
8349.13 (3m) (a) 1g., 1n., 1r. and 3., 349.13 (3m) (bm), 628.02 (1) (b) 10., 632.976,
9704.90 (1) (i), 704.90 (1) (j), 704.90 (5) (c), 704.90 (5r), 704.90 (6) (am) and 704.90
10(7) (b) of the statutes;
relating to: enforcing liens on personal property stored
11in self-service storage facilities and units, towing a vehicle of a lessee in default,
1authorizing the sale of self-service storage limited lines insurance, and
2providing a penalty.
Analysis by the Legislative Reference Bureau
This bill makes various changes to the law regulating the leasing of space for
storage of personal property in self-service storage facilities (facility) and
self-service storage units (unit), primarily to the requirements for the notice and sale
of the personal property that is being stored in a facility or unit when the lessee
defaults in the payment of rent; provides that a vehicle being stored in a facility or
unit may be towed at the owner's expense if the lessee defaults in the payment of rent
and sets out the default and notice requirements that apply; and authorizes, and
establishes requirements for, the sale by a facility operator (operator) of self-service
storage insurance covering personal property being stored in a unit or at a facility.
Disposal of property stored in self-service storage units and facilities
Current law regulates the leasing of space for storage of personal property in
facilities and units, including requiring written rental agreements; creating liens,
for rent and other charges, on personal property stored in the facility; limiting late
rental fees; and establishing procedures for the disposition of personal property in
the event that a person defaults in the payment of rent or leaves the personal
property behind at the termination of the rental agreement. These procedures
include requirements for providing notice and conducting the sale and, if the
personal property is worth less than $100, allow the operator to donate to a
charitable organization, or dispose of, the personal property. This bill makes various
changes to the laws regulating self-service storage, and the disposal, of personal
property.
Currently, an operator may charge a late fee each month that a lessee does not
pay the rent within five weekdays after the rent is due. The bill changes the time
for when a late fee may be charged to five days, rather than weekdays, after the rent
is due.
Currently, an operator must give two notices to the lessee that he or she is in
default in the payment of rent or that rent has not been paid for personal property
left behind after the termination of the rental agreement. The first notice must be
sent by regular mail and must contain various types of information, including that
the lessee has failed to pay rent for storage of the personal property and a general
description of the personal property that is subject to the lien for payment of rent.
The second notice must be sent by certified mail or first class mail with a certificate
of mailing. This notice must contain a statement that there is a lien on the personal
property being stored in the leased space and a general description of the property
subject to the lien. The bill provides that the first notice must be sent by regular mail
or electronic mail and that the second notice must be sent by electronic mail or any
method of mailing offered by the U.S. Postal Service or other commercial mail
delivery service that provides evidence of mailing. The notices may be sent by
electronic mail only if there is confirmation of receipt. The bill also removes the
requirement that the notices contain a general description of the personal property
that is being stored and that is subject to the lien for payment of rent, but requires
the operator to make available to the lessee, upon the lessee's request, either
photographs or a video of the personal property.
Under current law, if the lessee does not redeem the property after notice by
paying the rent and any other charges that the lessee owes, the operator may sell the
property after advertising the sale once per week for two consecutive weeks in a
newspaper of general circulation where the facility is located. The bill changes the
advertising requirement to one publication in a newspaper of general circulation and
removes the requirement that the advertisement contain a general description of the
property to be sold. The bill also clarifies that in order for the lessee to redeem his
or her personal property, he or she must make full payment of all rent and other
charges owed.
Under current law, if the personal property is sold, it must be sold at a public
sale with three or more bidders, offered for sale privately to at least three persons
who deal with the type of property that is for sale, or sold in another manner that is
commercially reasonable. The sale must take place at the facility or the unit of the
facility where the property is located or at the nearest suitable place to the place
where the personal property is stored. The bill expressly provides that a
commercially reasonable manner of sale includes sale by means of the Internet, and
provides that, in addition to the physical locations in current law, the sale of the
property may be conducted at an Internet site that is reasonably expected to attract
bidders. Additionally, the bill provides that an operator may postpone for up to 14
days a sale that is advertised to be held at a physical location if the weather is
inclement on the day the sale was advertised to be held. The advertisement for the
new date must indicate the original date, that the sale was postponed, and the reason
for the postponement. At least five days before the sale, the operator must send
notice to the lessee, by regular mail or, if receipt is confirmed, by electronic mail,
stating that the sale was postponed and providing the new date, time, and place of
the sale.
Under current law, if the operator sells the personal property, the sale proceeds
must first be applied to satisfy the lien for the overdue rent and other charges and
then any balance must be delivered to the Secretary of Revenue to be disposed of as
unclaimed property. The bill changes this so that the proceeds first must be applied
to satisfy the lien, then any balance must be returned to the lessee. If the operator
is unable after due diligence to locate the lessee, however, the operator must deliver
the balance to the Secretary of Revenue as under current law.
Towing vehicles stored in self-service storage units and facilities
Under current law, if a vehicle is parked without authorization on private
property, the vehicle may be removed (towed) immediately, at the vehicle owner's
expense and without the owner's permission, if: 1) a citation for illegal parking has
been issued; or 2) the private property is posted with a clearly visible notice that it
is private property and vehicles parked without authorization may be immediately
towed. A vehicle illegally parked on private property may be towed only by a towing
service at the request of the property owner or property owner's agent or of a traffic
officer or parking enforcer. Before the vehicle is towed, the towing service must notify
a local law enforcement agency of the make, model, vehicle identification number,
and registration plate number of the vehicle and the location to which the vehicle will
be towed. The vehicle owner must pay the reasonable charges for towing and, if
applicable, storage of the vehicle, as well as any service fee, not exceeding $35,
imposed by the municipality where the vehicle was parked. However, the towing
service may not collect any towing or storage charges if the towing service failed to
notify law enforcement before towing the vehicle. The towing service may impound
the vehicle until its charges are paid and, if the charges are not paid within 30 days
or arrangements for installment payments are not made, the vehicle is considered
abandoned and may be disposed of as are other abandoned vehicles.
Under this bill, an operator may have a vehicle stored in a unit or facility towed,
at the vehicle owner's expense, without the permission of the vehicle owner and
without an illegal parking citation being issued, if: 1) the lessee failed to pay rent
or other charges under a rental agreement for at least seven consecutive days after
the due date; 2) the operator provided to the lessee two notices containing certain
information related to the lessee's default and the second notice was sent after the
lessee had failed to pay rent or other charges for more than 60 consecutive days after
the due date under the rental agreement; and 3) the lessee failed to timely redeem
the vehicle. Provisions of current law relating to the towing of illegally parked
vehicles from private property also apply, including that the vehicle may be towed
only by a towing service at the request of the operator or of a traffic officer or parking
enforcer.
Self-service storage insurance
The bill authorizes, and establishes requirements for, the sale of self-service
storage insurance (insurance) by an operator, or by an employee or representative
of the operator, covering personal property stored in the unit or at the facility. The
operator or employee or representative is not required to hold a certificate of
authority as an insurer or a license as an insurance intermediary to offer or sell the
insurance only if the operator complies with the statutory requirements; the insurer
issuing the insurance supervises, or appoints a supervising entity to supervise, the
administration of the sale of the insurance; the supervising entity, or insurer if no
supervising entity is appointed, maintains a registry of operators and locations at
which operators or employees or representatives may offer or sell the insurance,
which registry must be made available to the commissioner of insurance
(commissioner) upon request; and any operator who is an individual, or any
employee or representative of the operator, who intends to offer or sell insurance
must complete a training program, developed and administered by the insurer or
supervising entity, that provides basic instruction about the insurance.
Under the bill, the insurance is issued to the operator as a group or master
commercial policy, and an individual (customer) who leases a unit or space in a
facility from the operator may purchase coverage under the insurance policy to
protect his or her personal property stored in the unit or at the facility from loss or
damage during the term of the rental agreement for the unit or facility space. The
bill prohibits an operator or employee or representative from advertising or
representing that he or she is an insurance intermediary if he or she does not hold
such a license; provides that an operator may not base an employee's or
representative's compensation primarily on the number of customers who purchase
coverage; requires an operator to remit all moneys collected from customers to the
insurer; and authorizes an insurer to compensate an operator for billing and
collection services.
The bill requires an operator to separately itemize any charge for the insurance
that is not included in the cost of leasing the unit or space, and, if the charge for the
insurance is included in the leasing cost, that must be clearly and conspicuously
disclosed. Additionally, at every location where the insurance is offered to customers,
the operator must make available written materials that provide specific
information, such as the identity of the insurer, the amount of the deductible, the
terms of coverage, how to make a claim, that the coverage may duplicate coverage
under the customer's homeowner's or renter's policy, and, if insurance is required as
a condition of leasing the unit or space, that the customer may satisfy that
requirement by presenting evidence of other comparable insurance coverage. The
bill specifies what happens if the insurer changes the policy terms or the operator or
insurer terminates the policy; under what circumstances an insurer may terminate
a customer's coverage; and the penalties that the commissioner may impose if an
operator or an employee or representative violates any of the new provisions.
For further information see the state fiscal estimate, which will be printed as
an appendix to this bill.
The people of the state of Wisconsin, represented in senate and assembly, do
enact as follows:
AB818,1
1Section
1. 349.13 (3m) (a) 1. of the statutes is renumbered 349.13 (3m) (a) 1w.
AB818,2
2Section
2. 349.13 (3m) (a) 1g., 1n., 1r. and 3. of the statutes are created to read:
AB818,5,33
349.13
(3m) (a) 1g. "Leased space" has the meaning given in s. 704.90 (1) (b).
AB818,5,44
1n. "Lessee" has the meaning given in s. 704.90 (1) (c).
AB818,5,55
1r. "Operator" has the meaning given in s. 704.90 (1) (d).
AB818,5,66
3. "Rental agreement" has the meaning given in s. 704.90 (1) (f).
AB818,3
7Section
3. 349.13 (3m) (bm) of the statutes is created to read:
AB818,6,28
349.13
(3m) (bm) Notwithstanding par. (b), and subject to par. (dr) 1., an
9operator may have a vehicle that is stored in a lessee's leased space removed, at the
1vehicle owner's expense, without the permission of the vehicle owner, regardless of
2whether a citation is issued for illegal parking, if all of the following apply:
AB818,6,43
1. The lessee failed to pay rent or other charges under a rental agreement for
4at least 7 consecutive days after the due date under the rental agreement.
AB818,6,55
2. The operator has provided the notices under s. 704.90 (5) (b).
AB818,6,86
3. Before the operator sent the 2nd notice under s. 704.90 (5) (b) 2., the lessee
7had failed to pay rent or other charges under the rental agreement for more than 60
8consecutive days after the due date under the rental agreement.
AB818,6,109
4. The lessee has failed to redeem the vehicle under s. 704.90 (5) (a) within the
10time specified in the notice under s. 704.90 (5) (b) 2. c.
AB818,4
11Section
4. 349.13 (3m) (d) of the statutes is amended to read:
AB818,6,1612
349.13
(3m) (d) 1. Subject to par. (dr), a vehicle may be removed from private
13property under par. (b) or (c) only by a towing service at the request of the property
14owner or property owner's agent, a traffic officer, or a parking enforcer.
Subject to
15par. (dr), a vehicle may be removed from leased space under par. (bm) only by a towing
16service at the request of the operator, a traffic officer, or a parking enforcer.
AB818,6,2017
2. Before any vehicle is removed under par. (b)
or
to (c) by a towing service, the
18towing service shall notify a local law enforcement agency of the make, model, vehicle
19identification number, and registration plate number of the vehicle and the location
20to which the vehicle will be removed.
AB818,7,621
3. Subject to par. (dr) 2., if a vehicle is removed under par. (b)
or to (c) by a towing
22service, the vehicle owner shall pay the reasonable charges for removal and, if
23applicable, storage of the vehicle, as well as any service fee imposed under par. (dm).
24Subject to par. (dr) 2., if the vehicle was removed at the request of the property owner
25or property owner's agent
or at the request of an operator, these reasonable charges
1shall be paid directly to the towing service, and the towing service may impound the
2vehicle until these charges are paid. If these charges have not been paid in full within
330 days of the vehicle's removal and the vehicle owner has not entered into a written
4agreement with the towing service to pay these reasonable charges in installment
5payments, the vehicle shall be deemed abandoned and may be disposed of as are
6other abandoned vehicles.
AB818,5
7Section
5. 349.13 (3m) (dr) 2. of the statutes is amended to read:
AB818,7,118
349.13
(3m) (dr) 2. A towing service may not collect any charges for the removal
9or storage of an illegally parked vehicle under this subsection
, or a vehicle removed
10under par. (bm), if the towing service has not complied with par. (d) 2. with respect
11to the vehicle.
AB818,6
12Section
6. 349.13 (5) (b) 2. of the statutes is amended to read:
AB818,7,1813
349.13
(5) (b) 2. A person who has custody of a vehicle removed or stored under
14subs. (3) to (4) or otherwise at the request of a law enforcement officer, traffic officer,
15parking enforcer, property owner
, or property owner's agent
, or operator, as defined
16in s. 704.90 (1) (d), shall release the personal property within the vehicle to the owner
17of the vehicle during regular office hours upon presentation by the owner of proper
18identification.
AB818,7
19Section
7. 628.02 (1) (b) 10. of the statutes is created to read:
AB818,7,2220
628.02
(1) (b) 10. An operator, as defined in s. 704.90 (1) (d), or an employee or
21authorized representative of an operator, selling or offering self-service storage
22insurance under s. 632.976.
AB818,8
23Section
8. 632.976 of the statutes is created to read:
AB818,7,24
24632.976 Self-service storage insurance.
(1) Definitions. In this section:
AB818,8,2
1(a) "Customer" means a person who leases a self-service storage unit or space
2at a self-service storage facility under the terms of a rental agreement.
AB818,8,43
(b) "Enrolled customer" means a customer who elects coverage under a
4self-service storage insurance policy issued to an operator.
AB818,8,55
(c) "Leased space" has the meaning given in s. 704.90 (1) (b).
AB818,8,66
(d) "Operator" has the meaning given in s. 704.90 (1) (d).
AB818,8,77
(e) "Personal property" has the meaning given in s. 704.90 (1) (e).
AB818,8,88
(f) "Rental agreement" has the meaning given in s. 704.90 (1) (f).
AB818,8,99
(g) "Self-service storage facility" has the meaning given in s. 704.90 (1) (g).
AB818,8,1310
(h) "Self-service storage insurance" means insurance that provides coverage
11for the loss of, or damage to, personal property contained in a leased space during the
12term of a rental agreement. "Self-service storage insurance" does not include any
13of the following:
AB818,8,1414
1. Homeowner's insurance.
AB818,8,1515
2. Renter's insurance.