Legislative Analysis
Phone: (517) 373-8080
MOTOR VEHICLE REPAIR FACILITIES
http://www.house.mi.gov/hfa
Senate Bill 867 (S-2) as reported Analysis available at
Sponsor: Sen. John Cherry http://www.legislature.mi.gov
House Committee: Regulatory Reform
Senate Committee: Regulatory Affairs
Complete to 12-13-24
SUMMARY:
Senate Bill 867 would amend the Motor Vehicle Service and Repair Act to allow motor vehicle
repair facilities to register a single, auxiliary facility under the same registration, modify
registration fees for motor vehicle repair facilities, and make other changes.
Auxiliary facilities
Currently, the act requires motor vehicle repair facility owners to annually register with the
Department of State (SOS).
The bill would allow owners of these facilities to also be approved for a single, auxiliary facility
under the same registration and registration number as the primary facility. To be approved,
the owner would have to apply to SOS, in a format prescribed by the secretary of state, with
written verification from the appropriate municipal governing body or zoning authority that
the auxiliary facility meets all applicable municipal and zoning requirements.
Upon receiving the application, SOS would review the compliance history of the primary
registered facility and could deny the application or revoke its approval if the primary facility
has any of the following:
• Two or more unresolved violations involving customer parts retention.
• Two or more unresolved violations for failing to maintain records.
• An unresolved violation for hindering or obstructing a general compliance inspection
or a consumer complaint inspection.
Auxiliary facilities would have to meet all of the following:
• Be located within a one-mile radius of the primary motor vehicle repair facility.
• Serve as an extension of the primary facility.
• Mirror the primary facility’s hours of operation, types of vehicles serviced, and repairs
performed.
• Rely on the established place of business of the primary facility for all in-person
customer interactions including customer drop-off and pick-up of vehicles, payment,
invoice generation, and other documents shared with a customer.
• Not perform any repairs that are not approved, directed, or initiated by and through the
primary facility.
Auxiliary facilities would not need any of the following:
• A registration certificate with a separate registration number from the facility with
which the auxiliary facility shares a registration.
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 • An exterior sign that identifies the business.
• Any customer instrument, form, contract, written statement, or other document
required under the act that is distinct from the instruments, forms, contracts, written
statements, or other documents used by the primary facility.
• A consumer information sign.
• A notice of parts return sign.
Records
The bill would require that records for auxiliary facilities be kept in the same manner as
required for other facilities, but would require that these records be stored at the primary facility
with which the auxiliary facility shares its registration.
Other provisions
Currently, the act requires that a certified specialty or master mechanic display their current
certificate at the facility they are employed or engaged to perform repairs. The bill would
specify that they are not required to display this certificate at an auxiliary facility.
In addition, the act currently requires that a person owning multiple motor vehicle repair
facilities in Michigan clearly indicate the location of and person in charge of each facility on
their registration application. The bill would specify that information for auxiliary facilities
need not be included under this provision.
The bill would provide that auxiliary facilities must be open to inspection, including periodic
unannounced inspections, by SOS and other law enforcement officials during regular business
hours, as is required for other repair facilities under the act.
Application and registration requirements and fees
Currently, the act requires that owners of motor vehicle repair facilities to provide various
information to SOS along with their application form annually.
The bill would add that, for applicants applying on or after July 1, 2025, the information
submitted must include the location of the applicant’s established place of business in
Michigan, along with written verification from the appropriate municipal governing body or
zoning authority that states that the place of business meets all applicable municipal and zoning
requirements.
The bill would also add that the registration application must include any auxiliary facilities
that will share the same registration and registration number as the applicant.
In addition, the act would modify the existing requirements as follows:
• Require the principal occupation or business for the past five years for each person that
owns at least 25% of the facility, increased from the current 10%.
• Provide that if the applicant’s range gross revenue received from repairs, as currently
required, does not exceed $300,000, the applicant would also need to provide proof of
gross revenue upon request from SOS.
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 Fee modifications
The bill would make several changes to the fees paid by motor vehicle repair facilities.
First, the bill would provide that the fees paid by these facilities are nonrefundable.
In addition, the bill would change the current registration fee structure, which is based on gross
annual revenue, as shown in the table below.
Current Registration Fee Structure
Annual Gross Revenue Fee
Under $5,000 $25
$5,001 to $15,000 $50
$15,001 to $25,000 $75
$25,001 to $40,000 $100
$40,001 to $60,000, and each $20,000 $125 (plus $25 for each $20,000 increment)
increment to $340,000
Over $340,000 $500
Proposed Registration Fee Structure
Annual Gross Revenue Fee
Under $50,000 $100
$50,001 to $100,000 $200
$100,001 to $200,000 $300
$200,001 to $300,000 $400
Over $300,000 $500
The bill would also increase the certification examination fee from $6 to $18 and require that
$12 of each fee be deposited into the Mechanic Certification Examination Fund described
below. The other $6 would still go into the general fund.
Multi-year registration
The bill would allow the owner of a motor vehicle repair facility with a gross revenue greater
than $300,000 to renew the facility’s registration for between one and four years. The
registration fee would be the applicable annual fee multiplied by the number of years of the
registration.
Mechanic Certification Examination Fund
The bill would create the Mechanic Certification Examination Fund in the state treasury. The
state treasurer would direct the investment of the fund and deposit any interest and earnings
into the fund. SOS would be the administrator of the fund for audit purposes.
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 SOS would, upon appropriation, expend money from the fund only for one or more of the
following purposes:
• To develop and update the content of the mechanic certification examination.
• To administer the mechanic certification examination.
Other changes
The bill would add that if the address of a motor vehicle repair facility changed, the facility
must submit written verification from the appropriate municipal governing body or zoning
authority that states that the established place of business and, if applicable, any auxiliary
facility meet all applicable municipal and zoning requirements.
The act currently requires that SOS be notified if a motor vehicle repair facility is a corporation
and 10% or more of the corporation’s stock is sold or transferred. The bill would increase this
threshold 25% or more of the stock.
MCL 257.1302 et. seq.
BRIEF DISCUSSION:
According to committee testimony, recent changes, such as new technology and an increased
willingness by consumer to repair broken vehicles, has increased the burden on repair facilities.
The bill would allow them to handle this burden by authorizing the use of auxiliary facilities.
In addition, supporters argue in favor of the increased exam fee, stating that it has been decades
since the fee was adjusted.
FISCAL IMPACT:
Senate Bill 867 would result in a marginal annual increase in revenue to the state general fund
and generate additional revenue to be deposited into a new state restricted fund for use by the
Department of State. These revenue increases would be the result of two changes in the bill to
existing fees.
The bill would update the registration fees for repair facilities by reducing the number of fee
categories, gradated by facility revenue, from 20 to 5 and increasing the corresponding fees.
The Department of State estimates that these increases will result in an additional $160,000
annually, bringing annual total registration fee collection from approximately $2.9 million to
$3.1 million. Additional fee revenue would be deposited into the state general fund.
The bill would also increase the fee for the mechanic certification examination by $12, from
$6 to $18. The increased amount would be deposited into the state restricted Mechanic
Certification Examination Fund created by the bill to be used to update the content of the
certification exam to stay current with new technologies and to administer the exam. From each
$18 fee, $6 would continue to be deposited into the general fund.
The department reports that 41,600 exams were administered in FY 2023-24 and that
approximately $250,000 was collected. The fee increase would result in approximately
$500,000 to be deposited into the fund annually. The department estimates that, from the
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 increased revenue, approximately $208,000 would support contracts for updating exams,
another $208,000 would support staff wages in administering the exams, and $83,000 would
support information technology costs related to administering the exams.
POSITIONS:
Representatives of the following entities testified in support of the bill (12-3-24)
• Secretary of State
• Auto Dealers of Michigan
The National Federation of Independent Businesses indicated support for the bill (12-3-24).
Legislative Analyst: Alex Stegbauer
Fiscal Analyst: Michael Cnossen
■ This analysis was prepared by nonpartisan House Fiscal Agency staff for use by House members in their
deliberations and does not constitute an official statement of legislative intent.
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Statutes affected:
Substitute (S-2): 257.1302
Senate Introduced Bill: 257.1302
As Passed by the Senate: 257.1302