D.C. Regulates Problem Auto Businesses Right Off the Lot

By Nikita Stewart
Washington Post Staff Writer
Tuesday, June 30, 2009

D.C. Mayor Adrian M. Fenty announced yesterday that 33 dealers have lost their licenses and 54 businesses have been cited for legal violations in a crackdown on used-car, auto-repair and towing lots.

The tally comes about six months after the city added regulations to rein in businesses that authorities say were a blight. Across the city, some lots were cluttered with dozens of vehicles, making them look like junkyards.

"There are a lot of used-car lots that cause a lot of grief, frustration and wear our constituents' patience to no end," Fenty (D) said at LJ Automotive, a Northwest Washington used-car dealership and repair shop where the city towed away 26 cars. LJ's owners said they are trying to comply with the new rules.

The regulations limit the number of vehicles that can be kept outside and set new business license requirements for salespeople and dealers, among other provisions.

The Department of Consumer and Regulatory Affairs has eased into the regulations, starting with an educational campaign urging voluntary compliance. The agency is ready to begin enforcing more restrictions, but will grant waivers to dealers who applied for permits, giving them more time to make improvements. The rest of the regulations will be enforced starting Sept. 1.

Used-car dealers have complained that the rules are driving them out of business in communities that need inexpensive vehicles and low-cost repairs. Council member Marion Barry (D-Ward 8) has been their most vocal advocate, calling the regulations unfair and costly. Used-car dealers must build storage facilities for vehicles because display on the lot is limited to four vehicles at a time.

Attorney General Peter Nickles acknowledged that several businesspeople are having difficulty meeting the requirement for a $100,000 bond. Insurers and banks are turning them down. Nickles said he is looking at that policy, and businesses attempting to comply are getting extensions.

"We're tough when we need to be tough," Nickles said, adding, "We don't want to put legitimate businesses out of business."

City regulators are working with 14 such dealers.

Brothers Jon and Sotheany Leas said they do not know how much longer they can stay in business, even with assistance. The owners of LJ Automotive said their dealership and repair shop have been hurt by the rules. "Right now, me and my brother, we're fighting each other because we can't pay the light bill," Jon Leas said.

The cost of a license has "doubled, almost tripled," Sotheany Leas said.

The businessmen said they hope the city will ease up and recognize the difficulties many business owners are having, to keep them from leaving the city.

LJ Automotive has been in the same spot on Blair Road NW for nine years.

"We're gonna hang tough," Sotheany Leas said.

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