As the opening day of the 82nd Texas legislature approaches it seems a good retrospective exercise to look at legislation authored by some Texas Republicans and passed during the 81st session. Let’s evaluate exactly how “middle class friendly” and “business friendly” one of these laws really is, shall we?

Out of 152 bills originating from the House Committee on Pensions, Investments and Financial Services in 2009, 64 bills got out of committee and 19 of those became law effective September 1, 2009.

Senate Bill 1966, authored by Senator Chris Harris (R- TX 9; Dallas, Tarrant and Denton County area) amended the Finance Code to authorize the retail seller, in the course of a motor vehicle installment agreement, to offer the buyer something called a debt cancellation agreement. Here’s a link to the analysis of the bill. The debt cancellation agreement stipulates the seller would agree to cancel all or part of the buyer’s obligation to pay the remainder of the payments contracted in the installment agreement upon the motor vehicle’s total loss or theft for a “reasonable” fee.

Now this sounds like a good middle class and consumer friendly law on the surface, doesn’t it? Your car becomes a total loss through no fault of your own and you can pay a reasonable fee to absolve yourself from paying the rest of what you agreed to pay.

Who would this legislation affect? Not people who pay cash for cars, but the middle class who finance the purchase of their vehicle. Wouldn’t that “reasonable fee” INCREASE the total purchase price of the car bought by that middle class consumer?

Lastly, the debt cancellation agreement applies should the automobile be involved in a total loss (accident or natural disaster, I’d assume) or theft. Hello? Car accident? Theft? Natural disaster? Flood? Hurricane? Higher automobile insurance rates as a result of that total loss or theft?

Oh and aren’t Texas liability coverage requirements going up again on January 1?

This is a middle class and consumer un-friendly law, designed to increase the costs associated with automobile ownership and operation for middle class families and be “business friendly” to insurance companies and car dealers.

BTW, this Texas House Democrat is in the automobile insurance industry.

Thanks Senator Harris.

Chris Harris holds a 62 percent rating of support for Americans For Prosperity- Texas.