Illinois governor squashes car rental giants' efforts to kill car sharing

August 30, 2018

Illinois Gov. Bruce Rauner on Tuesday vetoed a bill that would have made peer-to-peer car-sharing all-but impossible in the Midwestern state.

Ars Technica reported that the bill started off as an innocuous attempt to update state rules on rental car damage waivers, but lobbyists from Enterprise Rent-A-Car were able to wedge last-minute amendments into the proposal aimed at peer-to-peer services such as Turo and General Motors-owned Maven.

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The regulations would have increased taxes on peer-to-peer rentals and applied rental car facility standards such as sign regulations not relevant to an internet-based car-share service with no physical presence. Turo and Maven operate via a website and a smartphone app much in the way Airbnb facilitates property rental.

The Illinois bill was amended before the public had a chance to comment.

"Illinois was the only state where we were never given a chance to substantively discuss those regulations before they were rammed through to approval," Michelle Peacock, Turo vice president of government relations, said in a statement.

Insurer Allstate also voiced its approval of Rauner's veto.

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"The governor's proposed changes will foster the innovation necessary to make car-sharing a reality and should be supported by the legislature as a vote for family economic wellbeing," Allstate Chairman, President and Chief Executive Officer Tom Wilson said in a statement.

The biggest hurdle for the internet-based peer-to-peer rentals would have been a hefty increase in the taxes renters pay—an additional 5 percent at the state level and as much as 15 percent levied by local municipalities.

Turo argued that owners of vehicles in its network paid sales taxes when they bought their cars, while Enterprise and other major rental car firms are exempt from paying sales taxes.

Turo said that 7,300 Illinois residents rent their cars out using the service.

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