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House approves $2 billion more for Cash for Clunkers program
By Kim Nguyen, Staff Writer
The U.S. House of Representatives passed a bill Friday afternoon allowing another $2 billion to fund the Cash for Clunkers program, which offers tax credits to those who trade in old cars for newer, more fuel-efficient models.
The Cash for Clunkers program was approved by Congress in June and set to end on Nov. 1 or whenever the program used up its $1 billion budget. The program kicked-off Monday and immediately found success, as many consumers had been delaying car-repair expenses in the tough economy.
The program was so successful, in fact, that by Thursday, the federal transportation department had raised concerns that the program was already low on funding.
Wylie resident Gabrielle Pate was new car buyer who took advantage of the $3,500 rebate. She and her husband traded in a 2000 Ford Ranger and bought a 2009 Toyota Highlander Monday afternoon at a participating dealership in Richardson. The sales representative made Pate sign a legally binding document that stated if the government did not reimburse the dealership for the money the Pates received for their trade-in, the Pates would be financially responsible to pay the money back themselves.
“The program did enable us to buy a car sooner than we had originally planned,” Pate said. “But there was no timeline. Six months down the line, we could’ve gotten a call from the dealership saying that they had not been reimbursed and needed us to pay.”
Pate said the faults of the Cash for Clunkers program are the confusion created by the sudden rush of consumers and a miscommunication from the federal government to dealers.
“As a consumer, I found the process very confusing,” she said. “If I had known, I certainly wouldn’t have bought a car. People need to know that unless they are willing to risk giving their car up; otherwise they should leave the offer.”
In its current form, the bill redirects $2 billion from a U.S. Department of Energy program loan guarantee program that would have researched innovation in renewable energy technology.
“Not more than a few weeks ago, there were skeptics who weren't sure that this ‘Cash for Clunkers’ program would work. But I’m happy to report that it has succeeded well beyond our expectations and all expectations, and we're already seeing a dramatic increase in showroom traffic at local car dealers,” said President Barack Obama after the vote. “And I’m encouraged that Republicans and Democrats in the House are working to pass legislation today that would use some Recovery Act funding to keep this program going -- funding that we would work to replace down the road. Thanks to quick bipartisan responses, we’re doing everything possible to continue this program and to continue helping consumers and the auto industry contribute to our recovery."
The Senate is expected to vote on the bill early next week.
Cash for Clunkers guidelines:
-People who owned a car made in 1984 or later that got 18 miles to the gallon or less could qualify.
-The car had to have been registered and insured over the past year, and it must have been able to start.
- If applicants to the program traded their clunker for a car that got four more miles per gallon, the government gave them $3,500.
-If the new car got 10 miles more per gallon, the person got $4,500.
-People trading an SUV, minivan or small pickup only had to improve their mileage by 2-5 mpg.
-The vehicle purchased had to be brand new and cost less than $45,000.
The following are comments from the readers.
In no way do they represent the view of Starlocalnews.com
In no way do they represent the view of Starlocalnews.com
Albert wrote on Aug 2, 2009 10:56 AM:
" I tried to use my 1992 GMC Mark III van (12 mpg) as a clunker to buy a Dodge Ram 1500. The dealer said it did not qualify. The government website showed that the van DID qualify. The dealer ripped me off. "
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