WASHINGTON, D.C. — U.S. Senate floor activity is particularly important to the National Automobile Dealers Association and dealership management this week. Lawmakers are ramping up consideration of the proposed Bureau of Consumer Financial Protection, which could completely change how dealerships operate, some argue.

NADA emphasized that the bill would produce sweeping powers to control dealer-assisted financing and even commissions for store salespeople. However, an initial Senate vote to start extended floor debate about bureau creation failed to receive majority support on Monday. A report indicated the vote just missed the necessary majority threshold as the count stood at 57-41.

Although seen as an initial block to the bill, NADA chairman Ed Tonkin reinforced the association's fervent stance against this measure since Senators could vote again to take up debate later this week.

"Adding another layer of regulation will reduce availability of credit and increase costs to consumers," Tonkin emphasized.

"Auto dealers should be excluded from the bureau. Wall Street caused the financial meltdown, not local auto dealers on Main Street," he went on to stress.

"We're not seeking exemption from federal and state regulation," Tonkin added. "There are already effective federal and state laws that govern dealer-assisted financing."

What Tonkin and the NADA have thrown their support behind is an amendment by Sen. Sam Brownback, a Republican from Kansas. Brownback's proposal would exempt dealers from the bureau. 

"Keep in mind, the House exempted auto dealers from its financial reform bill for good reason. The Senate should do the same," Tonkin stated.

"Auto dealers should never have been included in the Senate bill in the first place. The Brownback Amendment will correct that mistake," Tonkin pointed out.

Besides Tonkin's remarks, NADA offered several other reasons why it's so adamant against dealers being included in creation of the Bureau of Consumer Financial Protection.

—NADA believes auto loans had nothing to do with the economic crisis, and financial reform legislation should focus on what caused the crisis: the big financial institutions of Wall Street.

—The association contends auto finance model is sound, not broken, since vehicle financing is secured by a depreciating asset which lenders must factor into their underwriting. NADA said this forces lenders to look to the borrower for repayment of the loan. Unlike mortgages, the association pointed out that auto finance did not experience a subprime lending crisis and has never posed a systemic risk.

—NADA reiterated that dealers are not lenders; they are facilitators. Association leadership argues that dealers provide optional retail finance services at their dealerships in virtually every community in the country.

"Dealers increase financing competition by providing consumers with a wide variety of options from multiple financing sources. Dealers increase access to credit for consumers. Because of this competition, dealer-assisted financing reduces the cost of credit to consumers," NADA explained.

—The association also noted that access to affordable credit is essential for vehicle buyers since 94 percent of all retail vehicle sales in 2008 were financed.

"Congress should not take any action that could increase the cost of credit to consumers," officials stressed.

—NADA contends that over-regulation would put at risk the efficiency of the current system.

"The fact is, dealer-assisted financing provides affordable options for consumers of all economic levels. And the service is entirely voluntary," the association stated.

"Plus, if consumers are not satisfied with financing at the dealership, they can go elsewhere to refinance, many times at no additional cost," officials added.

—The association noted that according to data from the Federal Trade Commission in 2009, less than 2 percent of consumer complaints were auto related and an even smaller percentage was related to auto finance.