Reg. M 2015 Supptg Stmt 07-16-15 rev'd FIN

Federal Trade Commission
Supporting Statement for Information Collection
Provisions of Regulation M
(Consumer Leasing Act)
12 C.F.R. 213; 12 C.F.R. 1013
(OMB Control Number: 3084-0086)
1.

Necessity for Collecting the Information

The Consumer Leasing Act, 15 U.S.C. 1667 et seq. (“CLA”), an amendment to the Truth
in Lending Act (“TILA”), 15 U.S.C. 1601 et seq., was enacted to foster comparison shopping and
informed decision making by requiring accurate disclosure of the costs and terms of leases to
consumers. Lessors are subject to disclosure requirements that apply to both open-end leases
(e.g., with a residual due at lease end) and closed-end leases (e.g., “walkaway” leases, with no
substantial amount due at lease end). The CLA now applies to consumer leases up to $54,600
plus an annual adjustment, based on changes made by the Dodd-Frank Wall Street Reform and
Consumer Protection Act (“Dodd-Frank Act”), Pub. L. 111-203, 124 Stat. 1376 (2010).
Subject to the discussion below, the Federal Trade Commission (“FTC” or
“Commission”) enforces the CLA as to all lessors and advertisers except those that are subject to
the regulatory authority of another federal agency (such as federally chartered or insured
depository institutions). The CLA also contains a private right of action with a one-year statute
of limitations for aggrieved consumers.
The Board of Governors of the Federal Reserve System (“FRB”) promulgated the original
Regulation M (12 C.F.R. Part 213) to implement the CLA, as required by the statute. Under the
Dodd-Frank Act, however, almost all rulemaking authority for the CLA transferred from the FRB
to the Consumer Financial Protection Bureau (“CFPB”) on July 21, 2011 (“transfer date”).
Although the Dodd-Frank Act transferred most rulemaking authority under CLA to the CFPB,
the FRB retained rulemaking authority for certain motor vehicle dealers.1 The CFPB’s
regulations for entities under its jurisdiction for Regulation M appear in 12 C.F.R. Part 1013.2
As a result of the Dodd-Frank Act, the FTC and CFPB now share the authority to enforce
Regulation M for entities for which the FTC had enforcement authority before the Act, except for
certain motor vehicle dealers. The FTC generally has sole authority to enforce Regulation M
regarding motor vehicle dealers predominantly engaged in the sale and servicing of motor
1

Generally, these are dealers “predominantly engaged in the sale and servicing of motor vehicles, the leasing and
servicing of motor vehicles, or both.” See Dodd-Frank Act, § 1029(a), -(c).
2

Because both the FRB and the CFPB have certain rulemaking authority under Regulation M – as discussed further
below – citations to both aspects of the regulation are included in this document. Hence, 12 C.F.R. 213 refers to the
FRB-issued Regulation M; 12 C.F.R. 1013 refers to the CFPB-issued Regulation M. Generally, these two aspects of
Regulation M are virtually identical, other than occasional minor technical differences, and citations.

vehicles, the leasing and servicing of motor vehicles, or both.3
Recordkeeping
Sections 213.8/1013.8 of Regulation M requires lessors to retain evidence of compliance
with its requirements (other than its advertising rules), but it does not specify the particular
records to be kept. Entities subject to the regulation may choose the records they consider
adequate to show compliance, and each entity may interpret the requirement differently.
Records, however, must be retained for twenty-four months.
Disclosure
Regulation M imposes disclosure requirements on all types of lessors, including
automobile lessors (such as auto dealers, independent leasing companies, and manufacturers’
captive finance companies), computer lessors (such as computer dealers and other retailers),
furniture lessors, various electronic commerce lessors, and diverse types of lease advertisers, and
others. These requirements are intended to ensure that consumers are fully apprised of the terms
of leases prior to consummation of the transaction. The written disclosures required by
Regulation M are derived from statutory disclosures and directives mandated by the CLA. See
12 C.F.R. 213.4/12 C.F.R. 1013.4; 15 U.S.C. 1667a; 15 U.S.C. 1667f (written disclosures); 12
C.F.R. 213.7/12 C.F.R. 1013.7; 15 U.S.C. 1667c; 15 U.S.C. 1667f (advertising disclosures).
The FRB and CFPB have issued model forms and clauses that can be used to comply
with the written disclosure (non-advertising) requirements of the CLA and Regulation M. See,
e.g., Appendices A-1 - A-3 to Regulation M; 12 C.F.R. 213, Appendices A-1 - A-3; 12 C.F.R.
1013, Appendices A-1 - A-3. Correct use of these model forms and clauses insulates lessors
from liability for the respective requirements under the CLA and Regulation M. See FRB
Official Staff Commentary to Regulation M (“FRB Commentary”), Appendix C, Comment 1; 12
C.F.R. 213, Supp. I, Appendix C, Comment 1; CFPB Official Staff Commentary to Regulation
M (“CFPB Commentary”), Appendix C, Comment 1; 12 C.F.R. 1013, Supp. I, Appendix C,
Comment 1.
2.

Use of the Information

The FTC, other agencies, and private litigants use the records to ascertain whether
accurate and complete disclosures of the cost of leases have been provided to consumers prior to
consummation of the lease. This information provides the primary evidence of law violations in
CLA enforcement actions brought by the FTC. Without the Regulation M recordkeeping
requirement, the FTC’s ability to enforce the CLA would be significantly impaired.
3

See Dodd-Frank Act, § 1029(a), -(c).

2

As noted above, consumers rely upon the disclosures for information to comparison shop
among leases, as well as to ascertain the true costs and terms of lease offers. This information
provides the primary evidence of law violations in CLA enforcement actions brought by the FTC
and private actions brought by consumers. Without these requirements, and the resulting
disclosures, the FTC (and consumers) would be unable to enforce the law.
3.

Consideration of the Use of Improved Information Technology

The FRB and CFPB have issued rules to establish uniform standards for using electronic
communication to deliver disclosures required under Regulation M, within the context of the
Electronic Signatures in Global and National Commerce Act (“ESIGN”), 15 U.S.C. 7001 et seq.,
and Sections 213.3(a)/1013.3(a) of Regulation M. These rules enable businesses to utilize
electronic disclosures and compliance, consistent with the requirements of ESIGN. Use of such
electronic communications is also consistent with the Government Paperwork Elimination Act
(“GPEA”), codified at 44 U.S.C. 3504, note. ESIGN and GPEA serve to reduce businesses’
compliance burden related to federal requirements, including Regulation M, by enabling lessors
to utilize more efficient electronic media for disclosures and compliance.
Regulation M also permits a lessor to retain records by microfilm or microfiche or by any
other method that reproduces records accurately (including computer programs). Lessors need
only retain enough information to reconstruct the required disclosure or other records. Section
213.8-1 of the FRB Commentary; Section 1013.8-1 of the CFPB Commentary.
4.

Efforts to Identify Duplication/Availability of Similar Information

The recordkeeping requirement of Regulation M preserves the information provided by
the lessor to consumers considering the costs and terms of lease offers. The lessor is the only
source of this information. No other federal law, nor is staff aware of any state law, that
mandates retention of this information. Similarly, the disclosures required by the CLA and
Regulation M are not required by any other provision of law. Although some lease cost
information is contained in contractual documents, the information is not standardized. As a
result, consumers cannot use it efficiently to comparison shop or fully appreciate lease terms.
The lessor is the only source of this information. No other federal law mandates these
disclosures. State laws do not duplicate these requirements, although some states may have other
rules applicable to consumer leases.
5.

Efforts to Minimize Burdens on Small Businesses

The Regulation M recordkeeping and disclosure requirements are imposed on all lessors.
The recordkeeping requirement is mandated by Regulation M. The disclosure requirements are
mandated jointly by the CLA and Regulation M. As previously noted, the FTC’s role in this area
is limited to enforcement because the CLA vested rulemaking authority in the FRB and CFPB.
Nonetheless, as also noted above, Regulation M provides model forms and clauses that may be
3

used to comply with its disclosure requirements. Correct use of these forms and clauses insulates
a lessor from liability for the respective requirements.
6.

Consequences of Conducting Collection Less Frequently

The current record retention period of two years supports the one-year statute of
limitations for private actions, and the FTC’s (and other administrative agencies’) need for
sufficient time to bring enforcement actions regarding lease transactions. If the retention period
were shortened, consumers who sue under the CLA, and the administrative agencies, might find
that lessor records needed to prove violations of the CLA no longer exist.
The disclosure requirements are needed to facilitate comparison cost shopping and to spur
informed lease decision making. If these requirements were eliminated, consumers would not
have access to this critical information. Their right to sue under the CLA would be undermined,
and the FTC (and other administrative agencies) could not fulfill their mandate to enforce the
CLA.
7.

Circumstances Requiring Collection Inconsistent with Guidelines

The recordkeeping and disclosure requirements in Regulation M are consistent with the
applicable guidelines contained in 5 C.F.R. 1320.5(d)(2).
8.

Consultation Outside the Agency

The disclosure and recordkeeping requirements of Regulation M were issued by the FRB
and CFPB. Before the regulation was initially issued and prior to each amendment, the
amendments were published for public comment in the Federal Register.
More recently, the Commission sought public comment in connection with its latest PRA
clearance request for these regulations, in accordance with 5 C.F.R. 1320.8(d). See 80 Fed. Reg.
17,749 (April 2, 2015). The Commission received a comment from the National Automobile
Dealers Association (“NADA”) pertaining to regulatory burden affecting Regulation M. The
comment repeats many of the points NADA made in its comments submitted in 2012 when the
FTC last sought renewed OMB clearance regarding the FTC’s enforcement oversight of the
recordkeeping and disclosure provisions of these regulations issued by the FRB and CFPB.4
As before, NADA asserts that the FTC’s burden estimates greatly underestimate its

4

NADA’s 2015 comment and related 2012 comment are available at https://www.ftc.gov/policy/publiccomments/2015/06/01/comment-00003. The remaining (two) commenters’ submissions were not relevant to the
statutes and regulations at issue.

4

members’5 regulatory burdens under Regulation M. Despite the FTC’s prior and continuing
explanation in its Federal Register Notices regarding the terms “setup,” “monitoring,” and
“transaction-related,” NADA has misinterpreted FTC estimates of disclosure time per
transaction as the estimated time the FTC accords to monitoring to review compliance.6 Rather,
FTC estimates of “monitoring” burden address covered entities’ time and costs to review changes
to regulatory requirements, make necessary revisions to compliance systems and procedures, and
to monitor the ongoing operation of systems and procedures to ensure continued compliance.
“Transaction-related” burden, by contrast, refers to the disclosure time and cost per individual
transaction, thus, generally, of much lesser magnitude than “monitoring” (or “setup”) burden.
In its June 1, 2015 comment, NADA asserts that “daily compliance burdens at a
dealership often must be handled by managerial, not clerical staff.”7 NADA also asserts that
“[m]any dealers are small businesses that do not benefit from sophisticated records retention or
computer systems, and cannot leverage robust compliance structures. Even larger dealer groups
often do not have the economy of scale necessary to justify in-house legal counsel, compliance
staff, or other expert or technical resources. As a result, they rely heavily on outside counsel,
consultants, and computer and other experts to help them to comply with their regulatory
obligations – and pay the concomitant fees associated with those third party services.”
While Regulation M covers not only NADA’s membership of franchised car and truck
dealers, but also independent motor vehicle dealers and non-motor vehicle dealers, NADA’s
constituency comprises a sizeable proportion of the overall affected respondents under
Regulation M to warrant FTC staff’s reassessment of and adjustment to its prior estimates for
labor cost burden under the regulation. It is not practicable, however, to make projections about
and provide estimates regarding the additional or alternative use of such outside sources to
maintain regulatory compliance (neither has NADA attempted to do so in its comment). Instead,
the FTC’s revised labor cost estimates increase apportionment to managerially performed tasks
from 10% to 90%, and remove “clerical” support, while allocating the remaining 10% to skilled
technical staff. In doing this, it is worth noting that in NADA‘s survey of its members in 2012 –
reincorporated in NADA’s 2015 comment – the purported average response for labor
apportionment for all facets of complying with Regulation M was no more than 61.5% for
managerial staff, 24.7% for technical staff, and 13.9% for clerical staff. Accordingly, FTC staff
believes that its reapportionment of labor costing under Regulation M is a fair response to these
5

NADA states that it represents approximately 16,000 new car and truck dealers, both domestic and import, with
over 32,500 separate franchises. Id.
6

In NADA’s 2015 comment, it misread the 15 second estimates the FTC accorded to disclosure time per lease
advertisement, as the time the FTC estimated for dealer monitoring of advertisements for compliance under
Regulation M. In actuality, the FTC estimate for the latter monitoring category, and as reappearing in the Regulation
M disclosure hour tables in this Notice, is 30 minutes for lease advertising.
7

However, the only apportioning in the FTC’s estimates to clerical staff was for recordkeeping. The remaining
attributions, for disclosure, had been to managerial (10%) and skilled technical (90%) staff.

5

varying propositions and conditions. This reapportionment appears in the labor cost burden table
appearing in response to item 12 of this document.
In addition, NADA’s comment states that, for Regulation M, the estimate that assumed an
average of 40 lease advertising transactions per respondent is not adequate, and that dealers
advertise hundreds, if not thousands, of vehicles per year with many ads being subject to
Regulation M. However, the FTC’s estimates of transaction time and volume are intended as
averages. Some respondents may have more covered ads, and others may have fewer (if any).
Moreover, the number of vehicles advertised is not the issue for compliance with Regulation M
requirements; rather the question is whether specific terms used in the advertisements trigger the
disclosure requirements of this regulation.8 Some entities’ advertisements may not include terms
that are covered by these requirements at all.9
Finally, we note that the report developed for NADA and attached to NADA’s comment
by the Center for Automotive Research (“CAR Report”) addresses the impact on franchised
automobile dealerships related to many federal statutes, regulations, and requirements. NADA
stated these requirements cover diverse issues but that certain regulations, including Regulation
M, still “represent a material portion of dealers’ regulatory obligations.” See, e.g., NADA
comment, CAR Report at 2, 3, 19-34. However, NADA’s specific points refer to a generalized
concern about regulatory burden for automobile dealers.
Nonetheless, as noted above, the FTC estimates for this regulation have been partially
revised in response to some of NADA’s comments. This is shown below in the labor cost
calculation table. Consistent with 5 C.F.R. 1320.12(c), the FTC is again seeking public comment
contemporaneously with this submission.
9.

Payments or Gifts to Respondents
Not applicable.

8

Further, to facilitate compliance, Regulation M permits the use of illustrative transactions to make the necessary
disclosures. That is, where a range of terms is possible or offered, the ad may use examples of typical transactions
and include the required disclosures, rather than stating a wide list of transactions and terms for multiple vehicles.
See 12 C.F.R. 1013.7(d)(1)-1, Supp. 1, and 12 CFR 213.7(d)(1)-1, Supp. 1, CFPB and FRB Regulation M Official
Staff Commentaries.
9

For example, some advertisements may promote sales prices rather than lease terms, and are not subject to
Regulation M. Other ads generally may promote the availability of leasing without specific terms, such as “welcome
college graduates and military.” Some ads may offer terms that do not trigger advertising responsibilities under
Regulation M, such as “we offer long-term leasing.”

6

10. & 11.

Assurances of Confidentiality/Matters of a Sensitive Nature

The required recordkeeping and written disclosures contain private financial information
about consumers who apply for and/or obtain consumer leases. Such information is protected by
the Right to Financial Privacy Act, 12 U.S.C. 3401 et seq. Such records may also constitute
confidential customer lists. Any of these records provided to the FTC would be covered by the
protections of Sections 6(f) and 21 of the FTC Act, 15 U.S.C. 46(f) and 57b-2, by Section 4.10 of
the Commission's Rules of Practice, 16 C.F.R. 4.10, and by the exemptions of the Freedom of
Information Act, 5 U.S.C. 552(b), as applicable.
12.

Estimated Hours and Labor Cost Burden
Estimated Hours Burden: 106,510 (32,577 recordkeeping hours: 5,000 + 27,577
carve-out for motor vehicles + 73,933 disclosure hours: 2,986 + 70,947 carve-out for
motor vehicles)10

The following discussion and tables present FTC estimates under the PRA of
recordkeeping and disclosure average time and labor costs, excluding that which the FTC
believes entities incur customarily in the ordinary course of business11 and information compiled
and produced in response to FTC law enforcement investigations or prosecutions.12
10

Recordkeeping and disclosure burden estimates for Regulation M are more substantial for motor vehicle leases
than for other leases, including burden estimates based on market changes and regulatory definitions of coverage. As
noted above, for purposes of burden calculations, and in view of the different types of motor vehicle dealers, the
FTC is including for itself the entire PRA burden for all motor vehicle dealers in the burden estimates below.
11

PRA “burden” does not include “time, effort, and financial resources” expended in the ordinary course of business,
regardless of any regulatory requirement. See 5 CFR 1320.3(b)(2).
12

See 5 CFR 1320.4(a) (excluding information collected in response to, among other things, a federal civil action or
“during the conduct of an administrative action, investigation, or audit involving an agency against specific
individuals or entities”).
FTC enforcement initiatives are based on diverse statutory and regulatory requirements. Some actions are
brought in partnership with other federal and state agencies and encompass matters enforced by those agencies, not
solely issues related to Regulation M. Further, even where Regulation M matters also are involved in FTC actions,
or are in the broader initiative or enforcement sweep of automobile actions, the actions frequently include charges of
unfair and/or deceptive practices under Section 5 of the FTC Act, 15 U.S.C. 45(a), and/or may involve warranty
violations under the Magnuson Moss Warranty Act, 15 U.S.C. 2301-2312, and other issues not pertinent to this PRA
submission. See, e.g., FTC, Press Release, FTC, Multiple Law Enforcement Partners Announce Crackdown on
Deception, Fraud in Auto Sales, Financing and Leasing, Mar. 26, 2015, available at https://www.ftc.gov/newsevents/press-releases/2015/03/ftc-multiple-law-enforcement-partners-announce-crackdown. The FTC also
frequently issues business “blog” guidance with its enforcement initiatives to guide and facilitate compliance. See,
e.g., Lesley Fair, Operation Ruse Control: Six tips if cars are up your alley, FTC BUSINESS CENTER BLOG
(Mar. 26, 2015), available at https://www.ftc.gov/news-events/blogs/business-blog/2015/03/operation-ruse-control6-tips-if-cars-are-your-alley; Lesley Fair, “Advertise auto promotions car-fully,” FTC BUSINESS CENTER BLOG
(Dec. 23, 2014), available at https://www.ftc.gov/news-events/blogs/business-blog/2014/12/advertise-autopromotions-car-fully.

7

Because of their shared enforcement jurisdiction for Regulation M, the CFPB and FTC
have divided the FTC’s previously-cleared PRA burden between them,13 except that the FTC has
wholly assumed the part of that burden associated with motor vehicle dealers (for brevity,
referred to in the burden summaries below as a “carve-out”).14 The division of PRA burden
hours not attributable to motor vehicle dealers is reflected in the CFPB’s PRA clearance requests
to OMB.15 The FTC’s burden estimates below reflect both the shared enforcement jurisdiction
and the FTC’s separate accounting under the PRA for its jurisdiction to enforce Regulation M for
motor vehicle dealers.
Recordkeeping
Staff estimates that Regulation M’s recordkeeping requirements affect approximately
32,577 firms within the FTC’s jurisdiction leasing products to consumers at an average annual
burden of one hour per firm, for a total of 32,577 hours.
Disclosure
Regulation M applies to automobile lessors (such as auto dealers, independent leasing
companies, and manufacturers’ captive finance companies), computer lessors (such as computer
dealers and other retailers), furniture lessors, various electronic commerce lessors, and diverse
types of lease advertisers, and others. Below is staff’s best estimate of burden applicable to this
very broad spectrum of covered entities.
Regulation M: Disclosures – Burden Hours

Disclosures

Motor Vehicle Leases1
Other Leases2
Advertising3

13

--------------- Setup/Monitoring ---------------------- Transaction-related----------Average
Total Setup/
Average
Total
Burden per
Monitoring
Number of Burden per Transaction
Respondents Respondent
Burden
Transactions Transaction
Burden
(hours)
(hours)
(minutes)
(hours)
27,577
5,000
15,181

1
.50
.50

27,577
2,500
7,591

4,000,000
100,000
603,490

.50
.25
.25

33,333
417
2,515

Total
Burden
(hours)
60,910
2,917
10,106

The CFPB also factored into its burden estimates respondents over which it has jurisdiction but the FTC does not.

14

This includes dealers specified by the Dodd-Frank Act under § 1029 (a), but as limited by subsection (b).
Subsection (b) does not preclude CFPB regulatory oversight regarding, among others, businesses that extend retail
credit or retail leases for motor vehicles in which the credit or lease offer is provided directly from those businesses,
rather than unaffiliated third parties, to consumers. It is not practicable, however, for PRA purposes, to estimate the
portion of dealers that engage in one form of financing versus another (and that would or would not be subject to
CFPB oversight). Thus, FTC staff’s “carve-out” for this PRA burden analysis reflects a general estimated volume of
motor vehicle dealers. This attribution does not change actual enforcement authority.
15

OMB Control Number 3170-0008 (Regulation M).

8

Total

73,933

1

This category focuses on consumer vehicle leases. Vehicle leases are subject to more lease disclosure requirements (pertaining to computation of
payment obligations) than other lease transactions. (Only consumer leases for more than four months are covered.) See 15 U.S.C. § 1667(1); 12
CFR § 1013.2(e)(1). While the number of respondents for vehicle leases has decreased, the number of vehicle lease transactions has increased,
with market changes, from past FTC estimates. Additionally, leases up to $54,600 (plus an annual adjustment) are now covered. The resulting
total burden has increased.
2
This category focuses on all types of consumer leases other than vehicle leases. It includes leases for computers, other electronics, small
appliances, furniture, and other transactions. (Only consumer leases for more than four months are covered.) See 15 U.S.C. § 1667(1); 12 CFR
§ 1013.2(e)(1). The number of respondents has decreased, based on market changes in companies and types of transactions they offer; the number
of such transactions has also declined, based on types of transactions offered that are covered by the CLA. Leases up to $54,600 (plus an annual
adjustment) are now covered. The resulting total burden has decreased.
3
Respondents for advertising have increased as have lease advertisements, based on market changes, from past FTC estimates. More types of lease
advertisements are occurring. The resulting total burden has increased.

Associated labor costs: $5,815,432 ($1,778,700 recordkeeping costs: $273,000 +
$1,505,700 carve-out for motor vehicles + $4,036,732 disclosure costs: $163,030 +
$3,873,702 carve-out for motor vehicles)
Staff calculated labor costs by applying appropriate hourly cost figures to the burden
hours described above. The hourly rates used below ($56 for managerial or professional time,
$42 for skilled technical time, and $17 for clerical time) are averages.16
Recordkeeping
For the 32,577 recordkeeping hours, staff estimates that 90 percent of the burden hours
require managerial time and 10 percent require skilled technical time. As shown below, the total
recordkeeping cost is $1,778,700.
Disclosure
For each notice or information item listed, staff estimates that 90 percent of the burden
hours require managerial time and 10 percent require skilled technical time. As shown below,
the total disclosure cost is $4,036,732.
Regulation M: Recordkeeping and Disclosures – Cost

Required Task
Recordkeeping

------Managerial------

-----Skilled Technical-----

Time
(hours)

Cost
($56/hr.)

Time
(hours)

29,319

$1,641,864 3,258

$136,836

Cost
($42/hr.)

--------Clerical-------Time
(hours)

0

0

Cost
($17/hr.)

Total
Cost
($)

$1,778,700

Disclosures:
16

These inputs are based broadly on mean hourly data found within the “Bureau of Labor Statistics, Economic News
Release,” March 25, 2015, Table 1, “National employment and wage data from the Occupational Employment
Statistics survey by occupation, May 2014.” http://www.bls.gov/news.release/ocwage.t01.htm.

9

Motor Vehicle Leases
Other Leases
Advertising
Total Disclosures

54,819
2,625
9,095

$3,069,864 6,091
$147,000
$509,320

$255,822
292
1,011

0
$12,264
$42,462

Total Recordkeeping and Disclosures

13.

0
0
0

$3,325,686
0
$159,264
0
$551,782
$4,036,732
$5,815,432

Estimated Capital and Other Non-Labor Costs

The applicable requirements impose minimal start-up costs, as lessors and/or advertisers
generally have or obtain necessary equipment for other business purposes. For the same reason,
staff believes that the cost of printing and copying needed to comply with Regulation M is
minimal. Staff anticipates that the requirements noted above necessitate ongoing, regular
training so that covered entities stay current and have a clear understanding of federal mandates.
However, this training would be a small portion of and subsumed within the ordinary training
that employees receive apart from that associated with collecting information to comply with
Regulation M.
14.

Estimated Cost to the Federal Government

The FRB and CFPB issued the recordkeeping requirement of Regulation M, so there is no
cost to the FTC for that purpose. Enforcement of the recordkeeping requirement of Regulation
M is incidental to overall enforcement of the CLA. Staff estimates that enforcing this
requirement will cost the FTC Bureau of Consumer Protection no more than $81,303, which is a
representative year’s cost of enforcing Regulation M’s requirement during the three-year
clearance period sought. This estimate is based on the assumption that one-half of one attorney
work year will be expended. Clerical and support services are included in this estimate.
The FRB and CFPB issued the Regulation M disclosure requirements, so there is no cost
to the FTC for that purpose. Regarding enforcement, staff estimates that the cost to the FTC
Bureau of Consumer Protection for these requirements will approximate $325,206. This
estimate is based on the assumption that two attorney work years will be expended. Clerical and
other support services are included in this estimate.
15.

Program Changes or Adjustments

Estimated net annual burden, cumulative of recordkeeping and disclosure, has decreased
by 16,335 hours (from 122,845 hours to 106,510 hours). Cumulative estimated burden for
recordkeeping, though unchanged per respondent (one hour), decreased due to a reduced
estimated number of affected respondents (from 54,442 to 32,577). Estimated cumulative
disclosure burden increased by 5,530 hours (from 68,403 hours to 73,933 hours). This reflects
the combination of increased volume of vehicle lease transactions and lease advertisements,
generally (each a reflection of market changes), as well as an increase in the estimated number of
respondents promoting leases (and hence providing advertising disclosures). The overall
increase in estimated labor costs (from $3,129,338 to $5,815,432), after factoring in the
10

offsetting effects above, is the result of updated, higher mean hourly wage estimates for the
assumed labor categories in staff’s analysis and the adjustments staff made in response to
NADA’s comment.
16.

Publishing Results of the Collection of Information
Not applicable.

17.

Display of Expiration Date for OMB Approval
Not applicable.

18.

Exceptions to the Certification for PRA Submissions
Not applicable.

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