Good morning, everybody. We're just waiting for everyone to join us. We'll begin in just a moment. Well, good morning, everybody, and thank you for joining us today. I'm Brian McGuire. It is a pleasure to welcome you to the webinar on Right to Repair. We're joined today by Daniel Fisher and Kyle Larkin. I want to remind everybody that today's presentation is being recorded, and feel free to submit your questions in the chat box to Mr. Fisher, who will coordinate answering them throughout the program. But we wanted to do this webinar today because, as many of you are aware, Right to Repair issues are popping up not just at the national level in both Canada and the United States, but also at the provincial and state level. And so we've seen a lot of activity just in the last couple of weeks, and it's good to know the scorecard, if you will, of where things are going. So with that, I will turn it over to Daniel Fisher, and thank you for joining us. Thanks Brian, and thank you everyone for joining. I've got a great group on, so clearly there's a lot of interest in this topic. As Brian mentioned, you certainly can enter your questions in the chat box at the bottom, and also we will circulate the recording of this webinar to everyone who had registered. So what is Right to Repair? Right to Repair really is kind of a simple slogan, very catchy, of course, because who doesn't support the right to repair? But I think the devil's really in the details when you get to these proposals. So kind of at a broad view, these bills require customers and third-party repair providers to provide unfettered access, requires customers and third-party repair providers to have unfettered access to embedded software and source code. Of course, there's a great deal of issues that pop up there, whether it's environmental safety, liability issues, when you start giving this kind of access to everyone. Proposals usually feature a mandate that OEMs sell parts at a fixed price directly to customers and third-party repair providers. I think that's probably the most concerning at a dealer level in terms of having kind of a price control on how much you can sell parts for. Right to Repair originally was targeting consumer products such as iPhones, kind of personal electronics, but it's been broadened over the last few years to apply to off-road equipment. And really, I think a lot of these consumer groups that we'll talk about a bit later on have used the kind of farmers as well as a sympathetic voice to kind of push this Right to Repair narrative to go well beyond what I think most people had intended in kind of the beginning of this whole effort. It had been a state issue for a number of years. We've been battling this at the state level for a while now, but it's now active at the federal levels in the United States as well as in Canada. And so we're going to do something a little different this time. We're going to go to Canada first. Normally, all our Canadian friends have to sit through the U.S. update, and then we get to them at the end. But we're going to go right to Canada and get an update on Right to Repair from Kyle Larkin, who is with Impact Canada. Kyle's kind of my counterpart up in Ottawa, running the AED office up there. And most of you know he does not look this good in person, and great Photoshopping effort there. But Kyle, why don't you give us the update on Canada? Thanks, Daniel. And Daniel, I asked not to have my mug on this slide, and Daniel still put it up there. So I appreciate that. You're making me look good. You're just so good looking. I just can't marry that. There you go. So what I would start off from right off the top of the bat in terms of the Canadian update on Right to Repair is that I'd say we're a few steps behind of where things are in the U.S. This has really only just cropped up, I would say, over the past year or two, only at the federal level. It hasn't necessarily reached the provincial level yet. There is a bill in Quebec, but it's not necessarily something to worry about. And the reason why it hasn't cropped up at the provincial level is because the Copyright Act at the federal level needs to be amended first before legislation at the provincial level can have a true effect. And that's where Bill C-244 comes in. So I'll read you directly the summary of the bill, because I think it encapsulates what this would do. It would amend the Copyright Act in order to allow the circumvention of a technological protection measure, a TPM, in a computer program if the circumvention is solely for the purpose of the diagnosis, maintenance, or repair of a product in which the program is embedded. So to just boil that down a bit, the Bill C-244, in theory, would allow for customers of heavy equipment to gain access to the software to be able to tinker it one way or another. The issues that we're putting forward in front of Parliament are multifaceted, but really the top line are, first of all, there's a safety concern. If you can get access to all that software, you can tinker as much as you want in terms of the safety standards included in heavy equipment. The second concern is around emission standards. So the great example I give is, if you own a combine and you can harvest your crop, let's say, in 10 hours and it's maxed out, it can only go so fast because of the emission standards, why wouldn't you go in the software, tinker it so it can go a bit faster and you can finish your crop in half the time or even less? So that's kind of what we're looking at. There's a safety issue, there's an emissions and climate change issue, there's obviously a liability issue as well, and there's even more of an environmental issue in terms of the used equipment and if it's all modified, where does it go? So in terms of where C-244 is right now, AD has appeared before the committee. We've met with many of the members of Parliament on the committee as well. Right now, it's kind of in limbo at the committee stage. The Liberals want to, I would say, gut the bill so that it's more in line with the US-Mexico-Canada trade agreement. Right now, the way the bill is framed is that it would actually contravene some of the articles included in that trade agreement. So the Liberals, as the government, responsibly want to amend the legislation so it doesn't do that. The Conservatives, on the other hand, are looking towards a similar model that was adopted in the US regarding a copyright librarian. That model isn't necessarily gaining much traction at the committee. If you were to ask me, where is it going to go? It's probably going to go the Liberal way, but there's also a larger conversation happening at the government level between ministers. You have the Minister of Industry and you have the Minister of Environment that are kind of at loggerheads in the sense of what they want to do with right to repair. So the Minister of Industry actually has been given a mandate to look at right to repair, but only for consumer electronics and home appliances. So really strictly to those products, while the Minister of Environment wants to really expand it to everything. Right now, it looks like the Minister of Industry is going to have his way in terms of where this goes. So we're looking at a model similar to what we're seeing in France and the European Union on the Europe side, where instead of opening up the Copyright Act, etc., etc., it would instead be very similar to the ENERGY STAR program, for example, that exists for home appliances, where there'd be a few stickers on home appliances and this could expand to heavy equipment. One sticker would talk about durability in the sense of how durable is this appliance or this piece of heavy equipment? What's the average lifespan? Is it five years? Is it 10 years, 20 years, etc.? It would give that specific date. And there would also be a rating on repairability. So how repairable is this equipment from a customer perspective, not necessarily a certified technician perspective? So all I have to say, they're looking at it right now just for consumer electronics and home appliances, but this could easily be expanded to heavy equipment. There's certainly a big push by CAUCUS and the Minister of Environment to build it towards that. In terms of next steps, the committee has given itself 30 days to consult with the departmental level in the sense of where they want to go with this legislation. So that's coming up in a few days, sorry, in a few weeks, and the committee will reconvene then to figure out what they want to do with C-244. But like I said, I think there's a larger conversation happening right now with government. That's not necessarily public yet, but I think it will come public within the next few weeks because the government certainly wants to get ahead of this private members bill before it goes anywhere so they can take over the conversation. Daniel, anything I missed there? No, no, that sounds good. So just in terms of AED's engagement, what have we been doing to kind of push back against the efforts? Yeah, absolutely. Like I said, we appeared before the committee, we've engaged with all the members of parliament around that committee. The other big thing I would say we've done is we've booked around over 15 tours so far in 2023 for local AED member facilities to meet with their local members of parliament. So we've had members of parliament do tours of heavy equipment dealers across Canada in almost every province in the country. It's something we're still pushing for. If you folks have any facilities in Canada that haven't been visited yet by a member of parliament, let me know or let Daniel know or Mike Dexter know. We'll take care of you and take care of organizing that. But that's really the best way for MPs to understand all the complexities that are in heavy equipment. I would say that when an MP thinks of a piece of heavy equipment, they're not necessarily thinking of the software and everything else that's embedded in it. They're thinking of what heavy equipment may have looked like 20, 30 years ago. Not really the technological advancements that it's had since then. So it's a great way for them to see firsthand how big, first of all, these pieces of equipment can be, but also how complicated they can be and why a certified technician is needed for a lot of these repairs. All right. Well, great. Thank you, Kyle. Kyle's got to run something about a hockey game. But any questions, we'll certainly pass along if there are any questions for Kyle. So thanks, Kyle, for being here. Great job. All right. So past activities. So how did we get to where we are today? Well, there's been many years of state activity in the United States until it finally reached the federal level. And a few summers ago, President Biden actually really brought it to the federal level when he issued an executive order calling on the Federal Trade Commission to investigate these right to repair restrictions. We've seen the Federal Trade Commission now has been filing suit against a variety of OEMs, not necessarily in our space, but Harley-Davidson, Weber, Grills on the right to repair issue. And so the FTC has certainly gotten a lot more aggressive after this Biden executive order. But really, Biden, given his visibility, really raised this at the federal level. And subsequent after that, we saw multiple bills introduced in the last Congress. The bills had several of them received bipartisan support. We had an ag specific bill, a very broad right to repair bill, which applied everything from consumer electronics to equipment. And we had another bill that was a little more limited to kind of the copyright issues surrounding right to repair. But at the end of the day, they all wanted access to the embedded software and the source code. Many of them were bipartisan supported on a bipartisan basis, which we'll talk about a little bit about because it really, this issue kind of transcends politics in many ways. And it really taps into kind of this populist strain that's running through both Democrats and Republicans in terms of going after kind of big business, going after the big guy sort of thing. And so it's really become, it's not a, we've always in the business community, we used to rely very much on the Republicans to kind of bail us out and help us out and see the pro business kind of arguments and in things. And that's just not the way it is anymore, particularly around this issue. So last year, right to repair legislation passed for the first time in Colorado as well as New York. Now the Colorado bill was targeted just to wheelchairs, so electronic wheelchairs. So similar situation in terms of being accessed to parts, as well as requiring diagnostic information and any codes and that sort of thing, embedded software that are on wheelchairs. So that passed with wheelchair, with wheelchair only in Colorado. And I mentioned this, cause we'll talk a little bit about what's going on in Colorado right now in a little bit. And New York passed a very broad right to repair bill that applied to, again, just, just about everything that has software, embedded software on it, digital electronics, and which included, it would have included off-road equipment, but we were able to secure an exemption. This particular exemption is an amendment that we've been shopping to really every state that has a right to repair bill out there. And I'll bring up this language here and I'm going to be reading a little more off slides than I like to, but I think it's important to get the details. So this is the off-road amendment that New York secured, which basically exempted most heavy equipment from the bill. Manufacturers, distributors, importers, or dealers of all off-road, non-road equipment, including without limitation, farm and utility tractors, farm implements, farm machinery, forestry equipment, industrial equipment, utility equipment, construction equipment, compact construction equipment, road building equipment, mining equipment, turf yard and garden equipment, outdoor power equipment, portable generators, marine, all-terrain sports, and recreational vehicles, including racing vehicles, standalone or integrated, stationary, mobile, and internal combustion engines, other power sources, including without limitation, generator sets, electric battery and fuel cell power, power tools, and any tools, technology attachments, accessories, components, and repair parts for any of the foregoing. So this was all exempted out of the New York bill. And again, this is kind of what we use as a model as we're going around the country in encouraging state legislators who are looking at this issue to exempt our industry. So who are the proponents of these bills? I get asked this a lot. It's very much driven by consumer groups. Public interest research group is one, Consumer Reports. These folks claim to advocate on behalf of consumers, and they are really driving it. There's a website repair.org where they obviously have a lot of resources behind the effort. It's also being driven by third-party repair providers as well. You see that particularly on the personal electronics, these pop-up shops or these shops that repair cell phones and other consumer electronics are really pushing this as well. You have the National Farmers Union. You may have seen the MOU that occurred between John Deere and the Farm Bureau, as well as CNH and the Farm Bureau. Well, that Farm Bureau is a different organization than the National Farmers Union. And National Farmers Union has very much been driving this in various states. And despite the MOU with the Farm Bureau, the Farmers Union continues to push for right-to-repair policies. Prominent lawmakers, including Bernie Sanders and Elizabeth Warren, they featured this right to repair in their presidential platform when they ran back in 2020. And so it's among those folks, those kind of progressive, more I guess democratic socialist types. It's a very popular idea. But like I said, it's not necessarily just a democratic idea. It really is resonating as well on the Republican side. And the trial lawyers like it. There's a lot of kind of opportunities in these bills to bring suit against dealers and OEMs who may not be complying with the legislation. And so the trial lawyers see this as an opportunity to bring many more lawsuits against the business community. So who's opposing it? Most of the business community is opposing it. Everyone from the U.S. Chamber and National Association of Manufacturers to, of course, AED and a lot of many, many distributor organizations. Many local user groups and unions have opposed this on the state level. So we've been working closely with, say, the AGCs of the world and some of the other construction contractor groups, as well as the International Union of Operating Engineers. They've been very helpful, particularly in union states and pushing back for the safety concerns that right to repair legislation has. And again, that's been more at the local level. We've been tapping into the user groups in the unions. Intellectual property organizations generally have opposed these efforts. Again, you're giving up a lot of software source code and things that are very proprietary or these bills mandate the open access to those. And so intellectual property organizations have been pushing back. Lately, we've been able to engage more of the legal reform groups. So the folks who want legal liability reform, again, going up against the trial lawyers who have also been getting involved in this battle. So it's two very distinct groups, I guess, against each other. And there's definitely stakeholders on both sides of this issue. So as you can see, the rights repair effort has been proliferating across the United States. And right now there's 44 bills being considered in 25 states. We expect more to be introduced and more to be considered here as state sessions kind of continue on. But really it's, as you can see, the red indicates bills that are introduced are currently active. That doesn't necessarily mean that we think they're gonna pass, but they are out there. And then the blue states are ones that we've defeated or the industry is exempt. And so that's kind of where we are, the lay of the land here in terms of how this is spreading. This certainly has momentum and it's been kind of an uphill battle for us pushing against this legislation state by state as well as at the federal level. So I'm gonna go through four different states that we believe are big threats right now for this passing and kind of go through. Every state, I get asked a lot, well, what's right to repair? What's it look like in this state or that state? It really, it depends. Each state has their own flavor. You've really got to dive into the language. Some apply just to ag equipment. Some apply broadly to every piece of anything with electronics associated with it or onboard computer systems. Some apply to ag and forestry. Some apply to ag, forestry and construction. So it really depends and they all have different requirements. So the devil really is in the details in a lot of these states. So Colorado. Colorado is, I mean, I think at this point they will certainly pass a right to repair bill that applies to ag equipment. The House and Senate in both in the Colorado have both passed right to repair bills. The Senate bill differs a little bit from the House bill. And so they are trying to kind of work on a final bill. We'll see if they make any changes but Colorado will have a right to repair bill by the end of this legislative session. The governor there has agreed, already said he will sign it. So let's first get to, so it's targeted agriculture equipment. Let's get into a little bit about what agriculture equipment, how they define that in this bill. Ag equipment is primarily, it means equipment that is primarily designed for use for, sorry, let me, for use in a farm or ranch operation. Agriculture equipment includes a tractor, trailer, combine, sprayer, tillage, implement, baler and other equipment used to plant, cultivate or harvest agricultural products or to ranch and attachments to and repair parts for equipment described in what I just mentioned. So really anything that could maybe be used on a farm could be considered in this definition. But the one thing to remember, even if you're say you think you sell just construction equipment, that's great. It might not be included in this, but as we saw in Colorado, they originally passed a wheelchair right to repair bill last year. This year they're poised to pass this agriculture equipment bill. I mean, what's next construction? Is it, where do we go from here? And so this is why we get so concerned when any of these bills pop up and we really do kind of try to defeat these bills in all their form. This bill requires OEMs to provide data, parts, embedded software tools or firmware to customers and third-party repair providers. And then this is where we get into somewhat what I mentioned before on the part side of things. So this legislation requires OEMs to sell parts at fair and reasonable terms and costs with respect to ag equipment from the manufacturer dealer means that parts shall be sold to an owner or independent repair provider under equitable terms for access to a receipt of any part pertaining to ag equipment at a cost that is no greater than the manufacturer's suggested retail price. So this is actually more generous than we've seen in some bills out there, but it still is price setting by the government on what you can sell parts for. Extremely problematic, obviously, to dealers and their business model. And really it's very concerning that the government will be kind of determining or controlling how what you can sell, what costs you can sell parts for to your customers and independent repair providers. As I said, this bill looks like it's moving forward. It also does allow, it does require OEMs to give customers to be able to disable the security lock on the machine as well. So there's a lot of problems here, obviously, not just economic, it gets into the environmental side, the safety side of issues, and so liability issues. So there's a lot of concern here with this Colorado bill. I get asked, been asked recently what do you do as a dealer of ag equipment in Colorado? And I think really just wait and see. I mean, we have to see how, first of all, what exactly comes out of the legislator there. We think they're kind of near a final bill, but there still could be opportunity. There's some slight opportunity to change it a bit, but also how Colorado actually implements this. And that will, how broadly they read into agriculture equipment and how they enforce this legislation, but obviously very concerning. Colorado is on the kind of the final stages in passing the first kind of off-road equipment focused right to repair bill in the country. So then we go over to Vermont, a very small state that is occupying a lot of those of us who are battling these bills that are time. So Vermont has what they call the Fair Repair Act that applies to ag and forestry equipment. Now we've seen this kind of strategy. We saw it earlier this year in West Virginia where they tacked on forestry equipment to an ag equipment, an ag focused right to repair bill. And so this is a strategy that certainly we're seeing now by the advocates for this legislation across the country. And so ag equipment means a device, part of a device or an attachment to a device designed to be used principally for an agricultural purpose, including a tractor, trailer or combine, implements for tillage, planting, cultivation and other equipment associated with livestock or crop production, horticulture or floriculture. Again, fairly broad and really gives a great deal of I think leeway to the executive to then enforce these particular on what actually is ag equipment. And then, like I said, forestry equipment means non-divisible equipment, implements, accessories and contravances used directly and principally in cutting or removing timber or other sold wood forest products, including equipment used to construct, maintain or install infrastructure necessary to and associated with a logging operation. So again, a fairly broad definition there of what could be forestry equipment. It could again encompass what we may not traditionally think as forestry equipment. The bill does require that OEMs give parts, tools and documentation for all repairs to customers and third-party repair writers. And then it takes a slightly different kind of approach to the parts issue than Colorado and some of the other states. It says, the cost for parts must be costs that are fair to both parties considering the agreed upon conditions, promise quality and timeliness of delivery. Fair and reasonable costs are subject to statutory and regulatory limitations. So now we're on a fairness standard. They don't define what is fair, at least in this bill. They don't define what's reasonable in this bill. And so really left up to Vermont and given the senators that Vermont has produced and over the years, I'm not sure that we wanna give that much leeway to any policy makers in Vermont to determine what the cost of a part should be. And so again, this is why this parts language gets really so concerning to us at AED. So moving on to Missouri, and this also is a good indication. So we talked about Colorado, which generally is considered a democratic state. We talked about Vermont, which is generally kind of a democratic socialist type state, but now we're in Missouri, which is considered a very deep red state and they are moving forward with a right to repair bill as well. We expect a hearing at the end of the month. And this bill is one of the broader bills we found throughout the country in terms of how it applies to equipment. Missouri is considering their bill, which applies to all farm machinery, construction machinery, and forestry machinery, regardless of the date purchased, whose functioning depends in whole or in part on embedded or attached digital electronics. So really every piece of farm equipment, construction equipment, and forestry equipment. The Missouri bill also requires, again, that OEMs and dealers give up turnover tools, documentations, disabled security locks when asked. And so a pretty broad bill here that implicates really all the concerns we have with these right to repair bills. And the bill does require that parts be sold using this criteria, the net cost to an authorized repair provider for similar parts, documentation or tools obtained from the manufacturers, less any discounts, rebates, or other incentive programs. Fair and reasonable terms are an equitable price in light of relevant factors, including but not limited to the costs of the manufacturer for preparing and distributing the parts or product, excluding any research and development costs incurred in designing and implementing, upgrading or altering the product, but including amortized capital costs for the preparation and distribution of the parts, and see the price charged by other manufacturers for similar products or parts. I mean, extremely problematic language there as it relates to parts. And of course, we're pushing back strongly on this bill introduced by a Republican. Again, the Republic of Missouri state legislature is dominated by Republicans, and we're gonna be pushing back against this, but really a concerning bill out there in Missouri that really does have a decent shot of passing this session unless we really push back against it. And now getting on the Florida. So Florida actually has a pretty interesting bill. They actually just passed it out of their Senate Ag Committee yesterday. They're considering what they call the Agricultural Equipment Fair Repair Act, which is applicable to digital electronic equipment or a part for such equipment, which is originally manufactured for farm equipment, including combines, tractors, implements, self-propelled equipment, and related attachments and implements, and which is manufactured for distribution and sale in the state in Florida. So this actually is a fairly narrow definition of what I would call ag equipment. If it's originally manufactured for farm equipment, I guess, or for farm use, I guess it's, how do you get to the original 10 of something that's been manufactured could be an issue, but it's a relatively narrow definition, very specific, I should say, definition of what actually is ag equipment. And also it doesn't get into the parts as much as it gets into the repair information. The original OEM shall make available diagnostic and repair documentation, including repair technical updates and updates and corrections to embedded software to any independent repair provider or owner of equipment manufactured by such original equipment manufacturer. The information must be made available for no charge or provided in the same manner as the original of the OEM makes such diagnostic and repair documentation available to an authorized repair provider. So really again, more focused on the diagnostic and repair documentation than the parts issue, still broad safety and environmental concerns with this particular legislation, but a little more of a narrow approach. And again, introduced by a Republican in Florida. Florida, I think it's safe to say these days is a red state. And yet this bill is moving forward. It was passed out of committee yesterday, eight or nine to zero, despite a number of witnesses from dealerships testifying against it. So definitely moving through the Florida Senate here. And so I think, you know, what I've basically showed you are four different bills and there's about 21 more out there in various states that also are very different from this, but it kind of gives you a flavor for what's out there. And again, these four states, we really do consider to be the biggest threat. You throw in Massachusetts, which usually their legislator doesn't get moving until toward the end of the spring. But we've got, you know, our hands full here battling these four or five bills. And again, and then there's other states, Ohio has a bill out there as well that we're tracking closely and really many other states have these. So it kind of gives you a flavor for what we're battling out there. We are, it's a National Ag Day statement. Now this just came out this morning, and this again shows you how much of a priority this is for even President Biden. It says, quote, we are working to secure the so-called rights repair so farmers can fix their own machinery and tractors rather than being required to send them back to the manufacturer. That was just put out this morning in President Biden's National Ag Day statement. So a big focus of this administration, a big focus of many in Congress, a big focus at the state levels as well. And really when the president puts his name behind it, whether you like him or not, whether you agree with him or not, it gives a lot of kind of validity to the efforts, particularly as you're moved down the line to the states and localities. Oh, there we go. So what is AED doing to combat rights repair? We're educating policy makers about the safety, environmental, liability, intellectual property, and economic problems with these proposals. We're coordinating with a broad coalition of distribution tier organizations, OEMs, and interested parties. Really, this is one of those issues where we've worked together with just about every OEM and particularly every OEM with a government affairs office to battle these bills. Again, like I mentioned, we work with other interested parties such as customer groups in fighting back as well, as well as labor unions at the state, particularly at the state level. We've been activating our dealers to participate in state level meetings, testify, and contact state legislators, as well as hosting state legislators and members of Congress in their facilities to show the complexity of the equipment, but also show what you do provide to your customers as far as diagnostic tools, parts, and service information. And then we've been invited, we last year, our chairman at the time, Ken Taylor, what testified before Congress on the impact of right to repair on AD members. Again, it shows that Congress had their first ever right to repair hearing. Last year, AD was invited to testify, but again, it's showing the momentum behind this effort and the need for all dealers to be engaged both at the federal level as well as at the state level. And I'd like to finish off here by showing this video of Ken Taylor, again, our chairman last year, his opening statement before the House Small Business Committee, because I think it really does sum up the arguments that we have in our favor and the way that if, as you're going around to your state legislators, as you're coming to DC or talking to members of Congress, this is kind of really the argument, the arguments, and I think he puts it in a very succinct and very clear way, our opposition to these bills. And so I'm gonna play this, it's about five minutes, six minutes long, and then I will answer, take a quick look at what we're doing going forward, and then I'll take some questions, so. I believe that our third witness up in Northern Maine has technical difficulties, so we're gonna go ahead and recognize you, sir. Chairman Golden, Ranking Member Tenney, and other distinguished members of the subcommittee, it is an honor to appear before you today, both as Associated Equipment Distributors 2022 Chairman, and as President of Ohio Machinery Company. AED is the international trade association representing independent companies that sell, rent, and service equipment used in many applications, including construction, agriculture, forestry, energy, mining, material handling, and industrial production. Ohio Machinery Company was founded in 1945, and I am the third generation from my family to run the business, following both my father and my grandfather. Right to repair is a simple slogan. However, the policy proposals surrounding the issue are complex with significant consequences. At the outset, I want to make it clear, AED members support customers' right to repair their machinery, and distributors make available diagnostic tools, repair information, parts, and remote customer support. Idle, non-functioning equipment equals lost time and money. Whether it's on a farm during harvest, or on a road building project, there's absolutely zero incentive to not do everything we can as equipment dealers and manufacturers to keep a machine running. That can mean repairs completed by a dealership service technician, the customer, or a third-party provider. The equipment industry is highly competitive, and if Ohio Machinery Company isn't providing proper and timely service, nothing is stopping the customer from moving to one of my many competitors and their products. However, we don't support unfettered access to critical onboard software and information pertaining to environmental and safety protections or key operational functions, which is what proposals in various states and Congress would do. The tractors we're selling today are not the same as those sold by my grandfather or even my father. While customers can complete most repairs to their machinery, government environmental and safety regulations, as well as technological developments that have made equipment more efficient and productive, necessitate restrictions in access to source code and software that ensure key operational functions aren't modified or disabled. Right-to-repair legislation currently being considered in Congress will completely alter the equipment industry's distribution model. Manufacturers of equipment rely on a network of independent, mostly family-owned, small-to-medium-sized companies to sell, rent, and service the equipment. These dealers make significant investments in their employees, including training service technicians to repair and maintain the latest high-technology machinery. Many AED members' facilities are located in rural and underserved areas, creating well-paying careers and economic opportunity. Equipment dealers also invest extensive capital in parts inventories to ensure repairs and maintenance can occur as soon as possible. Out-of-service equipment isn't merely an inconvenience. It can ruin a farmer's harvest or delay completion of a bridge or roadway. However, right-to-repair proposals require original equipment manufacturers to sell parts and diagnostic tools directly to the public at cost, without profit, completely circumventing the equipment dealer. Aside from effectively dismantling the equipment distribution industry's aftermarket parts business, and thereby putting many equipment dealers out of business, logistically, it is impractical and would only exacerbate inflationary pressures in the equipment market and create long delays in parts availability. For many equipment dealers, parts revenue produces the majority of income for the business, though parts margins are far from inordinate. If parts are required to be provided at cost, many dealers would be put out of business. Anyone can walk into an AED member facility or go online and buy OEM parts for their equipment. There's no restriction on who can purchase parts, whether it's an equipment owner, a third-party service provider, an equipment operator, or a member of the general public. However, there will be no incentive for an equipment dealer to carry parts inventory if the manufacturer or the dealer is forced to sell parts without the ability to make profit. For the equipment industry, right-to-repair proposals are a solution in search of a problem. AED members provide customers and third-party repair providers with parts, tools, and other resources to complete the overwhelming majority of equipment repairs. Enacting these proposals will stifle entrepreneurship, and the result will be an unprecedented intrusion by government into the free enterprise system. I reflect on my grandfather and the reasons he got into the equipment distribution industry. He was looking for a better life for his family, the opportunity to create well-paying jobs and careers for his employees, and the privilege of giving back to the community, including in underserved areas like Appalachia. Most equipment dealers have similar stories because the United States allows entrepreneurs to pursue their dreams. Unfortunately, I worry that should these right-to-repair policies become law, the viability of the equipment distribution industry will be severely hampered, resulting in lost economic activity, job creation, technological advancements, and a less competitive America. Chairman Golden, Ranking Member Tenney, and members of the subcommittee, thank you for the honor of appearing before you today. I look forward to answering any questions you may have. Well, so like I said, I think Ken did a great job of kind of, in a very concise manner, and explaining what kind of the arguments are on the equipment side against these type of right-to-repair policies. So with that, I see there are a couple of questions out there, and I will, is it appropriate to call out the Missouri state legislator who introduced this bill, or introduced the bill in Missouri? I don't think it's publicly available. The legislator's name is Representative Hovis, H-O-V-I-S. What is the status in Oklahoma and Texas? Oklahoma and Texas both do have right-to-repair bills out there, but at this point, we don't really view them as a, their passage as a significant threat. So while we're certainly keeping our eye out on them, and we don't anticipate them really receiving any traction in Oklahoma or Texas. Regarding Colorado, it is my understanding that lawmakers agreed to either amend or remove the parts language. However, things were moving quickly, and the amendment was made, but the original language remains, which created a significant contradiction within the legislation. Can you provide clarity on this question? I am unaware of that lawmakers had agreed to remove the parts language. They may have possibly agreed to amend it, but I think where we stand right now is that, again, two different bills have passed the House and Senate. We're hoping that they do do a conference committee where they would reconcile the differences between the two bills, and hopefully would be able to provide some clarity on not just the parts language, but other provisions in the bill, which really were kind of slapped together and inartfully written. But at this point, we've also heard that they may be just gonna just pass the bill that passed the Senate last week. So I think, I guess, that might not provide clarity because there's just not a lot of clarity out there in terms of how Colorado will proceed, but certainly will inform particular members in Colorado as that process continues to move forward and AED continues to engage on that issue in Colorado. Federal legislation on right to repair. So, so far we have not, we don't have any legislation introduced at the federal level. And so, which is, I guess, good for now, but we certainly anticipate definitely an ag equipment right to repair bill. Senator Tester from Montana, Democrat has made this a priority of his and he's running for reelection. So we anticipate him introducing that bill again. Unlike last Congress, we think there'll be a House companion bill. To that, we also would expect, there's Congressman Joe Morelli from New York, who was leading the New York effort when he was in the General Assembly. And he has introduced a broad right to repair bill in the past. We certainly expect him to reintroduce that again in Congress as well. So we are, while Congress isn't, there's no bill out there on the federal level at this time, we are certainly expecting that to change in the near future. As I think about parts being sold at cost, it would not be required for an all makes parts supplier or online suppliers. They would pick up the business from dealers not willing to sell parts at costs. I'm not sure. I believe that would be true. So I think if you're referring to just an aftermarket parts supplier, I believe they would pick up the cost if they're selling non-OEM parts. I'm assuming, Steve, we can talk offline about that if I didn't answer your question or I don't fully understand it. Got a question about Kansas. Kansas is not a threat right now to pass a right to repair bill. Are AD or any other organizations working on a proactive national solution to the right to repair issue that would give each side a win and protect our parts pricing? There's certainly been discussion of that. I think that as more states move in this, kind of move towards passing these bills that it will necessitate a national solution. But the problem always with going nationally is that it takes a while. So Congress, unlike these states where they, I found they can introduce a bill, pass a bill, and have it to the governor in about a week's time and have a committee hearing on it all in about a week. At the federal level, this takes a lot longer. But I mean, I do think as we start moving toward seeing more states pass these bills that we might be looking toward a federal solution that would preempt these state bills that have been passing. Are the defeats at Iowa and South Dakota considered final or do you expect different versions to reemerge? I mean, I do expect finals only as good as, I guess defeats are only, and wins are only as good as the legislative session. This thing's building momentum kind of across the country. And so I certainly would anticipate any state that's dealt with a right to repair bill in the past to be introduced again at some point. I think more specifically about Iowa and South Dakota, I do believe that there hasn't been kind of that, that as much momentum behind those bills as in other states. Is there a list of states that have approved right to repair laws that have a direct impact on the equipment engine industry? There's not a list of states because at this time there is not a state that has approved a right to repair bill that would have a direct impact on the equipment and an engine industry. At least on the engine side, there is one that could, I think Massachusetts could be an issue there, but on the equipment side, Colorado will be the first state to pass a equipment specific right to repair bill when they do so as expected here in the next couple of weeks. Yeah, so if you sell the same piece of equipment to both ag and construction end users, how might that affect the business requirements where only one of those is listed in the bill? This is a point that we make to lawmakers, policy makers, as well as to many, or others, and especially also to dealers who might say, oh, well, that's an ag bill, we only sell construction equipment or that's construction bill, we only sell ag equipment. I mean, it really will be kind of how it's implemented at the end of the day, how that impacts kind of whether, you've seen some of the definitions, they say if it's at all used on a farm, well, that could be really, it could be a backhoe, it could be an excavator. I mean, you see those on the farm all the time, or if it's manufactured specifically for farm use, that again, could be, might be more narrow. So this is kind of the issue with these definitions in that, as we know, the equipment industry sells many times to both ag and construction end users. Oklahoma is, as I mentioned, there is a bill out there, but we don't expect it to move. As far as Illinois goes, so Illinois was an interesting state, and I think what happened there was really the involvement of the dealers who really pushed back this, it had momentum in past sessions, and this year it's really, no one's really willing to touch it. We kind of made it a very, the dealers really made it a very toxic issue in Illinois. So while Illinois really, we don't even view as a threat, those of you may remember who live in Illinois, from the past, Illinois was actually on the top of the list of states that we were very worried about. But I think again, years and years of kind of bringing dealers to the state house, hosting legislators at our dealer facilities to show them the complexity of the equipment, what we already provide to our customers, kind of the unnecessary nature of these provisions have really taken Illinois at least off the map in the current, at least this year. So with that, we are about out of time. Of course, you can always reach out to me if you have any other questions. These are very fast moving situations. So when you hear either, or when you've received an email or a call from either myself or your regional manager, I'd ask you to please take that call. If we're calling you to ask you to testify or submit written testimony, we're doing it because it's important. And these bills passing are of course a great threat to this industry. So we're gonna keep battling, but we need your help. And so we'll be calling on all of you, both at the state level, as well as the federal level when we have that legislation introduced. So with that, thank you all for joining. Thank you for the participation. Thank you for your support of AED. The recording will be circulated to all registrants and have a great rest of your day.

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