Legislative efforts in California, Illinois and New York that seek to crack down on reserve income were announced in recent months. To date, the measures have either been mitigated or are making little progress.

California bills that sought to cap markups at $150 per loan were significantly weakened, reported Automotive News. The revised legislation lets dealers charge a fee for arranging financing as long as the charges are consistent and fully disclosed.

In New York, Attorney General Eliot Spitzer said in March that he was introducing legislation to require flat-rate markups and full disclosure. "The legislation has never been introduced in either (legislative) chamber," Bob Vancavage said. According to Vancavage, president of the New York State Automobile Dealers Association, Spitzer never actually proved there was discrimination in dealership financing.

Illinois Attorney General Lisa Madigan wants to force dealers to disclose both buy rates and sell rates. But no legislative committee has yet backed her bill, according to Eric Higgins of the Chicago Automobile Trade Association.

Louisiana is also considering a moderate finance reserve-related measure. House Bill 555 seeks a 3 percent cap on markups and to require disclosure that the dealer may be compensated for financing. The House Committee on Commerce considered it in April.