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Business Operations

News from the Industry

October 11, 2010
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Over $770,000 in fines during CA sweeps
Over 230 inspections in 29 California counties yielded $770,000 in fines to carwash businesses for labor law violations during a statewide sweep conducted on April 29 and 30.

Of the 88 employers inspected, 66 failed to register or renew registration of their carwash business with the state, as per a recently extended law.

In addition to the registration violation, 44 carwashes failed to carry workers’ compensation insurance. Other violations included:

  • Cash payment versus itemized wage deduction statement/pay stub;
  • Failure to pay minimum wage; and
  • Failure to provide work permits for minors.

“Our efforts are directed at illegally operating carwash businesses as part of the underground economy,” said California Labor Commissioner Angela Bradstreet. “These underground operations do not provide the protection workers are legally afforded, have a negative impact on our state’s economy and an unfair advantage over competitors who do follow the law.”

CA may extend carwash registration law
California has taken the first step towards making the state’s Carwash Worker Law (also known as the California Car Wash Registration Program) a permanent regulation after the Assembly Committee on Labor and Employment passed AB 236 in a 6-1 vote.

AB 236 will now move to the Committee of Appropriates and, if passed, onto a vote by the full Assembly. Without the bill, the Carwash Worker Law would expire on December 31, 2009.

The California Carwash Worker Law went into effect on Jan. 1, 2004 when AB 1688 was passed in the aftermath of a television station’s undercover investigation of Los Angeles carwashes. Under the law, carwashes are required to register with the state and to document their payroll, and workers may file wage and/or retaliation claims with the Labor Commissioner when their employers violate employment laws. The law was extended in 2007 when SB 1468 was passed.

Carnett’s will become Mr. Clean by August
By August, fourteen of the 17 Carnett’s carwash locations should be fully branded as Mr. Clean Car Washes.

Carnett’s signed an agreement to partner with Mr. Clean Car Wash to form a national franchise earlier this year. Bruce Arnett, Sr., owner of the Carnett’s chain, now serves as the new company’s CEO and his son, Bruce Arnett, Jr., is its COO.

"We've always wanted to go nationwide, but our problem was that while our brand is very well known in Atlanta, people in other parts of the country haven't heard of us," Arnett said.

Arnett continued, "Procter & Gamble is getting into the franchise business and the service business on a large scale and the Mr. Clean Car Wash is the first of several projects that the company is rolling out. This is something they worked on for three years."

Jeff LeRoy, external relations manager for Procter & Gamble, explained that Carnett's was brought into the deal because of the company's expertise in carwash operations.

"If you're going to launch nationally, Procter & Gamble knows marketing and we've done the all research, but what do we know about carwashing? Here are the Arnetts with something like 30 years of experience so bringing them in was a tremendous asset to this."

Teenagers protest working conditions at L.A. carwashes
A new and surprising group has joined the voices protesting work conditions at L.A. carwashes: 12th graders.

The group of students from Wildwood School gathered in Los Feliz, CA, along with members of the Community-Labor- Environmental Action Network (CLEAN), to highlight unsafe working conditions in the carwash industry which they believe are widespread.

The students are studying human rights in school and raised money to purchase safety equipment for the workers, including safety goggles, rubber gloves, and face masks. The equipment was presented to workers at Vermont Hand Wash, the carwash which recently racked up several serious charges by California OSHA.

EPA: Public doesn’t realize dangers of home carwashing
The Environmental Protection Agency believes most people do not understand why home carwashing is bad for the environment. According to an EPA statement, “Many people do not associate the effects of washing their vehicles with local water quality and may be unaware that the discharges that enter storm drains are not treated at plants before being discharged into local waters.”

The EPA said detergent-rich water from home carwashing flows into local storm drains and can contain high amounts of nutrients, metals and hydrocarbons.

Home carwashing also wastes an extra 90 or so gallons of water as compared to a professional carwash service.

Home carwashing restricted across the U.S.
Water shortages across the United States are forcing many municipalities to restrict water use, including home carwashing.

State 1 drought restrictions went into effect on Tuesday, April 28, in San Marcos, TX, where residents can now only wash their vehicles at home one day per week. Home washing must also be done using either a hand-held bucket or a hand-held hose equipped with a positive shutoff device.

In California, another 10 water districts instituted some form of mandatory rationing this May, bringing the total number to 30 water districts in the State. Many districts are urging customers to curb water consumption by 10 or 15 percent, while others are restricting certain uses, such as landscape irrigation or home carwashing.

At-home carwashing is now banned in Tampa, FL, an area within a state that has been dealing with the drought and low water levels for three years now. New water restriction rules have also been imposed by the Southwest Florida Water Management District in the Pinellas, Pasco and Hillsborough counties.

And, across the ocean, U.S. bases in Okinawa, Japan, are also following a water restriction plan after unusually low water levels have forced officials at Kadena Air Base to ban home carwashing.

Five Quick Quack sites up for sale/leaseback
Five Quick Quack Car Wash locations in California are available for sale/leaseback. Operators traditionally use leaseback opportunities to raise capital and Quick Quack has previously said it intends to grow its 13-strong carwash chain with locations in Texas, Colorado and California.

The five sites, found in Folsom, Sacramento, Rancho Cordova, North Highlands and Citrus Heights, CA, are listed for $18.2 million.

The leases are 20-year absolute-net leases with two percent annual increases.