BILL NUMBER: AB 2592 CHAPTERED
BILL TEXT
CHAPTER 790
FILED WITH SECRETARY OF STATE SEPTEMBER 29, 2006
APPROVED BY GOVERNOR SEPTEMBER 29, 2006
PASSED THE ASSEMBLY AUGUST 31, 2006
PASSED THE SENATE AUGUST 29, 2006
AMENDED IN SENATE AUGUST 24, 2006
AMENDED IN SENATE AUGUST 23, 2006
AMENDED IN SENATE JUNE 8, 2006
AMENDED IN SENATE JUNE 5, 2006
INTRODUCED BY Assembly Member Leno
FEBRUARY 24, 2006
An act to add Section 1936.01 to the Civil Code, to amend Sections
13995.40, 13995.49, 13995.65, and 13995.77 of, to amend, repeal, and
add Sections 13995.20 and 13995.60 of, and to add Sections
13995.40.5, 13995.64.5, 13995.65.5, and 13995.92 to, the Government
Code, and to add Item 0520-495 to Section 2 of the Budget Act of 2006
(Chapter 47 of the Statutes of 2006, as amended by Chapter 48 of the
Statutes of 2006), relating to California tourism.
LEGISLATIVE COUNSEL'S DIGEST
AB 2592, Leno California Travel and Tourism Commission.
(1) Existing law, the California Tourism Marketing Act, provides
for the California Travel and Tourism Commission, a nonprofit mutual
benefit corporation, and provides for a 37-member board of the
commission, including the Secretary of Business, Transportation and
Housing, 12 members appointed by the Governor, and 24 elected
members. The 12 appointed members are required to represent the 12
officially designated tourism regions.
This bill would specify that each appointed member of the
commission shall represent only one of those designated tourism
regions. The bill would also specify that appointed members are not
limited to persons who are employed by or represent assessed
businesses. The bill would provide that elected commissioners shall
serve 4-year terms and that an appointed or elected commissioner
would cease to be a commissioner 90 days following the date on which
he or she ceases to meet the criteria for appointment or election as
a commissioner, except as specified.
(2) Existing law authorizes the commission to accept voluntary
assessments from any person in a travel and tourism related business,
except persons whose primary business is gaming.
This bill would delete that exception.
(3) Existing law establishes procedures for imposing assessments
on businesses within various tourism industry categories or segments
by means of referendum called by the Secretary of Business,
Transportation and Housing. Existing law exempts from assessment a
small business, defined as a business location with less than
$1,000,000 in California gross annual revenue.
This bill would require the secretary to identify, if possible and
provide an opportunity to vote to, businesses that would be newly
assessed due to a referendum, and would set forth specified methods
by which a business or person sharing common ownership, management,
and control of more than one assessed business may calculate the
assessment. The bill would also allow the exemption threshold amount
to be lowered to not less than $500,000 by referendum.
This bill would require the commission to submit a referendum to
the passenger rental car industry as soon as possible, but not later
than March 31, 2007, proposing an assessment level, as specified,
upon the passenger rental car industry, as an industry category, for
the 2006-07, and 2007-08 fiscal years. The bill would require the
commission to report to the secretary if the referendum and
assessment rates are agreed to. The bill would require the secretary
to provide notice of that agreement to the Legislature and the
Secretary of State and to post notice on its Internet Web site.
The bill would make other changes relating to elections of
commissioners, voting rights, and assessments that would be operative
only if the referendum submitted to the passenger rental car
industry, and assessment rates, as specified, have been agreed to.
(4) Under existing law, a passenger vehicle rental company is
required to only advertise, quote, and charge a rental rate that
includes the entire amount except taxes, a customer facility charge,
and a mileage charge, which a renter must pay to hire or lease a
vehicle for the period of time to which the rental rate applies.
Existing law prohibits a rental company from additionally charging
any fee that must be paid by the renter as a condition of renting the
vehicle.
This bill would require a rental company, in connection with the
rental of a passenger vehicle, to only advertise a rental rate that
includes the entire amount, except taxes, a customer facility charge,
and a mileage charge, that a renter must pay to rent a vehicle. The
bill would specify that when a rental company provides a quote or
imposes a charge, it may separately state the rental rate, taxes,
customer facility charge, airport concession fee tourism commission
assessment, as defined, and mileage charge. The bill would require a
rental company, imposing customer facility charges, airport
concession fees, or tourism commission assessments, to provide the
person receiving the quote with a specified good faith estimate. The
bill would also require a rental company, imposing these charges and
fees to clearly and conspicuously disclose, in the rental contract,
the specified total for the entire rental. The bill would authorize a
renter to bring an action against a rental company for specified
damages and equitable relief for a violation of these provisions. The
bill would make these provisions operative only if the referendum
submitted to the passenger rental car industry, and assessment rates,
as specified in (3) above, have been agreed to.
(5) The Budget Act of 2006 (Chapter 47 of the Statutes of 2006;
amended by Chapter 48 of the Statutes of 2006), appropriated to the
Secretary of Business, Transportation and Housing from the General
Fund certain amounts for support of its operations during the 2006-07
fiscal year, and allocated $7,300,000 of that amount for use by the
California Travel and Tourism Commission for promoting California
tourism to potential visitors.
This bill would amend the Budget Act of 2006 by reverting the sum
of $6,300,000 to the General Fund from the amounts allocated for use
by the California Travel and Tourism Commission if the referendum
submitted to the passenger car rental industry, as assessment rates,
as specified in (3) above, have been agreed to.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Section 1936.01 is added to the Civil Code, to read:
1936.01. (a) For the purpose of this section, the following
definitions shall apply:
(1) "Airport concession fee" means a charge collected by a rental
company from a renter that is the renter's proportionate share of the
amount paid by the rental company to the owner or operator of an
airport for the right or privilege of conducting a vehicle rental
business on the airport's premises.
(2) "Quote" means an estimated cost of rental provided by a rental
company or a third party to a potential customer by telephone,
in-person, computer-transmission, or other means, that is based on
information provided by the potential customer and used to generate
an estimated cost of rental, including, but not limited to, any of
the following: potential dates of rental, locations, or classes of
car.
(3) "Tourism commission assessment" means the charge collected by
a rental company from a renter that has been established by the
California Travel and Tourism Commission pursuant to Section 13995.65
of the Government Code.
(b) Notwithstanding subdivision (n) of Section 1936, the following
provisions shall apply:
(1) A rental company shall only advertise a rental rate that
includes the entire amount, except taxes, a customer facility charge,
if any, and a mileage charge, if any, that a renter must pay to hire
or lease the vehicle for the period of time to which the rental rate
applies.
(2) When providing a quote, or imposing charges for a rental, the
rental company may separately state the rental rate, taxes, customer
facility charge, if any, airport concession fee, if any, tourism
commission assessment, if any, and a mileage charge, if any, that a
renter must pay to hire or lease the vehicle for the period of time
to which the rental rate applies. A rental company may not charge in
addition to the rental rate, taxes, a customer facility charge, if
any, airport concession fee, if any, tourism commission assessment,
if any, and a mileage charge, if any, any fee that must be paid by
the renter as a condition of hiring or leasing the vehicle, such as,
but not limited to, required fuel or airport surcharges other than
customer facility charges and airport concession fees.
(3) If customer facility charges, airport concession fees, or
tourism commission assessments are imposed, the rental company shall
do each of the following:
(A) At the time the quote is given, provide the person receiving
the quote with a good faith estimate of the rental rate, taxes,
customer facility charge, if any, airport concession fee, if any, and
tourism commission assessment, if any, as well as the total charges
for the entire rental. The total charges, if provided on an Internet
Web site, shall be displayed in a typeface at least as large as any
rental rate disclosed on that page and shall be provided on a page
that the person receiving the quote may reach by following links
through no more than two Internet Web site pages, including the page
on which the rental rate is first provided. The good faith estimate
may exclude mileage charges and charges for optional items that
cannot be determined prior to completing the reservation based upon
the information provided by the person.
(B) At the time and place the rental commences, clearly and
conspicuously disclose in the rental contract, or that portion of the
contract that is provided to the renter, the total of the rental
rate, taxes, customer facility charge, if any, airport concession
fee, if any, and tourism commission assessment, if any, for the
entire rental, exclusive of charges that cannot be determined at the
time the rental commences. Charges imposed pursuant to this
subparagraph shall be no more than the amount of the quote provided
in a confirmed reservation, unless the person changes the terms of
the rental contract subsequent to making the reservation.
(C) Provide each person, other than those persons within the
rental company, offering quotes to actual or prospective customers
access to information about customer facility charges, airport
concession fees, and tourism commission assessments as well as access
to information about when those charges apply. Any person providing
quotes to actual or prospective customers for the hire or lease of a
vehicle from a rental company shall provide the quotes in the manner
described in subparagraph (A).
(4) In addition to the rental rate, taxes, customer facility
charges, if any, airport concession fees, if any, tourism commission
assessments, if any, and mileage charges, if any, a rental company
may charge for an item or service provided in connection with a
particular rental transaction if the renter could have avoided
incurring the charge by choosing not to obtain or utilize the
optional item or service. Items and services for which the rental
company may impose an additional charge, include, but are not limited
to, optional insurance and accessories requested by the renter,
service charges incident to the renter's optional return of the
vehicle to a location other than the location where the vehicle was
hired or leased, and charges for refueling the vehicle at the
conclusion of the rental transaction in the event the renter did not
return the vehicle with as much fuel as was in the fuel tank at the
beginning of the rental. A rental company also may impose an
additional charge based on reasonable age criteria established by the
rental company.
(5) A rental company may not charge any fee for authorized drivers
in addition to the rental charge for an individual renter.
(6) If a rental company states a rental rate in print
advertisement or in a telephonic, in-person, or computer-transmitted
quote, the rental company shall clearly disclose in that
advertisement or quote the terms of any mileage conditions relating
to the rental rate disclosed in the advertisement or quote,
including, but not limited to, to the extent applicable, the amount
of mileage and gas charges, the number of miles for which no charges
will be imposed, and a description of geographic driving limitations
within the United States and Canada.
(7) (A) When a rental rate is stated in an advertisement, in
connection with a car rental at an airport where a customer facility
charge is imposed, the rental company shall clearly disclose the
existence and amount of the customer facility charge. For the
purposes of this subparagraph, advertisements include radio,
television, other electronic media, and print advertisements. If the
rental rate advertisement is intended to include transactions at more
than one airport imposing a customer facility charge, a range of
charges may be stated in the advertisement. However, all rental rate
advertisements that include car rentals at airport destinations shall
clearly and conspicuously include a toll-free telephone number
whereby a customer can be told the specific amount of the customer
facility charge to which the customer will be obligated.
(B) If any person or entity other than a rental car company,
including a passenger carrier or a seller of travel services,
advertises a rental rate for a car rental at an airport where a
customer facility charge is imposed, that person or entity shall,
provided they are provided with information about the existence and
amount of the charge, to the extent not specifically prohibited by
federal law, clearly disclose the existence and amount of the charge.
If a rental car company provides the person or entity with rental
rate and customer facility charge information, the rental car company
is not responsible for the failure of that person or entity to
comply with this subparagraph.
(8) If a rental company delivers a vehicle to a renter at a
location other than the location where the rental company normally
carries on its business, the rental company may not charge the renter
any amount for the rental for the period before the delivery of the
vehicle. If a rental company picks up a rented vehicle from a renter
at a location other than the location where the rental company
normally carries on its business, the rental company may not charge
the renter any amount for the rental for the period after the renter
notifies the rental company to pick up the vehicle.
(9) Except as otherwise permitted pursuant to the customer
facility charge, a rental company may not separately charge, in
addition to the rental rate, a fee for transporting the renter to the
location where the rented vehicle will be delivered to the renter.
(c) A renter may bring an action against a rental company for the
recovery of damages and appropriate equitable relief for a violation
of this section. The prevailing party shall be entitled to recover
reasonable attorney's fees and costs.
(d) Any waiver of any of the provisions of this section shall be
void and unenforceable as contrary to public policy.
(e) This section shall become operative only if the Secretary of
Business, Transportation and Housing provides notice to the
Legislature and the Secretary of State and posts notice on its
Internet Web site that the conditions described in Section 13995.92
of the Government Code have been satisfied.
SEC. 2. Section 13995.20 of the Government Code is amended to
read:
13995.20. Unless the context otherwise requires, the definitions
in this section govern the construction of this chapter.
(a) "Appointed commissioner" means a commissioner appointed by the
Governor pursuant to paragraph (2) of subdivision (b) of Section
13995.40.
(b) "Assessed business" means a person required to pay an
assessment pursuant to this chapter, and until the first assessment
is levied, any person authorized to vote for the initial referendum.
An assessed business shall not include a public entity or a
corporation when a majority of the corporation's board of directors
is appointed by a public official or public entity, or serves on the
corporation's board of directors by virtue of being elected to public
office, or both.
(c) "Commission" means the California Travel and Tourism
Commission.
(d) "Elected commissioner" means a commissioner elected pursuant
to subdivision (d) of Section 13995.40.
(e) "Industry category" means the following classifications within
the tourism industry:
(1) Accommodations.
(2) Restaurants and retail.
(3) Attractions and recreation.
(4) Transportation and travel services.
(f) "Industry segment" means a portion of an industry category.
For example, rental cars are an industry segment of the
transportation and travel services industry category.
(g) "Office" means the Office of Tourism, also popularly referred
to as the Division of Tourism, within the Business, Transportation
and Housing Agency.
(h) "Person" means an individual, public entity, firm,
corporation, association, or any other business unit, whether
operating on a for-profit or nonprofit basis.
(i) "Referendum" means any vote by mailed ballot of measures
recommended by the commission and approved by the secretary pursuant
to Section 13995.60, except for the initial referendum, which shall
consist of measures contained in the selection committee report,
discussed in Section 13995.30.
(j) "Secretary" means the Secretary of Business, Transportation
and Housing.
(k) "Selection committee" means the Tourism Selection Committee
described in Article 3 (commencing with Section 13995.30).
(l) This section shall become inoperative on the date the
Secretary of Business, Transportation and Housing provides notice to
the Legislature and the Secretary of State and posts notice on its
Internet Web site that the conditions described in Section 13995.92
have been satisfied, and if the secretary provides those notices,
this section is repealed as of January 1, 2008, unless a later
enacted statute, that is enacted before January 1, 2008, deletes or
extends that date.
SEC. 3. Section 13995.20 is added to the Government Code, to read:
13995.20. Unless the context otherwise requires, the definitions
in this section govern the construction of this chapter.
(a) "Appointed commissioner" means a commissioner appointed by the
Governor pursuant to paragraph (2) of subdivision (b) of Section
13995.40.
(b) "Assessed business" means a person required to pay an
assessment pursuant to this chapter, and until the first assessment
is levied, any person authorized to vote for the initial referendum.
An assessed business shall not include a public entity or a
corporation when a majority of the corporation's board of directors
is appointed by a public official or public entity, or serves on the
corporation's board of directors by virtue of being elected to public
office, or both.
(c) "Commission" means the California Travel and Tourism
Commission.
(d) "Elected commissioner" means a commissioner elected pursuant
to subdivision (d) of Section 13995.40.
(e) "Industry category" means the following classifications within
the tourism industry:
(1) Accommodations.
(2) Restaurants and retail.
(3) Attractions and recreation.
(4) Transportation and travel services, other than passenger car
rental.
(5) Passenger car rental.
(f) "Industry segment" means a portion of an industry category.
For example, motor home rentals are an industry segment of the
transportation and travel services industry category.
(g) "Maximum assessment" means a dollar amount, adopted by the
commission, over which an assessed business shall not be required to
pay. The commission may adopt differing amounts of maximum assessment
for each industry category or industry segment.
(h) "Office" means the Office of Tourism, also popularly referred
to as the Division of Tourism, within the Business, Transportation
and Housing Agency.
(i) "Person" means an individual, public entity, firm,
corporation, association, or any other business unit, whether
operating on a for-profit or nonprofit basis.
(j) "Referendum" means any vote by mailed ballot of measures
recommended by the commission and approved by the secretary pursuant
to Section 13995.60, except for the initial referendum, which shall
consist of measures contained in the selection committee report,
discussed in Section 13995.30.
(k) "Secretary" means the Secretary of Business, Transportation
and Housing.
(l) "Selection committee" means the Tourism Selection Committee
described in Article 3 (commencing with Section 13995.30).
(m) This section shall become operative only if the Secretary of
Business, Transportation and Housing provides notice to the
Legislature and the Secretary of State and posts notice on its
Internet Web site that the conditions described in Section 13995.92
have been satisfied.
SEC. 4. Section 13995.40 of the Government Code is amended to
read:
13995.40. (a) Upon approval of the initial referendum, the office
shall establish a nonprofit mutual benefit corporation named the
California Travel and Tourism Commission. The commission shall be
under the direction of a board of commissioners, which shall function
as the board of directors for purposes of the Nonprofit Corporation
Law.
(b) The board of commissioners shall consist of 37 commissioners
comprising the following:
(1) The secretary, who shall serve as chairperson.
(2) (A) Twelve members, who are professionally active in the
tourism industry, and whose primary business, trade, or profession is
directly related to the tourism industry, shall be appointed by the
Governor. Each appointed commissioner shall represent only one of the
12 tourism regions designated by the office, and the appointed
commissioners shall be selected so as to represent, to the greatest
extent possible, the diverse elements of the tourism industry.
Appointed commissioners are not limited to individuals who are
employed by or represent assessed businesses.
(B) If an appointed commissioner ceases to be professionally
active in the tourism industry or his or her primary business, trade,
or profession ceases to be directly related to the tourism industry,
he or she shall automatically cease to be an appointed commissioner
90 days following the date on which he or she ceases to meet both of
the eligibility criteria specified in subparagraph (A), unless the
commissioner becomes eligible again within that 90-day period.
(3) Twenty-four elected commissioners, including at least one
representative of a travel agency or tour operator that is an
assessed business.
(c) The commission established pursuant to Section 15364.52 shall
be inoperative so long as the commission established pursuant to this
section is in existence.
(d) Elected commissioners shall be elected by industry category in
a referendum. Regardless of the number of ballots received for a
referendum, the nominee for each commissioner slot with the most
weighted votes from assessed businesses within that industry category
shall be elected commissioner. In the event that an elected
commissioner resigns, dies, or is removed from office during his or
her term, the commission shall appoint a replacement from the same
industry category that the commissioner in question represented, and
that commissioner shall fill the remaining term of the commissioner
in question. The number of commissioners elected from each industry
category shall be determined by the weighted percentage of
assessments from that category.
(e) The secretary may remove any elected commissioner following a
hearing at which the commissioner is found guilty of abuse of office
or moral turpitude.
(f) (1) The term of each elected commissioner shall commence July
1 of the year next following his or her election, and shall expire on
June 30 of the fourth year following his or her election. If an
elected commissioner ceases to be employed by or with an assessed
business in the category and segment which he or she was
representing, his or her term as an elected commissioner shall
automatically terminate 90 days following the date on which he or she
ceases to be so employed, unless, within that 90-day period, the
commissioner again is employed by or with an assessed business in the
same category and segment.
(2) Terms of elected commissioners that would otherwise expire
effective December 31 of the year during which legislation adding
this subdivision is enacted shall automatically be extended until
June 30 of the following year.
(g) With the exception of the secretary, no commissioner shall
serve for more than two consecutive terms. For purposes of this
subdivision, the phrase "two consecutive terms" shall not include
partial terms.
(h) Except for the original commissioners, all commissioners shall
serve four-year terms. One-half of the commissioners originally
appointed or elected shall serve a two-year term, while the remainder
shall serve a four-year term. Every two years thereafter, one-half
of the commissioners shall be appointed or elected by referendum.
(i) The selection committee shall determine the initial slate of
candidates for elected commissioners. Thereafter the commissioners,
by adopted resolution, shall nominate a slate of candidates, and
shall include any additional candidates complying with the procedure
described in Section 13995.62.
(j) The commissioners shall elect a vice chairperson from the
elected commissioners.
(k) The commission may lease space from the office.
(l) The commission and the office shall be the official state
representatives of California tourism.
(m) All commission meetings shall be held in California.
(n) No person shall receive compensation for serving as a
commissioner, but each commissioner shall receive reimbursement for
reasonable expenses incurred while on authorized commission business.
(o) Assessed businesses shall vote only for commissioners
representing their industry category.
(p) Commissioners shall comply with the requirements of the
Political Reform Act of 1974 (Title 9 (commencing with Section
81000)). The Legislature finds and declares that commissioners
appointed or elected on the basis of membership in a particular
tourism segment are appointed or elected to represent and serve the
economic interests of those tourism segments and that the economic
interests of these members are the same as those of the public
generally.
(q) Commission meetings shall be subject to the requirements of
the Bagley-Keene Open Meeting Act (Article 9 (commencing with Section
11120) of Chapter 1 of Part 1).
(r) The executive director of the commission shall serve as
secretary to the commission, a nonvoting position, and shall keep the
minutes and records of all commission meetings.
SEC. 5. Section 13995.40.5 is added to the Government Code, to
read:
13995.40.5. (a) Notwithstanding subdivision (d) of Section
13995.40, the number of commissioners elected from each industry
category shall be determined by the weighted percentage of
assessments from that category, except that no more than six
commissioners shall be elected from the passenger car rental
category.
(b) This section shall become operative only if the Secretary of
Business, Transportation and Housing provides notice to the
Legislature and the Secretary of State and posts notice on its
Internet Web site that the conditions described in Section 13995.92
have been satisfied.
SEC. 6. Section 13995.49 of the Government Code is amended to
read:
13995.49. The commission may by written contract accept a
voluntary assessment from any person in a travel and tourism related
business who is not an assessed business. The contract shall apply
solely to the person in question and not to any other person in a
travel and tourism related business that is not an assessed business.
The contract shall provide that the voluntary assessment be
proportionately equivalent to the assessment that would be levied if
the person were an assessed business under this chapter, shall permit
that business to vote on any referendum conducted under this chapter
as if that person were an assessed business, and shall have a term
concurrent with the effective period of any referendum on which the
person votes. Individual voluntary assessments under this section
shall be enforceable only under the terms of the respective contracts
to which they pertain. This section shall not be construed to
preclude donations to, or cooperative marketing activities of any
kind with, the commission on the part of any person.
SEC. 7. Section 13995.60 of the Government Code is amended to
read:
13995.60. (a) As used in this article and Article 7 (commencing
with Section 13995.65), "assessment level" means the estimated gross
dollar amount received by assessment from all assessed businesses on
an annual basis, and "assessment formula" means the allocation method
used within each industry segment (for example, percentage of gross
revenue).
(b) Commencing on January 1, 2003, a referendum shall be called
every two years, and the commission, by adopted resolution, shall
determine the slate of individuals who will run for commissioner. The
resolution shall also cover, but not be limited to, the proposed
assessment level, based upon specified assessment formulae, together
with necessary information to enable each assessed business to
determine what its individual assessment would be. Commencing with
the referendum held in 2007 and every six years thereafter, the
resolution shall also cover the termination or continuation of the
commission. The resolution may also include an amended industry
segment allocation formula and the percentage allocation of
assessments between industry categories and segments. The commission
may specify in the resolution that a special, lower assessment rate
that was set pursuant to subdivision (c) of Section 13995.30 for a
particular business will no longer apply due to changes in the unique
circumstance that originally justified the lower rate. The
resolution may include up to three possible assessment levels, from
which the assessed businesses will select one assessment level by
plurality weighted vote.
(c) The commission shall deliver to the secretary the resolution
described in subdivision (b). The secretary shall call a referendum
containing the information required by subdivision (b) plus any
additional matters complying with the procedures of subdivision (b)
of Section 13995.62.
(d) When the secretary calls a referendum, all assessed businesses
shall be sent a ballot for the referendum. Every ballot that the
secretary receives by the ballot deadline shall be counted, utilizing
the weighted formula adopted initially by the selection committee,
and subsequently amended by referendum.
(e) If the referendum includes more than one possible assessment
rate, the rate with the plurality of weighted votes shall be adopted.
(f) Notwithstanding any other provision of this section, if the
commission delivers to the secretary a resolution pertaining to any
matter described in subdivision (b), the secretary shall call a
referendum at a time or times other than as specified in this
section. Each referendum shall contain only those matters contained
in the resolution.
(g) Notwithstanding any other provision of this section, the
secretary shall identify, to the extent reasonably feasible, those
businesses that would become newly assessed due to a change in
category, segment, threshold, or exemption status sought via
referendum, and provide those businesses the opportunity to vote in
that referendum.
(h) This section shall become inoperative on the date the
Secretary of Business, Transportation and Housing provides notice to
the Legislature and the Secretary of State and posts notice on its
Internet Web site that the conditions described in Section 13995.92
have been satisfied, and if the secretary provides those notices,
this section is repealed as of January 1, 2008, unless a later
enacted statute, that is enacted before January 1, 2008, deletes or
extends that date.
SEC. 8. Section 13995.60 is added to the Government Code, to read:
13995.60. (a) As used in this article and Article 7 (commencing
with Section 13995.65), "assessment level" means the estimated gross
dollar amount received by assessment from all assessed businesses on
an annual basis, and "assessment formula" means the allocation method
used within each industry segment (for example, percentage of gross
revenue or percentage of transaction charges).
(b) Commencing on January 1, 2003, a referendum shall be called
every two years, and the commission, by adopted resolution, shall
determine the slate of individuals who will run for commissioner. The
resolution shall also cover, but not
be limited to, the proposed assessment level for each
industry category, based upon specified assessment formulae, together
with necessary information to enable each assessed business to
determine what its individual assessment would be. Commencing with
the referendum held in 2007 and every six years thereafter, the
resolution shall also cover the termination or continuation of the
commission. The resolution may also include an amended industry
segment allocation formula and the percentage allocation of
assessments between industry categories and segments. The commission
may specify in the resolution that a special, lower assessment rate
that was set pursuant to subdivision (c) of Section 13995.30 for a
particular business will no longer apply due to changes in the unique
circumstance that originally justified the lower rate. The
resolution may include up to three possible assessment levels for
each industry category, from which the assessed businesses will
select one assessment level for each industry category by plurality
weighted vote.
(c) The commission shall deliver to the secretary the resolution
described in subdivision (b). The secretary shall call a referendum
containing the information required by subdivision (b) plus any
additional matters complying with the procedures of subdivision (b)
of Section 13995.62.
(d) When the secretary calls a referendum, all assessed businesses
shall be sent a ballot for the referendum. Every ballot that the
secretary receives by the ballot deadline shall be counted, utilizing
the weighted formula adopted initially by the selection committee,
and subsequently amended by referendum.
(e) If the commission's assessment level is significantly
different from what was projected when the existing assessment
formula was last approved by referendum, a majority of members, by
weighted votes of an industry category, may petition for a referendum
to change the assessment formula applicable to that industry
category.
(f) If the referendum includes more than one possible assessment
rate for each industry category, the rate with the plurality of
weighted votes within a category shall be adopted.
(g) Notwithstanding any other provision of this section, if the
commission delivers to the secretary a resolution pertaining to any
matter described in subdivision (b), the secretary shall call a
referendum at a time or times other than as specified in this
section. Each referendum shall contain only those matters contained
in the resolution.
(h) Notwithstanding any other provision of this section, the
secretary shall identify, to the extent reasonably feasible, those
businesses that would become newly assessed due to a change in
category, segment, threshold, or exemption status sought via
referendum, and provide those businesses the opportunity to vote in
that referendum.
(i) This section shall become operative only if the Secretary of
Business, Transportation and Housing provides notice to the
Legislature and the Secretary of State and posts notice on its
Internet Web site that the conditions described in Section 13995.92
have been satisfied.
SEC. 9. Section 13995.64.5 is added to the Government Code, to
read:
13995.64.5. (a) Notwithstanding subdivision (a) of Section
13995.64, if an assessed business within the passenger car rental
category pays an assessment greater than the maximum assessment,
determined by the commission for other industry categories, the
weighted percentage assigned to that assessed business shall be the
same as though its assessment were equal to the highest maximum
assessment.
(b) This section shall become operative only if the Secretary of
Business, Transportation and Housing provides notice to the
Legislature and the Secretary of State and posts notice on its
Internet Web site that the conditions described in Section 13995.92
have been satisfied.
SEC. 10. Section 13995.65 of the Government Code is amended to
read:
13995.65. (a) Each industry category shall establish a committee
to determine the following within its industry category: industry
segments, assessment formula for each industry segment, and any types
of business exempt from assessment. The initial segment committees
shall consist of the subcommittee for that category as described in
subdivision (d) of Section 13995.30. Following approval of the
assessment by referendum, the committees shall be selected by the
commission, based upon recommendations from the tourism industry.
Committee members need not be commission members.
(b) The committee recommendations shall be presented to the
commission or selection committee, as applicable. The selection
committee may adopt a resolution specifying some or all of the items
listed in subdivision (a), plus an allocation of the overall
assessment among industry categories. The commission may adopt a
resolution specifying one or more of the items listed in subdivision
(a), plus an allocation of the proposed assessment. The selection
committee and commission are not required to adopt the findings of
any committee.
(c) The initial industry category and industry segment allocations
shall be included in the selection committee report required by
subdivision (b) of Section 13995.30. Changes to the industry segment
allocation formula may be recommended to the commission by a segment
committee at the biennial commission meeting scheduled to approve the
referendum resolution pursuant to Section 13995.60. At the same
meeting, the commission may amend the percentage allocations among
industry categories. Any item discussed in this section that is
approved by resolution of the commission, except amendments to the
percentage allocations among industry categories, shall be placed on
the next referendum, and adopted if approved by the majority of
weighted votes cast.
(d) Upon approval by referendum, the office shall mail an
assessment bill to each assessed business. The secretary shall
determine how often assessments are collected, based upon available
staffing resources. The secretary may stagger the assessment
collection throughout the year, and charge businesses a prorated
amount of assessment because of the staggered assessment period. The
secretary and office shall not divulge the amount of assessment or
weighted votes of any assessed businesses, except as part of an
assessment action.
(e) An assessed business may appeal an assessment to the secretary
based upon the fact that the business does not meet the definition
established for an assessed business within its industry segment or
that the level of assessment is incorrect. An appeal brought under
this subdivision shall be supported by substantial evidence submitted
under penalty of perjury by affidavit or declaration as provided in
Section 2015.5 of the Code of Civil Procedure. If the error is based
upon failure of the business to provide the required information in a
timely manner, the secretary may impose a fee for reasonable costs
incurred by the secretary in correcting the assessment against the
business as a condition of correcting the assessment.
(f) Notwithstanding any other provision of law, an assessed
business may pass on some or all of the assessment to customers. An
assessed business that is passing on the assessment may, but shall
not be required to, separately identify or itemize the assessment on
any document provided to a customer. Assessments levied pursuant to
this chapter and passed on to customers are not part of gross
receipts or gross revenue for any purpose, including the calculation
of sales or use tax and income pursuant to any lease. However,
assessments that are passed on to customers shall be included in
gross receipts for purposes of income and franchise taxes.
(g) For purposes of calculating the assessment for a business with
revenue in more than one industry category or industry segment, that
business may elect to be assessed based on either of the following:
(1) The assessment methodology and rate of assessment applicable
to each category or segment, respectively, as it relates to the
revenue that it derives from that category or segment.
(2) With respect to its total revenue from all industry categories
or segments, the assessment methodology and rate of assessment
applicable to the revenue in the category and segment in which it
earns the most gross revenue.
(h) (1) A person sharing common ownership, management, or control
of more than one assessed business may elect to calculate,
administer, and pay the assessment owed by each business by any of
the following methods:
(A) Calculated on the basis of each individual business location.
(B) Calculated on the basis of each business, or each group of
businesses, possessing a single federal employer identification
number, regardless of the number of locations involved.
(C) Calculated on the basis of the average aggregate percentage of
tourism-related gross revenue received by all of the person's
businesses in a particular industry segment or industry category
during the period in question, multiplied by the total aggregate
tourism-related gross revenue received by all of the businesses, and
then multiplied by the appropriate assessment formula. For example,
if a person sharing common ownership, management, or control of more
than one assessed business in the retail industry segment calculates
that the average percentage of tourism-related gross revenue received
by all of its locations equals 6 percent during the period in
question, that person may multiply all of the gross revenue received
from all of those locations by 6 percent, and then multiply that
product by the applicable assessment formula.
(D) Calculated on any other basis authorized by the secretary.
(2) Except as the secretary may otherwise authorize, the methods
in subparagraphs (B), (C), or (D) shall not be used if the aggregate
assessments paid would be less than the total assessment revenues
that would be paid if the method in subparagraph (A) were used.
SEC. 11. Section 13995.65.5 is added to the Government Code, to
read:
13995.65.5. (a) Notwithstanding Section 13995.65 or any other
provision of this chapter, for purposes of calculating the assessment
for a business within the passenger car rental category, the
assessment shall be collected only on each rental transaction that
commences at either an airport or at a hotel or other overnight
lodging with respect to which a city, city and county, or county is
authorized to levy a tax as described in Section 7280 of the Revenue
and Taxation Code. A transaction commencing at an airport or hotel or
other overnight lodging subject to a transient occupancy tax as
described in Section 7280 of the Revenue and Taxation Code, including
those that commence at a location that might otherwise by regulation
be exempt from assessment, shall be subject to the assessment. The
assessment shall always be expressed as a fixed percentage of the
amount of the rental transaction.
(b) This section shall become operative only if the Secretary of
Business, Transportation and Housing provides notice to the
Legislature and the Secretary of State and posts notice on its
Internet Web site that the conditions described in Section 13995.92
have been satisfied.
SEC. 12. Section 13995.77 of the Government Code is amended to
read:
13995.77. A business is exempt from the assessments provided for
in this chapter if any of the following apply:
(a) The business is a travel agency or tour operator that derives
less than 20 percent of its gross revenue annually from travel and
tourism occurring within the state. A travel agency or tour operator
that qualifies for this exemption may participate as an assessed
business by paying an assessment calculated on the same basis
applicable to other travel agencies or tour operators, respectively,
and by filing a written request with the secretary indicating its
desire to be categorized as an assessed business.
(b) The business is a small business. For purposes of this
section, "small business" means a business location with less than
one million dollars ($1,000,000) in total California gross annual
revenue from all sources. This threshold amount may be lowered, but
never to less than five hundred thousand dollars ($500,000), by means
of a referendum conducted pursuant to Section 13995.60; however, the
secretary may elect to forgo assessing a business for which the
expense incurred in collecting the assessment is not commensurate
with the assessment that would be collected.
(c) The assessments provided for in this chapter shall not apply
to the revenue of regular route intrastate and interstate bus
service: provided, however, that this subdivision shall not be deemed
to exclude any revenue derived from bus service that is of a type
that requires authority, whether in the form of a certificate of
public convenience and necessity, or a permit, to operate as a
charter-party carrier of passengers pursuant to Chapter 8 (commencing
with Section 5351) of Division 2 of the Public Utilities Code.
(d) Any business exempted pursuant to this section may enter into
a contract for voluntary assessments pursuant to Section 13995.49.
SEC. 13. Section 13995.92 is added to the Government Code, to
read:
13995.92. (a) The California Travel and Tourism Commission shall
submit a referendum to the passenger rental car industry as soon as
possible, but not later than March 31, 2007. The referendum shall
propose an assessment level upon the passenger rental car industry,
as an industry category, under this chapter. The proposed assessment
rate shall be set at a level determined by the commission that will
generate funding that will be sufficient, when aggregated together
with other funding for the commission, minus amounts reverted to the
general fund pursuant to Item 0520-495 of Section 2 of the Budget Act
of 2006, for a spending plan for the 2006-07 fiscal year of
twenty-five million dollars ($25,000,000), and for the 2007-08 fiscal
year of fifty million dollars ($50,000,000).
(b) The commission shall report to the Secretary of Business,
Transportation and Housing if the referendum and assessment rates
described in subdivision (a) are agreed to. The secretary shall
immediately provide notice of that agreement to the Legislature and
the Secretary of State and shall also post notice of that agreement
on its Internet Web site.
SEC. 14. Item 0520-495 is added to Section 2 of the Budget Act of
2006 to read:
0520-495--Reversion, Secretary of
Business, Transportation and Housing. The
sum of $6,300,000, appropriated in Item
0520-001-0001, Budget Act of 2006 (Ch.
47, Stats. 2006; Ch. 48, Stats. 2006),
and made available to the California
Travel and Tourism Commission pursuant to
Provision 1 thereof, shall revert to the
General Fund.
SEC. 15. Section 14 of this act shall become operative only if the
Secretary of Business, Transportation and Housing provides notice to
the Legislature and the Secretary of State and posts notice on its
Internet Web site that the conditions described in Section 13995.92
of the Government Code have been satisfied.
SEC. 16. Notwithstanding any reversion of moneys to the General
Fund pursuant to Section 14 of this act, or any amounts appropriated
to the commission in any future budget act below the levels specified
in Section 13995.70 of the Government Code, the authorization
provided to the travel and tourism industry under that code section
to terminate the commission by referendum shall be deemed suspended
until the end of the 2007-08 fiscal year if the California Travel and
Tourism Commission finds that the referendum held pursuant to
Section 13995.92 of the Government Code allows the commission to meet
the funding goals specified therein.