BILL ANALYSIS                                                                                                                                                                                                    



                                                                  AB 2499
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          ASSEMBLY THIRD READING
          AB 2499 (Portantino)
          As Amended March 25, 2010
          Majority vote 

           TRANSPORTATION      12-0        APPROPRIATIONS      17-0        
           
           ----------------------------------------------------------------- 
          |Ayes:|Bonnie Lowenthal, Bill    |Ayes:|Fuentes, Conway, Ammiano, |
          |     |Berryhill, Blumenfield,   |     |Bradford, Charles         |
          |     |Buchanan, Eng, Galgiani,  |     |Calderon, Coto, Davis,    |
          |     |Hayashi, Miller, Niello,  |     |Monning, Ruskin, Harkey,  |
          |     |Norby, Portantino,        |     |Miller, Nielsen, Norby,   |
          |     |Solorio                   |     |Skinner, Solorio,         |
          |     |                          |     |Torlakson, Torrico        |
          |     |                          |     |                          |
           ----------------------------------------------------------------- 
           SUMMARY  :  Brings home study traffic violator schools (TVSs)  
          under the purview of the Department of Motor Vehicles (DMV).   
          Specifically,  this bill  :  

          1)Provides that completion of a program at a TVS as a result of  
            having violated a statute relating to safe vehicle operation  
            shall result in a designation of the driver's conviction as  
            confidential, rather than having the complaint dismissed.  

          2)Provides, in such a circumstance, that no point count is to be  
            assessed against the driver's record.  

          3)Removes the confidentiality of the conviction if the convicted  
            person holds a commercial driver's license, the violation  
            occurred in a commercial vehicle, or the violation is one that  
            results in more than one point against the driver's record.  

          4)Requires DMV to establish standards for each TVS instructional  
            modality, which may include requirements specific to each  
            modality.  

          5)Increases to $15,000 the amount of the bond that each TVS is  
            required to file with DMV.  

          6)Repeals the requirement for TVS classrooms to be approved by  
            DMV.  









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          7)Repeals the requirement for a TVS lesson plan to provide at  
            least 400 minutes for adults or 600 minutes for persons under  
            18.  

          8)Requires a TVS lesson plan to include a postlesson knowledge  
            test and requires the lesson plan for each instructional  
            modality to obtain separate approval by DMV.  

          9)Prohibits any person from being designated as the operator of  
            more than one TVS.  

          10)Allows a TVS with multiple branch locations to designate a  
            separate operator for each location, but requires it to  
            designate one of the operators as the primary contact for DMV.  
             

          11)Allows a TVS owner who is designated as the operator for the  
            school to act as an instructor without meeting the  
            requirements that otherwise apply to instructors.  

          12)Allows the owner's license to include authorization to act as  
            an instructor if the owner is not designated as the operator  
            but meets instructor requirements.  The owner's license would  
            be required to specify if the owner is authorized to offer  
            instruction.  If the owner is not approved to act as an  
            instructor, the TVS would be required to employ a licensed  
            instructor.  

          13)Requires a court-approved traffic safety program that was in  
            operation prior to July 1, 2011, to file an application for  
            licensure as a TVS by September 1, 2011.  

          14)Prohibits any court from approving a traffic safety program  
            after June 30, 2011.  

          15)Allows a court-approved program to continue to operate as  
            approved by a court until the DMV makes a licensing decision.   


          16)Allows a licensed court-approved traffic safety program to  
            continue to use a curriculum approved by a court until DMV  
            establishes curriculum standards in regulation.  

          17)Requires any such court-approved program to comply with the  








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            new curriculum standards by the effective date established in  
            regulation.  

          18)Repeals requirements for DMV to publish a referral list of  
            all the approved locations of TVS classes and instead requires  
            DMV to provide a list of licensed TVSs on its Internet Web  
            site. For each licensed school, the list would be required to  
            indicate the modalities of instruction offered and specify the  
            cities where classroom instruction is offered.  The sequential  
            listing of licensed schools would be randomized daily.  

          19)Requires DMV to develop a Web-based database accessible by  
            the courts and TVSs to allow oversight of TVS student  
            enrollments and course completions.  

          20)Allows courts to charge traffic violators a fee to defray the  
            costs incurred by a court assistance program (CAP) for  
            monitoring and traffic administration services provided to the  
            court.  

          21)Prohibits the fee from exceeding the actual cost incurred by  
            the CAP.  

          22)Repeals provisions governing the monitoring of TVSs by CAPs.   

           
           23)Allows courts to enter into contracts with public or private  
            nonprofit agencies to provide services to the court, provided  
            those services do not duplicate those conducted by DMV.  

          24)Repeals obsolete requirements regarding the collection of  
            information by the Judicial Council regarding TVSs.  

          25)Requires DMV to charge a fee for each of the following:  

             a)   Original issuance of a TVS owner, operator, instructor,  
               and branch or classroom location license;

             b)   Renewal of a TVS owner, operator, instructor, and branch  
               or classroom location license;

             c)   Issuance of a duplicate or corrected TVS owner,  
               operator, instructor, and branch or classroom location  
               license;








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             d)   Transfer of an operator or instructor license from one  
               TVS to another;

             e)   Approval of curriculum, based on the instructional  
               modality of the curriculum; and,

             f)   Administration of TVS instructor examinations.  

          26)Requires these fees to be sufficient to defray DMV's actual  
            cost to administer the TVS program, except for routine  
            monitoring of instruction.  

          27)Requires a single administrative fee to be assessed against,  
            and collected by the court from, each driver who is allowed or  
            ordered to attend TVS, including an amount determined by DMV  
            to be sufficient to defray the cost of routine monitoring of  
            TVS instruction.  
          
          28)Allows a court, after a deposit of bail and bail forfeiture,  
            a plea of guilty or no contest, or a conviction, to order a  
            continuance of a proceeding against a person who receives a  
            notice to appear in court for a violation of a statute  
            relating to the safe operation of a vehicle, in consideration  
            for attendance at a licensed TVS.  
           
           29)Allows the court to order that the conviction be held  
            confidential by DMV if the offense is not alleged to have  
            occurred within 18 months of another offense that was held  
            confidential.  

          30)Allows the court to order or permit completion of a licensed  
            TVS program.  

          31)Requires the driver, in such an instance, to submit to the  
            court a certificate of completion for the traffic violator  
            program by the date required by the court.  If the certificate  
            of completion is not received by the court as required, the  
            court would be authorized to issue an order to show cause for  
            the failure to comply with the court's order.  Upon issuance  
            of an order to show cause, the court would be required to  
            notify the person by mail that failure to appear at court  
            within 10 days of the notice and show good cause for the  
            failure to comply with the order to submit a certificate of  








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            completion will result in the reporting of the conviction,  
            assessment of points for an offense, and an increased sentence  
            up to the full fine, penalties, and fees allowed by law for  
            the conviction.  If the person fails to appear as ordered, the  
            court would be required to update the court records to change  
            the status of the conviction included in the previous order  
            from confidential to public and to report the conviction to  
            DMV.  

          32)Allows a court, after a deposit of a specified fee or bail, a  
            plea of guilty or no contest, or a conviction, to order or  
            permit a person who holds a noncommercial class C, class M1,  
            or class M2 driver's license who pleads guilty or no contest  
            or is convicted of a traffic violation, to attend a TVS.  

          33)Prohibits a court from ordering or permitting a person who  
            holds a class A, class B, or commercial class C driver's  
            license to complete a licensed TVS course in lieu of  
            adjudicating any traffic offense, or from ordering that a  
            conviction of a traffic offense by a person holding a class A,  
            class B, or commercial class C driver's license to be kept  
            confidential.  

          34)Prohibits a court from ordering a conviction to be kept  
            confidential or permitting a person, regardless of the  
            driver's license class, to complete a program at a licensed  
            TVS in lieu of adjudicating an offense if the offense occurred  
            in a commercial motor vehicle or is one of several serious  
            enumerated violations such as reckless driving or leaving the  
            scene of an accident.  

          35)Repeals provisions that allow courts to restrict referrals to  
            certain TVSs.  

          36)Modifies content of the courtesy notice mailed to a defendant  
            for an offense that qualifies for TVS attendance to include  
            the message: "One conviction in any 18-month period will be  
            held confidential and not show on your driving record if you  
            complete a traffic violator school program."  
           
           37)Specifies that the fee collected by a court clerk from every  
            person ordered or permitted to attend TVS is to be in an  
            amount equal to the total bail set forth for the eligible  
            offense on the uniform countywide bail schedule plus a $49  








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            court administrative fee and a fee determined by DMV to be  
            sufficient to defray the cost of routine monitoring of TVS  
            instruction.  

          38)Requires this fee to be allocated to DMV to defray the costs  
            of TVS instruction.  

           EXISTING LAW  :

          1)Allows a court to order any person convicted of a traffic  
            violation to attend a TVS.  

          2)Allows a court, in lieu of adjudicating a traffic offense, to  
            order a person to attend a TVS with the consent of that  
            person.  

          3)Allows a court to grant a continuance and dismiss an action  
            for violation of any statute related to the safe operation of  
            a vehicle in consideration for attendance at a TVS or any  
            other court-approved program of driving instruction.  

          4)Requires DMV to license TVSs and prohibits persons from owning  
            or operating TVSs without a DMV license.  

          5)Establishes various license requirements for TVSs, including  
            the maintenance of a place of business, the procurement of a  
            bond, and having a lesson plan approved by DMV with a  
            prescribed number of minutes of instruction.  

          6)Requires DMV to license TVS operators and prescribes minimum  
            qualifications for licensed operators including passage of a  
            DMV examination and having 500 hours experience providing  
            in-class instruction in driver training and education.  

           FISCAL EFFECT  :  According to the Assembly Appropriations  
          Committee, one-time costs, probably in the range of $200,000,  
          for DMV to develop new rules, regulations, and licensing  
          requirements for the each segment of the TVS industry (motor  
          vehicle account) and unknown ongoing costs to DMV, ranging from  
          the low hundreds of thousands to several million dollars  
          annually, depending on how this bill is implemented, for  
          example, how the monitoring of TVS programs is divided between  
          DMV and court assistance programs.  In all cases, the costs are  
          fully covered by revenue generated by either regulatory fees  








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          imposed by the department on TVS's or by penalties assessed by  
          courts on traffic violators.  

           COMMENTS  :  Under existing law, motorists cited for certain  
          traffic violations may, at the option of the court, be ordered  
          to attend TVS as part of their sentence or be offered to have  
          the charges dismissed in consideration for attending TVS.  There  
          are reportedly 400 licensed TVSs and unlicensed 200 home study  
          schools currently operating in the state.  It is estimated that  
          about one million persons, or one fourth of all minor traffic  
          offenders, take a TVS class annually. The TVS option assists the  
          operation of the courts by significantly reducing the sheer  
          volume of potential court cases.  

          DMV licenses all classroom TVSs, plus their owner-operators, and  
          instructors.  In addition, DMV establishes course curricula,  
          provides completion certificates, conducts monitoring  
          activities, and performs other related responsibilities.  Home  
          study courses, on the other hand, are approved by individual  
          courts on a court-by-court basis.  Consequently, for these  
          courses, there are no consistent standards for curriculum  
          content, duration of course, or verification of the identity of  
          the student.  

          This bill is the latest in a long series of attempts to bring  
          all segments of the TVS industry under the direction of DMV.   
          The issue of providing a uniform set of standards for traffic  
          school operations has tended to pit the "brick-and-mortar," or  
          classroom, segment of the industry against the "home study"  
          (i.e., mostly internet, but also video, and correspondence)  
          segment of the industry.  Other interested parties, each with  
          their own preferences and points of view, include the courts,  
          the CAPs, and DMV itself.  As noted below, a number of attempts  
          to resolve this issue have been unsuccessful, with numerous  
          bills failing to clear the Legislature and one having been  
          vetoed by the Governor.  

          Most recently, the Legislature directed DMV to recommend a  
          comprehensive plan for licensing all TVS instructional programs.  
           This bill is intended to implement the DMV recommendation that  
          were developed in response to that mandate.  

          The DMV report laid out a far-reaching plan for licensing all  
          segments of the TVS industry, transitioning the court-approved  








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          programs to this new licensing scheme, and implementing a fee  
          schedule that would support these licensing and oversight  
          activities.  It also recommended that the process for dismissing  
          traffic violations be re-structured to prevent high-risk drivers  
          from completing traffic safety instruction multiple times to  
          avoid convictions, that all complaints concerning the TVS  
          program be submitted directly to the department and not be  
          submitted or processed by any other entity, and that, while DMV  
          should be responsible for annual post-licensing review of the  
          business, the routine monitoring of the TVS courses could be  
          "outsourced" (i.e., by the use of CAPs, as is currently done by  
          the courts).  

          On this last point, the report states, "The department  
          recognizes and appreciates the services provided by CAPs, which  
          have assumed a significant role in monitoring classroom and  
          home-study programs.  For example, the California Traffic Safety  
          Institute has 60 course monitors working in 25 counties every  
          day.  This means that nearly 25% of the TVS providers operating  
          within those judicial districts are monitored daily."  It also  
          states, "The department recommends that the routine monitoring  
          of the TVS courses be performed by department employees and  
          third parties, similar to the function provided under today's  
          system by CAPs."  It should be noted, however, that in the view  
          of the CAPs, the current bill language does not reflect this  
          particular DMV recommendation.  

          The classroom segment of the industry, which opposes this bill,  
          goes further, claiming that the bill is unworkable as DMV has  
          nowhere near the resources to oversee this large of an  
          operation.  The classroom operators contend that, "There is no  
          demonstrated need to authorize DMV to regulate home study  
          traffic violator programs on a statewide basis.  Only home study  
          programs will profit which will force more classroom schools out  
          of business.  The current system is not broken and is not in  
          need of major surgery.  DMV has not demonstrated over the years  
          that it can effectively regulate the classroom industry.  Based  
          on past experience, DMV cannot effectively regulate the hundreds  
          of existing home study programs, hundreds of new home study  
          school applications that will result from the enactment of AB  
          2499."  Classroom operators also object to the bill's reliance  
          on online lists of TVSs rather than the current paper list that  
          is distributed by DMV.  "The proposal in AB 2499 to only make  
          the Classroom Location List available to the traffic violator  








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          electronically via DMV's website, is strongly opposed.  It is  
          discriminatory!  It discriminates against all California drivers  
          who do not have, or use, the internet.  This one change alone  
          will disenfranchise hundreds of thousands of traffic violators,  
          including 10.9-million Californians who do not go online."  

          Nevertheless, this bill represents a major step forward in  
          enacted a long-sought regulatory scheme to bring some parity and  
          consistency to a process that impacts so many drivers and holds  
          the potential, if as yet unrealized, to positively affect driver  
          behavior.  

          Speaking on behalf of the courts, which currently (and  
          reluctantly) oversee home study courses, the Judicial Council  
          states, "The bill effectively implements the goals the Judicial  
          Council supported in 2007 of ensuring meaningful statewide  
          regulation of an industry, and relieving the judicial branch of  
          its well-intended, but misplaced, role in attempting to ensure  
          quality TVS programs for court users in the absence of statewide  
          regulation.  It is critical to maintain the distinction between  
          executive branch and judicial branch function.  AB 2499 would  
          properly place the regulation of the TVS industry with the  
          executive branch.  AB 2499 brings consistency to the TVS  
          licensing requirements, while giving DMV the ability to ensure  
          that all components of the TVS process are designed to improve  
          traffic safety in California."  

          Similarly, the National Association of Driving Safety Educators,  
          representing home study providers, states, "There is simply no  
          public policy reason why providers of traffic violator education  
          should be regulated based upon the modality of the instruction  
          they offer.  Licensing and regulation is properly an executive  
          branch function which should be performed by DMV, not by 58  
          different Superior Courts.  In a time of extreme pressure on  
          court budgets, there is a compelling need to relieve courts of  
          duties more properly performed by the executive branch, so that  
          courts can focus on core duties.  Consolidating regulation in  
          the DMV will eliminate the current hodge-podge of rules applied  
          to traffic violator schools by the various courts.  Although our  
          client companies may well pay more for regulation under AB 2499,  
          we are in strong support of the measure because we will have one  
          regulator, with one set of rules, and be relieved of the burden  
          of seeking approval to operate on a court-by-court basis, 58  
          times."  








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          While there may be some clarification needed as to retaining the  
          beneficial role to be played by CAPs, there seems to be  
          consensus, other than from the classroom segment of the  
          industry, that it is time to bring all TVS activities under the  
          purview of DMV.  Inasmuch as this bill builds on the efforts of  
          the vetoed AB 2377 (Longville) of 2004, but also incorporates  
          the recommendations contained in DMV's report, it would appear  
          to have the best chance of any of the recent attempts at TVS  
          reform to both pass legislative review and obtain a Governor's  
          signature.  

          Legislative history:  This bill is a followup to AB 758 (Plescia  
          and Portantino) Chapter 396, Statutes of 2007.  The introduced  
          version of AB 758 would have required DMV to license home study  
          TVSs.  When consensus could not be achieved on a means of  
          accomplishing that goal, the bill more modestly required DMV to  
          recommend to the Legislature a comprehensive plan for licensing  
          all TVS instructional programs.  

          In that same session, Mr. Portantino carried AB 1099, which  
          would have restructured the governance of TVSs.  AB 1099 died on  
          Suspense in the Assembly Appropriations Committee.  Previously,  
          AB 1932 (Benoit) of 2006, offered a comprehensive scheme for the  
          DMV regulation of home study TVSs.  AB 1932 also died on  
          Suspense in the Assembly Appropriations Committee.  AB 1932 was  
          largely a reintroduction of AB 2377 (Longville), which was  
          vetoed by the Governor in 2004.  The Governor's veto message  
          said, in part: "This bill is another example of expanding state  
          bureaucracy without demonstrating a need.  It is a waste of  
          taxpayer money to require the Department of Motor Vehicles to  
          expend significant funds to provide for licensing of traffic  
          violator schools that are currently approved at the local level  
          by the courts."  

          AB 2377 was, in turn, a follow-up to AB 435 (Matthews),  
          introduced in 2003 and AB 546 (Cohn), introduced in 2001.  AB  
          435 and AB 546 were ultimately unsuccessful due to the inability  
          of the affected parties to come to a comprehensive agreement.   
          The long and contentious history of this issue had, in fact, led  
          the then-chair of the Senate Transportation Committee to state  
          that his committee would not hear any TVS-related legislation  
          that did not represent a consensus.  In that context, long-term  
               discussions between classroom TVSs, home study TVSs, court  








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          assistance programs (CAPs), court clerks, DMV, and legislative  
          staff did manage to achieve consensus on one facet of the TVS  
          issue, the oversight of TVSs by DMV and CAPs.  That consensus  
          was embodied in AB 1479 (Chu), Chapter 518, Statutes of 2003.  

          Senator Runner introduced a spot bill earlier in this session,  
          SB 210, that might have served as a vehicle for TVS reform.  An  
          inability to achieve consensus among that various parties  
          reportedly led the senator to abandon that effort.  


           
          Analysis Prepared by  :   Howard Posner / TRANS. / (916) 319-2093 



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