BILL ANALYSIS AB 2499 Page 1 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. AB 2499 Page 2 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 AB 2499 Page 3 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; AB 2499 Page 4 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 AB 2499 Page 5 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 AB 2499 Page 6 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 AB 2499 Page 7 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 AB 2499 Page 8 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 AB 2499 Page 9 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." AB 2499 Page 10 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 AB 2499 Page 11 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 FN: 0004592