BILL ANALYSIS                                                                                                                                                                                                              1
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                SENATE ENERGY, UTILITIES AND COMMUNICATIONS COMMITTEE
                                 ALEX PADILLA, CHAIR
          

          AB 2572 -  Bradford                     Hearing Date:  June 15,  
          2010                  A
          As Amended:         May 5, 2010                   FISCAL       B

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                                      DESCRIPTION
          
           Current law  authorizes the California Public Utilities  
          Commission (CPUC) to regulate charter-party carriers of  
          passengers, defined to mean persons engaged in the  
          transportation of persons by motor vehicle for compensation on a  
          prearranged basis over any public highway in California.

           This bill  expands the definition of charter-party carriers  
          subject to CPUC regulation to include any person or entity  
          engaged in the provision of a hired driver service when a rented  
          motor vehicle is operated by the hired driver and exempts these  
          hired driver charter-party carriers from specified requirements  
          applicable to entities that own charter-party carrier vehicles. 

           Current law  requires each initial and renewal applicant for a  
          charter-party carrier certificate or permit to pay specified  
          fees.

           This bill  increases the cost of new permits and Class B and C  
          certificates from $500 to $1,000 and decreases the cost of all  
          renewal permits and certificates from $500 to $1,000.

           Current law  authorizes the CPUC to cancel, revoke, or suspend a  
          permit or certificate issued to a charter-party carrier for  
          failure of a permit or certificate holder or its employees to  
          follow specified laws and CPUC orders and regulations, pay  
          required fees, maintain its vehicle in a safe operating  
          condition, and other specified reasons.












           This bill  would authorize the CPUC to cancel, revoke, or suspend  
          any permit or certificate issued to a charter-party carrier if  
          the permit or certificate holder failed to follow any order,  
          decision, rule, regulation, direction, demand, ordinance, or  
          other requirement established by the governing board of an  
          airport, including solicitation practices.

           This bill  would make inapplicable as a reason to cancel, revoke,  
          or suspend a permit or certificate held by a charter-party  
          carrier the requirement to maintain its vehicle in a safe  
          operating condition in the case of a hired driver carrier.
           
          Current law  authorizes a peace officer to impound a  
          charter-party carrier vehicle being operated in violation of the  
          law only within 100 feet of a public airport or within two miles  
          of the international border between the United States and  
          Mexico.  

           This bill  deletes that geographic limitation on the authority to  
          impound a vehicle used by a charter-party carrier.

           Current law  requires that a vehicle impounded by a local peace  
          officer for violation of a local ordinance or resolution be  
          returned to the owner of the vehicle without cost if the  
          infraction or violation is not prosecuted or dismissed, the  
          owner is not found guilty of the offense or it is determined  
          that the owner was not aware of, nor did not consent to, the use  
          of the vehicle for the violation.  

           This bill  requires the return of an impounded vehicle to the  
          owner after all impoundment fees are paid when the vehicle is  
          seized due to a violation of a person other than the owner of  
          the vehicle.

           This bill  states the intent of the Legislature to achieve all of  
          the following:

                 Ensure that the CPUC has access to real-time information  
               on drivers for licensed charter-party carriers by utilizing  
               the Department of Motor Vehicle's Employer Pull Notice  
               Program.

                 Have the CPUC implement procedures for an approved drug  
               and alcohol testing provider to submit timely information  










               on the status of licensed charter-party carriers with which  
               they have contracted for testing of drivers.

                 Have the CPUC create an online renewal process for  
               charter-party carriers of passengers and a renewal process  
               that is administratively efficient.


                                      BACKGROUND
           
          The Passenger Charter-Party Carriers' Act provides for CPUC  
          regulation of charter-party carriers, defined as persons engaged  
          in the transportation of persons by motor vehicle for  
          compensation on a prearranged basis over any public highway in  
          the state, including, for example, limousines, airport shuttles,  
          and chartered buses.  The purposes of the Act include preserving  
          full public benefit and use of public highways, ensuring  
          adequate and dependable transportation by carriers operating  
          upon the highways, and promoting carrier and public safety  
          through enforcement of safety regulations.  

          The Act requires charter-party carriers to obtain operating  
          authority from the CPUC through permits and certificates,  
          requires the CPUC to investigate complaints and cancel, revoke,  
          or suspend permits and certificates for specified violations,  
          and regulates other terms of operation.  The CPUC issues six  
          different types of permits and certificates authorizing various  
          kinds of services.  Approximately 6,200 carriers currently hold  
          one or more operating authorities.  The law prescribes specific  
          requirements for vehicle maintenance and safety standards,  
          driver screening and training, controlled substance and alcohol  
          testing, workers' compensation insurance, and fitness and  
          financial responsibility.


                                       COMMENTS

             1)   Hired Driver Service  .  According to the author and the  
               Greater California Livery Association, the bill's sponsor,  
               this bill closes a loophole in current law by giving CPUC  
               authority to regulate a new transportation business model  
               in which a rented motor vehicle is operated by a hired  
               driver. Under that business model being employed by Avis  
               Rent A Car and a separate company called WeDriveU, Avis  










               refers a rental customer to WeDriveU to engage a driver to  
               operate the Avis vehicle at the customer's direction.  This  
               bill expands the definition of charter-party carriers so  
               that WeDriveU and similar operators would be covered by the  
               Act.  Because these operators compete with traditional  
               charter-party carriers, this bill ensures a level playing  
               field and protects the public by making provisions of the  
               Act applicable.  The bill also makes provisions of the Act  
               that relate to carriers owning a vehicle inapplicable to  
               charter-party carriers such as WeDriveU.

              2)   Permits and Certificates  .  This bill increases initial  
               application fees for charter-party carrier permits and  
               Class B and C certificates from $500 to $1,000 and  
               decreases the cost of all renewal permits and certificates  
               from $500 to $100.  These changes result in fees that more  
               closely correlate to when the CPUC incurs costs - more  
               costs at the time of an initial application than at  
               renewal.  The bill also states legislative intent that the  
               CPUC create a renewal process that is available online and  
               administratively efficient.  An improved renewal process  
               will reduce administrative burdens on carriers and the CPUC  
               and result in fewer carriers being subject to fines and  
               penalties if they continue to operate after their authority  
               expires because the renewal was not processed in a timely  
               manner.

              3)   Impoundment  .  This bill expands the geographic area in  
               which the vehicles of unlicensed carriers may be impounded  
               from airports and near the U.S.-Mexico border to anywhere  
               in the state and would make the vehicle owner responsible  
               for the associated impoundment fees in order to retrieve  
               the vehicle.  Expanding the authority to impound vehicles  
               of unlicensed carriers to anywhere in the state will enable  
               impoundment at hotels, convention centers, and tourist  
               locations where carriers typically operate.  It also may  
               bolster enforcement of the Act and serve as an additional  
               deterrent to operating without proper authority. 

              4)   Airport Regulations  .  While current law allows for  
               placement of CPUC enforcement personnel at airports, it  
               does not explicitly allow CPUC enforcement of airport  
               regulations when patrolling at the airport.  This bill  
               provides that the CPUC may cancel, revoke, or suspend any  










               permit or certificate issued to a charter-party carrier if  
               the carrier fails to follow any order, decision, rule,  
               regulation, direction, demand, ordinance, or other  
               requirement established by the governing board of an  
               airport, including airport restrictions on solicitation  
               practices.  In some instances, the CPUC and airports may  
               have differing regulations, as is the case, for example,  
               with weigh bill requirements of the CPUC and the San  
               Francisco Airport.  While this provision could lead to  
               arbitrary or selective enforcement of different regulations  
               by the CPUC, it should lead to overall enhanced enforcement  
               of regulations that protect public safety and ensure a  
               level playing field in the charter-party carrier market.


              5)   Double Referral  .  This bill has been double-referred to  
               the Senate Transportation and Housing Committee.
           

                                   ASSEMBLY VOTES

           Assembly Utilities & Commerce      (15-0)
          Assembly Transportation            (12-0)
          Assembly Appropriations            (14-1)
          Assembly Floor                     (62-4)


                                       POSITIONS
           
           Sponsor:
           
          Greater California Livery Association

           Support:
           
          Greater California Livery Association
          California Bus Association
          California Public Utilities Commission
          San Francisco International Airport
          WeDriveU, Inc.

           Oppose:
           
          None on file.












          Jackie Kinney 
          AB 2572 Analysis
          Hearing Date:  June 15, 2010