BILL ANALYSIS                                                                                                                                                                                                    Ó



                                                                  AB 45
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          Date of Hearing:   April 4, 2011

                    ASSEMBLY COMMITTEE ON UTILITIES AND COMMERCE
                               Steven Bradford, Chair
                      AB 45 (Hill) - As Amended:  March 29, 2011
           
          SUBJECT  :   Charter-party carriers: alcoholic beverages: open 
          containers.

           SUMMARY  :   Expands the provisions concerning under-age drinking 
          to apply to drivers of charter-party carriers, with certain 
          exemptions.  Specifically,  this bill  :  

          1)Expands the application of the alcoholic beverage provisions 
            concerning passengers under the age of 21 years by applying 
            those requirements to the driver of any vehicle used as a 
            charter-party carrier.

          2)Makes the third or subsequent violation of the open container 
            prohibition a misdemeanor against the driver of any vehicle 
            used as a charter-party carrier.

           EXISTING LAW  :

          1)Article XII of the California Constitution: 

               a.     Establishes private corporations and persons that 
                 own, operate, control, or manage a line, plant, or system 
                 for the transportation of people or property, and common 
                 carriers, as public utilities subject to control by the 
                 Legislature.

               b.     Allows the California Public Utilities Commission 
                 (PUC) to fix rates and establish rules for the 
                 transportation of passengers and property by 
                 transportation companies.

          2)The Public Utilities Code:

               a.     Requires the PUC to ensure that every charter-party 
                 carrier of passengers operates on a prearranged basis 
                 within the state.

               b.     Requires the driver of any limousine for hire 
                 operated by a charter-party carrier of passengers under a 








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                 valid certificate or permit to comply with certain 
                 requirements relating to alcohol beverages, including:

                     i.          ascertaining whether any passenger is 
                      under the age of 21 years,

                     ii.         reading to the passenger a statement that 
                      the consumption of any alcoholic beverage in the 
                      vehicle is unlawful,

                     iii.        requiring the minor passenger to sign the 
                      statement and if minor is found to be, or to have 
                      been, consuming any alcoholic beverage during the 
                      course of the ride, the driver shall immediately 
                      terminate the contract of hire and return passenger 
                      to the point of origin.

               c.     Subjects the carrier to specified penalties, based 
                 on the number of offenses for conviction of a driver, or 
                 any officer, director, agent or employee of the carrier 
                 that prohibits storage of an opened container of an 
                 alcoholic beverage in a motor vehicle.

           FISCAL EFFECT :   Unknown.

           COMMENTS  :   According to the author, it took the loss of Brett 
          Studebaker, a 19-year old San Mateo resident to expose loopholes 
          in state law regarding under-age drinking in the party bus 
          industry.  

          On the evening of February 5, 2010, Brett Studebaker, a nineteen 
          year old teenager boarded a charter bus to celebrate a friend's 
          birthday.  According to the lawsuit filed by his family, the 
          charter bus dropped the passengers off at their cars at 
          approximately 2:00 a.m. after several hours of heavy alcohol 
          consumption.  Unfortunately, Brett lost his life less than an 
          hour later when he crashed his vehicle into a sound wall and 
          another vehicle on Highway 101 near San Mateo.  It was later 
          determined by officials that Brett's blood alcohol level was 
          more than three times the legal limit for an adult of drinking 
          age.

           1)Background  :  Charter-party carriers are rented as an entire 
            vehicle and transport
          passengers on a prearranged basis.  A charter-party carrier is 








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          also referred to as a party bus, charter bus and limousine.  

          Charter-party carriers are regulated by the CPUC pursuant to the 
          Passenger Charter-Party Carriers' Act (Public Utilities Code 
          Section 5351).  Carriers operate under one or more of the 
          various types of permits and certificates issued by the CPUC.  
          There are three categories of certificates (designated Class A, 
          B, and C) and three categories of permits (designated P, S, and 
          Z). The certificates and permits authorize different kinds of 
          transportation services or limit the size of the vehicle that 
          may be operated.  Approximately 5,600 carriers hold one or more 
          certificates and permits.  

           2)Issue  :  Limousines were not regulated by the PUC until the 
            proliferation of limousines
          companies in the late 1980s began to lead to serious drug and 
          alcohol abuse on limousine rides by minor.  Similar to 
          limousines, charter buses are the new place for under-age 
          teenagers to drink.  Some of these buses have the reputation for 
          promoting drinking parties on wheels, and there is no consistent 
          set of regulations promulgated to ensure that drivers are 
          checking the passenger's photo identification.  

           3)PUC enforcement authority  :  The PUC is the agency responsible 
            for licensing limousine
          operators by issuing them a charter-party carrier permit or 
          certificate.  Limousine operators and other charter-party 
          carriers are required to participate in the DMV Employer Pull 
          Notice System, which is a program for the carrier-employer to 
          monitor the driving records of its drivers.  If a driver is 
          pulled over by a California Highway Patrol officer (CHP) for 
          violating the open container law, that information is supposed 
          to be given to the PUC by the courts.  This information sharing 
          allows the PUC to issue administrative citations and with fines 
          against charter-party carriers for violations of the law or PUC 
          rules and regulations.  

          For instance, if a limousine driver is pulled over by a law 
          enforcement officer and is found to have passengers under 21 
          years of age drinking inside of the vehicle, the driver can then 
          be charged with an open container violation.  The PUC does not 
          have the authority to impose penalties against the driver.  The 
          carrier (i.e. company) is held responsible for any violations 
          committed by its drivers.  For a first offense, the PUC may 
          impose a civil penalty no greater than two thousand dollars 








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          ($2,000) upon the carrier.  For a second offense, the PUC may 
          impose a civil penalty no greater than two thousand dollars upon 
          the carrier or suspend the carrier's permit for not more than 30 
          days, or both.  For a third offense, the PUC shall revoke the 
          carrier's permit.  These provisions and penalties also apply to 
          a limousine driver or a carrier officer, director, agent or 
          employee who is convicted of having an open container of an 
          alcoholic beverage in the vehicle when a minor passenger is 
          being transported.  

          According to the PUC, in recent years staff has not received any 
          notices from the courts of a violation of the open container 
          prohibition by a limousine driver or a company official.

           4)Close the loophole  :  This bill extends to all charter-party 
            carrier vehicles the protections
          against under-age drinking of alcoholic beverages that currently 
          apply only to limousines.  For a first offense, the PUC may 
          impose a civil penalty no greater than two thousand dollars 
          ($2,000) upon the carrier.  For a second offense, the PUC may 
          impose a civil penalty no greater than two thousand dollars 
          ($2,000) upon the carrier, or suspend the carrier's permit for 
          no more than 30 days, or both.  On a third offense, the PUC 
          shall revoke the carrier's permit.  A third or subsequent 
          offense would subject the driver to misdemeanor criminal charges 
          which would be enforceable by the appropriate law enforcement 
          agency.

           5)Statistical data  :  While there is no statistical data 
            available at this time, there is antidotal
          evidence that may substantiate the need for greater regulatory 
          oversight.  According to a news article published in the Los 
          Angeles Times in March 2011, the Los Angeles Police Department 
          formed a task force over the last year to address the growing 
          problems with party buses.  The task force has received 
          cooperation from many of the club operators who turn away 
          partiers who have engaged in excessive drinking or appear 
          under-age.  

          Additionally, PUC staff has been participating in vehicle 
          inspections, including vehicles operated as party buses, with 
          other law enforcement agencies where under-age drinking or other 
          alcohol related incidents occur.  These include inspections 
          conducted periodically by the Hollywood Strike Force and 
          surrounding areas and by the San Diego Area Law Enforcement Task 








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          Force in the Pacific Beach and Mission Beach areas of San Diego, 
          where large numbers of university students are attracted to the 
          lively nightlife.  Any violations by a charter-party carrier 
          that are observed by the staff are dealt with subsequently by 
          the issuance of a citation or warning notice.

           6)Unintended consequences  :  While the focus of the author's 
            concern seems to be party buses,
          charter-party buses that are used for other purposes would be 
          subject to the same requirements.  For example, buses chartered 
          by a school to transport pupils on field trips when they are 
          usually accompanied by faculty or other school staff, or school 
          buses used to conduct round-trip sightseeing services when minor 
          passengers are on board who usually are under the supervision of 
          a parent would be impacted by the language in this bill.  
          Therefore,  the author and this committee may wish to amend the 
          bill to allow an exemption for certain youth group bus 
          activities  .    

           7)Technical amendments  : Revise Section 5384.5(c) to refer to the 
            "carrier's certificate or permit" since the carrier could be 
            operating under either type of charter-party authority.

           
          REGISTERED SUPPORT / OPPOSITION  :   

           Support 
           
          California Public Utilities Commission (CPUC) 
          Greater California Livery Association (GCLA) (as proposed to be 
          amended)
          Los Angeles County Sheriff's Department

           Opposition 
           
          California Bus Association (CBA) (unless amended)
           
          Analysis Prepared by  :    DaVina Flemings / U. & C. / (916) 
          319-2083