BILL ANALYSIS                                                                                                                                                                                                    �



                                                                  AB 306
                                                                  Page  1

          Date of Hearing:   April 17, 2013

                        ASSEMBLY COMMITTEE ON APPROPRIATIONS
                                  Mike Gatto, Chair

               AB 306 (Lowenthal) - As Introduced:  February 12, 2013 

          Policy Committee:                               
          TransportationVote:16-0

          Urgency:     No                   State Mandated Local Program:  
          Yes    Reimbursable:              No

           SUMMARY  

          This bill requires any business contracting with a tow operator  
          to obtain proof of a valid motor carrier permit (MCP) before  
          allowing the tow operator to retrieve or deliver vehicles to or  
          from the business's premises.

           FISCAL EFFECT  

          1)Minor absorbable administrative costs to the DMV.

          2)Minor non-reimbursable costs from the expansion of an existing  
            crime-related statute, a violation of which is a misdemeanor  
            subject to a fine of  up to $2,500 and/or imprisonment in  
            county jail for up to three months.

           COMMENTS  

           Background and Purpose  . The Motor Carrier Safety Improvement Act  
          (1996) was intended to ensure that commercial motor carriers  
          meet all of the statutory requirements to safely operate on  
          California's highways.  Under this Act, a motor carrier is  
          prohibited from subcontracting with or engaging the services of  
          another motor carrier unless the contracted motor carrier  
          provides certification of compliance with existing law and  
          regulations including the requirement to hold a valid MCP.

          SB 145 (De Leon)/Chapter 429 of 2010, among other things,  
          addressed a loophole in the Act that allowed motor carriers to  
          engage the services of other motor carriers who may not have a  
          valid MCP.  Specifically, AB 145 clarified that construction  
          trucking brokers-who in some cases may not themselves be motor  








                                                                  AB 306
                                                                  Page  2

          carriers-were also required to ensure that the trucking  
          companies they contract with possess a valid MCP.

          AB 145 did not, however, explicitly address tow operators that  
          deliver and retrieve vehicles. As a result, some tow operators  
          are continuing to operate without a MCP and are able to do so  
          because there is no explicit requirement that they show proof of  
          having a valid MCP before providing transporting vehicles. As a  
          result, according to the California Tow Truck Association  
          (sponsor), some unscrupulous tow operators continue to operate  
          without a valid MCP, placing motorists at risk and undercutting  
          their competition. AB 306 closes this loophole.

           Analysis Prepared by :    Chuck Nicol / APPR. / (916) 319-2081