BILL ANALYSIS Ó
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|SENATE RULES COMMITTEE | AB 229|
|Office of Senate Floor Analyses | |
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THIRD READING
Bill No: AB 229
Author: Chang (R)
Amended: 8/18/15 in Senate
Vote: 21
SENATE GOVERNMENTAL ORG. COMMITTEE: 11-1, 7/14/15
AYES: Hall, Berryhill, Block, Gaines, Galgiani, Glazer, Hill,
Lara, McGuire, Runner, Vidak
NOES: Hueso
NO VOTE RECORDED: Hernandez
SENATE APPROPRIATIONS COMMITTEE: Senate Rule 28.8
ASSEMBLY FLOOR: 74-0, 5/22/15 - See last page for vote
SUBJECT: State employees: travel reimbursement
SOURCE: Author
DIGEST: This bill prevents a state agency from prohibiting
state employees traveling on official business from using
transportation provided by a transportation network company,
such as Uber or Lyft, or lodging in a short term rental as
defined.
ANALYSIS:
Existing law:
1)Reimburses employees for all necessary and actual expenses
they incur when they travel on official state business.
AB 229
Page 2
2)Requires the Director of the of the Department of Human
Resources (CalHR) to adopt general rules and regulations that
limit the amount, time, and place of expenses and allowances
to be paid to officers, employees, experts, and agents of the
state while traveling on official state business.
This bill:
1)Prevents a state agency from prohibiting state employees
traveling on official business from using transportation
provided by a transportation network company or lodging in a
short term rental.
2)Defines "short-term rental" as a residential property that is
rented to a visitor for fewer than 30 days through a
centralized online platform whereby the rental is advertised
and payments for the rental are securely processed and
maintains commercial liability insurance providing coverage
for claims of bodily injury or property damage arising from
the short-term rental stay in an amount not less than five
hundred thousand dollars ($500,000) per occurrence.
3)Specifies that for purposes of travel reimbursement, a
short-term rental shall be considered a commercial lodging
establishment.
4)Defines a "transportation network company" as an organization,
including, but not limited to, a corporation, limited
liability company, partnership, sole proprietor, or any other
entity, operating in California that provides prearranged
transportation services for compensation using an
online-enabled application or platform to connect passengers
with drivers using a personal vehicle.
5)Provides that reimbursement shall be provided for necessary
and actual expenses, consistent with the agency's policies for
reimbursement of other lodging establishments or other
vehicles for hire.
6)Encourages the University of California to adopt travel
reimbursement policies in accordance with the provisions of
this bill.
7)Contains a sunset date of January 1, 2019.
AB 229
Page 3
Background
Purpose of the bill. According to the author, "There are over
271,000 active state employees in various state departments and
agencies; another 92,000 UC employees, and many of them travel
for their work. While the vast majority of travelling employees
turn to hotels and taxi companies for ground travel and lodging,
some employees do use sharing economy services. Sharing economy
technology platforms are growing in popularity and can provide
economical options for ground travel and lodging. For example,
one analysis shows consumers can save up to 50% when lodging
through an online home-sharing platform. Similarly, savings can
be achieved through ride-sharing options depending on the
region. Peer-to-peer services also provide an environmentally
conscious option for ground travel"
The author further argues that, "as these innovative platforms
become more ubiquitous, it is important for the state's policies
to adjust and conform to the progressive market-place. As the
home and incubator of the sharing economy, it is critical
California's regulations are as innovative as the industry
itself. AB 229 puts California at the forefront of the sharing
economy by ensuring state employees can take full advantage of
environmentally friendly peer-to-peer services and provides an
opportunity to realize savings for the state as more employees
turn to peer-to-peer services and thereby reducing total
expenditures for travel related activity."
Current CalHR rules. Current CalHR rules as well as memorandums
of understanding (MOUs) with employee bargaining units do not
currently prohibit the use of transportation network companies
or short-term rentals for employees traveling on state business.
These documents do not name either of these types of services
when setting requirements.
Instead, rules and MOUs set lodging reimbursement maximum rates
by location and require travelers to submit itemized receipts
when claiming reimbursements. Rules and MOUs specify that to
qualify for reimbursements, lodging must be in commercial
lodging establishments. This bill specifies, for purposes of
the section added by this bill, that short-term rentals are
considered commercial lodging establishments. Additionally,
this bill would not allow agencies to ban the use of short-term
AB 229
Page 4
rental arrangements like Airbnb, which allows participants to
rent out their homes or rooms in their homes for a specified
number of nights.
Currently when state employees use taxis while traveling,
depending on their employee group, they are either not required
to submit taxi receipts or must only submit them when the ride
exceeds $10.
Prior/Related Legislation
AB 2293 (Bonilla, Chapter 389, Statutes of 2014) established
guidelines for insurance coverage for Transportation Network
Companies to ensure personal and financial safety of consumers.
FISCAL EFFECT: Appropriation: No Fiscal
Com.:YesLocal: No
SUPPORT: (Verified8/25/15)
Children's Law Center of California
The Internet Association
Natural Resources Defense Council
OPPOSITION: (Verified8/25/15)
Association of California Insurance Companies
National Association of Mutual Insurance Companies
Pacific Association of Domestic Insurance Companies
ARGUMENTS IN SUPPORT: The Internet Association argues that
"AB 229 recognizes the value of the emerging sharing economy and
how it could be used to reduce state costs relating to travel.
Providing the ability for state employees to use sharing economy
services and receive reimbursement would increase the number of
safe and reliable options available to employees when they
travel on state business. In addition, AB 229 is in alignment
with state travel policies requiring employees to use the least
costly travel methods."
AB 229
Page 5
ARGUMENTS IN OPPOSITION: Opponents of the bill argue that
"as proposed, the commercial policy must be $500,000 and
narrowly specifies what is covered. It is well publicized that
most short term rental hosts are either homeowners or renters.
Simply put, these hosts do not have the financial backing of a
hotel or motel ownership, and therefore may forgo buying any
insurance when participating in a short term rental activity."
ASSEMBLY FLOOR: 74-0, 5/22/15
AYES: Achadjian, Travis Allen, Baker, Bigelow, Bloom, Bonilla,
Bonta, Brough, Brown, Burke, Calderon, Campos, Chang, Chau,
Chávez, Chiu, Chu, Cooley, Cooper, Dababneh, Dahle, Daly,
Dodd, Eggman, Frazier, Beth Gaines, Gallagher, Cristina
Garcia, Eduardo Garcia, Gatto, Gipson, Gomez, Gonzalez,
Gordon, Gray, Grove, Hadley, Harper, Roger Hernández, Holden,
Irwin, Jones-Sawyer, Kim, Lackey, Levine, Linder, Lopez, Low,
Maienschein, Mathis, Mayes, McCarty, Medina, Melendez, Mullin,
Nazarian, Obernolte, Patterson, Perea, Quirk, Rendon,
Ridley-Thomas, Rodriguez, Salas, Santiago, Steinorth, Mark
Stone, Thurmond, Ting, Wagner, Wilk, Williams, Wood, Atkins
NO VOTE RECORDED: Alejo, Jones, O'Donnell, Olsen, Waldron,
Weber
Prepared by:Felipe Lopez / G.O. / (916) 651-1530
8/26/15 10:19:12
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