BILL ANALYSIS Ó
SENATE COMMITTEE ON APPROPRIATIONS
Senator Ricardo Lara, Chair
2015 - 2016 Regular Session
AB 650 (Low) - Public Utilities Commission: regulation of
taxicabs
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|Version: June 23, 2016 |Policy Vote: G.O. 13 - 0, E., |
| | U., & C. 9 - 0, T. & |
| | H. 9 - 0 |
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|Urgency: No |Mandate: Yes |
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|Hearing Date: August 8, 2016 |Consultant: Narisha Bonakdar |
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This bill meets the criteria for referral to the Suspense File.
Bill
Summary: AB 650 transfers regulatory oversight of taxicabs from
local governments to the California Public Utilities Commission
(CPUC) and generally provides for more flexibility in taxicab
operations.
Fiscal
Impact:
One-time costs of approximately $200,000 (Transportation
Reimbursement Account) to the CPUC for information technology
updates.
Ongoing cost of approximately $2.8 million annually
(Transportation Reimbursement Account) for staff to implement
the program. Some or all of this cost will be offset by
permit application fees.
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Unknown increase in penalty revenue.
Background: Since its inception in 1911 (then as the Railroad Commission),
the CPUC has regulated private companies and individuals that
own, operate, control, or manage transportation of people and
property. However, taxicabs have been regulated by local cities
or counties for most of the CPUC's one hundred year history.
Currently, the CPUC's remaining authority is limited to non-rail
passenger carriers and household goods movers. Under state law,
the CPUC is required to license carriers, and investigate and
enforce safety and consumer protection laws for the following
surface transportation carriers:
Passenger Stage Corporations (PSCs) - For-hire carriers
transporting passengers over public highways on an
individual-fare basis (e.g., airport shuttles).
Transportation Charter-Party Carriers (TCPs) - Operate under
the direction and control of their chartering party that
arranges the transportation, on a prearranged basis (e.g.,
tour buses, limousines, and transportation network companies).
Private Carriers of Passengers (PCPs) - Not-for-hire motor
carrier transporting passengers in buses (vehicles seating 10
or more) that are required to obtain a "CA number" from CHP.
Household Goods Carriers - For-hire moving companies.
The rapid growth of a new transportation for-hire service, known
as transportation network companies (TNCs), has raised questions
about the fairness of the disparity between existing regulations
of taxicabs compared to competitors in TNCs which have far fewer
requirements. This is one of many proposals over the past few
years to resolve this disparity.
Proposed Law:
1) This bill:
1) Establishes the Taxicab Transportation Services Act and
places taxicabs under the regulatory authority of the CPUC,
except in the City of San Francisco.
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2) Requires the CPUC to issue permits, or renewals that are
effective for three years.
3) Maintains the current requirement on taxicab services to
include the number of its permit in every written, oral, or
electronic advertisement of the services it offers and
requires compliance with the signing requirements in the
Vehicle Code.
4) Requires the CPUC to ensure all applicants meet the
following requirements prior to issuing a taxicab service
permit:
a) Ensuring the financial and organizational capacity
of the entity.
b) Compliance with the rules and regulations of the
Department of the California Highway Patrol relating to
safe operating vehicles.
c) Commitment to observe hours of service regulations
of state and federal law.
d) Establishment of an inspection program in effect for
its motor vehicles.
e) Participation in the pull-notice program.
f) Establishment of a safety education and training
program for all drivers.
g) Establishment of a mandatory controlled substance
and alcohol testing certification program.
h) Establishment of a disabled access education
program.
1) Prohibits rates structures that provide difference costs
based on race, national origin, religion, color, ancestry,
physical handicap, medical condition, occupation, marital
status or change in marital status, sex, or any other
characteristic.
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2) Requires every taxicab carrier to furnish a list to the
CPUC of all motor vehicles used by the carrier in taxicab
services since the last inspection.
3) Authorizes the CPUC to suspend or revoke the carrier's
permit and/or impose a fine if the carrier's insurer informs
the CPUC that the carrier has failed to obtain insurance
coverage for any vehicle on the list.
4) Requires the CPUC to investigate any entity that
advertises as a taxi transportation service without the
required permit.
5) Establishes grounds by which the CPUC may cancel, suspend,
or revoke a taxicab carrier permit, and authorizes the CPUC
to levy a civil penalty of up to $7,500.
6) Requires a taxicab carrier to make a certificate of
workers' compensation coverage, a consent to self-insure
issued by the Department of Industrial Relations, or a
statement under penalty of perjury available for CPUC
inspection, upon request.
7) Requires a taxicab carrier to operate a motor vehicle with
the CPUC required identifying markings.
8) Requires every city or county to forward to the CPUC
licensure information for each taxicab transportation
service licensee within its jurisdiction by December 31,
2016.
9) Requires taxicab carrier to procure liability insurance
capped at no more than $100,000 for death and personal
injury per person, $300,000 for death and personal injury
per incident, and $50,000 for property damage. The CPUC may
increase these levels.
10) Authorizes the CPUC to adopt rules requiring taxicab
carriers to disclose fares, fees, and other pricing
structures for taxicabs.
11) Requires an individual who wishes to be a driver providing
taxicab services to first obtain a taxicab driver's permit
from the CPUC. The permit shall be valid statewide, except
AB 650 (Low) Page 4 of
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in San Francisco. In order to obtain the permit the driver
must be 18 years or older, possess a Class C driver's
license, pass a CPUC prescribed written exam, and pass a
background check through the Department of Justice's Live
Scan system.
12) Requires a taxicab carrier to participate in the
pull-notice system, and provide for a mandatory
controlled-substance and alcohol testing certification
program equivalent to that required by the CPUC of
transportation network companies.
13) Prohibits a taxicab carrier from employing or contracting
drivers who have been convicted during the preceding seven
years of any offense relating to the use, sale, possession,
or transportation of narcotics; any act involving violence;
any sexual offense, fraud, felony offense, or offense
involving possession of a firearm; and other actions.
14) Requires a taxicab carrier to inspect each of its motor
vehicles or have each vehicle inspected at a facility
licensed by the Bureau of Automotive Repair, and requires
the inspection to cover 19 specified components of the
vehicle.
15) Preempts all other regulation of taxicab transportation
services, including those by local agencies.
Related
Legislation: AB 1289 (Cooper, 2016) requires a transportation
network company (TNC) to conduct comprehensive criminal
background checks for each participating driver. The background
check must include a multistate, multijurisdictional criminal
records locator and a search of the US Department of Justice
National Sex Offender Public Website (public website). The bill
also prohibits a TNC from retaining a driver who is registered
on the sex offender website or has been convicted of any violent
felony, sexual offense, or a driving under the influence (within
the past seven years). This bill is on the Senate Floor.
Staff Comments: According to the author, "California's current
taxi regulation process is antiquated and extremely onerous.
Taxis are the only for-hire transportation model that is fully
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regulated at the local level, while other for-hire
transportation models have one set of statewide requirements
governing their operation. This disparity places taxis at a
severe competitive disadvantage. The laws and regulations
governing the provision of transportation services are many
decades old and have evolved slowly. As with many new
technologies, the rapid growth of TNCs has created a disruption
in the taxi's archaic model of transportation. While this change
has created many benefits to transportation customers, it has
also created an unfair disadvantage for taxis to compete in the
market. In order to compete in the changing for-hire
transportation ecosystem, taxis should be regulated by one
statewide set of standards because the current system restricts
competition by setting different, more onerous rules for taxis."
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