BILL ANALYSIS                                                                                                                                                                                                    Ó



                                                                     AB 873


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          CONCURRENCE IN SENATE AMENDMENTS


          AB  
          873 (Jones)


          As Amended  August 19, 2016


          Majority vote


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          Original Committee Reference:  B. & P.


          SUMMARY:  Requires the Bureau of Automotive Repair (BAR) to  
          adopt regulations defining minor services that may be performed  
          on an automobile without registration; deletes, commencing  
          January 1, 2018, the current list of minor automotive services  
          and specifies that, at the time, the BAR's prior regulations  
          will remain in effect but may be amended as necessary; and makes  
          conforming changes.


          The Senate amendments add chaptering language that makes this  
          bill contingent on the enactment of SB 778 (Allen) of the  
          current Legislative Session.


          FISCAL EFFECT:  According to the Senate Appropriations  
          Committee: 










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          1)One-time costs less than $150,000 for the BAR (under the  
            Director of Consumer Affairs) to develop and adopt regulations  
            defining minor repairs (Vehicle Inspection and Repair Fund).


          2)Ongoing costs of about $200,000 per year to register and  
            regulate about 1,000 additional businesses that would be  
            required to register under a new definition of minor repairs  
            (Vehicle Inspection and Repair Fund).  According to the  
            Bureau, a revised definition of minor repairs would not likely  
            continue to exempt tire dealers and oil change shops.   
            According to the Bureau, there are about 1,000 such businesses  
            in the state that are not already registered with the Bureau.   
            The costs to register and take any necessary enforcement  
            actions against the newly registered businesses would be  
            offset by the current $200 annual registration fee imposed by  
            the Bureau.


          COMMENTS:


          Purpose.  This bill is sponsored by the author.  According to  
          the author, this bill "will require the [BAR], within the  
          [Department of Consumer Affairs], to determine through  
          regulation which automotive services are minor and which  
          necessitate oversight. 


          "The Automotive Repair Act of 1971 has not been significantly  
          update[d] since it was enacted.  Existing law should be updated  
          and a determination of what constitutes minor repair work and  
          major repair should be developed through the formal rulemaking  
          process so that: 


          1)The [BAR] takes a comprehensive technical approach to  
            determine what business practices necessitate registration as  
            an automotive repair dealer; and 


          2)This determination can be periodically updated through the  








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            rulemaking process, as the automotive industry continues to  
            evolve.  This approach allows the industry to participate  
            through the rulemaking process to help determine which  
            services are minor and should be excluded from registration  
            and which services are major and require registration."


          Background.  The Automotive Repair Act requires automotive  
          repair dealers who engage in the business of repairing or  
          diagnosing malfunctions of motor vehicles to be licensed and  
          registered with the BAR.  It also defines "repair of motor  
          vehicles" as any maintenance and repair work performed by an  
          automotive repair dealer, including body repair work, but as  
          excluding:  1) repairs made under a commercial business  
          agreement; 2) repairing tires and changing tires; 3) lubricating  
          vehicles; 4) installing light bulbs, batteries, windshield wiper  
          blades and other minor accessories; 5) cleaning, adjusting, and  
          replacing spark plugs; 6) replacing fan belts, oil, and air  
          filters; and 7) other minor services customarily performed by  
          gasoline service stations.


          Minor Services.  During the BAR's 2014 sunset review oversight  
          hearing, the BAR raised the issue of whether certain ancillary  
          services that are not subject to registration should be.   
          Historically, these services were viewed as simple services that  
          were often performed at gasoline service stations and carried a  
          lower risk of consumer harm.  However, the BAR noted that,  
          because of advances in automotive technology, many of the  
          services require specialized repair skills and may require the  
          removal of automotive systems, engine components, shrouds or  
          other electrical equipment. 


          One of the examples cited by the BAR was tire services.  The  
          federal Transportation Recall Enhancement, Accountability and  
          Documentation (TREAD) Act requires that new vehicles of a  
          specified weight be equipped with a Tire Pressure Monitoring  
          System (TPMS).  When a vehicle with a TPMS is serviced, the  
          technician may need specialized training, such as on how to  
          update the vehicle's on-board diagnostic system.  A  
          malfunctioning TPMS can lead to tire blowouts, undetected slow  








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          leaks, and other dangerous conditions.


          Another example was spark plugs.  According to the BAR, some  
          vehicle manufacturers have made spark plugs inaccessible without  
          removal of other major systems, such as the removal of motor  
          mounts or parts of entire engine.  Because failure to perform  
          these services correctly can result in serious harm to  
          consumers, the BAR believes that an automotive repair dealer  
          registration should be required to perform those types of  
          repairs.  This bill would authorize the BAR to update the list  
          of minor services through regulations. 


          Propulsive Batteries.  According to stakeholders, propulsive  
          batteries are batteries that power or fuel a vehicle's movement,  
          such as in an electric automobile.  Ordinary car batteries only  
          power various electronics within a vehicle, such as the starter  
          and interior or exterior lights.  Because a propulsive battery  
          requires specialized training, this bill excludes propulsive  
          batteries from the list of minor services.


          Analysis Prepared by:                                             
                          Vincent Chee / B. & P. / (916) 319-3301  FN:   
          0004862