BILL ANALYSIS                                                                                                                                                                                                    Ó



                                                                    AB 1289


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          CONCURRENCE IN SENATE AMENDMENTS


          AB  
          1289 (Cooper)


          As Amended  August 19, 2016


          Majority vote


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          Original Committee Reference:  PUB. S.


          SUMMARY:  Requires a Transportation Network Company (TNC) to  
          conduct a criminal background check for each participating  
          driver.


          The Senate amendments delete the previous content of this bill  
          and replace it with the following:


          1)Require a TNC to conduct, or have a third party conduct, a  
            local and national criminal background check for each  
            participating driver that including the following:


             a)   A multistate and multijurisdictional criminal records  
               locator or other similar commercial nationwide database  
               with validation; and 









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             b)   A search of the United States Department of Justice  
               National Sex Offender Public Web site.


          2)Prohibit a TNC from contracting with, employing, or retaining  
            a driver if he or she meets either of the following criteria:
             a)   Is currently registered on the United States Department  
               of Justice National Sex Offender Public Web site; or
             b)   Has been convicted of specified felonies. 


          3)Prohibit a TNC from contracting with, employing, or retaining  
            a driver if he or she has been convicted of any of the  
            following offenses within the previous seven years:
             a)   Misdemeanor assault or battery; 
             b)   A domestic violence offense;


             c)   Driving under the influence of alcohol or drugs; or


             d)   A felony violation, as specified.


          4)Subject a TNC that violates, or fails to comply with, the  
            specified requirements, to a penalty of not less than $1,000  
            nor more than $5,000 for each offense. 
          5)Authorize an investigative consumer reporting agency to  
            furnish an investigative consumer report to a TNC about a  
            person seeking to become a participating driver, regardless of  
            whether the participating driver is to be employee or an  
            independent contractor of the TNC.


          


          EXISTING LAW: 


          1)Establishes the "Passenger Charter-Party Carriers Act," which  








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            directs the CPUC to issue permits or certificates to Charter  
            Party Carriers (CPCs), investigate complaints against  
            carriers, and cancel, revoke, or suspend permits and  
            certificates for specific violations. (Public Utilities Code  
            Section (PUC) 5381 et seq.) 


          2)Defines a "transportation network company" to mean 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. (PUC 5431) 


          3)Requires the Department of Justice (DOJ) to furnish state  
            summary criminal history information to specified entities, if  
            needed in the course of their duties and, when specifically  
            authorized, federal-level criminal history information, upon  
            showing of a compelling need, provided that when information  
            is furnished to assist an agency, officer, or official of  
            state or local government, a public utility, or any other  
            entity in fulfilling employment, certification, or licensing  
            duties, as specified. (Penal Code Section (PEN) 11105)


          4)Authorizes the DOJ or any state or local law enforcement  
            agency to require the submission of fingerprints for the  
            purpose of conducting summary criminal history information  
            checks that are authorized by law. (PEN 11105) 



          5)Requires, notwithstanding any other law, whenever state  
            summary criminal history information is initially furnished,  
            as specified, the DOJ to disseminate the following  
            information:



             a)   Every conviction rendered against the applicant.








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             b)   Every arrest for an offense for which the applicant is  
               presently awaiting trial, whether the applicant is  
               incarcerated or has been released on bail or on his or her  
               own recognizance pending trial.



             c)   Every arrest for an offense for which the records of the  
               DOJ do not contain a disposition or did not result in a  
               conviction, provided that the DOJ first makes a genuine  
               effort to determine the disposition of the arrest.   
               However, information concerning an arrest shall not be  
               disclosed if the records of the DOJ indicate or if the  
               genuine effort reveals that the subject was exonerated,  
               successfully completed a diversion or deferred entry of  
               judgment program, or the arrest was deemed a detention.



             d)   Every date and agency name associated with all retained  
               peace officer or nonsworn law enforcement agency employee  
               preemployment criminal offender record information search  
               requests.



             e)   Sex offender registration status of the applicant.  (PEN  
               11105)


          FISCAL EFFECT:  According to the Senate Appropriations  
          Committee, pursuant to Senate Rule 28.8, negligible state costs.


          


          COMMENTS:  









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          1)Background:  California Constitution, Article XII establishes  
            the CPUC and grants it the authority to regulate public  
            utilities.  In addition, the CPUC has more limited authority  
            over other corporations, including railroads, rail transit,  
            and CPCs, among others.  Beginning as early as 2009, a new  
            model of transportation known as TNCs allowed patrons to  
            prearrange transportation services through an online  
            application on their smartphone or computer.  Although TNCs do  
            not neatly fall into the conventional definition of a CPC, the  
            CPUC believes that TNCs are currently providing passengers  
            transportation for compensation, and reasonably concludes that  
            TNCs are CPCs, therefore, falling under the CPUC's existing  
            jurisdiction over such services. 


          2)Criminal Background Checks:  CPUC regulations require TNCs to  
            run criminal background checks on all hired drivers, but it  
            does not specify the parameters for which TNCs must go about  
            doing these background checks.  There are various forms of  
            background checks ranging from simple name checks to  
            fingerprint checks that are run through the Federal Bureau of  
            Investigation database or through a state or local level law  
            enforcement database. 


            TNCs generally contract with third party firms that they argue  
            provide a more comprehensive review necessary to ensure  
            passenger safety.  For example, Uber argues that its  
            background screening process checks primary sources and court  
            records going back seven years, in addition to other national  
            databases.  However, news reports continue to identify  
            situations in which TNC drivers have been accused of criminal  
            situations such as rape, assault, kidnapping, among others.   
            The CPUC currently has a pending rulemaking process examining  
            TNC regulations, including whether or not to require  
            fingerprints as part of the TNC background checks. 


            This bill would require TNCs to conduct, or have a third party  
            conduct, a local and national criminal background check for  
            each participating driver that includes:  a) a multistate and  








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            multijurisdictional criminal records locator or other similar  
            commercial nationwide database with validation, and b) a  
            search of the United States Department of Justice National Sex  
            Offender Public Web site.


            This bill prohibits a TNC from contracting with, employing, or  
            retaining a driver if he or she is currently registered on the  
            United State Department of Justice National Sex Offender  
            Public Web site, has been convicted of specified felonies, or,  
            within the previous seven years, has been convicted of a  
            misdemeanor assault or battery, a domestic violence offense,  
            driving under the influence of alcohol or drugs, or a  
            specified felony violation.  This bill subjects a TNC that  
            violates, or fails to comply with, the specified requirements,  
            to a penalty of not less than $1,000 nor more than $5,000 for  
            each offense.


          Analysis Prepared by:                                             
                          Edmond Cheung / U. & C. / (916) 319-2083  FN:   
          0004828