BILL ANALYSIS                                                                                                                                                                                                    Ó

          |SENATE RULES COMMITTEE            |                       AB 1432|
          |Office of Senate Floor Analyses   |                              |
          |(916) 651-1520    Fax: (916)      |                              |
          |327-4478                          |                              |

                                   THIRD READING 

          Bill No:  AB 1432
          Author:   Bonta (D), et al.
          Amended:  5/11/16 in Senate
          Vote:     21 

           SENATE GOVERNMENTAL ORG. COMMITTEE:  9-3, 7/14/15
           AYES:  Hall, Block, Galgiani, Glazer, Hernandez, Hill, Hueso,  
            Lara, McGuire
           NOES:  Gaines, Runner, Vidak
           NO VOTE RECORDED:  Berryhill

           AYES:  Lara, Beall, Hill, Leyva, Mendoza, Nielsen
           NOES:  Bates

           ASSEMBLY FLOOR:  78-0, 4/23/15 (Consent) - See last page for  

           SUBJECT:   Monterey Bay and the Bays of San Francisco, San  
                     Pablo, and Suisun:  pilotage rates:  technology  

          SOURCE:    Author
          DIGEST:    This bill authorizes until January 1, 2021 a  
          technology surcharge, not to exceed a cumulative amount of $1.2  
          million, to recover a pilot's costs for the purchase or lease of  
          navigation hardware and software to enhance navigation safety.

          Senate Floor Amendments of 5/11/16 gut the contents of the  
          existing bill relating to across-the-board pilotage rate  
          increases, as specified, as well as a similar technology  


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          surcharge provision.

          Existing law:

          1)Provides for the regulation and licensure of pilots for  
            Monterey Bay and the Bays of San Francisco, San Pablo, and  
            Suisun by the Board of Pilot Commissioners (Board) within the  
            Transportation Agency.

          2)Specifies that the Board shall consist of seven members  
            appointed by the Governor and one ex-officio non-voting member  
            (the Secretary of the Transportation Agency).  Two members are  
            pilots licensed by the Board; two are industry members (one  
            from the tanker industry and one from the dry cargo industry);  
            and, three public members who are neither pilots nor work for  
            companies that use pilots.

          3)Prescribes the rates of pilotage fees required to be charged  
            by pilots and paid by vessels.  The rates involved are set  
            forth in Sections 1190 and 1191 of the Harbors and Navigation  
            Code.  Section 1190 relates to bar pilotage for every vessel  
            inward or outward bound over the San Francisco Bar, which lies  
            west of the Golden Gate Bridge, and charges vary, depending on  
            a vessel's gross registered tonnage and draft.  Section 1191  
            of the Harbors and Navigation Code relates to charges for  
            transits that originate and are concluded inland of Golden  
            Gate Bridge - charges for these transits are flat amounts,  
            with the amounts varying with the places at which the transit  
            begins and ends.   

          4)Stipulates that the Board shall recommend that the  
            Legislature, by statute, adopt a schedule of pilotage rates  
            providing fair and reasonable return to pilots engaged in ship  
            movements or special operations if rates for those movements  
            or operations are not specified in Section 1190 of the Harbors  
            and Navigation Code.

          5)Provides for a movement fee as is necessary and authorized by  
            the Board to recover a pilot's costs for the purchase, lease,  
            or maintenance of navigation software, hardware, and ancillary  
            equipment purchased after November 5, 2008 and before January  
            1, 2011.  


                                                                    AB 1432  
                                                                    Page  3

          This bill:

          1)Reinstitutes, until January 1, 2021, a technology surcharge,  
            not to exceed a cumulative amount of $1.2 million to recover a  
            pilot's costs for the purchase, lease, or maintenance of  
            navigation software, hardware, and ancillary equipment that is  
            authorized by the Board as reasonable and necessary on or  
            after January 1, 2017.

          2)Makes it explicit that the software, equipment, and technology  
            shall be used strictly and exclusively to aid in piloting on  
            the pilotage grounds.

          3)Requires the Board to review and adjust as necessary the  
            navigation technology surcharge at least quarterly.

          4)Makes other conforming code maintenance changes.  

          Brief historical perspective.  Bar pilots have been guiding  
          ships into San Francisco Bay, one of the most treacherous  
          passages in the world, since at least 1835.  The work that bar  
          pilots performed was so important that one of the first  
          legislative enactments by the newly formed California  
          Legislature that met in San Jose in 1850 was to address the  
          regulation of bar pilots.

          California's history of piloting parallels to a large extent the  
          history of pilotage throughout the United States.  Prior to the  
          American Revolution, pilotage was regulated by colonial  
          legislatures.  They generally provided for the commissioning of  
          pilots, apprenticeship requirements to become a pilot, specified  
          the type and size of pilot boats used in the service, and  
          established fees to be charged.  When the United States  
          Constitution was adopted, it recognized that pilotage fell  
          within the domain of the federal government because it involved  
          regulation of instruments of foreign commerce.  One of the first  
          acts of the newly formed Congress in 1789 was to recognize the  
          existing state laws regulating pilots and delegate to the states  
          the authority to continue to regulate pilotage because of its  
          unique character.


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          Bar pilots are responsible for steering an arriving vessel  
          through the Golden Gate of San Francisco Bay, the Bay waters and  
          adjoining navigable waters, which include San Pablo Bay, Suisun  
          Bay, the Sacramento River and its tributaries.  When a vessel  
          approaches the "SF" buoy several miles west of the Golden Gate  
          Bridge, a bar pilot boards the ship and takes navigational  
          control.  (Pilots in San Francisco are called "Bar Pilots"  
          because they board and disembark ships just beyond a treacherous  
          sand bar which provides a natural obstacle to shipping.)  It  
          becomes the pilot's responsibility to guide the ship to its  
          berth.  The bar pilots provide service to all types of vessels,  
          from 100-foot tugs to 1000-foot supertankers.

          Pilots are generally mandatory in every major port throughout  
          the world and their pilotage service is paid for by the vessel  
          owner/agent.  As noted above, the San Francisco Bar Pilots have  
          been state regulated and licensed since 1850 to pilot vessels to  
          various ports in the Bay Area such as San Francisco, Oakland,  
          Redwood City, Martinez, Richmond, Pittsburgh, Vallejo, Rodeo,  
          Antioch, Stockton, Sacramento and more recently including  

          Purpose of AB 1432.  According to the author's office, this bill  
          simply reflects an agreement reached between the San Francisco  
          Bar Pilots and the Pacific Merchant Shipping Association to  
          re-establish the navigation technology surcharge which was  
          allowed to sunset in 2011.   

          Prior Legislation
          SB 300 (Yee, Chapter 497, Statutes of 2009) among other things,  
          established a surcharge for payment of navigational aids for bar  

          FISCAL EFFECT:                 Appropriation:  Yes    Fiscal  
          Com.:             Yes          Local:          No

          Unknown with latest amendments.

          SUPPORT:  (Verified  5/12/16)

          Pacific Merchant Shipping Association


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          San Francisco Bar Pilots 

          OPPOSITION:  (Verified  5/12/16)

          None received

          ASSEMBLY FLOOR:  78-0, 4/23/15
          AYES:  Achadjian, Alejo, Travis Allen, Baker, Bigelow, Bloom,  
            Bonilla, Bonta, Brough, Brown, Burke, Calderon, 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, Jones-Sawyer, Kim, Lackey, Levine, Linder,  
            Lopez, Low, Maienschein, Mathis, Mayes, McCarty, Medina,  
            Melendez, Mullin, Nazarian, Obernolte, O'Donnell, Olsen,  
            Patterson, Perea, Quirk, Rendon, Ridley-Thomas, Rodriguez,  
            Santiago, Steinorth, Mark Stone, Thurmond, Ting, Wagner,  
            Waldron, Weber, Wilk, Williams, Wood, Atkins
          NO VOTE RECORDED:  Campos, Salas

          Prepared by:Arthur Terzakis / G.O. / (916) 651-1530
          5/13/16 11:54:21

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