BILL ANALYSIS Ó
AB 2051
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CONCURRENCE IN SENATE AMENDMENTS
AB
2051 (O'Donnell)
As Amended August 2, 2016
Majority vote
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|ASSEMBLY: | 78-0 | (May 12, |SENATE: | 37-0 |(August 11, |
| | |2016) | | |2016) |
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Original Committee Reference: JUD.
SUMMARY: Reorganizes the statute regulating rental car
agreements and modifies certain regulations that no longer
reflect prevailing practices in consumer and industry behavior.
Specifically, this bill:
1)Repeals the existing statutory framework that governs
agreements between a rental car company and its customers and
replaces it with a new statutory framework that eliminates
duplicative and inoperative sections, adds and updates
definitions, and modifies certain substantive requirements, as
noted below.
2)Provides that if a person or entity other than a rental
company, including a passenger carrier or travel service,
advertises a rental rate for a vehicle that includes
additional mandatory charges, that person or entity shall
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clearly disclose the existence and amount of the charges. If
a rental company provides the person or entity with a rental
rate and additional mandatory charges information, the rental
car company is not responsible for the failure of that person
or entity to comply with the disclosure requirement.
The Senate amendments:
1)Specify that a vehicle license recovery fee shall be
separately stated as a single charge in the quote and rental
contract.
2)Restore a provision requiring hangars on review mirrors that
give the renter a final notice of his or her damage waiver
options, as specified.
3)Restore existing law by extending the period after which a
rental company may use electronic surveillance technology from
three days to one week after failure to return by the
scheduled return date.
4)Eliminate a provision that allows the use of electronic
surveillance to determine the date and time the vehicle
departs from, or is returned to, the rental car company for
the sole purpose of commencing or concluding the rental.
5)Eliminate provisions authorizing specified airport facility
fees.
EXISTING LAW:
1)Sets forth general rules governing contracts between rental
car companies and their customers on a variety of matters,
including, but not limited to, the manner in which rental car
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companies advertise and quote rental charges and additional
fees, the renter's liability or lack thereof for damages to a
rental vehicle, the amount that rental car companies may
charge for damage waivers and the manner in which they are
offered, and the conditions under which a rental car company
may access, obtain, and use geo-location and other information
from the rental vehicle's electronic surveillance technology.
2)Requires a rental company that offers a damage waiver to
disclose specified information to the renter in a prescribed
manner, including an oral disclosure at the counter informing
the renter that the damage waiver may be duplicative of
coverage that the customer maintains under his or her own
motor vehicle insurance policy. Provides that a rental
company's disclosure requirements shall be satisfied for
renters who are enrolled in its membership program if certain
conditions are met, including by placing on the rental
vehicle's rearview mirror a hangar that notifies the renter
that the damage waiver may be duplicative of the coverage that
the customer maintains under his or her own insurance policy
and provides the renter a final opportunity to either decline
a damage waiver that was previously accepted or accept a
damage waiver that was previously declined.
3)Provides that when providing a quote, or imposing charges for
a rental company, the rental company may separately state the
rental rate, additional mandatory charges, if any, and a
mileage charge, if any, that a renter must pay to hire or
lease the vehicle for the period of time to which the rental
rate applies. Prohibits the rental car company from charging
any fee other than the quoted rental rate, additional
mandatory charges, or mileage charges.
4)Permits the rental company to collect an authorized customer
facility charge at specified airports if certain conditions
are met and the fees are used for purposes of maintaining a
consolidated rental car facility and a common-use
transportation system. Requires the airports to conduct
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audits as specified.
5)Prohibits a rental company from using, accessing, or obtaining
any information relating to the renter's use of the rental
vehicle that was obtained using electronic surveillance
technology, unless the technology is used to locate a stolen,
abandoned, or missing rental vehicle after one of the
following:
a) The renter or law enforcement has informed the rental
car company that the vehicle is missing or has been stolen
or abandoned.
b) The rental vehicle has not been returned following one
week after the contracted return date, or one week
following the end of an extension of that return date.
c) The rental car company discovers that the vehicle has
been stolen or abandoned and, if stolen, reports the
vehicle stolen to law enforcement by filing a stolen
vehicle report.
FISCAL EFFECT: None
COMMENTS: According to the author, this bill seeks to
"modernize" the statute that governs rental car contracts, fees,
disclosures, and advertisements. Many of the provisions in the
bill under consideration are similar, and in some cases
identical, to last year's AB 675 (Alejo), Chapter 333, Statutes
of 2015, which passed out of the Judiciary Committee
unanimously. AB 675 was eventually chaptered, but only after it
was significantly amended in the Senate to focus more narrowly
on the issue that prompted AB 675: the rental car industry's
desire to clearly distinguish the fees imposed on its customers
by a rental car company from the many government-imposed
exactions, including tourism fees, airport concession and
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facility fees, vehicle fees, and other related fees and
surcharges. Understandably, the rental car companies wanted
their customers to know which parts of the total charge were
attributable to the rental car company, and which were
attributable to additional mandatory fees over which the rental
company had no control. This bill seeks to restore some the
provisions that were in AB 675 before it was pared back in the
Senate. To the Judiciary Committee's understanding, the Senate
amendments did not necessarily reflect any fundamental
disagreement with the other changes proposed by AB 675; rather,
it reflected a desire to focus the bill on the most pressing
change sought by the author and sponsors (separating rental
company fees from government-imposed fees in quotes and
statements) and leave a more comprehensive "clean-up" and
reorganization for a later date. This bill, therefore, seeks to
achieve that reorganization while at the same time incorporating
some, but not all, of the substantive changes that were in AB
675.
Advertisers Responsibility for Disclosure: When a consumer
arranges to rent a vehicle from someone other than the rental
car company - such as an airline or travel service - this bill
would require that the other person or entity make specified
disclosures regarding any additional charges that the customer
will need to pay, so long as the rental car company provides
this information to the other person or entity. The bill also
specifies that if the other person or entity has been provided
with that information by the rental car, but the other person or
entity fails to disclose it properly, the rental company is not
responsible for that failure. In other words, this provision
apportions responsibility to the person or entity that failed to
comply with the requirements.
Analysis Prepared by:
Thomas Clark / JUD. / (916) 319-2334 FN:
0003742
AB 2051
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