BILL ANALYSIS Ó
AB 2280
Page 1
CONCURRENCE IN SENATE AMENDMENTS
AB
2280 (Ridley-Thomas)
As Amended August 15, 2016
2/3 vote. Urgency
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|ASSEMBLY: | | (June 2, |SENATE: |38-0 |(August 30, |
| | |2016) | | |2016) |
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(vote not relevant)
Original Committee Reference: H.&C.D.
SUMMARY: Authorizes the Los Angeles International Airport to
require rental companies to charge customer facility fees for
specified purposes, subject to an independent audit and time
limitation.
The Senate amendments delete the Assembly version of this bill,
and instead:
1)Authorize the Los Angeles International Airport to impose a
customer facility charge for the purpose of financing,
constructing, designing, or otherwise improving consolidated
airport vehicle rental facilities and common-use
transportation systems that move passengers between airport
AB 2280
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terminals and those consolidated vehicle rental facilities,
and to acquire vehicles for use in that system. Specify that
this authority shall become inoperative when bonds, capital
contributions, availability payment contracts, lease
agreements, or other forms for financing are paid or
reimbursed, and that the maximum term for financing shall not
exceed 35 years.
2)Provide that the aggregate amount to be collected shall not
exceed the reasonable costs, as determined by an audit by an
independent auditor paid for by the airport, to finance,
design, construct, operate, maintain, or otherwise improve, as
applicable, those facilities, systems, and modifications.
Specify that the auditor shall independently examine and
substantiate the necessity for, and the amount of, the
customer facility charge and that a copy of the audit shall be
provided to the Assembly and Senate Committees on Judiciary,
the Assembly Committee on Transportation, and the Senate
Committee on Transportation and Housing and shall be posted on
the airport's Internet Web site.
3)Make legislative findings and declarations as to the necessity
of a special statute for the Los Angeles International
Airport.
4)Specify that the provisions of this bill shall not apply to
any fee, including an alternative fee, required by an airport
other than the Los Angeles International Airport to be
collected by a rental company from a renter.
5)Declare that this bill shall take effect immediately as an
urgency statute.
EXISTING LAW:
1)Sets forth general rules governing contracts between rental
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car companies and their customers on a variety of matters,
including, but not limited to, the authority of airports to
require rental car companies to charge customers a fee to
construct and operate consolidated rental car facilities at
the airport. (Civil Code Section (CIV) 1936; subsequent
citations refer to the Civil Code unless otherwise indicated.)
2)Permits a rental car 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, and requires the airport to conduct
audits as specified. (CIV 1936 (l).)
3)Defines a "customer facility charge" (CFC) to mean any fee
required by an airport to be collected by a rental car company
from a renter to finance, design, and construct consolidated
airport car rental facilities and to operate common-use
transportation systems that move passengers between airport
terminals and those consolidated car rental facilities, and to
acquire vehicles for use in that system. (CIV 1936 (a).)
FISCAL EFFECT: None
COMMENTS: This bill replicates a provision that was contained
in AB 2051 ((O'Donnell), Chapter 183, Statutes of 2016), a bill
heard by the Judiciary Committee earlier this session. AB 2051
sought to reorganize the statute (CIV 1936) that governs rental
car contracts, fees, disclosures, and advertisements. The bill
also contained a number of substantive provisions, most notably
provisions relating waiver of liability notices and the ability
of rental car companies to use a rental vehicle's GPS technology
to locate lost vehicles. The bill also contained a provision
that authorized Los Angeles International Airport (LAX) to
require rental car companies to charge a "customer facility
charge" (CFC) to help finance the design, construction, and
improvement of consolidated rental car facilities and the
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transportation systems that move passengers from those
facilities to the airport terminal. Generally speaking,
consolidated rental car facilities are economically and
environmentally preferable, not to mention more convenient, than
having rental car companies scattered at different points around
the periphery of the airport. The bill, including the provision
authorizing LAX to impose a CFC, passed out of the Judiciary
Committee on consent. However, the bill was amended in the
Senate to remove the LAX fee authorization. Apparently, this
provision was removed from AB 2051 in light of questions raised
in the Senate Judiciary Committee analysis about the lack of any
limitation on the duration of the authority and the possibility
that the fee authority could be used as an unending source of
revenue for LAX.
Bill Addresses Senate Committee Concerns: After the LAX fee
authorization was deleted from AB 2051, its essential provisions
were placed into this bill. There is, however, one important
difference between this bill and the provision that was deleted
from AB 2051. In order to address the concerns about the lack
of any time limitation on the fee authority, the current bill
specifies that the CFC authority shall become inoperative once
the bonds, capital contributions, or other forms for financing
are paid or reimbursed, and in any event the maximum term for
financing shall not exceed 35 years. In short, the Judiciary
Committee already passed the essential provisions of this bill -
granting LAX authority to require a CFC to finance consolidated
car rental facilities - when it passed AB 2051, with the
exception that this bill appropriately adds a time limitation on
that fee authority.
Background: In 1999, the Legislature passed and the Governor
signed SB 1228 ((Vasconcellos), Chapter 760, Statutes of 1999),
which gave the San Jose International Airport the authority to
require rental car companies to charge customers a customer
facility fee , for the purpose of financing a consolidated
rental car facility. In subsequent years, additional airports
were granted such authority so long as specified conditions were
met, including a requirement that the airport conduct an audit
in order to ensure that the fees were reasonable and properly
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used. Since the initial legislation was enacted, airport
authorities have used this tool to reap the many benefits of
having rental car facilities in a single location serviced by a
common transportation system, as opposed to having rental car
companies spread out in various places around the periphery of
the airport. Not only do consolidated rental car facilities
move passengers more efficiently and conveniently to their
respective destinations, but they also have economic and
environmental advantages.
This bill would authorize LAX - one the busiest airports in the
world - to impose a CFC in order to design, construct, operate,
and improve a consolidated car rental facility and a common
transportation system to service the consolidated facility.
Consistent with past authorizations, this bill would require an
audit and report to the Legislature in order to ensure that fees
are reasonably related to costs. Finally, this bill provides
that the CFC authority shall become inoperative once the bonds
or other financing mechanism are paid or reimbursed, and in any
event the authority shall not exceed 35 years.
Analysis Prepared by:
Thomas Clark / JUD. / (916) 319-2334 FN:
0004977