BILL ANALYSIS Ó
AB 2603
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Date of Hearing: April 20, 2016
ASSEMBLY COMMITTEE ON UTILITIES AND COMMERCE
Mike Gatto, Chair
AB 2603
(Nazarian) - As Amended April 11, 2016
SUBJECT: Public Utilities Commission: Passenger Charter-party
Carriers' Act: complaint registration and resolution mechanism
SUMMARY: Requires the California Public Utilities Commission
(CPUC) to establish a telephone communication service for the
public to communicate any concern or complaints related to
charter party carriers (CPCs), including transportation network
companies (TNCs). Specifically, this bill:
1)Requires the CPUC to establish a telephone communications
service that is available to members of the public to
communicate to the CPUC any concerns, or register complaints,
regarding service provided by CPCs, including TNCs.
2)Requires the CPUC to designate a telephone number for members
of the public to dial to communicate their concerns or
complaints.
3)Requires the CPUC to require each CPC to include the telephone
number designated by the CPUC on all contracts for service
made after January 1, 2018.
4)Requires the CPUC to require that the customer, of a TNC or
other CPC that arranges for transportation utilizing
AB 2603
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application software, be notified of the existence of, and
purpose for, the telephone number as part of the electronic
transaction.
5)Authorizes the CPUC to maintain additional, alternative means
for members of the public to express concerns or register
complaints.
6)Requires the CPUC to maintain a record of all concerns and
complaints communicated to the CPUC relative to CPCs,
including TNCs.
7)Requires the CPUC to establish rules or guidelines as to what
concerns and complaints do or do not raise matters of serious
concern.
8)Requires the CPUC to diligently attempt to informally resolve
the concern or complaints, that do not raise a matter of
serious concern, and requires the CPUC to maintain a record of
whether the concern or complaint was resolved.
9)Requires the CPUC to investigate each concern or complaint
made to the CPUC that raises a matter of serious concern and
initiate and conclude appropriate enforcement action with
respect to any specified violation or a specified rule adopted
by the CPUC.
10)Requires the CPUC to maintain a record of all concerns and
complaints that result in an investigation, a description of
the investigation conducted by the CPUC, and the result of the
investigation.
EXISTING LAW:
1)Establishes the "Passenger Charter-Party Carriers Act," which
directs the CPUC to issue permits or certificates to CPCs,
investigate complaints against carriers, and cancel, revoke,
or suspend permits and certificates for specific violations.
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(Public Utilities Code Section 5381 et seq.)
2)Defines "charter party carriers of passengers" as every person
engaged in the transportation of person by motor vehicle for
compensation, whether in common or contract carriage, over any
public highway in the state. (Public Utilities Code Section
5360)
3)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. (Public Utilities Code
Section 5431)
FISCAL EFFECT: Unknown.
COMMENTS:
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.
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2)CPUC Transportation Consumer Complaint Unit: The CPUC's
Transportation Consumer Complaint Unit (Complaint Unit) is
tasked with resolving consumer complaints regarding
transportation service, costs, fraud and other issues. The
Complaint Unit has an individual 800 number to receive
complaints regarding passenger carriers and a second 800
number for complaints regarding moving companies. If the
Complaint Unit receives a complaint regarding an unlicensed
carrier, the complaint is referred to the Transportation
Enforcement Unit for investigation.
According to the CPUC, in 2015 it received 489 complaints
related to moving companies and passenger carriers. The CPUC
requires moving companies to provide consumers with a guide
which includes the Transportation Consumer Complaint 800
numbers. The CPUC also requires TNCs to provide the 800
number regarding passenger carriers to its consumers.
This bill requires the CPUC to establish a telephone
communications service that is available to members of the
public to communicate to the CPUC any concerns, or register
complaints, regarding service provided by CPCs, including
TNCs, as specified.
3)Licensing and Regulatory Number: Until recently, the CPUC
also maintained a phone line for carriers with questions
regarding the status of the license approval or guidance on
how to comply with regulatory requirements. Due to the high
volume of applications and request, as well as the lack of
staff resources, the CPUC closed the carrier phone line and
instructed carriers to visit the CPUC Web site for FAQs, or
email their question to a designed inbox. It is unclear if a
dedicated phone line is still the best option for carriers and
consumers to adequately request and receive information. It
is also unclear if the CPUC has the necessary staff to resolve
consumer complaints in a timely manner.
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This bill requires the CPUC to maintain all records and
resolve, or investigate, all complaints related to CPCs and
TNCs, as specified.
4)2014 State Auditor Report: In June 2014, the California State
Auditor release a report examining the CPUC's Transportation
Enforcement Branch, within the Safety and Enforcement
Division, effort to regulate passenger carriers, as well as
its use of fees collected from carriers. The report found
that the branch did not provide sufficient oversight of CPCs
and Passenger Stage Corporations to ensure consumer safety and
issued a series or recommendation to address the issues.
5)Arguments in Support: According to the Greater California
Livery Association, "California citizens and visitors
utilizing the service of the State of California sanctioned
and regulated transportation services should have the
opportunity to share concerns, comments, and complaints
regarding the drivers and/or vehicles providing those
transportation services; and be comforted to know that those
concerns, comments and complaints are being addressed ?
Assembly Bill 2603 will aid the CPUC in the licensing,
regulation and enforcement of regulations pertinent to the
charter-party carrier industry."
6)Prior Legislation:
SB 541 (Hill), Chapter 718, Statute of 2015: Codifies the
State Auditor report's recommendation on strengthening the
CPUC's oversight of transportation related activities.
REGISTERED SUPPORT / OPPOSITION:
AB 2603
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Support
Greater California Livery Association
Opposition
None on file.
Analysis Prepared by:Edmond Cheung / U. & C. / (916) 319-2083