BILL ANALYSIS Ó
SENATE COMMITTEE ON TRANSPORTATION AND HOUSING
Senator Jim Beall, Chair
2015 - 2016 Regular
Bill No: AB 2763 Hearing Date: 6/21/2016
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|Author: |Gatto |
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|Version: |4/18/2016 |
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|Urgency: |No |Fiscal: |No |
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|Consultant|Randy Chinn |
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SUBJECT: Transportation network companies: personal vehicles
DIGEST: This bill defines "personal vehicle" in the context of
Transportation Network Companies (TNCs).
ANALYSIS:
Existing law:
1)Defines a "transportation network company" to mean an
organization that provides prearranged transportation services
for compensation using an online-enabled application or
platform to connect passengers with drivers using a personal
vehicle (e.g., Lyft and Uber).
2)Defines a "participating driver" or "driver" as any person who
uses a vehicle in connection with a TNC's online-enabled
application or platform to connect passengers.
3)Authorizes the California Public Utilities Commission (CPUC)
to regulate TNCs.
4)Requires a TNC and any participating driver to maintain
specified insurance coverage, and specifies when the insurance
is in effect.
This bill defines "personal vehicle" as a vehicle used by a
participating driver to provide prearranged transportation
services for compensation, that is owned, leased, rented, or
AB 2763 (Gatto) Page 2 of ?
otherwise authorized for use for any period of time by the
participating driver; meets all inspection and other safety
requirements imposed by the CPUC; and is not a taxicab or
limousine.
COMMENTS:
1)Purpose. The author believes that this bill is needed to
determine the ownership, lease, and rental terms under which a
car may be driven by a TNC driver. This bill will ensure that
short-term auto rentals or leases provide all individuals who
have an interest in providing TNC services, especially those
of low income, the opportunity to do so.
In developing its regulations, the CPUC has relied on state
law, which uses the term "personal vehicle." While the
definition may seem so obvious as to not need its own
definition in the statutes, it is actually not clear. The
bill clarifies that a personal vehicle includes a car that is
leased or rented. On June 6, 2016, the CPUC asked parties for
comments on, among other things, defining personal vehicles.
That question was raised because the CPUC is considering
whether there should be a maximum or minimum period of the
rental or lease agreement to qualify a vehicle as personal and
therefore prohibit the vehicle from being used by a TNC
driver. The effect of this bill is to provide that definition
and moot the CPUC's question, thereby allowing the use of
leased or rented vehicles by TNC drivers irrespective of the
rental or lease duration.
2)Making it easy. Lyft and Uber have programs to help drivers
own, lease, or rent vehicles. Under these programs, the
rental/lease payment is deducted from the driver earnings.
Third-party companies have also been created which also
provide leases/rentals for potential Lyft and Uber drivers for
durations as short as an hour.
3)Curbing enthusiasm. Bill supporters enthuse that the bill
will make it easier for those of modest means to earn income
as TNC drivers by renting or leasing a car. The driver's
profitability will depend on how many rides they provide and
how much they make on each ride. This may well be a
win-win-win for the driver, lessor, and TNC, though a driver
AB 2763 (Gatto) Page 3 of ?
would be wise to note that he is committing to a fixed payment
while his income is variable; he doesn't control the price he
charges; competition from drivers is increasing; and he gets
paid only after his obligation to the lessor is fulfilled.
Caveat emptor.
Bill supporters also state that the bill will encourage the
use of more environmentally friendly and electric vehicles.
That's likely if the rented/leased vehicles are relatively
new, as newer vehicles are much cleaner and more efficient
than older vehicles. But while some of the leasing programs
are focused on hybrid and electric vehicles, there is no
requirement for those. And the environmental and congestion
effects of large numbers of vehicles circulating on streets
waiting for rides are unclear.
4)Double-referred. This bill has also been referred to the
Committee on Energy, Utilities and Communications.
Related Legislation:
AB 650 (Low) - deregulates the taxicab industry and transfers
the regulatory jurisdiction to the CPUC. This bill will be
heard by this committee on June 28.
AB 2293 (Bonilla, Chapter 389, Statutes of 2014) - requires
specified levels of insurance coverage for TNCs and their
drivers; established definitions of TNCs and participating
drivers.
Assembly Votes
Floor: 75-2
U&C: 14-0
FISCAL EFFECT: Appropriation: No Fiscal Com.: No Local:
No
POSITIONS: (Communicated to the committee before noon on
Wednesday,
June 15, 2016.)
SUPPORT:
California Chamber of Commerce
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Circulate San Diego
City of Beverly Hills
Climate Resolve
Electric Vehicle Charging Association
Enterprise Holdings
Evercar
Greenbelt Alliance
Internet Association
Lyft
Nrg
San Diego Regional Chamber of Commerce
Silicon Valley Leadership Group
Spur
Planning and Conservation League
TechNet
TransForm
Uber
Volta
OPPOSITION:
San Francisco Taxi Workers Alliance
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