BILL ANALYSIS Ó
AB 2777
Page 1
Date of Hearing: April 21, 2016
ASSEMBLY COMMITTEE ON UTILITIES AND COMMERCE
Mike Gatto, Chair
AB 2777
(Nazarian) - As Amended April 14, 2016
SUBJECT: Transportation network company: criminal history
SUMMARY: Requires the Department of Justice (DOJ), upon request
of a Transportation Network Company (TNC), to provide a TNC with
the criminal history and arrest information of its employees and
contractors. Specifically, this bill:
1)Requires the DOJ, at the request of a TNC, for an individual who
is employed, retained, contracted, or otherwise compensated to
perform services coordinated by the TNC either of the following:
a) State summary criminal history information, as specified;
or
b) Subsequent arrest notification services, as specified.
2)Requires the DOJ to charge the TNC a fee sufficient to cover the
cost of processing a request.
EXISTING LAW:
AB 2777
Page 2
1)Establishes the "Passenger Charter-Party Carriers Act," which
directs the California Public Utilities Codes (CPUC) to issue
permits or certificates to Charter Party Carriers (CPCs),
investigate complaints against carriers, and cancel, revoke, or
suspend permits and certificates for specific violations.
(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)
4)Requires the DOJ to furnish state summary criminal history
information to specified entities, if needed in the course of
their duties and, when specifically authorized, federal-level
criminal history information, upon showing of a compelling need,
provided that when information is furnished to assist an agency,
officer, or official of state or local government, a public
utility, or any other entity in fulfilling employment,
certification, or licensing duties, as specified. (Penal Code
Section 11105)
5)Authorizes the DOJ to charge the person or entity making the
request a fee that it determines to be sufficient to reimburse
the department for the cost of furnishing the information. In
addition, the DOJ may add a surcharge to the fee to fund
maintenance and improvements to the systems from which the
information is obtained. Notwithstanding any other law, any
person or entity required to pay a fee to the DOJ for
information received, as specified, may charge the applicant a
fee sufficient to reimburse the person or entity for this
expense. (Penal Code Section 11105).
AB 2777
Page 3
6)Authorizes the DOJ or any state or local law enforcement agency
to require the submission of fingerprints for the purpose of
conducting summary criminal history information checks that are
authorized by law. (Penal Code Section 11105)
7)Requires, notwithstanding any other law, whenever state summary
criminal history information is initially furnished, as
specified, the DOJ to disseminate the following information:
a) Every conviction rendered against the applicant.
b) Every arrest for an offense for which the applicant is
presently awaiting trial, whether the applicant is
incarcerated or has been released on bail or on his or her
own recognizance pending trial.
c) Every arrest for an offense for which the records of the
DOJ do not contain a disposition or did not result in a
conviction, provided that the DOJ first makes a genuine
effort to determine the disposition of the arrest. However,
information concerning an arrest shall not be disclosed if
the records of the DOJ indicate or if the genuine effort
reveals that the subject was exonerated, successfully
completed a diversion or deferred entry of judgment program,
or the arrest was deemed a detention.
d) Every date and agency name associated with all retained
peace officer or nonsworn law enforcement agency employee
preemployment criminal offender record information search
AB 2777
Page 4
requests.
e) Sex offender registration status of the applicant. (Penal
Code Section 11105)
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.
2)Criminal Background Checks: CPUC regulations require TNCs to
run criminal background checks on all hired drivers, but it does
not specify the parameters for which TNCs must go about doing
these background checks. As such, TNCs generally contract with
third party firms that they argue provide a more comprehensive
review necessary to ensure passenger safety. For example, Uber
argues that its background screening process checks primary
sources and court records going back seven years, in addition to
other national databases.
However, news reports continue to identify situations in which
AB 2777
Page 5
TNC drivers have been accused of criminal situations such as
rape, assault, kidnapping, among others. The CPUC currently has
a pending rulemaking process examining TNC regulations,
including whether or not to require fingerprints as part of the
TNC background checks.
3)RAP Sheet: The state summary criminal history information,
commonly referred to as the Record of Arrests and Prosecutions,
or "RAP sheet," is compiled by the DOJ and includes information
pertaining to the identification and criminal history of any
person, such as name, date of birth, physical description,
fingerprints, photographs, arrests, dispositions, and similar
data. The disclosure of criminal history information is closely
guarded. Penal Code Section 13300 et. seq., demonstrates that
the Legislature intended nondisclosure of criminal offender
record information to be the general rule.
While some entities are able to receive the information in the
course of their duties, others can only obtain that information
if there is compelling need and subject to specific provisions
of the Labor Code, which regulates inquires by employers on
employee criminal backgrounds. Examples of entities that are
authorized to receive such information include banks, private
security, school contract employees. Absent a compelling need,
such information should be protected to ensure privacy and
prevent discrimination among employers and employees.
This bill requires the DOJ, at the request of a TNC, to provide
the TNC with the state summary criminal history information and
any subsequent arrest notification services of its employees or
contactors. This bill requires the DOJ to charge the TNC a fee
sufficient to cover the cost of processing a request.
Currently, TNCs are not required to provide the DOJ with
fingerprints of its employees or contractors. Hence, it is
unclear how the DOJ would comply with the request proposed under
this bill, as it would not have the necessary information of
each employee or contractor available to provide the TNC, if
requested.
AB 2777
Page 6
4)Arguments in Opposition: According to the Internet Association
and TechNet, "AB 2777 attempts to provide the statutory
authorization that would allow the [DOJ] to perform background
checks and arrest notifications of TNC drivers. As currently
drafted, this authorization is permissive - only at the request
of a TNC - but we are concerned that this could easily become an
unnecessary legislative mandate. In addition, this
authorization is premature as the [CPUC] has already stated
their intent to examine background checks in Phase III of their
TNC rulemaking process."
5)Double Referred: This bill was previously heard in the Assembly
Committee on Public Safety and passed out on a 7-0 vote.
REGISTERED SUPPORT / OPPOSITION:
Support
None on file.
Opposition
The Internet Association
Lyft
TechNet
AB 2777
Page 7
Uber Technologies, Inc.
Analysis Prepared by:Edmond Cheung / U. & C. / (916) 319-2083