BILL ANALYSIS                                                                                                                                                                                                    Ó



                                                                    AB 2820


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          ASSEMBLY THIRD READING


          AB  
          2820 (Chiu)


          As Amended  March 15, 2016


          Majority vote


           ------------------------------------------------------------------ 
          |Committee       |Votes|Ayes                  |Noes                |
          |                |     |                      |                    |
          |                |     |                      |                    |
          |                |     |                      |                    |
          |----------------+-----+----------------------+--------------------|
          |Public Safety   |7-0  |Jones-Sawyer,         |                    |
          |                |     |Melendez, Lackey,     |                    |
          |                |     |Lopez, Low, Quirk,    |                    |
          |                |     |Santiago              |                    |
          |                |     |                      |                    |
          |----------------+-----+----------------------+--------------------|
          |Appropriations  |19-1 |Gonzalez, Bigelow,    |Obernolte           |
          |                |     |Bloom, Bonilla,       |                    |
          |                |     |Bonta, Calderon,      |                    |
          |                |     |Chang, Daly, Eggman,  |                    |
          |                |     |Gallagher, Eduardo    |                    |
          |                |     |Garcia, McCarty,      |                    |
          |                |     |Holden, Jones, Quirk, |                    |
          |                |     |Santiago, Wagner,     |                    |
          |                |     |Weber, Wood           |                    |
          |                |     |                      |                    |
          |                |     |                      |                    |
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                                                                    AB 2820


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          SUMMARY:  Revises the definition of state of emergency and local  
          emergency for purposes of criminal price gouging.  Specifies  
          that criminal price gouging includes rental of any housing with  
          an initial lease of up to one year for purposes of criminal  
          price gouging.  Includes the transportation of persons and  
          towing services in the criminal price gouging during a declared  
          emergency.  Specifically, this bill:  
          1)Revises the definition of a state of emergency to mean a  
            natural or manmade disaster or emergency caused by conditions  
            such as, but not limited to, air pollution, earthquake, fire,  
            flood, storm, epidemic, riot, drought, sudden and severe  
            energy shortage, plant or animal infestation or disease, for  
            which a state of emergency has been declared by the President  
            of the United States or the Governor of California. 
          2)Revises the definition of a local emergency to mean a natural  
            or manmade disaster or emergency caused by conditions such as,  
            but not limited to, air pollution, earthquake, fire, flood,  
            storm, epidemic, riot, drought, sudden and severe energy  
            shortage, plant or animal infestation or disease, for which a  
            local emergency has been declared by an official, board, or  
            governing body vested with authority to make such a  
            declaration in any city, county, or city and county in  
            California.


          3)Applies the definitions above, throughout the criminal price  
            gouging statute.


          4)Includes the transportation of persons and towing services in  
            the crime of price gouging during a declared emergency.


          5)Specifies that criminal price gouging during a declared  
            emergency includes any rental housing with an initial lease  
            term of up to one year.


          EXISTING LAW:








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          1)Provides that upon the declaration of a state of emergency  
            resulting from an earthquake, flood, fire, riot, storm, or  
            natural or manmade disaster declared by the President of the  
            United States or the Governor, or upon the declaration of a  
            local emergency resulting from an earthquake, flood, fire,  
            riot, storm, or natural or manmade disaster by the executive  
            officer of any county, city, or city and county, and for a  
            period of 30 days following that declaration, it is unlawful  
            for a person, contractor, business, or other entity to sell or  
            offer to sell any consumer food items or goods, goods or  
            services used for emergency cleanup, emergency supplies,  
            medical supplies, home heating oil, building materials,  
            housing, transportation, freight, and storage services, or  
            gasoline or other motor fuels for a price of more than 10%  
            above the price charged by that person for those goods or  
            services immediately prior to the proclamation of emergency. 


          2)States that upon the declaration of a state of emergency  
            resulting from an earthquake, flood, fire, riot, or storm  
            declared by the President of the United States or the  
            Governor, or upon the declaration of a local emergency  
            resulting from an earthquake, flood, fire, riot, or storm by  
            the executive officer of any county, city, or city and county,  
            and for a period of 180 days following that declaration, it is  
            unlawful for a contractor to sell or offer to sell any repair  
            or reconstruction services or any services used in emergency  
            cleanup for a price of more than 10% above the price charged  
            by that person for those services immediately prior to the  
            proclamation of emergency. 


          3)Specifies that upon the proclamation of a state of emergency  
            resulting from an earthquake, flood, fire, riot, storm, or  
            other natural disaster declared by the President of the United  
            States or the Governor, or upon the declaration of a local  
            emergency resulting from an earthquake, flood, fire, riot,  








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            storm, or other natural disaster by the executive officer of  
            any county, city, or city and county, and for a period of 30  
            days following that proclamation or declaration, it is  
            unlawful for an owner or operator of a hotel or motel to  
            increase the hotel or motel's regular rates, as advertised  
            immediately prior to the proclamation or declaration of  
            emergency, by more than 10%.


          4)Specifies that, a greater price increase for the goods and  
            services, mentioned above, is not unlawful if that person can  
            prove that the increase in price was directly attributable to  
            additional costs imposed by specified circumstances. 


          5)Provides that time frame prohibiting specified price increases  
            may be extended for additional 30-day periods by a local  
            legislative body or the California Legislature, if deemed  
            necessary to protect the lives, property, or welfare of the  
            citizens. 


          6)States that the conduct described above is a misdemeanor  
            punishable by imprisonment in a county jail for a period not  
            exceeding one year, or by a fine of not more than $10,000, or  
            by both that fine and imprisonment. 


          7)Specifies that the conduct described above shall constitute an  
            unlawful business practice and an act of unfair competition. 


          8)Defines "State of emergency" as "a natural or manmade disaster  
            or emergency resulting from an earthquake, flood, fire, riot,  
            or storm for which a state of emergency has been declared by  
            the President of the United States or the Governor of  
            California."










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          9)Defines "Local emergency" as "a natural or manmade disaster or  
            emergency resulting from an earthquake, flood, fire, riot, or  
            storm for which a local emergency has been declared by the  
            executive officer or governing body of any city or county in  
            California."


          10)Defines "Housing" as "any rental housing leased on a  
            month-to-month term" for purposes of criminal price gouging. 


          11)States that except as specified, in all leases of lands from  
            week to week, month to month, or other period less than a  
            month, the landlord may, upon giving notice in writing to the  
            tenant, in the appropriate manner, change the terms of the  
            lease to take effect, as to tenancies for less than one month,  
            upon the expiration of a period at least as long as the term  
            of the hiring itself, and, as to tenancies from month to  
            month, to take effect at the expiration of not less than 30  
            days, but if that change takes effect within a rental term,  
            the rent accruing from the first day of the term to the date  
            of that change shall be computed at the rental rate obtained  
            immediately prior to that change. 


          12)Specifies that the notice, when served upon the tenant, shall  
            in and of itself operate and be effectual to create and  
            establish, as a part of the lease, the terms, rents, and  
            conditions specified in the notice, if the tenant shall  
            continue to hold the premises after the notice takes effect.


          13)States that all leases of a residential dwelling, or of any  
            interest therein, from week to week, month to month, or other  
            period less than a month, the landlord may increase the rent  
            provided in the lease or rental agreement, upon giving written  
            notice to the tenant, as follows, by either of the following  
            procedures:









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             a)   By delivering a copy to the tenant personally; or 
             b)   By serving a copy by mail under the procedures as  
               specified. 


          14)States that for an increase in rent greater than 10%, the  
            minimum notice period required pursuant to that paragraph  
            shall be increased by an additional 30 days, but does not  
            apply to an increase in rent caused by a change in a tenant's  
            income or family composition as determined by a  
            recertification required by statute or regulation. 
          FISCAL  
          EFFECT:  According to the Assembly Appropriations Committee, as  
          violation of the above is a misdemeanor, minor nonreimbursable  
          costs for incarceration, offset to a degree by fine revenue.


          COMMENTS:  According to the author, "Following the devastating Aliso  
          Canyon gas leak, unscrupulous individuals took advantage of a  
          tragic loophole in current law and raised the prices of housing  
          and services.  AB 2820 updates current law to ensure that  
          whether the disaster prompting the declaration of a state of  
          emergency is natural or manmade, familiar or totally  
          unprecedented, consumers across the state will be protected from  
          excessive price increases.  Disaster victims should not be  
          victimized twice."




          Analysis Prepared by:                                             
                          David Billingsley/ PUB. S. / (916) 319-3744  FN:  
          0002886













                                                                    AB 2820


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