BILL ANALYSIS                                                                                                                                                                                                    Ó



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          Date of Hearing:  July 6, 2015


                    ASSEMBLY COMMITTEE ON UTILITIES AND COMMERCE


                                Anthony Rendon, Chair


          SB  
          697 (Hertzberg) - As Amended June 24, 2015


          SENATE VOTE:  Vote not relevant


          SUBJECT:  Public Utilities Commission:  reports: civil  
          penalties:  charter-party carriers of passengers.


          SUMMARY:  This bill repeals the California Public Utilities  
          Commission's (CPUC) requirement to issue a decal to  
          charter-party carriers (CPC) and makes technical changes to the  
          Public Utilities Code relating to reporting requirements.   
          Specifically, this bill: 


          1)Repeals the CPUC's requirement to issue a suitable decal for  
            each vehicle registered with the CPUC and operated by a CPC,  
            holding a valid permit or certificate of public convenience  
            and necessity, for motor vehicles designed to carry no more  
            than eight passengers, including the driver. 


          2)Consolidates and makes technical changes to the Public  
            Utilities Code relating to reporting requirements. 


          EXISTING LAW:   








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          1)Defines "charter-party carrier of passenger" as every person  
            engaged in the transportation of persons by motor vehicle for  
            compensation, whether in common or contract carriage, over any  
            public highway in the state.  (Public Utilities Code Section  
            5360)


          2)Prohibits a CPC, as specified, from engaging in transportation  
            services without obtaining a certificate or permit from the  
            CPUC.  (Public Utilities Code Section 5371)


          3)Requires the CPUC to establish that the person or corporation  
            is financially and organizationally capable to conduct  
            transportation services, including complying with all  
            applicable laws and regulations, before a permit or  
            certificate is issued or renewed.  (Public Utilities Code  
            Section 5374)


          4)Authorizes the CPUC to investigate complaints against carriers  
            and cancel, revoke, or suspend permits and certificates for  
            specific violations.  (Public Utilities Code Section 5387)


          5)Requires a CPC to display a distinctive identifying symbol, on  
            the vehicle, prescribed by the CPUC showing the classification  
            to which the carrier belongs.  (Public Utilities Code Section  
            5385)


          6)Requires the CPUC to issue a suitable decal for each vehicle,  
            as specified, registered with the CPUC and operated by a CPUC  
            holding a valid permit or certificate.  The decal shall be a  
            minimum size of two and one-half inches by six inches, and  
            shall be affixed to the lower right hand corner of the rear  
            bumper of the vehicle.  (Public Utilities Code Section 5385.5)  








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          FISCAL EFFECT:  According to the Senate Appropriations Committee  
          on the prior version of this bill, this bill would have  
          potential future savings of up to $75,000 to the Public  
          Utilities Commission Transportation Reimbursement Account for  
          reduced workload associated with issuing decals.


          COMMENTS:  


           1)Author's Statement:   "[This bill] eliminates antiquated CPUC  
            decal requirements; SB 697 makes California law clearer and  
            easier to abide by for limousine and other passenger carriers  
            and for law enforcement to uphold.  [In addition, this bill]  
            consolidates and clarifies the CPUC's statutory reporting  
            requirements; SB 697 makes California law clearer and easier  
            to understand and track all CPUC reports."


           2)Background:   California law regulates different modes of  
            passenger transportation for compensation, including taxi  
            services, which are regulated by cities and/or counties, as  
            well as CPCs and Passenger Stage Corporations, which are  
            regulated by the CPUC.  CPCs are services that charter a  
            vehicle, on a prearranged basis, for the exclusive use of an  
            individual or group.  Charges are based on the mileage or time  
            of use, or a combination of both.  The CPUC does not regulate  
            the level of charges for CPCs.  Types of CPCs include limos,  
            tour buses, sightseeing services, and charter and party buses.  
             


            The CPUC requires CPCs to meet a number of requirements until  
            an operating permit or certificate is issued.  These  
            requirements include providing sufficient proof of financial  
            responsibility, maintain a preventative maintenance program  








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            for all vehicles, possessing a safety education and training  
            program, and regularly checking the driving records of all  
            persons operating vehicles used in transportation for  
            compensation.  Taxis are excluded from the definition of CPCs  
            and are regulated by cities or counties.


           3)CPC Permits:   The CPUC authorizes six types of Transportation  
            Charter Party (TCP) certificates and permits for CPCs:

                 Three types of transferable certificates:  Class A  
               certificates allows charter service between any point in  
               the state, such as roundtrip sightseeing service; Class B  
               certificates allows charter service between any point  
               within 125 miles of the carrier's home terminal; and Class  
               C certificates transportation services that apply to  
               commercial balloon operations, and commercial river rafting  
               or skiing.

                 Three types of nontransferable permits: P permits allow  
               charter services using only vehicles that seat under 15  
               passengers, S permits allow charter services to provide  
               round-trip sightseeing services, and Z permits which  
               authorizes specialized services not offered to the general  
               public; namely, transportation incidental to another  
               business, transportation under contact with specific  
               entities, and transportation of agricultural works to and  
               from farms. 

           1)Senate Bill 611:   In 2014, in response to fatal limousine  
            fires, the Legislature passed SB 611 (Hill, Chapter 860,  
            Statues of 2014) requiring all modified limousines to be  
            equipped with fire extinguishers and requiring the California  
            Highway Patrol to develop and implement an inspection program  
            for modified limousines.  The bill also repealed a provision  
            that required CPCs to obtain special "livery" license plates  
            issued by the Department of Motor Vehicles. 

           2)Decal vs. Identifying Symbol:   Current law requires the CPUC  








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            to issue a suitable decal for CPCs.  Before the passage of SB  
            611, CPCs were allowed to obtain special license plates in  
            lieu of being issued and displaying the decal.  With the  
            passage of SB 611, the requirement was reverted back to  
            issuing decals.  Hence, current law now requires the CPCs to  
            display a decal, as well as a distinctive identifying symbol  
            issued by the CPUC.  When livery plates were eliminated under  
            SB 611, stakeholders thought that the distinctive identifying  
            symbol issued by the CPUC also satisfied the requirement to  
            display a decal.  For CPCs, this distinctive identifying  
            symbol includes the TCP identification number displayed along  
            the bumper of the motor vehicle.  Oversight of CPCs is based  
            upon the vehicles' TCP numbers.  The CPUC has not issued, nor  
            has it produced, any decals in over two decades.  In the  
            meantime, the CPUC has issued "Temporary Acknowledgment of  
            Vehicle Added letters" which are to be kept in the permitted  
            vehicle at all times, depending on if or when a decal is  
            produced and issued. 



            Due to the conflicting nature of the statues, this bill would  
            repeal the CPUC requirement to issue a suitable decal for CPC  
            vehicles, hence, leaving only the requirement that CPCs must  
            display a CPUC-issued distinctive identifying symbol.





           3)Consolidating Reporting Requirements in the Public Utilities  
            Code:   This bill also makes technical changes to the Public  
            Utilities Code by consolidating and clarifying statutory  
            reporting requirements under one section of the Public  
            Utilities Code.  The CPUC is required by statute to prepare  
            and publish numerous reports on a wide range of subjects  
            within its jurisdiction.  The reporting requirements are  
            typically codified in separate sections within the Public  
            Utilities Code.  Consolidating the reporting requirements in a  








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            single area of the code will assist tracking and compliance.   
            A provision in this bill changes Public Utilities Code Section  
            321.6 which is also currently being amended by Senate Bill 48  
            (Hill).  This provision relates to the CPUC's requirement to  
            submit an annual plan to the Governor and Legislature with an  
            annual work plan on schedule ratemaking proceedings and other  
            decisions considered by the CPUC, a complete accounting of the  
            CPUC's transactions and proceedings for the preceding year,  
            and a report on the number of cases where resolutions exceeded  
            the time period prescribed in scoping memos and the days that  
            commissioners presided in hearings.  This bill will require  
            double jointing language with SB 48 to resolve the conflict. 



            The current version of SB 697 represents a partial  
            consolidation of the CPUC's reports.

             The author may wish to also include the following additional  
            Public Utilities Code reporting requirements into the bill:

              1.   Change the new Public Utilities Code Section 916 to  
               Public Utilities Code Section 916.2. Additionally, change  
               the code section to add a new subdivision (d) to read as  
               follows:  "(d) The commission may combine the information  
               required by this section with the report prepared pursuant  
               to Section 916." 
              2.   Change the new Public Utilities Code Section 911 to  
               Public Utilities Code Section 916. Additionally, change the  
               code section's first sentence to read as follows: "On or  
               before November 30 of each year, the commission shall  
               report to the Legislature on  the   its rail safety  activities   
               of the division of the commission responsible for consumer  
               protection and safety, and shall fully document in the  
               report all expenditures of those funds in the audit report  
               provided in subdivision (f) of Section 421  ."
             3.   Change all of the code sections that were changed to  
               refer to the new Section 916 (previously Section 7711) to  
               now refer to 916.2.








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             4.   Strike the amended subdivision (d) of Public Utilities  
               Code Section 7661 and move it to a new Public Utilities  
               Code Section 916.1. Change the "subdivision (b)" reference  
               to "subdivision (b) of Section 7661."
             5.   Change the new Public Utilities Code Section 911.1 to  
               Public Utilities Code Section 911. Additionally, change  
               subdivision (b) to read as follows: "(b) The commission  
               shall include in its  work plan   workplan  required pursuant  
               to Section 910, a summary of the staff safety  
               investigations concluded during the prior calendar year and  
               the staff safety investigations that remain open for any  
               gas corporation or electrical corporation, with a link to  
               the Internet Web site with the report that contains the  
               information required pursuant to subdivision (a)."
             6.   Change the new Public Utilities Code Section 910.1 to  
               Public Utilities Code Section 910.2.
             7.   Change existing Public Utilities Code Section 765.6 to  
               Public Utilities Code Section 916.3. Additionally, amend  
               the language of the code section to read as follows: "  (a)  
                The commission shall  annually  report to the Legislature  on  
               or before November 30 of each year  on  the   its  compliance  
               with the requirements of Section 765.5  , as added by Chapter  
               763 of the Statutes of 1991, on or before January 1, 1993,  
               and annually thereafter. Commencing in 1996, the report  
               shall be submitted on or before November 30 of each year  .  
               The annual report shall include a determination by the  
               commission of the impact on competition, if any, of the  
               regulatory fees assessed railroad corporations and motor  
               carriers for the support of the commission's activities.  
                (b) The commission may combine the information required by  
               this section with the report prepared pursuant to Section  
               916.  "
             8.   Change the new Public Utilities Code Section 912 to  
               Public Utilities Code Section 912.1.
             9.   Change existing Public Utilities Code Section 432.5 to  
               Public Utilities Code Section 910.3.
             10.  Strike subdivision (e) of Public Utilities Code Section  
               8283. Put the subdivision (e) language into a new Public  
               Utilities Code Section 910.4.








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             11.  Change existing Public Utilities Code Section 326.5 to  
               Public Utilities Code Section 910.5.
             12.  Change existing Public Utilities Code Section 326 to  
               Public Utilities Code Section 910.6.
             13.  Strike subdivision (c) of Public Utilities Code Section  
               311.4.
             14.  Add a new Public Utilities Code Section 910.7 that reads  
               as follows: "It is the intent of the Legislature that,  
               commencing one year from the date that the procedures  
               described in subdivision (a) of Section 311.4 are  
               implemented, the commission annually review the procedures  
               and the technology involved to ensure the continued  
               effectiveness of the program, and report any findings to  
               the Legislature."
             15.  Change new Public Utilities Code Section 914 to Public  
               Utilities Code Section 914.6.
             16.  Strike subdivision (b) of existing Public Utilities Code  
               Section 7912 and move it to a new Public Utilities Code  
               Section 914. Change "public utilities pursuant to  
               subdivision (a)" to instead read "telephone corporations  
               pursuant to Section 7912."
             17.  Change existing Public Utilities Code Section 873 (a)(2)  
               to a new Public Utilities Code Section 914.1.
             18.  Change the last sentence of existing Public Utilities  
               Code Section 2891 (d)(10) to a new Public Utilities Code  
               Section 914.2. Instead of referencing "its annual  
               low-income ratepayer assistance report" instead reference  
               the new Public Utilities Code Section 914.1 report.
             19.  Change existing Public Utilities Code Section 5960 (c)  
               to a new Public Utilities Code Section 914.3. Modify 5960  
               (d) to only reference "submitted to" and modify new 914.3  
               to include the 5960 (d) language, but only reference  
               "reported by".
             20.  Change existing Public Utilities Code Section 5920 (b)  
               to a new Public Utilities Code Section 914.4.
             21.  Change existing Public Utilities Code Section 2881 (k),  
               (l), and (o) to a new Public Utilities Code Section 914.5.
             22.  Change existing Public Utilities Code Section 281 (j) to  
               a new Public Utilities Code Section 914.7.








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             23.  Change existing Public Utilities Code Section 281 (i) to  
               a new Public Utilities Code Section 912.2.
             24.  Strike the amended subdivision (d) of Public Utilities  
               Code Section 765 and move it to a new Public Utilities Code  
               Section 916.4. Change the Section 321.6 reference to  
               "Section 910."
             25.  Take the uncodified budget RPS quarterly report language  
               and put it in a new Public Utilities Code Section 913.5.
             26.  Change existing Public Utilities Code Section 399.19 to  
               Public Utilities Code Section 913.6. Amend the existing  
               reference in subdivision (d) to "this article" to clarify  
               that the article in question is Article 16 of Chapter 2.3  
               of Part 1 of Division 1 of the Public Utilities Code.
             27.  Change existing Public Utilities Code Section 384.2 to a  
               new Public Utilities Code Section 913.7.
             28.  Change existing Public Utilities Code Section 381.2 (b)  
               to a new Public Utilities Code Section 913.8.
             29.  Strike the amended Public Utilities Code Section 747.6  
               and move it to a new Public Utilities Code Section 913.9. 
             30.  Change existing Public Utilities Code Section 321.7 to a  
               new Public Utilities Code Section 913.10.
             31.  Change existing Public Utilities Code Section 8367 to a  
               new Public Utilities Code Section 913.11.
             32.  Change existing Public Utilities Code Section 740.3 (b)  
               to new Public Utilities Code Section 913.12.
             33.  Change existing Public Utilities Code Section 2851  
               (c)(3) to new Public Utilities Code Section 913.13.
             34.  Change existing Public Utilities Code Section 785 (b) to  
               a new Public Utilities Code Section 913.14.
             35.  Strike the amended subdivision (d) of Public Utilities  
               Code Section 960 and move it to a new Public Utilities Code  
               Section 913.15. Change the Section 321.6 reference to  
               "Section 910."
             36.  Strike the last two sentences of Public Utilities Code  
               Section 348 and put them in a new Public Utilities Code  
               Section 919.
             37.  Strike the last two sentences of Public Utilities Code  
               Section 364 (b) and put them in a new Public Utilities Code  
               Section 919.1.








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             38.  Strike Public Utilities Code Section 379.7 (f) and put  
               in a new Public Utilities Code Section 919.2. Sunset the  
               clause to conform with the dates in Public Utilities Code  
               Section 379.7 (g).


           1)Arguments in Support:   According to the CPUC, the sponsor of  
            the bill, "when last year's SB 611 (Hill) eliminated the  
            requirement that limousine operators obtain specialized  
            license plates as a condition for legal operation, it  
            inadvertently reactivated Public Utilities Code Section  
            5385.5, which requires limousine decals that the CPUC has not  
            issued since 1995.  SB 697 would clarify that decals need no  
            longer be issued, thus affirming the intent of SB 611 and the  
            consensus opinion of regulators that a TCP ID sticker alone  
            suffices as necessary identification for legal operation of a  
            limousine.  SB 697 would further help encourage accountability  
            at the CPUC by consolidating key [CPUC] reports into a single  
            section of code, thus allowing the Legislature to better  
            ensure that all reports are delivered on schedule."



           2)Prior Legislation:  


           


            SB 611 (Hill) 2014:  Requires all modified limousines, as  
            defined, to be equipped with two fire extinguishers and  
            requires the California Highway Patrol to develop and  
            implement an inspection program for modified limousines, as  
            specified.  Chaptered by Secretary of State - Chapter 860,  
            Statutes of 2014. 


            AB 2227 (Bradford) 2012:  Recasts and revises reporting  
            requirements applicable to publicly owned utilities and  








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            revises certain reporting requirements.  Chaptered by  
            Secretary of State - Chapter 606, Statutes of 2012.


          REGISTERED SUPPORT / OPPOSITION:




          Support


          California Public Utilities Commission (Sponsor)


          Greater California Livery Association




          Opposition


          None on file.




          Analysis Prepared by:Edmond Cheung / U. & C. / (916)  
          319-2083

















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