BILL ANALYSIS Ó SB 697 Page 1 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: SB 697 Page 2 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) SB 697 Page 3 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 SB 697 Page 4 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 SB 697 Page 5 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 SB 697 Page 6 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 ontheits rail safety activitiesof 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. SB 697 Page 7 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 itswork planworkplan 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 ontheits 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. SB 697 Page 8 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. SB 697 Page 9 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. SB 697 Page 10 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 SB 697 Page 11 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 SB 697 Page 12