BILL ANALYSIS Ó
SENATE COMMITTEE ON TRANSPORTATION AND HOUSING
Senator Jim Beall, Chair
2015 - 2016 Regular
Bill No: SB 812 Hearing Date: 4/5/2016
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|Author: |Hill |
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|Version: |3/17/2016 |
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|Urgency: |No |Fiscal: |Yes |
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|Consultant|Randy Chinn, Sarah Carvill |
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SUBJECT: Charter-party carriers of passengers and passenger
stage corporations
DIGEST: This bill makes multiple changes to the California
Highway Patrol's (CHP) authority to inspect tour buses, with the
goal of increasing regulatory scrutiny of operators with poor
safety records. The bill also increases state oversight of
recalled limousines and buses.
ANALYSIS:
Existing law requires that charter-party carriers of passengers
obtain a permit from the California Public Utilities Commission
(CPUC) and register all individual buses with the CPUC. Charter
party carriers are also required to conduct safety inspections
on each of their buses at least every 45 days, to correct any
defects that are found during an inspection before transporting
passengers, and to keep detailed records of inspections and
repairs performed.
The CHP is required to conduct annual but unscheduled terminal
inspections on a representative subset of each carrier's buses
and records to verify that buses are being maintained in
accordance with the law, and to collect a fee of $15 per bus
(not to exceed $6,500 total) to offset the cost of inspection.
These fees are deposited in the state Motor Vehicle Account.
For companies with fewer than 100 buses, inspections are
scheduled.
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Passenger stage corporations are subject to the same
requirements as charter-party carriers with respect to reporting
their individual vehicles to the CPUC, inspecting their own
buses, correcting defects, and maintaining records of
maintenance and inspection. They are not required to pay a
per-bus fee for terminal inspections.
Existing law also provides that if a terminal receives an
"unsatisfactory" rating in an inspection, it must be inspected
again within 120 days. When the CHP finds violations at a
terminal of either a charter-party carrier or a passenger stage
corporation that constitute either an imminent threat to public
safety or evidence of consistent failure to comply with relevant
regulations, it is authorized to make a recommendation that the
CPUC suspend the carrier's operating authority. The CPUC is
required to follow the CHP's recommendation, but must first hold
a hearing on the matter.
This bill:
1) Imposes new requirements on the CPUC, passenger stage
corporations, and charter-party carriers with respect to
National Highway Traffic Safety Administration (NHTSA)
recalls in cases where the defect that prompted the recall
threatens the safe operation of a bus, limousine, or
modified limousine. Specifically, the bill:
a) Requires the CPUC to monitor NHTSA recalls and notify
operators with affected vehicles of certain safety
recalls;
b) Forbids operators from transporting passengers in
vehicles subject to certain safety recalls until the
defect that prompted the recall has been corrected; and
c) Gives the CPUC the authority to order out of service
any vehicle operated by a passenger stage corporation or a
charter-party carrier that is subject to certain safety
recalls.
1) Modifies the CHP's existing terminal inspection program so
that terminals with a history of unsatisfactory ratings are
inspected more frequently than terminals with a record of
satisfactory performance. Specifically, the bill:
a) Allows the CHP to inspect terminals with two or more
consecutive satisfactory ratings every 26 months as
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opposed to every 13 months;
b) Requires the CHP to inspect terminals that receive an
unsatisfactory rating every six months until the operator
achieves a satisfactory rating; and
c) When a terminal receives an unsatisfactory rating in a
regular inspection, requires the CHP to conduct a
follow-up inspection within 30 days.
1) Augments the existing terminal inspection program by
requiring the CHP to conduct additional surprise
inspections. The CHP is directed to prioritize companies
that have a history of noncompliance for these inspections,
and to ensure that at least 10% of the inspections it
conducts each year are surprise inspections.
2) Requires any operator that acquires a bus to have the
vehicle inspected by the CHP before it is used to transport
passengers, unless the bus is less than two years old.
3) Requires the CHP to order a bus out of service if it
finds, either during a terminal inspection or at some other
time, multiple safety violations that could constitute an
imminent threat to the public.
4) Effective January 1, 2018, requires passenger stage
corporations and charter party carriers to show proof of
their most recent bus terminal inspection to the Department
of Motor Vehicles (DMV) when renewing the registration of
any individual bus, and prohibits the DMV from registering a
bus if the operator has not attained a satisfactory rating.
5) Requires the CHP to establish by January 1, 2018, a new
scaled fee structure for terminal inspections that retains
the current maximum per-operator inspection fee.
6) Requires the CHP, in consultation with the CPUC and the
Office of the Legislative Counsel, to conduct a study of
existing statutes and regulations governing tour buses with
the goal of identifying opportunities to avoid duplication
and use terminology consistently. The CHP would be required
to report to the Legislature on its findings on or before
January 1, 2018.
COMMENTS:
1) Purpose. According to the author, "SB 812 puts forward
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common sense policies to improve the safety of tour buses
driven in California. Since 1986, the CHP has had a program
in place to inspect the safety of tour buses in the state.
Since the inception of the program the CHP has inspected
thousands of buses and caught many mechanical problems.
There are components of the inspection program, however,
that need to be updated and strengthened, which SB 812 seeks
to do. The bill will increase the number of surprise,
un-announced tour bus inspections, will shorten the amount
of time a bus operator has to fix safety problems, and will
implement a risk-based inspection methodology so tour bus
operators with a history of unsatisfactory ratings will be
inspected more often, meaning the CHP will focus more of
their efforts and limited resources on problematic and
unsafe bus operators. Lastly, SB 812 increases state
oversight of recalled limousines and buses."
2) What's covered. This bill deals with bus transportation
by charter-party carriers and passenger stage corporations.
It does not affect school buses or public transit buses. A
bus is defined as a vehicle designed to carry more than 10
people, including the driver. Charter party carriers
transport passengers traveling under a single contract for a
fixed fee, while passenger stage corporations transport
passengers over a fixed route between regular termini.
3) Background: San Francisco tour bus accident. On November
13, 2015, 19 people were injured when a City Sightseeing bus
crashed into construction scaffolding in San Francisco's
Union Square. The bus was originally a transit vehicle and
had been retrofitted as a double-decker open-air tour bus
before it was sold to City Sightseeing. Despite early
speculation that the vehicle's brakes may have failed, on
March 23, 2016, the CHP announced that the cause of the
crash was driver error. Post-crash investigations revealed
that City Sightseeing had not notified the CPUC when it
added the bus to its fleet, as required by law, and the CHP
identified other safety violations at the company in a
December 2015 terminal inspection.
4) Related legislation: AB 1574. The San Francisco bus
crash has drawn attention to the problem of unregistered
"ghost buses" and to the possibility of improving the CHP's
bus inspection program. The former issue is the target of
AB 1574 (Chiu), a companion bill which compels the CPUC and
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the DMV to ensure that the former has a record of all
commercial buses registered with the latter. AB 1574
imposes additional triggers for bus inspections and broadens
the authority of the CHP and the CPUC to impound vehicles.
5) NHTSA recalls. The provisions of this bill concerning
recalls were included in response to a fire in a modified
limousine that killed five passengers on the San Mateo
Bridge in 2013. The maker of that vehicle later recalled
nearly 1,000 limousines for the defect implicated in the
fire, but the recall went unnoticed by state regulators
until a California newspaper discovered it. The author of
this bill is concerned that buses and limousines under
safety recalls may continue to be used to transport
passengers even if the defects that prompted the recall have
not been fixed. Representatives of the bus industry point
out that many "safety" recalls arise from defects that do
not present an imminent threat to the operation of the
vehicle, so the bill provides the CPUC with discretion to
determine whether or not a particular recall warrants an out
of service order.
6) Terminal inspections: What they do and what they don't do.
Buses must undergo frequent maintenance, which is why
existing law requires operators to perform their own safety
checks and routine repairs on every vehicle at least once
every 45 days - far more often than regulators could be
called in for inspections. There are also tradeoffs between
the number of buses that are checked in an inspection and
the amount of notice given to operators, on the one hand,
and the impact to an operator's service on the other. While
the ideal inspection program might involve surprise terminal
visits in which all buses are physically examined, this
approach would severely compromise an operator's ability to
deliver reliable service to paying customers. The current
terminal inspection program balances these tradeoffs by
checking a subset of vehicles and examining terminal records
to determine whether operators have established systems that
ensure that all of their vehicles are safely maintained.
One assumption underlying this approach is that it would be
extraordinarily difficult for operators to persuasively
"fake" correspondence between maintenance records and actual
under-the-hood conditions.
7) New fee structure. The existing terminal inspection fee of
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$15/bus does not begin to cover the cost of inspections.
Depending on their operating authority, some bus companies
may not pay inspection fees at all. While matching fees to
the true cost of inspections could have a significant impact
on operators, raising the fees somewhat would at least
relieve the impact on the Motor Vehicle Account. This bill
requires the CHP to develop a new fee structure by
regulation, taking into account the costs to the state to
operate the program and preserving the $6,500 per terminal
cap in existing law.
8) The case for a performance-based system. This bill aims
to change the terminal inspection program so that it
prioritizes for inspection operators with a record of
safety-related violations. Some of the bus companies that
have been involved in accidents in California were out of
compliance with state safety regulations, and these
violations were either not detected prior to the accident or
were not corrected after detection. For example, City
Sightseeing had a record of satisfactory ratings on terminal
inspections prior to the November 2015 accident, but in a
surprise inspection following the crash, the CHP found
multiple serious violations in the terminal. A 2013 bus
crash near Pala, California, involved a company that had
received multiple "unsatisfactory" ratings in terminal
inspections in the three years leading up to the crash.
These examples suggest that some of the measures in this
bill, such as more frequent checks of poorly performing
operators, would increase the safety of bus travel.
9) Does the magnitude of the changes match the magnitude of
the problem? It is important to bear in mind, however, that
bus crashes are actually quite rare. In the year 2013, for
example, only 43 of 32,719 U.S. traffic fatalities (0.13%)
occurred in accidents involving a tour bus. In California,
only 6.5% of traffic fatalities and serious injuries occur
in accidents involving commercial vehicles - a category that
includes trucks as well as several different types of buses.
When bus accidents do occur, mechanical failures or defects
are usually not the cause. It is also worth noting that the
CHP's terminal inspection program is more comprehensive than
its counterparts in other states, and the existing program
includes performance-based elements. Specifically, if a
terminal inspection results in an unsatisfactory rating, the
CHP returns to that terminal within four months (120 days)
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for a follow-up inspection. Inspections continue on this
four-month interval until the operator receives a
satisfactory rating. With respect to terminals that receive
an unsatisfactory rating in an annual inspection, this bill
effectively replaces inspections every four months until
compliance is achieved with inspections every one month
until compliance is achieved, followed by inspections every
six months.
10) Alternative to inspection: loss of operating authority.
One of the primary ways this bill aims to make bus travel
safer is by requiring the CHP to conduct more vehicle and
terminal inspections than are required under existing law.
Several provisions of the bill either increase the number of
inspections that would be conducted under the CHP's existing
authority or require inspections to be conducted in
circumstances that do not trigger an inspection under
current law. These added inspections increase the cost of
the inspection program to the state. Revoking operating
authority from chronically noncompliant carriers is another
way to protect public safety that does not necessitate
imposing additional inspections. The author and committee
may wish to consider amendments that require the CHP to
recommend suspending an operator's license after it receives
three consecutive unsatisfactory ratings on terminal
inspections. These amendments would specify that an
operator would be considered to have received three
consecutive unsatisfactory ratings if it received (1) an
unsatisfactory compliance rating in a regular terminal
inspection and the next two consecutive follow-up terminal
inspections, or (2) an unsatisfactory compliance rating for
three consecutive regular terminal inspections, irrespective
of receiving satisfactory ratings on the follow-up
inspections associated with the first two terminal
inspections.
11) Inspections of newly acquired buses. Among the many
provisions in this bill relating to inspections, the
requirement that the CHP inspect all newly acquired buses
that are more than two years old is notable in that it
applies to all operators, not just those with a record of
poor performance. It is therefore less consistent with the
author's goal of instituting a more performance-based
inspection program than many of the bill's other
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requirements. This provision is also unique in that it
would require the CHP to send inspectors to terminals for
the purpose of examining a single vehicle - a less efficient
use of state resources than terminal inspections in which
multiple vehicles are inspected. The author and committee
may wish to consider amending the bill to limit this
provision to operators who have received an unsatisfactory
rating in their most recent terminal inspection.
12) Showing proof of successful terminal inspection to renew
DMV registration. The provisions in this bill requiring
operators to show proof of a recent terminal inspection to
the DMV in order to renew the registration of their buses
would not prevent an operator from renewing the registration
of an individual bus that has not been properly registered
with the CPUC. This requirement only provides an additional
incentive to operators to obtain a satisfactory rating on
their terminal inspections. An operator will only be
subject to this incentive in cases where the registration
renewal deadline for one of its vehicles coincides with the
interval between a failed terminal inspection and a
successful follow-up inspection. Both this bill and
existing law provide several more direct and consistent
penalties for operators who cannot obtain a satisfactory
rating on a terminal inspection. The author and committee
may wish to consider amending the bill to remove this
provision by striking Section 9 (page 12, lines 20-29).
13) Two years between inspections for good performers? This
bill attempts to offset the expansion of inspections for
poor performers by providing relief from annual inspections
to good performers. Instead, terminal inspections would be
required once every 26 months for operators who receive two
consecutive satisfactory ratings on terminal inspections.
This provision is not without precedent: Until recently, the
CHP permitted property carriers with strong compliance
records to bypass some annual inspections by certifying
their continued compliance with state safety requirements.
However, this relaxed inspection option was not extended to
carriers of hazardous materials, suggesting that the state
found it important to maintain annual inspections for
higher-risk cargo. Loosening the annual inspection
requirement for carriers who are responsible for the safety
of human passengers may be out of step with this practice.
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14) Two kinds of bus operators, two sets of rules. Currently,
the statutory requirements facing charter-party carriers and
passenger stage corporations are enumerated in different
sections of the Public Utilities Code. In many cases they
are similar or even identical, but sometimes they are
markedly different. A good example is the fee for terminal
inspections, which is fixed in statute for charter-party
carriers but not for passenger stage corporations.
Terminology related to vehicles (e.g., buses, tour buses)
also varies among code sections and codes. The study of
statutes and regulations required by this bill would
evaluate whether the complexity of state policy in this area
has resulted in uneven public safety requirements or
arbitrary distribution of costs among operator types.
Related Legislation:
AB 1574 (Chiu) - imposes new requirements on the CPUC and the
DMV with the goal of ensuring that all commercial buses,
limousines, and modified limousines are registered with the CPUC
and broadens the authority of the CHP and the CPUC in cases
where such vehicles are not properly registered. This bill is
pending in the Assembly Utilities and Commerce Committee.
FISCAL EFFECT: Appropriation: No Fiscal Com.: Yes
Local: Yes
POSITIONS: (Communicated to the committee before noon on
Wednesday,
March 30, 2016.)
SUPPORT:
California Bus Association
OPPOSITION:
None received
-- END --
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