BILL ANALYSIS Ó
SENATE COMMITTEE ON APPROPRIATIONS
Senator Ricardo Lara, Chair
2015 - 2016 Regular Session
SB 812 (Hill) - Charter-party carriers of passengers: passenger
stage corporations: private carriers of passengers
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|Version: April 27, 2016 |Policy Vote: T&H 10 - 0; E,U,& |
| | C 11 - 0 |
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|Urgency: No |Mandate: Yes |
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|Hearing Date: May 16, 2016 |Consultant: Mark McKenzie |
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This bill meets the criteria for referral to the Suspense File.
Bill
Summary: SB 812 would make changes to the bus terminal
inspection program and require the California Highway Patrol
(CHP) to perform additional unannounced inspections and follow
up inspections, as specified. The bill would also require the
California Public Utilities Commission (CPUC) to monitor recall
notifications relative to buses and limousines, notify operators
of recalls, and issue out-of-service orders for vehicles
requiring certain recall repairs.
Fiscal
Impact:
CHP costs:
Estimated CHP costs of up to $75,000 to develop and adopt
regulations to modify the tour bus inspection program and the
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fee schedule. (Motor Vehicle Account)
Estimated CHP staff costs off approximately $1 million to $1.4
million in the first year, and $500,000 to $700,000 annually
ongoing for 6-8 PY of new inspection staff. First year costs
include initial training and equipment costs for new staff.
(Motor Vehicle Account)
Unknown, significant revenue gains as a result of the
requirement that CHP adopt a fee schedule that covers its
costs to administer the inspection program. Increased fee
revenues would fully offset the increased staffing costs noted
above, and correct structural deficits in the current program.
(Motor Vehicle Account)
CPUC costs:
One-time CPUC costs of approximately $100,000 to make
necessary automation upgrades. (Transportation Reimbursement
Account)
Ongoing CPUC staff costs of approximately $471,000 for 3 PY
(Administrative Law Judge, Analyst, and Legal Counsel) for a
proceeding, conducting additional formal hearings in carrier
permit revocation cases, and associated formal litigation, as
well as staff time associated with the administration of
safety recall provisions. (Transportation Reimbursement
Account)
Background: Existing law provides for the regulation of private carriers
of passengers, passenger stage corporations, and charter-party
carriers by the CPUC. Private carriers of passengers are
not-for-hire motor carriers that transport passengers, such as
those used by churches and nonprofit entities. Passenger stage
corporations provide transportation to the general public on an
individual fare basis, such as scheduled bus operators with
buses that operate on a fixed route and scheduled services, or
airport shuttles that operate on an on-call door-to-door share
the ride service. Charter party carriers provide transportation
services to individuals or groups for compensation on a
pre-arranged basis, and may provide limousine, tour bus, charter
bus, party bus, or sightseeing services. Existing law defines a
tour bus as a vehicle designed, used, or maintained to carry
more than 10 persons, including the driver, and operated by a
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passenger stage corporation or a charter party carrier.
Existing law requires passenger stage corporations and
charter-party carriers obtain a permit and register all
individual buses with the CPUC. These entities must also
conduct safety inspections on each of their buses at least every
45 days, correct any defects that are found during an inspection
before transporting passengers, and maintain detailed records of
inspections and repairs.
Existing law requires CHP to inspect the maintenance facilities
or terminals of tour bus operators at least once every 13
months; inspections of operators with 100 or fewer buses are
scheduled in advance, but inspections for those with over 100
buses are unannounced. CHP inspects a representative subset of
each carrier's buses and records to verify that buses are being
maintained in accordance with the law. Charter party carriers
are charged a fee of $15 per bus (not to exceed $6,500 total per
carrier) to offset the cost of inspection. These fees are
deposited in the state Motor Vehicle Account. Passenger stage
corporations 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.
Proposed Law:
SB 812 would make changes to CHP's bus terminal inspection
program. Specifically, this bill would:
Require CHP to adopt regulations by January 1, 2018 to modify
its tour bus inspection program to ensure that the
performance-based program targets companies that are
noncompliant, have a history of noncompliance with safety laws
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or regulations, or that have received unsatisfactory ratings.
Require a maintenance facility or terminal that receives an
unsatisfactory rating to be inspected every six months until
the operator receives a satisfactory rating.
Require CHP to conduct a follow-up inspection within 30 days
after an initial inspection of a carrier that received an
unsatisfactory rating, rather than 120 days.
Require tour bus operators that are subject to bi-annual
inspections to obtain a satisfactory inspection rating for any
newly acquired bus that is more than two years old prior to
operation of that bus.
Require the CPUC to suspend a passenger stage corporation's or
charter party carrier's certificate or permit to operate,
pending a hearing on the matter, for receiving unsatisfactory
ratings in three consecutive terminal inspections.
Authorize a maintenance facility or terminal that receives two
or more successive satisfactory ratings to be inspected every
26 months, rather than every 13 months, unless the
satisfactory rating is the result of a reinspection.
Require CHP to recommend to the CPUC that a tour bus or
modified limousine carrier's operating authority be suspended,
denied or revoked if that carrier has either received an
unsatisfactory compliance rating for a regular terminal
inspection and two consecutive follow-up inspections, or
received that rating for three consecutive inspections.
Require CHP to immediately order a tour bus out of service if
it determines that the bus has multiple safety violations that
make operation an imminent danger to public safety. The bus
may not be operated until all violations have been corrected
and verified by CHP in a subsequent inspection, which shall
occur within five days of a reinspection request.
Require CHP to conduct unannounced surprise inspections of
tour bus operators in addition to regularly scheduled
inspections.
Require CHP to prioritize surprise inspections of companies
that are noncompliant, have a history of noncompliance with
safety laws or regulations, or that have received
unsatisfactory ratings.
Require at least 10 percent of tour bus carrier inspections in
a given fiscal year to be surprise inspections.
Require CHP, by regulation, to develop and adopt a fee
structure for bus terminal inspections, with fees that are
scaled and based upon the number of buses a company operates,
and charged in an amount to offset costs to administer the
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inspection program, as specified.
Specify that the fees would be charged to both passenger stage
corporations and charter party carriers, and retains the
$6,500 cap for each tour bus operator.
Specify that the current fee structure for charter party
carriers will remain in place until CHP adopts the new fee
structure.
The bill would also require the CPUC to monitor National Highway
Traffic Safety Administration's (NHTSA's) recall notifications
relative to buses, limousines, and modified limousines operated
by passenger stage corporations, charter party carriers, and
private carriers of passengers. The CPUC must immediately
contact the operator affected by a recall that involves parts or
accessories necessary for safe operation to ensure that the
entity is aware of the recall and has a plan in place to correct
the defect. The bill authorizes the CPUC to issue an
out-of-service order for any vehicle affected by such a recall.
Related
Legislation: AB 1574 (Chiu), pending on the Assembly
Appropriations Committee's Suspense File, requires the CPUC to
verify with the Department of Motor Vehicles that the buses,
limousines, and modified limousines used by a passenger stage
corporation or a charter party carrier have been reported to the
CPUC and meet safety requirements.
AB 1677 (Ting), pending on the Assembly Appropriations
Committee's Suspense File, requires CHP to develop protocols for
entering into agreements with local governments to increase the
number of tour buses inspected by CHP.
Staff
Comments: CHP indicates that it currently inspects nearly 2,500
tour bus terminals and nearly 5,200 individual buses annually
that are subject to the requirements of SB 812. Approximately
93 percent of terminals receive a satisfactory rating, and the
number of individual buses that are taken out of service as a
result of safety violations is currently unknown, but could
represent more than 10 percent of those inspected. The current
inspection fees of $15 per bus, with a maximum charge of $6,500
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per operator, which is only charged to charter party carriers,
is not sufficient to offset the costs to administer the program.
SB 812 would make significant revisions to the inspection
program, and impose new requirements on CHP, such as additional
annual surprise inspections, more frequent reinspections of
terminals that receive unsatisfactory ratings, additional
inspections of buses when they are initially put into service by
specified operators, and additional inspections of buses before
returning to service after failing safety inspections. The net
overall impact over time is difficult to predict, but the bill
will require CHP to conduct significantly more inspections each
year over the first several years of the modified program.
Staff estimates that the bill would conceivably result in
hundreds of additional annual bus inspections as well as
hundreds of additional terminal inspections, which could require
an additional 6 to 8 PY of inspection staff at a cost of
approximately $500,000 to $700,000 annually. Initial training
and equipment costs for inspection personnel would add an almost
equivalent amount to the first year staff costs. The number of
inspections will decrease over time as carriers that
consistently receive satisfactory ratings would only be subject
to inspection every 26 months, rather than every 13 months, and
the program focuses inspection efforts on habitually
non-compliant carriers and unsafe vehicles. Staff notes that
these factors would partially mitigate new costs for additional
personnel, and the bill also requires CHP to adopt a revised fee
schedule that would fully offset the costs to administer the
program.
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