BILL ANALYSIS Ó
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|SENATE RULES COMMITTEE | SB 812|
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THIRD READING
Bill No: SB 812
Author: Hill (D), et al.
Amended: 5/31/16
Vote: 21
SENATE TRANS. & HOUSING COMMITTEE: 10-0, 4/5/16
AYES: Beall, Cannella, Allen, Bates, Galgiani, Leyva, McGuire,
Mendoza, Roth, Wieckowski
NO VOTE RECORDED: Gaines
SENATE ENERGY, U. & C. COMMITTEE: 11-0, 4/19/16
AYES: Hueso, Morrell, Cannella, Gaines, Hertzberg, Hill, Lara,
Leyva, McGuire, Pavley, Wolk
SENATE APPROPRIATIONS COMMITTEE: 7-0, 5/27/16
AYES: Lara, Bates, Beall, Hill, McGuire, Mendoza, Nielsen
SUBJECT: Charter-party carriers of passengers: passenger
stage corporations
SOURCE: Author
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. This bill also increases state oversight of
recalled limousines and buses.
ANALYSIS:
Existing law:
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1) Requires that charter-party carriers of passengers and
passenger stage corporations:
a) Obtain a permit from the California Public Utilities
Commission (CPUC);
b) Register all individual buses with the CPUC;
c) Conduct safety inspections on each of their buses at
least every 45 days;
d) Correct any defects that are found during an
inspection before transporting passengers; and
e) Keep detailed records of inspections and repairs
performed.
2) Requires the CHP to:
a) Conduct annual 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. For carriers with fewer than 100 buses,
inspections are scheduled. For carriers with more than
100 buses, inspections are not scheduled in advance.
b) Collect a fee of $15 per bus (not to exceed $6,500
total) to offset the cost of terminal inspections of
charter party carriers. These fees are deposited in the
state Motor Vehicle Account.
c) Reinspect, within 120 days, any terminal that receives
an "unsatisfactory" rating in an inspection.
3) Authorizes the CHP to recommend that the CPUC suspend a
carrier's operating authority when the CHP finds violations
at a terminal that constitute an imminent threat to public
safety or a consistent failure to comply with regulations.
4) Requires the CPUC to follow the CHP's recommendation,
pending a hearing.
This bill:
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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, this bill:
a) Allows the CHP to inspect terminals with two or more
consecutive satisfactory ratings every 26 months as
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;
c) When a terminal receives an unsatisfactory rating in a
regular inspection, requires the CHP to conduct a
follow-up inspection within 30 days; and
d) Requires any operator that is being inspected every
six months and acquires a bus that is more than two years
old to have the vehicle inspected by the CHP before it is
used to transport passengers.
2) Requires the CPUC to suspend the operating license of a
passenger stage corporation or charter party carrier of
passengers that receives an unsatisfactory rating in three
consecutive terminal inspections, pending a hearing.
3) 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.
4) 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.
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
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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
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. 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
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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, 2016), a companion bill which compels the CPUC
and 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) 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.
6) New fee structure. The existing terminal inspection fee of
$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
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cap in existing law.
7) 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 more frequent checks of poorly performing
operators would increase the safety of bus travel.
8) 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)
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.
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9) 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. Revoking
operating authority from chronically noncompliant carriers is
another way to protect public safety that can also act as a
cap on the number of additional inspections the state must
undertake. This bill therefore also requires the CHP to
recommend suspending an operator's license after it receives
three consecutive unsatisfactory ratings on terminal
inspections. An operator is considered to have received
three consecutive unsatisfactory ratings if it obtained (a)
an unsatisfactory compliance rating in a regular terminal
inspection and the next two consecutive follow-up terminal
inspections, or (b) 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.
10)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.
11)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
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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.
FISCAL EFFECT: Appropriation: No Fiscal
Com.:YesLocal: Yes
According to the Senate Appropriations Committee:
1)Estimated CHP costs of up to $75,000 to develop and adopt
regulations to modify the tour bus inspection program and the
fee schedule. (Motor Vehicle Account)
2)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)
3)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)
4)One-time CPUC costs of approximately $100,000 to make
necessary automation upgrades. (Transportation Reimbursement
Account)
5)Ongoing CPUC staff costs of approximately $330,000 for PY
(Administrative Law Judge and Legal Counsel) for a proceeding,
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conducting additional formal hearings in carrier permit
revocation cases, and associated formal litigation.
(Transportation Reimbursement Account)
SUPPORT: (Verified5/27/16)
California Association of Highway Patrolmen
California Bus Association
City and County of San Francisco
OPPOSITION: (Verified5/27/16)
None received
Prepared by:Randy Chinn / Sarah Carvill / T. & H. / (916)
651-4121
5/31/16 21:58:39
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