BILL ANALYSIS
AB 1186
Page 1
GOVERNOR'S VETO
AB 1186 (Blumenfield)
As Amended August 18, 2009
2/3 vote
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|ASSEMBLY: |57-20|(June 1, 2009) |SENATE: |22-17|(September 3, |
| | | | | |2009) |
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|ASSEMBLY: |49-28|(September 9, | | | |
| | |2009) | | | |
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Original Committee Reference: TRANS.
SUMMARY : Requires the lessor of a nonresidential building,
located within an air basin designated as a nonattainment area,
to list the parking costs as a separate line item in all lease
agreements entered into or renewed on or after January 1, 2011,
if the tenants of the building are provided parking. Specifies
that this bill's provisions are only applicable if the lease
involves a nonresidential building that has a maximum occupancy
of 50 or more persons.
The Senate amendments :
1)Require that the lessor provide a list of parking costs to the
lessee within 30 days after the lease is entered into or
renewed.
2)Establish that the lessee furnishing of information does not
create rights to employees as specified.
3)Link provisions to the enactment of SB 728 (Lowenthal), should
that bill be enacted before this bill.
EXISTING LAW :
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1)Requires that, in any air basin designated as an air quality
nonattainment area, that each employer of 50 persons or more
who provides a parking subsidy to employees, to offer a
parking cash-out program. Under the program, an employer
offers to provide a cash allowance to an employee equivalent
to the parking subsidy that the employer would otherwise pay
to provide the employee with a parking space.
2)Establishes the California Air Resources Board (ARB) to
implement air quality mitigation programs that reduce
emissions from motor vehicles, fuels, consumer products, and
sources of air toxics at the state level. It also oversees
local air pollution agencies.
3)Authorizes ARB to administer the Parking Cash-Out Program
(PCOP). Violations of PCOP are subject to civil penalties not
to exceed $500 per vehicle per civil action.
4)Enacts, pursuant to AB 32 (Nunez and Pavley), Chapter 488,
Statutes of 2006, the Global Warming Solutions Act of 2006,
that directs ARB to implement a statewide greenhouse gas
emissions reduction strategy that would reduce emissions by
25% by 2020.
AS PASSED BY THE ASSEMBLY , this bill was substantially similar
to the version passed in the Senate.
FISCAL EFFECT : None
COMMENTS : The author contends that "employers are not taking
advantage of an existing state program - the parking cash-out
program - because it is too difficult to calculate the value of
employee parking when it is included with the total cost of
office rental space. Consequently, this bill requires a lessor
of a nonresidential building that offers parking to its tenants
to list the parking costs as a separate line item in all lease
agreements?The goal of this bill is to bring about greater use
of the existing parking cash-out program, in order to gain the
resulting benefits of traffic congestion relief and air
pollution reductions?Many owners of commercial real estate offer
"bundled" parking with all other leased office space. This
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practice makes it difficult, if not impossible, for employers to
separate the cost of parking spaces associated with the
commercial space that is being leased. Without that
information, employers are unable to offer employees cash in
lieu of parking subsidies."
PCOP: Existing law requires certain employers that provide a
parking subsidy to employees to provide a cash allowance to an
employee who does not use the parking space, an amount
equivalent to the amount the employer would otherwise pay to
provide that employee a parking space. The law establishes the
PCOP that is administered by ARB. For compliance with PCOP, an
employer must offer a cash-out option if the company has the
following characteristics:
1)Employs at least 50 persons, regardless of the number of work
sites.
2)Is located in an air basin designated nonattainment for any
state air quality standard.
3)Provides free or subsidized employee parking on leased spaces
(i.e., on spaces the employer does not own).
4)Can calculate the expense of the parking subsidy, which means
the parking is leased separately from the building or office
space.
5)Is able to reduce the number of leased parking spaces without
financial penalty.
Although ARB is the agency responsible for implementing PCOP,
existing law does not require ARB to enforce or monitor the
program; nor does it contain reporting requirements for
employers, which makes it difficult for ARB to assess whether or
not an employer is in compliance. The potential of parking
cash-out to alleviate congestion and reduce greenhouse gas
emissions depends on assessing employer compliance with the
cash-out requirement.
Legislative Analyst's Office (LAO) Report: In the March 2002
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report by the LAO that examines the PCOP, it cited a 1990 study
that found a 41% average reduction in solo driving when
employees had to pay to park. The LAO also noted a 2000 survey
of Bay Area commuters, which found that while 77% of commuters
drive alone to work when free parking is available, only 39% do
so when they have to pay to park. Further, the report indicates
that PCOP is inexpensive to administer and offers numerous
benefits, including easing traffic congestion, improving air
quality, reducing greenhouse gas emissions, promoting social
equity, and supporting investments in other travel modes.
However, the report declares that the "implementation of the
program has been slow. Additionally, outreach efforts have been
limited such that it is not clear all affected employers are
aware of the statutory requirements. This limits the potential
impact of the law."
SB 728 (Lowenthal) of 2009: Basically authorizes local entities
to enforce the provisions of the PCOP. That bill was chaptered
by the Secretary of State (Chapter 359) on October 11, 2009.
GOVERNOR'S VETO MESSAGE :
This bill requires the lessor of a nonresidential
building located within an nonattainment area to
itemize parking costs in all lease agreements
entered into or renewed after January 1, 2011 if the
tenants of the building are provided free parking.
I recognize that the current cash-out parking
program faces many implementation challenges and
many have called for various modifications to
improve this program. For this reason, I have
signed SB 728 (Lowenthal) which would clarify that
either the California Air Resources Board or a local
air district may enforce the existing parking
cash-out law.
With respect to this bill, although well-intended, I
am concerned about placing an additional burden on
commercial property owners at this time. It is my
hope that better enforcement will shed more light on
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the challenges and effectiveness of this program.
Analysis Prepared by : Ed Imai / TRANS. / (916) 319-2093
FN: 0003285