BILL ANALYSIS �
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|SENATE RULES COMMITTEE | AB 1524|
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THIRD READING
Bill No: AB 1524
Author: Allen (D), et al.
Amended: As introduced
Vote: 21
SENATE ENERGY, UTIL. & COMMUNIC. COMM. : 9-0, 5/15/12
AYES: Padilla, Fuller, Berryhill, Corbett, DeSaulnier,
Kehoe, Pavley, Simitian, Wright
NO VOTE RECORDED: De Le�n, Emmerson, Rubio, Strickland
SENATE APPROPRIATIONS COMMITTEE : Senate Rule 28.8
ASSEMBLY FLOOR : 70-0, 4/12/12 - See last page for vote
SUBJECT : Commercial air carriers: hot air balloons
SOURCE : Author
DIGEST : This bill strikes all sunset clauses thereby
permanently exempting commercial balloon operators from
regulation by the Public Utilities Commission (CPUC) and
maintaining local oversight and mandatory insurance
requirements.
ANALYSIS : Existing law exempts commercial balloon
operators from regulation by CPUC, and instead requires
commercial balloon operators to maintain a minimum of $1
million of liability insurance for a balloon carrying up to
10 passengers, with additional liability coverage of
$100,000 for every additional passenger. When a local
CONTINUED
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government requires a business license, a commercial
balloon operator is required to provide evidence of such
insurance to the local government. These provisions sunset
on January 1, 2013, which would return the regulation of
commercial balloon operators to the CPUC.
Background
According to legislative history suggests that there are or
were 40 to 50 commercial balloon operators which are
primarily located in the Napa and Sonoma Valleys, Palm
Springs/Palm Desert, and the San Diego areas. Because they
are now regulated only at the local level (business license
and proof of insurance) exact numbers are not known. All
pilots of hot air balloons, whether they carry passengers
or not, are required to secure a pilot certificate from the
Federal Aviation Administration (FAA). To carry passengers
for hire the pilot must have a commercial pilot
certificate. Airworthiness standards are also set by the
FAA for "manned free balloons" which include flight
requirements, strength requirements, and design
construction. Until 2004 the CPUC also had regulatory
authority over commercial balloon operators the impact of
which was nothing more than mandatory liability insurance
requirements.
In 2004 balloon operators expressed concerns about the
ballooning cost of liability insurance, the lack of
availability of such insurance, and frustration with the
regulatory mechanisms of the CPUC which treated balloon
operators the same as operators of other aircraft. Balloon
operators argued that California was the only state to
establish minimum liability requirements for commercial
ballooning and that California had the lowest accident rate
among the major ballooning states. Recognizing these
concerns, the Legislature passed, without dissent, AB 2430
(Wiggins), Chapter 881, Statutes of 2004,which established
minimum insurance requirements in statute, required
notification to passengers of the operator's liability
coverage, required proof of coverage to the local
government entity granting the ballooning company a
business license, and removed the CPUC's jurisdiction.
These changes were made effective for four years to allow
experience with the new rules and extended in 2008 through
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2013.
The National Transportation and Safety Board is responsible
for investigating accidents and incidents involving hot air
balloons. Its database reports 66 accidents and incidents
since 1961 in California. Since 2000 there have been 12
ballooning accidents in California, two of which resulted
in two fatalities.
FISCAL EFFECT : Appropriation: No Fiscal Com.: Yes
Local: Yes
SUPPORT : (Verified 5/25/12) (per Senate Energy,
Utilities and Communications Committee analysis - unable to
verify at time of writing)
Balloons Above the Valley
Napa Valley Balloons, Inc.
Professional Balloon Pilot's Association
Public Utilities Commission
Up and Away Ballooning
ASSEMBLY FLOOR : 70-0, 4/12/12
AYES: Achadjian, Alejo, Ammiano, Atkins, Beall, Bill
Berryhill, Block, Blumenfield, Bonilla, Bradford,
Brownley, Buchanan, Butler, Charles Calderon, Campos,
Carter, Chesbro, Conway, Davis, Dickinson, Donnelly, Eng,
Feuer, Fong, Fuentes, Furutani, Beth Gaines, Galgiani,
Gatto, Gorell, Grove, Hagman, Halderman, Hall, Harkey,
Hayashi, Roger Hern�ndez, Hill, Huber, Hueso, Huffman,
Jeffries, Jones, Knight, Lara, Logue, Ma, Mansoor,
Mendoza, Miller, Mitchell, Monning, Nestande, Nielsen,
Olsen, Pan, Perea, V. Manuel P�rez, Portantino, Silva,
Skinner, Smyth, Solorio, Swanson, Torres, Valadao,
Wagner, Williams, Yamada, John A. P�rez
NO VOTE RECORDED: Allen, Cedillo, Cook, Fletcher, Garrick,
Gordon, Bonnie Lowenthal, Morrell, Norby, Wieckowski
RM:k 6/26/12 Senate Floor Analyses
SUPPORT/OPPOSITION: SEE ABOVE
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