BILL ANALYSIS �
Senate Appropriations Committee Fiscal Summary
Senator Christine Kehoe, Chair
AB 2118 (Butler) - Household goods carriers.
Amended: August 6, 2012 Policy Vote: E,U&C 12-0
Urgency: No Mandate: Yes
Hearing Date: August 6, 2012 Consultant:
Bob Franzoia
This bill does not meet the criteria for referral to the
Suspense File.
Bill Summary: AB 2118 would amend the Household Goods Carriers
Act to enhance the authority of the Public Utilities Commission
to regulate household goods carriers.
Fiscal Impact: $95,000 annually from the Transportation
Reimbursement Account.
Background: The Household Goods Carriers Act prevents carriers
from engaging in the business of transporting used household
goods over any public highway, including advertising,
soliciting, offering, or entering into an agreement, without a
permit issued by the commission.
Proposed Law: This bill:
(1) Identifies "broker" as a person engaged by others in the act
of arranging for service by a household goods carrier and makes
a "broker" subject to permit requirements.
(2) Clarifies that an entity falling within the definition of
"household goods carrier," including a "broker," is subject to
penalties regardless of whether it has obtained a permit and
maintains the failure to obtain a permit as a separate
violation.
(3) Increase fines from a maximum of $1,000 to $2,500 and
requires that the fine for a violation that involves operating
or holding oneself out as a household goods carrier without a
permit be not less than $1,000.
(4) Authorizes the commission to suspend or revoke a household
goods carrier's permit, or assess a fine, for unauthorized use
of another person's trademark and authorizes assessments to
cover the expense of a commission trademark infringement
investigation.
AB 2118 (Butler)
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(5) Requires every household goods carrier to add a link to its
Internet Web site that immediately directs all consumers to the
commission's Internet Web site related to protection for
consumers of moving companies and household goods carriers.
(6) Authorizes the release, without customer consent, of the
name and address of a subscriber whose telephone number is being
use by a household goods carrier operating without a permit.
(7) Require the commission to adopt rules for meeting
requirements related to household goods carriers' records,
customer contracts, signatures, insurance, and other
documentation with electronic records.
Staff Comments: According to the commission, consumers who hire
a household goods carrier that has not obtained a permit are
potentially subject to excessive charges, uninsured losses, and
other service problems. Carriers operating without a permit
have an unfair cost advantage over permitted carriers because
they maintain inadequate liability and workers' compensation
insurance, which is a substantial expense for lawful operators.
As a consequence, carriers who obtain a permit and comply with
the rules lose business to the violators, which in turn, make it
more difficult for them to fully comply with insurance and
safety standards, all to the detriment of consumers.
The commission indicates its enforcement staff receives many
complaints about carriers without permits, many from licensed
carriers or from industry trade groups. Stopping the violators
is difficult because of the relative anonymity afforded by
Internet advertising and because many carriers claim to be
operating only as a "broker" and thus not subject to permit
requirements. Unsuspecting customers are frequently subject to
abusive practices such as "holding goods hostage" - refusal to
deliver goods until the customer pays additional charges not
disclosed when the service was arranged.
Because a violation of the Household Goods Carriers Act or an
order of the commission is a crime, this bill would impose a
state mandated local program. No reimbursement is required.
AB 2118 (Butler)
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