BILL ANALYSIS �
AB 612
Page 1
CONCURRENCE IN SENATE AMENDMENTS
AB 612 (Nazarian)
As Amended August 19, 2014
Majority vote
-----------------------------------------------------------------
|ASSEMBLY: | |(May 9, 2013) |SENATE: |21-11|(August 21, |
| | | | | |2014) |
-----------------------------------------------------------------
(vote not relevant)
Original Committee Reference: TRANS.
SUMMARY : Requires charter-party carriers (CPC) to participate
in the Department of Motor Vehicles (DMV) Employer Pull Notice
system (EPN) and submit all drivers to a Department of Justice
(DOJ) criminal background check.
The Senate amendments delete the Assembly version of the bill,
and instead:
1)Prohibit the California Public Utilities Commission (PUC) from
issuing or renewing a permit or certification to a CPC unless
the applicant, in addition to existing requirements:
a) Participates in DMVs EPN system; and,
b) Submits all of its drivers to a DOJ background check as
specified.
2)Specify that CPC drivers are required to submit fingerprint
images to DOJ for purposes of carrying out background checks
and permit DOJ to charge a fee to cover the cost of providing
background checks.
3)Require a CPC driver to be denied employment or have their
contract voided if they are required by any law to register as
a sex offender or have been convicted of any specified felony,
within a seven-year period from the date of his or her
application.
4)Require all CPCs, regardless of class or category, to
participate in the EPN system, mandatory controlled substance
and alcohol testing, and the DOJ background check process.
AB 612
Page 2
5)Specify that drivers hired or initially retained by a CPC on
or after January 1, 2015, are subject to the abovementioned
requirements. Further specifies that CPC drivers hired or
initially retained prior to January 1, 2015, are required to
complete the abovementioned requirements before January 1,
2016.
6)Clarify that all CPC drivers are required to participate in
the EPN system. Further clarifies that a CPC employer is the
entity subject to PUC permitting and certificate requirements.
7)Delete provisions related to yellow-light intervals.
EXISTING LAW :
1)Establishes the "Passenger Charter-Party Carriers Act," which
directs PUC to issue permits or certificates to CPCs,
investigate complaints against carriers, and cancel, revoke,
or suspend permits and certificates for specific violations.
2)Defines "charter-party carrier of passengers" as every person
engaged in the transportation of persons by motor vehicle for
compensation, whether in common or contract carriage, over any
public highway in the state.
3)Requires CPCs to operate on a prearranged basis. Further
defines "prearranged basis" to mean that the transportation of
the prospective passenger was arranged with the carrier by the
passenger, or a representative of the passenger, either by
written contract or telephone.
4)At the regulatory level, establishes transportation network
company (TNCs) as a category of CPCs and defines a TNC as an
organization whether a corporation, partnership, sole
proprietor, or other form, operating within the state that
provides prearranged transportation services for compensation
using an online-enabled application or platform to connect
passengers with drivers using their personal vehicles.
5)Establishes the EPN system administered by the DMV that
provides the employer of a driver who drives a specified type
of vehicle with a report showing the driver's current public
record and any subsequent convictions, driver's license
revocations, failures to appear, accidents, driver's license
AB 612
Page 3
suspensions, driver's license revocations, or any other
actions taken against the driving privilege.
6)Requires employers of drivers of specified vehicles such as
commercial truck drivers, school buses, farm labor vehicles,
tow trucks, youth buses, paratransit vehicles, ambulances,
vehicles that transport hazardous materials, to show EPN
reports, during regular business hours, upon the request of
the California Highway Patrol (CHP).
7)Requires employers of drivers of specified vehicles as
described above to obtain EPN reports from DMV at least every
12 months that is to be signed, dated, and maintained by the
employer.
8)Requires DOJ to maintain criminal history information on any
person within the state and requires DOJ to generate a report
to a requesting entity, as specified.
FISCAL EFFECT : Unknown
COMMENTS : Existing law requires PUC to regulate various
transportation services, including CPCs. CPCs perform various
types of transportation services including, but not limited to,
a limousine with seating capacity up to eight passengers, a bus
providing prearranged services with capacity up to 15
passengers, or buses providing round-trip sightseeing trips. In
order to obtain an operating permit or certificate from PUC,
CPCs must meet a number of requirements including providing
sufficient proof of financial responsibility, maintaining a
preventative maintenance program for all vehicles, possessing a
safety education and training program, and regularly checking
the driving records of all persons operating vehicles used in
transportation for compensation.
In a September 2013 decision, PUC began regulation of the new
online app-based ride services by creating a distinct new
category of CPCs called TNCs. PUC tailored specific new rules
in response to the introduction of new technology into an
existing industry. The decision requires TNCs to obtain a permit
from the PUC, conduct criminal background checks of drivers,
establish a driver training program, implement a zero-tolerance
policy on drugs and alcohol, conduct vehicle inspections, and
obtain authorization from airports before conducting any
operations on or into airport property. The decision also
AB 612
Page 4
requires each TNC to maintain commercial liability insurance
policies providing not less than $1 million per-incident
coverage for incidents occurring under specific conditions.
The author states that this bill was introduced in attempt to
provide additional clarification to the TNC regulations set
forth by PUC and to also bring into alignment inconsistent
requirements that currently exist between TNCs and other CPC
providers. Specifically, this bill requires all CPCs, including
TNCs, to participate in the EPN system, to be subject to
mandatory alcohol and controlled substance testing, and undergo
criminal background checks through DOJ.
DMV's EPN was established as a voluntary program in 1983 to
provide employers and regulatory agencies with a means of
providing driver safety through the ongoing review of driver
records. By 1998, the EPN system had expanded to require
participation by most commercial drivers, including drivers
transporting property, passengers, and household goods. The
current EPN system is designed to automatically generate a
report of a driver's record and electronically send the report
to the employer under specific circumstances including: upon
enrollment of a driver, annually from the date of employment, or
whenever a driver commits certain moving violations (e.g.
accidents, driving under the influence, suspended driver's
license). Presently, approximately 1.6 million commercial
drivers are enrolled in the EPN system and while specific types
of CPC drivers are currently required to be enrolled in EPN, TNC
drivers are not subject to the same requirement. This bill will
expand the EPN system by clarifying that all CPC drivers,
including TNC drivers, are required to enroll in EPN, thus
providing TNCs such as Uber, Lyft, and Sidecar, with timely
information on the DMV records of the drivers they employ.
This bill also intends to address a discrepancy related to
existing mandatory alcohol and substance testing requirements.
The PUC's September 2013 regulations require TNCs to implement a
zero-tolerance alcohol and controlled substance use policy and
provide riders with information on how to report a driver
AB 612
Page 5
suspected of being under the influence of intoxicating
substances. The regulations further provide that TNCs are
required to suspend a driver promptly after a zero-tolerance
complaint is filed. However, this regulation differs from
existing PUC requirements for other types of CPCs which are
required to participate in mandatory and periodic alcohol and
controlled substance testing on top of implementing a
zero-tolerance policy. In order to remedy this discrepancy,
this bill expands the mandatory testing requirement to apply to
all CPCs and their drivers.
Lastly, this bill will require all CPC drivers to now undergo
criminal background checks. PUC regulations require TNCs to run
criminal background checks on all hired drivers yet the same
requirement does not apply to other types of CPCs. Furthermore,
while PUC regulations require driver background checks,
regulations lack specific parameters as to how TNCs are to
proceed with this requirement. As a result, TNCs may, for
example, use a third party firm that fails to provide a
comprehensive search - for instance, only reviewing online
digital records, thus failing to capture any data from
jurisdictions that exclusively maintain hard copy criminal
records. This bill will bring all CPCs up to the same standards
by requiring all drivers to undergo criminal background checks
and provides a uniform process by using the DOJ system to ensure
the most comprehensive and updated data of an employee is
provided to all CPCs.
With the demand for online app-based transportation services
continuing to rise, the provisions in this bill aim to mitigate
the public safety issues and incidents that have been widely
reported related to TNCs over the past year and to also provide
clarification that all CPCs will be subject to specific PUC
requirements. The author asserts that this bill will provide
the necessary tools to ensure the public is safe and closes the
gaps that currently exist between TNCs and other CPC providers.
This bill was substantially amended in the Senate and the
Assembly-approved version of this bill was deleted. This bill,
AB 612
Page 6
as amended in the Senate, is inconsistent with Assembly actions
and the provisions of this bill, as amended in the Senate, have
not been heard in an Assembly policy committee.
Analysis Prepared by : Manny Leon / TRANS. / (916) 319- 2093
FN: 0005135