BILL NUMBER: AB 612 AMENDED
BILL TEXT
AMENDED IN SENATE JUNE 19, 2014
AMENDED IN SENATE JUNE 10, 2014
AMENDED IN SENATE MAY 29, 2014
AMENDED IN ASSEMBLY MARCH 19, 2013
INTRODUCED BY Assembly Member Nazarian
( Coauthor: Assembly Member
Hernández )
FEBRUARY 20, 2013
An act to amend Section 5374 of , to add Sections 5374.3
and 5374.4 to, and to repeal Sections 5385.5 and 5391 of,
the Public Utilities Code, relating to transportation.
LEGISLATIVE COUNSEL'S DIGEST
AB 612, as amended, Nazarian. Charter-party carriers of
passengers: online-enabled application or platform.
permit requirements: drivers.
(1) The
The Passenger Charter-party Carriers' Act, with certain
exceptions, prohibits a charter-party carrier of passengers from
engaging in transportation services subject to regulation by the
Public Utilities Commission without obtaining a specified certificate
or permit, as appropriate, from the commission, and imposes
subject to various other
requirements. Existing law imposes certain penalties for
violation of the act. The act defines a 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 this state and includes
any person, corporation, or other entity engaged in the provision of
a hired driver service when a rented motor vehicle is being operated
by a hired driver.
This bill would prohibit the commission from issuing or renewing a
permit or certificate to a charter-party carrier of passengers
unless the applicant, in addition to existing requirements,
participates in the Department of Motor Vehicles Employer Pull Notice
Program and provides for mandatory Department of Justice background
checks of every driver who is either employed by or under contract to
the applicant, as specified.
Pursuant to existing law, the commission has adopted rules and
regulations relating to public safety risks in the operation of
transportation network companies. Those rules and regulations define
a transportation network company as an organization that provides
prearranged transportation services for compensation using an
online-enabled application or platform to connect passengers with
drivers using their personal vehicles.
This bill would establish specified requirements applicable to a
charter-party carrier of passengers and any carrier that utilizes an
online-enabled application or platform to connect passengers with
drivers. The bill would require a charter-party carrier of passengers
to participate in the Department of Motor Vehicle's Employer Pull
Notice Program. The
The bill would also require any driver who
is either under contract to, or employed by, the carrier to operate a
vehicle used in transportation for compensation under the act to
furnish to the Department of Justice 2
classifiable fingerprint cards which the carrier would be
required to forward to the Department of Justice to conduct a
criminal history background check, as specified and would
prohibit the carrier from employing or contracting with a driver who
fails that check, as specified .
The bill would require assurances of protection against liability
applicable to charter-party carriers under existing law to be primary
and carried by the permit or certificate holder. The bill would
require the commission to develop a standard disclosure agreement
with respect to drivers who make themselves available for services
with carriers that utilize an online-enabled application or platform
to connect passengers with drivers.
The bill would make expressly applicable to carriers that use an
online-enabled application or platform to connect passengers with
drivers certain provisions relating to the issuance of decals.
The bill would require that drivers employed or initially retained
after January 1, 2015, be subject to background checks and mandatory
drug and alcohol testing prior to employment or retention and that
employees hired before January 1, 2015, complete a background check
and drug and alcohol test prior to January 1, 2016.
(2) Because a violation of these provisions would be a crime, the
bill would impose a state-mandated local program.
(3) The California Constitution requires the state to reimburse
local agencies and school districts for certain costs mandated by the
state. Statutory provisions establish procedures for making that
reimbursement.
This bill would provide that no reimbursement is required by this
act for a specified reason.
Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: yes.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1 . Section 5374 of
the Public Utilities Code is amended
to read:
5374. (a) (1) Before a permit or certificate is issued or
renewed, the commission shall require the applicant to establish
reasonable fitness and financial responsibility to initiate and
conduct or continue to conduct the proposed or existing
transportation services. The commission shall not issue or renew a
permit or certificate pursuant to this chapter unless the applicant
meets all of the following requirements:
(A) It is financially and organizationally capable of conducting
an operation that complies with the rules and regulations of the
Department of the California Highway Patrol governing highway safety.
(B) It is committed to observing the hours of service regulations
of state and, where applicable, federal law, for all persons, whether
employees or subcarriers, operating vehicles in transportation for
compensation under the certificate.
(C) It has a preventive maintenance program in effect for its
vehicles used in transportation for compensation that conforms to
regulations of the Department of the California Highway Patrol in
Title 13 of the California Code of Regulations.
(D) It participates in a program the
Department of Motor Vehicle's Employer Pull Notice Program to
regularly check the driving records of all persons, whether employees
or subcarriers, operating vehicles used in transportation for
compensation.
(E) It has a safety education and training program in effect for
all employees or subcarriers operating vehicles used in
transportation for compensation.
(F) It will maintain its vehicles used in transportation for
compensation in a safe operating condition and in compliance with the
Vehicle Code and with regulations contained in Title 13 of the
California Code of Regulations relative to motor vehicle safety.
(G) It has filed with the commission the certificate of workers'
compensation insurance coverage or statement required by Section
5378.1.
(H) It has provided the commission an address of an office or
terminal where documents supporting the factual matters specified in
the showing required by this subdivision may be inspected by the
commission and the Department of the California Highway Patrol.
(I) It provides for a mandatory controlled substance and alcohol
testing certification program as adopted by the commission pursuant
to Section 1032.1.
(J) Subparagraphs (C), (F), and (H) do not apply to a
charter-party carrier of passengers engaged in the provision of a
hired driver service when a rented motor vehicle is being operated by
the hired driver.
(K) It provides for mandatory Department of Justice criminal
background checks to check the criminal history of any driver who is
either under contract to, or employed by, the applicant to operate a
vehicle used in transportation for compensation pursuant to the
following:
(i) Upon accepting employment by or entering into a contract with
a carrier, a driver shall obtain two classifiable fingerprint cards
for submission to the Department of Justice. The driver shall submit
to the carrier the fingerprint cards and a processing fee payable to
the department. The carrier shall forward the classifiable
fingerprint cards and the fee to the Department of Justice. The
department shall forward one classifiable fingerprint card to the
Federal Bureau of Investigation for purposes of a background check.
The processing fee shall be in an amount to cover the actual costs to
the department.
(ii) In lieu of classifiable fingerprint cards provided for in
this section, the carrier may authorize drivers to submit their
fingerprints into an electronic fingerprinting system administered by
the Department of Justice. Drivers who submit their fingerprints by
electronic means shall have their fingerprints entered into the
system through a terminal operated by a law enforcement agency or
other facility authorized by the Department of Justice to conduct
electronic fingerprinting. The enforcement agency responsible for
operating the terminal may charge a fee sufficient to reimburse it
for the costs incurred in providing this service.
(iii) Upon receipt of a driver's electronic or hard card
fingerprints as provided in this section, the Department of Justice
shall disseminate the following information to the carrier:
(I) Every conviction rendered against the driver.
(II) Every arrest for an offense for which the driver is presently
awaiting trial, whether the driver is incarcerated or has been
released on bail or on his or her own recognizance pending trial.
(iv) The carrier shall request from the Department of Justice
subsequent notification service, as provided pursuant to Section
11105.2 of the Penal Code.
(v) A driver shall be denied employment or have his or her
contract voided if he or she is required by any law to register as a
sex offender or has been convicted of any felony involving any type
of sexual offense; the manufacture, possession for sale,
transportation, or distribution of narcotics, controlled substances,
or addictive or dangerous drugs; force, violence, threat or
intimidation against persons; kidnapping; forgery, fraud, larceny,
extortion, burglary, robbery, or theft; credit card fraud; possession
of a firearm or dangerous weapon; resisting or obstructing a peace
officer, public officer, or emergency medical technician; or use of
another vehicle for hire in the commission of a felony. Equivalent
out-of-state violations shall be considered.
(vi) As used in this section, "driver" has the same meaning as
defined in Section 305 of the Vehicle Code.
(2) With respect to subparagraphs (B) and (F) of paragraph (1),
the commission may base a finding on a certification by the
commission that an applicant has filed, with the commission, a sworn
declaration of ability to comply and intent to comply.
(3) The commission may require, as a precondition to the issuance
of a permit or certificate, the procurement of a performance bond
sufficient to facilitate the collection of fines, penalties, and
restitution related to enforcement actions that can be taken against
the applicant.
(b) In addition to the requirements in subdivision (a),
charter-party carriers shall meet all other state and, where
applicable, federal regulations as prescribed.
(c) The commission may delegate to its executive director or that
executive director's designee the authority to issue, renew, or
authorize the transfer of, charter-party carrier permits or
certificates and to make the findings specified in subdivision (a)
that are necessary to that delegated authority.
SECTION 1. Section 5374 of the Public Utilities
Code is amended to read:
5374. (a) (1) Before a permit or certificate is issued or
renewed, the commission shall require the applicant to establish
reasonable fitness and financial responsibility to initiate and
conduct or continue to conduct the proposed or existing
transportation services. The commission shall not issue or renew a
permit or certificate pursuant to this chapter unless the applicant
meets all of the following requirements:
(A) It is financially and organizationally capable of conducting
an operation that complies with the rules and regulations of the
Department of the California Highway Patrol governing highway safety.
(B) It is committed to observing the hours of service regulations
of state and, where applicable, federal law, for all persons, whether
employees or subcarriers, operating vehicles in transportation for
compensation under the certificate.
(C) It has a preventive maintenance program in effect for its
vehicles used in transportation for compensation that conforms to
regulations of the Department of the California Highway Patrol in
Title 13 of the California Code of Regulations.
(D) It has a safety education and training program in effect for
all employees or subcarriers operating vehicles used in
transportation for compensation.
(E) It will maintain its vehicles used in transportation for
compensation in a safe operating condition and in compliance with the
Vehicle Code and with regulations contained in Title 13 of the
California Code of Regulations relative to motor vehicle safety.
(F) It has filed with the commission the certificate of workers'
compensation insurance coverage or statement required by Section
5378.1.
(G) It has provided the commission an address of an office or
terminal where documents supporting the factual matters specified in
the showing required by this subdivision may be inspected by the
commission and the Department of the California Highway Patrol.
(H) Subparagraphs (C), (E), and (G), do not apply to a
charter-party carrier of passengers engaged in the provision of a
hired driver service when a rented motor vehicle is being operated by
the hired driver.
(2) With respect to subparagraphs (B) and (E) of paragraph (1),
the commission may base a finding on a certification by the
commission that an applicant has filed, with the commission, a sworn
declaration of ability to comply and intent to comply.
(3) The commission may require, as a precondition to the issuance
of a permit or certificate, the procurement of a performance bond
sufficient to facilitate the collection of fines, penalties, and
restitution related to enforcement actions that can be taken against
the applicant.
(b) In addition to the requirements in subdivision (a),
charter-party carriers shall meet all other state and, where
applicable, federal regulations as prescribed.
(c) The commission may delegate to its executive director or that
executive director's designee the authority to issue, renew, or
authorize the transfer of, charter-party carrier permits or
certificates and to make the findings specified in subdivision (a)
that are necessary to that delegated authority.
SEC. 2. Section 5374.3 is added to the Public
Utilities Code, to read:
5374.3. The commission shall develop a standard disclosure
agreement with respect to drivers who make themselves available for
services with charter-party carriers of passengers that utilize an
online-enabled application or platform to connect passengers with
drivers. The standard disclosure agreement shall be part of a written
agreement between the driver and the charter-party carrier of
passengers, and shall provide information to the driver about
insurance coverage and limits of liability coverage and advise the
driver that their personal automobile insurance policy may not
provide coverage when they are operating a vehicle as part of that
charter-party carrier of passengers operation. The standard
disclosure agreement shall be in writing and shall be signed by each
driver participating in this type of arrangement with a charter-party
carrier of passengers. Standard disclosure agreement records of
charter-party carriers of passengers shall be subject to review and
audit by the commission at its discretion.
SEC. 3. Section 5374.4 is added to the Public
Utilities Code, to read:
5374.4. (a) Notwithstanding Section 5374, the following
requirements shall apply to a charter party carrier of passengers,
including any carrier that utilizes an online-enabled application or
platform to connect passengers with drivers:
(1) It participates in the Department of Motor Vehicle's Employer
Pull Notice Program to regularly check the driving record of any
driver who is either under contract to, or employed by, the carrier
to operate a vehicle used in transportation for compensation.
(2) It provides for a mandatory controlled substance and alcohol
testing certification program as adopted by the commission pursuant
to Section 1032.1.
(3) It provides for mandatory Department of Justice criminal
background checks to check the criminal history of any driver who is
either under contract to, or employed by, the carrier to operate a
vehicle used in transportation for compensation pursuant to the
following:
(A) Upon accepting employment by a charter-party carrier of
passengers or entering into a contract with a carrier that utilizes
an online-enable application or platform to connect passengers with
drivers, a driver shall obtain two classifiable fingerprint cards for
submission to the Department of Justice. The driver shall submit the
fingerprint cards and a processing fee payable to the department to
the carrier. The carrier shall forward the classifiable fingerprint
cards and the fee to the Department of Justice. The department shall
forward one classifiable fingerprint card to the Federal Bureau of
Investigation for purposes of a background check. The processing fee
shall be in an amount to cover the actual costs of the department.
(B) In lieu of classifiable fingerprint cards provided for in this
section, the carrier may authorize drivers to submit their
fingerprints into an electronic fingerprinting system administered by
the Department of Justice. Drivers who submit their fingerprints by
electronic means shall have their fingerprints entered into the
system through a terminal operated by a law enforcement agency or
other facility authorized by the Department of Justice to conduct
electronic fingerprinting. The enforcement agency responsible for
operating the terminal may charge a fee sufficient to reimburse it
for the costs incurred in providing this service.
(C) Upon receipt of a driver's electronic or hard card
fingerprints as provided in this section, the Department of Justice
shall disseminate the following information to the carrier:
(i) Every conviction rendered against the driver.
(ii) Every arrest for an offense for which the driver is presently
awaiting trial, whether the driver is incarcerated or has been
released on bail or on his or her own recognizance pending trial.
(D) The carrier shall request from the Department of Justice
subsequent notification service, as provided pursuant to Section
11105.2 of the Penal Code.
(E) A driver shall be denied employment or have his or her
contract voided if he or she is required by any law to register as a
sex offender or has been convicted of any felony involving: any type
of sexual offense; the manufacture, possession for sale,
transportation, or distribution of narcotics, controlled substances,
or addictive or dangerous drugs; force, violence, threat or
intimidation against persons; kidnaping; forgery, fraud, larceny,
extortion, burglary, robbery, or theft; credit card fraud; possession
of a firearm or dangerous weapon; resisting or obstructing a peace
officer, public officer, or emergency medical technician; or use of
another vehicle for hire in the commission of a felony. Equivalent
out-of-state violations shall be considered.
(F) As used in this section, "driver" has the same meaning as
defined in Section 305 of the Vehicle Code.
(4) It provides decals to be applied to all vehicles used in
transportation for compensation. For motor vehicles designed to carry
not more than eight passengers, including the driver, the commission
shall issue a suitable decal for purposes of Section 5385, for each
vehicle (A) registered with the commission and operated by a
charter-party carrier of passengers holding a valid permit or
certificate of public convenience and necessity or (B) used by a
driver under contract to any carrier that uses an online-enabled
application or platform to connect passengers with drivers. Carriers
using an online-enabled application or platform shall register any
vehicle used in the transportation of passengers for compensation
with the commission and that vehicle shall display the
commission-issued identifying symbol. The decal with an identifying
symbol shall be a minimum size of two and one-half inches by six
inches, and shall be affixed to the lower right hand corner of the
rear bumper of the vehicle.
(5) The carrier's commercial auto liability insurance is primary.
The commission shall, in granting permits or a certificate pursuant
to this chapter, require the charter-party carrier of passengers to
procure, and to continue in effect during the life of the permit or
certificate, adequate protection against liability imposed by law
upon the charter-party carrier of passengers for the payment of
damages for personal bodily injuries, including death resulting
therefrom, protection against a total liability of the charter-party
carrier of passengers on account of bodily injuries to, or death of,
more than one person as a result of any one accident, and protection
against damage or destruction of property. The requirements for these
assurances of protection against liability shall be primary and
shall be carried by the permit or certificate holder. The minimum
requirements for these assurances of protection against liability
shall not be less than the requirements that are applicable to
operations conducted under certificates of public convenience and
necessity issued pursuant to the provisions of Article 2 (commencing
with Section 1031) of Chapter 5 of Part 1 of Division 1, and the
rules and regulations prescribed pursuant thereto shall apply to
charter-party carriers of passengers.
(b) Drivers employed or initially retained after January 1, 2015,
shall be subject to background checks and mandatory drug testing
employment or retention. Employees hired before January 1, 2015,
shall complete a background check and drug test before January 1,
2016.
SEC. 4. Section 5385.5 of the Public Utilities
Code is repealed.
SEC. 5. Section 5391 of the Public Utilities
Code is repealed.
SEC. 6. SEC. 2. No reimbursement is
required by this act pursuant to Section 6 of Article XIII B of the
California Constitution because the only costs that may be incurred
by a local agency or school district will be incurred because this
act creates a new crime or infraction, eliminates a crime or
infraction, or changes the penalty for a crime or infraction, within
the meaning of Section 17556 of the Government Code, or changes the
definition of a crime within the meaning of Section 6 of Article XIII
B of the California Constitution.