BILL ANALYSIS                                                                                                                                                                                                    



                                                                  AB 84
                                                                  Page  1

          Date of Hearing:   April 30, 2003

                        ASSEMBLY COMMITTEE ON APPROPRIATIONS
                              Darrell Steinberg, Chair

                    AB 84 (Cogdill) - As Amended:  April 22, 2003 

          Policy Committee:                              Utilities and  
          Commerce     Vote:                            14-0

          Urgency:     No                   State Mandated Local Program:  
          No     Reimbursable:               

           SUMMARY  

          This bill:

          1)Reinstates the annual audit requirement for funds received by  
            the Public Utilities Commission (PUC) for rail safety-related  
            regulation.

          2)Requires the Bureau of State Audits to contract for the audit  
            and limits the contract cost to $75,000 with annual inflation  
            adjustments.

           FISCAL EFFECT  

          Annual cost of $75,000 for the audit from regulatory fees paid  
          by the railroad industry into the Transportation Reimbursement  
          Account.

           COMMENTS  

           1)Background  .  After the Dunsmuir train derailment and other  
            rail accidents in 1991, several bills were passed to enhance  
            and ensure the safety of California's railroads.  One bill  
            provided the PUC with the authority to collect fees from the  
            railroads to fund enhanced rail safety inspection and  
            enforcement of railroad safety standards.  (In the current  
            fiscal year, these fees total about $3 million.)  From 1993-94  
            through 1999-2000, the PUC was also statutorily required to  
            conduct an audit of the expenditure of these regulatory funds.  
             From 1996-97, these audits were conducted by the BSA with  
            reimbursement from the PUC.









                                                                  AB 84
                                                                  Page  2

           2)Purpose  .  The railroad industry-sponsor of this measure-is  
            concerned with the PUC's merging of the Rail Safety and  
            Carrier Division into a new Consumer Protection and Safety  
            Division that combines safety inspection and enforcement  
            functions related to freight railroads with other utility  
            regulatory functions.  The industry is concerned that the PUC  
            is not capable of adequately segregating its rail safety  
            expenditures as a result of these organizational changes.  The  
            author and the sponsor believe that reinstatement of the audit  
            will enhance public safety by ensuring that individuals who  
            are employed as railroad safety inspectors are dedicated full  
            time to performing those duties.

           Analysis Prepared by  :    Chuck Nicol / APPR. / (916) 319-2081