BILL ANALYSIS                                                                                                                                                                                                    



                                                                  AB 2591
                                                                  Page  1

          ASSEMBLY THIRD READING
          AB 2591 (Leno)
          As Amended May 5, 2004
          Majority vote 

           LOCAL GOVERNMENT    9-0         TRANSPORTATION      8-1         
           
           ----------------------------------------------------------------- 
          |Ayes:|Salinas, Lieber, Daucher, |Ayes:|Oropeza, Houston, Bates,  |
          |     |Garcia,                   |     |Chan, Firebaugh, Pavley,  |
          |     |La Suer, Leno, Mullin,    |     |Salinas, Simitian         |
          |     |Steinberg, Diaz           |     |                          |
          |-----+--------------------------+-----+--------------------------|
          |     |                          |Nays:|Mountjoy                  |
          |     |                          |     |                          |
           ----------------------------------------------------------------- 
           
          SUMMARY  :  Strengthens the enforcement authority of local  
          governments in the regulation of charter-party carriers.   
          Specifically,  this bill  :  

          1)Authorizes a city, county, or city and county to impose  
            reasonable rules for the inspection of waybills of  
            charter-party carriers of passengers operating within the  
            jurisdiction of that local government.

          2)Specifies that the operation of a charter-party carrier of  
            passengers without a valid permit or operating authority  
            constitutes a public nuisance.

          3)Authorizes local law enforcement agencies, at the request of  
            the California Public Utilities Commission (CPUC), the  
            Attorney General, district attorney, city attorney, or county  
            counsel, to impound charter-party carrier vehicles being used  
            in a manner constituting a public nuisance for up to 72 hours.

           EXISTING LAW  :

          1)Authorizes, under the Charter-Party Carriers' Act (Act), CPUC  
            to issue operating authority and to regulate every  
            charter-party carrier of passengers, including limousines for  
            hire, that operates in the state.

          2)Authorizes a city, county, or city and county to adopt and  
            enforce reasonable rules and regulations pertaining to  








                                                                  AB 2591
                                                                  Page  2

            operations within its boundaries for any charter-party carrier  
            domiciled or maintaining a business office within that city,  
            county, or city and county.

          3)Prohibits a charter-party carrier from engaging in taxicab  
            transportation service licensed and regulated by a city or  
            county.

          4)Prohibits local governments from adopting license, permit,  
            fee, and other requirements on charter-party carriers  
            operating a limousine.

           FISCAL EFFECT  :  Unknown

           COMMENTS  :  The author has introduced this bill in an effort to  
          address problems on the local level with the regulation of  
          limousine operators.  Charter-party carriers, including  
          limousines, are passenger carriers who provide prearranged  
          transportation service within the state.  The Act, enacted in  
          the early 1960s, establishes CPUC as a regulatory body that  
          issues permits for this type of passenger carrier operation, and  
          establishes financial responsibility criteria, rate criteria,  
          and other operating requirements.  According to the author and  
          proponents of this bill, CPUC has been less than effective in  
          discharging its responsibilities.

          In response to allegations of the proliferation of renegade or  
          bandit limousine operators acting illegally as taxicabs, the  
          author wants to strengthen local governments' enforcement  
          authority in the regulation of charter-party carriers acting as  
          limousines.  This bill authorizes a local government to inspect  
          charter-party carrier waybills, which provide proof that  
          passenger rides are prearranged, and to impound the vehicles of  
          illegal operators.  Existing law authorizes local governments to  
          adopt and enforce any reasonable rules and regulations  
          pertaining to the operation of charter-party carriers within its  
          boundaries.

          The author and supporters contend that the current system of  
          regulation and enforcement of charter-party carriers is  
          inadequate and ineffective.  The taxicab and limousine  
          industries have both been faced with a proliferation of illegal  
          operators who fail to get CPUC operating authority or proper  
          insurance, and undercut the rates of legitimate operators.   
          Illegal operators do not follow basic safety and insurance  








                                                                  AB 2591
                                                                  Page  3

          regulations required by CPUC, do not pay for the state  
          regulation of limousines, and pose a variety of hazards to  
          passengers and other drivers.  Proponents contend that this bill  
          will help control the longstanding illegal and unfair practices  
          of limousine drivers who operate as taxicabs by not adhering to  
          the requirement that their services have been prearranged.   
          Supporters assert that limousines have been stealing fares from  
          taxicabs from hotels, airports, and increasingly while customers  
          are hailing off the street.  The author and supporters note that  
          CPUC lacks the resources or personnel to do more than minimal  
          enforcement, and that local governments' efforts have been  
          largely ineffective due to the inadequacy of existing  
          regulations.  They contend that this bill will enhance public  
          safety and confidence, mitigate the economic harm of illegal  
          activities, and reduce the regulatory burden on the CPUC. 

          The limousine industry supports increased enforcement efforts,  
          since illegal operators affect their business as well.  Further  
          amendments are expected to enhance the fines and penalties for  
          illegal operation of charter-party carriers and to clarify the  
          contents of waybills to ensure that limousines are operating on  
          a prearranged basis.


           Analysis Prepared by  :    Mark McKenzie / L. GOV. / (916)  
          319-3958 
                                                                FN: 0005155