BILL ANALYSIS
------------------------------------------------------------
|SENATE RULES COMMITTEE | SB 476|
|Office of Senate Floor Analyses | |
|1020 N Street, Suite 524 | |
|(916) 445-6614 Fax: (916) | |
|327-4478 | |
------------------------------------------------------------
UNFINISHED BUSINESS
Bill No: SB 476
Author: Chesbro (D)
Amended: 6/29/99
Vote: 21
SENATE ENERGY, U.&C. COMMITTEE : 6-0, 4/27/99
AYES: Bowen, Hughes, Peace, Solis, Speier, Vasconcellos
NOT VOTING: Alarcon, Baca, Brulte, Kelley, Mountjoy
SENATE JUDICIARY COMMITTEE : 7-0, 5/18/99
AYES: Burton, Escutia, O'Connell, Peace, Sher, Wright,
Schiff
NOT VOTING: Haynes, Morrow
SENATE FLOOR : 27-9, 6/1/99
AYES: Baca, Bowen, Burton, Chesbro, Costa, Dunn, Escutia,
Figueroa, Hayden, Hughes, Johannessen, Johnston, Leslie,
McPherson, Morrow, Murray, O'Connell, Ortiz, Peace,
Perata, Polanco, Rainey, Schiff, Sher, Speier,
Vasconcellos, Wright
NOES: Brulte, Haynes, Johnson, Kelley, Knight, Lewis,
Monteith, Mountjoy, Poochigian
NOT VOTING: Alarcon, Alpert, Karnette, Solis
ASSEMBLY FLOOR : 51-24, 8/16/99 - See last page for vote
SUBJECT : Mobilehomes: liquified petroleum gas sales
SOURCE : Golden State Mobilehome Owners League
DIGEST : This bill would cap the price a moblehome park
CONTINUED
SB 476
Page
2
manager may charge mobilehome park residents for liquified
petroleum gas to 110 percent of the actual price paid, when
the residents can only purchase their gas from the park
management.
Assembly Amendments change the term "liquid propane butane"
to "liquified petroleum gas", and make technical changes.
ANALYSIS : Current law allows mobilehome parks to bill
residents separately for utility services if the rental
agreement does not include such services. Existing law
allows park management to require a resident wishing to
purchase liquified petroleum gas to make the purchase
solely from management at an unregulated price.
This bill limits the price that mobilehome park owners may
charge tenants for liquified petroleum gas if the park
owner does not permit the tenant to purchase his/her own
gas. The price which park owners may charge is capped at
110% of the actual price paid by the park owner.
The bill requires the mobilehome park management to post
the actual price paid by management for liquified petroleum
gas sold by it.
The bill expressly excludes recreational vehicles from its
provisions. The bill clarifies that it applies only to
mobilehome parks covered under the Mobilehome Residency
Law.
The bill clarifies that it will not affect the provisions
of law that allow the costs of services rendered to be
charged to tenants.
Comments
This bill addresses the issue of liquified petroleum gas
pricing by mobilehome parks whose tenants have no
alternative but to purchase gas from the park's propane
distribution system. A 1993 study by the California Public
Utilities Commission (CPUC) estimated that approximately
500 of the state's approximately 1,200 mobilehome parks
operated multi-customer systems where the residents can
only purchase gas from the park owner, creating an
SB 476
Page
3
effective monopoly. Liquified petroleum gas is to
mobilehomes as natural gas is to traditional homes, yet
while the retail price of natural gas is regulated, the
retail price of liquified gas is not. This bill is
intended to deal with this inconsistency in state policy.
The author doesn't believe that the sale of gas to captive
residents should be allowed to be a profit center for
mobilehome park owners. This bill limits that profit by
capping rates at 110% of the price paid by the park owner.
Out of the 10% margin, the park owner would presumably
cover the costs of operating and maintaining the system of
pipes and storage tanks which deliver the gas to the
mobilehomes. The 10% figure is not scientifically based,
but the author has apparently attempted to acquire actual
cost data from park owners without success. Without such
data it is not possible to determine a fair margin.
The Legislature has three times in the last ten years
passed bills to limit propane prices in mobilehome parks.
Bills that capped propane prices at 110% of the wholesale
price were passed by the Legislature and vetoed in 1989 and
1991. In 1998, AB 2016 (Brown), which capped the price of
propane at the price paid by the park management plus a
monthly charge to cover the cost of operating, maintaining,
and improving the distribution system, also passed the
Legislature and was vetoed.
FISCAL EFFECT : Appropriation: No Fiscal Com.: No
Local: No
SUPPORT : (Verified 8/16/99)
American Association of Retired Persons
Area Agency on Aging, Eureka
Santa Clara County Council on Aging
California Senior Legislature
El Dorado County Commission on Aging
Golden State Mobile Homeowners League
Western Center on Law and Poverty, Inc.
California Rural Legal Assistance Foundation
Numerous individuals
SB 476
Page
4
ARGUMENTS IN SUPPORT : The supporters of this bill argue
that it is necessary to prevent excessive charges for
liquified petroleum gas by mobilehome park owners. They
note that many residents of mobilehome parks are senior
citizens living on fixed incomes.
ASSEMBLY FLOOR :
AYES: Alquist, Aroner, Battin, Bock, Cardenas, Cardoza,
Cedillo, Corbett, Correa, Davis, Ducheny, Dutra,
Firebaugh, Florez, Gallegos, Granlund, Havice, Hertzberg,
Honda, House, Jackson, Keeley, Knox, Kuehl, Lempert,
Leonard, Longville, Lowenthal, Machado, Mazzoni, Migden,
Nakano, Papan, Reyes, Romero, Runner, Scott, Shelley,
Soto, Steinberg, Strom-Martin, Thompson, Thomson,
Torlakson, Washington, Wayne, Wesson, Wiggins, Wildman,
Wright, Villaraigosa
NOES: A anestad, Ackerman, Ashburn, Baldwin, Bates, Baugh,
Briggs, Campbell, Cox, Cunneen, Dickerson, Frusetta,
Kaloogian, Leach, Maddox, Maldonado, Margett, McClintock,
Olberg, Oller, Robert Pacheco, Pescetti, Strickland,
Zettel
NOT VOTING: Brewer, Calderon, Floyd, Rod Pacheco, Vincent
NC:sl 8/18/99 Senate Floor Analyses
SUPPORT/OPPOSITION: SEE ABOVE
**** END ****