BILL ANALYSIS SB 1612 Page 1 Date of Hearing: June 28, 2000 ASSEMBLY COMMITTEE ON HOUSING AND COMMUNITY DEVELOPMENT Alan Lowenthal, Chair SB 1612 (Chesbro) - As Amended: May 15, 2000 SENATE VOTE : 35-1 SUBJECT : Mobilehome parks: liquefied petroleum gas SUMMARY : Expands the current statutory limitation on the price that mobilehome park owners may charge tenants for liquefied petroleum gas to cases where laws or regulations prohibit tenants from installing their own propane tanks. Specifically, this bill : 1)Applies provisions of existing law that limit the price that mobilehome park owners may charge tenants for liquefied petroleum gas to 110% of the purchase price paid in parks where federal, state, or local laws prohibit tenants from installing their own gas supply tanks. 2)Requires park management to post a sign in the park that indicates the price paid by management for the gas in parks where federal, state, or local laws prohibit tenants from installing their own gas supply tanks. EXISTING LAW 1)Prohibits the management of a mobilehome park from charging park residents more than 110% of the actual price it paid for liquefied petroleum gas, if the management of the park does not permit residents to purchase gas from a source other than the park management (Civil Code Section 798.44(a)). 2)Requires the management of a mobilehome park to post the actual price paid by the management for liquefied petroleum gas that it sells (Civil Code Section 798.44(b)). FISCAL EFFECT : Unknown COMMENTS : Mobilehome owners use liquefied petroleum gas, also known as propane, to heat their homes. Although it serves the same SB 1612 Page 2 purpose as natural gas used in traditional homes, the retail price of natural gas is regulated but the retail price of propane is not. In 1993, the California Public Utilities Commission estimated that about 40 percent of the state's approximately 1,200 mobilehome parks operated multi-customer heating systems, allowing residents to purchase propane only from the park owner. Last year, the Legislature passed SB 476 (Chesbro), Chapter 326, Statutes of 1999 which capped the price that mobilehome park management may charge residents at 110% of the purchase price. The goal of the legislation was to protect tenants from monopoly prices because they could only purchase propane from the park management. The law exempts parks where tenants are allowed to purchase propane from alternative sources because competition would keep prices down. Arguments in support: The author says that there is a loophole in the existing law that allows for the sale of liquefied petroleum gas at a price higher than 110% in cases where federal, state, and local laws prohibit tenants from installing their own propane tanks. The author says that since SB 476 passed last year, some park owners have posted notices stating that residents may purchase liquefied petroleum gas from other sources, however, because of state and local laws requiring setbacks, these residents are not allowed to have their own petroleum gas tanks. REGISTERED SUPPORT / OPPOSITION : Support Golden State Mobilehome Owners League Opposition None on file Analysis Prepared by : Chereesse Thymes / H. & C.D. / (916)319-2085