BILL ANALYSIS                                                                                                                                                                                                    



                                                                  SB 1612
                                                                  Page  1

          SENATE THIRD READING
          SB 1612 (Chesbro)
          As Amended May 15, 2000
          Majority vote 

           SENATE VOTE  :35-1  
           
           HOUSING             9-0                                         
           
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          |Ayes:|Lowenthal, House, Aroner, |     |                          |
          |     |Dutra, Knox, Mazzoni,     |     |                          |
          |     |Runner, Torlakson,        |     |                          |
          |     |Wildman                   |     |                          |
          |-----+--------------------------+-----+--------------------------|
          |     |                          |     |                          |
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          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)).  








                                                                  SB 1612
                                                                  Page  2


           FISCAL EFFECT  :  Unknown

           COMMENTS  :  Mobilehome owners use liquefied petroleum gas, also  
          known as propane, to heat their homes.  Although it serves the  
          same 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% 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.
           
           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 Chapter 326 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.


           Analysis Prepared by :  Chereesse Thymes / H. & C.D. / (916)  
          319-2085 




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