An act to amend Section 5374 of, and to add Section 5444 to, the Public Utilities Code, and to amend Section 1808.1 of the Vehicle Code, relating to transportation.

The people of the State of California do enact as follows:


SECTION 1.
Section 5374 of the Public Utilities Code is amended to read:
5374.
(a) (1) Before a permit or certificate is issued or renewed, the commission shall require the applicant to establish reasonable fitness and financial responsibility to initiate and conduct or continue to conduct the proposed or existing transportation services. The commission shall not issue or renew a permit or certificate pursuant to this chapter unless the applicant meets all of the following requirements:
(A) It is financially and organizationally capable of conducting an operation that complies with the rules and regulations of the Department of the California Highway Patrol governing highway safety.
(B) It is committed to observing the hours of service regulations of state and, where applicable, federal law, for all persons, whether employees or subcarriers, operating vehicles in transportation for compensation under the certificate.
(C) It has a preventive maintenance program in effect for its vehicles used in transportation for compensation that conforms to regulations of the Department of the California Highway Patrol in Title 13 of the California Code of Regulations.
(D) It participates in the pull-notice system pursuant to Section 1808.1 of the Vehicle Code to regularly check the driving records of all persons, whether employees or subcarriers, operating vehicles used in transportation for compensation.
(E) It has a safety education and training program in effect for all employees or subcarriers operating vehicles used in transportation for compensation.
(F) It will maintain its vehicles used in transportation for compensation in a safe operating condition and in compliance with the Vehicle Code and with regulations contained in Title 13 of the California Code of Regulations relative to motor vehicle safety.
(G) It has filed with the commission the certificate of workers’ compensation insurance coverage or statement required by Section 5378.1.
(H) It has provided the commission an address of an office or terminal where documents supporting the factual matters specified in the showing required by this subdivision may be inspected by the commission and the Department of the California Highway Patrol.
(I) It provides for a mandatory controlled substance and alcohol testing certification program as adopted by the commission pursuant to Section 1032.1.
(J) Subparagraphs (C), (F), and (H) do not apply to a charter-party carrier of passengers engaged in the provision of a hired driver service when a rented motor vehicle is being operated by the hired driver.
(2) With respect to subparagraphs (B) and (F) of paragraph (1), the commission may base a finding on a certification by the commission that an applicant has filed, with the commission, a sworn declaration of ability to comply and intent to comply.
(3) The commission may require, as a precondition to the issuance of a permit or certificate, the procurement of a performance bond sufficient to facilitate the collection of fines, penalties, and restitution related to enforcement actions that can be taken against the applicant.
(b) In addition to the requirements in subdivision (a), charter-party carriers shall meet all other state and, where applicable, federal regulations as prescribed.
(c) The commission may delegate to its executive director or that executive director’s designee the authority to issue, renew, or authorize the transfer of, charter-party carrier permits or certificates and to make the findings specified in subdivision (a) that are necessary to that delegated authority.
SEC. 2.
Section 5444 is added to the Public Utilities Code, to read:
5444.
(a) A transportation network company shall do all of the following:
(1) Participate in a pull-notice system pursuant to Section 1808.1 of the Vehicle Code to regularly check the driving records of all participating drivers.
(2) Provide for a mandatory controlled substance and alcohol testing certification program as adopted by the commission pursuant to Section 1032.1.
(3) Register any vehicle used in the transportation of passengers for compensation with the commission and display on the vehicle
a suitable decal with
an identifying symbol
issued
prescribed
by the
commission.
commission pursuant to Section 5385.
(b) Drivers hired or initially retained by a transportation network company on or after January 1, 2016, shall be subject to mandatory drug and alcohol testing prior to employment or retention. Drivers hired or initially retained before January 1, 2016, shall complete a drug and alcohol test before January 1, 2017.
SEC. 3.
Section 1808.1 of the Vehicle Code is amended to read:
1808.1.
(a) The prospective employer of a driver who drives a vehicle specified in subdivision (k) shall obtain a report showing the driver’s current public record as recorded by the department. For purposes of this subdivision, a report is current if it was issued less than 30 days prior to the date the employer employs the driver. The report shall be reviewed, signed, and dated by the employer and maintained at the employer’s place of business until receipt of the pull-notice system report pursuant to subdivisions (b) and (c). These reports shall be presented upon request to an authorized representative of the Department of the California Highway Patrol during regular business hours.
(b) The employer of a driver who drives a vehicle specified in subdivision (k) shall participate in a pull-notice system, which is a process for the purpose of providing the employer with a report showing the driver’s current public record as recorded by the department, and any subsequent convictions, failures to appear, accidents, driver’s license suspensions, driver’s license revocations, or any other actions taken against the driving privilege or certificate, added to the driver’s record while the employer’s notification request remains valid and uncanceled. As used in this section, participation in the pull-notice system means obtaining a requester code and enrolling all employed drivers who drive a vehicle specified in subdivision (k) under that requester code.
(c) The employer of a driver of a vehicle specified in subdivision (k) shall, additionally, obtain a periodic report from the department at least every 12 months. The employer shall verify that each employee’s driver’s license has not been suspended or revoked, the employee’s traffic violation point count, and whether the employee has been convicted of a violation of Section 23152 or 23153. The report shall be signed and dated by the employer and maintained at the employer’s principal place of business. The report shall be presented upon demand to an authorized representative of the Department of the California Highway Patrol during regular business hours.
(d) Upon the termination of a driver’s employment, the employer shall notify the department to discontinue the driver’s enrollment in the pull-notice system.
(e) For the purposes of the pull-notice system and periodic report process required by subdivisions (b) and (c), an owner, other than an owner-operator as defined in Section 34624, and an employer who drives a vehicle described in subdivision (k) shall be enrolled as if he or she were an employee. A family member and a volunteer driver who drives a vehicle described in subdivision (k) shall also be enrolled as if he or she were an employee.
(f) An employer who, after receiving a driving record pursuant to this section, employs or continues to employ as a driver a person against whom a disqualifying action has been taken regarding his or her driving privilege or required driver’s certificate, is guilty of a public offense, and upon conviction thereof, shall be punished by confinement in a county jail for not more than six months, by a fine of not more than one thousand dollars ($1,000), or by both that confinement and fine.
(g) As part of its inspection of bus maintenance facilities and terminals required at least once every 13 months pursuant to subdivision (c) of Section 34501, the Department of the California Highway Patrol shall determine whether each transit operator, as defined in Section 99210 of the Public Utilities Code, is then in compliance with this section and Section 12804.6, and shall certify each operator found to be in compliance. Funds shall not be allocated pursuant to Chapter 4 (commencing with Section 99200) of Part 11 of Division 10 of the Public Utilities Code to a transit operator that the Department of the California Highway Patrol has not certified pursuant to this section.
(h) (1) A request to participate in the pull-notice system established by this section shall be accompanied by a fee determined by the department to be sufficient to defray the entire actual cost to the department for the notification service. For the receipt of subsequent reports, the employer shall also be charged a fee established by the department pursuant to Section 1811. An employer who qualifies pursuant to Section 1812 shall be exempt from any fee required pursuant to this section. Failure to pay the fee shall result in automatic cancellation of the employer’s participation in the notification services.
(2) A regularly organized fire department, having official recognition of the city, county, city and county, or district in which the department is located, shall participate in the pull-notice program and shall not be subject to the fee established pursuant to this subdivision.
(3) The Board of Pilot Commissioners for Monterey Bay and the Bays of San Francisco, San Pablo, and Suisun, and its port agent shall participate in the pull-notice system established by this section, subject to Section 1178.5 of the Harbors and Navigation Code, and shall not be subject to the fees established pursuant to this subdivision.
(i) The department, as soon as feasible, may establish an automatic procedure to provide the periodic reports to an employer by mail or via an electronic delivery method, as required by subdivision (c), on a regular basis without the need for individual requests.
(j) (1) The employer of a driver who is employed as a casual driver is not required to enter that driver’s name in the pull-notice system, as otherwise required by subdivision (a). However, the employer of a casual driver shall be in possession of a report of the driver’s current public record as recorded by the department, prior to allowing a casual driver to drive a vehicle specified in subdivision (k). A report is current if it was issued less than six months prior to the date the employer employs the driver.
(2) For the purposes of this subdivision, a driver is employed as a casual driver when the employer has employed the driver less than 30 days during the preceding six months. “Casual driver” does not include a driver who operates a vehicle that requires a passenger transportation endorsement.
(k) This section applies to a vehicle for the operation of which the driver is required to have a class A or class B driver’s license, a class C license with a hazardous materials endorsement, a class C license issued pursuant to Section 12814.7, or a certificate issued pursuant to Section 12517, 12519, 12520, 12523, 12523.5, or 12527, or a passenger vehicle having a seating capacity of not more than 10 persons, including the driver, operated for compensation by a charter-party carrier of passengers, transportation network company, or passenger stage corporation pursuant to a certificate of public convenience and necessity or a permit issued by the Public Utilities Commission.
(l) (1) For purposes of this section, the term “employer” or “prospective employer” includes a transportation network company whose permit or certificate, including any renewal of that permit or certificate, is subject to the requirements of Article 7 (commencing with Section 5430) of Chapter 8 of Division 2 of the Public Utilities Code.
(2) This section shall not be construed to change the definition of “employer,” “employee,” or “independent contractor” for any other purpose.
(m) A motor carrier who contracts with a person to drive a vehicle described in subdivision (k) that is owned by, or leased to, that motor carrier, shall be subject to subdivisions (a), (b), (c), (d), (f), (j), (k), and (l) and the employer obligations in those subdivisions.
(n) Reports issued pursuant to this section, but only those for a driver of a taxicab engaged in transportation services as described in subdivision (a) of Section 53075.5 of the Government Code, shall be presented upon request, during regular business hours, to an authorized representative of the administrative agency responsible for issuing permits to taxicab transportation services pursuant to Section 53075.5 of the Government Code.
SEC. 4.
No reimbursement is required by this act pursuant to Section 6 of Article XIII B of the California Constitution because the only costs that may be incurred by a local agency or school district will be incurred because this act creates a new crime or infraction, eliminates a crime or infraction, or changes the penalty for a crime or infraction, within the meaning of Section 17556 of the Government Code, or changes the definition of a crime within the meaning of Section 6 of Article XIII B of the California Constitution.

Summary: The Passenger Charter-party Carriers’ Act, with certain exceptions, prohibits a charter-party carrier of passengers from engaging in transportation services subject to regulation by the Public Utilities Commission without obtaining a specified certificate or permit, as appropriate, from the commission, and imposes various other requirements. Existing law requires, as a condition to obtaining a certificate or permit, that the applicant, among other things, participate in a program to regularly check the driving records of all vehicle operators and provide a mandatory controlled substance and alcohol testing certification program. A violation of the act is generally a misdemeanor. Existing law defines a transportation network company as an organization, whether a corporation, partnership, sole proprietor, or other form, operating in California that provides prearranged transportation services for compensation using an online-enabled platform to connect passengers with drivers using their personal vehicles.
This bill would prohibit the commission from issuing or renewing a permit or certificate to a charter-party carrier of passengers unless the applicant, in addition to existing requirements, participates in the Department of Motor
Vehicles
Vehicles
’
pull-notice system. This bill would specifically require a transportation network company to comply with this provision and to provide for a mandatory controlled substance and alcohol testing certification program. The bill would also require a transportation network company to register any vehicle used in the transportation of passengers for compensation with the commission and display an identifying
decal issued
symbol prescribed
by the commission on the vehicle.
The bill would require that drivers hired or initially retained by a transportation network company on or after January 1, 2016, be subject to mandatory drug and alcohol testing prior to employment or retention and that drivers hired or initially retained before January 1, 2016, complete a drug and alcohol test before January 1, 2017.
Because a violation of these provisions would be a crime, the bill would impose a state-mandated local program.
The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.
This bill would provide that no reimbursement is required by this act for a specified reason.