Regulations

California Operators Advance Core Messages

Martin Romjue
Posted on February 19, 2019
Greater California Livery Association annual Legislative Day participants: Alaric Sales, Robert Gaskill, Mark Stewart, Don Mahnke, Mo Garkani, Harry Dhillon, Thomas Buck, Carlos Garcia, Darren Croasdale, and David Kinney. (LCT photos by Martin Romjue)

Greater California Livery Association annual Legislative Day participants: Alaric Sales, Robert Gaskill, Mark Stewart, Don Mahnke, Mo Garkani, Harry Dhillon, Thomas Buck, Carlos Garcia, Darren Croasdale, and David Kinney. (LCT photos by Martin Romjue)

SACRAMENTO, Calif. — It was almost appropriate for a group of California operators to be hit with torrential winter rains last week as they visited the State Capitol to sound out legislators on ways to improve the ground transportation industry.

Although the strong Pacific storm was a nuisance, if state government leaders and politicians embraced the three-fold agenda of the Greater California Livery Association, the effects would clean out and clarify a lot of the confusion now evident when regulating transportation network companies (TNCs) such as Uber and Lyft.

GCLA board director and legislative leader David Kinney briefs participants before the day's sessions.

GCLA board director and legislative leader David Kinney briefs participants before the day's sessions.

21 GCLA leaders and members visited with state political players and staff Feb. 13, covering 24 Senate and Assembly offices. This year, the small teams organized by GCLA lobbyist Gregg Cook got more face time with actual legislators, such as Sen. Bob Archuleta, D-32nd District in the Los Angeles region, and Sen. John M. W. Moorlach, R-37th District in Orange County.

One highlight was a morning Q&A session with Assemblywoman Lorena Gonzalez-Fletcher, D-80th District, who chairs the powerful Assembly Appropriations Committee. The GCLA contingent also heard from several state agency managers and legislative staff who contribute to legislative outcomes.

The three measures the GCLA advocates would in tandem deliver the complementary results of boosting public safety while promoting the long-sought industry goal of regulatory parity between TNCs and TCPs (transportation charter permit) carriers. TCP is the official state designation for commercial private transportation services such as limousines, chartered motorcoaches, and taxis.

Nate Solov, chief of staff for Sen. Jerry Hill, D-13th District in the San Mateo County area.

Nate Solov, chief of staff for Sen. Jerry Hill, D-13th District in the San Mateo County area.

NO. 1: Testing TNC Drivers For Drugs

The GCLA has joined a growing wave of interest groups, enforcement agencies, and local governments calling for the drug and alcohol testing of TNC drivers. As the law now stands, TCP drivers, school bus drivers, and municipal bus drivers must be drug-tested, while TNC drivers do not.

The need for drug testing has become more urgent with the widespread legalization of cannabis, including in California, and the growing practice of some parents to use TNCs to transport their children. The GCLA presented National Highway Traffic Safety Administration statistics showing the percentage of all traffic deaths that are marijuana related rose from 14.76% in 2013, when a handful of states began legalizing the drug, to 21.02% just two years later. Drug use in the U.S. population ages 20-40 ranges from one out of five (20) to one out of 12 (40).

GCLA leaders heard from Nate Solov, chief of staff for Sen. Jerry Hill, D-13th District in the San Mateo County area, on how the Senator is looking at two possible bills that would mandate more drug testing and also possibly regulate the use of cannabis in limousines and party buses.

“We want to make sure safety standards are being met and will work with you on any issues you may have,” Solov told GCLA members.

Cook, the head of the Sacramento-based lobbying firm Government Affairs Consulting, told Solov “far too many parents are putting their kids in Uber and Lyft vehicles without (the TNCs) making sure the driver has passed a drug and alcohol test.”

California Assemblywoman Lorena Gonzalez-Fletcher, D-80th District, chair of the Assembly Appropriations Committee, held a Q&A with GCLA members.

California Assemblywoman Lorena Gonzalez-Fletcher, D-80th District, chair of the Assembly Appropriations Committee, held a Q&A with GCLA members.

NO. 2: Fair Wages, Level Labor

A pivotal piece of legislation that could go the furthest in leveling the labor situation between TNCs and TCPs is Assembly Bill No. 5, sponsored by Gonzalez-Fletcher.

The bill would put into state law provisions of a State Supreme Court ruling in a major independent contractor case on April 30. The landmark case, Dynamex Operations West Inc. v. Superior Court of Los Angeles, placed more burdens on businesses and entities to establish they have properly classified workers as independent contractors. The decision embraced a standard that presumes all workers are employees. Employers must prove: 1) Contractors are free from employer control, 2) outside the regular scope of the business, and 3) independently established in that trade, according to the California Labor Federation.

“When the [verdict] came out, we finally had a unanimous bipartisan decision on the rules about classifying workers,” Gonzalez-Fletcher said.

The bill would codify into law the requirements to pay unemployment insurance, workers’ compensation, sick leave, and wages, among other labor-related rules followed by employers in the state.

The committee chair took apart the primary TNC argument AB 5 would hurt their business model: “I have not heard what makes the TNCs special. Outlawing child labor was not good for the business model of sweatshops.”

By not paying into the employee protections and benefits and the social safety net, the TNCs are getting a free ride, Gonzalez-Fletcher said. “We are subsidizing their workforce. We cannot subsidize Silicon Valley. They are doing just fine. It’s not fair to taxpayers.”

In their discussions with GCLA members, some legislators and staff were concerned how the bill would clarify how its provisions would affect industries that heavily depend on contract labor, such as the entertainment industry.

Gonzalez-Fletcher addressed that concern earlier in her session when she told the GCLA legislators would look at exemptions for traditionally independent business sectors oriented to professional licenses. “We have to see where they fit into the law. If we rewrite the rules, we have to do so for everybody.”

NO. 3: Funding More Enforcement

On the trade group’s third agenda item, the issue revolves around more money–but not finding it, as is often the case when constituents seek government help. TCP carriers across the state for years have been paying into a California Public Utilities Commission enforcement fund with their quarterly PUCTRA (PUC Transportation Reimbursement Account) fees. The CPUC regulates all chauffeured/limo and chartered commercial transportation in California.

While the GCLA scored a major administrative victory recently by getting those fees suspended, the CPUC has yet to spend the accumulated $50 million on additional enforcement officers who could deter illegal operators that avoid all licensing and oversight and thereby competitively undercut legal, licensed operators.

The CPUC had authorized hiring 12 additional officers, and proceeded to make six positions available, but due to low salaries and low unemployment, has not been able to hire anyone. Throughout the day’s sessions, GCLA operators urged legislators, staff, and officials to lean on the CPUC to loosen enough funds for stronger enforcement. The GCLA also seeks a boost for clerical and administrative support at the CPUC so the agency can actually answer calls from operators instead of sending them into phone-tree voice mails.

During a brief morning session, Ronda Pascal, a policy advisor to Gov. Gavin Newsom, and Melanie Perron, a state transportation analyst, said one of the Governor’s top priorities is to deploy a strike team to look at how the Department of Motor Vehicles could become more customer-friendly and improve its operations.

Sarah Smith, a consultant to the Senate Energy, Utilities and Communication Committe, speaks to GCLA members in one of many visits and appointments set up by GCLA lobbyist Gregg Cook.

Sarah Smith, a consultant to the Senate Energy, Utilities and Communication Committe, speaks to GCLA members in one of many visits and appointments set up by GCLA lobbyist Gregg Cook.

Keep At It

As is always the case with lobbying, no promises are ever made openly during a visit, but GCLA operators who debriefed with Cook afterward generally agreed their messages were focused, and most importantly, directly heard and noted.

Legislative outcomes often culminate a labyrinth of committee processes and interactions with stage agencies and influencers in between. In fact, a cliché overheard during the event speaks to a core rule of politics on how “the squeaky wheel gets the grease.”

When one operator asked during a morning session what the GCLA could better do to get results, the speaker, Sarah Smith, a consultant to the Senate Energy, Utilities and Communication Committee which oversees the CPUC, encouraged them to never give up, even if a legislative goal takes 10 years or more.

“Be persistent and stay engaged. Sometimes it takes a while to get resolution on things,” Smith told operators assembled in a first floor Senate hearing room. “You will chip away at the issues. It will become apparent to the Governor’s office and other officials there is a problem that needs to be addressed.”

Related Topics: California operators, California Public Utilities Commission, David Kinney, driver behavior, drug testing, employee vs independent contractor, Greater California Livery Association, Gregg Cook, illegal operators, independent contractor issues, industry leaders, industry politics, labor laws, legislation, limo associations, lobbying, Lyft, Mark Stewart, regulatory enforcement, state regulations, TNCs, Uber

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