TRANSPORTATION LAW: Utilities Commission Poised to Transfer Four Essential Functions to Other Agencies


On July 1, 2018, four transportation-related functions currently within the purview of the California Public Utilities Commission (“CPUC”) will be transferred to other agencies or jurisdictions, pursuant to California Senate Bill 19, which was penned by California State Senator Jerry Hill (D), passed by the California Legislature, and approved by Governor Jerry Brown in late 2017. Under existing law, the CPUC has jurisdiction over all public utilities and has certain general powers over all public utilities and common carriers, subject to control by the Legislature. The new law is in response to a growing concern that the CPUC is spread too thin and handling too many varied areas, including but not limited to, railroads, passenger charters, common carriers of passengers, Transportation Network Companies (“TNC”), such as Lyft and Uber, and electric and water utilities.

Specifically, the new law terminates the CPUC’s regulatory authority over (1) household goods carriers (roughly 1000+ licenses), (2) vessels for hire (roughly 260+ licenses), (3) private carriers of passengers (roughly 1300+ registered), and (4) commercial air operators (roughly 100+ licenses).

The CPUC’s regulatory authority over household goods carriers (e.g., moving companies) will be transferred to a new division within the Household Movers Fund, which is part of the Bureau of Electronic and Appliance Repair, Home Furnishings, and Thermal Insulation (“BEARHFTI”) within the Department of Consumer Affairs (“DCA”). Regulatory authority over vessels for hire (e.g., boats used for sight-seeing or fishing) will be transferred to the Division of Boating and Waterways within Department of Parks and Recreation (“DPR”) to handle oversight of liability insurance. Regulatory authority over private carriers of passengers (e.g., private buses, such as those operated by churches or camps) will go to the Department of Motor Vehicles (“DMV”) to handle registration, insurance, violations and suspensions and filing fees. And finally, regulation of commercial air operators (e.g., chartered intrastate flights or flight schools) will be under the jurisdiction of cities and counties for the purposes of licensing and demonstrating proof of required liability insurance.

Significantly, the new law does not transfer the CPUC’s oversight of TNCs, such as Lyft and Uber, even though these functions more closely relate to taxis and are commonly regulated at the local level in other states and countries. Other functions that remain with the CPUC include other charter-party carriers and passenger stage carriers, including limos and buses, common carriers, such as ferries, and railroads.

While the full effect of this new law on transportation-related carriers is unknown, the hope is that the transfer of regulatory power away from the CPUC will create efficiencies and improve the public's interactions and customer service with the government, according to the Brown Administration.

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