Existing Systems - Orange County Transit District - Public Utilities - CA

Section § 40221

This section defines terms used in the chapter, specifically relating to transit systems in Orange County. 'Establish' covers a range of actions like building, acquiring, or altering transit systems but doesn't include just running or maintaining an existing one. An 'existing system' refers to any transit system, whether public or private, operating entirely or mostly in Orange County, and has been active since at least January 1, 1982.

As used in this chapter:

(a) “Establish” includes establish, construct, complete, acquire, extend, or reroute. It does not, however, include the maintenance and operation of any existing system acquired by the district.

(b) “Existing system” means any transit service or system of a publicly or privately owned public utility situated entirely within Orange County, or at least 75 percent of whose revenue vehicle miles for the preceding calendar year were operated within Orange County, and has been in operation since at least January 1, 1982.

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Section § 40222

Before a district can set up any new transit service or system that might take away customers or profits from an existing one, it must first notify the public utility that currently runs the existing system. This notice must detail the proposed transit service or system and specify when the district plans to start it.

Notwithstanding any other provision of this part, before the district may propose to establish any transit service or system which may at any time divert, lessen, or compete for the patronage or revenues of any existing system, the district shall give a written notice to the public utility which is operating the existing system. The written notice shall describe the transit service or system which the district proposes to establish and shall state the time within which the district proposes to establish the service or system.

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Section § 40222.5

This law states that a district cannot start or run a new service or system until it has bought the existing system or part it plans to use. Basically, they must complete the purchase first before doing anything new with it.

The district shall not establish the proposed service or system, or maintain and operate the service or system until it has completed the purchase of the existing system or any part thereof.

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Section § 40223

This law explains how the price is determined when buying an existing system or part of it. The price is based on what it would cost to build the system brand new, considering its current value as an ongoing business, minus any reduction in value due to aging, damage, or being outdated.

The purchase price to be paid for the existing system, or any portion thereof to be purchased, shall be the reproduction cost new, including going concern value, at the date upon which the district commences negotiations for the purchase of the existing system, or the portion of the existing system, less depreciation, including wear, tear, and obsolescence, if any.

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Section § 40223.5

This law section explains that a district and a public utility can agree on a price for purchasing an existing utility system. If they can't agree, they can choose to use arbitration, deciding together how arbitrators are selected and how the arbitration process will work. If there's no agreement on either of these methods, either party can go to court to have the purchase price determined, with legal action taking place in the county where the most valuable part of the system is located.

The district and the public utility operating the existing system may agree upon the purchase price or they may agree that the purchase price is to be established by arbitration and upon the method of naming arbitrators and the method of conducting such arbitration. If they do not, the purchase price may be fixed and judgment entered thereon in a suit brought either by the public utility or the district in the superior court in and for the county in which is located that portion of the existing system to be acquired by the district which has the highest value.

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Section § 40224

This section states that Section 851 does not apply to contracts involving the sale of an existing system or parts of it under this chapter. Additionally, the Public Utilities Commission does not have jurisdiction over these contracts or sales.

Section 851 does not apply to any contract for sale or sale of an existing system, or any portion thereof, pursuant to this chapter, and the Public Utilities Commission has no jurisdiction with respect thereto.

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