Existing Systems - Santa Cruz Metropolitan Transit District - Public Utilities - CA

Section § 98300

This section of the law defines terms used in the chapter. 'Establish' refers to various actions like creating, constructing, or expanding a system, but does not include running or maintaining an already existing system. An 'existing system' is defined as any transit service or utility that operates completely within a district or has 75% of its revenue vehicle miles within the district from the previous year.

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 by the district.

(b) “Existing system” means any transit service or system of a publicly or privately owned public utility situated entirely within the district or at least 75 percent of whose revenue vehicle miles for the preceding calendar year were operated within the district.

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Section § 98301

This law requires that before a district starts a new transit service that might compete with an existing one, they must notify the current operator. The notice has to include details about the new service and when it is planned to start.

Notwithstanding any other provision of this part, before the district may 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 such service or system.

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Section § 98302

Before a district can start or run a new bus service or system, it must first try to buy any existing buses or facilities that it will need. This means making an offer to purchase these resources, and either having that offer rejected or completing the purchase before moving forward with the new service.

The district shall not establish the proposed service or system, or maintain and operate the service or system until it has offered to purchase the buses and such other facilities of the existing system as it will have need of and use for, and such offer has either been rejected or the purchase completed.

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Section § 98303

This law states that when a district wants to buy an existing transportation system or part of it, the price they pay should be the fair market value of the buses and other facilities at the time they start negotiating for the purchase.

The purchase price to be paid for the existing system, or that part thereof which the district desires to purchase, shall be the reasonable market value of the buses and other facilities of the existing system on the date that the district commences negotiations for such purchase.

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Section § 98304

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 § 98305

This law states that for transactions involving the sale of an existing utility system or parts of it under this chapter, a certain rule (Section 851) doesn't apply. Additionally, the Public Utilities Commission doesn't have any control over these deals.

Section 851 of the Public Utilities Code 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 shall have no jurisdiction with respect thereto.

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