California Adopts Intrastate Leasing Regulations

Effective as of November 11, 2010, the California Highway Patrol has adopted regulations affecting motor carriers usinig equipment they do not own. The language closely mirrors the federal leasing regulations found at 49 CFR 376 ("Lease and Interchange of Vehicles" to Title 13). Under the new California regulations, all intrastate carriers using owner-operators on a non-temporary basis will have a new regulatory obligation, and CHP may now enforce the provisions of CFR 376 "Lease and Interchange of Vehicles" on interstate carriers. This includes the authority to examine lease agreements in order to determine which entity (overlying motor carrier or underlying independent contractor) is responsible for vehicle safety and maintenance during BIT inspections.

Note that while they are effective now, subsection (g) of the regulations provides for a transition period:

“For those business entities which have engaged in some sort of vehicle leasing relationship enacted prior to the filing of these regulations, the terms of these regulations will be met no later than June 30, 2011.”

Cal. Admin. Code Tit. 13, § 1235.7(g) (Westlaw 2010).