In Washington, a campaign to undermine California’s authority over driverless cars

Dec. 19, 2018 3 AM PT

Reporting from Washington — As autonomous-car companies unveil their test vehicles on city streets, they are also unleashing their lobbyists on Congress with an urgent mission: Keep California regulators at bay.

The prospect of California writing the rules of the driverless road does not sit well with auto firms. California’s outsized influence over car companies — most notably the state’s sway over air pollution and fuel economy rules — has been a source of consternation for the auto industry for decades. The regulatory muscle the state has used to force manufacturers to adopt new technologies is a long-running point of industry agitation.

Now, the state is moving to impose stringent safety and privacy regulations on autonomous vehicles. The companies have responded by championing a measure in Congress to force California and other states to yield rule-making authority to the Trump administration. The fight is playing out in a determined campaign to pass legislation backed by the industry in the final days of this Congress.

At stake are the rules that will guide what promises to be a revolution in transportation, as well as the balance of power between an industry-friendly administration in Washington and a more consumer-oriented government in the nation’s largest state.

“The state is already over-regulating this industry, and it is stifling innovation,” said Grayson Brulte, an industry consultant based in Beverly Hills. “This would override some of the state’s regulations and replace them with federal regulations…. We have to look at what is best for society, not what is best for a single state.”

Some influential lawmakers are hoping to slip the legislation into a must-pass spending bill before the current session of Congress comes to a close at the end of this week. While the clock seems likely to run out on the effort in this session, the industry almost certainly will take another run at it in the new year.

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California officials warn that the measure under consideration in the Senate threatens to idle pioneering regulations already approved in their state and others. In particular, the Senate bill, which has drawn some bipartisan backing, would jeopardize California’s first-in-the-nation safety rule that forces driverless firms to detail for the public every malfunction that has caused a test vehicle to be taken off the roads.

Opponents of the measure say it might also exempt driverless firms from the state’s new landmark privacy law, leaving passengers unable to opt out of having their movements tracked and data about their riding habits shared commercially. It could also ban state and local governments from adopting laws that California officials say will be crucial to safely adapting to the new technology.

“This technology is nowhere near where private companies would like us to think it is,” said Seleta Reynolds, general manager of the Los Angeles Department of Transportation. “These vehicles are years away from being able to operate in cities without a fair number of controls in place to reduce the amount of chaos they could cause.”

Yet the auto and tech industries are steadfast. “We keep pushing back against this plan in Washington to preempt our ability to protect the public good,” Reynolds said. “But it is the one main thing industry keeps fighting for.”

The National Assn. of City Transportation Officials, which Reynolds leads, has joined cities, state lawmakers and consumer rights groups in urging senators not to approve the pending bill, known as AV START, warning it would create “a national carte blanche for experimentation on public roadways, putting real people in the place of crash dummies.”

Lawmakers championing the bill say their goal is not to undermine California. They argue the anxiety is unwarranted.

Advisors to the lawmaker leading the push, Sen. John Thune (R-S.D.), who chairs the Senate Commerce Committee, say the bill does not target California’s existing rules for elimination. The measure would not prevent the state from forcing companies to obey its data privacy rules and report publicly when vehicles malfunction, they say.

They frame the proposal as merely bringing sanity to what they describe as a disorderly patchwork of driverless-vehicle regulations, in which the industry faces 36 different sets of rules in states that have adopted their own policies toward autonomous vehicles. The legislation would clarify that the federal government is responsible for vehicle safety standards, and states and local governments will maintain their traditional role over traffic and vehicle operation laws, backers say. That, they add, would give the administration the tools it needs to draft nationwide rules and provide industry the regulatory clarity it says is essential to accelerating innovation.

“The intention of our self-driving legislation has always been to preserve a dynamic where auto equipment is regulated by the federal government, and state and local officials set the rules of the road for driving and related services like insurance,” Thune said in an email. “We’ve made multiple edits to re-clarify this intention and stand ready to do more.”

The measure’s critics are unconvinced.

Rules for driverless vehicles are largely uncharted territory, and the legislation remains full of potential pitfalls for states that want to do more than Washington would do to hold companies accountable. Lawmakers opposed to Thune’s bill are concerned it would create a vacuum, banning state and local governments from imposing rules on the industry immediately, even with federal regulations unlikely to be drafted and approved for years.

“Congress needs to be absolutely sure we’re not interfering with local traffic laws,” Sen. Dianne Feinstein said in an email. Feinstein is among a group of senators demanding major changes in the bill.

“If self-driving cars are going to revolutionize transportation, states and cities shouldn’t be deprived of their ability to keep people safe during that transformation, especially since it could be decades before new federal safety standards are written,” she wrote.

State Sen. Hannah-Beth Jackson, a Democrat who chairs the state Senate’s Judiciary Committee, is skeptical of Thune’s assurances that his measure would protect California’s privacy rules. Members of Congress and industry representatives have resisted adding a provision explicitly guaranteeing the privacy rules would apply to autonomous vehicles.

“These cars have extraordinary information-collecting opportunities, and the industry wants to be able to use that data without restriction,” she said.

The existence of multiple state rules is a constant complaint of industry officials, who want to build fleets that can glide across state lines. The Alliance of Automobile Manufacturers, which represents major car companies, is urging lawmakers to immediately pass the Thune measure, arguing it “would protect against an unworkable patchwork of state and federal laws and regulations that could stifle innovation, job growth, and the development of safety technologies.”

Back in California, some analysts compare this pivotal moment for the auto industry to 1970, when Congress gave the smog-choked state special authority under the Clean Air Act to impose tailpipe emissions targets stricter than federal standards. The state used that authority to push automakers to develop ever more efficient fleets.

Only now, they say, the push in Congress is to inhibit the state.

“If California had to deal with these kinds of preemptions in the Clean Air Act, we’d all be breathing dirtier air right now,” said Steven Shladover, a UC Berkeley research engineer who has advised the state on autonomous vehicle rules.

“It’s a race to the bottom…. The industry wants the most minimal, meaningless level of regulation and for it to be imposed everywhere.”

The fight over what sort of rules to impose inevitably centers on California, Jackson said.

“Because of the size and number of vehicles sold here, we are ground zero for the auto industry in terms of the requirements it must follow,” she said. “As goes California, so goes the rest of the country by virtue of our market share. The auto industry does not want to be regulated by us in any way, shape or form.”

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