By the end of the year, the Department of Motor Vehicles must write rules to regulate cars that rely on computers - not the owner - to do the driving.
That process began Tuesday, when the DMV held an initial public hearing in Sacramento to puzzle over how to regulate the vehicles that haven't been fully developed yet.
Among the complex questions officials sought to unravel:
How will the state know the cars are safe?
Does a driver even need to be behind the wheel?
Can manufacturers mine data from onboard computers to make product pitches based on where the car goes or set insurance rates based on how it is driven?
Do owners get docked points on their license if they send a car to park itself and it slams into another vehicle?
Once the stuff of science fiction, driverless cars could be commercially available by decade's end. Under a California law passed in 2012, the DMV must decide by the end of this year how to integrate the cars - often called autonomous vehicles - onto public roads.
That means the regulation's writers will post draft language regulations around June, then alter the rules in response to public comment by fall in order to get them finalized by the end of 2014.
Three other states have passed driverless car laws, but those rules mostly focus on testing. California has mandated rules on testing and public operation, and the DMV expects within weeks to finalize regulations dictating what companies must do to test the technology on public roads.
Those rules came after Google Inc. had already sent its fleet of Toyota Priuses and Lexuses, fitted with an array of sensors including radar and lasers, hundreds of thousands of miles in California. Major automakers also have tested their own models.
Now, the DMV is scrambling to regulate the broader use of the cars. With the federal government apparently years away from developing regulations, California's rules could effectively become the national standard.
Much of the initial discussion Tuesday focused on privacy concerns.
California's law requires autonomous vehicles to log records of operation so the data can be used to reconstruct an accident.
But the cars "must not become another way to track us in our daily lives," John M. Simpson of the nonprofit Consumer Watchdog said at the hearing. Simpson called out Google, saying the Internet giant rebuffed attempts to add privacy guarantees when it pushed the 2012 legislation mandating rules on testing and public operation.
Seated across from Simpson at the hearing's head tables was a representative from Google, who offered no comment on the data privacy issue.
Discussion also touched on how to know a car is safe, and whether an owner knows how to properly operate it.
Ron Medford, Google's director of safety for its "self-driving car" project, suggested that manufacturers should be able to self-certify that their cars are safe. He cautioned that it would get complicated quickly if the state tried to assume that role.
In initial iterations, human drivers would be expected to take control in an instant if the computer systems fail. Unlike current technology - which can help park a car or keep it in its freeway lane - owners might eventually be able to read, daydream or even sleep while the car did the work.
Responding to a question received over Twitter, DMV attorney Brian Soublet acknowledged that the department is still grappling with the most fundamental question of whether a person will need to be in the driver's seat.
Maybe not, by the time the technology is safe and reliable, he said.
Soublet asked who would ensure that owners know how to use the new technology. Should the onus be on dealers, manufacturers, owners?
Representatives of automakers suggested they shouldn't be asked to guarantee the capability of owners. John Tillman of Mercedes-Benz said the DMV could test owners on basics such as starting and stopping the automated driving function.
Automaker representatives also expressed concerns that other states could pass regulations that were substantially different from California, creating the kind of patchwork rules that businesses hate.
States outside California have been in touch and are following California's rule-making process closely, said Bernard Soriano, a deputy director at the DMV.
Other discussion centered on how vulnerable the cars could be to hackers, who might wrest control of the vehicles.
Industry representatives said that while that's a concern, they would vigilantly guard against such vulnerability because it would be disastrous.
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