BILL ANALYSIS                                                                                                                                                                                                    Ó




                   Senate Appropriations Committee Fiscal Summary
                            Senator Kevin de León, Chair


          AB 1409 (Committee on Utilities and Commerce) - Energy
          
          Amended: As introduced          Policy Vote: EU&C 6-1
          Urgency: No                     Mandate: No
          Hearing Date: July 1, 2013      Consultant: Marie Liu
          
          This bill does not meet the criteria for referral to the  
          Suspense File.
          
          
          Bill Summary: AB 1409 would delete the statutorily set $75  
          application fee for a certificate of public convenience and  
          necessity (CPCN) and instead allow the California Public  
          Utilities Commission (CPUC) to set the fee and adjust that fee  
          for inflation. The bill would also make technical corrections to  
          code references.

          Fiscal Impact: Potential minor revenue increases in the low tens  
          of thousands of dollars to the Public Utilities Commission  
          Utilities Reimbursement Account (special) for increased fee  
          revenues on CPCN applications.

          Background: Existing law requires the CPUC to charge a $75  
          filing fee for an application for a CPCN. This fee has been set  
          at this level since at least 1969.

          Proposed Law: This bill would delete the specification that the  
          CPCN filing fee be $75 and instead would allow the CPUC to  
          determine the fee and adjust that fee based on the Consumer  
          Price Index. 

          Staff Comments: According to the CPUC, it costs several thousand  
          dollars in staff time to review CPCN applications. The purpose  
          of the filing fee is not to fully cover the staff time necessary  
          to review applications, but to demonstrate commitment to  
          utilizing the certificate should it be granted. However, the  
          current fee of $75 is too low to be able to indicate the  
          applicant's level of commitment. If the fee had been indexed to  
          the Consumer Price Index (CPI) since 1969, the fee would now be  
          approximately $473.

          Staff notes that the language of the bill is unclear whether the  








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          CPUC could set the fee at any level or whether its adjustments  
          would be limited to the CPI. Staff recommends that the bill be  
          amended so that the filing fee is reestablished at $500, which  
          is consistent with a CPUC proposed decision 11-11-006 on this  
          matter and CPI adjustment from 1969, and allow the CPUC to  
          adjust this fee in the future only according to the CPI. 

          Staff also recommends inclusion of a technical amendment to  
          clarify that all fees are to be deposited in the Public  
          Utilities Commission Utilities Reimbursement Account, consistent  
          with PUC §409 by deleting §1906.

          Recommended Amendments: On page 11, delete lines 10-12  
          inclusively and insert, "$500. The commission may adjust this  
          fee based on the Consumer Price Index." 

          Delete §1906 of the PUC.