BILL ANALYSIS                                                                                                                                                                                                    



          SENATE COMMITTEE ON APPROPRIATIONS
                             Senator Ricardo Lara, Chair
                            2015 - 2016  Regular  Session

          AB 682 (Williams) - Mobilehome park:  electric and gas service:   
          master-meter customers
          
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          |Version: June 25, 2015          |Policy Vote: T. & H. 10 - 0     |
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          |Urgency: Yes                    |Mandate: No                     |
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          |Hearing Date: July 13, 2015     |Consultant: Mark McKenzie       |
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          This bill does not meet the criteria for referral to the  
          Suspense File. 







          Bill  
          Summary:  AB 682, an urgency measure, would authorize the  
          conversion of master gas and electric utility meters in  
          mobilehome parks to direct utility service, pursuant to a  
          specified upgrade program, without the approval of the  
          Department of Housing and Community Development (HCD).  The bill  
          would require HCD to inspect the utility upgrades to ensure  
          adherence to specified health and safety standards.


          Fiscal  
          Impact:  HCD staffing costs of $952,000 in 2015-16, $928,000 in  
          2016-17, and $464,000 in 2017-18 for 8 PY to perform  







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          construction inspections of mobilehome utility meter  
          installations in conjunction with the Mobilehome Park Utility  
          Upgrade Pilot Program.  (Mobilehome-Manufactured Home Revolving  
          Fund)

          All costs are expected to be fully offset by inspection fee  
          revenues.  Position and fee authority for 2015-16 and 2016-17  
          was approved as part of the 2015 Budget Act. (see staff  
          comments)


          Background:  Existing law requires HCD to enforce various statutes  
          pertaining to manufactured homes and mobilehomes, including the  
          issuance of construction permits for alterations or conversions  
          to the structural, fire safety, plumbing, heat-producing, or  
          electrical systems and installations or equipment.  Mobilehome  
          owners must document that they own their unit in order to apply  
          for a construction or alteration permit. 
          Existing law, AB 622 (Conroy), Ch. 424/1996, requires mobilehome  
          parks constructed after January 1, 1997 to provide directly  
          metered natural gas and/or electric service to individual  
          mobilehomes from the gas or electric utility corporation that  
          provides service in the area where the park is located.  AB 622  
          also established a statutory framework for transferring existing  
          master-metered mobilehome parks to utilities that provide direct  
          service in the area where the park is located, but very few  
          conversions have taken place since the law took effect.  


          In response to the lack of conversions, and in recognition of  
          the benefits, the California Public Utilities Commission (CPUC)  
          initiated a voluntary three-year pilot program (the Mobilehome  
          Park Utility Upgrade Program) that authorizes each California  
          investor-owned utility to convert 10% of master-metered gas  
          and/or electric mobilehome park spaces within its operating  
          territory to direct utility service (CPUC Decision 14-03-021).   
          The CPUC began accepting forms of intent to participate in the  
          program early this year, and expects to begin conversions in  
          September of 2015.  The program will continue until December 31,  
          2017.  Costs for the utility conversions will be paid by  
          ratepayers in the utility's service area.


          Under current law, the construction work related to the upgrade  








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          program will require permits and inspections by HCD to ensure  
          completed work meets code and is safe prior to conversion to  
          directly metered service.




          Proposed Law:  
            AB 682, an urgency measure, would authorize the alteration or  
          conversion of specified systems or equipment of a manufactured  
          home or mobilehome  to extend a gas line and/or electrical  
          feeder line from a utility-owned service line to the home's  
          subpanel or inlet for purposes of a utility service upgrade  
          pursuant to CPUC's Mobilehome Park Utility Upgrade Program,  
          without filing an application with HCD.  
          The bill would also authorize repair or replacement of any  
          defects in the home related to heat-producing or electrical  
          systems or installations without filing an application for  
          alteration or conversion with HCD, if repair or replacement is  
          necessary, is made promptly, and is approved by HCD.


          AB 682 would require HCD to inspect any specified alteration or  
          conversion to ensure adherence to applicable health and safety  
          standards, and rules and regulations.




          Staff  
          Comments:  This bill is intended to facilitate master meter  
          conversions in mobilehome parks by eliminating an HCD permit  
          requirement (but not inspection requirement) in order to  
          participate in the CPUC's participation in the Mobilehome Park  
          Utility Upgrade Program.  The author indicates that many  
          mobilehome owners may not have proper ownership documentation  
          necessary for an HCD construction permit, due to multiple title  
          transfers and lack of compliance with change-of-ownership  
          requirements.
          The Governor's proposed 2015-16 budget included a request for  
          expenditure authority for the positions that HCD indicates would  
          be required to comply with the necessary permitting and  
          inspections related to the CPUC's Mobilehome Park Utility  
          Upgrade Program.  On May 7, 2015, Senate Budget Subcommittee 4  








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          approved position and expenditure authority for the 8 PY of  
          staff as two-year limited term positions, noting that in two  
          years the justification for permanent staff, based on initial  
          results from the pilot project, can be revisited.


          Staff notes that HCD has current authority to charge a technical  
          service fee for each utility meter inspection its staff  
          performs.  Current regulations establish a fee of $196 for the  
          first hour (which accounts for travel time), $82 for the second  
          hour, and $40 for each 30 minutes thereafter.  HCD indicates  
          that these fees are expected to fully offset the identified  
          staffing costs to conduct inspections associated with mobilehome  
          park utility upgrades.




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