BILL ANALYSIS                                                                                                                                                                                                    Ó



                                                                     AB 853


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          Date of Hearing:  May 13, 2015


                        ASSEMBLY COMMITTEE ON APPROPRIATIONS


                                 Jimmy Gomez, Chair


          AB  
          853 (Roger Hernández) - As Amended April 30, 2015


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          Urgency:  No                       State Mandated Local Program:  
           Yes      Reimbursable:  No


          SUMMARY:


          This bill requires electrical or gas corporations to utilize  
          direct employees for any work associated with its infrastructure  
          and computer systems. Specifically, this bill:  










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          1)Requires an electrical or gas corporation, to the extent  
            feasible, to utilize direct employees for any work associated  
            with the design, engineering, and operation of its nuclear,  
            electrical, and gas infrastructure, including all computer and  
            information technology systems.


          2)Defines direct employees for construction or maintenance work  
            to include the employees of a contractor or subcontractor  
            licensed in California working under the direct supervision of  
            the electrical or gas corporation.


          3)Requires an electrical or gas corporation, before utilizing  
            direct employees, to file a Tier 3 advice letter with the  
            Public Utilities Commission (PUC) that demonstrates that the  
            work can be performed safely and securely, and without  
            jeopardizing the security of its nuclear, electrical, and gas  
            infrastructure.  


          4)Requires the PUC to open a proceeding, or expand the scope of  
            an existing proceeding, to evaluate the advice letter and hold  
            at least one duly noticed public hearing.


          5)Requires the PUC to issue a written decision determining  
            whether the electrical or gas corporation may utilize persons  
            that are not direct employees for the described work.


          6)Declares existing law specifies a person or corporation owning  
            or operating a qualifying facility pursuant to federal law or  
            a facility that is an exempt wholesale generator is not an  
            electrical corporation due to the ownership or operation of  
            that facility.


          FISCAL EFFECT:








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          Increased costs to in the $200,000 range (special fund) for the  
          PUC to review advice letters and conduct proceedings.


          COMMENTS:




          1)Purpose.  According to the author, recent intrusions into  
            major corporate computer systems such as Sony and Antham Blue  
            Cross and theft of information from those systems have  
            demonstrated the vulnerability of those systems.  This bill  
            will prohibit electrical or gas corporations from outsourcing  
            critical nuclear, electrical and gas infrastructure work  
            without first obtaining approval from the PUC.




          2)Background. Recently, Southern California Edison (SCE)  
            announced plans to lay off hundreds of employees and hire  
            foreign workers.  SCE announced that it was laying off about  
            400 information technology employees, with an additional 100  
            leaving voluntarily.  SCE said that it was outsourcing some  
            tech-related work to two Indian companies, Infosys in  
            Bangalore and Tata Consultancy Services in Mumbai, after  
            looking at multiple firms.  


            In March 2015, the United States Senate Judiciary Committee  
            held a hearing focused on problems with foreign workers and  
            visa programs.  The hearing noted that visas are used to bring  
            high-skilled workers into the US to attract world-class talent  
            and lead in the global arena.  However, the hearing  
            highlighted stories of abuses causing the displacement of  
            American workers and noted visa programs are to complement the  








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            US workforce, not displace it.




          3)Drafting Considerations.  The Tier 3 advice letter process is  
            different than a formal proceeding and results in resolutions,  
            while a proceeding results in decisions.  If the author  
            intends the bill to require a formal proceeding to consider  
            the use of outside employees, he may wish to consider  
            requiring the electrical or gas corporations to file an  
            application rather than an advice letter.







          Analysis Prepared by:Jennifer Galehouse / APPR. / (916)  
          319-2081