BILL ANALYSIS Ó
AB 2168
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Date of Hearing: April 13, 2016
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Lorena Gonzalez, Chair
AB
2168 (Williams) - As Amended April 4, 2016
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Urgency: No State Mandated Local Program: NoReimbursable: No
SUMMARY:
This bill revises California Public Utilities Commission (PUC)
reporting requirements on inspections and audits and modifies
current auditing requirements. Specifically, this bill:
1)Deletes the requirement for the PUC's to furnish reports on
inspections and audits and other pertinent information to the
Board of Equalization (BOE) and instead requires the PUC to
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post the specified documents on its Internet Web site.
2)Requires the PUC to develop a risk-based approach for
periodically reviewing balancing accounts to ensure that
ratepayer funds are used for allowable purposes and are
supported by appropriate documentation. Requires the PUC to
maintain an inventory of the balancing accounts.
3)Requires the PUC to require public utilities to record all
related costs and revenues in the balancing accounts, unless
specific costs or revenues are exempted by the PUC.
4)Requires the PUC to adopt balancing account review procedures
that prioritize certain types of accounts, as specified.
5)Requires the PUC to forego the required balancing account
review if the Office of Ratepayer Advocates or an independent
Auditor plans to review or audit the account. Requires the
PUC to retain sole responsibility for the results of the
delegated reviews or audits.
FISCAL EFFECT:
Additional costs are absorbable within existing resources.
COMMENTS:
1)Purpose. According to the author, this bill codifies the
State Auditor's recommendations to the Legislature regarding
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the PUC's review of utility balancing accounts and the release
of utility audit and inspection reports.
2)Background. In March 2014, the State Auditor issued a report
in response to a request by the Joint Legislative Audit
Committee concerning the PUC oversight of the utility
balancing accounts of the entities it regulates. The Auditor
found the PUC lacked adequate oversight over balancing
accounts, and did not always comply with legal audit
requirements. Additionally, for over three decades, the PUC
failed to provide audit results to the BOE for tax purposes.
This bill addresses the audit findings and implements its
recommendations.
3)Balancing Accounts. A balancing account is a tracking
mechanism used to ensure a utility recoups from ratepayers any
costs the PUC has authorized. The balancing account also
ensures ratepayers do not pay more than they should. If a
balancing account has a balance indicating an over- or
under-collection from ratepayers, the utility will generally
seek to adjust future rates to either refund or recoup the
balance.
Analysis Prepared by:Jennifer Galehouse / APPR. / (916)
319-2081
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