BILL ANALYSIS                                                                                                                                                                                                    Ó



          SENATE COMMITTEE ON ENERGY, UTILITIES AND COMMUNICATIONS
                              Senator Ben Hueso, Chair
                                2015 - 2016  Regular 

          Bill No:          AB 2746           Hearing Date:    6/21/2016
           ----------------------------------------------------------------- 
          |Author:    |Obernolte                                            |
          |-----------+-----------------------------------------------------|
          |Version:   |3/28/2016    As Amended                              |
           ----------------------------------------------------------------- 
           ------------------------------------------------------------------ 
          |Urgency:   |No                     |Fiscal:      |Yes             |
           ------------------------------------------------------------------ 
           ----------------------------------------------------------------- 
          |Consultant:|Nidia Bautista                                       |
          |           |                                                     |
           ----------------------------------------------------------------- 
          
          SUBJECT: Public Utilities Commission:  contracts:  electronic  
          submissions

            DIGEST:    This bill requires the California Public Utilities  
          Commission (CPUC) to adopt procedures authorizing the submittal  
          of electronic signatures and documents by all parties on  
          contracts involving the CPUC.

          ANALYSIS:
          
          Existing law:
          
          1)Defines "electronic signature" to mean an electronic sound,  
            symbol, or process attached to or logically associated with an  
            electronic record and executed or adopted by a person with the  
            intent to sign the electronic record.  (Code of Civil  
            Procedures §17).

          2)Establishes the Uniform Electronic Transactions Act, which  
            provides for specified requirements related to the use of  
            electronic documents, including authorizing the use of an  
            electronic record when a law requires a signature. 
          (Code of Civil Procedures §1633.1 et seq.)

          This bill requires the CPUC to adopt procedures authorizing the  
          submittal of electronic signatures and documents by all parties  
          on contracts involving the CPUC.

          Background

          The CPUC, like other state agencies, contracts with outside  







          AB 2746 (Obernolte)                                Page 2 of ?
          
          
          consultants when it lacks the in-house resources or expertise to  
          execute a given service.  For example, the CPUC contracts with  
          outside legal counsel to perform public records requests, assess  
          the gas pipeline safety programs, review the agency's ex parte  
          communications practices, and others.  The CPUC, like other  
          state agencies, relies on the Department of General Services  
          (DGS) State Contracting Manual when soliciting or entering into  
          a contract to provide services.  The roughly 150-page manual  
          includes a requirement that contracts include original  
          handwritten signatures (noted on page 46).  As a result, a  
          contract may need to be shuttled across the state to various  
          locations to secure original signatures from the various  
          parties, often resulting in increased cost for delivery and a  
          delay in executing the agreement.  On the other hand, the use of  
          electronic signatures can reduce the need to mail original  
          documents across the state and save time by securing a signature  
          rather quickly. 

          Several laws have been passed to explicitly authorize the use of  
          electronic signatures on various documents ranging from  
          warrants, court documents, county board of equalization  
          applications, documents submitted to the Department of Motor  
          Vehicles, and many others.  However, in the case of state  
          contracting practices the DGS Manual still requires original  
          signatures.  This bill would require the CPUC to establish  
          procedures authorizing the use of electronic signatures. 

          Better placed at DGS.  The requirement to authorize the use of  
          electronic signatures for state contracts may be better placed  
          at the DGS since they are the agency responsible developing the  
          state contracting manual. 

          FISCAL EFFECT:                 Appropriation:  No    Fiscal  
          Com.:             Yes          Local:          No


            SUPPORT:  

          None received

          OPPOSITION:  

          None received

          ARGUMENTS IN SUPPORT:    The author states "the DGS State  








          AB 2746 (Obernolte)                                Page 3 of ?
          
          
          Contracting Manual requires contracts to have original  
          handwritten signatures.  At the CPUC, contracts often involve  
          numerous signatories in various locations.  Getting wet  
          signatures from all of these individuals requires contract  
          documents to be mailed to each party.  Not only is this process  
          inefficient and difficult to track, it is also costly and  
          creates opportunities for the documents to get lost along the  
          way.  If this happens, the process must start over, leading to  
          additional costs and delays."


          

                                      -- END --