BILL ANALYSIS Ó
AB 2903
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Date of Hearing: April 13, 2016
ASSEMBLY COMMITTEE ON UTILITIES AND COMMERCE
Mike Gatto, Chair
AB 2903
(Committee on Utilities and Commerce) - As Introduced March 3,
2016
SUBJECT: Wharfingers: warehouseman: California Consumer Power
and Conservation Financing Authority: energy crisis litigation
SUMMARY: Deletes obsolete language in the Public Utilities Code
related to Wharfinger and warehouseman, and the California
Consumer Power and Conservation Financing Authority (CPA).
Specifically, this bill:
1)Deletes the authority for a warehouseman to condemn property
necessary for the construction and maintenance of facilities
for storing property.
2)Deletes the authority for a wharfinger to condemn property
necessary for the construction and maintenance of facilities
for the receipt or discharge of freight or passengers.
3)Require the Attorney General (AG) to represent the Department
of Finance and to succeed all rights, claims, powers, and
entitlements of the CPA in any litigation or settlement
relating to the 2000-02 energy crisis.
AB 2903
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4)Repeals the California Consumer Power and Conservation
Financing Authority Act.
EXISTING LAW:
1)Applies rights and obligations with respect to eminent domain
only to a corporation or a person that is a public utility.
(Public Utilities Code 610 through 626).
2)Authorizes a wharfinger to condemn any property necessary for
the construction and maintenance of facilities for the receipt
or discharge of freight or passengers. (Public Utilities Code
Section 619)
3)Authorizes a warehouseman to condemn any property necessary
for the construction and maintenance of its facilities for
storing property. (Public Utilities Code Section 623)
4)Requires the AG to represent the Department of Finance to
succeed to, and may exercise, all rights, claims, powers, and
entitlements of the Electricity Oversight Board in any
litigation or settlement related to the 2000-02 energy crisis,
as specified. (Public Utilities Code Section 343)
5)Establishes the CPA to provide the state with reliable,
affordable electrical power, to ensure sufficient power
reserves, to assure stability and rationality in California's
electricity market, to encourage energy efficiency and
conservation as well as the use of renewable energy resources,
and to protect the public health, welfare, and safety.
(Public Utilities Code Section 3300 et seq.)
AB 2903
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6)Sunsets the CPA's authority to finance or approve any new
program, enterprise, or project on January 1, 2007.
FISCAL EFFECT: Unknown.
COMMENTS:
1)Background: Article XII of the California Constitution
establishes the California Public Utilities Commission (CPUC)
and grants it the authority to regulate public utilities. In
1980, the Legislature removed warehouseman as a public
utility. However, in the process, the Legislature did not
delete the stated authority granting a warehouseman that is a
public utility to condemn property necessary for the
construction and maintenance of facilities for storing
property. Furthermore, in 1987, the Legislature also removed
wharfingers as a public utility, but also did not delete the
stated authority granted to a wharfinger that is a public
utility to condemn property necessary for the construction and
maintenance of facilities for the receipt or discharge of
freight or passengers. This discrepancy left the authority to
condemn property by warehouseman and wharfingers that are
public utilities in the Public Utilities Code, but it is no
longer applicable because warehouseman and wharfingers were no
longer classified as public utilities.
This bill would delete the obsolete authority of a wharfinger
or warehouseman to condemn property from statute.
AB 2903
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2)California Consumer Power and Conservation Financing
Authority: The CPA was established during the height of the
2000-02 energy crisis in 2001 under SB 6 X1 (Burton), Chapter
10, Statutes of 2001-02 First Extraordinary Session. The CPA
was created to ensure that the state had reliable, affordable
electrical power, establish sufficient power reserves, assure
stability and rationality in the state's electricity market,
encourage energy efficiency and conservation as well as the
use of renewable energy resources, and protect the public
health, welfare, and safety. The CPA was authorized to issue
up to $5 billion in revenue bonds to finance such activities.
Since the establishment of the CPA it has been unsuccessful in
financing new power plants but has had some success in
implementing projects that encourage energy conservation, and
has also contributed to the states effort to ensure adequate,
reliable, and reasonably price electricity and natural gas for
California's consumers. Despite this, the CPA duties
diminished as California recovered from the 2000-02 energy
crisis and other state energy agencies and private entities
were already performing similar activities. The CPA's
authority to finance or approve any new program, enterprise,
or project sunset on January 1, 2007.
This bill would repeal the CPA and its authorities from
statute.
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3)Energy Crisis Litigation: Under current law, the AG is
required to represent the Department of Finance to succeed to,
and may exercise, all rights, claims, powers, and entitlements
of the Electricity Oversight Board in any litigation or
settlement related to the 2000-02 energy crisis. The United
States Supreme Court recently ruled that energy companies can
be sued under state antitrust laws for illegally manipulating
natural gas prices during the 2000-02 energy crisis. As a
result, there are likely additional claims related to the
energy crisis ahead.
This bill requires the AG to represent the Department of
Finance and to succeed all rights, claims, powers, and
entitlements of the CPA in any litigation or settlement
relating to the 2000-02 energy crisis.
4)Prior Legislation:
AB 1524 (Utilities and Commerce Committee), Chapter 382,
Statutes of 2015: Extends the sunset date that requires the
AG to represent the Electricity Oversight Board in any
litigation or settlement related to the 2000-02 energy
crisis, from January 1, 2016, to January 2, 2018.
REGISTERED SUPPORT / OPPOSITION:
Support
AB 2903
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None on file.
Opposition
None on file.
Analysis Prepared by:Edmond Cheung / U. & C. / (916) 319-2083