BILL ANALYSIS Ó
SB 18
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SENATE THIRD READING
SB
18 (Hill and Hueso)
As Amended August 24, 2015
Majority vote
SENATE VOTE: 39-0
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|Committee |Votes|Ayes |Noes |
| | | | |
| | | | |
| | | | |
|----------------+-----+-----------------------+---------------------|
|Utilities |13-0 |Rendon, Patterson, | |
| | |Achadjian, Bonilla, | |
| | |Burke, Cristina | |
| | |Garcia, Hadley, Roger | |
| | |Hernández, Obernolte, | |
| | |Quirk, Santiago, Ting, | |
| | |Williams | |
| | | | |
|----------------+-----+-----------------------+---------------------|
|Appropriations |14-0 |Gomez, Bigelow, Bloom, | |
| | |Bonta, Calderon, | |
| | |Chang, Eggman, | |
| | |Gallagher, Eduardo | |
| | |Garcia, Jones, Quirk, | |
| | |Rendon, Weber, Wood | |
| | | | |
| | | | |
SB 18
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SUMMARY: Requires any contract entered into by the California
Public Utilities Commission (CPUC) for outside legal counsel
services to represent it in a criminal investigation to be
submitted to the Joint Legislative Budget Committee for review
and approved by a vote of the CPUC no sooner than 30 days after
the contract has been submitted to the committee. Specifically,
this bill:
1)Requires any contract or other agreement by the CPUC for
services by outside legal counsel to represent the CPUC in a
criminal investigation initiated by any federal, state, or
local agency to be approved by a vote of the CPUC no sooner
than 30 days after the contract or agreement is submitted to
the Joint Legislative Budget Committee for review.
2)Requires the contract or other agreement submitted to the
Joint Legislative Budget Committee to be accompanied by:
a) The funds that the CPUC will use to pay for these
services;
b) Whether the CPUC has followed all of the laws and
procedures applicable to contracting for legal services;
and
c) Whether, and to what degree, existing programs and
operations of the CPUC will be affected.
Fiscal Effect: According to the Assembly Appropriations
Committee, this bill would have minor, absorbable costs, if any.
SB 18
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COMMENTS:
1)Author Statement: "The [CPUC] recently hired criminal defense
attorney for $5.2 million dollars without a vote of the
commissioners ? The [CPUC] paid for the criminal attorney out
of money that would have gone toward hiring
legislatively-authorized positions, improving Information
Technology, strategic planning, and employee training. As
such, the [CPUC] is undermining its ability to fulfill its
statutory and Constitutional responsibilities by hiring a
criminal attorney. For this reason, such a contract should be
subject to a vote of the commissioners, and it should receive
an expedited review by the Legislature. These straightforward
means of oversight would incentivize the [CPUC] to be very
clear on the purpose and scope of any proposal to spend money
on criminal defense."
2)Background: In September 2015, the California Attorney
General (AG) opened an independent investigation on the CPUC
over issues relating to the 2010 San Bruno pipeline explosion
and the selection of an administrative law judge for a rate
setting case. The AG is investigating whether CPUC officials
were influenced by the Pacific Gas and Electric Company (PG&E)
to select a more favorable judge to hear a rate setting case
involving the 2010 San Bruno explosion in which the utility is
seeking to pay for $1.3 billion in pipeline improvements with
ratepayer funds.
In October 2014, the CPUC sent a letter to the AG's office
requesting the AG's office to represent it in the AG's
investigation. The AG's office declined the request based on
potential conflicts of interest.
In November 2014, the CPUC signed a $49,000 contract with the
law firm of Sheppard Mullin to represent it in the AG's
SB 18
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investigation. The contract was subsequently amended to
increase the contract to $5.2 million in March 2015. Due to
the ongoing criminal investigations on CPUC officials and
their relationships with regulated utility officials relating
to the San Bruno explosion, there have been questions on
whether or not it is appropriate for the CPUC to use ratepayer
funds to pay for its outside legal counsel defense, instead of
seeking all civil service attorney options.
This bill requires any contract or other agreement by the CPUC
in which the CPUC retains outside legal counsel services to
represent the CPUC in a criminal investigation initiated by
any federal, state, or local agency to be submitted to the
Joint Legislative Budget Committee for review and approved by
a vote of the CPUC no sooner than 30 days after the contract
or agreement has been submitted. The bill requires the
contract or other agreement submitted to the Joint Legislative
Budget Committee to be accompanied by a) the funds that the
CPUC will use to pay for these services, b) whether the CPUC
has followed all of the laws and procedures applicable to
contracting for legal services, and c) whether, and to what
degree, existing programs and operations of the CPUC will be
affected.
Analysis Prepared by:
Edmond Cheung / U. & C. / (916) 319-2083 FN:
0001504
SB 18
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