BILL ANALYSIS Ó
SB 48
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Date of Hearing: July 15, 2015
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Jimmy Gomez, Chair
SB 48
(Hill) - As Amended July 7, 2015
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Urgency: No State Mandated Local Program: NoReimbursable: No
SUMMARY:
This bill makes numerous changes to the operation and governance
of the California Public Utilities Commission (PUC).
Specifically, this bill:
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1)Repeals the President of the PUC's authority to direct the
executive director, the attorney and other commission staff.
Makes related conforming changes.
2)Requires the PUC to hold at least six sessions each year in
Sacramento.
3)Requires the PUC to publish and include all written testimony
in proceeding docket cards. Requires the PUC to post
information on the Internet regarding how the public can
access the ratemaking process, the role of the Office of the
Public Advisor, and how the Office can be of assistance.
4)Expands reporting requirements to include specified
information regarding the details of PUC cases and
proceedings, and requires the PUC President to report on the
timeliness of resolving cases annually before the appropriate
legislative policy committees.
5)Expands the reporting requirements of the PUC's annual
workplan to include, among other things, performance criteria
for the PUC and its executive director as well as an annual
evaluation of the executive director based on the performance
criteria.
6)Subjects the PUC's adjudication proceedings to the
Administrative Adjudication Code of Ethics.
7)With the exception of adjudicated proceedings, requires the
PUC to seek and engage the views of those likely to be
affected by a decision or proceeding, as specified. Requires
the PUC to annually publish and update its outreach
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activities.
8)Provides that actions to enforce the PUC's process for
handling and determining disclosable public records, as well
as actions to enforce Bagley-Keene Open Meetings Act
requirements, may be taken to the superior court.
9)Makes various legislative findings regarding the judicial
review provisions of the Bagley-Keene Open Meetings Act.
FISCAL EFFECT:
1)Significant one-time information technology upgrades,
including contracting, systems development, staffing and
implementation costs of approximately $7.5 million (Public
Utilities Reimbursement Account) to fulfill the public
information requirements of the bill.
2)Ongoing annual costs of approximately $1.7 million (Public
Utilities Reimbursement Account) to maintain and operate the
new information technology systems.
3)One-time costs of $120,000 a year for two years for a
proceeding to establish rules for outreach, and ongoing costs
of up to $400,000 per year (Public Utilities Reimbursement
Account) to seek the views of interested persons.
4)Ongoing annual legal costs of approximately $335,000 for the
workload associated with superior court reviews of
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Bagley-Keene Open Meeting and Public Records Acts enforcement
actions.
5)Ongoing annual costs of up to $120,000 (Public Utilities
Reimbursement Account) to hold at least six meetings in
Sacramento instead of San Francisco. This includes the costs
of meetings sites, equipment and staff travel.
6)Potential increased annual costs in the range of tens of
thousands of dollars to the low hundreds of thousands of
dollars (Public Utilities Reimbursement Account) for
additional meetings in order for the Commission, rather than
the President, to direct the executive director, attorney and
staff.
7)Ongoing annual costs of $35,000 (Public Utilities
Reimbursement Account) for increased reporting requirements.
COMMENTS:
1)Purpose. According to the author, this bill will reform the
PUC's governing structure by clearly identifying the roles and
responsibilities of Commissioners and staff, and will require
PUC to reach out to communities affected by regulatory
decisions instead of only regulated utilities.
2)Background. The PUC is established in the California
Constitution and is governed by five full-time commissioners,
appointed by the governor and confirmed by the Senate. It is
staffed by approximately 1,000 individuals who, together,
regulate privately owned electric, natural gas,
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telecommunications, water, railroad, rail transit, and
passenger transportation companies. Staff includes four
personal advisors to each Commissioner, except five to the
president, as well as the 42 judges of the Administrative Law
Division - attorneys, engineers and accountants who prepare
the docket for all official filings, including maintenance of
the official record of proceedings.
The PUC is subject to the Bagley-Keene Open Meetings Act,
which requires a state body to take actions only at a public
meeting following the public posting of an agenda describing
the item for proposed action at least 10 days prior to the
meeting. Any private congregation of a majority of the members
of a state body at the same time and place to hear, discuss,
or deliberate upon any item that is within its jurisdiction is
unlawful. However, only the Supreme Court and the court of
appeal have the jurisdiction over any order or decision of the
PUC, including Bagley-Keene Open meeting requirements.
3)PUC Deficiencies. The PUC has recently undergone a number of
audits related to its budget, transportation program, natural
gas pipeline safety program, and other internal functions.
The audit findings raised questions regarding the PUC's
ability to manage its core functions. An audit by the State
Auditor in March of 2014 found the Commission lacks adequate
process for the sufficient oversight of utility balancing
accounts to protect ratepayers from unfair rate increases.
A recent report commissioned by the PUC found ex parte
communications to be frequent, pervasive, and at least
sometimes outcome-determinative in ratesetting cases.
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This bill addresses audit findings of mismanagement of public
funds, poor safety oversight, ex-parte communication
violations, and failed governance.
Analysis Prepared by:Jennifer Galehouse / APPR. / (916)
319-2081