Amended in Assembly September 4, 2015

Senate BillNo. 106


Introduced by Committee on Budget and Fiscal Review

January 9, 2015


begin deleteAn act relating to the Budget Act of 2015. end deletebegin insertAn act to add Section 12803.2.5 to the Government Code, and to amend Section 309.5 of, and to add Sections 326.6, 326.7, and 327.5 to, the Public Utilities Code, relating to the Public Utilities Commission, and making an appropriation therefor, to take effect immediately, bill related to the budget.end insert

LEGISLATIVE COUNSEL’S DIGEST

SB 106, as amended, Committee on Budget and Fiscal Review. begin deleteBudget Act of 2015. end deletebegin insertPublic Utilities Commission.end insert

begin insert

The California Constitution establishes the Public Utilities Commission with jurisdiction over all public utilities, authorizes the commission to establish its own procedures, subject to statutory limitations or directions and constitutional requirements of due process, and authorizes the commission to fix the rates and establish rules for public utilities, subject to control by the Legislature. The Public Utilities Act establishes an independent Office of Ratepayer Advocates within the Public Utilities Commission, to represent the interests of public utility customers and subscribers, with the goal of obtaining the lowest possible rate for service consistent with reliable and safe service levels. Existing law requires the director of the office to develop a budget for the office that is submitted to the Department of Finance for final approval. Existing law authorizes the director of the office to appoint a lead attorney to represent the office and requires the lead attorney to obtain adequate legal personnel for the work to be conducted by the office from the Public Utilities Commission’s attorney and requires the Public Utilities Commission’s attorney to timely and appropriately fulfill all requests for legal personnel made by the lead attorney for the office, provided the office has sufficient moneys and positions in its budget for the services requested. Existing law requires the commission to develop appropriate procedures to ensure that the existence of the office does not create a conflict of roles for any employee.

end insert
begin insert

This bill would delete the requirement that the lead attorney obtain adequate legal personnel for the work to be conducted by the office from the Public Utilities Commission’s attorney and the requirement that the Public Utilities Commission’s attorney timely and appropriately fulfill all requests for legal personnel made by the lead attorney for the office. The bill would require the commission to coordinate with the office in developing appropriate procedures to ensure that the existence of the office does not create a conflict of roles for any employee.

end insert
begin insert

The California Constitution provides that the Legislature has plenary power, unlimited by the other provisions of the constitution, to confer additional authority and jurisdiction upon the commission that is cognate and germane to the regulation of public utilities. The Public Utilities Act authorizes the commission to supervise and regulate every public utility and to do all things that are necessary and convenient in the exercise of its power and jurisdiction whether specifically designated in the act or in addition thereto.

end insert
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This bill would prohibit the commission from funding any program by a state entity using charges collected from public utility ratepayers unless expressly authorized to do so by statute enacted by the Legislature, including the annual Budget Act.

end insert
begin insert

Existing law requires the commission to submit to the Joint Legislative Budget Committee reports on all sources and amount of funding and actual and proposed expenditures for various activities.

end insert
begin insert

This bill would require the commission, on a semiannual basis, to provide the Joint Legislative Budget Commission a written notification of any redirection of funds and positions, including loaning staff to other state agencies or departments. The bill would require the California Research Bureau to conduct a review of the organization of the commission to ensure that the commission is the best governmental entity to direct, regulate, and oversee specified public utility sectors.

end insert
begin insert

Existing decisions of the commission establish the California Hub for Energy Efficiency Financing, or CHEEF, program, a 2-year pilot program administered by the California Alternative Energy and Advanced Transportation Financing Authority and funded through charges collected by specified electrical corporations and gas corporations from their ratepayers.

end insert
begin insert

The bill would require the commission to report to the relevant policy and fiscal committees of the Legislature on the outcomes of the CHEEF program and would prohibit the commission from approving any extension of the program sooner than 30 days after making its report.

end insert
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Existing law establishes the Government Operations Agency consisting of certain state entities, including the Department of Human Resources, which is governed by the Secretary of Government Operations.

end insert
begin insert

The bill would require the Secretary of Government Operations to contract with an independent, 3rd-party consulting firm to assess the degree to which each activity and position related to the energy responsibilities of the commission supports the core mission of the commission. The bill would require the secretary, by April 1, 2016, to submit a report to the Legislature on the assessment.

end insert
begin insert

The bill would appropriate $5,000,000 to the commission for the support of the commission.

end insert
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This bill would declare that it is to take effect immediately as a bill providing for appropriations related to the Budget Bill.

end insert
begin delete

This bill would express the intent of the Legislature to enact statutory changes relating to the Budget Act of 2015.

end delete

Vote: majority. Appropriation: begin deleteno end deletebegin insertyesend insert. Fiscal committee: begin deleteno end deletebegin insertyesend insert. State-mandated local program: no.

The people of the State of California do enact as follows:

P3    1begin insert

begin insertSECTION 1.end insert  

end insert

begin insertSection 12803.2.5 is added to the end insertbegin insertGovernment
2Code
end insert
begin insert, to read:end insert

begin insert
3

begin insert12803.2.5.end insert  

(a) The Secretary of Government Operations shall
4contract with an independent, third-party consulting firm to assess
5the degree to which each activity and position related to the energy
6responsibilities of the Public Utilities Commission, as identified
7in the commission’s zero-based budget conducted pursuant to
8Section 318 of the Public Utilities Code, supports the core mission
9of the commission and to make recommendations as to how
10resources might be better allocated to achieve the core mission
11objectives of the commission.

P4    1(b) The contracted consulting firm shall provide to the Joint
2Legislative Budget Committee and the Department of Finance
3monthly updates on the progress of the assessment.

4(c) (1) By April 1, 2016, the Secretary of Government
5Operations shall, pursuant to Section 9795, submit to the
6Legislature a report on the assessment.

7(2) Pursuant to Section 10231.5, this subdivision is inoperative
8on April 1, 2020.

9(d) The Public Utilities Commission shall reimburse the
10Government Operations Agency for the costs incurred pursuant
11to this section upon request by the agency and appropriation by
12the Legislature.

end insert
13begin insert

begin insertSEC. 2.end insert  

end insert

begin insertSection 309.5 of the end insertbegin insertPublic Utilities Codeend insertbegin insert is amended
14to read:end insert

15

309.5.  

(a) There is within the commission an independent
16Office of Ratepayer Advocates to represent and advocate on behalf
17of the interests of public utility customers and subscribers within
18the jurisdiction of the commission. The goal of the office shall be
19to obtain the lowest possible rate for service consistent with reliable
20and safe service levels. For revenue allocation and rate design
21matters, the office shall primarily consider the interests of
22residential and small commercial customers.

23(b) begin insert(1)end insertbegin insertend insert The director of the office shall be appointed by, and
24serve at the pleasure of, the Governor, subject to confirmation by
25the Senate.

26begin insert (2)end insertbegin insertend insert The director shall annually appear before the appropriate
27policy committees of the Assembly and the Senate to report on
28the activities of the office.

29(c) The director shall develop a budget for the office that shall
30be subject to final approval of the Department of Finance. As
31authorized in the approved budget, the office shall employ
32personnel and resources, including attorneys and other legal support
33staff, at a level sufficient to ensure that customer and subscriber
34interests are effectively represented in all significant proceedings.
35The office may employ experts necessary to carry out its functions.
36The director may appoint a lead attorney who shall represent the
37office, and shall report to and serve at the pleasure of the director.
38begin delete The lead attorney for the office shall obtain adequate legal
39personnel for the work to be conducted by the office from the
40commission’s attorney appointed pursuant to Section 307. The
P5    1commission’s attorney shall timely and appropriately fulfill all
2requests for legal personnel made by the lead attorney for the
3office, provided the office has sufficient moneys and positions in
4its budget for the services requested.end delete

5(d) The commission shallbegin insert coordinate with the office toend insert develop
6appropriate procedures to ensure that the existence of the office
7does not create a conflict of roles for any employee. The procedures
8shall include, but shall not be limited to, the development of a code
9of conduct and procedures for ensuring that advocates and their
10representatives on a particular case or proceeding are not advising
11decisionmakers on the same case or proceeding.

12(e) The office may compel the production or disclosure of any
13information it deems necessary to perform its duties from any
14entity regulated by the commission, provided that any objections
15to any request for information shall be decided in writing by the
16assigned commissioner or by the president of the commission, if
17there is no assigned commissioner.

18(f) There is hereby created the Public Utilities Commission
19Ratepayer Advocate Account in the General Fund. Moneys from
20the Public Utilities Commission Utilities Reimbursement Account
21in the General Fund shall be transferred in the annual Budget Act
22to the Public Utilities Commission Ratepayer Advocate Account.
23The funds in the Public Utilities Commission Ratepayer Advocate
24Account shall be a budgetary program fund administered and
25utilized exclusively by the office in the performance of its duties
26as determined by the director. The director shall annually submit
27a staffing report containing a comparison of the staffing levels for
28each five-year period.

29(g) On or before January 10 of each year, the office shall provide
30to the chairperson of the fiscal committee of each house of the
31Legislature and to the Joint Legislative Budget Committee all of
32the following information:

33(1) The number of personnel years utilized during the prior year
34by the Office of Ratepayer Advocates.

35(2) The total dollars expended by the Office of Ratepayer
36Advocates in the prior year, the estimated total dollars expended
37in the current year, and the total dollars proposed for appropriation
38in the following budget year.

39(3) Workload standards and measures for the Office of
40Ratepayer Advocates.

P6    1(h) The office shall meet and confer in an informal setting with
2a regulated entity prior to issuing a report or pleading to the
3commission regarding alleged misconduct, or a violation of a law
4or a commission rule or order, raised by the office in a complaint.
5The meet and confer process shall be utilized in good faith to reach
6agreement on issues raised by the office regarding any regulated
7entity in the complaint proceeding.

8begin insert

begin insertSEC. 3.end insert  

end insert

begin insertSection 326.6 is added to the end insertbegin insertPublic Utilities Codeend insertbegin insert, to
9read:end insert

begin insert
10

begin insert326.6.end insert  

The commission shall not fund any program by a state
11entity using charges collected from ratepayers unless expressly
12authorized to do so by statute enacted by the Legislature, including
13the annual Budget Act.

end insert
14begin insert

begin insertSEC. 4.end insert  

end insert

begin insertSection 326.7 is added to the end insertbegin insertPublic Utilities Codeend insertbegin insert, to
15read:end insert

begin insert
16

begin insert326.7.end insert  

The commission, on a semiannual basis, shall provide
17to the Joint Legislative Budget Committee a written notification
18of any redirection of funds and positions, including loaning staff
19to other state agencies or departments.

end insert
20begin insert

begin insertSEC. 5.end insert  

end insert

begin insertSection 327.5 is added to the end insertbegin insertPublic Utilities Codeend insertbegin insert, to
21read:end insert

begin insert
22

begin insert327.5.end insert  

(a) The California Research Bureau shall conduct a
23review of the organization of the commission to ensure that the
24commission is the best governmental entity to continue to direct,
25regulate, and oversee activities under the commission’s
26jurisdiction, including safety enforcement, in energy,
27communications, transportation, and water sectors, to determine
28whether other governmental entities are duplicating the activities
29of the commission, and to determine whether other governmental
30entities are better situated to regulate and oversee those activities.

31(b) In conducting the review, the California Research Bureau,
32in consultation with appropriate state entities, shall do all of the
33following:

34(1) Make recommendations as to which state or local agencies
35are best suited to regulate and oversee those activities specified
36in subdivision (a).

37(2) Make recommendations for improving oversight, regulation,
38and efficiency to best serve California’s ratepayers, businesses,
39and utilities.

P7    1(3) Estimate the costs associated with the implementation of its
2recommendations.

end insert
3begin insert

begin insertSEC. 6.end insert  

end insert
begin insert

The Public Utilities Commission shall report to the
4relevant policy and fiscal committees of the Legislature on the
5outcomes of the California Hub for Energy Efficiency Financing,
6or CHEEF, program. The commission shall not approve any
7extension of the CHEEF program sooner than 30 days after making
8its report pursuant to this section.

end insert
9begin insert

begin insertSEC. 7.end insert  

end insert
begin insert

The sum of five million dollars ($5,000,000) is hereby
10appropriated from the Public Utilities Commission Utilities
11Reimbursement Account to the Public Utilities Commission for
12the support of the commission.

end insert
13begin insert

begin insertSEC. 8.end insert  

end insert
begin insert

This act is a bill providing for appropriations related
14to the Budget Bill within the meaning of subdivision (e) of Section
1512 of Article IV of the California Constitution, has been identified
16as related to the budget in the Budget Bill, and shall take effect
17immediately.

end insert
begin delete
18

SECTION 1.  

It is the intent of the Legislature to enact statutory
19changes relating to the Budget Act of 2015.

end delete


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