BILL ANALYSIS Ó
SB 215
Page A
Date of Hearing: June 29, 2016
ASSEMBLY COMMITTEE ON UTILITIES AND COMMERCE
Mike Gatto, Chair
SB
215 (Leno) - As Amended June 20, 2016
SENATE VOTE: 37-0
SUBJECT: Public Utilities Commission
SUMMARY: Enacts various reforms to existing law to address
issues of governance, transparency, and accountability at the
California Public Utilities Commission (CPUC). Specifically,
this bill:
1)Specifies a commissioner is to be recused for bias or
prejudice by requiring the CPUC to adopt procedures for the
recusal or disqualification of a commissioner due to bias or
prejudice; prohibits an administrative law judge (ALJ) or
commissioner from ruling on any motion seeking their own
recusal or disqualification and changes the legal standard for
recusal or disqualification from "unalterably closed mind" to
the existence of "bias or prejudice."
2)Reforms ex parte communication, as specified.
3)Reforms penalties for sanctions related to violations of ex
SB 215
Page B
parte rules.
4)Authorizes the Attorney General to bring an enforcement
action, decided by the Superior Court, to assess civil
sanctions against a decisionmaker or employee of the CPUC who
violates ex parte rules.
5)Sets maximum civil financial penalties for ex parte violations
at $50,000 per violation. New provisions include factors that
may be considered in the assessment of penalties such as the
severity of the violation and the financial resources of the
offender.
EXISTING LAW:
1)Requires that the commission adopt procedures on the
disqualification of administrative law judges due to bias or
prejudice similar to those of other state agencies and
superior courts. (Public Utilities Code Section 309.6)
2)Requires the CPUC to determine the nature of a proceeding,
specifically whether it is quasi-legislative, ratesetting, or
adjudicatory and establishes definitions and rules related to
each. (Public Utilities Code Section 1701.1)
3)Directs the CPUC to adopt by regulation rules to define
decisionmakers and persons for purposes of applying ex parte
communication rules. (Public Utilities Code Section 1701.1)
SB 215
Page C
4)Prescribes procedures for adjudication cases if the CPUC
determines the case requires a hearing. (Public Utilities Code
Section 1701.2)
5)Prescribes procedures for ratesetting cases if the CPUC
determines the case requires a hearing. (Public Utilities Code
Section 1701.3)
1)Prescribes procedures for quasi-legisiative cases if the CPUC
determines the case requires a hearing. (Public Utilities Code
Section 1701.3)
6)Specifies that the complainant and the corporation or person
complained of, and such corporations or persons as the CPUC
allows to intervene shall be entitled to be heard and to
introduce evidence. (Public Utilities Code Section 1701.5)
FISCAL EFFECT: Unknown.
COMMENTS:
1)Author's Statement: "In 2010, the City of San Bruno
experienced a preventable pipeline explosion that caused
horrible suffering and loss of life. More recently, a release
of emails related to the San Bruno disaster and the San Onofre
nuclear plant closing has revealed serious flaws in the
management structure and operation of the CPUC. These emails
have amply demonstrated that the relationships between the
Commission and its regulated utilities are too close, and too
informal, to inspire confidence that ratepayer and non-utility
SB 215
Page D
interests are adequately represented by the Commission.
"In response to these events, the CPUC's top management asked
the law firm of Strumwasser & Woocher LLP to assess current
laws and practices related to ex parte communications and to
compare the [CPUC's] rules with best practices regarding ex
parte communications from other utility regulators. The report
found that ex parte communications are 'frequent, pervasive,
and at least sometimes outcome-determinative in CPUC
ratesetting cases.'<1> It declared that these practices are
'fundamentally unfair to the parties' and 'have come to
fundamentally undermine record-based decision-making and to
transform the very nature of CPUC rate hearings.'<2>
SB 215 includes enhanced disclosure ofsubstantive ex parte
communications in ratesetting cases, new requirements for
decisionmakers to disclose ex parte communications in
ratesetting cases, and specific sanctions for illegal ex parte
communications for both interested persons such as utilities,
and for decisionmakers such as Commissioners and senior CPUC
staff. It is important to understand that the [CPUC's] role in
many circumstances is to act as prosecutor, judge, and jury,
often with consequences for human life and safety as well as
large financial impacts for ratepayers and utilities. In this
high-powered, high-stakes environment, we must protect the
impartiality of the [CPUC], not only in adherence to basic
fairness, but also to ensure public confidence in CPUC
decisions.
"What we face today is an erosion of public trust in the
institution Californians rely upon to protect life safety and
--------------------------
<1>
Strumwasser, M.J.; Grossman Palmer, B.; Larson, D.K., Report to
the California Public Utilities Commission Regarding Ex Parte
Communications and Related Practices, Strumwasser & Woocher, LLP
June 22, 2015, Page 4. (Report attached.)
<2> ibid, Page 4.
SB 215
Page E
to keep utility monopolies in check. By bolstering standards
for recusal of commissioners, reforming ex parte communication
rules, increasing transparency, and tightening penalties for
ex parte violations, SB 215 will help instill a new ethic and
bring meaningful change to the [CPUC]."
2)Principles of California Public Utilities Commission Reform:
On Monday June 27, 2016, Governor Brown and Assemblymember
Gatto, Chair of the Assembly Utilities and Commerce Committee
announced an agreement on Principles for Reforms of the CPUC.
This bill includes several of these principles already,
including:
a) Ex Parte reforms.
b) Authorizing the Attorney General to bring an enforcement
action in superior court against a decisionmaker or
employee of the commission who violates the ex parte
communication requirements.
SB 512 (Hill) and SB 1017 (Hill) of 2016 include other
elements of the principles.
3)Suggested Amendments: The author may wish to consider the
following amendments:
a) Include a specific prohibition against conversing with
commissioners regarding selection of administrative law
judges in lieu of language in the bill that would deem this
an ex parte communication.
b) Prohibit ex parte communications 3 days before a
commission vote.
SB 215
Page F
c) Require inclusions of topics discussed and relevant
proceeding numbers in ex parte reporting.
d) Include an equal time rule for ex parte communications
to ensure that other interested parties are allowed access
to commissioners.
SECTION 1. Section 309.6 of the Public Utilities Code is
amended to read:
309.6. (a) The commission shall adopt procedures on the
disqualification of commissioners and administrative law
judges due to bias or prejudice similar to those of other
state agencies and superior courts.
(b) (1) For ratesetting and adjudicatory proceedings, a
commissioner or administrative law judge shall be disqualified
for bias or prejudice based on either of the following:
(A) Actions taken during the proceeding that demonstrate bias
or prejudice.
(B) Actions demonstrating any commitment to provide relief to
a party.
(2) Past work experience by the commissioner or administrative
law judge shall not be a sufficient basis for demonstrating
bias or prejudice pursuant to paragraph (1).
(c) The commission procedures shall not authorize a
commissioner or administrative law judge to rule on a motion
made by a party to a proceeding to disqualify the commissioner
or administrative law judge due to bias or prejudice.
(d) The commission shall develop the procedures with the
opportunity for public review and comment.
SEC. 2. Section 1701.1 of the Public Utilities Code is amended
to read:
1701.1. (a) The commission shall determine whether each
proceeding is a quasi-legislative, an adjudication, or a
ratesetting proceeding and, consistent with due process,
SB 215
Page G
public policy, and statutory requirements, determine whether
the proceeding requires a hearing. The commission's decision
as to the nature of the proceeding shall be subject to a
request for rehearing within 10 days of the date of that
decision or of any subsequent ruling that expands the scope of
the proceeding. Only those parties who have requested a
rehearing within that time period shall subsequently have
standing for judicial review and that review shall only be
available at the conclusion of the proceeding. The commission
shall render its decision regarding the rehearing within 30
days. The commission shall establish rules regarding ex parte
communication on case categorization issues.
(b) The commission, upon initiating an adjudication
proceeding or ratesetting proceeding, shall assign one or
more commissioners to oversee the case and an administrative
law judge where appropriate. The assigned commissioner shall
schedule a prehearing conference. The assigned commissioner
shall prepare and issue by order or ruling a scoping memo that
describes the issues to be considered and the applicable
timetable for resolution. The administrative law judge shall
either preside and conduct, or assist the assigned
commissioner or commissioners in presiding and conducting, any
evidentiary or adjudication hearing that may be required.
(c) The commission, upon initiating a quasi-legislative
proceeding, shall assign one or more commissioners to oversee
the case and an administrative law judge, where appropriate,
who may be assisted by a technical advisory staff member in
conducting the proceeding. The assigned commissioner shall
prepare and issue by order or ruling a scoping memo that
describes the issues to be considered and the applicable
timetable for resolution.
(d) (1) Quasi-legislative cases, for purposes of this
article, are cases that establish policy, including, but not
limited to, rulemakings and investigations which may establish
rules affecting an entire industry.
(2) Adjudication cases, for purposes of this article, are
enforcement cases and complaints except those challenging the
reasonableness of any rates or charges as specified in Section
1702.
SB 215
Page H
(3) Ratesetting cases, for purposes of this article, are cases
in which rates are established for a specific company,
including, but not limited to, general rate cases,
performance-based ratemaking, and other ratesetting
mechanisms.
(4) "All-party conference," for purposes of this article, is a
public hearing held on the record before a quorum of
commissioners at which all parties to a proceeding shall have
the right to participate and communicate their views regarding
any factual, legal, or policy issue in the proceeding.
(e) (1) (A) "Ex parte communication," for purposes of this
article, means any oral or written communication between a
decisionmaker and an interested person concerning any matter
before the commissionthat the commission has not specified in
its Rules of Practice and Procedure as being a procedural
matter and that does not occur in a public hearing, workshop,
or other public proceeding, or on the official record of the
proceeding on the matter. The commission shall specify in its
Rules of Practice and Procedure, enacted by rulemaking, the
types of issues considered procedural matters under this
article. Any communication between an interested person and a
decisionmaker regarding which commissioner or administrative
law judge may be assigned to a matter before the commission
shall not be deemed to be a procedural matter and shall be an
ex parte communication subject to this article .
(B) "Interested person," for purposes of this article, means
any of the following:
(i) Any applicant, an agent or an employee of the applicant,
or a person receiving consideration for representing the
applicant, or a participant in the proceeding on any matter
before the commission.
(ii) Any person with a financial interest, as described in
Article 1 (commencing with Section 87100) of Chapter 7 of
Title 9 of the Government Code, in a matter before the
commission, or an agent or employee of the person with a
financial interest, or a person receiving consideration for
representing the person with a financial interest. A person
involved in issuing credit ratings or advising entities or
persons who invest in the shares or operations of any party to
SB 215
Page I
a proceeding is a person with a financial interest.
(iii) A representative acting on behalf of any civic,
environmental, neighborhood, business, labor, trade, or
similar organization who intends to influence the decision of
a commission member on a matter before the commission.
(iv) Other categories of individuals deemed by the commission,
by rule, to be an interested person.
(2) The commission shall by rule adopt and publish a
definition of decisionmakers and interested persons for
purposes of this article, along with any requirements for
written reporting of ex parte communications and appropriate
sanctions for noncompliance with any rule proscribing ex parte
communications. The definition of decisionmakers shall
include, but is not limited to, each commissioner; the
attorney for the commission; the executive director of the
commission; the personal staff of a commissioner if the staff
is acting in a policy or legal advisory capacity; the chief
administrative law judge of the commission; and the
administrative law judge assigned to the proceeding. The
commission shall by rule explictly ban any communication
between an interested person and a decisionmaker regarding
which commissioner or administrative law judge may be assigned
to a matter before the commission.
(3) For adjudication cases, the rules shall provide that ex
parte communications shall be prohibited, as required by this
article. The rules shall provide that if an ex parte
communication occurs that is prohibited by this article, or if
an ex parte communication occurs in a ratesetting case,
whether initiated by a decisionmaker or an interested person,
all of the following shall be required:
(A) The interested person shall report the communication
within three working days of the communication by filing a
notice with the commission that includes all the following:
(i) The date, time, and location of the communication, whether
the communication was oral or written, or a combination of
both, and the communication medium utilized.
(ii) The identity of the decisionmaker, the identity of the
person initiating the communication, and any other persons
present.
SB 215
Page J
(iii) Topics of the communication, including applicable
proceeding numbers.
(iii) A complete description of the interested person's
communication and its content.
(iv) A copy of any written material or text used during the
communication.
(B) Any decisionmaker who participated in the communication
shall comply with both of the following:
(i) If the interested person who participated in the
communication has not timely submitted the notice required by
subparagraph (A), the decisionmaker shall refer the matter to
a commission attorney and promptly prepare and file a notice
that includes the information required by subparagraph (A) and
a complete description of the decisionmaker's communication
and its content.
(ii) If the interested person has timely submitted the
notice required by subparagraph (A), the decisionmaker shall
promptly file a notice that includes a complete description
of the decisionmaker's communication and its content and, if
appropriate, that corrects or supplements, as applicable, the
factual representations made by the interested person.
(4) The commission shall not take any vote on a matter in
which a notice of a prohibited ex parte communication has been
filed pursuant to subparagraph (A) or (B) of paragraph (3)
until all parties to the proceeding have been provided a
reasonable opportunity to respond to the communication.
(5) If an ex parte communication is not disclosed as required
by this subdivision until after the commission has issued a
decision on the matter to which the prohibited communication
pertained, a party not participating in the communication may
file a petition to rescind or modify the decision. The party
may seek a finding that the ex parte communication was
prohibited and significantly influenced the decision's process
or outcome as part of any petition to rescind or modify the
decision. The commission shall process the petition in
accordance with the commission's procedures for petitions for
modification and shall issue a decision on the petition no
later than 180 days after the filing of the petition.
(6) (A) Ex parte communications that occur at conferences that
SB 215
Page K
are related to within the scope of an adjudication or
ratesetting proceeding shall be prohibited and subject to the
disclosure requirements of this article.
(B) Ex parte communications that occur at conferences and that
are related to within the scope of a quasi-legislative
proceeding shall be governed by the ex parte communication
disclosure requirements developed by the commission.
(C) For purposes of this section, "ex parte communications
that occur at conferences" includes, but is not limited to,
communications in a private setting or during meals,
entertainment events, and tours, and informal discussions
among conference attendees.
(7) The commission shall render its decisions based on the
evidence in the record. Ex parte communications shall not be a
part of the evidentiary record of the proceedings.
(f) The commission may meet in a closed session to discuss
administrative matters so long as no collective consensus is
reached or vote taken on any matter requiring a vote of the
commissioners. The commission shall, by rule, adopt and
publish a definition of "administrative matters" for purposes
of this section.
(g) The commission shall permit written comments received from
the public to be included in the record of its proceedings ,
but the comments shall not be treated as evidence . The
commission shall provide parties to the proceeding a
reasonable opportunity to respond to any public comments
included in the record of proceedings.
(h) It is the intent of the Legislature that the commission,
and any entity or person seeking to influence actions taken by
the commission, shall be subject to all applicable ethical
standards, including any applicable obligations under the
Political Reform Act of 1974 (Title 9 (commencing with Section
81000) of the Government Code), including, but not limited to,
any applicable lobbying obligations.
SEC. 3. Section 1701.2 of the Public Utilities Code is amended
to read:
1701.2. (a) If the commission pursuant to Section 1701.1 has
determined that an adjudication case requires a hearing, the
SB 215
Page L
assigned commissioner or the assigned administrative law judge
shall hear the case in the manner described in the scoping
memo. The scoping memo shall designate whether the assigned
commissioner or the assigned administrative law judge shall
preside in the case.
(b) The commission shall provide by rule for peremptory
challenges and challenges for cause of the administrative law
judge. Challenges for cause shall include, but not be limited
to, financial interests and prejudice. The rule shall provide
that all parties are entitled to one peremptory challenge of
the assignment of the administrative law judge in all cases.
All parties are entitled to unlimited peremptory challenges in
any case in which the administrative law judge has within the
previous 12 months served in any capacity in an advocacy
position at the commission, been employed by a regulated
public utility, or has represented a party or has been an
interested person in the case.
(c) The assigned commissioner or the administrative law
judge shall prepare and file a decision setting forth
recommendations, findings, and conclusions. The decision shall
be filed with the commission and served upon all parties to
the action or proceeding without undue delay, not later than
60 days after the matter has been submitted for decision. The
decision of the assigned commissioner or the administrative
law judge shall become the decision of the commission if no
further action is taken within 30 days. Any party may appeal
the decision to the commission, provided that the appeal is
made within 30 days of the issuance of the decision. The
commission may itself initiate a review of the proposed
decision on any grounds.
(d) The commission may hold an all-party conference before a
quorum of commissioners at which all parties have an
opportunity to be heard. The commission shall adopt rules for
implementation of all-party conferences that ensure the
broadest participation by parties to the proceeding that the
commission can reasonably accommodate consistent with the
commissioners' other duties and responsibilities.
(e) The commission's decision shall be supported by findings
of fact on all issues material to the decision, and the
SB 215
Page M
findings of fact shall be based on the record developed by the
assigned commissioner or the administrative law judge. A
decision different from that of the assigned commissioner or
the administrative law judge shall be accompanied by a written
explanation of each of the changes made to the decision.
(f) Notwithstanding Section 307, an officer, employee, or
agent of the commission that is personally involved in the
prosecution or in the supervision of the prosecution of an
adjudication case before the commission shall not participate
in the decision of the case, or in the decision of any
factually related adjudicatory proceeding, including
participation in or advising the commission as to findings of
fact, conclusions of law, or orders. An officer, employee, or
agent of the commission that is personally involved in the
prosecution or in the supervision of the prosecution of an
adjudication case may participate in reaching a settlement of
the case, but shall not participate in the decision of the
commission to accept or reject the settlement, except as a
witness or counsel in an open hearing or a hearing closed
pursuant to subdivision (d). (h). The Legislature finds that
the commission performs both prosecutorial and adjudicatory
functions in an adjudication case and declares its intent that
an officer, employee, or agent of the commission, including
its attorneys, may perform only one of those functions in any
adjudication case or factually related adjudicatory
proceeding.
(g) (1) Ex parte communications shall be prohibited in
adjudication cases.
(2) Any oral or written communications concerning procedural
matters in adjudication cases between interested persons and
decisionmakers, except the assigned administrative law judge,
shall be prohibited.
(h) Notwithstanding any other law, the commission may meet
in a closed hearing to consider the decision that is being
appealed. The vote on the appeal shall be in a public meeting
and shall be accompanied with an explanation of the appeal
decision.
(i) Adjudication cases shall be resolved within 12 months of
initiation unless the commission makes findings why that
SB 215
Page N
deadline cannot be met and issues an order extending that
deadline. In the event that a rehearing of an adjudication
case is granted, the parties shall have an opportunity for
final oral argument.
(j) (1) The commission may determine that the respondent
lacks, or may lack, the ability to pay potential penalties or
fines or to pay restitution that may be ordered by the
commission.
(2) If the commission determines that a respondent lacks, or
may lack, the ability to pay, the commission may order the
respondent to demonstrate, to the satisfaction of the
commission, sufficient ability to pay potential penalties,
fines, or restitution that may be ordered by the commission.
The respondent shall demonstrate the ability to pay, or make
other financial arrangements satisfactory to the commission,
within seven days of the commission commencing an adjudication
case. The commission may delegate to the attorney to the
commission the determination of whether a sufficient showing
has been made by the respondent of an ability to pay.
(3) Within seven days of the commission's determination of the
respondent's ability to pay potential penalties, fines, or
restitution, the respondent shall be entitled to an impartial
review by an administrative law judge of the sufficiency of
the showing made by the respondent of the respondent's ability
to pay. The review by an administrative law judge of the
ability of the respondent to pay shall become part of the
record of the adjudication and is subject to the commission's
consideration in its order resolving the adjudication case.
The administrative law judge may enter temporary orders
modifying any financial requirement made of the respondent
pending the review by the administrative law judge.
(4) A respondent that is a public utility regulated under a
rate of return or rate of margin regulatory structure or that
has gross annual revenues of more than one hundred million
dollars ($100,000,000) generated within California is presumed
to be able to pay potential penalties or fines or to pay
restitution that may be ordered by the commission, and,
therefore, paragraphs (1) to (3), inclusive, do not apply to
that respondent.
SB 215
Page O
SEC. 4. Section 1701.3 of the Public Utilities Code is amended
to read:
1701.3. (a) If the commission pursuant to Section 1701.1 has
determined that a ratesetting case requires a hearing, the
procedures prescribed by subdivisions (b), (d), (f), and (i)
shall be applicable.
(b) The assigned commissioner shall determine prior to the
first hearing whether the commissioner or the assigned
administrative law judge shall be designated as the principal
hearing officer. The principal hearing officer shall be
present for more than one-half of the hearing days. The
decision of the principal hearing officer shall be the
proposed decision.
(c) An alternate decision may be issued by the assigned
commissioner or the assigned administrative law judge who is
not the principal hearing officer. Any alternate decision may
be filed with the commission and served upon all parties to
the proceeding any time prior to issuance of a final decision
by the commission, consistent with the requirements of Section
311.
(d) The commission shall establish a procedure for any party
to request the presence of a commissioner at a hearing. The
assigned commissioner shall be present at any closing
arguments in the case.
(e) The principal hearing officer shall present the proposed
decision to the full commission in a public meeting. The
alternate decision, if any, shall also be presented to the
full commission at that public meeting.
(f) The presentation to the full commission shall contain a
record of the number of days of the hearing, the number of
days that each commissioner was present, and whether the
decision was completed on time.
(g) The commission shall provide by rule for peremptory
challenges and challenges for cause of the administrative law
judge. Challenges for cause shall include, but not be limited
to, financial interests and prejudice. All parties shall be
entitled to unlimited peremptory challenges in any case in
which the administrative law judge has within the previous 12
SB 215
Page P
months served in any capacity in an advocacy position at the
commission, been employed by a regulated public utility, or
has represented a party or has been an interested person in
the case.
(h) (1) Ex parte communications in ratesetting cases are
subject to the disclosure requirements of this article. The
commission may make a formal determination prohibiting , may
prohibit ex parte communications in a ratesetting case within
90 days of the commencement of the proceeding .
(A) Oral communications may be permitted by a decisionmaker if
all parties are invited to the meeting and given not less than
three working days' notice. No individual ex parte meetings
may be held within three business days before the scheduled
date of a vote on the decision of the commission.
(B) If an ex parte communication meeting is granted to any
party, all other parties shall also be granted individual ex
parte meetings of a substantially equal period of time and
shall be sent a notice of that authorization at the time the
request is granted.
(C) Written ex parte communications by any interested person
may be permitted if copies of the communication are
transmitted to all parties on the same day as the original
communication.
(D) Written ex parte communications shall not be part of the
record of the proceeding.
(C) ( E) The commission may establish a period during which no
oral or written ex parte all-party communications may be
permitted and the commission may meet in closed session
during that period, which shall not in any circumstance exceed
14 days. If the commission holds the decision, it may permit
all-party communications during the first half of the interval
between the hold date and the date that the decision is
calendared for final decision. The commission may meet in
closed session for the second half of that interval.
(2) Oral communications concerning a procedural matter in
ratesetting cases between interested persons and
decisionmakers, except the assigned administrative law judge,
are prohibited, except that an oral communication may be
permitted at any time by any decisionmaker if all parties are
SB 215
Page Q
invited and given not less than three working days' notice.
(3) Written communications concerning a procedural matter in
ratesetting cases between interested persons and
decisionmakers, except the assigned administrative law judge,
are prohibited, except that a decisionmaker may permit a
written communication by any party if copies of the
communication are transmitted to all parties on the same day.
(i) Any party has the right to present a final oral argument
of its case before the commission. Those requests shall be
scheduled in a timely manner. A quorum of the commission shall
be present for the final oral arguments.
(j) After the issuance of a proposed decision in a ratesetting
case, the commission may hold an all-party conference before a
quorum of commissioners at which all parties have an
opportunity to be heard. The commission shall adopt rules for
implementation of all-party conferences that ensure the
broadest participation by parties to the proceeding that the
commission can reasonably accommodate consistent with the
commissioners' other duties and responsibilities.
(k) The commission may, in issuing its decision, adopt,
modify, or set aside the proposed decision or any part of the
decision based on evidence in the record. The final decision
of the commission shall be issued not later than 60 days after
the issuance of the proposed decision. Under extraordinary
circumstances the commission may extend this date for a
reasonable period. The 60-day period shall be extended for 30
days if any alternate decision is proposed pursuant to Section
311.
SEC. 5. Section 1701.4 of the Public Utilities Code is
amended to read:
1701.4. (a) If the commission pursuant to Section 1701.1 has
determined that a quasi-legislative case requires a hearing,
the procedures prescribed by subdivisions (b) and (d) to (f),
inclusive, shall be applicable.
(b) The assigned administrative law judge and any assigned
technical advisory staff shall act as an assistant to the
assigned commissioner in quasi-legislative cases. The assigned
commissioner shall prepare the proposed rule or order with the
SB 215
Page R
assistance of the administrative law judge and any assigned
technical advisory staff. The assigned commissioner shall
present the proposed rule or order to the full commission in a
public meeting. The report shall include the number of days of
hearing and the number of days that the commissioner was
present.
(c) Ex parte communications in quasi-legislative proceedings
are permitted and not subject to the disclosure requirements
of this article, except when the commission, within 90 days of
the commencement of a quasi-legislative proceeding, makes a
formal determination of by order or ruling , either of the
following.
(1) That ex parte communications are subject to the disclosure
requirements of this article.
(2) That ex parte communications are prohibited and subject to
the disclosure requirements of this article.
(d) Any party has the right to present a final oral argument
of its case before the commission. Those requests shall be
scheduled in a timely manner. A quorum of the commission shall
be present for the final oral arguments.
(e) After the issuance of a proposed decision in a
quasi-legislative case, the commission may hold an all-party
conference before a quorum of commissioners at which all
parties have an opportunity to be heard. The commission shall
adopt rules for implementation of all-party conferences that
ensure the broadest participation by parties to the proceeding
that the commission can reasonably accommodate consistent with
the commissioners' other duties and responsibilities.
(f) The commission may, in issuing its rule or order, adopt,
modify, or set aside the proposed decision or any part of the
rule or order. The final rule or order of the commission shall
be issued not later than 60 days after the issuance of the
proposed rule or order. Under extraordinary circumstances the
commission may extend this date for a reasonable period. The
60-day period shall be extended for 30 days if any alternate
rule or order is proposed pursuant to Section 311.
SEC. 6. Section 1701.5 of the Public Utilities Code is amended
to read:
SB 215
Page S
1701.5. (a) Except as specified in subdivision (b), in a
ratesetting or quasi-legislative case, the commission shall
resolve the issues raised in the scoping memo within 18 months
of the date the proceeding is initiated, unless the
commission makes a written determination that the deadline
cannot be met, including findings as to the reason, and issues
an order extending the deadline.
(b) Notwithstanding subdivision (a), the commission may
specify in a scoping memo a resolution date later than 18
months from the date the proceeding is initiated, if that
scoping memo includes specific reasons for the necessity of a
later date and the commissioner assigned to the case approves
the date.
SEC. 7. Section 1701.6 is added to the Public Utilities Code,
to read:
1701.6. (a) In addition to any penalty, fine, or other
punishment applicable pursuant to Article 11 (commencing with
Section 2100), the commission may assess civil sanctions upon
any entity or person, other than a decisionmaker or employee
of the commission, who violates, fails to comply with, or
procures, aids, or abets any violation of, the ex parte
communication requirements of this article or those adopted by
the commission pursuant to this article. The civil sanctions
may include civil penalties, adverse consequences in
commission proceedings, or other appropriate commission orders
directed at the entity, person, or both the entity and person,
committing the violation.
(b) (1) Except as provided in paragraph (2), a civil penalty
assessed shall not exceed fifty thousand dollars ($50,000) per
violation. Each day of a continuing violation is a separate
violation. If the violation consists of engaging in a
communication that is prohibited by the ex parte communication
requirements, each day that the violation is not disclosed to
the commission and to parties of record in the formal
proceeding in which the communication occurred shall
constitute a separate violation.
(2) If the entity or person may obtain, by violating the ex
parte communication requirements, financial benefits that
SB 215
Page T
exceed the maximum amount of civil penalty allowable pursuant
to paragraph (1), the commission may impose a civil penalty up
to the amount of those financial benefits.
(c) Civil penalties assessed pursuant to subdivision (b) upon
entities whose rates are determined by the commission shall be
in the form of credits to the customers of that entity. Civil
penalties collected from other entities shall be deposited in
the General Fund.
(d) In determining the appropriate civil sanctions, the
commission shall consider the following factors:
(1) The severity of the violation.
(2) The conduct of the entity or person, including the level
of experience of the entity or person in participating in
commission proceedings and whether the entity or person
knowingly violated the ex parte communication requirements.
(3) The financial resources of the entity or person.
(4) The totality of the circumstances in furtherance of the
public interest.
SEC. 8. Section 1701.7 is added to the Public Utilities Code,
to read:
1701.7. (a) The Attorney General may bring an enforcement
action in superior court against a decisionmaker or employee
of the commission who violates, fails to comply with, or
procures, aids, or abets any violation of, the ex parte
communication requirements in this article or those adopted by
the commission pursuant to this article.
(b) Notwithstanding Section 1759, in an enforcement action
brought pursuant to this section, the court may grant
appropriate relief, including disqualification of the
decisionmaker from one or more proceedings and civil penalties
as provided in Section 2111.
(c) In determining the appropriate relief, the court may
consider the following factors:
(1) The severity of the violation.
(2) The conduct of the decisionmaker or employee, including
whether the decisionmaker or employee knowingly violated the
ex parte communication requirements.
(3) The financial resources of the decisionmaker or employee.
SB 215
Page U
(4) The totality of the circumstances in furtherance of the
public interest.
(d) The Attorney General may compromise the enforcement action
subject to approval by the court.
(e) Civil penalties collected pursuant to this section shall
be deposited into the Litigation Deposits Fund established
pursuant to Article 9 (commencing with Section 16425) of
Chapter 2 of Part 2 of Division 4 of Title 2 of the Government
Code.
4)Support and Opposition:
Supporters state that reforms in this bill represent important
first steps to restore public confidence in the ability of the
CPUC to make fair and open decisions on a wide array of public
utility issues that effect virtually all California residents
and businesses.
Opponents state that, if enacted, SB 215 will "simply enhance
the already significant advantage the large utilities enjoy in
the CPUC process" and render it virtually impossible for
participants in most proceedings to communicate with
decisionmakers at the CPUC.
Other opponents are concerned that it will be impossible to
convene an all-party meeting due to the logistical problems
associated with convening a meeting with all commissioners in
attendance.
REGISTERED SUPPORT / OPPOSITION:
SB 215
Page V
Support
California Emerging Technology Fund
National Diversity Coalition
The Utility Reform Network
Opposition
California Cogeneration Council
California Water Association (unless amended)
California Large Energy Consumers Association
Commercial Energy of California
Goodin, MacBride, Squeri & Day (unless amended)
Analysis Prepared by:Sue Kateley / U. & C. / (916)
319-2083
SB 215
Page W