BILL ANALYSIS                                                                                                                                                                                                    Ó



                                                                     SB 512


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          Date of Hearing:  June 29, 2016


                    ASSEMBLY COMMITTEE ON UTILITIES AND COMMERCE


                                  Mike Gatto, Chair


          SB  
          512 (Hill) - As Amended June 20, 2016


          SENATE VOTE:  37-0


          SUBJECT:  Public Utilities Commission


          SUMMARY: Makes various changes to processes to provide improved  
          transparency of California Public Utilities Commission (CPUC)  
          activities and make revisions to rules governing intervenor  
          compensation to allow local governments to receive such  
          compensation, as specified.  Specifically, this bill:  


          1)Requires the CPUC to hold its sessions at least once in each  
            calendar month, without specifying the location.


          2)Makes the Administrative Adjudication Code of Ethics  
            applicable to administrative law judges of the CPUC. 


          3)Requires, except in adjudication cases, the CPUC, before  
            determining the scope of the proceeding, where feasible and  
            appropriate, to seek the   participation of those who are likely  
            to be affected by a decision in the proceeding. 









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          4)Requires the Policy and Planning Division of the CPUC to  
            undertake one or more studies of outreach efforts undertaken  
            by other state and federal utility regulatory bodies and to  
            make recommendations to the commission to promote effective  
            outreach, including metrics for use in evaluating success. 


          5)Requires the CPUC to include a docket card that lists the  
            public versions of all prepared oral and written testimony and  
            advice letter filings, protests, and responses on its Internet  
            Web site. 


          6)Requires the CPUC to make additional information available on  
            the Internet, including information on how members of the  
            public and ratepayers can gain access to the CPUC's ratemaking  
            process.


          7)Requires the CPUC to develop, publish, and annually update a  
            report on public meetings held outside San Francisco in the  
            previous year and a schedule of meetings anticipated to be  
            held outside San Francisco during the upcoming year.


          8)Expands the CPUC's current annual workplan report to described  
            all scheduled proceedings that may be considered by the CPUC  
            during the calendar year and require inclusion of  performance  
            criteria for the CPUC and executive director..


          9)Permits intervenor compensation to be paid to certain local  
            government entities that intervene or participate in  
            commission proceedings to the extent that their involvement  
            was for the purpose of protecting health and safety, under  
            specified circumstances. 










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          EXISTING LAW:   


          1)Establishes the CPUC with five members appointed by the  
            Governor and confirmed by the Senate and empowers it to  
            regulate privately owned public utilities in California.   
            (California Constitution Article XII; Public Utilities Code  
            Section 301 et seq.)
          2)Requires the office of the CPUC to be located in the City and  
            County of San Francisco. Requires the CPUC to hold at least  
            one session per calendar month in the City and County of San  
            Francisco.  (Public Utilities Code Section 306) 


          3)Requires the CPUC to publish and maintain on its website  
            specified information, including a docket card that lists all  
            documents filed and all decisions or rulings issued in those  
            proceedings, as provided.  (Public Utilities Code Section  
            311.5)


          4)Requires the CPUC to develop, publish and annually update an  
            annual workplan report that describes the scheduled ratemaking  
            proceedings and other decisions that may be considered during  
            the calendar year, along with other specified information to  
            be included in the workplan report.  (Public Utilities Section  
            910)


          5)Requires the CPUC to annually submit a report to the  
            Legislature on the number of cases where resolution exceeded  
            the time periods prescribed in scoping memos and days that  
            commissioners presided in hearings.  (Public Utilities Code  
            Section 910.1)










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          6)Exempts the CPUC from the California Administrative Procedures  
            Act.  (Public Utilities Code Section 1701)


          7)Provides compensation for reasonable advocate's fees,  
            reasonable expert witness fees, and other reasonable costs to  
            public utility customers of participation or intervention in  
            any proceeding of the commission. (Public Utilities Code  
            Section1801 et seq.)


          FISCAL EFFECT:  Unknown.


          COMMENTS:  


          1)Author's Statement. "Recent scandals at the California Public  
            Utilities Commission (CPUC) have highlighted the need for more  
            visibility in the interactions between Commissioners and  
            regulated utilities, and a series of embarrassing audits of  
            the CPUC's mismanagement of public funds poor safety oversight  
            point toward poor management of the organization.


            "SB 512 would reform the CPUC's governance structure, more  
            clearly outlining the roles and responsibilities of  
            Commissioners and staff, and it would end loopholes that allow  
            regulated utilities to influence CPUC Commissioners outside  
            the public eye."


          2)Background. This bill addresses several areas of CPUC reform:


             a)   Performance criteria for the commission and the  
               executive director and annually evaluate the performance of  
               the executive director based on those criteria;









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             b)   Allows the CPUC to meet anywhere, not just in San  
               Francisco;


             c)   Requires the CPUC to modify its annual report to list  
               its schedule of future rulemakings and report on the  
               timeliness of proceedings so that it says how long  
               proceedings have lasted;


             d)   Requires administrative law judges to adhere to ethics  
               provisions of the Administrative Procedures Act;


             e)   Requires testimony-oral and written-to be docketed on  
               the CPUC's Web site;


             f)   Requires the CPUC to perform outreach to affected groups  
               before opening a commission-instigated proceeding, and  
               requires them to outline the efforts in the opening  
               document of the proceeding;


             g)   Permits local government agencies that have been subject  
               to a utility catastrophe and consortia of local government  
               entities to receive intervenor compensation for  
               safety-related intervention.


            When current CPUC President Picker addressed his colleagues  
            and CPUC staff in January 2015 he stated: 


               "We will move the agency forward with openness and  
               transparency.










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               "Re-building the CPUC into an organization that is more  
               fair, open, accessible, and effective must start at the  
               top." 


            This bill provides authority to enable the CPUC to implement  
            those actions that will move the CPUC toward openness and  
            transparency. In addition, by providing performance criteria  
            and review and information about the proceedings, the public  
            can be participate more effectively in CPUC proceedings.


            With regard to intervenor compensation, the City of San Bruno  
            stated in its letter:


                     As we embarked on our participation in three  
                     investigations related to the explosion in our  
                     community we were shocked to discoverer  
                     that?.such compensation it not available to  
                     local government organizations like ours.  
                     Cities and counties that have suffered  
                     catastrophe are least able to devote their  
                     limited resource to the arcane and expensive  
                     task of participation in CPUC proceedings -  
                     they have more than enough to do to just  
                     respond, to address the needs of their  
                     residents and to rebuild and recover.


            As written, this bill is unclear that the communities eligible  
            for intervenor compensation would have suffered a catastrophic  
            loss and that the loss is related to utility infrastructure.  
             The author may wish to consider a clarifying amendment to  
            address this.  


          3) Proposed amendments:









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            d) "Eligible local government entity" means either of the  
            following:


            (1) A local government entity that is not a publicly owned  
            public utility that intervenes or participates in a commission  
            proceeding for the purpose of protecting the health and safety  
            of the residents within the entity's jurisdiction after  
            suffering a  catastrophic  material loss, either in significant  
            damage to infrastructure or loss of life and property  or both  ,  
            as a  direct  result of public utility infrastructure.


            (2) A consortium of local governmental entities that intervene  
            or participate in a commission proceeding for the purpose of  
            protecting public health and safety  through prevention of  
            material loss, either in significant damage to infrastructure  
            or loss of life and property, as a result of public utility  
            infrastructure  .



            1802.4. An eligible local government entity is eligible for an  
            award of compensation pursuant to this article for its  
            involvement to the extent that the involvement was for the  
            purpose of protecting health and safety and consistent with  
            subdivision (d) of Section 1802. The eligibility of a local  
            government entity described by paragraph (1) of subdivision  
            (d) of Section 1802, shall be for involvement to the extent  
            that the involvement was germane to the material loss suffered   
            and to improving safety within the entity's jurisdiction  .

          4) Support and Opposition:


            Supporters state that transcripts are necessary and integral  
            to the development of a complete record in CPUC proceedings  
            and that parties must have timely access to the transcripts in  








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            order to support positions taken in briefs, comments or other  
            documents submitted in the proceedings


            With respect to intervenor compensation, supporters state that  
            local governments who have suffered catastrophic losses to  
            seek intervenor compensation.


            Opponents state that local governments have the power to raise  
            revenue or prioritize workload to cover their operational  
            expenses for the direct benefit of their constituents to  
            advocate in CPUC proceedings. They believe it is inappropriate  
            to ask utility customers to indirectly subsidize the  
            activities of a local government or consortia of local  
            government entities.


          5) Related Legislation:


            SB 215 (Leno) of 2016: Enacts various reforms to existing law  
            to address issues of governance, transparency, and  
            accountability at the CPUC. Pending in the Assembly.


            AB 2120 (Weber) of 2016: Expands eligibility for intervenor  
            compensation to consortia of school districts. Pending in the  
            Senate.


            ACR 11 (Gatto) of 2016: Places a measure on the ballot to  
            author Legislature to reform the CPUC functions. Pending in  
            the Senate.


            SB 48 (Hill) of 2015: Contained provisions related to judicial  
            review of Public Records Act and Bagley-Keene Open Meeting  
            Act. Vetoed by the Governor.








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            SB 660 (Leno) of 2015: Restricted the use of ex parte  
            communications in ratesetting and quasi-legislative  
            proceedings. Vetoed by the Governor.


            SB 825 (Rendon) of 2015: Created an inspector general for the  
            CPUC, required the CPUC to publish more information, codified  
            procedures in proceedings regarding the release of  
            utility-furnished documents, increased the use of all-part  
            meetings, and made other changes. Vetoed by the Governor.


            SB 1165 (Wright) of 2012: Allowed intervenor compensation to  
            be awarded for participation or intervention in proceedings at  
            the CPUC for a county office of education, on behalf of any of  
            the local educational agencies in whole or part within the  
            county or on behalf of itself, or for a community college  
            district. Died in the Senate Appropriations Committee.


            AB 1973 (Ruskin) of 2008: Required Senate confirmation of the  
            Governor-appointed president of the CPUC, and had the  
            executive director and attorney take direction from the  
            commission rather than the president. Died on the Assembly  
            Floor.


            SB 532 (Kopp), Chapter 938, Statutes of 1995: Revised  
            procedures for administrative procedures by, among other  
            things, requiring that all state adjudicative proceedings  
            adhere to an "administrative adjudication bill of rights,"  
            which would promote greater due process, fairness,  
            accessibility, objectivity and consistency in adjudicative  
            proceedings.  This bill exempted the CPUC from its  
            requirements.










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          REGISTERED SUPPORT / OPPOSITION:




          Support


          California Farm Bureau


          California Public Utilities Commission (if amended)


          City of Carmel by the Sea


          City of Laguna Beach


          City of San Bruno


          Sierra Club




          Opposition


          AT&T 


          California Cable & Telecommunications Association (CCTA)


          California Water Association (unless amended)









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          CTIA


          Consolidated Communications


          Sprint


          T-Mobile


          Verizon




          Analysis Prepared by:Sue Kateley / U. & C. / (916)  
          319-2083