BILL ANALYSIS Ó
SB 512
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Date of Hearing: August 10, 2016
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Lorena Gonzalez, Chair
SB 512
(Hill) - As Amended August 3, 2016
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|Policy |Utilities and Commerce |Vote:|10 - 2 |
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Urgency: No State Mandated Local Program: YesReimbursable:
No
SUMMARY:
This bill makes a variety changes to the operations and
governance of the California Public Utilities Commission (PUC).
Specifically, this bill:
1)Requires the PUC to hold its sessions at least once in each
calendar month, without specifying the location.
2)Applies the Administrative Adjudication Codes of Ethics to PUC
administrative law judges.
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3)Requires the PUC to seek the participation of those likely to
be affected by a decision, prior to determining the scope of a
proceeding. This provision does not apply to adjudication
cases.
4)Requires the PUC Policy and Planning Division to study the
outreach efforts undertaken by other state or federal utility
regulatory bodies and make recommendations.
5)Requires the PUC 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 PUC to make additional information available on
the Internet, including information on how members of the
public and ratepayers can gain access to the PUC's ratemaking
process.
7)Expands and recasts an existing annual reporting requirement
to the Governor and Legislature to include, among other
things, the description of all scheduled proceedings that may
be considered by the PUC during the calendar year, the
outcomes, and the performance criteria for the PUC and the
executive director.
8)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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FISCAL EFFECT:
Increased PUC costs of up to $1.1 million annually (Public
Utilities Reimbursement Account) to comply with the provisions
of the bill.
Most of the costs are associated with providing intervenor fees
to local governments, in particular, determining eligibility.
According to the Legislative Analyst's Office, there are over
5,300 local government agencies. This is more than 100 times
greater than the number of eligible intervenors that
participated in PUC proceedings during any given year.
COMMENTS:
1)Purpose. According to the author, recent scandals at the PUC
have highlighted the need for more visibility in the
interactions between Commissioners and regulated utilities,
and a series of embarrassing audits of the PUC's mismanagement
of public funds and poor safety oversight point toward poor
management of the organization. This bill is intended to
reform the PUC's governance structure by clearly outlining the
roles and responsibilities of Commissioners and providing
transparency and accountability.
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, and
staffed by approximately 1,000 individuals. The PUC regulates
privately-owned electric, natural gas, telecommunications,
water, railroad, rail transit, and passenger transportation
companies. PUC staff includes four personal advisors to each
of four Commissioners, five to the President. Additional
staff include 42 judges of the Administrative Law Division
and numerous attorneys, engineers and accountants who prepare
the docket for all PUC official filings, including maintenance
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of the official record of proceedings.
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.
This bill addresses audit findings of mismanagement, poor
safety oversight, and failed governance.
Analysis Prepared by:Jennifer Galehouse / APPR. / (916)
319-2081
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