BILL ANALYSIS Ó
SB 512
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SENATE THIRD READING
SB
512 (Hill)
As Amended August 19, 2016
Majority vote
SENATE VOTE: 37-0
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|Committee |Votes|Ayes |Noes |
| | | | |
| | | | |
| | | | |
|----------------+-----+-----------------------+---------------------|
|Utilities |10-2 |Gatto, Burke, Eggman, |Dahle, Obernolte |
| | | | |
| | | | |
| | |Cristina Garcia, | |
| | |Hadley, | |
| | | | |
| | | | |
| | |Roger Hernández, | |
| | |Quirk, Santiago, Ting, | |
| | |Williams | |
| | | | |
|----------------+-----+-----------------------+---------------------|
|Appropriations |12-2 |Gonzalez, Bloom, |Bigelow, Obernolte |
| | |Bonilla, Bonta, Chang, | |
| | |Eggman, | |
| | | | |
| | | | |
SB 512
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| | |Eduardo Garcia, Quirk, | |
| | |Santiago, Weber, Wood, | |
| | |McCarty | |
| | | | |
| | | | |
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SUMMARY: Makes a variety changes to the operations and
governance of the California Public Utilities Commission (CPUC).
Specifically, this bill:
1)Requires the CPUC to hold its sessions at least once in each
calendar month, without specifying the location.
2)Applies the Administrative Adjudication Codes of Ethics to
CPUC administrative law judges.
3)Requires the CPUC 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 CPUC Policy and Planning Division to study the
outreach efforts undertaken by other state or federal utility
regulatory bodies and make recommendations.
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
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the Internet, including information on how members of the
public and ratepayers can gain access to the CPUC'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 CPUC during the calendar year, the
outcomes, and the performance criteria for the CPUC 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.
9)Clarifies that intervenor compensation, in proceedings at the
CPUC, is allowed for intervenors who made a substantial
contribution in a proceeding, regardless of whether or not a
settlement is reached.
FISCAL EFFECT: According to the Assembly Appropriations
Committee, increased CPUC 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
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participated in CPUC proceedings during any given year.
COMMENTS
1)Purpose: According to the author, recent scandals at the 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 and poor safety oversight point
toward poor management of the organization. This bill is
intended to reform the CPUC's governance structure by clearly
outlining the roles and responsibilities of Commissioners and
providing transparency and accountability.
2)Background: The CPUC 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 CPUC
regulates privately-owned electric, natural gas,
telecommunications, water, railroad, rail transit, and
passenger transportation companies. CPUC 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 CPUC official
filings, including maintenance of the official record of
proceedings.
3)CPUC Deficiencies: The CPUC 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
CPUC's ability to manage its core functions. An audit by the
State Auditor in March of 2014 found the CPUC lacks adequate
process for the sufficient oversight of utility balancing
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accounts to protect ratepayers from unfair rate increases.
A recent report commissioned by the CPUC 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.
4)Intervenor Compensation for Local Governments: 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 discover
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.
This bill would make communities eligible for intervenor
compensation that have suffered a catastrophic loss related to
utility infrastructure.
5)Intervenor Compensation When No Settlement is Reached. This
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bill clarifies that compensation is allowed for intervenors
who made a substantial contribution in a proceeding,
regardless of whether or not a settlement is reached. This
provision is intended to end the era of "go-along, get-along,"
a practice instituted by former-CPUC President Peevey to
encourage intervenors to enter into settlements in order to
receive intervenor compensation. Those who did not settle
would not be deemed to have made a substantial contribution
and then, therefore, ineligible for intervenor compensation,
whether or not their contribution was, indeed, substantial.
Analysis Prepared by:
Sue Kateley / U. & C. / (916) 319-2083 FN:
0004663