BILL ANALYSIS                                                                                                                                                                                                    

                                                                     SB 631

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          Date of Hearing:  June 15, 2015


                                Anthony Rendon, Chair

          631 (Hueso) - As Introduced February 27, 2015

          SENATE VOTE:  29-4

          SUBJECT:  Public Utilities Commission: fees.

          SUMMARY:  This bill specifies that the fee for filing a  
          certificate of public convenience and necessity (CPCN) with the  
          Public Utilities Commission (CPUC) is an amount not to exceed  
          $500 and allows the CPUC to adjust this fee for inflation.   
          Specifically, this bill:  

          a)Caps the amount the CPUC can assess for a CPCN to no more than  
            $500 and allows the fee to continue to be adjusted based on  
            the Consumer Price Index. 

          b)Repeals a section of the statute which requires collected CPCN  
            application fees to be paid to the credit of the General Fund.  

          EXISTING LAW:   


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          1)Requires a utility, including telephone corporations, to  
            obtain a CPCN from the CPUC prior to construction or extension  
            of a line or service.  (Public Utilities Code Section 1001)

          2)Establishes a fee of $75 for the application of a CPCN.   
            (Public Utilities Code Section 1904)

          FISCAL EFFECT:  Unknown.


           1)Background:   A CPCN is a permit issued by the CPUC to a  
            utility that wants to provide service or construct or extend  
            facilities or telecommunications services.  For example, a  
            CPCN is required for a natural gas utility that plans to  
            extend a transmission line.  A fee on CPCN applications was  
            established in statute in 1969.  The CPCN application process  
            involves the participation of an administrative law judge,  
            CPUC staff, and commissioners, and is a lengthy and in-depth  
            public process.  It involves review of California  
            Environmental Quality Act documents, cost analysis, need  
            analysis, and extensive workshops and public hearings.  

           2)Purpose:   According to the supporters of the bill, the costs  
            of processing a CPCN application are not well reflected in the  
            $75 fee established in law nearly half a century ago.   
            However, the CPUC does not have authority to revise the  
            application fee without a change in the statute.  In 2013, the  
            CPUC adopted Decision (D.) 13-05-035 which acknowledged the  
            need to increase the CPCN fee with legislative approval.  In  
            that decision, the CPUC stated that had the application fee  


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            been adjusted for inflation, the 2013 fee would have been  

           3)Prior Legislation:  

            SB 711 (Padilla) 2014:  Proposed to authorize the CPUC to  
            increase the CPCN application fee to an amount that would  
            reasonably cover the costs of processing the fee with a cap of  
            $500.  The bill also proposed to shift the revenues from the  
            application fee from the General Fund to the CPUC.  The bill  
            was held in the Assembly Committee on Utilities and Commerce.   

            AB 1409 (Bradford) 2013:  Proposed several changes to the  
            Public Utilities Code, including increasing the CPCN  
            application fee.  The bill was vetoed by the Governor. 



          California Public Utilities Commission



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          None on file. 

          Analysis Prepared by:Allegra Roth / U. & C. / (916)