Amended in Assembly August 19, 2015

Amended in Assembly August 18, 2015

Amended in Assembly July 7, 2015

Amended in Senate May 6, 2015

Amended in Senate April 15, 2015

Senate Bill No. 660

Introduced by Senators Leno and Hueso

February 27, 2015

An act to amend Sections begin delete 305, 307, end delete 308, 309.6, 1701.1, 1701.2, 1701.3, begin delete and 1701.4 end delete begin insert 1701.4, and 1701.5 end insert of, and to add Sections 305.5, begin insert 307.5, end insert 1701.6, begin delete and 1701.7 end delete begin insert 1701.7, and 1701.8 end insert to, the Public Utilities Code, relating to the Public Utilities Commission.

LEGISLATIVE COUNSEL’S DIGEST

SB 660, as amended, Leno. Public Utilities Commission.

(1) The California Constitution establishes the Public Utilities Commission, with jurisdiction over all public utilities. The California Constitution grants the commission certain general powers over all public utilities, subject to control by the Legislature, and authorizes the Legislature, unlimited by the other provisions of the California Constitution, to confer additional authority and jurisdiction upon the commission that is cognate and germane to the regulation of public utilities. Existing law requires the Governor to designate the president of the commission from among its members and requires the president to direct the executive director, the attorney, and other staff of the commission, except for the Office of Ratepayer Advocates. begin delete Existing law authorizes the executive director and the attorney to undertake certain actions if directed or authorized by the president, except as otherwise directed or authorized by vote of the commission. end delete

This bill would begin delete repeal the requirement that the president direct the executive director, the attorney, and other commission staff. The bill would delete the authority of the president to direct or authorize the executive director and attorney to undertake certain actions, and would instead require that they be directed or authorized to undertake those actions by the commission. The bill would end delete authorize the commission to delegate specific management and internal oversight functions to committees composed of 2 commissioners. begin delete The bill would require the commission to vote in an open meeting on the assignment or reassignment of proceeding to one or more commissioners. end delete begin insert The bill would require the commission to appoint a chief administrative law judge who would be responsible for the commission’s executive and administrative management and oversight of the administrative law judge division and would require the chief administrative law judge to organize, coordinate, supervise, and direct the operations of the administrative law judge division as directed by the commission, consistent with commission policies and priorities. end insert

begin insert

Existing law requires the executive director to keep a full and true record of all proceedings of the commission.

end insert begin insert

This bill would delete that requirement and would instead require the chief administrative law judge to keep a full and true record of all proceedings of the commission.

end insert

(2) Existing law requires the commission, upon initiating a hearing, to assign one or more commissioners to oversee the case and an administrative law judge, where appropriate. Existing law requires the assigned commissioner to prepare and issue, by order or ruling, a scoping memo that describes the issues to be considered and the applicable timetable for resolution. Existing law requires the commission to adopt procedures on the disqualification of administrative law judges due to bias or prejudice similar to those of other state agencies and superior courts.

This bill would require the commission to additionally adopt procedures on disqualification of commissioners due to bias or prejudice similar to those of other state agencies and superior courts. For ratesetting or adjudicatory proceedings, the bill would require a commissioner or an administrative law judge to be disqualified begin delete if there is an appearance of end delete begin insert for end insert bias or prejudice based on specified criteria. The bill would require that the commission procedures prohibit a commissioner or administrative law judge from ruling on a motion made by a party to a proceeding to disqualify the commissioner or administrative law judge due to bias or prejudice.

(3) The Public Utilities Act requires the commission to determine whether a proceeding requires a hearing and, if so, to determine whether the matter requires a quasi-legislative, an adjudication, or a ratesetting hearing. For these purposes, quasi-legislative cases are cases that establish policy rulemakings and investigations, which may establish rules affecting an entire industry, adjudication cases are enforcement cases and complaints, except those challenging the reasonableness of any rates or charges, and ratesetting cases are cases in which rates are established for a specific company, including general rate cases, performance-based ratemaking, and other ratesetting mechanisms. The act regulates communications in hearings before the commission and defines “ex parte communication” to mean any oral or written communication between a decisionmaker and a person with an interest in a matter before the commission concerning substantive, but not procedural, issues that does not occur in a public hearing, workshop, or other public proceeding, or on the official record of the proceeding on the matter. Existing law defines “person with an interest” to mean, among other things, a person with a financial interest 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. Existing law requires the commission, by regulation, to adopt and publish a definition of the terms “decisionmaker” and “persons” for those purposes, along with any requirements for written reporting of ex parte communications and appropriate sanctions for noncompliance with any rule proscribing ex parte communications. The act provides that ex parte communications are prohibited in adjudication cases and are prohibited in ratesetting cases, with certain exceptions. The act requires that ex parte communications be permitted in quasi-legislative cases, without any restrictions. The commission’s Rules of Practice and Procedure define a “decisionmaker” as any commissioner, the Chief Administrative Law Judge, any Assistant Chief Administrative Law Judge, the assigned administrative law judge, or the Law and Motion Administrative Law Judge. The Rules of Practice and Procedure provide that communications with a commissioner’s personal advisors are subject to all of the restrictions on, and reporting requirements applicable to, ex parte communications, except that oral communications with an advisor in ratesetting proceedings are permitted without the restrictions.

This bill would begin insert require that the commission determine whether every proceeding, not just those requiring a hearing, is a quasi-legislative, adjudication, or ratesetting proceeding. The bill would end insert delete the provision that an ex parte communication concerns a substantive, but not a procedural matter, and instead would provide that an ex parte communication concerns any matter that the commission has not specified in its Rules of Practice and Procedure as being a procedural begin insert 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 end insert matter. The bill would prohibit the commission from considering as a procedural matter communications between an interested person and a decisionmaker regarding which commissioner or administrative law judge may be assigned to a matter before the commission. The bill would define a person involved in issuing credit ratings or advising entities or persons who may invest in the shares or operations of any party to a proceeding as an interested person. The bill would require that the commission, by rule, adopt and publish a definition of decisionmakers, that would be required to include certain individuals in the commission. The bill would require begin delete decisionmakers to periodically report summary logs of ex parte communications with interested persons in compliance with rules established by the commission, and included in the commission’s Rules of Practice and Procedure, and end delete begin insert the commission to establish and maintain a communications log summarizing all oral or written ex parte communications that occur between an interested person and the commission, 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, or the administrative law judge assigned to the proceeding. The bill end insert would require the commission to post begin delete those summary logs end delete begin insert the communications log end insert on its Internet Web site.

This bill would require that a decisionmaker, in an adjudication or ratesetting case, who makes or receives a prohibited ex parte communication, or who receives an ex parte communication that was not timely reported, to disclose certain information regarding the communication in the record of the proceeding before the commission takes a vote on the matter. begin insert If a prohibited ex parte communication is not disclosed until after the commission has issued a decision on the matter to which the communication pertained, a party not participating in the communication would be authorized to file a petition to rescind or modify the decision. end insert The bill would require the commission to render decisions based upon the record in a case and would provide that an ex parte communication not be part of the record of the proceeding.

This bill would provide that ex parte communications are permitted in quasi-legislative proceedings, but would require that they be reported within 3 working days begin delete of the communication by filing a “Notice of Ex Parte Communication” with the commission in accordance with procedures established by the commission for the service of that notice and containing specified information. end delete begin insert in the communications log maintained by the commission. end insert

This bill would require the commission to additionally prohibit communications concerning procedural issues in adjudication cases between parties or persons with an interest and decisionmakers, except for the assigned administrative law judge.

Under existing law, the exceptions to the prohibition upon ex parte communications in ratesetting proceedings authorize a commissioner to permit oral ex parte communications if all interested parties are invited and given not less than 3 days’ notice. If an ex parte communication meeting is granted to any party, it is required that all other parties also be granted individual ex parte meetings of a substantially equal period of time and that all parties be sent a notice of that authorization at the time the request is granted, at least 3 days prior to the meeting. The exceptions authorize a commissioner to permit written ex parte communications by any party provided that copies of the communication are transmitted to all parties.

This bill would delete the requirement that if an ex parte communication meeting is granted to any party in a ratesetting proceeding, that all other parties also be granted individual ex parte meetings of a substantially equal period of time and that all parties be sent a notice of that authorization at the time the request is granted, at least 3 days prior to the meeting. The bill would prohibit oral communications concerning procedural matters in ratesetting cases between parties or persons with an interest and decisionmakers other than the assigned administrative law judge, except that a commissioner would be authorized to permit an oral communication relative to procedural matters if all interested parties are invited and given not less than 3 days’ notice. The bill would prohibit written ex parte communications concerning procedural matters in ratesetting cases between parties or persons with an interest and decisionmakers other than the assigned administrative law judge, except that a commissioner would be authorized to permit a written communication relative to procedural issues by any party provided that copies of the communication are transmitted to all parties on the same day.

begin insert

This bill would expressly make the prohibitions upon ex parte communications that relate to adjudicatory or ratesetting proceedings applicable to ex parte communications that occur at conferences, as defined. The bill would also make the requirements that pertain to ex parte communications that relate to quasi-legislative proceedings applicable to ex parte communications that occur at conferences.

end insert

This bill would authorize the commission to impose civil sanctions, including civil penalties, on any entity or person, other than a decisionmaker or employee of the commission, that violates ex parte communication requirements. The bill would authorize the Attorney General to bring an enforcement action in the Superior Court of the City and County of San Francisco against a decisionmaker or employee of the commission who violates the ex parte communication requirements.

Under existing law, a violation of the Public Utilities Act or any order, decision, rule, direction, demand, or requirement of the commission is a crime.

Because the provisions of this bill would be a part of the act and because a violation of an order or decision of the commission implementing its requirements would be a crime, the bill would impose a state-mandated local program by expanding the application of a crime.

The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.

This bill would provide that no reimbursement is required by this act for a specified reason.

Vote: majority. Appropriation: no. Fiscal committee: yes. State-mandated local program: yes.

The people of the State of California do enact as follows:

begin delete

SECTION 1.  

Section 305 of the Public Utilities Code is
amended to read:

305.  

The Governor shall designate a president of the
commission from among the members of the commission. The
president shall preside at all meetings and sessions of the
commission.

end delete

begin delete SEC. 2. end delete
begin insert SECTION 1. end insert   

Section 305.5 is added to the Public Utilities
Code, to read:

305.5.  

(a) The commission begin delete shall direct the executive director,
the attorney, and other staff of the commission, except for the staff
of the Office of Ratepayer Advocates described in Section 309.5,
in performance of their duties. end delete begin insert may delegate specific management
and internal oversight functions to committees composed of two
commissioners. Committees shall meet regularly with staff and
shall report to the commission for additional guidance or approval
of decisions pertaining to the operations of the commission. end insert

begin delete

(b) The commission may delegate specific management and
internal oversight functions to committees composed of two
commissioners. Committees shall meet regularly with staff and
shall report to the commission for additional guidance or approval
of decisions pertaining to the operations of the commission.

end delete begin delete

(c)

end delete

begin insert (b) end insert  The commission shall vote in an open meeting on the
assignment or reassignment of any proceeding to one or more
commissioners.

begin delete

SEC. 3.  

Section 307 of the Public Utilities Code is amended
to read:

307.  

(a) The commission may appoint as attorney to the
commission an attorney at law of this state, who shall hold office
during the pleasure of the commission.

(b) The attorney shall represent and appear for the people of the
State of California and the commission in all actions and
proceedings involving any question under this part or under any
order or act of the commission. If directed to do so by the
commission, the attorney shall intervene, if possible, in any action
or proceeding in which any such question is involved.

(c) The attorney shall commence, prosecute, and expedite the
final determination of all actions and proceedings directed or
authorized by the commission, advise the commission and each
commissioner, when so requested, in regard to all matters in
connection with the powers and duties of the commission and the
members thereof, and generally perform all duties and services as
attorney to the commission that the commission may require of
him or her.

end delete

begin insert

begin insert SEC. 2. end insert   

end insert

begin insert Section 307.5 is added to the end insert begin insert Public Utilities Code end insert begin insert , to
read: end insert

begin insert

begin insert 307.5. end insert   

(a) The commission shall appoint a chief administrative
law judge, who shall hold office at the pleasure of the commission.

(b) The chief administrative law judge shall be responsible for
the commission’s executive and administrative management and
oversight of the administrative law judge division and shall
organize, coordinate, supervise, and direct the operations of the
division as directed by the commission, consistent with commission
policies and priorities.

(c) The chief administrative law judge shall keep a full and true
record of all proceedings of the commission.

end insert

begin delete SEC. 4. end delete
begin insert SEC. 3. end insert   

Section 308 of the Public Utilities Code is amended
to read:

308.  

(a) The commission shall appoint an executive director,
who shall hold office during its pleasure. The executive director
shall be responsible for the commission’s executive and
administrative duties and shall organize, coordinate, supervise,
and direct the operations and affairs of the commission and
expedite all matters within the commission’s jurisdiction.

(b) The executive director shall begin delete keep a full and true record of
all proceedings of the commission, end delete issue all necessary process,
writs, warrants, and notices, and perform any other duties as the
commission prescribes. The begin delete commission end delete begin insert president or, by vote, the
commission end insert may authorize the executive director to dismiss
complaints or applications when all parties are in agreement
thereto, in accordance with rules that the commission may
prescribe.

(c) The commission may appoint assistant executive directors
who may serve warrants and other process in any county or city
and county of this state.

begin delete SEC. 5. end delete
begin insert SEC. 4. end insert   

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 begin delete if
there is an appearance of end delete begin insert for end insert bias or prejudice based on any of the
following:

(A) Actions taken during the proceeding.

(B) Private communications before the commencement of the
proceeding to influence the request for relief sought by any party
to the proceeding.

(C) 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 begin delete an
appearance of end delete bias or prejudice pursuant to paragraph (1).

(c) The commission procedures shall prohibit a commissioner
or administrative law judge from ruling 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.

begin delete SEC. 6. end delete
begin insert SEC. 5. end insert   

Section 1701.1 of the Public Utilities Code is amended
to read:

1701.1.  

(a) The commission, consistent with due process,
public policy, and statutory requirements, shall determine whether
a proceeding requires a hearing. The commission shall determine
whether begin delete the matter requires end delete begin insert each proceeding is end insert a quasi-legislative,
an adjudication, or a ratesetting begin delete hearing. end delete begin insert proceeding. end insert 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. If that decision is not appealed to the commission within
that time period it shall not be subsequently subject to judicial
review. 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 begin delete a end delete begin insert an adjudication hearing
or ratesetting end insert hearing 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. begin insert 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. end insert

begin insert

(c) The commission upon initiating a quasi-legislative hearing
shall assign one or more commissioners to oversee the case and
an administrative law judge 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.

end insert begin delete

(c)

end delete

begin insert (d) end insert  (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.

(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.

begin insert

(4) “En banc hearing,” for purposes of this article, is a public
hearing held on the record before a quorum of commissioners at
which parties to a proceeding shall have the right to participate
and let their views be heard regarding any factual, legal, or policy
issue in the proceeding.

end insert begin delete

(d)

end delete

begin insert (e) end insert  (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
begin insert before the commission end insert that 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
begin delete communications end delete begin insert issues end insert 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 party to 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 may invest in the shares or operations of
any party to 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
section, 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 begin delete Chief
Administrative Law Judge end delete begin insert chief administrative law judge end insert of the
commission; begin insert and end insert the administrative law judge assigned to the
begin delete proceeding; and the director of the Energy Division, the director
of the Communications Division, the director of the Water and
Audits Division, and the director of the Safety and Enforcement
Division, where those directors are acting in an advisory capacity
in the end delete proceeding.

begin delete

(3) For quasi-legislative cases, the rules shall provide that ex
parte communications that are required to be reported shall be
reported by the interested person, whether the communication was
initiated by the interested person or the decisionmaker.

(4) For quasi-legislative cases, ex parte communications shall
be reported by an interested person within three working days of
the communication by filing a “Notice of Ex Parte
Communication” with the commission in accordance with the
procedures established by the commission for the service of that
notice. The notice shall include the following information:

(A) The date, time, and location of the communication, whether
it was oral, written, or a combination, and the communications
medium utilized.

(B) The person initiating the communication, including a
decisionmaker, when applicable, and the identity of the recipient
and any persons present during the communication.

(C) A complete and comprehensive description of the interested
person’s and the decisionmaker’s communication and its content,
to which shall be attached a copy of any written material or text
used during the communication.

(5)

end delete

begin insert (3) end insert  For adjudication and ratesetting cases, the rules shall provide
that begin delete if a prohibited end delete begin insert ex parte communications shall be prohibited,
as required by this article. The rules shall provide that if an end insert ex
parte communication begin delete occurs, end delete begin insert occurs that is prohibited by this
article, end insert whether initiated by a decisionmaker or an interested
person, all of the following shall be required:

(A) The interested person begin delete participating in the communication end delete
shall report the communication within one working day of the
communication by filing a begin delete Notice of Prohibited Ex Parte
Communication end delete begin insert notice end insert with the commission begin delete in accordance with
the procedures established by the commission for the service of
that notice. The notice shall include the information required by
paragraph (4). end delete begin insert that includes all the following: end insert

begin insert

(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.

end insert begin insert

(ii) The identity of the decisionmaker, the identity of the person
initiating the communication, and any other persons present.

end insert begin insert

(iii) A complete and comprehensive description of the interested
person’s and the decisionmaker’s communication and its content.

end insert begin insert

(iv) A copy of any written material or text used during the
communication.

end insert

(B)  begin delete A end delete begin insert Any end insert decisionmaker who participated in the begin delete prohibited end delete
communication shall comply with both of the following:

(i) If the interested person who participated in the
communication has not timely submitted the begin delete Notice of Prohibited
Ex Parte Communication end delete begin insert notice end insert required by subparagraph (A),
the decisionmaker shall promptly prepare and file a
begin delete “Decisionmaker’s Notice of Prohibited Ex Parte Communication”
with the commission in accordance with the procedures established
by the commission for the service of that notice. The notice shall
include the information required by paragraph (4). end delete begin insert notice that
includes the information required by subparagraph (A). end insert

(ii) If the interested person has timely submitted the begin delete Notice of
Prohibited Ex Parte Communication end delete begin insert notice end insert required by
subparagraph (A), the decisionmaker shall begin delete review the interested
person’s submitted notice. If the decisionmaker believes that the
interested person’s submitted notice is not accurate or does not
meet the requirements of paragraph (4), the decisionmaker shall
promptly file a notice that corrects or supplements the interested
person’s submitted notice in accordance with the procedures
established by the commission for the service of that notice. If the
decisionmaker believes that the interested person’s submitted
notice is accurate and meets the requirements of paragraph (4),
the decisionmaker shall promptly file a notice that indicates his or
her concurrence with the interested person’s submitted notice in
accordance with the procedures established by the commission. end delete
begin insert either promptly file a notice affirming the factual representations
made by the interested person in the notice or promptly file a notice
correcting or supplementing the factual representations made by
the interested person. end insert

begin delete

(6)

end delete

begin insert (4) end insert  The commission shall not take any vote on a matter begin delete to which
a prohibited ex parte communication is known to have occurred
until the notices required by this subdivision have been made and end delete
begin insert where a notice has been filed pursuant to subparagraph (A) or (B)
of paragraph (3) until end insert all parties to the proceeding have been
provided a reasonable opportunity to respond to the begin delete prohibited ex
parte end delete communication.

begin delete

(7)

end delete

begin insert (5) end insert  If begin delete the end delete begin insert a end insert prohibited 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, begin delete the commission shall provide a
reasonable time for a party to end delete begin insert a party not participating in the
communication may end insert file a petition to rescind or modify the
decision. begin insert 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. end insert 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.

begin delete

(8) A decisionmaker shall periodically report summary logs of
ex parte communications with interested persons in compliance
with rules established by the commission to be included in its
Rules of Practice and Procedure. The commission shall post the
summary logs on its Internet Web site. A summary log, at a
minimum, shall include information required in paragraph (3) and
in subparagraphs (A) and (B) of paragraph (4) and the relevant
proceedings discussed. If a decisionmaker believes that a Notice
of Ex Parte Communication submitted by an interested person in
a quasi-legislative case is inaccurate or fails to meet the
requirements of paragraphs (3) and (4), the decisionmaker may
include corrected or supplemental information in the summary log
and shall also provide notice of any corrected or supplemental
information in the proceeding to which it pertains in accordance
with the procedures established by the commission for the service
of that information. The commission shall enable the posting of
summary logs on its Internet Web site not later than July 1, 2016.

(9)

end delete

begin insert (6) end insert  (A) Ex parte communications that occur at begin delete conferences,
including open session communications, shall be governed by the
provisions of this article and any rules adopted by the commission
pursuant to end delete begin insert conferences that are related to an adjudication or
ratesetting proceeding shall be prohibited consistent with the ex
parte communications requirements of end insert this article.

begin delete

(B) Notwithstanding subparagraph (A), the commission may
adopt rules for inclusion in the commission’s Rules of Practice
and Procedure specific to open session communications if the rules
do both of the following:

end delete begin delete

(i) Open session communications relating to a pending
adjudication case or a pending ratesetting case shall be prohibited.

end delete begin delete

(ii) Open session communications relating to a pending
quasi-legislative case may be permitted if the commission’s rules
require that permitted open session communications are promptly
disclosed in the proceeding to which the communication relates
and require that parties to the proceeding are allowed a reasonable
opportunity to respond to the communication before the
commission may vote on any matter to which the communication
pertained.

end delete begin delete

(C) For purposes of this section, “open session communication”
means an ex parte communication made in a speech, comment, or
writing delivered to all attendees of a noticed session of a
conference. All other ex parte communications at a conference,
including, but not limited to, communications in a private setting
or during meals, entertainment events, tours, and informal
discussions among conference attendees, are not included in the
definition of open session communication.

end delete begin insert

(B) Ex parte communications that occur at conferences and that
are related to a quasi-legislative proceeding shall be governed by
the ex parte communication disclosure requirements developed
by the commission.

end insert begin insert

(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.

end insert begin delete

(10)

end delete

begin insert (7) end insert  The commission shall render its decisions based on the
evidence in the record. Ex parte communications shall not be a
part of the record of the proceedings.

begin insert

(f) The commission may meet in a closed session to discuss
administrative matters not related to a proceeding before the
commission, so long as no collective consensus is reached or vote
taken on any matter requiring a vote of the commissioners.

end insert

begin delete SEC. 7. end delete
begin insert SEC. 6. end insert   

Section 1701.2 of the Public Utilities Code is amended
to read:

1701.2.  

begin delete (a) end delete begin delete   end delete begin delete If end delete begin insert If end insert the commission pursuant to Section 1701.1
has determined that an adjudication case requires a hearing, the
procedures prescribed by this section shall be applicable. begin delete The end delete

begin insert (a) end insert begin insert   end insert begin insert The end insert 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. begin delete The end delete

begin insert (b) end insert begin insert   end insert begin insert The end insert 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. begin delete The end delete

begin insert (c) end insert begin insert   end insert begin insert The end insert 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. begin delete The commission end delete

begin insert

(d) The commission shall hold an en banc hearing before a
quorum of commissioners, in all adjudication cases in which an
appeal has been filed, at which all parties have an opportunity to
be heard, unless all parties waive this requirement and a majority
of commissioners concur with that waiver. The commission shall
adopt rules for implementation of this requirement, which shall
provide for the broadest participation by parties to the proceeding
that the commission can reasonably accommodate, consistent with
the commissioners’ other duties and responsibilities.

end insert

begin insert (e) end insert begin insert   end insert begin insert The commission’s end insert decision shall be begin insert supported by findings
of fact on all issues material to the decision, and the findings of
fact shall be end insert 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.

begin delete

(b)

end delete

begin insert (f) end insert  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 begin delete (d). end delete
begin insert (h). end insert 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.

begin delete

(c)

end delete

begin insert (g) end insert  (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.

begin delete

(d)

end delete

begin insert (h) end insert  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.

begin delete

(e)

end delete

begin insert (i) end insert  Adjudication cases shall be resolved within 12 months of
initiation unless the commission makes findings why that 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.

begin delete

(f)

end delete

begin insert (j) end insert  (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.

begin delete SEC. 8. end delete
begin insert SEC. 7. end insert   

Section 1701.3 of the Public Utilities Code is amended
to read:

1701.3.  

begin delete (a) end delete begin delete   end delete begin delete If end delete begin insert If end insert the commission pursuant to Section 1701.1
has determined that a ratesetting case requires a hearing, the
procedures prescribed by this section shall be applicable. begin delete The end delete

begin insert (a) end insert begin insert   end insert begin insert The end insert 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. begin delete An end delete

begin insert (b) end insert begin insert   end insert begin insert An end insert alternate decision may be issued by the assigned
commissioner or the assigned administrative law judge who is not
the principal hearing officer. begin delete The end delete begin insert 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. end insert

begin insert (c) end insert begin insert   end insert begin insert The end insert 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 the closing arguments of the case.
begin delete The end delete

begin insert (d) end insert begin insert   end insert begin insert The end insert 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. begin delete The alternate decision shall be filed with the
commission and shall be served on all parties simultaneously with
the proposed decision. end delete

begin delete

The

end delete

begin insert (e) end insert begin insert   end insert begin insert The end insert 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.

begin delete

(b)

end delete

begin insert (f) end insert  The commission shall provide by regulation 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 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.

begin delete

(c)

end delete

begin insert (g) end insert  (1) Ex parte communications are prohibited in ratesetting
cases.

(A) Oral communications may be permitted begin delete without any
reporting obligation at any time by any end delete begin insert by a end insert decisionmaker if all
parties are invited and given not less than three working days’
notice.

(B) Written ex parte communications by any interested person
may be permitted begin delete without any reporting requirement end delete provided that
copies of the communication are transmitted to all parties on the
same day as the original communication. Written ex parte
communications shall not be part of the record of the proceeding.

begin insert

(C) The commission may establish a period during which no
oral or written 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.

end insert

(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 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.

begin delete

(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.

end delete begin insert

(h) The commission shall hold an en banc hearing before a
quorum of commissioners, after the proposed decision is issued
in all contested ratesetting cases, at which all parties have an
opportunity to be heard, unless all parties waive this requirement
and a majority of commissioners concur with that waiver. The
commission shall adopt rules for implementation of this
requirement, which shall provide for the broadest participation
by parties to the proceeding that the commission can reasonably
accommodate, consistent with the commissioners’ other duties
and responsibilities.

end insert begin delete

(e)

end delete

begin insert (i) end insert  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.

begin delete SEC. 9. end delete
begin insert SEC. 8. end insert   

Section 1701.4 of the Public Utilities Code is amended
to read:

1701.4.  

begin delete (a) end delete begin delete   end delete begin delete If end delete begin insert If end insert the commission pursuant to Section 1701.1
has determined that a quasi-legislative case requires a hearing, the
procedures prescribed by this section shall be applicable. begin delete The end delete

begin insert (a) end insert begin insert   end insert begin insert The end insert assigned administrative law judge shall act as an
assistant to the assigned commissioner in quasi-legislative cases.
begin delete The assigned commissioner shall be present for formal hearings. end delete
The assigned commissioner shall prepare the proposed rule or
order with the assistance of the administrative law judge. 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.

(b) Ex parte communications shall be permitted. Any ex parte
communication shall be reported begin delete by an interested person in
accordance with subdivision (d) of Section 1701.1 and the
procedures established by the commission for the service of that
notice. end delete begin insert in compliance with Section 1701.6. end insert No reporting shall be
required for written ex parte communications that are transmitted
to all parties on the same day as the original communication.

begin delete

(c) 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.

end delete begin insert

(c) The commission shall hold an en banc hearing before a
quorum of commissioners, after the proposed decision is issued
in all contested quasi-legislative cases, unless all parties waive
this requirement and a majority of commissioners concur with that
waiver. The commission shall adopt rules for implementation of
this requirement, which shall provide for the broadest participation
by parties to the proceeding that the commission can reasonably
accommodate, consistent with the commissioners’ other duties
and responsibilities.

end insert

(d) 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.

begin insert

begin insert SEC. 9. end insert   

end insert

begin insert Section 1701.5 of the end insert begin insert Public Utilities Code end insert begin insert is amended
to read: end insert

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 begin delete scoping memo is issued, end delete begin insert proceeding is initiated, end insert 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. No single order may extend the deadline
for more than 60 days.

(b) Notwithstanding subdivision (a), the commission may
specify in a scoping memo a resolution date later than 18 months
from the date the begin delete scoping memo is issued, end delete begin insert proceeding is initiated, end insert
if that scoping memo includes specific reasons for the necessity
of a later date and the commissioner assigned to the case approves
the date.

begin insert

begin insert SEC. 10. end insert   

end insert

begin insert Section 1701.6 is added to the end insert begin insert Public Utilities Code end insert begin insert ,
to read: end insert

begin insert

begin insert 1701.6. end insert   

(a) The commission shall establish and maintain a
communications log summarizing all oral or written ex parte
communications, as defined in Section 1701.1.

(b) The communications log shall include a summary of all oral
and written communications that meet the definition of an ex parte
communication that occur between an interested person and any
of the following officials:

(1) A commissioner.

(2) The attorney for the commission.

(3) The executive director of the commission.

(4) The personal staff of a commissioner, if the staff is acting
in a policy or legal advisory capacity.

(5) The chief administrative law judge of the commission.

(6) The administrative law judge assigned to the proceeding.

(c) Each record of a communication in the communication log
shall include the date of each communication, the persons involved
in the communication, the topics discussed, and, to the extent
known, any proceedings that were the subject of each
communication. Ex parte communications in the summary log
shall be reported no later than three working days after the
communication.

(d) The communication log shall be made available to the public
on the commission’s Internet Web site not later than July 1, 2016.

end insert

begin delete SEC. 10. end delete
begin insert SEC. 11. end insert   

Section begin delete 1701.6 end delete begin insert 1701.7 end insert is added to the Public Utilities
Code, to read:

begin delete 1701.6. end delete
begin insert 1701.7. end insert   

(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. begin delete If the violation
consists of failing to file a required notice of a permissible ex parte
communication or filing a notice of a permissible ex parte
communication that is inaccurate or incomplete, each day that the
violation is not remedied shall constitute a separate violation. end delete

(2) If the entity or person may obtain, by violating the ex parte
communication requirements, financial benefits that 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
begin delete proceedings. end delete begin insert proceedings and whether the entity or person
knowingly violated the ex parte communication requirements. end insert

(3) The financial resources of the entity or person.

(4) The totality of the circumstances in furtherance of the public
interest.

begin delete SEC. 11. end delete
begin insert SEC. 12. end insert   

Section begin delete 1701.7 end delete begin insert 1701.8 end insert is added to the Public Utilities
Code, to read:

begin delete 1701.7. end delete
begin insert 1701.8. end insert   

(a) The Attorney General may bring an enforcement
action in the Superior Court for the City and County of San
Francisco 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. The
court shall expedite its review of the action to provide effective
and timely relief.

(b)  begin delete (1) end delete begin delete   end delete begin delete Notwithstanding end delete begin insert Notwithstanding end insert 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 begin delete not to exceed fifty thousand dollars ($50,000) for each violation. end delete
begin insert as provided in Section 2111. end insert

begin delete

(2) If the decisionmaker or employee may obtain, by violating
the ex parte communication requirements, financial benefits that
exceed the civil penalties provided in paragraph (1), the court may
impose a civil penalty up to the amount of those financial benefits.

end delete

(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.

(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.

begin delete SEC. 12. end delete
begin insert SEC. 13. end insert   

No reimbursement is required by this act pursuant to
Section 6 of Article XIII B of the California Constitution because
the only costs that may be incurred by a local agency or school
district will be incurred because this act creates a new crime or
infraction, eliminates a crime or infraction, or changes the penalty
for a crime or infraction, within the meaning of Section 17556 of
the Government Code, or changes the definition of a crime within
the meaning of Section 6 of Article XIII B of the California
Constitution.