BILL ANALYSIS
AB 698
Page 1
Date of Hearing: April 27, 2009
ASSEMBLY COMMITTEE ON NATURAL RESOURCES
Nancy Skinner, Chair
AB 698 (Skinner) - As Amended: April 21, 2009
SUBJECT : Utility property
SUMMARY : Authorizes a staff director of the Public Utilities
Commission (PUC) to approve the disposal of a utility's property
when the transaction is valued under $5 million and the
utility's application is not contested by any party.
EXISTING LAW :
1)Prohibits a public utility regulated by the PUC from disposing
of any property necessary or useful in the utility's
performance of its duties to the public without approval of
the PUC. Transactions valued above $5 million require a
formal order of the PUC approving an application filed by the
utility. Transactions valued at $5 million or less may be
approved by the PUC via a resolution approving an advice
letter filed by the utility. (Public Utilities Code Section
851)
2)Provides that proposed transactions that require review under
the California Environmental Quality Act (CEQA) are not
eligible for approval by the PUC via advice letter. (Public
Utilities Code Section 853)
THIS BILL :
1)Authorizes approval of a Section 851 advice letter by a PUC
staff director, rather than a vote of the commissioners, if
the utility's application is not contested by any party.
2)Provides that an advice letter may be used to approve a
transaction subject to CEQA if the PUC is not the lead agency
for CEQA's purposes and the lead agency has completed the
appropriate CEQA review. In this case, the advice letter must
be approved by a vote of commissioners, rather than by staff.
FISCAL EFFECT : Unknown.
COMMENTS :
AB 698
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Bill seeks executive decision authority for minor and
non-controversial utility property divestitures. According to
the author's office, current law needs clarification to ensure
that legislative intent to create a streamlined process by which
a utility may for sell or buy low-value property is being
implemented. The sponsor of the bill, PG&E, will be submitting
a large number (potentially hundreds) of applications for
conservation easements on its watershed lands to fulfill its
bankruptcy settlement. PG&E is concerned that these
applications, which it expects to be non-controversial, will
suffer significant delays if a vote of the PUC is required for
each one. This bill allows the PUC greater flexibility to grant
streamlined approvals resulting in more timely approvals,
potential cost reductions and administrative efficiency. The
bill also permits the advice letter process, but not staff
approval, for transactions subject to CEQA, provided any
necessary CEQA review has been completed by the appropriate
agency. The advice letter process allows for approval in less
than 120 days. The more formal procedures for issuing an order
can take the PUC up to 18 months.
REGISTERED SUPPORT / OPPOSITION :
Support
Pacific Gas and Electric Company (sponsor)
Southern California Edison
Opposition
None on file
Analysis Prepared by : Lawrence Lingbloom / NAT. RES. / (916)
319-2092