BILL ANALYSIS
AB 863
Page 1
Date of Hearing: May 11, 2009
ASSEMBLY COMMITTEE ON UTILITIES AND COMMERCE
Felipe Fuentes, Chair
AB 863 (Niello) - As Amended: April 14, 2009
SUBJECT : Municipal utility districts: civil service
exemptions.
SUMMARY : Increases the maximum percentage of exempt employees
the board of a utility district meeting specific criteria may
appoint, from 2% to 5% of the total civil service positions of
the district.
EXISTING LAW :
1)Allows the board of directors of a municipal utility district
with more than 600 employees to appoint up to 15 employees to
positions requiring particular and exceptional qualifications
including those of scientific, professional, or expert
character or of special confidence.
2)Allows the board of a district which has owned and operated an
electric distribution system for at least eight years and has
a population of 250,000 or more to determine that additional
positions requiring peculiar and exceptional qualifications
shall be exempt from civil service, if the number of exempt
positions do not exceed 2% of the total civil service
positions of the district.
3)Allows a board to contract for or employ any professional
service by the district to perform work or services which
cannot satisfactorily be performed under the civil service
provisions.
FISCAL EFFECT : Unknown.
COMMENTS : According to the author, the purpose of this bill is
to allow the Sacramento Municipal Utilities District (SMUD) the
ability to endure a rapidly changing, complex, and increasingly
technical industry. SMUD expects to need the flexibility to
designate additional non-civil service employees with unique
scientific, engineering, and other professional qualifications
to be able to keep up with the rapid succession of statutory and
regulatory changes.
1) Background : This section of code (Public Utilities Code
Sec. 11887.1) only applies to SMUD. Current law allows the SMUD
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board to designate positions as non-civil service where the
positions require "peculiar and exceptional qualifications,
including, but not limited to, those of a scientific,
professional, or expert character or of special confidence, or
positions with significant managerial responsibility." These
"exempt" positions cannot exceed 2% of the total civil service
positions of the district. Under this rule, SMUD currently has
41 exempt professional employees, very close to the cap of 44.
This bill would increase the number of exempt employees to 110,
or an increase of 66 positions.
2) State legislative directives : The Legislature has imposed
additional rules and regulations on municipal utilities. For
example, the governing board of a local publicly owned electric
utility is responsible for implementing and enforcing a
renewables portfolio standard that recognizes the intent of the
Legislature to encourage renewable energy resources, while
taking into consideration the effect of the standard on rates,
reliability, and financial resources and the goal of
environmental improvement. In addition, existing law also
requires the governing board of a local publicly owned electric
utility to annually report certain information relative to
renewable energy resources to its customers. Three bills are
moving through the legislative process at this time that will
require all electricity providers to procure at least 33% of
their electricity from renewable sources by 2020: AB 64
(Krekorian), SB 14 (Simitian), and SB 805 (Wright).
SB 107 (Simitian) Chapter 464, Statutes of 2006, requires that
the governing board of a local publicly owned electric utility
annually report the utility's status of implementing a
renewables portfolio standard, report the progress toward
attaining the standard to its customers, and report to the
California Energy Commission (CEC) the information that the
governing board is required to annually report to their
customers.
AB 32 (Nunez) Chapter 488, Statutes of 2006, requires the Air
Resources Board to adopt regulations to monitor and enforce
compliance with reducing greenhouse gas emissions to 1990 levels
by 2020. The California Public Utilities Commission and the CEC
provided recommendations on how greenhouse gas emission
reductions could be achieved in the energy sector. Because
municipal utilities serve about one-third of California's
electricity consumers, the rules will apply to municipal
utilities as well as all other electricity providers.
3) Will labor sweat it : SMUD states that this bill would not
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impact the unions or the unions' membership. Currently SMUD has
2,180 civil service employees. Approximately 55% are represented
by local IBEW #1245 and the Organization of SMUD Employees. The
remainder consists of management and professional employees.
This increase in the percentage will allow SMUD to exempt key
professional employees from civil service for future hires only,
and the number would be capped at 5% of the total number of
civil service employees.
4) Do the math : Current law restricts other municipal
utilities to no more than 15 positions for a utility with 600 or
more employees. This comes out to 2.5% for a company with 600
employees, and 1.5% for a district with 1,000 employees. With
regard to SMUD, a 15-position cap would equate to 0.7% of the
workforce being exempt. Other municipal utilities cap the
number or percentage of management and professional employees
that are exempt from civil-service status.
Some of the irrigation districts are governed by the Water Code,
which is broader than the Public Utilities Code. The Water Code
requires the board of an irrigation district to approve and
reject the number of deputies of elective and appointive
officers. The treasurer and collector may appoint as many
deputies within the number allowed by the board as may be
necessary to perform their duties. The assessor may appoint as
many deputies as he or she needs during a limited time period
(for work performed between the first Monday in March and the
first Monday in August) to complete the district's annual
assessments.
REGISTERED SUPPORT / OPPOSITION :
Support
California Special Districts Association (CSDA)
Sacramento Municipal Utilities District (SMUD)
Opposition
None on file.
Analysis Prepared by : Gina Adams/ U. & C. / (916) 319-2083