BILL ANALYSIS
AB 1316
Page 1
Date of Hearing: April 27, 2009
ASSEMBLY COMMITTEE ON UTILITIES AND COMMERCE
Felipe Fuentes, Chair
AB 1316 (Ma) - As Amended: April 22, 2009
SUBJECT : Public utilities: low-income customers.
SUMMARY : Expands the size and responsibilities of the Low
Income Oversight Board (LIOB) within the Public Utilities
Commission (PUC).
EXISTING LAW:
1)Establishes a low-income energy assistance program for
electric and natural gas service customers of investor-owned
utilities (IOUs) funded by a surcharge on energy bills.
2)Requires that the Department of Community Services and
Development receive and administer the federal Low-Income Home
Energy Assistance Program Block Grant, provided for pursuant
to the Low-Income Home Energy Assistance Act of 1981.
3)Establishes a Low-Income Oversight Board to advise the PUC on
low-income electric, gas, and water customer issues and to
serve as a liaison for the commission to low-income ratepayers
and representatives.
4)Requires the LIOB to monitor and evaluate implementation of
all programs provided to low-income electricity, gas, and
water customers.
5)Proscribes the makeup of the Low-Income Oversight Board as
being comprised of 11 members to be selected as follows:
a) Five members selected by the PUC who have expertise in
the low-income
community and who are not affiliated with any state
agency or utility group.
b) One member selected by the Governor.
c) One member selected by the PUC who is a PUC commissioner
or commissioner
designee.
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d) One member selected by the Department of Community
Services and Development.
e) One member selected by the PUC who is a representative
of private
weatherization contractors.
f) One member selected by the PUC who is a representative
of an electrical or
gas corporation.
g) One member selected by the PUC who is a representative
of a water
corporation.
6)Authorizes the LIOB to establish a technical advisory
committee consisting of low-income service providers, utility
representatives, consumer organizations, and PUC staff, to
assist the board.
7)Provides that all reasonable costs incurred by the board in
carrying out its duties will be reimbursed.
THIS BILL:
1)Requires the PUC or the LIOB or both to report biannually to
the Legislature regarding the status of low-income programs.
2)Increases the number of members of the LIOB to 12 by adding
one member selected by the State Air Resources Board.
3)Expands the responsibilities of the LIOB by requiring it to
monitor all proceedings before the PUC that impact low-income
customers, actively solicit public input, and to make
recommendations to the division of Ratepayer Advocates (DRA)
regarding low-income issues.
4)Removes the authorization to create a technical advisory
committee, and requires the LIOB to establish a regulatory
advisory committee consisting of at least one employee of DRA.
Authorizes the committee to request assistance from PUC staff,
utility representatives, low-income service providers and
consumer organizations.
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FISCAL EFFECT : Unknown.
COMMENTS : According to the author's office, this bill will
improve access to assistance for millions of low-income and
fixed income households.
1) Background: Current law establishes within the PUC a Division
of Ratepayer Advocates (DRA). The purpose of the DRA is to
represent and advocate on behalf of the interests of public
utility customers. The statutory goal of the division is to
obtain the lowest possible rate for service consistent with
reliable and safe service levels, and does not specify
low-income customers in any way.
The LIOB was established by SB 2xx (Alarc?n), Chapter 11, 2nd
Extraordinary Session, Statutes of 2001, for the purpose of
enhancing the effectiveness of various energy assistance
programs in order to mitigate the disproportionately high impact
of the energy crisis on low-income individuals. Prior to the
creation of the LIOB the PUC had created, through regulation, a
Low-Income Advisory Board (LIAB) to make recommendations about
low-income energy assistance programs and to be a liaison to the
low-income community. By the time the LIOB was created the LIAB
had essentially become inactive. It was the intent of the SB2xx
to ensure that low-income needs and interests would be well
represented in the PUC's decision-making process.
Current federal and state law provides for a number of
low-income energy assistance programs. State law and federal law
each a program that provides a financial subsidy for energy
bills and a program that provides weatherization services.
Weatherization decreases the heating and cooling costs for
low-income families by improving the energy efficiency of their
homes.
At the state level, California Alternate Rates for Energy (CARE)
is a 20 percent bill discount on electric and natural gas bills
and the Low Income Energy Efficiency (LIEE) is a residential
weatherization and energy efficiency program. These programs are
administered by the IOUs. At the federal level, the Low-Income
Home Energy Assistance Program (LIHEAP) provides funding to
assist with energy bills and offset heating and/or cooling
energy costs. LIHEAP is administered at the state level by the
Department of Community Services and Development (CSD). CSD
strategically leverages its LIHEAP funding with the federal
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Weatherization Assistance Program (WAP), which provides free
weatherization services.
The current makeup of the LIOB is reflective of the various
perspectives needed to ensure adequate oversight of these
low-income programs.
2) Expanded Oversight Duties: This bill creates an expanded role
for the LIOB by requiring that it monitor and evaluate all
proceedings before the commission that affect low-income
individuals. The current role of the LIOB is to monitor the
implementation of low-income programs. In very much the same way
that the energy crisis motivated the legislature to create this
board, the current economic downturn increases the need to
ensure that low-income needs and interests are being represented
in PUC proceedings.
3) Funding: Under current law, all reasonable costs incurred by
the board in carrying out its duties including staffing, travel,
and administrative costs, must be reimbursed through the public
utilities reimbursement account. These costs are part of the
PUC's budget. By expanding the duties of the LIOB this bill will
increase the amount of that reimbursement.
4) PUC or LIOB or both: This bill requires "the PUC or the LIOB
or both" to report biannually to the Legislature regarding the
status of low-income programs. This language creates ambiguity
regarding which body should be accountable to the legislature
regarding the completion, funding and quality of this report. In
order to eliminate any such ambiguity the committee may wish to
consider amending the bill to make one of these entities, in
consultation with the other, primarily responsible for the
report.
5) The new kid: This bill adds a 12th member to the LIOB. During
a joint hearing of the Assembly Natural Resources committee and
the Senate Committee on Energy, Utilities and Communications
regarding the implementation of AB 32, The Global Warming
Solutions Act of 2006 (Nunez), Chapter 488, Statutes of 2006,
community-based organizations testified that the implementation
process lacked adequate representation for low-income
communities. Additionally, the ARB's decisions regarding the
implementation of AB 32 with respect to the electricity sector
have been, and will be, done in consultation with the PUC.
Therefore, adding a seat for the ARB on the LIOB may help to
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bring low-income issues a stronger presence during the
implementation of AB 32 directly and indirectly.
REGISTERED SUPPORT / OPPOSITION :
Support
Latino Issues Forum (Sponsor)
California/Nevada Community Action Partnership
Opposition
None on file.
Analysis Prepared by : Nina Kapoor / U. & C. / (916) 319-2083