BILL NUMBER: SB 1350 INTRODUCED
BILL TEXT
INTRODUCED BY Senator Leno
FEBRUARY 24, 2012
An act to amend Sections 2104 and 2104.5 of the Public Utilities
Code, relating to public utilities.
LEGISLATIVE COUNSEL'S DIGEST
SB 1350, as introduced, Leno. Public utilities: fines and
penalties.
Under existing law, the Public Utilities Commission has regulatory
authority over public utilities, as defined. The Public Utilities
Act requires the commission to investigate the cause of all accidents
occurring upon the property of any public utility or directly or
indirectly arising from or connected with its maintenance or
operation, resulting in loss of life or injury to person or property
and requiring, in the judgment of the commission, investigation by
it, and authorizes the commission to make any order or recommendation
with respect to the investigation that it determines to be just and
reasonable. The act provides that any public utility that violates
any provision of the California Constitution or the act, or that
fails or neglects to comply with any order, decision, decree, rule,
direction, demand, or requirement of the commission, where a penalty
has not otherwise been provided, is subject to a penalty of not less
than $500 and not more than $50,000 for each offense. Existing law
requires that any fine or penalty imposed by the commission and
collected from a public utility be paid to the State Treasury to the
credit of the General Fund. The act includes provisions that are
specific to gas corporations that involve safety standards for
pipeline facilities or the transportation of gas in the state.
This bill would revise the provisions that are specific to gas
corporations that involve safety standards for pipeline facilities or
the transportation of gas in the state, to authorize the commission
to order that all or a portion of a fine or penalty levied against a
gas corporation in relation to a safety standard for pipeline
facilities or the transportation of gas in the state be held in trust
by the commission to offset expenses for gas safety measures that
would otherwise be recovered from the utility's customers. The bill
would require that moneys ordered by the commission to be held in
trust be used only for the purpose of offsetting expenses incurred by
the gas corporation for gas safety measures, and only if the
expenses would otherwise be recovered in rates from the utility's
customers. The bill would require that any moneys not used for these
purposes be paid to the General Fund.
Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: no.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Section 2104 of the Public Utilities Code, as amended
by Section 7 of Chapter 552 of the Statutes of 2008, is amended to
read:
2104. (a) Except as provided by Sections 2100 and 2107.5, and in
addition to the remedies provided in Sections 688.020 and 688.030 of
the Code of Civil Procedure, actions to recover penalties under this
part may be brought in the name of the people of the State of
California, in the superior court in and for the county, or city and
county, in which the cause or some part thereof arose, or in which
the corporation complained of has its principal place of business, or
in which the person complained of resides. The action, if brought
pursuant to this section, shall be commenced and prosecuted to final
judgment by the attorney or agent of the commission. All fines and
penalties may be sued for and recovered. The commission may enjoin
the sale of a public utility's or common carrier's assets to satisfy
unpaid fines and penalties. The commission may use any of the
remedies afforded to a creditor under the Uniform Fraudulent Transfer
Act (Chapter 1 (commencing with Section 3439) of Title 2 of Part 2
of Division 4 of the Civil Code). Respondents who fraudulently
transfer assets to avoid paying commission-imposed fines or penalties
are subject to prosecution under Sections 154, 531, and 531a of the
Penal Code. In all of these actions, the procedure and rules of
evidence shall be the same as in ordinary civil actions, except for
prosecutions under the Penal Code or as otherwise herein provided.
All Except as provided in Section 2104.5, all
fines and penalties recovered by the state in any action,
together with the costs thereof, shall be paid into the State
Treasury to the credit of the General Fund. Any action may be
compromised or discontinued on application of the commission upon the
terms the court approves and orders.
(b) This section shall remain in effect only until January 1,
2014, and as of that date is repealed, unless a later enacted
statute, that is enacted before January 1, 2014, deletes or extends
that date.
SEC. 2. Section 2104 of the Public Utilities Code, as added by
Section 8 of Chapter 552 of the Statutes of 2008, is amended to read:
2104. (a) Except as provided by Sections 2100 and 2107.5, actions
to recover penalties under this part shall be brought in the name of
the people of the State of California, in the superior court in and
for the county, or city and county, in which the cause or some part
thereof arose, or in which the corporation complained of has its
principal place of business, or in which the person complained of
resides. The action shall be commenced and prosecuted to final
judgment by the attorney or agent of the commission. All fines and
penalties may be sued for and recovered. The commission may enjoin
the sale of a public utility's or common carrier's assets to satisfy
unpaid fines and penalties. The commission may use any of the
remedies afforded to a creditor under the Uniform Fraudulent Transfer
Act (Chapter 1 (commencing with Section 3439) of Title 2 of Part 2
of Division 4 of the Civil Code). Respondents who fraudulently
transfer assets to avoid paying commission-imposed fines or penalties
are subject to prosecution under Sections 154, 531, and 531a of the
Penal Code. In all of these actions, the procedure and rules of
evidence shall be the same as in ordinary civil actions, except for
prosecutions under the Penal Code or as otherwise herein provided.
All Except as provided in Section 2104.5, all
fines and penalties recovered by the state in any action,
together with the costs thereof, shall be paid into the State
Treasury to the credit of the General Fund. Any action may be
compromised or discontinued on application of the commission upon the
terms the court approves and orders.
(b) This section shall become operative on January 1, 2014.
SEC. 3. Section 2104.5 of the Public Utilities Code is amended to
read:
2104.5. (a) Any penalty for violation of
any provision of this act, or of any rule, regulation, general order,
or order of the commission, involving safety standards for pipeline
facilities or the transportation of gas in the State of California
may be compromised by the commission. In determining the amount of
such the penalty, or the amount agreed
upon in compromise, the appropriateness of such
the penalty to the size of the business of the person
charged, the gravity of the violation, and the good faith of the
person charged in attempting to achieve compliance, after
notification of a violation, shall be considered. The amount of any
such penalty, when finally determined, or the
amount agreed upon in compromise, may be recovered in a civil action
in the name of the People people of the
State of California in the superior court in and for the county, or
city and county in which the cause or some part thereof arose, or in
which the corporation complained of has its principal place of
business or the person complained of resides. In any such action, all
penalties incurred, or amounts agreed upon in compromise for
violations committed up to the time of commencing the action may be
sued for and recovered. In all such those
actions, the procedure and rules of evidence shall be the same
as in ordinary civil actions, except as otherwise herein provided.
All fines and penalties recovered by the state in any such
action, together with the costs thereof, shall be paid into
the State Treasury to the credit of the General Fund , except
upon order of the commission pursuant to subdivision (b) .
(b) The commission may order that all or a portion of a fine or
penalty levied against a gas corporation in relation to a safety
standard for pipeline facilities or the transportation of gas in the
state be held in trust by the commission to offset expenses for gas
safety measures that would otherwise be recovered from the utility's
customers.
(c) Any moneys ordered by the commission to be held in trust
pursuant to subdivision (b) may be used only for the purpose of
offsetting expenses incurred by the gas corporation for gas safety
measures, and only if the expenses would otherwise be recovered in
rates from the utility's customers. Any moneys not used for these
purposes shall be paid to the General Fund.