BILL ANALYSIS �
AB 2218
Page 1
Date of Hearing: May 7, 2014
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Mike Gatto, Chair
AB 2218 (Bradford) - As Amended: April 24, 2014
Policy Committee: Utilities and
Commerce Vote: 10-0
Urgency: No State Mandated Local Program:
Yes Reimbursable: No
SUMMARY
This bill requires each electrical and gas corporation to
develop and implement a rate assistance program for eligible
foods banks, subject to direction and supervision by the Public
Utilities Commission (PUC). Specifically, this bill:
1)Requires the funding source for the program to be approved by
the PUC.
2)Defines "eligible food bank" as a public or charitable
institution that participates in the federal Emergency Food
Assistance Program.
FISCAL EFFECT
1)Increased costs for the PUC to direct and oversee the program
in the $250,000 range.
2)Minor cost shifts and the resulting rate increases for all
other ratepayers to provide federally registered food banks
(currently 48 statewide) with energy discounts.
COMMENTS
1)Rationale. According to the author, California's food banks
stabilize our most underserved and economically challenged
families. However, many food banks find it costly to maintain
their refrigeration units to house perishables such as fruits,
vegetables, and dairy products. For these reasons, food banks
are uniquely deserving of energy discounts.
AB 2218
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Electricity costs are a common concern for food banks across
the state. Currently, the Fresno Community Food Bank, which
serves four counties, sees a summer cost of approximately
$9,000 - $11,000 per month and a winter cost of approximately
$5,000-$6,000 per month to provide assistance to the most in
need in the Central Valley.
This bill directs electrical and gas corporations to develop
and implement a program of rate assistance for certified food
banks subject to direction and supervision by the PUC.
2)Background. The Department of Social Services operates the
Emergency Food Assistance Program that contracts with 48 food
banks servicing 58 counties in California. Each contracted
food bank distributes commodities received from United States
Department of Agriculture (USDA). These food banks must follow
federal guidelines.
3)California Ratepayer Assistance Programs. For decades, state
and federal governments have overseen low income programs to
provide low income customers discounts on their utility bills
to the extent customers meet program eligibility requirements,
including the following programs:
a) The California Alternative Rates for Energy (CARE)
Program offers eligible customers a 20% discount on their
electricity and natural gas bill.
b) The Family Electric Rate Assistance (FERA) offers
assistance to families whose household income slightly
exceeds the low-income energy program allowances by billing
some of their electricity usage at a lower rate.
c) The Energy Savings Assistance Program (ESAP) provides
no-cost weatherization services to low-income households
who meet the CARE income guidelines. Services provided
include attic insulation, energy efficient refrigerators,
energy efficient furnaces, weather stripping, caulking,
low-flow showerheads, water heater blankets, and door and
building envelope repairs which reduce air infiltration.
d) Other Programs. The Department of Community Services
and Development administers Federal low-income home energy
assistance, energy crisis intervention, and low-income
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weatherization programs (LIHEAP). These programs are funded
by federal grants to provide weatherization services and
financial assistance to help low-income customers pay their
energy bills.
1)Funding. Currently, most of California's ratepayer assistance
programs are included in the rate base of regulated utility
companies. This bill requires the regulated utilities to
develop a program but defers the determination of the funding
source to the PUC.
Analysis Prepared by : Jennifer Galehouse / APPR. / (916)
319-2081