BILL ANALYSIS �
SB 636
Page A
SENATE THIRD READING
SB 636 (Hill)
As Amended June 15, 2014
Majority vote
SENATE VOTE :33-0
UTILITIES & COMMERCE 14-0
APPROPRIATIONS 17-0
-----------------------------------------------------------------
|Ayes:|Bradford, Patterson, |Ayes:|Gatto, Bigelow, |
| |Bonilla, Buchanan, | |Bocanegra, Bradford, Ian |
| |Ch�vez, Dahle, Fong, Beth | |Calderon, Campos, |
| |Gaines, Garcia, | |Donnelly, Eggman, Gomez, |
| |Roger Hern�ndez, Jones, | |Holden, Jones, Linder, |
| |Mullin, Quirk, Rendon | |Pan, Quirk, |
| | | |Ridley-Thomas, Wagner, |
| | | |Weber |
|-----+--------------------------+-----+--------------------------|
| | | | |
-----------------------------------------------------------------
SUMMARY : Establishes certain procedures that apply to
adjudication, rulemaking, and
ratesetting cases of the California Public Utilities Commission
(PUC). Specifically, this bill :
1)Prohibits an employee, officer, or agent of the PUC that is
personally involved in the prosecution or in the supervision
of the prosecution of an adjudication case from participating
in the decision of the case or in the decision of any
factually related proceeding.
2)Permits an employee, officer, or agent of the PUC that is
personally involved in the prosecution or in the supervision
of the prosecution of an adjudication case to participate in
reaching a settlement of the case, but would prohibit the
officer, employee, or agent from participating in the decision
of the PUC to accept or reject the settlement, except as a
witness or counsel in an open hearing or a specified closed
hearing.
FISCAL EFFECT : According to the Assembly Appropriations
Committee, minor, if any, costs to the PUC.
SB 636
Page B
COMMENTS :
1)Background: The principle of separation of functions is
applied to administrative agencies that engage in
quasi-judicial or adjudicative actions, and the application is
necessary to preserve the due process rights of parties, just
as in a court of law. In administrative adjudication, if the
judge and the prosecutor are housed in the same agency and
under the director of the same administrators, certain
procedures must be in place.
Due process is the principle articulated in the Fifth
Amendment to the United States Constitution as the requirement
that no person "be deprived of life, liberty, or property,
without due process of law." The Fourteenth Amendment extends
this principle to state government. Article XII of the
California Constitution gives the PUC broad authority to
establish its own procedures subject to statute and due
process.<1>
The Federal Administrative Procedures Act (APA) defines two
procedural models: rulemaking and adjudication. In
rulemaking, the rights of an individual are not the subject of
inquiry, and due process considerations do not apply. The
Federal APA addresses separation of adjudicatory and
prosecutorial functions in Section 554 (d):
An employee or agent engaged in the performance of
investigative or prosecuting functions for an agency
in a case may not, in that or a factually related
case, participate or advise in the decision,
recommended decision, or agency review pursuant to
Section 557 of this title, except as witness or
counsel in public proceedings.
The Federal Energy Regulatory Commission (FERC) - the PUC's
federal counterpart - has adopted regulations on separation of
functions:
In any proceeding in which Commission adjudication is
made after hearing, or in any proceeding arising from
an investigation under part 1b of this chapter, [rules
----------------------
<1> California Constitution, Article XII, Section 2
SB 636
Page C
relating to FERC investigations] beginning from the
time the Commission initiates a proceeding governed by
part 385 of this chapter, [FERC rules of practice and
procedure]no officer, employee, or agent assigned to
work upon the proceeding or to assist in the trial
thereof, in that or any factually related proceeding,
shall participate or advise as to the findings,
conclusion or decision, except as a witness or counsel
in public proceedings.<2>
The provisions call for an "ethical wall" between staff that
advise decision makers and staff that prosecute.
The California Office of Administrative Law (OAL) is
responsible for reviewing administrative regulations proposed
by over 200 state agencies for compliance with the standards
set forth in California's Administrative Procedure Act
(California APA), for transmitting these regulations to the
Secretary of State and for publishing regulations in the
California Code of Regulations. The PUC, however, is not
subject to the California APA.
2)Drawing a bright line between functions: This bill harmonizes
PUC practice with established practice at state agencies
subject to the California APA by making separation of PUC
advocacy and advisory functions mandatory. Current law
requires the Office of Ratepayer Advocates to adhere to
separations of functions but not to PUC attorneys or the
general counsel.
This bill prohibits an advisory role for any PUC "officer,
employee, or agent of the PUC that is assigned to assist in
the prosecution of, to testify in, or to supervise the
prosecution of an adjudication case."
Finally, this bill prohibits any employee who prosecutes a
case, or "supervises" the prosecution of a case from advising
the PUC on that case or factually related proceeding.
---------------------------
<2> Code of Federal Regulations, Title 18, Part 385, Section
2202 (18 CFR 385.2202)
http://www.law.cornell.edu/cfr/text/18/385.2202
SB 636
Page D
Analysis Prepared by : DaVina Flemings / U. & C. / (916)
319-2083 FN:
0004563