(1)Under existing law, the Public Utilities Commission has regulatory authority over public utilities, including electrical corporations, gas corporations, heat corporations, telegraph corporations, telephone corporations, and water corporations. The California Constitution authorizes the commission to establish rules, examine records, and prescribe a uniform system of accounts for all public utilities. The Public Utilities Act requires the commission to inspect and audit the books and records of electrical corporations, gas corporations, heat corporations, telegraph corporations, telephone corporations, and water corporations for regulatory and tax purposes. An inspection and audit is required to be done at least every 3 years if the utility has over 1,000 customers and at least every 5 years if the utility has 1,000 or fewer customers. The act requires that reports of the inspections and audit and other pertinent information be furnished to the State Board of Equalization for use in the assessment of the public utilities.

This bill would delete the requirement that the reports of the inspections and audit and other pertinent information be furnished to the State Board of Equalization for use in the assessment of the public utilities and instead require that the inspections and audit and other pertinent information be posted on the commissions Internet Web site.

(2)Existing law authorizes the commission to fix the rates and charges for every public utility and requires that those rates and charges be just and reasonable. Existing law, with certain exceptions, prohibits a public utility from changing any rate, except upon a showing before the commission and a finding by the commission that the new rate is justified. With certain exceptions, whenever any electrical, gas, heat, telephone, water, or sewer system corporation files an application to change any rate for the services or commodities furnished by it, existing law requires that the corporation furnish its customers notice of its application to the commission for approval of the new rate. This notice requirement does not apply to any rate change proposed by a corporation pursuant to an advice letter submitted to the commission filed pursuant to commission-established procedures for advice letters.

This bill would require each public utility that submits an application to change its rates to include in its application a summary of the application that can be understood by the utilitys ratepayers. The bill would require that this summary and the application be posted on the commissions Internet Web site and, if the utility has an Internet Web site, to be posted on the utilitys Internet Web site. Each public utility that maintains an Internet Web site would additionally be required to include on that site contact information for a utility official who can discuss the nature of the rate application.

(3)Every public utility is required by existing law to furnish such reports as the commission may require. No information furnished to the commission by a public utility, except those matters specifically required to be open to public inspection, are open to public inspection or made public except by order of the commission or a commissioner in the course of a hearing or proceeding. Any present or former officer or employee of the commission who divulges any information in violation of these provisions is guilty of a misdemeanor.

This bill would provide that if in a proceeding before the commission, a public utility, or subsidiary, affiliate, or holding company, files a pleading, report, or other document with the commission that is claimed to contain confidential information, it would be required to concurrently file a public version of the pleading, report, or other document with the commission that contains sufficient information for any other party to the proceeding to understand the nature of its contents. The bill would authorize any party to the proceeding to file a motion to make public a pleading, report, or other document filed under a claim of confidentiality. The bill would require an administrative law judge assigned to the proceeding or the assigned commissioner to hold a hearing on the motion and determine whether the pleading, report, or other document should be made public. The bill would authorize any party to seek review of the ruling or order of the administrative law judge or assigned commissioner on the motion by filing a motion for rehearing de novo before the full commission within 30 days of the date the ruling or order on the motion was issued.

(4)Existing law requires the commission to publish and maintain certain documents and information, including making available on the commissions Internet Web site, the commissions annual work plan, general orders, and Rules of Practice and Procedure, the proposed and alternate proposed decisions and resolutions, the agenda, agenda item documents, rulings of the commission, and adopted decisions and resolutions of the commission. Included in the materials that the commission is required to publish and maintain on its Internet Web site are docket cards that list by title and date of filing or issuance all documents filed and all decisions or rulings issued in those proceedings.

This bill would require that each document that the commission distributes to any service-of-process list be docketed and identified on the commissions Internet Web site. The bill would require the commission to adopt rules providing for posting on its Internet Web site of all comments, workshop reports, hearing exhibits, including the exhibit number assigned and whether the exhibit has been offered and received in evidence, hearing transcripts, and other documentary information included in the record of its proceedings.

(5)Existing law requires the commission to establish an office of the public advisor and to appoint a public advisor. Existing law requires the office of the public advisor to assist members of the public and ratepayers who desire to testify before or present information to the commission in any hearing or proceeding of the commission.

This bill would add legislative findings and declarations relative to improving the transparency of commission regulatory activities. The bill would require the public advisor to be responsible for ensuring that the activities of the commission are as transparent to the public as reasonably possible and consistent with law. The bill would require the public advisor to work with all divisions of the commission to ensure that the commissions Internet Web site provides adequate transparency in the information provided to the public. The bill would require the commission to post on its Internet Web site a summary, as specified, of all electricity procurement contracts entered into by an electrical corporation during the previous 3 years, the expenses of which the commission has approved as being just and reasonable, a list of all proceedings involving public utilities then pending before the commission with information, in summary form, as to the amount of any rate increase being sought, both in cumulative amount and by unit or other means billed to ratepayers, transcripts and available summaries of documents, evidence, testimony and proceedings before the commission or its administration law judges that are not subject to confidentiality, a list of all requests submitted to the commission pursuant to the California Public Records Act, all advice letters approved by the commission, and the calendars of each commissioner. The bill would require the public advisor to update, maintain, and post the commissions service-of-process lists on the commissions Internet Web site in an electronic form that may be used by any party to complete service of process. The bill would require the commission to open a proceeding to reexamine a specified decision relative to confidentiality of electric procurement data and to modify the commissions confidentiality practices and procedures consistent with specified requirements. The bill would establish the Inspector General for the Public Utilities Commission within the California State Auditors Office to conduct oversight review and assess, audit, investigate, and report on the policies, practices, and procedures of the commission under the guidance, direction, supervision, and authority of the State Auditor.

(6)Existing law requires the commission to determine whether a proceeding requires a hearing and, if so, to determine whether the matter requires a quasi-legislative, an adjudication, or a ratesetting hearing. Upon initiating a hearing, the commission is required to assign one or more commissioners to oversee the case and an administrative law judge where appropriate. Existing law requires the assigned commissioner to schedule a prehearing conference and to issue, by order or ruling, a scoping memo that describes the issues to be considered and the applicable timetable for resolution.

This bill would, in matters the commission has determined require a hearing, require the commission to use all-party conferences as a tool for listening to the parties perspectives on the most important issues and to facilitate public discussion between and among parties and commissioners. The bill would require that discussions at an all-party conference not rely on evidence outside the evidentiary record existing at the time of the all-party conference. The bill would require the assigned commissioner to convene an all-parties conference as soon as practicable after the prehearing conference, and before completing the scoping memo, to discuss the substantive matter to be decided in the proceeding and prospects for resolving issues that would otherwise be litigated. The bill would require the commission to hold an all-party conference before a quorum of commissioners, after a proposed decision is issued in all contested cases, unless all parties waive this requirement and a majority of commissioners concur with that waiver. The bill would require that a transcript be kept for each all-party conference and that the transcript be made a part of the record of the proceeding.

(7)Existing law prohibits an officer, employee, or agent of the commission 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 adjudicatory proceeding. Existing law permits an officer, employee, or agent of the commission 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 prohibits the officer, employee, or agent from participating in the decision of the commission to accept or reject the settlement, except as a witness or counsel in an open hearing or a specified closed hearing.

This bill would prohibit an attorney or other staff member who has served as a prosecutor or advocate at any stage of an adjudicatory proceeding before the commission from meeting with any commissioner regarding the matter in which the attorney or staff member has served unless all parties are present.

(8)This bill would require the commission to adopt rules providing for comments from the public, including comments made at noticed public participation hearings of the commission, to be included in the record of its proceedings and would require that the assigned commissioner, or a quorum of the commission, convene and attend each public participation proceeding.

(9)This bill would incorporate additional changes in Sections 311.5 and 1701 of the Public Utilities Code, proposed by SB 48, to be operative only if SB 48 and this bill are both chaptered and become effective on or before January 1, 2016, and this bill is chaptered last.

(10)Under existing law, a violation of the Public Utilities Act or any order, decision, rule, direction, demand, or requirement of the commission is a crime.

Because certain provisions of this bill would be a part of the act and because a violation of an order or decision of the commission implementing its requirements would be a crime, the bill would impose a state-mandated local program by creating a new crime.

The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.

This bill would provide that no reimbursement is required by this act for a specified reason.

(1)Under existing law, the Public Utilities Commission has regulatory authority over public utilities, including electrical corporations, gas corporations, heat corporations, telegraph corporations, telephone corporations, and water corporations. The California Constitution authorizes the commission to establish rules, examine records, and prescribe a uniform system of accounts for all public utilities. The Public Utilities Act requires the commission to inspect and audit the books and records of electrical corporations, gas corporations, heat corporations, telegraph corporations, telephone corporations, and water corporations for regulatory and tax purposes. An inspection and audit is required to be done at least every 3 years if the utility has over 1,000 customers and at least every 5 years if the utility has 1,000 or fewer customers. The act requires that reports of the inspections and audit and other pertinent information be furnished to the State Board of Equalization for use in the assessment of the public utilities.

This bill would delete the requirement that the reports of the inspections and audit and other pertinent information be furnished to the State Board of Equalization for use in the assessment of the public utilities and instead require that the inspections and audit and other pertinent information be posted on the commissions Internet Web site.

(2)Existing law authorizes the commission to fix the rates and charges for every public utility and requires that those rates and charges be just and reasonable. Existing law, with certain exceptions, prohibits a public utility from changing any rate, except upon a showing before the commission and a finding by the commission that the new rate is justified. With certain exceptions, whenever any electrical, gas, heat, telephone, water, or sewer system corporation files an application to change any rate for the services or commodities furnished by it, existing law requires that the corporation furnish its customers notice of its application to the commission for approval of the new rate. This notice requirement does not apply to any rate change proposed by a corporation pursuant to an advice letter submitted to the commission filed pursuant to commission-established procedures for advice letters.

This bill would require each public utility that submits an application to change its rates to include in its application a summary of the application that can be understood by the utilitys ratepayers. The bill would require that this summary and the application be posted on the commissions Internet Web site and, if the utility has an Internet Web site, to be posted on the utilitys Internet Web site. Each public utility that maintains an Internet Web site would additionally be required to include on that site contact information for a utility official who can discuss the nature of the rate application.

(3)Every public utility is required by existing law to furnish such reports as the commission may require. No information furnished to the commission by a public utility, except those matters specifically required to be open to public inspection, are open to public inspection or made public except by order of the commission or a commissioner in the course of a hearing or proceeding. Any present or former officer or employee of the commission who divulges any information in violation of these provisions is guilty of a misdemeanor.

This bill would provide that if in a proceeding before the commission, a public utility, or subsidiary, affiliate, or holding company, files a pleading, report, or other document with the commission that is claimed to contain confidential information, it would be required to concurrently file a public version of the pleading, report, or other document with the commission that contains sufficient information for any other party to the proceeding to understand the nature of its contents. The bill would authorize any party to the proceeding to file a motion to make public a pleading, report, or other document filed under a claim of confidentiality. The bill would require an administrative law judge assigned to the proceeding or the assigned commissioner to hold a hearing on the motion and determine whether the pleading, report, or other document should be made public. The bill would authorize any party to seek review of the ruling or order of the administrative law judge or assigned commissioner on the motion by filing a motion for rehearing de novo before the full commission within 30 days of the date the ruling or order on the motion was issued.

(4)Existing law requires the commission to publish and maintain certain documents and information, including making available on the commissions Internet Web site, the commissions annual work plan, general orders, and Rules of Practice and Procedure, the proposed and alternate proposed decisions and resolutions, the agenda, agenda item documents, rulings of the commission, and adopted decisions and resolutions of the commission. Included in the materials that the commission is required to publish and maintain on its Internet Web site are docket cards that list by title and date of filing or issuance all documents filed and all decisions or rulings issued in those proceedings.

This bill would require that each document that the commission distributes to any service-of-process list be docketed and identified on the commissions Internet Web site. The bill would require the commission to adopt rules providing for posting on its Internet Web site of all comments, workshop reports, hearing exhibits, including the exhibit number assigned and whether the exhibit has been offered and received in evidence, hearing transcripts, and other documentary information included in the record of its proceedings.

(5)Existing law requires the commission to establish an office of the public advisor and to appoint a public advisor. Existing law requires the office of the public advisor to assist members of the public and ratepayers who desire to testify before or present information to the commission in any hearing or proceeding of the commission.

This bill would add legislative findings and declarations relative to improving the transparency of commission regulatory activities. The bill would require the public advisor to be responsible for ensuring that the activities of the commission are as transparent to the public consistent with these legislative findings and directions, the California Public Records Act, the Bagley-Keene Open Meeting Act, and other specified matter. as reasonably possible and consistent with law. The bill would require the public advisor to have independent responsibility for overseeing the commissions Internet Web site and work with all divisions of the commission to ensure that the commissions Internet Web site provides adequate transparency in the information provided to the public. The bill would require the commission to post on its Internet Web site a summary, as specified, of all electricity procurement contracts entered into by an electrical corporation during the previous 3 years, the expenses of which the commission has approved as being just and reasonable, a list of all proceedings involving public utilities then pending before the commission with information, in summary form, as to the amount of any rate increase being sought, both in cumulative amount and by unit or other means billed to ratepayers, transcripts and available summaries of documents, evidence, testimony and proceedings before the commission or its administration law judges that are not subject to confidentiality, a list of all requests submitted to the commission pursuant to the California Public Records Act, and all advice letters approved by the commission. commission, and the calendars of each commissioner. The bill would require the public advisor to update, maintain, and post the commissions service-of-process lists on the commissions Internet Web site in an electronic form that may be used by any party to complete service of process. The bill would require the commission to open a proceeding to reexamine a specified decision relative to confidentiality of electric procurement data and to modify the commissions confidentiality practices and procedures consistent with specified requirements. The bill would establish the Inspector General for the Public Utilities Commission within the California State Auditors Office to conduct oversight review and assess, audit, investigate, and report on the policies, practices, and procedures of the commission under the guidance, direction, supervision, and authority of the State Auditor.

(6)Existing law requires the commission to determine whether a proceeding requires a hearing and, if so, to determine whether the matter requires a quasi-legislative, an adjudication, or a ratesetting hearing. Upon initiating a hearing, the commission is required to assign one or more commissioners to oversee the case and an administrative law judge where appropriate. Existing law requires the assigned commissioner to schedule a prehearing conference and to issue, by order or ruling, a scoping memo that describes the issues to be considered and the applicable timetable for resolution.

This bill would would, in matters the commission has determined require a hearing, require the commission to use all-party conferences as a tool for listening to the parties perspectives on the most important issues and to facilitate public discussion between and among parties and commissioners. The bill would require that discussions at an all-party conference not rely on evidence outside the evidentiary record existing at the time of the all-party conference. The bill would require the assigned commissioner to convene an all-parties meeting conference as soon as practicable after the parties in a proceeding are known prehearing conference, and before completing the scoping memo, to discuss the substantive matter to be decided in the proceeding and prospects for resolving issues that would otherwise be litigated. The bill would require an assigned commissioner to attend all hearings in a proceeding. the commission to hold an all-party conference before a quorum of commissioners, after a proposed decision is issued in all contested cases, unless all parties waive this requirement and a majority of commissioners concur with that waiver. The bill would require that a transcript be kept for each all-party conference and that the transcript be made a part of the record of the proceeding.

(7)Existing law prohibits an officer, employee, or agent of the commission 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 adjudicatory proceeding. Existing law permits an officer, employee, or agent of the commission 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 prohibits the officer, employee, or agent from participating in the decision of the commission to accept or reject the settlement, except as a witness or counsel in an open hearing or a specified closed hearing.

This bill would prohibit an attorney that is prosecuting a matter or other staff member who has served as a prosecutor or advocate at any stage of an adjudicatory proceeding before the commission from meeting with any commissioner regarding the matter that the attorney is prosecuting in which the attorney or staff member has served unless all parties are present.

(10)Under existing law, a violation of the Public Utilities Act or any order, decision, rule, direction, demand, or requirement of the commission is a crime.

Because certain provisions of this bill would be a part of the act and because a violation of an order or decision of the commission implementing its requirements would be a crime, the bill would impose a state-mandated local program by creating a new crime.

The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.

This bill would provide that no reimbursement is required by this act for a specified reason.

(1)Under existing law, the Public Utilities Commission has regulatory authority over public utilities, including electrical corporations, gas corporations, heat corporations, telegraph corporations, telephone corporations, and water corporations. The Public Utilities Act provides that the office of the commission be in the City and County of San Francisco, that the office always be open, legal holidays and nonjudicial days excepted, that the commission hold its sessions at least once in each calendar month in the City and County of San Francisco, and authorizes the commission to also meet at those other times and places as may be expedient and necessary for the proper performance of its duties. The Public Utilities Act requires that meetings of the commission be open and public in accordance with the provisions of a specified state open meeting law. The California Constitution authorizes the commission to establish rules, examine records, and prescribe a uniform system of accounts for all public utilities. The Public Utilities Act requires the commission to inspect and audit the books and records of electrical corporations, gas corporations, heat corporations, telegraph corporations, telephone corporations, and water corporations for regulatory and tax purposes. An inspection and audit is required to be done at least every 3 years if the utility has over 1,000 customers and at least every 5 years if the utility has 1,000 or fewer customers. The act requires that reports of the inspections and audit and other pertinent information be furnished to the State Board of Equalization for use in the assessment of the public utilities.

This bill would delete the requirement that the reports of the inspections and audit and other pertinent information be furnished to the State Board of Equalization for use in the assessment of the public utilities and instead require that the inspections and audit and other pertinent information be posted on the commissions Internet Web site.

(2)Existing law authorizes the commission to fix the rates and charges for every public utility and requires that those rates and charges be just and reasonable. Existing law, with certain exceptions, prohibits a public utility from changing any rate, except upon a showing before the commission and a finding by the commission that the new rate is justified. With certain exceptions, whenever any electrical, gas, heat, telephone, water, or sewer system corporation files an application to change any rate for the services or commodities furnished by it, existing law requires that the corporation furnish its customers notice of its application to the commission for approval of the new rate. This notice requirement does not apply to any rate change proposed by a corporation pursuant to an advice letter submitted to the commission filed pursuant to commission-established procedures for advice letters.

This bill would require each public utility that submits an application to change its rates to include in its application a summary of the application that can be understood by the utilitys ratepayers. The bill would require that this summary and the application be posted on the commissions Internet Web site and, if the utility has an Internet Web site, to be posted on the utilitys Internet Web site. Each public utility that maintains an Internet Web site would additionally be required to include on that site contact information for a utility official who can discuss the nature of the rate application.

(3)Every public utility is required by existing law to furnish such reports as the commission may require. No information furnished to the commission by a public utility, except those matters specifically required to be open to public inspection, are open to public inspection or made public except by order of the commission or a commissioner in the course of a hearing or proceeding. Any present or former officer or employee of the commission who divulges any information in violation of these provisions is guilty of a misdemeanor.

This bill would provide that if in a proceeding before the commission, a public utility, or subsidiary, affiliate, or holding company, files a pleading, report, or other document with the commission that is claimed to contain confidential information, it would be required to concurrently file a public version of the pleading, report, or other document with the commission that contains sufficient information for any other party to the proceeding to understand the nature of its contents. The bill would authorize any party to the proceeding to file a motion to make public a pleading, report, or other document filed under a claim of confidentiality. The bill would require an administrative law judge assigned to the proceeding or the assigned commissioner to hold a hearing on the motion and determine whether the pleading, report, or other document should be made public. The bill would authorize any party to seek review of the ruling or order of the administrative law judge or assigned commissioner on the motion by filing a motion for rehearing de novo before the full commission within 30 days of the date the ruling or order on the motion was issued.

(4)Existing law requires the commission to publish and maintain certain documents and information, including making available on the commissions Internet Web site, the commissions annual work plan, general orders, and Rules of Practice and Procedure, the proposed and alternate proposed decisions and resolutions, the agenda, agenda item documents, rulings of the commission, and adopted decisions and resolutions of the commission. Included in the materials that the commission is required to publish and maintain on its Internet Web site are docket cards that list by title and date of filing or issuance all documents filed and all decisions or rulings issued in those proceedings.

This bill would require that each document that the commission distributes to any service-of-process list be docketed and identified on the commissions Internet Web site.

(5)Existing law requires the commission to establish an office of the public advisor and to appoint a public advisor. Existing law requires the office of the public advisor to assist members of the public and ratepayers who desire to testify before or present information to the commission in any hearing or proceeding of the commission.

This bill would add legislative findings and declarations relative to improving the transparency of commission regulatory activities. The bill would require the public advisor to be responsible for ensuring that the activities of the commission are transparent to the public consistent with these legislative findings and directions, the California Public Records Act, the Bagley-Keene Open Meeting Act, and other specified matter. The bill would require the public advisor to have independent responsibility for overseeing the commissions Internet Web site and would require the commission to post on its Internet Web site a summary, as specified, of all electricity procurement contracts entered into by an electrical corporation during the previous 3 years, the expenses of which the commission has approved as being just and reasonable, a list of all proceedings involving public utilities then pending before the commission with information, in summary form, as to the amount of any rate increase being sought, both in cumulative amount and by unit or other means billed to ratepayers, transcripts and available summaries of documents, evidence, testimony and proceedings before the commission or its administration law judges that are not subject to confidentiality, a list of all requests submitted to the commission pursuant to the California Public Records Act, and all advice letters approved by the commission. The bill would require the public advisor to update, maintain, and post the commissions service-of-process lists on the commissions Internet Web site in an electronic form that may be used by any party to complete service of process. The bill would require the commission to open a proceeding to reexamine a specified decision relative to confidentiality of electric procurement data and to modify the commissions confidentiality practices and procedures consistent with specified requirements. The bill would require the California State Auditor to appoint an inspector general for the commission who would be authorized to audit and investigate the commissions activities and report any finding to the Legislature. establish the Inspector General for the Public Utilities Commission within the California State Auditors Office to conduct oversight review and assess, audit, investigate, and report on the policies, practices, and procedures of the commission under the guidance, direction, supervision, and authority of the State Auditor.

(6)Existing law requires the commission to determine whether a proceeding requires a hearing and, if so, to determine whether the matter requires a quasi-legislative, an adjudication, or a ratesetting hearing. Upon initiating a hearing, the commission is required to assign one or more commissioners to oversee the case and an administrative law judge where appropriate. Existing law requires the assigned commissioner to schedule a prehearing conference and to issue, by order or ruling, a scoping memo that describes the issues to be considered and the applicable timetable for resolution.

This bill would require the assigned commissioner to convene an all-parties meeting as soon as practicable after the parties in a proceeding are known to discuss the substantive matter to be decided in the proceeding and prospects for resolving issues that would otherwise be litigated. The bill would require an assigned commissioner to attend all hearings in a proceeding.

(7)Existing law prohibits an officer, employee, or agent of the commission 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 adjudicatory proceeding. Existing law permits an officer, employee, or agent of the commission 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 prohibits the officer, employee, or agent from participating in the decision of the commission to accept or reject the settlement, except as a witness or counsel in an open hearing or a specified closed hearing.

This bill would prohibit an attorney that is prosecuting a matter before the commission from meeting with any commissioner regarding the matter that the attorney is prosecuting unless all parties are present.

(8)Under existing law, a violation of the Public Utilities Act or any order, decision, rule, direction, demand, or requirement of the commission is a crime.

Because certain provisions of this bill would be a part of the act and because a violation of an order or decision of the commission implementing its requirements would be a crime, the bill would impose a state-mandated local program by creating a new crime.

The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.

This bill would provide that no reimbursement is required by this act for a specified reason.

(1)Under existing law, the Public Utilities Commission has regulatory authority over public utilities, including electrical corporations, gas corporations, heat corporations, telegraph corporations, telephone corporations, and water corporations. Existing law requires the Governor to designate the president of the commission from among its members and requires the president to direct the executive director, the attorney, and other staff of the commission, except for the Office of Ratepayer Advocates. Existing law requires the commission to appoint an executive director who is responsible for the commissions executive and administrative duties and to organize, coordinate, supervise, and direct the operations and affairs of the commission and expedite all matters within the commissions jurisdiction. Existing law authorizes the executive director to employ those officers, administrative law judges, experts, engineers, statisticians, accountants, inspectors, clerks, and employees as the executive director deems necessary to carry out the provisions of the Public Utilities Act or to perform the duties and exercise the powers conferred upon the commission by law. The Public Utilities Act provides that the office of the commission be in the City and County of San Francisco, that the office always be open, legal holidays and nonjudicial days excepted, that the commission hold its sessions at least once in each calendar month in the City and County of San Francisco, and authorizes the commission to also meet at those other times and places as may be expedient and necessary for the proper performance of its duties. The Public Utilities Act requires that meetings of the commission be open and public in accordance with the provisions of a specified state open meeting law.

This bill would require that each commissioner hold office hours and be available to meet with members of the public at least once a month in San Francisco or Los Angeles.

(2)The California Constitution authorizes the commission to establish rules, examine records, and prescribe a uniform system of accounts for all public utilities. The Public Utilities Act requires the commission to inspect and audit the books and records of electrical corporations, gas corporations, heat corporations, telegraph corporations, telephone corporations, and water corporations for regulatory and tax purposes. An inspection and audit is required to be done at least every 3 years if the utility has over 1,000 customers and at least every 5 years if the utility has 1,000 or fewer customers. The act requires that reports of the inspections and audit and other pertinent information be furnished to the State Board of Equalization for use in the assessment of the public utilities.

This bill would delete the requirement that the reports of the inspections and audit and other pertinent information be furnished to the State Board of Equalization for use in the assessment of the public utilities and instead require that the inspections and audit and other pertinent information be posted on the commissions Internet Web site.

(3)Existing law authorizes the commission to fix the rates and charges for every public utility and requires that those rates and charges be just and reasonable. Existing law, with certain exceptions, prohibits a public utility from changing any rate, except upon a showing before the commission and a finding by the commission that the new rate is justified. With certain exceptions, whenever any electrical, gas, heat, telephone, water, or sewer system corporation files an application to change any rate for the services or commodities furnished by it, existing law requires that the corporation furnish its customers notice of its application to the commission for approval of the new rate. This notice requirement does not apply to any rate change proposed by a corporation pursuant to an advice letter submitted to the commission filed pursuant to commission-established procedures for advice letters.

This bill would require each public utility that submits an application to change its rates to include in its application a summary of the application that can be understood by the utilitys ratepayers. The bill would require that this summary and the application be posted on the commissions Internet Web site and, if the utility has an Internet Web site, to be posted on the utilitys Internet Web site. Each public utility that maintains an Internet Web site would additionally be required to include on that site contact information for a utility official who can discuss the nature of the rate application.

(4)Every public utility is required by existing law to furnish such reports as the commission may require. No information furnished to the commission by a public utility, except those matters specifically required to be open to public inspection, are open to public inspection or made public except by order of the commission or a commissioner in the course of a hearing or proceeding. Any present or former officer or employee of the commission who divulges any information in violation of these provisions is guilty of a misdemeanor.

This bill would provide that if in a proceeding before the commission, a public utility, or subsidiary, affiliate, or holding company, files a pleading, report, or other document with the commission that is claimed to contain confidential information, it would be required to concurrently file a public version of the pleading, report, or other document with the commission that contains sufficient information for any other party to the proceeding to understand the nature of its contents. The bill would authorize any party to the proceeding to file a motion to make public a pleading, report, or other document filed under a claim of confidentiality. The bill would require an administrative law judge assigned to the proceeding or the assigned commissioner to hold a hearing on the motion and determine whether the pleading, report, or other document should be made public. The bill would authorize any party to seek review of the ruling or order of the administrative law judge or assigned commissioner on the motion by filing a motion for rehearing de novo before the full commission within 30 days of the date the ruling or order on the motion was issued.

(5)Existing law requires the commission to publish and maintain certain documents and information, including making available on the commissions Internet Web site, the commissions annual work plan, general orders, and Rules of Practice and Procedure, the proposed and alternate proposed decisions and resolutions, the agenda, agenda item documents, rulings of the commission, and adopted decisions and resolutions of the commission. Included in the materials that the commission is required to publish and maintain on its Internet Web site are docket cards that list by title and date of filing or issuance all documents filed and all decisions or rulings issued in those proceedings.

This bill would require that each document that the commission distributes to any service-of-process list be docketed and identified on the commissions Internet Web site.

(6)Existing law requires the commission to establish an office of the public advisor and to appoint a public advisor. Existing law requires the office of the public advisor to assist members of the public and ratepayers who desire to testify before or present information to the commission in any hearing or proceeding of the commission.

This bill would add legislative findings and declarations relative to improving the transparency of commission regulatory activities. The bill would require the public advisor to be responsible for ensuring that the activities of the commission are transparent to the public consistent with these legislative findings and directions, the California Public Records Act, the Bagley-Keene Open Meeting Act, and other specified matter. The bill would require the public advisor to have independent responsibility for overseeing the commissions Internet Web site and would require the commission to post on its Internet Web site a summary, as specified, of all electricity procurement contracts entered into by an electrical corporation during the previous 3 years, the expenses of which the commission has approved as being just and reasonable, a list of all proceedings involving public utilities then pending before the commission with information, in summary form, as to the amount of any rate increase being sought, both in cumulative amount and by unit or other means billed to ratepayers, transcripts and available summaries of documents, evidence, testimony and proceedings before the commission or its administration law judges that are not subject to confidentiality, a list of all requests submitted to the commission pursuant to the California Public Records Act, and all advice letters approved by the commission. The bill would require the public advisor to update, maintain, and post the commissions service-of-process lists on the commissions Internet Web site in an electronic form that may be used by any party to complete service of process. The bill would require the commission to open a proceeding to reexamine a specified decision relative to confidentiality of electric procurement data and to modify the commissions confidentiality practices and procedures consistent with specified requirements. The bill would require the California State Auditor to appoint an inspector general for the commission who would be authorized to audit and investigate the commissions activities and report any finding to the Legislature.

(7)Existing law requires the commission to determine whether a proceeding requires a hearing and, if so, to determine whether the matter requires a quasi-legislative, an adjudication, or a ratesetting hearing. Upon initiating a hearing, the commission is required to assign one or more commissioners to oversee the case and an administrative law judge where appropriate. Existing law requires the assigned commissioner to schedule a prehearing conference and to issue, by order or ruling, a scoping memo that describes the issues to be considered and the applicable timetable for resolution.

This bill would require the assigned commissioner to convene an all-parties meeting as soon as practicable after the parties in a proceeding are known to discuss the substantive matter to be decided in the proceeding and prospects for resolving issues that would otherwise be litigated. The bill would require an assigned commissioner to attend all hearings in a proceeding.

(8)Existing law prohibits an officer, employee, or agent of the commission 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 adjudicatory proceeding. Existing law permits an officer, employee, or agent of the commission 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 prohibits the officer, employee, or agent from participating in the decision of the commission to accept or reject the settlement, except as a witness or counsel in an open hearing or a specified closed hearing.

This bill would prohibit an attorney that is prosecuting a matter before the commission from meeting with any commissioner regarding the matter that the attorney is prosecuting unless all parties are present.

(9)Under existing law, a violation of the Public Utilities Act or any order, decision, rule, direction, demand, or requirement of the commission is a crime.

Because certain provisions of this bill would be a part of the act and because a violation of an order or decision of the commission implementing its requirements would be a crime, the bill would impose a state-mandated local program by creating a new crime.

The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.

This bill would provide that no reimbursement is required by this act for a specified reason.

(1)Under existing law, the Public Utilities Commission has regulatory authority over public utilities, including electrical corporations, gas corporations, heat corporations, telegraph corporations, telephone corporations, and water corporations. Existing law requires the Governor to designate the president of the commission from among its members and requires the president to direct the executive director, the attorney, and other staff of the commission, except for the Office of Ratepayer Advocates. Existing law requires the commission to appoint an executive director who is responsible for the commissions executive and administrative duties and to organize, coordinate, supervise, and direct the operations and affairs of the commission and expedite all matters within the commissions jurisdiction. Existing law authorizes the executive director to employ those officers, administrative law judges, experts, engineers, statisticians, accountants, inspectors, clerks, and employees as the executive director deems necessary to carry out the provisions of the Public Utilities Act or to perform the duties and exercise the powers conferred upon the commission by law.

This bill would prohibit the commission from reassigning any staff member from a duty or activity authorized by statute to another duty or activity unless the Legislature has authorized personnel for that duty or activity. The bill would require the commissions internal auditor to report directly to the commission.

(2)The Public Utilities Act provides that the office of the commission be in the City and County of San Francisco, that the office always be open, legal holidays and nonjudicial days excepted, that the commission hold its sessions at least once in each calendar month in the City and County of San Francisco, and authorizes the commission to also meet at those other times and places as may be expedient and necessary for the proper performance of its duties. The Public Utilities Act requires that meetings of the commission be open and public in accordance with the provisions of a specified state open meeting law.

This bill would require that each commissioner hold office hours and be available to meet with members of the public at least once a month in San Francisco or Los Angeles.

(3)The California Constitution authorizes the commission to establish rules, examine records, and prescribe a uniform system of accounts for all public utilities. The Public Utilities Act requires the commission to inspect and audit the books and records of electrical corporations, gas corporations, heat corporations, telegraph corporations, telephone corporations, and water corporations for regulatory and tax purposes. An inspection and audit is required to be done at least every 3 years if the utility has over 1,000 customers and at least every 5 years if the utility has 1,000 or fewer customers. The act requires that reports of the inspections and audit and other pertinent information be furnished to the State Board of Equalization for use in the assessment of the public utilities.

This bill would delete the requirement that the reports of the inspections and audit and other pertinent information be furnished to the State Board of Equalization for use in the assessment of the public utilities and instead require that the inspections and audit and other pertinent information be posted on the commissions Internet Web site.

(4)Existing law authorizes the commission to fix the rates and charges for every public utility and requires that those rates and charges be just and reasonable. Existing law, with certain exceptions, prohibits a public utility from changing any rate, except upon a showing before the commission and a finding by the commission that the new rate is justified. With certain exceptions, whenever any electrical, gas, heat, telephone, water, or sewer system corporation files an application to change any rate for the services or commodities furnished by it, existing law requires that the corporation furnish its customers notice of its application to the commission for approval of the new rate. This notice requirement does not apply to any rate change proposed by a corporation pursuant to an advice letter submitted to the commission filed pursuant to commission-established procedures for advice letters.

This bill would require each public utility that submits an application to change its rates to include in its application a summary of the application that can be understood by the utilitys ratepayers. The bill would require that this summary and the application be posted on the commissions Internet Web site and, if the utility has an Internet Web site, to be posted on the utilitys Internet Web site. Each public utility that maintains an Internet Web site would additionally be required to include on that site contact information for a utility official who can discuss the nature of the rate application.

(5)Every public utility is required by existing law to furnish such reports as the commission may require. No information furnished to the commission by a public utility, except those matters specifically required to be open to public inspection, are open to public inspection or made public except by order of the commission or a commissioner in the course of a hearing or proceeding. Any present or former officer or employee of the commission who divulges any information in violation of these provisions is guilty of a misdemeanor.

This bill would provide that if in a proceeding before the commission, a public utility, or subsidiary, affiliate, or holding company, seeks to file files a pleading, report, or other document with the commission that preserves the confidentiality of information contained therein, is claimed to contain confidential information, it would be required to concurrently file a public version of the pleading, report, or other document with the commission that contains sufficient information for any other party to the proceeding to understand the nature of its contents. The bill would authorize any party to the proceeding to file a motion to make public a pleading, report, or other document filed under a claim of confidentiality. The bill would require an administrative law judge assigned to the proceeding or the assigned commissioner to hold a hearing on the motion and determine whether the pleading, report, or other document should be made public. The bill would authorize any party to seek review of the ruling or order of the administrative law judge or assigned commissioner on the motion by filing a motion for rehearing de novo before the full commission within 30 days of the date the ruling or order on the motion was issued.

(6)Existing law requires the commission to publish and maintain certain documents and information, including making available on the commissions Internet Web site, the commissions annual work plan, general orders, and Rules of Practice and Procedure, the proposed and alternate proposed decisions and resolutions, the agenda, agenda item documents, rulings of the commission, and adopted decisions and resolutions of the commission. Included in the materials that the commission is required to publish and maintain on its Internet Web site are docket cards that list by title and date of filing or issuance all documents filed and all decisions or rulings issued in those proceedings.

This bill would require that each document that the commission distributes to any service-of-process list be docketed and identified on the commissions Internet Web site.

(7)Existing law requires the commission to establish an office of the public advisor and to appoint a public advisor. Existing law requires the office of the public advisor to assist members of the public and ratepayers who desire to testify before or present information to the commission in any hearing or proceeding of the commission.

This bill would add legislative findings and declarations relative to improving the transparency of commission regulatory activities. The bill would require the public advisor to be responsible for ensuring that the activities of the commission are transparent to the public consistent with these legislative findings and directions, the California Public Records Act, the Bagley-Keene Open Meeting Act, and other specified matter. The bill would require the public advisor to have independent responsibility for overseeing the commissions Internet Web site and would require the commission to post on its Internet Web site a summary, as specified, of all electricity procurement contracts entered into by an electrical corporation during the previous 3 years, the expenses of which the commission has approved as being just and reasonable, a list of all proceedings involving public utilities then pending before the commission with information, in summary form, as to the amount of any rate increase being sought, both in cumulative amount and by unit or other means billed to ratepayers, transcripts and available summaries of documents, evidence, testimony and proceedings before the commission or its administration law judges that are not subject to confidentiality, a list of all requests submitted to the commission pursuant to the California Public Records Act, and all advice letters approved by the commission. The bill would require the public advisor to update, maintain, and post the commissions service-of-process lists on the commissions Internet Web site in an electronic form that may be used by any party to complete service of process. The bill would require the commission to open a proceeding to reexamine a specified decision relative to confidentiality of electric procurement data. data and to modify the commissions confidentiality practices and procedures consistent with specified requirements. The bill would require the California State Auditor to appoint an inspector general for the commission who would be authorized to audit and investigate the commissions activities and report any finding to the Legislature.

(8)Existing law requires the commission to determine whether a proceeding requires a hearing and, if so, to determine whether the matter requires a quasi-legislative, an adjudication, or a ratesetting hearing. Upon initiating a hearing, the commission is required to assign one or more commissioners to oversee the case and an administrative law judge where appropriate. Existing law requires the assigned commissioner to schedule a prehearing conference and to issue, by order or ruling, a scoping memo that describes the issues to be considered and the applicable timetable for resolution.

This bill would require the assigned commissioner to convene an all-parties meeting as soon as practicable after the parties in a proceeding are known to discuss the substantive matter to be decided in the proceeding and prospects for resolving issues that would otherwise be litigated. The bill would require an assigned commissioner to attend all hearings in a proceeding.

(9)Existing law prohibits an officer, employee, or agent of the commission 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 adjudicatory proceeding. Existing law permits an officer, employee, or agent of the commission 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 prohibits the officer, employee, or agent from participating in the decision of the commission to accept or reject the settlement, except as a witness or counsel in an open hearing or a specified closed hearing.

This bill would prohibit an attorney that is prosecuting a matter before the commission from meeting with any commissioner regarding the matter that the attorney is prosecuting unless all parties are present.

(10)Under existing law, a violation of the Public Utilities Act or any order, decision, rule, direction, demand, or requirement of the commission is a crime.

Because certain provisions of this bill would be a part of the act and because a violation of an order or decision of the commission implementing its requirements would be a crime, the bill would impose a state-mandated local program by creating a new crime.

The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.

This bill would provide that no reimbursement is required by this act for a specified reason.

(1)Under existing law, the Public Utilities Commission has regulatory authority over public utilities, including electrical corporations, gas corporations, heat corporations, telegraph corporations, telephone corporations, and water corporations. Existing law requires the Governor to designate the president of the commission from among its members and requires the president to direct the executive director, the attorney, and other staff of the commission, except for the Office of Ratepayer Advocates. Existing law requires the commission to appoint an executive director who is responsible for the commissions executive and administrative duties and to organize, coordinate, supervise, and direct the operations and affairs of the commission and expedite all matters within the commissions jurisdiction. Existing law authorizes the executive director to employ those officers, administrative law judges, experts, engineers, statisticians, accountants, inspectors, clerks, and employees as the executive director deems necessary to carry out the provisions of the Public Utilities Act or to perform the duties and exercise the powers conferred upon the commission by law.

This bill would prohibit the commission from reassigning any staff member from a duty or activity authorized by statute to another duty or activity unless the Legislature has authorized personnel for that duty or activity. The bill would require the commissions internal auditor to report directly to the commission.

(3)The California Constitution authorizes the commission to establish rules, examine records, and prescribe a uniform system of accounts for all public utilities. The Public Utilities Act requires the commission to inspect and audit the books and records of electrical corporations, gas corporations, heat corporations, telegraph corporations, telephone corporations, and water corporations for regulatory and tax purposes. An inspection and audit is required to be done at least every 3 years if the utility has over 1,000 customers and at least every 5 years if the utility has 1,000 or fewer customers. The act requires that reports of the inspections and audit and other pertinent information be furnished to the State Board of Equalization for use in the assessment of the public utilities.

This bill would delete the requirement that the reports of the inspections and audit and other pertinent information be furnished to the State Board of Equalization for use in the assessment of the public utilities and instead require that the inspections and audit and other pertinent information be posted on the commissions Internet Web site.

(4)Existing law authorizes the commission to fix the rates and charges for every public utility and requires that those rates and charges be just and reasonable. Existing law, with certain exceptions, prohibits a public utility from changing any rate, except upon a showing before the commission and a finding by the commission that the new rate is justified. With certain exceptions, whenever any electrical, gas, heat, telephone, water, or sewer system corporation files an application to change any rate for the services or commodities furnished by it, existing law requires that the corporation furnish its customers notice of its application to the commission for approval of the new rate. This notice requirement does not apply to any rate change proposed by a corporation pursuant to an advice letter submitted to the commission filed pursuant to commission-established procedures for advice letters.

This bill would require each public utility that submits an application to change its rates to include in its application a summary of the application that can be understood by the utilitys ratepayers. The bill would require that this summary and the application be posted on the commissions Internet Web site and, if the utility has an Internet Web site, to be posted on the utilitys Internet Web site. Each public utility that maintains an Internet Web site would additionally be required to include on that site contact information for a utility official who can discuss the nature of the rate application.

(5)Every public utility is required by existing law to furnish such reports as the commission may require. No information furnished to the commission by a public utility, except those matters specifically required to be open to public inspection, are open to public inspection or made public except by order of the commission or a commissioner in the course of a hearing or proceeding. Any present or former officer or employee of the commission who divulges any information in violation of these provisions is guilty of a misdemeanor.

This bill would provide that if in a proceeding before the commission, a public utility, or subsidiary, affiliate, or holding company, seeks to file a pleading, report, or other document with the commission that preserves the confidentiality of information contained therein, it would be required to file a public version of the pleading, report, or other document that contains sufficient information for any other party to the proceeding to understand the nature of its contents. The bill would authorize any party to the proceeding to file a motion to make public a pleading, report, or other document filed under a claim of confidentiality. The bill would require an administrative law judge assigned to the proceeding or the assigned commissioner to hold a hearing on the motion and determine whether the pleading, report, or other document should be made public. The bill would provide that specified information is by its nature public information and is not to be treated as confidential.

(6)Existing law requires the commission to publish and maintain certain documents and information, including making available on the commissions Internet Web site, the commissions annual work plan, general orders, and Rules of Practice and Procedure, the proposed and alternate proposed decisions and resolutions, the agenda, agenda item documents, rulings of the commission, and adopted decisions and resolutions of the commission. Included in the materials that the commission is required to publish and maintain on its Internet Web site are docket cards that list by title and date of filing or issuance all documents filed and all decisions or rulings issued in those proceedings.

(8)Existing law requires the commission to establish an office of the public advisor and to appoint a public advisor. Existing law requires the office of the public advisor to assist members of the public and ratepayers who desire to testify before or present information to the commission in any hearing or proceeding of the commission.

This bill would add legislative findings and declarations relative to improving the transparency of commission regulatory activities. The bill would require the public advisor to be responsible for ensuring that the activities of the commission are transparent to the public consistent with these legislative findings and directions, the California Public Records Act, the Bagley-Keene Open Meeting Act, and other specified matter. The bill would require the public advisor to have independent responsibility for overseeing the commissions Internet Web site and would require the commission to post on its Internet Web site a summary, as specified, of all electricity procurement contracts entered into by an electrical corporation during the previous 3 years, the expenses of which the commission has approved as being just and reasonable, a list of all proceedings involving public utilities then pending before the commission with information, in summary form, as to the amount of any rate increase being sought, both in cumulative amount and by unit or other means billed to ratepayers, transcripts and available summaries of documents, evidence, testimony and proceedings before the commission or its administration law judges that are not subject to confidentiality, a list of all requests submitted to the commission pursuant to the California Public Records Act, and all advice letters approved by the commission. The bill would require the public advisor to update, maintain, and post the commissions service-of-process lists on the commissions Internet Web site in an electronic form that may be used by any party to complete service of process. The bill would require the commission to open a proceeding to reexamine a specified decision relative to confidentiality of electric procurement data. The bill would require the California State Auditor to appoint an inspector general for the commission who would be authorized to audit and investigate the commissions activities and report any finding to the Legislature.

(11)Under existing law, a violation of the Public Utilities Act or any order, decision, rule, direction, demand, or requirement of the commission is a crime.

Because certain provisions of this bill would be a part of the act and because a violation of an order or decision of the commission implementing its requirements would be a crime, the bill would impose a state-mandated local program by creating a new crime.

The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.

This bill would provide that no reimbursement is required by this act for a specified reason.

(1)Under existing law, the Public Utilities Commission has regulatory authority over public utilities, including electrical corporations, gas corporations, heat corporations, telegraph corporations, telephone corporations, and water corporations. Existing law requires the Governor to designate the president of the commission from among its members and requires the president to direct the executive director, the attorney, and other staff of the commission, except for the Office of Ratepayer Advocates. Existing law requires the commission to appoint an executive director who is responsible for the commissions executive and administrative duties and to organize, coordinate, supervise, and direct the operations and affairs of the commission and expedite all matters within the commissions jurisdiction. Existing law authorizes the executive director to employ those officers, administrative law judges, experts, engineers, statisticians, accountants, inspectors, clerks, and employees as the executive director deems necessary to carry out the provisions of the Public Utilities Act or to perform the duties and exercise the powers conferred upon the commission by law.

This bill would prohibit the commission from reassigning any staff member from a duty or activity authorized by statute to another duty or activity unless the Legislature has authorized personnel for that duty or activity. The bill would require the commissions internal auditor to report directly to the commission.

(2)The California Constitution authorizes the commission to establish rules, examine records, and prescribe a uniform system of accounts for all public utilities. The Public Utilities Act requires the commission to inspect and audit the books and records of electrical corporations, gas corporations, heat corporations, telegraph corporations, telephone corporations, and water corporations for regulatory and tax purposes. An inspection and audit is required to be done at least every 3 years if the utility has over 1,000 customers and at least every 5 years if the utility has 1,000 or fewer customers. The act requires that reports of the inspections and audit and other pertinent information be furnished to the State Board of Equalization for use in the assessment of the public utilities.

This bill would delete the requirement that the reports of the inspections and audit and other pertinent information be furnished to the State Board of Equalization for use in the assessment of the public utilities and instead require that the inspections and audit and other pertinent information be posted on the commissions Internet Web site.

(3)Existing law authorizes the commission to fix the rates and charges for every public utility and requires that those rates and charges be just and reasonable. Existing law, with certain exceptions, prohibits a public utility from changing any rate, except upon a showing before the commission and a finding by the commission that the new rate is justified. With certain exceptions, whenever any electrical, gas, heat, telephone, water, or sewer system corporation files an application to change any rate for the services or commodities furnished by it, existing law requires that the corporation furnish its customers notice of its application to the commission for approval of the new rate. This notice requirement does not apply to any rate change proposed by a corporation pursuant to an advice letter submitted to the commission filed pursuant to commission-established procedures for advice letters.

This bill would require each public utility that submits an application to change its rates to include in its application a summary of the application that can be understood by the utilitys ratepayers. The bill would require that this summary and the application be posted on the commissions Internet Web site and, if the utility has an Internet Web site, to be posted on the utilitys Internet Web site. Each public utility that maintains an Internet Web site would additionally be required to include on that site contact information for a utility official who can discuss the nature of the rate application.

(4)Every public utility is required by existing law to furnish such reports as the commission may require. No information furnished to the commission by a public utility, except those matters specifically required to be open to public inspection, are open to public inspection or made public except by order of the commission or a commissioner in the course of a hearing or proceeding. Any present or former officer or employee of the commission who divulges any information in violation of these provisions is guilty of a misdemeanor.

This bill would provide that if in a proceeding before the commission, a public utility, or subsidiary, affiliate, or holding company, seeks to file a pleading, report, or other document with the commission that preserves the confidentiality of information contained therein, it would be required to file a public version of the pleading, report, or other document that contains sufficient information for any other party to the proceeding to understand the nature of its contents. The bill would authorize any party to the proceeding to file a motion to make public a pleading, report, or other document filed under a claim of confidentiality. The bill would require an administrative law judge assigned to the proceeding or the assigned commissioner to hold a hearing on the motion and determine whether the pleading, report, or other document should be made public. The bill would provide that specified information is by its nature public information and is not to be treated as confidential.

(5)Existing law requires the commission to publish and maintain certain documents and information, including making available on the commissions Internet Web site, the commissions annual work plan, general orders, and Rules of Practice and Procedure, the proposed and alternate proposed decisions and resolutions, the agenda, agenda item documents, rulings of the commission, and adopted decisions and resolutions of the commission.

Existing law requires the commission to establish an office of the public advisor and to appoint a public advisor. Existing law requires the office of the public advisor to assist members of the public and ratepayers who desire to testify before or present information to the commission in any hearing or proceeding of the commission.

This bill would add legislative findings and declarations relative to improving the transparency of commission regulatory activities. The bill would require the public advisor to be responsible for ensuring that the activities of the commission are transparent to the public consistent with these legislative findings and directions, the California Public Records Act, the Bagley-Keene Open Meeting Act, and other specified matter. The bill would require the public advisor to have independent responsibility for overseeing the commissions Internet Web site and would require the commission to post on its Internet Web site a summary, as specified, of all electricity procurement contracts entered into by an electrical corporation during the previous 3 years, the expenses of which the commission has approved as being just and reasonable, a list of all proceedings involving public utilities then pending before the commission with information, in summary form, as to the amount of any rate increase being sought, both in cumulative amount and by unit or other means billed to ratepayers, transcripts and available summaries of documents, evidence, testimony and proceedings before the commission or its administration law judges that are not subject to confidentiality, a list of all requests submitted to the commission pursuant to the California Public Records Act, and all advice letters approved by the commission. The bill would require the commission to open a proceeding to reexamine a specified decision relative to confidentiality of electric procurement data. The bill would require the California State Auditor to appoint an inspector general for the commission who would be authorized to audit and investigate the commissions activities and report any finding to the Legislature.

(6)Under existing law, a violation of the Public Utilities Act or any order, decision, rule, direction, demand, or requirement of the commission is a crime.

Because certain provisions of this bill would be a part of the act and because a violation of an order or decision of the commission implementing its requirements would be a crime, the bill would impose a state-mandated local program by creating a new crime.

The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.

This bill would provide that no reimbursement is required by this act for a specified reason.

(1)Under existing law, the Public Utilities Commission has regulatory authority over public utilities, including electrical corporations, gas corporations, heat corporations, telegraph corporations, telephone corporations, and water corporations. Existing law requires the Governor to designate the president of the commission from among its members and requires the president to direct the executive director, the attorney, and other staff of the commission, except for the Division Office of Ratepayer Advocates. Existing law requires the commission to appoint an executive director who is responsible for the commissions executive and administrative duties and to organize, coordinate, supervise, and direct the operations and affairs of the commission and expedite all matters within the commissions jurisdiction. Existing law authorizes the executive director to employ those officers, administrative law judges, experts, engineers, statisticians, accountants, inspectors, clerks, and employees as the executive director deems necessary to carry out the provisions of the Public Utilities Act or to perform the duties and exercise the powers conferred upon the commission by law.

This bill would prohibit the commission from reassigning any staff member from a duty or activity authorized by statute to another duty or activity unless the Legislature has authorized personnel for that duty or activity. The bill would require the commissions internal auditor to report directly to the commission.

(2)The California Constitution authorizes the commission to establish rules, examine records, and prescribe a uniform system of accounts for all public utilities. The Public Utilities Act requires the commission to inspect and audit the books and records of electrical corporations, gas corporations, heat corporations, telegraph corporations, telephone corporations, and water corporations for regulatory and tax purposes. An inspection and audit is required to be done at least every 3 years if the utility has over 1,000 customers and at least every 5 years if the utility has 1,000 or fewer customers. The act requires that reports of the inspections and audit and other pertinent information be furnished to the State Board of Equalization for use in the assessment of the public utilities.

This bill would delete the requirement that the reports of the inspections and audit and other pertinent information be furnished to the State Board of Equalization for use in the assessment of the public utilities and instead require that the inspections and audit and other pertinent information be posted on the commissions Internet Web site.

(3)Existing law authorizes the commission to fix the rates and charges for every public utility and requires that those rates and charges be just and reasonable. Existing law, with certain exceptions, prohibits a public utility from changing any rate, except upon a showing before the commission and a finding by the commission that the new rate is justified. With certain exceptions, whenever any electrical, gas, heat, telephone, water, or sewer system corporation files an application to change any rate for the services or commodities furnished by it, existing law requires that the corporation furnish its customers notice of its application to the commission for approval of the new rate. This notice requirement does not apply to any rate change proposed by a corporation pursuant to an advice letter submitted to the commission filed pursuant to commission-established procedures for advice letters.

This bill would require each public utility that submits an application to change its rates to include in its application a summary of the application that can be understood by the utilitys ratepayers. The bill would require that this summary and the application be posted on the commissions Internet Web site and, if the utility has an Internet Web site, to be posted on the utilitys Internet Web site. Each public utility that maintains an Internet Web site would additionally be required to include on that site contact information for a utility official who can discuss the nature of the rate application.

(4)Every public utility is required by existing law, law to furnish such reports as the commission may require. No information furnished to the commission by a public utility, except those matters specifically required to be open to public inspection, are open to public inspection or made public except by order of the commission or a commissioner in the course of a hearing or proceeding. Any present or former officer or employee of the commission who divulges any information in violation of these provisions is guilty of a misdemeanor.

This bill would provide that if in a proceeding before the commission, a public utility, or subsidiary, affiliate, or holding company, seeks to file a pleading, report, or other document with the commission that preserves the confidentiality of information contained therein, it would be required to file a public version of the pleading, report, or other document that contains sufficient information for any other party to the proceeding to understand the nature of its contents. The bill would authorize any party to the proceeding to file a motion to make public a pleading, report, or other document filed under a claim of confidentiality. The bill would require an administrative law judge assigned to the proceeding or the assigned commissioner to hold a hearing on the motion and determine whether the pleading, report, or other document should be made public. The bill would provide that specified information is by its nature public information and is not to be treated as confidential.

(5)Existing law requires the commission to publish and maintain certain documents and information, including making available on the commissions Internet Web site, the commissions annual work plan, general orders, and Rules of Practice and Procedure, the proposed and alternate proposed decisions and resolutions, the agenda, agenda item documents, rulings of the commission, and adopted decisions and resolutions of the commission.

Existing law requires the commission to establish an office of the public advisor and to appoint a public advisor. Existing law requires the office of the public advisor to assist members of the public and ratepayers who desire to testify before or present information to the commission in any hearing or proceeding of the commission.

This bill would add legislative findings and declarations relative to improving the transparency of commission regulatory activities. The bill would require the public advisor to be responsible for ensuring that the activities of the commission are transparent to the public consistent with these legislative findings and directions, the California Public Records Act, the Bagley-Keene Open Meeting Act, and other specified matter. The bill would require the public advisor to have independent responsibility for overseeing the commissions Internet Web site and would require the commission to post on its Internet Web site a summary, as specified, of all electricity procurement contracts entered into by an electrical corporation during the previous 3 years, the expenses of which the commission has approved as being just and reasonable, a list of all proceedings involving public utilities then pending before the commission with information, in summary form, as to the amount of any rate increase being sought, both in cumulative amount and by unit or other means billed to ratepayers, transcripts and available summaries of documents, evidence, testimony and proceedings before the commission or its administration law judges that are not subject to confidentiality, a list of all requests submitted to the commission pursuant to the California Public Records Act, and all advice letters approved by the commission. The bill would require the commission to open a proceeding to reexamine a specified decision relative to confidentiality of electric procurement data. The bill would require the California State Auditor to appoint an inspector general for the commission who would be authorized to audit and investigate the commissions activities and report any finding to the Legislature.

(6)The California Constitution provides that the Legislature has plenary power to establish the manner and scope of review of commission action in a court of record. Existing law provides that only the Supreme Court and the court of appeal have jurisdiction to review, reverse, correct, or annul any order or decision of the commission or to suspend or delay the execution or operation thereof, or to enjoin, restrain, or interfere with the commission in the performance of its official duties.

This bill would repeal the existing provisions of the Public Utilities Act pertaining to judicial review of commission decisions and would instead authorize any party to a proceeding aggrieved by a decision or order issued by the commission in the proceeding to obtain a review of the order in the superior court for the City and County of San Francisco or the County of Los Angeles, by filing in the court, within 60 days after the decision or order of the commission upon the application for rehearing, a written petition praying that the order of the commission be modified or set aside in whole or in part. The bill would require that a copy of the petition be transmitted by the clerk of the court to the commission and would require the commission to file with the court the record upon which the decision or order complained of was entered. The bill would provide that until the record in a proceeding has been filed in the court, the commission may at any time, upon reasonable notice and in such manner as it deems proper, modify or set aside, in whole or in part, any finding or order made or issued by it. The bill would provide that the superior courts for the City and County of San Francisco and the County of Los Angeles are entitled to reimbursement for reasonable and necessary costs of any trial or hearing for any matter brought seeking judicial review of a decision or order of the commission.

(7)Under existing law, a violation of the Public Utilities Act or any order, decision, rule, direction, demand, or requirement of the commission is a crime.

Because certain provisions of this bill would be a part of the act and because a violation of an order or decision of the commission implementing its requirements would be a crime, the bill would impose a state-mandated local program by creating a new crime.

The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.

This bill would provide that no reimbursement is required by this act for a specified reason.

(1)Under existing law, the Public Utilities Commission has regulatory authority over public utilities, including electrical corporations, gas corporations, heat corporations, telegraph corporations, telephone corporations, and water corporations. Existing law requires the Governor to designate the president of the commission from among its members and requires the president to direct the executive director, the attorney, and other staff of the commission, except for the Division of Ratepayer Advocates. Existing law requires the commission to appoint an executive director who is responsible for the commissions executive and administrative duties and to organize, coordinate, supervise, and direct the operations and affairs of the commission and expedite all matters within the commissions jurisdiction. Existing law authorizes the executive director to employ those officers, administrative law judges, experts, engineers, statisticians, accountants, inspectors, clerks, and employees as the executive director deems necessary to carry out the provisions of the Public Utilities Act or to perform the duties and exercise the powers conferred upon the commission by law.

This bill would prohibit the commission from reassigning any staff member from a duty or activity authorized by statute to another duty or activity unless the Legislature has authorized personnel for that duty or activity. The bill would require the commissions internal auditor to report directly to the president, executive director, and the attorney to the commission.

(2)The California Constitution authorizes the commission to establish rules, examine records, and prescribe a uniform system of accounts for all public utilities. The Public Utilities Act requires the commission to inspect and audit the books and records of electrical corporations, gas corporations, heat corporations, telegraph corporations, telephone corporations, and water corporations for regulatory and tax purposes. An inspection and audit is required to be done at least every 3 years if the utility has over 1,000 customers and at least every 5 years if the utility has 1,000 or fewer customers. The act requires that reports of the inspections and audit and other pertinent information be furnished to the State Board of Equalization for use in the assessment of the public utilities.

This bill would delete the requirement that the reports of the inspections and audit and other pertinent information be furnished to the State Board of Equalization for use in the assessment of the public utilities and instead require that the inspections and audit and other pertinent information be posted on the commissions Internet Web site.

(3)Existing law authorizes the commission to fix the rates and charges for every public utility and requires that those rates and charges be just and reasonable. Existing law, with certain exceptions, prohibits a public utility from changing any rate, except upon a showing before the commission and a finding by the commission that the new rate is justified. With certain exceptions, whenever any electrical, gas, heat, telephone, water, or sewer system corporation files an application to change any rate for the services or commodities furnished by it, existing law requires that the corporation furnish its customers notice of its application to the commission for approval of the new rate. This notice requirement does not apply to any rate change proposed by a corporation pursuant to an advice letter submitted to the commission filed pursuant to commission-established procedures for advice letters.

This bill would require each public utility that submits an application to change its rates to include in its application a summary of the application that can be understood by the utilitys ratepayers. The bill would require that this summary and the application be posted on the commissions Internet Web site and, if the utility has an Internet Web site, to be posted on the utilitys Internet Web site. Each public utility that maintains an Internet Web site would additionally be required to include on that site contact information for a utility official who can discuss the nature of the rate application.

(4)Every public utility is required by existing law, to furnish such reports as the commission may require. No information furnished to the commission by a public utility, except those matters specifically required to be open to public inspection, are open to public inspection or made public except by order of the commission or a commissioner in the course of a hearing or proceeding. Any present or former officer or employee of the commission who divulges any information in violation of these provisions is guilty of a misdemeanor.

This bill would provide that if in a proceeding before the commission, a public utility, or subsidiary, affiliate, or holding company, seeks to file a pleading, report, or other document with the commission that preserves the confidentiality of information contained therein, it would be required to file a public version of the pleading, report, or other document that contains sufficient information for any other party to the proceeding to understand the nature of its contents. The bill would authorize any party to the proceeding to file a motion to make public a pleading, report, or other document filed under a claim of confidentiality. The bill would require an administrative law judge assigned to the proceeding or the assigned commissioner to hold a hearing on the motion and determine whether the pleading, report, or other document should be made public. The bill would provide that specified information is by its nature public information and is not to be treated as confidential.

(5)Existing law requires the commission to publish and maintain certain documents and information, including making available on the commissions Internet Web site, the commissions annual work plan, general orders, and Rules of Practice and Procedure, the proposed and alternate proposed decisions and resolutions, the agenda, agenda item documents, rulings of the commission, and adopted decisions and resolutions of the commission.

This bill would add legislative findings and declarations relative to improving the transparency of commission regulatory activities. The bill would require the public advisor to be responsible for ensuring that the activities of the commission are transparent to the public consistent with these legislative findings and directions, the California Public Records Act, the Bagley-Keene Open Meeting Act, and other specified matter. The bill would require the public advisor to have independent responsibility for overseeing the commissions Internet Web site and would require the commission to post on its Internet Web site a summary, as specified, of all electricity procurement contracts entered into by an electrical corporation during the previous 3 years, the expenses of which the commission has approved as being just and reasonable, and a list of all proceedings involving public utilities with ratesetting cases then pending before the commission with information, in summary form, as to the amount of any rate increase being sought, both in cumulative amount and by unit or other means billed to ratepayers. ratepayers, transcripts and available summaries of documents, evidence, testimony and proceedings before the commission or its administration law judges that are not subject to confidentiality, a list of all requests submitted to the commission pursuant to the California Public Records Act, and all advice letters approved by the commission. The bill would require the commission to open a proceeding to reexamine a specified decision relative to confidentiality of electric procurement data. The bill would require the California State Auditor to appoint an inspector general for the commission who would be authorized to audit and investigate the commissions activities and report any finding to the Legislature.

(6)The California Constitution provides that the Legislature has plenary power to establish the manner and scope of review of commission action in a court of record. Existing law provides that only the Supreme Court and the court of appeal have jurisdiction to review, reverse, correct, or annul any order or decision of the commission or to suspend or delay the execution or operation thereof, or to enjoin, restrain, or interfere with the commission in the performance of its official duties.

(7)Under existing law, a violation of the Public Utilities Act or any order, decision, rule, direction, demand, or requirement of the commission is a crime.

Because certain provisions of this bill would be a part of the act and because a violation of an order or decision of the commission implementing its requirements would be a crime, the bill would impose a state-mandated local program by creating a new crime.

The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.

This bill would provide that no reimbursement is required by this act for a specified reason.

(1)Under existing law, the Public Utilities Commission has regulatory authority over public utilities, including electrical corporations, gas corporations, heat corporations, telegraph corporations, telephone corporations, and water corporations. Existing law requires the Governor to designate the president of the commission from among its members and requires the president to direct the executive director, the attorney, and other staff of the commission, except for the Division of Ratepayer Advocates. Existing law requires the commission to appoint an executive director who is responsible for the commissions executive and administrative duties and to organize, coordinate, supervise, and direct the operations and affairs of the commission and expedite all matters within the commissions jurisdiction. Existing law authorizes the executive director to employ those officers, administrative law judges, experts, engineers, statisticians, accountants, inspectors, clerks, and employees as the executive director deems necessary to carry out the provisions of the Public Utilities Act or to perform the duties and exercise the powers conferred upon the commission by law.

This bill would prohibit the commission from reassigning any staff member from a duty or activity authorized by statute to another duty or activity unless the Legislature has authorized personnel for that duty or activity. The bill would require the commissions internal auditor to report directly to the president, executive director, and the attorney to the commission.

(2)The California Constitution authorizes the commission to establish rules, examine records, and prescribe a uniform system of accounts for all public utilities. The Public Utilities Act requires the commission to inspect and audit the books and records of electrical corporations, gas corporations, heat corporations, telegraph corporations, telephone corporations, and water corporations for regulatory and tax purposes. An inspection and audit is required to be done at least every 3 years if the utility has over 1,000 customers and at least every 5 years if the utility has 1,000 or fewer customers. The act requires that reports of the inspections and audit and other pertinent information be furnished to the State Board of Equalization for use in the assessment of the public utilities.

This bill would delete the requirement that the reports of the inspections and audit and other pertinent information be furnished to the State Board of Equalization for use in the assessment of the public utilities and instead require that the inspections and audit and other pertinent information be posted on the commissions Internet Web site.

(3)Existing law authorizes the commission to fix the rates and charges for every public utility and requires that those rates and charges be just and reasonable. Existing law, with certain exceptions, prohibits a public utility from changing any rate, except upon a showing before the commission and a finding by the commission that the new rate is justified. With certain exceptions, whenever any electrical, gas, heat, telephone, water, or sewer system corporation files an application to change any rate for the services or commodities furnished by it, existing law requires that the corporation furnish its customers notice of its application to the commission for approval of the new rate. This notice requirement does not apply to any rate change proposed by a corporation pursuant to an advice letter submitted to the commission filed pursuant to commission-established procedures for advice letters.

This bill would require each public utility that submits an application to change its rates to include in its application a summary of the application that can be understood by the utilitys ratepayers. The bill would require that this summary be posted on the commissions Internet Web site and, if the utility has an Internet Web site, to be posted on the utilitys Internet Web site. Each public utility that maintains an Internet Web site would additionally be required to include on that site contact information for a utility official who can discuss the nature of the rate application.

(4)Every public utility is required by existing law, to furnish such reports as the commission may require. No information furnished to the commission by a public utility, except those matters specifically required to be open to public inspection, are open to public inspection or made public except by order of the commission or a commissioner in the course of a hearing or proceeding. Any present or former officer or employee of the commission who divulges any information in violation of these provisions is guilty of a misdemeanor.

This bill would provide that if in a proceeding before the commission, a public utility, or subsidiary, affiliate, or holding company, seeks to file a pleading, report, or other document with the commission that preserves the confidentiality of information contained therein, it would be required to file a public version of the pleading, report, or other document that contains sufficient information for any other party to the proceeding to understand the nature of its contents. The bill would authorize any party to the proceeding to file a motion to make public a pleading, report, or other document filed under a claim of confidentiality. The bill would require an administrative law judge assigned to the proceeding or the assigned commissioner to hold a hearing on the motion and determine whether the pleading, report, or other document should be made public.

(5)Existing law requires the commission to publish and maintain certain documents and information, including making available on the commissions Internet Web site, the commissions annual work plan, general orders, and Rules of Practice and Procedure, the proposed and alternate proposed decisions and resolutions, the agenda, agenda item documents, rulings of the commission, and adopted decisions and resolutions of the commission.

This bill would require the commission to post on its Internet Web site a summary, as specified, of all electricity procurement contracts entered into by an electrical corporation during the previous 3 years, the expenses of which the commission has approved as being just and reasonable, and a list of all public utilities with ratesetting cases then pending before the commission with information, in summary form, as to the amount of any rate increase being sought, both in cumulative amount and by unit or other means billed to ratepayers.

(6)The California Constitution provides that the Legislature has plenary power to establish the manner and scope of review of commission action in a court of record. Existing law provides that only the Supreme Court and the court of appeal have jurisdiction to review, reverse, correct, or annul any order or decision of the commission or to suspend or delay the execution or operation thereof, or to enjoin, restrain, or interfere with the commission in the performance of its official duties.

This bill would authorize an action to enforce the requirements of the Bagley-Keene Open Meeting Act or the California Public Records Act to be brought against the commission in the superior court.

(7)Under existing law, a violation of the Public Utilities Act or any order, decision, rule, direction, demand, or requirement of the commission is a crime.

Because certain provisions of this bill would be a part of the act and because a violation of an order or decision of the commission implementing its requirements would be a crime, the bill would impose a state-mandated local program by creating a new crime.

The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.

This bill would provide that no reimbursement is required by this act for a specified reason.

GOVERNOR'S VETO

GV Bill Id:AB 825

Author:(Rendon and Mark Stone)

As Enrolled Ver:September 16, 2015

2/3 vote

Original Committee Reference: U. & C.

SUMMARY: Proposes reforms to governance and operations at the California Public Utilities Commission (CPUC) to increase transparency and oversight over the activities of the CPUC.

The Senate amendments do the following:

1. Clarify that the Inspector General for the CPUC takes direction from the State Auditor, and provides funding for the Inspector General upon appropriation.

2. Delete provisions treating certain categories of documents as public.

3. Clarify the process for allowing parties to challenge confidentiality of documents in CPUC proceedings.

4. Clarify the role of the CPUC public advisor at the CPUC.

5. Establish "all party conferences" as part of the hearing process for commissioners.

6. Require public comments at hearings to be incorporated into the hearing's evidentiary records.

7. Require commissioners to hold public office hours and attend all hearings.

8. Require the CPUC's public advisor to update and maintain the CPUC's service of process lists.

9. Prohibit a CPUC attorney who prosecutes an action before the CPUC from meeting with a commissioner without all parties present.

10. Delete prohibition on reassignment of CPUC staff without statutory authority.

11. Delete requirement that internal CPUC auditors report directly to CPUC.

12. Make additional technical and clarifying changes.

EXISTING LAW:

1. Establishes the CPUC with five members appointed by the Governor and confirmed by the Senate, empowers it to regulate privately-owned public utilities in California, and specifies that the Legislature may prescribe additional classes of private corporations or other persons as public utilities. (California Constitution Article XII and Public Utilities Code Section 301)

2. Requires the CPUC to provide public copies of the agenda and related items prior to the start of any voting meeting of commissioners, and publish specified documents on the Internet. (Public Utilities Code Section 311.5)

3. Prohibits any information furnished to the CPUC by a public utility, or any business which is a subsidiary or affiliate of a public utility, or a corporation which holds a controlling interest in a public utility, except those matters specifically required to be open to public inspection, as specified, from being open to public inspection or made public, except on order of the CPUC, or by the CPUC or commissioner in the course of a hearing or proceeding. (Public Utilities Code Section 583)

4. Establishes the office of the public advisor, and requires the CPUC to appoint a public advisor in order to assist members of the public and ratepayers who desire to testify before or present information to the CPUC in any hearing or proceeding, and advise the CPUC on procedural matters relating to public participation in proceedings. Provides that the CPUC can employ staff as necessary to carry out the duties of the office of public advisor. (Public Utilities Code Section 321)

5. Requires the CPUC to determine whether a proceeding requires a hearing, and to determine whether the matter requires a quasi-legislative, adjudication, or a ratesetting hearing, and to establish regulations regarding ex parte communication on case categorization issues. (Public Utilities Code Section 1701.1)

FISCAL EFFECT: According to the Senate Appropriations Committee, this bill would have the following costs:

1. Ongoing costs of at least $170,000 and up to $1 million to increase the amount of information available on the CPUC Web site.

2. Ongoing costs of approximately $200,000 for the public advisor to have independent responsibility over the CPUC Web site.

3. Unknown costs to post the transcripts of documents, evidence, testimony, and proceedings online.

4. One-time costs of $157,000 annually for two years for a proceeding to reopen its confidentiality practices.

5. Ongoing costs of $626,000 annually for hearings to consider motions to make confidential documents public.

6. Unknown costs to require that the assigned commissioner attend all hearings in a proceeding.

7. Ongoing costs between $450,000 and $850,000 to appoint an inspector general from the State Auditor's office to the CPUC.

8. Ongoing costs of $220,000 annually to provide legal staff at the public advisor's office to ensure compliance with the Public Records Act and the Bagley-Keene Open Meeting Act. These costs may be offset by reduced workload in other CPUC divisions to oversee compliance.

COMMENTS:

1. Author’s Statement: "Transparency in how government makes its decisions remains a critical link to gaining the public's trust in those decisions. Recent media reports have shown that California Public Utilities Commission decisions lacked transparency, with some deals done in private meetings with investor-owned utility representatives. AB 825 addresses several issues to improve the Commission's transparency."

2. Background: The CPUC is governed by five full-time commissioners appointed by the Governor and confirmed by the State Senate. Commissioners are appointed for six-year terms and can only be removed by the Legislature. Beginning in 2014, Pacific Gas & Electric began releasing over 65,000 emails from a five-year period. The emails revealed a culture of secrecy within the CPUC. Many of the emails exposed regular private communications between CPUC commissioners and staff with regulated entities on subjects the CPUC was deliberating within a number of proceedings, many of which arguably violated CPUC's rules governing ex parte communications, including emails pertaining to the selection of Administrative Law Judges (ALJs) for ratesetting cases.

3. CPUC Transparency and Oversight: Recently, the CPUC has undergone a number of audits that has raised concerns about the ability of the CPUC to manage even some of its core functions. In response, the CPUC established an Internal Audit Unit, overseen by a chief internal auditor, to perform audits of the CPUC's internal controls and management, oversees its organizational risk assessment and enterprise risk management, and provides consulting services to assist CPUC operations. In addition, current law establishes the Public Advisor's Office, which provides procedural information and advice to individuals and groups who want to participate in formal CPUC proceedings. The office also informs the CPUC of any barriers that prevent effective public participation.

This bill requires the State Auditor to appoint an inspector general to conduct oversight review and assess, audit, investigate, and report on the policies, practices, and procedures of the CPUC, as specified. In addition, the bill tasks the public advisor of the CPUC with the responsibility of ensuring that the activities of the CPUC are transparent to the public, as specified. Furthermore, to promote greater transparency, the bill requires the CPUC to post specified information on its website regarding electricity procurement contracts, pending proceedings, non-confidential documents, Public Records Act requests, and advice letters.

4. Confidentiality: Current law prohibits any information furnished to the CPUC by a public utility, as specified, except those matters specifically required to be open to public inspection, as specified, from being open to public inspection or made public, except on order of the CPUC, or by the CPUC or commissioner in the course of a hearing or proceeding. As a result, regulated utilities argue that there exists a presumption that information is confidential unless a commissioner, on a case-by-case basis, decides it is not.

This bill creates a specified process that provides parties to a proceeding with the ability to contest claims of confidentiality by filing a motion to make the information public, and requires the assigned ALJ or commissioner to make written findings and conclusions.

GOVERNOR'S VETO MESSAGE:

These bills include various provisions to increase transparency and accessibility to the Public Utilities Commission. I support the intent of these bills and many of their proposed reforms, however some additional work is needed to ensure that they achieve their intended purposes and can be effectively implemented.

Allowing Bagley-Keene and Public Records Act lawsuits to be brought against the Commission by any interested party in Superior Court, rather than exclusively in the Courts of Appeal and the California Supreme Court, will only result in increased litigation and likely delay Commission decision-making. It will not improve public access to critical information about the actions of regulated entities. Amending Section 583 of the Public Utilities Code to require more information to be publicly available is a much better way to ensure that the public is provided with this information.

Moreover, the Commission needs sufficient funds to fully accomplish some of these reforms, such as holding more public meetings outside of San Francisco, shortening the timeframe for concluding formal ratesetting and quasi-legislative proceedings and expanding the scope of the information required to be posted on the CPUC's Web site. I am directing the Commission to work with the Legislature through the budget process to ensure the necessary funds are dedicated to accomplish these needed reforms.

Analysis Prepared by: Edmond Cheung / U. & C. / (916) 319-2083 FN: 0002517

CONCURRENCE IN SENATE AMENDMENTS

CSA1 Bill Id:AB 825

Author:(Rendon and Mark Stone)

As Amended Ver:September 4, 2015

Majority vote

Original Committee Reference: U. & C.

SUMMARY: Proposes reforms to governance and operations at the California Public Utilities Commission (CPUC) to increase transparency and oversight over the activities of the CPUC.

The Senate amendments do the following:

1. Clarifies that the Inspector General for the CPUC takes direction from the State Auditor, and provides funding for the Inspector General upon appropriation.

2. Deletes provisions treating certain categories of documents as public.

3. Clarifies the process for allowing parties to challenge confidentiality of documents in CPUC proceedings.

4. Clarifies the role of the CPUC Public Advisor at the CPUC.

5. Establishes "all party conferences" as part of the hearing process for commissioners.

6. Requires public comments at hearings to be incorporated into the hearing's evidentiary records.

7. Requires commissioners to hold public office hours and attend all hearings.

8. Requires the CPUC's public advisor to update and maintain the CPUC's service of process lists.

9. Prohibits a CPUC attorney who prosecutes an action before the CPUC from meeting with a commissioner without all parties present.

10. Deletes prohibition on reassignment of CPUC staff without statutory authority.

11. Deletes requirement that internal CPUC auditors report directly to CPUC.

12. Makes additional technical and clarifying changes.

EXISTING LAW:

1. Establishes the CPUC with five members appointed by the Governor and confirmed by the Senate, empowers it to regulate privately-owned public utilities in California, and specifies that the Legislature may prescribe additional classes of private corporations or other persons as public utilities. (California Constitution Article XII and Public Utilities Code Section 301)

2. Requires the CPUC to provide public copies of the agenda and related items prior to the start of any voting meeting of commissioners, and publish specified documents on the Internet. (Public Utilities Code Section 311.5)

3. Prohibits any information furnished to the CPUC by a public utility, or any business which is a subsidiary or affiliate of a public utility, or a corporation which holds a controlling interest in a public utility, except those matters specifically required to be open to public inspection, as specified, from being open to public inspection or made public, except on order of the CPUC, or by the CPUC or commissioner in the course of a hearing or proceeding. (Public Utilities Code Section 583)

4. Establishes the office of the public advisor, and requires the CPUC to appoint a public advisor in order to assist members of the public and ratepayers who desire to testify before or present information to the CPUC in any hearing or proceeding, and advise the CPUC on procedural matters relating to public participation in proceedings. Provides that the CPUC can employ staff as necessary to carry out the duties of the office of public advisor. (Public Utilities Code Section 321)

5. Requires the CPUC to determine whether a proceeding requires a hearing, and to determine whether the matter requires a quasi-legislative, adjudication, or a ratesetting hearing, and to establish regulations regarding ex parte communication on case categorization issues. (Public Utilities Code Section 1701.1)

FISCAL EFFECT: According to the Senate Appropriations Committee, this bill would have the following costs:

1. Ongoing costs of at least $170,000 and up to $1 million to increase the amount of information available on the CPUC Web site.

2. Ongoing costs of approximately $200,000 for the public advisor to have independent responsibility over the CPUC Web site.

3. Unknown costs to post the transcripts of documents, evidence, testimony, and proceedings online.

4. One-time costs of $157,000 annually for two years for a proceeding to reopen its confidentiality practices.

5. Ongoing costs of $626,000 annually for hearings to consider motions to make confidential documents public.

6. Unknown costs to require that the assigned commissioner attend all hearings in a proceeding.

7. Ongoing costs between $450,000 and $850,000 to appoint an inspector general from the State Auditor's office to the CPUC.

8. Ongoing costs of $220,000 annually to provide legal staff at the public advisor's office to ensure compliance with the Public Records Act and the Bagley-Keene Open Meeting Act. These costs may be offset by reduced workload in other CPUC divisions to oversee compliance.

COMMENTS:

1. Author’s Statement: "Transparency in how government makes its decisions remains a critical link to gaining the public's trust in those decisions. Recent media reports have shown that California Public Utilities Commission decisions lacked transparency, with some deals done in private meetings with investor-owned utility representatives. AB 825 addresses several issues to improve the Commission's transparency."

2. Background: The CPUC is governed by five full-time commissioners appointed by the Governor and confirmed by the State Senate. Commissioners are appointed for six-year terms and can only be removed by the Legislature. Beginning in 2014, Pacific Gas & Electric began releasing over 65,000 emails from a five-year period. The emails revealed a culture of secrecy within the CPUC. Many of the emails exposed regular private communications between CPUC commissioners and staff with regulated entities on subjects the CPUC was deliberating within a number of proceedings, many of which arguably violated CPUC's rules governing ex parte communications, including emails pertaining to the selection of Administrative Law Judges (ALJs) for ratesetting cases.

3. CPUC Transparency and Oversight: Recently, the CPUC has undergone a number of audits that has raised concerns about the ability of the CPUC to manage even some of its core functions. In response, the CPUC established an Internal Audit Unit, overseen by a Chief Internal Auditor, to perform audits of the CPUC's internal controls and management, oversees its organizational risk assessment and enterprise risk management, and provides consulting service to assist CPUC operations. In addition, current law establishes the Public Advisor's Office, which provides procedural information and advice to individuals and groups who want to participate in formal CPUC proceedings. The office also informs the CPUC of any barriers that prevent effective public participation.

This bill requires the State Auditor to appoint an inspector general to conduct oversight review and assess, audit, investigate, and report on the policies, practices, and procedures of the CPUC, as specified. In addition, the bill tasks the public advisor of the CPUC with the responsibility of ensuring that the activities of the CPUC are transparent to the public, as specified. Furthermore, to promote greater transparency, the bill requires the CPUC to post specified information on its website regarding electricity procurement contracts, pending proceedings, non-confidential documents, Public Records Act requests, and advice letters.

4. Confidentiality: Current law prohibits any information furnished to the CPUC by a public utility, as specified, except those matters specifically required to be open to public inspection, as specified, from being open to public inspection or made public, except on order of the CPUC, or by the CPUC or commissioner in the course of a hearing or proceeding. As a result, regulated utilities argue that there exists a presumption that information is confidential unless a commissioner, on a case-by-case basis, decides it is not.

This bill creates a specified process that provides parties to a proceeding with the ability to contest claims of confidentiality by filing a motion to make the information public, and requires the assigned ALJ or commissioner to make written finds and conclusions.

Analysis Prepared by: Edmond Cheung / U. & C. / (916) 319-2083 FN: 0002257

 THIRD READING  

Bill No: AB 825

Author: Rendon (D) and Mark Stone (D)

Amended: 9/4/15 in Senate

Vote: 21

SENATE ENERGY, U. & C. COMMITTEE: 11-0, 7/7/15

AYES: Hueso, Fuller, Cannella, Hertzberg, Hill, Lara, Leyva, McGuire, Morrell, Pavley, Wolk

SENATE APPROPRIATIONS COMMITTEE: 5-0, 8/27/15

AYES: Lara, Beall, Hill, Leyva, Mendoza

NO VOTE RECORDED: Bates, Nielsen

ASSEMBLY FLOOR: 79-0, 6/3/15 - See last page for vote

SUBJECT: Public Utilities Commission

SOURCE: Author

DIGEST: This bill proposes a suite of reforms of the California Public Utilities Commission (CPUC) largely directed at increased transparency of the activities of the agency, including requiring the California State Auditor’s Office to appoint an Inspector General within its office for the CPUC, expanding the roles and responsibilities of the CPUC public advisor, specifying additional requirements of commissioners, and increased transparency of electric utilities’ procurement, among others.

Senate Floor Amendments of 9/4/15 generally include additional requirements for improved transparency and public access of the CPUC, including (1) specifying additional requirements of the agency in making documents publicly accessible and understandable; (2) further clarify the role of the public advisor, including removal of proposed additional responsibilities; (3) provide greater public access of proceedings by specifying the use of all-party meetings at specific points of the proceedings; and (4) require the CPUC to adopt rules for posting comments, proceeding documents, workshop reports and other documents to the agency web site. Other amendments remove portions of the bill including (1) requirements of commissioners to attend all hearings; (2) language in order to avoid chaptering issues with related legislation, including interaction with SB 48 (Hill, 2015).

ANALYSIS:

Existing law:

1. Establishes the CPUC with five members appointed by the Governor and confirmed by the Senate and empowers it to regulate privately-owned public utilities in California. Specifies that the Legislature may prescribe that additional classes of private corporations or other persons are public utilities. (Article XII of the California Constitution; Public Utilities Code §301 et seq.)

2. Requires the CPUC to provide copies and publish the agenda and related items prior to the start of any voting meeting of commissioners. (Public Utilities Code §311.5)

3. Provides that no information furnished to the CPUC by a public utility, or any business which is a subsidiary or affiliate of a public utility, or a corporation which holds a controlling interest in a public utility, except those matters specifically required to be open to public inspection by this part, shall be open to public inspection or made public except on order of the CPUC, or by the CPUC or commissioner in the course of a hearing or proceeding. (Public Utilities Code §583)

4. Establishes the office of the public advisor and requires the CPUC to appoint a public advisor, with a separate office in Los Angeles, in order to assist members of the public and ratepayers who desire to testify before or present information to the CPUC in any hearing or proceeding. (Public Utilities Code §321)

This bill:

1. Requires the California State Auditor to appoint an Inspector General for the purposes of providing oversight of the CPUC at the direction of the State Auditor, including conducting audits, investigations, and reports on the policies, practices, and procedures of the CPUC.

2. Requires each public utility that submits an application to change its rates to include a summary of the application that can be understood by the utility’s ratepayers.

3. Provides that if in a proceeding before the CPUC, a public utility, or subsidiary, affiliate, or holding company, seeks to file a pleading, report, or other document with the CPUC that preserves the confidentiality of information contained therein, it would be required to file a public version of the document that contains sufficient information for any other party to the proceeding to understand the nature of its contents.

4. Authorizes any party to the proceeding to file a motion to make public a pleading, report, or other document filed under a claim of confidentiality. Requires an administrative law judge assigned to the proceeding or the assigned commissioner to hold a hearing on the motion and determine whether the pleading, report, or other document should be made public

5. Requires the public advisor to be responsible for ensuring that the activities of the CPUC are transparent to the public, including (1) working with agency directors to ensure the agency’s Web Site provides sufficient transparency and (2) update, maintain, and post the CPUC’s service-of-process lists on the CPUC’s Internet Web site in an electronic form that may be used by any party to complete service of process.

6. Requires the CPUC to post on its Internet Web site a summary of all electricity procurement contracts entered into by an electrical corporation during the previous three years, with specific requirements, and requires the CPUC to open a proceeding to reexamine a specified decision relative to confidentiality of electric procurement data.

7. Requires the CPUC to use all-party conferences, with required transcripts for the record, as a tool for listening to parties’ perspectives on the most important issues and to facilitate public discussion between commissioners and parties, including at varying points of a proceeding, such as after a proposed decision is issued.

8. Prohibits an attorney or other staff member who has served as a prosecutor or advocate of an adjudicatory proceeding before the CPUC from meeting with any commissioner regarding the matter unless all parties are present.

9. Requires the commission to adopt rules providing for public comments to be included in the record of its proceedings and require the assigned commissioner or a quorum of commissioners to attend public participation proceeding.

10. Includes chaptering language related to SB 48, including provisions applying the Administrative Procedures Act Code of Ethics to Administrative Law Judges and provisions related to the role of the public advisor.

Background

The CPUC quasi-independent, but still accountable to the legislature. The CPUC was established by constitutional amendment as part of the sweep of progressive reforms in the early 1900’s. Article XII of the California Constitution grants the CPUC authority to regulate public utilities "subject to control of the Legislature" and grants the Legislature "plenary power" to confer authority and jurisdiction upon the CPUC, with the intent that the CPUC be accountable to the Legislature.

Fatal explosion in San Bruno. On September 9, 2010, a natural gas pipeline owned by Pacific Gas and Electric Company (PG&E) exploded in residential neighborhood in the City of San Bruno. Eight people died, dozens were injured, 38 houses were destroyed and many more were damaged. The investigations by the National Transportation Safety Board (NTSB) and an independent review panel appointed by the CPUC found that PG&E mismanaged their pipeline over decades, failed to adequately test the strength of the pipeline and, more generally, valued profits over safety. These same investigations also noted the CPUC’s inadequate oversight of PG&E.

Emails demonstrate “Culture of Conversation.” During the summer and fall of 2014, PG&E, bowing to legal pressure from the City of San Bruno, began to release a growing number of emails between the utility and CPUC officials. PG&E released 65,000 emails from over a five-year period that PG&E says it believes “violated CPUC rules governing ex parte communications.” The initial release of emails revealed efforts by PG&E executives to influence the CPUC’s assignment of the administrative law judge to the San Bruno proceeding. Many of the other emails exposed regular, private, familiar communications between PG&E and certain CPUC commissioners, including former CPUC President Michael Peevey and current commissioner Peter Florio, as well as senior CPUC officials.

Criminal investigations opened. Since PG&E’s initial release of the emails, both the state Attorney General and the United States Department of Justice have opened investigations into communications between the CPUC and regulated entities. PG&E has fired three senior executives. A senior CPUC official has resigned, while other top CPUC officials – including longtime CPUC President Michael Peevey and Executive Director Paul Clannon – have retired under pressure. Investigators working with the Attorney General’s Office have raided the CPUC offices and the homes of former CPUC Commissioner President Peevey and PG&E former-Vice President Brian Cherry.

San Onofre Nuclear Generating Stations (SONGS). In early February, after a newspaper published details of the search warrant, Southern California Edison disclosed a meeting that occurred two years prior in Warsaw, Poland between then-CPUC President Peevey and a utility executive in which they discussed how to resolve the shutdown plans for SONGS. The facility had a failed steam generator that required SONGS to be permanently retired. In November 2014, the CPUC approved a settlement agreement between utilities and ratepayer advocates that split the costs of retiring the facility and the associated replacement power, with ratepayers shouldering $3.3 billion of the $4.7 billion total costs. Some parties to the proceeding who were not parties to the agreement, filed multiple lawsuits against the agency and also requested public records related to the deal.

Audits reveal CPUC’s efforts are lacking. In recent years, the CPUC has undergone a number of audits related to its budget, transportation program, natural gas pipeline safety program and others. The findings of these audits have raised concerns about the ability of CPUC to manage even some of its core functions. A March 2014 audit by the State Auditors found that “the CPUC lacks adequate processes for sufficient oversight of utility balancing accounts to protect ratepayers from unfair rate increases.” The NTSB San Bruno investigation report and subsequent audits, have found that CPUC’s oversight of natural gas pipeline safety efforts by the utilities needs improvements.

Internal auditor. In response, the CPUC recently established an Internal Audit Unit, overseen by a Chief Internal Auditor, which performs audits of the CPUC’s internal controls and management, oversees organizational risk assessment and enterprise risk management, and provides consulting services as requested to assist CPUC operations. Internal Audit Unit reports directly to the CPUC, with the Chief functionally reporting to the commissioners through its Finance and Administration Committee, and operates under a charter approved by the CPUC on May 21, 2015.

Role of the public advisor. The Public Advisor's Office provides procedural information and advice to individuals and groups who want to participate in formal CPUC proceedings. Additionally, the Office is required to inform the CPUC of barriers that prevent effective public participation. The Public Advisor’s Office also provides programs and services to educate and assist the public, including special accommodations and interpreter services.

NOTE:   See Senate Energy, Utilities, and Commerce Committee analysis for a full discussion of this bill.

Prior/Related Legislation

SB 48 (Hill, 2015) proposes a suite of reforms of the CPUC, including modifying the role of the president, meeting location requirements, and other reforms. The bill is currently under consideration on the Assembly Floor.

SB 215 (Leno, 2015) proposes a suite of reforms of the CPUC related to governance and operations, including disqualification of commissioners to proceedings, modifying the role of the president, modifying ex parte rules, and other reforms. The bill was held in the Senate Committee on Energy, Utilities and Communications after merging much of its contents with SB 660.

SB 660 (Leno/Hueso, 2015) proposes a suite of reforms of the CPUC focused on ex parte communications rules, addressing the disqualification of commissioners in proceedings, modifying the powers of the president, and others. The bill is currently under consideration on the Assembly Floor.

FISCAL EFFECT: Appropriation: No Fiscal Com.: Yes Local: Yes

According to the Senate Appropriations Committee:

• Cost pressures of $200,000 annually (special*) for the CPUC commissioners to hold office hours at least once a month in San Francisco or Los Angeles.

• Ongoing costs of approximately $170,000 (special*) to increase the amount of information available on the CPUC website.

• Ongoing costs of approximately $200,000 (special*) for the public advisor to have independent responsibility over the CPUC website.

• Unknown costs (special*) to post the transcripts of documents, evidence, testimony, and proceedings online.

• One-time costs of $157,000 annually for two years (special*) for a proceeding to reopen its confidentiality practices.

• Ongoing costs of $626,000 annually (special*) for hearings to consider motions to make confidential documents public.

• Unknown costs (special*) to require that the assigned commissioner attend all hearings in a proceeding.

• Ongoing costs between $450,000 and $850,000 (special*) to appoint an inspector general from the State Auditor’s office to the CPUC.

• Ongoing costs of $220,000 annually (special*) to provide legal staff at the public advisor’s office to ensure compliance with the Public Records Act and the Bagley-Keene Open Meeting Act. These costs may be offset by reduced workload in other CPUC division to oversee compliance.

* Public Utilities Commission Utilities Reimbursement Account.

SUPPORT: (Verified 9/8/15)

California Newspaper Publishers Association

California Teamsters Public Affairs Council

County of San Diego 2^nd Supervisorial District, Dianne Jacob

County of San Joaquin

Engineers & Scientists of California

IFPTE Local 20 AFL-CIO

Sierra Club California

Utility Workers Union of America, AFL-CIO

OPPOSITION: (Verified 9/8/15)

None received

ARGUMENTS IN SUPPORT: Recent media reports have revealed a lack of transparency in decisions by the CPUC. Transparency in how public agencies make decisions remains a longstanding and fundamental principle in California law and government. AB 825 increases CPUC transparency in three ways: (1) requires disclosure of information on the web and requires other CPUC actions to help Californians participate in the CPUC process; (2) provides a process for challenging confidentiality of documents; and (3) provides for independent oversight, by an Inspector General in the State Auditor’s office.

ASSEMBLY FLOOR: 79-0, 6/3/15

AYES: Achadjian, Alejo, Travis Allen, Baker, Bigelow, Bloom, Bonilla, Bonta, Brough, Brown, Burke, Calderon, Campos, Chang, Chau, Chávez, Chiu, Chu, Cooley, Cooper, Dababneh, Dahle, Daly, Dodd, Eggman, Frazier, Beth Gaines, Gallagher, Cristina Garcia, Eduardo Garcia, Gatto, Gipson, Gomez, Gonzalez, Gordon, Gray, Grove, Hadley, Harper, Roger Hernández, Holden, Irwin, Jones, Jones-Sawyer, Kim, Lackey, Levine, Linder, Lopez, Low, Maienschein, Mathis, Mayes, McCarty, Medina, Melendez, Mullin, Nazarian, Obernolte, O'Donnell, Olsen, Patterson, Perea, Quirk, Rendon, Ridley-Thomas, Rodriguez, Salas, Santiago, Steinorth, Mark Stone, Ting, Wagner, Waldron, Weber, Wilk, Williams, Wood, Atkins

NO VOTE RECORDED: Thurmond

Prepared by: Nidia Bautista / E., U., & C. / (916) 651-4107

9/8/15 18:56:35

**** END ****

 THIRD READING  

Bill No: AB 825

Author: Rendon (D) and Mark Stone (D)

Amended: 9/1/15 in Senate

Vote: 21

SENATE ENERGY, U. & C. COMMITTEE: 11-0, 7/7/15

AYES: Hueso, Fuller, Cannella, Hertzberg, Hill, Lara, Leyva, McGuire, Morrell, Pavley, Wolk

SENATE APPROPRIATIONS COMMITTEE: 5-0, 8/27/15

AYES: Lara, Beall, Hill, Leyva, Mendoza

NO VOTE RECORDED: Bates, Nielsen

ASSEMBLY FLOOR: 79-0, 6/3/15 - See last page for vote

SUBJECT: Public Utilities Commission

SOURCE: Author

DIGEST: This bill proposes a suite of reforms of the California Public Utilities Commission (CPUC) largely directed at increased transparency of the activities of the agency, including requiring the California State Auditor’s Office to appoint an Inspector General within its office for the CPUC, expanding the roles and responsibilities of the CPUC public advisor, specifying additional requirements of commissioners, increased transparency of electric utilities’ procurement, among others.

ANALYSIS:

Existing law:

1. Establishes the CPUC with five members appointed by the Governor and confirmed by the Senate and empowers it to regulate privately-owned public utilities in California. Specifies that the Legislature may prescribe that additional classes of private corporations or other persons are public utilities. (Article XII of the California Constitution; Public Utilities Code §301 et seq.)

2. Requires the CPUC to provide copies and publish the agenda and related items prior to the start of any voting meeting of commissioners. (Public Utilities Code §311.5)

3. Provides that no information furnished to the CPUC by a public utility, or any business which is a subsidiary or affiliate of a public utility, or a corporation which holds a controlling interest in a public utility, except those matters specifically required to be open to public inspection by this part, shall be open to public inspection or made public except on order of the CPUC, or by the CPUC or commissioner in the course of a hearing or proceeding. (Public Utilities Code §583)

4. Establishes the office of the public advisor and requires the CPUC to appoint a public advisor, with a separate office in Los Angeles, in order to assist members of the public and ratepayers who desire to testify before or present information to the CPUC in any hearing or proceeding. Provides that the CPUC can employ staff as necessary to carry out the duties of the office of public advisor. (Public Utilities Code §321)

5. Requires the CPUC to determine whether a proceeding requires a hearing and whether it is quasi-legislative, adjudication or ratesetting. Provides rules governing each type of proceeding, including prohibiting any substantive communication between a decision maker and a party in adjudicative cases. (Public Utilities Code §§1701.1 and 1701.2)

This bill:

1. Requires the California State Auditor to appoint an Inspector General for the purposes of providing oversight of the CPUC at the direction of the State Auditor, including conducting audits, investigations, and reports on the policies, practices, and procedures of the CPUC.

2. Requires each public utility that submits an application to change its rates to include in its application a summary of the application that can be understood by the utility’s ratepayers. Requires that this summary and the application be posted on the CPUC’s Internet Web site and, if the utility has an Internet Web site, to be posted on the utility’s Internet Web site.

3. Provides that if in a proceeding before the CPUC, a public utility, or subsidiary, affiliate, or holding company, seeks to file a pleading, report, or other document with the CPUC that preserves the confidentiality of information contained therein, it would be required to file a public version of the pleading, report, or other document that contains sufficient information for any other party to the proceeding to understand the nature of its contents.

4. Authorizes any party to the proceeding to file a motion to make public a pleading, report, or other document filed under a claim of confidentiality. Requires an administrative law judge assigned to the proceeding or the assigned commissioner to hold a hearing on the motion and determine whether the pleading, report, or other document should be made public

5. Adds legislative findings and declarations relative to improving the transparency of CPUC regulatory activities.

6. Requires the public advisor to be responsible for ensuring that the activities of the CPUC are transparent to the public consistent with these legislative findings and directions, the California Public Records Act, the Bagley-Keene Open Meeting Act, and other specified matter.

7. Requires the public advisor to have independent responsibility for overseeing the CPUC’s Internet Web site and would require the CPUC to post on its Internet Web site a summary of all electricity procurement contracts entered into by an electrical corporation during the previous three years, with specific requirements.

8. Requires the public advisor to update, maintain, and post the CPUC’s service-of-process lists on the CPUC’s Internet Web site in an electronic form that may be used by any party to complete service of process.

9. Requires the CPUC to open a proceeding to reexamine a specified decision relative to confidentiality of electric procurement data.

10. Requires the assigned commissioner to a proceeding to convene an all-parties meeting as soon as practicable after the parties in a proceeding are known to discuss the substantive matter to be decided in the proceeding and prospects for resolving issues that would otherwise be litigated.

11. Requires an assigned commissioner to attend all hearings in a proceeding.

12. Prohibits an attorney that is prosecuting a matter before the CPUC from meeting with any commissioner regarding the matter that the attorney is prosecuting unless all parties are present.

Background

The CPUC quasi-independent, but still accountable to the legislature. The CPUC was established by constitutional amendment as part of the sweep of progressive reforms in the early 1900’s. Article XII of the California Constitution grants the CPUC authority to regulate public utilities "subject to control of the Legislature" and grants the Legislature "plenary power" to confer authority and jurisdiction upon the CPUC, with the intent that the CPUC be accountable to the Legislature.

Fatal explosion in San Bruno. On September 9, 2010, a natural gas pipeline owned by Pacific Gas and Electric Company (PG&E) exploded in residential neighborhood in the City of San Bruno. Eight people died, dozens were injured, 38 houses were destroyed and many more were damaged. The investigations by the National Transportation Safety Board (NTSB) and an independent review panel appointed by the CPUC found that PG&E mismanaged their pipeline over decades, failed to adequately test the strength of the pipeline and, more generally, valued profits over safety. These same investigations also noted the CPUC’s inadequate oversight of PG&E.

Emails demonstrate “Culture of Conversation.” During the summer and fall of 2014, PG&E, bowing to legal pressure from the City of San Bruno, began to release a growing number of emails between the utility and CPUC officials. PG&E released 65,000 emails from over a five-year period that PG&E says it believes “violated CPUC rules governing ex parte communications.” The initial release of emails revealed efforts by PG&E executives to influence the CPUC’s assignment of the administrative law judge to the San Bruno proceeding. Many of the other emails exposed regular, private, familiar communications between PG&E and certain CPUC commissioners, including former CPUC President Michael Peevey and current commissioner Peter Florio, as well as senior CPUC officials.

Criminal investigations opened. Since PG&E’s initial release of the emails, both the state Attorney General and the United States Department of Justice have opened investigations into communications between the CPUC and regulated entities. PG&E has fired three senior executives. A senior CPUC official has resigned, while other top CPUC officials – including longtime CPUC President Michael Peevey and Executive Director Paul Clannon – have retired under pressure. Investigators working with the Attorney General’s Office have raided the CPUC offices and the homes of former CPUC Commissioner President Peevey and PG&E former-Vice President Brian Cherry.

San Onofre Nuclear Generating Stations (SONGS). In early February, after a newspaper published details of the search warrant, Southern California Edison disclosed a meeting that occurred two years prior in Warsaw, Poland between then-CPUC President Peevey and a utility executive in which they discussed how to resolve the shutdown plans for SONGS. The facility had a failed steam generator that required SONGS to be permanently retired. In November 2014, the CPUC approved a settlement agreement between utilities and ratepayer advocates that split the costs of retiring the facility and the associated replacement power, with ratepayers shouldering $3.3 billion of the $4.7 billion total costs. Some parties to the proceeding who were not parties to the agreement, filed multiple lawsuits against the agency and also requested public records related to the deal.

Audits reveal CPUC’s efforts are lacking. In recent years, the CPUC has undergone a number of audits related to its budget, transportation program, natural gas pipeline safety program and others. The findings of these audits have raised concerns about the ability of CPUC to manage even some of its core functions. A March 2014 audit by the State Auditors found that “the CPUC lacks adequate processes for sufficient oversight of utility balancing accounts to protect ratepayers from unfair rate increases.” The NTSB San Bruno investigation report and subsequent audits, have found that CPUC’s oversight of natural gas pipeline safety efforts by the utilities needs improvements.

Internal auditor. In response, the CPUC recently established an Internal Audit Unit, overseen by a Chief Internal Auditor, which performs audits of the CPUC’s internal controls and management, oversees organizational risk assessment and enterprise risk management, and provides consulting services as requested to assist CPUC operations. Internal Audit Unit reports directly to the CPUC, with the Chief functionally reporting to the commissioners through its Finance and Administration Committee, and operates under a charter approved by the CPUC on May 21, 2015.

Role of the public advisor. The Public Advisor's Office provides procedural information and advice to individuals and groups who want to participate in formal CPUC proceedings. Additionally, the Office is required to inform the CPUC of barriers that prevent effective public participation. The Public Advisor’s Office also provides programs and services to educate and assist the public, including special accommodations and interpreter services.

NOTE:   See Senate Energy, Utilities, and Commerce Committee analysis for a full discussion of this bill.

Prior/Related Legislation

SB 48 (Hill, 2015) proposes a suite of reforms of the CPUC, including modifying the role of the president, meeting location requirements, and other reforms. The bill is currently under consideration on the Assembly Floor.

SB 215 (Leno, 2015) proposes a suite of reforms of the CPUC related to governance and operations, including disqualification of commissioners to proceedings, modifying the role of the president, modifying ex parte rules, and other reforms. The bill was held in the Senate Committee on Energy, Utilities and Communications after merging much of its contents with SB 660.

SB 660 (Leno/Hueso, 2015) proposes a suite of reforms of the CPUC focused on ex parte communications rules, addressing the disqualification of commissioners in proceedings, modifying the powers of the president, and others. The bill is currently under consideration on the Assembly Floor.

FISCAL EFFECT: Appropriation: No Fiscal Com.: Yes Local: Yes

According to the Senate Appropriations Committee:

• Cost pressures of $200,000 annually (special*) for the CPUC commissioners to hold office hours at least once a month in San Francisco or Los Angeles.

• Ongoing costs of approximately $170,000 (special*) to increase the amount of information available on the CPUC website.

• Ongoing costs of approximately $200,000 (special*) for the public advisor to have independent responsibility over the CPUC website.

• Unknown costs (special*) to post the transcripts of documents, evidence, testimony, and proceedings online.

• One-time costs of $157,000 annually for two years (special*) for a proceeding to reopen its confidentiality practices.

• Ongoing costs of $626,000 annually (special*) for hearings to consider motions to make confidential documents public.

• Unknown costs (special*) to require that the assigned commissioner attend all hearings in a proceeding.

• Ongoing costs between $450,000 and $850,000 (special*) to appoint an inspector general from the State Auditor’s office to the CPUC.

• Ongoing costs of $220,000 annually (special*) to provide legal staff at the public advisor’s office to ensure compliance with the Public Records Act and the Bagley-Keene Open Meeting Act. These costs may be offset by reduced workload in other CPUC division to oversee compliance.

* Public Utilities Commission Utilities Reimbursement Account.

SUPPORT: (Verified 8/28/15)

California Newspaper Publishers Association

California Teamsters Public Affairs Council

County of San Diego 2^nd Supervisorial District, Dianne Jacob

County of San Joaquin

Engineers & Scientists of California

IFPTE Local 20 AFL-CIO

Sierra Club California

Utility Workers Union of America, AFL-CIO

OPPOSITION: (Verified 8/28/15)

None received

ARGUMENTS IN SUPPORT: Recent media reports have revealed a lack of transparency in decisions by the CPUC. Transparency in how public agencies make decisions remains a longstanding and fundamental principle in California law and government. AB 825 increases CPUC transparency in three ways: (1) requires disclosure of information on the web and requires other CPUC actions to help Californians participate in the CPUC process; (2) provides a process for challenging confidentiality of documents; and (3) provides for independent oversight, by an Inspector General in the State Auditor’s office.

ASSEMBLY FLOOR: 79-0, 6/3/15

AYES: Achadjian, Alejo, Travis Allen, Baker, Bigelow, Bloom, Bonilla, Bonta, Brough, Brown, Burke, Calderon, Campos, Chang, Chau, Chávez, Chiu, Chu, Cooley, Cooper, Dababneh, Dahle, Daly, Dodd, Eggman, Frazier, Beth Gaines, Gallagher, Cristina Garcia, Eduardo Garcia, Gatto, Gipson, Gomez, Gonzalez, Gordon, Gray, Grove, Hadley, Harper, Roger Hernández, Holden, Irwin, Jones, Jones-Sawyer, Kim, Lackey, Levine, Linder, Lopez, Low, Maienschein, Mathis, Mayes, McCarty, Medina, Melendez, Mullin, Nazarian, Obernolte, O'Donnell, Olsen, Patterson, Perea, Quirk, Rendon, Ridley-Thomas, Rodriguez, Salas, Santiago, Steinorth, Mark Stone, Ting, Wagner, Waldron, Weber, Wilk, Williams, Wood, Atkins

NO VOTE RECORDED: Thurmond

Prepared by: Nidia Bautista / E., U., & C. / (916) 651-4107

9/1/15 21:51:40

**** END ****

SENATE COMMITTEE ON APPROPRIATIONS

Senator Ricardo Lara, Chair

2015 - 2016 Regular Session

AB 825 (Rendon) - Public Utilities Commission.

*********** ANALYSIS ADDENDUM – SUSPENSE FILE ***********

The following information is revised to reflect amendments

adopted by the committee on August 27, 2015

Bill Summary:

AB 825 would make a number of changes to the CPUC to increase public access to documents and to ease participation in proceedings.

Fiscal Impact:

• Ongoing costs of at least $170,000 and up to $1 million (special*) to increase the amount of information available on the CPUC website.

• Ongoing costs of approximately $200,000 (special*) for the public advisor to have independent responsibility over the CPUC website.

• Unknown costs (special*) to post the transcripts of documents, evidence, testimony, and proceedings online.

• One-time costs of $157,000 annually for two years (special*) for a proceeding to reopen its confidentiality practices.

• Ongoing costs of $626,000 annually (special*) for hearings to consider motions to make confidential documents public.

• Unknown costs (special*) to require that the assigned commissioner attend all hearings in a proceeding.

• Ongoing costs between $450,000 and $850,000 (special*) to appoint an inspector general from the State Auditor’s office to the CPUC.

• Ongoing costs of $220,000 annually (special*) to provide legal staff at the public advisor’s office to ensure compliance with the Public Records Act and the Bagley-Keene Open Meeting Act. These costs may be offset by reduced workload in other CPUC division to oversee compliance.

* Public Utilities Commission Utilities Reimbursement Account.

Author Amendments:

Delete the requirement for each commissioner to hold monthly public office hours and to specify requirements of the inspector general.

Committee Amendments:

Delete §722(b) from the bill to make clear there are no changes to the existing way the Office of the Public Advisor is funded and specify that the inspector general shall recover its costs from the reimbursement fees paid to the CPUC upon appropriation of the Legislature.

-- END --

SENATE COMMITTEE ON APPROPRIATIONS

Senator Ricardo Lara, Chair

2015 - 2016 Regular Session

AB 825 (Rendon) - Public Utilities Commission.

This bill meets the criteria for referral to the Suspense File.

Bill Summary:

AB 825 would make a number of changes to the CPUC to increase public access to documents and to ease participation in proceedings.

Fiscal Impact:

• Cost pressures of $200,000 annually (special*) for the CPUC commissioners to hold office hours at least once a month in San Francisco or Los Angeles.

• Ongoing costs of approximately $170,000 (special*) to increase the amount of information available on the CPUC website.

• Ongoing costs of approximately $200,000 (special*) for the public advisor to have independent responsibility over the CPUC website.

• Unknown costs (special*) to post the transcripts of documents, evidence, testimony, and proceedings online.

• One-time costs of $157,000 annually for two years (special*) for a proceeding to reopen its confidentiality practices.

• Ongoing costs of $626,000 annually (special*) for hearings to consider motions to make confidential documents public.

• Unknown costs (special*) to require that the assigned commissioner attend all hearings in a proceeding.

• Ongoing costs between $450,000 and $850,000 (special*) to appoint an inspector general from the State Auditor’s office to the CPUC.

• Ongoing costs of $220,000 annually (special*) to provide legal staff at the public advisor’s office to ensure compliance with the Public Records Act and the Bagley-Keene Open Meeting Act. These costs may be offset by reduced workload in other CPUC division to oversee compliance.

* Public Utilities Commission Utilities Reimbursement Account.

Background:

The CPUC is governed by five members appointed by the Governor and approved by the Senate Rules Committee. The CPUC is generally empowered to regulate privately owned public utilities in California. Policies and actions of the CPUC are generally made through a proceeding. Each proceeding is assigned a lead commissioner and an administrative law judge (ALJ). ALJs prepare proposed decisions which may be adopted in whole or in part by the commission.

Existing law requires the CPUC to hold at least one meeting per month in San Francisco. Any information furnished to the CPUC by a public utility is not open to public inspection except on order of the CPUC in the course of a hearing or proceeding.

Existing law establishes the office of the public advisor, appointed by the CPUC, in order to assist the public and ratepayers who desire to testify before or present information to the CPUC in any hearing or proceeding.

Proposed Law:

This bill would:

• Require each commissioner to hold office hours and be available to meet with members of the public at least once a month in San Francisco or Los Angeles

• Require that the CPUC have the following information on its website:

  • A summary of electricity procurement contracts entered into by an electrical corporation during the previous three years which have expenses that the CPUC has approved as just and reasonable.

  • A list of all pending proceedings involving public utilities and whether any rate increase is being sought.

  • Transcriptions and available summaries of documents not subject to confidentiality.

  • A list of all Public Records Act requests

  • Advice letters approved by the CPUC.

  • Reports of inspections and audits.

• Require a utility to place on its own website, if they have one, a summary of all rate application requests including the contact information for an utility official who can discuss the nature of the rate application.

• Require that all documents that the CPUC distributes to any service-of-process list be docketed and identified on the CPUC website.

• Require that all rate applications by public utilities include a summary of the application that can be understood by the utility’s ratepayers.

• For any document filed in a CPUC proceeding by a public utility under a claim of confidentiality, (1) require that a public version of that document be filed concurrently, (2) allow any party to that proceeding to file a motion to make public that document, (3) require the assigned ALJ to provide direction to all parties in a proceeding as to what documents may be filed under a claim of confidentiality.

• Require the CPUC to open a proceeding to reexamine its confidentiality practices under Decision 06-06-066.

• Require the public advisor of the CPUC to be specifically responsible for:

  • Ensuring that the activities of the CPUC are transparent to the public.

  • Developing and making available public guides on how to participate in CPUC proceedings.

  • Updating, maintaining, and posting the CPUC’s service-of-process lists on its website.

  • Overseeing the CPUC’s website to ensure adequate transparency for he public

• Require that the office of the public advisor be funded by the Public Utilities Reimbursement Account, which is funded by fees on the regulated utilities.

• Require the California State Auditor appoint an inspector general for the CPUC who will report any findings to the Legislature. The inspector general would have the authority to audit and investigate the CPUC’s activities. The costs for the inspector’s activities would be paid for by the Public Utilities Reimbursement Account

• Require that the assigned commissioner for a proceeding convene an all-parties meeting as soon as practicable to discuss the substantive manner to be decided in the proceeding and prospects for resolving issues that would otherwise be litigated.

• Require that the assigned commissioner attend all hearings in a proceeding.

• Prohibit an attorney that is prosecuting a manner before the CPUC in an adjudication hearing from meeting with any commissioner regarding the matter unless all parties are present.

Related Legislation:

SB 48 (Hill) would make various changes to the internal governance, annual reporting requirements, and meeting requirements of the CPUC. SB 48 has been referred to the Assembly Committee on Appropriations.

SB 660 (Leno/Hueso) would make changes to the ex parte communications at the CPUC. SB 660 has been referred to the Assembly Committee on Appropriations.

Staff Comments:

Public office hours requirement: The CPUC estimates that the requirement for each commissioner to hold office hours at least once a month in San Francisco or Los Angeles will require additional staff, particularly to ensure compliance with ex parte rules and to provide the commissioner with legal support and analytical staff to address constituent concerns, at an annual cost of $200,000. However, staff notes that this provision is not increasing the commissioners’ responsibilities other than making them more accessible. While this accessibility may lead to additional work and inquires, that workload would be associated with existing responsibilities of the commissioners. As such, these costs could be interpreted as cost pressures.

Requirements for information to be posted on the CPUC website: This bill would require a number of items to be placed on the CPUC’s website. While some of this information, such as advice letters approved by the CPUC and reports of inspections and audits, can be done with minimal staff workload and costs. However, the requirement that summaries of electricity procurement contracts and transcripts will likely result in the need for an additional $170,000 annually for one position. Staff notes that the CPUC does not currently receive information from the IOUs regarding procurement contracts, with the exception of Renewable Energy Portfolio Standards contacts. Thus the requirement that procurement contracts be posted on the website will involve the collection and summarization of a large amount of new information.

Staff notes that the bill requires that a list of all pending proceedings before the CPUC be posted on its website along with a summary as to any amount of rate increase being sought. Since December 2014, a list of pending proceedings has been posted on the CPUC website and has been updated monthly. Should there be pressure for the CPUC to update this list more frequently, there could be additional IT costs.

The requirement for the posting of transcripts and available summaries of documents, evidence, testimony, and proceedings could have additional unknown costs because the court reporter bargaining agreement requires a per-transcript charge. It is unclear how the per-transcript charges would be assessed if the transcripts were made available on-line. Staff notes that allowing webcasting and video archives of hearings to be available instead of a transcript might lower costs.

Confidentiality practices and procedures: This bill would also require the CPUC to reopen its existing decision (D. 06-06-066) on its confidentiality practices. The CPUC estimates that this requirement would necessitate an administrative law judge for two years at an annual cost of $157,000 annually.

Section 6 of this bill would establish a process for the filing and contesting of confidential documents. The costs associated with this section are mostly associated with the required hearings with written findings and conclusions when there is a motion to make a document public. In 2014, there were 175 motions on confidentiality matters. The CPUC anticipates that the number of motions would increase with the passage of this bill. The cost of holding these hearings as required by the bill is estimated to be $626,000 annually for 4.5 positions.

The CPUC notes that the bill’s requirement that the assigned commissioner attend all hearings in a proceeding is likely to be very difficult and extremely costly to comply and may result in the slowing of proceedings. In 2014, there were 99 new proceedings plus 30 re-opened proceedings, of which 59 had hearings. There are five CPUC commissioners. However, the CPUC did not submit specific costs to these provisions.

Inspector general costs: The costs associated with appointing an inspector general to the CPUC would have uncertain costs depending on the number of audits and investigations that would be conducted. Assuming that there would be one to three audits or investigations a year, this provision will result in $450,000 to $850,000 in additional costs to the CPUC. Staff notes that the CPUC received appropriations in the 2015-16 Budget Act for a number of auditors. However, those positions would not fulfill the bill’s requirement for an inspector general.

Increased responsibilities of the public advisor: The public advisor would have increased responsibilities under this bill. Specifically, the requirement that the public advisor have the responsibility for ensuring that the activities of the CPUC are in compliance with the Public Records Act and Bagley-Keene Open Meeting Act would necessitate legal staff and support in the public advisor’s office, which does not currently exist, at a cost of about $220,000 annually. Staff notes that the CPUC already has staff overseeing compliance with Bagley-Keene and the Public Records Act. To the extent that the bill shifts these responsibilities to the public advisor’s office, there potentially should be a decrease in staffing costs in other CPUC divisions.

This bill would also require the public advisor to have independent responsibility for overseeing the CPUC website in order to ensure adequate transparency. The CPUC estimates that this responsibility could necessitate two new positions in the public advisors office at an annual cost of approximately $200,000. Similar to the legal staff for the office discussed above, these costs may be somewhat duplicative of staffing workload already within the CPUC. Because the bill requires that the public advisor’s office have independent responsibility over the website, duplicative costs may be inherently required by the bill.

The requirement for the public advisor to update, maintain, and post the service-of-process lists on the website could potentially have costs depending on how this requirement is interpreted. If this requirement can be satisfied by just posting the list itself on the website, there will be no costs to the CPUC as this list is already compiled by the CPUC’s Docket Office. However, if this requirement is interpreted to require the public advisor to actually electronically serve documents to the service-of-process list, the CPUC could have millions of dollars of new costs to develop necessary IT systems.

This bill would require that the Office of the Public Advisor’s costs be paid for by the Public Utilities Commission Utilities Reimbursement Account. Currently the office is paid for by this account, but as distributed administration costs so that the other CPUC funds pay a pro rata share of the office by reimbursing the account. It is unclear if the bill would affect the current practice. Unless it is the author’s intent that the Office of the Public Advisor only be paid for by the Utilities Reimbursement Account, staff recommends that this provision be stricken from the bill.

This bill contains codified findings and declarations. In the interest of code clarity and efficiency, staff recommends this bill be amended to place the findings and declarations in an uncodified section of the bill.

This bill constitutes a state mandate as it creates a new crime. However, under the California Constitution, costs associated with this mandate are not reimbursable.

-- END --

SENATE COMMITTEE ON ENERGY, UTILITIES AND COMMUNICATIONS

Senator Ben Hueso, Chair

2015 - 2016 Regular

Bill No: AB 825 Hearing Date: 7/7/2015

SUBJECT: Public Utilities Commission

DIGEST: This bill proposes a suite of reforms of the California Public Utilities Commission (CPUC) largely directed at increased transparency of the activities of the agency, including expanding the roles and responsibilities of the public advisor, specifying additional requirements of commissioners, increased transparency of electric utilities’ procurement, among others.

ANALYSIS:

Existing law:

1. Establishes the CPUC with five members appointed by the Governor and confirmed by the Senate and empowers it to regulate privately-owned public utilities in California. Specifies that the Legislature may prescribe that additional classes of private corporations or other persons are public utilities. (Article XII of the California Constitution; Public Utilities Code §301 et seq.)

2. Requires the CPUC to hold at least one hearing per calendar month in the City and County of San Francisco. (Public Utilities Code §306)

3. Provides that the executive director may employ such officers, administrative law judges, experts, engineers, employees and others, as the executive director deems necessary to carry out and exercise powers conferred upon the CPUC by law. (Public Utilities Code §309)

4. Provides commissioners may request one adviser for each member to be appointed by the Governor and limits the total advisers exempt from civil service to five. (Public Utilities Code §309.1)

5. Requires the CPUC to provide copies and publish the agenda and related items prior to the start of any voting meeting of commissioners. (Public Utilities Code §311.5)

6. Requires the CPUC to provide any reports of inspections and audits of utilities to the Board of Equalization. (Public Utilities Code §314.5)

7. Provides that no information furnished to the CPUC by a public utility, or any business which is a subsidiary or affiliate of a public utility, or a corporation which holds a controlling interest in a public utility, except those matters specifically required to be open to public inspection by this part, shall be open to public inspection or made public except on order of the CPUC, or by the CPUC or commissioner in the course of a hearing or proceeding. (Public Utilities Code §583)

8. Establishes the office of the public advisor and requires the CPUC to appoint a public advisor, with a separate office in Los Angeles, in order to assist members of the public and ratepayers who desire to testify before or present information to the CPUC in any hearing or proceeding. Provides that the CPUC can employ staff as necessary to carry out the duties of the office of public advisor. (Public Utilities Code §321)

9. Authorizes the CPUC to appoint a general counsel to represent the CPUC in all actions, to commence, prosecute or intervene in proceedings as directed by the president, and to advise the CPUC and each commissioner on all matters. (Public Utilities Code §307)

10. Requires the CPUC to determine whether a proceeding requires a hearing and whether it is quasi-legislative, adjudication or ratesetting. Provides rules governing each type of proceeding, including prohibiting any substantive communication between a decision maker and a party f in adjudicative cases. (Public Utilities Code §§1701.1 and 1701.2)

This bill:

1. Prohibits the CPUC from reassigning any staff member from a duty or activity authorized by statute to another duty or activity unless the Legislature has authorized personnel for that duty or activity.

2. Requires the CPUC’s internal auditor to report directly to the CPUC.

3. Requires that each commissioner hold office hours and be available to meet with members of the public at least once a month in San Francisco or Los Angeles.

4. Deletes the requirement that the reports of the inspections and audit of utilities and other pertinent information be furnished to the State Board of Equalization for use in the assessment of the public utilities, and instead requires that the inspections and audit and other pertinent information be posted on the CPUC’s Internet Web site.

5. Requires each public utility that submits an application to change its rates to include in its application a summary of the application that can be understood by the utility’s ratepayers. Requires that this summary and the application be posted on the CPUC’s Internet Web site and, if the utility has an Internet Web site, to be posted on the utility’s Internet Web site. Each public utility that maintains an Internet Web site would additionally be required to include on that site contact information for a utility official who can discuss the nature of the rate application.

6. Provides that if in a proceeding before the CPUC, a public utility, or subsidiary, affiliate, or holding company, seeks to file a pleading, report, or other document with the CPUC that preserves the confidentiality of information contained therein, it would be required to file a public version of the pleading, report, or other document that contains sufficient information for any other party to the proceeding to understand the nature of its contents.

7. Authorizes any party to the proceeding to file a motion to make public a pleading, report, or other document filed under a claim of confidentiality. Requires an administrative law judge assigned to the proceeding or the assigned commissioner to hold a hearing on the motion and determine whether the pleading, report, or other document should be made public

8. Requires that each document that the CPUC distributes to any service-of-process list be docketed and identified on the CPUC’s Internet Web site.

9. Requires that the CPUC provide an opportunity for members of the public to comment on a specific agenda item during the time that the CPUC considers the item.

10. Adds legislative findings and declarations relative to improving the transparency of CPUC regulatory activities.

11. Requires the public advisor to be responsible for ensuring that the activities of the CPUC are transparent to the public consistent with these legislative findings and directions, the California Public Records Act, the Bagley-Keene Open Meeting Act, and other specified matter.

12. Requires the public advisor to have independent responsibility for overseeing the CPUC’s Internet Web site and would require the CPUC to post on its Internet Web site a summary, as specified, of all electricity procurement contracts entered into by an electrical corporation during the previous three years, with specific requirements.

13. Requires the public advisor to update, maintain, and post the CPUC’s service-of-process lists on the CPUC’s Internet Web site in an electronic form that may be used by any party to complete service of process.

14. Requires the CPUC to open a proceeding to reexamine a specified decision relative to confidentiality of electric procurement data.

15. Requires the California State Auditor to appoint an inspector general who would be authorized to audit and investigate the CPUC’s activities and report any finding to the Legislature.

16. Requires the assigned commissioner to convene an all-parties meeting as soon as practicable after the parties in a proceeding are known to discuss the substantive matter to be decided in the proceeding and prospects for resolving issues that would otherwise be litigated.

17. Requires an assigned commissioner to attend all hearings in a proceeding.

18. Prohibits an attorney that is prosecuting a matter before the CPUC from meeting with any commissioner regarding the matter that the attorney is prosecuting unless all parties are present.

Background

The CPUC quasi-independent, but still accountable to the legislature. The CPUC was established by constitutional amendment as part of the sweep of progressive reforms in the early 1900’s. Then-Governor Hiram Johnson pushed for reforms of the Railroad Commission, which became today’s CPUC, as a largely independent agency that would guard against the corrupting influence of railroads. In demonstration of its independence, the CPUC was located in San Francisco, a distance from the state capitol in Sacramento. Article XII of the California Constitution grants the CPUC authority to regulate public utilities "subject to control of the Legislature" and grants the Legislature "plenary power" to confer authority and jurisdiction upon the CPUC, with the intent that the CPUC be accountable to the Legislature.

The CPUC has historically been afforded much independence. Commissioners are appointed for staggered six-year terms to limit the potential for a single Governor to appoint a majority of commissioners within a four-year term. The Legislature, not the Governor, may remove a commissioner. The CPUC has been given broad latitude to set its own procedures, and any review of CPUC decisions has historically been limited to review only by courts of appeal and the Supreme Court, not trial courts.

CPUC in 2015. The CPUC is governed by five full-time commissioners, appointed by the governor and confirmed by the Senate, and staffed by approximately 1,000 individuals who, together, regulate privately owned electric, natural gas, telecommunications, water, railroad, rail transit, and passenger transportation companies. CPUC staff includes four personal advisors to each commissioner, except five to the president, as well as the 42 judges of the Administrative Law Division – attorneys, engineers and accountants who prepare the docket for all CPUC official filings, including maintenance of the official record of proceedings.

Fatal explosion in San Bruno. On September 9, 2010, a natural gas pipeline owned by Pacific Gas and Electric Company (PG&E) exploded in residential neighborhood in the City of San Bruno. Eight people died, dozens were injured, 38 houses were destroyed and many more were damaged. The investigations by the National Transportation Safety Board (NTSB) and an independent review panel appointed by the CPUC found that PG&E mismanaged their pipeline over decades, failed to adequately test the strength of the pipeline and, more generally, valued profits over safety. These same investigations also noted the CPUC’s inadequate oversight of the PG&E.

Following the investigation, in May of 2013, the Safety and Enforcement Division (SED) of the CPUC formally recommended the CPUC to levy fines of $2.25 billion against PG&E, the full amount of which to be used to enhance safety. The CPUC referred the SED’s proposed penalty against PG&E to the Administrative Law Division for assignment to an administrative law judge (ALJ). The ALJ was to review the recommendation and, eventually, propose a final decision on the matter, including how any fines would be allocated among PG&E’s shareholders and ratepayers. Eventually, the five commissioners of the CPUC would vote on whether to adopt, modify, or reject the ALJ’s proposed decision.

Emails demonstrate “Culture of Conversation.” During the summer and fall of 2014, PG&E, bowing to legal pressure from the City of San Bruno, began to release a growing number of emails between the utility and CPUC officials. PG&E released 65,000 emails from over a five year period that PG&E says it believes “violated California Public Utilities Commission rules governing ex parte communications.” The initial release of emails revealed efforts by PG&E executives to influence the CPUC’s assignment of ALJ to the San Bruno proceeding. Many of the other emails exposed regular, private, familiar communications between PG&E and certain CPUC commissioners, including former CPUC President Michael Peevey and current commissioner Peter Florio, as well as senior CPUC officials.

Criminal investigations opened. Since PG&E’s initial release of the emails, both the state Attorney General and the United States Department of Justice have opened investigations into communications between the CPUC and regulated entities. PG&E has fired three senior executives. A senior CPUC official has resigned, while other top CPUC officials – including longtime CPUC President Michael Peevey and Executive Director Paul Clannon – have retired under pressure. Investigators working with the Attorney General’s Office have raided the CPUC offices and the homes of former CPUC Commissioner President Peevey and PG&E former-Vice President Brian Cherry.

San Onofre Nuclear Generating Stations (SONGS). In early February, only after a newspaper published details of the search warrant, Southern California Edison disclosed a meeting that occurred two years prior in Warsaw, Poland between then-CPUC President Peevey and a utility executive in which they discussed how to resolve the shutdown plans for SONGS which had a failed steam generator that required the facility to be permanently retired. In November 2014, the CPUC approved a settlement agreement between utilities and ratepayer advocates that split the costs of retiring the facility and the associated replacement power, with ratepayers shouldering $3.3 billion of the $4.7 billion total costs. Some parties to the proceeding who were not parties to the agreement, filed multiple lawsuits against the agency and also requested public records related to the deal. With growing concerns about the process that resulted in the settlement agreement, The Utility Reform Network (TURN), one of the parties to the settlement, announced in June their request to the CPUC to withdraw the settlement and reopen the proceeding.

Audits reveal CPUC’s efforts are lacking. In recent years, the CPUC has undergone a number of audits related to its budget, transportation program, natural gas pipeline safety program and others. The findings of these audits have raised concerns about the ability of CPUC to manage even some of its core functions. A March 2014 audit by the State Auditors found that “the CPUC lacks adequate processes for sufficient oversight of utility balancing accounts to protect ratepayers from unfair rate increases.” The NTSB San Bruno investigation report and subsequent audits, have found that CPUC’s oversight of natural gas pipeline safety efforts by the utilities needs improvements.

Internal auditor. In response, the CPUC recently established an Internal Audit Unit, overseen by a Chief Internal Auditor, which performs audits of the CPUC’s internal controls and management, oversees organizational risk assessment and enterprise risk management, and provides consulting services as requested to assist CPUC operations. Internal Audit Unit reports directly to the CPUC, with the Chief functionally reporting to the commissioners through its Finance and Administration Committee, and operates under a charter approved by the CPUC on May 21, 2015. For day to day operations, the Chief reports administratively to the Deputy Executive Director of Budget and Finance. This bill would add an Inspector General, housed with the State Auditor’s Office, to audit and investigate activities of the CPUC and report its findings to the Legislature.

Role of the public advisor. The Public Advisor's Office provides procedural information and advice to individuals and groups who want to participate in formal CPUC proceedings. Additionally, the Office is required to inform the CPUC of barriers that prevent effective public participation. The Public Advisor’s Office also provide programs and services to educate and assist the public, including special accommodations and interpreter services. The proposal in AB 1330 (Bloom, 2015) expands the responsibilities of the Public Advisor’s Office. Should the bill move forward, the author may wish to more clearly define the role of the public advisor and the role of other staff for activities such as maintaining the website.

Transparency vs. Confidentiality. This bill proposes to more clearly define information collected of utilities that should be available to the public. Under current law, Public Utilities Code Section 583, states that “no information furnished to the CPUC by a public utility…, except those matters specifically required to be open to public inspection by this part, shall be open to public inspection or made public except on order of the CPUC, or by the CPUC or a commissioner in the course of a hearing or proceeding.” Regulated utilities point to this section to argue that there exists a presumption that their information is confidential unless a commissioner, on a case by case basis, decides it is not. In response to the numerous public records request the CPUC is receiving, including many that stemmed from the San Bruno explosion, the CPUC in February 2013 adopted a resolution to “provide the public with more immediate access to records of safety inspections, audits, and investigations.” The resolution, L-136, provides that the CPUC would disclose categories of routine safety-related records after any appropriate redactions, without requiring a vote of the commissioners or an Administrative Law Judge ruling. Furthermore, the resolution noted the agency’s intention to open a rulemaking “to address improving the public’s access to records that are not exempt under the California Public Records Act (CPRA) or other state or federal law” with a formal proceeding proposing amendments to General Order 66-C. As a follow-up to the adoption of the resolution, the CPUC commissioners voted on November 6, 2014 to adopt an Order Instituting Rulemaking (OIR) to “Improve Public Access to Public Records Pursuant to the California Public Records Act.” The adoption of the OIR has opened a current proceeding at the CPUC to address amendments to General Order 66-C, first adopted in 1974, which “identifies all CPUC records as public unless they fall within a short list of exemptions.” As part of the OIR, the CPUC stated that “Section 583 ‘neither creates a privilege of nondisclosure for a utility, nor designates any specific types of documents as confidential.’ (D.06-06-066, Section VII.). Section 583 precludes CPUC officers and employees from publicly releasing information provided to the CPUC by regulated utilities absent a CPUC order, and General Order 66-C is a CPUC order directing the disclosure of public records in compliance with the CPRA.” This bill would further provide parties to a proceeding to contest claims of confidentiality by filing a motion to make the information public and the assigned Administrative Law Judge or the commissioner would make a determination in written findings and conclusions.

About D.06-06-066. This CPUC decision implements provisions of SB 1488 (Bowen, Chapter 690, Statutes of 2004) which expressed a preference for open decision-making and requires an examination of CPUC practices regarding confidential information. Among the findings of the decision, the CPUC states that SB 1488 requires scrutiny of claims of confidentiality but does not prohibit all use of confidential information and provided specifics regarding handling of electricity procurement. Additionally, in the decision, the CPUC argues that “Section 583 does not require the CPUC to afford confidential treatment to date that does not satisfy substantive requirements for such treatment created by other statute and rules. This is important because several of the parties claim that there is a legal presumption of confidentiality for all data.”

Double referral. Should this bill be approved by this committee, it will be re-referred to the Senate Committee on Judiciary for its consideration.

Prior/Related Legislation

SB 48 (Hill, 2015) proposes a suite of reforms of the CPUC, including modifying the role of the president, meeting location requirements, and other reforms. The bill is scheduled to be heard in the Assembly Committee on Appropriations.

SB 215 (Leno, 2015) proposes a suite of reforms of the CPUC related to governance and operations, including disqualification of commissioners to proceedings, modifying the role of the president, modifying ex parte rules, and other reforms. The bill was held in this committee after merging much of its contents with SB 660.

SB 660 (Leno/Hueso, 2015) proposes a suite of reforms of the CPUC focused on ex parte communications rules, addressing the disqualification of commissioners in proceedings, modifying the powers of the president, and others. The bill is scheduled to be heard July 13^th in the Assembly Committee on Utilities and Commerce.

FISCAL EFFECT: Appropriation: No Fiscal Com.: Yes Local: Yes

ASSEMBLY VOTES:

Assembly Floor (79-0)

Assembly Appropriations Committee (17-0)

Assembly Judiciary Committee (10-0)

Assembly Utilities and Commerce Committee (14-0)

SUPPORT:

California Newspaper Publishers Association

California Teamsters Public Affairs Council

County of San Diego 2^nd Supervisorial District, Dianne Jacob

County of San Joaquin

Engineers & Scientists of California

IFPTE Local 20 AFL-CIO

Utility Workers Union of America, AFL-CIO

CONCERNS:

California Cable & Telecommunications Association

OPPOSITION:

None received

ARGUMENTS IN SUPPORT: Recent media reports have revealed a lack of transparency in decisions by the CPUC. Transparency in how public agencies make decisions remains a longstanding and fundamental principle in California law and government. AB 825 increases CPUC transparency in three ways: (1) requires disclosure of information on the web and requires other CPUC actions to help Californians participate in the CPUC process; (2) provides a process for challenging confidentiality of documents; and (3) provides for independent oversight, by an Inspector General in the State Auditor’s office.