BILL ANALYSIS                                                                                                                                                                                                                   1
               1





             SENATE ENERGY, UTILITIES AND COMMUNICATIONS COMMITTEE
                            DEBRA BOWEN, CHAIRWOMAN
          

          SB 201 -  Speier                                  Hearing  
          Date:  April 24, 2001                S
          As Introduced: February 8, 2001         FISCAL           B
                                                                       
            
                                                                       
            2
                                                                       
            0
                                                                       
            1

                                   DESCRIPTION
           
           Current law  establishes a division within the California  
          Public Utilities Commission (CPUC) to represent the  
          interests of public utility customers in CPUC proceedings.   
          The director of the division, known as the Office of  
          Ratepayer Advocate (ORA), serves at the pleasure of the  
          Governor and is subject to confirmation by the Senate.  The  
          Governor's ability to appoint the ORA director and the  
          specific Ratepayer Advocate Account in the General Fund are  
          scheduled to sunset on January 1, 2002.

           Current law  provides that should the sunset take place, the  
          law would return to the way it read prior to 1997 whereby  
          the CPUC appointed and funded the ORA to represent the  
          interests of utility customers and subscribers in CPUC  
          proceedings.

           This bill  removes the sunset, requires the ORA director to  
          be paid a salary equal to 90% of that received by the CPUC  
          commissioners, and deletes the replacement section of law  
          that would take effect should the sunset actually take  
          place.

                                    BACKGROUND
           
          ORA is the state-sanctioned representative of consumers at  
          the CPUC and it's required to participate in all  











               significant electric, telecommunications, natural gas, and  
               water cases.  In the smallest cases, ORA may provide the  
               only financial analysis of the case, but in larger cases,  
               ORA frequently presents the only comprehensive alternative  
               analysis to the one put forth by the utility.

               In 1996, concurrent with the electric restructuring effort,  
               the existing ORA was modified to make its director a  
               Governor's appointment and to provide a separate line item  
               within the CPUC budget. The purpose of this change was to  
               ensure ORA accountability.  Without this bill, those  
               provisions will sunset, meaning ORA will be returned to its  
               former status and make its director an appointee of the  
               CPUC.

               Many other consumer groups are represented at the CPUC.  In  
               order to encourage participation, state law provides for  
               compensation of costs if that group makes a substantial  
               contribution to the case and participation by that group  
               couldn't occur without significant financial hardship, as  
               determined by the CPUC.

































                                     COMMENTS
           
           1)Narrow Or Wide Vision?   The statute creating ORA has been  
            narrowly read by some utilities to limit its activities  
            to formal proceedings at the CPUC.  This is inconsistent  
            with the original purpose for creating ORA, which was to  
            create an advocate for ratepayers and to give that  
            advocate all of the same broad investigatory powers  
            possessed by the CPUC.  Should that narrow interpretation  
            prevail, ORA could be barred from investigating issues  
            which could lead to formal proceedings.  As such,  the  
            author and committee may wish to consider  clarifying this  
            by deleting the phrase "in commission proceedings" on  
            Page 2, Line 6.

           2)Salary  .  This bill statutorily sets the salary of the ORA  
            director at 90% of the salary paid to CPUC commissioners.  
             The salary for the President of the CPUC is set by  
            Government Code Section 11553, while the remaining CPUC  
            commissioners have their salary set by Government Code  
            Section 11553.5.  Today, the other four CPUC  
            commissioners receive a salary of $114,191 each, while  
            the CPUC President receives a slightly higher  
            (approximately 3%) salary.

            On March 21, 2001, Regina Ann Birdsall was appointed by  
            the Governor to head the ORA at a salary of $101,220,  
            which is approximately 88.6% of the salary paid to four  
            of the commissioners, but somewhat less than that if one  
            factors in the higher salary paid to the CPUC President.

            It's not clear why the ORA director's salary should be  
            set in statute.   The author and committee may wish to  
            consider  deleting this provision, leaving the director's  
            salary in the hands of the Department of Personal  
            Administration.

                                    POSITIONS
           
           Sponsor:
           
          Author

           Support:










                
               None on file

                Oppose:
                
               None on file

               

               Randy Chinn 
               SB 201 Analysis
               Hearing Date:  April 24, 2001