BILL ANALYSIS ------------------------------------------------------------ |SENATE RULES COMMITTEE | AB 1735| |Office of Senate Floor Analyses | | |1020 N Street, Suite 524 | | |(916) 445-6614 Fax: (916) | | |327-4478 | | ------------------------------------------------------------ THIRD READING Bill No: AB 1735 Author: Assembly Utilities and Commerce Committee Amended: 8/18/03 in Senate Vote: 21 SENATE ENERGY, U.&C. COMMITTEE : 6-0, 7/8/03 AYES: Bowen, Alarcon, Dunn, McClintock, Murray, Vasconcellos NO VOTE RECORDED: Morrow, Battin, Sher SENATE APPROPRIATIONS COMMITTEE : Senate Rule 28.8 ASSEMBLY FLOOR : 79-0, 6/3/03 - See last page for vote SUBJECT : State Public Utilities Commission: ratesetting and quasi- legislative cases SOURCE : Author DIGEST : This bill requires the State Public Utilities Commission to resolve all ratesetting and quasi-legislative cases within 18 months of the date of filing, as specified. ANALYSIS : Current law requires the State Public Utilities Commission (PUC) to assign its cases into one of three categories: adjudication, quasi-legislative, and ratesetting. Adjudications are required to be completed within 12 months, unless the PUC orders the deadline extended. Under current law, it's the intent of the Legislature that all other proceedings be completed within CONTINUED AB 1735 Page 2 18 months. Current law requires the PUC to annually publish a work plan describing the scheduled decisions in the coming year. Current law requires the PUC to annually report on the number of cases where resolution exceeded the time prescribed in the scoping memos and the number of days that commissioners presided in hearings. This bill requires quasi-legislative and ratesetting cases to be resolved within 18 months of the date the scoping memo is issued, unless the PUC makes a written determination that the deadline cannot be met and issues an order extending the deadline. No single order may extend the deadline for more than 60 days. This bill includes language that allows the PUC to exceed the 18-month timeframe if the scoping memo for the case explains why a longer timeframe is required, and the commissioner assigned to the case agrees. This bill requires the President of the PUC to annually appear before the appropriate policy committees of the Senate and Assembly to report on the PUC's work plan for the coming year, the timeliness with which the PUC completed its work in the prior year, and the number of days commissioners presided in hearings. Background In the mid-1990's there was a concern that the PUC was an unaccountable body whose decisions were staff-driven and made on a deadline of the PUC's own choosing without regard for the need for expeditiousness. In 1996, the Governor signed SB 960 (Leonard), Chapter 856, Statutes of 1996, which revised the PUC's processes by establishing three types of cases: adjudicatory cases, such as enforcement and complaint cases, quasi-legislative cases, where policies are established, and ratesetting cases, where rates are established, and creating specific processing rules for each type of case. AB 1735 Page 3 Prior to starting any case, the PUC is required to hold a hearing establishing the type of case, the issues to be considered, and the timetable for resolution, which are all contained in a scoping memo. Adjudicatory cases are to be resolved within 12 months, though the PUC can extend the deadline if necessary. Quasi-legislative and ratesetting cases do not have firm resolution deadlines established, though the intent of the Legislature is that those cases be resolved within 18 months. SB 960 also declared the intent of the Legislature that PUC commissioners be more directly involved in the PUC's decisions, and encouraged the timely resolution of cases. It required the PUC to annually report to the Legislature on the number of cases that took too long to resolve and the number of days commissioners presided in hearings. Comments This bill codifies the intent of the Legislature established in SB 960 with regard to the speed with which the PUC must resolve a case. The 18-month deadline isn't an absolute deadline, because the PUC can extend it if it articulates the reasons for an extension and issues an order, just as it can now do for adjudicatory cases. While 18 months seems like a long time, resolving a case can be a complicated matter. The parties must go through a discovery process, formulate a case, prepare testimony, present witnesses and cross-examine opposing witnesses, and brief the case, while the PUC must subsequently examine the record, issue a proposed decision, issue alternate decisions, and vote. This might not be such a chore if the PUC was processing one case at a time, but typically the PUC has dozens, if not hundreds, of cases of varying complexity open at any one time. Some PUC cases extend for several years as the issues are dealt with in phases, with the character of the second phase dependent on the outcome of the first. The PUC is already required to issue a report to the Legislature on the number of cases that took too long to resolve, the number of days commissioners presided in hearings, what the commission did in the prior year, and AB 1735 Page 4 what it intends to do in the following year. This bill requires the PUC President to deliver that report in person to the relevant Senate and Assembly policy committees. FISCAL EFFECT : Appropriation: No Fiscal Com.: Yes Local: No SUPPORT : (Verified 8/18/03) State Public Utilities Commission Pacific Gas and Electric Company SBC ASSEMBLY FLOOR : AYES: Aghazarian, Bates, Benoit, Berg, Bermudez, Bogh, Calderon, Campbell, Canciamilla, Chan, Chavez, Chu, Cogdill, Cohn, Corbett, Correa, Cox, Daucher, Diaz, Dutra, Dutton, Dymally, Firebaugh, Frommer, Garcia, Goldberg, Hancock, Harman, Haynes, Jerome Horton, Shirley Horton, Houston, Jackson, Keene, Kehoe, La Malfa, La Suer, Laird, Leno, Leslie, Levine, Lieber, Liu, Longville, Lowenthal, Maddox, Maldonado, Matthews, Maze, McCarthy, Montanez, Mountjoy, Mullin, Nakanishi, Nakano, Nation, Negrete McLeod, Nunez, Oropeza, Pacheco, Parra, Pavley, Plescia, Reyes, Richman, Ridley-Thomas, Runner, Salinas, Samuelian, Simitian, Spitzer, Steinberg, Strickland, Vargas, Wiggins, Wolk, Wyland, Yee, Wesson NC:mel 8/19/03 Senate Floor Analyses SUPPORT/OPPOSITION: SEE ABOVE **** END ****