BILL ANALYSIS
SENATE JUDICIARY COMMITTEE
Martha M. Escutia, Chair
2003-2004 Regular Session
SB 772 S
Senator Bowen B
As Introduced
Hearing Date: April 22, 2003 7
Public Resources Code 7
GMO:rm 2
SUBJECT
State ERCDC Reports: Confidentiality and Disclosure
DESCRIPTION
This bill would establish the test to be used by the State
Energy Resources Conservation and Development Commission
(ERCDC) in granting a written request for disaggregated or
unmasked records of confidential information it has
received or developed.
BACKGROUND
SB 1389 (Bowen, Chapter 568, Statutes of 2002) repealed the
planning and forecasting provisions of the Warren-Alquist
State Energy Resources Conservation and Development Act and
enacted a new mandate for the ERCDC to prepare an
integrated energy policy report, based on data to be
collected and information to be developed by the
commission.
As heard and approved by the Senate, SB 1389 contained
specific provisions for the handling of requests for
records of information submitted to the ERCDC for the
purpose of preparing the Integrated Energy Policy Report.
This bill also contained language comporting its provisions
with the requirements, intent and interpretation of the
Public Records Act (PRA), which generally applies to
records of all public agencies. This language was deleted
from SB 1389 in the Assembly, and the enrolled form of the
bill.
(more)
SB 772 (Bowen)
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SB 772 would reinsert this language into Public Resources
Code (P.R.C.) Section 25322.
CHANGES TO EXISTING LAW
Existing law permits persons submitting information to the
state ERCDC for the purpose of developing the Integrated
Energy Policy Report to request that specific information
be held in confidence, and requires the ERCDC to grant the
request under specified circumstances.
Existing law deems confidential information presented to or
developed by the ERCDC as required by law. Existing law
requires the ERCDC to aggregate or mask confidential
information to the extent necessary to assure
confidentiality if public disclosure of the specific
information would result in unfair competitive disadvantage
to the person supplying the information.
Existing law provides the procedure for handling requests
for records of information collected or developed by the
ERCDC. With respect to a request to disclose a
disaggregated or unmasked record of information designated
as confidential by the ERCDC, existing law requires the
ERCDC to deny the request if the disclosure will result in
an unfair competitive disadvantage to the person that
submitted the information.
This bill , with respect to a request to disclose a
disaggregated or unmasked record of information designated
as confidential by the ERCDC, would require the commission
to grant the request if the disclosure would not result in
unfair competitive disadvantage to the person that
submitted the information, unless the public interest
served by nondisclosure clearly outweighs the public
interest served by disclosure, or unless another applicable
provision of law exempts the information from disclosure.
COMMENT
1. Need for the bill
SB 772 (Bowen)
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The author states that even though she agreed to delete
this provision from SB 1389 when that bill was heard in
the Assembly Utilities and Commerce Committee, she
believes that it "strikes the proper balance between the
private interest in maintaining the confidentiality of
sensitive commercial information and the public interest
in understanding the functioning of energy markets and
institutions which serve as the basis for important
public decisions."
2. The Public Records Act compared to P.R.C. Sec. 25322:
the balancing test
The Public Records Act requires public agencies, upon
request by any person, to make available for inspection
or copying records it maintains. [Gov. Code Sec. 6250 et
seq.] The basic principle underlying the PRA is that all
records kept by a public agency are disclosable unless
exempt from disclosure. Thus, the PRA provides a long
list of records that are exempt from disclosure (such as
personnel and medical records, which are confidential and
require a court order or a request to be made by the
person entitled to the record), and establishes a process
for the court to review the denial of a request for
public records. When a request for inspection or copying
of a public record is denied, it is usually because the
record is specifically exempt from disclosure. Where a
record is not exempt, but the agency denies the request,
the person requesting the record may petition the court
for an order requiring disclosure. The court, in that
case, weighs the public interest served in having the
record disclosed against the public interest served by
not disclosing the record and denies the request if the
public interest served by not having the record disclosed
clearly outweighs the public interest served by
disclosure.
Public Resources Code Section 25322 provides the manner
by which the ERCDC must handle requests for records of
information submitted to it by various business interests
that deal with energy resources. Some of the information
submitted may be confidential, and some not. Section
25322 provides a means for the submitting party to
request that the information provided to the commission
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be held in confidence, and the commission is required to
grant the request under one of three circumstances: (1)
the information is confidentiality exempt from the Public
Records Act; (2) the information is confidential
(proprietary) under specified regulations; or (3) on the
facts of the case the public interest served by not
disclosing the information clearly outweighs the public
interest served by disclosure.
Sec. 25322 also authorizes the commission to designate,
by regulation, certain categories of information as
confidential, thus removing the necessity for a
submitting party to request confidentiality for certain
information. Lastly, all information held in confidence
by the commission is aggregated or masked to the extent
necessary to assure confidentiality if public disclosure
of the specific information would result in an unfair
competitive disadvantage to the party that submitted the
information.
SB 772 deals with a written request for disaggregated or
unmasked record of information deemed confidential by the
commission at the request of the submitting party, or
because it falls within a category designated
confidential by regulation. Current law [P.R.C.
25322(b)(2)] requires that when the commission receives a
written request for this record, notice of the request
shall be provided to the party that submitted the
information. Within five working days of the receipt of
the notice, the submitting party must provide written
justification of the claim of confidentiality. Within 20
working days of its receipt of the written request, the
commission is required to issue its ruling.
Under current law, the commission must deny the request
if the disclosure would result in an unfair competitive
disadvantage to the party that submitted the information.
If it grants the request, it must withhold disclosure
for up to 14 working days to allow the submitting party
to seek judicial review of the commission's decision to
grant the request.
The law does not provide a standard for the commission to
use in determining when a request may be granted. SB 772
provides that standard of review, following as closely as
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possible the standard of review that a court would use
under the Public Records Act, i.e., that disclosure would
be granted unless the public interest served by not
disclosing the information clearly outweighs the public
interest served by disclosing the information.
Obviously, if there is another applicable provision of
law that would exempt the information, the commission
(and a court hearing a petition under the PRA) must deny
the request for disclosure.
It should be noted that the commission's discretion to
grant the request for information under these
circumstances is predicated on first finding that
disclosure will not result in an unfair competitive
disadvantage to the party that submitted the information.
This is a fairly high hurdle to jump, so that in most
cases, if a party that submitted the requested
information can make a colorable claim that disclosure
would result in "unfair competitive disadvantage" to that
party, the commission will deny the request.
Opponents of the bill believe otherwise. They state that
once information has been determined to be confidential,
it should remain so, and the market participant should
not be required to repeatedly defend the confidentiality
of information. [Letter of opposition from Sempra Energy
dated April 14, 2003.] This may make sense, except that
under existing law, the party submitting the confidential
information must already show that disclosure of the
requested disaggregated or unmasked information will
result in unfair competitive disadvantage to the
submitter. If the submitter fails that test, then the
commission, in the absence of the balancing test using
public interests, may grant the request. In that case,
the submitter will probably end up in court, where the
court would apply that same balancing test that it
applies to cases involving the Public Records Act. By
allowing the commission to apply the test after a finding
that the submitter of information failed to show unfair
competitive disadvantage resulting from disclosure, the
submitter would have a preview of how a court may look at
the public interests involved, and may save itself the
trouble of going to court.
3. Suggested amendment
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In order to ensure that information withheld or made
confidential by the ERCDC either through a case-by-case
basis or through a categorical designation remains
confidential and exempt from disclosure under the Public
Records Act, the author may want to include a provision
to that effect. The same type of amendment has been used
in other legislation dealing with confidential
information received or maintained by public agencies,
where it would be impractical to include such information
as an exemption to the PRA within the Act itself. The
following amendment is suggested:
Add a subdivision (f) to read:
(f) Information withheld by the commission pursuant
to this section is not subject to disclosure under the
Public Records Act (Chapter 3.5 (commencing with Section
6250) of Division 7 of Title 1 of the Government Code).
4. Conflict with AB 808
AB 808 (Richman) would create a new Department of Energy
that would take over the responsibilities of various
agencies, including the State ERCDC. The bill would
repeal Section 25322 of the Public Resources Code.
Support: None Known
Opposition: Sempra Energy, Inc.
HISTORY
Source: Author
Related Pending Legislation: None Known
Prior Legislation: SB 1389 (Bowen, Chapter 568, Statutes of
2002) See Background
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