BILL ANALYSIS
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|SENATE RULES COMMITTEE | SB 580|
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THIRD READING
Bill No: SB 580
Author: Escutia (D), et al
Amended: 4/26/05
Vote: 21
SENATE ENERGY, UTIL. & COMMUNICATIONS COMM. : 9-1, 4/5/05
AYES: Escutia, Alarcon, Battin, Bowen, Cox, Dunn, Kehoe,
Murray, Simitian
NOES: Campbell
NO VOTE RECORDED: Morrow
SENATE APPROPRIATIONS COMMITTEE : 7-2, 4/18/05
AYES: Migden, Alquist, Bowen, Escutia, Florez, Ortiz,
Speier
NOES: Aanestad, Ashburn
NO VOTE RECORDED: Battin, Dutton, Murray, Poochigian
SUBJECT : Public Utilities Commission: Low-Income
Oversight Board
SOURCE : Author
DIGEST : This bill expands the jurisdiction of the
Low-Income Oversight Board, an advisory board to the Public
Utilities Commission, to include low-income water
ratepayers' issues, and increases the membership of the
board, from nine to 11 members, as specified.
ANALYSIS:
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Existing law:
1.Establishes the Low-Income Oversight Board (LIOB) for the
purpose of advising the California Public Utilities
Commission (CPUC) on low-income electric and gas customer
issues and serving as a liaison for the CPUC to
low-income ratepayers and representatives. (SB 2XX
(Alarcon), Chapter 11, Statutes of 2001-02 Second
Extraordinary Session)
2.Requires the CPUC to consider and authorizes the CPUC to
implement programs for low-income water ratepayers to
provide rate relief and provide appropriate incentives
and capabilities to achieve water conservation goals.
(AB 2815, Chapter 549, Statutes of 1992)
This bill expands the purview and membership of the LIOB as
follows:
1.The LIOB's purview, which is currently limited to
advising the CPUC regarding low-income electric and gas
utility customer issues, is expanded to include water
utility customer issues.
2.The LIOB's membership is expanded from nine to 11 by the
addition of two members selected by the CPUC - one
additional member with expertise in the low-income
community and one member representing a water utility.
Comments
When established in 2001, the LIOB was intended to provide
input from the low-income community to the CPUC about the
policies and programs for low-income energy consumers,
particularly programs that support utility bill payments,
such as the California Alternative Rates for Energy (CARE)
program that provides rate discounts for eligible
low-income customers, and programs that reduce bills by
reducing energy demand, such as the low-income energy
efficiency (LIEE) programs.
At the time of SB 2XX's enactment, there was a perception
that significant improvement in low-income public purpose
programs was needed to lessen the hardship that high energy
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bills placed on low-income consumers. The issue with
respect to CARE was the relatively low rates of enrollment
of eligible customers, as compared with the rates of
enrollment for Universal Lifeline Telephone Service (ULTS),
the comparable program for low-income telephone
subscribers. SB2XX directed the LIOB and the CPUC to work
with the ULTS programs to improve CARE enrollment, with the
eventual goal of establishing universal enrollment of
eligible customers for all utility programs.
With respect to LIEE programs, the LIOB was directed to
provide policy and other input to the CPUC from the
perspective of the low-income community, including formal
studies, and to provide a channel of communication for
community-based organizations. In turn, the CPUC was
directed to provide staffing, technical assistance and
other forms of support to further the LIOB's purpose.
The LIOB has functioned relatively effectively for several
years. However, it has not had an in-person meeting for
over a year. Several of its initiatives, notably an
attempt to provide for automatic enrollment in CARE for
recipients of other forms of state economic assistance,
have stalled at the CPUC. The LIOB has not provided the
regular and continuous policy input envisioned by SB2XX.
The LIOB has discussed the importance of water service for
low-income Californians. The Public Utilities Code directs
the CPUC to consider and adopt programs to assure healthful
water service for low income customers (Section 739.8).
This bill adds to the mission of the LIOB consideration of
water issues for low-income customers and adds a
representative of the water industry to the LIOB.
FISCAL EFFECT : Appropriation: No Fiscal Com.: Yes
Local: No
Increased costs to the LIOB are probably under $100,000
annually. The LIOB is funded with PURA revenues. PURA
revenues are derived from an annual fee imposed on the
utilities. Therefore, any increased costs to the PUC for
the provisions of this bill should be offset by fee
revenues.
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SUPPORT : (Verified 4/27/05)
Association of California Community and Energy Services
Maravilla Foundation
Southern California Forum
Southland Energy Systems
ARGUMENTS IN SUPPORT : Proponents argue that, currently,
CPUC-regulated water utilities don't have low-income rates.
Notwithstanding the policies and requirements in existing
law regarding affordable water for low-income customers,
the CPUC has been unable to develop a low-income water rate
design modeled on CARE (i.e., funded by a surcharge on
other customers' bills). The difficulty is due in large
part to the structure of the regulated water industry.
(Relatively small scale entities, with federated structures
based on districts or communities that have historically
not had uniform rates, which makes subsidy issues even more
difficult.) As water quality requirements increasingly
impact costs and rates for small water utilities, the
importance of addressing affordability issues for
low-income customers will be increasingly important. The
fundamental impediments to subsidizing basic water needs
will remain, but the LIOB may be able to provide useful
advice to the CPUC on the subject.
NC:nl 4/27/05 Senate Floor Analyses
SUPPORT/OPPOSITION: SEE ABOVE
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