BILL ANALYSIS
SB 580
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Date of Hearing: June 20, 2005
ASSEMBLY COMMITTEE ON UTILITIES AND COMMERCE
Lloyd E. Levine, Chair
SB 580 (Escutia) - As Amended: April 26, 2005
SENATE VOTE : 31-8
SUBJECT : Public Utilities Commission: Low-Income Oversight
Board
SUMMARY : Expands the California Public Utilities Commission
(PUC) Low-Income Oversight Board (LIOB) purview to include water
utility customer issues in addition to the existing electric and
gas customer issues. Specifically, this bill :
1)Expands the LIOB purview to include water utility customer
issues to the existing electric and gas customer issues, on
which the LIOB advises the PUC.
2)Increases the number of LIOB board members from 9 to 11. One
of the new members would be selected by the PUC and possess
expertise in the low-income community, and one new member
would be a representative of a water corporation.
EXISTING LAW:
1)Establishes the LIOB to advise the PUC on low-income electric
and gas customer issues and serve as a liaison for the PUC to
low-income ratepayers and representatives.
2)Requires the PUC to consider, and permits the PUC to implement
programs to assist low-income ratepayers in order to provide
appropriate incentives and capabilities to achieve water
conservation goals.
3)Establishes a LIOB to advise the PUC on low-income electric
and gas customer issues. Includes nine members, comprised of
four members selected by the PUC who have expertise in the
low-income community, one member selected by the PUC who is a
representative of an electrical or gas corporation, and others
including one selected by the Governor, one selected by the
Department of Community Services and Development, a private
weatherization contractor, and a commissioner.
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FISCAL EFFECT : Unknown.
COMMENTS : According to the author, the purpose of this bill is
to more effectively implement Public Utilities Code Section
739.8, which requires the PUC to consider, and permits the PUC
to implement programs to provide rate relief for low-income
ratepayers.
1) Just add water : When established in 2001, the LIOB was
intended to provide input from the low-income community to the
PUC about the policies and programs for low-income energy
consumers, particularly programs that support utility bill
payments. At that time, there was a perception that significant
improvement in low-income public purpose programs was needed to
lessen the hardship that high energy bills placed on low-income
consumers.
Current law requires the LIOB to advise the PUC on low-income
electric and gas customer issues. Of those issues, the LIOB
advises the commission about the California Alternative Rates
for Energy (CARE) program that provides rate discounts for
eligible low-income customers, and the low-income energy
efficiency (LIEE) programs that attempt to reduce bills by
reducing energy demand. Current law also requires the PUC to
consider programs to assist low-income water ratepayers;
however, it permits the PUC to determine the feasibility of rate
relief and provides the PUC the prerogative to implement a
program.
This bill would add water issues to the LIOB's purview; however,
it would not change current law to require the PUC to implement
programs. The LIOB can currently discuss water issues and
according to the author, the PUC has unsuccessfully attempted to
address water rate issues for low-income customers in a number
of rate cases.
2) Additional board members: This bill would increase the
number of board members from 9 to 11; however, it may not
provide water rate relief or conservation measures to low-income
customers. One of the proposed new board additions would be
another expert in the low-income community to make it five, and
one new addition would represent a water utility. It is unclear
how the new additional board positions would contribute to the
LIOB. There are currently four members with expertise in the
low-income community. According to the author, the option of
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converting one of the low-income positions to a water
corporation positions was not considered.
If additional members are appointed, there's no indication that
it would increase the LIOB's effectiveness. The LIOB has not
had an in-person meeting for over a year, and several of its
initiatives have stalled at the PUC.
The presence of a water utility representative on the board may
be appropriate given current law, which requires the PUC to
consider rate relief or conservation programs for low-income
water customers. However, increasing the number of members may
not necessarily increase the chances of creating a new program
without a dedicated funding source. This bill does not provide
for a funding source to pay for any water-related programs that
the new larger board might develop for consideration by the PUC.
Even if a water program is proposed, it can't be funded without
increasing a surcharge on all utility customers or redirecting
funds from existing low-income utility programs, which could
dilute those existing programs.
The PUC redirects resources from its existing programs to
provide administrative and technical support for the low-income
programs. Currently, for about three to four weeks per year,
2.0 to 4.0 personnel years (PYs) are redirected from the Energy
Division. According to the PUC, this bill may require the LIOB
to hold a few more meetings and Water Division staff would be
required to provide water technical support to the board. It is
not clear which existing programs or responsibilities would
decline in resources and effectiveness to accommodate the
additional water element.
REGISTERED SUPPORT / OPPOSITION :
Support
None on file.
Opposition
None on file.
Analysis Prepared by : Gina Mandy / U. & C. / (916) 319-2083