BILL ANALYSIS SB 33 Page 1 SENATE THIRD READING SB 33 (Peace) As Amended July 7, 1999 Majority vote SENATE VOTE : 26-9 UTILITIES AND COMMERCE 11-1 APPROPRIATIONS 14-7 ----------------------------------------------------------------- |Ayes:|Wright, Pescetti, |Ayes:|Migden, Cedillo, Davis, | | |Calderon, Campbell, | |Hertzberg, Kuehl, Papan, | | |Cardenas, Maddox, | |Romero, Keeley, | | |Mazzoni, Thomson, Reyes, | |Steinberg, Thomson, | | |Vincent, Wesson | |Wesson, Wiggins, Wright, | | | | |Aroner | | | | | | |-----+--------------------------+-----+--------------------------| |Nays:|Frusetta |Nays:|Brewer, Ackerman, | | | | |Ashburn, Campbell, | | | | |Maldonado, Runner, Zettel | ----------------------------------------------------------------- SUMMARY : Transfers authority from the California Public Utilities Commission (CPUC) to the Governor to designate a president of CPUC and requires the president to direct the staff of CPUC, as specified. Specifically, this bill : 1)Requires the Governor to designate the president of CPUC from among its members. 2)Requires the president to direct the executive director, the attorney, and other CPUC staff, except for the staff of the division which represents the interests of public utility customers and subscribers in CPUC proceedings, in the performance of their duties, in accordance with CPUC policies and guidelines. 3)Specifies that the attorney and executive director may be directed in their duties by a vote of CPUC, as prescribed. 4)Authorizes the Governor, until January 1, 2003, to appoint up to two advisers for each member to CPUC, and prohibits the total number of advisers exempt from civil service from SB 33 Page 2 exceeding 10. 5)Requires CPUC to seek funding for staffing in accordance with that appointment provision through the annual Budget Act. EXISTING LAW : 1)Requires the members of CPUC to elect the president of CPUC. 2)Permits CPUC to appoint its own attorney and executive director who perform at the direction of CPUC. 3)Permits each commissioner to have one adviser who is exempt from civil service. FISCAL EFFECT : CPUC estimates annual special fund costs of about $400,000 for the five additional advisors. COMMENTS : Under existing law, the president of CPUC is elected by the members of CPUC. This bill would transfer authority for designating the president of CPUC from CPUC to the Governor. Additionally, this bill would require the president to direct CPUC staff, including CPUC attorney and executive director, except when directed otherwise by a vote of CPUC. Staff representing ratepayers in CPUC proceedings would be excluded from these provisions. CPUC (originally named the Railroad Commission) was created in 1911. In order to maximize CPUC's independence from the entities it regulated, CPUC was located in San Francisco. Additionally, numerous provisions were established to preserve CPUC's independence. Then as now, CPUC members were appointed by the Governor for staggered six-year terms, and could be removed from office only for certain very limited reasons by a two-thirds vote of both houses of the Legislature. This prevents an incoming Governor from immediately appointing a majority of CPUC, and enables CPUC to maintain some measure of independence from the state's chief executive. CPUC's independence, once seen as its greatest strength, is now seen by some as a weakness or flaw. In recent years, numerous stakeholders have expressed frustration with CPUC's lack of accountability. This bill would increase CPUC's accountability to the incumbent governor by providing the chief executive with the authority to designate the president of CPUC. CPUC SB 33 Page 3 executive director, attorney, and most members of CPUC staff, would be directed by the gubernatorially-appointed president. Existing law permits each commissioner to have one adviser who is exempt from civil service. This bill provides that, until January 1, 2003, each commissioner may instead have up to two advisers who are exempt from civil service and would prohibit the total number of advisers exempt from civil service from exceeding 10. In 1996, the Legislature passed SB 960 (Leonard), Chapter 856, Statutes of 1996, which significantly increased commissioner workload and participation in hearings. Increasing the number of civil service-exempt advisers would help enable commissioners to handle their increased workload. Increasing the number of civil service-exempt commission advisers would make the commissioners less reliant on the professional staff at CPUC, and would likely result in CPUC decisions reflecting more of the values and judgments of the commissioners and less those of professional staff. Opponents of this bill argue that increased reliance on short-term political appointees would make political considerations more important than market facts, economic facts, and customer-service facts that constitute the record in commission proceedings. At a recent meeting, CPUC voted to support this measure. Analysis Prepared by : Joseph Lyons / U. & C. / (916) 319-2083 FN: 0002929