BILL ANALYSIS ------------------------------------------------------------ |SENATE RULES COMMITTEE | SB 1217| |Office of Senate Floor Analyses | | |1020 N Street, Suite 524 | | |(916) 445-6614 Fax: (916) | | |327-4478 | | ------------------------------------------------------------ THIRD READING Bill No: SB 1217 Author: Polanco (D) Amended: 5/28/99 Vote: 21 SENATE ENERGY, U.&C. COMMITTEE : 8-3, 5/11/99 AYES: Bowen, Alarcon, Baca, Hughes, Peace, Solis, Speier, Vasconcellos NOES: Brulte, Kelley, Mountjoy SENATE APPROPRIATIONS COMMITTEE : 8-1, 5/24/99 AYES: Johnston, Alpert, Bowen, Burton, Escutia, Karnette, Perata, Vasconcellos NOES: Leslie NOT VOTING: Johnson, Kelley, McPherson, Mountjoy SUBJECT : Public Utilities Commission SOURCE : Author DIGEST : This bill codifies the existence of six Public Utilities Commission advisory boards and makes related changes. The bill also requires the Bureau of State Audits to conduct a performance and financial audit of the Department of Community Services and Development. ANALYSIS : Part 1: CONTINUED SB 1217 Page 2 Current law requires the California Public Utilities Commission (CPUC) to administer six telecommunications programs, created pursuant to statute and paid for by consumers via their telephone bills. The CPUC appoints advisory boards to each of these programs to assist in the administration. This bill codifies the advisory boards for each of the six programs and creates accounts in the state treasury to hold the program funds. Part 2: Current law establishes programs to finance cost-effective energy efficiency and conservation activities and low income rate assistance which are funded by ratepayers and administered by utility companies. This bill requires the Bureau of State Audits to conduct a performance and financial audit of the Department of Community Services and Development (Department) to consider the efficiency of the Department's administration of federal low income energy assistance programs. A report is to be presented to the chairs of specified legislative committees by July 1, 2000. This bill requires the California Public Utilities Commission (CPUC), if it elects to competitively bid the state's low income energy assistance program, to evaluate the bids based on cost and quality criteria. The quality criteria shall include whether the bidder has experience and is effective at doing similar work, has knowledge of the targeted communities, and has an ability to reach targeted communities. Comments : Part 1: The CPUC has implemented six statutorily authorized programs, funded by utility customers, whose aggregate revenues exceed $1 billion annually. The funds are held in trust. According to the CPUC, both the Attorney General and the Department of Finance have informally expressed SB 1217 Page 3 their preference that the funding for these programs be kept with the state and that the advisory boards be codified. The specific advisory boards and funds created by this bill include: 1.The California High-Cost Fund-A Administrative Committee and Fund, designed to keep rates for rural telephone companies low. 2.The California High Cost Fund-B Administrative Committee and Fund, designed to keep rates for rural customers low. 3.The Universal Lifeline Telephone Service Trust Administrative Committee and Fund, designed to provide low cost telephone service to low income households. 4.The Deaf and Disabled Telecommunications Program Administrative Committee and Fund, designed to provide discounted telephone service and equipment to the deaf and disabled. 5.The Payphone Service Providers Committee and Fund, designed to provide consumer protection to pay telephone customers. 6.The California Teleconnect Fund Administrative Committee and Fund, designed to fund advanced communications services for schools, libraries, and community organizations. This portion of the bill simply formalizes the current programs by codifying the CPUC-created advisory boards and creates funds in the state treasury to hold the monies from each program. This part of the bill is substantially similar to AB 2461 (Campbell) of last year, which was vetoed by the Governor because it provided for additional civil service positions. Part 2: The remaining provisions of the bill deal with the administration of the California Alternate Rates for Energy SB 1217 Page 4 program (CARE), a discount energy rate program for low income customers, and the Low Income Energy Efficiency program (LIEE), an energy efficiency program for low income customers. The CARE program costs $125 million annually and provides eligible low income gas and electric customers with a 15% credit against their bill. The LIEE program costs $60 million annually and provides home weatherization and energy efficiency devices, such as energy efficient lighting, to qualifying customers, whether they are property owners or renters. The LIEE programs are contracted out to numerous community-based organizations usually, but not exclusively, on a competitive-bid basis. The bill requires that if the CPUC contracts out the LIEE programs on a competitive-bid basis, the bid criteria shall include quality of service criteria. The bill also requires an audit of the Department to see if they would be an appropriate entity for administering these programs in the future. FISCAL EFFECT : Appropriation: No Fiscal Com.: Yes Local: Yes Codification of advisory boards (cost shift) -- No new program costs; all costs will continue to be paid from the appropriate special funds. Audit -- Unknown, less than $150,000 from the General Fund. SUPPORT : (Unable to verify at time of writing) ASCEEP Bay Area Poverty Resource Council California Department of Community Services and Development Campesinos Unidos, Inc. Community Enhancement Services CPUC Eddie Dillen Companies MAAC Project Maravilla Foundation Pacific Asian Consortium in Employment Pacific Bell Riverside County Department of Community Action San Bernardino County Community Services Department Santa Barbara County Community Action Commission SB 1217 Page 5 Spectrum Community Services, Inc. Inter-City Energy Systems, Inc. Ventura County Commission on Human Concerns & Community Development Veterans in Community Service, Inc. OPPOSITION : (Unable to verify at time of writing) El Dorado County Department of Community Services Inyo Mono Advocates for Community Action, Inc. Latino Issues Forum Office of Ratepayer Advocates Southern California Edison NC:jk 5/29/99 Senate Floor Analyses SUPPORT/OPPOSITION: SEE ABOVE **** END ****