BILL ANALYSIS
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|SENATE RULES COMMITTEE | SB 1939|
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UNFINISHED BUSINESS
Bill No: SB 1939
Author: Alarcon (D)
Amended: 8/28/00
Vote: 21
SENATE ENERGY, U.&C. COMMITTEE : 8-2, 5/9/00
AYES: Bowen, Alarcon, Hughes, Mountjoy, Murray, Peace,
Solis, Vasconcellos
NOES: Brulte, Kelley
SENATE LOCAL GOVERNMENT COMMITTEE : 4-0, 5/17/00
AYES: Johannessen, Johnston, Soto, Rainey
SENATE APPROPRIATIONS COMMITTEE : Senate Rule 28.8
SENATE FLOOR : 23-10, 5/31/00
AYES: Alarcon, Alpert, Bowen, Burton, Chesbro, Costa,
Dunn, Escutia, Figueroa, Hayden, Hughes, Johnston,
Murray, O'Connell, Ortiz, Peace, Perata, Polanco, Schiff,
Sher, Solis, Soto, Speier
NOES: Brulte, Haynes, Kelley, Knight, Leslie, Lewis,
McPherson, Monteith, Mountjoy, Poochigian
ASSEMBLY FLOOR : 60-17, 8/29/00 - See last page for vote
SUBJECT : Public utilities: electric power: irrigation
districts
SOURCE : Latino Issues Forum
DIGEST : This bill requires local publicly-owned
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utilities, including irrigation districts, which have not
implemented programs for low-income electricity customers,
to perform a needs assessment and establish rate assistance
and energy efficiency programs, and prohibits irrigation
districts from providing electric transmission or
distribution service to retail customers in another
utility's service territory unless the district certifies
by ordinance that it provides public purpose programs, and
has universal service, consumer protection, and
environmental policies comparable to those of the incumbent
utility provider. Additionally, makes various changes to
irrigation district voting requirements.
Assembly Amendments :
1. Delete a provision that required a portion of the
electric surcharge collected for various public purpose
programs be used to provide a 15% rate discount for
low-income customers.
2. Requires certain local publicly-owned electric utilities
to conduct an assessment of needs for low-income
programs,
3. Add provisions that restrict irrigation districts from
providing electrical service unless certain conditions
are met.
4. Double-join Section 2 of the bill to AB 2638 (Calderon).
ANALYSIS : Existing law:
1. Requires each local publicly-owned utility to establish
a nonbypassable usage based charge to fund investments
in specified public purpose programs, including
providing services for low-income electricity customers.
2. Provides that the delivery of electricity over
transmission and distribution systems is currently
regulated, and will continue to be regulated to ensure
system safety, reliability, environmental protection,
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and fair access for all market participants.
3. Provides that the transmission and distribution of
electric power remain essential services imbued with the
public interest that are provided over facilities owned
and maintained by the state's investor-owned utilities
(IOUs).
4. Authorizes irrigation districts to generate, transmit,
and distribute electricity, including sale to
municipalities, public utility districts, or persons.
5. Allows municipal utilities and irrigation districts to
provide electric service both inside and outside the
boundaries of their service territory.
6. Requires a member of the board of directors of an
irrigation district to be a voter and a freeholder of
the district and a resident of the division that the
director represents at the time of nomination or
appointment and during the director's entire term.
This bill requires local publicly-owned utilities,
including irrigation districts, which have not implemented
programs for low-income electricity customers, to perform a
needs assessment and establish rate assistance and energy
efficiency programs, the bill prohibits irrigation
districts from providing electric transmission or
distribution service to retail customers in another
utility's service territory unless the district certifies
by ordinance that it provides public purpose programs, and
has universal service, consumer protection, and
environmental policies comparable to those of the incumbent
utility provider. The bill also makes various changes to
irrigation district voting requirements.
Comments :
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1. Public purpose programs. AB 1890 (Brulte), Chapter 854,
Statutes of 1996, the landmark electric restructuring
law, requires IOUs and publicly-owned utilities to
impose a surcharge on each electricity customer to fund,
among other programs, needs-based public purpose
programs for low-income electricity customers, including
but not limited to, targeted energy efficiency and rate
discounts. The publicly-owned utilities, unlike the
IOUs, are not required to spend specified amounts on
public purpose programs and have total discretion as to
how these monies are spent.
2. An uneven record for irrigation districts offering
electric service. An overwhelming majority of the
publicly-owned utilities provide substantial funding for
public purpose programs, including low-income services.
There are more than 60 irrigation districts in the
state, but only four of them, Imperial Irrigation
District, Merced Irrigation District, Modesto Irrigation
District, and the Turlock Irrigation District, are
presently providing electrical service. Of the four
irrigation districts providing electrical service, the
Imperial Irrigation District is the only one that has
been willing to establish programs aimed at low-income
customers. The three other irrigation districts
offering electric service have either modest low-income
programs or none at all.
3. Needs assessment, and the implementation of low-income
programs. This bill requires local publicly-owned
utilities, including irrigation districts, which have
not implemented programs for low-income electricity
customers, or completed a needs assessment for those
programs, on or before December 31, 2000, to perform a
needs assessment for those programs. Following the
needs assessment, the local publicly-owned utilities
would be required under this bill to establish and fund
a needs-based low-income rate assistance and energy
efficiency program.
4. Promoting equity in the availability of low-income
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programs. The sponsor of this measure, Latino Issues
Forum, asserts that this bill is needed to ensure that
publicly-owned utilities and irrigation districts devote
adequate resources to low-income programs within their
service area. A recent study by the Rand Corporation
entitled, "The Public Benefits of California's
Investments in Energy Efficiency," indicated that
low-income households derive the greatest benefit from
energy efficiency and reduced energy expenditures. On
average, low-income households spend 8% of their income
on electricity, compared with 2% of a median-income
household. Energy efficiency programs, such as
insulation replacement and weatherstripping, result in
significantly reduced monthly energy costs for
low-income households. Similarly, rate discounts help
ease the burden for low-income families who spend a
disproportionate amount of their monthly income on
energy bills.
5. Electric distribution competition. Section two of this
bill relates to electric distribution competition.
Under this bill, in order to provide electrical service
in the service territory of an IOU or local publicly
owned electric utility, an irrigation district must
certify by ordinance that it provides public purpose
programs, universal service, customer protection, and
environmental policies regarding distribution facilities
that are comparable to those of the incumbent utility
provider. Universal service is defined as "service to
all retail customers who request service within
reasonable physical proximity to the district's
distribution or transmission wires and poles allowing
for line extensions and service, at published tariff
rates and on a just, reasonable, and non-discriminatory
basis, comparable to that provided by the current
distribution service provider." Irrigation districts
would be additionally required to establish
environmental policies to establish environmental
policies to minimize or eliminate the duplication of
electric transmission or distribution policies.
6. Section 2 linked with AB 2638. Section two relating to
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electric distribution competition shall not become
operative if AB 2638 (Calderon) is enacted and becomes
operative. AB 2638, currently in the Senate, permits
irrigation districts to build and operate electric
facilities in the service territory of an IOU only upon
the approval of CPUC or pursuant to a service territory
agreement between an irrigation district and an IOU.
7. Voting criteria. Section three of this bill relates to
irrigation district voting requirements and the
qualifications of directors. Current law provides that
only landowners are eligible to sit on the board of
directors of an irrigation district. This bill removes
that requirement in irrigation districts providing
retail electric service. Section three of this bill
does not affect the 12 irrigation districts whose
governance is specifically set forth in other sections
of Division 11 of the Water Code.
FISCAL EFFECT : Appropriation: No Fiscal Com.: Yes
Local: Yes
1. Any costs to the California Public Utilities Commission
(CPUC) to enforce the requirements of this bill would be
absorbable.
2. Any costs to local utilities to comply with the bill
requirements would be non-reimbursable because the costs
could be offset from the electric rates charged by those
utilities.
SUPPORT : (Per Local Government Committee analysis)
(Unable to reverify at time of writing)
California Journal For Filipino Americans
California Rural Legal Assistance Foundation
Central Valley Opportunity Center
Coalition of California Utility Employees
Community Action Agency of San Mateo County, Inc.
Community Medical Center
Congress of California Seniors
Consumer Federation of California
Finca Management, Inc.
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Foundation For Quality Housing Opportunities,Inc.
The Greenlining Institute
Hermandad Mexicana Nacional -- several members
JERICHO
Latin American Civic Association
Latino Issues Forum
Mexican American Legal Defense and Educational Fund
Pacific Gas and Electric Company
San Fernando Gardens Resident Management Corporation
Sempra Energy
Southern California Gas Workers Council
TELACU
United Farm Workers of America AFL-CIO
Watts/Century Latino Organization
West Angeles Community Development Corporation
OPPOSITION : (Per Local Government Committee analysis)
(Unable to reverify at time of writing)
Agricultural Energy Consumers Association
Alameda Power and Telecom
Association of California Water Agencies
California League of Food Processors
California Municipal Utilities Association
City of Azusa Light and Water Department
Cities of Gridley, Lodi and Lompoc
City of San Bernardino Municipal Water Department
Imperial Irrigation District
Lassen Municipal Utility District
Merced Irrigation District
Modesto Irrigation District
Northern California Power Agency
Roseville Electric
Sacramento Municipal Utility District
Southern California Public Power Authority
Trinity Public Utilities District
Turlock Irrigation District
ASSEMBLY FLOOR :
AYES: Aanestad, Alquist, Aroner, Bates, Bock, Calderon,
Campbell, Cardenas, Cardoza, Cedillo, Corbett, Correa,
Cox, Cunneen, Davis, Dickerson, Ducheny, Dutra,
Firebaugh, Florez, Gallegos, Havice, Honda, Jackson,
Keeley, Knox, Kuehl, Lempert, Longville, Lowenthal,
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Machado, Maddox, Maldonado, Margett, Mazzoni, Migden,
Nakano, Robert Pacheco, Rod Pacheco, Papan, Pescetti,
Reyes, Romero, Runner, Scott, Shelley, Steinberg,
Strom-Martin, Thomson, Torlakson, Villaraigosa, Vincent,
Washington, Wayne, Wesson, Wiggins, Wildman, Wright,
Zettel, Hertzberg
NOES: Ackerman, Ashburn, Baldwin, Battin, Baugh, Brewer,
Briggs, Granlund, House, Kaloogian, Leach, Leonard,
McClintock, Olberg, Oller, Strickland, Thompson
NC:sl 8/30/00 Senate Floor Analyses
SUPPORT/OPPOSITION: SEE ABOVE
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