BILL NUMBER: SB 660 AMENDED
BILL TEXT
AMENDED IN ASSEMBLY SEPTEMBER 4, 2015
AMENDED IN ASSEMBLY AUGUST 19, 2015
AMENDED IN ASSEMBLY AUGUST 18, 2015
AMENDED IN ASSEMBLY JULY 7, 2015
AMENDED IN SENATE MAY 6, 2015
AMENDED IN SENATE APRIL 15, 2015
INTRODUCED BY Senators Leno and Hueso
FEBRUARY 27, 2015
An act to amend Sections 308, 309.6, 1701.1, 1701.2, 1701.3,
1701.4, and 1701.5 of, and to add Sections 305.5, 307.5, 1701.6,
1701.7, and 1701.8 to, the Public Utilities Code, relating to the
Public Utilities Commission.
LEGISLATIVE COUNSEL'S DIGEST
SB 660, as amended, Leno. Public Utilities Commission.
(1) The California Constitution establishes the Public Utilities
Commission, with jurisdiction over all public utilities. The
California Constitution grants the commission certain general powers
over all public utilities, subject to control by the Legislature, and
authorizes the Legislature, unlimited by the other provisions of the
California Constitution, to confer additional authority and
jurisdiction upon the commission that is cognate and germane to the
regulation of public utilities. Existing law requires the Governor to
designate the president of the commission from among its members and
requires the president to direct the executive director, the
attorney, and other staff of the commission, except for the Office of
Ratepayer Advocates.
This bill would authorize the commission to delegate specific
management and internal oversight functions to committees composed of
2 commissioners. The bill would require the commission to appoint a
chief administrative law judge who would be responsible for the
commission's executive and administrative management and
oversight of the administrative law judge division and
would require the chief administrative law judge to organize,
coordinate, supervise, and direct the operations of the
administrative law judge division as directed by the commission,
consistent with commission policies and priorities.
Existing law requires the executive director to keep a full and
true record of all proceedings of the commission.
This bill would delete that requirement and would instead require
the chief administrative law judge to keep a full and true record of
all proceedings of the commission.
(2) Existing law requires the commission, upon initiating a
hearing, to assign one or more commissioners to oversee the case and
an administrative law judge, where appropriate. Existing law requires
the assigned commissioner to prepare and issue, by order or ruling,
a scoping memo that describes the issues to be considered and the
applicable timetable for resolution. Existing law requires the
commission to adopt procedures on the disqualification of
administrative law judges due to bias or prejudice similar to those
of other state agencies and superior courts.
This bill would require the commission to additionally adopt
procedures on disqualification of commissioners due to bias or
prejudice similar to those of other state agencies and superior
courts. For ratesetting or adjudicatory proceedings, the bill would
require a commissioner or an administrative law judge to be
disqualified for bias or prejudice based on specified criteria. The
bill would require that the commission procedures prohibit a
commissioner or administrative law judge from ruling on a motion made
by a party to a proceeding to disqualify the commissioner or
administrative law judge due to bias or prejudice.
(3) The Public Utilities Act requires the commission to determine
whether a proceeding requires a hearing and, if so, to determine
whether the matter requires a quasi-legislative, an adjudication, or
a ratesetting hearing. For these purposes, quasi-legislative cases
are cases that establish policy rulemakings and investigations, which
may establish rules affecting an entire industry, adjudication cases
are enforcement cases and complaints, except those challenging the
reasonableness of any rates or charges, and ratesetting cases are
cases in which rates are established for a specific company,
including general rate cases, performance-based ratemaking, and other
ratesetting mechanisms. The act regulates communications in hearings
before the commission and defines "ex parte communication" to mean
any oral or written communication between a decisionmaker and a
person with an interest in a matter before the commission concerning
substantive, but not procedural, issues that does not occur in a
public hearing, workshop, or other public proceeding, or on the
official record of the proceeding on the matter. Existing law defines
"person with an interest" to mean, among other things, a person with
a financial interest in a matter before the commission, or an agent
or employee of the person with a financial interest, or a person
receiving consideration for representing the person with a financial
interest. Existing law requires the commission, by regulation, to
adopt and publish a definition of the terms "decisionmaker" and
"persons" for those purposes, along with any requirements for written
reporting of ex parte communications and appropriate sanctions for
noncompliance with any rule proscribing ex parte communications. The
act provides that ex parte communications are prohibited in
adjudication cases and are prohibited in ratesetting cases, with
certain exceptions. The act requires that ex parte communications be
permitted in quasi-legislative cases, without any restrictions. The
commission's Rules of Practice and Procedure define a "decisionmaker"
as any commissioner, the Chief Administrative Law Judge, any
Assistant Chief Administrative Law Judge, the assigned administrative
law judge, or the Law and Motion Administrative Law Judge. The Rules
of Practice and Procedure provide that communications with a
commissioner's personal advisors are subject to all of the
restrictions on, and reporting requirements applicable to, ex parte
communications, except that oral communications with an advisor in
ratesetting proceedings are permitted without the restrictions.
This bill would require that the commission determine whether
every proceeding, not just those requiring a hearing, is a
quasi-legislative, adjudication, or ratesetting proceeding. The bill
would delete the provision that an ex parte communication concerns a
substantive, but not a procedural matter, and instead would provide
that an ex parte communication concerns any matter that the
commission has not specified in its Rules of Practice and Procedure
as being a procedural matter and that does not occur in a public
hearing, workshop, or other public proceeding, or on the official
record of the proceeding on the matter. The bill would prohibit the
commission from considering as a procedural matter communications
between an interested person and a decisionmaker regarding which
commissioner or administrative law judge may be assigned to a matter
before the commission. The bill would define a person involved in
issuing credit ratings or advising entities or persons who may invest
in the shares or operations of any party to a proceeding as an
interested person. The bill would require that the commission, by
rule, adopt and publish a definition of decisionmakers, that would be
required to include certain individuals in the commission. The bill
would require the commission to establish and maintain a
communications log summarizing all oral or written ex parte
communications that occur between an interested person and
the commission, the attorney for the commission, the executive
director of the commission, the personal staff of a commissioner, if
the staff is acting in a policy or legal advisory capacity, the chief
administrative law judge, or the administrative law judge assigned
to the proceeding. any decisionmaker. The bill
would require the commission to post the communications log on its
Internet Web site.
This bill would require that a decisionmaker, in an adjudication
or ratesetting case, who makes or receives a prohibited ex parte
communication, or who receives an ex parte communication that was not
timely reported, to disclose certain information regarding the
communication in the record of the proceeding before the commission
takes a vote on the matter. If a prohibited ex parte communication is
not disclosed until after the commission has issued a decision on
the matter to which the communication pertained, a party not
participating in the communication would be authorized to file a
petition to rescind or modify the decision. The bill would require
the commission to render decisions based upon the record in a case
and would provide that an ex parte communication not be part of the
record of the proceeding.
This bill would provide that ex parte communications are permitted
in quasi-legislative proceedings, but would require that they be
reported within 3 working days in the communications log maintained
by the commission.
This bill would require the commission to additionally prohibit
communications concerning procedural issues in adjudication cases
between parties or persons with an interest and decisionmakers,
except for the assigned administrative law judge.
Under existing law, the exceptions to the prohibition upon ex
parte communications in ratesetting proceedings authorize a
commissioner to permit oral ex parte communications if all interested
parties are invited and given not less than 3 days' notice. If an ex
parte communication meeting is granted to any party, it is required
that all other parties also be granted individual ex parte meetings
of a substantially equal period of time and that all parties be sent
a notice of that authorization at the time the request is granted, at
least 3 days prior to the meeting. The exceptions authorize a
commissioner to permit written ex parte communications by any party
provided that copies of the communication are transmitted to all
parties.
This bill would delete the requirement that if an ex parte
communication meeting is granted to any party in a ratesetting
proceeding, that all other parties also be granted individual ex
parte meetings of a substantially equal period of time and that all
parties be sent a notice of that authorization at the time the
request is granted, at least 3 days prior to the meeting. The bill
would prohibit oral communications concerning procedural matters in
ratesetting cases between parties or persons with an interest and
decisionmakers other than the assigned administrative law judge,
except that a commissioner would be authorized to permit an oral
communication relative to procedural matters if all interested
parties are invited and given not less than 3 days' notice. The bill
would prohibit written ex parte communications concerning procedural
matters in ratesetting cases between parties or persons with an
interest and decisionmakers other than the assigned administrative
law judge, except that a commissioner would be authorized to permit a
written communication relative to procedural issues by any party
provided that copies of the communication are transmitted to all
parties on the same day.
This bill would expressly make the prohibitions upon ex parte
communications that relate to adjudicatory or ratesetting proceedings
applicable to ex parte communications that occur at conferences, as
defined. The bill would also make the requirements that pertain to ex
parte communications that relate to quasi-legislative proceedings
applicable to ex parte communications that occur at conferences.
This bill would authorize the commission to impose civil
sanctions, including civil penalties, on any entity or person, other
than a decisionmaker or employee of the commission, that violates ex
parte communication requirements. The bill would authorize the
Attorney General to bring an enforcement action in the Superior Court
of the City and County of San Francisco against a decisionmaker or
employee of the commission who violates the ex parte communication
requirements.
This bill would incorporate additional changes in Section 308 of
the Public Utilities Code, proposed by SB 48, to be operative only if
SB 48 and this bill are both chaptered and become effective on or
before January 1, 2016, and this bill is chaptered last.
Under existing law, a violation of the Public Utilities Act or any
order, decision, rule, direction, demand, or requirement of the
commission is a crime.
Because the provisions of this bill would be a part of the act and
because a violation of an order or decision of the commission
implementing its requirements would be a crime, the bill would impose
a state-mandated local program by expanding the application of a
crime.
The California Constitution requires the state to reimburse local
agencies and school districts for certain costs mandated by the
state. Statutory provisions establish procedures for making that
reimbursement.
This bill would provide that no reimbursement is required by this
act for a specified reason.
Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: yes.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Section 305.5 is added to the Public Utilities Code, to
read:
305.5. (a) The commission
may delegate specific management and internal oversight functions to
committees composed of two commissioners. Committees shall meet
regularly with staff and shall report to the commission for
additional guidance or approval of decisions pertaining to the
operations of the commission.
(b) The commission shall vote in an open meeting on the assignment
or reassignment of any proceeding to one or more commissioners.
SEC. 2. Section 307.5 is added to the Public Utilities Code, to
read:
307.5. (a) The commission shall appoint a chief administrative
law judge, who shall hold office at the pleasure of the commission.
(b) The chief administrative law judge shall be responsible for
the commission's executive and administrative management and
oversight of the administrative law judge division and
shall organize, coordinate, supervise, and direct the operations of
the division as directed by the commission, consistent with
commission policies and priorities.
(c) The chief administrative law judge shall keep a full and true
record of all proceedings of the commission.
SEC. 3. Section 308 of the Public Utilities Code is amended to
read:
308. (a) The commission shall appoint an executive director, who
shall hold office during its pleasure. The executive director shall
be responsible for the commission's executive and administrative
duties and shall organize, coordinate, supervise, and direct the
operations and affairs of the commission and expedite all matters
within the commission's jurisdiction.
(b) The executive director shall issue all necessary process,
writs, warrants, and notices, and perform any other duties as the
commission prescribes. The president or, by vote, the commission may
authorize the executive director to dismiss complaints or
applications when all parties are in agreement thereto, in accordance
with rules that the commission may prescribe.
(c) The commission may appoint assistant executive directors who
may serve warrants and other process in any county or city and county
of this state.
SEC. 3.5. Section 308 of the Public
Utilities Code is amended to read:
308. (a) The commission shall appoint an executive director, who
shall hold office during its pleasure. The executive director shall
be responsible for the commission's executive and administrative
duties and shall organize, coordinate, supervise, and direct the
operations and affairs of the commission and expedite all matters
within the commission's jurisdiction.
(b) The executive director shall keep a full and true
record of all proceedings of the commission, issue all
necessary process, writs, warrants, and notices, and perform
such any other duties as the
president, or vote of the commission, prescribes. The president
the commission prescribes. The commission may
authorize the executive director to dismiss complaints or
applications when all parties are in agreement thereto, in accordance
with rules that the commission may prescribe.
(c) The commission may appoint assistant executive directors who
may serve warrants and other process in any county or city and county
of this state.
SEC. 4. Section 309.6 of the Public Utilities Code is amended to
read:
309.6. (a) The commission shall adopt procedures on the
disqualification of commissioners and administrative law judges due
to bias or prejudice similar to those of other state agencies and
superior courts.
(b) (1) For ratesetting and adjudicatory proceedings, a
commissioner or administrative law judge shall be disqualified for
bias or prejudice based on any of the following:
(A) Actions taken during the proceeding.
(B) Private communications before the commencement of the
proceeding to influence the request for relief sought by any party to
the proceeding.
(C) Actions demonstrating any commitment to provide relief to a
party.
(2) Past work experience by the commissioner or administrative law
judge shall not be a sufficient basis for demonstrating bias or
prejudice pursuant to paragraph (1).
(c) The commission procedures shall prohibit a commissioner or
administrative law judge from ruling on a motion made by a party to a
proceeding to disqualify the commissioner or administrative law
judge due to bias or prejudice.
(d) The commission shall develop the procedures with the
opportunity for public review and comment.
SEC. 5. Section 1701.1 of the Public Utilities Code is amended to
read:
1701.1. (a) The commission, consistent with due process,
public policy, and statutory requirements, shall determine whether a
proceeding requires a hearing. The commission shall
determine whether each proceeding is a quasi-legislative, an
adjudication, or a ratesetting proceeding.
proceeding and, consistent with due process, public policy, and
statutory requirements, determine whether the proceeding
requires a hearing. The commission's decision as to the nature
of the proceeding shall be subject to a request for rehearing within
10 days of the date of that decision. If that decision is not
appealed to the commission within that time period it shall not be
subsequently subject to judicial review. Only those parties who have
requested a rehearing within that time period shall subsequently have
standing for judicial review and that review shall only be available
at the conclusion of the proceeding. The commission shall render its
decision regarding the rehearing within 30 days. The commission
shall establish rules regarding ex parte communication on case
categorization issues.
(b) The commission upon initiating an adjudication
hearing proceeding or ratesetting
hearing proceeding shall assign one or more
commissioners to oversee the case and an administrative law judge
where appropriate. The assigned commissioner shall schedule a
prehearing conference. The assigned commissioner shall prepare and
issue by order or ruling a scoping memo that describes the issues to
be considered and the applicable timetable for resolution. The
administrative law judge shall either preside and conduct, or assist
the assigned commissioner or commissioners in presiding and
conducting, any evidentiary or adjudication hearing that may be
required.
(c) The commission upon initiating a quasi-legislative
hearing proceeding shall assign one or more
commissioners to oversee the case and an administrative law
judge judge, where appropriate, who may be
assisted by a technical advisory staff member in conducting the
proceeding. The assigned commissioner shall prepare and issue by
order or ruling a scoping memo that describes the issues to be
considered and the applicable timetable for resolution.
(d) (1) Quasi-legislative cases, for purposes of this article, are
cases that establish policy, including, but not limited to,
rulemakings and investigations which may establish rules affecting an
entire industry.
(2) Adjudication cases, for purposes of this article, are
enforcement cases and complaints except those challenging the
reasonableness of any rates or charges as specified in Section 1702.
(3) Ratesetting cases, for purposes of this article, are cases in
which rates are established for a specific company, including, but
not limited to, general rate cases, performance-based ratemaking, and
other ratesetting mechanisms.
(4) "En banc hearing," "All party
conference," for purposes of this article, is a public hearing
held on the record before a quorum of commissioners at which parties
to a proceeding shall have the right to participate and let their
views be heard regarding any factual, legal, or policy issue in the
proceeding.
(e) (1) (A) "Ex parte communication," for purposes of this
article, means any oral or written communication between a
decisionmaker and an interested person concerning any matter before
the commission that the commission has not specified in its Rules of
Practice and Procedure as being a procedural matter and that does not
occur in a public hearing, workshop, or other public proceeding, or
on the official record of the proceeding on the matter. The
commission shall specify in its Rules of Practice and Procedure,
enacted by rulemaking, the types of issues considered procedural
matters under this article. Any communication between an interested
person and a decisionmaker regarding which commissioner or
administrative law judge may be assigned to a matter before the
commission shall not be deemed to be a procedural matter and shall be
an ex parte communication subject to this article.
(B) "Interested person," for purposes of this article, means any
of the following:
(i) Any applicant, an agent or an employee of the applicant, or a
person receiving consideration for representing the applicant, or a
party to the proceeding on any matter before the commission.
(ii) Any person with a financial interest, as described in Article
1 (commencing with Section 87100) of Chapter 7 of Title 9 of the
Government Code, in a matter before the commission, or an agent or
employee of the person with a financial interest, or a person
receiving consideration for representing the person with a financial
interest. A person involved in issuing credit ratings or advising
entities or persons who may invest in the shares or operations of any
party to a proceeding is a person with a financial interest.
(iii) A representative acting on behalf of any civic,
environmental, neighborhood, business, labor, trade, or similar
organization who intends to influence the decision of a commission
member on a matter before the commission.
(iv) Other categories of individuals deemed by the commission, by
rule, to be an interested person.
(2) The commission shall by rule adopt and publish a definition of
decisionmakers and interested persons for purposes of this
section, article, along with any requirements
for written reporting of ex parte communications and appropriate
sanctions for noncompliance with any rule proscribing ex parte
communications. The definition of decisionmakers shall include, but
is not limited to, each commissioner; the attorney for the
commission; the executive director of the commission; the personal
staff of a commissioner if the staff is acting in a policy or legal
advisory capacity; the chief administrative law judge of the
commission; and the administrative law judge assigned to the
proceeding.
(3) For adjudication and ratesetting cases, the rules shall
provide that ex parte communications shall be prohibited, as required
by this article. The rules shall provide that if an ex parte
communication occurs that is prohibited by this article, whether
initiated by a decisionmaker or an interested person, all of the
following shall be required:
(A) The interested person shall report the communication within
one working day of the communication by filing a notice with the
commission that includes all the following:
(i) The date, time, and location of the communication, whether the
communication was oral, or written, or a combination of both, and
the communication medium utilized.
(ii) The identity of the decisionmaker, the identity of the person
initiating the communication, and any other persons present.
(iii) A complete and comprehensive description of the interested
person's and the decisionmaker's communication and its content.
(iv) A copy of any written material or text used during the
communication.
(B) Any decisionmaker who participated in the communication shall
comply with both of the following:
(i) If the interested person who participated in the communication
has not timely submitted the notice required by subparagraph (A),
the decisionmaker shall promptly prepare and file a notice that
includes the information required by subparagraph (A).
(ii) If the interested person has timely submitted the notice
required by subparagraph (A), the decisionmaker shall either promptly
file a notice affirming the factual representations made by the
interested person in the notice or promptly file a notice correcting
or supplementing the factual representations made by the interested
person.
(4) The commission shall not take any vote on a matter where a
notice has been filed pursuant to subparagraph (A) or (B) of
paragraph (3) until all parties to the proceeding have been provided
a reasonable opportunity to respond to the communication.
(5) If a prohibited ex parte communication is not disclosed as
required by this subdivision until after the commission has issued a
decision on the matter to which the prohibited communication
pertained, a party not participating in the communication may file a
petition to rescind or modify the decision. The party may seek a
finding that the ex parte communication was prohibited and
significantly influenced the decision's process or outcome as part of
any petition to rescind or modify the decision. The commission shall
process the petition in accordance with the commission's procedures
for petitions for modification and shall issue a decision on the
petition no later than 180 days after the filing of the petition.
(6) (A) Ex parte communications that occur at conferences that are
related to an adjudication or ratesetting proceeding shall be
prohibited consistent with the ex parte communications requirements
of this article.
(B) Ex parte communications that occur at conferences and that are
related to a quasi-legislative proceeding shall be governed by the
ex parte communication disclosure requirements developed by the
commission.
(C) For purposes of this section, "ex parte communications that
occur at conferences" includes, but is not limited to, communications
in a private setting or during meals, entertainment events, and
tours, and informal discussions among conference attendees.
(7) The commission shall render its decisions based on the
evidence in the record. Ex parte communications shall not be a part
of the record of the proceedings.
(f) The commission may meet in a closed session to discuss
administrative matters not related to a proceeding before
the commission, so long as no collective consensus is
reached or vote taken on any matter requiring a vote of the
commissioners. The commission shall, by rule, adopt and publish
a definition of "administrative matters" for purposes of this
section.
SEC. 6. Section 1701.2 of the Public Utilities Code is amended to
read:
1701.2. If the commission pursuant to Section 1701.1 has
determined that an adjudication case requires a hearing, the
procedures prescribed by this section shall be applicable.
(a) The assigned commissioner or the assigned administrative law
judge shall hear the case in the manner described in the scoping
memo. The scoping memo shall designate whether the assigned
commissioner or the assigned administrative law judge shall preside
in the case.
(b) The commission shall provide by rule for peremptory challenges
and challenges for cause of the administrative law judge. Challenges
for cause shall include, but not be limited to, financial interests
and prejudice. The rule shall provide that all parties are entitled
to one peremptory challenge of the assignment of the administrative
law judge in all cases. All parties are entitled to unlimited
peremptory challenges in any case in which the administrative law
judge has within the previous 12 months served in any capacity in an
advocacy position at the commission, been employed by a regulated
public utility, or has represented a party or has been an interested
person in the case.
(c) The assigned commissioner or the administrative law judge
shall prepare and file a decision setting forth recommendations,
findings, and conclusions. The decision shall be filed with the
commission and served upon all parties to the action or proceeding
without undue delay, not later than 60 days after the matter has been
submitted for decision. The decision of the assigned commissioner or
the administrative law judge shall become the decision of the
commission if no further action is taken within 30 days. Any party
may appeal the decision to the commission, provided that the appeal
is made within 30 days of the issuance of the decision. The
commission may itself initiate a review of the proposed decision on
any grounds.
(d) The Upon request made by a majority of
parties, the commission shall hold an en banc hearing
all-party conference before a quorum of
commissioners, in all adjudication cases in which an appeal has been
filed, at which all parties have an opportunity to be heard, unless
all parties waive this requirement and a majority of commissioners
concur with that waiver. The commission shall adopt rules for
implementation of this requirement, which shall provide for the
broadest participation by parties to the proceeding that the
commission can reasonably accommodate, consistent with the
commissioners' other duties and responsibilities.
(e) The commission's decision shall be supported by findings of
fact on all issues material to the decision, and the findings of fact
shall be based on the record developed by the assigned commissioner
or the administrative law judge. A decision different from that of
the assigned commissioner or the administrative law judge shall be
accompanied by a written explanation of each of the changes made to
the decision.
(f) Notwithstanding Section 307, an officer, employee, or agent of
the commission that is personally involved in the prosecution or in
the supervision of the prosecution of an adjudication case before the
commission shall not participate in the decision of the case, or in
the decision of any factually related adjudicatory proceeding,
including participation in or advising the commission as to findings
of fact, conclusions of law, or orders. An officer, employee, or
agent of the commission that is personally involved in the
prosecution or in the supervision of the prosecution of an
adjudication case may participate in reaching a settlement of the
case, but shall not participate in the decision of the commission to
accept or reject the settlement, except as a witness or counsel in an
open hearing or a hearing closed pursuant to subdivision (h). The
Legislature finds that the commission performs both prosecutorial and
adjudicatory functions in an adjudication case and declares its
intent that an officer, employee, or agent of the commission,
including its attorneys, may perform only one of those functions in
any adjudication case or factually related adjudicatory proceeding.
(g) (1) Ex parte communications shall be prohibited in
adjudication cases.
(2) Any oral or written communications concerning procedural
matters in adjudication cases between interested persons and
decisionmakers, except the assigned administrative law judge, shall
be prohibited.
(h) Notwithstanding any other law, the commission may meet in a
closed hearing to consider the decision that is being appealed. The
vote on the appeal shall be in a public meeting and shall be
accompanied with an explanation of the appeal decision.
(i) Adjudication cases shall be resolved within 12 months of
initiation unless the commission makes findings why that deadline
cannot be met and issues an order extending that deadline. In the
event that a rehearing of an adjudication case is granted, the
parties shall have an opportunity for final oral argument.
(j) (1) The commission may determine that the respondent lacks, or
may lack, the ability to pay potential penalties or fines or to pay
restitution that may be ordered by the commission.
(2) If the commission determines that a respondent lacks, or may
lack, the ability to pay, the commission may order the respondent to
demonstrate, to the satisfaction of the commission, sufficient
ability to pay potential penalties, fines, or restitution that may be
ordered by the commission. The respondent shall demonstrate the
ability to pay, or make other financial arrangements satisfactory to
the commission, within seven days of the commission commencing an
adjudication case. The commission may delegate to the attorney to the
commission the determination of whether a sufficient showing has
been made by the respondent of an ability to pay.
(3) Within seven days of the commission's determination of the
respondent's ability to pay potential penalties, fines, or
restitution, the respondent shall be entitled to an impartial review
by an administrative law judge of the sufficiency of the showing made
by the respondent of the respondent's ability to pay. The review by
an administrative law judge of the ability of the respondent to pay
shall become part of the record of the adjudication and is subject to
the commission's consideration in its order resolving the
adjudication case. The administrative law judge may enter temporary
orders modifying any financial requirement made of the respondent
pending the review by the administrative law judge.
(4) A respondent that is a public utility regulated under a rate
of return or rate of margin regulatory structure or that has gross
annual revenues of more than one hundred million dollars
($100,000,000) generated within California is presumed to be able to
pay potential penalties or fines or to pay restitution that may be
ordered by the commission, and, therefore, paragraphs (1) to (3),
inclusive, do not apply to that respondent.
SEC. 7. Section 1701.3 of the Public Utilities Code is amended to
read:
1701.3. If the commission pursuant to Section 1701.1 has
determined that a ratesetting case requires a hearing, the procedures
prescribed by this section shall be applicable.
(a) The assigned commissioner shall determine prior to the first
hearing whether the commissioner or the assigned administrative law
judge shall be designated as the principal hearing officer. The
principal hearing officer shall be present for more than one-half of
the hearing days. The decision of the principal hearing officer shall
be the proposed decision.
(b) An alternate decision may be issued by the assigned
commissioner or the assigned administrative law judge who is not the
principal hearing officer. Any alternate decision may be filed with
the commission and served upon all parties to the proceeding any time
prior to issuance of a final decision by the commission, consistent
with the requirements of Section 311.
(c) The commission shall establish a procedure for any party to
request the presence of a commissioner at a hearing. The assigned
commissioner shall be present at the closing arguments of the case.
(d) The principal hearing officer shall present the proposed
decision to the full commission in a public meeting. The alternate
decision, if any, shall also be presented to the full commission at
that public meeting.
(e) The presentation to the full commission shall contain a record
of the number of days of the hearing, the number of days that each
commissioner was present, and whether the decision was completed on
time.
(f) The commission shall provide by regulation for peremptory
challenges and challenges for cause of the administrative law judge.
Challenges for cause shall include, but not be limited to, financial
interests and prejudice. All parties shall be entitled to unlimited
peremptory challenges in any case in which the administrative law
judge has within the previous 12 months served in any capacity in an
advocacy position at the commission, been employed by a regulated
public utility, or has represented a party or has been an interested
person in the case.
(g) (1) Ex parte communications are prohibited in ratesetting
cases.
(A) Oral communications may be permitted by a decisionmaker if all
parties are invited and given not less than three working days'
notice.
(B) Written ex parte communications by any interested person may
be permitted provided that copies of the communication are
transmitted to all parties on the same day as the original
communication. Written ex parte communications shall not be part of
the record of the proceeding.
(C) The commission may establish a period during which no oral or
written all-party communications may be permitted and the commission
may meet in closed session during that period, which shall not in any
circumstance exceed 14 days. If the commission holds the decision,
it may permit all-party communications during the first half of the
interval between the hold date and the date that the decision is
calendared for final decision. The commission may meet in closed
session for the second half of that interval.
(2) Oral communications concerning a procedural matter in
ratesetting cases between interested persons and decisionmakers,
except the assigned administrative law judge, are prohibited, except
that an oral communication may be permitted at any time by any
decisionmaker if all parties are invited and given not less than
three working days' notice.
(3) Written communications concerning a procedural matter in
ratesetting cases between interested persons and decisionmakers,
except the assigned administrative law judge, are prohibited, except
that a decisionmaker may permit a written communication by any party
if copies of the communication are transmitted to all parties on the
same day.
(h) The Upon request made by a majority of
parties, the commission shall hold an en banc hearing
all-party conference before a quorum of
commissioners, after the proposed decision is issued in all contested
ratesetting cases, at which all parties have an opportunity to be
heard, unless all parties waive this requirement and a majority of
commissioners concur with that waiver. The commission shall adopt
rules for implementation of this requirement, which shall provide for
the broadest participation by parties to the proceeding that the
commission can reasonably accommodate, consistent with the
commissioners' other duties and responsibilities.
(i) The commission may, in issuing its decision, adopt, modify, or
set aside the proposed decision or any part of the decision based on
evidence in the record. The final decision of the commission shall
be issued not later than 60 days after the issuance of the proposed
decision. Under extraordinary circumstances the commission may extend
this date for a reasonable period. The 60-day period shall be
extended for 30 days if any alternate decision is proposed pursuant
to Section 311.
SEC. 8. Section 1701.4 of the Public Utilities Code is amended
to read:
1701.4. If the commission pursuant to Section 1701.1 has
determined that a quasi-legislative case requires a hearing, the
procedures prescribed by this section shall be applicable.
(a) The assigned administrative law judge and any assigned
technical advisory staff shall act as an assistant to the
assigned commissioner in quasi-legislative cases. The assigned
commissioner shall prepare the proposed rule or order with the
assistance of the administrative law judge.
judge and any assigned technical advisory staff. The assigned
commissioner shall present the proposed rule or order to the full
commission in a public meeting. The report shall include the number
of days of hearing and the number of days that the commissioner was
present.
(b) Ex parte communications shall be permitted. Any ex parte
communication shall be reported in compliance with Section 1701.6. No
reporting shall be required for written ex parte communications that
are transmitted to all parties on the same day as the original
communication.
(c) The Upon request made by a majority of
parties, the commission shall hold an en banc hearing
all-party conference before a quorum of
commissioners, after the proposed decision is issued in all contested
quasi-legislative cases, unless all parties waive this requirement
and a majority of commissioners concur with that waiver. The
commission shall adopt rules for implementation of this requirement,
which shall provide for the broadest participation by parties to the
proceeding that the commission can reasonably accommodate, consistent
with the commissioners' other duties and responsibilities.
(d) The commission may, in issuing its rule or order, adopt,
modify, or set aside the proposed decision or any part of the rule or
order. The final rule or order of the commission shall be issued not
later than 60 days after the issuance of the proposed rule or order.
Under extraordinary circumstances the commission may extend this
date for a reasonable period. The 60-day period shall be extended for
30 days if any alternate rule or order is proposed pursuant to
Section 311.
SEC. 9. Section 1701.5 of the Public Utilities Code is amended to
read:
1701.5. (a) Except as specified in subdivision (b), in a
ratesetting or quasi-legislative case, the commission shall resolve
the issues raised in the scoping memo within 18 months of the date
the proceeding is initiated, unless the commission makes a written
determination that the deadline cannot be met, including findings as
to the reason, and issues an order extending the deadline.
No single order may extend the deadline for more than 60 days.
(b) Notwithstanding subdivision (a), the commission may specify in
a scoping memo a resolution date later than 18 months from the date
the proceeding is initiated, if that scoping memo includes specific
reasons for the necessity of a later date and the commissioner
assigned to the case approves the date.
SEC. 10. Section 1701.6 is added to the Public Utilities Code, to
read:
1701.6. (a) The commission shall establish and maintain a
communications log summarizing all oral or
and written ex parte communications, as defined in Section
1701.1.
(b) The communications log shall include a summary of all oral and
written communications that meet the definition of an ex parte
communication that occur between an interested person and any
of the following officials: decisionmaker.
(1) A commissioner.
(2) The attorney for the commission.
(3) The executive director of the commission.
(4) The personal staff of a commissioner, if the staff is acting
in a policy or legal advisory capacity.
(5) The chief administrative law judge of the commission.
(6) The administrative law judge assigned to the proceeding.
(c) Each record of a communication in the communication log shall
include the date of each communication, the persons involved in the
communication, the topics discussed, and, to the
extent known, any proceedings that were the subject of each
communication. Ex parte communications in the summary log shall be
reported no later than three working days after the communication.
(d) The communication log shall be made available to the public on
the commission's Internet Web site not later than July 1, 2016.
SEC. 11. Section 1701.7 is added to the Public Utilities Code, to
read:
1701.7. (a) In addition to any penalty, fine, or other punishment
applicable pursuant to Article 11 (commencing with Section 2100),
the commission may assess civil sanctions upon any entity or person,
other than a decisionmaker or employee of the commission, who
violates, fails to comply with, or procures, aids, or abets any
violation of, the ex parte communication requirements of this article
or those adopted by the commission pursuant to this article. The
civil sanctions may include civil penalties, adverse consequences in
commission proceedings, or other appropriate commission orders
directed at the entity, person, or both the entity and person,
committing the violation.
(b) (1) Except as provided in paragraph (2), a civil penalty
assessed shall not exceed fifty thousand dollars ($50,000) per
violation. Each day of a continuing violation is a separate
violation. If the violation consists of engaging in a communication
that is prohibited by the ex parte communication requirements, each
day that the violation is not disclosed to the commission and to
parties of record in the formal proceeding in which the communication
occurred shall constitute a separate violation.
(2) If the entity or person may obtain, by violating the ex parte
communication requirements, financial benefits that exceed the
maximum amount of civil penalty allowable pursuant to paragraph (1),
the commission may impose a civil penalty up to the amount of those
financial benefits.
(c) Civil penalties assessed pursuant to subdivision (b) upon
entities whose rates are determined by the commission shall be in the
form of credits to the customers of that entity. Civil penalties
collected from other entities shall be deposited in the General Fund.
(d) In determining the appropriate civil sanctions, the commission
shall consider the following factors:
(1) The severity of the violation.
(2) The conduct of the entity or person, including the level of
experience of the entity or person in participating in commission
proceedings and whether the entity or person knowingly violated the
ex parte communication requirements.
(3) The financial resources of the entity or person.
(4) The totality of the circumstances in furtherance of the public
interest.
SEC. 12. Section 1701.8 is added to the Public Utilities Code, to
read:
1701.8. (a) The Attorney General may bring an enforcement action
in the Superior Court for the City and County of San Francisco
against a decisionmaker or employee of the commission who violates,
fails to comply with, or procures, aids, or abets any violation of,
the ex parte communication requirements in this article or those
adopted by the commission pursuant to this article. The court shall
expedite its review of the action to provide effective and timely
relief.
(b) Notwithstanding Section 1759, in an enforcement action brought
pursuant to this section, the court may grant appropriate relief,
including disqualification of the decisionmaker from one or more
proceedings and civil penalties as provided in Section 2111.
(c) In determining the appropriate relief, the court may consider
the following factors:
(1) The severity of the violation.
(2) The conduct of the decisionmaker or employee, including
whether the decisionmaker or employee knowingly violated the ex parte
communication requirements.
(3) The financial resources of the decisionmaker or employee.
(4) The totality of the circumstances in furtherance of the public
interest.
(d) The Attorney General may compromise the enforcement action
subject to approval by the court.
(e) Civil penalties collected pursuant to this section shall be
deposited into the Litigation Deposits Fund established pursuant to
Article 9 (commencing with Section 16425) of Chapter 2 of Part 2 of
Division 4 of Title 2 of the Government Code.
SEC. 13. Section 3.5 of this bill incorporates
amendments to Section 308 of the Public Utilities Code proposed by
both this bill and Senate Bill 48. It shall only become operative if
(1) both bills are enacted and become effective on or before January
1, 2016, (2) each bill amends Section 308 of the Public Utilities
Code, and (3) this bill is enacted after Senate Bill 48, in which
case Section 3 of this bill shall not become operative.
SEC. 13. SEC. 14. No reimbursement
is required by this act pursuant to Section 6 of Article XIII B of
the California Constitution because the only costs that may be
incurred by a local agency or school district will be incurred
because this act creates a new crime or infraction, eliminates a
crime or infraction, or changes the penalty for a crime or
infraction, within the meaning of Section 17556 of the Government
Code, or changes the definition of a crime within the meaning of
Section 6 of Article XIII B of the California Constitution.