GOVERNOR BROWN, LEGISLATORS ANNOUNCE SWEEPING REFORMS TO CALIFORNIA PUBLIC UTILITIES COMMISSION

SACRAMENTO - Governor Edmund G. Brown Jr., Assemblymember Mike Gatto (D-Glendale) and Senators Jerry Hill (D-San Mateo) and Mark Leno (D-San Francisco) today announced a sweeping package of reforms to bolster governance, accountability, transparency and oversight of the California Public Utilities Commission (CPUC).

"These reforms will change how this commission does business," said Governor Brown. "Public access to meetings and records will be expanded, new safety and oversight positions will be created and ex parte communication rules will be strengthened."

"These reforms mark a new beginning for the CPUC. The commission will become transparent and accountable to Californians and focused on the safety of our communities," said Assemblymember Gatto, chair of the Assembly Utilities and Commerce Committee. "I want to thank my colleagues in the Legislature and Governor Brown for their support of these key reforms."

"It's been a long road, and we still have much work to do if we are to build the CPUC that the state deserves," said Senator Hill, whose district includes the City of San Bruno. "Today we take a strong step forward with principles that underscore our shared commitment to an organization that will better serve Californians, ensure their safety and merit their trust."

"The principles are a blueprint for a CPUC that is focused, efficient, working in the public interest, and most notably, transparent and accountable," said Senator Leno. "The changes agreed to by the Commission and the Governor in SB 215 apply enhanced ex parte communication rules targeting the abuses of the past and ensure independent prosecution and stiff penalties for those who would violate the public trust. I offer my thanks to Governor Brown, the Commission, my joint author Senator Hueso, all my legislative colleagues and The Utility Reform Network for their commitment to reforming our Public Utilities Commission."

The Governor's Office will work closely with the Legislature and impacted entities in the administration to move forward with these reforms in the months ahead. Complete details of the reform package are below.

Principles for Reform: Governance, Accountability, Transparency and Oversight of the California Public Utilities Commission

Governance
Increasing the CPUC's focus and expertise by relocating responsibilities and making logistical changes that improve the commission's ability to function.

--Transfer the implementation and enforcement of the following CPUC transportation responsibilities to departments within the California State Transportation Agency (e.g., California Department of Motor Vehicles primarily for licensing, registration, evidence of insurance and select investigations and the California Highway Patrol primarily for enforcement and select investigations) through the Governor's Reorganization Plan process:

Passenger Stage Corporations

Charter-Party Carriers (including Transportation Network Companies)

Household Goods Carriers

Other carriers subject to CPUC registration requirements (for-hire vessel carriers, commercial air operators, private carriers of passengers and interstate carriers)

--Assess State Telecommunications governance by January 1, 2018.

--Establish cross-agency secondments (for example, with the Division of Oil, Gas, and Geothermal Resources, California Air Resources Board, etc.) to foster coordinated actions and exchange of information and facilitate cultural change.

--Work with state colleges and universities to develop and offer curricula specific to the regulation and oversight of utilities.

--Authorize the CPUC to hire and locate employees in San Francisco, Los Angeles and Sacramento.

--Require CPUC voting meetings to be held in various regions of the state.

--Provide statutory authority to consider outside reports from state, federal and academic sources.

--Allow a commissioner to issue an Alternate Proposed Decision (APD) at any time before the Commission votes (current law requires issuance of the APD simultaneous to the issuance of the Presiding Administrative Law Judges issuance of their Proposed Decision.).

Accountability
Enacting reforms to make it easier for the public and watchdog groups to participate in CPUC proceedings.

--Prohibit former regulated utility executives from serving on the Commission for 2 years.

--Allow any California agency to participate in CPUC proceedings without official party status.

--Authorize the California Attorney General to bring an enforcement action in superior court against a decisionmaker or employee of the commission who violates the ex parte communication requirements.

Transparency
Reforming the ex parte rules to establish a more ethical environment that is fair to all parties, while providing flexibility for entities to contact their appointed officials.

--Ex Parte:

Adjudicatory proceedings: maintain the current prohibition on ex parte communications.

Quasi-legislative proceedings: allow commissioners to meet freely, particularly with members of the public, to gain perspective and become more educated on the subject area.

Ratesetting proceedings: require commissioners and interested persons to disclose and promptly log and post the content of ex parte communications online. Failure to timely report shall result in penalties enforced by either the CPUC or the California Attorney General.

The CPUC may apply additional limits on ex parte communication in ratesetting or quasi-legislative proceedings as circumstances may warrant.

--Allow intervenor compensation for substantial contribution including when a party does not participate in a settlement.

--Subject the CPUC to the judicial review provisions of the California Public Records Act and revisions to improve the CPUC public records and confidentiality statute (§ 583) to retain confidentiality with a more timely release of public information.

--Require documents distributed to service lists be docketed.

--Require transcripts to be made publicly available promptly.

--Require representatives of organizations that lobby the CPUC to register, much like the rules followed in the Legislature.

--Allow commissioners to deliberate on ratesetting proceedings if no hearing has been held. Current law allows commissioners to meet and deliberate only when a hearing is required for resolution of the proceeding.

--Make administrative record more open in quasi-legislative proceeding by not applying the formal rules of evidence.

--Allow commissioners to discuss administrative and managerial issues in closed meetings.

--Enter public comments into the record and develop an e-comment system to make commenting more accessible.

--Establish thresholds for the reasonable and timely resolution of proceedings with enhanced CPUC authority to conclude proceedings in cases exceeding those thresholds.

--Ensure the CPUC appoints all senior executive staff who report directly to the CPUC, including the Executive Director, the General Counsel, the Internal Auditor and the Chief Administrative Law Judge.

Oversight and Safety
Enacting sweeping ethics reforms, which have been elusive or are completely unprecedented.

--Create an Ethics Ombudsperson who any CPUC employee or member of the public can contact at any time with any concern and who is responsible for enhanced ethics training for all CPUC staff and commissioners, on everything from gift and travel ethics to ex parte compliance.

--Codify the creation of the Deputy Director for Safety with plenipotentiary power to "red tag" any unsafe facility, process or activity.

--Require the CPUC to work with the Nuclear Regulatory Commission to expedite relocation of spent fuel currently stored at the San Onofre Nuclear Generation Station to an independent spent fuel storage installation.

--Increase oversight of excavation and improve enforcement of dig-in safety laws.

August 2016 - CMSA Communicator