CALIFORNIA FOCUS
FOR RELEASE: FRIDAY, MARCH 15, 2019 OR THEREAFTER
BY THOMAS D. ELIAS
FOR RELEASE: FRIDAY, MARCH 15, 2019 OR THEREAFTER
BY THOMAS D. ELIAS
“LET'S MAKE THE PUC
ELECTIVE”
Travel
back in time to the mid-1980s, when California’s insurance rates for both cars
and property were nearly the highest in America and climbing fast. In that era,
state insurance commissioners, who held the power to stop much of that
acceleration, were appointed by the governor.
Then
came 1988, when a consumer group called the Foundation for Taxpayer and
Consumer Rights (now known as Consumer Watchdog) and its leader decided to
change all that. The group ran a ballot initiative known as Proposition 103,
which made the insurance commissioner an elected official. Since then,
California insurance rates have risen slower than those in any other state,
saving customers over $100 billion. Coverage here remained as good as anywhere.
It’s
now high time to regulate utility companies as firmly as insurance companies
and to make utility regulators responsible to the public and the voters just
like the elected insurance commissioner.
No
industry has been cozier with those who regulate it than electric and gas
utilities, which regularly get large rate increases, deserved or not. Debacles
like the blunder-caused closure of the San Onofre Nuclear Generating Station
and the 2010 San Bruno gas pipeline explosion never dented the ever-rising
rates and steady profits of companies like Pacific Gas & Electric, Southern
California Edison and San Diego Gas & Electric.
Lax
regulation also may have contributed to several of the huge wildfires that have
plagued California over the last two years.
Into
this scene now steps new Gov. Gavin Newsom, who vowed in an interview during
his campaign to fight corruption that was allowed to fester in some parts of
state government under predecessor Jerry Brown.
“I will
not be timid about this or anything else,” he said. “Jerry Brown said reform is
overrated. I say it’s underrated.”
The
obvious way for Newsom to reform the state Public Utilities Commission would be
to appoint some new members to the five-person panel. But the state
Constitution doesn’t allow that to happen fast.
PUC
members serve staggered six-year terms, so no governor can name the entire
complement unless he or she gets two terms, like Brown did. Brown filled the
group with former aides, including current PUC President Michael Picker, who
voted, as just one example, for a San Onofre settlement plan originating in an
illegal meeting between former PUC boss Michael Peevey and Edison executives.
It had customers paying 70 percent of the cost of Edison’s shutdown error,
until public outcries caused the arrangement to be changed four years later.
Barring
sudden resignations or the death of a member, Newsom is to get only three PUC
appointees, one already named this year, and two more at the beginning of 2021.
In January, he appointed Genevieve Shiroma, a farmer’s daughter and longtime
member of the state Agricultural Labor Relations Board and elected board member
for the Sacramento Municipal Utility District. Quick change is unlikely at the
current pace.
The
obvious way to create faster, orderly reform is to make PUC commissioners
elected officials. This could be done via a 2020 ballot proposition, with an
election to follow.
Even
this would be slow and frustrating, with the current PUC majority continuing
policies that favor utilities and cost consumers billions of dollars they
probably should not be paying. Simultaneously, the PUC tries to delay and
hamstring creating and expanding municipally-controlled Community Choice
Aggregations, which often supply greener energy than the utilities at lower
prices.
Newsom
wasn’t specific about how he’ll combat corruption, except to say he will try to
alter state contracting practices to make sure they always involve competitive
bidding.
All
this leads to the reality that it’s high time to take the PUC down a peg or
three from its current exalted position, where members cannot be fired even by
the governor who appointed them and their decisions are not subject to lawsuits
in ordinary courts.
It will
take time to make this 104-year-old agency answer to the voters. But that would
be time well spent, even though the commission can be counted on to do whatever
it can to maintain its status quo and quash any attempt to reduce its
privileged status.
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Email Thomas Elias
at tdelias@aol.com. His book, "The Burzynski Breakthrough: The Most
Promising Cancer Treatment and the Government’s Campaign to Squelch It,"
is now available in a soft cover fourth edition. For more Elias columns, visit www.californiafocus.net