July 15, 2024 #1 Local News, Information and Event Source for the Century City/Westwood areas.

Audit Shows Why PUC Reform Plan Not Enough

by Tom Elias

Less than a week had passed after Gov. Jerry Brown and several state legislators giddily announced their package of reforms for the scandal-ridden California Public Utilities Commission (PUC) before an official audit revealed why that plan is simply not good enough.

The audit by the state’s Department of General Services marked the first time in 20 years that the PUC’s practices had been officially examined, and the commission was found severely wanting.

But there have been and likely will be no consequences for anyone involved.

Also, no one has explained why 20 years passed between audits, when General Services reviews are supposed to come every three years. Perhaps it was because California’s last three governors – Brown, Arnold Schwarzenegger and Gray Davis – were all sympathetic to the commission’s steadfast favoritism of the huge companies it regulates over their customers.

The audit found the commission did not maintain proper paperwork on contracts and other matters. It said PUC employees most likely misused gasoline credit cards. But the most egregious offense noted came when the commission lawyered up in early 2015, just as federal and state agents began investigating some of its members for possible criminal wrongdoing.

Panic and fear ran rampant in the PUC’s San Francisco headquarters at the time, just after authorities searched the La Cañada-Flintridge home of the recently-departed former commission President Michael Peevey. That raid founded evidence Peevey and executives of the Southern California Edison Co. secretly agreed to dun customers $3.3 billion, or about 70 percent of the costs to close the San Onofre Nuclear Generating Station, shuttered because of an Edison blunder. An almost identical agreement soon became official.

Commissioners voted to hire an outside criminal law firm to help them through the investigation, awarding a contract that so far has amounted to about $12 million for the law firm SheppardMullin.

The General Services audit did not question the commission’s authority to do anything it has done, including awarding that contract. But it said the contract was “not…signed by a party who had been delegated signature authority in writing…”

In short, there was never proper legal authority for the firm – which has so far been most visible in helping the commission stonewall requests for documents and other information – to get all that money.

There are other questions about the propriety of commissioners under criminal investigation using state money to hire defense attorneys. The only PUC response to those questions was to cite government code section 995.8, which says a public entity can only hire criminal lawyers to defend present or former officials if “The public entity determines that such defense would be in the best interest of the public entity…” The PUC would have to hold hearings to make such a circular determination, but it never even did that.

The audit, then, makes it clear the commission lawyered up illegally in two ways, both by failing to hold hearings on whether it should hire SheppardMullin and by letting an unauthorized person sign the contract.

Yet there are no consequences. Brown has said nothing about any of this. PUC President Michael Picker, who repeatedly says his agency’s “culture” needs big changes, steadfastly refused to answer questions about the dicey contract.

That means the PUC, whose members cannot be fired during their six-year terms, is almost completely unaccountable for its actions. It acts illegally with impunity and no one touches its top officials.

That won’t change under the reform package, which includes several positives including provisions calling for a new ethics ombudsman and a deputy director in charge of the safety of natural gas and electricity transmission lines.

Those are positive changes, negotiated largely between Brown and Democratic Assemblyman Mike Gatto of Los Angeles, whose bill to break up the PUC and divide its tasks among several other state agencies easily passed the Assembly before Brown paid it any heed. But their deal, if passed by the Legislature as expected, leaves commissioners as unaccountable as ever.

And that makes the reforms too little and far too late to help consumers very much. 

Related Posts

Letter to the Editor: Criticizing Israeli Policy Is Not Antisemitic

July 10, 2024

July 10, 2024

In the past several months, we’ve seen increasing protests against Israel’s actions in Gaza. We have also seen these protests...

Opinion: Toxic Exposure May Impact Veterans’ Health Even Today

April 29, 2024

April 29, 2024

By Cristina Johnson  Military service members spend years in hazardous environments unknowingly, often developing fatal illnesses decades after their service....

If You Have a Loved One Experiencing Severe Mental Illness, We Can Help

February 15, 2024

February 15, 2024

By Lisa H. Wong, Psy. D Many families across Los Angeles County know what it’s like to watch a loved...

New Program Can Help Protect Southern California Homes in the Event of an Earthquake

May 13, 2023

May 13, 2023

Residents Have Until May 31 To Apply For Seismic Retrofit Grants By Janiele Maffei, Chief Mitigation Officer for the California...

Column: Tired OF Declinists? Some Enduring New California Positives

April 18, 2023

April 18, 2023

By Thomas D. Elias California has taken a beating lately, with (mostly Republican) governors of other states blasting many aspects...

Column: SB 9 Ended R-1 Zoning, but It’s Not Meeting Goals

March 11, 2023

March 11, 2023

By Tom Elias More than a year after it took effect, the landmark housing density law known as SB 9...

Westside Urban Forum: Small Can Be Good

March 1, 2023

March 1, 2023

I was invited by fellow Brentwood resident Josh Stephens to moderate a recent panel conversation conducted by the Westside Urban...

Column: The Inevitable Conversions Begin Multiplying

February 25, 2023

February 25, 2023

By Tom Elias It’s a phenomenon from New York to Dallas to Fresno and Los Angeles, one that seemed inevitable...

Column: The Fantasy World of California Housing Policy

February 20, 2023

February 20, 2023

By Tom Elias If you’re looking for sure things among bills under consideration in the state Legislature, think of one...

Column: State Usurping Key Powers From Cities

January 28, 2023

January 28, 2023

By Tom Elias All over California last fall, hundreds of the civic minded spent thousands of hours and millions of...

Column – A California Positive: Kids Swarm Extra Classes

January 24, 2023

January 24, 2023

By Tom Elias It’s become a cliché, the shibboleth that California has lousy public schools and most of the kids...

​​Column: No One Very Pleased as New Rooftop Solar Rules Improve

December 9, 2022

December 9, 2022

By Tom Elias, Columnist Only rarely does the California Public Utilities Commission, long known as the least responsive agency in...

Column – Gas Gougers Beware: California Is Onto You at Last

November 11, 2022

November 11, 2022

By Tom Elias It has taken more than 50 years of on-and-off gasoline price gouging, but at long last California...

$87,581,047.01: Candidate Rick Caruso on Pace to Smash All Spending Records in His Bid to Become Mayor of Los Angeles

November 4, 2022

November 4, 2022

Caruso overwhelming Bass nearly 10-1! By Nick Antonicello According to the LA Ethics Commission as of October 31st, billionaire developer...

Column: Money & Messaging That Is Persuasive and Memorable May Just Make Rick Caruso Our Next Mayor!

October 25, 2022

October 25, 2022

Moving away from direct mail, Caruso saturates broadcast television with a more disciplined message that is resonating with an angry...