Public utilities: merger, acquisition, or control of electrical or gas corporations.

(1) Under existing law, the Public Utilities Commission has regulatory authority over public utilities, including electrical corporations and gas corporations. Existing law prohibits a public utility, other than certain common carriers, from selling, leasing, assigning, mortgaging, or otherwise disposing of, or encumbering its assets that are necessary or useful in the performance of its duties to the public by any means with any other public utility, unless the public utility has secured an order from the commission to do so for a qualified transaction above $5,000,000 or an approval from the commission through the filing of an advice letter for a qualified transaction at or below $5,000,000. This bill would eliminate the requirement that the above-described transactions be with another public utility to be subject to those conditions on approval. The bill would explicitly require the commission to approve or reject any voluntary or involuntary change in ownership of assets from an electrical or gas corporation to ownership by a public entity and would require the commission to determine whether that transaction is fair and reasonable to the affected public utility employees as part of that review. (2) Existing law prohibits a person or corporation, including a public entity, from merging, acquiring, or controlling, as described, either directly or indirectly, any public utility organized and doing business in this state without first securing authorization to do so from the commission. Before authorizing the merger, acquisition, or control of any electrical, gas, or telephone corporation organized and doing business in this state, where any of the entities that are parties to the proposed transaction has gross annual California revenues exceeding $500,000,000, existing law requires the commission to consider specified criteria and to find that the merger, acquisition, or control proposal meets certain requirements and is in the public interest, as specified. This bill would require the commission, before authorizing a merger, acquisition, or change in control of an electrical or gas corporation, where an entity to the proposed transaction has gross annual California revenues exceeding $400,000,000, to additionally consider specified elements relating to the safety activities of an electrical or gas corporation, including a nonpunitive system for reporting potential safety incidents to the commission, and find, on balance, that the proposal is in the public interest. The bill would authorize the commission to delay the requirement that the commission consider these specified elements and find, on balance, that the proposal is in the public interest, until July 1, 2021, or until the commission adopts rules implementing this requirement, whichever is earlier. The bill would prohibit subjecting an employee of, or the employee of a contractor performing work for, the electrical or gas corporation to demotion, discharge, or any other form of retaliation or discrimination for participating in the nonpunitive system for reporting potential safety incidents. The bill would eliminate the requirement for these reviews for a change in ownership in the assets of an electrical or gas corporation to ownership by a public entity. (3) Under existing law, a violation of any provision 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 are within the act and a violation of an order, decision, rule, direction, demand, or requirement of the commission implementing the bill's requirements would be a crime, the bill would impose a state-mandated local program. 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.