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STATE OF CALIFORNIA EDMUND G. BROWN JR., Governor

PUBLIC UTILITIES COMMISSION

505 VAN NESS AVENUE

SAN FRANCISCO, CA 94102-3298

May 8, 2012 Agenda ID #11329

To: Service List for Draft Resolution ALJ-268 (Appendix C)

As you know, on February 25, 2010, the Commission adopted Resolution ALJ-244, which updates the Commission's advice letter pilot program for certain transfers of utility property that require advance approval pursuant to Public Utilities Code Section 8511 (the pilot program), in view of Assembly Bill (AB) 698 (Stats. 2009, ch. 370) (effective January 1, 2010). Resolution ALJ-244 also extended the pilot program for an additional year until August 23, 2011, in order to allow the Commission sufficient time to evaluate the effectiveness of the amended pilot program. Resolution ALJ-272 extended the pilot program until August 23, 2012, unless sooner extended or made permanent.

This draft resolution proposes the adoption of a General Order which makes the pilot program permanent as set forth in the attached proposed General Order. Opening comments on this draft resolution and attached proposed General Order shall be submitted to Administrative Law Judge (ALJ) Myra J. Prestidge, by no later than Tuesday, May 29, 2012 by mail sent to the above address, facsimile sent to (415) 703-1723, or by e-mail addressed to tom@cpuc.ca.gov. Reply comments shall be submitted to Judge Prestidge by Monday, June 4, 2012. Comments should be consistent with the requirements of Rule 14.3 of the Commission's Rules of Practice and Procedure. In addition, please serve a copy of your opening and reply comments on the service lists attached to this letter, to Assistant Chief Administrative Law Judge Janet Econome at jjj@cpuc.ca.gov; and Andrew Barnsdale, Energy Division, at bca@cpuc.ca.gov. Persons who do not have access to e-mail may serve a hard copy of their comments by mail. Please serve ALJ Prestidge, Assistant Chief ALJ Econome, and Andrew Barnsdale by hard copy and e-mail.

If you have questions, please do not hesitate to contact ALJ Prestidge at (415) 703-2629 or by email addressed to tom@cpuc.ca.gov; or Assistant Chief ALJ Econome at (415) 703-1494 or by e-mail at jjj@cpuc.ca.gov.

/s/ Maryam Ebke for

Karen V. Clopton, Chief

Administrative Law Judge

KVC:gd2

cc: Janet Econome, ACALJ

Attachment

ALJ/TOM/gd2 DRAFT Agenda ID #11329

PUBLIC UTILITIES COMMISSION OF THE STATE OF CALIFORNIA

R E S O L U T I O N

RESOLUTION ALJ-268. Adopts General Order ____, which makes permanent and modifies the Pub. Util. Code § 851 Pilot Program Established in Resolution ALJ-186, as modified by Resolution ALJ-202 and Resolution ALJ-244 and extended in Resolution ALJ-272.

SUMMARY

This resolution adopts General Order (GO) ____ (attached as Appendix A), which makes the Pub. Util. Code § 8512 pilot program established in Resolution ALJ-186 (adopted August 25, 2005), modified by Resolution ALJ-202 (adopted August 23, 2007) and Resolution ALJ-244 (adopted March 2, 2010) and extended by Resolution ALJ-272 (adopted August 18, 2011) (the pilot program), permanent, makes minor technical amendments to the pilot program regulations for the purpose of clarity, and renumbers and reorders the regulations.

We further direct Commission staff to hold a workshop with interested parties to discuss options for clarification of GO 69-C, which authorizes public utilities to implement certain transactions involving the transfer of minor, revocable interests in utility property, such as certain easements, licenses, or permits, without prior Commission approval, within 180 days of this order and to issue a written report to the Commission with recommendations within the following 120 days. The Director of the Commission Energy Division may extend the time for holding the workshop and/or submitting the workshop report to the Commission for good cause.

In addition, pursuant to Section 853(b), we grant PacifiCorp an exemption from Section 851 only for transactions that meet the following criteria: a) the transaction involves PacifiCorp property or assets located entirely outside of California, b) PacifiCorp has received any legally required approval of the transactions from governmental agencies regulating public utilities in other states in which PacifiCorp conducts business, to the extent that such approvals are legally required, c) the fair market value of the transaction allocated to California will not exceed $10,000, and d) the transaction, if it were reviewed by the Commission as part of making a discretionary decision, would not require environmental review pursuant to the California Environmental Quality Act.

BACKGROUND

A. Commission Adoption of Resolution ALJ-186

On August 25, 2005, the Commission adopted Resolution ALJ-186, which established a two-year pilot program for processing and approving certain transfers of interests in utility property through advice letters, rather than formal applications under Section 851. Section 851 generally requires Commission approval of any sale, lease, encumbrance, mortgage, or other transfer or disposition of an interest in utility property that is necessary or useful in the provision of the utility's services to the public.3 The purpose of the Commission's review is to ensure that the proposed transaction is not adverse to the public interest, i.e., does not impair the ability of the utility to provide safe and reliable service to customers at reasonable rates.

Before our adoption of the pilot program, utility transactions involving the transfer or disposition of interests in property necessary or useful in the provision of services to the public generally required a formal application and a Commission decision pursuant to Section 851. The purpose of the pilot program was to expedite and simplify the Commission's review and approval of non-controversial transactions involving the transfer or conveyance of interests in utility property that did not require environmental review by the Commission as a Lead Agency under the California Environmental Quality Act (CEQA), and did not warrant more extensive review by the Commission through the formal application process.

B. Legislative Adoption of Assembly Bill 736 (Effective January 1, 2006)

Also in 2005, the Legislature adopted Assembly Bill (AB) 736 (Stats. 2005, ch. 370, Section 1), effective January 1, 2006, which amended Section 851. These amendments authorized the utilities to obtain Commission approval of transactions involving transfers or disposition of property interests that are valued at $5 million or less by filing an advice letter and obtaining a Commission resolution approving the transaction, rather than filing a formal Section 851 application and seeking a Commission decision.4

Under Section 851, as amended by AB 736, the Commission was required to approve or deny advice letter requests within 120 days of the utility's filing of the advice letter by resolution, unless the advice letter application does not include complete information or a timely protest has been filed.

AB 736 also added Section 853(d), to the Public Utilities Code. Section 853(d) provided that:

· The intent of the Legislature is that transactions with monetary values that materially impact a utility's rate base should not qualify for advice letter treatment, so that the utility must file a formal Section 851 application in order to obtain Commission approval of the transaction;

· The intent of the Legislature is that, in reviewing transactions subject to Section  851, the Commission should retain all of its responsibilities under CEQA;

· Public utility transactions that "jurisdictionally trigger" CEQA review by the Commission do not qualify for expedited advice letter treatment.5

C. Commission Adoption of Resolution ALJ-202

In August 2007, the Commission adopted Resolution ALJ-202, which amended the pilot program regulations to conform with AB 736 and GO 96-B.6 Resolution ALJ-202 implemented AB 736's requirement that Section 851 advice letters be approved by Commission resolution. Accordingly, the Resolution characterized Section 851 advice letters as Tier 3 advice letters under GO 96-B.7

Based on Section 853(d), Resolution ALJ-202 further required the utilities to file formal applications, rather than advice letters under the following circumstances: (i) to seek approval of transactions that require CEQA review by the Commission as either a Lead Agency or a Responsible Agency,8 or (ii) when a transaction will materially impact the ratebase of the utility, even if the transaction is valued at $5 million or less.9

In Resolution ALJ-202, we also extended the pilot program for an additional three years, until August 23, 2010, in order to allow sufficient time to consider whether the pilot program should be continued, allowed to expire, or further modified, and to obtain additional comments from interested parties on these issues.

D. Legislative Adoption of AB 698 (Effective January 1, 2010)

In 2009, the Legislature adopted AB 698 (Stats. 2009, ch. 370), which further amended Sections 851 and 853(d) in order to permit Commission staff approval of certain advice letters and to expand the types of transactions which the Commission may approve by advice letter. AB 698 became effective on January 1, 2010. AB 698 amended Sections 851 and 853 to provide that:

o The advice letter is uncontested;

o The advice letter does not require CEQA review by the Commission as either the Lead Agency or a Responsible Agency; and

o The transaction will not materially impact the utility's ratebase.

Under AB 698, if the proposed transaction would require CEQA review by the Commission as the Lead Agency, the utility is still required to file a formal application for Commission approval pursuant to Section 851.

AB 698 retained the requirement that the Commission process advice letters within 120 days of their filing by the utility, unless the utility did not submit complete documentation with the advice letter or a protest is filed.

E. Commission Adoption of Resolution ALJ-244

On March 2, 2010, the Commission adopted Resolution ALJ-244 in order to implement AB 698. Resolution ALJ-244 authorized the Executive Director or the Director of the Commission Division having regulatory jurisdiction over the utility to approve, modify, or deny uncontested advice letters for qualifying transactions that do not require CEQA review.11 We made this change to the pilot program in order to expedite Commission processing of certain routine, non-controversial transactions that meet the requirements of AB 698 for advice letter handling.12 We also amended the pilot program regulations to delete language which stated that an Industry Division may reject an advice letter if its consideration would involve the exercise of discretion by Commission staff, because AB 698 expressly authorizes the Executive Director or the appropriate Industry Division Director to act on certain advice letter applications. We then retained existing language in the pilot program regulations that authorizes the appropriate Industry Division to reject an advice letter because its consideration is otherwise barred by GO 96-B.

Resolution ALJ-244 also amended the pilot program regulations to implement AB 698's amendment of Section 853(d), so that the utilities may file advice letters to seek Section 851 approval of transactions valued at $5 million or less, in cases that require environmental review by the Commission only as a Responsible Agency under CEQA, when the Lead Agency has completed its CEQA review. Under Resolution ALJ-244, the utilities are still required to file formal Section 851 applications for transactions which require environmental review by the Commission as the Lead Agency under CEQA.

Resolution ALJ-244 retained the provision of our pilot program that requires the utilities to file a formal application when a particular transaction valued at $5 million or less warrants a more extensive review or will materially impact the ratebase of the utility. These provisions ensure that the Commission is able to more thoroughly assess proposed transactions when necessary or appropriate in order to protect the public interest.

In addition, Resolution ALJ-244 extended the pilot program for an additional year, or until August 23, 2011, in order to allow time to obtain and consider comments from interested parties regarding whether the pilot program should be continued, made permanent, or discontinued, and any additional suggestions for changes to the pilot program, and directed the Chief Administrative Law Judge (ALJ) to request such comments within 90 days of the effective date of Resolution ALJ-244.

F. Comments of Interested Parties on Section 851 Pilot Program, as Amended by Resolution ALJ-244

On May 14, 2010, the Chief ALJ mailed a letter to the service list for Resolution ALJ-244, requesting comments on whether the pilot program should be continued, discontinued, or made permanent, and any other suggested changes to the pilot program. Notice of the opportunity to file comments was also posted on the Commission website.

Timely opening comments were received from PG&E, PacifiCorp, San Diego Gas & Electric Company and Southern California Gas Company jointly (SDG&E/SoCalGas), Southern California Edison Company (SCE), Southwest Gas Corporation (SW Gas), and the Small LECs.13 Timely reply comments were received from the Commission Division of Ratepayer Advocates (DRA), PG&E, PacifiCorp, SCE, and the Small LECs. A summary of these comments is attached as Appendix B.

We address the principal comments of the parties in the discussion below.

G. Commission Adoption of Resolution ALJ-272

On August 18, 2011, the Commission adopted Resolution ALJ-272, which extended the pilot program until August 23, 2012, unless sooner extended or made permanent, in order to allow time for the Commission to further consider the comments of the parties on the pilot program and whether the pilot program should be continued or made permanent.

DISCUSSION

Based on the Commission's experience with the pilot program and upon consideration of the comments filed by interested parties, we take the following actions:

1. Making the pilot program permanent. Nearly all of the parties filing comments support continuation of the pilot program and/or making the pilot program permanent. The Commission agrees with the parties that the pilot program has helped to expedite Commission review and approval of transactions subject to Section 851, which saves valuable time and resources for the utilities, third parties engaging in transactions with the utilities, and the Commission. In addition, Section 851, as amended by AB 736 and AB 698 expressly authorizes public utilities to apply for Section 851 advice letters for certain transactions valued at $5 million or less under specified circumstances. We therefore make the pilot program permanent, effective today, and codify the former pilot program regulations, with the changes discussed below, as GO ___, attached as Appendix A.

We may later consider additional modifications to the Section 851 advice letter program based on any future legislative amendments of Section 851 and the continued experience of the Commission and interested parties with the program.

2. Workshop Regarding Clarification of GO 69-C and Subsequent Staff Report to the Commission. SDG&E/SoCalGas, PG&E, SCE, and the Small LECs all requested in their comments that the Commission clarify when GO 69-C14 applies to particular transactions, so that Commission approval of the transaction pursuant to Section 851 is not required. Parties have commented that they are at times uncertain whether GO 69-C applies to particular transactions, and regarding what constitutes a "limited use" of utility property which may be conveyed to a third party without prior Commission approval pursuant to GO 69-C.15 As a result, according to the comments of certain parties, utilities may in some cases end up filing unnecessary advice letters or formal applications pursuant to Section 851 for minor transactions which could fall under GO 69-C. If true, this situation could result in expenditures of valuable Commission and utility time and resources on minor transactions.

We note that the Commission has previously considered this issue. In 2002, PG&E, SCE, and California-American Water Company filed a petition for rulemaking under Section 1708.5 (Petition (P.) 02-02-003) seeking clarification and expansion of GO 69-C. In D.02-10-057, the Commission denied the petition for rulemaking on the grounds that the parties did not recommend specific changes to GO 69-C and that a fact-specific analysis is needed to determine whether GO 69-C applies to a particular transaction, but also ordered Commission staff to conduct a workshop on possible amendments to GO 69-C. In D.05-04-055, the Commission adopted the staff report on the workshop held pursuant to D.02-10-057, directed staff to expeditiously develop options for streamlining Section 851 review and clarifying use of GO 69-C for presentation to the Commission, and closed the proceeding. The Commission subsequently adopted Resolution ALJ-186, which established the pilot program, in order to simplify and expedite the process for review of certain transfers of utility property pursuant to Section 851. As stated in D.05-04-055, we believe that further consideration of whether it is possible to clarify when GO 69-C applies to particular transactions, other than on a case-by-case, fact-specific basis, and certain other issues raised by the parties regarding the applicability of GO 69-C, is warranted.

We therefore direct Commission Energy Division staff to hold an additional workshop with interested parties to discuss options for clarifying the scope of GO 69-C within 180 days of this order, and to issue a written report to the Commission with recommendations on these issues within the following 120 days. The Director of the Commission's Energy Division may extend the time for holding the workshop and/or submitting the report to the Commission for good cause.

Commission Energy Division staff shall give at least 30 days advance written notice of the date, time, and place of the workshop to the service lists for this Resolution and any other persons or entities that request such notice. A copy of the workshop notice shall also be posted on the Commission website at least 30 days before the workshop is held, in order to give additional opportunity for public participation.

3. Response to comments filed by the parties regarding GO 69-C/Scope of workshop. Although we wish to give Commission staff and the parties flexibility to consider various ways to clarify GO 69-C, we address certain issues raised in the comments of the parties in order to help define the scope of the workshop and subsequent staff report as follows:

A. Proposed clarification of GO 69-C to specify that if a third party lessee or easement holder can remove its facilities from utility land in 30 days, this use of utility property should be considered a "limited use." We reject PG&E's recommendation that if a third party lessee or easement holder can remove its facilities from utility land within 30 days, this use of utility property should be considered a "limited use" under GO 69-C. Adopting the recommendation would, as a practical matter, permit third parties to construct significant facilities or structures on utility property without CEQA review or Commission authorization pursuant to Section 851. This outcome would conflict with past Commission decisions which state that for GO 69-C to apply, the transaction must not involve a significant or permanent alteration to utility property or facilities,16 and the proposed use must not require CEQA review, if the Commission were making a discretionary decision on the project. Our previous decisions have generally restricted the term "limited use" under GO 69-C to include temporary uses, uses which are not incompatible with resumed use of the property by the utility, or the installation of facilities on utility property that are easily removable without delay and are not subject to CEQA review.17

However, we acknowledge that in some cases, the application of GO 69-C to minor uses of utility property, which would not require CEQA review if the Commission were making a discretionary decision on the project, may be appropriate. The parties and Commission staff may consider whether it is possible to further define the types of uses which qualify as "limited uses" of utility property under GO 69-C at the workshop to be held pursuant to this order.

B. Proposed presumption that utility acted in good faith in relying on GO 69-C instead of applying for Section 851 approval of transactions. We also reject SCE's recommendation that the Commission create a presumption that a utility acted in good faith in relying on GO 69-C, instead of applying for Section 851 approval of transactions. We acknowledge that in some circumstances, a utility may make a good-faith error in relying on GO 69-C. However, in past cases, some utilities have improperly relied on GO 69-C for certain transactions, instead of applying for Section 851 approval. We therefore do not believe it is appropriate to adopt a presumption that the utility acted in good faith in relying on GO 69-C. However, if a utility relies on GO 69-C and enters into a transaction without prior Commission approval, and the Commission later finds that the transaction required advance approval pursuant to Section 851, we will consider any evidence presented by the utility that it made a genuine error and acted in good faith in determining whether to impose a penalty for violation of Section 851.

4. Response to comments filed by parties regarding pilot program. We respond to the principal comments of the parties regarding proposed modifications to the pilot program, as follows:

A. Proposed Reduction of Time Period for Staff Processing of Section 851 Advice Letters. We decline to adopt PG&E's recommendation that the Commission reduce the review period for Section 851 advice letters to a period less than the 120 days specified by Section 851. Although we agree with PG&E that expediting the review and processing of advice letters for routine transactions subject to Section 851 could save valuable time and resources, the Commission may need the full 120 days allowed by the statute to adequately assess whether a particular transaction is adverse to the public interest. We will not shorten the statutory timeframe for review of advice letters because in some cases, doing so might compromise our ability to adequately protect the interests of the public.

We note that Commission staff has, in many cases, been able to process and approve Section 851 advice letters within a substantially shorter timeframe than 120 days. As pointed out in DRA's comments, Commission staff's average time for processing a Section 851 advice letter is approximately 30 days less than the 120 days permitted by statute. Commission staff has already implemented procedures, including some of those recommended by PG&E, to reduce the time required to process Section 851 advice letters and will continue its efforts to expedite the handling of these matters whenever possible.

B. Proposed Exemption of Certain "De Minimis" Transactions from Section 851 Review. PG&E, SCE, SDG&E/SoCalGas, the Small LECs, and Pacificorp commented that the Commission should consider exempting certain de minimis transactions that have a low dollar value from Section 851's requirement for prior Commission approval by either advice letter or formal application. Under Section 853(b), the Commission has legal authority to exempt certain transactions or classes of transactions from the requirements of Section 851 when doing so is in the public interest.18

Although we agree that exempting certain minor transactions from the requirements of Section 851 would conserve both Commission and utility time and resources, we decline to adopt the proposal presented by the above parties in their comments. We find it inappropriate to designate a specific dollar amount below which "de minimis" transactions are exempt from Section 851 review here, for the following reasons:

· Varying size and financial condition of California's public utilities. California's public utilities include both large and small companies which have varying financial resources and conditions. It is therefore difficult to determine a specific dollar amount below which transactions otherwise subject to Section 851 could be exempted from the requirement for prior Commission approval, without violating Section 853(d)'s requirement that the Commission review transactions that will materially impact a utility's ratebase in some cases. For example, a transaction with a relatively low dollar value could significantly impact the ratebase of a very small utility and the utility's ability to serve customers, while a transaction with a high dollar value may not materially impact the ratebase or customers of a large utility, such as PG&E. Although parties have suggested a dollar amount of between $30,000 and $50,000 as the ceiling below which Section 851 review would not be required, we do not believe that a "one size fits all" approach is workable in view of the broad range of utilities operating in this state.

· Need for Commission regulation to protect public safety and the ability of the utility to operate. In some cases, exempting particular transactions from the requirements of Section 851 could also interfere with the Commission's ability to protect the public safety. For example, in recent years, some of the electric utilities have applied for Commission authorization pursuant to Section 851 to lease or grant easements on their property located under power lines to third parties for various uses, such as a carwash, a vehicle storage facility, or other storage facilities. Although the dollar value of these transactions may be relatively low, the requirement for Section 851 approval has enabled the Commission to ensure that the proposed use would be carried out in a manner consistent with our GOs regarding the proximity of facilities to power lines and other requirements which protect the public safety, and that the lease or easement will not interfere with the utility's operations and access to its facilities on the property. We do not believe that exempting these types of transactions from Section 851, simply because the transactions have a relatively low dollar value, is in the public interest.

· Protection of the environment. In addition, a transaction which has a small dollar value to the utility may cause significant adverse environmental impacts, depending on the type of activity that the third party acquiring the interest in utility property plans to conduct on-site and whether the utility property is located in an environmentally sensitive area. If the transaction were exempted from Section 851 review because of a low dollar value, the Commission would not be making a discretionary decision on the project that would trigger the requirement for CEQA review.19 Therefore, the Commission would not have the opportunity to conduct environmental review of the proposed project or to require mitigation measures in order to protect the environment.20

Although we decline to adopt a general exemption from Section 851 for transactions below a specified dollar amount here, the utilities may continue to file applications pursuant to Section 853(b) to request the exemption of particular transactions or classes of transactions from the requirements of Section 851 in appropriate cases.

C. Proposed Ex Parte Process for Section 851 Applications Valued at Over $5 Million but Less than $10 Million. We decline to adopt SCE's recommendation that the Commission develop an ex parte process for reviewing Section 851 transactions valued at more than $5 million but less than $10 million, when no protest is filed. It is uncertain what SCE means by this recommendation, and the Commission already handles unprotested Section 851 applications on an ex parte basis, in that no hearing is held in these cases. In addition, since Section 851 limits the applicability of the advice letter process to transactions valued at $5 million or less, formal Section 851 applications are required for transactions valued at over $5 million but less than $10 million.

5. Exemption of Certain Transactions Conducted by PacifiCorp from the Requirements of Section 851, pursuant to Section 853(b). PacifiCorp is a multi-jurisdictional utility providing electric retail service to customers in California, Idaho, Oregon, Utah, Washington, and Wyoming. As stated in its comments, PacifiCorp believes that transactions involving the transfer of its system assets are subject to the requirements of Section 851, because nearly all of its transmission and generation assets are used to serve customers in all six states, including California.

Since PacifiCorp's California service territory represents less than two percent of its customer load, the transactions subject to Section 851 result in sales proceeds allocated to California which PacifiCorp views as de minimus. For example, the fair market value of transfers of PacifiCorp system assets allocated to California in 2010 was approximately $9,000 to $13,500. All of these transactions occurred in states other than California.

PacifiCorp therefore recommends that the Commission explore options for expedited review of transactions subject to Section 851 that occur outside of California, have fair market values allocated to California of $10,000 or less, and are exempt from review under CEQA.

We agree with PacifiCorp that these types of transactions should be exempted from Section 851, because they will not materially impact PacifiCorp's ratebase and will not impact the ability of PacifiCorp to provide service to California customers at reasonable rates. We believe it is extremely unlikely that these transactions will be adverse to the interests of California ratepayers.21 Therefore, the benefit of Commission review of these transactions pursuant to Section 851 seems minimal, when balanced against the cost to PacifiCorp in preparing an advice letter, the time and resources spent by the Commission in reviewing the transaction, and any resulting delay for PacifiCorp and third parties in carrying out the transaction.

For these reasons, we find that it is in the public interest to grant PacifiCorp an exemption from Section 851 pursuant to Section 853(b) only for transactions that meet the following criteria: a) the transaction involves PacifiCorp property or assets located entirely outside of California, b) PacifiCorp has received approval of the transactions from governmental agencies regulating public utilities in other states in which PacifiCorp conducts business, to the extent that such approvals are legally required, c) the fair market value of the transaction allocated to California will not exceed $10,000, and d) the transaction, if reviewed by the Commission as part of making a discretionary decision, would fall within a CEQA exemption or would not require CEQA review.

For all other transactions subject to Section 851, PacifiCorp must file an advice letter or formal application to obtain advance Commission approval or file an application to request exemption of the transaction from Section 851 pursuant to Section 853(b).

6. Minor, Technical Amendments of Former Pilot Program Regulations/ Renumbering and Reordering of Former Pilot Program Regulations.

We have made minor technical and clarifying changes to the language, numbering, and format of the former pilot program regulations for the purpose of adopting GO ____, as set forth in Appendix A. In particular, we have amended former pilot program regulation Section II. A. 9. (now GO Rule 3.j) to read as follows, for the purpose of clarity:

If the transaction is a transfer or change in ownership of facilities currently used in regulated utility operations, the transaction will not result in a significant physical or operational change in the facility.22

PUBLIC REVIEW AND COMMENTS

The proposed Resolution was mailed to the parties for review and comment on ________________, 2012, pursuant to Public Utilities Code Section 311(g)(1). Timely comments were received from __________________________________________.

FINDINGS AND CONCLUSIONS

1. The pilot program originally adopted in Resolution ALJ-186, amended in Resolutions ALJ-202 and ALJ-244, and extended in Resolution ALJ-272, which authorizes the use of advice letters to obtain Commission review and approval of certain transactions subject to Public Utilities Code Section 851, is made permanent, in order to fulfill the legislative intent of the amendments to Public Utilities Code Sections 851 and 853 enacted by AB 736 (2005) and AB 698 (2009).

2. GO ___, attached to this Resolution as Appendix A, largely codifies the current regulations for the Section 851 pilot program.

3. GO ___ (Appendix A) makes minor technical and clarifying changes to the language, numbering, and ordering of the previous pilot program regulations (as set forth in Resolution ALJ-244, Appendix A).

4. Former pilot program regulation Section II. A. 9., (now GO Rule 3.j) should be amended to read as follows, for the purpose of clarity: "If the transaction is a transfer or change in ownership of facilities currently used in regulated utility operations, the transaction will not result in a significant physical or operational change in the facility."

5. It is appropriate for the Commission to hold a workshop, which shall be open to interested parties and members of the public, regarding clarification of GO 69-C, in an effort to resolve any confusion or ambiguity regarding when GO 69-C applies to transactions otherwise subject to Section 851, to address comments previously filed by interested parties regarding GO 69-C, and any additional related issues that may be raised at the workshop.

6. It is appropriate for the Commission to reject the proposal of certain parties that transactions in which structures or facilities could be removed from utility land within 30 days should be exempted from Section 851, because: a) adopting this proposal would allow parties to construct significant facilities or structures on utility land without Commission review of whether these uses would interfere with the utility's ability to operate would adversely impact ratepayers, or would cause significant adverse environmental impacts, and b) this proposal would conflict with past Commission decisions.

7. It is appropriate for the Commission to decline to adopt a presumption that the utility acted in good faith in relying on GO 69-C, instead of applying for Section 851 approval of a transaction, because in some past cases, utilities have improperly relied on GO 69-C, and the Commission can better assess whether the utility acted in good faith by considering the evidence in each case.

8. It is appropriate for the Commission to decline to shorten the timeframe for processing and approving Section 851 advice letters to less than the 120 days allowed by law because in some cases, the Commission may need the full 120 days to assess whether a particular transaction would be adverse to the public interest pursuant to Section 851.

9. It is appropriate for the Commission to decline to adopt a "de minimus" dollar amount below which transactions otherwise subject to Section 851 would be exempted from Section 851 review, for the following reasons: a) in the case of a small utility, a transaction with a relatively low dollar amount may materially impact ratebase, so that Commission review of the transaction is needed in order to protect the public interest, b) even in cases involving transactions which have a relatively low dollar value, the Commission may still need to review and place conditions on transactions in order to protect the public safety and the ability of the utility to operate and serve customers, and c) since even transactions with a relatively low dollar value may have significant adverse environmental impacts, the Commission needs to retain its discretion to approve, disapprove, or place conditions on transactions in order to protect the environment for the benefit of the public.

10. It is appropriate for the Commission to decline to adopt an expedited ex parte process for transactions subject to Section 851 that have dollar values between $5 million and $10 million, because this proposal is unclear, and the Commission already reviews transactions subject to Section 851 on an ex parte basis unless a protest is filed.

11. It is appropriate to grant Pacificorp's request for an exemption from Section 851 for certain transactions, as specified below, pursuant to Section 853(b) because it is unlikely that these transactions will have an adverse impact on California ratepayers or the ability of Pacificorp to provide service in California. This exemption shall apply only to transactions that meet all of the following criteria: a) the transaction involves PacifiCorp property or assets located entirely outside of California; b) PacifiCorp has received any legally required approval of the transactions from governmental agencies regulating public utilities in other states in which PacifiCorp conducts business, to the extent that such approvals are legally required; c) the fair market value of the transaction allocated to California will not exceed $10,000; and d) the transaction, if reviewed by the Commission as part of making a discretionary decision, would not require environmental review pursuant to CEQA.

THEREFORE, IT IS ORDERED that:

1. General Order ___ (attached as Appendix A), which largely codifies the regulations for the former Public Utilities Code Section 851 pilot program with minor technical and clarifying changes and makes the pilot program permanent, is adopted.

2. Within 180 days of the effective date of this order, Commission Energy Division staff shall hold a noticed workshop to discuss potential ways to clarify and simplify the application of General Order 69-C with interested parties and the public. The scope of the workshop shall be consistent with our discussion in this order.

3. The Commission shall give at least thirty (30) days written notice of the date, time, and place of the workshop to be held regarding General Order 69-C to the service lists for this Resolution and Petition 02-02-003 and to any other persons or entities that request such notice. A copy of the workshop notice shall also be posted on the Commission website at www.cpuc.ca.gov at least 30 days before the workshop is held, in order to give additional opportunity for public participation.

4. Within 120 days after the above workshop, Commission Energy Division staff shall submit to the Commission a written workshop report, which contains its recommendations for clarifying the proper application of General Order 69-C.

5. The Director of the Commission's Energy Division may extend the deadlines for holding the above workshop and for submittal of the workshop report to the Commission for good cause.

6. Copies of the above workshop report shall be distributed to all parties on the service list for this Resolution and Petition 02-02-003, all parties that attended the workshop, and to any party that requests a copy. A copy of the workshop report shall also be posted on the Commission website.

7. Pursuant to Public Utilities Code Section 853(b), PacifiCorp is granted an exemption from the requirements of Public Utilities Code Section 851 only for its transactions that meet the following criteria: a) the transaction involves PacifiCorp property or assets located entirely outside of California, b) PacifiCorp has received approval of the transactions from governmental agencies regulating public utilities in other states in which PacifiCorp conducts business, to the extent that such approvals are legally required, c) the fair market value of the transaction allocated to California will not exceed $10,000, and d) the transaction, if reviewed by the Commission as part of making a discretionary decision, would fall within a statutory or categorical exemption to the requirement for environmental review under the California Environmental Quality Act (CEQA) or would not require environmental review under the CEQA.

This resolution is effective today.

I certify that the foregoing resolution was duly introduced, passed, and adopted at a conference of the Public Utilities Commission of the State of California held on __________________, the following Commissioners voting favorably thereon:

APPENDIX A

GENERAL ORDER _____ REGARDING

SECTION 851 ADVICE LETTERS

General Order ____

Public Utilities Code Section 851 Advice Letters

Rule 1. Statement of Purpose

This General Order (GO) modifies and makes permanent the former pilot program regulations for Section 851 advice letters, as adopted in Resolution ALJ-186 (adopted August 2005), amended by Resolution ALJ-202 (adopted August 2007) and Resolution ALJ- 244 (adopted March 2010), and extended by Resolution ALJ-272 (adopted October 18, 2011). These regulations authorize regulated utilities to request Commission approval pursuant to Public Utilities Code Section 85123 of certain transactions transferring interests in utility property valued at $5 million or less by advice letter.

Rule 2. General Rules

Rule 2.1. Who May File

Except as otherwise provided by state law or Commission order, any public utility may file an advice letter to seek Commission approval of any transaction involving the transfer or disposition of utility property valued at $5 million or less which meets the requirements for advice letter treatment specified in Section 851 and this GO. Approval of transactions involving proposed transfers of interests in Pacific Gas and Electric Company's watershed lands may be requested by advice letter subject to the procedures approved in Decision (D.) 10-08-004 or by subsequent order of the Commission. Public utilities exempted from the requirements of Section 851 by the Commission or state law need not file such advice letters for transactions otherwise subject to Section 851.

Rule 2.2. Right of the Commission to Require a Formal Section 851 Application for Certain Transactions Valued at $5 Million or Less

Notwithstanding the foregoing, the Commission's Executive Director or the appropriate Industry Division Director may require the utility to file a formal Section 851 application, rather than an advice letter, for certain transactions, based on the reasons stated in Rule 7.a.(3) below.

Rule 2.3. Right of Utilities to File Formal Section 851 Applications In Lieu of Advice Letters

Regulated utilities may choose to submit formal applications under Section 851 for transactions that qualify for advice letter treatment pursuant to this GO.

Rule 2.4. Applicability of GO 96-B/Conflicting Regulations

Advice letters filed pursuant to this order shall generally be processed pursuant to GO 96-B or its successor regulation, and shall comply with all applicable requirements under GO 96-B or its successor regulation, except as otherwise specified herein or as required by law.

Rule 2.5. Section 851 Advice Letters Shall Not be Deemed Approved by the Passage of Time or Without Express Action by the Commission, the Executive Director, or the Appropriate Division Director

Notwithstanding Rule 2.4 above or Rule 8 below, no advice letter filed pursuant to this GO shall be deemed approved due to the passage of time or unless the Commission, the Executive Director, or the appropriate Industry Division Director takes express action by approving, denying, or modifying the advice letter.

Rule 3. Section 851 Transactions Eligible for Advice Letter Treatment

Regulated utilities may file advice letters for transactions which require Commission approval under Section 851 and meet the following criteria:

a. The activity proposed in the transaction will not require environmental review by the Commission as a Lead Agency under the California Environmental Quality Act (CEQA), either because:

(1) A statutory or categorical exemption applies (the applicant must provide a Notice of Exemption from the Lead Agency or explain why it believes that an exemption applies), or

(2) The transaction is not a project under CEQA (the applicant must explain the reasons why it believes that the transaction is not a project), or

(3) Another public agency, acting as the Lead Agency under CEQA, has completed environmental review of the project, and the Commission is required to perform environmental review of the project only as a Responsible Agency under CEQA.

b. The transaction will not have an adverse effect on the public interest or on the ability of the utility to provide safe and reliable service to customers at reasonable rates.

c. Any financial proceeds from the transaction will be either:

(1) Booked to a memorandum account for distribution between shareholders and ratepayers during the next general rate case or other applicable proceeding for that utility, or

(2) Immediately divided between shareholders and ratepayers based on a specific distribution formula previously approved by the Commission for that utility.

d. If the transaction results in a fee interest transfer of real property, the property does not have a fair market value in excess of $5 million.

e. If the transaction results in a sale of a building or buildings (without an accompanying fee interest transfer of the underlying land), the building(s) does not have a fair market value in excess of $5 million.

f. If the transaction is for the sale of depreciable assets (other than a building or buildings), the assets do not have a fair market value in excess of $5 million.

g. If the transfer is a lease or a lease-equivalent, the total net present value of the lease payments, including any purchase option, does not have a fair market value in excess of $5 million, and the term of the lease will not exceed 25 years.

h. If the transaction conveys an easement, right-of-way, or other less than fee interest in real property, the fair market value of the easement, right-of-way, or other interest in the property does not exceed $5 million.

i. The transaction will not materially impact the ratebase of the utility. (This requirement does not apply to telephone corporations subject to the Uniform Regulatory Framework (URF) or which are not subject to rate of return regulation.)

j. If the transaction is a transfer or change in ownership of facilities currently used in regulated utility operations, the transaction will not result in a significant physical or operational change in the facility.

k. The transaction does not warrant a more comprehensive review that would be provided through a formal Section 851 application.

Rule 4. Contents of Advice Letters

In addition to other information required by GO 96-B or its successor regulation, advice letters shall include the following:

a. Identity and addresses of all parties to the proposed transaction;

b. A complete description of the property, including its present location, condition, and use;

c. The transferee's intended use of the property;

d. A complete description of the financial terms of the proposed transaction;

e. A description of how the financial proceeds of the transaction will be distributed;

f. A statement of the impact of the transaction on ratebase (except for advice letter applications filed by telephone corporations subject to URF or which are not subject to rate of return regulation), and any effect on the ability of the utility to serve customers and the public;

g. For sales of real property and depreciable assets, the original cost, present book value, and present fair market value, and a detailed description of how the fair market value was determined (e.g., appraisal);

h. For leases of real property, the fair market rental value, a detailed description of how the fair market rental value was determined, and any additional information necessary to show compliance with Rule 3 (g) above;

i. For easements or rights-of-way, the fair market value of the easement or right-of-way and a detailed description of how the fair market value was determined;

j. A complete description of any recent past (within the prior two years) or anticipated future transactions that may appear to be related to the present transaction, such as sales or leases of interests in the same real property or real property that is located near the property at issue or that are being transferred to the same transferee; or for depreciable assets, sales of the same or similar assets or sales to the same transferee;

k. Sufficient information and documentation (including environmental documentation) to show that all of the eligibility criteria stated in Rule 3 above have been met;

l. The filing utility may submit additional information to assist in the review of the advice letter, including recent photographs, scaled maps, drawings, etc;

m. Environmental Information:

(1) If the Applicant Believes that the Transaction is Exempt from Review under CEQA. If the applicant believes that the transaction is exempt from environmental review under a statutory or categorical exemption from CEQA, the applicant shall provide the following information:

(2) If the Applicant Believes that the Transaction is not a Project under CEQA. If the applicant believes that the transaction is not a project under CEQA, the applicant shall include an explanation of its position.

(3) If another Public Agency, Acting as the Lead Agency, has Completed Environmental Review of the Project and the Applicant Believes that the Commission is a Responsible Agency under CEQA. If another public agency, acting as the Lead Agency under CEQA, has completed an environmental review of the project and has approved the final CEQA documents, and the Commission is a Responsible Agency under CEQA, the applicant shall submit the following information to the Commission Energy Division staff handling CEQA issues:

Rule 5. Notice and Service of Advice Letters

Notification and service of the advice letter shall be made in accordance with GO 96-B or its successor regulation. In all cases, the advice letter shall be noticed in the Commission's Daily Calendar. A copy of the advice letter shall be served on the appropriate Industry Division, the Commission Division of Ratepayer Advocates (DRA), the Commission Energy Division staff handling CEQA issues, the relevant departments of the city and county in which any real property involved in a transaction is located, and persons and organizations on the utility's advice letter service list, as required by GO 96-B or its successor regulation. If the CEQA documents filed with the advice letter pursuant to Rule 4. (m) above exceed 15 pages in length, the regulated utility may serve a notice of availability for the CEQA documents, in lieu of the CEQA documents themselves, on persons and organizations on the utility's advice letter service list, except that a full copy of the CEQA documents shall be served on the appropriate Commission Industry Division, DRA, the Commission Energy Division staff handling CEQA issues, and the relevant departments of the city and county in which any real property involved in the transaction is located (unless the city or county prepared the CEQA documents as the Lead Agency under CEQA.)

Rule 6. Protests to Advice Letters

a. Protests to an advice letter shall be filed with the appropriate Industry Division and served on the utility within 20 days of the filing of the advice letter. All protests and replies shall comply with the requirements of GO 96-B or its successor regulation.

b. All protests shall be processed and addressed pursuant to the procedures stated in GO 96-B or its successor regulation.

Rule 7. Review Process for Advice Letters

a. Industry Division Review

(1) Submittal of Advice Letters: Advice letter filings that are eligible for filing pursuant to this GO shall be submitted to the appropriate Industry Division for processing.

(2) Initial 30-Day Review Period: The filing of an advice letter triggers a 30-day review period by the appropriate Industry Division. At the end of the initial 30-day review period, Industry Division staff shall notify the utility that the advice letter has been automatically suspended pursuant to General Rule 7.5.2 of GO 96-B or a successor regulation (unless the advice letter has already been rejected or approved). Industry Division staff may also notify the utility that additional information or documentation is required.

(3) Grounds for Rejection of Advice Letter by Appropriate Industry Division: For any of the following reasons, the appropriate Industry Division may determine that the approval of an advice letter filing under this GO is inappropriate:

(a) The proposed transaction does not satisfy the criteria for this GO;

(b) The proposed transaction presents unusual issues of fact or law that require more complete fact-finding and informed decision-making, or otherwise warrants a more comprehensive review;

(c) The proposed transaction is inappropriate for advice letter consideration because such consideration is otherwise barred by GO 96-B or its successor regulation;

(d) The monetary value of the transaction will materially impact the ratebase of the utility (except when the applicant is a telecommunications corporation subject to the Uniform Regulatory Frame (URF) or which is not subject to rate of return regulation);

(e) The transaction involves the division of a single asset that the utility proposes to transfer into smaller parts valued at less than $5 million in order to avoid a formal application under Section 851;

(f) The transaction warrants a more comprehensive review or may require an evidentiary hearing based on issues raised in a timely protest; and

(g) The utility has failed to respond in a timely manner to a request by the appropriate Industry Division for additional information or documentation.

(4) Rejection of Advice Letter by Appropriate Industry Division: Having stated the reasons for determining that an advice letter filing is inappropriate for this GO program in writing, the appropriate Industry Division may reject the advice letter pursuant to GO 96-B or its successor regulation, without prejudice to the applicant to refile the request as a formal application. In the case of a rejection pursuant to Rule 7. a. (3) (g) above or its successor regulation (due to the utility's failure to respond to a request from the appropriate Industry Division for additional information or documentation), the rejection may be without prejudice to the refiling of the advice letter accompanied by the necessary information or documentation.

(5) Executive Director/Division Director Disposition of Advice Letter: If an unprotested advice letter is not rejected for any of the reasons stated above, and does not require environmental review by the Commission as a Responsible Agency under CEQA, the Executive Director or the Director of the appropriate Commission Industry Division may issue a disposition letter, which either grants, modifies, or denies the advice letter. The disposition letter shall include a supporting analysis by the Industry Division. A copy of the disposition letter shall be served on all persons on whom the advice letter application was served, and the results of the disposition letter shall be posted on the Commission website. In the alternative, the appropriate Industry Division may prepare a resolution which recommends approving, modifying, or denying the advice letter, for consideration by the Commission at a business meeting.

(6) Preparation of Commission Resolution for Transactions in which the Commission is a Responsible Agency under CEQA. If an advice letter is not rejected for the reasons stated above, and requires environmental review by the Commission as a Responsible Agency under CEQA, the appropriate Industry Division shall prepare a resolution for consideration by the Commission at a business meeting. The Resolution shall recommend granting, denying, or modifying the advice letter and shall include the recommendation of the Industry Division and a supporting analysis. In cases in which the appropriate Industry Division recommends approval or modification of the project, the Resolution shall include the appropriate findings under CEQA.

Rule 8. Timeframe for Commission Action on Advice Letter

Unless a timely protest has been filed or an advice letter contains incomplete information, as determined by the appropriate Industry Division, the Commission or in appropriate cases, the Executive Director or Director of the appropriate Industry Division, shall act upon the advice letter by no later than 120 days after its filing, by either approving, modifying, or denying the advice letter.

Rule 9. Appeal or Review of Commission Action on Advice Letters

Rule 9.1. Appeal or Review of Commission Resolutions Regarding Advice Letters

Commission resolutions granting, modifying, or denying advice letters may be reviewed or reconsidered through timely filed applications for rehearing or in appropriate circumstances, petitions for modification, as authorized in GO 96-B or its successor regulation and the Commission Rules of Practice and Procedure.

Rule 9.2. Appeal or Review of Executive Director or Industry Division Action on Advice Letters

The utility, persons, or entities that filed a protest to the advice letter, or other persons or entities (to the extent authorized by GO 96-B or its successor regulation) may request Commission review of the Executive Director's or Industry Division's disposition of an advice letter, pursuant to GO 96-B, General Rule 7.7.1 (or a successor regulation).

Rule 10. Annual Report Regarding Advice Letters Filed by Each Utility

Each utility that has filed one or more advice letters shall submit an annual list of advice letters filed to the appropriate Industry Division by no later than April 1 of each year, commencing on April 1, 2010. The first list filed pursuant to this provision shall include all advice letters filed between 2005, the year in which the Section 851 pilot program began, and the date of the list's submission. Subsequent lists shall only include advice letters filed during the preceding year. Each list shall include the following: a) the name of the utility, b) the advice letter number, c) the date on which the advice letter was filed, d) a short summary of each advice letter filed, e) the date on which the advice letter was approved or denied, and f) if the advice letter was not approved, a brief statement of the reason.

(END OF APPENDIX A)

APPENDIX B

SUMMARY OF COMMENTS FROM
INTERESTED PARTIES ON SECTION 851 PILOT PROGRAM

A. Opening Comments

Pacific Gas and Electric Company (PG&E):

PacifiCorp:

San Diego Gas & Electric Company/Southern California Gas Company (SDG&E/SoCalGas):

Southern California Edison Company (SCE):

Southwest Gas Corporation (SW Gas):

The Small LECs:

B. Reply Comments

A summary of the reply comments follows:

The Commission Division of Ratepayer Advocates (DRA):

PG&E:

o Adopting a general guideline that the ability to readily remove any third party facilities from utility property within a 90-day revocability period qualifies the transaction as a "limited use" under GO 69-C;

o Formally adopting the proposed list of transactions that should be considered exempt from Section 851 pursuant to GO 69-C, attached to the Commission's workshop report in Decision (D.) 05-04-055;

o Expressly stating that the Commission will allow utilities to reasonably use their discretion in applying the GO 69-C exemption to particular transactions, without fear of the imposition of a penalty by the Commission, if the Commission later finds that the transaction was subject to Section 851. PG&E recommends that if the utility enters into a transaction without seeking Section 851 approval pursuant to GO 69-C, the utility should be entitled to a presumption of good faith if the Commission later decides to review the applicability of GO 69-C. If the Commission finds that GO 69-C did not apply, the utility should not be subject to a penalty unless the Commission finds that the utility acted in bad faith. "Bad faith" should be defined to mean that there was no reasonable basis for the utility to believe that the transaction falls under GO 69-C.

PacifiCorp:

SCE:

The Small LECs:

(END OF APPENDIX B)

APPENDIX C

UPDATED SERVICE LIST FOR
RESOLUTION ALJ-268

Please serve Assistant Chief ALJ Janet A. Econome, jjj@cpuc.ca.gov, ALJ Myra J. Prestidge, tom@cpuc.ca.gov, and Andrew Barnsdale, bca@cpuc.ca.gov, as well as the following service list:

R.98-07-038

http://www.cpuc.ca.gov/published/service_lists/R9807038_2198.htm

P.02-02-003

(See attached service list.)

R.04-09-003

http://www.cpuc.ca.gov/published/service_lists/R0409003_66288.htm

R.05-04-005

http://www.cpuc.ca.gov/published/service_lists/R0504005_68617.htm

R.06-02-012

http://www.cpuc.ca.gov/published/service_lists/R0602012_72126.htm

R.06-12-016

http://www.cpuc.ca.gov/published/service_lists/R0612016_75168.htm

A.08-02-001

http://www.cpuc.ca.gov/published/service_lists/A0802001_76153.htm

R.08-02-007

http://www.cpuc.ca.gov/published/service_lists/R0802007_76232.htm

A.09-05-026

http://www.cpuc.ca.gov/published/service_lists/A0905026_78405.htm

R.09-06-019

http://www.cpuc.ca.gov/published/service_lists/R0906019_78410.htm

Rebecca W. Giles
Regulatory Case Administrator
SDG&E and SoCalGas
8330 Century Park Court, CP32D
San Diego, CA 92123
ph. (858) 636-6876

RGiles@semprautilities.com

(END OF APPENDIX C)

INFORMATION REGARDING SERVICE

I have provided notification of the foregoing Draft Resolution ALJ-268 to the electronic mail addresses on the attached service lists, as well as a Notice of Availability by U.S. mail. I have served a hard copy of the foregoing Draft Resolution ALJ-268 by U.S. mail on those persons on the attached service lists that do not have e-mail addresses.

Dated May 8, 2012, at San Francisco, California.

UPDATED SERVICE LIST FOR
RESOLUTION ALJ-268

Please serve Assistant Chief ALJ Janet A. Econome, jjj@cpuc.ca.gov, ALJ Myra J. Prestidge, tom@cpuc.ca.gov, and Andrew Barnsdale, bca@cpuc.ca.gov, as well as the following service list:

R.98-07-038

http://www.cpuc.ca.gov/published/service_lists/R9807038_2198.htm

P.02-02-003

(See attached service list.)

R.04-09-003

http://www.cpuc.ca.gov/published/service_lists/R0409003_66288.htm

R.05-04-005

http://www.cpuc.ca.gov/published/service_lists/R0504005_68617.htm

R.06-02-012

http://www.cpuc.ca.gov/published/service_lists/R0602012_72126.htm

R.06-12-016

http://www.cpuc.ca.gov/published/service_lists/R0612016_75168.htm

A.08-02-001

http://www.cpuc.ca.gov/published/service_lists/A0802001_76153.htm

R.08-02-007

http://www.cpuc.ca.gov/published/service_lists/R0802007_76232.htm

A.09-05-026

http://www.cpuc.ca.gov/published/service_lists/A0905026_78405.htm

R.09-06-019

http://www.cpuc.ca.gov/published/service_lists/R0906019_78410.htm

Rebecca W. Giles
Regulatory Case Administrator
SDG&E and SoCalGas
8330 Century Park Court, CP32D
San Diego, CA 92123
ph. (858) 636-6876

RGiles@semprautilities.com

************** PARTIES **************

Dorothy Connelly
Director, Government Relations
AIRTOUCH COMMUNICATIONS, INC.
2999 OAK RD 5
WALNUT CREEK CA 94597-2066
(415) 658-2063

Michele F. Joy
General Counsel
ASSOCIATION OF OIL PIPE LINES
1808 I ST NW STE 300
WASHINGTON DC 20006-5423
(202) 408-7970
For: ASSOCIATION OF OIL PIPE LINES ____________________________________________

Reed V. Schmidt
Vice President
BARTLE WELLS ASSOCIATES
1889 ALCATRAZ AVENUE
BERKELEY CA 94703
(510) 653-3399
rschmidt@bartlewells.com


Thomas Eckhart
CAL - UCONS, INC.
10612 NE 46TH STREET
KIRKLAND WA 98033
(425) 576-5409
tom@ucons.com


Lesla Lehtonen
Staff Attorney
CALIFORNIA CABLE TELEVISION ASSN.
1001 K STREET, 2ND FLOOR
SACRAMENTO CA 95814-3832
(916) 446-7732
lesla@calcable.org


Richard J. Balocco
President
CALIFORNIA WATER ASSOCIATION
374 W. SANTA CLARA STREET
SAN JOSE CA 95196
(408) 279-7860

Nikayla K. Nail Thomas
Executive Director
CALTEL
515 S. FLOWER STREET, 47/F
LOS ANGELES CA 90071
(213) 213-3740
nnail@caltel.org




Robert Green
Joint Venture & Regulatory Specialist
CHEVRON PIPE LINE COMPANY
2811 HAYES RD., RM 2336R
HOUSTON TX 77082
(281) 596-3518
rgre@chevron.com


Heidi Sieck Williamson
Dept Of Telecommunications & Information
CITY & COUNTY OF SAN FRANCISCO
875 STEVENSON STREET, 5TH FLOOR
SAN FRANCISCO CA 94103
(415) 554-0811
heidi_sieck-williamson@ci.sf.ca.us


Jeffrey F. Beck
JILLISA BRONFMAN
Attorney At Law
COOPER, WHITE & COOPER ,L.L.P.
201 CALIFORNIA ST., 17TH FLOOR
SAN FRANCISCO CA 94111
(415) 433-1900
smalllecs@cwclaw.com

For: Evans/GTE West Coast/Happy Valley/Hornitos/Kerman/Pinnacles/Siskiyou/Volcano/Winterhaven ____________________________________________

Patrick M. Rosvall
COOPER, WHITE & COOPER LLP
201 CALIFORNIA STREET, 17TH FLOOR
SAN FRANCISCO CA 94111
(415) 433-1900
prosvall@cwclaw.com

For: Roseville Tel/Calaveras/Cal-Ore/Ducor/Foresthill/Ponderosa ____________________________________________

Thomas A. Doub
Division of Ratepayer Advocates
RM. 4205
505 Van Ness Avenue
San Francisco CA 94102 3298
(415) 355-4999
tad@cpuc.ca.gov


Andrew Brown
Attorney At Law
ELLISON SCHNEIDER & HARRIS LLP
2600 CAPITOL AVENUE, SUITE 400
SACRAMENTO CA 95816-5905
(916) 447-2166
abb@eslawfirm.com

For: CA Department of General Services ____________________________________________





Charles E. Born
Manager - Government & External Affairs
FRONTIER TELECOMMUNICATIONS OF CALIF.
9260 E. STOCKTON BLVD.
ELK GROVE CA 95624
(916) 686-3570
Charlie.Born@ftr.com


James D. Squeri
KATHRYN A. FUGERE
Attorney At Law
GOODIN, MACBRIDE, SQUERI, DAY & LAMPREY
505 SANSOME STREET, SUITE 900
SAN FRANCISCO CA 94111
(415) 392-7900
jsqueri@goodinmacbride.com

For: CA Assn of Competitive Telecommunications Carriers ____________________________________________

Cheryl Hills
ICG COMMUNICATIONS, INC.
620 3RD ST
SAN FRANCISCO CA 94107-1902
(510) 239-7201
cheryl.hills@icg.com


Doug Garrett
Senior Director, Government Affairs
ICG COMMUNICATIONS, INC.
2200 POWELL STREET, SUITE 1035
EMERYVILLE CA 94608
(510) 239-7089
doug_garrett@icgcomm.com


Peter M. Dito
KINDER MORGAN ENERGY PARTNERS
1100 TOWN AND COUNTRY ROAD
ORANGE CA 92868
DitoP@kindermorgan.com


Earl Nicholas Selby
LAW OFFICES OF EARL NICHOLAS SELBY
530 LYTTON AVENUE, 2ND FLOOR
PALO ALTO CA 94301-1705
(650) 323-0990
selbytelecom@gmail.com


Arthur D. Levy
639 FRONT STREET, 4TH FLOOR
SAN FRANCISCO CA 94111
(415) 433-4949
adl@lrolaw.com


Lenard G. Weiss
ANNE MARIE MURPHY
Attorney At Law
MANATT, PHELPS & PHILLIPS, LLP
ONE EMBARCADERO CENTER, 30TH FLOOR
SAN FRANCISCO CA 94111
(415) 291-7460
lweiss@manatt.com

For: California-American Water Company ____________________________________________

Phuong N. Pham
MORRISON & FOERSTER
425 MARKET STREET
SAN FRANCISCO CA 94105
(415) 291-1970
ppham@mofo.com


Mary E. Wand
Attorney At Law
MORRISON & FOERSTER LLP
425 MARKET STREET
SAN FRANCISCO CA 94105
(415) 268-7201
mwand@mofo.com


Martin A. Mattes
NOSSAMAN, LLP
50 CALIFORNIA STREET, 34TH FLOOR
SAN FRANCISCO CA 94111-4799
(415) 398-3600
mmattes@nossaman.com

For: California Payphone Association ____________________________________________

Diane I. Fellman
NRG WEST
EMAIL ONLY
EMAIL ONLY CA 00000
(415) 665-3824
Diane.Fellman@nrgenergy.com


David Discher
Attorney At Law
PACIFIC BELL TELEPHONE COMPANY
525 MARKET STREET, RM. 2027
SAN FRANCISCO CA 94105
(415) 778-1464
david.discher@att.com











Ann H. Kim
PACIFIC GAS AND ELECTRIC COMPANY
LAW DEPT
77 BEALE STREET, RM 3105 / PO BOX 7442
SAN FRANCISCO CA 94120
(415) 973-7467
AHK4@pge.com


John P. Clarke
PACIFIC GAS AND ELECTRIC COMPANY
77 BEALE STREET, MCB10C
SAN FRANCISCO CA 94105
(415) 973-3652

Michelle Wilson
SHIRLEY A. WOO/CHONDA J. NWAMU
Attorney At Law
PACIFIC GAS AND ELECTRIC COMPANY
PO BOX 7442
SAN FRANCISCO CA 94120
(415) 973-6650
mlw3@pge.com

For: Pacific Gas and Electric Company ____________________________________________

Peter Van Mieghem
Attorney At Law
PACIFIC GAS AND ELECTRIC COMPANY
PO BOX 7442
SAN FRANCISCO CA 94120
(415) 973-2902
ppv1@pge.com

For: PACIFIC GAS AND ELECTRIC COMPANY ____________________________________________

Peter A. Casciato
Attorney At Law
PETER A. CASCIATO P.C.
355 BRYANT STREET, SUITE 410
SAN FRANCISCO CA 94107
(415) 291-8661
pacasciato@gmail.com

For: Time Warner Connect/NorthPoint Communications, Inc./Central Wireless Partnership ____________________________________________

Mark Fogelman
LORI ANNE DOLQUEIST
REED SMITH LLP
SUITE 2000
TWO EMBARCADERO CENTER
SAN FRANCISCO CA 94111
(415) 543-8700
mfogelman@reedsmith.com

For: Pacific Gas and Electric Company ____________________________________________


Marco Gomez
Attorney At Law
S.F. BAY AREA RAPID TRANSIT
PO BOX 12688
OAKLAND CA 94604-2688
(510) 464-6058
mgomez1@bart.gov


Paul A. Szymanski
Sr. Counsel
SAN DIEGO GAS & ELECTRIC COMPANY
101 ASH STREET HQ 12
SAN DIEGO CA 92101-3017
(619) 699-5078
PSzymanski@SempraUtilities.com

For: Sempra Energy Utilities/San Diego Gas & Electric/Southern California Gas ____________________________________________

Palle Jensen
Director Of Regulatory Affairs
SAN JOSE WATER COMPANY
374 WEST SANTA CLARA STREET
SAN JOSE CA 95196
(408) 279-7970
palle_jensen@sjwater.com


Jadine Louie
Regulatory Services, Assoc Dir.
SBC CALIFORNIA
525 MARKET ST., 19FL, 7
SAN FRANCISCO CA 94105
(415) 778-1461
jadine.louie@att.com

For: SBC CALIFORNIA ____________________________________________

David A. Simpson
SIMPSON PARTNERS
900 FRONT STREET
SAN FRANCISCO CA 94111
(415) 773-1790
david@simpsonpartners.com


Thomas K. Braun
STEPHEN E. PICKETT
SOUTHERN CALIFORNIA EDISON CO.
2244 WALNUT GROVE AVE., 1, RM 360
ROSEMEAD CA 91770
(818) 302-4413
thomas.k.braun@sce.com









Michael A. Backstrom
Attorney At Law
SOUTHERN CALIFORNIA EDISON COMPANY
2244 WALNUT GROVE AVENUE
ROSEMEAD CA 91770
(626) 302-1903
michael.backstrom@sce.com

For: SOUTHERN CALIFORNIA EDISON COMPANY ____________________________________________

Richard Tom
SOUTHERN CALIFORNIA EDISON COMPANY
PO BOX 800, 2244 WALNUT GROVE AVE.
ROSEMEAD CA 91770
(626) 302-4430
richard.tom@sce.com

For: Southern California Edison Company ____________________________________________

Edward B. Gieseking
Director/Pricing And Tariffs
SOUTHWEST GAS CORPORATION
5241 SPRING MOUNTAIN ROAD
LAS VEGAS NV 89150
(702) 364-3271
ed.gieseking@swgas.com


Valerie J. Ontiveroz
SOUTHWEST GAS CORPORATION
5241 SPRING MOUNTAIN ROAD
LAS VEGAS NV 89193-8510
(702) 876-7323
valerie.ontiveroz@swgas.com


Stephen H. Kukta
Counsel
SPRINT NEXTEL
201 MISSION STREET, STE. 1500
SAN FRANCISCO CA 94105
(415) 572-8358
stephen.h.kukta@sprint.com


Andrew O. Isar
Director, Industry Relations
TELECOMMUNICATIONS RESELLERS ASSN.
4423 POINT FOSDICK DR., NW, STE. 306
GIG HARBOR WA 98335
(253) 265-3910
aisar@millerisar.com


Marcel Hawiger
CHRISTINE MAILLOUX
THE UTILITY REFORM NETWORK
115 SANSOME STREET, SUITE 900
SAN FRANCISCO CA 94104
(415) 929-8876 X302
marcel@turn.org


Cecil O. Simpson, Jr.
US ARMY LEGAL SERVICES AGENCY
901 NORTH STUART STREET, SUITE 713
ARLINGTON VA 22203-1837
(703) 696-1643
For: Department of Defense/Federal Executive Agencies ____________________________________________

Greg Milleman
Vp - Admin
VALENCIA WATER COMPANY
24631 AVENUE ROCKEFELLER
VALENCIA CA 91355
(661) 294-0828
gmilleman@valenciawater.com


Lupita Reyes
VERIZON CALIFORNIA, INC.
MAIL CODE HQE02F69
600 HIDDEN RIDGE
IRVING TX 75038
(972) 718-6744
lupita.reyes@verizon.com


Sheila Dey
Executive Director
WESTERN MANUFACTURED HOUSING COMMUNITIES
455 CAPITAL MALL STE 800
SACRAMENTO CA 95814
(916) 448-7002
sheila@wma.org


Jerry R. Bloom
Attorney At Law
WINSTON & STRAWN LLP
333 SOUTH GRAND AVENUE, 38TH FLOOR
LOS ANGELES CA 90071-1543
(213) 615-1756
jbloom@winston.com

For: California Cogeneration Council ____________________________________________











********** STATE EMPLOYEE ***********

Natalie Billingsley
Division of Ratepayer Advocates
RM. 4209
505 Van Ness Avenue
San Francisco CA 94102 3298
(415) 703-1368
nxb@cpuc.ca.gov


Cherrie Conner
Communications Division
AREA 3-D
505 Van Ness Avenue
San Francisco CA 94102 3298
(415) 703-2767
chr@cpuc.ca.gov


Fred L. Curry 5
Division of Water and Audits
RM. 3106
505 Van Ness Avenue
San Francisco CA 94102 3298
(415) 703-1739
flc@cpuc.ca.gov


Phillip Enis
Consumer Service & Information Division
RM. 2101
505 Van Ness Avenue
San Francisco CA 94102 3298
(415) 703-4112
pje@cpuc.ca.gov


Richard Fish
Communications Division
AREA 3-D
505 Van Ness Avenue
San Francisco CA 94102 3298
(415) 703-1923
rff@cpuc.ca.gov


Steven Kotz
Administrative Law Judge Division
RM. 5101
505 Van Ness Avenue
San Francisco CA 94102 3298
(415) 703-2437
kot@cpuc.ca.gov


Donald J. Lafrenz
Energy Division
AREA 4-A
505 Van Ness Avenue
San Francisco CA 94102 3298
(415) 703-1063
dlf@cpuc.ca.gov


Fe N. Lazaro
Communications Division
AREA 3-D
505 Van Ness Avenue
San Francisco CA 94102 3298
(415) 703-2627
fnl@cpuc.ca.gov


Jeorge S. Tagnipes
Energy Division
AREA 4-A
505 Van Ness Avenue
San Francisco CA 94102 3298
(415) 703-2451
jst@cpuc.ca.gov


John E. Thorson
Administrative Law Judge Division
505 Van Ness Avenue
San Francisco CA 94102 3298
(415) 355-5568
jet@cpuc.ca.gov


Robert J. Wullenjohn
Communications Division
RM. 3210
505 Van Ness Avenue
San Francisco CA 94102 3298
(415) 703-2265
rw1@cpuc.ca.gov


********* INFORMATION ONLY **********


Cindy Manheim
CINGULAR WIRELESS
PO BOX 97061
REDMOND WA 98073-9761
(425) 580-8112
cindy.manheim@cingular.com


Steve Lafond
Public Utilities Department
CITY OF RIVERSIDE
2911 ADAMS STREET
RIVERSIDE CA 92504
(909) 351-6344
slafond@ci.riverside.ca.us





Mark P. Schreiber
COOPER, WHITE & COOPER, LLP
201 CALIFORNIA STREET, 17TH FLOOR
SAN FRANCISCO CA 94111
(415) 765-6228
mschreiber@cwclaw.com

For: Rosevile Telephone Company ____________________________________________

Judy Pau
DAVIS WRIGHT TREMAINE LLP
EMAIL ONLY
EMAIL ONLY CA 00000-0000
(415) 276-6587
judypau@dwt.com


Suzanne Toller
Attorney At Law
DAVIS WRIGHT TREMAINE, LLP
505 MONTGOMERY STREET, SUITE 800
SAN FRANCISCO CA 94111-6533
(415) 276-6536
suzannetoller@dwt.com


Daniel W. Douglass
DOUGLASS & LIDDELL
EMAIL ONLY
EMAIL ONLY CA 00000
(818) 961-3001
douglass@energyattorney.com

For: VARTEC TELCOM, INC. ____________________________________________

Anita Taff-Rice
EXTENET SYSTEMS, LLC
1547 PALOS VERDES MALL, NO. 298
WALNUT CREEK CA 94597
(415) 699-7885
anitataffrice@earthlink.net


Lou Filipovich
15376 LAVERNE DRIVE
SAN LEANDRO CA 94579
(510) 357-0555

Phyllis A. Whitten
FRONTIER COMMUNICATIONS
9260 E. STOCKTON BLVD.
ELK GROVE CA 95624
(916) 686-3117
Phyllis.Whitten@ftr.com


Donald M. Johnson
Chief Operating Officer
FULL POWER CORPORATION
2130 WATERS EDGE DR.
WESTLAKE OH 44135-6602
(310) 258-0488
fpc_ca@pacbell.net


Norman A. Pedersen
Attorney At Law
HANNA AND MORTON, LLP
444 SOUTH FLOWER STREET, NO. 1500
LOS ANGELES CA 90071-2916
(213) 430-2510
npedersen@hanmor.com


Frances Yee
PACIFIC GAS AND ELECTRIC COMPANY
77 BEALE STREET, MC B15A
SAN FRANCISCO CA 94105
(415) 973-6057
FSC2@pge.com

For: PACIFIC GAS AND ELECTRIC COMPANY ____________________________________________

June Ruckman
PACIFIC GAS AND ELECTRIC COMPANY
77 BEALE STREET, MC B8R
SAN FRANCISCO CA 94105
(415) 972-5266
jcr4@pge.com

For: PACIFIC GAS AND ELECTRIC COMPANY ____________________________________________

Regulatory File Room
PACIFIC GAS AND ELECTRIC COMPANY
PO BOX 7442
SAN FRANCISCO CA 94120
(415) 973-4295
CPUCCases@pge.com


Roxanne Piccillo
PACIFIC GAS AND ELECTRIC COMPANY
77 BEALE STREET, B10A
SAN FRANCISCO CA 94105
(415) 973-6593
rtp1@pge.com

For: PACIFIC GAS AND ELECTRIC COMPANY ____________________________________________











Regulatory Affairs
SAN DIEGO GAS & ELECTRIC CO.
8330 CENTURY PARK COURT-CP31E
SAN DIEGO CA 92123-1530
(858) 654-1766
CentralFiles@SempraUtilities.com


Keith Melville
SAN DIEGO GAS & ELECTRIC COMPANY
101 ASH STREET, HQ 13D
SAN DIEGO CA 92101
(619) 699-5039
KMelville@SempraUtilities.com


Amy Peters
SAN DIEGO GAS AND ELECTRIC COMPANY
8330 CENTURY PARK COURT, CP32D
SAN DIEGO CA 92009
(858) 654-1796
APeters@SempraUtilities.com


Joann Rice
Regulatory Manager
SBC LONG DISTANCE
5130 HACIENDA DR FL 1
DUBLIN CA 94569-7598
(925) 468-6006

Robbie Ralph
Director, Economic Regulation & Tariff
SHELL CALIFORNIA PIPELINE COMPANY LLC
PO BOX 2648
HOUSTON TX 77252-2648
(713) 241-3676
robbie.ralph@shell.com

For: SHELL CALIFORNIA PIPELINE COMPAMY LLC ____________________________________________

Case Administration
Law Department
SOUTHERN CALIFORNIA EDISON COMPANY
2244 WALNUT GROVE AVENUE
ROSEMEAD CA 91770
(626) 302-4875
case.admin@sce.com


Case Administration
SOUTHERN CALIFORNIA EDISON COMPANY
2244 WALNUT GROVE AVE. / PO BOX 800
ROSEMEAD CA 91770
(626) 302-4875
case.admin@sce.com

For: SOUTHERN CALIFORNIA EDISON COMPANY ____________________________________________


Christine A. Mailloux
Attorney At Law
THE UTILITY REFORM NETWORK
115 SANSOME STREET, SUITE 900
SAN FRANCISCO CA 94104
(858) 558-7930
cmailloux@turn.org


Margaret L. Tobias
TOBIAS LAW OFFICE
460 PENNSYLVANIA AVENUE
SAN FRANCISCO CA 94107
(415) 641-7833
info@tobiaslo.com


Jacque Lopez
VERIZON CALIFORNIA INC.
2535 W. HILLCREST DR., MC CAM21LB
NEWBURY PARK CA 91320
(805) 499-6179
jacque.lopez@verizon.com


Rex Knowles
Regional Vice President
XO COMMUNICATIONS SERVICES, INC.
7050 UNION PARK AVE., STE. 400
MIDVALE UT 84047-6070
(801) 983-1504
rex.knowles@xo.com


1 The Commission originally adopted the pilot program in August 2005 in Resolution
ALJ-186, and amended the pilot program in Resolution ALJ-202 in August 2007.

2 All subsequent Code references are to the Public Utilities Code, unless otherwise stated.

3 Exceptions to this requirement apply if the Commission exempts a utility, class of utility, transaction, or class of transactions from the requirements of Section 851 pursuant to Section 853(b), including whether the particular transaction meets the criteria stated in General Order (GO) 69-C.

4 Under Section 851, the utilities must still file formal Section 851 applications to obtain Commission approval of transactions valued at over $5 million.

5 The then-current version of Section 853(d) stated:

(d) It is the intent of the Legislature that transactions with monetary values that materially impact a public utility's rate base should not qualify for expedited advice letter treatment pursuant to this article. It is the further intent of the Legislature that the commission maintain all of its oversight and review responsibilities subject to the California Environmental Quality Act, and that public utility transactions that jurisdictionally trigger a review under the act should not qualify for expedited advice letter treatment pursuant to this article.

6 GO 96-B sets forth procedures governing the processing of advice letters filed with the Commission in general.

7 Under GO 96-B, advice letters which require approval by a vote of the full Commission are Tier 3 advice letters.

8 We reasoned that any transaction subject to Section 851 which requires CEQA review by the Commission as either the Lead Agency or a Responsible Agency "jurisdictionally triggers" the Commission's oversight and review responsibilities under CEQA and therefore does not qualify for advice letter treatment pursuant to Section 853(d). We noted that even when acting as a Responsible Agency, the Commission has significant duties under CEQA. For example, as a Responsible Agency, the Commission must review the environmental documents prepared by the Lead Agency and make its own findings regarding whether the transaction will have significant environmental impacts, and whether these impacts can be mitigated. State CEQA Guidelines Sections 15096(f) and (h). The Commission may also require additional mitigation measures for significant adverse environmental impacts related to aspects of the project that the Commission decides to carry out, finance, or approve. State CEQA Guidelines Section 15096(g).

9 Based on the plain language of the statute, we interpreted the first sentence of Section 853(d) to mean that if a particular transaction is valued at $5 million or less but still materially impacts the ratebase of a utility, the transaction does not qualify for review through an advice letter, and the utility must file a formal Section 851 application in order to obtain Commission approval of the transaction.

10 Section 851, as amended by AB 698, states that: "If the advice letter is uncontested, approval may be given by the executive director or the director of the division of the commission having regulatory jurisdiction over the utility." Under the principles of statutory construction, "may" is generally interpreted as permissive language, which does not impose a mandatory obligation. Therefore, we believe that the Commission had discretion to determine whether or not to grant this authority to the Executive Director and/or the appropriate Division Director.

11 Section 853(d), as amended by AB 698 states:

(d) It is the intent of the Legislature that transactions with monetary values that materially impact a public utility's rate base should not qualify for expedited advice letter treatment pursuant to this article. It is the further intent of the Legislature that the commission maintain all of its oversight and review responsibilities subject to the California Environmental Quality Act, and that public utility transactions that jurisdictionally require a review by the commission, as the lead agency, under the act should not qualify for expedited advice letter treatment pursuant to this article. An advice letter may be filed for transactions by the public utility if the lead agency has completed the appropriate review under the California Environmental Quality Act for the transaction, and the commission is the responsible agency under the act. The advice letter shall be subject to approval by resolution voted upon by the commission.

12 Resolution ALJ-244 specified that our amended pilot program regulations did not apply to transactions involving the transfer of property interests in the Pacific Gas and Electric Company (PG&E) watershed lands to the extent that these transactions were subject to the procedures approved in Decision (D.) 08-11-043. D.08-11-043 has now been modified by D.10-08-004, so that transactions involving the PG&E watershed lands that are subject to Section 851 may be approved by advice letter under specified circumstances. That Resolution also noted that the Commission's decision in Rulemaking (R.) 09-05-006 could affect the applicability of the pilot program to Uniform Regulatory Framework (URF) carriers and would supersede any conflicting pilot program requirements. D.10-05-019, issued in that docket, granted an exemption from Section 851 to California telecommunications providers subject to the URF for the disposition of certain non-controversial assets, for a period of four years.

13 The Small LECs consist of the following companies: Calaveras Telephone Company, Cal-Ore Telephone Co.; Ducor Telephone Company; Foresthill Telephone Company; Happy Valley Telephone Company; Hornitos Telephone Company; Kerman Telephone Company; Pinnacles Telephone Company; the Ponderosa Telephone Co; Sierra Telephone Company, Inc.; the Siskiyou Telephone Company; Volcano Telephone Company; and Winterhaven Telephone Company.

14 GO 69-C states in pertinent part:

IT IS HEREBY ORDERED, that all public utilities covered by the provisions of Pub. Util. Code Section 851 ... are hereby authorized to grant easements, licenses or permits for use or occupancy on, over or under any portion of the operative property of said utilities for rights of way, private roads, agricultural purposes, or other limited uses of their several properties without further special authorization by this Commission whenever it shall appear that the exercise of such easement, license or permit will not interfere with the operations, practices, and service of such public utilities to and for their several patrons or consumers;

PROVIDED, HOWEVER, that each such grant ... shall be made conditional upon the right of the grantor either upon order of this Commission or upon its own motion to commence or resume the use of the property in question whenever, in the interest of its service to its patrons or consumers, it shall appear necessary or desirable to do so ... "

15 Under GO 69-C, a transaction involving the transfer of a limited use of utility property, such as a license, easement, or permit, may be exempt from Section 851, if three requirements are met: 1) The interest granted must be for a "limited use" of the utility's property, 2) The interest granted must not interfere with the utility's operations, practices, and service to its customers, and 3) The interest granted must be revocable either upon the order of the Commission or upon the utility's own determination that revocation is desirable or necessary to serve its consumers. See D.04-08-048. If these requirements are not met, the utility must apply for advance Commission approval of the transaction pursuant to Section 851.

16 For example, see D.04-10-018, D.04-08-048.

17 For example, see D.01-03-004; D.02-03-059; D.02-10-047.

18 Section 853(b) states:

The commission may from time to time by order or rule, and subject to those terms and conditions as may be prescribed therein, exempt any public utility or class of public utility from this article if it finds that the application thereof with respect to the public utility or class of public utility is not necessary in the public interest. The commission may establish rules or impose requirements deemed necessary to protect the interest of the customers or subscribers of the public utility or class of public utility exempted under this subdivision. These rules or requirements may include, but are not limited to, notification of a proposed sale or transfer of assets or stock and provision for refunds or credits to customers or subscribers.

19 CEQA applies to projects undertaken by parties other than governmental entities only when the public agency is required to make a discretionary decision on the project. Pub. Resources Code Section 2108(a).

20 If a project requires a discretionary permit or other discretionary approval from a local agency or public agency other than the Commission, that public agency may then undertake CEQA review of the project. However, otherwise, the project may be able to proceed without environmental review.

21 The purpose of Commission review pursuant to Section 851 is to ensure that the transaction will not harm the interests of members of the public interested in receiving utility service.

22 Former Pilot Program Regulation II.A.9., stated:

If the transaction involves a transfer or change in ownership of facilities currently used in regulated utility operations, the transaction will not result in a significant physical or operational change in the facility other than in the normal course of business.

23 All Code references are to the Public Utilities Code, unless otherwise stated.

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