Background

In December 2002, the Greenlining Institute/Latino Issues Forum (G/LIF) filed Petition for Rulemaking (P.) 02-12-039 requesting modifications to GO 77-K regarding the reporting of executive compensation data by utilities. The petition sought to increase the compensation levels that trigger reporting under the general order and to require regulated utilities and their holding companies to disclose executive diversity/ethnicity, compensation and philanthropic contributions in the GO 77 reports. The subject rulemaking closed P.02-12-039 by granting that portion regarding compensation levels that trigger reporting and denying the other portions. The rulemaking scope was limited to three specific issues: (1) should the compensation levels that trigger reporting be increased; (2) should Competitive Local Exchange Carriers (CLECs) and Nondominant Interexchange Carriers (NDIECs) be exempt from the general order; and (3) should utilities be allowed to file information on employee names as confidential under Pub. Util. Code § 583.

As directed in the rulemaking, interested parties filed opening and reply comments in October 2003. On January 30, 2004, Pacific Gas and Electric Company (PG&E) and the Greenlining Institute (Greenlining) filed a joint petition to modify the rulemaking by expanding its scope to additionally require the six Tier 1 utilities operating in California to report holding company executive compensation and to report executive compensation and bonuses awarded but not paid in the reporting year. The petition also requested that these utilities be required to file written verification by an independent auditor on disclosure of these elements and provide an internet site-link to all related documents filed with the SEC.

On March 1, 2004, the five other Tier 1 utilities filed responses opposing the PG&E/Greenlining petition. Generally, the other utilities stated this information is unneeded for the purposes of ratemaking, that holding company executive compensation was addressed and denied in the rulemaking, that executive compensation awarded in the prior year but not yet received was not within the scope of the rulemaking and that most of the requested additional information can be easily obtained from other sources.

Decision (D.) 04-08-055 adopted GO 77-L, superseding GO 77-K with revised rules in the three scoped areas. This decision also granted, in part, the PG&E/Greenlining Petition to modify the rulemaking by expanding its scope and soliciting further comments on the issues of Tier 1 utilities reporting holding company executive compensation and of reporting bonuses awarded but not paid in the reporting year. The decision further states that utilities may redact the individual names of all employees required to report compensation, but not the names of executive officers or attorneys.

On September 22, 2004, the Small Local Exchange Carriers (Small LECs), a party to the proceeding, filed an application for rehearing of D.04-08-055 regarding the issue of confidentiality of employee names arguing that all individual names, including executives and attorneys, should be redacted. In D.05-04-030, we denied rehearing and modified D.04-08-055 to allow utilities to redact, under certain conditions, the names of all individuals, including executives and attorneys, from their GO 77 reports.

On April 21, 2005, three employees of the Small LECs, as individuals, filed a joint petition in the State Court of Appeal, 3rd District, for a stay and writ of review of GO 77-L rules (D.04-08-055 and D.05-04-030) regarding the confidentiality of individual names (Cherniss et al v. Public Utilities Commission, Case No. C049549). The court denied the request to stay on April 22, 2005, and denied the petition for a writ of review on July 28, 2005.