Because this proceeding extended over several years, it is useful to summarize the various stages. At a hearing on February 18, 1993, preliminary legal issues were addressed. At a prehearing conference (PHC) on June 1, 1994, the assigned administrative law judge (ALJ) ruled on discovery requests and the parties decided to seek clarification of D.87-09-026. An additional PHC was held on July 19, 1994.

In a Joint Petition dated October 4, 1994, Toro and Cal Utilities joined Castlerock in requesting that I.86-11-019 be reopened for the purpose of modifying D.87-09-026 to clarify Conclusion of Law 12 in regard to circumstances under which utilities might become obligated to refund tax gross-ups on CIAC. Accordingly, the Commission reopened I.86-11-019. This proceeding was in abeyance while the Commission reviewed D.87-09-026.

The Commission issued D.96-10-037 (68 CPUC 2d 469), clarifying D.87-09-026, on October 9, 1996. (This clarification is critical to this case and is discussed at length in Section 4.2, below.) This proceeding resumed with a PHC on July 30, 1997, where evidentiary submissions were discussed. Evidentiary hearings were held on October 21, 1997 and March 3, 1998. Closing briefs were submitted by all parties on June 19, 1998.