Comments on Draft Decision
The draft decision of the ALJ in this matter was mailed to the parties in accordance with Pub. Util. Code § 311(g)(1) and Rule 77.7 of the Rules of Practice and Procedure. Comments were filed on _____________________, and reply comments were filed on ________________.
1. PG&E provides public utility electric service in many areas of California, and in meeting its service obligations over the years has acquired numerous parcels of land which have been used and useful in its provision of service.
2. With the passage of time, PG&E's requirement of full use of some of these parcels has diminished, and PG&E is determining that its present and future requirements on some of these parcels can now and for the future be met by retention of easement rights, while disposing of the basic fee interest in these parcels.
3. By selling unused fee interests in such properties and retaining easements or reservations, the book value of these fee interests can be removed from rate base, enabling PG&E to maintain customer service at reduced costs.
4. The property, consisting of an approximately 0.8 acre parcel located in Gilroy, is land where PG&E has determined that its present and future public utility requirements are capable of being met through use of an easement without the necessity of continued retention of the fee interest in the property or its retention in rate base.
5. PG&E has agreed to sell its fee interest in the property to Buyer, with PG&E retaining an easement sufficient for its present and future utility requirements.
6. A retained easement will adequately protect PG&E's existing and future electric facilities requirements, and removal of fee ownership costs will result in lower costs to both PG&E and its ratepayers; accordingly, the proposed sale and transfer is in the public interest.
7. PG&E's intention is to have shareholders bear any costs associated with the expansion of easements which are not funded by new customers pursuant to applicable tariffs.
8. No change in use or physical change to the environment is proposed as part of the transaction; therefore, based on the record us, the sale of the property does not appear to have the potential to impact the environment.
9. The after-tax gain on the sale will be retained in a memorandum account, pending a Commission decision on the ratemaking treatment.
10. The sale agreement, as written, does not fully protect both PG&E and ratepayers against future environmental related claims.
1. A public hearing is not necessary.
2. The proposed sale and transfer as set forth in the application should be approved.
3. The ratemaking treatment of the gain on sale should be deferred to a future application to be filed by PG&E, as stated above.
4. The sale of the property is a project for CEQA purposes, but the Commission need not perform additional CEQA review based on the record before us.
5. CEQA review is properly deferred to the appropriate state and local authorities having jurisdiction over any proposed changes in use of the property that may occur in the future.
6. Approval of the sale should be conditioned upon Buyer executing and delivering to PG&E a Release and Indemnity Agreement which will ensure that PG&E and the ratepayers are at no risk from any future environmental related claims arising from the sale of the property.
IT IS ORDERED that:
1. Within six months of the effective date of this order, Pacific Gas and Electric Company (PG&E) may sell and transfer to the City of Gilroy and The Gilroy Gang and Drug Abuse Prevention Task Force (Buyer), the property as set forth in Application (A.) 00-03-010, subject to the reservations therein described.
2. Within 30 days of the actual transfer, PG&E shall notify the Commission and the Office of Ratepayer Advocates in writing of the date of which the transfer was consummated. A true copy of the instrument effecting the sale and transfer shall be attached to the written notification.
3. Upon completion of the sale and transfer authorized by this Commission order, PG&E shall stand relieved of public utility responsibilities for the property except as to the reserved easements.
4. The after-tax gain on sale of the property shall be held in a memorandum account pending a decision by the Commission in a future proceeding regarding the ratemaking treatment to be applied to such sales of PG&E nongeneration-related assets.
5. Completion of the sale and transfer authorized by this order shall obligate PG&E's shareholders to bear any costs associated with the expansion of reserved easements which are not funded by new customers pursuant to applicable tariffs.
6. Approval of this sale and transfer is conditional upon Buyer's compliance with all applicable environmental regulations.
7. Approval of this sale is conditioned upon Buyer executing and delivering to PG&E a Release and Indemnity Agreement which will ensure that PG&E and the ratepayers are at no risk from any future environmental related claims arising from the sale of the property.
8. A.00-03-010 is closed.
This order is effective today.
Dated , at San Francisco, California.
