GENERAL PROVISIONS
This act shall be known as the Public Utilities Code.
The provisions of this code, insofar as they are substantially the same as existing statutory provisions relating to the same subject matter, shall be construed as restatements and continuations thereof, and not as new enactments.
No action or proceeding commenced before this code takes effect, and no right accrued, is affected by this code, but all procedure thereafter taken therein shall conform to the provisions of this code so far as possible.
Unless the provision or the context otherwise requires, the definitions, rules of construction, and other general provisions contained in Sections 1 to 22, inclusive, and the definitions in the Public Utilities Act (Chapter 1 (commencing with Section 201) of Part 1 of Division 1), shall govern the construction of this code.
Division, part, chapter, article, and section headings do not in any manner affect the scope, meaning, or intent of the provisions of this code.
Whenever a power is granted to, or a duty is imposed upon, a public officer, the power may be exercised or the duty may be performed by a deputy of the officer or by a person authorized, pursuant to law, by the officer, unless this code expressly provides otherwise.
Writing includes any form of recorded message capable of comprehension by ordinary visual means. Whenever any notice, report, statement, petition, or record is required or authorized by this code, it shall be made in writing in the English language unless it is expressly provided otherwise.
Wherever any notice or other communication is required by this code to be mailed by registered mail by or to any person or corporation, the mailing of such notice or other communication by certified mail shall be deemed to be a sufficient compliance with the requirements of law.
Whenever reference is made to any portion of this code or of any other law of this State, the reference applies to all amendments and additions heretofore or hereafter made.
“Section” means a section of this code unless some other statute is specifically mentioned. “Subdivision” means a subdivision of the section in which that term occurs unless some other section is expressly mentioned.
The present tense includes the past and future tenses, and the future, the present.
The masculine gender includes the feminine and the neuter.
“Spouse” includes “registered domestic partner,” as required by Section 297.5 of the Family Code.
The singular number includes the plural, and the plural, the singular.
“Shall” is mandatory and “may” is permissive.
“Oath” includes affirmation.
“Signature” or “subscription” includes mark when the signer or subscriber cannot write, such signer’s or subscriber’s name being written near the mark by a witness who writes his own name near the signer’s or subscriber’s name; but a signature or subscription by mark can be acknowledged or can serve as a signature or subscription to a sworn statement only when two witnesses so sign their own names thereto.
“State” means the State of California, unless applied to the different parts of the United States. In the latter case, it includes the District of Columbia and the territories.
“County” includes city and county.
“City” includes city and county and “incorporated town,” but does not include “unincorporated town” or “village.”
“Commission” means the Public Utilities Commission created by Section 1 of Article XII of the California Constitution, and “commissioner” means a member of the commission.
“Energy Commission” means the State Energy Resources Conservation and Development Commission.
For the purposes of this code, “recycled water” or “reclaimed water” has the same meaning as recycled water as defined in subdivision (n) of Section 13050 of the Water Code.
If any provision of this code, or the application thereof to any person or circumstance, is held invalid, the remainder of the code, or the application of such provision to other persons or circumstances, shall not be affected thereby.
No corporation formed or existing before 12 o'clock m. of January 1, 1873, is affected by the provisions of Division 4 of this code unless the corporation has elected to continue its existence under the provisions of the Civil Code repealed by this code, or elects to continue its existence under this code, but the laws under which such corporations were formed and exist continue to apply to all such corporations, notwithstanding their repeal by this code or prior to its enactment.
DIVISION 1. REGULATION OF PUBLIC UTILITIES [201. - 3299.100.]
PART 1. PUBLIC UTILITIES ACT [201. - 2120.]
CHAPTER 1. General Provisions and Definitions [201. - 248.]
This part may be cited as the “Public Utilities Act.”
Neither this part nor any provision thereof, except when specifically so stated, shall apply to commerce with foreign nations or to interstate commerce, except insofar as such application is permitted under the Constitution and laws of the United States; but with reference to passenger stage corporations operating in interstate commerce between any point within this State and any point in any other state or in any foreign nation, the commission may prescribe such reasonable, uniform and nondiscriminatory rules in the interest and aid of public health, security, convenience, and general welfare as, in its opinion, are required by public convenience and necessity.
Unless the context otherwise requires, the definitions and general provisions set forth in this chapter govern the construction of this part.
“Corporation” includes a corporation, a company, an association, and a joint stock association.
“Person” includes an individual, a firm, and a copartnership.
As used in this chapter “person” and “corporation” include the lessees, trustees, receivers or trustees appointed by any court whatsoever, of the person or corporation.
“Public or any portion thereof” means the public generally, or any limited portion of the public, including a person, private corporation, municipality, or other political subdivision of the State, for which the service is performed or to which the commodity is delivered.
“Transportation of persons” includes every service in connection with or incidental to the safety, comfort, or convenience of the person transported and the receipt, carriage, and delivery of such person and his baggage.
“Transportation of property” includes every service in connection with or incidental to the transportation of property, including in particular its receipt, delivery, elevation, transfer, switching, carriage, ventilation, refrigeration, icing, dunnage, storage, and handling, and the transmission of credit by express corporations.
“Rates” includes rates, fares, tolls, rentals, and charges, unless the context indicates otherwise.
“Common carrier” means every person and corporation providing transportation for compensation to or for the public or any portion thereof, except as otherwise provided in this part.
“Common carrier” includes:
Every railroad corporation; street railroad corporation; dispatch, sleeping car, dining car, drawing-room car, freight, freightline, refrigerator, oil, stock, fruit, car-loaning, car-renting, car-loading, and every other car corporation or person operating for compensation within this state.
Every corporation or person, owning, controlling, operating, or managing any vessel used in the transportation of persons or property for compensation between points upon the inland waters of this state or upon the high seas between points within this state, except as provided in Section 212. “Inland waters” as used in this section includes all navigable waters within this state other than the high seas.
Every “passenger stage corporation” operating within this state.
“Common carrier” shall not include:
Any corporation or person owning, controlling, operating, or managing any vessel, by reason of the furnishing of water transportation service between points upon the inland waters of this state or upon the high seas between points within this state for affiliated or parent or subsidiary companies or for the products of other corporations or persons engaged in the same industry, if the water transportation service is furnished in tank vessels or barges specially constructed to hold liquids or fluids in bulk and if the service is not furnished to others not engaged in the same industry.
Any corporation or person who operates any vessel for the transportation of persons for compensation, between points in this state if one terminus of every trip operated by the corporation or person is within the boundaries of a United States military reservation and is performed under a contract with an agency of the federal government which specifies the terms of service to be provided; and provided that the corporation or person does not perform any service between termini within this state which are outside of a United States military reservation. For the purposes of this subdivision, the conditions of this exemption shall be reviewed by the Public Utilities Commission annually as of the first day of January of each year.
Any corporation or person owning, controlling, operating, or managing any recreational conveyance such as a ski lift, ski tow, J-bar, T-bar, chair lift, aerial tramway, or other device or equipment used primarily while participating in winter sports activities.
Any corporation or person furnishing or otherwise providing transportation by horse, mule, or other equine animal for entertainment or recreational purposes.
Any motor carrier of property, as defined in Section 34601 of the Vehicle Code.
A household mover, as defined in Section 19225.5 of the Business and Professions Code.
This section shall become operative on July 1, 2018.
With respect to a motor vehicle used in the transportation of passengers for compensation by a passenger stage corporation, “owner” means the corporation or person who is registered with the Department of Motor Vehicles as the owner of the vehicle, or who has a legal right to possession of the vehicle pursuant to a lease or rental agreement.
“Between fixed termini or over a regular route” means the termini or route between which, or over which any passenger stage corporation usually or ordinarily operates any passenger stage, even though there may be departures from the termini or route, whether these departures are periodic or irregular.
“Food products for human consumption” means articles used for human food or drink and articles used as components of any of those articles.
“Nonfood product” means any article, material, substance, or product which is not food.
“Public utility” includes every common carrier, toll bridge corporation, pipeline corporation, gas corporation, electrical corporation, telephone corporation, telegraph corporation, water corporation, sewer system corporation, and heat corporation, where the service is performed for, or the commodity is delivered to, the public or any portion thereof.
A provider of last resort, as defined in Section 387, that is providing service pursuant to Article 8.5 (commencing with Section 387) of Chapter 2.3 is a public utility subject to the jurisdiction, control, and regulation of the commission and the provisions of this part regarding providing that service.
Whenever any common carrier, toll bridge corporation, pipeline corporation, gas corporation, electrical corporation, telephone corporation, telegraph corporation, water corporation, sewer system corporation, or heat corporation performs a service for, or delivers a commodity to, the public or any portion thereof for which any compensation or payment whatsoever is received, that common carrier, toll bridge corporation, pipeline corporation, gas corporation, electrical corporation, telephone corporation, telegraph corporation, water corporation, sewer system corporation, or heat corporation, is a public utility subject to the jurisdiction, control, and regulation of the commission and the provisions of this part.
When any person or corporation performs any service for, or delivers any commodity to, any person, private corporation, municipality, or other political subdivision of the state, that in turn either directly or indirectly, mediately or immediately, performs that service for, or delivers that commodity to, the public or any portion thereof, that person or corporation is a public utility subject to the jurisdiction, control, and regulation of the commission and the provisions of this part.
Ownership or operation of a facility that employs cogeneration technology or produces power from other than a conventional power source or the ownership or operation of a facility which employs landfill gas technology does not make a corporation or person a public utility within the meaning of this section solely because of the ownership or operation of that facility.
Any corporation or person engaged directly or indirectly in developing, producing, transmitting, distributing, delivering, or selling any form of heat derived from geothermal or solar resources or from cogeneration technology to any privately owned or publicly owned public utility, or to the public or any portion thereof, is not a public utility within the meaning of this section solely by reason of engaging in any of those activities.
The ownership or operation of a facility that sells compressed natural gas or hydrogen at retail to the public for use only as a motor vehicle fuel, and the selling of compressed natural gas or hydrogen at retail from that facility to the public for use only as a motor vehicle fuel, does not make the corporation or person a public utility within the meaning of this section solely because of that ownership, operation, or sale.
Ownership or operation of a facility that is an exempt wholesale generator, as defined in the Public Utility Holding Company Act of 2005 (42 U.S.C. Sec. 16451(6)), does not make a corporation or person a public utility within the meaning of this section, solely due to the ownership or operation of that facility.
The ownership, control, operation, or management of an electric plant used for direct transactions or participation directly or indirectly in direct transactions, as permitted by subdivision (b) of Section 365, sales into a market established and operated by the Independent System Operator or any other wholesale electricity market, or the use or sale as permitted under subdivisions (b) to (d), inclusive, of Section 218, shall not make a corporation or person a public utility within the meaning of this section solely because of that ownership, participation, or sale.
The ownership, control, operation, or management of a facility that supplies electricity to the public only for use to charge light duty plug-in electric vehicles does not make the corporation or person a public utility within the meaning of this section solely because of that ownership, control, operation, or management. For purposes of this subdivision, “light duty plug-in electric vehicles” includes light duty battery electric and plug-in hybrid electric vehicles. This subdivision does not affect the commission’s authority under Section 454 or 740.2 or any other applicable statute.
Notwithstanding Section 216, “public utility” does not include a motor carrier of property.
“Cable television corporation” shall mean any corporation or firm which transmits television programs by cable to subscribers for a fee.
“Cogeneration” means the sequential use of energy for the production of electrical and useful thermal energy. The sequence can be thermal use followed by power production or the reverse, subject to the following standards:
At least 5 percent of the facility’s total annual energy output shall be in the form of useful thermal energy.
Where useful thermal energy follows power production, the useful annual power output plus one-half the useful annual thermal energy output equals not less than 42.5 percent of any natural gas and oil energy input.
“Commercial mobile radio service” means “commercial mobile service,” as defined in subsection (d) of Section 332 of Title 47 of the United States Code and as further specified by the Federal Communications Commission in Parts 20, 22, 24, and 25 of Title 47 of the Code of Federal Regulations, and includes “mobile data service,” “mobile paging service,” “mobile satellite telephone service,” and “mobile telephony service,” as those terms are defined in Section 224.4.
“Electric plant” includes all real estate, fixtures and personal property owned, controlled, operated, or managed in connection with or to facilitate the production, generation, transmission, delivery, or furnishing of electricity for light, heat, or power, and all conduits, ducts, or other devices, materials, apparatus, or property for containing, holding, or carrying conductors used or to be used for the transmission of electricity for light, heat, or power.
“Electrical corporation” includes every corporation or person owning, controlling, operating, or managing any electric plant for compensation within this state, except where electricity is generated on or distributed by the producer through private property solely for its own use or the use of its tenants and not for sale or transmission to others.
“Electrical corporation” does not include a corporation or person employing cogeneration technology or producing power from other than a conventional power source for the generation of electricity solely for any one or more of the following purposes:
Its own use or the use of its tenants.
The use of or sale to not more than two other corporations or persons solely for use on the real property on which the electricity is generated or on real property immediately adjacent thereto, unless there is an intervening public street constituting the boundary between the real property on which the electricity is generated and the immediately adjacent property and one or more of the following applies:
The real property on which the electricity is generated and the immediately adjacent real property is not under common ownership or control, or that common ownership or control was gained solely for purposes of sale of the electricity so generated and not for other business purposes.
The useful thermal output of the facility generating the electricity is not used on the immediately adjacent property for petroleum production or refining.
The electricity furnished to the immediately adjacent property is not utilized by a subsidiary or affiliate of the corporation or person generating the electricity.
Sale or transmission to an electrical corporation or state or local public agency, but not for sale or transmission to others, unless the corporation or person is otherwise an electrical corporation.
“Electrical corporation” does not include a corporation or person employing landfill gas technology for the generation of electricity for any one or more of the following purposes:
“Electrical corporation” does not include a corporation or person employing digester gas technology for the generation of electricity for any one or more of the following purposes:
“Electrical corporation” does not include an independent solar energy producer, as defined in Article 3 (commencing with Section 2868) of Chapter 9 of Part 2.
The amendments made to this section at the 1987 portion of the 1987–88 Regular Session of the Legislature do not apply to any corporation or person employing cogeneration technology or producing power from other than a conventional power source for the generation of electricity that physically produced electricity prior to January 1, 1989, and furnished that electricity to immediately adjacent real property for use thereon prior to January 1, 1989.
“Electric service provider” means an entity that offers electrical service to customers within the service territory of an electrical corporation and includes the unregulated affiliates and subsidiaries of an electrical corporation.
“Electric service provider” does not include an entity that offers electrical service solely to service customer load consistent with subdivision (b) of Section 218, and does not include an electrical corporation or a public agency that offers electrical service to residential and small commercial customers within its jurisdiction, or within the service territory of a local publicly owned electric utility.
“Electric service provider” does not include an independent solar energy producer, as defined in Article 3 (commencing with Section 2868) of Chapter 9 of Part 2.
The following terms have the following meanings:
“Exempt wholesale generator” has the same meaning as defined in the Public Utility Holding Company Act of 2005 (42 U.S.C. Sec. 16451(6)).
“Qualifying small power producer,” “small power production facility,” and “qualifying small power production facility” have the same meanings as found in Section 796 of Title 16 of the United States Code and the regulations enacted pursuant thereto.
Notwithstanding any other provision of law, a qualifying small power producer owning or operating a small power production facility is not a public utility subject to the general jurisdiction of the commission solely because of the ownership or operation of the facility.
Notwithstanding any other provision of law, an exempt wholesale generator is not a public utility subject to the general jurisdiction of the commission solely due to the ownership or operation of the facility.
“Express corporation” includes every corporation or person engaged in or transacting the business of transporting any freight, merchandise, or other property for compensation on the line of any common carrier or stage or auto stage line within this State.
“Freight forwarder” means any corporation or person who for compensation undertakes the collection and shipment of property of others, and as consignor or otherwise ships or arranges to ship the property via the line of any common carrier at the tariff rates of such carrier, or who receives such property as consignee thereof.
This section shall not apply to any agricultural or horticultural cooperative organization operating under and by virtue of the laws of this or any other state or the District of Columbia or under federal statute in the performance of its duties for its members, or the agents, individual or corporate, of such organization in the performance of their duties as agents.
This section shall not apply to the operation of a shipper, or a group or association of shippers, in consolidating or distributing freight for themselves or for the members thereof, on a nonprofit basis, for the purpose of securing the benefits of carload, truckload, or other volume rates, or to the operations of a shippers’ agent, in consolidating or distributing pool cars, whose services and responsibilities to shippers in connection with such operations are confined to the terminal area in which such operations are performed.
“Gas plant” includes all real estate, fixtures, and personal property, owned, controlled, operated, or managed in connection with or to facilitate the production, generation, transmission, delivery, underground storage, or furnishing of gas, natural or manufactured, except propane, for light, heat, or power.
“Gas corporation” includes every corporation or person owning, controlling, operating, or managing any gas plant for compensation within this state, except where gas is made or produced on and distributed by the maker or producer through private property alone solely for his own use or the use of his tenants and not for sale to others.
“Gas corporation” shall not include a corporation or person employing landfill gas technology for the production of gas for its own use or the use of its tenants or for sale to a gas corporation or state or local public agency, except that if the gas produced is of such insufficient quality or heating value that it is unacceptable for introduction into the line, plant, or system of a gas corporation or state or local public agency, the person or corporation employing landfill gas technology may without becoming a gas corporation for purposes of this part sell the gas so produced to not more than four other corporations or persons.
“Golden State Energy” means the nonprofit public benefit corporation that is incorporated and operating pursuant to Division 1.7 (commencing with Section 3400).
“Heating plant” includes all real estate, fixtures, and personal property owned, controlled, operated, or managed in connection with or to facilitate the production, generation, transmission, delivery or furnishing of heat for domestic, business, industrial, or public use.
“Heat corporation” includes every corporation or person owning, controlling, operating, or managing any heating plant for compensation within this state, except where heat is generated on or distributed by the producer through private property alone solely for his own use or the use of his tenants and not for sale to others.
“Heat corporation” shall not include a corporation or person employing landfill gas technology for the production or generation of heat for its own use or the use of its tenants or for sale to a heat corporation or state or local public agency.
“Landfill gas technology” means the process of extraction of gas or gaseous compounds from sanitary landfill areas which gas or compound was generated as a byproduct of the materials composing the landfill. For purposes of this division, real estate, fixtures, and personal property including gas extraction wells, engines and compressors for gas removal or storage, gas cleaning or rectifying equipment, equipment for the generation or production of steam, electricity, heat, or other form of energy through the use of landfill gas, and facilities for the transmission or distribution of landfill gas or other form of energy generated or produced therefrom shall not be considered an electrical, gas, or heat plant or pipeline.
“Local publicly owned electric utility” means a municipality or municipal corporation operating as a “public utility” furnishing electric service as provided in Section 10001, a municipal utility district furnishing electric service formed pursuant to Division 6 (commencing with Section 11501), a public utility district furnishing electric services formed pursuant to the Public Utility District Act set forth in Division 7 (commencing with Section 15501), an irrigation district furnishing electric services formed pursuant to the Irrigation District Law set forth in Division 11 (commencing with Section 20500) of the Water Code, or a joint powers authority that includes one or more of these agencies and that owns generation or transmission facilities, or furnishes electric services over its own or its member’s electric distribution system.
“Mobile data service” means the delivery of nonvoice information to a mobile device and includes nonvoice information communicated to a mobile telephony services handset, nonvoice information communicated to handheld personal digital assistant (PDA) devices and laptop computers, and mobile paging service carriers offering services on pagers and two-way messaging devices. Unless specified, “mobile data service” does not include nonvoice information communicated through a wireless local area network operating in the unlicensed radio bands, commonly known as a “Wi-Fi” network.
“Mobile paging service” means the transmission of coded radio signals for the purpose of activating specific small radio receivers designed to be carried by a person and to give an aural, visual, or tactile indication when activated.
“Mobile satellite telephone service” means voice communication to end users over a mobile satellite service involving the provision of commercial mobile radio service, pursuant to Parts 20 and 25 of Title 47 of the Code of Federal Regulations.
“Mobile telephony service” means commercially available interconnected mobile phone services that provide access to the public switched telephone network (PSTN) via mobile communication devices employing radiowave technology to transmit calls, including cellular radiotelephone, broadband Personal Communications Services (PCS), and digital Specialized Mobile Radio (SMR). “Mobile telephony services” does not include mobile satellite telephone services or mobile data services used exclusively for the delivery of nonvoice information to a mobile device.
“Motor carrier of property” means a motor carrier of property as defined in Section 34601 of the Vehicle Code.
“Network railroad transportation” means railroad transportation that is subject to the jurisdiction of the federal Surface Transportation Board pursuant to subsection (a) or (b) of Section 10501 of Title 49 of the United States Code.
“Passenger stage” includes every stage, auto stage, or other motor vehicle used in the transportation of persons, or persons and their baggage or express, or persons or baggage or express, when such baggage or express is transported incidental to the transportation of passengers.
“Passenger stage corporation” includes every corporation or person engaged as a common carrier, for compensation, in the ownership, control, operation, or management of any passenger stage over any public highway in this state between fixed termini or over a regular route except those, 98 percent or more of whose operations as measured by total route mileage operated, which are exclusively within the limits of a single city or city and county, or whose operations consist solely in the transportation of bona fide pupils attending an institution of learning between their homes and that institution.
For purposes of this section, the percentage of the route mileage within the limits of any city shall be determined by the Public Utilities Commission on the first day of January of each year, and the percentage so determined shall be presumed to continue for the year.
“Passenger stage corporation” does not include that part of the operations of any corporation or person engaged in the ownership, control, operation, or management of any passenger stage over any public highway in this state, whether between fixed termini or over a regular route or otherwise, engaged in the transportation of any pupils or students to and from a public or private school, college, or university, or to and from activities of a public or private school, college, or university, where the rate, charge, or fare for that transportation is not computed, collected, or demanded on an individual fare basis.
“Passenger stage corporation” does not include the transportation of persons between home and work locations or of persons having a common work-related trip purpose in a vehicle having a seating capacity of 15 passengers or less, including the driver, which is used for the purpose of ridesharing, as defined in Section 522 of the Vehicle Code, when the ridesharing is incidental to another purpose of the driver. This exemption also applies to a vehicle having a seating capacity of more than 15 passengers if the driver files with the commission evidence of liability insurance protection in the same amount and in the same manner as required for a passenger stage corporation, and the vehicle undergoes and passes an annual safety inspection by the Department of the California Highway Patrol. The insurance filing shall be accompanied by a one-time filing fee of seventy-five dollars ($75). This exemption does not apply if the primary purpose for the transportation of those persons is to make a profit. “Profit,” as used in this subdivision, does not include the recovery of the actual costs incurred in owning and operating a vanpool vehicle, as defined in Section 668 of the Vehicle Code.
“Passenger stage corporation” does not include that part of the operations of any corporation or person engaged in the ownership, control, operation, or management of any medical transportation vehicles, including vehicles employed to transport developmentally disabled persons for regional centers established pursuant to Chapter 5 (commencing with Section 4620) of Division 4.5 of the Welfare and Institutions Code.
“Passenger stage corporation” does not include the transportation of persons which is ancillary to commercial river rafting and is for the sole purpose of returning passengers to the point of origin of their rafting trip.
“Passenger stage corporation” does not include social service transportation delivered by a nonprofit social service transportation provider or a locally licensed or franchised for-profit transportation provider which operates, in dedicated vehicles, social service transportation pursuant to contract with a nonprofit social service transportation provider organization as long as the provider does not use a vehicle designed for carrying more than 16 persons, including the driver, or does not operate vehicles which offer transportation services over regularly scheduled or fixed routes.
“Passenger stage corporation” does not include intrastate passenger transportation service conducted pursuant to federal operating authority to the extent that regulation of these intrastate operations by the commission is preempted by the federal Bus Regulatory Reform Act of 1982 (P.L. 97-261), as amended.
“Pipe line” includes all real estate, fixtures, and personal property, owned, controlled, operated, or managed in connection with or to facilitate the transmission, storage, distribution, or delivery of crude oil or other fluid substances except water through pipe lines.
“Pipeline corporation” includes every corporation or person owning, controlling, operating, or managing any pipeline for compensation within this state.
“Pipeline corporation” shall not include a corporation or person employing landfill gas technology and owning, controlling, operating, or managing any pipeline solely for the transmission or distribution of landfill gas or other form of energy generated or produced therefrom.
“Railroad” includes every commercial, interurban, and other railway, other than a street railroad, and each branch or extension thereof, by whatsoever power operated, together with all tracks, bridges, trestles, rights of way, subways, tunnels, stations, depots, union depots, ferries, yards, grounds, terminals, terminal facilities, structures, and equipment, and all other real estate, fixtures, and personal property of every kind used in connection therewith, owned, controlled, operated, or managed for public use in the transportation of persons or property.
“Railroad corporation” includes every corporation or person owning, controlling, operating, or managing any railroad for compensation within this State.
“Service area,” for purposes of the operations of a telephone corporation, means a local access and transport area as defined and approved by the United States District Court for the District of Columbia circuit in the case of the United States v. Western Electric Co., Inc., and American Telephone and Telegraph Co., CA 82-0192, April 20 and July 8, 1983, and in a Memorandum and Order of August 5, 1983.
“Sewer system” includes all real estate, fixtures, and personal property owned, controlled, operated, or managed in connection with or to facilitate sewage collection, treatment, or disposition for sanitary or drainage purposes, including any and all lateral and connecting sewers, interceptors, trunk and outfall lines and sanitary sewage treatment or disposal plants or works, and any and all drains, conduits, and outlets for surface or storm waters, and any and all other works, property or structures necessary or convenient for the collection or disposal of sewage, industrial waste, or surface or storm waters. “Sewer system” shall not include a sewer system which merely collects sewage on the property of a single owner.
“Sewer system corporation” includes every corporation or person owning, controlling, operating, or managing any sewer system for compensation within this state.
“Street railroad” includes every railway, and each branch or extension thereof, by whatsoever power operated, being mainly upon, along, above or below any street, avenue, road, highway, bridge, or public place within any city or city and county, together with all real estate, fixtures, and personal property of every kind used in connection therewith, owned, controlled, operated, or managed for public use in the transportation of persons or property, but does not include a railway constituting or used as a part of a commercial or interurban railway.
“Street railroad corporation” includes every corporation or person owning, controlling, operating, or managing any street railroad for compensation within this State, or owning, controlling, operating, or managing as a part of or in conjunction with such street railroad any automobile, jitney bus, stage, or auto stage used in the business of transportation of persons or property for compensation over any public highway in this State between fixed termini or over a regular route.
“Telephone line” includes all conduits, ducts, poles, wires, cables, instruments, and appliances, and all other real estate, fixtures, and personal property owned, controlled, operated, or managed in connection with or to facilitate communication by telephone, whether such communication is had with or without the use of transmission wires.
“Telephone corporation” includes every corporation or person owning, controlling, operating, or managing any telephone line for compensation within this state.
“Telephone corporation” does not include any of the following:
Any hospital, hotel, motel, or similar place of temporary accommodation owning or operating message switching or billing equipment solely for the purpose of reselling services provided by a telephone corporation to its patients or guests.
Any one-way paging service utilizing facilities that are licensed by the Federal Communications Commission, including, but not limited to, narrowband personal communications services described in Subpart D (commencing with Section 24.100) of Part 24 of Title 47 of the Code of Federal Regulations, as in effect on June 13, 1995.
“Telegraph line” includes all conduits, ducts, poles, wires, cables, instruments, and appliances, and all other real estate, fixtures, and personal property owned, controlled, operated, or managed in connection with or to facilitate communication by telegraph, whether such communication is had with or without the use of transmission wires.
“Telegraph corporation” includes every corporation or person owning, controlling, operating, or managing any telegraph line for compensation within this State.
“Toll-bridge corporation” includes every private corporation or person owning, controlling, operating, or managing any bridge or appurtenance thereto, used for the transportation of persons or property for compensation in this State.
“Transportation electrification” means the use of electricity from external sources of electrical power, including the electrical grid, for all or part of vehicles, vessels, trains, boats, or other equipment that are mobile sources of air pollution and greenhouse gases and the related programs and charging and propulsion infrastructure investments to enable and encourage this use of electricity.
“Vessel” includes every species of watercraft, by whatsoever power operated, which is owned, controlled, operated or managed for public use in the transportation of persons or property, except rowboats, sailing boats, barges under 20 tons dead weight carrying capacity, and vessels which are both under the burden of five tons net register and under 30 feet in length. However, a vessel which is under the burden of five tons net register but is 30 or more feet in length is not a “vessel” for the purpose of this section if it is used to provide ship-to-shore services by which stores, supplies, spares, passengers, or crew of oceangoing ships are transported to or from ship and shore and payment for such services is made by, or arranged through, the oceangoing shipping company (commonly referred to as water taxi services).
Nothing in this code except those provisions relating to the regulation of rates shall apply to the transportation by a water carrier of commodities in bulk when the cargo space of the vessel in which such commodities are transported is being used for the carrying of not more than three such commodities. This subsection shall apply only in the case of commodities, in bulk which are loaded and carried without wrappers or containers and received and delivered by the carrier without transportation mark or count. For the purposes of this subsection two or more vessels while navigated as a unit shall be considered to be a single vessel.
Nothing in this code shall apply to the transportation by water of liquid cargoes in bulk in tank vessels designed for use exclusively in such service.
Any person or corporation lawfully engaged in business in the transportation of persons or property during the entire one-year period preceding March 1, 1993, and continuously thereafter, and which, solely by virtue of the amendment to subdivision (a) made by the act that adds this subdivision, will become subject to commission regulation as a common carrier by vessel, shall file with the commission, prior to March 1, 1994, an application for a certificate of public convenience and necessity to operate as a common carrier by vessel. However, in lieu of all other fees required by law, the applicant shall pay a fee of fifty dollars ($50). The commission shall issue the certificate without further proceedings authorizing operation over the specific routes or within the specific area which conforms to proof of actual service in the transportation of persons or property as produced by the applicant with respect to its operations during the entire one-year period preceding March 1, 1993, and continuously thereafter.
“Voice over Internet Protocol” or “VoIP” means voice communications service that does all of the following:
Uses Internet Protocol or a successor protocol to enable real-time, two-way voice communication that originates from, or terminates at, the user’s location in Internet Protocol or a successor protocol.
Requires a broadband connection from the user’s location.
Permits a user generally to receive a call that originates on the public switched telephone network and to terminate a call to the public switched telephone network.
A service that uses ordinary customer premises equipment with no enhanced functionality that originates and terminates on the public switched telephone network, undergoes no net protocol conversion, and provides no enhanced functionality to end users due to the provider’s use of Internet Protocol technology is not a VoIP service.
“Internet Protocol enabled service” or “IP enabled service” means any service, capability, functionality, or application using existing Internet Protocol, or any successor Internet Protocol, that enables an end user to send or receive a communication in existing Internet Protocol format, or any successor Internet Protocol format through a broadband connection, regardless of whether the communication is voice, data, or video.
“Water system” includes all reservoirs, tunnels, shafts, dams, dikes, headgates, pipes, flumes, canals, structures, and appliances, and all other real estate, fixtures, and personal property, owned, controlled, operated, or managed in connection with or to facilitate the diversion, development, storage, supply, distribution, sale, furnishing, carriage, apportionment, or measurement of water for power, irrigation, reclamation, or manufacturing, or for municipal, domestic, or other beneficial use.
“Water corporation” includes every corporation or person owning, controlling, operating, or managing any water system for compensation within this State.
The commission and Energy Commission shall collaborate to develop and maintain a list of community-based organizations to help ensure adequate public outreach in low-income, disadvantaged, rural, tribal, and unincorporated communities regarding available programs and incentives.
In developing the list pursuant to subdivision (a), the commission and Energy Commission shall work with existing advisory committees and low-income oversight boards, and with current community-based organizations engaged at their respective agencies.
This part shall not release or waive any right of action by the State, the commission, or any person or corporation for any right, penalty, or forfeiture which may have arisen or accrued or may hereafter arise or accrue under any law of this State.
No transit district, common carrier, or publicly owned transit system shall require any person to waive, limit, or qualify any right to recover damages for injury in exchange for such person being granted a reduction in price or fare for any service offered by the transit district, common carrier, or publicly owned transit system.
“Person,” as used in this section, shall not include an employee of the transit district, common carrier, or publicly owned transit system.
A person or corporation shall not be a public utility subject to the jurisdiction, control and regulation of the commission and the provisions of this part solely because such person or corporation owns or controls any electric plant (a) which is leased or held for lease or sale to any public utility, or (b) the operation and use of which is vested by lease or other contract in a public utility, or (c) for a period of not more than 90 days after termination of any lease or contract with a public utility or after repossession of such property following a breach of such lease or contract. The commission may upon application issue its order approving the terms of any such lease or contract for the purpose of qualifying such person or corporation for an exemption by the Securities and Exchange Commission of the United States from the federal Public Utility Holding Company Act of 1935, as amended (Chapter 2C (commencing with Section 79) of Title 15, United States Code). This section shall apply only to persons or corporations for which such lease or contract was approved by the commission prior to January 1, 1979. Nothing in this section shall alter or modify the authority of the commission to regulate the rates and service of a person or corporation which is a public utility subject to the provisions of this part.
Any provision of this part that is in conflict with the Communications Act of 1934, as amended, (47 U.S.C. Sec. 332(c)(3)) shall not apply to commercial mobile radio service to the extent of that conflict. If any provision contained in this part applicable to commercial mobile radio service, or the application thereof to any person or circumstance, is invalid as a result of federal preemption, the remainder of this part, or the application of the provision to other persons or circumstances, shall not be affected thereby.
The Mobile Telecommunications Sourcing Act (Public Law 106-252) was enacted for the purpose of establishing nationwide uniform sourcing rules for the imposition of state and local taxes, fees, and surcharges on mobile telecommunications services. In order to establish a single, uniform sourcing rule, the federal act partially preempted state and local law imposing taxes, fees, and surcharges on a mobile telecommunications services customer whose place of primary use is outside of the state in which the state and local taxes, fees, or surcharges are imposed.
In accordance with the Mobile Telecommunications Sourcing Act, which is incorporated herein by reference, and notwithstanding Sections 275.6, 276.5, 280, 431, 879, and 2881, the surcharges or fees under these sections do not apply to any charges for mobile telecommunications services billed to a customer where those services are provided, or deemed provided, to a customer whose place of primary use is outside this state. Mobile telecommunications services shall be deemed provided by a customer’s home service provider to the customer if those services are provided in a taxing jurisdiction to the customer, and the charges for those services are billed by or for the customer’s home service provider.
For purposes of this section:
“Charges for mobile telecommunications services” means any charge for, or associated with, the provision of commercial mobile radio service, as defined in Section 216.8, or any charge for, or associated with, a service provided as an adjunct to a commercial mobile radio service, that is billed to the customer by or for the customer’s home service provider, regardless of whether individual transmissions originate or terminate within the licensed service area of a home service provider.
“Customer” means either (A) the person or entity that contracts with the home service provider for mobile telecommunications services, or (B) if the end user of mobile telecommunications services is not the contracting party, the end user of the mobile telecommunications service. This paragraph applies only for the purpose of determining the place of primary use. The term “customer” does not include either (A) a reseller of mobile telecommunications service, or (B) a serving carrier under an arrangement to serve the customer outside the home service provider’s licensed service area.
“Home service provider” means the facilities-based carrier or reseller with which the customer contracts for the provision of mobile telecommunications services.
“Licensed service area” means the geographic area in which the home service provider is authorized by law or contract to provide commercial mobile radio service to the customer.
“Mobile telecommunications service” means commercial mobile radio service, as defined in Section 216.8.
“Place of primary use” means the street address representative of where the customer’s use of the mobile telecommunications service primarily occurs, that must be:
The residential street address or the primary business street address of the customer.
Within the licensed area of the home service provider.
“Reseller” means a provider who purchases telecommunications services from another telecommunications service provider and then resells the services, or uses the services as a component part of, or integrates the purchased services into a mobile telecommunications service.
“Reseller” does not include a serving carrier with which a home service provider arranges for the services to its customers outside the home service provider’s licensed service area.
“Serving carrier” means a facilities-based carrier providing mobile telecommunications service to a customer outside a home service provider’s or reseller’s licensed area.
“Taxing jurisdiction” means any of the several states, the District of Columbia, or any territory or possession of the United States, any municipality, city, county, township, parish, transportation district, or assessment jurisdiction, or any other political subdivision within the territorial limits of the United States with the authority to impose a tax, charge, or fee.
Any provision of the Public Utilities Act that is in conflict with the railroad provisions of Part A of Subtitle 4 of Title 49 of the United States Code shall be inapplicable to railroad transportation to the extent of that conflict. If any provision in the Public Utilities Act applicable to railroad transportation, or the application thereof to any person or circumstance, is in conflict with Part A of Subtitle 4 of Title 49 of the United States Code, the remainder of the act or the application of the provision to other persons or circumstances shall be unaffected to the extent no conflict exists.
CHAPTER 1.5. Advisory Boards [270. - 285.]
The following funds are hereby created in the State Treasury:
The California High-Cost Fund-A Administrative Committee Fund.
The California High-Cost Fund-B Administrative Committee Fund.
The Universal Lifeline Telephone Service Trust Administrative Committee Fund.
The Deaf and Disabled Telecommunications Program Administrative Committee Fund.
The California Teleconnect Fund Administrative Committee Fund.
The California Advanced Services Fund.
Moneys in the funds are held in trust and may only be expended pursuant to this chapter and upon appropriation in the annual Budget Act or upon supplemental appropriation.
The commission, in administering the universal service program funds listed in subdivision (a), and in administering state participation in federal universal service programs, is encouraged, consistent with the state’s universal service policies and goals, to maximize the amount of federal funding to California participants in the federal programs.
Notwithstanding any other provision of law, the commission may authorize the trustee of the California High-Cost Fund-B Trust to transfer to the Deaf Equipment Acquisition Fund Trust (DEAF Trust) money sufficient to cover the costs of the programs as specified in subdivision (a) of Section 278, including, but not limited to, all costs specified in subdivision (c) of Section 278. The amount of any transfer of money authorized may not exceed the cost of operating the programs for six months. The commission shall also establish other terms of the transfer, as it determines to be appropriate.
The commission shall reimburse the California High-Cost Fund-B Trust for any transfer of money to the DEAF Trust authorized pursuant to subdivision (a), with interest as determined by the commission.
A sum equivalent to the amount of money transferred to the Deaf Equipment Acquisition Fund Trust (DEAF Trust) pursuant to subdivision (a) is hereby appropriated from the Deaf and Disabled Telecommunications Program Administrative Committee Fund to the commission, for allocation to the California High-Cost Fund-B Trust, for purposes of subdivision (b).
Funds may not be transferred from the California High-Cost Fund-B Trust to the DEAF Trust pursuant to subdivision (a) after September 30, 2001.
Commencing on October 1, 2001, and until a date not later than June 30, 2002, reimbursements made to the California High-Cost Fund-B Trust pursuant to subdivisions (b) and (c) shall be deposited in a separate memorandum account within the DEAF Trust, subject to the terms specified in subdivision (b).
On July 1, 2002, any funds in the DEAF Trust deposited in the memorandum account for purposes of reimbursing the California High-Cost Fund-B Trust shall revert to the Controller for deposit in the California High-Cost Fund-B Trust Committee Fund in the State Treasury rather than the Deaf and Disabled Telecommunications Program Administrative Committee Fund.
Commencing on July 1, 2003, any funds remaining in the DEAF Trust, exclusive of those identified in subdivision (f), shall revert to the Deaf and Disabled Telecommunications Program Administrative Committee Fund in the State Treasury.
For each advisory board created pursuant to this chapter all of the following are applicable:
The commission shall establish the number of, and qualifications for, persons to serve as members of each board, and shall appoint the members of each board. In determining the qualifications of persons who will serve as members of each board, the commission shall consider the purpose of the program, and shall attempt to achieve balanced public participation, for each board. The membership of each board shall reflect, to the extent possible, and consistent with existing law, the ethnic and gender diversity of the state.
Each board shall determine, subject to approval by the commission, the time, location, and number of monthly meetings for each board.
A majority of the number of members of each board constitutes a quorum.
A board cannot act at a meeting without the presence of a quorum.
The affirmative vote of a majority of those members present at the meeting of a board is necessary in order to pass any motion, resolution, or measure.
The commission shall determine for each board whether the board members shall receive expense reimbursement pursuant to Section 19820 of the Government Code and a per diem allowance, as specified in Section 11564.5 of the Government Code, or as established by the commission. Each member of a board who is not a commission or public utility employee, or who is not otherwise compensated by an employer for service on the board, shall be entitled to make a claim for and to receive a per diem allowance, if authorized by the commission. Each member of a board who is not a public utility employee, or who is not otherwise reimbursed by an employer for expenses incurred when serving on the board, shall be entitled to make a claim for and to receive expense reimbursement, if authorized by the commission. The commission shall allow all reasonable expense and per diem claims. The payments in each instance shall be made only from the fund that supports the activities of the board and shall be subject to the availability of money in that fund. The claims shall be filed by the board with the commission.
Each advisory board created pursuant to this chapter shall do both of the following:
Submit an annual budget to the commission. Within 90 calendar days after receiving a board’s annual budget, the commission shall either accept, accept with conditions, or reject the submitted budget.
Notwithstanding Section 7550.5 of the Government Code, submit, in accordance with procedures established by the commission, a report that shall describe the activities of the board during the prior reporting period. The report shall be submitted on an annual or more frequent basis, as ordered by the commission.
The commission may on its own order, whenever it determines it to be necessary, conduct audits or reviews of the revenues required to be collected and submitted to the commission for each of the funds specified in Section 270. The commission may on its own order, whenever it determines it to be necessary, conduct audits or reviews on the compliance with commission orders with regard to each program subject to this chapter. The commission shall apply a risk-based methodology to conduct audits or reviews of program-related costs and activities. This section does not limit the commission’s authority to initiate an audit or review when circumstances warrant doing so. The commission may contract with the California State Auditor’s Office, the Department of Finance, or another qualified audit or consulting firm for any necessary auditing or review services if the commission’s own auditing services are not available. All costs for audits or reviews shall be paid from the fund that supports the activities of the board audited or reviewed and shall be subject to the availability of money in that fund.
There is hereby created the California High-Cost Fund-A Administrative Committee, which is an advisory board to advise the commission regarding the development, implementation, and administration of a program to provide for transfer payments to small independent telephone corporations providing local exchange services in high-cost rural and small metropolitan areas in the state to create fair and equitable local rate structures, as provided for in Section 275.6, and to carry out the program pursuant to the commission’s direction, control, and approval.
All revenues collected through surcharges authorized by the commission to fund the program specified in subdivision (a) shall be submitted to the commission pursuant to a schedule established by the commission. The commission shall transfer the moneys received to the Controller for deposit in the California High-Cost Fund-A Administrative Committee Fund. All interest earned by moneys in the fund shall be deposited in the fund.
Moneys appropriated from the California High-Cost Fund-A Administrative Committee Fund to the commission shall be utilized exclusively by the commission for the program specified in subdivision (a), including all costs of the board and the commission associated with the administration and oversight of the program and the fund.
The Legislature finds and declares that, because maintenance of universal public switched telephone network service throughout the state and maintenance of public safety answering points in high-cost areas of the state rely on appropriations from the California High-Cost Fund-A Administrative Committee Fund, maintaining adequate funding levels for the fund is critical to public health and safety.
The commission shall exercise its regulatory authority to maintain the California High-Cost Fund-A Administrative Committee Fund program (CHCF-A program) to provide universal service rate support to small independent telephone corporations in amounts sufficient to meet the revenue requirements established by the commission through rate-of-return regulation in furtherance of the state’s universal service commitment to the continued affordability and widespread availability of safe, reliable, high-quality communications services in rural areas of the state.
For purposes of this section, all of the following terms have the following meanings:
“Carrier of last resort” means a telephone corporation that is required to fulfill all reasonable requests for service within its service territory.
“Rate base” means the value of a telephone corporation’s plant and equipment that is reasonably necessary to provide regulated voice services and access to advanced services, and upon which the telephone corporation is entitled to a fair opportunity to earn a reasonable rate of return.
“Rate design” means the mix of end user rates, high-cost support, and other revenue sources that are targeted to provide a fair opportunity to meet the revenue requirement of the telephone corporation.
“Rate-of-return regulation” means a regulatory structure whereby the commission establishes a telephone corporation’s revenue requirement, and then fashions a rate design to provide the company a fair opportunity to meet the revenue requirement.
“Revenue requirement” means the amount that is necessary for a telephone corporation to recover its reasonable expenses and tax liabilities and earn a reasonable rate of return on its rate base.
“Small independent telephone corporations” are rural incumbent local exchange carriers subject to commission regulation.
In administering the CHCF-A program the commission shall do all of the following:
Ensure that support is not excessive so that the burden on all contributors to the CHCF-A program is limited.
In order to participate in the CHCF-A program, a small independent telephone corporation shall meet all of the following requirements:
Upon request from the commission, a small independent telephone corporation that receives support from the CHCF-A program shall provide information regarding revenues derived from the provision of unregulated internet access service by that corporation or its affiliate within that corporation’s telephone service territory. The commission shall treat as confidential any information provided pursuant to this subdivision.
The commission shall structure the CHCF-A program so that any charge imposed to promote the goals of universal service reasonably equals the value of the benefits of universal service to contributing entities and their subscribers.
This section shall remain in effect only until January 1, 2033, and as of that date is repealed.
There is hereby created the California High-Cost Fund-B Administrative Committee, which is an advisory board to advise the commission regarding the development, implementation, and administration of a program to provide for transfer payments to telephone corporations providing local exchange services in high-cost areas in the state to create fair and equitable local rate structures, as provided for in Section 276.5, and to carry out the program pursuant to the commission’s direction, control, and approval.
All revenues collected through surcharges authorized by the commission to fund the program specified in subdivision (a) shall be submitted to the commission pursuant to a schedule established by the commission. The commission shall transfer the moneys received to the Controller for deposit in the California High-Cost Fund-B Administrative Committee Fund. All interest earned by moneys in the fund shall be deposited in the fund.
Moneys appropriated from the California High-Cost Fund-B Administrative Committee Fund to the commission shall be utilized exclusively by the commission for the program specified in subdivision (a), including all costs of the board and the commission associated with the administration and oversight of the program and the fund.
The commission shall develop, implement, and maintain a suitable, competitively neutral, and broad-based program to establish a fair and equitable local rate support structure aided by universal service rate support to telephone corporations serving areas where the cost of providing services exceeds rates charged by providers, as determined by the commission. The program shall be known, and may be cited, as the California High-Cost Fund-B Administrative Committee Fund program or CHCF-B program. The purpose of the program shall be to promote the goals of universal telephone service and to reduce any disparity in the rates charged by those companies. Except as otherwise explicitly provided, this subdivision does not limit the manner in which the commission collects and disburses funds, and does not limit the manner in which it may include or exclude the revenue of contributing entities in structuring the program.
The commission shall structure the CHCF-B program so that any charge imposed to promote the goals of universal service reasonably equals the value of the benefits of universal service to contributing entities and their subscribers.
The commission shall investigate reducing the level of universal service rate support, or elimination of universal service rate support in service areas with demonstrated competition.
This section shall remain in effect only until January 1, 2033, and as of that date is repealed.
There is hereby created the Universal Lifeline Telephone Service Trust Administrative Committee, which is an advisory board to advise the commission regarding the development, implementation, and administration of a program to ensure lifeline telephone service is available to the people of the state, as provided for in Article 8 (commencing with Section 871) of Chapter 4 of Part 1 of Division 1, and to carry out the program pursuant to the commission’s direction, control, and approval.
All revenues collected by telephone corporations in rates authorized by the commission to fund the program specified in subdivision (a) shall be submitted to the commission pursuant to a schedule established by the commission. Commencing on October 1, 2001, and continuing thereafter, the commission shall transfer the moneys received, and all unexpended revenues collected prior to October 1, 2001, to the Controller for deposit in the Universal Lifeline Telephone Service Trust Administrative Committee Fund. All interest earned by moneys in the fund shall be deposited in the fund.
Moneys appropriated from the Universal Lifeline Telephone Service Trust Administrative Committee Fund to the commission shall be utilized exclusively by the commission for the program specified in subdivision (a), including all costs of the board and the commission associated with the administration and oversight of the program and the fund.
Commencing on July 1, 2003, there is hereby created the Telecommunications Access for Deaf and Disabled Administrative Committee, formerly the Deaf and Disabled Telecommunications Program Administrative Committee, as an advisory board to advise the commission regarding the development, implementation, and administration of programs to provide specified telecommunications services and equipment to persons in this state who are deaf or disabled, as provided for in Sections 2881, 2881.1, and 2881.2.
In addition to the membership qualifications established by the commission pursuant to subdivision (a) of Section 271, the commission shall establish qualifications for persons to serve as members of the Telecommunications Access for Deaf and Disabled Administrative Committee so that consumers of telecommunications services for the deaf and disabled comprise not less than two-thirds of the membership of the committee. To the extent feasible, one of those members shall have experience in the administration of programs similar to those provided for in Sections 2881, 2881.1, and 2881.2.
As part of its advisory role, as specified in paragraph (1), the Telecommunications Access for Deaf and Disabled Administrative Committee shall advise the commission regarding contracts and agreements related to the Deaf and Disabled Telecommunications Program as specified in subdivisions (d) and (e) of Section 2881.4.
All revenues collected by telephone corporations in rates authorized by the commission to fund the programs specified in subdivision (a) shall be submitted to the commission pursuant to a schedule established by the commission. Commencing on July 1, 2003, and continuing thereafter, the commission shall transfer the moneys received, and all unexpended revenue collected prior to July 1, 2003, to the Controller for deposit in the Deaf and Disabled Telecommunications Program Administrative Committee Fund. All interest earned by moneys in the fund shall be deposited in the fund. Those revenues that are collected pursuant to subdivision (g) of Section 2881 shall be accounted for separately, as required by subdivision (b) of Section 2881.2, and deposited in the fund created by the commission pursuant to subdivision (b) of Section 2881.2.
Moneys appropriated from the Deaf and Disabled Telecommunications Program Administrative Committee Fund to the commission shall be utilized exclusively by the commission for the programs specified in subdivision (a), including all costs of the committee and the commission associated with the administration and oversight of the programs and the fund.
Commencing on July 1, 2003, staffing costs incurred by the commission for oversight and administration of the programs described in subdivision (a) shall be funded by moneys appropriated from the Deaf and Disabled Telecommunications Program Administrative Committee Fund.
The commission shall develop, implement, and administer a program to advance universal service by providing discounted rates to qualifying schools maintaining kindergarten or any of grades 1 to 12, inclusive, community colleges, libraries, hospitals, health clinics, and community organizations, consistent with Chapter 278 of the Statutes of 1994.
There is hereby created the California Teleconnect Fund Administrative Committee, which is an advisory board to advise the commission regarding the development, implementation, and administration of a program to advance universal service by providing discounted rates to qualifying schools maintaining kindergarten or any of grades 1 to 12, inclusive, community colleges, libraries, hospitals, health clinics, and community organizations, consistent with Chapter 278 of the Statutes of 1994, and to carry out the program pursuant to the commission’s direction, control, and approval.
All revenues collected by telephone corporations in rates authorized by the commission to fund the program specified in subdivision (a) shall be submitted to the commission pursuant to a schedule established by the commission. The commission shall transfer the moneys received to the Controller for deposit in the California Teleconnect Fund Administrative Committee Fund. All interest earned by moneys in the fund shall be deposited in the fund.
Except as provided in subdivisions (e) and (g), moneys appropriated from the California Teleconnect Fund Administrative Committee Fund to the commission shall be utilized exclusively by the commission for the program specified in subdivision (a), including all costs of the board and the commission associated with the administration and oversight of the program and the fund.
Moneys loaned from the California Teleconnect Fund Administrative Committee Fund in the Budget Act of 2003 are subject to Section 16320 of the Government Code. If the commission determines a need for moneys in the California Teleconnect Fund Administrative Committee Fund, the commission shall notify the Director of Finance of the need, as specified in Section 16320 of the Government Code. The commission may not increase the rates authorized by the commission to fund the program specified in subdivision (b) while moneys loaned from the California Teleconnect Fund Administrative Committee Fund in the Budget Act of 2003 are outstanding unless both of the following conditions are satisfied:
The Director of Finance, after making a determination pursuant to subdivision (b) of Section 16320 of the Government Code, does not order repayment of all or a portion of any loan from the California Teleconnect Fund Administrative Committee Fund within 30 days of notification by the commission of the need for the moneys.
The commission notifies the Director of Finance and the Chairperson of the Joint Legislative Budget Committee in writing that it intends to increase the rates authorized by the commission to fund the program specified in subdivision (a). The notification required pursuant to this paragraph shall be made 30 days in advance of the intended rate increase.
Subdivision (e) shall become inoperative upon full repayment or discharge of all moneys loaned from the California Teleconnect Fund Administrative Committee Fund in the Budget Act of 2003.
Consistent with Decision 11-09-016 (September 8, 2011) Decision Granting Authority to Provide Emergency Access to 211 Services in Counties and Localities Without Existing 211 Centers and to Appoint a 211 Lead Entity, if it determines that doing so is an appropriate use of funds collected from ratepayers, the commission may expend up to one million five hundred thousand dollars ($1,500,000) from the California Teleconnect Fund Administrative Committee Fund for one-time costs to help close 2-1-1 service gaps in counties lacking access to disaster preparedness, response, and recovery information and referral services, where technically feasible, through available 2-1-1 service. As the lead agency appointed by the commission in Decision 11-09-016, 2-1-1 California may apply to the commission for use of the funds in the counties that lack 2-1-1 service. If the commission determines that doing so is an appropriate use of funds collected from ratepayers, these costs may include local implementation of a coordinated database that is owned by a city or county to provide referrals to help with nonemergency aspects of disaster planning, recovery, and response.
This subdivision shall become inoperative on January 1, 2023.
Of the revenues from fees collected pursuant to Section 14666.8 of the Government Code after the operative date of this section, except for revenues from fees from a lease agreement for access to Department of Transportation property or a lease agreement existing prior to the operative date of the section, 15 percent shall be available, upon appropriation by the Legislature, for the purpose of addressing the state’s digital divide.
Revenues described in subdivision (a) shall be deposited in the Digital Divide Account, which is hereby established in the California Teleconnect Fund Administrative Committee Fund established pursuant to Section 270, to be used only for digital divide pilot projects. Not more than 5 percent of the revenues described in subdivision (a) may be used to pay the costs incurred in connection with the administration of digital divide pilot projects by the commission.
The Digital Divide Grant Program is hereby established subject to the availability of funding pursuant to this section. The commission may not implement the grant program until the commission projects that at least five hundred thousand dollars ($500,000) will be available in the Digital Divide Account during the calendar year following implementation, based on money collected pursuant to Section 14666.8 of the Government Code.
The commission shall provide grants pursuant to this subdivision on a competitive basis subject to criteria to be established by the commission and in a way that disburses the funds widely, including urban and rural areas. Grants shall be awarded to community-based nonprofit organizations that are exempt from taxation under Section 501(c)(3) of the Internal Revenue Code for the purpose of funding community technology programs.
Recipients of grants pursuant to this subdivision shall report to the commission annually on the effectiveness of the grant program.
For purposes of this section, “community technology programs” means a program that is engaged in diffusing technology in local communities and training local communities in the use of technology, especially local communities that otherwise would have no access or limited access to the Internet and other technologies.
For purposes of this section, “digital divide projects” means community technology programs involved in activities that include, but are not limited to, the following:
Providing open access to and opportunities for training in technology.
Developing content relevant to the interests and wants of the local community.
Preparing youth for opportunities in the new economy through multimedia training and skills.
Harnessing technology for e-government services.
The commission shall develop, implement, and administer the California Advanced Services Fund to encourage deployment of high-quality advanced communications services to all Californians that will promote economic growth, job creation, and the substantial social benefits of advanced information and communications technologies, consistent with this section and with the statements of intent in Section 2 of the Internet for All Now Act (Chapter 851 of the Statutes of 2017).
The goal of the Broadband Infrastructure Grant Account is, no later than December 31, 2032, to approve funding for infrastructure projects that will provide broadband access to no less than 98 percent of California households in each consortia region, as identified by the commission. The commission shall be responsible for achieving the goals of the program.
For purposes of the Broadband Infrastructure Grant Account, both of the following definitions apply:
“Mbps” means megabits per second.
Except as provided in subclause (II), “unserved area” means an area for which there is no facility-based broadband provider offering at least one tier of broadband service at speeds of at least 25 mbps downstream, 3 mbps upstream, and a latency that is sufficiently low to allow realtime interactive applications, considering updated federal and state broadband mapping data.
(II) For projects funded, in whole or in part, from moneys received from the federal Rural Digital Opportunity Fund, “unserved area” means an area in which no facility-based broadband provider offers broadband service at speeds consistent with the standards established by the Federal Communications Commission pursuant to In the Matter of Rural Digital Opportunity Fund, WC Docket No. 19-126, Report and Order, FCC 20-5 (adopted January 30, 2020, and released February 7, 2020), or as it may be later modified by the Federal Communications Commission.
In approving infrastructure projects funded through the Broadband Infrastructure Grant Account, the commission shall do both of the following:
Approve projects that provide last-mile broadband access to households that are unserved by an existing facility-based broadband provider.
Prioritize projects in unserved areas where internet connectivity is available only at speeds at or below 10 mbps downstream and 1 mbps upstream or areas with no internet connectivity.
This subparagraph does not prohibit the commission from approving funding for projects outside of the areas specified in clause (i).
Moneys appropriated for purposes of this section may be used to match or leverage federal moneys for communications infrastructure, digital equity, and adoption, including, but not limited to, moneys from the United States Department of Commerce Economic Development Administration, the United States Department of Agriculture ReConnect Loan and Grant Program, and the Federal Communications Commission for communications infrastructure, digital equity, and adoption.
The commission shall transition California Advanced Services Fund program methodologies to provide service to serviceable locations and evaluate other program changes to align with other funding sources, including, but not limited to, funding locations.
The commission shall maximize investments in new, robust, and scalable infrastructure and use California Advanced Services Fund moneys to leverage federal and non-California Advanced Services Fund moneys by undertaking activities, including, but not limited to, all of the following:
Providing technical assistance to local governments and providers.
Assisting in developing grant applications.
Assisting in preparing definitive plans for deploying necessary infrastructure in each county, including coordination across contiguous counties.
Moneys appropriated for purposes of this section may be used to fund projects that deploy broadband infrastructure to unserved nonresidential facilities used for local and state emergency response activities, including, but not limited to, fairgrounds.
The commission shall establish the following accounts within the fund:
The Broadband Infrastructure Grant Account.
All moneys in the California Advanced Services Fund, including moneys in the accounts within the fund, shall be available, upon appropriation by the Legislature, to the commission for the California Advanced Services Fund program administered by the commission pursuant to this section, including the costs incurred by the commission in developing, implementing, and administering the program and the fund.
In administering the Broadband Infrastructure Grant Account, the commission shall do all of the following:
The commission shall award grants from the Broadband Infrastructure Grant Account on a technology-neutral basis, taking into account the useful economic life of capital investments, and including both wireline and wireless technology.
The commission shall consult with regional consortia, stakeholders, local governments, existing facility-based broadband providers, and consumers regarding unserved areas and cost-effective strategies to achieve the broadband access goal through public workshops conducted at least annually no later than April 30 of each year.
The commission shall identify unserved rural and urban areas and delineate the areas in the annual report prepared pursuant to Section 914.7.
An existing facility-based broadband provider may, but is not required to, apply for funding from the Broadband Infrastructure Grant Account to make an upgrade pursuant to this subdivision.
Projects eligible for grant awards shall deploy infrastructure capable of providing broadband access at speeds of a minimum of 100 mbps downstream and 20 mbps upstream, or the most current broadband definition speed standard set by the Federal Communications Commission from time to time, as determined appropriate by the commission, whichever broadband access speed is greater, to unserved areas or unserved households.
An individual household or property owner shall be eligible to apply for a grant to offset the costs of connecting the household or property to an existing or proposed facility-based broadband provider. Any infrastructure built to connect a household or property with funds provided under this paragraph shall become the property of, and part of, the network of the facility-based broadband provider to which it is connected.
In approving a project pursuant to this paragraph, the commission shall consider limiting funding to households based on income so that funds are provided only to households that would not otherwise be able to afford a line extension to the property, limiting the amount of grants on a per-household basis, and requiring a percentage of the project to be paid by the household or the owner of the property.
The aggregate amount of grants awarded pursuant to this paragraph shall not exceed five million dollars ($5,000,000).
An entity that is not a telephone corporation shall be eligible to apply to participate in the program administered by the commission pursuant to this section to provide access to broadband to an unserved area if the entity otherwise meets the eligibility requirements and complies with program requirements established by the commission.
The commission shall provide each applicant, and any party challenging an application, the opportunity to demonstrate actual levels of broadband service in the project area, which the commission shall consider in reviewing the application.
The commission shall establish a service list of interested parties to be notified of any California Advanced Services Fund applications. Any application and any amendment to an application for project funding shall be served to those on the service list and posted on the commission’s internet website at least 30 days before publishing the corresponding draft resolution.
A grant awarded pursuant to this subdivision may include funding for the following costs consistent with paragraph (5):
Costs directly related to the deployment of infrastructure.
Costs to lease access to property or for internet backhaul services for a period not to exceed five years.
Costs incurred by an existing facility-based broadband provider to upgrade its existing facilities to provide for interconnection.
The commission may award grants to fund all or a portion of the project. The commission shall determine, on a case-by-case basis, the level of funding to be provided for a project and shall consider factors that include, but are not limited to, the location and accessibility of the area, the existence of communication facilities that may be upgraded to deploy broadband, and whether the project makes a significant contribution to achievement of the program goal.
Moneys in the Rural and Urban Regional Broadband Consortia Grant Account shall be available for grants to eligible consortia to facilitate deployment of broadband services by assisting infrastructure applicants in the project development or grant application process. An eligible consortium may include, as specified by the commission, representatives of organizations, including, but not limited to, local and regional government, public safety, elementary and secondary education, health care, libraries, postsecondary education, community-based organizations, tourism, parks and recreation, agricultural, business, workforce organizations, and air pollution control or air quality management districts, and is not required to have as its lead fiscal agent an entity with a certificate of public convenience and necessity.
Each consortium shall conduct an annual audit of its expenditures for programs funded pursuant to this subdivision and shall submit to the commission an annual report that includes both of the following:
A description of activities completed during the prior year, how each activity promotes the deployment of broadband services, and the cost associated with each activity.
The number of project applications assisted.
All remaining moneys in the Broadband Infrastructure Revolving Loan Account that are unencumbered as of January 1, 2018, shall be transferred into the Broadband Infrastructure Grant Account.
All repayments of loans funded by the former Broadband Infrastructure Revolving Loan Account shall be deposited into the Broadband Infrastructure Grant Account.
Moneys deposited into the Broadband Public Housing Account shall be available for grants and loans to low-income communities to finance projects to connect broadband networks that offer free broadband service that meets or exceeds state standards, as determined by the commission, for residents of the low-income communities. A low-income community may be an eligible applicant if the low-income community does not have access to any broadband service provider that offers free broadband service that meets or exceeds state standards, as determined by the commission, for the residents of the low-income community.
To the extent feasible, the commission shall approve projects for funding from the Broadband Public Housing Account in a manner that reflects the statewide distribution of low-income communities.
In reviewing a project application under this subdivision, the commission shall consider the availability of other funding sources for that project, any financial contribution from the broadband service provider to the project, the availability of any other public or private broadband adoption or deployment program, including tax credits and other incentives, and whether the applicant has sought funding from, or participated in, any reasonably available program. The commission may require an applicant to provide match funding, and shall not deny funding for a project solely because the applicant is receiving funding from another source.
The commission shall prioritize grants pursuant to this subdivision to those existing publicly supported housing developments that have not yet received a grant pursuant to this subdivision and do not have access to free broadband internet service onsite.
Moneys in the Broadband Adoption Account shall be available to the commission to award grants to increase publicly available or after school broadband access and digital inclusion, such as grants for digital literacy training programs and public education to communities with limited broadband adoption, including low-income communities, senior communities, and communities facing socioeconomic barriers to broadband adoption.
Eligible applicants are local governments, senior centers, schools, public libraries, nonprofit organizations, including nonprofit religious organizations, and community-based organizations with programs to increase publicly available or after school broadband access and digital inclusion, such as digital literacy training programs.
Payment pursuant to a grant for digital inclusion shall be based on digital inclusion metrics established by the commission that may include the number of residents trained, the number of residents served, or the actual verification of broadband subscriptions resulting from the program funded by the grant.
The commission shall give preference to programs in communities with demonstrated low broadband access, including low-income communities, senior communities, and communities facing socioeconomic barriers to broadband adoption. The commission shall determine how best to prioritize projects for funding pursuant to this paragraph.
Moneys awarded pursuant to this subdivision shall not be used to subsidize the costs of providing broadband service to households.
The commission shall post on the home page of the California Advanced Services Fund on its internet website a list of all pending applications, application challenge deadlines, and notices of amendments to pending applications.
The commission shall require each entity that receives funding or financing for a project pursuant to this section to report monthly to the commission, at minimum, all of the following information:
The name and contractor’s license number of each licensed contractor and subcontractor undertaking a contract or subcontract in excess of twenty-five thousand dollars ($25,000) to perform work on a project funded or financed pursuant to this section.
The location where a contractor or subcontractor described in subparagraph (A) will be performing that work.
The anticipated dates when that work will be performed.
The commission shall, on a monthly basis, post the information reported pursuant to this subdivision on the commission’s California Advanced Services Fund internet website.
The commission shall notify the appropriate policy committees of the Legislature on the date on which the goal specified in subparagraph (A) of paragraph (1) of subdivision (b) is achieved.
Upon the deposit of state or federal infrastructure moneys into the Federal Funding Account, the commission shall implement a program using those moneys to expeditiously connect unserved and underserved communities by applicable federal deadlines.
Projects funded pursuant to this subdivision shall be implemented consistent with Part 35 of Title 31 of the Code of Federal Regulations and any conditions or guidelines applicable to these one-time federal infrastructure moneys.
Of the two billion dollars ($2,000,000,000) appropriated to the commission to fund last-mile broadband infrastructure in the Budget Act of 2021, the commission shall allocate those moneys to applicants for the construction of last-mile broadband infrastructure as follows:
The commission shall initially allocate one billion dollars ($1,000,000,000) for last-mile broadband projects in urban counties as follows:
The commission shall first allocate five million dollars ($5,000,000) for last-mile broadband projects in each urban county.
The commission shall allocate the remaining moneys based on each urban county’s proportionate share of the California households without access to broadband internet access service with at least 100 megabits per second download speeds, as identified and validated by the commission pursuant to the most recent broadband data collection, as of July 1, 2021, as ordered in commission Decision 16-12-025 (December 1, 2016), Decision Analyzing the California Telecommunications Market and Directing Staff to Continue Data Gathering, Monitoring and Reporting on the Market.
The commission shall allocate at least one billion dollars ($1,000,000,000) for last-mile broadband projects in rural counties as follows:
The commission shall first allocate five million dollars ($5,000,000) for last-mile broadband projects in each rural county.
The commission shall allocate the remaining moneys based on each rural county’s proportionate share of the California households without broadband internet access service with at least 100 megabits per second download speeds, as identified and validated by the commission pursuant to the most recent broadband data collection, as of July 1, 2021, as ordered in commission Decision 16-12-025 (December 1, 2016), Decision Analyzing the California Telecommunications Market and Directing Staff to Continue Data Gathering, Monitoring and Reporting on the Market.
Until September 30, 2024, applicants may apply for and encumber moneys allocated pursuant to this subdivision for last-mile broadband projects. Any moneys allocated pursuant to this subdivision that are not encumbered on or before September 30, 2024, shall be made available to the commission to allocate for the construction of last-mile broadband infrastructure anywhere in the state.
Beginning January 1, 2022, the commission may impose the surcharge pursuant to paragraph (4) of subdivision (d) of Section 281 to fund the California Advanced Services Fund pursuant to Section 281 until December 31, 2032.
The Broadband Loan Loss Reserve Fund is hereby established in the State Treasury. Notwithstanding Section 13340 of the Government Code, moneys in the fund are hereby continuously appropriated, without regard to fiscal years, to the commission and shall be available to fund costs related to the financing of the deployment of broadband infrastructure by a local government agency or nonprofit organization, including, but not limited to, payment of costs of debt issuance, obtaining credit enhancement, and establishment and funding of reserves for the payment of principal and interest on the debt.
In the 2021–22 fiscal year, the commission may make cashflow loans to the Broadband Loan Loss Reserve Fund from accounts established pursuant to subdivision (c) of Section 281.
The commission may establish, among other things, eligibility requirements, financing terms and conditions, and allocation criteria, for infrastructure projects deployed using financing supported in whole or in part by funds allocated pursuant to this section.
The commission may require a local government agency or nonprofit organization to provide information demonstrating the agency’s or nonprofit organization’s ability to reasonably finance and implement the infrastructure project deployed using financing supported in whole or in part by funds allocated pursuant to this section.
The commission shall require each local government agency or nonprofit organization receiving funds under this section to file both of the following reports in the form and manner specified by the commission:
Biannual progress reports identifying project milestones and percent completions to date, and including other information as the commission may prescribe.
A completion report, including a full description of the completed project, comparison of approved versus actual costs of construction, speed test data for all areas served by the project, and other information as the commission may prescribe.
The commission, in collaboration with relevant state agencies and stakeholders, shall maintain and update a statewide, publicly accessible, and interactive map showing the accessibility of broadband service in the state, including, but not limited to, information identifying the percentage of each census block that has broadband service meeting federal and state standards. The map shall identify, for each address in the state, each provider of broadband services that offers service at the address and the maximum speed of broadband services offered by each provider of broadband services at the address.
The map required pursuant to subdivision (a) shall also include all of the following features to receive self-reported data:
A feature for users to disclose how much they pay for stand-alone or bundled broadband service.
A feature for users to identify the internet service provider to which they subscribe for broadband service.
A feature for users to disclose the maximum speed for broadband service to which they subscribe.
A feature that allows individuals to refute the broadband speed or technology, or both, that an internet service provider claims to offer at an address.
A feature that allows individuals to identify barriers to broadband access.
The features and self-reported data required pursuant to subdivisions (b) and (h) shall be made publicly available and expressed at the address for which the data was submitted. The commission shall obtain consent from an individual before publicly disclosing information that the individual submits pursuant to subdivision (b) or (h).
The commission may collect from providers of broadband services information necessary to establish and update the map required pursuant to this section.
The commission shall also create a notification feature on the map for individuals. Using this feature, an individual may sign up to be notified when updates are made to the map.
The commission may collect information from providers of broadband services at the address level.
The commission shall not, pursuant to subdivision (a), (d), or (e), disclose residential subscriber information protected by Section 2891.
The map required pursuant to subdivision (a) shall include a feature for users to submit a verified speed test at their location.
The commission shall not accept information collected by the commission pursuant to subdivisions (b) and (c) as evidence in a commission proceeding unless the commission validates the accuracy of the self-reported information.
For purposes of this section, the following definitions apply:
“Broadband” has the same meaning as defined in Section 5830.
“Verified speed test” means a broadband speed performance test result that was measured and verified using a reputable application specified by the commission for that purpose.
Any moneys that are deposited in funds created pursuant to this chapter shall not be used by the state for any purpose other than as specified in this chapter. Notwithstanding any other provision of law, the Controller may use the funds created pursuant to this chapter for loans to the General Fund as provided in Sections 16310 and 16381 of the Government Code and, upon approval of the Director of Finance, moneys deposited in funds created pursuant to this chapter may be used to make transfers as loans to other funds created pursuant to this chapter.
As used in this section, “interconnected Voice over Internet Protocol (VoIP) service” has the same meaning as in Section 9.3 of Title 47 of the Code of Federal Regulations.
The Legislature finds and declares that the sole purpose of this section is to require the commission to impose the surcharges pursuant to this section to ensure that end-use customers of interconnected VoIP service providers contribute to the funds enumerated in this section, and, therefore, this section does not indicate the intent of the Legislature with respect to any other purpose.
The commission shall require interconnected VoIP service providers to collect and remit surcharges on their California intrastate revenues in support of the following public purpose program funds:
California High-Cost Fund-A Administrative Committee Fund under Section 275.
California High-Cost Fund-B Administrative Committee Fund under Section 276.
Universal Lifeline Telephone Service Trust Administrative Committee Fund under Section 277.
Deaf and Disabled Telecommunications Program Administrative Committee Fund under Section 278.
California Teleconnect Fund Administrative Committee Fund under Section 280.
California Advanced Services Fund under Section 281.
The authority to impose a surcharge pursuant to this section applies only to a surcharge imposed on end-use customers for interconnected VoIP service provided to an end-use customer’s place of primary use that is located within California. As used in this subdivision, “place of primary use” means the street address where the end-use customer’s use of interconnected VoIP service primarily occurs, or a reasonable proxy as determined by the interconnected VoIP service provider, such as the customer’s registered location for 911 purposes.
CHAPTER 2. The Public Utilities Commission: Organization [301. - 327.]
The membership of the Public Utilities Commission, and the qualifications and tenure of the members of the commission are as provided in Section 1 of Article XII of the Constitution of this state.
Each commissioner shall, before entering upon the duties of his office, take and subscribe the constitutional oath of office.
A public utilities commissioner may not hold an official relation to, nor have a financial interest in, a person or corporation subject to regulation by the commission. If any commissioner acquires a financial interest in a corporation or person subject to regulation by the commission other than voluntarily, his or her office shall become vacant unless within a reasonable time he or she divests himself or herself of the interest.
No executive of a public utility may serve as commissioner within two years after leaving the employment of the utility.
The commission shall maintain an updated Conflict of Interest Code and Statement of Incompatible Activities in a manner consistent with applicable law.
The annual salary of each commissioner is provided for by Chapter 6 (commencing with Section 11550) of Part 1 of Division 3 of Title 2 of the Government Code. The commissioners shall be civil executive officers, and their salaries as fixed by law shall be paid in the same manner as are the salaries of other state officers.
The Governor shall designate a president of the commission from among the members of the commission. The president shall direct the executive director, the attorney, and other staff of the commission, except for the staff of the Public Advocate’s Office of the Public Utilities Commission, in the performance of their duties, in accordance with commission policies and guidelines. The president shall preside at all meetings and sessions of the commission.
The office of the commission shall be in the City and County of San Francisco. The office shall always be open, legal holidays and nonjudicial days excepted. The commission shall hold its sessions at least once in each calendar month. The commission may also meet at such other times and in such places as may be expedient and necessary for the proper performance of its duties, and for that purpose may rent quarters or offices.
The meetings of the commission shall be open and public in accordance with the provisions of Article 9 (commencing with Section 11120) of Chapter 1 of Part 1 of Division 3 of Title 2 of the Government Code.
In addition to the requirements of Section 11125 of the Government Code, the commission shall include in its notice of meetings the agenda of business to be transacted, and no item of business shall be added to the agenda subsequent to the notice in the absence of an unforeseen emergency situation. A rate increase shall not constitute an unforeseen emergency situation. As used in this subdivision, “meeting” shall include all investigations, proceedings, and showings required by law to be open and public.
The commission shall have a seal, bearing the inscription “Public Utilities Commission State of California.” The seal shall be affixed to all writs and authentications of copies of records and to such other instruments as the commission shall direct.
The commission may procure all necessary books, maps, charts, stationery, instruments, office furniture, apparatus, and appliances.
The commission may appoint as attorney to the commission an attorney at law of this state, who shall hold office during the pleasure of the commission.
The attorney shall represent and appear for the people of the State of California and the commission in all actions and proceedings involving any question under this part or under any order or act of the commission. If directed to do so by the president, except as otherwise directed by vote of the commission, the attorney shall intervene, if possible, in any action or proceeding in which any such question is involved.
The attorney shall commence, prosecute, and expedite the final determination of all actions and proceedings directed or authorized by the president, except as otherwise directed or authorized by vote of the commission, advise the commission and each commissioner, when so requested, in regard to all matters in connection with the powers and duties of the commission and the members thereof, and generally perform all duties and services as attorney to the commission that the president, or vote of the commission, may require of him.
There is within the legal division of the commission an ethics officer who shall be designated by the general counsel. The ethics officer shall be responsible for both of the following:
Instituting a program of enhanced ethics training for all commissioners and employees of the commission, including training concerning the commission’s Conflict of Interest Code, Statement of Incompatible Activities, and limitations upon ex parte communications.
Providing confidential advice to commissioners and employees of the commission on compliance with the commission’s Conflict of Interest Code, Statement of Incompatible Activities, and limitations upon ex parte communications. The ethics officer shall maintain the confidentiality of the commissioner’s or employee’s identity unless the commissioner or employee expressly indicates a desire to communicate his or her identity to the commission.
The commission shall appoint a chief administrative law judge, who shall hold office at the pleasure of the commission.
The chief administrative law judge shall be responsible for the oversight of the administrative law judge division and shall organize, coordinate, supervise, and direct the operations of the division as directed by the commission, consistent with commission policies and priorities.
The commission shall appoint a chief internal auditor, who shall hold office at the pleasure of the commission.
The chief internal auditor shall be responsible for the oversight of the internal audit unit and shall plan, initiate, and perform audits of key financial, management, operational, and information technology functions within the commission to improve accountability and transparency to executive and state management.
The chief internal auditor shall report his or her findings and recommendations directly to an audit subcommittee of the commission.
The chief internal auditor shall comply with Part 3.5 (commencing with Section 13885) of Division 3 of Title 2 of the Government Code.
The commission shall appoint an executive director, who shall hold office during its pleasure. The executive director shall be responsible for the commission’s executive and administrative duties and shall organize, coordinate, supervise, and direct the operations and affairs of the commission and expedite all matters within the commission’s jurisdiction.
The executive director shall keep a full and true record of all proceedings of the commission, issue all necessary process, writs, warrants, and notices, and perform such other duties as the president, or vote of the commission, prescribes. The president may authorize the executive director to dismiss complaints or applications when all parties are in agreement thereto, in accordance with rules that the commission may prescribe.
The commission may appoint assistant executive directors who may serve warrants and other process in any county or city and county of this state.
Persons employed as investigators and investigator supervisors by the commission, who are designated by the commission’s executive director and approved by the commission, have the authority of peace officers, as specified in paragraph (5) of subdivision (a) of Section 830.11 of the Penal Code, while engaged in exercising the powers granted to or performing the duties imposed upon them in investigating the laws, orders, or regulations administered by the commission or commencing directly or indirectly any criminal prosecution arising from any investigation conducted under these laws. All persons herein referred to shall be deemed to be acting within the scope of employment with respect to all acts and matters set forth in this section.
The executive director may employ such officers, administrative law judges, experts, engineers, statisticians, accountants, inspectors, clerks, and employees as the executive director deems necessary to carry out the provisions of this part or to perform the duties and exercise the powers conferred upon the commission by law. All officers and employees shall receive such compensation as is fixed by the commission.
The executive director may authorize commission employees to undertake temporary training and development assignments with other agencies, departments, and commissions that undertake coordinated activities with the commission, including the Energy Commission, the State Air Resources Board, and the Geologic Energy Management Division.
The Governor may appoint one adviser for each member of the commission upon the request of the commission member. Each adviser shall receive a salary fixed by the commission with the approval of the Department of Human Resources. The total number of advisers exempt from civil service may not exceed five.
There is within the commission an independent Public Advocate’s Office of the Public Utilities Commission to represent and advocate on behalf of the interests of public utility customers and subscribers within the jurisdiction of the commission. The goal of the office shall be to obtain the lowest possible rate for service consistent with reliable and safe service levels. For revenue allocation and rate design matters, the office shall primarily consider the interests of residential and small commercial customers.
The director of the office shall be appointed by, and serve at the pleasure of, the Governor, subject to confirmation by the Senate.
The director shall annually appear before the appropriate policy committees of the Assembly and the Senate to report on the activities of the office.
The director shall develop a budget for the office that shall be subject to final approval of the Department of Finance. As authorized in the approved budget, the office shall employ personnel and resources, including attorneys and other legal support staff, at a level sufficient to ensure that customer and subscriber interests are effectively represented in all significant proceedings. The office may employ experts necessary to carry out its functions. The director may appoint a lead attorney who shall represent the office, and shall report to and serve at the pleasure of the director. The lead attorney for the office shall obtain adequate legal personnel for the work to be conducted by the office from the commission’s attorney appointed pursuant to Section 307. The commission’s attorney shall timely and appropriately fulfill all requests for legal personnel made by the lead attorney for the office, provided the office has sufficient moneys and positions in its budget for the services requested.
The commission shall develop appropriate procedures to ensure that the existence of the office does not create a conflict of roles for any employee. The procedures shall include, but shall not be limited to, the development of a code of conduct and procedures for ensuring that advocates and their representatives on a particular case or proceeding are not advising decisionmakers on the same case or proceeding.
The office may compel the production or disclosure of any information it deems necessary to perform its duties from any entity regulated by the commission, provided that any objections to any request for information shall be decided in writing by the assigned commissioner or by the president of the commission, if there is no assigned commissioner.
There is hereby created the Public Utilities Commission Public Advocate’s Office Account in the General Fund. Moneys from the Public Utilities Commission Utilities Reimbursement Account in the General Fund shall be transferred in the annual Budget Act to the Public Utilities Commission Public Advocate’s Office Account. The funds in the Public Utilities Commission Public Advocate’s Office Account shall be a budgetary program fund administered and utilized exclusively by the office in the performance of its duties as determined by the director. The director shall annually submit a staffing report containing a comparison of the staffing levels for each five-year period.
On or before January 10 of each year, the office shall provide to the chairperson of the fiscal committee of each house of the Legislature and to the Joint Legislative Budget Committee all of the following information:
The number of personnel years utilized during the prior year by the office.
The total dollars expended by the office in the prior year, the estimated total dollars expended in the current year, and the total dollars proposed for appropriation in the following budget year.
Workload standards and measures for the office.
The office shall meet and confer in an informal setting with a regulated entity prior to issuing a report or pleading to the commission regarding alleged misconduct, or a violation of a law or a commission rule or order, raised by the office in a complaint. The meet and confer process shall be utilized in good faith to reach agreement on issues raised by the office regarding any regulated entity in the complaint proceeding.
The commission shall adopt procedures on the disqualification of commissioners and administrative law judges due to bias or prejudice similar to those of other state agencies and superior courts.
For ratesetting and adjudicatory proceedings, a commissioner or administrative law judge shall be disqualified for bias or prejudice based on either of the following:
Actions taken during the proceeding that demonstrate bias or prejudice.
Actions taken outside the public record of a proceeding demonstrating any commitment to provide relief to a party.
Past work experience by the commissioner or administrative law judge shall not be a sufficient basis for demonstrating bias or prejudice pursuant to paragraph (1).
The commission procedures shall not authorize a commissioner or administrative law judge to rule on a motion made by a party to a proceeding to disqualify the commissioner or administrative law judge due to bias or prejudice.
The commission shall develop the procedures with the opportunity for public review and comment.
The division of the commission responsible for railroad safety shall be responsible for inspection, surveillance, and investigation of the rights-of-way, facilities, equipment, and operations of railroads and public mass transit guideways, and for enforcing state and federal laws, regulations, orders, and directives relating to transportation of persons or commodities, or both, of any nature or description by rail. The division of the commission responsible for railroad safety shall advise the commission on all matters relating to rail safety, and shall propose to the commission rules, regulations, orders, and other measures necessary to reduce the dangers caused by unsafe conditions on the railroads of the state. The delegation of enforcement responsibility to the division of the commission responsible for railroad safety shall not diminish the power of other agencies of state government to enforce laws relating to employee or environmental safety, pollution prevention, or public health and safety.
In performing its duties, the division of the commission responsible for railroad safety shall exercise all powers of investigation granted to the commission, including rights to enter upon land or facilities, inspect books and records, and compel testimony. The commission shall employ sufficient federally certified inspectors to ensure at the time of inspection that railroad locomotives and equipment and facilities located in class I railroad yards in California are inspected not less frequently than every 180 days, and all main and branch line tracks are inspected not less frequently than every 12 months. In performing its duties, the division of the commission responsible for railroad safety shall consult with representatives of railroad corporations, labor organizations representing railroad employees, and the Federal Railroad Administration.
The general counsel shall assign to the division of the commission responsible for railroad safety the personnel and attorneys necessary to fully utilize the powers granted to the commission by any state law and by any federal law relating to rail transportation, to enforce safety laws, rules, regulations, and orders, and to collect fines and penalties resulting from the violation of any safety rule or regulation.
The activities of the division of the commission responsible for railroad safety that relate to safe operation of common carriers by rail, other than those relating to grade crossing protection, shall also be supported by the fees paid by railroad corporations, if any, pursuant to Sections 421 to 424, inclusive. The activities of the division of the commission responsible for railroad safety that relate to grade crossing protection shall be supported by funds appropriated therefor from the State Highway Account in the State Transportation Fund.
No vacancy in the commission impairs the right of the remaining commissioners to exercise all the powers of the commission. A majority of the commissioners constitutes a quorum for the transaction of any business, for the performance of any duty, or for the exercise of any power of the commission. Any investigation, inquiry, or hearing which the commission may undertake or hold may be undertaken or held by or before any commissioner or commissioners designated for the purpose by the commission. The evidence in any investigation, inquiry, or hearing may be taken by the commissioner or commissioners to whom the investigation, inquiry, or hearing has been assigned or, in his, her, or their behalf, by an administrative law judge designated for that purpose. Every finding, opinion, and order made by the commissioner or commissioners so designated, pursuant to the investigation, inquiry, or hearing, when approved or confirmed by the commission and ordered filed in its office, is the finding, opinion, and order of the commission.
The commission, each commissioner, the executive director, and the assistant executive directors may administer oaths, certify to all official acts, and issue subpoenas for the attendance of witnesses and the production of papers, waybills, books, accounts, documents, and testimony in any inquiry, investigation, hearing, or proceeding in any part of the state.
The administrative law judges may administer oaths, examine witnesses, issue subpoenas, and receive evidence, under rules that the commission adopts.
The evidence in any hearing shall be taken by the commissioner or the administrative law judge designated for that purpose. The commissioner or the administrative law judge may receive and exclude evidence offered in the hearing in accordance with the rules of practice and procedure of the commission.
Consistent with the procedures contained in Sections 1701.1, 1701.2, 1701.3, 1701.4, and 1701.8, the assigned commissioner or the administrative law judge shall prepare and file an opinion setting forth recommendations, findings, and conclusions. The opinion of the assigned commissioner or the administrative law judge is the proposed decision and a part of the public record in the proceeding. The proposed decision of the assigned commissioner or the administrative law judge shall be filed with the commission and served upon all parties to the action or proceeding without undue delay, not later than 90 days after the matter has been submitted for decision. The commission shall issue its decision not sooner than 30 days following filing and service of the proposed decision by the assigned commissioner or the administrative law judge, except that the 30-day period may be reduced or waived by the commission in an unforeseen emergency situation or upon the stipulation of all parties to the proceeding or as otherwise provided by law. The commission may, in issuing its decision, adopt, modify, or set aside the proposed decision or any part of the decision. Where the modification is of a decision in an adjudicatory hearing it shall be based upon the evidence in the record. Every finding, opinion, and order made in the proposed decision and approved or confirmed by the commission shall, upon that approval or confirmation, be the finding, opinion, and order of the commission.
Any item appearing on the commission’s public agenda as an alternate item to a proposed decision or to a decision subject to subdivision (g) shall be served upon all parties to the proceeding without undue delay and shall be subject to public review and comment before it may be voted upon. For purposes of this subdivision, “alternate” means either a substantive revision to a proposed decision that materially changes the resolution of a contested issue or any substantive addition to the findings of fact, conclusions of law, or ordering paragraphs. The commission shall adopt rules that provide for the time and manner of review and comment and the rescheduling of the item on a subsequent public agenda, except that the item shall not be rescheduled for consideration sooner than 30 days following service of the alternate item upon all parties. The alternate item shall be accompanied by a digest that clearly explains the substantive revisions to the proposed decision. The commission’s rules may provide that the time and manner of review and comment on an alternate item may be reduced or waived by the commission in an unforeseen emergency situation.
The commission may specify that the administrative law judge assigned to a proceeding involving an electrical, gas, telephone, railroad, or water corporation, or a highway carrier, initiated by customer or subscriber complaint need not prepare, file, and serve an opinion, unless the commission finds that to do so is required in the public interest in a particular case.
Before voting on any commission decision not subject to subdivision (d), the decision shall be served on parties and subject to at least 30 days public review and comment. Any alternate to any commission decision shall be subject to the same requirements as provided for alternate decisions under subdivision (e). For purposes of this subdivision, “decision” also includes resolutions, including resolutions on advice letter filings.
The 30-day period may be reduced or waived in an unforeseen emergency situation, upon the stipulation of all parties in the proceeding, for an uncontested matter in which the decision grants the relief requested, or for an order seeking temporary injunctive relief, or, in the case of a catastrophic wildfire proceeding, may be reduced to no less than 15 days at the discretion of the assigned commissioner.
This subdivision does not apply to uncontested matters that pertain solely to water corporations, or to orders instituting investigations or rulemakings, categorization resolutions under Sections 1701.1 to 1701.4, inclusive, and Section 1701.8, or orders authorized by law to be considered in executive session. Consistent with regulatory efficiency and the need for adequate prior notice and comment on commission decisions, the commission may adopt rules, after notice and comment, establishing additional categories of decisions subject to waiver or reduction of the time period in this section.
Notwithstanding any other law, amendments, revisions, or modifications by the commission of its Rules of Practice and Procedure shall be submitted to the Office of Administrative Law for prior review in accordance with Sections 11349, 11349.3, 11349.4, 11349.5, 11349.6, and 11350.3 of, and subdivisions (a) and (b) of Section 11349.1 of, the Government Code. If the commission adopts an emergency revision to its Rules of Practice and Procedure based upon a finding that the revision is necessary for the preservation of the public peace, health and safety, or general welfare, this emergency revision shall only be reviewed by the Office of Administrative Law in accordance with subdivisions (b) to (d), inclusive, of Section 11349.6 of the Government Code. The emergency revision shall become effective upon filing with the Secretary of State and shall remain in effect for no more than 120 days. A petition for writ of review pursuant to Section 1756 of a commission decision amending, revising, or modifying its Rules of Practice and Procedure shall not be filed until the regulation has been approved by the Office of Administrative Law, the Governor, or a court pursuant to Section 11350.3 of the Government Code. If the period for filing the petition for writ of review would otherwise have already commenced under Section 1733 or 1756 at the time of that approval, then the period for filing the petition for writ of review shall continue until 30 days after the date of that approval. This subdivision does not require the commission to comply with Article 5 (commencing with Section 11346) of Chapter 3.5 of Part 1 of Division 3 of Title 2 of the Government Code. This subdivision is only intended to provide for the Office of Administrative Law review of procedural commission decisions relating to commission Rules of Practice and Procedure, and not general orders, resolutions, regulations, guidelines related to the California Environmental Quality Act (Division 13 (commencing with Section 21000) of the Public Resources Code), or other substantive regulations.
The commission shall immediately notify the Legislature whenever the commission reduces or waives the time period for public review and comment due to an unforeseen emergency situation, as provided in subdivision (d), (e), or (g).
Notwithstanding any other provision of law, the commission shall not consider or require, in determining qualified bidders for, or in awarding contracts, that any facilities be located within a particular area of the state, or within geographical proximity of any particular area of the state.
The commission shall adopt procedures authorizing the submittal of electronic signatures and documents by all parties on contracts involving the commission.
On or after July 1, 2001, the commission shall establish procedures to permit the submission of informal complaints through electronic means in accordance with this section.
On or before January 1, 2002, the commission shall provide on its Internet Web site the means by which consumers may submit informal complaints through electronic means.
For the purpose of this section, “electronic means” includes, but shall not be limited to, email or the Internet, or both.
Upon the receipt of an informal complaint submitted by electronic means, the commission shall immediately forward the complaint to the entity named in the complaint.
The commission shall permit the submission of informal complaints through electronic means, if, as determined by the commission, both of the following conditions are met:
The dollar amount in the complaint does not exceed the jurisdictional limit of a small claims court specified in subdivision (a) of Section 116.220 or Section 116.221 of the Code of Civil Procedure.
The commission has addressed any impediments in the electronic systems employed by the commission that would prevent or substantially adversely affect the ability of the commission to receive informal complaints by electronic means.
The commission shall include a notice on its Internet Web site of the availability of the procedures described in subdivision (a).
For the purposes of implementing this section, the commission shall make available to the public an industry specific online complaint form that allows a customer to specify information that the commission determines to be relevant for purposes of resolving a dispute, including the account number, the type of dispute, and the opportunity to make general comments.
This act may not be implemented, and no information technology-related preparatory work may be undertaken in connection with this act prior to July 1, 2001, without the concurrence of the commission and the authorization of the Department of Information Technology pursuant to Executive Order D-3-99.
Prior to commencement of any meeting at which commissioners vote on items on the public agenda, the commission shall make available to the public copies of the agenda, and upon request, any agenda item documents that are proposed to be considered by the commission for action or decision at a commission meeting.
In addition, the commission shall publish the agenda, agenda item documents, and adopted decisions in a manner that makes copies of them easily available to the public, including publishing those documents on the Internet. Publication of the agenda and agenda item documents shall occur on the Internet at the same time as the written agenda and agenda item documents are made available to the public.
The commission shall publish and maintain the following documents on the Internet:
Each of the commission’s proposed and alternate proposed decisions and resolutions, until the decision or resolution is adopted and published.
Each of the commission’s adopted decisions and resolutions. The publication shall occur within 10 days of the adoption of each decision or resolution by the commission.
The then-current version of the commission’s general orders and Rules of Practice and Procedure.
Each of the commission’s rulings. The commission shall maintain those rulings on its Internet Web site until final disposition, including disposition of any judicial appeals, of the respective proceedings in which the rulings were issued.
A docket card that lists, by title and date of filing or issuance, all documents filed and all decisions or rulings issued in those proceedings, including the public versions of all prepared oral and written testimony and advice letter filings, protests, and responses. The commission shall maintain the docket card until final disposition, including disposition of any judicial appeals, of the corresponding proceedings.
The commission shall make the following information available on the Internet:
The commission and each commissioner may issue writs of summons, subpenas, warrants of attachment, warrants of commitment, and all necessary process in proceedings for contempt, in like manner and to the same extent as courts of record. The process issued by the commission or any commissioner, extends to all parts of the State and may be served by any person authorized to serve process of courts of record, or by any person designated by the commission or a commissioner. The person executing any such process shall receive such compensation as is allowed by the commission, not to exceed the fees prescribed by law on August 8, 1915, for similar services, and such fees shall be paid in the same manner as provided in this part for payment of the fees of witnesses.
The commission may require, by order served on any public utility, the production within this State at such time and place as it designates, of any books, accounts, papers, or records kept by the public utility in any office or place without this State, or, at its option, verified copies in lieu thereof, so that an examination thereof may be made by the commission or under its direction.
The commission, each commissioner, and each officer and person employed by the commission may, at any time, inspect the accounts, books, papers, and documents of any public utility. The commission, each commissioner, and any officer of the commission or any employee authorized to administer oaths may examine under oath any officer, agent, or employee of a public utility in relation to its business and affairs. Any person, other than a commissioner or an officer of the commission, demanding to make any inspection shall produce, under the hand and seal of the commission, authorization to make the inspection. A written record of the testimony or statement so given under oath shall be made and filed with the commission.
Subdivision (a) also applies to inspections of the accounts, books, papers, and documents of any business that is a subsidiary or affiliate of, or a corporation that holds a controlling interest in, an electrical, gas, or telephone corporation, or a water corporation that has 2,000 or more service connections, with respect to any transaction between the water, electrical, gas, or telephone corporation and the subsidiary, affiliate, or holding corporation on any matter that might adversely affect the interests of the ratepayers of the water, electrical, gas, or telephone corporation.
The commission shall apply a risk-based methodology to conduct audits or reviews of the books and records of electrical, gas, telephone, water, and sewer corporations.
The commission shall conduct a review or audit of the books and records of every electrical or gas corporation at least once every five years.
The commission shall conduct an audit or review of the books and records of every high-risk telephone, water, or sewer corporation, as determined by the commission, during the regular regulatory review of those entities, at least once every 10 years.
The commission shall post reports of reviews and audits and other pertinent information on its internet website.
The commission may conduct financial and performance reviews or audits of any entity or program created by any order, decision, motion, settlement, or other action of the commission.
The commission shall complete any review or audit in a timely manner consistent with applicable auditing standards.
After performing a review or audit pursuant to this section, the commission may conduct additional followup work that is related to any findings and recommendations related to the review or audit.
Beginning January 15, 2020, and every year thereafter, the commission shall post on its internet website its standard practice audit manual, titled Utility Audit, Finance and Compliance Branch UAFCB Audit and Attestation Standard Practice, and updates to that manual, if any.
The commission shall investigate the cause of all accidents occurring within this State upon the property of any public utility or directly or indirectly arising from or connected with its maintenance or operation, resulting in loss of life or injury to person or property and requiring, in the judgment of the commission, investigation by it, and may make such order or recommendation with respect thereto as in its judgment seems just and reasonable. Neither the order or recommendation of the commission nor any accident report filed with the commission shall be admitted as evidence in any action for damages based on or arising out of such loss of life, or injury to person or property. Every public utility shall file with the commission, under such rules as the commission prescribes, a report of each accident so occurring of such kinds or classes as the commission from time to time designates.
Each electrical corporation shall cooperate fully with the commission in an investigation into any major accident or any reportable incident, as these terms are defined by the commission, concerning overhead electric supply facilities, regardless of pending litigation or other investigations, including, but not limited to, those that may be related to a commission investigation.
After the scene of the incident has been made safe and service has been restored, each electrical corporation shall provide the commission, upon its request, immediate access to all of the following:
Any factual or physical evidence under the electrical corporation’s, or its agent’s, physical control, custody, or possession related to the incident.
The name and contact information of any known percipient witness.
Any employee percipient witness under the electrical corporation’s control.
The name and contact information of any person or entity that has taken possession of any physical evidence removed from the site of the incident.
Any and all documents under the electrical corporation’s control that are related to the incident and are not subject to attorney-client privilege or attorney work product doctrine.
Each electrical corporation shall preserve any and all documents or evidence it collects as part of its own investigation related to the incident for at least five years or a shorter period of time as authorized by the commission.
Any and all documents collected by an electrical corporation pursuant to this section shall be catalogued and preserved in an accessible manner for assessment by commission investigators as determined by the commission.
The commission may request the local agency formation commission to advise it as to any special districts as defined in Section 54775 of the Government Code who are authorized and capable of performing comparable utility service within an area for which a public utility is seeking certification.
The Legislature hereby declares that it is the policy of this state to achieve, whenever feasible and not inconsistent with sound environmental planning, the undergrounding of all future electric and communication distribution facilities which are proposed to be erected in proximity to any highway designated a state scenic highway pursuant to Article 2.5 (commencing with Section 260) of Chapter 2 of Division 1 of the Streets and Highways Code and which would be visible from such scenic highways if erected above ground. The commission shall prepare and adopt by December 31, 1972, a statewide plan and schedule for the undergrounding of all such utility distribution facilities in accordance with the aforesaid policy and the rules of the commission relating to the undergrounding of facilities.
The commission shall coordinate its activities regarding the plan with local governments and planning commissions concerned.
The commission shall require compliance with the plan upon its adoption.
This section shall not apply to facilities necessary to the operation of any railroad.
The commission shall appoint a public advisor and establish an office of the public advisor, including a separate office in the Los Angeles office of the commission. The commission may employ staff as necessary to carry out the duties of the office of the public advisor. The office of the public advisor shall assist members of the public and ratepayers who desire to testify before or present information to the commission in any hearing or proceeding of the commission. The public advisor shall advise the commission on procedural matters relating to public participation in proceedings of the commission.
The public advisor and executive director shall publicize the commission’s programs for encouraging and supporting participation in the commission’s proceedings.
The public advisor shall receive complaints and comments from members of the public concerning how the commission is carrying out its functions. The public advisor shall maintain the confidentiality of the identity of a member of the public who makes a complaint or comment unless the member of the public expressly indicates a desire to communicate his or her identity to the commission. The public advisor shall assess the nature of substantive complaints and comments from members of the public and take them into consideration when analyzing and recommending options for resolution of the matters underlying those complaints and comments.
It is the intent of the Legislature that the commission assess the consequences of its decisions, including economic effects, and assess and mitigate the impacts of its decision on customer, public, and employee safety, as part of each ratemaking, rulemaking, or other proceeding, and that this be accomplished using existing resources and within existing commission structures. The commission shall not establish a separate office or department for the purpose of evaluating and mitigating consequences of commission activities.
The commission shall take all necessary and appropriate actions to assess the economic effects of its decisions and to assess and mitigate the impacts of its decisions on customer, public, and employee safety.
The president of the commission shall annually appear before the appropriate policy committees of the Senate and Assembly to present the annual report of the commission required pursuant to Section 910.
The commission shall periodically, at least once each year, compile its rules of procedure together with every order and decision of the commission relating to the conduct of the commission’s hearings and proceedings.
The compilation shall include, but not be limited to, matters relating to all of the following:
Pleadings.
Public notice.
Public attendance.
Specification of issues.
Prehearing procedures.
Discovery.
Evidence.
Supporting documentation.
Submission of briefs and arguments.
Meetings of the commission.
All other rules of procedure governing participation in hearings and proceedings of the commission by public utilities, commission staff, and other persons.
The commission shall determine, as part of the proceeding in Rulemaking 98-07-038 (Rulemaking for purposes of Revising General Order 96-A Regarding Informal Filings at the Commission) or any other appropriate proceeding, as determined by the commission, the feasibility of submitting advice letters to the commission through electronic means. If determined to be feasible, the commission shall, within six months, propose a plan for submitting advice letters by electronic means. For purposes of this section, “electronic means” include electronic mail and electronic forms developed or approved by the commission and submitted through the commission’s Internet Web site.
Commencing January 1, 1989, the commission shall cause the complete text of each of its orders and decisions to be published within a reasonable time, not to exceed one year after issuance. The commission shall, on or before January 1, 1990, publish every significant decision or order issued, but not published, as of January 1, 1989.
With respect to the order or decision in any proceeding not assigned to an administrative law judge pursuant to subdivision (b) of Section 311, the commission may comply with subdivision (a) by publishing the docket number or other identifying number used in its recordkeeping system, the name of the case, the parties to the case, and the ordering language in the case.
If the commission participates in or uses an electronic means of publication of its orders and decisions, the commission shall assure reasonable public access to that system upon the payment of reasonable fees or charges.
For the purposes of this section, the following terms have the following meanings:
“Demand-side energy management programs” mean all energy efficiency, demand-side response, clean distributed generation, energy conservation, energy savings, or weatherization programs of the state or a local government, electrical corporations, gas corporations, or a local publicly owned electric or gas utility.
“Small business” has the same meaning as defined in Section 14837 of the Government Code.
The commission shall ensure that the Internet Web site for the Energy Upgrade California program is revised and maintained to include information related to demand-side energy management programs for small business customers.
The commission, in consultation with the Office of Small Business Advocate within the Governor’s Office of Business and Economic Development, shall ensure that adequate marketing, education, and outreach are undertaken that is directed at small business customers to enable small business customers to fully participate in ratepayer-funded demand-side energy management programs, including programs that provide financial incentives, rebates, technical assistance, and support pursuant to Sections 454.54 and 454.55.
The executive director of the commission may release to the Director of Industrial Relations any information concerning any person, corporation, or other entity under the jurisdiction and control of the commission relevant to the enforcement of the workers’ compensation laws of this state.
The Public Utilities Commission shall publish any data it collects for its clearinghouse minority and women business data base that it deems to be nonconfidential, including, but not limited to, company name, address, telephone number, fax number, point of contact, federal Standard Industrial Classification (SIC) code, ethnicity code, gender code, and business description, for use by governmental agencies and the public who request the information. Publication of the data base shall be done on a semiannual basis and shall be made available in hardcopy and softcopy (computer disk). The data base shall also be made available electronically via a computer-accessed bulletin board service (BBS).
The commission may impose fees on the requesters of information commensurate with its cost to publish, duplicate, or provide computer access to the data base.
No less frequently than once a year, the commission shall make the following information about each contract that the commission enters into available free of charge on its Internet Web site:
The names, addresses, and points of contact of the parties to the contract.
The goods and services requested, as applicable.
The contract value.
The commission shall make available on its Internet Web site audits conducted by the Department of General Services of the commission’s contracting practices.
The Legislature hereby finds and declares that the commission should have the authority to act swiftly to expedite planning for the long-term recovery in parts of the state which have been declared national disaster areas and in which severe damage to or destruction of existing utility facilities has occurred and to adopt expedited procedures for that purpose.
The commission shall, therefore, review existing rules, regulations, and orders and develop and adopt new rules, regulations, or orders, as may be appropriate or necessary to establish expedited procedures to be followed in the event that a determination is made by the President of the United States that an emergency exists, of the severity and magnitude that effective response is beyond the capabilities of the state and the affected local governments and that federal assistance is necessary pursuant to Section 5191 of Title 42 of the United States Code Annotated. The procedures shall require a determination by the commission, upon application of a utility or other interested party, that the emergency has resulted in severe damage or destruction to an existing utility’s facilities or existing utilities’ facilities under the jurisdiction of the commission. The rules and regulations shall be developed consistent with existing rules and regulations pursuant to the authority granted to the commission in Sections 701 and 1701. The expedited procedures shall not prevent or otherwise interfere with a utility’s ability promptly to restore service to its customers requiring the service, and to recover the reasonable costs associated with the restoration of service, as determined by the commission. The expedited procedures shall be adopted by the commission on or before January 1, 1994.
In developing the expedited procedures, the commission shall consider, among other things, the following:
Once the President declares that an emergency exists, the extent to which the expedited procedures should become effective.
The extent to which the expedited procedures should take precedence over any conflicting rule, regulation, or order which may impede any appropriate or necessary decisions and actions by the commission.
If the expedited procedures become effective, the scope of relief which may be sought and granted pursuant thereto, including, but not limited to, the following:
A determination of the applicability of existing commission rules, regulations, and orders.
An exemption from those existing rules and regulations.
The time period following the date of the declaration of an emergency by the President, within which any affected city or county within the declared disaster area or public utility serving all or a portion of the county or city thereof, may apply to the commission for relief.
The need, if any, for referral of any application to an administrative law judge, and the need, if any, for formal evidentiary hearings.
No utility shall be required to proceed to incur any costs pursuant to commission order issued under these expedited procedures until arrangements satisfactory to the affected utility have been made for payment of the excess, if any, of the estimated costs of completing the work contemplated by the commission order over the amount of the costs allocated to the ratepayers by the commission order.
The expedited procedures shall preserve the right of interested parties to reasonable notice and an opportunity to be heard, as required by applicable law. The expedited procedures shall provide that in the event of an emergency as defined in this section, the commission has the authority to waive the referral of the application to an administrative law judge, and has the authority to act on the application.
In the event that the President has declared that an emergency exists, pursuant to federal law, after January 1, 1993, and before the adoption of emergency procedures by the commission, the commission is authorized, and empowered to act expeditiously upon the direct request of any affected city or county or public utility serving all or a portion of the city or county, for relief; and to adopt expedited measures and procedures which the commission determines to be necessary or appropriate, including, but not limited to, the considerations set forth above in subdivision (c).
By January 1, 2020, the commission shall establish the Wildfire Safety Division within the commission, located in Sacramento, California. The Wildfire Safety Division shall do all of the following:
Oversee and enforce electrical corporations’ compliance with wildfire safety pursuant to Chapter 6 (commencing with Section 8385) of Division 4.1.
In consultation with the California Wildfire Safety Advisory Board, develop and recommend to the commission performance metrics to achieve maximum feasible risk reduction to be used to develop the wildfire mitigation plan and evaluate an electrical corporation’s compliance with that plan. For this purpose, “maximum feasible” means capable of being accomplished in a successful manner within a reasonable period of time, taking into account economic, environmental, legal, social, and technological factors.
Develop a field audit program for wildfire mitigation plan compliance by each electrical corporation.
Consult with the Office of Emergency Services in the office’s management and response to utility public safety power shutoff events and utility actions for compliance with public safety power shutoff program rules and regulations.
Support efforts to assess and analyze fire weather data and other atmospheric conditions that could lead to catastrophic wildfires and to reduce the likelihood and severity of wildfire incidents that could endanger the safety of persons, properties, and the environment within the state.
Retain appropriate staff that includes experts in wildfire, weather, climate change, emergency response, and other relevant subject matters.
Review, as necessary, in coordination with the California Wildfire Safety Advisory Board and necessary commission staff, safety requirements for electrical transmission and distribution infrastructure and infrastructure and equipment attached to that electrical infrastructure, and provide recommendations to the commission to address the dynamic risk of climate change and to mitigate wildfire risk.
Effective July 1, 2021, all functions of the Wildfire Safety Division shall be transferred to the Office of Energy Infrastructure Safety established pursuant to Section 15473 of the Government Code.
There is hereby established the California Wildfire Safety Advisory Board. The board shall advise the Office of Energy Infrastructure Safety established pursuant to Section 15473 of the Government Code.
The board shall consist of seven members. Five members shall be appointed by the Governor, one member shall be appointed by the Speaker of the Assembly, and one member shall be appointed by the Senate Committee on Rules. The members of the board shall serve four-year staggered terms. The initial members of the board shall be appointed by January 1, 2020. The Governor shall designate three of the initial members who shall serve two-year terms. Members of the board shall be selected from industry experts, academics, and persons with labor and workforce safety experience or other relevant qualifications and shall represent a cross-section of relevant expertise including, at all times, at least three members experienced in the safe operation, design, and engineering of electrical infrastructure.
The board shall meet at least quarterly and alternate meeting locations between northern, central, and southern California, when feasible.
Members of the board who are not salaried state service employees shall be eligible for reasonable compensation, not to exceed a per diem of four hundred dollars ($400), for attendance at board meetings.
All reasonable costs incurred by the board, including staffing, travel at state travel reimbursement rates, and administrative costs, shall be reimbursed through the Public Utilities Commission Utilities Reimbursement Account provided for in Section 402 and shall be part of the budget of the Office of Energy Infrastructure Safety. The office shall consult with the board in the preparation of this portion of the office’s proposed annual budget.
Communications by the board, its staff, and individual members of the board are not subject to the commission’s ex parte rules set forth in Article 1 (commencing with Section 1701) of Chapter 9.
The California Wildfire Safety Advisory Board shall do both of the following:
Review and provide comments and advisory opinions to local publicly owned electric utilities and electrical cooperatives regarding the content and sufficiency of their wildfire mitigation plans and recommendations on how to mitigate wildfire risk.
Provide other advice and recommendations related to wildfire safety as requested by the Office of Energy Infrastructure Safety.
The electrical corporations and gas corporations that participate in the California Alternate Rates for Energy (CARE) program, as established pursuant to Section 739.1, shall administer low-income energy efficiency and rate assistance programs described in Sections 382, 739.1, 739.2, and 2790, subject to commission oversight. In administering the programs described in Section 2790, the electrical corporations and gas corporations, to the extent practicable, shall do all of the following:
Continue to leverage funds collected to fund the program described in subdivision (a) with funds available from state and federal sources.
Work with state and local agencies, community-based organizations, and other entities to ensure efficient and effective delivery of programs.
Encourage local employment and job skill development.
Maximize the participation of eligible participants.
Work to reduce consumers electric and gas consumption, and bills.
For electrical corporations, target energy efficiency and solar programs to upper-tier and multifamily customers in a manner that will result in long-term permanent reductions in electricity usage at the dwelling units, and develop programs that specifically target nonprofit affordable housing providers, including programs that promote weatherization of existing dwelling units and replacement of inefficient appliances.
For electrical corporations and for public utilities that are both electrical corporations and gas corporations, allocate the costs of the CARE program on an equal cents per kilowatthour or equal cents per therm basis to all classes of customers that were subject to the surcharge that funded the program on January 1, 2008.
If the commission requires low-income energy efficiency programs to be subject to competitive bidding, the electrical and gas corporations described in subdivision (a), as part of their bid evaluation criteria, shall consider both cost-of-service criteria and quality-of-service criteria. The bidding criteria, at a minimum, shall recognize all of the following factors:
The bidder’s experience in delivering programs and services, including, but not limited to, weatherization, appliance repair and maintenance, energy education, outreach and enrollment services, and bill payment assistance programs to targeted communities.
The bidder’s knowledge of the targeted communities.
The bidder’s ability to reach targeted communities.
The bidder’s ability to utilize and employ people from the local area.
The bidder’s general contractor’s license and evidence of good standing with the Contractors’ State License Board.
The bidder’s performance quality as verified by the funding source.
The bidder’s financial stability.
The bidder’s ability to provide local job training.
Other attributes that benefit local communities.
Notwithstanding subdivision (b), the commission may modify the bid criteria based upon public input from a variety of sources, including representatives from low-income communities and the program administrators identified in subdivision (b), in order to ensure the effective and efficient delivery of high quality low-income energy efficiency programs.
CHAPTER 2.2. Natural Gas Restructuring [328. - 328.2.]
The Legislature finds and declares both of the following:
In order to ensure that all core customers of a gas corporation continue to receive safe basic gas service in a competitive market, each existing gas corporation should continue to provide this essential service.
No customer should have to pay separate fees for utilizing services that protect public or customer safety.
As used in this chapter, the following terms have the following meanings:
“Basic gas service” includes transmission, storage for reliability of service, and distribution of natural gas, purchasing natural gas on behalf of a customer, revenue cycle services, and after-meter services.
“Revenue cycle services” means metering services, billing the customer, collection, and related customer services.
“After-meter services” includes, but is not limited to, leak investigation, inspecting customer piping and appliances, carbon monoxide investigation, pilot relighting, and high bill investigation.
“Metering services” includes, but is not limited to, gas meter installation, meter maintenance, meter testing, collecting and processing consumption data, and all related services associated with the meter.
The commission shall require each gas corporation to provide bundled basic gas service to all core customers in its service territory unless the customer chooses or contracts to have natural gas purchased and supplied by another entity. A public utility gas corporation shall continue to be the exclusive provider of revenue cycle services to all customers in its service territory, except that an entity purchasing and supplying natural gas under the commission’s existing core aggregation program may perform billing and collection services for its customers under the same terms as currently authorized by the commission, and except that a supplier of natural gas to noncore customers may perform billing and collection for natural gas supply for its customers. The gas corporation shall continue to calculate its charges for services provided by that corporation. If the commission establishes credits to be provided by the gas corporation to core aggregation or noncore customers who obtain billing or collection services from entities other than the gas corporation, the credit shall be equal to the billing and collection services costs actually avoided by the gas corporation. The commission shall require the distribution rate to continue to include after-meter services.
CHAPTER 2.3. Electrical Restructuring [330. - 400.3.]
ARTICLE 1. General Provisions and Definitions [330. - 332.2.]
In order to provide guidance in carrying out this chapter, the Legislature finds and declares all of the following:
It is the intent of the Legislature that a cumulative rate reduction of at least 20 percent be achieved not later than April 1, 2002, for residential and small commercial customers, from the rates in effect on June 10, 1996. In determining that the April 1, 2002, rate reduction has been met, the commission shall exclude the costs of the competitively procured electricity and the costs associated with the rate reduction bonds, as defined in Section 840.
The people, businesses, and institutions of California spend nearly twenty-three billion dollars ($23,000,000,000) annually on electricity, so that reductions in the price of electricity would significantly benefit the economy of the state and its residents.
The Public Utilities Commission has opened rulemaking and investigation proceedings with regard to restructuring California’s electric power industry and reforming utility regulation.
The commission has found, after an extensive public review process, that the interests of ratepayers and the state as a whole will be best served by moving from the regulatory framework existing on January 1, 1997, in which retail electricity service is provided principally by electrical corporations subject to an obligation to provide ultimate consumers in exclusive service territories with reliable electric service at regulated rates, to a framework under which competition would be allowed in the supply of electric power and customers would be allowed to have the right to choose their supplier of electric power.
Competition in the electric generation market will encourage innovation, efficiency, and better service from all market participants, and will permit the reduction of costly regulatory oversight.
The delivery of electricity over transmission and distribution systems is currently regulated, and will continue to be regulated to ensure system safety, reliability, environmental protection, and fair access for all market participants.
Reliable electric service is of utmost importance to the safety, health, and welfare of the state’s citizenry and economy. It is the intent of the Legislature that electric industry restructuring should enhance the reliability of the interconnected regional transmission systems, and provide strong coordination and enforceable protocols for all users of the power grid.
It is important that sufficient supplies of electric generation will be available to maintain the reliable service to the citizens and businesses of the state.
Reliable electric service depends on conscientious inspection and maintenance of transmission and distribution systems. To continue and enhance the reliability of the delivery of electricity, the Independent System Operator and the commission, respectively, should set inspection, maintenance, repair, and replacement standards.
It is the intent of the Legislature that California enter into a compact with western region states. That compact should require the publicly and investor-owned utilities located in those states, that sell energy to California retail customers, to adhere to enforceable standards and protocols to protect the reliability of the interconnected regional transmission and distribution systems.
In order to achieve meaningful wholesale and retail competition in the electric generation market, it is essential to do all of the following:
Separate monopoly utility transmission functions from competitive generation functions, through development of independent, third-party control of transmission access and pricing.
Permit all customers to choose from among competing suppliers of electric power.
Provide customers and suppliers with open, nondiscriminatory, and comparable access to transmission and distribution services.
The commission has properly concluded that:
These new market institutions should commence simultaneously with the phase in of customer choice, and the public will be best served if these institutions and the nonbypassable transition cost recovery mechanism referred to in subdivisions (s) to (w), inclusive, are in place simultaneously and no later than January 1, 1998.
It is the intention of the Legislature that California’s publicly owned electric utilities and investor-owned electric utilities should commit control of their transmission facilities to the Independent System Operator. These utilities should jointly advocate to the Federal Energy Regulatory Commission a pricing methodology for the Independent System Operator that results in an equitable return on capital investment in transmission facilities for all Independent System Operator participants.
Opportunities to acquire electric power in the competitive market must be available to California consumers as soon as practicable, but no later than January 1, 1998, so that all customers can share in the benefits of competition.
Under the existing regulatory framework, California’s electrical corporations were granted franchise rights to provide electricity to consumers in their service territories.
Consistent with federal and state policies, California electrical corporations invested in power plants and entered into contractual obligations in order to provide reliable electrical service on a nondiscriminatory basis to all consumers within their service territories who requested service.
The cost of these investments and contractual obligations are currently being recovered in electricity rates charged by electrical corporations to their consumers.
Transmission and distribution of electric power remain essential services imbued with the public interest that are provided over facilities owned and maintained by the state’s electrical corporations.
It is proper to allow electrical corporations an opportunity to continue to recover, over a reasonable transition period, those costs and categories of costs for generation-related assets and obligations, including costs associated with any subsequent renegotiation or buyout of existing generation-related contracts, that the commission, prior to December 20, 1995, had authorized for collection in rates and that may not be recoverable in market prices in a competitive generation market, and appropriate additions incurred after December 20, 1995, for capital additions to generating facilities existing as of December 20, 1995, that the commission determines are reasonable and should be recovered, provided that the costs are necessary to maintain those facilities through December 31, 2001. In determining the costs to be recovered, it is appropriate to net the negative value of above market assets against the positive value of below market assets.
The transition to a competitive generation market should be orderly, protect electric system reliability, provide the investors in these electrical corporations with a fair opportunity to fully recover the costs associated with commission approved generation-related assets and obligations, and be completed as expeditiously as possible.
The transition to expanded customer choice, competitive markets, and performance based ratemaking as described in Decision 95-12-063, as modified by Decision 96-01-009, of the Public Utilities Commission, can produce hardships for employees who have dedicated their working lives to utility employment. It is preferable that any necessary reductions in the utility workforce directly caused by electrical restructuring, be accomplished through offers of voluntary severance, retraining, early retirement, outplacement, and related benefits. Whether workforce reductions are voluntary or involuntary, reasonable costs associated with these sorts of benefits should be included in the competition transition charge.
Charges associated with the transition should be collected over a specific period of time on a nonbypassable basis and in a manner that does not result in an increase in rates to customers of electrical corporations. In order to insulate the policy of nonbypassability against incursions, if exemptions from the competition transition charge are granted, a firewall shall be created that segregates recovery of the cost of exemptions as follows:
The cost of the competition transition charge exemptions granted to members of the combined class of residential and small commercial customers shall be recovered only from those customers.
The cost of the competition transition charge exemptions granted to members of the combined class of customers other than residential and small commercial customers shall be recovered only from those customers. The commission shall retain existing cost allocation authority provided that the firewall and rate freeze principles are not violated.
It is the intent of the Legislature to require and enable electrical corporations to monetize a portion of the competition transition charge for residential and small commercial consumers so that these customers will receive rate reductions of no less than 10 percent for 1998 continuing through 2002. Electrical corporations shall, by June 1, 1997, or earlier, secure the means to finance the competition transition charge by applying concurrently for financing orders from the Public Utilities Commission and for rate reduction bonds from the California Infrastructure and Economic Development Bank.
California’s public utility electrical corporations provide substantial benefits to all Californians, including employment and support of the state’s economy. Restructuring the electric services industry pursuant to the act that added this chapter will continue these benefits, and will also offer meaningful and immediate rate reductions for residential and small commercial customers, and facilitate competition in the supply of electric power.
The definitions set forth in this section shall govern the construction of this chapter.
“Aggregator” means any marketer, broker, public agency, city, county, or special district, that combines the loads of multiple end-use customers in facilitating the sale and purchase of electric energy, transmission, and other services on behalf of these customers.
“Broker” means an entity that arranges the sale and purchase of electric energy, transmission, and other services between buyers and sellers, but does not take title to any of the power sold.
“Direct transaction” means a contract between any one or more electric generators, marketers, or brokers of electric power and one or more retail customers providing for the purchase and sale of electric power or any ancillary services.
“Fire wall” means the line of demarcation separating residential and small commercial customers from all other customers as described in subdivision (e) of Section 367.
“Marketer” means any entity that buys electric energy, transmission, and other services from traditional utilities and other suppliers, and then resells those services at wholesale or to an end-use customer.
“Microcogeneration facility” means a cogeneration facility of less than one megawatt.
“Restructuring trusts” means the two tax-exempt public benefit trusts established by Decision 96-08-038 of the Public Utilities Commission to provide for design and development of the hardware and software systems for the Power Exchange and the Independent System Operator, respectively, and that may undertake other activities, as needed, as ordered by the commission.
“Small commercial customer” means a customer that has a maximum peak demand of less than 20 kilowatts.
For purposes of this chapter, “community choice aggregator” means any of the following entities, if that entity is not within the jurisdiction of a local publicly owned electric utility that provided electrical service as of January 1, 2003:
Any city, county, or city and county whose governing board elects to combine the loads of its residents, businesses, and municipal facilities in a communitywide electricity buyers’ program.
Any group of cities, counties, or cities and counties whose governing boards have elected to combine the loads of their programs, through the formation of a joint powers agency established under Chapter 5 (commencing with Section 6500) of Division 7 of Title 1 of the Government Code.
The Kings River Conservation District, the Sonoma County Water Agency, and any California public agency possessing statutory authority to generate and deliver electricity at retail within its designated jurisdiction, provided the entity may only combine the loads of residences, businesses, and governmental facilities of cities and counties within, or contiguous to, its jurisdiction that have, by resolution exercised pursuant to paragraph (12) of subdivision (c) of Section 366.2, requested the agency to implement a community choice aggregation program.
It is the intent of the Legislature to enact Item 1 (revised) on the commission’s August 21, 2000 agenda, entitled “Opinion Modifying Decision (D.) D.00-06-034 and D.00-08-021 to Regarding Interim Rate Caps for San Diego Gas and Electric Company,” as modified below.
It is also the intent of the Legislature that to the extent that the Federal Energy Regulatory Commission orders refunds to electrical corporations pursuant to their findings, the commission shall ensure that any refunds are returned to customers.
The commission shall establish a ceiling of six and five-tenths cents ($0.065) per kilowatthour on the energy component of electric bills for electricity supplied to residential, small commercial, and street lighting customers by the San Diego Gas and Electric Company, through December 31, 2002, retroactive to June 1, 2000. If the commission finds it in the public interest, this ceiling may be extended through December 2003 and may be adjusted as provided in subdivision (d).
The commission shall establish an accounting procedure to track and recover reasonable and prudent costs of providing electric energy to retail customers unrecovered through retail bills due to the application of the ceiling provided for in subdivision (b). The accounting procedure shall utilize revenues associated with sales of energy from utility-owned or managed generation assets to offset an undercollection, if undercollection occurs. The accounting procedure shall be reviewed periodically by the commission, but not less frequently than semiannually. The commission may utilize an existing proceeding to perform the review. The accounting procedure and review shall provide a reasonable opportunity for San Diego Gas and Electric Company to recover its reasonable and prudent costs of service over a reasonable period of time.
If the commission determines that it is in the public interest to do so, the commission, after the date of the completion of the proceeding described in subdivision (g), may adjust the ceiling from the level specified in subdivision (b), and may adjust the frozen rate from the levels specified in subdivision (f), consistent with the Legislature’s intent to provide substantial protections for customers of the San Diego Gas and Electric Company and their interest in just and reasonable rates and adequate service.
For purposes of this section, “small commercial customer” includes, but is not limited to, all San Diego Gas and Electric Company accounts on Rate Schedule A of the San Diego Gas and Electric Company, all accounts of customers who are “general acute care hospitals,” as defined in Section 1250 of the Health and Safety Code, all San Diego Gas and Electric Company accounts of customers who are public or private schools for pupils in kindergarten or any of grades 1 to 12, inclusive, and all accounts on Rate Schedule AL-TOU under 100 kilowatts.
The commission shall establish an initial frozen rate of six and five-tenths cents ($0.065) per kilowatthour on the energy component of electric bills for electricity supplied to all customers by the San Diego Gas and Electric Company not subject to subdivision (b), for the time period ending with the end of the rate freeze for the Pacific Gas and Electric Company and the Southern California Edison Company pursuant to Section 368, retroactive to February 7, 2001. The commission shall consider the comparable energy components of rates for comparable customer classes served by the Pacific Gas and Electric Company and the Southern California Edison Company and, if it determines it to be in the public interest, the commission may adjust this frozen rate, and may do so, retroactive to the date that rate increases took effect for customers of Pacific Gas and Electric Company and Southern California Edison Company pursuant to the commission’s March 27, 2001, decision. The commission shall determine the Fixed Department of Water Resources Set-Aside pursuant to Section 360.5 for customers subject to this section, reflecting a retail rate consistent with the rate for the energy component of electric bills as determined in this subdivision, in place of the retail rate in effect on January 5, 2001. This section shall be construed to modify the payment provisions, but may not be construed to modify the electric procurement obligations of the Department of Water Resources, pursuant to any contract or agreement in accordance with Division 27 (commencing with Section 80000) of the Water Code, and in effect as of February 7, 2001, between the Department of Water Resources and San Diego Gas and Electric Company.
The commission shall institute a proceeding to examine the prudence and reasonableness of the San Diego Gas and Electric Company in the procurement of wholesale energy on behalf of its customers, for a period beginning, at the latest, on June 1, 2000. If the commission finds that San Diego Gas and Electric Company acted imprudently or unreasonably, the commission shall issue orders that it determines to be appropriate affecting the retail rates of San Diego Gas and Electric Company customers including, but not limited to, refunds.
Nothing in this section may be construed to limit the authority of the Department of Water Resources pursuant to Division 27 (commencing with Section 80000) of the Water Code.
Rates set by the commission that are subject to subdivision (f) of Section 332.1 may not result in any retroactive recovery of undercollections by the San Diego Gas and Electric Company. Any undercollection resulting from the retroactive rate reductions ordered pursuant to this chapter, retroactive to February 7, 2001, may not result in a revenue undercollection to San Diego Gas and Electric Company.
ARTICLE 2. Oversight Board [334. - 343.]
The Legislature finds and declares that in order to ensure the success of electric industry restructuring, in the transition to a new market structure it is important to ensure a reliable supply of electricity. Reliable electric service is of paramount importance to the safety, health, and comfort of the people of California. Transmission connections between electric utilities allow them to share generation resources and reduce the number of powerplants necessary to maintain a reliable system. The connections between utilities also create exposure to events that can cause widespread and extended transmission and service outages that reach far beyond the originating utility service area. California utilities and those in the western United States voluntarily adhere to reliability standards developed by the Western Electricity Coordinating Council. The economic cost of extended electricity outages, such as those that occurred in California and throughout the Western Electricity Coordinating Council on July 2, 1996, and August 10, 1996, to California’s residential, commercial, agricultural, and industrial customers is significant. The proposed restructuring of the electricity industry would transfer responsibility for ensuring short- and long-term reliability away from electric utilities and regulatory bodies to the Independent System Operator and various market-based mechanisms. The Legislature has an interest in ensuring that the change in the locus of responsibility for reliability does not expose California citizens to undue economic risk in connection with system reliability.
In order to ensure that the interests of the people of California are served, a five-member Electricity Oversight Board is hereby created as provided in Section 336. For purposes of this chapter, any reference to the Oversight Board shall mean the Electricity Oversight Board. Its functions shall be all of the following:
To oversee the Independent System Operator and the Power Exchange.
To determine the composition and terms of service and to exercise the exclusive right to decline to confirm the appointments of specific members of the governing board of the Power Exchange.
To serve as an appeal board for majority decisions of the Independent System Operator governing board, as they relate to matters subject to exclusive state jurisdiction, as specified in Section 339.
Those members of the Power Exchange governing board whose appointments the Oversight Board has the exclusive right to decline to confirm include proposed governing board members representing agricultural end users, industrial end users, commercial end users, residential end users, end users at large, nonmarket participants, and public interest groups.
To investigate any matter related to the wholesale market for electricity to ensure that the interests of California’s citizens and consumers are served, protected, and represented in relation to the availability of electric transmission and generation and related costs, during periods of peak demand.
The five-member Oversight Board shall be comprised as follows:
Three members, who are California residents and electricity ratepayers, appointed by the Governor from a list jointly provided by the Energy Commission and the Public Utilities Commission, and subject to confirmation by the Senate.
One member of the Assembly appointed by the Speaker of the Assembly.
One member of the Senate appointed by the Senate Committee on Rules.
Legislative members shall be nonvoting members, however, they are otherwise full members of the board with all rights and privileges pertaining thereto.
Oversight Board members shall serve three-year terms with no limit on reappointment. For purposes of the initial appointments set forth in paragraph (1), the Governor shall appoint one member to a one-year term, one to a two-year term, and one to a three-year term.
The Governor shall designate one of the voting members as the chairperson of the Oversight Board who shall preside over meetings and direct the executive director in the routine administration of the Oversight Board’s business. The chairperson may designate one of the other voting members to preside over meetings in the absence of the chairperson.
Two voting members shall constitute a quorum. Any decision or action of the Oversight Board shall be by majority vote of the voting members.
The members of the Oversight Board shall serve without compensation, but shall be reimbursed for all necessary expenses incurred in the performance of their duties.
The Independent System Operator governing board shall comprise a five-member independent governing board of directors appointed by the Governor and subject to confirmation by the Senate. Any reference in this chapter or in any other provision of law to the Independent System Operator governing board means the independent governing board appointed under this subdivision.
A member of the independent governing board appointed under subdivision (a) may not be affiliated with any actual or potential participant in any market administered by the Independent System Operator.
All appointments shall be for three-year terms.
There is no limit on the number of terms that may be served by any member.
The Oversight Board shall require the articles of incorporation and bylaws of the Independent System Operator to be revised in accordance with this section, and shall make filings with the Federal Energy Regulatory Commission as the Oversight Board determines to be necessary.
For purposes of the initial appointments to the Independent System Operator governing board, as provided in subdivision (a), the Governor shall appoint one member to a one-year term, two members to a two-year term, and two members to a three-year term.
The Oversight Board shall have the exclusive right to approve procedures and the qualifications for Power Exchange governing board members specified in subdivision (d) of Section 335, all of whom shall be required to be electricity customers in the area served by the Power Exchange. The Power Exchange governing board shall include, but not be limited to, representatives of investor-owned electric distribution companies, publicly owned electric distribution companies, nonutility generators, public buyers and sellers, private buyers and sellers, industrial end-users, commercial end-users, residential end-users, agricultural end-users, public interest groups, and nonmarket participant representatives. The structural composition of the Power Exchange governing board existing on July 1, 1999, shall remain in effect until an agreement with a participating state is legally in effect. However, prior to such an agreement, California shall retain the right to change the Power Exchange governing board into a nonstakeholder board. In the event of such a legislative change, revised bylaws shall be filed with the Federal Energy Regulatory Commission under Section 205 of the Federal Power Act (16 U.S.C.A. Sec. 824d).
The Oversight Board is the appeal board for majority decisions of the Independent System Operator governing board relating to matters that are identified in subdivision (b) as they pertain to the Independent System Operator.
The following matters are subject to California’s exclusive jurisdiction:
Matters pertaining to retail electric service or retail sales of electric energy.
Ensuring that the purposes and functions of the Independent System Operator and Power Exchange are consistent with the purposes and functions of California nonprofit public benefit corporations, including duties of care and conflict of interest standards for directors of the corporations.
State functions assigned to the Independent System Operator and Power Exchange under state law.
Open meeting standards and meeting notice requirements.
Appointment of advisory representatives representing state interests.
Public access to corporate records.
The amendment of bylaws relevant to these matters.
Only members of the Independent System Operator governing board may appeal a majority decision of the Independent System Operator related to any of the matters specified in subdivision (b) to the Oversight Board.
The Oversight Board shall take the steps that are necessary to ensure the earliest possible incorporation of the Independent System Operator and the Power Exchange as separately incorporated public benefit, nonprofit corporations under the Corporations Code.
The Oversight Board may do all of the following:
Meet at the times and places it may deem proper.
Accept appropriations, grants, or contributions from any public source, private foundation, or individual.
Sue and be sued.
Contract with state, local, or federal agencies for services or work required by the Oversight Board.
Contract for or employ any services or work required by the Oversight Board that in its opinion cannot satisfactorily be performed by its staff or by other state agencies.
Appoint advisory committees from members of other public agencies and private groups or individuals.
As a body, or on the authorization of the Oversight Board, as a subcommittee composed of one or more members, hold hearings at the times and places it may deem proper.
Issue subpoenas to compel the production of books, records, papers, accounts, reports, and documents and the attendance of witnesses.
Administer oaths.
Adopt or amend rules and regulations to carry out the purposes and provisions of this chapter, and to govern the procedures of the Oversight Board.
Exercise any authority consistent with this chapter delegated to it by a federal agency or authorized to it by federal law.
Make recommendations to the Governor and the Legislature at the time or times the Oversight Board deems necessary.
Participate in proceedings relevant to the purposes of this chapter or to the purposes of Division 4.9 (commencing with Section 9600) or, as part of any coordinated effort by the state, participate in activities to promote the formation of interstate agreements to enhance the reliability and function of the electricity system and the electricity market.
Do any and all other things necessary to carry out the purposes of this chapter.
Regulations adopted within 120 days of the effective date of this section may be adopted as emergency regulations in accordance with Chapter 3.5 (commencing with Section 11340) of the Government Code, and for the purposes of that chapter, including Section 11349.6 of the Government Code, the adoption of the regulations shall be considered by the Office of Administrative Law to be necessary for the immediate preservation of the public peace, health, safety, and general welfare.
The Bagley-Keene Open Meeting Act (Article 9 (commencing with Section 11120) of Chapter 1 of Part 1 of Division 3 of Title 2 of the Government Code) applies to meetings of the Oversight Board. In addition to the allowances of that act, the Oversight Board may hold a closed session to consider the appointment of one or more candidates to the governing board of the Power Exchange, deliberate on matters involving the removal of a member of the governing board of the Power Exchange, or to consider a matter based on information that has received a grant of confidential status pursuant to regulations of the Oversight Board, provided that any action taken on such a matter shall be taken by vote in an open session.
Voting members of the Oversight Board shall be required to file financial disclosure statements with the Fair Political Practices Commission. The appointing authority for voting members shall avoid appointing persons with conflicts of interest.
The Oversight Board shall appoint, and fix the salary of, an executive director who shall have charge of administering the affairs of the Oversight Board, including entering into contracts, subject to the direction and policies of the Oversight Board. Notwithstanding Sections 11042 and 11043 of the Government Code, the Oversight Board shall appoint an attorney who shall advise the Oversight Board and each member and represent the Oversight Board as a party in any state or federal action or proceeding related to the purposes of this chapter or to an action of the Oversight Board and who shall perform generally all the duties of attorney to the Oversight Board. For purposes of this section, the Oversight Board may appoint a person exempt pursuant to subdivision (e) of Section 4 of Article VII of the California Constitution. The executive director shall, in accordance with Article VII of the California Constitution and subject to the approval of the Oversight Board, appoint employees as may be necessary to carry out the Oversight Board’s duties and responsibilities.
The Independent System Operator and Power Exchange bylaws shall contain provisions that identify those matters specified in subdivision (b) of Section 339 as matters within state jurisdiction. The bylaws shall also contain provisions which state that California’s bylaws approval function with respect to the matters specified in subdivision (b) of Section 339 shall not preclude the Federal Energy Regulatory Commission from taking any action necessary to address undue discrimination or other violations of the Federal Power Act (16 U.S.C.A. Sec. 791a et seq.) or to exercise any other commission responsibility under the Federal Power Act. In taking any such action, the Federal Energy Regulatory Commission shall give due respect to California’s jurisdictional interests in the functions of the Independent System Operator and Power Exchange and to attempt to accommodate state interests to the extent those interests are not inconsistent with the Federal Energy Regulatory Commission’s statutory responsibilities. The bylaws shall state that any future agreement regarding the apportionment of the Independent System Operator and Power Exchange board appointment function among participating states associated with the expansion of the Independent System Operator and Power Exchange into multistate entities shall be filed with the Federal Energy Regulatory Commission pursuant to Section 205 of the Federal Power Act (16 U.S.C.A. Sec. 824d).
Any necessary bylaw changes to implement the provisions of Section 335, 337, 338, 339, or subdivision (a) of this section, or changes required pursuant to an agreement as contemplated by subdivision (a) of this section with a participating state for a regional organization, shall be effective upon approval of the respective governing boards and the Oversight Board and acceptance for filing by the Federal Energy Regulatory Commission.
The Attorney General shall represent the Department of Finance and shall succeed to, and may exercise, all rights, claims, powers, and entitlements of the Electricity Oversight Board in any litigation or settlement to obtain ratepayer recovery for the effects of the 2000–02 energy crisis. This section does not require the Attorney General to litigate any claim, or take any other action, as successor to the Electricity Oversight Board.
The Attorney General shall not distribute or expend the proceeds of any settlements of claims described in subdivision (a), except in accordance with Article 9.5 (commencing with Section 16428.1) of Chapter 2 of Part 2 of Division 4 of Title 2 of the Government Code and Division 27 (commencing with Section 80000) of the Water Code.
The Attorney General shall not distribute or expend the proceeds of any settlements of claims allocated to the Electricity Oversight Board.
ARTICLE 3. Independent System Operator [345. - 352.7.]
The Independent System Operator shall ensure the efficient use and reliable operation of the transmission grid consistent with the achievement of planning and operating reserve criteria that are no less stringent than those established by the Western Electricity Coordinating Council and the North American Electric Reliability Council.
In furtherance of subdivision (a), the Independent System Operator may amend its tariff, as deemed necessary and subject to approval by the Federal Energy Regulatory Commission through its rulemaking process, to be consistent with subdivision (a).
The chair of the board of governors and the chief executive officer of the Independent System Operator shall appear annually before the appropriate policy committees of the Assembly and Senate to present the report required pursuant to Section 345.2.
The Independent System Operator shall develop, publish, and annually update a report that includes all of the following information:
Any changes to its federal tariff sought, and those changes approved, by the Federal Energy Regulatory Commission.
The status of policy initiatives and recurring processes considered by the Independent System Operator during the prior year.
Actions undertaken by the Independent System Operator governing board and, if applicable, the governing board of an independent regional organization whose electricity market California entities participate in.
An assessment of market activity during the prior year by any independent market monitor and, if applicable, independent market analysis maintained by an independent regional organization used by the Independent System Operator.
Actions undertaken within the transmission planning process of the Independent System Operator and the implementation of projects approved in that process.
If the Independent System Operator uses a voluntary energy market governed by an independent regional organization, that organization shall provide the Independent System Operator with the information required for the report required by this section, as applicable.
The Independent System Operator shall submit the report required pursuant to subdivision (a) to the Governor and the Legislature, in compliance with Section 9795 of the Government Code, no later than February 1 of each year.
The Independent System Operator shall post the report in a conspicuous area of its internet website and shall have a program to disseminate the information in the report using computer mailing lists to provide regular updates on the information to those members of the public and organizations that request that information.
The Independent System Operator, as a nonprofit, public benefit corporation, shall conduct its operations consistent with applicable state and federal laws and consistent with the interests of the people of the state.
To ensure the reliability of electric service and the health and safety of the public, the Independent System Operator shall manage the transmission grid and related energy markets in a manner that is consistent with all of the following:
Making the most efficient use of available energy resources. For purposes of this section, “available energy resources” include energy, capacity, ancillary services, and demand bid into markets administered by the Independent System Operator. “Available energy resources” do not include a schedule submitted to the Independent System Operator by an electrical corporation or a local publicly owned electric utility to meet its own customer load.
Reducing, to the extent possible, overall economic cost to the state’s consumers.
Applicable state law intended to protect the public’s health and the environment.
Maximizing availability of existing electric generation resources necessary to meet the needs of the state’s electricity consumers.
Conducting internal operations in a manner that minimizes cost impact on ratepayers to the extent practicable and consistent with the provisions of this chapter.
Communicating with all balancing area authorities in California in a manner that supports electrical reliability.
The Independent System Operator shall do all of the following:
Notwithstanding the requirements related to energy markets in subdivision (b) of Section 345.5, the Independent System Operator and the electrical corporations that are participating transmission owners whose transmission systems are operated by the Independent System Operator may use voluntary energy markets governed by an independent regional organization only if all of the following requirements are satisfied:
The independent regional organization is a nonprofit corporation whose governance documents, and the tariff approved by the Federal Energy Regulatory Commission, include a requirement to respect the authority of each state that has a load-serving entity or balancing authority participating in the market to set its own procurement, resource adequacy, environmental, reliability, and other public interest policies and exercise oversight over its regulated entities.
The governing board of the independent regional organization maintains a public policy committee consisting of members of the governing board of the independent regional organization that engages with states, local power authorities, and federal power marketing administrations about potential impacts to state, local, or federal policies before it approves a tariff change for filing at the Federal Energy Regulatory Commission.
The governing board of the independent regional organization maintains a relationship with and seeks input from a body of state regulators or similar body to receive the views of state regulators.
The independent regional organization makes funding available for a consumer advocate organization that represents the interests of one or more consumer advocate offices authorized in state law, including the Public Advocate’s Office of the Public Utilities Commission, and facilitates engagement by those offices with the independent regional organization.
The independent regional organization maintains an office of public participation to provide information and education to members of the public about issues and initiatives at the independent regional organization, including facilitating engagement in those processes.
In addition to any independent market monitoring activity required by a Federal Energy Regulatory Commission order, the independent regional organization maintains access to independent market analysis for the governing board of the independent regional organization on the impacts of market dynamics or rule changes to minimize overall costs to end-use consumers.
Subject to reasonable confidentiality provisions, market data is available to the commission and the Public Advocate’s Office of the Public Utilities Commission, and other states’ commissions and public advocate offices, to the same or greater extent as existed on December 31, 2024, for the markets governed by the Independent System Operator.
There is a stakeholder process designed to provide nonbinding advice to the governing board of the independent regional organization.
The independent regional organization is obligated to conduct meetings and make decisions in an open process with transparent, documented rationales, and all meetings of the governing board of the independent regional organization are publicly noticed and, excluding executive sessions, are available to remote participants, recorded and posted on the independent regional organization’s internet website, open to the public, and subject to open record requirements. The obligations in this paragraph shall be substantially similar to those that apply to the Independent System Operator at the time a resolution is adopted pursuant to subdivision (b).
The Independent System Operator continues to operate the energy markets, subject to the market rules determined by the independent regional organization as accepted by the Federal Energy Regulatory Commission.
The market rules of the independent regional organization provide greenhouse gas emissions information and protocols sufficient to enable compliance with the requirements of any state agency.
All independent regional organization services are offered on a voluntary basis with each participant retaining its decisionmaking autonomy regarding the extent of its participation.
The tariff approved by the Federal Energy Regulatory Commission for the independent regional organization provides a procedure for unilateral withdrawal from the independent regional organization’s energy markets by any participant on their own accord, or as required by an applicable regulatory authority or state statute, with reasonable prior notice and without any penalties, unreasonable costs, or further discretionary approvals.
On or after January 1, 2028, the Independent System Operator may implement tariff modifications accepted by the Federal Energy Regulatory Commission to operate the energy markets whose rules are governed by an independent regional organization, as provided in subdivision (a), if the governing board of the Independent System Operator has adopted a resolution finding that each of the requirements of paragraphs (1) to (13), inclusive, of subdivision (a) have been or will be adopted by the independent regional organization. The governing board of the Independent System Operator may adopt the resolution if the Independent System Operator satisfies all of the following requirements before adopting the resolution:
The meeting is open to the public, available to remote participants, recorded, and posted on the Independent System Operator’s internet website.
The Independent System Operator issues a notice of the meeting and proposed findings not less than 90 days before the meeting.
The notice explains the basis for finding that each requirement of paragraphs (1) to (13), inclusive, of subdivision (a) will be met.
The notice provides an opportunity for written comments on the proposed findings.
The Independent System Operator issues written responses to any comments not less than 20 days before the meeting.
After issuing the written responses described in paragraph (5), but before adopting the resolution, the Independent System Operator shall offer to provide testimony to the legislative committee in each house of the Legislature with primary jurisdiction over electrical corporations on its proposed findings and responses and shall provide testimony to hearings of those committees if those committees request testimony.
The Independent System Operator receives and accepts written comments from the commission, Public Advocate’s Office, and Energy Commission provided pursuant to paragraph (4) regarding the proposed findings.
The commission shall make a determination through a formal decision in an existing or new proceeding that the requirements in subdivisions (a) and (b) have been satisfied before electrical corporations participate in an energy market governed by an independent regional organization.
This section does not diminish the commission’s authority to direct an electrical corporation to withdraw from an energy market governed by an independent regional organization. The commission may direct an electrical corporation to withdraw from an energy market governed by an independent regional organization on its own volition through a proceeding or any other commission process, including if the commission identifies any activities of the independent regional organization that would undermine or jeopardize the commission’s authority regarding resource adequacy, integrated resource planning, or procuring resources under Section 380, 454.51, or 454.52.
The Independent System Operator shall maintain the necessary technical capability to operate energy markets in a manner that enables California electrical corporations, local publicly owned electric utilities, and other applicable market participants to withdraw from the markets governed by the independent regional organization and instead the Independent System Operator would provide separate market services for those entities.
Beginning one year after the implementation of the independent regional organization’s markets, and annually thereafter, the Independent System Operator, in consultation with the independent regional organization, shall report to the commission, Energy Commission, and the legislative committees with primary jurisdiction over electrical corporations, in compliance with Section 9795 of the Government Code, on the status of the development and compliance with this section.
The commission and Energy Commission shall review each report required pursuant to paragraph (2) and shall publicly post an acknowledgment to their internet websites that they have reviewed the contents of each report.
The Independent System Operator shall conduct a study of the impacts of implementing subdivision (a) on the creation or retention of jobs in California. The study shall specifically include the impact on jobs constructing and maintaining powerplants in California.
The Independent System Operator shall host public workshops on the study methodology and the results of the study.
The Independent System Operator shall complete the study on or before December 31, 2026. Upon completion, the Independent System Operator shall provide the study to the legislative committee in each house of the Legislature with primary jurisdiction over electrical corporations.
The results of the study shall be included in the Independent System Operator’s findings and resolution described in subdivision (b).
The study submitted pursuant to paragraph (3) shall be in compliance with Section 9795 of the Government Code.
The Independent System Operator shall continue its functions and responsibilities as a balancing authority as they existed before enactment of this section, and maintain compliance with applicable reliability standards as developed, adopted, and enforced by the North American Electric Reliability Corporation, the Western Electricity Coordinating Council, or the Federal Energy Regulatory Commission.
The Independent System Operator shall not change its balancing authority area from that which existed on December 31, 2024, except as follows:
Standard addition or removal of transmission lines, substations, and other equipment by participating transmission owners or other asset owners.
The Independent System Operator may combine its balancing authority area with another California balancing authority if the combination is mutually agreed upon.
The Independent System Operator may use its subscriber participating transmission owner tariff.
Except as provided in subdivision (a) with respect to managing energy markets as provided in this section, this section does not change the responsibilities of the Independent System Operator under Section 345.5, including managing the transmission grid, planning for transmission expansion, reliability, resource adequacy, and complying with Section 25308 of the Public Resources Code.
This section does not change any requirement related to the California Renewables Portfolio Standard Program as provided in Article 16 (commencing with Section 399.11).
The independent regional organization is not a California balancing authority.
The geographic footprint of the independent regional organization is not a balancing authority area.
This section does not change the policy of the state to reach specified targets by specified dates for supplying eligible renewable energy resources and zero-carbon resources as provided in subdivision (a) of Section 454.53.
This section does not change the authority of the commission over an electrical corporation’s participation in any additional products or services offered by the independent regional organization and the electrical corporations shall not participate in any additional products and services offered by the independent regional organization unless authorized by the commission.
The Independent System Operator may act as a vendor, through a contract with the independent regional organization, of market operation services, generation dispatch services, transmission operation services, transmission planning services, reliability coordination, balancing authority compliance or operation services, or other electrical system services.
This section does not prohibit the independent regional organization from offering additional products or services on a voluntary basis, including, but not limited to, cooptimization of ancillary services, administration of a resource adequacy program, or transmission planning or service.
For purposes of this section, both of the following definitions apply:
“Balancing authority,” “balancing authority area,” and “California balancing authority” have the same meanings as provided in Section 399.12.
“Load-serving entity” has the same meaning as provided in Section 380.
The Independent System Operator shall immediately participate in all relevant Federal Energy Regulatory Commission proceedings. The Independent System Operator shall ensure that additional filings at the Federal Energy Regulatory Commission request confirmation of the relevant provisions of this chapter and seek the authority needed to give the Independent System Operator the ability to secure generating and transmission resources necessary to guarantee achievement of planning and operating reserve criteria no less stringent than those established by the Western Electricity Coordinating Council and the North American Electric Reliability Council.
The Independent System Operator governing board may form appropriate technical advisory committees composed of market and nonmarket participants to advise the Independent System Operator governing board on issues including, but not limited to, rules and protocols and operating procedures.
The Independent System Operator shall adopt inspection, maintenance, repair, and replacement standards for the transmission facilities under its control no later than September 30, 1997. The standards, which shall be performance or prescriptive standards, or both, as appropriate, for each substantial type of transmission equipment or facility, shall provide for high quality, safe, and reliable service. In adopting its standards, the Independent System Operator shall consider: cost, local geography and weather, applicable codes, national electric industry practices, sound engineering judgment, and experience. The Independent System Operator shall also adopt standards for reliability, and safety during periods of emergency and disaster. The Independent System Operator shall report to the Oversight Board, at such times as the Oversight Board may specify, on the development and implementation of the standards in relation to facilities under the operational control of the Independent System Operator. The Independent System Operator shall require each transmission facility owner or operator to report annually on its compliance with the standards. That report shall be made available to the public.
The Independent System Operator shall perform a review following a major outage that affects at least 10 percent of the customers of the entity providing the local distribution service. The review shall address the cause of the major outage, the response time and effectiveness, and whether the transmission facility owner or operator’s operation and maintenance practices enhanced or undermined the ability to restore service efficiently and in a timely manner.
If the Independent System Operator finds pursuant to subdivision (a) that the operation and maintenance practices of the transmission facility owner or operator prolonged the response time or was responsible for the outage, the Independent System Operator may order appropriate sanctions, subject to the Federal Energy Regulatory Commission approving that authority.
If the Independent System Operator finds pursuant to subdivision (a) that the primary cause of the outage was the insufficiency of the electricity supply available to serve the electrical load within its balancing area authority, the Independent System Operator shall post on its internet website the finding and recommendations to prevent future shortfalls and share the finding and recommendations with the commission, the Energy Commission, and the Legislature.
Findings and recommendations submitted to the Legislature shall be provided in accordance with Section 9795 of the Government Code.
Beginning January 15, 2002, and at least once monthly thereafter, the Independent System Operator shall notify each air pollution control district and air quality management district of the name and address of each entity within the district’s boundaries within the Independent System Operator’s control area with whom the Independent System Operator enters into an interruptible service contract or similar arrangement.
For the purposes of this section, “interruptible service contract or similar arrangement” means any arrangement in which a nonresidential entity agrees to reduce or consider reducing its electrical consumption during periods of peak demand or at the request of the Independent System Operator in exchange for compensation, or for assurances not to be blacked out or other similar nonmonetary assurances.
The local air pollution control district or air quality management district shall maintain in a confidential manner the information received pursuant to this section. However, nothing in this subdivision shall affect the applicability of Division 10 (commencing with Section 7920.000) of Title 1 of the Government Code, or of any other similar open records statute or ordinance, to information provided pursuant to this section.
Notwithstanding Section 10231.5 of the Government Code, upon approval by the Independent System Operator of each transmission plan produced through the transmission planning process, or a successor process, the Independent System Operator shall report to the commission and the relevant policy committees of both houses of the Legislature any new use of any grid enhancing technology that is deemed reasonable by the Independent System Operator in that plan and the costs and efficiency savings of the deployment of that grid enhancing technology.
The report submitted to the relevant policy committees of the Legislature pursuant to subdivision (a) shall be submitted in accordance with Section 9795 of the Government Code.
The Independent System Operator shall make publicly available a list of all power plants located in the state that are not operational due to a planned or unplanned outage.
For the purposes of complying with subdivision (a), the Independent System Operator shall make the list available over the Internet.
The Independent System Operator shall update the list established pursuant to subdivision (a) on a daily basis.
It shall be unlawful for a person to intentionally disclose proprietary information obtained in the negotiation, execution, or performance of a consulting services contract, as defined in Section 10335.5 of the Public Contract Code, or an information technology contract, as defined in Section 11702 of the Government Code, with the Independent System Operator when the contracting party knew or should have known that the disclosure was likely to cause harm.
A violation of this section shall be punishable as a misdemeanor and may be prosecuted by the Attorney General or by a local district attorney in the district in which the disclosure took place.
For the purposes of this section “proprietary information” shall include any information agreed by the contracting parties to be proprietary, or any information that is designated by the Independent System Operator to be proprietary. The Independent System Operator shall provide written notification to a contracting party of any information that, subsequent to the execution of the contract, is identified to be proprietary. The Independent System Operator shall make this designation only in cases where the Independent System Operator has reason to believe that the release of this information poses an immediate threat to the health, safety, or welfare of the public or the Independent System Operator has reason to believe that the contracting party intends to sell the information. If the Independent System Operator makes a designation of proprietary information subsequent to the execution of the contract, the Independent System Operator shall make a good faith effort to amend the contract to incorporate the subsequent designation of proprietary information. The Independent System Operator shall specifically identify in the contract any information that is considered to be proprietary. A contracting party is not in violation of this section if that party discloses information prior to the receipt of the written notification.
Any information that is required to be released or disclosed by a contracting party pursuant to a legal requirement, including an order of a court or regulatory agency, shall not be considered a violation of this section.
ARTICLE 3.5. Distributed Energy Resources [353.1. - 353.15.]
As used in this article, “distributed energy resources” means electric generation technology that meets all of the following criteria:
Commences initial operation between May 1, 2001, and June 1, 2003, except that gas-fired distributed energy resources that are not operated in a combined heat and power application shall commence operation no later than September 1, 2002.
Is located within a single facility.
Is five megawatts or smaller in aggregate capacity.
Is powered by any fuel other than diesel.
Complies with emission standards and guidance adopted by the State Air Resources Board pursuant to Sections 41514.9 and 41514.10 of the Health and Safety Code. Prior to the adoption of those standards and guidance, for the purpose of this article, distributed energy resources shall meet emission levels equivalent to nine parts per million oxides of nitrogen, or the equivalent standard taking into account efficiency as determined by the State Air Resources Board, averaged over a three-hour period, or best available control technology for the applicable air district, whichever is lower, except for distributed generation units that displace and therefore significantly reduce emissions from natural gas flares or reinjection compressors, as determined by the State Air Resources Board. These units shall comply with the applicable best available control technology as determined by the air pollution control district or air quality management district in which they are located.
As used in this article, “ultraclean and low-emission distributed generation” means any electric generation technology that meets both of the following criteria:
Commences initial operation between January 1, 2003, and December 31, 2008.
Produces zero emissions during its operation or produces emissions during its operation that are equal to or less than the 2007 State Air Resources Board emission limits for distributed generation, except that technologies operating by combustion must operate in a combined heat and power application with a 60-percent system efficiency on a higher heating value.
In establishing rates and fees, the commission may consider energy efficiency and emissions performance to encourage early compliance with air quality standards established by the State Air Resources Board for ultraclean and low-emission distributed generation.
The commission shall require each electrical corporation under the operational control of the Independent System Operator as of January 1, 2001, to modify its tariffs so that all customers installing new distributed energy resources in accordance with the criteria described in Section 353.1 are served under rates, rules, and requirements identical to those of a customer within the same rate schedule that does not use distributed energy resources, and to withdraw any provisions in otherwise applicable tariffs that activate other tariffs, rates, or rules if a customer uses distributed energy resources.
To qualify for the tariffs described in subdivision (a), each customer with distributed energy resources that meet the criteria of Section 353.1 shall participate in a real-time metering and pricing program, when these programs become available, in which rates for any energy purchased from the electrical corporation reflect the actual cost to the electrical corporation of energy it purchases at the time it is consumed by the customer. Prior to the time these programs become available, the customer shall participate in a time-of-use pricing tariff. On or before December 31, 2001, the commission shall adopt a real time pricing tariff for the purpose of this section.
Each electrical corporation, as part of its distribution planning process, shall consider nonutility owned distributed energy resources as a possible alternative to investments in its distribution system in order to ensure reliable electric service at the lowest possible cost.
Notwithstanding Section 353.3, nothing in this article may result in any exemption from reasonable interconnection charges, lead to any reduction in contributions by each customer class to public purpose programs funded under Section 399.8, or relieve any customer of any obligation determined by the commission to result from participation in the purchase of power through the Department of Water Resources pursuant to Division 27 (commencing with Section 80000) of the Water Code.
In establishing the rates required under this article, the commission shall create a firewall that segregates distribution cost recovery so that any net costs, taking into account the actual costs and benefits of distributed energy resources, proportional to each customer class, as determined by the commission, resulting from the tariff modifications granted to members of each customer class may be recovered only from that class.
A local publicly owned electric utility or a local publicly owned utility otherwise providing electrical service, shall review at the earliest practicable date its rates, tariffs, and rules to identify barriers to and determine the appropriate balance of costs and benefits of distributed energy resources in order to facilitate the installation of these resources in the interests of their customer-owners and the state, and shall hold at least one noticed public meeting to solicit public comment on the review and any recommended changes. However, notwithstanding any other provision of this article, such an entity has the sole authority to undertake such a review and to make modifications to its rates, tariffs, and rules as the governing body of that utility determines to be necessary.
The commission shall require each electrical corporation to establish new tariffs on or before January 1, 2003, for customers using distributed energy resources, including, but not limited to, those that do not meet all of the criteria described in Section 353.1. However, after January 1, 2003, distributed energy resources that meet all of the criteria described in Section 353.1 shall continue to be subject only to those tariffs in existence pursuant to Section 353.3, until June 1, 2011, except that installations that do not operate in a combined heat and power application will be subject to those tariffs in existence pursuant to Section 353.3 only until June 1, 2006. Those tariffs required pursuant to this section shall ensure that all net distribution costs incurred to serve each customer class, taking into account the actual costs and benefits of distributed energy resources, proportional to each customer class, as determined by the commission, are fully recovered only from that class. The commission shall require each electrical corporation, in establishing those rates, to ensure that customers with similar load profiles within a customer class will, to the extent practicable, be subject to the same utility rates, regardless of their use of distributed energy resources to serve onsite loads or over-the-fence transactions allowed under Sections 216 and 218. Customers with dedicated facilities shall remain responsible for their obligations regarding payment for those facilities.
In establishing the tariffs, the commission shall consider coincident peakload, and the reliability of the onsite generation, as determined by the frequency and duration of outages, so that customers with more reliable onsite generation and those that reduce peak demand pay a lower cost-based rate.
In order to evaluate the efficiency, emissions, and reliability of distributed energy resources with a capacity greater than 10 kilowatts, customers that install those resources pursuant to this article shall report to the commission, on an annual basis, all of the following information, as recorded on a monthly basis:
Heat rate for the resource.
Total kilowatthours produced in the peak and off-peak periods, as determined by the ISO.
Emissions data for the resource, as required by the State Air Resources Board or the appropriate air quality management district or air pollution control district.
The commission shall release the information submitted pursuant to subdivision (a) in a manner that does not identify the individual user of the distributed energy resource.
ARTICLE 6. Requirements for the Public Utilities Commission [360. - 380.5.]
The commission shall ensure that existing, and if necessary, additional filings at the Federal Energy Regulatory Commission request confirmation of the relevant provisions of this chapter and seek the authority needed to give the Independent System Operator the ability to secure generating and transmission resources necessary to guarantee achievement of planning and operating reserve criteria no less stringent than those established by the Western Electricity Coordinating Council and the North American Electric Reliability Council.
The commission shall determine that portion of each existing electrical corporation’s retail rate effective on January 5, 2001, that is equal to the difference between the generation related component of the retail rate and the sum of the costs of the utility’s own generation, qualifying facility contracts, existing bilateral contracts, and ancillary services. That portion of the retail rate shall be known as the California Procurement Adjustment. The commission shall further determine the amount of the California Procurement Adjustment that is allocable to the power sold by the department. That amount shall be payable, by each electrical corporation, upon receipt by the electrical corporation of the revenues from its retail end use customers, to the department for deposit in the Department of Water Resources Electric Power Fund, established by Section 80200 of the Water Code. The amount determined pursuant to this subdivision shall be known as the Fixed Department of Water Resources Set-Aside.
The commission shall ensure that any funds secured by the restructuring trusts established for the purposes of developing the Independent System Operator and the Power Exchange shall be placed at the disposal of the Independent System Operator and the Power Exchange respectively.
In proceedings pursuant to Section 455.5, 851, or 854, the commission shall ensure that facilities needed to maintain the reliability of the electric supply remain available and operational, consistent with maintaining open competition and avoiding an overconcentration of market power. In order to determine whether the facility needs to remain available and operational, the commission shall use standards that are no less stringent than the Western Electricity Coordinating Council and North American Electric Reliability Council standards for planning reserve criteria.
The commission shall require that generation facilities located in the state that have been disposed of in proceedings pursuant to Section 851 are operated by the persons or corporations who own or control them in a manner that ensures their availability to maintain the reliability of the electric supply system.
Consistent with Section 851 and the commission’s regulation of transfers of operational control of electrical corporation facilities, an electrical corporation subject to commission Decision 98-01-053 (January 21, 1998), Joint Application of Pacific Gas and Electric Company (U 39-E), San Diego Gas and Electric Company (U 902-E), and Southern California Edison Company (U 388-E) for an Order under Public Utilities Code Section 853 Exempting Them from the Provisions of Section 851 or in the Alternative for Authority to Convey Operational Control of Designated Transmission Lines and Associated Facilities to an Independent System Operator, shall participate in the Independent System Operator.
An electrical corporation shall not withdraw a facility from the operational control of the Independent System Operator without commission approval pursuant to Section 851.
In order to ensure the continued safe and reliable operation of public utility electric generating facilities, the commission shall require in any proceeding under Section 851 involving the sale, but not spinoff, of a public utility electric generating facility, for transactions initiated prior to December 31, 2001, and approved by the commission by December 31, 2002, that the selling utility contract with the purchaser of the facility for the selling utility, an affiliate, or a successor corporation to operate and maintain the facility for at least two years. The commission may require these conditions to be met for transactions initiated on or after January 1, 2002. The commission shall require the contracts to be reasonable for both the seller and the buyer.
Subdivision (a) shall apply only if the facility is actually operated during the two-year period following the sale. Subdivision (a) shall not require the purchaser to operate a facility, nor shall it preclude a purchaser from temporarily closing the facility to make capital improvements.
For those bayside fossil fueled electric generation and associated transmission facilities that an electrical corporation has proposed to divest in a public auction and for which the Legislature has appropriated state funds in the Budget Act of 1998 to assist local governmental entities in acquiring the facilities or to mitigate environmental and community issues, and where the local governmental entity proposes that the closure of the power plant would serve the public interest by mitigating air, water and other environmental, health and safety, and community impacts associated with the facilities, and where the local governmental entity and electrical corporation have engaged in significant negotiations with the purpose of shutting down the power plant, and where there is an agreement between the electrical corporation and the local governmental entity for closure of the facilities or for the local governmental entity to acquire the facilities, the commission shall approve the closure of these facilities or the transfer of these electric generation and associated transmission facilities to the local governmental entity and shall consider the utility transactions with the community to be just and reasonable for its ratepayers. For purposes of calculating the Competition Transition Charge, the commission shall not use any inferred market value for the facilities predicated on the continued use of the plant, the construction of successor facilities or alternative use of the site and shall net the costs of the depreciated book value of the power plant and the unrecovered costs of decommissioning, environmental remediation and site restoration against the net proceeds received from the local governmental entity for the acquisition or closure of the facilities. Thereafter, any net proceeds received from the ultimate disposition, by the electrical corporation, of the site shall be credited to recovery of Competition Transition Charges.
The commission shall adopt inspection, maintenance, repair, and replacement standards, and shall, in a new proceeding, or new phase of an existing proceeding, to commence on or before July 1, 2015, consider adopting rules to address the physical security risks to the distribution systems of electrical corporations. The standards or rules, which shall be prescriptive or performance based, or both, and may be based on risk management, as appropriate, for each substantial type of distribution equipment or facility, shall provide for high-quality, safe, and reliable service.
In setting its standards or rules, the commission shall consider: cost, local geography and weather, applicable codes, potential physical security risks, national electric industry practices, sound engineering judgment, and experience. The commission shall also adopt standards for operation, reliability, and safety during periods of emergency and disaster.
The commission shall conduct a review to determine whether the standards or rules prescribed in this section have been met. If the commission finds that the standards or rules have not been met, the commission may order appropriate sanctions, including penalties in the form of rate reductions or monetary fines. The review shall be performed after every major outage. Any money collected pursuant to this subdivision shall be used to offset funding for the California Alternative Rates for Energy Program.
The commission may, consistent with other provisions of law, withhold from the public information generated or obtained pursuant to this section that it deems would pose a security threat to the public if disclosed.
The actions of the commission pursuant to this chapter shall be consistent with the findings and declarations contained in Section 330. In addition, the commission shall do all of the following:
Facilitate the efforts of the state’s electrical corporations to develop and obtain authorization from the Federal Energy Regulatory Commission for the creation and operation of an Independent System Operator and an independent Power Exchange, for the determination of which transmission and distribution facilities are subject to the exclusive jurisdiction of the commission, and for approval, to the extent necessary, of the cost recovery mechanism established as provided in Sections 367 to 376, inclusive. The commission shall also participate fully in all proceedings before the Federal Energy Regulatory Commission in connection with the Independent System Operator and the independent Power Exchange, and shall encourage the Federal Energy Regulatory Commission to adopt protocols and procedures that strengthen the reliability of the interconnected transmission grid, encourage all publicly owned utilities in California to become full participants, and maximize enforceability of such protocols and procedures by all market participants.
Authorize direct transactions between electricity suppliers and end use customers, subject to implementation of the nonbypassable charge referred to in Sections 367 to 376, inclusive. Direct transactions shall commence simultaneously with the start of an Independent System Operator and Power Exchange referred to in subdivision (a). The simultaneous commencement shall occur as soon as practicable, but no later than January 1, 1998. The commission shall develop a phase-in schedule at the conclusion of which all customers shall have the right to engage in direct transactions. Any phase-in of customer eligibility for direct transactions ordered by the commission shall be equitable to all customer classes and accomplished as soon as practicable, consistent with operational and other technological considerations, and shall be completed for all customers by January 1, 2002.
Customers shall be eligible for direct access irrespective of any direct access phase-in implemented pursuant to this section if at least one-half of that customer’s electrical load is supplied by energy from a renewable resource provider certified pursuant to Section 383, provided however that nothing in this section shall provide for direct access for electric consumers served by municipal utilities unless so authorized by the governing board of that municipal utility.
Except as expressly authorized by this section, and subject to the limitations in subdivisions (b) and (c), the right of retail end-use customers pursuant to this chapter to acquire service from other providers is suspended until the Legislature, by statute, lifts the suspension or otherwise authorizes direct transactions. For purposes of this section, “other provider” means any person, corporation, or other entity that is authorized to provide electric service within the service territory of an electrical corporation pursuant to this chapter, and includes an aggregator, broker, or marketer, as defined in Section 331, and an electric service provider, as defined in Section 218.3. “Other provider” does not include a community choice aggregator, as defined in Section 331.1, and the limitations in this section do not apply to the sale of electricity by “other providers” to a community choice aggregator for resale to community choice aggregation electricity consumers pursuant to Section 366.2.
The commission shall authorize individual retail nonresidential end-use customers to acquire electric service from other providers in each electrical corporation’s distribution service territory, up to a maximum allowable total kilowatthours annual limit. The maximum allowable annual limit shall be established by the commission for each electrical corporation at the maximum total kilowatthours supplied by all other providers to distribution customers of that electrical corporation during any sequential 12-month period between April 1, 1998, and October 11, 2009. Within six months of October 11, 2009, the commission shall adopt and implement a reopening schedule that commences immediately and will phase in the allowable amount of increased kilowatthours over a period of not less than three years, and not more than five years, raising the allowable limit of kilowatthours supplied by other providers in each electrical corporation’s distribution service territory from the number of kilowatthours provided by other providers as of October 11, 2009, to the maximum allowable annual limit for that electrical corporation’s distribution service territory. The commission shall review and, if appropriate, modify its currently effective rules governing direct transactions, but that review shall not delay the start of the phase-in schedule.
Once the commission has authorized additional direct transactions pursuant to subdivision (b), it shall do both of the following:
Ensure that other providers are subject to the same requirements that apply to the state’s three largest electrical corporations under any programs or rules adopted by the commission to implement the resource adequacy provisions of Section 380, the renewables portfolio standard provisions of Article 16 (commencing with Section 399.11), the requirements for the electricity sector adopted by the State Air Resources Board pursuant to the California Global Warming Solutions Act of 2006 (Division 25.5 (commencing with Section 38500) of the Health and Safety Code), and the requirements of the integrated resource planning process as specified in Sections 454.52 to 454.54, inclusive. This requirement applies notwithstanding any prior decision of the commission to the contrary.
Ensure that, in the event that the commission authorizes, in the situation of a contract with a third party, or orders, in the situation of utility-owned generation, an electrical corporation to obtain generation resources that the commission determines are needed to meet system or local area reliability needs for the benefit of all customers in the electrical corporation’s distribution service territory, the net capacity costs of those generation resources are allocated on a fully nonbypassable basis consistent with departing load provisions as determined by the commission, to all of the following:
Bundled service customers of the electrical corporation.
Customers that purchase electricity through a direct transaction with other providers.
Customers of community choice aggregators.
If the commission authorizes or orders an electrical corporation to obtain generation resources pursuant to subparagraph (A), the commission shall ensure that those resources meet a system or local reliability need in a manner that benefits all customers of the electrical corporation. The commission shall allocate the costs of those generation resources to ratepayers in a manner that is fair and equitable to all customers, whether they receive electric service from the electrical corporation, a community choice aggregator, or an electric service provider.
The resource adequacy benefits of generation resources acquired by an electrical corporation pursuant to subparagraph (A) shall be allocated to all customers who pay their net capacity costs. Net capacity costs shall be determined by subtracting the energy and ancillary services value of the resource from the total costs paid by the electrical corporation pursuant to a contract with a third party or the annual revenue requirement for the resource if the electrical corporation directly owns the resource. An energy auction shall not be required as a condition for applying this allocation, but may be allowed as a means to establish the energy and ancillary services value of the resource for purposes of determining the net costs of capacity to be recovered from customers pursuant to this paragraph, and the allocation of the net capacity costs of contracts with third parties shall be allowed for the terms of those contracts.
It is the intent of the Legislature, in enacting this paragraph, to provide additional guidance to the commission with respect to the implementation of subdivision (g) of Section 380, and to ensure that the customers to whom the net costs and benefits of capacity are allocated are not required to pay for the cost of electricity they do not consume.
If the use of a centralized resource adequacy mechanism is authorized by the commission and has been implemented as set forth in paragraph (1), the net capacity costs of generation resources that the commission determines are required to meet urgent system or urgent local grid reliability needs, and that the commission authorizes to be procured outside of the Section 380 or Section 454.5 processes, shall be recovered according to paragraph (2) of subdivision (c).
On or before June 1, 2019, the commission shall issue an order regarding direct transactions that provides as follows:
Increase the maximum allowable total kilowatthours annual limit by 4,000 gigawatthours and apportion that increase among the service territories of the electrical corporations.
All residential and nonresidential customer accounts that are on direct access as of January 1, 2019, remain authorized to participate in direct transactions.
The commission shall ensure that bundled retail customers of an electrical corporation do not experience any cost increases as a result of retail customers of an electrical corporation electing to receive service from other providers. The commission shall also ensure that departing load does not experience any cost increases as a result of an allocation of costs that were not incurred on behalf of the departing load.
The commission shall post, in a consolidated location on its internet website, each load-serving entity’s residential electric rate tariffs and programs to enable customers and local governments to compare rates, services, environmental attributes, and other offerings. The documents posted shall include, but not be limited to, joint comparison rates for each community choice aggregator and electrical corporation and the disclosures required of retail sellers pursuant to Sections 398.4 and 398.5. This information shall be available and easily accessible on the load-serving entities’ internet websites.
Pursuant to subdivision (a), each load-serving entity shall make available to the commission all information about its residential electric rate tariffs and programs.
Dissemination of publicly available and factual information pursuant to subdivision (a) by a load-serving entity to a customer shall not constitute a violation of Section 707.
For purposes of this section, “load-serving entity” has the same meaning as in Section 380.
Nothing in this chapter shall prevent the commission from exercising its authority to investigate a process for certification and regulation of the rates, charges, terms, and conditions of default service. If the commission determines that a process for certification and regulation of default service is in the public interest, the commission shall submit its findings and recommendations to the Legislature for approval.
The commission shall take actions as needed to facilitate direct transactions between electricity suppliers and end-use customers. Customers shall be entitled to aggregate their electrical loads on a voluntary basis, provided that each customer does so by a positive written declaration. If no positive declaration is made by a customer, that customer shall continue to be served by the existing electrical corporation or its successor in interest, except aggregation by community choice aggregators, accomplished pursuant to Section 366.2.
Aggregation of customer electrical load shall be authorized by the commission for all customer classes, including, but not limited, to small commercial or residential customers. Aggregation may be accomplished by private market aggregators, special districts, or on any other basis made available by market opportunities and agreeable by positive written declaration by individual consumers, except aggregation by community choice aggregators, which shall be accomplished pursuant to Section 366.2.
As used in this section, the following terms have the following meanings:
“Department” means the Department of Water Resources with respect to its power program described in Chapter 2 (commencing with Section 80100) of Division 27 of the Water Code.
“Existing project participant” means a city with rights and obligations to the Magnolia Power Project under the Magnolia Power Project Planning Agreement, dated May 1, 2001.
“Magnolia Power Project” means a proposed natural gas-fired electric generating facility to be located at an existing site in Burbank and for which an application for certification has been filed with the State Energy Resources Conservation and Development Act (Docket No. 00-SIT-1) and deemed data adequate pursuant to the expedited six-month licensing process established under Section 25550 of the Public Resources Code.
Notwithstanding Section 80110 of the Water Code or Commission Decision 01-09-060, if the Magnolia Power Project has been constructed and is otherwise capable of beginning deliveries of electricity to the existing project participants, an existing project participant may serve as a community aggregator on behalf of all retail end-use customers within its jurisdiction.
Subdivision (b) shall not become operative until both of the following occur:
The commission implements a cost-recovery mechanism, consistent with subdivision (d), that is applicable to customers that elected to purchase electricity from an alternate provider between February 1, 2001, and the effective date of the act adding this section.
The commission submits a report certifying its satisfaction of paragraph (1) to the Senate Energy, Utilities and Communications Committee, or its successor, and the Assembly Committee on Utilities and Commerce, or its successor.
A retail end-use customer purchasing power from a community aggregator pursuant to subdivision (b) shall reimburse the department for all of the following:
A charge equivalent to the charge which would otherwise be imposed on the customer by the commission to recover bond related costs pursuant to an agreement between the commission and the Department of Water Resources pursuant to Section 80110 of the Water Code, that charge shall be payable until all obligations of the Department of Water Resources pursuant to Division 27 of the Water Code are fully paid or otherwise discharged.
The costs of the department, equal to the share of the department’s estimated net unavoidable power purchase contract costs attributable to the customer, as determined by the commission, for the period commencing with the customer’s purchases of electricity from a community aggregator, through the expiration of all then existing power purchase contracts entered into by the department.
A retail end-use customer purchasing power from a community aggregator pursuant to subdivision (b) shall reimburse the electrical corporation that previously served the customer for all of the following:
The electrical corporation’s unrecovered past undercollections, including all financing costs attributable to that customer, that the commission lawfully determines may be recovered in rates.
The costs of the electrical corporation recoverable in commission-approved rates, equal to the share of the electrical corporation’s estimated net unavoidable power purchase contract costs attributable to the customer, as determined by the commission, for the period commencing with the customer’s purchases of electricity from the community aggregator, through the expiration of all then existing power purchase contracts entered into by the electrical corporation.
A charge or cost imposed pursuant to subdivision (e), and all revenues received to pay the charge or cost, shall be the property of the Department of Water Resources. A charge or cost imposed pursuant to subdivision (f), and all revenues received to pay the charge or cost, shall be the property of the particular electrical corporation. The commission shall establish mechanisms, including agreements with, or orders with respect to, electrical corporations necessary to assure that the revenues received to pay a charge or cost payable pursuant to this section are promptly remitted to the party entitled to those revenues.
A charge or cost imposed pursuant to this section shall be nonbypassable.
Customers shall be entitled to aggregate their electrical loads as members of their local community with community choice aggregators.
Customers may aggregate their loads through a public process with community choice aggregators, if each customer is given an opportunity to opt out of the customer’s community’s aggregation program.
If a customer opts out of a community choice aggregator’s program, or has no community choice aggregation program available, that customer shall have the right to continue to be served by the existing electrical corporation or its successor in interest.
The implementation of a community choice aggregation program shall not result in a shifting of costs between the customers of the community choice aggregator and the bundled service customers of an electrical corporation.
A community choice aggregator shall be solely responsible for all generation procurement activities on behalf of the community choice aggregator’s customers, except where other generation procurement arrangements are expressly authorized by statute.
If a public agency seeks to serve as a community choice aggregator, it shall offer the opportunity to purchase electricity to all residential customers within its jurisdiction.
Notwithstanding Section 366, a community choice aggregator is hereby authorized to aggregate the electrical load of interested electricity consumers within its boundaries to reduce transaction costs to consumers, provide consumer protections, and leverage the negotiation of contracts. However, the community choice aggregator shall not aggregate electrical load if that load is served by a local publicly owned electric utility. A community choice aggregator may group retail electricity customers to solicit bids, broker, and contract for electricity and energy services for those customers. The community choice aggregator may enter into agreements for services to facilitate the sale and purchase of electricity and other related services. Those service agreements may be entered into by an entity authorized to be a community choice aggregator, as defined in Section 331.1.
Under community choice aggregation, customer participation shall not require a positive written declaration, but each customer shall be informed of the customer’s right to opt out of the community choice aggregation program. If no negative declaration is made by a customer, that customer shall be served through the community choice aggregation program. If an existing customer moves the location of the customer’s electrical service within the jurisdiction of the community choice aggregator, the customer shall retain the same subscriber status as before the move, unless the customer affirmatively changes the customer’s subscriber status. If the customer is moving from outside to inside the jurisdiction of the community choice aggregator, customer participation shall not require a positive written declaration, but the customer shall be informed of the customer’s right to elect not to receive service through the community choice aggregator.
A community choice aggregator establishing electrical load aggregation pursuant to this section shall develop an implementation plan detailing the process and consequences of aggregation. The implementation plan, and any subsequent changes to it, shall be considered and adopted at a duly noticed public hearing. The implementation plan shall contain all of the following:
An organizational structure of the program, its operations, and its funding.
Ratesetting and other costs to participants.
Provisions for disclosure and due process in setting rates and allocating costs among participants.
The methods for entering and terminating agreements with other entities.
The rights and responsibilities of program participants, including, but not limited to, consumer protection procedures, credit issues, and shutoff procedures.
Termination of the program.
A description of the third parties that will be supplying electricity under the program, including, but not limited to, information about financial, technical, and operational capabilities.
The methods for ensuring procurement from small, local, and diverse business enterprises in all categories, including, but not limited to, renewable energy, energy storage system, and smart grid projects.
A community choice aggregator establishing electrical load aggregation shall prepare a statement of intent with the implementation plan. Any community choice load aggregation established pursuant to this section shall provide for all of the following:
Universal access.
Reliability.
Equitable treatment of all classes of customers.
Any requirements established by state law or by the commission concerning aggregated service, including those rules adopted by the commission pursuant to paragraph (3) of subdivision (b) of Section 8341 for the application of the greenhouse gases emission performance standard to community choice aggregators.
In order to determine the cost-recovery mechanism to be imposed on the community choice aggregator pursuant to subdivisions (d), (e), and (f) that shall be paid by the customers of the community choice aggregator to prevent shifting of costs, the community choice aggregator shall file the implementation plan with the commission, and any other information requested by the commission that the commission determines is necessary to develop the cost-recovery mechanism in subdivisions (d), (e), and (f).
The commission shall notify any electrical corporation serving the customers proposed for aggregation that an implementation plan initiating community choice aggregation has been filed, within 10 days of the filing.
Within 90 days after the community choice aggregator establishing load aggregation files its implementation plan, the commission shall certify that it has received the implementation plan, including any additional information necessary to determine a cost-recovery mechanism. After certification of receipt of the implementation plan and any additional information requested, the commission shall then provide the community choice aggregator with its findings regarding any cost recovery that must be paid by customers of the community choice aggregator to prevent a shifting of costs as provided for in subdivisions (d), (e), and (f).
An entity proposing community choice aggregation shall not furnish electricity to electricity consumers within its boundaries until the commission determines the cost recovery that must be paid by the customers of that proposed community choice aggregation program, as provided for in subdivisions (d), (e), and (f). The commission shall designate the earliest possible effective date for implementation of a community choice aggregation program, taking into consideration the impact on any annual procurement plan of the electrical corporation that has been approved by the commission.
All electrical corporations shall cooperate fully with any community choice aggregators that investigate, pursue, or implement community choice aggregation programs. Cooperation shall include providing the entities with appropriate billing and electrical load data, including, but not limited to, electrical consumption data as defined in Section 8380 and other data detailing electricity needs and patterns of usage, as determined by the commission, and in accordance with procedures established by the commission. The commission shall exercise its authority pursuant to Chapter 11 (commencing with Section 2100) to enforce the requirements of this paragraph when it finds that the requirements of this paragraph have been violated. Electrical corporations shall continue to provide all metering, billing, collection, and customer service to retail customers that participate in community choice aggregation programs. Bills sent by the electrical corporation to retail customers shall identify the community choice aggregator as providing the electrical energy component of the bill. The commission shall determine the terms and conditions under which the electrical corporation provides services to community choice aggregators and retail customers.
If the commission finds that an electrical corporation has violated this section, the commission shall consider the impact of the violation on community choice aggregators.
The commission shall proactively expedite the complaint process for disputes regarding an electrical corporation’s violation of its obligations pursuant to this section in order to provide for timely resolution of complaints made by community choice aggregation programs, so that all complaints are resolved in no more than 180 days following the filing of a complaint by a community choice aggregation program concerning the actions of the incumbent electrical corporation. This deadline may only be extended under either of the following circumstances:
Upon agreement of all of the parties to the complaint.
The commission makes a written determination that the deadline cannot be met, including findings for the reason for this determination, and issues an order extending the deadline. A single order pursuant to this subparagraph shall not extend the deadline for more than 60 days.
An entity authorized to be a community choice aggregator, as defined in Section 331.1, that elects to implement a community choice aggregation program within its jurisdiction pursuant to this chapter, shall do so by ordinance. A city, county, or city and county may request, by affirmative resolution of its governing council or board, that another entity authorized to be a community choice aggregator act as the community choice aggregator on its behalf. If a city, county, or city and county, by resolution, requests another authorized entity be the community choice aggregator for the city, county, or city and county, that authorized entity shall be responsible for adopting the ordinance to implement the community choice aggregation program on behalf of the city, county, or city and county.
Two or more entities authorized to be a community choice aggregator, as defined in Section 331.1, may participate as a group in a community choice aggregation program pursuant to this chapter, through a joint powers agency established pursuant to Chapter 5 (commencing with Section 6500) of Division 7 of Title 1 of the Government Code, if each entity adopts an ordinance pursuant to subparagraph (A). Pursuant to Section 6508.1 of the Government Code, members of a joint powers agency that is a community choice aggregator may specify in the joint powers agreement that, unless otherwise agreed by the members of the agency, the debts, liabilities, and obligations of the agency shall not be the debts, liabilities, and obligations, either jointly or severally, of the members of the agency. The commission shall not, as a condition of registration or otherwise, require an agency’s members to voluntarily assume the debts, liabilities, and obligations of the agency to the electrical corporation unless the commission finds that the agreement by the agency’s members is the only reasonable means by which the agency may establish its creditworthiness under the electrical corporation’s tariff to pay charges to the electrical corporation under the tariff.
Following adoption of aggregation through the ordinance described in paragraph (12), the program shall allow any retail customer to opt out and to continue to be served as a bundled service customer by the existing electrical corporation, or its successor in interest. Delivery services shall be provided at the same rates, terms, and conditions, as approved by the commission, for community choice aggregation customers and customers that have entered into a direct transaction where applicable, as determined by the commission. Once enrolled in the aggregated entity, any ratepayer that chooses to opt out within 60 days or two billing cycles of the date of enrollment may do so without penalty and shall be entitled to receive default service pursuant to paragraph (3) of subdivision (a). Customers that return to the electrical corporation for procurement services shall be subject to the same terms and conditions as are applicable to other returning direct access customers from the same class, as determined by the commission, as authorized by the commission pursuant to this code or any other law, except that those customers shall be subject to no more than a 12-month stay requirement with the electrical corporation. Any reentry fees to be imposed after the opt-out period specified in this paragraph, shall be approved by the commission and shall reflect the cost of reentry. The commission shall exclude any amounts previously determined and paid pursuant to subdivisions (d), (e), and (f) from the cost of reentry.
This section does not authorize any city or any community choice retail load aggregator to restrict the ability of retail electricity customers to obtain or receive service from any authorized electric service provider in a manner consistent with law.
The community choice aggregator shall fully inform participating customers at least twice within two calendar months, or 60 days, in advance of the date of commencing automatic enrollment. Notifications may occur concurrently with billing cycles. Following enrollment, the aggregated entity shall fully inform participating customers for not less than two consecutive billing cycles. Notification may include, but is not limited to, direct mailings to customers, or inserts in water, sewer, or other utility bills. Any notification shall inform customers of both of the following:
That the customer is to be automatically enrolled and that the customer has the right to opt out of the community choice aggregator without penalty.
The terms and conditions of the services offered.
The community choice aggregator may request the commission to approve and order the electrical corporation to provide the notification required in subparagraph (A). If the commission orders the electrical corporation to send one or more of the notifications required pursuant to subparagraph (A) in the electrical corporation’s normally scheduled monthly billing process, the electrical corporation shall be entitled to recover from the community choice aggregator all reasonable incremental costs it incurs related to the notification or notifications. The electrical corporation shall fully cooperate with the community choice aggregator in determining the feasibility and costs associated with using the electrical corporation’s normally scheduled monthly billing process to provide one or more of the notifications required pursuant to subparagraph (A).
Each notification shall also include a mechanism by which a ratepayer may opt out of community choice aggregated service. The opt out may take the form of a self-addressed return postcard indicating the customer’s election to remain with, or return to, electrical service provided by the electrical corporation, or another straightforward means by which the customer may elect to derive electrical service through the electrical corporation providing service in the area.
A community choice aggregator shall have an operating service agreement with the electrical corporation before furnishing electric service to consumers within its jurisdiction. The service agreement shall include performance standards that govern the business and operational relationship between the community choice aggregator and the electrical corporation. The commission shall ensure that any service agreement between the community choice aggregator and the electrical corporation includes equitable responsibilities and remedies for all parties. The parties may negotiate specific terms of the service agreement, provided that the service agreement is consistent with this chapter.
The community choice aggregator shall register with the commission, which may require additional information to ensure compliance with basic consumer protection rules and other procedural matters.
Once the community choice aggregator’s contract is signed, the community choice aggregator shall notify the applicable electrical corporation that community choice service will commence within 30 days.
Once notified of a community choice aggregator program, the electrical corporation shall transfer all applicable accounts to the new supplier within a 30-day period from the date of the close of the electrical corporation’s normally scheduled monthly metering and billing process.
An electrical corporation shall recover from the community choice aggregator any costs reasonably attributable to the community choice aggregator, as determined by the commission, of implementing this section, including, but not limited to, all business and information system changes, except for transaction-based costs as described in this paragraph. Any costs not reasonably attributable to a community choice aggregator shall be recovered from ratepayers, as determined by the commission. All reasonable transaction-based costs of notices, billing, metering, collections, and customer communications or other services provided to an aggregator or its customers shall be recovered from the aggregator or its customers on terms and at rates to be approved by the commission.
At the request and expense of any community choice aggregator, electrical corporations shall install, maintain, and calibrate metering devices at mutually agreeable locations within or adjacent to the community choice aggregator’s political boundaries. The electrical corporation shall read the metering devices and provide the data collected to the community choice aggregator at the aggregator’s expense. To the extent that the community choice aggregator requests a metering location that would require alteration or modification of a circuit, the electrical corporation shall only be required to alter or modify a circuit if such alteration or modification does not compromise the safety, reliability, or operational flexibility of the electrical corporation’s facilities. All costs incurred to modify circuits pursuant to this paragraph shall be borne by the community choice aggregator.
A retail end-use customer that purchases electricity from a community choice aggregator pursuant to this section shall pay both of the following:
A charge equivalent to the charges that would otherwise be imposed on the customer by the commission to recover bond-related costs pursuant to any agreement between the commission and the Department of Water Resources pursuant to Section 80110 of the Water Code, which charge shall be payable until any obligations of the Department of Water Resources pursuant to Division 27 (commencing with Section 80000) of the Water Code are fully paid or otherwise discharged.
Any additional costs of the Department of Water Resources, equal to the customer’s proportionate share of the Department of Water Resources’ estimated net unavoidable electricity purchase contract costs as determined by the commission, for the period commencing with the customer’s purchases of electricity from the community choice aggregator, through the expiration of all then existing electricity purchase contracts entered into by the Department of Water Resources.
A retail end-use customer purchasing electricity from a community choice aggregator pursuant to this section shall reimburse the electrical corporation that previously served the customer for all of the following:
The electrical corporation’s unrecovered past undercollections for electricity purchases, including any financing costs, attributable to that customer, that the commission lawfully determines may be recovered in rates.
Any additional costs of the electrical corporation recoverable in commission-approved rates, equal to the share of the electrical corporation’s estimated net unavoidable electricity purchase contract costs attributable to the customer, as determined by the commission, for the period commencing with the customer’s purchases of electricity from the community choice aggregator, through the expiration of all then existing electricity purchase contracts entered into by the electrical corporation.
Estimated net unavoidable electricity costs paid by the customers of a community choice aggregator shall be reduced by the value of any benefits that remain with bundled service customers, unless the customers of the community choice aggregator are allocated a fair and equitable share of those benefits.
Any charges imposed pursuant to subdivision (e) shall be the property of the Department of Water Resources. Any charges imposed pursuant to subdivision (f) shall be the property of the electrical corporation. The commission shall establish mechanisms, including agreements with, or orders with respect to, electrical corporations necessary to ensure that charges payable pursuant to this section shall be promptly remitted to the party entitled to payment.
Charges imposed pursuant to subdivisions (d), (e), and (f) shall be nonbypassable.
The commission shall authorize community choice aggregation only if the commission imposes a cost-recovery mechanism pursuant to subdivisions (d), (e), (f), and (h). Except as provided by this subdivision, this section shall not alter the suspension by the commission of direct purchases of electricity from alternate providers other than by community choice aggregators, pursuant to Section 365.1.
The commission shall not authorize community choice aggregation until it implements a cost-recovery mechanism, consistent with subdivisions (d), (e), and (f), that is applicable to customers that elected to purchase electricity from an alternate provider between February 1, 2001, and January 1, 2003.
The commission shall not authorize community choice aggregation until it has adopted rules for implementing community choice aggregation.
Except for nonbypassable charges imposed by the commission pursuant to subdivisions (d), (e), (f), and (h), and programs authorized by the commission to provide broader statewide or regional benefits to all customers, electric service customers of a community choice aggregator shall not be required to pay nonbypassable charges for goods, services, or programs that do not benefit either, or where applicable, both, the customer and the community choice aggregator serving the customer.
The commission, the Energy Commission, an electrical corporation, or a third-party administrator shall administer any program funded through a nonbypassable charge on a nondiscriminatory basis so that the electric service customers of a community choice aggregator may participate in the program on an equal basis with the customers of an electrical corporation.
This subdivision does not modify, or prohibit the use of, charges funding programs for the benefit of low-income customers.
The commission shall require each community choice aggregator with gross annual revenues exceeding fifteen million dollars ($15,000,000) to annually submit a report to the commission regarding its procurement from women, minority, disabled veteran, and LGBT business enterprises in all categories, including, but not limited to, renewable energy, energy storage system, and smart grid projects.
The report shall be in a form that the commission may require and shall be submitted by an annual date that the commission shall designate.
The report shall include women, minority, disabled veteran, and LGBT business enterprises with whom a prime contractor or grantee of a community choice aggregator has engaged in contracts or subcontracts for all categories, including, but not limited to, renewable energy, energy storage system, and smart grid projects.
Any meeting of an entity authorized to be a community choice aggregator, as defined in Section 331.1, for the purpose of developing, implementing, or administering a program of community choice aggregation shall be conducted in the manner prescribed by the Ralph M. Brown Act (Chapter 9 (commencing with Section 54950) of Part 1 of Division 2 of Title 5 of the Government Code).
As part of each annual report required pursuant to subdivision (m), each community choice aggregator shall provide all of the following information in the aggregate:
The number of new contractors and subcontractors certified pursuant to General Order 156 with which it contracted.
The total dollar amounts expended with in-state contractors certified under General Order 156.
The total dollar amounts expended with in-state subcontractors certified under General Order 156.
The percentage of the total workforce used by contractors and subcontractors that reside in California.
Data regarding the diversity of contractor or subcontractor workforces, to the extent that the data is provided voluntarily by the employees of the contractor or subcontractor.
A community choice aggregator may use data provided to the commission pursuant to subdivision (b) of Section 8284 to satisfy the requirements of paragraph (1).
For purposes of this section, “disabled veteran business enterprise,” “LGBT business enterprise,” “minority business enterprise,” “renewable energy project,” and “women business enterprise,” are defined as in Section 8282.
Bundled retail customers of an electrical corporation shall not experience any cost increase as a result of the implementation of a community choice aggregator program. The commission shall also ensure that departing load does not experience any cost increases as a result of an allocation of costs that were not incurred on behalf of the departing load.
No change in the aggregator or supplier of electric power for any small commercial customer may be made until one of the following means of confirming the change has been completed:
Independent third-party telephone verification.
Receipt of a written confirmation received in the mail from the consumer after the consumer has received an information package confirming the agreement.
The customer signs a document fully explaining the nature and effect of the change in service.
The customer’s consent is obtained through electronic means, including, but not limited to, computer transactions.
No change in the aggregator or provider of electric power for any residential customer may be made over the telephone until the change has been confirmed by an independent third-party verification company, as follows:
The third-party verification company shall meet each of the following criteria:
Be independent from the entity that seeks to provide the new service.
Not be directly or indirectly managed, controlled, or directed, or owned wholly or in part, by an entity that seeks to provide the new service or by any corporation, firm, or person who directly or indirectly manages, controls, or directs, or owns more than 5 percent of the entity.
Operate from facilities physically separate from those of the entity that seeks to provide the new service.
Not derive commission or compensation based upon the number of sales confirmed.
The entity seeking to verify the sale shall do so by connecting the resident by telephone to the third-party verification company or by arranging for the third-party verification company to call the customer to confirm the sale.
The third-party verification company shall obtain the customer’s oral confirmation regarding the change, and shall record that confirmation by obtaining appropriate verification data. The record shall be available to the customer upon request. Information obtained from the customer through confirmation shall not be used for marketing purposes. Any unauthorized release of this information is grounds for a civil suit by the aggrieved resident against the entity or its employees who are responsible for the violation.
Notwithstanding paragraphs (1), (2), and (3), an aggregator or provider of electric power shall not be required to comply with these provisions when the customer directly calls an aggregator or provider of electric power to change service providers. However, an aggregator or provider of electric power shall not avoid the verification requirements by asking a customer to contact an aggregator or provider of electric power directly to make any change in the service provider.
No change in the aggregator or provider of electric power for any residential customer may be made via an Internet transaction, in which the customer accesses the website of the aggregator or provider, unless both of the following occur with respect to confirming the change:
Any aggregator or provider of electric power offering electricity service to residential and small commercial customers that switches the electric service of a customer without the customer’s consent shall be liable to the aggregator or provider of electric power offering electricity services previously selected by the customer in an amount equal to all charges paid by the customer after the violation and shall refund to the customer any amount in excess of the amount that the customer would have been obligated to pay had the customer not been switched.
An aggregator or provider of electric power shall keep a record of the confirmation of a change pursuant to subdivision (b), (c), or (d) for two years from the date of that confirmation, and shall make those records available, upon request, to the customer and to the commission in the course of a commission investigation of a customer complaint or an investigation pursuant to subdivision (c) of Section 394.2.
Public agencies are exempt from this section to the extent they are serving customers within their jurisdiction.
Notwithstanding subdivisions (c) and (d), the commission may require third-party verification for all residential changes to electric service providers if it finds that the application of subdivisions (c) and (d) results in the unauthorized changing of a customer’s electric service provider.
An electrical corporation is exempt from this section for customers that default to the service of the electrical corporation.
Electric power sold to customers pursuant to Section 80100 of the Water Code is not subject to this section.
The commission shall identify and determine those costs and categories of costs for generation-related assets and obligations, consisting of generation facilities, generation-related regulatory assets, nuclear settlements, and power purchase contracts, including, but not limited to, restructurings, renegotiations or terminations thereof approved by the commission, that were being collected in commission-approved rates on December 20, 1995, and that may become uneconomic as a result of a competitive generation market, in that these costs may not be recoverable in market prices in a competitive market, and appropriate costs incurred after December 20, 1995, for capital additions to generating facilities existing as of December 20, 1995, that the commission determines are reasonable and should be recovered, provided that these additions are necessary to maintain the facilities through December 31, 2001. These uneconomic costs shall include transition costs as defined in subdivision (f) of Section 840, and shall be recovered from all customers or in the case of fixed transition amounts, from the customers specified in subdivision (a) of Section 841, on a nonbypassable basis and shall:
Be amortized over a reasonable time period, including collection on an accelerated basis, consistent with not increasing rates for any rate schedule, contract, or tariff option above the levels in effect on June 10, 1996; provided that, the recovery shall not extend beyond December 31, 2001, except as follows:
Costs associated with employee-related transition costs as set forth in subdivision (b) of Section 375 shall continue until fully collected; provided, however, that the cost collection shall not extend beyond December 31, 2006.
Power purchase contract obligations shall continue for the duration of the contract. Costs associated with any buy-out, buy-down, or renegotiation of the contracts shall continue to be collected for the duration of any agreement governing the buy-out, buy-down, or renegotiated contract; provided, however, no power purchase contract shall be extended as a result of the buy-out, buy-down, or renegotiation.
Costs associated with contracts approved by the commission to settle issues associated with the Biennial Resource Plan Update may be collected through March 31, 2002; provided that only 80 percent of the balance of the costs remaining after December 31, 2001, shall be eligible for recovery.
Nuclear incremental cost incentive plans for the San Onofre nuclear generating station shall continue for the full term as authorized by the commission in Decision 96-01-011 and Decision 96-04-059; provided that the recovery shall not extend beyond December 31, 2003.
Costs associated with the exemptions provided in subdivision (a) of Section 374 may be collected through March 31, 2002, provided that only fifty million dollars ($50,000,000) of the balance of the costs remaining after December 31, 2001, shall be eligible for recovery.
Fixed transition amounts, as defined in subdivision (d) of Section 840, may be recovered from the customers specified in subdivision (a) of Section 841 until all rate reduction bonds associated with the fixed transition amounts have been paid in full by the financing entity.
Be based on a calculation mechanism that nets the negative value of all above market utility-owned generation-related assets against the positive value of all below market utility-owned generation related assets. For those assets subject to valuation, the valuations used for the calculation of the uneconomic portion of the net book value shall be determined not later than December 31, 2001, and shall be based on appraisal, sale, or other divestiture. The commission’s determination of the costs eligible for recovery and of the valuation of those assets at the time the assets are exposed to market risk or retired, in a proceeding under Section 455.5, 851, or otherwise, shall be final, and notwithstanding Section 1708 or any other provision of law, may not be rescinded, altered or amended.
Be limited in the case of utility-owned fossil generation to the uneconomic portion of the net book value of the fossil capital investment existing as of January 1, 1998, and appropriate costs incurred after December 20, 1995, for capital additions to generating facilities existing as of December 20, 1995, that the commission determines are reasonable and should be recovered, provided that the additions are necessary to maintain the facilities through December 31, 2001. All “going forward costs” of fossil plant operation, including operation and maintenance, administrative and general, fuel and fuel transportation costs, shall be recovered solely from independent Power Exchange revenues or from contracts with the Independent System Operator, provided that for the purposes of this chapter, the following costs may be recoverable pursuant to this section:
Commission-approved operating costs for particular utility-owned fossil powerplants or units, at particular times when reactive power/voltage support is not yet procurable at market-based rates in locations where it is deemed needed for the reactive power/voltage support by the Independent System Operator, provided that the units are otherwise authorized to recover market-based rates and provided further that for an electrical corporation that is also a gas corporation and that serves at least four million customers as of December 20, 1995, the commission shall allow the electrical corporation to retain any earnings from operations of the reactive power/voltage support plants or units and shall not require the utility to apply any portions to offset recovery of transition costs. Cost recovery under the cost recovery mechanism shall end on December 31, 2001.
An electrical corporation that, as of December 20, 1995, served at least four million customers, and that was also a gas corporation that served less than four thousand customers, may recover, pursuant to this section, 100 percent of the uneconomic portion of the fixed costs paid under fuel and fuel transportation contracts that were executed prior to December 20, 1995, and were subsequently determined to be reasonable by the commission, or 100 percent of the buy-down or buy-out costs associated with the contracts to the extent the costs are determined to be reasonable by the commission.
Be adjusted throughout the period through March 31, 2002, to track accrual and recovery of costs provided for in this subdivision. Recovery of costs prior to December 31, 2001, shall include a return as provided for in Decision 95-12-063, as modified by Decision 96-01-009, together with associated taxes.
Be allocated among the various classes of customers, rate schedules, and tariff options to ensure that costs are recovered from these classes, rate schedules, contract rates, and tariff options, including self-generation deferral, interruptible, and standby rate options in substantially the same proportion as similar costs are recovered as of June 10, 1996, through the regulated retail rates of the relevant electric utility, provided that there shall be a firewall segregating the recovery of the costs of competition transition charge exemptions such that the costs of competition transition charge exemptions granted to members of the combined class of residential and small commercial customers shall be recovered only from these customers, and the costs of competition transition charge exemptions granted to members of the combined class of customers, other than residential and small commercial customers, shall be recovered only from these customers.
Individual customers shall not experience rate increases as a result of the allocation of transition costs. However, customers who elect to purchase energy from suppliers other than the Power Exchange through a direct transaction, may incur increases in the total price they pay for electricity to the extent the price for the energy exceeds the Power Exchange price.
The commission shall retain existing cost allocation authority, provided the firewall and rate freeze principles are not violated.
It is the intent of the Legislature in enacting this section to ensure that individual customers do not experience rate increases as a result of the allocation of transition costs, in accordance with paragraph (2) of subdivision (e) of Section 367.
The commission shall implement a methodology whereby the Power Exchange energy credit for a customer with a meter installed on or after June 30, 2000, that is capable of recording hourly data is calculated based on the actual hourly data for that customer. The Power Exchange energy credit for a customer with a meter installed before June 30, 2000, that is capable of recording hourly data shall, at the election of the customer, on a one-time basis before June 30, 2000, be calculated based on either (1) the actual hourly data for that customer or (2) the average load profile for that customer class. If the customer fails to make an election, that customer’s Power Exchange energy credit shall continue to be based on the average load profile for that customer class.
Additional incremental billing costs incurred as a result of the methodology implemented by the commission pursuant to subdivision (b) may be recoverable through rates for that customer class, if the commission finds that the costs are reasonable.
The methodology implemented by the commission pursuant to subdivisions (b) and (c) shall not result in any shifts in cost between customer classes and shall be consistent with the firewall provision set forth in subdivision (e) of Section 367.
Each electrical corporation shall propose a cost recovery plan to the commission for the recovery of the uneconomic costs of an electrical corporation’s generation-related assets and obligations identified in Section 367. The commission shall authorize the electrical corporation to recover the costs pursuant to the plan if the plan meets the following criteria:
The cost recovery plan shall set rates for each customer class, rate schedule, contract, or tariff option, at levels equal to the level as shown on electric rate schedules as of June 10, 1996, provided that rates for residential and small commercial customers shall be reduced so that these customers shall receive rate reductions of no less than 10 percent for 1998 continuing through 2002. These rate levels for each customer class, rate schedule, contract, or tariff option shall remain in effect until the earlier of March 31, 2002, or the date on which the commission-authorized costs for utility generation-related assets and obligations have been fully recovered. The electrical corporation shall be at risk for those costs not recovered during that time period. Each utility shall amortize its total uneconomic costs, to the extent possible, such that for each year during the transition period its recorded rate of return on the remaining uneconomic assets does not exceed its authorized rate of return for those assets. For purposes of determining the extent to which the costs have been recovered, any over-collections recorded in Energy Costs Adjustment Clause and Electric Revenue Adjustment Mechanism balancing accounts, as of December 31, 1996, shall be credited to the recovery of the costs.
The cost recovery plan shall provide for identification and separation of individual rate components such as charges for energy, transmission, distribution, public benefit programs, and recovery of uneconomic costs. The separation of rate components required by this subdivision shall be used to ensure that customers of the electrical corporation who become eligible to purchase electricity from suppliers other than the electrical corporation pay the same unbundled component charges, other than energy, that a bundled service customer pays. No cost shifting among customer classes, rate schedules, contract, or tariff options shall result from the separation required by this subdivision. Nothing in this provision is intended to affect the rates, terms, and conditions or to limit the use of any Federal Energy Regulatory Commission-approved contract entered into by the electrical corporation prior to the effective date of this provision.
In consideration of the risk that the uneconomic costs identified in Section 367 may not be recoverable within the period identified in subdivision (a) of Section 367, an electrical corporation that, as of December 20, 1995, served more than four million customers, and was also a gas corporation that served less than four thousand customers, shall have the flexibility to employ risk management tools, such as forward hedges, to manage the market price volatility associated with unexpected fluctuations in natural gas prices, and the out-of-pocket costs of acquiring the risk management tools shall be considered reasonable and collectible within the transition freeze period. This subdivision applies only to the transaction costs associated with the risk management tools and shall not include any losses from changes in market prices.
In order to ensure implementation of the cost recovery plan, the limitation on the maximum amount of cost recovery for nuclear facilities that may be collected in any year adopted by the commission in Decision 96-01-011 and Decision 96-04-059 shall be eliminated to allow the maximum opportunity to collect the nuclear costs within the transition cap period.
As to an electrical corporation that is also a gas corporation serving more than four million California customers, so long as any cost recovery plan adopted in accordance with this section satisfies subdivision (a), it shall also provide for annual increases in base revenues, effective January 1, 1997, and January 1, 1998, equal to the inflation rate for the prior year plus two percentage points, as measured by the consumer price index. The increase shall do both of the following:
Remain in effect pending the next general rate case review, which shall be filed not later than December 31, 1997, for rates that would become effective in January 1999. For purposes of any commission-approved performance-based ratemaking mechanism or general rate case review, the increases in base revenue authorized by this subdivision shall create no presumption that the level of base revenue reflecting those increases constitute the appropriate starting point for subsequent revenues.
Be used by the utility for the purposes of enhancing its transmission and distribution system safety and reliability, including, but not limited to, vegetation management and emergency response. To the extent the revenues are not expended for system safety and reliability, they shall be credited against subsequent safety and reliability base revenue requirements. Any excess revenues carried over shall not be used to pay any monetary sanctions imposed by the commission.
The cost recovery plan shall provide the electrical corporation with the flexibility to manage the renegotiation, buy-out, or buy-down of the electrical corporation’s power purchase obligations, consistent with review by the commission to assure that the terms provide net benefits to ratepayers and are otherwise reasonable in protecting the interests of both ratepayers and shareholders.
An example of a plan authorized by this section is the document entitled “Restructuring Rate Settlement” transmitted to the commission by Pacific Gas and Electric Company on June 12, 1996.
Notwithstanding any other provision of law, upon the termination of the 10-percent rate reduction for residential and small commercial customers set forth in subdivision (a) of Section 368, the commission may not subject those residential and small commercial customers to any rate increases or future rate obligations solely as a result of the termination of the 10-percent rate reduction.
The provisions of subdivision (a) do not affect the authority of the commission to raise rates for reasons other than the termination of the 10-percent rate reduction set forth in subdivision (a) of Section 368.
Nothing in this section shall further extend the authority to impose fixed transition amounts, as defined in subdivision (d) of Section 840, or further authorize or extend rate reduction bonds, as defined in subdivision (e) of Section 840.
The commission shall establish an effective mechanism that ensures recovery of transition costs referred to in Sections 367, 368, 375, and 376, and subject to the conditions in Sections 371 to 374, inclusive, from all existing and future consumers in the service territory in which the utility provided electricity services as of December 20, 1995; provided, that the costs shall not be recoverable for new customer load or incremental load of an existing customer where the load is being met through a direct transaction and the transaction does not otherwise require the use of transmission or distribution facilities owned by the utility. However, the obligation to pay the competition transition charges cannot be avoided by the formation of a local publicly owned electrical corporation on or after December 20, 1995, or by annexation of any portion of an electrical corporation’s service area by an existing local publicly owned electric utility.
This section shall not apply to service taken under tariffs, contracts, or rate schedules that are on file, accepted, or approved by the Federal Energy Regulatory Commission, unless otherwise authorized by the Federal Energy Regulatory Commission.
On or before December 31, 2026, the commission, in consultation with the Energy Commission, shall develop a framework for assessing, tracking, and analyzing total annual energy costs paid by residential households in California. The framework shall include all of the following:
A methodology for identifying, categorizing, and quantifying major residential household energy sources.
The total annual energy costs borne by residential households.
Annual costs for major residential household energy sources, including, but not limited to, electricity, natural gas, propane, gasoline, and diesel.
Changes in the total annual energy costs for residential households over time.
The relative contributions of different energy sources to the total annual energy costs borne by residential households.
The annual growth rate of energy costs for residential households by energy source.
Projections of possible future total energy costs for residential households for the next 10 years.
Scenarios of actions that may lead to a 5 percent, 10 percent, and 15 percent reduction in total annual energy costs paid by residential households in 2035, relative to 2024 total annual energy costs after adjusting for inflation.
An assessment of the actions identified pursuant to paragraph (8) and the effects they may have on public health and safety, electrical and gas system reliability, and the achievement of the state’s 2045 clean electricity goal developed pursuant to Section 454.53 and the state’s 2045 carbon neutrality goal developed pursuant to Section 38562.2 of the Health and Safety Code.
The commission may use the total annual energy cost framework pursuant to subdivision (a) for purposes of evaluating any request by an electrical corporation and gas corporation to track new spending eligible for recovery or to adjust a revenue requirement. In evaluating any such request, the commission shall consider whether the electrical corporation and gas corporation should take additional actions to achieve the reductions in total annual energy costs identified in paragraph (8) of subdivision (a).
On or before December 31, 2026, the commission shall submit a report to the Legislature containing the framework and the information in subdivision (a).
Pursuant to Section 10231.5 of the Government Code, this subdivision shall become inoperative on December 31, 2030.
The commission shall require, as a prerequisite for any consumer in California to engage in direct transactions permitted in Section 365, that beginning with the commencement of these direct transactions, the consumer shall have an obligation to pay the costs provided in Sections 367, 368, 375, and 376, and subject to the conditions in Sections 371 to 374, inclusive, directly to the electrical corporation providing electricity service in the area in which the consumer is located. This obligation shall be set forth in the applicable rate schedule, contract, or tariff option under which the customer is receiving service from the electrical corporation. To the extent the consumer does not use the electrical corporation’s facilities for direct transaction, the obligation to pay shall be confirmed in writing, and the customer shall be advised by any electricity marketer engaged in the transaction of the requirement that the customer execute a confirmation. The requirement for marketers to inform customers of the written requirement shall cease on January 1, 2002.
Except as provided in Sections 372 and 374, the uneconomic costs provided in Sections 367, 368, 375, and 376 shall be applied to each customer based on the amount of electricity purchased by the customer from an electrical corporation or alternate supplier of electricity, subject to changes in usage occurring in the normal course of business.
Changes in usage occurring in the normal course of business are those resulting from changes in business cycles, termination of operations, departure from the utility service territory, weather, reduced production, modifications to production equipment or operations, changes in production or manufacturing processes, fuel switching, including installation of fuel cells pending a contrary determination by the Energy Commission, enhancement or increased efficiency of equipment or performance of existing self-cogeneration equipment, replacement of existing cogeneration equipment with new power generation equipment of similar size as described in paragraph (1) of subdivision (a) of Section 372, installation of demand-side management equipment or facilities, energy conservation efforts, or other similar factors.
This section does not exempt or alter the obligation of a customer to comply with Chapter 5 (commencing with Section 119075) of Part 15 of Division 104 of the Health and Safety Code. This section does not limit the ability of residential customers to alter their pattern of electricity purchases by activities on the customer side of the meter.
Enhancement or increased efficiency of equipment, as described in subdivision (b), shall include industrial process heat recovery technology that meets the requirements of Section 451.7.
It is the policy of the state to encourage and support the development of cogeneration as an efficient, environmentally beneficial, competitive energy resource that will enhance the reliability of local generation supply, and promote local business growth. Subject to the specific conditions provided in this section, the commission shall determine the applicability to customers of uneconomic costs as specified in Sections 367, 368, 375, and 376. Consistent with this state policy, the commission shall provide that these costs shall not apply to any of the following:
To load served onsite or under an over-the-fence arrangement by a nonmobile self-cogeneration or cogeneration facility that was operational on or before December 20, 1995, or by increases in the capacity of a facility to the extent that the increased capacity was constructed by an entity holding an ownership interest in or operating the facility and does not exceed 120 percent of the installed capacity as of December 20, 1995, provided that before June 30, 2000, the costs shall apply to over-the-fence arrangements entered into after December 20, 1995, between unaffiliated parties. For the purposes of this subdivision, “affiliated” means any person or entity that directly, or indirectly through one or more intermediaries, controls, is controlled by, or is under common control with another specified entity. “Control” means either of the following:
The possession, directly or indirectly, of the power to direct or to cause the direction of the management or policies of a person or entity, whether through an ownership, beneficial, contractual, or equitable interest.
Direct or indirect ownership of at least 25 percent of an entity, whether through an ownership, beneficial, or equitable interest.
To load served onsite or under an over-the-fence arrangement by a nonmobile self-cogeneration or cogeneration facility for which the customer was committed to construction as of December 20, 1995, provided that the facility was substantially operational on or before January 1, 1998, or by increases in the capacity of a facility to the extent that the increased capacity was constructed by an entity holding an ownership interest in or operating the facility and does not exceed 120 percent of the installed capacity as of January 1, 1998, provided that before June 30, 2000, the costs shall apply to over-the-fence arrangements entered into after December 20, 1995, between unaffiliated parties.
To load served by existing, new, or portable emergency generation equipment used to serve the customer’s load requirements during periods when utility service is unavailable, provided the emergency generation is not operated in parallel with the integrated electric grid, except on a momentary parallel basis.
After June 30, 2000, to any load served onsite or under an over-the-fence arrangement by any nonmobile self-cogeneration or cogeneration facility.
Further, consistent with state policy, with respect to self-cogeneration or cogeneration deferral agreements, the commission shall do the following:
Provide that a utility shall execute a final self-cogeneration or cogeneration deferral agreement with any customer that, on or before December 20, 1995, had executed a letter of intent (or similar documentation) to enter into the agreement with the utility, provided that the final agreement shall be consistent with the terms and conditions set forth in the letter of intent and the commission shall review and approve the final agreement.
Provide that a customer that holds a self-cogeneration or cogeneration deferral agreement that was in place on or before December 20, 1995, or that was executed pursuant to paragraph (1) in the event the agreement expires, or is terminated, may do any of the following:
Continue through December 31, 2001, to receive utility service at the rate and under terms and conditions applicable to the customer under the deferral agreement that, as executed, includes an allocation of uneconomic costs consistent with subdivision (e) of Section 367.
Construct a self-cogeneration or cogeneration facility of approximately the same capacity as the facility previously deferred, provided that the costs provided in Sections 367, 368, 375, and 376 shall apply consistent with subdivision (e) of Section 367, unless otherwise authorized by the commission pursuant to subdivision (c).
Subject to the firewall described in subdivision (e) of Section 367, provide that the ratemaking treatment for self-cogeneration or cogeneration deferral agreements executed before December 20, 1995, or executed pursuant to paragraph (1) shall be consistent with the ratemaking treatment for the contracts approved before January 1995.
The commission shall authorize, within 60 days of the receipt of a joint application from the serving utility and one or more interested parties, applicability conditions as follows:
For the purposes of this section, all onsite or over-the-fence arrangements shall be consistent with Section 218 as it existed on December 20, 1995.
To facilitate the development of new microcogeneration applications, electrical corporations may apply to the commission for a financing order to finance the transition costs to be recovered from customers employing the applications.
To encourage the continued development, installation, and interconnection of clean and efficient self-generation and cogeneration resources, to improve system reliability for consumers by retaining existing generation and encouraging new generation to connect to the electric grid, and to increase self-sufficiency of consumers of electricity through the deployment of self-generation and cogeneration, both of the following shall occur:
The commission and the Electricity Oversight Board shall determine if any policy or action undertaken by the Independent System Operator, directly or indirectly, unreasonably discourages the connection of existing self-generation or cogeneration or new self-generation or cogeneration to the grid.
If the commission and the Electricity Oversight Board find that any policy or action of the Independent System Operator unreasonably discourages the connection of existing self-generation or cogeneration or new self-generation or cogeneration to the grid, the commission and the Electricity Oversight Board shall undertake all necessary efforts to revise, mitigate, or eliminate that policy or action of the Independent System Operator.
Subject to the fire wall specified in subdivision (e) of Section 367, the provisions of this section and Sections 372 and 374 shall apply in the event the commission authorizes a nonbypassable charge prior to the implementation of an Independent System Operator and Power Exchange referred to in subdivision (a) of Section 365.
One hundred ten megawatts of load served by irrigation districts, as hereafter allocated by this paragraph:
The 110 megawatts of load shall be allocated among the service territories of the three largest electrical corporations in the ratio of the number of irrigation districts in the service territory of each utility to the total number of irrigation districts in the service territories of all three utilities.
The total amount of load allocated to each utility service area shall be phased in over five years beginning January 1, 1997, so that one-fifth of the allocation is allocated in each of the five years. Any allocation that remains unused at the end of any year shall be carried over to the succeeding year and added to the allocation for that year.
The load allocated to each utility service territory pursuant to subparagraph (A) shall be further allocated among the respective irrigation districts within that service territory by the Energy Commission. An individual irrigation district requesting an allocation shall submit to the commission by January 31, 1997, detailed plans that show the load that it serves or will serve and for which it intends to use the allocation within the timeframe requested. These plans shall include specific information on the irrigation districts’ organization for electric distribution, contracts, financing and engineering plans for capital facilities, as well as detailed information about the loads to be served, and shall not be less than eight megawatts or more than 40 megawatts, provided, however, that any portion of the 110 megawatts that remains unallocated may be reallocated to projects without regard to the 40 megawatts limitation. In making an allocation among irrigation districts, the Energy Commission shall assess the viability of each submission and whether it can be accomplished in the timeframe proposed. The Energy Commission shall have the discretion to allocate the load covered by this section in a manner that best ensures its usage within the allocation period.
At least 50 percent of each year’s allocation to a district shall be applied to that portion of load that is used to power pumps for agricultural purposes.
Any load pursuant to this subdivision shall be served by distribution facilities owned by, or leased to, the district in question.
Any load allocated pursuant to this paragraph shall be located within the boundaries of the affected irrigation district, or within the boundaries specified in an applicable service territory boundary agreement between an electrical corporation and the affected irrigation district. The provisions of subparagraph (C) of this paragraph shall be applicable to any load within the County of Stanislaus or San Joaquin, or both, served by any irrigation district that is currently serving or will be serving retail customers.
Seventy-five megawatts of load served by the Merced Irrigation District hereafter prescribed in this paragraph:
The total allocation provided by this paragraph shall be phased in over five years beginning January 1, 1997, so that one-fifth of the allocation is received in each of the five years. Any allocation that remains unused at the end of any year shall be carried over to the succeeding year and added to the allocation for that year.
Any load to which the provision of this paragraph is applicable shall be served by distribution facilities owned by, or leased to, Merced Irrigation District.
A load to which the provisions of this paragraph are applicable shall be located within the boundaries of Merced Irrigation District as those boundaries existed on December 20, 1995, together with the territory of Castle Air Force Base that was located outside of the district on that date.
The total allocation provided by this paragraph shall be phased in over five years beginning January 1, 1997, with the exception of load already being served by the district as of June 1, 1996, which shall be deducted from the total allocation and shall not be subject to the costs provided in Sections 367, 368, 375, and 376.
To loads served by irrigation districts, water districts, water storage districts, municipal utility districts, and other water agencies that, on December 20, 1995, were members of the Southern San Joaquin Valley Power Authority, or the Eastside Power Authority, provided, however, that this paragraph shall be applicable only to that portion of each district or agency’s load that is used to power pumps that are owned by that district or agency as of December 20, 1995, or replacements thereof, and is being used to pump water for district purposes. The rates applicable to these districts and agencies shall be adjusted as of January 1, 1997.
The provisions of this subdivision shall no longer be operative after March 31, 2002.
The provisions of paragraph (1) shall not be applicable to any irrigation district, water district, or water agency described in paragraph (2) or (3).
Transmission services provided to any irrigation district described in paragraph (1) or (2) shall be provided pursuant to otherwise applicable tariffs.
Nothing in this chapter shall be deemed to grant the commission any jurisdiction over irrigation districts not already granted to the commission by existing law.
To give the full effect to the legislative intent in enacting Section 701.8, the costs provided in Sections 367, 368, 375, and 376 shall not apply to the load served by preference power purchased from a federal power marketing agency, or its successor, pursuant to Section 701.8 as it existed on January 1, 1996, provided that the power is used solely for the customer’s own systems load and not for sale. The costs of this provision shall be borne by all ratepayers in the affected service territory, notwithstanding the firewall established in subdivision (e) of Section 367.
To give effect to an existing relationship, the obligation to pay the uneconomic costs specified in Sections 367, 368, 375, and 376 shall not apply to that portion of the load of the University of California campus situated in the County of Yolo that was being served as of May 31, 1996, by preference power purchased from a federal marketing agency, or its successor, provided that the power is used solely for the facility load of that campus and not, directly or indirectly, for sale.
Any electrical corporation serving agricultural customers that have multiple electric meters shall conduct research based on a statistically valid sample of those customers and meters to determine the typical simultaneous peak load of those customers. The results of the research shall be reported to the customers and the commission not later than July 1, 2001. The commission shall consider the research results in setting future electric distribution rates for those customers.
In order to mitigate potential negative impacts on utility personnel directly affected by electric industry restructuring, as described in Decision 95-12-063, as modified by Decision 96-01-009, the commission shall allow the recovery of reasonable employee related transition costs incurred and projected for severance, retraining, early retirement, outplacement and related expenses for the employees.
The costs, including employee related transition costs for employees performing services in connection with Section 363, shall be added to the amount of uneconomic costs allowed to be recovered pursuant to this section and Sections 367, 368, and 376, provided recovery of these employee related transition costs shall extend beyond December 31, 2001, provided recovery of the costs shall not extend beyond December 31, 2006. However, there shall be no recovery for employee related transition costs associated with officers, senior supervisory employees, and professional employees performing predominantly regulatory functions.
To the extent that the costs of programs to accommodate implementation of direct access, the Power Exchange, and the Independent System Operator, that have been funded by an electrical corporation and have been found by the commission or the Federal Energy Regulatory Commission to be recoverable from the utility’s customers, reduce an electrical corporation’s opportunity to recover its utility generation-related plant and regulatory assets by the end of the year 2001, the electrical corporation may recover unrecovered utility generation-related plant and regulatory assets after December 31, 2001, in an amount equal to the utility’s cost of commission-approved or Federal Energy Regulatory Commission approved restructuring-related implementation programs. An electrical corporation’s ability to collect the amounts from retail customers after the year 2001 shall be reduced to the extent the Independent System Operator or the Power Exchange reimburses the electrical corporation for the costs of any of these programs.
The commission shall continue to regulate the facilities for the generation of electricity owned by any public utility prior to January 1, 1997, that are subject to commission regulation until the owner of those facilities has applied to the commission to dispose of those facilities and has been authorized by the commission under Section 851 to undertake that disposal. Notwithstanding any other provision of law, no facility for the generation of electricity owned by a public utility may be disposed of prior to January 1, 2006. The commission shall ensure that public utility generation assets remain dedicated to service for the benefit of California ratepayers.
Section 377 does not apply to the four run-of-river hydroelectric project works located on the Truckee River, as referenced in Section 210(b)(17) of Public Law 101-618 or to the two run-of-river hydroelectric projects, also known as the Naches Drop plant and Naches plant, located on the Wapatox Canal on the Naches River in the State of Washington.
Notwithstanding Section 377, a facility for the generation of electricity, or an interest in a facility for the generation of electricity, that is located outside of this state, is owned by a public utility that serves 60,000 or fewer customer accounts in this state, and is not necessary to serve that public utility’s customers in this state, may be disposed of upon approval of the commission pursuant to Section 851 or upon exemption by the commission pursuant to Section 853.
The commission shall authorize new optional rate schedules and tariffs, including new service offerings, that accurately reflect the loads, locations, conditions of service, cost of service, and market opportunities of customer classes and subclasses.
Notwithstanding any other provision of law, on or before March 7, 2001, the commission, in consultation with the Independent System Operator, shall take all of the following actions, and shall include the reasonable costs involved in taking those actions in the distribution revenue requirements of utilities regulated by the commission, as appropriate:
Identify and undertake those actions necessary to reduce or remove constraints on the state’s existing electrical transmission and distribution system, including, but not limited to, reconductoring of transmission lines, the addition of capacitors to increase voltage, the reinforcement of existing transmission capacity, and the installation of new transformer banks. The commission shall, in consultation with the Independent System Operator, give first priority to those geographical regions where congestion reduces or impedes electrical transmission and supply.
Consistent with the existing statutory authority of the commission, afford electrical corporations a reasonable opportunity to fully recover costs it determines are reasonable and prudent to plan, finance, construct, operate, and maintain any facilities under its jurisdiction required by this section.
In consultation with the Energy Commission, adopt energy conservation demand-side management and other initiatives in order to reduce demand for electricity and reduce load during peak demand periods. Those initiatives shall include, but not be limited to, all of the following:
Expansion and acceleration of residential and commercial weatherization programs.
Expansion and acceleration of programs to inspect and improve the operating efficiency of heating, ventilation, and air-conditioning equipment in new and existing buildings, to ensure that these systems achieve the maximum feasible cost-effective energy efficiency.
Expansion and acceleration of programs to improve energy efficiency in new buildings, in order to achieve the maximum feasible reductions in uneconomic energy and peak electricity consumption.
Incentives to equip commercial buildings with the capacity to automatically shut down or dim nonessential lighting and incrementally raise thermostats during a peak electricity demand period.
Evaluation of installing local infrastructure to link temperature setback thermostats to real-time price signals.
Incentives for load control and distributed generation to be paid for enhancing reliability.
Differential incentives for renewable or super clean distributed generation resources pursuant to Section 379.6.
Reevaluation of all efficiency cost-effectiveness tests in light of increases in wholesale electricity costs and of natural gas costs to explicitly include the system value of reduced load on reducing market clearing prices and volatility.
In consultation with the Energy Commission, adopt and implement a residential, commercial, and industrial peak reduction program that encourages electric customers to reduce electricity consumption during peak power periods.
It is the intent of the Legislature that the self-generation incentive program increase deployment of distributed generation and energy storage systems to facilitate the integration of those resources into the electrical grid, improve efficiency and reliability of the distribution and transmission system, and reduce emissions of greenhouse gases, peak demand, and ratepayer costs. It is the further intent of the Legislature that the commission, in future proceedings, provide for an equitable distribution of the costs and benefits of the program.
The commission, in consultation with the Energy Commission, may authorize the annual collection of not more than double the amount authorized for the self-generation incentive program in the 2008 calendar year, through December 31, 2024. The commission shall require the administration of the program for distributed energy resources originally established pursuant to Chapter 329 of the Statutes of 2000 until January 1, 2026. On January 1, 2026, the commission shall provide repayment of all unallocated funds collected pursuant to this section to reduce ratepayer costs.
Eligibility for incentives under the self-generation incentive program that are funded through the annual collection authorized pursuant to paragraph (2) of subdivision (a) shall be limited to distributed energy resources that the commission, in consultation with the State Air Resources Board, determines will achieve reductions in emissions of greenhouse gases pursuant to the California Global Warming Solutions Act of 2006 (Division 25.5 (commencing with Section 38500) of the Health and Safety Code).
On or before July 1, 2015, the commission shall update the factor for avoided greenhouse gas emissions based on both the most recent data available to the State Air Resources Board for greenhouse gas emissions from electricity sales in the self-generation incentive program administrators’ service areas and current estimates of greenhouse gas emissions over the useful life of the distributed energy resource, including consideration of the effects of the California Renewables Portfolio Standard.
The commission shall adopt requirements for energy storage systems to ensure that eligible energy storage systems reduce the emissions of greenhouse gases.
Eligibility for the funding of any combustion-operated distributed generation projects using fossil fuel is subject to all of the following conditions:
Notwithstanding paragraph (1), a project that does not meet the applicable NOx emissions standard is eligible if it meets both of the following requirements:
The project operates solely on waste gas. The commission shall require a customer that applies for an incentive pursuant to this paragraph to provide an affidavit or other form of proof that specifies that the project shall be operated solely on waste gas. Incentives awarded pursuant to this paragraph shall be subject to refund and shall be refunded by the recipient to the extent the project does not operate on waste gas. As used in this paragraph, “waste gas” means natural gas that is generated as a byproduct of petroleum production operations and is not eligible for delivery to the utility pipeline system.
The air quality management district or air pollution control district, in issuing a permit to operate the project, determines that operation of the project will produce an onsite net air emissions benefit compared to permitted onsite emissions if the project does not operate. The commission shall require the customer to secure the permit before receiving incentives.
In determining the eligibility for the self-generation incentive program, minimum system efficiency shall be determined either by calculating electrical and process heat efficiency as set forth in Section 216.6, or by calculating overall electrical efficiency.
Eligibility for incentives under the self-generation incentive program shall be limited to distributed energy resource technologies that the commission determines meet all of the following requirements:
The distributed energy resource technology shifts onsite energy use to off-peak time periods or reduces demand from the grid by offsetting some or all of the customer’s onsite energy load, including, but not limited to, net peak electric load.
The distributed energy resource technology is commercially available.
The distributed energy resource technology safely uses the existing transmission and distribution system.
The distributed energy resource technology improves air quality by reducing criteria air pollutants.
Recipients of the self-generation incentive program funds shall provide relevant data to the commission and the State Air Resources Board, upon request, and shall be subject to onsite inspection to verify equipment operation and performance, including capacity, thermal output, and usage to verify criteria air pollutant and greenhouse gas emissions performance.
In administering the self-generation incentive program, the commission shall determine a capacity factor for each distributed generation system energy resource technology in the program.
In administering the self-generation incentive program, the commission may adjust the amount of incentives and evaluate other public policy interests, including, but not limited to, ratepayers, energy efficiency, peak load reduction, load management, and environmental interests.
The commission shall consider the relative amount and the cost of greenhouse gas emissions reductions, peak demand reductions, system reliability benefits, and other measurable factors when allocating program funds between eligible technologies.
The commission shall ensure that distributed generation resources are made available in the self-generation incentive program for all ratepayers.
In administering the self-generation incentive program, the commission shall provide an additional incentive of 20 percent from existing program funds for the installation of eligible distributed generation resources manufactured in California.
The costs of the self-generation incentive program shall not be recovered from customers participating in the California Alternate Rates for Energy (CARE) program.
The commission shall evaluate the overall success and impact of the self-generation incentive program based on the following performance measures:
The amount of reductions of emissions of greenhouse gases.
The amount of reductions of emissions of criteria air pollutants measured in terms of avoided emissions and reductions of criteria air pollutants represented by emissions credits secured for project approval.
The amount of energy reductions measured in energy value.
The amount of reductions of customer peak demand.
The ratio of the electricity generated by distributed energy resource generation projects receiving incentives from the self-generation incentive program to the electricity capable of being produced by those projects, commonly known as a capacity factor.
The value to the electrical transmission and distribution system measured in avoided costs of transmission and distribution upgrades and replacement.
The ability to improve onsite electricity reliability as compared to onsite electricity reliability before the self-generation incentive program technology was placed in service.
On and after January 1, 2020, generation technologies using nonrenewable fuels shall not be eligible for incentives under the self-generation incentive program.
As used in this section, “advanced electrical distributed generation technology” means any electrical distributed generation technology that generates useful electricity and meets all of the following conditions:
The emissions standards adopted by the State Air Resources Board pursuant to the distributed generation certification program requirements of Article 3 (commencing with Section 94200) of Subchapter 8 of Chapter 1 of Division 3 of Title 17 of the California Code of Regulations.
Produces de minimis emissions of sulfur oxides and nitrogen oxides.
Meets the greenhouse gases emission performance standard established by the commission pursuant to Section 8341.
Has a total electrical efficiency of not less than 45 percent. If legislation is enacted that increases the 42.5 percent efficiency described in subdivision (b) of Section 216.6 above 45 percent, the commission may adjust the electrical efficiency standard described in this paragraph to ensure that this electrical efficiency standard meets or exceeds the standard enacted for the purposes of subdivision (b) of Section 216.6.
Is sized to meet the generator’s onsite electrical demand.
Has parallel operation to the electrical distribution grid.
Utilizes renewable or nonrenewable fuel.
An advanced electrical distributed generation technology shall qualify for the rate established by the commission pursuant to Section 454.4.
The limitation in subdivision (b) of Section 6352 upon the assessment of surcharges for gas used to generate electricity by a nonutility facility applies to an advanced electrical distributed generation technology.
The limitation in Section 2773.5 upon imposing alternative fuel capability requirements upon gas customers that use gas for purposes of cogeneration applies to an advanced electrical distributed generation technology.
The commission or State Air Resources Board may, in furtherance of the state’s goals for achieving cost-effective reductions in emissions of greenhouse gases, meeting resource adequacy requirements, or meeting the renewables portfolio standard, treat advanced electrical distributed generation technology as cogeneration.
Subdivisions (b) and (c) do not apply to an advanced electrical distributed generation technology that is first operational at a site on and after January 1, 2016.
In administering the self-generation incentive program pursuant to Section 379.6, the commission shall allocate at least 10 percent of the annual collection for the program in the 2020 calendar year for the installation of energy storage and other eligible distributed energy resources as determined by the commission pursuant to paragraph (1) of subdivision (b) of Section 379.6 for customers that operate a critical facility or critical infrastructure serving communities in high fire threat districts to support resiliency during a deenergization event. Eligible customers may include, but are not limited to, emergency responders, emergency operations centers, emergency shelters, water suppliers, wastewater agencies, fire stations, and police stations.
In allocating funds pursuant to subdivision (a), the commission shall do all of the following:
Adjust the rules of the self-generation incentive program, if necessary, for the amount allocated pursuant to subdivision (a) to allow for the use of backup power when electricity is shut off due to wildfire risk.
Prioritize funding to projects for eligible customers that do all of the following:
Demonstrate a financial need.
Operate a critical facility or critical infrastructure serving communities in high fire threat districts during a deenergization event.
Demonstrate coordination with the electrical corporation serving the customer’s community, relevant local governments, and the Office of Emergency Services for emergency and disaster planning and preparedness.
Ensure that customers receiving funding pursuant to subdivision (a) are informed of the potential limitations of the energy storage and distributed energy resources system to provide reliable backup power, particularly for unplanned and extended loss of power.
Include an evaluation of the performance and impact of the projects funded pursuant to subdivision (a) in a relevant self-generation incentive program evaluation report no later than December 31, 2022. The evaluation shall include a list of customers receiving funding and the type of customer operating each project. For a representative sampling of projects, the evaluation shall also include the known and expected performance of each project as a source of backup power; the impact of the project on greenhouse gas emissions; the communities served by the critical facility or critical infrastructure; customer coordination with the Office of Emergency Services, the electrical corporation serving the community, and relevant local governments; and any other information the commission deems useful.
The commission may prioritize funding for additional customers located in high fire threat districts and may continue to prioritize self-generation incentive program funding for customers that operate critical facilities or critical infrastructure serving communities in high fire threat districts in subsequent years.
Nothing in this section shall be interpreted to allow for the use of incentives from the self-generation incentive program for generation technologies using nonrenewable fuels on or after January 1, 2020.
In administering the self-generation incentive program pursuant to Section 379.6, the commission shall use funds appropriated by the Legislature for the purpose of providing incentives to eligible low-income residential customers, including those receiving service from a local publicly owned electric utility, as defined pursuant to Section 224.3, who install behind-the-meter energy storage systems or solar photovoltaic systems paired with energy storage systems, as an integrated approach to increase individual customer resiliency, to reduce the electrical grid’s net peak demand, to reduce electric ratepayer costs, and to reduce emissions of greenhouse gases and localized air pollution.
The commission shall consider requiring customers installing solar photovoltaic systems paired with energy storage systems or new energy storage systems under this section and served on a standard contract or tariff pursuant Section 2827.1 to participate in a demand response or peak load reduction program offered through the customer’s load-serving entity, including market-integrated supply-side demand response programs, to reduce net peak demand.
The commission, in consultation with the Independent System Operator, shall establish resource adequacy requirements for all load-serving entities.
In establishing resource adequacy requirements, the commission shall ensure the reliability of electrical service in California while advancing, to the extent possible, the state’s goals for clean energy, reducing air pollution, and reducing emissions of greenhouse gases. The resource adequacy program shall achieve all of the following objectives:
Facilitate the development of new generating, nongenerating, and hybrid capacity and the retention of existing generating, nongenerating, and hybrid capacity that is economical and needed for reliability and to achieve the state policy specified in Section 454.53.
Establish new, or maintain existing, demand response products and tariffs that facilitate the economical dispatch and use of demand response that can either meet or reduce an electrical corporation’s resource adequacy requirements, as determined by the commission.
Equitably allocate the cost of generating capacity and demand response in a manner that prevents the shifting of costs between customer classes.
Minimize enforcement requirements and costs.
Consideration of mitigation measures, if the commission determines they are needed, to reduce costs to ratepayers.
Maximize the ability of community choice aggregators to determine the generation resources used to serve their customers.
Each load-serving entity shall maintain physical generating capacity and electrical demand response adequate to meet its load requirements, including, but not limited to, peak demand and planning and operating reserves. The generating capacity or electrical demand response shall be deliverable to locations and at times as may be necessary to maintain electrical service system reliability, local area reliability, and flexibility.
Each load-serving entity shall, at a minimum, meet the most recent minimum planning reserve and reliability criteria approved by the board of directors of the Western Systems Coordinating Council or the Western Electricity Coordinating Council.
The commission shall implement and enforce the resource adequacy requirements established in accordance with this section in a nondiscriminatory manner. Each load-serving entity shall be subject to the same requirements for resource adequacy, the renewables portfolio standard program, and the integrated resource planning process pursuant to Section 454.52 that apply to electrical corporations pursuant to this section, or are otherwise required by law or by order or decision of the commission. The commission shall exercise its enforcement powers to ensure compliance by all load-serving entities.
The commission shall require sufficient information, including, but not limited to, anticipated load, actual load, and measures undertaken by a load-serving entity to ensure resource adequacy, to be reported to enable the commission to determine compliance with the resource adequacy requirements established by the commission.
The commission shall calculate and publish annually on its internet website, in a new report or as part of another report, the percentage of each load-serving entity’s local and system resource adequacy requirements from the previous calendar year that was met with capacity from eligible renewable energy resources pursuant to the California Renewables Portfolio Standard Program (Article 16 (commencing with Section 399.11)), other zero-carbon resources, including large hydroelectric and nuclear resources, or energy storage resources. In determining the percentage of each load-serving entity’s resource adequacy requirements, the commission shall include all directly owned or contracted resources and each load-serving entity’s allocation of any centrally procured resources or allocation of resources pursuant to any other mechanism that involves an assignment or allocation of resources purchased or owned by a single buyer, and shall exclude any share of a load-serving entity’s resources that were allocated to another load-serving entity.
An electrical corporation’s costs of meeting or reducing resource adequacy requirements, including, but not limited to, the costs associated with system reliability, local area reliability, or flexible resource adequacy, that are determined to be reasonable by the commission, or are otherwise recoverable under a procurement plan approved by the commission pursuant to Section 454.5, shall be fully recoverable from those customers on whose behalf the costs are incurred, as determined by the commission, at the time the commitment to incur the cost is made, on a fully nonbypassable basis, as determined by the commission. The commission shall exclude any amounts authorized to be recovered pursuant to Section 366.2 when authorizing the amount of costs to be recovered from customers of a community choice aggregator or from customers that purchase electricity through a direct transaction pursuant to this subdivision.
The commission shall determine and authorize the most efficient and equitable means for achieving all of the following:
Meeting the objectives of this section.
Ensuring that investment is made in new generating capacity.
Ensuring that existing generating capacity that is economical is retained to ensure reliability.
Ensuring that the resource adequacy program can reasonably maintain a standard measure of reliability, such as a one-day-in-10-year loss-of-load expectation or a similarly robust reliability metric adopted by the commission, and use it for planning purposes.
Ensuring that the cost of generating capacity and demand response is allocated equitably.
Ensuring that community choice aggregators can determine the generation resources used to serve their customers.
Ensuring that investments are made in new and existing demand response resources that are cost effective and help to achieve electrical grid reliability and the state’s goals for reducing emissions of greenhouse gases.
Minimizing the need for backstop procurement by the Independent System Operator.
In making the determination pursuant to subdivision (h), the commission may consider a centralized resource adequacy mechanism among other options.
The commission shall ensure appropriate valuation of both supply and load modifying demand response resources. The commission, in an existing or new proceeding, shall establish a mechanism to value load modifying demand response resources, including, but not limited to, the ability of demand response resources to help meet distribution needs and transmission system needs and to help reduce a load-serving entity’s resource adequacy obligation pursuant to this section. In determining this value, the commission shall consider how these resources further the state’s electrical grid reliability and the state’s goals for reducing emissions of greenhouse gases. The commission, Energy Commission, and Independent System Operator shall coordinate to jointly ensure that changes in demand caused by load modifying demand response are expeditiously and comprehensively reflected in the Energy Commission’s Integrated Energy Policy Report forecast and in planning proceedings and associated analyses, and shall encourage reflection of these changes in demand in the operation of the grid.
For purposes of this section, “load-serving entity” means an electrical corporation, electric service provider, or community choice aggregator. “Load-serving entity” does not include any of the following:
A local publicly owned electric utility.
The State Water Resources Development System commonly known as the State Water Project.
Customer generation located on the customer’s site or providing electric service through arrangements authorized by Section 218, if the customer generation, or the load it serves, meets one of the following criteria:
It takes standby service from the electrical corporation on a commission-approved rate schedule that provides for adequate backup planning and operating reserves for the standby customer class.
It is not physically interconnected to the electrical transmission or distribution grid, so that, if the customer generation fails, backup electricity is not supplied from the electrical grid.
There is physical assurance that the load served by the customer generation will be curtailed concurrently and commensurately with an outage of the customer generation.
In establishing a demand response program, the commission shall do all of the following:
Establish rules consistent with state and federal law for how and when back-up generation may be used within the program and establish reporting and data collection requirements to verify compliance with those rules.
Ensure the program approved for resource adequacy requirements delivers the expected results and provides ratepayer benefits.
Before the implementation of a program for residential customers, establish customer protection rules regarding the participation, cost of participation, and ability to not enroll in the program. A residential customer who does not enroll in the program shall lose eligibility for rebates, discounts, and other incentives offered to customers who participate in the program. The commission shall prohibit the imposition of charges on a residential customer for not enrolling in the program.
Establish a method to accurately calculate the customer’s load shift at time intervals in which the customer would be eligible for demand response program payments or credits.
Establish metering and monitoring policies for the program.
This section does not apply to time-variant pricing as defined in Section 745, including time-of-use rates, critical peak pricing, and real-time pricing, or to similar tariffs, including peak time rebates.
ARTICLE 7. Research, Environmental, and Low-Income Funds [381. - 384.5.]
To ensure that the funding for the programs described in subdivision (b) and Section 382 are not commingled with other revenues, the commission shall require each electrical corporation to identify a separate rate component to collect the revenues used to fund these programs. The rate component shall be a nonbypassable element of the local distribution service.
The commission shall allocate funds collected pursuant to subdivision (a), and any interest earned on collected funds, to programs that enhance system reliability and provide in-state benefits as follows:
Cost-effective energy efficiency and conservation activities.
Public interest research and development not adequately provided by competitive and regulated markets.
In-state operation and development of existing and new and emerging eligible renewable energy resources, as defined in Section 399.12.
The commission shall order the respective electrical corporations to collect and spend these funds at the levels and for the purposes required in Section 399.8.
Each electrical corporation shall allow customers to make voluntary contributions through their utility bill payments as either a fixed amount or a variable amount to support programs established pursuant to paragraph (3) of subdivision (b). Funds collected by electrical corporations for these purposes shall be forwarded in a timely manner to the appropriate fund as specified by the commission.
No later than July 15, 2003, the commission shall establish policies and procedures by which any party, including, but not limited to, a local entity that establishes a community choice aggregation program, may apply to become administrators for cost-effective energy efficiency and conservation programs established pursuant to Section 381. In determining whether to approve an application to become administrators and subject to an aggregator’s right to elect to become an administrator pursuant to subdivision (f), the commission shall consider the value of program continuity and planning certainty and the value of allowing competitive opportunities for potentially new administrators. The commission shall weigh the benefits of the party’s proposed program to ensure that the program meets the following objectives:
Is consistent with the goals of the existing programs established pursuant to Section 381.
Advances the public interest in maximizing cost-effective electricity savings and related benefits.
Accommodates the need for broader statewide or regional programs.
All audit and reporting requirements established by the commission pursuant to Section 381 and other statutes shall apply to the parties chosen as administrators under this section.
If a community choice aggregator is not the administrator of energy efficiency and conservation programs for which its customers are eligible, the commission shall require the administrator of cost-effective energy efficiency and conservation programs to direct a proportional share of its approved energy efficiency program activities for which the community choice aggregator’s customers are eligible, to the community choice aggregator’s territory without regard to customer class. To the extent that energy efficiency and conservation programs are targeted to specific locations to avoid or defer transmission or distribution system upgrades, the targeted expenditures shall continue irrespective of whether the loads in those locations are served by an aggregator or by an electrical corporation. The commission shall also direct the administrator to work with the community choice aggregator, to provide advance information where appropriate about the likely impacts of energy efficiency programs and to accommodate any unique community program needs by placing more, or less, emphasis on particular approved programs to the extent that these special shifts in emphasis in no way diminish the effectiveness of broader statewide or regional programs. If the community choice aggregator proposes energy efficiency programs other than programs already approved for implementation in its territory, it shall do so under established commission policies and procedures. The commission may order an adjustment to the share of energy efficiency program activities directed to a community choice aggregator’s territory if necessary to ensure an equitable and cost-effective allocation of energy efficiency program activities.
The commission shall establish an impartial process for making the determination of whether a third party, including a community choice aggregator, may become administrators for cost-effective energy efficiency and conservation programs pursuant to subdivision (a), and shall not delegate or otherwise transfer the commission’s authority to make this determination for a community choice aggregator to an electrical corporation.
The impartial process established by the commission shall allow a registered community choice aggregator to elect to become the administrator of funds collected from the aggregator’s electric service customers and collected through a nonbypassable charge authorized by the commission, for cost-effective energy efficiency and conservation programs, except those funds collected for broader statewide and regional programs authorized by the commission.
A community choice aggregator electing to become an administrator shall submit a plan, approved by its governing board, to the commission for the administration of cost-effective energy efficiency and conservation programs for the aggregator’s electric service customers that includes funding requirements, a program description, a cost-effectiveness analysis, and the duration of the program. The commission shall certify that the plan submitted does all of the following:
Is consistent with the goals of the programs established pursuant to this section and Section 399.4.
Advances the public interest in maximizing cost-effective electricity savings and related benefits.
Accommodates the need for broader statewide or regional programs.
Includes audit and reporting requirements consistent with the audit and reporting requirements established by the commission pursuant to this section.
Includes evaluation, measurement, and verification protocols established by the community choice aggregator.
Includes performance metrics regarding the community choice aggregator’s achievement of the objectives listed in paragraphs (1) to (5), inclusive, and in any previous plan.
If the commission does not certify the plan for the administration of cost-effective energy efficiency and conservation programs submitted by a community choice aggregator pursuant to subdivision (f), the community choice aggregator electing to administer these programs may submit an amended plan to the commission for certification. No moneys may be released to a community choice aggregator unless the commission certifies the plan pursuant to subdivision (f).
The commission shall investigate the ability of electrical corporations and gas corporations to provide various energy efficiency financing options to their customers for the purposes of implementing the program developed pursuant to Section 25943 of the Public Resources Code.
It is the intent of the Legislature that the commission implement this section by establishing applicable rules, within a reasonable period of time and in an open process, that are clear and operate on a prospective basis.
Recognizing the already underway 2015 commission work to adopt efficiency potential and goals, the Energy Commission work on its 2015 energy demand forecast, and the need to determine how to incorporate meter-based performance into determinations of goals, portfolio cost-effectiveness, and authorized budgets, the commission, in a separate or existing proceeding, shall, by September 1, 2016, authorize electrical corporations or gas corporations to provide financial incentives, rebates, technical assistance, and support to their customers to increase the energy efficiency of existing buildings based on all estimated energy savings and energy usage reductions, taking into consideration the overall reduction in normalized metered energy consumption as a measure of energy savings. Those programs shall include energy usage reductions resulting from the adoption of a measure or installation of equipment required for modifications to existing buildings to bring them into conformity with, or to cause them to exceed, the requirements of Title 24 of the California Code of Regulations, as well as operational, behavioral, and retrocommissioning activities reasonably expected to produce multiyear savings. The commission shall authorize an electrical corporation or gas corporation to count all energy savings achieved through the authorized programs created by this subdivision, unless determined otherwise, toward overall energy efficiency goals or targets established by the commission. The commission may adjust the energy efficiency goals or targets of an electrical corporation or gas corporation to reflect this change in savings estimation consistent with this subdivision and subdivision (d).
Effective January 1, 2016, electrical corporations and gas corporations are authorized to implement the provisions of subdivision (b) for high opportunity projects or programs. The commission shall provide expedited authorization of high opportunity projects and programs to apply the savings baseline provisions in subdivision (b).
In furtherance of subdivision (b), the commission, in consultation with the Energy Commission, shall consider all of the following:
The results of any interagency baseline assessment.
Any available results from electrical corporation and gas corporation baseline pilot studies ordered in commission Decision 14-10-046 (October 24, 2014), Decision Establishing Energy Efficiency Savings Goals and Approving 2015 Energy Efficiency Programs and Budgets.
Information necessary to ensure consistency with the energy forecast and planning functions of the Energy Commission and the Independent System Operator.
The commission may direct electrical corporations and gas corporations to make filings that are necessary to ensure coordination with the energy forecast and planning functions of the Energy Commission and the Independent System Operator.
This subdivision imposes the operative requirements pursuant to this section for custom projects and other custom programs for industrial, agricultural, commercial, residential, and public sector customers. This subdivision shall become operative on July 1, 2019, and applies only to those programs and projects.
The commission shall authorize electrical corporations and gas corporations to provide financial incentives, rebates, technical assistance, and support to their customers to increase the energy efficiency of industrial, agricultural, commercial, residential, and public sector customers based on nationally recognized measurement and verification standards, such as the International Performance Measurement and Verification Protocol.
All energy savings achieved through the programs authorized pursuant to this subdivision shall count toward the overall energy efficiency goals or targets established by the commission for an electrical corporation, gas corporation, or program administrator.
The commission may adjust the energy efficiency goals or targets of an electrical corporation or gas corporation to reflect a change in the forecast energy savings consistent with this subdivision and subdivision (d).
The commission shall develop and maintain rules for custom energy efficiency projects that include eligibility criteria and other metrics for determining whether a project is eligible for funding pursuant to the program.
The commission shall review and circulate for public review and comment statewide eligibility criteria or metrics at least 30 days prior to changes, including posting on the commission’s internet website.
After the initial 30-day period for public review and comment, any changes to the initial proposed eligibility criteria or metrics shall be circulated for public review for not less than 15 days prior to final adoption.
Once eligibility criteria or metrics are adopted, any proposed revision shall be circulated for public review and comment for not less than 30 days prior to a revision. For these purposes, grammatical corrections or other nonsubstantive modifications are not a revision and may be made when the need for the correction or modification is discovered.
Statewide eligibility criteria or metrics shall operate only on a prospective basis, shall be applied uniformly and consistently by each electrical corporation and gas corporation, and shall not be applied retroactively to any pending or approved applications.
Any delay in the adoption of eligibility criteria or metrics past July 1, 2019, shall not be the basis for denial of any application nor a basis to suspend the program.
The rules adopted by the commission for custom energy efficiency projects shall require each electrical corporation and gas corporation to maintain a custom measure project archive. The commission shall develop and maintain requirements for what information is to be included in the custom measure project archive, including information required to support the applications of customers’ custom energy efficiency projects.
Upon being notified of the filing of a new application, or that a proposed project has moved from the preapplication stage to the application stage, the commission shall make a determination of whether the application has been selected for review within 15 days and notify the electrical corporation or gas corporation of its decision to review.
The electrical corporation or gas corporation shall make the project application supporting documentation available to the commission for review within 15 business days of the commission review selection date. The commission shall develop and maintain requirements for what information is to be included in the custom measure project archive for those customer projects selected for review.
The commission shall, within 15 days of the submission of a project to the custom measure project archive, promptly notify an electrical corporation or gas corporation of any deficiency in the information supporting an application.
The review of a proposed project shall be concluded within 30 business days from when the date a project’s documentation is received by the commission, unless the commission determines it was provided incomplete or inaccurate supporting information from the electrical corporation or gas corporation, and notifies the electrical corporation and gas corporation of the need for additional review time. The 30 business days will restart from the time complete and accurate documentation, as noted in the notification of deficiencies, is submitted by the electrical corporation or gas corporation. The electrical corporation or gas corporation shall notify the customer applicant within 48 hours of any delays as a result of incomplete or inaccurate supporting project information, or if the commission needs additional review time.
The commission shall notify the electrical corporation or gas corporation of the specific deficiencies in the information supporting an application, including each basis as to why the project is inconsistent with the eligibility criteria and metrics, which may include failure to adequately define the project, make specific recommendations for the conditions under which the project would be approved, and, if the application fails to adequately define the project, identify aspects of the project that require further definition.
If, as a result of the review, the commission rejects the proposed project or requests modification of the project, the commission shall notify the electrical corporation or gas corporation of the reasons for the rejection or request for modification, including each basis as to why the project is rejected or modification is requested, and make specific recommendations for the conditions under which the project would be approved. The electrical corporation or gas corporation shall promptly inform the applicant as to the reasons why the project was rejected and the specific recommendations for the conditions under which the project would be approved.
The commission shall not reject a proposed project or request modification of a project on the basis of inconsistency with eligibility criteria or metrics that were not in effect at the time the project application was submitted.
If any party to the project is unsatisfied with the commission’s directions for the project, a dispute resolution process may be initiated by that party. The commission shall adopt rules for the conduct of the dispute resolution process.
If a project is not selected by the commission for review within the period determined pursuant to subparagraph (B), or if a project has not received written direction from the commission within the period specified in clause (iv) of subparagraph (B), the commission shall be deemed to have waived review of the project and the project may proceed as if it had been approved by the commission, but the project is subject to the review of the electrical or gas corporation.
For projects that were not reviewed and did not receive written documentation, as specified in subparagraph (G) of paragraph (3), an electrical corporation or gas corporation may rely on its project application review process to determine the forecast energy savings values for the project based on rules adopted by the commission, and base the final customer incentive payment and contractor pay-for-performance payment on postinstallation measurement and verification results.
The commission may employ postinstallation review of a project to determine if the project was carried out consistent with the application and to obtain information pertaining to whether the eligibility criteria or metrics should be revised.
Except as described in paragraph (2), this subdivision does not limit the commission’s existing authority to evaluate projects or programs for the purpose of prospectively adjusting the projects or programs for industrial and agricultural processes, facilities, systems, and equipment.
The commission shall require an electrical or gas corporation to revise a ratepayer-funded energy efficiency program identified pursuant to Section 913.9 as necessary to ensure that the program complements and does not duplicate a program administered by a state agency.
It is the intent of the Legislature to protect and strengthen the current network of community service providers by doing the following:
Directing that any evaluation of the effectiveness of the low-income energy efficiency programs shall be based not solely on cost criteria, but also on the degree to which the provision of services allows maximum program accessibility to quality programs to low-income communities by entities that have demonstrated performance in effectively delivering services to the communities.
Ensuring that high quality, low-income energy efficiency programs are delivered to the maximum number of eligible participants at a reasonable cost.
Programs provided to low-income electricity customers, including, but not limited to, targeted energy-efficiency services and the California Alternate Rates for Energy program shall be funded at not less than 1996 authorized levels based on an assessment of customer need.
In order to meet legitimate needs of electric and gas customers who are unable to pay their electric and gas bills and who satisfy eligibility criteria for assistance, recognizing that electricity is a basic necessity, and that all residents of the state should be able to afford essential electricity and gas supplies, the commission shall ensure that low-income ratepayers are not jeopardized or overburdened by monthly energy expenditures. Energy expenditure may be reduced through the establishment of different rates for low-income ratepayers, different levels of rate assistance, and energy efficiency programs.
Nothing in this section shall be construed to prohibit electric and gas providers from offering any special rate or program for low-income ratepayers that is not specifically required in this section.
Beginning in 2002, an assessment of the needs of low-income electricity and gas ratepayers shall be conducted periodically by the commission with the assistance of the Low-Income Oversight Board. A periodic assessment shall be made not less often than every third year. The assessment shall evaluate low-income program implementation and the effectiveness of weatherization services and energy efficiency measures in low-income households. The assessment shall consider whether existing programs adequately address low-income electricity and gas customers’ energy expenditures, hardship, language needs, and economic burdens.
The commission shall, by not later than December 31, 2020, ensure that all eligible low-income electricity and gas customers are given the opportunity to participate in low-income energy efficiency programs, including customers occupying apartments or similar multiunit residential structures. The commission and electrical corporations and gas corporations shall make all reasonable efforts to coordinate ratepayer-funded programs with other energy conservation and efficiency programs and to obtain additional federal funding to support actions undertaken pursuant to this subdivision.
These programs shall be designed to provide long-term reductions in energy consumption at the dwelling unit based on an audit or assessment of the dwelling unit, and may include improved insulation, energy efficient appliances, measures that utilize solar energy, and other improvements to the physical structure.
The commission shall allocate funds necessary to meet the low-income objectives in this section.
There is hereby established a Low-Income Oversight Board that shall advise the commission on low-income electric, gas, and water customer issues and shall serve as a liaison for the commission to low-income ratepayers and representatives. The Low-Income Oversight Board shall replace the Low-Income Advisory Board in existence on January 1, 2000. The Low-Income Oversight Board shall do all of the following to advise the commission regarding the commission’s duties:
Monitor and evaluate implementation of all programs provided to low-income electricity, gas, and water customers.
Assist in the development and analysis of any assessments of low-income customer need.
Encourage collaboration between state and utility programs for low-income electricity and gas customers to maximize the leverage of state and federal energy efficiency funds to both lower the bills and increase the comfort of low-income customers.
Provide reports to the Legislature, as requested, summarizing the assessment of need, audits, and analysis of program implementation.
Assist in streamlining the application and enrollment process of programs for low-income electricity and gas customers with general low-income programs, including, but not limited to, the Universal Lifeline Telephone Service (ULTS) program and, including compliance with Section 739.1.
Encourage the usage of the network of community service providers in accordance with Section 381.5.
The Low-Income Oversight Board shall be comprised of 11 members to be selected as follows:
Five members selected by the commission who have expertise in the low-income community and who are not affiliated with any state agency or utility group. These members shall be selected in a manner to ensure an equitable geographic distribution.
One member selected by the Governor.
One member selected by the commission who is a commissioner or commissioner designee.
One member selected by the Department of Community Services and Development.
One member selected by the commission who is a representative of private weatherization contractors.
One member selected by the commission who is a representative of an electrical or gas corporation.
One member selected by the commission who is a representative of a water corporation.
The Low-Income Oversight Board shall alternate meeting locations between northern, central, and southern California.
The Low-Income Oversight Board may establish a technical advisory committee consisting of low-income service providers, utility representatives, consumer organizations, and commission staff, to assist the board and may request utility representatives and commission staff to assist the technical advisory committee.
The commission shall do all of the following in conjunction with the board:
Work with the board, interested parties, and community-based organizations to increase participation in programs for low-income customers.
Provide technical support to the board.
Ensure that the energy burden of low-income electricity and gas customers is reduced.
Provide formal notice of board meetings in the commission’s daily calendar.
Members of the board and members of the technical advisory committee shall be eligible for compensation in accordance with state guidelines for necessary travel.
Members of the board and members of the technical advisory committee who are not salaried state service employees shall be eligible for reasonable compensation for attendance at board meetings.
All reasonable costs incurred by the board in carrying out its duties pursuant to subdivision (a), including staffing, travel, and administrative costs, shall be reimbursed through the public utilities reimbursement account and shall be part of the budget of the commission and the commission shall consult with the board in the preparation of that portion of the commission’s annual proposed budget.
Funds transferred to the Energy Commission pursuant to this article for purposes of public interest research, development, and demonstration shall be transferred to the Public Interest Research, Development, and Demonstration Fund, which is hereby created in the State Treasury. The fund is a trust fund and shall contain money from all interest, repayments, disencumbrances, royalties, and any other proceeds appropriated, transferred, or otherwise received for purposes pertaining to public interest research, development, and demonstration. Any appropriations that are made from the fund shall have an encumbrance period of not longer than two years, and a liquidation period of not longer than four years.
Funds deposited in the Public Interest Research, Development, and Demonstration Fund may be expended for projects that serve the energy needs of both stationary and transportation purposes if the research provides an electricity ratepayer benefit.
The Energy Commission shall report annually to the appropriate budget committees of the Legislature on any encumbrances or liquidations that are outstanding at the time the commission’s budget is submitted to the Legislature for review.
On or before March 1, 2014, the commission shall order electrical corporations to submit, on or before July 1, 2015, a tariff to be used, at the discretion of local governments, to fund energy efficiency improvements in street light poles owned by the electrical corporations to ensure reduced energy consumption for local governments who are streetlight customers covered by these tariffs.
The tariff shall be designed to allow local governments to remit the cost of the improvement through the tariff over time, resulting in reduced energy consumption, without shifting costs to nonparticipating ratepayers. The cost of the improvement shall be identified separately rather than included within the charge for electrical service.
Notwithstanding subdivision (b), the improvement performed pursuant to the tariff submitted under subdivision (a) shall be eligible for any rebate or incentives available through ratepayer-funded programs intended to increase energy efficiency.
The electrical corporation that owns the street light poles shall install or otherwise make the energy efficiency improvements selected by the local government with an appropriately trained workforce in accordance with all applicable safety orders of the commission.
For the purposes of this section, the following terms have the following meanings:
“Electrical corporation” means an electrical corporation, as defined in Section 218, with at least 100,000 service connections in California.
“Street light pole” means a pole, arm, or fixture used primarily for street, pedestrian, or security lighting.
ARTICLE 8. Publicly Owned Utilities [385. - 386.]
Each local publicly owned electric utility shall establish a nonbypassable, usage based charge on local distribution service of not less than the lowest expenditure level of the three largest electrical corporations in California on a percent of revenue basis, calculated from each utility’s total revenue requirement for the year ended December 31, 1994, and each utility’s total annual expenditure under paragraphs (1), (2), and (3) of subdivision (c) of Section 381 and Section 382, to fund investments by the utility and other parties in any or all of the following:
Cost-effective demand-side management services to promote energy efficiency and energy conservation.
New investment in renewable energy resources and technologies consistent with existing statutes and regulations which promote those resources and technologies.
Research, development and demonstration programs for the public interest to advance science or technology which is not adequately provided by competitive and regulated markets.
Services provided for low-income electricity customers, including, but not limited to, energy efficiency services, education, weatherization, and rate discounts.
Each local publicly owned electric utility that has not implemented programs for low-income electricity customers including targeted energy efficiency services and rate discounts based upon the income level of the customer, or completed an assessment of need for those programs, on or before December 31, 2000, shall perform a needs assessment for the programs described in paragraph (4) of subdivision (a) and shall hold one or more public meetings, after notice, to review the findings of the needs assessment. Following the public meetings, the governing body of the local publicly owned electric utility shall determine the amount of the total funds collected pursuant to this section to be allocated to low-income programs, including, but not limited to, targeted energy efficiency services, education, weatherization, and rate discounts. In making its decision on the need for the programs, the governing body shall consider all of the following:
The number and income level of low-income customers that reside in the service area of the utility.
The availability of home weatherization services to low-income customers pursuant to Section 2790.
The availability of in-home energy efficiency education in the utility’s service area.
Other factors that may indicate a need for low-income services.
Following a determination pursuant to subdivision (b) that low-income services are needed, the local publicly owned utility shall promptly implement or expand those programs. The local publicly owned electric utility shall work with existing weatherization providers to implement energy efficiency, education, and weatherization programs.
Each local publicly owned electric utility shall ensure the following:
Low-income families within the utility’s service territory have access to affordable electricity.
The current level of assistance reflects the level of need.
Low-income families are afforded no-cost and low-cost energy efficiency measures that reduce energy consumption.
The local publicly owned electric utility shall consider increasing the level of the discount or raising the eligibility level for any existing rate assistance program to be reflective of customer need.
A publicly owned electric utility shall streamline enrollment for low-income programs by collaborating with existing providers for the Low-Income Home Energy Assistance Program (LIHEAP) and other electric or gas providers within the same service territory.
A local publicly owned electric utility shall establish participation goals for its rate assistance program participation.
ARTICLE 8.5 Provider of Last Resort [387. - 387.]
For purposes of this article, the following terms have the following meanings:
“Carbon-free electrical resource” means a source of electrical generation that emits no greenhouse gases when generating electricity that is deliverable to retail end-use customers in California.
“Load-serving entity” has the same meaning as defined in Section 380.
“Provider of last resort” means a load-serving entity that the commission determines meets the minimum requirements of this article and designates to provide electrical service to any retail customer whose service is transferred to the designated load-serving entity because the customer’s load-serving entity failed to provide, or denied, service to the customer or otherwise failed to meet its obligations.
The provider of last resort shall be the electrical corporation in its service territory unless provided otherwise in a service territory boundary agreement entered into pursuant to Article 1 (commencing with Section 8101) of Chapter 6 of Division 4, or unless another load-serving entity is designated by the commission pursuant to subdivision (c) or (d).
The commission may designate a load-serving entity other than the electrical corporation to serve as a provider of last resort in the electrical corporation’s service territory by approving a joint application by the electrical corporation and the load-serving entity that proposes to become the new provider of last resort in the electrical corporation’s service territory. The application may request a transfer of the responsibilities of the provider of last resort for the entire service territory of the electrical corporation or for a portion of that service territory. The application shall include all of the following:
A demonstrated ability by the load-serving entity seeking to become the new provider of last resort to post a bond sufficient to meet the minimum threshold established pursuant to subdivision (e).
A demonstrated history of contracting for electricity and access to carbon-free electrical resources by the load-serving entity seeking to become provider of last resort.
The full disclosure by the load-serving entity seeking to become the provider of last resort of any fines or penalties imposed by, or violations of law found by, any regulatory body of any state or territory, or the federal government.
A detailed history of the safety record of the load-serving entity seeking to become the provider of last resort.
The commission shall develop a process to facilitate a joint application from load-serving entities that are not electrical corporations to request to transfer the responsibilities of the provider of last resort. This process shall apply when one load-serving entity that is not an electrical corporation has already been designated as a provider of last resort, as described in subdivision (c). The commission may approve a joint application by the designated provider of last resort and the load-serving entity that proposes to become the new provider of last resort in the service territory. The application may request a transfer of responsibilities of the provider of last resort for the entire service territory or for a portion of that service territory. The application shall include all of the elements described in subdivision (c). All of the requirements of this article are applicable to the load-serving entity that proposes to become the new provider of last resort in the applicable service territory.
While a load-serving entity is serving as the new provider of last resort pursuant to subdivision (c) or (d), the commission shall not enforce the provider of last resort requirements on the former provider or providers of last resort.
The commission shall develop additional threshold attributes for a load-serving entity other than an electrical corporation to serve as a provider of last resort to retail end-use customers in California that include all of the following:
Minimum insurance requirements.
Minimum financial requirements necessary to provide electricity to retail end-use customers in each service territory.
Compliance with resource adequacy requirements pursuant to Section 380, requirements of the California Renewables Portfolio Standard Program (Article 16 (commencing with Section 399.11)), integrated resource planning requirements pursuant to Sections 454.51, 454.52, and 454.54, and all other state-mandated procurement requirements.
Any additional minimum requirements that the commission determines are needed to ensure that the provider of last resort will perform its obligation to serve.
The commission shall ensure that the provider of last resort for each service territory receives reasonable cost recovery for being designated and serving as a provider of last resort.
To ensure continued achievement of California’s greenhouse gas emission reduction and air quality goals, and continued accounting of emissions of greenhouse gases for California pursuant to Part 2 (commencing with Section 38530) of Division 25.5 of the Health and Safety Code and other emissions reporting programs, in preparation for an unplanned customer migration to a provider of last resort, the commission, in consultation with the Energy Commission, may do both of the following:
Establish rules for all load-serving entities in preparation of any potentially large and unplanned customer migration.
Recommend to agencies modifications to relevant regulations.
Notwithstanding any other law, electrical corporations shall continue to provide all metering, billing, and collection to retail customers served by the provider of last resort. Bills sent by an electrical corporation to retail customers shall identify the designated provider of last resort. The commission shall determine the terms and conditions under which the electrical corporation provides these services to the provider of last resort.
The commission shall supervise and regulate each provider of last resort, as necessary, as a public utility for the services provided by the provider of last resort pursuant to this article to ensure the provision of electrical service to customers without disruption if a load-serving entity fails to provide, or denies, service to any retail end-use customer in California for any reason. The commission may do all things that are necessary and convenient in the exercise of this power.
This section does not limit the authority of the commission to regulate the terms of service or establish requirements for provider of last resort service by an electrical corporation or any new provider of last resort.
ARTICLE 9. State Agencies [388. - 388.]
Notwithstanding any other provision of law, a state agency may enter into an energy savings contract with a qualified energy service company for the purchase or exchange of thermal or electrical energy or water, or to acquire energy efficiency or water conservation services, or both energy efficiency and water conservation services for a term not exceeding 35 years, at rates and upon those terms approved by the agency.
The Department of General Services or any other state or local agency intending to enter into an energy savings contract or a contract for an energy retrofit project may establish a pool of qualified energy service companies based on qualifications, experience, pricing, or other pertinent factors. Energy service contracts for individual projects undertaken by any state or local agency may be awarded through a competitive selection process to individuals or firms identified in the pool. The pool of qualified energy service companies and contractors shall be reestablished at least every two years or shall expire.
For purposes of this section, the following definitions apply:
“Energy retrofit project” means a project for which the state or local agency works with a qualified energy service company to identify, develop, design, and implement energy conservation measures in existing facilities to reduce energy or water use or make more efficient use of energy or water.
“Energy retrofit project” does not include the erection or installation of a power generation system, a power purchase agreement, or a project utilizing a site license or lease agreement.
“Energy savings” means a measured and verified reduction in fuel, energy, or water consumption when compared to an established baseline of consumption.
“Qualified energy service company” means a company with a demonstrated ability to provide or arrange for building or facility energy auditors, selection and design of appropriate energy savings measures, project financing, implementation of these measures, and maintenance and ongoing measurement of these measures as to ensure and verify energy savings.
ARTICLE 10. Nonutility Power Generators [390. - 390.1.]
Subject to applicable contractual terms, energy prices paid to nonutility power generators by a public utility electrical corporation based upon the commission’s prescribed “short run avoided cost energy methodology” shall be determined as set forth in subdivisions (b) and (c).
Until the requirements of subdivision (c) have been satisfied, short run avoided cost energy payments paid to nonutility power generators by an electrical corporation shall be based on a formula that reflects a starting energy price, adjusted monthly to reflect changes in a starting gas index price in relation to an average of current California natural gas border price indices. The starting energy price shall be based on 12-month averages of recent, pre-January 1, 1996, short-run avoided energy prices paid by each public utility electrical corporation to nonutility power generators. The starting gas index price shall be established as an average of index gas prices for the same annual periods.
The short-run avoided cost energy payments paid to nonutility power generators by electrical corporations shall be based on the clearing price paid by the independent Power Exchange if (1) the commission has issued an order determining that the independent Power Exchange is functioning properly for the purposes of determining the short-run avoided cost energy payments to be made to nonutility power generators, and either (2) the fossil-fired generation units owned, directly or indirectly, by the public utility electrical corporation are authorized to charge market-based rates and the “going forward” costs of those units are being recovered solely through the clearing prices paid by the independent Power Exchange or from contracts with the Independent System Operator, whether those contracts are market-based or based on operating costs for particular utility-owned powerplant units and at particular times when reactive power/voltage support is not yet procurable at market-based rates at locations where it is needed, and are not being recovered directly or indirectly through any other source, or (3) the public utility electrical corporation has divested 90 percent of its gas-fired generation facilities that were operated to meet load in 1994 and 1995. However, nonutility power generators subject to this section may, upon appropriate notice to the public utility electrical corporation, exercise a one-time option to elect to thereafter receive energy payments based upon the clearing price from the independent Power Exchange.
If a nonutility power generator is being paid short-run avoided costs energy payments by an electrical corporation by a firm capacity contract, a forecast as-available capacity contract, or a forecast as-delivered capacity contract on the basis of the clearing price paid by the independent Power Exchange as described in subdivision (c) above, the value of capacity in the clearing price, if any, shall not be paid to the nonutility power generator. The value of capacity in the clearing price, if any, equals the difference between the market clearing customer demand bid at the level of generation dispatched by the independent Power Exchange and the highest supplier bid dispatched.
Short-run avoided energy cost payments made pursuant to this section are in addition to contractually specified capacity payments. Nothing in this section shall be construed to affect, modify or amend the terms and conditions of existing nonutility power generators’ contracts with respect to the sale of energy or capacity or otherwise.
Nothing in this section shall be construed to limit the level of transition cost recovery provided to utilities under electric industry restructuring policies established by the commission.
The term “going forward costs” shall include, but not be limited to, all costs associated with fuel transportation and fuel supply, administrative and general, and operation and maintenance; provided that, for purposes of this section, the following shall not be considered “going forward costs”: (1) commission-approved capital costs for capital additions to fossil-fueled powerplants, provided that such additions are necessary for the continued operation of the powerplants utilized to meet load and such additions are not undertaken primarily to expand, repower or enhance the efficiency of plant operations; or, (2) commission-approved operating costs for particular utility-owned powerplant units and at particular times when reactive power/voltage support is not yet procurable at market-based rates in locations where it is needed, provided that the recovery shall end on December 31, 2001.
Any nonutility power generator using renewable fuels that has entered into a contract with an electrical corporation prior to December 31, 2001, specifying fixed energy prices for five years of output may negotiate a contract for an additional five years of fixed energy payments upon expiration of the initial five-year term, at a price to be determined by the commission.
ARTICLE 11. Information Practices [391. - 392.1.]
The Legislature finds and declares all of the following:
Electricity is essential to the health, safety, and economic well-being of all California consumers.
The restructuring of the electricity industry will create a new electricity market with new marketers and sellers offering new goods and services, many of which may not be readily evaluated by the average consumer.
It is important that these customers be protected from unfair marketing practices and that market participants demonstrate their creditworthiness and technical expertise in order to engage in power sales to these members of the public.
Larger commercial and industrial customers are sophisticated energy consumers that have adequate civil remedies and are adequately protected by existing commercial law, as demonstrated by the absence of significant amounts of contract litigation between commercial and industrial natural gas users and natural gas marketers in California.
It is important to create a market structure that will not unduly burden new entrants into the competitive electric market, or California may not receive the full benefits of reduced electricity costs through competition.
It is appropriate to create a system of registration and consumer protection for the electric industry, designed to ensure sufficient protection for residential and small commercial consumers while simplifying entry into the market for responsible entities serving larger, more sophisticated customers.
It is the intent of the Legislature that:
Electricity consumers be provided with sufficient and reliable information to be able to compare and select among products and services provided in the electricity market.
Consumers be provided with mechanisms to protect themselves from marketing practices that are unfair or abusive.
Pursuant to the authority granted to the commission in this part as to registration and consumer protection matters, the commission shall balance the need to maximize competition by reducing barriers to entry into the small retail electricity procurement market with the need to protect small consumers against deceptive, unfair, or abusive business practices, or insolvency of the entity offering retail electric service.
It is the intent of the Legislature in enacting this act to further the policies of AB 1890 (Chapter 854, Statutes of 1996) relating to electric industry restructuring.
Electrical corporations shall disclose each component of the electrical bill as follows:
The total charges associated with transmission and distribution, including that portion comprising the research, environmental, and low-income funds.
The total charges associated with generation, including the competition transition charge.
Electrical corporations shall provide conspicuous notice that if the customer elects to purchase electricity from another provider that customer will continue to be liable for payment of the competition transition charge. This paragraph does not prohibit the commission from requiring additional information.
Prior to the implementation of the competition transition charge, electric corporations, in conjunction with the commission, shall devise and implement a customer education program informing customers of the changes to the electric industry. The program shall provide customers with information necessary to help them make appropriate choices as to their electric service. The education program shall be subject to approval by the commission.
The standard bill format developed by the commission pursuant to subdivision (e) of Section 394.4 shall also apply to electrical corporations.
The commission shall compile and regularly update the names and contact numbers of registered providers.
The commission shall also compile and regularly update information to assist consumers in making service choices and the number of customer complaints against specific providers in relation to the number of customers served by those providers and the disposition of those complaints. To facilitate this function, registered entities shall file with the commission information describing the terms and conditions of any standard service plan made available to residential and small commercial customers. The commission shall adopt a standard format for this filing. The commission shall maintain and make generally available a list of entities offering electrical services operating in California. This list shall include all registered providers and those providers not required to be registered who request the commission to be included in the list. The commission shall, upon request, make this information available at no charge. Notwithstanding any other provision of law, public agencies that are registered entities shall be required to disclose their terms and conditions of service contracts only to the same extent that other registered entities would be required to disclose the same or similar service contracts.
The commission shall issue public alerts about companies attempting to provide electric service in the state in an unauthorized or fraudulent manner as defined in subdivision (b) of Section 394.25.
This subdivision is inoperative except for time periods in which providers are authorized to offer service to residential customers and the combined enrollments in competitive retail electric service in the service territories of the Pacific Gas and Electric Company, Southern California Edison Company, and San Diego Gas and Electric Company increase at a rate of more than 5 percent per month.
The commission shall notify, in writing, the Secretary of State at the beginning and end of any time period described in subparagraph (A).
ARTICLE 12. Consumer Protection [394. - 396.5.]
As used in this section, “electric service provider” means an entity that offers electrical service to customers within the service territory of an electrical corporation, but does not include an electrical corporation, as defined in Section 218, does not include an entity that offers electrical service solely to serve customer load consistent with subdivision (b) of Section 218, and does not include a public agency that offers electrical service to residential and small commercial customers within its jurisdiction, or within the service territory of a local publicly owned electric utility. “Electric service provider” includes the unregulated affiliates and subsidiaries of an electrical corporation, as defined in Section 218.
Each electric service provider shall register with the commission. As a precondition to registration, the electric service provider shall provide, under oath, declaration, or affidavit, all of the following information to the commission:
Legal name and any other names under which the electric service provider is doing business in California.
Current telephone number.
Current address.
Agent for service of process.
State and date of incorporation, if any.
Number for a customer contact representative, or other personnel for receiving customer inquiries.
Brief description of the nature of the service being provided.
Disclosure of any civil, criminal, or regulatory sanctions or penalties imposed within the 10 years immediately prior to registration, against the company or any owner, partner, officer, or director of the company pursuant to any state or federal consumer protection law or regulation, and of any felony convictions of any kind against the company or any owner, partner, officer, or director of the company. In addition, each electric service provider shall furnish the commission with fingerprints for those owners, partners, officers, and managers of the electric service provider specified by any commission decision applicable to all electric service providers. The commission shall submit completed fingerprint cards to the Department of Justice. Those fingerprints shall be available for use by the Department of Justice and the Department of Justice may transmit the fingerprints to the Federal Bureau of Investigation for a national criminal history record check. The commission may use information obtained from a national criminal history record check conducted pursuant to this section to determine an electric service provider’s eligibility for registration.
Proof of financial viability. The commission shall develop uniform standards for determining financial viability and shall publish those standards for public comment no later than March 31, 1998. In determining the financial viability of the electric service provider, the commission shall take into account the number of customers the potential registrant expects to serve, the number of kilowatthours of electricity it expects to provide, and any other appropriate criteria to ensure that residential and small commercial customers have adequate recourse in the event of fraud or nonperformance.
Proof of technical and operational ability. The commission shall develop uniform standards for determining technical and operational capacity and shall publish those standards for public comment no later than March 31, 1998.
Any registration filing approved by the commission prior to the effective date of this section which does not comply in all respects with the requirements of subdivision (a) of Section 394 shall nevertheless continue in force and effect so long as within 90 days of the effective date of this section the electric service provider undertakes to supplement its registration filing to the satisfaction of the commission. Any registration that is not supplemented by the required information within the time set forth in this subdivision shall be suspended by the commission and shall not be reinstated until the commission has found the registration to be in full compliance with subdivision (a) of Section 394.
Any public agency offering aggregation services as provided for in Section 366 solely to retail electric customers within its jurisdiction that has registered with the commission prior to the enactment of this section may voluntarily withdraw its registration to the extent that it is exempted from registration under this chapter.
Before reentering the market, electric service providers whose registration has been revoked shall file a formal application with the commission that satisfies the requirements set forth in Section 394.1 and demonstrates the fitness and ability of the electric service provider to comply with all applicable rules of the commission.
Registration with the commission is an exercise of the licensing function of the commission, and does not constitute regulation of the rates or terms and conditions of service offered by electric service providers. Nothing in this part authorizes the commission to regulate the rates or terms and conditions of service offered by electric service providers.
The registration shall be deemed approved and a registration number issued no later than 45 days after the required information has been submitted, unless the commission’s executive director finds, upon review of the information submitted by the electric service provider or available to the commission, that there is evidence to support a finding that the electric service provider has committed an act constituting grounds for denial of registration as specifically set forth in the operative provisions of this chapter, including, but not limited to, subdivision (c).
Upon a finding by the commission’s executive director that there is evidence to support a finding that the electric service provider has committed an act constituting grounds for denial of registration as set forth in this section, the commission shall notify the electric service provider in writing, cause the documents submitted by the electric service provider to be filed as a formal application for registration, and notice an expedited hearing on the registration of the electric service provider to be held within 30 days of the notification to the electric service provider of the executive director’s finding of evidence to support denial of registration. The commission shall, within 45 days after holding the hearing, issue a decision on the registration request which shall be based on the findings of fact and conclusions of law based on the evidence presented at the hearing. The decision shall include the findings of fact and the conclusions of law relied upon.
The commission may deny an application for registration in accordance with subdivision (b) on the grounds that the electric service provider or any officer or director of the electric service provider has one or more of the following:
Been convicted of a crime as described in paragraph (8) of subdivision (a) of Section 394.
Failure to make a sufficient showing with respect to paragraphs (1) to (10), inclusive, of subdivision (a) of Section 394.
Knowingly made a false statement of fact in the application for registration.
The commission may deny registration pursuant to this subdivision only if the crime or act is substantially related to the qualifications, functions, or duties required to provide retail electric service to end use customers of electricity or the false statement is material to the registration application. For purposes of this subdivision, conviction of a crime shall be established in the same manner as that set forth in paragraph (1) of subdivision (a) of Section 480 of the Business and Professions Code.
The commission shall require electric service providers registered under this section to update their registration information set forth in paragraphs (1) to (10), inclusive, of subdivision (a) of Section 394 within 60 days of any material change in the information provided. Material changes to any other information required pursuant to this article shall be updated annually.
The commission shall accept, compile, and attempt to informally resolve consumer complaints regarding electric service providers. Where the commission reasonably suspects a pattern of customer abuses, the commission may, on its own motion, initiate investigations into the activities of electric service providers offering electrical service. Consumer complaints regarding service by a public agency offering electric service within the political boundary of the public agency or service territory of a local publicly owned electric utility shall continue to be resolved by the public agency. Within the service territory of a local publicly owned utility, consumer complaints arising from the violation of direct access rules adopted by the governing body of the local publicly owned utility shall be resolved through the local publicly owned utility’s consumer complaint procedures.
Notwithstanding other provisions, residential and small commercial customers shall have the option to proceed with a complaint against an electric service provider either through an action filed in the judicial court system or through a complaint filed with the commission. A customer who elects either the judicial or commission remedies may not raise the same claim in both forums. The commission shall have the authority to accept, compile, and resolve residential, and small commercial consumer complaints, including the authority to award reparations. The commission’s authority in these complaint proceedings is limited to adjudication of complaints regarding residential and small commercial electric service provided by an electric service provider and shall not be expanded to include either an award of any other damages or regulation of the rates or charges of the electric service provider. However, a person or electric service provider that takes a conflict to the commission shall not be precluded from pursuing an appeal of the decision through the courts as provided for in law.
In connection with customer complaints or commission investigations into customer abuses, electric service providers shall provide the commission access to their accounts, books, papers, and documents related to California transactions as described in Sections 313 and 314, provided the information is relevant to the complaint or investigation.
No electric service provider may discontinue service to a customer for a disputed amount if that customer has filed a complaint that is pending with the commission, and that customer has paid the disputed amount into an escrow account.
The commission may enforce the provisions of Sections 2102, 2103, 2104, 2105, 2107, 2108, and 2114 against electric service providers as if those electric service providers were public utilities as defined in these code sections. Notwithstanding the above, nothing in this section grants the commission jurisdiction to regulate electric service providers other than as specifically set forth in this part. Electric service providers shall continue to be subject to the provisions of Sections 2111 and 2112. Upon a finding by the commission’s executive director that there is evidence to support a finding that the electric service provider has committed an act constituting grounds for suspension or revocation of registration as set forth in subdivision (b) of Section 394.25, the commission shall notify the electric service provider in writing and notice an expedited hearing on the suspension or revocation of the electric service provider’s registration to be held within 30 days of the notification to the electric service provider of the executive director’s finding of evidence to support suspension or revocation of registration. The commission shall, within 45 days after holding the hearing, issue a decision on the suspension or revocation of registration, which shall be based on findings of fact and conclusions of law based on the evidence presented at the hearing. The decision shall include the findings of fact and the conclusions of law relied upon.
An electric service provider may have its registration suspended or revoked, immediately or prospectively, in whole or in part, for any of the following acts:
Making material misrepresentations in the course of soliciting customers, entering into service agreements with those customers, or administering those service agreements.
Dishonesty, fraud, or deceit with the intent to substantially benefit the electric service provider or its employees, agents, or representatives, or to disadvantage retail electricity customers.
Where the commission finds that there is evidence that the electric service provider is not financially or operationally capable of providing the offered electric service.
The misrepresentation of a material fact by an applicant in obtaining a registration pursuant to Section 394.
Pursuant to its authority to revoke or suspend registration, the commission may suspend a registration for a specified period or revoke the registration, or in lieu of suspension or revocation, impose a moratorium on adding or soliciting additional customers. Any suspension or revocation of a registration shall require the electric service provider to cease serving customers within the boundaries of electrical corporations, and the affected customers shall be served by the electrical corporation until the time when they may select service from another service provider. Customers shall not be liable for the payment of any early termination fees or other penalties to any electric service provider under the service agreement if the serving electric service provider’s registration is suspended or revoked.
The commission shall require any electric service provider whose registration is revoked pursuant to paragraph (4) of subdivision (b) to refund all of the customer credit funds that the electric service provider received from the Energy Commission pursuant to subdivision (a) of Section 25744 of the Public Resources Code. The repayment of these funds shall be in addition to all other penalties and fines appropriately assessed against the electric service provider for committing those acts under other provisions of law. All customer credit funds refunded under this subdivision shall be deposited in the Renewable Resource Trust Fund for redistribution by the Energy Commission pursuant to Chapter 8.6 (commencing with Section 25740) of Division 15 of the Public Resources Code. This subdivision may not be construed to apply retroactively.
If a customer of an electric service provider or a community choice aggregator is involuntarily returned to service provided by an electrical corporation, any reentry fee imposed on that customer that the commission deems is necessary to avoid imposing costs on other customers of the electrical corporation shall be the obligation of the electric service provider or a community choice aggregator, except in the case of a customer returned due to default in payment or other contractual obligations or because the customer’s contract has expired. As a condition of its registration, an electric service provider or a community choice aggregator shall post a bond or demonstrate insurance sufficient to cover those reentry fees. In the event that an electric service provider becomes insolvent and is unable to discharge its obligation to pay reentry fees, the fees shall be allocated to the returning customers.
When a customer files a claim with an electrical corporation for damages to property resulting from the curtailment of electric service due to the failure of the electrical corporation to reasonably provide service or restore service within a reasonable time after a fire, flood, earthquake, other natural disaster, or act of God, the electric corporation shall inform the customer that such claim may be pursued in small claims court or other judicial courts, depending on the amount of the claim.
To carry out essential elements of a sustainable and effective consumer protection program in connection with electric service providers offering electrical service to residential and small commercial customers as intended by the Legislature in this article, the following shall apply:
The commission shall collect a registration fee of one hundred dollars ($100) from electric service providers required to register under this article, and deposit the fee proceeds in the Public Utilities Reimbursement Account established under Section 402.
The commission shall annually determine the costs of administering the registration program and other facets of consumer protection directly related to the direct access transactions of electric service providers. The commission shall collect only those costs not already being collected elsewhere. A registrant who fails to submit to the commission a required fee or a piece of information upon which fees are calculated within 30 days of billing shall be subject to a 15-percent penalty.
Rules that implement the following minimum standards shall be adopted by the commission for electric service providers offering electrical services to residential and small commercial customers and the governing body of a public agency offering electrical services to residential and small commercial customers within its jurisdiction:
Confidentiality: Customer information shall be confidential unless the customer consents in writing. This shall encompass confidentiality of customer specific billing, credit, or usage information. This requirement shall not extend to disclosure of generic information regarding the usage, load shape, or other general characteristics of a group or rate classification, unless the release of that information would reveal customer specific information because of the size of the group, rate classification, or nature of the information.
Physical disconnects and reconnects: Only an electrical corporation, or a publicly owned electric utility, that provides physical delivery service to the affected customer shall have the authority to physically disconnect or reconnect a customer from the transmission or distribution grid. Physical disconnection by electrical corporations subject to the commission’s jurisdiction shall occur only in accordance with protocols established by the commission. Physical disconnection by publicly owned electric utilities shall occur only in accordance with protocols established by the governing board of the local publicly owned electric utility.
Change in providers: Upon adequate notice supplied by a electric service provider to the electric corporation or local publicly owned electric utility providing physical delivery service, customers who are eligible for direct access may change their energy supplier. Energy suppliers may charge for this change, provided that any fee or penalty charged by the supplier associated with early termination of service, shall be disclosed in that contract or applicable tariff.
Written notices: Notices describing the terms and conditions of service as described in Section 394.5, service agreements, notices of late payment, notices of discontinuance of service, and disconnection notices addressed to residential and small commercial customers shall be easily understandable, and shall be provided in the language in which the electric service provider offered the services.
Billing: All bills shall have a standard bill format, as determined by the commission or the governing body, and shall contain sufficient detail for the customer to recalculate the bill for accuracy. Any late fees shall be separately stated. Each electric service provider shall provide on all customer bills a phone number by which customers may contact the electric service provider to report and resolve billing inquiries and complaints. An electric service provider contacted by a customer regarding a billing dispute shall advise the customer at the time of the initial contact that the customer may file a complaint with the commission if its dispute is not satisfactorily resolved by the electric service provider.
Meter integrity: An electric customer shall have a reasonable opportunity to have its meter tested to ensure the reasonable accuracy of the meter. The commission or governing body shall determine who is responsible for the cost of that testing.
Customer deposits: Electric service providers may require customer deposits before commencing service, but in no event shall the deposit be more than the estimated bill for the customer for a three-month period.
Additional protections: The commission or the governing body may adopt additional residential and small commercial consumer protection standards that are in the public interest.
Except for an electrical corporation as defined in Section 218, or a local publicly owned electric utility offering electrical service to residential and small commercial customers within its service territory, each electric service provider offering electrical service to residential and small commercial customers shall, prior to the commencement of service, provide the potential customer with a written notice of the service describing the price, terms, and conditions of the service. A notice shall include all of the following:
A clear description of the price, terms, and conditions of service, including:
The price of electricity expressed in a format that makes it possible for residential and small commercial customers to compare and select among similar products and services on a standard basis. The commission shall adopt rules to implement this subdivision. The commission shall require disclosure of the total price of electricity on a cents-per-kilowatthour basis, including the costs of all electric services and charges regulated by the commission. The commission shall also require estimates of the total monthly bill for the electric service at varying consumption levels, including the costs of all electric services and charges regulated by the commission. In determining these rules, the commission may consider alternatives to the cents-per-kilowatthour disclosure if other information would provide the customer with sufficient information to compare among alternatives on a standard basis.
Separate disclosure of all recurring and nonrecurring charges associated with the sale of electricity.
If services other than electricity are offered, an itemization of the services and the charge or charges associated with each.
A description of the potential customer’s right to rescind the contract without fee or penalty as described in Section 395.
An explanation of the customer’s financial obligations, as well as the procedures regarding past due payments, discontinuance of service, billing disputes, and service complaints.
The electric service provider’s registration number, if applicable.
The right to change service providers upon written notice, including disclosure of any fees or penalties assessed by the supplier for early termination of a contract.
A description of the availability of low-income assistance programs for qualified customers and how customers can apply for these programs.
The commission may assist electric service providers in developing the notice. The commission may suggest inclusion of additional information it deems necessary for the consumer protection purposes of this section. On at least a semiannual basis, electric service providers shall provide the commission with a copy of the form of notice included in standard service plans made available to residential and small commercial customers.
An electric service provider offering electric services who declines to provide those services to a consumer shall, upon request of the consumer, disclose to that consumer the reason for the denial in writing within 30 days. At the time service is denied, the electric service provider shall disclose to the consumer the right to make this request. A consumer shall have at least 30 days from the date service is denied to make the request.
For purposes of this article, service territory of a local publicly owned electric utility means within the boundaries of its service territory as it existed on December 20, 1995, or within the boundaries specified in an applicable service territory boundary agreement entered into pursuant to Article 1 (commencing with Section 8101) of Division 4, or any other provision of law, between an electrical corporation and the affected local publicly owned electric utility, or within the boundaries specified in an applicable service territory boundary agreement between one local publicly owned electric utility and another local publicly owned electric utility. Furthermore, for purposes of this article, the boundaries of the Merced Irrigation District shall be as those boundaries existed on December 20, 1995, together with the territory of Castle Air Force Base, which was located outside of the district on that date.
The commission shall maintain a list of residential and small commercial customers who do not wish to be solicited by telephone, by an electric corporation, marketer, broker, or aggregator for electric service, to subscribe to or change their electric service provider. The commission shall not assess a charge for inclusion of a customer on the list. The list shall be updated periodically, but no less than quarterly.
The list shall include sufficient information for electric corporations, marketers, brokers, or aggregators of electric service to identify customers who do not wish to be solicited, including a customer’s address and telephone number. The list shall be made accessible electronically from the commission to any party regulated as an electric corporation or registered at the commission as an electric marketer, broker, or aggregator of electric service.
An electric corporation, marketer, broker, or aggregator of electric service shall not solicit, by telephone, any customer on the list prepared pursuant to subdivision (a). Any electric corporation, marketer, broker, or aggregator of electric service, or the representative of an electric corporation, marketer, broker, or aggregator of electric service, who solicits any customer on the list prepared pursuant to subdivision (a) more than once shall be liable to the customer for twenty-five dollars ($25) for each contact in violation of this subdivision.
This section shall not apply to the telephone verification required pursuant to Section 366.5.
Notwithstanding any other provision of this article, requirements placed on an electric service provider shall not apply to electrical services provided by a local publicly owned electric utility to customers within the jurisdiction or service territory of that local publicly owned electric utility.
Unclaimed refunds ordered by the commission, and any accrued interest, may be used by the commission to fund additional consumer protection efforts.
In addition to any other right to revoke an offer, residential and small commercial customers of electrical service, as defined in subdivision (h) of Section 331, have the right to cancel a contract for electric service until midnight of the third business day after the day on which the buyer signs an agreement or offer to purchase.
Cancellation occurs when the buyer gives written notice of cancellation to the seller at the address specified in the agreement or offer.
Notice of cancellation, if given by mail, is effective when deposited in the mail properly addressed with postage prepaid.
Notice of cancellation given by the buyer need not take the particular form as provided with the contract or offer to purchase and, however expressed, is effective if it indicates the intention of the buyer not to be bound by the contract.
A consumer damaged by a violation of this article by an electric service provider is entitled to recover all of the following:
Actual damages.
The consumer’s reasonable attorney’s fees and court costs.
Exemplary damages, in the amount the court deems proper, for intentional or willful violations.
Equitable relief as the court deems proper.
The rights, remedies, and penalties established by this article are in addition to the rights, remedies, or penalties established under any other law.
Nothing in this article shall abrogate any authority of the Attorney General to enforce existing law.
The governing body of a community choice aggregator shall adopt a policy that expressly prohibits the dissemination by the community choice aggregator of any statement relating to the community choice aggregator’s rates or terms and conditions of service that is untrue or misleading, and that is known, or that, by the exercise of reasonable care, should be known, to be untrue or misleading.
ARTICLE 13. Allocation of Electrical System Costs [397. - 397.]
The commission shall, in an existing or a new proceeding, develop methodologies for allocating electrical system integration resource procurement needs to each load-serving entity, as defined in Section 380, based on the contribution of the load-serving entity’s load and resource portfolio to the electrical system conditions that created the need for the procurement and for determining any costs resulting from a failure of a load-serving entity to satisfy its allocated procurement needs. Those needs and costs shall be limited to those that are subject to the commission’s jurisdiction pursuant to Section 380, 454.51, or 454.52.
The electrical system integration resource procurement needs and costs described in paragraph (1) shall include, but are not limited to, those relating to the following:
Resource adequacy requirements associated with system flexibility, as described in subdivision (c) of Section 380.
Integration resources identified as needed, or proposed in response to system operational needs identified, through the process described in subdivision (a) of Section 454.51.
The commission shall use the methodologies developed pursuant to subdivision (a) in allocating electrical system integration resource procurement needs and any costs resulting from a failure to procure resources to satisfy those allocated procurement needs pursuant to Section 380, 454.51, or 454.52.
For purposes of this section, “electrical system integration resources” means resources that provide certain electrical system integration functions, benefits, or attributes, such as flexible ramping capability.
This section does not require the procurement of a specific resource or technology type.
ARTICLE 14. Disclosure of Sources of Electrical Generation [398.1. - 398.6.]
The Legislature finds and declares that there is a need for reliable, accurate, timely, and consistent information regarding fuel sources for electric generation offered for retail sale in California.
The purpose of this article is to establish a program under which entities offering electric services in California disclose accurate, reliable, and simple to understand information on the sources of energy, and the associated emissions of greenhouse gases, that are used to provide electric services.
The definitions set forth in this section shall govern the construction of this article.
“Greenhouse gas emissions intensity” means the sum of all annual emissions of greenhouse gases associated with a generation source divided by the annual production of electricity from the generation source.
“Retail supplier” means an entity that offers an electricity product for sale to retail consumers in California, including an electrical corporation, local publicly owned electric utility, electric service provider, and community choice aggregator.
“System operator” means the Independent System Operator with responsibility for the efficient use and reliable operation of the transmission grid, as provided by Section 345, or a local publicly owned electric utility that does not utilize the Independent System Operator.
“Purchases of electricity from specified sources” or “purchases from specified sources” means electricity transactions that are traceable to specific generation sources by any auditable contract trail or equivalent, such as a tradable commodity system, that provides commercial verification that the electricity source claimed has been sold once and only once to a retail consumer. Retail suppliers may rely on annual data to determine whether a transaction meets this definition, rather than hour-by-hour matching of loads and resources.
“Electricity from unspecified sources” means electricity that is not traceable to specific generation sources by any auditable contract trail or equivalent, including a tradable commodity system, that provides commercial verification that the electricity source claimed has been sold once, and only once, to a retail consumer.
Beginning January 1, 1998, or as soon as practicable thereafter, each generator that provides meter data to a system operator shall report to the system operator electricity generated in kilowatthours by hour by generator, the fuel type or fuel types and fuel consumption by fuel type by month on an historical recorded quarterly basis. Facilities using only one fuel type may satisfy this requirement by reporting fuel type only. With regard to any facility using more than one fuel type, reports shall reflect the fuel consumed as a percentage of electricity generation.
The Energy Commission shall have authorization to access the electricity generation data in kilowatthours by hour for each facility that provides meter data to the system operator, and the fuel type or fuel types.
With regard to out-of-state generation, the Energy Commission shall have authorization to access the electricity generation data in kilowatthours by hour at the point at which out-of-state generation is metered, to the extent the information has been submitted to a system operator.
Trade secrets as defined in subdivision (d) of Section 3426.1 of the Civil Code contained in the information provided to the system operators pursuant to this section shall be treated as confidential. These data may be disclosed only by the system operators and only by authorization of the generator except that the Energy Commission shall have authorization to access these data, shall consider all these data to be trade secrets, and shall only release these data in an aggregated form such that trade secrets cannot be discerned.
Every retail supplier that makes an offering to sell electricity that is consumed in California shall disclose its electricity sources and the associated greenhouse gases emissions intensity for the previous calendar year.
The disclosures required by this section shall be made to potential end-use consumers in all product-specific written promotional materials that are distributed to consumers by either printed or electronic means, including the retail supplier’s internet website, if one exists, except that advertisements and notices in general circulation media shall not be subject to this requirement.
The disclosures required by this section shall be made annually to end-use consumers of the offered electricity. The annual disclosure shall be made on the retail supplier’s internet website by October 1 of each year, and in written promotional materials by the end of the first complete billing cycle for the fourth quarter of the year, and shall be consistent with information provided to the Energy Commission pursuant to Section 398.5. A retail supplier may distribute the disclosures required by this section via email to any end-use consumer that has consented to receive email in lieu of printed materials.
The disclosures required by this section shall be made separately for each portfolio offering made by the retail supplier.
On or before January 1, 1998, the Energy Commission shall specify guidelines for the format and means for disclosure required by Section 398.3 and this section, based on the requirements of this article and subject to public hearing.
The costs of making the disclosures required by this section shall be considered to be generation related.
The disclosures required by this section shall comply with the following:
A retail supplier’s disclosure of its electricity sources shall be expressed as a percentage of annual sales derived from each of the following categories:
Electricity from unspecified sources.
Purchases of electricity from specified sources.
A retail supplier’s disclosure of its electricity sources shall also separately identify total California system electricity, which is the sum of all in-state generation and net electricity imports by fuel type.
Each of the categories specified in subdivision (g) shall be additionally identified as a percentage of annual sales that is derived from the following fuels, sources of energy, or electricity products:
Coal.
Large hydroelectric (greater than 30 megawatts).
Natural gas.
Nuclear.
Eligible renewable energy resources pursuant to the California Renewables Portfolio Standard Program (Article 16 (commencing with Section 399.11)), including any of the following:
Biomass and biowaste.
Geothermal.
Eligible hydroelectric.
Solar.
Wind.
Other categories as determined by the Energy Commission.
The portion of annual sales derived from unbundled renewable energy credits shall be included in the disclosures in a format determined by the Energy Commission. A retail supplier may include additional information related to the sources of the unbundled renewable energy credits.
All electricity sources disclosed as purchases of electricity from specified sources shall meet the requirements of subdivision (d) of Section 398.2.
Purchases of electricity from specified sources identified pursuant to this section shall be from sources connected to the Western Electricity Coordinating Council interconnected grid.
Each retail supplier shall disclose both the greenhouse gas emissions intensity of any electricity portfolio offered to its retail customers and the Energy Commission’s calculation of greenhouse gas emissions intensity associated with all statewide retail electricity sales, consistent with the requirements of this subdivision.
The Energy Commission shall do all of the following:
Adopt a methodology, in consultation with the State Air Resources Board, for the calculation of greenhouse gas emissions intensity for each purchase of electricity by a retail supplier to serve its retail customers.
Calculate the greenhouse gas emissions intensity associated with statewide retail electricity sales based on the greenhouse gas emissions for total California system electricity.
Rely on the most recent verified greenhouse gas emissions data while ensuring that greenhouse gas emissions intensity factors for electricity from specified and unspecified sources are available to retail suppliers with sufficient advance notice to permit timely reporting.
Establish guidelines for adjustments to a greenhouse gas emissions intensity factor for a reporting year for any local publicly owned electric utility demonstrating generation of quantities of electricity in previous years in excess of its total retail sales and wholesale sales from specified sources that do not emit any greenhouse gases. Adjustments authorized by the guidelines established by the Energy Commission shall not permit excess generation procured in a single year to be counted more than once or to be resold to another retail supplier as a specified source.
Ensure that there is no double-counting of the greenhouse gas emissions or emissions attributes associated with any unit of electricity production reported by a retail supplier for any specific generating facility or unspecified source located within the Western Electricity Coordinating Council when calculating greenhouse gas emissions intensity.
On or before January 1, 2018, adopt guidelines, through an open process, subject to public comment, and adopted by a vote of the Energy Commission, for the reporting and disclosure of greenhouse gas emissions intensity associated with retail sales based on the requirements of this subdivision. Beginning June 1, 2020, retail suppliers shall be required to report data on greenhouse gas emissions intensity associated with retail sales occurring after December 31, 2018.
Any new community choice aggregator formed after January 1, 2016, shall not be required to report data on greenhouse gas emissions intensity associated with retail sales until at least 24 months, but shall be required to report that data no later than 36 months, after serving its first retail customer.
Any marketing or retail product claims relating to the greenhouse gas emissions intensity of the electric supply portfolio of a retail supplier shall be consistent with the methodology adopted by the Energy Commission pursuant to this section. Retail suppliers may provide additional information to customers describing other actions relating to greenhouse gases that are unrelated to the electric supply portfolio.
Retail suppliers shall annually report to the Energy Commission, for each electricity offering for the previous calendar year, each of the following:
The kilowatthours purchased, by generator and fuel type during the previous calendar year, consistent with the meter data, including losses, reported to the system operator.
The kilowatthours purchased from unspecified sources in California and from unspecified sources imported into California from other subregions within the Western Electricity Coordinating Council.
For each electricity offering, the kilowatthours sold at retail.
For each electricity offering, the disclosures made to consumers pursuant to Section 398.4.
Information submitted to the Energy Commission pursuant to this section that is a trade secret as defined in subdivision (d) of Section 3426.1 of the Civil Code shall not be released except in an aggregated form such that trade secrets cannot be discerned.
The Energy Commission shall specify guidelines and standard formats, based on the requirements of this article and subject to public hearing, for the submittal of information pursuant to this article.
In developing the rules and procedures specified in this section, the Energy Commission shall seek to minimize the reporting burden and cost of reporting that it imposes on retail suppliers.
The Energy Commission may verify environmental and procurement claims made by retail suppliers.
For purposes of this section, the following definitions apply:
“Avoided greenhouse gas emissions” means greenhouse gas emissions associated with hourly purchases of electricity from specified sources that are in excess of the retail supplier’s loss-adjusted load for that hour to the extent that the excess electricity reduced the emissions of greenhouse gases associated with electricity from unspecified sources during that hour.
“Electricity source type” means the fuel, source of energy, or electricity product, as described in subdivision (h) of Section 398.4.
“Load-serving entity” has the same meaning as defined in Section 380.
“Loss-adjusted load” means the total amount of electricity, measured at the utility-scale generation source, that a retail supplier requires in order to provide for retail sales after electrical losses in transmission and distribution.
Beginning January 1, 2028, every retail supplier that offers an electricity product for sale to retail customers in the state shall annually report to the Energy Commission all of the following information:
The retail supplier’s sources of electricity used to serve loss-adjusted load for each hour during the previous calendar year.
To the extent feasible, the emissions of greenhouse gases associated with each of those sources of electricity. In calculating those emissions of greenhouse gases, the retail supplier shall not include or consider any avoided greenhouse gas emissions.
An annual total of greenhouse gas emissions and an annual average greenhouse gas emissions intensity, calculated as the annual total greenhouse gas emissions divided by the retail supplier’s annual total loss-adjusted load.
An annual total of avoided greenhouse gas emissions.
On or before July 1, 2024, the Energy Commission shall adopt rules, through an open process, subject to public comment, and adopted by a vote of the Energy Commission, to implement the requirements of this section.
The Energy Commission shall share the information collected pursuant to subdivision (b) with the commission, the State Air Resources Board, and the system operator, to the extent needed, for purposes of the following:
The Energy Commission shall annually publish on its internet website an aggregated summary of the data reported by each retail supplier pursuant to this section, which may include all of the following:
Electricity from specified sources expressed as a percentage of annual loss-adjusted load that is derived from each electricity source type.
Electricity from unspecified sources expressed as a percentage of annual loss-adjusted load.
The total emissions of greenhouse gases associated with all electricity used to serve loss-adjusted load. In calculating those emissions of greenhouse gases, any avoided greenhouse gas emissions shall not be included or considered.
The average greenhouse gas emissions intensity of all electricity used to serve loss-adjusted load.
The total avoided greenhouse gas emissions.
In order to ensure that a retail supplier can obtain the information necessary to comply with the requirements of this section and to protect the confidentiality of market sensitive data, all of the following shall be required:
All sellers of electricity from generation facilities shall timely provide each purchaser of the facility’s electricity that is subject to the reporting requirement in subdivision (b) with the purchaser’s hourly share of electricity that is scheduled into a California balancing authority and the emissions of greenhouse gases associated with that electricity.
All sellers of electricity from energy storage facilities shall timely provide each purchaser of the facility’s exported electricity that is subject to the reporting requirement in subdivision (b) with the purchaser’s hourly share of exported electricity and the hourly electricity consumed by the energy storage facility in prior hours sufficient to provide the exported electricity after taking into account round-trip losses within the energy storage facility. If the purchaser of the facility’s exported electricity is not responsible for providing the electricity consumed by the energy storage facility in prior hours, the seller of electricity from the energy storage facility shall also provide the purchaser with the electricity source type and the emissions of greenhouse gases associated with the electricity consumed by the energy storage facility in prior hours.
An entity allocating electricity from specified sources shall timely provide each retail supplier to whom a share of the electricity is allocated with the retail supplier’s hourly share of electricity from each specified source and the emissions of greenhouse gases associated with that electricity.
The recipients of hourly data pursuant to this subdivision shall maintain the confidentiality of the data received and use it solely for the purpose of meeting the requirements of this section.
The recipients of hourly data pursuant to this subdivision shall share the hourly data as necessary, and under the same confidentiality requirements, with subsequent purchasers of the electricity from specified sources.
The commission shall review the total annual emissions of greenhouse gases and the annual average greenhouse gas emissions intensity reported for each load-serving entity pursuant to this section and may assess whether those emissions of greenhouse gases, combined with the load-serving entity’s procurement plans for subsequent years, demonstrate adequate progress toward achieving the load-serving entity’s greenhouse gas emissions targets established pursuant to Section 454.52. The commission shall provide its findings for each community choice aggregator to the community choice aggregator’s governing board.
The governing board of each local publicly owned electric utility shall review the total annual emissions of greenhouse gases and the annual average greenhouse gas emissions intensity reported for each local publicly owned electric utility pursuant to this section and may assess whether those emissions of greenhouse gases, combined with the local publicly owned electric utility’s procurement plans for subsequent years, demonstrate adequate progress toward achieving the local publicly owned electric utility’s greenhouse gas emissions targets established pursuant to Section 9621. A local publicly owned electric utility may use existing board processes to facilitate this paragraph.
Information submitted to the Energy Commission pursuant to this section that is a trade secret, as defined in subdivision (d) of Section 3426.1 of the Civil Code, shall not be released except in an aggregated form such that trade secrets cannot be discerned.
It is the intent of the Legislature that the reporting, evaluation, and progress assessment requirements of this section shall not constitute a new electricity procurement obligation for load-serving entities or for local publicly owned electric utilities.
The requirements of this section shall not apply to the following types of retail suppliers:
Load-serving entities that are not subject to the requirements of Section 454.52.
Local publicly owned electric utilities that are not subject to the requirements of Section 9621.
In developing the rules and procedures specified in this section, the Energy Commission shall seek to minimize the reporting burden and the cost of reporting that it imposes on retail suppliers.
The Energy Commission may modify or adjust the requirements of this section for any electrical corporation with 60,000 or fewer customer accounts in the state or any retail supplier with an annual electrical demand of less than 1,000 gigawatthours, if the Energy Commission finds that the costs to comply with the requirements of this section unduly burden the electrical corporation or retail supplier.
The Energy Commission may delay when retail suppliers shall begin reporting pursuant to this section if the Energy Commission determines that it is infeasible or unreasonably costly for retail suppliers to obtain the necessary data or develop the necessary reporting tools within the timeframe established in subdivision (b).
The Energy Commission may verify environmental and procurement claims made by retail suppliers.
ARTICLE 15. Reliable Electric Service Investments Act [399. - 399.9.]
This article shall be known, and may be cited, as the Reliable Electric Service Investments Act.
The Legislature finds and declares that safe, reliable electric service is of utmost importance to the citizens of this state, and its economy.
The Legislature further finds and declares that in order to ensure that the citizens of this state continue to receive safe, reliable, affordable, and environmentally sustainable electric service, it is essential that prudent investments continue to be made in all of the following areas:
To protect the integrity of the electric distribution grid.
To ensure an adequately sized and trained utility workforce.
To ensure cost-effective energy efficiency improvements.
To achieve a sustainable supply of renewable energy.
To advance public interest research, development and demonstration programs not adequately provided by competitive and regulated markets.
It is the intent of the Legislature to reaffirm, without requiring revision, California’s doctrine, as reflected in regulatory and judicial decisions, regarding electrical corporations’ reasonable opportunity to recover costs and investments associated with their electric distribution grid and the reasonable opportunity to attract capital for investment on reasonable terms.
The Legislature further finds and declares all of the following:
Acting under applicable constitutional and statutory authorities, the Public Utilities Commission and the boards of local publicly owned electric utilities have included in regulated electricity prices, investments that are essential to maintaining system reliability, reducing California electricity users’ bills, and mitigating environmental costs of California users’ electricity consumption.
Among the most important of these “system benefits” investments categories are energy efficiency, renewable energy, and public interest research, development and demonstration (RD&D).
Energy efficiency investments funded from California’s usage-based charges on electricity distribution help improve systemwide reliability by reducing demand in times and areas of system congestion, and at the same time reduce all California electricity users’ costs. These investments also significantly reduce environmental costs associated with California’s electricity consumption, including, but not limited to, degradation of the state’s air, water, and land resources.
California’s in-state renewable energy resources help alleviate supply deficits that could threaten electric system reliability, reduce environmental costs associated with California’s electricity consumption, and increase the diversity of the electricity system’s fuel mix, reducing electricity users’ exposure to fossil-fuel price volatility.
California’s public interest RD&D investments enhance private and regulated sector investment in electricity system technologies, and are designed specifically to help ensure sustained improvement in the economic and environmental performance of the distribution, transmission, and generation and end-use systems that serve California electricity users.
California has established a long tradition of recovering system benefits investments through usage-based electricity charges, which is reflected in at least two decades of electricity price regulation by the commission, the boards of local publicly owned electric utilities, and the mandate of the Legislature in Chapter 854 of the Statutes of 1996 (Assembly Bill 1890 of the 1995–96 Regular Session of the Legislature) and Chapter 905 of the Statutes of 1997 (Senate Bill 90 of the 1997–98 Regular Session of the Legislature).
Unless the Legislature acts to extend the mandate of this article for minimum levels of usage based system benefits charges, California electricity users are at substantial risk of higher economic and environmental costs and degraded reliability.
It is the policy of this state, and the intent of the Legislature, to reaffirm that each electrical corporation shall continue to operate its electric distribution grid in its service territory and shall do so in a safe, reliable, efficient, and cost-effective manner.
In furtherance of this policy, it is the intent of the Legislature that each electrical corporation shall continue to be responsible for operating its own electric distribution grid including, but not limited to, owning, controlling, operating, managing, maintaining, planning, engineering, designing, and constructing its own electric distribution grid, emergency response and restoration, service connections, service turnons and turnoffs, and service inquiries relating to the operation of its electric distribution grid, subject to the commission’s authority.
In order to ensure the continued efficient use, and cost-effective, safe, and reliable operation of the electric distribution grid, each electrical corporation shall continue to operate its electric distribution grid in its service territory consistent with Section 330.
In carrying out the purposes of this section, each electrical corporation shall continue to make reasonable investments in its electric distribution grid. Each electrical corporation shall continue to have a reasonable opportunity to fully recover from all customers of the electrical corporation, in a manner determined by the commission pursuant to this code, all of the following:
Reasonable investments in its electric distribution grid.
A reasonable return on the investments in its electric distribution grid.
Reasonable costs to operate its electric distribution grid.
For purposes of this section, the term “electric distribution grid” means those facilities owned or operated by an electrical corporation that are not under the control of the Independent System Operator and that are used to transmit, deliver, or furnish electricity for light, heat, or power.
Nothing in this section shall be construed to alter or to affect any of the following:
The authority of the commission to establish and enforce standards and tariff conditions for the interconnection of customer-owned facilities to the electric distribution grid.
The ratemaking authority of the commission under this code.
The authority of the commission to establish rules governing the extension of service to new customers.
Nothing in this section shall be construed to alter or affect any authority or lack of authority of the commission regarding the ownership and operation of new electric generation used in whole, or in part, for the purpose of maintaining or enhancing the reliability of the electric distribution grid.
Nothing in this section diminishes or expands any existing authority of a local governmental entity.
The commission shall require every electrical corporation operating an electric distribution grid to inform all customers who request residential service connections via telephone of the availability of the California Alternative Rates for Energy (CARE) program and how they may qualify for and obtain these services and shall accept applications for the CARE program according to procedures specified by the commission. Electrical corporations shall recover the reasonable costs of implementing this subdivision.
Notwithstanding Sections 1001 to 1013, inclusive, an application of an electrical corporation for a certificate authorizing the construction of new transmission facilities is necessary to the provision of electric service if the commission finds that the new facility is necessary to facilitate achievement of the renewables portfolio standard established in Article 16 (commencing with Section 399.11).
With respect to a transmission facility described in subdivision (a), the commission shall take all feasible actions to ensure that the transmission rates established by the Federal Energy Regulatory Commission are fully reflected in any retail rates established by the commission. These actions shall include all of the following:
Making findings, where supported by an evidentiary record, that those transmission facilities provide benefit to the transmission network and are necessary to facilitate the achievement of the renewables portfolio standard established in Article 16 (commencing with Section 399.11).
Directing the utility to which the generator will be interconnected, where the direction is not preempted by federal law, to seek the recovery through general transmission rates of the costs associated with the transmission facilities.
Asserting the positions described in paragraphs (1) and (2) to the Federal Energy Regulatory Commission in appropriate proceedings.
Allowing recovery in retail rates of any increase in transmission costs incurred by an electrical corporation resulting from the construction of the transmission facilities that are not approved for recovery in transmission rates by the Federal Energy Regulatory Commission after the commission determines that the costs were prudently incurred.
Any cost recovery pursuant to subdivision (b) or (c) shall be limited to costs that are not approved for recovery in transmission rates by the Federal Energy Regulatory Commission.
Nothing in Section 399.2 shall be construed to preclude any of California’s local publicly owned electric utilities from exercising authority to operate their electric distribution grid as provided under law.
In order to ensure that prudent investments in energy efficiency continue to be made that produce cost-effective energy savings, reduce customer demand, and contribute to the safe and reliable operation of the electrical distribution grid, it is the policy of this state and the intent of the Legislature that the commission shall supervise the administration of cost-effective energy efficiency programs authorized pursuant to its statutory authority, including Sections 381, 381.1, 381.2, 381.5, 382, 384.5, 400, 454.5, 454.55, 454.56, 589, 701.1, 749, and 769, Article 10 (commencing with Section 890) of Chapter 4, and Chapter 6 (commencing with Section 2781) of Part 2.
As used in this section, the term “energy efficiency” includes, but is not limited to, cost-effective activities to achieve peak load reduction that improve end-use efficiency, lower customers’ bills, and reduce system needs.
If a customer or contractor is the recipient of a rebate or incentive offered by a public utility for an energy efficiency improvement or installation of energy efficient components, equipment, or appliances in a building, the public utility shall provide the rebate or incentive only if the customer or contractor certifies that the improvement or installation has complied with any applicable permitting requirements, including any applicable specifications or requirements set forth in the California Building Standards Code (Title 24 of the California Code of Regulations), and, if a contractor performed the installation or improvement, that the contractor holds the appropriate license for the work performed.
In addition to the requirements of paragraph (1), if a customer or contractor is the recipient of a rebate or incentive offered by a public utility for the purchase or installation of central air conditioning or a heat pump, and their related fans, the public utility shall provide the rebate or incentive only if the customer or contractor provides proof of permit closure. The public utility is not responsible for verifying the proof of permit closure documentation provided by the customer or contractor.
This subdivision does not imply or create authority or responsibility, or expand existing authority or responsibility, of a public utility for the enforcement of the building energy and water efficiency standards adopted pursuant to subdivision (a) or (b) of Section 25402 of the Public Resources Code, or appliance efficiency standards and certification requirements adopted pursuant to subdivision (c) of Section 25402 of the Public Resources Code.
This subdivision does not limit the authority of the commission to impose any additional requirements on a recipient of any rebate or incentive.
The commission, in evaluating energy efficiency investments under its statutory authority, shall also ensure that local and regional interests, multifamily dwellings, and energy service industry capabilities are incorporated into program portfolio design and that local governments, community-based organizations, and energy efficiency service providers are encouraged to participate in program implementation where appropriate.
The commission, in a new or existing proceeding, shall review and update its policies governing energy efficiency programs funded by utility customers to facilitate achieving the targets established pursuant to subdivision (c) of Section 25310 of the Public Resources Code. In updating its policies, the commission shall, at a minimum, do all of the following:
In order to ensure that the citizens of this state continue to receive safe, reliable, affordable, and environmentally sustainable electric service, it is the policy of this state and the intent of the Legislature that prudent investments in energy efficiency, renewable energy, and research, development and demonstration shall continue to be made.
Every customer of an electrical corporation shall pay a nonbypassable system benefits charge authorized pursuant to this article. The system benefits charge shall fund energy efficiency, renewable energy, and research, development and demonstration.
Local publicly owned electric utilities shall continue to collect and administer system benefits charges pursuant to Section 385.
The commission shall order San Diego Gas and Electric Company, Southern California Edison Company, and Pacific Gas and Electric Company to collect these funds commencing on January 1, 2002, as follows:
The commission shall ensure that each electrical corporation allocates funds transferred by the Energy Commission pursuant to subdivision (b) of Section 25743 in a manner that maximizes the economic benefit to all customer classes that funded the New Renewable Resources Account.
The commission and the Energy Commission shall retain and continue their oversight responsibilities as set forth in Sections 381 and 383, and Chapter 7.1 (commencing with Section 25620) and Chapter 8.6 (commencing with Section 25740) of Division 15 of the Public Resources Code.
An applicant for the Large Nonresidential Standard Performance Contract Program funded pursuant to paragraph (1) of subdivision (b) and an electrical corporation shall promptly attempt to resolve disputes that arise related to the program’s guidelines and parameters prior to entering into a program agreement. The applicant shall provide the electrical corporation with written notice of any dispute. Within 10 business days after receipt of the notice, the parties shall meet to resolve the dispute. If the dispute is not resolved within 10 business days after the date of the meeting, the electrical corporation shall notify the applicant of his or her right to file a complaint with the commission, which complaint shall describe the grounds for the complaint, injury, and relief sought. The commission shall issue its findings in response to a filed complaint within 30 business days of the date of receipt of the complaint. Prior to issuance of its findings, the commission shall provide a copy of the complaint to the electrical corporation, which shall provide a response to the complaint to the commission within five business days of the date of receipt. During the dispute period, the amount of estimated financial incentives shall be held in reserve until the dispute is resolved.
No part of this article shall be construed to alter or affect the low-income funding provisions set forth in Section 382. Programs provided to low-income electricity customers, including but not limited to, targeted energy efficiency services and the California Alternative Rates for Energy Program shall continue to be funded as set forth in Section 382.
Nothing in this article shall be construed to affect the jurisdiction of the commission over electric distribution service.
ARTICLE 16. California Renewables Portfolio Standard Program [399.11. - 399.33.]
The Legislature finds and declares all of the following:
In order to attain a target of generating 20 percent of total retail sales of electricity in California from eligible renewable energy resources by December 31, 2013, 33 percent by December 31, 2020, 50 percent by December 31, 2026, and 60 percent by December 31, 2030, it is the intent of the Legislature that the commission and the Energy Commission implement the California Renewables Portfolio Standard Program described in this article.
Achieving the renewables portfolio standard through the procurement of various electricity products from eligible renewable energy resources is intended to provide unique benefits to California, including all of the following, each of which independently justifies the program:
Displacing fossil fuel consumption within the state.
Adding new electrical generating facilities in the transmission network within the WECC service area.
Reducing air pollution, particularly criteria pollutant emissions and toxic air contaminants, in the state.
Meeting the state’s climate change goals by reducing emissions of greenhouse gases associated with electrical generation.
Promoting stable retail rates for electric service.
Meeting the state’s need for a diversified and balanced energy generation portfolio.
Assisting with meeting the state’s resource adequacy requirements.
Contributing to the safe and reliable operation of the electrical grid, including providing predictable electrical supply, voltage support, lower line losses, and congestion relief.
Implementing the state’s transmission and land use planning activities related to development of eligible renewable energy resources.
The California Renewables Portfolio Standard Program is intended to complement the Renewable Energy Resources Program administered by the Energy Commission and established pursuant to Chapter 8.6 (commencing with Section 25740) of Division 15 of the Public Resources Code.
New and modified electric transmission facilities may be necessary to facilitate the state achieving its renewables portfolio standard targets.
Supplying electricity to California end-use customers that is generated by eligible renewable energy resources is necessary to improve California’s air quality and public health, particularly in disadvantaged communities identified pursuant to Section 39711 of the Health and Safety Code, and the commission shall ensure rates are just and reasonable, and are not significantly affected by the procurement requirements of this article. This electricity may be generated anywhere in the interconnected grid that includes many states, and areas of both Canada and Mexico.
This article requires generating resources located outside of California that are able to supply that electricity to California end-use customers to be treated identically to generating resources located within the state, without discrimination.
California electrical corporations have already executed, and the commission has approved, power purchase agreements with eligible renewable energy resources located outside of California that will supply electricity to California end-use customers. These resources will fully count toward meeting the renewables portfolio standard procurement requirements.
For purposes of this article, the following terms have the following meanings:
“Conduit hydroelectric facility” means a facility for the generation of electricity that uses only the hydroelectric potential of an existing pipe, ditch, flume, siphon, tunnel, canal, or other manmade conduit that is operated to distribute water for a beneficial use.
“Balancing authority” means the responsible entity that integrates resource plans ahead of time, maintains load-interchange generation balance within a balancing authority area, and supports interconnection frequency in real time.
“Balancing authority area” means the collection of generation, transmission, and loads within the metered boundaries of the area within which the balancing authority maintains the electrical load-resource balance.
“California balancing authority” is a balancing authority with control over a balancing authority area primarily located in this state and operating for retail sellers and local publicly owned electric utilities subject to the requirements of this article and includes the Independent System Operator (ISO) and a local publicly owned electric utility operating a transmission grid that is not under the operational control of the ISO. A California balancing authority is responsible for the operation of the transmission grid within its metered boundaries which is not limited by the political boundaries of the State of California.
“Eligible renewable energy resource” means an electrical generating facility that meets the definition of a “renewable electrical generation facility” in Section 25741 of the Public Resources Code, subject to the following:
An existing small hydroelectric generation facility of 30 megawatts or less shall be eligible only if a retail seller or local publicly owned electric utility procured the electricity from the facility as of December 31, 2005. A new hydroelectric facility that commences generation of electricity after December 31, 2005, is not an eligible renewable energy resource if it will cause an adverse impact on instream beneficial uses or cause a change in the volume or timing of streamflow.
Notwithstanding subparagraph (A), a conduit hydroelectric facility of 30 megawatts or less that commenced operation before January 1, 2006, is an eligible renewable energy resource. A conduit hydroelectric facility of 30 megawatts or less that commences operation after December 31, 2005, is an eligible renewable energy resource so long as it does not cause an adverse impact on instream beneficial uses or cause a change in the volume or timing of streamflow.
A facility approved by the governing board of a local publicly owned electric utility prior to June 1, 2010, for procurement to satisfy renewable energy procurement obligations adopted pursuant to former Section 387, shall be certified as an eligible renewable energy resource by the Energy Commission pursuant to this article, if the facility is a “renewable electrical generation facility” as defined in Section 25741 of the Public Resources Code.
A small hydroelectric generation unit with a nameplate capacity not exceeding 40 megawatts that is operated as part of a water supply or conveyance system is an eligible renewable energy resource only for the retail seller or local publicly owned electric utility that procured the electricity from the unit as of December 31, 2005. No unit shall be eligible pursuant to this subparagraph if an application for certification is submitted to the Energy Commission after January 1, 2013. Only one retail seller or local publicly owned electric utility shall be deemed to have procured electricity from a given unit as of December 31, 2005.
Notwithstanding clause (i), a local publicly owned electric utility that meets the criteria of subdivision (j) of Section 399.30 may sell to another local publicly owned electric utility electricity from small hydroelectric generation units that qualify as eligible renewable energy resources under clause (i), and that electricity may be used by the local publicly owned electric utility that purchased the electricity to meet its renewables portfolio standard procurement requirements. The total of all those sales from the utility shall be no greater than 100,000 megawatthours of electricity.
The amendments made to this subdivision by the act adding this subparagraph are intended to clarify existing law and apply from December 10, 2011.
A facility engaged in the combustion of municipal solid waste shall not be considered an eligible renewable energy resource.
Subparagraph (A) does not apply to generation before January 1, 2017, from a facility located in Stanislaus County that was operational prior to September 26, 1996.
“Procure” means to acquire through ownership or contract.
“Procurement entity” means any person or corporation authorized by the commission to enter into contracts to procure eligible renewable energy resources on behalf of customers of a retail seller pursuant to subdivision (f) of Section 399.13.
“Renewable energy credit” means a certificate of proof associated with the generation of electricity from an eligible renewable energy resource, issued through the accounting system established by the Energy Commission pursuant to Section 399.25, that one unit of electricity was generated and delivered by an eligible renewable energy resource.
“Renewable energy credit” includes all renewable and environmental attributes associated with the production of electricity from the eligible renewable energy resource, except for an emissions reduction credit issued pursuant to Section 40709 of the Health and Safety Code and any credits or payments associated with the reduction of solid waste and treatment benefits created by the utilization of biomass or biogas fuels.
Electricity generated by an eligible renewable energy resource attributable to the use of nonrenewable fuels, beyond a de minimis quantity used to generate electricity in the same process through which the facility converts renewable fuel to electricity, shall not result in the creation of a renewable energy credit. The Energy Commission shall set the de minimis quantity of nonrenewable fuels for each renewable energy technology at a level of no more than 2 percent of the total quantity of fuel used by the technology to generate electricity. The Energy Commission may adjust the de minimis quantity for an individual facility, up to a maximum of 5 percent, if it finds that all of the following conditions are met:
The facility demonstrates that the higher quantity of nonrenewable fuel will lead to an increase in generation from the eligible renewable energy facility that is significantly greater than generation from the nonrenewable fuel alone.
The facility demonstrates that the higher quantity of nonrenewable fuels will reduce the variability of its electrical output in a manner that results in net environmental benefits to the state.
The higher quantity of nonrenewable fuel is limited to either natural gas or hydrogen derived by reformation of a fossil fuel.
Electricity generated by a small hydroelectric generation facility shall not result in the creation of a renewable energy credit unless the facility meets the requirements of subparagraph (A) or (D) of paragraph (1) of subdivision (e).
Electricity generated by a conduit hydroelectric generation facility shall not result in the creation of a renewable energy credit unless the facility meets the requirements of subparagraph (B) of paragraph (1) of subdivision (e).
Electricity generated by a facility engaged in the combustion of municipal solid waste shall not result in the creation of a renewable energy credit. This subparagraph does not apply to renewable energy credits that were generated before January 1, 2017, by a facility engaged in the combustion of municipal solid waste located in Stanislaus County that was operational prior to September 26, 1996, and sold pursuant to contacts entered into before January 1, 2017.
“Renewables portfolio standard” means the specified percentage of electricity generated by eligible renewable energy resources that a retail seller or a local publicly owned electric utility is required to procure pursuant to this article.
“Retail seller” means an entity engaged in the retail sale of electricity to end-use customers located within the state, including any of the following:
An electrical corporation, as defined in Section 218.
A community choice aggregator. A community choice aggregator shall participate in the renewables portfolio standard program subject to the same terms and conditions applicable to an electrical corporation.
An electric service provider, as defined in Section 218.3. The electric service provider shall be subject to the same terms and conditions applicable to an electrical corporation pursuant to this article. This paragraph does not impair a contract entered into between an electric service provider and a retail customer prior to the suspension of direct access by the commission pursuant to Section 80110 of the Water Code.
“Retail seller” does not include any of the following:
A corporation or person employing cogeneration technology or producing electricity consistent with subdivision (b) of Section 218.
The Department of Water Resources acting in its capacity pursuant to Division 27 (commencing with Section 80000) of the Water Code.
A local publicly owned electric utility.
“WECC” means the Western Electricity Coordinating Council of the North American Electric Reliability Corporation, or a successor to the corporation.
Notwithstanding subdivision (e) of Section 399.12, a small hydroelectric generation facility that satisfies the criteria for an eligible renewable energy resource pursuant to Section 399.12 shall not lose its eligibility if efficiency improvements undertaken after January 1, 2008, cause the generating capacity of the facility to exceed 30 megawatts, and the efficiency improvements do not result in an adverse impact on instream beneficial uses or cause a change in the volume or timing of streamflow. The entire generating capacity of the facility shall be eligible.
Notwithstanding subdivision (e) of Section 399.12, the incremental increase in the amount of electricity generated from a hydroelectric generation facility as a result of efficiency improvements at the facility, is electricity from an eligible renewable energy resource, without regard to the electrical output of the facility, if all of the following conditions are met:
The incremental increase is the result of efficiency improvements from a retrofit that do not result in an adverse impact on instream beneficial uses or cause a change in the volume or timing of streamflow.
The hydroelectric generation facility meets one of the following certification mechanisms:
The hydroelectric generation facility has, within the immediately preceding 15 years, received certification from the State Water Resources Control Board pursuant to Section 401 of the federal Clean Water Act (33 U.S.C. Sec. 1341), or has received certification from a regional board to which the state board has delegated authority to issue certification, unless the facility is not subject to certification because there is no potential for discharge into waters of the United States.
If the hydroelectric facility is not located in California, the certification pursuant to Section 401 of the federal Clean Water Act (33 U.S.C. Sec. 1341) may be received from the applicable state board or agency or from a regional board to which the state board has delegated authority to issue the certification.
If the hydroelectric generation facility is the Rock Creek Powerhouse, Federal Energy Regulatory Commission Project Number 1962, the efficiency improvements have received any necessary incremental certification from the State Water Resources Control Board.
The hydroelectric generation facility is owned by a retail seller or a local publicly owned electric utility, was operational prior to January 1, 2007, the efficiency improvements are initiated on or after January 1, 2008, the efficiency improvements are not the result of routine maintenance activities, as determined by the Energy Commission, and the efficiency improvements were not included in any resource plan sponsored by the facility owner prior to January 1, 2008.
All of the incremental increase in electricity resulting from the efficiency improvements are demonstrated to result from a long-term financial commitment by the retail seller or local publicly owned electric utility. For purposes of this paragraph, “long-term financial commitment” means either new ownership investment in the facility by the retail seller or local publicly owned electric utility or a new or renewed contract with a term of 10 or more years, which includes procurement of the incremental generation.
The incremental increase in the amount of electricity generated from a hydroelectric generation facility as a result of efficiency improvements at the facility are not eligible for supplemental energy payments pursuant to the Renewable Energy Resources Program (Chapter 8.6 (commencing with Section 25740) of Division 15 of the Public Resources Code), or a successor program.
Notwithstanding subdivision (e) of Section 399.12 and subdivisions (a) and (b), a hydroelectric generation facility that is an eligible renewable energy resource pursuant to this article as of January 1, 2010, shall not lose its eligibility if the facility causes a change in the volume or timing of streamflow required by license conditions approved pursuant to the Federal Power Act (Chapter 12 (commencing with Section 791a) of Title 16 of the United States Code) on or after January 1, 2010.
Any procurement of biomethane delivered through a common carrier pipeline under a contract executed by a retail seller or local publicly owned electric utility and reported to the Energy Commission prior to March 29, 2012, and otherwise eligible under the rules in place as of the date of contract execution shall count toward the procurement requirements established in this article, under the rules in place at the time the contract was executed, including the Fourth Edition of the Energy Commission’s Renewables Portfolio Standard Eligibility Guidebook, provided that those rules shall apply only to sources that are producing biomethane and injecting it into a common carrier pipeline on or before April 1, 2014.
The eligibility requirements of subdivision (b) shall apply beginning March 29, 2012, to any quantities of biomethane associated with any of the following:
An extension of the term of the original contract.
Any quantity of biomethane that exceeds the quantities of biomethane specified in the original contract.
Any optional quantities of biomethane that can be exercised at the discretion of the buyer.
Any change in the source or sources of biomethane identified in the original contract or the original application for certification submitted to the Energy Commission.
Any quantity of biomethane from a source not producing and capturing biomethane and injecting it into a common carrier pipeline on or before April 1, 2014.
The conditions of this paragraph shall apply beginning March 29, 2012.
For contracts initially executed on or after March 29, 2012, or for quantities of biomethane associated with contract amendments executed on or after March 29, 2012, the use of biomethane by a generating facility shall not qualify as an eligible renewable energy resource unless it satisfies all applicable requirements established by the Energy Commission and meets any of the following requirements:
The biomethane is used by an onsite generating facility.
The biomethane is used by an offsite generating facility and delivered to the generating facility through a dedicated pipeline.
The biomethane is delivered to a generating facility through a common carrier pipeline and meets all of the following requirements:
The source of biomethane injects the biomethane into a common carrier pipeline that physically flows within California or toward the generating facility for which the biomethane was procured under the original contract.
The source of biomethane did not inject biomethane into a common carrier pipeline prior to March 29, 2012, or the source commenced injection of sufficient incremental quantities of biomethane after March 29, 2012, to satisfy the contract requirements.
The seller or purchaser of the biomethane demonstrates that the capture and injection of biomethane into a common carrier pipeline directly results in at least one of the following environmental benefits to California:
The reduction or avoidance of the emission of any criteria air pollutant in California.
The reduction or avoidance of pollutants that could have an adverse impact on waters of the state.
The alleviation of a local nuisance within California that is associated with the emission of odors.
For all electricity products generated using biomethane that are credited toward the renewables portfolio standard procurement obligations established pursuant to this article, sufficient renewable and environmental attributes of biomethane production and capture shall be transferred to the retail seller or local publicly owned electric utility that uses that biomethane to ensure that there are zero net emissions associated with the production of electricity from the generating facility using the biomethane. The provisions of this subdivision shall be applied in a manner consistent with the definition of “green attributes” as specified by the commission in Decision 08-08-028, Decision on Definition and Attributes of Renewable Energy Credits for Compliance with the California Renewables Portfolio Standard (August 21, 2008), as may be modified by subsequent decision of the commission.
All sellers and purchasers of biomethane shall comply with a system for tracking and verifying the use of biomethane, as established by the Energy Commission, that is equivalent to the system required by subdivision (c) of Section 399.25.
For contracts initially executed on or after March 29, 2012, or for quantities of biomethane associated with contract amendments executed after March 29, 2012, the use of biomethane shall be assigned to the appropriate portfolio content category based on the application of the criteria in subdivision (b) of Section 399.16 to the procurement of electricity by the retail seller or local publicly owned electric utility from the generating facility consuming the biomethane.
A retail seller, local publicly owned electric utility, or an intermediary party to a biomethane procurement contract shall not make a marketing, regulatory, or retail claim that asserts that a biomethane procurement contract to which that entity was a party resulted, or will result, in greenhouse gas reductions related to the destruction of methane if the capture and destruction is required by law. If the capture and destruction of the biomethane is not required by law, a retail seller, local publicly owned electric utility, or an intermediary party to a biomethane procurement contract shall not make a marketing, regulatory, or retail claim that asserts that a biomethane procurement contract to which that entity was a party resulted, or will result, in greenhouse gas reductions related to the destruction of methane, unless the environmental attributes associated with the capture and destruction of the biomethane pursuant to that contract are transferred to the retail seller or publicly owned electric utility that purchased that biomethane and retired on behalf of the retail customers consuming the electricity associated with the use of that biomethane, or unless the biomethane procurement contract prohibits the source of biomethane from separately marketing the environmental attributes associated with the capture and destruction of the biomethane sold pursuant to that contract. These attributes shall be retired and may not be resold.
For the purposes of this section, “biomethane” means landfill gas or digester gas, consistent with Section 25741 of the Public Resources Code.
If any provision of this section or the application of any provision of this section is held invalid, biomethane delivered through a common carrier pipeline pursuant to a contract executed within 180 days of, or at any time subsequent to, the invalidation of that provision shall not qualify as an eligible renewable energy resource.
The commission shall direct each electrical corporation to annually prepare a renewable energy procurement plan that includes the elements specified in paragraph (6), to satisfy its obligations under the renewables portfolio standard. To the extent feasible, this procurement plan shall be proposed, reviewed, and adopted by the commission as part of, and pursuant to, a general procurement plan process. The commission shall require each electrical corporation to review and update its renewable energy procurement plan as it determines to be necessary. The commission shall require all other retail sellers to prepare and submit renewable energy procurement plans that address the requirements identified in paragraph (6).
Every electrical corporation that owns electrical transmission facilities shall annually prepare, as part of the Federal Energy Regulatory Commission Order 890 process, and submit to the commission, a report identifying any electrical transmission facility, upgrade, or enhancement that is reasonably necessary to achieve the renewables portfolio standard procurement requirements of this article. Each report shall look forward at least five years and, to ensure that adequate investments are made in a timely manner, shall include a preliminary schedule when an application for a certificate of public convenience and necessity will be made, pursuant to Chapter 5 (commencing with Section 1001), for any electrical transmission facility identified as being reasonably necessary to achieve the renewable energy resources procurement requirements of this article. Each electrical corporation that owns electrical transmission facilities shall ensure that project-specific interconnection studies are completed in a timely manner.
Each electrical corporation that owns electrical transmission facilities shall annually prepare, and submit to the commission, a report on any changes to previously reported in-service dates of transmission and interconnection facilities necessary to provide transmission deliverability to eligible renewable energy resources or energy storage resources that have executed interconnection agreements. The report shall be provided concurrently with each electrical corporation’s annual renewable energy procurement plan and identify the reason for any changes to the status of in-service dates.
The commission shall direct each retail seller to prepare and submit an annual compliance report that includes all of the following:
The current status and progress made during the prior year toward procurement of eligible renewable energy resources as a percentage of retail sales, including, if applicable, the status of any necessary siting and permitting approvals from federal, state, and local agencies for those eligible renewable energy resources procured by the retail seller, and the current status of compliance with the portfolio content requirements of subdivision (c) of Section 399.16, including procurement of eligible renewable energy resources located outside the state and within the WECC and unbundled renewable energy credits.
If the retail seller is an electrical corporation, the current status and progress made during the prior year toward construction of, and upgrades to, transmission and distribution facilities and other electrical system components it owns to interconnect eligible renewable energy resources and to supply the electricity generated by those resources to load, including the status of planning, siting, and permitting transmission facilities by federal, state, and local agencies.
Recommendations to remove impediments to making progress toward achieving the renewable energy resources procurement requirements established pursuant to this article.
The commission shall review each annual compliance report filed by a retail seller. The commission shall notify a retail seller if the commission has determined, based upon its review, that the retail seller may be at risk of not satisfying the renewable energy procurement requirements for the then-current or a future compliance period and shall provide recommendations in that circumstance regarding satisfying those requirements.
The commission shall adopt, by rulemaking, all of the following:
A process that provides criteria for the rank ordering and selection of least-cost and best-fit eligible renewable energy resources to comply with the California Renewables Portfolio Standard Program obligations on a total cost and best-fit basis. This process shall take into account all of the following:
Estimates of indirect costs associated with needed transmission investments.
The cost impact of procuring the eligible renewable energy resources on the electrical corporation’s electricity portfolio.
The viability of the project to construct and reliably operate the eligible renewable energy resource, including the developer’s experience, the feasibility of the technology used to generate electricity, and the risk that the facility will not be built, or that construction will be delayed, with the result that electricity will not be supplied as required by the contract.
Workforce recruitment, training, and retention efforts, including the employment growth associated with the construction and operation of eligible renewable energy resources and goals for recruitment and training of women, minorities, and disabled veterans.
Estimates of electrical corporation expenses resulting from integrating and operating eligible renewable energy resources, including, but not limited to, any additional wholesale energy and capacity costs associated with integrating each eligible renewable resource.
(II) No later than December 31, 2015, the commission shall approve a methodology for determining the integration costs described in subclause (I).
Consideration of any statewide greenhouse gas emissions limit established pursuant to the California Global Warming Solutions Act of 2006 (Division 25.5 (commencing with Section 38500) of the Health and Safety Code).
Consideration of capacity and system reliability of the eligible renewable energy resource to ensure grid reliability.
Rules permitting retail sellers to accumulate, beginning January 1, 2011, excess procurement in one compliance period to be applied to any subsequent compliance period. The rules shall apply equally to all retail sellers. In determining the quantity of excess procurement for the applicable compliance period, the commission shall retain the rules adopted by the commission and in effect as of January 1, 2015, for the compliance period specified in subparagraphs (A) to (C), inclusive, of paragraph (1) of subdivision (b) of Section 399.15. For any subsequent compliance period, the rules shall allow the following:
For electricity products meeting the portfolio content requirements of paragraph (1) of subdivision (b) of Section 399.16, contracts of any duration may count as excess procurement.
Electricity products meeting the portfolio content requirements of paragraph (2) or (3) of subdivision (b) of Section 399.16 shall not be counted as excess procurement. Contracts of any duration for electricity products meeting the portfolio content requirements of paragraph (2) or (3) of subdivision (b) of Section 399.16 that are credited towards a compliance period shall not be deducted from a retail seller’s procurement for purposes of calculating excess procurement.
If a retail seller notifies the commission that it will comply with the provisions of subdivision (b) for the compliance period beginning January 1, 2017, the provisions of clauses (i) and (ii) shall take effect for that retail seller for that compliance period.
Standard terms and conditions to be used by all electrical corporations in contracting for eligible renewable energy resources, including performance requirements for renewable generators. A contract for the purchase of electricity generated by an eligible renewable energy resource, at a minimum, shall include the renewable energy credits associated with all electricity generation specified under the contract. The standard terms and conditions shall include the requirement that, no later than six months after the commission’s approval of an electricity purchase agreement entered into pursuant to this article, the following information about the agreement shall be disclosed by the commission: party names, resource type, project location, and project capacity.
An appropriate minimum margin of procurement above the minimum procurement level necessary to comply with the renewables portfolio standard to mitigate the risk that renewable projects planned or under contract are delayed or canceled. This paragraph does not preclude an electrical corporation from voluntarily proposing a margin of procurement above the appropriate minimum margin established by the commission.
Consistent with the goal of increasing California’s reliance on eligible renewable energy resources, the renewable energy procurement plan shall include all of the following:
An assessment of annual or multiyear portfolio supplies and demand to determine the optimal mix of eligible renewable energy resources with deliverability characteristics that may include peaking, dispatchable, baseload, firm, and as-available capacity.
Potential compliance delays related to the conditions described in paragraph (5) of subdivision (b) of Section 399.15.
A bid solicitation setting forth the need for eligible renewable energy resources of each deliverability characteristic, required online dates, and locational preferences, if any.
A status update on the development schedule of all eligible renewable energy resources currently under contract.
Consideration of mechanisms for price adjustments associated with the costs of key components for eligible renewable energy resource projects with online dates more than 24 months after the date of contract execution.
An assessment of the risk that an eligible renewable energy resource will not be built, or that construction will be delayed, with the result that electricity will not be delivered as required by the contract.
In soliciting and procuring eligible renewable energy resources, each electrical corporation shall offer contracts of no less than 10 years duration, unless the commission approves of a contract of shorter duration.
In soliciting and procuring eligible renewable energy resources for California-based projects, each electrical corporation shall give preference to renewable energy projects that provide environmental and economic benefits to communities afflicted with poverty or high unemployment, or that suffer from high emission levels of toxic air contaminants, criteria air pollutants, and greenhouse gases.
Subparagraph (A) applies to all procurement of eligible renewable energy resources for California-based projects, whether the procurement occurs through all-source requests for offers, eligible renewable resources only requests for offers, or other procurement mechanisms. This subparagraph is declaratory of existing law.
In soliciting and procuring eligible renewable energy resources, each retail seller shall consider the best-fit attributes of resource types that ensure a balanced resource mix to maintain the reliability of the electrical grid.
A retail seller may enter into a combination of long- and short-term contracts for electricity and associated renewable energy credits. Beginning January 1, 2021, at least 65 percent of the procurement a retail seller counts toward the renewables portfolio standard requirement of each compliance period shall be from its contracts of 10 years or more in duration or in its ownership or ownership agreements for eligible renewable energy resources.
In demonstrating compliance with paragraph (1), a retail seller may rely on contracts of 10 years or more in duration or ownership agreements entered into before January 1, 2019, directly by its direct access, as described in Section 365.1, nonprofit educational institution end-use customer for eligible renewable energy resources located in front of the customer meter to satisfy the portion of the compliance requirement attributable to the retail sales to that end-use customer. A retail seller shall furnish to the commission documentation deemed necessary by the commission to verify compliance with this paragraph.
The commission shall review and accept, modify, or reject each electrical corporation’s renewable energy resource procurement plan prior to the commencement of renewable energy procurement pursuant to this article by an electrical corporation. The commission shall assess adherence to the approved renewable energy resource procurement plans in determining compliance with the obligations of this article.
Unless previously preapproved by the commission, an electrical corporation shall submit a contract for the generation of an eligible renewable energy resource to the commission for review and approval consistent with an approved renewable energy resource procurement plan. If the commission determines that the bid prices are elevated due to a lack of effective competition among the bidders, the commission shall direct the electrical corporation to renegotiate the contracts or conduct a new solicitation.
If an electrical corporation fails to comply with a commission order adopting a renewable energy resource procurement plan, the commission shall exercise its authority to require compliance.
The commission may authorize a procurement entity to enter into contracts on behalf of customers of a retail seller for electricity products from eligible renewable energy resources to satisfy the retail seller’s renewables portfolio standard procurement requirements. The commission shall not require any person or corporation to act as a procurement entity or require any party to purchase eligible renewable energy resources from a procurement entity.
Subject to review and approval by the commission, the procurement entity shall be permitted to recover reasonable administrative and procurement costs through the retail rates of end-use customers that are served by the procurement entity and are directly benefiting from the procurement of eligible renewable energy resources.
Procurement and administrative costs associated with contracts entered into by an electrical corporation for eligible renewable energy resources pursuant to this article and approved by the commission are reasonable and prudent and shall be recoverable in rates.
An electrical corporation, pursuant to Chapter 5 (commencing with Section 1001), and in order to meet its unmet renewables portfolio standard procurement requirements, may apply to the commission for approval to construct, own, and operate an eligible renewable energy resource.
If the proposed eligible renewable energy resource complies with the requirements of subdivision (b), the commission shall approve an application filed pursuant to paragraph (1), until the commission has approved applications for eligible renewable energy resources for the electrical corporation that, when constructed and operating, will provide 8.25 percent of the electrical corporation’s anticipated retail sales by December 31, 2020, and thereafter.
The commission may approve additional applications for eligible renewable energy resources once the commission has approved sufficient applications for eligible renewable energy resources for the electrical corporation that, when constructed and operating, will provide 8.25 percent of the electrical corporation’s anticipated retail sales by December 31, 2020, and thereafter.
The commission shall not approve any application by an electrical corporation pursuant to subdivision (a) unless both of the following conditions are met:
The eligible renewable energy resource utilizes a viable technology at a reasonable cost.
The eligible renewable energy resource provides comparable or superior value to ratepayers when compared to then recent contracts for generation provided by eligible renewable energy resources.
In approving any application by an electrical corporation for approval to construct, own, and operate an eligible renewable energy resource, the commission shall apply traditional cost-of-service ratemaking. When applying traditional cost-of-service ratemaking, the commission, in the certificate authorizing the new construction, shall specify the maximum cost determined to be reasonable and prudent for the construction of the facility and the cost of initial operation of the facility. Upon a filing by the electrical corporation, the commission may authorize an increase in the maximum cost of construction if it determines that the cost has in fact increased, that the cost increase is determined to be reasonable and prudent, and that the present or future public convenience or necessity require construction of the project at the increased cost.
In order to fulfill unmet long-term resource needs, the commission shall establish a renewables portfolio standard requiring all retail sellers to procure a minimum quantity of electricity products from eligible renewable energy resources as a specified percentage of total kilowatthours sold to their retail end-use customers each compliance period to achieve the targets established under this article. For any retail seller procuring at least 14 percent of retail sales from eligible renewable energy resources in 2010, the deficits associated with any previous renewables portfolio standard shall not be added to any procurement requirement pursuant to this article.
The commission shall implement renewables portfolio standard procurement requirements only as follows:
Each retail seller shall procure a minimum quantity of eligible renewable energy resources for each of the following compliance periods:
January 1, 2011, to December 31, 2013, inclusive.
January 1, 2014, to December 31, 2016, inclusive.
January 1, 2017, to December 31, 2020, inclusive.
January 1, 2021, to December 31, 2024, inclusive.
January 1, 2025, to December 31, 2027, inclusive.
January 1, 2028, to December 31, 2030, inclusive.
No later than January 1, 2017, the commission shall establish the quantity of electricity products from eligible renewable energy resources to be procured by the retail seller for each compliance period. These quantities shall be established in the same manner for all retail sellers and result in the same percentages used to establish compliance period quantities for all retail sellers.
In establishing quantities for the compliance period from January 1, 2011, to December 31, 2013, inclusive, the commission shall require procurement for each retail seller equal to an average of 20 percent of retail sales. For the following compliance periods, the quantities shall reflect reasonable progress in each of the intervening years sufficient to ensure that the procurement of electricity products from eligible renewable energy resources achieves 25 percent of retail sales by December 31, 2016, 33 percent by December 31, 2020, 44 percent by December 31, 2024, 52 percent by December 31, 2027, and 60 percent by December 31, 2030. The commission shall establish appropriate three-year compliance periods for all subsequent years that require retail sellers to procure not less than 60 percent of retail sales of electricity products from eligible renewable energy resources.
Retail sellers shall be obligated to procure no less than the quantities associated with all intervening years by the end of each compliance period. Retail sellers shall not be required to demonstrate a specific quantity of procurement for any individual intervening year.
The commission may require the procurement of eligible renewable energy resources in excess of the quantities specified in paragraph (2).
Only for purposes of establishing the renewables portfolio standard procurement requirements of paragraph (1) and determining the quantities pursuant to paragraph (2), the commission shall include all electricity sold to retail customers by the Department of Water Resources pursuant to Division 27 (commencing with Section 80000) of the Water Code in the calculation of retail sales by an electrical corporation.
The commission shall waive enforcement of this section if it finds that the retail seller has demonstrated any of the following conditions are beyond the control of the retail seller and will prevent compliance:
There is inadequate transmission capacity to allow for sufficient electricity to be delivered from proposed eligible renewable energy resource projects using the current operational protocols of the Independent System Operator. In making its findings relative to the existence of this condition with respect to a retail seller that owns transmission lines, the commission shall consider both of the following:
Whether the retail seller has undertaken, in a timely fashion, reasonable measures under its control and consistent with its obligations under local, state, and federal laws and regulations, to develop and construct new transmission lines or upgrades to existing lines intended to transmit electricity generated by eligible renewable energy resources. In determining the reasonableness of a retail seller’s actions, the commission shall consider the retail seller’s expectations for full-cost recovery for these transmission lines and upgrades.
Whether the retail seller has taken all reasonable operational measures to maximize cost-effective deliveries of electricity from eligible renewable energy resources in advance of transmission availability.
Permitting, interconnection, or other circumstances that delay procured eligible renewable energy resource projects, or there is an insufficient supply of eligible renewable energy resources available to the retail seller. In making a finding that this condition prevents timely compliance, the commission shall consider whether the retail seller has done all of the following:
Prudently managed portfolio risks, including relying on a sufficient number of viable projects.
Sought to develop one of the following: its own eligible renewable energy resources, transmission to interconnect to eligible renewable energy resources, or energy storage used to integrate eligible renewable energy resources. This clause shall not require an electrical corporation to pursue development of eligible renewable energy resources pursuant to Section 399.14.
Procured an appropriate minimum margin of procurement above the minimum procurement level necessary to comply with the renewables portfolio standard to compensate for foreseeable delays or insufficient supply.
Taken reasonable measures, under the control of the retail seller, to procure cost-effective distributed generation and allowable unbundled renewable energy credits.
Unanticipated curtailment of eligible renewable energy resources if the waiver would not result in an increase in greenhouse gas emissions.
Unanticipated increase in retail sales due to transportation electrification. In making a finding that this condition prevents timely compliance, the commission shall consider both of the following:
Whether transportation electrification significantly exceeded forecasts in that retail seller’s service territory based on the best and most recently available information filed with the State Air Resources Board, the Energy Commission, or another state agency.
Whether the retail seller has taken reasonable measures to procure sufficient resources to account for unanticipated increases in retail sales due to transportation electrification.
If the commission waives the compliance requirements of this section, the commission shall establish additional reporting requirements on the retail seller to demonstrate that all reasonable actions under the control of the retail seller are taken in each of the intervening years sufficient to satisfy future procurement requirements.
The commission shall not waive enforcement pursuant to this section, unless the retail seller demonstrates that it has taken all reasonable actions under its control, as set forth in paragraph (5), to achieve full compliance.
If a retail seller fails to procure sufficient eligible renewable energy resources to comply with a procurement requirement pursuant to paragraphs (1) and (2) and fails to obtain an order from the commission waiving enforcement pursuant to paragraph (5), the commission shall assess penalties for noncompliance. A schedule of penalties shall be adopted by the commission that shall be comparable for electrical corporations and other retail sellers. For electrical corporations, the cost of any penalties shall not be collected in rates. Any penalties collected under this article shall be deposited into the Electric Program Investment Charge Fund and used for the purposes described in Chapter 8.1 (commencing with Section 25710) of Division 15 of the Public Resources Code.
Deficits associated with the compliance period shall not be added to a future compliance period.
The commission shall establish a limitation for each electrical corporation on the procurement expenditures for all eligible renewable energy resources used to comply with the renewables portfolio standard. This limitation shall be set at a level that prevents disproportionate rate impacts.
If the cost limitation for an electrical corporation is insufficient to support the projected costs of meeting the renewables portfolio standard procurement requirements, the electrical corporation may refrain from entering into new contracts or constructing facilities beyond the quantity that can be procured within the limitation, unless eligible renewable energy resources can be procured without exceeding a de minimis increase in rates, consistent with the long-term procurement plan established for the electrical corporation pursuant to Section 454.5.
The commission shall monitor the status of the cost limitation for each electrical corporation in order to ensure compliance with this article.
If the commission determines that an electrical corporation may exceed its cost limitation prior to achieving the renewables portfolio standard procurement requirements, the commission shall do both of the following within 60 days of making that determination:
Investigate and identify the reasons why the electrical corporation may exceed its annual cost limitation.
Notify the appropriate policy and fiscal committees of the Legislature that the electrical corporation may exceed its cost limitation, and include the reasons why the electrical corporation may exceed its cost limitation.
The establishment of a renewables portfolio standard shall not constitute implementation by the commission of the federal Public Utility Regulatory Policies Act of 1978 (Public Law 95-617).
Various electricity products from eligible renewable energy resources located within the WECC transmission network service area shall be eligible to comply with the renewables portfolio standard procurement requirements in Section 399.15. These electricity products may be differentiated by their impacts on the operation of the grid in supplying electricity, as well as meeting the requirements of this article.
Consistent with the goals of procuring the least-cost and best-fit electricity products from eligible renewable energy resources that meet project viability principles adopted by the commission pursuant to paragraph (5) of subdivision (a) of Section 399.13 and that provide the benefits set forth in Section 399.11, a balanced portfolio of eligible renewable energy resources shall be procured consisting of the following portfolio content categories:
Eligible renewable energy resource electricity products that meet either of the following criteria:
Have a first point of interconnection with a California balancing authority, have a first point of interconnection with distribution facilities used to serve end users within a California balancing authority area, or are scheduled from the eligible renewable energy resource into a California balancing authority without substituting electricity from another source. The use of another source to provide real-time ancillary services required to maintain an hourly or subhourly import schedule into a California balancing authority shall be permitted, but only the fraction of the schedule actually generated by the eligible renewable energy resource shall count toward this portfolio content category.
Have an agreement to dynamically transfer electricity to a California balancing authority.
Firmed and shaped eligible renewable energy resource electricity products providing incremental electricity and scheduled into a California balancing authority.
Eligible renewable energy resource electricity products, or any fraction of the electricity generated, including unbundled renewable energy credits, that do not qualify under the criteria of paragraph (1) or (2).
In order to achieve a balanced portfolio, all retail sellers shall meet the following requirements for all procurement credited toward each compliance period:
For purposes of electric service providers only, the restrictions in this subdivision on crediting eligible renewable energy resource electricity products to each compliance period shall apply to contracts executed after January 13, 2011.
Any contract or ownership agreement originally executed prior to June 1, 2010, shall count in full toward the procurement requirements established pursuant to this article, if all of the following conditions are met:
A retail seller may apply to the commission for a reduction of a procurement content requirement of subdivision (c). The commission may reduce a procurement content requirement of subdivision (c) to the extent the retail seller demonstrates that it cannot comply with that subdivision because of conditions beyond the control of the retail seller as provided in paragraph (5) of subdivision (b) of Section 399.15. The commission shall not, under any circumstance, reduce the obligation specified in paragraph (1) of subdivision (c) below 65 percent for any compliance period obligation after December 31, 2016.
The commission and the Energy Commission shall coordinate to revise any relevant rules, regulations, or guidance to ensure that the transition to a regional energy market governed by the Independent System Operator or the independent regional organization described in Section 345.6 does not expand the types of transactions that meet the portfolio content category requirements of paragraph (1) of subdivision (b) of Section 399.16, as compared to the transactions that would meet those requirements on December 31, 2025.
Subject to this section, the requirements of this article apply to an electrical corporation that as of January 1, 2010, had 60,000 or fewer customer accounts in California and met either of the following requirements:
Served retail end-use customers outside California.
Was located in a control area that is not under the operational balancing authority of the Independent System Operator or other California balancing authority and receives the majority of its electrical requirements from generating facilities located outside of California.
This section applies to a successor entity to all or a portion of the service territory of an electrical corporation meeting the requirements of paragraph (1), but only to the extent that the successor entity will have 60,000 or fewer customer accounts in California.
For an electrical corporation or qualifying successor entity meeting the requirements of subdivision (a), electricity products from eligible renewable energy resources may be used for compliance with the renewables portfolio standard procurement requirements notwithstanding any procurement content limitation in Section 399.16 and an eligible renewable energy resource includes a facility that is located outside California, if the facility is connected to the WECC transmission system, provided all of the following conditions are met:
Any portion of the electricity generated by the facility and allocated by the electrical corporation or qualifying successor entity for its California customers, and is not used to fulfill renewable energy procurement requirements in other states.
The electrical corporation or qualifying successor entity participates in, and complies with, the accounting system administered by the Energy Commission pursuant to subdivision (b) of Section 399.25.
The Energy Commission verifies that the electricity generated by the facility is eligible to meet the procurement requirements of this article.
The commission shall determine the procurement requirements for an electrical corporation or qualifying successor entity meeting the requirements of subdivision (a) as a specified percentage of total kilowatthours sold by the electrical corporation to its retail end-use customers in California in a compliance period.
An electrical corporation or qualifying successor entity meeting the requirements of subdivision (a) may use an integrated resource plan prepared in compliance with the requirements of another state utility regulatory commission, to fulfill the requirement to prepare a renewable energy procurement plan pursuant to this article, provided the plan meets the requirements of Sections 399.13, 399.14, and 399.25, as modified by this section.
Procurement and administrative costs associated with long-term contracts for eligible renewable energy resources pursuant to this article entered into by an electrical corporation or qualifying successor entity meeting the requirements of subdivision (a) and approved by the commission, are reasonable and prudent and shall be recoverable in rates of the electrical corporation or its successor’s California customers, provided the costs are not recoverable in rates in other states served by the electrical corporation.
Procurement expenditures for electricity products from eligible renewable energy resources pursuant to this section by an electrical corporation or successor entity meeting the requirements of subdivision (a) shall be subject to a limitation on procurement expenditures established by the commission pursuant to subdivision (c) of Section 399.15.
This section applies to an electrical corporation that as of January 1, 2010, met either of the following conditions:
Served 30,000 or fewer customer accounts in California and had issued at least four solicitations for eligible renewable energy resources prior to June 1, 2010.
Had 1,000 or fewer customer accounts in California and was not connected to any transmission system or to the Independent System Operator.
For an electrical corporation or its successor, electricity products from eligible renewable energy resources may be used for compliance with this article, notwithstanding any procurement content limitation in Section 399.16, provided that all of the following conditions are met:
The electrical corporation or its successor participates in, and complies with, the accounting system administered by the Energy Commission pursuant to subdivision (b) of Section 399.25.
The Energy Commission verifies that the electricity generated by the facility is eligible to meet the requirements of Section 399.15.
The electrical corporation continues to satisfy either of the conditions described in subdivision (a).
The commission shall modify, and extend until December 31, 2026, or until all available program funds are expended, whichever occurs first, the monetary incentive program for biomethane projects adopted in Decision 15-06-029 (June 11, 2015), Decision Regarding the Costs of Compliance with Decision 14-01-034 and Adoption of Biomethane Promotion Policies and Program, as follows:
Except for a dairy cluster biomethane project, the total available incentive limitation for a project shall be increased from one million five hundred thousand dollars ($1,500,000) to three million dollars ($3,000,000).
For a dairy cluster biomethane project, the total available incentive limitation shall be raised to five million dollars ($5,000,000), which may be used for interconnection costs and costs incurred for gathering lines to help reduce emissions of short-lived climate pollutants pursuant to Section 39730 of the Health and Safety Code. For purposes of this subdivision, a dairy cluster biomethane project means a biomethane project of three or more dairies in close proximity to one another employing multiple facilities for the capture of biogas that is transported by multiple gathering lines to a centralized processing facility where the biogas is processed to meet the biomethane standards adopted by the commission pursuant to subdivisions (c) and (d), or updated pursuant to subdivision (e), of Section 25421 of the Health and Safety Code and injected into the pipeline of the gas corporation through a single interconnection.
This section shall remain in effect only until January 1, 2027, and as of that date is repealed, unless a later enacted statute, that is enacted before January 1, 2027, deletes or extends that date.
It is the policy of this state and the intent of the Legislature to encourage electrical generation from eligible renewable energy resources.
Paragraph (5) of subdivision (f) is appropriate because the program is a fixed-price feed-in tariff program with no pricing discretion.
This section does not authorize cost recovery by an entity other than an electrical corporation regulated by the commission, except for the procurement authorized in paragraph (5) of subdivision (f).
As used in this section, “electric generation facility” means an electric generation facility located within the service territory of an electrical corporation, and developed to sell electricity to, an electrical corporation or, for a bioenergy electric generation facility, to an electrical corporation or a community choice aggregator that provides electric service within the service territory of the electrical corporation that meets all of the following criteria:
Has an effective capacity of not more than three megawatts, with the exception of those facilities participating in a tariff made available pursuant to paragraph (2) of subdivision (f).
Is interconnected and operates in parallel with the electrical transmission and distribution grid.
Except as provided in subparagraph (B), is strategically located and interconnected to the electrical transmission and distribution grid in a manner that optimizes the deliverability of electricity generated at the facility to load centers.
For purposes of paragraph (2) of subdivision (f), is strategically located and interconnected to the electrical transmission and distribution grid in a manner that optimizes the deliverability of electricity generated at the facility to load centers or is interconnected to an existing transmission line.
Is an eligible renewable energy resource.
Every electrical corporation shall file with the commission a standard tariff for electricity purchased from an electric generation facility. The commission may modify or adjust the requirements of this section for any electrical corporation with less than 100,000 service connections, as individual circumstances merit.
The long-term market price of electricity for fixed price contracts, determined pursuant to an electrical corporation’s general procurement activities as authorized by the commission.
The long-term ownership, operating, and fixed-price fuel costs associated with fixed-price electricity from new generating facilities.
The value of different electricity products including baseload, peaking, and as-available electricity.
The commission may adjust the payment rate to reflect the value of every kilowatthour of electricity generated on a time-of-delivery basis.
An electrical corporation shall provide expedited interconnection procedures to an electric generation facility located on a distribution circuit that generates electricity at a time and in a manner so as to offset the peak demand on the distribution circuit, if the electrical corporation determines that the electric generation facility will not adversely affect the distribution grid. The commission shall consider and may establish a value for an electric generation facility located on a distribution circuit that generates electricity at a time and in a manner so as to offset the peak demand on the distribution circuit.
An electrical corporation shall make the tariff available to the owner or operator of an electric generation facility within the service territory of the electrical corporation, upon request, on a first-come-first-served basis, until the electrical corporation meets its proportionate share of a statewide cap of 750 megawatts cumulative rated generation capacity served under this section and Section 399.32. The proportionate share shall be calculated based on the ratio of the electrical corporation’s peak demand compared to the total statewide peak demand.
By June 1, 2013, the commission shall, in addition to the 750 megawatts identified in paragraph (1), direct the electrical corporations to collectively procure at least 250 megawatts of cumulative rated generating capacity from developers of bioenergy projects that commence operation on or after June 1, 2013. The commission shall, for each electrical corporation, allocate shares of the additional 250 megawatts based on the ratio of each electrical corporation’s peak demand compared to the total statewide peak demand. In implementing this paragraph, the commission shall do all of the following:
Allocate the 250 megawatts identified in this paragraph among the electrical corporations based on the following categories:
For biogas from wastewater treatment, municipal organic waste diversion, food processing, and codigestion, 110 megawatts.
For dairy and other agricultural bioenergy, 90 megawatts.
For bioenergy using byproducts of sustainable forest management, 50 megawatts. Allocations under this category shall be determined based on the proportion of bioenergy that sustainable forest management providers derive from sustainable forest management in fire threat treatment areas, as designated by the Department of Forestry and Fire Protection.
Direct the electrical corporations to develop standard contract terms and conditions that reflect the operational characteristics of the projects, and to provide a streamlined contracting process.
Coordinate, to the maximum extent feasible, any incentive or subsidy programs for bioenergy with the agencies listed in subparagraph (A) of paragraph (3) in order to provide maximum benefits to ratepayers and to ensure that incentives are used to reduce contract prices.
The commission shall encourage gas and electrical corporations to develop and offer programs and services to facilitate development of in-state biogas for a broad range of purposes.
Direct the electrical corporations to authorize a bioenergy electric generation facility with an effective capacity of up to five megawatts to participate in the tariff made available pursuant to this paragraph, if it meets the following conditions:
It delivers no more than three megawatts to the grid at any time.
It complies with the electrical corporation’s Electric Rule 21 tariff or other distribution access tariff.
Payment is made pursuant to paragraph (1) of subdivision (d) and no payment is made for any electricity delivered to the grid in excess of three megawatts at any time.
The commission, in consultation with the Energy Commission, the State Air Resources Board, the Department of Forestry and Fire Protection, the Department of Food and Agriculture, and the Department of Resources Recycling and Recovery, may review the allocations of the 250 additional megawatts identified in paragraph (2) to determine if those allocations are appropriate.
If the commission finds that the allocations of the 250 additional megawatts identified in paragraph (2) are not appropriate, the commission may reallocate the 250 megawatts among the categories established in subparagraph (A) of paragraph (2).
A project identified in clause (iii) of subparagraph (A) of paragraph (2) is eligible, in regards to interconnection, for the tariff established to implement paragraph (2) or to participate in any program or auction established to implement paragraph (2), if it meets at least one of the following requirements:
The project is already interconnected.
The project has been found to be eligible for interconnection pursuant to the fast track process under the relevant tariff.
A system impact study or other interconnection study has been completed for the project under the relevant tariff, and there was no determination in the study that, with the identified interconnection upgrades, if any, a condition specified in paragraph (2), (3), or (4) of subdivision (n) would exist. Such a project is not required to have a pending, active interconnection application to be eligible.
For a project meeting the eligibility requirements pursuant to clause (iii) of subparagraph (A) of this paragraph, both of the following apply:
The project is hereby deemed to be able to interconnect within the required time limits for the purpose of determining eligibility for the tariff.
The project shall submit a new application for interconnection within 30 days of execution of a standard contract pursuant to the tariff if it does not have a pending, active interconnection application or a completed interconnection. For those projects, the time to achieve commercial operation shall begin to run from the date when the new system impact study or other interconnection study is completed rather than from the date of execution of the standard contract.
A community choice aggregator may submit eligible bioenergy projects to the commission for cost recovery if open capacity exists within an allocation category described in subparagraph (A) of paragraph (2) and the community choice aggregator submits an eligible tariff to the commission consistent with both of the following:
The community choice aggregator files with the commission a standard tariff for electricity purchased from a bioenergy electric generation facility.
The tariff provides for payment for every kilowatthour of electricity purchased from a bioenergy electric generation facility for a period of 10, 15, or 20 years, as authorized by the commission. The payment shall be the market price determined by the commission pursuant to subclause (II) and shall include all current and anticipated environmental compliance costs, including, but not limited to, mitigation of emissions of greenhouse gases and air pollution offsets associated with the operation of new generating facilities in the local air pollution control or air quality management district where the bioenergy electric generation facility is located.
(II) The commission shall establish a methodology to determine the market price of electricity for terms corresponding to the length of contracts with a bioenergy electric generation facility, considering those matters described in paragraph (2) of subdivision (d).
Any capacity procured by the community choice aggregator from a bioenergy project that is approved by the commission pursuant to this paragraph shall reduce the procurement targets for that allocation category ordered by the commission for the electrical corporation whose service territory encompasses the community choice aggregator pursuant to paragraph (2), or as modified pursuant to paragraph (3).
Before acting pursuant to the authorization in subparagraph (A), a community choice aggregator shall develop standard contract terms and conditions that reflect the operational characteristics of the bioenergy electric generation facility and provide a streamlined contracting process. A community choice aggregator shall use the standard contract approved by the commission for use by the electrical corporation pursuant to subparagraph (B) of paragraph (2) to comply with this requirement, so long as all the terms and conditions of the contract are not modified by the community choice aggregator.
In implementing this paragraph, the commission shall do all of the following:
Coordinate, to the maximum extent feasible, any incentive or subsidy programs for bioenergy with the agencies listed in subparagraph (A) of paragraph (3) in order to provide maximum benefits to ratepayers and to ensure that incentives are used to reduce contract prices.
Direct a participating community choice aggregator to authorize a bioenergy electric generation facility with an effective capacity of up to five megawatts to participate in the tariff made available pursuant to this paragraph if it meets the following conditions:
The community choice aggregator may make the terms of the tariff available to owners and operators of a bioenergy electric generation facility in the form of a standard contract subject to commission approval. To comply with this requirement, the community choice aggregator may base its tariff on the electrical corporation’s approved tariff, so long as all the terms and conditions of the tariff are not modified by the community choice aggregator.
Every kilowatthour of electricity purchased from a bioenergy electric generation facility shall count toward meeting the community choice aggregator’s renewables portfolio standard annual procurement targets for purposes of paragraph (1) of subdivision (b) of Section 399.15.
The physical generating capacity of a bioenergy electric generation facility shall count toward the community choice aggregator’s resource adequacy requirement for purposes of Section 380.
In order to ensure the safety and reliability of bioenergy electric generation facilities, the owner of a bioenergy electric generation facility receiving a tariff pursuant to this paragraph shall provide an inspection and maintenance report to the community choice aggregator at least once every other year. The inspection and maintenance report shall be prepared at the owner’s or operator’s expense by a California-licensed contractor who is not the owner or operator of the bioenergy electric generation facility. A California-licensed electrician shall perform the inspection of the electrical portion of the generation facility.
The contract between the bioenergy electric generation facility receiving the tariff and the community choice aggregator shall contain provisions that ensure that construction of the bioenergy electric generating facility complies with all applicable state and local laws and building standards and utility interconnection requirements.
The commission may modify or adjust the requirements of this paragraph for any community choice aggregator with less than 100,000 customer accounts as individual circumstances merit.
The commission has ongoing review authority over any contracts of community choice aggregators submitted pursuant to this section consistent with its review of the contracts of electrical corporations entered into pursuant to this section.
For the purposes of this subdivision, “bioenergy” means biogas and biomass.
The electrical corporation may make the terms of the tariff available to owners and operators of an electric generation facility in the form of a standard contract subject to commission approval.
Every kilowatthour of electricity purchased from an electric generation facility shall count toward meeting the electrical corporation’s renewables portfolio standard annual procurement targets for purposes of paragraph (1) of subdivision (b) of Section 399.15.
The physical generating capacity of an electric generation facility shall count toward the electrical corporation’s resource adequacy requirement for purposes of Section 380.
The commission shall establish performance standards for any electric generation facility that has a capacity greater than one megawatt to ensure that those facilities are constructed, operated, and maintained to generate the expected annual net production of electricity and do not impact system reliability.
The commission may reduce the three megawatt capacity limitation of paragraph (1) of subdivision (b) if the commission finds that a reduced capacity limitation is necessary to maintain system reliability within the applicable electrical corporation’s service territory.
Any owner or operator of an electric generation facility that received ratepayer-funded incentives in accordance with Section 379.6 of this code, or with Section 25782 of the Public Resources Code, and participated in a net metering program pursuant to Sections 2827, 2827.9, and 2827.10 of this code before January 1, 2010, shall be eligible for a tariff or standard contract filed by an electrical corporation pursuant to this section.
In establishing the tariffs or standard contracts pursuant to this section, the commission shall consider ratepayer-funded incentive payments previously received by the generation facility pursuant to Section 379.6 of this code or Section 25782 of the Public Resources Code. The commission shall require reimbursement of any funds received from these incentive programs to an electric generation facility, in order for that facility to be eligible for a tariff or standard contract filed by an electrical corporation pursuant to this section, unless the commission determines ratepayers have received sufficient value from the incentives provided to the facility based on how long the project has been in operation and the amount of renewable electricity previously generated by the facility.
A customer that receives service under a tariff or contract approved by the commission pursuant to this section is not eligible to participate in any net metering program.
An owner or operator of an electric generation facility electing to receive service under a tariff or contract approved by the commission shall continue to receive service under the tariff or contract until either of the following occurs:
Within 10 days of receipt of a request for a tariff pursuant to this section from an owner or operator of an electric generation facility, the electrical corporation that receives the request shall post a copy of the request on its internet website. The information posted on the internet website shall include the name of the city in which the facility is located, but information that is proprietary and confidential, including, but not limited to, address information beyond the name of the city in which the facility is located, shall be redacted.
An electrical corporation may deny a tariff request pursuant to this section if the electrical corporation makes any of the following findings:
The electric generation facility does not meet the requirements of this section.
The transmission or distribution grid that would serve as the point of interconnection is inadequate.
The electric generation facility does not meet all applicable state and local laws and building standards and utility interconnection requirements.
The aggregate of all electric generating facilities on a distribution circuit would adversely impact utility operation and load restoration efforts of the distribution system.
Upon receiving a notice of denial from an electrical corporation, the owner or operator of the electric generation facility denied a tariff pursuant to this section shall have the right to appeal that decision to the commission.
In order to ensure the safety and reliability of electric generation facilities, the owner of an electric generation facility receiving a tariff pursuant to this section shall provide an inspection and maintenance report to the electrical corporation at least once every other year. The inspection and maintenance report shall be prepared at the owner’s or operator’s expense by a California-licensed contractor who is not the owner or operator of the electric generation facility. A California-licensed electrician shall perform the inspection of the electrical portion of the generation facility.
The contract between the electric generation facility receiving the tariff and the electrical corporation shall contain provisions that ensure that construction of the electric generating facility complies with all applicable state and local laws and building standards, and utility interconnection requirements.
All construction and installation of facilities of the electrical corporation, including at the point of the output meter or at the transmission or distribution grid, shall be performed only by that electrical corporation.
All interconnection facilities installed on the electrical corporation’s side of the transfer point for electricity between the electrical corporation and the electrical conductors of the electric generation facility shall be owned, operated, and maintained only by the electrical corporation. The ownership, installation, operation, reading, and testing of revenue metering equipment for electric generating facilities shall only be performed by the electrical corporation.
For purposes of this section, the following definitions apply:
“Bioenergy” has the same meaning as set forth in paragraph (6) of subdivision (f) of Section 399.20.
“Tier 1 high hazard zone” includes areas where wildlife and falling trees threaten electrical transmission and distribution lines, roads, and other evacuation corridors, critical community infrastructure, or other existing structures, as designated by the Department of Forestry and Fire Protection pursuant to the Proclamation of a State of Emergency on Tree Mortality declared by the Governor on October 30, 2015.
“Tier 2 high hazard zone” includes watersheds that have significant tree mortality combined with community and natural resource assets, as designated by the Department of Forestry and Fire Protection pursuant to the Proclamation of a State of Emergency on Tree Mortality declared by the Governor on October 30, 2015.
In addition to the requirements of subdivision (f) of Section 399.20, on or before July 1, 2025, electrical corporations shall collectively procure, through financial commitments of 5 to 15 years, inclusive, their proportionate share of 125 megawatts of cumulative rated generating capacity from existing bioenergy projects that commenced operations before June 1, 2013. At least 80 percent of the feedstock of an eligible facility, on an annual basis, shall be a byproduct of sustainable forestry management, which includes removal of dead and dying trees from Tier 1 and Tier 2 high hazard zones and is not that from lands that have been clear cut. At least 60 percent of this feedstock shall be from Tier 1 and Tier 2 high hazard zones.
Paragraph (1) does not apply to a utility subject to subdivision (g) if both of the following apply:
The utility, either directly or through a joint powers authority, entered into five-year financial commitments for its proportionate share of 125 megawatts of cumulative rated generating capacity from existing bioenergy projects pursuant to this section as it was enacted by Chapter 368 of the Statutes of 2016.
The utility’s financial commitments referenced in subparagraph (A) include either: (i) a contract with a facility operator that was, on June 1, 2022, in a bankruptcy or other insolvency proceeding; or (ii) a contract for a project that does not deliver energy to the utility.
For the purpose of contracts entered into pursuant to subdivision (b), commission Resolution E-4770 (March 17, 2016), and commission Resolution E-4805 (October 13, 2016), Tier 1 and Tier 2 high hazard zone fuel or feedstock shall also include biomass fuels removed from fuel reduction operations exempt from timber harvesting plan requirements pursuant to subdivisions (a), (f), (j), and (k) of Section 4584 of the Public Resources Code, as those subdivisions read on January 1, 2024.
The commission shall require an electrical corporation that has entered into a contract pursuant to subdivision (b), commission Resolution E-4770 (March 17, 2016), or commission Resolution E-4805 (October 13, 2016) to allow fuel or feedstock reporting requirements to be based on a monthly or annual basis, and a bioenergy facility providing generation pursuant to that contract shall have the right to opt out of the mandated fuel or feedstock usage levels in any particular month upon providing written notice to the electrical corporation in the month of operation. For months in which a bioenergy facility opts out of the mandated fuel or feedstock usage levels or misses the mandated fuel or feedstock targets, that facility shall be paid the alternate price adopted by the commission in commission Resolution E-4770 for all megawatthours generated during that month. Contracts shall continue in force through the end of the contracted term without creating an event of default for missing mandated fuel or feedstock usage levels and without giving rise to a termination right in favor of the electrical corporation.
For each electrical corporation, the commission shall allocate its proportionate share of the 125 megawatts based on the ratio of the electrical corporation’s peak demand to the total statewide peak demand.
Procurement by an electrical corporation of generation capacity pursuant to a contract under the commission’s Resolution E-4770 (March 17, 2016) that is in excess of the requirement of that electrical corporation under that resolution shall count towards meeting the electrical corporation’s proportionate share allocated pursuant to paragraph (1).
The commission may direct each electrical corporation to develop standard contract terms and conditions that reflect the operational characteristics of the bioenergy projects and to provide a streamlined contracting process or may require the electrical corporations to use the mechanism established pursuant to the commission’s Resolution E-4770 (March 17, 2016) to meet the requirements of subdivision (e). The procurement pursuant to the developed standard contract shall occur on an expedited basis due to the Proclamation of a State of Emergency on Tree Mortality declared by the Governor on October 30, 2015.
A local publicly owned electric utility serving more than 100,000 customers shall procure its proportionate share, based on the ratio of the utility’s peak demand to the total statewide peak demand, of 125 megawatts of cumulative rated capacity from existing bioenergy projects described in subdivision (b) subject to terms of at least five years.
The commission shall ensure that the costs of any contract procured by an electrical corporation to satisfy the requirements of this section are recoverable from all customers on a nonbypassable basis.
The Procurement Review Group within the commission shall advise the commission on the cost of the generation procured pursuant to this section and its impact on ratepayers.
For purposes of this section, any incremental procurement of electricity products from bioenergy resources by a new contract or contract extension of five years or longer in duration shall be from a resource that meets emission limits equivalent to, or more stringent than, the applicable best available retrofit control technology, as determined by the local air pollution control district or air quality management district. The determination shall be made before the start of the operating period under the new contract or contract extension.
Notwithstanding paragraph (1) of subdivision (b) and paragraph (2) of subdivision (j) of Section 399.20, a conduit hydroelectric facility with an effective capacity of up to four megawatts that otherwise meets the requirements of Section 399.20 shall be eligible for the standard contract or tariff established pursuant to subdivision (c) of Section 399.20 if the electric generation facility meets all the following additional requirements:
It was operational as of January 1, 1990.
It delivers no more than three megawatts to the grid at any time.
It complies with the electrical corporation’s Electric Rule 21 tariff or other distribution access tariff.
A facility meeting the requirements of subdivision (a) shall receive payment pursuant to paragraph (1) of subdivision (d) of Section 399.20, provided that no payment shall be made for any electricity delivered to the grid in excess of three megawatts at any time.
The commission, by rule, shall authorize the use of renewable energy credits to satisfy the renewables portfolio standard procurement requirements established pursuant to this article, subject to the following conditions:
The commission and the Energy Commission shall ensure that the tracking system established pursuant to subdivision (c) of Section 399.25, is operational, is capable of independently verifying that electricity earning the credit is generated by an eligible renewable energy resource, and can ensure that renewable energy credits shall not be double counted by any seller of electricity within the service territory of the WECC.
Each renewable energy credit shall be counted only once for compliance with the renewables portfolio standard of this state or any other state, or for verifying retail product claims in this state or any other state.
All revenues received by an electrical corporation for the sale of a renewable energy credit shall be credited to the benefit of ratepayers.
Renewable energy credits shall not be created for electricity generated pursuant to any electricity purchase contract with a retail seller or a local publicly owned electric utility executed before January 1, 2005, unless the contract contains explicit terms and conditions specifying the ownership or disposition of those credits. Procurement under those contracts shall be tracked through the accounting system described in subdivision (b) of Section 399.25 and included in the quantity of eligible renewable energy resources of the purchasing retail seller pursuant to Section 399.15.
Renewable energy credits shall not be created for electricity generated under any electricity purchase contract executed after January 1, 2005, pursuant to the federal Public Utility Regulatory Policies Act of 1978 (16 U.S.C. Sec. 2601 et seq.). Procurement under the electricity purchase contracts shall be tracked through the accounting system implemented by the Energy Commission pursuant to subdivision (b) of Section 399.25 and count toward the renewables portfolio standard procurement requirements of the purchasing retail seller.
Nothing in the amendments to this article made by the Clean Energy and Pollution Reduction Act of 2015 (Senate Bill 350 of the 2015–16 Regular Session) is intended to change commission Decision 11-12-052 regarding the classification of renewable energy credits from generation on the customer side of the meter.
A renewable energy credit shall not be eligible for compliance with a renewables portfolio standard procurement requirement unless it is retired in the tracking system established pursuant to subdivision (c) of Section 399.25 by the retail seller or local publicly owned electric utility within 36 months from the initial date of generation of the associated electricity.
The commission shall allow an electrical corporation to recover the reasonable costs of purchasing, selling, and administering renewable energy credit contracts in rates.
For purposes of this section, “state agency” means any state agency, board, department, or commission, including the entities specified in subdivision (a) of Section 15814.12 of the Government Code.
A state agency generating electricity from an electric generation facility, as defined in Section 387.6 or 399.20, that operates under a tariff adopted pursuant to either of those sections, and that is owned by, operated by, or on property under the control of, the state agency shall take the total annual amount of kilowatthours exported to the grid into consideration when determining whether the state agency has achieved the policy goals and objectives established by law for the state agency.
To meet the energy and transportation needs of the state, the commission shall adopt policies and programs that promote the in-state production and distribution of biomethane. The policies and programs shall facilitate the development of a variety of sources of in-state biomethane.
For the purposes of this section, “biomethane” means biogas that meets the standards adopted pursuant to subdivisions (c) and (d) of Section 25421 of the Health and Safety Code for injection into a common carrier pipeline.
The Energy Commission shall do all of the following:
Certify eligible renewable energy resources that it determines meet the criteria described in subdivision (e) of Section 399.12.
Design and implement an accounting system to verify compliance with the renewables portfolio standard by retail sellers and local publicly owned electric utilities, to ensure that electricity generated by an eligible renewable energy resource is counted only once for the purpose of meeting the renewables portfolio standard of this state or any other state, to certify renewable energy credits produced by eligible renewable energy resources, and to verify retail product claims in this state or any other state. In establishing the guidelines governing this accounting system, the Energy Commission shall collect data from electricity market participants that it deems necessary to verify compliance of retail sellers and local publicly owned electric utilities, in accordance with the requirements of this article and the California Public Records Act (Division 10 (commencing with Section 7920.000) of Title 1 of the Government Code). In seeking data from electrical corporations, the Energy Commission shall request data from the commission. The commission shall collect data from electrical corporations and remit the data to the Energy Commission within 90 days of the request.
Establish a system for tracking and verifying renewable energy credits that, through the use of independently audited data, verifies the generation of electricity associated with each renewable energy credit and protects against multiple counting of the same renewable energy credit. The Energy Commission shall consult with other western states and with the WECC in the development of this system.
Certify, for purposes of compliance with the renewables portfolio standard requirements by a retail seller, the eligibility of renewable energy credits associated with eligible renewable energy resources procured by a local publicly owned electric utility, if the Energy Commission determines that all of the conditions of Section 399.31 have been met.
In order for the state to meet the requirements of the California Renewables Portfolio Standard Program, substantially increased amounts of electricity generated by eligible renewable energy resources must be integrated with, and interconnected to, the transmission grid that is either owned by, or under the operational control of, the local publicly owned electric utilities and the transmission grid that is under the operational control of the Independent System Operator.
The Independent System Operator and the balancing authority of each area in California shall do both of the following:
Work cooperatively to integrate and interconnect eligible renewable energy resources to the transmission grid by the most efficient means possible with the goal of minimizing the impact and cost of new transmission needed to meet both reliability needs and the renewables portfolio standard procurement requirements.
Accomplish the requirements of paragraph (1) in a manner that respects the ownership, business, and dispatch models for transmission facilities owned by electrical corporations, local publicly owned electric utilities, joint powers agencies, and independent transmission companies.
The Independent System Operator shall seek any approvals from the Federal Energy Regulatory Commission that are necessary to accomplish the goals and requirements of this article.
In order to maintain electric service reliability and to minimize the construction of fossil fuel electrical generation capacity to support the integration of intermittent renewable electrical generation into the electrical grid, by July 1, 2011, the commission shall determine the effective load carrying capacity of wind and solar energy resources on the California electrical grid. The commission shall use those effective load carrying capacity values in establishing the contribution of wind and solar energy resources toward meeting the resource adequacy requirements established pursuant to Section 380.
To fulfill unmet long-term generation resource needs, each local publicly owned electric utility shall adopt and implement a renewable energy resources procurement plan that requires the utility to procure a minimum quantity of electricity products from eligible renewable energy resources, including renewable energy credits, as a specified percentage of total kilowatthours sold to the utility’s retail end-use customers, each compliance period, to achieve the targets of subdivision (c).
Beginning January 1, 2019, a local publicly owned electric utility subject to Section 9621 shall incorporate the renewable energy resources procurement plan required by this section as part of a broader integrated resource plan developed and adopted pursuant to Section 9621.
The governing board shall implement procurement targets for a local publicly owned electric utility that require the utility to procure a minimum quantity of eligible renewable energy resources for each of the following compliance periods:
January 1, 2011, to December 31, 2013, inclusive.
January 1, 2014, to December 31, 2016, inclusive.
January 1, 2017, to December 31, 2020, inclusive.
January 1, 2021, to December 31, 2024, inclusive.
January 1, 2025, to December 31, 2027, inclusive.
January 1, 2028, to December 31, 2030, inclusive.
The governing board of a local publicly owned electric utility shall ensure all of the following:
Conditions that allow for delaying timely compliance consistent with subdivision (b) of Section 399.15.
Cost limitations for procurement expenditures consistent with subdivision (c) of Section 399.15.
The governing board of the local publicly owned electric utility shall adopt a program for the enforcement of this article. The program shall be adopted at a publicly noticed meeting offering all interested parties an opportunity to comment. Not less than 30 days’ notice shall be given to the public of any meeting held for purposes of adopting the program. Not less than 10 days’ notice shall be given to the public before any meeting is held to make a substantive change to the program.
Each local publicly owned electric utility shall annually post notice, in accordance with the Ralph M. Brown Act (Chapter 9 (commencing with Section 54950) of Part 1 of Division 2 of Title 5 of the Government Code), whenever its governing body will deliberate in public on its renewable energy resources procurement plan.
A public utility district that receives all of its electricity pursuant to a preference right adopted and authorized by the United States Congress pursuant to Section 4 of the Trinity River Division Act of August 12, 1955 (Public Law 84-386), shall be in compliance with the renewable energy procurement requirements of this article.
For a local publicly owned electric utility that was in existence on or before January 1, 2009, that provides retail electric service to 15,000 or fewer customer accounts in California, and is interconnected to a balancing authority located outside this state but within the WECC, an eligible renewable energy resource includes a facility that is located outside California that is connected to the WECC transmission system, if all of the following conditions are met:
The electricity generated by the facility is procured by the local publicly owned electric utility, is delivered to the balancing authority area in which the local publicly owned electric utility is located, and is not used to fulfill renewable energy procurement requirements of other states.
The local publicly owned electric utility participates in, and complies with, the accounting system administered by the Energy Commission pursuant to this article.
The Energy Commission verifies that the electricity generated by the facility is eligible to meet the renewables portfolio standard procurement requirements.
Notwithstanding subdivision (a), for a local publicly owned electric utility that is a joint powers authority of districts established pursuant to state law on or before January 1, 2005, that furnishes electric services other than to residential customers, and is formed pursuant to the Irrigation District Law (Division 11 (commencing with Section 20500) of the Water Code), the percentage of total kilowatthours sold to the district’s retail end-use customers, upon which the renewables portfolio standard procurement requirements in subdivision (b) are calculated, shall be based on the authority’s average retail sales over the previous seven years. If the authority has not furnished electric service for seven years, then the calculation shall be based on average retail sales over the number of completed years during which the authority has provided electric service.
A local publicly owned electric utility in a city and county that only receives greater than 67 percent of its electricity sources from hydroelectric generation located within the state that it owns and operates, and that does not meet the definition of a “renewable electrical generation facility” pursuant to Section 25741 of the Public Resources Code, shall be required to procure eligible renewable energy resources, including renewable energy credits, to meet only the electricity demands unsatisfied by its hydroelectric generation in any given year, in order to satisfy its renewable energy procurement requirements.
For purposes of this subdivision, “large hydroelectric generation” means electricity generated from an existing hydroelectric facility located within the state that does not qualify as an eligible renewable energy resource and, as of January 1, 2018, was owned by a local publicly owned electric utility, the federal government as a part of the federal Central Valley Project, or a joint powers agency formed and created pursuant to the Joint Exercise of Powers Act (Chapter 5 (commencing with Section 6500) of Division 7 of Title 1 of the Government Code).
If, during a year within a compliance period set forth in subdivision (b), a local publicly owned electric utility receives more than 40 percent of its retail sales from large hydroelectric generation under an ownership agreement or contract in effect as of January 1, 2018, it is not required to procure eligible renewable energy resources that exceed the lesser of the following for that year:
The portion of the local publicly owned electric utility’s retail sales unsatisfied by the local publicly owned electric utility’s large hydroelectric generation.
The soft target adopted by the Energy Commission for the intervening years of the relevant compliance period.
An extension or renewal of a procurement agreement shall not be eligible to count towards the determination that the local publicly owned electric utility receives more than 40 percent of its retail sales from large hydroelectric generation in any year. This paragraph shall not apply to any agreement in effect on January 1, 2015, between a local publicly owned electric utility and the Western Area Power Administration or federal government as part of the federal Central Valley Project.
The Energy Commission shall adjust the total quantities of eligible renewable energy resources to be procured by a local publicly owned electric utility for a compliance period to reflect any reductions required pursuant to paragraph (2).
This subdivision does not modify the compliance obligation of a local publicly owned electric utility to satisfy the requirements of subdivision (c) of Section 399.16.
For purposes of this subdivision, “unavoidable long-term contracts and ownership agreements” means commitments for electricity from a coal-fired powerplant, located outside the state, originally entered into by a local publicly owned electric utility before June 1, 2010, that is not subsequently modified to result in an extension of the duration of the agreement or result in an increase in total quantities of energy delivered during any compliance period set forth in subdivision (b).
The governing board of a local publicly owned electric utility shall demonstrate in its renewable energy resources procurement plan required pursuant to subdivision (a) that any cancellation or divestment of the commitment would result in significant economic harm to its retail customers that cannot be substantially mitigated through resale, transfer to another entity, early closure of the facility, or other feasible measures.
A local publicly owned electric utility shall retain discretion over both of the following:
The Energy Commission shall adopt regulations specifying procedures for enforcement of this article. The regulations shall include a public process under which the Energy Commission may issue a notice of violation and correction against a local publicly owned electric utility for failure to comply with this article, and for referral of violations to the State Air Resources Board for penalties pursuant to subdivision (o).
Upon a determination by the Energy Commission that a local publicly owned electric utility has failed to comply with this article, the Energy Commission shall refer the failure to comply with this article to the State Air Resources Board, which may impose penalties to enforce this article consistent with Part 6 (commencing with Section 38580) of Division 25.5 of the Health and Safety Code. Any penalties imposed shall be comparable to those adopted by the commission for noncompliance by retail sellers.
Any penalties collected by the State Air Resources Board pursuant to this article shall be deposited in the Air Pollution Control Fund and, upon appropriation by the Legislature, shall be expended for reducing emissions of air pollution or greenhouse gases within the same geographic area as the local publicly owned electric utility.
A retail seller may procure renewable energy credits associated with deliveries of electricity by an eligible renewable energy resource to a local publicly owned electric utility, for purposes of compliance with the renewables portfolio standard requirements, if both of the following conditions are met:
The local publicly owned electric utility has adopted and implemented a renewable energy resources procurement plan that complies with the renewables portfolio standard adopted pursuant to Section 399.30.
The local publicly owned electric utility is procuring sufficient eligible renewable energy resources to satisfy the target standard, and will not fail to satisfy the target standard in the event that the renewable energy credit is sold to the retail seller.
It is the policy of the state and the intent of the Legislature to encourage electrical generation from eligible renewable energy resources.
As used in this section, “electric generation facility” means an electric generation facility located within the service territory of, and developed to sell electricity to, a local publicly owned electric utility, and that meets all of the following criteria:
Has an effective capacity of not more than three megawatts.
Is interconnected and operates in parallel with the electrical transmission and distribution grid.
Is strategically located and interconnected to the electrical transmission and distribution grid in a manner that optimizes the deliverability of electricity generated at the facility to load centers.
Is an eligible renewable energy resource pursuant to this article.
A local publicly owned electric utility that sells electricity at retail to 75,000 or more customers shall adopt a standard tariff for electricity purchased from an electric generation facility by July 1, 2013.
The governing board of the local publicly owned electric utility shall ensure that the tariff adopted pursuant to subdivision (c) reflects the value of every kilowatthour of electricity generated on a time-of-delivery basis, and shall consider avoided costs for distribution and transmission system upgrades, whether the facility generates electricity in a manner that offsets peak demand on the distribution circuit, and all current and anticipated environmental and greenhouse gases reduction compliance costs. The governing board may adjust this value based on the other attributes of renewable generation. The governing board shall ensure, with respect to rates and charges, that ratepayers that do not receive service pursuant to the tariff are indifferent to whether a ratepayer with an electric generation facility receives service pursuant to the tariff.
A local publicly owned electric utility that sells electricity at retail to 75,000 or more customers shall make the tariff available to the owner or operator of an electric generation facility within the service territory of the utility, upon request, on a first-come-first-served basis, until the utility meets its proportionate share of a statewide cap of 750 megawatts cumulative rated generation capacity served under this section and Section 399.20. The proportionate share shall be calculated based on the ratio of the utility’s peak demand compared to the total statewide peak demand.
The local publicly owned electric utility may make the terms of the tariff available to owners and operators of an electric generation facility in the form of a standard contract.
Every kilowatthour of electricity purchased from an electric generation facility shall count toward meeting the local publicly owned electric utility’s renewables portfolio standard annual procurement targets for purposes of Section 399.30.
A local publicly owned electric utility may establish performance standards for any electric generation facility that has a capacity greater than one megawatt to ensure that those facilities are constructed, operated, and maintained to generate the expected annual net production of electricity and do not impact system reliability.
A local publicly owned electric utility may reduce the three megawatt capacity limitation of paragraph (1) of subdivision (b) if the utility finds that a reduced capacity limitation is necessary.
Within 10 days of receipt of a request for a tariff pursuant to this section from an owner or operator of an electric generation facility, the local publicly owned electric utility that receives the request shall post a copy of the request on its Internet Web site. The information posted on the Internet Web site shall include the name of the city in which the facility is located, but information that is proprietary and confidential, including, but not limited to, address information beyond the name of the city in which the facility is located, shall be redacted.
A local publicly owned electric utility may deny a tariff request pursuant to this section if the local publicly owned electric utility makes any of the following findings:
The electric generation facility does not meet the requirements of this section.
The transmission or distribution grid that would serve as the point of interconnection is inadequate.
The electric generation facility does not meet all applicable state and local laws and building standards, and utility interconnection requirements.
The aggregate of all electric generating facilities on a distribution circuit would adversely impact utility operation and load restoration efforts of the distribution system.
Upon receiving a notice of denial from a local publicly owned electric utility, the owner or operator of the electric generation facility denied a tariff pursuant to this section shall have the right to appeal that decision to the governing board of the local publicly owned electric utility.
In order to ensure the safety and reliability of electric generation facilities, the owner of an electric generation facility receiving a tariff pursuant to this section shall provide an inspection and maintenance report to the local publicly owned electric utility at least once every other year. The inspection and maintenance report shall be prepared at the owner’s or operator’s expense by a California-licensed contractor who is not the owner or operator of the electric generation facility. A California-licensed electrician shall perform the inspection of the electrical portion of the generation facility.
The contract between the electric generation facility receiving the tariff and the local publicly owned electric utility shall contain provisions that ensure that construction of the electric generating facility complies with all applicable state and local laws and building standards, and utility interconnection requirements.
All construction and installation of facilities of the local publicly owned electric utility, including at the point of the output meter or at the transmission or distribution grid, shall only be performed by that local publicly owned electric utility.
All interconnection facilities installed on the local publicly owned electric utility’s side of the transfer point for electricity between the local publicly owned electric utility and the electrical conductors of the electric generation facility shall be owned, operated, and maintained only by the local publicly owned electric utility. The ownership, installation, operation, reading, and testing of revenue metering equipment for electric generating facilities shall be performed only by the local publicly owned electric utility.
This section shall only apply to a gas-fired powerplant that is located inside the state, is owned by and serves the electrical demands of a single local publicly owned electric utility, and meets all of the following conditions:
The local publicly owned electric utility has outstanding public indebtedness associated with the powerplant, the powerplant was planned and built after January 1, 2000, and the debt was secured before January 1, 2017.
Operating the powerplant below a 20-percent capacity factor on an annual average on a yearly basis may result in the loss of employment of a powerplant employee who receives a prevailing wage.
The powerplant is subject to and meets the state’s greenhouse gases emission performance standard established by the Energy Commission pursuant to Section 8341.
The powerplant is not located in a disadvantaged community. For purposes of this paragraph, “disadvantaged community” means a census tract that, pursuant to Section 39711 of the Health and Safety Code, has received a score on the California Communities Environmental Health Screening 3.0, also known as CalEnviroScreen 3.0, in the 81st to 100th percentile, inclusive.
The local publicly owned electric utility can demonstrate with official documentation, such as an adopted city council resolution, to the satisfaction of the Energy Commission, that the powerplant was built in response to the energy crisis of 2000–01.
The powerplant has not undergone repowering and is not serving as a peaker powerplant.
If the procurement requirements of this article require more than 50 percent of retail sales of electricity to come from eligible renewable energy resources, then a local publicly owned electric utility that is the sole owner of a powerplant that both meets the requirements of subdivision (a) and is operating below 20 percent of its total capacity on an average annual basis during a given compliance period may, based on the utility’s operations, adjust its renewable energy procurement targets by an amount equal to the difference between the actual generation from the powerplant and the amount of generation that the powerplant would have produced if it had operated at 20 percent of its total capacity, if all of the following conditions are met:
The local publicly owned electric utility has procured eligible renewable energy resources as required by Section 399.30, as it existed on January 1, 2018.
Additional procurement of eligible renewable energy resources or zero-carbon generational resources resulted in the powerplant operating at, or below, a 20-percent capacity factor on an annual average during a compliance period.
The local publicly owned electric utility has attempted to mitigate against the reduction of generation to below 20 percent of the powerplant’s total capacity by attempting to sell the powerplant or attempting to sell the generation from the powerplant to the extent it is practicable and does not result in resource shuffling.
A local publicly owned electric utility shall notify the Energy Commission by April 1, 2019, of its intent to act pursuant to the authorization granted by this section.
The Energy Commission shall review, and either approve or reject, a publicly owned electric utility’s adjustment of its procurement targets pursuant to this section.
The Energy Commission may request relevant supporting documentation from a local publicly owned electric utility acting pursuant to this section.
This section shall apply only until the end of the calendar year during which the powerplant’s original term of bonded indebtedness expires.
ARTICLE 17. Clean Energy and Pollution Reduction [400. - 400.3.]
The commission and the Energy Commission shall do all of the following in furtherance of meeting the state’s clean energy and pollution reduction objectives:
Take into account the use of distributed generation to the extent that it provides economic and environmental benefits in disadvantaged communities identified pursuant to Section 39711 of the Health and Safety Code.
Take into account the opportunities to decrease costs and increase benefits, including pollution reduction and grid integration, using renewable and nonrenewable technologies with zero or lowest feasible emissions of greenhouse gases, criteria pollutants, and toxic air contaminants onsite in proceedings associated with meeting the objectives.
Where feasible, authorize procurement of resources to provide grid reliability services that minimize reliance on system power and fossil fuel resources and, where feasible, cost effective, and consistent with other state policy objectives, increase the use of large- and small-scale energy storage with a variety of technologies, including green electrolytic hydrogen, targeted energy efficiency, demand response, including, but not limited to, automated demand response, eligible renewable energy resources, or other renewable and nonrenewable technologies with zero or lowest feasible emissions of greenhouse gases, criteria pollutants, and toxic air contaminants onsite to protect system reliability.
Review technology incentive, research, development, deployment, and market facilitation programs overseen by the commission and the Energy Commission and make recommendations to advance state clean energy and pollution reduction objectives and provide benefits to disadvantaged communities identified pursuant to Section 39711 of the Health and Safety Code.
The Energy Commission shall review technology incentive, research, development, deployment, and market facilitation programs operating in California and overseen by academia and the private and nonprofit sectors, and make recommendations to advance state clean energy and pollution reduction objectives and provide benefits to disadvantaged communities identified pursuant to Section 39711 of the Health and Safety Code.
To the extent feasible and consistent with the state and federal constitutions, give first priority to the manufacture and deployment of clean energy and pollution reduction technologies that create employment opportunities in California, including high wage, highly skilled employment opportunities, and increased investment in the state.
Establish a publicly available tracking system to provide up-to-date information at least once annually on progress toward meeting the clean energy and pollution reduction goals of the Clean Energy and Pollution Reduction Act of 2015.
Establish a disadvantaged community advisory group consisting of representatives from disadvantaged communities identified pursuant to Section 39711 of the Health and Safety Code. The disadvantaged community advisory group shall review and provide advice on programs proposed to achieve clean energy and pollution reduction and determine whether those proposed programs will be effective and useful in disadvantaged communities.
Each member of the disadvantaged community advisory group shall receive per diem and shall be reimbursed for travel and other necessary expenses incurred in the performance of his or her duties under this section. The total amount of money expended for panel expenses pursuant to this paragraph shall not exceed one hundred thousand dollars ($100,000) per year.
For the purposes of paragraph (2), per diem, travel and other necessary expenses shall be funded equally by the commission and the Energy Commission.
For the purposes of this article, “green electrolytic hydrogen” means hydrogen gas produced through electrolysis and does not include hydrogen gas manufactured using steam reforming or any other conversion technology that produces hydrogen from a fossil fuel feedstock.
The commission, State Air Resources Board, and Energy Commission shall consider green electrolytic hydrogen an eligible form of energy storage and shall consider other potential uses of green electrolytic hydrogen in their decarbonization strategies. For purposes of this section, “decarbonization strategies” means actions undertaken to reduce or eliminate emissions of greenhouse gases.
CHAPTER 2.5. Public Utilities Commission Reimbursement Fees [401. - 444.]
ARTICLE 1. Collection and Disposition of Fees [401. - 410.]
The Legislature finds and declares that the public interest is best served by a commission that is appropriately funded and staffed, that can thoroughly examine the issues before it, and that can take timely and well-considered action on matters before it. The Legislature further finds and declares that funding the commission by means of a reasonable fee imposed upon each common carrier and business related thereto, each public utility that the commission regulates, and each applicant for, or holder of, a state franchise pursuant to Division 2.5 (commencing with Section 5800), helps to achieve those goals and is, therefore, in the public interest.
The Legislature intends, in enacting this chapter, that the fees levied and collected pursuant thereto produce enough, and only enough, revenues to fund the commission with (1) its authorized expenditures for each fiscal year to regulate common carriers and businesses related thereto, public utilities, and applicants and holders of a state franchise to be a video service provider, less the amount to be paid from special accounts except those established by this article, reimbursements, federal funds, and the unencumbered balance from the preceding year; (2) an appropriate reserve; and (3) any adjustment appropriated by the Legislature.
For purposes of this chapter, an “appropriate reserve” means a reserve in addition to the commission’s total authorized annual budget to regulate common carriers and related businesses, public utilities, and applicants and holders of a state franchise to be a video service provider, to be determined by the commission based on its past and projected operating experience.
The Public Utilities Commission Utilities Reimbursement Account is hereby continued in existence. All fees collected by the commission pursuant to Section 431 shall be transmitted to the Treasurer at least quarterly for deposit in the account.
There is hereby created the Public Utilities Commission Transportation Reimbursement Account in the General Fund. All fees collected by the commission pursuant to Section 421 shall be transmitted to the Treasurer at least quarterly for deposit in the account.
All fees paid pursuant to this chapter, exclusive of any penalties for delinquency, shall be allowed by the commission in a separate order as an ordinary operating expense for purposes of establishing rates or charges. The commission shall authorize each person or corporation subject to Section 421 or 431 to annually adjust its rates or charges for intrastate services so as to collect from its customers and subscribers an amount sufficient to pay the amount of the fee required by Section 421 or 431 together with the costs of collecting the fee from each customer or subscriber.
The commission shall adopt rules to determine the appropriate level of fees for carriers that provide transportation services incidental to commercial balloon operations, commercial river rafting, or skiing.
If any person or corporation subject to this chapter is in default of the preparation and submission of any report or the payment of any fee required by this chapter for a period of 30 days or more, the commission may suspend or revoke the certificate of public convenience and necessity, permit, or other operating authority of the person or corporation or order the person or corporation to cease and desist from conducting all operations subject to the jurisdiction of the commission, and the commission may estimate from all available information the appropriate fee and may add to the amount of that estimated fee a penalty not to exceed 25 percent of the amount on account of the failure, refusal, or neglect to prepare and submit the report or to pay the fee, and the person or corporation shall be estopped to complain of the amount of the commission’s estimate.
Upon payment of the fee so estimated and penalty, if applicable, the certificate, permit, or other operating authority of the person or corporation suspended in accordance with this section shall be reinstated or the order to cease and desist revoked. The commission may grant a reasonable extension of the 30-day period to any person or corporation upon written application and a showing of the necessity of the extension.
Upon revocation of any certificate, permit, or other operating authority or issuance of an order to cease and desist pursuant to this section, all fees in default shall become due and payable immediately.
The commission may bring an action, in its own name or in the name of the people of the state, in any court of competent jurisdiction, for the collection of delinquent fees estimated under Section 405, or for an amount due, owing, and unpaid to it, as shown by report filed by the commission, together with a penalty of 25 percent for the delinquency.
The commission shall authorize refunds of the fees provided for in this chapter when the fees were collected in error.
Notwithstanding any other provision of law, all fees and charges collected by the commission pursuant to this code from each common carrier and related business subject to Section 421 and from interstate or foreign highway carriers registered pursuant to the Interstate and Foreign Highway Carriers’ Registration Act (Chapter 2 (commencing with Section 3901) of Division 2), shall be deposited in the Public Utilities Commission Transportation Reimbursement Account, in addition to the fee authorized by Section 421.
Notwithstanding any other provision of law, all fees and charges collected pursuant to this code by the commission from each public utility subject to Section 431, with the exception of any penalty collected pursuant to Section 405 or 406, shall be deposited in the Public Utilities Commission Utilities Reimbursement Account, in addition to the fee authorized by Section 431.
The commission may establish rules and regulations that it deems necessary to carry out the provisions of this chapter.
ARTICLE 2. Common Carriers and Related Businesses [421. - 426.]
The commission shall annually determine a fee to be paid by every passenger stage corporation, charter-party carrier of passengers, pipeline corporation, for-hire vessel operator, common carrier vessel operator, railroad corporation, and commercial air operator, and every other common carrier and related business subject to the jurisdiction of the commission, except as otherwise provided in Article 3 (commencing with Section 431) of this chapter and Chapter 6 (commencing with Section 5001) of Division 2.
The annual fee shall be established to produce a total amount equal to the amount established in the authorized commission budget for the same year, including adjustments appropriated by the Legislature and an appropriate reserve, to regulate common carriers and related businesses, less the amount to be paid from special accounts or funds pursuant to Section 403, reimbursements, federal funds, other revenues, and unencumbered funds from the preceding year.
Notwithstanding any other provision of law, the fees paid by railroad corporations shall be used for state-funded railroad investigation and enforcement activities of the commission, other than the rail safety activities funded by the Transportation Planning and Development Account pursuant to Section 99315. The railroad fees shall be set annually at a level that generates not less than the amount sufficient to fund activities pursuant to Sections 765.5, 916.2, and 7712.
Expenditures of the detailed budget for the expenditure of railroad corporation fees submitted to the Legislature pursuant to Section 916.5 shall be limited to the following items:
Expenditures for employees occupying, and actually performing service in, railroad-safety personnel positions that are directly involved in inspecting railroads and enforcing rail safety regulations. The commission shall expend the funds budgeted pursuant to this subdivision for the salaries, per diem, and travel expenses of employees specified in this paragraph, unless, by statute, the commission is specifically prohibited from expending all or part of those funds.
Expenditures for employees occupying, and actually performing service in, clerical and support staff positions that are directly associated with railroad-safety inspections.
Expenditures for legal personnel who actually pursue violations of rail safety regulations beyond the informal complaint level.
Expenditures for the pro rata share of the commission’s overhead costs while state personnel are actually occupying the positions and are performing the duties specified in paragraphs (1) to (3), inclusive.
The Department of Finance shall notify the Joint Legislative Budget Committee, pursuant to Section 28.00 of the annual Budget Act, prior to authorizing any change in the Budget Act appropriation for railroad corporation fees that is larger than one hundred thousand dollars ($100,000), or 10 percent of the amount budgeted, whichever is less.
On or before January 1, 1994, the commission shall hire a minimum of four additional operating practices inspectors, exclusive of supervisory personnel, who are, or shall become by July 1, 1994, federally certified, for the purpose of enforcing compliance by railroads operating in this state with state and federal safety regulations.
The commission, in performing its duties, shall limit the expenditure of funds for rail safety purposes to those railroad corporation fees collected pursuant to subdivision (d). In no event shall the commission fund railroad safety activities utilizing funds from other commission accounts unrelated to railroad safety.
The commission shall establish the fee pursuant to Section 421 with the approval of the Department of Finance and in accordance with all of the following:
In its annual budget request, the commission shall specify, at a minimum, both of the following:
The amount of its budget to be financed by the fee.
The dollar allocation of the amount of its budget to be financed by the fee by each class of carrier and related business subject to the fee. Each class of carrier and related business subject to this article shall pay fees sufficient to support the commission’s regulatory activities for the class from which the fee is collected and to establish an appropriate reserve.
The commission may establish different and distinct methods of assessing fees for each class of carrier and related business, if the revenues collected are consistent with paragraph (2) of subdivision (a).
Within each class of carrier and related business subject to the fee, the commission shall allocate, among the members of the class, the amount of the commission’s budget to be financed by the fee based on the ratio that each member’s gross intrastate revenues bears to the total gross intrastate revenues of the class, except for railroad corporations, whose fees shall be allocated within that class in accordance with subdivision (g).
However, in the case of passenger vehicle operators, the commission may assess fees on a basis other than revenue, including, but not limited to, on a per vehicle basis, in an amount sufficient to support the regulatory activities of the commission for the passenger vehicle operators class from which the fee is collected, and to establish an appropriate reserve.
Any carrier or related business which is a member of more than one class of carrier or related business shall be subject to the fee for each class of which it is a member.
For every carrier and related business having annual gross intrastate revenues of one hundred thousand dollars ($100,000) or less, or for every railroad corporation having annual gross intrastate revenues of ten million dollars ($10,000,000) or less, the commission shall annually establish uniform fees, which shall be not less than a minimum annual fee, to be paid by each carrier and related business and by each railroad corporation, if the revenues collected are consistent with paragraph (2) of subdivision (a). Every carrier and related business and railroad corporation paying fees pursuant to this subdivision shall show proof of eligibility at the time of payment in a form the commission may specify.
The commission shall annually establish a uniform fee, which shall be not less than a minimum annual fee, to be paid by every commercial air operator and for-hire vessel operator, if the revenues collected are consistent with paragraph (2) of subdivision (a).
The commission shall establish the initial fee amount to be paid by railroad corporations subject to this section, and the regulations for the assessment and collection of the fee, no later than January 31, 1992. The commission shall collect the initial fee from railroad corporations beginning on February 1, 1992, and shall disburse the amounts collected as directed in Section 309.7, as added by Assembly Bill 684 of the 1991–92 Regular Session, and Section 421.
The commission shall establish regulations for allocating the proportionate share of the fee established pursuant to paragraph (2) of subdivision (a) to be paid by the rail corporations within that class. The regulations may utilize gross intrastate revenues; track mileage within the state; terminals located within the state; loaded car miles traveled within the state; fuel consumption; or any other measure deemed by the commission to be appropriate in allocating the fee among railroad corporations. On or before January 15, 1992, railroad corporations as a group may submit a proposed plan of allocation to the commission, which the commission shall consider in establishing the regulations.
In addition to the requirements of Section 422, the commission may establish a uniform annual fee to be paid by every charter-party carrier of passengers.
Every carrier and related business with annual gross intrastate revenues of one hundred thousand dollars ($100,000) or less, railroad corporation, commercial air operator, and for-hire vessel operator shall make payment of the fee to the commission on an annual basis on or before January 15.
Every other carrier and related business not subject to subdivision (a) shall make payment of the fee on a quarterly basis between the first and 15th days of July, October, January, and April.
Each carrier and related business subject to subdivision (b) shall, at that time, prepare and transmit a report, in the form the commission may specify, showing the gross operating revenue of the carrier or related business for the calendar quarter covered by the report together with the fee established pursuant to Section 421. In the case of a railroad corporation, the report shall address the factors identified by the commission as the basis for allocation pursuant to subdivision (g) of Section 422.
Any carrier or related business required to submit information and reports under this article may, in lieu thereof, submit copies of information or reports made to another governmental agency if all of the following requirements are met:
The alternate information or reports contain all of the information required by the commission.
The requirements to which the alternate information or reports are responsive are clearly identified.
The information or reports are certified by the carrier or related business to be true and correct.
As used in this article:
“Class” means a group of carriers or related businesses as specified by the commission for purposes of establishing the fees pursuant to this article. The commission shall create separate classes for the following: passenger vehicle operators, pipeline corporations, vessel operators, railroad corporations, and commercial air operators. Nothing in this section restricts the commission from establishing other carrier classes or from establishing other classes within the existing classes listed in this section, including classes based on the kinds of vehicles used.
“Gross intrastate revenue” includes all compensation for the transportation or storage of property or the transportation of persons when both the origin and destination of the transportation or the performance of the service is within this state, and shall not include compensation for the transportation of persons or property in interstate or foreign commerce or the transportation of vehicles by ferries. “Gross intrastate revenue,” as determined pursuant to this article, shall apply only for purposes of determining the fees required by this chapter and shall not necessarily constitute gross operating revenue for any other purpose.
“Fee” means that monetary amount determined in accordance with this article.
The employees, representatives, and inspectors of the commission may, under its order or direction, inspect and examine any books, accounts, records, memoranda, documents, papers, and correspondence kept or required to be kept by any carrier or related business referred to in this article. This section shall, to the extent deemed necessary by the commission, apply to persons who have direct or indirect control over, or who are affiliated with, any transportation agency.
The commission shall use all moneys paid into the Public Utilities Commission Transportation Reimbursement Account by charter-party carriers in connection with charter bus transportation, as defined in subdivision (b) of Section 5363, solely for the following purposes:
Safety regulation.
The administration of financial responsibility requirements.
Commission activities to ensure compliance with safety regulation and financial responsibility requirements.
Any other regulatory program permitted by Section 14501(a) of Title 49 of the United States Code.
ARTICLE 3. Other Public Utilities [431. - 435.]
The commission shall annually determine a fee to be paid by every electrical, gas, telephone, telegraph, water, sewer system, and heat corporation and every other public utility providing service directly to customers or subscribers and subject to the jurisdiction of the commission other than a railroad, except as otherwise provided in Article 2 (commencing with Section 421).
The annual fee shall be established to produce a total amount equal to that amount established in the authorized commission budget for the same year, including adjustments for increases in employee compensation, other increases appropriated by the Legislature, and an appropriate reserve to regulate public utilities less the amount to be paid from special accounts or funds pursuant to Section 402, reimbursements, federal funds, and any other revenues, and the amount of unencumbered funds from the preceding year.
This article shall not apply to any electrical cooperative as defined in Chapter 5 (commencing with Section 2776) of Part 2.
On and after January 1, 1985, this article shall apply to radiotelephone utilities as defined in Section 4902 as those provisions read on December 31, 1984.
This section shall become operative on January 1, 2020.
The commission shall establish the fee pursuant to Section 431 with the approval of the Department of Finance and in accordance with all of the following:
In its annual budget request, the commission shall specify both of the following:
The amount of its budget to be financed by the fee.
The dollar allocation of the amount of its budget shall be financed by the fee by each class of public utility subject to the fee. The fee allocation among classes of public utilities shall reflect expenditures by the commission on regulatory and other authorized activities affecting each respective class, and shall bear the same ratio that the commission’s workload for each class of public utility subject to the fee bears to the commission’s total workload for all public utilities subject to the fee.
The commission may establish different and distinct methods of assessing fees for each class of public utility, if the revenues collected are consistent with paragraph (2) of subdivision (a), except that the commission shall establish a uniform charge per kilowatt hour for sales in kilowatt hours for the class of electrical corporations and a uniform charge per therm for sales in therms for the class of gas corporations.
Within each class of public utility subject to the fee, the commission shall allocate among the members of the class the amount of its budget to be financed by the fee using the following methods:
For electrical corporations, the ratio that each corporation’s sales in kilowatt hours bears to the total sales in kilowatt hours for the class.
For gas corporations, the ratio that each corporation’s sales in therms bears to the total sales in therms for the class.
For telephone and telegraph corporations, the ratio that each corporation’s gross intrastate revenues bears to the total gross intrastate revenues for the class. If the commission determines that there is a need for consultants or advisory services to assist in determining the reasonableness of capital expenditures for a telephone corporation, the commission may adjust the fees within the class so that the expenses for the consultants and advisory services are fully allocated to that telephone corporation.
For water and sewer system corporations, the ratio that each corporation’s gross intrastate revenues bears to the total gross intrastate revenues for the class.
For all other public utilities, an appropriate measurement methodology determined by the commission.
Every public utility belonging to more than one class shall be subject to the fee for each class of which it is a member.
For every public utility with annual gross intrastate revenues of seven hundred fifty thousand dollars ($750,000) or less, the commission shall annually establish uniform fees to be paid by each such public utility, if the revenues collected thereby are consistent with paragraph (2) of subdivision (a) and subdivision (c).
Every public utility with annual gross intrastate revenues of seven hundred fifty thousand dollars ($750,000) or less shall make payment of the fee to the commission on an annual basis on or before January 15.
Every other public utility not subject to subdivision (a) shall make payment of the fee to the commission on a quarterly basis between the first and 15th days of July, October, January, and April.
The commission may require every public utility subject to this article to furnish information and reports to the commission, at the time or times it specifies, to enable it to make the allocations pursuant to Section 432.
Any public utility required to submit information and reports under this article may, in lieu thereof, submit information or reports made to any other governmental agency if all of the following are met:
The alternate information or reports contain all of the information required by the commission.
The requirements to which the alternate reports or information are responsive are clearly identified.
The information or reports are certified by the public utility to be true and correct.
As used in this article:
“Class” means a group of public utilities as specified by the commission for purposes of establishing fees pursuant to this article. The commission shall create separate classes for the following: electrical corporations, gas corporations, heat corporations, water corporations, sewer system corporations, and telephone and telegraph corporations.
“Fee” means that monetary amount determined in accordance with this article.
“Gross intrastate revenues” means those revenues from a public utility subject to the jurisdiction of the commission and accounted for according to the uniform system of accounts maintained by the commission. For purposes of this article, the amount of gross intrastate revenues of a public utility subject to the jurisdiction of the commission shall be the gross intrastate operating revenues set forth in the annual report of the public utility to the commission.
“Sales in kilowatt hours” means sales in kilowatt hours, subject to the jurisdiction of the commission, for service directly to customers and subscribers of each electrical corporation, and shall not include interdepartmental sales or transfers and sales to other privately owned or publicly owned public utilities furnishing electricity.
“Sales in therms” means deliveries of gas in therms, without regard to ownership of the gas, subject to the jurisdiction of the commission, directly to customers and subscribers of each gas corporation, except interdepartmental sales or transfers and sales to other privately owned or publicly owned public utilities furnishing electricity, gas, or heat.
ARTICLE 4. Video Service Franchises [440. - 444.]
For purposes of this article, “state franchise,” “video service,” and “video service provider” shall have the same meaning as those terms are defined in Section 5830.
The Public Utilities Commission Video Franchising Account is hereby created in the Public Utilities Commission Utilities Reimbursement Account.
The commission shall annually determine a fee to be paid by an applicant or holder of a state franchise pursuant to Division 2.5 (commencing with Section 5800). The annual fee shall be established to produce a total amount equal to that amount established in the authorized commission budget for the same year, including adjustments for increases in employee compensation, other increases appropriated by the Legislature, and an appropriate reserve to carry out the provisions of Division 2.5 (commencing with Section 5800), less the amount to be paid from reimbursements, federal funds, and any other revenues, and the amount of unencumbered funds from the preceding year.
The commission shall establish the fee pursuant to Section 441 with the approval of the Department of Finance. The commission shall specify the amount of its budget to be financed by the fee in its annual budget request.
The fee shall be determined and imposed by the commission consistent with the requirements of Section 542 of Title 47 of the United States Code.
All fees collected by the commission pursuant to this section shall be transmitted to the Treasurer at least quarterly for deposit in the Public Utilities Commission Video Franchising Account.
The commission shall maintain those records as are necessary to account separately for all fees and charges, including the fees authorized by Section 441.
The commission shall authorize refunds of the fees provided for in this article when the fees were collected in error.
The commission may require a video service provider subject to this article to furnish information and reports to the commission, at the time or times it specifies, to enable it to determine the fee pursuant to Section 441.
Any video service provider required to submit information and reports under this article may, in lieu thereof, submit information or reports made to any other governmental agency if all of the following are met:
The alternate information or reports contain all of the information required by the commission.
The requirements to which the alternate reports or information are responsive are clearly identified.
The information or reports are certified by the video service provider to be true and correct.
If a video service provider subject to this article is in default of the payment of any fee required by this article for a period of 30 days or more, the commission may suspend or revoke the state franchise of the video service provider or order the video service provider to cease and desist from conducting all operations subject to the franchising authority of the commission. The commission may estimate from all available information the appropriate fee and may add to the amount of that estimated fee, a penalty not to exceed 25 percent of the amount, on account of the failure, refusal, or neglect to prepare and submit the report or to pay the fee, and the video service provider shall be estopped to complain of the amount of the commission’s estimate.
Upon payment of the fee so estimated and penalty, if applicable, the state franchise of the video service provider suspended in accordance with this section shall be reinstated or the order to cease and desist revoked. The commission may grant a reasonable extension of the 30-day period to any video service provider upon written application and a showing of the necessity of the extension.
Upon revocation of any state franchise or issuance of an order to cease and desist pursuant to this section, all fees in default shall become due and payable immediately.
The commission may bring an action, in its own name or in the name of the people of the state, in any court of competent jurisdiction, for the collection of delinquent fees estimated under this article, or for an amount due, owing, and unpaid to it, as shown by report filed by the commission, together with a penalty of 25 percent for the delinquency.
CHAPTER 3. Rights and Obligations of Public Utilities [451. - 666.]
ARTICLE 1. Rates [451. - 468.]
All charges demanded or received by any public utility, or by any two or more public utilities, for any product or commodity furnished or to be furnished or any service rendered or to be rendered shall be just and reasonable. Every unjust or unreasonable charge demanded or received for such product or commodity or service is unlawful.
Every public utility shall furnish and maintain such adequate, efficient, just, and reasonable service, instrumentalities, equipment, and facilities, including telephone facilities, as defined in Section 54.1 of the Civil Code, as are necessary to promote the safety, health, comfort, and convenience of its patrons, employees, and the public.
All rules made by a public utility affecting or pertaining to its charges or service to the public shall be just and reasonable.
For purposes of this section, the following terms have the following meanings:
“Covered wildfire” has the same meaning as defined in Section 1701.8.
“Wildfire Fund” means the Wildfire Fund created pursuant to Section 3284.
When determining an application by an electrical corporation to recover costs and expenses arising from a covered wildfire, the commission shall allow cost recovery if the costs and expenses are just and reasonable. Costs and expenses arising from a covered wildfire are just and reasonable if the conduct of the electrical corporation related to the ignition was consistent with actions that a reasonable utility would have undertaken in good faith under similar circumstances, at the relevant point in time, and based on the information available to the electrical corporation at the relevant point in time. Reasonable conduct is not limited to the optimum practice, method, or act to the exclusion of others, but rather encompasses a spectrum of possible practices, methods, or acts consistent with utility system needs, the interest of the ratepayers, and the requirements of governmental agencies of competent jurisdiction. Costs and expenses in the application may be allocated for cost recovery in full or in part taking into account factors both within and beyond the utility’s control that may have exacerbated the costs and expenses, including humidity, temperature, and winds.
An electrical corporation bears the burden to demonstrate, based on a preponderance of the evidence, that its conduct was reasonable pursuant to subdivision (b) unless it has a valid safety certification pursuant to Section 8389 for the time period in which the covered wildfire that is the subject of the application ignited. If the electrical corporation has received a valid safety certification for the time period in which the covered wildfire ignited, an electrical corporation’s conduct shall be deemed to have been reasonable pursuant to subdivision (b) unless a party to the proceeding creates a serious doubt as to the reasonableness of the electrical corporation’s conduct. Once serious doubt has been raised, the electrical corporation has the burden of dispelling that doubt and proving the conduct to have been reasonable.
If an electrical corporation has drawn amounts from the Wildfire Fund for eligible claims for a covered wildfire, then the electrical corporation shall file an application to recover costs and expenses pursuant to Section 1701.8 after it has paid substantially all third-party liability claims arising from the covered wildfire.
Notwithstanding Section 451, this section shall direct the commission’s evaluation of applications for recovery of costs and expenses arising from a covered wildfire. This section shall not apply to any other applications for cost recovery.
This section shall not affect any civil action, appeal, or other action or proceeding.
This section shall become inoperative if Section 3292 becomes inoperative pursuant to subdivision (k) of that section and this section shall be repealed on the first January 1 more than three months after this section becomes inoperative. The commission shall notify the Secretary of State as to whether this section becomes inoperative and is repealed.
In an application by an electrical corporation to recover costs and expenses arising from, or incurred as a result of, a catastrophic wildfire with an ignition date in the 2017 calendar year, the commission shall determine whether those costs and expenses are just and reasonable in accordance with Section 451.
Notwithstanding Section 451, when allocating costs, the commission shall consider the electrical corporation’s financial status and determine the maximum amount the corporation can pay without harming ratepayers or materially impacting its ability to provide adequate and safe service. The commission shall ensure that the costs or expenses described in subdivision (a) that are disallowed for recovery in rates assessed for the wildfires, in the aggregate, do not exceed that amount.
An electrical corporation may apply for a financing order pursuant to Article 5.8 (commencing of Section 850) of Chapter 4 for the amount of costs and expenses allocated to the ratepayer as just and reasonable or as disallowed for recovery but exceeding the amount determined pursuant to subdivision (b).
If the commission finds that an electrical corporation is requesting recovery of costs that were previously authorized by the commission for cost recovery by the electrical corporation, the commission may fine the electrical corporation an amount up to three times the amount of the penalty provided in Section 2107 for each violation.
Any expense resulting from a bonus paid to an executive officer of a public utility that has ceased to pay its debts in the ordinary course of business shall not be recoverable either directly or indirectly in rates and shall be borne exclusively by the shareholders of the public utility. This prohibition shall be operative for a period of no less than two years after the public utility resumes paying its debts in the ordinary course of business, and shall be operative for any additional time period as determined by the commission.
The requirements of subdivision (a) do not apply to a bonus that is specifically defined in a standard employee compensation contract.
For purposes of this section, “executive officer” means any person who performs policy making functions and is employed by the public utility subject to the approval of the board of directors, and includes the president, secretary, treasurer, and any vice president in charge of a principal business unit, division, or function of the public utility.
Nonbypassable or departing load surcharges, as defined by the commission, shall not apply to a reduction in kilowatthours of electricity that an electrical corporation customer consumes from the electrical grid in a metered interval due to industrial process heat recovery technology, up to a cap established by the commission.
In order to receive the exemption pursuant to subdivision (a), the industrial process heat recovery technology shall meet all of the following requirements:
The industrial process heat recovered to produce electricity is integral to the industrial process.
The industrial process heat recovered to produce electricity is created by the industrial process.
No supplemental firing or fuel use occurs to increase or to stabilize the steam’s temperature.
The electricity generated by the industrial process heat recovery technology has zero marginal greenhouse gas emissions associated with it.
The electricity generated by the industrial process heat recovery technology is fully self-consumed onsite during a manufacturing process.
The electricity generated by the industrial process heat recovery technology is not exported to the electrical grid for sale into the wholesale market.
The electricity generated by the industrial process heat recovery technology does not exceed 25 percent of the installing customer’s peak electrical load at the time of installation.
The industrial process heat recovery technology has a minimum nameplate rating of 500 kilowatts.
The industrial process heat recovery technology is installed on or after January 1, 2024.
In implementing the exemption in subdivision (a), the commission shall minimize the cost impacts to all nonparticipating customers that are directly attributable to the nonbypassable or departing load charges of customers using industrial process heat recovery technology pursuant to subdivision (b).
For purposes of this section, the following definitions apply:
Following the approval of each general rate case, the commission shall review which costs, if any, differed from the general rate case forecasts for each electrical corporation or gas corporation. The commission shall adjust the authorized revenue requirement in the subsequent general rate case, as appropriate, based on the actual past costs the corporation records.
The commission shall establish guidelines for electrical corporations and gas corporations to calculate and report their actual rates of return to the commission.
The commission shall require electrical corporations and gas corporations to report their actual rates of return to the commission annually.
The commission shall adopt processes to adequately track an electrical corporation’s or gas corporation’s actual rate of return relative to its forecasted rate of return and shall require the corporation to identify the cost categories where projected costs differed from actual costs.
This section does not restrict, limit, or otherwise affect the commission’s obligation to ensure that rates are sufficient to enable an electrical corporation or gas corporation to recover a just and reasonable amount of revenue, pursuant to Section 451, including a reasonable return.
Notwithstanding Section 451, a gas corporation may cease providing service in an area within its service territory where a pilot project has been implemented pursuant to Section 663 if the commission determines that adequate substitute energy service is reasonably available to support the energy end uses of affected gas corporation customers.
In determining what constitutes adequate substitute energy service and when the substitute energy service is reasonably available, the commission shall adopt guidelines necessary to ensure that the rates for substitute energy service are just and reasonable as provided by a load-serving entity as the provider of last resort pursuant to Section 387.
The commission may authorize a gas corporation to recover the undepreciated costs of any gas plant or asset, including the cost to retire the gas plant or asset that will no longer be used and useful. The commission shall determine the just and reasonable recovery of undepreciated costs, including the period over which the undepreciated costs are recovered so as to minimize impacts to remaining gas distribution system customers.
This section does not modify the authority of the commission to determine adequate, efficient, just, and reasonable service.
Paragraph (1) does not affect the authority of the commission under this section to relieve a gas corporation of its obligation to provide service within the approved boundary of a pilot project approved pursuant to Section 663 that is pending as of January 1, 2031.
Nothing in this part shall be construed to prohibit any common carrier from establishing and charging a lower than a maximum reasonable rate for the transportation of property when the needs of commerce or public interest require. However, no common carrier subject to the jurisdiction of the commission may establish a rate less than a maximum reasonable rate for the transportation of property for the purpose of meeting the competitive charges of other carriers or the cost of other means of transportation which is less than the charges of competing carriers or the cost of transportation which might be incurred through other means of transportation, except upon such showing as is required by the commission and a finding by it that the rate is justified by transportation conditions. In determining the extent of such competition the commission shall make due and reasonable allowance for added or accessorial service performed by one carrier or agency of transportation which is not contemporaneously performed by the competing agency of transportation.
No public utility shall, as to rates, charges, service, facilities, or in any other respect, make or grant any preference or advantage to any corporation or person or subject any corporation or person to any prejudice or disadvantage.
No public utility shall prejudice, disadvantage, or require different rates or deposit amounts from a person because of ancestry, medical condition, marital status or change in marital status, occupation, or any characteristic listed or defined in Section 11135 of the Government Code. A person who has exhausted all administrative remedies with the commission may institute a suit for injunctive relief and reasonable attorney’s fees in cases of an alleged violation of this subdivision. If successful in litigation, the prevailing party shall be awarded attorney’s fees.
No public utility shall establish or maintain any unreasonable difference as to rates, charges, service, facilities, or in any other respect, either as between localities or as between classes of service.
No public utility shall include with any bill for services or commodities furnished any customer or subscriber any advertising or literature designed or intended (1) to promote the passage or defeat of a measure appearing on the ballot at any election whether local, statewide, or national, (2) to promote or defeat any candidate for nomination or election to any public office, (3) to promote or defeat the appointment of any person to any administrative or executive position in federal, state, or local government, or (4) to promote or defeat any change in federal, state, or local legislation or regulations.
The commission may determine any question of fact arising under this section.
Whenever the commission orders rate refunds to be distributed, the commission shall require public utilities to pay refunds to all current utility customers, and, when practicable, to prior customers, on an equitable pro rata basis without regard as to whether or not the customer is classifiable as a residential or commercial tenant, landlord, homeowner, business, industrial, educational, governmental, nonprofit, agricultural, or any other type of entity.
For the purposes of this section, “equitable pro rata basis” shall mean in proportion to the amount originally paid for the utility service involved, or in proportion to the amount of such utility service actually received.
Nothing in this section shall prevent the commission from authorizing refunds to residential and other small customers to be based on current usage.
Except as provided in Section 455, a public utility shall not change any rate or so alter any classification, contract, practice, or rule as to result in any new rate, except upon a showing before the commission and a finding by the commission that the new rate is justified. Whenever any electrical, gas, heat, telephone, water, or sewer system corporation files an application to change any rate, other than a change reflecting and passing through to customers only new costs to the corporation which do not result in changes in revenue allocation, for the services or commodities furnished by it, the corporation shall furnish to its customers affected by the proposed rate change notice of its application to the commission for approval of the new rate. This notice requirement does not apply to any rate change proposed by a corporation pursuant to an advice letter submitted to the commission in accordance with commission procedures for this means of submission. The procedures for advice letters may include provision for notice to customers or subscribers on a case-by-case basis, as determined by the commission. The corporation may include the notice with the regular bill for charges transmitted to the customers within 45 days if the corporation operates on a 30-day billing cycle, or within 75 days if the corporation operates on a 60-day billing cycle. If more than one application to change any rate is filed within a single billing cycle, the corporation may combine the notices into a single notice if the applications are separately identified. The notice shall state the amount of the proposed rate change expressed in both dollar and percentage terms for the entire rate change as well as for each customer classification, a brief statement of the reasons the change is required or sought, and the mailing, and if available, the email address of the commission to which any customer inquiries may be directed regarding how to participate in, or receive further notices regarding the date, time, or place of, any hearing on the application, and the mailing address of the corporation to which any customer inquiries relative to the proposed rate change may be directed.
For a water corporation with more than 2,000 service connections, the notice required in subdivision (a) shall include estimated rate impacts on the various customer classes of the corporation. The commission may require the corporation to inform customers in a separate letter or through a bill insert, at the corporation’s discretion, of the outcome of the general rate case, within 60 days if the corporation operates on a 30-day billing cycle, or within 90 days if the corporation operates on a 60-day billing cycle, of the commission’s final decision, including the approved rates and the approved capital projects that will subsequently be executed by way of an advice letter.
The commission may adopt rules it considers reasonable and proper for each class of public utility providing for the nature of the showing required to be made in support of proposed rate changes, the form and manner of the presentation of the showing, with or without a hearing, and the procedure to be followed in the consideration thereof. Rules applicable to common carriers may provide for the publication and filing of any proposed rate change together with a written showing in support thereof, giving notice of the filing and showing in support thereof to the public, granting an opportunity for protests thereto, and to the consideration of, and action on, the showing and any protests filed thereto by the commission, with or without hearing. However, the proposed rate change does not become effective until it has been approved by the commission.
The commission shall permit individual public utility customers and subscribers affected by a proposed rate change, and organizations formed to represent their interests, to testify at any hearing on the proposed rate change, except that the presiding officer need not allow repetitive or irrelevant testimony and may conduct the hearing in an efficient manner.
Except as provided in subdivision (b), if a customer with a maximum peak electrical demand in excess of 20 kilowatts located or planning to locate within the service territory of an electrical corporation receives a bona fide offer for electric service from an irrigation district at rates less than the electrical corporation’s tariffed rates, the electrical corporation may discount its noncommodity rates, but may not discount its noncommodity rates below its distribution marginal cost of serving that customer. For purposes of this subdivision, the costs of the electric commodity shall be excluded from both the irrigation district and electric corporation’s rates. The electrical corporation may recover any difference between its tariffed and discounted service from its remaining customers, allocated as determined by the commission. However, the reallocation may not increase rates to its remaining customers by any greater amount than the rates would be increased if the customer had taken electric distribution service from the irrigation district and the irrigation district had paid the charge established in subdivision (e) of Section 9607. Further, there shall be a firewall preventing the reallocation of such differences resulting from discounting to residential customers or to commercial customers with maximum peak demands not in excess of 20 kilowatts.
Subdivision (a) does not apply to a cumulative 75 megawatts of load served by the Merced Irrigation District, determined as follows:
The load is located within the boundaries of Merced Irrigation District, as those boundaries existed on December 20, 1995, together with the territory of Castle Air Force Base which was located outside the district on that date.
For purposes of this section, a megawatt of load shall be calculated in accordance with the methodology established by the Energy Commission in its Docket No. 96-IRR-1890.
Subdivision (a) applies to the load of customers that move to the areas described in paragraph (1) of subdivision (b) after December 31, 2000, and such load shall be excluded from the calculation of the 75 megawatts in subdivision (b).
If an electrical corporation seeks to apply the discounts permitted under subdivision (a) within the geographic area described in subdivision (b) of Section 9610, the electrical corporation’s resulting rate for distribution service may not be less than 120 percent of the electrical corporation’s marginal distribution cost of serving that customer.
Notwithstanding Section 454, the commission may establish a “zone of rate freedom” for any passenger stage transportation service which is operating in competition with other passenger transportation service from any means of transportation, if the competition together with the authorized zone of rate freedom will result in reasonable rates and charges for the passenger stage transportation service. An adjustment in rates or charges within a zone of rate freedom established by the commission is hereby deemed just and reasonable. The commission may, upon protest or on its own motion, suspend any adjustment in rates or charges under this section and institute proceedings under its rules of practice and procedure.
The commission may, after a hearing, approve an increase of from one-half of 1 percent to 1 percent in the rate of return otherwise allowed an electrical corporation on its electric plant for investment by the corporation in facilities meeting one of the following requirements:
The facility is designed to generate electricity from a renewable resource, including, but not limited to, solar energy, geothermal steam, wind, and hydroelectric power at new or existing dams; the facility is subject to Resources Agency review of its environmental impacts and determination that the facility is environmentally acceptable; its capital costs, when added to its costs of operation and maintenance, result in a cost of electricity generated over the useful life of the facility less than that of electricity generated by existing facilities utilizing nuclear power or fossil fuel; and the facility is used and useful.
The facility is capable of meeting the then applicable environmental pollution standards; its capital costs, when added to its costs of operation and maintenance, result in a cost of electricity generated over the useful life of the facility less than that of electricity generated by existing facilities utilizing nuclear power or fossil fuel; and the facility is used and useful.
The facility is experimental and is, in the determination of the commission, reasonably designed to improve or perfect technology for the generation of electricity from renewable resources or to more efficiently utilize other resources in a manner which will decrease environmental pollution from and lower the costs of the electricity generated.
The commission shall establish rates for gas which is utilized in cogeneration technology projects not higher than the rates established for gas utilized as a fuel by an electric plant in the generation of electricity, except that this rate shall apply only to that quantity of gas which an electrical corporation serving the area where a cogeneration technology project is located, or an equivalent area, would require in the generation of an equivalent amount of electricity based on the corporation’s average annual incremental heat rate and reasonable transmission losses or that quantity of gas actually consumed by the cogeneration technology project in the sequential production of electricity and steam, heat, or useful work, whichever is the lower quantity.
The commission shall specify the allocation of electricity, including quantity, characteristics, and duration of electricity delivery, that the Department of Water Resources shall provide under its power purchase agreements to the customers of each electrical corporation, which shall be reflected in the electrical corporation’s proposed procurement plan. Each electrical corporation shall file a proposed procurement plan with the commission not later than 60 days after the commission specifies the allocation of electricity. The proposed procurement plan shall specify the date that the electrical corporation intends to resume procurement of electricity for its retail customers, consistent with its obligation to serve. After the commission’s adoption of a procurement plan, the commission shall allow not less than 60 days before the electrical corporation resumes procurement pursuant to this section.
An electrical corporation’s proposed procurement plan shall include, but not be limited to, all of the following:
An assessment of the price risk associated with the electrical corporation’s portfolio, including any utility-retained generation, existing power purchase and exchange contracts, and proposed contracts or purchases under which an electrical corporation will procure electricity, electricity demand reductions, and electricity-related products and the remaining open position to be served by spot market transactions.
A definition of each electricity product, electricity-related product, and procurement-related financial product, including support and justification for the product type and amount to be procured under the plan.
The duration of the plan.
The duration, timing, and range of quantities of each product to be procured.
A competitive procurement process under which the electrical corporation may request bids for procurement-related services, including the format and criteria of that procurement process.
An incentive mechanism, if any incentive mechanism is proposed, including the type of transactions to be covered by that mechanism, their respective procurement benchmarks, and other parameters needed to determine the sharing of risks and benefits.
The upfront standards and criteria by which the acceptability and eligibility for rate recovery of a proposed procurement transaction will be known by the electrical corporation before execution of the transaction. This shall include an expedited approval process for the commission’s review of proposed contracts and subsequent approval or rejection of a contract. The electrical corporation shall propose alternative procurement choices in the event a contract is rejected.
Procedures for updating the procurement plan.
A showing that the procurement plan will achieve the following:
The electrical corporation, in order to fulfill its unmet resource needs, shall procure resources from eligible renewable energy resources in an amount sufficient to meet its procurement requirements pursuant to the California Renewables Portfolio Standard Program (Article 16 (commencing with Section 399.11) of Chapter 2.3).
The electrical corporation shall create or maintain a diversified procurement portfolio consisting of both short-term and long-term electricity and electricity-related and demand reduction products.
The electrical corporation shall first meet its unmet resource needs through all available energy efficiency and demand reduction resources that are cost effective, reliable, and feasible.
In determining the availability of cost-effective, reliable, and feasible demand reduction resources, the commission shall consider the findings regarding technically and economically achievable demand reduction in the Demand Response Potential Study required pursuant to Commission Order D.14-12-024, to the extent those findings are not superseded by other demand reduction studies conducted by academic institutions or government agencies, and to the extent that any demand reduction is consistent with commission policy.
The electrical corporation, in soliciting bids for new gas-fired generating units, shall actively seek bids for resources that are not gas-fired generating units located in communities that suffer from cumulative pollution burdens, including, but not limited to, high emission levels of toxic air contaminants, criteria air pollutants, and greenhouse gases.
In considering bids for, or negotiating contracts for, new gas-fired generating units, the electrical corporation shall provide greater preference to resources that are not gas-fired generating units located in communities that suffer from cumulative pollution burdens, including, but not limited to, high emission levels of toxic air contaminants, criteria air pollutants, and greenhouse gases.
This subparagraph does not apply to contracts signed by an electrical corporation and approved by the commission before January 1, 2017.
The electrical corporation’s risk management policy, strategy, and practices, including specific measures of price stability.
A plan to achieve appropriate increases in diversity of ownership and diversity of fuel supply of nonutility electrical generation.
A mechanism for recovery of reasonable administrative costs related to procurement in the generation component of rates.
The commission shall review and accept, modify, or reject each electrical corporation’s procurement plan and any amendments or updates to the plan. The commission shall ensure that the plan contains the elements required by this section, including the elements described in subparagraphs (C) and (D) of paragraph (9) of subdivision (b). The commission’s review shall consider each electrical corporation’s individual procurement situation, and shall give strong consideration to that situation in determining which one or more of the features set forth in this subdivision shall apply to that electrical corporation. A procurement plan approved by the commission shall contain one or more of the following features, provided that the commission may not approve a feature or mechanism for an electrical corporation if it finds that the feature or mechanism would impair the restoration of an electrical corporation’s creditworthiness or would lead to a deterioration of an electrical corporation’s creditworthiness:
A procurement plan approved by the commission shall accomplish each of the following objectives:
The commission shall provide for the periodic review and prospective modification of an electrical corporation’s procurement plan.
The commission may engage an independent consultant or advisory service to evaluate risk management and strategy. The reasonable cost of any consultant or advisory service is a reimbursable expense and eligible for funding pursuant to Section 631.
The commission shall adopt appropriate procedures to ensure the confidentiality of any market sensitive information submitted in an electrical corporation’s proposed procurement plan or resulting from or related to its approved procurement plan, including, but not limited to, proposed or executed power purchase agreements, data request responses, or consultant reports, or any combination of these, provided that the Public Advocate’s Office of the Public Utilities Commission and other consumer groups that are nonmarket participants shall be provided access to this information under confidentiality procedures authorized by the commission.
This section does not alter, modify, or amend the commission’s oversight of affiliate transactions under its rules and decisions or the commission’s existing authority to investigate and penalize an electrical corporation’s alleged fraudulent activities, or to disallow costs incurred as a result of gross incompetence, fraud, abuse, or similar grounds. This section does not expand, modify, or limit the Energy Commission’s existing authority and responsibilities as set forth in Sections 25216, 25216.5, and 25323 of the Public Resources Code.
An electrical corporation that serves less than 500,000 electric retail customers within the state may file with the commission a request for exemption from this section, which the commission shall grant upon a showing of good cause.
Before its approval pursuant to Section 851 of any divestiture of generation assets owned by an electrical corporation on or after September 24, 2002, the commission shall determine the impact of the proposed divestiture on the electrical corporation’s procurement rates and shall approve a divestiture only to the extent it finds, taking into account the effect of the divestiture on procurement rates, that the divestiture is in the public interest and will result in net ratepayer benefits.
Any electrical corporation’s procurement necessitated as a result of the divestiture of generation assets on or after September 24, 2002, shall be subject to the mechanisms and procedures set forth in this section only if its actual cost is less than the recent historical cost of the divested generation assets.
Notwithstanding paragraph (2), the commission may deem proposed procurement eligible to use the procedures in this section upon its approval of asset divestiture pursuant to Section 851.
The commission shall direct electrical corporations to include in their proposed procurement plans the integration costs described and determined pursuant to clause (v) of subparagraph (A) of paragraph (5) of subdivision (a) of Section 399.13.
Before approving an electrical corporation’s contract for any new gas-fired generating unit, the commission shall require the electrical corporation to demonstrate compliance with its approved procurement plan.
The commission shall do all of the following:
Identify a diverse and balanced portfolio of resources needed to ensure a reliable electricity supply that provides optimal integration of renewable energy and resource diversity in a cost-effective manner. The portfolio shall be used by the commission to establish integrated resource planning-based procurement requirements that rely on zero-carbon-emitting resources to the maximum extent reasonable and be designed to achieve the state policy specified in Section 454.53 and any statewide greenhouse gas emissions limit established pursuant to the California Global Warming Solutions Act of 2006 (Division 25.5 (commencing with Section 38500) of the Health and Safety Code) or any successor legislation.
Direct each electrical corporation to include, as part of its proposed procurement plan, a strategy for procuring best-fit and least-cost resources to satisfy the portfolio needs identified by the commission pursuant to subdivision (a).
Ensure that the net costs of any incremental renewable energy integration resources or diverse resources, procured by an electrical corporation to satisfy the need identified in subdivision (a) are allocated on a fully nonbypassable basis consistent with the treatment of costs identified in paragraph (2) of subdivision (c) of Section 365.1.
Permit community choice aggregators to submit proposals for satisfying their portion of the renewable integration and diverse resources need identified in subdivision (a). If the commission finds this need is best met through long-term procurement commitments for resources, community choice aggregators shall also be required to make long-term commitments for resources. The commission shall approve proposals pursuant to this subdivision if it finds all of the following:
The resources proposed by a community choice aggregator will provide equivalent integration of renewable energy.
The resources proposed by a community choice aggregator will promote the efficient achievement of state energy policy objectives, including reductions in greenhouse gas emissions.
Bundled customers of an electrical corporation will be indifferent from the approval of the community choice aggregator proposals.
Ensure that all costs resulting from nonperformance to satisfy the need identified in subdivision (a) or (d), as applicable, shall be borne by the load-serving entity, as defined in Section 380, that failed to perform.
Beginning in 2017, and to be updated regularly thereafter, the commission shall adopt a process for each load-serving entity to file an integrated resource plan, and a schedule for periodic updates to the plan, and shall ensure that load-serving entities do all of the following:
Meet the greenhouse gas emissions reduction targets established by the State Air Resources Board, in coordination with the commission and the Energy Commission, for the electricity sector and each load-serving entity that reflect the electricity sector’s percentage in achieving the economywide greenhouse gas emissions reductions pursuant to Section 38566 of the Health and Safety Code.
Enable each electrical corporation to fulfill its obligation to serve its customers at just and reasonable rates.
Minimize impacts on ratepayers’ bills.
Ensure system and local reliability on a short-term, midterm, and long-term basis, including meeting the short-term and forecast long-term resource adequacy requirements of Section 380, and require sufficient, predictable resource procurement and development to avoid unplanned energy supply shortfalls by taking into account impacts due to climate change, forecasted levels of building and transportation electrification, and other factors that can result in those shortfalls.
In furtherance of avoiding unplanned energy supply shortfalls or expensive emergency procurement and ensuring a more accurate understanding of electrical grid operational needs, the commission shall aggregate reported short-term and midterm resource procurement from all load-serving entities conducted under Section 380 or this section and assess midterm resource sufficiency, and annually provide anonymized reports to the Independent System Operator. The commission shall report forward resource procurement using counting conventions that provide the data to the Independent System Operator to be used in its grid planning.
To accomplish clause (i), the commission shall, as part of the integrated planning process, assess short-term, midterm, and long-term reliability by conducting probabilistic reliability modeling, including if there is sufficient capacity available for procurement in the short term and midterm by all load-serving entities to meet their procurement requirements. The commission shall review the results of that reliability modeling in a public proceeding at the same frequency as the forecast conducted in accordance with this section. When modeling short-term and midterm reliability, the commission shall model all procurement consistent with clause (ii) and may rely upon or incorporate probabilistic reliability modeling conducted by the Energy Commission into the commission’s public process. The commission shall also report the modeling results in the joint Reliability Planning Assessments conducted under Section 25233 of the Public Resources Code.
Comply with paragraph (1) of subdivision (b) of Section 399.13.
Strengthen the diversity, sustainability, and resilience of the bulk transmission and distribution systems, and local communities.
Enhance distribution systems and demand-side energy management.
Minimize localized air pollutants and other greenhouse gas emissions, with early priority on disadvantaged communities identified pursuant to Section 39711 of the Health and Safety Code.
Maintain a diverse portfolio of energy resources, which may include eligible energy resources procured by the Department of Water Resources.
The commission may authorize all source procurement for load-serving entities that includes various resource types including demand-side resources, supply-side resources, and resources that may be either demand-side resources or supply-side resources, taking into account the differing load-serving entities’ geographic service areas, to ensure that each load-serving entity meets the goals set forth in paragraph (1).
The commission may approve procurement of resource types that will reduce the overall emissions of greenhouse gases from the electricity sector and meet the other goals specified in paragraph (1), but due to the nature of the technology or fuel source may not compete favorably in price against other resources over the time period of the integrated resource plan.
In furtherance of the requirements of paragraph (1), the commission shall consider the role of existing renewable generation, grid operational efficiencies, energy storage, and distributed energy resources, including energy efficiency, in helping to ensure each load-serving entity meets energy needs and reliability needs in hours to encompass the hour of peak demand of electricity, excluding demand met by variable renewable generation directly connected to a California balancing authority, as defined in Section 399.12, while reducing the need for new electricity generation resources and new transmission resources in achieving the state’s energy goals at the least cost to ratepayers.
On or before September 1, 2024, and consistent with the process and schedule adopted pursuant to paragraph (1), the commission, in consultation with the Energy Commission and the Independent System Operator, shall determine if there is a need for the procurement of eligible energy resources based on a review of the integrated resource plans submitted by load-serving entities in compliance with the requirements of this section and Section 454.53 and the progress towards meeting the portfolio of resources identified pursuant to subdivision (a) of Section 454.51.
If the commission determines that there is a need for the procurement of eligible energy resources, the commission shall specify the eligible energy resources that should be procured to meet that need.
Within six months of determining that there is a need for the procurement of eligible energy resources, the commission may request the Department of Water Resources to exercise its central procurement function to procure those eligible energy resources specified pursuant to subparagraph (B) that meet the portfolio of resources identified in subdivision (a) of Section 454.51.
Upon receiving a request pursuant to subparagraph (C), the Department of Water Resources, before January 1, 2035, may exercise its central procurement function to conduct one or more competitive solicitations and enter into contracts to procure eligible energy resources in order to achieve the policy of the state specified in Section 454.53.
Any contract entered into by the Department of Water Resources pursuant to clause (i) and approved by the commission pursuant to Section 80821 of the Water Code before January 1, 2035, shall remain in force for the duration of the contract.
The Department of Water Resources’ exercising of its central procurement function to procure eligible energy resources pursuant to this paragraph shall be conducted in accordance with Division 29.5 (commencing with Section 80800) of the Water Code.
Each load-serving entity shall prepare and file an integrated resource plan consistent with paragraph (2) of subdivision (a) on a time schedule directed by the commission and subject to commission review.
Each electrical corporation’s plan shall follow Section 454.5.
The plan of a community choice aggregator shall be submitted to its governing board for approval and provided to the commission for certification, consistent with paragraph (5) of subdivision (a) of Section 366.2, and shall achieve all of the following:
Economic, reliability, environmental, security, and other benefits and performance characteristics that are consistent with the goals set forth in paragraph (1) of subdivision (a).
A diversified procurement portfolio consisting of short-term, midterm, and long-term electricity, electricity-related, and demand reduction products.
The resource adequacy requirements established pursuant to Section 380.
The plan of an electric service provider shall achieve the goals set forth in paragraph (1) of subdivision (a) through a diversified portfolio consisting of short-term, midterm, and long-term electricity, electricity-related, and demand reduction products.
To the extent that additional procurement is authorized for the electrical corporation in the integrated resource plan or the procurement process authorized pursuant to Section 454.5, the commission shall ensure that the costs are allocated in a fair and equitable manner to all customers consistent with Section 454.51, that there is no cost shifting among customers of load-serving entities, and that community choice aggregators may self-provide renewable integration resources consistent with Section 454.51. The commission may order the procurement of resources with specific attributes by load-serving entities as a result of the integrated resource planning process and shall enforce any resource procurement requirements on a nondiscriminatory basis. Enforcement may include the assessment of penalties for noncompliance.
To eliminate redundancy and increase efficiency, the process adopted pursuant to subdivision (a) shall incorporate, and not duplicate, any other planning processes of the commission.
This section applies to an electrical cooperative, as defined in Section 2776, only if the electrical cooperative has an annual electrical demand exceeding 700 gigawatthours, as determined based on a three-year average commencing with January 1, 2013.
The commission shall not include the energy, capacity, or any attribute from Diablo Canyon Unit 1 beyond November 1, 2024, or Unit 2 beyond August 26, 2025, in the adopted integrated resource plan portfolios, resource stacks, or preferred system plans.
The commission shall disallow a load-serving entity from including in their adopted integrated resource plan any energy, capacity, or any attribute from the Diablo Canyon Unit 1 beyond November 1, 2024, or Unit 2 beyond August 26, 2025.
For a thermal powerplant that uses nuclear fission technology not constructed in the twenty-first century, all resource attributes shall be retired on January 1, 2031, and shall be reported as a separate, line item resource for purposes of complying with Section 398.4.
Only a new energy resource that meets all of the following requirements is eligible to be procured by the Department of Water Resources pursuant to this section:
The resource directly supports attainment of the goals specified in Section 454.53 without increasing the state’s dependence on any fossil fuel-based resources.
The resource is determined by the commission to not be under contract at sufficient levels as shown in load-serving entities’ most recent individual integrated resource plans submitted to and reviewed by the commission pursuant to this section to achieve the goals specified in Section 454.53.
The resource has a construction and development lead time of at least five years.
The resource does not generate electricity using fossil fuels or fuels derived from fossil fuels.
The resource does not use combustion to generate electricity, unless that combustion use is ancillary and necessary to facilitate geothermal electricity generation.
Resources from a pump hydroelectric facility may be procured by the Department of Water Resources pursuant to this section if the pump hydroelectric facility does not exceed 500 megawatts and has been directly appropriated funding by the state before January 1, 2023.
For purposes of this section, the following definitions apply:
“Midterm” means a time period between two and five years in the future.
“Short term” means a time period between the present and two years in the future.
It is the policy of the state that eligible renewable energy resources and zero-carbon resources supply 90 percent of all retail sales of electricity to California end-use customers by December 31, 2035, 95 percent of all retail sales of electricity to California end-use customers by December 31, 2040, 100 percent of all retail sales of electricity to California end-use customers by December 31, 2045, and 100 percent of electricity procured to serve all state agencies by December 31, 2035. The achievement of this policy for California shall not increase carbon emissions elsewhere in the western grid and shall not allow resource shuffling. The commission and Energy Commission, in consultation with the State Air Resources Board, shall take steps to ensure that a transition to a zero-carbon electric system for the State of California does not cause or contribute to greenhouse gas emissions increases elsewhere in the western grid, and is undertaken in a manner consistent with clause 3 of Section 8 of Article I of the United States Constitution. The commission, the Energy Commission, the State Air Resources Board, and all other state agencies shall incorporate this policy into all relevant planning.
The commission, Energy Commission, State Air Resources Board, and all other state agencies shall ensure that actions taken in furtherance of subdivision (a) do all of the following:
Maintain and protect the safety, reliable operation, and balancing of the electric system.
Prevent unreasonable impacts to electricity, gas, and water customer rates and bills resulting from implementation of this section, taking into full consideration the economic and environmental costs and benefits of renewable energy and zero-carbon resources.
To the extent feasible and authorized under law, lead to the adoption of policies and taking of actions in other sectors to obtain greenhouse gas emission reductions that ensure equity between other sectors and the electricity sector.
Not affect in any manner the rules and requirements for the oversight of, and enforcement against, retail sellers and local publicly owned utilities pursuant to the California Renewables Portfolio Standard Program (Article 16 (commencing with Section 399.11) of Chapter 2.3) and Sections 454.51, 454.52, 9621, and 9622.
Not consider the energy, capacity, or any attribute from the Diablo Canyon Unit 1 or Unit 2 powerplant after August 26, 2025, in achieving the policy described in subdivision (a).
This section does not affect a retail seller’s obligation to comply with the federal Public Utility Regulatory Policies Act of 1978 (16 U.S.C. Sec. 2601 et seq.).
The commission, Energy Commission, and State Air Resources Board shall use programs authorized under existing statutes to achieve the policy described in subdivision (a).
This section does not authorize the commission to establish any requirements on a nonmobile self-cogeneration or cogeneration facility that served onsite load, or that served load pursuant to an over-the-fence arrangement if that arrangement existed on or before December 20, 1995.
This section does not limit any entity, including local governments, from accelerating their achievement of the state’s electric sector decarbonization targets.
In addition to the requirements of Section 454.52, the integrated resource plan of each load-serving entity shall contribute to a diverse and balanced portfolio of resources needed to ensure a reliable electricity supply that provides optimal integration of renewable energy resources in a cost-effective manner, meets the emissions reduction targets for greenhouse gases described in subparagraph (A) of paragraph (1) of subdivision (a) of Section 454.52, and prevents cost shifting among load-serving entities.
The commission, in consultation with the Energy Commission, shall identify all potentially achievable cost-effective electricity efficiency savings and establish efficiency targets for an electrical corporation to achieve, pursuant to Section 454.5, consistent with the targets established pursuant to subdivision (c) of Section 25310 of the Public Resources Code.
By July 1, 2018, and every four years thereafter, each electrical corporation shall report on its progress toward achieving the targets established pursuant to paragraph (1).
By December 31, 2023, the commission shall, in a new or existing proceeding, undertake a comprehensive review of the feasibility, costs, barriers, and benefits of achieving a cumulative doubling of energy efficiency savings and demand reduction by 2030 pursuant to subdivision (c) of Section 25310 of the Public Resources Code.
Notwithstanding subdivision (c) of Section 25310 of the Public Resources Code, if the commission concludes the targets established for electrical corporations to achieve pursuant to subdivision (a) are not cost effective, feasible, or pose potential adverse impacts to public health and safety, the commission shall revise the targets to the level that optimizes the amount of energy efficiency savings and demand reduction and shall modify, revise, or update its policies as needed to address barriers preventing achievement of those targets.
The commission shall ensure that there are sufficient moneys available to electrical corporations to meet the efficiency targets established pursuant to subdivision (a). This subdivision shall not be construed to authorize the commission to impose or increase any tax.
The commission, in consultation with the Energy Commission, shall identify all potentially achievable cost-effective natural gas efficiency savings and establish efficiency targets for the gas corporation to achieve, consistent with the targets established pursuant to subdivision (c) of Section 25310 of the Public Resources Code.
A gas corporation shall first meet its unmet resource needs through all available natural gas efficiency and demand reduction resources that are cost effective, reliable, and feasible.
By July 1, 2018, and every four years thereafter, each gas corporation shall report on its progress toward achieving the targets established pursuant to subdivision (a).
Notwithstanding subdivision (c) of Section 25310 of the Public Resources Code, if the commission concludes in its review pursuant to paragraph (1) of subdivision (b) of Section 454.55 that the targets established for gas corporations to achieve pursuant to subdivision (a) are not cost effective, feasible, or pose potential adverse impacts to public health and safety, the commission shall revise the targets to the level that maximizes the amount of energy efficiency savings and demand reduction and shall modify, revise, or update its policies as needed to address barriers preventing achievement of those targets.
The commission shall ensure that there are sufficient moneys available to gas corporations to meet the efficiency targets established pursuant to subdivision (a). This subdivision shall not be construed to authorize the commission to impose or increase any tax.
This section shall be known, and may be cited, as the Accelerating Renewable Energy Delivery Act.
The Legislature finds and declares all of the following:
The commission, the Energy Commission, and the State Air Resources Board have jointly estimated that the state’s installed electric generation may need a threefold increase in capacity to meet state carbon-free electricity policy targets.
Record-setting renewable energy generation build rates are needed to meet the goals of the California Renewables Portfolio Standard Program and the Senate Bill 100 (Chapter 312 of the Statutes of 2018) target of supplying 100 percent of retail sales of electricity from renewable energy resources and zero-carbon resources. However, these build rates are not achievable without additional electrical transmission lines and facilities connecting new resources to consumers in the state’s load centers.
In recent years, California has seen problems in delivering renewable energy resources and zero-carbon resources to customers, including problems caused by constraints on the transmission system. First, there are generation pockets where the total potential output from renewable energy generation exceeds the capacity of the transmission system to export that energy. Second, there are load pockets where there is insufficient transmission capacity to import the renewable energy resources and zero-carbon resources that are available. Both types of constraints should be promptly fixed so that all available renewable energy resources and zero-carbon resources can be delivered to customers.
Reducing the use of nonpreferred resources in disadvantaged communities has been a priority for those communities, and they would benefit from increased access to electricity from new renewable energy resources and zero-carbon resources delivered to serve in-city loads.
New transmission facilities have many steps that must be accomplished before they are online and delivering electricity. Major new transmission lines can take more than a decade from initial planning to operation.
New transmission facilities should be planned proactively to support delivery to load centers from expected locations for future renewable energy resource and zero-carbon resource development, where those locations are identified in the integrated resource planning process pursuant to Sections 454.52 and 9621 or as part of longer range planning processes pursuant to Section 454.53.
New transmission facilities should be designed to minimize the risk of transmission-triggered wildfires.
New transmission facilities should be designed to facilitate renewable energy transmission across California to better manage the variability of electrical supply.
The Independent System Operator has issued a 20-Year Transmission Outlook that identifies substantial additional transmission projects needed to integrate renewable energy resources and storage for retail suppliers within the Independent System Operator balancing authority. Given the scale of this challenge, there is an urgent need to prioritize and accelerate the substantial effort needed to build transmission projects with long development times.
Recognizing that the Independent System Operator’s Federal Energy Regulatory Commission-approved tariff requires the Independent System Operator to plan and approve new transmission facilities needed to achieve the state’s goals, it is the intent of the Legislature that the Independent System Operator shall take notice of the state policies expressed in this section.
In support of the state’s policy to supply increasing amounts of electricity from renewable energy resources and zero-carbon resources pursuant to Article 16 (commencing with Section 399.11) and Section 454.53, beginning as soon as possible and not later than March 31, 2024, the commission, in consultation with the Energy Commission, shall provide transmission-focused guidance to the Independent System Operator about resource portfolios of expected future renewable energy resources and zero-carbon resources. The guidance shall include the allocation of those resources by region based on technical feasibility and commercial interest in each region to allow the Independent System Operator to identify and approve transmission facilities needed to interconnect resources and reliably serve the needs of load centers.
In providing the guidance described in subdivision (d), the commission and the Energy Commission shall provide projections each year, including from the integrated energy policy report prepared pursuant to Section 25302 of the Public Resources Code and the load-serving entities’ integrated resource plans prepared pursuant to Section 454.52, to support planning and approvals by the Independent System Operator in its annual transmission planning process, including by doing all of the following:
Providing projections of resource portfolios and electricity demand by region for at least 15 years into the future to ensure adequate lead time for the Independent System Operator to analyze and approve transmission development, and for the permitting and construction of the approved facilities, to meet the projections.
Providing load growth projections, including projected growth from building and transportation electrification, that are consistent with achieving the economywide greenhouse gas emissions reductions required pursuant to Division 25.5 (commencing with Section 38500) of the Health and Safety Code.
Providing resource projections that, combined with transmission capacity expansions, are expected to substantially reduce, no later than 2035, the need to rely on nonpreferred resources in local capacity areas.
The resource projections in subparagraph (A) shall include consideration of cost-effective and feasible alternatives to transmission capacity expansions, including the use of energy storage resources, renewable energy resources, or zero-carbon resources that are located within the local capacity areas.
Providing projections for offshore wind generation as identified by the SB 100 Joint Agency Report of the commission, the Energy Commission, and the State Air Resources Board, and informed by the strategic plan developed pursuant to Section 25991 of the Public Resources Code, to allow the Independent System Operator to identify and approve transmission facilities needed from offshore wind resource areas that would be sufficient to make offshore wind resources fully deliverable to load centers.
Providing projections for increases in imports of electricity into the state that reflect the expected development of renewable energy resources and zero-carbon resources in other parts of the Western Interconnection for the purpose of delivering clean energy to California balancing authorities.
On or before January 15, 2023, the commission shall request the Independent System Operator to do both of the following:
Identify, based as much as possible on studies completed before January 1, 2023, by the Independent System Operator and projections provided before January 1, 2023, by the commission and the Energy Commission, the highest priority transmission facilities that are needed to allow for increased transmission capacity into local capacity areas to deliver renewable energy resources or zero-carbon resources that are expected to be developed by 2035 into those areas.
Consider whether to approve transmission projects identified pursuant to paragraph (1) as part of its 2022–23 transmission planning process.
It is the policy of the state that new transmission facilities be built on a timely basis and in anticipation of new electrical generation that will be built to meet the state’s renewable energy resource and zero-carbon resource targets, with interim targets for transmission capacity additions that demonstrate adequate progress toward meeting these long-term transmission needs. The commission shall request that the Independent System Operator implement this policy by approving transmission projects needed based on a longer planning period supported by the guidance provided pursuant to subdivisions (d) and (e). The projects should be approved in time to be online when needed, considering permitting and construction lead times.
It is the policy of the state that planning for new transmission facilities considers the following goals:
Minimizing the risk of wildfire.
Increasing systemwide reliability and cost efficiency, including through the sharing of diverse electrical generation resources within California and with other parts of the Western Interconnection.
Eliminating transmission constraints that prevent electrical generation resources from delivering to the wider grid and that prevent importing energy into load pockets.
For purposes of this section, the following definitions apply:
The Legislature finds and declares all of the following:
California must dramatically increase the capacity of its electrical transmission and distribution systems to meet the goals of Section 454.53 and to decarbonize its economy.
The increase in transmission and distribution capacity must be done rapidly and cost effectively.
California transmission utilities and the Independent System Operator can jointly explore opportunities to advance technologies that may quickly and cost effectively increase transmission capacity.
Reconductoring existing transmission lines with advanced conductors and installing grid-enhancing technologies, such as advanced power flow control systems, dynamic line rating systems, and topology optimization software, can quickly and cost effectively increase transmission capacity.
The benefits of these technologies include lower electricity rates, less wildfire risk, increased reliability, less transmission line congestion, less curtailment of renewable generation resources, and increased capacity to interconnect new renewable generation, storage, and other zero-carbon resources.
Grid-enhancing technologies may expand and accelerate transmission capacity at a lower cost as compared to traditional transmission technologies.
Reconductoring existing transmission lines with advanced conductors in existing rights-of-way can be accomplished at a fraction of the cost of building new transmission lines and are therefore often quite cost effective.
Grid-enhancing technologies can be deployed within months and reconductoring with advanced conductors can be accomplished within one or two years. Other types of transmission capacity increases can take many years.
The current transmission planning process assesses the value of transmission investments based strictly on the needs of a single assumed planning scenario of specific resources and geographies over a 10-year planning horizon, and does not appropriately incorporate the value that increased transmission capacity can provide in reducing risks surrounding major technology and permitting uncertainties, expanding optionality for load-serving entities, and delivering benefits over a longer time horizon.
For purposes of this section, the following definitions apply:
“Grid-enhancing technologies” means hardware and software that increases the capacity of electrical lines and improves the efficiency, reliability, and safety of the grid. Grid-enhancing technologies include, but are not limited to, dynamic line rating systems, advanced power flow control systems, and topology optimization software.
“Reconductored with advanced conductors” means replacing the existing electric conductor with a conductor that has a direct current electrical resistance at least 10 percent lower than existing conductors of a similar diameter on the system and may include rebuilding support structures or other associated facilities.
“Transmission utility” means an electrical corporation that is a participating transmission owner that has turned over operation of its transmission system to the Independent System Operator.
Increase transmission capacity.
Reduce transmission system congestion.
Reduce curtailment of renewable and zero-carbon resources.
Increase reliability.
Reduce the risk of igniting wildfire, by means of investments that are consistent with the transmission utility’s approved wildfire mitigation plan.
Increase capacity to connect new renewable energy and zero-carbon resources.
Increase flexibility to reduce risks surrounding technology and permitting uncertainties in statewide electrical system planning and improve optionality for load-serving entities.
Increase the ability to quickly energize new customers or serve increased customer load.
Increase flexibility to reduce risks surrounding technology and permitting uncertainties and improve optionality.
Upon submitting the study to the Independent System Operator pursuant to subdivision (c) or (d) and except as provided in paragraph (2), each transmission utility shall make the study publicly available.
Information in the study that is determined by the Independent System Operator, in consultation with the transmission utilities, to be necessary to protect the security of the electrical transmission system shall be withheld from public disclosure.
Each electrical corporation operating a distribution system shall consider grid-enhancing technologies and reconductoring with advanced conductors as part of its annual distribution planning process.
This section does not affect the right of a transmission utility to implement self-approved projects.
This section does not affect any project previously approved by the Independent System Operator.
This section applies to the obligations on a state agency, except the State Water Resources Development System commonly known as the State Water Project, imposed pursuant to subdivision (a) of Section 454.53.
Each state agency shall ensure that zero-carbon resources and eligible renewable energy resources supply 100 percent of electricity procured on its behalf by December 31, 2035.
A state agency may satisfy the requirement in subdivision (b) by doing one or more of the following:
Installing zero-carbon resources or eligible renewable energy resources behind the customer meter on state-owned or state-leased buildings to serve the state agency’s onsite load.
Procuring zero-carbon resources or eligible renewable energy resources through the local publicly owned electric utility or load-serving entity, as defined in Section 380, providing retail service to the state agency, subject to any credit or collateral requirements or other applicable requirements imposed by the local publicly owned electric utility or load-serving entity, as defined in Section 380, as a condition for procurement on behalf of a customer.
Participating in a voluntary shared renewable or green pricing program offered by a local publicly owned electric utility or load-serving entity, as defined in Section 380, if the resources serving the state agency satisfy the requirements of subdivision (d).
New procurement commitments made on behalf of a state agency by its retail seller or local publicly owned electric utility after June 1, 2022, for zero-carbon resources or eligible renewable energy resources to serve the state agency pursuant to subdivision (c) shall satisfy all of the following criteria:
The retail seller or local publicly owned electric utility shall require its contractors to use a multicraft project labor agreement, as defined in paragraph (1) of subdivision (b) of Section 2500 of the Public Contract Code, for construction of the zero-carbon resource or eligible renewable energy resource. The project labor agreement shall conform to the industry standard agreements recently used for other similar private projects, including side letters for high-voltage transmission and related work.
Any renewable energy credits or environmental attributes associated with incremental procurement pursuant to this section shall be retired on behalf of the state agency customer and shall not be further sold, transferred, or otherwise monetized for any purpose.
Zero-carbon resource or eligible renewable energy resource procurement commitments made on behalf of a state agency shall give preference to resource options expected to yield maximum long-term employment, stimulate new economic activity, generate local and state tax revenues, and assist with the development of new industries.
A contract entered into pursuant to Section 454.5 by an electrical corporation for the electricity generated by a replacement or repowering project that meets the criteria specified in subdivision (b) shall be recoverable in rates, taking into account any collateral requirements and debt equivalence associated with the contract, in a manner determined by the commission to provide the best value to ratepayers.
To be eligible for rate treatment in accordance with subdivision (a), a contract shall be for a project which meets all of the following criteria:
The project is a replacement or repowering of an existing generation unit of a thermal powerplant.
The project complies with all applicable requirements of federal, state, and local laws.
The project will not require significant additional rights-of-way for electrical or fuel-related transmission facilities.
The project will result in significant and substantial increases in the efficiency of the production of electricity.
The Independent System Operator or local system operator certifies that the project is needed for local area reliability.
The project provides electricity to consumers of this state at the cost of generating that electricity, including a reasonable return on the investment and the costs of financing the project.
The commission shall, to the extent permitted by federal law and consistent with Section 2771, provide cogeneration technology projects with the highest possible priority for the purchase of natural gas.
In any decision establishing rates for an electrical or gas corporation reflecting the reasonable and prudent costs of the new construction of any addition to or extension of the corporation’s plant, when the commission has found and determined that the addition or extension is used and useful, the commission shall consider a method for the recovery of these costs which would be constant in real economic terms over the useful life of the facilities, so that ratepayers in a given year will not pay for the benefits received in other years.
The commission shall authorize public utilities to establish catastrophic event memorandum accounts and to record in those accounts the costs of the following:
Restoring utility services to customers.
Repairing, replacing, or restoring damaged utility facilities.
Complying with governmental agency orders in connection with events declared disasters by competent state or federal authorities.
The costs, including capital costs, recorded in the accounts set forth in subdivision (a) shall be recoverable in rates following a request by the affected utility, a commission finding of their reasonableness, and approval by the commission. The commission shall hold expedited proceedings in response to utility applications to recover costs associated with catastrophic events.
Whenever any schedule stating an individual or joint rate, classification, contract, practice, or rule, not increasing or resulting in an increase in any rate, is filed with the commission, it may, either upon complaint or upon its own initiative, at once and if it so orders without answer or other formal pleadings by the interested public utility or utilities, but upon reasonable notice, enter upon a hearing concerning the propriety of the rate, classification, contract, practice, or rule. Pending the hearing and the decision thereon the rate, classification, contract, practice, or rule shall not go into effect. Except as provided in Section 455.1, the period of suspension of the rate, classification, contract, practice, or rule shall not extend beyond 120 days beyond the time when it would otherwise go into effect unless the commission extends the period of suspension for a further period not exceeding six months. On the hearing the commission shall establish the rates, classifications, contracts, practices, or rules proposed, in whole or in part, or others in lieu thereof, which it finds to be just and reasonable.
All rates, classifications, contracts, practices, or rules not so suspended shall become effective on the expiration of 30 days from the time of filing thereof with the commission or a lesser time as the commission may grant, subject to the power of the commission, after a hearing had on its own motion or upon complaint, to alter or modify them.
Whenever a water corporation files with the commission, pursuant to an advice letter submitted in accordance with commission procedures for this means of submission, a schedule stating rates, classifications, contracts, practices, or rules for the service of recycled water, the policies and standards for which are provided for in Article 7 (commencing with Section 13550) of Chapter 7 of Division 7 of the Water Code, the commission shall observe the following procedures:
Unless the commission determines, pursuant to subdivision (b), that the schedule filed by a water corporation for the service of recycled water is not justified or, pursuant to subdivision (d), any other party protests in writing the filing of the schedule, the schedule shall become effective upon the expiration of 40 days from the time of filing thereof.
Notwithstanding the filing of notice of changes or amendments as provided in subdivision (c) or a protest as provided in subdivision (d), the schedule as filed shall become effective on an interim basis upon the expiration of 30 days from the time of filing thereof, subject to refund of any amount of the rate subsequently found by the commission to be in excess of a just and reasonable rate.
If, upon its own initiative, the commission, acting through the staff organization with responsibility for reviewing advice letter filings, determines that the schedule filed by a water corporation for the service of recycled water is not justified, it shall notify the water corporation of the determination in writing within 40 days from the time of filing of the schedule and shall state in the notice all changes or amendments to the schedule that are required to make it just and reasonable. Upon the refiling by the water corporation within 10 days of the receipt of the notice of a revised schedule incorporating all changes and amendments specified by the commission, the revised schedule shall become effective on an interim basis subject to refund upon the expiration of five days from the time of the refiling thereof, and shall become final upon formal commission action approving the schedule, as revised.
If any other party, including the commission organization or division created pursuant to Section 309.5, protests in writing the schedule filed by a water corporation for the service of recycled water, the commission shall set the matter for a hearing on the protest to be held within a reasonable time from the time that the party files its written protest with the commission.
Subdivision (d) of Section 311 shall govern the timing of actions by the commission after the close of the record in any proceeding pursuant to subdivision (d) of this section.
The commission shall issue its final decision on a general rate case application of a water corporation with greater than 10,000 service connections in a manner that ensures that the commission’s decision becomes effective on the first day of the first test year in the general rate increase application.
If the commission’s decision is not effective in accordance with subdivision (a), the applicant may file a tariff implementing interim rates that may be increased by an amount equal to the rate of inflation as compared to existing rates. The interim rates shall be effective on the first day of the first test year in the general rate case application. These interim rates shall be subject to refund and shall be adjusted upward or downward back to the interim rate effective date, consistent with the final rates adopted by the commission. The commission may authorize a lesser increase in interim rates if the commission finds the rates to be in the public interest. If the presiding officer in the case determines that the commission’s decision cannot become effective on the first day of the first test year due to actions by the water corporation, the presiding officer or commission may require a different effective date for the interim rates or final rates.
The commission shall establish a schedule to require every water corporation subject to the rate case plan for water corporations to file an application pursuant to the plan every three years. The plan shall include a provision to allow the filing requirement to be waived upon mutual agreement of the commission and the water corporation.
The requirements of subdivisions (a) and (b) may be waived at any time by mutual consent of the executive director of the commission and the water corporation.
Notwithstanding any other provision of law, including, but not limited to Section 454, no later than January 1, 1998, the commission shall adopt rules and regulations that substantially revise the manner in which oil pipeline corporations may change and use rates.
The revised rules and regulations shall adhere to the following criteria:
Pipeline corporations shall be required to give the commission and all shippers no less than 30 days’ notice of rate changes.
After the 30-day notice of rate change, pipeline corporations shall be permitted to change rates and use those rates prior to commission approval.
The commission shall have the authority to suspend a rate change and use of the changed rate for a period of time not to exceed 30 days from expiration of the 30-day notice period specified in paragraph (1).
Pipeline corporations shall refund, with interest, any portion of the rate change that is subsequently disallowed by the commission to all shippers within 30 days of the commission’s decision becoming final. Interest shall accrue from the date the new rate is first charged.
Any increase in the shipping rate charged by an oil pipeline corporation prior to commission approval shall not exceed 10 percent per 12-month period. The commission shall determine the appropriateness of allowing retroactive charge and collection of subsequently approved rate increases above 10 percent.
It is the intent of the Legislature that oil pipeline corporations be permitted to use new rates after the period of the suspension of a rate change, if any, by the commission pursuant to paragraph (3) of subdivision (b) prior to commission approval, provided any disallowed portion of the new rate is fully refunded with interest.
In establishing rates for any electrical, gas, heat, or water corporation, the commission may eliminate consideration of the value of any portion of any electric, gas, heat, or water generation or production facility which, after having been placed in service, remains out of service for nine or more consecutive months, and may disallow any expenses related to that facility. Upon eliminating consideration of any portion of a facility or disallowing any expenses related thereto under this section, the commission shall reduce the rates of the corporation accordingly and shall, for accounting purposes, record the value of that portion of the facility in a deferred debit account and shall treat this amount similar to the treatment of the allowance for funds used during construction. When that portion of the facility is returned to useful service, as provided in subdivision (c), the corporation may apply to the commission for the inclusion of its value and expenses related to its operation for purposes of the establishment of the corporation’s rates.
Every electrical, gas, heat, and water corporation shall periodically, as required by the commission, report to the commission on the status of any portion of any electric, gas, heat, or water generation or production facility which is out of service and shall immediately notify the commission when any portion of the facility has been out of service for nine consecutive months.
Within 45 days of receiving the notification specified in subdivision (b), the commission shall institute an investigation to determine whether to reduce the rates of the corporation to reflect the portion of the electric, gas, heat, or water generation or production facility which is out of service. For purposes of this subdivision, out-of-service periods shall not include planned outages of predetermined duration scheduled in advance.
The commission’s order shall require that rates associated with that facility are subject to refund from the date the order instituting the investigation was issued. The commission shall consolidate the hearing on the investigation with the next general rate proceeding instituted for the corporation.
Upon being informed by the corporation that any portion of its electric, gas, heat, or water generation or production facility which was eliminated from consideration by the commission in establishing rates for being out of service for nine or more consecutive months pursuant to subdivision (a) or (b), has been restored to service and has achieved at least 100 continuous hours of operation, the commission may again consider that portion of the facility for purposes of establishing rates, and may adjust the corporation’s rates accordingly without a hearing, except that a hearing is required on whether to include, for purposes of establishing rates, any additional plant value added.
Nothing in this section prohibits the commission from reviewing the effects of any electric, gas, heat, or water generation or production facility which has been out of service for less than nine consecutive months or planned outages of predetermined duration scheduled in advance.
For purposes of this section, an electric, gas, heat, or water generation or production facility includes only such a facility that the commission determines to be a major facility of the corporation, and does not include any facility determined by the commission to constitute a plant held for future use.
For purposes of this section, the following definitions apply:
“Large electrical corporation” has the same meaning as defined in Section 3280.
“Large gas corporation” means a gas corporation with 250,000 or more customer accounts within the state.
By January 1, 2026, and each year thereafter, each large electrical corporation shall publish on its internet website, and provide to the commission, a visual representation of the cost categories included in residential electric rates for the succeeding calendar year that includes all of the following cost categories:
Costs associated with electrical distribution grid infrastructure, not including costs associated specifically with wildfire mitigation.
Costs associated with wildfire mitigation activities pursuant to Chapter 6 (commencing with Section 8385) of Division 4.1.
Costs associated with the electrical transmission infrastructure, separating transmission costs in the jurisdiction of the commission from those in the jurisdiction of the Federal Energy Regulatory Commission.
Costs due to energization, including pursuant to Article 14.5 (commencing with Section 931) of Chapter 4.
Costs due to catastrophic events and emergencies.
Costs due to commodity prices, including natural gas.
Costs due to insurance, including self-insurance.
Costs due to metering and billing.
Costs due to taxes.
Costs due to unrecovered arrearages.
Any other cost categories, as determined by the commission.
On or before January 1, 2026, and each year thereafter, each large gas corporation shall publish on its internet website, and provide to the commission, a visual representation of the cost categories included in residential gas rates for the succeeding calendar year that includes all of the following cost categories:
Nothing in this part shall be construed to prohibit any public utility from profiting, to the extent permitted by the commission, from any economies, efficiencies, or improvements which it may make, and from distributing by way of dividends, or otherwise disposing of, such profits. The commission may make or permit such arrangement with any public utility as it deems wise for the purpose of encouraging economies, efficiencies, or improvements and securing the public utility making them such portion of the profits thereof as the commission determines.
No common carrier, or any officer or agent thereof, or any person acting for or employed by it, shall, by means of known false billing, classification, weight, weighing, or report of weight, or by any other device or means assist, suffer, or permit any corporation or person to obtain transportation for any person or property between points within this state at less than the rates and fares then established and in force as shown by the schedules filed and in effect at the time.
No person, corporation, or any officer, agent, or employee of a corporation shall, by means of false billing, false or incorrect classification, false weight or weighing, false representation as to contents or substance of a package, or false report or statement of weight, or by any other device or means, whether with or without the consent or connivance of a common carrier or any of its officers, agents, or employees, seek to obtain or obtain such transportation for such property at less than the rates then established and in force therefor.
Subdivision (a) is not applicable to network railroad transportation.
No person or corporation, or any officer, agent, or employee of a corporation, shall knowingly, directly or indirectly, by any false statement or representation as to cost or value, or the nature or extent of an injury, or by the use of any false billing, bill of lading, receipt, voucher, roll, account, claim, certificate, affidavit, or deposition, or upon any false, fictitious, or fraudulent statement or entry, obtain or attempt to obtain any allowance, rebate, or payment for damage, in connection with or growing out of the transportation of persons or property, or an agreement to transport such persons or property, whether with or without the consent or connivance of a common carrier or any of its officers, agents, or employees. No common carrier, or any of its officers, agents, or employees, shall knowingly pay or offer to pay any such allowance, rebate, or claim for damage.
Subdivision (a) is not applicable to network railroad transportation.
The commission shall prohibit any passenger stage corporation from charging any fare to, or imposing any other charge on, any physically disabled or handicapped passenger which is more than the fare or charge imposed on a passenger who is not physically disabled or handicapped for the same transportation or service, and shall approve no schedule of fares or charges which is discriminatory under this section.
Any special provision made by a passenger stage corporation for assisting a physically disabled or handicapped person in using its transportation service is, for purposes of subdivision (a), a part of the same transportation or service offered to passengers who are not physically disabled or handicapped, and is not a separate service for which an additional charge may be made. Nothing in this section, however, requires a passenger stage corporation to furnish any equipment or assistance for a physically disabled or handicapped person different from or in addition to that which may be required under any other law.
Beginning July 1, 1990, and continuing thereafter, every passenger stage corporation shall file with the commission one of the following:
A certificate of workers’ compensation coverage for its employees issued by an admitted insurer.
A certification of consent to self-insure issued by the Director of Industrial Relations, and the identity of the administrator of the carrier’s workers’ compensation self-insurance plan.
A statement under penalty of perjury, stating that, in its operations as a passenger stage corporation, it does not employ any person in any manner so as to become subject to the workers’ compensation laws of this state.
The workers’ compensation certified to under paragraph (1) of subdivision (a) shall be effective until canceled. Cancellation shall require 30 days’ advance notice.
If, after filing the statement described in paragraph (3) of subdivision (a), the corporation becomes subject to the workers’ compensation laws of this state, the corporation shall promptly notify the commission that the corporation is withdrawing its statement under paragraph (3) of subdivision (a), and shall simultaneously file the certificate described in either paragraph (1) or (2) of subdivision (a).
The commission may adopt rules and regulations that it determines to be necessary to carry out this section.
For purposes of establishing rates for a telephone or telegraph corporation, the commission shall include all revenues and expenses of the corporation from the installation and maintenance of that simple inside wiring which is subject to the order of the Federal Communications Commission deregulating that wiring (CC Docket No. 79-105, FCC 86-63; 51 F.R. 8498, March 12, 1986).
No discrimination in charges or facilities for transportation shall be made by any railroad or other transportation company between places or persons, or in the facilities for the transportation of the same classes of freight or passengers within this state. It shall be unlawful for any railroad or other transportation company to charge or receive any greater compensation in the aggregate for the transportation of passengers or of like kind of property for a shorter than for a longer distance over the same line or route in the same direction, the shorter being included within the longer distance, or to charge any greater compensation as a through rate than the aggregate of the intermediate rates.
Upon application to the commission company may be authorized by the commission to charge less for longer than for shorter distances for the transportation of persons or property and the commission may from time to time prescribe the extent to which such company may be relieved from the prohibition to charge less for the longer than for the shorter haul. The commission may authorize the issuance of excursion and commutation tickets at special rates.
Nothing contained in this section shall be construed to prevent the commission from ordering and compelling any railroad or other transportation company to make reparation to any shipper on account of the rates charged to such shipper being excessive or discriminatory, provided no discrimination will result from such reparation.
Subdivision (a) is not applicable to network railroad transportation.
Every street or interurban railroad corporation shall upon such terms as the commission finds to be just and reasonable furnish to its passengers transfers entitling them to one continuous trip in the same general direction over and upon the portions of its lines within the same city or city and county not reached by the originating car.
For purposes of establishing rates for any electrical or gas corporation, the commission shall disallow expenses reflecting the direct or indirect costs resulting from any unreasonable error or omission relating to the planning, construction, or operation of any portion of the corporation’s plant which cost, or is estimated to have cost, more than fifty million dollars ($50,000,000), including any expenses resulting from delays caused by any unreasonable error or omission. Nothing in this section prohibits a finding by the commission of other unreasonable or imprudent expenses. This subdivision is a clarification of the existing authority of the commission, is not intended to limit or restrict any power or authority of the commission conferred by any other provision of law, and applies to all matters pending before the commission. This section does not prohibit the commission from establishing rates for an electrical or gas corporation on a basis other than an allowed rate of return on undepreciated capital costs.
Whenever an electrical or gas corporation fails to prepare or maintain records sufficient to enable the commission to completely evaluate any relevant or potentially relevant issue related to the reasonableness and prudence of any expense relating to the planning, construction, or operation of the corporation’s plant, the commission shall disallow that expense for purposes of establishing rates for the corporation. This subdivision does not apply where the commission determines that a reasonable person could not have anticipated either the relevance or potential relevance, to an evaluation of costs incurred on the project, of preparing or maintaining the records or the extent of recordkeeping required to adequately evaluate those costs.
For purposes of this section:
“Planning” includes, but is not limited to, activities related to the initial and subsequent assessments of the need for a plant construction project; the selection of contractors and the negotiation of contract provisions; certification; project organization; and site selection, including the investigation and interpretation of environmental factors such as seismic conditions and other external factors affecting the construction, operation, and safety of the plant.
“Construction” includes, but is not limited to, activities related to engineering such as the development and use of specifications, drawings, and procedures; the preparation and use of construction plans, including blueprints; procurement activities; repairs, replacement, redesign, or repositioning of equipment and facilities; startup activities; and quality assurance and quality control activities.
“Operation” includes, but is not limited to, activities related to decisions affecting the timing and nature of the use of the plant; dispatch and control activities and decisions; and plant operation, fuel loading, and maintenance.
“Error” includes, but is not limited to, any action or direction which causes an avoidable (i) increase in the time required to bring the plant to full commercial operation, (ii) change in the number or types of personnel or firms required to bring the plant to full commercial operation, (iii) increase in the number of worker hours required to complete any portion of the plant construction project, or (iv) change of equipment, configuration, design, schedule, or program.
“Omission” includes, but is not limited to, any failure to act or to provide direction which causes an avoidable (i) increase in the time required to bring the plant to full commercial operation, (ii) change in the number or types of personnel or firms required to bring the plant to full commercial operation, (iii) increase in the number of worker hours required to complete any portion of the plant construction project, or (iv) change of equipment, configuration, design, schedule, or program.
Section 463 does not require the commission to undertake a reasonableness review of recorded costs to determine the reasonableness of the costs of each item of any electrical or gas corporation’s plant which costs, or is estimated to have cost, more than fifty million dollars ($50,000,000) where the commission either has established a maximum reasonable cost pursuant to Section 1005.5 or has adopted an estimate of the reasonable costs in any proceeding.
The establishment of the maximum costs or adoption of an estimated cost does not limit or restrict the discretion of the commission in considering the reasonableness of plant-related costs in subsequent proceedings.
This section shall become operative January 1, 1989.
Reasonable expenditures by transmission owners that are electrical corporations to plan, design, and engineer reconfiguration, replacement, or expansion of transmission facilities are in the public interest and are deemed prudent if made for the purpose of facilitating competition in electric generation markets, ensuring open access and comparable service, or maintaining or enhancing reliability, whether or not these expenditures are for transmission facilities that become operational.
The commission and the Electricity Oversight Board shall jointly facilitate the efforts of the state’s transmission owning electrical corporations to obtain authorization from the Federal Energy Regulatory Commission to recover reasonable expenditures made for the purposes stated in subdivision (a).
Nothing in this section alters or affects the recovery of the reasonable costs of other electric facilities in rates pursuant to the commission’s existing ratemaking authority under this code or pursuant to the Federal Power Act (41 Stat. 1063; 16 U.S.C. Secs. 791a, et seq.). The commission may periodically review and adjust depreciation schedules and rates authorized for an electric plant that is under the jurisdiction of the commission and owned by an electrical corporation and periodically review and adjust depreciation schedules and rates authorized for a gas plant that is under the jurisdiction of the commission and owned by a gas corporation, consistent with this code.
Except as provided in subdivision (c), whenever any labor of a custodial or janitorial nature is not performed by the employees of a public utility, such labor shall be let out under contract to the lowest responsible bidder with the provision that prevailing wages be a condition of any such contract. For the purposes of this section, “prevailing wages” shall be deemed to include employer payments for health and welfare, pension, holidays, sick leave, vacation, apprenticeship or other training programs.
A public utility shall implement the provisions of subdivision (a) by requiring the entity with which it contracts to pay its custodial or janitorial employees the prevailing wage. The public utility awarding the contract shall cause to be inserted in the contract a stipulation that the failure to pay prevailing wages shall be cause for the termination of the contract.
Nothing in this section shall prevent a public utility from employing a custodial or janitorial service for a period of 90 days or less without a contract meeting the requirements of subdivision (a) of this section.
The Director of the Department of Industrial Relations shall determine the prevailing wage for custodial or janitorial employees in accordance with the standards set forth in Section 1773 of the Labor Code.
Pursuant to Section 465, the contractor to whom the contract is awarded and any subcontractor under him shall pay not less than the specified prevailing wage to all workmen performing custodial or janitorial labor in the excecution of the contract.
Each contractor and subcontractor shall keep an accurate payroll record, showing the name, address, social security number, work classification, straight time and overtime hours worked each day and week, and the actual per diem wages paid to each janitorial and custodial worker employed by him in connection with the contract. The contractor’s and subcontractor’s payroll records shall be available for inspection at all reasonable hours, and a copy shall be made available upon request to the employee, or his authorized representative, and the Division of Labor Standards Enforcement. After a complaint has been filed with the Division of Labor Standards Enforcement alleging that the contractor or the subcontractor has paid less than the prevailing wage, the contractor or subcontractor shall upon receipt of a written notice from the Division of Labor Standards Enforcement within 10 days file with the public utility and the Division of Labor Standards Enforcement a certified copy of the payroll records.
The Division of Labor Standards Enforcement in the Department of Industrial Relations shall enforce Section 466 in the same manner as provided for by Chapter 4 (commencing with Section 79) of Division 1 of the Labor Code.
For purposes of this section, “expense incurred by a public utility in assisting or deterring union organizing” means costs incurred in communicating with employees, or employees of the public utility’s contractors, in an effort to persuade them to join or support, or to not join or support, a labor organization.
Any expense incurred by a public utility in assisting or deterring union organizing shall not be recoverable either directly or indirectly in the public utility’s rates and shall be borne exclusively by the shareholders of the public utility.
ARTICLE 2. Tariff Schedules [486. - 495.7.]
Every common carrier shall file with the commission and shall print and keep open to the public inspection schedules showing the rates, fares, charges, and classifications for the transportation between termini within this state of persons and property from each point upon its route to all other points thereon; and from each point upon its route to all points upon every other route leased, operated, or controlled by it; and from each point on its route or upon any route leased, operated, or controlled by it to all points upon the route of any other common carrier, whenever a through route and a joint rate has been established or ordered between any two such points. If no joint rate over a through route has been established, the schedules of the several carriers in such through route shall show the separately established rates, fares, charges, and classifications applicable to the through transportation.
Subdivision (a) is not applicable to network railroad transportation.
The schedules shall plainly state the places between which property and persons will be carried, and the classification of passengers or property in force, and shall state separately all terminal charges, storage charges, icing charges, and all other charges which the commission may require to be stated, all privileges or facilities granted or allowed, and all rules which may in any wise change, affect, or determine any part, or the aggregate of, such rates, fares, charges, and classifications, or the value of the service rendered to the passenger, shipper, or consignee. Schedules shall be plainly printed, and copies thereof shall be kept by every such carrier at such stations or offices of the carrier and subject to such conditions as the commission may determine and prescribe by order or rule.
Subject to such rules as the commission may prescribe, the schedules of carriers shall be produced and made available for inspection upon the demand of any person. The form of every such schedule shall be prescribed by the commission and shall conform, in the case of any common carrier subject to federal regulation as nearly as possible to the form of schedules prescribed by the federal Surface Transportation Board.
Subdivision (a) is not applicable to network railroad transportation.
The commission shall, by rule or order, require every public utility other than a common carrier to file with the commission within the time and in the form as the commission designates, and to print and keep open to public inspection, schedules showing all rates, tolls, rentals, charges, and classifications collected or enforced, or to be collected or enforced, together with all rules, contracts, privileges, and facilities which in any manner affect or relate to rates, tolls, rentals, classifications, or service. Nothing in this section shall prevent the commission from approving or fixing rates, tolls, rentals, or charges, from time to time, in excess of or less than those shown by the schedules.
The commission shall, by rule or order, require every telephone corporation operating within a service area, on first contact by a prospective subscriber and in subsequent contacts by the subscriber for the purpose of changing service, to fully inform the subscriber of the basic services available to the class of subscribers to which the subscriber belongs. For eligible residential subscribers, these services shall include universal lifeline telephone service. The subscriber shall be presented with information orally, in print form, or in computer data form, according to the means by which contact is established. If after a hearing, the commission finds that any telephone corporation has not provided prospective subscribers with the information required by this section, the commission may make an appropriate adjustment of the telephone corporation’s rates or impose penalties pursuant to other provisions of law.
The commission may from time to time determine and prescribe by order changes in the form of the schedules referred to in this article as it finds expedient, and may modify the requirements of any of its orders or rules in respect to any matter referred to in this article.
If the rates for any commercial mobile radio service are not subject to regulation by the commission as a result of federal law, then the commission may exempt the service from any tariff-filing requirement.
Unless the commission otherwise orders, no change shall be made by any public utility in any rate or classification, or in any rule or contract relating to or affecting any rate, classification, or service, or in any privilege or facility, except after 30 days’ notice to the commission and to the public. Notice shall be given by filing with the commission and keeping open for public inspection new schedules stating plainly the changes to be made in the schedule or schedules then in force, and the time when the changes will go into effect. The commission, for good cause shown, may allow changes without requiring the 30 days’ notice, by an order specifying the changes that may be made on less than 30 days’ notice, the time when they shall take effect, and the manner in which they shall be filed and published. When any change is proposed in any rate or classification, or in any form of contract or agreement or in any rule or contract relating to or affecting any rate, classification, or service, or in any privilege or facility, attention shall be directed to such change on the schedule filed with the commission, by some character to be designated by the commission, immediately preceding or following the item.
Notwithstanding Section 491, the commission may authorize a passenger stage corporation, upon one day’s notice, to reduce its rates and charges to not less than those of a competing passenger transportation service operating over substantially the same route pursuant to federal operating authority. The commission may attach any conditions it finds reasonable or necessary.
The names of the several public utilities which are parties to any joint tariff, rate, contract, or classification shall be specified in the schedule. Unless otherwise ordered by the commission, a schedule showing such joint tariff, rate, contract, or classification need be filed with the commission by only one of the parties to it, if there is also filed with the commission, in such form as it may require, a concurrence therein by each of the other parties thereto.
No common carrier subject to this part shall engage or participate in the transportation of persons or property, between points within this state, until its schedules of rates, fares, charges, and classifications have been filed and published in accordance with this part.
If any common carrier of property, in contravention of subdivision (a), transports any property for which it does not have schedules of rates, fares, charges, and classifications on file, the commission may establish a just and reasonable charge for the transportation.
This section is not applicable to network railroad transportation.
No common carrier shall charge, demand, collect, or receive a different compensation for the transportation of persons or property, or for any service in connection therewith, than the applicable rates, fares, and charges specified in its schedules filed and in effect at the time, nor shall any such carrier refund or remit in any manner or by any device any portion of the rates, fares, or charges so specified, except upon order of the commission as provided in this part, nor extend to any corporation or person any privilege or facility in the transportation of passengers or property except such as are regularly and uniformly extended to all corporations and persons.
Subdivision (a) is not applicable to network railroad transportation.
Every telegraph and telephone corporation shall print and file with the commission schedules showing all the rates and classifications for the transmission of messages or conversations between all of the following points, unless otherwise exempted, in whole or in part, from the filing requirements of subdivision (a) of Section 489:
Between all points within this state and all points outside the state upon its route.
Between all points within this state and all points outside the state upon every route leased, operated, or controlled by it.
Between all points on its route or upon any route, leased, operated, or controlled by it within this state and all points outside the state upon the route of any other telegraph or telephone corporation, whenever a through route and joint rate have been established between any two of these points.
Any city, county, or city and county that levies a utility user tax on the consumption of telephone services, including, but not limited to, the tax authorized by Section 7284.2 of the Revenue and Taxation Code, shall provide to the commission the rate of the tax, the manner in which the tax is collected, and the frequency with which the tax is collected.
The commission shall establish the periodic frequency at which information required by subdivision (a) shall be submitted to the commission.
The commission shall provide information received pursuant to subdivision (a) to any person or entity upon receiving a request for the information. The commission may charge a fee, at a level that shall not exceed the direct expenses of the commission in preparing and providing the information, to any person or entity that receives the information.
The commission shall not be responsible for the accuracy of the information that it receives from a city, county, or city and county and provides pursuant to this section.
The commission finds that the telephone corporation lacks significant market power in the market for that service for which an exemption from Sections 454, 489, 491, and 495 is being requested. Criteria to determine market power shall include, but not be limited to, the following: company size, market share, and type of service for which an exemption is being requested. The commission shall promulgate rules for determining market power based on these and other appropriate criteria.
The Commission finds that a telephone corporation is offering a service in a given market for which competitive alternatives are available to most consumers, and the commission has determined that sufficient consumer protections exist in the form of rules and enforcement mechanisms to minimize the risk to consumers and competition from unfair competition or anticompetitive behavior in the market for the competitive telecommunications service for which a provider is requesting an exemption from Sections 454, 489, 491, and 495. This paragraph does not apply to monopoly services for which the commission retains exclusive authority to set or change rates.
Before implementing procedures to allow telephone corporations to apply for the exemption of certain telecommunications services from the tariffing requirements of Sections 454, 489, 491, and 495, and no later than September 30, 1996, the commission shall establish consumer protection rules for those exempted services that include, but are not limited to:
Rules to identify and eliminate unacceptable marketing practices including, but not limited to, fraudulent marketing practices.
Rules to assure that aggrieved consumers have speedy, low-cost, and effective avenues available to seek relief in a reasonable time.
Rules to assure consumers that their right to informational privacy for services over which the commission has oversight.
Rules to assure a telephone corporation’s cooperation with the commission investigations of customer complaints.
Nothing in this section shall require that the commission exempt any telecommunications service or telecommunications service provider from the requirements of Sections 454, 489, 491, and 495, nor shall this section limit the authority of the commission to require telephone corporations to provide it with contemporaneous information about the current terms, conditions, and prices under which telecommunications services that are exempted, in whole or in part, from Sections 454, 489, 491, and 495 are being offered to subscribers.
The commission, after notice and hearing if requested, may cancel, revoke, or suspend any exemption granted under subdivision (b) to any telephone corporation that fails to comply with any of the rules established by the commission pursuant to subdivision (c).
The provisions of this section do not apply to commercial mobile services as defined by the Omnibus Budget Reconciliation Act of 1993 (Public Law 103-66).
ARTICLE 3. Free or Reduced Rates [521. - 533.]
As used in this article “employees” includes furloughed, pensioned, and superannuated employees of any common carrier subject to the provisions of this part, persons who have become disabled or infirm in the service of any such carrier, ex-employees traveling for the purpose of entering the service of any such carrier, and the remains of persons dying while in the employment of any such carrier; and “families” includes the families of such persons and the families of persons killed, and the surviving spouses until remarried and minor children during minority of persons who died while in the service of any such carrier.
Except as provided in this article, Sections 40180.5 and 99151 of this code, and Section 26002.5 of the Government Code, no common carrier subject to the provisions of this part shall, directly or indirectly, issue, give, or tender any free ticket, free pass, or free or reduced rate transportation for passengers between points within this state.
When approved by the commission, a common carrier may give free or reduced rate transportation between points within this state to:
Its officers, agents, employees, and members of their families.
Indigent, destitute, and homeless persons, and to such persons when transported by charitable societies or hospitals, and the necessary agents employed in such transportation.
Persons injured in accidents or wrecks, and physicians and nurses attending such persons.
Any common carrier may issue free or reduced rate passenger transportation to the proprietors and employees of newspapers and magazines and the members of their immediate families in exchange for advertising of equal or greater value in that media, subject to reasonable restrictions that the commission may impose.
The San Francisco-San Jose commute rail service may issue free or reduced rate passenger transportation to the proprietors and employees of the broadcast news media in exchange for advertising of equal or greater value in those media, subject to reasonable restrictions that the commission may impose. On or before January 1, 1989, the Department of Transportation shall review and assess the effectiveness and cost of any advertising program effectuated through exchanges made pursuant to this subdivision.
Passenger stage corporations may issue free or reduced rate passenger transportation to any of their commission agents.
All blind residents of California may be granted free transportation on all street cars and may be permitted to travel on all other common carriers within the State for one-half the current fare, and when any blind person is accompanied by a guide, the combined fares for such blind person and his guide may be fixed at not to exceed the current fare for an individual.
Nothing in this part shall prevent the interchange of free or reduced rate transportation for passenger or express matter between common carriers, their officers, agents, employees, attorneys, physicians and surgeons, and members of their families, where such common carriers are subject in whole or in part to the jurisdiction of the commission or of the federal Surface Transportation Board or where such common carriers, though not in whole or in part subject to the jurisdiction of this commission or of the federal Surface Transportation Board are engaged in the business of transporting passengers and freight by water between the United States and foreign countries, and are permitted by federal law to interchange such free transportation with common carriers which are subject to the jurisdiction of the Public Utilities Commission or the federal Surface Transportation Board.
Nothing in this part shall prevent the interchange of free or reduced rate transportation for passengers or express matter between a common carrier and a corporation engaged in the carriage of persons or property by motor vehicle, or the officers, agents, employees, attorneys, physicians and surgeons of such common carrier or corporation and their families when the corporation is engaged in the carriage by motor vehicle of persons or property as a connecting carrier, or in the carriage by motor vehicle of persons or property over a portion of a route between the point of departure or shipment and arrival or delivery, part of which route is covered or traveled by a common carrier, whether the carriage by motor vehicle is an initial, an intermediate, or a final portion of the entire route between the point of departure or shipment and arrival or delivery.
This section does not authorize the interchange of free or reduced rate transportation for express matter which is not for the personal use of the person to or for whom it is granted, or of his family.
Nothing in this part shall prevent any of the following:
The issue of reduced rate transportation by a common carrier to children attending an institution of learning.
The issue of passes or franks by telegraph or telephone corporations to their officers, agents, employees, attorneys, physicians and surgeons, and members of their families, or the exchange of passes or franks between the telegraph and telephone corporations or between the corporations and the common carriers, for their officers, agents, employees, attorneys, physicians and surgeons, and members of their families.
The carrying out of contracts for free or reduced rate passenger transportation previously made, founded upon adequate consideration and lawful when made.
A common carrier from transporting, storing, or handling, free or at reduced rates, the household goods and personal effects of its employees, of persons entering or leaving its service, and of persons killed or dying while in its service.
A common carrier from providing reduced rate transportation to elderly and handicapped persons when required pursuant to an application for federal funds under the Urban Mass Transportation Act of 1964 (49 U.S.C. Sec. 1601 et seq.).
Every common carrier subject to the provisions of this part may transport, free or at reduced rates, as follows:
Persons for the United States, state, county, or municipal governments, or persons or property for charitable or patriotic purposes, or to provide relief in cases of general epidemic, pestilence, or calamity.
Contractors and their employees, material or supplies for use or engaged in carrying out their contracts with such carriers, for construction, operation, or maintenance work or work incidental thereto on the line of the issuing carrier, to the extent only that such free or reduced rate transportation is provided for in the specifications upon which the contract is based and in the contract itself.
Common carriers may also enter into contracts with telegraph and telephone corporations for an exchange of service.
Every common carrier subject to the provisions of this part may transport free or at reduced rates contractors and their employees engaged in carrying out contracts with the United States, this State, or any county or municipal government, or other governmental agency in this State, and materials or supplies for use in carrying out such contracts, in each case to the extent only that such free or reduced rate transportation is provided for in the specifications upon which the contract is based and in the contract itself.
Except as in this article otherwise provided, no public utility shall charge, or receive a different compensation for any product or commodity furnished or to be furnished, or for any service rendered or to be rendered, than the rates, tolls, rentals, and charges applicable thereto as specified in its schedules on file and in effect at the time, nor shall any public utility engaged in furnishing or rendering more than one product, commodity, or service, charge, demand, collect, or receive a different compensation for the collective, combined, or contemporaneous furnishing or rendition of two or more of such products, commodities, or services, than the aggregate of the rates, tolls, rentals, or charges specified in its schedules on file and in effect at the time, applicable to each such product, commodity, or service when separately furnished or rendered, nor shall any such public utility refund or remit, directly or indirectly, in any manner or by any device, any portion of the rates, tolls, rentals, and charges so specified, nor extend to any corporation or person any form of contract or agreement or any rule or regulation or any facility or privilege except such as are regularly and uniformly extended to all corporations and persons. The commission may by rule or order establish such exceptions from the operation of this prohibition as it may consider just and reasonable as to each public utility.
The officers and employees of the Operations and Safety Section of the Transportation Division of the commission, shall, when in the performance of their official duties, have the right to pass, free of charge, on all railroads, cars, vessels, and other vehicles of every common carrier subject to control or regulation by the commission, between points within this State, whether such railroad, car, vessel, or other vehicle is used for the transportation of passengers or freight, and regardless of its class. Such officers and employees when in the performance of their official duties shall have free access to any portion of any train, including the engine or any other units of rolling stock, and to all portions of any vessel or other vehicle of any common carrier used for the transportation of passengers or freight.
ARTICLE 4. Facilities [556. - 564.]
Every common carrier shall afford all reasonable, proper, and equal facilities for the prompt and efficient interchange and transfer of passengers between the lines owned, operated, controlled, or leased by it and the lines of every other common carrier, and shall make such interchange and transfer promptly without discrimination between passengers or carriers as to compensation charged, service rendered, or facilities afforded.
Every telephone corporation and telegraph corporation operating in this State shall receive, transmit, and deliver, without discrimination or delay, the conversations and messages of every other such corporation with whose line a physical connection has been made.
Nothing in Sections 556 to 558, inclusive, shall limit or modify the duty of a common carrier to establish joint rates, fares, and charges for the transportation of passengers and property over the lines owned, operated, controlled, or leased by it and the lines of other common carriers, or the power of the commission to require the establishment of such joint rates, fares, and charges.
Subdivision (a) is not applicable to network railroad transportation.
Upon the application of any shipper or receiver or contemplated shipper or receiver of freight for a connection between the railroad of a railroad corporation and its existing or contemplated private track or railroad, the railroad corporation shall make the connection, provide such switches and tracks as may be necessary for that purpose, and deliver and receive cars thereover, if the connection is reasonably practicable and can be installed and used without materially increasing the hazard of the operation of the railroad with which the connection is sought, and if the business which may reasonably be expected to be received by the railroad corporation over the connection is sufficient to justify the expense of the connection to the railroad corporation.
Upon the same conditions, every railroad corporation, upon the application of any shipper or receiver or contemplated shipper or receiver of freight, shall construct upon its right of way a spur or spurs for the purpose of receiving and delivering freight thereby, and shall receive and deliver freight thereby.
Every railroad corporation, passenger stage corporation, passenger air carrier, and street railroad corporation providing departures originating in this state shall prohibit the smoking of a tobacco product in the passenger seating area of every passenger car, passenger stage, aircraft, or other vehicle.
Every such corporation and carrier shall display in the passenger seating area of every passenger car, passenger stage, aircraft, or other vehicle, notices sufficient in number, posted in such locations as to be readily seen by boarding passengers, advising passengers of the no smoking requirements pursuant to subdivision (a). Words on such notices which state “No Smoking” or an equivalent phrase shall be at least three-quarters of one inch high, and any other explanatory words on the notices shall be at least one-quarter of one inch high.
No person shall smoke a tobacco product in a space known by him or her to be designated for nonsmoking passengers. A violation of this subdivision is not a crime.
As used in this section, “passenger air carrier” shall have the same meaning as provided in Sections 2741 and 2743.
For purposes of this section, “smoke” and “smoking” have the same meaning as in subdivision (c) of Section 22950.5 of the Business and Professions Code.
For purposes of this section, “tobacco product” means a product or device as defined in subdivision (d) of Section 22950.5 of the Business and Professions Code.
Whenever the commission, on its own motion or upon the complaint of a public utility, finds that public convenience and necessity require the use by a public utility of all, or any part, of the passenger vessel terminal facilities operated or controlled by the Golden Gate Bridge, Highway and Transportation District, and the district and the public utility are unable to agree upon the use or the terms and conditions or compensation therefor, the commission shall by order direct that the use by the public utility be permitted, and prescribe a reasonable compensation and reasonable terms and conditions to be charged and observed, including, but not limited to, all related costs of construction, capital improvement, leasing or rental, and maintenance.
Notwithstanding Section 27280 of the Streets and Highways Code or any other provision of law, and for purposes of this section only, the passenger vessel service of the Golden Gate Bridge, Highway and Transportation District is subject to the jurisdiction of the commission and the provisions of this part. The commission shall have no jurisdiction over the operation of passenger vessels by the Golden Gate Bridge, Highway and Transportation District or any other operation of the district except as specifically provided in this section.
The commission shall require that any public utility which provides passenger-ferry or other transportation service for the district first obtain a certificate of public convenience and necessity authorizing such operations.
Any public utility which initiates any complaint pursuant to this section shall reimburse the commission for its reasonable expenses in hearing and determining the complaint.
The commission may establish such rules as it determines necessary to carry out this section.
By January 1, 2024, the commission shall update General Order 131-D to authorize each public utility electrical corporation to use the permit-to-construct process or claim an exemption under Section III(B) of that general order to seek approval to construct an extension, expansion, upgrade, or other modification to its existing electrical transmission facilities, including electric transmission lines and substations within existing transmission easements, rights of way, or franchise agreements, irrespective of whether the electrical transmission facility is above a 200-kilovolt voltage level.
ARTICLE 5. Reports to the Commission [581. - 591.]
Every public utility shall furnish to the commission in such form and detail as the commission prescribes all tabulations, computations, and all other information required by it to carry into effect any of the provisions of this part, and shall make specific answers to all questions submitted by the commission.
Every public utility receiving from the commission any blanks with directions to fill them shall answer fully and correctly each question propounded therein, and if it is unable to answer any question, it shall give a good and sufficient reason for such failure.
Whenever required by the commission, every public utility shall deliver to the commission copies of any or all maps, profiles, contracts, agreements, franchises, reports, books, accounts, papers, and records in its possession or in any way relating to its property or affecting its business, and also a complete inventory of all its property in such form as the commission may direct.
No information furnished to the commission by a public utility, a business that is a subsidiary or affiliate of a public utility, or a corporation that holds a controlling interest in a public utility, except those matters specifically required to be open to public inspection by this part, shall be open to public inspection or made public, except on order of the commission or by the commission or a commissioner in the course of a hearing or proceeding. A present or former officer or employee of the commission who divulges that information is guilty of a misdemeanor.
Notwithstanding subdivision (a) or any other law, a present officer or employee of the commission may share information with the Independent System Operator pursuant to an agreement to treat the shared information as confidential.
Every public utility shall furnish such reports to the commission at such time and in such form as the commission may require in which the utility shall specifically answer all questions propounded by the commission. The commission may require any public utility to file monthly reports of earnings and expenses, and to file periodical or special reports, or both, concerning any matter about which the commission is authorized by any law to inquire or to keep itself informed, or which it is required to enforce. All reports shall be under oath when required by the commission.
Except as provided in subdivision (d), every public utility and business specified in subdivision (b) shall in any rate proceeding or proceeding establishing a fact or rule that may influence a rate, provide the commission with access to all computer models, as defined in Section 1821, which are used by that public utility or business to substantiate their showing in the proceeding.
The commission shall, by rule or order, with full opportunity for participation by utilities and other affected parties, establish procedures and safeguards governing its access to, and monitoring, verification, and use of, computer models of every public utility and of any business which is a commission regulated subsidiary or affiliate of a public utility with respect to any rate proceeding or proceeding establishing a fact or rule that may influence a rate. The time, place, and manner of commission access shall, to the extent practicable, be the subject of mutual agreement between the commission and the affected utility, and the parties shall make every good faith effort to reach agreement. If an agreement is reached, it shall include, but is not limited to, provisions to reasonably assure the legitimate needs for security of the public utilities’ computer resources. These provisions shall provide for the confidentiality of records, the protection of proprietary information, and the protection of the reasonable expectation of customers of public utilities in the privacy of customer-specific records maintained by the utility. If no agreement is reached, any order issued by the commission requiring computer access shall include, but is not limited to, provisions providing for the security of the utility’s data bases, confidentiality of records, protection of proprietary information, and the privacy of customer-specific records maintained by the utility. The commission shall convene a proceeding to adopt these rules as soon as possible after the operative date of the act adding this section to the code.
This section shall not expand or limit any powers of the commission to prescribe the manner of keeping books, records, and systems of accounts of public utilities and to investigate any of these books, records, systems of accounts, or memoranda under existing law, or any other power of the commission under existing law. Any utility may object to a rule or order of the commission concerning the access prescribed herein under the rules of procedure of the commission consistent with existing law.
This section does not apply to common carriers.
Every water corporation with more than 2,000 service connections, and every electrical, gas, and telephone corporation shall annually prepare and submit to the commission a report describing all significant transactions, as specified by the commission, between the corporation and every subsidiary or affiliate of, or corporation holding a controlling interest in, the water, electrical, gas, or telephone corporation. The report shall identify the nature of the transactions and the terms and conditions applying to them, including, but not limited to, the basis upon which cost allocations and transfer pricing were established for the transactions.
Notwithstanding any regulation, tariff, opinion, or interim opinion of the Public Utilities Commission, or any other provision of law, an inspector or investigator, as defined in Section 830.1 of the Penal Code, who is employed in the office of a district attorney may request and shall receive from telephone, gas, and electric public utilities customer information limited to the full name, date of birth, social security number, address, prior address, forwarding address, place of employment, and date of service instituted, terminated, or suspended by, utility customers to the extent the information is stored within the utility records and computer data bases. However, in no case shall information be released disclosing customer usage of the services provided by the utility without a court order or subpoena.
In order to protect the privacy interest of utility customers, a request to a public utility for customer information pursuant to this section shall meet the following requirements:
The requested information is relevant and material to an investigation pursuant to Sections 3130, 3131, 3132, 3133, and 3134 of the Family Code concerning the kidnapping, abduction, concealment, detention, or retention of a minor child and that the inspector or investigator requesting the information has a reasonable, good faith belief that the utility customer information is needed to assist the inspector or investigator in the location or recovery of a minor child or abductor, coconspirator or aider and abettor of the continuing crime of child abduction or concealment.
Only inspectors and investigators as defined in Section 830.1 of the Penal Code, who are employed in the office of a district attorney whose names have been submitted to the utility in writing by a district attorney’s office, may request and receive customer and customer service information pursuant to this section. Each district attorney’s office shall ensure that each public utility has at all times a current list of the names of inspectors and investigators authorized to request and receive customer and customer service information. Each district attorney’s office shall immediately notify the utility in writing and withdraw the names of inspectors and investigators from the authorized list who no longer have a need for the access.
This section does not authorize inspectors and investigators to obtain any utility customer information, other than that authorized by this section, without proper service of process as required by law.
The district attorney’s office requesting and receiving utility information shall ensure its confidentiality. At no time shall any information obtained pursuant to this section be disclosed or used for any purpose other than to assist in the location or recovery of a person or persons specified in paragraph (1).
The inspector or investigator requesting utility information authorized for release by this section shall make a record on a form created and maintained by the district attorney’s office, which shall include the name of the utility customer about whom the inquiry was made, the name of the inspector or investigator making the inquiry, the date of inquiry, the name of the utility, the utility employee to whom the request was made, and the information that was requested and received.
The inspector or investigator requesting information pursuant to this section shall prepare and sign, under penalty of perjury, a written affidavit of probable cause, which shall be contained on a form created by the Attorney General’s office in consultation with telephone, gas, and electric utilities. The form shall be retained by the utility for a period of one year and shall contain a statement of all the facts known to the inspector or investigator that support the existence of all of the requirements of this section. The affidavit shall also contain a statement of exigent circumstances, explaining why the inspector or investigator could not seek and obtain a search warrant, court order, or other court process for the production of the information sought.
No public utility, or official or employee thereof, shall be subject to criminal or civil liability for the release of customer information in reasonable reliance on an affidavit appearing on its face to be valid, and which was submitted by a person whose name appears on the current authorization list, as required in paragraph (2) of subdivision (b). However, any person who willfully violates any provision of this section is guilty of a misdemeanor, pursuant to Section 2112.5.
The utility receiving the request for customer information may charge the requesting district attorney’s office a reasonable fee for the search and release of the requested information and for the storage of the required forms.
In an existing or new proceeding, the commission shall require the electrical and gas corporations to cooperate in establishing a single Internet Web site available to the public that provides up-to-date information, updated no less frequently than once every 30 days, regarding ratepayer-funded energy efficiency assistance programs that, to the extent the information is available, in an aggregate format that would not provide identifying information about individual customers of the electrical and gas corporations, include all of the following:
The types of energy efficiency measures installed.
The ZIP Code location of each customer receiving ratepayer-funded energy efficiency assistance.
The amount of funds expended at each ZIP Code location.
The expected annual energy savings and reduced energy usage expected in kilowatthours or therms.
The commission shall order the electrical and gas corporations to establish, based on data, ratepayer-funded energy efficiency assistance program reports on program totals, geographical and monthly statistics, cost distribution, and progress toward program goals.
The electrical and gas corporations shall make the reports available on the Internet Web site established pursuant to subdivision (a).
The commission shall require the electrical and gas corporations to publish data, including the amount expended, on the ratepayer-funded energy efficiency programs that are not direct retrofits, including, but not limited to, research on building and appliance standards and marketing and outreach, on the Internet Web site established pursuant to subdivision (a).
The commission shall take steps necessary to ensure the Internet Web site established pursuant to subdivision (a) is available to the public on or before June 1, 2014.
The commission shall have a link to the Internet Web site established pursuant to subdivision (a) on the commission’s Internet Web site and require the electrical and gas corporations to have a link to the Internet Web site established pursuant to subdivision (a) on the appropriate page of the Internet Web site of each electrical and gas corporation.
The commission shall require each electrical corporation to report annually on its compliance with the standards or rules adopted by the commission pursuant to Section 364. That report shall be made available to the public, except that the commission may, consistent with other provisions of law, withhold from the public information generated or obtained pursuant to this section that it deems would pose a security threat to the public if disclosed.
The commission shall require an electrical or gas corporation to annually notify the commission, as part of an ongoing proceeding or in a report otherwise required to be submitted to the commission, of each time since that notification was last provided that capital or expense revenue authorized by the commission for maintenance, safety, or reliability was redirected by the electrical or gas corporation to other purposes.
The commission shall ensure that the notification provided by each electrical or gas corporation is also made available in a timely fashion to the Office of the Safety Advocate, Public Advocate’s Office of the Public Utilities Commission, and parties on the service list of any relevant proceeding.
ARTICLE 6. Relocation Assistance [600. - 600.]
A public utility acquiring real property by eminent domain shall provide relocation advisory assistance and shall make any of the payments required of public entities by Chapter 16 (commencing with Section 7260) of Division 7 of Title 1 of the Government Code.
ARTICLE 7. Eminent Domain [610. - 626.]
This article applies only to a corporation or person that is a public utility.
A railroad corporation may condemn any property necessary for the construction and maintenance of its railroad.
An electrical corporation may condemn any property necessary for the construction and maintenance of its electric plant.
A gas corporation may condemn any property necessary for the construction and maintenance of its gas plant.
A heat corporation may condemn any property necessary for the construction and maintenance of its heating plant.
A pipeline corporation may condemn any property necessary for the construction and maintenance of its pipeline.
A telephone corporation may condemn any property necessary for the construction and maintenance of its telephone line.
Notwithstanding Section 616, a telephone corporation may not condemn any property on an airport owned by a city and county, and located in another county, unless that property is necessary for that telephone corporation to provide telecommunications as a carrier of last resort seeking to serve an unserved area.
A telegraph corporation may condemn any property necessary for the construction and maintenance of its telegraph line.
A water corporation may condemn any property necessary for the construction and maintenance of its water system.
A wharfinger may condemn any property necessary for the construction and maintenance of facilities for the receipt or discharge of freight or passengers.
A common carrier, as defined in subdivision (b) of Section 211, may condemn any property necessary for the construction and maintenance of facilities for its transportation of persons or property.
A street railroad corporation may condemn any property necessary for the construction and maintenance of its street railroad.
As used in this section, “motor carrier” means:
A passenger stage corporation as defined in Section 226.
As used in this section, “water carrier” means a common carrier operating upon any waterway in this state between fixed termini or over a regular route.
A motor carrier or water carrier may condemn any property necessary for the construction and maintenance of terminal facilities for the receipt, transfer, or delivery of the passengers or property it carries or for other terminal facilities of any such carrier.
A warehouseman may condemn any property necessary for the construction and maintenance of its facilities for storing property.
A sewer system corporation may condemn any property necessary for the construction and maintenance of its sewer system.
For the purpose of this article, except as specified in paragraph (4), a public utility that offers competitive services may not condemn any property for the purpose of competing with another entity in the offering of those competitive services, unless the commission finds that such an action would serve the public interest, pursuant to a petition or complaint filed by the public utility, personal notice of which has been served on the owners of the property to be condemned, and an adjudication hearing in accordance with Chapter 9 (commencing with Section 1701), including an opportunity for the public to participate.
The requirements of this section do not apply to the condemnation of any property that is necessary solely for an electrical company or gas corporation to meet its commission-ordered obligation to serve. Proposed exercises of eminent domain by electrical or gas corporations that initially, or subsequently, acquire property for either commission-ordered electrical corporation obligation to serve and competitive telecommunications services or gas corporation obligation to serve and telecommunications services are subject to paragraph (2) of subdivision (b). For property acquired through the exercise of eminent domain after January 1, 2000, by an electrical or gas corporation solely to meet its commission-ordered obligation to serve, any electrical or gas corporation, or subsidiary or affiliate, that intends to install telecommunication equipment on the property for the purpose of providing competitive telecommunications services shall provide notice for the planned installation in the commission calendar.
Before making a finding pursuant to this subdivision, the commission shall conduct the hearing in the local jurisdiction that would be affected by the proposed condemnation. The hearing shall commence within 45 days of the date that the petition or complaint is filed, unless the respondent establishes that an extension of not more than 30 days is necessary for discovery or other hearing preparation. The commission shall provide public notice of the hearing pursuant to the procedures of the commission and shall also notify the local jurisdiction. In addition, the commission shall provide the local jurisdiction with copies of the notice of hearing in time for the local jurisdiction to mail that notice at least seven days in advance of the hearing to all persons who have requested copies of the local jurisdiction’s agenda or agenda packet pursuant to Section 54954.1 of the Government Code.
For purposes of subparagraph (A), “local jurisdiction” means each city within whose boundaries property sought to be taken by eminent domain is located, and if property sought to be taken is not located within city boundaries, each county within whose boundaries that property is located. However, where there is more than one local jurisdiction with respect to a single complaint or petition, the commission shall provide notice and copies of notices for mailing to all local jurisdictions involved, but shall hold only a single hearing in any one of those local jurisdictions.
The assigned commissioner or administrative law judge shall render a decision on making a finding in accordance with this subdivision within 45 days of the conclusion of the hearing, unless further briefing is ordered, in which event this period may be extended by up to 30 additional days to allow for briefing.
If the rendering of a decision pursuant to this subdivision requires review under the California Environmental Quality Act (Division 13 (commencing with Section 21000) of the Public Resources Code), then the time limits contained in subparagraph (A) of paragraph (2) and subparagraph (A) of paragraph (3) shall be extended as needed to accommodate that review.
This subdivision and Section 626 do not apply to a railroad corporation, a refined petroleum product common carrier pipeline corporation, or a water corporation.
The commission may make a finding pursuant to subdivision (a) if, in the determination of the commission, either of the following conditions is met:
The proposed condemnation is necessary to provide service as a provider of last resort to an unserved area, except when there are competing offers from facility-based carriers to serve that area.
The public utility is able to show all of the following with regard to the proposed condemnation:
The public interest and necessity require the proposed project.
The property to be condemned is necessary for the proposed project.
The public benefit of acquiring the property by eminent domain outweighs the hardship to the owners of the property.
The proposed project is located in a manner most compatible with the greatest public good and least private injury.
The commission shall develop procedures to facilitate access for affected property owners to eminent domain proceedings pursuant to this section, and to facilitate the participation of those owners in those proceedings.
Nothing in this section relieves a public utility from complying with Section 1240.030 of the Code of Civil Procedure or any other requirement imposed by law.
A public utility that does not comply with this section may not exercise the power of eminent domain, including, but not limited to, any authority provided by Title 7 (commencing with Section 1230.010) of Part 3 of the Code of Civil Procedure.
The authority provided in this section supplements, and does not replace or otherwise affect any other limitation in law on the exercise of the power of eminent domain, including, but not limited to, any authority provided by Title 7 (commencing with Section 1230.010) of Part 3 of the Code of Civil Procedure.
At the request of a public utility gas corporation, the commission shall hold the local hearing required in subparagraphs (A) and (B) of paragraph (2) of subdivision (a) and make and certify the finding required by paragraph (1) of subdivision (a) as part of the procedure to issue a certificate of public convenience and necessity.
Notwithstanding any other provision of law, if the commission holds public hearings during the certification procedure for the purpose of making the determination required under paragraph (2) of subdivision (b), the commission shall have an additional 45 days beyond the date of any otherwise applicable statutory or regulatory deadline for making a determination.
On or after January 1, 2000, a public utility may not enter into any exclusive access agreement with the owner or lessor of, or a person controlling or managing, a property or premises served by the public utility, or commit or permit any other act, that would limit the right of any other public utility to provide service to a tenant or other occupant of the property or premises.
ARTICLE 8. Consultant and Advisory Services [631. - 633.]
In addition to the requirements of Article 1 (commencing with Section 1001) of Chapter 5 and any other provisions of law, the commission shall require every electrical corporation and every gas corporation proposing to construct or modify any electric plant or gas plant at a cost in excess of one hundred million dollars ($100,000,000) to reimburse the commission for expenses of such consultants or advisory services as the commission deems necessary for either or both of the following:
The processing of an application for certification of the plant.
The processing of an application for approval of any rate increase reflecting the inclusion of the cost of the plant in the rates of the corporation. This subdivision applies to any plant for which the costs of construction or modification are approved for inclusion in the corporation’s rates on or after January 1, 1983.
For purposes of entering into contracts for consultant or advisory services, the requirements of Sections 11042 and 14615 of the Government Code and Sections 10295 and 10318 of the Public Contract Code apply to the activities of the commission, except when the commission makes a finding that extraordinary circumstances justify expedited contracting for consultant or advisory services.
The requirements of Section 632 do not apply to contracts for legal services. The commission shall notify the Attorney General when contracting for legal services by attorneys who are not employees of the commission.
ARTICLE 9. Long-Term Plans and Procurement Plans [635. - 635.]
In a long-term plan adopted by an electrical corporation or in a procurement plan implemented by a local publicly owned electric utility, the electrical corporation or local publicly owned electric utility shall adopt a strategy applicable both to newly constructed and repowered generation owned and procured by the electrical corporation or local publicly owned electric utility to achieve efficiency in the use of fossil fuels and to address emissions of greenhouse gases.
ARTICLE 10. Biomethane Procurement [650. - 651.]
For purposes of this article, “biomethane” means methane produced from an organic waste feedstock that meets the standards adopted pursuant to subdivisions (c) and (d) of Section 25421 of the Health and Safety Code for injection into a common carrier pipeline and that meets either of the following requirements:
The methane is produced from the anaerobic decomposition of organic material, including codigestion.
The methane is produced from the noncombustion thermal conversion of any of the following materials, when separated from other waste:
Agricultural crop residues.
Bark, lawn, yard, and garden clippings.
Leaves, silvicultural residue, and tree and brush prunings.
Wood, wood chips, and wood waste.
Nonrecyclable pulp or nonrecyclable paper materials.
Livestock waste.
Municipal sewage sludge or biosolids.
The commission, in consultation with the State Air Resources Board, shall consider adopting specific biomethane procurement targets or goals for each gas corporation and core transport agent, as defined in Section 980, so that each gas corporation and core transport agent procures a proportionate share, as determined by the commission, of biomethane annually. Before establishing biomethane procurement targets or goals, the commission shall make both of the following findings:
The targets or goals are cost-effective means of achieving the forecast reduction in the emissions of short-lived climate pollutants pursuant to Section 39730.5 of the Health and Safety Code and other greenhouse gases pursuant to the California Global Warming Solutions Act of 2006 (Division 25.5 (commencing with Section 38500) of the Health and Safety Code).
The targets or goals comply with all applicable state and federal laws.
If the commission adopts specific biomethane procurement targets or goals for each gas corporation and core transport agent pursuant to subdivision (a), the commission shall do all of the following:
Consider the recommendations developed pursuant to Section 39730.8 of the Health and Safety Code.
Ensure that biomethane eligible for any procurement program meets one of the following conditions:
The biomethane is delivered to California through a dedicated pipeline.
The biomethane is delivered to California through a common carrier pipeline and meets both of the following requirements:
The source of biomethane injects the biomethane into a common carrier pipeline that physically flows within California, or toward the end user in California for which the biomethane was produced.
The seller or purchaser of the biomethane demonstrates that the capture or production of biomethane directly results in at least one of the following environmental benefits to California:
The reduction or avoidance of the emission of any criteria air pollutant, toxic air contaminant, or greenhouse gas in California.
(II) The reduction or avoidance of pollutants that could have an adverse impact on waters of the state.
(III) The alleviation of a local nuisance within California that is associated with the emission of odors.
Authorize a core transport agent to enter into an agreement with a gas corporation for the gas corporation to procure the core transport agent’s proportionate share of biomethane in order to satisfy the specific biomethane procurement targets or goals adopted by the commission, with all costs paid for by the core transport agent and any environmental attributes allocated by the commission in a fair and transparent manner.
The commission shall initially allocate each core transport agent their proportional share of the existing biomethane procurement targets established by commission Decision 22-02-025 (February 24, 2022) Decision Implementing Senate Bill 1440 Biomethane Procurement Program. This subdivision shall not prohibit the commission from establishing additional biomethane targets.
ARTICLE 11. Neighborhood Decarbonization Zone Pilot Projects [660. - 666.]
For purposes of this article, the following definitions apply:
“Disadvantaged community” means a community identified pursuant to Section 39711 of the Health and Safety Code.
“Distribution integrity management plan” means a plan developed pursuant to Part 192 (commencing with Section 192.1) of Subchapter D of Chapter I of Subtitle B of Title 49 of the Code of Federal Regulations.
“Gas distribution line” means either a gas distribution main line or gas distribution service line.
“Gas distribution main line” has the same meaning as “main” set forth in Section 192.3 of Title 49 of the Code of Federal Regulations.
“Gas distribution service line” has the same meaning as “service line” set forth in Section 192.3 of Title 49 of the Code of Federal Regulations.
“Low-income” means having a household income no greater than 80 percent of area median income or qualifying for participation in the California Alternate Rates for Energy (CARE) program or Family Electric Rate Assistance (FERA) program.
“Priority neighborhood decarbonization zone” means a zone identified pursuant to Section 662.
“Thermal energy network” means a network of piped noncombustible fluids used for transferring heat into and out of buildings for purposes of providing zero-emission heating and cooling services.
“Tribe” means a California Native American tribe, as defined in Section 21073 of the Public Resources Code.
“Zero-emission alternatives” means methods of providing gas customers with suitable substitute energy service that does not require new investment in gas distribution lines, including, but not limited to, electrification of gas end uses and energy efficiency, thermal energy networks, and demand flexibility measures to alter energy needs.
On or before July 1, 2025, and each year thereafter, each gas corporation shall submit to the commission a map that includes all of the following:
The location of all potential gas distribution line replacement projects identified in its distribution integrity management plan and any foreseeable gas distribution pipeline replacements.
The city, county, and census tract boundaries within the gas corporation’s service territory.
Locations of disadvantaged communities, tribes, and priority neighborhood decarbonization zones, as designated by the commission pursuant to Section 662, that are within the gas corporation’s service territory.
Any additional information required by the commission.
This section does not modify a gas corporation’s safety requirements under state or federal law.
On or after January 1, 2030, the commission may determine whether gas corporations will continue to be subject to the requirements of this section.
On or before January 1, 2026, in a new or existing proceeding and following recommendations from each gas corporation and the opportunity for public comment, the commission shall designate priority neighborhood decarbonization zones. In designating the zones, the commission shall consider factors that include, but are not limited to, all of the following:
Presence of disadvantaged or low-income communities in high-temperature climate zones or low-temperature climate zones that disproportionately lack cooling or heating.
Presence of environmental and social justice communities as defined in the commission’s Environmental and Social Justice Action Plan.
Availability of supportive local government or community partners.
Concentration of gas distribution line replacement projects identified in the map submitted pursuant to Section 661.
The commission shall coordinate with relevant agencies to identify nonratepayer funding, such as state and federal funds, that may be used to execute pilot projects in priority neighborhood decarbonization zones that would be cost effective with supplemental nonratepayer funding.
If pilot projects for zero-emission alternatives pursuant to Section 663 are implemented in a priority neighborhood decarbonization zone, the commission may direct gas corporations and electrical corporations, if appropriate, to leverage other available programs, including, but not limited to, energy efficiency, low-income weatherization, and distributed generation programs.
The commission may, after providing an opportunity for public comment, update the priority neighborhood decarbonization zones as necessary.
On or before July 1, 2026, in a new or existing proceeding, the commission, in consultation with the state’s gas corporations, shall establish a voluntary program to facilitate the cost-effective decarbonization of priority neighborhood decarbonization zones, not to exceed 30 pilot projects across the state and affecting no more than 1 percent of each gas corporation’s customers within their service territory. A pilot project where a gas corporation obtains the consent of 100 percent of property owners with natural gas service within the pilot project boundary shall not count toward the 30 pilot project limit.
In administering the pilot projects established pursuant to subdivision (a), the commission shall establish all of the following:
A process for gas corporations to determine and submit pilot projects for approval.
Criteria and methodology for determining the cost-effectiveness of a zero-emission alternative as compared to replacement, repair, or continued operation of the affected asset of the gas system. Nonenergy benefits may be considered in prioritizing pilot projects, but shall not be used to calculate cost-effectiveness. The total cost incurred by the gas corporation for the zero-emission alternative shall be less than the total cost that would have otherwise occurred. Gas corporations shall use nonratepayer funding when available.
Requirements and programs to ensure that a substitute for gas service for low-income customers is affordable, adequate, efficient, and just and reasonable.
A requirement that no less than 67 percent of the property owners with natural gas service within the pilot project boundary consent to the pilot project. The commission shall establish the manner in which consent shall be received and notifications about the pilot project shall be provided to property owners and affected customers. Notifications shall include information about the anticipated costs and benefits of the zero-emission alternative offering. Notifications shall be made available in the zone’s prevailing languages.
A requirement for addressing master-metered properties to ensure tenants receive adequate notification and engagement.
A preference for pilot projects that provide prevailing wages and use high road job programs.
A requirement that gas corporations and electrical corporations, local publicly owned electric utilities, load-serving entities, local governments, and, if feasible, core transport agents affected by the pilot project coordinate and collaborate.
A requirement that gas corporations recover costs related to the pilot projects that are deemed just and reasonable and a requirement that prohibits a gas corporation from recovering behind-the-meter costs associated with the pilot projects as capital costs that are afforded a rate of return.
The appropriate rate of return and recovery period that a gas corporation is eligible to receive for its costs to implement a zero-emission alternative. A gas corporation shall not receive ratepayer funding for the costs of a zero-emission alternative that are covered by incentives under federal, state, or local laws.
Notwithstanding any other law, if the commission approves a pilot project proposed by a gas corporation pursuant to subdivision (a), the commission shall, pursuant to Section 451.9, relieve the gas corporation of its obligation to provide service within the pilot project boundary upon completion of all affected customers’ conversion to zero-emission alternatives. A property owner’s withholding of consent to a pilot project shall not give rise to a right to continued natural gas service if the commission approves a pilot project that includes that property within its boundary.
The commission shall not establish pilot projects under this section on or after January 1, 2030.
Beginning on January 1, 2029, the commission, in a new or existing proceeding, shall review the efficacy of the pilot projects established pursuant to Section 663 in providing benefits to gas corporation customers and in assisting the state in meeting the state’s climate change goals.
On or before March 1, 2030, the commission shall submit to the relevant policy committees of the Legislature a report on the review performed pursuant to paragraph (1).
On or before March 1, 2026, and on or before March 1 of each year thereafter, the commission shall submit a progress report to the relevant policy committees of the Legislature summarizing the findings of the pilot projects, including the locations of the pilot projects, the number of customers affected, the costs of the pilot projects, the funding used to pay for the pilot projects, any assistance provided to customers, and any outcomes, challenges, and recommendations.
Reports submitted pursuant to this section shall be submitted in compliance with Section 9795 of the Government Code.
In a new or existing proceeding, the commission shall evaluate the costs and benefits of thermal energy networks and identify potential implementation barriers.
Except as provided in subdivision (b) or (c), this article shall remain in effect only until January 1, 2031, and as of that date is repealed.
Notwithstanding subdivision (a), a pilot project that has been established pursuant to Section 663 and is pending as of January 1, 2031, may continue until the completion of the pilot project.
Subdivision (a) does not affect the commission’s authorization to relieve a gas corporation of its obligation to provide service within a pilot project boundary under subdivision (c) of Section 663.
CHAPTER 4. Regulation of Public Utilities [701. - 940.]
ARTICLE 1. Generally [701. - 719.]
The commission may supervise and regulate every public utility in the State and may do all things, whether specifically designated in this part or in addition thereto, which are necessary and convenient in the exercise of such power and jurisdiction.
The Legislature finds and declares that, in addition to other ratepayer protection objectives, a principal goal of electric and natural gas utilities’ resource planning and investment shall be to minimize the cost to society of the reliable energy services that are provided by natural gas and electricity, and to improve the environment and to encourage the diversity of energy sources through improvements in energy efficiency, the development of renewable energy resources, such as wind, solar, biomass, and geothermal energy, and widespread transportation electrification.
The amendment made to this subdivision by the Clean Energy and Pollution Reduction Act of 2015 (Chapter 547 of the Statutes of 2015) does not expand the authority of the commission beyond that provided by other law.
The Legislature further finds and declares that, in addition to any appropriate investments in energy production, electrical and natural gas utilities should seek to exploit all practicable and cost-effective conservation and improvements in the efficiency of energy use and distribution that offer equivalent or better system reliability and that are not being exploited by any other entity.
In calculating the cost-effectiveness of energy resources, including conservation and load management options, the commission shall include, in addition to other ratepayer protection objectives, a value for any costs and benefits to the environment, including air quality. The commission shall ensure that any values it develops pursuant to this section are consistent with values developed by the Energy Commission pursuant to Section 25000.1 of the Public Resources Code. However, if the commission determines that a value developed pursuant to this subdivision is not consistent with a value developed by the Energy Commission pursuant to subdivision (c) of Section 25000.1 of the Public Resources Code, the commission may nonetheless use this value if, in the appropriate record of its proceedings, it states its reasons for using the value it has selected.
In determining the emission values associated with the current operating capacity of existing electric powerplants pursuant to subdivision (c), the commission shall adhere to the following protocol in determining values for air quality costs and benefits to the environment. If the commission finds that an air pollutant that is subject to regulation is a component of residual emissions from an electric powerplant and that the owner of that powerplant is either of the following:
Using a tradable emission allowance, right, or offset for that pollutant, which (A) has been approved by the air quality district regulating the powerplant, (B) is consistent with federal and state law, and (C) has been obtained, authorized, or acquired in a market-based system.
Paying a tax per measured unit of that pollutant.
The commission shall not assign a value or cost to that residual pollutant for the current operating capacity of that powerplant because the alternative protocol for dealing with the pollutant operates to internalize its cost for the purpose of planning for and acquiring new generating resources.
The values determined pursuant to subdivision (c) to represent costs and benefits to the environment shall not be used by the commission, in and of themselves, to require early decommissioning or retirement of an electric utility powerplant that complies with applicable prevailing environmental regulations.
Further, the environmental values determined pursuant to subdivision (c) shall not be used by the commission in a manner that, when those values are aggregated, will result in advancing an electric utility’s need for new powerplant capacity by more than 15 months.
This subdivision shall apply whenever a powerplant bid solicitation is required by the commission for an electric utility and a portion of the amount of new powerplant capacity, which is the subject of the bid solicitation, is the result of the commission’s use of environmental values to advance that electric utility’s need for new powerplant capacity in the manner authorized by paragraph (2) of subdivision (e). The affected electric utility may propose to the commission any combination of alternatives to that portion of the new powerplant capacity that is the result of the commission’s use of environmental values as authorized by paragraph (2) of subdivision (c). The commission shall approve an alternative in place of the new powerplant capacity if it finds all of the following:
The alternative has been approved by the relevant air quality district.
The alternative is consistent with federal and state law.
The alternative will result in needed system reliability for the electric utility at least equivalent to that which would result from bidding for new powerplant capacity.
The alternative will result in reducing system operating costs for the electric utility over those that would result from the process of bidding for new powerplant capacity.
The alternative will result in equivalent or better environmental improvements at a lower cost than would result from bidding for new powerplant capacity.
This section does not require an electric utility to alter the dispatch of its powerplants for environmental purposes.
This section does not preclude an electric utility from submitting to the commission any combination of alternatives to meet a commission-identified need for new capacity, if the submission is otherwise authorized by the commission.
This section does not change or alter any provision of commission Decision 92-04-045 (April 22, 1992), Application of Pacific Gas and Electric Company for an Ex Parte Order Approving Settlement Agreements Between Pacific Gas and Electric Company and Certain Winning Bidders in Pacific Gas and Electric Company’s Biennial Resource Plan Update Auction.
Until the commission completes an electric generation procurement methodology that values the environmental and diversity costs and benefits associated with various generation technologies, the commission shall direct that a specific portion of future electrical generating capacity needed for California be reserved or set aside for renewable resources.
It is the policy of the state and the intent of the Legislature that state and municipal electric resource acquisition programs recognize and include a value for the resource diversity provided by renewable resources.
With respect to financing arrangements which are established after January 1, 1988, no electrical, gas, or telephone corporation, whose rates are set by the commission on a cost-of-service basis, shall issue any bond, note, lien, guarantee, or indebtedness of any kind pledging the utility assets or credit for or on behalf of any subsidiary or affiliate of, or corporation holding a controlling interest in, the electrical, gas, or telephone corporation. The commission may, however, authorize an electrical, gas, or telephone corporation to issue any bond, note, lien, guarantee, or indebtedness pledging the utility assets or credits as follows:
For or on behalf of a subsidiary if its revenues and expenses are included by the commission in establishing rates for the electrical, gas, or telephone corporation.
For or on behalf of a subsidiary if it is engaged in a regulated public utility business in this state or in any other state.
For or on behalf of a subsidiary or affiliate if it engages in activities which support the electric, gas, or telephone corporation in its operations or service, these activities are, or will be, regulated either by the commission or a comparable federal agency, and the issuance of the bond, note, lien, guarantee, or indebtedness is specifically approved in advance by the commission.
The commission shall not approve the bond, note, lien, guarantee, or indebtedness unless the commission finds and determines that the proposed financing will benefit the interests of the utility and its ratepayers.
The commission may authorize gas and electrical corporations to include in ratepayer-supported research and development programs, activities that relate to improving the energy efficiency of manufactured housing and mobilehomes if those programs are evaluated in accordance with the guidelines established by Section 740.1. The commission may develop a program involving utilities, representatives of the manufactured housing and mobilehome industries, and organizations representing senior citizens and consumers to increase the construction and marketing of energy efficiency measures for mobilehomes and manufactured housing.
The commission may authorize gas and electrical corporations to provide incentives to seniors, low-income households, and others who buy new manufactured homes, or mobilehomes, which incorporate energy efficient measures.
The commission may authorize gas and electrical corporations to recover through rates the reasonable costs associated with the programs specified in subdivisions (a) and (b).
To ensure that electrical corporations do not operate their transmission and distribution monopolies in a manner that impedes the ability of the San Francisco Bay Area Rapid Transit District (BART District) to reduce its electricity cost through the purchase and delivery of preference power, electrical corporations shall meet the requirements of this section.
Any electrical corporation that owns and operates transmission and distribution facilities that deliver electricity at one or more locations to the BART District’s system shall, upon request by the BART District, and without discrimination or delay, use the same facilities to do any or all of the following:
Deliver preference power purchased from a federal power marketing agency or its successor.
Deliver electricity purchased from a local publicly owned electric utility.
Deliver electricity generated by an eligible renewable energy resource.
Deliver electricity purchased from an electrical corporation or marketer.
Deliver electricity purchased through a market operated by the Independent System Operator.
Where the BART District purchases electricity at more than one location, at any voltage, from an electric utility under tariffs regulated by the commission, the utility shall bill the BART District for usage as though all the electricity purchased at transmission level voltages were metered by a single meter at one location and all the electricity purchased at subtransmission voltages were metered by a single meter at one location, provided that any billing for demand charges would be based on the coincident demand of transmission and distribution metering.
If, on or after January 1, 1996, the BART District leases or has agreed to lease, as special facilities, utility plants for the purpose of receiving power at transmission level voltages, an electrical corporation may not terminate the lease without concurrence from the BART District.
When the BART District elects to have electricity delivered pursuant to subdivision (b), Sections 365, 365.1, and 366, and any commission regulations, orders, or tariffs, that implement direct transactions, are inapplicable, and the BART District is not an electricity supplier. Neither the commission, nor any electrical corporation that delivers the electricity described in subdivision (b) to the BART District, shall require that an electricity supplier be designated as a condition of the delivery of that electricity.
The BART District may elect to obtain electricity from the following multiple sources at the same time:
Electricity delivered pursuant to subdivision (b).
Electricity supplied by one or more direct transactions.
Electricity from any electrical corporation that owns and operates transmission and distribution facilities that deliver electricity at one or more locations to the BART District’s system.
The BART District shall annually report to the Energy Commission the information for the previous calendar year required of retail electricity suppliers in Article 14 (commencing with Section 398.1) of Chapter 2.3, including all of the following:
The kilowatthours purchased from specified sources, by generator and fuel type during the previous calendar year, consistent with meter data, including losses, reported to the system operator.
The kilowatthours purchased from unspecified sources in California and from unspecified sources imported into California from other subregions within the Western Electricity Coordinating Council.
The kilowatthours consumed by the BART District.
For purposes of this section, the following terms have the following meanings:
“Electricity from specified sources” or “purchases from specified sources” means electricity transactions that are traceable to a specific generation source by any auditable contract trail or equivalent, such as a tradable commodity system, that provides commercial verification that the electricity source claimed has been sold once, and only once, to an end user. The BART District may rely on annual data to determine whether a transaction meets this definition, rather than hour-by-hour matching of loads and resources.
“Electricity from unspecified sources” or “purchases from unspecified sources” means electricity that is not traceable to a specific generation source by any auditable contract trail or equivalent, including a tradable commodity system, that provides commercial verification that the electricity source claimed has been sold once, and only once, to an end user.
“Eligible renewable energy resources” means an eligible renewable energy resource pursuant to the California Renewables Portfolio Standard Program (Article 16 (commencing with Section 399.11) of Chapter 2.3).
“Marketer” has the same meaning as defined in subdivision (e) of Section 331.
“System operator” has the same meaning as defined in Section 398.2.
The policy of the State of California is that rates and charges established by the commission for water service provided by water corporations shall do all of the following:
Provide revenues and earnings sufficient to afford the utility an opportunity to earn a reasonable return on its used and useful investment, to attract capital for investment on reasonable terms and to ensure the financial integrity of the utility.
Minimize the long-term cost of reliable water service to water customers.
Provide appropriate incentives to water utilities and customers for conservation of water resources.
Provide for equity between present and future users of water service.
Promote the long-term stabilization of rates in order to avoid steep increases in rates.
Be based on the cost of providing the water service including, to the extent consistent with the above policies, appropriate coverage of fixed costs with fixed revenues.
Every public utility shall obey and comply with every order, decision, direction, or rule made or prescribed by the commission in the matters specified in this part, or any other matter in any way relating to or affecting its business as a public utility, and shall do everything necessary or proper to secure compliance therewith by all of its officers, agents, and employees.
The commission may investigate all existing or proposed interstate rates, fares, tolls, charges, and classifications, and all rules and practices in relation thereto, for or in relation to the transportation of persons or property or the transmission of messages for conversations, where any act in relation thereto takes place within this state and when they are, in the opinion of the commission, in violation of federal law, or in conflict with the rulings, orders, or regulations of the a federal agency, the commission may apply for relief by petition or otherwise to the federal agency that has jurisdiction over the alleged violation or to any court of competent jurisdiction.
Except as otherwise provided in this section, no foreign corporation, other than those which by compliance with the laws of this State are entitled to transact a public utility business within this State, shall henceforth transact within this State any public utility business, nor shall any foreign corporation which is at present lawfully transacting business within this State henceforth transact within this State any public utility business of a character different from that which it is at present authorized by its charter or articles of incorporation to transact. No license, permit, or franchise to own, control, operate, or manage any public utility business or any part or incident thereof shall be henceforth granted or transferred, directly or indirectly, to any foreign corporation which is not at present lawfully transacting within this State a public utility business of like character.
Foreign corporations engaging in commerce with foreign nations or commerce among the several states may transact within this State such commerce and intrastate commerce of a like character; provided, however, that no such foreign corporation shall be permitted to engage in intrastate commerce within this State until it shall have first complied with the laws of this State respecting foreign corporations. Any foreign corporation which complies with the laws of this State respecting foreign corporations, and which owns at least 90 percent of the outstanding capital stock of any other foreign corporation transacting a public utility business in this State, may succeed to the public utility business, franchises, and rights of such latter corporation and, thereafter continue and carry on such public utility business.
For purposes of this section, “compensation” means any annual salary, bonus, benefits, or other consideration of any value, paid to an officer of an electrical corporation or gas corporation.
An electrical corporation or gas corporation shall not recover expenses for compensation from ratepayers. Compensation shall be paid solely by shareholders of the electrical corporation or gas corporation.
Not later than March 1, 2012, the commission shall institute a rulemaking proceeding for the purpose of considering and adopting a code of conduct, associated rules, and enforcement procedures, to govern the conduct of the electrical corporations relative to the consideration, formation, and implementation of community choice aggregation programs authorized in Section 366.2. The code of conduct, associated rules, and enforcement procedures, shall do all of the following:
Ensure that an electrical corporation does not market against a community choice aggregation program, except through an independent marketing division that is funded exclusively by the electrical corporation’s shareholders and that is functionally and physically separate from the electrical corporation’s ratepayer-funded divisions.
Limit the electrical corporation’s independent marketing division’s use of support services from the electrical corporation’s ratepayer-funded divisions, and ensure that the electrical corporation’s independent marketing division is allocated costs of any permissible support services from the electrical corporation’s ratepayer-funded divisions on a fully allocated embedded cost basis, providing detailed public reports of such use.
Ensure that the electrical corporation’s independent marketing division does not have access to competitively sensitive information.
Incorporate rules that the commission finds to be necessary or convenient in order to facilitate the development of community choice aggregation programs, to foster fair competition, and to protect against cross-subsidization paid by ratepayers.
It is the intent of the Legislature that the rules include, in whole or in part, the rules approved by the commission in Decision 97-12-088 and Decision 08-06-016.
This paragraph does not limit the authority of the commission to adopt rules that it determines are necessary or convenient in addition to those adopted in Decision 97-12-088 and Decision 08-06-016 or to modify any rule adopted in those decisions.
Provide for any other matter that the commission determines to be necessary or advisable to protect a ratepayer’s right to be free from forced speech or to implement that portion of the federal Public Utility Regulatory Policies Act of 1978 that establishes the federal standard that no electric utility may recover from any person other than the shareholders or other owners of the utility, any direct or indirect expenditure by the electric utility for promotional or political advertising (16 U.S.C. Sec. 2623(b)(5)).
The commission shall ensure that the code of conduct, associated rules, and enforcement procedures are implemented by no later than January 1, 2013.
This section does not limit the authority of the commission to require that any marketing against a community choice aggregation plan shall be conducted by an affiliate of the electrical corporation, or to require that marketing against a community choice aggregator not be conducted by a marketing division of the electrical corporation, subject to affiliate transaction rules to be developed by the commission.
The commission shall require every electrical, gas, and telephone corporation to prepare and issue to every employee who, in the course of his or her employment, has occasion to enter the premises of customers or subscribers of the corporation an identification card in a distinctive format having a photograph of the employee. The corporation shall require every employee to present the card upon requesting entry into any building or structure on the premises of a customer or subscriber.
Whenever a business transaction of an electrical, gas, water corporation with 10,000 or more service connections, or telephone corporation is such that a personal appearance by a person is required by the corporation and the person is unable to appear at the corporation’s place of business during the corporation’s usual business hours, then the corporation shall provide a reasonable and convenient alternative to the person such as an appointment outside the corporation’s usual business hours or allowing the person to conduct the transaction by telephone, or mail, or both.
The Legislature hereby finds and declares that the policies for telecommunications in California are as follows:
To continue our universal service commitment by assuring the continued affordability and widespread availability of high-quality telecommunications services to all Californians.
To focus efforts on providing educational institutions, health care institutions, community-based organizations, and governmental institutions with access to advanced telecommunications services in recognition of their economic and societal impact.
To encourage the development and deployment of new technologies and the equitable provision of services in a way that efficiently meets consumer need and encourages the ubiquitous availability of a wide choice of state-of-the-art services.
To assist in bridging the “digital divide” by encouraging expanded access to state-of-the-art technologies for rural, inner-city, low-income, and disabled Californians.
To promote economic growth, job creation, and the substantial social benefits that will result from the rapid implementation of advanced information and communications technologies by adequate long-term investment in the necessary infrastructure.
To promote lower prices, broader consumer choice, and avoidance of anticompetitive conduct.
To remove the barriers to open and competitive markets and promote fair product and price competition in a way that encourages greater efficiency, lower prices, and more consumer choice.
To encourage fair treatment of consumers through provision of sufficient information for making informed choices, establishment of reasonable service quality standards, and establishment of processes for equitable resolution of billing and service problems.
The commission shall authorize fully open competition for intrastate interexchange telecommunications service, otherwise known as intrastate interLATA, or intrastate service between local access and transport areas, in California if federal legislation or court action amends the modification of final judgment entered by the United States District Court for the District of Columbia in United States v. Western Electric, Civil Action No. 82-0192, to allow open competition in that service.
If neither federal law nor court action has authorized full intrastate interexchange competition, the commission shall order the opening of all intrastate interexchange telecommunications markets to full competition, and the commission shall order, no later than October 1, 1995, all telephone corporations subject to the restrictions in the modification of final judgment to offer full intrastate interexchange service, and to seek a waiver of the interexchange telecommunications service restriction from the federal court overseeing the modification of final judgment. The service may be offered through resale and through facilities owned by the telephone corporations.
If the federal district court denies the waiver request, and an appeal is taken and the federal Court of Appeals affirms the denial and refuses to remand the waiver request to the federal district court for further review, and review is sought in the United States Supreme Court and that court refuses to review or reviews and affirms the lower court decisions denying the waiver, and the commission determines that all reasonable legal recourse has been exhausted by the telephone corporation, the commission shall rescind the order.
No order shall be implemented, nor services marketed by the telephone corporations until a waiver is granted or until federal legislation or court action amends the modification of final judgment to allow open competition in intrastate interexchange telecommunications service.
No commission order authorizing or directing competition in intrastate interexchange telecommunications shall be implemented until the commission has done all of the following, pursuant to the public hearing process:
Determined that there is no substantial possibility of harm to the competitive intrastate interexchange telecommunications markets.
The opening of intrastate interexchange telecommunications markets to competition pursuant to this section shall not precede, but may be coincident with, the opening of competition within the local exchange markets, as expressly authorized by the commission, subject to subdivision (c).
No part of this section shall be construed as constituting a state action within the meaning of Parker v. Brown, 317 U.S. 341.
No part of this section shall be construed to preempt application of the unfair practices or antitrust laws of this state.
It is the intent of the Legislature that all telecommunications markets subject to commission jurisdiction be opened to competition not later than January 1, 1997. The commission shall take steps to ensure that competition in telecommunications markets is fair and that the state’s universal service policy is observed.
To the extent possible, competition in intraexchange telecommunications markets shall be coincident with competition in video markets.
The commission shall expedite its open network architecture and network development, interconnection, universal service, and other related dockets so that whatever additional rules and regulations that may be necessary to achieve fair local exchange competition shall be in place no later than January 1, 1997.
If any local exchange telephone company obtains the right to offer cable television or video dialtone service within its service territory from a regulatory body or court of competent jurisdiction, any cable television corporation or its affiliates may immediately have the right to enter into the intraexchange market within the service territory of that local exchange carrier by filing for approval of a certificate of public convenience and necessity, if necessary, which shall be expeditiously reviewed by the commission.
If the local exchange corporation is subject to the commission’s standards for the interconnection of networks, network unbundling, and service quality, the cable television corporation or its affiliates may be subject to the commission’s standards for the interconnection of networks, network unbundling, and service quality, for that portion of their network dedicated to intraexchange telecommunications service. In addition, all corporations offering intraexchange telecommunications service shall be subject to the commission’s consumer protection regulations.
Not later than January 1, 2000, the commission shall commence a proceeding to consider whether to establish a new regulatory framework that does all of the following:
Ensures that the public has universally available access to basic local exchange service.
Applies appropriate rules to all telecommunications service providers.
Encourages the provision of advanced, high-speed digital telecommunications services to the public.
The commission shall convene, and continue until August 26, 2030, an independent peer review panel to conduct an independent review of enhanced seismic studies and surveys of the Diablo Canyon Units 1 and 2 powerplant, including the surrounding areas of the facility and areas of nuclear waste storage.
The independent peer review panel shall contract with the Energy Commission, the California Geological Survey of the Department of Conservation, the California Coastal Commission, the Alfred E. Alquist Seismic Safety Commission, the Office of Emergency Services, and the County of San Luis Obispo to participate on the panel and provide expertise.
The independent peer review panel shall review the seismic studies and hold public meetings.
The commission shall make reports by the independent peer review panel publicly available on the internet website maintained by the commission.
The Legislature finds and declares that in commission Decision 88-12-083 (December 19, 1988) Re Pacific Gas and Electric Company (30 CPUC.2d 189), the commission created the Independent Safety Committee for Diablo Canyon to make recommendations appropriate to enhance the safety of the operation of the Diablo Canyon powerplant.
The Independent Safety Committee for Diablo Canyon shall continue to have the rights established pursuant to commission Decision 88-12-083, as amended by Decisions 07-01-028 and 21-09-003, to conduct annual examinations of the Diablo Canyon powerplant and make additional site visits. The committee shall cease operations no sooner than when the Diablo Canyon powerplant has ceased operations and all spent nuclear fuel has been moved to dry storage at the Diablo Canyon Independent Spent Fuel Storage Installation.
The Independent Safety Committee for Diablo Canyon shall be composed of three experts, one each shall be appointed by the Governor, the Attorney General, and the Chair of the Energy Commission, from a list of candidates nominated by the President of the commission that shall include not more than three qualified candidates as alternatives to the reappointment of the appointing authority’s designated committee member whose term is expiring, and which shall also include the incumbent committee member if the member consents to being an additional candidate. The incumbent as of August 1, 2022, may continue to serve their current term until it expires.
The commission shall ensure the funding of the Independent Safety Committee for Diablo Canyon to attract qualified experts during the period of extended Diablo Canyon powerplant operations, as defined by Section 712.8.
In addition to the duties and responsibilities set forth in commission decisions, the Independent Safety Committee for Diablo Canyon shall do both of the following:
Consult with and incorporate into its assessments and recommendations the independent peer review panel established pursuant to Section 712.
Transmit annually its findings and recommendations for improved safety, and any response required pursuant to subdivision (f), to the Legislature, the Governor, the commission, the Energy Commission, the United States Nuclear Regulatory Commission, and the company licensed to operate the Diablo Canyon Units 1 and 2 powerplant. The report transmitted to the Legislature shall be in accordance with Section 9795 of the Government Code.
The company licensed to operate the Diablo Canyon Units 1 and 2 powerplant shall annually respond to the annual report provided for in paragraph (2) of subdivision (e) and distribute its response to the governmental entities specified in that paragraph.
The commission shall cause an assessment to be completed by no later than July 1, 2018, of the adverse and beneficial economic impacts, and the net economic effects, for the County of San Luis Obispo and the surrounding regions, that could occur if the Diablo Canyon Units 1 and 2 powerplant were to temporarily or permanently shut down before the powerplant’s current operating licenses from the Nuclear Regulatory Commission expire or when the Pacific Gas and Electric Company closes the powerplant upon the expiration of its current licenses. The assessment shall include a review, as described in paragraph (4) of subdivision (b), of potential actions for the state and local jurisdictions to consider in order to mitigate the adverse economic impact of a shutdown.
The assessment shall be conducted by an independent third party, selected in accordance with paragraph (1) of subdivision (c).
The assessment shall consist of, but not be limited to, all of the following:
Estimates of any changes in local tax revenues, changes in workforce populations, changes in indirect or induced economies, and potential impacts to ratepayers from a shutdown.
A review of the economic impacts that affected the region surrounding the San Onofre Nuclear Generating Station after it was decommissioned by the Southern California Edison Company and of the relevant decommissioning plans of the San Onofre Nuclear Generating Station.
A review of regions in the United States similar to the County of San Luis Obispo and the surrounding regions that have experienced the decommissioning of a nuclear powerplant and of the resulting economic impacts of the decommissioning on those regions.
Identification of any contingency plans that could mitigate the adverse economic impact of a shutdown to state and local jurisdictions, the local workforce, and entities receiving enhanced tax revenue.
The commission shall make the assessment publicly available on its Internet Web site, distribute copies to relevant state and local jurisdictions, and convene a public forum in the County of San Luis Obispo on the findings and recommendations of the assessment.
The commission shall approve both of the following:
The full funding for the community impact mitigation settlement proposed in Application 16-08-006.
The full funding for the employee retention program proposed in Application 16-08-006.
The commission shall ensure that integrated resource plans are designed to avoid any increase in emissions of greenhouse gases as a result of the retirement of the Diablo Canyon Units 1 and 2 powerplant.
The commission shall establish an expedited advice letter process for the approval and implementation pursuant to subdivision (a) of the community impact mitigation settlement and the employee retention program.
For purposes of this section, the following definitions apply:
“Current expiration dates” has the same meaning as defined in Section 25548.1 of the Public Resources Code.
“Diablo Canyon powerplant operations” has the same meaning as defined in Section 25548.1 of the Public Resources Code.
“Load-serving entity” has the same meaning as defined in Section 380.
“Operator” has the same meaning as defined in Section 25548.1 of the Public Resources Code.
Ordering paragraphs (1) and (14) of commission Decision 18-01-022 (January 11, 2018) Decision Approving Retirement of Diablo Canyon Nuclear Power Plant, are hereby invalidated.
The commission shall reopen commission Application 16-08-006 and take other actions as are necessary to implement this section.
Notwithstanding any other law, within 120 days of September 2, 2022, the commission shall direct and authorize the operator of the Diablo Canyon Units 1 and 2 to take all actions that would be necessary to operate the powerplant beyond the current expiration dates, so as to preserve the option of extended operations, until the following retirement dates, conditional upon continued authorization to operate by the United States Nuclear Regulatory Commission:
For Unit 1, October 31, 2029.
For Unit 2, October 31, 2030.
If the loan provided for by Chapter 6.3 (commencing with Section 25548) of Division 15 of the Public Resources Code is terminated under that chapter, the commission shall modify its order under this paragraph and direct an earlier retirement date.
Actions taken by the operator pursuant to the commission’s actions under this paragraph, including in preparation for extended operations, shall not be funded by ratepayers of any load-serving entities, but may be funded by the loan provided for by Chapter 6.3 (commencing with Section 25548) of Division 15 of the Public Resources Code or other nonratepayer funds available to the operator. The commission shall not allow the recovery from ratepayers of costs incurred by the operator to prepare for, seek, or receive any extended license to operate by the United States Nuclear Regulatory Commission.
No later than December 31, 2023, and notwithstanding the 180-day time limitation in subdivision (a) of Section 25548.2 of the Public Resources Code, the commission shall direct and authorize extended operations at the Diablo Canyon powerplant until the new retirement dates specified in subparagraph (A) of paragraph (1).
The commission shall review the reports and recommendations of the Independent Safety Committee for Diablo Canyon described in Section 712.1. If the Independent Safety Committee for Diablo Canyon’s reports or recommendations cause the commission to determine, in its discretion, that the costs of any upgrades necessary to address seismic safety or issues of deferred maintenance that may have arisen due to the expectation of the plant closing sooner are too high to justify incurring, or if the United States Nuclear Regulatory Commission’s conditions of license renewal require expenditures that are too high to justify incurring, the commission may issue an order that reestablishes the current expiration dates as the retirement date, or that establishes new retirement dates that are earlier than provided in subparagraph (A) of paragraph (1), to the extent allowable under federal law, and shall provide sufficient time for orderly shutdown and authorize recovery of any outstanding uncollected costs and fees.
If the loan provided for by Chapter 6.3 (commencing with Section 25548) of Division 15 of the Public Resources Code is terminated under that chapter, the commission may issue an order that reestablishes the current expiration dates as the retirement date, or that establishes new retirement dates that are earlier than provided in subparagraph (A) of paragraph (1), and shall provide sufficient time for orderly shutdown and authorize recovery of any outstanding uncollected costs and fees.
If the commission determines that new renewable energy and zero-carbon resources that are adequate to substitute for the Diablo Canyon powerplant and that meet the state’s planning standards for energy reliability have already been constructed and interconnected by the time of its decision, the commission may issue an order that reestablishes the current expiration dates as the retirement date, or that establishes new retirement dates that are earlier than provided in subparagraph (A) of paragraph (1), and shall provide sufficient time for orderly shutdown and authorize recovery of any outstanding uncollected costs and fees.
Any retirement date established under this paragraph shall be conditioned upon continued authorization to operate by the United States Nuclear Regulatory Commission. If the United States Nuclear Regulatory Commission does not extend the current expiration dates or renews the licenses for Diablo Canyon Units 1 or 2 for a period shorter than the extended operations authorized by the commission, the commission shall modify any orders issued under this paragraph to direct a retirement date that is the same as the United States Nuclear Regulatory Commission license expiration date.
The commission shall do all things necessary and appropriate to implement this section, including, but not limited to, allocating financial responsibility for the extended operations of the Diablo Canyon powerplant to customers of all load-serving entities and ensuring completion of funding of the community impacts mitigation settlement described in Section 712.7. The commission shall not require any funds already disbursed or committed under the community impacts mitigation settlement described in Section 712.7 to be returned because of extended operations of the Diablo Canyon powerplant.
Except as authorized by this section, customers of load-serving entities shall have no other financial responsibility for the costs of the extended operations of the Diablo Canyon powerplant. In no event shall load-serving entities other than the operator and their customers have any liability for the operations of the Diablo Canyon powerplant.
Consistent with Section 25548.4 of the Public Resources Code, the commission shall collaborate with the Department of Water Resources to oversee the operator’s actions that are funded by the loan provided for by Chapter 6.3 (commencing with Section 25548) of Division 15 of the Public Resources Code.
The commission shall not increase cost recovery from ratepayers for operations and maintenance expenses incurred by the operator during the period from August 1, 2022, to November 2, 2024, for Diablo Canyon Unit 1 and from August 1, 2022, to August 26, 2025, for Diablo Canyon Unit 2, above the amounts approved in the most recent general rate case for the operator pursuant to commission proceeding A.21-06-021 (June 30, 2021) Application of Pacific Gas and Electric Company for Authority, Among Other Things, to Increase Rates and Charges for Electric and Gas Service Effective on January 1, 2023.
The commission shall order the operator to track all costs associated with continued and extended operations of Diablo Canyon Units 1 and 2. The commission shall authorize the operator to establish accounts as necessary to track all costs incurred under paragraph (1) of subdivision (c), all costs incurred under the loan provided for by Chapter 6.3 (commencing with Section 25548) of Division 15 of the Public Resources Code, all costs to be borne only by the operator’s ratepayers, all costs to be borne by ratepayers of all load-serving entities, consistent with this section, and any other costs as determined by the commission. Among these accounts shall be a Diablo Canyon Extended Operations liquidated damages balancing account, described in subdivisions (g) and (i).
Notwithstanding any approval of extended operations, the commission shall continue to authorize the operator to recover in rates all of the reasonable costs incurred to prepare for the retirement of Diablo Canyon Units 1 and 2, including any reasonable additional costs associated with decommissioning planning resulting from the license renewal applications or license renewals. The reasonable costs incurred to prepare for the retirement of Diablo Canyon Power Plant Units 1 and 2 shall be recovered on a fully nonbypassable basis from customers of all load-serving entities subject to the commission’s jurisdiction in the operator’s service territory, as determined by the commission, except that the reasonable additional costs associated with decommissioning planning resulting from the license renewal applications or license renewals shall be recovered on a fully nonbypassable basis from customers of all load-serving entities subject to the commission’s jurisdiction in the state.
The commission shall continue to fund the employee retention program approved in Decision 18-11-024 (December 2, 2018) Decision Implementing Senate Bill 1090 and Modifying Decision 18-01-022, as modified to incorporate 2024, 2025, and additional years of extended operations, on an ongoing basis until the end of operations of both units with program costs tracked under subdivision (e) and fully recovered in rates. Any additional funding for the employee retention program beyond what was already approved in commission Decision 18-11-024 shall be submitted by the operator in an application for review by the commission.
The commission shall determine the amount or allocation that the customers of all load-serving entities subject to the commission’s jurisdiction shall contribute towards the reasonable additional costs of decommissioning planning resulting from the license renewal applications or license renewals and shall authorize the operator to recover in rates those costs through a nonbypassable charge applicable to the customers of all load-serving entities subject to the commission’s jurisdiction in the state as set forth in paragraph (1) of subdivision (l).
The commission shall authorize the operator to recover in rates all of the reasonable costs incurred to prepare for, respond to, provide information to, or otherwise participate in or engage the independent peer review panel under Section 712.
In lieu of a rate-based return on investment and in acknowledgment of the greater risk of outages in an older plant that the operator could be held liable for, the commission shall authorize the operator to recover in rates a volumetric payment equal to six dollars and fifty cents ($6.50), in 2022 dollars, for each megawatthour generated by the Diablo Canyon powerplant during the period of extended operations beyond the current expiration dates, to be borne by customers of all load-serving entities, and an additional volumetric payment equal to six dollars and fifty cents ($6.50), in 2022 dollars, to be borne by customers in the service territory of the operator. The amount of the operating risk payment shall be adjusted annually by the commission using commission-approved escalation methodologies and adjustment factors.
In lieu of a rate-based return on investment and in acknowledgment of the greater risk of outages in an older plant that the operator could be held liable for, the commission shall authorize the operator to recover in rates a fixed payment of fifty million dollars ($50,000,000), in 2022 dollars, for each unit for each year of extended operations, subject to adjustment in subparagraphs (B) to (D), inclusive. The amount of the fixed payment shall be adjusted annually by the commission using commission-approved escalation methodologies and adjustment factors.
In the first year of extended operations for each unit, the operator shall continue to receive the full fixed payment during periods in which a unit is out of service due to an unplanned outage for nine months or less, and shall receive 50 percent of the payment for months in excess of nine months that a unit is down.
In the second year of extended operations, the operator shall continue to receive the fixed payment during periods in which a unit is out of service due to an unplanned outage for eight months or less, and shall receive 50 percent of the payment for months in excess of eight months that a unit is down.
In each subsequent year of extended operations, the period in which the full fixed payment is received during periods when a unit is out of service due to an unplanned outage shall decline by one additional month.
The commission shall authorize and fund as part of the charge under paragraph (1) of subdivision (l), the Diablo Canyon Extended Operations liquidated damages balancing account in the amount of twelve million five hundred thousand dollars ($12,500,000) each month for each unit until the liquidated damages balancing account has a balance of three hundred million dollars ($300,000,000).
The commission shall authorize the operator to recover all reasonable costs and expenses necessary to operate Diablo Canyon Units 1 and 2 beyond the current expiration dates, including those in subdivisions (f) and (g), net of market revenues for those operations and any production tax credits of the operator, on a forecast basis in a new proceeding structured similarly to its annual Energy Resource Recovery Account forecast proceeding with a subsequent true-up to actual costs and market revenues for the prior calendar year via an expedited Tier 3 advice letter process, provided that there shall be no further review of the reasonableness of costs incurred if actual costs are below 115 percent of the forecasted costs. All costs shall be recovered as an operating expense and shall not be eligible for inclusion in the operator’s rate base.
As the result of any significant one-time capital expenditures during the extended operation period, the commission may authorize, and the operator may propose, cost recovery of these expenditures as operating expenses amortized over more than one year for the purpose of reducing rate volatility, at an amortization interest rate determined by the commission. The commission shall allow cost recovery if the costs and expenses are just and reasonable. Those costs and expenses are just and reasonable if the operator’s conduct is consistent with the actions that a reasonable utility would have undertaken in good faith under similar circumstances, at the relevant point in time and with information that the operator should have known at the relevant point in time.
If, as a result of the annual true-up for extended operations in paragraph (1), the commission determines that market revenues for the prior year exceeded the annual costs and expenses, including those in subdivisions (f) and (g), the commission shall direct that any available surplus revenues in an account created under subdivision (e) be credited solely to customers in the operator’s service territory. For customers outside the operator’s service territory, market revenues may be credited up to, but not to exceed, their respective annual costs and expenses. If excess funds remain in an account created under subdivision (e) as a result of market revenues exceeding costs and expenses in the final year of the extended operating period, after truing up the final operating year’s market revenues against costs and expenses, the remaining funds shall be the sole source of loan repayment per the requirements provided under Chapter 6.3 (commencing with Section 25548) of Division 15 of the Public Resources Code, except that any federal funds received as described in paragraph (1) of subdivision (c) of Section 25548.3 of the Public Resources Code shall also be used to repay the loan. Ratepayer funds shall not otherwise be used in any manner to repay the loan provided for under Chapter 6.3 (commencing with Section 25548) of Division 15 of the Public Resources Code.
If the commission finds that the operator is requesting recovery of costs that were previously authorized by the commission or other state or federal agency or paid to the operator for cost recovery, the commission may fine the operator an amount up to three times the amount of the penalty provided in Section 2107 for each violation.
If at any point during the license renewal process or extended operations period the operator believes that, as a result of an unplanned outage, an emergent operating risk, or a new compliance requirement, the cost of performing upgrades needed to continue operations of one or both units exceed the benefits to ratepayers of the continued operation of doing so, the operator shall promptly notify the commission. The commission shall promptly review and determine whether expending funds to continue operations is reasonable, will remain beneficial to ratepayers, and is in the public interest or direct the operator to cease operations. The operator shall take all actions necessary to safely operate or maintain the Diablo Canyon powerplant pending the commission determination.
Any costs the commission authorizes the operator to recover in rates under this section shall be recovered on a fully nonbypassable basis from customers of all load-serving entities subject to the commissions’s jurisdiction, as determined by the commission, except as otherwise provided in this section. The recovery of these nonbypassable costs by the load-serving entities shall be based on each customer’s gross consumption of electricity regardless of a customer’s net metering status or purchase of electric energy and service from an electric service provider, community choice aggregator, or other third-party source of electric energy or electricity service.
The commission shall establish mechanisms, including authorizing balancing and memorandum accounts and, as needed, agreements with, or orders with respect to, electrical corporations, community choice aggregators, and electric service providers, to ensure that the revenues received to pay a charge or cost payable pursuant to this section are recovered in rates from those entities and promptly remitted to the entity entitled to those revenues.
This section does not alter the recovery of costs, including those previously approved by the commission, to operate Diablo Canyon Units 1 and 2 until the current expiration dates.
The commission shall halt disbursements from the Diablo Canyon Nuclear Decommissioning Non-Qualified Trust, excluding refunds to ratepayers.
The commission, in consultation with the relevant federal and state agencies and appropriate California Native American tribes, shall, in a new or existing proceeding, determine the disposition of the Diablo Canyon powerplant real property and its surrounding real properties owned by the applicable public utility or any legally related, affiliated, or associated companies, in a manner that best serves the interests of the local community, ratepayers, California Native America tribes, and the state. It is the intent of the Legislature that the existing efforts to transfer lands owned by the operator and Eureka Energy shall not be impeded by the extension of the Diablo Canyon powerplant.
Except as otherwise provided in this section, this section does not alter or limit any proceeding of the commission relating to the decommissioning of the Diablo Canyon powerplant.
The Legislature finds and declares that the purpose of the extension of the Diablo Canyon powerplant operations is to protect the state against significant uncertainty in future demand resulting from the state’s greenhouse gas reduction efforts involving electrification of transportation and building energy end uses and regional climate-related weather phenomenon, and to address the risk that currently ordered procurement will be insufficient to meet this supply or that there may be delays in bringing the ordered resources online on schedule. Consequently, the continued operation of Diablo Canyon Units 1 and 2 beyond their current expiration dates shall not be factored into the analyses used by the commission or by load-serving entities not subject to the commission’s jurisdiction when determining future generation and transmission needs to ensure electrical grid reliability and to meet the state’s greenhouse gas emissions reduction goals. To the extent the commission decides to allocate any benefits or attributes from extended operations of the Diablo Canyon powerplant, the commission may consider the higher cost to customers in the operator’s service area.
Any sale, mortgage, transfer of operational control, or any other encumbrance of disposition of the Diablo Canyon powerplant shall continue to be subject to Article 6 (commencing with Section 851).
The operator shall submit to the commission for its review, on an annual basis the amount of compensation earned under paragraph (5) of subdivision (f), how it was spent, and a plan for prioritizing the uses of such compensation the next year. Such compensation shall not be paid out to shareholders. Such compensation, to the extent it is not needed for Diablo Canyon, shall be spent to accelerate, or increase spending on, the following critical public purpose priorities:
Accelerating customer and generator interconnections.
Accelerating actions needed to bring renewable and zero-carbon energy online and modernize the electrical grid.
Accelerating building decarbonization.
Workforce and customer safety.
Communications and education.
Increasing resiliency and reducing operational and system risk.
The operator shall not earn a rate of return for any of the expenditures described in paragraph (1) so that no profit shall be realized by the operator’s shareholders. Neither the operator nor any of its affiliates or holding company may increase existing public earning per share guidance as a result of compensation provided under this section. The commission shall ensure no double recovery in rates.
The commission shall verify at the conclusion of extended operations that the operator’s sole compensation during the period of extended operations is limited to and in accordance with paragraphs (5) and (6) of subdivision (f) and shall be in lieu of a rate-based return on investment in the Diablo Canyon powerplant. Any excess funds remaining in an account created under subdivision (e) as a result of market revenues exceeding costs and expenses across the extended operating period, after truing up the final operating year’s market revenues against costs and expenses, following loan repayment under paragraph (3) of subdivision (h), shall not be paid out to shareholders. Instead, such excess funds shall be returned in full to customers in a manner to be determined by the commission, except that any funds remaining in the Diablo Canyon Extended Operations liquidated damages balancing account specified in subdivisions (g) and (i), shall be returned to customers in the operator’s service territory in a manner to be determined by the commission.
The efforts to transfer lands owned by the operator and Eureka Energy, including North Ranch, Parcel P, South Ranch, and Wild Cherry Canyon, shall not be impeded by the extension of the operation of the Diablo Canyon powerplant.
In the event of a final determination by the United States Department of Energy that the Diablo Canyon powerplant is not eligible for the Civil Nuclear Credit Program established by Section 18753 of Title 42 of the United States Code, subdivisions (d) to (m), inclusive, (p), (q), (s), and (t) shall cease to be operative, and the commission shall instead undertake ordinary ratemaking with respect to the Diablo Canyon powerplant.
Golden State Energy may commence an eminent domain action to acquire all or substantially all of Pacific Gas and Electric Company only if the commission determines that Pacific Gas and Electric Company’s certificate of public convenience and necessity for the provision of electrical or gas service should be revoked pursuant to any process or procedures adopted by the commission in its Decision 20-05-053. Golden State Energy may exclude from the acquisition only property not directly related to providing electrical or gas service.
Golden State Energy may take possession of Pacific Gas and Electric Company property upon deposit in court, and prompt release, of an amount determined by the court to be the probable amount of just compensation.
For purposes of this section, the following definitions apply:
“Decision 20-05-053” means Decision 20-05-053 (May 28, 2019) Decision Approving Reorganization Plan in Investigation 19-09-016 (September 26, 2019) Order Instituting Investigation on the Commission’s Own Motion to Consider the Ratemaking and Other Implications of a Proposed Plan for Resolution of Voluntary Case filed by Pacific Gas and Electric Company Pursuant to Chapter 11 of the Bankruptcy Code, in the United States Bankruptcy Court, Northern District of California, San Francisco Division, In re Pacific Gas and Electric Corporation and Pacific Gas and Electric Company, Case No. 19-30088.
“Pacific Gas and Electric Company” means Pacific Gas and Electric Company, PG&E Corporation, any subsidiary or affiliate of the foregoing holding any assets related to the provision of electrical or gas service within Pacific Gas and Electric Company‘s service territory, and any successor to any of the foregoing.
“Property” has the same meaning as defined in Section 1235.170 of the Code of Civil Procedure, including any franchise rights and stock.
If an incumbent local exchange carrier files a forbearance petition with the Federal Communications Commission pursuant to Section 10 of the federal Communications Act of 1934 (47 U.S.C. Sec. 160), requesting that the Federal Communications Commission forbear from enforcing that carrier’s duty to provide to any requesting telecommunications carrier, nondiscriminatory access to network elements on an unbundled basis at any technically feasible point on rates, terms, and conditions that are just, reasonable, and nondiscriminatory (47 U.S.C. Sec. 251(c)(3) and Sec. 271 (c)(2)(B)(ii)), within any metropolitan statistical area located in the state, the commission shall participate in that forbearance proceeding by filing comments on the petition, providing data on competition in the metropolitan statistical area that is the subject of the petition, and taking any other action that advances the state’s policies promoting competition in telecommunications markets.
In order to be prepared to timely comply with subdivision (a), the commission shall develop a sample data request for collecting data on competition in any California metropolitan statistical area. The data shall include, but not be limited to, separate data on competitive options for residential, business, and wholesale services.
All providers of voice communications services, including, but not limited to, local exchange carriers, interexchange carriers, mobile telephony service providers, and providers of facilities-based interconnected Voice over Internet Protocol (VoIP) service, shall provide all data and other information relevant to the forbearance petition requested by the commission pursuant to this section.
The commission shall require an electrical or gas corporation to do all of the following:
Develop a program no later than January 1, 2017, within the electrical or gas corporation’s demand-side management programs authorized by the commission, to provide incentives to a residential or small or medium business customer to acquire energy management technology for use in the customer’s home or place of business. The electrical or gas corporation may allow third parties or local governments to apply for incentives on behalf of customers. The electrical or gas corporation shall work with third parties, local governments, and other interested parties in developing the program. The electrical or gas corporation shall establish incentive amounts based on savings estimation and baseline policies adopted by the commission.
Develop a plan by September 30, 2016, to educate residential customers and small and medium business customers about the incentive program developed pursuant to paragraph (1). The commission may require that the plan be integrated into, or coordinated with, any education campaign required by the commission.
Annually report to the commission on actual customer savings resulting from the incentive program established pursuant to this section. The commission shall evaluate all electrical or gas corporation energy savings claims achieved pursuant to the incentive program in a manner consistent with commission-adopted evaluation protocols and determine if the program shall continue or be modified.
For purposes of this section, “energy management technology” may include a product, service, or software that allows a customer to better understand and manage electricity or gas use in the customer’s home or place of business.
Nothing in this section shall be construed to amend or limit the ability of a community choice aggregator to apply to administer an energy efficiency or conservation program or a demand-side management program as set forth in Section 381.1.
The commission shall develop policies, rules, or regulations with a goal of reducing, by January 1, 2024, the statewide level of gas and electric service disconnections for nonpayment by residential customers, including policies, rules, or regulations specific to the four gas and electrical corporations that have the greatest number of customers. The commission shall convene stakeholders, including, but not limited to, public health officials, consumer advocates, and organizations representing low-income communities, to assist with the development of the policies, rules, or regulations.
In each gas and electrical corporation general rate case, the commission shall do both of the following:
Designate the impact of any proposed increase in rates on disconnections for nonpayment as an issue in the scope of the proceeding.
Conduct an assessment of and properly identify the impact of any proposed increase in rates on disconnections for nonpayment, which shall be included in the record of the proceeding.
The commission shall adopt residential utility disconnections for nonpayment as a metric and incorporate the metric into each gas and electrical corporation general rate case.
For purposes of this section, terms used in this section shall have the same meaning as those terms are defined in Section 3280.
On or before April 1, 2026, the administrator, in consultation with the commission, the Office of Energy Infrastructure Safety, the Department of Insurance, the Office of Emergency Services, and the Department of Forestry and Fire Protection, and with feedback solicited from stakeholders, including, but not limited to, ratepayer advocates, insurance policyholder advocates, electrical corporations, insurance companies, and claimant attorneys, shall prepare and submit to the Legislature, and to the Governor, a report that evaluates and sets forth recommendations on new models or approaches that mitigate damage, accelerate recovery, and responsibly and equitably allocate the burdens from natural catastrophes, including catastrophic wildfires, earthquakes, and other natural disasters, across stakeholders, including insurers, communities, homeowners, landowners, governments, electrical corporations, and local publicly owned electric utilities, to complement or replace the fund.
The report shall include specific recommendations, including, but not limited to, on all of the following:
Accessibility and affordability of property insurance in California in light of the accelerating costs of climate change-induced and other natural catastrophes.
An evaluation of alternative structures to socialize risk of damage from natural catastrophes, including catastrophic wildfires, that most efficiently and expeditiously compensate those harmed while maintaining accessibility to property insurance and access to safe, affordable, and reliable energy for Californians.
Additional mitigation measures and technology solutions to reduce the risk of ignition of wildfires and limit the spread of and damage from wildfires.
Financing, insurance, and other mechanisms to expedite recovery for communities impacted by natural catastrophes, including wildfires, and to expedite compensation for property loss.
Additional measures to benefit ratepayers through reducing costs caused by fiscal uncertainty while holding electrical corporations accountable for improving safety and reducing the risk of catastrophic wildfires.
Options for enactment of a streamlined, low-cost mechanism to provide injured parties full compensation for damages resulting from wildfires.
An analysis of the potential benefits and potential negative impacts on homeowners related to reasonable limitations on changes to recoveries in wildfire litigation arising from ignitions caused by electrical or gas utility infrastructure, including, but not limited to, restrictions on the recovery of attorney’s fees, limitations on economic and noneconomic damages, including claims by insurers, limitations on public entity claims, limitations on claims by those outside the fire perimeter, and aggregate limitations on liability per event.
Options for enactment of programs to reduce the risk of wildfires spreading and becoming high-severity catastrophes, including improved state and local catastrophic event response capability, home fire risk reduction standards, vegetation management practices, and communitywide wildfire hardening requirements.
Options for reducing the economic damage resulting from wildfires and potentially other catastrophic natural disasters, including minimum insurance requirements, mechanisms to ensure insurance rates appropriately account for home and community hardening measures taken, special assessments to support infrastructure investments and emergency response, and improved land use planning.
Options for new models to complement or replace the fund, such as state-supported property insurance, or reinsurance, or both insurance and reinsurance, for wildfires and potential catastrophic natural disasters; a mutual wildfire insurance fund; a publicly supported financial safety net to enhance long-term resilience and utility and insurance rate affordability; and improvements to the fund to enhance its durability.
The administrator may retain consultants, academic experts, and other professionals as may be necessary for the efficient preparation of the report pursuant to this section and may compensate those retained consultants, academic experts, and other professionals using the Wildfire Fund assets or account assets.
The report to be submitted pursuant to this section shall be submitted in compliance with Section 9795 of the Government Code.
Pursuant to Section 10231.5 of the Government Code, this section is repealed on January 1, 2030.
ARTICLE 2. Rates [727. - 758.]
It is the policy of the state that the use of all waterways, ports, and harbors of this state shall be encouraged, and to that end the commission is directed in the establishment of rates for water carriers applying to business moving between points within this state to fix those rates at such a differential under the rates of competing land carriers that the water carriers shall be able fairly to compete for such business. In fixing the rates there shall be taken into consideration quality and regularity of service and class and speed of vessels.
In establishing rates for water service, the commission shall consider, and may establish, separate charges for costs associated with customer service, facilities, variable operating costs, including fixed and variable costs associated with supplying the water, or other components of the water service provided to water users.
The commission shall consider, and may authorize, a water corporation to assess a fee for future water service, or a reservation charge for future water service, for persons or entities occupying or owning property within the service territory of the water corporation.
The commission shall consider, and may authorize, a water corporation to establish a balancing account, rate stabilization fund, or other contingency fund, the purpose of which shall be the long-term stabilization of water rates.
The commission shall consider, and may authorize, a water corporation to establish programs, including rate designs, for achieving conservation of water and recovering the cost of these programs through the rates.
Upon application by a water corporation with more than 10,000 service connections, the commission shall consider, and may authorize, the implementation of a mechanism that separates the water corporation’s revenues and its water sales, commonly referred to as a “decoupling mechanism.”
An authorized decoupling mechanism shall be designed to ensure that the differences between actual and authorized water sales do not result in the overrecovery or underrecovery of the water corporation’s authorized water sales revenue.
An authorized decoupling mechanism shall not enable the water corporation to earn a revenue windfall by encouraging higher sales.
The water corporation may only submit an application to the commission pursuant to this paragraph as part of its triennial general rate case application described in Section 455.2, unless the commission and the water corporation mutually agree for the application to be otherwise submitted.
In establishing rates for recovery of the costs of used and useful water plant, the commission may use a capital structure and payback methodology that maintains the reliability of water service, minimizes the long-term cost to ratepayers, provides equity between present and future ratepayers, and affords the utility an opportunity to earn a reasonable return on its used and useful investment, attract capital for investment on reasonable terms, and ensure the financial integrity of the utility.
Whenever the commission, after a hearing, finds that the rates or classifications, demanded, observed, charged, or collected by any public utility for or in connection with any service, product, or commodity, or the rules, practices, or contracts affecting such rates or classifications are insufficient, unlawful, unjust, unreasonable, discriminatory, or preferential, the commission shall determine and fix, by order, the just, reasonable, or sufficient rates, classifications, rules, practices, or contracts to be thereafter observed and in force.
In determining and fixing rates for a telephone corporation pursuant to this section or pursuant to Section 455, or in determining whether or not a proposed rate increase is justified pursuant to Section 454, the commission shall, among other things, take into consideration any evidence offered concerning the quality of the particular telephone corporation’s services as compared with that of telephone corporations in adjacent territory, and the permissible rates for comparable service charged by telephone corporations in adjacent territory.
For purposes of this section, “plant held for future use account” means account number 105 of the Uniform System of Accounts Prescribed for Public Utilities and Licensees, as adopted by the commission.
The commission shall review the status of all property owned by a gas or electrical corporation and held within the plant held for future use account at least once every three years or during a proceeding conducted pursuant to Section 728, for the purpose of determining and fixing the rates of that gas or electrical corporation, as determined by the commission.
If a gas or electrical corporation sells property which was carried within the plant held for future use account and which was included in determining the rates of the corporation, the commission shall determine what portion of any gains from the sale shall be allocated to the customers of the corporation in a manner consistent with the procedures specified in account number 105 of the Uniform System of Accounts Prescribed for Public Utilities and Licensees. The portion of the gains allocated to customers shall not be less than the amount the corporation has recovered through rates for the carrying costs and other expenses of the property during the period it was carried in the plant held for future use, and shall not exceed the gain on the sale, net of any tax, resulting from the sale.
Except as provided in subdivision (b), the commission shall have no jurisdiction or control over classified telephone directories or commercial advertising included as part of the corporation’s alphabetical telephone directories, including the charges for and the form and content of such advertising, except that the commission shall investigate and consider revenues and expenses with regard to the acceptance and publication of such advertising for purposes of establishing rates for other services offered by telephone corporations.
If the commission determines, after a hearing, that any federal action would impair its ability to investigate and consider revenues and expenses with regard to the acceptance and publication of telephone directory advertising for the purpose of establishing rates for other services offered by any telephone corporation, the commission shall have the jurisdiction to regulate commercial advertising in alphabetical and classified directories of telephone corporations, except as provided in this subdivision.
The commission’s jurisdiction to regulate commercial advertising in alphabetical and classified directories of telephone corporations under this subdivision shall be limited to the rates and charges for commercial directory advertising, except that the commission shall investigate and consider revenues and expenses of telephone corporations related to that advertising for purposes of establishing rates for other services offered by telephone corporations.
The commission shall also have no jurisdiction over the following:
The form and content of the advertising in alphabetical and classified directories of telephone corporations.
The form and content of the directories in which that advertising appears.
Directory advertising practices.
The determination of the geographic areas served by those directories.
Complaints by any corporation or person regarding directory advertising.
The commission, by its own motion or on petition of any telephone corporation, may, after a hearing, issue an order relinquishing the jurisdiction assumed under this subdivision, except its jurisdiction to investigate and consider the revenues and expenses specified in paragraph (1) if the commission determines that relinquishing the jurisdiction will not affect its ability to investigate and consider those revenues and expenses. As used in this subdivision, “federal action” means the introduction of a bill in Congress, an order of the Federal Communications Commission, or an order or decision of any federal court which would prohibit state regulatory agencies which have no jurisdiction over directory advertising from considering revenues from this source for ratemaking purposes.
No telephone corporation operating within a service area shall remove any public telephone unless it has posted on the public telephone for not less than 30 days a notice, in a manner and form approved by the commission, indicating that the public telephone is to be removed and containing the appropriate telephone number of the commission which a customer may call for further information.
This section shall not apply when a public telephone is removed for public safety or public nuisance purposes or at the request of the owner or lessee of the property on which the public telephone is located.
A telephone corporation shall list a telephone number as the number for a facsimile machine in its alphabetical or classified directory only if requested to do so by the subscriber.
The commission may establish rates or charges for the transportation of passengers and freight by railroads and other transportation companies, except motor carriers of property, and no railroad or other transportation company under its jurisdiction, except motor carriers of property, shall charge or demand or collect or receive a greater or less or different compensation for that transportation of passengers or freight, or for any service in connection therewith, between the points named in any tariff of rates established by the commission than the rates, fares and charges which are specified in that tariff. The commission may examine books, records and papers of all railroad and other transportation companies, except motor carriers of property; may hear and determine complaints against railroad and other transportation companies; and may issue subpoenas and all necessary process and send for persons and papers. The commission and each of the commissioners may administer oaths, take testimony and punish for contempt in the same manner and to the same extent as courts of record. The commission may prescribe a uniform system of accounts to be kept by all railroad and other transportation companies, except motor carriers of property.
Subdivision (a) is not applicable to network railroad transportation.
Prior to authorizing any change in the amount of the payment required of a telephone corporation which provides service between service areas to a telephone corporation which provides service within a service area for the use of its telephone lines, and prior to assigning to subscribers of a telephone corporation operating within a service area any charge, surcharge, or rate increase that is a result of a decrease in the amount of that payment, the commission shall do all of the following:
Require the telephone corporation requesting authorization to increase subscriber rates or to impose a charge or surcharge on subscribers as a result of a change in the payments, to notify its subscribers, whenever the commission commences a proceeding on its own motion or in response to a petition to authorize a change in the amount of those payments or to impose that charge, surcharge, or rate increase as a result of a change in the amount of those payments.
Require the telephone corporation to provide its subscribers with an exact description of, and explanation for, the change in the amount of the payment or the imposition of a charge, surcharge, or rate increase, within 90 days of the authorized change in the amount of payment or charge, surcharge, or rate increase. The description and explanation shall include a reasonably accurate quantitative assessment of the results of, and the reasons for, the change in the amount of payment or imposition of a charge, surcharge, or rate increase for each class of subscriber.
The commission shall provide the Legislature with the information required of a telephone corporation pursuant to paragraph (2) of subdivision (a), for any change in payments, or imposition of a charge, surcharge, or rate increase as a result of a change in payment, made prior to January 1, 1987, within 60 days after that date.
The commission may, upon a hearing, investigate a single rate, classification, rule, contract, or practice, or any number thereof, or the entire schedule or schedules of rates, classifications, rules, contracts, and practices, or any thereof, of any public utility, and may establish new rates, classifications, rules, contracts, or practices or schedule or schedules in lieu thereof.
A public utility, other than one-way radio paging services, shall not change a group of customers from one rate schedule to another rate schedule, if the change would result in an increase of more than 10 percent in the rate charged to the affected customers, without first notifying customers of the change. Upon the request of an affected customer, the commission may hold a hearing on the change.
The commission shall, upon a hearing, determine the kind and character of facilities and the extent of the operation thereof, necessary reasonably and adequately to meet public requirements for service furnished by common carriers between any two or more points, and shall fix and determine the just, reasonable, and sufficient rates for such service. Whenever two or more common carriers are furnishing service in competition with each other, the commission may, after hearing, when necessary for the preservation of adequate service and when public interest demands, prescribe uniform rates, classifications, rules, and practices to be charged, collected, and observed by all such common carriers.
Subdivision (a) is not applicable to network railroad transportation.
The commission shall notify every state and local public agency and corporation operating a passenger transit system making a written request for such notification before approving any rate increase for the passenger transportation services of any railroad or passenger state corporation within the territory served by such public transit system.
In determining reimbursement to railroad corporations for the operation of rail passenger service, the commission shall not exceed that compensation which would be payable if calculated pursuant to the standards of the Rail Services Planning Office of the Interstate Commerce Commission contained in Title 49 of the Code of Federal Regulations, Part 1127.
Whenever a state agency files with the commission an application for an increase in rates or fares or for any change in the level of service for passenger transportation by a railroad corporation and the state agency has prior to the application held a public hearing on the matter which the commission finds to be complete and adequate, the commission may determine not to hold any further hearing on the matter and in this event shall approve, modify and approve as so modified, or disapprove the application within 90 days of the date of filing with the commission.
On or before June 30, 2024, the commission, in coordination and consultation with the Department of Community Services and Development and other relevant state agencies that provide low-income electric or gas utility customer assistance programs, shall develop a process that, to the extent possible, enables customers to concurrently apply, or begin to apply, to multiple low-income customer assistance programs using data collected during the original application process, including, but not limited to, all of the following programs:
The California Alternate Rates for Energy (CARE) program described in Section 739.1.
The Family Electric Rate Assistance program described in Section 739.12.
The Energy Savings Assistance program described in Section 2790.
The process developed pursuant to paragraph (1) shall be known as the concurrent application process.
The commission shall work with state agencies, electrical corporations, and gas corporations to notify, to the extent possible, eligible individuals that they have been successfully enrolled or are in the process of being enrolled into other programs.
The concurrent application process shall complement, rather than replace, other application processes.
Before sharing data, an electrical corporation or gas corporation shall receive consent from its low-income applicants to use already-obtained application information to begin the enrollment process for other low-income electric or gas utility customer assistance programs.
Whenever the commission, after a hearing finds that the rates, fares, or charges in force over two or more common carriers, between any two points in this state, are unjust, unreasonable, or excessive, or that no satisfactory through route or joint rate, fare, or charge exists between such points, and that the public convenience and necessity demand the establishment of such a through route and joint rate, fare, or charge, the commission may order such common carriers to establish such through route and may establish and fix a joint rate, fare, or charge which will be fair, just, reasonable, and sufficient, to be charged and collected in the future, and the terms and conditions under which such through route shall be operated. The commission may order that freight moving between such points shall be carried by the common carriers participating in such through route and joint rate, without being transferred from the originating cars.
Subdivision (a) is not applicable to network railroad transportation.
If the common carriers do not agree upon the division between them of the joint rates, fares, or charges established by the commission over through routes, the commission shall, after hearing, by supplemental order, establish that division. Where any railroad, or passenger stage corporation that is made a party to a through route has itself over its own line an equally satisfactory through route between the termini of the through route established, that railroad, or passenger stage corporation may require as its division of the joint rate, fare, or charge its local rate, fare, or charge over the portion of its line comprised in the through route, and the commission may, in its discretion, allow to that railroad or passenger stage corporation, more than its local rate, fare, or charge if the commission determines that it will be equitable so to do. The commission may establish and fix through routes and joint rates, fares, or charges over common carriers and stage or auto stage lines which may not be otherwise subject to the provisions of this part, and may fix the division of those joint rates, fares, or charges.
Subdivision (a) is not applicable to network railroad transportation.
When complaint has been made to the commission concerning a rate for a product or commodity furnished or service performed by a public utility, and the commission has found, after investigation, that the public utility has charged an unreasonable, excessive, or discriminatory amount therefor in violation of any of the provisions of this part, the commission may order that the public utility make due reparation to the complainant therefor, with interest from the date of collection if no discrimination will result from that reparation. No order for the payment of reparation upon the ground of unreasonableness shall be made by the commission when the rate in question has, by formal finding, been declared by the commission to be reasonable, and no assignment of a reparation claim shall be recognized by the commission except assignments by operation of law as in cases of death, lack of legal capacity to make decisions, bankruptcy, receivership, or order of court.
If the public utility does not comply with the order for the payment of reparation within the time specified in the order, suit may be instituted in any court of competent jurisdiction to recover the payment within one year from the date of the order, and not after. All complaints for damages resulting from a violation of any of the provisions of this part, except Sections 494 and 532, shall either be filed with the commission, or where concurrent jurisdiction of the cause of action is vested by the Constitution and laws of this State in the courts, in any court of competent jurisdiction, within two years from the time the cause of action accrues, and not after.
All complaints for damages resulting from the violation of any of the provisions of Sections 494 or 532 shall either be filed with the commission, or, where concurrent jurisdiction of the cause of action is vested in the courts of this state, in any court of competent jurisdiction within three years from the time the cause of action accrues, and not after. If claim for the asserted damages has been presented in writing to the public utility concerned within the period of three years, the period shall be extended to include six months from the date notice in writing is given by the public utility to the claimant of the disallowance of the claim, or of any part or parts thereof specified in the notice.
Whenever the commission institutes an investigation of unauthorized undercharge by any public utility, the institution of the investigation by the commission shall toll the three-year period specified in this section until the commission has rendered its initial decision on the matter. The commission shall render its final decision within two years of the date of the order instituting the investigation.
All complaints for the collection of the lawful tariff charges or any part thereof, of public utilities may be filed in any court of competent jurisdiction within three years from the time the cause of action accrues, and not after, but if a public utility presents its claim or demand in writing to the person from whom the tariff charges, or any part thereof, are alleged to be due within such period of three years, that period shall be extended to include six months from the date notice in writing is given to the public utility, by such person, or refusal to pay the demand, or any part or parts thereof specified in the notice of refusal.
If suit for the collection of the lawful tariff charges or any portion thereof of a public utility is filed in any court in accordance with the terms of this section, or if such collection is made by the public utility without filing suit, the person against whom such suit is filed or from whom such collection is made may, within 90 days from the date of service of summons in the suit, or the date of the collection, file with the commission, or with any court of competent jurisdiction, a complaint for damages resulting from the violation of any of the provisions of this part with respect to the transaction to which the suit of the public utility relates, or for which such collection has been made.
A highway carrier, as defined by subdivision (c), a freight forwarder, a party representing a carrier or freight forwarder, or an assignee of a carrier or freight forwarder shall not, based on a filed tariff or a filed contract, collect or attempt to collect any additional charge in excess of the charge originally billed by the carrier or freight forwarder for transportation service previously provided subject to the jurisdiction of the commission, except where there are mistakes in billing that are acknowledged by both parties or that are the result of intentional misrepresentation by the shipper.
Similarly, the person or entity against whom a claim has been made under the circumstances described in paragraph (1) shall not be liable for additional amounts based on a filed tariff or a filed contract, except where there are mistakes in billing acknowledged by both parties or that are the result of intentional misrepresentation by the shipper.
For the purposes of this section, the term “claimant” shall mean the carrier or freight forwarder, or its assignee or representative making a claim for the collection of rates and charges in addition to those originally billed and collected for the transportation.
“Highway carrier” or “carrier” means every corporation or person, their lessees, trustees, receivers or trustees appointed by any court whatsoever, engaged in transportation of property for compensation or hire as a business over any public highway in this state by means of a motor vehicle, except that “highway carrier” does not include:
Any farmer resident of this state who occasionally transports from the place of production to a warehouse, regular market, place of storage, or place of shipment the farm products of neighboring farmers in exchange for like services or for a cash consideration or farm products for compensation.
Persons or corporations hauling their own property.
Any farmer operating a motor vehicle used exclusively in the transportation of his or her livestock and agricultural commodities or in the transportation of supplies to his or her farm.
Any nonprofit agricultural cooperative association organized and acting within the scope of its powers under Chapter 1 (commencing with Section 54001) of Division 20 of the Agricultural Code to the extent only that it is engaged in transporting its own property or the property of its members.
Any person exclusively transporting United States mail pursuant to a contract with the United States government.
Any integrated intermodal small package carrier which is registered subject to Chapter 2.7 (commencing with Section 4120).
Any household goods carrier, as defined in Section 5109.
For purposes of this section, “mistakes in billing” include, but are not limited to, matters such as clerical errors, billing for transportation of a different commodity than the commodity actually shipped, and billing for transportation of a smaller amount of the commodity than the amount actually shipped.
This section shall apply to all claims arising from transportation performed (in whole or in part) before January 1, 1995, including all lawsuits or claims pending on the effective date of this section.
If any claim that qualifies under this section was settled by mutual agreement of the parties to the claim, or resolved by a final adjudication of a federal or state court, before the effective date of this section, the settlement or adjudication shall be treated as binding, enforceable, and not contrary to law, unless the settlement was agreed to as a result of fraud or coercion.
If the claimant has filed, on or before the effective date of this section, a suit for the collection of additional freight charges, the claimant shall notify the person, or entity, from whom additional freight charges are sought of the provisions of this section within 30 days of the effective date of this section.
If, on or before the effective date of this section, the claimant has demanded the payment of additional freight charges and has not filed a suit for the collection of additional freight charges, the claimant shall notify the person, or entity, from whom additional freight charges are sought of the provisions of this section within 30 days of the effective date of this section.
For the purpose of Sections 734 to 737, inclusive, the cause of action shall accrue upon the delivery or tender of delivery of the shipment or the performance of the service or the furnishing of the commodity or product with respect to which complaint is filed or claim made. The remedies in those sections shall be cumulative and in addition to any other remedy or remedies in this part provided in case of failure of a public utility to obey an order or decision of the commission.
In establishing rates for a public utility operating any portion of its line, plant, or system within a federally designated nonattainment area, the commission shall determine which expenses related to compliance with state and local air pollution control requirements for using clean-burning fuels in that area are reasonable and necessary and shall approve those expenses.
As used in this section:
“Baseline quantity” means a quantity of electricity or gas allocated by the commission for residential customers based on from 50 to 60 percent of average residential consumption of these commodities, except that, for residential gas customers and for all-electric residential customers, the baseline quantity shall be established at from 60 to 70 percent of average residential consumption during the winter heating season. In establishing the baseline quantities, the commission shall take into account climatic and seasonal variations in consumption and the availability of gas service. The commission shall review and revise baseline quantities as average consumption patterns change in order to maintain these ratios and may do so during the rate case or other ratesetting proceeding of a gas corporation or electrical corporation. The commission shall make efforts to minimize bill volatility for residential customers, including all-electric residential customers. Those efforts may include modifying the length of the baseline seasons or defining additional baseline seasons.
“Residential customer” means those customers receiving electrical or gas service pursuant to a domestic rate schedule and excludes industrial, commercial, and every other category of customer.
The commission shall designate a baseline quantity of gas and electricity which is necessary to supply a significant portion of the reasonable energy needs of the average residential customer. In estimating those quantities, the commission shall take into account differentials in energy needs between customers whose residential energy needs are currently supplied by electricity alone or by both electricity and gas. The commission shall develop a separate baseline quantity for all-electric residential customers. For these purposes, “all-electric residential customers” are residential customers having electrical service only or whose space heating is provided by electricity, or both. The commission shall also take into account differentials in energy use by climatic zone and season.
The commission shall establish a standard limited allowance which shall be in addition to the baseline quantity of gas and electricity for residential customers dependent on life-support equipment, including, but not limited to, emphysema and pulmonary patients. A residential customer dependent on life-support equipment shall be allocated a higher energy allocation than the average residential customer.
“Life-support equipment” means that equipment which utilizes mechanical or artificial means to sustain, restore, or supplant a vital function, or mechanical equipment which is relied upon for mobility both within and outside of buildings. “Life-support equipment,” as used in this subdivision, includes all of the following: all types of respirators, iron lungs, hemodialysis machines, suction machines, electric nerve stimulators, pressure pads and pumps, aerosol tents, electrostatic and ultrasonic nebulizers, compressors, IPPB machines, and motorized wheelchairs.
The limited allowance specified in this subdivision shall also be made available to paraplegic and quadriplegic persons in consideration of the increased heating and cooling needs of those persons.
The limited allowance specified in this subdivision shall also be made available to multiple sclerosis patients in consideration of the increased heating and cooling needs of those persons.
The limited allowance specified in this subdivision shall also be made available to scleroderma patients in consideration of the increased heating needs of those persons.
The limited allowance specified in this subdivision shall also be made available to persons who are being treated for a life-threatening illness or have a compromised immune system, if a licensed physician and surgeon, a physician assistant practicing within his or her scope of practice in compliance with the Physician Assistant Practice Act (Chapter 7.7 (commencing with Section 3500) of Division 2 of the Business and Professions Code), or a person licensed pursuant to the Osteopathic Initiative Act certifies in writing to the utility that the additional energy, heating, or cooling allowance, or both, is medically necessary to sustain the life of the person or prevent deterioration of the person’s medical condition.
Each electrical corporation and each gas corporation shall, in a timeframe consistent with each electrical and gas corporation’s next general rate case, disclose on the billing statement of a residential customer all of the following:
Cost per kilowatthour or gas therm per tier.
Allocation of kilowatthour or gas therm per tier.
Visual representation of usage and cost per tier.
Usage comparison with prior periods.
Itemized cost components in the bill to identify state and local taxes.
Identification of delivery, generation, public purpose, and other charges.
Contact information for the commission’s Consumer Affairs Branch.
An electrical corporation and a gas corporation shall make available online to residential customers both of the following:
Examples of how conservation measures, including changing thermostat settings and turning off unused lights, could reduce energy usage and costs.
Examples of how energy-saving devices and weatherization measures could reduce energy usage and costs.
The commission may modify, adjust, or add to the requirements of this subdivision as the individual circumstances of each electrical corporation or gas corporation merits, or for master-meter customers, as individual circumstances merit.
The commission shall, as part of the general rate case of an electrical corporation or gas corporation, assess opportunities to improve the quality of information contained in the utility’s periodic billings.
Wholesale electrical or gas purchases, and the rates charged therefor, are exempt from this section.
Nothing contained in this section shall be construed to prohibit experimentation with alternative gas or electrical rate schedules for the purpose of achieving energy conservation.
The commission shall continue a program of assistance to low-income electricity and gas customers with annual household incomes that are no greater than 200 percent of the federal poverty guideline levels, the cost of which shall not be borne solely by any single class of customer. For one-person households, program eligibility shall be based on two-person household guideline levels. The program shall be referred to as the California Alternate Rates for Energy or CARE program. The commission shall ensure that the level of discount for low-income electricity and gas customers correctly reflects the level of need.
The commission shall establish rates for CARE program participants, subject to both of the following:
That the commission ensure that low-income ratepayers are not jeopardized or overburdened by monthly energy expenditures, pursuant to subdivision (b) of Section 382.
That the level of the discount for low-income electricity and gas ratepayers correctly reflects the level of need as determined by the needs assessment conducted pursuant to subdivision (d) of Section 382.
In establishing CARE program discounts for an electrical corporation with 100,000 or more customer accounts in California, the commission shall ensure all of the following:
The entire CARE program discount shall be provided in the form of a reduction in the overall bill for the eligible CARE program customer.
The commission shall work with electrical and gas corporations to establish penetration goals. The commission shall authorize recovery of all administrative costs associated with the implementation of the CARE program that the commission determines to be reasonable, through a balancing account mechanism. Administrative costs shall include, but are not limited to, outreach, marketing, regulatory compliance, certification and verification, billing, measurement and evaluation, and capital improvements and upgrades to communications and processing equipment.
The commission shall examine methods to improve CARE program enrollment and participation. This examination shall include, but need not be limited to, comparing information from the CARE program and the Universal Lifeline Telephone Service (ULTS) program to determine the most effective means of using that information to increase CARE program enrollment, automatic enrollment of ULTS program customers who are eligible for the CARE program, customer privacy issues, and alternative mechanisms for outreach to potential enrollees. The commission shall ensure that a customer consents before enrollment. The commission shall consult with interested parties, including ULTS program providers, to develop the best methods of informing ULTS program customers about other available low-income programs and the best mechanism for telephone providers to recover reasonable costs incurred pursuant to this section.
The commission shall improve the CARE program application process by cooperating with other entities and representatives of California government, including the California Health and Human Services Agency and the Secretary of California Health and Human Services, to ensure that all gas and electricity customers eligible for public assistance programs in California that reside within the service territory of an electrical corporation or gas corporation, are enrolled in the CARE program. The commission may determine that gas and electricity customers are categorically eligible for CARE program assistance if they are enrolled in other public assistance programs with substantially the same income eligibility requirements as the CARE program. To the extent practicable, the commission shall develop a CARE program application process using the existing ULTS program application process as a model. The commission shall work with electrical corporations, gas corporations, and the Low-Income Oversight Board established in Section 382.1 to meet the low-income objectives in this section.
The commission shall ensure that an electrical corporation or gas corporation with a commission-approved program to provide discounts based on economic need in addition to the CARE program, including a Family Electric Rate Assistance program, uses a single application form, to enable an applicant to alternatively apply for any assistance program for which the applicant may be eligible. It is the intent of the Legislature to allow applicants under one program, who may not be eligible under that program, but who may be eligible under an alternative assistance program based on economic need, to complete a single application for any commission-approved assistance program offered by the public utility.
It is the intent of the Legislature that the commission ensure CARE program participants receive affordable electrical and gas service that does not impose an unfair economic burden on those participants.
The CARE program shall, as soon as practicable, include nonprofit group living facilities specified by the commission, if the commission finds that the residents in these facilities substantially meet the commission’s low-income eligibility requirements and there is a feasible process for certifying that the assistance shall be used for the direct benefit, such as improved quality of care or improved food service, of the low-income residents in the facilities. The commission shall authorize electrical corporations and gas corporations to offer discounts to eligible facilities licensed or permitted by appropriate state or local agencies, and to facilities, including women’s shelters, hospices, and homeless shelters, that may not have a license or permit but provide other proof satisfactory to the electrical corporation or gas corporation that they are eligible to participate in the CARE program.
The CARE program shall, as soon as practicable, include public housing authority owned or administered Homekey housing facilities, as described in Section 50675.1.1 of the Health and Safety Code, where the residents of the facility substantially meet the CARE program’s income eligibility requirements, as determined by the commission, and the account is in the name of Homekey, a nonprofit funded by Homekey, or the public housing authority that owns or administers the facility. The commission shall authorize electrical corporations and gas corporations to offer discounts to those identified facilities and to establish feasible processes for certifying that the assistance is used for the direct benefit of the residents of those facilities.
In addition to existing assessments of eligibility, an electrical corporation may require proof of income eligibility for those CARE program participants whose electricity usage, in any monthly or other billing period, exceeds 400 percent of baseline usage. The authority of an electrical corporation to require proof of income eligibility is not limited by the means by which the CARE program participant enrolled in the program, including if the participant was automatically enrolled in the CARE program because of participation in a governmental assistance program. If a CARE program participant’s electricity usage exceeds 400 percent of baseline usage, the electrical corporation may require the CARE program participant to participate in the Energy Savings Assistance Program (ESAP), which includes a residential energy assessment, in order to provide the CARE program participant with information and assistance in reducing the CARE program participant’s energy usage. Continued participation in the CARE program may be conditioned upon the CARE program participant agreeing to participate in ESAP within 45 days of notice being given by the electrical corporation pursuant to this paragraph. The electrical corporation may require the CARE program participant to notify the electrical corporation of whether the residence is rented, and, if so, a means by which to contact the landlord, and the electrical corporation may share any evaluation and recommendation relative to the residential structure that is made as part of an energy assessment with the landlord of the CARE program participant. Requirements imposed pursuant to this paragraph shall be consistent with procedures adopted by the commission.
If a CARE program participant’s electricity usage exceeds 600 percent of baseline usage, the electrical corporation shall require the CARE program participant to participate in ESAP, which includes a residential energy assessment, in order to provide the CARE program participant with information and assistance in reducing the CARE program participant’s energy usage. Continued participation in the CARE program shall be conditioned upon the CARE program participant agreeing to participate in ESAP within 45 days of a notice made by the electrical corporation pursuant to this paragraph. The electrical corporation may require the CARE program participant to notify the electrical corporation of whether the residence is rented, and, if so, a means by which to contact the landlord, and the electrical corporation may share any evaluation and recommendation relative to the residential structure that is made as part of an energy assessment with the landlord of the CARE program participant. Following the completion of the energy assessment, if the CARE program participant’s electricity usage continues to exceed 600 percent of baseline usage, the electrical corporation may remove the CARE program participant from the program if the removal is consistent with procedures adopted by the commission. This paragraph does not prevent a CARE program participant with electricity usage exceeding 600 percent of baseline usage from participating in an appeals process with the electrical corporation to determine whether the participant’s usage levels are legitimate.
A CARE program participant in a rental residence shall not be removed from the program in situations where the landlord is nonresponsive when contacted by the electrical corporation or does not provide for ESAP participation.
The commission’s program of assistance to low-income electric and gas customers shall also include the following facilities, provided the commission finds that the occupants of the facilities substantially meet the commission’s low-income eligibility requirements and there is a feasible process for certifying that the assistance shall be used for the direct benefit of the occupants of the facilities:
Migrant farmworker housing centers provided pursuant to Section 50710 of the Health and Safety Code.
Employee housing, as defined in Section 17008 of the Health and Safety Code, that is licensed and inspected by state or local agencies pursuant to Part 1 (commencing with Section 17000) of Division 13 of the Health and Safety Code.
The assistance provided pursuant to subdivision (a) shall only apply to gas and electricity, or both, used for the housing occupied by the workers and employees specified in subdivision (a).
Subject to direction and supervision by the commission, each electrical corporation and gas corporation shall develop and implement a program of rate assistance to eligible food banks at a fixed percentage to be determined by the commission. The commission may adjust the fixed percentage as appropriate. The funding source for the rate assistance program is subject to the approval of the commission.
The Legislature encourages the governing board of each local publicly owned electric utility to develop and implement a program of rate assistance to eligible food banks at a fixed percentage, to be determined by the governing board, but consistent with that fixed by the commission for electrical corporations.
For purposes of this section, the following terms have the following meanings:
“Eligible food bank” means a qualified eligible recipient agency that has executed an agreement with the State Department of Social Services in order to participate in The Emergency Food Assistance Program administered by the Food and Nutrition Service of the United States Department of Agriculture.
“Eligible recipient agency” has the same meaning as defined in Section 251.3(d) of Title 7 of the Code of Federal Regulations.
“Agreement” means an agreement executed in compliance with Section 251.2 of Title 7 of the Code of Federal Regulations.
Any natural gas customer who enrolls in the CARE program after the effective date of this section, but before October 1, 2001, shall receive the same one-time bill credit based on the amount of each gas corporation’s average CARE customer discount applied for each month in October 2000 to March 2001, inclusive. The credit does not apply to a customer who initiates service with a gas corporation after the effective date of this section, and who has no prior history of service with the gas corporation. CARE program funds shall be used for the purpose of providing these credits. The commission shall adjust CARE program income requirements annually to reflect the increased cost-of-living due to inflation.
The commission shall require all electrical and gas utilities through which CARE program rates are available to do all of the following, in multilingual formats to the extent printed and recorded information is provided, to facilitate better penetration rates for the CARE program and to protect low-income and senior households from unwarranted disconnection of necessary electric and gas services:
Provide an outgoing message on all calls, where the customer is seeking to establish service or is put on hold, to customer service lines that briefly describes the CARE program in standard language approved by the commission, and that provides a toll-free phone number for customers to call to subscribe to the program or for further information.
Provide information to customers about the CARE program and facilitate subscription to CARE, on all calls in which customers are making payment arrangements, on all collections calls, and on all calls for reconnection of service.
Provide information about the CARE program and other assistance programs, and attempt to qualify customers for CARE, and provide information about individual payment arrangements that allow customers to pay the amounts due over a reasonable period of time, not to exceed 12 months, and attempt to enroll customers in a payment arrangement program, before effecting any disconnection of service for nonpayment or inability to pay energy bills in full.
Offer individual payment arrangements to customers so that the customer is able to pay amounts due over a reasonable period of time, not to exceed 12 months.
Prohibit the disconnection of customers that have made, and are in compliance with, payment arrangements offered by an electric or gas utility pursuant to this subparagraph.
Prohibit the disconnection of a delinquent residential customer for amounts due in which the electric or gas utility receives a commitment pledge, letter of intent, purchase order, or other notification that a provider of energy assistance is forwarding payment sufficient to prevent disconnection.
Advise residential customers facing disconnection or who contact the utility to make payment arrangements of the levelizing payment program that allows them to pay a monthly average bill based on 12 months usage.
Advise residential customers about enrollment in the levelizing payment program in conjunction with completion of payment arrangements, payment under terms of subparagraph (B), or at the customer’s request absent those arrangements.
Nothing in this paragraph is intended to reduce the revenues of any utility extending payment arrangements subject to the terms of the paragraph.
Provide information on customer bills, presented in a conspicuous manner on a front facing page, that indicates that a customer may be eligible for the CARE program. This notice shall be provided quarterly on customer bills.
The commission shall conduct targeted outreach about the program using census block data to effectively target low-income and senior households throughout the state.
CARE program funds shall be used for the purposes of paragraph (3) of subdivision (b) and outreach pursuant to subdivision (c). The commission’s costs for outreach pursuant to subdivision (c) may not exceed five hundred thousand dollars ($500,000) above the amount that the commission currently expends on similar activities related to the CARE program. Energy corporations may recover all reasonable costs from the CARE program funds of implementing this section.
The commission shall require that, whenever gas or electrical service, or both, is provided by a master-meter customer to users who are tenants of a mobilehome park, apartment building, or similar residential complex, the master-meter customer shall charge each user of the service at the same rate that would be applicable if the user were receiving gas or electricity, or both, directly from the gas corporation or load-serving entity, as defined in Section 380. The commission shall require a gas or electrical corporation furnishing service to the master-meter customer to establish uniform rates for master-meter service at a level that will provide a sufficient differential to cover the reasonable average costs to master-meter customers of providing submeter service, except that these costs shall not exceed the average cost that the gas or electrical corporation would have incurred in providing comparable services directly to the users of the service.
Every master-meter customer of a gas corporation or load-serving entity subject to subdivision (a) who, on or after January 1, 1978, receives any rebate from a load-serving entity or gas corporation shall distribute to, or credit to the account of, each current user served by the master-meter customer that portion of the rebate which the amount of gas or electricity, or both, consumed by the user during the last billing period bears to the total amount furnished by the load-serving entity or gas corporation to the master-meter customer during that period.
Paragraph (1) includes the credits stemming from the revenues received by the electrical corporation as a result of the direct allocation of greenhouse gas allowances to electric utilities pursuant to subdivision (b) of Section 95890 of Title 17 of the California Code of Regulations, that are required to be credited to customers of the electrical corporation pursuant to Section 748.5.
An electrical or gas corporation furnishing service to a master-meter customer shall furnish to each user of the service within a submetered system every public safety customer service which it provides beyond the meter to its other residential customers. The corporation shall furnish a list of those services to the master-meter customer who shall post the list in a conspicuous place accessible to all users. Every corporation shall provide these public safety customer services to each user of electrical or gas service under a submetered system without additional charge unless the corporation has included the average cost of these services in the rate differential provided to the master-meter customer on January 1, 1984, in which case the commission shall deduct the average cost of providing these public safety customer services when approving rate differentials for master-meter customers.
Every master-meter customer is responsible for maintenance and repair of its submeter facilities beyond the master-meter, and nothing in this section requires a load-serving entity or gas corporation to make repairs to or perform maintenance on the submeter system.
Every master-meter customer shall provide an itemized billing of charges for electricity or gas, or both, to each individual user generally in accordance with the form and content of bills of the load-serving entity or gas corporation to its residential customers, including, but not limited to, the opening and closing readings for the meter, and the identification of all rates and quantities attributable to each block in the applicable rate structure. The master-meter customer shall also post, in a conspicuous place, the applicable specific current residential gas or electrical rate schedule, as published by the load-serving entity or gas corporation, or the load-serving entity’s or gas corporation’s internet website address of the specific current residential gas or electrical rate schedule. If the master-meter customer elects to post the internet website address where the schedule may be accessed, the master-meter customer shall also: (1) provide a copy of the specific current residential gas or electrical rate schedule, upon request, at no cost; and (2) state in the posting that an individual user may request a copy of the rate schedule from the master-meter customer.
The commission shall require that every load-serving entity and gas corporation shall notify each master-meter customer of its responsibilities to its users under this section.
The commission shall accept and respond to complaints concerning the requirements of this section that apply to a gas or electrical corporation through the consumer affairs branch, in addition to any other staff that the commission deems necessary to assist the complainant. In responding to the complaint, the commission shall consider the role that the office of the county sealer in the complainant’s county of residence may have in helping to resolve the complaint and, where appropriate, coordinate with that office.
Notwithstanding any other provision of law or decision of the commission, the commission shall not deny eligibility for the California Alternative Rates for Energy (CARE) program, created pursuant to Section 739.1, for a residential user of gas or electrical service who is a submetered resident or tenant served by a master-meter customer on the basis that some residential units in the master-meter customer’s mobilehome park, apartment building, or similar residential complex do not receive gas or electrical service through a submetered system.
For purposes of this section, “rebate” does not include the award of a monetary incentive under the California Solar Initiative adopted by the Public Utilities Commission in Decision 05-12-044 and Decision 06-01-024, as modified by Article 1 (commencing with Section 2851) of Chapter 9 of Part 2, for a solar energy system that provides electrical generation to a mobilehome park.
The commission shall establish rates using cost allocation principles that fairly and reasonably assign to different customer classes the costs of providing service to those customer classes, consistent with the policies of affordability and conservation. The cost allocation methodology adopted for gas corporations by the commission in Decisions 86-12-009 and 86-12-010, as supplemented by Decisions 87-05-046 and 87-12-039, is consistent with this policy, and shall be retained by the commission at least until December 31, 1990, except that the commission may modify this cost allocation methodology to address customer hardships and inequities if residential customers as a class are not, on balance, adversely affected and the purpose of the modification is not solely protection of gas corporation revenues. If any gas corporation files a cost allocation application seeking to change that methodology after May 1, 1990, the commission may not issue an order on that application until January 1, 1991.
In establishing residential rates, the commission shall retain an appropriate inverted rate structure. If the commission increases baseline rates pursuant to Section 739, revenues resulting from those increases shall be used exclusively to reduce nonbaseline residential rates.
Access to an adequate supply of healthful water is a basic necessity of human life, and shall be made available to all residents of California at an affordable cost.
The commission shall consider and may implement programs to provide rate relief for low-income ratepayers.
The commission shall consider and may implement programs to assist low-income ratepayers in order to provide appropriate incentives and capabilities to achieve water conservation goals.
In establishing the feasibility of rate relief and conservation incentives for low-income ratepayers, the commission may take into account variations in water needs caused by geography, climate and the ability of communities to support these programs.
“Fixed charge” means any fixed customer charge, basic service fee, demand differentiated basic service fee, demand charge, or other charge not based on the volume of electricity consumed.
Increases to electrical rates and charges in rate design proceedings, including any reduction in the California Alternate Rates for Energy (CARE) discount, shall be reasonable and subject to a reasonable phase-in schedule relative to the rates and charges in effect before January 1, 2014.
Consistent with the requirements of Section 739, the commission may modify the seasonal definitions and applicable percentage of average consumption for one or more climatic zones.
The commission may adopt new, or expand existing, fixed charges for the purpose of collecting a reasonable portion of the fixed costs of providing electrical service to residential customers. The commission shall ensure that any approved charges do all of the following:
Reasonably reflect an appropriate portion of the different costs of serving small and large customers.
Not unreasonably impair incentives for conservation, energy efficiency, and beneficial electrification and greenhouse gas emissions reduction.
Are set at levels that do not overburden low-income customers.
For the purposes of this section and Section 739.1, the commission may authorize fixed charges for any rate schedule applicable to a residential customer account. The fixed charge shall be established on an income-graduated basis with no fewer than three income thresholds so that a low-income ratepayer in each baseline territory would realize a lower average monthly bill without making any changes in usage. The commission shall, no later than July 1, 2024, authorize a fixed charge for default residential rates.
For purposes of this subdivision, “income-graduated” means that low-income customers pay a smaller fixed charge than high-income customers.
Notwithstanding the requirements of subdivision (d) of Section 739 and Section 739.7, the commission shall not apply the composite tier method to the treatment of any revenues resulting from any fixed charge adopted pursuant to this section.
The commission shall ensure that errors in estimates of demand elasticity or sales do not result in material over or undercollections of the electrical corporations.
For bills issued to customers of gas corporations and electrical corporations in which usage is estimated, it is the intent of the Legislature that, to the extent practicable, the methodology for estimation be simple, transparent, and cost effective to the customer, and produce reasonably accurate results.
For each gas corporation and electrical corporation that, for some portion of residential customers, employs every-other-month meter reading and estimates bills for months when the customer’s meter is not read, the commission shall direct the gas corporation or electrical corporation to include in its tariffs the methodology it employs to estimate bills for those months during which the meter is not read.
The commission shall continue a program of assistance to residential customers of the state’s three largest electrical corporations consisting of households with total household annual gross income levels between 200 percent and 250 percent of the federal poverty guideline level. The program shall continue to be referred to as the Family Electric Rate Assistance or FERA program.
The FERA program discount shall be an 18-percent line-item discount applied to an eligible customer’s bill calculated at the applicable rate for the billing period.
The commission shall authorize the state’s three largest electrical corporations to increase or expand marketing and outreach efforts beyond those in effect as of December 31, 2018, to increase eligible customer participation in the FERA program.
The commission, by March 1, 2025, and each year thereafter, shall require the state’s three largest electrical corporations to report on their efforts to enroll customers in the FERA program.
The commission, by June 1, 2025, and each year thereafter, shall review each electrical corporation’s report to ensure it has made reasonable efforts to enroll eligible households in the FERA program commensurate with the proportion of households the commission determines to be eligible within the electrical corporation’s service territory.
If the commission, in its review of an electrical corporation’s report, determines the electrical corporation has not made reasonable efforts to enroll eligible households in the FERA program commensurate with the proportion of households the commission determines to be eligible within the electrical corporation’s service territory, the commission shall require the electrical corporation to develop a strategy and plan to sufficiently enroll eligible households within three years of the adoption of the strategy and plan.
An electrical corporation may market enrollment for the FERA program separately from the CARE program and provide a separate FERA program-only application form.
The commission shall develop a definition of energy affordability.
The definition of energy affordability shall establish energy affordability metrics based on household income and include the combined impact of electricity and gas bills.
The commission shall use energy affordability metrics for both of the following purposes:
To guide the development of any protections, incentives, discounts, or new programs to assist residential customers facing hardships or disconnections due to electricity or gas bills.
To assess the impact of proposed rate increases on different types of residential customers.
The commission shall determine in a scoping ruling or other ruling whether an application from an electrical corporation or gas corporation requesting authorization for or recovery of capital expenditures requires the estimates described in subdivision (b).
An application from an electrical corporation or gas corporation requesting authorization for or recovery of capital expenditures, including an application for conditional approval of the costs of an undergrounding plan pursuant to Section 8388.5, shall include, if the commission pursuant to subdivision (a) determines that the estimates are required, the electrical corporation’s or gas corporation’s best estimate of both of the following:
The application’s impact on the electrical corporation’s or gas corporation’s annual revenue requirement for each year that the capital expenditures described in the application are expected to remain in the application’s rate base if the application is approved or conditionally approved.
The net present value of the application’s impact on the electrical corporation’s or gas corporation’s annual revenue requirement provided pursuant to paragraph (1).
The commission shall require the electrical corporation or gas corporation to provide supporting workpapers and calculations for the estimates described in subdivision (b).
For purposes of setting the rates to be charged by every electrical corporation, gas corporation, heat corporation or telephone corporation for the services or commodities furnished by it, the commission may allow the inclusion of expenses for research and development.
The commission shall consider the following guidelines in evaluating the research, development, and demonstration programs proposed by electrical and gas corporations:
Projects should offer a reasonable probability of providing benefits to ratepayers.
Expenditures on projects which have a low probability for success should be minimized.
Projects should be consistent with the corporation’s resource plan.
Projects should not unnecessarily duplicate research currently, previously, or imminently undertaken by other electrical or gas corporations or research organizations.
Each project should also support one or more of the following objectives:
Environmental improvement.
Public and employee safety.
Conservation by efficient resource use or by reducing or shifting system load.
Development of new resources and processes, particularly renewable resources and processes which further supply technologies.
Improve operating efficiency and reliability or otherwise reduce operating costs.
The commission, in consultation with the Energy Commission, State Air Resources Board, electrical corporations, and the motor vehicle industry, shall evaluate policies to develop infrastructure sufficient to overcome any barriers to the widespread deployment and use of plug-in hybrid and electric vehicles. By July 1, 2011, the commission shall adopt rules to address all of the following:
The impacts upon electrical infrastructure, including infrastructure upgrades necessary for widespread use of plug-in hybrid and electric vehicles and the role and development of public charging infrastructure.
The impact of plug-in hybrid and electric vehicles on grid stability and the integration of renewable energy resources.
The technological advances that are needed to ensure the widespread use of plug-in hybrid and electric vehicles and what role the state should take to support the development of this technology.
The existing code and permit requirements that will impact the widespread use of plug-in hybrid and electric vehicles and any recommended changes to existing legal impediments to the widespread use of plug-in hybrid and electric vehicles.
The role the state should take to ensure that technologies employed in plug-in hybrid and electric vehicles work in a harmonious manner and across service territories.
The impact of widespread use of plug-in hybrid and electric vehicles on achieving the state’s goals pursuant to the California Global Warming Solutions Act of 2006 and renewables portfolio standard program and what steps should be taken to address possibly shifting emissions reductions responsibilities from the transportation sector to the electrical industry.
The commission, in cooperation with the Energy Commission, the State Air Resources Board, air quality management districts and air pollution control districts, regulated electrical and gas corporations, and the motor vehicle industry, shall evaluate and implement policies to promote the development of equipment and infrastructure needed to facilitate the use of electricity and natural gas to fuel low-emission vehicles. Policies to be considered shall include both of the following:
The sale-for-resale and the rate-basing of low-emission vehicles and supporting equipment such as batteries for electric vehicles and compressor stations for natural gas fueled vehicles.
The development of statewide standards for electric vehicle charger connections and compressed natural gas vehicle fueling connections, including installation procedures and technical assistance to installers.
The commission shall hold public hearings as part of its effort to evaluate and implement the new policies considered in subdivision (a).
The commission’s policies authorizing utilities to develop equipment or infrastructure needed for electricity-powered and natural gas-fueled low-emission vehicles shall ensure that the costs and expenses of those programs are not passed through to electrical or gas ratepayers unless the commission finds and determines that those programs are in the ratepayers’ interest. The commission’s policies shall also ensure that utilities do not unfairly compete with nonutility enterprises.
The commission shall authorize public utilities to engage in programs to encourage economic development.
Reasonable expenses for economic development programs, as specified in this section, shall be allowed, to the extent of ratepayer benefit, when setting rates to be charged by public utilities electing to initiate these programs.
Economic development activities may include, but not be limited to, the following:
Community marketing and development.
Technical assistance to support technology transfer.
Market research.
Site inventories.
Industrial and commercial expansion and relocation assistance.
Business retention and recruitment.
Management assistance.
This section shall not be interpreted to permit the funding of economic development activities that benefit any affiliated companies or parent holding companies beyond that which is authorized by law as of January 1, 1992.
This section does not authorize the commission to establish discriminatory rates for the purpose of attracting or benefiting specific industries or business entities, except that incentives may be provided for the benefit of industries or business entities whose facilities are located within the boundaries of enterprise zones, economic incentive areas, recycling market development zones, or federal rural enterprise communities in accordance with the provisions of Chapter 12.8 (commencing with Section 7070) and Article 1 (commencing with Section 7080) of Chapter 12.9 of Division 7 of Title 1 of the Government Code, and Article 2 (commencing with Section 42145) of Chapter 3 of Part 3 of the Public Resources Code.
The commission may apply the incentives authorized by this subdivision that benefit industries or business entities whose facilities are located within the boundaries of economic enterprise zones or incentive areas to attract a federal Department of Defense Finance and Accounting Service Center at the existing site of Norton Air Force Base in San Bernardino County. This paragraph shall become inoperative if the federal Department of Defense Finance and Accounting Service Center is not located upon the premises known as Norton Air Force Base in San Bernardino County and shall also become inoperative on February 1, 1994, if that facility has not been awarded to that site before that date.
The commission may provide incentives pursuant to subdivision (e) to industries or business entities whose facilities are located within the boundaries of an enterprise zone that engage in activities in connection with the conversion of Fort Ord to other uses.
The commission may authorize rate discounts to industries or business entities whose facilities are located or will be located within the boundaries of enterprise zones, recycling market development zones, or economic incentive areas pursuant to paragraph (1) of subdivision (e). These discounts may be applied in either of the following ways:
Utilities may apply reduced monthly rates to qualifying customers’ monthly utility bills.
Utilities may, at the election of qualifying customers, assign the discounts to a private or public entity that returns consideration of like value to those customers, provided the customers agree to maintain their facilities in an enterprise zone, a recycling market development zone, or an economic incentive area for a minimum of five years from the date of commencement of the discount.
It is the intent of the Legislature that the Public Utilities Commission, in implementing this chapter, shall allow rate recovery of expenses and rate discounts supporting economic development programs within the geographic area served by any public utility to the extent the utility incurring or proposing to incur those expenses and rate discounts demonstrates that the ratepayers of the public utility will derive a benefit from those programs. Further, it is the intent of the Legislature that expenses for economic development programs incurred prior to the effective date of this chapter, which have not been previously authorized to be recovered in rates, shall not be subject to rate recovery.
For purposes of this section, “21st Century Energy System Decision” means commission Decision 12-12-031 (December 20, 2012), Decision Granting Authority to Enter Into a Research and Development Agreement with Lawrence Livermore National Laboratory for 21st Century Energy Systems and for costs up to one hundred fifty-two million one hundred ninety thousand dollars ($152,190,000) or any subsequent decision in Application 11-07-008 (July 18, 2011), Application of Pacific Gas and Electric Company (U39M), San Diego Gas and Electric Company (U902E), and Southern California Edison Company (U338E) for Authority to Increase Electric Rates and Charges to Recover Costs of Research and Development Agreement with Lawrence Livermore National Laboratory for 21st Century Energy Systems.
In implementing the 21st Century Energy System Decision, the commission shall not authorize recovery from ratepayers of any expense for research and development projects that are not for purposes of cyber security and grid integration. Total funding for research and development projects for purposes of cyber security and grid integration pursuant to the 21st Century Energy System Decision shall not exceed thirty-five million dollars ($35,000,000). All cyber security and grid integration research and development projects shall be concluded by the fifth anniversary of their start date.
The commission shall not approve for recovery from ratepayers those program management expenditures proposed, commencing with page seven, in the joint advice letter filed by the state’s three largest electrical corporations, Advice 3379-G/4215-E (Pacific Gas and Electric Company), Advice 2887-E (Southern California Edison Company), and Advice 2473-E (San Diego Gas and Electric Company), dated April 19, 2013. Project managers for the 21st Century Energy System Decision shall be limited to three representatives, one representative each from Pacific Gas and Electric Company, Southern California Edison Company, and San Diego Gas and Electric Company.
The commission shall require the Lawrence Livermore National Laboratory, as a condition for entering into any contract pursuant to the 21st Century Energy System Decision, and Pacific Gas and Electric Company, Southern California Edison Company, and San Diego Gas and Electric Company to ensure that research parameters reflect a new contribution to cyber security and that there not be a duplication of research being done by other private and governmental entities.
The commission may authorize investor-owned gas and electric utilities to match grants provided to nonprofit agencies and local governments to participate in the Department of Economic Opportunity’s pilot program to identify and counsel low-income individuals and group facilities that are eligible to receive rate discounts and weatherization benefits offered by those utilities. The amount of utility matching funds for the pilot program shall be limited to a statewide total of three hundred thousand dollars ($300,000). The commission shall require that utility expenditures for those purposes be recoverable in rates.
If federal funds become available for low-income energy assistance or weatherization programs that may be secured with matching funds from states or utilities, the commission may authorize investor-owned gas and electric utilities to match those federal funds, and shall require that utility expenditures for those purposes be recoverable in rates.
Interruptible service or curtailment programs adopted by the commission shall assure that the programs allow customers to aggregate multiple accounts to meet any minimum kilowatt requirements for participation in the program, subject to geographical, load, and other parameters, as determined by the commission.
Safer, more reliable, or less costly gas or electrical service, consistent with Section 451, including electrical service that is safer, more reliable, or less costly due to either improved use of the electric system or improved integration of renewable energy generation.
Any one of the following:
Improvement in energy efficiency of travel.
Reduction of health and environmental impacts from air pollution.
Reduction of greenhouse gas emissions related to electricity and natural gas production and use.
Increased use of alternative fuels.
Creating high-quality jobs or other economic benefits, including in disadvantaged communities identified pursuant to Section 39711 of the Health and Safety Code.
Any optional binding mandatory curtailment program adopted by the commission that exempts customers from Stage 3 rotating outages in exchange for partial load curtailments during every rotating outage period shall provide, for agricultural and water supplier customers, the use of backup generation to offset the curtailed load under the program, to the extent the use of backup generation is allowed under existing law, including, but not limited to, all relevant local air pollution control district and air quality management district rules and regulations.
Each public utility electrical corporation shall develop and offer its customers, on or before May 30, 2001, the opportunity to participate, in addition to other programs developed by the commission, in a demand reduction program as described in this section.
The program required by this section shall identify specific periods coincident with morning or evening system peak conditions determined by the Independent System Operator within which the customer agrees to drop a preset amount of load. This program shall be known as the Scheduled Load Reduction Program. The commission shall develop appropriate incentives for customers to participate in the program.
In recognition of the fact that agricultural and water supplier customers necessarily have high electricity usage during peak summer demand periods, the Legislature strongly urges the commission to consider providing the option to all agricultural commodity processing customers to be included in the definition of customers eligible to be served under agricultural tariffs, consistent with its other constitutional and statutory objectives, and to the extent it does not result in cost shifting to other customer classes.
The Legislature finds and declares all of the following:
Advanced clean vehicles and fuels are needed to reduce petroleum use, to meet air quality standards, to improve public health, and to achieve greenhouse gas emissions reduction goals.
Widespread transportation electrification is needed to achieve the goals of the Charge Ahead California Initiative (Chapter 8.5 (commencing with Section 44258) of Part 5 of Division 26 of the Health and Safety Code).
Widespread transportation electrification requires increased access for disadvantaged communities, low- and moderate-income communities, and other consumers of zero-emission and near-zero-emission vehicles, and increased use of those vehicles in those communities and by other consumers to enhance air quality, lower greenhouse gases emissions, and promote overall benefits to those communities and other consumers.
Reducing emissions of greenhouse gases to 40 percent below 1990 levels by 2030 and to 80 percent below 1990 levels by 2050 will require widespread transportation electrification.
Widespread transportation electrification requires electrical corporations to increase access to the use of electricity as a transportation fuel.
Widespread transportation electrification should stimulate innovation and competition, enable consumer options in charging equipment and services, attract private capital investments, and create high-quality jobs for Californians, where technologically feasible.
Deploying electric vehicles should assist in grid management, integrating generation from eligible renewable energy resources, and reducing fuel costs for vehicle drivers who charge in a manner consistent with electrical grid conditions.
Deploying electric vehicle charging infrastructure should facilitate increased sales of electric vehicles by making charging easily accessible and should provide the opportunity to access electricity as a fuel that is cleaner and less costly than gasoline or other fossil fuels in public and private locations.
According to the State Alternative Fuels Plan analysis by the Energy Commission and the State Air Resources Board, light-, medium-, and heavy-duty vehicle electrification results in approximately 70 percent fewer greenhouse gases emitted, over 85 percent fewer ozone-forming air pollutants emitted, and 100 percent fewer petroleum used. These reductions will become larger as renewable generation increases.
It is the policy of the state and the intent of the Legislature to encourage transportation electrification as a means to achieve ambient air quality standards and the state’s climate goals. Agencies designing and implementing regulations, guidelines, plans, and funding programs to reduce greenhouse gas emissions shall take the findings described in paragraph (1) into account.
The commission, in consultation with the State Air Resources Board and the Energy Commission, shall direct electrical corporations to file applications for programs and investments to accelerate widespread transportation electrification to reduce dependence on petroleum, meet air quality standards, achieve the goals set forth in the Charge Ahead California Initiative (Chapter 8.5 (commencing with Section 44258) of Part 5 of Division 26 of the Health and Safety Code), and reduce emissions of greenhouse gases to 40 percent below 1990 levels by 2030 and to 80 percent below 1990 levels by 2050. Programs proposed by electrical corporations shall seek to minimize overall costs and maximize overall benefits. The commission shall approve, or modify and approve, programs and investments in transportation electrification, including those that deploy charging infrastructure, via a reasonable cost recovery mechanism, if they are consistent with this section, do not unfairly compete with nonutility enterprises as required under Section 740.3, include performance accountability measures, and are in the interests of ratepayers as defined in Section 740.8. Not less than 35 percent of the investments pursuant to this subdivision shall be in underserved communities as that term is defined in Section 1601.
The commission shall review data concerning current and future electric transportation adoption and charging infrastructure utilization prior to authorizing an electrical corporation to collect new program costs related to transportation electrification in customer rates. If market barriers unrelated to the investment made by an electric corporation prevent electric transportation from adequately utilizing available charging infrastructure, the commission shall not permit additional investments in transportation electrification without a reasonable showing that the investments would not result in long-term stranded costs recoverable from ratepayers.
This section applies to an application to the commission for transportation electrification programs and investments if one of the following conditions is met:
The application is filed on or after January 1, 2016.
The application is filed before January 1, 2016, but has an evidentiary hearing scheduled on or after July 1, 2016.
For purposes of this section, the following terms have the following meanings:
“Charging station” means the removable equipment that provides alternating or direct current to the battery electric vehicle or plug-in hybrid electric vehicle, but does not include the supporting charging infrastructure, such as wiring, conduit, and electric panel.
“Educational institution” has the same meaning as defined in Section 22129 of the Education Code.
“School facility” means owned or leased improved real property used for the purpose of the private or public education of more than 12 children in kindergarten or any of grades 1 to 12, inclusive, or in any combination thereof, or any other facility of a school district or county office of education where activities described in subdivision (c) are provided, but does not include any private school in which education is conducted primarily in private homes.
By July 30, 2018, an electrical corporation may file with the commission a pilot program proposal for the installation of electrical grid integrated charging stations at school facilities and other educational institutions. The proposal may include parameters for the installation of charging infrastructure for transportation vehicles, such as schoolbuses, owned by a school district, county office of education, private school, or other educational institution. By December 31, 2018, the commission shall review, modify if appropriate, and decide whether to approve a pilot program proposal filed by an electrical corporation.
A school district, county office of education, private school, or other educational institution choosing to participate in the program shall have the authority to establish guidelines for use of the charging stations installed pursuant to the approved program, which may include use by faculty, students, and parents, before, during, and after school hours at those times that the school facilities or other educational institutions are operated for purposes of providing education or school-related activities, including, but not limited to, parent-teacher conferences, clubs, theater, and athletic events, and by any other persons present for those activities and events.
Construction and maintenance of the charging stations and infrastructure shall be managed in coordination with the school district, county office of education, private school, or other educational institution.
The approved pilot program shall include a reasonable mechanism for cost recovery by the electrical corporation if the commission finds all of the following are true:
The costs to be recovered are consistent with a cost limitation approved by the commission for the pilot program.
The pilot program seeks to minimize overall costs and maximize overall benefits.
The pilot program does not unfairly compete with nonutility enterprises as required under Section 740.3.
The pilot program includes performance accountability measures.
The pilot program is in the interests of ratepayers, as defined in Section 740.8.
Charging stations installed pursuant to a pilot program approved by the commission pursuant to this section shall be installed and maintained by the utility workforce, or by workers who are paid the prevailing wage for all program-related work. The Director of Industrial Relations shall determine the prevailing wage in accordance with the standards set forth in Article 2 (commencing with Section 1770) of Chapter 1 of Part 7 of Division 2 of the Labor Code. A nonutility enterprise installing or maintaining charging stations and infrastructure pursuant to a pilot program approved by the commission shall submit wage schedules to the commission as part of its application and shall make all payroll records available to the commission for enforcement purposes pursuant to this part. Certified payrolls submitted to the commission shall be public records.
A school facility or other educational institution receiving charging stations pursuant to the approved pilot program shall participate in a time-variant rate approved by the commission. A school district, county office of education, private school, or other educational institution may require users of the charging stations to pay electricity costs.
An electrical corporation shall prioritize in its proposal school facilities and other educational institutions located in disadvantaged communities. For these purposes, “disadvantaged communities” means communities identified by the California Environmental Protection Agency pursuant to the Greenhouse Gas Reduction Fund Investment Plan and Communities Revitalization Act (Chapter 4.1 (commencing with Section 39710) of Part 2 of Division 26 of the Health and Safety Code).
Participation in the approved pilot program shall not prevent a school district, county office of education, private school, or other educational institution from participating in other transportation electrification programs. After a school district, county office of education, private school, or other educational institution has participated in the program for eight years, the school district, county office of education, private school, or other educational institution may cease participation in the pilot program and request removal of the charging station by providing 180-day notice to the electrical corporation.
By July 30, 2018, in consultation with the Department of Parks and Recreation, Public Utilities Commission, Energy Commission, and State Air Resources Board, each electrical corporation may file with the commission a pilot program proposal for the installation of electrical grid integrated charging stations at state parks and beaches within its service territory. By December 31, 2018, the commission shall review, modify if appropriate, and decide whether to approve a pilot program proposal filed by an electrical corporation. The Department of Parks and Recreation shall determine which state parks or beaches are suitable for charging stations.
The approved pilot program shall include a reasonable mechanism for cost recovery by an electrical corporation if the commission finds all of the following are true:
The costs to be recovered are consistent with a cost limitation approved by the commission for the pilot program.
The pilot program seeks to minimize overall costs and maximize overall benefits.
The pilot program does not unfairly compete with nonutility enterprises as required under Section 740.3.
The pilot program includes performance accountability measures for the electrical corporation or, for charging equipment installed and maintained by a nonutility enterprise, performance accountability measures for the nonutility enterprise.
The pilot program is in the interests of ratepayers, as defined in Section 740.8.
Charging stations installed pursuant to a pilot program approved by the commission pursuant to this section shall be installed and maintained by the utility workforce, or by workers who are paid the prevailing wage for all program-related work. The Director of Industrial Relations shall determine the prevailing wage in accordance with the standards set forth in Article 2 (commencing with Section 1770) of Chapter 1 of Part 7 of Division 2 of the Labor Code. A nonutility enterprise installing or maintaining charging equipment pursuant to a pilot program approved by the commission shall submit wage schedules to the commission as part of its application and shall make all payroll records available to the commission for enforcement purposes pursuant to this part. Certified payrolls submitted to the commission shall be public records.
State parks and beaches receiving charging stations pursuant to the approved pilot program shall participate in a time-variant rate approved by the commission.
An electrical corporation shall prioritize in its proposal those state parks and beaches that serve residents of disadvantaged communities. For these purposes, “disadvantaged communities” means communities identified by the California Environmental Protection Agency pursuant to the Greenhouse Gas Reduction Fund Investment Plan and Communities Revitalization Act (Chapter 4.1 (commencing with Section 39710) of Part 2 of Division 26 of the Health and Safety Code).
Except for costs incurred in determining park and beach suitability pursuant to subdivision (a) and potential liability under the Government Claims Act (Division 3.6 (commencing with Section 810) of Title 1 of the Government Code), the Department of Parks and Recreation shall not be required to incur any costs or liability related to the installation, use, or maintenance of the charging stations for the pilot program’s duration.
The commission shall consider, in an existing proceeding, all of the following:
Facilitating the development of technologies that promote grid integration, including technologies that provide submetering capabilities to residential charging stations, if the commission determines that these technologies and submetering capabilities are in the best interests of ratepayers.
Exploring policies that support the development of technologies and rate strategies that can reduce the effects of demand charges on electric vehicle drivers and fleets, and help accelerate the adoption of electric vehicles.
Adopting a tariff specific to heavy-duty electric vehicle fleets or electric trucks and buses that encourages the use of charging stations when there is excess grid capacity.
For purposes of this section, “charging station” means the removable equipment that provides alternating or direct current to the battery electric vehicle or plug-in hybrid electric vehicle, but does not include the supporting charging infrastructure, such as wiring, conduit, and electric panels.
The Legislature finds and declares all of the following:
State policy incentivizes and encourages the increased use of electric vehicles, and relies, in part, on the ratepayers of electrical corporations to fund policies intended to increase the usage of electric vehicles.
Changes in electrical demand and generation have created escalating peak and low periods of electrical supply and demand, and the cost of wholesale electricity and electricity delivery during peak demand periods is typically greater than during other periods.
It is feasible and practicable to adjust the period during which an electric vehicle charges, in part or in full, to reduce its cost impact during periods of peak demand or grid congestion, to utilize available renewable electric generation, to avoid curtailments of renewable electric generation, and to provide reliability services.
Time-of-use rates for customers with electric vehicles can reduce costs or mitigate cost increases for all ratepayers due to increased usage of electric vehicles by incentivizing electric vehicle charging at periods of low demand and low grid congestion.
It is, therefore, the policy of the state and the intent of the Legislature to maximize net ratepayer and grid benefits from transportation electrification and reduce costs or mitigate cost increases for all ratepayers due to increased usage of electric vehicles by accelerating electric vehicle grid integration and by ensuring that any investments in transportation electrification do not foreclose the electric vehicle grid integration potential of these investments.
For purposes of this section, “electric vehicle grid integration” means any method of altering the time, charging level, or location at which grid-connected electric vehicles charge or discharge, in a manner that optimizes plug-in electric vehicle interaction with the electrical grid and provides net benefits to ratepayers by doing any of the following:
Increasing electrical grid asset utilization.
Avoiding otherwise necessary distribution infrastructure upgrades.
Integrating renewable energy resources.
Reducing the cost of electricity supply.
Offering reliability services consistent with Section 380 or the Independent System Operator tariff.
Electric vehicle grid integration strategies shall not require the use of any specific technology.
Electric vehicle grid integration may be achieved using multiple strategies, including, but not limited to, the adoption of an electrical rate design, a technology, or a customer service, if that adoption helps provide net benefits to ratepayers pursuant to paragraph (1).
The commission may adopt a revised definition for “electric vehicle grid integration” through a new or existing proceeding to replace the definition in paragraph (1). Any revised definition of “electric vehicle grid integration” adopted by the commission shall be applicable to load-serving entities, as defined in Section 380.
By December 31, 2020, in an existing proceeding, the commission shall establish strategies and quantifiable metrics to maximize the use of feasible and cost-effective electric vehicle grid integration by January 1, 2030, consistent with all of the following:
The commission shall consider incorporating the National Institute of Standards and Technology’s reliability and cybersecurity protocols, or other equally protective or more protective cybersecurity protocols, into the electric vehicle grid integration strategies.
As part of each local publicly owned electric utility’s integrated resource plan update adopted on and after January 1, 2020, pursuant to Section 9621, the local publicly owned electric utility shall consider both of the following:
In carrying out its responsibilities pertaining to transportation electrification, including, but not limited to, pursuant to Sections 740.2, 740.3, 740.8, 740.12, 740.13, and 740.14, the commission shall reference the electric vehicle grid integration strategies established pursuant to subdivision (c) in relevant ongoing and subsequent proceedings that address issues of transportation electrification in any part and shall identify how programs and investments that the commission may approve will advance the achievement of the strategies.
In executing its responsibilities on transportation electrification, including, but not limited to, pursuant to Sections 740.2, 740.3, 740.8, 740.12, 740.13, and 740.14, the commission shall consider how, or if, electric vehicle grid integration can mitigate any generation, transmission, or distribution costs, or increase the economic, social, or environmental benefits associated with transportation electrification, and shall not foreclose future utilization of electric vehicle grid integration.
Each community choice aggregator shall, one year after the commission establishes electric vehicle grid integration strategies pursuant to subdivision (c), report annually to the commission describing how its current and planned programs, rates, and investments in transportation electrification are expected to further the electric vehicle grid integration strategies.
Each electrical corporation shall, in each of its applications to the commission for transportation electrification programs and investments filed pursuant to Section 740.12, quantify how the investments described in the application are expected to further the electric vehicle grid integration strategies adopted pursuant to subdivision (c).
Each electrical corporation that files an application for programs and investments to accelerate widespread transportation electrification pursuant to Section 740.12 shall, in each of its load research report compliance filings or alternative compliance filings submitted to the commission, report the electrical corporation’s annual measurable progress in furthering the electric vehicle grid integration strategies adopted pursuant to subdivision (c).
The commission shall, in an existing proceeding, review each load-serving entity’s annual measurable progress in furthering the electric vehicle grid integration strategies adopted pursuant to subdivision (c), and may, if appropriate, issue recommendations to ensure reasonable progress toward achieving vehicle grid integration.
Nothing in this section authorizes a delay of any new rate or program for electric vehicle charging or electric vehicle grid integration as to which consideration or approval is pending before the commission on or before January 1, 2020.
As regards electrical corporations, this section shall only apply to electrical corporations that are required to file an integrated resource plan pursuant to Section 454.52.
The purpose of this section is to require the commission to review, modify, if appropriate, and decide whether to approve, two pending (as of July 1, 2020) transportation electrification infrastructure applications, based on previously approved activities, that are designed to advance California’s goal of widespread transportation electrification, and to require the commission to extend its prior approvals of transportation electrification programs and investments so that they will be replicated and continued. These commission decisions will have the effect of continuing to build out California’s transportation electrification infrastructure, improve air quality, reduce emissions of greenhouse gases, create jobs, and put downward pressure on rates. Nothing in this section is intended to preclude the commission from adopting additional transportation electrification programs and investments.
On or before March 1, 2021, the commission shall issue decisions concerning Application 18-06-015 (June 26, 2018) Application of Southern California Edison Company (U338E) for Approval of its Charge Ready 2 Infrastructure and Market Education Programs and Application 19-10-012 (October 28, 2019) Application Of San Diego Gas & Electric Company (U902E) To Extend And Modify The Power Your Drive Pilot Approved By Decision 16-01-045.
The purpose of this section is to change the commission practice of authorizing the electrical distribution infrastructure located on the utility side of the customer meter needed to charge electric vehicles on a case-by-case basis to a practice of considering that infrastructure and associated design, engineering, and construction work as core utility business, treated the same as other distribution infrastructure authorized on an ongoing basis in the electrical corporation’s general rate case. The commission should not relegate charging electric vehicles to a lower status than any other use of electricity for which the electrical corporation provides distribution infrastructure. The commission shall continue to require each electrical corporation to provide an accurate and full accounting of all expenses related to electrical distribution infrastructure as it relates to this section, and apply appropriate penalties to the extent an electrical corporation is not accurately tracking all expenses.
For purposes of this section, the term “electrical distribution infrastructure” shall include poles, vaults, service drops, transformers, mounting pads, trenching, conduit, wire, cable, meters, other equipment as necessary, and associated engineering and civil construction work.
Not later than February 28, 2021, each electrical corporation shall file an advice letter pursuant to Section 5.1 of General Order 96-B, for, and not later than June 30, 2021, the commission shall approve, a new tariff or rule that authorizes each electrical corporation to design and deploy all electrical distribution infrastructure on the utility side of the customer’s meter for all customers installing separately metered infrastructure to support charging stations, other than those in single-family residences. The advice letter and the commission’s approval shall provide that costs incurred by the electrical corporation between January 1, 2021, and the implementation date of rates approved in the next general rate case decision for that electrical corporation shall be tracked in a memorandum account and recovered, subject to a reasonableness review, in the decision adopting the next general rate case revenue requirement for that electrical corporation. Each electrical corporation shall recover its subsequent revenue requirement for this work through periodic general rate case proceedings. In those proceedings, the costs shall be treated like those costs incurred for other necessary distribution infrastructure. The new tariff shall replace the line extension rules currently used (as of July 1, 2020) and any customer allowances established shall be based on the full useful life of the electrical distribution infrastructure. The commission may revise the policy described in subdivision (a) and this subdivision after the completion of the general rate case cycle of the electrical corporation following the one during which the advice letter was filed if a determination is made that a change in the policy is necessary to ensure just and reasonable rates for ratepayers.
For purposes of this subdivision, the following terms have the following meanings:
“Basic charging arrangements” means Level 1 and Level 2 charging in accordance with the SAE J1772 standard, or a replacement standard that the commission determines to be appropriate.
“D. 11-07-029” means commission Decision 11-07-029 (July 14, 2011) Phase 2 Decision Establishing Policies to Overcome Barriers to Electric Vehicle Deployment and Complying with Section 740.2 of the Public Utilities Code, made in Rulemaking 09-08-009 (August 20, 2009) Order Instituting Rulemaking on the Commission’s Own Motion to Consider Alternative-Fueled Vehicle Tariffs, Infrastructure and Policies to Support California’s Greenhouse Gas Emissions Reduction Goals.
“D. 13-06-014” means commission Decision 13-06-014 (June 27, 2013) Decision Authorizing Short-Term Extension of Limited Provisions Regarding Electric Tariff Rules 15 and 16, made in Rulemaking 09-08-009.
“D. 16-06-011” means commission Decision 16-06-011 (June 9, 2016) Decision Authorizing Further Extension of the Interim Policy Regarding Electric Tariff Rules 15 and 16, made in Rulemaking 13-11-007 (November 14, 2013) Order Instituting Rulemaking to Consider Alternative-Fueled Vehicle Programs, Tariffs, and Policies.
“D. 16-11-005” means commission Decision 16-11-005 (November 10, 2016) Decision Making Small Electrical Corporations Respondents to this Rulemaking, made in Rulemaking 13-11-007.
“PEV charging” means plug-in electric vehicle charging.
“R. 18-12-066” means commission Rulemaking 18-12-006 (December 13, 2018) Order Instituting Rulemaking to Continue the Development of Rates and Infrastructure for Vehicle Electrification.
In supervising the alternative-fueled vehicle program, or vehicle electrification program, of an electrical corporation, the commission shall allow the residential service facility upgrade costs incurred as a result of the adoption of home-based electric vehicle charging for basic charging arrangements that exceed the utility’s Electric Tariff Rule 15 (distribution line extensions) and Rule 16 (service line extensions) allowances to be treated as a common facility cost, to be recovered from all residential ratepayers.
It is the intent of the Legislature that the interim policy, known as the Common Treatment for Excess PEV Charging, initially adopted with respect to the state’s three largest electrical corporations in D. 11-07-029, extended in D. 13-06-014, extended again in D. 16-06-011, expanded to include the state’s three smaller electrical corporations in D. 16-11-005, and further extended by the Assigned Commissioner’s Scoping Memorandum and Ruling entered May 2, 2019, and by the order of the Administrative Law Judge entered December 13, 2019 in R. 18-12-066, shall be the policy applied by the commission, and may be revised by the commission after the completion of the electrical corporation’s general rate case cycle in effect on January 1, 2021, if a determination is made that a change in the policy is necessary to ensure just and reasonable rates for ratepayers.
The commission, the Energy Commission, and the State Air Resources Board shall require that all electric vehicle charging infrastructure and equipment located on the customer side of the electrical meter that is funded or authorized, in whole or in part, by those state entities shall be installed by a contractor with the appropriate license classification, as determined by the Contractors’ State License Board, and at least one electrician on each crew, at any given time, who holds an Electric Vehicle Infrastructure Training Program certification.
The commission, the Energy Commission, and the State Air Resources Board shall require that projects funded or authorized, in whole or in part, by those state entities, that install a charging port supplying 25 kilowatts or more to a vehicle have at least 25 percent of the total electricians working on the crew for the project, at any given time, who hold Electric Vehicle Infrastructure Training Program certification.
One member of each crew may be both the contractor and an Electric Vehicle Infrastructure Training Program certified electrician.
Subdivision (a) does not apply to any of the following:
Electric vehicle charging infrastructure installed by employees of an electrical corporation or local publicly owned electric utility.
Electric vehicle charging infrastructure funded by moneys derived from credits generated from the Low Carbon Fuel Standard Program (Subarticle 7 (commencing with Section 95480) of Article 4 of Subchapter 10 of Chapter 1 of Division 3 of Title 17 of the California Code of Regulations).
Single-family home residential electric vehicle chargers that can use an existing 208/240-volt outlet.
An electrician apprenticeship program approved by the Division of Apprenticeship Standards or a continuing education provider approved by the Department of Industrial Relations to provide training to electricians may provide apprentices with Electric Vehicle Infrastructure Training Program training with their own Electric Vehicle Infrastructure Training Program certified instructors. The Electric Vehicle Infrastructure Training Program certification exam shall be administered by the Electric Vehicle Infrastructure Training Program.
The Electric Vehicle Infrastructure Training Program shall provide copies of its Electric Vehicle Infrastructure Training Program curriculum and any updates or revisions to any Electric Vehicle Infrastructure Training Program certified instructor within 30 days of a request or when the curriculum is updated.
No later than May 1, 2021, and periodically thereafter, the Energy Commission, in consultation with the commission, shall conduct joint public workshops to determine if the Electric Vehicle Infrastructure Training Program curriculum and testing should be supplemented to include updated or additional topics necessary to ensure safe installation of charging infrastructure. In conducting the workshops, the Energy Commission shall seek public input from entities, including from labor groups, electrical contractors, electric vehicle service providers, and the Electric Vehicle Infrastructure Training Program. The Energy Commission’s determination shall consider cost, cost effectiveness, consensus in the industry, market penetration of new technologies, and the availability of supplemental training from other sources. The Energy Commission’s determination shall be reasonable, supplemental, and shall maintain the existing scope and rigor of the Electric Vehicle Infrastructure Training Program curriculum and testing. The Energy Commission shall not require the Electric Vehicle Infrastructure Training Program to provide product-specific training. If the Energy Commission determines that the Electric Vehicle Infrastructure Training Program should be supplemented, the Electric Vehicle Infrastructure Training Program shall incorporate this supplemental curriculum and testing within six months of final action by the Energy Commission, unless additional time is reasonably required. The Electric Vehicle Infrastructure Training Program may incorporate supplemental curriculum and testing either as a California-specific supplement to the Electric Vehicle Infrastructure Training Program certification or as part of the standard Electric Vehicle Infrastructure Training Program certification.
As part of the first workshop pursuant to paragraph (1), the Energy Commission, in consultation with the commission, shall evaluate whether additional training and testing is needed to safely install direct current fast charging infrastructure, high voltage charging infrastructure, or charging infrastructure for medium- and heavy-duty vehicles.
Electric Vehicle Infrastructure Training Program training shall qualify as part of the 32 hours of further electrical education that a California certified electrician is required to complete every three years pursuant to Section 291.5 of Title 8 of the California Code of Regulations.
Except as provided in subdivision (h), subdivision (a) applies to all work performed on or after January 1, 2022, pursuant to any decision made on or after January 1, 2021, by the commission, the Energy Commission, or the State Air Resources Board.
Subdivision (a) applies to any work performed after January 1, 2021, pursuant to decisions described in subdivision (a) of Section 740.18.
Subdivision (a) does not apply to electric vehicle charging infrastructure and equipment that is subject to any agreements or contracts with any public agency entered into prior to January 1, 2021, even if it is funded or authorized after January 1, 2021.
Not later than March 1, 2021, the Electric Vehicle Infrastructure Training Program shall offer Electric Vehicle Infrastructure Training Program courses in an online format. The online format shall remain available through December 31, 2024.
Each electrical corporation, as part of its distribution planning process, shall consider the fleet data produced by the Energy Commission pursuant to Section 25328 of the Public Resources Code, and other available data, to facilitate the readiness of their distribution systems to support the level of electric vehicle charging anticipated in its service territory by Executive Orders No. B-48-18 and N-79-20, the Energy Commission’s integrated energy policy report adopted pursuant to Section 25302 of the Public Resources Code, the Energy Commission’s assessment prepared pursuant to Section 25229 of the Public Resources Code, State Air Resources Board regulations, air quality management plans, regional seaport plans, regional transportation plans, and sustainable communities strategies.
In its general rate case, each electrical corporation shall identify how investments made pursuant to this section will support electric vehicle deployment within its service territory. Each electrical corporation shall consider the electric vehicle deployment goals in Executive Orders No. B-48-18 and N-79-20, the Energy Commission’s integrated energy policy report adopted pursuant to Section 25302 of the Public Resources Code, and the Energy Commission’s assessment prepared pursuant to Section 25229 of the Public Resources Code. Each electrical corporation may also consider relevant State Air Resources Board regulations, air quality management plans, regional seaport plans, regional transportation plans, and sustainable communities strategies.
In reviewing electrical corporation proposals to meet the requirements of subdivision (a), the commission shall ensure proposed investments are consistent with preparing the electrical grid for the achievement of the state’s goals and regulations identified in subdivision (a).
For purposes of this section, “utility” means an electrical corporation or a gas corporation.
As a part of its general rate case, a utility shall report to the commission all of the following:
For any work category, the amount authorized for the test year in the last general rate case and the amount authorized based on escalation for the last year of the prior general rate case.
For any work category, the actual recorded amounts during the past 10 years split between labor and nonlabor costs and between capital and expenses.
For any asset repair, installation, or replacement work, the number of units installed, repaired, or replaced during the past 10 years.
The authorized and actual rate of return and return on equity for the past 10 years.
For distribution capacity, all of the following:
The projects included in the forecast submitted in the prior general rate case.
The projects actually conducted so far in the prior general rate case or planned to be started during the prior general rate case cycle.
Which projects included in the forecast submitted in the prior general rate case are included in the forecast for the pending general rate case.
Which projects included in the prior general rate case have been canceled or indefinitely delayed and the reasons for the cancellation or delay.
A breakdown by program of any capital costs included in the pending general rate case that exceed previously authorized levels or that have not been previously found to be reasonable.
Every owner or operator of telephones available for public use, other than a telephone corporation, that accept any form of payment which, as part of the service furnished, provides operator-assisted services by other than a telephone corporation having tariff schedules on file with the commission providing for the furnishing of operator-assisted services, shall cause to be posted on or near the telephone equipment so as to be easily seen by telephone customers all of the following information:
The name of the provider of operator-assisted services and a toll-free telephone number for contacting that provider.
The applicable charges for each available operator-assisted service.
That the provider of operator-assisted services will respond to inquiries concerning the terms and conditions of any available service.
That surcharges may apply to operator-assisted and calling card calls.
That card-activated calls, calls activated by any other payment device, or calls that may be charged to a card by giving a card number to an operator may cost more than coin-activated calls.
The local rates for nonoperator-assisted calls.
Every owner or operator of telephones available for public use, other than a telephone corporation, that accept any form of payment which, as part of the service furnished, provides operator-assisted services by other than a telephone corporation having tariff schedules on file with the commission providing for the furnishing of operator-assisted services, shall:
Identify itself, audibly and distinctly, to the consumer at the beginning of each telephone call and before the consumer incurs any charge for the call.
Permit the consumer to terminate the telephone call before the call is connected.
At no charge, disclose to the consumer, immediately after the number to be called is entered or given to an operator, a quotation of its complete rates and charges for the call.
This section shall become operative on January 1, 2015.
Every nonpublic utility provider of telephone services, including, but not limited to, a hotel, motel, hospital, or university, which imposes charges on users of the services and which, as part of the service furnished, provides operator-assisted services by other than a telephone corporation having tariff schedules on file with the commission providing for the furnishing of operator-assisted services shall cause to be posted on or near the telephone equipment so as to be easily seen by users of the service all of the following information:
The name of the provider of operator-assisted services and a toll-free telephone number for contacting that provider.
The applicable charges for each available operator-assisted service.
That the provider of operator-assisted services will respond to inquiries concerning the terms and conditions of any available service.
No nonpublic utility provider of telephone services, including, but not limited to, a hotel, motel, hospital, university, or similar place of temporary accommodation owning or operating message switching or billing equipment solely for the purpose of reselling services provided by a telephone corporation to its patients or guests is required to file or maintain tariff schedules.
No such nonpublic utility provider of telephone services which provides service to hospital patients may charge more for any nontoll telephone call than the maximum rate of charge authorized by the commission for a nontoll call placed from a coin-activated telephone owned or operated by other than a telephone corporation plus twenty-five cents ($0.25).
No such nonpublic utility provider of telephone services which provides service to hospital patients may charge more for any toll telephone call than the sum of all of the following:
The applicable tariff rate or charge of the telephone corporation whose service is resold for that telephone call.
The surcharge or surcharges, if any, applicable to that call if placed from a coin-activated telephone owned or operated by the telephone corporation within whose service area the nonpublic utility provider of telephone services is located, unless that surcharge is included in the tariff rate or charge for that call.
Twenty-five cents ($0.25).
No such nonpublic utility provider of telephone services may make any charge for any uncompleted telephone call unless notice pursuant to subdivision (e) is provided specifying the circumstances under which a charge will be made for an uncompleted call.
Every nonpublic utility provider of telephone services shall display or post on or near the telephone equipment so as to be easily seen by telephone users a notice of all of the following:
The charges applicable to all of the available telephone services. These charges shall be separately stated, and shall include, but not be limited to, the following information:
Individual customer telephone service activation deposits or fees, if any.
Charges for use of telephone services, irrespective of whether a call is completed.
That these charges are consistent with this section, if applicable.
The telephone number of the Consumer Affairs Division of the commission to which questions or complaints may be directed.
Subdivision (e) does not require separate notices for multiple or extension telephones having the same telephone extension number.
This section does not require any such nonpublic utility provider of telephone services to make any charge for the furnishing of any telephone service, and this section does not apply to any such provider that makes no charge for telephone services furnished. This section does not constitute any such provider a telephone corporation or otherwise subject it to regulation by the commission as a public utility.
The commission shall, by rule or order, adopt and enforce operating requirements applicable to operator-assisted telephone services, whether furnished by a telephone corporation or other than a telephone corporation, for nonpublic utility providers of telephone services, including, but not limited to, hotels, motels, hospitals, universities, and similar places of temporary accommodation owning or operating message switching or billing equipment solely for the purpose of reselling services provided by a telephone corporation to its patients or guests. These operating requirements shall include, but not be limited to, all of the following:
That there be displayed or posted on or near the telephone equipment so as to be easily seen by telephone users a notice stating the identity of the nonpublic utility provider of the telephone services; the method for obtaining the rates, terms, or conditions of operator-assisted services; the operator-assisted services provider’s procedures for handling complaints; the means by which the telephone user may gain access to other providers of operator-assisted services; and the means by which the telephone user may gain access to the services of the telephone corporation operating within the service area within which the telephone services of the nonpublic utility provider are furnished. The notice shall also provide the telephone number of the Consumer Affairs Division of the commission to which questions or complaints may be directed.
That, when contacted for service by the telephone user, the operator-assisted services provider orally identify itself by name prior to the connection of the telephone call or the commencement of any charges.
That the telephone equipment permit access by the telephone user to any other provider of operator-assisted services generally available in the service area.
Any other operating requirement determined necessary and in the public interest by the commission.
The commission shall, by rule or order, adopt and enforce operating requirements for telephones available for public use that accept any form of payment and that are owned or operated by corporations or persons other than telephone corporations. These requirements shall include, but are not limited to, all of the following:
A requirement that the telephone corporation furnishing service to the corporation or person owning or operating a telephone that accepts any form of payment terminate service for any violation of the commission’s rules or orders or of this section, upon a determination by the commission that the violation was a significant or repeated violation. Any determination by the commission leading to a termination of service shall be made in accordance with commission rules or orders adopted pursuant to this subdivision.
A requirement that every telephone permit a caller to be connected with the operator personnel of any telephone corporation authorized by the commission to operate within a service area by dialing the numeral “0” and with the emergency services switchboard reached by dialing the numerals “911” without insertion of any coin or without any other form of payment.
A requirement that every telephone contain instructions for both local and long distance dialing, the name of the owner or operator of the telephone, and the telephone number of that owner or operator to which complaints can be made.
A requirement that every telephone display its telephone number or other identification number, as determined by the commission, and the address at which the telephone is located, on the telephone in a place where that information may be seen by a person using the telephone.
The commission shall require every telephone corporation that publishes a directory of subscribers to include in that directory information comprising the substance of this section and the rules and orders of the commission adopted pursuant to this section.
This section shall become operative on January 1, 2015.
The commission shall, by rule or order, adopt and enforce operating requirements for every corporation or person, other than a telephone corporation, which, as part of the services furnished, furnishes operator-assisted services by other than a telephone corporation having tariff schedules on file with the commission. These requirements shall include, but not be limited to, a requirement that furnishing these operator-assisted services for telephone calls within a service area is prohibited unless the commission, after instituting a proceeding for the purpose, finds and determines that to permit these operator-assisted services is in the public interest.
The commission shall require every telephone corporation which publishes a directory of subscribers to include in that directory information comprising the substance of this section and the rules and orders of the commission adopted pursuant to this section.
The commission shall, by rule or order, adopt and enforce an operating requirement for coin-activated and credit card-activated telephones available for public use, whether owned by telephone corporations or persons other than telephone corporations, which requires that every telephone display a notice that surcharges may apply to operator-assisted and calling card calls. The required signage shall be phased in over a period of two years beginning on January 1, 1993. A sticker with the necessary notification may be used as an interim measure until January 1, 1995.
No telephone corporation which operates within a service area shall provide billing and collection services for either of the following:
Any telephone corporation which has not obtained a certificate of public convenience and necessity but is required to do so.
Any person or corporation providing billing and collection services for any telephone corporation which has not obtained a certificate of public convenience and necessity but is required to do so.
Subdivision (a) does not prohibit a telephone corporation operating within a service area from providing billing and collection services for a provider of enhanced service, as defined by Section 64.702 of Title 47 of the Code of Federal Regulations.
No telephone corporation which provides billing and collection services for any call placed by a subscriber of the telephone corporation from a coin-activated telephone available for public use owned or operated by other than a telephone corporation shall transmit any charge which is in excess of the maximum tariff rate or charge for that call placed from that telephone, as determined by the commission. Any reasonable cost incurred by the telephone corporation in verifying any such charge may be included in the fees or charges for conducting the billing and collection services. The commission shall adopt rules and procedures for the implementation of this subdivision.
As used in this section, “steel producer” means a producer of steel products in California which in 1981 or any subsequent year produced at least 75,000 tons of rolled or finished steel and which has a maximum demand for electricity of 4,000 kilowatts or more at one plant location. Any steel producer which transfers any substantial amount of employment from its facilities in this state to any out-of-state facility or otherwise substantially reduces employment at its facilities in this state below the June 30, 1985, level, or fails to maintain and make reasonable and prudent investments in its facilities, as determined by the commission, is ineligible for any electric rate established pursuant to this section.
As used in this section, “frozen food processor” means a corporation or person engaged in the processing of food in California, which food is classified according to the Standard Industrial Classification Manual, 1972, in Industry No. 2037 and Industry No. 2038 of Group 203, of Food and Kindred Products Major Group 20, as specified in Section 2900.3 of Title 7 of the Code of Federal Regulations. “Processing of food” includes the postprocessing storage of frozen food in a warehouse, or other facility, until the frozen food leaves the control or responsibility of the frozen food processor or until the frozen food processor no longer has an obligation to store the food.
As used in this section, “system average rate” means total jurisdictional revenues of the electrical corporation divided by total jurisdictional sales.
Every electrical corporation furnishing electricity to a steel producer, frozen food processor, or other heavy-industry customer, as determined and specified by the electrical corporation, shall prepare and file tariffs providing rates which shall be lower than the system average rate and take into consideration all of the following:
Specific service requirements of individual customers, including, but not limited to, reliability, interruptability, quantity of use, and requirements of voltage.
Incentives to achieve conservation, improvements in efficiency, and time-of-day load shifting.
Implementation at the option of the customer.
Cost of service.
The commission shall consider and approve tariffs which shall be consistent with this section and which shall be in effect on and after July 1, 1992.
The commission may approve contracts between an electrical corporation and its heavy industrial customers as determined by the electrical corporation, of not more than ten years’ duration, in which the electrical corporation buys from the heavy industrial customer the right to interrupt the customer’s service on short notice, as determined by the commission. The payment mechanism may include a discounted rate for service. In approving and determining the reasonableness of these contracts, the commission may consider, among other things, the price paid by the electrical corporation for the right to interrupt, the value of that right to the utility system and its ratepayers, and the benefits to the ratepayers and the people of the state of retaining heavy industrial customers. Throughout the term of any of these contracts, the commission shall have the right to amend the contract. Every contract subject to this subdivision shall include a provision indicating that the contract is subject to amendment by the commission as provided in this subdivision. This subdivision does not supersede the requirement of subdivision (d) that the commission establish a heavy industrial tariff.
Beginning January 15, 2002, and at least once monthly thereafter, an electrical corporation shall notify each air pollution control district and air quality management district of the name and address of each entity within the district’s boundaries within the electrical corporation’s control or service area with whom the electrical corporation enters into an interruptible service contract or similar arrangement.
For the purposes of this section, “interruptible service contract or similar arrangement” means any arrangement in which a nonresidential electrical customer agrees to reduce or consider reducing its electrical consumption during periods of peak demand or at the request of the Independent System Operator in exchange for compensation, or for assurances not to be blacked out or other similar nonmonetary assurances.
The local air pollution control district or air quality management district shall maintain in a confidential manner the information received pursuant to this section. However, nothing in this subdivision shall affect the applicability of Division 10 (commencing with Section 7920.000) of Title 1 of the Government Code, or of any other similar open records statute or ordinance, to information provided pursuant to this section.
As used in this section, “agricultural producer” means any person or corporation whose principal purpose is the agrarian production of food or fiber.
Every electrical corporation furnishing electricity to an agricultural producer shall, in addition to its regular service, prepare and file tariffs providing, where economically and technologically feasible, for optional alternative interruptible service to any agricultural producer upon reasonable notice to the agricultural producer consistent with safety of operations by the agricultural producer and providing for limits upon the frequency and duration of interruption of service which the commission finds are reasonable in relation to the needs of the electrical corporation for reductions in load to meet system peak requirements and the burdens imposed upon the agricultural producer of reducing its operations during periods of interruption of electrical service. The commission shall establish the rate for this service at an appropriate discount from the system average rate, which shall be not less than the cost of furnishing this service.
Every electrical corporation furnishing electricity to an agricultural producer shall, in addition to its regular service, prepare and file tariffs providing for an optional off-peak demand service, including the availability of time-differentiating meters or other measurement devices, to any agricultural producer providing for furnishing electricity to the agricultural producer during periods of off-peak demand and which the commission finds are reasonable in relation to the needs of the electrical corporation for reduction in demand to meet system peak requirements and the burdens imposed upon the agricultural producer of scheduling its operations to coincide with the periods of off-peak demand. The off-peak demand service tariff shall be composed of a two-part time differentiated schedule consisting of on- and off-peak rates. The commission shall establish the rate for this service at an appropriate discount from the system average rate, which shall be not less than the cost of furnishing this service.
Notwithstanding any other provision of law, the Public Utilities Commission shall, as soon as is practicable after the operative date of the act adding this section, require every electrical corporation which furnishes electricity to an agricultural producer to provide, in accordance with the requirements of subdivision (c), citrus and avocado producers with an electrical energy payment deferral program related to the production of citrus and avocado crops.
For the purposes of this section, “agricultural producer” shall be as defined in subdivision (a) of Section 744.
Notwithstanding any other provision of law, upon verification by the agricultural producer of freeze-related crop losses of not less than 50 percent, the electrical corporation shall provide the electrical energy payment deferral program referenced in subdivision (a). For the purposes of this subdivision, the electrical corporation shall accept the original or a true photocopy of any of the following as verification of crop losses:
A statement from a packing house or handler. A person who exercises managing control in a packing house shall provide at least one of the documents set forth in paragraphs 2 to 5, inclusive, in addition to, or in place of, the document set forth in this paragraph.
A statement from a farm adviser of the University of California.
A statement from the county agricultural commissioner.
A statement of insurance adjustment.
A calamity claim to the county tax assessor.
For the purposes of this section, “deferral period” shall mean June 1, 1991, to March 31, 1992, inclusive. Electricity bills incurred by agricultural producers during the deferral period shall be eligible for deferral pursuant to this section.
Deferral programs under this section shall be developed on an individual basis between the electrical energy corporation and the eligible agricultural producers. These deferral programs shall allow eligible agricultural producers, at their option, to defer, without incurring interest charges, up to 50 percent of each electricity bill incurred during the deferral period on accounts or amounts attributable to the production of citrus or avocado crops.
At the end of the deferral period, participating agricultural producers shall keep each month’s charges current and pay the accrued deferrals in up to 18 equal monthly installment payments. To be eligible for the maximum 50 percent deferral and the maximum 18-month repayment period, an agricultural producer shall do all of the following:
Verify crop losses in accordance with subdivision (c).
Demonstrate, to the satisfaction of the electrical energy corporation, which accounts are, or which portion of the amount billed is, attributable to the production of citrus or avocado crops.
Pay, on or before the due date of each bill during the deferral period, at least 50 percent of the charges incurred on each bill.
The electrical energy corporation may require a security interest in crops, real property, or other security acceptable to the electrical energy corporation, as a condition of deferring payments pursuant to this section. Any deferral by the electrical energy corporation of one or more electricity bills pursuant to this section shall not constitute a waiver by the corporation of its authority to require security for amounts already deferred or subsequently deferred.
Each electrical energy corporation shall establish a balancing account to reflect the amounts of the deferrals and the costs of the payment deferral program. All of the costs of the payment deferral program, including, but not limited to, uncollectible amounts, interest, and administrative costs, shall be fully recovered from all customers of the electrical energy corporation.
For purposes of this section, “time-variant pricing” includes time-of-use rates, critical peak pricing, and real-time pricing, but does not include programs that provide customers with discounts from standard tariff rates as an incentive to reduce consumption at certain times, including peak time rebates.
The commission may authorize an electrical corporation to offer residential customers the option of receiving service pursuant to time-variant pricing and to participate in other demand response programs. The commission shall not establish a mandatory or default time-variant pricing tariff for any residential customer except as authorized in subdivision (c).
Beginning January 1, 2018, and subject to the commission making the findings required by subdivision (d), the commission may require or authorize an electrical corporation to employ default time-of-use rates for residential customers subject to all of the following:
Residential customers receiving a medical baseline allowance pursuant to subdivision (c) of Section 739, customers requesting third-party notification pursuant to subdivision (c) of Section 779.1, customers who the commission has ordered cannot be disconnected from service without an in-person visit from a utility representative (Decision 12-03-054 (March 22, 2012), Decision on Phase II Issues: Adoption of Practices to Reduce the Number of Gas and Electric Service Disconnections, Order 2 (b) at page 55), and other customers designated by the commission in its discretion shall not be subject to default time-of-use rates without their affirmative consent.
The commission shall ensure that any time-of-use rate schedule does not cause unreasonable hardship for senior citizens or economically vulnerable customers in hot climate zones.
The commission shall strive for time-of-use rate schedules that utilize time periods that are appropriate for at least the following five years.
A residential customer shall not be subject to a default time-of-use rate schedule unless that residential customer has been provided with not less than one year of interval usage data from an advanced meter and associated customer education and, following the passage of this period, is provided with no less than one year of bill protection during which the total amount paid by the residential customer for electric service shall not exceed the amount that would have been payable by the residential customer under that customer’s previous rate schedule.
Each electrical corporation shall provide each residential customer, not less than once per year, using a reasonable delivery method of the customer’s choosing, a summary of available tariff options with a calculation of expected annual bill impacts under each available tariff. The summary shall not be provided to customers who notify the utility that they choose not to receive the summary. The reasonable costs of providing this service shall be recovered in rates.
Residential customers have the option to not receive service pursuant to a time-of-use rate schedule and incur no additional charges as a result of the exercise of that option. Prohibited charges include, but are not limited to, administrative fees for switching away from time-of-use rates, hedging premiums that exceed any actual costs of hedging, and more than a proportional share of any discounts or other incentives paid to customers to increase participation in time-of-use rates. This prohibition on additional charges is not intended to ensure that a customer will necessarily experience a lower total bill as a result of the exercise of the option to not receive service pursuant to a time-of-use rate schedule.
The commission shall not require or authorize an electrical corporation to employ default time-of-use rates for residential customers unless it has first explicitly considered evidence addressing the extent to which hardship will be caused on either of the following:
The commission shall determine the appropriate ratemaking treatment for incentive compensation paid to officers or employees of an electrical corporation or gas corporation for incentive compensation that is linked to the stock price or financial performance of the electrical corporation or gas corporation.
It is the intent of the Legislature that the commission reduce rates for electricity and natural gas to the lowest amount possible.
Except for Golden State Energy, an electrical corporation or gas corporation shall not recover, through a rate approved by the commission, a fine or penalty.
Except as specified in subdivision (b), an electrical corporation or gas corporation shall not recover, through a rate approved by the commission, costs arising directly from new or additional activities expressly agreed to by the corporation, or any direct payment, fine, or penalty paid by the corporation, in a settlement agreement resolving a criminal or civil inquiry, investigation, or prosecution for a violation of law, conducted by the Attorney General or a district attorney, county counsel, city attorney, or city prosecutor, and in exchange for the inquiry, investigation, or prosecution to be terminated or concluded.
Notwithstanding subdivision (a), the commission shall only approve an electrical corporation or gas corporation to recover, through a rate, costs described in subdivision (a) if the commission determines that those costs were just and reasonably incurred.
For purposes of this section, all of the following definitions apply:
“Above-the-line account” means an account that contains expenses that a utility recovers from ratepayers, including an account that contains expenses that the utility used to calculate a revenue requirement request in its general rate case.
“Below-the-line account” means an account that contains expenses that a utility does not generally recover from ratepayers.
“Compensation” means salary, a bonus, benefits, or other consideration of any value.
“Covered business unit” means a division, department, or other organizational employee group within a utility that performs activities specified in subdivision (b).
“Expense” means a payment to an external entity, a cost incurred by a parent company or corporate affiliate and invoiced to a utility, and compensation paid to an employee of a utility.
“Political influence activity” means either of the following:
An activity for the purpose of directly or indirectly influencing any of the following:
The adoption, repeal, or modification of federal, state, regional, or local legislation, regulations, or ordinances.
(II) The election, recall, appointment, or removal of a public official or the adoption of initiatives or referenda.
(III) The approval, modification, or revocation of franchises of a utility.
(IV) Public opinion with respect to legislation, regulations, ordinances, elections, referenda, or rate setting of a utility.
Decisions of federal, state, regional, or local public officials.
Research, preparation, or any other activity undertaken for the purpose of supporting any activities specified in clause (i).
“Political influence activity” does not include any of the following:
An activity that is directly and necessarily related to appearances before regulatory or other governmental bodies in connection with the utility’s existing or proposed operations of the utility’s regulated system. Policies affecting the use of gaseous fuels or electricity are not directly and necessarily related to the utility’s existing or proposed operations.
An activity that is directly related to a commission-approved energy efficiency program or another commission-approved public purpose program if the participation of the utility has not otherwise been prohibited by the commission.
An activity that responds to a request by a legislative committee, the commission, or a government agency for technical information from the utility.
An activity required by applicable federal or state statute, or by order of a regulatory authority, and undertaken for the purpose of satisfying that statutory or regulatory requirement.
“Promotional advertising” means written, online, video, or audio communications that primarily build the public image of a utility and that is not required by the commission, including communications about the undergrounding of electrical lines or other actions that a utility may take in the future.
“Promotional advertising” does not include, except as specified in subparagraph (A), any of the following:
Public messages that the utility is directed to publish by a federal, state, or local agency.
Public messages that provide information on safety measures, emergency conditions, the conservation of energy as described in subdivision (b) of Section 796, rates, utility programs and services approved by the commission, or service interruptions, and that do not primarily build the public image of the utility.
Public messages providing necessary information to customers about specific actions the customers can take for their safety.
“Public official” means a decisionmaker within an administrative agency or legislative body at the local, regional, state, or federal level, or an executive officer at the local, regional, state, or federal level.
“Utility” means an electrical corporation or gas corporation.
“Utility affiliate” means an entity that is related to the utility as a subsidiary, parent, or sibling corporation, including by shareholding or other means of control.
“Vendor” means a person or business that provides goods and services.
Except as provided in subdivision (c), a utility shall not record to an above-the-line account, or otherwise recover from ratepayers, direct or indirect costs of any of the following:
Membership dues, sponsorships, or other contributions to an industry trade association, group, or related entity incorporated under Section 501 of the Internal Revenue Code of 1986, as amended, if any portion of those contributions support political influence activities or advertising. This paragraph does not apply to fees for professional licenses necessary for employee job duties.
Charitable giving, including contributions to an organization that qualified under Section 501(c)(3) or 501(c)(4) of the Internal Revenue Code of 1986, as amended.
Political influence activities.
Promotional advertising.
Payments to outside attorneys representing utilities in commission proceedings or experts testifying on behalf of, or otherwise supporting the participation by, utilities in commission proceedings that exceed the hourly rates that would be permitted for rate recovery under the commission’s intervenor compensation program.
Contributions to political candidates, political parties, campaign committees, issue committees, or independent expenditure committees, or other political expenses.
A cost, including marketing, administration, or customer service, for products or services not regulated by the commission.
Penalties or fines, including tax penalties or fines, issued against a utility.
Board of directors and officers liability insurance, and travel, lodging, food, or beverage expenses for a utility’s board of directors and officers or the board of directors and officers of a utility affiliate.
An owned, leased, or chartered aircraft for the utility’s board of directors and officers or the board of directors and officers of a utility affiliate.
Investor relations.
Subdivision (b) does not prohibit a utility from recording to an above-the-line account payments made pursuant to an agreement authorized by the National Labor Relations Act (29 U.S.C. Sec. 151 et seq.) or payments authorized by the federal National Labor Management Cooperation Act of 1978 (Public Law 95-524), and does not restrict any use permitted by federal law of moneys paid pursuant to those federal acts.
On or before May 31, 2026, and annually thereafter, each utility shall report, as part of the statement required under General Order 77-M, all of the following information from the previous calendar year to ensure the utility’s compliance with this section:
A list of covered business units of the utility. Except as specified in clause (ii), for each covered business unit, the report shall contain all of the following:
A list of each employee’s name and job title.
(II) A job description of each listed employee sufficient to describe the employee’s responsibilities.
(III) The total annual compensation provided to each listed employee.
(IV) The number of hours booked to an above-the-line account for each listed employee.
The percent of total annual compensation booked to an above-the-line account for each employee.
This subparagraph does not apply to an employee represented by a labor organization, covered under a valid collective bargaining agreement, and performing activities described in this chapter at the direction of the labor organization.
To the extent the utility retains outside vendors to perform activities described in subdivision (b) and those vendors conduct any other work where the costs of the work are recorded to above-the-line accounts, the utility shall provide the Federal Energy Regulatory Commission Uniform System of Accounts number under which those costs are recorded and a log documenting the time, work performed, total cost incurred, how those costs benefit ratepayers, and the reason those activities are not deemed to be activities for which the recovery through rates of those costs is prohibited pursuant to subdivision (b).
A detailed accounting of expenses booked to an above-the-line account for participation in each commission proceeding for which the utility is a party, including employee compensation, and vendor and other expenses.
The commission shall make all reports filed pursuant to paragraph (1) with the commission publicly available, consistent with Section 583.
The commission shall monitor and investigate compliance and noncompliance with this section.
Moving an expense to a below-the-line account after it was booked to an above-the-line account does not protect that expense from being disclosed to the commission or disclosed in response to a discovery request or order in a general rate case or other relevant commission proceeding.
In addition to any disallowance or future adjustment ordered by the commission, the commission shall assess a civil penalty, based on the severity of the violation, against a utility that violates subdivision (b) or fails or neglects to comply with any part or provision of any order, decision, decree, rule, direction, demand, or requirement of the commission implementing subdivision (b).
This section does not limit the commission’s authority under any other law to assess a penalty or sanction against a utility that violates subdivision (b) or fails or neglects to comply with any part or provision of any order, decision, decree, rule, direction, demand, or requirement of the commission implementing subdivision (b).
Except as provided in subdivisions (c), (d), and (e), the commission shall require revenues, including any accrued interest, received by an electrical corporation as a result of the direct allocation of greenhouse gas allowances to electric utilities pursuant to subdivision (b) of Section 95890 of Title 17 of the California Code of Regulations to be credited directly to the residential customers of the electrical corporation.
Small business, emissions-intensive, trade-exposed retail customers of the electrical corporation that are covered entities under the regulations adopted pursuant to Section 38562 of the Health and Safety Code, and emissions-intensive, trade-exposed retail customers of the electrical corporation that are not covered entities under the regulations adopted pursuant to Section 38562 of the Health and Safety Code, may also be credited from the revenues in paragraph (1), as determined by the commission.
The credits provided to residential customers of an electrical corporation shall be provided on the bills of those customers in no more than four high-billed months of each year to maximize customer electric bill affordability, or as otherwise directed by the commission to address extreme, unforeseen, and temporary circumstances.
Not later than January 1, 2013, the commission shall require the adoption and implementation of a customer outreach plan for each electrical corporation, including, but not limited to, such measures as notices in bills and through media outlets, for purposes of obtaining the maximum feasible public awareness of the crediting of greenhouse gas allowance revenues. Costs associated with the implementation of this plan are subject to recovery in rates pursuant to Section 454.
Not later than January 1, 2027, the commission shall require each electrical corporation to update the customer outreach plan developed pursuant to paragraph (1) to include a statement at the top of customer bills in applicable months specifying the amount of money saved on a utility bill in that month and attributing those savings to the climate credit and the California Cap-and-Invest Program.
The commission may allocate up to 15 percent of the revenues, including any accrued interest, received by an electrical corporation as a result of the direct allocation of greenhouse gas allowances to electrical distribution utilities pursuant to subdivision (b) of Section 95890 of Title 17 of the California Code of Regulations, for clean energy and energy efficiency projects established pursuant to statute that are administered by the electrical corporation, or a qualified third-party administrator as approved by the commission, and that are not otherwise funded by another funding source. This subdivision shall become inoperative on July 1, 2026.
A local publicly owned electric utility that receives an allowance allocation in addition to the allowance totals specified in Section 95892 of Title 17 of the California Code of Regulations pursuant to subparagraph (B) of paragraph (1) of subdivision (b) of Section 38562 of the Health and Safety Code shall provide a credit in an amount equal to the total value of that additional allocation directly to ratepayers. This section does not limit the acceptable uses, as specified in paragraph (3) of subdivision (d) of Section 95892 of Title 17 of the California Code of Regulations, of other allowances allocated to local publicly owned electric utilities.
A local publicly owned electric utility shall report to the State Air Resources Board on the uses of all revenues, including any accrued interest, received by that local publicly owned electric utility as a result of the direct allocation of greenhouse gas allowances to electric utilities pursuant to subdivision (b) of Section 95890 of Title 17 of the California Code of Regulations.
Beginning with the fiscal year commencing July 1, 2019, and ending with the fiscal year ending June 30, 2023, the commission shall annually allocate fifty million dollars ($50,000,000) of the revenues, including any accrued interest, received by a gas corporation as a result of the direct allocation of greenhouse gas emissions allowances provided to gas corporations as part of a market-based compliance mechanism adopted pursuant to subdivision (c) of Section 38562 of the Health and Safety Code to fund the Building Initiative for Low-Emissions Development (BUILD) Program (Article 12 (commencing with Section 921)) and the Technology and Equipment for Clean Heating (TECH) Initiative (Article 13 (commencing with Section 922)).
Public utilities shall develop programs in cooperation with local school districts in reducing their electricity and gas bills through conservation and improvements in efficiency. Utilities may offer to school districts on a priority basis, and school districts may utilize, any programs or incentives for commercial customers developed by the utility and approved by the commission, including rebates, loan programs and incentives for the installation of efficient lighting, heating, or cooling systems.
For the purposes of this section, “public school” means a public school, including a charter school, maintaining a kindergarten, or any of the grades 1 to 12, inclusive.
The commission shall, as part of its ratesetting process, direct each electrical and gas corporation to evaluate and report findings to the commission, by January 1, 2020, on the feasibility and economic impact of establishing public school electric and gas rates that would reflect a discount from the current rate structure. The report shall include, but not be limited to, the following:
Commercial rate increases in the past five years that affected public schools within the service territory of each electrical and gas corporation.
Economic impact to all ratepayers if all public schools within the service territory received a discount from the current rate structure.
The impact of planned modifications to the time intervals reflected in time-of-use rates and to rate design elements, as adopted by the commission and in the planning stages or proposed by electric and gas corporations.
The cost shifts that would occur, if any, and to which consumers the costs would shift, as a result of a discounted rate for public schools.
The commission shall compile the reports required in subdivision (b) and submit the compilation to the Legislature, on or before January 1, 2020, in compliance with the requirements of Section 9795 of the Government Code.
The commission shall develop formal procedures to consider safety in a rate case application by an electrical corporation or gas corporation. The procedures shall include a means by which safety information acquired by the commission through monitoring, data tracking and analysis, accident investigations, and audits of an applicant’s safety programs may inform the commission’s consideration of the application.
This section applies only to those public utilities over which the commission exercises its authority to fix rates and only to the extent the revenue requirements of the utility were based upon the tax rates in effect at the time rates were fixed for the utility by the commission. This section does not limit the discretionary authority of the commission to adjust any incentives provided pursuant to any state supervised or administered program, including the state’s telecommunications universal service programs administered pursuant to Chapter 1.5 (commencing with Section 270).
The commission shall evaluate the full effect of the enactment of federal House Resolution 1 (Public Law 115-97) upon the expenses and tax liabilities incurred by public utilities for payment of federal taxes. If the commission determines that the projected expenses and tax liabilities for federal taxes that the commission has authorized in the rates for a public utility are materially affected by the enactment of federal House Resolution 1 (Public Law 115-97), the commission shall adjust the rates of the utility to reflect the changes in projected expenses and tax liabilities in light of the changes in federal law. This section does not limit the discretionary authority of the commission to determine the full effect of the changes in federal tax law on each utility’s cost of service, to utilize appropriate mechanisms at its disposal to track changes and adjust rates accordingly, and to allocate the impacts from changes in federal tax law over the period of time that results in the most reasonable allocation based on the particular circumstances of each utility.
It is the intent of the Legislature that:
An electrical, gas, or water corporation that offers customers credit card or debit card payment options, may recover the reasonable expenses incurred by the electrical, gas, or water corporation for providing the customers the option of paying their bills by credit card or debit card.
Only the customers that choose to use these payment options incur the additional charge and that no portion of the expense is shifted to customers that do not choose to pay a bill by credit card or debit card, unless and until the commission determines that the savings to ratepayers exceeds the net cost of accepting those cards.
The acceptance of credit cards or debit cards neither increases nor decreases the profitability of the electrical, gas, or water corporation.
An electrical, gas, or water corporation may offer credit card and debit card bill payment options, if approved by the commission. The electrical, gas, or water corporation may recover reasonable transaction costs incurred by the electrical, gas, or water corporation only from those customers that choose to pay by those payment options.
The commission shall determine through existing regulatory mechanisms the reasonableness of transaction costs charged to customers that choose to pay an electrical, gas, or water corporation by a credit card or debit card bill payment option pursuant to this section. The commission shall determine how any associated costs or potential savings as a result of those customers paying by the credit card or debit card payment option shall be passed on to electrical, gas, or water corporation customers. In determining how these savings or costs are passed on to customers, the commission shall do the following:
The transaction costs that are passed on to customers pursuant to subdivision (b) shall be offset by any savings in transaction costs the electrical, gas, or water corporation derives as a result of those customers paying by credit card and debit card.
If the commission determines that the use of credit cards and debit cards results in no net cost to the electrical, gas, or water corporation, there shall be no individual customer transaction fee as provided for in subdivision (b).
If the commission determines that the savings to the electrical, gas, or water corporation exceeds the costs to the electrical, gas, or water corporation, the net savings shall be passed on to electrical, gas, or water corporation customers.
Notwithstanding Section 755, the commission shall allow a water corporation with 10,000 or more service connections to recover the reasonable expenses incurred by the water corporation in providing to its customers bill payment options, including credit card, debit card, and prepaid card bill payment options, and shall not require the water corporation to impose a transaction fee on its customers.
The costs of the bill payment options undertaken pursuant to subdivision (a) shall not be recovered from customers participating in a water rate relief program for low-income ratepayers established pursuant to Section 739.8.
The commission shall ensure that accepting bill payment options pursuant to subdivision (a) neither increases nor decreases the rate of return of the water corporation.
The commission shall allow an electrical corporation to recover in rates amounts assessed to the utility pursuant to Section 8610.5 of the Government Code.
The commission shall ensure that any moneys refunded to an electrical corporation from the Nuclear Planning Assessment Special Account pursuant to subdivision (h) of Section 8610.5 of the Government Code are credited to ratepayers.
ARTICLE 3. Equipment, Practices, and Facilities [761. - 788.]
Whenever the commission, after a hearing, finds that the rules, practices, equipment, appliances, facilities, or service of any public utility, or the methods of manufacture, distribution, transmission, storage, or supply employed by it, are unjust, unreasonable, unsafe, improper, inadequate, or insufficient, the commission shall determine and, by order or rule, fix the rules, practices, equipment, appliances, facilities, service, or methods to be observed, furnished, constructed, enforced, or employed. The commission shall prescribe rules for the performance of any service or the furnishing of any commodity of the character furnished or supplied by any public utility, and, on proper demand and tender of rates, such public utility shall furnish such commodity or render such service within the time and upon the conditions provided in such rules.
Notwithstanding subdivision (g) of Section 216 and subdivision (c) of Section 218.5, the commission shall implement and enforce standards for the maintenance and operation of facilities for the generation and storage of electricity owned by an electrical corporation or located in the state to ensure their reliable operation. The commission shall enforce the protocols for the scheduling of powerplant outages of the Independent System Operator.
This section does not authorize the commission to establish rates for wholesale sales in interstate commerce from those facilities, or to approve the sale or transfer of control of facilities if an exempt wholesale generator, as defined in the federal Public Utility Holding Company Act of 2005 (42 U.S.C. Sec. 16451(6)).
Except as otherwise provided in this subdivision, this section does not apply to nuclear powered generating facilities that are federally regulated and subject to standards developed by the Nuclear Regulatory Commission and that participate as members of the Institute of Nuclear Power Operations.
The owner or operator of a nuclear powered generating facility shall file with the commission an annual schedule of maintenance, including repairs and upgrades, updated quarterly, for each generating facility. The owner or operator of a nuclear powered generating facility shall make good faith efforts to conduct its maintenance in compliance with its filed plan and shall report to the Independent System Operator any significant variations from its filed plan.
The owner or operator of a nuclear powered generating facility shall report on a monthly basis to the commission all actual planned and unplanned outages of each facility during the preceding month. The owner or operator of a nuclear powered generating facility shall report on a daily basis to the Independent System Operator the daily operational status and availability of each facility.
Except as otherwise provided in this subdivision, this section does not apply to a qualifying small power production facility or a qualifying cogeneration facility within the meaning of Sections 201 and 210 of Title 11 of the federal Public Utility Regulatory Policies Act of 1978 (16 U.S.C. Secs. 796(17), 796(18), and 824a-3), and the regulations adopted pursuant to those sections by the Federal Energy Regulatory Commission (18 C.F.R. Secs. 292.101 to 292.602, inclusive), nor does this section apply to other generation units installed, operated, and maintained at a customer site exclusively to serve that customer’s load.
An electrical corporation that has a contract with a qualifying small power production facility, or a qualifying cogeneration facility, with a name plate rating of 10 megawatts or greater, shall report to the commission maintenance schedules for each facility, including all actual planned and unplanned outages of the facility and the daily operational status and availability of the facility. Each facility with a name plate rating of 10 megawatts or greater shall be responsible for directly reporting to the Independent System Operator maintenance schedules for each facility, including all actual planned and unplanned outages of the facility and the daily operational status and availability of the facility, if that information is not provided to the electrical corporation pursuant to a contract.
This section shall not result in the modification, delay, or abrogation of any deadline, standard, rule, or regulation adopted by a federal, state, or local agency for the purposes of protecting public health or the environment, including, but not limited to, any requirements imposed by the State Air Resources Board or by an air pollution control district or an air quality management district pursuant to Division 26 (commencing with Section 39000) of the Health and Safety Code. The Independent System Operator shall consult with the State Air Resources Board and the appropriate local air pollution control districts and air quality management districts to coordinate scheduled outages to provide for compliance with those retrofits.
The Independent System Operator shall maintain records of generation and storage facility outages and shall provide those records to the commission on a daily basis. Each entity that owns or operates an electric generating unit in California with a rated maximum capacity of 10 megawatts or greater shall provide a monthly report to the Independent System Operator that identifies any periods during the preceding month when the unit was unavailable to produce electricity or was available only at reduced capacity. The report shall identify the reasons for any such unscheduled unavailability or reduced capacity. The Independent System Operator shall immediately transmit the information to the commission.
This section does not apply to any of the following:
A facility owned by a local publicly owned electric utility.
A public agency that may generate electricity incidental to the provision of water or wastewater treatment.
A facility owned by a city and county operating as a public utility, furnishing electric service as provided in Section 10001.
In order to ensure the safety of employees, emergency responders, and surrounding communities, each battery energy storage facility located in the state and subject to subdivision (a) shall have an emergency response and emergency action plan that covers the premises of the battery energy storage facility, consistent with Sections 142.3 and 6401 of the Labor Code and any related regulations, including the regulatory requirements applicable to emergency action plans pursuant to Section 3220 of Title 8 of the California Code of Regulations.
The emergency response and emergency action plan shall do all of the following:
Establish response procedures for an equipment malfunction or failure.
Include procedures that provide for the safety of surrounding residents, neighboring properties, emergency responders, and the environment. These procedures shall be established in consultation with local emergency management agencies.
Establish notification and communication procedures between the battery energy storage facility and local emergency management agencies.
The emergency response and emergency action plan may do all of the following:
Consider responses to potential offsite impacts, including, but not limited to, poor air quality, threats to municipal water supplies, water runoff, and threats to natural waterways.
Include procedures for the local emergency response agency to establish shelter-in-place orders and road closure notifications when appropriate.
In developing the emergency response and emergency action plan, the owner or operator of the battery energy storage facility shall coordinate with local emergency management agencies, unified program agencies, and local first response agencies.
The owner or operator of each battery energy storage facility shall submit the emergency response and emergency action plan to the county and, if applicable, the city where the facility is located.
Where the commission determines that it would be cost-effective, the commission shall authorize electrical and gas corporations to participate in a centralized credit check system to share information on customers; and the electrical and gas corporations may also share information on customers with telephone corporations and publicly owned public utilities. No public utility which participates in the centralized credit check system shall utilize any information obtained through the database for its internal marketing purposes. A public utility may release pertinent information to a collection agency for the purpose of collecting an outstanding bill, but shall not otherwise release, transfer, or sell any information obtained through the centralized credit check system.
Every electrical and gas corporation which participates in a centralized credit check system is subject to the Consumer Credit Reporting Agencies Act (Title 1.6 (commencing with Section 1785.1) of Part 4 of Division 3 of the Civil Code) and the federal Fair Credit Reporting Act (15 U.S.C. Sec. 1681 et seq.).
Whenever the commission, after a hearing, finds that additions, extensions, repairs, or improvements to, or changes in, the existing plant, equipment, apparatus, facilities, or other physical property of any public utility or of any two or more public utilities ought reasonably to be made, or that new structures should be erected, to promote the security or convenience of its employees or the public, or in any other way to secure adequate service or facilities, the commission shall make and serve an order directing that such additions, extensions, repairs, improvements, or changes be made or such structures be erected in the manner and within the time specified in the order. If the commission orders the erection of a new structure, it may also fix the site thereof. If the order requires joint action by two or more public utilities, the commission shall so notify them and shall fix a reasonable time within which they may agree upon the portion or division of the cost which each shall bear. If at the expiration of such time the public utilities fail to file with the commission a statement that an agreement has been made for a division or apportionment of the cost, the commission may, after further hearing, make an order fixing the proportion of such cost to be borne by each public utility and the manner in which payment shall be made or secured.
The commission, as a basis for making any order pursuant to the provisions of Section 762 relating to location of structures, shall give consideration to, and include in its order findings upon, the following factors:
Community values.
Recreational and park areas.
Historical and aesthetic values.
Influence on environment, except that in the case of any structure located in another state which will be subject to environmental impact review pursuant to the National Environmental Policy Act of 1969 (Chapter 55 (commencing with Section 4321) of Title 42 of the United States Code) or similar state laws in the other state, the commission shall not consider influence on the environment unless any emissions or discharges therefrom would have a significant influence on the environment of this state.
Whenever the commission, after a hearing, finds that any railroad corporation or street railroad corporation does not run a sufficient number of trains or cars, or possess or operate sufficient motive power, reasonably to accommodate the traffic, passenger or freight, transported by or offered for transportation to it, or does not run its trains or cars with sufficient frequency or at a reasonable or proper time having regard to safety, or does not stop its trains or cars at proper places, or does not run any train or car upon a reasonable time schedule for the run, the commission may make an order directing such corporation to increase the number of its trains or cars or its motive power or to change the time for starting its trains or cars or to change the time schedule for the run of any train or car, or to change the stopping place or places thereof. The commission may make any other order that it determines to be reasonably necessary to accommodate and transport the traffic, passenger or freight, transported or offered for transportation.
Subdivision (a) is not applicable to network railroad transportation.
An electrical corporation that has a contract for private fire safety and prevention, mitigation, or maintenance services, shall only use those services for the direct defense of utility infrastructure when conducting fire safety and prevention, mitigation, and maintenance activities as determined to be appropriate by the electrical corporation.
An electrical corporation that has a contract for private fire safety and prevention, mitigation, or maintenance services shall make an effort to reduce or eliminate the use of contract private fire safety and prevention, mitigation, and maintenance personnel in favor of employing highly skilled and apprenticed personnel to perform those services in direct defense of utility infrastructure in collaboration with public agency fire departments having jurisdiction.
Nothing in this section prohibits an electrical corporation from contracting with a public agency fire department or relevant jurisdiction for the purposes of providing fire safety and prevention, mitigation, or maintenance services.
A fire protection district may require an electrical corporation or local publicly owned electric utility to notify the fire protection district at least 24 hours before performing a prescribed or controlled burn.
If an electrical corporation or local publicly owned electric utility cannot provide 24 hours’ notice pursuant to subdivision (a) due to unforeseen circumstances, the electrical corporation or local publicly owned electric utility shall notify the fire protection district at the earliest possible time.
An electrical corporation or local publicly owned electric utility shall provide notice to a fire protection district pursuant to this section by both telephone and email.
This section does not limit or otherwise affect the ability of a fire protection district or any other local agency to require different notice for a prescribed or controlled burn, or impose other requirements allowable by law regarding a prescribed or controlled burn.
When the federal National Transportation Safety Board (NTSB) submits a safety recommendation letter concerning rail safety to the commission, the commission shall provide the NTSB with a formal written response to each recommendation no later than 90 days after receiving the letter. The response shall state one of the following:
The commission’s intent to implement the recommendations in full, with a proposed timetable for implementation of the recommendations.
The commission’s intent to implement part of the recommendations, with a proposed timetable for implementation of those recommendations, and detailed reasons for the commission’s refusal to implement those recommendations that the commission does not intend to implement.
The commission’s refusal to implement the recommendations, with detailed reasons for the commission’s refusal to implement the recommendations.
If the NTSB issues a safety recommendation letter concerning any commission-regulated rail facility to the United States Department of Transportation, the Federal Transit Administration, a commission-regulated rail operator, or the commission, or if the Federal Transit Administration issues a safety advisory concerning any commission-regulated rail facility, the commission shall determine if implementation of the recommendation or advisory is appropriate. The basis for the commission’s determination shall be detailed in writing and shall be approved by a majority vote of the commission.
If the commission determines that a safety recommendation made by the NTSB is appropriate, or that action concerning a safety advisory is necessary, the commission shall issue orders or adopt rules to implement the safety recommendation or advisory as soon as practicable. In implementing the safety recommendation or advisory, the commission shall consider whether a more effective, or equally effective and less costly, alternative exists to address the safety issue that the recommendation or advisory addresses.
The purpose of this section is to provide that the commission takes all appropriate action necessary to ensure the safe operation of railroads in this state.
The commission shall dedicate sufficient resources necessary to adequately carry out the State Participation Program for the regulation of rail transportation of hazardous materials as authorized by the Hazardous Material Transportation Uniform Safety Act of 1990 (P.L. 101-615).
On or before July 1, 1992, the commission shall hire a minimum of six additional rail inspectors who are or shall become federally certified, consisting of three additional motive power and equipment inspectors, two signal inspectors, and one operating practices inspector, for the purpose of enforcing compliance by railroads operating in this state with state and federal safety regulations.
On or before July 1, 1992, the commission shall establish, by regulation, a minimum inspection standard to ensure, at the time of inspection, that railroad locomotives, equipment, and facilities located in class I railroad yards in California will be inspected not less frequently than every 120 days, and inspection of all branch and main line track not less frequently than every 12 months.
Commencing July 1, 2008, in addition to the minimum inspections undertaken pursuant to subdivision (d), the commission shall conduct focused inspections of railroad yards and track, either in coordination with the Federal Railroad Administration, or as the commission determines to be necessary. The focused inspection program shall target railroad yards and track that pose the greatest safety risk, based on inspection data, accident history, and rail traffic density.
Federal funds available to the commission for rail safety inspection and enforcement purposes shall be allocated to eligible passenger and freight rail activities on a proportionate basis.
Whenever the commission, after a hearing finds that a physical connection can reasonably be made between the lines of two or more telephone corporations or two or more telegraph corporations whose lines can be made to form a continuous line of communication, by the construction and maintenance of suitable connections for the transfer of messages or conversations, and that public convenience and necessity will be served thereby, or finds that two or more telegraph or telephone corporations have failed to establish joint rates, tolls, or charges for service by or over their lines, and that joint rates, tolls, or charges ought to be established, the commission may, by its order, require that such connection be made on the payment of such compensation, if any, as it finds to be just and reasonable, except where the purpose of the connection is primarily to secure the transmission of local messages or conversations between points within the same city, or city and county. The commission may, by order, require that conversations be transmitted and messages transferred over such connection under such rules as it may establish, and may prescribe through lines and joint rates, tolls, and charges. If such telephone or telegraph corporations do not agree upon the division between them of the cost of such physical connection or connections or the division of such joint rates, tolls, or charges established by the commission over such through lines, the commission may after further hearing, establish such division by supplemental order.
The commission shall investigate the practices of every telephone corporation in billing its subscribers for telephone calls, including, but not limited to, whether a corporation is unable to determine whether any telephone call was not completed and as a consequence may charge the subscriber for that uncompleted call. If the commission finds that any corporation does not have the capability of determining in every instance whether a call placed by a subscriber was completed, the commission shall require the corporation to furnish written notice, in a form and manner approved by the commission, to its subscribers of its billing practices, including, but not limited to, its practice of charging for calls placed but not completed.
Whenever the commission, after a hearing had upon its own motion or upon complaint of a public utility affected, finds that public convenience and necessity require the use by one public utility of all or any part of the conduits, subways, tracks, wires, poles, pipes, or other equipment, on, over, or under any street or highway, and belonging to another public utility, and that such use will not result in irreparable injury to the owner or other users of such property or equipment or in any substantial detriment to the service, and that such public utilities have failed to agree upon such use or the terms and conditions or compensation therefor, the commission may by order direct that such use be permitted, and prescribe a reasonable compensation and reasonable terms and conditions for the joint use. If such use is directed, the public utility to whom the use is permitted shall be liable to the owner or other users for such damage as may result therefrom to the property of the owner or other users thereof, and the commission may ascertain and direct the payment, prior to such use, of fair and just compensation for damage suffered, if any.
As used in this section:
“Public utility” includes any person, firm, or corporation, except a publicly owned public utility, which owns or controls, or in combination jointly owns or controls, support structures or rights-of-way used or useful, in whole or in part, for wire communication.
“Support structure” includes, but is not limited to, a utility pole, anchor, duct, conduit, manhole, or handhole.
“Pole attachment” means any attachment to surplus space, or use of excess capacity, by a cable television corporation for a wire communication system on or in any support structure located on or in any right-of-way or easement owned, controlled, or used by a public utility.
“Surplus space” means that portion of the usable space on a utility pole which has the necessary clearance from other pole users, as required by the orders and regulations of the commission, to allow its use by a cable television corporation for a pole attachment.
“Excess capacity” means volume or capacity in a duct, conduit, or support structure other than a utility pole or anchor which can be used, pursuant to the orders and regulations of the commission, for a pole attachment.
“Usable space” means the total distance between the top of the utility pole and the lowest possible attachment point that provides the minimum allowable vertical clearance.
“Minimum allowable vertical clearance” means the minimum clearance for communication conductors along rights-of-way or other areas as specified in the orders and regulations of the commission.
“Rearrangements” means work performed, at the request of a cable television corporation, to, on, or in an existing support structure to create such surplus space or excess capacity as is necessary to make it usable for a pole attachment. When an existing support structure does not contain adequate surplus space or excess capacity and cannot be so rearranged as to create the required surplus space or excess capacity for a pole attachment, “rearrangements” shall include replacement, at the request of a cable television corporation, of the support structure in order to provide adequate surplus space or excess capacity.
“Annual cost of ownership” means the sum of the annual capital costs and annual operation costs of the support structure which shall be the average costs of all similar support structures owned by the public utility. The basis for computation of annual capital costs shall be historical capital costs less depreciation. The accounts upon which the historical capital costs are determined shall include a credit for all reimbursed capital costs of the public utility. Depreciation shall be based upon the average service life of the support structure. As used in this paragraph, “annual cost of ownership” shall not include costs for any property not necessary for a pole attachment.
The Legislature finds and declares that public utilities have dedicated a portion of such support structures to cable television corporations for pole attachments in that public utilities have made available, through a course of conduct covering many years, surplus space and excess capacity on and in their support structures for use by cable television corporations for pole attachments, and that the provision by such public utilities of surplus space and excess capacity for such pole attachments is a public utility service delivered by public utilities to cable television corporations.
The Legislature further finds and declares that it is in the interests of the people of California for public utilities to continue to make available such surplus space and excess capacity for use by cable television corportions.
Whenever a public utility and a cable television corporation or association of cable television corporations are unable to agree upon the terms, conditions, or annual compensation for pole attachments or the terms, conditions, or costs of rearrangements, the commission shall establish and enforce the rates, terms, and conditions for pole attachments and rearrangements so as to assure a public utility the recovery of both of the following:
A one-time reimbursement for actual costs incurred by the public utility for rearrangements performed at the request of the cable television corporation.
An annual recurring fee computed as follows:
For each pole and supporting anchor actually used by the cable television corporation, for a period of four years following the effective date of this section, the annual fee shall be two dollars and fifty cents ($2.50). Thereafter, the annual fee shall be two dollars and fifty cents ($2.50) or 7.4 percent of the public utility’s annual cost of ownership for the pole and supporting anchor, whichever is greater, except that if a public utility applies for establishment of a fee in excess of two dollars and fifty cents ($2.50) under this section, the annual fee shall be 7.4 percent of the public utility’s annual cost of ownership for the pole and supporting anchor.
For support structures used by the cable television corporation, other than poles or anchors, a percentage of the annual cost of ownership for the support structure, computed by dividing the volume or capacity rendered unusable by the cable television corporation’s equipment by the total usable volume or capacity. As used in this paragraph, “total usable volume or capacity” means all volume or capacity in which the public utility’s line, plant, or system could legally be located, including the volume or capacity rendered unusable by the cable television corporation’s equipment.
In the event that it becomes necessary for the public utility to use space or capacity on or in a support structure occupied by the cable television corporation’s equipment, the cable television corporation shall either (1) pay all costs for rearrangements necessary to maintain the pole attachment or (2) remove its cable television equipment at its own expense.
The Legislature finds and declares all of the following:
The Legislature has encouraged, and continues to encourage, the rapid and economic development of telecommunications services to all Californians.
Pursuant to Section 767.5, public utilities have dedicated a portion of their support structures to cable television corporations which have been increasingly attaching fiber optic cable that is capable of a variety of telecommunications uses. Other utilities not under the jurisdiction of the commission have also made the same dedication.
Public utility and publicly owned utility support structures are also used by entities, other than cable television corporations, with the acquiescence of the public utility and voluntary permission of the publicly owned utility, for the purpose of installing fiber optic cable in order to provide various telecommunications services.
Electric public utilities are currently installing fiber optic cables on their systems to enhance their operations and better serve their customers. Fiber optic cables installed by telephone, cable, and other telecommunications corporations may be accessed by electric public utilities and publicly owned utilities to enhance their operations and better serve their customers. The access may be accomplished by contract or through the purchase of tariffed services.
It is therefore the intent of the Legislature that public utilities and publicly owned utilities be fairly and adequately compensated for the use of their rights-of-way and easements for the installation of fiber optic cable, and that electric public utilities and publicly owned utilities have the ability, if they so desire, to negotiate a purchase, lease, or rent of access to those fiber optic cables for their own use.
Nothing in this section shall be deemed to change existing law with respect to Section 767.5.
The commission may, after a hearing, require every public utility to construct, maintain, and operate its line, plant, system, equipment, apparatus, tracks, and premises in a manner so as to promote and safeguard the health and safety of its employees, passengers, customers, and the public. The commission may prescribe, among other things, the installation, use, maintenance, and operation of appropriate safety or other devices or appliances, including interlocking and other protective devices at grade crossings or junctions and block or other systems of signaling. The commission may establish uniform or other standards of construction and equipment, and require the performance of any other act which the health or safety of its employees, passengers, customers, or the public may demand. The Department of the California Highway Patrol shall have the primary responsibility for the regulation of the safety of operation of passenger stage corporations. The commission shall cooperate with the Department of the California Highway Patrol to ensure safe operation of these carriers.
The commission may, after a hearing, by general or special orders, rules, or otherwise, require every cable television corporation to construct, maintain, and operate its plant, system, equipment, apparatus, and premises in such manner as to promote and safeguard the health and safety of its employees, customers, and the public, and may prescribe, among other things, the installation, use, maintenance, and operation of appropriate safety or other devices or appliances, establish uniform or other standards of construction and equipment, and require the performance of any other act which the health or safety of its employees, customers, or the public may demand.
Nothing in this section shall be construed to either grant or deny a cable antenna television corporation the right to use the easement of a public utility.
The commission shall establish standards for disaster and emergency preparedness plans within an existing proceeding, including, but not limited to, use of weather reports to preposition manpower and equipment before anticipated severe weather, methods of improving communications between governmental agencies and the public, and methods of working to control and mitigate an emergency or disaster and its aftereffects. The commission, when establishing standards pursuant to this subdivision, may make requirements for small water corporations similar to those imposed on class A water corporations under paragraph (2) of subdivision (f).
An electrical corporation, as defined in Section 218, providing service in California shall develop, adopt, and update an emergency and disaster preparedness plan in compliance with the standards established by the commission pursuant to subdivision (a).
In developing and adopting an emergency and disaster preparedness plan, an electrical corporation providing service in California shall invite appropriate representatives of every city, county, or city and county within that electrical corporation’s service area in California to meet with, and provide consultation to, the electrical corporation.
Every city, county, or city and county within the electrical corporation’s service area in California may designate a point of contact for the electrical corporation to consult with on emergency and disaster preparedness plans.
The electrical corporation shall provide the point of contact designated pursuant to subparagraph (B) with an opportunity to comment on draft emergency and disaster preparedness plans.
For the purposes of best preparing an electrical corporation for future emergencies or disasters, an emergency and disaster preparedness plan shall address recent emergencies and disasters associated with the electrical corporation or similarly situated corporations, and shall address remedial actions for possible emergencies or disasters that may involve that corporation’s provision of service.
Every two years, in order to update and improve that electrical corporation’s emergency and disaster preparedness plan, an electrical corporation providing service in California shall invite appropriate representatives of every city, county, or city and county within that electrical corporation’s service area to meet with, and provide consultation to, the electrical corporation.
For the purposes of best preparing an electrical corporation for future emergencies or disasters, an electrical corporation updating its emergency and disaster preparedness plan shall review the disasters and emergencies that have affected similarly situated corporations since the adoption of the plan, remedial actions taken during those emergencies or disasters, and proposed changes to the plan. The electrical corporation shall adopt in its plan the changes that will best ensure the electrical corporation is reasonably prepared to deal with a disaster or emergency.
A meeting pursuant to subdivision (b) shall be noticed and shall be conducted in a public meeting that allows for the participation of appropriate representatives of counties and cities within the electrical corporation’s service area.
A county participating in a meeting pursuant to subdivision (b) may inform each city within the county of the time and place of the meeting.
An electrical corporation shall conduct a meeting pursuant to subdivision (b) no later than April 1, 2013, and every two years thereafter.
An electrical corporation shall memorialize a meeting pursuant to subdivision (b), and shall submit its records of the meeting to the commission.
A water company regulated by the commission shall develop, adopt, and update an emergency and disaster preparedness plan in compliance with the standards established by the commission pursuant to subdivision (a). This requirement shall be deemed fulfilled when the water company files an emergency and disaster preparedness plan pursuant to another state statutory requirement.
A water company developing, adopting, or updating an emergency and disaster preparedness plan pursuant to paragraph (1) shall hold meetings with representatives from each city, county, or city and county in the water company’s service area regarding the emergency and disaster preparedness plan.
An electrical corporation or a water corporation may fulfill a meeting requirement imposed by this section by making a presentation regarding its emergency and disaster preparedness plan at a regularly scheduled public meeting of each disaster council created pursuant to Article 10 (commencing with Section 8610) of Chapter 7 of Division 1 of Title 2 of the Government Code within the corporation’s service area, or at a regularly scheduled public meeting of the governing body of each city, county, or city and county within the service area.
For purposes of this section, “distributed resources” means distributed renewable generation resources, energy efficiency, energy storage, electric vehicles, and demand response technologies.
Not later than July 1, 2015, each electrical corporation shall submit to the commission a distribution resources plan proposal to identify optimal locations for the deployment of distributed resources. Each proposal shall do all of the following:
Evaluate locational benefits and costs of distributed resources located on the distribution system. This evaluation shall be based on reductions or increases in local generation capacity needs, avoided or increased investments in distribution infrastructure, safety benefits, reliability benefits, and any other savings the distributed resources provide to the electrical grid or costs to ratepayers of the electrical corporation.
Propose or identify standard tariffs, contracts, or other mechanisms for the deployment of cost-effective distributed resources that satisfy distribution planning objectives.
Propose cost-effective methods of effectively coordinating existing commission-approved programs, incentives, and tariffs to maximize the locational benefits and minimize the incremental costs of distributed resources.
Identify any additional utility spending necessary to integrate cost-effective distributed resources into distribution planning consistent with the goal of yielding net benefits to ratepayers.
Identify barriers to the deployment of distributed resources, including, but not limited to, safety standards related to technology or operation of the distribution circuit in a manner that ensures reliable service.
The commission shall review each distribution resources plan proposal submitted by an electrical corporation and approve, or modify and approve, a distribution resources plan for the corporation. The commission may modify any plan as appropriate to minimize overall system costs and maximize ratepayer benefit from investments in distributed resources.
Any electrical corporation spending on distribution infrastructure necessary to accomplish the distribution resources plan shall be proposed and considered as part of the next general rate case for the corporation. The commission may approve proposed spending if it concludes that ratepayers would realize net benefits and the associated costs are just and reasonable. The commission may also adopt criteria, benchmarks, and accountability mechanisms to evaluate the success of any investment authorized pursuant to a distribution resources plan.
Notwithstanding paragraph (1) of subdivision (a) of Section 1720 of the Labor Code, construction of a renewable electrical generation facility, and associated battery storage, after December 31, 2023, that receives service pursuant to the standard contract or tariff developed pursuant to Section 2827.1, shall constitute a public works project for purposes of Article 2 (commencing with Section 1770) of Chapter 1 of Part 7 of Division 2 of the Labor Code, except as specified in subdivision (f).
A contractor who enters into a contract to perform work on a renewable electrical generation facility or associated battery storage described in subdivision (a) shall do all of the following:
The contractor shall pay each construction worker employed in the execution of the work, at minimum, the general prevailing rate of per diem wages, except that an apprentice registered in a program approved by the Chief of the Division of Apprenticeship Standards shall be paid, at minimum, the applicable apprentice prevailing rate.
The contractor shall maintain and verify payroll records pursuant to Section 1776 of the Labor Code and make those records available for inspection and copying as provided in that section. Notwithstanding Section 1776 of the Labor Code, the contractor shall not be required to provide copies of certified payroll records to any entity other than the Department of Industrial Relations and the commission.
The contractor shall biannually, on July 1 and December 31 of each year, submit to the commission digital copies of its certified payroll records, in a format consistent with systems used for compliance with Section 1776 of the Labor Code, for projects subject to this section. The commission shall retain these records as public records for five years.
The requirement imposed in paragraph (1) of subdivision (b) may be enforced through any of the following mechanisms:
If a willful violation of this section has been enforced against a contractor for the construction of a renewable electrical generation facility pursuant to subdivision (c), that facility shall remain eligible to receive service pursuant to a standard contract or tariff developed pursuant to Section 2827 or 2827.1 if restitution has been made to the affected workers and all associated penalties and fines have been paid.
The commission shall require each large electrical corporation to include the requirements of this section in each standard contract or tariff offered pursuant to Section 2827.1.
This section does not apply to a residential renewable electrical generation facility that is eligible to receive service pursuant to the standard contract or tariff developed pursuant to Section 2827.1 and has a maximum generating capacity of 15 kilowatts or less of electricity.
This section does not apply to a residential renewable electrical generation facility that is eligible to receive service pursuant to the standard contract or tariff developed pursuant to Section 2827.1 and that is installed on a single-family home.
This section does not apply to a renewable electrical generation facility that serves only a modular home, a modular home community, or multiunit housing that has two or fewer stories.
The entity that engaged the contractor to perform work on a renewable electrical generation facility and associated battery storage described in subdivision (a) is not an awarding body, as defined in Section 1722 of the Labor Code. Public works project requirements not found in this section do not apply to the entity. This section does not affect the entity’s liability for nonpayment of wages or materials under Section 3 of Article XIV of the California Constitution.
The contractor who enters into a contract with the entity described in paragraph (1) to perform work on a renewable electrical generation facility and associated battery storage described in subdivision (a) is the awarding body only for the limited purposes of Section 1773.3 of the Labor Code.
For purposes of this section, the following definitions apply:
“Community choice aggregator” has the same meaning as defined in Section 331.1.
“Customer renewable energy subscription program” does not include the net energy metering program specified in Sections 2827 and 2827.1 or the Multifamily Affordable Housing Solar Roofs Program established pursuant to Chapter 9.5 (commencing with Section 2870) of Part 2. “Customer renewable energy subscription program” includes an alternative designed for growth among residential customers in disadvantaged communities pursuant to paragraph (1) of subdivision (b) of Section 2827.1.
“Low-income customer” means either of the following:
An individual or household who qualifies for one or more of the following programs:
The California Alternate Rates for Energy (CARE) program described in Section 739.1.
The Family Electric Rate Assistance (FERA) program described in Section 739.12.
The CalFresh program established pursuant to Chapter 10 (commencing with Section 18900) of Part 6 of Division 9 of the Welfare and Institutions Code.
The federal Supplemental Nutrition Assistance Program (SNAP) (Chapter 51 (commencing with Section 2011) of Title 7 of the United States Code).
The Low-income Heating Energy Assistance Program (LIHEAP) (42 U.S.C. Sec. 8621).
An individual or household who resides within an underserved community.
“Underserved community” includes each of the following:
A “low-income community” as defined in Section 39713 of the Health and Safety Code.
A community within an area identified as among the 25 percent most disadvantaged areas in the state according to the California Environmental Protection Agency and based on the most recent California Communities Environmental Health Screening Tool, also known as CalEnviroScreen, that is used to identify disadvantaged communities pursuant to Section 39711 of the Health and Safety Code.
A community located on lands belonging to a California Native American tribe, as defined in Section 21073 of the Public Resources Code.
On or before March 31, 2024, the commission shall, in a new or existing proceeding, do both of the following:
Evaluate each customer renewable energy subscription program, including the Green Tariff Shared Renewables Program (Chapter 7.6 (commencing with Section 2831) of Part 2) and any program established as an alternative designed for growth among residential customers in disadvantaged communities pursuant to paragraph (1) of subdivision (b) of Section 2827.1, to determine if the program meets all of the following goals:
Efficiently serves distinct customer groups.
Minimizes duplicative offerings.
Promotes robust participation by low-income customers.
Consider, as part of the evaluation, the energy load migration trends among bundled and nonbundled customers and any associated risks with maintaining or creating a customer renewable energy subscription program.
If the commission determines a customer renewable energy subscription program does not meet all of the goals described in subparagraph (A), authorize the termination or modification of the program.
Determine whether it would be beneficial to ratepayers to establish a new tariff or program for an electrical corporation, or modify an existing tariff or program administered by an electrical corporation, to establish a community renewable energy program consistent with the criteria described in subdivision (c). If the commission determines that it would be beneficial to ratepayers to establish the community renewable energy program, the commission shall, on or before July 1, 2024, establish the program as part of the same proceeding and require each electrical corporation to participate in the program.
If the commission establishes a community renewable energy program pursuant to subparagraph (A), each community choice aggregator and electric service provider, within 180 days of the establishment of the program, shall notify the commission whether it will participate in the program. A community choice aggregator or electric service provider may begin participating in, or end its participation in, the program at any time by notifying the commission.
The community renewable energy program, if established, shall do all of the following:
Be complementary to, and consistent with, the requirements of Section 10-115 of the California Building Standards Code (Title 24 of the California Code of Regulations). For purposes of this paragraph, the commission shall consult with the Energy Commission.
Ensure at least 51 percent of the program’s capacity serves low-income customers.
Minimize impacts to nonparticipating customers by prohibiting the program’s costs from being paid by nonparticipating customers in excess of the avoided costs. Qualifying funds for financial incentives shall only be available through an appropriation by the Legislature.
Except as provided in subparagraph (B), require that all of the following requirements apply to the construction of a community renewable energy facility pursuant to the program:
All construction workers employed in the execution of the project shall be paid at least the general prevailing rate of per diem wages for the type of work and geographic area, as determined by the Director of Industrial Relations pursuant to Sections 1773 and 1773.9 of the Labor Code, except that apprentices registered in programs approved by the Chief of the Division of Apprenticeship Standards may be paid at least the applicable apprentice prevailing rate.
The owner of the community renewable energy facility shall ensure that the prevailing wage requirement is included in all contracts for the performance of the work.
All contractors and subcontractors shall maintain payroll records pursuant to Section 1776 of the Labor Code and make those records available for inspection and copying as provided in that section.
The requirement on contractors and subcontractors to pay prevailing wages pursuant to this section may be enforced by the Labor Commissioner through the issuance of a civil wage and penalty assessment pursuant to Section 1741 of the Labor Code, which may be reviewed pursuant to Section 1742 of the Labor Code, within 18 months after the completion of the project, by an underpaid worker through an administrative complaint or civil action, or by a joint labor-management committee through a civil action under Section 1771.2 of the Labor Code. If a civil wage and penalty assessment is issued, the contractor, subcontractor, and surety on a bond issued to secure the payment of wages covered by the assessment shall be liable for liquidated damages pursuant to Section 1742.1 of the Labor Code.
Chapter 1 (commencing with Section 1720) of Part 7 of Division 2 of the Labor Code and subparagraph (A) shall not apply to the construction of a community renewable energy facility pursuant to the program if all contractors and subcontractors performing work on the project are subject to a project labor agreement that requires the payment of prevailing wages and provides for enforcement of that obligation through an arbitration procedure. For purposes of this subparagraph, “project labor agreement” has the same meaning as defined in Section 2500 of the Public Contract Code.
Provide bill credits to subscribers based on the avoided costs of the program’s facilities, as determined by the commission’s methods for calculating the full set of benefits of distributed energy resources. The commission may use actual wholesale market prices for the energy supply portion of an avoided cost calculation or credit value.
Prioritize the maximum use of state and federal incentives and accelerate implementation of the program to ensure that time- or quantity-limited federal incentives can be obtained for the benefit of subscribers. As part of this prioritization, the commission shall ensure that a community renewable energy facility participating in the community renewable energy program is eligible for an enhanced federal investment tax credit available as a qualified low-income economic benefit project pursuant to subsection (e) of Section 48 of Title 26 of the United States Code.
The commission may establish an expedited distribution grid interconnection dispute resolution process with the goal of resolving disputes over interconnection applications that are within the jurisdiction of the commission in no more than 60 days from the time the dispute is formally brought to the commission. If the commission establishes an expedited distribution grid interconnection dispute resolution process, the commission may provide exceptions to the 60-day time period when more than 60 days are needed to fairly and safely address a dispute.
The expedited distribution grid interconnection dispute resolution process shall include the following elements:
A distribution grid interconnection technical panel consisting of at least eight individuals selected by the commission. Four of the technical panel members shall be from electrical corporations and four shall not be from electrical corporations. The commission shall determine the length of the term of each member. A member shall not participate as a review panel member for the dispute resolution process for a contested interconnection application in any of the following situations:
The member is an employee of, a contractor to, or an employee of a contractor to, an electrical corporation to which the contested interconnection application has been submitted.
The member is the applicant, an installer or an employee of an installer for the applicant, or a third-party electricity purchase agreement provider for the applicant.
The member has a direct financial interest in the contested interconnection application.
A review panel of four members shall be selected from the technical panel for each dispute.
If an applicant is unable to resolve an interconnection-related dispute after working with the electrical corporation operating the distribution grid, the applicant may seek resolution of the dispute using the commission’s expedited distribution grid interconnection dispute resolution process.
Upon agreeing to a final settlement of the dispute, parties shall be free to withdraw from the expedited distribution grid interconnection dispute resolution process.
If the dispute is filed with the commission, the commission shall ensure that the review panel shall review the dispute and make a recommendation to the executive director of the commission within 30 days of receiving the dispute.
The commission shall establish a public process to allow the electrical corporation, the applicant, and other interested parties to file written comments on the recommendation of the review panel.
The review panel shall request appropriate documents from the electrical corporation involved in the dispute, including, but not limited to, interconnection application studies.
The scope of the review panel’s review shall be limited to issues regarding compliance with the established interconnection rules. Any recommendations shall ensure safe and reliable interconnection.
The scope of the review panel’s review is limited to making recommendations to resolve specific customer disputes and recommending associated corrective actions, and the panel shall have no authority to assess penalties.
Upon receipt of the recommendation from the review panel, the executive director shall have 30 days to review the recommendation and to prepare an order to the electrical corporation resolving the dispute. If the review panel cannot agree on recommendations, then each recommendation of a review panel member shall be submitted to the executive director, who shall make the decision resolving the dispute.
Any interested person seeking commission review of the executive director’s determination shall file the request for review within 10 days of the determination. Upon receipt of the request for review, the executive director or the energy division director shall prepare a proposed resolution of the matter for approval by the commission.
The commission shall provide the members of the technical panel who are not from electrical corporations with an appropriate per diem compensation consistent with Section 19822.5 of the Government Code.
The commission shall appoint a qualified electrical systems engineer with substantial interconnection expertise to advise the director of the energy division and shall provide adequate commission staff to assist in resolving interconnection disputes.
The commission may after hearing:
Ascertain and fix just and reasonable standards, classifications, regulations, practices, measurements, or service to be furnished, imposed, observed, and followed by all electrical, gas, water, and heat corporations.
Ascertain and fix adequate and serviceable standards for the measurement of quantity, quality, pressure, or other condition pertaining to the supply of the product, commodity, or service furnished or rendered by any such public utility. No standard of the commission applicable to any water corporation shall be inconsistent with the regulations and standards of the State Department of Health pursuant to Chapter 4 (commencing with Section 116275) of Part 12 of Division 104 of the Health and Safety Code.
Prescribe reasonable regulations for the examination and testing of the product, commodity, or service and for the measurement thereof.
Establish reasonable rules, specifications, and standards to secure the accuracy of all meters and appliances for measurements. The commission shall require a public utility that estimates meter readings to so indicate on its billings, and shall require any estimate that is incorrect to be corrected by the next billing period, except that for reasons beyond its control due to weather, or in cases of unusual conditions, corrections for any overestimate or underestimate shall be reflected on the first regularly scheduled bill and based on an actual reading following the period of inaccessibility.
Provide for the examination and testing of any and all appliances used for the measurement of any product, commodity, or service of any such public utility.
The commissioners and their officers and employees may enter upon any premises occupied by any public utility, for the purpose of making the examinations and tests and exercising any of the other powers provided for in this part, and may set up and use on such premises any apparatus and appliances necessary therefor. The agents and employees of the public utility may be present at the making of such examinations and tests.
Any consumer or user of any product, commodity, or service of a public utility may have any appliance used in the measurement thereof tested upon paying the fees fixed by the commission. The commission shall establish and fix reasonable fees to be paid for testing such appliances on the request of the consumer or user. The fee shall be paid by the consumer or user at the time of his request, but if the appliance is found defective or incorrect to the disadvantage of the consumer or user, the fee shall be paid by the public utility and repaid to the consumer or user under such rules as the commission prescribes.
Section 4200 of the Government Code shall not apply to a public utility under the jurisdiction of the Public Utilities Commission of the State of California.
No water corporation which has undertaken to provide fire protection service, nor any employee of such corporation acting in the course and scope of his employment, shall be liable for any death or injury to a person or damage to or loss of property resulting from a failure to provide or maintain an adequate water supply or pressure, or any equipment or other fire protection facility or service; provided, that such immunity from liability shall not exceed that of a public agency or any of its employees, as the case may be, under similar circumstances. Nothing in this section shall preclude the enforcement of any rule, regulation, or order of the commission.
Whenever an electric or gas corporation sells fuel oil which is, or is reasonably expected to be, useful in the performance of its public utility function, at a price higher than the electric or gas corporation’s purchase cost, the commission shall, in any rate proceeding, require that the amount higher than the purchase cost be credited with interest against the expense claimed by the electric or gas corporation.
The commission shall, upon making the determination pursuant to subdivision (c), develop and implement performance reliability standards for all backup power systems installed on the property of residential and small commercial customers by a facilities-based provider of telephony services. Those standards shall do all the following:
Establish minimum operating life.
Establish minimum periods of time during which a telephone system with a charged backup power system will provide the customer with sufficient electricity for emergency usage.
Establish means to warn a customer when the backup power system’s charge is low or when the system can no longer hold a charge.
The commission, in developing and implementing any standards in accordance with subdivision (a), shall consider current best practices and technical feasibility for establishing battery backup requirements.
The commission shall not implement standards in accordance with this section unless it determines that the benefits of the standards exceed the costs.
For purposes of this section, “telecommunications service” has the same meaning as defined in Section 2892.1, but does not include voice communication provided by a provider of satellite telephone service.
As part of a new or existing proceeding, the commission, in consultation with the Office of Emergency Services, shall develop and implement backup electricity rules to require providers of telecommunications service to submit resiliency plans to maintain backup electricity for their telecommunications infrastructure sufficient to maintain telecommunications service for at least 72 hours, except as provided in subdivision (c).
In developing and implementing backup electricity rules pursuant to subdivision (b), the commission shall consider best practices, the feasibility of the rules, and stakeholder input. In considering best practices and feasibility, the commission may authorize, in appropriate circumstances, providers of telecommunications service to maintain backup electricity for their telecommunications infrastructure sufficient to maintain telecommunications service for less than 72 hours.
This section does not require the commission to modify the communications resiliency requirements adopted in commission Decision 20-07-011 (July 16, 2020), Decision Adopting Wireless Provider Resiliency Strategies, or Decision 21-02-029 (February 11, 2021), Decision Adopting Wireline Provider Resiliency Strategies.
Designate contact points or persons within the company to receive notifications from an electrical corporation, local publicly owned electric utility, or electrical cooperative, as defined in Section 2776, for expected deenergization events and outages.
Develop uniform protocols prior to a deenergization event to respond appropriately to an outage.
Upon receipt of a notification regarding the deenergization of electrical lines pursuant to Section 8386 or 8387, a facilities-based mobile telephony services provider shall communicate relevant situational information relative to communications capabilities during the projected outage to electrical corporations, local publicly owned electric utilities, electrical cooperatives, and appropriate public safety stakeholders, including, but not limited to, public safety offices and emergency response offices, for the affected area.
This section applies if there is a landlord-tenant relationship between the residential occupants and the owner, manager, or operator of the dwelling.
If an electrical, gas, heat, or water corporation furnishes individually metered residential service to residential occupants of a detached single-family dwelling, a multiunit residential structure, mobilehome park, or permanent residential structure in a labor camp, as defined in Section 17008 of the Health and Safety Code, and the owner, manager, or operator of the dwelling, structure, or park is the customer of record, the corporation shall make every good faith effort to inform the residential occupants, by means of written notice, when the account is in arrears, that service will be terminated at least 10 days prior to termination. The written notice shall further inform the residential occupants that they have the right to become customers, to whom the service will then be billed, without being required to pay any amount which may be due on the delinquent account. The notice shall be in English and in the languages listed in Section 1632 of the Civil Code.
The corporation is not required to make service available to the residential occupants unless each residential occupant agrees to the terms and conditions of service and meets the requirements of law and the corporation’s rules and tariffs. However, if one or more of the residential occupants are willing and able to assume responsibility for the subsequent charges to the account to the satisfaction of the corporation, or if there is a physical means, legally available to the corporation, of selectively terminating service to those residential occupants who have not met the requirements of the corporation’s rules and tariffs, the corporation shall make service available to those residential occupants who have met those requirements.
If prior service for a period of time is a condition for establishing credit with the corporation, residence and proof of prompt payment of rent or other credit obligation acceptable to the corporation for that period of time is a satisfactory equivalent.
Any residential occupant who becomes a customer of the corporation pursuant to this section whose periodic payments, such as rental payments, include charges for residential electrical, gas, heat, or water service, where those charges are not separately stated, may deduct from the periodic payment each payment period all reasonable charges paid to the corporation for those services during the preceding payment period.
In the case of a detached single-family dwelling, the corporation may do any of the following:
Give notice of termination at least seven days prior to the proposed termination.
In order for the amount due on the delinquent account to be waived, require an occupant who becomes a customer to verify that the delinquent account customer of record is or was the landlord, manager, or agent of the dwelling. Verification may include, but is not limited to, a lease or rental agreement, rent receipts, a government document indicating that the occupant is renting the property, or information disclosed pursuant to Section 1962 of the Civil Code.
This section shall become operative on July 1, 2010.
If an electrical, gas, heat, or water corporation furnishes residential service to residential occupants through a master meter in a multiunit residential structure, mobilehome park, or permanent residential structure in a labor camp, as defined in Section 17008 of the Health and Safety Code, and the owner, manager, or operator of the structure or park is listed by the corporation as the customer of record, the corporation shall make every good faith effort to inform the residential occupants, by means of a written notice posted on the door of each residential unit at least 15 days prior to termination, when the account is in arrears, that service will be terminated on a date specified in the notice. If it is not reasonable or practicable to post the notice on the door of each residential unit, the corporation shall post two copies of the notice in each accessible common area and at each point of access to the structure or structures. The notice shall further inform the residential occupants that they have the right to become customers, to whom the service will then be billed, without being required to pay any amount which may be due on the delinquent account. The notice also shall specify, in plain language, what the residential occupants are required to do in order to prevent the termination of, or to reestablish service; the estimated monthly cost of service; the title, address, and telephone number of a representative of the corporation who can assist the residential occupants in continuing service; and the address and telephone number of a qualified legal services project, as defined in Section 6213 of the Business and Professions Code, which has been recommended by the local county bar association. The notice shall be in English and the languages listed in Section 1632 of the Civil Code.
The corporation is not required to make service available to the residential occupants unless each residential occupant or a representative of the residential occupants agrees to the terms and conditions of service and meets the requirements of law and the corporation’s rules and tariffs. However, if one or more of the residential occupants or the representative of the residential occupants are willing and able to assume responsibility for subsequent charges to the account to the satisfaction of the corporation, or if there is a physical means, legally available to the corporation, of selectively terminating service to those residential occupants who have not met the requirements of the corporation’s rules and tariffs or for whom the representative of the residential occupants is not responsible, the corporation shall make service available to those residential occupants who have met those requirements or on whose behalf those requirements have been met.
If prior service for a period of time or other demonstration of credit worthiness is a condition for establishing credit with the corporation, residence and proof of prompt payment of rent or other credit obligation during that period of time acceptable to the corporation is a satisfactory equivalent.
Any residential occupant who becomes a customer of the corporation pursuant to this section whose periodic payments, such as rental payments, include charges for residential electrical, gas, heat, or water service, where those charges are not separately stated, may deduct from the periodic payment each payment period all reasonable charges paid to the corporation for those services during the preceding payment period.
If a corporation furnishes residential service subject to subdivision (a), the corporation shall not terminate that service in any of the following situations:
During the pendency of an investigation by the corporation of a customer dispute or complaint.
If the customer has been granted an extension of the period for payment of a bill.
For an indebtedness owed by the customer to any other person or corporation or if the obligation represented by the delinquent account or other indebtedness was incurred with a person or corporation other than the electrical, gas, heat, or water corporation demanding payment therefor.
If a delinquent account relates to another property owned, managed, or operated by the customer.
If a public health or building officer certifies that termination would result in a significant threat to the health or safety of the residential occupants or the public.
Notwithstanding any other provision of law, and in addition to any other remedy provided by law, if the owner, manager, or operator, by any act or omission, directs, permits, or fails to prevent a termination of service while any residential unit receiving that service is occupied, the residential occupant or the representative of the residential occupants may commence an action for the recovery of all of the following:
Reasonable costs and expenses incurred by the residential occupant or the representative of the residential occupants related to restoration of service.
Actual damages related to the termination of service.
Reasonable attorney’s fees of the residential occupants, the representative of the residential occupants, or each of them, incurred in the enforcement of this section, including, but not limited to, enforcement of a lien.
Notwithstanding any other provision of law, and in addition to any other remedy provided by law, if the owner, manager, or operator, by any act or omission, directs, permits, or fails to prevent a termination of service while any residential unit receiving that service is occupied, the corporation may commence an action for the recovery of all of the following:
Delinquent charges accruing prior to the expiration of the notice prescribed by subdivision (a).
Reasonable costs incurred by the corporation related to the restoration of service.
Reasonable attorney’s fees of the corporation incurred in the enforcement of this section or in the collection of delinquent charges, including, but not limited to, enforcement of a lien.
If the court finds that the owner, manager, or operator has paid the amount in arrears prior to termination, the court shall allow no recovery of any charges, costs, damages, expenses, or fees under this subdivision from the owner, manager, or operator.
An abstract of any money judgment entered pursuant to subdivision (f) or (g) of this section shall be recorded pursuant to Section 697.310 of the Code of Civil Procedure.
No termination of service subject to this section may be effected without compliance with this section, and any service wrongfully terminated shall be restored without charge to the residential occupants or customer for the restoration of the service. In the event of a wrongful termination by the corporation, the corporation shall, in addition, be liable to the residential occupants or customer for actual damages resulting from the termination and for the costs of enforcement of this section, including, but not limited to, reasonable attorney’s fees, if the residential occupants or the representative of the residential occupants made a good faith effort to have the service continued without interruption.
The commission shall adopt rules and orders necessary to implement this section and shall liberally construe this section to accomplish its purpose of ensuring that service to residential occupants is not terminated due to nonpayment by the customer unless the corporation has made every reasonable effort to continue service to the residential occupants. The rules and orders shall include, but are not limited to, reasonable penalties for a violation of this section, guidelines for assistance to residents in the enforcement of this section, and requirements for the notice prescribed by subdivision (a), including, but not limited to, clear wording, large and boldface type, and comprehensive instructions to ensure full notice to the resident.
Nothing in this section broadens or restricts any authority of a local agency that existed prior to January 1, 1989, to adopt an ordinance protecting a residential occupant from the involuntary termination of residential public utility service.
This section preempts any statute or ordinance permitting punitive damages against any owner, manager, or operator on account of an involuntary termination of residential public utility service or permitting the recovery of costs associated with the formation, maintenance, and termination of a tenants’ association.
For purposes of this section, “representative of the residential occupants” does not include a tenants’ association.
The commission shall adopt rules and regulations, which shall become effective on July 1, 1977, relating to safety appliances and procedures for rail transit services operated at grade and in vehicular traffic. The rules and regulations shall include, but not be limited to, provisions on grade crossing protection devices, headways, and maximum operating speeds with respect to the speed and volume of vehicular traffic within which the transit service is operated.
The commission shall submit the proposed rules and regulations to the Legislature not later than April 1, 1977.
No electrical, gas, heat, or water corporation may terminate residential service for nonpayment of a delinquent account unless the corporation first gives notice of the delinquency and impending termination, as provided in Section 779.1.
No electrical, gas, heat, or water corporation may terminate residential service for nonpayment in any of the following situations:
During the pendency of an investigation by the corporation of a customer or subscriber dispute or complaint.
When a customer has been granted an extension of the period for payment of a bill.
On the certification of a licensed physician and surgeon that to do so will be life threatening to the customer and the customer is financially unable to pay for service within the normal payment period and is willing to enter into an amortization agreement with the corporation pursuant to subdivision (e) with respect to all charges that the customer is unable to pay prior to delinquency.
Any residential customer who has initiated a complaint or requested an investigation within five days of receiving the disputed bill, or who has, before termination of service, made a request for extension of the payment period of a bill asserted to be beyond the means of the customer to pay in full within the normal period for payment, shall be given an opportunity for review of the complaint, investigation, or request by a review manager of the corporation. The review shall include consideration of whether the customer shall be permitted to amortize any unpaid balance of the delinquent account over a reasonable period of time, not to exceed 12 months. No termination of service shall be effected for any customer complying with an amortization agreement, if the customer also keeps the account current as charges accrue in each subsequent billing period.
Any customer whose complaint or request for an investigation pursuant to subdivision (c) has resulted in an adverse determination by the corporation may appeal the determination to the commission. Any subsequent appeal of the dispute or complaint to the commission is not subject to this section.
Any customer meeting the requirements of paragraph (3) of subdivision (b) shall, upon request, be permitted to amortize, over a period not to exceed 12 months, the unpaid balance of any bill asserted to be beyond the means of the customer to pay within the normal period for payment.
Every electrical, gas, heat, or water corporation shall allow every residential customer at least 19 days from the date of mailing its bill for services, postage prepaid, for payment of the charges demanded. A corporation subject to this section shall not terminate residential service for nonpayment of a delinquent account unless the corporation first gives notice of the delinquency and impending termination, at least 10 days prior to the proposed termination, by means of a notice mailed, postage prepaid, to the customer to whom the service is billed, not earlier than 19 days from the date of mailing the corporation’s bill for services, and the 10-day period shall not commence until five days after the mailing of the notice.
Every corporation shall make a reasonable attempt to contact an adult person residing at the premises of the customer by telephone or personal contact at least 24 hours prior to any termination of service, except that, whenever telephone or personal contact cannot be accomplished, the corporation shall give, either by mail or in person, a notice of termination of service at least 48 hours prior to termination.
Every corporation shall make available to its residential customers who are 65 years of age or older, or who are dependent adults as defined in Section 15610.23 of the Welfare and Institutions Code, a third-party notification service, whereby the corporation will attempt to notify a person designated by the customer to receive notification when the customer’s account is past due and subject to termination. The notification shall include information on what is required to prevent termination of service. The residential customer shall make a request for third-party notification on a form provided by the corporation, and shall include the written consent of the designated third party. The third-party notification does not obligate the third party to pay the overdue charges, nor shall it prevent or delay termination of service.
Every notice of termination of service pursuant to subdivision (a) or (b) shall include all of the following information:
The name and address of the customer whose account is delinquent.
The amount of the delinquency.
The date by which payment or arrangements for payment is required in order to avoid termination.
The procedure by which the customer may initiate a complaint or request an investigation concerning service or charges.
The procedure by which the customer may request amortization of the unpaid charges.
The procedure for the customer to obtain information on the availability of financial assistance, including private, local, state, or federal sources, if applicable.
The telephone number of a representative of the corporation who can provide additional information or institute arrangements for payment.
The telephone number of the commission to which inquiries by the customer may be directed.
All written notices shall be in a clear and legible format.
Any residential customer whose complaint or request for an investigation has resulted in an adverse determination by the corporation may appeal the determination to the commission. Any subsequent appeal of the dispute or complaint to the commission is not subject to this section.
If a residential customer fails to comply with an amortization agreement, the corporation shall not terminate service without giving notice to the customer at least 48 hours prior to termination of the conditions the customer is required to meet to avoid termination, but this notice does not entitle the customer to further investigation by the corporation.
A termination of service shall not be effected without compliance with this section. Any service wrongfully terminated shall be restored without charge for the restoration of service, and a notation thereof shall be mailed to the customer at the customer’s billing address.
No electrical, gas, heat, telephone, or water corporation may terminate residential service for nonpayment of any delinquent account or other indebtedness owed by the customer or subscriber to any other person or corporation or when the obligation represented by the delinquent account or other indebtedness was incurred with a person or corporation other than the electrical, gas, heat, telephone, or water corporation demanding payment therefor.
Subdivision (a) does not apply to a telephone corporation operating within service areas which furnishes billing services to the subscribers of a telephone corporation operating between service areas pursuant to tariffs on file with the commission providing for the furnishing of those billing services. The commission shall require that these tariffs also provide for adequate subscriber notice, review, and appeal procedures prior to any termination of service for nonpayment of a delinquent account.
A gas or electrical corporation shall not disconnect service for nonpayment by a residential customer receiving a medical baseline allowance pursuant to subdivision (c) of Section 739 who is financially unable to pay for service within the normal payment period, who is willing to enter into an amortization agreement with the corporation pursuant to subdivision (e) of Section 779 with respect to all charges that the customer is unable to pay, and who meets any of the following criteria:
The customer or a member of the customer’s household is under hospice care at home.
The customer or a member of the customer’s household depends upon life-support equipment, as defined in paragraph (2) of subdivision (c) of Section 739.
The customer or a member of the customer’s household has a life-threatening condition or illness, and a licensed physician, a person licensed pursuant to the Osteopathic Initiative Act, a physician assistant practicing within his or her scope of practice in compliance with the Physician Assistant Practice Act (Chapter 7.7 (commencing with Section 3500) of Division 2 of the Business and Professions Code), or a nurse practitioner certifies that gas or electric service is medically necessary to sustain the life of the person or prevent deterioration of the person’s medical condition.
The commission may identify strategies for reasonable cost recovery by a gas or electrical corporation for costs incurred in providing gas or electric service to customers whom the gas or electrical corporation was unable to disconnect due to compliance with this section.
A gas or electrical corporation may institute a verification process to implement this section.
For purposes of this section, “energy utility” means an electrical corporation, a gas corporation, or an entity that is both an electrical corporation and a gas corporation.
The commission shall develop rules requiring each of the four energy utilities that have the greatest number of customers in California to demonstrate that they are working with the medical community to increase marketing and outreach to persons eligible for the medical baseline allowance pursuant to subdivision (c) of Section 739.
The commission shall consider policies to increase marketing and outreach programs to customers eligible for the medical baseline allowance pursuant to subdivision (c) of Section 739, in coordination with county public health departments.
The decision of an electrical, gas, heat, telephone, or water corporation to require a new residential applicant to deposit a sum of money with the corporation prior to establishing an account and furnishing service shall be based solely upon the credit worthiness of the applicant as determined by the corporation.
An electrical or gas corporation shall restore service to a residential customer whose service was previously terminated for nonpayment of delinquent amounts upon the customer entering into either an amortization agreement described in subdivision (c) of Section 779 or any other arrearage payment plan determined by the commission.
To the extent authorized by commission rules, the restoration of service shall occur as follows:
Within 24 hours of the payment for remote reconnections.
Within one business day for field reconnections, except in situations relating to safety or extreme weather.
On or before July 1, 2025, the commission shall, in a new or existing proceeding, determine whether to direct electrical and gas corporations to take into account a customer’s ability to pay in any of the following circumstances:
Before terminating service due to nonpayment.
Before terminating service for a customer on an amortization agreement.
In reconnecting service for a residential customer whose service was previously terminated for nonpayment.
In determining whether to direct electrical corporations to consider a customer’s ability to pay before terminating service, the commission shall consider whether to limit the amount an electrical corporation can collect up to an amount specified by the commission.
The commission shall consider impacts to participating and nonparticipating customers to inform the determinations made pursuant to subdivision (a).
No electrical, gas, heat, or water corporation shall, by reason of delinquency in the payment of its charges, terminate service on any Saturday, Sunday, legal holiday, or at any time during which the business offices of the corporation are not open to the public.
The commission shall require every residential unit in an apartment house or similar multiunit residential structure, condominium, and mobilehome park for which a building permit has been obtained on or after July 1, 1982, other than a dormitory or other housing accommodation provided by any postsecondary educational institution for its students or employees and other than farmworker housing, to be individually metered for electrical and gas service, except that separate metering for gas service is not required for residential units which are not equipped with gas appliances requiring venting or are equipped with only vented decorative appliances or which receive the majority of energy used for water or space heating from a solar energy system or through cogeneration technology.
Each water corporation with less than 500 service connections as of January 1, 2010, that thereafter reaches 500 or more service connections and that is not subject to the requirements of Section 526, 527, or 528 of the Water Code, shall, within 10 years of attaining that threshold, install a water meter upon each unmetered service connection.
Each water corporation that has installed water meters, or caused water meters to be installed, that is not subject to Section 525, 526, 527, or 528 of the Water Code, shall, on and after January 1, 2015, charge customers for potable water based on the actual volume of deliveries, as measured by the water meter. This paragraph does not limit the authority of the commission to authorize a water corporation that promotes conservation through volumetric water pricing to determine and impose a rate, fee, or charge in addition to the charge for the actual volume of metered water delivered.
Notwithstanding paragraph (1), in order to provide customers with experience in volume-based water service charges, a water corporation that is subject to paragraph (1) may delay, for one annual seasonal cycle of water use, the use of meter-based charges for service connections that are being converted from nonvolume-based billing to volume-based billing.
A water corporation shall recover the cost of providing services related to the purchase, installation, operation, and maintenance of water meters in rates, fees, or charges. Rates, fees, or charges recovered by the water corporation pursuant to this section are subject to approval by the commission pursuant to Article 1 (commencing with Section 451) of Chapter 3 and Article 2 (commencing with Section 727) of this chapter.
The commission shall ensure that each water corporation that is subject to the requirements of this section or the requirements of the Water Measurement Law (Chapter 8 (commencing with Section 500) of Division 1 of the Water Code) comply with those requirements.
The commission may require a water corporation that furnishes potable water for residential, commercial, industrial, or institutional use through less than 500 service connections that is not subject to the requirements of Section 526, 527, or 528 of the Water Code, or a residential, commercial, industrial, or institutional customer of the corporation, to install a water meter at any water service connection between the water system of the corporation and the customer if after a public hearing held within the service area of the corporation, the commission finds, based upon the evidence presented at that hearing, that any of the following are true:
Metering will be cost effective within the service area of the corporation.
Metering will result in a reduction in water consumption within the service area of the corporation.
The costs of metering will not impose an unreasonable financial burden on customers within the service area of the corporation unless it is found to be necessary to ensure continuation of an adequate water supply within the service area of the corporation.
In order to encourage the development of geothermal resources in the State of California, the commission may, upon a complaint by a geothermal energy producer, prohibit any electrical corporation from curtailing the generation, production, or transmission of electricity from a geothermal powerplant operated by such corporation, if the commission deems that such curtailment is not in the public interest.
The commission shall continue to enforce the rules governing the extension of service by gas and electrical corporations to new residential, commercial, agricultural, and industrial customers in effect on January 1, 1982, except that the commission shall amend the existing rules to permit applicants for service to install extensions in accordance with subdivision (f). Except for periodic review provisions of existing rules, and amendments to permit installations by an applicant’s contractor, the commission shall not investigate amending these rules or issue any orders or decisions that amend these rules, unless the investigation or proceeding for the issuance of the order or decision is conducted pursuant to subdivision (b).
Whenever the commission institutes an investigation into the terms and conditions for the extension of services provided by gas and electrical corporations to new or existing customers, or considers issuing an order or decision amending those terms or conditions, the commission shall make written findings on all of the following issues:
The economic effect of the line and service extension terms and conditions upon agriculture, residential housing, mobilehome parks, rural customers, urban customers, employment, and commercial and industrial building and development.
The effect of requiring new or existing customers applying for an extension to an electrical or gas corporation to provide transmission or distribution facilities for other customers who will apply to receive line and service extensions in the future.
The effect of requiring a new or existing customer applying for an extension to an electrical or gas corporation to be responsible for the distribution of, reinforcements of, relocations of, or additions to that gas or electrical corporation.
The economic effect of the terms and conditions upon projects, including redevelopment projects, funded or sponsored by cities, counties, or districts.
The effect of the line and service extension regulations, and any modifications to them, on existing ratepayers.
The effect of the line and service extension regulations, and any modifications to them, on the consumption and conservation of energy.
The extent to which there is cost-justification for a special line and service extension allowance for agriculture.
The commission shall request the assistance of appropriate state agencies and departments in conducting any investigation or proceeding pursuant to subdivision (b), including, but not limited to, the Transportation Agency, the Department of Food and Agriculture, the Department of Consumer Affairs, the Bureau of Real Estate, and the Department of Housing and Community Development.
Any new order or decision issued pursuant to an investigation or proceeding conducted pursuant to subdivision (b) shall become effective on July 1 of the year that follows the year when the new order or decision is adopted by the commission, so as to ensure that the public has at least six months to consider the new order or decision.
The commission shall conduct any investigation or proceeding pursuant to subdivision (b) within the commission’s existing budget, and any state agency or department that is requested by the commission to provide assistance pursuant to subdivision (c) shall also provide the assistance within the agency’s or department’s existing budget.
An electrical or gas corporation shall permit a new or existing customer who applies for an extension of service from that corporation to install a gas or electric extension in accordance with the regulations of the commission and applicable specifications of that electrical or gas corporation consistent with subdivision (g).
Only those construction and design specifications, standards, terms, and conditions that are applicable to a new extension-of-service project by an electrical or gas corporation on the date the application is approved for the extension of service apply to the new project for the 18 months following the approval date of the application.
Notwithstanding paragraph (1), an electrical or gas corporation may adopt modifications to construction and design specifications, standards, terms, and conditions applicable to a new extension-of-service project in accordance with any of the following:
An order or decision of the commission or any other state or federal agency with jurisdiction.
A work order issued by the electrical or gas corporation to implement construction or design changes necessitated by a customer-driven scope of work modification.
A material-related design change identified by the electrical or gas corporation to remedy a construction material defect that could pose a risk to public safety.
For purposes of this section, the following definitions apply:
“The date the application is approved” means the earlier of either the effective date of the contract for the extension of gas or electric service or the date when the utility first invoices the customer for the extension of gas or electric service.
“Customer-driven scope of work modification” means those modifications required to accommodate the construction and design needs of a new extension-of-service project for a specific customer.
“Invoice” means when an electrical or gas corporation presents an offer to the customer for the extension of gas or electric service in response to an application for an extension of service submitted pursuant to subdivision (f).
For purposes of this section, the following terms have the following meanings:
“Disadvantaged community” means a San Joaquin Valley community that meets all of the following criteria:
At least 25 percent of residential households with electrical service are enrolled in the CARE program pursuant to Section 739.1.
Has a population greater than 100 persons within its geographic boundaries as identified by the most recent United States Census or a community survey.
Has geographic boundaries no farther than seven miles from the nearest natural gas pipeline operated by a gas corporation.
“San Joaquin Valley” means the counties of Fresno, Kern, Kings, Madera, Merced, San Joaquin, Stanislaus, and Tulare.
No later than March 31, 2015, the commission shall initiate a new proceeding to do all of the following:
Identify disadvantaged communities based on the criteria specified in subdivision (a).
Analyze the economic feasibility of the following options:
Extending natural gas pipelines to those disadvantaged communities.
Increasing subsidies for electricity for residential customers in those disadvantaged communities.
Other alternatives that would increase access to affordable energy in those disadvantaged communities that the commission deems appropriate.
The commission shall determine whether any of the options analyzed in the proceeding would increase access to affordable energy in a cost-effective manner. For these options, the commission shall take appropriate action and determine appropriate funding sources.
For each gas corporation, the commission shall adopt pipeline access rules that ensure that each gas corporation provides nondiscriminatory open access to its gas pipeline system to any party for the purposes of physically interconnecting with the gas pipeline system and effectuating the delivery of gas.
The Legislature requests that the California Council on Science and Technology undertake and complete a study analyzing the regional and gas corporation specific issues relating to minimum heating value and maximum siloxane specifications for biomethane before it can be injected into common carrier gas pipelines, including those specifications adopted in Sections 4.4.3.3 and 4.4.4 of commission Decision 14-01-034 (January 16, 2014), Decision Regarding the Biomethane Implementation Tasks in Assembly Bill 1900. The study shall consider and evaluate other states’ standards, the source of biomethane, the dilution of biomethane after it is injected into the pipeline, the equipment and technology upgrades required to meet the minimum heating value specifications, including the impacts of those specifications on the cost, volume of biomethane sold, equipment operation, and safety. The study shall also consider whether different sources of biogas should have different standards or if all sources should adhere to one standard for the minimum heating value and maximum permissible level of siloxanes. The study shall develop the best science reasonably available and not merely be a literature review. In order to meet the state’s goals for reducing emissions of greenhouse gases and short-lived climate pollutants and the state’s goals for promoting the use of renewable energy resources in place of burning fossil fuels, the California Council on Science and Technology, if it agrees to undertake and complete the study, shall complete the study within nine months of entering into a contract to undertake and complete the study.
If the California Council on Science and Technology agrees to undertake and complete the study pursuant to subdivision (a), the commission shall require each gas corporation operating common carrier pipelines in California to proportionately contribute to the expenses to undertake the study pursuant to Sections 740 and 740.1. The commission may modify the monetary incentives made available pursuant to commission Decision 15-06-029 (June 11, 2015), Decision Regarding the Costs of Compliance with Decision 14-01-034 and Adoption of Biomethane Promotion Policies and Program, to allocate some of the moneys that would be made available for incentives to instead be made available to pay for the costs of the study so as to not further burden ratepayers with additional expense.
The commission’s authority pursuant to paragraph (1) shall apply notwithstanding whether the gas corporation has proposed the program pursuant to Section 740.1.
If the California Council on Science and Technology agrees to undertake and complete the study pursuant to subdivision (a), within six months of its completion, the commission shall reevaluate its requirements and standards adopted pursuant to Section 25421 of the Health and Safety Code relative to the requirements and standards for biomethane to be injected into common carrier pipelines and, if appropriate, change those requirements and standards or adopt new requirements and standards, giving due deference to the conclusions and recommendations made in the study by the California Council on Science and Technology.
Before the exhaustion of the funds made available pursuant to the monetary incentive program for biomethane projects adopted in Decision 15-06-029 (June 11, 2015), Decision Regarding the Costs of Compliance with Decision 14-01-034 and Adoption of Biomethane Promotion Policies and Program, and no later than July 1, 2019, the commission shall open a proceeding to consider options to further the goals of Section 399.24, including consideration of whether to allow recovery in rates of the costs of investments to do each of the following:
Ensure that prudent and reasonable investments for infrastructure pursuant to subdivisions (b) and (c) provide a direct benefit, such as safety, reliability, affordability, or reducing emissions of greenhouse gases, to all classes of ratepayers and are in the interests of all classes of ratepayers.
Facilitate direct investment in the procurement and installation of utility infrastructure necessary to achieve interconnection between the natural gas transmission and distribution pipeline network and biomethane generation and collection equipment, and of gathering lines for a dairy cluster biomethane project.
Provide for the installation of utility infrastructure to achieve interconnection with facilities that generate biomethane.
To the extent consistent with federal law and regulation and contractual obligations regarding other available gas, the commission shall, in consultation with the Division of Oil and Gas of the Department of Conservation and with the Energy Commission, encourage, as a first priority, the increased production of gas in this state, including gas produced from that area of the Pacific Ocean along the coast of California commonly known as the outer continental shelf, and shall require, after a hearing, every gas corporation to purchase that gas which is compatible with the corporation’s gas plant and which is produced in this state having an actual delivered cost, measured in equivalent heat units, equal to or less than other available gas, unless this requirement will result in higher overall costs of gas or other consequences adverse to the interests of gas customers.
The commission shall require, after a hearing, every gas corporation to revise its transportation tariffs and conditions of service to eliminate all components that assess shippers of gas produced in California for the costs of interstate transmission of gas produced outside of this state. These revisions shall eliminate direct or indirect charges for the interstate transportation of gas produced outside of this state, commonly referred to as “double demand” charges.
The commission shall consider and approve tariffs consistent with subdivision (a) on or before October 1, 1994.
Nothing in this section shall be construed to prohibit the commission from approving intrastate transmission tariffs which include interstate transition cost surcharges, as described in commission decisions 91-11-025 and 92-07-025, in an appropriate manner.
The commission shall investigate, as part of the rate proceeding for any gas corporation, impediments to the in-state production and storage of natural gas. The commission may adopt a tariff that encourages in-state production or storage of natural gas, including, but not limited to, reducing local transmission rates applicable to in-state gas blends, unless the commission finds that adopting the tariff will likely result in consequences adverse to the interests of gas customers.
The commission shall require every gas corporation to adopt and pursue purchasing and procurement practices which assure its customers the lowest rates consistent with security of supply and with Section 785.
Pursuant to subdivision (a), the commission may establish and periodically revise for each gas corporation guidelines for priorities among suppliers and sources of supply of gas to gas corporations, taking into consideration the requirements of Section 785. The establishment of these guidelines does not relieve a gas corporation of any requirement to make reasonable and prudent purchases of gas or diminish the authority of the commission to review the reasonableness of any purchase or procurement decision of the corporation.
No gas corporation shall charge, directly or indirectly, a higher rate for the transportation of gas produced in this state than for the transportation of gas from any other source. No gas corporation shall require a producer of gas or a customer for whom any gas transportation service is performed to utilize the corporation’s services or facilities either to deliver gas from the producer’s facility to the corporation’s gas plant or to process the gas to render it compatible with the corporation’s gas plant.
If a producer of gas or customer delivers to the gas corporation for transportation any gas requiring any processing service, including, but not limited to, dehydration, processing for extraction of liquids, or other purification, different from, or in addition to, that performed on other gas in the corporation’s gas plant, in order for that gas to be compatible with the gas plant, the gas corporation may impose a charge for any such service actually performed. If the gas corporation constructs new facilities at the request of the producer or customer exclusively to receive gas by the gas corporation’s gas plant, the gas corporation may impose a charge for the construction, operation, and maintenance of these facilities. The amount of the charge for the processing service or facilities authorized by this subdivision shall be established by the commission and shall be based on the actual expenses for the construction, operation, maintenance, labor, materials, and overhead involved in providing the specific service or facilities.
For purposes of this section, “transportation” means the movement of gas from the point of receiving by the gas plant of a gas corporation to the point of delivery to the person or corporation for whom the transportation service is performed, including any related gathering or processing of the gas. The point of receiving by the gas plant is that point in the gas corporation’s existing plant which is nearest the source of the gas and which has receiving capacity, but does not include any new facility constructed by the gas corporation at the request of the producer or customer exclusively to receive that gas. The terms and conditions of receiving, for these purposes, shall be comparable to the gas corporation’s purchase contracts in the general area of the point of receiving.
Subdivision (a) does not apply to exchanges of gas between a gas corporation and a producer of gas.
The commission shall allow the gas corporation to fully recover all reasonable and prudent costs associated with ownership and operation of the gas plant used for transportation.
On or before March 1, 1984, and annually thereafter, every telephone corporation operating within a service area shall issue to each of its residential subscribers, in a manner and form approved by the commission, a listing of the residential telephone services it provides, the rates or charges for those services, and the state or federal regulatory agency or agencies responsible for regulation of those services.
On or before March 1, 1988, and annually thereafter, every telephone corporation operating within a service area providing public telephone service shall provide to each of its residential subscribers, in a manner and form approved by the commission, a description of that public telephone service and the telephone corporation’s policies for providing that service, which shall include policies of public need and safety. The description shall also specify how a customer or subscriber can contact the telephone corporation by telephone or mail, or both, for additional information concerning these public telephone policies or for assistance regarding a specific public telephone. The commission shall require that this information be published separately from, but transmitted to subscribers together with, the information specified in subdivision (a).
This subdivision does not apply to any corporation or person which owns or operates coin-activated telephone equipment available for public use but which is not a telephone corporation.
Every charge imposed on business or residential telephone subscribers in response to rules or regulations of the Federal Communications Commission shall be shown separately from other charges on a subscriber’s billing statement. Every telephone corporation operating within a service area shall do either of the following:
Identify these charges, by asterisk or other means, with the following phrase:
THIS CHARGE IS (or THESE CHARGES ARE) IMPOSED BY ACTION OF THE FEDERAL COMMUNICATIONS COMMISSION.
Include in the subscriber’s billing statement a listing of the total charges imposed pursuant to tariff of the Federal Communications Commission identified with the following phrase:
TOTAL CHARGES IMPOSED BY ACTION OF THE FEDERAL COMMUNICATIONS COMMISSION.
The billing statement shall also provide the address and telephone number of the Federal Communications Commission to which inquiries may be directed.
The commission shall, by rule or order, specify methods for compliance with this section, which shall include all of the following:
A description of billing charges which may appear on the telephone corporation’s or the telecommunications provider’s billing statements.
Procedures the subscribers, including subscribers equipped with telephone devices for the handicapped, may follow to protest items billed to the subscriber, and how to contact the telephone corporation or the telecommunications provider concerning those charges.
Any public utility, or its contractor, to whom an excavation permit has been issued by any local agency for the installation, removal, maintenance, or repair of underground facilities may backfill the permitted excavation in any public road or highway with native spoil if all of the following conditions are met:
The native spoil is competent spoil.
Compaction meets the local agency’s requirements using industry standards for testing compaction.
The public utility or its contractor has no physical evidence of, or substantial reason to believe that there has been, contamination of the soil from hazardous wastes.
Within 30 days prior to compaction, a local agency has not provided the public utility or its contractor with physical evidence of, or substantial reason to believe that there has been, contamination of the soil from hazardous wastes.
If a local agency has determined through prior experience that the public utility that is applying for, or benefiting from, the excavation permit has previously neglected to adequately fill or compact prior excavations, whether directly or through its contractors, the local agency may, as a condition of the excavation permit do either or both of the following:
Require the public utility to post a bond, with a term not exceeding one year, amounting to two times the cost for the local agency to repair the backfill work, if done improperly, or any related collateral damage.
Require the public utility to submit a report from a registered soils engineer that the proper compaction of the excavation has been achieved.
For purposes of this section:
“Public utility” means any electrical corporation, gas corporation, heat corporation, water corporation, telephone corporation, pipeline corporation, sewer corporation, telegraph corporation, where the service is performed for, or the commodity delivered to, the public or any portion thereof.
This section applies only to a telephone corporation that is a provider of local exchange service.
On or before March 1, 1992, and annually thereafter, every telephone corporation that is a provider of local exchange service shall issue to each of its residential subscribers, in a manner and form approved by the commission, a notice containing the following information:
An explanation of the responsibilities of the subscriber and the telephone corporation in relation to the customer’s inside telephone wiring, as that term is defined by and pursuant to Section 1941.4 of the Civil Code, including an explanation of lessor and tenant obligations.
An explanation of the telephone corporation’s procedures and charges for determining and notifying the subscriber of whether a malfunction in its telephone wire is located in the telephone network, or is located in the subscriber’s inside telephone wiring, including customer-provided equipment.
If the telephone corporation offers any services to maintain or repair a subscriber’s inside telephone wiring, a full description of the types of services offered, including the rates, charges, and conditions for these services, and whether those services are offered by nonutility providers.
ARTICLE 3.5. Water Utility Infrastructure, Plant and Facilities [789. - 790.1.]
This article shall be known and may be cited as the Water Utility Infrastructure Improvement Act of 1995.
The Legislature finds and declares all of the following:
Water corporations currently are faced with, and will continue to be faced with, increasing demands for new infrastructure, plant, and facilities to comply with increasingly strict state and federal safe drinking water laws and regulations.
The state’s limited water supply will require investment by water corporations in infrastructure, plant, and facilities to develop new sources of supply, make existing sources of supply more reliable, and encourage and implement water conservation measures including water reclamation and reuse.
Water corporations also are faced with the need to replace or upgrade water infrastructure, plant, and facilities and to design and construct all of those replacements and improvements to meet the governing fire flow standards for public fire protection purposes.
Water corporations may, from time to time, own real property that once was, but is no longer, necessary or useful in the provision of water utility service and that now may be sold. It is the policy of the state that water corporations be encouraged to dispose of real property that once was, but is no longer, necessary or useful in the provision of water utility service and to invest the net proceeds therefrom in utility infrastructure, plant, facilities, and properties that are necessary or useful in the provision of water service to the public.
It is the policy of the state that any net proceeds from the sale by a water corporation of real property that was at any time, but is no longer, necessary or useful in the provision of public utility service, shall be invested by a water corporation in infrastructure, plant, facilities, and properties that are necessary or useful in the performance of its duties to the public and that all of that investment in infrastructure, plant, facilities, and properties shall be included among the other utility property of the water corporation that is used and useful in providing water service and upon which the commission authorizes the water corporation the opportunity to earn a reasonable return.
Whenever a water corporation sells any real property that was at any time, but is no longer, necessary or useful in the performance of the water corporation’s duties to the public, the water corporation shall invest the net proceeds, if any, including interest at the rate that the commission prescribes for memorandum accounts, from the sale in water system infrastructure, plant, facilities, and properties that are necessary or useful in the performance of its duties to the public. For purposes of tracking the net proceeds and their investment, the water corporation shall maintain records necessary to document the investment of the net proceeds pursuant to this article. The amount of the net proceeds shall be a water corporation’s primary source of capital for investment in utility infrastructure, plant, facilities, and properties that are necessary or useful in the performance of the water corporation’s duties in providing water utility service to the public.
All water utility infrastructure, plant, facilities, and properties constructed or acquired by, and used and useful to, a water corporation by investment pursuant to subdivision (a) shall be included among the water corporation’s other utility property upon which the commission authorizes the water corporation the opportunity to earn a reasonable return.
This article shall apply to the investment of the net proceeds referred to in subdivision (a) for a period of 8 years from the end of the calendar year in which the water corporation receives the net proceeds. The balance of any net proceeds and interest thereon that is not invested after the eight-year period shall be allocated solely to ratepayers.
Upon application by a water corporation with 10,000 or fewer service connections, the commission may, after a hearing, by rule or order, exempt the water corporation from the requirements of this article.
The commission retains continuing authority to determine the used, useful, or necessary status of any and all infrastructure improvements and investments.
In any proceeding pending after January 1, 1996, the commission shall apply this article in its consideration of any matter concerning the sale by a water corporation of real property that is not necessary or useful in the provision of water utility service, for any sale that occurred prior to that date. If the water corporation has not invested the net proceeds therefrom in utility infrastructure, plant, facilities, and properties that are necessary or useful in the provision of water service to the public, it may elect to do so during the period provided in subdivision (c) of Section 790 and that period shall be deemed to have commenced as of January 1, 1996.
ARTICLE 4. Books and Accounts [791. - 799.]
Each public utility shall have an office in a county of this State in which its property or some portion thereof is located and shall keep in that office all the books, accounts, papers, and records required by the commission to be kept within this State. No such books, accounts, papers, or records shall be at any time removed from the State except upon such conditions as the commission prescribes.
The commission may establish a system of accounts to be kept by the public utilities subject to its jurisdiction, or classify such public utilities and establish a system of accounts for each class, and may prescribe the manner in which such accounts shall be kept. It may also prescribe the forms of accounts, records, and memoranda to be kept by such public utilities, including the accounts, records, and memoranda of the movement of traffic as well as the receipts and expenditures of moneys, and any other forms, records, and memoranda which in the judgment of the commission may be necessary to carry out any of the provisions of this part.
Whenever the commission authorizes any change in rates reflecting and passing through to customers specific changes in costs, except rates set for common carriers, the commission shall require as a condition of the order that the public utility establish and maintain a balancing account reflecting the balance, whether positive or negative, between the related costs and revenues, and the commission shall take into account by appropriate adjustment or other action any positive or negative balance remaining in the balancing account at the time of any subsequent rate adjustment.
The commission shall develop a risk-based approach for reviewing or auditing balancing accounts periodically to ensure that the transactions recorded in the balancing accounts are for allowable purposes and are supported by appropriate documentation.
The commission shall maintain an inventory of the balancing accounts established pursuant to this section.
The commission shall require the public utility to record all related costs and revenues in the balancing account, unless those costs or revenues are specifically exempted by the commission.
The commission shall adopt balancing account review or audit procedures that are consistent with a risk-based approach.
The commission may forgo the review or audit of a balancing account pursuant to this section if an independent auditor has reviewed or audited the balancing account in the preceding five years.
The system of accounts and the forms of accounts, records, and memoranda prescribed by the commission for corporations subject to the regulatory authority of the United States, shall not be inconsistent with the systems and forms from time to time established for such corporations by or under the authority of the United States. Nothing in this section or Section 794 shall affect the power of the commission to prescribe forms of accounts, records, and memoranda covering information in addition to that required by or under the authority of the United States.
The commission may, after notice, and hearing if requested within 15 days after receipt of notice, prescribe by order the accounts in which particular outlays and receipts shall be entered, charged, or credited. Where the commission has prescribed the forms of accounts, records, or memoranda to be kept by any public utility for any of its business, it is unlawful for such public utility to keep any accounts, records, or memoranda for such business other than those so prescribed, or those prescribed by or under the authority of any other state or of the United States, except such accounts, records, or memoranda as are explanatory of and supplemental to those prescribed by the commission.
The commission may, after hearing if requested, require any or all public utilities to carry a proper and adequate depreciation account in the form and in accordance with such rules as the commission prescribes. The commission may, from time to time, ascertain and by order fix the proper and adequate rates of depreciation of the several classes of property of each public utility.
The commission shall disallow, for purposes of setting the rates to be charged by any electrical, gas, or heat corporation for the services or commodities furnished by it, all expenses for advertising which encourage increased consumption of such services or commodities.
Notwithstanding subdivision (a), the commission may allow, for purposes of setting rates, expenses for advertising which encourages the more efficient operation of the electric, gas, or heating plant, or for advertising which encourages the more efficient use of electricity, gas, or heat or the conservation of energy or natural resources, or presents accurate information on the economical purchase, maintenance, or effective use of electrical or gas appliances and devices.
The commission shall periodically audit, or direct that an independent audit be periodically conducted for, all significant transactions, as specified by the commission, between a water corporation with more than 2,000 service connections, or an electrical, gas, or telephone corporation, and every subsidiary or affiliate of, or corporation holding a controlling interest in, that water, electrical, gas, or telephone corporation. The commission, in this connection, may utilize the services of an independent auditor, who shall be selected and supervised by the commission, or may direct a water corporation with more than 2,000 service connections, or an electrical, gas, or telephone corporation, to utilize the services of an independent auditor, who shall be selected and supervised by that water, electrical, gas, or telephone corporation. Nothing in this section prohibits the commission from auditing any transaction between a water corporation with more than 2,000 service connections, or an electrical, gas, or telephone corporation, and any subsidiary or affiliate of, or corporation holding a controlling interest in, that water, electrical, gas, or telephone corporation, as otherwise permitted or required by law.
Whenever the commission finds and determines that any water corporation with more than 2,000 service connections, or an electrical, gas, or telephone corporation, has willfully made an imprudent payment to, or received a less than reasonable payment from, any subsidiary or affiliate of, or corporation holding a controlling interest in, the water, electrical, gas, or telephone corporation in violation of any rule or order of the commission, adopted and published by the commission prior to the transaction but after notice to, and an opportunity to comment by, the affected corporation, and the corporation has sought to recover the payment in any proceeding before the commission, the commission, following a hearing, may levy a penalty against the corporation not to exceed three times the required or prohibited payment, as the case may be, if the commission finds that the payment, in whole or part, was made or received by the corporation for the purpose of benefiting its subsidiary, affiliate, or holding corporation. This penalty is in addition to any criminal penalties which may apply.
In determining whether to impose a civil penalty under this section, the commission may take into consideration multistate public utility diversification activities involving cross-subsidization which are permissible in other states or under federal jurisdiction although in violation of the commission’s rules and orders.
With respect to all taxes enacted by any local jurisdiction, including any city, county, or city and county, including a chartered city or county, any district, including an agency of the state, formed pursuant to general law or special act, for the local performance of governmental or proprietary functions within limited boundaries, or any public or municipal corporation, and imposed on the customers of public utilities or other service suppliers, which taxes have been collected by the public utilities and other service suppliers and remitted to the local jurisdiction all of the following shall apply:
The public utility or other service supplier shall have no duty to independently investigate or inquire with the local jurisdiction concerning the validity of the tax ordinance.
In connection with any actions or claims relating to or arising from the invalidity of the tax ordinance, in whole or in part, the public utility or other service supplier shall not be liable to any customer as a consequence of collecting the tax.
In the event a local jurisdiction is ordered to refund the tax, it shall be the sole responsibility of the local jurisdiction to refund the tax. Unless a public utility or other service supplier is reimbursed by the local jurisdiction for the actual cost of assisting the local jurisdiction, including, but not limited to, calculating or verifying refunds, distributing refunds, providing data, or providing data processing assistance, the public utility or other service supplier shall not be required to assist the local jurisdiction to refund the tax, including, but not limited to, calculating or verifying refunds, distributing refunds, providing data, or providing data processing assistance.
In any action seeking to enjoin collection of taxes imposed on customers of utilities or other service suppliers and collected by the utilities or other service suppliers, in any action seeking declaratory relief concerning the taxes, in any action seeking a refund of the taxes, or in any action seeking otherwise to invalidate the taxes, the sole necessary party defendant in the action shall be the local jurisdiction on whose behalf the taxes are collected and the public utility or other service supplier collecting the taxes shall not be named as a party in the action.
If a local jurisdiction repeals the tax, reduces an existing tax rate, changes the tax base, or makes any other changes to the tax that would affect the collection and remittance of the tax, the local jurisdiction shall submit, on and after the effective date of the enactment of the change, a written notification and supply all requisite information to the public utility or service supplier, in accordance with the procedures established by the public utility or service supplier. The public utility or other service supplier shall not be required to implement the changes any earlier than 60 days from the date on which the public utility or other service provider receives the written notification and all other information required by the public utility or other service supplier. If the 60th day is not the first day of a month, then the public utility or other service provider shall implement the changes on the first day of the month following the month in which the 60th day occurs.
If a local jurisdiction adopts a new tax, the local jurisdiction shall submit, on and after the effective date of the adoption of the new tax, a written notification to the public utility or other service supplier, in accordance with procedures established by the public utility or other service supplier, requesting that the tax be collected. The public utility or other service supplier shall not be required to begin collecting the tax any earlier than 90 days from the date on which the public utility or other service provider receives written notification and all other information required by the public utility or other service supplier. If the 90th day is not the first day of a month, then the public utility or other service provider shall begin the tax collection on the first day of the month following the month in which the 90th day occurs. Nothing in this section shall be construed to prevent the public utility or other service provider from beginning the tax collection at an earlier date.
For purposes of this section, “other service supplier” shall include, but not be limited to, a holder of a state franchise issued pursuant to Section 5840.
The Legislature finds and declares that the limitations imposed by this section constitute an issue of statewide concern. The Legislature further finds and declares that the limitations imposed by this section are not municipal affairs as that term is used in Article XI of the California Constitution. Therefore, it is the intent of the Legislature that the limitations imposed by this section apply to all cities, counties, and cities and counties, including chartered cities and chartered counties, any district, including an agency of the state, formed pursuant to general law or special act, for the local performance of governmental or proprietary functions within limited boundaries, and any public or municipal corporation.
ARTICLE 5. Stocks and Security Transactions [816. - 830.]
The power of public utilities to issue stocks and stock certificates or other evidence of interest or ownership and bonds, notes, and other evidences of indebtedness and to create liens on their property situated within this State is a special privilege, the right of supervision, regulation, restriction, and control of which is vested in the State, and such power shall be exercised as provided by law under such rules as the commission prescribes.
Nothing in this article or in Article 6 (commencing with Section 851) requires a common carrier by railroad subject to the Interstate Commerce Act (49 U.S.C. Sec. 10101 et seq.) or passenger stage corporation to secure from the commission authority to execute any conditional sales contract for the purchase of motor vehicle or railroad equipment or any note or chattel mortgage on that equipment securing the payment of all, or any part, of the purchase price.
A public utility may issue stocks and stock certificates or other evidence of interest or ownership, and bonds, notes, and other evidences of indebtedness payable at periods of more than 12 months after the date thereof, for any one or more of the following purposes and no others:
For the acquisition of property.
For the construction, completion, extension, or improvement of its facilities.
For the improvement or maintenance of its service.
For the discharge or lawful refunding of its obligations.
For the financing of the acquisition and installation of electrical and plumbing appliances and agricultural equipment which are sold by other than a public utility, for use within the service area of the public utility.
For the reorganization or readjustment of its indebtedness or capitalization upon a merger, consolidation, or other reorganization.
For the retirement of or in exchange for one or more outstanding stocks or stock certificates or other evidence of interest or ownership of such public utility, or bonds, notes, or other evidence of indebtedness of such public utility, with or without the payment of cash.
For the reimbursement of moneys actually expended from income or from any other money in the treasury of the public utility not secured by or obtained from the issue of stocks or stock certificates or other evidence of interest or ownership, or bonds, notes, or other evidences of indebtedness of the public utility, for any of the aforesaid purposes except maintenance of service and replacements, in cases where the applicant has kept its accounts and vouchers for such expenditures in such manner as to enable the commission to ascertain the amount of money so expended and the purposes for which such expenditure was made.
No public utility may issue stocks and stock certificates, or other evidence of interest or ownership, or bonds, notes, or other evidences of indebtedness payable at periods of more than 12 months after the date thereof unless, in addition to the other requirements of law it shall first have secured from the commission an order authorizing the issue, stating the amount thereof and the purposes to which the issue or the proceeds thereof are to be applied, and that, in the opinion of the commission, the money, property, or labor to be procured or paid for by the issue is reasonably required for the purposes specified in the order, and that, except as otherwise permitted in the order in the case of bonds, notes, or other evidences of indebtedness, such purposes are not, in whole or in part, reasonably chargeable to operating expenses or to income.
To enable it to determine whether it will issue the order, the commission may hold a hearing and may make such additional inquiry or investigation, examine such witnesses, books, papers, documents, and contracts, and require the filing of such data as it deems of assistance. The commission may by its order grant permission for the issue of such stocks or stock certificates or other evidence of interest or ownership, or bonds, notes, or other evidences of indebtedness in the amount applied for, or in a lesser amount, or refuse such permission, or grant it subject to such conditions as it deems reasonable and necessary. The commission may authorize issues of bonds, notes, or other evidences of indebtedness, less than, equivalent to or greater than the authorized or subscribed capital stock of a public utility corporation.
The commission shall have no power to authorize the capitalization of the right to be a corporation, or the capitalization of any franchise or permit, or the right to own, operate, or enjoy any such franchise or permit, in excess of the amount (exclusive of any tax or annual charge) actually paid to the State or to a political subdivision thereof as the consideration for the grant of such franchise, permit, or right. No contract for consolidation or lease shall be capitalized, nor shall any public utility issue any bonds, notes, or other evidences of indebtedness against or as a lien upon any contract for consolidation or merger.
Subject to the provisions of this article, any public utility may issue bonds, or other interest bearing securities maturing at periods of more than 12 months after the date thereof, and may issue one or more classes of preferred stock which may have attached thereto warrants entitling the holder to subscribe for shares of common stock in such amounts, at such future dates, at such prices and on such terms and conditions as may be specified in the warrants. Such bonds, or other interest bearing obligations and such preferred stock also may be issued with provision therein that they may be converted into shares of common stock in such amounts, at such future dates, at such prices, and on such terms and conditions as may be specified therein.
Pursuant to this part the commission may, upon an application for an order to issue stocks, bonds, debentures, notes, or other securities or to deliver other consideration in exchange for one or more bona fide outstanding stocks, bonds, debentures, notes, or other securities, claims or property interests, or partly in such exchange and partly for cash, approve the terms and conditions of such issuance and exchange or such delivery and exchange and the fairness of such terms and conditions, after a hearing upon the fairness thereof. All persons to whom it is proposed to issue stocks, bonds, debentures, notes or other securities or to deliver such other consideration in such exchange may appear at such hearing.
No public utility shall, without the consent of the commission, apply any part of the issue of any stock or stock certificate or other evidence of interest or ownership, or bond, note, or other evidence of indebtedness, or any proceeds thereof, to any purpose not specified in the commission’s order, or to any purpose specified in the order in excess of the amount authorized for such purpose, or issue or dispose thereof on any terms less favorable than those specified in the order, or a modification thereof.
A public utility may issue notes, for proper purposes and not in violation of any provision of law, payable at periods of not more than 12 months after the date of issuance of the notes without the consent of the commission.
Notwithstanding the provisions of subdivision (b), no public utility as defined in Section 201(e) of the Federal Power Act (49 Stat. 847, 16 U.S.C. 824) shall, without the consent of the commission, issue notes payable at periods of not more than 12 months after the date of issuance of the notes if such notes and all other notes payable at periods of not more than 12 months after the date of issuance of such notes on which such public utility is primarily or secondarily liable would exceed in aggregate amount 5 percent of the par value of the other securities then outstanding. In the case of securities having no par value, the par value for the purposes of this subsection shall be the fair market value as of the date of issue.
No note payable at a period of not more than 12 months after the date of issuance of such note shall, in whole or in part, be refunded by any issue of stocks or stock certificates or other evidence of interest or ownership, or of bonds, notes of any term or character, or any other evidence of indebtedness, without the consent of the commission.
The commission may require public utilities to account for the disposition of the proceeds of all sales of stocks and stock certificates or other evidence of interest or ownership, and bonds, notes, and other evidences of indebtedness, in such form and detail as it deems advisable, and may establish such rules as it deems reasonable and necessary to insure the disposition of such proceeds for the purposes specified in its order.
All stock and every stock certificate or other evidence of interest or ownership, and every bond, note, or other evidence of indebtedness, of a public utility, issued without an order of the commission authorizing the issue thereof then in effect or not conforming in its provisions to any of the provisions which it is required by the order of authorization to contain, is void. No failure in any other respect to comply with the terms or conditions of the order of authorization of the commission shall render void any stock or stock certificate or other evidence of interest or ownership, or any bond, note, or other evidence of indebtedness, except as to a corporation or person taking it otherwise than in good faith and for value and without actual notice.
Every public utility which, directly or indirectly issues or causes to be issued, any stock or stock certificate or other evidence of interest or ownership, or bond, note, or other evidence of indebtedness, in nonconformity with the order of the commission authorizing the issue, or contrary to the provisions of this part, or of the Constitution of this State, or which applies any part of the proceeds from the sale thereof, to any purpose other than the purpose or purposes specified in the commission’s order or in an amount in excess of the amount authorized for a specified purpose in the order, is subject to a penalty of not less than five hundred dollars ($500), nor more than twenty thousand dollars ($20,000) for each offense.
Every officer, agent, or employee of a public utility, and every other person is guilty of a felony who does any of the following acts:
Knowingly authorizes, directs, aids in, issues, or executes, or causes to be issued or executed, any stock or stock certificate or other evidence of interest or ownership, or bond, note, or other evidence of indebtedness, in nonconformity with the order of the commission authorizing the issue, or contrary to the provisions of this part or of the Constitution of this State.
Knowingly makes any false statement or representation in any proceeding before the commission or with knowledge of its falsity files or causes to be filed with the commission any false statement or representation which tends in any way to influence the commission to make an order authorizing the issue of any stock or stock certificate or other evidence of interest or ownership, or any bond, note, or other evidence of indebtedness, or which results in procuring from the commission the making of any such order.
With knowledge that any false statement or representation was made to the commission, in any proceeding, tending in any way to influence the commission to make such order, issues or executes or negotiates, or causes to be issued, executed, or negotiated any such stock or stock certificate or other evidence of interest or ownership, or bond, note, or other evidence of indebtedness.
Directly or indirectly, knowingly applies, or causes or assists to be applied any part of the proceeds from the sale of any stock or stock certificate or other evidence of interest or ownership, or bond, note, or other evidence of indebtedness, to any purpose not specified in the commission’s order, or to any purpose specified in the commission’s order in excess of the amount authorized for such purpose.
With knowledge that any stock or stock certificate or other evidence of interest or ownership, or bond, note, or other evidence of indebtedness, has been issued or executed in violation of any of the provisions of this part, negotiates, or causes the same to be negotiated.
No provision of this part, and no act done or performed under or in connection therewith, shall obligate the State to pay or guarantee, in any manner whatsoever, any stock or stock certificate or other evidence of interest or ownership, or bond, note, or other evidence of indebtedness, authorized, issued, or executed under the provisions of this part.
This article shall not apply to any person or corporation which transacts no business subject to regulation under this part, except performing services or delivering commodities for or to public utilities or municipal or other public corporations primarily for resale or use in serving the public or any portion thereof. This article shall apply to any public utility if the commission finds, in a proceeding to which the public utility is or may become a party, that the application of this article is required by the public interest.
Except for Section 828, a telephone corporation that is not regulated under a rate-of-return regulatory structure is exempt from this article. This subdivision does not exempt a telephone corporation that is also an electrical corporation or a gas corporation, unless the commission determines the telephone corporation is exempt pursuant to subdivision (c). As used in this subdivision, a “rate-of-return regulatory structure” means a system under which the rates and charges of the telephone corporation are limited by a maximum permissible price that may be charged for a specific service. Telephone corporations regulated by a framework under which they may exercise pricing flexibility for all or most of the services offered are not regulated under a rate-of-return regulatory structure.
Notwithstanding paragraph (1), the commission may impose any requirement of this article on a telephone corporation if the commission finds, in a proceeding in which the telephone corporation is or may become a party, that the application of any provision of this article is required by the public interest.
The commission may from time to time by order or rule, and subject to such terms and conditions as may be prescribed therein, exempt any public utility or class of public utility from this article if it finds that the application thereof to such public utility or class of public utility is not necessary in the public interest.
No public utility shall assume any obligation or liability as guarantor, endorser, surety, or otherwise in respect of the securities of any other person, firm, or corporation, when such securities are payable at periods of more than 12 months after the date thereof, without having first secured from the commission an order authorizing it so to do. Every such assumption made other than in accordance with the order of the commission authorizing it is void.
ARTICLE 5.5. Financing of Transition Costs [840. - 847.]
For the purposes of this article, the following terms shall have the following meanings:
“Bank” means the California Infrastructure and Economic Development Bank.
“Financing entity” means the bank, any special purpose trust, as defined in Section 63010 of the Government Code, that is authorized by the bank to issue rate reduction bonds or acquire transition property, or any other entity authorized by the bank to issue rate reduction bonds or acquire transition property, or both. The bank may authorize an entity other than a special purpose trust, as defined in Section 63010 of the Government Code, to issue rate reduction bonds only if all of the following conditions are met:
The bank by resolution has determined that allowing another entity to issue rate reduction bonds would produce greater overall ratepayer savings, taking into account all relevant considerations including, but not limited to, the exclusion of interest on rate reduction bonds issued by the bank from investors’ gross income for California or federal income tax purposes, or both, earnings on funds collected and held by the electrical corporation prior to deposit in a fund or account for the benefit of holders of rate reduction bonds, and all costs of issuance and other transaction costs.
The bank submits to the Joint Legislative Budget Committee a certified copy of the bank’s resolution, together with a report setting forth the basis for the bank’s determination that a financing entity other than the bank or a special purpose trust will produce greater ratepayer savings and at least 30 days have elapsed from the date of submission.
“Financing order” shall mean an order of the commission adopted in accordance with this article, which shall include, without limitation, a procedure to require the expeditious approval by the commission of periodic adjustments to fixed transition amounts included therein to ensure recovery of all transition costs and the costs of capital associated with the proposed provision, recovery, financing, or refinancing thereof, including the costs of issuing, servicing, and retiring the rate reduction bonds contemplated by the financing order. These adjustments shall not impose fixed transition amounts upon classes of customers who were not subject to the fixed transition amounts in the pertinent financing order.
“Fixed transition amounts” means those nonbypassable rates and other charges, including, but not limited to, distribution, connection, disconnection, and termination rates and charges, that are authorized by the commission in a financing order to recover (1) transition costs, and (2) the costs of providing, recovering, financing, or refinancing the transition costs through a plan approved by the commission in the financing order, including the costs of issuing, servicing, and retiring rate reduction bonds. If requested by the electrical corporation in its application for a financing order, fixed transition amounts shall include nonbypassable rates and other charges to recover federal and state taxes whose recovery period is modified by the transactions approved in the financing order.
“Rate reduction bonds” means bonds, notes, certificates of participation or beneficial interest, or other evidences of indebtedness or ownership, issued pursuant to an executed indenture or other agreement of a financing entity, the proceeds of which are used, directly or indirectly, to provide, recover, finance, or refinance transition costs, and that are directly or indirectly secured by, or payable from, transition property.
“Transition costs” means the costs, and categories of costs, of an electrical corporation for generation-related assets and obligations, consisting of generation facilities, generation-related regulatory assets, nuclear settlements, and power purchase contracts, including, but not limited to, voluntary restructuring, renegotiations, or terminations thereof approved by the commission, that were being collected in commission-approved rates on December 20, 1995, and that may become uneconomic as a result of a competitive generation market in that those costs may not be recoverable in market prices in a competitive market, and appropriate costs incurred after December 20, 1995, for capital additions to generating facilities existing as of December 20, 1995, that the commission determines are reasonable and should be recovered, provided that these costs are necessary to maintain the facilities through December 31, 2001. Transition costs shall also include the costs of refinancing or retiring of debt or equity capital of the electrical corporation, and associated federal and state tax liabilities.
“Transition property” means the property right created pursuant to this article including, without limitation, the right, title, and interest of an electrical corporation or its transferee:
In and to the tariff established pursuant to a financing order, as adjusted from time to time in accordance with subdivision (c) of Section 841 and the financing order.
To be paid the amount that is determined in a financing order to be the amount that the electrical corporation or its transferee is lawfully entitled to receive pursuant to the provision of this article and the proceeds thereof, and in and to all revenues, collections, claims, payments, money, or proceeds of or arising from the tariff or constituting fixed transition amounts that are the subject of a financing order including those nonbypassable rates and other charges referred to in subdivision (d).
In and to all rights to obtain adjustments to the tariff pursuant to the terms of subdivision (c) of Section 841 and the financing order.
“Transition property” shall constitute a current property right notwithstanding the fact that the value of the property right will depend on consumers using electricity or, in those instances where consumers are customers of a particular electrical corporation, the electrical corporation performing certain services.
An electrical corporation shall, by June 1, 1997, and may from time to time thereafter apply to the commission for a determination that certain transition costs may be recovered through fixed transition amounts, which would therefore constitute transition property under this article. An electrical corporation may request this determination by the commission in separate proceedings or in an order instituting investigation or order instituting rulemaking, or both. The electrical corporation shall in its application specify that the residential and small commercial customers as defined in subdivision (h) of Section 331 would benefit from reduced rates through the issuance of rate reduction bonds. The commission shall designate fixed transition amounts as recoverable in one or more financing orders if the commission determines, as part of its findings in connection with the financing order, that the designation of the fixed transition amounts, and issuance of rate reduction bonds in connection with some or all of the fixed transition amounts would reduce rates that residential and small commercial customers would have paid if the financing order were not adopted. These customers shall continue to pay fixed transition amounts after December 31, 2001, until the bonds are paid in full by the financing entity. No electrical corporation shall be found to have acted imprudently or unreasonably for failing to amend a power purchase contract where the amendment would modify or waive an existing requirement that the seller be a qualifying facility pursuant to federal law.
The commission may issue financing orders in accordance with this article to facilitate the provision, recovery, financing, or refinancing of transition costs. A financing order may be adopted only upon the application of an electrical corporation and shall become effective in accordance with its terms only after the electrical corporation files with the commission the electrical corporation’s written consent to all terms and conditions of the financing order. A financing order may specify how amounts collected from a customer shall be allocated between fixed transition amounts and other charges.
Notwithstanding Section 455.5, Section 1708, or any other provision of law, except as otherwise provided in this subdivision with respect to transition property that has been made the basis for the issuance of rate reduction bonds, the financing orders and the fixed transition amounts shall be irrevocable and the commission shall not have authority either by rescinding, altering, or amending the financing order or otherwise, to revalue or revise for ratemaking purposes the transition costs, or the costs of providing, recovering, financing, or refinancing the transition costs, determine that the fixed transition amounts or rates are unjust or unreasonable, or in any way reduce or impair the value of transition property either directly or indirectly by taking fixed transition amounts into account when setting other rates for the electrical corporation; nor shall the amount of revenues arising with respect thereto be subject to reduction, impairment, postponement, or termination. Except as otherwise provided in this subdivision, the State of California does hereby pledge and agree with the owners of transition property and holders of rate reduction bonds that the state shall neither limit nor alter the fixed transition amounts, transition property, financing orders, and all rights thereunder until the obligations, together with the interest thereon, are fully met and discharged, provided nothing contained in this section shall preclude the limitation or alteration if and when adequate provision shall be made by law for the protection of the owners and holders. The bank as agent for the state is authorized to include this pledge and undertaking for the state in these obligations. Notwithstanding any other provision of this section, the commission shall approve the adjustments to the fixed transition amounts as may be necessary to ensure timely recovery of all transition costs that are the subject of the pertinent financing order, and the costs of capital associated with the provision, recovery, financing, or refinancing thereof, including the costs of issuing, servicing, and retiring the rate reduction bonds contemplated by the financing order. The adjustments shall not impose fixed transition amounts upon classes of customers who were not subject to the fixed transition amounts in the pertinent financing order.
Financing orders issued under this article do not constitute a debt or liability of the state or of any political subdivision thereof, other than the financing entity, and do not constitute a pledge of the full faith and credit of the state or any of its political subdivisions, other than the financing entity, but are payable solely from the funds provided therefor under this article and shall be consistent with Sections 1 and 18 of Article XVI of the California Constitution. This subdivision shall in no way preclude bond guarantees or enhancements pursuant to this article. All the bonds shall contain on the face thereof a statement to the following effect:
“Neither the full faith and credit nor the taxing power of the State of California is pledged to the payment of the principal of, or interest on, this bond.”
The issuance of bonds under this article shall not directly, indirectly, or contingently obligate the state or any political subdivision thereof to levy or to pledge any form of taxation therefor or to make any appropriation for their payment. Nothing in this section shall prevent, or be construed to prevent, the financing entity from pledging the full faith and credit of the infrastructure bank fund to the payment of bonds or issuance of bonds authorized pursuant to this article.
The commission shall establish procedures for the expeditious processing of applications for financing orders, including the approval or disapproval thereof within 120 days of the electrical corporation’s making application therefor. The commission shall provide in any financing order for a procedure for the expeditious approval by the commission of periodic adjustments to the fixed transition amounts that are the subject of the pertinent financing order, as required by subdivision (c). The procedure shall require the commission to determine whether the adjustments are required on each anniversary of the issuance of the financing order, and at the additional intervals as may be provided for in the financing order, and for the adjustments, if required, to be approved within 90 days of each anniversary of the issuance of the financing order, or of each additional interval provided for in the financing order.
Fixed transition amounts shall constitute transition property when, and to the extent that, a financing order authorizing the fixed transition amounts has become effective in accordance with this article, and the transition property shall thereafter continuously exist as property for all purposes with all of the rights and privileges of this article for the period and to the extent provided in the financing order, but in any event until the rate reduction bonds are paid in full, including all principal, interest, premium, costs, and arrearages thereon.
Any surplus fixed transition amounts in excess of the amounts necessary to pay principal, premium, if any, interest and expenses of the issuance of the rate reduction bonds shall be remitted to the financing entity and may be used to benefit residential and small commercial customers if this would not result in a recharacterization of the tax, accounting, and other intended characteristics of the financing, including, but not limited to, the following:
Avoiding the recognition of debt on the electrical corporation’s balance sheet for financial accounting and regulatory purposes.
Treating the rate reduction bonds as debt of the electrical corporation or its affiliates for federal income tax purposes.
Treating the transfer of the transition property by the electrical corporation as a true sale for bankruptcy purposes.
Avoiding any adverse impact of the financing on the electrical corporation’s credit rating.
Financing entities may issue rate reduction bonds upon approval by the commission in the pertinent financing orders. Rate reduction bonds shall be nonrecourse to the credit or any assets of the electrical corporation, other than the transition property as specified in the pertinent financing order.
Electrical corporations may sell and assign all or portions of their interest in transition property to an affiliate. Electrical corporations or their affiliates may sell or assign their interests to one or more financing entities that make that property the basis for issuance of rate reduction bonds to the extent approved in the pertinent financing orders. Electrical corporations, their affiliates, or financing entities may pledge transition property as collateral, directly or indirectly, for rate reduction bonds to the extent approved in the pertinent financing orders providing for a security interest in the transition property, in the manner as set forth in Section 843. In addition transition property may be sold or assigned by (1) the financing entity or a trustee for the holders of rate reduction bonds in connection with the exercise of remedies upon a default, or (2) any person acquiring the transition property after a sale or assignment pursuant to this subdivision.
To the extent that any interest in transition property is so sold or assigned, or is so pledged as collateral, the commission shall authorize the electrical corporation to contract with the financing entity that it will continue to operate its system to provide service to its customers, will collect amounts in respect of the fixed transition amounts for the benefit and account of the financing entity, and will account for and remit these amounts to or for the account of the financing entity. Contracting with the financing entity in accordance with that authorization shall not impair or negate the characterization of the sale, assignment, or pledge as an absolute transfer, a true sale, or security interest, as applicable.
Notwithstanding Section 1708 or any other provision of law, any requirement under this article or a financing order that the commission take action with respect to the subject matter of a financing order shall be binding upon the commission, as it may be constituted from time to time, and any successor agency exercising functions similar to the commission and the commission shall have no authority to rescind, alter, or amend that requirement in a financing order. The approval by the commission in a financing order of the issuance by an electrical corporation or a financing entity of rate reduction bonds shall include the approvals, if any, as may be required by Article 5 (commencing with Section 816) and Section 701.5. Nothing in Section 701.5 shall be construed to prohibit the issuance of rate reduction bonds upon the terms and conditions as may be approved by the commission in a financing order. Section 851 shall not be applicable to the transfer or pledge of transition property, the issuance of rate reduction bonds, or related transactions approved in a financing order.
A security interest in transition property is valid, is enforceable against the pledgor and third parties, subject to the rights of any third parties holding security interests in the transition property perfected in the manner described in this section, and attaches when all of the following have taken place:
The commission has issued the financing order authorizing the fixed transition amounts included in the transition property.
Value has been given by the pledgees of the transition property.
The pledgor has signed a security agreement covering the transition property.
A valid and enforceable security interest in transition property is perfected when it has attached and when a financing statement has been filed in accordance with Chapter 5 (commencing with Section 9501) of Division 9 of the Commercial Code naming the pledgor of the transition property as “debtor” and identifying the transition property. Any description of the transition property shall be sufficient if it refers to the financing order creating the transition property. A copy of the financing statement shall be filed with the commission by the electrical corporation that is the pledgor or transferor of the transition property, and the commission may require the electrical corporation to make other filings with respect to the security interest in accordance with procedures it may establish, provided that the filings shall not affect the perfection of the security interest.
A perfected security interest in transition property is a continuously perfected security interest in all revenues and proceeds arising with respect thereto, whether or not the revenues or proceeds have accrued. Conflicting security interests shall rank according to priority in time of perfection. Transition property shall constitute property for all purposes, including for contracts securing rate reduction bonds, whether or not the revenues and proceeds arising with respect thereto have accrued.
Subject to the terms of the security agreement covering the transition property and the rights of any third parties holding security interests in the transition property perfected in the manner described in this section, the validity and relative priority of a security interest created under this section is not defeated or adversely affected by the commingling of revenues arising with respect to the transition property with other funds of the electrical corporation that is the pledgor or transferor of the transition property, or by any security interest in a deposit account of that electrical corporation perfected under Division 9 (commencing with Section 9101) of the Commercial Code into which the revenues are deposited. Subject to the terms of the security agreement, upon compliance with the requirements of Section 9311 of the Commercial Code, the pledgees of the transition property shall have a perfected security interest in all cash and deposit accounts of the electrical corporation in which revenues arising with respect to the transition property have been commingled with other funds, but the perfected security interest shall be limited to an amount not greater than the amount of the revenues with respect to the transition property received by the electrical corporation within 12 months before (1) any default under the security agreement or (2) the institution of insolvency proceedings by or against the electrical corporation, less payments from the revenues to the pledgees during that 12-month period.
If an event of default occurs under the security agreement covering the transition property, the pledgees of the transition property, subject to the terms of the security agreement, shall have all rights and remedies of a secured party upon default under Division 9 (commencing with Section 9101) of the Commercial Code, and shall be entitled to foreclose or otherwise enforce their security interest in the transition property, subject to the rights of any third parties holding prior security interests in the transition property perfected in the manner provided in this section. In addition, the commission may require, in the financing order creating the transition property, that, in the event of default by the electrical corporation in payment of revenues arising with respect to the transition property, the commission and any successor thereto, upon the application by the pledgees or transferees, including transferees under Section 844, of the transition property, and without limiting any other remedies available to the pledgees or transferees by reason of the default, shall order the sequestration and payment to the pledgees or transferees of revenues arising with respect to the transition property. Any order shall remain in full force and effect notwithstanding any bankruptcy, reorganization, or other insolvency proceedings with respect to the debtor, pledgor, or transferor of the transition property. Any surplus in excess of amounts necessary to pay principal, premium, if any, interest, costs, and arrearages on the rate reduction bonds, and other costs arising under the security agreement, shall be remitted to the debtor or to the pledgor or transferor.
Section 5451 of the Government Code shall not apply to any pledge of transition property by a financing entity. Sections 9204 and 9205 of the Commercial Code shall apply to a pledge of transition property by an electrical corporation, an affiliate of an electrical corporation, or a financing entity.
This section sets forth the terms by which a consensual security interest can be created and perfected in the transition property. Unless otherwise ordered by the commission with respect to any series of rate reduction bonds on or prior to the issuance of the series, there shall exist a statutory lien as provided in this subdivision. Upon the effective date of the financing order, there shall exist a first priority lien on all transition property then existing or thereafter arising pursuant to the terms of the financing order. This lien shall arise by operation of this section automatically without any action on the part of the electrical corporation, any affiliate thereof, the financing entity, or any other person. This lien shall secure all obligations, then existing or subsequently arising, to the holders of the rate reduction bonds issued pursuant to the financing order, the trustee or representative for the holders, and any other entity specified in the financing order. The persons for whose benefit this lien is established shall, upon the occurrence of any defaults specified in the financing order, have all rights and remedies of a secured party upon default under Division 9 (commencing with Section 9101) of the Commercial Code, and shall be entitled to foreclose or otherwise enforce this statutory lien in the transition property. This lien shall attach to the transition property regardless of who shall own, or shall subsequently be determined to own, the transition property including any electrical corporation, any affiliate thereof, the financing entity, or any other person. This lien shall be valid, perfected, and enforceable against the owner of the transition property and all third parties upon the effectiveness of the financing order without any further public notice; provided, however, that any person may, but shall not be required to, file a financing statement in accordance with subdivision (b). Financing statements so filed may be “protective filings” and shall not be evidence of the ownership of the transition property.
A perfected statutory lien in transition property is a continuously perfected lien in all revenues and proceeds arising with respect thereto, whether or not the revenues or proceeds have accrued. Conflicting liens shall rank according to priority in time of perfection. Transition property shall constitute property for all purposes, including for contracts securing rate reduction bonds, whether or not the revenues and proceeds arising with respect thereto have accrued.
In addition, the commission may require, in the financing order creating the transition property, that, in the event of default by the electrical corporation in payment of revenues arising with respect to transition property, the commission and any successor thereto, upon the application by the beneficiaries of the statutory lien, and without limiting any other remedies available to the beneficiaries by reason of the default, shall order the sequestration and payment to the beneficiaries of revenues arising with respect to the transition property. Any order shall remain in full force and effect notwithstanding any bankruptcy, reorganization, or other insolvency proceedings with respect to the debtor, pledgor, or transferor of the transition property. Any surplus in excess of amounts necessary to pay principal, premium, if any, interest, costs, and arrearages on the rate reduction bonds, and other costs arising in connection with the documents governing the rate reduction bonds, shall be remitted to the debtor or to the pledgor or transferor.
A transfer of transition property by an electrical corporation to an affiliate or to a financing entity, or by an affiliate of an electrical corporation or a financing entity to another financing entity, which the parties have in the governing documentation expressly stated to be a sale or other absolute transfer, in a transaction approved in a financing order, shall be treated as an absolute transfer of all of the transferor’s right, title, and interest (as in a true sale), and not as a pledge or other financing, of the transition property, other than for federal and state income and franchise tax purposes. Granting to holders of rate reduction bonds a preferred right to revenues of the electrical corporation, or the provision by the company of other credit enhancement with respect to rate reduction bonds, shall not impair or negate the characterization of any transfer as a true sale, other than for federal and state income and franchise tax purposes.
A transfer of transition property shall be deemed perfected as against third persons when both of the following have taken place:
The commission has issued the financing order authorizing the fixed transition amounts included in the transition property.
An assignment of the transition property in writing has been executed and delivered to the transferee.
As between bona fide assignees of the same right for value without notice, the assignee first filing a financing statement in accordance with Chapter 5 (commencing with Section 9501) of Division 9 of the Commercial Code naming the assignor of the transition property as debtor and identifying the transition property has priority. Any description of the transition property shall be sufficient if it refers to the financing order creating the transition property. A copy of the financing statement shall be filed by the assignee with the commission, and the commission may require the assignor or the assignee to make other filings with respect to the transfer in accordance with procedures it may establish, but these filings shall not affect the perfection of the transfer.
Any successor to the electrical corporation, whether pursuant to any bankruptcy, reorganization, or other insolvency proceeding, or pursuant to any merger, sale, or transfer, by operation of law, or otherwise, shall perform and satisfy all obligations of the electrical corporation pursuant to this article in the same manner and to the same extent as the electrical corporation, including, but not limited to, collecting and paying to the holders of rate reduction bonds or their representatives or the applicable financing entity revenues arising with respect to the transition property sold to the applicable financing entity or pledged to secure rate reduction bonds.
The authority of the commission to issue financing orders pursuant to Section 841 shall expire on June 30, 2022. The expiration of the authority shall have no effect upon financing orders adopted by the commission pursuant to this article or any transition property arising therefrom, or upon the charges authorized to be levied thereunder, or the rights, interests, and obligations of the electrical corporation or a financing entity or holders of transition bonds pursuant to the financing order, or the authority of the commission to monitor, supervise, or take further action with respect to the order in accordance with the terms of this article and of the order.
“Excess rate reduction bond proceeds,” as used in this section, means proceeds from the sale of rate reduction bonds authorized by commission financing orders issued pursuant to this article that are subsequently determined by the commission to be in excess of the amounts necessary to provide the 10-percent rate reduction during the period when the rates were frozen pursuant to subdivision (a) of Section 368.
Regulations adopted to implement this article shall not be subject to the Administrative Procedure Act (Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code).
ARTICLE 5.6. Financing Utility Recovery [848. - 848.8.]
For the purposes of this article, the following terms shall have the following meanings:
“Consumer” means any individual, governmental body, trust, business entity or nonprofit organization which consumes electricity that has been transmitted or distributed by means of electric transmission or distribution facilities, whether those electric transmission or distribution facilities are owned by the consumer, the recovery corporation, or any other party.
“Financing entity” means the recovery corporation or any subsidiary or affiliate of the recovery corporation that is authorized by the commission to issue recovery bonds or acquire recovery property, or both.
“Financing order” means an order of the commission adopted in accordance with this article, which shall include, without limitation, a procedure to require the expeditious approval by the commission of periodic adjustments to fixed recovery amounts and to any associated fixed recovery tax amounts included in that financing order to ensure recovery of all recovery costs and the costs associated with the proposed recovery, financing, or refinancing thereof, including the costs of servicing and retiring the recovery bonds contemplated by the financing order.
“Fixed recovery amounts” means those nonbypassable rates and other charges, including, but not limited to, distribution, connection, disconnection, and termination rates and charges, that are authorized by the commission in a financing order to recover (1) recovery costs specified in the financing order, and (2) the costs of recovering, financing, or refinancing those recovery costs through a plan approved by the commission in the financing order, including the costs of servicing and retiring recovery bonds.
“Fixed recovery tax amounts” means those nonbypassable rates and other charges, including, but not limited to, distribution, connection, disconnection, and termination rates and charges, that are needed to recover federal and State of California income and franchise taxes associated with fixed recovery amounts authorized by the commission in the financing order and that are not financed from proceeds of recovery bonds.
“Recovery bonds” means bonds, notes, certificates of participation or beneficial interest, or other evidences of indebtedness or ownership, issued pursuant to an executed indenture or other agreement of a financing entity, the proceeds of which are used, directly or indirectly, to recover, finance, or refinance recovery costs, and that are directly or indirectly secured by, or payable from, recovery property.
“Recovery corporation” means Pacific Gas and Electric Company, the electrical corporation described in the commission’s Decision No. 03-12-035.
“Recovery costs” means (1) the unamortized balance of the regulatory asset arising and existing pursuant to the commission’s Decision No. 03-12-035, (2) federal and State of California income and franchise taxes associated with recovery of the unamortized balance of that regulatory asset, (3) costs of issuing recovery bonds, and (4) professional fees, consultant fees, redemption premiums, tender premiums and other costs incurred by the recovery corporation in using proceeds of recovery bonds to acquire outstanding securities of the recovery corporation.
“Recovery property” means the property right created pursuant to this article, including, without limitation, the right, title, and interest of the recovery corporation or its transferee:
In and to the tariff established pursuant to a financing order, as adjusted from time to time in accordance with Section 848.1 and the financing order.
To be paid the amount that is determined in a financing order to be the amount that the recovery corporation or its transferee is lawfully entitled to receive pursuant to the provisions of this article and the proceeds thereof, and in and to all revenues, collections, claims, payments, money, or proceeds of or arising from the tariff or constituting fixed recovery amounts that are the subject of a financing order including those nonbypassable rates and other charges referred to in subdivision (d).
In and to all rights to obtain adjustments to the tariff relating to fixed recovery amounts pursuant to the terms of Section 848.1 and the financing order.
“Recovery property” shall not include the right to be paid fixed recovery tax amounts.
“Recovery property” shall constitute a current property right notwithstanding the fact that the value of the property right will depend on consumers using electricity or, in those instances where consumers are customers of the recovery corporation, the recovery corporation performing certain services.
“Service territory” means the geographical area that the recovery corporation provided with electric distribution service as of December 19, 2003.
No later than 120 days after the effective date of this article, and from time to time thereafter, the recovery corporation shall apply to the commission for a determination that some or all of the recovery corporation’s recovery costs may be recovered through fixed recovery amounts, which would be recovery property under this article, and that any portion of the recovery corporation’s federal and State of California income and franchise taxes associated with those fixed recovery amounts and not financed from proceeds of recovery bonds be recovered through fixed recovery tax amounts. The recovery corporation may request this determination by the commission in a separate proceeding or in an existing proceeding, or both. The recovery corporation shall in its application specify that consumers within its service territory would benefit from reduced rates on a present value basis through the issuance of recovery bonds. The commission shall designate fixed recovery amounts and any associated fixed recovery tax amounts as recoverable in one or more financing orders if the commission determines, as part of its findings in connection with the financing order, that the designation of the fixed recovery amounts and any associated fixed recovery tax amounts, and the issuance of recovery bonds in connection with fixed recovery amounts, would reduce the rates on a present value basis that consumers within the recovery corporation’s service territory would pay if the financing order were not adopted. Fixed recovery amounts and any associated fixed recovery tax amounts shall only be imposed on existing and future consumers in the service territory. Consumers within the service territory shall continue to pay fixed recovery amounts and any associated fixed tax recovery amounts until the recovery bonds are paid in full by the financing entity. Once the recovery bonds have been paid in full, the payment by consumers of fixed recovery amounts and fixed recovery tax amounts shall terminate.
The commission shall establish an effective mechanism that ensures recovery of recovery costs through fixed recovery amounts and any associated fixed recovery tax amounts from existing and future consumers in the service territory, provided that the costs shall not be recoverable from any of the following:
New load or incremental load of an existing consumer of the recovery corporation where the load is being met through a direct transaction and the transaction does not require the use of transmission or distribution facilities owned by the recovery corporation.
Customer Generation departing load that is exempt from Department of Water Resources power charges pursuant to the commission’s Decision No. 03-04-030, as modified by Decision No. 03-04-041, and as clarified and affirmed by Decision No. 03-05-039, except that the load shall pay the costs as a component of and in proportion to any purchase of electricity delivered by the recovery corporation under standby or other service made following its departure.
The Department of Water Resources, with respect to the pumping, generation, and transmission facilities and operations of the State Water Resources Development System, except to the extent that system facilities receive electric service from the recovery corporation on or after December 19, 2003, under a commission approved tariff.
Retail electric load, continuously served by a local publicly owned electric utility from January 1, 2000, through the effective date of the act adding this section.
Load that thereafter comes to take electric service from a city where all the following conditions are met:
The new load is from locations that never received electric service from the recovery corporation.
The city owns and operates the local publicly owned electric utility.
The local publicly owned electric utility served more than 95 percent of the customers receiving electric service residing within the city limits prior to December 19, 2003.
The city annexed the territory in which the load is located on or after December 19, 2003.
Following annexation, the city provides all municipal services to the annexed territory that the city provides to other territory within the city limits, including electric service.
The total load exempt from paying fixed recovery amounts and associated fixed recovery tax amounts pursuant to subparagraphs (A) through (D), inclusive, does not exceed 50 megawatts, as determined by the commission, and any load above the 50 megawatt exemption amount shall be responsible for paying recovery amounts and associated fixed recovery tax amounts, except as provided in subdivision (c).
Except as provided in paragraphs (4) and (5) of subdivision (b), the commission shall determine the extent to which fixed recovery amounts and any associated fixed recovery tax amounts are recoverable from new municipal load, consistent with the commission’s determination in the limited rehearing granted in Decision 03-08-076. The determination of the commission shall be made on the earlier of the date it adopts a financing order or December 31, 2004.
Except as provided in paragraphs (4) and (5) of subdivision (b) and in subdivision (c), the obligation to pay fixed recovery amounts and any associated fixed recovery tax amounts cannot be avoided by the formation of a local publicly owned electric utility on or after December 19, 2003, or by annexation of any portion of the service territory of the recovery corporation by an existing local publicly owned electric utility.
Recovery bonds authorized by the commission’s financing orders may be issued in one or more series on or before December 31, 2006.
The commission may issue financing orders in accordance with this article to facilitate the recovery, financing, or refinancing of recovery costs. A financing order may be adopted only upon the application of the recovery corporation and shall become effective in accordance with its terms only after the recovery corporation files with the commission the recovery corporation’s written consent to all terms and conditions of the financing order. A financing order may specify how amounts collected from a consumer shall be allocated between fixed recovery amounts, any associated fixed recovery tax amounts, and other charges.
Notwithstanding Section 455.5 or 1708, or any other provision of law, except as otherwise provided in Section 848.7 or in this subdivision with respect to recovery property that has been made the basis for the issuance of recovery bonds and with respect to any associated fixed recovery tax amounts, the financing order, the fixed recovery amounts and any associated fixed recovery tax amounts shall be irrevocable, and the commission shall not have authority either by rescinding, altering, or amending the financing order or otherwise, to revalue or revise for ratemaking purposes, the recovery costs or the costs of recovering, financing, or refinancing the recovery costs, determine that the fixed recovery amounts, any associated fixed recovery tax amounts or rates are unjust or unreasonable, or in any way reduce or impair the value of recovery property or of the right to receive any associated fixed recovery tax amounts either directly or indirectly by taking fixed recovery amounts or any associated fixed recovery tax amounts into account when setting other rates for the recovery corporation or when setting charges for the Department of Water Resources; nor shall the amount of revenues arising with respect thereto be subject to reduction, impairment, postponement, or termination. Except as otherwise provided in this subdivision, the State of California does hereby pledge and agree with the recovery corporation, owners of recovery property, and holders of recovery bonds that the state shall neither limit nor alter the fixed recovery amounts, any associated fixed recovery tax amounts, recovery property, financing orders, or any rights thereunder until the recovery bonds, together with the interest thereon, are fully paid and discharged, and any associated fixed recovery tax amounts have been satisfied or, in the alternative, have been refinanced through an additional issue of recovery bonds; provided nothing contained in this section shall preclude the limitation or alteration if and when adequate provision shall be made by law for the protection of the recovery corporation, owners, and holders. The financing entity is authorized to include this pledge and undertaking for the state in these recovery bonds. Notwithstanding any other provision of this section, the commission shall approve adjustments to the fixed recovery amounts and any associated fixed recovery tax amounts as may be necessary to ensure timely recovery of all recovery costs that are the subject of the pertinent financing order, and the costs of capital associated with the recovery, financing, or refinancing thereof, including servicing and retiring the recovery bonds contemplated by the financing order. When setting other rates for the recovery corporation, nothing in this subdivision shall prevent the commission from taking into account either of the following:
Any collection of fixed recovery amounts in excess of amounts actually required to pay recovery costs financed or refinanced by recovery bonds.
Any collection of fixed recovery tax amounts in excess of amounts actually required to pay federal and State of California income and franchise taxes associated with fixed recovery amounts; provided that this would not result in a recharacterization of the tax, accounting, and other intended characteristics of the financing, including, but not limited to, either of the following:
Treating the recovery bonds as debt of the recovery corporation or its affiliates for federal income tax purposes.
Treating the transfer of the recovery property by the recovery corporation as a true sale for bankruptcy purposes.
Financing orders issued under this article do not constitute a debt or liability of the state or of any political subdivision thereof, and do not constitute a pledge of the full faith and credit of the state or any of its political subdivisions, but are payable solely from the funds provided therefor under this article and shall be consistent with Sections 1 and 18 of Article XVI of the California Constitution. This subdivision shall in no way preclude bond guarantees or enhancements pursuant to this article. All recovery bonds shall contain on the face thereof a statement to the following effect: “Neither the full faith and credit nor the taxing power of the State of California is pledged to the payment of the principal of, or interest on, this bond.”
The issuance of recovery bonds under this article shall not directly, indirectly, or contingently obligate the state or any political subdivision thereof to levy or to pledge any form of taxation therefor or to make any appropriation for their payment.
The commission shall establish procedures for the expeditious processing of applications for financing orders, including the approval or disapproval thereof within 120 days of the recovery corporation making application therefor. The commission shall provide in any financing order for a procedure for the expeditious approval by the commission of periodic adjustments to the fixed recovery amounts and any associated fixed recovery tax amounts that are the subject of the pertinent financing order, as required by subdivision (g). The procedure shall require the commission to determine whether the adjustments are required on each anniversary of the issuance of the financing order, and at the additional intervals as may be provided for in the financing order, and for the adjustments, if required, to be approved within 90 days of each anniversary of the issuance of the financing order, or of each additional interval provided for in the financing order.
Fixed recovery amounts are recovery property when, and to the extent that, a financing order authorizing the fixed recovery amounts has become effective in accordance with this article, and the recovery property shall thereafter continuously exist as property for all purposes with all of the rights and privileges of this article for the period and to the extent provided in the financing order, but in any event until the recovery bonds are paid in full, including all principal, interest, premium, costs, and arrearages thereon.
This article and any financing order made pursuant to this article do not amend, reduce, modify, or otherwise affect the right of the Department of Water Resources to recover its revenue requirements and to receive the charges that it is to recover and receive pursuant to Division 27 (commencing with Section 80000) of the Water Code, or pursuant to any agreement entered into by the commission and the Department of Water Resources pursuant to that division.
The financing entity may issue recovery bonds upon approval by the commission in the pertinent financing orders. Recovery bonds shall be nonrecourse to the credit or any assets of the recovery corporation, other than the recovery property as specified in the pertinent financing order.
The recovery corporation may sell and assign all or portions of its interest in recovery property to one or more financing entities that make that recovery property the basis for issuance of recovery bonds, to the extent approved in the financing order. The recovery corporation or financing entity may pledge recovery property as collateral, directly or indirectly, for recovery bonds to the extent approved in the pertinent financing orders providing for a security interest in the recovery property, in the manner set forth in Section 848.3. In addition, recovery property may be sold or assigned by (1) the financing entity or a trustee for the holders of recovery bonds in connection with the exercise of remedies upon a default, or (2) any person acquiring the recovery property after a sale or assignment pursuant to this subdivision.
To the extent that any interest in recovery property is so sold or assigned, or is so pledged as collateral, the commission shall authorize the recovery corporation to contract with the financing entity that it will continue to operate its system to provide service to consumers within its service territory, will collect amounts in respect of the fixed recovery amounts for the benefit and account of the financing entity, and will account for and remit these amounts to or for the account of the financing entity. Contracting with the financing entity in accordance with that authorization shall not impair or negate the characterization of the sale, assignment, or pledge as an absolute transfer, a true sale, or security interest, as applicable.
Notwithstanding Section 1708 or any other provision of law, any requirement under this article or a financing order that the commission take action with respect to the subject matter of a financing order shall be binding upon the commission, as it may be constituted from time to time, and any successor agency exercising functions similar to the commission, and the commission shall have no authority to rescind, alter, or amend that requirement in a financing order. The approval by the commission in a financing order of the issuance by the recovery corporation or a financing entity of recovery bonds shall include the approvals, if any, as may be required by Article 5 (commencing with Section 816) and Section 701.5. Nothing in Section 701.5 shall be construed to prohibit the issuance of recovery bonds upon the terms and conditions as may be approved by the commission in a financing order. Section 851 is not applicable to the transfer or pledge of recovery property, the issuance of recovery bonds, or related transactions approved in a financing order.
A security interest in recovery property is valid, is enforceable against the pledgor and third parties, subject to the rights of any third parties holding security interests in the recovery property perfected in the manner described in this section, and attaches when all of the following have taken place:
The commission has issued the financing order authorizing the fixed recovery amounts included in the recovery property.
Value has been given by the pledgees of the recovery property.
The pledgor has signed a security agreement covering the recovery property.
A valid and enforceable security interest in recovery property is perfected when it has attached and when a financing statement has been filed in accordance with Chapter 5 (commencing with Section 9501) of Division 9 of the Commercial Code naming the pledgor of the recovery property as “debtor” and identifying the recovery property. Any description of the recovery property shall be sufficient if it refers to the financing order creating the recovery property. A copy of the financing statement shall be filed with the commission by the recovery corporation that is the pledgor or transferor of the recovery property, and the commission may require the recovery corporation to make other filings with respect to the security interest in accordance with procedures it may establish, provided that the filings shall not affect the perfection of the security interest.
A perfected security interest in recovery property is a continuously perfected security interest in all revenues and proceeds arising with respect thereto, whether or not the revenues or proceeds have accrued. Conflicting security interests shall rank according to priority in time of perfection. Recovery property shall constitute property for all purposes, including for contracts securing recovery bonds, whether or not the revenues and proceeds arising with respect thereto have accrued.
Subject to the terms of the security agreement covering the recovery property and the rights of any third parties holding security interests in the recovery property perfected in the manner described in this section, the validity and relative priority of a security interest created under this section is not defeated or adversely affected by the commingling of revenues arising with respect to the recovery property with other funds of the recovery corporation that is the pledgor or transferor of the recovery property, or by any security interest in a deposit account of that recovery corporation perfected under Division 9 (commencing with Section 9101) of the Commercial Code into which the revenues are deposited. Subject to the terms of the security agreement, upon compliance with the requirements of paragraph (1) of subdivision (b) of Section 9312 of the Commercial Code, the pledgees of the recovery property shall have a perfected security interest in all cash and deposit accounts of the recovery corporation in which revenues arising with respect to the recovery property have been commingled with other funds, but the perfected security interest shall be limited to an amount not greater than the amount of the revenues with respect to the recovery property received by the recovery corporation within 12 months before (1) any default under the security agreement or (2) the institution of insolvency proceedings by or against the recovery corporation, less payments from the revenues to the pledgees during that 12-month period.
If an event of default occurs under the security agreement covering the recovery property, the pledgees of the recovery property, subject to the terms of the security agreement, shall have all rights and remedies of a secured party upon default under Division 9 (commencing with Section 9101) of the Commercial Code, and are entitled to foreclose or otherwise enforce their security interest in the recovery property, subject to the rights of any third parties holding prior security interests in the recovery property perfected in the manner provided in this section. In addition, the commission may require in the financing order creating the recovery property that, in the event of default by the recovery corporation in payment of revenues arising with respect to the recovery property, the commission and any successor thereto, upon the application by the pledgees or transferees, including transferees under Section 848.4, of the recovery property, and without limiting any other remedies available to the pledgees or transferees by reason of the default, shall order the sequestration and payment to the pledgees or transferees of revenues arising with respect to the recovery property. Any order shall remain in full force and effect notwithstanding any bankruptcy, reorganization, or other insolvency proceedings with respect to the debtor. Any surplus in excess of amounts necessary to pay principal, premium, if any, interest, costs, and arrearages on the recovery bonds, and other costs arising under the security agreement, shall be remitted to the debtor.
This section sets forth the terms by which a consensual security interest can be created and perfected in the recovery property. Unless otherwise ordered by the commission with respect to any series of recovery bonds on or prior to the issuance of the series, there shall exist a statutory lien as provided in this subdivision. Upon the effective date of the financing order, there shall exist a first priority lien on all recovery property then existing or thereafter arising pursuant to the terms of the financing order. This lien shall arise by operation of this section automatically without any action on the part of the recovery corporation, any affiliate thereof, the financing entity, or any other person. This lien shall secure all obligations, then existing or subsequently arising, to the holders of the recovery bonds issued pursuant to the financing order, the trustee or representative for the holders, and any other entity specified in the financing order. The persons for whose benefit this lien is established shall, upon the occurrence of any defaults specified in the financing order, have all rights and remedies of a secured party upon default under Division 9 (commencing with Section 9101) of the Commercial Code, and are entitled to foreclose or otherwise enforce this statutory lien in the recovery property. This lien attaches to the recovery property regardless of who owns, or is subsequently determined to own, the recovery property, including the recovery corporation, any affiliate thereof, the financing entity, or any other person. This lien shall be valid, perfected, and enforceable against the owner of the recovery property and all third parties upon the effectiveness of the financing order without any further public notice; provided, however, that any person may, but is not required to, file a financing statement in accordance with subdivision (b). Financing statements so filed may be “protective filings” and are not evidence of the ownership of the recovery property.
A perfected statutory lien in recovery property is a continuously perfected lien in all revenues and proceeds arising with respect thereto, whether or not the revenues or proceeds have accrued. Conflicting liens shall rank according to priority in time of perfection. Recovery property shall constitute property for all purposes, including for contracts securing recovery bonds, whether or not the revenues and proceeds arising with respect thereto have accrued.
In addition, the commission may require, in the financing order creating the recovery property, that, in the event of default by the recovery corporation in the payment of revenues arising with respect to recovery property, the commission and any successor thereto, upon the application by the beneficiaries of the statutory lien, and without limiting any other remedies available to the beneficiaries by reason of the default, shall order the sequestration and payment to the beneficiaries of revenues arising with respect to the recovery property. Any order shall remain in full force and effect notwithstanding any bankruptcy, reorganization, or other insolvency proceedings with respect to the debtor. Any surplus in excess of amounts necessary to pay principal, premium, if any, interest, costs, and arrearages on the recovery bonds, and other costs arising in connection with the documents governing the recovery bonds, shall be remitted to the debtor.
A transfer of recovery property by the recovery corporation to an affiliate or to a financing entity, or by an affiliate of the recovery corporation or a financing entity to another financing entity, which the parties in the governing documentation have expressly stated to be a sale or other absolute transfer, in a transaction approved in a financing order, shall be treated as an absolute transfer of all of the transferor’s right, title, and interest (as in a true sale), and not as a pledge or other financing, of the recovery property, other than for federal and state income and franchise tax purposes. The grant to holders of recovery bonds of a preferred right to revenues of the recovery corporation, or the provision by the company of other credit enhancement with respect to recovery bonds, shall not impair or negate the characterization of any transfer as a true sale, other than for federal and state income and franchise tax purposes.
A transfer of recovery property shall be deemed perfected as against third persons when both of the following have taken place:
The commission has issued the financing order authorizing the fixed recovery amounts included in the recovery property.
An assignment of the recovery property in writing has been executed and delivered to the transferee.
As between bona fide assignees of the same right for value without notice, the assignee first filing a financing statement in accordance with Chapter 5 (commencing with Section 9501) of Division 9 of the Commercial Code naming the assignor of the recovery property as debtor and identifying the recovery property has priority. Any description of the recovery property is sufficient if it refers to the financing order creating the recovery property. A copy of the financing statement shall be filed by the assignee with the commission, and the commission may require the assignor or the assignee to make other filings with respect to the transfer in accordance with procedures it may establish, but these filings shall not affect the perfection of the transfer.
Any successor to the recovery corporation, whether pursuant to any bankruptcy, reorganization, or other insolvency proceeding, or pursuant to any merger, sale, or transfer, by operation of law, or otherwise, shall perform and satisfy all obligations of the recovery corporation pursuant to this article in the same manner and to the same extent as the recovery corporation, including, but not limited to, collecting and paying to the holders of recovery bonds, or their representatives, or the applicable financing entity revenues arising with respect to the recovery property sold to the applicable financing entity or pledged to secure recovery bonds. Any successor to the recovery corporation is entitled to receive any fixed recovery tax amounts otherwise payable to the recovery corporation.
The authority of the commission to issue financing orders pursuant to Section 848.1 shall expire on December 31, 2006. The expiration of the authority shall have no effect upon financing orders adopted by the commission pursuant to this article or any recovery property arising therefrom, or upon the charges authorized to be levied thereunder, or the rights, interests, and obligations of the recovery corporation or a financing entity or holders of recovery bonds pursuant to the financing order, or the authority of the commission to monitor, supervise, or take further action with respect to the order in accordance with the terms of this article and of the order.
Notwithstanding subdivision (g) of Section 848.1, the commission shall credit ratepayers, in a manner to be determined by the commission, with the net after tax amount of any payments, offsets, or other credits the recovery corporation actually receives from generators of electricity or other energy suppliers that would have reduced the unamortized balance of the recovery corporation’s regulatory asset created under the commission’s Decision No. 03-12-035 but for the prior issuance of recovery bonds.
Notwithstanding any other law, regulations adopted to implement this article are not subject to the rulemaking provisions of the Administrative Procedure Act (Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code).
ARTICLE 5.7. Monterey Peninsula Water Supply Securitization Act [849. - 849.6.]
For purposes of this article, the following definitions shall apply:
“Ancillary agreement” means a bond insurance policy, letter of credit, reserve account, surety bond, swap arrangement, hedging arrangement, liquidity or credit support arrangement, or other similar agreement or arrangement entered into in connection with the issuance of water rate relief bonds that is designed to promote the credit quality and marketability of the bonds or to mitigate the risk of an increase in interest rates.
“Customer” means an individual, governmental body, trust, business entity, or nonprofit organization that is a customer of the qualifying water utility, has responsibility for a service address provided water service by the utility, or consumes water that has been transmitted or distributed by means of distribution facilities.
“District” means the Monterey Peninsula Water Management District, or its successor or assignee.
“Financing costs” means the costs to issue, service, repay, or refinance water rate relief bonds, whether incurred or paid upon issuance of the bonds or over the life of the bonds, and approved for recovery by the commission in a financing order. “Financing costs” may include any of the following:
Principal, interest, and redemption premiums that are payable on water rate relief bonds.
A payment required under an ancillary agreement and an amount required to fund or replenish a reserve account or other account established under an indenture, ancillary agreement, or other financing document relating to the water rate relief bonds.
Costs of retiring or funding an existing debt and equity security of a qualifying water utility in connection with the issuance of water rate relief bonds to the extent the securities were issued for the purpose of financing water supply costs.
Costs incurred by, on behalf of, or allocated to, a qualifying water utility to obtain modifications of, or amendments to, an indenture, financing agreement, security agreement, or similar agreement or instrument relating to an existing secured or unsecured obligation of a qualifying water utility or an affiliate of a qualifying water utility, or any costs incurred by or allocated to a qualifying water utility to obtain the consent, release, waiver, or approval from the holder of the obligation, that are necessary to be incurred to permit a qualifying water utility to issue or cause the issuance of water rate relief bonds.
Taxes, franchise fees, or license fees imposed on water supply charges.
Costs related to issuing and servicing water rate relief bonds or the application for a financing order, including, without limitation, servicing fees and expenses, trustee fees and expenses, legal fees and expenses, accounting fees, administrative fees, underwriting and placement fees, financial advisory fees, capitalized interest, rating agency fees, and any other related costs that are approved for recovery in the financing order, including costs incurred by a public financing entity.
Other costs as specifically authorized by a financing order.
“Financing entity” means either or both of the following:
The qualifying water utility, or its subsidiary or affiliate, that is authorized by the commission to issue water rate relief bonds, or acquire water supply property, or both, pursuant to a financing order.
A public financing entity authorized to issue water rate relief bonds pursuant to a financing order.
“Financing order” means an order of the commission adopted in accordance with this article, which shall include a procedure for periodic true-up adjustments to water supply charges.
“Qualifying water utility” means California American Water, or any successor public utility described in Section 2701 of the Public Utilities Code that is engaged in the delivery of water to customers on the Monterey Peninsula.
“Public financing entity” means any of the following:
The district.
A joint exercise of powers authority in which the district is a member.
A public agency that is authorized to issue water rate relief bonds, or acquire water supply property, or both.
“Service territory” means the geographical area within or surrounding the Monterey Peninsula that the qualifying water utility provides water service to in accordance with its certificate of public convenience and necessity and within which water supply charges may be imposed and collected as further described in the financing order.
“True-up adjustment” means a formula-based adjustment to the water supply charges as they appear on customer bills that are necessary to correct for any overcollection or undercollection of the water supply charges authorized by a financing order and to otherwise ensure the timely and complete payment and recovery of water supply costs and financing costs over the authorized repayment term.
“Water rate relief bonds” means bonds, notes, certificates of participation or beneficial interest, or other evidences of indebtedness or ownership, issued pursuant to an executed indenture or other agreement of a financing entity, the proceeds of which are used, directly or indirectly, to provide, recover, finance, or refinance water supply costs and financing costs, and that are directly or indirectly secured by, or payable from, water supply property. Water rate relief bonds may be issued simultaneously by two financing entities, but water rate relief bonds shall not be issued after the seventh anniversary of a financing order issued in connection with commission proceeding A.12-04-019. Water rate relief bonds may be issued for a term not to exceed 30 years.
“Water supply activity” means an activity or activities by or on behalf of a qualifying water utility in connection with the acquisition and construction of infrastructure directly related to a desalination facility and necessary equipment solely for that facility, including the pipes necessary for conveyance and tanks necessary for water storage, as authorized by the commission in proceeding A.12-04-019.
“Water supply charges” means those nonbypassable charges that are authorized by the commission in a financing order to recover water supply costs and all financing costs specified in a financing order.
“Water supply costs” means any reasonable and necessary costs, including capitalized interest costs relating to regulatory assets and capitalized costs associated with permitting, design, and engineering work, approved in a financing order, incurred or expected to be incurred by a qualifying water utility in undertaking water supply activities. Water supply costs include preliminary expenses and investments associated with water supply activities that are incurred before the issuance of a financing order and that are to be reimbursed from the proceeds of water rate relief bonds.
“Water supply property” means the property right created pursuant to this article, including, without limitation, the right, title, and interest of the qualifying water utility or its transferee in all of the following:
In and to the water supply charges established pursuant to a financing order, including all rights to obtain adjustments to the water supply charges in accordance with Section 849.1 and the financing order.
To be paid the amount that is determined in a financing order to be the amount that the qualifying water utility or its transferee is lawfully entitled to receive pursuant to the provisions of this article and the proceeds thereof, and in and to all revenues, collections, claims, payments, money, or proceeds of or arising from the water supply charges that are the subject of a financing order.
“Water supply property” shall constitute a current property right notwithstanding the fact that the value of the property right will depend on customers using water or, in those instances where customers are customers of the qualifying water utility, the qualifying water utility performing certain services.
The commission may issue financing orders in accordance with this article to facilitate the recovery, financing, or refinancing of water supply costs. A financing order may be adopted only upon the application of the qualifying water utility and shall become effective in accordance with its terms.
Commencing January 1, 2015, the qualifying water utility may apply to the commission for a determination that no more than 50 percent of the qualifying water utility’s water supply costs may be recovered through water supply charges, which would be water supply property under this article. The commission shall not approve an increase in a financing order that exceeds a total amount of 5 percent of the water supply costs.
A public financing entity that proposes to issue water rate relief bonds pursuant to Article 8 of Chapter 3 of Part 5 of the Monterey Peninsula Water Management District Law, as added by Chapter 527 of the Statutes of 1977, or Section 6537 of the Government Code, shall provide information as requested by the commission in connection with the application and proceeding.
In its application the qualifying water utility shall specify how customers may benefit from reduced rates on a present value basis through the issuance of water rate relief bonds as compared to the use of traditional utility financing mechanisms. If a public financing entity proposes to issue water rate relief bonds, it shall provide evidence to the commission that the issuance of water rate relief bonds by the public financing entity, due to the availability of a federal or state income tax exemption, will provide savings to water customers on the Monterey Peninsula.
The commission shall establish procedures for the expeditious processing of financing order applications, including the approval or disapproval of the qualifying water utility’s application, within 180 days of the application submission.
The commission shall authorize the imposition and collection of water supply charges in one or more financing orders if the commission determines, as part of its findings in connection with the financing order, that each imposition and collection of the water supply charges, and the issuance of water rate relief bonds payable from those charges, would reduce the rates on a present value basis that customers within the qualifying water utility’s service territory would pay as compared to the use of traditional utility financing mechanisms, which shall be calculated using the qualifying water utility’s corporate debt and equity in the ratio approved by the commission at the time of the issuance of the financing order. The commission’s determination shall consider all customer payments including rates, surcharges, taxes, water supply charges, and any other payments made by customers for water supply activities.
The commission shall establish in a financing order an effective mechanism that ensures recovery of water supply costs and financing costs through nonbypassable water supply charges. Water supply charges shall be imposed only on existing and future customers of the qualifying water utility’s service territory, and those customers shall be required to pay those charges until the water rate relief bonds and all financing costs are paid in full by the financing entity, at which time those charges shall be terminated. Water supply charges shall be irrevocable, notwithstanding any true-up adjustment pursuant to subdivision (g).
A financing order may specify how amounts collected from a customer shall be allocated between water supply charges and other charges of the qualifying water utility, consistent with Section 779.2.
Notwithstanding Section 455.5 or 1708, or any other provision of law, and except as otherwise provided in subdivision (g), water supply property that has been made the basis for the issuance of water rate relief bonds, the financing order, and the water supply charges shall be irrevocable. The commission shall not, either by rescinding, altering, or amending the financing order or otherwise, revalue or revise for ratemaking purposes the water supply costs or the financing costs, determine that the water supply charges are unjust or unreasonable, or in any way reduce or impair the value of water supply property either directly or indirectly by taking water supply charges into account when setting other rates for the qualifying water utility. The amount of revenues arising shall not be subject to reduction, impairment, postponement, or termination.
The State of California does hereby pledge and agree with the qualifying water utility, owners of water supply property, the financing entities, and owners of water rate relief bonds that the state shall neither limit nor alter, except as otherwise provided with respect to true-up adjustment of water supply charges pursuant to subdivision (g), the water supply charges, water supply property, financing orders, or any rights under a financing order until the water rate relief bonds, together with the interest on the bonds, and all related financing costs are fully paid and discharged, or, in the alternative, have been refinanced through an additional issue of water rate relief bonds, provided nothing contained in this section shall preclude the limitation or alteration if and when adequate provision shall be made by law for the protection of the qualifying water utility, financing entities, and owners. The financing entity is authorized to include this pledge and undertaking for the state in the water rate relief bonds.
Neither financing orders nor water rate relief bonds issued under this article shall constitute a debt or liability of the state or of any political subdivision of the state except a public financing entity, nor shall they constitute a pledge of the full faith and credit of the state or any of its political subdivisions, but are payable solely from the funds provided therefor under this article and shall be consistent with Sections 1 and 18 of Article XVI of the California Constitution. This subdivision shall not preclude bond guarantees or enhancements pursuant to this article or pursuant to Article 8 of Chapter 3 of Part 5 of the Monterey Peninsula Water Management District Law, as added by Chapter 527 of the Statutes of 1977, or Section 6537 of the Government Code. A water rate relief bond shall contain on the face of the bond a statement to the following effect: “Neither the full faith and credit nor the taxing power of the State of California is pledged to the payment of the principal of, or interest on, this bond.”
The issuance of water rate relief bonds under this article shall not directly, indirectly, or contingently obligate the state or any political subdivision of the state to levy or to pledge any form of taxation therefor or to make any appropriation for their payment. Nothing in this paragraph shall prevent or be construed to prevent a public financing entity from pledging water supply property, or payments made on water rate relief bonds, together with any reserves or overcollateralization amounts approved in a financing order, to the payment of the water rate relief bonds.
Any water supply charge authorized by a financing order shall appear on customer bills as a stand-alone, line-item surcharge. The commission shall, in any financing order, provide for a periodic true-up adjustment to water supply charges, which shall be made at least annually and may be made more frequently. The qualifying water utility shall file an advice letter with the commission to implement any true-up adjustment.
Water supply charges are water supply property when, and to the extent that, a financing order authorizing the water supply charges has become effective in accordance with this article, and the water supply property shall thereafter continuously exist as property for all purposes with all of the rights and privileges of this article for the period and to the extent provided in the financing order, but in any event until the water rate relief bonds, including all principal, premium, if any, and interest with respect to the bonds and all other financing costs are paid in full. A financing order may provide that the creation of water supply property shall be simultaneous with the sale of the water supply property to a transferee or assignee as provided in the application and the pledge of the water supply property to secure water rate relief bonds.
Any surplus water supply charges in excess of the necessary amounts to pay the principal premium, if any, and interest on the water rate relief bonds and all other financing costs shall be credited to customers through the adjustment mechanism described in subdivision (g) or used to prepay or defease water rate relief bonds, so long as this would not result in a recharacterization of the tax, accounting, and other intended characteristics of the financing, including, but not limited to, the following:
Avoiding the recognition of debt on the qualifying water utility’s balance sheet for financial accounting and regulatory purposes.
Treating the water rate relief bonds as debt of the qualifying water utility or its affiliates for federal income tax purposes.
Treating the transfer of the water supply property by the qualifying water utility as a true sale for bankruptcy purposes.
Avoiding any adverse impact of the financing on the qualifying water utility’s credit rating.
The commission shall, pursuant to its authority in Section 739.8, implement a program to exclude low-income water ratepayers participating in commission-approved, low-income rate assistance programs from the payment of any water supply charge imposed pursuant to this section, if it determines that the exclusion from the charge will have no significant impact on the ability of the financing entity to finance the water supply activity. The commission may also allow the adjustment of the amount of the charge, as necessary, to cover any costs associated with implementation of the exclusion.
A qualifying water utility for which a financing order has been issued shall cause the proceeds of any water rate relief bonds issued pursuant to a financing order to be placed in a separate account. A qualifying water utility may use the proceeds of the issuance of water rate relief bonds for paying water supply costs and financing costs and for no other purpose.
A financing order may require the qualifying utility to file with the commission a periodic report showing the receipt and disbursement of proceeds of water rate relief bonds. A financing order may authorize the staff of the commission to review and audit the books and records of the qualifying water utility relating to the receipt and disbursement of proceeds of water rate relief bonds. The provisions of this subdivision shall not be construed to limit the authority of the commission to investigate the practices of the qualifying utility or to audit the books and records of the qualifying water utility.
A qualifying water utility for which a financing order has been issued shall annually provide to its customers a concise explanation of the water supply charges approved in a financing order, as modified by subsequent issuances of water rate relief bonds authorized under a financing order, if any, and by application of the true-up adjustment mechanism as provided in the financing order. These explanations shall be made after the annual true-up adjustment pursuant to subdivision (g) of Section 849.1 and prior to, or simultaneous with, the effective date of the adjustment, and may be made by bill inserts, Internet Web site information, or other appropriate means. If water rate relief bonds are issued by a public financing entity, the public financing entity, or its trustee or representative, shall provide the information to the qualifying water utility as reasonably requested in order to comply with its obligations under this section.
The failure of a qualifying water utility to apply the proceeds of water rate relief bonds in a reasonable, prudent, and appropriate manner or otherwise comply with any provision of this section shall not invalidate, impair, or affect any financing order, water supply property, water supply charges, or water rate relief bonds.
Financing entities may issue water rate relief bonds upon approval by the commission in the financing order. Water rate relief bonds shall be nonrecourse to the credit or any assets of the qualifying water utility, other than the water supply property as specified in the financing order.
A qualifying water utility may sell and assign all or portions of its interest in water supply property to an affiliate. A qualifying water utility or its affiliates may sell or assign their interests to one or more financing entities authorized under this article that make that property the basis for issuance of water rate relief bonds to the extent approved in the financing order. A qualifying water utility, its affiliates, or financing entities may pledge and assign water supply property as collateral, directly or indirectly, to the extent approved in the financing order providing for a security interest in the water supply property, in the manner set forth in Section 849.4. In addition, water supply property may be sold or assigned by either of the following:
The financing entity or a trustee for the holders of water rate relief bonds or the holder of an ancillary agreement in connection with the exercise of remedies upon a default.
A person acquiring the water supply property after a sale or assignment made pursuant to this article.
To the extent that any interest in water supply property is sold, assigned, or pledged as collateral, the commission shall authorize the qualifying water utility to contract with the financing entity or entities that it will continue to operate its system to provide service to its customers, will collect water supply charges for the benefit and account of the financing entities and their pledgees, and will account for and remit these amounts to or for the account of the financing entities and their pledgees. Contracting with a financing entity in accordance with that authorization shall not impair or negate the characterization of the sale, assignment, or pledge as an absolute transfer, a true sale, or security interest, as applicable.
Water supply property that is specified in a financing order shall constitute an existing, present property right, notwithstanding the fact that the imposition and collection of water supply charges depend on the qualifying water utility continuing to provide water service or continuing to perform its servicing functions relating to the collection of water supply charges or on the level of future water consumption. Water supply property shall exist whether or not the water supply charges have been billed, have accrued, or have been collected and notwithstanding the fact that the value for a security interest in the water supply property, or amount of the water supply property, is dependent on the future provision of service to customers by the qualifying water utility. All water supply property specified in a financing order shall continue to exist until the water supply bonds issued pursuant to a financing order and all other financing costs are paid in full.
If a qualifying water utility defaults on any required payment of water supply charge revenues, a court, upon application by an interested party and without limiting any other remedies available to the applying party, shall order the sequestration and payment of the water supply charges, and the proceeds of the water supply charges, for the benefit of bondholders, any assignee and financing entities or their pledgees, and the counterparties to any ancillary agreement. The order shall remain in full force and effect notwithstanding bankruptcy, reorganization, or other insolvency proceedings with respect to the qualifying water utility or any affiliate of the qualifying water utility.
Water supply property, water supply charges, and the interests of an assignee, bondholder or financing entity, or any pledgee in water supply property and water supply charges are not subject to setoff, counterclaim, surcharge, or defense by the qualifying utility or any other person or in connection with the bankruptcy, reorganization, or other insolvency proceeding of the qualifying water utility, any affiliate of the qualifying water utility, or any other entity.
Notwithstanding Section 1708 or any other provision of law, any requirement under this article, or a financing order, that the commission take action with respect to the subject matter of a financing order, shall be binding upon the commission, as it may be constituted from time to time, and any successor agency exerting functions similar to the commission. The commission shall not have authority to rescind, alter, or amend that requirement in a financing order. The approval by the commission in a financing order of the issuance by the qualifying water utility or a financing entity of water rate relief bonds shall include the approvals, if any, required by Article 5 (commencing with Section 816) and Section 701.5. Section 701.5 shall not be construed to prohibit the issuance of water rate relief bonds upon the terms and conditions approved by the commission in a financing order. Section 851 is not applicable to the transfer or pledge of water supply property, the issuance of water rate relief bonds, or related transactions approved in a financing order.
A financing entity issuing water rate relief bonds shall include in its preliminary notice and final report for the water rate relief bonds submitted to the California Debt and Investment Advisory Commission pursuant to Section 8855 of the Government Code, a statement that the water rate relief bonds are being issued pursuant to this section. A financing entity issuing water rate relief bonds shall include in its final report for the water rate relief bonds submitted to the California Debt and Investment Advisory Commission pursuant to Section 8855 of the Government Code, the savings realized by issuing the water rate relief bonds rather than using traditional utility financing mechanisms.
A security interest in water supply property is valid, is enforceable against the pledgor and third parties, is subject to the rights of any third party holding a security interest in the water supply property perfected in the manner described in this section, and attaches when all of the following occur:
The commission has issued the financing order authorizing the water supply charges included in the water supply property.
Value has been given by the pledgees of the water supply property.
The pledgor has signed a security agreement that includes an indenture or financing agreement relating to the issuance of the water rater relief bonds covering the water supply property.
A valid and enforceable security interest in water supply property is perfected when it has attached and when a financing statement has been filed in accordance with Chapter 5 (commencing with Section 9501) of Division 9 of the Commercial Code, naming the pledgor of the water supply property as “debtor” and identifying the water supply property. Any description of the water supply property shall be sufficient if it refers to the financing order creating the water supply property. A copy of the financing statement shall be filed with the commission by the qualifying water utility that is the pledgor or transferor of the water supply property, and the commission may require the qualifying water utility to make other filings with respect to the security interest in accordance with procedures it may establish, provided that the filings do not affect the perfection of the security interest.
A perfected security interest in water supply property is a continuously perfected security interest in all revenues and proceeds arising with respect to the water supply property, whether or not the revenues or proceeds have accrued. Conflicting security interests shall rank according to priority in time of perfection. Water supply property shall constitute property for all purposes, including for contracts securing water rate relief bonds, whether or not the revenues and proceeds arising with respect to the water supply property have accrued.
Subject to the terms of the security agreement covering the water supply property and the rights of any third party holding a security interest in the water supply property perfected in the manner described in this section, the validity and relative priority of a security interest created under this section is not defeated or adversely affected by the commingling of revenues arising with respect to the water supply property with other funds of the qualifying water utility that is the pledgor or transferor of the water supply property, or by any security interest in a deposit account of that qualifying water utility perfected under Division 9 (commencing with Section 9101) of the Commercial Code into which the revenues are deposited. Subject to the terms of the security agreement, upon compliance with the requirements of subdivision (b) of Section 9312 of the Commercial Code, the pledgees of the water supply property shall have a perfected security interest in all cash and deposit accounts of the qualifying water utility in which revenues arising with respect to the water supply property have been commingled with other funds, but the perfected security interest shall be limited to an amount not greater than the amount of the revenues with respect to the water supply property received by the qualifying water utility within 12 months before either of the following:
A default under the security agreement.
The institution of insolvency proceedings by or against the qualifying water utility, less payments from the revenues to the pledgees during that 12-month period.
If a default occurs under the security agreement covering the water supply property, the pledgees of the water supply property, subject to the terms of the security agreement, shall have all rights and remedies of a secured party upon default under Division 9 (commencing with Section 9101) of the Commercial Code, and shall be entitled to foreclose or otherwise enforce their security interest in the water supply property, subject to the rights of any third party holding a prior security interest in the water supply property perfected in the manner provided in this section. In addition, the commission may require, in the financing order creating the water supply property, that in the event of default by the qualifying water utility in payment of revenues arising with respect to the water supply property, the commission and any successor to the commission, upon the application by the pledgees or transferees, including transferees under Section 849.5, of the water supply property, and without limiting any other remedies available to the pledgees or transferees by reason of the default, shall order the sequestration and payment to the pledgees or transferees of revenues arising with respect to the water supply property. Any order shall remain in full force and effect notwithstanding bankruptcy, reorganization, or other insolvency proceedings with respect to the debtor, pledgor, or transferor of the water supply property. Any surplus in excess of amounts necessary to pay principal, premium, if any, interest on the water rate relief bonds, and other financing costs arising under the security agreement, shall be remitted to the debtor or to the pledgor or transferor.
This section sets forth the terms by which a consensual security interest shall be created and perfected in the water supply property. Unless otherwise ordered by the commission with respect to any series of water rate relief bonds on or before the issuance of the series, there shall exist a statutory lien as provided in this subdivision.
Upon the effective date of the financing order, there shall exist a first priority lien on all water supply property then existing or thereafter arising pursuant to the terms of the financing order. This lien shall automatically arise pursuant to this section without any action on the part of the qualifying water utility, any affiliate of the qualifying water utility, the issuing entity, or any other person. This lien shall secure all obligations, then existing and subsequently arising, to the holders of the water rate relief bonds issued pursuant to the financing order, the trustee or representative for the holders, and any other entity specified in the financing order. The persons for whose benefit this lien is established shall, upon occurrence of any defaults specified in the financing order, have all rights and remedies of a secured party upon default under Chapter 1 (commencing with Section 9101) of Division 9 of the Commercial Code, and shall be entitled to foreclose or otherwise enforce this statutory lien in the water supply property. This lien shall attach to the water supply property regardless of who shall own, or shall subsequently be determined to own, the water supply property, including any qualifying water utility, affiliate of the qualifying water utility, financing entity, or any other person. This lien shall be valid, perfected, and enforceable against the owner of the water supply property and all third parties upon the effectiveness of the financing order without any further public notice, provided, however, that any person may, but shall not be required to, file a financing statement in accordance with subdivision (b). These financing statements may be protective filings and shall not be evidence of the ownership of the water supply property.
Notwithstanding any other provision of law, Section 5451 of the Government Code shall apply to any pledge by the public financing entity of water supply property or other security for any water rate relief bonds issued by a public financing entity.
A sale, assignment, or transfer of water supply property by a qualifying water utility to an affiliate or to a financing entity, or by an affiliate of a qualifying water utility or a financing entity to another financing entity, which the parties, in the governing documentation, have expressly stated to be a sale or other absolute transfer, in a transaction approved in a financing order, shall be treated as an absolute transfer of all of the transferor’s right, title, and interest, as in a true sale, and not as a pledge or other financing order of the water supply property, other than for federal and state income and franchise tax purposes.
The characterization of the sale, assignment, or transfer as an absolute transfer and true sale and the corresponding characterization of the property interest of the purchaser shall not be affected or impaired by, among other things, the occurrence of any of the following:
Commingling of water supply charge revenues with other amounts.
The retention by the seller of either of the following:
A partial or residual interest, including an equity interest, in the water supply property, whether direct or indirect, subordinate or otherwise.
The right to recover costs associated with taxes, franchise fees, or license fees imposed on the collection of water supply charge revenues.
Any recourse that the purchaser may have against the seller.
Any indemnification rights, obligations, or repurchase rights made or provided by the seller.
The obligation of the seller to collect water supply charge revenues on behalf of an assignee.
The treatment of the sale, assignment, or transfer for tax, financial reporting, or other purposes.
Any true-up adjustment of the water supply charges as provided in the financing order.
A sale, assignment, or transfer of water supply property shall be deemed perfected against third persons when both of the following occur:
As between bona fide assignees of the same right for value without notice, the assignee first filing a financing statement in accordance with Chapter 5 (commencing with Section 9501) of Division 9 of the Commercial Code naming the assignor of the water supply property as debtor and identifying the water supply property has priority. Any description of the water supply property shall be sufficient if it refers to the financing order creating the water supply property. A copy of the financing statement shall be filed by the assignee with the commission, and the commission may require the assignor or the assignee to make other filings with respect to the transfer in accordance with procedures it may establish, but these filings shall not affect the perfection of the transfer.
A successor to the qualified water utility, whether pursuant to bankruptcy, reorganization, or other insolvency proceeding, or pursuant to merger, sale, or transfer, by operation of law, or otherwise, shall perform and satisfy all obligations of the qualifying water utility pursuant to this article in the same manner and to the same extent as the qualified water utility, including, but not limited to, collecting and paying to the holders of water rate relief bonds or any financing entities or their pledgees revenues arising with respect to the water supply property sold to the applicable financing entity or pledged to secure water rate relief bonds.
ARTICLE 5.8. Catastrophic Wildfire and Ratepayer Protection Financing [850. - 850.8.]
This article applies in any of the following circumstances:
If an electrical corporation applies to the commission for recovery of costs and expenses related to a catastrophic wildfire and the commission finds some or all of the costs and expenses to be reasonable pursuant to Section 451.1, or for the amount of costs and expenses determined pursuant to subdivision (c) of Section 451.2, then the electrical corporation may file an application requesting the commission to issue a financing order to authorize these costs and expenses to be recovered through fixed recovery charges pursuant to this article.
If an electrical corporation submits an application for recovery of costs and expenses related to catastrophic wildfires, including fire risk mitigation capital expenditures identified in subdivision (e) of Section 8386.3 or subdivision (a) of Section 8386.10, in a proceeding to recover costs and expenses in rates and the commission finds that some or all of the costs and expenses identified in the electrical corporation’s application are just and reasonable pursuant to Section 451, the electrical corporation may file an application requesting the commission to issue a financing order to authorize the recovery of those just and reasonable costs and expenses by means of a financing order, with those costs and expenses being recovered through a fixed charge pursuant to this article. This paragraph does not apply for costs and expenses incurred by the electrical corporation after December 31, 2035.
Notwithstanding paragraphs (1) and (2), for a catastrophic wildfire that was ignited between January 1, 2025, and the effective date of this paragraph, if a large electrical corporation has settled or finally adjudicated claims and the Wildfire Fund assets are exhausted, the electrical corporation, before filing an application for a just and reasonable determination pursuant to Section 451 or 451.1, may file an application requesting the commission to issue a financing order to authorize the costs and expenses of those settled and finally adjudicated claims that cannot be paid by the Wildfire Fund to be recovered through fixed recovery charges pursuant to this article. For purposes of this paragraph, “large electrical corporation” and “Wildfire Fund assets” have the same meanings as set forth in Section 3280.
An electrical corporation may file an application requesting the commission to issue a financing order to authorize the recovery of verified incremental undercollection amounts for calendar year 2020 through fixed recovery charges pursuant to this article, if an electrical corporation’s annual true-up advice letter is accepted and either or both of the following incremental undercollection amounts are verified for calendar year 2020:
An incremental undercollection amount equal to the difference between the forecasted amount of billed revenues for that year, based on the authorized sales forecast, and the revenues actually billed by an electrical corporation with respect to all revenue balancing accounts, if the incremental amount as a percent of the forecasted amount of billed revenues for that year is at least 5 percent.
An incremental undercollection amount equal to the residential and small business customer bad debt expense recorded for that year that exceeds the bad debt expense for that year that was adopted by the commission in the general rate case, if the incremental undercollection amount is otherwise eligible for recovery in rates.
The incremental undercollection amounts subject to a commission-approved financing order shall be prohibited from being recovered through any other cost recovery application, mechanism, or request by the electrical corporation.
The commission shall ensure any costs included in incremental undercollections described in this paragraph and subject to a financing order are just and reasonable consistent with the requirements of subdivision (a) of Section 850.1.
In resolving a request for the issuance of a financing order, the commission may assign cost recovery to each customer class based on their contribution to the incremental undercollection described in this paragraph.
For purposes of this article, the following terms shall have the following meanings:
“Ancillary agreement” means a bond insurance policy, letter of credit, reserve account, surety bond, swap arrangement, hedging arrangement, liquidity or credit support arrangement, or other similar agreement or arrangement entered into in connection with the issuance of recovery bonds that is designed to promote the credit quality and marketability of the bonds or to mitigate the risk of an increase in interest rates.
“Consumer” means any individual, governmental body, trust, business entity, or nonprofit organization that consumes electricity that has been transmitted or distributed by means of electrical transmission or distribution facilities, whether those electrical transmission or distribution facilities are owned by the consumer, the electrical corporation, or any other party.
“Financing costs” means the costs to issue, service, repay, or refinance recovery bonds, whether incurred or paid upon issuance of the recovery bonds or over the life of the recovery bonds, if they are approved for recovery by the commission in a financing order. “Financing costs” may include any of the following:
Principal, interest, and redemption premiums that are payable on recovery bonds.
A payment required under an ancillary agreement.
An amount required to fund or replenish reserve accounts or other accounts established under an indenture, ancillary agreement, or other financing document relating to the recovery bonds.
Taxes, franchise fees, or license fees imposed on fixed recovery charges.
Costs related to issuing and servicing recovery bonds or the application for a financing order, including, without limitation, servicing fees and expenses, trustee fees and expenses, legal fees and expenses, accounting fees, administrative fees, underwriting and placement fees, financial advisory fees, original issue discount, capitalized interest, rating agency fees, and any other related costs that are approved for recovery in the financing order.
Other costs as specifically authorized by a financing order.
“Financing entity” means the electrical corporation or any subsidiary or affiliate of the electrical corporation that is authorized by the commission to issue recovery bonds or acquire recovery property, or both.
“Financing order” means an order of the commission adopted in accordance with this article, which shall include, without limitation, a procedure to require the expeditious approval by the commission of periodic adjustments to fixed recovery charges and to any associated fixed recovery tax amounts included in that financing order to ensure recovery of all recovery costs and the costs associated with the proposed recovery, financing, or refinancing thereof, including the costs of servicing and retiring the recovery bonds contemplated by the financing order.
“Fixed recovery charges” means those nonbypassable rates and other charges, including, but not limited to, distribution, connection, disconnection, and termination rates and charges, that are authorized by the commission in a financing order to recover both of the following:
Recovery costs specified in the financing order.
The costs of recovering, financing, or refinancing those recovery costs through a plan approved by the commission in the financing order, including the costs of servicing and retiring recovery bonds.
“Fixed recovery tax amounts” means those nonbypassable rates and other charges, including, but not limited to, distribution, connection, disconnection, and termination rates and charges, that are needed to recover federal and State of California income and franchise taxes associated with fixed recovery charges authorized by the commission in a financing order, but are not approved as financing costs financed from proceeds of recovery bonds.
“Recovery bonds” means bonds, notes, certificates of participation or beneficial interest, or other evidences of indebtedness or ownership, issued pursuant to an executed indenture or other agreement of a financing entity, the proceeds of which are used, directly or indirectly, to recover, finance, or refinance recovery costs, and that are directly or indirectly secured by, or payable from, recovery property.
“Recovery costs” means any of the following:
The catastrophic wildfire amounts or costs pursuant to paragraph (2) of subdivision (a) authorized by the commission in a financing order for recovery.
The incremental undercollection amounts that the commission authorizes for recovery in a financing order pursuant to paragraph (3) of subdivision (a).
Federal and State of California income and franchise taxes associated with recovery of the amounts pursuant to subparagraph (A) or (B).
Financing costs.
Professional fees, consultant fees, redemption premiums, tender premiums, and other costs incurred by the electrical corporation in using proceeds of recovery bonds to acquire outstanding securities of the electrical corporation, as authorized by the commission in a financing order.
“Recovery property” means the property right created pursuant to this article, including, without limitation, the right, title, and interest of the electrical corporation or its transferee:
In and to the fixed recovery charges established pursuant to a financing order, including all rights to obtain adjustments to the fixed recovery charges in accordance with Section 850.1 and the financing order.
To be paid the amount that is determined in a financing order to be the amount that the electrical corporation or its transferee is lawfully entitled to receive pursuant to the provisions of this article and the proceeds thereof, and in and to all revenues, collections, claims, payments, moneys, or proceeds of or arising from the fixed recovery charges that are the subject of a financing order.
“Recovery property” shall not include a right to be paid fixed recovery tax amounts.
“Recovery property” shall constitute a current property right, notwithstanding the fact that the value of the property right will depend on consumers using electricity or, in those instances where consumers are customers of the electrical corporation, the electrical corporation performing certain services.
“Revenue balancing account” means a balancing account reflecting the balance between the electrical corporation’s authorized revenue requirements relating to the volumetric sale of electricity and billed revenues associated with those sales. A revenue balancing account includes accounts reflecting the balance between the electrical corporation’s authorized distribution base revenue requirements and recorded billed revenues from authorized distribution rates, and accounts reflecting the difference between the amount of the discount provided to consumers enrolled in the California Alternative Rates for Energy (CARE) program and the CARE surcharge charged to non-CARE consumers.
“Revenue balancing account” shall not include amounts reflecting the balance between costs and expenses relating to fuel and purchased electricity by the electrical corporation.
“Service territory” means the geographical area that the electrical corporation provides with electrical distribution service.
“True-up adjustment” means a formulaic adjustment to the fixed recovery charges as they appear on customer bills that is necessary to correct for any overcollection or undercollection of the fixed recovery charges authorized by a financing order and to otherwise ensure the timely and complete payment and recovery of recovery costs over the authorized repayment term.
If an electrical corporation files for recovery of recovery costs and the commission finds some or all of those costs and expenses to be just and reasonable pursuant to Section 451 or 451.1, as applicable, or the commission allocates to the ratepayers some or all of those costs and expenses pursuant to subdivision (c) of Section 451.2, the commission may issue a financing order to allow recovery through fixed recovery charges, which would therefore constitute recovery property under this article, and order that any portion of the electrical corporation’s federal and State of California income and franchise taxes associated with those fixed recovery charges and not financed from proceeds of recovery bonds may be recovered through fixed recovery tax amounts.
Except as provided in clause (ii), following application by an electrical corporation, the commission shall issue a financing order if the commission determines that both of the following conditions are satisfied:
The recovery cost to be reimbursed from the recovery bonds have been found to be just and reasonable pursuant to Section 451 or 451.1, as applicable, or are allocated to the ratepayers pursuant to subdivision (c) of Section 451.2.
(II) The issuance of the recovery bonds, including all material terms and conditions of the recovery bonds, including, without limitation, interest rates, rating, amortization redemption, and maturity, and the imposition and collection of fixed recovery charges as set forth in an application satisfy all of the following conditions, as applicable:
(ia) They are just and reasonable.
(ib) They are consistent with the public interest.
The recovery of recovery costs through the designation of the fixed recovery charges and any associated fixed recovery tax amounts, and the issuance of recovery bonds in connection with the fixed recovery charges, would reduce, to the maximum extent possible, the rates on a present value basis that consumers within the electrical corporation’s service territory would pay as compared to the use of traditional utility financing mechanisms, which shall be calculated using the electrical corporation’s corporate debt and equity in the ratio approved by the commission at the time of the financing order.
The electrical corporation may request the determination specified in subparagraph (A) by the commission in a separate proceeding or in an existing proceeding or both. If the commission makes the determination specified in subparagraph (A), the commission shall establish, as part of the financing order, a procedure for the electrical corporation to submit applications from time to time to request the issuance of additional financing orders designating fixed recovery charges and any associated fixed recovery tax amounts as recoverable. The electrical corporation may submit an application with respect to recovery costs that an electrical corporation (i) has paid, (ii) has an existing legal obligation to pay, or (iii) would be obligated to pay pursuant to an executed settlement agreement. The commission shall, within 180 days of the filing of that application, issue a financing order, which may take the form of a resolution, if the commission determines that the amounts identified in the application are recovery costs.
Fixed recovery charges and any associated fixed recovery tax amounts shall be imposed only on existing and future consumers in the service territory. Consumers within the service territory shall continue to pay fixed recovery charges and any associated fixed recovery tax amounts until the recovery bonds and associated financing costs are paid in full by the financing entity.
An electrical corporation may exercise the same rights and remedies under its tariff and applicable law and regulation based upon a consumer’s nonpayment of fixed recovery charges and any associated fixed recovery tax as it could for a consumer’s failure to pay any other charge payable to that electrical corporation.
The commission may establish in a financing order an effective mechanism that ensures recovery of recovery costs through nonbypassable fixed recovery charges and any associated fixed recovery tax amounts from existing and future consumers in the service territory, and those consumers shall be required to pay those charges until the recovery bonds and all associated financing costs are paid in full by the financing entity, at which time those charges shall be terminated. Fixed recovery charges shall be irrevocable, notwithstanding the true-up adjustment pursuant to subdivision (g).
Recovery bonds authorized by the commission’s financing orders may be issued in one or more series on or before December 31, 2035.
The commission shall issue financing orders in accordance with this article to facilitate the recovery, financing, or refinancing of recovery costs. A financing order may be adopted only upon the application of the electrical corporation and shall become effective in accordance with its terms only after the electrical corporation files with the commission the electrical corporation’s written consent to all terms and conditions of the financing order. A financing order may specify how amounts collected from a consumer shall be allocated between fixed recovery charges, any associated fixed recovery tax amounts, and other charges.
Notwithstanding Section 455.5 or 1708, or any other law, and except as otherwise provided in subdivision (g), with respect to recovery property that has been made the basis for the issuance of recovery bonds and with respect to any associated fixed recovery tax amounts, the financing order, the fixed recovery charges, and any associated fixed recovery tax amounts shall be irrevocable. The commission shall not, either by rescinding, altering, or amending the financing order or otherwise, revalue or revise for ratemaking purposes the recovery costs or the costs of recovering, financing, or refinancing the recovery costs, in any way reduce or impair the value of recovery property or of the right to receive any associated fixed recovery tax amounts either directly or indirectly by taking fixed recovery charges or any associated fixed recovery tax amounts into account when setting other rates for the electrical corporation or when setting charges for the Department of Water Resources. The amount of revenues shall not be subject to reduction, impairment, postponement, or termination. The State of California does hereby pledge and agree with the electrical corporation, owners of recovery property, financing entities, and holders of recovery bonds that the state shall neither limit nor alter, except as otherwise provided with respect to the true-up adjustment of the fixed recovery charges pursuant to subdivision (i), the fixed recovery charges, any associated fixed recovery tax amounts, recovery property, financing orders, or any rights under a financing order until the recovery bonds, together with the interest on the recovery bonds and associated financing costs, are fully paid and discharged, and any associated fixed recovery tax amounts have been satisfied or, in the alternative, have been refinanced through an additional issue of recovery bonds, provided that nothing contained in this section shall preclude the limitation or alteration if and when adequate provision shall be made by law for the protection of the electrical corporation and of owners and holders of the recovery bonds. The financing entity is authorized to include this pledge and undertaking for the state in these recovery bonds. When setting other rates for the electrical corporation, nothing in this subdivision shall prevent the commission from taking into account either of the following:
Any collection of fixed recovery charges in excess of amounts actually required to pay recovery costs financed or refinanced by recovery bonds.
Any collection of fixed recovery tax amounts in excess of amounts actually required to pay federal and State of California income and franchise taxes associated with fixed recovery charges, provided that this would not result in a recharacterization of the tax, accounting, and other intended characteristics of the financing, including, but not limited to, either of the following:
Treating the recovery bonds as debt of the electrical corporation or its affiliates for federal income tax purposes.
Treating the transfer of the recovery property by the electrical corporation as a true sale for bankruptcy purposes.
Neither financing orders nor recovery bonds issued under this article shall constitute a debt or liability of the state or of any political subdivision thereof, nor shall they constitute a pledge of the full faith and credit of the state or any of its political subdivisions, but are payable solely from the funds provided therefor under this article and shall be consistent with Sections 1 and 18 of Article XVI of the California Constitution. All recovery bonds shall contain on the face thereof a statement to the following effect: “Neither the full faith and credit nor the taxing power of the State of California is pledged to the payment of the principal of, or interest on, this bond.”
The issuance of recovery bonds under this article shall not directly, indirectly, or contingently obligate the state or any political subdivision thereof to levy or to pledge any form of taxation therefor or to make any appropriation for their payment.
The commission shall establish procedures for the expeditious processing of an application for a financing order, which shall provide for the approval or disapproval of the application within 120 days of the application. Any fixed recovery charge authorized by a financing order shall appear on consumer bills. The commission shall, in any financing order, provide for a procedure for periodic true-up adjustments to fixed recovery charges, which shall be made at least annually and may be made more frequently. The electrical corporation shall file an application with the commission to implement any true-up adjustment.
Fixed recovery charges are recovery property when, and to the extent that, a financing order authorizing the fixed recovery charges has become effective in accordance with this article, and the recovery property shall thereafter continuously exist as property for all purposes, and all of the rights and privileges relating to that property accorded by this article shall continuously exist for the period and to the extent provided in the financing order, but in any event until the recovery bonds are paid in full, including all principal, premiums, if any, and interest with respect to the recovery bonds, and all associated financing costs are paid in full. A financing order may provide that the creation of recovery property shall be simultaneous with the sale of the recovery property to a transferee or assignee as provided in the application of the pledge of the recovery property to secure the recovery bonds.
Recovery costs shall not be imposed upon customers participating in the California Alternative Rates for Energy or Family Electric Rate Assistance programs discount pursuant to Section 739.1.
Any successor to a financing entity shall be bound by the requirements of this article and shall perform and satisfy all obligations of, and have the same rights under a financing order as and to the same extent as, the financing entity, including the obligation to collect and pay energy transition revenues to persons entitled to receive the revenues.
This article and any financing order made pursuant to this article do not amend, reduce, modify, or otherwise affect the right of the Department of Water Resources to recover its revenue requirements and to receive the charges that it is to recover and receive pursuant to Division 27 (commencing with Section 80000) and Division 28 (commencing with Section 80500) of the Water Code, or pursuant to any agreement entered into by the commission and the Department of Water Resources pursuant to the applicable division.
The financing entity may issue recovery bonds upon approval by the commission in a financing order. Recovery bonds shall be nonrecourse to the credit or any assets of the electrical corporation, other than the recovery property as specified in that financing order.
The electrical corporation may sell and assign all or portions of its interest in recovery property to one or more financing entities that make that recovery property the basis for issuance of recovery bonds, to the extent approved in a financing order. The electrical corporation or financing entity may pledge recovery property as collateral, directly or indirectly, for recovery bonds to the extent approved in the pertinent financing orders providing for a security interest in the recovery property, in the manner set forth in Section 850.3. In addition, recovery property may be sold or assigned by either of the following: (1) the financing entity or a trustee for the holders of recovery bonds or the holders of an ancillary agreement in connection with the exercise of remedies upon a default, or (2) any person acquiring the recovery property after a sale or assignment pursuant to this article.
To the extent that any interest in recovery property is sold, assigned, or is pledged as collateral pursuant to subdivision (b), the commission shall authorize the electrical corporation to contract with the financing entity that it will continue to operate its system to provide service to consumers within its service territory, will collect amounts in respect of the fixed recovery charges for the benefit and account of the financing entity, and will account for and remit these amounts to or for the account of the financing entity. Contracting with the financing entity in accordance with that authorization shall not impair or negate the characterization of the sale, assignment, or pledge as an absolute transfer, a true sale, or a security interest, as applicable. To the extent that billing, collection, and other related services with respect to the provision of electric service are provided to a consumer by any person or entity other than the electrical corporation in whose service territory the consumer is located, that person or entity shall collect the fixed recovery charges and any associated fixed recovery tax amounts from the consumer for the benefit and account of the electrical corporation or financing entity with the associated revenues remitted solely for the benefit and repayment of the recovery bonds and associated financing costs as a condition to the provision of electric service to that consumer. Each financing order shall impose terms and conditions, consistent with the purposes and objectives of this article, on any person or entity responsible for billing, collection, and other related services, including, without limitation, collection of the fixed recovery charges and any associated fixed recovery tax amounts, that are the subject of the financing order.
Recovery property that is specified in a financing order shall constitute an existing, present property right, notwithstanding the fact that the imposition and collection of fixed recovery charges depend on the electrical corporation continuing to provide electricity service or continuing to perform its servicing functions relating to the collection of fixed recovery charges or on the level of future electricity consumption. Recovery property shall exist whether or not the fixed recovery charges have been billed, have accrued, or have been collected and notwithstanding the fact that the value for a security interest in the recovery property, or amount of the recovery property, is dependent on the future provision of service to consumers. All recovery property specified in a financing order shall continue to exist until the recovery bonds issued pursuant to a financing order and all associated financing costs are paid in full.
Recovery property, fixed recovery charges, and the interests of an assignee, bondholder or financing entity, or any pledgee in recovery property and fixed recovery charges are not subject to setoff, counterclaim, surcharge, recoupment, or defense by the electrical corporation or any other person or in connection with the bankruptcy, reorganization, or other insolvency proceeding of the electrical corporation, any affiliate of the electrical corporation, or any other entity.
Notwithstanding Section 1708 or any other law, any requirement under this article or a financing order that the commission take action with respect to the subject matter of a financing order shall be binding upon the commission, as it may be constituted from time to time, and any successor agency exercising functions similar to the commission, and the commission shall have no authority to rescind, alter, or amend that requirement in a financing order. The approval by the commission in a financing order of the issuance by the electrical corporation or a financing entity of recovery bonds shall include the approvals, if any, as may be required by Article 5 (commencing with Section 816) and Section 701.5. Nothing in Section 701.5 shall be construed to prohibit the issuance of recovery bonds upon the terms and conditions as may be approved by the commission in a financing order. Section 851 is not applicable to the transfer or pledge of recovery property, the issuance of recovery bonds, or related transactions approved in a financing order.
A security interest in recovery property is valid, is enforceable against the pledgor and third parties, is subject to the rights of any third parties holding security interests in the recovery property perfected in the manner described in this section, and attaches when all of the following have taken place:
The commission has issued a financing order authorizing the fixed recovery charges included in the recovery property.
Value has been given by the pledgees of the recovery property.
The pledgor has signed a security agreement covering the recovery property.
A valid and enforceable security interest in recovery property is perfected when it has attached and when a financing statement has been filed in accordance with Chapter 5 (commencing with Section 9501) of Division 9 of the Commercial Code naming the pledgor of the recovery property as “debtor” and identifying the recovery property. Any description of the recovery property shall be sufficient if it refers to the financing order creating the recovery property. A copy of the financing statement shall be filed with the commission by the electrical corporation that is the pledgor or transferor of the recovery property, and the commission may require the electrical corporation to make other filings with respect to the security interest in accordance with procedures it may establish, provided that the filings shall not affect the perfection of the security interest.
A perfected security interest in recovery property is a continuously perfected security interest in all recovery property revenues and proceeds arising with respect thereto, whether or not the revenues or proceeds have accrued. Conflicting security interests shall rank according to priority in time of perfection. Recovery property shall constitute property for all purposes, including for contracts securing recovery bonds, whether or not the recovery property revenues and proceeds have accrued.
Subject to the terms of the security agreement covering the recovery property and the rights of any third parties holding security interests in the recovery property perfected in the manner described in this section, the validity and relative priority of a security interest created under this section is not defeated or adversely affected by the commingling of revenues arising with respect to the recovery property with other funds of the electrical corporation that is the pledgor or transferor of the recovery property, or by any security interest in a deposit account of that electrical corporation perfected under Division 9 (commencing with Section 9101) of the Commercial Code into which the revenues are deposited. Subject to the terms of the security agreement, upon compliance with the requirements of paragraph (1) of subdivision (b) of Section 9312 of the Commercial Code, the pledgees of the recovery property shall have a perfected security interest in all cash and deposit accounts of the electrical corporation in which recovery property revenues have been commingled with other funds, but the perfected security interest shall be limited to an amount not greater than the amount of the recovery property revenues received by the electrical corporation within 12 months before (1) any default under the security agreement or (2) the institution of insolvency proceedings by or against the electrical corporation, less payments from the revenues to the pledgees during that 12-month period.
If default occurs under the security agreement covering the recovery property, the pledgees of the recovery property, subject to the terms of the security agreement, shall have all rights and remedies of a secured party upon default under Division 9 (commencing with Section 9101) of the Commercial Code, and are entitled to foreclose or otherwise enforce their security interest in the recovery property, subject to the rights of any third parties holding prior security interests in the recovery property perfected in the manner provided in this section. In addition, the commission may require in the financing order creating the recovery property that, in the event of default by the electrical corporation in payment of recovery property revenues, the commission and any successor thereto, upon the application by the pledgees or transferees, including transferees under Section 850.4, of the recovery property, and without limiting any other remedies available to the pledgees or transferees by reason of the default, shall order the sequestration and payment to the pledgees or transferees of recovery property revenues. Any order shall remain in full force and effect notwithstanding any bankruptcy, reorganization, or other insolvency proceedings with respect to the debtor, pledgor, or transferor of the recovery property. Any surplus in excess of amounts necessary to pay principal, premiums, if any, interest, costs, and arrearages on the recovery bonds, and associated financing costs arising under the security agreement, shall be remitted to the debtor or to the pledgor or transferor.
This section sets forth the terms by which a consensual security interest shall be created and perfected in the recovery property. Unless otherwise ordered by the commission with respect to any series of recovery bonds on or prior to the issuance of the series, there shall exist a statutory lien as provided in this subdivision. Upon the effective date of the financing order, there shall exist a first priority lien on all recovery property then existing or thereafter arising pursuant to the terms of the financing order. This lien shall arise by operation of this section automatically without any action on the part of the electrical corporation, any affiliate thereof, the financing entity, or any other person. This lien shall secure all obligations, then existing or subsequently arising, to the holders of the recovery bonds issued pursuant to the financing order, the trustee or representative for the holders, and any other entity specified in the financing order. The persons for whose benefit this lien is established shall, upon the occurrence of any defaults specified in the financing order, have all rights and remedies of a secured party upon default under Division 9 (commencing with Section 9101) of the Commercial Code, and are entitled to foreclose or otherwise enforce this statutory lien in the recovery property. This lien attaches to the recovery property regardless of who owns, or is subsequently determined to own, the recovery property, including the electrical corporation, any affiliate thereof, the financing entity, or any other person. This lien shall be valid, perfected, and enforceable against the owner of the recovery property and all third parties upon the effectiveness of the financing order without any further public notice; provided, however, that any person may, but is not required to, file a financing statement in accordance with subdivision (b). Financing statements so filed may be “protective filings” and are not evidence of the ownership of the recovery property.
A perfected statutory lien in recovery property is a continuously perfected lien in all recovery property revenues and proceeds, whether or not the revenues or proceeds have accrued. Conflicting liens shall rank according to priority in time of perfection. Recovery property shall constitute property for all purposes, including for contracts securing recovery bonds, whether or not the recovery property revenues and proceeds have accrued.
In addition, the commission may require, in the financing order creating the recovery property, that, in the event of default by the electrical corporation in the payment of recovery property revenues, the commission and any successor thereto, upon the application by the beneficiaries of the statutory lien, and without limiting any other remedies available to the beneficiaries by reason of the default, shall order the sequestration and payment to the beneficiaries of recovery property revenues. Any order shall remain in full force and effect notwithstanding any bankruptcy, reorganization, or other insolvency proceedings with respect to the debtor. Any surplus in excess of amounts necessary to pay principal, premiums, if any, interest, costs, and arrearages on the recovery bonds, and other costs arising in connection with the documents governing the recovery bonds, shall be remitted to the debtor.
A transfer of recovery property by the electrical corporation to an affiliate or to a financing entity, or by an affiliate of the electrical corporation or a financing entity to another financing entity, which the parties in the governing documentation have expressly stated to be a sale or other absolute transfer, in a transaction approved in a financing order, shall be treated as an absolute transfer of all of the transferor’s right, title, and interest, as in a true sale, and not as a pledge or other financing, of the recovery property, other than for federal and state income and franchise tax purposes.
The characterization of the sale, assignment, or transfer as an absolute transfer and true sale and the corresponding characterization of the property interest of the purchaser shall not be affected or impaired by, among other things, the occurrence of any of the following:
Commingling of fixed recovery charge revenues with other amounts.
The retention by the seller of either of the following:
A partial or residual interest, including an equity interest, in the financing entity or the recovery property, whether direct or indirect, subordinate or otherwise.
The right to recover costs associated with taxes, franchise fees, or license fees imposed on the collection of fixed recovery charges.
Any recourse that the purchaser may have against the seller.
Any indemnification rights, obligations, or repurchase rights made or provided by the seller.
The obligation of the seller to collect fixed recovery charges on behalf of an assignee.
The treatment of the sale, assignment, or transfer for tax, financial reporting, or other purposes.
Any true-up adjustment of the fixed recovery charges as provided in the financing order.
A transfer of recovery property shall be deemed perfected against third persons when both of the following occur:
As between bona fide assignees of the same right for value without notice, the assignee first filing a financing statement in accordance with Chapter 5 (commencing with Section 9501) of Division 9 of the Commercial Code naming the assignor of the recovery property as debtor and identifying the recovery property has priority. Any description of the recovery property shall be sufficient if it refers to the financing order creating the recovery property. A copy of the financing statement shall be filed by the assignee with the commission, and the commission may require the assignor or the assignee to make other filings with respect to the transfer in accordance with procedures it may establish, but these filings shall not affect the perfection of the transfer.
Any successor to the electrical corporation, whether pursuant to any bankruptcy, reorganization, or other insolvency proceeding, or pursuant to any merger, sale, or transfer, by operation of law, or otherwise, shall perform and satisfy all obligations of the electrical corporation pursuant to this article in the same manner and to the same extent as the electrical corporation, including, but not limited to, collecting and paying to the holders of recovery bonds, or their representatives, or the applicable financing entity revenues arising with respect to the recovery property sold to the applicable financing entity or pledged to secure recovery bonds. Any successor to the electrical corporation is entitled to receive any fixed recovery tax amounts otherwise payable to the electrical corporation.
The authority of the commission to issue financing orders pursuant to Section 850.1 shall expire on December 31, 2035. The expiration of the authority shall have no effect upon financing orders adopted by the commission pursuant to this article or any recovery property arising therefrom, or upon the charges authorized to be levied thereunder, or the rights, interests, and obligations of the electrical corporation or a financing entity or holders of recovery bonds pursuant to the financing order, or the authority of the commission to monitor, supervise, or take further action with respect to the order in accordance with the terms of this article and of the order.
Notwithstanding subdivision (e) of Section 850.1, if, subsequent to the issuance of a financing order, an electrical corporation receives additional insurance proceeds, tax benefits, or other amounts that reimburse the electrical corporation for costs associated with catastrophic wildfire amounts included in the recovery costs addressed in that financing order, the electrical corporation shall credit customers, in a manner to be determined by the commission, with the net after tax amounts of those reimbursements, but the commission may not adjust, amend, or modify the catastrophic wildfire amounts, fixed recovery charges, the fixed recovery tax amounts, the financing order, recovery costs, the recovery property, or the recovery bonds.
Nothing in this section shall be construed to permit setoff, counterclaim, surcharge, recoupment, or defense by the electrical corporation or any other person, or in connection with the bankruptcy, reorganization, or other insolvency proceeding of the electrical corporation, any affiliate of the electrical corporation, or any other entity, against the recovery property, the fixed recovery charges, or the interests of an assignee, bondholder, or financing entity, or any pledgee in recovery property or fixed recovery charges.
This article shall not affect any civil action or proceeding.
ARTICLE 6. Transfer or Encumbrance of Utility Property [851. - 857.]
Except as provided in subdivision (c), a public utility, other than a common carrier by railroad subject to Part A of the Interstate Commerce Act (49 U.S.C. Sec. 10101 et seq.), shall not sell, lease, assign, mortgage, or otherwise dispose of, or encumber the whole or any part of, its railroad, street railroad, line, plant, system, or other property necessary or useful in the performance of its duties to the public, or any franchise or permit or any right thereunder, or by any means whatsoever, directly or indirectly, merge or consolidate its railroad, street railroad, line, plant, system, or other property, or franchises or permits or any part thereof, without first having either secured an order from the commission authorizing it to do so for qualified transactions valued above five million dollars ($5,000,000), or for qualified transactions valued at five million dollars ($5,000,000) or less, filed an advice letter and obtained approval from the commission authorizing it to do so. If the advice letter is uncontested, approval may be given by the executive director or the director of the division of the commission having regulatory jurisdiction over the utility. The commission shall determine the types of transactions valued at five million dollars ($5,000,000) or less, that qualify for advice letter handling. For a qualified transaction valued at five million dollars ($5,000,000) or less, the commission may designate a procedure different than the advice letter procedure if it determines that the transaction warrants a more comprehensive review. Absent protest or incomplete documentation, the commission shall approve or deny the advice letter within 120 days of its filing by the applicant public utility. The commission shall reject any advice letter that seeks to circumvent the five-million-dollar ($5,000,000) threshold by dividing a single asset with a value of more than five million dollars ($5,000,000) into component parts, each valued at less than five million dollars ($5,000,000). Every sale, lease, assignment, mortgage, disposition, encumbrance, merger, or consolidation made other than in accordance with the advice letter and approval from the commission authorizing it is void. The permission and approval of the commission to the exercise of a franchise or permit under Article 1 (commencing with Section 1001) of Chapter 5, or the sale, lease, assignment, mortgage, or other disposition or encumbrance of a franchise or permit under this article, shall not revive or validate any lapsed or invalid franchise or permit, or enlarge or add to the powers or privileges contained in the grant of any franchise or permit, or waive any forfeiture.
Subdivision (a) shall apply to any transaction described in subparagraph (F) of paragraph (1) of subdivision (b) of Section 854.2.
For any transaction described in subparagraph (F) of paragraph (1) of subdivision (b) of Section 854.2, as part of its review under subdivision (a), the commission shall determine whether the transaction is fair and reasonable to affected public utility employees, including both union and nonunion employees.
Each public utility shall annually file a Tier 1 advice letter with the commission by April 1, with a report of all transactions performed pursuant to paragraph (1), enumerated by date, value, location, and party.
This section does not prevent the sale, lease, encumbrance, or other disposition by any public utility of property that is not necessary or useful in the performance of its duties to the public, and any disposition of property by a public utility shall be conclusively presumed to be of property that is not useful or necessary in the performance of its duties to the public, as to any purchaser, lessee, or encumbrancer dealing with that property in good faith for value, provided that this section does not apply to the interchange of equipment in the regular course of transportation between connecting common carriers.
No public utility, and no subsidiary or affiliate of, or corporation holding a controlling interest in, a public utility, shall purchase or acquire, take or hold, any part of the capital stock of any other public utility, organized or existing under or by virtue of the laws of this state, without having been first authorized to do so by the commission; provided, however, that the commission may establish by order or rule categories of stock acquisitions which it determines will not be harmful to the public interest, and purchases within those categories are exempt from this section. Every assignment, transfer, contract, or agreement for assignment or transfer of any stock by or through any person or corporation to any corporation or otherwise in violation of any of the provisions of this article is void and of no effect, and no such transfer shall be made on the books of any public utility. Nothing in this section prevents the holding of stock previously lawfully acquired.
This article does not apply to any person or corporation which transacts no business subject to regulation under this part, except performing services or delivering commodities for or to public utilities or municipal corporations or other public agencies primarily for resale or use in serving the public or any portion thereof, but shall apply to any public utility, and any subsidiary or affiliate of, or corporation holding a controlling interest in, a public utility, if the commission finds, in a proceeding to which the public utility is or may become a party, that the application of this article is required by the public interest.
The commission may from time to time by order or rule, and subject to those terms and conditions as may be prescribed therein, exempt any public utility or class of public utility from this article if it finds that the application thereof with respect to the public utility or class of public utility is not necessary in the public interest. The commission may establish rules or impose requirements deemed necessary to protect the interest of the customers or subscribers of the public utility or class of public utility exempted under this subdivision. These rules or requirements may include, but are not limited to, notification of a proposed sale or transfer of assets or stock and provision for refunds or credits to customers or subscribers.
The provisions of Sections 851 and 854 that prohibit any assignment, acquisition, or change of control without advance authorization from the commission, do not apply to the transfer of the ownership interest in a water utility, with 10,000 or fewer service connections, from a decedent to a member of the decedent’s family in the manner provided in Section 240 of the Probate Code or by a will, trust, or other instrument.
It is the intent of the Legislature that transactions with monetary values that materially impact a public utility’s rate base should not qualify for expedited advice letter treatment pursuant to this article. It is the further intent of the Legislature that the commission maintain all of its oversight and review responsibilities subject to the California Environmental Quality Act, and that public utility transactions that jurisdictionally require a review by the commission, as the lead agency, under the act should not qualify for expedited advice letter treatment pursuant to this article. An advice letter may be filed for transactions by the public utility if the lead agency has completed the appropriate review under the California Environmental Quality Act for the transaction, and the commission is the responsible agency under the act. The advice letter shall be subject to approval by resolution voted upon by the commission.
For a water or sewer system corporation or an entity merging with or acquiring control of a water or sewer system corporation with less than 2,000 service connections, the following shall apply to transactions valued at five million dollars ($5,000,000) or less, notwithstanding Sections 851 and 854:
If a water or sewer system corporation or an entity merging with or acquiring control of a water or sewer system corporation fails to receive the commission’s approval pursuant to paragraph (1), the transaction is voidable by the commission until the commission does either of the following:
Retroactively approves the transaction upon a determination that the transaction is in the best interests of both the corporation and its ratepayers.
Conditionally approves the transaction, subject to the fulfillment of specified conditions that would ensure that the transaction is in the best interests of both the corporation and its ratepayers.
The commission may delegate the authority to make the determinations described in subdivision (a) to the director of the division that investigates water and sewer system service quality issues and analyzes and processes utility rate change requests.
A person or corporation, whether or not organized under the laws of this state, shall not directly or indirectly merge, acquire, or control, including pursuant to a change in control as described in subparagraphs (D) or (E) of paragraph (1) of subdivision (b) of Section 854.2, any public utility organized and doing business in this state without first securing authorization to do so from the commission. The commission may establish, by order or rule, the definitions of what constitutes a merger, acquisition, or control activity that is subject to this section. Any merger, acquisition, or control without that prior authorization is void. A public utility organized and doing business under the laws of this state, and a subsidiary or affiliate of, or corporation holding a controlling interest in, a public utility, shall not aid or abet any violation of this section.
Before authorizing the merger, acquisition, or control of any electrical, gas, or telephone corporation organized and doing business in this state, if any utility that is a party to the proposed transaction has gross annual California revenues exceeding five hundred million dollars ($500,000,000), the commission shall find that the proposal does all of the following:
Provide short-term and long-term economic benefits to ratepayers.
Equitably allocate, where the commission has ratemaking authority, the total short-term and long-term forecasted economic benefits, as determined by the commission, of the proposed merger, acquisition, or control, between shareholders and ratepayers. Ratepayers shall receive not less than 50 percent of those benefits.
Not adversely affect competition. In making this finding, the commission shall request an advisory opinion from the Attorney General regarding whether competition will be adversely affected and what mitigation measures could be adopted to avoid this result.
For an electrical or gas corporation, ensure the corporation will have an adequate workforce to maintain the safe and reliable operation of the utility assets.
Before authorizing the merger, acquisition, or control of any electrical, gas, or telephone corporation organized and doing business in this state, if any entity that is a party to the proposed transaction has gross annual California revenues exceeding five hundred million dollars ($500,000,000), the commission shall consider each of the criteria listed in paragraphs (1) to (8), inclusive, and find, on balance, that the merger, acquisition, or control proposal is in the public interest.
Be fair and reasonable to the majority of all affected public utility shareholders.
Be beneficial on an overall basis to state and local economies and to the communities in the area served by the resulting public utility.
Preserve the jurisdiction of the commission and the capacity of the commission to effectively regulate and audit public utility operations in the state.
Provide mitigation measures to prevent significant adverse consequences that may result.
A safety management system.
A comprehensive safety plan that includes a systemwide strategic approach for the safety of both employees and the public.
Plans to maintain or improve the records of the electrical corporation’s electric plant or gas corporation’s gas plant, including necessary audits to update incorrect or incomplete records of the electrical or gas corporation. For purposes of this subparagraph, “records” shall include, but not be limited to, locations, depth, age, maintenance and testing history, maps, surveys, patrols, and violation history of the electrical corporation’s electric plant or gas corporation’s gas plant.
Metrics to measure safety that are complete and drive appropriate behavior.
An appropriate evaluation of safety expertise in the list of qualifications used in selecting corporate leadership.
Active audits for safety controls.
A nonpunitive system for reporting potential safety incidents to the commission to facilitate the identification of accident precursors by persons familiar with the operations of the electrical or gas corporation, including, but not limited to, employees and contractors of the electrical or gas corporation, and the collection, analysis, and dissemination of unbiased safety information. An employee of, or the employee of a contractor performing work for, the electrical or gas corporation shall not be subject to demotion, discharge, or any other form of retaliation or discrimination for participating in the potential safety incident reporting system established pursuant to this subdivision.
When reviewing a merger, acquisition, or control proposal, the commission shall consider reasonable options to the proposal recommended by other parties, including no new merger, acquisition, or control, to determine whether comparable short-term and long-term economic savings can be achieved through other means while avoiding the possible adverse consequences of the proposal.
The person or corporation seeking acquisition or control of a public utility organized and doing business in this state shall have, before the commission, the burden of proving by a preponderance of the evidence that the requirements of subdivisions (b), (c), and (d) are met.
In determining whether an acquiring utility has gross annual revenues exceeding the amount specified in subdivisions (b) and (c), the revenues of an affiliate of that utility shall not be considered unless the affiliate was used to effect the merger, acquisition, or control.
Paragraphs (1) and (2) of subdivision (b) do not apply to the formation of a holding company.
For purposes of paragraphs (1) and (2) of subdivision (b), the Legislature does not intend to include acquisitions or changes in control that are mandated by either the commission or the Legislature as a result of, or in response to, any electric industry restructuring. However, the value of an acquisition or change in control may be used by the commission in determining the costs or benefits attributable to any electric industry restructuring and for allocating those costs or benefits for collection in rates.
The Legislature finds and declares all of the following:
California’s electric and gas utilities provide essential services to California residents and businesses, which are necessary to maintaining the vitality of California’s economy.
Consistent with Sections 913.4, 961, and 977, an adequately sized workforce of experienced electric and gas utility employees with the appropriate training and skills, as well as the knowledge of an electric or gas utility’s facilities and equipment, is essential to the safe, efficient, and uninterrupted provision of electrical and gas services. Safe and reliable electric and gas utility service is vital to public health, public safety, air quality, and reducing emissions of greenhouse gases.
Changes in the ownership or control of an electrical corporation or gas corporation may create uncertainty regarding the safe, efficient, and continuous provision of safe and reliable electrical and gas service to California consumers, leading to economic instability.
Mass displacement of electrical corporation or gas corporation workers as a result of a change in the ownership or control of an electrical corporation or gas corporation causes excessive reliance on the unemployment insurance system, and public social services and health programs, increasing costs to these vital governmental programs and placing a significant burden on the state and California taxpayers.
The state has a compelling interest in ensuring that when there is a change in the ownership or control of an electrical corporation or gas corporation, the new employer maintains a qualified and knowledgeable workforce with the ability to ensure safe, efficient, reliable, and continuous service to California consumers and communities.
Because of destructive and deadly wildfires and gas pipeline explosions, the electric and gas industries are in an unprecedented state of instability. One combined electrical and gas corporation has sought bankruptcy protection. All the major electrical corporations have had their credit ratings lowered to junk bond status or are at risk of downgrades to junk bond status. This jeopardizes the ability of these corporations to provide safe and reliable electric and gas service, to reduce the risk of future catastrophes, to provide service at just and reasonable rates, to meet the state’s mandates to reduce carbon emissions, and to address the risks of climate change.
There is a nationwide shortage of the qualified utility line workers and qualified line clearance tree trimmers needed to prevent and respond to wildfires, storms, and other major events. Because this work is performed on and near high voltage lines and other energized electrical equipment, these jobs require substantial training and are highly dangerous. Current efforts to hire enough qualified people to perform these functions have fallen short even though exceptional compensation packages are being offered. Any reduction in the number or qualifications of these employees would increase the risk to employees and the risk of future catastrophic wildfires, and would increase the frequency and duration of outages, particularly as a result of more common and more severe major storms. It is in the interest of the state and its citizens that utilities have the qualified workforce necessary to minimize the risk of future wildfires, to minimize future outages, and to restore service as promptly as possible after storms.
For the reasons provided in this subdivision, the Legislature must take action to stabilize the utility workforce so as to preserve the ability of utilities to provide safe and reliable electric and gas service. This requires that the size of the workforce be preserved or increased, and workers not be lost to other utilities offering more stable employment or better compensation.
For purposes of this section, the following definitions shall apply:
“Change of control” means any of the following:
A material change in ownership of the electric corporation or gas corporation, its parent company, or its holding company.
A filing seeking bankruptcy protection.
The sale of all or a material portion of the assets of the electrical corporation or gas corporation, its parent company, or its holding company, or any merger, consolidation, or acquisition of the electrical corporation or gas corporation, its parent company, or its holding company with, by, or into another corporation, entity, or person.
In the case of a combined electrical and gas corporation, the change in ownership of all or a substantial portion of either the gas or electric line of business of the combined corporation.
A voluntary or involuntary change in ownership of assets from an electrical or gas corporation to ownership by a public entity.
“Covered employee” means an individual who has been employed by an electrical corporation or gas corporation for at least 90 days immediately before a change of control affecting that individual’s principal place of employment. A change of control affects a covered employee’s principal place of employment where the change of control results in the predecessor employer transferring control of the place of employment to the successor employer.
“Covered employee” does not include any of the following:
A managerial, supervisory, or confidential employee.
A temporary employee.
A part-time employee who has worked less than 20 hours per week for the predecessor employer for at least 90 days immediately before the change of control.
“Person” means a corporation as defined in Section 204, a person as defined in Section 205, any other individual, corporation, partnership, limited partnership, limited liability partnership, limited liability company, business trust, estate, trust, association, joint venture, agency, instrumentality, or any other legal or commercial entity, whether domestic or foreign.
“Predecessor employer” means the person who controls the electric or gas utility before the change of control.
“Principal place of employment” of an employee means the office or other facility of the electrical corporation or gas corporation where the employee is principally assigned to work by the predecessor employer.
“Successor employer” means the person who controls the electrical corporation or gas corporation after the change of control.
“Total compensation” means the combined value of the covered employee’s wages and benefits immediately before the change of control. Total compensation may be paid entirely as wages or in any combination of wages and fringe benefits, to be determined by the successor employer. Total compensation includes, but is not necessarily limited to, both of the following amounts:
The covered employee’s hourly wage rate or the per diem value of the covered employee’s monthly salary.
Employer payments toward the covered employee’s health and welfare and pension benefits. Employer payments toward health and welfare and pension benefits shall include only those payments that are recognized as employer payments under paragraphs (1) and (2) of subdivision (b) of Section 1773.1 of the Labor Code.
“Transition period” means a period of 180 days immediately following the effective date of a change of control.
During the transition period, a successor employer shall not terminate a covered employee without cause.
This part shall not be construed to limit the right of covered employees to bring legal action for wrongful termination.
The rights and remedies provided pursuant to this section are in addition to, and are not intended to supplant, any existing rights or remedies.
No later than 15 days before the effective date of a change of control, a predecessor employer shall provide to the successor employer the name, address, date of hire, total compensation, and classification of each covered employee.
A successor employer shall retain the following written or electronic records for at least three years:
The list provided to the successor employer pursuant to subdivision (g).
Any offer of employment made to a covered employee.
Any termination of a covered employee during a transition period, including the reasons for the termination.
Any written evaluation of a covered employee.
For three years after the transition period and subject to the provisions of any existing collective bargaining agreement, a successor employer shall provide to employees who would have qualified as covered employees had they been employed during the 90-day period immediately before a change of control no less than the wages, hours, and other terms and conditions of employment provided before the change of control, including any previously negotiated increase in wages, and shall maintain no less than the total number of employees who would have qualified as covered employees had they been employed during the 90-day period immediately before a change of control. The successor employer may reduce the wages, hours, and other terms and conditions of employment or the total number of employees in a manner inconsistent with collective bargaining agreements only if authorized by the commission in a final, nonappealable decision. The commission shall not provide this authorization except on proof by a preponderance of the evidence in an application proceeding of all of the following:
A successor employer may terminate an employee with cause consistent with any applicable selective bargaining agreement during the period specified in subdivision (i).
A successor employer and a labor organization representing covered employees may, in a collective bargaining agreement, provide that the agreement supersedes the requirements of this section with respect to the represented employees.
The provisions of this section are severable. If any provision of this section or its application is held invalid, that invalidity shall not affect other provisions or applications that can be given effect without the invalid provision or application.
For purposes of this section, a “nonstate entity” means a company, corporation, partnership, firm, or other entity or group of entities, whether organized for profit or not for profit.
The commission, by order, decision, motion, settlement, or other action, shall not establish a nonstate entity with any moneys other than those moneys that would otherwise belong to the public utility’s shareholders. A nonstate entity to be created with moneys from a public utility’s shareholders shall be subject to a 30-day review by the Joint Legislative Budget Committee prior to creation. This subdivision does not limit the authority of the commission to form an advisory committee or other body whose budget is subject to oversight by the commission and the Department of Finance.
The commission shall not enter into a contract with a nonstate entity in which a person serves as an owner, director, or officer while serving as a commissioner. Any contract between the commission and a nonstate entity shall be void and cease to exist by operation of law, if a commissioner, who was a commissioner at the time the contract was awarded, entered into, or extended, becomes, on or after January 1, 2014, an owner, director, or officer of the nonstate entity while serving as a commissioner.
Beginning June 1, 2014, a commissioner who acts as an owner, director, or officer of a nonstate entity that was established as a result of an order, decision, motion, settlement, or other action by the commission in which the commissioner participated, neglects his or her duty pursuant to Section 1 of Article XII of the California Constitution, and as a result the commissioner may be removed pursuant to that section by the Legislature, two-thirds of the membership of each house concurring.
Every officer, agent, or employee of a public utility, or of a subsidiary or affiliate of, or a corporation holding a controlling interest in, a public utility, and every other person subject to the requirements of this article, who violates or fails to comply with, or procures, aids, or abets any violation of, this article is guilty of a misdemeanor.
A public utility that owns real property acquired for purposes of obtaining a utility right-of-way, may lease that property to a governmental entity for purposes of a public park, if the utility retains the use of the right-of-way for public utility purposes.
In determining whether a lease of real property to a governmental entity for park purposes is for fair value, the commission shall include the community benefits of parks and open space as a benefit to ratepayers.
As used in this section, “community benefits” include, but are not limited to, improving public health, protecting the environment, and increasing recreational assets.
ARTICLE 7. Controversies Concerning Relocation of Utility Improvements [861. - 861.]
As used in this section, “special law water district” means the Santa Clara Valley Water District and the Yuba-Bear River Basin Authority and, if created by an uncodified special law, any of the following: a county flood control district, a county flood control and water district, a county flood control and water conservation district, a county water conservation and flood control district, or a county water agency.
Whenever by court order or judgment in an eminent domain proceeding or by agreement a special law water district is required to relocate any improvements of a public utility, if the special law water district and the public utility fail to agree as to the character or location of the new improvements to be relocated by the special law water district, the character and location of such new improvements and any other controversy relating thereto shall be submitted to and determined by the Public Utilities Commission in the manner prescribed in Chapter 6 (commencing with Section 1201).
ARTICLE 8. Universal Telephone Service [871. - 884.5.]
This article shall be known and may be cited as the Moore Universal Telephone Service Act.
The Legislature finds and declares all of the following:
The offering of high-quality basic telephone service at affordable rates to the greatest number of citizens has been a longstanding goal of the state.
The Moore Universal Telephone Service Act has been, and continues to be, an important means for achieving universal service by making basic telephone service affordable to low-income households through the creation of a lifeline class of service.
Every means should be employed by the commission and telephone corporations to ensure that every household qualified to receive lifeline telephone service is informed of and is afforded the opportunity to subscribe to that service.
The furnishing of lifeline telephone service is in the public interest and should be supported fairly and equitably by every telephone corporation, and the commission, in administering the lifeline telephone service program, should implement the program in a way that is equitable, nondiscriminatory, and without competitive consequences for the telecommunications industry in California.
The Legislature finds and declares all of the following:
The Moore Universal Telephone Service Act, enacted in 1987, was intended to offer high quality basic telephone service at affordable rates to the greatest number of California residents, and has become an important means of achieving universal service by making residential service affordable to low-income citizens through the creation of a lifeline class of service.
Factors such as competition and technological innovation are resulting in the convergence of a variety of telecommunications technologies offering an expanded range of telecommunications services to users that incorporate voice, video, and data. These technologies have differing regulatory regimes and jurisdictions.
It is the intent of the Legislature that the commission initiate a proceeding investigating the feasibility of redefining universal telephone service by incorporating two-way voice, video, and data service as components of basic service. It is the Legislature’s further intent that, to the extent that the incorporation is feasible, that it promote equity of access to high-speed communications networks, the Internet, and other services to the extent that those services provide social benefits that include all of the following:
Improving the quality of life among the residents of California.
Expanding access to public and private resources for education, training, and commerce.
Increasing access to public resources enhancing public health and safety.
Assisting in bridging the “digital divide” through expanded access to new technologies by low-income, disabled, or otherwise disadvantaged Californians.
Shifting traffic patterns by enabling telecommuting, thereby helping to improve air quality in all areas of the state and mitigating the need for highway expansion.
For purposes of this section, the term “feasibility” means consistency with all of the following:
The commission shall annually do all of the following:
Designate a class of lifeline service necessary to meet minimum communications needs.
Set the rates and charges for that service.
Develop eligibility criteria for that service.
Assess the degree of achievement of universal service, including telephone penetration rates by income, ethnicity, and geography.
Minimum communications needs include, but are not limited to, the ability to originate and receive calls and the ability to access electronic information services.
The lifeline telephone service rates and charges shall be as follows:
In a residential subscriber’s service area where measured service is not available, the lifeline telephone service rates shall not be more than 50 percent of the rates for basic flat rate service, exclusive of federally mandated end user access charges, available to the residential subscriber.
In a residential subscriber’s service area where measured service is available, the subscriber may elect either of the following:
A lifeline telephone service measured rate of not more than 50 percent of the basic rate for measured service, exclusive of federally mandated end user access charges, available to the residential subscriber.
A lifeline flat rate of not more than 50 percent of the rates for basic flat rate service, exclusive of federally mandated end user access charges, available to the residential subscriber.
The lifeline telephone service installation or connection charge, or both, shall not be more than 50 percent of the charge for basic residential service installation or connection, or both. The commission may limit the number of installation and connection charges, or both, that may be incurred at the reduced rate in any given period.
There shall be no charge to the residential customer who has filed a valid eligibility statement for changing out of lifeline service.
The commission shall assess whether there is a problem with customers who fraudulently obtain lifeline telephone service. If the commission determines that there is a problem, it shall recommend and promulgate appropriate solutions. This assessment and the solutions determined by the commission shall not, in and of themselves, change the procedures developed pursuant to Section 876.
In addition to Section 874, every lifeline telephone service subscriber shall be given an allowance, reduced by the amount of any credit or allowance authorized by the Federal Communications Commission, equal to the then current or announced federally mandated residential end user access charges.
The commission may, in a separate proceeding, establish procedures necessary to ensure that the lifeline telephone service program qualifies for any federal funds available for the support of those programs.
The commission shall require every telephone corporation providing telephone service within a service area to file a schedule of rates and charges providing a class of lifeline telephone service. Every telephone corporation providing service within a service area shall inform all eligible subscribers of the availability of lifeline telephone service, and how they may qualify for and obtain service, and shall accept applications for lifeline telephone service according to procedures specified by the commission.
The commission, its staff, the lifeline program’s third-party administrator, and lifeline service providers, and their contractors, agents, successors, or assignees, shall not share, disclose, or otherwise make accessible any information provided by an applicant or subscriber to the lifeline program, or a subprogram or pilot program of the lifeline program, to any agency of a local government, a state government, or the federal government, or to any immigration authority without a court-ordered subpoena or valid judicial warrant.
This section does not prohibit the furnishing of applications, records, and data to other public agencies to the extent required for verifying an applicant’s or subscriber’s eligibility for lifeline service.
This section does not prohibit the commission, its staff, the lifeline program’s third-party administrator, or lifeline service providers from using aggregated subscriber or applicant data for analysis, reporting, or program management if the aggregated subscriber or applicant data cannot be used to determine the identities of the persons to whom the data pertains, alone or in combination with other data.
The commission, its staff, the lifeline program’s third-party administrator, and lifeline service providers, and the providers’ agents, successors, or assignees, may request, but may not require, applicants and subscribers to provide social security numbers, in whole or in part, to apply to, or participate in, the lifeline program.
To the extent Section 1621 of Title 8 of the United States Code applies to this article, the Legislature finds and declares that this article is a state law that may provide assistance and services for individuals not lawfully present in the United States within the meaning of subsection (d) of Section 1621 of Title 8 of the United States Code.
For purposes of this section, both of the following definitions apply:
“Immigration authority” means any federal, state, or local officer, employee, or person performing immigration enforcement functions.
“Immigration enforcement” includes any and all efforts to investigate, enforce, or assist in the investigation or enforcement of any federal civil immigration law, and also includes any and all efforts to investigate, enforce, or assist in the investigation or enforcement of any federal criminal immigration law that penalizes a person’s presence in, entry, or reentry to, or employment in, the United States.
Nothing in this article precludes the commission from changing any rate established pursuant to Section 873, either specifically or pursuant to any general restructuring of all telephone rates, charges, and classifications.
A lifeline telephone service subscriber shall be provided with one lifeline subscription, as defined by the commission, at the subscriber’s principal place of residence, and no other member of that subscriber’s family or household who maintains residence at that place is eligible for lifeline telephone service.
An applicant for lifeline telephone service may report only one address in this state as the principal place of residence.
Multiple lifeline telephone service subscribers may maintain the same address if they are not members of the same household.
For purposes of this section, the following definitions apply:
“Adult” means any person 18 years of age or older.
“Economic unit” means all adult individuals contributing to and sharing in the income and expenses of a household.
“Household” means any group of individuals, including the subscriber, who are living together at the same address and as one economic unit. A household may include related and unrelated persons. If an adult has no, or minimal, income and lives with someone who provides financial support to that adult, both persons shall be part of the same household. A child under 18 years of age and living with a parent or guardian shall be part of the same household as the parent or guardian.
The commission shall adopt a portability freeze rule for the lifeline program by January 15, 2017. The commission shall consider including all of the following in the rule:
A 60-day duration of the portability freeze.
A period of time when a subscriber would be able to terminate lifeline service without penalty, similar to that established in Section 4.13.5 of commission Decision 14-01-036 (January 16, 2014), Decision Adopting Revisions to Modernize and Expand the California Lifeline Program.
A requirement that the administrator of the lifeline program provide a telephone corporation providing lifeline service with real-time information concerning whether a subscriber has enrolled with another telephone corporation during the period of the portability freeze adopted by the commission pursuant to this section and, if the subscriber enrolled during this period, the date of enrollment.
Before March 1, 2022, the commission shall, as part of an existing proceeding, adopt updated rules for the lifeline program establishing a modified recertification process that minimizes barriers to lifeline subscriber recertification and reduces the burden and cost of recertification on the lifeline program.
The updated rules adopted pursuant to paragraph (1) shall do all of the following:
Enable a lifeline subscriber to enroll in the lifeline program directly online using an electronic signature.
Enable a lifeline subscriber to complete the annual recertification of lifeline eligibility process directly online using an electronic signature, or by telephone using a telephonic signature. The lifeline program’s third-party administrator shall verify the lifeline subscriber’s identity using the personally identifiable information that the administrator has on file. The commission shall not require a lifeline subscriber to use a commission-issued personal identification number (PIN) for identity verification.
Provide an option for lifeline subscribers to receive communications regarding their lifeline subscription in an electronic format, including, but not limited to, email and short message service.
Before January 1, 2023, the commission shall, as part of an existing proceeding and in consultation with lifeline service providers, the Federal Communications Commission, and the Universal Service Administrative Company, adopt updated rules for the lifeline program with the goal of achieving recertification rates at least equivalent to those rates achieved by the Universal Services Administrative Company as the administrator for the federal lifeline program.
The commission shall annually publicly report on its internet website the participation and recertification rates of eligible lifeline subscribers.
The commission shall, at least annually, initiate a proceeding to set rates for lifeline telephone service. All telephone corporations providing lifeline telephone service shall annually file, on a date set by the commission, proposed lifeline telephone service rates and a statement of projected revenue needs to meet the funding requirements to provide lifeline telephone service to qualified subscribers, together with proposed funding methods to provide the necessary funding. These funding methods shall include identification of those services whose rates shall be adjusted to provide the necessary funding.
The commission shall commence a proceeding within 30 days after the date set for the filings required in subdivision (a), giving interested parties an opportunity to comment on the proposed rates and funding requirements and the proposed funding methods. The commission may change the rates, funding requirements, and funding methods proposed by the telephone corporations in any manner necessary, including reasonably spreading the funding among the services offered by the telephone corporations, to meet the public interest. Within 60 days of the annual filing, the commission shall issue an order setting lifeline telephone service rates and funding methods for each telephone corporation making a filing as required in subdivision (a). The commission may establish a lifeline service pool composed of the rate adjustments and surcharges imposed by the commission pursuant to this section for the purpose of funding lifeline telephone service.
Any order issued by the commission pursuant to this section shall require telephone corporations providing lifeline telephone service to apply the funding requirement in the form of a surcharge to service rates which may be separately identified on the bills of customers using those services. The commission shall not allow any surcharge under this section on the rates charged by those telephone corporations for lifeline telephone service.
The commission shall permit telephone corporations operating between service areas to adjust the rates of any service which may be affected by any surcharge imposed by this section.
Notwithstanding Section 879, the commission shall issue its initial order adopting required rates and funding requirements not later than October 31, 1987, and prior to the issuance of that order, may fund lifeline telephone service through the use of an interim surcharge on service rates for telephone service provided by telephone corporations operating between service areas. The interim surcharge shall not exceed 4 percent of the service rates.
The commission may determine any question of fact in its administration of this article.
The Public Utilities Commission shall, as soon as practicable, open a proceeding or proceedings to, or as part of existing proceedings shall, consider ways to ensure that advanced telecommunications services are made available as ubiquitously and economically as possible, in a timely fashion, to California’s citizens, institutions, and businesses. The proceeding or proceedings should be completed within one year of commencement.
The proceeding or proceedings shall develop rules, procedures, orders, or strategies, or all of these, that seek to achieve the following goals:
To provide all citizens and businesses with access to the widest possible array of advanced communications services.
To provide the state’s educational and health care institutions with access to advanced communications services.
To ensure cost-effective deployment of technology so as to protect ratepayers’ interests and the affordability of telecommunications services.
In the proceeding or proceedings, the commission should also consider, but need not limit its consideration to, all of the following:
The commission shall, on or before February 1, 2001, issue an order initiating an investigation and opening a proceeding to examine the current and future definitions of universal service. That proceeding shall include public hearings that encourage participation by a broad and diverse range of interests from all areas of the state, including, but not limited to, all of the following:
Consumer groups.
Communication service providers, including all providers of high-speed access services.
Facilities-based telephone providers.
Information service providers and Internet access providers.
Rural and urban users.
Public interest groups.
Representatives of small and large businesses and industry.
Local agencies.
State agencies, including, but not limited to, all of the following:
The Government Operations Agency.
The State Department of Education.
The State Department of Public Health.
The California State Library.
Colleges and universities.
The objectives of the proceeding set forth in subdivision (a) shall include all of the following:
To investigate the feasibility of redefining universal service in light of current trends toward accelerated convergence of voice, video, and data, with an emphasis on the role of basic telecommunications and Internet services in the workplace, in education and workforce training, access to health care, and increased public safety.
To evaluate the extent to which technological changes have reduced the relevance of existing regulatory regimes given their current segmentation based upon technology.
To receive broad-based input from a cross section of interested parties and make recommendations on whether video, data, and Internet service providers should be incorporated into an enhanced Universal Lifeline Service program, as specified, including relevant policy recommendations regarding regulatory and statutory changes and funding options that are consistent with the principles set forth in subdivision (c) of Section 871.7.
To reevaluate prior definitions of basic service in a manner that will, to the extent feasible, effectively incorporate the latest technologies to provide all California residents with all of the following:
Improved quality of life.
Expanded access to public and private resources for education, training, and commerce.
Increased access to public resources enhancing public health and safety.
Assistance in bridging the “digital divide” through expanded access to new technologies by low income, disabled, or otherwise disadvantaged Californians.
To assess projected costs of providing enhanced universal lifeline service in accordance with the intent of this article, and to delineate the subsidy support needed to maintain the redefined scope of universal service in a competitive market.
To design and recommend an equitable and broad-based subsidy support mechanism for universal service in competitive markets in a manner that conforms with subdivision (c) of Section 871.7.
To develop a process to periodically review and revise the definition of universal service to reflect new technologies and markets consistent with subdivision (c) of Section 871.7.
To consider whether similar regulatory treatment for the provision of similar services is appropriate and feasible.
In conducting its investigation, the commission shall take into account the role played by a number of diverse but convergent industries and providers, even though many of these entities are not subject to economic regulation by the commission or any other government entity.
The recommendations of the commission shall be consistent with state policies for telecommunications as set forth in Section 709, and with all of the following principles:
It is the intent of the Legislature that any program administered by the commission that addresses the inequality of access to high-speed broadband services by providing those services to schools and libraries at a discounted price, provide comparable discounts to a nonprofit community technology program.
Notwithstanding any other law or existing program of the commission, but consistent with the purposes for which those funds were appropriated from the California Teleconnect Fund Administrative Committee Fund in Item 8660-001-0493 of Section 2.00 of the Budget Act of 2003 (Chapter 157 of the Statutes of 2003), and reappropriated in Item 8660-491 of Section 2.00 of the Budget Act of 2006 (Chapter 47 of the Statutes of 2006), the commission may expend up to two million dollars ($2,000,000) of the unencumbered amount of those funds for the nonrecurring installation costs for high-speed broadband services for community organizations that are eligible for discounted rates pursuant to Section 280.
For the purpose of this section:
“High-speed broadband services” means a system for the digital transmission of information over the Internet at a speed of at least 384 kilobits per second.
“Nonprofit community technology program” means a community-based nonprofit organization that is exempt from taxation under Section 501(c)(3) of the Internal Revenue Code and engages in diffusing technology into local communities and training local communities that have no access to, or have limited access to, the Internet and advanced telecommunications technologies.
The commission may require each internet service provider, as defined in Section 3100 of the Civil Code, to report the following information regarding each free, low-cost, income-qualified, or affordable internet service plan advertised by the provider:
The cost of the plan, including any fees and taxes.
The eligibility requirements for the plan.
The data limitations of the plan.
The number of California residents enrolled in the plan.
A description of the outreach efforts undertaken by the provider to eligible populations to increase awareness about the plan.
This section shall apply to all customers eligible to receive discounts for telecommunications services under the federal Universal Service E-rate program administered by the Schools and Libraries Division of the Universal Service Administrative Company that also apply for discounts on telecommunications services provided through the California Teleconnect Fund Administrative Committee Fund program pursuant to subdivision (a) of Section 280.
A teleconnect discount shall be applied after applying an E-rate discount. The commission shall first apply an E-rate discount, regardless of whether the customer has applied for an E-rate discount or has been approved, if the customer, in the determination of the commission, meets the eligibility requirements for an E-rate discount.
Notwithstanding subdivision (b), the teleconnect discount shall be applied without regard to an E-rate discount for a school district that meets the conditions specified for compensation pursuant to Article 4 (commencing with Section 42280) of Chapter 7 of Part 24 of Division 3 of Title 2 of the Education Code, unless that school district has applied for, and been approved to receive, the E-rate discount.
In establishing a discount under the California Teleconnect Fund Administrative Committee Fund program, the commission shall give priority to bridging the “digital divide” by encouraging expanded access to state-of-the-art technologies for rural, inner-city, low-income, and disabled Californians.
As used in this section:
“E-rate discount” means an actual discount under the E-rate program, or a representative discount figure as determined by the commission.
“E-rate program” means the federal Universal Service E-rate program administered by the Schools and Libraries Division of the Universal Service Administrative Company.
“Teleconnect discount” means a discount on telecommunications services provided through the California Teleconnect Fund Administrative Committee Fund program set forth in subdivision (a) of Section 280.
ARTICLE 9. Telephone Prepaid Debit Cards [885. - 887.]
Any entity offering the services of telephone prepaid debit cards is subject to the registration requirements of Section 1013, commencing January 1, 1999, unless that entity is certificated by the commission to provide telephone service. An entity subject to this requirement includes any of the following:
An entity that is an underlying interexchange carrier and offers and administers the services of telephone prepaid debit cards.
An entity that purchases bulk time from an underlying interexchange carrier and thereby offers and administers the services of telephone prepaid debit cards (that is, the entity repackages and resells the time as prepaid debit cards).
Resellers of telephone prepaid debit cards who do not engage in any of the activities described in subdivision (a) are not subject to the registration requirement imposed by subdivision (a). Resellers that are not subject to the registration requirement imposed by subdivision (a) include both of the following:
Retailers who only provide a marketing venue for telephone prepaid debit cards.
Entities that only print information on telephone prepaid debit cards.
Telephone prepaid debit cards offered in a promotional manner or gratis shall not subject the provider to the registration requirement imposed by subdivision (a), unless the cards are issued in conjunction with the sale of related goods or services.
The commission shall maintain a list of certificated interexchange carriers and shall supply that information upon request.
Entities that are required to register, but have failed to do so, or entities that are denied registration by the commission, shall not offer the services of telephone prepaid debit cards. Entities that are required to register, but have failed to do so, and entities denied registration that offer telephone prepaid debit cards shall be subject to fines or other sanctions that may be ordered by the commission.
The commission may enforce the standards and requirements of Section 17538.9 of the Business and Professions Code.
ARTICLE 10. Natural Gas Surcharge [890. - 900.]
On and after January 1, 2001, there shall be imposed a surcharge on all natural gas consumed in this state. The commission shall establish a surcharge to fund low-income assistance programs required by Sections 739.1, 739.2, and 2790 and cost-effective energy efficiency and conservation activities and public interest research and development authorized by Section 740 and not adequately provided by the competitive and regulated markets. Upon implementation of this article, funding for those programs shall be removed from the rates of gas utilities.
A public utility gas corporation is relieved from liability to collect the surcharge insofar as the base upon which the surcharge is imposed is represented by accounts which have been found to be worthless and charged off in accordance with generally accepted accounting principles. If the public utility gas corporation has previously paid the amount of the surcharge it may, under regulations prescribed by the State Board of Equalization, take as a deduction on its return the amount found to be worthless and charged off. If any accounts are thereafter collected in whole or in part, the surcharge so collected shall be paid with the first return filed after that collection. The commission may by regulation promulgate other rules with respect to uncollected or worthless accounts as it determines to be necessary to the fair and efficient administration of this part.
The commission shall annually determine the amount of money required for the following year to administer this chapter and fund the natural gas related programs described in subdivision (a) for the service territory of each public utility gas corporation.
The commission shall annually establish a surcharge rate for each class of customer for the service territory of each public utility gas corporation. A customer of an interstate gas pipeline, as defined in Section 891, shall pay the same surcharge rate as the customer would pay if the customer received service from the public utility gas corporation in whose service territory the customer is located. The commission shall determine the total volume of retail natural gas transported within the service territory of a utility gas provider, that is not subject to exemption pursuant to Section 896, for the purpose of establishing the surcharge rate.
The commission shall allocate the surcharge for gas used by all customers, including those customers who were not subject to the surcharge prior to January 1, 2001.
The commission shall notify the State Board of Equalization of the surcharge rate for each class of customer served by an interstate pipeline in the service territory of a public utility gas corporation.
The State Board of Equalization shall notify each person who consumes natural gas delivered by an interstate pipeline of the surcharge rate for each class of customer within the service territory of a public utility gas corporation.
The surcharge imposed pursuant to subdivision (a) shall be in addition to any other charges for natural gas sold or transported for consumption in this state. Effective on July 1, 2001, the surcharge imposed pursuant to this article shall be identified as a separate line item on the bill of a customer of a public utility gas corporation.
Notwithstanding subdivision (a), public utility gas corporations shall continue to collect in rates those costs of programs described in subdivision (a) of Section 890 that are uncollected prior to the operative date of this article.
“Gas utility” means any public utility gas corporation or interstate pipeline as defined in this section.
“Public utility gas corporation” means a public utility gas corporation as defined in Section 216.
“Interstate pipeline” means any entity that owns or operates a natural gas pipeline delivering natural gas to consumers in the state and is subject to rate regulation by the Federal Energy Regulatory Commission.
Each gas utility shall notify the State Board of Equalization of its status under this section. Each person who consumes natural gas delivered by an interstate pipeline shall annually register with the State Board of Equalization. The State Board of Equalization may require any documentation that it determines to be necessary to implement this article.
The revenue from the surcharge imposed pursuant to this article and collected by a public utility gas corporation shall be paid to the State Board of Equalization in the form of remittances. Persons consuming natural gas delivered by an interstate pipeline shall pay the surcharge to the State Board of Equalization in the form of remittances. The board shall transmit the payments to the Treasurer who shall deposit the payments in the Gas Consumption Surcharge Fund, which is hereby created in the State Treasury.
The surcharges imposed by this part and the amounts thereof required to be collected by public utility gas corporations are due quarterly on or before the last day of the month next succeeding each calendar quarter.
On or before the last day of the month following each calendar quarter, a return for the preceding quarterly period shall be filed with the State Board of Equalization in such form as the board may prescribe. A return shall be filed by every public utility gas corporation, and by every person consuming, as defined in this article, natural gas transported by a provider other than the public utility gas corporation. The return shall be signed by the person required to file the return or by his or her duly authorized agent.
The State Board of Equalization shall administer the surcharge imposed pursuant to this article in accordance with the Fee Collection Procedures Law (Part 30 (commencing with Section 55001) of Division 2 of the Revenue and Taxation Code.
The State Board of Equalization may collect any unpaid surcharge imposed pursuant to this article.
Notwithstanding Section 13340 of the Government Code, moneys in the Gas Consumption Surcharge Fund are continuously appropriated, without regard to fiscal years, as follows:
To the commission or an entity designated by the commission to fund programs described in subdivision (a) of Section 890. If the commission designates the Energy Commission to receive funds for public interest research and development, both of the following shall apply:
The Controller shall transfer the funds to a separate subaccount within the Public Interest Research, Development, and Demonstration Fund. Notwithstanding Section 384 of this code and Section 13340 of the Government Code, moneys in the subaccount are continuously appropriated, without regard to fiscal year, to pay the Energy Commission for its costs in carrying out its duties and responsibilities under this article.
The Energy Commission may administer the program pursuant to Chapter 7.1 (commencing with Section 25620) of Division 15 of the Public Resources Code.
To pay the commission for its costs in carrying out its duties and responsibilities under this article.
To pay the State Board of Equalization for its costs in administering this article.
“Consumption” means the use or employment of natural gas. Consumption does not include the use or employment of natural gas to generate power for sale, the sale or purchase of natural gas for resale to end users, the sale or use of gas for enhanced oil recovery, natural gas utilized in cogeneration technology projects to produce electricity, or natural gas that is produced in California and transported on a proprietary pipeline. Consumption does not include the consumption of natural gas which this state is prohibited from taxing under the United States Constitution or the California Constitution.
Nothing in this article impairs the rights and obligations of parties to contracts approved by the commission, as the rights and obligations were interpreted as of January 1, 1998.
Notwithstanding Section 890, a municipality, district, or public agency that offers in published tariffs home weatherization services, rate assistance for low-income customers, or programs similar to those described in subdivision (a) of Section 890, shall not be required to collect a surcharge pursuant to this article from customers within its service territory. A municipality, district, or public agency shall be required to collect a surcharge pursuant to this article from customers served by the municipality, district, or public agency outside of its service territory unless the commission determines that the entity offers those customers services similar to those offered by gas utilities as described in subdivision (a) of Section 890.
The commission shall determine the most efficient and cost-effective way to provide programs pursuant to Sections 739.1, 739.2, and 2790 in a consistent manner statewide by utility provider service territory. In determining the most cost-effective way to provide service that benefits persons eligible for low-income programs, the commission shall consider factors, including, but not limited to, outreach efforts to reach the targeted population and the types of discounts and services that should be provided by each utility. On or before July 1, 2001, the commission shall develop and implement efficient and cost-effective programs pursuant to Sections 739.1, 739.2, and 2790. The commission may conduct compliance audits to ensure compliance with any commission order or resolution relating to the implementation of programs pursuant to Sections 739.1, 739.2, and 2790, and may conduct financial audits.
ARTICLE 11. Reports to the Legislature [910. - 920.]
The commission shall develop, publish, and annually update a report that contains all of the following information:
A workplan that describes in clear detail the scheduled proceedings and other decisions that may be considered by the commission during the calendar year.
Performance criteria for the commission and the executive director, and an evaluation of the performance of the executive director during the previous year based on criteria established in the prior year’s workplan.
An accounting of the commission’s transactions and proceedings from the prior year, together with other facts, suggestions, and recommendations that the commission deems of value to the people of the state. The accounting shall include the activities that the commission has taken, and plans to take, to reduce the costs of, and the rates for, water and energy, including electricity, to improve the competitiveness of the state’s industries, including agriculture, and, to the extent possible, shall include suggestions and recommendations for the reduction of those costs and rates.
A description of activities taken and processes instituted to both solicit the input of customers from diverse regions of the state in ratesetting and quasi-legislative proceedings and to process that input in a way that makes it usable in commission decisionmaking. The report shall describe the successes and challenges of these processes, the effect of resource constraints, and efforts to be made during the calendar year to further the goal of increased public participation.
A list of the public meetings held outside San Francisco in the previous year, and a schedule of meetings anticipated to be held outside San Francisco during the coming year.
A description of the actions taken by the commission using the information provided to it pursuant to Section 53122 of the Government Code, a summary of deenergization event trends and the effect of deenergization events on telecommunications service and public safety, and an analysis of how the impacts of deenergization events on telecommunications service could be mitigated.
A description of the audits and inspections conducted to ensure compliance with the commission’s backup electricity rules for providers of telecommunications service, including, but not limited to, the total number of violations identified by the commission in the prior year, aggregated by company, and a summary of enforcement actions taken for those violations.
The commission shall submit the report required pursuant to subdivision (a) to the Governor and the Legislature, in compliance with Section 9795 of the Government Code, no later than February 1 of each year.
The commission shall post the report in a conspicuous area of its internet website and shall have a program to disseminate the information in the report using computer mailing lists to provide regular updates on the information to those members of the public and organizations that request that information.
The commission shall annually submit a report to the Legislature on the commission’s timeliness in resolving cases, information on the disposition of applications for rehearings, and the days that commissioners presided in and attended hearings. The report shall include the number of scoping memos issued in each proceeding and the number of orders issued extending the statutory deadlines pursuant to subdivision (e) of Section 1701.2, for all adjudication cases, and pursuant to subdivision (a) of Section 1701.5, for all ratesetting or quasi-legislative cases.
For reporting on commissioner attendance at hearings, the report shall include reporting based on attendance at all types of hearings, including by all of the following:
Hearing type, including, but not limited to, prehearing conferences, evidentiary hearings, public participation hearings, and workshops.
Proceeding type, including quasi-legislative, an adjudication, a rate-setting, or a catastrophic wildfire proceeding.
Industry type, including electric, gas, water, telecommunications, or transportation.
The commission shall report to the Legislature the collections from each class of utility and expenditures, both direct and indirect, for regulatory and other authorized commission activities affecting each class. Where expenditures are for overhead, allocations of services common to several classes, or for commission-wide activities, the methods used to calculate the expenditures attributed to the class shall be described in reasonable detail.
The report shall be furnished to the Legislature within 60 days after the end of the fiscal year, and shall be subject to audit. The commission shall maintain information and reports necessary to perform an audit pursuant to this section.
The commission shall provide a report to the Legislature on September 1 of each year, on the progress of activities undertaken by each electrical corporation, gas corporation, water corporation, wireless telecommunications service provider, electric service provider, and telephone corporation with gross annual California revenues exceeding twenty-five million dollars ($25,000,000), by each community choice aggregator with gross annual revenues exceeding fifteen million dollars ($15,000,000), and by each electrical corporation, gas corporation, water corporation, wireless telecommunications service provider, electric service provider, and telephone corporation with gross annual California revenues exceeding fifteen million dollars ($15,000,000), but not more than twenty-five million dollars ($25,000,000), in the implementation of women, minority, disabled veteran, and LGBT business enterprise development programs pursuant to Article 5 (commencing with Section 8281) of Chapter 7 of Division 4. The report shall include information about which procurements are made with women, minority, disabled veteran, and LGBT business enterprises with at least a majority of the enterprise’s workforce in California, to the extent that information is readily accessible. The commission shall recommend a program for carrying out the policy declared in Article 5 (commencing with Section 8281) of Chapter 7 of Division 4, together with recommendations for legislation that it deems necessary or desirable to further that policy. The commission shall make the report available on its internet website.
As part of the annual report, the commission may include an analysis of the information described in subdivision (b) of Section 8284 to gauge the efficacy of the programs established pursuant to Article 5 (commencing with Section 8281) of Chapter 7 of Division 4 in attracting business for contractors and subcontractors operating in California.
If the commission includes the analysis described in subparagraph (A), the commission shall also, as part of that annual report, analyze the information provided to the commission pursuant to subdivision (a) of Section 8290.2.
In regard to disabled veteran business enterprises, the commission shall ensure that the programs and legislation recommended pursuant to subdivision (a) are consistent with the disabled veteran business enterprise certification eligibility requirements imposed by the Department of General Services and that the recommendations include only those disabled veteran business enterprises certified by the Department of General Services.
By February 1 of each year, the commission shall report to the Joint Legislative Budget Committee and appropriate fiscal and policy committees of the Legislature, on all sources and amounts of funding and actual and proposed expenditures, both in the two prior fiscal years and for the proposed fiscal year, including any costs to ratepayers, related to all of the following:
Entities or programs established by the commission by order, decision, motion, settlement, or other action, including, but not limited to, the California Clean Energy Fund, the California Emerging Technology Fund, and the Pacific Forest and Watershed Lands Stewardship Council. The report shall contain descriptions of relevant issues, including, but not limited to, all of the following:
Any governance structure established for an entity or program.
Any staff or employees hired by or for the entity or program and their salaries and expenses.
Any staff or employees transferred or loaned internally or interdepartmentally for the entity or program and their salaries and expenses.
Any contracts entered into by the entity or program, the funding sources for those contracts, and the legislative authority under which the commission entered into the contract.
The public process and oversight governing the entity or program’s activities.
Entities or programs established by the commission, other than those expressly authorized by statute, under the following sections:
Section 379.6.
Section 399.8.
Section 739.1.
Section 2790.
Section 2851.
Section 921.1.
Section 922.
Upon an entity ceasing operations, or a program ending, because its activities, including receiving revenue or making expenditures, have concluded, commission reporting on the entity or program pursuant to this section shall continue for the subsequent two fiscal years following the entity ceasing operations or the program ending. Following those subsequent two fiscal years, the commission shall note in the report submitted pursuant to this section which entity ceased operations or program ended, and the commission shall not be subject to any other reporting obligations related to the entity or program pursuant to this section.
The commission shall submit a report by April 1 of each year to the Legislature on residential and household gas and electric service disconnections that includes the following information for each community choice aggregator and each of the four electrical and gas corporations that have the greatest number of customers:
For the most recent five years, the total annual number of residential disconnections for nonpayment, reconnections following disconnection for nonpayment, and disconnections for nonpayment that did not result in a reconnection within 30 days.
For the most recent five years, the total annual number of households disconnected for nonpayment, households reconnected following disconnection for nonpayment, and households not reconnected within 30 days of being disconnected for nonpayment. A household disconnected more than once in a calendar year shall be counted only once for purposes of this reporting requirement.
The commission shall disaggregate the information specified in subdivision (a) to provide that information for each of the following populations:
Customers enrolled in the California Alternate Rates for Energy or CARE program.
Customers enrolled in a Family Electric Rate Assistance program.
Customers receiving a medical baseline allowance.
Customers both enrolled in the CARE program and receiving a medical baseline allowance.
Customers receiving assistance or a benefit under the federal Low-Income Home Energy Assistance Program (LIHEAP) (42 U.S.C. Sec. 8621 et seq.).
Customers of a community choice aggregator who, after disconnection, are reconnected to service provided by an electrical corporation.
For each of the customer categories listed in subdivision (b), the commission shall further disaggregate the information for individual customers as follows:
For a corporation included in the report pursuant to subdivision (a) that provides both gas and electric service to customers, the commission shall provide the information separately.
The commission shall annually submit a report to the Legislature on the commission’s advocacy efforts to keep transmission rates low for ratepayers through its participation in Federal Energy Regulatory Commission rate cases and the Independent System Operator’s transmission planning processes. The report shall include all of the following:
The number of Federal Energy Regulatory Commission rate cases in which the commission participated.
The amount of ratepayer moneys saved through the commission’s participation in Federal Energy Regulatory Commission rate cases.
The nature of the commission’s participation in each rate case, including a description of each issue analyzed in the rate case, such as return on equity, taxes, depreciation, cost-of-service ratemaking, and assumptions for justifying project needs.
The commission shall annually provide the Legislature with an update on the status of its review of public utilities’ balancing accounts pursuant to Section 792.5. The commission shall provide this update as part of its annual report published pursuant to Section 910 or by posting it in a conspicuous area of its Internet Web site, or both.
On or before June 30, 2023, the Low-Income Oversight Board established pursuant to Section 382.1 shall submit a report to the Legislature regarding the opportunity and process for expanding the third-party administrator contract used for the Universal Lifeline Telephone Service (ULTS) program, or establishing a similar new contract, to include water, gas, and electric utility service for purposes of facilitating enrollment between low-income assistance programs, minimizing privacy and data sharing concerns, and expediting eligibility verification processes. The report shall include a recommendation for funding the expansion of the contract or establishment of a new contract.
Pursuant to Section 10231.5 of the Government Code, this section is repealed on January 1, 2027.
Beginning February 1, 2016, the commission shall annually publish a report that includes all investigations into gas or electric service safety incidents reported, pursuant to commission requirements, by any gas corporation or electrical corporation. The report shall succinctly describe each safety investigation concluded during the prior calendar year and each investigation that remains open. The categories within the description shall include the month of the safety incident, the reason for the investigation, the facility type involved, and the owner of the facility.
The commission shall include in its report required pursuant to Section 910, a summary of the staff safety investigations concluded during the prior calendar year and the staff safety investigations that remain open for any gas corporation or electrical corporation, with a link to the Internet Web site with the report that contains the information required pursuant to subdivision (a).
An action taken by the commission on a safety recommendation letter or advisory bulletin concerning gas pipeline safety issued by the federal National Transportation Safety Board (NTSB) shall be reported annually, in detail, to the Legislature with the report required by Section 910. Correspondence from the NTSB that indicates that a recommendation of the NTSB has been closed following an action that the NTSB finds unacceptable shall be noted in the report required by Section 910.
The commission shall report the findings of any risk assessment required by Section 1103 to the Legislature.
The Public Utilities Commission shall conduct an audit of the expenditures of the funds received pursuant to Chapter 6 (commencing with Section 5001) of Division 2 each fiscal year. The results of this audit shall be reported in writing, on or before February 15th of each year thereafter, with respect to the audit for the fiscal year ending on the previous June 30th, to the appropriate policy and budget committees of the respective houses of the Legislature.
On or before April 1, 2023, and biennially thereafter, the commission shall conduct a fiscal and performance audit of the implementation and effectiveness of the California Advanced Services Fund to ensure that funds have been expended in accordance with the approved terms of the grant awards and loan agreements pursuant to Section 281 or 281.2 and shall report its findings to the Legislature. The reports shall include an update to the maps in the final report of the California Broadband Task Force and data on the types and numbers of jobs created as a result of the program administered by the commission pursuant to Section 281 or 281.2 and shall include information specified in Section 914.7.
Immediately upon completion of an audit of any entity or program created by any order, decision, motion, settlement, or other action by the commission conducted pursuant to Section 314.6, the commission shall transmit a copy of the audit report to the Legislature, including to the appropriate policy and fiscal committees or subcommittees of the Legislature, and to the Governor. The audit report shall be submitted to the Legislature in compliance with Section 9795 of the Government Code.
The reporting requirements of this section apply to electrical corporations with at least 1,000,000 retail customers in California and gas corporations with at least 500,000 retail customers in California.
The commission shall prepare a written report on the costs of programs and activities conducted by each electrical corporation and gas corporation that is subject to this section, including activities conducted to comply with their duty to serve. The report shall be completed on an annual basis before April 1 of each year, and shall identify, clearly and concisely, all of the following:
Each program mandated by statute and its annual cost to ratepayers.
Each program mandated by the commission and its annual cost to ratepayers.
Energy purchase contract costs and bond-related costs incurred pursuant to Division 27 (commencing with Section 80000) of the Water Code.
All other aggregated categories of costs currently recovered in retail rates as determined by the commission.
The report required by subdivision (b) shall be submitted to the Governor and the Legislature no later than April 1 of each year.
The commission shall post the report required by subdivision (b) in a conspicuous area of its Internet Web site.
The commission, by May 1, 2010, and by each May 1 thereafter, shall prepare and submit a written report, separate from and in addition to the report required by Section 913, to the Governor and Legislature that contains all of the following:
The commission’s recommendations for actions that can be undertaken during the succeeding 12 months to limit electrical corporations’ and gas corporations’ utility costs and rate increases.
The commission’s recommendations that may take longer than 12 months to implement, but could lead to substantial reductions in monthly electricity and natural gas utility bills.
Considerations of how the adoption of decarbonization policies, including electrification, may impact the total energy costs borne by consumers, including electricity, natural gas, and fuel for transportation, consistent with the state’s energy and environmental goals, including goals for reducing emissions of greenhouse gases.
In preparing the report required by subdivision (a), the commission shall require electrical corporations with 1,000,000 or more retail customers in California, and gas corporations with 500,000 or more retail customers in California, to study and report on measures the corporation recommends be undertaken to limit costs and rate increases.
The commission shall post the report required by subdivision (a) in a conspicuous area of its internet website.
The amount of ratebase for the transmission assets, distribution assets, and generation assets for the large electrical corporation with 10 years of historical values.
The total amount for return on equity and return on debt, reported separately, collected in the revenue requirement for the transmission assets, distribution assets, and generation assets for the large electrical corporation.
The total amount of federal, state, and local taxes associated with the return on equity collected in the revenue requirements for the transmission, distribution, and generation assets for the large electrical corporation.
The portion of the annual revenue requirement associated with the return on equity, total return on ratebase, and the associated federal, state, and local taxes associated with the return on equity of the large electrical corporation.
The actual mix of equity and debt capital in the large electrical corporation’s capital structure compared to the mix of equity and debt capital authorized by the commission.
Notwithstanding subdivision (g) of Section 454.5 and Section 583, no later than May 1 of each year, the commission shall release to the Legislature for the preceding calendar year the costs of all electricity procurement contracts for eligible renewable energy resources, including unbundled renewable energy credits, and all costs for utility-owned generation approved by the commission.
For power purchase contracts, the commission shall release costs in an aggregated form categorized according to the year the procurement transaction was approved by the commission, the eligible renewable energy resource type, including bundled renewable energy credits, the average executed contract price, and average actual recorded costs for each kilowatthour of production. Within each renewable energy resource type, the commission shall provide aggregated costs for different project size thresholds.
For each utility-owned renewable generation project, the commission shall release the costs forecast by the electrical corporation at the time of initial approval and the actual recorded costs for each kilowatthour of production during the preceding calendar year.
The commission shall report all electrical corporation revenue requirement increases associated with meeting the renewables portfolio standard, as defined in Section 399.12, including direct procurement costs for eligible renewable energy resources and renewable energy credits.
The commission shall report all cost savings experienced, or costs avoided, by electrical corporations as a result of meeting the renewables portfolio standard.
This section does not require the release of the terms of any individual electricity procurement contracts for eligible renewable energy resources, including unbundled renewable energy credits, approved by the commission. The commission shall aggregate data to the extent required to ensure protection of the confidentiality of individual contract costs even if this aggregation requires grouping contracts of different energy resource type. The commission shall not be required to release the data in any year when there are fewer than three contracts approved.
In order to evaluate the progress of the state’s electrical corporations in complying with the California Renewables Portfolio Standard Program (Article 16 (commencing with Section 399.11) of Chapter 2.3), the commission shall report to the Legislature no later than November 1 of each year on all of the following:
The progress and status of procurement activities by each retail seller pursuant to the California Renewables Portfolio Standard Program.
For each electrical corporation, an implementation schedule to achieve the renewables portfolio standard procurement requirements, including all substantive actions that have been taken or will be taken to achieve the program procurement requirements.
The projected ability of each electrical corporation to meet the renewables portfolio standard procurement requirements under the cost limitations in subdivisions (c) and (d) of Section 399.15 and any recommendations for revisions of those cost limitations.
Any renewable energy procurement plan approved by the commission pursuant to Section 399.13, and a schedule and status report for all substantive procurement, transmission development, and other activities that the commission has approved to be undertaken by an electrical corporation to achieve the procurement requirements of the renewables portfolio standard.
Any barriers to, and policy recommendations for, achieving the renewables portfolio standard pursuant to the California Renewables Portfolio Standard Program.
The efforts each electrical corporation is taking to recruit and train employees to ensure an adequately trained and available workforce, including the number of new employees hired by the electrical corporation for purposes of implementing the requirements of the California Renewables Portfolio Standard Program, the goals adopted by the electrical corporation for increasing women, minority, and disabled veterans trained or hired for purposes of implementing the requirements of that program, and, to the extent information is available, the number of new employees hired and the number of women, minority, and disabled veterans trained or hired by persons or corporations owning or operating eligible renewable energy resources under contract with an electrical corporation. This subdivision does not provide the commission with authority to engage in or regulate, or expand its authority to include, workforce recruitment or training.
A systemwide assessment of delays to interconnection or transmission approvals for eligible renewable energy resources or energy storage resources, based on the annual reports submitted to the commission by electrical corporations pursuant to Section 399.13.
Before July 1, 2022, and every three years thereafter, the commission shall submit a report to the Legislature on the demand-side management programs it oversees or that are paid for by ratepayers of community choice aggregators, electrical corporations, or gas corporations, including, but not limited to, energy efficiency and demand response programs.
The report shall include a list of all demand-side management programs, inclusive of codes and standards programs, with evaluations for each program that include, but are not limited to, all of the following:
Program description and target population.
Authorized budgets and actual expenditures.
Projected and actual energy savings over the program cycle.
Projected and actual bill savings to the average participating and the average nonparticipating ratepayer.
Cost-effectiveness analysis, including a total resource cost test and a program administrator cost test.
Public interest impacts, as applicable.
Actual customers served, aggregated by customer class, geographic distribution, and income level.
Peak demand reduction, as applicable.
Total system benefits, as adopted in the commission’s Decision 21-09-037 (September 23, 2021) Decision Adopting Energy Efficiency Goals for 2022-2032.
The commission may provide evaluations at a portfolio level in addition to the individual program evaluation required pursuant to paragraph (2).
In the report submitted pursuant to subdivision (a), the commission shall also report to the Legislature on the progress toward achieving the targets established pursuant to subdivision (a) of Section 454.55 and subdivision (a) of Section 454.56. The commission shall include specific strategies for, and an update on, progress toward maximizing the contribution of energy and electricity efficiency bill savings in disadvantaged communities identified pursuant to Section 39711 of the Health and Safety Code.
On or before February 1, 2023, and biennially thereafter, the commission, in consultation with the Independent System Operator and the Energy Commission, shall report to the Legislature and the Governor on the progress made toward modernizing the state’s distribution and transmission grid and the impacts of distributed energy resources on the state’s distribution and transmission grid and ratepayers. The report shall evaluate all of the following:
Reliability and transmission issues related to connecting distributed energy resources to the local distribution networks and regional grid.
Issues related to grid reliability and operation, including interconnection, and the position of federal and state regulators toward distributed energy resource accessibility.
The effect on overall grid operation of various distributed energy resources.
Barriers affecting the connection of distributed energy resources to the state’s grid.
Emerging technologies related to distributed energy resource interconnection and operation.
Interconnection issues that may arise for the Independent System Operator and local distribution companies.
The effect on peak demand for electricity.
The potential for distributed energy resources to benefit the state’s distribution and transmission grid.
In addition, the commission shall specifically assess the impacts of the California Solar Initiative program, specified in Section 25781 of the Public Resources Code and Section 2851, the self-generation incentive program authorized by Section 379.6, and the net energy metering program specified in Sections 2827 and 2827.1.
On or before July 30, 2020, and by July 30 of every third year thereafter through 2029, the commission shall submit to the Legislature an assessment of the Multifamily Affordable Housing Solar Roofs Program (Chapter 9.5 (commencing with Section 2870) of Part 2). That assessment shall include the number of qualified multifamily affordable housing property sites that have a qualifying solar energy system for which an award was made pursuant to that program and, for each, the dollar value of the award and the electrical generating capacity of the qualifying renewable energy system, the bill reduction outcomes of the program for the participants, the cost of the program, the total electrical system benefits, the environmental benefits, the progress made toward reaching the goals of the program, the program’s impact on the California Alternate Rates for Energy (CARE) program budget, and the recommendations for improving the program to meet its goals. The report shall include an analysis of pending program commitments, reservations, obligations, and projected demands for the program to determine whether future ongoing funding allocations for the program are substantiated. The report shall also include a summary of the other programs intended to benefit disadvantaged communities, including, but not limited to, the Single-Family Affordable Solar Homes Program established by the commission in Decision 07-11-045, the Multifamily Affordable Solar Housing Program established by the commission in Decision 08-10-036, and the Green Tariff Shared Renewables Program (Chapter 7.6 (commencing with Section 2831) of Part 2).
On or before December 31, 2018, and biennially thereafter, the commission shall, in its annual report prepared pursuant to Section 913, identify and report to the Legislature on electrical and gas corporation ratepayer-funded energy efficiency programs that are similar to programs administered by the Energy Commission, the State Air Resources Board, and the California Alternative Energy and Advanced Transportation Financing Authority, and on those programs revised pursuant to Section 381.4.
On or before July 1, 2025, the commission, in consultation with the Energy Commission, the California Infrastructure and Economic Development Bank, and the Independent System Operator, shall submit to the Governor and the Legislature a study, including findings and recommendations, identifying proposals to reduce the cost to ratepayers of expanding the state’s electrical transmission grid as necessary to achieve the state’s goals, to meet the state’s requirements, and to reduce the emissions of greenhouse gases, as specified in statute, regulation, or executive order.
In conducting the study, the commission shall evaluate, at minimum, all of the following:
Public financing of transmission projects, including approaches to lower the cost of financing, and the use of nonratepayer funds to pay, a portion of the costs of transmission projects necessary to achieve relevant public policy goals. The study shall identify nonratepayer funding sources that may be suitable for this purpose.
The costs and benefits of different ownership models, lease agreements, or other public-private arrangements necessary to build the transmission projects using public financing.
Other proposals identified by the commission or other consulted parties that, in the judgment of the commission, could accelerate the development of, and reduce the cost to ratepayers of expanding, the state’s electrical transmission grid.
Estimated cost savings of each option.
Thresholds or criteria for transmission projects to be considered eligible for public financing, including, but not limited to, project size, cost, location, or achievement of statewide policy.
Appropriate cost limitations and protections in exercising public financing for this purpose.
Relevant local, state, and federal statute applicable to public financing of transmission infrastructure.
In conducting the study, the commission shall provide opportunities for public input on which proposals to consider and on draft findings and recommendations.
Pursuant to Section 10231.5 of the Government Code, this section is repealed on January 1, 2030.
Notwithstanding Section 10231.5 of the Government Code, the commission, Energy Commission, and State Air Resources Board shall, in consultation with all California balancing authorities, as defined in subdivision (d) of Section 399.12, as part of a public process, issue a joint report to the Legislature by January 1, 2021, and at least every four years thereafter.
The joint report shall include all of the following:
A review of the policy described in subdivision (a) of Section 454.53, focused on technologies, forecasts, then-existing transmission, and maintaining safety, environmental and public safety protection, affordability, and system and local reliability.
An evaluation identifying the potential benefits and impacts on system and local reliability associated with achieving the policy described in subdivision (a) of Section 454.53.
An evaluation identifying the nature of any anticipated financial costs and benefits to electrical, gas, and water utilities, including customer rate impacts and benefits.
The barriers to, and benefits of, achieving the policy described in subdivision (a) of Section 454.53.
Alternative scenarios in which the policy described in subdivision (a) of Section 454.53 can be achieved and the estimated costs and benefits of each scenario.
On or before December 1, 2024, and biennially thereafter, the commission, in consultation with California balancing authorities, as defined in Section 399.12, shall submit a report to the Legislature that includes all of the following:
A description of the electrical transmission project applications submitted to the commission for certificates of public convenience and necessity in the preceding two-year period.
The number of electrical transmission projects that were issued certificates of public convenience and necessity in the preceding two-year period.
The number of electrical transmission projects that, in the preceding two-year period, went into operation, were approved by the Independent System Operator, and did not require the issuance of certificates of public convenience and necessity.
The estimated transmission capital cost added to the rate base for each electrical transmission project that was, in the preceding two-year period, either approved by the Independent System Operator or issued a certificate of public convenience and necessity.
The commission shall annually publish on its internet website and submit to the Legislature a report that includes both of the following:
A report on the progress made to grow the use of distributed energy resources among residential customers in disadvantaged communities and in low-income households.
An aggregated list, by census tract and ZIP Code, of all renewable electrical generation facilities, as defined in Section 2827, that began to receive service pursuant to a net energy metering contract or tariff during the preceding calendar year, including, but not limited to, median household income, home ownership, and racial composition, as applicable.
For purposes of this section, both of the following definitions apply:
“Large electrical corporation” has the same meaning as defined in Section 3280.
“Significant voltage-related incident” means a deviation in electrical service voltage delivered by an electrical corporation to a customer that falls outside the standard electrical service voltage range of plus or minus 5 percent of nominal voltage and that results in damage to customer-owned equipment, appliances, or property.
On or before January 1, 2027, the commission shall require each large electrical corporation to commence a study to evaluate significant voltage-related incidents across its residential, commercial, and industrial customers that resulted in damage to customer-owned equipment, appliances, or property totaling five thousand dollars ($5,000) or more.
Each study shall, at a minimum, do all of the following:
Evaluate associated consumer protections within the service territory of the large electrical corporation.
Quantify the frequency and causes of significant voltage-related incidents that resulted in property damage, including, but not limited to, the number and geographic distribution of significant voltage-related incidents reported from January 1, 2024, to December 31, 2026, inclusive.
Identify the causes of significant voltage-related incidents, including electrical grid instability, system failures, or natural disasters such as wildfires and storms, reported from January 1, 2024, to December 31, 2026, inclusive.
Evaluate the impacts of, and damage caused by, significant voltage-related incidents on the large electrical corporation’s operations and service reliability and customer-owned equipment, appliances, or property, including, but not limited to, the frequency of high- and low-voltage changes by voltage class across different customer classes, including residential, commercial, and industrial customer classes.
Quantify the extent of reported property damage, including total monetary claims filed, approved, and denied, to different customer classes, including residential, commercial, and industrial customer classes, resulting from significant voltage-related incidents.
Evaluate any trends in customer complaints related to significant voltage-related incidents.
Examine response times and management and resolution of complaints or claims related to significant voltage-related incidents that resulted in damage to customer-owned equipment, appliances, or property.
Describe consumer protections from significant voltage-related incidents in the large electrical corporation’s service territory.
Evaluate the adequacy of the consumer protections related to reporting and public disclosure of significant voltage-related incidents that resulted in damage to customer-owned equipment, appliances, or property.
Identify current outreach and support related to significant voltage-related incidents, including, but not limited to, whether current practices adequately serve low-income, rural, and limited English proficiency customers seeking reimbursement for damage to customer-owned equipment, appliances, or property.
On or before July 1, 2027, the commission shall publish hyperlinks on its internet website to the studies conducted by the large electrical corporations, and report on the studies to the Legislature.
Pursuant to Section 10231.5 of the Government Code, this section is repealed on January 1, 2031.
Within 24 months of establishing a community renewable energy program pursuant to Section 769.3, if applicable, and annually thereafter for the duration of the program, the commission shall submit a report to the Legislature, in compliance with Section 9795 of the Government Code, on the facilities deployed and customers subscribed, pursuant to that program, including an analysis of low-income customer participation.
On or before March 31, 2024, the commission shall report to the Legislature on its actions taken pursuant to subdivision (b) of Section 769.3 and its justification for terminating, modifying, or retaining each customer renewable energy subscription program pursuant to that subdivision.
The requirement for submitting a report imposed under this subdivision is inoperative on January 1, 2028, pursuant to Section 10231.5 of the Government Code.
A report to be submitted pursuant to this subdivision shall be submitted in compliance with Section 9795 of the Government Code.
Notwithstanding Section 10231.5 of the Government Code, on or before December 1, 2023, and annually thereafter, the commission, Energy Commission, and State Air Resources Board, in consultation with California balancing authorities, as defined in subdivision (d) of Section 399.12, and as part of, or an interim addendum to, the quadrennial joint report required pursuant to Section 913.11, as applicable, shall issue a joint reliability progress report that reviews system and local reliability within the context of the policy described in subdivision (a) of Section 454.53, with a particular focus on summer reliability. The joint reliability progress report shall identify challenges and gaps, if any, to achieving system and local reliability and identify the amount and cause of any delays to achieving compliance with all energy and capacity procurement requirements set by the commission.
Notwithstanding Section 10231.5 of the Government Code, in coordination with the Energy Commission, the Independent System Operator, and the Department of Water Resources, the commission shall submit a report to the Legislature each year on the status of new resource additions and revisions to the state’s electric demand forecast, and the impact of these updates on the need for keeping the Diablo Canyon powerplant online.
The commission may assess the extent to which electrical corporation costs associated with new loads from data centers result in cost shifts to other electrical corporation customers. This assessment may include, but not be limited to, the following:
An analysis of potential electrical corporation costs associated with utility procurement to meet growing load demands from data centers’ increased energy consumption.
An analysis of potential electrical corporation costs associated with the installation of new transmission and distribution assets to serve new data centers or expansions of existing data centers, including the costs of stranded assets and assets installed for an entity that ceases operation.
Identification of opportunities to prevent or mitigate any substantial cost shifts, if the cost shifts are identified.
The commission shall submit an assessment completed pursuant to this section to the relevant policy committees of the Legislature and publicly post a copy of the assessment on the commission’s internet website on or before January 1, 2027.
Pursuant to Section 10231.5 of the Government Code, this section is repealed on January 1, 2031.
The commission shall annually report the information required to be reported by public utilities pursuant to Section 7912, to the Assembly Committee on Utilities and Commerce and the Senate Committee on Energy, Utilities and Communications, or their successor committees, and within a reasonable time thereafter, shall make the information available to the public on its Internet Web site.
The commission shall annually report to the Legislature, in a document that can be made public, information relative to the actions undertaken by the commission implementing the lifeline telecommunications universal service program pursuant to subdivision (a) of Section 873.
The commission, in its annual report prepared pursuant to Section 914.1, shall assess whether having telephone corporations provide the name and address of its lifeline customers to other public utilities for the purpose of low-income ratepayer assistance outreach efforts has been helpful in the low-income ratepayer assistance outreach efforts.
By December 31 of each year, the commission shall submit to the Governor and the Legislature a report that includes, based on yearend data, on an aggregated basis, the information submitted by holders pursuant to subdivision (b) of Section 5960. All information reported by the commission pursuant to this section shall be disclosed to the public only as provided for pursuant to Section 583. No individually identifiable customer or subscriber information shall be subject to public disclosure.
The commission shall annually report the information required to be reported by holders of state franchises pursuant to Section 5920, to the Assembly Committee on Utilities and Commerce and the Senate Committee on Energy, Utilities and Communications, or their successor committees, and within a reasonable time thereafter, shall make the information available to the public on its Internet Web site.
The commission shall report to the Legislature and the Governor annually on the effectiveness of the program administered pursuant to subdivision (c) of Section 280.5.
By April 1, 2019, and by April 1 of each year thereafter, the commission shall provide to the Legislature either a report or the biennial fiscal and performance audit conducted pursuant to Section 912.2 that includes all of the following information:
The remaining unserved areas in the state.
The amount of funds expended from the California Advanced Services Fund in the prior year.
The recipients of funds expended from the California Advanced Services Fund in the prior year.
The geographic regions of the state affected by funds expended from the California Advanced Services Fund in the prior year, including information by county.
The expected benefits to be derived from the funds expended from the California Advanced Services Fund in the prior year.
Details on the status of each project funded through the California Advanced Services Fund and whether the project has been completed or the expected completion date of the project.
Actual broadband adoption levels from funds expended from the California Advanced Services Fund in the prior year.
The cost per household for each project.
The number of formerly unserved households subscribing to broadband service in areas covered by projects funded by the California Advanced Services Fund.
The number of subscriptions resulting from the broadband adoption program funded by the California Advanced Services Fund.
An update on the expenditures from the California Advanced Services Fund, broadband adoption levels, the progress in achieving the goals of the program, and an accounting of the remaining unserved households in each region of the state as of December 31 of the immediately preceding year.
The amount of funds expended from the California Advanced Services Fund to match federal funds.
Additional details on efforts to leverage non-California Advanced Services Fund moneys.
The status of the California Advanced Services Fund balance and the projected amount to be collected in each year to fund approved projects.
On or before November 30 of each year, the commission shall report to the Legislature on its rail safety activities.
The commission shall annually report the results of its investigation pursuant to subdivision (d) of Section 7661 relative to any incident that results in a notification required pursuant to subdivision (b) of Section 7661, including its findings concerning the cause or causes of the incident and any action undertaken by the commission in response to those findings. The commission may include the information required to be reported pursuant to this section in its report to the Legislature pursuant to Section 916.
The commission shall annually report to the Legislature, on or before July 1, on sites on railroad lines in the state it finds to be hazardous. The report shall include, but not be limited to, information on all of the following:
A list of all railroad derailment accident sites in the state on which accidents have occurred within at least the previous five years. The list shall describe the nature and probable causes of the accidents, if known, and shall indicate whether the accidents occurred at or near sites that the commission has determined, pursuant to subdivision (b), pose a local safety hazard.
A list of all railroad sites in the state that the commission determines, pursuant to Section 20106 of Title 49 of the United States Code, pose a local safety hazard. The commission may submit in the annual report the list of railroad sites submitted in the immediate prior year annual report, and may amend or revise that list from the immediate prior year as necessary. Factors that the commission shall consider in determining a local safety hazard may include, but need not be limited to, all of the following:
The severity of grade and curve of track.
The value of special skills of train operators in negotiating the particular segment of railroad line.
The value of special railroad equipment in negotiating the particular segment of railroad line.
The types of commodities transported on or near the particular segment of railroad line.
The hazard posed by the release of the commodity into the environment.
The value of special railroad equipment in the process of safely loading, transporting, storing, or unloading potentially hazardous commodities.
The proximity of railroad activity to human activity or sensitive environmental areas.
A list of the root causes and significant contributing factors of all train accidents or derailments investigated.
In determining which railroad sites pose a local safety hazard pursuant to subdivision (b), the commission shall consider the history of accidents at or near the sites. The commission shall not limit its determination to sites at which accidents have already occurred, but shall identify potentially hazardous sites based on the criteria enumerated in subdivision (b) and all other criteria that the commission determines influence railroad safety. The commission shall also consider whether any local safety hazards at railroad sites have been eliminated or sufficiently remediated to warrant removal of the site from the list required under subdivision (b).
The commission may combine the information required to be reported by this section with the report prepared pursuant to Section 916.
The commission shall annually report to the Legislature on or before November 30 of each year on its compliance with the requirements of Section 765.5. The annual report shall include a determination by the commission of the impact on competition, if any, of the regulatory fees assessed railroad corporations and motor carriers for the support of the commission’s activities.
The commission may combine the information required by this section with the report prepared pursuant to Section 916.
An action taken by the commission on a safety recommendation letter or safety advisory pursuant to Section 765 shall be reported annually, in detail, to the Legislature with the report required by Section 910. Correspondence from the federal National Transportation Safety Board indicating that a recommendation has been closed following an action that the federal National Transportation Safety Board finds unacceptable shall be noted in the report required by Section 910.
By January 1 of each year, the commission shall submit to the Legislature a detailed budget for the expenditure of railroad corporation fees for the ensuing budget year, consistent with Section 421.
The commission shall, within 30 days prior to commencement of the regular session of the Legislature, submit to the Governor a full and true report of transactions under Chapter 6 (commencing with Section 5001) of Division 2 during the preceding biennium, including a complete statement of receipts and expenditures during the period.
The commission and the Department of Insurance shall collaborate on a study of transportation network company insurance to assess whether coverage requirements are appropriate to the risk of transportation network company services in order to promote data-driven decisions on insurance requirements, and shall report the findings of this study to the Legislature no later than December 31, 2017.
The commission and the Department of Insurance shall collaborate on a study of the impacts of the requirements established for uninsured motorist coverage and underinsured motorist coverage under paragraph (2) of subdivision (b) of Section 5433 to assess whether those coverage requirements are appropriate to the risk of transportation network company services in order to promote data-driven decisions on insurance requirements, and shall report the findings of this study to the Assembly Committee on Insurance and the Senate Committee on Insurance on or before December 31, 2030.
Pursuant to Section 10231.5 of the Government Code, this section shall become inoperative on December 31, 2034, and, as of January 1, 2035, is repealed.
Unless expressly directed otherwise, a report to be submitted to the Legislature pursuant to this article is to be submitted in compliance with Section 9795 of the Government Code, except that an electronic copy may be submitted to the Secretary of the Senate, unless specifically requested to submit a printed copy of the report, with an electronic copy submitted to Legislative Counsel in compliance with subdivision (c) of Section 10242.5 of the Government Code.
Any report that is expressly directed to be submitted to a committee of the Legislature shall be submitted as an electronic copy, unless specifically requested to submit a printed copy by chair of that committee, with an electronic copy submitted to Legislative Counsel in compliance with subdivision (c) of Section 10242.5 of the Government Code.
Any report required to be submitted to the Governor pursuant to this article shall be submitted as an electronic copy unless specifically requested to submit a printed copy of the report by the Governor.
ARTICLE 12. Building Initiative for Low-Emissions Development (BUILD) Program [921. - 921.1.]
For purposes of this article, the following definitions apply:
“Disadvantaged community” means a community identified as a disadvantaged community pursuant to Section 39711 of the Health and Safety Code.
“Eligible applicants” means owners or developers of new residential housing.
“Low-income community” means a census tract or equivalent geographic area defined by the United States Census Bureau in which at least 50 percent of households have an income less than 60 percent of the area median gross income.
“Low-income residential housing” means either of the following:
A multifamily residential building of at least two rental housing units that is operated to provide deed-restricted low-income residential housing, as described in clause (i) of subparagraph (A) of paragraph (3) of subdivision (a) of Section 2852, and that meets one or both of the following conditions:
The property is located in a disadvantaged community or low-income community.
At least 80 percent of the households living in the building have incomes at or below 60 percent of the area median income, as defined in subdivision (f) of Section 50052.5 of the Health and Safety Code.
An individual low-income residence, as described in subparagraph (C) of paragraph (3) of subdivision (a) of Section 2852.
“Near-zero-emission building technology” means technology that reduces both of the following:
The energy demands of a building on the electrical or gas distribution system.
The direct and indirect emissions of greenhouse gases from buildings.
Near-zero-emission building technology includes a single technology, such as heat pumps, solar thermal systems, or advanced energy efficiency systems, and a combination of technologies, such as a solar photovoltaic system with an energy storage system.
“Program” means the Building Initiative for Low-Emissions Development (BUILD) Program.
The commission, in consultation with the Energy Commission, shall develop and supervise the administration of the Building Initiative for Low-Emissions Development (BUILD) Program to require gas corporations to provide incentives to eligible applicants for the deployment of near-zero-emission building technologies to significantly reduce the emissions of greenhouse gases from those buildings below the minimum projected emissions reductions that would otherwise be expected to result from the implementation of the prescriptive standards described in Section 150.1 of Subchapter 8 of Part 6 of Title 24 of the California Code of Regulations.
The commission may determine whether each gas corporation or a third party, including the Energy Commission, shall administer the program.
Moneys allocated pursuant to Section 748.6 shall be available to each gas corporation, or the third-party administrator, for allocation consistent with this section.
The amount of the incentive provided pursuant to the program shall take into account the availability of existing incentives and shall be based on the projected amount of reduction in the emissions of greenhouse gases resulting from the installation of the near-zero-emission building technology. The commission shall set the incentives to encourage building designs that reduce greenhouse gas emissions beyond industry practices and to offer greater incentives for larger projected greenhouse gas emissions reductions. Incentives for buildings that serve low-income residents may have different standards from those that serve other residents.
To encourage the adoption of near-zero-emission building technologies in new low-income residential housing located in disadvantaged communities or low-income communities, the program shall reserve a minimum of 30 percent of the amount allocated pursuant to Section 748.6 for new low-income residential housing.
If, following the implementation of the outreach plan pursuant to paragraph (5) of subdivision (d), the moneys reserved pursuant to paragraph (1) remain unspent two years after those moneys were reserved, the commission shall evaluate potential changes to the program to increase participation and may make those moneys, or a portion of those moneys, available for other purposes consistent with the program.
In supervising the administration of the program, the commission shall do all of the following:
Ensure that projects funded with moneys reserved pursuant to subdivision (c) do not result in higher utility bills for building occupants.
Develop program guidelines that include, at a minimum, a list of eligible technologies, a process for evaluating new technologies, criteria for scoring and selecting projects, and a process and set of metrics by which to evaluate and track the program’s results.
Program metrics shall include, at a minimum, the number of low-emission systems installed in each building type, projected utility bill savings, and the cost per metric ton of avoided greenhouse gas emissions.
Implement an outreach plan to encourage applications for projects funded with moneys reserved pursuant to subdivision (c).
Each gas corporation shall provide the commission with any information required by the commission to complete the report on the program required pursuant to Section 910.4.
ARTICLE 13. Technology and Equipment for Clean Heating (TECH) Initiative [922. - 922.]
The commission shall develop and supervise the administration of the Technology and Equipment for Clean Heating (TECH) Initiative, a statewide market development initiative, to require gas corporations to advance the state’s market for low-emission space and water heating equipment for new and existing residential buildings through upstream market development, consumer education, contractor and vendor training, and the provision of upstream and midstream incentives to install low-emission space and water heating equipment in existing and new buildings, with technologies identified pursuant to subdivision (b).
The commission may determine whether each gas corporation or a third party, including the Energy Commission, shall administer the TECH Initiative.
As a part of the TECH Initiative, the commission shall identify and target key low-emission space and water heating equipment technologies that are in an early stage of market development and would assist the state in achieving the state’s greenhouse gas emissions reduction goal for 2030 and other long-term greenhouse gas emissions reduction goals established by the Legislature. In identifying and targeting these technologies, the commission shall give consideration to technologies that have the greatest potential to reduce greenhouse gas emissions in California and that improve the health and safety of, and energy affordability for, low-income households.
In supervising the administration of the TECH Initiative, the commission, in coordination with the Energy Commission, shall develop guidelines and evaluation metrics, implement outreach strategies for hard-to-reach customers, and provide for job training and employment opportunities.
The guidelines shall include, at a minimum, a list of eligible technologies, a process for evaluating new technologies, and a process and set of metrics by which to evaluate and track the TECH Initiative’s results.
The metrics shall include, but are not limited to, the market share for eligible technologies, projected utility bill savings, and the cost per metric ton of avoided greenhouse gas emissions.
Moneys allocated pursuant to Section 748.6 shall be available to each gas corporation, or the third-party administrator, for allocation consistent with this section.
Each gas corporation shall provide the commission with any information required by the commission to complete the report on the TECH Initiative required pursuant to Section 910.4.
ARTICLE 14.5. Powering Up Californians [930. - 940.]
This act shall be known, and may be cited, as the Powering Up Californians Act.
For purposes of this article, the following definitions apply:
“Electrification” means any new, expanded, or change in use of electricity related to the policies described in Section 933, including, but not limited to, in the industrial, commercial, agricultural, housing, or transportation sectors.
“Energization” and “energize” mean connecting customers to the electrical distribution grid and establishing adequate electrical distribution capacity or upgrading electrical distribution or transmission capacity to provide electrical service for a new customer, or to provide upgraded electrical service to an existing customer. The determination of adequate electrical distribution capacity includes consideration of future load. “Energization” and “energize” do not include activities related to connecting electrical supply resources.
“Energization time period” means the elapsed time beginning when the electrical corporation receives a substantially complete energization project application and ending when the electric service is installed and energized.
The Legislature finds and declares all of the following:
It is the policy of the state to reach carbon neutrality no later than 2045 and to maintain net negative emissions of greenhouse gases after 2045. To meet these goals and federal, state, regional, and local air quality and decarbonization standards, plans, and regulations, projections from the commission and the Energy Commission show the need for a large increase in both the quantity of electricity used and the functions for which electricity will be used.
To meet these decarbonization goals and federal, state, regional, and local air quality and decarbonization standards, plans, and regulations, the state’s electrical distribution systems must be substantially upgraded, new customers must promptly connect to the electrical distribution system, and existing customers must have their service level promptly upgraded.
There are many reports of large housing developments that are unable to be promptly energized. California has an urgent need to increase its supply of housing, requiring both new electrical distribution capacity and the prompt energization of new housing.
There are many reports of individual customers who are unable to have their electrical service promptly upgraded or energized and charging stations for light-duty, medium-duty, and heavy-duty vehicles and off-road vehicles, vessels, trains, and equipment that are unable to be promptly energized. These delays may inhibit the state’s ability to meet its decarbonization goals and federal, state, regional, and local air quality and decarbonization standards, plans, and regulations.
To improve the speed at which energization and service upgrades are performed, each electrical corporation that distributes electricity must improve its advance planning, engineering, and construction of increased distribution and transmission system capacity.
Paragraph (1) of subdivision (s) of Section 712.8 requires the operator of the Diablo Canyon powerplant to submit annually to the commission for its review the amount of compensation earned under paragraph (5) of subdivision (f) of Section 712.8, how it was spent, and a plan for prioritizing the uses of the compensation the next year. Paragraph (1) of subdivision (s) of Section 712.8 also provides that to the extent that it is not needed for Diablo Canyon, that compensation shall be spent on critical public purpose priorities, one of which is accelerating customer and generator interconnections.
Electrifying transportation and buildings may put downward pressure on rates by spreading fixed costs over more kilowatthours of usage.
Delays in energization, including service upgrades, are costly both to the customers awaiting service and to other customers deprived of the downward pressure on rates.
To carry out the planning, engineering, and construction of electrical distribution systems needed to promptly serve customers, each electrical corporation that distributes electricity must recruit, train, and retain an adequately sized, qualified workforce.
The commission should establish target deadlines for utilities that distribute electricity to energize new customers and upgrade the service of existing customers.
The commission should establish reporting requirements requiring each electrical corporation that distributes electricity to report the extent to which it complied with the target deadlines and the reasons for its noncompliance.
Nothing in paragraph (6) of subdivision (a) changes the requirements of Section 712.8.
It is the policy of the state that each electrical corporation does all of the following:
Upgrade the state’s electrical distribution systems as needed and in time to achieve the state’s decarbonization goals and implement federal, state, regional, and local air quality and decarbonization standards, plans, and regulations.
Comply with its obligation to serve, as provided in Section 451, by conducting sufficient advance planning, engineering, and construction of increased distribution system capacity so that customers can be energized without substantial delay.
Promptly energize new customers, including by ensuring that new housing, new businesses, new electric equipment in buildings, and new charging for light-duty, medium-duty, and heavy-duty vehicles and off-road vehicles, vessels, trains, and equipment can be used without delay caused by a failure of the electrical corporation to implement energization projects.
Promptly upgrade service when needed by customers.
Recruit, train, and retain an adequately sized and qualified workforce to carry out the planning, engineering, and construction of electrical distribution systems needed to promptly serve customers seeking energization and service upgrades without sacrificing other necessary activities of the workforce.
The commission shall determine the criteria for timely service for electric customers to be energized. The criteria shall include, but are not limited to, all of the following:
Categories of timely electric service through energization, including, but not limited to, both of the following:
The timely start of service, and timely fulfillment of requests, for energization, including new service connections and increased load from existing service connections after a customer has submitted a request for new or increased electrical load.
Project types that justify unique or extended energization timelines. These may include, but are not limited to, projects requiring substantial upstream capacity upgrades or substation upgrades, unanticipated engineering or construction work, or projects requiring energization of significant, unanticipated new load.
Establishing annual reporting requirements, while leveraging existing reporting requirements for interconnections of generation and storage wherever possible, for the electrical corporations to report customer energization projects in order to evaluate the electrical corporations fulfillment of timely electric service.
At a minimum, the reporting requirements shall include all of the following:
The average, median, and standard deviation time between receiving an application for energizing the electrical service.
Explanations for energization time periods that exceed the target maximum for energization projects.
Constraints and obstacles to each type of energization, including funding limitations, qualified staffing availability, or equipment availability.
Any other information required by the commission.
Annually convening a public workshop for the electrical corporations to discuss their reports with interested parties and experts in customer energization, including representatives from local governments, and to examine existing workflows and potential improvements to planning, timelines, processes, and customer communication and education, and criteria for determining timely service of energization requests. The workshops shall inform the commission in its determination of the criteria for timely service of energization for electric customers, and any subsequent revisions to established criteria.
In order to demonstrate improvement in energization performance and the resolution of backlogs of customers waiting for electricity, each electrical corporation that energized less than 35 percent of customers with completed applications exceeding 12 months in duration by January 31, 2023, shall submit a report to the commission, on or before December 1, 2024, demonstrating that the electrical corporation has energized 80 percent of customers with applications deemed complete as of January 31, 2023, excluding applications withdrawn, canceled, or with customer-requested energization dates beyond December 1, 2024. The commission may conduct an analysis of current energization status and adjust these thresholds and deadlines.
If an electrical corporation fails to meet the performance metric in paragraph (1), the electrical corporation shall implement actions necessary to meet the performance metric and include a summary of these actions in the report submitted to the commission.
Reports submitted to the commission pursuant to paragraphs (1) and (2) shall meet all of the following requirements:
Be posted online to the commission’s and the electrical corporation’s internet websites.
Include the number of withdrawn applications and aggregated data on the reasons, if any, given by customers for withdrawal.
Include the number of canceled applications and aggregated data on the reasons for which the electrical corporation, or, if applicable, the customer, canceled the request.
Include the number of projects delayed due to factors outside the electrical corporation’s control and aggregated data by factors, including, but not limited to, supply shortages and local permitting delays.
The number of submitted requests for energization of new customer connections and upgraded service during the prior year.
The number of completed requests for energization of new customer connections and upgraded service during the prior year.
The number of pending and uncompleted requests for energization of new customer connections and upgraded service at the end of the prior year.
The number of days between requests for energization of new customer connections or upgraded service and final service delivery.
A summary of recorded spending on energization of customer connections and service upgrades compared to the amounts authorized for these activities for that year in the most recent general rate case.
Any other information requested by the commission to evaluate the status of energization of customer connections and service upgrades.
The commission may modify or adjust the requirements of this section for any electrical corporation with fewer than 100,000 service connections, as individual circumstances merit.
This section shall not apply to an electrical cooperative, as defined in Section 2776.
For purposes of this section, “energization” and “energize” mean connecting customers to the electrical distribution grid and establishing adequate electrical distribution capacity or upgrading electrical distribution or transmission capacity to provide electrical service for a new customer, or to provide upgraded electrical service to an existing customer. The determination of adequate electrical distribution capacity includes consideration of future load. “Energization” and “energize” do not include activities related to connecting electrical supply resources.
On or before September 30, 2024, the commission shall do both of the following:
Establish reasonable average and maximum target energization time periods. The targets shall ensure that work is completed in a manner that minimizes delay in meeting the date requested by the customer to the greatest extent possible and prioritizes work in a manner consistent with Sections 932 and 933. The targets may vary depending on the complexity and magnitude of the work required and uncertainties regarding the readiness of the customer project needing energization. The targets may also recognize any factors beyond the electrical corporation’s control.
Establish a procedure for customers to report energization delays to the commission.
If energization time periods exceed the commission’s target averages or if an electrical corporation has a substantial number of energization projects that exceed the commission’s target maximums, the electrical corporation shall include in its annual report a strategy for meeting the targets in the future. The commission may request modification of the electrical corporation’s strategy to ensure the electrical corporation meets targets promptly and consistent with the policies set forth in Section 933.
Each electrical corporation shall report anonymized or averaged data to the extent necessary to prevent identifying individual customers. The commission shall require all reports to be publicly available.
The commission shall require an electrical corporation to take remedial actions necessary to achieve the targets established pursuant to paragraph (1) of subdivision (a).
The commission shall periodically update the energization time periods established in paragraph (1) of subdivision (a) and the electrical corporation’s annual reporting requirements to reflect changed circumstances, new information, and experience.
The commission shall evaluate and report to the Legislature, in compliance with Section 9795 of the Government Code, on or before January 1, 2027, whether to require an electrical corporation to have an executive incentive compensation structure that includes incentive compensation based on meeting the targets adopted in paragraph (1) of subdivision (a) for all executive officers.
On or before January 1, 2027, the commission shall establish an enforcement policy for the targets adopted in paragraph (1) of subdivision (a) that include penalties for not complying with the remedial actions required pursuant to subdivision (d).
As part of each annual report, including any updates pursuant to subdivision (e) of Section 934, and in each general rate case application, each electrical corporation shall include a detailed analysis of its current qualified staffing level and future required qualified staffing level for each job classification needed to be consistent with the findings and achieve the policies and requirements of this article.
The commission shall require each electrical corporation to have adequate qualified staffing needed to be consistent with the findings and achieve the policies and requirements of this article.
For job classifications that have apprentice training requirements, the commission shall require each electrical corporation to maintain a pipeline of apprentices sufficient to meet future qualified staffing needs, subject to any limitations based on safe staffing ratios.
In addition to the requirements of Section 740.21, the commission shall require an electrical corporation to do both of the following:
Consider, in its annual distribution planning process, all of the following:
Federal, state, regional, and local air quality and decarbonization standards, plans, and regulations.
The transportation and building electrification policies of state law.
State agency, local agency, and local government plans and requirements related to housing, economic development, critical facilities, transportation, and building electrification.
Known load, and projections of load provided by the Energy Commission.
Projections of load that exceed forecasts provided by the Energy Commission.
Adopt and implement plans to satisfy the policies set forth in Section 933, to support achieving the requirements listed in subparagraphs (A) to (C), inclusive, of paragraph (1), and to meet the energization time periods established pursuant to paragraph (1) of subdivision (a) of Section 934, including any updates pursuant to subdivision (e) of Section 934.
For purposes of subparagraph (E) of paragraph (1) of subdivision (a), an electrical corporation may only use a projection of load that exceeds forecasts provided by the Energy Commission if the electrical corporation provides to the commission detailed information on how the forecasts are developed and what state or local policies or customer requests necessitated the alternative forecast.
The commission shall ensure that each electrical corporation has sufficient and timely recovery of costs to be consistent with the findings and achieve the policies and requirements of this article, including for energization projects.
If requested by the electrical corporation, the commission shall authorize, within 180 days of the request, the use of a ratemaking mechanism that does all of the following:
Authorizes the electrical corporation to track costs for energization projects placed in service after January 1, 2024, that exceed the costs included in the electrical corporation’s annual authorized revenue requirement for energization, as established in the electrical corporation’s general rate case or any other proceeding.
Requires the commission to establish an up-front annual cap on the amount that each electrical corporation can recover within the mechanism. Before establishing the cap, the commission shall review all information submitted by the electrical corporation pursuant to subdivision (c).
Requires the commission to authorize the recovery of costs tracked within the mechanism through an annual rate adjustment until it determines whether the costs are just and reasonable in the electrical corporation’s next general rate case. The commission shall require the electrical corporation to include in its next general rate case application a demonstration that the costs incurred were just and reasonable. Any costs that the commission finds were not just and reasonable shall be subject to refund.
Requires only costs associated with energization to be included in the mechanism and requires costs to be tracked using the same cost categories as used by the electrical corporation in its general rate case application.
Prevents the electrical corporation from recovering any costs through the mechanism in any year until its recorded spending for energization projects exceeds its annualized revenue requirements for energization projects as established in the electrical corporation’s general rate case.
An electrical corporation, as part of its request for a ratemaking mechanism pursuant to subdivision (b), shall include in its request all of the following:
The commission shall ensure that each electrical corporation improves upon energization planning, consistent with the requirements of Section 936, when requesting an authorized revenue requirement during the electrical corporation’s general rate case, in order to minimize the need for any ratemaking mechanism authorized pursuant to this section.
This section shall be repealed on January 1, 2027.
The commission shall require an electrical corporation that requests the use of a ratemaking mechanism, pursuant to Section 937, as a condition of authorizing the use of the mechanism, to satisfy all of the following requirements:
The electrical corporation shall agree to retain an independent third-party auditor, which shall be selected by the commission based on nonbinding recommendations from the electrical corporation, to review the electrical corporation’s business practices and procedures for energizing new customers and how the electrical corporation is planning for demand growth, including new customer energizations.
The electrical corporation shall not recover the costs of the third-party auditor from ratepayers.
The third-party auditor shall review all of the following:
The electrical corporation’s customer energization requests for the previous three years.
The electrical corporation’s projections of customer demand growth included in the electrical corporation’s distribution plan, including growth in new customers and growth in demand from existing customers.
The electrical corporation’s qualified staffing levels and future anticipated staffing needs to meet projections for customer demand growth, including the ability of the electrical corporation to sufficiently build its workforce.
Funding requested by the electrical corporation to support energization requests for the previous three years in the general rate case or any other proceeding, and the efficacy of those previous requests in meeting customer demand.
Commission authorized funding for the electrical corporation to support energization for the previous three years, future authorized funding, and authorized changes to the electrical corporation’s business practices or structures to improve its ability to respond to changing customer demand.
The electrical corporation’s performance in meeting energization time periods established by the commission pursuant to this article.
The electrical corporation’s performance in meeting its internally established energization time periods over the prior 10 years or longer, as necessary.
Any other metrics deemed relevant by the commission or third-party auditor to support a thorough evaluation of the electrical corporation’s energization performance, including to identify and correct past flaws and to identify future best practices.
The third-party auditor shall evaluate the electrical corporation’s current and future energization performance and make recommendations as to whether the electrical corporation is adequately meeting and anticipating customer demand, adequately training and retaining an adequate workforce, and is funded at sufficient levels to meet forecasted demand growth.
The third-party auditor shall report to the commission on a biannual basis. The reports of the auditor shall be posted on the commission’s internet website and reported to the appropriate policy committees of the Legislature.
The electrical corporation shall retain an independent third-party auditor as provided in paragraph (1) of subdivision (a) before the commission authorizes use of the ratemaking mechanism pursuant to Section 937. The work of the auditor described in paragraphs (3), (4), and (5) of subdivision (a) may occur after the electrical corporation requests authorization for the ratemaking mechanism but shall occur before July 1, 2028. The commission’s 180-day deadline for authorizing the mechanism provided in paragraph (b) of Section 937 shall not be affected by whether the auditor has completed the work described in paragraphs (3), (4), and (5) of subdivision (a).
This section shall become inoperative on July 1, 2028, and, as of January 1, 2029, is repealed.
The commission may modify or adjust the requirements of this article for any electrical corporation with fewer than 100,000 service connections, as individual circumstances merit.
This article shall not apply to an electrical cooperative, as defined in Section 2776.
The commission shall require each electrical corporation to retain an independent third-party auditor, which shall be selected by the commission based on nonbinding recommendations from the electrical corporation, to review the electrical corporation’s business practices and procedures for energizing new customers and how the electrical corporation is planning for demand growth, including new customer energizations.
The third-party auditor shall review all of the following:
The electrical corporation’s customer energization requests for the previous three years.
The electrical corporation’s projections of customer demand growth included in the electrical corporation’s distribution plan, including growth in new customers and growth in demand from existing customers.
The electrical corporation’s qualified staffing levels and future anticipated staffing needs to meet projections for customer demand growth, including the ability of the electrical corporation to sufficiently build its workforce.
Funding requested by the electrical corporation to support energization requests for the previous three years in the general rate case or any other proceeding, and the efficacy of those previous requests in meeting customer demand.
Commission authorized funding for the electrical corporation to support energization for the previous three years, future authorized funding, and authorized changes to the electrical corporation’s business practices or structures to improve its ability to respond to changing customer demand.
The electrical corporation’s performance in meeting the reasonable average and maximum target energization time periods pursuant Section 934.
Any other metrics deemed relevant by the commission or third-party auditor to support a thorough evaluation of the electrical corporation’s energization performance, including to identify and correct past flaws and to identify future best practices.
The third-party auditor shall evaluate the electrical corporation’s current and future energization performance and make recommendations as to whether the electrical corporation is adequately meeting and anticipating customer demand, adequately training and retaining an adequate workforce, and is funded at sufficient levels to meet forecasted demand growth.
The third-party auditor shall report to the commission on a biannual basis. The reports of the auditor shall be posted on the commission’s internet website and reported to the appropriate policy committees of the Legislature.
The commission may require an electrical corporation to take remedial actions necessary to address deficiencies identified in the report provided by the third-party auditor pursuant to subdivision (d), or to achieve the targets established pursuant to paragraph (1) of subdivision (a) of Section 934.
For purposes of this section, “energization” means connecting customers to the electrical distribution grid and establishing adequate electrical distribution capacity or upgrading electrical distribution or transmission capacity to provide electrical service for a new customer, or to provide upgraded electrical service to an existing customer. The determination of adequate electrical distribution capacity includes consideration of future load. “Energization” does not include activities related to connecting electrical supply resources.
This section shall remain in effect only until January 1, 2032, and as of that date is repealed.
CHAPTER 4.5. Gas Pipeline Safety [950. - 978.]
ARTICLE 1. General [950. - 950.5.]
For purposes of this chapter, the following terms have the following meanings:
“Commission-regulated gas pipeline facility” means an intrastate gas pipeline facility as defined in Section 60101 of Title 49 of the United States Code, that is subject to the safety regulatory authority of the commission to the extent authorized in the certification submitted by the commission and approved by the United States Secretary of Transportation pursuant to Section 60105 of Title 49 of the United States Code, including each of the following pipelines:
An intrastate distribution line, which is a pipeline that is not subject to the jurisdiction of the Federal Energy Regulatory Commission pursuant to Section 717(b) of Title 15 of the United States Code because it is used for the local distribution of natural gas.
An intrastate transmission line, which is a transmission pipeline that the commission, pursuant to Section 717(c) of Title 15 of the United States Code, has certified to the Federal Energy Regulatory Commission as being subject to the regulatory jurisdiction of the commission over rates and service. For these purposes, a transmission pipeline means a pipeline other than a gathering line that: (A) transports gas from a gathering line or storage facility to a distribution center, storage facility, or large volume customer that is not downstream from a distribution center, (B) operates at a hoop stress of 20 percent or more of specified minimum yield strength, or (C) transports gas within a storage field.
An intrastate gathering line, which is a pipeline that transports gas from a current production facility to a transmission line or main.
A mobilehome park master-metered natural gas distribution system that is subject to the commission’s safety inspection and enforcement program pursuant to Chapter 4 (commencing with Section 4351) of Division 2.
A propane distribution system that is subject to the commission’s safety inspection and enforcement program pursuant to Chapter 4.1 (commencing with Section 4451) of Division 2.
“Compatible emergency response standards” means emergency response standards that are applicable to intrastate transmission and distribution lines that are in addition to, or more stringent than, the minimum safety standards adopted by the United States Department of Transportation pursuant to Chapter 601 (commencing with Section 60101) of Subtitle VIII of Title 49 of the United States Code and that the commission is authorized to adopt pursuant to Section 60104(c) of that chapter.
“High consequence area” has the same meaning as defined in the regulations adopted by the United States Department of Transportation pursuant to Chapter 601 (commencing with Section 60101) of Subtitle VIII of Title 49 of the United States Code (49 C.F.R. 192.903, as adopted January 1, 2011, or a successor regulation).
This chapter shall not apply to gas pipeline facilities owned and operated by a local publicly owned utility.
ARTICLE 2. Natural Gas Pipeline Safety Act of 2011 [955. - 972.]
This article shall be known and may be cited as the Natural Gas Pipeline Safety Act of 2011.
The commission is the state authority responsible for regulating and enforcing intrastate gas pipeline transportation and pipeline facilities pursuant to Chapter 601 (commencing with Section 60101) of Subtitle VIII of Title 49 of the United States Code, including the development, submission, and administration of a state pipeline safety program certification for natural gas pipelines pursuant to Section 60105 of that chapter.
For purposes of this section, the following terms have the following meanings:
“Gas pipeline” means an intrastate distribution line as described in paragraph (1) of, or an intrastate transmission line as described in paragraph (2) of subdivision (a) of Section 950.
“Hospital” means a licensed general acute care hospital as defined in subdivision (a) of Section 1250 of the Health and Safety Code.
“School” means a public or private preschool, elementary, or secondary school.
A gas corporation shall provide not less than three working days’ notice to the administration of a school or hospital prior to undertaking nonemergency excavation or construction of a gas pipeline, excluding any work that only uses hand tools, pneumatic hand tools, or vacuum technology for the purpose of marking and locating a subsurface installation pursuant to Article 2 (commencing with Section 4216) of Chapter 3.1 of Division 5 of Title 1 of the Government Code, if the work is located within 500 feet of the school or hospital. The notification shall include all of the following:
The name, address, telephone number, and emergency contact information for the gas corporation.
The specific location of the gas pipeline where the excavation or construction will be performed.
The date and time the excavation or construction is to be conducted and when the work is expected to be completed.
An invitation and a telephone number to call for further information on what the school or hospital should do in the event of a leak.
The gas corporation shall maintain a record of the date and time of any notification provided to the administration of a school or hospital prior to undertaking nonemergency excavation or construction of a gas pipeline and any subsequent contacts with the administration of a school or hospital relative to the excavation or construction and the actions taken, if any, in response to those subsequent contacts. The gas corporation shall maintain these records and make them available for inspection for no less than five years from the date of the notification.
On or before July 1, 2012, the commission shall open an appropriate proceeding or expand the scope of an existing proceeding to establish compatible emergency response standards that owners or operators of commission-regulated gas pipeline facilities shall be required to follow for intrastate transmission and distribution lines. The commission shall establish the standards to ensure that intrastate transmission and distribution lines have emergency response plans that adequately prepare them for a natural disaster or malfunction that could cause injury to human life or property, with the purpose of minimizing the occurrence of both.
The commission shall establish the compatible emergency response standards in consultation with the California Emergency Management Agency, the State Fire Marshal, and members of California’s first responder community including, but not limited to, members of the California Fire Chiefs Association.
The compatible emergency response standards shall require owners or operators of intrastate transmission and distribution lines to implement emergency response plans that are compatible with the United States Department of Transportation, Pipeline and Hazardous Materials Safety Administration’s regulations concerning emergency plans contained in Section 192.615 of Title 49 of the Code of Federal Regulations, and those plans shall include, but not be limited to, all of the following requirements:
Emergency shutdown and pressure reduction shall be utilized whenever deemed necessary and appropriate by the owners or operators to minimize hazards to life or property. An owner or operator shall notify appropriate first responders of emergency shutdown and pressure reduction.
During an emergency response effort, the incident commander may direct coordination between first responders and owners or operators to ensure timely and ongoing communication on decisions for emergency shutdown and pressure reduction.
Owners or operators of intrastate transmission and distribution lines shall establish and maintain liaison with appropriate fire, police, and other public officials to do all of the following:
Learn the responsibility and resources of each government organization that may respond to a gas pipeline emergency, including, but not limited to, the role of the incident commander in an emergency.
Acquaint the officials with the owner’s or operator’s ability in responding to a gas pipeline emergency.
Identify the types of gas pipeline emergencies of which the owner or operator notifies the officials.
Plan how the owner or operator and officials can engage in mutual assistance to minimize hazards to life or property.
Identify and update information on individual personnel responsible for the liaison with the appropriate first responder organizations.
Owners and operators of intrastate transmission lines shall provide the State Fire Marshal and the chief fire official of the applicable city, county, city and county, or fire protection district with instructions on how to access and utilize the National Pipeline Mapping System developed by the United States Department of Transportation, Pipeline and Hazardous Materials Safety Administration, utilizing data submitted pursuant to Section 60132 of Title 49 of the United States Code, to improve local response capabilities for pipeline emergencies.
Owners and operators of intrastate transmission and distribution lines, at least once each calendar year, shall meet with each local fire department having fire suppression responsibilities in the area where those lines are located to discuss and review contingency plans for emergencies involving the intrastate transmission and distribution lines within the jurisdiction of the local fire department.
Unless the commission determines that it is prohibited from doing so by subdivision (c) of Section 60104 of Title 49 of the United States Code, the commission shall require the installation of automatic shutoff or remote controlled sectionalized block valves on both of the following facilities, if it determines those valves are necessary for the protection of the public:
Intrastate transmission lines that are located in a high consequence area.
Intrastate transmission lines that traverse an active seismic earthquake fault.
Each owner or operator of a commission-regulated gas pipeline facility that is an intrastate transmission line shall provide the commission with a valve location plan, along with any recommendations for valve locations. The commission may make modifications to the valve location plan or provide for variations from any location requirements adopted by the commission pursuant to this section that it deems necessary or appropriate and consistent with protection of the public.
The commission shall additionally establish action timelines, adopt standards for how to prioritize installation of automatic shutoff or remote controlled sectionalized block valves pursuant to paragraph (1), ensure that remote and automatic shutoff valves are installed as quickly as is reasonably possible, and establish ongoing procedures for monitoring progress in achieving the requirements of this section.
The commission shall authorize recovery in rates for all reasonably incurred costs incurred for implementation of the requirements of this section.
The commission, in consultation with the Pipeline and Hazardous Materials Safety Administration of the United States Department of Transportation, shall adopt and enforce compatible safety standards for commission-regulated gas pipeline facilities that the commission determines should be adopted to implement the requirements of this section.
Each gas corporation shall prepare and submit to the commission a proposed comprehensive pressure testing implementation plan for all intrastate transmission lines to either pressure test those lines or to replace all segments of intrastate transmission lines that were not pressure tested or that lack sufficient details related to performance of pressure testing. The comprehensive pressure testing implementation plan shall provide for testing or replacing all intrastate transmission lines as soon as practicable. The comprehensive pressure testing implementation plan shall set forth criteria on which pipeline segments were identified for replacement instead of pressure testing.
The comprehensive pressure testing implementation plan shall include a timeline for completion that is as soon as practicable, and includes interim safety enhancement measures, including increased patrols and leak surveys, pressure reductions, prioritization of pressure testing for critical pipelines that must run at or near maximum allowable operating pressure values that result in hoop stress levels at or above 30 percent of specified minimum yield stress, and any other measure that the commission determines will enhance public safety during the implementation period. Engineering-based assumptions may be used to determine maximum allowable operating pressure in the absence of complete records, but only as an interim measure until such time as all the lines have been tested or replaced, in order to allow the gas system to continue to operate.
At the completion of the implementation period, all California natural gas intrastate transmission line segments shall meet all of the following:
Have been pressure tested.
Have traceable, verifiable, and complete records readily available.
Where warranted, be capable of accommodating in-line inspection devices.
Twice a year, or as determined by the commission, each gas corporation shall file with the division of the commission responsible for utility safety a gas transmission and storage safety report. The division of the commission responsible for utility safety shall review the reports to monitor each gas corporation’s storage and pipeline-related activities to assess whether the projects that have been identified as high risk are being carried out, and to track whether the gas corporation is spending its allocated funds on these storage and pipeline-related safety, reliability, and integrity activities for which they have received approval from the commission.
The gas transmission and storage safety report shall include a thorough description and explanation of the strategic planning and decisionmaking approach used to determine and rank the gas storage projects, intrastate transmission line safety, integrity, and reliability, operation and maintenance activities, and inspections of its intrastate transmission lines. If there has been no change in the gas corporation’s approach for determining and ranking which projects and activities are prioritized since the previous gas transmission and storage safety report, the subsequent report may reference the immediately preceding report.
If the division of the commission responsible for utility safety determines that there is a deficiency in a gas corporation’s prioritization or administration of the storage or pipeline capital projects or operation and maintenance activities, the division shall bring the problems to the commission’s immediate attention.
Each gas corporation shall demonstrate to the satisfaction of the commission, in its general rate case proceeding, that the requested revenue requirements will be sufficient to enable the gas corporation to fund those projects and activities necessary to maintain safe and reliable service and to meet federal and state safety requirements applicable to its gas plant, in a cost-effective manner.
When the federal National Transportation Safety Board (NTSB) submits a safety recommendation letter concerning gas pipeline safety to the commission, the commission shall provide the NTSB with a formal written response to each recommendation not later than 90 days after receiving the letter. The response shall state one of the following:
The commission’s intent to implement the recommendations in full, with a proposed timetable for implementation of the recommendations.
The commission’s intent to implement part of the recommendations, with a proposed timetable for implementation of those recommendations, and detailed reasons for the commission’s refusal to implement those recommendations that the commission does not intend to implement.
The commission’s refusal to implement the recommendations, with detailed reasons for the commission’s refusal to implement the recommendations.
If the NTSB issues a safety recommendation letter concerning any commission-regulated gas pipeline facility to the United States Department of Transportation, the federal Pipeline and Hazardous Materials Safety Administration (PHMSA), a gas corporation, or the commission, or the PHMSA issues an advisory bulletin concerning any commission-regulated gas pipeline facility, the commission shall determine if implementation of the recommendation or advisory is appropriate. The basis for the commission’s determination shall be detailed in writing and shall be approved by a majority vote of the commission.
If the commission determines that a safety recommendation made by the NTSB is appropriate or that action concerning an advisory bulletin is necessary, the commission shall issue orders or adopt rules to implement the safety recommendation or advisory as soon as practicable. In implementing the safety recommendation or advisory, the commission shall consider whether a more effective, or equally effective and less costly, alternative exists to address the safety issue that the recommendation or advisory addresses.
For purposes of this section, “gas corporation workforce” means the employees of a gas corporation and employees of an independent contractor of the gas corporation while working under contract with the gas corporation.
Each gas corporation shall develop a plan for the safe and reliable operation of its commission-regulated gas pipeline facility that implements the policy of paragraph (3) of subdivision (b) of Section 963, subject to approval, modification, and adequate funding by the commission.
By December 31, 2012, the commission shall review and accept, modify, or reject the plan for each gas corporation as part of a proceeding that includes a hearing. The commission shall build into any approved plan sufficient flexibility to redirect activities to respond to safety requirements.
Each gas corporation shall implement its approved plan.
The commission shall require each gas corporation to periodically review and update the plan, and the commission shall review and accept, modify, or reject an updated plan at regular intervals thereafter. The commission, pursuant to Section 1701.1, shall determine whether a proceeding on a proposed update to a plan requires a hearing, consistent with subdivision (e).
The plan developed, approved, and implemented pursuant to subdivision (b) shall be consistent with best practices in the gas industry and with federal pipeline safety statutes as set forth in Chapter 601 (commencing with Section 60101) of Subtitle VIII of Title 49 of the United States Code and the regulations adopted by the United States Department of Transportation pursuant to those statutes.
The plan developed, approved, and implemented pursuant to subdivision (b) shall set forth how the gas corporation will implement the policy established in paragraph (3) of subdivision (b) of Section 963 and achieve each of the following:
Provide for appropriate and effective system controls, with respect to both equipment and personnel procedures, to limit the damage from accidents, explosions, fires, and dangerous conditions.
Provide timely response to customer and employee reports of leaks and other hazardous conditions and emergency events, including disconnection, reconnection, and pilot-lighting procedures.
Include appropriate protocols for determining maximum allowable operating pressures on relevant pipeline segments, including all necessary documentation affecting the calculation of maximum allowable operating pressures.
Prepare for, or minimize damage from, and respond to, earthquakes and other major events.
Meet or exceed the minimum standards for safe design, construction, installation, operation, and maintenance of gas transmission and distribution facilities prescribed by regulations issued by the United States Department of Transportation in Part 192 (commencing with Section 192.1) of Title 49 of the Code of Federal Regulations.
Ensure an adequately sized, qualified, and properly trained gas corporation workforce to carry out the plan.
Any additional matter that the commission determines should be included in the plan.
The commission and gas corporation shall provide opportunities for meaningful, substantial, and ongoing participation by the gas corporation workforce in the development and implementation of the plan, with the objective of developing an industrywide culture of safety that will minimize accidents, explosions, fires, and dangerous conditions for the protection of the public and the gas corporation workforce.
Nothing in this section limits the obligation of a gas corporation to provide adequate service and facilities for the convenience of the public and its employees pursuant to Section 451 or the authority of the commission to enforce that obligation under state law.
For purposes of this section, the following terms have the following meanings:
“After-meter services” includes, but is not limited to, leak investigation, inspecting customer piping and appliances, carbon monoxide investigation, pilot relighting, and high bill investigation.
“Basic gas service” includes transmission, storage for reliability of service, and distribution of natural gas, purchasing natural gas on behalf of a customer, revenue cycle services, and after-meter services.
“Metering services” includes, but is not limited to, gas meter installation, meter maintenance, meter testing, collecting and processing consumption data, and all related services associated with the meter.
“Revenue cycle services” means metering services, billing the customer, collection, and related customer services.
The Legislature finds and declares all of the following:
In order to ensure that all core customers of a gas corporation continue to receive safe basic gas service, each existing gas corporation shall continue to provide this essential service.
A customer shall not be required to pay separate fees for utilizing services that protect public or customer safety.
It is the policy of the state that the commission and each gas corporation place safety of the public and gas corporation employees as the top priority. The commission shall take all reasonable and appropriate actions necessary to carry out the safety priority policy of this paragraph consistent with the principle of just and reasonable cost-based rates.
The commission shall require the distribution rate to continue to include after-meter services and shall authorize sufficient revenues and employee staffing to provide for prompt provision of these services to the public, consistent with the policy developed and implemented by the gas corporation and approved by the commission pursuant to Section 961.
In any ratemaking proceeding in which the commission authorizes a gas corporation to recover expenses for the gas corporation’s transmission pipeline integrity management program established pursuant to Subpart O (commencing with Section 192.901) of Part 192 of Title 49 of the United States Code or related capital expenditures for the maintenance and repair of transmission pipelines, the commission shall require the gas corporation to establish and maintain a balancing account for the recovery of those expenses. Any unspent moneys in the balancing account in the form of an accumulated account balance at the end of each rate case cycle, plus interest, shall be returned to ratepayers through a true-up filing. Nothing in this section is intended to interfere with the commission’s discretion to establish a two-way balancing account.
The commission shall perform an analysis of benchmark data and adopt safety performance metrics for pipeline safety.
The commission shall consider the following principles when adopting safety performance metrics:
Each safety performance metric shall be designed to be an indicator of safety performance.
Each safety performance metric shall be designed so that it may be reevaluated within a useful timeframe.
Each safety performance metric shall be designed so that the data inputs to the metric are verifiable.
The adopted set of safety performance metrics shall be robust enough to serve as a useful indicator of pipeline safety.
The commission shall evaluate a gas corporation’s safety performance using the safety performance metrics adopted pursuant to subdivision (a) and may implement a rate incentive program. The rate incentive program may contain penalties based on safety performance.
A penalty assessed against a gas corporation pursuant to this part in regards to a natural gas storage facility leak shall at least equal the amount necessary to reduce the impact on the climate from greenhouse gases by an amount equivalent to the impact on the climate from the greenhouse gases emitted by the leak from the natural gas storage facility, as determined by the State Air Resources Board. In determining the amount necessary to fully offset the impact on the climate from the gases emitted by the leak, the commission shall consider the extent to which the gas corporation has mitigated, or is in the process of mitigating, the impact on the climate from greenhouse gas emissions resulting from the leak.
This section shall not affect or be interpreted to affect the authority of the State Air Resources Board to adopt rules and regulations to reduce greenhouse gas emissions at natural gas storage facilities or to require mitigation of natural gas leaks from those facilities.
ARTICLE 3. Methane Leakage Abatement [975. - 978.]
For purposes of this chapter, “commission-regulated gas pipeline facility” has the same meaning as defined in Section 950.
With priority given to safety, reliability, and affordability of service, the commission shall adopt rules and procedures governing the operation, maintenance, repair, and replacement of those commission-regulated gas pipeline facilities that are intrastate transmission and distribution lines, as described in paragraphs (1) and (2) of subdivision (a) of Section 950, to achieve both of the following:
Minimize leaks as a hazard to be mitigated pursuant to paragraph (1) of subdivision (d) of Section 961, consistent with the requirements of Section 192.703(c) of Subpart M of Title 49 of the Code of Federal Regulations, the commission’s General Order 112-E, and their successors.
While giving due consideration to the cost considerations of Section 977, reduce emissions of natural gas from those commission-regulated gas pipeline facilities that are intrastate transmission and distribution lines to the maximum extent feasible in order to advance the state’s goals in reducing emissions of greenhouse gases pursuant to the California Global Warming Solutions Act of 2006 (Division 25.5 (commencing with Section 38500) of the Health and Safety Code).
As soon as practicable, the commission shall require gas corporations to file a report that includes, but is not limited to, all of the following:
A list of open leaks that are being monitored or are scheduled to be repaired.
A best estimate of gas loss due to leaks.
Not later than January 15, 2015, the commission, in consultation with the State Air Resources Board, shall commence a proceeding to adopt rules and procedures for those commission-regulated pipeline facilities that are intrastate transmission and distribution lines, as respectively described in paragraphs (1) and (2) of subdivision (a) of Section 950, to achieve the goals of subdivision (b).
The rules and procedures adopted pursuant to subdivision (d) shall accomplish all of the following:
Provide for the maximum technologically feasible and cost-effective avoidance, reduction, and repair of leaks and leaking components in those commission-regulated gas pipeline facilities that are intrastate transmission and distribution lines within a reasonable time after discovery, consistent with the California Global Warming Solutions Act of 2006 (Division 25.5 (commencing with Section 38500) of the Health and Safety Code) to achieve the goals in subdivision (b).
Provide for the repair of leaks as soon as reasonably possible after discovery, consistent with established safety requirements and the goals of reducing air pollution and the climate change impacts of methane emissions.
Evaluate the operations, maintenance, and repair practices of those commission-regulated gas pipeline facilities that are intrastate transmission and distribution lines to determine whether existing practices are effective at reducing methane leaks and promoting public safety, consistent with Section 961, achieve the goals of subdivision (b), and whether alternative practices may be more effective at achieving the goals of subdivision (b).
Establish and require the use of best practices for leak surveys, patrols, leak survey technology, leak prevention, and leak reduction. The commission shall consider in the development of best practices the quality of materials and equipment. Collected leak data shall remain the property of the utility and shall be available to the commission and parties in commission proceedings as determined by the commission or specified by statute.
Establish protocols and procedures for the development and use of metrics to quantify the volume of emissions from leaking gas pipeline facilities, and for evaluating and tracking leaks geographically and over time, that may be incorporated into the plans required by Section 961, or into other state emissions tracking systems, or both, including the regulations for the reporting of greenhouse gases of the State Air Resources Board. The quantification of emissions shall provide operators, the commission, and the public with accurate information about the number and severity of leaks and about the quantity of natural gas that is emitted into the atmosphere over time.
To the extent feasible, require the owner of each commission-regulated gas pipeline facility that is an intrastate transmission or distribution line to calculate and report to the commission and the State Air Resources Board a baseline systemwide leak rate, along with any data and computer models used in making that calculation, to periodically update that systemwide leak rate calculation, and to annually report on measures that will be taken in the following year to reduce the systemwide leak rate to achieve the goals of subdivision (b).
The rules and procedures, including best practices and repair standards, shall be incorporated into the safety plans required by Section 961 and the applicable general orders adopted by the commission.
Consistent with subdivision (e) of Section 961, the commission shall facilitate robust ongoing participation of the workforce of gas corporations and those state and federal entities that have regulatory roles of relevance in all aspects of the proceeding to ensure that the rules and procedures it adopts are not inconsistent with the regulations and procedures adopted by those agencies. Nothing in this section affects the commission’s authority to determine eligibility for intervenor compensation.
Nothing in this article shall affect or shall be interpreted to affect the existing authority of the State Air Resources Board to adopt rules and regulations to achieve the maximum technologically feasible and cost-effective greenhouse gas emission reductions and to maintain and continue emission reductions under the California Global Warming Solutions Act of 2006 (Division 25.5 (commencing with Section 38500) of the Health and Safety Code).
In order to achieve transparency and accountability for rate revenues and best value for ratepayers, and consistent with the commission’s existing ratemaking procedures and authority to establish just and reasonable rates, the commission shall consider all of the following:
Providing an adequate workforce to achieve the objectives of reducing hazards and emissions from leaks, including leak avoidance, reduction, and repair.
Providing revenues for all activities identified and required pursuant to Section 975, including any adjustment of allowance for lost and unaccounted for gas related to actual leakage volumes.
Providing guidance for treatment of expenditures as being either an item of expense or a capital investment.
The impact on affordability of gas service for vulnerable customers as a result of the incremental costs of compliance with the adopted rules and procedures.
Except as expressly so provided, this article does not expand or in any manner alter the commission’s jurisdiction over the regulation of emissions of greenhouse gases.
CHAPTER 4.7. Core Transport Agent [980. - 989.5.]
As used in this chapter, the following terms mean the following:
“Core gas customer” has the same meaning as that specified in the tariff of the gas corporation whose territory the customer in question lies within. A core small commercial customer account that is associated with and part of the same business operation as a noncore large commercial customer account is not a “core gas customer” for purposes of this chapter.
“Core transport agent” means an entity that offers core gas procurement service to customers within the service territory of a gas corporation, but does not include a gas corporation, and does not include a public agency that offers gas service to core and noncore gas customers within its jurisdiction, or within the service territory of a local publicly owned gas utility. “Core transport agent” includes the unregulated affiliates and subsidiaries of a gas corporation.
“Gas corporation” has the same meaning as that set forth in Section 222.
A core transport agent shall register with the commission within 90 days after the commission has adopted standards for financial viability, and technical and operational capacity. As a precondition to registration, the core transport agent shall provide, under oath, declaration, or affidavit, all of the following to the commission:
Legal name and any other names under which the core transport agent is doing business in California.
Current telephone number.
Current address.
Agent for service of process.
State and date of incorporation, if any.
Number for a customer contact representative, or other personnel for receiving customer inquiries.
Brief description of the nature of the service being provided.
Disclosure of any civil, criminal, or regulatory sanctions or penalties imposed within the 10 years immediately prior to registration, against the company or any owner, partner, officer, or director of the company pursuant to any state or federal consumer protection law or regulation, and of any felony convictions of any kind against the company or any owner, partner, officer, or director of the company. In addition, a core transport agent shall furnish the commission with fingerprints for those owners, partners, officers, and managers of the core transport agent specified by any commission decision applicable to all core transport agents. The commission shall submit completed fingerprint cards to the Department of Justice. Those fingerprints shall be available for use by the Department of Justice and the Department of Justice may transmit the fingerprints to the Federal Bureau of Investigation for a national criminal history record check. The commission may use information obtained from a national criminal history record check conducted pursuant to this section to determine a core transport agent’s eligibility for registration.
Proof of financial viability. The commission shall develop uniform standards for determining financial viability and shall publish those standards for public comment no later than June 30, 2014. In determining the financial viability of the core transport agent, the commission shall take into account the number of customers the potential registrant expects to serve, the number of therms of gas it expects to provide, and any other appropriate criteria to ensure that core gas customers have adequate recourse in the event of fraud or nonperformance.
Proof of technical and operational ability. The commission shall develop uniform standards for determining technical and operational capacity and shall publish those standards for public comment no later than June 30, 2014.
A statement stating the following:
“Neither the applicant, any of its affiliates, officers, directors, partners, agents, or owners (directly or indirectly) with more than 10 percent interest in the applicant, or anyone acting in a management capacity for applicant has: (A) held one of those positions with a company that filed for bankruptcy, (B) been personally found liable, or held one of those positions with a company that has been found liable, for fraud, dishonesty, failure to disclose, or misrepresentations to consumers or others, (C) been convicted of a felony, (D) been (to his or her knowledge) the subject of a criminal referral by a judge or public agency, (E) had a license of operating authority denied, suspended, revoked, or limited in any jurisdiction, (F) personally entered into a settlement, or held one of those positions with a company that has entered into settlement, of criminal or civil claims involving violations of Chapter 4 (commencing with Section 17000) of Part 2 of, or Part 3 (commencing with Section 17500) of Division 7 of, the Business and Professions Code or of any other statute, regulation, or decisional law relating to fraud, dishonesty, failure to disclosure, or misrepresentations to consumers or others, (G) been found to have violated any statute, law, or rule pertaining to public utilities or other regulated industries, or (H) entered into any settlements or agreements, made any voluntary payments, or agreed to any other type of monetary forfeitures in resolution of any action by any regulatory body, agency, or attorney general.”
Before reentering the market, a core transport agent whose registration has been revoked shall file a formal application with the commission that satisfies the requirements set forth in Section 982 and demonstrates the fitness and ability of the core transport agent to comply with all applicable rules of the commission.
Registration with the commission is an exercise of the licensing function of the commission, and does not constitute regulation of the rates or terms and conditions of service offered by core transport agents. This part does not authorize the commission to regulate the rates or terms and conditions of service offered by core transport agents.
The registration shall be deemed approved and a registration number issued no later than 45 days after the required information has been submitted, unless the commission’s executive director finds, upon review of the information submitted by the core transport agent or available to the commission, that there is evidence to support a finding that the core transport agent has committed an act constituting grounds for denial of registration as specifically set forth in the operative provisions of this chapter, including, but not limited to, subdivision (c).
Upon a finding by the commission’s executive director that there is evidence to support a finding that the core transport agent has committed an act constituting grounds for denial of registration as set forth in this section, the commission shall notify the core transport agent in writing, cause the documents submitted by the core transport agent to be filed as a formal application for registration, and notice an expedited hearing on the registration of the core transport agent to be held within 30 days of the notification to the core transport agent of the executive director’s finding of evidence to support denial of registration. The commission shall, within 45 days after holding the hearing, issue a decision on the registration request which shall be based on the findings of fact and conclusions of law based on the evidence presented at the hearing. The decision shall include the findings of fact and the conclusions of law relied upon.
The commission may deny an application for registration in accordance with subdivision (b) on the grounds that the core transport agent or any officer or director of the core transport agent has one or more of the following:
Been convicted of a crime as described in paragraph (8) of subdivision (a) of Section 981.
Failure to make a sufficient showing with respect to paragraphs (1) to (10), inclusive, of subdivision (a) of Section 981.
Knowingly made a false statement of fact in the application for registration.
The commission may deny registration pursuant to this subdivision only if the crime or act is substantially related to the qualifications, functions, or duties required to provide gas service to end use customers of gas or the false statement is material to the registration application. For purposes of this subdivision, conviction of a crime shall be established in the same manner as that set forth in paragraph (1) of subdivision (a) of Section 480 of the Business and Professions Code.
The commission shall require core transport agents registered under this section to update their registration information set forth in paragraphs (1) to (10), inclusive, of subdivision (a) of Section 981 within 60 days of any material change in the information provided. Material changes to any other information required pursuant to this article shall be updated annually.
The commission shall accept, compile, and attempt to informally resolve consumer complaints regarding core transport agents. If the commission reasonably suspects a pattern of customer abuses, the commission may, on its own motion, initiate investigations into the activities of a core transport agent offering gas service. Consumer complaints regarding service by a public agency offering gas service within the political boundary of the public agency or service territory of a local publicly owned gas utility shall continue to be resolved by the public agency. Within the service territory of a local publicly owned utility, consumer complaints arising from the violation of core transport service rules adopted by the governing body of the local publicly owned utility shall be resolved through the local publicly owned utility’s consumer complaint procedures.
Notwithstanding other provisions, core gas customers shall have the option to proceed with a complaint against a core transport agent either through an action filed in the judicial court system or through a complaint filed with the commission. A customer who elects either the judicial or commission remedies may not raise the same claim in both forums. The commission shall have the authority to accept, compile, and resolve core gas consumer complaints, including the authority to award reparations. The commission’s authority in these complaint proceedings is limited to adjudication of complaints regarding core gas service provided by a core transport agent and shall not be expanded to include an award of any damages through regulation of the rates or charges of the core transport agent. However, a person or core transport agent that takes a conflict to the commission shall not be precluded from pursuing an appeal of the decision through the courts as provided for by law.
In connection with customer complaints or commission investigations into customer abuses, core transport agents shall provide the commission access to their accounts, books, papers, and documents related to California transactions as described in Sections 313 and 314, if the information is relevant to the complaint or investigation.
A core transport agent shall not discontinue service to a customer for a disputed amount if that customer has filed a complaint that is pending with the commission, and that customer has paid the disputed amount into an escrow account.
Upon a finding by the commission’s executive director that there is evidence to support a finding that the core transport agent has committed an act constituting grounds for suspension or revocation of registration as set forth in subdivision (b), the commission shall notify the core transport agent in writing and notice an expedited hearing on the suspension or revocation of the core transport agent’s registration to be held within 30 days of the notification to the core transport agent of the executive director’s finding of evidence to support suspension or revocation of registration. The commission shall, within 45 days after holding the hearing, issue a decision on the suspension or revocation of registration, which shall be based on findings of fact and conclusions of law based on the evidence presented at the hearing. The decision shall include the findings of fact and the conclusions of law relied upon.
A core transport agent may have its registration suspended or revoked, immediately or prospectively, in whole or in part, for any of the following acts:
Making material misrepresentations in the course of soliciting customers, entering into service agreements with those customers, or administering those service agreements.
Dishonesty, fraud, or deceit with the intent to substantially benefit the core transport agent or its employees, agents, or representatives, or to disadvantage retail gas customers.
If the commission finds that there is evidence that the core transport agent is not financially or operationally capable of providing the offered gas service.
The misrepresentation of a material fact by an applicant in obtaining a registration pursuant to Section 981.
Pursuant to its authority to revoke or suspend registration, the commission may suspend a registration for a specified period or revoke the registration, or in lieu of suspension or revocation, impose a moratorium on adding or soliciting additional customers. Any suspension or revocation of a registration shall require the core transport agent to cease serving customers within the boundaries of investor-owned gas corporations, and the affected customers shall be served by the gas corporation until the time when they may select service from another core transport agent. A customer shall not be liable for the payment of any early termination fees or other penalties to any core transport agent under the service agreement if the serving core transport agent’s registration is suspended or revoked.
If a customer of a core transport agent is involuntarily returned to service provided by a gas corporation, any reentry fee imposed on that customer that the commission deems is necessary to avoid imposing costs on other customers of the gas corporation shall be the obligation of the core transport agent, except in the case of a customer returned due to default in payment or other contractual obligations or because the customer’s contract has expired. As a condition of its registration, a core transport agent shall post a bond or demonstrate insurance sufficient to cover those reentry fees, including reentry fees for customers returned in the event of the core transport agent becoming insolvent.
If a customer files a claim with a gas corporation for damages to property resulting from the curtailment of gas service due to the failure of the gas corporation to reasonably provide service or restore service within a reasonable time after a fire, flood, earthquake, other natural disaster, or act of God, the gas corporation shall inform the customer that the claim may be pursued in small claims court or other judicial courts, depending on the amount of the claim.
In order to carry out essential elements of a sustainable and effective consumer protection program in connection with core transport agents offering gas service to core gas customers as intended by the Legislature in this chapter, the following shall apply:
A registration fee of one hundred dollars ($100) shall be collected from a core transport agent required to register under this chapter and the fee proceeds shall be deposited in the Public Utilities Reimbursement Account established under Section 402. The commission may adjust the fee as necessary to recover the cost of administering the program.
The commission shall annually determine the costs of administering the registration program and other facets of consumer protection directly related to the core transport service transactions of core transport agents, including the cost for the duties imposed pursuant to subdivision (c) of Section 984.5. The commission shall only collect those costs not already being collected elsewhere. Registrants who fail to submit to the commission required fees or information upon which fees are calculated within 30 days of billing shall be subject to a 15-percent penalty.
The commission shall compile and regularly update the following information: names and contact numbers of a registered core transport agent, information to assist consumers in making service choices, and the number of customer complaints against specific providers in relation to the number of customers served by those providers and the disposition of those complaints. To facilitate this function, registered entities shall file with the commission information describing the terms and conditions of any standard service plan made available to core gas customers. The commission shall adopt a standard format for this filing. The commission shall maintain and make generally available a list of entities offering core transport services operating in California. This list shall include all registered core transport agents and those agents not required to be registered that request the commission to be included on the list. The commission shall, upon request, make this information available at no charge. Notwithstanding any other law, public agencies that are registered entities shall be required to disclose their terms and conditions of service contracts only to the same extent that other registered entities would be required to disclose the same or similar service contracts.
The commission shall issue public alerts about companies attempting to provide core transport service in the state in an unauthorized or fraudulent manner as described in subdivision (b) of Section 983.5.
The commission shall compile and post on its Internet Web site easily understandable informational guides or other tools to help core gas customers understand core transport service options. In implementing these provisions, the commission shall pay special attention to ensuring that customers, especially those with limited-English-speaking ability or other disadvantages when dealing with marketers, receive correct, reliable, and easily understood information to help them make informed choices. The commission shall not make specific recommendations, rank the relative attractiveness of specific service offerings of registered providers of core transport services, or provide customer-specific assistance in the evaluation of core transport agents.
The Public Advocate’s Office of the Public Utilities Commission shall analyze customers’ complaints submitted to the gas corporation and to the commission and the disposition of those complaints to determine if the changes in the consumer protection rules are necessary to better protect the participants in the core transportation program, and make recommendations to the commission regarding those rule changes.
Rules that implement the following minimum standards shall be adopted by the commission for core transport agents offering gas services to core gas customers and the governing body of a public agency offering gas services to core gas customers within its jurisdiction:
Confidentiality. Customer information shall be confidential unless the customer consents in writing. This shall encompass confidentiality of customer-specific billing, credit, or usage information. This requirement shall not extend to disclosure of generic information regarding the usage, load shape, or other general characteristics of a group or rate classification, unless the release of that information would reveal customer-specific information because of the size of the group, rate classification, or nature of the information.
Physical disconnects and reconnects. Only a gas corporation, or a publicly owned gas utility, that provides physical delivery service to the affected customer shall have the authority to physically disconnect or reconnect a customer from the transmission or distribution grid. Physical disconnection by gas corporations subject to the commission’s jurisdiction shall occur only in accordance with protocols established by the commission. Physical disconnection by publicly owned gas utilities shall occur only in accordance with protocols established by the governing board of the local publicly owned gas utility.
Change in providers. Upon adequate notice supplied by a core transport agent to the gas corporation or local publicly owned gas utility providing physical delivery service, customers who are eligible for core transport service may change their energy supplier. Energy suppliers may charge for this change, provided that any fee or penalty charged by the supplier associated with early termination of service, shall be disclosed in that contract or applicable tariff.
Written notices. Notices describing the terms and conditions of service as described in Section 986, service agreements, notices of late payment, notices of discontinuance of service, and disconnection notices addressed to core gas customers shall be easily understandable and shall be provided in the language in which the core transport agent offered the services.
Billing. All bills shall have a standard bill format, as determined by the commission or the governing body, and shall contain sufficient detail for the customer to recalculate the bill for accuracy. Any late fees shall be separately stated. A core transport agent shall provide on all customer bills a telephone number by which customers may contact the core transport agent to report and resolve billing inquiries and complaints. A core transport agent contacted by a customer regarding a billing dispute shall advise the customer at the time of the initial contact that the customer may file a complaint with the commission if the customer’s dispute is not satisfactorily resolved by the core transport agent.
Meter integrity. A gas customer shall have a reasonable opportunity to have his or her meter tested to ensure the reasonable accuracy of the meter. The commission or governing body shall determine who is responsible for the cost of that testing.
Customer deposits. Core transport agents may require customer deposits before commencing service, but in no event shall the deposit be more than the estimated bill for the customer for a three-month period.
Additional protections. The commission or the governing body may adopt additional core gas consumer protection standards that are in the public interest.
Except for a gas corporation, or a local publicly owned gas utility offering gas service to core gas customers within its service territory, a core transport agent offering gas service to core gas customers shall, prior to the commencement of service, provide the potential customer with a written notice of the service describing the price, terms, and conditions of the service. The notices shall include all of the following:
A clear description of the price, terms, and conditions of service, including all of the following:
The price of gas expressed in a format that makes it possible for core gas customers to compare and select among similar products and services on a standard basis. The commission shall adopt rules to implement this subdivision. The commission shall require disclosure of the total price of gas on a cents-per-therm basis, including the costs of all gas services and charges regulated by the commission. The commission shall also require estimates of the total monthly bill for the gas service at varying consumption levels, including the costs of all gas services and charges regulated by the commission. In determining these rules, the commission may consider alternatives to the cents-per-therm disclosure if other information would provide the customer with sufficient information to compare among alternatives on a standard basis.
Separate disclosure of all recurring and nonrecurring charges associated with the sale of gas.
If services other than gas are offered, an itemization of the services and the charge or charges associated with each.
A description of the potential customer’s right to rescind the contract without fee or penalty as described in Section 989.1.
An explanation of the customer’s financial obligations, as well as the procedures regarding past due payments, discontinuance of service, billing disputes, and service complaints.
The core transport agent’s registration number, if applicable.
The right to change service providers upon written notice, including disclosure of any fees or penalties assessed by the supplier for early termination of a contract.
A description of the availability of low-income assistance programs for qualified customers and how customers can apply for these programs.
The commission may assist core transport agents in developing the notice. The commission may suggest inclusion of additional information it deems necessary for the consumer protection purposes of this section. On at least a semiannual basis, a core transport agent shall provide the commission with a copy of the form of notice included in its standard service plans made available to core gas customers as described in subdivision (a) of Section 984.5.
Any core transport agent offering gas services who declines to provide those services to a consumer shall, upon request of the consumer, disclose to that consumer the reason for the denial in writing within 30 days. At the time service is denied, the core transport agent shall disclose to the consumer his or her right to make this request. Consumers shall have at least 30 days from the date service is denied to make the request.
The commission shall maintain a list of core gas customers who do not wish to be solicited by telephone, by a gas corporation, marketer, broker, or aggregator for gas service, to subscribe to or change their core transport agent. The commission shall not assess a charge for inclusion of a customer on the list. The list shall be updated periodically, but no less than quarterly.
The list shall include sufficient information for gas corporations, marketers, brokers, or aggregators of gas service to identify customers who do not wish to be solicited, including a customer’s address and telephone number. The list shall be made accessible electronically from the commission to any party regulated as a gas corporation or registered with the commission as an electric marketer, broker, or aggregator of gas service.
A gas corporation, marketer, broker, or aggregator of gas service shall not solicit, by telephone, any customer on the list prepared pursuant to subdivision (a). Any gas corporation, marketer, broker, or aggregator of gas service, or the representative of a gas corporation, marketer, broker, or aggregator of gas service, who solicits any customer on the list prepared pursuant to subdivision (a) more than once shall be liable to the customer for twenty-five dollars ($25) for each contact in violation of this subdivision.
Notwithstanding any other provision of this chapter, requirements placed on a core transport agent shall not apply to gas services provided by a local publicly owned gas utility to customers within the jurisdiction or service territory of that local publicly owned gas utility.
Unclaimed refunds ordered by the commission, and any accrued interest, may be used by the commission to fund additional consumer protection efforts.
In addition to any other right to revoke an offer, core gas customers of gas service, have the right to cancel a contract for gas service until midnight of the third business day after the day on which the buyer signs an agreement or offer to purchase.
Cancellation occurs when the buyer gives written notice of cancellation to the seller at the address specified in the agreement or offer.
Notice of cancellation, if given by mail, is effective when deposited in the mail properly addressed with postage prepaid.
Notice of cancellation given by the buyer need not take the particular form as provided with the contract or offer to purchase and, however expressed, is effective if it indicates the intention of the buyer not to be bound by the contract.
A consumer damaged by a violation of this chapter by a core transport agent is entitled to recover all of the following:
Actual damages.
The consumer’s reasonable attorney’s fees and court costs.
Exemplary damages, in the amount the court deems proper, for intentional or willful violations.
Equitable relief as the court deems proper.
The rights, remedies, and penalties established by this chapter are in addition to the rights, remedies, or penalties established under any other law.
This chapter does not abrogate any authority of the Attorney General to enforce existing law.
CHAPTER 5. Certificates of Public Convenience and Necessity [1001. - 1103.]
ARTICLE 1. Specified Utilities [1001. - 1013.]
A railroad corporation whose railroad is operated primarily by electricity, street railroad corporation, gas corporation, electrical corporation, telegraph corporation, telephone corporation, water corporation, or sewer system corporation shall not begin the construction of a street railroad, of a line, plant, or system, or of any extension thereof, without having first obtained from the commission a certificate that the present or future public convenience and necessity require or will require its construction.
The extension, expansion, upgrade, or other modification of an existing electrical transmission facility, including transmission lines and substations, does not require a certificate that the present or future public convenience and necessity requires or will require its construction.
This article does not require those corporations to secure that certificate for an extension within any city or city and county within which it has lawfully commenced operations, for an extension into territory either within or without a city or city and county contiguous to its street railroad, line, plant, or system, and not served by a public utility of like character, or for an extension within or to territory already served by it, necessary in the ordinary course of its business. If any public utility, in constructing or extending its line, plant, or system, interferes or is about to interfere with the operation of the line, plant, or system of any other public utility or of the water system of a public agency, already constructed, the commission, on complaint of the public utility or public agency claiming to be injuriously affected, may, after hearing, make an order and prescribe terms and conditions for the location of the lines, plants, or systems affected as to it may seem just and reasonable.
In a proceeding evaluating the issuance of a certificate of public convenience and necessity for a proposed transmission project, the commission shall establish a rebuttable presumption with regard to need for the proposed transmission project in favor of an Independent System Operator governing board-approved need evaluation if all of the following are satisfied:
The Independent System Operator governing board has made explicit findings regarding the need for the proposed transmission project and has determined that the proposed project is the most cost-effective transmission solution.
The Independent System Operator is a party to the proceeding.
The Independent System Operator governing board-approved need evaluation is submitted to the commission within sufficient time to be included within the scope of the proceeding.
There has been no substantial change to the scope, estimated cost, or timeline of the proposed transmission project as approved by the Independent System Operator governing board.
The commission shall exempt the construction of any line, plant, or system, or extension thereof, located outside the boundaries of the state from the requirements of Section 1001, upon the application of the public utility constructing that line, plant, or system, or extension thereof, if the public utility derives 75 percent or more of its operating revenues from outside the state, as recorded in the fiscal period immediately before the filing of the application, unless the commission determines that the public interest requires that the construction should not be exempt from Section 1001.
Except as provided in subdivision (c), the commission shall make the determination denying the exemption, as specified in subdivision (a), within 90 days after the public utility files the application for exemption with the commission. If the commission fails to make this determination within that 90-day period, the construction of that line, plant, or system, or extension thereof, is exempt from the requirements of Section 1001.
The commission and the public utility filing the application for exemption may, if both agree, extend the time period within which the commission is required to make the determination denying the exemption, for not more than an additional 60 days after the expiration of the 90-day period specified in subdivision (b).
The commission, as a basis for granting any certificate pursuant to Section 1001 shall give consideration to the following factors:
Community values.
Recreational and park areas.
Historical and aesthetic values.
Influence on environment, except that in the case of any line, plant, or system or extension thereof located in another state which will be subject to environmental impact review pursuant to the National Environmental Policy Act of 1969 (Chapter 55 (commencing with Section 4321) of Title 42 of the United States Code) or similar state laws in the other state, the commission shall not consider influence on the environment unless any emissions or discharges therefrom would have a significant influence on the environment of this state.
With respect to any thermal powerplant or electrical transmission line for which a certificate is required pursuant to the provisions of Division 15 (commencing with Section 25000) of the Public Resources Code, no certificate of public convenience and necessity shall be granted pursuant to Section 1001 without such other certificate having been obtained first, and the decision granting such other certificate shall be conclusive as to all matters determined thereby and shall take the place of the requirement for consideration by the commission of the four factors specified in subdivision (a) of this section.
The commission may, by resolution, adopt successor guidelines to the commission’s Guidelines for Energy Project Applications Requiring CEQA Compliance: Pre-filing and Proponent’s Environmental Assessments (November 2019) at a publicly noticed meeting to address its receipt and review of and actions on applications for the construction of electrical transmission facilities subject to its regulatory jurisdiction. These guidelines shall be designed to mitigate ratepayer costs, lessen the uncertainty of the submittal process, and improve the commission’s review process by increasing applicant understanding of applicable requirements with the intent of advancing the timely resolution of the construction of the facilities and efficient disposition of the applications.
To the extent there is a conflict or inconsistency between the content in the guidelines adopted or revised pursuant to this section and a commission rule of practice or procedure addressing the completeness of applications for electrical transmission facilities, the guidelines shall prevail.
The guidelines adopted pursuant to this section shall supersede the commission’s Guidelines for Energy Project Applications Requiring CEQA Compliance: Pre-filing and Proponent’s Environmental Assessments (November 2019), unless the guidelines adopted pursuant to this section specify otherwise.
Notwithstanding any other law, guidelines adopted pursuant to this section are exempt from the requirements of Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code.
For purposes of this section, “electrical transmission facilities” means electrical generation facilities, transmission, power, and distribution line facilities, and substations, as described in commission General Order No. 131-D, as it may be amended from time to time.
In issuing a certificate of convenience and necessity for additional natural gas pipeline capacity proposed for construction within this state, the commission shall consider the state’s need to provide sufficient and competitively priced natural gas supplies for both present and anticipated future residential, industrial, commercial, and utility demand. When it finds that it is in the state’s best interests to do so, the commission shall expeditiously issue certificates of convenience and necessity for those additional natural gas pipeline capacity projects.
Every electrical and every gas corporation submitting an application to the commission for a certificate authorizing the new construction of any electric plant, line, or extension, or gas plant, line, or extension, not subject to the provisions of Chapter 6 (commencing with Section 25500) of Division 15 of the Public Resources Code, shall include all of the following information in the application in addition to any other required information:
Preliminary engineering and design information on the project. The design information provided for thermal electric plants shall include preliminary data regarding the operating characteristics of the proposed plant, including, but not limited to, the annual capacity factor, availability factor, and the heat rate for each year of the useful life of the plant, line, or extension.
A project implementation plan showing how the project would be contracted for and constructed. This plan shall show how all major tasks would be integrated and shall include a timetable identifying the design, construction, completion, and operation dates for each major component of the plant, line, or extension.
An appropriate cost estimate, including preliminary estimates of the costs of financing, construction, and operation, including fuel, maintenance, and dismantling or inactivation after the useful life of the plant, line, or extension.
A cost analysis comparing the project with any feasible alternative sources of power. The corporation shall demonstrate the financial impact of the plant, line, or extension construction on the corporation’s ratepayers, stockholders, and on the cost of the corporation’s borrowed capital. The cost analyses shall be performed for the projected useful life of the plant, line, or extension, including dismantling or inactivation after the useful life of the plant, line, or extension.
A design and construction management and cost control plan which indicates the contractual and working responsibilities and interrelationships between the corporation’s management and other major parties involved in the project. This plan shall also include a construction progress information system and specific cost controls.
Every electrical and gas corporation submitting an application to the commission for a certificate authorizing the new construction of an electric plant, line, or extension, or gas plant, line, or extension, which is subject to the provisions of Chapter 6 (commencing with Section 25500) of Division 15 of the Public Resources Code, shall include in the application the information specified in subdivisions (b), (c), and (e) of Section 1003, in addition to any other required information. The corporation may also include in the application any other information specified in Section 1003.
Before any certificate may issue, under this article, a certified copy of its articles of incorporation or charter, if the applicant is a corporation, shall be filed in the office of the commission. Every applicant for a certificate shall file in the office of the commission such evidence as is required by the commission to show that the applicant has received the required consent, franchise, or permit of the proper county, city and county, city, or other public authority.
The commission may, with or without hearing, issue the certificate as prayed for, or refuse to issue it, or issue it for the construction of a portion only of the contemplated street railroad line, plant, or system, or extension thereof, or for the partial exercise only of the right or privilege, and may attach to the exercise of the rights granted by the certificate such terms and conditions, including provisions for the acquisition by the public of the franchise or permit and all rights acquired thereunder and all works constructed or maintained by authority thereof, as in its judgment the public convenience and necessity require; provided, however, upon timely application for a hearing by any person entitled to be heard thereat, the commission, before issuing or refusing to issue the certificate, shall hold a hearing thereon.
When the commission issues a certificate for the new construction of a gas or electric plant, line, or extension, the certificate shall specify the operating and cost characteristics of the plant, line, or extension, including, but not limited to, the size, capacity, cost, and all other characteristics of the plant, line, or extension which are specified in the information which the gas and electrical corporations are required to submit, pursuant to Section 1003 or 1003. 5.
The commission shall issue a decision on an application for a certificate within 18 months of the date of filing of the completed application, when all of the following are true:
The application is for a certificate for building or upgrading an electrical transmission line that the commission finds necessary to provide transmission to load centers for electricity generated in a high priority renewable energy zone or is reasonably necessary to facilitate achievement of the renewables portfolio standard established in Article 16 (commencing with Section 399.11) of Chapter 2.3.
The commission has considered all of the following:
The utilization of rights-of-way by upgrading existing transmission facilities instead of building new transmission facilities, where technically and economically justifiable.
The expansion of existing rights-of-way, if technically and economically feasible, when construction of new transmission lines is required.
The creation of new rights-of-way when justified by environmental, technical, and economic reasons.
The availability of cost-effective alternatives to transmission, such as energy efficiency measures and distributed generation.
The commission has not expressly found any of the following:
That the investment is not reasonable and necessary to maintain or enhance reliability of the transmission grid.
That the building or upgrading of the electrical transmission line will not maintain or enhance efficient use of the transmission grid.
That the transmission line fails to meet other applicable standards and requirements for approval and construction.
An extension of time may be granted by the commission if it finds the extension is necessary for completion of review pursuant to the California Environmental Quality Act (Division 13 (commencing with Section 21000) of the Public Resources Code).
Whenever the commission issues to an electrical or gas corporation a certificate authorizing the new construction of any addition to or extension of the corporation’s plant estimated to cost greater than fifty million dollars ($50,000,000), the commission shall specify in the certificate a maximum cost determined to be reasonable and prudent for the facility. The commission shall determine the maximum cost using an estimate of the anticipated construction cost, taking into consideration the design of the project, the expected duration of construction, an estimate of the effects of economic inflation, and any known engineering difficulties associated with the project.
After the certificate has been issued, the corporation may apply to the commission for an increase in the maximum cost specified in the certificate. The commission may authorize an increase in the specified maximum cost if it finds and determines that the cost has in fact increased and that the present or future public convenience and necessity require construction of the project at the increased cost; otherwise, it shall deny the application.
After construction has commenced, the corporation may apply to the commission for authorization to discontinue construction and recover those costs which were reasonably and prudently incurred. After a showing to the satisfaction of the commission that the present or future public convenience and necessity no longer require the completion of construction of the project, the commission may authorize discontinuance of construction and the recovery of those construction costs which were reasonable and prudent.
In any decision establishing rates for an electrical or gas corporation reflecting the reasonable and prudent costs of the new construction of any addition to or extension of the corporation’s plant, when the commission has found and determined that the addition or extension is used and useful, the commission shall consider whether or not the actual costs of construction are within the maximum cost specified by the commission.
When a complaint has been filed with the commission alleging that a public utility of the class specified in Section 1001 is engaged or is about to engage in construction work without having secured from the commission a certificate of public convenience and necessity as required by this article, the commission may, with or without notice, make its order requiring the public utility complained of to cease and desist from such construction until the commission makes and files its decision on the complaint or until the further order of the commission.
The commission may, after notice and hearing, prior to authorizing any water or sewer system corporation having annual gross operating revenues under two hundred thousand dollars ($200,000) to construct, operate, acquire, expand, or improve its line, plant, or system, prescribe, as a condition to granting such authority, that the corporation file with the commission a bond with sufficient sureties, subject to approval of the commission, in a reasonable amount not exceeding fifty thousand dollars ($50,000) payable to the commission and conditioned on the corporation’s furnishing adequate and sufficient service within its service area. The commission may, after notice and hearing, declare all or any part of the bond forfeited after finding that the corporation has willfully failed to furnish adequate and sufficient service without just cause or excuse and that such failure has continued for an unreasonable duration. Such bond shall further provide for payment to the commission of the amount of any penalty assessed against the corporation pursuant to Section 2107. The commission may, upon petition by a water or sewer system corporation, for good cause, reduce the amount or eliminate the requirement of any bond which it has required to be filed pursuant to this section.
No corporation or person shall begin to operate or cause to be operated any vessel for the transportation of persons or property, for compensation, between points in this state, without first having obtained from the commission a certificate declaring that public convenience and necessity require such operation, but no such certificate shall be required as to termini between which any such corporation or person is lawfully operating vessels in good faith under this part as it existed prior to August 17, 1923, under tariffs and schedules of such corporations or persons, lawfully on file with the commission. Every applicant for such a certificate shall file in the office of the commission application and evidence in the form required by the commission. The commission may, with or without hearing, issue the certificate as prayed for, or refuse to issue it, or issue it for the partial exercise only of the privilege sought, or issue it for operation between certain points only, and may attach to the exercise of the rights granted by the certificate such terms and conditions as, in its judgment, the public convenience and necessity require.
The commission, in the exercise of the jurisdiction conferred upon it by the Constitution of the state and by this part, and consistent with Section 9 of Article I of the California Constitution and Section 10 of Article I of the United States Constitution, may grant certificates of public convenience and necessity, make decisions and orders, and prescribe rules affecting vessel common carriers notwithstanding the provisions of any ordinance, permit, or franchise of any city, county, or other political subdivision of this state, and in the case of conflict between any certificate, decision, order, or rule of the commission and any ordinance, permit, or franchise, the certificate, decision, order, or rule of the commission shall prevail.
Any municipal corporation or port district operating or maintaining a port may apply to the commission for the issuance of a certificate of convenience and necessity to require any person or corporation operating vessels between points in this State, to serve that port. The commission may, after hearing, issue the certificate as prayed for, or refuse to issue it, or issue it for the partial exercise of the rights granted by any such certificate, upon such terms and conditions as in its judgment the public convenience and necessity require, and upon making the order the person or corporation to which the certificate is issued, shall be compelled to perform the service.
Any right, privilege, franchise, or permit held, owned or obtained by any person or corporation for the operation of vessels between points in this State may be sold, assigned, leased, transferred, or inherited as other property, only upon authorization by the commission. The commission may at any time for a good cause suspend, and upon notice to the grantee of any certificate or operative right and opportunity to be heard revoke, alter, or amend any certificate or operative right issued or existing under the provisions of Sections 1007 or 1008.
The provisions of this article are enacted under the State’s reserved power over public utilities or corporations, or both, as the case may be, for the purpose of acting on the right of the grantee of a public utility franchise granted by a city, county, or city and county, to exercise rights thereunder, and not for the purpose of acting on the right of any city or city and county to grant any such franchise. The Legislature hereby declares that the provisions of this article shall remain in full force and effect concurrently with the right of any city or city and county to grant franchises for public utilities upon the terms and conditions and in the manner prescribed by law.
The commission may by rule or order, partially or completely exempt certain telecommunications services offered by telephone and telegraph corporations from the certification requirements of Section 1001 and instead subject them to registration as the commission may determine. Telephone corporations that the commission determines have monopoly power or market power in a relevant market or markets shall have a certificate of public convenience and necessity and shall not be eligible for designation as registered telephone corporations. A telephone corporation that has been found not to have monopoly power or market power in a relevant market or markets by the commission shall be eligible for registration subject to the approval of the commission. A telephone corporation operating in this state shall either have a certificate of public convenience and necessity or be registered under this section or be a telephone corporation authorized to operate in California without a certificate of public convenience and necessity.
Registered telephone corporations qualifying under this section shall maintain an active registration with the commission at all times and comply with commission rules and regulations established for registered telephone corporations qualifying under this section.
The registration of registered telephone corporations qualifying under this section shall be on a form prescribed by the commission and shall contain any information the commission may by rule or order require, but shall include as a minimum the name and address of the telephone corporation’s registered agent, if any, the name, address, and title of each officer or director, and a description of the telecommunications services it offers or intends to offer.
Prior to designating any telephone corporation for registration status, the commission shall adopt rules to do both of the following:
Verify the financial viability of the corporation.
Verify that the officers of the corporation have no prior history of committing fraud on the public.
The commission shall require as a precondition to registration the procurement of a performance bond sufficient to cover taxes or fees, or both, collected from customers and held for remittance and advances or deposits the telecommunications company may collect from its customers, or order that those advances or deposits be held in escrow or trust.
The commission may require, as a precondition to registration, the procurement of a performance bond sufficient to facilitate the collection of fines, penalties, and restitution related to enforcement actions that can be taken against a telecommunications company.
The commission may, with or without a hearing, grant a telephone corporation registration status and an exemption from the certification requirements of Section 1001. However, upon timely application, any person entitled to be heard may file a protest on whether a telephone corporation should be eligible for registration status and the granting of an exemption from the certification requirement of Section 1001. Upon a determination that the protest has presented a prima facie case that a telephone corporation should not be granted registration status and an exemption from Section 1001, a hearing shall be held.
The commission, after notice and a hearing if requested, may cancel, revoke, or suspend the registration of any telephone corporation upon any of the following grounds:
The corporation does not provide the information required by this article.
The corporation fails to provide or maintain a performance bond.
The corporation conducts any illegal telephone operations.
The corporation violates any of the applicable provisions of this code or of any regulations issued thereunder.
The corporation violates any order, decision, rule, regulation, direction, demand, or requirement established by the commission under this code.
The corporation fails to pay any fee or fine imposed upon the utility under this code.
The corporation files a false statement to the commission.
The corporation knowingly defrauds a customer.
As an alternative to the cancellation, revocation, or suspension of a registration, the commission, after notice and a hearing, may impose upon the holder of the registration a fine in an amount not to exceed twenty thousand dollars ($20,000) for each offense, and order reparations and restitution to customers for each offense.
Every violation of this section or any part of any order, decision, decree, rule, direction, demand, or requirement of the commission, by any telephone corporation or person is a separate and distinct offense, and in case of a continuing violation each day’s continuance thereof shall be a separate and distinct offense.
In construing and enforcing this section relating to penalties, the act, omission, or failure of any officer, agent, or employee of any registered telephone corporation qualifying under this section acting within the scope of his or her official duties or employment, shall in every case be the act, omission, or failure of the corporation. The commission may assess interest to commence upon the day the payment is delinquent. All fines, assessments, and interest collected shall be deposited at least once each month in the General Fund.
Actions to enforce the decision of the commission ordering the payment of fines, reparations, or restitution under this section shall be brought in the name of the people of the State of California, in the superior court of the county, or city and county, in which the corporation complained of, if any, has its principal place of business, or in which the person, if any, complained of, resides or in which the commission has offices. The enforcement of a commission decision or order under this section shall be commenced and prosecuted to final judgment by the attorney of the commission.
The provisions of this section do not apply to commercial mobile radio service.
ARTICLE 2. Passenger Stage Corporations [1031. - 1046.]
No passenger stage corporation shall operate or cause to be operated any passenger stage over any public highway in this state without first having obtained from the commission a certificate declaring that public convenience and necessity require such operation, but no such certificate shall be required of any passenger stage corporation as to the fixed termini between which, or the route over which, it was actually operating in good faith on July 29, 1927, in compliance with the provisions of Chapter 213, Statutes of 1917, nor shall any such certificate be required of any person or corporation who on January 1, 1927, was operating, or during the calendar year 1926 had operated a seasonal service of not less than three consecutive months’ duration, sightseeing buses on a continuous sightseeing trip with one terminus only. Any right, privilege, franchise, or permit held, owned, or obtained by any passenger stage corporation may be sold, assigned, leased, mortgaged, transferred, inherited, or otherwise encumbered as other property, only upon authorization by the commission.
For purposes of this section, “public convenience and necessity,” as it affects applications for passenger stage corporation certificates, means that the applicant has met the criteria for issuance of a certificate specified in Section 1032.
The commission shall not issue or authorize the transfer of any certificate under this article to any person, firm, or corporation or to any officer or director of the firm, corporation, or other entity against whom a final judgment has been entered and whose name has been transmitted to the commission pursuant to Section 3716.4 of the Labor Code, unless that judgment has been satisfied or has been discharged in accordance with the bankruptcy laws of the United States.
Every applicant for a certificate or transfer of a certificate shall file in the office of the commission an application therefor in the form required by the commission. The commission may, with or without a hearing, issue the certificate as requested, or refuse to issue it, or issue it for the partial exercise only of the privilege sought, and may attach to the exercise of the rights granted by the certificate terms and conditions that, in its judgment, are required in the public interest.
Before a certificate is issued or transferred, the commission shall require the applicant to establish reasonable fitness and financial responsibility to initiate and conduct, or continue to conduct, the proposed or existing transportation services. The commission shall not issue or transfer a certificate unless the applicant meets all of the following requirements:
The applicant is financially and organizationally capable of conducting an operation that complies with the rules and regulations of the Department of the California Highway Patrol governing highway safety.
The applicant is committed to observing the hours of service regulations of state and federal law, where applicable, for all persons, whether employees or subcarriers, operating vehicles in transportation for compensation under the certificate.
The applicant has a preventive maintenance program in effect for its vehicles used in transportation for compensation that conforms to regulations of the Department of the California Highway Patrol, as described in Title 13 of the California Code of Regulations.
The applicant participates in a program to regularly check the driving records of all persons, whether employees or subcarriers, operating vehicles used in transportation for compensation requiring a class B driver’s license under the certificate.
The applicant has a safety education and training program in effect for all employees or subcarriers operating vehicles used in transportation for compensation.
The applicant agrees to maintain its vehicles used in transportation for compensation in safe operating condition and in compliance with applicable laws and regulations relative to motor vehicle safety.
The applicant has filed with the commission a certificate of workers’ compensation insurance coverage or statement required by Section 460.7.
The applicant has provided the commission an address of an office or terminal where documents supporting the factual matters specified in the showings required by this subdivision may be inspected by the commission and the Department of the California Highway Patrol.
With respect to subparagraphs (B) and (F) of paragraph (1), the commission may base its findings on a certification by the commission that an applicant has filed with it a sworn declaration of ability to comply and intent to comply.
In addition to the requirements of subdivision (b), a passenger stage corporation shall meet all other state and federal regulations, where applicable, as prescribed.
The commission may delegate to its executive director or his or her designee, the authority to issue or transfer certificates of public convenience and necessity and to make all necessary findings specified in subdivision (b).
The commission shall not issue or transfer a certificate of public convenience and necessity pursuant to this article unless the applicant provides for a mandatory controlled substance and alcohol testing certification program as adopted by the commission.
The commission, after considering any suggestions made by the Department of the California Highway Patrol, shall adopt a program that includes, but need not be limited to, all of the following requirements:
Drivers shall test negative for each of the controlled substances specified in Part 40 (commencing with Section 40.1) of Title 49 of the Code of Federal Regulations, before employment. Drivers shall test negative for these controlled substances and for alcohol at such other times as the commission, after consulting the Department of the California Highway Patrol, shall designate. As used in this section, a negative test for alcohol means an alcohol screening test showing a breath alcohol concentration of less than 0.02 percent.
Procedures shall be substantially as in Part 40 (commencing with Section 40.1) of Title 49 of the Code of Federal Regulations, except that the driver shall show a valid California driver’s license at the time and place of testing, and except as provided otherwise in this section. Requirements for rehabilitation and for return-to-duty and followup testing, and other requirements except as provided otherwise in this section, shall be substantially as in Part 382 (commencing with Section 382.101) of Title 49 of the Code of Federal Regulations.
A test for one applicant shall be accepted as meeting the same requirement for any other applicant. Any negative test result shall be accepted for one year as meeting any requirement for periodic testing for that applicant or any other applicant, if the driver has not tested positive subsequent to a negative result. However, an earlier negative result shall not be accepted as meeting the pre-employment testing requirement for any subsequent employment, or any testing requirements under the program other than periodic testing.
In the case of an applicant who is also a driver, test results shall be reported directly to the commission. In all other cases, results shall be reported directly to the applicant.
All test results are confidential and shall not be released without the consent of the driver, except as authorized or required by law.
Applicants shall be responsible for compliance with, and shall pay all costs of, this program with respect to their employees and potential employees, except that an applicant may require employees who test positive to pay the costs of rehabilitation and of return-to-duty and followup testing.
The requirements of the program do not apply to any driver required to comply with the controlled substance and alcohol use and testing requirements of Part 382 (commencing with Section 382.101) of Title 49 of the Code of Federal Regulations, or Section 34520 of the Vehicle Code, or to any driver exempted from the provisions of that section.
No evidence derived from a positive test result pursuant to the program shall be admissible in a criminal prosecution concerning unlawful possession, sale, or distribution of controlled substances.
On the request of an applicant, the commission shall give the applicant a list of consortia certified pursuant to Part 382 (commencing with Section 382.101) of Title 49 of the Code of Federal Regulations that the commission knows offer tests in California.
The commission shall conduct random and for-cause inspections of applicants’ documents supporting compliance with the program.
For purposes of this section, “employment” includes self-employment as an independent driver.
The commission shall issue a certificate pursuant to this article to every passenger stage corporation which conducts intrastate passenger transportation service pursuant to federal operating authority, to the extent that regulation of these operations is not preempted by the federal Bus Regulatory Reform Act of 1982 (P.L. 97-261), as amended. The commission may attach any conditions or limitations to the issuance of the certificate which it may specify, consistent with federal law and regulation.
The commission, in the exercise of the jurisdiction conferred upon it by the Constitution of this State and by this part, may grant certificates of public convenience and necessity, make decisions and orders, and prescribe rules affecting passenger stage corporations, notwithstanding the provisions of any ordinance or permit of any city, county, or city and county, and in case of conflict between any such order or rule and any such ordinance or permit, the certificate, decision, order, or rule of the commission shall prevail.
The commission may, at any time for good cause, suspend an operating right acquired by virtue of operations conducted on July 29, 1927, or a certificate of public convenience and necessity and, upon notice to the holder and opportunity to be heard, revoke, alter, or amend the operating right or certificate.
As an alternative to the suspension, revocation, alteration, or amendment of an operating right or certificate, the commission may impose upon the holder a fine not to exceed five thousand dollars ($5,000). The commission may assess interest upon any fine imposed, the interest to commence upon the day the payment of the fine is delinquent. All fines and interest collected shall be deposited at least once each month in the Public Utilities Commission Transportation Reimbursement Account in the General Fund.
For purposes of this section, “good cause” includes, but is not limited to, either of the following:
A consistent failure of the holder of the operating right or certificate to maintain vehicles in a safe operating condition and in compliance with the Vehicle Code and with regulations contained in Title 13 of the California Code of Regulations relative to motor vehicle safety, as shown by the records of the commission, the Department of Motor Vehicles, the Department of the California Highway Patrol, or the passenger stage corporation.
The holder’s knowing and willful filing of a false report which understates revenues and fees.
Upon receipt of a written recommendation from the Department of the California Highway Patrol that the certificate of a passenger stage corporation be suspended either (1) for failure to maintain any vehicle used in transportation for compensation in a safe operating condition or to comply with the Vehicle Code or with regulations contained in Title 13 of the California Code of Regulations relative to motor carrier safety, if that failure is either a consistent failure or presents an imminent danger to public safety, or (2) for failure to enroll all drivers in the pull notice system as required by Section 1808.1 of the Vehicle Code, the commission shall, pending a hearing in the matter pursuant to subdivision (d), suspend the corporation’s certificate. The department’s written recommendation shall specifically indicate compliance with subdivision (c).
A corporation whose certificate is suspended pursuant to subdivision (a) may obtain a reinspection of its terminal and vehicles by the department, by submitting a written request for reinstatement to the commission and paying a reinstatement fee of one hundred twenty-five dollars ($125). The commission shall deposit all reinstatement fees collected pursuant to this subdivision in the Public Utilities Commission Transportation Reimbursement Account. The commission shall forward a request for reinspection to the department which shall perform a reinspection within a reasonable time. The commission shall reinstate a corporation’s certificate suspended under subdivision (a) promptly upon receipt of a written recommendation from the department that the corporation’s safety compliance has improved to the satisfaction of the department, unless the certificate is suspended for another reason or has been revoked.
Before transmitting a recommendation pursuant to subdivision (a) to the commission, the Department of the California Highway Patrol shall notify the passenger stage corporation in writing of all of the following:
That the department has determined that the corporation’s safety record is unsatisfactory, furnishing a copy of any documentation or summary of any other evidence supporting the determination.
That the determination may result in a suspension or revocation of the corporation’s certificate by the commission.
That the corporation may request a review of the determination by the department within five days of its receipt of the notice required under this subdivision. If a review pursuant to this paragraph is requested by the corporation, the department shall conduct and evaluate that review prior to transmitting any notification to the commission pursuant to subdivision (a).
Whenever the commission suspends the certificate of any passenger stage corporation pursuant to subdivision (a), the commission shall furnish the corporation written notice of the suspension and shall hold a hearing within a reasonable time, not to exceed 21 days, after a written request therefor is filed with the commission, with a copy thereof furnished to the Department of the California Highway Patrol. At the hearing, the corporation shall show cause why the suspension should not be continued. At the conclusion of the hearing, the commission may, in addition to any other applicable penalty provided in this part, terminate the suspension, continue the suspension in effect, or revoke the certificate. The commission may revoke the certificate of any passenger stage corporation suspended pursuant to subdivision (a) at any time 90 days or more after its suspension if the commission has not received a written recommendation for reinstatement from the department and the corporation has not filed a written request for a hearing with the commission.
If the commission, after a hearing, finds that a passenger stage corporation has continued to operate as such after its certificate has been suspended pursuant to subdivision (a), the commission shall do one of the following:
Revoke the certificate of the corporation.
Impose upon the holder of the certificate a civil penalty of not less than one thousand dollars ($1,000) nor more than five thousand dollars ($5,000) for each day of unlawful operations.
Upon receipt of a stop order issued by the Director of Industrial Relations pursuant to Section 3710.1 of the Labor Code, the commission shall investigate to determine whether the passenger stage corporation has filed a false statement relative to workers’ compensation insurance coverage, in violation of statute, or rules or orders of the commission. If, after notice and opportunity to be heard, the commission determines that there has been a violation of statute, or rules or orders of the commission, the commission shall impose appropriate penalties, which may include a fine and suspension of operating authority for a violation.
Upon receipt of a complaint from the Director of Industrial Relations that a final judgment has been entered against any passenger stage corporation as a result of an award having been made to an employee pursuant to Section 3716.2 of the Labor Code, the commission shall, 30 days from the date notice to the corporation is mailed, revoke the corporation’s certificate of public convenience and necessity, unless the judgment has been satisfied or has been discharged in accordance with the bankruptcy laws of the United States or the corporation requests a hearing pursuant to subdivision (c).
Within seven days of receipt of a complaint from the Director of Industrial Relations that a final judgment has been entered against any passenger stage corporation as a result of an award having been made to an employee pursuant to Section 3716.2 of the Labor Code, the commission shall furnish to the corporation named in the final judgment written notice of the right to a hearing regarding the complaint and the procedure to follow to request a hearing. The notice shall state that the commission is required to revoke the corporation’s certificate of public convenience and necessity to operate pursuant to subdivision (b) after 30 days from the date the notice is mailed unless the corporation provides proof that the judgment is satisfied or has been discharged in accordance with the bankruptcy laws of the United States and the commission has been so notified seven days prior to the conclusion of the 30-day waiting period. The notice shall also inform the corporation of a right to a hearing and the procedures to follow to request a hearing. The corporation may request a hearing within 10 days from the date the notice is sent by the commission. The request for the hearing shall stay the revocation. The hearing shall be held within 30 days of the receipt of the request. If the commission finds that an unsatisfied judgment exists concerning a debt arising under Section 3717 of the Labor Code, the commission shall immediately revoke the corporation’s certificate of public convenience and necessity.
When a complaint has been filed with the commission alleging that any passenger stage is being operated without a certificate of public convenience and necessity, contrary to or in violation of the provisions of this part, the commission may, with or without notice, make its order requiring the corporation or person operating or managing such passenger stage, to cease and desist from such operation, until the commission makes and files its decision on the complaint, or until further order of the commission.
Every corporation or person who knowingly and willfully issues, publishes, or affixes, or causes or permits the issuance, publishing, or affixing, of any oral or written advertisement, broadcast, or other holding out to the public, or any portion thereof, that the corporation or person is in operation as a passenger stage corporation without having a valid certificate or issued under this article is guilty of a misdemeanor punishable, if an individual, by a fine of not more than one thousand dollars ($1,000) or by imprisonment in the county jail for not more than six months, or by both, or, if a corporation, by a fine of not more than five thousand dollars ($5,000).
Whether or not any stage, auto stage, or other motor vehicle is being, or is proposed to be operated as a passenger stage corporation “between fixed termini or over a regular route” within the meaning of this part is a question of fact, and the finding of the commission thereon is final and is not subject to review. Any act of transporting or attempting to transport any person or persons by stage, auto stage, or other motor vehicle upon a public highway of this State between two or more points not both within the limits of a single city or city and county, where the rate, charge, or fare for such transportation is computed, collected, or demanded on an individual fare basis, shall be presumed to be an act of operating as a passenger stage corporation within the meaning of this part.
Each application for a certificate of public convenience and necessity made under this article shall be accompanied by a fee of five hundred dollars ($500), unless the applicant is already operating in the immediate vicinity under the jurisdiction of the commission.
No certificate issued pursuant to, or rights to conduct any of the services authorized by, this article shall be sold, leased, or assigned, or otherwise transferred or encumbered, unless authorized by the commission. A filing fee of three hundred dollars ($300) shall accompany all applications for that authorization.
Every passenger stage corporation which violates any provision of this article, or aids or abets, or without being present advises or encourages any person or corporation in such violation, is guilty of a misdemeanor and, upon conviction thereof, if a person, shall be punished by a fine not exceeding one thousand dollars ($1,000) or by imprisonment in a county jail for a term not to exceed six months, or by both such fine and imprisonment, or, if a corporation, shall be punished by a fine not to exceed one thousand dollars ($1,000).
The interior of every passenger stage operated for hire in this State shall be maintained in a clean and sanitary condition.
A passenger stage corporation shall not operate any motor vehicle on a public highway unless there is displayed on the vehicle a distinctive identifying symbol in the form prescribed by the commission, showing the classification to which the vehicle belongs. The identifying symbol shall not be displayed until a certificate of public convenience and necessity has been issued under this chapter for the operation.
The identifying symbol displayed by a passenger stage corporation subject to the Interstate Commerce Commission shall serve in lieu of the display requirements of this section.
In every written or oral advertisement of the service it offers, every passenger stage corporation shall state the number of its certificate or identifying symbol, as specified by the commission.
The commission shall, in issuing a certificate pursuant to this article, require the passenger stage corporation to procure, and to continue in effect during the life of the certificate, adequate protection against liability imposed by law upon the corporation for the payment of damages for personal bodily injuries, including death resulting therefrom, protection against a total liability of the corporation on account of bodily injuries to, or death of, more than one person as a result of any one accident, and protection against damage or destruction of property.
The minimum requirements for these assurances of protection against liability shall not be less than the requirements which are applicable to operations of carriers conducted pursuant to the federal Bus Regulatory Reform Act of 1982 (P.L. 97-261), as amended. However, for vehicles designed to carry not more than eight persons, including the driver, the commission shall not require protection against a total liability of the corporation on account of bodily injuries to, or death of, more than one person as a result of any one accident in an amount exceeding seven hundred fifty thousand dollars ($750,000).
It is unlawful for the owner of a passenger stage employing or otherwise directing the driver of the passenger stage to permit the operation of the passenger stage upon any public highway for compensation without first having obtained from the commission a certificate pursuant to this chapter or without first having complied with the vehicle identification requirements of Section 1038.5 or the accident liability protection requirements of Section 1040.
Every passenger stage corporation shall furnish the commission annually with a list, prepared under oath, of all vehicles used in transportation for compensation during the preceding year. This list shall include and identify each modified limousine and the terminal location of each modified limousine. The commission shall furnish a copy of this list identifying each modified limousine and its terminal location to the Department of the California Highway Patrol. The commission shall also furnish a copy of this list to the corporation’s insurer, if the corporation’s accident liability protection is provided by a policy or policies of insurance.
The commission shall not issue or continue in effect any permit, certificate, or authority of a passenger stage corporation that has not submitted fees required for inspection pursuant to Section 34500.4 of the Vehicle Code and any associated penalties, if applicable.
If the passenger stage corporation’s insurer informs the commission that the corporation has failed to obtain insurance coverage for any vehicle reported on the list, the commission may, in addition to any other applicable penalty provided in this part, for a first occurrence, suspend the corporation’s certificate or impose a fine, or both, and for a second or subsequent occurrence may suspend or revoke the certificate or impose a fine, or both.
As used in this section and Section 1042.1, “modified limousine” means any vehicle that has been modified, altered, or extended in a manner that increases the overall wheelbase of the vehicle, exceeding the original equipment manufacturer’s published wheelbase dimension for the base model and year of the vehicle, in any amount sufficient to accommodate additional passengers with a seating capacity of not more than 10 passengers including the driver, and is used in the transportation of passengers for hire. For purposes of this subdivision, “wheelbase” means the longitudinal distance between the vertical centerlines of the front and rear wheels.
Not later than January 1, 2015, the commission shall provide the Department of the California Highway Patrol with a list of each passenger stage corporation’s modified limousines and their terminal locations in order for the department to promulgate regulations pursuant to Section 34500.4 of the Vehicle Code.
Every passenger stage corporation earning over three hundred fifty thousand dollars ($350,000) in annual gross operating revenue shall, under oath, file annually a report indicating the number, classification, and compensation of all employees and owner-operator drivers hired or engaged during the reporting period. The commission shall submit a copy of the report to the administrator of the corporation’s workers’ compensation self-insurance plan if the corporation is self-insured, or to the corporation’s workers’ compensation insurer if the corporation’s workers’ compensation protection is provided by a policy or policies of insurance. The commission shall not be obligated to undertake an independent investigation of the adequacy of workers’ compensation insurance coverage based on the information contained in the report if the carrier has complied with Section 460.7.
When the executive director of the commission determines that any passenger stage corporation, or any officer, director, or agent of any passenger stage corporation, has engaged in, is engaged in, or is about to engage in, any acts or practices in violation of this chapter, or any order, decision, rule, regulation, direction, demand, or requirement issued under this chapter, the executive director may make application to the superior court for an order enjoining those acts or practices or for an order directing compliance. The court may grant a permanent or temporary injunction, restraining order, or other order, including, but not limited to, an order allowing vehicles used for subsequent operations subject to the order to be impounded at the carrier’s expense and subject to release only by subsequent court order following a petition to the court by the defendant or owner of the vehicle, upon a showing by the executive director that a person or corporation has engaged in or is about to engage in these acts or practices. The commission may contract with the Department of the California Highway Patrol or a sheriff to assist in enforcement of an order for vehicle impound. Any costs incurred by the commission for that assistance are not assignable to the carrier as an expense of impound.
After the cancellation or revocation of a certificate, or during the period of its suspension, it is unlawful for a passenger stage corporation to conduct any operations as a carrier. The commission may either grant or deny an application for a new certificate whenever it appears that a prior certificate of the applicant has been canceled or revoked pursuant to Section 1033.5 or whenever it appears, after hearing, that as a prior certificate holder, the applicant engaged in any of the unlawful activities set forth in Section 1033.5 for which his or her certificate might have been canceled or revoked.
For purposes of this section, the following terms have the following meanings:
“Bus” means a vehicle designed, used, or maintained for carrying more than 10 persons, including the driver, which is used to transport persons for compensation or profit.
“Limousine” means any sedan or sport utility vehicle, of either standard or extended length, with a seating capacity of not more than 10 passengers including the driver, used in the transportation of passengers for hire on a prearranged basis within this state, and includes a modified limousine as defined in subdivision (d) of Section 1042.
“Peace officer” means a person who is designated as a peace officer pursuant to Chapter 4.5 (commencing with Section 830) of Title 3 of Part 2 of the Penal Code.
A peace officer may, with respect to a passenger stage corporation, enforce and assist in the enforcement of Sections 2110 and 2112, resulting from a violation of Section 1031, 1041, or 1045, or more than one of those sections. A peace officer may additionally enforce and assist in the enforcement of Sections 1034.5 and 2119. In any case in which an arrest authorized by this subdivision is made for an offense declared to be a misdemeanor, and the person arrested does not demand to be taken before a magistrate, the arresting peace officer may, instead of taking such person before a magistrate, follow the procedure prescribed by Chapter 5C (commencing with Section 853.5) of Title 3 of Part 2 of the Penal Code. The provisions of that chapter shall thereafter apply with reference to any proceeding based upon the issuance of a citation pursuant to this authority.
A peace officer may impound a bus or limousine operated by a passenger stage corporation pursuant to Section 14602.9 of the Vehicle Code if the peace officer determines that any of the following violations occurred while the driver was operating the vehicle:
The driver was operating the bus or limousine when the passenger stage corporation did not have a certificate of public convenience and necessity issued by the commission as required pursuant to this article.
The driver was operating the bus or limousine without having a current and valid driver’s license of the proper class.
The commission shall coordinate enforcement of this section with those peace officers likely to be involved in enforcing this section, including undertaking both of the following:
The Legislature finds and declares that this section is intended to facilitate and enhance the commission’s performance of its functions pursuant to Section 2101 and not diminish the commission’s authority or responsibility pursuant to that section.
This section does not authorize the impoundment of privately owned personal vehicles that are not common carriers nor the impoundment of vehicles used in transportation for compensation by charter-party carriers of passengers that are not required to carry individual permits.
ARTICLE 5. Electrical and Gas Corporations [1091. - 1103.]
In addition to the requirements of Article 1 (commencing with Section 1001) and any other provision of law, every electrical and every gas corporation proposing to construct or modify any electric or gas plant within the state, or line, or extension, which will in the case of an electrical plant, line, or extension add generating capacity in excess of 50 megawatts, or in the case of a gas plant, line, or extension cost in excess of fifty million dollars ($50,000,000), or proposing to construct any electric or gas plant out-of-state of which at least twenty-five percent (25%) of the costs will be borne by the corporation, shall comply with this article.
Whenever application is made to the commission for certification of an electric or gas plant, line, or extension subject to this article, the commission shall appoint a construction project board of consultants to evaluate the design, construction, project management, and economic soundness of the proposed plant, line, or extension, if the commission determines that a significant potential exists for the occurrence of problems in any of the areas for which an electrical or gas corporation is required to submit information pursuant to Section 1003 or 1003.5. The extent of the board’s evaluation shall be determined by the commission. The board may, upon approval of the commission, employ staff independent of the commission staff to carry out its functions under this article. The board may, upon approval of the commission, undertake special studies addressing potential problem areas identified by the board.
The construction project board of consultants shall consist of eminently qualified and highly experienced design, construction, and project management economic specialists who can, as a group or as individuals, independently and objectively address the full scope of design, construction, and project management and economic evaluations requested by the commission.
No member of the construction project board of consultants shall have a current financial interest in, or receive any significant amount of his or her annual compensation for consulting services in his or her area of special expertise from, any corporation or person which has a financial interest in the project. The commission shall define financial interest and significant amount of annual compensation for purposes of this subdivision. Any person considered for appointment to the board shall disclose to the commission any interests in the project or in any corporation or person with a financial interest in the project and any compensation received for consulting services which may constitute a prohibited financial interest.
Notwithstanding subdivision (b), a person appointed by the Federal Energy Regulatory Commission as a member of a board of consultants for the construction of a hydroelectric generation facility or related transmission line who receives compensation from an electrical corporation constructing that facility or line as a member of that board of consultants is not disqualified from an appointment to a construction project board of consultants pursuant to Section 1092.
The members of the construction project board of consultants shall receive fees and expenses from the commission. The corporation whose project the construction project board of consultants is evaluating shall, upon demand of the commission, reimburse the commission for the amount expended by the commission for the fees and other expenses of the board, including, but not limited to, special studies, staff, or commission staff costs directly attributable to activities of the construction project board of consultants.
The commission shall deposit all money received pursuant to this section at least once each month in the Certification Fund, which is hereby created in the State Treasury. The money in the Certification Fund is hereby continuously appropriated to the commission in augmentation of any other appropriation for the support of the board.
The commission may allow the inclusion of any amounts received from an electrical or gas corporation pursuant to this section as an authorized expense for purposes of establishing rates.
The corporation shall provide the construction project board of consultants with all information the board determines necessary for its evaluation of the project. The corporation shall provide information regarding problems and uncertainties which have been encountered during the planning, design, and development of the project.
The construction project board of consultants shall evaluate the design, construction, project management, and economic soundness of the project as directed by the commission, and submit an appropriate written report of its findings and recommendations to the commission and the corporation prior to the commission’s issuance of a certificate. The members of the board may provide testimony before the commission in formal or informal hearings on the project.
For purposes of assisting the construction project board of consultants in monitoring project construction, the corporation shall submit the current design, estimate of project costs, implementation schedule, and draft construction contracts to the commission and the construction project board of consultants before awarding any major construction contract. The corporation shall inform the commission and the board of all bid quotations and any significant exceptions which the bidders may have taken to the corporation’s engineering designs, specifications, and draft contracts.
The examination by the commission and the construction project board of consultants of documents furnished pursuant to this section shall be conducted so as not to unreasonably delay the contracts, bidding, and awards process.
Throughout the design and construction process, the corporation shall submit quarterly progress reports to the commission and the construction project board of consultants on the status of the project. The corporation shall provide complete information on any major problems and deviations in the areas for which an electrical or gas corporation is required to submit information pursuant to Section 1003 or 1003.5.
The corporation shall provide the commission and the board with reports each month containing the following information for each of the major cost categories within the project and for the project as a whole:
The original estimated costs as of the time of certification.
The actual costs to date.
The percentage of the work completed to date.
The estimated costs to completion.
The costs associated with changes made by regulatory bodies to the scope or design of the project.
If the actual costs to date or the estimated costs to completion for any major cost category, or the project as a whole, exceed the original estimated costs by 10 percent, the corporation shall advise the board and the commission of this fact, and provide the commission and the board with an explanation and a proposal for corrective action. The commission shall consult with the board in determining whether to order corrective action. The board shall submit quarterly reports to the commission and to the corporation if it determines that a potential for major problems exists.
Upon completion of the project and commencement of operations, the construction project board of consultants shall submit a final report of its findings and recommendations to the commission and the corporation.
The commission and the corporation shall give full consideration to all reports, findings, and recommendations of the construction project board of consultants and provide a public response in writing within 45 days after receiving the reports, findings, and recommendations. Copies of the written reports of the board containing its findings and recommendations shall be made available to the public, at cost, at the same time that the reports are issued to the commission and the corporation. The public shall have 45 days from the date of issuance to respond, in writing, to the commission on the reports.
No provision of this article shall be construed to relieve an electrical or gas corporation of any responsibility for the construction or modification of any electric or gas plant including ultimate costs, cost control mechanisms, schedules, and completion dates. Members of the construction project board of consultants, individually or as a group, shall assume no responsibility for the design, construction, project management, or any other part of a plant construction or modification project.
Notwithstanding any other provision of this article, and in addition to the requirements of Article 1 (commencing with Section 1001), an electrical corporation proposing to construct an electrical transmission line to the northwestern United States shall provide the commission with sufficient reliable information to enable the commission to determine that the proposed line, at the electric rates expected to prevail over the useful life of the line, will be cost effective. The commission, in its analysis of the forecast cost of electricity, shall take into consideration the recent increases in the charges for purchasing surplus electricity from the northwestern United States, the possibility of future increases in those charges, the feasibility of negotiating long-term contracts under reasonable charges, and the feasibility of purchasing electricity directly from Canada rather than through the Bonneville Power Administration.
The commission shall not issue a certificate of public convenience and necessity unless it is satisfied that the electrical corporation has provided the information described in subdivision (a).
If a new underground gas storage facility is proposed, the commission shall ensure that a risk assessment evaluating the potential impact of a leak from the facility on public and environmental health, safety, and welfare is conducted by the project proponent. Both acute and chronic exposures from a range of expected emissions and emission rates shall be evaluated. The evaluation shall include consideration of population density in proximal communities, environmentally sensitive areas, emergency response times, evacuation times, possible leak duration, possible chemical species emitted, and local meteorology.
In evaluating the potential risks and impacts of acute and chronic exposures from emissions from a proposed new gas storage facility, the project proponent shall assess or cause to be assessed risks associated with the proposed facility’s proximity to any living quarters, including private homes, condominiums, apartments, retirement homes, prisons, dormitories, or other housing; education resources, including preschools and schools operating kindergarten or any of grades 1 to 12, inclusive; day care centers; and health care facilities, including hospitals, nursing homes, and long-term care and hospice facilities. Based on the risk analysis, appropriate setbacks to the listed structure types shall be determined by the commission.
The risk assessment conducted pursuant to this section shall be subjected to peer review by independent experts whose demonstrated expertise includes, but is not limited to, the fields of public health, epidemiology, and toxicology.
The findings of any risk assessment required by this section shall be reported pursuant to Section 911.2.
CHAPTER 6. Railroad Crossings [1201. - 1220.]
No public road, highway, or street shall be constructed across the track of any railroad corporation at grade, nor shall the track of any railroad corporation be constructed across a public road, highway, or street at grade, or shall the track of any railroad corporation be constructed across the track of any other railroad or street railroad corporation at grade, nor shall the track of a street railroad corporation be constructed across the track of a railroad corporation at grade, without having first secured the permission of the commission. This section shall not apply to the replacement of lawfully existing tracks. The commission may refuse its permission or grant it upon such terms and conditions as it prescribes.
The commission, in consultation with the Department of Transportation, shall adopt rules and regulations prescribing uniform standards regarding the time after the warning signal begins at a railroad crossing at which traffic enforcement shall begin, after public hearings and consultation with transit districts or transportation commissions and multicounty rail transit entities established under Division 12 (commencing with Section 130000), that provide rail transportation.
A description of the location of the proposed crossing and plans of suitable scale that show all of the features of the crossing, including, but not limited to, streets, roads, tracks, and safety devices, and the location of any buildings, structures, or obstructions in the vicinity of the proposed crossing.
A map of suitable scale (1,000 to 3,000 feet per inch) showing the relation of the proposed crossing to existing roads and railroads in the general vicinity of the proposed crossing.
A profile showing the ground line and grade line and rate of grades of approach on all highways and railroads affected by the proposed crossing.
A copy of the franchise or permit that allows the railroad to cross the public road, highway, or street involved, if so required, from the authority having jurisdiction.
The commission has the exclusive power:
To determine and prescribe the manner, including the particular point of crossing, and the terms of installation, operation, maintenance, use, and protection of each crossing of one railroad by another railroad or street railroad, of a street railroad by a railroad, of each crossing of a public or publicly used road or highway by a railroad or street railroad, and of a street by a railroad or of a railroad by a street.
To alter, relocate, or abolish by physical closing any crossing set forth in subdivision (a).
To require, where in its judgment it would be practicable, a separation of grades at any crossing established and to prescribe the terms upon which the separation shall be made and the proportions in which the expense of the construction, alteration, relocation, or abolition of crossings or the separation of grades shall be divided between the railroad or street railroad corporations affected or between these corporations and the state, county, city, or other political subdivision affected.
To authorize on an application-by-application basis and supervise the operation of pilot projects to evaluate proposed crossing warning devices, new technology, or other additional safety measures at designated crossings, with the consent of the local jurisdiction, the affected railroad, and other interested parties, including, but not limited to, represented railroad employees.
To the extent permitted by federal law or regulation, the commission shall develop and implement a pilot or limited demonstration and research project for colored pavement markings at one or more at-grade highway-railroad crossings no later than January 1, 2026, to measure and evaluate the effectiveness of such a project to reduce incidents. The commission shall report its findings to the Legislature no later than one year after project completion, in compliance with Section 9795 of the Government Code.
This section shall remain in effect only until January 1, 2030, and as of that date is repealed.
In any proceeding under Section 1202, where the application to the commission states that the parties are not in agreement as to apportionment of costs, but the applicant is willing to advance the amount of money reasonably necessary to enable the respondent to complete the work to be done by it, the commission shall set the application for hearing as soon as its calendar permits on all of the following questions:
The necessity for the project.
The approval of the location and the engineering plans, including provisions for handling traffic during construction and the work to be performed by each party.
The sum to be advanced by the applicant for the work to be done by the respondent. The commission shall render as promptly as possible an interim decision effective within 20 days on the questions, reserving for a later hearing and decision the question of apportionment of costs. The decision shall also order the respondent to proceed upon receipt of the sum to be advanced by the applicant without delay to perform the work to be done by the respondent, integrating the work with that of the applicant or its contractor in such manner that neither will unreasonably obstruct or delay the work of the other, to the end that the people of the state may have the use of the project at the earliest possible date.
In the event of the failure or refusal of the respondent to grant a right of entry to permit the applicant to proceed with the work to be performed by it or its contractor, the applicant may, pursuant to Section 19 of Article I of the Constitution, obtain an order of immediate possession in a court of competent jurisdiction if a condemnation action has previously been filed in that court, or file the action and obtain an order of immediate possession in the event the action has not previously been filed. Upon obtaining the order, the applicant may proceed in the same manner as if a right of entry had been granted, and the respondent shall proceed with its own work and integrate it with that of the applicant or its contractor.
In the final decision apportioning costs, the commission shall credit the sum advanced by the applicant against the applicant’s share of the costs. In the final decision, the commission shall also credit against the applicant’s share of the costs any increases in those costs found by the commission to be directly attributable to the respondent’s willful failure or refusal, after the effective date of the interim decision, to proceed with its own work or to integrate its work with that of the applicant or its contractor.
In apportioning the cost of maintenance of automatic grade-crossing protection constructed or altered after October 1, 1965 under Section 1202, as between the railroad or street railroad corporations and the public agencies affected, the commission shall divide such maintenance cost in the same proportion as the cost of constructing such automatic grade-crossing protection is divided. The liability of cities, counties and cities and counties to pay the share of maintenance costs assigned to such local agencies by the commission shall be limited to funds set aside for allocation to the commission pursuant to Section 1231.1. The railroad or street railroad corporations and the public agencies affected may agree on a different division of maintenance costs. If the public agency affected agrees to assume a greater proportion of the cost of maintenance than the apportionment of the cost of construction, the difference shall be paid by the public agency from funds other than the State Highway Fund or any other state fund.
Notwithstanding any other provision of this chapter, in any proceeding under Section 1202, in the case of a crossing involving a publicly used road or highway not on a publicly maintained road system, the commission may apportion expense for improvements to the county in the case of unincorporated territory, city or other political subdivision if the commission finds (a) that the owner or owners of private property served by such publicly used crossing agree to expressly dedicate and improve, and the affected public agency agrees to accept, a right-of-way or roadway over such property for a reasonable distance from such crossing as determined by the commission, or (b) that a judicial determination of implied dedication of such road or highway over the railroad right-of-way to public use, based on public user in the manner and for the time required by law, has taken place.
If neither of these conditions is found to exist, the commission shall order the crossing abolished by physical closing.
In no event shall a railroad be required to bear costs for the improvement of a publicly used crossing in excess of what it would be required to bear in connection with the improvement of a public street or highway crossing.
If a city or county develops and adopts, by resolution upon a majority vote of the city council or the board of supervisors, a plan to improve mobility for multimodal access that calls for new or modified railroad crossings, the commission shall make an engineer available from the Rail Crossings and Engineering Branch to assist and advise that city or county on the safety of the planned railroad crossings before the filing of an application to the commission for the approval of the new or modified railroad crossings.
In prescribing the proportions in which the expense of construction, reconstruction, alteration, or relocation of grade separations shall be divided between railroad or street railroad corporations and public agencies, in proceedings under Section 1202, the commission, unless otherwise provided in this section, shall be governed by the following standards:
Where a grade separation project, whether initiated by a public agency or a railroad, will not result in the elimination of an existing grade crossing, located at or within a reasonable distance from the point of crossing of the grade separation, the commission shall require the public agency or railroad applying for authorization to construct such grade separation to pay the entire cost.
Where a grade separation project initiated by a public agency will directly result in the elimination of one or more existing grade crossings, located at or within a reasonable distance from the point of crossing of the grade separation, the commission shall apportion against the railroad 10 percent of the cost of the project. The remainder of such costs shall be apportioned against the public agency or agencies affected by such grade separation.
Where a grade separation project initiated by a railroad will directly result in the elimination of an existing grade crossing, located at or within a reasonable distance from the point of crossing of the grade separation, the commission shall apportion 10 percent of the cost, attributable to the presence of the highway facilities, against the public agency or agencies affected by the project, and the remainder thereof to the railroad or railroads applying for authorization to construct such grade separation.
Where the project consists of an alteration or reconstruction of an existing grade separation for the purpose of increasing the capacity of the structure for highway purposes, the commission shall apportion 10 percent of the cost against the railroad and the balance against the public agency or agencies affected by the grade separation. There shall be no apportionment of cost to the railroad if it did not bear any of the cost of the original project, in which case the public agency or agencies shall pay 100 percent of the cost of the alteration or reconstruction of the grade separation. An allocation of funds set aside pursuant to Section 190 of the Streets and Highways Code may be made for such a project notwithstanding subdivision (d) of Section 2454 of the Streets and Highways Code.
Where the project consists of an alteration or reconstruction of an existing grade separation for the purpose of increasing the capacity of the structure for railway purposes, the commission shall apportion 10 percent of the cost against the public agency or agencies affected and the balance against the railroad applying for authorization to alter or reconstruct the grade separation. There shall be no apportionment of cost to the public agency or agencies if the agency or agencies did not bear any of the cost of the original project, in which case the railroad shall pay 100 percent of the cost of the alteration or reconstruction of the grade separation.
In the event the commission finds that a particular project does not clearly fall within the provisions of any one of the above categories, the commission shall make a specific finding of fact on the relation of the project to each of the categories, and in apportioning the costs, it shall assess against the railroad a reasonable percentage, if any, of the cost not exceeding the percentage specified in subdivision (b), dependent on the findings of the commission with respect to the relation of the project to each category. The remainder of such cost shall be apportioned against the public agency or agencies affected by the project.
In the event the commission finds that the respective shares of any apportionment should be divided between two or more railroads or two or more public agencies, the commission, to the extent that it has jurisdiction to do so in a particular proceeding before it, shall divide the shares between the railroads or the public agencies, or both, on any reasonable basis, to be decided by the commission, but in so doing shall follow the standards hereinabove prescribed for apportionment between railroads and public agencies, respectively.
The standards herein prescribed for apportionment of costs of grade separations shall not be applicable where federal funds are used. On such projects, the apportionments shall be in accordance with federal law and the rules, regulations, and orders of the federal agency administering such law, where applicable.
No provision of this section or of the Public Utilities Code shall be construed as in any way limiting the right of public agencies or railroads to negotiate agreements apportioning costs of grade separations, and the validity of any and all such agreements is hereby recognized for all purposes regardless whether the method of apportionment prescribed therein conforms to the standards hereinabove prescribed.
As used in this section “public agency” includes a separation of grade district, as well as the state, a county, city, or other political subdivision.
Any municipal corporation, transit district, rapid transit district, or other public entity which provides rail passenger transportation services through a contract with a railroad corporation, may pay all or part of the share of a grade separation project allocated to such railroad corporation, or all or part of such share of a project’s cost negotiated and agreed upon as the railroad’s share by the railroad and a public agency or agencies pursuant to subdivision (h) of Section 1202.5. In any case where the municipal corporation, transit district, rapid transit district, or other public entity agrees to pay all or part of the railroad’s share, it may enter into the negotiations allocating costs and may be a party to the agreement assessing such costs.
Whenever existing automatic grade-crossing safety signal equipment that was installed within the previous 10 years is planned for removal due to upgrade or closure projects undertaken pursuant to Section 130 of Title 23 of the United States Code, and the commission determines that it will meet the same performance criteria and inspection standards as new equipment and therefore be safe to use, the signal equipment shall be made available to the following:
With the consent of the participating railroad, to a state agency designated by the commission, for storage and potential use at a railroad crossing currently nominated by the commission for funding to eliminate hazards of railway-highway crossings pursuant to Section 130 of Title 23 of the United States Code.
To other railroads for use at other railway-highway crossings within the state.
Each corporation and political subdivision to which any of the expense is apportioned shall pay from the funds available therefor in its treasury the amount apportioned to it at the time and to the parties specified by the order of the commission. If that amount is not so paid the corporation or political subdivision entitled thereto under the order may sue therefor in any court of competent jurisdiction. If no such funds are available the appropriate boards, officers, and employees intrusted with the levy and collection of the taxes or assessments of such political subdivision shall do all acts necessary to include in the next succeeding tax or assessment levy the amount due and shall collect that amount, whereupon the amount due shall be paid in accordance with the commission’s order. The commission may by order designate the State, certain of the corporations, and political subdivisions affected, to do all or specified portions of the acts required by any order of the commission made under the provisions of Sections 1202 to 1205, inclusive, and may prescribe the manner and the time within which the parties so designated shall be paid or reimbursed by the other corporations, the State, and political subdivisions among which the expense of the work has been apportioned by the commission.
If the legislative body of the political subdivision determines that special benefits will accrue from the separation of grades to one or more districts within the political subdivision, and has made a finding to that effect and that the cost thereof, other than the portion to be paid by the railroad, interurban railroad, or street railroad involved, should be paid by such district or partly by the district and partly by the political subdivision, the commission may provide that such proportion of the total cost of the separation of grades, including the acquisition of property and the damage to property or an interest therein, as is not payable by the owners of the railroad, interurban railroad, or street railroad involved, may be assessed upon the district or that a part thereof may be paid by the district and a part by the political subdivision in accordance with the finding of the legislative body of the latter. The commission may provide that the physical work of making the grade separation as well as the proceedings for letting contracts therefor, collecting and enforcing the assessments, and making payment for damages and for the acquisition of property shall be done through the agency of the political subdivision in accordance with law. The order of the commission shall authorize the officers of the political subdivision to enter upon so much of the right of way of the railroad, interurban railroad, or street railroad as is necessary to effect the physical grade separation.
If any order of the commission provides for the payment of a portion of the cost of any such grade separation by a political subdivision without authorizing the assessment of all or any part thereof upon a benefited district, the legislative body of the political subdivision may at any time thereafter apply to the commission to have the order modified in accordance with any finding made by the legislative body, and the commission may thereupon make a new or modified order in the same manner as if such application had been made to it before the making of the order.
The commission, upon initiating a ratesetting proceeding, shall determine whether the proceeding is an exempt railroad crossing application. If the application is deemed an exempt railroad crossing application, the commission shall issue a proposed resolution with an expedited review and approval process pursuant to subdivisions (b) and (c).
Before exempting any applications pursuant to subdivision (a), the commission shall adopt an expedited review and approval process for exempt railroad crossing applications at a voting meeting after considering input from stakeholders and other public comments.
The process adopted by the commission pursuant to subdivision (b) shall, at minimum, require public notice of the application and service of the application to relevant stakeholders, including, but not limited to, railroads, rail transit agencies, and local authorities, including county and regional transportation authorities. The resolution of an exempt railroad crossing application shall be publicly noticed on the commission’s voting agenda and be subject to public comment.
For purposes of this section, “exempt railroad crossing application” means a railroad application submitted pursuant to Sections 1201 to 1205, inclusive, with clear public benefit, without valid protest objecting, in whole or in part, to the application, and where the commission determines there is no need for an evidentiary hearing or a more comprehensive review.
The commission may fix the just compensation to be paid for property or any interest in or to property to be taken or damaged in the separation of grades at any crossing specified in Section 1202, or for property or any interest in or to property to be taken or damaged in the construction, alteration, or relocation, under the order or with the approval of the commission, of elevated tracks or subways for any railroad or street railroad over or under any public road, street, highway, or private right-of-way, or of any public road, street, or highway over or under the tracks of any railroad corporation or street railroad corporation, and upon the payment of the compensation so fixed may make a final order of condemnation.
Proceedings under Section 1206 may be commenced by order on the commission’s own motion or by a petition filed by the State, county, city and county, city, political subdivision, railroad corporation, or street railroad corporation affected. Any such proceeding may be made a part of any proceeding commenced under Sections 1202 to 1205, inclusive.
The petition shall set forth the name and interest of the petitioner. The order on the commission’s own motion and the petition shall set forth (a) a statement of the purpose of the proceedings and the use for which property or interest in or to property is sought to be taken, (b) a decription of each piece of land or other property or interest in or to property sought to be taken, and whether it includes the whole or only a part of an entire parcel or tract or piece of property or interest in or to property, and (c) the names and addresses of all owners and claimants thereof, if known, or a statement that they are unknown, and a statement of each railroad corporation, the State and political subdivision which in the opinion of the commission or the petitioner has an interest in the proceeding.
The petition shall pray (a) that the commission fix the just compensation to be paid for the acquisition of or damage to the property and interest in or to property specified in the petition, (b) that the commission designate the party or parties to the proceeding who shall pay such compensation and the owners and claimants of the property and interest in or to property condemned to whom such compensation shall be paid, and (c) that the commission make its final order of condemnation. When the proceeding is commenced by order on the commission’s own motion such matters shall be included in the statement of the purpose of the proceeding.
The petition shall be verified. At the time it is filed with the commission the petitioner shall also file additional copies thereof equal in number to three more than the number of owners and claimants named in the petition.
Upon the filing of the petition or the making of the order on the commission’s own motion, the commission shall make its order to show cause. The order shall (a) specify the nature of the proceeding, (b) contain a general description of the property and interest to be condemned, and (c) direct the owners and claimants and the railroad corporations, street railroad corporations, and governmental authorities in interest named in the petition or order on the commission’s own motion, who shall also be named in the order to show cause, to appear before the commission at a time and place specified in the order, to show cause, if any they have, why the commission should not proceed after hearing to fix the just compensation to be paid for the acquisition of or damages to the specified property and interest, to designate the party or parties to the proceeding who shall pay such compensation and the owners and claimants to whom such compensation shall be paid, and to make its final order of condemnation.
The order to show cause shall direct the secretary of the commission to serve or cause to be served upon each owner and claimant, railroad corporation, street railroad corporation, and governmental authority in interest a copy of the order certified under the seal of the commission to which shall be attached a copy of the petition or order on the commission’s own motion.
When the proceeding is commenced by order on the commission’s own motion the order to show cause may be incorporated in the order on the commission’s own motion.
Personal service shall be made in accordance with the provisions of the Code of Civil Procedure or by depositing a copy of the order to show cause certified under seal of the commission with a copy of the petition or order on the commission’s own motion attached thereto or made a part thereof in the United States mail, enclosed in a sealed envelope, registered, with postage prepaid, addressed to the party to be served.
If any owner or claimant named in the petition or order on the commission’s own motion resides out of the State or has departed from the State or cannot after due diligence be found within the State, or conceals himself to avoid service, or is a corporation having no managing or business agent, cashier or secretary or other officer upon whom summons may be served, who, after due diligence, can be found within the State, and the fact appears by affidavit to the satisfaction of the commission, and it also appears by such affidavit or by the petition or order on the commission’s own motion that a cause of action exists against such owner or claimant on whom service is to be made and that he is a necessary or proper party to the proceeding, the commission may make an order that the service be made on such owner or claimant by publication of the commission’s order to show cause. The order shall direct that the publication be made in a newspaper designated by the commission as likely to give notice to the owner or claimant to be served, and for such time as the commission finds to be reasonable, at least once a week, but publication against an owner or claimant residing out of the State or absent therefrom shall not be less than two months.
If the address of any owner or claimant as stated in the petition or order on the commission’s own motion is out of the State, the secretary of the commission shall, within 15 days after the making and filing of the order to show cause, deposit or cause to be deposited a copy of that order, certified under the seal of the commission, with a copy of the petition or order on the commission’s own motion attached thereto or made part thereof, in the United States mail, enclosed in a sealed envelope, registered, with postage prepaid, addressed to such owner or claimant at the address specified in the petition or order on the commission’s own motion. Personal service of a copy of the order to show cause and of the petition or order on the commission’s own motion out of the State is equivalent to publication and deposit in the United States mail.
Within 10 days prior to the time set for the first hearing on the petition or order on the commission’s own motion, which time shall be not less than 30 days after the filing of the petition or the making of that order, the secretary shall serve or cause to be served upon the petitioner a written notice, specifying the time and place of the hearing. In all respects not in this chapter otherwise provided, service and the proof of service shall be made as provided by the Code of Civil Procedure. Upon the completion of service upon the petitioner or upon any party in interest named in the petition or order, the commission shall have full and complete jurisdiction insofar as such petitioner or party in interest is concerned, to make each finding referred to in this chapter, to fix the just compensation to be paid for the acquisition of or damage to any property or interest therein specified in the petition or order, to designate the party or parties to the proceeding who shall pay such compensation and the owner or claimant to whom such compensation shall be paid, and to make its final order of condemnation. The failure to make service upon any person alleging that he is an owner or claimant or party in interest but not named in the petition or order or to acquire jurisdiction over such person shall in no way affect the jurisdiction of the commission over owners and claimants and parties in interest on whom service has been made.
The commission at any time subsequent to the filing of the petition, and prior to making and filing its finding of just compensation, may authorize the amendment of the petition, or in case the proceeding is by order on the commission’s own motion may amend the order, by altering or modifying the description of the property or interest therein, or by adding to or deducting from the property or interest therein, or by bringing in any additional party or parties, or in any other respect including jurisdictional allegations.
At the time and place specified in the order to show cause, or at such other time and place as, for good cause, is otherwise ordered by the commission, the commission shall proceed to a hearing upon the petition or order on the commission’s own motion. When the proceeding has been submitted the commission shall make and file its finding upon the question whether the use to which the property or interest therein is to be applied is a use authorized by law and whether the taking is necessary to such use, and shall make and file its written finding fixing the just compensation to be paid for the property or interest. If the commission finds that severance damages should be paid, the just compensation for such damages shall be found and stated separately. The just compensation shall be fixed by the commission as of the day on which the petition was filed or the order on the commission’s own motion was made.
The commission shall also make its order designating the party or parties to the proceeding who shall pay the just compensation so fixed, or any portion thereof, the amounts in which it shall be paid, the times at which it shall be paid, the property or interest therein for which it shall be paid, and the owners and claimants of such property or interest to whom it shall be paid. The commission may prescribe any other terms or conditions with reference to the payment of such compensation as the commission deems proper, including a provision that the money due be paid to the commission to be distributed to the parties entitled thereto.
The party or parties whom the commission designates to pay such compensation or any part thereof are thereupon liable therefor, and may be sued in any court of competent jurisdiction by the party or parties entitled to such compensation as provided in the commission’s order. In cases in which the order of the commission authorizing any work to be done under the provisions of this chapter is permissive in character and not mandatory, the commission may prescribe the time within which the party receiving such permission shall elect to proceed and notify the commission thereof, and only in the event such party elects to proceed and so notifies the commission shall any liability arise to pay the compensation or any part thereof under the provisions of this section. When any political subdivision of the State is designated by the commission to pay such compensation or any portion thereof it shall be collectible in the manner provided in Section 1203 for the collection of expenses apportioned by the commission to political subdivisions of the State.
When the just compensation has been paid in accordance with the commission’s order, the commission shall make its final order of condemnation which shall describe the property or interest therein condemned and the purpose of such condemnation. A copy of the order certified under the seal of the commission shall thereupon be filed in the office of the recorder of the county in which the property described is situated, and thereupon the property or interest in or to property described therein shall vest in the parties and for the purposes specified in the order.
The finding of the commission on the question of the necessity for the taking and the finding fixing the just compensation to be paid for any property or interest in or to property under Sections 1206 to 1216, inclusive, are final and shall not be subject to modification, alteration, reversal, or review by any court of this state.
The provisions of this part with reference to rehearing and review shall be applicable to the findings of the commission made and filed under this chapter. Petitions for rehearing shall be filed within 20 days from the date of making and filing the finding as to which a rehearing is desired.
If a finding of the commission made and filed under this chapter is set aside by the Supreme Court or the court of appeal of the State of California, the matter shall be referred back to the commission for further action in a proceeding before the commission, and the commission may, on taking further action, consider the entire testimony theretofore taken in the proceeding before the commission as well as further testimony, if any, presented in connection with further action.
The procedure provided in this chapter shall be alternative and cumulative and not exclusive to the right to pursue any other procedure providing for the acquisition under eminent domain proceedings of property or interest in or to property.
Nothing in this chapter shall entitle any owner or claimant of property and interest in or to property to receive damages when the right to receive such damages does not exist under the laws of this State apart from the provisions of this chapter.
The Legislature declares that Sections 1201 to 1205, inclusive, are enacted as germane and cognate parts of and as aids to the jurisdiction vested in the commission for the supervision, regulation, and control of railroad and street railroad corporations in this State, and the Legislature further declares that the authority and jurisdiction thus vested in the commission involve matters of state-wide importance and concern and have been enacted in aid of the health, safety, and welfare of the people of this State.
CHAPTER 6.5. Protection of Grade Crossings [1231. - 1232.]
The commission shall allocate and expend any money which may be appropriated, from the State Highway Account in the State Transportation Fund or any other fund, for the purposes specified herein, to cities, counties, and cities and counties, on the basis of need as determined by the commission, to assist them in paying their shares of the cost of constructing grade-crossing protection works on city, county, and city and county streets, roads, and highways. In no event, however, shall the commission allocate or expend to any city, county, or city and county a sum exceeding one-half of its share of the cost of such work.
Funds appropriated for the purposes specified herein shall be available for allocation and expenditure without regard to fiscal years.
In each annual proposed budget prepared by the Department of Transportation under Section 165 of the Streets and Highways Code, the sum of one million dollars ($1,000,000) shall be set aside for allocations to the Public Utilities Commission for the purpose of paying to the railroad or street railroad corporations the share of the costs to cities, counties, and cities and counties of maintaining automatic grade-crossing protection. The Public Utilities Commission may recommend a sum greater than one million dollars ($1,000,000) be set aside for allocations to the Public Utilities Commission for the purpose of making those payments, if the Public Utilities Commission finds that the sum of one million dollars ($1,000,000) is not sufficient due to an increase in the number of grade-crossing protection devices, or increase in the cost of maintenance of those devices. The specific amount of the total allocation shall be determined by the California Transportation Commission and shall constitute the amount necessary for that maintenance. In arriving at the amount, the California Transportation Commission shall consult with the Public Utilities Commission. Payment shall be made on the basis of verified claims filed with the Public Utilities Commission by the railroad or street railroad corporation responsible for maintenance of automatic grade-crossing protection. Any amounts not expended by the Public Utilities Commission in any one fiscal year may be credited to subsequent annual allocations.
Funds appropriated for the purposes of this section shall be available for allocation and expenditure without regard to fiscal years.
At the time the commission makes each allocation under this chapter, it shall so certify to the State Controller. The commission shall present claims for reimbursement of the state’s share of the cost of construction of projects under any allocations to the State Controller for payment. The State Controller shall make such audit as he deems necessary, before or after disbursement, for the purpose of determining that the money allocated has been expended for the purposes and under the conditions authorized under this chapter; except that prior or subsequent review and approval by the city, county, or city and county in which the grade-crossing protection is maintained of such allocations shall not be required as a condition of disbursement.
CHAPTER 7. Valuation of Public Utility Properties [1351. - 1354.]
The commission may ascertain for each purpose specified in this part, the value of the property of every public utility in this State and every fact and element of value which in its judgment may or does have any bearing on such value. The commission may make revaluations from time to time and ascertain the value of all additions, betterments, extensions, and new construction to the property of every public utility.
For the purpose of ascertaining the matters and things specified in Section 1351, the commission may cause a hearing to be held at such time and place as it may designate. Before any hearing is had, the commission shall give the public utility affected thereby at least 30 days’ written notice, specifying the time and place of the hearing, and such notice shall be sufficient to authorize the commission to inquire into the matters designated in Sections 1351 to 1354, inclusive, but this provision shall not prevent the commission from making any preliminary examination or investigation into those matters. All public utilities affected shall be entitled to be heard and may introduce evidence at such hearing. The evidence introduced at such hearing shall be reduced to writing and certified under the seal of the commission.
The commission may make and file its written findings of fact upon matters concerning which evidence has been introduced before it which, in its judgment, have bearing on the value of the property of the public utility affected. These findings shall be subject to review by the courts in the same manner and within the same time as other orders and decisions of the commission.
The findings of the commission so made and filed, when certified under the seal of the commission, shall be admissible in evidence in any action, proceeding, or hearing before the commission or any court in which the commission, the state, or any officer, department, or institution thereof, or any county, city and county, city, or other body politic and the public utility affected may be interested, whether arising under this part, or otherwise. These findings, when so introduced, shall be conclusive evidence of the facts therein stated as of the date therein stated under conditions then existing, and these facts may only be controverted by showing a subsequent change in conditions bearing upon the facts therein determined.
The commission may, from time to time, cause further hearings and investigations to be had for the purpose of making revaluations or ascertaining the value of any additions, betterments, extensions, and new construction made by any public utility subsequent to any prior hearing or investigation, and may examine into all matters which may change, modify, or affect any finding of fact previously made, and may at such time make findings of fact supplementary to those theretofore made. Such hearings shall be had upon the same notice, and be conducted in the same manner, and the findings so made shall have the same force and effect as is provided in this chapter for original notice, hearing, and findings. Findings made at such supplemental hearings or investigations shall be considered in connection with and as a part of the original findings, except insofar as such supplemental findings change or modify the findings made at the original hearing or investigation.
CHAPTER 8. Determination of Just Compensation for Acquisition of Utility Properties [1401. - 1421.]
As used in this chapter, “lands, property, and rights” includes a part or portion thereof.
As used in this chapter, “political subdivision” means a county, city and county, city, municipal water district, county water district, irrigation district, public utility district, or any other public corporation.
Any political subdivision may, at any time, file with the commission either a petition of the first class, setting forth the intention of the political subdivision to acquire under eminent domain proceedings, or otherwise, the lands, property, and rights of any character whatsoever of any public utility or a petition of the second class, setting forth the intention of the political subdivision to initiate such proceedings as may be required under the law governing the political subdivision for the purpose of submitting to the voters of the political subdivision a proposition to acquire under eminent domain proceedings, or otherwise, the lands, property, and rights of any character whatsoever of any public utility.
Each such petition shall contain the name of the political subdivision appearing as petitioner therein, a description of the lands, property, and rights which the political subdivision intends to acquire, and the names and addresses of all owners and claimants thereof, including each trustee and mortgagee under each deed of trust and mortgage, if known, or a statement that they are unknown. The petition shall pray that the commission fix the just compensation which shall be paid by the political subdivision, under the law, for such lands, property and rights. The petition shall be signed in the name of the political subdivision and verified by the chairman or other presiding officer or by the secretary or clerk of the legislative or other governing body of the political subdivision. At the time the petition is filed, the petitioner shall also file with the commission additional copies thereof equivalent in number to three more than the number of owners and claimants named in the petition.
Upon the filing of the petition the commission shall make its order to show cause. The order shall specify the nature of the proceeding, contain a general description of the lands, property, and rights which petitioner desires to acquire by condemnation or otherwise, and direct the owners and claimants named in the petition, who shall also be named in the order, to appear before the commission at a time and place specified in the order, to show cause, if any they have, why the commission should not proceed to hear the petition and to fix the just compensation to be paid for the lands, property, and rights.
The order shall direct the executive director of the commission to serve or cause to be served upon each owner and claimant a copy of the order certified under the seal of the commission to which shall be attached a copy of the petition.
With respect to water corporations and water companies, the following procedures shall apply:
Upon the filing of the petition, the commission shall make its order to show cause. The order shall specify the nature of the proceeding, contain a general description of the lands, property, and rights which petitioner desires to acquire by condemnation or otherwise, and direct the owners and claimants named in the petition, who shall also be named in the order, to appear before the commission at a time and place specified in the order and to show cause, if any they have, why the commission should not proceed to hear the petition and to fix the just compensation to be paid for the lands, property, and rights.
The order shall direct the executive director of the commission to serve or cause to be served upon each owner and claimant a copy of the order certified under the seal of the commission to which shall be attached a copy of the petition.
In response to the order to show cause, in response to a petition of the first class, as specified in Section 1403, the respondent public utility, or the owners of more than one-half interest in the public utility, may present the commission with a certified copy of a filed motion to the superior court where the utility property is located to take jurisdiction of the matter. When presented the motion before, or at the time of, the hearing on the order to show cause, the commission shall dismiss the proceeding. The superior court shall then grant the motion to take jurisdiction of the matter. The political subdivision may then file, within 60 days of the court’s granting the motion, an action in eminent domain pursuant to the Code of Civil Procedure and any further proceedings shall be conducted pursuant to those provisions.
All proceedings held pursuant to either subdivision (b) or (d) shall be given priority over all civil cases in accordance with Section 1260.010 of the Code of Civil Procedure.
In response to an order to show cause in response to a petition of the second class, as specified in Section 1403, and upon presentation of the motion specified in subdivision (b), the commission shall suspend the proceeding, but shall not dismiss the proceeding. The superior court shall then grant the motion to take limited jurisdiction of the matter solely for the purpose of determining the amount of just compensation. The political subdivision may then file, within 30 days, an action in the nature of eminent domain, solely for the purpose of determining, pursuant to the Evidence Code and the Code of Civil Procedure, the just compensation to be paid for the land, property, and rights. Upon a determination of just compensation, the court shall certify the finding to the commission. The finding shall not be appealable, and the court shall be acting as an agent of the commission in making the finding. The finding shall be binding on the commission as if it had been made by the commission itself pursuant to Section 1411. The commission shall then continue the matter pursuant to this chapter.
If the respondent public utility, or the owners of more than one-half interest in the public utility, in the case of a petition of either the first or second class, files a motion to remove the matter from the commission to superior court pursuant to this section, the commission and the court shall not make an award of any litigation expenses incurred prior to the commission’s dismissal or suspension of the matter.
Notwithstanding any other provision of law, the date of valuation for purposes of just compensation shall be fixed by the superior court as of the day on which the court grants the motion filed by the public utility pursuant to subdivision (b) or (d).
A political subdivision is liable only as provided in Sections 1414 and 1415 for payment of the reasonable expenditures of the owner in any proceeding initiated pursuant to subdivision (d). For purposes of this subdivision, the proceeding before the commission, as used in Section 1415, includes any proceedings conducted pursuant to subdivision (d).
The amendments made to this section by Assembly Bill 616 during the 1987 portion of the 1987–88 Regular Session of the Legislature shall not apply to or affect any petition filed pursuant to this section before January 1, 1988.
Service of the order to show cause shall be made in accordance with the provisions of the Code of Civil Procedure or by depositing a copy of the order to show cause certified under the seal of the commission with a copy of the petition attached thereto, in the United States mail, enclosed in a sealed envelope, registered, with postage prepaid, addressed to each of the owners or claimants, at the address specified in the petition.
If any owner or claimant named in the petition resides out of the State or has departed from the State or cannot after due diligence be found within the State, or conceals himself to avoid service, or is a corporation having no managing or business agent, cashier or secretary or other officer upon whom summons may be served, who, after due diligence, can be found within the State, and the fact appears by affidavit to the satisfaction of the commission, and it also appears by such affidavit or by the petition that a cause of action exists against the owner or claimant on whom the service is to be made or that he is a necessary or proper party to the proceeding, the commission shall make an order that the service be made on such owner or claimant by publication of the commission’s order to show cause. The order shall direct that the publication be made in a newspaper designated by the commission as likely to give notice to the person to be served, and for such time as the commission finds to be reasonable, at least once a week, but publication against an owner or claimant residing out of the State or absent therefrom shall not be less than two months. If the address of any owner or claimant, as stated in the petition, is out of the State, the secretary of the commission shall, within 15 days after the making and filing of the order to show cause, deposit or cause to be deposited a copy of that order, certified under the seal of the commission, with a copy of the petition attached thereto, in the United States mail, enclosed in a sealed envelope, registered, with postage prepaid, addressed to such owner or claimant at the address specified in the petition. When publication is ordered, personal service of a copy of the order to show cause and of the petition out of the State is equivalent to publication and deposit in the United States mail.
Within 10 days prior to the time set for the first hearing on the petition, which time shall be not less than 30 days after the filing of the petition, the executive director of the commission shall serve or cause to be served upon the petitioner a written notice specifying the time and place of the hearing. In all respects not in this chapter otherwise specified, service and the proof of service shall be made as provided by the Code of Civil Procedure. Upon the completion of service upon the petitioner or upon any owner or claimant named in the petition, the commission shall have full and complete jurisdiction over such petitioner, owner, or claimant, with full and complete jurisdiction, insofar as such petitioner, owner, or claimant is concerned, to make each finding referred to in this chapter. The failure to make service upon any person alleging that he is an owner or claimant but not named in the petition shall in no way affect the jurisdiction of the commission over owners and claimants on whom service has been made.
At the time and place specified in the order to show cause, or at such other time and place as, for good cause, is otherwise ordered by the commission, the commission shall proceed to a hearing on the petition. At such times and in such amounts as is directed by the commission, the political subdivision shall pay to the commission all extra costs as determined by the commission, which the commission incurs to comply with the requirements of this chapter, and if such amounts are not paid by the political subdivision as directed by the commission, the commission may suspend further proceedings on the petition. Evidence may be presented by the political subdivision, by each owner or claimant named in the petition, and by the commission.
The commission may, at any time subsequent to the filing of the petition, and prior to making and filing its finding as to just compensation, authorize the amendment of the petition by altering or modifying the description of the lands, property, and rights, or by adding to or deducting from the lands, property, and rights, and in each other respect including jurisdictional allegations.
When the proceeding has been submitted, the commission shall make and file its written finding fixing, in a single sum, the just compensation to be paid by the political subdivision for the lands, property, and rights. If the commission finds that severance damages should be paid, the just compensation for such damages shall be found and stated separately. The just compensation shall be fixed by the commission as of the day on which the petition was filed with the commission.
Within 20 days after the commission has made and filed its finding, the owner of the lands, property, and rights may file with the legislative or other governing body of the political subdivision a written stipulation consenting and agreeing to accept the just compensation fixed by the commission. Upon the filing of the stipulation, the political subdivision shall proceed with all due diligence to provide the necessary funds under the law governing the providing of such funds, for paying the just compensation fixed by the commission. Whenever the just compensation has been tendered by the political subdivision, a deed of grant, bargain, and sale conveying the owner’s right, title, and interest in and to the lands, property, and rights to the political subdivision shall be executed and delivered by the owner, and the other claimants who have any right, title, or interest in the property shall execute appropriate instruments conveying or releasing to the political subdivision their respective rights, titles, and interests therein. If the deed or the instruments of convenience or release are not executed and delivered within 60 days after such tender has been made, the political subdivision may commence an action in a court of competent jurisdiction or proceed under Section 1413.
In the case of a petition of the first class, if the owner does not file the stipulation within such 20 days, the political subdivision, within 60 days after the commission has made and filed its finding, shall commence an action in a court of competent jurisdiction to take such lands, property, and rights, under eminent domain proceedings. In the case of a petition of the second class, if the owner does not file the stipulation within such 20 days, the political subdivision, within 60 days after the commission has made and filed its finding, shall initiate proceedings for the purpose of submitting to its voters a proposition to acquire under eminent domain proceedings the lands, property, and rights. The political subdivision shall not be required, in either case, to delay for more than 20 days after the commission has made and filed its finding, before commencing such further proceedings. In the case of a petition of the second class, if the voters of the political subdivision, as provided by the law governing the political subdivision, vote in favor of any proposition to acquire under eminent domain proceedings, or otherwise, such lands, property, and rights, the political subdivision shall, within 60 days thereafter, commence an action in a court of competent jurisdiction to take such lands, property, and rights, under eminent domain proceedings, unless the owner has filed with the political subdivision a written stipulation consenting and agreeing to accept the just compensation fixed by the commission.
If the political subdivision, in a petition of the first class, fails to file such action in a court of competent jurisdiction within such period of 60 days after the commission has made and filed its finding, or if the political subdivision, in a petition of the second class, fails to proceed diligently to submit the proposition to its voters or fails, if its voters have voted in favor of the acquisition of the lands, property, and rights, to file such action in a court of competent jurisdiction within 60 days thereafter, the owner of such lands, property, and rights may file with the commission a verified petition in writing setting forth that fact. The petition may also set forth in detail the expenditures which the owner has necessarily incurred in the proceeding before the commission.
The commission shall thereupon cause written notice, with a copy of the owners’ petition attached thereto, to be served upon the political subdivision, to appear before the commission at a time and place specified in the notice, to show cause why an order should not be made by the commission (a) finding that the political subdivision has failed to pursue diligently its rights, (b) determining that the finding as to just compensation shall no longer be of any force or effect, and (c) determining the reasonable expenditures necessarily incurred by the owner which, in the opinion of the commission, should be assessed against the political subdivision. The time specified in the notice shall be not less than 10 days subsequent to the date of service.
If the commission determines that the political subdivision, in case of a petition of the first class, has failed to commence the action in a court of competent jurisdiction within 60 days after the commission has made and filed its finding of just compensation, or that the political subdivision, in case of a petition of the second class, has failed to proceed diligently to submit the proposition to its voters or has failed, after its voters have voted in favor of the acquisition of the lands, property or rights, to file such action in a court of competent jurisdiction within 60 days thereafter, the commission shall make and file its order declaring that such finding shall no longer be of any force or effect, and make its finding as to the reasonable expenditures necessarily incurred by the owner in the proceeding before the commission, which should be assessed against the political subdivision. The political subdivision shall thereupon be liable to the owner in the amount thus found by the commission, and the owner may thereupon maintain an action against the political subdivision for such amount in any court of competent jurisdiction.
The finding of the commission fixing the just compensation to be paid by the political subdivision for the lands, property, and rights shall be final and shall not be subject to modification, alteration, reversal, or review by any court of this State. If the court in which the political subdivision has commenced its action, subsequent to the making and filing by the commission of its finding as to just compensation, decides that the political subdivision has the right and power under the law to take the lands, property, and rights, it shall enter a judgment in favor of the complainant in the action, fixing as the just compensation which shall be paid for the taking of the lands, property, and rights, the just compensation fixed by the commission. The judgment may include the allowance of such costs between the parties as is provided for in the law of eminent domain of this State. The judgment of the court insofar as it refers to the just compensation to be paid for the lands, property, and rights, shall be final and shall not be subject to modification, alteration, reversal, or review by any court except as specified in this chapter. The judgment of the court shall include a provision, in substance, that it is subject to modification by reason of such increase or decrease in the just compensation to be paid as may thereafter be certified to the court by the commission, as provided in this chapter.
At any time within 30 days subsequent to the entry of such judgment, the owner of the lands, property, and rights may file with the commission a verified petition in writing, alleging that by reason of expenditures made by the owner subsequent to the date of the filing of the original petition with the commission, for the purpose of preserving or improving the lands, property, and rights, or by reason of other acts and occurrences subsequent to that date, the just compensation theretofore fixed by the commission should be increased, and praying that the commission make its finding increasing such compensation. At any time within 30 days subsequent to the entry of the judgment, the political subdivision may file with the commission a verified petition in writing, alleging that by reason of loss or destruction of the lands, property, and rights, or by reason of depreciation or deterioration thereof or by reason of other acts and occurrences, subsequent to the date of the filing of the original petition, the just compensation theretofore fixed by the commission should be decreased, and praying that the commission make its finding decreasing the compensation. The commission shall in each instance cause a copy of such petition or petitions to be served upon each party other than the petitioner, who was named as the political subdivision, owner, or claimant in the original proceeding before the commission, together with a written notice specifying the time and place of hearing on such petition or petitions, which time shall be within 45 days after the entry of the judgment by the court, and shall cause written notice of the time and place of the hearing to be served upon each petitioner in such petition or petitions. If both such petitions are filed, the commission may consolidate them for hearing and decision.
After a hearing, the commission shall make and file its finding fixing, as of the date on which the finding is made and filed, the extent to which the just compensation theretofore fixed should be increased or decreased by reason of the matters alleged in the petition or petitions. If the claim is made that the just compensation theretofore fixed by the commission should be increased by reason of expenditures made by the owner subsequent to the date of the filing of the original petition with the commission for the purpose of preserving or improving the lands, property, and rights the commission may increase the just compensation only to the extent to which the commission determines that such expenditures were beneficial to the lands, property, and rights, and reasonably and prudently made. The finding of the commission fixing the extent to which the just compensation theretofore fixed should be thus increased or decreased shall be final and shall not be subject to modification, alteration, reversal, or review by any court of this State.
The commission shall thereupon transmit to the court its finding, certified under the seal of the commission, fixing the extent to which the just compensation theretofore fixed by the commission shall be increased or decreased. The court shall thereupon modify its judgment so as to conform with the finding of the commission. The judgment of the court, as thus modified, insofar as it refers to the just compensation to be paid for the lands, property, and rights, shall be final and shall not be subject to modification, alteration, reversal, or review by any court. The filing of either or both the petitions specified in Section 1417 shall not act as a stay of the judgment in condemnation, but upon the payment of the just compensation fixed in the original judgment of condemnation the plaintiff in the action shall be entitled to immediate possession of the lands, property, and rights.
The provisions of this part with reference to rehearing and review shall be applicable to the findings of the commission made and filed under this chapter. Petitions for rehearing shall be filed within 20 days from the date of making and filing the finding as to which a rehearing is desired.
If the finding of the commission is set aside by the Supreme Court or the court of appeal of the State of California, the matter shall be referred back to the commission for further action in the proceeding before the commission, and the commission may, in taking further action, consider the entire testimony theretofore taken in the proceeding before the commission as well as further testimony presented in connection with the further action.
If a writ of review is issued by the Supreme Court or court of appeal of the State of California, the time within which the political subdivision shall file an action in a court of competent jurisdiction or submit the proposition to its voters shall be extended to not more than 60 days beyond the final decision of the court upon that writ.
The procedure provided in this chapter shall be alternative and cumulative and not exclusive, and the political subdivision shall continue to have the right to pursue any other procedure providing for the acquisition under eminent domain proceedings of the lands, property, and rights of any public utility. This chapter shall not be construed as repealing any law of this State providing for such eminent domain proceedings.
CHAPTER 8.5. Service Duplication [1501. - 1507.]
The Legislature recognizes the substantial obligation undertaken by a privately owned public utility which is franchised under the Constitution or by a certificate of public convenience and necessity to provide water service in that the utility must provide facilities to meet the present and prospective needs of those in its service area who may request service. At the same time, the rates that may be charged for water service by a regulated utility are fixed by the Public Utilities Commission at levels which assume that the facilities so installed will remain used and useful in the operation of the utility for a period of time measured by the physical life of such facilities.
The Legislature finds and declares that the potential loss of value of such facilities which may result from the construction and operation by a political subdivision of similar or duplicating facilities in the service area of such a private utility often deters such private utility from obtaining a certificate or extending its facilities to provide in many areas a water supply essential to the health and safety of the citizens thereof.
The Legislature further finds and declares that it is necessary for the public health, safety, and welfare that privately owned public utilities regulated by the state be compensated for damages that they may suffer by reason of political subdivisions extending their facilities into the service areas of such privately owned public utilities.
As used in this chapter, “political subdivision” means a county, city and county, city, municipal water district, county water district, irrigation district, public utility district, California water district, or any other public corporation.
As used in this chapter, “service area” means an area served by a privately owned public utility in which the facilities have been dedicated to public use and in which territory the utility is required to render service to the public.
As used in this chapter, “operating system” means an integrated water system for the supply of water to a service area of a privately owned public utility.
As used in this chapter, “private utility” means a privately owned public utility providing a water service.
As used in this chapter, “type of service” means, among other things, domestic, commercial, industrial, fire protection, wholesale, or irrigation service.
As used in this chapter, “reclaimed water” means reclaimed water as defined in Section 13050 of the Water Code.
As used in this chapter, “private use” means an entity’s use of its own reclaimed water.
The Legislature finds and declares that whenever a political subdivision constructs facilities to provide or extend water service, or provides or extends such service, to any service area of a private utility with the same type of service, such an act constitutes a taking of the property of the private utility for a public purpose to the extent that the private utility is injured by reason of any of its property employed in providing the water service being made inoperative, reduced in value or rendered useless to the private utility for the purpose of providing water service to the service area.
Just compensation for the property so taken for public purposes shall be as may be mutually agreed by the political subdivision and the private utility or as ascertained and fixed by a court of competent jurisdiction pursuant to the laws of this state relating to eminent domain, including consideration of the useful value to the political subdivision of the property so taken.
Whenever the compensation by a political subdivision under this section is an amount equal to the just compensation value of all the property of the private utility in the operating system that the private utility employs in providing water service to the service area, the political subdivision may, by resolution, provide for the acquisition of all such property.
A political subdivision engaged in activities set forth in Section 1503 shall pay just compensation for the property so taken for public purposes.
The provisions of Sections 1503 and 1504 will be applicable to any political subdivision which constructs facilities to provide or extend water service or provides or extends such service to any territory theretofore actually being lawfully served by any other political subdivision with facilities designed and constructed to provide the same type of service. The provisions of this section shall not apply to any territory, or portion thereof, which is the subject of any final judgment or litigation pending on the effective date of this section involving any duplication of water service occurring prior to the effective date of this section.
As used in this chapter, “private utility” includes a mutual water company. In its application to mutual water companies, this chapter affects and relates only to the property, or portion of any property, of a mutual water company that is employed by the company in providing water service in or for a territory that is actually being provided with water service by the company when a political subdivision constructs facilities to provide or extend water service or provides or extends the service to the territory, and that territory shall constitute the “service area” of a mutual water company as used in Section 1502.
Subject to the preservation of rights of a mutual water company in subdivision (c), this section does not apply to a political subdivision that constructs facilities to provide or extend recycled water service to the territory of the mutual water company, if the political subdivision complies with the Water Recycling Act of 1991 (Chapter 7.5 (commencing with Section 13575) of Division 7 of the Water Code).
The exception in subdivision (b), for a political subdivision that constructs facilities to provide or extend recycled water service to the territory of the mutual water company, does not apply to those customers and their properties to which the mutual water company was providing recycled water service, or for whom the mutual water company has identified and developed specific plans to provide recycled water service, as of December 31, 2014.
This chapter shall not be applicable if all of the following conditions are met:
The use is limited to the private use of reclaimed water by an entity that owns a water reclamation plant.
The use is limited to the premises of a water reclamation plant or landfill owned by the entity that owns or operates the water reclamation plant.
The use is limited to dust suppression, and irrigation purposes, and other uses on the site for which reclaimed water has been approved by the State Department of Health Services.
No existing reclaimed water facilities, whether owned or operated by a private utility or political subdivision, can reasonably and economically serve the intended use.
If reclaimed water is used on the premises of a landfill, the entity provides appropriate compensation to the private utility or political subdivision for those facilities directly used for the water services being replaced by reclaimed water service. Appropriate compensation shall not include valuations based on revenues lost by the private utility or political subdivision due to replacement of water service with reclaimed water.
This section shall apply only in Los Angeles County.
CHAPTER 8.7. School Energy Efficiency Stimulus Program [1600. - 1640.]
ARTICLE 1. General Provisions and Definitions [1600. - 1601.]
The Legislature finds and declares all of the following:
The School Energy Efficiency Stimulus Program, established pursuant to Section 1610, is intended to save energy, create jobs in a time of economic crisis, and provide direct support to schools and school children in underserved communities.
The combined extraordinary crises of the COVID-19 pandemic and the economic recession require mustering all possible state resources to protect our most vulnerable populations while also bolstering the economy as a whole.
There is no program in California dedicated to improving ventilation and energy efficiency in California schools at the scale required to safely prepare schools for operating during the COVID-19 pandemic. This program is vitally needed to protect the health, safety, and ability to learn for California’s school children and the health of California’s teachers.
There is no program in California dedicated to replacing old, inefficient plumbing fixtures that waste potable water (and the energy needed to treat and convey that water) and that have high lead content that can leach into student’s drinking water. This program is needed to replace inefficient fixtures and appliances in schools, which would save approximately 6 billion gallons of water a year and protect student health.
It is the intent of the Legislature to advance high-quality jobs in underserved communities by increasing demand for skilled workers to implement this work.
The School Energy Efficiency Stimulus Program is an urgent energy efficiency measure. This program will reduce energy use in schools that otherwise would result from repairs and upgrades to school ventilation systems that are necessary to meet current classroom ventilation requirements and applicable COVID-19 school reopening guidance. This program will also replace old, out-of-date fixtures and hot-water appliances that waste significant amounts of water and energy compared to the standards required for current fixtures and appliances. All ratepayers will benefit from the reduction in system load resulting from this program.
For purposes of this chapter, the following terms have the following meanings:
“Local educational agency” means a school district as defined in Section 41302.5 of the Education Code, a charter school that has been granted a charter pursuant to Part 26.8 (commencing with Section 47600) of Division 4 of Title 2 of the Education Code, or a regional occupational center established pursuant to Section 52301 of the Education Code that is operated by a joint powers authority and that has an active career technical education advisory committee pursuant to Section 8070 of the Education Code.
“SRVEVR Program” means the School Reopening Ventilation and Energy Efficiency Verification and Repair Program as specified in Article 3 (commencing with Section 1620).
“Skilled and trained workforce” has the same meaning as set forth in Section 2601 of the Public Contract Code.
“SNPFA Program” means the School Noncompliant Plumbing Fixture and Appliance Program as specified in Article 4 (commencing with Section 1630).
“Underserved community” means a community that meets one of the following criteria:
Is a “disadvantaged community” as defined by subdivision (g) of Section 75005 of the Public Resources Code.
Is included within the definition of “low-income communities” as defined by paragraph (2) of subdivision (d) of Section 39713 of Health and Safety Code.
Is within an area identified as among the most disadvantaged 25 percent in the state according to the California Environmental Protection Agency and based on the most recent California Communities Environmental Health Screening Tool, also known as CalEnviroScreen.
Is a community in which at least 75 percent of public school students in the project area are eligible to receive free or reduced-price meals under the National School Lunch Program.
Is a community located on lands belonging to a federally recognized California Indian tribe.
“Utility” or “utilities” means both of the following:
An electrical corporation with 250,000 or more customer accounts within the state.
A gas corporation with 400,000 or more customer accounts within the state.
ARTICLE 2. School Energy Efficiency Stimulus Program [1610. - 1618.]
By no later than February 1, 2021, the utilities shall file a joint advice letter pursuant to Section 5.1 of General Order 96-B, to fund a joint School Energy Efficiency Stimulus Program as part of each of their energy efficiency portfolios. The School Energy Efficiency Stimulus Program shall be a joint program among all the participating utilities that shall be consistent across the utility territories and shall be designed, administered, and implemented by the Energy Commission as the program administrator. The commission shall approve the advice letter no later than March 1, 2021. The School Energy Efficiency Stimulus Program shall consist of both of the following programs:
The School Reopening Ventilation and Energy Efficiency Verification and Repair Program as specified in Article 3 (commencing with Section 1620).
The School Noncompliant Plumbing Fixture and Appliance Program as specified in Article 4 (commencing with Section 1630).
Each utility shall work with the Energy Commission to ensure the SRVEVR Program and SNPFA Program are operative and begin to solicit applications for grants on or before April 1, 2021, and begin to approve applications no later than May 1, 2021, subject to the availability of funds.
Not less than 25 percent of projects funded by the SRVEVR Program or SNPFA Program shall be in underserved communities. The SRVEVR Program and SNPFA Program shall prioritize underserved communities by ensuring that all schools that are in an underserved community are offered the opportunity to apply for and receive grants before those schools that are not in an underserved community. Additionally, the SRVEVR Program shall prioritize schools with a boundary that is within 500 feet of the edge of the closest traffic lane of a freeway or other busy traffic corridor or within 1,000 feet of a facility holding a permit pursuant to Title V of the Clean Air Act (42 U.S.C. Section 7661 et seq.). For the purposes of this section, “freeway or other busy traffic corridors” has the same meaning as defined in paragraph (9) of subdivision (d) of Section 17213 of the Education Code.
The SRVEVR Program and the SNPFA Program shall be considered a third-party program for compliance with the commission Decision 16-08-019 (August 18, 2016) Decision Providing Guidance for Initial Energy Efficiency Rolling Portfolio Business Plan Filings.
The Energy Commission, in collaboration with each utility, shall adopt guidelines and regulations for the SRVEVR Program and the SNPFA Program.
The Administrative Procedure Act (Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code) does not apply to the adoption of guidelines or regulations pursuant to this section.
The Energy Commission shall adopt regulations or guidelines no later than May 1, 2021, and shall begin approving applications promptly upon their adoption.
Other than the workforce qualification requirements, the technical and reporting requirements of the SRVEVR Program as set forth in Sections 1623 through 1627 of Article 3 (commencing with Section 1620) may be amended by the Energy Commission pursuant to subdivisions (a) and (b) of this section, as necessary, to reflect the latest COVID-19 or other applicable guidance, or otherwise to achieve the intent of the SRVEVR Program and to ensure consistency with related requirements and codes.
The commission shall require each utility to fund the School Energy Efficiency Stimulus Program by allocating their energy efficiency budgets for program years 2021, 2022, and 2023, in both of the following amounts:
An amount equal to the applicable percentage of the difference between the budget contained in each utility’s 2020 annual budget advice letter approved as of July 1, 2020, and the annual portfolio funding limitation for program year 2020 as set forth in the 2018–2025 business plan of each utility as approved and modified in ordering paragraph 45 of the commission’s Decision 18-05-041 (May 31, 2019) Decision Addressing Energy Efficiency Business Plans, as modified by Decision 20-02-029 (February 6, 2020) Order Modifying Decision (D.) 18-05-041 and Denying Rehearing of Decision, as Modified. The applicable percentage is 80 percent for program year 2021, 70 percent for program year 2022, and 60 percent for program year 2023.
Any carryover amount from unspent and uncommitted energy efficiency funds for program year 2020, 2021, or 2022 to the School Energy Efficiency Stimulus Program for the following year’s budget.
Funding allocations required by this subdivision shall only apply to program years 2021, 2022, and 2023.
Any funds allocated towards the School Energy Efficiency Stimulus Program pursuant to this section that remain unspent by the end of each program year may be carried over and contribute to the next year’s budget for the School Energy Efficiency Stimulus Program until the end of the 2023 energy efficiency program year.
This section does not authorize the levy of a charge or any increase in the amount collected pursuant to an existing charge beyond the amounts authorized by the commission in Decision 18-05-041, or as modified by Decision 20-02-029, nor does it add to, or detract from, any existing authority of the commission to levy or increase charges.
This subdivision does not change the commission’s authority to determine revenue allocation and rate design, including its ability to prioritize customers participating in the California Alternative Rates for Energy or Family Electric Rate Assistance programs when considering appropriate revenue allocation for energy efficiency programs.
The Energy Commission shall ensure that moneys from each utility for the School Energy Efficiency Stimulus Program are used for projects located in the service territory of that utility from which the moneys are received.
The Energy Commission may use no more than 5 percent, not to exceed five million dollars ($5,000,000) per year, of the SRVEVR Program and the SNPFA Program funds for administrating the programs, including providing technical support to program participants. The commission shall ensure that funds allocated to the Energy Commission pursuant to this section are transferred to an account specified by the Energy Commission within 60 days after the completion of the prior energy efficiency program year.
The School Energy Efficiency Stimulus Program Fund was administratively established for the Energy Commission to receive funds allocated pursuant to this chapter.
Notwithstanding Section 13340 of the Government Code, the moneys in the School Energy Efficiency Stimulus Program Fund are hereby continuously appropriated to the Energy Commission without regard to fiscal years for the purposes of the School Energy Efficiency Stimulus Program established pursuant to this chapter, including, but not limited to, paying the costs of program administration.
Notwithstanding all funds allocated in subdivision (d), all non-committed funds allocated in subdivision (a) shall be spent or returned to each utility by December 1, 2026.
Any funds committed as of August 31, 2026, shall be encumbered by December 1, 2028, liquidated by December 1, 2029, and returned to each utility by January 30, 2030.
The Energy Commission may set application and encumbrance deadlines to ensure that the reversion of funds is consistent with subdivision (f).
The Energy Commission shall take steps, consistent with Section 25230 of the Public Resources Code, to ensure that a diverse group of contractors are aware of funding opportunities available through the School Energy Efficiency Stimulus Program.
Moneys for the School Energy Efficiency Stimulus Program for each program year shall be allocated as follows:
Seventy-five percent to the SRVEVR Program.
Twenty-five percent to the SNPFA Program.
The School Energy Efficiency Stimulus Program advances the public interest in maximizing cost-effective energy savings and related public benefits, including ensuring that ratepayer investments unlock deeper energy savings and benefit underserved communities. Because the commission’s current cost-effectiveness methodology does not fully take into account indirect and nonmonetary public benefits, that methodology shall not be applied to these projects. Expenditures on the School Energy Efficiency Stimulus Program shall be found to be cost effective and shall not be considered by the commission when calculating the overall cost-effectiveness of energy efficiency portfolios of electrical corporations or gas corporations.
Reducing emissions of greenhouse gases and energy savings attributed to a project funded by the School Energy Efficiency Stimulus Program shall be attributed to the utility that provided those funds when determining compliance with applicable greenhouse gas or energy efficiency saving mandates. The baseline for determining reductions in emissions of greenhouse gases and energy savings from the SRVEVR Program shall be the energy demand and emissions of greenhouse gases that would have occurred if ventilation and filtration recommendations for reopening schools were met without the assessment, adjustment, maintenance, repairs, and efficiency upgrades funded pursuant to the program.
ARTICLE 3. School Reopening Ventilation and Energy Efficiency Verification and Repair Program [1620. - 1627.]
For purposes of this article, the following definitions apply:
“Certified TAB Technician” means a technician certified to perform testing, adjusting, and balancing of HVAC systems by the Associated Air Balance Council (AABC), the National Environmental Balancing Bureau (NEBB), or the Testing, Adjusting and Balancing Bureau (TABB).
“HVAC” means heating, ventilation, and air conditioning.
“Licensed Professional” means a professional eligible under Division 3 (commencing with Section 5000) of the Business and Professions Code in the applicable classification, to perform system design, construction, or installation of features, materials, components, or manufactured devices for mechanical systems.
“MERV” means minimum efficiency reporting value.
“ppm” means parts per million.
“Program” means the School Reopening Ventilation and Energy Efficiency Verification and Repair Program.
“Qualified adjusting personnel” means either of the following:
A certified testing, adjusting, and balancing (TAB) technician.
A skilled and trained workforce under the supervision of a TAB Technician.
“Qualified testing personnel” means either of the following:
An HVAC acceptance test technician certified to complete the forms set forth in subparagraph (B) of paragraph (1) of subdivision (b) of Section 10-103.2 of Part 1 of Title 24 of the California Code of Regulations by an Acceptance Test Technician Certification Provider (ATTCP) that is approved by the Energy Commission to provide that certification.
A certified testing, adjusting and balancing (TAB) technician.
“TAB” means testing, adjusting, and balancing.
The Energy Commission, in collaboration with each utility, shall develop and administer the School Reopening Ventilation and Energy Efficiency Verification and Repair Program to award grants to local educational agencies to reopen schools with functional ventilation systems that are tested, adjusted, and, if necessary or cost effective, repaired, upgraded, or replaced to increase efficiency and performance.
A local educational agency may apply for a grant pursuant to the program by submitting an application for reasonable costs of the HVAC assessment, assessment report, general maintenance, adjustment of ventilation rates, filter replacement, and carbon dioxide monitor installation.
The Energy Commission shall award a grant pursuant to this article if the amount requested in the application is verified by a contractor’s estimate and the local educational agency meets other requirements determined by the Energy Commission to be appropriate to achieve the purposes of this article. A grant shall be awarded in the amount requested plus an additional 20 percent of the requested amount for repairs, upgrades, or replacements necessary to make the system functional or more energy efficient.
If a licensed professional identifies cost-effective energy efficiency upgrades or repairs that would exceed the additional 20 percent awarded, a local educational agency may apply for additional funding pursuant to this article for the cost-effective energy efficiency upgrades or repairs.
The Energy Commission shall award a grant pursuant to this article for reimbursement of work already performed where the work was contracted and performed after August 1, 2020, and meets the requirements of Section 1622 to 1627, inclusive, and the local educational agency meets other requirements determined by the Energy Commission to be appropriate to achieve the purposes of this article.
The 20-percent contingency funds set forth in paragraph (1) shall be returned to the SRVEVR Program if not used for the purposes specified in this subdivision. The local education agency shall provide the Energy Commission with documentation, as specified by the Energy Commission, demonstrating how contingency funds were spent.
The Energy Commission shall have the authority to establish the timing of grant funding, including the ability to provide some or all funding in advance of the performance of work where requirements to ensure performance are established.
The local educational agency receiving a grant shall install filtration with a minimum efficiency reporting value (MERV) of 13 or better in the local educational agency’s HVAC system where feasible. Qualified testing personnel shall review system capacity and airflow to determine the highest MERV filtration that can be installed without adversely impacting equipment, shall replace or upgrade filters where needed, and shall verify that those filters are installed correctly. If a system uses ultraviolet germicidal irradiation (UVGI) to disinfect the air, the UVGI lamp shall be checked for proper operation, replacing bulbs as needed and verifying that the ultraviolet light does not shine on filters. Recommendations for additional maintenance, replacement, or upgrades to allow for more protective filtration shall be recorded in the assessment report required pursuant to Section 1626.
For systems with economizers, qualified testing personnel shall test system economizer dampers pursuant to Section B of NRCA-MCH-05-A–Air Economizer Controls. Economizer dampers and controls that are not properly functioning shall be repaired by a skilled and trained workforce. Recommendations for additional maintenance, replacement, or upgrades shall be recorded in the assessment report.
After completing the requirements of subdivision (a), a qualified testing personnel shall verify the ventilation rates in the facility classrooms, auditoriums, gymnasiums, nurses offices, restrooms, and other occupied areas to assess whether they meet the minimum ventilation rate requirements set forth in Table 120.1-A of Part 6 (commencing with Section 100.0) of Title 24 California Code of Regulations. Assessment shall include all of the following:
Calculation of the required minimum outside air ventilation rates for each occupied area based on the anticipated occupancy and the minimum required ventilation rate per occupant set forth in Table 120.1-A. Calculations shall be based on maximum anticipated classroom or other occupied area occupancy rates and determined by the performing technician. Natural Ventilation shall be designed in accordance with Section 402.2 of the California Mechanical Code (Part 4 (commencing with Section 1.1.0) of Title 24 of the California Code of Regulations) and shall include mechanical ventilation systems designed in accordance with Section 403.0, Section 404.0, or both of those sections, of the California Mechanical Code.
Measurement of outside air pursuant to Section B of NRCA-MCH-02-A–Outdoor Air Acceptance and verification of whether the system provides the minimum outside air ventilation rates calculated in subparagraph (A).
Survey readings of inlets and outlets to verify all ventilation is reaching the served zone and that there is adequate distribution. Verify if inlets and outlets are balanced within tolerance of the system design. Document read values and deficiencies. If the original system design values are not available, document available information and note unavailability of system design values in the assessment report.
Verification of building pressure relative to the outdoors to ensure positive pressure differential and to ensure the building is not over pressurized.
Verification of coil velocities and coil and unit discharge air temperatures required to maintain desired indoor conditions and to avoid moisture carry over from cooling coils.
Verification that separation between outdoor air intakes and exhaust discharge outlets meet requirements of the California Building Code.
Confirmation that the air handling unit is bringing in outdoor air and removing exhaust air as intended by the system design.
Measurement of all exhaust air volume for exhaust fans, including restrooms. Document any discrepancies from system design.
If the system does not meet the minimum ventilation rate requirements set forth in Table 120.1-A, a licensed professional or qualified adjusting personnel shall review the system airflow and capacity to determine if additional ventilation can be provided without adversely impacting equipment performance and building indoor environmental quality. If additional ventilation can be provided, a qualified adjusting personnel shall adjust ventilation rates to meet the minimum ventilation rate requirements set forth in Table 120.1-A to the extent feasible. After the adjustment, the measurement and versifications required in subparagraphs (B), (D), and (E) of paragraph (1) shall be repeated. If minimum ventilation rate requirements set forth in Table 120.1-A cannot be met, this deficiency shall be reported in the assessment report and the verification report, and addressed by a licensed professional as required pursuant to Sections 1626 and 1627.
If a demand control ventilation is installed, it shall be adjusted to a carbon dioxide set point of 800 ppm or less and tested by a qualified testing personnel pursuant to Section B of NRCA-MCH-06-A–Demand Control Ventilation Systems Acceptance. If the demand control ventilation system does not maintain average daily maximum carbon dioxide levels below 1,100 ppm, it shall be disabled until such time as the local educational agency determines that the COVID-19 crisis has passed, unless disabling the control would adversely affect operation of the overall system. When disabling a demand control ventilation system, the system must be configured to meet the minimum ventilation rate requirements and tested and adjusted in accordance with paragraph (3) of subdivision (a) of Section 1625. Recommendations for additional maintenance, replacement or upgrades shall be recorded in the assessment report.
A qualified testing personnel or a skilled and trained workforce shall verify coil condition, condensate drainage, cooling coil air temperature differentials (entering and leaving dry bulb), heat exchanger operation, and drive assembly. If repairs, replacement, or upgrades are necessary, these deficiencies shall be reported in the assessment report and the verification report, and addressed by the licensed professional pursuant to Sections 1626 and 1627.
A qualified testing personnel or qualified adjusting personnel shall do all of the following:
Review control sequences to verify systems will maintain intended ventilation, temperature and humidity conditions during school operation. Previously unoccupied buildings shall perform the recommended practices of reopening a building as covered in the American Society of Heating, Refrigerating and Air-Conditioning Engineers (ASHRAE) Building Readiness document – Restarting a Building.
Verify a daily flush is scheduled for two hours before and after scheduled occupancy or demonstrate calculation of flush times per ASHRAE Guidance for Reopening and Operating Schools and Buildings or otherwise applicable local or state guidance.
Verify that HVAC system operational times, exhaust fans operation times, setpoints, and enabled features meet ASHRAE Guidance for Reopening and Operating Schools and Buildings or otherwise applicable local or state guidance.
Requirements for filtration levels, ventilation rates, and ventilation schedules may be amended by the Energy Commission based on the latest COVID-19 or other applicable guidance.
If installed HVAC systems or system components are broken, fail to meet minimum ventilation requirements, or are unable to operate to the original design and intent, this information will be set forth in the assessment report prepared pursuant to Section 1626 to be provided to a licensed professional for determination of appropriate corrective measures pursuant to Section 1626. Repairs, upgrades, or replacements shall be performed by a skilled and trained workforce.
To ensure proper ventilation is maintained throughout the school year, all classrooms shall be equipped with a carbon dioxide monitor that meets all of the following requirements:
The monitor is hard-wired or plugged-in and mounted to the wall between three and six feet above the floor and at least five feet away from the door and operable windows.
The monitor displays the carbon dioxide readings to the teacher through a display on the device or other means such as a web-based application or cellular phone application.
The monitor provides a notification through a visual indicator on the monitor, such as an indicator light, or other alert system, such as an electronic mail, text, or cellular telephone application, when the carbon dioxide levels in the classroom have exceeded 1,100 ppm.
The monitor maintains a record of previous data that includes at least the maximum carbon dioxide concentration measured.
The monitor has a range of 400 ppm to 2000 ppm or greater.
The monitor is certified by the manufacturer to be accurate within 75 ppm at 1,000 ppm carbon dioxide concentration and is certified by the manufacturer to require calibration no more frequently than once every five years.
If a classroom carbon dioxide concentration exceeds 1,100 ppm more than once a week as observed by the teacher or the facilities staff, the classroom ventilation rates shall be adjusted by qualified personnel to ensure peak carbon dioxide concentrations in the classroom remain below the maximum allowable carbon dioxide ppm setpoint. Verification of the installation of carbon dioxide monitors in all classrooms shall be included in the assessment report required pursuant to Section 1626.
The requirements of paragraphs (1) to (6), inclusive, of subdivision (a) may be amended by the Energy Commission as necessary to reflect available technology and to achieve the intent of this section.
A qualified testing personnel or qualified adjusting personnel shall prepare an assessment report for review by a licensed professional. The licensed professional shall review the assessment report and determine what, if any, additional adjustments or repairs would be necessary to meet the minimum ventilation and filtration requirements, determine whether any cost-effective energy efficiency upgrades or replacements are warranted or recommended, and provide an estimated cost for this work. If the cost of recommended repairs, upgrades, or replacements are greater than the contingency amount provided in the grant, then the licensed professional and the local educational agency shall submit an application for additional funding pursuant to this article. The provision of any additional funding for repairs, upgrades, or replacements shall be conditioned on the applicant ensuring that all construction work funded, in whole or in part, by the additional funding is performed by a skilled and trained workforce. The assessment report shall include all of the following information:
Name and address of school facility and person or contractor preparing and certifying assessment report.
Documentation of HVAC equipment model number, serial number, general condition of unit, and any additional information that could be used to assess replacement and repair options given potential for increased energy efficiency benefits.
Either verification that MERV 13 filters have been installed or verification that the maximum MERV-rated filter that the system is able to effectively handle has been installed and what that MERV-rating is.
The verified ventilation rates for facility classrooms, auditoriums, gymnasiums, nurses’ offices, restrooms, offices, and other occupied areas, and whether those rates meet the requirements set forth in Table 120.1-A. If ventilation rates do not meet applicable requirements, then an explanation for why the current system is unable to meet those rates shall be provided.
The verified exhaust for facility classrooms, auditoriums, gymnasiums, nurses’ offices, restrooms, and other occupied areas and whether those rates meet the requirements set forth in the design intent.
Documentation of system deficiencies and recommendations for additional maintenance, replacement, or upgrades to improve energy efficiency, safety, or performance.
Upon completion of all work funded by a grant pursuant to this article, the local educational agency shall prepare an HVAC verification report. The HVAC verification report shall include all of the following information:
Name and address of school facility and person or contractor preparing and certifying report.
Description of assessment, maintenance, adjustment, repair, upgrade, and replacement activities and outcomes.
Verification that the local educational agency has complied with all requirements of this article.
Verification that either MERV 13 filters have been installed or verification that the maximum MERV-rated filter that the system is able to effectively handle has been installed and what that MERV-rating is.
The verified ventilation rates for facility classrooms, auditoriums, gymnasiums, nurses’ offices, restrooms, offices and other occupied areas and whether those rates meet the requirements set forth in Table 120.1-A. If ventilation rates do not meet applicable guidance, then an explanation for why the current system is unable to meet those rates shall be provided.
The verified exhaust for facility classrooms, auditoriums, gymnasiums, nurses’ offices, restrooms, and other occupied areas and whether those rates meet the requirements set forth in the design intent.
Documentation of system deficiencies and recommendations for additional maintenance, replacement, or upgrades to improve energy efficiency, safety, or performance.
Documentation of initial operating verifications, adjustments, and final operating verifications, and document any adjustments or repairs performed.
Verification of installation of carbon dioxide monitors, including make and model of monitors.
Verification that all work has been performed by qualified personnel, including the provision of the contractor’s name and license, acceptance test technician name and certification number, where applicable, TAB technician name and certification number, where applicable, and verification that all construction work has been performed by a skilled and trained workforce.
The local educational agency shall maintain a copy of the HVAC verification report and make it available to any member of the public or the Energy Commission upon request.
ARTICLE 4. School Noncompliant Plumbing Fixture and Appliance Program [1630. - 1633.]
For purposes of this article, the following terms have the following meanings:
“Noncompliant appliance” means all of the following:
Any commercial dishwasher that was manufactured prior to January 1, 2010, that does not meet the efficiency requirement of the Energy Star Product Specification for Commercial Dishwashers, Version 1.1.
Any automatic commercial ice maker that was manufactured prior to January 1, 2010, that does not meet the efficiency requirement of the Energy Star Product Specification for Automatic Commercial Ice Makers, Version 1.0.
Any commercial clothes washer that was manufactured prior to January 1, 2010, that does not meet the efficiency requirement of the Energy Star Product Specification for Clothes Washers, Version 5.0.
“Noncompliant plumbing fixtures” and “water-conserving plumbing fixtures” have the same meanings set forth in Section 1101.3 of the Civil Code.
“Water-conserving appliance” means any of the following:
A commercial dishwasher that meets the criteria of the Energy Star Product Specification for Commercial Dishwashers, Version 2.0, or any revision to those criteria published by the United States Environmental Protection Agency that is adopted by the Energy Commission for the program.
An automatic commercial ice maker that meets the criteria of the Energy Star Product Specification for Automatic Commercial Ice Makers, Version 3.0, or any revision to those criteria published by the United States Environmental Protection Agency that is adopted by the Energy Commission for the program.
Any commercial clothes washer that meets the criteria of the Energy Star Product Specification for Clothes Washers, Version 8.0, or any revision to those criteria published by the United States Environmental Protection Agency that is adopted by the Energy Commission for the program.
The Energy Commission, in collaboration with each utility, shall develop and administer the School Noncompliant Plumbing Fixture and Appliance Program to provide grants to state agencies and local educational agencies to replace noncompliant plumbing fixtures and appliances that fail to meet water efficiency standards and waste potable water and the energy used to convey that water, with water-conserving plumbing fixtures and appliances.
On or before April 1, 2021, the Energy Commission shall issue a notice to local educational agencies of the availability of grants under the School Noncompliant Plumbing Fixture and Appliance Program and to invite local educational agencies to submit applications.
The Energy Commission shall award a grant pursuant to this article if an applicant submits documents showing the existence of noncompliant plumbing fixtures or appliances in the buildings for which the grant funding will be used and a cost estimate that is verified by a contractor for the replacement of the noncompliant plumbing fixtures and appliances with water-conserving plumbing fixtures and water-conserving appliances, and the applicant meets other requirements determined by the Energy Commission to be appropriate to achieve the purposes of this article.
As a condition of the grant, an applicant receiving a grant shall ensure that all construction work funded, in whole or in part, by the grants are performed by a skilled and trained workforce.
The Energy Commission is authorized to provide technical assistance or award grants pursuant to the School Noncompliant Plumbing Fixture and Appliance Program to assist local educational agencies in identifying noncompliant plumbing fixtures and noncompliant appliances eligible for replacement pursuant to this article.
ARTICLE 5. Repealer [1640. - 1640.]
This chapter shall remain in effect only until January 1, 2031, and as of that date is repealed.
CHAPTER 9. Hearings and Judicial Review [1701. - 1826.]
ARTICLE 1. Hearings [1701. - 1711.]
All hearings, investigations, and proceedings shall be governed by this part and by rules of practice and procedure adopted by the commission, and in the conduct thereof the technical rules of evidence need not be applied. No informality in any hearing, investigation, or proceeding or in the manner of taking testimony shall invalidate any order, decision, or rule made, approved, or confirmed by the commission.
Notwithstanding Section 11425.10 of the Government Code, Articles 1 to 15, inclusive, of Chapter 4.5 (commencing with Section 11400) of Part 1 of Division 3 of Title 2 of the Government Code do not apply to a hearing by the commission under this code. The Administrative Adjudication Code of Ethics (Article 16 (commencing with Section 11475) of Chapter 4.5 of Part 1 of Division 3 of Title 2 of the Government Code) shall apply to administrative law judges of the commission.
The commission shall determine whether each proceeding is a quasi-legislative, an adjudication, a ratesetting, or a catastrophic wildfire proceeding. The commission’s decision as to the nature of the proceeding shall be subject to a request for rehearing within 10 days of the date of that decision or of any subsequent ruling that expands the scope of the proceeding. Only those parties who have requested a rehearing within that time period shall subsequently have standing for judicial review and that review shall only be available at the conclusion of the proceeding. The commission shall render its decision regarding the rehearing within 30 days. The commission shall establish rules regarding ex parte communication on case categorization issues.
The commission, upon initiating an adjudication proceeding or ratesetting proceeding, shall assign one or more commissioners to oversee the case and an administrative law judge when appropriate. The assigned commissioner shall schedule a prehearing conference and shall prepare and issue by order or ruling a scoping memo that describes the issues to be considered and the applicable timetable for resolution and that, consistent with due process, public policy, and statutory requirements, determines whether the proceeding requires a hearing.
The administrative law judge shall either preside over and conduct, or assist the assigned commissioner or commissioners in presiding over and conducting, any evidentiary or adjudication hearing that may be required.
This subdivision shall not apply to exempt railroad crossing applications subject to Section 1205.5.
The commission, upon initiating a quasi-legislative proceeding, shall assign one or more commissioners to oversee the case and an administrative law judge, when appropriate, who may be assisted by a technical advisory staff member in conducting the proceeding. The assigned commissioner shall prepare and issue by order or ruling a scoping memo that describes the issues to be considered and the applicable timetable for resolution and that, consistent with due process, public policy, and statutory requirements, determines whether the proceeding requires a hearing.
“Ex parte communication,” for purposes of this article, means any oral or written communication between a decisionmaker and an interested person concerning any matter before the commission that the commission has not specified in its Rules of Practice and Procedure as being a procedural matter and that does not occur in a public hearing, workshop, or other public proceeding, or on the official record of the proceeding on the matter. The commission shall specify in its Rules of Practice and Procedure, enacted by rulemaking, the types of issues considered procedural matters under this article.
“Interested person,” for purposes of this article, means any of the following:
Any applicant, an agent or an employee of the applicant, or a person receiving consideration for representing the applicant, or a participant in the proceeding on any matter before the commission.
Any person with a financial interest, as described in Article 1 (commencing with Section 87100) of Chapter 7 of Title 9 of the Government Code, in a matter before the commission, an agent or employee of the person with a financial interest, or a person receiving consideration for representing the person with a financial interest. A person involved in issuing credit ratings or advising entities or persons who invest in the shares or operations of any party to a proceeding is a person with a financial interest.
A representative acting on behalf of any civic, environmental, neighborhood, business, labor, trade, or similar organization who intends to influence the decision of a commission member on a matter before the commission.
Other categories of individuals deemed by the commission, by rule, to be an interested person.
The commission shall by rule adopt and publish a definition of decisionmakers and interested persons for purposes of this article, along with any requirements for written reporting of ex parte communications and appropriate sanctions for noncompliance with any rule proscribing ex parte communications. The definition of decisionmakers shall include, but is not limited to: each commissioner; the personal staff of a commissioner if the staff is acting in a policy or legal advisory capacity; the chief administrative law judge of the commission; and the administrative law judge assigned to the proceeding. The commission shall, by rule, explicitly ban both of the following:
The practice of one-way ex parte communications from a decisionmaker to an interested person.
Any communication between an interested person and a decisionmaker regarding which commissioner or administrative law judge may be assigned to a matter before the commission.
For adjudication cases, the rules shall provide that ex parte communications shall be prohibited, as required by this article. The rules shall provide that if an ex parte communication occurs that is prohibited by this article, or if an ex parte communication occurs in a ratesetting case or catastrophic wildfire proceeding, whether initiated by a decisionmaker or an interested person, all of the following shall be required:
The interested person shall report the communication within three working days of the communication by filing a notice with the commission that includes all the following:
The date, time, and location of the communication, whether the communication was oral or written, or a combination of both, and the communication medium used.
The identity of the decisionmaker, the identity of the person initiating the communication, and the identities of any other persons present.
The topic of the communication, including applicable proceeding numbers.
A substantive description of the interested person’s communication and its content.
A copy of any written material or text used during the communication.
Any decisionmaker who participated in the communication shall promptly log the ex parte communication by filing a notice that includes all the following:
The date, time, and location of the communication, whether the communication was oral or written, or a combination of both, and the communication medium used.
The identity of the interested person, the identity of the person initiating the communication, and the identities of any other persons present.
The topic of the communication, including any applicable proceeding numbers.
A brief description of the communication.
If the interested person who participated in the communication has not timely submitted the notice required by subparagraph (A), the decisionmaker shall refer the matter to the attorney for the commission, and an assigned commissioner, by ruling, shall order the interested person to submit the required notice. The interested person shall be subject to any applicable penalties for the initial violation and, if the interested person does not submit the required notice within the time period specified in the assigned commissioner’s ruling, the interested person shall be subject to continuing violations pursuant to Section 2108.
The requirements of paragraph (3) shall not apply to any oral ex parte communication occurring at a meeting if all parties are invited to participate and given not less than three working days’ notice.
The commission shall not take any vote on a matter in which a notice of a prohibited ex parte communication has been filed pursuant to subparagraph (A) or (B) of paragraph (3) until all parties to the proceeding have been provided a reasonable opportunity to respond to the communication.
If an ex parte communication is not disclosed as required by this subdivision until after the commission has issued a decision on the matter to which the communication pertained, a party not participating in the communication may file a petition to rescind or modify the decision. The party may seek a finding that the ex parte communication significantly influenced the decision’s process or outcome as part of any petition to rescind or modify the decision. The commission shall process the petition in accordance with the commission’s procedures for petitions for modification and shall issue a decision on the petition no later than 180 days after the filing of the petition.
Ex parte communications that occur at conferences and that are within the scope of an adjudication, ratesetting, or catastrophic wildfire proceeding shall be subject to the requirements of this article.
Ex parte communications that occur at conferences and that are within the scope of a quasi-legislative proceeding shall be governed by the ex parte communication disclosure requirements developed by the commission.
For purposes of this section, “ex parte communications that occur at conferences” includes, but is not limited to, communications in a private setting or during meals, entertainment events, and tours, and informal discussions among conference attendees.
The commission shall render its decisions based on the law and on the evidence in the record. Ex parte communications shall not be a part of the evidentiary record of the proceedings.
The commission may meet in a closed session to discuss administrative matters so long as no collective consensus is reached or vote taken on any matter requiring a vote of the commissioners. The commission shall, by rule, adopt and publish a definition of “administrative matters” for purposes of this section.
The commission shall permit written comments received from the public to be included in the record of its proceedings, but the comments shall not be treated as evidence. The commission shall provide parties to the proceeding a reasonable opportunity to respond to any public comments included in the record of proceedings.
It is the intent of the Legislature that the commission, and any entity or person seeking to influence actions taken by the commission, shall be subject to all applicable ethical standards, including any applicable obligations under the Political Reform Act of 1974 (Title 9 (commencing with Section 81000) of the Government Code), including, but not limited to, any applicable lobbying obligations.
This section shall apply to adjudication cases only.
If the commissioner assigned pursuant to subdivision (b) of Section 1701.1 has determined that an adjudication case requires a hearing, the assigned commissioner or the assigned administrative law judge shall hear the case in the manner described in the scoping memo. The scoping memo shall designate whether the assigned commissioner or the assigned administrative law judge shall preside in the case.
The commission shall provide by rule for peremptory challenges and challenges for cause of the administrative law judge. Challenges for cause shall include, but not be limited to, financial interests and prejudice. The rule shall provide that all parties are entitled to one peremptory challenge of the assignment of the administrative law judge in all cases. All parties are entitled to unlimited peremptory challenges in any case in which the administrative law judge has within the previous 12 months served in any capacity in an advocacy position at the commission, been employed by a regulated public utility, or has represented a party or has been an interested person in the case.
The assigned commissioner or the administrative law judge shall prepare and file a decision setting forth recommendations, findings, and conclusions. The decision shall be filed with the commission and served upon all parties to the action or proceeding without undue delay, not later than 60 days after the matter has been submitted for decision. The decision of the assigned commissioner or the administrative law judge shall become the decision of the commission if no further action is taken within 30 days. Any party may appeal the decision to the commission, provided that the appeal is made within 30 days of the issuance of the decision. The commission may itself initiate a review of the proposed decision on any grounds.
The commission’s decision shall be supported by findings of fact on all issues material to the decision, and the findings of fact shall be based on the record developed by the assigned commissioner or the administrative law judge. A decision different from that of the assigned commissioner or the administrative law judge shall be accompanied by a written explanation of each of the changes made to the decision.
Notwithstanding Section 307, an officer, employee, or agent of the commission that is personally involved in the prosecution or in the supervision of the prosecution of an adjudication case before the commission shall not participate in the decision of the case or any factually related adjudicatory proceeding, including participation in or advising the commission as to findings of fact, conclusions of law, or orders. An officer, employee, or agent of the commission that is personally involved in the prosecution or in the supervision of the prosecution of an adjudication case may participate in reaching a settlement of the case, but shall not participate in the decision of the commission to accept or reject the settlement, except as a witness or counsel in an open hearing or a hearing closed pursuant to subdivision (h). The Legislature finds that the commission performs both prosecutorial and adjudicatory functions in an adjudication case and declares its intent that an officer, employee, or agent of the commission, including its attorneys, may perform only one of those functions in any adjudication case or factually related adjudicatory proceeding.
Ex parte communications shall be prohibited in adjudication cases.
Any oral or written communications concerning procedural matters in adjudication cases between interested persons and decisionmakers, except the assigned administrative law judge, shall be prohibited.
Notwithstanding any other law, the commission may meet in a closed hearing to consider the decision that is being appealed. The vote on the appeal shall be in a public meeting and shall be accompanied with an explanation of the appeal decision.
Adjudication cases shall be resolved within 12 months of initiation unless the commission makes findings why that deadline cannot be met and issues an order extending that deadline. In the event that a rehearing of an adjudication case is granted, the parties shall have an opportunity for final oral argument.
The commission may determine that the respondent lacks, or may lack, the ability to pay potential penalties, fines, or restitution that may be ordered by the commission.
If the commission determines that a respondent lacks, or may lack, the ability to pay, the commission may order the respondent to demonstrate, to the satisfaction of the commission, sufficient ability to pay potential penalties, fines, or restitution that may be ordered by the commission. The respondent shall demonstrate the ability to pay, or make other financial arrangements satisfactory to the commission, within seven days of the commission commencing an adjudication case. The commission may delegate to the attorney to the commission the determination of whether a sufficient showing has been made by the respondent of an ability to pay.
Within seven days of the commission’s determination of the respondent’s ability to pay potential penalties, fines, or restitution, the respondent shall be entitled to an impartial review by an administrative law judge of the sufficiency of the showing made by the respondent of the respondent’s ability to pay. The review by an administrative law judge of the ability of the respondent to pay shall become part of the record of the adjudication and is subject to the commission’s consideration in its order resolving the adjudication case. The administrative law judge may enter temporary orders modifying any financial requirement made of the respondent pending the review by the administrative law judge.
A respondent that is a public utility regulated under a rate of return or rate of margin regulatory structure or that has gross annual revenues of more than one hundred million dollars ($100,000,000) generated within California is presumed to be able to pay potential penalties, fines, or restitution that may be ordered by the commission, and, therefore, paragraphs (1) to (3), inclusive, do not apply to that respondent.
Except as specified in subdivision (h), this section shall apply only to ratesetting cases, except, if the commissioner assigned pursuant to Section 1701.1 has determined that a ratesetting case does not require a hearing, the procedures prescribed by subdivisions (b), (d), (f), and (i) shall not apply.
The assigned commissioner shall determine before the first hearing whether the commissioner or the assigned administrative law judge shall be designated as the principal hearing officer. The principal hearing officer shall be present for more than one-half of the hearing days. The decision of the principal hearing officer shall be the proposed decision.
An alternate decision may be issued by the assigned commissioner or the assigned administrative law judge who is not the principal hearing officer. Any alternate decision may be filed with the commission and served on all parties to the proceeding any time before the issuance of a final decision by the commission, consistent with the requirements of Section 311.
The commission shall establish a procedure for any party to request the presence of a commissioner at a hearing. The assigned commissioner shall be present at any closing arguments in the case.
The principal hearing officer shall present the proposed decision to the full commission in a public meeting. The alternate decision, if any, shall also be presented to the full commission at that public meeting.
The presentation to the full commission shall contain a record of the number of days of the hearing, the number of days that each commissioner was present, and whether the decision was completed on time.
The commission shall provide by rule for peremptory challenges and challenges for cause of the administrative law judge. Challenges for cause shall include, but not be limited to, financial interests and prejudice. All parties shall be entitled to unlimited peremptory challenges in any case in which the administrative law judge has within the previous 12 months served in any capacity in an advocacy position at the commission, been employed by a regulated public utility, or has represented a party or has been an interested person in the case.
Ex parte communications in ratesetting cases and catastrophic wildfire proceedings are subject to the disclosure requirements of this article. The commission, by order or ruling, may prohibit oral ex parte communications in a ratesetting case or catastrophic wildfire proceeding.
Oral communications may be permitted by a decisionmaker if all parties are given not less than three working days’ notice. Individual ex parte meetings shall not be held during the three business days before the commission’s scheduled vote on the decision.
If an ex parte communication meeting is granted to any party, all other parties, upon request, shall also be granted individual ex parte meetings of a substantially equal period of time and shall be sent a notice of that opportunity at the time the request is granted.
Subparagraph (A) shall not apply if the decisionmaker participating in the ex parte communication meeting is a member of the personal staff of a commissioner acting in a policy or legal advisory capacity and no other decisionmaker to whom subparagraph (A) applies is a participant.
Written ex parte communications by an interested person shall be permitted at any time without restriction before the three business days before the commission’s scheduled vote on a decision if copies of the communication are transmitted to all parties on the same day as the original communication.
Written and oral ex parte communications shall not be part of the evidentiary record of the proceeding.
Any party has the right to present a final oral argument of its case before the commission. Upon request to present a final oral argument before the commission, the argument shall be scheduled in a timely manner. A quorum of the commission shall be present for the final oral arguments.
The commission may, in issuing its decision, adopt, modify, or set aside the proposed decision or any part of the decision based on evidence in the record. The final decision of the commission shall be issued not later than 60 days after the issuance of the proposed decision. Under extraordinary circumstances the commission may extend this date for a reasonable period. The 60-day period shall be extended for 30 days if any alternate decision is proposed pursuant to Section 311.
This section shall apply only to quasi-legislative cases, except, if the commissioner assigned pursuant to Section 1701.1 has determined that a quasi-legislative case does not require a hearing, the procedures prescribed by subdivisions (b), (d), and (e) shall not apply.
The assigned administrative law judge and any assigned technical advisory staff shall act as an assistant to the assigned commissioner in quasi-legislative cases. The assigned commissioner shall prepare the proposed rule or order with the assistance of the administrative law judge and any assigned technical advisory staff. The assigned commissioner shall present the proposed rule or order to the full commission in a public meeting. The report shall include the number of days of hearing and the number of days that the commissioner was present.
Ex parte communications in quasi-legislative proceedings are permitted and not subject to the disclosure requirements of this article, except when the commission, by order or ruling, determines either of the following:
That ex parte communications are subject to the disclosure requirements of this article.
That ex parte communications are prohibited and subject to the disclosure requirements of this article.
Any party has the right to present a final oral argument of its case before the commission. Those requests shall be scheduled in a timely manner. A quorum of the commission shall be present for the final oral arguments.
The commission may, in issuing its rule or order, adopt, modify, or set aside the proposed decision or any part of the rule or order. The final rule or order of the commission shall be issued not later than 60 days after the issuance of the proposed rule or order. Under extraordinary circumstances the commission may extend this date for a reasonable period. The 60-day period shall be extended for 30 days if any alternate rule or order is proposed pursuant to Section 311.
No informality in the manner of taking testimony or evidence shall invalidate any order, decision, or rule made, approved, or confirmed by the commission in quasi-legislative cases.
Except as specified in subdivision (b), in a ratesetting or quasi-legislative case, the commission shall resolve the issues raised in the scoping memo within 18 months of the date the proceeding is initiated, unless the commission makes a written determination that the deadline cannot be met, including findings as to the reason, and issues an order extending the deadline.
Notwithstanding subdivision (a), the commission may specify in a scoping memo a resolution date later than 18 months from the date the proceeding is initiated, if that scoping memo includes specific reasons for the necessity of a later date and the commissioner assigned to the case approves the date.
In addition to any penalty, fine, or other punishment applicable pursuant to Chapter 11 (commencing with Section 2100), the commission may assess civil sanctions upon any entity or person, other than a decisionmaker or employee of the commission, who violates, fails to comply with, or procures, aids, or abets any violation of, the ex parte communication requirements of this article or those adopted by the commission pursuant to this article. The civil sanctions may include civil penalties, adverse consequences in commission proceedings, or other appropriate commission orders directed at the entity, person, or both the entity and person, committing the violation.
Except as provided in paragraph (2), a civil penalty assessed shall not exceed fifty thousand dollars ($50,000) per violation. Each day of a continuing violation is a separate violation. If the violation consists of engaging in a communication that is prohibited by the ex parte communication requirements, each day that the violation is not disclosed to the commission and to parties of record in the formal proceeding in which the communication occurred shall constitute a separate violation.
If the entity or person may obtain, by violating the ex parte communication requirements, financial benefits that exceed the maximum amount of civil penalty allowable pursuant to paragraph (1), the commission may impose a civil penalty up to the amount of those financial benefits.
Civil penalties assessed pursuant to subdivision (b) upon entities whose rates are determined by the commission shall be in the form of credits to the customers of that entity. Civil penalties collected from other entities shall be deposited into the General Fund.
In determining the appropriate civil sanctions, the commission shall consider the following factors:
The financial resources of the entity or person.
The totality of the circumstances in furtherance of the public interest.
The Attorney General may bring an enforcement action in superior court against a decisionmaker or employee of the commission who knowingly and willfully violates, fails to comply with, or procures, aids or abets any violation of, the ex parte communication requirements in this article or those adopted by the commission pursuant to this article.
In determining the appropriate relief, the court may consider the following factors:
The severity of the violation.
The conduct of the decisionmaker or employee.
The financial resources of the decisionmaker or employee.
The totality of the circumstances in furtherance of the public interest.
The Attorney General may compromise the enforcement action subject to approval by the court.
Civil penalties collected pursuant to this section shall be deposited into the Litigation Deposits Fund established pursuant to Article 9 (commencing with Section 16425) of Chapter 2 of Part 2 of Division 4 of Title 2 of the Government Code.
For purposes of this section, the following definitions apply:
“Covered wildfire” means any wildfire ignited on or after July 12, 2019, for which either of the following is satisfied:
The governmental agency responsible for determining causation or a court of competent jurisdiction determines the wildfire was caused by an electrical corporation.
Asserted to have been caused by an electrical corporation and results in a court-approved dismissal resulting from the settlement of third-party damage claims.
“Wildfire Fund” means the Wildfire Fund created pursuant to Section 3284.
The following procedures and standards apply to a catastrophic wildfire proceeding:
An electrical corporation may file an application pursuant to Section 451 or 451.1, as applicable, at any time after it has paid, or entered into binding commitments to pay, all or, if authorized by the commission for good cause, substantially all third-party damage claims, including payments made pursuant to judgments or settlement agreements related to a covered wildfire. Except as authorized by the commission for good cause, before filing the application, the electrical corporation shall exhaust all rights to indemnification or other claims, contractual or otherwise, against any third parties, including collecting insurance proceeds, related to the covered wildfire.
If an electrical corporation has received payments from the Wildfire Fund for a third-party damage claim for the covered wildfire, the electrical corporation shall file an application to recover the costs pursuant to subparagraph (A) no later than the earlier of the following:
The date when it has resolved all third-party damage claims and exhausted all right to indemnification or other claims, contractual or otherwise, against any third parties, including collecting insurance proceeds, related to the covered wildfire.
The date that is 45 days after the date the administrator requests the electrical corporation to file the application.
If an electrical corporation issues recovery bonds authorized pursuant to a financing order issued pursuant to clause (ii) of subparagraph (A) of paragraph (1) of subdivision (a) of Section 850.1, the electrical corporation shall file an application pursuant to subparagraph (A) for a determination of the just and reasonableness of the costs and expenses included in the recovery bonds no later than the earlier of the following:
The date when the electrical corporation has resolved all third-party damage claims and exhausted all rights to indemnification or other claims, contractual or otherwise, against any third parties, including collecting insurance proceeds, related to the covered wildfire.
The date that is 45 days after the date the commission requests the electrical corporation to file the application.
The president of the commission, upon the initiation of a catastrophic wildfire proceeding by the filing of an application pursuant to paragraph (1), shall assign a commissioner to act as the presiding officer in the proceeding and an administrative law judge to assist in conducting the proceeding.
Within 15 days of the filing date of the application, the commission shall notice a prehearing conference, which shall be held within 25 days of the filing date.
Within 30 days of the filing date of the application, the assigned commissioner shall prepare and issue, by order or ruling, a scoping memorandum that states that the scope of the proceeding shall be whether the electrical corporation’s costs and expenses for the covered wildfire are just and reasonable pursuant to Section 451 or 451.1, as applicable.
The scoping memorandum shall establish a schedule for the proceeding, including the date of issuance of a proposed decision that is no later than 12 months after the filing date of the application.
The assigned commissioner may extend the time established in the scoping memorandum for the date of issuance of a proposed decision by up to six months upon a showing of good cause.
The following provisions apply during the pendency of a commission proceeding, except these provisions do not apply during an adjudicatory or quasi-legislative proceeding:
The commission may meet in closed session to deliberate on a proposed decision, order, or resolution after providing three-day advance notice to the public.
The commission shall establish a quiet period during the three business days before the commission’s scheduled vote on a decision, during which oral ex parte communications shall not be permitted.
The requirement specified in subparagraph (F) of paragraph (1) of subdivision (b) of Section 11123 of the Government Code shall not apply to a meeting of the commission during a quiet period that is held by teleconference.
If the commission materially modifies a proposed decision during the first two business days of the three-day quiet period before the commission’s scheduled vote on the proposed decision, an interested person may submit a written ex parte communication during those two business days if copies of the written ex parte communication are concurrently transmitted to all parties at the same time as the written ex parte communication is submitted to the commission and the scope of the written ex parte communication is limited to the portion of the proposed decision that was materially modified.
If the commission materially modifies a proposed decision during the last business day of the three-day quiet period before the commission’s scheduled vote on the proposed decision, an interested person may submit a written ex parte communication on that day if copies of the written ex parte communication are concurrently transmitted to all parties at the same time as the written ex parte communication is submitted to the commission and the scope of the written ex parte communication is limited to the portion of the proposed decision that was materially modified.
Complaint may be made by the commission of its own motion or by any corporation or person, chamber of commerce, board of trade, labor organization, or any civic, commercial, mercantile, traffic, agricultural, or manufacturing association or organization, or any body politic or municipal corporation, by written petition or complaint, setting forth any act or thing done or omitted to be done by any public utility, including any rule or charge heretofore established or fixed by or for any public utility, in violation or claimed to be in violation, of any provision of law or of any order or rule of the commission. No complaint shall be entertained by the commission, except upon its own motion, as to the reasonableness of any rates or charges of any gas, electrical, water, or telephone corporation, unless it is signed by the mayor or the president or chairman of the board of trustees or a majority of the council, commission, or other legislative body of the city or city and county within which the alleged violation occurred, or by not less than 25 actual or prospective consumers or purchasers of such gas, electricity, water, or telephone service.
The commission shall entertain complaints against any electrical, gas, water, heat, or telephone company under Sections 734, 735, and 736 when the amount of money claimed does not exceed the jurisdictional limit of the small claims court as set forth in subdivision (a) of Section 116.220 or Section 116.221 of the Code of Civil Procedure. However, when the public interest so requires, the commission or presiding officer may, at any time prior to the filing of a decision, terminate the expedited complaint procedure and recalendar the matter for hearing under the commission’s regular procedure.
No attorney at law shall represent any party other than himself or herself under the expedited complaint procedure.
No pleading other than the complaint and answer is necessary. A hearing without a reporter shall be held within 30 days after the answer is filed.
The parties may file applications for rehearing pursuant to Section 1731. If the commission grants an application for rehearing, the rehearing shall be conducted under the commission’s regular hearing procedure.
Except as provided in subdivision (b), any funds entrusted to the commission by any person or corporation filing a complaint against a public utility shall be deposited in trust by the commission in the custody of the Treasurer, as specified in Section 16305.3 of the Government Code.
If the amount of the funds entrusted to the commission by a person or corporation filing a complaint against a public utility exceeds twenty thousand dollars ($20,000), the commission may deposit the funds in trust in an insured account with a bank or a federal or state savings and loan association, bearing interest at rates up to the maximum permitted by law. The commission shall pay these funds, together with the interest paid thereon, to the party specified in the commission’s order or decision on that complaint.
The commission shall, in an existing or new proceeding, develop and implement a safety enforcement program applicable to gas corporations and electrical corporations which includes procedures for monitoring, data tracking and analysis, and investigations, as well as issuance of citations by commission staff, under the direction of the executive director. The enforcement program shall be designed to improve gas and electrical system safety through the enforcement of applicable law, or order or rule of the commission related to safety using a variety of enforcement mechanisms, including the issuance of corrective actions, orders, and citations by designated commission staff, and recommendations for action made to the commission by designated commission staff.
When considering the issuance of citations and assessment of penalties, the commission staff shall take into account voluntary reporting of potential violations, voluntary removal or resolution efforts undertaken, the prior history of violations, the gravity of the violation, and the degree of culpability.
The procedures shall include, but are not limited to, providing notice of violation within a reasonable period of time after the discovery of the violation.
The commission shall adopt an administrative limit on the amount of monetary penalty that may be set by commission staff.
The commission shall develop and implement an appeals process to govern the issuance and appeal of citations or resolution of corrective action orders issued by the commission staff. The appeals process shall provide the respondent a reasonable period of time, upon receiving a citation, to file a notice of appeal, shall afford an opportunity for a hearing, and shall require the hearing officer to expeditiously provide a draft disposition.
The commission shall, within a reasonable time set by the commission, conclude a safety enforcement action with a finding of violation, a corrective action order, a citation, a determination of no violation, approval of the corrective actions undertaken by the gas corporation or electrical corporation, or other action. The commission may institute a formal proceeding regarding the alleged violation, potentially resulting in additional enforcement action, regardless of any enforcement action taken at the commission staff level.
The commission shall implement the safety enforcement program for gas safety by July 1, 2014, and implement the safety enforcement program for electrical safety no later than January 1, 2015.
This section does not apply to an exempt wholesale generator, a qualifying small power producer, or qualifying cogenerator, as defined in Section 796 of Title 16 of the United States Code and the regulations enacted pursuant thereto. Nothing in this section affects the commission’s authority pursuant to Section 761.3.
All matters upon which complaint may be founded may be joined in one hearing, and no motion shall be entertained against a complaint for misjoinder of causes of action or grievances or misjoinder or nonjoinder of parties. In any review by the courts of orders or decisions of the commission the same rule shall apply with regard to the joinder of causes and parties as herein provided. The commission shall not be required to dismiss any complaint because of the absence of direct damage to the complainant.
Upon the filing of a complaint, the commission shall cause a copy thereof to be served upon the corporation or person complained of. Service in all hearings, investigations, and proceedings pending before the commission may be made upon any person upon whom a summons may be served in accordance with the provisions of the Code of Civil Procedure, and may be made personally or by mailing in a sealed envelope, registered, with postage prepaid. The commission shall fix the time when and place where a hearing will be had upon the complaint and shall serve notice thereof, not less than 10 days before the time set for such hearing, unless the commission finds that public necessity requires that such hearing be held at an earlier date.
At the time fixed for any hearing before the commission or a commissioner, or the time to which the hearing has been continued, the complainant and the corporation or person complained of, and such corporations or persons as the commission allows to intervene, shall be entitled to be heard and to introduce evidence. The commission shall issue process to enforce the attendance of all necessary witnesses. After the conclusion of the hearing, the commission shall make and file its order, containing its decision. Except for decisions filed after hearings held under Section 1702.1, the decision shall contain, separately stated, findings of fact and conclusions of law by the commission on all issues material to the order or decision. A copy of such order, certified under the seal of the commission, shall be served upon the corporation or person complained of, or his or its attorney. The order shall, of its own force, take effect and become operative 20 days after the service thereof except as otherwise provided by the commission, and shall continue in force either for a period designated in it or until changed or abrogated by the commission. If the commission believes that an order cannot be complied with within 20 days, it may prescribe such additional time as in its judgment is reasonably necessary to comply with the order, and may on application and for good cause shown, extend the time for compliance fixed in its order. Decisions rendered in response to complaints filed and processed pursuant to Section 1702.1 shall not be considered as precedent or binding on the commission or the courts of this state.
A complete record of all proceedings and testimony before the commission or any commissioner on any formal hearing shall be taken down by a reporter appointed by the commission, and the parties shall be entitled to be heard in person or by attorney. In case of an action to review any order or decision of the commission, a transcript of that testimony, together with all exhibits or copies thereof introduced, and of the pleadings, record, and proceedings in the cause, shall constitute the record of the commission, but if the petitioner and the commission stipulate that certain questions alone and a specified portion only of the evidence shall be certified to the Supreme Court or the court of appeal for its judgment, the stipulation and the questions and the evidence therein specified shall constitute the record on review. The provisions of this section shall not apply to hearings held pursuant to Section 1702.1.
Any public utility may complain on any of the grounds upon which complaints are allowed to be filed by other parties, and the same procedure shall be adopted and followed as in other cases, except that the complaint may be heard ex parte by the commission or may be served upon any parties designated by the commission.
The commission may at any time, upon notice to the parties, and with opportunity to be heard as provided in the case of complaints, rescind, alter, or amend any order or decision made by it. Any order rescinding, altering, or amending a prior order or decision shall, when served upon the parties, have the same effect as an original order or decision.
The commission shall permit interested persons to petition the commission to adopt, amend, or repeal a regulation.
The commission shall consider a petition and, within six months from the date of receipt of the petition, either deny the petition or institute a proceeding to adopt, amend, or repeal the regulation.
The commission may extend the six month period for consideration of a petition pursuant to paragraph (1) to allow public review and comment pursuant to subdivision (g) of Section 311.
If the commission denies a petition, the order or resolution of the commission shall include a statement of the reasons of the commission for that denial.
If the commission finds that it is precluded by law from granting a petition, the statement of reasons for denial pursuant to subdivision (c) shall identify the relevant provisions of law.
The commission shall implement this section under the Rules of Practice and Procedure in effect on January 1, 2000. On or before July 1, 2001, the commission shall amend the Rules of Practice and Procedure to provide more specific procedures for handling a petition pursuant to this section.
Notwithstanding Section 1708, the commission may conduct any proceeding to adopt, amend, or repeal a regulation using notice and comment rulemaking procedures, without an evidentiary hearing, except with respect to a regulation being amended or repealed that was adopted after an evidentiary hearing, in which case the parties to the original proceeding shall retain any right to an evidentiary hearing accorded by Section 1708.
In all collateral actions or proceedings, the orders and decisions of the commission which have become final shall be conclusive.
No documents or records of a public utility or person or corporation which purport to be statements of fact shall be admitted into evidence or shall serve as any basis for the testimony of any witness, unless the documents or records have been certified under penalty of perjury by the person preparing or in charge of preparing them as being true and correct. If the person preparing them is dead or has been declared incompetent, any other person having knowledge of such statements of fact may certify the records. If certification pursuant to this section is not possible for any reason, the documents or records shall not be admitted into evidence unless admissible under the Evidence Code.
This section shall not apply to any documents not prepared, directly or indirectly, by, or under the supervision or direction of, the public utility or person or corporation offering the documents into evidence.
Where feasible and appropriate, except for adjudication cases, before determining the scope of the proceeding, the commission shall seek the participation of those who are likely to be affected, including those who are likely to benefit from, and those who are potentially subject to, a decision in that proceeding. The commission shall demonstrate its efforts to comply with this section in the text of the initial scoping memo of the proceeding.
The Policy and Planning Division of the commission shall undertake one or more studies of outreach efforts undertaken by other state and federal utility regulatory bodies and make recommendations to the commission to promote effective outreach, including metrics for use in evaluating success.
This subdivision shall remain in effect only until January 1, 2020, and shall have no force or effect on or after that date, unless a later enacted statute that is chaptered before January 1, 2020, deletes or extends that date.
ARTICLE 2. Rehearings [1731. - 1736.]
The commission shall set an effective date when issuing an order or decision. The commission may set the effective date of an order or decision before the date of issuance of the order or decision.
After an order or decision has been made by the commission, a party to the action or proceeding, or a stockholder, bondholder, or other party pecuniarily interested in the public utility affected, may apply for a rehearing in respect to matters determined in the action or proceeding and specified in the application for rehearing. The commission may grant and hold a rehearing on those matters, if in its judgment sufficient reason is made to appear. A cause of action arising out of any order or decision of the commission shall not accrue in any court to any corporation or person unless the corporation or person has filed an application to the commission for a rehearing within 30 days after the date of issuance or within 10 days after the date of issuance in the case of an order issued pursuant to either Article 5 (commencing with Section 816) or Article 6 (commencing with Section 851) of Chapter 4 relating to security transactions and the transfer or encumbrance of utility property.
The commission shall notify the parties of the issuance of an order or decision by either mail or electronic transmission. Notification of the parties may be accomplished by one of the following methods:
Mailing the order or decision to the parties to the action or proceeding.
If a party to an action or proceeding consents in advance to receive notice of any order or decision related to the action or proceeding by electronic mail address, notification of the party may be accomplished by transmitting an electronic copy of the official version of the order or decision to the party if the party has provided an electronic mail address to the commission.
If a party to an action or proceeding consents in advance to receive notice of any order or decision related to the action or proceeding by electronic mail address, notification of the party may be accomplished by transmitting a link to an internet website where the official version of the order or decision is readily available to the party if the party has provided an electronic mail address to the commission.
For purposes of this article, “date of issuance” means the mailing or electronic transmission date that is stamped on the official version of the order or decision.
A cause of action arising out of an order or decision of the commission construing, applying, or implementing Chapter 4 of the Statutes of the 2001–02 First Extraordinary Session that (1) relates to the determination or implementation of the department’s revenue requirements, or the establishment or implementation of bond or power charges necessary to recover those revenue requirements, or (2) in the sole determination of the Department of Water Resources, the expedited review of order or decision of the commission is necessary or desirable, for the maintenance of any credit ratings on any bonds or notes of the department issued pursuant to Division 27 (commencing with Section 80000) of the Water Code or for the department to meet its obligations with respect to any bonds or notes pursuant to that division, shall not accrue in any court to any corporation or person unless the corporation or person has filed an application with the commission for a rehearing within 10 days after the date of issuance of the order or decision. The Department of Water Resources shall notify the commission of any determination pursuant to paragraph (2) of this subdivision before the issuance by the commission of any order or decision construing, applying, or implementing Chapter 4 of the Statutes of the 2001–02 First Extraordinary Session. The commission shall issue its decision and order on rehearing within 210 days after the filing of the application.
A cause of action arising out of an order or decision of the commission construing, applying, or implementing Article 5.7 (commencing with Section 849) or Article 5.8 (commencing with Section 850) of Chapter 4 shall not accrue in any court to any entity or person unless the entity or person has filed an application to the commission for a rehearing within 10 days after the date of issuance of the order or decision. The commission shall issue its decision and order on rehearing within 210 days after the filing of that application.
A cause of action arising out of an executive director disposition of a protest to a General Order 131-D notice of proposed construction deemed exempt from the requirement to submit an application for a permit or certificate for an electrical transmission facility shall not accrue in any court to any entity or person unless the entity or person has filed an application to the commission for a rehearing within 10 days after the date of issuance of the disposition. The commission shall issue its decision and order on rehearing within 90 days after the filing of that application.
The application for a rehearing shall set forth specifically the ground or grounds on which the applicant considers the decision or order to be unlawful. No corporation or person shall in any court urge or rely on any ground not so set forth in the application.
Any application for a rehearing made 10 days or more before the effective date of the order as to which a rehearing is sought, shall be either granted or denied before the effective date, or the order shall stand suspended until the application is granted or denied; but, absent further order of the commission the order shall not stand so suspended for more than 60 days after the date of filing of the application, at which time the suspension shall lapse, the order shall become effective, and the application may be taken by the party making it to be denied.
Any application for a rehearing made within less than 10 days before the effective date of the order as to which a rehearing is sought, and not granted within 60 days, may be taken by the party making the application to be denied, unless the effective date of the order is extended for the period of the pendency of the application.
If any application for a rehearing is granted without a suspension of the order involved, the commission shall forthwith proceed to hear the matter with all dispatch and shall determine the matter within 20 days after final submission. If no determination is made within that time, it may be taken by any party to the rehearing that the order involved is affirmed.
An application for rehearing shall not excuse any corporation or person from complying with and obeying any order or decision, or any requirement of any order or decision of the commission theretofore made, or operate in any manner to stay or postpone the enforcement thereof, except in such cases and upon such terms as the commission by order directs.
If, after such rehearing and a consideration of all the facts, including those arising since the making of the order or decision, the commission is of the opinion that the original order or decision or any part thereof is in any respect unjust or unwarranted, or should be changed, the commission may abrogate, change, or modify it. The order or decision abrogating, changing, or modifying the original order or decision shall have the same force and effect as an orginal order or decision, but shall not affect any right or the enforcement of any right arising from or by virtue of the original order or decision unless so ordered by the commission.
ARTICLE 3. Judicial Review [1756. - 1770.]
Within 30 days after the commission issues its decision denying the application for a rehearing, or, if the application was granted, then within 30 days after the commission issues its decision on rehearing, or at least 120 days after the application is granted if no decision on rehearing has been issued, any aggrieved party may petition for a writ of review in the court of appeal or the Supreme Court for the purpose of having the lawfulness of the original order or decision or of the order or decision on rehearing inquired into and determined. If the writ issues, it shall be made returnable at a time and place specified by court order and shall direct the commission to certify its record in the case to the court within the time specified.
The petition for review shall be served upon the executive director and the general counsel of the commission either personally or by service at the office of the commission.
For purposes of this section, the issuance of a decision or the granting of an application shall be construed to have occurred on the date of issuance, as defined in paragraph (4) of subdivision (b) of Section 1731.
The venue of a petition filed in the court of appeal pursuant to this section shall be in the judicial district in which the petitioner resides. If the petitioner is a business, venue shall be in the judicial district in which the petitioner has its principal place of business in California.
Any party may seek from the Supreme Court, pursuant to California Rules of Court, an order transferring related actions to a single appellate district.
For purposes of this section, review of decisions pertaining solely to water corporations shall only be by petition for writ of review in the Supreme Court, except that review of complaint or enforcement proceedings may be in the court of appeal or the Supreme Court.
No order or decision arising out of a commission proceeding under Section 854 shall be reviewable in the court of appeal pursuant to subdivision (a) if the application for commission authority to complete the merger or acquisition was filed on or before December 31, 1998, by two telecommunications-related corporations including at least one which provides local telecommunications service to over one million California customers. These orders or decisions shall be reviewed pursuant to the Public Utilities Code in existence on December 31, 1998.
In any proceeding reviewing an order or decision of the commission in the Supreme Court or court of appeal, the commission may appear and be heard as a party.
No new or additional evidence shall be introduced upon review by the court. In a complaint or enforcement proceeding, or in a ratemaking or licensing decision of specific application that is addressed to particular parties, the review by the court shall not extend further than to determine, on the basis of the entire record which shall be certified by the commission, whether any of the following occurred:
The commission acted without, or in excess of, its powers or jurisdiction.
The commission has not proceeded in the manner required by law.
The decision of the commission is not supported by the findings.
The findings in the decision of the commission are not supported by substantial evidence in light of the whole record.
The order or decision of the commission was procured by fraud or was an abuse of discretion.
The order or decision of the commission violates any right of the petitioner under the Constitution of the United States or the California Constitution.
Nothing in this section shall be construed to permit the court to hold a trial de novo, to take evidence other than as specified by the California Rules of Court, or to exercise its independent judgment on the evidence.
Notwithstanding subdivision (a), the standard of review in this section shall not apply to ratemaking or licensing decisions of specific application addressed solely to water corporations.
In any proceeding other than a proceeding subject to the standard of review under Section 1757, review by the court shall not extend further than to determine, on the basis of the entire record which shall be certified by the commission, whether any of the following occurred:
The order or decision of the commission was an abuse of discretion.
The commission has not proceeded in the manner required by law.
The commission acted without, or in excess of, its powers or jurisdiction.
The decision of the commission is not supported by the findings.
The order or decision was procured by fraud.
The order or decision of the commission violates any right of the petitioner under the Constitution of the United States or the California Constitution.
In reviewing decisions pertaining solely to water corporations, the review shall not be extended further than to determine whether the commission has regularly pursued its authority, including a determination whether the order or decision under review violates any right of the petitioner under the Constitution of the United States or this state.
No new or additional evidence shall be introduced upon review by the court. The findings and conclusions of the commission on findings of fact shall be final and shall not be subject to review except as provided in this article. The questions of fact shall include ultimate facts and findings and conclusions of the commission on reasonableness and discrimination.
The commission and each party to the action or proceeding before the commission may appear in the review proceeding.
Upon the hearing the Supreme Court or court of appeal shall enter judgment either affirming or setting aside the order or decision of the commission.
The provisions of the Code of Civil Procedure relating to writs of review shall, so far as applicable and not in conflict with this part, apply to proceedings instituted in the Supreme Court or court of appeal under this article.
Under this article, the Supreme Court may review decisions of the court of appeal in the manner provided for other civil actions.
The Supreme Court shall grant expedited consideration to any party or commission petition alleging that the court of appeal has assumed jurisdiction to review a commission decision pertaining solely to water corporations over which the court of appeal has no jurisdiction.
No court of this state, except the Supreme Court and the court of appeal, to the extent specified in this article, shall have jurisdiction to review, reverse, correct, or annul any order or decision of the commission or to suspend or delay the execution or operation thereof, or to enjoin, restrain, or interfere with the commission in the performance of its official duties, as provided by law and the rules of court.
The writ of mandamus shall lie from the Supreme Court and from the court of appeal to the commission in all proper cases as prescribed in Section 1085 of the Code of Civil Procedure.
Notwithstanding Sections 1757 and 1757.1, in any proceeding wherein the validity of any order or decision is challenged on the ground that it violates any right of petitioner under the United States Constitution or the California Constitution, the Supreme Court or court of appeal shall exercise independent judgment on the law and the facts, and the findings or conclusions of the commission material to the determination of the constitutional question shall not be final.
Any stay or suspension of an order or decision of the commission shall be granted only in accordance with this article and the rules of court.
A stay may be issued against any order or decision of the commission, other than an order or decision increasing or decreasing rates or changing a rate classification.
Except as provided in this section, no order staying or suspending an order or decision of the commission shall be made by the Supreme Court or court of appeal except upon five days’ notice and after hearing. If the order or decision of the commission is stayed or suspended, the order suspending it shall contain a specific finding, based upon evidence submitted to the court and identified by reference thereto.
The specific finding made pursuant to subdivision (a) shall certify that great or irreparable damage would otherwise result to the petitioner and specify the nature of the damage.
The Supreme Court or court of appeal may grant a temporary stay restraining the operation of the commission order or decision, other than an order or decision authorizing an increase or decrease in rates or changing a rate classification, at any time before the required hearing and determination of the application for a stay when, in the opinion of the court, irreparable loss or damage would result to petitioner unless the temporary stay is granted. The temporary stay shall remain in force only until the hearing determination of the application for a stay upon notice. The hearing of the application for a stay shall be given precedence and assigned for hearing at the earliest practicable day after the expiration of the notice.
No temporary stay shall be granted by the Supreme Court or court of appeal unless it clearly appears from specific facts shown by the verified petition that immediate and irreparable injury, loss, or damage will result to the applicant before notice can be served and hearing had on a motion for a stay as provided in this article.
Every temporary stay shall be endorsed with the date and hour of issuance, shall be forthwith filed in the clerk’s office and entered of record, shall define the injury and state why it appears to be irreparable and why the order was granted without notice, and shall by its terms expire within a time after entry not to exceed 10 days as the court may fix, unless within the time so fixed the order is extended for a like period for good cause shown and the reasons for the extension entered of record.
In case a temporary stay is granted without notice, the matter of the issuance of a stay shall be set down for hearing at the earliest possible time, and when it comes up for hearing the party obtaining the temporary stay shall proceed with the application for a stay. If the party does not so proceed, the court shall dissolve the temporary stay.
In case the order or decision of the commission is stayed or a temporary stay granted, the order of the Supreme Court or court of appeal shall not become effective until a suspending bond is executed and filed with and approved by the court, payable to the people of the State of California and sufficient in amount and security to insure the prompt payment by the party petitioning for the review, of all damages caused by the delay in the enforcement of the order or decision of the commission and of all money which any person or corporation may be compelled to pay pending the review of the proceedings for transportation, transmission, product, commodity, or service in excess of the charges fixed by the order or decision of the commission, in case the order or decision is sustained.
Under no circumstance shall the Supreme Court or court of appeal stay or suspend any order or decision by the commission authorizing an increase or decrease in rates or changing any rate classification.
If a commission order or decision authorizing any increase or decrease in rates, or changing any rate classification, is set aside by the Supreme Court or court of appeal, the matter shall be referred back to the commission for further action consistent with the order of the court. The commission, in taking this further action, shall not authorize refunds, and any relief ordered by the commission that shall have the effect of increasing or decreasing rates shall be prospective only.
All actions and proceedings under this part and all actions or proceedings to which the commission or the people of the State of California are parties in which any question arises under this part, or under or concerning any order or decision of the commission, shall be preferred over, and shall be heard and determined in preference to, all other civil business except election causes, irrespective of position on the calendar. The same preference shall be granted upon application of the attorney of the commission in any action or proceeding in which he is allowed to intervene.
The following procedures shall apply to judicial review of an order or decision of the commission interpreting, implementing, or applying the provisions of Chapter 4 of the Statutes of the 2001–02 First Extraordinary Session that (1) relates to the determination or implementation of the revenue requirements of the Department of Water Resources or the establishment or implementation of bond or power charges necessary to recover those revenue requirements, or (2) in the sole determination of the department, the expedited review of an order or decision of the commission is necessary or desirable, for the maintenance of any credit ratings on any bonds or notes of the department issued pursuant to Division 27 (commencing with Section 80000) of the Water Code or for the department to meet its obligations with respect to any bonds or notes pursuant to that division:
Within 30 days after the commission issues its order or decision denying the application for a rehearing, or, if the application is granted, then within 30 days after the commission issues its decision on rehearing, any aggrieved party may petition for a writ of review in the California Supreme Court for the purpose of determining the lawfulness of the original order or decision or of the order or decision on rehearing. If the writ issues, it shall be made returnable at a time and place specified by court order and shall direct the commission to certify its record in the case to the court within the time specified. No order of the commission interpreting, implementing, or applying the provisions of Chapter 4 of the Statutes of the 2001–02 First Extraordinary Session shall be subject to review in the courts of appeal.
The petition for review shall be served upon the executive director and the general counsel of the commission either personally or by service at the office of the commission.
For purposes of this section, the issuance of a decision or the granting of an application shall be construed to have occurred on the date of issuance, as defined in paragraph (4) of subdivision (b) of Section 1731.
All actions and proceedings under this section and all actions or proceedings to which the commission or the people of the State of California are parties in which any question arises under this section, or under or concerning any order or decision of the commission under this section, shall be preferred over, and shall be heard and determined in preference to, all other civil business except election causes, irrespective of position on the calendar.
The provisions of this article apply to actions under this section to the extent that those provisions are not in conflict with this section.
The following procedures shall apply to the judicial review of an order or decision of the commission in interpreting, implementing, or applying the provisions of Article 5.7 (commencing with Section 849) of Chapter 4 of Part 1 of Division 1:
Within 30 days after the commission issues its order or decision denying the application for a rehearing or, if the application is granted, within 30 days after the commission issues its decision on rehearing, an aggrieved party may petition for a writ of review in the California Supreme Court for the purpose of determining the lawfulness of the original order or decision or of the order or decision on the rehearing. If the writ is issued, it shall be made returnable at a time and place specified by court order and shall direct the commission to certify its record in the case to the court within the time specified. No order of the commission interpreting, implementing, or applying the provisions of Article 5.7 (commencing with Section 849) of Chapter 4 of Part 1 of Division 1 shall be subject to review in a court of appeals.
The petition for review shall be served upon the executive director of the commission either personally or by service at the office of the commission.
For purposes of this section, the issuance of a decision or the granting of an application shall be construed to have occurred on the date when the commission mails the decision or grant to the parties of the action or proceeding.
To the extent that the provisions do not conflict, provisions in this article shall apply to actions under this section.
ARTICLE 4. Witnesses [1791. - 1795.]
Each witness who appears by order of the commission or a commissioner shall receive for his attendance the same fees and mileage allowed by law to a witness in civil cases, which shall be paid by the party at whose request the witness is subpenaed. When any witness who has not been required to attend at the request of any party is subpenaed by the commission, his fees and mileage shall be paid from the funds appropriated for the use of the commission in the same manner as other expenses of the commission are paid. Any witness subpenaed except one whose fees and mileage may be paid from the funds of the commission, may, at the time of service, demand the fee to which he is entitled for travel to and from the place at which he is required to appear, and one day’s attendance. If such witness demands such fees at the time of service, and they are not at that time paid or tendered, he shall not be required to appear. All fees or mileage to which any witness is entitled under the provisions of this section may be collected by action therefor instituted by the person to whom such fees are payable. No witness furnished with free transportation shall receive mileage for the distance he may have traveled on such free transportation.
In case of the refusal of any witness to attend or testify or produce any papers required by a subpena issued by the commission or any commissioner, the commission or the commissioner may file, in the superior court in and for the county, or city and county, in which the proceedings is pending, a petition, setting forth that due notice has been given of the time and place of attendance of the witness, or the production of the papers, and that the witness has been summoned in the manner prescribed in this part and has failed and refused to attend or produce the papers required by the subpena, or has refused to answer questions propounded to him in the course of the proceeding. The petition shall include a request for an order of the court, compelling the witness to attend and testify or produce the papers before the commission.
Upon the filing of the petition the court shall enter an order directing the witness to appear before the court at a time and place fixed in the order and show cause why he has not attended and testified or produced said papers before the commission. The time fixed shall not be more than 10 days from the date of the order. A copy of the order shall be served upon the witness. If it appears to the court that the subpena was regularly issued by the commission or a commissioner, the court shall thereupon enter an order that the witness appear before the commission or commissioner at the time and place fixed in the order, and testify or produce the required papers, and upon failure to obey the order, the witness shall be dealt with as for contempt of court. The remedy provided in this section is cumulative, and shall not be construed to impair or interfere with the power of the commission or a commissioner to enforce the attendance of witnesses and the production of papers, and to punish for contempt in the same manner and to the same extent as courts of record.
The commission or any commissioner or any party may, in any investigation or hearing before the commission, cause the deposition of witnesses residing within or without the state to be taken in the manner prescribed by law for like depositions in civil actions in the superior courts of this state under Title 4 (commencing with Section 2016.010) of Part 4 of the Code of Civil Procedure and to that end may compel the attendance of witnesses and the production of books, waybills, documents, papers, and accounts.
No person shall be excused from testifying or from producing any book, waybill, document, paper, or account in any investigation or inquiry by or hearing before the commission or any commissioner, when ordered to do so, upon the ground that the testimony or evidence, book, waybill, document, paper, or account required of him may tend to incriminate him or subject him to penalty or forfeiture, but no person shall be prosecuted, punished, or subjected to any penalty or forfeiture for or on account of any act, transaction, matter or thing concerning which, under oath, he has testified or produced documentary evidence, but no person so testifying shall be exempt from prosecution or punishment for any perjury committed by him in his testimony. Nothing herein contained shall be construed as in any manner giving to any public utility immunity of any kind.
ARTICLE 5. Intervenor’s Fees and Expenses [1801. - 1812.]
The purpose of this article is to provide compensation for reasonable advocate’s fees, reasonable expert witness fees, and other reasonable costs to public utility customers of participation or intervention in any proceeding of the commission.
It is the intent of the Legislature that:
The provisions of this article shall apply to all formal proceedings of the commission involving electrical, gas, water, and telephone utilities.
The provisions of this article shall be administered in a manner that encourages the effective and efficient participation of all groups that have a stake in the public utility regulation process.
The process for finding eligibility for intervenor compensation be streamlined, by simplifying the preliminary showing by an intervenor of issues, budget, and costs.
Intervenors be compensated for making a substantial contribution to proceedings of the commission, as determined by the commission in its orders and decisions, regardless of whether a settlement agreement is reached.
Intervenor compensation be awarded to eligible intervenors in a timely manner, within a reasonable period after the intervenor has made the substantial contribution to a proceeding that is the basis for the compensation award.
This article shall be administered in a manner that avoids unproductive or unnecessary participation that duplicates the participation of similar interests otherwise adequately represented or participation that is not necessary for a fair determination of the proceeding.
As used in this article:
“Compensation” means payment for all or part, as determined by the commission, of reasonable advocate’s fees, reasonable expert witness fees, and other reasonable costs of preparation for and participation in a proceeding, and includes the fees and costs of obtaining an award under this article and of obtaining judicial review, if any.
“Customer” means any of the following:
A participant representing consumers, customers, or subscribers of any electrical, gas, telephone, telegraph, or water corporation that is subject to the jurisdiction of the commission.
A representative who has been authorized by a customer.
A representative of a group or organization authorized pursuant to its articles of incorporation or bylaws to represent the interests of residential customers, or to represent small commercial customers who receive bundled electric service from an electrical corporation.
“Customer” does not include any state, federal, or local government agency, any publicly owned public utility, or any entity that, in the commission’s opinion, was established or formed by a local government entity for the purpose of participating in a commission proceeding.
“Expert witness fees” means recorded or billed costs incurred by a customer for an expert witness.
“Eligible local government entity” means a city, county, or city and county that is not a publicly owned public utility that intervenes or participates in a commission proceeding for the purpose of protecting the health and safety of the residents within the entity’s jurisdiction following a catastrophic material loss suffered by its residents either in significant damage to infrastructure or loss of life and property, or both, as a direct result of public utility infrastructure.
“Other reasonable costs” means reasonable out-of-pocket expenses directly incurred by a customer that are directly related to the contentions or recommendations made by the customer that resulted in a substantial contribution.
“Party” means any interested party, respondent public utility, or commission staff in a hearing or proceeding.
“Proceeding” means an application, complaint, or investigation, rulemaking, alternative dispute resolution procedures in lieu of formal proceedings as may be sponsored or endorsed by the commission, or other formal proceeding before the commission.
“Significant financial hardship” means either that the customer cannot afford, without undue hardship, to pay the costs of effective participation, including advocate’s fees, expert witness fees, and other reasonable costs of participation, or that, in the case of a group or organization, the economic interest of the individual members of the group or organization is small in comparison to the costs of effective participation in the proceeding.
“Small commercial customer” means any nonresidential customer with a maximum peak demand of less than 50 kilowatts. The commission may establish rules to modify or change the definition of “small commercial customer,” including use of criteria other than a peak demand threshold, if the commission determines that the modification or change will promote participation in proceedings at the commission by organizations representing small businesses, without incorporating large commercial and industrial customers.
“Substantial contribution” means that, in the judgment of the commission, the customer’s presentation has substantially assisted the commission in the making of its order or decision because the order or decision has adopted in whole or in part one or more factual contentions, legal contentions, or specific policy or procedural recommendations presented by the customer. Where the customer’s participation has resulted in a substantial contribution, even if the decision adopts that customer’s contention or recommendations only in part, the commission may award the customer compensation for all reasonable advocate’s fees, reasonable expert fees, and other reasonable costs incurred by the customer in preparing or presenting that contention or recommendation.
A representative of a group representing the interests of small commercial customers who receive bundled electric service from an electrical corporation shall not be eligible for an award of compensation pursuant to this article if the representative has a conflict arising from prior representation before the commission. This conflict may not be waived.
An eligible local government entity is eligible for an award of compensation pursuant to this article for its involvement to the extent that the involvement was for the purpose of protecting health and safety within the entity’s jurisdiction and to the extent that the involvement was germane to the material loss suffered by its residents.
Participation by a customer that materially supplements, complements, or contributes to the presentation of another party, including the commission staff, may be fully eligible for compensation if the participation makes a substantial contribution to a commission order or decision, consistent with Section 1801.3.
The commission shall award reasonable advocate’s fees, reasonable expert witness fees, and other reasonable costs of preparation for and participation in a hearing or proceeding to any customer who complies with Section 1804 and satisfies both of the following requirements:
The customer’s presentation makes a substantial contribution to the adoption, in whole or in part, of the commission’s order or decision.
Participation or intervention without an award of fees or costs imposes a significant financial hardship.
The commission shall adopt a policy to allow reasonable advocate’s fees, reasonable expert witness fees, and other reasonable costs of preparation for and participation in a hearing or proceeding to an eligible local government entity that complies with Section 1804 and satisfies all of the following requirements:
The entity’s presentation makes a substantial contribution to the adoption, in whole or in part, of the commission’s order or decision.
Participation or intervention without an award of fees or costs imposes a significant financial hardship.
The subject of the hearing or proceeding is the result of a triggering event, as determined by the commission, that significantly impacted the residents of the local government entity.
A customer who, or eligible local government entity that, intends to seek an award under this article shall, within 30 days after the prehearing conference is held, file and serve on all parties to the proceeding a notice of intent to claim compensation. In cases where no prehearing conference is scheduled or where the commission anticipates that the proceeding will take less than 30 days, the commission may determine the procedure to be used in filing these requests. In cases where the schedule would not reasonably allow parties to identify issues within the timeframe set forth above, or where new issues emerge subsequent to the time set for filing, the commission may determine an appropriate procedure for accepting new or revised notices of intent.
The notice of intent to claim compensation shall include both of the following:
A statement of the nature and extent of the customer’s or eligible local government entity’s planned participation in the proceeding as far as it is possible to set it out when the notice of intent is filed.
An itemized estimate of the compensation that the customer or eligible local government entity expects to request, given the likely duration of the proceeding as it appears at the time.
The notice of intent may also include a showing by the customer or eligible local government entity that participation in the hearing or proceeding would pose a significant financial hardship. Alternatively, such a showing shall be included in the request submitted pursuant to subdivision (c).
Within 15 days after service of the notice of intent to claim compensation, the administrative law judge may direct the staff, and may permit any other interested party, to file a statement responding to the notice.
If the customer’s or eligible local government entity’s showing of significant financial hardship was included in the notice filed pursuant to subdivision (a), the administrative law judge, in consultation with the assigned commissioner, shall issue within 30 days thereafter a preliminary ruling addressing whether the customer or eligible local government entity will be eligible for an award of compensation. The ruling shall address whether a showing of significant financial hardship has been made. A finding of significant financial hardship shall create a rebuttable presumption of eligibility for compensation in other commission proceedings commencing within one year of the date of that finding.
The administrative law judge may, in any event, issue a ruling addressing issues raised by the notice of intent to claim compensation. The ruling may point out similar positions, areas of potential duplication in showings, unrealistic expectation for compensation, and any other matter that may affect the customer’s or eligible local government entity’s ultimate claim for compensation. Failure of the ruling to point out similar positions or potential duplication or any other potential impact on the ultimate claim for compensation shall not imply approval of any claim for compensation. A finding of significant financial hardship in no way ensures compensation. Similarly, the failure of the customer or eligible local government entity to identify a specific issue in the notice of intent or to precisely estimate potential compensation shall not preclude an award of reasonable compensation if a substantial contribution is made.
Following issuance of a final order or decision by the commission in the hearing or proceeding, a customer who, or eligible local government entity that, has been found, pursuant to subdivision (b), to be eligible for an award of compensation may file within 60 days a request for an award. The request shall include at a minimum a detailed description of services and expenditures and a description of the customer’s or eligible local government entity’s substantial contribution to the hearing or proceeding. Within 30 days after service of the request, the commission staff may file, and any other party may file, a response to the request.
The commission may audit the records and books of the customer or eligible local government entity to the extent necessary to verify the basis for the award. The commission shall preserve the confidentiality of the customer’s or eligible local government entity’s records in making its audit. Within 20 days after completion of the audit, if any, the commission shall direct that an audit report shall be prepared and filed. Any other party may file a response to the audit report within 20 days thereafter.
Within 75 days after the filing of a request for compensation pursuant to subdivision (c), or within 50 days after the filing of an audit report, whichever occurs later, the commission shall issue a decision that determines whether or not the customer or eligible local government entity has made a substantial contribution to the final order or decision in the hearing or proceeding. If the commission finds that the customer or eligible local government entity requesting compensation has made a substantial contribution, the commission shall describe this substantial contribution and shall determine the amount of compensation to be paid pursuant to Section 1806.
The computation of compensation awarded pursuant to Section 1804 shall take into consideration the market rates paid to persons of comparable training and experience who offer similar services. The compensation awarded may not, in any case, exceed the comparable market rate for services paid by the commission or the public utility, whichever is greater, to persons of comparable training and experience who are offering similar services.
An award made under this article shall be paid by the public utility that is the subject of the hearing, investigation, or proceeding, as determined by the commission, within 30 days. Notwithstanding any other law, an award paid by a public utility pursuant to this article shall be allowed by the commission as an expense for the purpose of establishing rates of the public utility by way of a dollar-for-dollar adjustment to rates imposed by the commission immediately on the determination of the amount of the award, so that the amount of the award shall be fully recovered within one year from the date of the award.
Due to the bankruptcy of Sacramento Natural Gas Storage, the commission’s intervenor compensation award to the Avondale Glen Elder Neighborhood Association in A.07-04-013 has been reduced to a fraction of the amount awarded. In this limited circumstance, the commission may pay to the Avondale Glen Elder Neighborhood Association the difference between the amount received from the bankruptcy court and the amount awarded by the commission by increasing the fees collected in Section 401 for the limited purpose of D.13-11-018.
The commission shall deny any award to any customer or eligible local government entity that attempts to delay or obstruct the orderly and timely fulfillment of the commission’s responsibilities.
A group or association that represents the interests of small agricultural customers in a proceeding and that would otherwise be eligible for an award of compensation pursuant to Section 1804 without the presence of large agricultural customers, as determined by the commission, shall not be deemed ineligible solely because that group or organization also has members who are large agricultural customers.
ARTICLE 6. Computer Models [1821. - 1822.]
As used in this article, the following definitions apply:
“Computer model” means a computer program.
“Operations model” means a computer model that replicates, lists, describes, or forecasts a public utility’s internal functions, including, but not limited to, its accounting procedures, cash management procedures, personnel assignments and procedures, and inventory control.
“Planning model” means a computer model that replicates, lists, describes, or forecasts a public utility’s complex functions, including, but not limited to, the forecasting of future loads and resources, calculating costs of electricity generation, producing financial statements, and calculating costs of natural gas production or supply.
“Public utility” includes every public utility and every business which is a commission regulated subsidiary or commission regulated affiliate of a public utility. “Public utility” does not include a common carrier or a telephone corporation whose service is determined to be competitive by the commission.
“Verify” means to assess the extent to which the computer model mimics reality.
Any computer model that is the basis for any testimony or exhibit in a hearing or proceeding before the commission shall be available to, and subject to verification by, the commission and parties to the hearing or proceedings to the extent necessary for cross-examination or rebuttal, subject to applicable rules of evidence, except that verification is not required for any electricity demand model or forecast prepared by the Energy Commission pursuant to Section 25309 or 25402.1 of the Public Resources Code and approved and adopted after a hearing during which testimony was offered subject to cross-examination. The commission shall afford each of these electricity demand models or forecasts the evidentiary weight it determines appropriate. Nothing in this subdivision requires the Energy Commission to approve or adopt any electricity demand model or forecast.
Any testimony presented in a hearing or proceeding before the commission that is based in whole, or in part, on a computer model shall include a listing of all the equations and assumptions built into the model.
Any database that is used for any testimony or exhibit in a hearing or proceeding before the commission shall be reasonably accessible to the commission staff and parties to the hearing or proceeding to the extent necessary for cross-examination or rebuttal, subject to applicable rules of evidence, as applied in commission proceedings.
The commission shall adopt rules and procedures to meet the requirements specified in subdivisions (a), (b), and (c). These rules shall include procedural safeguards that protect databases and models not owned by the public utility.
The commission shall establish appropriate procedures for determining the appropriate level of compensation for a party’s access.
Each party shall have access to the computer programs and models of each other party to the extent provided by Section 1822. The commission shall not require a utility to provide a remote terminal or other direct physical link to the computer systems of a utility to a third party.
The commission shall verify, validate, and review the computer models of any electrical corporation that are used for the purpose of planning, operating, constructing, or maintaining the corporation’s electrical transmission system, and that are the basis for testimony and exhibits in hearings and proceedings before the commission.
ARTICLE 7. Receiverships [1825. - 1826.]
If the commission determines in a proceeding that the appointment of a receiver is warranted pursuant to the processes or procedures adopted by the commission in its Decision 20-05-053, the commission may petition the superior court for the county within which PG&E Corporation has its principal office or place of business for the appointment of a receiver, as provided in paragraph (8) of subdivision (b) of Section 564 of the Code of Civil Procedure, to assume possession of Pacific Gas and Electric Company’s property and to operate its system.
For purposes of this section, both of the following definitions apply:
“Decision 20-05-053” means Decision 20-05-053 (May 28, 2019) Decision Approving Reorganization Plan in Investigation 19-09-016 (September 26, 2019) Order Instituting Investigation on the Commission’s Own Motion to Consider the Ratemaking and Other Implications of a Proposed Plan for Resolution of Voluntary Case filed by Pacific Gas and Electric Company Pursuant to Chapter 11 of the Bankruptcy Code, in the United States Bankruptcy Court, Northern District of California, San Francisco Division, In re Pacific Gas and Electric Corporation and Pacific Gas and Electric Company, Case No. 19-30088.
“Pacific Gas and Electric Company” means Pacific Gas and Electric Company, PG&E Corporation, any subsidiary or affiliate of the foregoing holding any assets related to the provision of electrical or gas service within Pacific Gas and Electric Company’s service territory, and any successor to any of the foregoing.
Whenever the commission determines, after notice and hearing, that any water or sewer system corporation is unable or unwilling to adequately serve its ratepayers, has been actually or effectively abandoned by its owners, or is unresponsive to the rules or orders of the commission, the commission may petition the superior court for the county within which the corporation has its principal office or place of business for the appointment of a receiver to assume possession of its property and to operate its system upon such terms and conditions as the court shall prescribe. The court may require, as a condition to the appointment of the receiver, that a sufficient bond be given by the receiver and conditioned upon compliance with the orders of the court and the commission, and the protection of all property rights involved. The court shall provide for disposition of the facilities and system in like manner as any other receivership proceeding in this state.
CHAPTER 10. Official Documents and Fees [1901. - 1905.]
Copies of all official documents and orders filed or deposited according to law in the office of the commission, certified by a commissioner or by the executive director or an assistant executive director under the official seal of the commission to be true copies of the originals, shall be evidence in like manner as the originals.
Every order, authorization, or certificate issued or approved by the commission under the following provisions of this part shall be in writing and entered on the records of the commission:
Sections 1001 to 1010, inclusive.
Sections 1201 to 1220, inclusive.
Any order, authorization, or certificate, or a copy thereof, or a copy of the record thereof, certified by a commissioner or by the executive director or the assistant executive director under the official seal of the commission to be a true copy of the original, may be recorded in the office of the recorder of any county, or city and county, in which is located the principal place of business of any public utility affected thereby, or in which is situated any property of any such public utility, and that record is public notice. A certificate under the seal of the commission that any order, authorization, or certificate has not been modified, stayed, suspended, or revoked may also be recorded in the same offices in the same manner and with like effect.
The commission shall fix the fees to be charged for the making and furnishing of copies, including certified copies, of papers, records, and documents of the commission. These charges shall as nearly as practicable reflect the costs of furnishing the materials and providing the service.
The commission shall also charge and collect the following fees:
Except as otherwise provided in Section 1036 for filing each application for a certificate of public convenience and necessity, or for the mortgage, lease, transfer, or assignment thereof, five hundred dollars ($500). The commission may adjust this fee based on the Consumer Price Index.
For a certificate authorizing an issue of bonds, notes, or other evidences of indebtedness, two dollars ($2) for each one thousand dollars ($1,000) of the face value of the authorized issue or fraction thereof up to one million dollars ($1,000,000), one dollar ($1) for each one thousand dollars ($1,000) over one million dollars ($1,000,000) and up to ten million dollars ($10,000,000), and fifty cents ($0.50) for each one thousand dollars ($1,000) over ten million dollars ($10,000,000), with a minimum fee in any case of fifty dollars ($50). No fee need be paid on such portion of any such issue as may be used to guarantee, take over, refund, discharge, or retire any stock, bond, note, or other evidence of indebtedness on which a fee has theretofore been paid to the commission. If the commission modified the amount of the issue requested in any case and the applicant thereupon elects not to avail itself of the commission’s authorization, no fee shall be paid, and if such fee is paid prior to the issuance of such certificate by the commission, such fee shall be returned.
The commission shall also charge and collect a fee for a certificate authorizing an issue of stock, which fee shall be computed at the rates set forth in subdivision (b) of Section 1904 and determined by the commission upon the basis of the proposed maximum proceeds. No fee shall be paid on such portion of any such issue as may be used to guarantee, take over, refund, discharge, or retire any stock, bond, note, or other evidence of indebtedness on which a fee has theretofore been paid to the commission.
If the commission modifies the amount of the issue requested in any case and the applicant thereupon elects not to avail itself of the commission’s authorization, no fee shall be paid, and if such fee is paid prior to the issuance of such certificate by the commission, such fee shall be refunded.
In every case in which an applicant’s security issues are subject to the jurisdiction of the Federal Energy Regulatory Commission pursuant to Section 204 of the Federal Power Act (49 Stat. 850, 16 U.S.C. 824c) or the applicant is an electrical or gas corporation whose security issues are subject to the jurisdiction of a public utilities regulatory agency of another state, no fees shall be charged and collected pursuant to subdivision (b) of Section 1904 and pursuant to Section 1904.1 for any face value of the bonds, notes, or other evidences of indebtedness, or the proposed maximum proceeds of stock, as the case may be, which exceeds the face value or maximum proceeds bearing the same proportion to the total face value or maximum proceeds as the gross operating revenues of the applicant derived from operations within the state bear to all of the applicant’s gross operating revenues.
As used in this section, “gross operating revenues” means such revenues as are shown on the accounts of the applicant as of the close of the calendar year immediately preceding the issuance by the commission of the certificate for which fees are charged and collected pursuant to subdivision (b) of Section 1904 or pursuant to Section 1904.1.
No fees shall be charged or collected for copies of papers, records, or official documents, furnished to public officers for use in their official capacity, or for the annual reports of the commission in the ordinary course of distribution, but the commission may fix reasonable charges for publications issued under its authority.
CHAPTER 11. Violations [2100. - 2120.]
Whenever the commission, after a hearing, finds that any common carrier, other than a railroad corporation, has charged, collected, or received a lesser compensation for the transportation of persons or property, or for any service in connection therewith, than the applicable rates, fares, and charges specified in its tariff schedules filed and in effect at the time, or that the carrier has refunded or remitted in any manner or by any device any portion of the rates, fares, or charges so specified without an order of the commission so authorizing, or charged, collected, or received a lesser compensation than that established by the commission under subdivision (b) of Section 493, the commission shall require the carrier to collect the undercharges involved and may impose upon the carrier a fine equal to the amount of the undercharges. These fines shall be deposited in the General Fund.
The remedy and penalty provided by this section shall be cumulative and shall not be a bar to or affect any other remedy or penalty provided for in this part, or to the exercise by the commission of its power to punish for contempt.
The commission shall see that the provisions of the Constitution and statutes of this State affecting public utilities, the enforcement of which is not specifically vested in some other officer or tribunal, are enforced and obeyed, and that violations thereof are promptly prosecuted and penalties due the State therefor recovered and collected, and to this end it may sue in the name of the people of the State of California. Upon the request of the commission, the Attorney General or the district attorney of the proper county or city and county shall aid in any investigation, hearing, or trial had under the provisions of this part, and shall institute and prosecute actions or proceedings for the enforcement of the provisions of the Constitution and statutes of this State affecting public utilities and for the punishment of all violations thereof.
Whenever the commission is of the opinion that any public utility is failing or omitting or about to fail or omit, to do anything required of it by law, or by any order, decision, rule, direction, or requirement of the commission, or is doing anything or about to do anything, or permitting anything or about to permit anything to be done, in violation of law or of any order, decision, rule, direction, or requirement of the commission, it shall direct the attorney of the commission to commence an action or proceeding in the superior court in and for the county, or city and county, in which the cause or some part thereof arose, or in which the corporation complained of has its principal place of business, or in which the person complained of resides, for the purpose of having such violations or threatened violations stopped and prevented, either by mandamus or injunction. The attorney of the commission shall thereupon begin such action or proceeding in the name of the people of the State of California, by petition to such superior court, alleging the violation or threatened violation complained of, and praying for appropriate relief by way of mandamus or injunction.
Upon the filing of a petition pursuant to Section 2102, the court shall specify a time, not exceeding 20 days after the service of the copy of the petition, within which the public utility complained of shall answer the petition, and in the meantime the public utility may be restrained. In case of default in answer, or after answer, the court shall immediately inquire into the facts and circumstances of the case. Such corporations or persons as the court deems necessary or proper to be joined as parties, in order to make its judgment, order or writ effective, may be joined as parties. The final judgment in any such action or proceeding shall either dismiss the action or proceeding or direct that the writ of mandamus or injunction issue or be made permanent as prayed for in the petition, or in such modified or other form as will afford appropriate relief. An appeal may be taken to the Supreme Court from such final judgment in the same manner and with the same effect, subject to the provisions of this part, as appeals are taken from judgments of the superior court in other actions for mandamus or injunction.
Except as provided by Sections 2100 and 2107.5, actions to recover penalties under this part shall be brought in the name of the people of the State of California, in the superior court in and for the county, or city and county, in which the cause or some part thereof arose, or in which the corporation complained of has its principal place of business, or in which the person complained of resides. The action shall be commenced and prosecuted to final judgment by the attorney or agent of the commission. All fines and penalties may be sued for and recovered. The commission may enjoin the sale of a public utility’s or common carrier’s assets to satisfy unpaid fines and penalties. The commission may use any of the remedies afforded to a creditor under the Uniform Voidable Transactions Act (Chapter 1 (commencing with Section 3439) of Title 2 of Part 2 of Division 4 of the Civil Code). Respondents who fraudulently transfer assets to avoid paying commission-imposed fines or penalties are subject to prosecution under Sections 154, 531, and 531a of the Penal Code. In all of these actions, the procedure and rules of evidence shall be the same as in ordinary civil actions, except for prosecutions under the Penal Code or as otherwise herein provided. All fines and penalties recovered by the state in any action, together with the costs thereof, shall be paid into the State Treasury to the credit of the General Fund. Any action may be compromised or discontinued on application of the commission upon the terms the court approves and orders.
This section shall become operative on January 1, 2014.
Any penalty for violation of any provision of this act, or of any rule, regulation, general order, or order of the commission, involving safety standards for pipeline facilities or the transportation of gas in the State of California may be compromised by the commission. In determining the amount of such penalty, or the amount agreed upon in compromise, the appropriateness of such penalty to the size of the business of the person charged, the gravity of the violation, and the good faith of the person charged in attempting to achieve compliance, after notification of a violation, shall be considered. The amount of any such penalty, when finally determined, or the amount agreed upon in compromise, may be recovered in a civil action in the name of the People of the State of California in the superior court in and for the county, or city and county in which the cause or some part thereof arose, or in which the corporation complained of has its principal place of business or the person complained of resides. In any such action, all penalties incurred, or amounts agreed upon in compromise for violations committed up to the time of commencing the action may be sued for and recovered. In all such actions, the procedure and rules of evidence shall be the same as in ordinary civil actions, except as otherwise herein provided. All fines and penalties recovered by the state in any such action, together with the costs thereof, shall be paid into the State Treasury to the credit of the General Fund.
Notwithstanding Section 2104, all moneys collected pursuant to any settlements, unless restricted by a court for another purpose, abatement orders, fines, or penalties by the commission from a gas corporation serving the Los Angeles Basin pursuant to an administrative enforcement or legal proceeding relating to the well failure at the Aliso Canyon natural gas storage facility first reported to the commission in October 2015 shall be deposited in the Aliso Canyon Recovery Account, which is hereby created in the State Treasury. Moneys in the account may be allocated, upon appropriation by the Legislature, for purposes of mitigating impacts on local air quality, public health, and ratepayers resulting from the well failure at Aliso Canyon, including evaluation of any negative effects on public health and enhancing the cost-effectiveness and feasibility of implementing Sections 380.6 and 2836.7.
For purposes of this section, “Los Angeles Basin” means the area identified as the “Aliso Canyon Delivery Area” on page 11 of the Aliso Canyon Risk Assessment Technical Report, dated April 5, 2016.
All penalties accruing under this part shall be cumulative, and a suit for the recovery of one penalty shall not be a bar to or affect the recovery of any other penalty or forfeiture or be a bar to any criminal prosecution against any public utility, or any officer, director, agent, or employee thereof, or any other corporation or person, or to the exercise by the commission of its power to punish for contempt.
Any public utility which does, causes to be done, or permits any act, matter, or thing prohibited or declared unlawful, or which omits to do any act, matter, or thing required to be done, either by the Constitution, any law of this State, or any order or decision of the commission, shall be liable to the persons or corporations affected thereby for all loss, damages, or injury caused thereby or resulting therefrom. If the court finds that the act or omission was wilful, it may, in addition to the actual damages, award exemplary damages. An action to recover for such loss, damage, or injury may be brought in any court of competent jurisdiction by any corporation or person.
No recovery as provided in this section shall in any manner affect a recovery by the State of the penalties provided in this part or the exercise by the commission of its power to punish for contempt.
Any public utility that violates or fails to comply with any provision of the Constitution of this state or of this part, or that fails or neglects to comply with any part or provision of any order, decision, decree, rule, direction, demand, or requirement of the commission, in a case in which a penalty has not otherwise been provided, is subject to a penalty of not less than five hundred dollars ($500), nor more than one hundred thousand dollars ($100,000), for each offense.
When the commission finds, after hearing, that any person or corporation has knowingly aided or abetted a common carrier in violating Section 458 or has violated Section 459, or any order, decision, rule, regulation, direction, demand, or requirement issued under those provisions, the commission may impose a fine for each violation not to exceed five thousand dollars ($5,000). In addition to the fine, the commission may impose interest on the fine, not to exceed the maximum rate of interest provided for in Section 1 of Article XV of the Constitution. Interest shall commence to accrue on the date when the payment of the fine becomes delinquent.
Every violation of the provisions of this part or of any part of any order, decision, decree, rule, direction, demand, or requirement of the commission, by any corporation or person is a separate and distinct offense, and in case of a continuing violation each day’s continuance thereof shall be a separate and distinct offense.
In construing and enforcing the provisions of this part relating to penalties, the act, omission, or failure of any officer, agent, or employee of any public utility, acting within the scope of his official duties or employment, shall in every case be the act, omission, or failure of such public utility.
Every public utility and every officer, agent, or employee of any public utility, who violates or fails to comply with, or who procures, aids, or abets any violation by any public utility of any provision of the California Constitution or of this part, or who fails to comply with any part of any order, decision, rule, direction, demand, or requirement of the commission, or who procures, aids, or abets any public utility in the violation or noncompliance in a case in which a penalty has not otherwise been provided, is guilty of a misdemeanor and is punishable by a fine not exceeding five thousand dollars ($5,000), or by imprisonment in a county jail not exceeding one year, or by both fine and imprisonment.
Every corporation or person, other than a public utility and its officers, agents, or employees, which or who knowingly violates or fails to comply with, or procures, aids or abets any violation of any provision of the California Constitution relating to public utilities or of this part, or fails to comply with any part of any order, decision, rule, direction, demand, or requirement of the commission, or who procures, aids, or abets any public utility in the violation or noncompliance, in a case in which a penalty has not otherwise been provided for the corporation or person, is subject to a penalty of not less than five hundred dollars ($500), nor more than fifty thousand dollars ($50,000) for each offense.
Every person who, either individually, or acting as an officer, agent, or employee of a corporation other than a public utility, violates any provision of this part, or fails to comply with any part of any order, decision, rule, direction, demand, or requirement of the commission, or who procures, aids, or abets any public utility in such violation or noncompliance, in a case in which a penalty has not otherwise been provided for such person, is guilty of a misdemeanor, and is punishable by a fine not exceeding one thousand dollars ($1,000), or by imprisonment in a county jail not exceeding one year, or by both such fine and imprisonment.
Notwithstanding any other provision of law, any person who willfully violates the provisions of Section 588 is guilty of a misdemeanor, subject to a penalty of not less than five hundred dollars ($500), nor more than two thousand dollars ($2,000), for each offense.
Every public utility, corporation, or person which fails to comply with any part of any order, decision, rule, regulation, direction, demand, or requirement of the commission or any commissioner is in contempt of the commission, and is punishable by the commission for contempt in the same manner and to the same extent as contempt is punished by courts of record. The remedy prescribed in this section does not bar or affect any other remedy prescribed in this part, but is cumulative and in addition thereto.
Any public utility on whose behalf any agent or officer thereof who, having taken an oath that he will testify, declare, depose or certify truly before the commission, willfully and contrary to such oath states or submits as true any material matter which he knows to be false, or who testifies, declares, deposes, or certifies under penalty of perjury and willfully states as true any material matter which he knows to be false, is guilty of a felony and shall be punished by a fine not to exceed five hundred thousand dollars ($500,000).
Whenever the commission determines that a railroad corporation has violated any order of the commission concerning the adequacy, condition, or safety of the corporation’s cars or tracks or any related fixture or appliance, the commission may impose upon the corporation a fine of not exceeding two thousand dollars ($2,000) for each violation or a fine of not exceeding two hundred dollars ($200) for each day that a violation continues uncorrected. The commission may assess interest upon any fine imposed, which shall commence upon the day the payment of the fine is delinquent.
Whenever a written notice to appear has been mailed to the owner of a passenger stage, an exact and legible duplicate copy of the notice, when filed with the magistrate in lieu of a verified complaint, is a complaint to which the defendant may plead guilty.
If, however, the defendant fails to appear, does not deposit bail, or pleads other than guilty to the offense charged, a complaint shall be filed which conforms to Chapter 2 (commencing with Section 948) of Title 5 of Part 2 of the Penal Code and which shall be deemed to be an original complaint, and thereafter the proceeding shall be held as provided by law, except that the defendant may, by an agreement in writing, subscribed by the defendant and filed with the court, waive the filing of a verified complaint and elect that the prosecution may proceed upon a written notice to appear.
Every passenger stage corporation and every officer, director, agent, or employee of a passenger stage corporation, who displays on any vehicle any identifying symbol other than one prescribed by the commission pursuant to Section 1038.5, or who fails to remove an identifying symbol when required by the commission, is guilty of a misdemeanor and is punishable by a fine of not more than one thousand dollars ($1,000), by imprisonment in the county jail for not more than one year, or by both.
The commission shall not distribute, expend, or encumber any moneys received by the commission as a result of any commission proceeding or judicial action, including the compromise or settlement of a claim, until both of the following are true:
The commission has provided the Director of Finance with written notification of the receipt of the moneys and the basis for those moneys being received by the commission.
The Director of Finance provides not less than 60 days’ written notice to the Chairperson of the Joint Legislative Budget Committee and the chairpersons of the appropriate budget subcommittees of the Senate and Assembly of the receipt of the moneys and the basis for those moneys being received by the commission.
This section does not apply to application or licensing fees charged by the commission to defray regulatory expenses.
This section does not apply to moneys received by the commission in a court-approved settlement or as a result of a court judgment where the court orders that the moneys be used for specified purposes.
This section does not apply to moneys received by the commission where statutes expressly provide how the moneys are to be paid or used, including all of the following:
Payment to any fund created by Chapter 1.5 (commencing with Section 270).
Payment to any account or fund pursuant to Chapter 2.5 (commencing with Section 401).
Payment to the Ratepayer Relief Fund pursuant to Article 9.5 (commencing with Section 16428.1) of Chapter 2 of Part 2 of Division 4 of Title 2 of the Government Code.
PART 2. SPECIFIC PUBLIC UTILITIES [2701. - 2899.]
CHAPTER 2. Water Companies [2701. - 2715.]
Any person, firm, or corporation, their lessees, trustees, receivers or trustees appointed by any court whatsoever, owning, controlling, operating, or managing any water system within this State, who sells, leases, rents, or delivers water to any person, firm, corporation, municipality, or any other political subdivision of the State, whether under contract or otherwise, is a public utility, and is subject to the provisions of Part 1 of Division 1 and to the jurisdiction, control, and regulation of the commission, except as otherwise provided in this chapter.
Any corporation or association which is organized for the purpose of delivering water solely to its stockholders or members at cost, and which delivers water to others than its stockholders or members, or to the state or any department or agency thereof or any school district, or to any other mutual water company, for compensation, is a public utility and is subject to Part 1 (commencing with Section 201) and to the jurisdiction, control, and regulation of the commission.
Any corporation or association which is organized both for the purpose of delivering water to its stockholders or members at cost, and to persons, firms, corporations, municipalities, or other political subdivisions of the state, is a public utility and is subject to Part 1 (commencing with Section 201) and to the jurisdiction, control, and regulation of the commission.
Any owner of a water supply not otherwise dedicated to public use and primarily used for domestic or industrial purposes by him or for the irrigation of his lands, who (a) sells or delivers the surplus of such water for domestic or school district purposes or for the irrigation of adjoining lands, or (b) in an emergency water shortage sells or delivers water from such supply to others for a limited period not to exceed one irrigation season, or (c) sells or delivers a portion of such water supply as a matter of accommodation to neighbors to whom no other supply of water for domestic or irrigation purposes is equally available, is not subject to the jurisdiction, control, and regulation of the commission.
Any corporation or association that is organized for the purposes of delivering water to its stockholders and members at cost, including use of works for conserving, treating, and reclaiming water, and that delivers water to no one except its stockholders or members, or to the state or any agency or department thereof, to any city, county, school district, or other public district, or any federal agency that provides fire protection or operates park facilities, or to any other mutual water company, at cost, is not a public utility, and is not subject to the jurisdiction, control or regulation of the commission. However, a mutual water company may perform the following acts without becoming a public utility and becoming subject to the jurisdiction, control or regulation of the commission:
May deliver water at cost to any lessee of its stock or shares or other evidence of membership where the lease is in writing signed by the owner of the stock or shares or other evidence of membership and the lessee thereof and approved by the mutual water company.
May deliver water at cost to any land leased by a stockholder, shareholder, or member of the mutual water company to a person not a stockholder, shareholder or member thereof, provided the lease is in writing signed by the stockholder, shareholder or member and the lessee of the land and approved by the mutual water company.
May transfer water or water rights to, or exchange water or water rights with, another entity pursuant to state or federal law, or both.
In a bona fide water emergency, but for no longer than the existence of the emergency, may deliver water at cost to any person owning or leasing real property located within or adjacent to the service area of the mutual water company, provided that the water is delivered pursuant to a written contract signed by the mutual water company and the person to whom the water is delivered.
May deliver water pursuant to any contract for water service made:
In settlement of litigation involving disputed water rights or any judgment in the litigation.
In consideration of the conveyance of a well, water right, or easement for water distribution purposes.
All of these leases and contracts shall be preserved for a period of 10 years by a mutual water company and shall be subject to inspection by the commission.
The term “cost” as used in this section shall be construed to mean without profit.
Any person or corporation, and their lessees, receivers, or trustees appointed by any court, that maintains a mobilehome park or a multiple unit residential complex and provides, or will provide, water service to users through a submeter service system is not a public utility and is not subject to the jurisdiction, control, or regulation of the commission if each user of the submeter service system is charged at the rate which would be applicable if the user were receiving the water directly from the water corporation, or if management of the mobilehome park complies with subdivision (c) of Section 798.40 of the Civil Code.
A mobilehome park that provides water service only to its tenants from water supplies and facilities that it owns, not otherwise dedicated to public service, is not a water corporation. However, if a complaint is filed with the commission by tenants of the mobilehome park that represent 10 percent or more of the park’s water service connections during any 12-month period, claiming that the water rates charged by the park are not just and reasonable or that the service is inadequate, the commission shall have jurisdiction to determine the merits of the complaint and shall determine, based on all the facts and circumstances, whether the rates charged are just and reasonable and whether the service provided is adequate.
The numerical threshold of persons may include former or current tenants, or both.
A person shall not file a complaint against a mobilehome park pursuant to paragraph (1) if that person has not resided in that mobilehome park within the last five years.
Complaints filed pursuant to subdivision (a) are subject to this code and to the Rules of Practice and Procedure of the commission governing complaints and commission investigations.
A mobilehome park, as described in subdivision (a), shall provide written notice to each of the mobilehome park’s tenants to inform those tenants of their right to, and how to, file a complaint with the commission about the water rates charged or the service provided by the mobilehome park. With respect to the notice, the mobilehome park shall do all of the following:
Provide the notice to new tenants at the time the tenants establish residence within the mobilehome park.
Provide the notice to tenants each time the mobilehome park changes water rates or service.
Notwithstanding any other law, the notice provided by a mobilehome park pursuant to paragraph (1) shall be written in English, the languages set forth in subdivision (b) of Section 1632 of the Civil Code, and the language or languages of primary communication with the residents receiving the notice.
The commission shall prepare and make available on its Internet Web site an approved notice in English and the languages set forth in subdivision (b) of Section 1632 of the Civil Code. In providing notice pursuant to paragraph (1), a mobilehome park shall use the then-current language made available by the commission pursuant to this subparagraph.
A mobilehome park that fails to provide the notice required by this subdivision shall be subject to the penalties established in Section 2111.
The commission may afford rate relief or may order the mobilehome park to improve its water supply, facilities, and services on those terms that it finds just and reasonable, or both.
If the commission finds, after investigation, that the mobilehome park has charged an unjust or unreasonable rate in violation of this section subsequent to December 31, 2012, the commission shall order the mobilehome park to reimburse the complainants and any other current and former tenants affected by the rate, if no discrimination will result from the reimbursement. Reimbursement shall be calculated from the first date of collection of the unjust or unreasonable rate, with interest. The commission shall not make an order for the payment of reimbursement upon the ground of unjustness or unreasonableness if the rate in question has been previously declared by formal finding of the commission to be reasonable. The commission shall not recognize the assignment of a reimbursement claim except assignments by operation of law as in cases of death, insanity, bankruptcy, receivership, or order of court.
The public advisor created pursuant to Section 321 and necessary staff of the commission shall assist the complainants.
Any person, firm, or corporation, their lessees, trustees, receivers or trustees appointed by any court, who sells or delivers water exclusively to a water conservation district organized under the laws of the state or who leases or otherwise permits the use of ditches or other water transmission facilities exclusively by the district is not a public utility within the meaning of this chapter. No portion of the works, property, or water rights of any of those parties shall be deemed dedicated to a public use by reason of selling or delivering water to a water conservation district.
Any person, firm, or corporation with water that is not being used to supply water to a public water system, or that is not otherwise dedicated to public use, that sells, leases, transfers, or otherwise delivers the water at wholesale to any public agency or to a water corporation providing water utility service, is not a public utility within the meaning of this chapter.
This section does not apply to mutual water companies.
For the purpose of determining the status of any person, firm, or corporation, their lessees, trustees, receivers or trustees appointed by any court, owning, controlling, operating, or managing any water system or water supply within this state, the commission may hold hearings and issue process and orders in the manner and to the same extent as provided in Part 1 (commencing with Section 201), and the findings and conclusions of the commission on questions of fact arising under this chapter are final and not subject to review, except as provided in Part 1 (commencing with Section 201).
Whenever the commission, after a hearing had upon its own motion or upon complaint, finds that any water company which is a public utility operating within this State has reached the limit of its capacity to supply water and that no further consumers of water can be supplied from the system of such utility without injuriously withdrawing the supply wholly or in part from those who have theretofore been supplied by the corporation, the commission may order and require that no such corporation shall furnish water to any new or additional consumers until the order is vacated or modified by the commission. The commission, after hearing upon its own motion or upon complaint, may also require any such water company to allow additional consumers to be served when it appears that service to additional consumers will not injuriously withdraw the supply wholly or in part from those who theretofore had been supplied by such public utility.
The commission may require any water corporation to file with the commission a statement in writing defining and describing the lands and territory to be supplied by the corporation with water.
When it appears from (a) the statement required by Section 2709, (b) the articles of incorporation of any water corporation, or (c) any notice of appropriation of water required by law, that a water corporation has undertaken to supply more consumers or a greater number of acres than it can adequately supply, the commission may require the corporation to limit the number of consumers or acres of land which it has undertaken to supply or which is set out in its articles of incorporation or notices of appropriation to such a limited number of consumers or acres of land as the commission finds, after hearing, that the water corporation may adequately supply.
Section 2710 does not apply to territory or consumers which have once been served by the corporation. As between consumers who have been voluntarily admitted to participate by the corporation in its supply of water or required to be supplied by an order of the commission, in times of water shortage the corporation shall give no priority or preference but shall apportion its supply ratably among its consumers.
“Whether under contract or otherwise” as used in Section 2701 is not to be construed as authorizing a contract by a person or corporation defined in this chapter as a public utility which in anywise deprives the State or the commission or other competent authority of power to regulate the rates and service of any such public utility.
No water corporation subject to the jurisdiction and control of the commission and the provisions of Part 1 (commencing with Section 201) of this division shall make any charge upon any entity providing fire protection service to others for furnishing water for such fire protection purposes or for any costs of operation, installation, capital, maintenance, repair, alteration, or replacement of facilities related to furnishing water for such fire protection purposes within the service area of such water corporation, except pursuant to a written agreement with such entity providing fire protection services. A water corporation shall furnish water for fire protection purposes to the extent of its means and as a condition of a certificate of public convenience and necessity, in case of fire or other great necessity, within the boundaries of the territory served by it for use within such territory.
The provisions of subdivision (a) shall not restrict or limit a water corporation furnishing water for fire protection purposes from levying charges for water service or facilities, including water for fire protection purposes, on any person, property, or entity, whether public or private, other than on an entity providing fire protection service.
Such charges shall be collected from such other persons, property, or entities pursuant to existing provisions of law which authorize such charges, or from an entity providing fire protection services only pursuant to a written agreement authorizing such charges.
For the purposes of this section, “entity providing fire protection service” means a city, county, city and county, whether general law or chartered, and a fire company, fire protection district, or any other person, association, company, corporation, special district, municipal corporation, or any other public or private entity, which public or private entity or person provides fire protection services to any other public or private entity or person.
No water corporation furnishing water for residential use to a tenant shall seek to recover any charges or penalties for the furnishing of water to or for the tenant’s residential use from any subsequent tenant on account of nonpayment of charges by a previous tenant. The water corporation may, however, require that service to subsequent tenants be furnished on the account of the landlord or property owner.
A water corporation with more than 10,000 service connections shall maintain on its Internet Web site an archive of all pending, approved, or rejected advice letters for a period of two rate case cycles from the date the advice letter is submitted or for six years, whichever is shorter, and shall do all of the following:
Provide a direct link from its Internet Web site to each advice letter, making the information contained there available to the public.
Maintain advice letters in numerical order. The advice letters may be retained as a stand-alone site. The water corporation may combine the list with a list of current advice letters that have been transmitted for filing, or are filed, pending, protested, or otherwise active.
Include a link to the commission’s index of advice letters on the water corporation’s Internet Web site.
For the purposes of this section, “advice letter” means an advice letter pending, approved, or rejected on or after January 1, 2019, and includes its concurrently submitted cover sheets, attachments, service lists, and exhibits, to the extent they are not identified as confidential.
CHAPTER 2.5. Public Water System Investment and Consolidation Act of 1997 [2718. - 2720.]
This chapter shall be known and may be cited as the Public Water System Investment and Consolidation Act of 1997.
The Legislature finds and declares all of the following:
Public water systems are faced with the need to replace or upgrade the public water system infrastructure to meet increasingly stringent state and federal safe drinking water laws and regulations governing fire flow standards for public fire protection.
Increasing amounts of capital are required to finance the necessary investment in public water system infrastructure.
Scale economies are achievable in the operation of public water systems.
Providing water corporations with an incentive to achieve these scale economies will provide benefits to ratepayers.
The commission shall use the standard of fair market value when establishing the rate base value for the distribution system of a public water system acquired by a water corporation. This standard shall be used for ratesetting.
For purposes of this section, “public water system” shall have the same meaning as set forth in Section 116275 of the Health and Safety Code.
For purposes of this section, “fair market value” shall have the same meaning as set forth in Section 1263.320 of the Code of Civil Procedure.
If the fair market value exceeds reproduction cost, as determined in accordance with Section 820 of the Evidence Code, the commission may include the difference in the rate base for ratesetting purposes if it finds that the additional amounts are fair and reasonable. In determining whether the additional amounts are fair and reasonable the commission shall consider whether the acquisition of the public water system will improve water system reliability, whether the ability of the water system to comply with health and safety regulations is improved, whether the water corporation by acquiring the public water system can achieve efficiencies and economies of scale that would not otherwise be available, and whether the effect on existing customers of the water corporation and the acquired public water system is fair and reasonable.
The provisions of subdivisions (a) and (b) shall also be applicable to the acquisition of a sewer system by any sewer system corporation or water corporation.
CHAPTER 2.7. Consolidation for Safe Drinking Water Act of 2021 [2721. - 2722.]
For purposes of this section, the following terms have the following meanings:
“Consolidate” means to join two or more small community water systems, state small water systems, or affected residences not served by a small community water system or state small water system into a single consolidated water system.
“Small community water system” has the same meaning as set forth in Section 116275 of the Health and Safety Code.
“State small water system” has the same meaning as set forth in Section 116275 of the Health and Safety Code.
A water or sewer system corporation may file an application and obtain approval from the commission through an order authorizing that water or sewer system corporation to consolidate with a small community water system or state small water system identified as failing or at risk of failing by the State Water Resources Control Board.
The commission shall approve or deny an application filed pursuant to paragraph (1) within 12 months of its filing, unless the commission makes a written determination that the deadline cannot be met, including findings as to the reason, and issues an order extending the deadline by up to four months. The commission may grant additional extensions of four months or less consistent with this paragraph.
A water or sewer system corporation shall submit a fee of ten thousand dollars ($10,000) when filing an application for authority to complete a consolidation made pursuant to paragraph (1).
All moneys collected pursuant to paragraph (3) shall be deposited into the Consolidation For Safe Drinking Water Fund, established pursuant to Section 2722.
For a consolidation valued at five million dollars ($5,000,000) or less, a water or sewer system corporation may file an advice letter and obtain approval from the commission through a resolution authorizing that water or sewer system corporation to consolidate with a small community water system or state small water system identified as failing or at risk of failing by the State Water Resources Control Board.
If an advice letter filed pursuant to this paragraph is uncontested, approval may be given by the executive director or the director of the division of the commission having regulatory jurisdiction over the water or sewer system corporation.
Absent incomplete documentation, the commission shall approve or deny the advice letter within 180 days of its filing by the applicant water or sewer system corporation, if the advice letter is not contested, unless the executive director makes a written determination that the deadline cannot be met, including findings as to the reason, and issues a response extending the deadline by up to 60 days. The executive director may grant additional extensions of 60 days or less consistent with this subparagraph.
For purposes of a consolidation pursuant to either subdivision (b) or (c), the commission shall prioritize cases in which a water or sewer system corporation consolidates with a small community water system or state small water system that is subject to a citation issued pursuant to Section 116650 of the Health and Safety Code or a compliance order issued pursuant to Section 116655 of the Health and Safety Code for failure to meet primary or secondary drinking water standards, as defined in Section 116275 of the Health and Safety Code.
A water or sewer system corporation seeking to consolidate with a small community water system or state small water system pursuant to this section shall give adequate public notice and provide adequate opportunities for public participation, as determined by the commission.
This section does not require a small community water system or state small water system that is not subject to the jurisdiction, control, and regulation of the commission to obtain authorization from the commission before consolidating with a small community water system or state small water system.
The Consolidation For Safe Drinking Water Fund is hereby created. All moneys in the fund are available, upon appropriation by the Legislature, to the commission and shall be used only for the purpose of processing applications pursuant to subdivision (b) of Section 2721 along with any other associated regulatory costs.
CHAPTER 3. Private and Mutual Water Service Law [2725. - 2729.]
As used in this chapter, “mutual water company” means any private corporation or association organized for the purposes of delivering water to its stockholders and members at cost, including use of works for conserving, treating and reclaiming water.
In order to increase the output of agricultural products in this State during the time the United States is a party to war or to a state of war, the owner of any private irrigation plant may deliver water to others, or any mutual water company may deliver water to others than its stockholders or members, with or without compensation, without becoming a public utility subject to the jurisdiction of the commission.
The delivery of water pursuant to Section 2727 is subject to the following restrictions:
Until a mutual water company fills the water orders of its stockholders or members pursuant to its constitution, bylaws, or rules, it shall not deliver water to others.
The temporary service authorized by Section 2727 shall not continue for more than six months after the war need has ceased.
Before any temporary service of water is made a statement shall be filed with the commission stating the private irrigation plant or mutual water company rendering the service, the party receiving it, the land irrigated, and the rate, if any, charged for the service.
A mutual water company may exercise the power of eminent domain for water, water rights, canals, ditches, dams, poundings, flumes, aqueducts, and pipes for irrigation of lands furnished with water by such company.
CHAPTER 4.5. Electrical and Gas Corporations [2771. - 2775.7.]
The commission shall establish priorities among the types or categories of customers of every electrical corporation and every gas corporation, and among the uses of electricity or gas by such customers. The commission shall determine which of such customers and uses provide the most important public benefits and serve the greatest public need and shall categorize all other customers and uses in order of descending priority based upon these standards. The commission shall establish no such priority after the effective date of this chapter which would cause any reduction in the transmission of gas to California pursuant to any federal rule, order, or regulation.
In establishing the priorities pursuant to Section 2771, the commission shall include, but not be limited to, a consideration of all the following:
A determination of the customers and uses of electricity and gas, in descending order of priority, that provide the most important public benefits and serve the greatest public need.
A determination of the customers and uses of electricity and gas that are not included under subdivision (a).
A determination of the economic, social, and other effects of a temporary discontinuance in electrical or gas service to the customers or for the uses determined in accordance with subdivision (a) or (b).
A determination of the potential effect of extreme temperatures on the health and safety of residential customers. In making this determination, the commission shall do all of the following:
Consult with appropriate medical experts and review appropriate literature and research.
Consider whether providing priority to customers experiencing extreme temperatures would result in increased outage frequency and duration for remaining customers and its effect on the health and safety of those remaining customers.
To the extent the commission determines it is in the public interest to provide priority to customers that experience extreme temperatures, it shall provide that priority only when temperatures are extreme.
Consider whether alternative measures are appropriate, including, but not limited to, reducing the duration of the outage or imposing the outage earlier or later in the day.
A determination of unacceptable jeopardy or imminent danger to public health and safety that creates substantial likelihood of severe health risk requiring medical attention.
Any curtailment or allocation rules, orders, or regulations issued by any agency of the federal government.
The commission shall also consider the effect of providing a high priority to some customers on those customers who do not receive a high priority.
The commission may establish as many priorities of use for a customer as that customer has uses of gas or electricity.
Notwithstanding any rule, order, or decision of the commission to the contrary, industrial or commercial gas customers shall not be required to maintain any alternative fuel capability with respect to equipment which uses gas to generate steam for enhanced crude oil recovery or which uses gas for purposes of cogeneration. Nothing in this section shall require the commission to assign these industrial customers any higher gas priority as a result of the elimination of this alternative fuel requirement.
In the event any electrical or gas corporation experiences any shortage of capacity or capability in the generation, production, or transmission of electricity or gas and is unable to obtain electricity or gas from any other source so that the corporation is unable to meet all demands by its customers, the commission shall, to the extent practicable, order that service be temporarily reduced by an amount that reflects the priorities established pursuant to this chapter, for the duration of the shortage. The commission may, to the extent permitted by federal law or regulation, require electrical or gas corporations to mutually assist each other in dealing with shortages resulting from inadequate fuel supplies, and shall determine the terms, including compensation, under which such assistance shall be provided.
The commission shall require an electrical corporation to include in an annual reliability report, required pursuant to Decision 96-09-045, as amended, or a decision that supersedes Decision 96-09-045, information on the reliability of service to end use customers that identifies, but is not limited to, the frequency and duration of interruptions in services. This information shall indicate areas with both the most frequent and longest outages, using local areas determined by the commission. The commission, in consultation with the electrical corporation, shall ensure that the geographical boundaries of local areas do not split up circuits for reporting purposes, if the electrical corporation aggregates data by circuits. The information shall be sufficiently aggregated to both maintain electrical system security, and be of use and relevance to affected customers of the electrical corporation.
Before July 1, 2014, the commission shall determine the local areas for the purposes of paragraph (1).
The requirements of paragraph (1) shall apply to annual reports due after July 1, 2014.
The electrical corporation shall conspicuously post on its Internet Web site the annual report required pursuant to Decision 96-09-045, as amended, or a decision that supersedes Decision 96-09-045.
The commission shall use the information contained in an electrical corporation’s annual reliability report to require cost-effective remediation of reliability deficiencies if the report, or more than one report, identifies repeated deficiencies in the same local area as determined by the commission pursuant to paragraph (1) of subdivision (a). In requiring cost-effective remediation, the commission shall consult with the electrical corporation and consider mitigating factors that may impede an electrical corporation from implementing required cost-effective remediation, including, but not limited to, local permitting matters or other events or conditions or public policy considerations that may present higher priority safety or reliability issues.
The commission may suspend the requirements of paragraph (1) if the commission finds that expenditures by the electrical corporation to comply with that paragraph are not justified or that the remediation measures undertaken by the electrical corporation are not effective at improving reliability.
The commission may make those analyses publicly available.
An electrical corporation or local publicly owned electric utility shall immediately notify the Commissioner of the California Highway Patrol, the Office of Emergency Services, and the sheriff and any affected chief of police of the specific area within their respective law enforcement jurisdictions that will sustain a planned loss of power as soon as the planned loss becomes known as to when and where that power loss will occur. The notification shall include common geographical boundaries, grid or block numbers of the affected area, and the next anticipated power loss area designated by the electrical corporation or public entity during rotating blackouts.
The commission, in consultation with the Energy Commission, shall develop a program for residential and commercial customer air-conditioning load control, as an element of each electrical corporation’s tariffed service offerings paid for with electrical service rates. The goal of the program shall be to contribute to the adequacy of electricity supply and to help customers reduce their electrical service bills in a cost-effective manner. The program may include peak load reduction programs for residential and commercial air-conditioning systems, if the commission determines that the inclusion would be cost effective.
No electrical or gas corporation which reduces or discontinues service in accordance with any order of the commission issued pursuant to this chapter shall be liable for any damages to any person or property resulting from such reduction or discontinuance.
If an electrical or gas corporation desires to manufacture, lease, sell, or otherwise own or control any solar energy system, it shall submit to the commission, in such form as the commission may specify, a description of the proposed program of solar energy development which it desires to pursue. The corporation may pursue the program of solar energy development unless the commission, within 45 days after the commission has accepted the filing of the corporation’s description pursuant to this subdivision, orders the corporation to obtain from the commission the authorization to do so as provided in this section. In cases where the corporation seeks to pursue a program of solar energy development with costs and expenses to be passed through to the ratepayers, the corporation may not implement the program until it receives an authorization from the commission which includes findings and a determination, pursuant to subdivision (f), that the program is in the ratepayers’ interest. No such authorization shall be required for any solar energy system which is owned or controlled for experimental or demonstration purposes. As used in this subdivision, “experimental or demonstration purposes” means a limited program of installation, use, or development the sole purpose of which is to investigate the technical viability or economic cost effectiveness of a solar application.
The commission shall deny the authorization sought if it finds that the proposed program will restrict competition or restrict growth in the solar energy industry or unfairly employ in a manner which would restrict competition in the market for solar energy systems any financial, marketing, distributing, or generating advantage which the corporation may exercise as a result of its authority to operate as a public utility. Before granting any such authorization, the commission shall find that the program of solar energy development proposed by the corporation will accelerate the development and use of solar energy systems in this state for the duration of the program.
The commission shall suspend or terminate any authorization granted pursuant to this section whenever it finds and determines that the program of solar energy development no longer qualifies for the authorization under subdivision (b). This subdivision applies to all programs of solar energy development undertaken by a gas or electrical corporation pursuant to this section, including programs undertaken pursuant to subdivision (a) without formal authorization of the commission.
As used in this section, “solar energy system” means equipment which uses solar energy to heat or cool or produce electricity and which has a useful life of at least three years. “Solar energy system” does not include an electric plant as defined by Section 217.
The commission shall prescribe the form of the description required by subdivision (a) by July 1, 1990. The description of the solar energy program filed with the commission shall include, but not be limited to, a showing that the program will not restrict competition, or restrict growth in the solar energy industry, or unfairly employ any financial, marketing, distributing, or generation advantage by the corporation on behalf of the solar energy program.
The costs and expenses of implementing a program of solar energy development proposed pursuant to this section shall not be passed through to the ratepayers of an electrical or gas corporation unless the commission finds and determines that it is in the ratepayers’ interest to do so.
An electrical or gas corporation shall file a written notice with the commission in all cases where one of its subsidiaries seeks to implement a solar energy development program. If an affiliate of an electrical or gas corporation seeks to implement a solar energy development program, the electrical or gas corporation shall notify the commission of its affiliate’s actions annually, in a form prescribed by the commission. If the electrical or gas corporation intends to provide financial, marketing, or distribution assistance to any subsidiary or affiliate thereof in implementing the subsidiary’s or affiliate’s program of solar energy development, the electrical or gas corporation shall obtain authorization from the commission to provide that assistance. Authorization by the commission shall be given in the manner provided in subdivisions (a) and (b), and suspension or termination by the commission may be imposed in the manner provided in subdivision (c).
The commission shall provide public notice of the receipt of any corporation filings submitted pursuant to this section.
Every request for the recovery in rates of any costs or liability incurred by a gas corporation and resulting from any violation of Section 25421 of the Health and Safety Code, or of any costs, damages, penalties, or other liabilities incurred in connection with the sale of landfill gas containing chemicals known to the state to cause cancer or reproductive toxicity shall be reviewed by the commission for the purposes of establishing rates for the gas corporation. If the commission finds that the gas corporation, on or after January 1, 1989, knowingly and intentionally violated Section 25421 of the Health and Safety Code, the costs and liability shall be disallowed by the commission for purposes of determining rates.
If the commission determines that a moratorium on new natural gas service connections is necessary to prevent substantial and imminent harm or to ensure gas system reliability, the commission shall state the necessity for the action in a report provided to all of the following entities:
The Assembly Committee on Utilities and Energy.
The Senate Committee on Energy, Utilities and Communications.
All affected gas corporations.
The commission shall include in the report to the policy committees of the Legislature specified in paragraph (1) factual findings supporting the need to propose a moratorium on new natural gas service connections. The report shall include, but is not limited to, all of the following:
The number of pending gas service connection applications with each affected gas corporation.
The estimated gas load deferred under the proposed moratorium.
The system constraints that led to the proposed moratorium.
Alternative actions considered to address the proposed need for a moratorium, including increasing or restoring natural gas transmission and storage infrastructure, and the reason those actions were not taken or were insufficient.
The process for a customer to request an exemption from the moratorium.
When a gas corporation receives notification from the commission that an action is pending to suspend new gas service connections, the gas corporation shall immediately notify any known potential or current customers that may experience a service impact as a result of the proposed suspension.
The commission shall, at the yearly informational hearings pursuant to Section 321.6, present to the Assembly Committee on Utilities and Energy and the Senate Committee on Energy, Utilities and Communications the status of natural gas service connections and efforts to provide natural gas supply.
CHAPTER 5. Electrical Cooperatives [2776. - 2778.]
As used in this chapter, the term “electrical cooperative” means any private corporation or association organized for the purposes of transmitting or distributing electricity exclusively to its stockholders or members at cost.
The commission shall have no authority to establish rates or regulate the borrowing of money, the issuance of evidences of indebtedness, or the sale, lease, assignment, mortgage, or other disposal or encumbrance of the property of any electrical cooperative.
Except as otherwise specified in this chapter, every electrical cooperative is subject to Part 1 (commencing with Section 201).
CHAPTER 5.5. Electric Microutilities [2780. - 2780.1.]
As used in this chapter, the term “electric microutility” means any electrical corporation that is regulated by the commission and organized for the purpose of providing sole-source generation, distribution, and sale of electricity exclusively to a customer base of fewer than 2,000 customers.
It is the intent of the Legislature that the commission consider the legal, administrative, and operational costs that an electric microutility faces if it is named as a respondent in a hearing generally applicable to electrical corporations. The limited resources of a microutility are disproportionately strained by the cost of response.
Further, it is the intent of the Legislature that the commission consider the costs described in subdivision (a) before naming an electric microutility as a respondent in a hearing generally applicable to electrical corporations.
CHAPTER 6. Home Insulation Assistance and Financing [2781. - 2790.]
The commission shall permit any electrical or gas corporation to institute a home insulation assistance and financing program for its residential customers in accordance with the provisions of this chapter. The commission shall develop and adopt, by regulation or order, such requirements as it finds are necessary or desirable to implement the provisions of this chapter.
A customer of a participating electrical or gas corporation who is the owner or mortgagor of real property or tenant of such property with a written consent of the owner may apply to the corporation for home insulation assistance and financing. To qualify for financing, such customer must meet the credit criteria as may reasonably be established by the corporation as approved by the commission.
Upon approval of an application, the corporation shall arrange for a licensed contractor to perform the necessary work. Upon approval of an estimate by the customer and the corporation, the corporation shall direct the work to commence. All attic insulation installations shall meet or exceed requirements applicable at the time of installation or as may be established for existing residential structures, except where such compliance is impossible or impractical in an existing structure and an alternative method or procedure providing satisfactory results is available. The corporation shall arrange for inspection of a representative portion of the work performed pursuant to this chapter. As used in this section, the term “attic” means any air spaces between the ceiling and roof of a residential dwelling which are accessible for the purpose of the installation of insulation.
An electrical or gas corporation shall provide for payment by a customer for whom home insulation has been installed pursuant to this chapter through such periodic billing procedures as may be established by the corporation. The corporation may require an initial payment toward the insulation services of not greater than 20 percent with the balance due payable in equal installments during a period of 36 months following completion of the work, or at such greater rate of repayment as the customer may elect. Finance charges shall not be greater than the maximum allowable finance charges permitted for retail installment contracts. Acceptable credit cards may be utilized in lieu of these financial arrangements.
As an alternative to the provisions of Section 2786, an electrical or gas corporation may conclude financial arrangements with one or more lending institutions in this state engaged in making home improvement loans to provide loans to customers for purposes of home insulation pursuant to this chapter. The corporation may provide for payment of the loan balance by the customer through the corporation’s regular bill for public utility services. Any such financial arrangements shall include all of the following provisions:
The amount financed shall be payable in equal installments during a period of 36 months following completion of the work, or at such greater rate of repayment as the customer may elect.
Provision that the corporation shall not be liable to the lending institution in the event of the customer’s default.
Provision that approval of the customer’s credit shall be at the option of the lending institution.
Notwithstanding any language contained in this section, acceptable credit cards may be utilized in lieu of the above provisions.
The commission shall allow for purposes of setting the rates of any electrical or gas corporation participating in a home insulation assistance and financing program all expenses which the commission finds are reasonably related to the implementation and administration of the program, including commercial advertising. The commission may disapprove any such advertising or promotion which the commission finds is not reasonably designed to promote the success of the home insulation financial assistance program.
Notwithstanding any provision of this part, the commission may permit or require any electrical or gas corporation subject to its jurisdiction to institute energy conservation programs for its customers, including related financial assistance at terms found reasonable by the commission. Such terms may include any provision of this chapter. This chapter shall not apply to solar water heating systems or active solar space conditioning systems. The commission shall initiate appropriate actions to secure exemptions or waivers which may be required under federal law. Nothing in this chapter shall expand, limit, or contract the general powers of the commission contained in this part or the authority of the commission regarding the terms and conditions of service by a utility. Any work requiring a license pursuant to Chapter 9 of Division 3 (commencing with Section 7000) of the Business and Professions Code which is performed pursuant to such an energy conservation program shall be performed by a licensed contractor.
The commission shall require an electrical or gas corporation to perform home weatherization services for low-income customers if the commission determines that a significant need for those services exists in the corporation’s service territory, taking into consideration both the cost-effectiveness of the services and the policy of reducing the hardships facing low-income households.
For purposes of this section, “weatherization” may include, where feasible, any of the following measures for any dwelling unit:
Attic insulation.
Caulking.
Weatherstripping.
Low-flow showerhead.
Waterheater blanket.
Door and building envelope repairs that reduce air infiltration.
The commission shall direct an electrical or gas corporation to provide as many of these measures as are feasible for each eligible low-income dwelling unit.
For purposes of this section, “weatherization” may also include other building conservation measures, energy management technology, energy-efficient appliances, and energy education programs determined by the commission to be feasible, taking into consideration for all measures both the cost-effectiveness of the measures as a whole and the policy of reducing energy-related hardships facing low-income households.
Weatherization programs shall use the needs assessment pursuant to Section 382.1 to maximize efficiency of delivery.
For purposes of this section, “energy management technology” may include a product, service, or software that allows a customer to better understand and manage electricity or gas use in the customer’s home.
For purposes of this section, “low-income customers” means persons and families whose household income is at or below 250 percent of the federal poverty level.
The commission shall not increase the authorized budgets for the Energy Savings Assistance Program based on the expansion of income eligibility made under paragraph (1).
This section shall become operative on July 1, 2022.
CHAPTER 6.5. Transfer of Facilities in Master-Metered Mobilehome Parks and Manufactured Housing Communities to Gas or Electric Corporation Ownership [2791. - 2799.]
The owner of a master-metered mobilehome park or manufactured housing community that provides gas or electric service to residents may transfer ownership and operational responsibility to the gas or electric corporation providing service in the area in which the park or community is located pursuant to this chapter, or as the park or community owner and the serving gas or electric corporation mutually agree.
Costs, including both costs related to transfer procedures and costs related to construction, related to the transfer of ownership process, whether or not resulting in a transfer of ownership to the serving gas or electric corporation, shall not be passed through to the park or community residents. Costs related to the transfer of ownership process, whether or not resulting in a transfer of ownership to the serving gas or electric corporation, shall not be passed through to the gas or electric corporation, except as otherwise provided in this chapter.
Residents of mobilehome parks and manufactured housing communities constructed after January 1, 1997, shall be individually metered and served by gas and electric distribution facilities owned, operated, and maintained by the gas or electric corporation providing the service in the area where the new park or community is located consistent with the commission’s orders regarding unbundling, aggregation, master-metering, and selection of suppliers by residential customers. Each gas and electric corporation shall cooperate with the owner of any park or community constructed after January 1, 1997, to ensure timely and expeditious installation of the gas and electric distribution system and to eliminate any delay in the design, construction, permitting, and operation of the gas and electric system in the park or community.
Upon receipt of a written notice of intent to transfer from the mobilehome park or manufactured housing community owner, the gas or electric corporation shall within 90 days do all of the following:
Meet with the park or community owner to describe the procedures involved in a transfer of ownership and operation responsibility.
Perform a preliminary review of the gas or electric system, or both, in the park or community.
Inspect documentation provided by the park or community owner of the construction, operation, and condition of the gas or electric system, or both.
Advise the park or community owner concerning the general condition of the plant and equipment, along with a preliminary opinion concerning the extent of construction work or other activity necessary to comply with Section 2794.
Offer a preliminary nonbinding estimate of the cost of transfer.
Offer the park or community owner a preliminary nonbinding cost estimate to perform an engineering evaluation and estimate the construction work and equipment replacement to be performed by the gas or electric corporation at the owner’s expense.
The gas or electric corporation shall develop the cost estimate for the engineering evaluation in good faith using the same methodology as is used for similar projects. The preliminary cost estimate shall be effective for a minimum of 90 days. The gas or electric corporation shall give the owner timely notice of any increase in the estimated cost of the engineering evaluation.
During 1997, gas and electric corporations shall make a good faith effort to respond within 90 days to the notice provided in subdivision (a).
The gas or electric corporation may charge a fee for the initial inspection not to exceed one hundred fifty dollars ($150).
Upon receipt from the park or community owner of a deposit representing the gas or electric corporation’s estimated cost of the engineering evaluation, the gas or electric corporation shall, within 90 days, do all of the following:
Develop an engineering plan for bringing the gas or electric system to the standard described in Section 2794, incorporating all relevant documentation including plans, drawings, engineering studies, and other existing documentation provided by the park or community owner, and considering incorporation of all portions of the gas or electric system found to be used, useful, and compatible.
Develop an appraisal of the value to the gas or electric corporation of the physical plant and equipment found to be used, useful, and compatible that comprise the gas or electric system, or both, to be transferred, including an estimate of the remaining useful life of the gas or electric system. The value to the gas or electric corporation shall take into consideration the expenditures by the park or community owner to comply with the criteria established in Section 2794.
Present a proposal, in sufficient detail to serve as a bid document for the transfer of ownership of the system to the gas or electric corporation.
The proposal may be based on either of the following approaches or as the park or community owner and the gas or electric corporation mutually agree:
The park or community owner is responsible for all construction and equipment replacement activity, if any, at the park or community owner’s expense less any credits or allowances, if any, including credits or allowances based on incremental increases in the gas or electric corporation’s revenues associated with the park or community owner’s investment in the gas or electric system. The construction and equipment replacement and the credits and allowances shall be based on the principles established in the gas or electric corporation’s line and service extension rules, if applicable.
The gas or electric corporation shall pay the park or community owner for the appraised value to the gas or electric corporation of any gas or electric distribution facilities found to be used, useful, and compatible. If any new facilities are necessary, the park or community owner shall be responsible for the costs of the excavation, installation of substructures, conduit and meter panels, and surface repairs. Except as provided in paragraph (4) of subdivision (c), the gas or electric corporation shall be responsible for the costs of any additional construction and equipment replacement, including cabling and transformers.
The proposal shall include the following:
Any specific requirements or costs, or both, with respect to the presence of used and useful materials or equipment that are nonstandard, including, but not limited to, inventory requirements, specialized equipment requirements, or specialized personnel or training.
Any specific requirements or costs, or both, with respect to the presence of exceptional construction conditions or operation and maintenance conditions.
If the actual cost of the engineering evaluation is greater than the gas or electric corporation estimate, the park or community owner shall pay the gas or electric corporation the difference within 30 days of receipt of notice. If the actual cost of the engineering evaluation is less than the deposit, the gas or electric corporation shall pay the park or community owner the difference within 30 days. The content of the proposal shall become the property of the park or community owner.
Within 90 days of receipt of the proposal for transfer of ownership, a park or community owner may do any of the following:
Present objections to the gas or electric corporation in writing for resolution and may require mediation of the commission if the parties are unable to resolve the objection.
Decline to proceed, without prejudice to the right to present a new notice at any future date.
Accept the proposal and contract with the gas or electric corporation for completion of the construction work and equipment replacement, if any, or the acquisition of the gas or electric system, or both.
Accept the proposal and contract with an approved third party for completion of the construction work and equipment replacement, if any, in accordance with the applicable gas or electric corporation applicant installation rules.
Any new facilities provided by the gas or electric corporation to extend distribution or service facilities from the existing gas or electric corporation system within the park to previously undeveloped locations shall be provided in accordance with line extension rules and service extension rules contained in gas or electric corporation tariffs filed with the commission, including any and all free extensions, allowances, and advances subject to refund.
Upon completion of construction work and equipment replacement, if any, receipt of appropriate inspection approval from the gas or electric corporation and authorities having jurisdiction for the inspections, and completion of all financial transactions among the parties, the park or community owner shall transfer and the gas or electric corporation shall acquire ownership and operational responsibility for the gas or electric system.
Upon receipt of the proposal described in paragraph (3) of subdivision (a), the park or community owner shall notify the park residents concerning the pendency of a transfer process request and the provisions of the transfer process law.
A gas or electric system shall be considered acceptable for transfer if it is in compliance with the following criteria:
It is capable of providing the end users a safe and reliable source of gas or electric service.
It meets the commission’s general orders, is compatible, and, in the case of new construction, meets the gas or electric corporation’s design and construction standards insofar as they are related to safety and reliability. The parties may waive these requirements by mutual agreement and, where necessary, with commission approval. The deviations as are agreed upon may be reflected in the purchase price.
It is capable of serving the customary expected load in the park or community determined in accordance with a site-specific study, studies of comparable parks or communities, industry standards, and the gas or electric corporation’s rules as approved by the commission.
As used in this section, “customary expected load” means the anticipated level of service demanded by the dwelling units in the park or community. The park or community owner shall not be responsible for betterments or improvements to the gas or electric corporation’s distribution system facilities or operations that do not benefit the park or community.
Satisfaction of the criteria shall not require any particular system architecture or replacement of used and useful equipment, plant, or facilities, except as needed to comply with subdivision (a). Equipment, facilities, or plant that are part of the existing gas or electric system shall be considered compatible unless their presence in the system would cause substantial increase in the frequency or duration of outages in the case of failure or emergency, or they have no remaining useful life. Pursuant to subdivision (c) of Section 2793, equipment, facilities, or plant that require special training for the gas or electric corporation’s employees, or require the gas or electric corporation to maintain inventories of nonstandard equipment may be considered compatible, but their presence may be reflected in the appraised value or the cost imposed on the park or community owner.
The park or community owner and the gas or electric corporation shall develop a cost for the transfer of the gas or electric system that reflects the factors in Section 2793, indemnity and liability issues, and any other factors as the parties may mutually agree upon, and to which the gas or electric corporation’s ratepayers are indifferent. The parties may agree on a schedule for phasing in facilities to meet expected load increases and betterments, and the costs associated with those activities.
During the pendency of a transfer request, the owner of the park or community shall be responsible for the continued maintenance to preserve the integrity of the park or community gas or electric system and safe and reliable operation of the park or community system in accordance with applicable laws.
During the pendency of a transfer request the owner of the park or community shall be liable for injury and damage resulting from operation of the submetered gas and electric system. After transfer the gas or electric corporation shall assume responsibility for operation of the gas or electric system and provision of service to residents of the park or community and shall assume liability for any future injury or damage resulting from operation of the gas or electric system except with respect to defects known to the park or community owner and not disclosed to the gas or electric corporation during the transfer of ownership process.
The commission shall permit the gas or electric corporation to recover in its revenue requirement and rates all costs to acquire, improve, upgrade, operate, and maintain transferred mobilehome park or manufactured housing community gas or electric systems.
The commission shall adopt a standard form of agreement for transfer of gas and electric distribution facilities in mobilehome parks and manufactured housing communities that shall be the basis for expedited approval of the transfers. The contract shall be based on this chapter, the regulations of the commission, and on gas or electric corporation rules and regulations, as approved by the commission.
The mobilehome park or manufactured housing community owner may, by written notice, stop the transfer process at any time. Within 60 days of delivery to the park or community owner of an itemized bill, the owner shall reimburse the gas or electric corporation for all costs incurred through the date notice is provided.
At any time during the transfer of ownership process, either party may apply to the commission for informal mediation and resolution of any issue, finding, determination, or delay in the conversion process.
If the initiation of the transfer process does not result in a transfer of the park or community owner’s gas or electric system to the gas or electric corporation, all information, data, reports, studies, and proposals shall be retained by the gas or electric corporation for a period of five years or offered to the park or community owner. Prior to disposal of the records, the gas or electric corporation shall offer them to the park or community owner, except that the gas or electric corporation shall not be required to provide proprietary information to the park or community owner.
CHAPTER 7. Private Energy Producers [2801. - 2829.]
ARTICLE 1. General Provisions and Definitions [2801. - 2807.]
The Legislature hereby finds and declares that in order to promote the more rapid development of new sources of natural gas and electric energy, to maintain the economic vitality of the state through the continuing production of goods and the employment of its people, and to promote the efficient utilization and distribution of energy, it is desirable and necessary to encourage private energy producers to competitively develop independent sources of natural gas and electric energy not otherwise available to California consumers served by public utilities, to require the transmission by public utilities of such energy for private energy producers under certain conditions, and remove unnecessary barriers to energy transactions involving private energy producers.
“Private energy producer” includes every person, corporation, city, county, district, and public agency of the state generating or producing electricity not generated from conventional sources or natural gas for energy either directly or as a byproduct solely for his or its own use or the use of his or its tenants; or generating or producing electricity, or owning the means thereof, to or for any electrical corporation, heat corporation, state agency, city, county, district, or an association thereof, but not to or for the public for any other purpose. Notwithstanding any other provision of law, a private energy producer shall not be found to be a public utility subject to the general jurisdiction of the commission solely because of conducting any activity authorized by this chapter.
“Interconnection” means the facilities necessary to physically connect the energy source of and the point of use by a private energy producer with the existing transmission facilities of a public utility, and shall include any necessary transformation, compression or other facilities necessary to make such interconnection effective.
“Transmission service” means the intrastate transfer of electricity or natural gas by a public utility for any private energy producer between the points of interconnection for use within this state in the service area of the utility.
“Conventional power source” means power derived from nuclear energy or the operation of a hydropower facility greater than 30 megawatts or the combustion of fossil fuels, unless cogeneration technology, as defined in Section 25134 of the Public Resources Code, is employed in the production of such power.
“Fossil fuel” means a mixture of hydrocarbons including coal, petroleum, or natural gas, occurring in and extracted from underground deposits.
“Standby charge” means a charge by an electrical corporation for providing standby generation, transmission, and distribution facilities to a private energy producer employing other than a conventional power source for the generation of electricity.
ARTICLE 2. Interconnection of Facilities [2811. - 2816.]
In order to promote the more efficient use and distribution of natural gas or electric energy and eliminate the necessity for construction of transmission facilities for gas or electricity produced by a private energy producer separate from those which may already exist to serve the same area and are owned and operated by a public utility subject to the jurisdiction and control of the Public Utilities Commission, the commission shall authorize the construction of an interconnection by a private energy producer upon application of such producer if the commission makes the findings required by Sections 2812 and 2812.5. The commission shall render its decision on any application filed pursuant to this chapter within 180 days of receipt of the application or at such later time as may be mutually agreed upon by the commission, the applicant, and the interconnecting public utility.
Upon application of a private energy producer, and after notice to any affected public utility and hearing thereon, the commission shall authorize such producer to construct an interconnection for the purpose of transporting natural gas, if the commission finds: (1) that such interconnection is in the public interest and for the general public benefit, (2) involves natural gas located within this state in the service area of the public utility, ultimately consumed within this state, and which would otherwise be undeveloped because a public utility is unable or unwilling to purchase it at a price the commission finds to be reasonable, (3) would not cause energy which would likely otherwise be made available to the general public to be diverted to the private energy producer, and (4) that the energy has substantially the equivalent quality and characteristics as the energy in the utility’s transmission system with which the interconnection would be made. The commission shall prescribe such reasonable terms, conditions, and requirements as it deems appropriate.
Upon application of a private energy producer, and after notice to any affected public utility and hearing thereon, the commission shall authorize such producer to construct an interconnection for the purpose of transmitting electricity, if the commission finds:
That no uncompensated burden will be placed upon the utility or utilities furnishing the transmission service.
That furnishing the transmission service will not result in any added costs or any other adverse consequences for the customers of the electrical corporation.
That the facilities proposed in the application will be used to transmit power from other than a conventional power source for generating electrical power.
The commission shall prescribe such reasonable terms, conditions, and requirements as it deems appropriate.
The private energy producer shall be required to provide and to pay the total cost of the interconnection as well as any costs associated with providing a transmission capacity sufficient to handle that portion of the energy generated by the private energy producer that is over and above the capacity otherwise required by the public utility to service its utility customers and meet other authorized commitments. The public utility shall not be required to construct any additional electric or gas facilities on its system or to acquire any real property by eminent domain or otherwise for such facilities, in order to perform the service contemplated by this chapter unless the cost of such additional facilities or acquisitions are to be borne by the private energy producer.
Nothing in this chapter shall require that any private energy producer perform any service or deliver any commodity to the public or any portion thereof, for compensation or otherwise, except as provided in this article.
Every public utility shall keep accurate records of transactions with a private energy producer, and of the use of the public utility’s facilities by the private energy producer, pursuant to an interconnection ordered or approved by the commission and shall render such reports thereon to the commission as the commission may from time to time require. The commission may disapprove any such transaction or use if, after hearing, it finds such transaction or use to be inconsistent with this chapter or any rule, regulation, or order of the commission.
ARTICLE 3. Rights, Obligations, and Charges [2821. - 2829.]
The commission shall approve and establish equitable charges to be paid by an electrical corporation which purchases electricity or electrical generating capacity, or both, from any private energy producer employing other than a conventional power source for the generation of electricity.
The commission, on its own motion or on application of an electrical corporation or a private energy producer, may also specify the prices, terms, and conditions for the purchase or sale of electricity or electrical generating capacity, or both, between an electrical corporation and a private energy producer, and these prices, terms, and conditions, so specified, shall be considered reasonable and prudent for all purposes. The commission may act to specify these prices, terms, and conditions on its own motion or on application of an electrical corporation or a private energy producer.
Every private energy producer employing hydroelectric facilities, who executes a contract with an electrical corporation on or after January 1, 1988, or prior to that date, for the purchase of electricity or electrical generating capacity, or both, shall obtain and provide proof of compliance by the private energy producer with all state laws relating to the control, appropriation, use, and distribution of water, including, but not limited to, the obtaining of applicable licenses and permits. The private energy producer shall also provide proof of compliance with the federal Clean Water Act.
For the purpose of providing proof of compliance with all state laws relating to the control, appropriation, use, and distribution of water, the electrical corporation shall require the private energy producer to provide either of the following:
Certification from the State Water Resources Control Board that a water right permit has been issued for the operation of the hydroelectric facility.
Certification from the State Water Resources Control Board that, in the opinion of the board, the private energy producer possesses riparian rights or other water rights which authorize the operation of the hydroelectric facility.
The requirements of paragraph (1) shall apply only to contracts involving hydroelectric projects which have not been accepted by the electrical corporation for commercial operation prior to May 18, 1987.
Every contract executed by a private energy producer who is in violation of paragraph (1) is void and unenforceable on and after whichever of the following dates applies:
February 29, 1988, for contracts involving hydroelectric projects which have been accepted by the electrical corporation for commercial operation on or after May 18, 1987, and prior to January 1, 1988.
The 60th day after a project has been accepted by the electrical corporation for commercial operation, for contracts involving hydroelectric projects which are accepted by the electrical corporation for commercial operation on or after January 1, 1988.
The commission shall disallow, for purposes of establishing rates for an electrical corporation, all amounts expended for the purchase of electricity pursuant to a contract that is void and unenforceable under this subdivision.
For the purposes of providing proof of compliance with the federal Clean Water Act, the electrical corporation shall require the private energy producer to provide a statement from the State Water Resources Control Board that certification pursuant to Section 401 of the federal Clean Water Act has either been granted or waived by the board for operation of the hydroelectric facility. The board shall not waive certification unless the board finds that there is reasonable assurance that the project shall comply with all applicable requirements of the federal Clean Water Act and state water quality laws. If the board cannot make this finding within the period provided for certification, the board shall either certify upon conditions that provide reasonable assurance of compliance or deny certification.
The requirements of paragraph (1) shall apply only to contracts involving hydroelectric projects which have not been accepted by the electrical corporation for commercial operation prior to January 1, 1992.
Every contract executed by a private energy producer who is in violation of paragraph (1) is void and unenforceable on and after whichever of the following dates applies:
March 1, 1993, for contracts involving hydroelectric projects which are accepted by the electrical corporation for commercial operation between January 1, 1992, and December 31, 1992.
The 60th day after having been accepted by the electrical corporation for commercial operation, for contracts involving hydroelectric projects which are accepted by the electrical corporation for commercial operation on or after January 1, 1993.
The commission shall disallow, for purposes of establishing rates for an electrical corporation, all amounts expended for the purchase of electricity pursuant to a contract that is void and unenforceable under this subdivision.
Subdivision (d) does not apply to any private energy producer if all of the following conditions are met:
The electrical corporation did not make timely written demand for the proof of compliance required by paragraph (1) of subdivision (d).
On or before the date the project was accepted by the electrical corporation for commercial operation, the private energy producer was in fact in compliance with all applicable state laws relating to the control, appropriation, use, and distribution of water, including, but not limited to, those laws that require the obtaining of all applicable entitlements.
Prior to October 14, 1991, the private energy producer has provided proof of the applicable certification from the State Water Resources Control Board pursuant to subparagraph (A) of paragraph (1) of subdivision (d), which proof contains further certification from the State Water Resources Control Board of the existence of the condition identified in paragraph (2) of subdivision (f).
For purposes of meeting the requirements of subdivision (d) or (e), or of providing certification required under Section 26013 of the Public Resources Code, the private energy producer shall furnish information as is reasonably required by the State Water Resources Control Board to document a claim of right, a certification, or a waiver. Every private energy producer requesting certification and a statement from the board pursuant to subdivisions (d) and (e), or to Section 26013 of the Public Resources Code, shall pay to the board at the time of filing the request, a fee of two hundred fifty dollars ($250) to cover the reasonable cost of the board in evaluating and processing the certification request.
As used in this section, “Federal Clean Water Act” means the federal Water Pollution Control Act (Sections 1251 et seq. of Volume 33 of the United States Code) and acts amendatory thereof or supplementary thereto.
The Legislature finds and declares all of the following:
Small power producers provide important alternative sources of electrical energy.
The commission is required to approve and establish equitable charges to be paid by electrical corporations which purchase electricity or electrical generating capacity, or both, from qualifying small power producers.
The commission recognized the importance of developing standard offer contracts based on long-run avoided costs in order to encourage the development of qualifying small power producers. On September 7, 1983, in Decision 83-09-054, the commission approved interim standard offer No. 4, which established a long-term power purchase contract.
Many pioneer small power producers operating prior to September 7, 1983, did so under power purchase contracts based on short-term energy prices and long-term capacity prices. When interim standard offer No. 4 was approved, the commission allowed its provisions to be offered to qualified facility projects which had not yet obtained construction financing or otherwise entered a contract and started construction. Pioneer small power producers with existing contracts were not allowed to switch to the new interim standard offer No. 4 until their existing contracts were no longer in effect.
On April 17, 1985, pursuant to Decision 85-04-075, the commission suspended all payment options offered under interim standard offer No. 4 due to the contrasting of excessive energy capacity, and the conclusion that prices were too high.
Many qualifying small power producers who were operating under contracts made prior to September 7, 1983, were thus precluded by the commission from adopting interim standard offer No. 4, and may be required to accept new prices and terms which provide less compensation than the suspended interim standard offer No. 4.
These financially stressed qualifying small power producers assert they were unfairly denied the opportunity to adopt interim standard offer No. 4 by the commission. They also assert that much of the capacity contracted for under the suspended interim standard offer No. 4 will never be constructed. They further allege that they are being forced to close small powerplants which are currently in operation while producers with interim standard offer No. 4 contracts are constructing new plants.
The commission shall approve and establish standby charges for electrical corporations. The commission may act in this regard on its own motion or on application of an electrical corporation or a private energy producer.
The commission shall approve and establish charges for transmission service. The commission may act in this regard on its own motion or on application of an electrical corporation or a private energy producer.
The commission shall conduct a review of the charges paid by electrical corporations for electricity generated from other than conventional power sources and furnished to such corporations. Following such review, the commission shall consider adjustments in such charges to encourage the generation of electricity from other than conventional power sources.
The commission shall conduct a review of standby charges charged by electrical corporations. Following such review, the commission shall consider adjustments in such charges to encourage the utilization of electricity generated from other than conventional power sources and to enable electrical corporations to review the costs of providing standby service.
The commission shall conduct a review of charges for transmission service made by electrical corporations for the transmission of electricity generated from other than conventional power sources. Following such review, the commission shall consider adjustments in such charges to encourage the generation of electricity from other than conventional power sources.
The commission shall establish requirements for the administration of power purchase contracts between electrical corporations and private energy producers. For any project which has not received all regulatory permits at the time of the commission’s review of a proposed project deferral agreement, the commission shall, at a minimum, apply both of the following requirements:
Prohibit payments by an electrical corporation to a private energy producer to defer the construction of a private energy project unless the private energy producer agrees to repay all deferral payments charged to ratepayers in the event the project is not constructed and operating by the time the deferral period expires.
Require the private energy producer to provide adequate security to ensure repayment of those ratepayer charges.
Subdivision (a) does not apply to a power purchase contract between an electrical corporation and a private energy producer which is a major customer of the electrical corporation, if the contract is negotiated pursuant to procedures prescribed by the commission and for the purpose of retaining that customer.
As used in this section, the following terms have the following meanings:
“Benefiting account” means an electricity account, or more than one account, mutually agreed upon by Pacific Gas and Electric Company and the City of Davis.
“Bill credit” means credits calculated based upon the electricity generation component of the rate schedule applicable to a benefiting account, as applied to the net metered quantities of electricity.
“PVUSA” means the photovoltaic electricity generation facility selected by the City of Davis, located at 24662 County Road, Davis, California, with a rated peak electricity generation capacity of 600 kilowatts, and as it may be expanded, not to exceed one megawatt of peak generation capacity.
“Net metered” means the electricity output from the PVUSA.
“Environmental attributes” associated with the PVUSA include, but are not limited to, the credits, benefits, emissions reductions, environmental air quality credits, and emissions reduction credits, offsets, and allowances, however entitled resulting from the avoidance of the emission of any gas, chemical, or other substance attributable to the PVUSA.
The City of Davis may elect to designate a benefiting account, or more than one account, to receive bill credit for the electricity generated by the PVUSA, if all of the following conditions are met:
A benefiting account receives service under a time-of-use rate schedule.
The electricity output of the PVUSA is metered for time of use to allow allocation of each bill credit to correspond to the time-of-use period of a benefiting account.
All costs associated with the metering requirements of paragraphs (1) and (2) are the responsibility of the City of Davis.
All electricity delivered to the electrical grid by the PVUSA is the property of Pacific Gas and Electric Company.
PVUSA does not sell electricity delivered to the electrical grid to a third party.
The right, title, and interest in the environmental attributes associated with the electricity delivered to the electrical grid by the PVUSA are the property of Nuon Renewable Ventures USA, LLC.
A benefiting account shall be billed on a monthly basis, as follows:
Not more frequently that once per year, and upon providing Pacific Gas and Electric Company with a minimum of 60 days notice, the City of Davis may elect to change a benefiting account. Any credit resulting from the application of this section earned prior to the change in a benefiting account that has not been used as of the date of the change in the benefit account, shall be applied, and may only be applied, to a benefiting account as changed.
Pacific Gas and Electric Company shall file an advice letter with the Public Utilities Commission, that complies with this section, not later than 10 days after the effective date of this section, proposing a rate tariff for a benefiting account. The commission, within 30 days of the date of filing, shall approve the proposed tariff, or specify conforming changes to be made by Pacific Gas and Electric Company to be filed in a new advice letter.
The City of Davis may terminate its election pursuant to subdivision (b), upon providing Pacific Gas and Electric Company with a minimum of 60 days notice. Should the City of Davis sell its interest in the PVUSA, or sell the electricity generated by the PVUSA, in a manner other than required by this section, upon the date of either event, and the earliest date if both events occur, no further bill credit pursuant to paragraph (2) of subdivision (b) may be earned. Only credit earned prior to that date shall be made to a benefiting account.
The Legislature finds and declares that credit for a benefiting account for the electricity output from the PVUSA are in the public interest in order to value the production of this unique, wholly renewable resource electricity generation facility located in, and owned in part by, the City of Davis. Because of the unique circumstances applicable only to the PVUSA a statute of general applicability cannot be enacted within the meaning of subdivision (b) of Section 16 of Article IV of the California Constitution. Therefore, this special statute is necessary.
The Legislature finds and declares that a program to provide net energy metering combined with net surplus compensation, co-energy metering, and wind energy co-metering for eligible customer-generators is one way to encourage substantial private investment in renewable energy resources, stimulate in-state economic growth, reduce demand for electricity during peak consumption periods, help stabilize California’s energy supply infrastructure, enhance the continued diversification of California’s energy resource mix, reduce interconnection and administrative costs for electricity suppliers, and encourage conservation and efficiency.
As used in this section, the following terms have the following meanings:
“Co-energy metering” means a program that is the same in all other respects as a net energy metering program, except that the local publicly owned electric utility has elected to apply a generation-to-generation energy and time-of-use credit formula as provided in subdivision (i).
“Electrical cooperative” means an electrical cooperative as defined in Section 2776.
“Electric utility” means an electrical corporation, a local publicly owned electric utility, or an electrical cooperative, or any other entity, except an electric service provider, that offers electrical service. This section shall not apply to a local publicly owned electric utility that serves more than 750,000 customers and that also conveys water to its customers.
“Eligible customer-generator” means a residential customer, small commercial customer as defined in subdivision (h) of Section 331, or commercial, industrial, or agricultural customer of an electric utility, who uses a renewable electrical generation facility, or a combination of those facilities, with a total capacity of not more than one megawatt, that is located on the customer’s owned, leased, or rented premises, and is interconnected and operates in parallel with the electrical grid, and is intended primarily to offset part or all of the customer’s own electrical requirements.
Notwithstanding subparagraph (A), “eligible customer-generator” includes the Department of Corrections and Rehabilitation using a renewable electrical generation technology, or a combination of renewable electrical generation technologies, with a total capacity of not more than eight megawatts, that is located on the department’s owned, leased, or rented premises, and is interconnected and operates in parallel with the electrical grid, and is intended primarily to offset part or all of the facility’s own electrical requirements. The amount of any wind generation exported to the electrical grid shall not exceed 1.35 megawatt at any time.
Notwithstanding paragraph (2) of subdivision (e), an electrical corporation shall be afforded a prudent but necessary time, as determined by the executive director of the commission, to study the impacts of a request for interconnection of a renewable generator with a capacity of greater than one megawatt under this subparagraph. If the study reveals the need for upgrades to the transmission or distribution system arising solely from the interconnection, the electrical corporation shall be afforded the time necessary to complete those upgrades before the interconnection and those costs shall be borne by the customer-generator. Upgrade projects shall comply with applicable state and federal requirements, including requirements of the Federal Energy Regulatory Commission.
For purposes of this subparagraph, a “United States Armed Forces base or facility” is an establishment under the jurisdiction of the United States Army, Navy, Air Force, Marine Corps, Space Force, or Coast Guard.
Notwithstanding subparagraph (A), a United States Armed Forces base or facility is an “eligible customer-generator” if the base or facility uses a renewable electrical generation facility, or a combination of those facilities, the renewable electrical generation facility is located on premises owned, leased, or rented by the United States Armed Forces base or facility, the renewable electrical generation facility is interconnected and operates in parallel with the electrical grid, the renewable electrical generation facility is intended primarily to offset part or all of the base or facility’s own electrical requirements, and the renewable electrical generation facility has a generating capacity that does not exceed the lesser of 12 megawatts or one megawatt greater than the minimum load of the base or facility over the prior 36 months. Unless prohibited by federal law, a renewable electrical generation facility shall not be eligible for net energy metering for privatized military housing pursuant to this subparagraph if the renewable electrical generation facility was procured using a sole source process. A renewable electrical generation facility procured using best value criteria, if otherwise eligible, may be used for net energy metering for privatized military housing pursuant to this subparagraph. For these purposes, “best value criteria” means a value determined by objective criteria and may include, but is not limited to, price, features, functions, and life-cycle costs.
A United States Armed Forces base or facility that is an eligible customer generator pursuant to this subparagraph shall not receive compensation for exported generation.
Notwithstanding paragraph (2) of subdivision (e), an electrical corporation shall be afforded a prudent but necessary time, as determined by the executive director of the commission but not less than 60 working days, to study the impacts of a request for interconnection of a renewable electrical generation facility with a capacity of greater than one megawatt pursuant to this subparagraph. If the study reveals the need for upgrades to the transmission or distribution system arising solely from the interconnection, the electrical corporation shall be afforded the time necessary to complete those upgrades before the interconnection and the costs of those upgrades shall be borne by the eligible customer-generator. Upgrade projects shall comply with applicable state and federal requirements, including requirements of the Federal Energy Regulatory Commission. For any renewable generation facility that interconnects directly to the transmission grid or that requires transmission upgrades, the United States Armed Forces base or facility shall comply with all Federal Energy Regulatory Commission interconnection procedures and requirements.
An electrical corporation shall make a tariff, as approved by the commission, available pursuant to this subparagraph by November 1, 2015.
This subparagraph shall not apply to a tariff made available pursuant to Section 2827.1.
“Large electrical corporation” means an electrical corporation with more than 100,000 service connections in California.
“Net energy metering” means measuring the difference between the electricity supplied through the electrical grid and the electricity generated by an eligible customer-generator and fed back to the electrical grid over a 12-month period as described in subdivisions (c) and (h).
“Net surplus customer-generator” means an eligible customer-generator that generates more electricity during a 12-month period than is supplied by the electric utility to the eligible customer-generator during the same 12-month period.
“Net surplus electricity” means all electricity generated by an eligible customer-generator measured in kilowatthours over a 12-month period that exceeds the amount of electricity consumed by that eligible customer-generator.
“Net surplus electricity compensation” means a per kilowatthour rate offered by the electric utility to the net surplus customer-generator for net surplus electricity that is set by the ratemaking authority pursuant to subdivision (h).
“Ratemaking authority” means, for an electrical corporation, the commission, for an electrical cooperative, its ratesetting body selected by its shareholders or members, and for a local publicly owned electric utility, the local elected body responsible for setting the rates of the local publicly owned utility.
“Renewable electrical generation facility” means a facility that generates electricity from a renewable source listed in paragraph (1) of subdivision (a) of Section 25741 of the Public Resources Code. A small hydroelectric generation facility is not an eligible renewable electrical generation facility if it will cause an adverse impact on instream beneficial uses or cause a change in the volume or timing of streamflow.
“Wind energy co-metering” means any wind energy project greater than 50 kilowatts, but not exceeding one megawatt, where the difference between the electricity supplied through the electrical grid and the electricity generated by an eligible customer-generator and fed back to the electrical grid over a 12-month period is as described in subdivision (h). Wind energy co-metering shall be accomplished pursuant to Section 2827.8.
On an annual basis, every electric utility shall make available to the ratemaking authority information on the total rated generating capacity used by eligible customer-generators that are customers of that provider in the provider’s service area and the net surplus electricity purchased by the electric utility pursuant to this section.
An electric service provider operating pursuant to Section 394 shall make available to the ratemaking authority the information required by this paragraph for each eligible customer-generator that is their customer for each service area of an electrical corporation, local publicly owned electrical utility, or electrical cooperative, in which the eligible customer-generator has net energy metering.
The ratemaking authority shall develop a process for making the information required by this paragraph available to electric utilities, and for using that information to determine when, pursuant to paragraphs (1) and (4), an electric utility is not obligated to provide net energy metering to additional eligible customer-generators in its service area.
The commission shall require every large electrical corporation to make the standard contract or tariff available to eligible customer-generators, continuously and without interruption, until such times as the large electrical corporation reaches its net energy metering program limit or July 1, 2017, whichever is earlier. A large electrical corporation reaches its program limit when the combined total peak demand of all electricity used by eligible customer-generators served by all the electric utilities in the large electrical corporation’s service area furnishing net energy metering to eligible customer-generators exceeds 5 percent of the aggregate customer peak demand of those electric utilities. For purposes of calculating a large electrical corporation’s program limit, “aggregate customer peak demand” means the highest sum of the noncoincident peak demands of all of the large electrical corporation’s customers that occurs in any calendar year. To determine the aggregate customer peak demand, every large electrical corporation shall use a uniform method approved by the commission. The program limit calculated pursuant to this paragraph shall not be less than the following:
For Pacific Gas and Electric Company, when it has made 2,409 megawatts of nameplate generating capacity available to eligible customer-generators.
Every large electrical corporation shall file a monthly report with the commission detailing the progress toward the net energy metering program limit established in subparagraph (B). The report shall include separate calculations on progress toward the limits based on operating solar energy systems, cumulative numbers of interconnection requests for net energy metering eligible systems, and any other criteria required by the commission.
Beginning July 1, 2017, or upon reaching the net metering program limit of subparagraph (B), whichever is earlier, the obligation of a large electrical corporation to provide service pursuant to a standard contract or tariff shall be pursuant to Section 2827.1 and applicable state and federal requirements.
Every electric utility shall make all necessary forms and contracts for net energy metering and net surplus electricity compensation service available for download from the Internet.
Every electric utility shall ensure that requests for establishment of net energy metering and net surplus electricity compensation are processed in a time period not exceeding that for similarly situated customers requesting new electric service, but not to exceed 30 working days from the date it receives a completed application form for net energy metering service or net surplus electricity compensation, including a signed interconnection agreement from an eligible customer-generator and the electric inspection clearance from the governmental authority having jurisdiction.
Every electric utility shall ensure that requests for an interconnection agreement from an eligible customer-generator are processed in a time period not to exceed 30 working days from the date it receives a completed application form from the eligible customer-generator for an interconnection agreement.
If an electric utility is unable to process a request within the allowable timeframe pursuant to paragraph (1) or (2), it shall notify the eligible customer-generator and the ratemaking authority of the reason for its inability to process the request and the expected completion date.
If a customer participates in direct transactions pursuant to paragraph (1) of subdivision (b) of Section 365, or Section 365.1, with an electric service provider that does not provide distribution service for the direct transactions, the electric utility that provides distribution service for the eligible customer-generator is not obligated to provide net energy metering or net surplus electricity compensation to the customer.
If a customer participates in direct transactions pursuant to paragraph (1) of subdivision (b) of Section 365 or 365.1 with an electric service provider, and the customer is an eligible customer-generator, the electric utility that provides distribution service for the direct transactions may recover from the customer’s electric service provider the incremental costs of metering and billing service related to net energy metering and net surplus electricity compensation in an amount set by the ratemaking authority.
Except for the time-variant kilowatthour pricing portion of any tariff adopted by the commission pursuant to paragraph (4) of subdivision (a) of Section 2851, each net energy metering contract or tariff shall be identical, with respect to rate structure, all retail rate components, and any monthly charges, to the contract or tariff to which the same customer would be assigned if the customer did not use a renewable electrical generation facility, except that eligible customer-generators shall not be assessed standby charges on the electrical generating capacity or the kilowatthour production of a renewable electrical generation facility. The charges for all retail rate components for eligible customer-generators shall be based exclusively on the customer-generator’s net kilowatthour consumption over a 12-month period, without regard to the eligible customer-generator’s choice as to from whom it purchases electricity that is not self-generated. Any new or additional demand charge, standby charge, customer charge, minimum monthly charge, interconnection charge, or any other charge that would increase an eligible customer-generator’s costs beyond those of other customers who are not eligible customer-generators in the rate class to which the eligible customer-generator would otherwise be assigned if the customer did not own, lease, rent, or otherwise operate a renewable electrical generation facility is contrary to the intent of this section, and shall not form a part of net energy metering contracts or tariffs.
For eligible customer-generators, the net energy metering calculation shall be made by measuring the difference between the electricity supplied to the eligible customer-generator and the electricity generated by the eligible customer-generator and fed back to the electrical grid over a 12-month period. The following rules shall apply to the annualized net metering calculation:
The eligible residential or small commercial customer-generator, at the end of each 12-month period following the date of final interconnection of the eligible customer-generator’s system with an electric utility, and at each anniversary date thereafter, shall be billed for electricity used during that 12-month period. The electric utility shall determine if the eligible residential or small commercial customer-generator was a net consumer or a net surplus customer-generator during that period.
At the end of each 12-month period, where the electricity supplied during the period by the electric utility exceeds the electricity generated by the eligible residential or small commercial customer-generator during that same period, the eligible residential or small commercial customer-generator is a net electricity consumer and the electric utility shall be owed compensation for the eligible customer-generator’s net kilowatthour consumption over that 12-month period. The compensation owed for the eligible residential or small commercial customer-generator’s consumption shall be calculated as follows:
For all eligible customer-generators taking service under contracts or tariffs employing “baseline” and “over baseline” rates, any net monthly consumption of electricity shall be calculated according to the terms of the contract or tariff to which the same customer would be assigned to, or be eligible for, if the customer was not an eligible customer-generator. If those same customer-generators are net generators over a billing period, the net kilowatthours generated shall be valued at the same price per kilowatthour as the electric utility would charge for the baseline quantity of electricity during that billing period, and if the number of kilowatthours generated exceeds the baseline quantity, the excess shall be valued at the same price per kilowatthour as the electric utility would charge for electricity over the baseline quantity during that billing period.
For all eligible customer-generators taking service under contracts or tariffs employing time-of-use rates, any net monthly consumption of electricity shall be calculated according to the terms of the contract or tariff to which the same customer would be assigned, or be eligible for, if the customer was not an eligible customer-generator. When those same customer-generators are net generators during any discrete time-of-use period, the net kilowatthours produced shall be valued at the same price per kilowatthour as the electric utility would charge for retail kilowatthour sales during that same time-of-use period. If the eligible customer-generator’s time-of-use electrical meter is unable to measure the flow of electricity in two directions, paragraph (1) of subdivision (c) shall apply.
For all eligible residential and small commercial customer-generators and for each billing period, the net balance of moneys owed to the electric utility for net consumption of electricity or credits owed to the eligible customer-generator for net generation of electricity shall be carried forward as a monetary value until the end of each 12-month period. For all eligible commercial, industrial, and agricultural customer-generators, the net balance of moneys owed shall be paid in accordance with the electric utility’s normal billing cycle, except that if the eligible commercial, industrial, or agricultural customer-generator is a net electricity producer over a normal billing cycle, any excess kilowatthours generated during the billing cycle shall be carried over to the following billing period as a monetary value, calculated according to the procedures set forth in this section, and appear as a credit on the eligible commercial, industrial, or agricultural customer-generator’s account, until the end of the annual period when paragraph (3) shall apply.
At the end of each 12-month period, where the electricity generated by the eligible customer-generator during the 12-month period exceeds the electricity supplied by the electric utility during that same period, the eligible customer-generator is a net surplus customer-generator and the electric utility, upon an affirmative election by the net surplus customer-generator, shall either (A) provide net surplus electricity compensation for any net surplus electricity generated during the prior 12-month period, or (B) allow the net surplus customer-generator to apply the net surplus electricity as a credit for kilowatthours subsequently supplied by the electric utility to the net surplus customer-generator. For an eligible customer-generator that does not affirmatively elect to receive service pursuant to net surplus electricity compensation, the electric utility shall retain any excess kilowatthours generated during the prior 12-month period. The eligible customer-generator not affirmatively electing to receive service pursuant to net surplus electricity compensation shall not be owed any compensation for the net surplus electricity unless the electric utility enters into a purchase agreement with the eligible customer-generator for those excess kilowatthours. Every electric utility shall provide notice to eligible customer-generators that they are eligible to receive net surplus electricity compensation for net surplus electricity, that they must elect to receive net surplus electricity compensation, and that the 12-month period commences when the electric utility receives the eligible customer-generator’s election. For an electric utility that is an electrical corporation or electrical cooperative, the commission may adopt requirements for providing notice and the manner by which eligible customer-generators may elect to receive net surplus electricity compensation.
An eligible customer-generator with multiple meters may elect to aggregate the electrical load of the meters located on the property where the renewable electrical generation facility is located and on all property adjacent or contiguous to the property on which the renewable electrical generation facility is located, if those properties are solely owned, leased, or rented by the eligible customer-generator. If the eligible customer-generator elects to aggregate the electric load pursuant to this paragraph, the electric utility shall use the aggregated load for the purpose of determining whether an eligible customer-generator is a net consumer or a net surplus customer-generator during a 12-month period.
If an eligible customer-generator chooses to aggregate pursuant to subparagraph (A), the eligible customer-generator shall be permanently ineligible to receive net surplus electricity compensation, and the electric utility shall retain any kilowatthours in excess of the eligible customer-generator’s aggregated electrical load generated during the 12-month period.
If an eligible customer-generator with multiple meters elects to aggregate the electrical load of those meters pursuant to subparagraph (A), and different rate schedules are applicable to service at any of those meters, the electricity generated by the renewable electrical generation facility shall be allocated to each of the meters in proportion to the electrical load served by those meters. For example, if the eligible customer-generator receives electric service through three meters, two meters being at an agricultural rate that each provide service to 25 percent of the customer’s total load, and a third meter, at a commercial rate, that provides service to 50 percent of the customer’s total load, then 50 percent of the electrical generation of the eligible renewable generation facility shall be allocated to the third meter that provides service at the commercial rate and 25 percent of the generation shall be allocated to each of the two meters providing service at the agricultural rate. This proportionate allocation shall be computed each billing period.
This paragraph shall not become operative for an electrical corporation unless the commission determines that allowing eligible customer-generators to aggregate their load from multiple meters will not result in an increase in the expected revenue obligations of customers who are not eligible customer-generators. The commission shall make this determination by September 30, 2013. In making this determination, the commission shall determine if there are any public purpose or other noncommodity charges that the eligible customer-generators would pay pursuant to the net energy metering program as it exists prior to aggregation, that the eligible customer-generator would not pay if permitted to aggregate the electrical load of multiple meters pursuant to this paragraph.
A local publicly owned electric utility or electrical cooperative shall only allow eligible customer-generators to aggregate their load if the utility’s ratemaking authority determines that allowing eligible customer-generators to aggregate their load from multiple meters will not result in an increase in the expected revenue obligations of customers that are not eligible customer-generators. The ratemaking authority of a local publicly owned electric utility or electrical cooperative shall make this determination within 180 days of the first request made by an eligible customer-generator to aggregate their load. In making the determination, the ratemaking authority shall determine if there are any public purpose or other noncommodity charges that the eligible customer-generator would pay pursuant to the net energy metering or co-energy metering program of the utility as it exists prior to aggregation, that the eligible customer-generator would not pay if permitted to aggregate the electrical load of multiple meters pursuant to this paragraph. If the ratemaking authority determines that load aggregation will not cause an incremental rate impact on the utility’s customers that are not eligible customer-generators, the local publicly owned electric utility or electrical cooperative shall permit an eligible customer-generator to elect to aggregate the electrical load of multiple meters pursuant to this paragraph. The ratemaking authority may reconsider any determination made pursuant to this subparagraph in a subsequent public proceeding.
For purposes of this paragraph, parcels that are divided by a street, highway, or public thoroughfare are considered contiguous, provided they are otherwise contiguous and under the same ownership.
An eligible customer-generator may only elect to aggregate the electrical load of multiple meters if the renewable electrical generation facility, or a combination of those facilities, has a total generating capacity of not more than one megawatt.
Notwithstanding subdivision (g), an eligible customer-generator electing to aggregate the electrical load of multiple meters pursuant to this subdivision shall remit service charges for the cost of providing billing services to the electric utility that provides service to the meters.
The ratemaking authority shall establish a net surplus electricity compensation valuation to compensate the net surplus customer-generator for the value of net surplus electricity generated by the net surplus customer-generator. The commission shall establish the valuation in a ratemaking proceeding. The ratemaking authority for a local publicly owned electric utility shall establish the valuation in a public proceeding. The net surplus electricity compensation valuation shall be established so as to provide the net surplus customer-generator just and reasonable compensation for the value of net surplus electricity, while leaving other ratepayers unaffected. The ratemaking authority shall determine whether the compensation will include, where appropriate justification exists, either or both of the following components:
The value of the electricity itself.
The value of the renewable attributes of the electricity.
In establishing the rate pursuant to subparagraph (A), the ratemaking authority shall ensure that the rate does not result in a shifting of costs between eligible customer-generators and other bundled service customers.
Upon adoption of the net surplus electricity compensation rate by the ratemaking authority, any renewable energy credit, as defined in Section 399.12, for net surplus electricity purchased by the electric utility shall belong to the electric utility. Any renewable energy credit associated with electricity generated by the eligible customer-generator that is utilized by the eligible customer-generator shall remain the property of the eligible customer-generator.
Upon adoption of the net surplus electricity compensation rate by the ratemaking authority, the net surplus electricity purchased by the electric utility shall count toward the electric utility’s renewables portfolio standard annual procurement targets for the purposes of paragraph (1) of subdivision (b) of Section 399.15, or for a local publicly owned electric utility, the renewables portfolio standard annual procurement targets established pursuant to Section 399.30.
The electric utility shall provide every eligible residential or small commercial customer-generator with net electricity consumption and net surplus electricity generation information with each regular bill. That information shall include the current monetary balance owed the electric utility for net electricity consumed, or the net surplus electricity generated, since the last 12-month period ended. Notwithstanding this subdivision, an electric utility shall permit that customer to pay monthly for net energy consumed.
If an eligible residential or small commercial customer-generator terminates the customer relationship with the electric utility, the electric utility shall reconcile the eligible customer-generator’s consumption and production of electricity during any part of a 12-month period following the last reconciliation, according to the requirements set forth in this subdivision, except that those requirements shall apply only to the months since the most recent 12-month bill.
If an electric service provider or electric utility providing net energy metering to a residential or small commercial customer-generator ceases providing that electric service to that customer during any 12-month period, and the customer-generator enters into a new net energy metering contract or tariff with a new electric service provider or electric utility, the 12-month period, with respect to that new electric service provider or electric utility, shall commence on the date on which the new electric service provider or electric utility first supplies electric service to the customer-generator.
Notwithstanding any other provisions of this section, paragraphs (1), (2), and (3) shall apply to an eligible customer-generator with a capacity of more than 10 kilowatts, but not exceeding one megawatt, that receives electric service from a local publicly owned electric utility that has elected to utilize a co-energy metering program unless the local publicly owned electric utility chooses to provide service for eligible customer-generators with a capacity of more than 10 kilowatts in accordance with subdivisions (g) and (h):
A renewable electrical generation facility used by an eligible customer-generator shall meet all applicable safety and performance standards established by the National Electrical Code, the Institute of Electrical and Electronics Engineers, and accredited testing laboratories, including Underwriters Laboratories Incorporated and, where applicable, rules of the commission regarding safety and reliability. A customer-generator whose renewable electrical generation facility meets those standards and rules shall not be required to install additional controls, perform or pay for additional tests, or purchase additional liability insurance.
If the commission determines that there are cost or revenue obligations for an electrical corporation that may not be recovered from customer-generators acting pursuant to this section, those obligations shall remain within the customer class from which any shortfall occurred and shall not be shifted to any other customer class. Net energy metering and co-energy metering customers shall not be exempt from the public goods charges imposed pursuant to Article 7 (commencing with Section 381), Article 8 (commencing with Section 385), or Article 15 (commencing with Section 399) of Chapter 2.3 of Part 1.
A net energy metering, co-energy metering, or wind energy co-metering customer shall reimburse the Department of Water Resources for all charges that would otherwise be imposed on the customer by the commission to recover bond-related costs pursuant to an agreement between the commission and the Department of Water Resources pursuant to Section 80110 of the Water Code, as well as the costs of the department equal to the share of the department’s estimated net unavoidable power purchase contract costs attributable to the customer. The commission shall incorporate the determination into an existing proceeding before the commission, and shall ensure that the charges are nonbypassable. Until the commission has made a determination regarding the nonbypassable charges, net energy metering, co-energy metering, and wind energy co-metering shall continue under the same rules, procedures, terms, and conditions as were applicable on December 31, 2002.
In implementing the requirements of subdivisions (k) and (l), an eligible customer-generator shall not be required to replace its existing meter except as set forth in paragraph (1) of subdivision (c), nor shall the electric utility require additional measurement of usage beyond that which is necessary for customers in the same rate class as the eligible customer-generator.
It is the intent of the Legislature that the Treasurer incorporate net energy metering, including net surplus electricity compensation, co-energy metering, and wind energy co-metering projects undertaken pursuant to this section as sustainable building methods or distributive energy technologies for purposes of evaluating low-income housing projects.
For purposes of this section, “eligible customer-generator,” “large electrical corporation,” and “renewable electrical generation facility” have the same meanings as defined in Section 2827.
Notwithstanding any other law, the commission shall develop a standard contract or tariff, which may include net energy metering, for eligible customer-generators with a renewable electrical generation facility that is a customer of a large electrical corporation no later than December 31, 2015. The commission may develop the standard contract or tariff prior to December 31, 2015, and may require a large electrical corporation that has reached the net energy metering program limit of subparagraph (B) of paragraph (4) of subdivision (c) of Section 2827 to offer the standard contract or tariff to eligible customer-generators. A large electrical corporation shall offer the standard contract or tariff to an eligible customer-generator beginning July 1, 2017, or prior to that date if ordered to do so by the commission because it has reached the net energy metering program limit of subparagraph (B) of paragraph (4) of subdivision (c) of Section 2827. The commission may revise the standard contract or tariff as appropriate to achieve the objectives of this section. In developing the standard contract or tariff, the commission shall do all of the following:
Ensure that the standard contract or tariff made available to eligible customer-generators ensures that customer-sited renewable distributed generation continues to grow sustainably and include specific alternatives designed for growth among residential customers in disadvantaged communities.
Establish terms of service and billing rules for eligible customer-generators.
Ensure that the standard contract or tariff made available to eligible customer-generators is based on the costs and benefits of the renewable electrical generation facility.
Ensure that the total benefits of the standard contract or tariff to all customers and the electrical system are approximately equal to the total costs.
Allow projects greater than one megawatt that do not have significant impact on the distribution grid to be built to the size of the onsite load if the projects with a capacity of more than one megawatt are subject to reasonable interconnection charges established pursuant to the commission’s Electric Rule 21 and applicable state and federal requirements.
Establish a transition period during which eligible customer-generators taking service under a net energy metering tariff or contract prior to July 1, 2017, or until the electrical corporation reaches its net energy metering program limit pursuant to subparagraph (B) of paragraph (4) of subdivision (c) of Section 2827, whichever is earlier, shall be eligible to continue service under the previously applicable net energy metering tariff for a length of time to be determined by the commission by March 31, 2014. Any rules adopted by the commission shall consider a reasonable expected payback period based on the year the customer initially took service under the tariff or contract authorized by Section 2827.
The commission shall determine which rates and tariffs are applicable to customer generators only during a rulemaking proceeding. Any fixed charges for residential customer generators that differ from the fixed charges allowed pursuant to subdivision (e) of Section 739.9 shall be authorized only in a rulemaking proceeding involving every large electrical corporation. The commission shall ensure customer generators are provided electric service at rates that are just and reasonable.
Beginning July 1, 2017, or when ordered to do so by the commission because the large electrical corporation has reached its capacity limitation of subparagraph (B) of paragraph (4) of subdivision (c) of Section 2827, all new eligible customer-generators shall be subject to the standard contract or tariff developed by the commission and any rules, terms, and rates developed pursuant to subdivision (b). There shall be no limitation on the amount of generating capacity or number of new eligible customer-generators entitled to receive service pursuant to the standard contract or tariff after July 1, 2017. An eligible customer-generator that has received service under a net energy metering standard contract or tariff pursuant to Section 2827 that is no longer eligible to receive service shall be eligible to receive service pursuant to the standard contract or tariff developed by the commission pursuant to this section.
Generation eligible for net energy metering that has all local and state permits required to commence construction on or before December 31, 2002, and has completed construction on or before September 30, 2003, shall be entitled, regardless of any change in customer or ownership of the energy system, for the life of the installation, to the net energy metering terms in effect on the date the local and state permits were acquired.
Notwithstanding any other provisions of this article, the following provisions apply to an eligible customer-generator utilizing wind energy co-metering with a capacity of more than 50 kilowatts, but not exceeding one megawatt, unless approved by the electric service provider.
The eligible customer-generator shall be required to utilize a meter, or multiple meters, capable of separately measuring electricity flow in both directions. Nothing in this section precludes the use of advanced metering infrastructure devices. All meters shall provide “time-of-use” measurements of electricity flow, and the customer shall take service on a time-of-use rate schedule. If the existing meter of the eligible customer-generator is not a time-of-use meter or is not capable of measuring total flow of energy in both directions, the eligible customer-generator is responsible for all expenses involved in purchasing and installing a meter that is both time-of-use and able to measure total electricity flow in both directions. This subdivision shall not restrict the ability of an eligible customer-generator to utilize any economic incentives provided by a government agency or the electric service provider to reduce its costs for purchasing and installing a time-of-use meter.
The consumption of electricity from the electric service provider for wind energy co-metering by an eligible customer-generator shall be priced in accordance with the standard rate charged to the eligible customer-generator in accordance with the rate structure to which the customer would be assigned if the customer did not use an eligible wind electrical generating facility. The generation of electricity provided to the electric service provider shall result in a credit to the eligible customer-generator and shall be priced in accordance with the generation component, excluding surcharges to cover the purchase of power by the Department of Water Resources, established under the applicable structure to which the customer would be assigned if the customer did not use an eligible wind electrical generating facility.
As used in this section, the following terms have the following meanings:
“Electrical corporation” means an electrical corporation, as defined in Section 218.
“Eligible fuel cell electrical generating facility” means a facility that includes the following:
Integrated powerplant systems containing a stack, tubular array, or other functionally similar configuration used to electrochemically convert fuel to electricity.
An inverter and fuel processing system where necessary.
Other plant equipment, including heat recovery equipment used to support the facility’s operation or its energy conversion.
“Eligible fuel cell customer-generator” means a customer of an electrical corporation that meets all the following criteria:
Uses a fuel cell electrical generating facility with a generating capacity of not more than five megawatts that is located on or adjacent to the customer’s owned, leased, or rented premises, is interconnected and operates in parallel with the electrical grid while the grid is operational or in a grid independent mode when the grid is nonoperational, and is sized to offset part or all of the eligible fuel cell customer-generator’s own electrical requirements.
Is the recipient of local, state, or federal funds, or who self-finances projects designed to encourage the development of eligible fuel cell electrical generating facilities.
Uses technology the commission has determined will achieve reductions in emissions of greenhouse gases pursuant to subdivision (b).
Complies with the emissions standards adopted by the State Air Resources Board pursuant to the distributed generation certification program requirements of Section 94203 of Title 17 of the California Code of Regulations, or any successor regulation.
For purposes of this paragraph, a person or entity is a customer of the electrical corporation if the customer is physically located within the service territory of the electrical corporation and receives bundled service, distribution service, or transmission service from the electrical corporation.
“Net energy metering” means measuring the difference between the electricity supplied through the electrical grid and the difference between the electricity generated by an eligible fuel cell electrical generating facility and fed back to the electrical grid over a 12-month period as described in subdivision (f). Net energy metering shall be accomplished using a time-of-use meter capable of registering the flow of electricity in two directions. If the existing electrical meter of an eligible fuel cell customer-generator is not capable of measuring the flow of electricity in two directions, the eligible fuel cell customer-generator shall be responsible for all expenses involved in purchasing and installing a meter that is able to measure electricity flow in two directions. If an additional meter or meters are installed, the net energy metering calculation shall yield a result identical to that of a time-of-use meter.
Not later than March 31, 2017, the State Air Resources Board, in consultation with the Energy Commission, shall establish a schedule of annual greenhouse gas emissions reduction standards for a fuel cell electrical generation resource for purposes of clause (iii) of subparagraph (A) of paragraph (3) of subdivision (a) and shall update the schedule every three years with applicable standards for each intervening year.
The greenhouse gas emissions reduction standards shall ensure that each fuel cell electrical generation resource, for purposes of clause (iii) of subparagraph (A) of paragraph (3) of subdivision (a), reduces greenhouse gas emissions compared to the electrical grid resources, including renewable resources, that the fuel cell electrical generation resource displaces, accounting for both procurement and operation of the electrical grid.
In determining the eligibility for the cumulative rated generating capacity within an electrical corporation’s service territory, preference shall be given to facilities that, at the time of installation, are located in a community with significant exposure to air contaminants or localized air contaminants, or both, including, but not limited to, communities of minority populations or low-income populations, or both, based on the ambient air quality standards established pursuant to Division 26 (commencing with Section 39000) of the Health and Safety Code.
Each net energy metering contract or tariff shall be identical, with respect to rate structure, all retail rate components, and any monthly charges, to the contract or tariff to which the customer would be assigned if the customer was not an eligible fuel cell customer-generator. Any new or additional demand charge, standby charge, customer charge, minimum monthly charge, interconnection charge, or other charge that would increase an eligible fuel cell customer-generator’s costs beyond those of other customers in the rate class to which the eligible fuel cell customer-generator would otherwise be assigned are contrary to the intent of the Legislature in enacting this section, and shall not form a part of net energy metering tariffs.
The commission shall authorize an electrical corporation to charge a fuel cell customer-generator a fee based on the cost to the utility associated with providing interconnection inspection services for that fuel cell customer-generator.
The net metering calculation shall be made by measuring the difference between the electricity supplied to the eligible fuel cell customer-generator and the electricity generated by the eligible fuel cell customer-generator and fed back to the electrical grid over a 12-month period. The following rules apply to the annualized metering calculation:
The eligible fuel cell customer-generator shall, at the end of each 12-month period following the date of final interconnection of the eligible fuel cell electrical generating facility with an electrical corporation, and at each anniversary date thereafter, be billed for electricity used during that period. The electrical corporation shall determine if the eligible fuel cell customer-generator was a net consumer or a net producer of electricity during that period. For purposes of determining if the eligible fuel cell customer-generator was a net consumer or a net producer of electricity during that period, the electrical corporation shall aggregate the electrical load of the meters located on the property where the eligible fuel cell electrical generating facility is located and on all property adjacent or contiguous to the property on which the facility is located, if those properties are solely owned, leased, or rented by the eligible fuel cell customer-generator. Each aggregated account shall be billed and measured according to a time-of-use rate schedule.
At the end of each 12-month period, where the electricity supplied during the period by the electrical corporation exceeds the electricity generated by the eligible fuel cell customer-generator during that same period, the eligible fuel cell customer-generator is a net electricity consumer and the electrical corporation shall be owed compensation for the eligible fuel cell customer-generator’s net kilowatthour consumption over that same period. The compensation owed for the eligible fuel cell customer-generator’s consumption shall be calculated as follows:
The generation charges for any net monthly consumption of electricity shall be calculated according to the terms of the tariff to which the same customer would be assigned to or be eligible for if the customer was not an eligible fuel cell customer-generator. When the eligible fuel cell customer-generator is a net generator during any discrete time-of-use period, the net kilowatthours produced shall be valued at the same price per kilowatthour as the electrical corporation would charge for retail kilowatthour sales for generation, exclusive of any surcharges, during that same time-of-use period. If the eligible fuel cell customer-generator’s time-of-use electrical meter is unable to measure the flow of electricity in two directions, paragraph (4) of subdivision (a) applies. All other charges, other than generation charges, shall be calculated in accordance with the eligible fuel cell customer-generator’s applicable tariff and based on the total kilowatthours delivered by the electrical corporation to the eligible fuel cell customer-generator. To the extent that charges for transmission and distribution services are recovered through demand charges in any particular month, no standby reservation charges shall apply in that monthly billing cycle.
The net balance of moneys owed shall be paid in accordance with the electrical corporation’s normal billing cycle.
At the end of each 12-month period, where the electricity generated by the eligible fuel cell customer-generator during the 12-month period exceeds the electricity supplied by the electrical corporation during that same period, the eligible fuel cell customer-generator is a net electricity producer and the electrical corporation shall retain any excess kilowatthours generated during the prior 12-month period. The eligible fuel cell customer-generator shall not be owed any compensation for those excess kilowatthours.
If an eligible fuel cell customer-generator terminates service with the electrical corporation, the electrical corporation shall reconcile the eligible fuel cell customer-generator’s consumption and production of electricity during any 12-month period.
A fuel cell electrical generating facility shall not be eligible for the tariff unless it commences operation on or before December 31, 2023, unless a later enacted statute, that is chaptered on or before December 31, 2023, extends this eligibility commencement date. The tariff shall remain in effect for an eligible fuel cell electrical generating facility that commences operation pursuant to the tariff on or before December 31, 2023. A fuel cell customer-generator is eligible for the tariff established pursuant to this section only for the operating life of the eligible fuel cell electrical generating facility.
As used in this section, the following terms have the following meanings:
“Appropriate TOU tariff” means the Time-of-Use tariff that would be applicable to the City and County of San Francisco account at the renewable electricity generation facility site if the facility at the site were a Pacific Gas and Electric Company bundled customer, as determined by Pacific Gas and Electric Company.
“Environmental attributes” associated with the Hetch Hetchy Water and Power (HHWP) at-site renewable generation and HHWP remote renewable generation include, but are not limited to, the credits, benefits, emissions reductions, environmental air quality credits, and emissions reduction credits, offsets, and allowances, however entitled, resulting from the avoidance of the emissions of any gas, chemical, or other substance attributable to the Hetch Hetchy Water and Power renewable electricity generation facility owned by the City and County of San Francisco.
“HHWP at-site renewable generation” means the electricity generated by renewable electricity generation facilities designated by the City and County of San Francisco pursuant to subdivision (b).
“HHWP remote renewable generation” means the electricity generated by renewable electricity generation facilities designated by the City and County of San Francisco pursuant to subdivision (h), to provide electricity to qualifying remote load.
“Interconnection Agreement” means the 1987 agreement between Pacific Gas and Electric Company and the City and County of San Francisco, as filed with and accepted by the Federal Energy Regulatory Commission (FERC), and as amended from time to time with FERC approval, which provides for rates for transmission, distribution, and sales of supplemental electricity to the City and County of San Francisco. Nothing in this section shall waive or modify the rights of parties under the Interconnection Agreement or the jurisdiction of the FERC over rates set forth in the Interconnection Agreement.
“Qualifying remote load” means the electricity demand of the City and County of San Francisco for load served under the Interconnection Agreement, at sites that are separate from, and not adjacent to, the sites where the renewable electricity generation facility is located, and serviced through a meter or multiple meters other than those serving the sites where the renewable electricity generation facility is located. The separate or remote sites may be designated by the City and County of San Francisco, both inside and outside of the City and County of San Francisco. Where the separate or remote sites are outside the City and County of San Francisco, they shall be located within 20 miles of the City and County of San Francisco or within 20 miles of a HHWP remote renewable generation facility. There is no wattage limit on qualifying remote load.
“Renewable electricity generation facility” means a facility for the generation of electricity that satisfies both of the following requirements:
The facility uses biomass, solar thermal, photovoltaic, wind, geothermal, fuel cells using renewable fuels, small hydroelectric generation of 30 megawatts or less, digester gas, municipal solid waste conversion, landfill gas, ocean wave, ocean thermal, or tidal current, and any additions or enhancements to the facility using that technology.
The facility is owned, or under lease or contract to, the City and County of San Francisco for at least a five-year term and for the full output of electricity from the facility.
The City and County of San Francisco may elect to designate specific renewable electricity generation facilities as HHWP at-site renewable generation, if all of the following conditions are met:
Total peak generating capacity does not exceed 15 megawatts.
The renewable electricity generation facility utilizes a meter, or multiple meters, capable of separately measuring electricity flow in both directions. All meters shall provide “time-of-use” measurement information. If the existing meter at the site of the facility is not capable of providing time-of-use information or is not capable of separately measuring total flow of energy in both directions, the City and County of San Francisco is responsible for all expenses involved in purchasing and installing a meter or meters that are both capable of providing time-of-use information and able to separately measure total electricity flow in both directions.
The amount of all electricity delivered to the electric grid by the designated HHWP at-site renewable generation is the property of Pacific Gas and Electric Company.
The City and County of San Francisco does not sell electricity delivered to the electric grid from the designated HHWP at-site renewable generation to a third party.
For each site of a renewable electricity generation facility that comprises the HHWP at-site renewable generation, Pacific Gas and Electric Company shall identify the appropriate TOU tariff for that site. Any electricity exported to the Pacific Gas and Electric Company grid at that site that is not generated from HHWP remote renewable generation pursuant to subdivision (h) shall, for each time-of-use period, result in a monetary credit to be applied monthly as a credit or offset against the invoice created pursuant to the Interconnection Agreement and shall be valued at the generation component of the appropriate TOU tariff. The commission shall determine if it is appropriate to increase the credit to reflect any additional value derived from the location or the environmental attributes of, the designated HHWP at-site renewable generation.
Monthly charges and credit amounts for HHWP at-site renewable generation are interim and subject to an accounting true-up, consistent with commission policies and practices. The true-up shall be performed annually or upon the termination, for any reason, of the Interconnection Agreement. The true-up shall accomplish the following:
Pursuant to this section, the offset to charges under the Interconnection Agreement is the medium to convey credits earned under this section. Nothing in this section shall be construed to affect in any way the rights and obligations of the City and County of San Francisco and Pacific Gas and Electric Company under the Interconnection Agreement. If the Interconnection Agreement terminates, the City and County of San Francisco and Pacific Gas and Electric Company shall develop an alternative mechanism to convey credits earned under this section for HHWP at-site renewable generation and for HHWP remote renewable generation, in a manner that accomplishes the same result as that accomplished pursuant to the Interconnection Agreement.
Pacific Gas and Electric Company shall file an advice letter with the commission, that complies with this section, not later than 10 days after the City and County of San Francisco first designates the specific renewable electricity generation facilities that will comprise HHWP at-site renewable generation.
The commission, within 30 days of the date of filing of the advice letter, shall approve the advice letter or specify conforming changes to be made by Pacific Gas and Electric Company to be filed in an amended advice letter within 30 days.
The City and County of San Francisco may terminate its election pursuant to subdivisions (b), (c), (d), and (h), upon providing Pacific Gas and Electric Company with a minimum of 60 days’ written notice.
The City and County of San Francisco may elect to designate specific renewable electricity generation facilities or a portion of specific renewable electricity generation facilities as HHWP remote renewable generation and may use HHWP remote renewable generation to supply electricity to specific facilities designated as qualifying remote load up to the amount of electricity being used by the qualifying remote load.
The City and County of San Francisco shall receive no credit or offset for the electricity exported to the grid from HHWP remote renewable generation, in excess of the electricity delivered from the grid to qualifying remote load.
Pacific Gas and Electric Company shall accept any electricity exported to the grid as HHWP remote renewable generation, up to the amount of electricity being used during the corresponding time period by the qualifying remote load, and treat the electricity accepted as behind the meter generation that offsets the electrical usage of qualifying remote load. Additional rates may apply pursuant to paragraph (6).
The City and County of San Francisco shall be responsible for scheduling the electricity exported to the grid from HHWP remote renewable generation.
Both HHWP remote renewable generation sites and qualifying remote load sites shall have meters capable of measuring exports and usage of electricity that will support determination of credits or offsets pursuant to paragraph (2). The City and County of San Francisco shall be responsible for the costs of the meters required pursuant to this section.
To compensate Pacific Gas and Electric Company for the use of its facilities, the City and County of San Francisco shall pay applicable distribution rates, transmission rates, or distribution and transmission rates, at rate levels determined by the Interconnection Agreement, for all energy delivered to qualifying remote load that comes from HHWP remote renewable generation. When HHWP remote renewable generation and the qualifying remote load it serves are located within the City and County of San Francisco and are interconnected at distribution voltage, the applicable rate for delivery of energy from HHWP remote renewable generation shall be reduced as negotiated pursuant to the Interconnection Agreement.
The appropriate regulatory agency shall ensure that the delivery of electricity by HHWP remote renewable generation to qualifying remote load, and the granting of offsets to the City and County of San Francisco pursuant to this subdivision, do not result in a shifting of costs to bundled service customers, either immediately or over time.
Hetch Hetchy Water and Power shall reimburse Pacific Gas and Electric Company for its reasonable study costs associated with HHWP remote and at-site renewable generation to address interconnection, consistent with applicable regulatory rules, and impacts upon the electric system resulting from the HHWP remote and at-site renewable generation. If the studies identify improvements necessary for the protection of the Pacific Gas and Electric Company electric system, for the protection of its employees, or to ensure reliable delivery of the electricity generated by the HHWP remote and at-site renewable generation facility to qualifying remote load, Hetch Hetchy Water and Power shall pay the reasonable costs of the improvements if it elects to designate the HHWP remote and at-site renewable generation facility to provide electricity for qualifying remote load.
The interconnection of HHWP at-site renewable generation and HHWP remote renewable generation will be accomplished through one or more generator interconnection agreements pursuant to applicable regulatory rules and generator interconnection procedures.
The City and County of San Francisco shall own the environmental attributes associated with the electricity delivered to the electric grid by HHWP at-site renewable generation and HHWP remote renewable generation unless it contracts otherwise.
For purposes of this section, the following terms have the following meanings:
“EBMUD” means the East Bay Municipal Utility District organized and operating pursuant to Division 6 (commencing with Section 11501).
“Environmental attributes” associated with the generation of electricity include the credits, benefits, emissions reductions, environmental air quality credits, and emissions reduction credits, offsets, and allowances, however entitled, resulting from the avoidance of the emissions of any gas, chemical, or other substance attributable to an electricity generation facility.
To ensure that no electrical corporation operates its monopoly transmission and distribution system in a manner that impedes the ability of the EBMUD to reduce its electricity costs through the delivery of electricity generated by EBMUD, an electrical corporation shall meet the requirements of this section.
An electrical corporation that owns and operates transmission and distribution facilities that deliver electricity at one or more locations to the EBMUD’s system shall, upon request by EBMUD, and without discrimination or delay, use the same facilities to deliver electricity generated by EBMUD. EBMUD may elect to designate specific hydroelectric generation facilities owned by EBMUD for the generation of electricity to be delivered to EBMUD, if the following conditions are met:
The amount of all electricity delivered to the electric grid by the designated EBMUD hydroelectric generation is the property of EBMUD.
Ownership and use of the environmental attributes associated with the electricity delivered to the electric grid by EBMUD-designated hydroelectric generation is retained by EBMUD.
To compensate an electrical corporation for the use of its facilities, EBMUD shall pay applicable rates approved by the commission for distribution, or distribution and transmission, or any transmission rates as required under federal law.
On or before January 1, 2009, each electrical corporation that owns and operates transmission and distribution facilities that deliver electricity at one or more locations to the EBMUD system shall file an advice letter with the commission that complies with this section. The commission, within 150 days of the date of filing of the advice letter, shall approve the advice letter or specify conforming changes to be made by the electrical corporation, to be filed in an amended advice letter within 60 days.
The commission shall ensure that the delivery of electricity from EBMUD-designated hydroelectric generation to the EBMUD service territory pursuant to this section does not result in a shifting of costs to the bundled service customers of an electrical corporation, either immediately or over time.
CHAPTER 7.5. Local Government Renewable Energy Self-Generation Program [2830. - 2830.]
As used in this section, the following terms have the following meanings:
“Benefiting account” means an electricity account, or more than one account, that satisfies any of the following:
The account or accounts are located within the geographical boundaries of a local government or, for a campus, within the geographical boundary of the city, county, or city and county in which the campus is located, with the account or accounts being mutually agreed upon by the local government or campus and an electrical corporation.
The account or accounts belong to members of a joint powers authority and are located within the geographical boundaries of the group of public agencies that formed the joint powers authority, if the eligible renewable generating facility and electricity account or accounts are wholly located within a single county within which the joint powers authority is located and electric service is provided by a single electrical corporation, with the account or accounts being mutually agreed upon by the joint powers authority and the electrical corporation.
The account or accounts belong to a tribe and are located on land owned by or under the jurisdiction of the tribe, if the eligible renewable generating facility and electricity account or accounts are wholly located within a single county within which the tribe is located and electrical service is provided by a single electrical corporation, with the account or accounts being mutually agreed upon by the tribe and the electrical corporation.
“Bill credit” means an amount of money credited to a benefiting account that is calculated based upon the time-of-use electricity generation component of the electricity usage charge of the generating account, multiplied by the quantities of electricity generated by an eligible renewable generating facility that are exported to the grid during the corresponding time period. Electricity is exported to the grid if it is generated by an eligible renewable generating facility, is not utilized onsite by the local government, and the electricity flows through the meter site and on to the electrical corporation’s distribution or transmission infrastructure.
“Campus” means an individual community college campus, individual California State University campus, or individual University of California campus.
“Eligible renewable generating facility” means a generation facility that meets all of the following requirements:
Has a generating capacity of no more than five megawatts.
Is an eligible renewable energy resource, as defined in Article 16 (commencing with Section 399.11) of Part 1.
Is located within the geographical boundary of the local government or, for a campus, within the geographical boundary of the city or city and county, if the campus is located in an incorporated area, or county, if the campus is located in an unincorporated area or, for a tribe, on land owned by or under the jurisdiction of the tribe.
Is owned by, operated by, or on property under the control of the local government, campus, or tribe.
Is sized to offset all or part of the electrical load of the benefiting account. For these purposes, premises that are leased by a local government, campus, or tribe are under the control of the local government, campus, or tribe.
“Generating account” means the time-of-use electric service account of the local government or campus where the eligible renewable generating facility is located.
“Local government” means a city, county, whether general law or chartered, city and county, special district, school district, political subdivision, other local public agency, or a joint powers authority formed pursuant to the Joint Exercise of Powers Act (Chapter 5 (commencing with Section 6500) of Division 7 of Title 1 of the Government Code) that has as members public agencies located within the same county and same electrical corporation service territory, but shall not mean the state, any agency or department of the state, other than an individual campus of the University of California or the California State University, or any joint powers authority that has as members public agencies located in different counties or different electrical corporation service territories, or that has as a member the federal government, any federal department or agency, this or another state, or any department or agency of this state or another state.
“Tribe” means a California Native American tribe, as defined in Section 21073 of the Public Resources Code.
Subject to the limitation in subdivision (h), a local government or tribe may elect to receive electric service pursuant to this section if all of the following conditions are met:
The local government or tribe designates one or more benefiting accounts to receive a bill credit.
A benefiting account receives service under a time-of-use rate schedule.
The benefiting account is the responsibility of, and serves property that is owned, operated, or on property under the control of the same local government or tribe that owns, operates, or controls the eligible renewable generating facility.
The electrical output of the eligible renewable generating facility is metered for time of use to allow calculation of the bill credit based upon when the electricity is exported to the grid.
All costs associated with the metering requirements of paragraphs (2) and (4) are the responsibility of the local government or tribe, or its members.
All costs associated with interconnection are the responsibility of the local government or tribe, or its members. For purposes of this paragraph, “interconnection” has the same meaning as defined in Section 2803, except that it applies to the interconnection of an eligible renewable generating facility rather than the energy source of a private energy producer.
The local government or tribe does not sell electricity exported to the electrical grid to a third party.
All electricity exported to the grid by the local government or tribe that is generated by the eligible renewable generating facility becomes the property of the electrical corporation to which the facility is interconnected, but shall not be counted toward the electrical corporation’s total retail sales for purposes of Article 16 (commencing with Section 399.11) of Chapter 2.3 of Part 1. Ownership of the renewable energy credits, as defined in Section 399.12, shall be the same as the ownership of the renewable energy credits associated with electricity that is net metered pursuant to Section 2827.
An electrical corporation shall not be required to compensate a local government or tribe for electricity generated from an eligible renewable facility pursuant to this section in excess of the bill credits applied to the designated benefiting account. A local government renewable generation facility participating pursuant to this section shall not be eligible for any other tariff or program that requires an electrical corporation to purchase generation from that facility while participating in the local government renewable energy self-generation program pursuant to this section.
The following billing and crediting procedures will apply to a local government or tribe electing to receive electric service pursuant to this chapter:
The commission shall ensure that the transfer of a bill credit to a benefiting account does not result in a shifting of costs to bundled service subscribers. The costs associated with the transfer of a bill credit shall include all billing-related expenses.
Not more frequently than once per year, and upon providing the electrical corporation with a minimum of 60 days’ notice, the participating local government or tribe may elect to change a benefiting account. Any credit resulting from the application of this section earned prior to the change in a benefiting account that has not been used as of the date of the change in the benefiting account shall be applied, and may only be applied, to a benefiting account as changed.
A participating local government or tribe shall provide the electrical corporation to which the eligible renewable generating facility will be interconnected with not less than 60 days’ notice prior to the eligible renewable generating facility becoming operational. The electrical corporation shall file an advice letter with the commission that complies with this section not later than 30 days after receipt of the notice proposing a rate tariff for a benefiting account. The commission, within 30 days of the date of filing, shall approve the proposed tariff or specify conforming changes to be made by the electrical corporation to be filed in a new advice letter.
The local government or tribe may terminate its election pursuant to subdivision (b), upon providing the electrical corporation with a minimum of 60 days’ notice. If the local government or tribe sells its interest in the eligible renewable generating facility, or sells the electricity generated by the eligible renewable generating facility, in a manner other than required by this section, upon the date of either event, and the earliest date if both events occur, no further bill credit pursuant to paragraph (3) of subdivision (b) may be earned. Only credit earned prior to that date shall be made to a benefiting account.
An electrical corporation is not obligated to provide a bill credit to a benefiting account that is not designated by a local government prior to the point in time that the combined statewide cumulative rated generating capacity of all eligible renewable generating facilities within the service territories of the state’s three largest electrical corporations reaches 250 megawatts. Only those eligible renewable generating facilities that are providing bill credits to benefiting accounts pursuant to this section shall count toward reaching this 250-megawatt limitation. Each electrical corporation shall only be required to offer service or contracts under this section until that electrical corporation reaches its proportionate share of the 250-megawatt limitation based on the ratio of its peak demand to the total statewide peak demand of all electrical corporations.
This chapter does not apply to an electrical corporation with 60,000 or fewer customer accounts.
CHAPTER 7.6. Green Tariff Shared Renewables Program [2831. - 2833.]
The Legislature finds and declares all of the following:
Building operational generating facilities that utilize sources of renewable energy within California, to supply the state’s demand for electricity, provides significant financial, health, environmental, and workforce benefits to the State of California.
The California Solar Initiative will achieve its goals, resulting in over 150,000 residential and commercial onsite installations of solar energy systems. However, the California Solar Initiative cannot reach all residents and businesses that want to participate and is limited to only solar energy systems and not other eligible renewable energy resources. A green tariff shared renewables program seeks to build on the success of the California Solar Initiative by expanding access to all eligible renewable energy resources to all ratepayers who are currently unable to access the benefits of onsite generation.
There is widespread interest from many large institutional customers, including schools, colleges, universities, local governments, businesses, and the military, for the development of generation facilities that are eligible renewable energy resources to serve more than 33 percent of their energy needs.
Public institutions will benefit from a green tariff shared renewables program’s enhanced flexibility to participate in shared generation facilities that are eligible renewable energy resources.
Building operational generating facilities that are eligible renewable energy resources creates jobs, reduces emissions of greenhouse gases, and promotes energy independence.
Many large energy users in California have pursued onsite electrical generation from eligible renewable energy resources, but cannot achieve their goals due to rooftop or land space limitations, or size limits on net energy metering. The enactment of this chapter will create a mechanism whereby institutional customers, such as military installations, universities, and local governments, as well as commercial customers and groups of individuals, can meet their needs with electrical generation from eligible renewable energy resources.
It is the intent of the Legislature that a green tariff shared renewables program be implemented in such a manner that facilitates a large, sustainable market for offsite electrical generation from facilities that are eligible renewable energy resources, while fairly compensating electrical corporations for the services they provide, without affecting nonparticipating ratepayers.
It is the further intent of the Legislature that a green tariff shared renewables program be implemented in a manner that ensures nonparticipating ratepayer indifference for the remaining bundled service, direct access, and community choice aggregation customers.
This chapter shall be known, and may be cited, as the Green Tariff Shared Renewables Program.
For purposes of this chapter, the following terms have the following meanings:
“Eligible renewable energy resource,” “renewable energy credit,” and “renewables portfolio standard” have the same meaning as those terms have for the California Renewables Portfolio Standard Program (Article 16 (commencing with Section 399.11) of Chapter 2.3 of Part 1).
“Participating utility” means an electrical corporation with 100,000 or more customer accounts in California.
On or before March 1, 2014, a participating utility shall file with the commission an application requesting approval of a green tariff shared renewables program to implement a program that the utility determines is consistent with the legislative findings and statements of intent of Section 2831. Nothing in this chapter limits an electrical corporation with less than 100,000 customer accounts in California from filing an application with the commission to administer a green tariff shared renewables program that is consistent with the legislative findings and statements of intent of Section 2831.
On or before July 1, 2014, the commission shall issue a decision on the participating utility’s application for a green tariff shared renewables program, determining whether to approve or disapprove it, with or without modifications.
After notice and an opportunity for public comment, the commission shall approve an application by a participating utility for a green tariff shared renewables program if the commission determines that the program is reasonable and consistent with the legislative findings and statements of intent of Section 2831.
The requirements of this chapter shall not apply to an electrical corporation that, prior to May 1, 2013, filed an application with the commission to have a green tariff shared renewables program, or an equivalent program of whatever name, provided the commission approves the application with a determination that the program does not shift costs to nonparticipating customers and the application is consistent with this chapter. If the commission has approved a settlement agreement relative to parties contesting an application filed prior to May 1, 2013, the requirements of this section shall not apply if the commission, within a reasonable period of time, requires revisions to the previously approved settlement agreement that requires the program to be consistent with this chapter.
Except as specified in paragraph (2), the commission shall require a green tariff shared renewables program to be administered by a participating utility in accordance with this section.
On and after April 1, 2023, the commission may authorize through an advice letter a participating utility to terminate its green tariff shared renewables program.
Generating facilities participating in a participating utility’s green tariff shared renewables program shall be eligible renewable energy resources with a nameplate rated generating capacity not exceeding 20 megawatts, except for those generating facilities reserved for location in areas identified by the California Environmental Protection Agency as the most impacted and disadvantaged communities pursuant to paragraph (1) of subdivision (d), which shall not exceed one megawatt nameplate rated generating capacity.
A participating utility shall use commission-approved tools and mechanisms to procure additional eligible renewable energy resources for its green tariff shared renewables program from electrical generation facilities that are in addition to those required by the California Renewables Portfolio Standard Program (Article 16 (commencing with Section 399.11) of Chapter 2.3 of Part 1). For purposes of this subdivision, “commission-approved tools and mechanisms” means those procurement methods approved by the commission for an electrical corporation to procure eligible renewable energy resources for purposes of meeting the procurement requirements of the California Renewables Portfolio Standard Program (Article 16 (commencing with Section 399.11) of Chapter 2.3 of Part 1).
A participating utility shall permit customers within the service territory of the utility to purchase electricity pursuant to the tariff approved by the commission to implement the utility’s green tariff shared renewables program, until the utility meets its proportionate share of a statewide limitation of 600 megawatts of customer participation, measured by nameplate rated generating capacity, or the participating utility’s green tariff shared renewables program is terminated or suspended. The proportionate share shall be calculated based on the ratio of each participating utility’s retail sales to total retail sales of electricity by all participating utilities. The commission may place other restrictions on purchases under a green tariff shared renewables program, including restricting participation to a certain level of capacity each year. The following restrictions apply to the statewide 600 megawatt limitation:
One hundred megawatts shall be reserved for facilities that are no larger than one megawatt nameplate rated generating capacity and that are located in areas previously identified by the California Environmental Protection Agency as the most impacted and disadvantaged communities. These communities shall be identified by census tract, and shall be determined to be the most impacted 20 percent based on results from the best available cumulative impact screening methodology designed to identify each of the following:
Areas disproportionately affected by environmental pollution and other hazards that can lead to negative public health effects, exposure, or environmental degradation.
Areas with socioeconomic vulnerability.
For purposes of this paragraph, “previously identified” means identified before commencing construction of the facility.
Not less than 100 megawatts shall be reserved for participation by residential class customers.
Twenty megawatts shall be reserved for the City of Davis.
To the extent possible, a participating utility shall seek to procure eligible renewable energy resources that are located in reasonable proximity to enrolled participants.
A participating utility’s green tariff shared renewables program shall support diverse procurement and the goals of commission General Order 156.
A participating utility’s green tariff shared renewables program shall not allow a customer to subscribe to more than 100 percent of the customer’s electricity demand.
Except as authorized by this subdivision, a participating utility’s green tariff shared renewables program shall not allow a customer to subscribe to more than two megawatts of nameplate generating capacity. This limitation does not apply to a federal, state, or local government, school or school district, county office of education, the California Community Colleges, the California State University, or the University of California.
A participating utility’s green tariff shared renewables program shall not allow any single entity or its affiliates or subsidiaries to subscribe to more than 20 percent of any single calendar year’s total cumulative rated generating capacity.
To the extent possible, a participating utility shall actively market the utility’s green tariff shared renewables program to low-income and minority communities and customers.
Participating customers shall receive bill credits for the generation of a participating eligible renewable energy resource using the class average retail generation cost as established in the participating utility’s approved tariff for the class to which the participating customer belongs, plus a renewables adjustment value representing the difference between the time-of-delivery profile of the eligible renewable energy resource used to serve the participating customer and the class average time-of-delivery profile and the resource adequacy value, if any, of the resource contained in the utility’s green tariff shared renewables program. The renewables adjustment value applicable to a time-of-delivery profile of an eligible renewable energy resource shall be determined according to rules adopted by the commission. For these purposes, “time-of-delivery profile” refers to the daily generating pattern of a participating eligible renewable energy resource over time, the value of which is determined by comparing the generating pattern of that participating eligible renewable energy resource to the demand for electricity over time and other generating resources available to serve that demand.
Participating customers shall pay a renewable generation rate established by the commission, the administrative costs of the participating utility, and any other charges the commission determines are just and reasonable to fully cover the cost of procuring a green tariff shared renewables program’s resources to serve a participating customer’s needs.
A participating customer’s rates shall be debited or credited with any other commission-approved costs or values applicable to the eligible renewable energy resources contained in a participating utility’s green tariff shared renewables program’s portfolio. These additional costs or values shall be applied to new customers when they initially subscribe after the cost or value has been approved by the commission.
Participating customers shall pay all otherwise applicable charges without modification.
A participating utility shall permit a participating customer to subscribe to the program and be provided with a nonbinding estimate of reasonably anticipated bill credits and bill charges, as determined by the commission, for a period of up to 20 years.
A participating utility shall provide support for enhanced community renewables programs to facilitate development of eligible renewable energy resource projects located close to the source of demand.
The commission shall ensure that charges and credits associated with a participating utility’s green tariff shared renewables program are set in a manner that ensures nonparticipant ratepayer indifference for the remaining bundled service, direct access, and community choice aggregation customers and ensures that no costs are shifted from participating customers to nonparticipating ratepayers.
A participating utility shall track and account for all revenues and costs to ensure that the utility recovers the actual costs of the utility’s green tariff shared renewables program and that all costs and revenues are fully transparent and auditable.
Any renewable energy credits associated with electricity procured by a participating utility for the utility’s green tariff shared renewables program and used by a participating customer shall be retired by the participating utility on behalf of the participating customer. Those renewable energy credits shall not be further sold, transferred, or otherwise monetized for any purpose. Any renewable energy credits associated with electricity procured by a participating utility for the green tariff shared renewables program, but not used by a participating customer, shall be counted toward meeting that participating utility’s renewables portfolio standard.
A participating utility shall, in the event of participant customer attrition or other causes that reduce customer participation or electrical demand below generation levels, apply the excess generation from the eligible renewable energy resources procured through the utility’s green tariff shared renewables program to the utility’s renewable portfolio standard procurement obligations or bank the excess generation for future use to benefit all customers in accordance with the renewables portfolio standard banking and procurement rules approved by the commission.
In calculating its procurement requirements to meet the requirements of the California Renewables Portfolio Standard Program (Article 16 (commencing with Section 399.11) of Chapter 2.3 of Part 1), a participating utility may exclude from total retail sales the kilowatthours generated by an eligible renewable energy resource that is credited to a participating customer pursuant to the utility’s green tariff shared renewables program, commencing with the point in time at which the generating facility achieves commercial operation.
All renewable energy resources procured on behalf of participating customers in the participating utility’s green tariff shared renewables program shall comply with the State Air Resources Board’s Voluntary Renewable Electricity Program. California-eligible greenhouse gas allowances associated with these purchases shall be retired on behalf of participating customers as part of the board’s Voluntary Renewable Electricity Program.
A participating utility shall provide a municipality with aggregated consumption data for participating customers within the municipality’s jurisdiction to allow for reporting on progress toward climate action goals by the municipality. A participating utility shall also publicly disclose, on a geographic basis, consumption data and reductions in emissions of greenhouse gases achieved by participating customers in the utility’s green tariff shared renewables program, on an aggregated basis consistent with privacy protections as specified in Chapter 5 (commencing with Section 8380) of Division 4.1.
This section does not prohibit or restrict a community choice aggregator from offering its own voluntary renewable energy programs to participating customers of the community choice aggregation.
CHAPTER 7.7. Energy Storage Systems [2835. - 2839.]
For purposes of this chapter, the following terms have the following meanings:
“Energy storage system” means commercially available technology that is capable of absorbing energy, storing it for a period of time, and thereafter dispatching the energy. An “energy storage system” may have any of the characteristics in paragraph (2), shall accomplish one of the purposes in paragraph (3), and shall meet at least one of the characteristics in paragraph (4).
An “energy storage system” may have any of the following characteristics:
Be either centralized or distributed.
Be either owned by a load-serving entity or local publicly owned electric utility, a customer of a load-serving entity or local publicly owned electric utility, or a third party, or is jointly owned by two or more of the above.
An “energy storage system” shall be cost effective and either reduce emissions of greenhouse gases, reduce demand for peak electrical generation, defer or substitute for an investment in generation, transmission, or distribution assets, or improve the reliable operation of the electrical transmission or distribution grid.
An “energy storage system” shall do one or more of the following:
Use mechanical, chemical, or thermal processes to store energy that was generated at one time for use at a later time.
Store thermal energy for direct use for heating or cooling at a later time in a manner that avoids the need to use electricity at that later time.
Use mechanical, chemical, or thermal processes to store energy generated from renewable resources for use at a later time.
Use mechanical, chemical, or thermal processes to store energy generated from mechanical processes that would otherwise be wasted for delivery at a later time.
“Load-serving entity” has the same meaning as defined in Section 380.
“New” means, in reference to an energy storage system, a system that is installed and first becomes operational after January 1, 2010.
“Offpeak” means, in reference to electrical demand, a period that is not within a peak demand period.
“Peak demand period” means a period of high daily, weekly, or seasonal demand for electricity. For purposes of this chapter, the peak demand period for a load-serving entity shall be determined, or approved, by the commission and shall be determined, or approved, for a local publicly owned electric utility, by its governing body.
“Procure” and “procurement” means, in reference to the procurement of an energy storage system, to acquire by ownership or by a contractual right to use the energy from, or the capacity of, including ancillary services, an energy storage system owned by a load-serving entity, local publicly owned electric utility, customer, or third party. Nothing in this chapter, and no action by the commission, shall discourage or disadvantage development and ownership of an energy storage system by an electrical corporation.
On or before March 1, 2012, the commission shall open a proceeding to determine appropriate targets, if any, for each load-serving entity to procure viable and cost-effective energy storage systems to be achieved by December 31, 2015, and December 31, 2020. As part of this proceeding, the commission may consider a variety of possible policies to encourage the cost-effective deployment of energy storage systems, including refinement of existing procurement methods to properly value energy storage systems.
The commission shall adopt the procurement targets, if determined to be appropriate pursuant to paragraph (1), by October 1, 2013.
The commission shall reevaluate the determinations made pursuant to this subdivision not less than once every three years.
Nothing in this section prohibits the commission’s evaluation and approval of any application for funding or recovery of costs of any ongoing or new development, trialing, and testing of energy storage projects or technologies outside of the proceeding required by this chapter.
On or before March 1, 2012, the governing board of each local publicly owned electric utility shall initiate a process to determine appropriate targets, if any, for the utility to procure viable and cost-effective energy storage systems to be achieved by December 31, 2016, and December 31, 2020. As part of this proceeding, the governing board may consider a variety of possible policies to encourage the cost-effective deployment of energy storage systems, including refinement of existing procurement methods to properly value energy storage systems.
The governing board shall adopt the procurement targets, if determined to be appropriate pursuant to paragraph (1), by October 1, 2014.
The governing board shall reevaluate the determinations made pursuant to this subdivision not less than once every three years.
In adopting and reevaluating appropriate energy storage system procurement targets and policies pursuant to subdivision (a) of Section 2836, the commission shall do all of the following:
Consider existing operational data and results of testing and trial pilot projects from existing energy storage facilities.
Consider available information from the California Independent System Operator derived from California Independent System Operator testing and evaluation procedures.
Consider the integration of energy storage technologies with other programs, including demand-side management or other means of achieving the purposes identified in Section 2837 that will result in the most efficient use of generation resources and cost-effective energy efficient grid integration and management.
Ensure that the energy storage system procurement targets and policies that are established are technologically viable and cost effective.
An energy storage system may be used to meet the resource adequacy requirements established for a load-serving entity pursuant to Section 380 if it meets applicable standards.
An energy storage system may be used to meet the resource adequacy requirements established by a local publicly owned electric utility pursuant to Section 9620 if it meets applicable standards.
All procurement of energy storage systems by a load-serving entity or local publicly owned electric utility shall be cost effective.
By June 1, 2018, all of the following shall occur:
The Los Angeles Department of Water and Power shall, in coordination with the city council of the City of Los Angeles, if it chooses to participate, determine the cost-effectiveness and feasibility of deploying, on an expedited basis, a minimum aggregate total of 100 megawatts of cost-effective energy storage solutions to help address the Los Angeles Basin’s electrical system operational limitations resulting from reduced gas deliverability from the Aliso Canyon natural gas storage facility.
If the Los Angeles Department of Water and Power determines pursuant to paragraph (1) that deploying the cost-effective energy storage solutions, as described in paragraph (1), is cost effective and feasible, it shall consider deploying those cost-effective energy storage solutions after June 1, 2018.
The commission shall, to the extent that doing so is cost effective and feasible and necessary to meet the reliability requirements of the electrical system in the Los Angeles Basin, direct an electrical corporation serving the Los Angeles Basin to deploy, pursuant to a competitive solicitation, a minimum aggregate total of 20 megawatts of cost-effective energy storage solutions to help address the Los Angeles Basin’s electrical system operational limitations resulting from reduced gas deliverability from the Aliso Canyon natural gas storage facility. An electrical corporation may count any cost-effective energy storage solution that it deploys pursuant to this subdivision towards the capacity requirement established pursuant to Section 2838.2 if the cost-effective storage solution that it deploys is a distributed energy storage system, as defined in subdivision (a) of Section 2838.2.
It is the intent of the Legislature that the commission and all public utilities having jurisdiction affected by this section or by actions taken pursuant to this section shall take immediate actions to support rapid compliance with this section, including by allowing or developing fast-tracked permitting, interconnection studies, and interconnection processes, and through rule waivers or adjustments if appropriate, to support rapid or more rapid site acquisition for energy storage project developments and customer acquisition of energy storage solutions. This paragraph is not intended to in any way modify the obligations of the commission or a public utility under the California Environmental Quality Act (Division 13 (commencing with Section 21000) of the Public Resources Code).
It is the intent of the Legislature that local governments having jurisdiction affected by this section or by actions taken pursuant to this section strongly consider taking immediate actions to support rapid compliance with this section, including by allowing or developing fast-tracked permitting and waiving or adjusting procedural requirements, to support rapid or more rapid site acquisition for energy storage project developments and customer acquisition of energy storage solutions. This paragraph is not intended to in any way modify the obligations of a local government under the California Environmental Quality Act (Division 13 (commencing with Section 21000) of the Public Resources Code).
For purposes of this section, the following terms have the following meanings:
“Los Angeles Basin” means the area identified as the “Aliso Canyon Delivery Area” on page 11 of the Aliso Canyon Risk Assessment Technical Report, dated April 5, 2016.
Each electrical corporation’s renewable energy procurement plan, prepared and approved pursuant to Article 16 (commencing with Section 399.11) of Chapter 2.3 of Part 1, shall require the utility to procure new energy storage systems that are appropriate to allow the electrical corporation to comply with the energy storage system procurement targets and policies adopted pursuant to Section 2836. The plan shall address the acquisition and use of energy storage systems in order to achieve the following purposes:
Integrate intermittent generation from eligible renewable energy resources into the reliable operation of the transmission and distribution grid.
Allow intermittent generation from eligible renewable energy resources to operate at or near full capacity.
Reduce the need for new fossil-fuel powered peaking generation facilities by using stored electricity to meet peak demand.
Reduce purchases of electricity generation sources with higher emissions of greenhouse gases.
Eliminate or reduce transmission and distribution losses, including increased losses during periods of congestion on the grid.
Reduce the demand for electricity during peak periods and achieve permanent load-shifting by using thermal storage to meet air-conditioning needs.
Avoid or delay investments in transmission and distribution system upgrades.
Use energy storage systems to provide the ancillary services otherwise provided by fossil-fueled generating facilities.
By January 1, 2016, each load-serving entity shall submit a report to the commission demonstrating that it has complied with the energy storage system procurement targets and policies adopted by the commission pursuant to subdivision (a) of Section 2836.
By January 1, 2021, each load-serving entity shall submit a report to the commission demonstrating that it has complied with the energy storage system procurement targets and policies adopted by the commission pursuant to subdivision (a) of Section 2836.
The commission shall ensure that a copy of each report required by subdivision (a), with any confidential information redacted, is available on the commission’s Internet Web site.
The following definitions apply to this section:
“Distributed energy storage system” means an energy storage system with a useful life of at least 10 years that is connected to the distribution system or is located on the customer side of the meter.
“Energy storage management system” means a system by which an electrical corporation can manage the charging and discharging of the distributed energy storage system in a manner that provides benefits to ratepayers.
The commission, in consultation with the State Air Resources Board and the Energy Commission, shall direct the state’s three largest electrical corporations to file applications for programs and investments to accelerate widespread deployment of distributed energy storage systems to achieve ratepayer benefits, reduce dependence on petroleum, meet air quality standards, and reduce emissions of greenhouse gases. Programs and investments proposed by the state’s three largest electrical corporations shall seek to minimize overall costs and maximize overall benefits.
The commission may approve, or modify and approve, programs and investments of an electrical corporation in distributed energy storage systems with appropriate energy storage management systems and reasonable mechanisms for cost recovery, if they are consistent with the requirements of this section and do not unreasonably limit or impair the ability of nonutility enterprises to market and deploy energy storage systems. The total capacity of the programs and investments in distributed energy storage systems approved by the commission pursuant to this section shall not exceed 500 megawatts, divided equally among the state’s three largest electrical corporations.
No more than 25 percent of the capacity of distributed energy storage systems approved for programs and investments pursuant to this section shall be provided by behind-the-meter systems.
The capacity authorized pursuant to paragraph (1) is in addition to any investments authorized pursuant to Section 2836.
It is the intent of the Legislature that the commission, in authorizing an electrical corporation to recover the costs of approved energy storage programs and investments from all customers pursuant to Section 2838.2, shall ensure that the costs for the programs and investments are recovered in proportion to the benefits received, consistent with Section 451.
Notwithstanding any provision of this chapter, the requirements of this chapter do not apply to either of the following:
An electrical corporation that has 60,000 or fewer customer accounts within California.
A public utility district that receives all of its electricity pursuant to a preference right adopted and authorized by the United States Congress pursuant to Section 4 of the Trinity River Division Act of August 12, 1955 (Public Law 84-386).
The commission does not have authority or jurisdiction to enforce any of the requirements of this chapter against a local publicly owned electric utility.
CHAPTER 8. Energy Efficiency Systems [2840. - 2843.]
ARTICLE 1. Waste Heat and Carbon Emissions Reduction Act [2840. - 2843.]
This article shall be known and may be cited as the Waste Heat and Carbon Emissions Reduction Act.
For purposes of this article, the following terms have the following meanings:
“Combined heat and power system” means a system that produces both electricity and thermal energy for heating or cooling from a single fuel input that meets all of the following:
Is interconnected to, and operates in parallel with, the electrical transmission and distribution grid.
Is sized to meet the eligible customer-generator’s onsite thermal demand.
Meets the efficiency standards of subdivisions (a) and (d) of, and the greenhouse gases emissions performance standard of subdivision (f) of, Section 2843.
“Eligible customer-generator” means a customer of an electrical corporation that meets both of the following requirements:
Uses a combined heat and power system with a generating capacity of not more than 20 megawatts, that first commences operation on or after January 1, 2008.
Uses a time-of-use meter capable of registering the flow of electricity in two directions. If the existing electrical meter of an eligible customer-generator is not capable of measuring the flow of electricity in two directions, the eligible customer-generator shall be responsible for all expenses involved in purchasing and installing a meter that is able to measure electricity flow in two directions. If an additional meter or meters are installed, the electricity flow calculations shall yield a result identical to that of a time-of-use meter.
“Excess electricity” means the net electricity exported to the electrical grid, generated by a combined heat and power system that is in compliance with Section 2843.
“Greenhouse gas” or “greenhouse gases” includes all of the following gases: carbon dioxide, methane, nitrous oxide, hydrofluorocarbons, perfluorocarbons, and sulfur hexafluoride.
The Legislature finds and declares all of the following:
Combined heat and power systems produce both electricity and thermal energy from a single fuel input, thus achieving much greater efficiency than the usual separate systems for producing these forms of energy, and reducing consumption of fuel.
Combined heat and power systems recover heat that would otherwise be wasted in separate energy applications, and use this heat to avoid consumption of fuel that would otherwise be required to produce heat.
Gigawatthours of potential useful electricity and millions of British thermal units of thermal energy could be derived from unused waste heat that is currently being vented into the atmosphere.
It is the intent of the Legislature that state policies dramatically advance the efficiency of the state’s use of natural gas by capturing unused waste heat, and in so doing, help offset the growing crisis in electricity supply and transmission congestion in the state.
It is the intent of the Legislature to reduce wasteful consumption of energy through improved residential, commercial, institutional, industrial, and manufacturer utilization of waste heat whenever it is cost effective, technologically feasible, and environmentally beneficial, particularly when this reduces emissions of carbon dioxide and other carbon-based greenhouse gases.
It is the intent of the Legislature to support and facilitate both customer- and utility-owned combined heat and power systems.
This article does not apply to, and shall not impact, combined heat and power systems in operation prior to January 1, 2008, or combined heat and power systems with a generating capacity greater than 20 megawatts.
The commission may require an electrical corporation to purchase from an eligible customer-generator, excess electricity that is delivered to the grid that is generated by a combined heat and power system that is in compliance with Section 2843. The commission may establish a maximum kilowatthours limitation on the amount of excess electricity that an electrical corporation is required to purchase if the commission finds that the anticipated excess electricity generated has an adverse effect on long-term resource planning or reliable operation of the grid. The commission shall establish, in consultation with the Independent System Operator, tariff provisions that facilitate both the provisions of this chapter and the reliable operation of the grid.
Every electrical corporation shall file with the commission a standard tariff for the purchase of excess electricity from an eligible customer-generator.
The tariff shall provide for payment for every kilowatthour delivered to the electrical grid by the combined heat and power system at a price determined by the commission.
The tariff shall include flexible rates with options for different durations, not to exceed 10 years, and fixed or variable rates relative to the cost of natural gas.
The commission shall ensure that ratepayers not utilizing combined heat and power systems are held indifferent to the existence of this tariff.
The commission, in reviewing the tariff filed by an electrical corporation, shall establish time-of-delivery rates that encourage demand management and net generation of electricity during periods of peak system demand.
Every electrical corporation shall make the tariff available to eligible customer-generators that own, or lease, and operate a combined heat and power system within the service territory of the electrical corporation, upon request. An electrical corporation may make the terms of the tariff available to an eligible customer in the form of a standard contract.
The costs and benefits associated with any tariff or contract entered into by an electrical corporation pursuant to this section shall be allocated to all benefiting customers. For purposes of this section “benefiting customers” may, as determined by the commission, include bundled service customers of the electrical corporation, customers of the electrical corporation that receive their electric service through a direct transaction, as defined in subdivision (c) of Section 331, and customers of an electrical corporation that receive their electric service from a community choice aggregator, as defined in Section 331.1.
The physical generating capacity of the combined heat and power system shall count toward the resource adequacy requirements of load-serving entities for purposes of Section 380.
The commission shall adopt or maintain standby rates or charges for combined heat and power systems that are based only upon assumptions that are supported by factual data, and shall exclude any assumptions that forced outages or other reductions in electricity generation by combined heat and power systems will occur simultaneously on multiple systems, or during periods of peak electrical system demand, or both.
The commission may modify or adjust the requirements of this article for any electrical corporation with less than 100,000 service connections, as individual circumstances merit.
A local publicly owned electric utility serving retail end-use customers shall establish a program that does both of the following:
Allows retail end-use customers to utilize combined heat and power systems that reduce emissions of greenhouse gases by achieving improved efficiencies utilizing heat that would otherwise be wasted in separate energy applications.
Provides a market for the purchase of excess electricity generated by a combined heat and power system, at a just and reasonable rate, to be determined by the governing body of the utility.
The commission, in approving a procurement plan for an electrical corporation pursuant to Section 454.5, shall require that the electrical corporation’s procurement plan incorporate combined heat and power solutions to the extent that it is cost effective compared to other competing forms of wholesale generation, technologically feasible, and environmentally beneficial, particularly as it pertains to reducing emissions of carbon dioxide and other greenhouse gases.
The commission shall ensure that an electrical corporation utilizes long-term planning and a reliability assessment for upgrades to its transmission and distribution systems and that any upgrades are not inconsistent with promoting combined heat and power systems that are cost effective, technologically feasible, and environmentally beneficial, particularly as those combined heat and power systems reduce emissions of greenhouse gases.
The commission shall, for each electrical corporation, establish a pay-as-you-save pilot program for eligible customers.
For the purposes of this section, an “eligible customer” means a customer of an electrical corporation that meets the following criteria:
The customer uses a combined heat and power system with a generating capacity of not more than 20 megawatts that is in compliance with Section 2843.
The customer is any of the following:
A nonprofit organization described in Section 501(c) (3) of the Internal Revenue Code (26 U.S.C. Sec. 501(c) (3)), that is exempt from taxation under Section 501(a) of that code (26 U.S.C. Sec. 501(a)).
A federal, state, or local government facility.
The pilot program shall enable an eligible customer to finance all of the upfront costs for the purchase and installation of a combined heat and power system by repaying those costs over time through on-bill financing at the difference between what an eligible customer would have paid for electricity and the actual savings derived for a period of up to 10 years.
The commission shall ensure that the reasonable costs of the electrical corporation associated with the pilot program are recovered.
All costs of the pay-as-you-save program or financing mechanisms shall be borne solely by the combined heat and power generators that use the program or financing mechanisms, and the commission shall ensure that the costs of the program are not shifted to the other customers or classes of customers of the electrical corporation.
Each electric corporation shall make on-bill financing available to eligible customers until the statewide cumulative rated generating capacity from pilot program combined heat and power systems in the service territories of the three largest electrical corporations in the state reaches 100 megawatts. An electrical corporation shall only be required to participate in the pilot program until it meets its proportionate share of the 100-megawatt limitation, based on the percentage of its peak demand to the total statewide peak demand within the service territories of all electrical corporations.
An approval made by the Department of Finance for a state agency to purchase, lease, or otherwise acquire a combined heat and power facility that would be financed through the pay-as-you-save pilot program, may not be made sooner than 30 days after written notification thereof is provided to the Chairperson of the Senate Committee on Budget and Fiscal Review, the Chairperson of the Assembly Committee on Budget, and the Chairperson of the Joint Legislative Budget Committee, or not sooner than whatever lesser time the Chairperson of the Joint Legislative Budget Committee may determine.
The Energy Commission shall, by January 1, 2010, adopt guidelines that combined heat and power systems subject to this chapter shall meet, and shall accomplish all of the following:
Reduce waste energy.
Be sized to meet the eligible customer-generator’s thermal load.
Operate continuously in a manner that meets the expected thermal load and optimizes the efficient use of waste heat.
Are cost effective, technologically feasible, and environmentally beneficial.
It is the intent of the Legislature that the guidelines do not permit customers to operate as de facto wholesale generators with guaranteed purchasers for their electricity.
Notwithstanding any other provisions of law, the guidelines required by this section shall be exempt from the requirements of Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code. The guidelines shall be adopted at a publicly noticed meeting offering all interested parties an opportunity to comment. At least 30 days’ public notice shall be given of the meeting required by this section, before the Energy Commission initially adopts guidelines. Substantive changes to the guidelines shall not be adopted without at least 10 days’ written notice to the public.
Prior to January 1, 2010, the Energy Commission may adopt temporary guidelines for combined heat and power systems that comply with the parameters set forth in subdivision (a).
An eligible customer-generator’s combined heat and power system shall meet an oxides of nitrogen (NOx) emissions rate standard of 0.07 pounds per megawatthour and a minimum efficiency of 60 percent. A minimum efficiency of 60 percent shall be measured as useful energy output divided by fuel input. The efficiency determination shall be based on 100-percent load.
An eligible customer-generator’s combined heat and power system that meets the 60-percent efficiency standard may take a credit to meet the applicable NOx emissions standard of 0.07 pounds per megawatthour. Credit shall be at the rate of one megawatthour for each 3.4 million British thermal units of heat recovered.
An eligible customer-generator’s combined heat and power system shall comply with the greenhouse gases emission performance standard established by the commission pursuant to Section 8341.
An eligible customer-generator shall adequately maintain and service the combined heat and power system so that during operation, the system continues to meet or exceed the efficiency and emissions standards established pursuant to subdivisions (a), (d), and (f).
CHAPTER 9. Solar Energy Systems [2851. - 2869.]
ARTICLE 1. Solar Energy Systems [2851. - 2854.6.]
In implementing the California Solar Initiative, the commission shall do all of the following:
The commission shall authorize the award of monetary incentives for up to the first megawatt of alternating current generated by solar energy systems that meet the eligibility criteria established by the Energy Commission pursuant to Chapter 8.8 (commencing with Section 25780) of Division 15 of the Public Resources Code. The commission shall determine the eligibility of a solar energy system, as defined in Section 25781 of the Public Resources Code, to receive monetary incentives until the time the Energy Commission establishes eligibility criteria pursuant to Section 25782. Monetary incentives shall not be awarded for solar energy systems that do not meet the eligibility criteria. The incentive level authorized by the commission shall decline each year following implementation of the California Solar Initiative, at a rate of no less than an average of 7 percent per year, and, except as provided in subparagraph (B), shall be zero as of December 31, 2016. The commission shall adopt and publish a schedule of declining incentive levels no less than 30 days in advance of the first decline in incentive levels. The commission may develop incentives based upon the output of electricity from the system, provided those incentives are consistent with the declining incentive levels of this paragraph and the incentives apply to only the first megawatt of electricity generated by the system.
The incentive level for the installation of a solar energy system pursuant to Section 2852 shall be zero as of December 31, 2021.
The commission shall adopt a performance-based incentive program so that by January 1, 2008, 100 percent of incentives for solar energy systems of 100 kilowatts or greater and at least 50 percent of incentives for solar energy systems of 30 kilowatts or greater are earned based on the actual electrical output of the solar energy systems. The commission shall encourage, and may require, performance-based incentives for solar energy systems of less than 30 kilowatts. Performance-based incentives shall decline at a rate of no less than an average of 7 percent per year. In developing the performance-based incentives, the commission may:
Apply performance-based incentives only to customer classes designated by the commission.
Design the performance-based incentives so that customers may receive a higher level of incentives than under incentives based on installed electrical capacity.
Develop financing options that help offset the installation costs of the solar energy system, provided that this financing is ultimately repaid in full by the consumer or through the application of the performance-based rebates.
By January 1, 2008, the commission, in consultation with the Energy Commission, shall require reasonable and cost-effective energy efficiency improvements in existing buildings as a condition of providing incentives for eligible solar energy systems, with appropriate exemptions or limitations to accommodate the limited financial resources of low-income residential housing.
Notwithstanding subdivision (g) of Section 2827, the commission may develop a time-variant tariff that creates the maximum incentive for ratepayers to install solar energy systems so that the system’s peak electricity production coincides with California’s peak electricity demands and that ensures that ratepayers receive due value for their contribution to the purchase of solar energy systems and customers with solar energy systems continue to have an incentive to use electricity efficiently. In developing the time-variant tariff, the commission may exclude customers participating in the tariff from the rate cap for residential customers for existing baseline quantities or usage by those customers of up to 130 percent of existing baseline quantities, as required by Section 739.9. Nothing in this paragraph authorizes the commission to require time-variant pricing for ratepayers without a solar energy system.
Notwithstanding subdivision (a), in implementing the California Solar Initiative, the commission may authorize the award of monetary incentives for solar thermal and solar water heating devices, in a total amount up to one hundred million eight hundred thousand dollars ($100,800,000).
In implementing the California Solar Initiative, the commission shall not allocate more than fifty million dollars ($50,000,000) to research, development, and demonstration that explores solar technologies and other distributed generation technologies that employ or could employ solar energy for generation or storage of electricity or to offset natural gas usage. Any program that allocates additional moneys to research, development, and demonstration shall be developed in collaboration with the Energy Commission to ensure there is no duplication of efforts, and adopted by the commission through a rulemaking or other appropriate public proceeding. Any grant awarded by the commission for research, development, and demonstration shall be approved by the full commission at a public meeting. This subdivision does not prohibit the commission from continuing to allocate moneys to research, development, and demonstration pursuant to the self-generation incentive program for distributed generation resources originally established pursuant to Chapter 329 of the Statutes of 2000, as modified pursuant to Section 379.6.
The Legislature finds and declares that a program that provides a stable source of monetary incentives for eligible solar energy systems will encourage private investment sufficient to make solar technologies cost effective.
The costs of the program adopted and implemented pursuant to this section shall not be recovered from customers participating in the California Alternate Rates for Energy or CARE program established pursuant to Section 739.1, except to the extent that program costs are recovered out of the nonbypassable system benefits charge authorized pursuant to Section 399.8.
Except as provided in subdivision (f), in implementing the California Solar Initiative, the commission shall ensure that the total cost over the duration of the program does not exceed three billion five hundred fifty million eight hundred thousand dollars ($3,550,800,000). Except as provided in subdivision (f), financial components of the California Solar Initiative shall consist of the following:
Programs under the supervision of the commission funded by charges collected from customers of San Diego Gas and Electric Company, Southern California Edison Company, and Pacific Gas and Electric Company. Except as provided in subdivision (f), the total cost over the duration of these programs shall not exceed two billion three hundred sixty-six million eight hundred thousand dollars ($2,366,800,000) and includes moneys collected directly into a tracking account for support of the California Solar Initiative.
Programs adopted, implemented, and financed in the amount of seven hundred eighty-four million dollars ($784,000,000), by charges collected by local publicly owned electric utilities pursuant to Section 2854. Nothing in this subdivision shall give the commission power and jurisdiction with respect to a local publicly owned electric utility or its customers.
Programs for the installation of solar energy systems on new construction (New Solar Homes Partnership Program), administered by the Energy Commission, and funded by charges in the amount of four hundred million dollars ($400,000,000), collected from customers of San Diego Gas and Electric Company, Southern California Edison Company, and Pacific Gas and Electric Company. If the commission is notified by the Energy Commission that funding available pursuant to Section 25751 of the Public Resources Code for the New Solar Homes Partnership Program and any other funding for the purposes of this paragraph have been exhausted, the commission may require an electrical corporation to continue administration of the program pursuant to the guidelines established for the program by the Energy Commission, until the funding limit authorized by this paragraph has been reached. The commission may determine whether a third party, including the Energy Commission, should administer the utility’s continuation of the New Solar Homes Partnership Program. The commission, in consultation with the Energy Commission, shall supervise the administration of the continuation of the New Solar Homes Partnership Program by an electrical corporation or third-party administrator. After the exhaustion of funds, the Energy Commission shall notify the Joint Legislative Budget Committee 30 days prior to the continuation of the program. This subparagraph shall become inoperative on June 1, 2018.
If the commission requires a continuation of the program pursuant to subparagraph (A), any funding made available pursuant to the continuation program shall be encumbered through the issuance of rebate reservations by no later than June 1, 2018, and disbursed by no later than December 31, 2021.
The changes made to this subdivision by Chapter 39 of the Statutes of 2012 do not authorize the levy of a charge or any increase in the amount collected pursuant to any existing charge, nor do the changes add to, or detract from, the commission’s existing authority to levy or increase charges.
Upon the expenditure or reservation in any electrical corporation’s service territory of the amount specified in paragraph (1) of subdivision (e) for low-income residential housing programs pursuant to subdivision (c) of Section 2852, the commission shall authorize the continued collection of the charge for the purposes of Section 2852. The commission shall ensure that the total amount collected pursuant to this subdivision does not exceed one hundred eight million dollars ($108,000,000). Upon approval by the commission, an electrical corporation may use amounts collected pursuant to subdivision (e) for purposes of funding the general market portion of the California Solar Initiative, that remain unspent and unencumbered after December 31, 2016, to reduce the electrical corporation’s portion of the total amount collected pursuant to this subdivision.
As used in this section,“discount rate” means a financial mechanism that provides a given amount of interest as an offset to the loss of the time value of money on solar projects that receive performance-based incentives under Section 2851.
Before collecting additional ratepayer funds to fund program shortfalls identified for incentive step levels 8, 9, and 10 for nonresidential solar photovoltaic systems, the commission shall first allocate interest accumulated from customer collections and, for the remainder of the shortfall, increase collections from customers of San Diego Gas and Electric Company, Southern California Edison Company, and Pacific Gas and Electric Company for programs described in paragraph (1) of subdivision (e) of Section 2851.
The discount rate shall be set at 4 percent, unless the commission determines the rate should be reduced.
A school district or community college district may request an extension of a reservation expiration date for monetary incentives for a solar energy system. The commission may grant a maximum of three extensions of 180 calendar days for each extension.
An extension request pursuant to subdivision (a) shall be made in writing, submitted to the program administrators, and shall include a written explanation of the need for the extension and the amount of additional time needed. In describing the need for the time extension request, the school district or community college district shall provide information on the circumstances, that are beyond the control of the district, that prevent the solar energy system from being installed as previously described in the initial reservation request. A failure to submit the incentive claim form package by the original or extended reservation expiration date shall result in the cancellation of the request.
An approval of a request for a change in the reservation expiration date for monetary incentives for a solar energy system shall not modify any other condition of a reservation for incentives.
As used in this section, the following terms have the following meanings:
“Affordable housing cost,” “affordable rent,” and “lower income households” have the same meanings as in those set forth in Chapter 2 (commencing with Section 50050) of Part 1 of Division 31 of the Health and Safety Code.
“California Solar Initiative” means the program providing ratepayer-funded incentives for eligible solar energy systems adopted by the Public Utilities Commission in Decision 05-12-044 and Decision 06-01-024.
“Low-income residential housing” means any of the following:
A multifamily residential complex financed with low-income housing tax credits, tax-exempt mortgage revenue bonds, general obligation bonds, or local, state, or federal loans or grants, and for which either of the following applies:
The rents of the occupants who are lower income households do not exceed those prescribed by deed restrictions or regulatory agreements pursuant to the terms of the financing or financial assistance.
The affordable units have been or will be initially sold at an affordable housing cost to a lower income household and those units are subject to a resale restriction or equity sharing agreement pursuant to the terms of the financing or financial assistance.
A multifamily residential complex in which at least 20 percent of the total housing units are sold or rented to lower income households and either of the following applies:
The rental housing units targeted for lower income households are subject to a deed restriction or affordability covenant with a public entity or nonprofit housing provider organized under Section 501(c)(3) of the Internal Revenue Code that has as its stated purpose in its articles of incorporation on file with the office of the Secretary of State to provide affordable housing to lower income households that ensures that the units will be available at an affordable rent for a period of at least 30 years.
The housing units have been or will be initially sold at an affordable cost to a lower income household and those units are subject to a resale restriction or equity sharing agreement, for which the homeowner does not receive a greater share of equity than described in paragraph (2) of subdivision (c) of Section 65915 of the Government Code, with a public entity or nonprofit housing provider organized under Section 501(c)(3) of the Internal Revenue Code that has as its stated purpose in its articles of incorporation on file with the office of the Secretary of State to provide affordable housing to lower income households.
An individual residence sold at an affordable housing cost to a lower income household that is subject to a resale restriction or equity sharing agreement, for which the homeowner does not receive a greater share of equity than described in paragraph (2) of subdivision (c) of Section 65915 of the Government Code, with a public entity or nonprofit housing provider organized under Section 501(c)(3) of the Internal Revenue Code that has as its stated purpose in its articles of incorporation on file with the office of the Secretary of State to provide affordable housing to lower income households.
“Solar energy system” means a solar energy device that has the primary purpose of providing for the collection and distribution of solar energy for the generation of electricity, that produces at least one kilowatt, and produces not more than five megawatts, alternating current rated peak electricity, and that meets or exceeds the eligibility criteria established by the commission or the Energy Commission.
In establishing the California Solar Initiative, no moneys shall be diverted from any existing programs for low-income ratepayers, or from cost-effective energy efficiency or demand response programs.
The commission shall ensure that not less than 10 percent of the funds for the California Solar Initiative, as specified in subdivision (e) of, or moneys collected pursuant to subdivision (f) of, Section 2851, are utilized for the installation of solar energy systems on low-income residential housing. Notwithstanding any other law, the commission may modify the monetary incentives made available pursuant to the California Solar Initiative to accommodate the limited financial resources of low-income residential housing.
The commission may incorporate a revolving loan or loan guarantee program into the California Solar Initiative for low-income residential housing. All loans outstanding as of January 1, 2022, shall continue to be repaid consistent with the terms and conditions of the program adopted and implemented by the commission pursuant to this subdivision, until repaid in full.
All moneys set aside for the purpose of funding the installation of solar energy systems on low-income residential housing that are unexpended and unencumbered on January 1, 2022, and all moneys thereafter repaid pursuant to paragraph (2), except to the extent those moneys are encumbered pursuant to this section, shall be utilized to augment existing cost-effective energy efficiency measures in low-income residential housing that benefit ratepayers.
In supervising a program implementing the California Solar Initiative pursuant to this section, the commission shall ensure that the program does all of the following:
In order to further the state goal of encouraging the installation of 3,000 megawatts of photovoltaic solar energy in California within 10 years, the governing body of a local publicly owned electric utility that sells electricity at retail, shall adopt, implement, and finance a solar initiative program, funded in accordance with subdivision (b), for the purpose of investing in, and encouraging the increased installation of, residential and commercial solar energy systems.
On or before January 1, 2008, a local publicly owned electric utility shall offer monetary incentives for the installation of solar energy systems of at least two dollars and eighty cents ($2.80) per installed watt, or for the electricity produced by the solar energy system, measured in kilowatthours, as determined by the governing board of a local publicly owned electric utility, for photovoltaic solar energy systems. The incentive level shall decline each year thereafter at a rate of no less than an average of 7 percent per year.
A local publicly owned electric utility shall initiate a public proceeding to fund a solar energy program to adequately support the goal of installing 3,000 megawatts of photovoltaic solar energy in California. The proceeding shall determine what additional funding, if any, is necessary to provide the incentives pursuant to subdivision (b). The public proceeding shall be completed and the comprehensive solar energy program established by January 1, 2008.
The solar energy program of a local publicly owned electric utility shall be consistent with all of the following:
That a solar energy system receiving monetary incentives comply with the eligibility criteria, design, installation, and electrical output standards or incentives established by the Energy Commission pursuant to Section 25782 of the Public Resources Code.
That solar energy systems receiving monetary incentives are intended primarily to offset part or all of the consumer’s own electricity demand.
That all components in the solar energy system are new and unused, and have not previously been placed in service in any other location or for any other application.
That the solar energy system has a warranty of not less than 10 years to protect against defects and undue degradation of electrical generation output.
That the solar energy system be located on the same premises of the end-use consumer where the consumer’s own electricity demand is located.
That the solar energy system be connected to the local publicly owned electric utility’s electrical distribution system within the state.
That the solar energy system has meters or other devices in place to monitor and measure the system’s performance and the quantity of electricity generated by the system.
That the solar energy system be installed in conformance with the manufacturer’s specifications and in compliance with all applicable electrical and building code standards.
In establishing the program required by this section, no moneys shall be diverted from any existing programs for low-income ratepayers, or from cost-effective energy efficiency or demand response programs.
The statewide expenditures for solar programs adopted, implemented, and financed by local publicly owned electric utilities shall be seven hundred eighty-four million dollars ($784,000,000). The expenditure level for each local publicly owned electric utility shall be based on that utility’s percentage of the total statewide load served by all local publicly owned electric utilities. Expenditures by a local publicly owned electric utility may be less than the utility’s cap amount, provided that funding is adequate to provide the incentives required by subdivisions (a) and (b).
Notwithstanding paragraphs (2) and (5) of subdivision (d) of Section 2854, a local publicly owned electric utility may adopt, implement, and finance a solar initiative program otherwise in accordance with that section, using monetary incentives authorized by subdivision (b) of Section 2854, to residential and business consumers where consumers offset part or all of their electricity demand with electricity generated by a solar energy system not located on the premises of the consumer, if all of the following requirements are met:
The solar energy system meets all of the following conditions:
It is located within the service territory of the local publicly owned electric utility.
It has a capacity of no more than five megawatts.
It is interconnected to the local publicly owned electric utility’s system at the distribution level.
The local publicly owned electric utility meets all of the following conditions:
It provides monetary incentives authorized by Section 2854 for not more than the first megawatt of generating capacity of each solar energy system.
It has contracted to purchase the total electricity produced by the solar energy system or owns the solar energy system.
It provides no greater incentive per watt for the solar energy system than provided for by systems that participate in the applicable solar initiative program established under Section 2854.
It has received approval for the solar energy system from its governing board at a publicly noticed and held meeting.
The total megawatt capacity of solar energy systems eligible for a local publicly owned electric utility program under this section is both of the following:
On or before July 1, 2019, the commission shall develop standardized inputs and assumptions to be used in the calculation and presentation of electric utility bill savings to a consumer that can be expected by using a solar energy system by vendors, installers, or financing entities, and the commission and each electrical corporation shall post these standardized inputs and assumptions on their Internet Web sites.
For purposes of this section, “solar energy system” means a solar energy device to be installed on a residential building that has the primary purpose of providing for the collection and distribution of solar energy for the generation of electricity, that produces at least one kW, and not more than five MW, alternating current rated peak electricity, and that meets or exceeds the eligibility criteria established pursuant to Section 25782 of the Public Resources Code.
ARTICLE 3. Independent Solar Energy Producers [2868. - 2869.]
The following definitions shall apply for purposes of this article:
“Independent solar energy producer” means a corporation or person employing one or more solar energy systems for the generation of electricity for any one or more of the following purposes:
Its own use or the use of its tenants.
The use of, or sale to, not more than two other entities or persons per generation system solely for use on the real property on which the electricity is generated, or on real property immediately adjacent thereto.
“Real property” means a single parcel of land.
“Solar energy system” means any configuration of solar energy devices that collects and distributes solar energy for the purpose of generating electricity and that has a single interconnection with the electric utility transmission or distribution network.
An independent solar energy producer contracting for the use or sale of electricity or the lease of a solar energy system, to an entity or person, for use in a residence shall include a disclosure to the buyer or lessee that, at a minimum, includes all of the following:
A good faith estimate of the kilowatthours to be delivered by the solar energy system.
A plain language explanation of the terms under which the pricing will be calculated over the life of the contract and a good faith estimate of the price per kilowatthour.
A plain language explanation of operation and maintenance responsibilities of the contract parties.
A plain language explanation of the contract provisions regulating the disposition or transfer of the contract in the event of a transfer of ownership of the residence, as well as the costs or potential costs associated with the disposition or transfer of the contract.
A plain language explanation of the disposition of the solar energy system at the end of the term of the contract.
The commission may require, as a condition of receiving ratepayer funded incentives, that an independent solar energy producer provide additional disclosure to the buyer or lessee, the commission, or both.
An independent solar energy producer contracting for the use or sale of electricity or the lease of a solar energy system, to an entity or person, for use in a residence shall record a Notice of an Independent Solar Energy Producer Contract, within 30 days of the signing of the contract, against the title to the real property on which the electricity is generated, and against the title to any adjacent real property on which the electricity will be used, in the office of the county recorder for the county in which the real property is located. The notice shall include all of the following and may include additional information:
If the solar energy system is located on the real property, a prominent title at the top of the document in 14-point type stating “Notice of an Independent Solar Energy Producer Contract” and the following statement:
“This real property is receiving part of its electric service from an independent solar energy producer that has retained ownership of a solar electric generation system that is located on the real property. The independent solar energy producer provides electric service to the current owner of this real property through a long-term contract for electric service. The independent solar energy producer is required to provide a copy of the contract to a prospective buyer of the real property within ten (10) days of the receipt of a written request from the current owner of this real property.”
If the solar energy system is located on an adjacent real property, a prominent title at the top of the document in 14-point type stating “Notice of an Independent Solar Energy Producer Contract” and the following statement:
“This real property is receiving part of its electric service from an independent solar energy producer that has retained ownership of a solar electric generation system that is located on an adjacent real property. The independent solar energy producer provides electric service to the current owner of this real property through a long-term contract for electric service. The independent solar energy producer is required to provide a copy of the contract to a prospective buyer of this real property within ten (10) days of the receipt of a written request from the current owner of this real property.”
The address and assessor’s parcel number of the real property against which the notice is recorded.
The name, address, and telephone number of the independent solar energy producer, and any other contact information deemed necessary by the independent solar energy producer.
A statement identifying whether the contract is a contract for the sale of electricity or for the lease of a solar energy system, and providing the dates on which the contract commences and terminates.
A plain language summary of the potential costs, consequences, and assignment of responsibilities, if any, that could result in the event the contract is terminated.
The recorded Notice of an Independent Solar Energy Producer Contract does not constitute a title defect, lien, or encumbrance against the real property, and the independent solar energy producer shall be solely responsible for the accuracy of the information provided in the notice and for recording the document with the county recorder.
An independent solar energy producer contracting for the use or sale of electricity or the lease of a solar energy system shall provide a copy of the existing contract to a prospective buyer of the real property where the electricity is used or generated within ten (10) days of the receipt of a written request from the current owner of the real property.
All contracts for the sale of electricity by an independent solar energy producer to an entity or person, for use in a residential dwelling shall be made available to the commission upon its request, and shall be confidential, except as provided for in this subdivision. The disclosures required by subdivision (a) may be made open to public inspection or made public by the commission.
A contract provided to the commission pursuant to this subdivision shall not be open to public inspection or made public, except on order of the commission, or by the commission or a commissioner in the course of a hearing or proceeding.
This subdivision does not eliminate or modify any rule or provision of law that provides for the confidentiality of information submitted to the commission in the course of its proceedings.
A master-meter customer of an electric utility who purchases electricity or leases a solar energy system from an independent solar energy producer, and who provides electric service to users who are tenants of a mobilehome park, apartment building, or similar residential complex, shall do both of the following:
Charge each user of the electric service that is under a submetered system a rate for the solar generated electricity not to exceed the rate charged by the independent solar energy producer or the electric utility’s rate for an equivalent amount of electricity, whichever is lower.
No transfer of real property subject to this article shall be invalidated solely because of the failure of any person to comply with any provision of this article. Any person who willfully or negligently violates or fails to perform any duty prescribed by any provision of this article shall be civilly liable in the amount of actual damages suffered by a transferee or transferor of the real property as a consequence of that violation or failure.
CHAPTER 9.5. Multifamily Affordable Housing Solar Roofs Program [2870. - 2870.]
As used in this section, the following definitions apply:
“CARE program” means the California Alternate Rates for Energy program established pursuant to Section 739.1.
“Program” means the Multifamily Affordable Housing Solar Roofs Program established pursuant to this chapter, which is also known as the Solar on Multifamily Affordable Housing Program.
“Qualified multifamily affordable housing property” means a multifamily residential property of at least five rental housing units that is, or will be, operated to provide deed-restricted low-income residential housing, as defined in clause (i) of subparagraph (A) of paragraph (3) of subdivision (a) of Section 2852, and that meets one or more of the following requirements:
The property is located in a disadvantaged community, as identified by the California Environmental Protection Agency pursuant to Section 39711 of the Health and Safety Code.
At least 66 percent of the households have incomes at or below 80 percent of the area median income, as defined in subdivision (f) of Section 50052.5 of the Health and Safety Code.
The property is owned by a tribe.
The property is rental housing property that is owned by one of the following:
A public housing authority created pursuant to the Housing Authorities Law (Chapter 1 (commencing with Section 34200) of Part 2 of Division 24 of the Health and Safety Code).
A public housing agency, as defined in Section 1437a of Title 42 of the United States Code.
“Solar energy system” means a solar energy photovoltaic device that meets or exceeds the eligibility criteria established pursuant to Section 25782 of the Public Resources Code.
“Tribe” means a California Native American tribe, as defined in Section 21073 of the Public Resources Code.
Adoption and implementation of the program may count toward the satisfaction of the commission’s obligation to ensure that specific alternatives designed for growth among residential customers in disadvantaged communities are offered as part of the standard contract or tariff authorized pursuant to paragraph (1) of subdivision (b) of Section 2827.1.
This section does not preclude electrical corporations from offering and administering a distributed energy resource program, including solar energy systems, in disadvantaged communities offered under current or proposed programs using funds provided under subdivision (c) of Section 748.5 or programs proposed to comply with paragraph (1) as approved by the commission.
The commission shall annually authorize the allocation of one hundred million dollars ($100,000,000) or 66.67 percent of available funds, whichever is less, from the revenues described in subdivision (c) of Section 748.5 for the program, beginning with the fiscal year commencing July 1, 2016, and ending with the fiscal year ending June 30, 2020. The commission shall continue authorizing the allocation of these funds through June 30, 2026, if the commission determines that revenues are available after 2020 and that there is adequate interest and participation in the program.
The commission shall consider the most appropriate program administration structure, including administration by a qualified third-party administrator, selected by the commission through a competitive bidding process, or administration by an electrical corporation, in an existing or future proceeding.
Not more than 10 percent of the funds allocated to the program shall be used for administration.
By June 30, 2017, the commission shall authorize the award of monetary incentives for qualifying solar energy systems that are installed on qualified multifamily affordable housing properties through December 31, 2032. The target of the program is to install a combined generating capacity of at least 300 megawatts on qualified properties.
The commission shall require that the electricity generated by qualifying renewable energy systems installed pursuant to the program be primarily used to offset electricity usage by low-income tenants. These requirements may include required covenants and restrictions in deeds.
The commission shall require that qualifying solar energy systems owned by third-party owners are subject to contractual restrictions to ensure that no additional costs for the system be passed on to low-income tenants at the properties receiving incentives pursuant to the program. The commission shall require third-party owners of solar energy systems to provide ongoing operations and maintenance of the system, monitor energy production, and, where necessary, take appropriate action to ensure that the kWh production levels projected for the system are achieved throughout the period of the third-party agreement. Those actions may include, but are not limited to, providing a performance guarantee of annual production levels or taking corrective actions to resolve underproduction problems.
The commission shall ensure that incentive levels for photovoltaic installations receiving incentives through the program are aligned with the installation costs for solar energy systems for affordable housing and take account of federal investment tax credits and contributions from other sources to the extent feasible.
The commission shall require that no individual installation receive incentives at a rate greater than 100 percent of the total system installation costs.
The commission shall establish local hiring requirements for the program to provide economic development benefits to disadvantaged communities.
The commission shall establish energy efficiency requirements that are equal to the energy efficiency requirements established for the program described in Section 2852, including participation in a federal, state, or utility-funded energy efficiency program or documentation of a recent energy efficiency retrofit.
For purposes of the new construction of qualified multifamily affordable housing property, moneys authorized through the program shall not be used to meet the requirements of Part 6 (commencing with Section 100) of Title 24 of the California Code of Regulations.
The commission shall ensure that electrical corporation tariff structures affecting the low-income tenants participating in the program continue to provide a direct economic benefit from the qualifying solar energy system.
If units are separately metered, low-income tenants who participate in the program shall receive credits on utility bills from the program. The commission shall ensure that utility bill reductions are achieved through tariffs that allow for the allocation of credits, such as virtual net metering tariffs designed for program participants, or other tariffs that may be adopted by the commission pursuant to Section 2827.1.
This chapter is not intended to supplant CARE program rates as the primary mechanism for achieving the goals of the CARE program.
The commission shall determine the eligibility of qualified multifamily affordable housing property tenants that are customers of community choice aggregators.
The commission may consider authorizing an advance payment loan to an eligible project if there is reasonable evidence to suggest that an advance payment loan would lead to the delivery of a project that would not occur absent the advance payment loan, so long as appropriate funding guarantee and loss recovery mechanisms are implemented to limit the risk of liability to the program from making the advance payment loan. The commission, in considering an advance payment loan, may prioritize allocating funding to a project where an advance payment loan will have the greatest impact on project delivery.
Every three years, the commission shall evaluate the program’s expenditures, commitments, uncommitted balances, future demands, performance, and outcomes and shall make any necessary adjustments to the program to ensure the goals of the program are being met. If, upon review, the commission finds there is insufficient participation in the program, the commission may credit uncommitted funds back to ratepayers pursuant to Section 748.5.
The commission shall include in the annual workplan required pursuant to Section 910, an annual update of the program that shall include, but not be limited to, the number of projects approved, number of projects completed, number of pending projects awaiting approval, and geographic distribution of the projects.
CHAPTER 10. Telephone Corporations [2871. - 2899.]
ARTICLE 1. Automatic Dialing-Announcing Devices [2871. - 2876.]
As used in this article, “automatic dialing-announcing device” means any automatic equipment which incorporates a storage capability of telephone numbers to be called or a random or sequential number generator capable of producing numbers to be called and the capability, working alone or in conjunction with other equipment, to disseminate a prerecorded message to the telephone number called.
The connection of automatic dialing-announcing devices to a telephone line is subject to this article and to the jurisdiction, control, and regulation of the commission.
A person shall not operate an automatic dialing-announcing device except in accordance with this article. The use of such a device by any person, either individually or acting as an officer, agent, or employee of a person or corporation operating automatic dialing-announcing devices, is subject to this article.
A person shall not operate an automatic dialing-announcing device in this state to place a call that is received by a telephone in this state during the hours between 9 p.m. and 9 a.m. California time.
This article does not prohibit the use of an automatic dialing-announcing device by any person exclusively on behalf of any of the following:
A school for purposes of contacting parents or guardians of pupils regarding attendance or the health or safety of pupils.
An exempt organization under the Corporation Tax Law (Part 11 (commencing with Section 23001) of Division 2 of the Revenue and Taxation Code) for purposes of contacting its members.
A privately owned or publicly owned cable television system for purposes of contacting customers or subscribers regarding the previously arranged installation of facilities on the premises of the customer or subscriber.
A privately owned or publicly owned public utility for purposes of contacting customers or subscribers regarding the previously arranged installation of facilities on the premises of the customer or subscriber or for purposes of contacting employees for emergency actions or repairs required for public safety or to restore services.
A petroleum refinery, chemical processing plant, or nuclear powerplant for purposes of advising residents, public service agencies, and the news media in its vicinity of an actual or potential life-threatening emergency.
This article does not prohibit law enforcement agencies, fire protection agencies, public health agencies, public environmental health agencies, city or county emergency services planning agencies, or any private for-profit agency operating under contract with, and at the direction of, one or more of these agencies, from placing calls through automatic dialing-announcing devices, if those devices are used for any of the following purposes:
Providing public service information relating to public safety.
Providing information concerning police or fire emergencies.
Providing warnings of impending or threatened emergencies.
Testing all modes of 911 emergency telephone systems, including basic 911 telephone services as described in Section 53107 of the Government Code, enhanced 911 emergency telephone services as described in Section 53119 of the Government Code, Next Generation 911 emergency communication systems as described in Section 53121 of the Government Code, and similar 911 technologies, for data accuracy and emergency alert notification system capabilities.
Calls authorized by this subdivision shall not be subject to Section 2874.
This article does not apply to any automatic dialing-announcing device that is not used to randomly or sequentially dial telephone numbers, but that is used solely to transmit a message to an established business associate, customer, or other person having an established relationship with the person using the automatic dialing-announcing device to transmit the message, or to any call generated at the request of the recipient.
The commission may determine any question of fact arising under this section.
The commission, in consultation with the Office of Emergency Services, shall open an investigative proceeding to determine whether standardized notification systems and protocol should be utilized by entities that are authorized to use automatic dialing-announcing devices pursuant to subdivision (e) of Section 2872, to facilitate notification of affected members of the public of local emergencies. The commission shall not establish standards for notification systems or standard notification protocol unless it determines that the benefits of the standards exceed the costs.
Automatic dialing-announcing devices may be used to place calls over telephone lines only pursuant to a prior agreement between the persons involved, whereby the person called has agreed that he or she consents to receive such calls from the person calling, or as specified in Section 2874.
Whenever telephone calls are placed through the use of an automatic dialing-announcing device, the device may be operated only after an unrecorded, natural voice announcement has been made to the person called by the person calling. The announcement shall do all of the following:
State the nature of the call and the name, address, and telephone number of the business or organization being represented, if any.
Inquire as to whether the person called consents to hear the prerecorded message of the person calling.
Inform the person called if the prerecorded message uses an artificial voice.
The person calling, as described in subdivision (a), shall disconnect the automatic dialing-announcing device from the telephone line upon the termination of the call by either the person calling or the person called.
For purposes of this section, both of the following definitions apply:
“Artificial intelligence” means an engineered or machine-based system that varies in its level of autonomy and that can, for explicit or implicit objectives, infer from the input it receives how to generate outputs that can influence physical or virtual environments.
“Artificial voice” means a voice that is generated or significantly altered using artificial intelligence.
No person shall connect any automatic dialing-announcing device to any telephone line without first making written application to the telephone corporation within whose service area telephone calls through the use of such device are proposed to be placed. In such application, the person shall provide information as to the type of automatic dialing-announcing device proposed to be connected, the time of day such telephone calls are proposed to be placed using such device, the anticipated number of calls proposed to be placed during the specified calling period, the average length of a completed call, and such additional information as the corporation or the commission may require. Upon receiving such an application for service, the corporation shall review the furnished information and, if it appears that calling patterns would create a traffic overload condition or the service would be detrimental to the services of other customers of the corporation, it may deny the application or modify the application and grant the application as so modified.
On and after July 1, 2002, no person operating any automatic equipment that incorporates a storage capability of telephone numbers to be called or a random or sequential number generator capable of producing numbers to be called may make a telephone connection for which no person, acting as an agent or telemarketer, is available for the person called.
Notwithstanding subdivision (a), the commission shall establish an acceptable error rate for telephone connections made in violation of subdivision (a). The commission shall determine the error rate, if any, before July 1, 2002.
The commission may require any person operating equipment as described in subdivision (a) to maintain records of telephone connections made for which no person, acting as an agent or telemarketer, is available for the person called. The commission may require copies of those records to be submitted to the commission.
Any person violating this article is guilty of a civil offense and is subject to either or both of the following penalties:
A fine of not to exceed five hundred dollars ($500) for each violation, levied and enforced by the commission, on complaint or on its own motion, pursuant to Chapter 11 (commencing with Section 2100) of Part 1.
Disconnection of telephone service to the automatic dialing-announcin g device for a period of time which shall be specified by the commission.
ARTICLE 2. Customer and Subscriber Services [2881. - 2890.2.]
The commission shall design and implement a program to provide a telecommunications device capable of serving the needs of individuals who are deaf or hard of hearing, together with a single party line, at no charge additional to the basic exchange rate, to a subscriber who is certified as an individual who is deaf or hard of hearing by a licensed physician and surgeon, audiologist, or a qualified state or federal agency, as determined by the commission, and to a subscriber that is an organization representing individuals who are deaf or hard of hearing, as determined and specified by the commission pursuant to subdivision (h). A licensed hearing aid dispenser may certify the need of an individual to participate in the program if that individual has been previously fitted with an amplified device by the dispenser and the dispenser has the individual’s hearing records on file before certification. In addition, a physician assistant or nurse practitioner may certify the needs of an individual who has been diagnosed by a physician and surgeon as being deaf or hard of hearing to participate in the program after reviewing the medical records or copies of the medical records containing that diagnosis.
The commission shall also design and implement a program to provide a dual-party relay system, using third-party intervention to connect individuals who are deaf or hard of hearing and offices of organizations representing individuals who are deaf or hard of hearing, as determined and specified by the commission pursuant to subdivision (h), with persons of normal hearing by way of intercommunications devices for individuals who are deaf or hard of hearing and the telephone system, making available reasonable access of all phases of public telephone service to telephone subscribers who are deaf or hard of hearing. In order to make a dual-party relay system that will meet the requirements of individuals who are deaf or hard of hearing available at a reasonable cost, the commission shall initiate an investigation, conduct public hearings to determine the most cost-effective method of providing dual-party relay service to the deaf or hard of hearing when using a telecommunications device, and solicit the advice, counsel, and physical assistance of statewide nonprofit consumer organizations of the deaf, during the development and implementation of the system. The commission shall apply for certification of this program under rules adopted by the Federal Communications Commission pursuant to Section 401 of the federal Americans with Disabilities Act of 1990 (Public Law 101-336).
The commission shall also design and implement a program whereby specialized or supplemental telephone communications equipment may be provided to subscribers who are certified to be disabled at no charge additional to the basic exchange rate. The certification, including a statement of visual or medical need for specialized telecommunications equipment, shall be provided by a licensed optometrist, physician and surgeon, physician assistant, or nurse practitioner, acting within the scope of practice of the applicable license, or by a qualified state or federal agency as determined by the commission. The commission shall, in this connection, study the feasibility of, and implement, if determined to be feasible, personal income criteria, in addition to the certification of disability, for determining a subscriber’s eligibility under this subdivision.
The commission shall also design and implement a program to provide access to a speech-generating device to any subscriber who is certified as having a speech disability at no charge additional to the basic exchange rate. The certification shall be provided by a licensed physician, licensed speech-language pathologist, nurse practitioner, or qualified state or federal agency. The commission shall provide to a certified subscriber access to a speech-generating device that is all of the following:
A telecommunications device or a device that includes a telecommunications component.
Appropriate to meet the subscriber’s needs for access to, and use of, the telephone network, based on the recommendation of a licensed speech-language pathologist.
Consistent with the quality of speech-generating devices available for purchase in the state.
The commission shall adopt rules to implement this subdivision and subdivision (e) by January 1, 2014.
All of the following apply to any device or equipment described in this section that is classified as durable medical equipment under guidelines established by the United States Department of Health and Human Services:
It is the intent of the Legislature that the commission be the provider of last resort and that eligible subscribers first obtain coverage from any available public or private insurance.
The commission may require the subscriber to provide information about coverage for any or all of the cost of the device or equipment that is available from a public or private insurance, the cost to the subscriber of a deductible, copayment, or other relevant expense, and any related benefit cap information.
The total cost of a device or equipment provided to a subscriber under this section shall not exceed the rate of reimbursement provided by Medi-Cal for that device or equipment.
This section does not require the commission to provide training to a subscriber on the use of a speech-generating device.
The commission shall administer a surcharge to collect revenues, subject to an annual appropriation of moneys by the Legislature, to allow providers of the equipment and service specified in subdivisions (a) to (d), inclusive, to recover costs as they are incurred under this section. The surcharge shall be in effect until December 31, 2034. The commission shall require that the programs implemented under this section be identified on subscribers’ bills, and shall transfer moneys collected by the commission from the surcharge to the Controller for deposit into the Deaf and Disabled Telecommunications Program Administrative Committee Fund.
The commission may collect a sum not to exceed one hundred million dollars ($100,000,000) per year by imposing the surcharge pursuant to paragraph (1).
The commission shall determine and specify those statewide organizations representing the deaf or hard of hearing that shall receive a telecommunications device pursuant to subdivision (a), or a dual-party relay system pursuant to subdivision (b), or both, and in which offices the equipment shall be installed in the case of an organization having more than one office.
The commission may direct a telephone corporation subject to its jurisdiction to comply with its determinations and specifications pursuant to this section.
The commission may make recommendations to the Legislature regarding appropriations from the Deaf and Disabled Telecommunications Program Administrative Committee Fund.
In order to continue to meet the access needs of individuals with functional limitations of hearing, vision, movement, manipulation, speech, and interpretation of information, the commission shall perform an ongoing assessment of, and if appropriate, expand the scope of, the program to allow for additional access capability consistent with evolving telecommunications technology.
The commission shall structure the programs required by this section so that a charge imposed to promote the goals of universal service reasonably equals the value of the benefits of universal service to contributing entities and their subscribers.
In addition to the requirements of Section 2881, the commission shall design and implement a program to provide a telecommunications device capable of servicing the needs of the deaf or severely hard of hearing, together with a single party line, at no charge additional to the basic exchange rate, to any subscriber that is an agency of state government and that the commission determines serves a significant portion of the deaf or severely hard-of-hearing population, and to an office located in the State Capitol and selected by the Joint Rules Committee, for purposes of access by the deaf or severely hard of hearing to Members of the Legislature.
The commission shall permit providers of equipment and service specified in subdivision (a) to recover costs as they are incurred under this section pursuant to subdivision (g) of Section 2881.
The commission may direct any telephone corporation subject to its jurisdiction to comply with its determinations pursuant to this section.
In addition to the requirements of Section 2881, the commission shall design and implement a program that shall provide for publicly available telecommunications devices capable of servicing the needs of the deaf or hard of hearing in existing buildings, structures, facilities, and public accommodations of the type specified in Section 4450 of the Government Code and Sections 19955.5 and 19956 of the Health and Safety Code, making available reasonable access of all phases of public telephone service to individuals who are deaf or hard of hearing. The commission shall direct the appropriate committee under its control to determine and specify locations within existing buildings, structures, facilities, and public accommodations in need of a telecommunications device and to contract for the procurement, installation, and maintenance of these devices. In the letting of the contract, the commission shall direct the committee to ensure consideration of for-profit and nonprofit corporations, including nonprofit corporations with demonstrated service to individuals who are deaf or hard of hearing and whose boards of directors and staff are made up of a majority of those individuals. The commission shall also direct the committee to seek the cooperation of the owners, managers, and tenants of the existing buildings, structures, facilities, and public accommodations that have been determined to be in need of a telecommunications device with regard to its installation and maintenance. The commission shall phase in this program over a reasonable period of time, beginning no later than January 1, 1998, giving priority to those existing buildings, structures, facilities, and public accommodations determined by the commission, with the advice and counsel of statewide nonprofit consumer organizations for the deaf, to be of most importance and usefulness to the deaf or hard of hearing.
The commission shall ensure that costs are recovered as they are incurred under this section, including any costs incurred by the owners, managers, or tenants of existing buildings, structures, facilities, and public accommodations, and shall use for this purpose the rate recovery mechanism established pursuant to subdivision (g) of Section 2881. The commission shall also establish a fund and require separate accounting for the program implemented under this section and, in addition, shall require that the surcharge used to fund the program not exceed two-hundredths of 1 percent, that it be combined with the surcharge required by subdivision (g) of Section 2881, and that it count toward the limits set by that subdivision. This surcharge shall be in effect until January 1, 2006.
“Existing buildings, structures, facilities, and public accommodations,” for purposes of this section, means those buildings, structures, facilities, and public accommodations or parts thereof that were constructed or altered before January 26, 1993, or are otherwise not required by Section 303 of the federal Americans with Disabilities Act of 1990 (P.L. 101-336; 42 U.S.C. Sec. 12183) or any other section of that act and its implementing regulations and guidelines, to have a publicly available telecommunications device capable of serving the needs of the deaf or hard of hearing.
The Legislature finds and declares all of the following:
Section 278 requires the commission to transfer to the Controller for deposit in the Deaf and Disabled Telecommunications Program Administrative Committee Fund all revenues collected by telephone corporations to fund programs to provide specified telecommunications services and equipment to deaf, disabled, and hard-of-hearing persons, as specified in Sections 2881, 2881.1, and 2881.2.
The commission issued a report to the Legislature in May 2001, addressing compliance issues pertaining to the programs specified in Sections 2881, 2881.1, and 2881.2, including a recommendation to secure legislative authorization for the commission to contract with outside entities for the provision of services and equipment mandated by Sections 2881, 2881.1, and 2881.2.
The telecommunications services and equipment provided to deaf, disabled, and hard-of-hearing individuals and their families, as specified in Sections 2881, 2881.1, and 2881.2, are of such a highly specialized and technical nature that the necessary expert knowledge, ability, and experience are not available within the current state civil service system.
It is the intent of the Legislature, in enacting this section, to do all of the following:
Authorize the commission to enter into contracts for the provision of telecommunications services and equipment for deaf, disabled, and hard-of-hearing persons in a manner that protects and enhances the current statewide infrastructure and coordinated delivery of those services and equipment and includes a priority for maintaining long-term continuity of program administration and maximum involvement of the deaf and disabled community in program governance.
Strengthen program priorities for expanded outreach through continuing consultation with, and participation by, the deaf, disabled, and hard-of-hearing community in order to ensure the state’s network of services reach hard-to-serve populations, including rural, inner-city, and urban areas.
Develop a mechanism to achieve cost-effective and timely deployment of new and emerging telecommunications technologies, to the extent fiscally and economically feasible.
In order for the commission to ensure continued provision of telecommunications services and equipment for deaf, disabled, and hard-of-hearing persons, the commission, subject to annual appropriation of funds by the Legislature and consistent with state contracting requirements, may contract with entities, including nonprofit entities, or persons that have the necessary expert knowledge, ability, and experience to provide, manage, or operate the programs described in Sections 2881, 2881.1, and 2881.2.
The commission may include provisions that accomplish any of the following in contracts authorized by this section:
Establish standards and procedures, including prior commission approval, for subcontracting.
Establish standards and procedures regarding personnel and accounting practices.
Require budget approval.
Require periodic audits.
Monitor performance and establish performance standards and the method of evaluating performance, including remedies for unsatisfactory performance.
Establish standards and procedures to investigate and resolve complaints.
Provide for any other terms or restrictions as the commission finds necessary to ensure that the public funds are used in accordance with the goals of the Legislature and the commission.
Notwithstanding any other law, a contract entered into pursuant to this section may provide for periodic advance payments for telecommunications services to be performed or telecommunications equipment to be provided. An advance payment made pursuant to this section shall not exceed 25 percent of the total annual contract amount.
Any contractor the commission selects shall demonstrate knowledge of and the capacity to provide specialized telecommunications services and equipment to deaf, disabled, and hard-of-hearing persons, and shall be required to consult with the Telecommunications Access for Deaf and Disabled Administrative Committee regarding the specialized needs of individuals using program services and equipment, as specified in Sections 2881, 2881.1, and 2881.2.
The Legislature finds and declares all of the following:
As originally enacted, Section 2883 required local telephone corporations to provide a residential telephone connection with no customer account attached, also known as a warm line, access to “911” emergency service. This section took effect in 1995 when basic local exchange telephone service was provided exclusively by incumbent wireline providers operating within their franchise territories. Local exchange competition was nonexistent and wireless telephones were expensive and not in widespread use.
At that time, the number of warm lines was very small. The practice of leaving warm lines in place continued the availability of “911” emergency service upon disconnection and permitted new residential service orders to be completed with minimum cost and delay.
In recent years, the providers of warm line service have lost a significant percentage of their customer base to competitors. Today, the number of warm lines in California has increased in proportion to the loss of wireline customers. An estimated 2,000,000 warm lines exist today and that number continues to grow.
Rather than being converted to new active service accounts, many warm lines remain in place indefinitely, even when customers switch to other voice carriers that provide “911” emergency service access. As warm lines age, deterioration can create shorts in these lines that trigger “911” calls, also known as phantom “911” calls because there is no person making the call.
Responding to phantom “911” calls places a drain on public safety resources including increased costs for public safety responders. In addition, the state pays providers on a monthly basis, based on volume, to maintain number and location records in the state “911” database, including the records for increasing numbers of warm lines.
The cost to local telephone companies to energize and maintain warm lines is the same as for active service accounts. Energy provided to warm lines at residences where access to “911” emergency service is being obtained through a different provider is a waste of limited natural resources.
It is the intent of the Legislature to amend Section 2883 in a manner that continues to provide a public safety net in a competitive telecommunications market, eliminates phantom “911” calls, conserves energy for productive uses, and limits costs to the state, local governments, and local telephone corporations.
All local telephone corporations, excluding providers of mobile telephony service and mobile satellite telephone service, as defined in Section 224.4, to the extent permitted by existing technology or facilities, shall provide every subscriber of tariffed residential basic exchange service with access to “911” emergency service.
A local telephone corporation shall provide access to services described in subdivision (b) for at least 120 days after disconnection of residential basic exchange service for nonpayment of any delinquent account or indebtedness owed by the subscriber to the telephone corporation. A subscriber and a telephone corporation may arrange payment schedules to regain full service.
If a local telephone corporation chooses to terminate access to the services described in subdivision (b) after 120 days as authorized in subdivision (c), the local telephone corporation shall inform residential subscribers as part of the notice of suspension or disconnection of service for nonpayment of all of the following information:
The availability of the “911” emergency service described in subdivision (b) for 120 days after disconnection of residential basic exchange service.
Options that may be available to avoid suspension or disconnection of service.
Other options that may be available for obtaining access to “911” emergency service consistent with a customer education program, if adopted by the commission.
This section shall not be construed to relieve any person of an obligation to pay a debt owed to a telephone corporation.
This section shall not require a local telephone corporation to provide “911” access pursuant to this section if doing so would preclude providing service to subscribers of residential telephone service.
A local telephone corporation may disconnect any line in existence on January 1, 2011, providing access to “911” emergency services with no customer account attached for that line, if notice of not less than 90 days prior to disconnection is provided to the last known address of record associated with that line that is being disconnected. The notice shall provide information about all of the following:
“911” emergency service is provided to customers who purchase voice telephone service.
Access to “911” emergency services may have been provided to the address, to the extent permitted by existing technology or facilities, but will be discontinued as provided in this section.
A contact number for further information, including information about low cost options, including the Universal Lifeline Telephone Service (ULTS) program.
Contact information for the commission.
A local telephone corporation shall not be required to terminate access to any line providing access to “911” emergency services with no customer account attached for that line.
The commission shall, pursuant to its existing authority, by rule or order, establish procedures governing telephone corporation billing practices and operations to require every telephone corporation, on and after July 1, 1986, or on and after another date or dates which the commission finds and determines to be appropriate and feasible with respect to the capability of particular telephone equipment, to offer residential subscribers the option of deleting access to a class of information-access telephone service, commonly referred to as “900 or 976 service,” whereby recorded commercial, informational, or public service messages, interactive computer programs, and other services, are provided for a charge, in addition to the basic local exchange charge, to the person calling, and to notify new residential subscribers of the options available to delete information-access services through telephone service.
The commission shall specify a method or methods for telephone corporations to institute this deletion of access option for residential subscribers, taking into consideration the operational requirements of the various types of telephone equipment in use throughout the state. The commission shall impose no charge on residential telephone subscribers for this deletion of access option, and shall require telephone corporations to refund to subscribers any amounts paid prior to the effective date of the amendments to this section enacted in 1988 for deletion of access. The commission shall determine and implement a method by which telephone corporations shall be recompensed for the expenses of providing this deletion of access option.
The commission shall require every telephone corporation which furnishes information-access telephone service to make available a separate, easily distinguishable telephone prefix number for information providers which provide messages which constitute harmful matter and for those who provide other than messages which constitute harmful matter, and to request every information provider to designate which prefix corresponds to the type of messages it proposes to provide. Any information provider which provides any live or recorded message constituting harmful matter through any information-access telephone number other than one within the prefix assigned to information providers furnishing messages constituting harmful matter is in violation of Section 2111. The commission shall require the telephone corporation to offer residential subscribers the option of deleting access to the telephone prefix number by which messages constituting harmful matter are accessed, pursuant to subdivision (a), and shall determine and implement a method by which a telephone corporation shall be recompensed for the expenses of providing this deletion of access option to residential subscribers.
As used in this section, “harmful matter” means harmful matter as defined in subdivision (a) of Section 313 of the Penal Code.
If any provision of this section or the application thereof to any person or circumstances is held invalid, that invalidity shall not affect other provisions or applications of the section which can be given effect without the invalid provision or application, and to this end the provisions of this section are severable.
Except as specified in subdivision (b), the billing and collection practices of a telephone corporation for services rendered to or for an information service that contains harmful matter, as defined in subdivision (a) of Section 313 of the Penal Code, are not subject to the jurisdiction and control of the commission, notwithstanding Section 2884, but are a matter for contractual arrangement between the telephone corporation and the information provider.
Nothing in subdivision (a) affects the commission’s jurisdiction over billing and collection for any other information service.
The commission may, on complaint or on its own motion, after a hearing, find and determine that circumstances including, but not limited to, anticompetitive results, require the exercise of jurisdiction and control by it over those matters removed from its jurisdiction and control by subdivision (a), and may then exercise that jurisdiction and control.
Subdivision (a) applies only to that class of information-access telephone service furnished within or between service areas, as defined in Section 230.3, through the use of either a “976” prefix or a “900” access code telephone number, and applies only to billing and collection services in that class of service.
The commission may investigate and consider, for purposes of establishing telephone rates, revenues and expenses related to any billing or collection services rendered by a telephone corporation to or for an information provider.
A telephone corporation shall, before refusing to provide billing and collection services for any information service, give the information provider of that service and the commission not less than 30 days’ advance notice.
If a telephone corporation elects to enter into a contractual arrangement to provide billing and collection services to an information provider, the telephone corporation shall provide those services to the information provider under the same terms, conditions, and rates that the service is offered to all other information providers contracting for the services. The telephone corporation shall provide copies of the contracts to the commission and, on request, to any other interested party.
Notwithstanding Section 17024 of the Business and Professions Code, billing and collection services described in subdivision (a) are services subject to Part 2 (commencing with Section 16600) of Division 7 of that code. A person or firm claiming a violation of Section 17045 of that code, with respect to those services, may proceed in accordance with Article 4 (commencing with Section 17070) of Chapter 4 of Part 2 of Division 7 of that code, or pursue any other remedy available under law.
The commission shall require telephone corporations and providers of information-access telephone services to institute a method of handling subscriber complaints concerning these services, which shall include provision for a waiver of all of the charges for these services for a first occasion of their inadvertent or mistaken use.
Every telephone corporation and provider of information-access telephone services providing messages that constitute harmful matter, as defined in Section 313 of the Penal Code, shall provide for a one-time waiver of all subscriber charges associated with a collect call when the call contains harmful matter and the person making or accepting the call is a minor.
The commission shall, on or before July 1, 1987, determine the feasibility of requiring that, whenever a call is placed from a cellular telephone, the person receiving the call receive a notification indicating that the call is being placed from a cellular telephone and that the telephone conversation may not be totally private. The determination of feasibility shall include findings and conclusions on the necessity for, and the costs of, implementing a cellular telephone call notification system and on subscriber reaction to the notification system or systems proposed or employed. If the commission determines, in view of its findings and conclusions, that it is feasible for telephone corporations to implement a cellular telephone call notification system, it shall, by rule or order, require telephone corporations operating cellular telephones to implement that system.
The commission shall require mobile telephony service, as defined in Section 224.4, carriers to provide the commission, within six months of the effective date of the act that adds this section, and thereafter as requested by the commission, with information, as specified by the commission, concerning service quality and customer complaints.
In addition to any other sanctions available, the commission shall have the authority to assess any and all of the following specific penalties for mobile telephony carrier noncompliance with commission rules, practices, and procedures respecting the filing of required periodic information and reports to the commission:
The revocation or suspension, on an expedited basis, of temporary tariffing authority granted the carrier.
The revocation or suspension, on an expedited basis, of other rate flexibility or promotional program authority granted the carrier.
The commission shall require every telephone corporation furnishing mobile telephony service, as defined in Section 224.4, to establish a pricing system made available to subscribers that shall distinguish on the billing invoice charges to a subscriber for calls not completed from any other service charge on the billing invoice.
The commission shall require that those calls which are not completed shall not be charged more than 50 percent of the charge established for completed subscriber initiated calls.
For purposes of this section, a call is not completed when it originates from the mobile telephony service handset and any of the following occurs:
The terminating line is busy and the originator receives a busy signal.
The terminating line does not answer and the originator receives an audible ring.
No radios are available and the originator receives a reorder signal.
The mobile telephony switching office cannot connect the call to the public network and the originator receives a reorder signal.
The public network cannot complete the call to the terminating number and the originator receives a reorder signal.
The commission shall pursue all available legal remedies to redraw intrastate inter-exchange, also known as local access and transport area, or LATA, boundaries for the purpose of eliminating restrictions that result in discriminatory costs, added inconvenience, and less service for consumers of telecommunications services solely in and between the Counties of Monterey and Santa Cruz.
An information provider engaged in furnishing any live, recorded, or recorded-interactive audio text through information access telephone service shall provide a (1) delayed timing of information charges and (2) price disclosure message.
The telephone corporation shall provide information providers, described in subdivision (a), with a period of a minimum of 12 seconds for a delayed timing of information charges and price disclosure message. If the delayed timing period is exceeded, a consumer shall be billed from the time of the initial connection, and transport charges shall be billed to the information provider from the time of the initial connection. If the consumer disconnects the call within the delayed timing period, no information charge shall be billed to the caller.
During the delayed timing period, the information provider shall inform the consumer of all of the following:
The name of the programs.
The information charge for the call.
The date the information was recorded, if the information is a recorded message.
That if the caller disconnects the call within the delayed timing period, the consumer will not be charged for the call.
This information shall be provided at the beginning of every call and at least three seconds shall be allowed at the end of the message within the delayed timing period for the consumer to hang up without being charged if he or she has not already disconnected the call. The information provider shall provide a tone to indicate the end of the delayed timing period.
This section does not apply to audiotex programs with restricted access via personal identification number (PIN) code or special password.
As used in this section, “delayed timing of information charges” means a service feature which delays commencement of billing of charges for a minimum of 12 seconds in order to provide the information required by subdivision (c).
Every violation of this section is a misdemeanor.
No telephone corporation or provider of information-access telephone services shall charge the subscribing party for a call made to a telephone number with an “800” prefix, unless the telephone number with an “800” prefix is an information service complying with the presubscription requirements imposed by Federal Communications Commission Docket No. 93–22.
Before a telephone corporation exits the business of providing interexchange services to all of its customers or to an entire class of its customers, the telephone corporation or any person, firm, or corporation representing the telephone corporation, shall provide those affected customers with a written notice at least 30 days prior to the proposed transfer of those customers to another telephone corporation. The notice shall include all of the following:
A straightforward description of the proposed transfer.
All applicable rates, terms, and conditions of the new service.
A statement of the customer’s right to transfer to another telephone corporation.
A toll-free customer service telephone number for the purpose of responding to customers’ questions.
Any transfer of customer services shall be effectuated without charge.
Subdivision (a) does not apply when the telephone corporation has entered into a written contract with the customer and when the change in telephone corporation results in no rate increase for the customer.
A local exchange service provider that offers and charges for pay per use features that do not require an access code to be dialed to activate the service shall provide a new residential subscriber, including an existing residential customer ordering an additional line, during the verbal service order process, with information about those features. The representatives of a provider shall offer that subscriber blocking options for those features.
A local exchange service provider that offers the features described in subdivision (a) shall advise an existing residential subscriber who inquires about the features, or who seeks a bill adjustment for the inadvertent or unauthorized use of those per use custom calling features, that the features can be blocked and shall inquire as to whether the subscriber would like to block any or all of the features.
A local exchange service provider that offers the features described in subdivision (a) shall provide notice to all existing residential subscribers not later than May 1, 2000, describing all features provided on a per use basis, the charge for each activation, any additional usage or other charges, and detailed information about the ability to block these features.
The notice shall contain a toll-free number for further information and shall contain a noticeable postcard size bill insert that may be returned in the subscriber’s bill envelope if they wish to block any or all of the per use features described in subdivision (a).
A local exchange service subscriber that has not blocked per use features in accordance with this section is entitled to a one-time bill adjustment which shall equal the sum of the charges for every incident that occurred during the first billing cycle pursuant to which the subscriber notifies the local exchange service provider that inadvertent or unauthorized activation occurred with regard to those per use services that do not require coded dialing to activate. The one-time bill adjustment shall include an adjustment for any additional usage charges occurring as a result of inadvertent or unauthorized activation. The adjustment shall take the form of a credit to the subscriber’s account if the existing technology or facilities of the local exchange service provider measure usage and permit a usage credit to be determined and provided.
Nothing in this section prohibits a local exchange service provider from providing additional bill adjustments at its discretion in connection with charges imposed for features described in subdivision (a).
No telephone corporation, or any person, firm, or corporation representing a telephone corporation, shall make any change or authorize a different telephone corporation to make any change in the provider of any telephone service for which competition has been authorized of a telephone subscriber until all of the following steps have been completed:
The telephone corporation, its representatives or agents shall thoroughly inform the subscriber of the nature and extent of the service being offered.
The telephone corporation, its representatives or agents shall specifically establish whether the subscriber intends to make any change in his or her telephone service provider, and explain any charges associated with that change.
For sales of residential service, the subscriber’s decision to change his or her telephone service provider shall be confirmed by an independent third-party verification company, or as provided in paragraph (5). For purposes of this provision, the confirmation by a third-party verification company shall be made as follows:
The third-party verification company shall meet each of the following criteria:
Be independent from the telephone corporation that seeks to provide the subscriber’s new service.
Not be directly or indirectly managed, controlled, or directed, or owned wholly or in part, by the telephone corporation that seeks to provide the new service or by any corporation, firm, or person who directly or indirectly manages, controls, or directs, or owns more than 5 percent of the telephone corporation.
Operate from facilities physically separate from those of the telephone corporation that seeks to provide the subscriber’s new service.
Not derive commissions or compensation based upon the number of sales confirmed.
The telephone corporation seeking to verify the sale shall do so by connecting the subscriber by telephone to the third-party verification company or by arranging for the third-party verification company to call the subscriber to confirm the sale.
The third-party verification company shall obtain the subscriber’s oral confirmation regarding the change, and shall record that confirmation by obtaining appropriate verification data. The record shall be available to the subscriber upon request. Information obtained from the subscriber through confirmation shall not be used for marketing purposes. Any unauthorized release of this information is grounds for a civil suit by the aggrieved subscriber against the telephone corporation or its employees who are responsible for the violation.
Notwithstanding subparagraphs (A), (B), and (C), a service provider shall not be required to comply with these provisions when the customer directly calls the local service provider to make changes in service providers. However, a service provider shall not avoid the verification requirements by asking a subscribing customer to contact a local exchange service provider directly to make any change in the service provider. A local exchange service provider shall be required to comply with these verification requirements for its own competitive services. However, a local exchange service provider shall not be required to perform any verification requirements for any changes solicited by another telephone corporation.
For a sale of residential service, the telephone corporation seeking to verify the change in service, in addition to the requirements of paragraph (3), shall notify the subscriber by United States Postal Service that the subscriber’s telephone service provider has been changed. The service provider that initiated the change shall send that notice within 14 days of the date of the change. The notice shall provide the subscriber with clear, legible notice of the change in service provider, and shall include a customer service telephone number for the subscriber to call if the subscriber did not authorize the change in service.
Confirmation of a sale of residential service may be made using an electronic means that complies with Section 64.1120 of Title 47 of the Code of Federal Regulations in effect as of June 17, 2008.
For sales of all nonresidential services, the subscriber’s decision to change his or her service provider shall be confirmed through any of the following means:
Independent third-party verification, as set forth in paragraph (3) of subdivision (a).
The telephone corporation shall mail to the subscriber an information package seeking confirmation of his or her change in the telephone corporation. The information package shall describe the new service and shall include a postage prepaid postcard or mailer that the subscriber can use to deny, cancel, or confirm a service order, as soon as possible, and wait 14 days after the information package is mailed before making the change in the telephone corporation. The telephone corporation shall make the change only if the subscriber does not cancel the change in service order.
Verify the subscriber’s change in his or her telephone service provider by obtaining the subscriber’s signature on a document fully explaining the nature and extent of the action. The document shall be a separate document whose sole purpose is to explain the nature and extent of the action.
Obtain the subscriber’s authorization through an electronic means that takes the information, including the calling number, and confirms the change to which the subscriber has given his or her consent.
Where the telephone corporation obtains a written order for service, the document shall thoroughly inform the subscriber of the nature and extent of the action. The subscriber shall be furnished with a copy of the signed document. The subscriber by his or her signature on the document shall indicate a full understanding of the relationship being established with the telephone corporation. If a written subscriber solicitation or other document contains a letter of agency authorizing a change in service provider, in combination with other information including, but not limited to, inducements to subscribers to purchase service, the solicitation shall include a separate document whose sole purpose is to explain the nature and extent of the action. If any part of a mailing to a prospective subscriber is in language other than English, any written authorization contained in the mailing shall be sent to the same prospective subscriber in the same language.
The telephone corporation shall retain a record of the verification of the sale for at least one year. These records shall be made available to the subscriber, the Attorney General, or the commission upon request.
If a residential or business subscriber that has not signed an authorization notifies the telephone corporation within 90 days that he or she does not wish to change telephone corporations, the subscriber shall be switched back to his or her former telephone corporation at the expense of the telephone corporation that initiated the change.
For purposes of this section, competitive services are those services where subscribers have the ability to presubscribe to a telephone service provider.
When a subscriber changes telephone service providers, the change shall be conspicuously noticed on the subscriber’s bill. Notice in the following form is deemed to comply with this subdivision:“NOTICE: Your local (or long distance) telephone service provider has been changed from (name of prior provider) to (name of current provider). Cost of change: $ ____.”
Any telephone corporation that violates the verification procedures described in this section shall be liable to the telephone corporation previously selected by the subscriber in an amount equal to all charges paid by the subscriber after the violation.
In addition to the liability described in subdivision (e), any telephone corporation that violates the verification procedures described in this section shall credit to a subscriber any charges paid by the subscriber in excess of the amount that the subscriber would have been obligated to pay had the subscriber’s telephone service not been changed. The commission shall adopt regulations to govern credits to subscribers pursuant to this subdivision.
The remedies provided by this section are in addition to any other remedies available by law.
As described in federal law, no telephone corporation, or any person, firm, or corporation representing a telephone corporation, shall make any change or authorize a different telephone corporation to make any change in the provider of any telephone service for which competition has been authorized of a telephone subscriber without having on file, or having instituted reasonable steps designed to obtain, signed, dated orders for service from the subscriber. All orders shall be in the form prescribed in federal law for letters of agency. As described in federal law, the telephone corporation is responsible for charges associated with disputed changes in telephone service for which it cannot produce a signed, dated order for service from the subscriber. This subdivision applies to all intrastate services for which competition has been authorized.
The commission shall, by rule or order, require all local exchange carriers to do both of the following:
Include in their telephone directory information concerning emergency situations which may affect the telephone network. The information shall include the procedures which the corporation will follow during emergencies, how telephone subscribers can best use the telephone network in an emergency situation, and the emergency services available by dialing “911.”
Annually provide to all subscribers in the form of a billing insert, which need not be a separate document, information concerning emergency situations which may affect the telephone network. The information shall include the procedures which the corporation will follow during emergencies, how telephone subscribers can best use the telephone network in an emergency situation, and the emergency services available by dialing “911.” The billing insert shall additionally direct the subscriber to consult the telephone directory for similar information concerning the use of the telephone in emergency situations.
The commission periodically shall assess the reliability of the public telecommunications network and, if necessary, develop recommendations for improvement. The assessment shall include, but not be limited to, all of the following:
An analysis of those factors that pose a risk to network reliability, including the adequacy of independent sources of reserve power.
Consideration as to whether development of reliability standards is appropriate.
Consideration as to whether procedures should be developed to notify customers about accessing other telecommunications companies in the event of a service disruption.
No person or corporation shall misrepresent its association or affiliation with a telephone carrier when soliciting, inducing, or otherwise implementing the subscriber’s agreement to purchase the products or services of the person or corporation, and have the charge for the product or service appear on the subscriber’s telephone bill.
The provisions of Chapter 11 (commencing with Section 2100) of Part 1 of Division 1 apply to a public utility subject to this section and Section 2890. If the commission finds that a person or corporation or its billing agent that is a nonpublic utility, and is subject to the provisions of this section and Section 2890, has violated any requirement of this article, or knowingly provided false information to the commission on matters subject to this section and Section 2890, the commission may enforce Sections 2102, 2103, 2104, 2105, 2106, 2107, 2108, 2109, 2110, 2111, and 2114 against those persons, corporations, and billing agents as if the persons, corporations, or billing agents were a public utility. Neither this authority nor any other provision of this article grants the commission jurisdiction to regulate persons or corporations or their billing agents who are not otherwise subject to commission regulation, other than as specifically set forth in this section and Section 2890.
If the commission finds that a person, corporation, or billing agent is operating in violation of any provision of this section and Section 2890, the commission may order the billing telephone company to terminate the billing and collection services for that person, corporation, or billing agent. Nothing in this section and Section 2890 precludes a billing telephone company from taking action on its own to terminate billing and collection services.
The commission shall establish rules that require each billing telephone company, billing agent, and company that provides products or services that are charged on subscribers’ telephone bills, to provide the commission with reports of complaints made by subscribers regarding the billing for products or services that are charged on their telephone bills as a result of the billing and collection services that the billing telephone company provides to third parties, including affiliates of the billing telephone company.
If the commission receives more than 100 complaints regarding unauthorized telephone charges in any 90-day period as to a person, corporation, or billing agent’s activities that are subject to Section 2890 and this section, the commission’s consumer services division shall commence a formal or informal investigation. The commission, to further the purposes of Section 2890 and this section, may change the number of complaints in any 90-day period that initiates the commencement of an investigation. This subdivision does not prohibit the commission’s consumer services division from opening any investigation it deems necessary to enforce Section 2890 or this section.
Failure by a person, corporation, or billing agent to respond to commission staff requests for information is grounds for the commission to order the billing telephone company or companies that are providing billing and collection services to cease billing and collection services for the person, corporation, or billing agent.
Persons or corporations originating charges for products or services, their billing agents, and telephone corporations billing for these products or services shall cooperate with the commission in the commission’s efforts to enforce the provisions of this article.
This section and Section 2890 do not obligate a billing telephone company to provide billing and collection services to a billing agent.
The commission may adopt rules, regulations and issue decisions and orders, as necessary, to safeguard the rights of consumers and to enforce the provisions of this article.
For the purposes of this section, “billing agent” means the clearinghouse or billing aggregator.
A telephone bill may only contain charges for products or services, the purchase of which the subscriber has authorized.
When a person or corporation obtains a written order for a product or service, the written order shall be a separate document from any solicitation material. The sole purpose of the document is to explain the nature and extent of the transaction. Written orders and written solicitation materials shall be unambiguous, legible, and in a minimum 10-point type. Written or oral solicitation materials used to obtain an order for a product or service shall be in the same language as the written order. Written orders may not be used as entry forms for sweepstakes, contests, or any other program that offers prizes or gifts.
The commission may only permit a subscriber’s local telephone service to be disconnected for nonpayment of charges relating to the subscriber’s basic local exchange telephone service, long-distance telephone service within a local access and transport area (intraLATA), long-distance telephone service between local access and transport areas (interLATA), and international telephone service.
A billing telephone company shall clearly identify, and use a separate billing section for, each person, corporation, or billing agent that generates a charge on a subscriber’s telephone bill. A billing telephone company may not bill for a person, corporation, or billing agent, unless that person, corporation or billing agent complies with paragraph (2).
Any person, corporation, or billing agent that charges subscribers for products or services on a telephone bill shall do all of the following:
Include, or cause to be included, in the telephone bill the amount being charged for each product or service, including any taxes or surcharges, and a clear and concise description of the service, product, or other offering for which a charge has been imposed.
Include, or cause to be included, for each entity that charges for a product or service, information with regard to how to resolve any dispute about that charge, including the name of the party responsible for generating the charge and a toll-free telephone number or other no cost means of contacting the entity responsible for resolving disputes regarding the charge and a description of the manner in which a dispute regarding the charge may be addressed. Each telephone bill shall include the appropriate telephone number of the commission that a subscriber may use to register a complaint.
Establish, maintain, and staff a toll-free telephone number to respond to questions or disputes about its charges and to provide the appropriate addresses to which written questions or complaints may be sent. The person, corporation, or billing agent that generates a charge may also contract with a third party, including, but not limited to, the billing telephone corporation, to provide that service on behalf of the person, corporation or billing agent.
Provide a means for expeditiously resolving subscriber disputes over charges for a product or service, the purchase of which was not authorized by the subscriber. In the case of a dispute, there is a rebuttable presumption that an unverified charge for a product or service was not authorized by the subscriber and that the subscriber is not responsible for that charge. With regard to direct dialed telecommunications services, evidence that a call was dialed is prima facie evidence of authorization. If recurring charges arise from the use of those subscriber-initiated services, the recurring charges are subject to this section.
If an entity responsible for generating a charge on a telephone bill receives a complaint from a subscriber that the subscriber did not authorize the purchase of the product or service associated with that charge, the entity, not later than 30 days from the date on which the complaint is received, shall verify the subscriber’s authorization of that charge or undertake to resolve the billing dispute to the subscriber’s satisfaction.
For purposes of this section, “billing agent” is the clearinghouse or billing aggregator.
This section shall become operative on July 1, 2001.
The commission shall, on or before July 1, 2001, adopt any additional rules it determines to be necessary to implement the billing safeguards of Section 2890, for the inclusion of noncommunications-related products and services in telephone bills.
A provider of mobile telephony services, as defined in Section 224.4, shall provide subscribers with a means by which a subscriber can obtain reasonably current and available information, as determined by the provider, on the subscriber’s calling plan or plans and service usage, including roaming usage and charges.
On or before January 1, 2007, a provider of mobile telephony services shall provide subscribers with a means by which a subscriber can obtain reasonably current and available information, as determined by the provider, on the subscriber’s text messaging and Internet usage and charges.
Each provider of mobile telephony services shall inform subscribers at the time service is established of the availability of the information described in subdivisions (a) and (b) and how it may be obtained.
ARTICLE 3. Customer Right of Privacy [2891. - 2894.10.]
A telephone or telegraph corporation shall not make available to any other person or corporation, without first obtaining the residential subscriber’s consent, in writing, any of the following information:
The subscriber’s personal calling patterns, including any listing of the telephone or other access numbers called by the subscriber, but excluding the identification to the person called of the person calling and the telephone number from which the call was placed, subject to the restrictions in Section 2893, and also excluding billing information concerning the person calling that federal law or regulation requires a telephone corporation to provide to the person called.
The residential subscriber’s credit or other personal financial information, except when the corporation is ordered by the commission to provide this information to any electrical, gas, heat, telephone, telegraph, or water corporation, or centralized credit check system, for the purpose of determining the creditworthiness of new utility subscribers.
The services that the residential subscriber purchases from the corporation or from independent suppliers of information services who use the corporation’s telephone or telegraph line to provide service to the residential subscriber.
Demographic information about individual residential subscribers, or aggregate information from which individual identities and characteristics have not been removed.
Any residential subscriber who gives their written consent for the release of one or more of the categories of personal information specified in subdivision (a) shall be informed by the telephone or telegraph corporation regarding the identity of each person or corporation to whom the information has been released, upon written request. The corporation shall notify every residential subscriber of the provisions of this subdivision whenever consent is requested pursuant to this subdivision.
Any residential subscriber who has, pursuant to subdivision (b), given written consent for the release of one or more of the categories of personal information specified in subdivision (a) may rescind this consent upon submission of a written notice to the telephone or telegraph corporation. The corporation shall cease to make available any personal information about the subscriber, within 30 days following receipt of the notice given pursuant to this subdivision.
This section does not apply to any of the following:
Information provided by residential subscribers for inclusion in the corporation’s directory of subscribers.
Information customarily provided by the corporation through directory assistance services.
Postal ZIP Code information.
Information provided under supervision of the commission to a collection agency by the telephone corporation exclusively for the collection of unpaid debts.
Information provided to an emergency service agency responding to a 911 telephone call or any other call communicating an imminent threat to life or property.
Information provided to a law enforcement agency in response to lawful process.
Information that is required by the commission pursuant to its jurisdiction and control over telephone and telegraph corporations.
Information transmitted between telephone or telegraph corporations pursuant to the furnishing of telephone service between or within service areas.
Information required to be provided by the corporation pursuant to rules and orders of the commission or the Federal Communications Commission regarding the provision over telephone lines by parties other than the telephone and telegraph corporations of telephone or information services.
The name and address of the lifeline customers of a telephone corporation provided by that telephone corporation to a public utility for the sole purpose of low-income ratepayer assistance outreach efforts. The telephone corporation receiving the information request pursuant to this paragraph may charge the requesting utility for the cost of the search and release of the requested information.
Information provided in response to a request pursuant to subdivision (a) of Section 530.8 of the Penal Code.
Every violation of this section is grounds for a civil suit by the aggrieved residential subscriber against the telephone or telegraph corporation and its employees responsible for the violation.
For purposes of this section, both of the following definitions apply:
“Access number” means a telex, teletex, facsimile, computer modem, or any other code that is used by a residential subscriber of a telephone or telegraph corporation to direct a communication to another subscriber of the same or another telephone or telegraph corporation.
“Lawful process” means an action taken pursuant to a court-ordered subpoena or judicial warrant.
Notwithstanding Section 2891, a telephone corporation selling or licensing lists of residential subscribers shall not include the telephone number of any subscriber assigned an unlisted or unpublished access number. A subscriber may waive all or part of the protection provided by this subdivision through written notice to the telephone corporation.
Notwithstanding Section 2891, a provider of mobile telephony services, or any direct or indirect affiliate or agent of a provider, providing the name and dialing number of a subscriber for inclusion in any directory of any form, or selling the contents of any directory database, or any portion or segment thereof, shall not include the dialing number of any subscriber without first obtaining the express consent of that subscriber. The express consent shall meet all of the following requirements:
It shall be one of the following:
A separate document that is signed and dated by the subscriber, and that is not attached to any other document.
An affirmative response made on a separate field on an internet website where there is no default. The provider of mobile telephony services shall send a confirmation notice to the subscriber’s electronic mail address, or to a subscriber’s postal mail address if the subscriber does not have an electronic mail account.
It shall be unambiguous, legible, and conspicuously disclose that, by opting in, the subscriber is consenting to have the subscriber’s dialing number sold or licensed as part of a list of subscribers and the subscriber’s dialing number may be included in a publicly available directory.
If, under the subscriber’s calling plan, the subscriber may be billed for receiving unsolicited calls or text messaging from a telemarketer, the provider’s form shall include an unambiguous and legible disclosure statement that, by consenting to have the subscriber’s dialing number sold or licensed as part of a list of subscribers or included in a publicly available directory, the subscriber may incur additional charges for receiving unsolicited calls or text messages.
Nothing in this section prohibits a subscriber of mobile telephony services from voluntarily entering into an agreement for the placement of the subscriber’s name and mobile telephony dialing number in any advertising program if the agreement satisfies the express consent requirements of this section.
A subscriber who provides express prior consent pursuant to subdivision (b) may revoke that consent at any time. A provider of mobile telephony services shall comply with the subscriber’s request to opt out within a reasonable period of time, not to exceed 60 days.
A subscriber shall not be charged for making the choice to not have their name and mobile telephony dialing number be listed in a publicly available directory assistance database.
This section does not apply to the provision of telephone numbers to the following parties for the purposes indicated:
To a collection agency, to the extent disclosures made by the agency are supervised by the commission, exclusively for the collection of unpaid debts.
To any law enforcement agency, fire protection agency, public health agency, public environmental health agency, city or county emergency services planning agency, or private for-profit agency operating under contract with, and at the direction of, one or more of these agencies, for the sole purpose of responding to a 911 call, communicating an imminent threat to life or property, or testing the systems that respond to 911 calls or communicate threats to life or property.
Any information or records provided to a private for-profit agency pursuant to this subdivision shall be held in confidence by that agency and by any individual employed by or associated with that agency. This information or these records shall not be open to examination for any purpose not directly connected with the administration of the services specified in subdivision (e) of Section 2872 or this paragraph.
To a lawful process issued under state or federal law.
To a telephone corporation providing service between service areas for the provision to the subscriber of telephone service between service areas, or to third parties for the limited purpose of providing billing services.
To a telephone corporation to effectuate a customer’s request to transfer the customer’s assigned telephone number from the customer’s existing provider of telecommunications services to a new provider of telecommunications services.
To the commission pursuant to its jurisdiction and control over telephone and telegraph corporations.
Every deliberate violation of this section is grounds for a civil suit by the aggrieved subscriber against the organization or corporation and its employees responsible for the violation.
For purposes of this section, “unpublished or unlisted access number” means a telephone, telex, teletex, facsimile, computer modem, or any other code number that is assigned to a subscriber by a telephone or telegraph corporation for the receipt of communications initiated by other telephone or telegraph customers and that the subscriber has requested that the telephone or telegraph corporation keep in confidence.
No telephone corporation, nor any official or employee thereof, shall be subject to criminal or civil liability for the release of customer information as authorized by this section.
Telephone subscribers shall be annually notified that use of an “800” or “900” telephone number may result in the disclosure of the subscriber’s telephone number to the called party. The commission shall, by rule or order, impose the responsibility for the notification with the telephone corporation that offers the caller identification service, often known as automatic number identification, in connection with an “800” or “900” service.
For purposes of this section, “telecommunications service” means voice communication provided by a telephone corporation as defined in Section 234, voice communication provided by a provider of satellite telephone services, voice communication provided by a provider of mobile telephony service, as defined in Section 224.4, and voice communication provided by a commercially available facilities-based provider of voice communication services utilizing Voice over Internet Protocol or any successor protocol.
The commission, in consultation with the Office of Emergency Services, shall open an investigative or other appropriate proceeding to identify the need for telecommunications service systems not on the customer’s premises to have backup electricity to enable telecommunications networks to function and to enable the customer to contact a public safety answering point operator during an electrical outage, to determine performance criteria for backup systems, and to determine whether the best practices recommended by the Network Reliability and Interoperability Council in December 2005, for backup systems have been implemented by telecommunications service providers operating in California. If the commission determines it is in the public interest, the commission shall, consistent with subdivisions (c) and (d), develop and implement performance reliability standards.
The commission, in developing any standards pursuant to the proceeding required by subdivision (b), shall consider current best practices and technical feasibility for establishing battery backup requirements.
The commission shall not implement standards pursuant to the proceeding required by subdivision (b) unless it determines that the benefits of the standards exceed the costs.
The commission shall determine the feasibility of the use of zero greenhouse gas emission fuel cell systems to replace diesel backup power systems.
The commission shall require providers of mobile telephony service, as defined in Section 224.4, to report to the commission, as specified by the commission, on activities associated with customer fraud.
Each report shall include a description of the types of fraud occurring, the amount of revenues that have been uncollectible because of fraud, and the actions undertaken by the mobile telephony service provider to combat fraud.
The commission shall require mobile telephony service providers to provide their subscribers with a notice, to be reviewed by the commission, warning subscribers about problems associated with fraud, and informing them about ways to protect against fraud.
As used in this section “public safety agency” means a “public safety agency” as defined in Section 53102 of the Government Code.
A provider of commercial mobile radio service, as defined in Section 216.8, may enter into a contract with a public safety agency to give the transmissions of public safety agency end users of that service priority over the transmissions of other persons or entities. The contract shall comply with applicable federal law.
The commission shall, by rule or order, require that every telephone call identification service offered in this state by a telephone corporation, or by any other person or corporation that makes use of the facilities of a telephone corporation, shall allow a caller to withhold display of the caller’s telephone number, on an individual basis, from the telephone instrument of the individual receiving the telephone call placed by the caller. However a caller shall not be allowed to withhold the display of the caller’s business telephone number when that number is being used for telemarketing purposes.
There shall be no charge to the caller who requests that his or her telephone number be withheld from the recipient of any call placed by the caller.
The commission shall direct every telephone corporation to notify its subscribers that their calls may be identified to a called party either:
Thirty or more days before the telephone corporation commences to participate in the offering of a call identification service.
By March 1, 1990, if the telephone corporation is participating in a call identification service prior to January 1, 1990.
This section does not apply to any of the following:
Any identification service provided in connection with legally sanctioned call tracing or tapping procedures.
Any identification service provided in connection with any “800” or “900” access code telephone service until the telephone corporation develops the technical capability to comply with subdivision (a), as determined by the commission.
Until the market for local telephone service is competitive, a telephone corporation shall not charge any subscriber for having an unlisted or unpublished telephone number. However, nothing in this subdivision shall be interpreted by the commission to reduce the revenues of telephone corporations. Any actions of the commission pursuant to this subdivision shall be implemented on a competitively neutral basis. This charge shall not be eliminated prior to the effective date upon which offsetting rates are implemented by the commission.
For purposes of this section, the following terms have the following meanings:
“Call” means the initiation of telecommunications service by accessing a number issued pursuant to the North American Numbering Plan, irrespective of whether the call is initiated using a traditional landline over the public switched telephone network, using mobile telephony service, or using interconnected VoIP service network.
“Caller” means a person or entity that places a call.
“Caller identification information,” “caller identification service,” “information regarding the origination,” and “interconnected VoIP Service” have the same meanings as defined in Section 64.1600 of Title 47 of the Code of Federal Regulations as of January 1, 2019.
“Enter” means to input data by whatever means into a computer or telephone system.
“False government information” means caller identification information that misrepresents the identity of the caller to the recipient of a call, or to the network itself, by presenting information regarding the origination of the call as being from the federal government, state government, a local government, or any agent thereof.
“Federal government” means the United States, or any agency or instrumentality of the United States.
“Local government” means any city, city and county, county, public district, public corporation, authority, agency, board, commission, or other public entity in the state.
“Phone number” means an access number issued pursuant to the North American Numbering Plan.
“Telecommunications” and “telecommunications service” have the same meanings as defined in Section 153 of Title 47 of the United States Code as of January 1, 2019.
A caller shall not enter, or cause to be entered, false government information into a caller identification system with the intent to mislead, cause harm, deceive, or defraud the recipient of the call.
A person or entity may not make a call knowing that false government information was entered into the caller identification system with the intent to mislead, cause harm, deceive, or defraud the recipient of the call.
This section does not apply to any of the following:
Any intelligence or security agency of the federal government.
A telecommunications, broadband, or interconnected VoIP service provider that is acting solely as an intermediary for the transmission of telecommunications service between the caller and the recipient.
Any person or entity that violates this section may be enjoined in any court of competent jurisdiction.
Any person or entity that knowingly violates this section shall be subject to a civil penalty of up to ten thousand dollars ($10,000) for each violation.
An action to enforce this section may be brought by a city attorney, district attorney, or the Attorney General.
If during the investigation of a complaint for possible violation of Article 1 (commencing with Section 2871), the commission determines that a violation of this section may have occurred, the commission shall notify both the district attorney of the county where the call was received and the Attorney General of the potential violation.
This section shall apply in addition to any other applicable law prohibiting the same or similar activity.
The provisions of this section are severable. If any provision of this section or its application is held invalid, that invalidity shall not affect other provisions or applications that can be given effect without the invalid provision or application.
This section shall be known, and may be cited, as the Consumer Call Protection Act of 2019.
On or before January 1, 2021, each telecommunications service provider shall implement Secure Telephony Identity Revisited (STIR) and Secure Handling of Asserted information using toKENs (SHAKEN) protocols or alternative technology that provides comparable or superior capability to verify and authenticate caller identification for calls carried over an internet protocol network.
Pursuant to the authority granted to states in Section 227 of Title 47 of the United States Code, the commission and the Attorney General may take all appropriate actions to enforce that section and any regulation promulgated under that section.
The commission may, at the request of the Attorney General, work with the Attorney General for the purposes of the enforcement of subdivisions (e) and (g) of Section 227 of Title 47 of the United States Code.
A good faith effort to comply with the requirements of subdivision (b) shall be a defense to a claim for violating this section brought pursuant to Chapter 5 (commencing with Section 17200) of Part 2 of Division 7 of the Business and Professions Code.
Notwithstanding subdivision (e) of Section 2891, the disclosure of any information by an interexchange telephone corporation, a local exchange telephone corporation, or a provider of commercial mobile radio service, as defined in Section 216.8, in good faith compliance with the terms of a state or federal court warrant or order or administrative subpoena issued at the request of a law enforcement official or other federal, state, or local governmental agency for law enforcement purposes, is a complete defense against any civil action brought under this chapter or any other law, including, but not limited to, Chapter 1.5 (commencing with Section 630) of Part 1 of Title 15 of the Penal Code, for the wrongful disclosure of that information.
As used in this section the following terms have the following meanings:
“Interexchange telephone corporation” means a telephone corporation that is a long-distance carrier.
“Local exchange telephone corporation” means a telephone corporation that provides local exchange services.
The Legislature finds and declares that a number of federal and state laws have been enacted to protect residential telephone subscribers’ privacy rights with respect to telephone solicitations. Various governmental agencies publish information that generally describes telephone subscribers’ rights under these laws. Examples of publications include the Federal Trade Commission’s brochure, “Straight Talk About Telemarketing,” and the Federal Communications Commission’s publication, “Consumer News, What You Can Do About Unsolicited Telephone Marketing Calls and Faxes.” The Legislature intends that telephone subscribers be provided with information regarding their privacy rights, under state and federal law, with respect to telephone solicitations.
Every local exchange telephone corporation shall provide its residential customers with information regarding state and federal laws that protect the privacy rights of residential telephone subscribers with respect to telephone solicitations by providing on an annual basis one or more of the following items of information in the billing statement of each residential customer and in conspicuous notices in the consumer information pages of the local telephone directories distributed by that telephone corporation:
A copy of a publication prepared by the Department of Consumer Affairs, the Public Utilities Commission, the Federal Trade Commission, or any other federal or state governmental agency that generally describes telephone subscribers’ privacy rights, under state and federal laws, with respect to telephone solicitations.
A list of the titles of the publications identified in paragraph (1) and information on how to obtain those publications.
A provider of local exchange service shall not be subject to any penalties if the provider makes a good faith effort to provide or identify the publications described in subdivision (b).
ARTICLE 4. Telecommunication Services [2895. - 2899.]
This article shall be known and may be cited as the Telecommunications Customer Service Act of 1993.
The commission shall require telephone corporations to provide customer service to telecommunication customers that includes, but is not limited to, all the following:
Sufficient information upon which to make informed choices among telecommunications services and providers. This includes, but is not limited to, information regarding the provider’s identity, service options, pricing, and terms and conditions of service. A provider need only provide information to its customers on the services which it offers.
Ability to access a live operator by dialing the numeral “0” as an available, free option. The commission may authorize rates and charges for any operator assistance service provided subsequent to access.
Reasonable statewide service quality standards, including, but not limited to, standards regarding network technical quality, customer service, installation, repair, and billing.
Information concerning the regulatory process and how customers can participate in that process, including the process of resolving complaints.
A provider of commercial mobile radio service, as defined in Section 216.8, shall provide access for end users of that service to the local emergency telephone systems described in the Warren-911-Emergency Assistance Act (Article 6 (commencing with Section 53100) of Chapter 1 of Part 1 of Division 2 of Title 5 of the Government Code). “911” shall be the primary access number for those emergency systems. A provider of commercial mobile radio service, in accordance with all applicable Federal Communication Commission orders, shall transmit all “911” calls from technologically compatible commercial mobile radio service communication devices without requiring user validation or any similar procedure. A provider of commercial mobile radio service may not charge any airtime, access, or similar usage charge for any “911” call placed from a commercial mobile radio service telecommunications device to a local emergency telephone system.
Consistent with other provisions of this code, orders, rules, and applicable tariffs of telecommunications service providers, the commission shall apply these policies to all providers of telecommunications services in California. These policies are not exclusive and may be supplemented by the commission.
Notwithstanding any other provision of this part, upon receiving a request pursuant to subdivision (b), the mobile internet service provider shall not impair or degrade the lawful internet traffic of a first response agency’s identified account until the earlier of either the time when the account is no longer being used by the agency in response to the emergency or the end of the emergency, subject to reasonable network management.
A first response agency may submit a request to a mobile internet service provider to not impair or degrade the lawful internet traffic of an account used by the agency in response to an emergency. As part of the request, the first response agency shall identify the account number and lines for the mobile internet service provider.
A first response agency that submits a request pursuant to paragraph (1) shall notify the mobile internet service provider upon the account no longer being used by the agency in response to the emergency.
For purposes of this section, the following definitions apply:
“Mobile internet service provider” has the same meaning as defined in Section 3100 of the Civil Code.
“Reasonable network management” has the same meaning as defined in Section 3100 of the Civil Code.
For purposes of this section, “incarcerated persons calling services” means communication services rendered to incarcerated persons, including, but not limited to, voice communications.
The commission shall establish service quality standards for incarcerated persons calling services to be adhered to by communication service providers rendering services to state or local correctional or detention facilities.
PART 3. SURRENDER OF MUNICIPAL CONTROL [2901. - 2976.]
CHAPTER 1. Surrender of Control by Municipal Corporations [2901. - 2976.]
ARTICLE 1. General Provisions and Definitions [2901. - 2907.]
Any municipal corporation may retain or surrender to the commission the powers of control vested in it to supervise and regulate the relationship between any one or more classes of public utilities, and their present or prospective customers, consumers, or patrons, and, if it has retained such powers over any class of public utilities, may thereafter surrender such powers to the commission.
This chapter shall not be construed to authorize any municipal corporation to surrender to the commission its powers of control to supervise and regulate the relationship between a public utility and the general public in matters affecting the health, convenience, and safety of the general public, including matters such as the use and repair of public streets by any public utility, the location of the poles, wires, mains, or conduits of any public utility, on, under, or above any public streets, and the speed of common carriers operating within the limits of the municipal corporation.
Unless the context otherwise requires, the definitions and general provisions set forth in this article govern the construction of this chapter.
“Municipal corporation” means a city and county or incorporated city.
“Legislative body” means the board of supervisors, municipal council, commission, or other legislative or governing body of a municipal corporation.
“Powers of control” means all powers of control vested in a municipal corporation to supervise and regulate (a) the relationship between public utilities and their present or prospective customers, consumers, or patrons. The term does not include the powers of control vested in any municipal corporation to supervise and regulate the relationship between such public utilities and the general public in matters affecting the health, convenience, and safety of the general public, including matters such as the use and repair of public streets by any public utility, the location of the poles, wires, mains, or conduits of any public utility, on, under, or above any public streets, and (b) the speed of common carriers operating within the limits of the municipal corporation.
“Railroad corporation,” “street railroad corporation,” “common carrier,” “gas corporation,” “electrical corporation,” “telephone corporation,” “telegraph corporation,” “water corporation,” and “public utility” have the same meaning as is given to them, respectively, in Part 1 (commencing with Section 201).
ARTICLE 2. Petition for Election [2931. - 2939.]
The question whether any municipal corporation shall retain its powers of control respecting one or more classes of public utilities may be submitted to the qualified electors of the municipal corporation, as provided in this chapter, either at a general municipal election or at a special election.
The question may be submitted, either (a) in pursuance of an ordinance of intention adopted by a vote of three-fifths of all the members of the legislative body of the municipal corporation, declaring that the public interest requires the submission of, and that it is the intention of the legislative body to submit the question to a vote of the qualified electors of the municipal corporation or (b) in pursuance of a petition of qualified electors of the municipal corporation.
The ordinance of intention or the petition, as the case may be, shall contain the propositions proposed to be so submitted, as set forth in Section 2965.
The petition shall be signed by qualified electors of the municipal corporation, equal in number to 10 per centum of the qualified electors, computed upon the total number of votes cast in the municipal corporation for all candidates for Governor at the last preceding general election prior to the filing of the petition at which a governor was elected. The petition may consist of separate papers, but if any paper consists of more than one sheet it shall be securely fastened together at the top. The signatures need not all be appended to one sheet of paper. Each paper shall have attached, at the bottom of the last sheet, the affidavit of a qualified elector of the municipal corporation, stating that all of the signatures on each sheet were made in his presence, and that to the best of his knowledge and belief each signature is a genuine signature of the person whose name purports to be subscribed.
The petition shall be filed with the clerk of the legislative body of the municipal corporation. Within 10 days from the date of the filing of the petition, the clerk shall examine the petition and ascertain from the record of the registration of the electors of the city and county, or of the county in which the municipal corporation is situated, whether the petition is signed by the requisite number of qualified electors. Upon request of the clerk, the legislative body of the municipal corporation shall authorize him to employ persons specially to assist him in the work of examining the petition and shall provide for their compensation.
Upon completion of the examination, the clerk shall forthwith attach to the petition his certificate, properly dated, showing the result of the examination. If from the examination, the clerk finds that the petition is signed by the requisite number of qualified electors, he shall certify that the petition is sufficient. If, from the examination, he finds that the petition is not signed by the requisite number of qualified electors, he shall certify to the number of qualified electors signing the petition and to the number of qualified electors required to make the petition sufficient.
If, by the certificate of the clerk, the petition is shown to be insufficient, it may be amended by filing a supplemental petition within 10 days from the date of the certificate.
The clerk shall, within 10 days from the filing of the supplemental petition, make a like examination of the supplemental petition and certify to the result of the examination as provided in Section 2936. If the certificate of the clerk shows any petition, or any petition together with a supplemental petition, to be insufficient, it shall be retained by him and kept as a public record, without prejudice, however, to the filing of a new petition to the same effect. But if, by the certificate of the clerk, any petition, or any petition together with a supplemental petition, is shown to be sufficient, the clerk shall forthwith present the petition to the legislative body of the municipal corporation.
The sufficiency or insufficiency of the petition shall not be subject to review by the legislative body. After the election held in pursuance of the petition, the sufficiency of the petition in any respect shall not be subject to judicial review or be otherwise questioned.
In any city and county having a board of election commissioners and a registrar of voters, the clerk of the legislative body thereof shall immediately upon the filing of any petition with him, transmit the petition to the board of election commissioners, who shall forthwith deliver the petition to the registrar of voters, who shall perform all the duties herein required to be performed in other municipal corporations by the clerk of the legislative body respecting the examination and certification of the petition. The registrar of voters shall, upon making his certificate, forthwith return the petition to the clerk, who shall thereupon present the petition and the attached certificate to the legislative body of the municipal corporation as provided in this article.
ARTICLE 3. Elections [2961. - 2976.]
Upon the adoption of an ordinance of intention, or the presentation of a petition, as provided in Article 2 (commencing with Section 2931), the legislative body of the municipal corporation shall, by ordinance, order the holding of a special election for the purpose of submitting to the qualified electors of the municipal corporation the propositions set forth in the ordinance of intention or in the petition, as the case may be, or the legislative body shall, by ordinance, order the submission of the propositions at a general municipal election.
A special election shall be held on the next established election date not less than 74 days after the adoption of the ordinance of intention, or the presentation of the petition to the legislative body.
Every special election held in any municipal corporation under the provisions of this chapter, shall be called by the legislative body thereof, by ordinance, which shall specify the propositions to be submitted at the election and the date thereof, and, where provision is not otherwise made by law, shall establish the election precincts and designate the polling places, and the names of the election officers for each precinct.
The ordinance shall, prior to the election, be published five times in a daily newspaper printed and published in the municipal corporation, or twice in a weekly newspaper printed and published therein, if there is no such daily newspaper. If no daily or weekly newspaper is printed and published in the municipal corporation, the clerk of the legislative body shall post a copy of the ordinance in three public places in the municipal corporation at least 10 days prior to the election.
The ballots to be used at any general municipal election or at any special election, at which is submitted the question whether a municipal corporation shall retain its powers of control respecting public utilities shall have printed thereon, in addition to the other matters required by law, those of the following propositions as are specified in the ordinance of intention or the petition:
“Proposition No. 1. Shall ______ (name of municipal corporation) retain its powers of control over railroad corporations?”
“Proposition No. 2. Shall ______ (name of municipal corporation) retain its powers of control over street railroad corporations?”
“Proposition No. 3. Shall ______ (name of municipal corporation) retain its powers of control over common carriers other than railroad and street railroad corporations?”
“Proposition No. 4. Shall ______ (name of municipal corporation) retain its powers of control over gas corporations?”
“Proposition No. 5. Shall ______ (name of municipal corporation) retain its powers of control over electrical corporations?”
“Proposition No. 6. Shall ______ (name of municipal corporation) retain its powers of control over telephone corporations?”
“Proposition No. 7. Shall ______ (name of municipal corporation) retain its powers of control over telegraph corporations?”
“Proposition No. 8. Shall ______ (name of municipal corporation) retain its powers of control over water corporations?”
“Proposition No. 9. Shall ______ (name of municipal corporation) retain its powers of control over wharfingers?”
“Proposition No. 10. Shall ______ (name of municipal corporation) retain its powers of control over warehousemen?”
To the right of or below each proposition to be voted upon, the words “Yes” and “No” shall be printed on separate lines, with voting targets. If a voter marks the voting target next to the printed word “Yes,” the voter’s vote shall be counted in favor of the retention of the powers of control of the municipal corporation. If the voter marks the voting target next to the printed word “No,” the voter’s vote shall be counted against the retention of those powers.
If the propositions specified in Section 2965 are submitted at a special election in any municipal corporation, the legislative body or other body or board charged with the duty of canvassing the returns and declaring the result of elections in the municipal corporation, shall meet at their usual place of meeting on the first Monday after the election to canvass the returns and to declare the result thereof.
Immediately upon the completion of the canvass of the returns of any special or general municipal election at which the propositions specified in Section 2965 were submitted, the legislative body or other body or board charged with the duty shall make an order declaring the result of the election upon such propositions and shall cause the results to be entered upon its minutes. The order shall show the total number of votes cast upon each proposition, and the number of votes cast respectively in favor of and against each proposition.
If it appears from the result of the election, as so declared, that a majority of the qualified electors of the municipal corporation have voted to retain the powers of control of the municipal corporation respecting any particular class of public utility, the municipal corporation is deemed to have elected to retain the powers of control respecting such class of public utility, and such powers shall be exercised by the municipal corporation until they are surrendered.
If it appears from the result of the election, as so declared, that a majority of the qualified electors voted not to retain the powers of control respecting any class of public utility, the municipal corporation is deemed to have elected not to retain the powers of control, and the powers of control shall thereafter vest in and be exercised by the commission.
Immediately upon the entry of the order declaring the result of the election, the clerk of the legislative body or the registrar of voters of any municipal corporation having a board of election commissioners and a registrar of voters, shall make copies, in duplicate, of the order, and shall attach to each copy his certificate under the seal, if any, of the municipal corporation, or of the board of election commissioners, certifying that it is a true and correct copy of the order. The clerk or registrar of voters, as the case may be, shall forthwith file one copy in the office of the commission and the other in the Office of the Secretary of State.
Immediately upon the filing of a certified copy of the order in the office of the commission, the powers of control theretofore vested in the municipal corporation over any class or classes of public utilities which a majority of the qualified electors of the municipal corporation voting thereon have voted not to retain, as shown by the order, thereupon vests in and shall be exercised by the commission.
Any municipal corporation which has retained the powers of control vested therein respecting any class or classes of public utilities may thereafter surrender its powers of control as to such class or classes of public utilities at a general municipal election, or at a special election called for that purpose.
The ballots to be used at the election shall have printed thereon, in addition to the other matters required by law, separate propositions as to each class of public utilities as to which the municipal corporation may retain its powers of control and as to which it is desired to vote. As to each of such classes of public utilities, and in addition to the other matters required by law to be printed thereon, a proposition shall be printed on the ballot to be used at the election in substantially the following form: “Shall ______ (name of municipal corporation) surrender its powers of control over ______ (here insert class of public utility) to the Public Utilities Commission?” To the right of or below each proposition to be voted upon, the words “Yes” and “No” shall be printed on separate lines, with voting targets. If a voter marks the voting target next to the printed word “Yes,” the voter’s vote shall be counted in favor of surrendering of the powers of control of the municipal corporation. If the voter marks the voting target next to the printed word “No,” the voter’s vote shall be counted against the surrendering of those powers.
The provisions of this chapter, insofar as applicable, shall govern elections called, conducted, and held under the provisions of this article and general municipal elections at which the propositions to surrender control of public utilities are submitted. If it appears from the result of the election declared as provided in this article, that a majority of the qualified electors of a municipal corporation have voted to surrender the powers of control of the municipal corporation respecting any particular class of public utility, the municipal corporation is deemed to have surrendered its powers of control as to such class of public utility to the commission, and such powers shall thereafter vest in and be exercised by the commission, as provided by law, upon the filing, in the office of the commission, of a certified copy of the order declaring the result of the election. If it appears from the result of the election, as declared, that a majority of the qualified electors have voted not to surrender the powers of control respecting any particular class of public utility, such powers of control shall continue in the municipal corporation. Such powers of control may thereafter be surrendered by the municipal corporation at any subsequent election at which the question of surrender may again be submitted under the provisions of this chapter.
The holding of a special election, or the submission of propositions at any general municipal election, under any of the provisions of this chapter, shall not be construed to preclude the holding of a subsequent special election or the subsequent submission of propositions at a general municipal election, on the question of the retention or surrender by a municipal corporation of its powers of control respecting any class of public utilities. However, not more than one such special election shall be held within any period of 12 months.
Except as otherwise in this chapter provided, the holding and conducting of elections pursuant to this chapter, the form of the ballots used, the opening and closing of the polls, the canvass of the returns, and the declaring of the result shall conform to such laws as are applicable to special municipal elections held in the municipal corporation affected.
PART 4. PRODUCTION AND TRANSMISSION OF PUBLIC UTILITY COMMODITIES AND SERVICES [3001. - 3255.]
CHAPTER 1. Gas Producers’ Cooperative Associations [3001. - 3224.]
ARTICLE 1. Definitions [3001. - 3004.]
Unless the context otherwise requires, the definitions in this article govern the construction of this chapter.
“Association” means any corporation which is organized pursuant to this chapter. An association is incorporated or organized pursuant to this chapter and is a producer of gas within the meaning of this chapter if it is functioning under, or is subject to, this chapter, regardless of whether it was originally incorporated pursuant to this chapter or was incorporated under other provisions of law.
“Member” includes members of associations without capital stock and holders of common stock in associations which are organized with shares of stock.
“Gas” means all gas produced in this state, natural or manufactured, except propane, for light, heat, or power.
ARTICLE 2. General Provisions [3021. - 3031.]
The purpose of this chapter is to do all of the following:
Promote, foster, and encourage the intelligent and orderly marketing of gas through cooperation.
Make the delivery of gas from producer to distributor as direct as can be efficiently done.
Free producers from unreasonable constraints imposed by limited access to market.
In enacting this chapter, the Legislature finds and declares as follows:
California gas production is an important part of the state’s gas supply.
The actual delivered cost of California produced gas is presently lower than the cost of alternative out-of-state and Canadian gas supplies.
California gas is produced and made available by California businesses and California taxpayers employing California workers.
California gas consumers are entitled to a “least cost supply mix” in the gas supplies made available to them for purchase.
California consumers and California producers of gas are entitled to be free of artificial constraints and unreasonable burdens on the marketing of California gas at a fair price.
Associations are “nonprofit,” since they are not organized to make profit for themselves, as such, or for their members, as such, but only for their members as producers.
Any provision of law which is in conflict with this chapter does not apply to any association.
Any exemption under any existing law which applies to gas in the possession, or under the control, of the individual producer, applies equally to gas in the possession, or under the control, of an association.
No person, corporation, or association, that is hereafter organized or doing business in this state, may use the word “cooperative” as part of its corporate name or other business name or title for gas producers’ cooperative marketing activities, unless it has complied with this chapter.
Any person, corporation, or association which is organized pursuant to any previously existing statute for the purpose of cooperatively selling gas is deemed to be organized and existing pursuant to this chapter, and this chapter applies to that person, corporation, or association.
An association is not any of the following:
A conspiracy, a combination in restraint of trade, or an illegal monopoly.
An attempt to lessen competition, to fix prices arbitrarily, or to create a combination or pool in violation of any law of this state.
A public utility for any purpose under Part 1 (commencing with Section 201).
The marketing contracts and agreements between an association and its members, and any agreements authorized in this chapter, are not illegal, in restraint of trade, or contrary to any statute which is enacted against pooling or combinations.
The General Corporation Law (Division 1 (commencing with Section 100) of Title 1 of the Corporations Code) applies to each association which is organized pursuant to this chapter, except where this chapter provides otherwise. For the purpose of associations organized without shares of stock, the members are deemed to be “shareholders” as the term is used in the General Corporation Law.
It is an unfair trade practice, and unlawful, for any gas corporation to do any of the following:
Interfere with, restrain, coerce, or boycott any person engaged in the production of gas within the state in the exercise of any right described in this chapter.
Discriminate against any person engaged in the production of gas within the state with respect to price, delivery, or other terms of purchase of gas by reason of membership in or contract with any association formed pursuant to this chapter.
Pay or loan money or give any thing of value as an inducement or reward for refusing or ceasing to belong to, or for breaching one’s membership agreement in, an association.
Maliciously or knowingly give false reports about the finances, management, or activities of any person subject to this chapter.
Refuse to negotiate or bargain at reasonable times and for reasonable periods of time with a genuine desire to reach agreement and a serious attempt to resolve differences with an association for price, terms of sale, terms of transportation, compensation for gas produced under contract, or any other contract provision relative to gas production represented by an association, except that nothing in this subdivision requires a gas corporation to reach agreement on price, delivery terms, transportation terms, compensation, or any other contract term.
ARTICLE 3. Purposes [3051. - 3051.]
Three or more natural persons, all of whom are residents of this state, who are engaged in the production of gas within this state, may form an association pursuant to this chapter for the purpose of engaging in any activity in connection with any of the following:
The selling of gas produced by its members.
The storing, handling, transportation, or utilization of gas or the manufacturing or making of byproducts of gas.
The manufacturing, selling, or supplying to its members of machinery, equipment, or supplies directly related to the production, transmission, storage, or marketing of gas.
The financing of any activity specified in this section.
The representation of its members in bargaining and negotiations concerning any sale of gas to a third party, either pursuant to an existing contract or a new contract.
ARTICLE 4. Articles of Incorporation [3061. - 3063.]
The articles of incorporation of the association shall show that the signers of the articles of incorporation are engaged in the production of gas, state that they propose to incorporate an association pursuant to this chapter, and shall state all of the following:
The name of the association.
The purposes for which it is formed.
The county where the principal office for the transaction of business of the association is to be located.
The number of directors of the association, which shall be not less than three, and the names and addresses of the persons who are to serve as the first directors. If it is desired that the first directors serve for terms of different length, the term for which each person so named shall serve shall also be stated.
If organized without shares of stock, whether the voting power and the property rights and interest of each member are equal or unequal. If voting power and property rights and interest of each member are unequal, the general rule or rules which are applicable to all members by which the voting power and the property rights and interests, respectively, of each member may be determined and fixed shall also be stated.
If organized with shares of stock, the number of shares which may be issued and, if the shares are to have a par value, the par value of each share, and the aggregate par value of all shares. If the shares are to be without par value, it shall be so stated.
If the shares of stock are to be classified, a description of the classes of shares and a statement of the number of shares of each kind or class and the nature and extent of the preferences, rights, privileges, and restrictions which are granted to, or imposed upon, the holders of the respective classes of stock.
Except as to the matters and things so stated, no distinction shall exist between the classes of stock or the holders of them. One class of stock shall always be known as common stock, and the voting power may be restricted to holders of common stock.
Articles of incorporation shall be signed, acknowledged, and filed in the manner which is prescribed by the general laws of this state for domestic corporations.
The articles of incorporation of any association may be amended in the manner and for the purposes which are authorized by the General Corporation Law (Division 1 (commencing with Section 100) of Title 1 of the Corporations Code).
ARTICLE 5. Bylaws [3081. - 3092.]
Each association shall, within 30 days after its incorporation, adopt for its government and management a code of bylaws that is not inconsistent with this chapter. The vote or written assent of the members that hold at least a majority of the voting power is necessary to adopt the bylaws and is effective to repeal or amend the bylaws or to adopt additional bylaws.
The power to repeal and amend the bylaws, and to adopt new bylaws, may, by a similar vote or similar written assent, be delegated to the board of directors, which authority may, by a similar vote or similar written assent, be revoked.
The bylaws may prescribe the time, place, and manner of calling and conducting meetings. Meetings of members shall be held at the place specified in the bylaws or, if no such provision is made, the meetings shall be held in the city where the principal place of business is located at a place designated by the board of directors. Meetings of the board of directors may be held at any place within or outside the state which is fixed by a majority of the board of directors, unless otherwise provided in the articles of incorporation or bylaws.
The bylaws may prescribe the number of stockholders or members which constitutes a quorum.
The bylaws may prescribe the right of members to vote by proxy or by mail, or both; the conditions, manner, form, and effects of their votes; the right of members to cumulate their votes; and the prohibition, if desired, of cumulative voting.
The bylaws may prescribe the number of directors which constitutes a quorum.
The bylaws may prescribe the qualifications, compensation, duties, and term of office of the directors and officers and the time of their election.
The number of directors set forth in the articles of incorporation shall be either a fixed number or a variable number. If a fixed number, it shall not be less than three. If a variable number, the stated minimum shall not be less than three and the stated maximum shall not be more than two times the stated minimum minus one.
The number of directors may also be set forth in the bylaws either as a fixed number or as a variable number subject to the same limitations as in subdivision (b). After members have been admitted, any adoption or amendment of the bylaw provision shall be subject to approval pursuant to Section 152 of the Corporations Code.
In the event of an inconsistency between an article provision referred to in subdivision (b) and a bylaw provision referred to in subdivision (c), the provision more recently adopted or amended shall prevail.
If a variable number of directors is set forth in the articles of incorporation or the bylaws, the exact number of directors shall be fixed, within the limits specified, by approval of the board of directors or by the members pursuant to Section 153 of the Corporations Code in the manner designated in the bylaws.
The bylaws may prescribe penalties for violations of the bylaws.
The bylaws may prescribe the amount of entrance, organization, and membership fees, if any; the manner and method of collection of these fees; and the purposes for which they may be used.
The bylaws may prescribe the amount which each member shall be required to pay annually, or from time to time if at all, to carry on the business of the association; the charge, if any, to be paid by each member or for services rendered by the association and the time of payment and the manner of collection; and the marketing contract between the association and its members which every member may be required to sign.
The bylaws may prescribe the amount of any dividends which may be declared on the stock or membership capital, which shall not exceed 8 percent per annum, shall be in the nature of interest, and shall not affect the nonprofit character of any association.
The bylaws may prescribe the number and qualification of members of the association and the conditions precedent to membership; the method, time, and manner of permitting members to withdraw or to transfer their stock; the manner of assignment and transfer of the interest of members; the conditions upon which, and time when, membership of any member shall cease; the automatic supsension of the rights of a member who ceases to be eligible for membership in the association; and the mode, manner, and effect of the expulsion of a member.
The bylaws may prescribe the manner of determining the value of a member’s interest and provision for its purchase by the association upon the death or withdrawal of a member or upon the expulsion of a member or forfeiture of membership or, at the option of the association, the purchase at a price fixed by conclusive appraisal by the board of directors. In case of the expulsion of a member, and where the bylaws do not provide any procedure or penalty, the board of directors shall equitably and conclusively appraise the member’s property interest in the association and shall fix the amount of that property interest in money, which shall be paid to the member within one year after expulsion.
ARTICLE 6. Directors and Management [3101. - 3110.]
The affairs of the association shall be managed by a board of not less than three directors who are elected by the members.
The bylaws may provide that the territory in which the association has members shall be divided into districts and that directors shall be elected from the several districts. In that case, the bylaws shall specify the number of directors to be elected by each district, and the manner and method of reapportioning the directors and of redistricting the territory of the association.
The bylaws may provide that primary elections shall be held to nominate directors. If the bylaws provide that the territory in which the association has members shall be divided into districts, the bylaws may also provide that the results of the primary elections in the various districts shall be final and shall be ratified at the annual meeting of the association.
The bylaws may provide that the territory in which the association has members shall be divided into districts and that the directors shall be elected by representatives or advisers, who themselves have been elected by the members from the districts. In that case, the bylaws shall specify the number of representatives or advisers to be elected by each district, and the manner and method of reapportioning the representatives or advisers and of redistricting the territory of the association.
The bylaws may provide that one or more directors may be appointed by any public official or commission or by the other directors selected by the members. These directors so appointed shall represent primarily the interest of the general public. These directors shall have the same powers and rights as the other directors. The directors so chosen shall not number more than one-fifth of the entire number of directors.
The bylaws may provide for an executive committee and may delegate to the committee all the functions and powers of the board of directors, subject to the general direction and control of the board.
The association may provide a fair remuneration for the time which is actually spent by its officers and directors in its service and for the service of the members of its executive committee.
If a vacancy on the board of directors occurs except by expiration of a term, the remaining members of the board, by a majority vote, shall fill the vacancy unless the bylaws provide for an election of directors by districts. If the bylaws provide for an election of directors by districts, the vacancy shall be filled by the election of a director from the district in which the vacancy occurs or the board may call a special meeting of the members in that district to fill the vacancy.
The directors shall elect a president, one or more vice presidents, a secretary, a treasurer, and any other officers that may be prescribed by the bylaws. Any two or more offices, except those of president and secretary, may be held by the same person.
The treasurer may be a bank or any depository and, as such, shall not be considered an officer, but a function of the board of directors. In that case, the secretary shall perform the usual accounting duties of the treasurer, except that the funds shall be deposited only, as, and where authorized by the board.
Any member may bring charges against an officer or director by filing them, in writing, with the secretary of the association, together with a petition which is signed by 5 percent of the members, which requests the removal of the officer or director in question. The removal shall be voted upon at the next regular or special meeting of the association and, by a vote of a majority of the members, the association may remove the officer or director and fill the vacancy. The director or officer against whom charges have been brought shall be informed, in writing, of the charges prior to the meeting and shall have an opportunity at the meeting to be heard in person or by counsel and to present witnesses. The person bringing the charges against the director or officer shall have the same opportunity.
If the bylaws provide for election of directors by districts with primary elections in each district, the petition for removal of a director shall be signed by 20 percent of the members that reside in the district from which the director was elected. The board of directors shall call a special meeting of the members that reside in that district to consider the removal of the director and, by a vote of the majority of the members of that district, the director in question shall be removed from office.
ARTICLE 7. Powers [3121. - 3131.]
An association may engage in any activity in connection with the selling, transporting, or storing of gas which is produced and delivered to it by its members; in any activity in connection with the purchase, hiring, or use by its members of supplies, machinery, or equipment directly related to the production, transmission, storage, or marketing of gas, or in the financing of any of these activities; or in any one or more of the activities which are specified in this section.
An association may borrow without limitation as to amount of corporate indebtedness or liability and may make advances to members.
An association may purchase or otherwise acquire, hold, own, and exercise all rights of ownership in, sell, transfer, pledge, or guarantee the payment of dividends or interest on, or the retirement or redemption of, shares of the capital stock or bonds of any corporation or association which is engaged in the production of gas or any related activity.
An association may establish reserves and invest the funds of the reserves in bonds or in any other property as may be provided in the bylaws.
An association may buy, hold, and exercise all privileges of ownership of real or personal property as may be necessary or convenient for the conduct and operation of, or incidental to, any business of the association. Without limiting the foregoing, an association may acquire a real property easement from a public utility for the purpose of accommodating the association’s gas plant, and the easement shall be deemed to be held for a public purpose by the association, provided that the commission finds that the use by the association is in the public interest.
An association may levy assessments in the manner and in the amount as may be provided in its bylaws.
An association may do all of the following:
Do each and every thing which is necessary, suitable, or proper for the accomplishment of any of the purposes, or the attainment of any of the objects, specified in this chapter, or conducive to or expedient for the interest or benefit of the association, and contract accordingly.
Exercise and possess all powers, rights, and privileges which are necessary or incidental to the purposes for which the association is organized or to the activities in which it is engaged.
Have any other rights, powers, and privileges which are granted by the laws of this state to other corporations, except those which are inconsistent with this chapter.
An association may organize, form, operate, own, control, and have an interest in, own stock of, or be a member of any other corporation, with or without capital stock, which is engaged in producing, transporting, or selling of gas.
An association may, upon resolution adopted by its board of directors, enter into all necessary and proper contracts and agreements and make all necessary and proper stipulations, agreements, contracts, and arrangements with any other cooperative or other corporation or association, which is formed in this or in any other state, for the cooperative and more economical carrying on of its business or any part of its business.
Any two or more associations may, by agreement between them, unite in employing and using, or may separately employ and use, the same personnel, methods, means, and agencies for carrying on and conducting their respective business.
ARTICLE 8. Financial Provisions [3151. - 3154.]
Any share or membership issued by an association is exempt from Part 2 (commencing with Section 25100) of Division 1 of Title 4 of the Corporations Code if the aggregate investment of a shareholder or member in shares or memberships sold by an association does not exceed one thousand dollars ($1,000).
This exemption does not apply to the shares or memberships in an association if any promoter of those shares or memberships expects or intends to make a profit directly or indirectly from any business or activity associated with the association or from the operation of the association or to receive a salary or other remuneration from the association. Furthermore, this exemption does not apply to nonvoting shares or memberships in an association issued to any person who does not possess, and who will not acquire in connection with the issuance of nonvoting memberships, voting power in the association.
If an association issues nonpar value stock, the issuance of that stock shall be governed by the terms of all general laws which cover the issuance of nonpar value stock in domestic corporations.
If an association with preferred shares of stock purchases the stock or any property, or any interest in any property, of any person, it may discharge the obligations which are so incurred, in whole or in part, by exchanging for the acquired interest, shares of its preferred stock to an amount which at par value would equal the fair market value of the stock or interest so purchased, as determined by the board of directors. In that case, the transfer to the association of the stock or interest which is purchased is equivalent to payment in cash for the shares of stock which are issued.
The board of directors of an association shall cause to be sent to the members of the association, not later than 120 days after the close of the fiscal or calendar year, an annual report of the operations of the association, unless that report is expressly dispensed with in the bylaws.
If required by the bylaws, interim reports of the operations of the association for the three month, six month, or nine month periods of the current fiscal year of the association shall be furnished to the members of the association.
The annual report and any interim reports shall include a balance sheet as of the closing date. The financial statement shall be prepared from, and be in accordance with, the books. It shall be prepared in a form consistent with generally accepted accounting principles or in consultation with a certified public accountant or a public accountant.
ARTICLE 9. Members [3171. - 3181.]
Under the terms and conditions which are prescribed in the bylaws adopted by it, an association may admit as members or issue common stock to only those persons engaged in the production of gas which is to be handled by or through the association, or that use or employ any service or facility offered by the association on, or in connection with, land which is used for the production of gas, including the lessees and tenants of land which is used for the production of gas and any lessors, including any lessors, sublessors, or landlords that received as royalty, overriding royalty or rent, all or part of the gas or the value thereof, which is produced on the leased premises, and landlords that receive as rent all or part of the gas which is produced on the leased premises.
If a member of a nonstock association is other than a natural person, that member may be represented by any individual, associate, officer, manager, or member of it who is authorized in writing to do so.
Any association may become a member or stockholder of any other association.
If a member of an association which is established without shares of stock has paid the prescribed membership fee in full, the member shall receive a certificate of membership.
An association shall not issue a certificate for stock to a member until it has been fully paid for. The promissory notes of the members may be accepted by the association as full or partial payment. The association shall hold the stock as security for the payment of the note, but that retention as security does not affect the member’s right to vote.
An association, in its bylaws, may limit the amount of common stock which any member may own.
The bylaws shall prohibit the transfer of the common stock or membership certificates of the associations to any person that is not qualified to be a shareholder or member, as specified in this chapter. These restrictions shall be printed upon every certificate of stock or membership which is subject to them.
The association may, at any time, as specified in the bylaws, except when the debts of the association exceed 50 percent of its assets, buy in or purchase its common stock at the book value of the common stock, as conclusively determined by the board of directors, and pay for it in cash within one year thereafter.
A member is not liable for the debts of the association in an amount which exceeds the sum which remains unpaid on the member’s or stockholder’s membership fee or subscription to the capital stock, including any unpaid balance on any promissory note which is given in payment of the membership fee or the subscription to the capital stock.
No public utility, corporation holding a controlling interest in a public utility, or subsidiary or affiliate of a public utility may be a member of an association organized pursuant to this chapter.
No producer of gas owning or controlling petroleum refining capacity of 100,000 or more barrels per day in California, or a producer of gas owned or controlled by a producer of gas owning or controlling petroleum refining capacity of 100,000 or more barrels per day in California, may be a member of an association organized pursuant to this chapter.
ARTICLE 10. Marketing Contracts [3201. - 3206.]
The association and its members may make and execute marketing contracts which require the members to sell, for any period of time not to exceed the productive life of the gas facilities or supplies, all or any specified part of any gas produced by the members exclusively to or through the association or any facilities of the association. If the members contract a sale to the association, title to the gas passes absolutely and unreservedly, except for recorded liens, to the association upon delivery or at any other specified time which is expressly and definitely agreed in the contract.
The contract may provide that the association may sell or resell any gas which is delivered by its members, with or without taking title to the gas, and pay over to its members the resale price, after deducting all of the following:
Necessary selling, overhead, and other costs and expenses, including interest on preferred stock, not exceeding 8 percent per annum, and reserves for retiring the stock, if any.
Other proper reserves.
Interest not exceeding 8 percent per annum upon common stock.
Notwithstanding any provision of the Civil Code, a contract which is entered into by a member of an association which provides for the delivery to the association of any gas produced by the member may be specifically enforced by the association to secure the delivery to it of that gas.
The bylaws or the marketing contract may fix, as liquidated damages, specific sums to be paid by the member to the association for the breach of any provision of the marketing contract regarding the sale or delivery or withholding of gas and may provide that the member will pay all costs, premiums for bonds, expenses, and fees, if any action is brought upon the contract by the association. These provisions are valid and enforceable in the courts of this state. Provisions for liquidated damages are enforceable as such and shall not be regarded as penalties.
If there is a breach or threatened breach of a marketing contract by a member, the association may file an action for an injunction to prevent the further breach of the contract and for a decree of specific performance of the contract. Pending the adjudication of that action and upon filing a verified complaint which shows the breach or threatened breach, and upon filing a sufficient bond, the association shall be issued a temporary restraining order and preliminary injunction against the member.
In any action upon a marketing agreement, it is conclusively presumed that a landowner, landlord, or lessor is able to control the delivery of any gas which is produced on his or her land by the tenants or others, whose tenancy or possession on the land, or the terms of whose tenancy or possession on the land were created or changed after execution by the landowner, landlord, or lessor of the marketing agreement. In that action, the remedies for nondelivery or breach which are provided by this article are enforceable against the landowner, landlord, or lessor.
ARTICLE 11. Reorganization of Corporations Organized Pursuant to Other Laws [3221. - 3224.]
Any corporation which is organized or existing pursuant to any other law may be brought under this chapter by amending its articles of incorporation, in the manner which is prescribed by the general corporation laws, to conform to this chapter. If any corporation amends its articles of incorporation to conform to this chapter, it is deemed to be organized and existing pursuant to, entitled to the benefit of, and subject to, this chapter for all purposes and as fully as though it had been originally organized pursuant to this chapter.
Articles of incorporation are deemed to conform to this chapter within the meaning of Section 3291 in both of the following cases:
It is provided or declared in the articles of incorporation, in substance, regardless of form, that the corporation is organized and exists as a nonprofit cooperative corporation for the purposes which are provided for in, or permitted by, this chapter, or one or more of those purposes.
It clearly appears from the articles of incorporation that the corporation desires to be subject to, and to be organized, exist, and function pursuant to, this chapter.
If the amended articles conform, as provided in Section 3222, provisions in the articles of incorporation that appeared in the original articles or some previous amended articles are ineffective if, and to the extent that, they are inapplicable to, or inconsistent with, this chapter.
This article applies retrospectively as well as prospectively, and may be availed of by a corporation regardless of the time of incorporation, whether prior or subsequent to the adoption of this article, and shall apply to amendments to articles of incorporation whether made prior or subsequent to the adoption of this article, and all amendments made prior to the adoption of this article shall be effective and valid to the same extent as though made subsequent to the adoption of this article.
CHAPTER 2. Gas Producer Acquisition of Easement Rights [3250. - 3255.]
ARTICLE 1. Definitions [3250. - 3252.]
Unless the context otherwise requires the definitions in this article govern the construction of this chapter.
“Person” means an individual, partnership, limited liability company, or corporation, but does not include an association, as defined in Section 3002.
“Natural gas” means all gas produced in this state, natural or manufactured, except propane, for light, heat, or power.
ARTICLE 2. Acquisition of Easement Rights [3255. - 3255.]
A person involved in the production of natural gas may buy, hold, and exercise all privileges of ownership of real or personal property as may be necessary or convenient for the conduct and operation of, or incidental to, transmission of natural gas. Without limiting the foregoing, a person involved in the production of natural gas may acquire a real property easement from a public utility for the purpose of accommodating the person’s gas plant, and the easement shall be deemed to be held for a public purpose by the person, provided that the commission finds that the use by the person is in the public interest.
Within 10 days of submitting an application to the commission for an order authorizing a public utility to transfer a real property easement to a person, the public utility shall provide written notification of the application and of the commission’s pending review of the application, to each owner of real property affected by the easement. Costs of notification required by this subdivision shall be paid by the person to whom the public utility proposes to transfer a real property easement.
PART 5. GENERAL PROVISIONS [3260. - 3260.]
Nothing in this division prohibits payments pursuant to an agreement authorized by the National Labor Relations Act (29 U.S.C. Sec. 151 et seq.), or payments permitted by the federal Labor Management Cooperation Act of 1978 (29 U.S.C. Secs. 173, 175a, and 186). Nothing in this division restricts any use permitted by federal law of money paid pursuant to these acts.
PART 6. Wildfire [3280. - 3299.100.]
CHAPTER 1. Definitions [3280. - 3280.]
For purposes of this part, all of the following definitions apply:
“Account assets” means the sum of all moneys and invested assets held in the account, which shall include, without limitation, any loans or other investments made by the state to the account, all interest or other income from the investment of money held in the account, any other funds specifically designated for the account by applicable law, the proceeds of any special charge or continuation of existing charge allocated to and deposited into the account, reinsurance, and the proceeds of any bonds issued for the benefit of the account. This subdivision shall become operative upon all large electrical corporations electing to participate in the account pursuant to Section 3299.
“Administrator” means the Wildfire Fund Administrator appointed pursuant to Section 8899.72 of the Government Code.
“Annual contribution” means either of the following:
For an electrical corporation that qualifies as a large electrical corporation at the end of the prior calendar year, an amount equal to three hundred million dollars ($300,000,000) multiplied by the Wildfire Fund allocation metric.
For an electrical corporation that qualifies as a regional electrical corporation at the end of the prior calendar year, an amount equal to twenty-five dollars ($25) multiplied by the number of customer accounts serviced by the electrical corporation within the state at the end of that calendar year.
For purposes of Chapter 4 (commencing with Section 3298) and Chapter 5 (commencing with Section 3299), for a large electrical corporation, the amount determined pursuant to Section 3299.3. This paragraph shall become operative upon all large electrical corporations electing to participate in the account pursuant to Section 3299.
“Council” means the California Catastrophe Response Council created pursuant to Section 8899.70 of the Government Code.
For purposes of Chapter 2 (commencing with Section 3281) and Chapter 3 (commencing with Section 3291), “covered wildfire” has the same meaning as set forth in Section 1701.8. This subparagraph shall become inoperative upon all large electrical corporations electing to participate in the account pursuant to Section 3299.
For purposes of Chapter 2 (commencing with Section 3281) and Chapter 3 (commencing with Section 3291), “covered wildfire” means a wildfire ignited before the effective date of this subparagraph and that meets the requirements of subparagraph (A) or (B) of paragraph (1) of subdivision (a) of Section 1701.8. This subparagraph shall become operative upon all large electrical corporations electing to participate in the account pursuant to Section 3299.
For purposes of Chapter 4 (commencing with Section 3298) and Chapter 5 (commencing with Section 3299), “covered wildfire” means a wildfire ignited on or after the effective date of this paragraph and that meets the requirements of subparagraph (A) or (B) of paragraph (1) of subdivision (a) of Section 1701.8. This paragraph shall become operative upon all large electrical corporations electing to participate in the account pursuant to Section 3299.
“Electrical corporation” has the same meaning as set forth in Section 218.
“Eligible claims” means claims for third-party damages against an electrical corporation resulting from covered wildfires exceeding the greater of (1) one billion dollars ($1,000,000,000) in the aggregate in any year, or (2) the amount of the insurance coverage required to be in place for the electrical corporation pursuant to Section 3293 or 3299.4, as appropriate, measured by the amount of that excess.
“Fund” means the Wildfire Fund created pursuant to Section 3284.
“High fire-threat district” means areas identified as tier 2 (elevated) or tier 3 (extreme) fire risk on the fire-threat map maintained by the commission.
“Initial contribution” means either of the following:
For a large electrical corporation, an amount equal to seven billion five hundred million dollars ($7,500,000,000) multiplied by the Wildfire Fund allocation metric.
For a regional electrical corporation, an amount equal to six hundred twenty-five dollars ($625) multiplied by the number of customer accounts serviced by the electrical corporation within the state as of July 12, 2019.
“Insolvency proceeding” means a bankruptcy, insolvency, liquidation, reorganization, or similar proceeding brought pursuant to Title 11 of the United States Code.
“Large electrical corporation” means an electrical corporation with 250,000 or more customer accounts within the state.
“Regional electrical corporation” means an electrical corporation with less than 250,000 customer accounts within the state.
“Wildfire Fund allocation metric” means, for each large electrical corporation, the arithmetic average of (1) the land area of the electrical corporation’s territory, measured in square miles, in the high fire-threat districts as a proportion of all large electrical corporations’ territory in the high fire-threat districts and (2) the electrical corporation’s line miles of transmission and distribution lines in the high fire-threat districts as a proportion of all large electrical corporations’ line miles of transmission and distribution lines in the high fire-threat districts. The large electrical corporations’ averages shall then be adjusted to account for risk mitigation efforts. This adjustment shall reduce the allocation to electrical corporations that have invested historically in mitigation efforts and those allocations shall be reallocated to the other electrical corporations based on their proportionate share resulting from the initial calculation above. The Wildfire Fund allocation metric shall be determined by the Director of Finance no later than July 17, 2019. It is the expectation of the Legislature that the Wildfire Fund allocation metric is 64.2 percent for Pacific Gas and Electric Company, 31.5 percent for Southern California Edison Company, and 4.3 percent for San Diego Gas and Electric Company. If a new electrical corporation that is a large electrical corporation is admitted to the Wildfire Fund, the administrator shall promptly determine and publish a revised Wildfire Fund allocation metric based on the factors set forth in this subdivision.
“Wildfire Fund assets” means the sum of all moneys and invested assets held in the fund, which shall include, without limitation, any loans or other investments made by the state to the fund, all interest or other income from the investment of money held in the fund, any other funds specifically designated for the fund by applicable law, the proceeds of any special charge or continuation of existing charge allocated to and deposited into the fund, reinsurance, and the proceeds of any bonds issued for the benefit of the fund.
CHAPTER 2. The Wildfire Fund [3281. - 3289.]
The administrator shall carry out the duties of this part and may do all of the following, subject to the oversight of the council:
Retain, employ, or contract with officers, experts, employees, accountants, actuaries, financial professionals, and other executives, advisers, consultants, attorneys, and professionals as may be necessary in the administrator’s judgment for the efficient operation and administration of the fund.
Enter into contracts and other obligations relating to the operation, management, and administration of the fund.
Invest the moneys in the fund in those securities eligible under Section 16430 of the Government Code.
Review and approve claims and settlements, and provide funds to the participating electrical corporations for the purposes of paying eligible claims.
Buy insurance or take other actions to maximize the claims-paying resources of the fund.
Pay costs, expenses, and other obligations of the fund from Wildfire Fund assets.
Take any actions necessary to collect any amounts owing to the fund from participating electrical corporations.
Undertake such other activities as are related to the operation, management, and administration of the fund, as approved by the council.
There shall be a limited civil immunity, and no criminal liability in a private capacity, on account of any act performed or omitted or obligation entered into in an official capacity, when done or omitted in good faith and without intent to defraud, on the part of the counsel, the administrator, or on the part of any officer, employee, or agent of the fund. The State of California shall have no liability for payment of claims in excess of funds available pursuant to this part. The State of California, and any of the funds of the State of California, shall have no obligations whatsoever for payment of claims or costs arising from this part, except as specifically provided in this part.
The administrator shall prepare and submit to the council an annual report on the operations, financial condition, and activities of the fund and the account that includes, but is not limited to, all of the following:
The Wildfire Fund assets and the account assets.
Projections for the durability of the fund and the account.
Information on claims received and paid.
Summary of actions of the council or the administrator.
A plan for winding up the fund or the account if projections demonstrate that the Wildfire Fund assets or the account assets will be exhausted within the next three years.
Notwithstanding Section 10231.5 of the Government Code, upon approval of the council, the report shall be submitted no later than August 15 of each year to the appropriate policy committees of the Legislature.
The report required by paragraph (1) shall be submitted in accordance with Section 9795 of the Government Code.
There is hereby created the Wildfire Fund, which is not a fund in the State Treasury.
Notwithstanding Section 13340 of the Government Code, the fund is continuously appropriated without regard to fiscal years for the purposes of this part.
The fund shall be administered by the administrator, subject to the direction of the council, in accordance with Chapter 3 (commencing with Section 3291) to provide funds to participating electrical corporations to satisfy eligible claims arising from a covered wildfire in accordance with this part.
At the discretion of the administrator, segregated, dedicated accounts within the fund may be established.
Uninvested moneys in the fund may be deposited from time to time in financial institutions authorized by law to receive deposits of public moneys or, with the approval of the Treasurer, the Surplus Money Investment Fund as provided in Article 4 (commencing with Section 16470) of Chapter 3 of Part 2 of Division 4 of Title 2 of the Government Code.
A national bank shall be custodian of all securities belonging to the fund, except as otherwise provided in the constituent instruments that define the rights of the holders of the bonds as set forth in Division 28 (commencing with Section 80500) of the Water Code.
With the approval of the council, the administrator shall establish and approve procedures for the review, approval, and timely funding of eligible claims. The procedures may be revised from time to time by the administrator with the approval of the council. The procedures may include processes to facilitate and expedite the review and approval of settled eligible claims, including guidelines for, or preapproval of, settlement levels. The procedures shall provide for the reimbursement of eligible claims within 45 days of the date the administrator approves the settlement amount for any eligible claim unless that timing is not practicable.
The fund shall be initially capitalized by a loan from the state’s Surplus Money Investment Fund pursuant to Section 3288.
Proceeds of any bonds issued as provided in Division 28 (commencing with Section 80500) of the Water Code shall be used as provided in Section 80550 of the Water Code. Any proceeds from the bonds allocated to the fund shall be deposited into a segregated account within the fund.
All of the following shall be deposited into the fund:
Initial contributions from electrical corporations.
Annual contributions from electrical corporations.
Revenues generated from the ratepayers of each large electrical corporation by a charge authorized by the commission pursuant to subparagraph (A) of paragraph (1) of subdivision (a) of Section 3289 as provided in paragraph (4) of subdivision (b) of Section 80550.
Proceeds of bonds allocated to the fund as provided in Section 80550 of the Water Code.
The Director of Finance may, at any time, examine the books and records of the council and the administrator relating to the operation, management, and administration of the fund.
If Section 3291 is operative, the Director of Finance, in consultation with the Treasurer and the administrator, shall determine the amount and timing of moneys needed to support the purposes of this part. The Director of Finance shall request those moneys from the Controller. Upon that request, the Controller shall transfer up to ten billion five hundred million dollars ($10,500,000,000) to the fund from the Surplus Money Investment Fund and other funds that accrue interest to the General Fund as a cash loan. The loan principal and interest shall be fully repaid as provided in subdivision (b) of Section 80550 of the Water Code.
If Section 3292 is operative, the Director of Finance, in consultation with the Treasurer and the administrator, shall determine a schedule to provide ten billion five hundred million dollars ($10,500,000,000) to the fund and shall provide that schedule to the Controller within 60 days. The Controller shall transfer the moneys from the Surplus Money Investment Fund and other funds that accrue interest to the General Fund pursuant to the schedule provided by the Director of Finance as a loan to support the purposes of this part. The loan from the Surplus Money Investment Fund is intended to provide necessary cash on a short-term basis for claims-paying resources. It is the intent of the Legislature that the loan be repaid as quickly as possible within a fiscal year. The loan shall be repaid by the proceeds of the charges authorized pursuant to subparagraph (A) of paragraph (1) of subdivision (a) of Section 3289 or the proceeds of any bonds as set forth in Division 28 (commencing with Section 80500) of the Water Code.
In the case of subdivision (a) or (b), interest payments on outstanding loan amounts shall be calculated at the greater of the quarter-to-date yield at the one-year constant maturity United States Treasury rate for the calendar quarter concluded directly before the calculation or the Surplus Money Investment Fund rate at the time of the cash transfer. The interest payments shall be paid on a quarterly basis from Wildfire Fund assets following the cash transfer and shall continue until the loan has been fully repaid. The interest payments are interest earnings of the Surplus Money Investment Fund and shall be apportioned pursuant to Sections 16475 and 16480.6 of the Government Code.
Prior to a transfer being made from the Surplus Money Investment Fund pursuant to subdivision (a) or (b), the Director of Finance shall determine if the transfer would result in the General Fund’s estimated cash and unused borrowable resources declining below three billion dollars ($3,000,000,000) at any point in time over the succeeding 24-month period. If the Director of Finance determines that the transfer would result in estimated cash and unused borrowable resources declining below that level, the transfer of funds from the Surplus Money Investment Fund shall not be made. This subdivision shall not apply to the first two billion dollars ($2,000,000,000) of transfers made in the 2019–20 fiscal year.
No later than July 26, 2019, the commission shall initiate a rulemaking proceeding to consider using its authority pursuant to Section 701 to require each electrical corporation, except a regional electrical corporation that chooses not to participate in any fund pursuant to Chapter 3 (commencing with Section 3291), to collect a nonbypassable charge from ratepayers of the electrical corporation to support the fund, including the payment of any bonds issued pursuant to Division 28 (commencing with Section 80500) of the Water Code, as follows:
For a large electrical corporation, a charge in an amount sufficient to fund the revenue requirement, as established pursuant to Section 80524 of the Water Code.
For a regional electrical corporation, the amount equal to one-half cent per kilowatt-hour ($0.005/kWh).
If the commission determines that the imposition of the charge described in paragraph (1) is just and reasonable, and that it is appropriate to exercise its authority pursuant to Section 701 to do so, the commission shall direct each electrical corporation to impose and collect that charge commencing in the month immediately following the month in which the final imposition of the revenue requirement with respect to bonds previously issued pursuant to Division 27 (commencing with Section 80000) of the Water Code is made. The charge shall be collected in the same manner as that for the payments made to reimburse the Department of Water Resources pursuant to Division 27 (commencing with Section 80000) of the Water Code.
Notwithstanding any other law, no later than 90 days after the initiation of the rulemaking proceeding, the commission shall adopt a decision regarding the imposition of the charge.
If the administrator authorizes Golden State Energy to participate in the fund pursuant to subdivision (d) of Section 3292, Golden State Energy’s ratepayers shall be subject to the nonbypassable charge previously imposed by the commission pursuant to this section.
CHAPTER 3. Operation of the Fund [3291. - 3297.]
The fund shall be established as a revolving liquidity fund that will pay eligible claims as provided in subdivision (c) and obtain reimbursement from electrical corporations as set forth in subdivision (d).
Except as provided in subdivision (e), to participate in the fund established pursuant to subdivision (a), an electrical corporation must meet the following conditions by no later than June 30, 2020:
The electrical corporation is not, and has not been since July 12, 2019, the subject of an insolvency proceeding or on criminal probation unless the electrical corporation meets the following conditions:
The electrical corporation’s insolvency proceeding has been resolved pursuant to a plan or similar document not subject to a stay.
The bankruptcy court or a court of competent jurisdiction, in the insolvency proceeding, has determined that the resolution of the insolvency proceeding provides funding or establishes reserves for, provides for assumption of, or otherwise provides for satisfying any prepetition wildfire claims asserted against the electrical corporation in the insolvency proceeding in the amounts agreed upon in any pre-insolvency proceeding settlement agreements or any post-insolvency settlement agreements, authorized by the court through an estimation process or otherwise allowed by the court.
The commission has approved the reorganization plan and other documents resolving the insolvency proceeding, including the electrical corporation’s resulting governance structure, as being acceptable in light of the electrical corporation’s safety history, criminal probation, recent financial condition, and other factors deemed relevant by the commission.
The commission has determined that the reorganization plan and other documents resolving the insolvency proceeding are (i) consistent with the state’s climate goals as required pursuant to the California Renewables Portfolio Standard Program and related procurement requirements of the state and (ii) neutral, on average, to the ratepayers of the electrical corporation.
The commission has determined that the reorganization plan and other documents resolving the insolvency proceeding recognize the contributions of ratepayers, if any, and compensate them accordingly through mechanisms approved by the commission, which may include sharing of value appreciation.
For a regional electrical corporation, it shall have requested to participate and have established a charge required by the commission pursuant to Section 3289. The charge shall be included on monthly bills for customers. Collections on that charge shall be remitted, on a monthly basis, to the administrator for deposit into the fund.
A participating electrical corporation may seek payment from the fund to satisfy settled or finally adjudicated eligible claims. Only eligible claims shall be made against or paid by the fund. In accordance with the procedures established by the administrator, the administrator shall review and approve any settlement of an eligible claim as being in the reasonable business judgment of the electrical corporation before releasing funds to the electrical corporation for payment. To the extent approved by the administrator, the settlement shall not be subject to further review by the commission.
Within six months after the commission adopts a decision in an application filed pursuant to Section 1701.8, the electrical corporation shall reimburse the fund for the full amount of payments received from the fund. The electrical corporation may recover in rates those costs and expenses allowed by the commission pursuant to Section 451 or 451.1, as applicable.
The administrator may authorize an electrical corporation that is formed after July 12, 2019, to participate in the fund if the administrator determines that the electrical corporation meets the requirements of this section, other than the requirement that the conditions be met by June 30, 2020. The authorization shall be effective as of a date determined by the administrator and shall apply to covered wildfires after the date of authorization.
The fund shall terminate when the administrator determines that the fund is no longer necessary to serve the purposes of this part. Upon the determination of the administrator that the fund shall be terminated, the administrator shall pay all remaining eligible claims and fund expenses, liquidate any remaining assets, and refund the remaining funds to ratepayers.
This section shall become inoperative upon timely payment of the initial contribution pursuant to Section 3292 by each large electrical corporation not subject to an insolvency proceeding on July 12, 2019, and is repealed on January 1 of the following year. The administrator shall notify the Secretary of State as to whether those payments were timely made.
If, no later than July 27, 2019, each large electrical corporation not subject to an insolvency proceeding on July 12, 2019, notifies the commission of its commitment to provide the initial contribution and the annual contributions, and subsequently provides its initial contribution as set forth in paragraph (3) of subdivision (b), the fund shall be established to pay eligible claims as set forth in subdivision (f) and obtain reimbursement from electrical corporations as set forth in subdivision (h).
Except as provided in subdivision (d), to participate in the fund established pursuant to subdivision (a), an electrical corporation shall satisfy the following conditions by no later than June 30, 2020:
The electrical corporation is not, and has not been since July 12, 2019, the subject of an insolvency proceeding or on criminal probation unless the electrical corporation meets the following conditions:
The electrical corporation’s insolvency proceeding has been resolved pursuant to a plan or similar document not subject to a stay.
The bankruptcy court or a court of competent jurisdiction, in the insolvency proceeding, has determined that the resolution of the insolvency proceeding provides funding or establishes reserves for, provides for assumption of, or otherwise provides for satisfying any prepetition wildfire claims asserted against the electrical corporation in the insolvency proceeding in the amounts agreed upon in any pre-insolvency proceeding settlement agreements or any post-insolvency settlement agreements, authorized by the court through an estimation process or otherwise allowed by the court.
The commission has approved the reorganization plan and other documents resolving the insolvency proceeding, including the electrical corporation’s resulting governance structure as being acceptable in light of the electrical corporation’s safety history, criminal probation, recent financial condition, and other factors deemed relevant by the commission.
The commission has determined that the reorganization plan and other documents resolving the insolvency proceeding are (i) consistent with the state’s climate goals as required pursuant to the California Renewables Portfolio Standard Program and related procurement requirements of the state and (ii) neutral, on average, to the ratepayers of the electrical corporation.
The commission has determined that the reorganization plan and other documents resolving the insolvency proceeding recognize the contributions of ratepayers, if any, and compensate them accordingly through mechanisms approved by the commission, which may include sharing of value appreciation.
For a regional electrical corporation, it has voluntarily established a charge required by the commission pursuant to Section 3289. This charge shall be included on monthly bills for customers. Collections on that charge shall be remitted, on a monthly basis, to the administrator for deposit into the fund.
Except as provided in subdivision (e), the electrical corporation has provided its initial contribution to the fund no later than September 10, 2019. Initial contributions shall not be recovered from the ratepayers of an electrical corporation, except Golden State Energy.
Each participating electrical corporation shall make its annual contribution by January 1 of each calendar year, including, without limitation, any annual contributions for calendar years in which the electrical corporation, or another electrical corporation to which the electrical corporation is the successor, was not a participating electrical corporation. Annual contributions shall not be recovered from the ratepayers of an electrical corporation, except Golden State Energy.
An electrical corporation that is the subject of an insolvency proceeding on July 12, 2019, that wishes to participate in the fund shall (1) no later than July 27, 2019, provide written notification to the commission of its election to participate in the fund, and (2) no later than September 10, 2019, obtain approval from the bankruptcy court or a court of competent jurisdiction of its determination to pay, and approval of its payment of, the initial contribution and, as they become due, annual contributions to the fund, provided that the contributions shall not be due to the fund until the date the electrical corporation exits the insolvency proceeding. The electrical corporation shall not be entitled to seek payments from the fund pursuant to subdivision (f) until it has funded its initial contribution and has met the other conditions provided in subdivision (b). Participation of an electrical corporation that is the subject of an insolvency proceeding that satisfies the requirements of this subdivision shall be effective as of July 12, 2019, and shall apply to covered wildfires, provided that the fund shall not pay more than 40 percent of the allowed amount of a claim arising between July 12, 2019, and the date the electrical corporation exits bankruptcy, with the balance of those claims being addressed through the insolvency proceeding.
An electrical corporation meeting the applicable requirements of subdivision (b) may seek payment from the fund to satisfy settled or finally adjudicated eligible claims. Only eligible claims shall be made against or paid by the fund. In accordance with the procedures established by the administrator, the administrator shall review and approve any settlement of an eligible claim as being in the reasonable business judgment of the electrical corporation before releasing funds to the electrical corporation for payment. Settlements of subrogation claims that are less than or equal to 40 percent of total asserted claim value as determined by the administrator shall be paid unless the administrator finds that the exceptional facts and circumstances surrounding the underlying claim do not justify the electrical corporation’s exercise of such business judgment. To the extent approved by the administrator, a settlement shall not be subject to further review by the commission.
The administrator shall approve a settlement of an eligible claim that is a subrogation claim if the settlement exceeds 40 percent of the total asserted claim value, as determined by the administrator, and includes a full release of the balance of the asserted claim so long as the administrator finds that the electrical corporation exercised its reasonable business judgment in determining to settle for a higher percentage or on different terms based on a determination that the specific facts and circumstances surrounding the underlying claim justify a higher settlement percentage or different terms. A subrogation claim that is finally adjudicated shall be paid in the full judgment amount.
Except for Golden State Energy, all initial and annual contributions shall be excluded from the measurement of the authorized capital structure.
Except as provided in paragraph (2), within six months after the commission adopts a decision in an application filed pursuant to Section 1701.8, the electrical corporation shall reimburse the fund for the full amount of costs and expenses the commission determined were disallowed pursuant to Section 1701.8.
The obligation of an electrical corporation to reimburse the fund shall be the lesser amount of subparagraph (B) or (C).
The costs and expenses determined not to be just and reasonable pursuant to Section 1701.8.
The amount determined pursuant to sub-subclause (ia) minus the amount determined pursuant to sub-subclause (ib).
(ia) (IA) Except as specified in sub-sub-subclause (IB), for each electrical corporation, 20 percent of the electrical corporation’s total transmission and distribution equity rate base, including, but not limited to, its Federal Energy Regulatory Commission (FERC) assets, as determined by the administrator for the calendar year in which the disallowance occurred.
(IB) For Golden State Energy’s first twelve months of participation in the fund, an amount equal to 20 percent of Pacific Gas and Electric Company’s total transmission and distribution equity rate base, including, but not limited to, its Federal Energy Regulatory Commission assets, at the time of the closing of the acquisition of Pacific Gas and Electric Company, as determined by the commission. For Golden State Energy’s subsequent years of participation in the fund, an amount determined by the commission that is equivalent to the amount specified in subclause (I) for electrical corporations with an equity rate base.
(ib) The sum of the amounts actually reimbursed to the fund for costs and expenses that were determined not to be just and reasonable pursuant to Section 1701.8 during the measurement period, added to the amount of any reimbursements to the fund owed by the electrical corporation for costs and expenses disallowed during the measurement period that have not yet been paid.
(II) For purposes of this clause, “measurement period” means the period of three consecutive calendar years ending on December 31 of the year in which the calculation is being performed.
(III) This clause shall become inoperative upon all large electrical corporations electing to participate in the account pursuant to Section 3299.
The administrator shall publish calculations of the amounts determined pursuant to subparagraphs (B) and (C) on or before January 1 of each calendar year for each electrical corporation.
Except as provided in paragraph (3), the electrical corporation shall not be required to reimburse the fund for any additional amounts in any three-calendar-year period.
The limitation set forth in this section shall apply only so long as the fund has not been terminated pursuant to subdivision (i).
Paragraph (2) does not apply under either of the following circumstances:
If the administrator determines that the electrical corporation’s actions or inactions that resulted in the covered wildfire constituted conscious or willful disregard of the rights and safety of others.
If the electrical corporation failed to maintain a valid safety certification on the date of the ignition.
The fund shall terminate when the administrator determines that the fund resources are exhausted, taking into account the amount of any unpaid liabilities including necessary reserves, any remaining unpaid annual contributions from participating electrical corporations, and the charges authorized pursuant to Section 3289. Upon the determination of the administrator that the fund shall be terminated, the administrator shall pay all remaining eligible claims and fund expenses, and liquidate any remaining assets. The remaining funds shall be transferred to the General Fund. It is the intent of the Legislature that any funds transferred to the General Fund pursuant to this paragraph shall be appropriated to support wildfire mitigation. Termination of the fund pursuant to this paragraph does not terminate the account within the fund, which shall continue until terminated pursuant to paragraph (2) of subdivision (d) of Section 3298.
Notwithstanding subdivision (f), a regional electrical corporation’s access to the fund to pay eligible claims shall be limited to three times the sum of the regional electrical corporation’s initial contribution and any funded annual contributions per covered wildfire.
Each electrical corporation shall, upon determining that all of its claims, if any, for payment from the fund for a covered wildfire pursuant to subdivision (f) have been fully satisfied and that the large electrical corporation does not anticipate any further claims from a covered wildfire, shall notify the administrator that its claims for payment from the fund for a covered wildfire are fully satisfied.
Upon receipt of all notifications pursuant to paragraph (1), the administrator shall determine whether there is any outstanding obligation on the fund to provide a payment pursuant to subdivision (f) to a large electrical corporation for a covered wildfire or whether any large electrical corporation is likely to submit any additional claims from a covered wildfire. If the administrator reasonably determines that there are no outstanding obligations on the fund to provide payment for a covered wildfire and that no large electrical corporation is likely to submit any additional claims from a covered wildfire, the administrator shall transfer any remaining Wildfire Fund assets, including all contributions and reimbursements to the fund pursuant to subdivision (h) that are made after the operative date of this subdivision, into the account.
This subdivision shall become operative upon all large electrical corporations electing to participate in the account pursuant to Section 3299.
A participating electrical corporation shall maintain reasonable insurance coverage. The administrator shall periodically review and make a recommendation as to the appropriate amount of insurance coverage required, taking into account the availability of insurance, the electrical corporation’s service territory, including the fire risk of the territory, the size of the territory, and the value of the real estate in the territory, the safety record of the electrical corporation, the wildfire mitigation measures implemented by the electrical corporation, the impact to the ratepayers, and other factors deemed appropriate by the administrator.
Costs and expenses of administration of the fund shall be paid from Wildfire Fund assets.
Except as provided in subdivision (b), within six months after the commission adopts a decision in an application filed pursuant to Section 1701.8, a governmental assessment shall be imposed in the full amount of, and the electrical corporation shall reimburse the fund for the full amount of, costs and expenses the commission determined were the amount of the obligation to reimburse the fund pursuant to subdivision (d) of Section 3291 or subdivision (h) of Section 3292 in a proceeding authorized pursuant to Section 1701.8.
With respect to a governmental assessment pursuant to subdivision (a), the fund is granted a statutory lien on the revenues of an electrical corporation participating in the fund to secure the electrical corporation’s reimbursement obligations to the fund, which statutory lien shall be subordinated and junior in lien priority and right of payment to any lien, mortgage, or security interest securing any debt, note, indenture, lease, contract, or other obligation of the electrical corporation or a financing entity defined in Section 850 in existence on July 12, 2019, or thereafter authorized by the commission, including pursuant to subdivision (g) of Section 80542 of the Water Code; provided that no such lien shall be deemed to have been granted with respect to the revenues of an electrical corporation to the extent that the terms of any debt, note, indenture, lease, contract, or other obligation of the electrical corporation existing on July 12, 2019, prohibits the granting of the lien, or if a breach or default would occur thereunder as a result of the granting of the lien whether or not the breach or default is subject to the passage of time, notice requirements, or otherwise, it being understood that the lien will be deemed to have been automatically granted at the time that the prohibition no longer applies or no breach or default would occur. Subject to the immediately preceding sentence, the subordinated and junior statutory lien shall be automatically perfected without further action of the fund and shall apply regardless of whether the amounts are commingled with other cash or other property of the electrical corporation. The statutory lien granted pursuant to this section shall not attach to any real property of an electrical corporation.
In addition to any rights and remedies of the administrator provided by law, the administrator is authorized at any time and from time to time, without notice to the participating electrical corporations, to set off and apply any and all funds, deposits, or contributions from a participating electrical corporation at any time held by the fund and other obligations owed to the fund, irrespective of whether or not the administrator made demand, and whether the obligations may be contingent or unmatured. The administrator will promptly notify the participating electrical corporation after any such setoff.
Fund earnings are tax exempt and fund contributions by electrical corporations are tax deductible for state tax purposes.
CHAPTER 4. The Continuation Account [3298. - 3298.6.]
There is hereby created the Continuation Account in the Wildfire Fund, which is hereby continued in existence, which is administered by the administrator. Moneys and invested assets in the account are separate and distinct from any moneys in the fund and shall be allocated solely for purposes of Chapter 5 (commencing with Section 3299).
All of the following revenues shall be deposited into the account:
The annual contribution and any additional contribution from a large electrical corporation pursuant to Section 3299.3.
Revenues generated from the ratepayers of each large electrical corporation through a nonbypassable charge extended by the commission pursuant to Section 3299.2.
Proceeds of bonds allocated to the account as provided in Section 80540 of the Water Code.
The administrator shall carry out the duties of this part and may do all of the following, subject to the oversight of the council:
Retain, employ, or contract with officers, experts, employees, accountants, actuaries, financial professionals, and other executives, advisers, consultants, attorneys, and professionals as may be necessary in the administrator’s judgment for the efficient operation and administration of the account.
Enter into contracts and other obligations relating to the operation, management, and administration of the account.
Invest the moneys in the account in those securities eligible under Section 16430 of the Government Code.
Review and approve claims and settlements, and provide funds to large electrical corporations for the purposes of paying eligible claims.
Buy insurance or take other actions to maximize the claims-paying resources of the account.
Pay costs, expenses, and other obligations of the account from account assets.
Take any actions necessary to collect any amounts owing to the account from large electrical corporations.
Undertake other activities related to the operation, management, and administration of the account, as approved by the council.
There shall be a limited civil immunity, and no criminal liability in a private capacity, as a result of any act performed or omitted or obligation entered into in an official capacity, when done or omitted in good faith and without intent to defraud, on the part of the council, the administrator, or on the part of any officer, employee, or agent of the account. The State of California shall have no liability for payment of claims in excess of funds available pursuant to this part. The State of California, and any of the funds of the State of California, shall have no obligations whatsoever for payment of claims or costs arising from this part, except as specifically provided in this chapter.
Upon the determination by the administrator that annual contributions are necessary pursuant to Section 3299.1, the council shall direct the administrator to prepare and present for approval a plan of operations related to the operations, management, and administration of the account on an annual basis. At least annually, the council shall direct the administrator to present the plan of operations to the appropriate policy committees of the Legislature. The plan of operations shall include, but not be limited to, reporting on the account assets, projections for the durability of the account, the success of the account, whether or not the account is serving its purpose, and a plan for winding up the account if projections demonstrate that the account will be exhausted within the next three years.
The Director of Finance may, at any time, examine the books and records of the council and the administrator relating to the operation, management, and administration of the account.
On January 1 of the year following the date on which the administrator determines that annual contributions are necessary pursuant to Section 3299.1, and annually thereafter, the council, with the assistance of the administrator, shall prepare and file with the Legislature and the Department of Finance reports regarding the formation, administration, and disposition of the account.
A report submitted to the Legislature pursuant to this section shall be submitted in compliance with Section 9795 of the Government Code.
CHAPTER 5. Operation of the Account [3299. - 3299.20.]
Within 15 days of the effective date of this chapter, each large electrical corporation shall provide to the commission a written notification of its election to participate, or not to participate, in the account and provide, if applicable, annual contributions and additional contributions pursuant to this chapter.
A large electrical corporation’s election to participate in the account shall be considered as its agreement to do all of the following:
To authorize the administration of the account by the administrator pursuant to this chapter and Chapter 4 (commencing with Section 3298).
To provide an annual contribution pursuant to subdivision (a) of Section 3299.3 and any additional contributions pursuant to subdivision (b) of Section 3299.3.
To consent to the changes in the operation of the fund as provided in clause (ii) of subparagraph (C) of paragraph (2) of subdivision (h) of, and subdivision (k) of, Section 3292, as those provisions read on the effective date of this chapter.
To authorize the use of the Wildfire Fund assets and account assets for purposes of Section 719, as added by the measure adding this chapter.
A large electrical corporation that fails to provide the notification pursuant to this subdivision is deemed to have elected not to participate in the account.
If all large electrical corporations provide written notification to the commission of their election to participate in the account and their commitment to provide annual contributions and additional contributions pursuant to this chapter, the commission shall notify the administrator, the Secretary of State, and the relevant policy committees of the Legislature of the election.
If a notification provided pursuant to subdivision (a) indicates that a large electrical corporation has elected not to participate in the account, or if a large electrical corporation fails to provide the notification pursuant to subdivision (a), the commission shall provide notification of the nonparticipation to the administrator, Secretary of State, and the relevant policy committees of the Legislature and this chapter shall become inoperative on the date of the notification and is repealed on January 1 of the year following the notification.
On or after the date the commission provides the notification pursuant to subdivision (b) of Section 3299, but not later than December 31, 2028, the administrator may determine if annual contributions pursuant to subdivision (a) of Section 3299.3 are required for either of the following reasons:
Absent annual contributions, the administrator would provide a plan for winding up the fund pursuant to Section 3283.
The administrator receives a notification from a large electrical corporation that it has a reasonable belief that it likely will have eligible claims for a single coverage year resulting from one or more covered wildfires.
If the administrator determines that annual contributions are required, the administrator shall provide notification to the commission, the Department of Water Resources, and each large electrical corporation of its determination.
Within 15 days of receiving the notification pursuant to Section 3299.1, the commission shall initiate a rulemaking proceeding to consider using its authority pursuant to Section 701 to require each large electrical corporation to collect a nonbypassable charge from ratepayers of each large electrical corporation to support the account, including the payment of bonds issued pursuant to paragraph (2) of subdivision (a) of Section 80540 of the Water Code, in an amount sufficient to fund the revenue requirement as established pursuant to Section 80524 of the Water Code.
If the commission determines that the imposition of the charge described in subdivision (a) is just and reasonable, and that it is just and reasonable to exercise its authority pursuant to Section 701 to do so, the commission shall direct each large electrical corporation to impose and collect that charge commencing February 1, 2036. The charge shall be collected in the same manner as that for the payments made to reimburse the Department of Water Resources under paragraph (2) of subdivision (a) of Section 3289.
Notwithstanding other law, no later than 90 days after the initiation of the rulemaking proceeding, the commission shall adopt a decision regarding the imposition of the charge.
If the commission imposes a nonbypassable charge pursuant to Section 3299.2, each large electrical corporation shall provide to the administrator for deposit into the account its annual contribution, as determined pursuant to paragraph (2), by January 1 of each year from calendar year 2029 to 2045, inclusive, except, if the commission’s decision to impose the nonbypassable charge was made on or after January 1, 2029, the annual contribution for calendar year 2029 shall be made within 90 days of the commission’s decision.
The aggregate total of the annual contributions from the large electrical corporations for each year shall be three hundred million dollars ($300,000,000) and shall be allocated as follows:
47.85 percent for Pacific Gas and Electric Company.
47.85 percent for Southern California Edison Company.
4.30 percent for San Diego Gas and Electric Company.
In addition to subdivision (a), if the administrator determines that additional contributions from large electrical corporations are needed to enable the account to fund the timely payment of eligible claims due to the likelihood of exhaustion of revenues in the account, including the proceeds to bonds issued pursuant to Section 80540 of the Water Code, the administrator shall notify each large electrical corporation that additional contributions, with an aggregate total of three billion nine hundred million dollars ($3,900,000,000), is required. The proportionate share of those additional contributions shall be allocated to large electrical corporations as described in paragraph (2) of subdivision (a) and each large electrical corporation shall pay its proportionate share of the additional contributions to the administrator in equal installments over a five-year period. Each large electrical corporation shall pay its proportionate share of the additional contributions within 120 days of the administrator notifying the large electrical corporation and on the anniversary of its first installment payment each year thereafter.
If the administrator winds up and terminates the account before the final installment payment is paid pursuant to paragraph (1), the large electrical corporation shall provide one-half of the remaining unpaid installment payments pursuant to paragraph (1) as rate credits to its ratepayers.
Contributions made pursuant to this section shall not be recovered from the ratepayers of a large electrical corporation and shall be excluded from the measurement of its authorized capital structure.
If a large electrical corporation is required to reimburse the account in accordance with subdivision (b) of Section 3299.10, the large electrical corporation may reduce the amount required to be reimbursed by the amount of contributions it has paid pursuant to this section for which the large electrical corporation has not claimed a reduction pursuant to this subdivision.
A large electrical corporation shall maintain reasonable insurance coverage. The administrator shall periodically review and make a recommendation as to the appropriate amount of insurance coverage required, taking into account the availability of insurance, the large electrical corporation’s service territory, including the fire risk of the territory, the size of the territory, and the value of the real estate in the territory, the safety record of the large electrical corporation, the wildfire mitigation measures implemented by the large electrical corporation, the impact to the ratepayers, and other factors deemed appropriate by the administrator.
A large electrical corporation may seek payment from the account to satisfy settled or finally adjudicated eligible claims. Only eligible claims shall be made against or paid by the account. In accordance with the procedures established by the administrator, the administrator shall review and approve any settlement of an eligible claim as being in the reasonable business judgment of the large electrical corporation before releasing funds to the large electrical corporation for payment. To the extent approved by the administrator, a settlement shall not be subject to further review by the commission.
Except as provided in paragraph (2), within six months of the commission adopting a decision for an application filed pursuant to Section 1701.8, a large electrical corporation shall reimburse the account for the full amount of costs and expenses the commission determined were disallowed pursuant to Section 1701.8.
The requirement on a large electrical corporation to reimburse the account shall be the lesser amount of subparagraph (B) or (C).
The costs and expenses determined not to be just and reasonable pursuant to Section 1701.8.
The amount determined pursuant to clause (ii) minus the amount determined pursuant to clause (iii).
Twenty percent of the large electrical corporation’s total transmission and distribution equity rate base, including, but not limited to, its Federal Energy Regulatory Commission (FERC) assets, as determined by the administrator for the calendar year in which the ignition of the covered wildfire occurred.
The sum of the amounts actually reimbursed to the account for measurement costs that were determined not to be just and reasonable pursuant to Section 1701.8 added to the amount of any reimbursements to the account owed by the large electrical corporation for measurement costs disallowed that have not yet been paid.
For purposes of this subparagraph, “measurement costs” means costs and expenses that arose out of any covered wildfire ignited within three years of the ignition of the wildfire that is the subject of the application and any measurement costs as defined in subparagraph (C) of paragraph (2) of subdivision (h) of Section 3292.
The administrator shall publish calculations of the amounts determined pursuant to subparagraphs (B) and (C) on or before January 1 of each calendar year for each large electrical corporation.
Except as provided in paragraph (3), a large electrical corporation shall not be required to reimburse the account for any additional amounts for any measurement period.
The limitation set forth in this section shall apply only so long as the account has not been terminated pursuant to paragraph (2) of subdivision (d) of Section 3298.
Paragraph (2) does not apply under either of the following circumstances:
If the administrator determines that the large electrical corporation’s actions or inactions that resulted in the covered wildfire constituted conscious or willful disregard of the rights and safety of others.
If the large electrical corporation failed to maintain a valid safety certification on the date of the ignition.
CHAPTER 6. Right of First Refusal of an electrical Corporation [3299.100. - 3299.100.]
For purposes of this section, “third-party entity” means an entity, other than a large electrical corporation, other insurer or reinsurer admitted to conduct the business of insurance in California or in compliance with Sections 1765.1 and 1765.2 of the Insurance Code, or a law firm or business retained by an insurer for the purpose of assisting with the pursuit of the property insurer’s subrogation rights, that seeks to enter into an agreement with a property insurer.
Any agreement entered into on or after the effective date of this chapter by a property insurer to sell, assign, or transfer, in whole or in part, to a third-party entity, a right of subrogation, reimbursement, or recovery, as applicable, including a right to recover attorney fees, resulting from a wildfire that is ignited on or after the effective date of this chapter and that destroys 1,000 or more structures is subject to all of the following:
Before entering into an agreement with the third-party entity, the property insurer shall first offer to settle its right of subrogation, reimbursement, or recovery, as applicable, on the same terms and conditions as the proposed agreement, to the large electrical corporation, if any, that provides electrical service to the service area in which the wildfire ignited.
Within 30 days of the property insurer making the offer to settle pursuant to paragraph (1), the large electrical corporation shall accept or reject the offer to settle or otherwise reach an agreement on mutually agreeable terms with the property insurer for the settlement of that right with the large electrical corporation.
If the large electrical corporation accepts the property insurer’s offer to settle, or otherwise reaches an agreement with the property insurer on mutually agreeable terms, the property insurer shall execute a release that will release the large electrical corporation from, and bar the property insurer from bringing or pursuing, any lawsuit, claim, arbitration, or other legal action of any kind against the large electrical corporation for damages resulting from the applicable fire with respect to the rights sold, assigned, or transferred to the electrical corporation. The release shall not preclude actions to enforce the terms of the accepted offer or agreement between the electrical corporation and the property insurer.
If the large electrical corporation rejects the offer made, or fails to reach an agreement within 30 days, pursuant to paragraph (2), the property insurer and the third-party entity may enter into an agreement for the sale, assignment, or transfer of the right under either of the following conditions:
The agreement is on the same terms and conditions as the offer made to the large electrical corporation pursuant to paragraph (1).
If the agreement is on different financial terms and conditions from the offer that was initially rejected by the large electrical corporation, the property insurer has first made an offer on those new terms and conditions to the large electrical corporation pursuant to paragraph (1), and the large electrical corporation has rejected that offer.
An agreement for the sale, assignment, or transfer of the right described in this subdivision between a property insurer and a third-party entity that fails to conform to the requirements of this subdivision shall be void and unenforceable.
Disclosure shall be made to the administrator or a public agency to the extent required by law. Information disclosed pursuant to this subparagraph is not a public writing and shall not be subject to public disclosure pursuant to the California Public Records Act (Division 10 (commencing with Section 7920.000) of Title 1 of the Government Code) or any other law.
For a property insurer, disclosure to a third-party insurer or reinsurer that is a party to a contract with the property insurer related to the right if the person or entity to whom disclosure is made agrees to the same nondisclosure terms.
Internal disclosure as necessary for internal business purposes, including, but not limited to, underwriting if the person or entity to whom disclosure is made agrees to the same nondisclosure terms.
An action to enforce the agreement following a breach of the agreement between the large electrical corporation and the property insurer entered into pursuant to this section.
A violation of this section.
An agreement between a property insurer and a third party entity shall not provide for financial participation by the third-party entity in an agreement entered into between the property insurer and a large electrical corporation pursuant to subdivision (b).
A nondisclosure agreement between a property insurer and a third-party entity prohibiting the disclosure of the terms and conditions of an offer for an agreement subject to this section shall not prohibit the disclosure of those terms and conditions to the large electrical corporation as required pursuant to paragraph (1) of subdivision (b). A large electrical corporation to which those terms and conditions are disclosed shall not disclose that information to any third-party that is not subject to the nondisclosure agreement.
This section does not apply to a California domestic insurer if its annual property line direct written premiums are less than three hundred million dollars ($300,000,000).
DIVISION 1.5. CALIFORNIA CONSUMER POWER AND CONSERVATION FINANCING AUTHORITY ACT [3300. - 3383.]
CHAPTER 1. General Provisions and Definitions [3300. - 3304.]
The Legislature finds and declares that in order to furnish the citizens of California with reliable, affordable electrical power, to ensure sufficient power reserves, to assure stability and rationality in California’s electricity market, to encourage energy efficiency and conservation as well as the use of renewable energy resources, and to protect the public health, welfare, and safety, the state needs to finance, purchase, lease, own, operate, acquire, or otherwise provide financial assistance for public and private facilities for the generation and transmission of electricity and for renewable energy, energy efficiency, and conservation programs.
This division shall be known and may be cited as the California Consumer Power and Conservation Financing Authority Act.
As used in this division, unless the context otherwise requires, the following terms have the following meanings:
“Act” means the California Consumer Power and Conservation Financing Authority Act.
“Authority” means the California Consumer Power and Conservation Financing Authority established pursuant to Section 3320 and any board, commission, department, or officer succeeding to the functions thereof, or to whom the powers conferred upon the authority by this division shall be given by law.
“Board” means the Board of Directors of the California Consumer Power and Conservation Financing Authority.
“Bond purchase agreement” means a contractual agreement executed between the authority and an underwriter or underwriters and, where appropriate, a participating party, whereby the authority agrees to sell bonds issued pursuant to this division.
“Bonds” means bonds, including structured, senior, and subordinated bonds or other securities; loans; notes, including bond revenue or grant anticipation notes; certificates of indebtedness; commercial paper; floating rate and variable maturity securities; and any other evidences of indebtedness or ownership, including certificates of participation or beneficial interest, asset backed certificates, or lease-purchase or installment purchase agreements, whether taxable or excludable from gross income for state and federal income taxation purposes.
“Cost,” as applied to a program, project, or portion thereof financed under this division, means all or any part of the cost of construction, improvement, repair, reconstruction, renovation, and acquisition of all lands, structures, improved or unimproved real or personal property, rights, rights-of-way, franchises, licenses, easements, and interests acquired or used for a project; the cost of demolishing or removing or relocating any buildings or structures on land so acquired, including the cost of acquiring any lands to which the buildings or structures may be moved; the cost of all machinery and equipment; financing charges; the costs of any environmental mitigation; the costs of issuance of bonds or other indebtedness; interest prior to, during, and for a period after, completion of the project, as determined by the authority; provisions for working capital; reserves for principal and interest; reserves for reduction of costs for loans or other financial assistance; reserves for maintenance, extension, enlargements, additions, replacements, renovations, and improvements; and the cost of architectural, engineering, financial, appraisal, and legal services, plans, specifications, estimates, administrative expenses, and other expenses necessary or incidental to determining the feasibility of any project, enterprise, or program or incidental to the completion or financing of any project or program.
“Enterprise” means a revenue-producing improvement, building, system, plant, works, facilities, or undertaking used for or useful for the generation or production of electric energy for lighting, heating, and power for public or private uses. Enterprise includes, but is not limited to, all parts of the enterprise, all appurtenances to it, lands, easements, rights in land, water rights, contract rights, franchises, buildings, structures, improvements, equipment, and facilities appurtenant or relating to the enterprise.
“Financial assistance” in connection with a project, enterprise or program, includes, but is not limited to, any combination of grants, loans, the proceeds of bonds issued by the authority, insurance, guarantees or other credit enhancements or liquidity facilities, and contributions of money, property, labor, or other things of value, as may be approved by resolution of the board; the purchase or retention of authority bonds, the bonds of a participating party for their retention or for sale by the authority, or the issuance of authority bonds or the bonds of a special purpose trust used to fund the cost of a project or program for which a participating party is directly or indirectly liable, including, but not limited to, bonds, the security for which is provided in whole or in part pursuant to the powers granted by this division; bonds for which the authority has provided a guarantee or enhancement; or any other type of assistance determined to be appropriate by the authority.
“Fund” means the California Consumer Power and Conservation Financing Authority Fund.
“Loan agreement” means a contractual agreement executed between the authority and a participating party that provides that the authority will loan funds to the participating party and that the participating party will repay the principal and pay the interest and redemption premium, if any, on the loan.
“Participating party” means either of the following:
Any person, company, corporation, partnership, firm, federally recognized California Indian tribe, or other entity or group of entities, whether organized for profit or not for profit, engaged in business or operations within the state and that applies for financial assistance from the authority for the purpose of implementing a project or program in a manner prescribed by the authority.
Any subdivision of the state or local government, including, but not limited to, departments, agencies, commissions, cities, counties, nonprofit corporations, special districts, assessment districts, and joint powers authorities within the state or any combination of these subdivisions, that has, or proposes to acquire, an interest in a project, or that operates or proposes to operate a program under Section 3365, and that makes application to the authority for financial assistance in a manner prescribed by the authority.
“Program” means a program that provides financial assistance, as provided in Article 6 (commencing with Section 3365).
“Project” means plants, facilities, equipment, appliances, structures, expansions, and improvements within the state that serve the purposes of this division as approved by the authority, and all activities and expenses necessary to initiate and complete those projects described in Article 5 (commencing with Section 3350) and Article 7 (commencing with Section 3368), of Chapter 3.
“Revenues” means all receipts, purchase payments, loan repayments, lease payments, rents, fees and charges, and all other income or receipts derived by the authority from an enterprise, or by the authority or a participating party from any other financing arrangement undertaken by the authority or a participating party, including, but not limited to, all receipts from a bond purchase agreement, and any income or revenue derived from the investment of any money in any fund or account of the authority or a participating party.
“State” means the State of California.
Any action taken pursuant to this division is exempt from the Administrative Procedure Act, as defined in Section 11370 of the Government Code.
CHAPTER 2. Purpose of the California Consumer Power and Conservation Financing Authority [3310. - 3310.]
The authority may only exercise its powers pursuant to Article 4 (commencing with Section 3340) of Chapter 3 for the following purposes:
Establish, finance, purchase, lease, own, operate, acquire, or construct generating facilities and other projects and enterprises, on its own or through agreements with public and private third parties or joint ventures with public or private entities, or provide financial assistance for projects or programs by participating parties, to supplement private and public sector power supplies, taking into account generation facilities in operation or under development as of August 13, 2001, and to ensure a sufficient and reliable supply of electricity for California’s consumers at just and reasonable rates.
Sponsor, finance, purchase, lease, own, operate, acquire, or construct an eligible transmission project, as defined in Section 63049.71 of the Government Code.
Finance programs, administered by the Energy Commission, the commission, and other approved participating parties for consumers and businesses to invest in cost-effective energy efficient appliances, renewable energy projects, and other programs that will reduce the demand for energy in California.
Finance natural gas transportation and storage projects under Article 7 (commencing with Section 3368) of Chapter 3.
Achieve an adequate energy reserve capacity in California within five years of August 13, 2001.
Provide financing for owners of aged, inefficient, electric powerplants to perform necessary retrofits to improve the efficiency and environmental performances of those powerplants.
CHAPTER 3. The California Consumer Power and Conservation Financing Authority [3320. - 3369.5.]
ARTICLE 1. Creation of the Authority [3320. - 3320.]
There is hereby created in the state government the California Consumer Power and Conservation Financing Authority, which shall be responsible for administering this division.
The authority shall implement the purposes of Chapter 2 (commencing with Section 3310), and to that end finance projects and programs in accordance with this division, all to the mutual benefit of the people of the state and to protect their health, welfare, and safety.
ARTICLE 2. Board of Directors [3325. - 3328.]
The authority shall be governed by a five-member board of directors that shall consist of the following persons:
Four individuals appointed by the Governor, subject to confirmation by the Senate. These four members shall have considerable experience in power generation, natural gas transportation or storage, energy conservation, financing, or ratepayer advocacy.
The State Treasurer.
For the initial term, the appointed members shall serve staggered terms as follows:
The member appointed first shall serve a term of four years.
The member appointed second shall serve a term of three years.
The member appointed third shall serve a term of two years.
The member appointed fourth shall serve a term of one year.
The second and any subsequent terms shall be for four years.
A quorum is necessary for any action to be taken by the board. Three of the members shall constitute a quorum, and the affirmative vote of three board members shall be necessary for any action to be taken by the board.
The members of the board shall be subject to the Political Reform Act of 1974 (Title 9 (commencing with Section 81000)) of the Government Code, and all other applicable provisions of law.
The board may purchase insurance for its fiduciaries or for itself to cover liability or losses occurring by reason of the act or omission of a fiduciary, if the insurance permits recourse by the insurer against the fiduciary in the case of a breach of a fiduciary obligation by the fiduciary.
Meetings of the board shall be open to the public and shall be conducted in accordance with the Bagley-Keene Open Meeting Act (Article 9 (commencing with Section 11120) of Chapter 1 of Part 1 of Division 3 of Title 2 of the Government Code).
The California Public Records Act (Division 10 (commencing with Section 7920.000) of Title 1 of the Government Code) applies to all records of the authority.
ARTICLE 3. Chief Executive Officer [3330. - 3330.]
The chief executive officer shall manage and conduct the business and affairs of the authority and the fund subject to the direction of the board. Except as otherwise provided in this section, the board may assign to the executive director, by resolution, those duties generally necessary or convenient to carry out its powers and purposes under this division. Any action involving final approval of any bonds, notes, loans, or other financial assistance shall require the approval of a majority of the members of the board.
ARTICLE 4. Powers of the Authority [3340. - 3347.]
The authority is authorized and empowered to do any of the following:
Adopt an official seal.
Sue and be sued in its own name.
Employ or contract with officers and employees to administer the authority. The authority may contract for the services of a chief executive officer, who shall serve at the pleasure of the board. If the chief executive officer contracts for the services of any other officer or employee, the contract shall be subject to the approval of the board.
Exercise the power of eminent domain.
Adopt rules and regulations for the regulation of its affairs and the conduct of its business.
Do all things generally necessary or convenient to carry out its powers under, and the purposes of, this division.
In connection with the purposes of this division, the authority may do any or all of the following:
Issue bonds, from time to time, as further provided in Chapter 5 (commencing with Section 3380.1), to pay all or part of the cost of any enterprise, project, or program, or to otherwise carry out the purposes of this division.
Enter into joint powers agreements with eligible public agencies pursuant to Chapter 5 (commencing with Section 6500) of Division 7 of Title 1 of the Government Code.
Subject to any statutory or constitutional limitation on their use, do any of the following as may, in the determination of the authority, be necessary or convenient for the successful development, conduct, or financing of a project, program, or enterprise, or for carrying out the purposes of this division:
Engage the services, including, without limitation, the services of private consultants; attorneys; financial professionals and advisors; engineers; architects; construction, land use and environmental experts; and accountants, to render professional and technical assistance and advice.
Contract for engineering, architectural, accounting, or other services of appropriate state agencies.
Pay the reasonable costs, including, without limitation, costs of consulting engineers, architects, accountants, and construction, land use, and environmental experts employed by the authority or any participating party. Except as otherwise provided in Section 3341.5, those costs shall be recovered from participating parties.
Acquire, lease, take title to, and sell by installment sale or otherwise, lands, structures, real or personal property, rights, rights-of-way, franchises, easements, and other interests in lands that are located within the state, as the authority determines to be necessary or convenient for an enterprise or the financing of a project, upon terms and conditions the authority considers to be reasonable.
Make, receive, or serve as a conduit for the making of, or otherwise provide for, grants, contributions, guarantees, insurance, credit enhancements or liquidity facilities, or other financial enhancements to a participating party as financial assistance for a project or program. The sources may include bond proceeds, dedicated taxes, state appropriations, federal appropriations, federal grants and loan funds, public and private sector retirement system funds, and proceeds of loans from the Pooled Money Investment Account, or any other source of money, property, labor, or other things of value.
Make loans to any participating party, either directly or by making a loan to a lending institution or other financial intermediary, in connection with the financing of a project or program in accordance with an agreement between the authority and a participating party, either as a sole lender or in participation with other lenders.
Make loans to any participating party, either directly or by making a loan to a lending institution, in accordance with an agreement between the authority and the participating party to refinance indebtedness incurred by the participating party in connection with projects undertaken and completed prior to any agreement with the authority or expectation that the authority would provide financing, either as a sole lender or in participation with other lenders. The power generated by those projects shall be subject to the terms and conditions specified by the authority in the agreement and pursuant to Section 3351.
Mortgage all or any portion of the authority’s interest in a project or enterprise and the property on which any project or enterprise is located, whether owned or thereafter acquired, including the granting of a security interest in any property, tangible or intangible.
Assign or pledge all or any portion of the authority’s interest in assets, things of value, mortgages, deeds of trust, bonds, bond purchase agreements, loan agreements, indentures of mortgage or trust, or similar instruments, notes, and security interests in property, tangible or intangible and the revenues therefrom, of a participating party to which the authority has made loans, and the revenues therefrom, including payment or income from any interest owned or held by the authority, for the benefit of the holders of bonds.
Lease the project being financed to a participating party, upon terms and conditions that the authority deems proper; charge and collect rents therefor; terminate any lease upon the failure of the lessee to comply with any of the obligations thereof; include in any lease, if desired, provisions that the lessee shall have options to renew the lease for a period or periods, and at rents determined by the authority; purchase any or all of the project; or, upon payment of all the indebtedness incurred by the authority for the financing of the project, the authority may convey, any or all of the project to the lessee or lessees. The power generated by those projects shall be subject to the terms and conditions specified by the authority in the agreement and pursuant to Section 3351.
Issue, obtain, or aid in obtaining, from any department or agency of the United States, from other agencies of the state, or from any private company, any insurance or guarantee to or for, or any letter or line of credit regarding, the payment or repayment of interest or principal, or both, or any part thereof, on any bond, loan, lease, or obligation or any instrument evidencing or securing the same, made or entered into pursuant to this division.
Notwithstanding any other provision of this division, enter into any agreement, contract or other instrument regarding any insurance, guarantee, letter or line of credit specified in paragraph (1), and accept payment in the manner and form provided therein in the event of default by a participating party.
Assign any insurance, guarantee, letter or line of credit specified in paragraph (1) as security for bonds issued by the authority.
Enter into any agreement or contract, execute any instrument, and perform any act or thing necessary or convenient to, directly or indirectly, secure the authority’s bonds or a participating party’s obligations to the authority, including, but not limited to, bonds of a participating party purchased by the authority for retention or sale, with funds or moneys that are legally available and that are due or payable to the participating party by reason of any grant, allocation, apportionment, or appropriation of the state or agencies thereof, to the extent that the Controller shall be the custodian at any time of these funds or moneys, or with funds or moneys that are or will be legally available to the participating party, the authority, or the state or any agencies thereof by reason of any grant, allocation, apportionment, or appropriation of the federal government or agencies thereof; and in the event of written notice that the participating party has not paid or is in default on its obligations to the authority, direct the Controller to withhold payment of those funds or moneys from the participating party over which it is or will be custodian and to pay the same to the authority or its assignee, or direct the state or any agencies thereof to which any grant, allocation, apportionment, or appropriation of the federal government or agencies thereof is or will be legally available to pay the same upon receipt to the authority or its assignee, until the default has been cured and the amounts then due and unpaid have been paid to the authority or its assignee, or until arrangements satisfactory to the authority have been made to cure the default.
Purchase, with the proceeds of the authority’s bonds, bonds issued by, or for the benefit of, any participating party in connection with a project, pursuant to a bond purchase agreement or otherwise. Bonds purchased pursuant to this division may be held by the authority, pledged or assigned by the authority, or sold to public or private purchasers at public or negotiated sale, in whole or in part, separately or together with other bonds issued by the authority, and notwithstanding any other provision of law, may be bought by the authority at private sale.
Enter into purchase and sale agreements with all entities, public and private, including state and local government pension funds, with respect to the sale or purchase of bonds.
In connection with an enterprise, the authority may do any or all of the following:
Construct or improve any enterprise. By gift, lease, purchase, eminent domain, or otherwise, it may acquire any real or personal property, for an enterprise, except that no property of a state public body may be acquired without its consent. The authority may sell, lease, exchange, transfer, assign, or otherwise dispose of any real or personal property or any interest in such property. It may lay out, open, extend, widen, straighten, establish, or change the grade of any real property or public rights-of-way necessary or convenient for any enterprise.
Operate, maintain, repair, or manage all or any part of any enterprise, including the leasing for commercial purposes of surplus space or other space that is not economic to use for such enterprise.
Adopt reasonable rules or regulations for the conduct of the enterprise.
Prescribe, revise, and collect charges for the services, facilities, or energy furnished by the enterprise. The charges shall be established and adjusted so as to provide funds sufficient with other revenues and moneys available therefor, if any, to (1) pay the principal of and interest on outstanding bonds of the authority financing such enterprise as the same shall become due and payable, (2) create and maintain reserves, including, without limitation, operating and maintenance reserves and reserves required or provided for in any resolution authorizing, or trust agreement securing such bonds, and (3) pay operating and administrative costs of the authority.
Execute all instruments, perform all acts, and do all things necessary or convenient in the exercise of the powers granted by this article.
In connection with a project, the authority may do any or all of the following:
Determine the location and character of any project to be financed under this division.
Acquire, construct, enlarge, remodel, renovate, alter, improve, furnish, equip, own, maintain, manage, repair, operate, lease as lessee or lessor, or regulate any project to be financed under this division.
Contract with any participating party for the construction of a project by such participating party.
Enter into leases and agreements, as lessor or lessee, with any participating party relating to the acquisition, construction, and installation of any project, including real property, buildings, equipment, and facilities of any kind or character.
Establish, revise, charge and collect rates, rents, fees and charges for a project. The rates, rents, fees, and charges shall be established and adjusted in respect of the aggregate rates, rents, fees, and charges from all projects so as to provide funds sufficient with other revenues and moneys available therefor, if any, to (1) pay the principal of and interest on outstanding bonds of the authority financing such project as the same shall become due and payable, (2) create and maintain reserves, including, without limitation, operating and maintenance reserves and reserves required or provided for in any resolution authorizing, or trust agreement securing such bonds, and (3) pay operating and administrative costs of the authority.
Enter into contracts of sale with any participating party covering any project financed by the authority.
As an alternative to leasing or selling a project to a participating party, finance the acquisition, construction, or installation of a project by means of a loan to the participating party.
Execute all instruments, perform all acts, and do all things necessary or convenient in the exercise of the powers granted by this article.
In connection with the purposes of this division, the authority shall charge and equitably apportion among participating parties or other public or private entities the authority’s administrative costs and expenses, including operating and financing-related costs incurred in the exercise of the powers and duties conferred by this division, except to the extent that those costs are related to one of the authority’s own enterprises or projects, in which case costs shall be included in the cost of generating that electricity as provided in Section 3351.
The fiscal powers granted to the authority by this division may be exercised without regard or reference to any other department, division, or agency of the state, except the Legislature or as otherwise stated in this division. This division shall be deemed to provide an alternative method of doing the things authorized by this division, and shall be regarded as supplemental and additional to powers conferred by other laws.
No member of the board or any person executing bonds of the authority pursuant to this division shall be personally liable on the bonds or subject to any personal liability or accountability by reason of the issuance thereof.
All expenses incurred in carrying out this division shall be payable solely from funds provided under the authority of this division and no liability or obligation shall be imposed upon the State of California and, none shall be incurred by the authority beyond the extent to which moneys shall have been provided under this division. Under no circumstances shall the authority create any debt, liability, or obligation on the part of the State of California payable from any source whatsoever other than the moneys provided under this division.
The authority’s operating budget shall be subject to review and appropriation in the annual Budget Act. For purposes of this section, the authority’s operating budget shall include the costs of personnel, administration, and overhead.
The Bureau of State Audits shall perform an evaluation of the effectiveness of the authority’s efforts in achieving its purposes as described in Section 3310. The evaluation shall include recommendations as to whether there is a continued need for the authority beyond January 1, 2007. The evaluation shall be submitted to the Governor and the Legislature on or before January 1, 2005.
ARTICLE 5. Generation Facilities [3350. - 3356.]
In evaluating the eligibility for financing of additional generation facilities, the authority shall utilize the Energy Commission’s and the Independent System Operator’s, or their successor’s, information relating to the need for additional generating facilities and their forecasts of electric supply and demand for the state.
All generation-related projects and enterprises financed pursuant to this division shall provide electricity to the consumers of this state at the cost of generating that electricity, including the costs of financing those projects or enterprises. To the extent that electricity is not needed in the state, or that it is financially advantageous to California consumers, the electricity may be sold outside the state at just and reasonable rates.
If a participating party is an electrical corporation, the commission shall determine the cost of generating electricity and to which entities the electricity is sold.
If a participating party is a local publicly owned electric utility seeking to provide electricity to consumers in its service territory, the governing board of that utility shall determine the cost of generating electricity and to which entities the electricity is sold.
If neither subdivision (b) nor subdivision (c) applies, the authority shall determine the cost of generating electricity and to which entities the electricity is sold, consistent with subdivision (a).
In addition to the other powers provided in this division, the activities of the authority under this article are intended to supplement private and public sector power supplies, taking into account generation facilities in operation or under development as of the effective date of this section, consistent with achieving reasonable energy capacity reserves within five years of the effective date of this division.
The authority shall have the authority to receive and act on applications for financial assistance from owners of existing powerplants whose owners or operators commit to undertake capacity expansion through facility retrofits, new construction, or both, that will improve the efficiency and environmental performance of generation facilities.
All generation facilities constructed or improved pursuant to this division shall comply with Chapter 1 (commencing with Section 1720) of Part 7 of Division 2 of the Labor Code.
The authority may not invest in any nuclear facilities or develop additional hydroelectric facilities without first receiving specific statutory authorization to do so on a project-by-project basis.
If the authority determines under Section 3350 that additional electric generation supply is required to meet the purposes of this division, the authority may undertake the following activities to ensure that the authority, or any participating party, is able to build, own, and operate generation facilities as part of a least cost electric supply policy:
Identify suitable sites for the construction of generation facilities, taking into account fuel supply, interconnection, community, and environmental factors.
Secure rights to the sites identified, including, but not limited to, fee simple acquisition, leaseholds, or options.
Conduct any studies that may be necessary to construct and operate generation facilities at the site, including, but not limited to, environmental, engineering, or feasibility studies.
Conduct, in coordination with the Energy Commission, all applicable public and community involvement processes.
Apply for permits, licenses, or other local, state, or federal approvals, including, but not limited to, compliance with the applicable procedures of the Energy Commission.
The authority may request proposals from qualified participating parties to purchase, lease, or otherwise acquire sites for the purpose of developing generation facilities that will provide the lowest cost power to consumers over the life of the facilities, consistent with Section 3351.
The authority shall comply with all applicable air quality laws and regulations and the Warren-Alquist State Energy Resources Conservation and Development Act (Division 15 (commencing with Section 25000) of the Public Resources Code).
ARTICLE 6. Renewable Energy and Conservation [3365. - 3367.5.]
The authority may provide loans, utilizing up to one billion dollars ($1,000,000,000) of the bond authority, under terms and conditions approved by the authority, to any participating party, which shall use that loan to make loans available to California consumers and businesses for all of the following purposes:
The purchase of consumer appliances and home improvements with electric and gas energy efficiency or renewable energy characteristics, as approved by the Energy Commission, the commission, or a participating local publicly owned electric utility, as applicable.
The purchase or lease of business equipment and facility improvements with electric and gas energy efficiency or renewable energy characteristics, as approved by the Energy Commission, the commission, or a participating local publicly owned electric utility, as applicable.
Any other electric or natural gas energy conservation program or any program for the use of renewable energy resources, as approved by the Energy Commission, the commission, or a participating local publicly owned electric utility, as applicable.
As a condition of receipt of a loan pursuant to Section 3365, a participating party shall be required to conduct a comprehensive marketing program that makes consumers aware of the availability of these financial assistance programs, and to provide appropriate security for repayment of the loan, including, without limitation, a pledge to the authority of consumer and business loan repayments collected through utility bills, as applicable and a certification that the duration of a loan will not exceed the useful life of a purchase.
The authority shall require that any equipment or improvement financed by a loan made pursuant to this article shall be certified as having been installed or completed.
The authority may require that a participating party utilize a consumer protection plan for screening qualified contractors who serve consumers under this article.
ARTICLE 8. Energy Resource Investment Plan [3369. - 3369.]
Within 180 days of the effective date of this division, the authority, in consultation with the Energy Commission and the Independent System Operator, shall develop an Energy Resource Investment Plan and submit that plan to the Governor and the Joint Legislative Budget Committee and the chairs of the policy committees with jurisdiction over energy policy in the State of California.
The Energy Resource Investment Plan shall take into account California’s anticipated energy service needs for both electricity and natural gas over the next decade. The plan shall address issues regarding adequacy of supply, storage, reliability of service, grid congestion, and environmental quality. In developing the investment plan, the authority shall compare the costs of various energy resources, including a comparison of the costs and benefits of demand reduction strategies with the costs and benefits of additional generation supply. The plan shall acknowledge the potential volatility of fossil fuel prices and the value of resources that avoid that price risk.
The plan shall outline a strategy for cost-effective energy resource investments, using the financing powers provided to the authority by this division. The plan may recommend changes to the specific expenditure authority granted in this division in order to carry out the investment strategy contained in the plan.
The plan shall be developed with input from interested parties at scheduled public hearings of the authority. The authority should adopt the plan by majority vote of the board at a public meeting. The authority shall update the plan on a regular basis as determined by the authority.
All investments made by the authority under this division shall be consistent with the strategy outlined in the Energy Resource Investment Plan. Nothing in this section shall preclude the authority from exercising its powers prior to the adoption of the initial Energy Resource Investment Plan.
The authority shall be the agency responsible for ensuring that the investment strategy outlined in the Energy Resource Investment Plan is implemented. To that end, the authority may, on its own or through a partnership with a participating party, make those investments necessary to ensure that the plan is implemented.
ARTICLE 9. Agencies Relation to Other State Energy Oversight [3369.5. - 3369.5.]
Nothing in this division shall be construed to obviate the need to review the roles, functions, and duties of other state energy oversight agencies and, where appropriate, change or consolidate those roles, functions, and duties. To achieve that efficiency, the Governor may propose to the Legislature a Governmental Reorganization Plan, pursuant to Section 8523 of the Government Code and Section 6 of Article V of the Constitution.
ARTICLE 7. Natural Gas [ - ]
CHAPTER 4. California Consumer Power and Conservation Financing Authority Fund [3370. - 3370.]
There is hereby created in the State Treasury the California Consumer Power and Conservation Financing Authority Fund for expenditure by the authority for the purpose of implementing the objectives and provisions of this division. For the purposes of subdivision (e), or as necessary or convenient to the accomplishment of any other purpose of the authority, the authority may establish within the fund additional and separate accounts and subaccounts.
The assets of the fund shall be available for the payment of the salaries and other expenses charged against it in accordance with this division.
Except as provided under Section 3345, all moneys in the fund that are not General Fund moneys are continuously appropriated to the authority and may be used for any reasonable costs which may be incurred by the authority in the exercise of its powers under this division.
The fund, on behalf of the authority, may borrow or receive moneys from the authority, or from any federal, state, or local agency or private entity, to create reserves in the fund as provided in this division and as authorized by the board.
The authority may pledge any or all of the moneys in the fund (including in any account or subaccount) as security for payment of the principal of, and interest on, any particular issuance of bonds issued pursuant to this division.
The authority, may, from time to time, direct the Treasurer to invest moneys in the fund that are not required for the authority’s current needs, including proceeds from the sale of any bonds, in any securities permitted by law as the authority shall designate. The authority also may direct the Treasurer to deposit moneys in interest-bearing accounts in state or national banks or other financial institutions having principal offices in this state. The authority may alternatively require the transfer of moneys in the fund to the Surplus Money Investment Fund for investment pursuant to Article 4 (commencing with Section 16470) of Chapter 3 of Part 2 of Division 4 of the Government Code. All interest or other increment resulting from an investment or deposit shall be deposited in the fund, notwithstanding Section 16305.7 of the Government Code. Moneys in the fund shall not be subject to transfer to any other fund pursuant to any provision of Part 2 (commencing with Section 16300) of Division 4 of the Government Code, excepting the Surplus Money Investment Fund.
CHAPTER 5. Bonds [3380.1. - 3383.]
For purposes of this division, the authority may incur indebtedness and issue securities of any kind or class, at public or private sale by the Treasurer, and to renew the same, if all such indebtedness, howsoever evidenced, shall be payable solely from revenues.
In connection with the issuance of bonds, in addition to the powers otherwise provided in this division, the authority may do all of the following:
Issue, from time to time, bonds payable from and secured by a pledge of all or any part of the revenues in order to finance the activities authorized by this division, including, without limitation, an enterprise or multiple enterprises, a single project for a single participating party, a series of projects for a single participating party, a single project for several participating parties, or several projects for several participating parties, and to sell those bonds at public or private sale by the Treasurer, in the form and on those terms and conditions as the Treasurer, as agent for sale, shall approve.
Pledge all or any part of the revenues to secure bonds and any repayment or reimbursement obligations of the authority to any provider of insurance or a guarantee of liquidity or credit facility entered into to provide for the payment or debt service on any bond.
Employ and compensate bond counsel, financial consultants, underwriters, and other advisers determined necessary and appointed by the Treasurer in connection with the issuance and sale of any bond.
Issue bonds to refund or purchase or otherwise acquire bonds on terms and conditions as the Treasurer, as agent for sale, shall approve.
Perform all acts that relate to the function and purpose of the authority under this division, whether or not specifically designated in this chapter.
Seek financial assistance from any entity eligible to access the California Transmission Accelerator Revolving Fund pursuant to Article 10.5 (commencing with Section 63049.71) of Chapter 2 of Division 1 of Title 6.7 of the Government Code.
Bonds issued by the authority are legal investments for all trust funds, the funds of all insurance companies, banks, both commercial and savings, trust companies, executors, administrators, trustees, and other fiduciaries, for state school funds, pension funds, and for any funds that may be invested in county, school, or municipal bonds. The bonds issued under this division are securities that may legally be deposited with, and received by, any state or municipal officer or agency or political subdivision of the state, including, without limitation, local agencies, schools, and pension funds, for any purpose for which the deposit of bonds or obligations of the state is now, or may hereafter be, authorized by law, including deposits to secure public funds.
The authority is authorized to obtain loans from the Pooled Money Investment Account pursuant to Sections 16312 and 16313 of the Government Code. These loans shall be subject to the terms negotiated with the Pooled Money Investment Board, including, but not limited to, a pledge of authority bond proceeds or revenues.
Bonds issued under this division shall not be deemed to constitute a debt or liability of the state or of any political subdivision thereof, other than the authority, or a pledge of the faith and credit of the state or of any political subdivision, other than the authority, but shall be payable solely from the funds herein provided therefor. All bonds issued under this division shall contain on the face thereof a statement to the following effect: “Neither the faith and credit nor the taxing power of the State of California or any local agency is pledged to the payment of the principal of or interest on this bond.” The issuance of bonds under this division shall not directly or indirectly or contingently obligate the state or any political subdivision thereof to levy or to pledge any form of taxation whatever therefor or to make any appropriation for their payment. Nothing in this section shall prevent nor be construed to prevent the authority from pledging its full faith and credit to the payment of bonds or issue of bonds authorized pursuant to this division.
CHAPTER 6. Termination Provisions [ - ]
DIVISION 1.7. Golden State Energy Act [3400. - 3558.]
PART 1. General Provisions [3400. - 3418.]
CHAPTER 1. Preliminary Matters [3400. - 3402.]
This division shall be known, and may be cited, as the Golden State Energy Act.
The Legislature finds and declares all of the following:
The safe, efficient, and reliable generation, procurement, transmission, distribution, and storage of energy for residents and businesses in California is essential for living and doing business in California. The economic strength and productivity of California and its residents require the availability of energy with which to operate their businesses and live safely in their homes.
Californians residing, working, or doing business within Pacific Gas and Electric Company’s service territory deserve to be served by a utility that prioritizes operational safety and efficiency, is prudently managed and soundly financed, and has a capital structure that enables it to make critical safety investments.
The Legislature recognizes that Pacific Gas and Electric Company may meet the requirements of Chapter 79 of the Statutes of 2019 and emerge from bankruptcy as a transformed utility that is positioned to provide Californians with access to safe, reliable, and affordable service.
The purpose of this division is to ensure that if Pacific Gas and Electric Company fails to emerge from bankruptcy as a transformed utility, then Golden State Energy is duly empowered to serve in that critical role.
It is the intent of the Legislature that Golden State Energy act pursuant to this division only in the event that a transformed utility does not emerge from the bankruptcy or the transformed utility fails to meet its duty to provide safe, reliable, and affordable energy services.
A failure of Pacific Gas and Electric Company to exit bankruptcy will result in a risk to or delay of fair compensation to the victims that have already been waiting years to put their lives back together. It is therefore the intent of the Legislature that, should Pacific Gas and Electric Company not exit its bankruptcy, Golden State Energy be positioned to take over the utility and compensate victims.
It is the intent of the Legislature that the commission regulate Golden State Energy as an electrical and gas corporation, except that the commission should recognize its status as a nonprofit public benefit corporation, which does not have shareholders and operates for its customers and for the benefit of the people of California. Due to this difference, it is necessary to establish some alternative procedures for Golden State Energy.
It is the intent of the Legislature that all of the following occur if Golden State Energy commences energy operations:
The operation of Golden State Energy, as the successor to Pacific Gas and Electric Company, will be for the benefit of its customers and will lessen the burdens on the State of California. The purpose of any acquisition of Pacific Gas and Electric Company’s property, including franchise rights and stock, pursuant to this division is to provide more reliable energy services with greater attention on public safety.
Golden State Energy should take into account rate impacts on all customer classes and manage its operations to benefit customers throughout its entire service territory.
Golden State Energy should manage its operations to best benefit the public that it serves, demonstrating leadership in the delivery of safe, reliable, clean, affordable energy.
Golden State Energy should adopt procedures to encourage the election of board members who collectively reflect attributes, expertise, and experience relevant to the operation of a safe and reliable utility.
CHAPTER 2. Definitions [3410. - 3418.]
Unless the context otherwise requires, the definitions set forth in this chapter govern the construction of this division.
“Act” means the Golden State Energy Act.
“Acquisition of Pacific Gas and Electric Company” means the acquisition of the property, as defined in Section 1235.170 of the Code of Civil Procedure, including any franchise rights and stock, of Pacific Gas and Electric Company, including by eminent domain.
“Board” means Golden State Energy’s board of directors described in Part 2 (commencing with Section 3420).
“Decision 20-05-053” means Decision 20-05-053 (May 28, 2019) Decision Approving Reorganization Plan in Investigation 19-09-016 (September 26, 2019) Order Instituting Investigation on the Commission’s Own Motion to Consider the Ratemaking and Other Implications of a Proposed Plan for Resolution of Voluntary Case filed by Pacific Gas and Electric Company Pursuant to Chapter 11 of the Bankruptcy Code, in the United States Bankruptcy Court, Northern District of California, San Francisco Division, In re Pacific Gas and Electric Corporation and Pacific Gas and Electric Company, Case No. 19-30088.
“Indebtedness” means bonds, notes, commercial paper, variable rate and variable maturity securities, other obligations, and any other evidences of indebtedness issued by Golden State Energy.
“Pacific Gas and Electric Company” means Pacific Gas and Electric Company, PG&E Corporation, any subsidiary or affiliate of the foregoing holding any assets related to the provision of electrical or gas service within Pacific Gas and Electric Company’s service territory, and any successor to any of the foregoing.
“Pacific Gas and Electric Company’s service territory” means the boundaries and specifications of the company’s service territory on the date of the closing of the acquisition of Pacific Gas and Electric Company.
“Wildfire Fund” means the Wildfire Fund created pursuant to Section 3284.
PART 2. Golden State Energy Board Governance [3420. - 3420.]
The Governor, or the Governor’s designee, may incorporate Golden State Energy as a nonprofit public benefit corporation pursuant to the Nonprofit Public Benefit Corporation Law (Part 2 (commencing with Section 5110) of Division 2 of Title 1 of the Corporations Code) for the purpose of owning, controlling, operating, or managing electrical and gas services for its ratepayers and for the benefit of all Californians.
Golden State Energy’s initial board of directors shall consist of nine members.
The initial board members shall be appointed as follows: five members appointed by the Governor, two members appointed by the Senate Committee on Rules, and two members appointed by the Speaker of the Assembly.
Of the initial board members, one appointee from each of the appointing authorities shall initially serve a two-year term, three appointees by the Governor shall initially serve four-year terms, and one appointee from each of the appointing authorities shall initially serve a six-year term.
The initial board of directors shall amend Golden State Energy’s bylaws to include procedures for the transition to a board consisting of three appointed members, with one member appointed by each of the appointing authorities specified in paragraph (2), who shall serve four-year terms, and six members elected by Golden State Energy’s customers, who shall serve a maximum of six-year terms. The procedures for the transition shall provide for the following:
The initial board members serving the two-year term shall be replaced by elected members.
The initial board members serving the four-year term shall be replaced by elected members.
The initial board members serving the six-year term shall be replaced by appointed members, with one member appointed by each of the appointing authorities. The appointing authority may reappoint a board member whose term has expired.
Election procedures adopted by the initial board shall include all of the following:
Nomination of members for election to the board shall be based on a matrix of skills, including the following expertise and experience:
Wildfire safety, preparedness, prevention, mitigation, response, or recovery.
(II) Workforce safety and safety culture.
(III) Nuclear generation safety.
(IV) Leadership in the energy or utility industry.
Utility operations and engineering.
(VI) Innovation and technology in renewable energy.
(VII) Risk management, including enterprise risk management.
(VIII) Climate change mitigation or climate resilience.
(IX) Financial performance and planning.
Legal, regulatory, or government experience related to utilities.
(XI) Audit.
(XII) Corporate governance or executive compensation.
(XIII) Labor relations.
(XIV) Large-scale customer experience.
(XV) Utility board experience.
Measures to maximize board member diversity and the selection of California residents located in the service territory of Golden State Energy.
Selection by the board, or a committee of the board, of a slate of candidates for election that shall include no less than two candidates for each open board seat using search firms to identify, evaluate, and recommend the most qualified candidates for election.
Incorporation of stakeholder input into the board selection process.
All elected or appointed members of the board, including those appointed pursuant to paragraph (2), shall be free of conflicts of interest that violate state law or the by-laws of Golden State Energy, and shall have demonstrated expertise or experience in one or more of the areas listed in subclauses (I) to (XV), inclusive, of clause (i) of subparagraph (B).
The initial board of directors shall amend Golden State Energy’s bylaws to include provisions that do all of the following:
Ensure that the purposes and functions of Golden State Energy are consistent with the purposes and functions of nonprofit, public benefit corporations in the state, including duties of care and conflict-of-interest standards for officers and board members of a corporation.
Maintain open meeting standards and meeting notice requirements consistent with the general policies of the Bagley-Keene Open Meeting Act (Article 9 (commencing with Section 11120) of Chapter 1 of Part 1 of Division 3 of Title 2 of the Government Code) and affording the public the greatest possible access, consistent with other duties of the corporation.
Provide public access to corporate records consistent with the general policies of the California Public Records Act (Division 10 (commencing with Section 7920.000) of Title 1 of the Government Code) and affording the public the greatest possible access, consistent with the other duties of the corporation.
Upon the adoption or amendment of Golden State Energy’s bylaws, the board shall submit the adopted or amended bylaws to the Governor, the Legislature, and the commission.
PART 3. Golden State Energy Regulation and Oversight [3430. - 3435.]
Except as otherwise provided in this division, the Nonprofit Public Benefit Corporation Law (Part 2 (commencing with Section 5110) of Division 2 of Title 1 of the Corporations Code) shall apply to Golden State Energy, and Golden State Energy shall have all the powers of a nonprofit public benefit corporation formed pursuant to that part.
Golden State Energy is an electrical corporation and gas corporation subject to all statutory provisions and the regulatory authority of the commission applicable to electrical or gas corporations, except as otherwise provided in this division.
Insofar as this division is inconsistent with any other law, including the Nonprofit Public Benefit Corporation Law (Part 2 (commencing with Section 5110) of Division 2 of Title 1 of the Corporations Code), this division shall prevail.
Insofar as there is overlap in the application of oversight authority over Golden State Energy, including between the commission and the Attorney General, the commission’s authority shall prevail.
Golden State Energy shall be exempt from the Attorney General’s supervisory authority described in each of the following provisions:
Paragraph (5) of subdivision (a) of Section 5142 of the Corporations Code.
Section 5250 of the Corporations Code.
Section 5813.5 of the Corporations Code.
Section 5913 of the Corporations Code.
Section 6010 of the Corporations Code.
Chapter 15 (commencing with Section 6510) of Part 2 of Division 2 of Title 1 of the Corporations Code.
Chapter 16 (commencing with Section 6610) of Part 2 of Division 2 of Title 1 of the Corporations Code.
The Supervision of Trustees and Fundraisers for Charitable Purposes Act (Article 7 (commencing with Section 12580) of Chapter 6 of Part 2 of Division 3 of Title 2 of the Government Code).
Golden State Energy shall not be required to give notice to the Attorney General pursuant to the Nonprofit Public Benefit Corporation Law (Part 2 (commencing with Section 5110) of Division 2 of Title 1 of the Corporations Code).
A person who, pursuant to a specific provision of Golden State Energy’s articles or bylaws, has the right to vote for the election of a director, on a disposition of all or substantially all of the assets of a corporation, on a merger, or on a dissolution, shall not be a member of Golden State Energy for purposes of the Nonprofit Public Benefit Corporation Law (Part 2 (commencing with Section 5110) of Division 2 of Title 1 of the Corporations Code), unless the articles or bylaws designate the person as a member.
In addition to the purposes described in Section 817, Golden State Energy may issue debt to facilitate the acquisition of Pacific Gas and Electric Company consistent with this section.
Golden State Energy may provide a rate covenant to all of its debt holders, including holders of debt issued to facilitate the acquisition of Pacific Gas and Electric Company.
Before issuing debt pursuant to this section, Golden State Energy shall submit an application to the commission for the authority to do so pursuant to Section 818. Notwithstanding Section 819, with respect to debt issued to facilitate the acquisition of Pacific Gas and Electric Company, the commission shall issue an order resolving the application within 100 days of the application’s submittal. Notwithstanding subdivision (d) of Section 311 and any other law, with respect to debt issued to facilitate the acquisition of Pacific Gas and Electric Company, the commission may issue an order resolving the application not sooner than 15 days following the filing and service of the proposed decision by the assigned commissioner or the administrative law judge or the filing of any alternate decision pursuant to Section 311.
Pursuant to the rate covenant, in each general rate case or attrition year adjustment application, Golden State Energy shall apply for a revenue requirement sufficient to do all of the following:
Pay for operations and maintenance costs, and administrative and general expenses.
Service debt and satisfy any debt service coverage margin associated with the rate covenant’s requirements for debt, or for the refinancing of that debt, (A) issued to fund the formation of Golden State Energy and to acquire Pacific Gas and Electric Company, (B) issued by Golden State Energy between the acquisition of Pacific Gas and Electric Company and the approval of Golden State Energy’s first general rate case application, and (C) approved by the commission pursuant to a general rate case application filed by Golden State Energy, including for compliance with the regulatory requirements described in subdivision (f).
Pay the costs of commission approved capital expenditures not funded from debt.
Fund and maintain necessary financial and operating reserves.
Concurrent with each general rate case or attrition year application, Golden State Energy shall file with the commission a debt issuance and retirement forecast summarizing the prospective estimated necessary debt issuance and estimated debt repayment during the term of the general rate case and the additional revenue requirement necessary to meet the rate covenant’s requirements taking into account any additional debt issuance and repayment.
In each Golden State Energy general rate case or attrition year adjustment, the commission shall do both of the following:
Consider, modify if necessary, and adopt a revenue requirement adequate to furnish and maintain efficient, just and reasonable service, instrumentalities, equipment, and facilities to promote the safety, health, comfort, and convenience of its customers, employees, and the public. The commission shall only approve just and reasonable rates; however, in no event shall the commission set the revenue requirement below the amount necessary to satisfy the rate covenant’s requirements.
Authorize Golden State Energy to issue debt as necessary to maintain and operate its assets consistent with the revenue requirement approved by the commission for the applicable period of the general rate case.
No later than 45 days after (A) the earliest occurrence of a material bankruptcy event described in paragraph (2), (B) the commission determines that Pacific Gas and Electric Company’s certificate of public convenience and necessity for the provision of electrical or gas service should be revoked pursuant to any processes or procedures adopted by the commission in its Decision 20-05-053, or (C) the initiation by Pacific Gas and Electric Company of a sale process for its assets or stock, the commission shall initiate a proceeding to modify the rules and processes that apply to Pacific Gas and Electric Company as necessary to reflect the differences in Golden State Energy’s capital structure to ensure continued regulation of rates, electrical and gas safety, wildfire mitigation, climate change mitigation and adaption, public purpose programs, and any other commission requirements applicable to an electrical corporation or gas corporation.
For purposes of this subdivision, each of the following is a material bankruptcy event:
Termination of “Tort Claimants Committee Restructuring Support Agreement” (as amended) (Case 19-30088; Document No. 5143-1 (entered December 16, 2019)).
Termination of “Noteholder Restructuring Support Agreement” (Case 19-30088; Document No. 5519-1 (entered January 27, 2020)).
Denial of confirmation of “Debtors’ and Shareholder Proponents’ Joint Chapter 11 Plan of Reorganization Dated March 16, 2020” (Case 19-30088; Document No. 6320 (entered March 16, 2020)).
Failure to confirm on or before June 30, 2020, a plan for Pacific Gas and Electric Company to exit bankruptcy.
Failure of the confirmed plan for Pacific Gas and Electric Company to exit bankruptcy to become effective on or before September 30, 2020.
The termination of plan proposal’s exclusivity period for any party other than the debtors.
The filing of a plan for Pacific Gas and Electric Company to exit bankruptcy by any party other than the debtors.
The appointment of a trustee, conversion to a case under Chapter 7 (commencing with Section 701) of the United State Bankruptcy Code (Title 11 of the United States Code), or dismissal of the bankruptcy cases.
Following the closing of the acquisition of Pacific Gas and Electric Company by Golden State Energy, the general rate case revenue requirement in effect for Pacific Gas and Electric Company on the date of the closing of the acquisition shall remain in effect until the revenue requirement is modified pursuant to this section.
The test year for the initial general rate case proceeding for Golden State Energy shall occur no sooner than three years from the date of the closing of the acquisition of Pacific Gas and Electric Company.
During the interim period between the closing of the acquisition of Pacific Gas and Electric Company and the commission’s adoption of a new general rate case revenue requirement in a general rate case proceeding pursuant to paragraph (2), both of the following may occur.
The commission shall direct Golden State Energy to file for attrition year adjustment of the existing revenue requirement.
Golden State Energy may make interim modifications to the existing revenue requirement to satisfy the rate covenant, including factoring in capital expenses, debt issuances, operation and maintenance of the utility, funding reserves, and working capital needs and collection of amounts recorded in balancing accounts after the date of the acquisition of Pacific Gas and Electric by Golden State Energy. Any interim modifications to the revenue requirement shall be subject to approval of and prospective modification by the commission consistent with subdivision (f). Golden State Energy shall file an application for review of any interim modifications to its revenue requirement concurrently with the implementation of such modification.
Until Golden State Energy adopts a plan to address organizational and governing issues related to safety that is approved by the commission, upon the acquisition of Pacific Gas and Electric Company, Golden State Energy shall comply with provisions set forth in Decision 20-05-053 related to all of the following:
The establishment of an executive-level Chief Risk Officer and an executive-level Chief Safety Officer.
The appointment of an independent safety adviser.
The appointment of regional executive officers to manage specified regions of the service territory of Golden State Energy.
The continuation of the safety and nuclear oversight committees.
PART 4. GOLDEN STATE ENERGY FINANCING POWER [3440. - 3446.]
Golden State Energy shall be exempt from franchise and corporate income tax pursuant to Section 23701 of the Revenue and Taxation Code. Indebtedness issued by Golden State Energy and any transfer thereof shall be exempt from income taxation of every kind by the state.
Golden State Energy indebtedness shall not be deemed to constitute a debt or liability of the state or of any political subdivision thereof, or a pledge of the faith and credit of the state or of any political subdivision of the state.
Golden State Energy indebtedness shall be payable solely from the funds available to it.
The issuance of indebtedness shall not directly, indirectly, or contingently obligate the state or any other political subdivision of the state to levy or pledge any form of taxation or to make any appropriation for its repayment.
Chapter 9 (commencing with Section 5700) of Division 6 of Title 1 of the Government Code shall not apply to any bonds or other forms of indebtedness issued for the benefit, or on behalf, of Golden State Energy.
Notwithstanding any other law, whenever Golden State Energy deems that it will be in the best interests of its ratepayers, it may exercise an exclusive right to select and retain, or have any conduit issuer issuing bonds or other forms of indebtedness for its benefit or on its behalf select and retain, the services of private entities, including, but not limited to, underwriters, bond counsels, tax counsels, disclosure counsels, financial advisers, bond insurers, or other entities providing risk management services for bonds or other forms of indebtedness issued for its benefit or on its behalf. Payment for any of these private entities may be made out of the proceeds of the sale of the bonds or other forms of indebtedness issued for the benefit, or on behalf, of Golden State Energy.
While any indebtedness issued by or on behalf of Golden State Energy remains outstanding, the State of California pledges to the holders of any such indebtedness that the state will not limit or alter the rights vested in Golden State Energy to fulfill the terms of any loan agreement, lease, or other contract with the holders of such indebtedness, or in any way impair the rights or remedies of those holders or of the parties to the related loan agreement, lease, or contract. Golden State Energy may include this pledge in any instrument under which that indebtedness is incurred or issued or other documents entered into in connection with that indebtedness as a covenant for the benefit of the holders thereof.
PART 5. Other Matters [3450. - 3558.]
The Legislature hereby ratifies and deems proper all acts by the Governor or the Governor’s designee before the effective date of this division taken in furtherance of the establishment of Golden State Energy.
This division, being necessary for the prosperity of the state and its residents, shall be liberally construed to effect its purposes.
Assume, take assignment of, and be bound by all collective bargaining agreements and related obligations, including pension and benefit agreements, then in effect that cover the business being acquired.
Assume any obligations for funding under pension plans then in effect.
In the event the transfer is made as part of Pacific Gas and Electric Company’s and PG&E Corporation’s bankruptcy cases pursuant to Chapter 11 (commencing with Section 1101) of the United States Bankruptcy Code (Title 11 of the United States Code) (Case No. 19-30088), adopt and be bound by the terms and provisions set forth on Exhibit B to the Debtors’ and Shareholder Proponents’ Joint Chapter 11 Plan of Reorganization Dated March 16, 2020.
Nothing in this act shall be construed as diminishing or enlarging any valid existing rights under any license or franchise previously issued pursuant to federal or state law.
DIVISION 2. REGULATION OF RELATED BUSINESSES BY THE PUBLIC UTILITIES COMMISSION [3901. - 5513.]
CHAPTER 1. Interstate and Foreign Motor Carriers of Household Goods and Passengers Act [3901. - 3950.]
ARTICLE 1. General Provisions [3901. - 3950.]
This chapter may be cited as the Interstate and Foreign Motor Carriers of Household Goods and Passengers Act.
No household goods carrier, as defined in Section 5109, shall engage in any interstate or foreign transportation of property for compensation by motor vehicle, and no motor carrier shall engage in any interstate or foreign transportation of passengers for compensation by motor vehicle, on any public highway in this state without first having registered the operation with the commission or the carrier’s base registration state, if other than California, as determined in accordance with final regulations issued by the Interstate Commerce Commission pursuant to the Intermodal Surface Transportation Efficiency Act of 1991 (49 U.S.C. Sec. 11506). To register with the commission, carriers specified in this section shall comply with the following:
When the operation requires authority from the Interstate Commerce Commission under the Interstate Commerce Act, or authority from another federal regulatory agency, a copy of that authority shall be filed with the initial application for registration. A copy of any additions or amendments to the authority shall be filed with the commission.
If the operation does not require authority from the Interstate Commerce Commission under the Interstate Commerce Act, or authority from another federal regulatory agency, an affidavit of that exempt status shall be filed with the application for registration.
The commission shall grant registration upon the filing of the application pursuant to applicable law and the payment of any applicable fees, subject to the carrier’s compliance with this chapter.
Household goods carriers, as defined in Section 5109, engaged in interstate or foreign transportation or property for compensation by motor vehicle, and motor carriers engaged in interstate or foreign transportation of passengers for compensation by motor vehicle, upon any public highway in this state who had registered their authority from the Interstate Commerce Commission with the commission pursuant to former Section 3810 are not required to file another initial application as prescribed in paragraph (1) of subdivision (a) of Section 3902.
It is a violation of law for any person or corporation to operate, or cause to be operated, on the highways of this state, any motor vehicle in the transportation of property or passengers for compensation in interstate commerce without having first complied with the requirements of this chapter. That violation may be prosecuted and punished as provided in Section 16560 of the Vehicle Code.
CHAPTER 4. Enforcement of Federal Pipeline Safety Standards for Mobilehome Park Operators [4351. - 4361.]
As used in this chapter:
“Gas” means natural or manufactured gas, except propane, used for light, heat, or power.
“Distribution system” means a system of pipes within a mobilehome park operated by a person or corporation, other than a public utility, which is connected to a meter or other measuring device under the control of a privately owned or publicly owned public utility, for purposes of distribution of gas by the operator of a mobilehome park to the tenants of the mobilehome park who are the actual users of the gas furnished through the meter or device to the operator by the public utility.
“Operator” is a mobilehome park owner or operator who maintains and operates a master-metered natural gas distribution system.
“Department” means the Department of Housing and Community Development.
“Local enforcement agency” means the city, county, or city and county which has assumed the responsibility for the enforcement of Chapter 2 (commencing with Section 18300) of Part 2.1 of Division 13 of the Health and Safety Code.
“Federal law” or “federal pipeline standards” means the federal Natural Gas Pipeline Safety Act of 1968 (49 U.S.C. Sec. 1671 et seq.) and the regulations contained in Parts 190, 191, and 192 of Title 49 of the Code of Federal Regulations.
The commission shall undertake a gas safety inspection and enforcement program for mobilehome parks with distribution systems to ensure compliance with the federal pipeline standards by mobilehome park operators within the state. The commission may adopt rules, which shall be at least as stringent as the federal law in order to protect the health and safety of mobilehome park residents. Nothing in this chapter prohibits the commission from adopting more stringent standards than those in the federal law.
As part of this gas safety inspection and enforcement program, the commission inspectors may:
Enter public or private property as is necessary to carry out this chapter.
Enter and inspect all mobilehome parks, wherever situated, and inspect all documents (including those records listed in subdivision (a) of Section 4353), accommodations, equipment, or paraphernalia used in connection with or related to the gas distribution system of the mobilehome park.
The commission shall conduct an initial inspection of each distribution system which shall take place on the mobilehome park premises. The inspection shall consist of all of the following:
An inspection of the adequacy of the operator’s operation and maintenance plan.
The information contained in the required annual report.
The records of leak surveys and repairs, corrosion control, and cathodic protection of the system.
If deemed appropriate from the review of the records, a physical inspection of the mobilehome park’s distribution system to ensure compliance with the federal law; the applicable sections of Commission General Order 112 relating to mobilehome park distribution systems, excluding the sections relating to gas transmission facilities, LNG facilities, and gathering lines; and any rules and orders adopted by the commission pursuant to this chapter.
If the operator demonstrates compliance pursuant to subdivision (a), the distribution system shall thereafter be inspected at least once every seven years pursuant to a risk-based inspection schedule adopted by the commission. The subsequent inspections shall consist of the elements specified in subdivision (a). However, the commission may institute an inspection at any time if it determines, following a review of a subsequent annual report or receipt of a complaint, that an additional inspection is necessary.
If the operator does not demonstrate compliance pursuant to subdivision (a), the distribution system may be inspected on an annual basis until such time as there is compliance and, thereafter, shall be inspected as specified in subdivision (b).
If upon the initial inspection or any subsequent inspection, the commission determines the presence of a gas leak or other safety hazard in the distribution system which poses a significant or immediate danger to the health and safety of the park residents, the distribution system may be inspected more frequently until the condition is corrected. Once corrected, the park shall be inspected as specified in subdivision (b).
The commission may require an operator to provide necessary assistance to commission inspectors in entering and inspecting the mobilehome park, including, but not limited to:
Allowing commission inspectors entry to mobilehome park premises.
Having, upon notice, the necessary records specified in subdivision (a) available for the commission inspector’s review during the physical inspection.
Assisting in surveying or uncovering portions of a distribution system for purposes of inspection, verification, and testing.
It shall be a violation for a mobilehome park operator to willfully obstruct a commission inspector’s access, entry, or inspection of a mobilehome park.
The commission may enforce subdivision (f) by issuing a citation in the manner specified in subdivision (b) of Section 4357 and shall notify the United States Department of Transportation, the department or local enforcement agency, the utility serving the distribution system, and the operator of any citation issued pursuant to subdivision (f) of Section 4353.
Every operator shall prepare and submit to the commission annually a report on the distribution system.
The report shall be submitted to the commission at the same time the annual application for a permit to operate the mobilehome park is submitted to the department or the local enforcement agency.
The report shall be prepared using a form required by the commission and shall contain the information the commission finds necessary to carry out the intent of this chapter. In developing the form, the commission shall consult with interested parties to ensure that the form contains no more than the necessary and appropriate information to carry out the intent of this chapter.
Upon receipt of the report, the commission shall examine the report for violations of (1) applicable federal pipeline safety laws or regulations or (2) any applicable commission rules or orders. The commission may inspect the operator’s distribution system for the purpose of verifying whether or not a violation of federal or state pipeline safety laws or regulations has occurred or is occurring.
Every operator shall maintain all of the following:
A map, drawing, or diagram which indicates the location of the distribution system’s main and service lines, master-meter, and the identity of key valves.
A copy of each annual report which has been submitted pursuant to the federal law or this chapter.
A copy of any record of leak surveys and repairs, corrosion control, and cathodic protection of the system.
The information and records listed in subdivision (a) shall be provided to any subsequent operator of the distribution system upon the sale, transfer, or other conveyance of title to the mobilehome park.
Notwithstanding any other provision of law, there shall be no penalty pursuant to Section 4357 imposed upon a subsequent operator of the distribution system who has not received the information and records listed in subdivision (a) from the transferring operator or upon any operator who fails to have the information and records for any period on or before the effective date of this section.
Except as specified in Section 4356, after each inspection, the commission shall furnish the operator, or a representative designated in writing by the operator, with a written copy of the inspection report within 30 days of the inspection, and the report shall indicate any violations of applicable federal or state pipeline safety laws or regulations. Upon receipt of a report indicating a safety violation, the operator shall file, within 30 days, a written response with the commission which acknowledges receipt of the report and specifies a compliance plan for correcting the safety violations, including, if appropriate, a timetable for completing necessary repairs or improvements to the distribution system. The commission shall furnish copies of inspection reports indicating safety violations, and responses to these reports, to the United States Department of Transportation and to the department.
If the commission determines the presence of a gas leak or other safety hazard in the distribution system which poses a significant or immediate danger to the health and safety of the park residents, it shall notify the United States Department of Transportation, the department or local enforcement agency, the utility serving the distribution system, and the operator, who shall provide notice to the affected tenants in the park.
The commission shall require the operator to take immediate steps to correct and repair the gas leak or other hazard. The park operator shall obtain permits from the department or local enforcement agency, as required by Part 2.1 (commencing with Section 18200) of Division 13 of the Health and Safety Code. The commission may direct the serving gas corporation to terminate service at the master meter if an operator does not comply with this requirement. The cost of repair or corrective actions shall be borne by the operator.
Any operator who commits a violation enumerated in subdivision (f) of Section 4353, or who fails to file the report required by Section 4354 or to comply with a directive of the commission pursuant to Section 4356 is subject to a civil penalty of not more than one thousand dollars ($1,000) for each day that the violation, failure to file the report or respond to the directive continues, but not to exceed two hundred thousand dollars ($200,000) for a single violation or related series of violations. The commission shall enforce this subdivision.
The commission may enforce subdivision (a) in the following manner:
By issuing a citation to the responsible person, as defined by Section 18603 of the Health and Safety Code, and to the mobilehome park operator. In the event of a violation that constitutes a significant or immediate danger to health and safety of the park residents, the citation shall be issued immediately and served upon the responsible person or the holder of the permit to operate the mobilehome park. The mobilehome park operator shall be responsible for the correction of any violations for which a citation has been given pursuant to this subdivision.
Service of the citation shall be effected either personally or by first-class mail. Each citation shall be in writing and shall describe with particularity the nature of the violation, including a reference to the statutory provisions or regulations alleged to have been violated, as well as any penalty provided by law for failure to make timely correction. The citation shall fix the earliest feasible time, as determined by the commission, for the elimination of the condition constituting the alleged violation.
A mobilehome park operator may request an informal conference with the commission staff to challenge any citation alleging a violation, or any directive to correct a violation. The informal conference, any subsequent hearings, or appeals of a decision of the commission shall be conducted in accordance with the rules and procedures prescribed by the commission.
Nothing in this chapter affects the tort liability of the operator of a distribution system.
The commission shall establish a uniform billing per space or lot surcharge to be paid by operators with distribution systems subject to this chapter on natural gas purchased for distribution to their tenants. The surcharge shall be designed to recover the commission’s costs of the mobilehome park safety inspection and enforcement program required by this chapter.
The commission shall require gas corporations to adjust their rates on an annual basis to recover the surcharge specified in subdivision (a). Mobilehome parks which are served by publicly owned public utilities shall be inspected at the request of the serving utility. However, publicly owned public utilities which serve mobilehome parks subject to this chapter shall only be required to adjust their gas rates to recover the surcharge specified in subdivision (a) when a mobilehome park within the utility’s jurisdiction is inspected.
Notwithstanding any other provision of law or local ordinance, rule, regulation, or initiative measure, the operator shall be entitled to recover the surcharge collected pursuant to subdivision (a) from its tenants on a monthly basis. However, the charge to any tenant shall not exceed 30 cents per month for the period from July 1, 1991, until July 1, 1992, and shall not exceed 25 cents per month after that date. If the commission establishes the surcharge at a lesser amount, the operator’s recovery shall not exceed the actual surcharge.
All surcharge fees collected by gas corporations pursuant to this section shall be forwarded to the commission, as required by the commission. All surcharge fees collected pursuant to this section shall be deposited in the Public Utilities Commission Utilities Reimbursement Account in the General Fund, which fees shall be used, upon appropriation, for purposes of this chapter.
The commission may adopt rules and orders to carry out this chapter.
Nothing in this chapter affects the requirement that operators of liquefied petroleum gas (propane) master-meter systems supplying 10 or more customers from a single source comply with the applicable provisions of the federal law.
In each mobilehome park, the operator shall post on the mobilehome park premises the current emergency telephone numbers for, at a minimum, the gas company, the fire department, and the responsible person as defined by Section 18603 of the Health and Safety Code, and shall maintain on the mobilehome park premises an emergency procedure, which shall be used in the event there is a gas leak or other safety hazard in the gas distribution system. The operator is required to inform each of the tenants of the mobilehome park of the location of these emergency telephone numbers and the emergency procedure.
CHAPTER 4.1. Enforcement of Federal Pipeline Safety Standards for Propane Operators [4451. - 4465.]
As used in this chapter:
“Supplier” means a person or corporation, other than a public utility, who sells propane and arranges for its delivery to the operator’s tank.
“Distribution system” means a system of pipes, operated by a person or corporation other than a public utility, serving 10 or more customers, within a citywide area, an apartment house, a condominium, a cluster of homes, a shopping center, a combination of any of the above, a mobilehome park with two or more customers, or any system if a portion of the system is located in a public place, which is connected to a tank or tanks, for the purpose of distribution of propane to the end customers.
“Operator” means the owner of the mobilehome park or the distribution system, or the designated responsible employee, manager, or legal representative.
“Tank” means a vessel for the storage and distribution of propane.
“Department” means the Department of Housing and Community Development.
“Local enforcement agency” means the city, county, or city and county that has assumed the responsibility for the enforcement of Chapter 2 (commencing with Section 18300) of Part 2.1 of Division 13 of the Health and Safety Code.
“Federal law” or “federal pipeline standards” means the Federal Natural Gas Pipeline Safety Act of 1968 (49 U.S.C. Sec. 1671 et seq.) and the regulations contained in Parts 190, 191, and 192 of Title 49 of the Code of Federal Regulations.
“Propane” means propane gas, also known as liquid petroleum gas or LPG.
“NFPA 58” means National Fire Protection Association Standard number 58, which covers rules and standards for propane service. The Legislature finds and declares that NFPA 58 is overseen by a national committee that ensures that the standard incorporates the latest in current and approved technology.
“Commission” means the Public Utilities Commission.
“General Order (or GO) 112” means the commission’s general order that sets out rules governing design, construction, testing, maintenance, and operation of utility gas gathering, transmission, and distribution piping systems. GO 112 incorporates, by reference, all the pertinent federal laws defined in subdivision (g).
“Public place” means any system supplying two or more customers where any portion is under a public right of way.
“Trust fund” means the propane safety inspection and enforcement trust fund established pursuant to Section 4462.
On or before July 1, 1995, the commission shall undertake a propane safety inspection and enforcement program for propane distribution systems to ensure compliance with the federal pipeline standards by propane operators within the state. The commission may adopt rules, which shall be at least as stringent as the federal law, in order to protect the health and safety of customers served by propane distribution systems. Nothing in this chapter prohibits the commission from adopting more stringent standards than those in the federal pipeline standards.
As part of this propane safety inspection and enforcement program, the commission inspectors may:
Enter public or private property as is necessary to carry out this chapter.
Enter and inspect all propane distribution systems, wherever situated, and inspect all documents (including those records listed in subdivision (a) of Section 4453), accommodations, equipment, or paraphernalia used in connection with or related to the distribution system.
The commission’s propane safety inspection and enforcement program shall not cover propane used by any of the following:
Recreational vehicles and appliances.
Vehicular fuel.
Agricultural, commercial serving less than 10 customers, unless a portion of the system is located in a public place, industrial, and refinery systems.
Cylinder exchange operations.
The commission shall conduct an initial inspection of each distribution system which shall take place on the premises. The inspection shall determine if the distribution system falls under the commission’s safety program pursuant to paragraph (2) of subdivision (c) of Section 4452. If it is determined that it does not, then the inspection shall be terminated immediately. Otherwise, the inspection, and all followup inspections, shall consist of all of the following:
A review of the adequacy of the operator’s operation and maintenance plan, emergency plan, and system map or maps.
Evaluation of the information contained in the required annual report.
A review of the records of leak surveys and repairs, corrosion control, and cathodic protection of the system.
If deemed appropriate from the review of the records, a physical inspection of the propane distribution system to ensure compliance with the federal law, the applicable sections of General Order 112 relating to the distribution system, NFPA 58, and any rules and orders adopted by the commission pursuant to this chapter.
If the operator demonstrates compliance pursuant to subdivision (a), the distribution system shall thereafter be inspected at least once every seven years pursuant to a risk-based inspection schedule adopted by the commission. The subsequent inspections shall consist of the elements specified in subdivision (a). However, the commission may institute an inspection for a distribution system of any size, at any time, if it determines, following a review of a subsequent annual report or receipt of a complaint, that an additional inspection is necessary.
If the operator does not demonstrate compliance pursuant to subdivision (a), the distribution system may be inspected on an annual basis until such time as there is compliance, and thereafter, shall be inspected as specified in subdivision (b).
If upon the initial inspection or any subsequent inspection, the commission determines the presence of a propane leak or other safety hazard in the distribution system that poses a significant or immediate danger to the health and safety of the customers, the distribution system may be inspected more frequently until the condition is corrected. Once corrected, the distribution system shall be inspected as specified in subdivision (b).
The commission may require an operator to provide necessary assistance to commission inspectors in entering and inspecting the distribution systems, including, but not limited to:
Allowing commission inspectors entry to the premises.
Having, upon notice, the necessary records specified in subdivision (a) available for the commission inspector’s review during the physical inspection.
Assisting in surveying or uncovering portions of the distribution systems for purposes of inspection, verification, and testing.
It shall be a violation for an operator to willfully obstruct a commission inspector’s access, entry, or inspection of a distribution system or to remove a warning tag placed on the operator’s tank by a commission inspector pursuant to subdivision (b) of Section 4456.
The commission may enforce subdivision (f) by issuing a citation in the manner specified in subdivision (b) of Section 4457, and shall notify the department or local enforcement agency, the supplier serving the distribution system, the State Fire Marshal, local fire districts, and the operator of any citation issued pursuant to this subdivision.
If the commission determined, upon inspection or a receipt of a complaint or disclosure, that a distribution system pursuant to paragraph (2) of subdivision (c) of Section 4452 is serving more than nine customers, or if any portion of the system is located in a public place, then the distribution system shall be subject to the commission’s safety program as set forth in this chapter.
Every operator of a system serving 10 or more units or where any portion of the system is located in a public place, with the exception of mobilehome parks operators, shall prepare and submit to the commission annually a report on the distribution system. The report shall be submitted by March 31 of each year and shall cover the previous calendar year.
In the case of mobilehome parks, the report shall be submitted to the commission at the same time the annual application for a permit to operate the mobilehome park is submitted to the department or the local enforcement agency.
The report shall be prepared using a form or forms required by the commission, and shall contain the information the commission finds necessary to carry out the intent of this chapter. In developing the form or forms, the commission shall consult with interested parties to ensure that the form contains no more than the necessary and appropriate information to carry out the intent of this chapter.
Upon receipt of the report, the commission shall examine the report for violations of either applicable federal pipeline safety laws or regulations or any applicable commission rules or orders. The commission may inspect the operator’s distribution system for the purpose of verifying whether or not a violation of federal or state pipeline safety laws or regulations, or NFPA 58 rules, has occurred or is occurring.
Every operator shall maintain all of the following:
A map, drawing, or diagram that indicates the location of the distribution system’s main and service lines, tank (or tanks), regulators, the identity and location of key valves, and the identity of the supplier.
A copy of each annual report that has been submitted pursuant to the federal law or this chapter.
A copy of any record of leak surveys and repairs, corrosion control, and cathodic protection of the system.
An operation and maintenance plan, and an emergency plan.
The information and records listed in subdivision (a) shall be provided to any subsequent operator of the distribution system upon the sale, transfer, or other conveyance of title to the distribution system.
Notwithstanding any other provision of law, there shall be no penalty pursuant to Section 4457 imposed upon a subsequent operator of the distribution system who has not received the information and records listed in subdivision (a) from the transferring operator or upon any operator who fails to have the information and records for any period on or before the effective date of this section.
Except as specified in Section 4456, after each inspection, the commission shall furnish the operator, or a representative designated in writing by the operator, with a written copy of the inspection report within 30 days of the inspection. The report shall indicate any violations of applicable federal or state pipeline safety regulations. The operator shall then file, within 30 days, a written response with the commission that acknowledges receipt of the report and specifies a compliance plan for correcting the safety violations, including, if appropriate, a timetable for completing necessary repairs or improvements to the distribution system.
If the commission determines the presence of a propane leak or other safety hazard in the distribution system, which poses a significant or immediate danger to the health and safety of the distribution system’s customers, it shall notify the supplier serving the distribution system; the operator, who shall provide notice to the affected customers; and local authorities, as deemed necessary.
The commission shall require the operator to take immediate steps to correct and repair the propane leak or other hazard. The operator of a mobilehome park shall obtain permits from the department or local enforcement agency, as required by Part 2.1 (commencing with Section 18200) of Division 13 of the Health and Safety Code. Other operators shall obtain permits from local agencies, such as the county or fire district. The commission may place a warning tag on the tank, may direct the serving supplier to terminate service to the tank, and may direct other local suppliers not to serve the tank, if an operator does not comply with this requirement. The cost of repair or corrective action shall be borne by the operator.
Any operator who commits a violation enumerated in subdivision (f) of Section 4453 or who fails to file the report required by Section 4454 or fails to comply with a directive of the commission pursuant to Section 4456 is subject to a civil penalty of not more than one thousand dollars ($1,000) for each day that the violation, or failure to file the report or respond to the directive continues, but not to exceed two hundred thousand dollars ($200,000) for a single violation or related series of violations. The commission shall enforce this subdivision.
The commission may enforce subdivision (a) in the following manner:
By issuing a citation to the operator, as defined by Section 18603 of the Health and Safety Code. In the event of a violation that constitutes a significant or immediate danger to the health and safety of the customers, the citation shall be issued immediately and served upon the responsible person or the holder of the permit to operate the distribution system. The operator shall be responsible for the correction of any violations for which a citation has been given pursuant to this subdivision.
Service of the citation shall be effected either personally or by first-class mail. Each citation shall be in writing and shall describe with particularity the nature of the violation, including a reference to the statutory provisions or regulations alleged to have been violated, as well as any penalty provided by law for failure to make a timely correction. The citation shall fix the earliest feasible time, as determined by the commission, for the elimination of the condition constituting the alleged violation.
A distribution system operator may request an informal conference with the commission staff to challenge any citation alleging a violation, or any directive to correct a violation. The informal conference, any subsequent hearings, or appeals of a decision of the commission shall be conducted in accordance with the rules and procedures prescribed by the commission.
Nothing in this chapter affects the tort liability of the operator of a distribution system.
The commission shall establish a surcharge to be paid by operators with distribution systems subject to this chapter on propane purchased for distribution to their customers. The surcharge shall be designed to partially recover the commission’s costs of the propane safety inspection and enforcement program required by this chapter, and to partially recover the commission’s costs of collecting and administering the surcharge. The commission shall collect the surcharge from the operators and deposit it into the Propane Safety Inspection and Enforcement Program Trust Fund, for transfer to the commission’s Utilities Reimbursement Account in the General Fund, which shall be used, upon appropriation by the Legislature, for purposes of Chapter 4.1 (commencing with Section 4451) of Division 2 of the Public Utilities Code. The surcharge shall be assessed on a per space or lot basis, shall not exceed twenty-five cents ($0.25) per month, and shall be collected by the commission on an annual basis.
Notwithstanding any other provision of law or local ordinance, rule, regulation, or initiative measure, the operator shall be entitled to recover the surcharge collected pursuant to subdivision (a) from its customers. However, the charge to any customer, to allow for the operator’s recovery, shall not exceed the actual surcharge.
The commission may adopt rules and orders to carry out this chapter.
In each distribution system, the operator shall post on the premises the current emergency telephone numbers for, at a minimum, the operator, the supplier, the fire department, and the responsible person as defined by Section 18603 of the Health and Safety Code, and shall maintain on the premises a copy of the emergency procedures that shall be used in the event there is a propane leak or other safety hazard in the distribution system. The operator shall inform each of the customers of the location of these emergency telephone numbers and the emergency procedure.
Prior to January 1, 1996, the Occupational Safety and Health Standards Board shall adopt by reference the 1992 edition of NFPA 58 Standard for the Storage and Handling of Liquified Petroleum Gasses, or as that 1992 edition may be subsequently amended or supplemented. It is the intent of the Legislature that the NFPA 58 Standard supersede any inconsistent state standards, including, but not limited to, Sections 470 to 494, inclusive, of Chapter 4 of Title 8 of the California Administrative Code. Nothing in this section prohibits the Occupational Safety and Health Standards Board from adopting more stringent standards than those in NFPA 58.
This chapter hereby creates a trust fund known as the propane safety inspection and enforcement program trust fund. The trust fund shall be administered by the commission.
The trust fund shall be used to partially support the funding requirements of the propane safety inspection and enforcement program of the commission pursuant to this chapter.
Notwithstanding any other provision of law, this chapter, as added by Chapter 388 of the Statutes of 1994, shall not be implemented unless sufficient federal funding has been annually appropriated to the Public Utilities Commission to ensure that only those charges specifically fixed by law, and no additional charges shall, directly or indirectly, be passed on to California consumers.
The commission in administering the trust fund, shall be responsible for the identification of the pertinent operators and for the collection of the surcharges from the operators.
The commission may use a balancing account, in conjunction with the trust fund, to account for any overcollection or undercollection on a yearly basis.
The commission’s administrative responsibility and surcharge collection shall exempt all propane used by the following:
Agricultural, commercial serving less than 10 customers unless a portion of the system is located in a public place, industrial, and refinery systems.
Recreational vehicles and appliances.
Vehicular fuel.
Single customers served by single tanks.
Distribution systems, other than mobilehome parks, which serve less than 10 customers, unless a portion of the system is located in a public place.
Cylinder exchange operations.
If any operator subject to this chapter is in default of the payment of the surcharge required by this chapter for a period of 30 days or more, the commission may estimate from all available information the appropriate fee and may add to the amount of the estimated fee a penalty not to exceed 25 percent of the amount on account of the failure, refusal, or neglect to pay the fee, and the operator shall be estopped to complain of the amount of the commission’s estimate.
The commission may bring an action, in its own name or in the name of the people of the state, in any court of competent jurisdiction, for the collection of delinquent fees estimated under subdivision (a) of this section, together with a penalty of 25 percent for the delinquency.
CHAPTER 8. Charter-Party Carriers of Passengers [5351. - 5450.]
ARTICLE 1. General Provisions and Definitions [5351. - 5363.]
This chapter may be cited as the “Passenger Charter-party Carriers’ Act.”
The use of the public highways for the transportation of passengers for compensation is a business affected with a public interest. It is the purpose of this chapter to preserve for the public full benefit and use of public highways consistent with the needs of commerce without unnecessary congestion or wear and tear upon the highways; to secure to the people adequate and dependable transportation by carriers operating upon the highways; to secure full and unrestricted flow of traffic by motor carriers over the highways which will adequately meet reasonable public demands by providing for the regulation of all transportation agencies with respect to accident indemnity so that adequate and dependable service by all necessary transportation agencies shall be maintained and the full use of the highways preserved to the public; and to promote carrier and public safety through its safety enforcement regulations.
To achieve the purposes of subdivision (a) the commission shall do all of the following:
Prioritize the timely processing of applications and hold “application workshops” for potential applicants around the state.
Enable electronic filing of applications, reports, and fee payments.
Dedicate staff to answering telephone calls, mailings, and electronic inquiries from carriers.
Prioritize the timely processing of consumer complaints.
Implement electronic case tracking of complaints and their disposition.
Implement a process for appropriate and timely enforcement against illegally operating carriers, including by performing staff-driven investigations and performing enforcement through sting operations and other forms of presence in the field.
Maintain relationships with, and implement outreach and education programs to, local law enforcement, district attorneys, and airports, and coordinate with law enforcement agencies pursuant to subdivision (d) of Section 1046, subdivision (d) of Section 5317.5, and subdivision (d) of Section 5417.5.
Meet with carrier trade associations at least annually.
Implement a consolidated case tracking system that integrates each of the transportation program core functions and data collection, administrative compliance details, complaints, and investigations.
This chapter does not apply to any of the following:
Transportation service rendered wholly within the corporate limits of a single city or city and county and licensed or regulated by ordinance.
Transportation of school pupils conducted by or under contract with the governing board of any school district entered into pursuant to the Education Code.
Common carrier transportation services between fixed termini or over a regular route that are subject to authorization pursuant to Article 2 (commencing with Section 1031) of Chapter 5 of Part 1 of Division 1.
Transportation services occasionally afforded for farm employees moving to and from farms on which employed when the transportation is performed by the employer in an owned or leased vehicle, or by a nonprofit agricultural cooperative association organized and acting within the scope of its powers under Chapter 1 (commencing with Section 54001) of Division 20 of the Food and Agricultural Code, and without any requirement for the payment of compensation therefor by the employees.
Transportation service rendered by a publicly owned transit system.
Passenger vehicles carrying passengers on a noncommercial enterprise basis.
Taxicab transportation service licensed and regulated by a city or county, by ordinance or resolution, rendered in vehicles designed for carrying not more than eight persons excluding the driver.
Transportation of persons between home and work locations or of persons having a common work-related trip purpose in a vehicle having a seating capacity of 15 passengers or less, including the driver, which are used for the purpose of ridesharing, as defined in Section 522 of the Vehicle Code, when the ridesharing is incidental to another purpose of the driver. This exemption also applies to a vehicle having a seating capacity of more than 15 passengers if the driver files with the commission evidence of liability insurance protection in the same amount and in the same manner as required for a passenger stage corporation, and the vehicle undergoes and passes an annual safety inspection by the Department of the California Highway Patrol. The insurance filing shall be accompanied by a one-time filing fee of seventy-five dollars ($75). This exemption does not apply if the primary purpose for the transportation of those persons is to make a profit. “Profit,” as used in this subdivision, does not include the recovery of the actual costs incurred in owning and operating a vanpool vehicle, as defined in Section 668 of the Vehicle Code.
Vehicles used exclusively to provide medical transportation, including vehicles employed to transport developmentally disabled persons for regional centers established pursuant to Chapter 5 (commencing with Section 4620) of Division 4.5 of the Welfare and Institutions Code.
Transportation services rendered solely within the Lake Tahoe Basin, comprising that area included within the Tahoe Regional Planning Compact as set forth in Section 66801 of the Government Code, when the operator of the services has obtained any permit required from the Tahoe Basin Transportation Authority or the City of South Lake Tahoe, or both.
Subject to Section 34507.6 of the Vehicle Code, transportation service provided by the operator of an automobile rental business in vehicles owned or leased by that operator, without charge other than as may be included in the automobile rental charges, to carry its customers to or from its office or facility where rental vehicles are furnished or returned after the rental period.
Subject to Section 34507.6 of the Vehicle Code, transportation service provided by the operator of a hotel, motel, or other place of temporary lodging in vehicles owned or leased by that operator, without charge other than as may be included in the charges for lodging, between the lodging facility and an air, rail, water, or bus passenger terminal or between the lodging facility and any place of entertainment or commercial attraction, including, but not limited to, facilities providing snow skiing. Nothing in this subdivision authorizes the operator of a hotel, motel, or other place of temporary lodging to provide any round trip sightseeing service without a permit, as required by subdivision (c) of Section 5384.
Transportation of hot air balloon ride passengers in a balloon chase vehicle from the balloon landing site back to the original takeoff site, provided that the balloon ride was conducted by a balloonist who meets all of the following conditions:
Does not fly more than a total of 30 passenger rides for compensation annually.
Does not provide any preflight ground transportation services in their vehicles.
In providing return transportation to the launch site from landing does not drive more than 300 miles annually.
Files with the commission an exemption declaration and proof of vehicle insurance, as prescribed by the commission, certifying that the operator qualifies for the exemption and will maintain minimum insurance on each vehicle of one hundred thousand dollars ($100,000) for injury or death of one person, three hundred thousand dollars ($300,000) for injury or death of two or more persons and one hundred thousand dollars ($100,000) for damage to property.
Nothing in this subdivision authorizes the operator of a commercial balloon operation to provide any round trip sightseeing service without a permit, as required by subdivision (c) of Section 5384.
Transportation services incidental to operation of a youth camp that are provided by either a nonprofit organization that qualifies for tax exemption under Section 501(c)(3) of the Internal Revenue Code or an organization that operates an organized camp, as defined in Section 18897 of the Health and Safety Code, serving youth 18 years of age or younger.
Any transportation service described in paragraph (1) shall comply with all of the following requirements:
Register as a private carrier with the commission pursuant to Section 4005.
Participate in a pull notice system for employers of drivers as prescribed in Section 1808.1 of the Vehicle Code.
Ensure compliance with the annual bus terminal inspection required by subdivision (c) of Section 34501 of the Vehicle Code.
Obtain the following minimum amounts of general liability insurance coverage for vehicles that are used to transport youth:
A minimum of five hundred thousand dollars ($500,000) general liability insurance coverage for passenger vehicles designed to carry up to eight passengers. For organized camps, as defined in Section 18897 of the Health and Safety Code, an additional two hundred fifty thousand dollars ($250,000) general umbrella policy that covers vehicles.
A minimum of one million dollars ($1,000,000) general liability insurance coverage for vehicles designed to carry up to 15 passengers. For organized camps, as defined in Section 18897 of the Health and Safety Code, an additional five hundred thousand dollars ($500,000) general umbrella policy that covers vehicles.
A minimum of one million five hundred thousand dollars ($1,500,000) general liability insurance coverage for vehicles designed to carry more than 15 passengers, and an additional three million five hundred thousand dollars ($3,500,000) general umbrella liability insurance policy that covers vehicles.
On and after July 1, 1989, this chapter does not apply to transportation service, other than transportation service furnished in a limousine for hire, rendered wholly within the corporate limits of a single city or city and county and licensed or regulated by ordinance.
In construing and enforcing the provisions of this chapter relating to the prescribed privileges and obligations of the holder of a permit or certificate issued hereunder, the act, omission, or failure of any officer, agent, or employee, or person offering to afford the authorized service with the approval or consent of the permit or certificate holder, is the act, omission, or failure of the permit or certificate holder.
Unless the context otherwise requires, the definitions and general provisions set forth in this article govern the construction of this chapter.
“Chartering party” means the person, corporation, or other entity that prearranges with a charter-party carrier of passengers for transportation services.
“Designee” means a person who is 25 years of age or older and who is designated by the chartering party as being the person responsible for compliance with the requirements of Section 5384.1 during the provision of transportation services whenever persons under 21 years of age are to be transported unaccompanied by a parent or legal guardian. If the chartering party is a person and the minor is not accompanied by a parent or legal guardian, the chartering party shall be the designee unless the chartering party identifies another person to be the designee and the person so designated acknowledges and agrees that he or she is the designee. If there is more than one chartering party for a joint carriage of passengers, each chartering party shall designate a designee who is responsible for compliance with the requirements of Section 5384.1 whenever persons under 21 years of age are to be transported unaccompanied by a parent or legal guardian, and that person shall be the designee only for those passengers provided with transportation services on behalf of that chartering party.
“Corporation” includes a corporation, a company, an association, and a joint stock association.
“Person” includes an individual, a firm, or a copartnership.
“Public highway” includes every public street, road, or highway in this State.
“Motor vehicle” means a vehicle which is self-propelled.
“Bus” means a vehicle designed, used, or maintained for carrying more than 10 persons, including the driver, which is used to transport persons for compensation or profit.
“Limousine” means any sedan or sport utility vehicle, of either standard or extended length, with a seating capacity of not more than 10 passengers including the driver, used in the transportation of passengers for hire on a prearranged basis within this state, and includes a modified limousine as defined in subdivision (d) of Section 1042.
Subject to the exclusions of Section 5353, “charter-party carrier of passengers” means every person engaged in the transportation of persons by motor vehicle for compensation, whether in common or contract carriage, over any public highway in this state. “Charter-party carrier of passengers” includes any person, corporation, or other entity engaged in the provision of a hired driver service when a rented motor vehicle is being operated by a hired driver.
Charter-party carriers of passengers shall operate on a prearranged basis within this state.
For purposes of this section, “prearranged basis” means that the transportation of the prospective passenger was arranged with the carrier by the passenger, or a representative of the passenger, either by written contract or telephone.
“Modified limousine” means any vehicle that has been modified, altered, or extended in a manner that increases the overall wheelbase of the vehicle, exceeding the original equipment manufacturer’s published wheelbase dimension for the base model and year of the vehicle, in any amount sufficient to accommodate additional passengers with a seating capacity of not more than 10 passengers including the driver, and is used in the transportation of passengers for hire. For purposes of this section, “wheelbase” means the longitudinal distance between the vertical centerlines of the front and rear wheels.
With respect to a motor vehicle used in the transportation of persons for compensation by a charter-party carrier of passengers, “owner” means the corporation or person who is registered with the Department of Motor Vehicles as the owner of the vehicle, or who has a legal right to possession of the vehicle pursuant to a lease or rental agreement.
Any provision of the Public Utilities Act (Part 1 (commencing with Section 201) of Division 1) or of this chapter applicable to charter bus transportation that conflicts with the federal Transportation Equity Act for the 21st Century (P.L. 105-178) does not apply to charter bus transportation to the extent of that conflict. If any provision of the Public Utilities Act or of this chapter applicable to charter bus transportation, or the application thereof to any person or circumstance, is invalid as a result of federal preemption, the remainder of the act, or the application of the provision to other persons or circumstances, shall not be affected thereby.
Except as specified in paragraph (2), as used in this section, “charter bus transportation” means transportation, using a vehicle designed, used, or maintained for carrying more than 10 persons, including the driver, of a group of persons who, pursuant to a common purpose, under a single contract, at a fixed charge for the motor vehicle, have acquired the exclusive use of the motor vehicle to travel together.
If a federal court or agency with the jurisdiction to construe Section 14501(a)(1)(C) of Title 49 of the United States Code determines that additional transportation falls within the meaning of the term “charter bus transportation,” as used in that section, the federal construction of that term shall prevail.
ARTICLE 2. Authorization to Operate as a Charter-Party Carrier of Passengers [5371. - 5379.5.]
No charter-party carrier of passengers excepting transit districts, transit authorities or cities owning and operating local transit systems themselves or through wholly owned nonprofit corporations shall engage in transportation services made subject to this chapter without first having obtained from the commission a certificate that public convenience and necessity require the operation, except that certain specific transportation services as defined in Section 5384 may be conducted under authority of a permit issued by the commission.
No charter-party carrier of passengers issued a class A certificate subject to this section shall be restricted as to point of origin or destination in the State of California.
Every application for a certificate or permit, or renewal thereof, shall be accompanied by the appropriate fee as specified in Section 5373.1.
All holders of certificates issued under this section shall operate from a service area to be determined by the commission. In no case shall this area encompass more than a radius of 125 air miles from the home terminal. The home terminal shall be designated by the applicant. This certificate shall be classified as a class B certificate. This section shall not apply to certificates subject to Section 5371.1.
The restriction on a service area imposed by subdivision (a) does not apply to the holder of a class B certificate if that person is providing charter bus transportation as defined in subdivision (b) of Section 5363.
The governing body of any city, county, or city and county may not impose a fee on charter-party carriers operating limousines. However, the governing body of any city, county, or city and county may impose a business license fee on, and may adopt and enforce any reasonable rules and regulations pertaining to operations within its boundaries for, any charter-party carrier domiciled or maintaining a business office within that city, county, or city and county.
The governing body of any airport may not impose vehicle safety, vehicle licensing, or insurance requirements on charter-party carriers operating limousines that are more burdensome than those imposed by the commission. However, the governing board of any airport may require a charter-party carrier operating limousines to obtain an airport permit for operating authority at the airport.
Notwithstanding subdivisions (a) and (b), the governing body of any airport may adopt and enforce reasonable and nondiscriminatory local airport rules, regulations, and ordinances pertaining to access, use of streets and roads, parking, traffic control, passenger transfers, trip fees, and occupancy, and the use of buildings and facilities, that are applicable to charter-party carriers operating limousines on airport property.
The governing body of any airport shall not impose a fee based on gross receipts of charter-party carriers operating limousines.
Notwithstanding subdivisions (a) to (e), inclusive, nothing in this section prohibits a city, county, city and county, or the governing body of any airport, from adopting and enforcing reasonable permit requirements, fees, rules, and regulations applicable to charter-party carriers of passengers other than those operating limousines.
Notwithstanding subdivisions (a) to (e), inclusive, a city, county, or city and county may impose reasonable rules for the inspection of waybills of charter-party carriers of passengers operating within the jurisdiction of the city, county, or city and county, for purposes of verifying valid prearranged travel.
For the purposes of this section, “limousine” includes any sedan or sport utility vehicle, of either standard or extended length, with a seating capacity of not more than 10 passengers including the driver, used in the transportation of passengers for hire on a prearranged basis within this state.
Upon receipt of a complaint containing sufficient information to warrant conducting an investigation, the commission shall investigate any business that advertises limousine-for-hire or passenger charter transportation service for compensation in motor vehicles. The commission shall, in a rulemaking or other appropriate procedure, adopt criteria that establishes the type of information, if contained in a complaint, that is sufficient to warrant an investigation. Pursuant to this investigation, the commission shall do all of the following:
Determine which businesses, if any, are required to have in effect a passenger charter-party carrier certificate or permit pursuant to Section 5371 but do not have the required certificate or permit.
Inform any business not having a required certificate or permit that it is in violation of law.
Within 60 days of informing the business pursuant to paragraph (2), institute civil or criminal proceedings, or both, pursuant to Article 6 (commencing with Section 5411) or any other applicable law.
For the purposes of this section, “advertises” includes the undertaking of any action described in subdivision (b) of Section 5386.
The Legislature finds and declares that advertising and use of telephone service is essential for charter-party carriers of passengers to obtain business and to conduct intrastate passenger transportation services. Unlawful advertisements by unlicensed charter-party carriers of passengers has resulted in properly licensed and regulated charter-party carriers of passengers competing with unlicensed charter-party carriers of passengers using unfair business practices. Unlicensed charter-party carriers of passengers have also exposed citizens of the state to unscrupulous persons who portray themselves as properly licensed, qualified, and insured charter-party carriers of passengers. Many of these unlicensed charter-party carriers of passengers have been found to have operated their vehicles without insurance or in an unsafe manner, placing the citizens of the state at risk.
The Legislature finds and declares that the termination of telephone service utilized by unlicensed charter-party carriers of passengers is essential to ensure the public safety and welfare. Therefore, the commission should take enforcement action as specified in this section to disconnect telephone service of unlicensed charter-party carriers of passengers who unlawfully advertise passenger transportation services in yellow page directories and other publications. The enforcement actions provided for by this section are consistent with the decision of the California Supreme Court in Goldin v. Public Utilities Commission (1979) 23 Cal.3d 638.
For purposes of this section, a telephone corporation or telegraph corporation, or a corporation that holds a controlling interest in the telephone or telegraph corporation, or any business that is a subsidiary or affiliate of the telephone or telegraph corporation, that has the name and address of the subscriber to a telephone number being used by an unlicensed charter-party carrier of passengers shall provide the commission, or an authorized officer or employee of the commission, upon demand, and the order of a magistrate, access to this information. A magistrate may only issue an order, for the purposes of this subdivision, if the magistrate has made the findings required by subdivision (c).
A telephone or telegraph corporation shall refuse telephone service to a new subscriber and shall disconnect telephone service of an existing subscriber only after it is shown that other available enforcement remedies of the commission have failed to terminate unlawful activities detrimental to the public welfare and safety, and upon receipt from any authorized officer or employee of the commission of a writing, signed by a magistrate, as defined by Sections 807 and 808 of the Penal Code, finding that probable cause exists to believe that the subscriber is advertising or holding out to the public to perform, or is performing, charter-party carrier of passengers transportation services without having in force a permit or certificate issued by the commission authorizing those services, or that the telephone service otherwise is being used or is to be used as an instrumentality, directly or indirectly, to violate or to assist in violation of the laws requiring a charter-party carrier of passengers permit or certificate. Included in the writing of the magistrate shall be a finding that there is probable cause to believe that the subject telephone facilities have been or are to be used in the commission or facilitation of holding out to the public to perform, or in performing, charter-party carrier of passengers transportation services without having in force a permit or certificate issued by the commission authorizing those services, and that, absent immediate and summary action, a danger to public welfare or safety will result.
Any person aggrieved by any action taken pursuant to this section shall have the right to file a complaint with the commission and may include therein a request for interim relief. The commission shall schedule a public hearing on the complaint to be held within 21 calendar days of the filing and assignment of a docket number to the complaint. The remedy provided by this section shall be exclusive. No other action at law or in equity shall accrue against any telephone or telegraph corporation because of, or as a result of, any matter or thing done or threatened to be done pursuant to this section.
At any hearing held on a complaint filed with the commission pursuant to subdivision (d), the commission staff shall have the right to participate, including the right to present evidence and argument and to present and cross-examine witnesses. The commission staff shall have both the burden of providing that the use made or to be made of the telephone service is to hold out to the public to perform, or to assist in performing, services as a charter-party carrier of passengers, or that the telephone service is being or is to be used as an instrumentality, directly or indirectly, to violate or to assist in violation of the certification or permitting requirements applicable to charter-party carriers of passengers and that the character of the acts are such that, absent immediate and summary action, a danger to public welfare or safety will result, and the burden of persuading the commission that the telephone services should be refused or should not be restored.
The telephone or telegraph corporation, immediately upon refusal or disconnection of service in accordance with subdivision (c), shall notify the subscriber in writing that the refusal or disconnection of telephone service has been made pursuant to a request of the commission and the writing of a magistrate, and shall include with the notice a copy of this section, a copy of the writing of the magistrate, and a statement that the customer or subscriber may request information from the commission at its San Francisco or Los Angeles office concerning any provision of this section and the manner in which a complaint may be filed.
The provisions of this section are an implied term of every contract for telephone service. The provisions of this section are a part of any application for telephone service. Applicants for, and subscribers and customers of, telephone service have, as a matter of law, consented to the provisions of this section as a consideration for the furnishing of the telephone service.
As used in this section, the terms “person,” “customer,” and “subscriber” include a subscriber to telephone service, any person using the telephone service of a subscriber, an applicant for telephone service, a corporation, as defined in Section 204, a “person” as defined in Section 205, a limited liability company, a partnership, an association, and includes their lessees and assigns.
As used in this section, “telephone corporation” means a “telephone corporation” as defined in Section 234.
As used in this section, “telegraph corporation” means a “telegraph corporation” as defined in Section 236.
As used in this section, “authorized officer or employee of the commission” includes the executive director of the commission or any commission employee designated pursuant to paragraph (5) of subdivision (a) of Section 830.11 of the Penal Code.
Applications for permits and certificates shall be in writing, verified under oath, and shall be in such form, contain such information, and be accompanied by such proof of service upon interested parties as the commission may require.
Each application for a charter-party carrier of passengers certificate or permit shall be accompanied by a filing fee as follows:
Class A certificates (new): one thousand five hundred dollars ($1,500).
Class A certificates (renewal): one hundred dollars ($100).
Class B certificates (new): one thousand dollars ($1,000).
Class B certificates (renewal): one hundred dollars ($100).
Class C certificates (new): one thousand dollars ($1,000).
Class C certificates (renewal): one hundred dollars ($100).
Permits (new): one thousand dollars ($1,000).
Permits (renewal): one hundred dollars ($100).
The commission shall also require each application to be accompanied by a fee to offset the cost of the charter-party carrier bus terminal inspections conducted by the Department of the California Highway Patrol. The fee shall be fifteen dollars ($15) per tour bus, as defined in Section 612 of the Vehicle Code, or a maximum of six thousand five hundred dollars ($6,500) for each operating carrier.
The commission shall require each charter-party carrier that operates tour buses, as defined in Section 612 of the Vehicle Code, to undergo an annual bus terminal inspection conducted by the Department of the California Highway Patrol and to pay an annual fee of fifteen dollars ($15) per tour bus, or a maximum of six thousand five hundred dollars ($6,500), to offset the cost of the inspections.
The commission shall deposit the fees collected pursuant to subdivisions (b) and (c) in the Motor Vehicle Account in the State Transportation Fund to cover the costs of the inspections conducted by the department as specified in subdivisions (b) and (c).
The commission shall not issue or authorize the transfer of any certificate or permit under this chapter to any person or corporation against whom a final judgment has been entered and whose name has been transmitted to the commission pursuant to Section 3716.4 of the Labor Code, unless that judgment has been satisfied or has been discharged in accordance with the bankruptcy laws of the United States.
Before a permit or certificate is issued or renewed, the commission shall require the applicant to establish reasonable fitness and financial responsibility to initiate and conduct or continue to conduct the proposed or existing transportation services. The commission shall not issue or renew a permit or certificate pursuant to this chapter unless the applicant meets all of the following requirements:
It is financially and organizationally capable of conducting an operation that complies with the rules and regulations of the Department of the California Highway Patrol governing highway safety.
It is committed to observing the hours of service regulations of state and, where applicable, federal law, for all persons, whether employees or subcarriers, operating vehicles in transportation for compensation under the certificate.
It has a preventive maintenance program in effect for its vehicles used in transportation for compensation that conforms to regulations of the Department of the California Highway Patrol in Title 13 of the California Code of Regulations.
It participates in a program to regularly check the driving records of all persons, whether employees or subcarriers, operating vehicles used in transportation for compensation.
It has a safety education and training program in effect for all employees or subcarriers operating vehicles used in transportation for compensation.
It will maintain its vehicles used in transportation for compensation in a safe operating condition and in compliance with the Vehicle Code and with regulations contained in Title 13 of the California Code of Regulations relative to motor vehicle safety.
It has filed with the commission the certificate of workers’ compensation insurance coverage or statement required by Section 5378.1.
It has provided the commission an address of an office or terminal where documents supporting the factual matters specified in the showing required by this subdivision may be inspected by the commission and the Department of the California Highway Patrol.
It provides for a mandatory controlled substance and alcohol testing certification program as adopted by the commission pursuant to Section 1032.1.
Subparagraphs (C), (F), and (H) do not apply to a charter-party carrier of passengers engaged in the provision of a hired driver service when a rented motor vehicle is being operated by the hired driver.
With respect to subparagraphs (B) and (F) of paragraph (1), the commission may base a finding on a certification by the commission that an applicant has filed, with the commission, a sworn declaration of ability to comply and intent to comply.
The commission may require, as a precondition to the issuance of a permit or certificate, the procurement of a performance bond sufficient to facilitate the collection of fines, penalties, and restitution related to enforcement actions that can be taken against the applicant.
In addition to the requirements in subdivision (a), charter-party carriers shall meet all other state and, where applicable, federal regulations as prescribed.
The commission may delegate to its executive director or that executive director’s designee the authority to issue, renew, or authorize the transfer of, charter-party carrier permits or certificates and to make the findings specified in subdivision (a) that are necessary to that delegated authority.
At the time of each bus terminal inspection conducted by the Department of the California Highway Patrol pursuant to subdivision (c) of Section 34501 of the Vehicle Code, every charter-party carrier of passengers shall furnish both the Department of the California Highway Patrol and the commission a list, prepared under oath, of all vehicles used in transportation for compensation during the period since the last inspection. The commission shall furnish a copy of the list to the carrier’s insurer, if the carrier’s accident liability protection is provided by a policy of insurance. This subdivision does not apply to a charter-party carrier of passengers engaged in the provision of a hired driver service when a rented motor vehicle is being operated by the hired driver.
If the charter-party carrier’s insurer informs the commission that the carrier has failed to obtain insurance coverage for any vehicle reported on the list, the commission may, in addition to any other penalty provided in this chapter, for a first occurrence, suspend the carrier’s certificate or permit or impose a fine, or both, and for a second or subsequent occurrence may suspend or revoke the certificate or impose a fine, or both.
Every charter-party carrier earning over three hundred fifty thousand dollars ($350,000) in annual gross operating revenue shall, under oath, file annually a report indicating the number, classification, and compensation of all employees and owner-operator drivers hired or engaged during the reporting period. The commission shall submit a copy of the report to the administrator of the carrier’s workers’ compensation self-insurance plan if the carrier is self-insured, or to the carrier’s workers’ compensation insurer if the carrier’s workers’ compensation protection is provided by a policy or policies of insurance. The commission shall not be obligated to undertake an independent investigation of the adequacy of workers’ compensation insurance coverage based on the information contained in the report, if the carrier has complied with Section 5378.1.
The commission may, with or without hearing, issue or refuse to issue a permit or certificate. If the commission finds that public convenience and necessity require the proposed transportation service and the applicant possess satisfactory fitness and financial responsibility to initiate and conduct the proposed transportation services, and will faithfully comply with the rules and regulations adopted by the commission with respect thereto, it shall issue the permit or certificate to conduct the requested operations, or may issue it for the partial exercise of the privilege sought, and may attach to the permit or certificate such terms and conditions as, in its judgment, are required in the public interest; provided also that the permit or certificate shall not require the filing or publication of time schedules or tariffs. The fact that the applicant for the certificate is, or may later become a holder of a certificate of public convenience and necessity as a passenger stage corporation issued pursuant to the provisions of Article 2 (commencing with Section 1031), Chapter 5, Part 1, Division 1, of this code shall not be deemed inconsistent with the provisions of this section, and such dual authority may be authorized.
A permit or certificate, or renewal thereof, is effective for three years, unless suspended or revoked by the commission.
No permit issued pursuant to this article, or rights to conduct any of the services therein authorized, shall be sold, leased, or assigned, or otherwise transferred or encumbered.
No certificate issued pursuant to, or rights to conduct any of the services authorized by, this article shall be sold, leased, or assigned, or otherwise transferred or encumbered, unless authorized by the commission. A filing fee of three hundred dollars ($300) shall accompany all applications.
The commission may cancel, revoke, or suspend any operating permit or certificate issued pursuant to this chapter upon any of the following grounds:
The violation of any of the provisions of this chapter, or of any operating permit or certificate issued thereunder.
The violation of any order, decision, rule, regulation, direction, demand, or requirement established by the commission pursuant to this chapter.
The conviction of the charter-party carrier of passengers of any misdemeanor under this chapter while holding operating authority issued by the commission or the conviction of the carrier or its officers of a felony while holding operating authority issued by the commission, limited to robbery, burglary, larceny, fraud, or intentional dishonesty for personal gain.
The rendition of a judgment against the charter-party carrier of passengers for any penalty imposed under this chapter.
The failure of a charter-party carrier of passengers to pay any fee imposed upon the carrier within the time required by law.
On request of the holder of the permit or certificate.
Failure of a permit or certificate holder to operate and perform reasonable service. That failure may include repeated violations of the Vehicle Code or of regulations contained in Title 13 of the California Code of Regulations relative to motor vehicle safety, by employees of the permitholder or certificate holder, that support an inference of unsafe operation or willful neglect of the public safety by the permitholder or certificate holder.
Consistent failure of the charter-party carrier of passengers to maintain its vehicles in a safe operating condition and in compliance with the Vehicle Code and with regulations contained in Title 13 of the California Code of Regulations relative to motor vehicle safety, as shown by the records of the commission, the Department of Motor Vehicles, the Department of the California Highway Patrol, or the carrier. This paragraph does not apply to a charter-party carrier of passengers engaged in the provision of a hired driver service when a rented motor vehicle is being operated by the hired driver.
The knowing and willful filing of a false report that understates revenues and fees.
Failure of a permit or certificate holder, or of any of its employees, to follow any order, decision, rule, regulation, direction, demand, ordinance, or other requirement established by the governing body of an airport, including solicitation practices.
The commission may levy a civil penalty of up to seven thousand five hundred dollars ($7,500) upon the holder of an operating permit or certificate issued pursuant to this chapter, for any of the grounds specified in subdivision (a), as an alternative to canceling, revoking, or suspending the permit or certificate. The commission may also levy interest upon the civil penalty, which shall be calculated as of the date on which the civil penalty is unpaid and delinquent. The commission shall deposit at least monthly all civil penalties and interest collected pursuant to this section into the General Fund.
Beginning July 1, 1990, and continuing thereafter, every charter-party carrier shall file with the commission one of the following:
A certificate of workers’ compensation coverage for its employees issued by an admitted insurer.
A certification of consent to self-insure issued by the Director of Industrial Relations.
A statement under penalty of perjury, stating that, in its operations as a charter-party carrier, it does not employ any person in any manner so as to become subject to the workers’ compensation laws of this state.
The workers’ compensation certified to under paragraph (1) of subdivision (a) shall be effective until canceled. Cancellation shall require 30 days’ advance notice.
If, after filing the statement described in paragraph (3) of subdivision (a), the carrier becomes subject to the workers’ compensation laws of this state, the carrier shall promptly notify the commission that the carrier is withdrawing its statement under paragraph (3) of subdivision (a), and shall simultaneously file the certificate described in either paragraph (1) or (2) of subdivision (a).
The commission may adopt rules and regulations that it determines to be necessary to carry out this section.
Upon receipt of a written recommendation from the Department of the California Highway Patrol that the certificate or permit of a charter-party carrier be suspended either (1) for failure to maintain any vehicle used in transportation for compensation in a safe operating condition or to comply with the Vehicle Code or with regulations contained in Title 13 of the California Code of Regulations relative to motor carrier safety if that failure is either a consistent failure or presents an imminent danger to public safety, or (2) for failure to enroll all drivers in the pull notice system as required by Section 1808.1 of the Vehicle Code, the commission shall, pending a hearing in the matter pursuant to subdivision (d), suspend the carrier’s certificate or permit. The written recommendation shall specifically indicate compliance with subdivision (c).
A carrier whose certificate or permit is suspended pursuant to subdivision (a) may obtain a reinspection of its terminal and vehicles by the department, by submitting a written request for reinstatement to the commission and paying a reinstatement fee of one thousand dollars ($1,000). The commission shall deposit all reinstatement fees collected pursuant to this subdivision in the Public Utilities Commission Transportation Reimbursement Account. The commission shall then forward a request for reinspection to the department which shall then perform a reinspection within a reasonable time. The commission shall reinstate a carrier’s certificate or permit suspended under subdivision (a) promptly upon receipt of a written recommendation from the department that the carrier’s safety compliance has improved to the satisfaction of the department, unless the certificate or permit is suspended for another reason, or has been revoked.
Before transmitting a recommendation pursuant to subdivision (a) to the commission, the Department of the California Highway Patrol shall notify the charter-party carrier in writing of all of the following:
That the department has determined that the carrier’s safety record is unsatisfactory, furnishing a copy of any documentation or summary of any other evidence supporting the determination.
That the determination may result in suspension or revocation of the carrier’s certificate or permit by the commission.
That the carrier may request a review of the determination by the department within five days of its receipt of the notice required under this subdivision. If a review pursuant to this paragraph is requested by the carrier, the department shall conduct and evaluate that review prior to transmitting any notification to the commission pursuant to subdivision (a).
Whenever the commission suspends the certificate or permit of any charter-party carrier pursuant to subdivision (a), the commission shall furnish the carrier written notice of the suspension and shall hold a hearing within a reasonable time, not to exceed 21 days, after a written request therefor is filed with the commission, with a copy thereof furnished to the Department of the California Highway Patrol. At the hearing, the carrier shall show cause why the suspension should not be continued. At the conclusion of the hearing, the commission may, in addition to any other penalty provided in this chapter, terminate the suspension, continue the suspension in effect, or revoke the certificate or permit. The commission may revoke the certificate or permit of any carrier suspended pursuant to subdivision (a) at any time 90 days or more after its suspension if the commission has not received a written recommendation for reinstatement from the department and the carrier has not filed a written request for a hearing with the commission.
If the commission, after a hearing, finds that a charter-party carrier has continued to operate as such a carrier after its certificate or permit has been suspended pursuant to subdivision (a), the commission shall do one of the following:
Revoke the operating certificate or permit of the carrier.
Impose upon the holder of the certificate or permit a civil penalty of not less than one thousand five hundred dollars ($1,500) nor more than seven thousand five hundred dollars ($7,500) for each day of unlawful operations.
The commission shall deny a new or renewal application for a charter-party carrier certificate or permit upon receipt of a written recommendation from the Department of the California Highway Patrol that specifically indicates compliance with subdivision (b), and indicates that the applicant has failed to do either of the following:
Maintain any vehicle used in transportation for compensation in a safe operating condition or to comply with the Vehicle Code or the regulations contained in Title 13 of the California Code of Regulations relative to motor carrier safety. This paragraph does not apply to a charter-party carrier of passengers engaged in the provision of a hired driver service when a rented motor vehicle is being operated by the hired driver.
Enroll all drivers in the Department of Motor Vehicles’ Employer Pull Notice Program implementing Section 1808.1 of the Vehicle Code.
Before transmitting a recommendation pursuant to subdivision (a) to the commission, the Department of the California Highway Patrol shall notify the applicant for the charter-party carrier certificate or permit of all of the following in writing:
That the department has determined that the applicant’s safety record is unsatisfactory, furnishing a copy of any documentation or summary of any other evidence supporting the determination.
That the determination may result in a denial of the applicant’s certificate or permit by the commission.
That the applicant may request a review of the determination by the department within five days of its receipt of the notice required under this subdivision. The department shall, upon request, conduct and evaluate that review prior to transmitting any notification to the commission pursuant to subdivision (a).
Whenever the commission denies an application for renewal pursuant to subdivision (a), the commission shall furnish the charter-party carrier written notice of the denial and shall hold a hearing within a reasonable time, not to exceed 21 days, after a written request is filed with the commission, with a copy thereof furnished to the Department of the California Highway Patrol. At the hearing, the carrier shall show cause why the denial was improper or unwarranted. At the conclusion of the hearing, the commission may, in addition to any other remedy provided in this part, reverse the denial, or sustain the denial.
Any applicant for a charter-party carrier certificate or permit denied pursuant to subdivision (a), whose denial has not been reversed as a result of the hearing provided for in subdivision (c), that wishes to obtain a certificate or permit shall reapply for the desired authority.
Upon receipt of a stop order issued by the Director of Industrial Relations pursuant to Section 3710.1 of the Labor Code, the commission shall investigate to determine whether the charter-party carrier of passengers has filed a false statement relative to workers’ compensation insurance coverage, in violation of statute, or rules or orders of the commission. If, after notice and opportunity to be heard, the commission determines that there has been a violation of statute, or rules or orders of the commission, the commission shall impose appropriate penalties, which may include a fine and suspension of operating authority for a violation.
Upon receipt of a complaint from the Director of Industrial Relations, that a final judgment has been entered against any charter-party carrier of passengers as a result of an award having been made to an employee pursuant to Section 3716.2 of the Labor Code, the commission shall, 30 days from the date the carrier is mailed the notice, revoke the carrier’s permit unless the judgment has been satisfied or has been discharged in accordance with the bankruptcy laws of the United States or the carrier requests a hearing pursuant to subdivision (c).
Within seven days of receipt of a complaint from the Director of Industrial Relations that a final judgment has been entered against any charter-party carrier of passengers as a result of an award having been made to an employee pursuant to Section 3716.2 of the Labor Code, the commission shall furnish the carrier named in the final judgment written notice of the right to a hearing regarding the complaint and the procedure to follow to request a hearing. The notice shall state that the commission must revoke the carrier’s permit to operate pursuant to subdivision (b) after 30 days from the date the notice is mailed unless the carrier provides proof that the judgment is satisfied or has been discharged in accordance with the bankruptcy laws of the United States and the commission has been so notified seven days prior to the conclusion of the 30-day waiting period. The notice shall also inform the carrier of a right to a hearing and the procedures to follow to request a hearing. The carrier shall have 10 days from the date the notice is sent by the commission to request a hearing. The request for the hearing shall stay the revocation. The hearing shall be held within 30 days of the receipt of the request. If the commission finds that an unsatisfied judgment exists concerning a debt arising under Section 3717 of the Labor Code, the commission shall immediately revoke the carrier’s permit.
After the cancellation or revocation of a permit or certificate, or during the period of its suspension, or after the expiration of its permit or certificate, it is unlawful for a charter-party carrier of passengers to conduct any operations as a carrier. The commission may either grant or deny an application for a new permit or certificate whenever it appears that a prior permit or certificate of the applicant has been canceled or revoked pursuant to Section 5378 or whenever it appears, after hearing, that as a prior permit or certificate holder, the applicant engaged in any of the unlawful activities set forth in Section 5378 for which his or her permit or certificate might have been canceled or revoked.
The commission may, on a complaint alleging that any corporation or person is operating as a charter-party carrier of passengers without a valid certificate or permit in violation of this chapter, or on its own motion without a complaint, with or without notice of a hearing, order the corporation or person so operating to cease and desist from that operation until the commission makes and files its decision in the matter or until further order of the commission.
ARTICLE 3. Regulation of Charter-Party Carriers of Passengers [5381. - 5389.]
To the extent that such is not inconsistent with the provisions of this chapter, the commission may supervise and regulate every charter-party carrier of passengers in the State and may do all things, whether specifically designated in this part, or in addition thereto, which are necessary and convenient in the exercise of such power and jurisdiction.
The commission shall, by rule or other appropriate procedure, ensure that every charter-party carrier of passengers operates on a prearranged basis within the state, consistent with Section 5360.5. The commission shall require every charter-party carrier of passengers to include on a waybill or trip report at least all of the following:
The name of at least one passenger in the traveling party, or identifying information of the traveling party’s affiliation, along with the point of origin and destination of the passenger or traveling party.
Information as to whether the transportation was arranged by telephone, written contract, or electronic communication.
A waybill or trip report may be kept in electronic or hardcopy format. When requested by any commission or airport enforcement officer or any official of a city, county, or city and county authorized to inspect a waybill or trip report pursuant to subdivision (g) of Section 5371.4, the waybill or trip report may be provided in either electronic or hardcopy format.
A charter-party carrier of passengers shall produce in its office a hardcopy of any waybill or trip report when requested by the commission or one of its authorized representatives pursuant to Section 5389.
To the extent that such are not inconsistent with the provisions of this chapter, all general orders, rules and regulations, applicable to the operations of carriers of passengers under authority of certificates of public convenience and necessity issued pursuant to the provisions of Article 2 (commencing at Section 1031), Chapter 5, Part 1, Division 1 of this code, unless otherwise ordered by the commission shall apply to charter-party carriers of passengers.
The commission shall create the following classifications or types of certificates for charter-party carriers of passengers:
Class A: from any point or points within the state to other points in or out of this state, including, but not limited to, the conduction of round-trip sightseeing tour service.
Class B: from any point within the territory of origin specified in the certificate to any points in the state, or territory of origin.
Class C: services provided incidental to commercial balloon operations, commercial river rafting, or skiing where no additional compensation is provided for the transportation.
The commission shall issue permits to persons, who are otherwise qualified, whose passenger carrier operations fall into the following categories:
Specialized carriers, who do not hold themselves out to serve the general public, but only provide service under contract with industrial and business firms, governmental agencies, and private schools or who only transport agricultural workers to and from farms for compensation or who only conduct transportation services, which are incidental to another business. This permit shall be designated as a “Z” permit.
Carriers using only vehicles under 15-passenger seating capacity. This permit shall be designated as a “P” permit.
Carriers conducting round-trip sightseeing tour service. This permit shall be designated as an “S” permit.
At the time transportation service is prearranged or the contract of carriage is made, the charter-party carrier of passengers shall ask the chartering party and, upon being asked, the chartering party shall disclose to the charter-party carrier of passengers, whether the following are true:
Alcoholic beverages will be served by the chartering party or be transported in the passenger compartment of the vehicle during transportation.
A member of the party to be provided with transportation services will be under 21 years of age.
If, at the time transportation was prearranged with the charter-party carrier of passengers, the chartering party discloses that alcoholic beverages will be served or transported in the passenger compartment and a member of the party is under 21 years of age, each of the following applies:
The charter-party carrier of passengers, at the time transportation services are arranged, shall notify the chartering party of all of the following:
A designee who is 25 years of age or older shall be present whenever persons under 21 years of age who are not accompanied by a parent or legal guardian are being transported.
The designee shall make reasonable efforts to ensure compliance with all laws prohibiting the consumption of alcoholic beverages by persons under 21 years of age who are members of the party and are not accompanied by a parent or legal guardian.
The designee shall check the identifications of all passengers to determine who is under 21 years of age and shall read the statement specified in paragraph (7) to each passenger in the party who is under 21 years of age. The driver shall not commence transport until the designee has verified with the driver that the designee has checked the identifications of all passengers and has read the statement. If passengers are picked up at more than one location, the driver shall not commence transport from the subsequent location until the designee has verified with the driver that the designee has checked the identifications of all passengers boarding the vehicle at that location and has read the statement to all passengers boarding the vehicle at that location.
The designee shall notify the driver of the vehicle if, at any time during the trip, a passenger in their party who is under 21 years of age is consuming or has consumed alcoholic beverages.
The designee shall be responsible for any reasonably foreseeable personal injury or property damage that is proximately caused by the consumption of alcoholic beverages by a person under 21 years of age while being supplied with transportation services if the designee knew or reasonably should have known that the person is under 21 years of age or has consumed alcoholic beverages while being supplied with transportation services.
If a trip is terminated because of the consumption of alcoholic beverages by a person under 21 years of age who is a member of their party, the designee’s responsibility for that minor shall continue until that person who is under 21 years of age is returned safely to his or her home or entrusted into the care of his or her parent or legal guardian or taken to a location reasonably believed to be safer than his or her home.
The charter-party carrier of passengers shall provide a copy of the written form described in paragraph (4) to the chartering party and shall verify the written form has been returned with the signature of the designee no later than 72 hours prior to the commencement of the travel date. If the transportation service is prearranged within 72 hours of the travel date, the charter-party carrier of passengers shall immediately provide the written form described in paragraph (4) to the chartering party as a stand-alone form separate from the contract of carriage, to be returned prior to the commencement of transportation services with the signature of the designee. A charter-party carrier of passengers may supply the chartering party with additional forms for a replacement designee in the event the planned designee is unable to accompany the party during transport. The charter-party carrier of passengers shall verify the written form of a replacement designee has been returned with the signature of the replacement designee no later than 72 hours prior to the commencement of the travel date.
If the charter-party carrier of passengers does not provide the written notice specified in subparagraph (A), and the designee does not return the signed form prior to the commencement of the transport, the charter-party carrier of passengers shall do any of the following:
Provide a designee who is not the driver and shall incur any and all liabilities of that designee.
(II) Remove and lock all alcoholic beverages in the vehicle’s trunk or other locked compartment.
(III) Prohibit all persons under 21 years of age from boarding the vehicle.
(IV) Cancel the trip and refund all payments for the transportation services.
A charter-party carrier of passengers that fails to comply with clause (i) shall incur the liabilities of a designee.
The charter-party carrier of passengers shall inform the driver of the vehicle that alcohol will be present and that there will be persons under 21 years of age present during the provision of transportation services and the name of the designee.
The driver of the vehicle shall obtain the designee’s signature or initials on a written form indicating the designee’s acknowledgment and agreement to all of the following:
Alcoholic beverages will be served by the chartering party or be transported in the passenger compartment of the vehicle during transportation.
A member of the party to be provided with transportation services will be under 21 years of age.
The person signing or initialing is the designee and is 25 years of age or older.
The designee shall make reasonable efforts to ensure compliance with all laws prohibiting the consumption of alcoholic beverages by persons under 21 years of age who are members of the party and are not accompanied by a parent or legal guardian.
The designee must check the identifications of all passengers to determine who is under 21 years of age and shall read the statement specified in paragraph (7) to each passenger in the party who is under 21 years of age. The driver will not commence transportation services until the designee has verified with the driver that the designee has checked the identifications of all passengers and has read the statement. If passengers are to be picked up at more than one location, the driver will not commence transport from the subsequent location until the designee has verified with the driver that the designee has checked the identifications of all passengers boarding the vehicle at that location and has read the statement to all passengers boarding the vehicle at that location.
The designee is responsible for notifying the driver of the vehicle if, at any time during the trip, a passenger in their party who is under 21 years of age is consuming or has consumed alcoholic beverages and that the designee is in violation of the law if he or she fails to notify the driver.
The designee is legally responsible for any reasonably foreseeable personal injury or property damage that is proximately caused by the consumption of alcoholic beverages by a person under 21 years of age while being supplied with transportation services if the designee knew or reasonably should have known that the person is under 21 years of age and is consuming or has consumed alcoholic beverages while being supplied with transportation services.
If a trip is terminated because of the consumption of alcoholic beverages by a person under 21 years of age who is a member of their party, the designee’s responsibility for that person under 21 years of age continues until that person who is under 21 years of age is returned safely to his or her home or entrusted into the care of his or her parent or legal guardian or taken to a location reasonably believed to be safer than his or her home.
The designee shall be a passenger of the vehicle during the provision of transportation services and shall make reasonable efforts to ensure the lawful conduct of all persons in the vehicle who are members of the party who are under 21 years of age and who are not accompanied by a parent or legal guardian.
The designee shall make reasonable efforts to ensure compliance with all laws related to the consumption of alcoholic beverages by persons in the party who are under 21 years of age and who are not accompanied by a parent or legal guardian.
The designee shall make reasonable efforts to ensure compliance with all laws prohibiting the providing of alcoholic beverages to persons under 21 years of age by adult members of the party who are 21 years of age or older.
If a person under 21 years of age is accompanied by a parent or legal guardian, then the parent or legal guardian shall make reasonable efforts to ensure that person complies with laws prohibiting the consumption of alcoholic beverages.
A designee or, when present, the parent or legal guardian who fails to act reasonably shall be responsible for any reasonably foreseeable personal injury or property damage that is proximately caused by a violation of laws prohibiting the consumption of alcoholic beverages by a person under 21 years of age when alcoholic beverages are consumed during the provision of transportation services if the designee, parent, or legal guardian knew or reasonably should have known that the person is under 21 years of age and is consuming or has consumed alcoholic beverages during the provision of transportation services.
Nothing in this paragraph limits the right of a designee to seek indemnity from any person, corporation, or other entity other than the charter-party carrier of passengers.
Nothing in this section relieves a passenger of legal responsibility for his or her own conduct.
The designee shall read the following statement to those persons under 21 years of age:
“Consumption of alcoholic beverages by persons under 21 years of age is illegal. It is also illegal for an adult to provide alcoholic beverages to a person under 21 years of age. If you consume alcoholic beverages, this trip will be terminated and all payments for transportation services shall be forfeited and not subject to refund.”
The terms of the statement required to be read pursuant to subparagraph (A) shall be a part of the contract of carriage between the charter-party carrier of passengers and the chartering party.
If, during the course of providing transportation services, any person under 21 years of age is found to be, or to have been, consuming any alcoholic beverage, the designee shall immediately notify the driver and the driver shall terminate the trip. All passengers, including all passengers of a joint carriage if more than one party is participating in the trip, shall be brought back to the point of origin of the trip. All payment for transportation services shall be forfeited and not subject to refund.
Should the designee, or when present, the parent or legal guardian, fail to inform the driver, or if the designee, parent, or legal guardian permits the drinking of alcoholic beverages by persons under 21 years of age to occur in the vehicle, the designee, parent, or legal guardian shall be subject to prosecution for violation of subdivision (a) of Section 25658 of the Business and Professions Code.
If, at the time transportation is prearranged with the charter-party carrier of passengers, the chartering party discloses that alcoholic beverages will be served or transported in the passenger compartment, but that no member of the party is or will be under 21 years of age, each of the following applies:
If any passenger is under 21 years of age, the failure to disclose the age of this passenger is a violation of the contract of carriage, and transportation services shall be terminated, and no refund given, unless all alcoholic beverages are removed and locked in the vehicle trunk or other locked compartment.
If, at the time transportation is prearranged with the charter-party carrier of passengers, the chartering party discloses that a member of the party is under 21 years of age, but that no alcoholic beverages will be served or transported in the passenger compartment, each of the following applies:
If the driver is informed or learns that alcoholic beverages will be served or transported in the passenger compartment and a member of the party is under 21 years of age, the failure by the driver to do any of the following is a misdemeanor:
To commence or continue transport without a designee who is 25 years of age or older present, unless the person who is under 21 years of age is accompanied by a parent or guardian.
To commence transport without obtaining the designee’s signature or initials on the form described in paragraph (4) of subdivision (b).
To commence transport without the designee verifying to the driver that the designee has checked the identifications of all passengers to determine who is under 21 years of age and read the statement specified in paragraph (7) of subdivision (b) to each member of the party who is under 21 years of age.
To not terminate the trip and to return the chartering party to the place of origin if informed by the designee or, if present, a parent or guardian, that a person under 21 years of age is consuming or has consumed alcoholic beverages or by otherwise learning that a person under 21 years of age is consuming or has consumed alcoholic beverages.
If the driver is informed or learns that alcoholic beverages will be served or transported in the passenger compartment and is informed that no member of the party is under 21 years of age, the failure to do any of the following is a misdemeanor:
To fail to take reasonable steps to verify the age of any passenger reasonably believed to be under 21 years of age.
To commence transport if a party member is under 21 years of age, unless all alcoholic beverages are removed and locked in the vehicle trunk or other locked compartment.
To not terminate the trip and to return the chartering party to the place of origin if the driver learns that a person under 21 years of age is consuming or has consumed alcoholic beverages.
If the driver is informed or learns that one or more members of the party are under 21 years of age and is informed that no alcoholic beverages will be served or transported in the passenger compartment, the failure to do any of the following is a misdemeanor.
If the driver reasonably believes that alcoholic beverages were brought into the vehicle, to fail to take reasonable steps to verify that no alcoholic beverages were brought into the vehicle.
To commence or continue transport if the driver learns that alcoholic beverages were brought onto the vehicle, unless all alcoholic beverages are removed and locked in the vehicle trunk or other locked compartment.
A failure by the designee to do any of the following is a misdemeanor:
To check the identifications of all passengers to determine who is under 21 years of age.
To read the statement specified in paragraph (7) of subdivision (b) to each passenger in the party who is under 21 years of age.
To notify the driver of the vehicle if, at any time during the trip, a passenger in the designee’s party who is under 21 years of age is consuming or has consumed alcoholic beverages.
Upon termination of a trip because of the consumption of alcoholic beverages by a person under 21 years of age, to safely return any person under 21 years of age who is a member of the designee’s party to his or her home, to take him or her to a location reasonably believed to be safer than his or her home, or to entrust him or her into the care of his or her parent or legal guardian.
When present, the failure of a parent or guardian to notify the driver when a member of the party who is under 21 years of age and for whom the parent or guardian is responsible is consuming or has consumed alcoholic beverages during the provision of transportation services is guilty of a misdemeanor.
If the commission, after a hearing, finds that a charter-party carrier of passengers or the driver of a charter-party carrier of passengers has violated this section, the commission shall do the following:
For a first violation, the commission shall impose a civil penalty of not more than two thousand dollars ($2,000) upon the carrier, as determined appropriate by the commission.
For a second violation, the commission shall impose a civil penalty of not more than two thousand dollars ($2,000) upon the carrier or may suspend the carrier’s certificate or permit for not more than 30 days, or both, as determined appropriate by the commission.
For a third violation, the commission shall revoke the carrier’s certificate or permit.
The authority granted the commission in subdivision (h) is in addition to any authority the commission has to enforce the requirements of this chapter, and the commission may impose any penalties available pursuant to this chapter for a violation of this section.
Nothing in this section shall change the liability of a party knowingly furnishing the alcoholic beverage to a person who they know or reasonably should know to be under 21 years of age.
Every charter-party carrier of passengers shall furnish the commission annually with a list, prepared under oath, of all vehicles used in transportation for compensation during the preceding year. The list shall include and identify each modified limousine and the terminal location of each modified limousine. The commission shall furnish a copy of this list identifying each modified limousine and its terminal location to the Department of the California Highway Patrol.
The commission shall not issue or continue in effect any permit, certificate, or authority of a charter-party carrier of passengers that has not submitted fees required for inspection pursuant to Section 34500.4 of the Vehicle Code and any associated penalties, if applicable.
Not later than January 1, 2015, the commission shall provide the Department of the California Highway Patrol with a list of each charter-party carrier’s modified limousines and their terminal locations in order for the department to promulgate regulations pursuant to Section 34500.4 of the Vehicle Code.
For purposes of this article, the following terms have the following meanings:
“Contract crew transportation vehicle” means a motor vehicle designed to transport 15 or fewer people, including the driver, that is owned, leased, operated, or maintained by a person contracting with a railroad corporation or its agents, contractors, subcontractors, vendors, subvendors, secondary vendors, or subcarriers, and used primarily to provide railroad crew transportation.
“Crew transportation operator” means the person or entity that operates a contract crew transportation vehicle pursuant to a contract with a railroad corporation or its agents, contractors, subcontractors, vendors, subvendors, secondary vendors, or subcarriers.
“Motor vehicle” has the same meaning as in Section 415 of the Vehicle Code.
A crew transportation operator shall not operate a contract crew transportation vehicle without a valid permit, as determined by the commission.
A crew transportation operator shall provide the commission with proof of insurance coverage that meets all of the following:
Provides at least five million dollars ($5,000,000) in combined single limit coverage for bodily injury and property damage liability coverage.
Provides at least one million dollars ($1,000,000) in uninsured and underinsured motorist coverage.
Names the crew transportation operator as a named insured or an additional insured.
This section does not apply to either of the following:
If the driver of any charter-party carrier of passengers for hire operating under a valid certificate or permit, or any officer, director, agent, or employee of a charter-party carrier of passengers operating vehicles used in the transportation of passengers for hire under such a certificate or permit, is convicted of a violation of Section 23225 of the Vehicle Code, the commission, after a hearing, shall do the following:
For a first offense, the commission may impose a civil penalty of not more than two thousand dollars ($2,000) upon the carrier, as determined appropriate by the commission.
For a second offense, the commission may impose a civil penalty of not more than two thousand dollars ($2,000) upon the carrier or suspend the carrier’s certificate or permit for not more than 30 days, or both, as determined appropriate by the commission.
For a third offense, the commission shall revoke the carrier’s certificate or permit.
A charter-party carrier of passengers, except those engaged in the provision of a hired driver service when a rented motor vehicle is being operated by the hired driver, shall not operate any motor vehicle on any public highway unless there is displayed on the vehicle a distinctive identifying symbol in the form prescribed by the commission, showing the classification to which the carrier belongs. Such an identifying symbol shall not be displayed on any vehicle until a permit or certificate of public convenience and necessity under this chapter has been issued to the carrier. The identifying symbol displayed by charter-party carriers subject to the Interstate Commerce Commission shall serve in lieu of the display requirements of this section.
A charter-party carrier shall not operate a modified limousine, as defined in Section 5361, unless the modified limousine is equipped with emergency exits at the rear of the vehicle as required pursuant to Article 3.4 (commencing with Section 27375) of Chapter 5 of Division 12 of the Vehicle Code. The commission shall adopt rules to implement this section.
Every charter-party carrier of passengers, including a charter-party carrier that operates a limousine, shall include the number of its permit or certificate in every written or oral advertisement of the services it offers.
For the purposes of this subdivision, “advertisement” includes, but is not limited to, the issuance of any card, sign, or device to any person, the causing, permitting, or allowing the placement of any sign or marking on or in any building or structure, or in any media form, including newspaper, magazine, radiowave, satellite signal, or any electronic transmission, or in any directory soliciting charter-party transportation services subject to this chapter.
No charter-party carrier of passengers shall advertise its services, or in any manner represent its services, as being a taxicab or taxi service. For the purposes of this section, “advertise” includes any business card, stationery, brochure, flyer, circular, newsletter, fax form, printed or published paid advertisement in any media form, or telephone book listing.
It is unlawful for the owner of a charter-party carrier of passengers to permit the operation of a vehicle upon a public highway for compensation without (1) having obtained from the commission a certificate or permit pursuant to this chapter, (2) having complied with the vehicle identification requirements of Section 5385, and (3) having complied with the accident liability protection requirements of Section 5391.
A person who drives a bus for a charter-party carrier without having a current and valid driver’s license of the proper class, a passenger vehicle endorsement, or the required certificate shall be suspended from driving a bus of any kind, including, but not limited to, a bus, schoolbus, school pupil activity bus, or transit bus, with passengers for a period of five years pursuant to Section 13369 of the Vehicle Code.
A charter-party carrier shall have its authority to operate as a charter-party carrier permanently revoked by the commission or be permanently barred from receiving a permit or certificate from the commission if it commits any of the following acts:
Operates a bus without having been issued a permit or certificate from the commission.
Operates a bus with a permit that was suspended by the commission pursuant to Section 5378.5.
Commits three or more liability insurance violations within a two-year period for which it has been cited.
Operates a bus with a permit that was suspended by the commission during a period that the charter-party carrier’s liability insurance lapsed for which it has been cited.
Knowingly employs a busdriver who does not have a current and valid driver’s license of the proper class, a passenger vehicle endorsement, or the required certificate to drive a bus.
Has one or more buses improperly registered with the Department of Motor Vehicles.
The commission shall not issue a new permit or certificate to operate as a charter-party carrier if any officer, director, or owner of that charter-party carrier was an officer, director, or owner of a charter-party carrier that had its authority to operate as a charter-party carrier permanently revoked by the commission or that was permanently barred from receiving a permit or certificate from the commission pursuant to this subdivision.
A peace officer, as designated pursuant to Chapter 4.5 (commencing with Section 830) of Title 3 of Part 2 of the Penal Code, may impound a bus or limousine of a charter-party carrier of passengers for 30 days pursuant to Section 14602.9 of the Vehicle Code if the peace officer determines that any of the following violations occurred while the driver was operating the bus or limousine of the charter-party carrier:
The driver was operating the bus or limousine of a charter-party carrier of passengers without having a current and valid driver’s license of the proper class, a passenger vehicle endorsement, or the required certificate.
This section does not authorize the impoundment of privately owned personal vehicles that are not common carriers nor the impoundment of vehicles used in transportation for compensation by charter-party carriers of passengers that are not required to carry individual permits.
A charter-party carrier described in subdivision (c) of Section 5387, that has received a notice of refusal or revocation of its permit to operate, may submit to the commission, within 15 days after the mailing of the notice, a written request for a hearing. The charter-party carrier shall furnish a copy of the request to the Department of the California Highway Patrol at the same time that it makes its request for a hearing to the commission. Failure to request a hearing, in writing, within the 15-day period is a waiver of the right to a hearing.
Upon receipt by the commission of the hearing request, the commission shall hold a hearing within a reasonable time, not to exceed 21 days, and may appoint a hearing officer to conduct the hearing. At the hearing, the burden of proof is on the charter-party carrier to prove that it was not in violation of subdivision (c) of Section 5387.
The refusal to, or revocation of, the permit to operate, may only be rescinded by the hearing officer if the charter-party carrier proves that it was not in violation of subdivision (c) of Section 5387, and that the basis of the refusal or revocation resulted from a factual error.
When the commission or an employee of the commission determines that any person or corporation is holding itself out as a charter-party carrier of passengers without a certificate or permit to so operate, the carrier shall pay the commission the fee established pursuant to Section 421 for the period during which it operated without authority, up to a maximum of three years, which fee shall be deposited in the Public Utilities Commission Transportation Reimbursement Account.
The commission, each commissioner, and each officer and person employed by the commission may, at any time have access to the land, buildings, or equipment of a charter-party carrier of passengers used in connection with the operation of its business and may inspect the accounts, books, papers, and documents of the carrier. Any inspection by the commission may include photocopying or the electrostatic or photostatic reproduction of documents either at the premises of the carrier or the offices of the commission, at the option of the carrier. The commission shall reimburse the carrier for any copying or reproduction expenses incurred by it at the direction of the commission.
Subdivision (a) also applies to access to property and inspections of the accounts, books, papers, and documents of any business which is a subsidiary or affiliate of, or a corporation which holds a controlling interest in, a charter-party carrier of passengers with respect to any transaction between the carrier and the subsidiary, affiliate, or holding corporation.
Subdivisions (a) and (b) also apply to any person or corporation engaged in the transportation of persons by motor vehicle for compensation, which the commission, or an officer or person employed by the commission, determines is holding itself out as a charter-party carrier of passengers.
ARTICLE 4. Accident Liability Protection [5391. - 5395.]
The commission shall, in granting permits or a certificate pursuant to this chapter, require the charter-party carrier of passengers to procure, and to continue in effect during the life of the permit or certificate, adequate protection against liability imposed by law upon the charter-party carrier of passengers for the payment of damages for personal bodily injuries, including death resulting therefrom, protection against a total liability of the charter-party carrier of passengers on account of bodily injuries to, or death of, more than one person as a result of any one accident, and protection against damage or destruction of property. The minimum requirements for such assurances of protection against liability shall not be less than the requirements which are applicable to operations conducted under certificates of public convenience and necessity issued pursuant to the provisions of Article 2 (commencing with Section 1031), Chapter 5, Part 1, Division 1, of this code, and the rules and regulations prescribed pursuant thereto shall apply to charter-party carriers of passengers.
Notwithstanding Section 5391, in granting certificates to the holders of class C certificates, the commission shall require that those carriers procure and continue in effect adequate protection against liability imposed by law upon the carrier for the payment of damages for personal bodily injuries, including death resulting therefrom; protection against a total liability of the carrier of passengers on account of bodily injuries to, or death of, more than one person as a result of any one accident; and protection against damage or destruction of property. The requirement of that assurance of protection against liability shall be seven hundred fifty thousand dollars ($750,000) per accident.
The commission shall commence a rulemaking proceeding to develop uniform operating standards applicable to charter-party carriers of passengers. The rulemaking proceeding shall include, but shall not be limited to, a consideration of all of the following issues:
Whether current insurance limits provide sufficient liability coverage for charter-party carriers to operate to any point in this state.
Whether the commission’s requirements concerning the maintenance of records is sufficient to permit the safe operation of charter-party carriers to any point in this state.
Whether the commission’s current procedures for the issuance of operating authority are creating unnecessary congestion upon the roads of this state.
A policy of insurance, issued by a company licensed to write insurance in this state, or by nonadmitted insurers subject to Section 1763 of the Insurance Code, if the policies meet the rules promulgated therefor by the commission.
A bond of a surety company licensed to write surety bonds in the state.
Evidence of the qualification of the charter-party carrier of passengers as a self-insurer as may be authorized by the commission.
This section applies only to the driver supplied by a charter-party carrier of passengers engaged in the provision of a hired driver service when a rented motor vehicle is being operated by the hired driver. The requirements of this section do not apply to the separately rented vehicle.
Notwithstanding any other provision of law, any charter-party carrier of passengers that contracts to provide a vanpool vehicle, as described in paragraph (1) of subdivision (c) of Section 17149 of the Revenue and Taxation Code, to an employer or a group of employees for the purpose of operating that vehicle for transportation to and from work shall maintain protection against liability with respect to that vehicle in the same form and amount as described in Section 5391.2.
No person, firm, or corporation holding a valid permit issued by the commission pursuant to this chapter shall be required by any agency of local government to provide insurance in a manner different from that required by the commission.
With the consent of the commission a copy of an insurance policy, certified by the company issuing it to be a true copy of the original policy, or a photostatic copy thereof, or an abstract of the provisions of the policy, or a certificate of insurance issued by the company issuing the policy, may be filed with the commission in lieu of the original or a duplicate or counterpart of the policy.
A school, school district, or the state is not liable for transportation services provided by an operator of a charter-party carrier operating a motor vehicle as specified in subdivision (k) of Section 545 of the Vehicle Code for which the school or school district has not contracted, arranged, or otherwise provided.
ARTICLE 5. Basis of Charges [5401. - 5402.]
Charges for the transportation to be offered or afforded by a charter-party carrier of passengers shall be computed and assessed on a vehicle mileage or time of use basis, or on a combination thereof. These charges may vary in accordance with the passenger capacity of the vehicle, or the size of the group to be transported. However, no charter-party carrier of passengers shall, directly or through an agent or otherwise, nor shall any broker, contract, agree, or arrange to charge, or demand or receive compensation, for the transportation offered or afforded that shall be computed, charged, or assessed on an individual-fare basis, except schoolbus contractors who are compensated by parents of children attending public, private, or parochial schools and except operators of round-trip sightseeing tour services conducted under a certificate subject to Section 5371.1, or a permit issued pursuant to subdivision (c) of Section 5384.
No person, partnership, corporation, or organization shall sell transportation by a passenger stage on an individual-fare basis for a sightseeing trip in California on a route for which a passenger stage corporation has obtained a certificate of convenience and necessity if the seller intends to charter or charters the passenger stage in California at a rate per passenger which is less than the individual fare for which the transportation is sold.
ARTICLE 6. Fines and Penalties [5411. - 5420.]
Every charter-party carrier of passengers and every officer, director, agent, or employee of any charter-party carrier of passengers who violates or who fails to comply with, or who procures, aids, or abets any violation by any charter-party carrier of passengers of any provision of this chapter, or who fails to obey, observe, or comply with any order, decision, rule, regulation, direction, demand, or requirement of the commission, or of any operating permit or certificate issued to any charter-party carrier of passengers, or who procures, aids, or abets any charter-party carrier of passengers in its failure to obey, observe, or comply with any such order, decision, rule, regulation, direction, demand, requirement, or operating permit or certificate, is guilty of a misdemeanor and is punishable by a fine of not less than one thousand dollars ($1,000) and not more than five thousand dollars ($5,000) or by imprisonment in a county jail for not more than three months, or by both that fine and imprisonment.
Every charter-party carrier of passengers, and every officer, director, agent, or employee of a charter-party carrier of passengers, who displays on any vehicle any identifying symbol other than one prescribed by the commission pursuant to Section 5385, or who fails to remove an identifying symbol when required by the commission, is guilty of a misdemeanor and is punishable by a fine of not more than two thousand five hundred dollars ($2,500), by imprisonment in the county jail for not more than one year, or by both.
Whenever a peace officer, as defined in Chapter 4.5 (commencing with Section 830) of Title 3 of Part 2 of the Penal Code, arrests a person for operation of a charter-party carrier of passengers without a valid certificate or permit, the peace officer may impound and retain possession of the vehicle.
Whenever a peace officer, as defined in Chapter 4.5 (commencing with Section 830) of Title 3 of Part 2 of the Penal Code, arrests a person for operating a charter-party carrier of passengers as a taxicab in violation of an ordinance or resolution of a city, county, or city and county, the peace officer may impound and retain possession of the vehicle.
If the vehicle is seized from a person who is not the owner of the vehicle, the impounding authority shall immediately give notice to the owner by first-class mail.
The vehicle shall immediately be returned to the owner if the infraction or violation is not prosecuted or is dismissed, the owner is found not guilty of the offense, or it is determined that the vehicle was used in violation of Section 5411 without the knowledge and consent of the owner. The vehicle shall be returned to the owner upon payment of any fine ordered by the court. If the vehicle is seized due to a violation of a person other than the owner of the vehicle, the vehicle shall be returned to the owner after all impoundment fees are paid. After the expiration of six weeks from the final disposition of the criminal case, unless the owner is in the process of making payments to the court, the impounding authority may deal with the vehicle as lost or abandoned property under Section 1411 of the Penal Code.
At any time, a person may make a motion in superior court for the immediate return of the vehicle on the ground that there was no probable cause to seize it or that there is some other good cause, as determined by the court, for the return of the vehicle. A proceeding under this section is a limited civil case.
No peace officer, however, may impound any vehicle owned or operated by a nonprofit organization exempt from taxation pursuant to Section 501(c)(3) of the Internal Revenue Code which serves youth or senior citizens and provides transportation incidental to its programs or services or a rented motor vehicle that is being operated by a hired driver of a charter-party carrier of passengers that is providing hired driver service.
Every charter party carrier of passengers and every officer, director, agent, or employee of a charter party carrier of passengers who knowingly and willfully makes a false statement of the carrier’s gross operating revenues in order to underpay the commission’s reimbursement fees is guilty of a misdemeanor.
Every corporation or person other than a charter-party carrier of passengers, who knowingly and willfully, either individually, or acting as an officer, agent, or employee of a corporation, copartnership, or any other person other than a charter-party carrier of passengers, violates any provision of this chapter or fails to observe, obey, or comply with any order, decision, rule, regulation, direction, demand, or requirement of the commission, or who procures, aids, or abets any charter-party carrier of passengers in its violation of this chapter, or in its failure to obey, observe, or comply with any such order, decision, rule, regulation, direction, demand, or requirement, is guilty of a misdemeanor, and is punishable by a fine of not more than two thousand dollars ($2,000) or by imprisonment in the county jail for not more than three months, or both.
When a person is convicted of the offense of operating a taxicab without a valid certificate or permit, in addition to any other penalties provided by law, if the court determines the operator has the ability to pay, the court shall impose a mandatory fine not exceeding two thousand five hundred dollars ($2,500) for a first conviction or five thousand dollars ($5,000) for a subsequent conviction.
When a person is convicted of the offense of operating a charter-party carrier of passengers without a valid certificate or permit, in addition to any other penalties provided by law, if the court determines the operator has the ability to pay, the court shall impose a mandatory fine not exceeding ten thousand dollars ($10,000) for a first conviction or twenty-five thousand dollars ($25,000) for a subsequent conviction.
As used in this section, “taxicab” means a passenger vehicle designed for carrying not more than eight persons, excluding the driver, and used to carry passengers for hire. “Taxicab” shall not include a charter-party carrier of passengers within the meaning of this chapter.
Every officer or person employed by the commission who, except as authorized by the commission or a court, discloses any fact or information from an inspection of the accounts, books, papers, or documents of a charter-party carrier of passengers is guilty of a misdemeanor and is punishable by a fine of not more than one thousand dollars ($1,000), by imprisonment in the county jail for not more than three months, or by both.
Every charter-party carrier of passengers and every officer, director, agent, or employee of any charter-party carrier of passengers who violates or who fails to comply with, or who procures, aids, or abets, any violation by any charter-party carrier of passengers of any provision of this chapter, or who fails to obey, observe, or comply with any order, decision, rule, regulation, direction, demand, or requirement of the commission, or of any operating permit or certificate issued to any charter-party carrier of passengers, or who procures, aids, or abets any charter-party carrier of passengers in its failure to obey, observe, or comply with any such order, decision, rule, regulation, direction, demand, requirement, or operating permit, or certificate, is subject to a penalty of not more than two thousand dollars ($2,000) for each offense.
Whenever the commission, after hearing, finds that any person or corporation is operating as a charter-party carrier of passengers, including a charter-party carrier operating a limousine, without a valid certificate or permit, or fails to include in any written or oral advertisement the number of the certificate or permit required by Section 5386, the commission may impose a fine of not more than seven thousand five hundred dollars ($7,500) for each violation. The commission may assess the person or corporation an amount sufficient to cover the reasonable expense of investigation incurred by the commission. The commission may assess interest on any fine or assessment imposed, to commence on the day the payment of the fine or assessment becomes delinquent. All fines, assessments, and interest collected shall be deposited at least once each month in the General Fund.
Whenever the commission, after hearing, finds that any person or corporation is operating a charter-party carrier of passengers as a taxicab without a valid certificate or permit in violation of an ordinance or resolution of a city, county, or city and county, the commission may impose a fine of not more than five thousand dollars ($5,000) for each violation. The commission may assess the person or corporation an amount sufficient to cover the reasonable expense of investigation incurred by the commission. The commission may assess interest on any fine or assessment imposed, to commence on the day the payment of the fine or assessment becomes delinquent. All fines, assessments, and interest collected shall be deposited at least once each month in the General Fund.
Every corporation or person other than a charter-party carrier of passengers who knowingly and willfully, either individually, or acting as an officer, agent, or employee of a corporation, copartnership, or any other person other than a charter-party carrier of passengers, violates any provision of this chapter or fails to observe, obey, or comply with any order, decision, rule, regulation, direction, demand, or requirement of the commission, or who procures, aids, or abets any charter-party carrier of passengers in its violation of this chapter, or in its failure to obey, observe, or comply with any such order, decision, rule, regulation, direction, demand, or requirement, is subject to a penalty of not more than two thousand dollars ($2,000) for each offense.
Every corporation or person who knowingly and willfully issues, publishes, or affixes, or causes or permits the issuance, publishing, or affixing, of any oral or written advertisement, broadcast, or other holding out to the public, or any portion thereof, that the corporation or person is in operation as a charter-party carrier of passengers without having a valid certificate or permit issued under this chapter is guilty of a misdemeanor punishable, if an individual, by a fine of not more than one thousand dollars ($1,000) or by imprisonment in the county jail for not more than six months, or by both, or, if a corporation, by a fine of not more than five thousand dollars ($5,000).
Every violation of the provisions of this chapter or of any order, decision, decree, rule, direction, demand, or requirement of the commission by any corporation or person is a separate and distinct offense, and in case of a continuing violation each day’s continuance thereof is a separate and distinct offense.
When the executive director of the commission determines that any charter-party carrier of passengers, or any officer, director, or agent of any charter-party carrier of passengers, has engaged in, is engaged in, or is about to engage in, any acts or practices in violation of this chapter, or any order, decision, rule, regulation, direction, demand, or requirement issued under this chapter, the executive director may make application to the superior court for an order enjoining those acts or practices or for an order directing compliance. The court may grant a permanent or temporary injunction, restraining order, or other order, including, but not limited to, an order allowing vehicles used for subsequent operations subject to the order to be impounded at the carrier’s expense and subject to release only by subsequent court order following a petition to the court by the defendant or owner of the vehicle, upon a showing by the executive director that a person or corporation has engaged in or is about to engage in these acts or practices. The commission may contract with the Department of the California Highway Patrol or a sheriff to assist in enforcement of an order for vehicle impound. Any costs incurred by the commission for that assistance are not assignable to the carrier as an expense of impound.
All penalties accruing under this chapter are cumulative, and a suit for the recovery of one penalty does not bar or affect the recovery of any other penalty or forfeiture or bar any criminal prosecution against any person or corporation, or any officer, director, agent of employee thereof, or any other corporation or person, or bar the exercise by the commission of its power to punish for contempt.
Actions to recover penalties under this chapter shall be brought in the name of the people of the State of California, in the superior court of the county, or city and county, in which the cause or some part thereof arose, or in which the corporation complained of, if any, has its principal place of business, or in which the person, if any, complained of, resides. The action shall be commenced and prosecuted to final judgment by the attorney of the commission.
This section shall become operative on January 1, 2014.
The commission shall ensure that this chapter is enforced and obeyed, and that violations thereof are promptly prosecuted and that penalty moneys due to the state are recovered and collected, and to this end it may sue in the name of the people of the State of California. Upon the request of the commission, the Attorney General or the district attorney of the proper county or city and county may aid in any investigation, hearing, or trial under this chapter. The Attorney General, a district attorney of the proper county or city and county, or a city attorney may institute and prosecute actions or proceedings for the violation of any law committed in connection with, or arising from, a transaction involving a charter-party carrier of passengers.
For purposes of this section, “peace officer” means a person designated as a peace officer pursuant to Chapter 4.5 (commencing with Section 830) of Title 3 of Part 2 of the Penal Code.
A peace officer may enforce and assist in the enforcement of Sections 5411 and 5412 resulting from a violation of Section 5371, 5379, 5385, 5385.7, or 5387, or more than one of those sections. A peace officer may additionally enforce and assist in the enforcement of Sections 5411.3 and 5414.5. In any case in which an arrest authorized by this subdivision is made for an offense declared to be a misdemeanor, and the person arrested does not demand to be taken before a magistrate, the arresting peace officer may, instead of taking such person before a magistrate, follow the procedure prescribed by Chapter 5C (commencing with Section 853.5) of Title 3 of Part 2 of the Penal Code. The provisions of that chapter shall thereafter apply with reference to any proceeding based upon the issuance of a citation pursuant to this authority.
The commission shall coordinate enforcement of this section with those peace officers likely to be involved in enforcing this section, including undertaking both of the following:
Establishing lines of communication so that the commission is notified if an action is commenced to enforce the requirements of those sections specified in subdivision (c), so that the commission may take appropriate action to enforce the fine and penalty provisions of this article.
The Attorney General, a district attorney of the proper county or city and county, or a city attorney may institute and prosecute actions or proceedings for the violation of any law committed in connection with, or arising from, a transaction involving the transportation of passengers by a charter-party carrier of passengers.
In any such action, all penalties incurred up to the time of the commencement of the action may be sued for and recovered. In all such actions, the procedure and rules of evidence shall be the same as in ordinary civil actions.
All penalties recovered by the State in any action pursuant to this chapter, together with the costs thereof, shall be paid into the State Treasury to the credit of the General Fund. Any such action may be compromised or discontinued on application of the commission upon such terms as the court approves and orders.
Whenever a written notice to appear has been mailed to the owner of a charter-party carrier of passengers motor vehicle, an exact and legible duplicate copy of the notice, when filed with the magistrate in lieu of a verified complaint, is a complaint to which the defendant may plead guilty.
If, however, the defendant fails to appear, does not deposit bail, or pleads other than guilty to the offense charged, a complaint shall be filed which conforms to Chapter 2 (commencing with Section 948) of Title 5 of Part 2 of the Penal Code and which shall be deemed to be an original complaint, and thereafter the proceeding shall be held as provided by law, except that the defendant may, by an agreement in writing, subscribed by the defendant and filed with the court, waive the filing of a verified complaint and elect that the prosecution may proceed upon a written notice to appear.
ARTICLE 7. Transportation Network Companies [5430. - 5450.]
Notwithstanding any other provision of this chapter, this article shall apply to transportation network companies.
For purposes of this article, the following terms have the following meanings:
“Participating driver” or “driver” means any person who uses a vehicle in connection with a transportation network company’s online-enabled application or platform to connect with passengers.
“Personal vehicle” means a vehicle that is used by a participating driver to provide prearranged transportation services for compensation that meets all of the following requirements:
Has a passenger capacity of eight persons or less, including the driver.
Is owned, leased, rented for a term that does not exceed 30 days, or otherwise authorized for use by the participating driver.
Meets all inspection and other safety requirements imposed by the commission.
Is not a taxicab or limousine.
“Transportation network company” means an organization, including, but not limited to, a corporation, limited liability company, partnership, sole proprietor, or any other entity, operating in California that provides prearranged transportation services for compensation using an online-enabled application or platform to connect passengers with drivers using a personal vehicle.
“Transportation network company insurance” means a liability insurance policy that specifically covers liabilities arising from a driver’s use of a vehicle in connection with a transportation network company’s online-enabled application or platform.
“Zero-emission vehicle” has the same meaning as in Section 44258 of the Health and Safety Code.
In addition to the definitions provided in Section 5431, the following terms have the following meanings:
“Access provider” means an organization or entity that directly provides, or contracts with a separate organization or entity to provide, on-demand transportation to meet the needs of persons with disabilities.
“Wheelchair accessible vehicle” or “WAV” means a vehicle equipped with a ramp or lift capable of transporting nonfolding motorized wheelchairs, mobility scooters, or other mobility devices.
A transportation network company shall disclose in writing to participating drivers, as part of its agreement with those drivers, the insurance coverage and limits of liability that the transportation network company provides while the driver uses a vehicle in connection with a transportation network company’s online-enabled application or platform, and shall advise a participating driver in writing that the driver’s personal automobile insurance policy will not provide coverage because the driver uses a vehicle in connection with a transportation network company’s online-enabled application or platform.
A transportation network company shall also disclose in writing to participating drivers, as part of its agreement with those drivers, that the driver’s personal automobile insurance policy will not provide collision or comprehensive coverage for damage to the vehicle used by the driver from the moment the driver logs on to the transportation network company’s online-enabled application or platform to the moment the driver logs off the transportation network company’s online-enabled application or platform.
This section shall become operative on July 1, 2015.
A transportation network company and any participating driver shall maintain transportation network company insurance as provided in this section.
The following requirements shall apply to transportation network company insurance from the moment a participating driver accepts a ride request on the transportation network company’s online-enabled application or platform until the driver completes the transaction on the online-enabled application or platform or until the ride is complete, whichever is later:
Transportation network company insurance shall be primary and in the amount of one million dollars ($1,000,000) for death, personal injury, and property damage. The requirements for the coverage required by this paragraph may be satisfied by any of the following:
Transportation network company insurance maintained by a participating driver.
Transportation network company insurance maintained by a transportation network company.
Any combination of subparagraphs (A) and (B).
A transportation network company shall provide uninsured motorist coverage and underinsured motorist coverage in the amount of sixty thousand dollars ($60,000) per person and three hundred thousand dollars ($300,000) per incident from the moment a passenger enters the vehicle of a participating driver until the passenger exits the vehicle. The policy provided in this paragraph shall be primary over any other applicable uninsured or underinsured motorist coverage and shall be solely the obligation of the transportation network company.
The insurer, in the case of insurance coverage provided under this subdivision, shall have the duty to defend and indemnify the insured.
A transportation network company may meet its obligations under paragraph (1) through a policy obtained by a participating driver pursuant to subparagraph (A) or (C) of paragraph (1) only if the transportation network company verifies that the policy is maintained by the driver and is specifically written to cover the driver’s use of a vehicle in connection with a transportation network company’s online-enabled application or platform.
The following requirements shall apply to transportation network company insurance from the moment a participating driver logs on to the transportation network company’s online-enabled application or platform until the driver accepts a request to transport a passenger, and from the moment the driver completes the transaction on the online-enabled application or platform or the ride is complete, whichever is later, until the driver either accepts another ride request on the online-enabled application or platform or logs off the online-enabled application or platform:
Coverage under a transportation network company insurance policy shall not be dependent on a personal automobile insurance policy first denying a claim nor shall a personal automobile insurance policy be required to first deny a claim.
In every instance where transportation network company insurance maintained by a participating driver to fulfill the insurance obligations of this section has lapsed or ceased to exist, the transportation network company shall provide the coverage required by this section beginning with the first dollar of a claim.
This article does not limit the liability of a transportation network company arising out of an automobile accident involving a participating driver in any action for damages against a transportation network company for an amount above the required insurance coverage.
Nothing in this section shall be construed to require a private passenger automobile insurance policy to provide primary or excess coverage during the period of time from the moment a participating driver in a transportation network company logs on to the transportation network company’s online-enabled application or platform until the driver logs off the online-enabled application or platform or the passenger exits the vehicle, whichever is later.
During the period of time from the moment a participating driver in a transportation network company logs on to the transportation network company’s online-enabled application or platform until the driver logs off the online-enabled application or platform or the passenger exits the vehicle, whichever is later, all of the following shall apply:
The participating driver’s or the vehicle owner’s personal automobile insurance policy shall not provide any coverage to the participating driver, vehicle owner, or any third party, unless the policy expressly provides for that coverage during the period of time to which this subdivision is applicable, with or without a separate charge, or the policy contains an amendment or endorsement to provide that coverage, for which a separately stated premium is charged.
The participating driver’s or the vehicle owner’s personal automobile insurance policy shall not have the duty to defend or indemnify for the driver’s activities in connection with the transportation network company, unless the policy expressly provides otherwise for the period of time to which this subdivision is applicable, with or without a separate charge, or the policy contains an amendment or endorsement to provide that coverage, for which a separately stated premium is charged.
Notwithstanding any other law, a personal automobile insurer may, at its discretion, offer an automobile liability insurance policy, or an amendment or endorsement to an existing policy, that covers a private passenger vehicle, station wagon type vehicle, sport utility vehicle, or similar type of vehicle with a passenger capacity of eight persons or less, including the driver, while used in connection with a transportation network company’s online-enabled application or platform only if the policy expressly provides for the coverage during the time period specified in subdivision (b), with or without a separate charge, or the policy contains an amendment or an endorsement to provide that coverage, for which a separately stated premium may be charged.
This section shall become operative on July 1, 2015.
In a claims coverage investigation, a transportation network company or its insurer shall cooperate with insurers that are involved in the claims coverage investigation to facilitate the exchange of information, including the provision of dates and times at which an accident occurred that involved a participating driver and the precise times that the participating driver logged on and off the transportation network company’s online-enabled application or platform.
The commission shall provide the following information in its annual report submitted on or before February 1, 2026, pursuant to Section 910:
The average annual number of automobile accidents involving a participating driver using a personal vehicle reported to the commission for the years 2022 to 2024, inclusive, by transportation network companies.
The average annual percentage of those automobile accidents reported to the commission resulting in uninsured motorist or underinsured motorist claims, or both, for the years 2022 to 2024, inclusive.
The average annual percentage of those automobile accidents reported to the commission resulting in uninsured motorist or underinsured motorist claims, or both, over $100,000 for the years 2022 to 2024, inclusive.
In the annual report submitted on or before February 1, 2027, pursuant to Section 910, the commission shall specify the average transportation network company rider fare, excluding tips, tolls, and taxes, paid during the following time periods:
July 1, 2025, to December 31, 2025, inclusive.
January 1, 2026, to June 30, 2026, inclusive.
July 1, 2026, to December 31, 2026, inclusive.
The information required pursuant to paragraph (1) shall be published by the commission as an aggregate number across all transportation network companies for each time period as reported by transportation network companies.
The commission shall not provide the information described in subdivisions (a) and (b) separately for each transportation network company, and nothing in subdivisions (a) and (b) shall affect the confidentiality of data submitted to the commission by transportation network companies.
Pursuant to Section 10231.5 of the Government Code, this section is inoperative on February 1, 2031, and, as of January 1, 2032, is repealed.
A transportation network company shall not disclose to a third party any personally identifiable information of a transportation network company passenger unless one of the following applies:
The customer knowingly consents.
Pursuant to a legal obligation.
The disclosure is to the commission in order to investigate a complaint filed with the commission against a transportation network company or a participating driver and the commission treats the information under confidentiality protections.
It is the intent of the Legislature that the Department of Insurance expedite review of any application for approval of transportation network company insurance products, and that these products become available for purchase on or before July 1, 2015.
The Legislature makes the following findings and declarations:
The commission has initiated regulation of transportation network companies as a new category of charter-party carriers and continues to develop appropriate regulations for this new service.
Given the rapidly evolving transportation network company service, it is the intent of the Legislature to continue ongoing oversight of the commission’s regulation of these services in order to enact legislation to adjust commission authority and impose specific requirements or prohibitions as deemed necessary as these services evolve.
It is the intent of the Legislature that the commission initiate regulation of charter-party carriers in accordance with Section 5440.5 to ensure that transportation network company services do not discriminate against persons with disabilities, including those who use nonfolding mobility devices.
Technology application-based ride hailing services, such as those services provided by transportation network companies (TNC), have impacted the lives of many people by reducing transportation barriers that limited access to jobs, health care, and society. However, more can be done to enable increased access to on-demand transportation services for people with disabilities, especially for persons using nonfolding motorized wheelchairs.
The availability of transportation services, especially on-demand transportation service, can improve economic competitiveness and quality of life. Many individuals fulfill their transportation needs through vehicle ownership, public transit, carpooling, or walking and biking. However, transportation network companies or other application-based ride hailing services enable alternative, on-demand access to transportation.
There exists a lack of wheelchair accessible vehicles (WAVs) available via TNC online-enabled applications or platforms throughout California. In comparison to standard vehicles available via TNC technology applications, WAVs have higher purchase prices, higher operating and maintenance costs, higher fuel costs, and higher liability insurance, and require additional time to serve riders who use nonfolding motorized wheelchairs.
It is the intent of the Legislature that California be a national leader in the deployment and adoption of on-demand transportation options for persons with disabilities.
It is the policy of the state to encourage collaboration among stakeholders and to promote partnerships to harness the expertise and strengths of all to serve the public interest.
The Legislature further finds that adoption of services in communities that were previously underserved may take time, and requires robust dialogue, educational outreach, and partnerships to build trust in the new services.
It is the intent of the Legislature that wheelchair users who need WAVs have prompt access to TNC services, and for the commission to facilitate greater adoption of wheelchair accessible vehicles on transportation network companies’ online-enabled applications or platforms.
As part of the regulation of transportation network companies (TNCs) referenced in subdivision (a) of Section 5440, the commission shall do all of the following:
In a new or existing proceeding, establish a program relating to accessibility for persons with disabilities, including wheelchair users who need a wheelchair-accessible vehicle (WAV). This program shall include, but is not limited to, all of the following:
By January 1, 2019, the commission shall begin conducting workshops with stakeholders, including California cities and counties, disability rights organizations, persons with disabilities, transportation and transit agencies, social service transportation providers, paratransit coordinating councils, and transportation network companies, in order to determine community WAV demand and WAV supply and to develop and provide recommendations regarding the establishment of geographic areas, criteria for Access Fund expenditures, and educational outreach objectives for programs for on-demand services and partnerships consistent with the requirements of this section. The workshops may also examine topics including, but not limited to, vehicle specifications, subsidies for wheelchair pickups, maintenance and fuel costs, designated pickup locations for drivers in locations where door-to-door service is not feasible, standards for trip requests, response times, and rider initiated cancellation, limiting of stranded users, integration of service into city and county transportation plans, or any necessary training or additional incentives for WAV drivers that results in a measurable impact on service availability, efficiency, and efficacy. The commission shall conduct a minimum of five workshops throughout the state.
The commission shall require each TNC, by July 1, 2019, to pay on a quarterly basis to the commission an amount equivalent to, at minimum, five cents ($0.05) for each TNC trip completed using the transportation network company’s online-enabled application or platform that originates in one of the geographic areas selected pursuant to subparagraph (D), except if the TNC meets the requirements of an exemption established by the commission pursuant to subparagraph (G). The commission may adjust the fee in each geographic area selected pursuant to subparagraph (D) to different levels based on the cost of providing adequate WAV service within the geographic area.
Each TNC shall charge its customers on each TNC trip completed the full amount of the per-trip fee established pursuant to this subparagraph, and remit the total amount of those fees charged to the commission each quarter. The commission shall authorize a TNC to offset against the amounts due pursuant to this subparagraph for a particular quarter the amounts spent by the TNC during that quarter to improve WAV service on its online-enabled application or platform for each geographic area and thereby reduce the amount required to be remitted to the commission. In order to offset amounts due pursuant to this subparagraph in a geographic area, the commission shall require a TNC, at a minimum, to demonstrate, in the geographic area, the presence and availability of drivers with WAVs on its online-enabled application or platform, improved level of service, including reasonable response times, due to those investments for WAV service compared to the previous quarter, efforts undertaken to publicize and promote available WAV services to disability communities, and a full accounting of funds expended.
The commission shall create the TNC Access for All Fund (Access Fund) and deposit moneys collected pursuant to subparagraph (B) in the Access Fund. The commission shall distribute funds in the Access Fund on a competitive basis to access providers that establish on-demand transportation programs or partnerships to meet the needs of persons with disabilities, including wheelchair users who need a WAV, in the geographic areas selected pursuant to subparagraph (D).
The commission shall select geographic areas, which shall be based on the demand for WAVs within the area and selected according to outcomes of workshops in subparagraph (A), for inclusion in the on-demand transportation programs or partnerships funded pursuant to subparagraph (C). The commission shall allocate moneys in the Access Fund for use in each geographic area in a manner that is proportional to the percent of the Access Fund fees originating in that geographic area.
The commission shall request access providers to submit applications to receive funds pursuant to subparagraph (C) by April 1, 2020. The commission may accept applications for new on-demand transportation programs or partnerships any time after April 1, 2020. From the applications that are submitted, the commission shall select by July 1, 2020, on-demand transportation programs or partnerships to receive funding based on criteria adopted by the commission in consultation with stakeholders described in subparagraph (A). As part of the criteria, the commission shall require an access provider to demonstrate in its application, at a minimum, how the program or partnership improves response times for WAV service compared to the previous year, the presence and availability of WAVs within the geographic area, and efforts undertaken to publicize and promote available WAV services to disability communities.
The commission shall distribute funds pursuant to subparagraph (E) in the Access Fund within 90 days following the end of each year. If no access provider meets the requirements, funds shall remain in the Access Fund and be distributed the next year.
The commission shall require each transportation network company to be accessible to persons with disabilities in order to be exempt from paying the charge required pursuant to subparagraph (B). The commission shall adopt a designated level of WAV service that is required to be met in each geographic area via a TNC’s online-enabled application or platform in order for the TNC to be exempt from paying the fee required pursuant to subparagraph (B) for the next year in that geographic area. As part of the designated level of WAV service for each geographic area, the commission shall require a TNC, at a minimum, to have response times for 80 percent of WAV trips requested via the TNC’s online-enabled application or platform within a time established by the commission for that geographic area. If a TNC meets the WAV service level requirement established pursuant to this subparagraph in a geographic area selected pursuant to subparagraph (D) for a particular year, the TNC shall be exempt from paying the fee imposed pursuant to subparagraph (B) for the next year for that geographic area only. A TNC may provide a higher level of service than the minimum service level requirement designated by the commission.
A TNC may meet the requirements of clause (ii) of subparagraph (B) and subparagraph (G) by facilitating WAV service through its online-enabled application or platform, by directly providing WAV service with vehicles that it owns, or by a contract to provide WAV service with a transportation provider, or by any combination of these methods.
Within 30 days after the end of each quarter, a transportation network company that receives an offset pursuant to clause (ii) of subparagraph (B) or an access provider that receives funding pursuant to subparagraph (C) shall submit a report to the commission. The report shall include, but shall not be limited to, all of the following:
The number of WAV rides requested.
The number of WAV rides fulfilled.
Data detailing the response time between when a WAV ride was requested and when the vehicle arrived.
Information regarding educational outreach to disability communities, including, but not limited to, information and promotion of availability of WAVs for wheelchair users.
A detailed description of expenditures or investments, as applicable.
The commission shall establish yearly benchmarks for TNCs and access providers to meet to ensure WAV users receive continuously improved, reliable, and available service. These benchmarks shall include, but are not limited to, response times, percentage of trips fulfilled versus trips requested, and number of users requesting rides versus community WAV demand for each geographic area.
The commission shall authorize no more than 2 percent of existing funds collected from TNCs pursuant to Section 421 and deposited into the Public Utilities Commission Transportation Reimbursement Account to be distributed to accessibility advocates who provide a substantial contribution to the proceeding initiated pursuant to this section, and only for the duration of the commission proceeding initiated pursuant to this section. These funds shall only be distributed to advocates for accessible transportation or representatives of a group whose membership uses accessible transportation. The commission shall distribute funds pursuant to this subparagraph in a manner consistent with the requirements of Sections 1803 to 1808, inclusive. The commission shall not increase the fees authorized pursuant to Section 421 in order to fulfill the requirements of this subparagraph. Nothing in this subparagraph is intended to allow parties to obtain intervenor compensation for other transportation proceedings at the commission.
Report to the Legislature by January 1, 2024, on compliance with this section and on the effectiveness of the on-demand transportation programs or partnerships funded pursuant to this section. The report shall include, but not be limited to, all of the following:
A study on the demand for WAVs, including demand according to time of day and geographic area.
An analysis of the reports required to be submitted by access providers receiving funding pursuant to paragraph (1).
The availability of unallocated funds in the Access Fund, including the need to reassess Access Fund allocations.
An analysis of current program capabilities and deficiencies, and recommendations to overcome any identified deficiencies.
The report required by this paragraph shall be submitted to the Legislature in compliance with Section 9795 of the Government Code.
Create a working group with stakeholders described in subparagraph (A) of paragraph (1) to examine the variety of agencies, localities, and programs that provide transportation services for persons with disabilities, including passenger stage carriers and charter-party carriers within the commission’s jurisdiction, in order to evaluate ways to partner with those agencies to provide services to disabled persons in a nonduplicative, nondiscriminatory, and more efficient manner.
Notwithstanding Section 13340 of the Government Code, moneys deposited in the TNC Access for All Fund created pursuant to subparagraph (C) of paragraph (1) of subdivision (a) are continuously appropriated to the commission without regard to fiscal years for purposes of the program established pursuant to this section.
The commission may hire an independent entity to administer the program established pursuant to subdivision (a) and to complete the report required pursuant to paragraph (2) of subdivision (a).
This section does not limit the rights of any person to pursue any remedies or causes of action that they may have under any state or federal law to enforce compliance with those laws or the obligations stated in this section. This section does not expand or limit any obligations, if any, of a transportation network company under existing state or federal disability access laws.
This section shall remain in effect only until January 1, 2032, and as of that date is repealed.
The Legislature does not intend, and nothing in this article shall be construed, to prohibit the commission from exercising its rulemaking authority in a manner consistent with this article, or to prohibit enforcement activities related to transportation network companies.
A participating driver of a transportation network company shall carry proof of transportation network company insurance coverage with him or her at all times during his or her use of a vehicle in connection with a transportation network company’s online-enabled application or platform. In the event of an accident, a participating driver shall provide this insurance coverage information to any other party involved in the accident, and to a police officer, upon request.
Notwithstanding Section 11580.9 of the Insurance Code, or any other law affecting whether one or more policies of insurance that may apply with respect to an occurrence is primary or excess, this article determines the obligations under insurance policies issued to transportation network companies and, if applicable, drivers using a vehicle in connection with a transportation network company’s online-enabled application or platform.
Notwithstanding any limitations contained in Section 1808.1 of the Vehicle Code, a transportation network company is eligible to participate and shall participate in the pull-notice system established pursuant to Section 1808.1 of the Vehicle Code to regularly check the driving records of a participating driver regardless of whether the participating driver is an employee or an independent contractor of the transportation network company.
A transportation network company shall provide all of the following information to a passenger on its online-enabled application or platform at the time the passenger is matched with a transportation network company driver:
The transportation network company driver’s first name and a picture of the driver.
An image of the make and model of the transportation network company driver’s vehicle.
The license plate number of the transportation network company driver’s vehicle.
A transportation network company shall conduct, or have a third party conduct, a local and national criminal background check for each participating driver that shall include both of the following:
The use of a multistate and multijurisdiction criminal records locator or other similar commercial nationwide database with validation.
A search of the United States Department of Justice National Sex Offender Public website.
A transportation network company shall not contract with, employ, or retain a driver if the driver meets either of the following criteria:
Is currently registered on the United States Department of Justice National Sex Offender Public website.
Has been convicted of any of the following offenses:
A violent felony, as defined in Section 667.5 of the Penal Code.
A transportation network company shall not contract with, employ, or retain a driver if the driver has been convicted of any of the following offenses within the previous seven years:
Misdemeanor assault or battery.
A domestic violence offense.
Driving under the influence of alcohol or drugs.
Paragraphs (2) and (3) apply with respect to a conviction of any offense committed in another jurisdiction that includes all of the elements of any of the offenses described or defined in those paragraphs.
This section shall not be interpreted to prevent a transportation network company from imposing additional standards.
A transportation network company that violates, or fails to comply with, this section is subject to a penalty of not less than one thousand dollars ($1,000) nor more than five thousand dollars ($5,000) for each offense.
Notwithstanding Section 1786.12 of the Civil Code, an investigative consumer reporting agency may furnish an investigative consumer report to a transportation network company about a person seeking to become a participating driver, regardless of whether the participating driver is to be an employee or an independent contractor of the transportation network company.
Paragraph (7) of subdivision (a) of Section 1786.18 of the Civil Code does not apply to an investigative consumer report furnished to a transportation network company pursuant to paragraph (1).
A participating driver is required to possess either of the following:
A valid driver’s license issued by the State of California.
In the case of a nonresident active duty military member or a nonresident dependent of an active duty military member, a valid driver’s license issued by the other state or territory of the United States in which the member or dependent is a resident.
A transportation network company shall comply with the provisions of Section 5445.2 and obtain and review the driving history report from the state or territory of the United States that issued the individual’s driver’s license before permitting a nonresident active duty military member or a nonresident dependent of an active duty military member to act as a participating driver and shall ensure that the driver satisfies all requirements applicable to participating drivers, including, but not limited to, the regulations of the commission and the applicable requirements of the Vehicle Code.
A transportation network company shall notify all participating drivers of the applicability of the Vehicle Code and of the code’s availability, including, in particular, Sections 23123 and 23123.5 (relating to the hands-free device laws), Section 21760 (the “Three Feet for Safety Act”), and Section 22454 (relating to rules of the road relating to schoolbuses), to all participating drivers, either on the transportation network company’s internet website or on its application.
Notwithstanding any other law, the City and County of San Francisco may impose a tax on each ride originating in the City and County of San Francisco provided by a participating driver in an amount not to exceed the following:
One and one-half percent of net rider fares for a shared ride in which, prior to commencement of the ride, a passenger requests through the transportation network company’s online-enabled application or platform to share the ride with one or more passengers and each passenger is charged a fare that is calculated, in whole or in part, based on the passenger’s request to share all or part of the ride with one or more passengers, regardless of whether the passenger actually shares all or part of the ride.
Three and one-quarter percent of the net rider fare for a ride other than a ride described in paragraph (1).
Notwithstanding any other law, the City and County of San Francisco may impose a tax on each ride originating in the City and County of San Francisco provided by an autonomous vehicle, whether facilitated by a transportation network company or any other person, in an amount not to exceed the following:
One and one-half percent of net rider fares for a shared ride in which, prior to commencement of the ride, a passenger requests to share the ride with one or more passengers and each passenger is charged a fare that is calculated, in whole or in part, based on the passenger’s request to share all or part of the ride with one or more passengers, regardless of whether the passenger actually shares all or part of the ride.
Three and one-quarter percent of the net rider fare for a ride other than a ride described in paragraph (1).
Notwithstanding subdivisions (a) and (b), the City and County of San Francisco may set a lower tax rate for net rider fares for a ride originating in the City and County of San Francisco provided by a zero-emission vehicle to further incentivize deployment of zero-emission vehicles.
For purposes of this section, “net rider fare” means all charges for a ride, including, but not limited to, charges based on time or distance, or both, and excluding any additional charges such as taxes, airport or venue fees, or fees imposed by the commission.
Moneys collected by the City and County of San Francisco pursuant to this section shall be dedicated to fund transportation operations and infrastructure within the City and County of San Francisco.
A tax imposed pursuant to this section shall be subject to applicable voter approval requirements imposed by law.
A tax imposed pursuant to this section shall expire no later than November 5, 2045.
The program established pursuant to this section shall be known as the California Clean Miles Standard and Incentive Program.
For purposes of this section, “board” means the State Air Resources Board.
This section applies to transportation providers regulated by the commission that provide prearranged transportation services for compensation using an online-enabled application or platform to connect passengers, including autonomous vehicles, charter-party carriers, and new modes of ridesharing technology that may arise through innovation and subsequent regulation.
By January 1, 2020, the board shall establish a baseline for emissions of greenhouse gases for vehicles used on the online-enabled applications or platforms by transportation network companies on a per-passenger-mile basis. For purposes of this section, emissions per-passenger-mile traveled means the estimated emissions from all vehicles miles traveled in periods 1, 2, and 3, as those terms are used by the commission, including miles driven with no passenger in the vehicles, divided by the total number of passenger miles resulting from transport by those vehicles in period 3, including facilitation of walking, biking, and other modes of active or zero-emission transportation. The board shall use 2018 as the baseline year.
By January 1, 2021, the board shall adopt, and the commission shall implement, annual targets and goals, beginning in 2023, for the reduction under the baseline established pursuant to paragraph (1) of emissions of greenhouse gases per passenger-mile driven on behalf of a transportation network company. These targets and goals shall include annual goals for increasing passenger-miles traveled using zero-emission vehicles. These targets and goals shall be consistent with the Zero-Emission Vehicle Action Plan, be consistent with the stated goals detailed in Executive Order B-48-18, be technically and economically feasible, and be based upon data reported by the transportation network companies to the commission.
The data required of transportation network companies to determine average emissions of greenhouse gases per passenger-mile to be calculated by the board and commission shall include, but is not limited to, all of the following:
The total miles completed by drivers.
The percent share of miles completed by qualified zero-emission means, including miles completed by vehicle, walking, biking, other modes of active transportation, and zero-emission vehicles.
Miles-weighted average network-wide grams of carbon dioxide per mile to produce an estimate of the emissions of greenhouse gases.
Total passenger-miles completed using an average passengers-per-trip estimate to account for trips where exact passenger head count data was not captured.
The board shall delay adoption, and the commission shall delay implementation, of the targets and goals pursuant to paragraph (2) if the board or commission finds that unanticipated barriers exist to expanding the usage of zero-emission vehicles by transportation network companies. The board and commission shall review the available data related to barriers to expanding the usage of zero-emission vehicles by transportation network companies no less often than every two years, including data relative to current and future electric transportation adoption rates and charging infrastructure utilization rates.
By January 1, 2022, and every two years thereafter, each transportation network company shall develop a greenhouse gas emissions reduction plan. A transportation network company greenhouse gas emissions reduction plan shall include proposals on how to meet the targets and goals for reducing emissions of greenhouse gases established pursuant to subdivision (b) based upon the following:
In implementing this section, the commission, the board, and the Energy Commission shall ensure that ongoing state planning efforts and funding programs that are intended to accelerate the adoption of zero-emission vehicles and charging infrastructure shall consider the goals of the California Clean Miles Standard and Incentive Program. The commission shall additionally do all the following:
CHAPTER 9. Commercial Air Carriers [5500. - 5513.]
ARTICLE 1. Accident Liability Protection [5500. - 5513.]
As used in this article, “commercial air operator” means any person owning, controlling, operating, renting, or managing aircraft for any commercial purpose for compensation. “Commercial air operator” does not include any person owning, controlling, operating, renting, managing, furnishing, or otherwise providing transportation by hot air balloon for entertainment, sporting, or recreational purposes.
As used in this article, “aircraft” means any contrivance used for navigation of, or flight in, the air. “Aircraft” does not include a hot air balloon furnished or providing transportation for entertainment, sporting, or recreational purposes.
As used in this article, “person” means any individual, firm, partnership, private, municipal or public corporation, limited liability company, company, association, joint stock association, trustee, receiver, assignee, or other similar representative.
All commercial air operators shall maintain in force at least one million dollars ($1,000,000) of liability insurance for personal injury, wrongful death, and property damage resulting from the operation of an aircraft pursuant to this article, with additional liability coverage of one hundred thousand dollars ($100,000) for each passenger for any aircraft covered by this article.
This section shall become operative on July 1, 2018.
This article does not apply to any person licensed under Article 1 (commencing with Section 11701) of Chapter 4 of Division 6 of the Food and Agricultural Code with respect to that person’s operation of an aircraft for the purpose of applying pest control materials or substances by dusting, spraying, or any other manner whereby the materials or substances are applied through the medium of aircraft. That person is subject to Article 2 (commencing with Section 11931) of Chapter 5 of Division 6 of the Food and Agricultural Code with respect to that aircraft operation.
All commercial air operators shall comply with any requirement of a city, county, or city and county that the person obtain a business license as a condition for operating in that city, county, or city and county.
All commercial air operators shall also provide the city, county, or city and county a currently effective certificate of insurance evidencing insurance coverage as required in Section 5503. A new certificate of insurance shall be provided to the city, county, or city and county at least annually or whenever there is a material change in insurance coverage. A city, county, or city and county shall give reasonable notice of this requirement with any business license renewal notification. A city, county, or city and county may charge a reasonable fee for purposes of carrying out the provisions of this subdivision.
This section shall become operative on July 1, 2018.
The protection against liability shall be continued in effect so long as the commercial air operator continues to offer his or her services for compensation. The policy of insurance or surety bond shall not be cancelable on less than 30 days’ written notice to the city, county, or city and county, except in the event of cessation of operations as a commercial air operator.
This section shall become operative on July 1, 2018.
Any commercial air operator who knowingly refuses or fails to procure protection against liability, as required by Section 5503, is guilty of a misdemeanor.
Notwithstanding the provisions of Section 5506, a city, county, or city and county shall have the authority to accept policies of insurance written by nonadmitted insurers subject to Section 1763 of the Insurance Code of this state, provided that the policies of insurance shall meet the rules and regulations adopted therefor by the applicable jurisdiction.
This section shall become operative on July 1, 2018.
Following an administrative hearing, a city, county, or city and county may impose a penalty of not exceeding one thousand dollars ($1,000) upon any commercial air operator who fails to file the evidence of liability protection required by this article.
This section shall become operative on July 1, 2018.
Notwithstanding any other provision of this article, any person owning, controlling, operating, renting, managing, furnishing, or otherwise providing transportation by hot air balloon for hire shall maintain in force at least one million dollars ($1,000,000) of liability insurance for personal injury, wrongful death, and property damage resulting from the operation of a balloon carrying up to 10 passengers, with additional liability coverage of one hundred thousand dollars ($100,000) for each passenger for any balloon carrying more than 10 passengers. A notice shall be provided to every passenger that identifies both the insurer providing a policy of liability insurance to the person providing that transportation and the amount of insurance coverage provided by that policy.
Any person owning, controlling, operating, renting, managing, furnishing, or otherwise providing transportation by hot air balloon for hire shall comply with any requirement of a city, county, or city and county that the person obtain a business license as a condition for operating in that city, county, or city and county. Whenever a city, county, or city and county requires a business license, any person owning, controlling, operating, renting, managing, furnishing, or otherwise providing transportation by hot air balloon for hire shall prominently display the license only within the city or county of the person’s primary place of business frequented by customers and potential customers. Whenever a city, county, or city and county requires a business license, the person shall provide to the city, county, or city and county, a currently effective certificate of insurance evidencing insurance coverage as required in subdivision (a). A new certificate of insurance shall be provided to the city, county, or city and county, at least annually or whenever there is a material change in insurance coverage. A city, county, or city and county shall give reasonable notice of this requirement with any business license renewal notification. Every business license issued by a city, county, or city and county to any person owning, controlling, operating, renting, managing, furnishing, or otherwise providing transportation by hot air balloon for hire and every currently effective certificate of insurance evidencing insurance coverage, shall be maintained as a public record. The city, county, or city and county may charge a reasonable fee for purposes of carrying out the provisions of this subdivision.
Any person who violates subdivision (a) by failing to maintain insurance in force as required by subdivision (a) is guilty of a misdemeanor. Any person who violates subdivision (b) by failing to obtain and maintain a current valid city, county, or city and county business license issued by the local government jurisdiction where the person’s primary place of business is located, in accordance with subdivision (b), is guilty of a misdemeanor.
DIVISION 2.5. THE DIGITAL INFRASTRUCTURE AND VIDEO COMPETITION ACT OF 2006 [5800. - 5970.]
This act shall be known and may be cited as the Digital Infrastructure and Video Competition Act of 2006.
The Legislature finds and declares all of the following:
Increasing competition for video and broadband services is a matter of statewide concern for all of the following reasons:
Video and cable services provide numerous benefits to all Californians including access to a variety of news, public information, education, and entertainment programming.
Increased competition in the cable and video service sector provides consumers with more choice, lowers prices, speeds the deployment of new communication and broadband technologies, creates jobs, and benefits the California economy.
To promote competition, the state should establish a state-issued franchise authorization process that allows market participants to use their networks and systems to provide video, voice, and broadband services to all residents of the state.
Competition for video service should increase opportunities for programming that appeals to California’s diverse population and many cultural communities.
Legislation to develop this new process should adhere to the following principles:
Create a fair and level playing field for all market competitors that does not disadvantage or advantage one service provider or technology over another.
Promote the widespread access to the most technologically advanced cable and video services to all California communities in a nondiscriminatory manner regardless of socioeconomic status.
Protect local government revenues and control of public rights-of-way.
Require market participants to comply with all applicable consumer protection laws.
Complement efforts to increase investment in broadband infrastructure and close the digital divide.
Continue access to and maintenance of the public, education, and government (PEG) channels.
Maintain all existing authority of the California Public Utilities Commission as established in state and federal statutes.
The public interest is best served when sufficient funds are appropriated to the commission to provide adequate staff and resources to appropriately and timely process applications of video service providers and to ensure full compliance with the requirements of this division. It is the intent of the Legislature that, although video service providers are not public utilities or common carriers, the commission shall collect any fees authorized by this division in the same manner and under the same terms as it collects fees from common carriers, electrical corporations, gas corporations, telephone corporations, telegraph corporations, water corporations, and every other public utility providing service directly to customers or subscribers subject to its jurisdiction such that it does not discriminate against video service providers or their subscribers.
Providing an incumbent cable operator the option to secure a state-issued franchise through the preemption of an existing cable franchise between a cable operator and any political subdivision of the state, including, but not limited to, a charter city, county, or city and county, is an essential element of the new regulatory framework established by this act as a matter of statewide concern to best ensure equal protection and parity among providers and technologies, as well as to achieve the goals stated by the Legislature in enacting this act.
It is the intent of the Legislature that a video service provider shall pay as rent a franchise fee to the local entity in whose jurisdiction service is being provided for the continued use of streets, public facilities, and other rights-of-way of the local entity in order to provide service. The Legislature recognizes that local entities should be compensated for the use of the public rights-of-way and that the franchise fee is intended to compensate them in the form of rent or a toll, similar to that which the court found to be appropriate in Santa Barbara County Taxpayers Association v. Board of Supervisors for the County of Santa Barbara (1989) 209 Cal. App. 3d 940.
It is the intent of the Legislature that collective bargaining agreements be respected.
It is the intent of the Legislature that the definition of gross revenues in this division shall result in local entities maintaining their existing level of revenue from franchise fees.
Nothing in this division shall be deemed as creating a vested right in a state-issued franchise by the franchise holder or its affiliates that would preclude the state from amending the provisions that establish the terms and conditions of a franchise.
Nothing in this division shall be construed to eliminate or reduce a telephone corporation’s or video service provider’s obligations under any applicable state or federal environmental protection laws. The local entity shall serve as the lead agency for any environmental review under this division and may impose conditions to mitigate environmental impacts of the applicant’s use of the public rights-of-way that may be required pursuant to the California Environmental Quality Act (Division 13 (commencing with Section 21000) of the Public Resources Code).
The holder of a state franchise shall not be deemed a public utility as a result of providing video service under this division. This division shall not be construed as granting authority to the commission to regulate the rates, terms, and conditions of video services, except as explicitly set forth in this division.
For purposes of this division, the following words have the following meanings:
“Broadband” means any service defined as broadband in the most recent Federal Communications Commission inquiry pursuant to Section 706 of the Telecommunications Act of 1996 (P.L. 104-104).
“Cable operator” means any person or group of persons that either provides cable service over a cable system and directly, or through one or more affiliates, owns a significant interest in a cable system; or that otherwise controls or is responsible for, through any arrangement, the management and operation of a cable system, as set forth in Section 522(5) of Title 47 of the United States Code.
“Cable service” is defined as the one-way transmission to subscribers of either video programming, or other programming service, and subscriber interaction, if any, that is required for the selection or use of video programming or other programming service, as set forth in Section 522(6) of Title 47 of the United States Code.
“Cable system” is defined as set forth in Section 522(7) of Title 47 of the United States Code.
“Commission” means the Public Utilities Commission.
“Franchise” means an initial authorization, or renewal of an authorization, issued by a franchising entity, regardless of whether the authorization is designated as a franchise, permit, license, resolution, contract, certificate, agreement, or otherwise, that authorizes the construction and operation of any network in the right-of-way capable of providing video service to subscribers.
“Franchise fee” means the fee adopted pursuant to Section 5840.
“Holder” or “holder of a state franchise” means a person or group of persons that has been issued a state franchise from the commission pursuant to this division.
“Incumbent cable operator” means a cable operator or OVS serving subscribers under a franchise in a particular city, county, or city and county franchise area on January 1, 2007.
“Local entity” means any city, county, city and county, or joint powers authority within the state within whose jurisdiction a holder of a state franchise under this division may provide cable service or video service.
“Local franchising entity” means the city, county, city and county, or joint powers authority entitled to require franchises and impose fees on cable operators, as set forth in Section 53066 of the Government Code.
“Network” means a component of a facility that is wholly or partly physically located within a public right-of-way and that is used to provide video service, cable service, voice, or data services.
“Open-video system” or “OVS” means those services set forth in Section 573 of Title 47 of the United States Code.
“OVS operator” means any person or group of persons that either provides cable service over an open-video system directly, or through one or more affiliates, owns a significant interest in an open-video system, or that otherwise controls or is responsible for, through any arrangement, the management of an open-video system.
“Public rights-of-way” means the area along and upon any public road or highway, or along or across any of the waters or lands within the state.
“State franchise” means a franchise that is issued pursuant to this division.
“Subscriber” means a person who lawfully receives video service from the holder of a state franchise for a fee.
“Video programming” means programming provided by, or generally considered comparable to programming provided by, a television broadcast station, as set forth in Section 522(20) of Title 47 of the United States Code.
“Video service” means video programming services, cable service, or OVS service provided through facilities located at least in part in public rights-of-way without regard to delivery technology, including Internet protocol or other technology. This definition does not include (1) any video programming provided by a commercial mobile service provider defined in Section 332(d) of Title 47 of the United States Code, or (2) video programming provided as part of, and via, a service that enables users to access content, information, electronic mail, or other services offered over the public Internet.
“Video service provider” means an entity providing video service.
The commission is the sole franchising authority for a state franchise to provide video service under this division. Neither the commission nor any local franchising entity or other local entity of the state may require the holder of a state franchise to obtain a separate franchise or otherwise impose any requirement on any holder of a state franchise except as expressly provided in this division. Sections 53066, 53066.01, 53066.2, and 53066.3 of the Government Code shall not apply to holders of a state franchise.
The application process described in this section and the authority granted to the commission under this section shall not exceed the provisions set forth in this section.
Any person or corporation who seeks to provide video service in this state for which a franchise has not already been issued, after January 1, 2008, shall file an application for a state franchise with the commission. The commission may impose a fee on the applicant that shall not exceed the actual and reasonable costs of processing the application and shall not be levied for general revenue purposes.
No person or corporation shall be eligible for a state-issued franchise, including a franchise obtained from renewal or transfer of an existing franchise, if that person or corporation is in violation of any final nonappealable order relating to either the Cable Television and Video Provider Customer Service and Information Act (Article 3.5 (commencing with Section 53054) of Chapter 1 of Part 1 of Division 2 of Title 5 of the Government Code) or the Video Customer Service Act (Article 4.5 (commencing with Section 53088) of Chapter 1 of Part 1 of Division 2 of Title 5 of the Government Code).
The application for a state franchise shall be made on a form prescribed by the commission and shall include all of the following:
A sworn affidavit, signed under penalty of perjury by an officer or another person authorized to bind the applicant, that affirms all of the following:
That the applicant has filed or will timely file with the Federal Communications Commission all forms required by the Federal Communications Commission before offering cable service or video service in this state.
That the applicant or its affiliates agrees to comply with all federal and state statutes, rules, and regulations, including, but not limited to, the following:
A statement that the applicant will not discriminate in the provision of video or cable services as provided in Section 5890.
A statement that the applicant will abide by all applicable consumer protection laws and rules as provided in Section 5900.
A statement that the applicant will remit the fee required by subdivision (a) of Section 5860 to the local entity.
A statement that the applicant will provide PEG channels and the required funding as required by Section 5870.
That the applicant agrees to comply with all lawful city, county, or city and county regulations regarding the time, place, and manner of using the public rights-of-way, including, but not limited to, payment of applicable encroachment, permit, and inspection fees.
That the applicant will concurrently deliver a copy of the application to any local entity where the applicant will provide service.
The applicant’s legal name and any name under which the applicant does or will do business in this state.
The address and telephone number of the applicant’s principal place of business, along with contact information for the person responsible for ongoing communications with the commission.
The names and titles of the applicant’s principal officers.
The legal name, address, and telephone number of the applicant’s parent company, if any.
A description of the video service area footprint that is proposed to be served, as identified by a collection of United States Census Bureau Block numbers (13 digit) or a geographic information system digital boundary meeting or exceeding national map accuracy standards. This description shall include the socioeconomic status information of all residents within the service area footprint.
If the applicant is a telephone corporation or an affiliate of a telephone corporation, as defined in Section 234, a description of the territory in which the company provides telephone service. The description shall include socioeconomic status information of all residents within the telephone corporation’s service territory.
The expected date for the deployment of video service in each of the areas identified in paragraph (6).
Adequate assurance that the applicant possesses the financial, legal, and technical qualifications necessary to construct and operate the proposed system and promptly repair any damage to the public right-of-way caused by the applicant. To accomplish these requirements, the commission may require a bond.
The commission may require that a corporation with wholly owned subsidiaries or affiliates is eligible only for a single state-issued franchise and prohibit the holding of multiple franchises through separate subsidiaries or affiliates. The commission may establish procedures for a holder of a state-issued franchise to amend its franchise to reflect changes in its service area.
The commission shall commence accepting applications for a state franchise no later than April 1, 2007.
The commission shall notify an applicant for a state franchise and any affected local entities whether the applicant’s application is complete or incomplete before the 30th calendar day after the applicant submits the application.
If the commission finds the application is complete, it shall issue a state franchise before the 14th calendar day after that finding.
If the commission finds that the application is incomplete, it shall specify with particularity the items in the application that are incomplete and permit the applicant to amend the application to cure any deficiency. The commission shall have 30 calendar days from the date the application is amended to determine its completeness.
The failure of the commission to notify the applicant of the completeness or incompleteness of the application before the 44th calendar day after receipt of an application shall be deemed to constitute issuance of the certificate applied for without further action on behalf of the applicant.
The state franchise issued by the commission shall contain all of the following:
The state franchise issued by the commission may be terminated by the video service provider by submitting at least 90 days prior written notice to subscribers, local entities, and the commission.
It is unlawful to provide video service without a state or locally issued franchise.
Subject to the notice requirements of this division, a state franchise may be transferred to any successor in interest of the holder to which the certificate is originally granted, provided that the transferee first submits all of the information required of the applicant by this section to the commission and is in compliance with Section 5970.
In connection with, or as a condition of, receiving a state franchise, the commission shall require a holder to notify the commission and any applicable local entity within 14 business days of any of the following changes involving the holder of the state franchise:
Any transaction involving a change in the ownership, operation, control, or corporate organization of the holder, including a merger, an acquisition, or a reorganization.
A change in the holder’s legal name or the adoption of, or change to, an assumed business name. The holder shall submit to the commission a certified copy of either of the following:
The proposed amendment to the state franchise.
The certificate of assumed business name.
A change in the holder’s principal business address or in the name of the person authorized to receive notice on behalf of the holder.
Any transfer of the state franchise to a successor in interest of the holder. The holder shall identify the successor in interest to which the transfer is made.
The termination of any state franchise issued under this division. The holder shall identify both of the following:
The number of subscribers in the service area covered by the state franchise being terminated.
The method by which the holder’s subscribers were notified of the termination.
A change in one or more of the service areas of the holder of a state franchise pursuant to this division that would increase or decrease the territory within the service area. The holder shall describe the new boundaries of the affected service areas after the proposed change is made.
Prior to offering video service in a local entity’s jurisdiction, the holder of a state franchise shall notify the local entity that the video service provider will provide video service in the local entity’s jurisdiction. The notice shall be given at least 10 days, but no more than 60 days, before the video service provider begins to offer service.
Any video service provider that currently holds a franchise with a local franchising entity is entitled to seek a state franchise in the area designated in that franchise upon meeting any of the following conditions:
The expiration, prior to any renewal or extension, of its local franchise.
A mutually agreed upon date set by both the local franchising entity and video service provider to terminate the franchise provided in writing by both parties to the commission.
When a video service provider that holds a state franchise provides the notice required pursuant to subdivision (n) to a local jurisdiction that it intends to initiate providing video service in all or part of that jurisdiction, a video service provider operating under a franchise issued by a local franchising entity may elect to obtain a state franchise to replace its locally issued franchise. The franchise issued by the local franchising entity shall terminate and be replaced by a state franchise when the commission issues a state franchise for the video service provider that includes the entire service area served by the video service provider and the video service provider notifies the local entity that it will begin providing video service in that area under a state franchise.
Notwithstanding any rights to the contrary, an incumbent cable operator opting into a state franchise under this section shall continue to serve all areas as required by its local franchise agreement existing on January 1, 2007, until that local franchise otherwise would have expired. However, an incumbent cable operator that is also a telephone corporation with less than 1,000,000 telephone customers in California and is providing video service in competition with another incumbent cable operator shall not be required to provide service beyond the area in which it is providing video service as of January 1, 2007.
There is hereby adopted a state franchise fee payable as rent or a toll for the use of the public rights-of-way by holders of the state franchise issued pursuant to this division. The amount of the state franchise fee shall be 5 percent of gross revenues, as defined in subdivision (d) of Section 5860, or the percentage applied by the local entity to the gross revenue of the incumbent cable operator, whichever is less. If there is no incumbent cable operator or upon the expiration of the incumbent cable operator’s franchise, the amount of the state franchise fee shall be 5 percent of gross revenues, as defined in subdivision (d) of Section 5860, unless the local entity adopts an ordinance setting the amount of the franchise fee at less than 5 percent.
The state franchise fee shall apply equally to all video service providers in the local entity’s jurisdiction.
Notwithstanding subparagraph (A), if the video service provider is leasing access to a network owned by a local entity, the local entity may set a franchise fee for access to the network different from the franchise fee charged to a video service provider for access to the rights-of-way to install its own network.
A state-issued franchise shall only be valid for 10 years after the date of issuance, and the holder shall apply for a renewal of the state franchise for an additional 10-year period if it wishes to continue to provide video services in the area covered by the franchise after the expiration of the franchise.
Except as provided in this section, the criteria and process described in Section 5840 shall apply to a renewal registration, and the commission shall not impose any additional or different criteria.
Renewal of a state franchise shall be consistent with federal law and regulations.
The commission shall not renew the franchise if the video service provider is in violation of any final nonappealable court order issued pursuant to this division.
The holder of a state franchise that offers video service within the jurisdiction of the local entity shall calculate and remit to the local entity a state franchise fee, adopted pursuant to subdivision (q) of Section 5840, as provided in this section. The obligation to remit the franchise fee to a local entity begins immediately upon provision of video service within that local entity’s jurisdiction. However, the remittance shall not be due until the time of the first quarterly payment required under subdivision (h) that is at least 180 days after the provision of service began. The fee remitted to a city or city and county shall be based on gross revenues, as defined in subdivision (d), derived from the provision of video service within that jurisdiction. The fee remitted to a county shall be based on gross revenues earned within the unincorporated area of the county. No fee under this section shall become due unless the local entity provides documentation to the holder of the state franchise supporting the percentage paid by the incumbent cable operator serving the area within the local entity’s jurisdiction. The fee shall be calculated as a percentage of the holder’s gross revenues, as defined in subdivision (d). The fee remitted to the local entity pursuant to this section may be used by the local entity for any lawful purpose.
The state franchise fee shall be a percentage of the holder’s gross revenues, as defined in subdivision (d).
No local entity or any other political subdivision of this state may demand any additional fees or charges or other remuneration of any kind from the holder of a state franchise based solely on its status as a provider of video or cable services other than as set forth in this division and may not demand the use of any other calculation method or definition of gross revenues. However, nothing in this section shall be construed to limit a local entity’s ability to impose utility user taxes and other generally applicable taxes, fees, and charges under other applicable provisions of state law that are applied in a nondiscriminatory and competitively neutral manner.
For purposes of this section, the term “gross revenues” means all revenue actually received by the holder of a state franchise, as determined in accordance with generally accepted accounting principles, that is derived from the operation of the holder’s network to provide cable or video service within the jurisdiction of the local entity, including all of the following:
All charges billed to subscribers for any and all cable service or video service provided by the holder of a state franchise, including all revenue related to programming provided to the subscriber, equipment rentals, late fees, and insufficient fund fees.
Franchise fees imposed on the holder of a state franchise by this section that are passed through to, and paid by, the subscribers.
Compensation received by the holder of a state franchise that is derived from the operation of the holder’s network to provide cable service or video service with respect to commissions that are paid to the holder of a state franchise as compensation for promotion or exhibition of any products or services on the holder’s network, such as a “home shopping” or similar channel, subject to paragraph (4) of subdivision (e).
A pro rata portion of all revenue derived by the holder of a state franchise or its affiliates pursuant to compensation arrangements for advertising derived from the operation of the holder’s network to provide video service within the jurisdiction of the local entity, subject to paragraph (1) of subdivision (e). The allocation shall be based on the number of subscribers in the local entity divided by the total number of subscribers in relation to the relevant regional or national compensation arrangement.
For purposes of this section, the term “gross revenue” set forth in subdivision (d) does not include any of the following:
Amounts not actually received, even if billed, such as bad debt; refunds, rebates, or discounts to subscribers or other third parties; or revenue imputed from the provision of cable services or video services for free or at reduced rates to any person as required or allowed by law, including, but not limited to, the provision of these services to public institutions, public schools, governmental agencies, or employees except that forgone revenue chosen not to be received in exchange for trades, barters, services, or other items of value shall be included in gross revenue.
Revenues received by any affiliate or any other person in exchange for supplying goods or services used by the holder of a state franchise to provide cable services or video services. However, revenue received by an affiliate of the holder from the affiliate’s provision of cable or video service shall be included in gross revenue as follows:
To the extent that treating the revenue as revenue of the affiliate, instead of revenue of the holder, would have the effect of evading the payment of fees that would otherwise be paid to the local entity.
The revenue is not otherwise subject to fees to be paid to the local entity.
Revenue derived from services classified as noncable services or nonvideo services under federal law, including, but not limited to, revenue derived from telecommunications services and information services, other than cable services or video services, and any other revenues attributed by the holder of a state franchise to noncable services or nonvideo services in accordance with Federal Communications Commission rules, regulations, standards, or orders.
Revenue paid by subscribers to “home shopping” or similar networks directly from the sale of merchandise through any home shopping channel offered as part of the cable services or video services. However, commissions or other compensation paid to the holder of a state franchise by “home shopping” or similar networks for the promotion or exhibition of products or services shall be included in gross revenue.
Revenue from the sale of cable services or video services for resale in which the reseller is required to collect a fee similar to the franchise fee from the reseller’s subscribers.
Amounts billed to, and collected from, subscribers to recover any tax, fee, or surcharge imposed by any governmental entity on the holder of a state franchise, including, but not limited to, sales and use taxes, gross receipts taxes, excise taxes, utility users taxes, public service taxes, communication taxes, and any other fee not imposed by this section.
Revenue from the sale of capital assets or surplus equipment not used by the purchaser to receive cable services or video services from the seller of those assets or surplus equipment.
Revenue from directory or Internet advertising revenue, including, but not limited to, yellow pages, white pages, banner advertisement, and electronic publishing.
Revenue received as reimbursement by programmers of specific, identifiable marketing costs incurred by the holder of a state franchise for the introduction of new programming.
Security deposits received from subscribers, excluding security deposits applied to the outstanding balance of a subscriber’s account and thereby taken into revenue.
For the purposes of this section, in the case of a video service that may be bundled or integrated functionally with other services, capabilities, or applications, the state franchise fee shall be applied only to the gross revenue, as defined in subdivision (d), attributable to video service. Where the holder of a state franchise or any affiliate bundles, integrates, ties, or combines video services with nonvideo services creating a bundled package, so that subscribers pay a single fee for more than one class of service or receive a discount on video services, gross revenues shall be determined based on an equal allocation of the package discount, that is, the total price of the individual classes of service at advertised rates compared to the package price, among all classes of service comprising the package. The holder’s offering a bundled package shall not be deemed a promotional activity. If the holder of a state franchise does not offer any component of the bundled package separately, the holder of a state franchise shall declare a stated retail value for each component based on reasonable comparable prices for the product or service for the purpose of determining franchise fees based on the package discount.
For the purposes of determining gross revenue under this division, a video service provider shall use the same method of determining revenues under generally accepted accounting principals as that which the video service provider uses in determining revenues for the purpose of reporting to national and state regulatory agencies.
The state franchise fee shall be remitted to the applicable local entity quarterly, within 45 days after the end of the quarter for that calendar quarter. Each payment shall be accompanied by a summary explaining the basis for the calculation of the state franchise fee. If the holder does not pay the franchise fee when due, the holder shall pay a late payment charge at a rate per year equal to the highest prime lending rate during the period of delinquency, plus 1 percent. If the holder has overpaid the franchise fee, it may deduct the overpayment from its next quarterly payment.
Not more than once annually, a local entity may examine the business records of a holder of a state franchise to the extent reasonably necessary to ensure compensation in accordance with this section. The holder shall keep all business records reflecting any gross revenues, even if there is a change in ownership, for at least four years after those revenues are recognized by the holder on its books and records. If the examination discloses that the holder has underpaid franchise fees by more than 5 percent during the examination period, the holder shall pay all of the reasonable and actual costs of the examination. If the examination discloses that the holder has not underpaid franchise fees, the local entity shall pay all of the reasonable and actual costs of the examination. In every other instance, each party shall bear its own costs of the examination. Any claims by a local entity that compensation is not in accordance with subdivision (a), and any claims for refunds or other corrections to the remittance of the holder of a state franchise, shall be made within three years and 45 days of the end of the quarter for which compensation is remitted, or three years from the date of the remittance, whichever is later. Either a local entity or the holder may, in the event of a dispute concerning compensation under this section, bring an action in a court of competent jurisdiction.
The holder of a state franchise may identify and collect the amount of the state franchise fee as a separate line item on the regular bill of each subscriber.
The holder of a state franchise shall designate a sufficient amount of capacity on its network to allow the provision of the same number of public, educational, and governmental access (PEG) channels, as are activated and provided by the incumbent cable operator that has simultaneously activated and provided the greatest number of PEG channels within the local entity under the terms of any franchise in effect in the local entity as of January 1, 2007. For the purposes of this section, a PEG channel is deemed activated if it is being utilized for PEG programming within the local entity’s jurisdiction for at least eight hours per day. The holder shall have three months from the date the local entity requests the PEG channels to designate the capacity. However, the three-month period shall be tolled by any period during which the designation or provision of PEG channel capacity is technically infeasible, including any failure or delay of the incumbent cable operator to make adequate interconnection available, as required by this section.
The PEG channels shall be for the exclusive use of the local entity or its designee to provide public, educational, and governmental channels. The PEG channels shall be used only for noncommercial purposes. However, advertising, underwriting, or sponsorship recognition may be carried on the channels for the purpose of funding PEG-related activities. The PEG channels shall all be carried on the basic service tier. To the extent feasible, the PEG channels shall not be separated numerically from other channels carried on the basic service tier and the channel numbers for the PEG channels shall be the same channel numbers used by the incumbent cable operator unless prohibited by federal law. After the initial designation of PEG channel numbers, the channel numbers shall not be changed without the agreement of the local entity unless the change is required by federal law. Each channel shall be capable of carrying a National Television System Committee (NTSC) television signal.
If less than three PEG channels are activated and provided within the local entity as of January 1, 2007, a local entity whose jurisdiction lies within the authorized service area of the holder of a state franchise may initially request the holder to designate not more than a total of three PEG channels.
The holder shall have three months from the date of the request to designate the capacity. However, the three-month period shall be tolled by any period during which the designation or provision of PEG channel capacity is technically infeasible, including any failure or delay of the incumbent cable operator to make adequate interconnection available, as required by this section.
Any PEG channel provided pursuant to this section that is not utilized by the local entity for at least eight hours per day as measured on a quarterly basis may no longer be made available to the local entity, and may be programmed at the holder’s discretion. At the time that the local entity can certify to the holder a schedule for at least eight hours of daily programming, the holder of the state franchise shall restore the channel or channels for the use of the local entity.
The content to be provided over the PEG channel capacity provided pursuant to this section shall be the responsibility of the local entity or its designee receiving the benefit of that capacity, and the holder of a state franchise bears only the responsibility for the transmission of that content, subject to technological restraints.
The local entity shall ensure that all transmissions, content, or programming to be transmitted by a holder of a state franchise are provided or submitted in a manner or form that is compatible with the holder’s network, if the local entity produces or maintains the PEG programming in that manner or form. If the local entity does not produce or maintain PEG programming in that manner or form, then the local entity may submit or provide PEG programming in a manner or form that is standard in the industry. The holder shall be responsible for any changes in the form of the transmission necessary to make it compatible with the technology or protocol utilized by the holder to deliver services. If the holder is required to change the form of the transmission, the local entity shall permit the holder to do so in a manner that is most economical to the holder.
The provision of those transmissions, content, or programming to the holder of a state franchise shall constitute authorization for the holder to carry those transmissions, content, or programming. The holder may carry the transmission, content, or programming outside of the local entity’s jurisdiction if the holder agrees to pay the local entity or its designee any incremental licensing costs incurred by the local entity or its designee associated with that transmission. A local entity shall not enter into a licensing agreement that imposes higher proportional costs for transmission to subscribers outside the local entity’s jurisdiction.
The PEG signal shall be receivable by all subscribers, whether they receive digital or analog service, or a combination thereof, without the need for any equipment other than the equipment necessary to receive the lowest cost tier of service. The PEG access capacity provided shall be of similar quality and functionality to that offered by commercial channels on the lowest cost tier of service unless the signal is provided to the holder at a lower quality or with less functionality.
Where technically feasible, the holder of a state franchise and an incumbent cable operator shall negotiate in good faith to interconnect their networks for the purpose of providing PEG programming. Interconnection may be accomplished by direct cable, microwave link, satellite, or other reasonable method of connection. Holders of a state franchise and incumbent cable operators shall provide interconnection of the PEG channels on reasonable terms and conditions and may not withhold the interconnection. If a holder of a state franchise and an incumbent cable operator cannot reach a mutually acceptable interconnection agreement, the local entity may require the incumbent cable operator to allow the holder to interconnect its network with the incumbent’s network at a technically feasible point on the holder’s network as identified by the holder. If no technically feasible point for interconnection is available, the holder of a state franchise shall make an interconnection available to the channel originator and shall provide the facilities necessary for the interconnection. The cost of any interconnection shall be borne by the holder requesting the interconnection unless otherwise agreed to by the parties.
A holder of a state franchise shall not be required to interconnect for, or otherwise to transmit, PEG content that is branded with the logo, name, or other identifying marks of another cable operator or video service provider. For purposes of this section, PEG content is not branded if it includes only production credits or other similar information displayed at the conclusion of a program. The local entity may require a cable operator or video service provider to remove its logo, name, or other identifying marks from PEG content that is to be made available through interconnection to another provider of PEG capacity.
In addition to any provision for the PEG channels required under subdivisions (a) to (i), inclusive, the holder shall reserve, designate, and, upon request, activate a channel for carriage of state public affairs programming administered by the state.
All obligations to provide and support PEG channel facilities and institutional networks and to provide cable services to community buildings contained in a locally issued franchise existing on December 31, 2006, shall continue until the local franchise expires, until the term of the franchise would have expired if it had not been terminated pursuant to subdivision (o) of Section 5840, or until January 1, 2009, whichever is later.
After January 1, 2007, and until the expiration of the incumbent cable operator’s franchise, if the incumbent cable operator has existing unsatisfied obligations under the franchise to remit to the local entity any cash payments for the ongoing costs of public, educational, and government access channel facilities or institutional networks, the local entity shall divide those cash payments among all cable or video providers as provided in this section. The fee shall be the holder’s pro rata per subscriber share of the cash payment required to be paid by the incumbent cable operator to the local entity for the costs of PEG channel facilities. All video service providers and the incumbent cable operator shall be subject to the same requirements for recurring payments for the support of PEG channel facilities and institutional networks, whether expressed as a percentage of gross revenue or as an amount per subscriber, per month, or otherwise.
In determining the fee described in subdivision (l) on a pro rata per subscriber basis, all cable and video service providers shall report, for the period in question, to the local entity the total number of subscribers served within the local entity’s jurisdiction, which shall be treated as confidential by the local entity and shall be used only to derive the per subscriber fee required by this section. The local entity shall then determine the payment due from each provider based on a per subscriber basis for the period by multiplying the unsatisfied cash payments for the ongoing capital costs of PEG channel facilities by a ratio of the reported subscribers of each provider to the total subscribers within the local entity as of the end of the period. The local entity shall notify the respective providers, in writing, of the resulting pro rata amount. After the notice, any fees required by this section shall be remitted to the applicable local entity quarterly, within 45 days after the end of the quarter for the preceding calendar quarter, and may only be used by the local entity as authorized under federal law.
A local entity may, by ordinance, establish a fee to support PEG channel facilities consistent with federal law that would become effective subsequent to the expiration of any fee imposed pursuant to subdivision (l). If no such fee exists, the local entity may establish the fee at any time. The fee shall not exceed 1 percent of the holder’s gross revenues, as defined in Section 5860. Notwithstanding this limitation, if, on December 31, 2006, a local entity is imposing a separate fee to support PEG channel facilities that is in excess of 1 percent, that entity may, by ordinance, establish a fee no greater than that separate fee, and in no event greater than 3 percent, to support PEG activities. The ordinance shall expire, and may be reauthorized, upon the expiration of the state franchise.
The holder of a state franchise may recover the amount of any fee remitted to a local entity under this section by billing a recovery fee as a separate line item on the regular bill of each subscriber.
A court of competent jurisdiction shall have exclusive jurisdiction to enforce any requirement under this section or resolve any dispute regarding the requirements set forth in this section, and no provider may be barred from the provision of service or be required to terminate service as a result of that dispute or enforcement action.
Holders of state franchises shall comply with the Emergency Alert System requirements of the Federal Communications Commission in order that emergency messages may be distributed over the holder’s network. Any provision in a locally issued franchise authorizing local entities to provide local emergency notifications shall remain in effect, and shall apply to all holders of a state-issued franchise in the same local area, for the duration of the locally issued franchise, until the term of the franchise would have expired were the franchise not terminated pursuant to subdivision (o) of Section 5840, or until January 1, 2009, whichever is later.
The local entity shall allow the holder of a state franchise under this division to install, construct, and maintain a network within public rights-of-way under the same time, place, and manner as the provisions governing telephone corporations under applicable state and federal law, including, but not limited to, the provisions of Section 7901.1.
Nothing in this division shall be construed to change existing law regarding the permitting process or compliance with the California Environmental Quality Act (Division 13 (commencing with Section 21000) of the Public Resources Code) for projects by a holder of a state franchise.
For purposes of this section, an “encroachment permit” means any permit issued by a local entity relating to construction or operation of facilities pursuant to this division.
A local entity shall either approve or deny an application from a holder of a state franchise for an encroachment permit within 60 days of receiving a completed application. An application for an encroachment permit is complete when the applicant has complied with all statutory requirements, including the California Environmental Quality Act (Division 13 (commencing with Section 21000) of the Public Resources Code).
If the local entity denies an application for an encroachment permit, it shall, at the time of notifying the applicant of the denial, furnish to the applicant a detailed explanation of the reason for the denial.
The local entity shall adopt regulations prescribing procedures for an applicant to appeal the denial of an encroachment permit application issued by a department of the local entity to the governing body of the local entity.
Nothing in this section precludes an applicant and a local entity from mutually agreeing to an extension of any time limit provided by this section.
A local entity may not enforce against the holder of a state franchise any rule, regulation, or ordinance that purports to allow the local entity to purchase or force the sale of a network.
A cable operator or video service provider that has been granted a state franchise under this division may not discriminate against or deny access to service to any group of potential residential subscribers because of the income of the residents in the local area in which the group resides.
Holders or their affiliates with more than 1,000,000 telephone customers in California satisfy subdivision (a) if all of the following conditions are met:
Within three years after it begins providing video service under this division, at least 25 percent of households with access to the holder’s video service are low-income households.
Within five years after it begins providing video service under this division and continuing thereafter, at least 30 percent of the households with access to the holder’s video service are low-income households.
Holders provide service to community centers in underserved areas, as determined by the holder, without charge, at a ratio of one community center for every 10,000 video subscribers. The holder shall not be required to take its facilities beyond the appropriate demarcation point outside the community center building or perform any inside wiring. The community center may not receive service from more than one state franchise holder at a time under this section. For purposes of this section, “community center” means any facility operated by an organization that has qualified for the California Teleconnect Fund, as established in Section 280 and that will make the holder’s service available to the community.
Holders or their affiliates with fewer than 1,000,000 telephone customers in California satisfy this section if they offer video service to all customers within their telephone service area within a reasonable time, as determined by the commission. However, the commission shall not require the holder to offer video service if the cost to provide video service is substantially above the average cost of providing video service in that telephone service area.
When a holder provides video service outside of its telephone service area, is not a telephone corporation, or offers video service in an area where no other video service is being offered, other than direct-to-home satellite service, there is a rebuttable presumption that discrimination in providing service has not occurred within those areas. The commission may review the holder’s proposed video service area to ensure that the area is not drawn in a discriminatory manner.
For holders or their affiliates with more than 1,000,000 telephone customers in California, either of the following shall apply:
If the holder is predominantly deploying fiber optic facilities to the customer’s premise, the holder shall provide access to its video service to a number of households at least equal to 25 percent of the customer households in the holder’s telephone service area within two years after it begins providing video service under this division, and to a number at least equal to 40 percent of those households within five years.
If the holder is not predominantly deploying fiber optic facilities to the customer’s premises, the holder shall provide access to its video service to a number of households at least equal to 35 percent of the households in the holder’s telephone service area within three years after it begins providing video service under this division, and to a number at least equal to 50 percent of these households within five years.
A holder shall not be required to meet the 40-percent requirement in paragraph (1) or the 50-percent requirement in paragraph (2) until two years after at least 30 percent of the households with access to the holder’s video service subscribe to it for six consecutive months.
If 30 percent of the households with access to the holder’s video service have not subscribed to the holder’s video service for six consecutive months within three years after it begins providing video service, the holder may submit validating documentation to the commission. If the commission finds that the documentation validates the holder’s claim, then the commission shall permit a delay in meeting the 40-percent requirement in paragraph (1) or the 50-percent requirement in paragraph (2) until the time that the holder does provide service to 30 percent of the households for six consecutive months.
After two years of providing service under this division, the holder may apply to the state franchising authority for an extension to meet the requirements of subdivision (b), (c), or (e). Notice of this application shall also be provided to the telephone customers of the holder, the Secretary of the Senate, and the Chief Clerk of the Assembly.
Upon application, the franchising authority shall hold public hearings in the telephone service area of the applicant.
In reviewing the failure to satisfy the obligations contained in subdivision (b), (c), or (e), the franchising authority shall consider factors that are beyond the control of the holder, including, but not limited to, the following:
The ability of the holder to obtain access to rights-of-way under reasonable terms and conditions.
The degree to which developments or buildings are not subject to competition because of existing exclusive arrangements.
The degree to which developments or buildings are inaccessible using reasonable technical solutions under commercially reasonable terms and conditions.
Natural disasters.
The franchising authority may grant the extension only if the holder has made substantial and continuous effort to meet the requirements of subdivision (b), (c), or (e). If an extension is granted the franchising authority shall establish a new compliance deadline.
Local governments may bring complaints to the state franchising authority that a holder is not offering video service as required by this section, or the state franchising authority may open an investigation on its own motion. The state franchising authority shall hold public hearings before issuing a decision. The commission may suspend or revoke the franchise if the holder fails to comply with the provisions of this division.
If the state franchising authority finds that the holder is in violation of this section, it may, in addition to any other remedies provided by law, impose a fine not to exceed 1 percent of the holder’s total monthly gross revenue received from provision of video service in the state each month from the date of the decision until the date that compliance is achieved.
If a court finds that the holder of the state franchise is in violation of this section, the court may immediately terminate the holder’s state franchise, and the court shall, in addition to any other remedies provided by law, impose a fine not to exceed 1 percent of the holder’s total gross revenue of its entire cable and service footprint in the state in the full calendar month immediately prior to the decision.
As used in this section, the following definitions shall apply:
“Access” means that the holder is capable of providing video service at the household address using any technology, other than direct-to-home satellite service, providing two-way broadband Internet capability and video programming, content, and functionality, regardless of whether any customer has ordered service or whether the owner or landlord or other responsible person has granted access to the household. If more than one technology is utilized, the technologies shall provide similar two-way broadband Internet accessibility and similar video programming.
“Customer’s household” means those residential households located within the holder’s existing telephone service area that are customers of the service by which that telephone service area is defined.
“Household” means, consistent with the United States Census Bureau, a house, an apartment, a mobilehome, a group of rooms, or a single room that is intended for occupancy as separate living quarters. Separate living quarters are those in which the occupants live and eat separately from any other persons in the building and which have direct access from the outside of the building or through a common hall.
“Low-income household” means those residential households located within the holder’s existing telephone service area where the average annual household income is less than thirty-five thousand dollars ($35,000) based on the United States Census Bureau estimates adjusted annually to reflect rates of change and distribution through January 1, 2007.
Nothing in this section shall be construed to require a holder to provide video service outside its wireline footprint or to match the existing service area of any cable operator.
The commission shall collect granular data on the actual locations served by the holder of a state franchise.
The commission shall adopt customer service requirements for a holder of a state franchise and adjudicate any customer complaints.
The commission shall not publicly disclose any personally identifiable information collected pursuant to this section.
All information submitted to the commission pursuant to this section shall be disclosed to the public only as provided for pursuant to Section 583.
For purposes of this section, “actual locations” include addresses.
The holder of a state franchise shall comply with Sections 53055, 53055.1, 53055.2, and 53088.2 of the Government Code, and any other customer service standards pertaining to the provision of video service established by federal law or regulation or adopted by subsequent enactment of the Legislature. All customer service and consumer protection standards under this section shall be interpreted and applied to accommodate newer or different technologies while meeting or exceeding the goals of the standards.
The holder of a state franchise shall comply with Section 637.5 of the Penal Code and the privacy standards contained in Section 551 and following of Title 47 of the United States Code.
The local entity shall enforce all of the customer service and protection standards of this section with respect to complaints received from residents within the local entity’s jurisdiction, but it may not adopt or seek to enforce any additional or different customer service or other performance standards under Section 53055.3 or subdivision (q), (r), or (s) of Section 53088.2 of the Government Code, or any other law.
The local entity shall, by ordinance or resolution, provide a schedule of penalties for any material breach by a holder of a state franchise of this section. A monetary penalty shall not be assessed for a material breach if it is out of the reasonable control of the holder. Further, a monetary penalty shall not be imposed before January 1, 2007. Any schedule of monetary penalties adopted pursuant to this section shall not exceed five hundred dollars ($500) for each day of each material breach, not to exceed one thousand five hundred dollars ($1,500) for each occurrence of a material breach. However, if a material breach of this section has occurred, and the local entity has provided notice and a fine or penalty has been assessed, and if a subsequent material breach of the same nature occurs within 12 months, the penalties may be increased by the local entity to a maximum of one thousand dollars ($1,000) for each day of each material breach, not to exceed three thousand dollars ($3,000) for each occurrence of the material breach. If a third or further material breach of the same nature occurs within those same 12 months, and the local entity has provided notice and a fine or penalty has been assessed, the penalties may be increased to a maximum of two thousand five hundred dollars ($2,500) for each day of each material breach, not to exceed seven thousand five hundred dollars ($7,500) for each occurrence of the material breach. With respect to video providers subject to a franchise or license, any monetary penalties assessed under this section shall be reduced dollar-for-dollar to the extent any liquidated damage or penalty provision of a current cable television ordinance, franchise contract, or license agreement imposes a monetary obligation upon a video provider for the same customer service failures, and no other monetary damages may be assessed.
The local entity shall give the video service provider written notice of any alleged material breach of the customer service standards of this division and allow the video provider at least 30 days from receipt of the notice to remedy the specified material breach.
A material breach for purposes of assessing penalties shall be deemed to have occurred for each day within the jurisdiction of each local entity, following the expiration of the period specified in subdivision (e), that any material breach has not been remedied by the video service provider, irrespective of the number of customers or subscribers affected.
Any penalty assessed pursuant to this section shall be remitted to the local entity, which shall submit one-half of the penalty to the Digital Divide Account established in Section 280.5.
Any interested person may seek judicial review of a decision of the local entity in a court of appropriate jurisdiction. For this purpose, a court of law shall conduct a de novo review of any issues presented.
This section shall not preclude a party affected by this section from using any judicial remedy available to that party without regard to this section. Actions taken by a local legislative body, including a local franchising entity, pursuant to this section shall not be binding on a court of law. For this purpose, a court of law shall conduct de novo review of any issues presented.
For purposes of this section, “material breach” means any substantial and repeated failure of a video service provider to comply with service quality and other standards specified in subdivision (a).
The Public Advocate’s Office of the Public Utilities Commission may advocate on behalf of video subscribers regarding renewal of a state-issued franchise and enforcement of this section, and Sections 5890 and 5950. For this purpose, the office shall have access to any information in the possession of the commission subject to all restrictions on disclosure of that information that are applicable to the commission.
The holder of a state franchise shall perform background checks of applicants for employment, according to current business practices.
A background check equivalent to that performed by the holder shall also be conducted on all of the following:
Persons hired by a holder under a personal service contract.
Independent contractors and their employees.
Vendors and their employees.
Independent contractors and vendors shall certify that they have obtained the background checks required pursuant to subdivision (b), and shall make the background checks available to the holder upon request.
Except as otherwise provided by contract, the holder of a state franchise shall not be responsible for administering the background checks and shall not assume the costs of the background checks of individuals who are not applicants for employment of the holder.
Subdivision (a) only applies to applicants for employment for positions that would allow the applicant to have direct contact with or access to the holder’s network, central office, or subscriber premises, and perform activities that involve the installation, service, or repair of the holder’s network or equipment.
Subdivision (b) only applies to persons that have direct contact with or access to the holder’s network, central office, or subscriber premises, and perform activities that involve the installation, service, or repair of the holder’s network or equipment.
This section does not apply to temporary workers performing emergency functions to restore the network of a holder to its normal state in the event of a natural disaster or an emergency that threatens or results in the loss of service.
A holder of a state franchise employing more than 750 total employees in California shall annually report to the commission all of the following:
The number of California residents employed by the holder, calculated on a full-time or full-time equivalent basis.
The percentage of the holder’s total domestic workforce, calculated on a full-time or full-time equivalent basis.
The types and numbers of jobs by occupational classification held by residents of California employed by holders of state franchises and the average pay and benefits of those jobs and, separately, the number of out-of-state residents employed by independent contractors, companies, and consultants hired by the holder, calculated on a full-time or full-time equivalent basis, when the holder is not contractually prohibited from disclosing the information to the public. This paragraph applies only to those employees of an independent contractor, company, or consultant that are personally providing services to the holder, and does not apply to employees of an independent contractor, company, or consultant not personally performing services for the holder.
The number of net new positions proposed to be created directly by the holder of a state franchise during the upcoming year by occupational classifications and by category of full-time, part-time, temporary, and contract employees.
Notwithstanding any other provision of this division, any video service provider that currently holds a franchise with a local franchising entity in a county that is a party, either alone or in conjunction with any other local franchising entity located in that county, to a stipulation and consent judgment executed by the parties thereto and approved by a federal district court shall neither be entitled to seek a state franchise in any area of that county, including any unincorporated area and any incorporated city of that county, nor abrogate any existing franchise before July 1, 2014. Prior to July 1, 2014, the video service provider shall continue to be exclusively governed by any existing franchise with a local franchising entity for the term of that franchise and any and all issues relating to renewal, transfer, or otherwise in relation to that franchise shall be resolved pursuant to that existing franchise and otherwise applicable federal and local law. This subdivision shall not be deemed to extend any existing franchise beyond its term.
When an incumbent cable operator is providing service under an expired franchise or a franchise that expires before January 2, 2008, the local entity may extend that franchise on the same terms and conditions through January 2, 2008. A state franchise issued to any incumbent cable operator shall not become operative prior to January 2, 2008.
When a video service provider that holds a state franchise provides the notice required pursuant to subdivision (n) of Section 5840 to a local entity, the local franchising entity may require all incumbent cable operators to seek a state franchise and shall terminate the franchise issued by the local franchising entity when the commission issues a state franchise for the video service provider that includes the entire service area served by the video service provider and the video service provider notifies the local entity that it will begin providing video service in that area under a state franchise.
The holder of a state franchise under this division who also provides stand-alone, residential, primary line, basic telephone service shall not increase this rate to finance the cost of deploying a network to provide video service.
The commission shall not permit a telephone corporation that is providing video service directly or through its affiliates pursuant to a state-issued franchise as an incumbent local exchange carrier to increase rates for residential, primary line, basic telephone service above the rate as of July 1, 2006, until January 1, 2009, unless that telephone corporation is regulated under rate of return regulation. However, the commission may allow rate increases to reflect increases in inflation as shown in the Consumer Price Index published by the Bureau of Labor Statistics. This section does not affect the authority of the commission to authorize an increase in rates for basic telephone service that is bundled with other services and priced as a bundle. Nothing in this section is intended to prohibit implementation of commission decision D. 06-04-071 to the extent it has not been implemented prior to July 1, 2006.
Subject to the requirements of this division, a state franchise may be transferred to any successor in interest of the holder to which the certificate originally is granted, whether this transfer is by merger, sale, assignment, bankruptcy, restructuring, or any other type of transaction, provided that the following conditions are met:
The transferee submits to the commission all of the information required by this division of an applicant.
The transferee agrees that any collective bargaining agreement entered into by a video service provider shall continue to be honored, paid, or performed to the same extent as would be required if the video service provider continued to operate under its franchise for the duration of that franchise unless the duration of that agreement is limited by its terms or by federal or state law.
DIVISION 3. PUBLIC UTILITY FRANCHISES BY LOCAL GOVERNMENTS [6001. - 6467.]
CHAPTER 1. Franchise Provisions in General [6001. - 6092.]
ARTICLE 1. Manner of Granting [6001. - 6017.]
Every franchise or privilege to erect or lay telegraph or telephone wires, to construct or operate street or interurban railroads upon any public street or highway, to lay gas pipes for the purpose of carrying gas for light, heat, or power, to erect poles or wires for transmitting electricity for light, heat, or power, along or upon any public street or highway, or to exercise any other privilege whatever proposed to be granted by the governing or legislative body of any county, city and county, or city shall be granted upon the conditions in this article provided, and not otherwise, except when such franchises are granted pursuant to Chapters 2 or 3 of this division.
This article does not apply to franchises or privileges for railroads, or telegraph or telephone lines doing an interstate business, or to renewals of franchises for piers, chutes, or wharves, or to community antenna television systems, or to franchises or privileges for purposes not involving the furnishing of any service or commodity to the public or any portion thereof.
All franchises, licenses, permits, or other privileges granted to a public utility by any city, county, or city and county holding a freeholder’s charter, to use, or to construct, or lay and use, under, along, across, or upon the public streets, ways, alleys, and places within the municipality, facilities which are part of a pipeline system transmitting oil or products thereof, shall be granted upon the terms and conditions provided in, and in accordance with, this chapter or Chapter 2 (commencing with Section 6201).
It is the intent of the Legislature, in enacting this section, to preempt the ordinance of any chartered municipality insofar as that ordinance governs the granting of franchises to construct facilities which are part of a pipeline system transmitting oil or other products thereof.
The grantor may, in such a franchise, impose such other and additional terms and conditions not in conflict with this article, whether governmental or contractual in character, as in the judgment of the legislative body thereof are to the public interest.
No clause or condition of any kind shall be inserted in any franchise or grant offered or sold under the terms of this article which shall directly or indirectly restrict free and open competition in bidding therefor, and no clause or provision shall be inserted in any franchise offered for sale, which shall in anywise favor one person, firm, or corporation, as against another, in bidding for the purchase thereof.
An applicant for a franchise or privilege shall file with the governing or legislative body of the county or municipality an application, and thereupon that body shall, in its discretion, advertise the fact of the application, together with a statement that it is proposed to grant the franchise or privilege, in one or more newpapers of the county, city and county, or city wherein the franchise or privilege is to be exercised.
The advertisement shall state that bids will be received for the franchise and that it will be awarded to the highest bidder. The advertisement shall be published once a day for 10 successive days, or as often during that period as the paper is published, if it is a daily newspaper. If there is no daily newspaper published in the county, city and county, or city, it shall be published in a weekly newspaper once a week for four successive weeks. In either case the full publication shall be completed not less than 20 nor more than 30 days before any further action can be taken thereon.
The publication shall state the character of the franchise or privilege proposed to be granted, the term for which it is granted, and, if it is for a street railroad, the route to be traversed; that sealed bids therefor will be received up to a certain hour and day named therein, and that the successful bidder and his assigns shall during the life of the franchise pay to the county or municipality two percent (2%) of the gross annual receipts of the grantee arising from the use, operation, or possession of the franchise.
The advertisement shall also contain a statement that the franchise will be struck off, sold, and awarded to the person, firm, or corporation making the highest cash bid therefor; that at the time of the opening of the bids any responsible person, firm, or corporation present or represented may bid for the franchise or privilege a sum not less than 10 percent above the highest sealed bid therefor, and the bid so made may be raised not less than 10 percent by any other responsible bidder and the bidding may so continue until the franchise is finally struck off, sold, and awarded to the highest bidder therefor in lawful money of the United States.
Each sealed bid shall be accompanied with cash or a certified check payable to the treasurer of the county or municipality for the full amount of the bid, and no sealed bid shall be considered unless the cash or check is enclosed therewith. The successful bidder shall deposit at least 10 percent of the amount of his bid with the clerk of the county or municipality before the franchise is struck off to him. If he fails to make the deposit immediately his bid shall not be received, and is void, and the franchise shall then and there be again offered for sale to the bidder who makes the highest cash bid therefor, subject to the same conditions as to deposit. This procedure shall be had until the franchise is struck off, sold, and awarded to a bidder who makes the necessary deposit of at least 10 percent of the amount of his bid.
The successful bidder shall deposit with the clerk of the county or municipality, within 24 hours of the acceptance of his bid, the remaining 90 percent of the amount thereof. If the bidder fails to deposit with the clerk of the county or municipality the remaining 90 percent of his bid within 24 hours after its acceptance, the award to him of the franchise shall be set aside, the deposit made by him shall be forfeited, and no further proceedings for a sale of the franchise shall be had unless it is readvertised and again offered for sale in the manner provided in this article.
The advertisement may also contain a statement that the successful bidder for any franchise or privilege struck off, sold, and awarded under this article shall file a bond running to the county, city and county, or city, approved by the governing body. The advertisement may require a bond executed by an admitted surety insurer. The bond shall be in a penal sum prescribed by the governing body and set forth in the advertisement for bids, and conditioned that the bidder shall well and truly observe, fulfill, and perform each term and condition of the franchise, and that in case of any breach of condition of the bond, the whole amount of the penal sum therein named shall be deemed to be liquidated damages.
The bond if required shall be filed with the governing body within the time specified in the advertisement and if no time is specified within five days after the franchise is awarded. The franchise shall be granted by ordinance to the person, firm, or corporation to whom it has been struck off, sold or awarded. If the bond is not filed within the time required, the award of the franchise may be set aside at any time prior to the filing and, if set aside, any money paid for the franchise shall be forfeited, and if an ordinance has been enacted granting the franchise, the governing or legislative body may repeal the ordinance and the franchise shall, in the discretion of the governing or legislative body, be readvertised and again offered for sale in the same manner and under the same restrictions, as provided in this article.
Notwithstanding any other provision of this article, any franchise heretofore or hereafter granted shall not be invalid or subject to revocation because the bond required by law at the time of the award of such franchise shall not have been filed within the time then prescribed, provided the bond is filed prior to the setting aside of the award or, as the case may be, the repeal of the ordinance granting such franchise.
If the franchise is a renewal of a right already in existence, payment of the percentage of gross receipts shall begin at once upon the granting of the franchise. If the franchise is not a renewal of a right already in existence, no percentage shall be paid for the first five (5) years succeeding the date of the franchise, but thereafter the percentage shall be payable annually. If payment is not made, the franchise shall be forfeited.
If the franchise granted is an extension of an existing street railroad system, the gross receipts shall be estimated to be one-half of the proportion of the total gross receipts of the system which the mileage of this extension bears to the total mileage of the whole system. This estimate is conclusive as to the amount of the gross receipts of the extension.
Work to erect or lay telegraph or telephone wires, to construct street or interurban railroads, to lay gas pipes for the purpose of carrying gas for light, heat, or power, to erect poles or wires for transmitting electricity for light, heat, or power, along or upon any public street or highway, or to exercise any other privilege whatever, a franchise for which has been granted pursuant to this article, shall be commenced in good faith within not more than four months from the granting of the franchise. If not so commenced the franchise shall be declared forfeited.
Work to construct street or interurban railroads shall be completed within not more than three years from the granting of the franchise, and if not so completed the franchise shall be forfeited. For good cause shown, the governing or legislative body may by resolution extend the time for completion, not exceeding three months.
Work under any franchise other than for a street or interurban railroad shall be prosecuted diligently and in good faith so as to meet and fill the reasonable needs of the inhabitants of the territory for the service of which the franchise is granted.
The Attorney General, upon the complaint of any county or municipality, or, in his discretion, upon the complaint of any taxpayer, shall sue for the forfeiture of any franchise granted under this article, for the noncompliance with any condition thereof.
Any member of a governing or legislative body of any county, city and county, or city, who, by his vote, violates or attempts to violate any of the provisions of this article is guilty of a misdemeanor and may be punished therefor as provided by law, and may be deprived of his office by the decree of a court of competent jurisdiction, after trial and conviction.
ARTICLE 2. Transportation of Mail Carriers [6041. - 6041.]
In all cases where application is made to the governing or legislative body of a city or city and county for permission and authority to lay railroad tracks through streets or public highways of any city or city and county, the authorities before granting such permission and authority, in addition to the terms and restrictions which they are by law authorized to impose shall exact and require from the persons or corporation asking such permission and authority, as a condition precedent to the granting of permission, a satisfactory promise and undertaking to permit and allow mail carriers in the employ of the United States Government, at all times while engaged in the actual discharge of duty, to ride on the cars of such railroad without paying any sum of money whatever for fare or otherwise. All such permissions and franchises shall be subject to all other provisions of the laws of this State applicable to street railroads in general, and subject to regulations from city or city and county authorities.
ARTICLE 4. Steam Heat Franchises [6091. - 6092.]
All cities and cities and counties are empowered to grant franchises for the laying of pipes in the streets, roads, avenues, alleys, and public highways therein, for carrying steam heat under high pressure to be used, distributed, and sold to the inhabitants thereof for heating purposes.
The granting of franchises under this article shall be pursuant to Article 1 of this chapter.
CHAPTER 2. Gas, Oil, Electric, and Water Franchises by Municipalities [6201. - 6302.]
ARTICLE 1. General Provisions [6201. - 6205.1.]
This chapter may be cited as the Franchise Act of 1937.
As used in this chapter, “industrial gas” means any substance which is in a gaseous state at ambient conditions of temperature and pressure used for commercial, industrial, or scientific purposes, but does not include any gaseous hydrocarbon used for light, heat, power, or feedstock.
As used in this chapter, municipality includes counties, but no county shall grant a franchise pursuant to this chapter in any incorporated area.
The legislative body of any municipality may grant a franchise to any person, firm, or corporation, whether operating under an existing franchise or not, to use, or to construct and use, poles, wires, conduits, and appurtenances for transmitting and distributing electricity for all purposes, or to use, or to lay and use, pipes and appurtenances for transmitting and distributing gas or industrial gas for all purposes, or to use, or to lay and use, pipes and appurtenances for transmitting and distributing oil or products thereof for all purposes, or to lay and use pipes, ditches, flumes, conduits, and appurtenances for transmitting and distributing water for all purposes, under, along, across, or upon the public streets, ways, alleys, and places within the municipality, upon the terms and conditions provided in this chapter.
The legislative body may in such a franchise impose such other and additional terms and conditions not in conflict with this chapter, whether governmental or contractual in character, as in the judgment of the legislative body are to the public interest.
This chapter provides a procedure, alternative to the procedure provided in Article 1 of Chapter 1 of this division, for the granting of franchises by municipalities. When any proceeding is initiated under this chapter for the granting of a franchise, the provisions of this chapter exclusively govern the granting of such franchise.
This chapter does not apply to any municipality having a freeholders’ charter adopted and ratified under the Constitution and having in such charter provisions for the issuance of franchises by the municipality, but nothing contained in this chapter shall restrict the right of any such chartered municipality to avail itself of the provisions of this chapter wherever it may lawfully do so. The provisions of this chapter relating to the payment of a percentage of gross receipts shall not be construed as a declaration of legislative judgment as to the proper compensation to be paid a chartered municipality for the right to exercise franchise privileges therein.
Notwithstanding Section 6205, all franchises, licenses, permits, or other privileges granted to a public utility by any city, county, or city and county holding a freeholder’s charter containing provisions for the issuance of franchises, to use, or to construct or lay and use, under, along, across, or upon the public streets, ways, alleys, and places within the municipality, facilities which are part of a pipeline system transmitting oil or products thereof, shall be granted upon the terms and conditions provided in, and in accordance with, either this chapter or Chapter 1 (commencing with Section 6001).
On and after January 1, 1990, the compensation to be paid for the franchises, licenses, permits, or other privileges granted by any city, county, or city and county, including those holding a freeholder’s charter, shall be as provided in Section 6231.5.
It is the intent of the Legislature, in enacting this section, to preempt the ordinance of any chartered municipality insofar as that ordinance governs the granting of franchises to construct facilities which are part of a pipeline system transmitting oil or products thereof.
ARTICLE 2. Manner of Granting [6231. - 6235.]
An applicant for a franchise shall file with the legislative body of the municipality in which the franchise is desired an application stating all of the following:
The name of the applicant.
The purpose and term, whether definite or indeterminate, for which the franchise is desired.
That the applicant if granted the franchise will pay to the municipality during the life of the franchise 2 percent of the applicant’s gross annual receipts arising from the use, operation, or possession of the franchise, except that this payment shall be not less than 1 percent of the applicant’s gross annual receipts derived from the sale within the limits of the municipality of the utility service for which the franchise is awarded. If the application is for a franchise complementary to a franchise derived under Section 19 of Article XI of the California Constitution as that section existed prior to its amendment on October 10, 1911, then the applicant shall pay annually, if the application is for an electric franchise, 2 percent of the applicant’s gross annual receipts arising from the use, operation, or possession of the franchise, except that this payment shall be not less than one-half of 1 percent of the applicant’s gross annual receipts from the sale of electricity within the limits of the municipality under both the electric franchises; or, if the application is for a gas, oil pipeline, or water franchise, 2 percent of the applicant’s gross annual receipts arising from the use, operation, or possession of the franchise, except that this payment shall be not less than 1 percent of the gross annual receipts from the sale of gas or water within the limits of the municipality under both the gas franchises or both the water franchises.
Notwithstanding any other provision of this section, if the application is for a franchise for a nonpublic utility pipeline for industrial gas or oil or products thereof, the application shall state that the applicant, if granted the franchise, will pay to the municipality during the life of the franchise either a specified percentage agreed to by the applicant and the municipality of the gross annual receipts of the applicant arising from the use, operation, or possession of the franchise or an annual franchise fee in an amount agreed to by the applicant and the municipality or an annual franchise fee computed by multiplying the sum of one-half cent ($0.005) times the nominal internal diameter of the pipe, expressed in inches, times the number of lineal feet of the pipe within the public streets, ways, alleys, or other public places within the municipality.
An applicant for a franchise to build and operate a pipeline system transmitting oil or products thereof shall file with the legislative body of the municipality in which the franchise is desired an application stating all of the following:
The name of the applicant.
The purpose and term, whether definite or indeterminate, for which the franchise is desired.
That the applicant, if granted the franchise, permit, license, or other privilege, will pay to the municipality an annual fee computed as follows:
The length of pipe expressed in feet located within the franchised area shall be multiplied by the applicable base rate, as adjusted pursuant to subdivision (d), in accordance with the following schedule:
For pipelines with an internal diameter not listed above, the fees shall be in the same proportion to the fees of a 12-inch-diameter pipe as the diameter of the unlisted pipe is to 12 inches.
The annual payment for each lineal foot of pipeline shall be computed and revised each calendar year as follows:
The applicable base rate shall be multiplied by the Consumer Price Index for the area, as published by the United States Department of Labor, Office of Information for the month of September immediately preceding the month in which payment is due and payable, and divided by the Consumer Price Index for June 30, 1989, which is declared to be 100.0. Under no circumstances shall the multiplying factor be less than one.
If the United States Department of Labor, Office of Information discontinues the preparation or publication of a Consumer Price Index for the area, and if no translation table prepared by the Department of Labor is available so as to make those statistics which are then available applicable to the index of June 30, 1989, the municipality shall prescribe a rate of payment which shall, in its judgment, vary from the rates specified in this section in approximate proportion as commodity consumer prices then current vary from commodity consumer prices current in December 1988. On this point, the determination by the municipality shall be final and conclusive.
No fee paid to any municipality pursuant to a franchise, permit, license, or other privilege issued under an ordinance which is in effect on September 1, 1989, which exceeds the fee computed under this section shall be reduced. On or after January 1, 1990, a municipality may collect an additional amount which represents the percentage increase in the Consumer Price Index for the area during the preceding calendar year applied to that fee. The formula used in arriving at that fee shall be applicable to any replacement, modification, or extension of the pipeline. Upon expiration of a franchise, permit, license, or other privilege, the municipality may renew or extend the franchise, permit, license, or other privilege, using the local formula contained in an ordinance which is in effect on September 1, 1989. However, the fee shall not exceed the greater of the fee actually paid on September 1, 1989, or the fee computed pursuant to this section.
Notwithstanding any other provision of law, until January 1, 1990, a municipality which is involved in eminent domain proceedings in which a court order for possession has been issued relating to an easement for a pipeline system transmitting oil or products thereof may adopt an ordinance setting its fee without following the provisions of this section. Upon expiration of the ordinance, the municipality may renew or extend the franchise, license, permit, or other privilege, utilizing the local formula in effect on January 1, 1990, or the fee computed pursuant to this section, whichever is greater.
Notwithstanding any other provision of this section, if the application is for a franchise for a nonpublic utility pipeline for industrial gas or oil or products thereof, the application shall state that the applicant, if granted the franchise, will pay to the municipality during the life of the franchise either of the following:
A specified percentage agreed to by the applicant and the municipality of the gross annual receipts of the applicant arising from the use, operation, or possession of the franchise.
An annual franchise fee in an amount agreed to by the applicant and the municipality, or an annual franchise fee computed by multiplying the sum of one-half of the nominal internal diameter of the pipe, expressed in inches, by the number of lineal feet of the pipe within the public streets, ways, alleys, or other public places within the municipality.
Any nonpublic utility pipeline system transmitting oil or products thereof covered by subdivision (e) on December 31, 1989, that converts to public utility status shall continue to pay the fee established pursuant to subdivision (e) for the remaining term of its franchise, license, permit, or other privilege. Upon expiration of its franchise, license, permit, or other privilege, a nonpublic utility pipeline system transmitting oil or products thereof that has converted or seeks to convert to public utility status shall establish to the satisfaction of the franchising authority all of the following:
Its property is dedicated to the service of the public.
Its rates for transportation are established pursuant to tariffs filed with the Public Utilities Commission.
Its accounts and records are established pursuant to rules and regulations adopted by the commission.
It has filed an appropriate annual report with the commission.
Its rates for transportation are just, reasonable, and nondiscriminatory, as evidenced either by an order of the commission approving those rates, or an application for approval of its rates that is pending with the commission.
Upon receipt of the application the legislative body of the municipality may pass its resolution declaring its intention to grant the franchise applied for, stating the character of the franchise, setting forth a notice of the day, hour, and place when and where all persons having any objection to the granting thereof may appear before the legislative body and be heard thereon, and directing the clerk of the legislative body to publish the notice at least once within fifteen (15) days after the passage of the resolution in a newspaper of general circulation within the municipality.
The time fixed for the hearing shall be not less than twenty (20) nor more than sixty (60) days after the date of the passage of the resolution.
The notice of the time and place of hearing objections shall state that the grantee of the franchise and its successors and assigns will, during the life of its franchise, pay to the municipality the percentage specified in its application, that the percentage will be paid annually from the date of the granting of the franchise, and in the event such payment is not made the franchise will be forfeited. The notice shall also designate the term, whether definite or indeterminate, for which the franchise is proposed to be granted.
At any time not later than the hour set for the hearing of objections, any person interested may make written protest stating objections against the granting of the franchise. The protest shall be signed by the protestant and be delivered to the clerk of the legislative body. At the time set for hearing objections the legislative body shall proceed to hear and pass upon all protests so made and its decision shall be final and conclusive, subject to the right of referendum of the people. The legislative body may adjourn the hearing from time to time.
If no protest in writing is delivered to the clerk up to the hour set for hearing, or such protests as are filed have been heard and determined by the legislative body to be insufficient, or have been overruled or denied, the legislative body may grant the franchise. The franchise shall be granted by ordinance adopted in the manner prescribed by law for the enactment of ordinances by the granting body.
A franchise granted under this chapter does not become effective until the grantee files written acceptance thereof with the clerk of the granting municipality. When so filed the acceptance constitutes a continuing agreement by the grantee that if and when the granting municipality thereafter annexes, or consolidates with, additional territory, all franchises, rights and privileges owned by the grantee therein, except a franchise derived under Section 19 of Article XI of the Constitution as that section existed prior to the amendment thereof adopted October 10, 1911, shall be deemed abandoned within the limits of the additional territory.
ARTICLE 3. Scope of Franchise [6261. - 6265.]
Any franchise granted under this chapter with respect to a given utility service is in lieu of all other franchises, rights, or privileges owned by the grantee, or by any successor of the grantee to any rights under the franchise, for transmitting and distributing the utility service within the limits of the municipality as such limits exist at the time of the granting of the franchise or as they may thereafter exist except any franchise derived under Section 19 of Article XI of the Constitution as that section existed prior to the amendment thereof adopted October 10, 1911. The acceptance of any such franchise granted under this chapter shall operate as an abandonment of all such franchises, rights, and privileges within the limits of such municipality as such limits at any time exist, in lieu of which the franchise is granted under this chapter.
No franchise granted under this chapter in any way impairs or affects the right of the granting municipality to acquire the property of the grantee by purchase or condemnation, and nothing contained in such a franchise shall be construed to contract away, modify or abridge either for a term or in perpetuity the municipality’s right of eminent domain in respect to any public utility.
No franchise granted under this chapter shall ever be given any value before any court or other public authority in any proceeding of any character in excess of the cost to the grantee of the necessary publication and any other sum paid by it to the municipality therefor at the time of acquisition.
Every franchise granted pursuant to this chapter, except when a definite term therefor is specified in the ordinance granting it, is indeterminate, that is to say, every such franchise shall endure in full force and effect until, with the consent of the Public Utilities Commission, it is voluntarily surrendered or abandoned by its possessor, or until the State or some municipal or public corporation purchases by voluntary agreement or condemns and takes under the power of eminent domain, all property actually used and useful in the exercise of the franchise and situate within the territorial limits of the State, municipal, or public corporation purchasing or condemning such property, or until the franchise is forfeited for noncompliance with its terms by the possessor thereof.
Every gas franchise granted pursuant to this chapter confers upon the grantee the right to use, or to lay and use, gas pipes and appurtenances for the purpose of transmitting and distributing gas; every oil franchise so granted confers upon the grantee thereof the right to use, or lay and use, oil pipes and appurtenances for the purpose of transmitting and distributing oil or products thereof; every industrial gas franchise so granted confers upon the grantee the right to use, or lay and use, industrial gas pipelines and appurtenances for the purpose of transmitting and distributing industrial gas; every water franchise so granted confers upon the grantee thereof the right to use, or to lay and use, pipes, ditches, flumes, conduits, and appurtenances for the purpose of transmitting and distributing water; and every electric franchise so granted confers upon the grantee thereof the right to use, or to construct and use, poles, wires or conduits and appurtenances for the purpose of transmitting and distributing electricity for all purposes, under, along, across, or upon the public streets, ways, alleys, and places as they now or hereafter exist within the municipality.
ARTICLE 4. Duties and Liabilities of Grantee [6291. - 6302.]
If the grantee of any franchise granted under this chapter fails, neglects or refuses to comply with any of the provisions or conditions prescribed in this chapter, and does not within ten (10) days after written demand for compliance begin the work of compliance, or after such beginning does not prosecute the work with due diligence to completion, the municipality, by its legislative body, may declare the franchise forfeited.
Any municipality may sue in its own name for the forfeiture of any franchise granted pursuant to this chapter, in the event of noncompliance with any of the conditions thereof by the grantee, its successors, or assigns.
The grantee shall pay to the municipality a sum of money sufficient to reimburse it for all publication expenses incurred by it in connection with the granting of the franchise. Such payment shall be made within thirty (30) days after the municipality furnishes the grantee with a written statement of the expenses.
The grantee of a franchise under this chapter shall construct, install, and maintain all pipes, conduits, poles, wires, and appurtenances in accordance and in conformity with all of the ordinances and rules adopted by the legislative body of the municipality in the exercise of its police powers and not in conflict with the paramount authority of the State, and, as to state highways, subject to the laws relating to the location and maintenance of such facilities therein.
The grantee shall pay to the municipality on demand the cost of all repairs to public property made necessary by any of the operations of the grantee under the franchise.
The grantee shall indemnify and hold harmless the municipality and its officers from all liability for damages proximately resulting from any operations under the franchise.
The grantee shall remove or relocate without expense to the municipality any facilities installed, used, and maintained under the franchise if and when made necessary by any lawful change of grade, alignment, or width of any public street, way, alley, or place, including the construction of any subway or viaduct, by the municipality.
The grantee shall file with the legislative body of the municipality within thirty (30) days after any sale, transfer, assignment, or lease of the franchise or any part thereof, or any of the rights or privileges granted thereby, written evidence of the transaction certified to by the grantee or its duly authorized officers.
The grantee shall file with the clerk of the municipality, within three (3) months after the expiration of the calendar year, or fractional calendar year, following the date of the granting of the franchise and within three (3) months after the expiration of each calendar year thereafter, a verified statement showing in detail the total gross receipts of the grantee, its successors, or assigns during the preceding calendar year or fractional calendar year from the sale of the utility service for which the franchise was granted.
The grantee shall pay to the municipality within fifteen (15) days after the time for filing its statement of gross receipts, in lawful money of the United States, the specified percentage of its gross receipts for the calendar year or fractional calendar year covered by the statement. Any neglect, omission, or refusal by the grantee to file the verified statement, or to pay the percentage at the times or in the manner provided constitutes grounds for the declaration of a forfeiture of the franchise and of all rights thereunder.
The grantee of a franchise under this chapter may be required to file a bond running to the municipality approved by the legislative body, in a penal sum prescribed by the legislative body and set forth in the resolution of intention to grant the franchise, conditioned that the grantee shall well and truly observe, fulfill, and perform each term and condition of the franchise, and that in case of any breach of condition of the bond the amount of the penal sum therein named shall be recoverable.
The bond, if required by the legislative body, shall be filed with the legislative body within five days after the date of the granting of the franchise. If the bond is not so filed, or does not receive the approval of the legislative body, the franchise may be refused or forfeited and any money paid to the municipality in connection therewith shall be retained by the municipality.
The grantee of a franchise under this chapter shall be liable to the granting municipality for all damages proximately resulting from the failure of the grantee well and faithfully to observe and perform any provision of the franchise and any provision of this chapter.
CHAPTER 2.5. Municipal Public Lands Use Surcharge [6350. - 6354.1.]
ARTICLE 1. Intent [6350. - 6350.]
There is hereby created a surcharge to be applied to natural gas and electricity transported over utility and nonutility transmission or distribution systems, or both, constructed under, along, across, or upon the public streets, ways, alleys, and places within a municipality, to replace, but not increase, franchise fees that would have been collected pursuant to this division if not for changes in the regulatory environment such as the “unbundling” of the gas industry.
ARTICLE 2. Definitions [6351. - 6351.]
As used in this chapter:
“Municipality” includes counties.
“Energy transporter” means and includes every utility and nonutility owner or operator, or both, of a natural gas or electric transmission or distribution system, or both, subject to a franchise agreement executed pursuant to this division, provided that proprietary gas pipelines whose franchise fees are set forth in Article 2 (commencing with Section 6231) of Chapter 2 shall not be covered by this chapter.
“Transportation customer” means every person, firm, or corporation, other than the State of California or a political subdivision thereof, transporting gas or electricity on an energy transporter’s transmission or distribution system, or both, when the gas or electricity was purchased by the transportation customer from a third party. Transportation customer shall not include one gas utility transporting gas, for end use in its commission designated service area through another gas utility’s service area, nor shall transportation customer include a utility transporting its own gas through its own gas transmission or distribution system, or both, for purposes of generating electricity or for use in its own operations. In addition, “transportation customer” shall not include a cogeneration or nonutility generation facility when the facility transports electricity through its own electric transmission or distribution system or otherwise delivers electricity in the manner described in Section 218.
“Surcharge” means a municipal surcharge for the use of public lands by a transportation customer as defined in subdivision (c).
ARTICLE 3. Surcharge [6352. - 6353.]
Notwithstanding any other provision of law, a transportation customer who receives transportation service on a natural gas or electric transmission or distribution system, or both, subject to a franchise agreement executed pursuant to this division from an energy transporter shall be subject to a surcharge as defined in Section 6353. Notwithstanding any other provision of this chapter, no county shall impose a surcharge pursuant to this chapter in an incorporated area.
Notwithstanding subdivision (a), the surcharge assessed for gas used to generate electricity by a nonutility facility shall be the same as the surcharge assessed for gas used to generate electricity by the electric utility for that quantity of gas described in Section 454.4. The surcharge amount for electricity shall not apply to the sale of electricity from a cogeneration or nonutility facility to an entity for resale to a retail customer.
Nothing in this chapter permits a municipality to recover surcharges imposed pursuant to this chapter on the commodity cost of gas or electricity transported for transportation customers in addition to franchise fees calculated on the imputed value of the same quantities of gas or electricity. If a municipality has a franchise agreement with an energy transporter that requires the energy transporter to pay a franchise fee based upon an imputed value for the commodity cost of gas or electricity transported but not sold by the energy transporter, the energy transporter may apply the surcharge imposed by this chapter toward the amount of the franchise fee due under the franchise agreement.
Nothing in this chapter shall in any way affect the rights of the parties to existing franchise agreements executed pursuant to this division that are in force on the effective date of this chapter.
Notwithstanding subdivision (a), the surcharge shall not apply to corporations transporting natural gas pursuant to a “gas transportation only” agreement in effect prior to January 1, 1986.
Notwithstanding subdivision (a), an energy transporter of gas that is required to obtain a franchise agreement with a municipality, and that is subject to the jurisdiction of the Federal Energy Regulatory Commission, shall not be required to collect the surcharge imposed by this chapter, but shall be required to negotiate with the municipality under the provisions of this division, franchise fees that recover amounts equivalent to those amounts that would otherwise have been recovered pursuant to this chapter.
For purpose of calculating the surcharge required in Section 6352, the energy transporter shall do all of the following:
For each transportation customer, determine the volume of transported gas or electricity, in therms or kilowatt hours respectively, subject to the surcharge.
Determine the weighted average cost of the energy transporter’s gas or electricity. For gas, the energy transporter shall use its tariffed core subscription weighted average cost of gas (WACOG) exclusive of any California sourced franchise fee factor. For electricity, the energy transporter shall use that portion of the otherwise applicable utility rate or charge which, pursuant to commissioner order, is removed from the bill of a retail electric customer who has elected direct access to reflect the fact that the customer is purchasing energy from a nonutility provider exclusive of any California sourced franchise fee factor. For an energy transporter that does not provide gas or electricity at a commission tariffed rate, the energy transporter shall use the equivalent tariffed rate of the commission regulated energy transporter operating in the same service area.
Determine a product for each transportation customer by multiplying the volume determined pursuant to subdivision (a) by the weighted average cost determined pursuant to subdivision (b).
Determine the surcharge applicable to each transportation customer by multiplying the product determined pursuant to subdivision (c) by the sum of the franchise fee factor plus any franchise fee surcharge authorized for the energy transporter as approved by the commission in the energy transporter’s most recent proceeding in which those factors and surcharges were set. An energy transporter not regulated by the commission shall multiply the product determined in subdivision (c) by the franchise fee rate contained in its individual franchise agreement in effect in each municipality.
The surcharge assessed pursuant to this chapter only applies to the end use point.
ARTICLE 4. Rights, Restrictions, and Compensation [6354. - 6354.1.]
Surcharges calculated pursuant to Section 6353 shall be recovered from the transportation customer through the energy transporter’s normal billing process.
Surcharges collected from the transportation customer shall be remitted to the municipality granting a franchise pursuant to this division in the manner and at the time prescribed for payment of franchise fees in the energy transporter’s franchise agreement. In recognition of costs to be incurred by energy transporters in administering the surcharge established by this chapter, the energy transporter may retain interest earned on cash balances resulting from the timing difference between the monthly collection of the surcharge and the remittance thereof, as required by individual franchise agreements.
In the event that payment on a transportation customer closed account becomes more than 90 days delinquent, or a transportation customer notifies the utility that they refuse to pay the surcharge, the energy transporter shall, within 30 days, notify the municipality of the delinquency and provide information on the name and address of the delinquent transportation customer and the surcharge amount owed. The energy transporter shall not be liable for these delinquent surcharges.
The municipality, including its authorized officials, employees, and agents shall use the delinquent transportation customer information only for the purpose of enforcing the surcharge and shall not disclose the information to any officials, employees, agents, or any third parties who are not responsible for and involved in the enforcement of the municipality’s franchise agreements. Nothing herein precludes the municipality, through appropriate officials, employees, or agents, from contacting the transportation customers in order to collect any surcharges due from the transportation customer.
By March 31 of each year, every person, firm, or corporation that transports gas or electricity to any other person, firm, or corporation within a municipality, upon request of the municipality, shall provide the names and addresses of each of its transportation customers and other information for the preceding calendar year as may be necessary for the municipality to enforce its taxes and fees. The municipality, including its authorized employees and agents, shall use the transportation customer information and any other customer specific information only for the purpose of enforcing its taxes and fees and shall not disclose the information to any officials, employees, agents, or any third parties not responsible for, and involved in, the enforcement of the taxes and fees. Nothing in this subdivision shall prohibit the municipality, through appropriate officials, employees, or agents, from contacting the customers in order to collect any taxes and fees due from the customer.
Notwithstanding any other provision of law, any transportation customer information provided by an energy transporter to a municipality pursuant to this chapter or pursuant to a utility user tax ordinance is not a public record within the definitions contained in the California Public Records Act (Division 10 (commencing with Section 7920.000) of Title 1 of the Government Code).
In acknowledgment of the potential for systems startup costs to be incurred by the energy transporters in implementing this chapter, authorization is hereby granted for each energy transporter to retain 10 percent of the added fees collected pursuant to this chapter on transported gas or electricity for systems startup costs not to exceed seven hundred fifty thousand dollars ($750,000), provided that the portion of collections withheld by the energy transporter shall be apportioned to all municipalities based upon each municipality’s share of total franchise fees allocated by the transporter in the prior calendar year.
Surcharges collected pursuant to this chapter shall be separately identified on the transportation customer’s normal bill. At the request of the energy transporter, the municipality shall publish notice in a newspaper of general circulation announcing the change in method of collecting franchise fees brought about by deregulation. Energy transporters may send out notice to transportation customers announcing the change in method of collecting franchise fees through the surcharge. The mailing costs incurred by the energy transporter shall be considered to be part of the implementation costs referenced in subdivision (g).
In the case of partial payment by a transportation customer, the transportation customer payment shall first be applied to the energy transporter charges. Only after all energy transporter charges have been satisfied, shall remaining payment amounts be used to satisfy the municipality’s surcharge requirement.
Energy transporter collection of the surcharge shall begin on or before April 1, 1994. During the interim period between expiration of the targeted sales program and implementation of the energy transporters surcharge collection program, upon request of the municipality, the energy transporter shall provide the municipality with a monthly list of the names and addresses of the transportation customers within the municipality’s jurisdiction, the volume of transported gas in therms, the applicable tariffed core subscription weighted average cost of gas (WACOG) exclusive of any California sourced franchise factor, and the franchise fee factor authorized by the commission to enable the municipality to collect the surcharge directly from the transportation customers. Notwithstanding any other provision of law, except as provided in Section 6352, a municipality is hereby authorized to collect an interim surcharge computed in accordance with Section 6353 until the energy transporter commences billing of the surcharge pursuant to this chapter.
As an alternative to the requirements of subdivision (h) of Section 6354, an energy transporter may elect to state on each customer’s bill, including both transportation customers and customers receiving bundled services, the amount of that bill which is attributable to local franchise fee charges.
CHAPTER 3. Resettlement of Street, Suburban, and Interurban Railroad Franchises [6451. - 6467.]
The governing or legislative body of any city or city and county having on July 27, 1917, a freeholders’ charter adopted under Section 8 of Article XI of the State Constitution, which charter provides for the resettlement of and the granting of a resettlement franchise to any person, firm, or corporation engaged in operating a public utility in such city or city and county, is empowered to provide for a general resettlement of the franchise rights and to grant a resettlement franchise to any person, firm, or corporation actually engaged in operating a street, suburban, or interurban railroad in the city or city and county, upon written application therefor, and upon such terms and conditions as are in this chapter provided, and may, in the resettlement of any such franchise impose other and additional terms and conditions not in conflict with this chapter.
The resettlement franchise shall be granted after such publication and upon such notice as the governing or legislative body shall by resolution determine, or failing such determination, after such publication and upon such notice as is prescribed by law for the enactment of ordinances by the governing or legislative body.
After the final passage of a resettlement franchise, it shall be referred and submitted to the vote of the electors of the city or city and county at the general or special election next ensuing not less than 20 days after the final passage of the ordinance, or if no general or special election is to be held in the city or city and county within a period of not less than 20 days and not more than 90 days after such final passage, the governing or legislative body may call a special election to submit the ordinance to the electors, the special election to be held not less than 30 days and not more than 60 days after such final passage.
No resettlement franchise shall go into effect until it has received the approval of a majority of the electors voting thereon and until it has been accepted in writing by the grantee.
Every resettlement franchise, permit, or privilege shall confer upon the grantee the right to occupy the roads, streets, highways, avenues, boulevards, lanes, alleys, courts, places, and pathways of the city or city and county, particularly set out in the terms and conditions of the franchise, permit, or privilege, for the purpose of conducting, operating and maintaining thereon a street, suburban, or interurban railroad, subject always to the right of the city or city and county to acquire and possess the property of the grantee.
The grantee shall pay to the city or city and county such a percentage of the net revenue annually collected from any and all sources under and by virtue of the franchise, permit, or privilege as is fixed in the franchise. What constitutes such annual net revenue shall be provided in the franchise.
The legislative or governing body may in a resettlement franchise provide that any new franchise granted to the holder of the resettlement franchise shall be considered as part of the resettlement franchise.
The legislative or governing body may in the resettlement franchise provide that in case of consolidation or annexation to the city or city and county of any territory after the date the resettlement franchise is granted, any franchise to operate the street, suburban, or interurban railroad, or any part thereof, held or claimed by the holder of the resettlement franchise in or for any portion of the consolidated or annexed territory shall thereupon be surrendered to the city or city and county, and that the rights and obligations of the resettlement franchise shall thereupon automatically extend to the additional territory, and that a valuation for the purpose of public acquisition of the properties used and useful, or, in the discretion of the city or city and county, prospectively useful, in the operation of the street, suburban, or interurban railroad in the area consolidated or annexed, and not included in the capital valuation already fixed in the resettlement franchise, shall be added to the capital account of the resettlement franchise grantee at a valuation for the purpose of public acquisition fixed by the Public Utilities Commission, and otherwise determined as provided in this chapter.
Every resettlement franchise shall provide that the grantee shall surrender the franchises or rights, owned or claimed by the grantee, to occupy such portion of the roads, streets, highways, avenues, boulevards, lanes, alleys, courts, places, and pathways as it is proposed that the street, suburban, or interurban railroad shall thereafter occupy under the provisions of the resettlement franchise, and that the grantee shall accept in lieu thereof the rights and privileges granted by the resettlement franchise as a franchise for the continued operation of the street, suburban, or interurban railroad within the limits of the city or city and county or such portion thereof as had theretofore been operated under the franchise or franchises surrendered.
The resettlement franchise, permit, or privilege shall be granted for an indeterminate period, subject always to the right of the city or city and county to acquire and possess the property of the grantee.
The resettlement franchise shall be granted upon the express condition that the city or city and county may, at a valuation for the purpose of public acquisition, fixed and determined as provided in Section 6462, assume ownership by purchase, or take over and possess the property used and useful, or, in the discretion of the city or city and county, prospectively useful property of the franchise grantee, its successors or assigns, upon giving the grantee written notice of its intention to purchase and take over the property, which notice shall be given only when authorized by ordinance of the legislative or governing body of the city or city and county.
The valuation for the purpose of public acquisition of property used and useful, or in the discretion of the city or city and county prospectively useful, and owned by the grantee at the time application is made for a resettlement franchise, permit, or privilege shall be fixed by the Public Utilities Commission. The valuation of such property as fixed by the commission may be set forth in the resettlement franchise, permit, or privilege, in which case a readjustment from time to time of this valuation by the addition of the cost of extensions and betterments and by the deduction of the value of property sold or abandoned, and of the amount of depreciation sustained by the property used or useful or prospectively useful, shall be made in such manner as may in the resettlement franchise be provided.
All expenses of the valuation by the Public Utilities Commission shall be paid by the city or city and county to the commission.
The resettlement franchise shall provide that the grantee, its successors or assigns, shall never claim before any court or other public authority in any proceeding of any character any value for the resettlement franchise, permit, or privilege in excess of the amount originally paid for it by the grantee to the granting authority.
The resettlement franchise may be amended from time to time by ordinance passed by the governing or legislative body of the city or city and county and ratified by the electors of the city or city and county in the manner prescribed for the passage of the resettlement franchise in the first instance, and not otherwise. No such amendment is effective unless accepted in writing by the grantee of the resettlement franchise.
The power of the State, in the exercise of its police power or otherwise through the instrumentality of the Public Utilities Commission or other agency, to provide at any and all times for the supervision and regulation of public utilities is not affected by any franchise, permit, or privilege granted under this chapter.
Nothing in this chapter, nor any provision of any franchise granted under this chapter, shall prevent a city or city and county from acquiring at any time the property of any public utility through the exercise of the right of eminent domain, and no city or county shall contract away, either for a term or in perpetuity, the right of eminent domain in respect to any public utility.
DIVISION 3.5. UTILITY RELOCATION AGREEMENTS [7000. - 7005.]
CHAPTER 1. Relocation for Transit or Transportation Capital Improvement Projects [7000. - 7005.]
For purposes of this chapter, a utility shall mean all of the following:
An electric corporation.
A water corporation.
A telephone corporation.
A telecommunications carrier, as defined in Section 153 of Title 47 of the United States Code.
A gas corporation.
A local publicly owned electric utility and a publicly owned gas utility.
A special district that owns or operates utilities.
This chapter shall also apply to the following entities:
A cable television corporation.
A cable operator, as defined in Section 522 of Title 47 of the United States Code.
For purposes of this chapter, “authority” means the Santa Clara Valley Transportation Authority, as defined in Section 100011.
When a utility enters into a relocation agreement with the authority in connection with a transit or transportation capital improvement project, the agreement may include, but not be limited to, the following elements, as agreed to by the parties:
Location of the work to be completed.
Cost arrangements between the parties for the work to be conducted.
Schedule for the work to be completed.
Remedies for contract impairment.
Definition of default on the part of either party.
Remedies for default by either party.
What constitutes abandonment of utility relocation work, and remedies for addressing any abandonment.
If a utility, cable television corporation, or cable operator abandons utility relocation work under a relocation agreement with the authority in connection with a transit or transportation capital improvement project, the authority may, pursuant to the terms of the relocation agreement made pursuant to subdivision (g) of Section 7002, assume from the utility, cable television corporation, or cable operator the work of relocating utilities that relates to the project within the jurisdiction of the authority.
The authority may issue contracts with another qualified entity to conduct the utility relocation work.
If a collective bargaining agreement specifically does not prohibit a crew or other subgroup of employees of a utility, cable television corporation, or cable operator from performing utility relocation work under a contract with the authority in the case where work has been abandoned by the utility, cable television corporation, or cable operator, then the authority shall offer a first right of refusal to a crew or other subgroup of employees of the utility, cable television corporation, or cable operator, that are qualified to conduct utility relocation work to contract with the authority for the utility relocation work.
If the crew or subgroup identified in paragraph (2) elects not to contract with the authority to conduct the utility relocation work, the authority shall choose a qualified entity from a single list provided by the utility, cable television corporation, or cable operator and, if applicable, the collective bargaining representative of the utility employees that would otherwise perform the work, provided that the utility, cable television corporation, or cable operator, and, if applicable, the collective bargaining representative, choose to provide a list.
Any utility relocation work performed or caused to be performed by the authority shall be done according to industry standards, under the oversight of the utility, cable television corporation, or cable operator, and upon acceptance by the utility, cable television corporation, or cable operator.
The rights and remedies available to the authority under this article are nonexclusive and are cumulative to each other and to the remedies or penalties available to the authority under all other laws or pursuant to contract.
This chapter applies only if all of the following occurs:
The authority has executed a formal, written utility relocation agreement with the utility, cable television corporation, or cable operator.
The utility, cable television corporation, or cable operator abandons the relocation work because of financial hardship or other reasons.
The utility relocation agreement executed by the authority and the utility, cable television corporation, or cable operator allows for the authority to assume the utility relocation work as recourse for the work being abandoned by the utility, cable television corporation, or cable operator.
DIVISION 4. LAWS RELATING TO UTILITY CORPORATIONS AND THEIR EMPLOYEES [7503. - 8290.2.]
CHAPTER 1. Railroad Corporations [7503. - 7727.]
ARTICLE 1. Administration and Finance [7503. - 7508.]
Any person or any corporation formed under the laws of this State or of any other state within the United States that the directors of a railroad corporation may by unanimous concurrence select, may be trustees in any deed of trust securing bonds, debentures, notes, and evidences of indebtedness issued by such railroad corporation.
Revenue derived from passenger rail service on the Northwestern Pacific Railroad right-of-way south of Willits to Larkspur shall only be used for capital improvements to, and operating expenses of, the passenger rail service south of Willits to Larkspur.
Real property on which the Northwestern Pacific Railroad right-of-way south of Willits to Larkspur is located shall not be pledged or mortgaged to fund capital improvements on the right-of-way north of Willits.
Subject to the provisions of Part 1 of Division 1 and of the Corporations Code, any railroad corporation, or person or corporation owning any railroad in this State, may sell, convey, and transfer its property and franchises, or any part thereof, to any other railroad corporation, whether organized under the laws of this State or of any other state or territory, or under any act of Congress. The railroad corporation receiving the conveyance may hold and operate the railroad franchises and property within this State, build and operate extensions and branches thereof, exercise the right of eminent domain for such purposes, and do any other business in connection therewith, as fully and effectually as if the corporation was organized under the laws of this State.
ARTICLE 2. Powers and Duties [7526. - 7538.]
Every railroad corporation has all of the following powers:
To make such examination and surveys as are necessary to the selection of the most advantageous route for the railroad. The officers, agents, and employees of the corporation may enter upon the lands or waters of any person, for this purpose, subject to liability for all damages which they do thereto.
To receive, hold, take, and convey, by deed or otherwise, as a natural person, such voluntary grants and donations of real estate and other property as are made to it to aid and encourage the construction, maintenance, and accommodation of the railroad.
To purchase, or by voluntary grants or donations to receive, enter, take possession of, hold, and use all such real estate and other property as is necessary for the construction and maintenance of such railroad, and for all stations, depots, and other purposes necessary to successfully work and conduct the business of the road.
To lay out its road, not exceeding 10 rods wide, and to construct and maintain it, with one or more tracks, and with such appendages and adjuncts as are necessary for the convenient use of the road.
To construct its roads across, along, or upon any stream of water, watercourse, roadstead, bay, navigable stream, street, avenue, or highway, or across any railway, canal, ditch, or flume which the route of its road intersects, crosses, or runs along, in such manner as to afford security for life and property. The corporation shall restore the stream or watercourse, road, street, avenue, highway, railroad, canal, ditch, or flume thus intersected to its former state of usefulness as near as may be, or so that the railroad does not unnecessarily impair its usefulness or injure its franchise.
To cross, intersect, join, or unite its railroad with any other railroad, either before or after construction, at any point upon its route, and upon the grounds of the other railroad corporation, with the necessary turnouts, sidings, and switches, and other conveniences in furtherance of the objects of its connections. Every corporation whose railroad is intersected by any new railroad shall unite with the owners of the new railroad in forming the intersections and connections, and grant facilities therefor. If the two corporations cannot agree upon the amount of compensation to be made therefor, or the points or the manner of the crossings, intersections, and connections, such matters shall be ascertained and determined as is provided in Part 1 (commencing with Section 201) of Division 1.
To acquire lands, timber, stone, gravel, or other materials to be used in the construction and maintenance of its road, and all necessary appendages and adjuncts.
To change the line of its road, in whole or in part, whenever a majority of the directors so determine, as provided in Section 7531, but the change shall not vary the general route of the road, as contemplated in its articles of incorporation.
Every railroad corporation also has all of the following powers:
To carry persons and property on its railroad, and to receive tolls or compensation therefor.
To erect and maintain all necessary and convenient buildings, stations, depots, fixtures, and machinery for the accommodation and use of its passengers, freight, and business.
To regulate the time and manner in which passengers and property shall be transported, and the tolls and compensation to be paid therefor within the limits prescribed by law and subject to alteration, change, or amendment by the Legislature at any time.
To regulate the force and speed of its locomotives, cars, trains, or other machinery used and employed on its roads.
To establish, execute, and enforce all needful and proper rules and regulations for the management of its business transactions usual and proper for railroad corporations.
To purchase, lease, or acquire the franchises, rights, and property, or any part thereof, of any railroad corporation, leasing or owning any railroad outside of the State, to operate it and use the franchises of any such road, and to build and operate extensions thereof.
To purchase, acquire, and hold the stocks, bonds, or other securities of any railroad corporation organized under the laws of this State or of any other state or territory, with full power to sell them.
Every person or corporation authorized to operate a railroad is authorized to use steam, diesel, electricity, compressed air, or any other suitable motive power, for the purpose of propelling cars or trains on the railroad or upon any portion thereof.
Railroad corporations doing business in this State and organized under any law of this State or the United States, or of any state or territory thereof, may enter into contracts with one another, whereby the one may lease of the other the whole or any part of its railroad, or may acquire of the other the right to use, in common with it, the whole or any part of its railroad.
Every railroad corporation in this State shall, within a reasonable time after its road is finally located, make a map and profile thereof, and of the land acquired for the use thereof, and the boundaries of the several counties through which the road may run, and file it in the Office of the Secretary of State. Every railroad corporation shall file like maps of the parts of the railroad located in different counties in the office of the clerk of the county in which such parts of the road are, there to remain of record forever. The maps and profiles shall be certified by the chief engineer, the acting president, and the secretary of the company. Copies of the map and profiles, so certified and filed, shall be kept in the office of the secretary of the corporation, subject to examination by all parties interested.
If, at any time after the location of the line of the railroad and the filing of the maps and profiles thereof, it appears that the location can be improved, the directors may alter or change the location of the line, and cause new maps and profiles to be filed, showing such changes, in the same offices where the originals are of file. The directors may proceed, in the same manner as the original location was acquired, to acquire and take possession of the new line, but shall sell or relinquish the lands owned by them for the original location, within five years after such change. No new location, as herein provided, shall be so run as to avoid any points named in their articles of incorporation.
Upon receipt by it of an application, filed with either the federal Surface Transportation Board or the Public Utilities Commission, to abandon a line of railroad, the Public Utilities Commission shall forward a copy of the application to the Department of Transportation within 10 days.
The board of directors of any railroad corporation may at any time after the original location and construction of its railroad, in order to provide better facilities for the public service, construct an additional main line track or tracks either adjacent to the located and operated line or otherwise, but always in whole or in part between the same termini. The railroad corporation may, without abandoning the original location, acquire such rights of way as are necessary for the additional track or tracks, with their appendages and adjuncts, of a similar width as provided in Section 7526 for the original location, either by purchase or condemnation, as therein provided, and may operate the additional tracks in conjunction with any tracks previously constructed, as additional facilities for the railroad system. Nothing herein supersedes or repeals any law relating to the regulation of railroad corporations by the commission, or any law requiring railroads to obtain franchises from the cities or counties through which the additional tracks may pass.
Whenever the track of one railroad intersects or crosses the track of another railroad, whether it is a street railroad, wholly within the limits of a city, or other railroad, the rails of either or each road shall be so cut and adjusted as to permit the passage of the cars on each road with as little obstruction as possible. If the persons or corporations owning the railroads cannot agree as to the compensation to be made for cutting and adjusting the rails, the condemnation of the right of way over the one for the use of the other road may be had in proceedings under Title 7, Part 3 of the Code of Civil Procedure, and damages assessed and the right of way granted as in other cases.
Whenever the track of a railroad crosses another railroad or a highway, such railroad or highway may be carried under, over, or on a level with the track, as is most expedient. Where an embankment or cutting necessitates a change in the line of such railroad or highway, the corporation may take such additional lands and material as are necessary for the construction of the road or highway on the new line. If the necessary lands cannot be had otherwise, they may be condemned as provided in Title 7, Part 3 of the Code of Civil Procedure, and when compensation is made therefor the lands become the property of the corporation.
The owner of any lands along or through which any railroad is constructed or maintained, may have such farm or private crossings over the railroad and railroad right of way as are reasonably necessary or convenient for ingress to or egress from such lands, or in order to connect such lands with other adjacent lands of the owner. The owner or operator of the railroad shall construct and at all times maintain such farm or private crossing in a good, safe, and passable condition. The commission shall have the authority to determine the necessity for any crossing and the place, manner, and conditions under which the crossing shall be constructed and maintained, and shall fix and assess the cost and expense thereof.
At every farm or private grade crossing of a railroad where no automatic grade crossing protective device is in place there shall be installed, as a means of protecting the crossing, one or more stop signs of the type described in Section 21400 of the Vehicle Code or of such other design as the commission may prescribe unless, after a hearing, the commission shall find that the installation of such sign or signs at a particular crossing would create a hazard or dangerous condition that would not otherwise exist. At any grade crossing where stop signs are installed or in place, before traversing such crossing the driver of any vehicle shall stop such vehicle not less than 10 nor more than 50 feet from the nearest rail of the track and while so stopped shall listen, and look in both directions along the track, for any approaching train or other equipment using such rails. The vehicle shall remain standing while any train or other equipment using such rails is approaching the crossing and is close enough to constitute a hazard. A driver of any vehicle who fails to keep his vehicle standing while any train or equipment using such rails is approaching the crossing and which is so close as to constitute a hazard is guilty of a misdemeanor.
ARTICLE 3. Rights of Way and Franchises [7551. - 7557.]
Every railroad corporation is granted the right of way for the location, construction, and maintenance of its necessary works, and for every necessary adjunct thereto, over any swamp, overflowed, or other public lands of the State not otherwise disposed of or in use, not in any case exceeding in length or width that which is necessary for the construction of such works and adjuncts, or for the protection thereof, and in no case to exceed 200 feet in width.
These grants do not apply to public lands of the State within the corporate limits of cities, or within three miles thereof.
The Secretary of Transportation may grant to every railroad corporation whose primary business is the transportation of passengers the rights-of-way for the location, construction, and maintenance of its necessary works and for every necessary adjunct thereto over any portion of highway owned by the State of California which is not otherwise disposed of or in use, not in any case exceeding in length or width that which is necessary for the construction of works and adjuncts, or for the protection thereof, and in no case to exceed 200 feet in width.
To ensure that a fair and reasonable price is paid for public acquisition of railroad rights-of-way, it is the intent of the Legislature to have railroad rights-of-way valuation procedures and guidelines developed and adopted for use when state and federal funds are expended.
The Secretary of Transportation in collaboration with other public agencies and within existing resources, shall develop recommended procedures and guidelines for valuation of railroad rights-of-way.
The recommended procedures and guidelines shall be transmitted to the Legislature and Governor on or before March 1, 1994.
Every railroad corporation is granted the right, subject to subdivision (b), to take from any of the lands belonging to the state, adjacent to the works of the corporation, all materials, such as wood, stone, and earth, naturally appurtenant thereto, which may be necessary and convenient for the construction of its works and adjuncts.
Except as specified in subdivision (c), before a railroad corporation may take the materials specified in subdivision (a), the railroad corporation shall enter into an agreement with the Department of General Services to reimburse the state for the full value of the removed materials. The agreement shall contain a provision requiring the railroad corporation to return the land and timber to the natural state which existed prior to the removal of the materials, to the extent it is reasonable to do so, if the Department of General Services determines that requirement to be appropriate.
A railroad corporation may take the materials specified in subdivision (a) without previously entering into the agreement specified in subdivision (b) if the railroad takes these materials for the purpose of reopening a rail line which was closed due to an unforseeable or unexpected event. However, within 30 days after reopening the rail line, the railroad corporation shall enter into an agreement with the Department of General Services to reimburse the state for the full value of the removed materials.
When any selection of a right of way, or land for an adjunct to the works of a railroad corporation, is made by any corporation, the secretary thereof shall transmit to the State Lands Commission, the State Controller, and the recorder of the county in which the selected lands are situate, a plat of the lands so selected, giving the extent thereof and uses for which the lands are claimed or desired, duly verified to be correct. If approved, the State Lands Commission shall so endorse the plat, and issue to the corporation a permit to use the lands, unless, on petition properly presented to the court, a review is had and such use prohibited.
If any corporation receiving state lands or appurtenances thereunder is dissolved, ceases to exist, is discontinued, or the route or line of its works is so changed as not to cover or cross the lands selected, or the use of the lands selected is abandoned, the selected lands revert, and the title is reinvested in the State or its grantees, free from all such uses.
No railroad corporation may use any street, alley, or highway, or any of the land, whether covered by water or otherwise, owned by any city or county, unless the right to do so is granted by a vote of the governing body of the city or county. If any railroad corporation operating within a city or county applies to the governing body of the city or county for a franchise or permit to cross any such street, alley, or highway, with main, branch, side, switching, or spur trackage, the governing body of the city or county, within a reasonable time, shall hold a public hearing upon the application after reasonable notice to the applicant and to the public and shall thereafter grant the franchise or permit applied for upon reasonable terms and conditions unless such governing body reasonably finds that the grant of the franchise or permit would be detrimental to the public interest of the city or county. Nothing in this section imposes any duty upon or limits the authority of, any city organized and existing pursuant to a freeholder’s charter, or any officer thereof.
The governing body of a county, city and county, or city, under such regulations, restrictions, and limitations, and upon such terms and payment of license tax as the county, city and county, or city may provide, may grant franchises to railroad corporations for the construction of elevated or underground railroad tracks over, across, or under the streets and public highways of any such county, city and county, or city, for a term not exceeding 50 years. Before granting such franchise there shall be presented to the governing body a petition signed by the owners of a majority of the landed property, other than public property, on the line of the elevated portion applied for.
Notwithstanding Section 7556, to railroad corporations whose primary business is the transportation of passengers, the governing body of a county, city and county, or city under regulations, restrictions, and limitations, and upon terms and payment of a license tax as the county, city and county, or city may provide, may grant franchises for the construction of elevated or underground railroad tracks over, across, or under the public streets and highways of the county, city and county, or city.
Where any railroad or street railroad tracks are located on property that a public entity is authorized to acquire by eminent domain for road, highway, boulevard, street, or alley purposes or on property that a city, county, or municipal water district is authorized to acquire by eminent domain for the right-of-way of a public utility that it will construct, complete, and maintain, the plaintiff may require the relocation or removal of such tracks by exercise of the power of eminent domain. In such case, the complaint shall contain a description and map of the location and proposed location of such tracks.
ARTICLE 4. Conditional Sale of Railroad Equipment [7576. - 7578.]
In any contract for the sale of railroad or street railway equipment or rolling stock, it is lawful to agree that title to the property sold or contracted to be sold, although possession thereof may be delivered immediately or at any time or times subsequently, shall not vest in the purchaser until the purchase price is fully paid, or that the seller shall have and retain a lien thereon for the unpaid purchase money.
In any contract for the leasing or hiring of railroad or street railway equipment or rolling stock, it is lawful to stipulate for a conditioned sale thereof at the termination of the contract, and that the rentals or amounts to be received under the contract may, as paid, be applied and treated as purchase money, and that the title to the property shall not vest in the lessee or bailee until the purchase price has been paid in full and until the terms of the contract have been fully performed, notwithstanding delivery to and possession by the lessee or bailee.
No contract of the type provided for in this article shall be valid as against any subsequent judgment creditor or any subsequent bona fide purchaser for value and without notice, unless all of the following conditions are met:
The contract is evidenced by an instrument executed by the parties and duly acknowledged by the vendee, lessee, or bailee, as the case may be, or duly proved before some person authorized by law to take acknowledgments of deeds, and in the same manner as deeds are acknowledged or proved.
Each car or locomotive engine so sold, leased, or hired, or contracted to be sold, leased, or hired has the name of the vendor, lessor, or bailor plainly marked in letters not less than one inch in size on each side thereof, followed by the word “owner,” or “lessor,” or “bailor,” as the case may be.
ARTICLE 5. Railroad Equipment [7601. - 7614.]
Except as provided in Section 7602 every common carrier by railroad operating within this State shall maintain, on what is known as passing track sidings, a signboard in connection with each derailing switch or other derailing device, whether the derailer is operated where located or from a distance. The signboard shall be placed within 100 feet of the derailer and shall be constructed in either of two forms, viz: board five feet high and 10 inches wide, or sign constructed of two parts, one of which is an upright and the other a transverse board, the upright to be of sufficient height to securely fasten at the top thereof the transverse board, which shall be not less than two feet three inches long and seven inches wide and placed in such a manner that the upper side of the transverse board is not less than four feet above the ties. The board shall have painted thereon the word “derail” in large black letters on a white background.
The commission shall enforce this section.
Section 7601 does not apply to any track, siding, spur, or other track owned by private persons for their own use, except when the track, siding, spur, or other track is operated regularly in connection with the line of a common carrier for certain periods, in which case Section 7601 does apply. Section 7601 does not apply to the placing of signboards in places where physical conditions of track will not permit.
Any corporation, company, or person, or any officer, superintendent, manager, or other agent thereof, who violates any of the provisions of Sections 7601 or 7602, is guilty of a misdemeanor, and, upon conviction thereof, shall be fined not less than twenty-five dollars ($25), nor more than five hundred dollars ($500) for each offense. Any failure, refusal, or neglect to provide any such signboard at any derailing switch or other derailing device constitutes a separate offense.
Except as provided in paragraph (3), a bell, siren, horn, whistle, or similar audible warning device shall be sounded at any public crossing in accordance with Section 222.21 of Title 49 of the Code of Federal Regulations.
Except as provided in paragraph (3), a bell, siren, horn, whistle, or similar audible warning device shall be sounded, consistent with paragraph (1), at all rail crossings not subject to the requirements of Subpart B (commencing with Section 222.21) of Part 222 of Title 49 of the Code of Federal Regulations.
A bell, siren, horn, whistle, or similar audible warning device shall not be sounded in those areas established as quiet zones pursuant to Subpart C (commencing with Section 222.33) of Part 222 of Title 49 of the Code of Federal Regulations.
This section does not restrict the use of a bell, siren, horn, whistle, or similar audible warning device during an emergency or other situation authorized in Section 222.23 of Title 49 of the Code of Federal Regulations.
Any railroad corporation violating this section shall be subject to a penalty of two thousand five hundred dollars ($2,500) for every violation. The penalty may be recovered in an action prosecuted by the district attorney of the proper county, for the use of the state. The corporation is also liable for all damages sustained by any person, and caused by its locomotives, train, or cars, when the provisions of this section are not complied with.
Every railroad corporation, or receiver or lessee thereof, operating any line of railroad in this State by steam locomotives, shall equip all steam locomotives used or to be used in the hauling or propelling of trains over the railroad with a bell ringer apparatus or device which, when set in operation, will ring and continue to ring the locomotive bell automatically, and which is so constructed that it may be set in operation from either or both sides of the locomotive cab.
Any railroad company, receiver or lessee thereof, operating any line of railroad within this State by steam locomotives, violating this section shall be punished by a fine of not less than one hundred dollars ($100) or more than one thousand dollars ($1,000) for each offense.
Every steam locomotive used upon a railroad in this State, carrying passengers or freight for hire, shall be equipped with one or more water glasses of the type known as the “solid water glass,” the same being a solid piece of glass with open flutings at the back thereof, which flutings will permit the raising and falling of water in the boiler of the locomotive to be plainly visible from each side of the cab without the use of a reflector. The glass shall not be less than seven inches in length and one and one-quarter inches in width, and five-eighths of an inch in thickness.
Any person, firm, or corporation operating any such steam locomotive which is not equipped with one or more water glasses as described in this section is guilty of a misdemeanor.
Every railroad corporation, or receiver or lessee thereof, operating any line of railroad in this State, shall equip all locomotive engines used in the transportation of trains over the railroad with electric or other headlights which will project sufficient light to enable the locomotive engineer to observe clearly a dark object the size of an average man, at a distance of not less than 800 feet on a dark, clear night while his train is running at a rate of speed not less than 30 miles per hour.
This section shall not apply to locomotive engines regularly used in the switching of cars or trains or used exclusively between sun up and sun down, or going to or from repair shops when ordered in for repairs, nor to locomotive engines used on short lines or local lines where in the judgment of the commission, the headlight required by this section is not necessary for the preservation of public safety.
Any railroad company, or receiver or lessee thereof, who violates this section, is liable to the State for a penalty of not less than one hundred dollars ($100), nor more than one thousand dollars ($1,000), for each offense. Suit shall be brought to recover the penalty in a court of competent jurisdiction, in the name of the people of the State of California, by the Attorney General or by the district attorney of any county in or through which the railroad is operated.
Every railroad company, or the receiver or receivers of any railroad, operating trains within this state, shall provide a first aid kit containing written instructions for the use of its contents, on each train or light engine, however propelled, for first aid to persons who may be injured in the course of the operation of the train.
The contents of every first aid kit shall be prescribed or approved by the Public Utilities Commission.
The employee of the railroad in charge of the train or engine, however propelled, shall report to the office designated by the company whenever any first aid kit has been opened for use.
Any railroad company, or the receiver or receivers, or employee of a railroad company, who fails to comply with this section is liable to a penalty of not less than five dollars ($5) nor more than twenty-five dollars ($25), and each day’s violation shall constitute a separate offense, except that the railroad company, or receiver or receivers, shall be allowed not to exceed three days without penalty to replace any item after the use of the item has been reported by the employees in charge of the train or engine, however propelled.
Every railroad company, or the receiver or receivers thereof, operating trains in whole or in part within this State, shall provide an emergency first-aid kit on each caboose, locomotive, motor or diesel engine. The emergency first-aid kit shall be used only to render first medical or surgical aid to injured passengers, employees, or other injured persons requiring such aid at the first possible moment.
The employee of any railroad company, or the receiver or receivers thereof, having charge of any passenger train, caboose, locomotive, motor or diesel engine shall report in writing as soon as possible to the office or officer designated by the company or receiver for such purpose, whenever any emergency first-aid kit has been used or has been found missing.
Any person or any employee of any railroad company, or the receiver or receivers thereof, who removes, carries away from its proper place, or uses any emergency first-aid kit, except for the purpose of administering first aid in the event of injury to any passenger, employee, or other person, is guilty of a misdemeanor, and is punishable by a fine of not less than fifty dollars ($50).
It shall be unlawful for any owner or operator of a railroad running through or within the boundaries of the State of California and engaged in the business of common carrier to operate for or transport its employees in a rail track motor car which is not equipped with a transparent windshield sufficient in width and height to reasonably protect said employees, which said windshield shall be of plastic or safety glass and such car shall also be equipped with an electric headlamp of sufficient candle power as to render visible at a distance of 300 feet in advance of such car under ordinary atmospheric conditions, any obstruction, landmark, warning sign or grade crossing on such railroad, and said car shall also be equipped with at least one electric light on the rear end thereof with sufficient candle power as to be visible at a distance of 300 feet under ordinary atmospheric conditions, and such car shall also be equipped with a suitable device that will remove rain, snow and sleet from the windshield on such car. The head and rear lights provided for in this section shall only be required in the hours between one-half hour before sunset and one-half hour after sunrise.
On and after July 1, 1954, any owner or operator of a railroad running through or within this State as a common carrier of persons or property or both, for compensation, which either operates for its employees, or which furnishes to its employees for their transportation to or from the place or places where they are required to labor, a rail track motor car that has not been fully equipped as required by Section 7612 of this code, shall be guilty of a misdemeanor; provided, that any common carrier that has not been able to equip its railroad track motor cars as required by the provisions of said section on or before July 1, 1954, may apply to the Public Utilities Commission for additional time. Upon good cause shown, the Public Utilities Commission is hereby authorized to grant additional time by order to any owner or operator of a common carrier by railroad in which to equip such cars, not to exceed one year from July 1, 1954. When such an order has been granted by said Public Utilities Commission to such carrier, the provisions of this section penalizing such rail carrier which has not so equipped its cars shall not be applicable during the period granted to it.
It shall be unlawful for any owner or operator of a railroad running through or within the boundaries of the State of California and engaged in the business of common carrier to operate for or transport the public or its employees in a caboose which is not provided with flush-type toilet facilities, or chemical type toilet facilities approved by the commission.
ARTICLE 6. Fences [7626. - 7631.]
Every railroad corporation shall make and maintain a good and sufficient fence on both sides of its track and property. If it does not and if its engine or cars kill or maim any cattle or other domestic animals upon its line of road, except where the road runs through or upon public land it shall pay to the owner of the cattle or other domestic animals a fair market price for them, unless the killing or maiming occurred through the neglect or fault of the owner of the animal.
A railroad corporation that pays to the owner of the land through or along which its road is located an agreed price for making and maintaining a good and sufficient fence, or that pays the cost of such fence with the award of damages allowed for the right of way for the railroad, is relieved and exonerated from all claims for damages arising out of the killing or maiming of any animals of persons who thus fail to construct and maintain the fence. The owners of such animals are responsible for any damages or loss which may accrue to the corporation from the animals being upon its railroad track as a result of the nonconstruction of such fence, unless it is shown that the loss or damage occurred through the negligence or fault of the corporation, its officers, agents, or employees.
The commission may require every railroad corporation operating any steam or electric railroad in this State to erect and maintain lawful fences on each or either side of the railroad where the railroad runs through or upon lands of the United States or of this State, at such places as the commission determines that such fences are necessary to protect cattle, horses, or mules, or any other domestic animal being ranged or grazed upon lands adjacent to the railroad from being maimed or killed by the operation or management of engines, cars, or other rolling stock upon or over the railroad, with necessary openings and gates in the fences, and crossings and cattle guards for such openings and gates.
The authority of the commission to require such fences shall be exercised in each instance only when a verified application is filed with the commission by the person or persons owning cattle, horses, mules, or other domestic animals with the right or privilege to range or graze them upon the lands adjacent to the portion of the railroad sought to be fenced.
The application shall specify the ownership of the railroad sought to be fenced, and shall set forth a sufficient description of the lands to identify them, the agency or department of government administering the lands, and the nature of the right or privilege of each petitioner to range or graze domestic animals thereon.
Upon the filing of the application, notice thereof and of any hearing by the commission thereon shall be given by mail by the commission to the agency or department of government administering the land, and to the railroad corporation owning or operating the railroad. Such owners, agency or department, and the railroad may protest the granting of the application and may be heard thereon.
Upon hearing the commission shall determine whether or not any fence or fences are necessary to protect cattle, horses, mules, or any other domestic animals being ranged or grazed upon the land designated in the application, from being maimed, or killed by the operation or management of engines, cars, or other rolling stock upon the railroad, and shall order that a fence or fences be constructed and maintained by the railroad corporation at such places along the railroad adjacent to the lands designated in the petition as the commission determines. The commission may fix the time within which the fence or fences shall be constructed and may designate the places for necessary openings and gates therein and crossings and cattle guards in connection therewith.
The commission may modify or revoke any such order when it determines that the necessity for any such fence has ceased to exist.
The failure of any railroad corporation to comply with any order of the commission authorized by this article shall not subject it, or any of its officers, agents, or employees, to any penalty other than payment by the railroad corporation to the owner of the maimed or killed cattle, or other domestic animals of a fair market price for the animals.
Nothing in this article requires a railroad corporation to pay for the maiming or killing of any cattle or domestic animals where the maiming or killing resulted from the neglect or fault of the owner of the animals.
ARTICLE 7. Operation [7653. - 7663.]
Every railroad corporation shall furnish, on the inside of its passenger cars, sufficient room and accommodations for all passengers to whom tickets are sold for any one trip, and for all persons presenting tickets entitling them to travel thereon. When fare is taken for transporting passengers on any baggage, wood, gravel, or freight car, the same care shall be taken and the same responsibility is assumed by the corporation as for passengers on passenger cars.
Every railroad corporation shall print and conspicuously post on the inside of its passenger cars its rules and regulations regarding fare and conduct of its passengers. In case any passenger is injured on or from the platform of a car, or on any baggage, wood, gravel, or freight car, in violation of such printed regulations, or in violation of positive verbal instructions or injunctions given to the passenger in person by any officer of the train, the corporation is not responsible for damages for the injuries, unless the corporation has failed to comply with the provisions of Section 7653.
A check shall be affixed to every package or parcel of baggage when taken for transportation by any agent or employee of a railroad corporation and a duplicate thereof given to the passenger or person delivering the baggage. If the check is refused on demand, the railroad corporation shall pay to the passenger the sum of twenty dollars ($20), to be recovered in an action for damages.
If any passenger refuses to pay his fare, or to exhibit or surrender his ticket, when reasonably requested to do so, the conductor and employees of the corporation may, on stopping the train, put him and his baggage out of the cars, using no unnecessary force, at any usual stopping place, or near any dwelling house.
Every conductor, baggage master, engineer, brakeman, or other employee of any railroad corporation, employed on a passenger train or at stations for passengers, shall wear upon his hat or cap, or in some conspicuous place on the breast of his coat, a badge, indicating his office or station, and the initial letters of the name of the corporation by which he is employed. No collector or conductor, without such badge, is authorized to demand or to receive from any passenger any fare, toll, or ticket, or exercise any of the powers of his office or station. No other officer or employee, without such badge, has any authority to meddle or interfere with any passenger or property.
No city or county or city and county ordinance which establishes a limit on the speed of trains shall be valid unless that ordinance has been approved by the commission.
Notwithstanding any city or county or city and county ordinance to the contrary, no railroad conductor or engineer, who, while operating a train, obstructs a railroad crossing, shall be subject to any criminal penalty, where he has no control over the situation causing the obstruction, or where the train cannot be moved without endangering the safety of the passengers or freight.
The commission, in authorizing any restrictions on the speed of rail services, shall do so only upon receipt of evidence and a finding (a) that the restriction is required due to track condition, alignment, curvature of tracks, superelevation, or inadequate right-of-way protection, or any combination thereof, as the case may be, and (b) that higher speeds will have an adverse impact upon the health and safety of the public until the specified conditions are changed.
The commission shall require every railroad corporation operating in this state to develop, within 90 days of the effective date of the act adding this section, in consultation with, and with the approval of, the Office of Emergency Services, a protocol for rapid communications with the Office of Emergency Services, the Department of the California Highway Patrol, and designated county public safety agencies in an endangered area if there is a runaway train or any other uncontrolled train movement that threatens public health and safety.
A railroad corporation shall promptly notify the Office of Emergency Services, the Department of the California Highway Patrol, and designated county public safety agencies, through a communication to the Warning Center of the Office of Emergency Services, if there is a runaway train or any other uncontrolled train movement that threatens public health and safety, in accordance with the railroad corporation’s communications protocol developed pursuant to subdivision (a).
The notification required pursuant to subdivision (b) shall include the following information, whether or not an accident or spill occurs:
The information required by subdivision (c) of Section 7673.
In the event of a runaway train, a train list.
In the event of an uncontrolled train movement or uncontrolled movement of railcars, a track list or other inventory document if available.
The division of the commission responsible for railroad safety shall investigate any incident that results in a notification required pursuant to subdivision (b).
A railroad corporation shall place appropriate signage to notify an engineer of an approaching grade crossing, consistent with federal law.
Whistle post signs shall be deemed to satisfy this requirement.
Whenever a railroad issues written or verbal instructions to employees that may restrict or stop train movements because of track conditions, structures, persons, or equipment working, appropriate flags that are readily visible and easily recognizable to the crews on both passenger and freight trains shall be displayed as quickly as practicable. Yellow flags shall be used for temporary speed restrictions, consistent with paragraphs (2) and (3). Yellow-red flags shall be used, consistent with paragraphs (4) and (5), when a train may be required to stop.
Yellow flags shall be used to warn trains to restrict movement because of track conditions or structures. Except as provided in paragraph (3), a yellow flag shall be displayed two miles before the restricted area in order to ensure that train movement is restricted at the proper location.
When the restricted area is close to a terminal, junction, or another area, the yellow flag may be displayed less than two miles before the restricted area. This information shall be included in the written instructions to employees issued pursuant to paragraph (1).
Yellow-red flags shall be used to warn trains to be prepared to stop because of persons or equipment working. A yellow-red flag shall be displayed two miles before the restricted area in order to ensure that the train is prepared to stop at the proper location.
When the restricted area is close to a terminal, junction, or other area, the yellow-red flag may be displayed less than two miles before the restricted area. This information shall be included in the written instructions to employees issued pursuant to paragraph (1).
Flags shall be displayed only on the track affected and shall be displayed to the right side of the track as viewed from the approaching train. The flags shall be displayed to protect all possible access to the restricted area.
A railroad corporation shall provide milepost markers to train crews at accurate one-mile intervals. The markers shall be readily visible to the locomotive engineer within the locomotive cab, and shall be kept in good repair and replaced when necessary.
A railroad corporation shall place whistle signs to the right of the main track in the direction of approach, exactly one-quarter mile from the entrance to any grade crossing as a point of reference for locomotive engineers who blow the whistle and ring the bell for these grade crossings as a warning to the public. The signs, which shall consist of an “X” or “W” or other identifiable mark or symbol on a square plate mounted on a post, shall be readily visible to a locomotive engineer within the locomotive cab, shall be kept in good repair, and shall be replaced when necessary.
A railroad corporation shall place permanent speed signs to the right of the track in the direction of approach, two miles in advance of the point where the speed is either increased or decreased for both passenger and freight trains. The signs shall be readily visible to a locomotive engineer within the locomotive cab, shall be kept in good repair, and shall be replaced when necessary.
A railroad corporation shall notify the commission and the collective bargaining representative of any affected employee of any new utilization of remote control locomotives in the state, on or after January 1, 2007.
A railroad corporation shall provide immediate notification to the Office of Emergency Services of accidents, incidents, and other events, concurrent with those provided to the Federal Railroad Administration’s National Response Center, as required by Part 225.9 of Title 49 of the Code of Federal Regulations.
Whenever the Department of the California Highway Patrol or a designated local public safety agency responds to a railroad accident, the accident shall be reported to the Office of Emergency Services.
ARTICLE 7.3. Local Community Rail Security Act of 2006 [7665. - 7667.]
This article shall be known, and may be cited, as the Local Community Rail Security Act of 2006.
The Legislature declares that the purpose of this act is to provide for the security and safety of local communities and local community facilities, to protect local communities from transportation practices that fail to secure rail facilities and equipment from the threat of terrorism, and to ensure proper communication between the owners and operators of rail facilities and equipment with local and state first responders.
Unless the context requires otherwise, for purposes of this article:
“Agency” or “office” means the Office of Emergency Services.
“Secretary” or “director” means the Director of Emergency Services.
By July 1, 2007, every operator of rail facilities shall provide a risk assessment to the commission and the office for each rail facility in the state that is under its ownership, operation, or control. The risk assessment shall, for each rail facility, describe all of the following:
The location and functions of the rail facility.
All types of cargo that are moved through, or stored at, the rail facility.
Any hazardous cargo that is moved through, or stored at, the rail facility.
The frequency that any hazardous cargo is moved through, or stored at, the rail facility.
A description of the practices of the rail operator to prevent acts of sabotage, terrorism, or other crimes on the rail facility.
All training programs that the rail operator requires for its employees at the rail facility.
The emergency response procedures of the rail operator to deal with acts of sabotage, terrorism, or other crimes at the rail facility.
The procedures of the rail operator to communicate with local and state law enforcement personnel, emergency personnel, transportation officials, and other first responders, in the event of acts of sabotage, terrorism, or other crimes at the rail facility.
The office may provide the risk assessment provided pursuant to Section 7665.2 to other law enforcement or emergency personnel.
By January 1, 2008, every rail operator shall develop and implement an infrastructure protection program to protect rail infrastructure in the state from acts of sabotage, terrorism, or other crimes.
The infrastructure protection program shall address the security of all critical infrastructure.
The infrastructure protection program shall provide training to all employees of the rail operator performing work at a rail facility on how to recognize, prevent, and respond to acts of sabotage, terrorism, or other crimes.
Each rail operator in the state shall provide to the commission and the director a copy of its infrastructure protection program. Notwithstanding Division 10 (commencing with Section 7920.000) of Title 1 of the Government Code, the commission and the director shall keep this information confidential.
The infrastructure protection program shall be updated by the rail operator at least once every year, and the updated plan shall be submitted to the commission and the director.
The commission, in consultation with the office, shall review the infrastructure protection program submitted by a rail operator, may conduct inspections to facilitate the review, and may order a rail operator to improve, modify, or change its program to comply with the requirements of this article.
The commission may fine a rail operator for failure to comply with the requirements of this section or an order of the commission pursuant to this section.
Every rail operator shall, for all facilities that handle hazardous cargo, do all the following:
Secure all facilities that handle or store hazardous materials by providing adequate security personnel.
Store hazardous materials only in secure facilities designed for storage, which shall not include mainline, branch, industrial, or passing tracks not so designed or retrofitted.
Shall not leave locomotive equipment running while unattended, or leave any unattended locomotive equipment unlocked.
Shall ensure that the cabs of occupied locomotives are secured from hijacking, sabotage, or terrorism.
Shall not use remote control locomotives to move hazardous materials over a public crossing unless the remote control operator is able to maintain line-of-sight visibility of the public crossing and visually ensure that all automatic highway-rail grade crossing warning devices are functioning as intended, and it is safe for the train movement to enter the public crossing.
Shall secure remote control devices to prevent access to those devices by unauthorized personnel.
Every rail operator shall provide communications capability that can accomplish all of the following:
Timely alerting local and state law enforcement personnel, emergency personnel, transportation officials and other first responders in the event of sabotage, terrorism, or other crimes.
Timely provide bridge tenders on moveable bridges the ability to alert local and state law enforcement personnel, emergency personnel, transportation officials and other first responders in the event of sabotage, terrorism, or other crimes.
Notify rail workers of the local or national threat level for the rail industry.
No rail operator or any other person covered by this article may act to punish an employee who reports a violation of this article. An employee against whom a punitive action is taken may seek civil damages of up to one million dollars ($1,000,000) from any employer that acts to punish an employee who reports a violation of this article, in addition to any other remedies the court deems appropriate.
The provisions of this article are severable. If any provision of this article or its application is held invalid, that invalidity shall not affect other provisions or applications that can be given effect without the invalid provision or application.
ARTICLE 7.5. Hazardous Materials Transportation by Rail [7671. - 7673.]
The Legislature finds and declares that the purpose of this article is to protect the health and safety of the public and to improve the safety of transporting hazardous materials by rail.
For purposes of this article, “hazardous material” means either of the following:
A hazardous material, as defined in Section 171.8 of Title 49 of the Code of Federal Regulations.
A hazardous material, as defined in Section 25501 of the Health and Safety Code.
Any railroad corporation which is involved in an incident resulting in a release, or threatened release, of a hazardous material shall immediately report the type and extent of the release or threatened release in the manner specified in Section 25507 of the Health and Safety Code.
Each railroad corporation which transports hazardous materials in the state shall do all of the following:
Provide a system map of the state to the Office of Emergency Services and to the Public Utilities Commission, showing practical groupings of mileposts on the system and showing mileposts of stations, terminals, junction points, road crossings, and the locations of natural gas and liquid pipelines in railroad rights-of-way.
Annually submit to the Office of Emergency Services a copy of a publication which identifies emergency handling guidelines for the surface transportation of hazardous materials, except that if the railroad corporation is classified as a class I carrier by the Interstate Commerce Commission pursuant to Subpart A of Part 1201 of Subchapter C of Chapter X of the Code of Federal Regulations, the railroad corporation shall annually submit to the Office of Emergency Services 50 copies of this publication which the agency shall make available to the Public Utilities Commission and local administering agencies and to other response agencies. These guidelines shall not be considered comprehensive instructions for the handling of any specific incident.
If there is a train incident resulting in a release or an overturned railcar or an impact which threatens a release of a hazardous material, provide the emergency response agency with all of the following information:
A list of each car in the train and the order of the cars.
The contents of each car, if loaded, in the train.
Identification of the cars and contents in the train which are involved in the incident, including, but not limited to, those cars which have derailed.
Emergency handling procedures for each hazardous material transported in or on the involved cars of the train.
ARTICLE 8. Crimes [7676. - 7681.]
Every person who, in making up or running any railroad train, places or runs, or causes to be placed or run, any freight car in the rear of passenger cars, is guilty of a misdemeanor, and if loss of life or limb results from such placing or running, is guilty of a felony. This section shall not apply where railroad trains are carrying only personnel and equipment in connection with military or naval movements. “Freight car,” as used in this section, does not include a baggage, express, or mail car.
This section shall become operative on January 1, 1976.
No person, firm, or corporation operating a railroad with more than four trains each way every 24 hours shall require or permit any engineer, fireman, conductor, brakeman, or trainman to receive, deliver, or transmit at any receiving or forwarding instrument of any telegraph or telephone line, any order for the movement of any train, except in such cases or classes of cases as are permitted by the commission. This section does not apply to interurban or street railroads. Any person, firm, or corporation violating this section is guilty of a misdemeanor.
Radio or other means of communication not hereinabove referred to in Section 7677 may be used for the purpose of transmitting orders for the movement of trains, subject to such rules or regulations as the commission may promulgate for insuring the safety of railroad operations.
Except as provided in paragraphs (1) to (3), inclusive, of subdivision (a) of Section 7604, every person in charge of a locomotive engine who, before crossing any traveled public way, omits to cause a bell to ring or steam whistle, air siren, or air whistle to sound at the distance of at least 1,320 feet from the crossing, and until the lead locomotive has passed through the crossing, is guilty of a misdemeanor.
Any person employed upon any railroad as engineer, conductor, baggage-master, brakeman, switchman, fireman, bridge-tender, flagman, or signalman, or having charge of the regulation or running of trains upon any railroad, in any manner whatever, who either becomes or is intoxicated or who is impaired due to the unlawful use of a controlled substance while engaged in the discharge of his duties, is guilty of a misdemeanor. If any person so employed does any act or neglects any duty, by reason of such intoxication or illegal drug use, which act or neglect causes the death of, or bodily injury to, any person or persons, that person so employed is guilty of a felony.
Every conductor, engineer, brakeman, switchman, or other person having charge, wholly or in part, of any railroad, car, locomotive, or train, who willfully or negligently suffers or causes it to collide with another car, locomotive, or train, or with any other object or thing whereby the death of a human being is produced, is punishable by imprisonment pursuant to subdivision (h) of Section 1170 of the Penal Code for two, three or four years.
Every engineer, conductor, brakeman, switch-tender, or other officer, agent, or servant of any railroad company, who is guilty of any wilful violation or omission of his duty as such officer, agent, or servant, whereby human life or safety is endangered, the punishment of which is not otherwise prescribed, is guilty of a misdemeanor.
ARTICLE 9. Rail Service Assistance [7700. - 7705.]
By Section 803 of the Railroad Revitalization and Regulatory Reform Act of 1976, designated in this chapter as the “act,” Congress has established a local rail service continuation assistance program. Such program is designed to cover: the cost of rail service continuation payments; the cost of purchasing a line of railroad or other rail properties to maintain existing or provide for future rail service; the cost of rehabilitating and improving rail properties on a line of railroad to the extent necessary to permit adequate and efficient rail freight service on such line; and the cost of reducing the costs of lost rail service in a manner less expensive than continuing rail service. The Legislature hereby determines that such program should be implemented in California and that such implementation would constitute a public purpose.
The Department of Transportation, in cooperation with the commission and other affected state and local agencies, shall be responsible for the preparation and periodic update of the state rail plan required by the act.
The Department of Transportation, in cooperation with the commission and other affected state and local agencies, shall perform the duties required by the act in developing, promoting, supervising, and supporting safe, adequate, and efficient rail transportation services; maintaining adequate programs of investigation, research, promotion, and development, with provisions for public participation; and shall take all practicable steps to improve transportation safety and to reduce transportation-related energy utilization and pollution. It is not the intent of this section to diminish in any respect the authority and responsibility of the commission. The department shall work in close cooperation with the commission in carrying out the duties imposed upon it under this chapter.
The Department of Transportation shall administer a program of projects for rail service assistance financed in whole or in part with funds derived pursuant to the act. All necessary matching funds shall be expressly appropriated by the Legislature or donated by public or private entities.
To the maximum extent permitted by federal law, rules, and regulations, the Department of Transportation shall recover the costs of administering this chapter from the federal funds received pursuant to the act.
The Governor, the Secretary of the Business and Transportation Agency, and the Department of Transportation may enter into such agreements, execute such documents, establish and manage such accounts and deposits, act as a recipient, and take any other action that may be appropriate to carry out the rail assistance programs authorized by the act.
ARTICLE 10. Railroad Safety and Emergency Planning and Response [7710. - 7727.]
For purposes of this article, the following definitions shall apply:
“Commission” shall mean the Public Utilities Commission.
“Fund” means the Rail Accident Prevention and Response Fund created pursuant to Section 7713.
“Prevention account” means the Hazardous Spill Prevention Account created, pursuant to Section 7714, in the Railroad Accident Prevention and Response Fund.
“Secretary” means the Secretary of the California Environmental Protection Agency.
The commission shall collect and analyze near-miss data generated from incidents occurring at railroad crossings and along the rail right-of-way. For purposes of this section, “near-miss” includes a runaway train or any other uncontrolled train movement that threatens public health and safety reported to the commission pursuant to Section 7661.
On or before January 1, 1993, the commission shall adopt regulations, based on its findings and not inconsistent with federal law. The commission may amend or revise the regulations as necessary thereafter, to reduce the potential railroad hazards identified in Section 916.2. In adopting the regulations, the commission shall consider at least all of the following:
Establishing special railroad equipment standards for trains operated on railroad sites identified as posing a local safety hazard pursuant to subdivision (b) of Section 916.2. These standards may include, but need not be limited to, standards for all of the following:
Sizes, numbers, and configurations of locomotives.
Brakes.
Establishing special train operating standards for trains operated over railroad sites identified as posing a local safety hazard pursuant to subdivision (b) of Section 916.2. These standards may include, but need not be limited to, standards for all of the following:
Length, weight, and weight distribution of trains.
Speeds and accelerations of trains.
Hours of allowable travel.
Establishing special training, personnel, and performance standards for operators of trains that travel on railroad sites identified as posing a local safety hazard pursuant to subdivision (b) of Section 916.2.
Establishing special inspection and reporting standards for trains operated on railroad sites identified as posing a local safety hazard pursuant to subdivision (b) of Section 916.2.
The Rail Accident Prevention and Response Fund is hereby created in the State Treasury, and the money in the fund is available for appropriation by the Legislature. The secretary shall administer the fund and the prevention account in accordance with this article, and shall develop and adopt regulations and guidelines necessary to carry out and enforce this article.
The State Board of Equalization shall implement the collection of the fee imposed pursuant to Section 7714.5 in accordance with regulations adopted pursuant to Section 7713.
The adoption of regulations pursuant to this section shall be considered by the Office of Administrative Law as an emergency necessary for the immediate preservation of the public peace, health and safety, and general welfare. Notwithstanding Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code, emergency regulations adopted by the secretary and the State Board of Equalization pursuant to this section shall be filed with, but not repealed by, the Office of Administrative Law, and shall remain in effect until revised or repealed by the secretary.
The Hazardous Spill Prevention Account in the Railroad Accident Prevention and Response Fund is hereby created. The moneys deposited in the prevention account shall be subject to annual appropriation in the Budget Act or other appropriation by the Legislature. The amount deposited in the prevention account and available for appropriation shall not exceed three million dollars ($3,000,000) in any calendar year.
The moneys in the prevention account may be expended by the secretary for any of the following purposes:
Creation, support, and maintenance of the Railroad Accident Prevention and Immediate Deployment Force created by subdivision (a) of Section 7718.
Creation, support, maintenance, and implementation of the state railroad accident prevention and immediate deployment plan developed pursuant to subdivision (b) of Section 7718.
Creation, support, and maintenance of programs, data registries, equipment, and facilities to respond to, and contain, toxic releases resulting from surface transportation accidents. Expenditures pursuant to this paragraph may be for the purpose of any of the following:
Acquisition and maintenance of specialized equipment and supplies.
Support of specialized facilities.
Creation and support of a state-level and local toxic emergency response teams to provide immediate onsite response capability in the event of large scale releases of toxic substances resulting from surface transportation accidents.
Support for specialized training for state and local emergency response officials in techniques for prevention of, and response to, toxic releases resulting from surface transportation accidents.
Support for research, data collection, and studies into technologies and techniques for prevention of, response to, and mitigation of, toxic releases resulting from surface transportation accidents.
To provide economic assistance to persons, entities, and communities that suffer direct or indirect economic damages from a surface transportation accident.
In accordance with regulations adopted pursuant to Section 7713, the secretary shall establish a fee schedule, which shall be paid by each surface transporter of hazardous materials in California in an amount sufficient to fund the appropriation from the prevention account and to maintain a prudent reserve of two months’ operating costs, less amounts transferred from the response account pursuant to subdivision (d).
The secretary shall, to the extent practicable, identify programs, equipment, and facilities applicable to specific surface transportation modes, and shall establish fees for each surface transportation mode to cover the costs of the programs, equipment, and facilities applicable to that specific surface transportation mode. Fees to cover the costs of programs, equipment, and facilities applicable to all or several surface transportation modes shall be paid in equal shares by surface transportation modes.
The secretary may authorize payment of fees through contributions in kind of equipment, materials, or services.
For the purposes of the fees authorized by this section, “surface transportation mode” shall not include pipelines subject to the fee assessed pursuant to Section 51019 of the Government Code or any natural gas pipeline.
This section shall become inoperative on December 31, 1995.
The Railroad Accident Prevention and Immediate Deployment Force is hereby created in the California Environmental Protection Agency. The force shall be responsible for providing immediate onsite response capability in the event of large-scale releases of toxic materials resulting from surface transportation accidents and for implementing the state hazardous materials incident prevention and immediate deployment plan. This force shall act cooperatively and in concert with existing local emergency response units. The force shall consist of representatives of all of the following:
Department of Fish and Game.
California Environmental Protection Agency.
State Air Resources Board.
California Integrated Waste Management Board.
California regional water quality control boards.
Department of Toxic Substances Control.
Department of Pesticide Regulation.
Office of Environmental Health Hazard Assessment.
State Department of Public Health.
Department of the California Highway Patrol.
Department of Food and Agriculture.
Department of Forestry and Fire Protection.
Department of Parks and Recreation.
Public Utilities Commission.
Any other potentially affected state, local, or federal agency.
Office of Emergency Services.
The California Environmental Protection Agency shall develop a state railroad accident prevention and immediate deployment plan in cooperation with the State Fire Marshal, affected businesses, and all of the entities listed in paragraphs (1) to (17), inclusive, of subdivision (a).
The plan specified in subdivision (b) shall be a comprehensive set of policies and directions that every potentially affected state agency and business shall follow if there is a railroad accident to minimize the potential damage to the public health and safety, property, and the environment that might result from accidents involving railroad activities in the state.
When an appropriate prosecuting agency determines that any person has engaged in, is engaging in, or is about to engage in, any acts or practices which constitute, or which shall constitute, a violation of any provision of this chapter or of any rule, regulation, permit, covenant, standard, requirement, or order issued, promulgated, or executed pursuant to this chapter, the city attorney or district attorney of the jurisdiction in which these acts or practices have occurred, are occurring, or shall occur, or the Attorney General, may make application to the superior court or to the commission for an order enjoining these acts or practices or an order directing compliance with this chapter.
A temporary restraining order, preliminary or permanent injunction, or other order may be issued under this subdivision upon a showing that any person has engaged in, is engaging in, or is about to engage in, the acts or practices set forth in paragraph (1).
Notwithstanding any other provision of law, in any civil action brought pursuant to this chapter in which a temporary restraining order, or preliminary or permanent injunction is sought, it shall not be necessary for the moving party to allege or prove either of the factors set forth in paragraphs (1) and (2) at any stage of the proceeding. The temporary restraining order or preliminary or permanent injunction may issue without allegations or proof of either of the following factors:
That irreparable damage shall occur should the relief sought not be granted.
That the remedy at law is inadequate.
Every civil action commenced pursuant to this article for civil or criminal penalties authorized by this article shall be brought by the city attorney, the district attorney, or the Attorney General in the name of the people of the State of California, and any actions relating to the same event, transaction, or occurrence may be joined or consolidated, or may be coordinated pursuant to Section 404 of the Code of Civil Procedure or Division II (commencing with Rule 1501) of Title Four of the California Rules of Court.
Any civil action brought in the superior court pursuant to this article shall be brought in the county in which the spill, discharge, or violation occurred, the county in which the principal place of business of the defendant is located, or the county in which the defendant is doing business in this state.
The civil and criminal penalties provided in this article are separate and in addition to, and do not supersede or limit, any other civil or criminal remedy.
Any person who commits any of the following acts, shall, upon conviction, be punished by imprisonment in the county jail for not more than one year or by imprisonment pursuant to subdivision (h) of Section 1170 of the Penal Code for 16, 24, or 36 months:
Except as provided by Section 7724.1, knowingly fails to follow the direction or order of the secretary or the commission arising from a rail accident or release of a hazardous or potentially hazardous commodity from a railcar.
Knowingly causes, or aids or abets in, the discharge or spill of, a hazardous or potentially hazardous commodity from a railcar, unless the discharge is authorized by the United States, the state, or another agency with appropriate jurisdiction.
Knowingly fails to comply with the regulations adopted pursuant to Section 7712, and that failure results in a rail accident or release of hazardous material or creates a significant risk of accident or release of hazardous material.
The court shall also impose upon a person convicted of violating subdivision (a), a fine not to exceed five hundred thousand dollars ($500,000) for each violation. For purposes of this subdivision, each day or partial day that a violation occurs is a separate violation.
The court shall also impose upon a person convicted of violating paragraph (1) of subdivision (a), a fine equal to twice the cost of abating, repairing, and responding to the cost associated with the illegal discharge of a hazardous or potentially hazardous commodity from a railcar as a result of a rail accident.
If a person reasonably, and in good faith, believes that the directions or orders given by the secretary or the commission would substantially endanger the public safety or the environment, the person may refuse to act in compliance with the orders or directions of the secretary or the commission. The person shall state, at the time of the refusal, the reasons why the person refuses to follow the orders or directions of the secretary or the commission. The person shall give the secretary or the commission written notice of the reasons for the refusal within 48 hours of refusing to follow the orders or directions of the secretary or the commission.
In any civil or criminal proceeding commenced pursuant to Section 7724, the burden of proof shall be on the responsible party or potentially responsible party to demonstrate, by clear and convincing evidence, why the refusal to follow the orders or directions of the secretary or the commission was justified under the circumstances.
Any person who commits any of the acts set forth in paragraphs (1) to (3), inclusive, shall be liable for a civil penalty not to exceed one hundred thousand dollars ($100,000) for each violation of a separate provision or, for a continuing violation, for each day that violation occurs:
Negligent failure to follow the direction or order of the secretary in connection with a rail accident or the release of a hazardous commodity from a railcar.
Knowingly engaging in, or causing the discharge or spill of a hazardous commodity from a railcar or highway carrier, unless that discharge is authorized by the United States, by the state, or by another governmental agency with appropriate jurisdiction.
Negligent failure to comply with any regulation adopted pursuant to Section 7712.
Any person who commits any of the acts set forth in paragraphs (1) to (3), inclusive, shall be liable for a civil penalty not to exceed twenty-five thousand dollars ($25,000) for each violation of a separate provision or, for a continuing violation, for each day that violation occurs:
Failure to follow the direction or order of the secretary in connection with a rail accident or the release of a hazardous commodity from a railcar.
Engaging in, or causing the discharge or spill of a hazardous commodity from a railcar or highway carrier, unless that discharge is authorized by the United States, by the state, or by another governmental agency with appropriate jurisdiction.
Failure to comply with any regulation adopted pursuant to Section 7712.
Twenty-five percent of penalties and fines collected pursuant to any action brought under Sections 7724 and 7724.5 shall be paid to the governmental agency or office which prosecutes the action. The remainder of the penalties and fines collected pursuant to this article shall be deposited into the fund.
When the secretary or the commission determines that any person has engaged in, is engaged in, or threatens to engage in, any practice or act which constitutes a violation of this article, or any regulation or order issued, adopted, or executed pursuant to this article, the secretary or commission may issue an order requiring that person to cease and desist.
Any cease and desist order issued by the secretary or commission may be subject to such terms and conditions as the secretary or commission may determine are necessary to ensure compliance with this article.
Any cease and desist order issued by the secretary or commission shall become null and void 90 days after issuance.
A cease and desist order issued by the secretary or commission shall be effective upon the issuance thereof, and copies shall be served immediately by certified mail upon the person or governmental agency being charged with the actual or threatened violation.
The commission may authorize its executive director to exercise the commission’s authority to issue cease and desist orders pursuant to this section.
Notwithstanding any other provision of law, this chapter shall not be construed to make a reference to the California Environmental Protection Agency for the purposes of compliance with Provision 2 of Item 3400-002-044 of Section 2. 00 of the Budget Act of 1991.
CHAPTER 2. Street Railroads [7801. - 7818.]
Street railroads are governed by Chapter 1 (commencing with Section 7501), so far as it is applicable, unless street railroads are therein specially excepted.
When a street railroad is constructed, owned, or operated by any natural person, this chapter is applicable to such person in like manner as it is applicable to corporations.
Any street railroad or any street railway corporation may sell, lease, convey, exchange, transfer, or otherwise dispose of all or substantially all of its property and assets, including franchises, under authority of a resolution of its board of directors and with the approval of the principal terms of the transaction and the nature and the amount of the consideration by a vote or written consent of shareholders entitled to exercise a majority of the voting power of the corporation when the sale, lease, conveyance, exchange or transfer of its properties is made to a municipal corporation or any other political subdivision within the State.
Authority to lay railroad tracks through the streets and public highways of any city or city and county may be obtained for a term of years not exceeding 50, from the governing body of the city or city and county, under such restrictions and limitations, and upon such terms and payment of license tax, as the governing body may provide. Permission shall not be granted to propel cars upon such tracks otherwise than by electricity or by wire ropes running under the streets and moved by stationary engines except as provided in Section 7813. The governing body in granting the right, or at any time after the right is granted, may impose such terms, restrictions, and limitations as to the use of streets and the construction and mode of operating the road as it deems to be for the public safety or welfare.
The city governing body, in granting the right of way to a street railroad corporation, in addition to the restrictions which they are authorized to impose, shall require a strict compliance with the following conditions, except in the cases of prismoidal or other elevated railways:
The railway shall be constructed in such manner as will present the least obstruction to the freedom of the streets on which it is erected.
The tracks shall not be more than five feet wide within the rails, and shall have a space between them sufficient to allow the cars to pass each other freely.
The legislative body of any city or city and county may permit two or more lines of street railway to use the same portion of the same street or the same tracks upon such terms as are agreed upon by the companies operating the railways, but no permission shall be granted to one company to use the same tracks or portions of the same street for more than five consecutive blocks, without the consent of the person or company occupying that portion of the street and then only upon payment of an equal portion of the cost of construction of the tracks and appurtenances used by the railways jointly.
Where the portion of the street is occupied by a track or tracks of a different gauge from the track or tracks proposed to be constructed thereon by a line of street railway under a different management, the latter street railway may nevertheless construct its track or tracks, subject to the provisions of Section 7806, over the same ground as is occupied by the prior track or tracks, if they can be so constructed as not to interfere with the operation of the prior track or tracks beyond such necessary interference therewith as is incident to such construction with reasonable skill, care, and diligence.
Any city or city and county may own and operate street railways within or without its corporate limits and may occupy the same street or tracks occupied or used by any street railway within its limits for any number of blocks, upon payment to the owner thereof of an equal portion of the estimated cost of construction, at the time of such occupation, of such tracks or appurtenances as the city or city and county elects to use jointly with the street railway.
Any proposed railroad track may be permitted to cross any track already constructed, the crossing being made as provided in Chapter 1 of this division. In laying down the track and preparing therefor, not more than one block shall be obstructed at any one time, nor for a longer period than 10 working days.
Street railway cars shall be of the most approved construction for the comfort and convenience of passengers, and provided with brakes to stop them, when required. A violation of this section subjects the corporation to a fine of two hundred dollars ($200) for each offense.
Cities in or through which street railroads run may make such further regulations for the government of the street railroads as may be necessary to a full enjoyment of the franchise and the enforcement of the conditions provided herein.
In every grant to construct street railroads, the right to grade, sewer, pave, macadamize, or otherwise improve, alter, or repair the streets or highways, is reserved to the city and cannot be alienated or impaired. The work shall be done so as to obstruct the railroad as little as possible, and if required, the street railway corporation shall shift its rails so as to avoid the obstructions made thereby.
The right to lay down a track for grading purposes and to maintain it for a period not to exceed three years may be granted by the governing body of any city, city and county, or county, but no such track shall remain more than three years upon any one street. The track shall be laid level with the street, and shall be operated under such restrictions as not to interfere with the use of the street by the public. The governing body may grant the right to use steam or any other motive power in propelling the cars used on the grading track, when public convenience or utility demands it, but the reasons therefor shall be set forth in the ordinance, and the right to rescind the ordinance at any time reserved.
Any corporation, or agent or employee thereof, demanding or charging a greater sum of money for fare on the cars of a street railroad than that fixed by law forfeits to the person from whom the sum is received, or who is thus overcharged, the sum of two hundred dollars ($200), to be recovered in a civil action against the corporation.
Every street railroad corporation shall provide, and on request furnish to all persons desiring a passage on its cars, any required quantity of passenger tickets or checks, each to be good for one ride. Any corporation failing to provide and furnish tickets or checks to any person desiring to purchase them at the prescribed rate shall forfeit to such person the sum of two hundred dollars ($200), to be recovered as provided in Section 7814. The provisions of this section shall not apply to such street railroad corporations as charge but five cents ($0.05) fare.
Upon the trial of an action for any of the sums forfeited, as provided in Sections 7814 or 7815, proof that the person demanding or receiving the money as fare, or for the sale of the ticket or check, was at the time of making the demand or receiving the money, engaged in an office of the corporation, or vehicle belonging to the corporation, shall be prima facie evidence that such person was the agent, servant, or employee of the corporation, to receive the money, and give the ticket or check mentioned.
Any street railroad corporation operating cars on the streets of cities or on the county roads within the State for the conveyance of passengers, propelled by means of wire ropes attached to stationary engines, or by electricity or compressed air, who runs, operates, or uses any car or dummy, unless each car and dummy, while in use, is fitted with a brake capable of bringing the car to a stop within a reasonable distance, and a suitable fender, or appliance placed in front or attached to the trucks of the dummy, or car, for the purpose of removing and clearing obstructions from the track, and preventing any obstacles, obstructions, or person on the track from getting under the dummy or car, and removing the same out of danger, and out of the way of the dummy or car, is guilty of a misdemeanor. Where the commission prescribes the fender or brake to be used, a compliance therewith constitutes a full compliance with this section.
Any person operating or driving a street car who becomes or is intoxicated while so engaged in operating or driving such street car is guilty of a misdemeanor.
CHAPTER 3. Telegraph or Telephone Corporations [7901. - 7912.]
Telegraph or telephone corporations may construct lines of telegraph or telephone lines along and upon any public road or highway, along or across any of the waters or lands within this State, and may erect poles, posts, piers, or abutments for supporting the insulators, wires, and other necessary fixtures of their lines, in such manner and at such points as not to incommode the public use of the road or highway or interrupt the navigation of the waters.
It is the intent of the Legislature, consistent with Section 7901, that municipalities shall have the right to exercise reasonable control as to the time, place, and manner in which roads, highways, and waterways are accessed.
The control, to be reasonable, shall, at a minimum, be applied to all entities in an equivalent manner.
Nothing in this section shall add to or subtract from any existing authority with respect to the imposition of fees by municipalities.
Every agent, operator, or employee of any telegraph or telephone office, who in any way uses or appropriates any information derived by him from any private message passing through his hands, and addressed to any other person, or in any other manner acquired by him by reason of his trust as such agent, operator, or employee, or trades or speculates upon any such information so obtained, or in any manner turns, or attempts to turn, the information so obtained to his own account, profit, or advantage, is punishable by imprisonment pursuant to subdivision (h) of Section 1170 of the Penal Code, or by imprisonment in a county jail not exceeding one year, or by fine not exceeding ten thousand dollars ($10,000), or by both that fine and imprisonment.
Every agent, operator, or employee of any telegraph or telephone office, who wilfully refuses or neglects to send any message received at such office for transmission, or wilfully postpones the transmission of the message out of its order, or wilfully refuses or neglects to deliver any message received by telegraph or telephone, is guilty of a misdemeanor. Nothing in this section shall be construed to require any message to be received, transmitted or delivered, unless the charges thereon have been paid or tendered, nor to require the sending, receiving, or delivery of any message counseling, aiding, abetting, or encouraging treason against the Government of the United States or of this State, or other resistance to the lawful authority, or any message calculated to further any fraudulent plan or purpose, or to instigate or encourage the perpetration of any unlawful act, or to facilitate the escape of any criminal or person accused of crime.
The Public Utilities Commission shall issue regulations requiring every telephone corporation subject to its jurisdiction to maintain complete records of all instances in which its employees discover any device installed for the purpose of overhearing communications over the lines of such corporation and all instances in which such employees reasonably believe and report to the corporation their belief that such device is installed or has been installed but has since been removed.
The Public Utilities Commission shall regularly make inquiry of every telephone corporation under its jurisdiction to determine whether or not such corporation is taking adequate steps to insure the privacy of communications over such corporation’s telephone communication system.
A background check equivalent to that performed by the contracting telephone corporation, a holder of a state franchise pursuant to Division 2.5 (commencing with Section 5800), and a video provider, as defined in Section 53088.1 of the Government Code, shall also be conducted on all of the following:
Persons hired by a contracting entity under a personal services contract.
Independent contractors and their employees.
Vendors and their employees.
Independent contractors and vendors shall certify that they have obtained the background checks required pursuant to subdivision (b), and shall make the background checks available to the contracting entity upon request.
Except as otherwise provided by contract, the telephone corporation, a holder of a state franchise pursuant to Division 2.5 (commencing with Section 5800), and a video provider, as defined in Section 53088.1 of the Government Code, shall not be responsible for administering the background checks and shall not assume the cost of the background checks of individuals who are not applicants for employment of the contracting entity.
An individual shall not, on behalf of a telephone corporation, holder of a state franchise pursuant to Division 2.5 (commencing with Section 5800), or video provider, as defined in Section 53088.1 of the Government Code, enter upon the premises of any individual unless he or she has had the background check required by subdivisions (a) and (b).
Subdivision (a) applies to applicants for employment for positions that would allow the applicant to have direct contact with or access to the company’s network or central office and would require the applicant to perform activities that involve the installation, service, or repair of the company’s network or equipment.
Subdivision (b) applies to any person that has direct contact with or access to the company’s network or central office and performs activities that involve the installation, service, or repair of the company’s network or equipment.
This section does not apply to temporary workers performing emergency functions to restore the network of a telephone corporation to its normal state in the event of a natural disaster or an emergency that threatens or results in the loss of service.
The provisions of this section apply only to applicants for employment who apply for employment on and after January 1, 2009, and to contracts entered into on or after January 1, 2009.
A public utility employing more than 750 total employees shall annually report to the commission all of the following:
The number of customers served in California by the public utility.
The percentage of the public utility’s total domestic customer base that resides in California.
The number of California residents employed by the public utility, calculated on a full-time or full-time equivalent basis.
The percentage of the public utility’s total domestic workforce, calculated on a full-time or full-time equivalent basis, that resides in California.
The capital investment in the public utility’s tangible and intangible plant which ordinarily have a service life of more than one year, including plant used by the company or others in providing public utility services, in California during the yearly reporting period.
The number of California residents employed by independent contractors and consultants hired by the public utility, calculated on a full-time or full-time equivalent basis, when the public utility has obtained this information upon requesting it from the independent contractor or consultant, and the public utility is not contractually prohibited from disclosing the information to the public. This subdivision is inapplicable to contractors and consultants that are a public utility subject to the reporting requirements of this section. This paragraph applies only to those employees of an independent contractor or consultant that are personally providing services to the public utility, and does not apply to employees of an independent contractor or consultant not personally performing services for the public utility.
CHAPTER 3.5. New Area Codes [7930. - 7943.]
The Legislature finds and declares all of the following:
The explosive demand for new area codes in California requires more area codes to be established than was envisioned when this chapter and Section 2887 were enacted in 1990.
Because of the advent of competition in the local telecommunications market, and a decision by the Federal Communications Commission, new area codes are established by the North American Numbering Plan Administrator in conjunction with the commission and members of the telecommunications industry.
In order to eliminate potential confusion for all the parties involved in the process of establishing new area codes, the changes to this chapter enacted in the 1997–98 Regular Session include identifying “providers” in Section 7931.
The “providers” specified in Section 7931 include telephone corporations and resellers that are regulated by the commission, and paging companies that are not regulated by the commission. It is necessary to include all of these entities within the term “providers” in order to effectively meet the needs of the state as they relate to the establishment of new area codes. The Legislature does not, however, by including paging companies as “providers” in Section 7931, intend to expand the jurisdiction of the commission over paging companies beyond the requirements of this chapter. The Legislature continues to recognize the status of paging companies as unregulated entities.
This chapter is applicable to telephone corporations, including resellers, and to paging companies, hereafter referred to as providers.
For purposes of this chapter, “coordinator” means the “coordinator for California area code relief” as designated by the North American Numbering Council.
Whenever the coordinator and providers evaluate the potential boundaries of a new area code, they shall consider rate area boundaries, municipal boundaries, communities of interest, and other appropriate criteria.
When the coordinator determines the need to establish a new area code, at least 30 months prior to the projected opening of the new area code, the coordinator shall provide written notice to the commission regarding the need to establish the new area code.
From the date the written notice required by subdivision (d) is received by the commission all of the following shall be done:
Within three months all providers shall notify all affected customers in writing of the need to establish a new area code. Nothing in this paragraph requires a customer to receive in one bill more than one notice for each billed number.
Within nine months the coordinator and the commission staff shall notify representatives of local jurisdictions and the public in affected geographic areas, and, at the discretion of the commission, may conduct one or more meetings both for representatives of local jurisdictions and for members of the public in affected geographic areas to inform them of the proposed area code relief options and of measures that may be taken to mitigate any potential disruptions, and to afford them the opportunity to discuss the potential impact of the proposed options.
Within 11 months the coordinator shall file the results of the area code relief planning process with the commission requesting commission approval to implement a plan. Anyone may contest the results of the area code planning process by filing a written protest with the commission not later than 60 days after the results have been filed with the commission.
Unless the commission determines otherwise, at least 12 months prior to the date adopted by the commission for opening the new area code, all of the following shall be done:
The coordinator shall notify the general public of the specific geographic area to be included in both the old and new area codes. The notice shall include the schedule for any transitional dialing periods required by Section 7932.
Each telephone provider serving the specific geographic area included in the existing area code shall give written notice to all its affected customers about the specific geographic area that will be included in the new area code. The notice shall include the schedule for any transitional dialing periods required by Section 7932, and the prefixes that will be contained in the new area code. Nothing in this paragraph requires a customer to receive in one bill more than one notice for each billed telephone number.
Within three months prior to the adopted date for opening the new area code, each provider serving the existing area code shall give written notice to its affected customers of the specific geographic boundaries of the new area code. The notice shall include the schedule for any transitional periods required by Section 7932, and the prefixes that will be contained in the new area code. Nothing in this paragraph requires a customer to receive in one bill more than one notice for each billed number.
Whenever a provider opens a new area code, it shall do all of the following:
If the new area code plan permits seven-digit dialing, provide for a transitional dialing period during which a number in the new area code, or a number in the existing area code, may be reached by dialing either the seven-digit called number, or the area code plus the seven-digit called number.
Subsequent to the transitional dialing period provided in paragraph (1), if prefix codes are available, permit callers to reach a recorded announcement, without charge, that will inform the caller of the new area code when the existing area code is dialed.
If the new area code plan requires 10-digit dialing within an area code, provide for any transitional dialing period or recorded announcements the commission may order.
Paragraphs (1) and (2) of subdivision (a) shall no longer be operative if an authorized federal or state agency orders mandatory 10-digit dialing.
The rate structure of any call originating in or made to an area code shall not change with the split of an area code into two or more area codes, regardless of the number of digits dialed.
The Legislature finds and declares all of the following:
The number of area codes in this state has more than doubled since 1991.
The proliferation of area codes has caused undue hardship on citizens of this state, who have begun to be forced into new area codes after years of having the same telephone number.
That proliferation has substantially increased costs to businesses, individuals, and government agencies.
New area codes require the replacement of business cards and letterhead stationery, and companies must use employee time contacting their customers to ensure that those customers are able to continue to reach the affected company.
The proliferation of area codes has also reduced worker productivity as employees begin using new and unfamiliar area codes.
It is the policy of the Legislature that existing area codes should be preserved for as long as possible.
It is the further policy of the Legislature that the hardship currently experienced by telecommunications customers as a result of the creation of new area codes should be alleviated.
For all of the reasons stated above, it is necessary for the commission, as a public agency, to take all possible measures to protect area codes as a public resource, stop area code proliferation, and review their existing practice of establishing new area code regions and the creation of area code overlays.
The commission shall develop and implement any measures it determines to be available for telephone corporations that possess prefixes to efficiently allocate telephone numbers within those prefixes. The commission shall consider the cost effectiveness of these measures before requiring implementation. Among the measures the commission shall consider are rate center consolidation, allocation of numbers in blocks smaller than 10,000, and unassigned number porting.
For the purpose of this section, in accordance with the North American Numbering Plan, a telephone number consists of a three digit area code or number plan area (NPA), a three digit prefix or NXX code, and a four digit line number.
The commission shall direct the North American Numbering Plan Administrator to obtain utilization data for any area code for which a relief plan is proposed, prior to adopting a plan for, or setting a date for, relief.
The commission shall require, as an interim measure until the commission develops procedures for number pooling or adopts utilization standards, that number assignments made by telephone corporations to their customers shall be made first from prefixes that are more than 25 percent in use. A telephone corporation may assign numbers from prefixes with less than 25 percent use only to the extent necessary, if numbers from prefixes that are more than 25 percent in use are not otherwise available.
If the commission or an authorized federal agency establishes a process to ensure that telephone numbers can be allocated in blocks smaller than 10,000, the commission shall require that a telephone corporation return to the North American Numbering Plan Administrator blocks of telephone numbers for reassignment, in a quantity determined by the commission.
The commission shall direct the North American Numbering Plan Administrator to seek the return of blocks of numbers smaller than 10,000 not in use. The commission, for purposes of this section, shall define “not in use.”
A telephone corporation doing business in this state that possesses one or more telephone number prefixes, or portions thereof, shall provide to the commission or its agent, upon request, use information pertaining to both those prefixes in use and those prefixes not in use, according to any schedule established by the commission.
It is the intent of the Legislature that when the commission has no reasonable alternative other than to create a new area code, that the commission do so in a way that creates the least inconvenience for customers.
The commission shall request that the Federal Communications Commission grant authority for the commission to order telephone corporations to assign telephone numbers dedicated to mobile telephony service and mobile data service, as defined in Section 224.4, to a separate area code and to permit seven digit dialing within that technology-specific area code and the underlying preexisting area code or codes.
Before approving any new area code, the commission shall first perform a telephone utilization study and implement all reasonable telephone number conservation measures.
If the commission receives the grant of authority set forth in subdivision (b) and determines that further area code relief is needed, the commission shall exercise the authority granted to it in subdivision (b) unless it finds at least one of the following:
Exercising the authority granted by subdivision (b) would be more disruptive to the customers where area code relief has been determined to be necessary.
Exercising the authority granted by subdivision (b) will not adequately extend the life of the area code where relief has been determined to be necessary.
The commission may not implement any authority granted by the Federal Communications Commission pursuant to subdivision (b), in a manner that impairs the ability of a customer to have number portability.
CHAPTER 4. Injury to Public Utility Property [7951. - 7953.]
Any person who wilfully and maliciously does any injury to telegraph or telephone or electric power or gas property is liable to the corporation for three times the amount of actual damages sustained thereby, to be recovered in any court of competent jurisdiction.
Any person who injures or destroys, through want of proper care, any necessary or useful facility or equipment of any telegraph, telephone, electrical, or gas corporation, is liable to the corporation for all damages sustained thereby. The measure of damages to the facility or equipment injured or destroyed shall be the cost to repair or replace the property injured or destroyed including direct and allocated costs for labor, materials, supervision, supplies, tools, taxes, transportation, administrative and general expense and other indirect or overhead expenses, less credit, if any, for salvage, as determined by such telegraph, telephone, electrical or gas corporations in conformity with a system of accounts established by the commission. The specifying of the measure of damages for the facility or equipment shall not preclude the recovery of such other damages occasioned thereby as may be authorized by law.
Any vessel which, by dragging its anchor, or otherwise, breaks, injures or destroys any underwater cable of a telegraph, telephone or electrical corporation or pipeline of a gas corporation, subjects its owner to liability for the damages sustained thereby.
No telegraph, telephone, electrical or gas corporation can recover damages for the breaking, injury or destruction of any underwater cable or gas pipeline, unless the corporation has previously placed a marker on the bank of the waters under which the cable or pipeline is placed, indicating the place where the cable or pipeline lies.
CHAPTER 5. Electrical Line Construction [8001. - 8057.]
ARTICLE 1. Definitions [8001. - 8003.]
Unless the particular provisions or the context otherwise requires, the definitions and general provisions contained in this article shall govern the construction of this chapter.
“Person” includes any commission, officer, agent, or employee of this State, or of any county, city, city and county, or other political subdivision thereof, and any other person, firm, or corporation.
“Signal wires or cables” include telephone, telegraph, and other signal wires.
ARTICLE 2. Surface Transmission [8026. - 8038.]
No person shall run, place, erect, or maintain any wire or cable used to conduct electricity, on any pole, or any crossarm, bracket, or other appliance attached to such pole, within a distance of 13 inches from the center line of the pole.
This section does not apply to signal wires or cables which are attached to a pole to which is attached no wire or cable other than signal wires or cables, except within the corporate limits of a city, nor shall this section apply to such wires or cables where they are placed vertically on poles, nor to bridle or jumper wires on any pole which are attached to signal wires on the same pole, nor to any aerial cable, as between such cable and any pole on which it originates or terminates.
Telephone toll lines may be exempt from the provisions of this section if proper evidence introduced before the commission proves to the satisfaction of the commission, that compliance would seriously interfere with long distance telephone transmission.
This section does not apply to wires run from lead wires to arc or incandescent lamps nor to transformers placed upon poles, nor to any wire or cable where it is attached to the top of a pole, as between it and the pole, nor to any aerial cable containing signal wires where the cable is attached to a pole on which no other wires or cables than wires continuing from the cable are maintained if electric light or power wires or cables are not maintained on the same side of the street or highway on which the aerial cable is placed.
No person shall run, place, erect, or maintain in the vicinity of any pole (and unattached thereto) within the distance of 13 inches from the center line of the pole, any wire or cable used to conduct electricity, or place, erect or maintain any pole (to which is attached any wire or cable used to conduct electricity) within the distance of 13 inches (measured from the center of such pole) from any wire or cable used to conduct or carry electricity. As between any wire or cable and any pole, only the wire, cable, or pole last in point of time run, placed, or erected, shall be held to be run, placed, erected, or maintained in violation of the provisions of this section.
This section does not apply to signal wires, or cables on poles to which are attached no other wires, as between such wires and poles to which are attached no other wires or cables than signal wires if such wires, cables, and poles are not within the corporate limits of a city.
Telephone toll lines may be exempt from this section if proper evidence introduced before the commission proves to the satisfaction of the commission, that compliance would seriously interfere with long distance telephone transmission.
No person shall run, place, erect, or maintain, above ground, within four feet from any wire or cable conducting less than 600 volts of electricity, any wire or cable which conducts at any one time more than 600 volts of electricity, or run, place, erect, or maintain within four feet from any wire or cable which conducts at any one time more than 600 volts of electricity any wire or cable conducting or carrying less than 600 volts of electricity.
This section does not apply to wires or cables attached to a transformer, arc or incandescent lamp within four feet (measured along the line of the wire or cable) from the point where such wire or cable is attached to such transformer, arc or incandescent lamp, nor to wires or cables within buildings or other structures, nor to wires or cables where they are placed vertically on poles, or to any lead wires or cables between the points where they are made to leave any pole for the purpose of entering any building or other structure and the point at which they are made to enter such building or structure.
As between any two wires or cables, or any wire or any cable, run, placed, erected, or maintained in violation of this section, only the wire or cable last in point of time run, placed, or erected shall be held to be run, placed, erected, or maintained thus in violation of this section.
Where no more than one crossarm is maintained on a pole, all the wires or cables conducting at any one time more than 600 volts of electricity shall be placed on the crossarm on one side of the pole, and all the wires or cables conducting less than 600 volts of electricity shall be placed on the crossarm on the other side of the pole. The space between any wire or cable conducting at any one time more than 600 volts of electricity and any wire or cable conducting less than that voltage shall be at least 36 inches clear measurement in a horizontal line.
Where the provisions of this section cannot be complied with, the commission may grant permission for the following form of construction; where two or more systems for the distribution of electric light or power occupy the same poles with wires or cables, all wires or cables conducting at any one time more than 600 volts of electricity may be placed on the crossarms on one side of the pole, and all wires or cables conducting less than that voltage, shall in such case, be placed on the crossarms on the other side of the pole; the space between any wire or cable conducting at any one time more than 600 volts of electricity and any wire or cable conducting or carrying less than that voltage shall be at least 36 inches in measurement in a horizontal line; and in such construction all crossarms shall be at least 36 inches apart in a vertical line.
No person shall run, place, erect, or maintain any wire or cable which conducts at any one time more than 600 volts of electricity, without causing each crossarm, or such other appliance as is used in lieu thereof, to which such wire or cable is attached to be kept at all times painted a bright yellow color, or, on such crossarm, or other appliance used in lieu thereof, shall be placed signs, providing, in white letters on a green background, not less than three (3) inches in height the words “high voltage” on the face and back of each crossarm. The provisions of this section do not apply to crossarms to which are attached wires or cables conducting more than 10,000 volts of electricity, and which are situated outside the corporate limits of a city.
No person shall place, erect, or maintain on any pole any transformer, capacitor, or other electrical device containing polychlorinated biphenyls for transforming electric current, when the pole or transformer is required to be marked pursuant to applicable regulations of the United States Environmental Protection Agency, unless the person owning or controlling the pole on which the device is situated, upon request of any fire protection agency within the person’s electrical service area, either marks the pole with a reflective band specified by the fire protection agency or furnishes to the fire protection agency the location of every pole within the fire protection agency on which such a device is located, at the person’s option.
No person shall run, place, erect, or maintain any guy wire or guy cable attached to any pole or appliance to which is attached any wire or cable used to conduct electricity, without causing the guy wire or guy cable to be effectively insulated at all times at a distance of not less than four (4) feet nor more than eight (8) feet (measured along the line of the wire or cable) from the upper end thereof, and at a point not less than eight (8) feet vertically above the ground from the lower end thereof. Where two or more guy wires or guy cables are attached to the same pole and same anchorage pole there shall be at least one foot, vertical space, between the points of attachment. No insulation shall be required at the lower end of a guy wire or guy cable where it is attached to a grounded anchor. Where guy wires or guy cables are attached to a pole or structure of steel or other conducting material supporting wires or cables conducting in excess of 15,000 volts where the pole or structure is thoroughly grounded no insulation shall be required at any point in the guy wire or guy cable.
This section does not apply to guy wires or guy cables attached to poles carrying no wire or cable other than signal wires or cables and which are situated outside the corporate limits of a city.
No person shall run, place, erect, or maintain vertically on any pole any wire or cable used to conduct electricity, without causing such wire or cable to be at all times wholly incased in a casing equal in durability and insulating efficiency to a wooded casing not less than one and one-half inches thick.
This section does not apply to vertical signal wires or cables on poles where no other such wires or cables are maintained, and which are outside the corporate limits of a city, nor to wires or cables run vertically on iron poles or structures where both pole or structure and conduit are securely grounded.
No person shall place, erect, or maintain on any pole, or any crossarm or other appliance on the pole, which carries or upon which is placed an electric arc lamp, any transformer for transforming electric currents. This section shall not apply if the arc lamp is suspended so that it can be trimmed from the ground or from a stand located on the pole not less than seven feet below the transformer, and in so suspending the arc lamp no wire or cable in connection therewith is run vertically on the pole unless the wire or cable is protected as provided for in Section 8031.
No person shall run, place, erect, or maintain any wire or cable carrying more than 15,000 volts of electricity across any wire or cable carrying less than that voltage or across any public highway, except on a pole of such height and so placed at each crossing that under no circumstances can the wire or cable of a voltage higher than 15,000 volts in case of breakage thereof or otherwise, come in contact with any wire or cable of less than that voltage, or fall within a distance of ten (10) feet from the surface of any public highway; or in lieu thereof double strength construction may be installed, in which case the wires carrying a voltage higher than 15,000 volts shall, between the points of crossing, be of a cross-section area equal to at least twice that used in the line outside of such crossing, except where the conductor used is equal to number four (4) stranded Brown and Sharpe gauge or greater, in which case the wires or cables will be considered as complying with the law.
No person shall run, place, erect, or maintain any suspension wire to which is attached any aerial cable of 75 pair No. 19 Brown and Sharpe gauge or over, or of 100 pair No. 22 Brown and Sharpe gauge or over suspended from a crossarm, or from any other structure or appliance from which the suspension wire is hung, by a single bolt and clamp without at the same time attaching the suspension wire to the crossarms, structure, or appliance by an additional safety bolt and clamp, or other safety appliance for thus attaching the suspension wire of tensile strength equal to the first bolt and clamp.
None of the provisions of Sections 8026 to 8034, inclusive, apply to direct current electric wires or cables having the same polarity, nor to signal wires when no more than two (2) of such signal wires are attached to any one pole, but no such direct current or signal wires shall in any case be run, placed, erected, or maintained within the distance of thirteen (13) inches from the center line of any pole other than the pole or poles on which the wires or cables are carried, carrying electric wires or cables. As between any two wires, or cables, or any wire or cable run, placed, erected, or maintained in violation of this section, only the wire or cable last in point of time run, placed, erected, or maintained shall be held to be run, placed, erected, or maintained thus in violation of this section.
No person shall run, place, erect, or maintain any span wire attached to any wire or cable used to conduct electricity, without causing the span wire to be at all times effectively insulated between the outer point at which it is in any case fastened to the pole or other structure by which it is hung or supported, and at the point at which it is in any case thus attached. Such insulation shall not in any case be placed less than two (2) feet or more than four (4) feet from the point at which the span wire is so attached. When in any case such span wire is attached along its length to any two (2) such wires or cables, conducting electricity and extending parallel to each other, not more than eighteen (18) feet apart, such insulation shall not be required therein at any point between such parallel wires or cables. This section does not apply where feeder wires are used in place of span wires.
The commission may grant such additional time and shall inspect all work which is included in the provisions of this article, and may make such further additions or changes as the commission deems necessary for the purpose of safety to employees and the general public. The commission shall enforce the provisions of this article.
Any violation of any provision of this article is a misdemeanor.
ARTICLE 3. Underground Transmission [8051. - 8057.]
No person shall build or rebuild any subway, manhole, chamber, or underground room used or to be used to contain, encase, cover, or conduct any wire, cable, or appliance, to conduct or handle electricity, unless such subway, manhole, chamber, or underground room has an inside measurement of not less than four feet at the maximum points between the side walls thereof, and between the end walls thereof, and not less than five feet at all points between the floor and the top or ceiling thereof, or if circular in shape, at least four feet diameter inside measurement and not less than five feet at all points between the floor and ceiling thereof. This section does not apply to any such subway, manhole, chamber, or underground room, within which it is not intended or required that any human being perform work or labor or be employed. This section does not apply where satisfactory proof is submitted to the commission that it is impracticable or physically impossible to comply with this law within the space or location so designated by the proper municipal authorities.
No person shall build or rebuild in any subway, manhole, chamber, or underground room used or to be used to contain, encase, cover, or conduct any wire, cable, or appliance to conduct or handle electricity, any opening to outer air which is less than 26 inches if circular in shape, or less than 24 inches by 26 inches clear measurement if rectangular in shape.
No person shall build or rebuild in any subway, manhole, chamber, or underground room, used or to be used to contain, encase, cover, or conduct any wire, cable, or appliance to conduct or handle electricity, any opening which is at the surface of the ground, within the distance of three feet at any point from the rail of any railway or streetcar track. This section does not apply where satisfactory proof is submitted to the commission that it is impracticable or physically impossible to comply with this law in the space or location so designated by the proper municipal authorities.
No person shall build or rebuild any subway, manhole, chamber, or underground room, used or to be used, to contain, encase, cover, or conduct any wire, cable, or appliance to conduct or handle electricity unless the floor of the subway, manhole, chamber, or underground room is made of stone, concrete, brick, or other similar material not subject to decomposition. This section does not apply to any subway, manhole, chamber, or underground room within which it is not intended or required that any human being perform work or labor or be employed.
No person shall build or rebuild or maintain any subway, manhole, chamber, or underground room used, or to be used, to contain, encase, cover, or conduct any wire, cable, or appliance to conduct or handle electricity, unless such subway, manhole, chamber, or underground room is kept at all times in a sanitary condition and free from stagnant water, seepage, or other drainage, or any offensive matter dangerous to health, either by sewer connection or otherwise. This section does not apply to any subway, manhole, chamber, or underground room within which it is not intended or required that any human being perform work or labor, or be employed.
The commission may inspect all work which is included in the provisions of this article, and may make such further additions or changes as the commission deems necessary for the purpose of safety to employees and the general public. The commission shall enforce the provisions of this article.
Any violation of any provision of this article is a misdemeanor.
CHAPTER 6. Electric Service Areas [8101. - 8108.]
ARTICLE 1. Designation by Public Utilities Commission [8101. - 8108.]
Under certain conditions the sale and distribution of electric power and energy in the same geographical area both by an electrical utility and by an irrigation district, results in duplication of service, waste of materials, increase in costs, waste of manpower and economic loss, and is detrimental to the efficiency and best interests of such districts. It is the policy of this State to induce such utilities and irrigation districts to prevent or remove such economic waste and to adopt more efficient and economic methods of distribution of electric power and energy, and to that end encourage the definition of areas to be served or not to be served by each.
Any utility may petition the commission setting forth in its petition the following:
That the petitioner and an irrigation district formed under the laws of this State are both engaged or propose to engage in the sale and distribution of electric power and energy in the described area or areas or in contiguous areas, or that the petitioner proposes to sell an electric distribution system in a described area, to such irrigation district.
That the petitioner and irrigation district are desirous of entering into a contract in which, among other things, and as one of the considerations therefor, they consent to the limitation of areas which each are to serve or are to be excluded from serving.
A copy of the contract or proposed contract.
A description of the respective areas that the limitations will affect and the terms of the contract, if any, or the conditions, if any, existing in connection with such limitations or the sale or acquisition of a utility distribution system.
A prayer that the commission issue its order limiting the area or areas within which the petitioner may, directly or indirectly, sell or distribute electric power or energy or define the area or areas within which the petitioner shall not sell or distribute electric power or energy as indicated in the petition and set forth in a contract or proposed contract.
Thereupon, the commission shall cause an investigation to be made and may conduct such hearings in connection therewith as it considers desirable.
If the commission finds that it is for the best interests of the State and of the utility, and not incompatible with any public interest that the petition be granted, it shall make and issue its order limiting the area or areas within which the utility shall have the right and authority to sell or distribute electric power or energy, directly or indirectly, or define the area or areas within which the utility shall not have the right or authority to sell or distribute electric power or energy, directly or indirectly. The commission may, in its order, approve and thereby authorize the contract or conditions, if any, in connection therewith. No limitation or definition of area or areas or statement of conditions shall be included in the order except as contained in the petition and contract.
Where limitation of areas to be served or limitations or designations of areas not to be served by the utility and by an irrigation district have heretofore been approved or are hereafter approved by the commission they shall be deemed to have complied with this article.
In any civil or criminal action or proceeding for violation of the Cartwright Act (Chapter 530, Statues of 1907), Part 2 of Division 7 of the Business and Professions Code, or any rule of statutory or common law against monopolies or combinations in restraint of trade, proof that the act complained of was done in compliance with this article or an order issued under it and in furtherance of the purposes and provisions of this article is a complete defense in such action or proceeding.
If, in any contract submitted and approved by the commission or in any order made by the commission pursuant to application and petition as in this article provided, it is provided that the utility is not to serve or furnish electric energy in a specified area or areas, or is to furnish or serve electric energy under limited or specified circumstances only, or is to refrain from serving or furnishing electric energy in certain specified areas or under certain specified circumstances or under certain specified limitations, then, from and after the effective date of such order of the commission, it shall be unlawful for the utility to serve electric energy in any area or in any manner which the contract and order provides that service shall not be rendered, and the affected district shall be entitled, as a matter of right, to an injunction to prevent any such unlawful act on the part of the utility.
CHAPTER 7. Miscellaneous Regulations [8201. - 8290.2.]
ARTICLE 1. Adequate Water Service [8201. - 8204.]
Any water company having a franchise to use the streets of a city, shall properly and adequately serve with water the inhabitants of the territory for the service of which it has such franchise.
As used in this section, to “properly and adequately serve with water” includes furnishing water of a quality meeting or exceeding standards established by the State Department of Health pursuant to Section 4026 of the Health and Safety Code.
If the commission has jurisdiction of extensions and service in the city it shall enforce a compliance with Section 8201. If the commission does not have such jurisdiction, then the governing body of the city shall adopt rules to enforce a compliance with Section 8201.
In addition to the penalties which may be provided by the governing body of a city for failure to comply with such regulations adopted by it, any person aggrieved by the failure of any water company to comply with such regulations may recover, by civil action against such water company, twice the amount of damages he may sustain by reason of such failure.
“Water company” as used in this article, includes any person, firm, or private corporation engaged in the business of supplying water for domestic use within any city.
ARTICLE 2. Railroad and Steamboat Police [8226. - 8227.]
The Governor of the state may, upon the application of any railroad company, appoint and commission during his or her pleasure one or more persons designated by the company, to serve at the expense of the company, as police officers, who shall have the powers and authority of peace officers listed in Section 830.33 of the Penal Code, after being duly sworn. The company designating these persons shall be responsible civilly for any abuse of their authority.
Every peace officer designated under Section 8226 shall, when in uniform, wear in plain view a shield bearing the words “railroad police,” and the name of the company for which he or she is commissioned. When on duty, but not in uniform, the peace officer shall carry the shield upon his or her person and present it upon request.
ARTICLE 3. Use of “Spotter” Reports [8251. - 8252.]
It is unlawful for any public service corporation, or agent, superintendent, or manager thereof, employing any special agent, detective, or person commonly known as a “spotter,” for the purpose of investigating, obtaining, and reporting to the employer information concerning its employees, to discipline or discharge any employee, where such act of discipline or the discharge is based upon a report by such special agent, detective, or spotter, which report involves a question of integrity, honesty, or a breach of rules of the employer, unless such employer, its agent, superintendent, or manager, gives notice and accords a hearing to the employee thus accused, when requested by the employee. At such hearing the employer shall state specific charges on which act of discipline or discharge is based, and the accused employee shall have the right to furnish testimony in his defense.
Each violation of this article by any person, firm, association, or corporation is a misdemeanor, and upon conviction thereof shall be punishable by a fine of not less than one hundred dollars ($100) and not more than six hundred dollars ($600), or by imprisonment in the county jail for a period of not more than one (1) year, or by both such fine and imprisonment. In case of a public service corporation committing any violation of this article, the imprisonment when imposed shall be imposed upon the officers or agents thereof committing such offense.
ARTICLE 4. Retirement Fund Investment Losses [8276. - 8279.]
The commission shall prohibit any public utility that has any retirement funds invested in the government of Libya, or in any corporation based in that country, from including in its plant operating budget any losses incurred as a result of those investments.
The commission shall require every public utility to provide the commission with a list of its retirement fund investments in the government of Libya, or in any corporation based in that country.
The commission shall verify the accuracy of the information provided pursuant to Section 8277, and shall disallow any losses incurred as a result of investments in the government of Libya, or in any corporation based in that country, in establishing rates for the public utility.
This article does not prevent the commission from applying this article to public utility retirement fund investments in other countries such as, but not limited to, Libya, if comparable conditions warrant that application.
ARTICLE 5. Women, Minority, Disabled Veteran, and LGBT Business Enterprises [8281. - 8286.]
The Legislature hereby finds and declares that the essence of the American economic system of private enterprise is free, open, and transparent competition. Only through free, open, and transparent competition can free markets, reasonable and just prices, and creative and innovative opportunities for growth of personal initiative and individual judgment be ensured. The preservation and expansion of that competition are basic to the economic well-being of this state and that well-being cannot be realized unless the actual and potential capacity of women, minority, disabled veteran, and LGBT business enterprises is encouraged and developed. Therefore, it is the declared policy of the state to aid the interests of women, minority, disabled veteran, and LGBT business enterprises in order to preserve reasonable and just prices and a free competitive enterprise, to ensure that a fair proportion of the total purchases and contracts or subcontracts for commodities, supplies, technology, property, and services for regulated public utilities, including, but not limited to, renewable energy, wireless telecommunications, broadband, smart grid, and rail projects, are awarded to women, minority, disabled veteran, and LGBT business enterprises, and to maintain and strengthen the overall economy of the state.
The Legislature finds all of the following:
The opportunity for full participation in our free enterprise system by women, minority, disabled veteran, and LGBT business enterprises is essential if this state is to attain social and economic equality for those businesses and improve the functioning of the state economy. By providing more transparency on who is performing the work in the state, the state will see a broader and deeper economic impact.
Public agencies and some regulated utilities that have established short- and long-range women, minority, disabled veteran, and LGBT business enterprise goals are awarding 30 percent or more of their contracts to these business enterprises.
Women, minority, disabled veteran, and LGBT business enterprises have traditionally received less than a proportionate share of regulated public utility procurement contracts, especially in renewable energy, wireless telecommunications, broadband, smart grid, and rail projects.
It is in the state’s interest to expeditiously improve the economically disadvantaged position of women, minority, disabled veteran, and LGBT business enterprises. It is also in the state’s interest to see the number of women, minority, disabled veteran, and LGBT business enterprises increase by unbundling the work with prime contractors and enabling subcontractors of the prime contractor to report their subcontracted spending with women, minority, disabled veteran, and LGBT business enterprises to further enhance the opportunities for women, minority, disabled veteran, and LGBT business enterprises.
The position of these businesses can be substantially improved by providing long-range substantial goals for procurement by regulated public utilities of technology, equipment, supplies, services, materials, and construction work, especially in renewable energy, wireless telecommunications, broadband, smart grid, and rail projects, from women, minority, disabled veteran, and LGBT businesses.
That procurement also benefits the regulated public utilities and consumers of the state by encouraging the expansion of the number of suppliers for procurements, thereby encouraging competition among the suppliers and promoting economic efficiency in the process.
That the long-term economic viability of this state depends substantially on the ability of renewable energy, wireless telecommunications, broadband, smart grid, and rail projects to incorporate women, minority, disabled veteran, and LGBT businesses into those projects.
Employment within the state benefits local communities on many different levels, including, but not limited to, the state receiving more revenue from employee taxes, more consumable expenditures, and more wealth within the state. Monitoring employment beyond women, minority, disabled veteran, and LGBT entrepreneurs expands the economic reach to all suppliers and utilities operating in the state.
It is the purpose of this article to do all of the following:
Encourage greater economic opportunity for women, minority, disabled veteran, and LGBT business enterprises.
Promote competition among regulated public utility suppliers in order to enhance economic efficiency in the procurement of electrical, gas, water, wireless telecommunications service provider, and telephone corporation contracts and contracts of their commission-regulated subsidiaries and affiliates.
Clarify and expand the program for the procurement by regulated public utilities of technology, equipment, supplies, services, materials, and construction work from women, minority, disabled veteran, and LGBT business enterprises.
For the purposes of this article, the following definitions apply:
“Control” means exercising the power to make policy decisions.
“Disabled veteran business enterprise” has the same meaning as defined in Section 999 of the Military and Veterans Code.
“LGBT business enterprise” means a business enterprise that is at least 51-percent owned by a lesbian, gay, bisexual, or transgender person or persons; or, in the case of any publicly owned business, at least 51 percent of the stock of which is owned by one or more lesbian, gay, bisexual, or transgender persons; and whose management and daily business operations are controlled by one or more of those individuals.
“Minority business enterprise” means a business enterprise that is at least 51-percent owned by a minority group or groups; or, in the case of any publicly owned business, at least 51 percent of the stock of which is owned by one or more minority groups, and whose management and daily business operations are controlled by one or more of those individuals. The contracting utility shall presume that minority includes African Americans, Hispanic Americans, Native Americans, and Asian Pacific Americans.
To “operate” means to be actively involved in the day-to-day management. It is not enough to merely be an officer or director.
“Renewable energy project” means a project for the development and operation of an eligible renewable energy resource meeting the requirements of the California Renewables Portfolio Standard Program (Article 16 (commencing with Section 399.11) of Chapter 2.3 of Part 1 of Division 1).
“Women business enterprise” means a business enterprise that is at least 51-percent owned by a woman or women; or, in the case of any publicly owned business, at least 51 percent of the stock of which is owned by one or more women; and whose management and daily business operations are controlled by one or more of those individuals.
The commission shall require each electrical corporation, gas corporation, water corporation, wireless telecommunications service provider, electric service provider, and telephone corporation with gross annual California revenues exceeding twenty-five million dollars ($25,000,000), and their commission-regulated subsidiaries and affiliates, to submit annually a detailed and verifiable plan for increasing procurement from women, minority, disabled veteran, and LGBT business enterprises in all categories, including, but not limited to, renewable energy, energy storage system, wireless telecommunications, broadband, smart grid, vegetation management, and rail projects.
These annual plans shall include short- and long-term goals and timetables, but not quotas, and shall include methods for encouraging both prime contractors and grantees to engage women, minority, disabled veteran, and LGBT business enterprises in subcontracts in all categories that provide subcontracting opportunities, including, but not limited to, renewable energy, energy storage system, wireless telecommunications, broadband, smart grid, vegetation management, and rail projects.
The commission shall establish guidelines for all electrical corporations, gas corporations, water corporations, wireless telecommunications service providers, electric service providers, and telephone corporations with gross annual California revenues exceeding twenty-five million dollars ($25,000,000), and their commission-regulated subsidiaries and affiliates, to be used in establishing programs pursuant to this article.
Every electrical corporation, gas corporation, water corporation, wireless telecommunications service provider, electric service provider, and telephone corporation with gross annual California revenues exceeding twenty-five million dollars ($25,000,000) shall furnish an annual report to the commission regarding the implementation of programs established pursuant to this article in a form that the commission shall require, and at the time that the commission shall annually designate.
The Legislature declares that each electrical corporation, gas corporation, water corporation, mobile telephony service provider, electric service provider, and telephone corporation that is not required to submit a plan pursuant to subdivision (a) is encouraged to voluntarily adopt a plan for increasing women, minority, disabled veteran, and LGBT business enterprise procurement in all categories.
The Legislature declares that each cable television corporation, direct broadcast satellite provider, exempt wholesale generator contracting to sell electricity to a retail seller, distributed energy resource contractor, and energy storage system company is encouraged to voluntarily adopt a plan for increasing women, minority, disabled veteran, and LGBT business enterprise procurement and to voluntarily report activity in this area to the Legislature on an annual basis.
The commission shall require each electrical corporation, gas corporation, water corporation, wireless telecommunications service provider, electric service provider, and telephone corporation with gross annual California revenues exceeding fifteen million dollars ($15,000,000), but not more than twenty-five million dollars ($25,000,000), to annually submit data in a simplified form to the commission on its procurement from women, minority, disabled veteran, and LGBT business enterprises in all categories, including, but not limited to, renewable energy, energy storage system, wireless telecommunications, broadband, smart grid, vegetation management, and rail projects.
As part of each annual report or data submission required pursuant to subdivision (d) or (f), the electrical corporation, gas corporation, water corporation, wireless telecommunications service provider, electric service provider, or telephone corporation shall provide all of the following information in the aggregate:
The number of new contractors and subcontractors certified pursuant to General Order 156 with which it contracted.
The total dollar amounts expended with in-state contractors certified under General Order 156.
The total dollar amounts expended with in-state subcontractors certified under General Order 156.
The percentage of the total workforce used by contractors and subcontractors that reside in California.
Data regarding the diversity of contractor or subcontractor workforces, to the extent that the data is provided voluntarily by the employees of the contractor or subcontractor.
An electrical corporation, gas corporation, water corporation, wireless telecommunications service provider, electric service provider, or telephone corporation may use data provided to the commission pursuant to subdivision (b) of Section 8284 to satisfy the requirements of paragraph (1).
For purposes of this section, the following terms have the following meanings:
“Distributed energy resource contractor” means any corporation or other business entity that employs anyone licensed by the Contractors State License Board to perform installations of distributed energy resources, as defined in Section 8370.
“Energy storage system company” means any person or corporation operating a centralized or distributed energy storage system, as defined in Section 2835, that furnishes electricity to an electrical corporation, local publicly owned electric utility, community choice aggregator, or electric service provider within California, or that supplies electricity to a retail end-use customer of an electrical corporation, local publicly owned electric utility, community choice aggregator, or electric service provider within California.
“Other business entity” has the same meaning as defined in Section 174.5 of the Corporations Code.
The commission shall, by rule or order, adopt criteria for verifying and determining the eligibility of women, minority, and LGBT business enterprises for procurement contracts.
The commission shall adopt the Department of General Services’ disabled veteran business enterprise certification eligibility requirements for verifying and determining the eligibility of disabled veteran business enterprises for procurement contracts, and shall not deem eligible those disabled veteran business enterprises that are not certified by the Department of General Services.
In initially adopting criteria for verifying and determining the eligibility of LGBT business enterprises for procurement contracts pursuant to paragraph (1), the commission shall adopt the LGBT status qualifiers created by the National Gay and Lesbian Chamber of Commerce. The commission may update these LGBT status qualifiers as appropriate.
The commission shall add all of the following questions to the verification form described in General Order 156:
Questions about the location of the business enterprise’s headquarters.
Questions about the business enterprise’s operating locations in California.
Questions about the percentage of the business enterprise’s employees that reside in California.
The commission shall develop, and require every electrical corporation, gas corporation, water corporation, wireless telecommunications service provider, electric service provider, and telephone corporation with gross annual California revenues exceeding twenty-five million dollars ($25,000,000) and their commission-regulated subsidiaries and affiliates to implement, an outreach program to inform and recruit women, minority, disabled veteran, and LGBT business enterprises to apply for procurement contracts under this article.
Any person or corporation, through its directors, officers, or agents, that falsely represents a business as a women, minority, or LGBT business enterprise in the procurement of, or the attempt to procure, contracts from an electrical corporation, gas corporation, water corporation, wireless telecommunications service provider, electric service provider, or telephone corporation with gross annual California revenues exceeding twenty-five million dollars ($25,000,000), or a commission-regulated subsidiary or affiliate subject to this article, or from an electrical corporation, gas corporation, water corporation, wireless telecommunications service provider, electric service provider, and telephone corporation with gross annual California revenues exceeding fifteen million dollars ($15,000,000), but not more than twenty-five million dollars ($25,000,000), shall be punished by a fine of not more than five thousand dollars ($5,000), by imprisonment in a county jail for not more than one year or in the state prison, or by both that fine and imprisonment. In the case of a corporation, the fine or imprisonment, or both, shall be imposed on every director, officer, or agent responsible for the false statements.
Any person or corporation, through its directors, officers, or agents, that falsely represents a business as a disabled veteran business enterprise in the procurement of, or the attempt to procure, contracts from an electrical corporation, gas corporation, water corporation, wireless telecommunications service provider, electric service provider, or telephone corporation with gross annual California revenues exceeding twenty-five million dollars ($25,000,000), or a commission-regulated subsidiary or affiliate subject to this article, or from an electrical corporation, gas corporation, water corporation, wireless telecommunications service provider, electric service provider, and telephone corporation with gross annual California revenues exceeding fifteen million dollars ($15,000,000), but not more than twenty-five million dollars ($25,000,000), shall be punished according to the penalties established pursuant to subdivision (b) of Section 999.9 of the Military and Veterans Code. In the case of a corporation, the fine or imprisonment, or both, shall be imposed on every director, officer, or agent responsible for the false statements.
In order to facilitate the participation of women, minority, disabled veteran, and LGBT business enterprises and small businesses in contract procurement, any corporation subject to this article may consider the following measures to include those businesses in all phases of their contracting:
Timely or progressive payments to those businesses.
An amendment of the performance bond requirements so that bond requirements of electrical, gas, and telephone corporations do not prohibitively burden those businesses from procuring the corporation’s business.
The provision of assistance to those businesses by securing contract payments to those businesses with letters of credit, negotiable securities, or other financing arrangements or measures.
This section does not restrict a corporation’s ability to require a bond.
ARTICLE 6. Diversity, Equity, and Inclusion Employment Report [8290. - 8290.2.]
In addition to Section 8281, the Legislature finds and declares both of the following:
Public agencies and some regulated utilities should establish short- and long-term plans to advance diversity and equity, and include doing so in their employment practices.
Encouraging utility work to be performed locally and with a reasonably proportionate number of employees from women, minority, disabled veteran, and LGBT communities, the state is better serving and financially impacting the communities they serve.
It is the declared policy of the state to aid the interests of women, minority, disabled veteran, and LGBT individuals by providing access to local jobs for women, minorities, disabled veterans, and LGBT individuals through strong diversity, equity, and inclusion plans.
The purpose of this article is to promote and enhance diversity, equity, and inclusion employment plans for utilities in the state by including reporting entities’ workforce information in the commission’s analysis of the Supplier Diversity Program’s success.
The commission shall require each electrical corporation, gas corporation, water corporation, wireless telecommunications service provider, electric service provider, and telephone corporation with gross annual California revenues exceeding twenty-five million dollars ($25,000,000), and their commission-regulated subsidiaries and affiliates, to annually submit to the commission a report describing the employment of women, minority, disabled veteran, and LGBT individuals at all levels of employment within their organization and describing the diversity, equity, and inclusion policies or activities that promote equitable recruitment and hiring.
The commission shall direct each community choice aggregator with gross annual revenues exceeding fifteen million dollars ($15,000,000), as described in subdivision (m) of Section 366.2, to annually submit to the commission a report describing the employment of women, minority, disabled veteran, and LGBT individuals at all levels of employment within its organization and describing the diversity, equity, and inclusion policies or activities that promote equitable recruitment and hiring.
Every entity specified in subdivision (a) shall furnish an annual report to the commission regarding the implementation of the programs established pursuant to this article in a form that the commission requires and at the time that the commission annually designates.
The Legislature declares that each community choice aggregator, electrical corporation, gas corporation, water corporation, mobile telephony service provider, electric service provider, and telephone corporation that is not required to submit a report pursuant to subdivision (a) is encouraged to voluntarily adopt a plan for increasing women, minority, disabled veteran, and LGBT employment at all levels of employment in those entities.
The Legislature declares that each cable television corporation, direct broadcast satellite provider, exempt wholesale generator contracting to sell electricity to a retail seller, distributed energy resource contractor, and energy storage system company is encouraged to voluntarily adopt a plan for increasing women, minority, disabled veteran, and LGBT employment at all levels of employment in those entities.
DIVISION 4.1. PROVISIONS APPLICABLE TO PRIVATELY OWNED AND PUBLICLY OWNED PUBLIC UTILITIES [8301. - 8550.]
CHAPTER 1. Nuclear Powerplant Communities Information [8301. - 8302.]
This chapter shall be known and may be cited as the Nuclear Powerplant Communities Information Act of 1985.
Every privately owned and publicly owned public utility generating electricity by means of any nuclear powerplant and every privately owned and publicly owned public utility with a nuclear powerplant that is no longer producing electricity but is in the decommissioning process or is still radioactive shall do both of the following:
Provide periodically, as required by the United States Nuclear Regulatory Commission, but at least every two years, by mail or by hand delivery, with that information as may be required by the commission to be disseminated to the public, either to all residents within a 10-mile radius of the powerplant or to those persons designated by the commission, whichever is the greater number of persons, a general description of the powerplant, emergency evacuation information, and substantive revisions thereof, and the titles, addresses, and telephone numbers of the federal, state, and local public officials who may be contacted for more detailed information concerning powerplant status and discharges.
Provide, at least twice each year, a copy of the public utility’s “Effluent Monitoring Report” to the county health officer in the county where the nuclear powerplant is located.
CHAPTER 1.5. Worksite Automated External Defibrillators [8310. - 8310.]
Each utility, and independent contractor or subcontractor of a utility, shall do both of the following:
Have an automated external defibrillator (AED) available for emergency use at each worksite where two or more electrical utility workers are performing work on electrical transmission or distribution lines of 601 volts or more.
Adopt, consistent with its duty to furnish and use safety devices and safeguards as required by Section 6401 of the Labor Code and as part of its injury prevention program that conforms to the requirements of Section 6401.7 of the Labor Code, a written program of policies and procedures to ensure both of the following:
Any person who renders emergency care or treatment to a person in cardiac arrest by using an AED shall activate the emergency medical services system as soon as possible and report the use of the AED to the local EMS agency.
All employees, contractors, and subcontractors shall be trained on the use of an AED and the procedures to be followed in the event of an emergency, including, but not limited to, the requirement to activate the emergency medical services system as soon as possible and report the use of the AED to the local EMS agency.
Each utility, and independent contractor or subcontractor of a utility, shall comply with the requirements of Section 1797.196 of the Health and Safety Code.
A person who, in good faith and not for compensation, renders emergency care or treatment by the use of an AED is not liable for civil damages resulting from any acts or omissions of the person rendering the emergency care as provided in subdivision (b) of Section 1714.21 of the Civil Code.
A utility or an independent contractor or subcontractor of a utility that acquires an AED for emergency use, makes reasonable efforts to comply with the requirements of subdivision (a), and complies with subdivision (b), is not liable for any civil damages resulting from the emergency use of the AED as provided in subdivision (d) of Section 1714.21 of the Civil Code.
A person who renders emergency treatment by means of an AED and is not compensated for doing so, but receives compensation for other actions as a result of their unrelated employment, does not render emergency medical care “for compensation.”
Subdivisions (c) and (d) do not apply in cases described in subdivision (e) of Section 1714.21 of the Civil Code.
For purposes of this section, all of the following definitions apply:
“Electrical cooperative” has the same meaning as defined in Section 2776.
“Electrical corporation” has the same meaning as defined in Section 218.
“Local EMS agency” means an agency described in Section 1797.200 of the Health and Safety Code.
“Local publicly owned electric utility” has the same meaning as defined in Section 224.3.
“Utility” means an electrical corporation, electrical cooperative, or local publicly owned electric utility.
CHAPTER 2. Decommissioning of Nuclear Facilities [8321. - 8330.]
This chapter shall be known and may be cited as the Nuclear Facility Decommissioning Act of 1985.
The Legislature hereby finds and declares all of the following:
The citizens of California should be protected from exposure to radiation from nuclear facilities.
It is in the best interests of all citizens of California that the costs of electricity generated by nuclear facilities be fairly distributed among present and future California electric customers so that customers are charged only for costs that are reasonably and prudently incurred.
The costs of electricity generated by nuclear facilities, including the costs of their decontamination and decommissioning, should be reduced to the lowest level consistent with public health and safety.
The ultimate costs of the decommissioning of nuclear facilities are of significant magnitude, and introduce an element of financial risk to both electric customers and investors unless prudent provision is made for defraying those costs.
In order to reduce both risk and ultimate costs for all of its citizens, the State of California should establish a comprehensive framework for timely payment of the costs of decommissioning, and provide for allocation of risks and costs among the respective interests.
The principal considerations in establishing a state policy respecting the economic aspects of decommissioning are as follows:
Assuring that the funds required for decommissioning are available at the time and in the amount required for protection of the public.
Minimizing the cost to electric customers of an acceptable level of assurance.
Structuring payments for decommissioning so that electric customers and investors are treated equitably over time so that customers are charged only for costs that are reasonably and prudently incurred.
Decommissioning nuclear facilities causes electric utility employees to become unemployed through no fault of their own, and these employees are entitled to reasonable job protection the costs of which are properly includable in the costs of decommissioning.
It is the intent of the Legislature in enacting this chapter to protect electric customers, both present and future, from the risks of unreasonable costs associated with ownership and operation of nuclear powerplants. To that end, the commission or board with respect to each electric utility owning or operating a nuclear powerplant, shall develop regulations and guidelines that promote realism in estimating costs, provide periodic review procedures that create maximum incentives for accurate cost estimations, and provide for decommissioning cost controls.
Unless the context otherwise requires, the definitions in this section govern the construction of this chapter.
“Board” means the board of directors or other governing body of a publicly owned public utility owning or operating a nuclear power plant.
“Commission” means the Public Utilities Commission.
“Electrical utility” includes both an electrical corporation subject to the jurisdiction and control of the commission and a publicly owned public utility subject to the jurisdiction and control of its board, in either case owning or operating nuclear facilities for the generation of electricity.
“Decommissioning” means to remove nuclear facilities safely from service and to reduce residual radioactivity to a level that permits release of the property for unrestricted use and termination of license, or as otherwise defined by the Nuclear Regulatory Commission or its successor. Decommissioning includes other activities and costs, if any, which may be included in Internal Revenue Service regulations implementing Section 468A of the United States Internal Revenue Code.
“Nuclear facilities” means the site, building and contents, and equipment associated with any activity licensed by the Nuclear Regulatory Commission, or as may be otherwise defined by the Nuclear Regulatory Commission or its successor.
Each electrical corporation owning, in whole or in part, or operating nuclear facilities, located in California or elsewhere, shall establish an externally managed, segregated fund for the purposes of this chapter. In addition, each electrical corporation may establish other funds, as appropriate, for payment of decommissioning costs of nuclear facilities.
The externally managed, segregated fund established pursuant to subdivision (a) shall be a fund which qualifies for a tax deduction pursuant to Section 468A of the United States Internal Revenue Code, and applicable regulations of the Internal Revenue Service adopted pursuant thereto, if that tax treatment is determined by the commission to be in the best long-term interests of the customers of the electrical utility.
The commission shall authorize an electrical corporation to collect sufficient revenues in rates to make the maximum contributions to the fund established pursuant to Section 468A of the United States Internal Revenue Code and applicable regulations, that are deductible for federal and state income tax purposes, and to otherwise recover the revenue requirements associated with reasonable and prudent decommissioning costs of the nuclear facilities for purposes of making contributions into other funds established pursuant to subdivision (a).
Notwithstanding any other provision of this section, an electrical utility, which is a publicly owned public utility subject to the jurisdiction and control of its board, shall establish and may manage a separate fund for purposes of this chapter. The board shall provide that the amounts of all payments into this fund are recoverable through the utility’s electric rates.
Each electrical utility owning, in whole or in part, or operating a nuclear facility, located in California or elsewhere, shall provide a decommissioning cost estimate to the commission or the board for all nuclear facilities which shall include all of the following:
An estimate of costs of decommissioning.
A description of changes in regulation, technology, and economics affecting the estimate of costs.
A description of additions and deletions to nuclear facilities.
Upon request of the commission or the board, other information required by the Nuclear Regulatory Commission regarding decommissioning costs.
The decommissioning costs estimate study shall be periodically revised in accordance with procedures adopted by the commission or the board pursuant to Section 8327.
The commission or the board shall review, in conjunction with each proceeding of the electrical utility held for the purpose of considering changes in electrical rates or charges, the decommissioning costs estimate for the electrical utility in order to ensure that the estimate takes account of the changes in the technology and regulation of decommissioning, the operating experience of each nuclear facility, and the changes in the general economy. The review shall specifically include all cost estimates, the basis for the cost estimates, and all assumptions about the remaining useful life of the nuclear facilities.
The expenses associated with decommissioning of nuclear facilities shall be paid from the funds established pursuant to Section 8325. If the money in the funds is insufficient for payment of all decommissioning costs, the commission or the board shall determine whether the costs incurred in excess of the money in the funds are reasonable in amount and prudently incurred. If the commission or the board determines that the excess costs are reasonable in amount and prudently incurred, the commission or the board shall authorize these costs to be charged to the customers of the electric utility.
The commission or the board shall, for purposes of establishing rates or charges, review and approve the estimated service life and estimated retirement date of all nuclear facilities.
Every electrical utility involved in decommissioning, closure, or removal of nuclear facilities, shall provide assistance in finding comparable alternative employment opportunities for its employees who become unemployed as the result of decommissioning, closure, or removal. The commission or the board shall authorize the electrical utility to collect sufficient revenue through electric rates and charges to recover the cost, if any, of compliance with this section.
CHAPTER 3. Greenhouse Gases Emission Performance Standard for Baseload Electrical Generating Resources [8340. - 8341.]
For purposes of this chapter, the following terms have the following meanings:
“Baseload generation” means electricity generation from a powerplant that is designed and intended to provide electricity at an annualized plant capacity factor of at least 60 percent.
“Combined-cycle natural gas” with respect to a powerplant means the powerplant employs a combination of one or more gas turbines and steam turbines in which electricity is produced in the steam turbine from otherwise lost waste heat exiting from one or more of the gas turbines.
“Greenhouse gases” means those gases listed in Section 38505 of the Health and Safety Code.
“Load-serving entity” means every electrical corporation, electric service provider, or community choice aggregator serving end-use customers in the state.
“Long-term financial commitment” means either a new ownership investment in baseload generation or a new or renewed contract with a term of five or more years, which includes procurement of baseload generation.
“Output-based methodology” means a greenhouse gases emission performance standard that is expressed in pounds of greenhouse gases emitted per megawatthour and factoring in the useful thermal energy employed for purposes other than the generation of electricity.
“Plant capacity factor” means the ratio of the electricity produced during a given time period, measured in kilowatthours, to the electricity the unit could have produced if it had been operated at its rated capacity during that period, expressed in kilowatthours.
“Powerplant” means a facility for the generation of electricity, and includes one or more generating units at the same location.
“Zero- or low-carbon generating resource” means an electrical generating resource that will generate electricity while producing emissions of greenhouse gases at a rate substantially below the greenhouse gases emission performance standard, as determined by the commission.
No load-serving entity or local publicly owned electric utility may enter into a long-term financial commitment unless any baseload generation supplied under the long-term financial commitment complies with the greenhouse gases emission performance standard established by the commission, pursuant to subdivision (d), for a load-serving entity, or by the Energy Commission, pursuant to subdivision (e), for a local publicly owned electric utility.
The commission shall not approve a long-term financial commitment by an electrical corporation unless any baseload generation supplied under the long-term financial commitment complies with the greenhouse gases emission performance standard established by the commission pursuant to subdivision (d).
The commission may, in order to enforce this section, review any long-term financial commitment proposed to be entered into by an electric service provider or a community choice aggregator.
The commission shall adopt rules to enforce the requirements of this section, for load-serving entities. The commission shall adopt procedures, for all load-serving entities, to verify the emissions of greenhouse gases from any baseload generation supplied under a contract subject to the greenhouse gases emission performance standard to ensure compliance with the standard.
In determining whether a long-term financial commitment is for baseload generation, the commission shall consider the design of the powerplant and the intended use of the powerplant, as determined by the commission based upon the electricity purchase contract, any certification received from the Energy Commission, any other permit or certificate necessary for the operation of the powerplant, including a certificate of public convenience and necessity, any procurement approval decision for the load-serving entity, and any other matter the commission determines is relevant under the circumstances.
Costs incurred by an electrical corporation to comply with this section, including those costs incurred for electricity purchase agreements that are approved by the commission that comply with the greenhouse gases emission performance standard, are to be treated as procurement costs incurred pursuant to an approved procurement plan and the commission shall ensure timely cost recovery of those costs pursuant to paragraph (3) of subdivision (d) of Section 454.5.
A long-term financial commitment entered into through a contract approved by the commission, for electricity generated by a zero- or low-carbon generating resource that is contracted for, on behalf of consumers of this state on a cost-of-service basis, shall be recoverable in rates, in a manner determined by the commission consistent with Section 380. The commission may, after a hearing, approve an increase from one-half to 1 percent in the return on investment by the third party entering into the contract with an electrical corporation with respect to investment in zero- or low-carbon generation resources authorized pursuant to this subdivision.
In developing and implementing the greenhouse gases emission performance standard, the commission shall address long-term purchases of electricity from unspecified sources in a manner consistent with this chapter.
In developing and implementing the greenhouse gases emission performance standard, the commission shall consider and act in a manner consistent with any rules adopted pursuant to Section 824a-3 of Title 16 of the United States Code.
An electrical corporation that provides electric service to 75,000 or fewer retail end-use customers in California may file with the commission a proposal for alternative compliance with this section, which the commission may accept upon a showing by the electrical corporation of both of the following:
A majority of the electrical corporation’s retail end-use customers for electric service are located outside of California.
The emissions of greenhouse gases to generate electricity for the retail end-use customers of the electrical corporation are subject to a review by the utility regulatory commission of at least one other state in which the electrical corporation provides regulated retail electric service.
On or before June 30, 2007, the Energy Commission, at a duly noticed public hearing and in consultation with the commission and the State Air Resources Board, shall establish a greenhouse gases emission performance standard for all baseload generation of local publicly owned electric utilities at a rate of emissions of greenhouse gases that is no higher than the rate of emissions of greenhouse gases for combined-cycle natural gas baseload generation. The greenhouse gases emission performance standard established by the Energy Commission for local publicly owned electric utilities shall be consistent with the standard adopted by the commission for load-serving entities. Enforcement of the greenhouse gases emission performance standard shall begin immediately upon the establishment of the standard. All combined-cycle natural gas powerplants that are in operation, or that have an Energy Commission final permit decision to operate as of June 30, 2007, shall be deemed to be in compliance with the greenhouse gases emission performance standard.
The greenhouse gases emission performance standard shall be adopted by regulation pursuant to the Administrative Procedure Act (Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code).
In determining the rate of emissions of greenhouse gases for baseload generation, the Energy Commission shall include the net emissions resulting from the production of electricity by the baseload generation.
The Energy Commission shall establish an output-based methodology to ensure that the calculation of emissions of greenhouse gases for cogeneration recognizes the total usable energy output of the process, and includes all greenhouse gases emitted by the facility in the production of both electrical and thermal energy.
In calculating the emissions of greenhouse gases by facilities generating electricity from biomass, biogas, or landfill gas energy, the Energy Commission shall consider net emissions from the process of growing, processing, and generating the electricity from the fuel source.
Carbon dioxide that is captured from the emissions of a powerplant and that is permanently disposed of in geological formations in compliance with applicable laws and regulations, shall not be counted as emissions from the powerplant.
In adopting and implementing the greenhouse gases emission performance standard, the Energy Commission, in consultation with the Independent System Operator, shall consider the effects of the standard on system reliability and overall costs to electricity customers.
In developing and implementing the greenhouse gases emission performance standard, the Energy Commission shall address long-term purchases of electricity from unspecified sources in a manner consistent with this chapter.
In developing and implementing the greenhouse gases emission performance standard, the Energy Commission shall consider and act in a manner consistent with any rules adopted pursuant to Section 824a-3 of Title 16 of the United States Code.
The Energy Commission, in a duly noticed public hearing and in consultation with the commission and the State Air Resources Board, shall reevaluate and continue, modify, or replace the greenhouse gases emission performance standard when an enforceable greenhouse gases emissions limit is established and in operation, that is applicable to local publicly owned electric utilities.
The commission, through a rulemaking proceeding and in consultation with the Energy Commission and the State Air Resources Board, shall reevaluate and continue, modify, or replace the greenhouse gases emission performance standard when an enforceable greenhouse gases emissions limit is established and in operation, that is applicable to load-serving entities.
CHAPTER 3.5. Air Pollution Performance Standard for New Generation [8350. - 8350.]
For purposes of this section, the following terms have the following meanings:
“Load-serving entity” has the same meaning as that term is defined in Section 8340.
“Long-term financial commitment” has the same meaning as that term is defined in Section 8340.
“New electrical generating facility” means an electrical generating unit for which all legally required permits have been received after January 1, 2011. If an electrical generating unit is added to an existing powerplant after January 1, 2011, only the incremental capacity from that unit added after January 1, 2011, is a new electrical generating facility.
“Shared pollution area” means an airshed encompassing a portion of California and a portion of an adjacent state or country, as determined by the United States Environmental Protection Agency.
A load-serving entity or local publicly owned electric utility shall not enter into, and the commission shall not approve for an electrical corporation, a long-term financial commitment with or for a new electrical generating facility constructed in California or in a shared pollution area if that facility does not meet the following requirements:
If the new electrical generating facility is in California, the facility meets best available control technology (BACT) standards, to control air pollution emissions from the operation of the facility, and complies with air pollution control district or air quality management district rules and regulations, and state and federal law.
If the new electrical generating facility is outside of California in a shared pollution area, the facility meets best available control technology (BACT) standards, to control air pollution emissions from the operation of the facility, that apply in the air basin in California adjacent to the facility.
CHAPTER 4. Smart Grid Systems [8360. - 8369.]
It is the policy of the state to modernize the state’s electrical transmission and distribution system to maintain safe, reliable, efficient, and secure electrical service, with infrastructure that can meet future growth in demand and achieve all of the following, which together characterize a smart grid:
Increased use of cost-effective digital information and control technology to improve reliability, security, and efficiency of the electric grid.
Dynamic optimization of grid operations and resources, including appropriate consideration for asset management and utilization of related grid operations and resources, with cost-effective full cyber security.
Deployment and integration of cost-effective distributed resources and generation, including renewable resources.
Development and incorporation of cost-effective demand response, demand-side resources, and energy-efficient resources.
Deployment of cost-effective smart technologies, including real time, automated, interactive technologies that optimize the physical operation of appliances and consumer devices for metering, communications concerning grid operations and status, and distribution automation.
Integration of cost-effective smart appliances and consumer devices.
Deployment and integration of cost-effective advanced electricity storage and peak-shaving technologies, including plug-in electric and hybrid electric vehicles, and thermal-storage air-conditioning.
Provide consumers with timely information and control options.
Develop standards for communication and interoperability of appliances and equipment connected to the electric grid, including the infrastructure serving the grid.
Identification and lowering of unreasonable or unnecessary barriers to adoption of smart grid technologies, practices, and services.
For purposes of this chapter, “ISO” means the Independent System Operator operating pursuant to Article 3 (commencing with Section 345) of Chapter 2.3 of Part 1 of Division 1.
By July 1, 2010, the commission, in consultation with the Energy Commission, the ISO, and other key stakeholders shall determine the requirements for a smart grid deployment plan consistent with Section 8360 and federal law, including the provisions of Title XIII (commencing with Section 1301) of the Energy Independence and Security Act of 2007 (Public Law 110-140). The commission shall institute a rulemaking or expand the scope of an existing rulemaking to adopt standards and protocols to ensure functionality and interoperability developed by public and private entities, including, but not limited to, the National Institute of Standards and Technology, Gridwise Architecture Council, the International Electrical and Electronics Engineers, and the National Electric Reliability Organization recognized by the Federal Energy Regulatory Commission. An adopted smart grid deployment plan may provide for deployment of cost-effective smart grid products, technologies, and services by entities other than electrical corporations. The smart grid technologies and services shall improve overall efficiency, reliability, and cost-effectiveness of electrical system operations, planning, and maintenance.
This section does not require or authorize the commission to delay action on an application by an electrical corporation that is submitted prior to the commission determining the requirements for a smart grid deployment plan.
This chapter shall be implemented in a manner that does not compromise customer or worker safety or the integrity or reliability of the electrical transmission and distribution system in this state.
By July 1, 2011, each electrical corporation shall develop and submit a smart grid deployment plan to the commission for approval.
This section does not require or authorize the commission to delay action on an application by an electrical corporation that is submitted prior to the commission’s approval of the electrical corporation’s timely filed smart grid deployment plan.
Smart grid technology may be deployed in a manner to maximize the benefit and minimize the cost to ratepayers and to achieve the benefits of smart grid technology. The commission, in consultation with the Energy Commission, the ISO, and electrical corporations, shall evaluate the impact of deployment on major initiatives and policies including:
Implementation of new advanced metering initiatives.
Achievement of the renewables portfolio standard program requirements and the need to operate the smart grid of the future with a substantial increased percentage of electricity generated by eligible renewable energy resources.
Achievement of state goals for reducing emissions of greenhouse gases as set forth in the California Global Warming Solutions Act of 2006 and other state directives.
Modernizing the aging utility grid infrastructure.
Meeting the future energy growth needs of the state with new and innovative technologies and methods that utilize the existing assets more efficiently, result in a less environmentally adverse net impact on the state, meet stringent costs versus benefit assessments, and provide the ratepayers with new options in meeting their individual energy needs.
Implementation of technology to improve worker safety, protection, and productivity.
The commission may modify or adjust the requirements of this chapter for any electrical corporation with fewer than 100,000 service connections, as individual circumstances merit.
Each local publicly owned electric utility with more than 100,000 service connections, shall, by July 1, 2011, develop a smart grid deployment plan, that is consistent with federal law, including the provisions of Title XIII (commencing with Section 1301) of the Energy Independence and Security Act of 2007 (Public Law 110-140).
CHAPTER 4.5. Microgrids [8370. - 8372.]
For purposes of this chapter, the following definitions shall apply:
“Customer” means a customer of a local publicly owned electric utility or of a large electrical corporation. A person or entity is a customer of a large electrical corporation if the customer is physically located within the service territory of the large electrical corporation and receives bundled service, distribution service, or transmission service from the large electrical corporation.
“Distributed energy resource” means an electric generation or storage technology that complies with the emissions standards adopted by the State Air Resources Board pursuant to the distributed generation certification program requirements of Section 94203 of Title 17 of the California Code of Regulations, or any successor regulation.
“Large electrical corporation” means an electrical corporation with more than 100,000 service connections in California.
“Microgrid” means an interconnected system of loads and energy resources, including, but not limited to, distributed energy resources, energy storage, demand response tools, or other management, forecasting, and analytical tools, appropriately sized to meet customer needs, within a clearly defined electrical boundary that can act as a single, controllable entity, and can connect to, disconnect from, or run in parallel with, larger portions of the electrical grid, or can be managed and isolated to withstand larger disturbances and maintain electrical supply to connected critical infrastructure.
The commission, in consultation with the Energy Commission and the Independent System Operator, shall take all of the following actions by December 1, 2020, to facilitate the commercialization of microgrids for distribution customers of large electrical corporations:
Develop microgrid service standards necessary to meet state and local permitting requirements.
Without shifting costs between ratepayers, develop methods to reduce barriers for microgrid deployment.
Develop guidelines that determine what impact studies are required for microgrids to connect to the electrical corporation grid.
Without shifting costs between ratepayers, develop separate large electrical corporation rates and tariffs, as necessary, to support microgrids, while ensuring that system, public, and worker safety are given the highest priority. The separate rates and tariffs shall not compensate a customer for the use of diesel backup or natural gas generation, except as either of those sources is used pursuant to Section 41514.1 of the Health and Safety Code, or except for natural gas generation that is a distributed energy resource.
Form a working group to codify standards and protocols needed to meet California electrical corporation and Independent System Operator microgrid requirements.
Develop a standard for direct current metering in the commission’s Electric Rule 21 to streamline the interconnection process and lower interconnection costs for direct current microgrid applications.
Nothing in this chapter shall discourage or prohibit the development or ownership of a microgrid by an electrical corporation.
Within 180 days of the first request from a customer or developer to establish a microgrid, the governing board of a local publicly owned electric utility shall develop and make available a standardized process for the interconnection of a customer-supported microgrid, including separate electrical rates and tariffs, as necessary. The separate rates and tariffs shall not compensate a customer for the use of diesel backup or natural gas generation, except as either of those sources is used pursuant to Section 41514.1 of the Health and Safety Code, or except for natural gas generation that is a distributed energy resource.
The governing board shall ensure the microgrid rates and charges do not shift costs to, or from, a microgrid customer or nonmicrogrid customer, and shall ensure each microgrid and its components comply with the local publicly owned electric utility’s applicable regulatory requirements.
CHAPTER 4.6. Notice and Recordation of a Decarbonization Charge [8375. - 8377.]
It is the intent of the Legislature to establish transparency for renters and home buyers regarding the existence of a decarbonization charge associated with a decarbonization upgrade located on a property.
The Legislature finds and declares that the act of an energy supplier, including, but not limited to, a gas corporation, recording a notice of decarbonization charge pursuant to this chapter does not constitute a debt collection.
For purposes of this chapter, the following definitions apply:
“Decarbonization charge” means a charge that is added to the billing for service associated with the electrical meter, or other measuring device, under the control of an energy supplier located at the subscriber property where a decarbonization upgrade is located, and that is collected in order to pay for a decarbonization upgrade.
If an energy supplier is a gas corporation, as defined in Section 222, “decarbonization charge” shall be limited to a charge for measures that provide a measurable reduction in natural gas consumption and associated greenhouse gas emissions.
“Decarbonization upgrade” means all of the following:
A change to a subscriber property that reduces the demand for energy from an energy supplier.
A change to a subscriber property that allows for storage of energy.
A change to a subscriber property that reduces the use of fossil fuels.
A change to a subscriber property that converts water, wind, or sunlight to usable electricity.
“Energy supplier” means any of the following:
“Subscriber” means a person or entity that purchases energy or energy services from an energy supplier and is billed for the energy or energy services by the energy supplier, either directly or by another entity on behalf of the energy supplier.
“Subscriber property” means residential, commercial, industrial, agricultural, or other real property owned, leased, or licensed for occupancy by the subscriber.
This chapter shall apply to any program or initiative administered by an energy supplier that has all of the following attributes:
The program or initiative makes a site-specific investment to fund the installation of decarbonization upgrades on subscriber properties.
The program or initiative recovers any portion of the site-specific investment through decarbonization charges associated with one or more electrical meters, or other measuring devices, associated with those upgraded subscriber properties.
The program or initiative imposes a duty to pay the decarbonization charge that arises from, and is evidenced by, a written agreement executed relative to the installation of the decarbonization upgrade on the subscriber property between the property owner, or all current property owners of record, if different than the subscriber, and the energy supplier.
Under the program or initiative, the subscriber’s obligation to pay the decarbonization charge is associated with the electrical meter, or other measuring device, located at the subscriber’s property on which the decarbonization upgrade is located and is transferable to any successor subscriber who subsequently receives energy service at the property.
The commission, or the governing board of a local publicly owned electric utility or electrical cooperative, as applicable, shall require an energy supplier, in administering the program or initiative, to facilitate proper notification of upgrades and decarbonization charge obligations to successor subscribers by completing all of the following:
The energy supplier shall record, no later than 30 days after funding a decarbonization upgrade, a notice of decarbonization charge with the county recorder of the county where the property subject to the decarbonization charge is located. A county recorder, upon recording a notice of decarbonization charge, shall index the notice of decarbonization charge in the general index by the name of the owner of the real property where the electrical meter, or other measuring device, affected by the decarbonization charge will be located. The notice shall be entitled “NOTICE OF DECARBONIZATION CHARGE” and shall comply with Section 27324 of the Government Code. The recordation of the notice of decarbonization charge shall be considered sufficient notice to a subsequent subscriber at a property with installed decarbonization upgrades of the subscriber’s obligation to pay the decarbonization charge for installed measures.
The recorded notice of decarbonization charge shall contain all of the following information:
The address or legal description, the assessor’s parcel number, and the name of the owner, of the real property where the electrical meter, or other measuring device, affected by the decarbonization charge will be located.
The decarbonization charge amount and payment period.
A description of the decarbonization upgrades funded with the decarbonization charge.
Contact information for the person or entity authorized to provide a prompt and accurate written statement of the outstanding charges and payoff amounts related to the decarbonization charge for which the notice of decarbonization charge was recorded.
Within 30 days of full cost recovery of the outstanding charges related to the recorded notice of decarbonization charge, the energy supplier shall record a notice of the full cost recovery and removal of the decarbonization charge with the county recorder of the county where the property subject to the decarbonization charge is located. The notice of the full cost recovery and removal of the decarbonization charge shall include a reference to the recorded notice of decarbonization charge.
Within 30 days of a decision by the energy supplier to cease collection of the charge, the energy supplier shall record a notice of removal of the decarbonization charge with the county recorder of the county where the property subject to the decarbonization charge is located. The notice of the removal of the decarbonization charge shall include a reference to the recorded notice of the decarbonization charge.
When the subscriber property is not owner-occupied, the written agreement between the energy supplier and the property owner executed relative to the installation of the decarbonization upgrade shall incorporate a requirement that the property owner shall cause the obligation to pay the decarbonization charge to appear in the terms through which the subscriber leases or licenses the property for occupancy. This paragraph shall only apply to written agreements executed after January 1, 2023.
CHAPTER 5. Privacy Protections for Energy Consumption Data [8380. - 8381.]
For purposes of this section, “electrical or gas consumption data” means data about a customer’s electrical or natural gas usage that is made available as part of an advanced metering infrastructure, and includes incremental and monthly meter-specific electricity data, to the extent produced by that infrastructure, and the name, account number, and address of the customer.
An electrical corporation or gas corporation shall not share, disclose, or otherwise make accessible to any third party a customer’s electrical or gas consumption data, except as provided in subdivision (f) or upon the consent of the customer. Customer consent may be verified through an electronic signature authorization process pursuant to the Uniform Electronic Transactions Act (Title 2.5 (commencing with Section 1633.1) of Part 2 of Division 3 of the Civil Code).
An electrical corporation or gas corporation shall not sell a customer’s electrical or gas consumption data or any other personally identifiable information for any purpose.
An electrical corporation or gas corporation or its contractors shall not provide an incentive or discount to the customer for accessing the customer’s electrical or gas consumption data without the prior consent of the customer.
An electrical or gas corporation that utilizes an advanced metering infrastructure that allows a customer to access the customer’s electrical and gas consumption data shall ensure that the customer has an option to access that data without being required to agree to the sharing of the customer’s personally identifiable information, including electrical or gas consumption data, with a third party.
If an electrical corporation or gas corporation contracts with a third party for a service that allows a customer to monitor the customer’s electricity or gas usage, and that third party uses the data for a secondary commercial purpose, the contract between the electrical corporation or gas corporation and the third party shall provide that the third party prominently discloses that secondary commercial purpose to the customer and secures the customer’s consent to the use of the customer’s data for that secondary commercial purpose prior to the use of the data.
An electrical corporation or gas corporation shall use reasonable security procedures and practices to protect a customer’s unencrypted electrical or gas consumption data from unauthorized access, destruction, use, modification, or disclosure.
An electrical corporation or gas corporation shall not share, disclose, or otherwise make accessible to any immigration authority, as defined in Section 7284.4 of the Government Code, a customer’s electrical or gas consumption data without a court-ordered subpoena or judicial warrant.
This section does not preclude an electrical corporation or gas corporation from using customer aggregate electrical or gas consumption data for analysis, reporting, or program management if all information has been removed regarding the individual identity of a customer.
This section does not preclude an electrical corporation or gas corporation from disclosing a customer’s electrical or gas consumption data to a third party for system, grid, or operational needs, or the implementation of demand response, energy management, or energy efficiency programs, provided that, for contracts entered into after January 1, 2011, the utility has required by contract that the third party implement and maintain reasonable security procedures and practices appropriate to the nature of the information to protect the personal information from unauthorized access, destruction, use, modification, or disclosure, and prohibits the use of the data for a secondary commercial purpose not related to the primary purpose of the contract without the customer’s prior consent to that use.
Except as provided in subdivision (e), this section does not preclude an electrical corporation or gas corporation from disclosing electrical or gas consumption data as required or permitted under state or federal law or by an order of the commission.
If a customer chooses to disclose the customer’s electrical or gas consumption data to a third party that is unaffiliated with, and has no other business relationship with, the electrical or gas corporation, the electrical or gas corporation is not responsible for the security of that data, or its use or misuse.
For purposes of this section, “electrical consumption data” means data about a customer’s electrical usage that is made available as part of an advanced metering infrastructure, and includes the name, account number, or residence of the customer.
A local publicly owned electric utility shall not share, disclose, or otherwise make accessible to any third party a customer’s electrical consumption data, except as provided in subdivision (f) or upon the consent of the customer.
A local publicly owned electric utility shall not sell a customer’s electrical consumption data or any other personally identifiable information for any purpose.
A local publicly owned electric utility or its contractors shall not provide an incentive or discount to the customer for accessing the customer’s electrical consumption data without the prior consent of the customer.
A local publicly owned electric utility that utilizes an advanced metering infrastructure that allows a customer to access the customer’s electrical consumption data shall ensure that the customer has an option to access that data without being required to agree to the sharing of the customer’s personally identifiable information, including electrical consumption data, with a third party.
If a local publicly owned electric utility contracts with a third party for a service that allows a customer to monitor the customer’s electricity usage, and that third party uses the data for a secondary commercial purpose, the contract between the local publicly owned electric utility and the third party shall provide that the third party prominently discloses that secondary commercial purpose to the customer and secures the customer’s consent to the use of the customer’s data for that secondary commercial purpose prior to the use of the data.
A local publicly owned electric utility shall use reasonable security procedures and practices to protect a customer’s unencrypted electrical consumption data from unauthorized access, destruction, use, modification, or disclosure, and to prohibit the use of the data for a secondary commercial purpose not related to the primary purpose of the contract without the customer’s consent.
A local publicly owned electric utility shall not share, disclose, or otherwise make accessible to any immigration authority, as defined in Section 7284.4 of the Government Code, a customer’s electrical consumption data without a court-ordered subpoena or judicial warrant.
This section shall not preclude a local publicly owned electric utility from using customer aggregate electrical consumption data for analysis, reporting, or program management if all information has been removed regarding the individual identity of a customer.
This section shall not preclude a local publicly owned electric utility from disclosing a customer’s electrical consumption data to a third party for system, grid, or operational needs, or the implementation of demand response, energy management, or energy efficiency programs, provided, for contracts entered into after January 1, 2011, that the utility has required by contract that the third party implement and maintain reasonable security procedures and practices appropriate to the nature of the information to protect the personal information from unauthorized access, destruction, use, modification, or disclosure, and prohibits the use of the data for a secondary commercial purpose not related to the primary purpose of the contract without the customer’s prior consent to that use.
Except as provided in subdivision (e), this section shall not preclude a local publicly owned electric utility from disclosing electrical consumption data as required under state or federal law.
If a customer chooses to disclose the customer’s electrical consumption data to a third party that is unaffiliated with, and has no other business relationship with, the local publicly owned electric utility, the utility shall not be responsible for the security of that data, or its use or misuse.
CHAPTER 6. Wildfire Mitigation [8385. - 8389.]
For purposes of this chapter, all of the following definitions apply:
“Deenergization event” means the proactive interruption of electrical service for the purpose of mitigating or avoiding the risk of causing a wildfire.
“Electrical cooperative” has the same meaning as defined in Section 2776.
“Electrical corporation” has the same meaning as defined in Section 218.
“Large electrical corporation” has the same meaning as defined in Section 3280.
“Local publicly owned electric utility” has the same meaning as defined in Section 224.3.
“Office” means the Office of Energy Infrastructure Safety, within the Natural Resources Agency.
Beginning July 1, 2021, the office shall supervise an electrical corporation’s compliance with the requirements of this chapter pursuant to the Public Utilities Act (Part 1 (commencing with Section 201) of Division 1). This chapter does not affect the commission’s authority or jurisdiction over an electrical corporation, electrical cooperative, or local publicly owned electric utility.
Each electrical corporation shall construct, maintain, and operate its electrical lines and equipment in a manner that will minimize the risk of catastrophic wildfire posed by those electrical lines and equipment, taking into account both the time required to implement the proposed mitigation and the amount of risk reduced for the cost and risk remaining.
Each electrical corporation shall submit a wildfire mitigation plan to the office for review at least once every four years. The office shall establish a schedule for the submission of subsequent comprehensive wildfire mitigation plans, which may allow for the staggering of evaluation and performance periods for each electrical corporation.
Beginning January 1, 2027, each electrical corporation shall submit a preliminary wildfire mitigation plan to the office at the earliest date of one year before the filing of its general rate case application or concurrent with the filing of its Risk Assessment Mitigation Phase application with the commission. The wildfire mitigation plan shall cover the same period as the general rate case period.
Paragraph (1) does not apply to independent transmission owners.
The wildfire mitigation plan shall include all of the following:
A description of the preventive strategies and programs to be adopted by the electrical corporation to minimize the risk of its electrical lines and equipment causing catastrophic wildfires, including consideration of dynamic climate change risks.
A description of the metrics the electrical corporation plans to use to measure and track the implementation of the plan and the assumptions that underlie the use of those metrics.
A discussion of how the application of previously identified metrics to previous plan performances has informed the plan.
A description of the electrical corporation’s protocols for disabling reclosers and deenergizing portions of the electrical distribution system that consider the associated impacts on public safety. As part of these protocols, each electrical corporation shall include protocols related to mitigating the public safety impacts of disabling reclosers and deenergizing portions of the electrical distribution system that consider the impacts on all of the following:
Critical first responders.
Health and communication infrastructure.
Customers who receive medical baseline allowances pursuant to subdivision (c) of Section 739. The electrical corporation may deploy backup electrical resources or provide financial assistance for backup electrical resources to a customer receiving a medical baseline allowance for a customer who meets all of the following requirements:
The customer relies on life-support equipment that operates on electricity to sustain life.
The customer demonstrates financial need, including through enrollment in the California Alternate Rates for Energy program continued pursuant to Section 739.1.
The customer is not eligible for backup electrical resources provided through medical services, medical insurance, or community resources.
Subparagraph (C) does not prevent an electrical corporation from deploying backup electrical resources or providing financial assistance for backup electrical resources under any other authority.
A description of the electrical corporation’s appropriate and feasible procedures for notifying a customer who may be impacted by the deenergizing of electrical lines, including procedures for those customers receiving medical baseline allowances as described in paragraph (6). The procedures shall direct notification to all public safety offices, critical first responders, health care facilities, and operators of telecommunications infrastructure with premises within the footprint of potential deenergization for a given event. The procedures shall comply with any orders of the commission regarding notifications of deenergization events.
Identification of circuits that have frequently been deenergized pursuant to a deenergization event to mitigate the risk of wildfire and the measures taken, or planned to be taken, by the electrical corporation to reduce the need for, and impact of, future deenergization of those circuits, including, but not limited to, the estimated annual decline in circuit deenergization and deenergization impact on customers, and replacing, hardening, or undergrounding any portion of the circuit or of upstream transmission or distribution lines.
Plans for vegetation management.
Plans for inspections of the electrical corporation’s electrical infrastructure.
A description of the electrical corporation’s protocols for the deenergization of the electrical corporation’s transmission infrastructure, for instances when the deenergization may impact customers who, or entities that, are dependent upon the infrastructure. The protocols shall comply with any order of the commission regarding deenergization events.
A list that identifies, describes, and prioritizes all wildfire risks, and drivers for those risks, throughout the electrical corporation’s service territory, including all relevant wildfire risk and risk mitigation information that is required by the commission’s risk-based decisionmaking framework established in commission Application 15-05-002 or Rulemaking 20-07-013, or subsequent safety model assessment proceedings, and the Risk Assessment Mitigation Phase filings. The list shall include, but not be limited to, all of the following:
Risks and risk drivers associated with design, construction, operations, and maintenance of the electrical corporation’s equipment and facilities.
Particular risks and risk drivers associated with topographic and climatological risk factors throughout the different parts of the electrical corporation’s service territory.
Particular risks and risk drivers associated with the speed with which wildfire risk mitigation measures can and will be deployed by an electrical corporation within its service territory.
An estimate of cost-per-avoided ignition for each risk, or an explanation on why such a value could not be assigned to a particular risk.
A description of how the plan accounts for the wildfire risk identified in the electrical corporation’s Risk Assessment Mitigation Phase filing, if applicable.
A description of the actions the electrical corporation will take to ensure its system will achieve the highest level of safety, reliability, and resiliency, taking into account the cost and time required to achieve those benefits, and to ensure that its system is prepared for a major event, including hardening and modernizing its infrastructure with improved engineering, system design, standards, equipment, and facilities, such as undergrounding, insulating of distribution wires, and replacing poles. The electrical corporation shall present the cost-efficiency measures adopted by the commission, calculated consistently with the direction provided by the commission’s most recent risk-based decisionmaking framework proceeding, for at least two reasonable mitigation alternatives for a given identified wildfire risk.
A description of where and how the electrical corporation considered undergrounding electrical distribution lines within those areas of its service territory identified to have the highest wildfire risk in a commission fire threat map.
A showing that the electrical corporation has an adequately sized and trained workforce to promptly restore service after a major event, taking into account employees of other utilities pursuant to mutual aid agreements and employees of entities that have entered into contracts with the electrical corporation.
Identification of any geographic area in the electrical corporation’s service territory that is a higher wildfire threat than is currently identified in a commission fire threat map, and where the commission should consider expanding the high fire threat district based on new information or changes in the environment.
A methodology for identifying and presenting enterprisewide safety risk and wildfire-related risk that is consistent with the methodology used by other electrical corporations unless the commission determines otherwise.
A description of how the plan is consistent with the electrical corporation’s disaster and emergency preparedness plan prepared pursuant to Section 768.6, including both of the following:
Plans to prepare for, and to restore service after, a wildfire, including workforce mobilization and prepositioning equipment and employees.
Plans for community outreach and public awareness before, during, and after a wildfire, including language notification in English, Spanish, and the top three primary languages used in the state other than English or Spanish, as determined by the commission based on the United States Census data.
A statement of how the electrical corporation will restore service after a wildfire.
Protocols for compliance with requirements adopted by the commission regarding activities to support customers during and after a wildfire, outage reporting, support for low-income customers, billing adjustments, deposit waivers, extended payment plans, suspension of disconnection and nonpayment fees, repair processing and timing, access to electrical corporation representatives, and emergency communications.
A description of the processes and procedures the electrical corporation will use to do all of the following:
Monitor and audit the implementation of the plan.
Identify any deficiencies in the plan or the plan’s implementation and correct those deficiencies.
Monitor and audit the effectiveness of electrical line and equipment inspections, including inspections performed by contractors, carried out under the plan and other applicable statutes and commission rules.
Any other information that the office may require.
The office shall post all wildfire mitigation plans submitted pursuant to this section on the office’s internet website beginning July 1, 2021, for no less than two months before the office’s decision regarding approval of the plan. The office shall accept comments on each plan from the public, other local and state agencies, and interested parties, and verify that the plan complies with all applicable rules, regulations, and standards, as appropriate.
The commission may assess penalties on an electrical corporation that fails to comply with its plan. In determining an appropriate amount of the penalty, the commission shall consider all of the following:
The nature and severity of any noncompliance, including whether the noncompliance resulted in harm.
The extent to which the commission has found that the electrical corporation failed to comply with its plans in prior years.
Whether the electrical corporation self-reported the circumstances constituting noncompliance.
Whether the electrical corporation implemented corrective actions with respect to the noncompliance.
Whether the electrical corporation knew or in the exercise of reasonable care should have known of the circumstances constituting noncompliance.
Whether the electrical corporation had previously engaged in conduct of a similar nature that caused significant property damage or injury.
Any other factors established by the commission in an order assessing penalties for noncompliance, consistent with this chapter.
The commission shall require a safety culture assessment of each electrical corporation to be conducted by an independent third-party evaluator. The commission shall set the schedule for each assessment, including updates to the assessment at least every five years. The electrical corporation shall not seek reimbursement for the costs of the assessment from ratepayers.
The office shall conduct a wildfire-focused safety culture assessment of each electrical corporation at least once every two years.
The office shall approve or deny each wildfire mitigation plan within nine months of its submission.
Notwithstanding subparagraph (A), for an electrical corporation that is not an independent transmission owner, the wildfire mitigation plan is subject to approval pursuant to Section 8386.4.
The office shall consult with the Office of the State Fire Marshal on the review of each wildfire mitigation plan and update. In rendering its decision, the office shall consider comments submitted pursuant to subdivision(e) of Section 8386. Before approval, the office may require modifications of the plan.
The office may extend any deadlines established pursuant to this subdivision. The decision to extend deadlines shall be made in writing and include reasons supporting the determination that the deadline cannot be met.
An approval of a plan pursuant to this section is not a project as defined in Division 13 (commencing with Section 21000) of the Public Resources Code, provided that environmental review otherwise required by Division 13 (commencing with Section 21000) of the Public Resources Code occurs before any project approval that would authorize physical changes being made to the environment.
Following approval of a wildfire mitigation plan pursuant to subdivision (a) of this section or Section 8386.4, the office shall oversee the implementation of the plan consistent with all of the following:
On or before April 1, 2026, and on or before each April 1 thereafter, each electrical corporation shall file with the office a self-evaluation report addressing the electrical corporation’s implementation of its approved plan during the prior calendar year.
On or before March 1, 2021, and on or before each March 1 thereafter, the office, in consultation with the Office of the State Fire Marshal, shall make available a list of qualified independent evaluators with experience in assessing the safe operation of electrical infrastructure.
Each electrical corporation shall engage an independent evaluator listed pursuant to subparagraph (A) to review and assess the electrical corporation’s implementation of its approved plan. The engaged independent evaluator shall consult with, and operate under the direction of, the office. The independent evaluator shall issue a report on or before July 1 of each year in which a report required by paragraph (1) is filed.
The office shall consider the independent evaluator’s findings, but the independent evaluator’s findings are not binding on the office.
The commission shall authorize the electrical corporation to recover in rates the costs of the independent evaluator.
The office shall complete its performance review of an electrical corporation’s implementation of its plan within 18 months after the submission of the electrical corporation’s self-evaluation report.
Following the end of the performance period, the office may, consistent with its authority pursuant to paragraph (1) of subdivision(b) of Section 15475 of the Government Code, conduct audits of the vegetation management work performed by, or on behalf of, the electrical corporation. The initial audit shall identify deficiencies in the electrical corporation’s implementation of the vegetation management commitments in the wildfire mitigation plan. The office shall provide the initial audit report to the electrical corporation. The electrical corporation shall have a reasonable time, as determined by the office, to respond to and develop corrective actions for any deficiency specified in the initial audit report.
The office may engage its own independent auditor who shall be a certified arborist and shall have any other qualifications determined appropriate by the office, to conduct the audit specified in subparagraph (A). The independent auditor shall consult with, and operate under the direction of, the office.
Following the expiration of the time period for an electrical corporation to respond to and develop corrective actions for any deficiency identified in the initial audit, the office or the independent auditor shall issue an updated audit report to the electrical corporation identifying any outstanding deficiency in the electrical corporation’s implementation or planned corrective actions relative to its vegetation management commitments in the electrical corporation’s wildfire mitigation plan. The report shall be made publicly available. The office shall include, if available, the report in its performance review prepared pursuant to paragraph (4).
Each electrical corporation shall reimburse the office for the office’s costs to implement this section with respect to that electrical corporation.
The date when the electrical corporation projects that it will have spent, or incurred obligations to spend, its entire annual revenue requirement for vegetation management in its wildfire mitigation plan not less than 30 days before that date.
A detailed summary of the electrical corporation’s workforce development efforts completed in compliance with the Office of Federal Contract Compliance Programs, including, but not limited to, all of the following:
A description of and data on the extent to which the electrical corporation advertises job openings to members of California Conservation Corps crews and members of community conservation corps, as defined in Section 14507.5 of the Public Resources Code.
A description of and data on the extent to which the electrical corporation, in seeking to develop potential members of its workforce, has links to or otherwise works with community-based or other organizations that work with current members of California Conservation Corps crews and current members of community conservation corps, as defined in Section 14507.5 of the Public Resources Code, and formerly incarcerated conservation crew members.
A description of the extent to which the electrical corporation supports skill-development efforts that would assist current and former members of California Conservation Corps crews, members of community conservation corps, as defined in Section 14507.5 of the Public Resources Code, formerly incarcerated conservation crew members, and others with similar skillsets in acquiring skills needed to complete work on or near electrical facilities. This clause does not alter the requirements imposed on an employer pursuant to Section 12952 of the Government Code.
An electrical corporation shall provide to the office a copy of the advice letter pursuant to paragraph (1) at the same time the advice letter is submitted to the commission.
This section does not impose any liability on the office regarding the performance of its duties.
The commission shall not allow a large electrical corporation to include in its equity rate base its share, as determined pursuant to the Wildfire Fund allocation metric specified in Section 3280, of the first five billion dollars ($5,000,000,000) expended in aggregate by large electrical corporations on fire risk mitigation capital expenditures included in the electrical corporations’ approved wildfire mitigation plans. An electrical corporation’s share of the fire risk mitigation capital expenditures and the debt financing costs of these fire risk mitigation capital expenditures may be financed through a financing order pursuant to Section 850.1 subject to the requirements of that financing order.
The commission shall consider the cost of implementing each electrical corporation’s plan in its general rate case proceeding and shall approve the costs for wildfire risk mitigation programs and activities it determines are just and reasonable.
In the commission’s discretion, each electrical corporation may establish a memorandum account to track costs incurred for wildfire risk mitigation that are unforeseen and incremental to the wildfire risk mitigation programs and activities authorized in the electrical corporation’s revenue requirements. The commission shall review the costs in the memorandum accounts and disallow recovery of those costs the commission deems unreasonable.
The chief executive officer of an electrical corporation shall certify in each general rate case application that the electrical corporation has not received authorization from the commission to recover the costs in a previous proceeding, including wildfire cost recovery applications.
For a general rate case application filed after January 1, 2027, all of the following apply:
The electrical corporation shall file its preliminary wildfire mitigation plan approved pursuant to subdivision (a) of Section 8386.3, or, if no plan has been approved by the office, the wildfire mitigation plan filed pursuant to subdivision (c) of Section 8386, and any applicable decision from the office, with the general rate case application and shall include testimony establishing the forecast of costs necessary to implement the programs and activities in the plan.
The commission shall consult with the office regarding the programs and activities in the plan in rendering its decision pursuant to paragraph (1) of subdivision (a). The commission’s decision shall constitute approval of the revenue requirement necessary to implement the electrical corporation’s wildfire mitigation plan.
Within 45 days of the commission’s decision rendered pursuant to paragraph (1) of subdivision (a) or any commission order modifying that decision, the electrical corporation shall submit a revised wildfire mitigation plan to the office that conforms to the commission’s revenue authorization. The office shall review and either approve or request modifications to the revised wildfire mitigation plan submitted in accordance with the revenue authorized pursuant to paragraph (1) of subdivision (a). The office shall approve the revised wildfire mitigation plan within two months of submission. After approval by the office, the electrical corporation shall file the approved revised wildfire mitigation plan as an information-only submittal with the commission.
Nothing in this section shall be interpreted as a restriction or limitation on Article 1 (commencing with Section 451) of Chapter 3 of Part 1 of Division 1.
The commission, the office, and the Department of Forestry and Fire Protection shall enter into a memorandum of understanding to cooperatively develop consistent approaches and share data related to fire prevention, safety, vegetation management, and energy distribution systems. The commission, the office, and the department shall share results from various fire prevention activities, including relevant inspections and fire ignition data.
All electrical line clearance tree trimmers performing work to comply with the vegetation management requirements in an electrical corporation’s wildfire mitigation plan shall be qualified line clearance tree trimmers, or trainees under the direct supervision and instruction of qualified line clearance tree trimmers, as provided in the High-Voltage Electrical Safety Orders (Group 2 (commencing with Section 2700) of Subchapter 5 of Chapter 4 of Division 1 of Title 8 of the California Code of Regulations) of the Department of Industrial Relations.
All qualified line clearance tree trimmers shall be paid no less than the prevailing wage rate for a first period apprentice electrical utility lineman as determined by the Director of Industrial Relations.
The commission shall not allow a large electrical corporation to include in its equity rate base its share, as determined pursuant to the allocation specified in paragraph (2) of subdivision (a) of Section 3299.3, of the six billion dollars ($6,000,000,000) that the large electrical corporations collectively first expend on fire risk mitigation capital expenditures approved by the commission on or after January 1, 2026. These amounts are in addition to the amounts the large electrical corporations shall not include in their equity rate base pursuant to subdivision (e) of Section 8386.3. An electrical corporation’s share of the fire risk mitigation capital expenditures and the debt financing costs of these fire risk mitigation capital expenditures may be financed through a financing order pursuant to Section 850.1, subject to the requirements of that financing order.
Subdivision (a) does not apply to an expenditure made after December 31, 2035.
Each local publicly owned electric utility and electrical cooperative shall construct, maintain, and operate its electrical lines and equipment in a manner that will minimize the risk of wildfire posed by those electrical lines and equipment.
The local publicly owned electric utility or electrical cooperative shall, before January 1, 2020, prepare a wildfire mitigation plan. After January 1, 2026, a local publicly owned electric utility or electrical cooperative shall prepare a wildfire mitigation plan and shall submit the plan to the California Wildfire Safety Advisory Board at least once every four years on a schedule determined by the California Wildfire Safety Advisory Board.
The wildfire mitigation plan shall consider as necessary, at minimum, all of the following:
An accounting of the responsibilities of persons responsible for executing the plan.
The objectives of the wildfire mitigation plan.
A description of the preventive strategies and programs to be adopted by the local publicly owned electric utility or electrical cooperative to minimize the risk of its electrical lines and equipment causing catastrophic wildfires, including consideration of dynamic climate change risks.
A description of the metrics the local publicly owned electric utility or electrical cooperative plans to use to measure and track the implementation of the plan and the assumptions that underlie the use of those metrics.
A discussion of how the application of previously identified metrics to previous wildfire mitigation plan performances has informed the wildfire mitigation plan.
Protocols for disabling reclosers and deenergizing portions of the electrical distribution system that consider the associated impacts on public safety, and protocols related to mitigating the public safety impacts of those protocols, including impacts on critical first responders and on health and communication infrastructure.
Appropriate and feasible procedures for notifying a customer who may be impacted by the deenergizing of electrical lines. The procedures shall direct notification to all public safety offices, critical first responders, health care facilities, and operators of telecommunications infrastructure with premises within the footprint of potential deenergization for a given event.
Plans for vegetation management.
Plans for inspections of the local publicly owned electric utility’s or electrical cooperative’s electrical infrastructure.
A list that identifies, describes, and prioritizes all wildfire risks, and drivers for those risks, throughout the local publicly owned electric utility’s or electrical cooperative’s service territory. The list shall include, but not be limited to, both of the following:
Risks and risk drivers associated with design, construction, operation, and maintenance of the local publicly owned electric utility’s or electrical cooperative’s equipment and facilities.
Particular risks and risk drivers associated with topographic and climatological risk factors throughout the different parts of the local publicly owned electric utility’s or electrical cooperative’s service territory.
Identification of any geographic area in the local publicly owned electric utility’s or electrical cooperative’s service territory that is a higher wildfire threat than is identified in a commission fire threat map, and identification of where the commission should expand a high fire-threat district based on new information or changes to the environment.
A methodology for identifying and presenting enterprisewide safety risk and wildfire-related risk.
A statement of how the local publicly owned electric utility or electrical cooperative will restore service after a wildfire.
A description of the processes and procedures the local publicly owned electric utility or electrical cooperative shall use to do all of the following:
Monitor and audit the implementation of the wildfire mitigation plan.
Identify any deficiencies in the wildfire mitigation plan or its implementation, and correct those deficiencies.
Monitor and audit the effectiveness of electrical line and equipment inspections, including inspections performed by contractors, that are carried out under the plan, other applicable statutes, or commission rules.
In each year it is required to submit a plan, the local publicly owned electric utility or electrical cooperative shall present its wildfire mitigation plan in an appropriately noticed public meeting. The local publicly owned electric utility or electrical cooperative shall accept comments on its wildfire mitigation plan from the public, other local and state agencies, and interested parties, and shall verify that the wildfire mitigation plan complies with all applicable rules, regulations, and standards, as appropriate.
The local publicly owned electric utility or electrical cooperative shall contract with a qualified independent evaluator with experience in assessing the safe operation of electrical infrastructure to review and assess the comprehensiveness of its wildfire mitigation plan. The independent evaluator shall issue a report that shall be made available on the internet website of the local publicly owned electric utility or electrical cooperative, and shall present the report at a public meeting of the local publicly owned electric utility’s or electrical cooperative’s governing board.
An electrical corporation, local publicly owned electric utility, or community choice aggregator with a contract to procure electricity generated from biomass pursuant to Section 399.20.3, commission Resolution E-4770 (March 17, 2016), or commission Resolution E-4805 (October 13, 2016), that expires on or before December 31, 2028, shall seek to amend the contract to include, or seek approval for a new contract that includes, an expiration date at least five years later than the expiration date in the contract that was operative in 2022 if the contract extension follows the feedstock requirement of subdivision (b) of Section 399.20.3.
Except as provided in paragraph (2), subdivision (a) does not apply to a facility located in a federal severe or extreme nonattainment area for particulate matter or ozone.
Notwithstanding paragraph (1), subdivision (a) applies to a facility in an area that voluntarily opts for severe or extreme nonattainment status but the air district has determined that the continued operation of the facility does not impede the air district’s ability to meet its applicable attainment deadline.
A contract between an electrical corporation, local publicly owned electric utility, or community choice aggregator and a biomass generator that is located in the Sacramento federal ozone nonattainment area shall not be extended unless the biomass generator first obtains a letter or certificate from the air district with jurisdiction over the biomass generator that states that the Sacramento federal ozone nonattainment area voluntarily opted to be classified in one or more federal standards in a severe or extreme nonattainment zone and that the continued operation of the facility does not impede the air district’s ability to meet its applicable requirements.
The commission shall establish an expedited utility distribution infrastructure undergrounding program consistent with this section.
Only a large electrical corporation may participate in the program.
In order to participate in the program, a large electrical corporation shall submit to the office a distribution infrastructure undergrounding plan that shall address or include, at minimum, all of the following components:
A 10-year plan for undergrounding distribution infrastructure.
Identification of the undergrounding projects that will be constructed as part of the program, including a means of prioritizing undergrounding projects based on wildfire risk reduction, public safety, cost efficiency, and reliability benefits. Only undergrounding projects located in tier 2 or 3 high fire-threat districts or rebuild areas may be considered and constructed as part of the program.
Timelines for the completion of identified and prioritized undergrounding projects, and unit cost targets and mileage completion targets for each year covered by the plan.
A comparison of undergrounding versus aboveground hardening of electrical infrastructure and wildfire mitigation for achieving comparable risk reduction, or any other alternative mitigation strategy, such as covered conductor and rapid earth fault current limiter devices, for those prioritized undergrounding projects, evaluating the scope, cost, extent, and risk reduction of each activity, separately and collectively, over the duration of the plan. The comparison shall emphasize risk reduction and include an analysis of the cost of each activity for reducing wildfire risk, separately and collectively, over the duration of the plan.
A plan for utility and contractor workforce development.
An evaluation of project costs, projected economic benefits over the life of the assets, and any cost containment assumptions, including the economies of scale necessary to reduce wildfire risk and mitigation costs and establish a sustainable supply chain.
Upon a large electrical corporation submitting a plan to the office, the office shall do both of the following:
Upon the office approving a plan pursuant to paragraph (2) of subdivision (d), the large electrical corporation shall, within 60 days, submit to the commission a copy of the plan and an application requesting review and conditional approval of the plan’s costs and including all of the following:
Any substantial improvements in safety risk and reduction in costs compared to other hardening and risk mitigation measures over the duration of the plan.
The cost targets, at a minimum, that result in feasible and attainable cost reductions as compared to the large electrical corporation’s historical undergrounding costs.
How the cost targets are expected to decline over time due to cost efficiencies and economies of scale.
A strategy for achieving cost reductions over time.
The assigned commissioner may waive the requirements of subdivisions (b), (d), (f), and (i) of Section 1701.3 for an application submitted to the commission pursuant to paragraph (1).
In reviewing an application submitted to the commission pursuant to paragraph (1), the commission shall consider not revisiting cost or mileage completion targets approved, or pending approval, in the electrical corporation’s general rate case or a commission-approved balancing account ratemaking mechanism for system hardening.
Upon the commission receiving an application pursuant to paragraph (1), the commission shall facilitate a public workshop for presentation of the plan and take public comment for at least 30 days.
On or before nine months, the commission shall review and approve or deny the application. Before approving the application, the commission may require the large electrical corporation to modify or modify and resubmit the application.
The commission shall consider continuing an existing commission-approved balancing account ratemaking mechanism for system hardening for the duration of a plan, as determined by the commission, and shall authorize recovery of recorded costs that are determined to be just and reasonable.
If the plan is approved by the office and commission, the large electrical corporation shall do all of the following:
Every six months, file a progress report with the office and the commission. The large electrical corporation and the office shall publish these progress reports on their internet websites.
Include ongoing work plans and progress in wildfire mitigation plan filings.
Hire an independent monitor, selected by the office, to review and assess the large electrical corporation’s adherence to its plan and submit a report with the office each December 1 over the course of the plan.
In reviewing and assessing the large electrical corporation’s adherence to its plan pursuant to paragraph (3) of subdivision (f), the independent monitor shall assess whether the large electrical corporation’s progress on undergrounding work has been consistent with the objectives identified in its plan. The independent monitor’s report shall specify any failure, delays, or shortcomings of the large electrical corporation and provide recommendations for improvements to accomplish the objectives set forth in the plan.
The large electrical corporation shall have 180 days to correct and eliminate any deficiency specified in the independent monitor’s report.
On or before December 1 of each year the plan is in effect, the independent monitor shall submit the report to the office.
The office shall publish reports received pursuant to paragraph (3) of subdivision (g) on its internet website.
The office shall consider the independent monitor’s report and whether the large electrical corporation has cured any deficiencies, and may provide an assessment to the commission for consideration.
The commission may assess penalties on a large electrical corporation that fails to comply with a commission decision approving its plan.
Each large electrical corporation participating in the program shall apply for available federal, state, and other nonratepayer moneys throughout the duration of its approved undergrounding plan, and any moneys received as a result of those applications shall be used to reduce the program’s costs on the large electrical corporation’s ratepayers.
An approval of a plan pursuant to this section is not a project as defined in Division 13 (commencing with Section 21000) of the Public Resources Code, provided that environmental review otherwise required by Division 13 (commencing with Section 21000) of the Public Resources Code occurs before any project approval that would authorize physical changes being made to the environment.
The Director of the Office of Energy Infrastructure Safety shall issue a certificate to an electrical corporation if the electrical corporation provides documentation of the following:
The electrical corporation has an approved wildfire mitigation plan pursuant to subdivision (a) of Section 8386.3.
The electrical corporation has agreed to implement the recommendations of its most recent safety culture assessments performed pursuant to Section 8386.2, if applicable.
The electrical corporation has established a safety committee of its board of directors composed of members with relevant safety experience.
The electrical corporation has established an executive incentive compensation structure approved by the office and structured to promote safety as a priority and to ensure public safety and utility financial stability with performance metrics, including incentive compensation based on meeting performance metrics that are measurable and enforceable, for all executive officers, as defined in Section 451.5. This may include tying 100 percent of incentive compensation to safety performance and denying all incentive compensation in the event the electrical corporation causes a catastrophic wildfire that results in one or more fatalities.
The electrical corporation has established board-of-director-level reporting to the commission and office on safety issues.
The electrical corporation has established a compensation structure for any new or amended contracts, plans, or arrangements, whether written or unwritten, for executive officers, as defined in Section 451.5, that is based on the following principles:
Strict limits on guaranteed cash compensation, with the primary portion of the executive officers’ compensation based on achievement of objective performance metrics.
(II) No guaranteed monetary incentives in the compensation structure.
It satisfies the compensation principles identified in paragraph (4).
A long-term structure that provides a significant portion of compensation, which may take the form of grants of the electrical corporation’s stock, based on the electrical corporation’s long-term performance and value. This compensation shall be held or deferred for a period of at least three years.
Minimization or elimination of indirect or ancillary compensation that is not aligned with shareholder and taxpayer interest in the electrical corporation.
The office shall approve the compensation structure of an electrical corporation if it determines the structure meets the principles set forth in subparagraph (A) and paragraph (4).
It is the intent of the Legislature, in enacting this paragraph and paragraph (4), that any approved bankruptcy reorganization plan of an electrical corporation should, in regards to compensation for executive officers of the electrical corporation, comply with the requirements of those paragraphs.
The electrical corporation is implementing the mitigation strategies in its approved wildfire mitigation plan. The electrical corporation shall file a notification of implementation of its wildfire mitigation plan with the office and an information-only submittal with the commission on a quarterly basis that details the implementation of both its approved wildfire mitigation plan and recommendations of the most recent safety culture assessments by the commission and office, and a statement of the recommendations of the board of directors safety committee meetings that occurred during the quarter. The notification and information-only submittal shall also summarize the implementation of the safety committee recommendations from the electrical corporation’s previous notification and submission. If the office has reason to doubt the veracity of the statements contained in the notification or information-only submittal, it shall perform an audit of the issue of concern. The electrical corporation shall provide a copy of the information-only submittal to the office.
A certificate shall be valid for the 12 consecutive months following the issuance of the certificate.
Before the expiration of a certificate, an electrical corporation shall submit to the office a request for a certificate for the following 12 months. The office shall issue a certificate within 90 days of a request if the electrical corporation has provided documentation that it has satisfied the requirements in subdivision (a).
The office may, for good cause, in writing, extend the 90-day period.
All documents submitted pursuant to this section shall be publicly available on the commission’s and the office’s internet websites.
Notwithstanding paragraph (1), a certificate shall remain valid until the office acts on the electrical corporation’s pending request for a certificate.
The office may extend the expiration date of a certificate if the office or the commission has not yet acted on an element of the certificate request required pursuant to subdivision (a).
CHAPTER 7. Designated Water System Administration [8390. - 8390.]
A privately owned public utility may serve as an administrator for purposes of Section 116686 of the Health and Safety Code.
CHAPTER 9. Electrical, Gas, Sewer, and Water Service for New Housing Construction [8400. - 8401.]
As used in this chapter, “utility” means any of the following that furnish electrical, gas, water, or sewer service, or any combination thereof, where the service is performed for, or the commodity is delivered to, the public or any portion thereof:
An electrical corporation, as defined in Section 218.
A gas corporation, as defined in Section 222.
A sewer system corporation, as defined in Section 230.6.
A water corporation, as defined in Section 241.
A municipality or municipal corporation operating as a public utility pursuant to Division 5 (commencing with Section 10001).
A municipal utility district formed pursuant to the Municipal Utility District Act (Division 6 (commencing with Section 11501)).
A public utility district formed pursuant to The Public Utility District Act (Division 7 (commencing with Section 15501)).
An irrigation district formed pursuant to the Irrigation District Law (Division 11 (commencing with Section 20500) of the Water Code).
A joint powers authority that includes one or more of the entities described in subdivisions (e) to (h), inclusive, and that owns electrical, gas, water, or sewer facilities, or furnishes electrical, gas, water, or sewer service over its own or its member’s system.
On or before January 1, 2026, for new housing construction, each utility shall publicly post both of the following on its internet website:
A schedule of estimated fees for typical service connections for each housing development type, including, but not limited to, accessory dwelling unit, multifamily, mixed-use, and single-family developments. This paragraph does not apply to a utility that continues to post a schedule of their fees with this information pursuant to Section 65940.1 of the Government Code.
The estimated timeframes for completing typical service connections needed for each housing development type, including, but not limited to, accessory dwelling unit, mixed-use, multifamily, and single-family developments.
This section does not apply to a utility with fewer than 4,000 service connections that does not establish or maintain an internet website due to a hardship.
The utility may establish that a hardship exists by annually adopting a resolution that includes detailed findings based on evidence that is publicly noticed before the meeting and included in the meeting agenda that supports the determination that a hardship prevents the utility from establishing or maintaining an internet website. The findings may include, but shall not be limited to, inadequate access to broadband communications network facilities that enable high-speed internet access, significantly limited financial resources, or insufficient staff resources.
CHAPTER 10. Information Sharing [8410. - 8412.]
For purposes of this chapter, all of the following definitions apply:
“Electrical corporation” has the same meaning as defined in Section 218.
“Local publicly owned electric utility” has the same meaning as defined in Section 224.3.
The commission, as it deems necessary for the exchange of aggregated data, may establish any memoranda of understanding or other agreements necessary to direct electrical corporations to timely provide data to the State Department of Social Services to maximize the food assistance available pursuant to Section 18917.2 of the Welfare and Institutions Code.
The data provided pursuant to the memoranda of understanding or other agreements shall meet, at minimum, all of the following requirements and prohibitions:
The provided data shall be limited to only the aggregated customer outage data at the ZIP Code level that is necessary for the State Department of Social Services to maximize food assistance in an emergency, and shall not include any personally identifiable information.
The provided data shall not be used for any purposes other than those specified in this section and Section 18917.2 of the Welfare and Institutions Code.
The provided data shall be subject to all applicable privacy laws.
Notwithstanding any other law, or the execution of any memoranda of understanding or other agreements, each electrical corporation shall, within seven calendar days, make a reasonable effort to provide aggregated customer outage data, for outages of four hours or longer, in response to a request for data by the State Department of Social Services in order to maximize the food assistance available pursuant to Section 18917.2 of the Welfare and Institutions Code.
Data provided to the State Department of Social Services shall meet, at minimum, all of the following requirements and prohibitions:
The provided data shall be limited to only the aggregated customer outage data at the ZIP Code level that is necessary for the State Department of Social Services to maximize food assistance in an emergency, and shall not include any personally identifiable information.
The provided data shall include, but not be limited to, the dates of power outages, duration in hours of power outages, the counties affected by power outages, the ZIP Codes affected by power outages, and, for each affected ZIP Code, the total number of residential customers in the ZIP Code and the total number of residential customers who lost electrical service during the power outages.
The provided data shall not be used for any purposes other than those specified in this section and Section 18917.2 of the Welfare and Institutions Code.
The provided data shall be subject to all applicable privacy laws.
Each electrical corporation shall have a dedicated point of contact for the State Department of Social Services necessary to provide the data requested pursuant to subdivisions (a) and (b).
The commission shall provide technical assistance to the State Department of Social Services, including, but not limited to, technical assistance to support the report described in Section 18917.2 of the Welfare and Institutions Code.
The governing board of each local publicly owned electric utility, as it deems necessary for the exchange of aggregated data, may establish any memoranda of understanding or other agreements necessary to direct the local publicly owned electric utility to timely provide data to the State Department of Social Services to maximize the food assistance available pursuant to Section 18917.2 of the Welfare and Institutions Code.
The data provided pursuant to the memoranda of understanding or other agreements shall meet, at minimum, all of the following requirements and prohibitions:
The provided data shall be limited to only the aggregated customer outage data at the ZIP Code level that is necessary for the State Department of Social Services to maximize food assistance in an emergency, and shall not include any personally identifiable information.
The provided data shall not be used for any purposes other than those specified in this section and Section 18917.2 of the Welfare and Institutions Code.
The provided data shall be subject to all applicable privacy laws.
Notwithstanding any other law or the execution of any memoranda of understanding or other agreements, each local publicly owned electric utility shall, within seven calendar days, make a reasonable effort to provide aggregated customer outage data, for outages of four hours or longer, in response to a request for data by the State Department of Social Services in order to maximize the food assistance available pursuant to Section 18917.2 of the Welfare and Institutions Code.
Data provided to the State Department of Social Services shall meet, at minimum, all of the following requirements and prohibitions:
The provided data shall be limited to only the aggregated customer outage data at the ZIP Code level that is necessary for the State Department of Social Services to maximize food assistance in an emergency, and shall not include any personally identifiable information.
The provided data shall include, but not be limited to, the dates of power outages, duration in hours of power outages, the counties affected by power outages, the ZIP Codes affected by power outages, and, for each affected ZIP Code, the total number of residential customers in the ZIP Code and the total number of residential customers who lost electrical service during power outages.
The provided data shall not be used for any purposes other than those specified in this section and Section 18917.2 of the Welfare and Institutions Code.
The provided data shall be subject to all applicable privacy laws.
Each local publicly owned electric utility shall designate a point of contact for the State Department of Social Services necessary to provide the data requested pursuant to subdivisions (a) and (b).
The State Department of Social Services shall notify each local publicly owned electric utility of any changes to the federal requirements in a timely manner.
CHAPTER 10. Energy Storage Systems [8500. - 8504.]
For purposes of this chapter, both of the following definitions apply:
“Energy storage system” means a stationary electrical energy storage system, as defined in Chapter 12 (commencing with Section 1201) of Part 9 of the California Building Standards Code (Title 24 of the California Code of Regulations), that is capable of storing 10 megawatthours or more of energy.
“Local jurisdiction” means a city, county, or city and county.
An application submitted to a local jurisdiction for an energy storage system shall include the applicant’s certification that,
at least 30 days before submitting the application, the applicant met and conferred with the authority that has jurisdiction over fire suppression in the area where the energy storage system is proposed and discussed the energy storage system design, sought input on mitigating potential fire and life safety concerns, and sought input on the content of emergency action plans required by Section 761.3 of the Public Utilities Code. The application shall include documentation of this consultation, including the date, the names and titles of participants, a summary of fire safety matters discussed, and a description of how the application addresses those matters.
For any application submitted after January 1, 2026, a local jurisdiction shall not approve an energy storage system, unless the local jurisdiction requires, as a condition of
approval, that after installation is complete, but before commencing operations or use of the batteries, the energy storage system is inspected by the respective authorities having jurisdiction, including the authority that has jurisdiction over fire suppression. The applicant shall bear the cost of the inspections. The inspector shall be provided a copy of the documentation of the initial fire official consultation submitted with the application pursuant to Section 8501.
For purposes of this section, all of the following definitions apply:
“Dedicated-use building” has the same meaning as defined in the California Building Standards Code (Title 24 of the California Code of Regulations).
“Noncombustible building” means a building that meets the Type I building requirements set forth in the California Building Standards Code (Title 24 of the California Code of Regulations).
“Outdoor installation” means an energy storage system that is regulated by the California Building Standards Code (Title 24 of the California Code of Regulations).
As part of the next update to the California Building Standards Code considered after July 1, 2026, the Office of the State Fire Marshal shall review and consider proposing provisions that restrict the location of energy storage systems to dedicated-use noncombustible buildings or outdoor installations.
In the review and consideration of limiting the use of indoor installations of energy storage systems pursuant to subdivision (b), the Office of the State Fire Marshal shall consider proposing provisions that are consistent with the efforts of the office to ensure the safe construction, installation, commission, operation, maintenance, and decommission of energy storage systems.
The provisions considered pursuant to paragraph (1) shall only pertain to fire and life safety considered in the California Building Standards Code development process and shall not limit the commission’s general oversight of energy storage systems.
As part of the review pursuant to subdivision (b), the State Fire Marshal may consider different requirements for battery technologies with different flammability and risk profiles.
This section shall remain in effect only until January 1 2029, and as of that date is repealed.
This chapter does not prevent a local jurisdiction from adopting and enforcing laws consistent with or more protective than this chapter.
CHAPTER 15. Customer Communications [8550. - 8550.]
Except as provided in subdivision (b), each utility shall, on or before March 1, 2026, automatically enroll its customers in alerts for service outages and updates.
A local publicly owned electric utility that does not have the necessary system to implement the requirements of subdivision (a) shall, on or before March 1, 2026, develop appropriate and feasible procedures to maximize the automatic enrollment of its customers in alerts for electrical service outages and updates.
A local publicly owned electric utility that does not have the necessary system to implement the requirements of subdivision (a) shall, on or before March 1, 2028, develop a plan to update its system to automatically enroll its customers in alerts for electrical service outages and updates.
If the governing board of the local publicly owned electric utility determines the plan developed pursuant to subparagraph (A) is cost effective, the local publicly owned electric utility shall implement the plan during the next significant, planned upgrade of its system or by March 1, 2030, whichever is sooner.
Customers shall be provided with the opportunity to opt-out of alerts for service outages and updates that the customer does not wish to receive, except for required or essential notifications.
Each utility shall annually provide information on a customer’s bill on how to update the customer’s preferred contact method and shall allow a customer to update the customer’s contact information on the utility’s internet website or, if feasible, by telephone.
DIVISION 4.8. PUBLICLY OWNED UTILITIES [9500. - 9520.]
PART 1. Low-Income Weatherization Programs [9500. - 9508.5.]
Each publicly owned electric and gas utility that provides the energy for space heating for low-income customers shall also provide home weatherization services for those customers if a significant need for those services exists in the utility’s service territory, as determined by the utility, taking into consideration both the cost-effectiveness of the services and the public policy of reducing financial hardships facing low-income households. Publicly owned utilities shall not have to duplicate low-income home weatherization services provided by gas and electrical corporations serving the same service territory.
For purposes of this section, “weatherization” includes, where feasible, any of the following measures for any dwelling unit:
Attic insulation.
Caulking.
Weatherstripping.
Low flow showerhead.
Waterheater blanket.
Door and building envelope repairs which reduce air infiltration.
Each publicly owned electric and gas utility shall provide as many of these measures as it determines to be feasible and cost-effective for each eligible low-income dwelling unit.
“Weatherization” may also include other building conservation measures, energy-efficient appliances, and energy education programs determined by the utility to be feasible, taking into consideration both the cost-effectiveness of the measures and the public policy of reducing the financial hardships facing low-income households.
Each publicly owned electric and gas utility shall develop and implement its low-income home weatherization program, in consultation with gas and electrical corporations and the Department of Economic Opportunity, to avoid duplication and to ensure the most efficient use of public and private resources. For ratemaking purposes, gas and electrical corporation expenditures for consultation and coordination shall be recoverable from ratepayers, subject to the Public Utilities Commission’s authority to determine the reasonableness of the amount of the expenditures.
Upon the completion and promulgation of regulations pursuant to subdivision (a) of Section 25943 of the Public Resources Code, each governing body of a local publicly owned electric utility, as defined in Section 224.3, shall be responsible for implementing an energy efficiency program that recognizes the intent of the Legislature to encourage energy savings and greenhouse gas emission reductions in existing residential and nonresidential buildings, while taking into consideration the effect of the program on rates, reliability, and financial resources.
By March 15, 2013, and by March 15 of each year thereafter, each local publicly owned electric utility shall report to the Energy Commission and to its customers all of the following:
Its investments in energy efficiency and demand reduction programs.
A description of each energy efficiency and demand reduction program, program expenditures, the cost-effectiveness of each program, and expected and actual energy efficiency savings and demand reduction results that reflect the intent of the Legislature to encourage energy savings and reductions in emissions of greenhouse gases resulting from providing service to existing residential and nonresidential buildings, while taking into consideration the effect of the program on rates, reliability, and financial resources.
The sources for funding of its energy efficiency and demand reduction programs.
The methodologies and input assumptions used to determine the cost-effectiveness of its energy efficiency and demand reduction programs.
A comparison of the local publicly owned electric utility’s annual targets established pursuant to subdivision (b) and the local publicly owned electric utility’s reported electricity efficiency savings and demand reductions.
By March 15, 2013, and by March 15 of every fourth year thereafter, each local publicly owned electric utility shall identify all potentially achievable cost-effective electricity efficiency savings and shall establish annual targets for energy efficiency savings and demand reduction for the next 10-year period, consistent with the annual targets established by the Energy Commission pursuant to subdivision (c) of Section 25310 of the Public Resources Code. A local publicly owned electric utility’s determination of potentially achievable cost-effective electricity efficiency savings shall be made without regard to previous minimum investments undertaken pursuant to Section 385. A local publicly owned electric utility shall treat investments made to achieve energy efficiency savings and demand reduction targets as procurement investments.
Within 60 days of establishing annual targets pursuant to subdivision (b), each local publicly owned electric utility shall report those targets to the Energy Commission, and the basis for establishing those targets.
Each local publicly owned electric utility shall make available to its customers and to the Energy Commission the results of any independent evaluation that measures and verifies the energy efficiency savings and the reduction in energy demand achieved by its energy efficiency and demand reduction programs.
A local publicly owned electric utility shall report to the Energy Commission regarding the energy storage system procurement targets and policies adopted by the governing board pursuant to paragraph (2) of, and report any modifications made to those targets as a result of a reevaluation undertaken pursuant to paragraph (3) of subdivision (b) of Section 2836.
By January 1, 2017, a local publicly owned electric utility shall submit a report to the Energy Commission demonstrating that it has complied with the energy storage system procurement targets and policies adopted by the governing board pursuant to subdivision (b) of Section 2836.
By January 1, 2021, a local publicly owned electric utility shall submit a report to the Energy Commission demonstrating that it has complied with the energy storage system procurement targets and policies adopted by the governing board pursuant to subdivision (b) of Section 2836.
The Energy Commission shall ensure that a copy of each report or plan required by subdivisions (b) and (c), with any confidential information redacted, is available on the Energy Commission’s Internet Web site, or on an Internet Web site maintained by the local publicly owned electric utility that can be accessed from the Energy Commission’s Internet Web site.
A summary of the reports required by this section shall be included as part of each integrated energy policy report required pursuant to Section 25302 of the Public Resources Code.
For purposes of this section, “eligible renewable energy resource” and “renewables portfolio standard” have the same meanings as for the California Renewables Portfolio Standard Program (Article 16 (commencing with Section 399.11) of Chapter 2.3 of Part 1 of Division 1).
Every local publicly owned electric utility shall annually disclose, to end-use customers, all of the following:
Its electricity sources for the previous calendar year, consistent with information provided to the Energy Commission pursuant to Section 398.4.
The utility’s progress toward attaining the renewables portfolio standard established pursuant to Section 399.30.
Expenditures for development of eligible renewable energy resources, including a description of programs, sources of funding, expected results, and actual results.
A local publicly owned electric utility shall, on an annual basis, make available to its customers information relating to the utility’s solar initiative program established pursuant to Section 2854, including the rated generating capacity of installed solar energy systems receiving monetary incentives through the utility’s program, the total number of solar energy systems installed, the total number of applications for the utility’s program, the amount of monetary incentives awarded, and the contribution toward the program goals of the California Solar Initiative (Article 1 (commencing with Section 2851) of Chapter 9 of Part 2 of Division 1).
In developing the rules and procedures specified in this section and in Section 9507, the Energy Commission shall seek to minimize the reporting burden and cost of reporting that it imposes on local publicly owned electric utilities.
A local publicly owned electric utility shall annually submit to the Energy Commission documentation regarding eligible renewable energy resources procurement contracts that it executed during the prior year, as follows:
A description of the eligible renewable energy resource, including the duration of the contract or electricity purchase agreement.
A description and identification of the electrical generating facility providing the eligible renewable energy resource under the contract.
An estimate of the percentage increase in the utility’s total retail sales of electricity from eligible renewable energy resources that will result from the contract.
A local publicly owned electric utility shall annually submit to the Energy Commission documentation regarding the utility’s progress toward attaining the renewables portfolio standard established pursuant to Section 399.30.
A local publicly owned electric utility shall, on an annual basis, make available to the Legislature and the Energy Commission information relating to the utility’s solar initiative program established pursuant to Section 2854, including the rated generating capacity of installed solar energy systems receiving monetary incentives through the utility’s program, the total number of solar energy systems installed, the total number of applications for the utility’s program, the amount of monetary incentives awarded, and the contribution toward the program goals of the California Solar Initiative (Article 1 (commencing with Section 2851) of Chapter 9 of Part 2 of Division 1).
For the purposes of this section, “eligible renewable energy resource,” “renewables portfolio standard,” and “procure” have the same meanings as these terms have in the California Renewables Portfolio Standard Program (Article 16 (commencing with Section 399.11) of Chapter 2.3 of Part 1 of Division 1).
A local publicly owned electric utility serving end-use customers shall, upon request, provide the Energy Commission with any information the Energy Commission determines is necessary to evaluate the progress made by the local publicly owned electric utility in meeting the requirements of Section 9620.
PART 2. Utility Poles and Support Structures [9510. - 9520.]
The Legislature finds and declares that in order to promote wireline and wireless broadband access and adoption, it is in the interest of the state to ensure that local publicly owned electric utilities, including irrigation districts, that own or control utility poles and support structures, including ducts and conduits, make available appropriate space and capacity on and in those structures to cable television corporations, video service providers, and telephone corporations under reasonable rates, terms, and conditions.
The Legislature further finds and declares that the oversight of fees and other requirements imposed by local publicly owned electric utilities as a condition of providing the space or capacity described in subdivision (a) is a matter of statewide interest and concern. Therefore, it is the intent of the Legislature that this part supersedes all conflicting local laws and this part shall apply in charter cities.
The Legislature further finds and declares that local publicly owned electric utilities should provide access to utility poles and support structures with a recovery of actual costs without subsidizing for-profit cable television corporations, video service providers, and telephone corporations.
As used in this part, the following terms have the following meanings:
“Communications service provider” means a cable television corporation, video service provider, or telephone corporation.
“Governing body” means the governing body of a local publicly owned electric utility, including, where applicable, a board appointed by a city council.
“Street light pole” means a pole, arm, or fixture used primarily for street, pedestrian, or security lighting.
“Utility pole” means an electricity or telephone pole, but does not include a street light pole or an electricity pole used solely for the transmission of electricity at 50 kilovolts or higher and not intended for distribution of communications signals or electricity at lower voltages.
A local publicly owned electric utility shall make appropriate space and capacity on and in a utility pole and support structure owned or controlled by the local publicly owned electric utility available for use by a communications service provider pursuant to reasonable terms and conditions. Rates, terms, and conditions that are specified in a contract executed before January 1, 2012, shall remain valid until the contract, rate, term, or condition expires or is terminated according to its terms by one of the parties. If an annual fee is included in a contract executed before January 1, 2012, but the amount of the fee is left unspecified, the requirements of Section 9512 apply.
A local publicly owned electric utility shall respond to a request for use by a communications service provider of a utility pole or support structure owned or controlled by the local publicly owned electric utility within 45 days of the date of receipt of the request, or 60 days if the request is to attach to over 300 poles. If the request is denied, the local publicly owned electric utility shall provide in the response the reason for the denial and the remedy to gain access to the utility pole or support structure. If a request to attach is accepted, the local publicly owned electric utility, within 14 days after acceptance of the request, shall provide a cost estimate, based on actual cost, for any necessary make-ready work required to accommodate the attachment. The requesting party shall accept or reject the make-ready cost estimate within 14 days. Within 60 days of acceptance of the cost estimate, the local publicly owned electric utility shall notify any existing third-party attachers that make-ready work for a new attacher needs to be performed. The requesting party shall have the responsibility to coordinate with third-party existing attachers for make-ready work to be completed. All parties shall complete all make-ready work within 60 days of the notice, or within 105 days in the case of a request to attach to over 300 poles. The local publicly owned electric utility may complete make-ready work without the consent of the existing attachers, if the existing attachers fail to move their attachments by the end of the make-ready timeline requirements specified in this paragraph.
The timelines described in paragraph (1) may be extended under special circumstances upon agreement of the local publicly owned electric utility and the communications service provider.
A local publicly owned electric utility may deny an application for use of a utility pole or support structure because of insufficient capacity or safety, reliability, or engineering concerns. In denying an application, a local publicly owned electric utility may also take into account the manner in which a request from a communications service provider under this part could impact an approved project for future use by the local publicly owned electric utility of its utility poles or support structures for delivery of its core utility service.
This part does not limit the authority of a local publicly owned electric utility to ensure compliance with all applicable provisions of law in determining whether to approve or disapprove use of a utility pole or support structure.
If a local publicly owned electric utility has the authority pursuant to other law to impose a fee to provide the use described in Section 9511, that fee shall be adopted and levied consistent with the requirements of this part.
The governing body of the local publicly owned electric utility shall determine the fee pursuant to Section 9512.
This part does not grant additional authority to a local publicly owned electric utility to impose a fee that is not otherwise authorized by law.
An annual fee charged by a local publicly owned electric utility for the use of a utility pole by a communications service provider shall not exceed an amount determined by multiplying the percentage of the total usable space that would be occupied by the attachment by the annual costs of ownership of the pole and its supporting anchor. As used in this paragraph and paragraph (2), “usable space” means the space above the minimum grade level that can be used for the attachment of wires, cables, and associated equipment. It shall be presumed, subject to factual rebuttal, that a single attachment occupies one foot of usable space and that an average utility pole contains 13.5 feet of usable space.
An annual fee charged by a local publicly owned electric utility for use of a support structure by a communications service provider shall not exceed the local publicly owned electric utility’s annual costs of ownership of the percentage of the volume of the capacity of the structure rendered unusable by the equipment of the communications service provider.
As used in this subdivision, the “annual costs of ownership” is the sum of the annual capital costs and annual operation costs of the pole or support structure, which shall be the average costs of all similar utility poles or structures owned or controlled by the local publicly owned electric utility. The basis for the computation of annual capital costs shall be historical capital costs less depreciation. The accounting upon which the historical capital costs are determined shall include a credit for all reimbursed capital costs. Depreciation shall be based upon the average service life of the utility pole or support structure. “Annual cost of ownership” does not include costs for any property not necessary for use by the communications service provider.
A local publicly owned electric utility shall not levy a fee that exceeds the estimated amount required to provide use of the utility pole or support structure for which the annual recurring fee is levied. If the fee creates revenues in excess of actual costs, those revenues shall be used to reduce the fee.
A jointly owned pole is not included within the requirements of this section, if a joint owner other than the local publicly owned electric utility has control of access to the space that would be used by the communications service provider.
A local publicly owned electric utility may require an additional one-time charge equal to three years of the annual fee described in Section 9512, for attachments reasonably shown to have been made without authorization that are discovered on or after January 1, 2012.
A local publicly owned electric utility may remove an attachment made without authorization, if all of the following conditions are met:
The owner of the attachment fails to pay the charge described in subdivision (a), if that charge is applicable.
The owner of the attachment does not seek approval to attach pursuant to this part within a reasonable period of time.
The owner of the attachment does not contest that the attachment was made without authorization.
An attachment of a service drop wire is not made without authorization for the purposes of this section, if the owner of the attachment seeks approval to attach pursuant to this part within 45 days of the attachment.
Nothing in this part shall be construed to prohibit a local publicly owned electric utility from requiring a one-time fee to process a request for attachment, if the one-time fee does not exceed the actual cost of processing the request.
In the event that it becomes necessary for the local publicly owned electric utility to use space or capacity on or in a support structure occupied by the communications service provider’s equipment, the communications service provider shall either pay all costs for rearrangements necessary to maintain the pole attachment or remove its equipment at its own expense.
If the communications service provider requests a rearrangement of the utility pole or support structure, and the local publicly owned electric utility has the authority to levy fees as described in Section 9511.5, the local publicly owned electric utility may charge a one-time reimbursement fee for the actual costs incurred for the rearrangement.
Before adopting, or increasing, a fee described in this part, or adopting or changing the terms and conditions of access subject to this part, the local publicly owned electric utility shall hold at least one open and public meeting as part of a regularly scheduled meeting, at which time oral or written presentations relating to the fee or term or condition of access may be made.
At least 14 days before the meeting described in paragraph (1), the local publicly owned electric utility shall mail notice of the time and place of the meeting, including a general explanation of the matter to be considered, and a statement that the data required by paragraph (3) is available, to a person or entity who files a written request with the local publicly owned electric utility for mailed notice of the meeting.
At least 10 days before the meeting described in paragraph (1), the local publicly owned electric utility shall make available to the public data indicating the cost, or estimated cost, to make utility poles and support structures available for use by a communications service provider, if adopting or increasing a fee, and shall make available data and rationale for adopting or changing the terms and conditions of access, if adopting or changing the terms and conditions of access.
An action by a local publicly owned electric utility to adopt, or increase, a fee described in this part, or adopt or change the terms and conditions of access subject to this part, shall be taken solely by an ordinance or resolution adopted, or by a contract approved, by the governing body of the local publicly owned electric utility. The governing body of the local publicly owned electric utility shall not delegate the authority to adopt or increase the fee or term or condition of access to another entity or board or an official or employee of the board. This subdivision does not restrict a city council’s existing authority over a governing body appointed by the city council. The governing body of the local publicly owned electric utility shall ensure that the customers of the local publicly owned electric utility and the customers of the communications service provider are not subsidized by the rates, terms, and conditions proposed for access pursuant to this part.
The governing body of the local publicly owned electric utility shall approve the ordinance or resolution or contract to adopt or increase the fee, or adopt or change the terms and conditions of access subject to this part, at a subsequent open and public meeting as part of a regularly scheduled meeting, no earlier than 30 days after the initial public meeting described in subdivision (a).
An action adopting a fee or increasing a fee, or adopting or changing the terms and conditions of access subject to this part, pursuant to this section shall be effective no sooner than 60 days following the final action on the adoption of the fee or fee increase or adoption or change in the terms and conditions of access.
This section does not apply to a contract extension agreed to by all of the parties to the contract, if the terms, conditions, or rates described in the contract are not changed.
Any person or entity may protest the adoption or imposition of, or increase of, a fee described in this part, or adoption or change in the terms and conditions of access subject to this part, by serving written notice to the governing body of the local publicly owned electric utility within 30 days of the action taken. The written notice shall contain a statement informing the governing body of the factual elements of the dispute and the legal theory forming the basis for the protest.
The filing of protest pursuant to subdivision (a) shall not be a basis for the local publicly owned electric utility to withhold approval of the use of a utility pole or support structure.
A judicial action or proceeding to attack, review, set aside, void, or annul an ordinance, resolution, motion, or contract adopting, or increasing, a fee described in this part, or adopting or changing the terms and conditions of access subject to this part, or an automatic adjustment that results in an increase in the amount of a fee described in this part, shall be commenced within 120 days of the effective date of the ordinance, resolution, motion, contract, or automatic adjustment.
An action by a local publicly owned electric utility or interested person shall be brought pursuant to Chapter 9 (commencing with Section 860) of Title 10 of Part 2 of the Code of Civil Procedure.
A person or entity shall not initiate an action or proceeding pursuant to subdivision (a) unless both of the following requirements are met:
The fee or requirement will be directly imposed on the person or entity as a condition for the use of a utility pole or support structure, or the entity is a trade association that represents that person or entity.
At least 30 days before initiating the action or proceeding, the person or entity, or trade association representing that person or entity, requests the local publicly owned electric utility to provide a copy of documents that purport to establish that the fee does not exceed the amount reasonably necessary to cover the cost of the use of the utility pole or support structure, consistent with this part, or that the term and conditions of access or change to the terms and conditions of access are reasonable. The local publicly owned electric utility may charge a fee for the direct costs of copying the documents requested pursuant to this paragraph.
An action to enforce this part shall be brought in a court of competent jurisdiction.
A person or entity, or trade association representing that person or entity, may request an audit in order to determine whether a fee described in this part exceeds the amount reasonably necessary to cover the costs to the utility of the use of a utility pole or support structure, consistent with this part. A person or entity making that request shall retain an independent auditor to conduct an audit to determine whether the fee is reasonable, unless an audit has been performed for the same fee within the previous 12 months. The individual or entity requesting the audit shall pay for the direct costs associated with an audit made pursuant to this subdivision.
A person or entity, or trade association representing a person or entity, shall not request an audit unless the fee is directly imposed on the person or entity, or on a member of the trade association, as a condition for the use of the utility pole or support structure.
To the extent that the audit determines that the amount of the fee does not meet the requirements of this part, the local publicly owned electric utility shall adjust the fee accordingly.
Nothing in this part alters the ability of a local publicly owned electric utility to determine who performs work for the local publicly owned electric utility on its facilities.
The use of a utility pole or support structure by a communications service provider shall comply with Public Utilities Commission General Orders 95 and 128 and all other applicable provisions of law.
DIVISION 4.9. RESTRUCTURING OF PUBLICLY OWNED ELECTRIC UTILITIES IN CONNECTION WITH THE RESTRUCTURING OF THE ELECTRICAL SERVICES INDUSTRY [9600. - 9625.]
It is the intent of the Legislature that California’s local publicly owned electric utilities and electric corporations should commit control of their transmission facilities to the Independent System Operator as described in Chapter 2.3 (commencing with Section 330) of Part 1 of Division 1. These utilities should jointly advocate to the Federal Energy Regulatory Commission a pricing methodology for the Independent System Operator that results in an equitable return on capital investment in transmission facilities for all Independent System Operator participants and is based on the following principles:
Utility specific access charge rates as proposed in Docket No. EC96-19-000 as finally approved by the Federal Energy Regulatory Commission reflecting the costs of that utility’s transmission facilities shall go into effect on the first day of the Independent System Operator operation. The utility specific rates shall honor all of the terms and conditions of existing transmission service contracts and shall recognize any wheeling revenues of existing transmission service arrangements to the transmission owner.
No later than two years after the initial operation of the Independent System Operator, the Independent System Operator shall recommend for adoption by the Federal Energy Regulatory Commission a rate methodology determined by a decision of the Independent System Operator governing board, provided that the decision shall be based on principles approved by the governing board including, but not limited to, an equitable balance of costs and benefits, and shall define the transmission facility costs, if any, which shall be rolled in to the transmission service rate and spread equally among all Independent System Operator transmission users, and those transmission facility costs, if any, which should be specifically assigned to a specific utility’s service area.
If there is no governing board decision, the rate methodology shall be determined following a decision by the alternative dispute resolution method set forth in the Independent System Operator bylaws.
If no alternative dispute resolution decision is rendered, then a default rate methodology shall be a uniform regional transmission access charge and a utility specific local transmission access charge, provided that the default rate methodology shall be recommended for implementation upon termination of the cost recovery plan set forth in Section 368 or no later than two years after the initial operation of the Independent System Operator, whichever is later. For purposes of this paragraph, regional transmission facilities are defined to be transmission facilities operating at or above 230 kilovolts plus an appropriate percentage of transmission facilities operating below 230 kilovolts; all other transmission facilities shall be considered local. The appropriate percentage of transmission facilities described above shall be consistent with the guidelines in Federal Energy Regulatory Commission Order No. 888 and any exception approved by that commission.
If the rate methodology implemented as a result of a decision by the Independent System Operator governing board or resulting from the independent system operator alternative dispute resolution process results in rates different than those in effect prior to the decision for any transmission facility owner, the amount of any differences between the new rates and the prior rates shall be recorded in a tracking account to be recovered from customers and paid to the appropriate transmission owners by the transmission facility owner after termination of the cost recovery plan set forth in Section 368. The recovery and payments shall be based on an amortization period not to exceed three years in the case of the electrical corporations or five years in the case of the local publicly owned electric utilities.
The costs of transmission facilities placed in service after the date of initial implementation of the Independent System Operator shall be recovered using the rate methodology in effect at the time the facilities go into operation.
The electrical corporations and the local publicly owned electric utilities shall jointly develop language for implementation proposals to the Federal Energy Regulatory Commission based on these principles.
Nothing in this section shall compel any party to violate restrictions applicable to facilities financed with tax-exempt bonds or contractual restrictions and covenants regarding use of transmission facilities existing as of December 20, 1995.
Following a final Federal Energy Regulatory Commission decision approving the Independent System Operator, no California electrical corporation or local publicly owned electric utility shall be authorized to collect any competition transition charge authorized pursuant to this division and Chapter 2.3 (commencing with Section 330) of Part 1 of Division 1 unless it commits control of its transmission facilities to the Independent System Operator.
Except with respect to supply options of the nature specified in Section 218, with the exception of paragraph (3) of subdivision (b) of that section, as it existed on December 20, 1995, no person, corporation, electrical corporation, or local publicly owned electric utility or other governmental entity other than a retail customer’s existing electric service provider as of December 20, 1995, shall provide partial or full electric service to a retail customer of a local publicly owned electric utility unless the customer first confirms in writing an obligation to pay, through tariff or otherwise, to the utility currently providing electric service, a nonbypassable generation-related severance fee or transition charge established by the regulatory body for that utility. The severance fee or transition charge shall be paid directly to the local publicly owned utility providing electricity service in the service area in which the consumer is located.
Except as provided in subdivision (a) of Section 374, no local publicly owned electric utility or other governmental entity shall provide partial or full electric service to a retail customer of an electrical corporation unless the customer of that electrical corporation first confirms in writing an obligation to pay, through tariff or otherwise, to the electrical corporation currently providing electric service, a nonbypassable generation-related transition charge established by the regulatory body for that electrical corporation. The charge shall be paid directly to the electrical corporation providing electricity in the service area in which the consumer is located.
No local publicly owned electric utility or electrical corporation shall sell electric power to the retail customers of another local publicly owned electric utility or electrical corporation unless the first utility has agreed to allow the second utility to make sales of electric power to the retail customers of the first utility.
This section does not apply to an exchange of customers affected by a local publicly owned electric utility completing a mutually agreeable condemnation process to resolve a fringe area agreement in which there exists a balance of benefits between the customers of the local publicly owned electric utility and the electrical corporation.
After a public hearing, the local regulatory body of each local publicly owned electric utility shall determine whether it will authorize direct transactions between electricity suppliers and end use customers, subject to implementation of the nonbypassable severance fee or transition charge referred to in Section 9603.
If the regulatory body authorizes direct transactions, a phase-in of these transactions shall commence no later than the latter of January 1, 2000, or two years after the start of the phase-in of direct transactions by the electrical corporations pursuant to subdivision (b) of Section 365, and shall be completed by the later of December 31, 2010, or two years after the completion of the phase-in by electrical corporations.
The regulatory body shall develop a phase-in schedule at the conclusion of which all customers shall have the right to engage in direct transactions.
Any phase-in of customer eligibility for direct transactions ordered by the regulatory body shall be equitable to all customer classes.
If the regulatory body does not authorize direct access as contemplated in this section, then the publicly owned electric utility shall not be eligible to recover the nonbypassable charge as provided in Section 9603.
Not less than six months prior to the date of implementation of direct transactions, the regulatory body shall establish the nonbypassable generation-related severance fee or transition charge which shall include, but shall not be limited to, employee related transition costs incurred and projected for severance, out placement, retraining, early retirement, and related expenses for employees directly affected by restructuring.
The regulatory body of a local publicly owned electric utility, prior to adopting any generation related severance fee or transition charge, shall make available for public review the basis for the severance fee or transition charge and shall hold at least one public hearing.
For purposes of this division, the following definitions apply:
“Direct transaction” means a contract between one or more electric generators, marketers, or brokers, public or private, of electric power and one or more retail customers providing for the purchase and sale of electric power and ancillary services.
“Service area” means an area in which, as of December 20, 1995, an investor-owned electric utility or a local publicly owned electric utility was obligated to provide service.
“Severance fee” or “transition charge” for a local publicly owned electric utility shall mean that charge or periodic charge assessed to customers to recover the reasonable uneconomic portion of costs associated with generation-related assets and obligations, nuclear decommissioning, and capitalized energy efficiency investment programs approved prior to August 15, 1996.
This division and Chapter 2.3 (commencing with Section 330) of Part 1 of Division 1 do not affect preexisting ratemaking authority of a regulatory body of any local publicly owned electric utility.
This division does not modify or abrogate any agreement, or any rights or obligations in any such agreement, between retail electric service providers relating to service areas.
This division does not limit or affect the statutory rights of a local publicly owned electric utility to negotiate and design rates for existing customers and new customers not choosing to be served by an alternate supplier.
This division does not limit electric supply options within the service territory of a local publicly owned electric utility to the extent the options are of the nature specified in Section 218 as it existed on December 20, 1995, with the exception of paragraph (3) of subdivision (b) of that section, and the imposition of a severance fee or transition charge on customers electing those options shall be prohibited whether the elections are made before or after the availability of direct transactions within the service area of the local publicly owned electric utility.
All city-owned electric utilities shall report on the periodic bill the amount expected to be transferred from the utility to the general fund, and to any special funds, of the city on a no less than annual basis.
The intent of this section is to avoid cost-shifting to customers of an electrical corporation resulting from the transfer of distribution services from an electrical corporation to an irrigation district.
Except as otherwise provided in this section and Section 9608, and notwithstanding any other provision of law, an irrigation district that offered electrical service to retail customers as of January 1, 1999, may not construct, lease, acquire, install, or operate facilities for the distribution or transmission of electricity to retail customers located in the service territory of an electrical corporation providing electrical distribution services, unless the district has first applied for and received the approval of the commission and implements its service consistent with the commission’s order. The commission shall find that service to be in the public interest and shall approve the request of a district to provide distribution or transmission of electricity to retail customers located in the service territory of an electrical corporation providing electrical distribution service if, after notice and hearing, the commission determines all of the following:
The district will provide universal service to all retail customers who request service within the area to be served, at published tariff rates and on a just, reasonable, and nondiscriminatory basis, comparable to that provided by the current retail service provider.
If the area the district is proposing to serve is either of the following:
Is within the district’s boundaries but less than the entire district, the area to be served includes a percentage of residential customers and small customers, based on load, comparable to the percentage of residential and small customers in the district, based on load.
Includes territory outside the district’s boundaries, in which case the territory outside the district’s boundaries must include a percentage of residential customers and small customers, based on load, comparable to the percentage of residential and small customers in the county or counties where service is to be provided, based on load.
Service by the district will be consistent with the intent of the state to avoid economic waste caused by duplication of facilities as set forth in Section 8101.
Service by the district will include reasonable mitigation of any adverse effects on the reliability of an existing service by the electrical corporation.
The district has established, funded, and is carrying out public purpose and low-income programs comparable to those provided by the current electric retail service provider.
That district’s tariffed electrical service rates, exclusive of commodity costs, will be at least 15 percent below the tariffed electrical service rates, exclusive of commodity costs and nonbypassable charges under Sections 367, 368, 375, 376, and 379, of the electrical corporation for comparable services.
Service by the district is in the public interest.
An irrigation district that obtains the approval of the commission under this section to serve an area shall prepare an annual report available to the public on the total load and number of accounts of residential, low-income, agricultural, commercial, and industrial customers served by the irrigation district in the approved service area.
The commission shall have jurisdiction to resolve and adjudicate complaint cases brought against an irrigation district that offered electrical service to retail customers as of January 1, 1999, by an interested party where the complaint concerns retail electric service outside the boundaries of the district and within the service territory of an electrical corporation. Nothing in this section grants the commission jurisdiction to adjudicate complaint cases involving retail electrical service by an irrigation district inside its boundaries or inside an irrigation district’s exclusive service territory.
Any project involving electrical transmission or distribution facilities to be constructed or installed by an irrigation district to serve retail customers located in the service territory of an electrical corporation providing electrical distribution services shall comply with the California Environmental Quality Act (Division 13 (commencing with Section 21000) of the Public Resources Code). The county in which the construction or installation is to occur shall act as the lead agency. If a project involves the construction or installation of electrical transmission or distribution facilities in more than one county, the county where the majority of the construction is anticipated to occur shall act as the lead agency.
An irrigation district may not offer service to customers outside of its district boundaries before offering service to all customers within its district boundaries.
This section does not apply to electrical distribution service provided by the Modesto Irrigation District to those customers or within those areas described in subdivisions (a), (b), and (c) of Section 9610.
The provisions of this section shall not apply to (1) a cumulative 90 megawatts of load served by the Merced Irrigation District that is located within the boundaries of the district, as those boundaries existed on December 20, 1995, together with the territory of Castle Air Force Base that was located outside the district on that date, or (2) electric load served by the district that was not previously served by an electrical corporation that is located within the boundaries of the district, as those boundaries existed on December 20, 1995, together with the territory of Castle Air Force Base that was located outside the district on that date.
For purposes of this section, a megawatt of load shall be calculated in accordance with the methodology established by the Energy Commission in its Docket No. 96-IRR-1890, but the 90 megawatts shall not include electrical usage by customers that move to the areas described in paragraph (1) after December 31, 2000.
Subdivision (a) of this section shall not apply to the construction, modification, lease, acquisition, installation, or operation of facilities for the distribution or transmission of electricity to customers electrically connected to a district as of December 31, 2000, or to other customers who subsequently locate at the same premises.
In recognition of contractual arrangements and settlements existing as of June 1, 2000, this section does not apply to the acquisition or operation of the electrical distribution facilities that are the subject of the Settlement Agreement dated May 1, 2000, between Pacific Gas and Electric Company and the San Joaquin Irrigation District.
For purposes of this section, retail customers do not include an irrigation district’s own electric load being served at retail by an electrical corporation.
The irrigation district acquires substantially all the electric distribution facilities and related subtransmission facilities of any electrical corporation that has an obligation to provide electric distribution service within the area to be served by the irrigation district.
The commission approves a service area agreement between the irrigation district and the electrical corporation pursuant to Sections 8101 to 8108, inclusive, which service area agreement provides that the electrical corporation may not provide electric distribution service in the area to be served by the irrigation district and that the irrigation district may not provide electric distribution service in the remainder of the electrical corporation’s service territory.
The commission relieves the electrical corporation of its obligation to serve within the area to be served by the irrigation district.
Commencing on January 1, 2001, and continuing through December 31, 2025, inclusive, all of the following shall apply:
An electrical corporation may not provide electric transmission or distribution service to retail customers in either of the following areas:
The Modesto Irrigation District electric service area as defined in the August 15, 1940, Purchase of Properties agreement between Modesto Irrigation District and Pacific Gas and Electric Company.
The Mountain House Community Services District as defined in the master specific plan adopted by the Board of Supervisors of the County of San Joaquin on November 10, 1994.
Within the purchase zone as described in Exhibit “B” of The Asset Sale Agreement By and Between Pacific Gas and Electric Company and Modesto Irrigation District Dated July 23, 1997, contained in Public Utilities Commission Application Number 97-07-030, Pacific Gas and Electric Company and Modesto Irrigation District may each provide electric transmission and distribution service to retail customers. The area described in this subdivision shall be considered to be within both Pacific Gas and Electric Company’s and Modesto Irrigation District’s electric service area.
The Legislature recognizes that electrical corporations and irrigation districts may each construct infrastructure, and that the infrastructure may, in some cases, be duplicative. In those cases, the Legislature encourages irrigation districts and electrical corporations to enter into agreements pursuant to Sections 8101 to 8108, inclusive, where those agreements further the interests of the state as set forth in Section 8101.
Modesto Irrigation District may provide up to 8 megawatts of peak sales to Contra Costa Water District for delivery to its Old River Intake Facility and Rock Slough Pumping Plant.
Except as provided in subdivisions (a), (b), and (c), Modesto Irrigation District may not provide electric transmission or distribution service to retail customers in the territory of Pacific Gas and Electric Company.
Chapter 3 (commencing with Section 56100) of Part 1 of Division 3 of the Government Code does not apply to electric service provided by the Modesto Irrigation District within the geographic areas described in subdivisions (a) and (b) of Section 9610.
The Legislature finds and declares that the policies stated in Section 8101 to 8108, inclusive, would be furthered and that it would be in the best interests of the state, and not incompatible with the public interest, if an agreement embodying the provisions of Section 9610 were to be approved by the commission. The Legislature hereby encourages the Pacific Gas and Electric Company and Modesto Irrigation District to agree on the terms of an agreement embodying the provisions of Section 9610, and encourages the commission to approve that agreement to the extent that the agreement is consistent with the policies of this state.
Beginning January 15, 2002, and at least once monthly thereafter, a local publicly owned electric utility shall notify each air pollution control district and air quality management district of the name and address of each entity within the district’s boundaries within the local publicly owned electric utility’s control or service area with whom the utility enters into an interruptible service contract or similar arrangement.
For the purposes of this section, “interruptible service contract or similar arrangement” means any arrangement in which a nonresidential electrical customer agrees to reduce or consider reducing its electrical consumption during periods of peak demand or at the request of the local publicly owned electric utility in exchange for compensation, or for assurances not to be blacked out or other similar nonmonetary assurances.
The local air pollution control district or air quality management district shall maintain in a confidential manner the information received pursuant to this section. However, nothing in this subdivision shall affect the applicability of Division 10 (commencing with Section 7920.000) of Title 1 of the Government Code, or of any other similar open records statute or ordinance, to information provided pursuant to this section.
Each local publicly owned electric utility, in procuring energy to serve the load of its retail end-use customers, shall first acquire all available energy efficiency and demand reduction resources that are cost effective, reliable, and feasible.
To the extent that doing so is cost effective, a local publicly owned electric utility providing electric service to 250,000 or more customers within the Los Angeles Basin shall maximize the use of demand response, renewable energy resources, and energy efficiency to reduce demand in the area where electrical reliability has been impacted as a result of reductions in gas storage capacity and gas deliverability resulting from the well failure at the Aliso Canyon natural gas storage facility first reported to the commission in October 2015.
For purposes of this section, “Los Angeles Basin” means the area identified as the “Aliso Canyon Delivery Area” on page 11 of the Aliso Canyon Risk Assessment Technical Report, dated April 5, 2016.
Except as provided in paragraph (2), a local publicly owned electric utility that provides electric service to 250,000 or more customers within the Los Angeles Basin shall make publicly available, upon request of any person, electrical grid data necessary or useful to enable distributed energy resource providers to target solutions that support reliability in the area where electrical reliability has been impacted as a result of reductions in gas storage capacity and gas deliverability resulting from the well failure at the Aliso Canyon natural gas storage facility first reported to the commission in October 2015.
A local publicly owned electric utility shall not make data available pursuant to paragraph (1) that is prohibited from being disclosed pursuant to state or federal law.
The data made available pursuant to this subdivision shall be available pursuant to the California Public Records Act (Division 10 (commencing with Section 7920.000) of Title 1 of the Government Code), commencing within 60 days of the effective date of this section.
For purposes of this section, “Los Angeles Basin” means the area identified as the “Aliso Canyon Delivery Area” on page 11 of the Aliso Canyon Risk Assessment Technical Report, dated April 5, 2016.
Each local publicly owned electric utility serving end-use customers shall prudently plan for and procure resources that are adequate to meet its planning reserve margin and peak demand and operating reserves, sufficient to provide reliable electric service to its customers. Customer generation located on the customer’s site or providing electric service through arrangements authorized by Section 218, shall not be subject to these requirements if the customer generation, or the load it serves, meets one of the following criteria:
It takes standby service from the local publicly owned electric utility on a rate schedule that provides for adequate backup planning and operating reserves for the standby customer class.
It is not physically interconnected to the electric transmission or distribution grid, so that, if the customer generation fails, backup power is not supplied from the electricity grid.
There is physical assurance that the load served by the customer generation will be curtailed concurrently and commensurately with an outage of the customer generation.
Each local publicly owned electric utility serving end-use customers shall, at a minimum, meet the most recent minimum planning reserve and reliability criteria approved by the Board of Trustees of the Western Systems Coordinating Council or the Western Electricity Coordinating Council.
Each local publicly owned electric utility shall prudently plan for and procure energy storage systems that are adequate to meet the requirements of Section 2836.
A local publicly owned electric utility serving end-use customers shall, upon request, provide the Energy Commission with any information the Energy Commission determines is necessary to evaluate the progress made by the local publicly owned electric utility in meeting the requirements of this section, consistent with the annual targets established pursuant to subdivision (c) of Section 25310 of the Public Resources Code.
The Energy Commission shall report to the Legislature, to be included in each integrated energy policy report prepared pursuant to Section 25302 of the Public Resources Code, regarding the progress made by each local publicly owned electric utility serving end-use customers in meeting the requirements of this section.
A local publicly owned electric utility may meet its minimum planning reserve margin through individual contractual procurement or through an aggregated or pooled portfolio of resources if that aggregation or pooling is defined in a contractual arrangement and each participating local publicly owned electric utility meets its individual minimum planning reserve margin based on its share of the resource portfolio pool.
This section shall apply to a local publicly owned electric utility with an annual electrical demand exceeding 700 gigawatthours, as determined on a three-year average commencing January 1, 2013.
On or before January 1, 2019, the governing board of a local publicly owned electric utility shall adopt an integrated resource plan and a process for updating the plan at least once every five years to ensure the utility achieves all of the following:
Meets the greenhouse gas emissions reduction targets established by the State Air Resources Board, in coordination with the commission and the Energy Commission, for the electricity sector and each local publicly owned electric utility that reflect the electricity sector’s percentage in achieving the economywide greenhouse gas emissions reductions of 40 percent from 1990 levels by 2030.
Ensures procurement of at least 50 percent eligible renewable energy resources by 2030 consistent with Article 16 (commencing with Section 399.11) of Chapter 2.3 of Part 1 of Division 1.
Meets the goals specified in subparagraphs (D) to (H), inclusive, of paragraph (1) of subdivision (a) of Section 454.52, and the goal specified in subparagraph (C) of paragraph (1) of subdivision (a) of Section 454.52, as that goal is applicable to each local publicly owned electric utility. A local publicly owned electric utility shall not, solely by reason of this paragraph, be subject to requirements otherwise imposed on electrical corporations.
In furtherance of the carbon neutrality goals set forth in Executive Order B-55-18 To Achieve Carbon Neutrality (September 10, 2018), each updated integrated resource plan shall include, as applicable, details of the utility’s electrical service rate design that support transportation electrification, and existing or planned incentives to support transportation electrification, including rebates. The rate design shall include details for all applicable transportation sectors, including, but not limited to, on-road and off-road vehicles in the light-, medium-, and heavy-duty sectors. Each integrated resource plan shall also include information about the utility’s customer education and outreach efforts being implemented to inform utility customers of available incentives and decisionmaking tools, such as cost calculators or cost estimates that can assist customers in predicting the cost of paying for electricity for these vehicles.
In furtherance of the requirements of subdivision (b), the governing board of a local publicly owned electric utility shall consider the role of existing renewable generation, grid operational efficiencies, energy storage, and distributed energy resources, including energy efficiency, in helping to ensure each utility meets energy needs and reliability needs in hours to encompass the hour of peak demand of electricity, excluding demand met by variable renewable generation directly connected to a California balancing authority, as defined in Section 399.12, while reducing the need for new electricity generation resources and new transmission resources in achieving the state’s energy goals at the least cost to ratepayers.
Energy efficiency and demand response resources pursuant to Section 9615.
Energy storage requirements pursuant to Chapter 7.7 (commencing with Section 2835) of Part 2 of Division 1.
Transportation electrification.
A diversified procurement portfolio consisting of both short-term and long-term electricity, electricity-related, and demand response products.
The resource adequacy requirements established pursuant to Section 9620.
The governing board of the local publicly owned electric utility may authorize all source procurement that includes various resource types, including demand-side resources, supply side resources, and resources that may be either demand-side resources or supply side resources, to ensure that the local publicly owned electric utility procures the optimum resource mix that meets the objectives of subdivision (b).
The governing board may authorize procurement of resource types that will reduce overall greenhouse gas emissions from the electricity sector and meet the other goals specified in subdivision (b), but due to the nature of the technology or fuel source may not compete favorably in price against other resources over the time period of the integrated resource plan.
A local publicly owned electric utility shall satisfy the notice and public disclosure requirements of subdivision (f) of Section 399.30 with respect to any integrated resource plan or plan update it considers.
Integrated resource plans and plan updates adopted pursuant to Section 9621 shall be submitted to the Energy Commission.
The Energy Commission shall review the integrated resource plans and plan updates. If the Energy Commission determines an integrated resource plan or plan update is inconsistent with the requirements of Section 9621, the Energy Commission shall provide recommendations to correct the deficiencies.
The Energy Commission may adopt guidelines to govern the submission of information and data and reports needed to support the Energy Commission’s review of the utility’s integrated resource plan pursuant to this section at a publicly noticed meeting offering all interested parties an opportunity to comment. The Energy Commission shall provide written public notice of not less than 30 days for the initial adoption of guidelines and not less than 10 days for the subsequent adoption of substantive changes. Notwithstanding any other law, any guidelines adopted pursuant to this section shall be exempt from the requirements of Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code.
In its relevant distribution planning process, a local publicly owned electric utility shall consider the fleet data produced by the Energy Commission pursuant to Section 25328 of the Public Resources Code, and other available data, to facilitate the readiness of their distribution systems to support the level of electric vehicle charging anticipated by Executive Orders No. B-48-18 and N-79-20, the Energy Commission’s integrated energy policy report adopted pursuant to Section 25302 of the Public Resources Code, the Energy Commission’s assessment prepared pursuant to Section 25229 of the Public Resources Code, and relevant State Air Resources Board regulations. The local publicly owned electric utility’s consideration shall also include, as applicable and available, other local plans related to electric vehicle charging, including air quality management plans, regional seaport plans, regional transportation plans, and sustainable communities strategies.
A local publicly owned electric utility shall identify any distribution investments made pursuant to this section in its integrated resource plan adopted pursuant to Section 9621.
DIVISION 5. UTILITIES OWNED BY MUNICIPAL CORPORATIONS [10001. - 10303.]
CHAPTER 1. Acquisition, Operation, and Sale of Utilities [10001. - 10303.]
ARTICLE 1. Acquisition and Operation [10001. - 10014.]
“Public utility” as used in this article, means the supply of a municipal corporation alone or together with its inhabitants, or any portion thereof, with water, light, heat, power, sewage collection, treatment, or disposal for sanitary or drainage purposes, transportation of persons or property, means of communication, or means of promoting the public convenience.
A municipal corporation that provides broadband Internet access services shall comply with the requirements of Article 12 (commencing with Section 53167) of Chapter 1 of Part 1 of Division 2 of Title 5 of the Government Code.
Any municipal corporation may acquire, construct, own, operate, or lease any public utility.
The power to acquire and operate a public utility includes the power to complete, reconstruct, extend, change, enlarge, and repair a public utility acquired, constructed, owned, or operated by a municipality.
For the purpose set forth in Sections 10002 and 10003 a municipal corporation may acquire, own, control, sell, or exchange lands, easements, licenses, and rights of every nature within or without its corporate limits, and may operate a public utility within or without the corporate limits when necessary to supply the municipality, or its inhabitants or any portion thereof, with the service desired.
Except as provided for in subdivision (b), any judicial action or proceeding against a municipal corporation that provides electric utility service, to attack, review, set aside, void, or annul an ordinance, resolution, or motion fixing or changing a rate or charge for an electric commodity or an electric service furnished by a municipal corporation and adopted on or after July 1, 2000, shall be commenced within 120 days of the effective date of that ordinance, resolution, or motion.
This section does not apply to any judicial action or proceeding filed pursuant to Chapter 13.7 (commencing with Section 54999) of Part 1 of Division 2 of Title 5 of the Government Code to protest or challenge a rate or charge or to seek the refund of a capital facilities fee if the notice and disclosure requirements of Section 54999.35 of the Government Code have not been followed.
Whenever, in the operation of a utility, a municipality develops an excess of water, light, heat, or power, over and above the amount which is necessary for the use of the municipality and its inhabitants, or such portion thereof as the legislative body of the municipality determines is to be supplied therewith, the municipality may sell, lease, or distribute the excess outside of its corporate limits.
No lease of a public utility is valid for a period of more than 15 years, and all such leases shall be let to the highest bidder at public auction.
Every public utility furnishing light, heat, or power shall expend no funds for advertising when such advertising encourages increased consumption of such services or commodities.
Nothing in this section shall prohibit a public utility furnishing light, heat, or power from expending funds for advertising which encourages the more efficient operation of the public utility or for advertising which encourages the more efficient use of light, heat, or power, the conservation of energy or natural resources, or presents accurate information on the economical purchase, maintenance, or use of any appliance or device using light, heat, or power.
This section applies if there is a landlord-tenant relationship between the residential occupants and the owner, manager, or operator of the dwelling.
If a public utility furnishes individually metered residential light, heat, water, or power to residential occupants in a detached single-family dwelling, a multiunit residential structure, mobilehome park, or a permanent residential structure in a labor camp, as defined in Section 17008 of the Health and Safety Code, and the owner, manager, or operator of the dwelling, structure, or park is the customer of record, the public utility shall make every good faith effort to inform the residential occupants, by means of written notice, when the account is in arrears, that service will be terminated in 10 days. The written notice shall further inform the residential occupants that they have the right to become customers of the public utility without being required to pay the amount due on the delinquent account. The notice shall be in English and in the languages listed in Section 1632 of the Civil Code.
The public utility is not required to make service available to the residential occupants unless each residential occupant agrees to the terms and conditions of service, and meets the requirements of law and the public utility’s rules. However, if one or more of the residential occupants are willing and able to assume responsibility for the subsequent charges to the account to the satisfaction of the public utility, or if there is a physical means, legally available to the public utility, of selectively terminating service to those residential occupants who have not met the requirements of the public utility’s rules, the public utility shall make service available to the residential occupants who have met those requirements.
If prior service for a period of time is a condition for establishing credit with the public utility, residence and proof of prompt payment of rent or other obligation acceptable to the public utility for that period of time is a satisfactory equivalent.
Any residential occupant who becomes a customer of the public utility pursuant to this section whose periodic payments, such as rental payments, include charges for residential light, heat, water, or power, where these charges are not separately stated, may deduct from the periodic payment each payment period all reasonable charges paid to the public utility for those services during the preceding payment period.
If a public utility furnishes light, heat, water, or power to residential occupants through a master meter in a multiunit residential structure, mobilehome park, or permanent residential structures in a labor camp, as defined in Section 17008 of the Health and Safety Code, and the owner, manager, or operator of the structure or park is listed by the public utility as the customer of record, the public utility shall make every good faith effort to inform the residential occupants, by means of a written notice posted on the door of each residential unit at least 15 days prior to termination, when the account is in arrears, that service will be terminated on a date specified in the notice. If it is not reasonable or practicable to post the notice on the door of each residential unit, the public utility shall post two copies of the notice in each accessible common area and at each point of access to the structure or structures. The notice shall further inform the residential occupants that they have the right to become utility customers, to whom the service will then be billed, without being required to pay the amount due on the delinquent account. The notice also shall specify, in plain language, what the residential occupants are required to do in order to prevent the termination of, or to reestablish service; the estimated monthly cost of service; the title, address, and telephone number of a representative of the public utility who can assist the residential occupants in continuing service; and the address and telephone number of a qualified legal services project, as defined in Section 6213 of the Business and Professions Code, which has been recommended by the local county bar association. The notice shall be in English and the languages listed in Section 1632 of the Civil Code.
The public utility is not required to make service available to the residential occupants unless each residential occupant or a representative of the residential occupants agrees to the terms and conditions of service, and meets the requirements of law and the public utility’s rules. However, if one or more of the residential occupants or the representative of the residential occupants are willing and able to assume responsibility for subsequent charges to the account to the satisfaction of the public utility, or if there is a physical means, legally available to the public utility, of selectively terminating service to those residential occupants who have not met the requirements of the public utility’s rules or for whom the representative of the residential occupants is not responsible, the public utility shall make service available to the residential occupants who have met those requirements or on whose behalf those requirements have been met.
If prior service for a period of time or other demonstration of credit worthiness is a condition for establishing credit with the public utility, residence and proof of prompt payment of rent or other credit obligation during that period of time acceptable to the public utility is a satisfactory equivalent.
Any residential occupant who becomes a customer of the public utility pursuant to this section whose periodic payments, such as rental payments, include charges for residential light, heat, water, or power, where these charges are not separately stated, may deduct from the periodic payment each payment period all reasonable charges paid to the public utility for those services during the preceding payment period.
If a public utility furnishes residential service subject to subdivision (a), the public utility may not terminate that service in any of the following situations:
During the pendency of an investigation by the public utility of a customer dispute or complaint.
If the customer has been granted an extension of the period for payment of a bill.
For an indebtedness owed by the customer to any other public agency or when the obligation represented by the delinquent account or other indebtedness was incurred with any public agency other than the public utility.
If a delinquent account relates to another property owned, managed, or operated by the customer.
If a public health or building officer certifies that termination would result in a significant threat to the health or safety of the residential occupants or the public.
Notwithstanding any other provision of law, and in addition to any other remedy provided by law, if the owner, manager, or operator, by any act or omission, directs, permits, or fails to prevent a termination of service while any residential unit is occupied, the residential occupant or the representative of the residential occupants may commence an action for the recovery of all of the following:
Reasonable costs and expenses incurred by the residential occupant or the representative of the residential occupants related to restoration of service.
Actual damages related to the termination of service.
Reasonable attorney’s fees of the residential occupants, the representative of the residential occupants, or each of them, incurred in the enforcement of this section, including, but not limited to, enforcement of a lien.
Notwithstanding any other provision of law, and in addition to any other remedy provided by law, if the owner, manager, or operator, by any act or omission, directs, permits, or fails to prevent a termination of service while any residential unit receiving that service is occupied, the corporation may commence an action for the recovery of all of the following:
Delinquent charges accruing prior to the expiration of the notice prescribed by subdivision (a).
Reasonable costs incurred by the corporation related to the restoration of service.
Reasonable attorney’s fees of the corporation incurred in the enforcement of this section or in the collection of delinquent charges, including, but not limited to, enforcement of a lien.
If the court finds that the owner, manager, or operator has paid the amount in arrears prior to termination, the court shall allow no recovery of any charges, costs, damages, expenses, or fees under this subdivision from the owner, manager, or operator.
An abstract of any money judgment entered pursuant to subdivision (f) or (g) of this section shall be recorded pursuant to Section 697.310 of the Code of Civil Procedure.
No termination of service subject to this section may be effected without compliance with this section, and any service wrongfully terminated shall be restored without charge to the residential occupants or customer for the restoration of the service. In the event of a wrongful termination by the public utility, the public utility shall, in addition, be liable to the residential occupants or customer for actual damages resulting from the termination and for the costs of enforcement of this section, including, but not limited to, reasonable attorney’s fees, if the residential occupants or the representative of the residential occupants make a good faith effort to have the service continued without interruption.
The public utility shall adopt rules and regulations necessary to implement this section and shall liberally construe this section to accomplish its purpose of ensuring that service to residential occupants is not terminated due to nonpayment by the customer unless the public utility has made every reasonable effort to continue service to the residential occupants. The rules and regulations shall include, but are not limited to, guidelines for assistance to actual users in the enforcement of this section and requirements for the notice prescribed by subdivision (a), including, but not limited to, clear wording, large and boldface type, and comprehensive instructions to ensure full notice to the actual user.
Nothing in this section broadens or restricts any authority of a local agency that existed prior to January 1, 1989, to adopt an ordinance protecting a residential occupant from the involuntary termination of residential public utility service.
This section preempts any statute or ordinance permitting punitive damages against any owner, manager, or operator on account of an involuntary termination of residential public utility service or permitting the recovery of costs associated with the formation, maintenance, and termination of a tenants’ association.
For purposes of this section, “representative of the residential occupants” does not include a tenants’ association.
The decision of a public utility to require a new residential applicant to deposit a sum of money with the public utility prior to establishing an account and furnishing service shall be based solely upon the creditworthiness of the applicant as determined by the public utility.
No municipal corporation owning or operating a public utility furnishing services for residential use to a tenant under an account established by the tenant shall seek to recover any charges or penalties for the furnishing of services to, or for the tenant’s residential use from, any subsequent tenant or the property owner due to nonpayment of charges by a previous tenant. For this purpose, the term “subsequent tenant” shall not include any adult person who lived at the residence during the period that the charges or penalties accrued. The municipal corporation may collect a deposit from the tenant service applicant prior to establishing an account for the tenant. The municipal corporation may not require that service to subsequent tenants be furnished on the account of the landlord or property owner unless the property owner voluntarily agrees to that requirement, nor may the municipal corporation refuse to furnish services to a tenant in the tenant’s name based upon the nonpayment of charges by a previous tenant.
A public utility subject to this section may not demand or receive security in an amount that exceeds twice the estimated average periodic bill or three times the estimated average monthly bill.
In the event of tenant nonpayment of all or a portion of the bill, the deposit shall be applied to the final bill issued when service is terminated.
This section shall not apply to master-metered apartment buildings.
No public utility furnishing light, water, power, or heat may terminate residential service for nonpayment of a delinquent account unless the public utility first gives notice of the delinquency and impending termination, as provided in Section 10010.1.
No public utility shall terminate residential service for nonpayment in any of the following situations:
During the pendency of an investigation by the public utility of a customer dispute or complaint.
When a customer has been granted an extension of the period for payment of a bill.
On the certification of a licensed physician and surgeon that to do so will be life threatening to the customer and the customer is financially unable to pay for service within the normal payment period and is willing to enter into an amortization agreement with the public utility pursuant to subdivision (e) with respect to all charges that the customer is unable to pay prior to delinquency.
Any residential customer who has initiated a complaint or requested an investigation within five days of receiving the disputed bill, or who has, within 13 days of mailing of the notice required by subdivision (a), made a request for extension of the payment period of a bill asserted to be beyond the means of the customer to pay in full during the normal period for payment, shall be given an opportunity for review of the complaint, investigation, or request by a review manager of the public utility. The review shall include consideration of whether the customer shall be permitted to amortize the unpaid balance of the account over a reasonable period of time, not to exceed 12 months. No termination of service shall be effected for any customer complying with the amortization agreement, if the customer also keeps the account current as charges accrue in each subsequent billing period.
Any customer whose complaint or request for an investigation pursuant to subdivision (c) has resulted in an adverse determination by the public utility may appeal the determination to the governing body of the municipal corporation. Any subsequent appeal of the dispute or complaint to the governing body is not subject to this section.
Any customer meeting the requirements of paragraph (3) of subdivision (b) shall, upon request, be permitted to amortize, over a period not to exceed 12 months, the unpaid balance of any bill asserted to be beyond the means of the customer to pay within the normal period for payment.
A public utility furnishing light, heat, water, or power shall not terminate residential service on account of nonpayment of a delinquent account unless the public utility first gives notice of the delinquency and impending termination, at least 10 days prior to the proposed termination, by means of a notice mailed, postage prepaid, to the customer to whom the service is billed, not earlier than 19 days from the date of mailing the public utility’s bill for services, and the 10-day period shall not commence until five days after the mailing of the notice.
Every public utility shall make a reasonable attempt to contact an adult person residing at the premises of the customer by telephone or personal contact, at least 24 hours prior to any termination of service, except that, whenever telephone or personal contact cannot be accomplished, the public utility shall give, by mail, in person, or by posting in a conspicuous location at the premises, a notice of termination of service, at least 48 hours prior to termination.
Every public utility shall make available to its residential customers who are 65 years of age or older, or who are dependent adults as defined in Section 15610.23 of the Welfare and Institutions Code, a third-party notification service, whereby the public utility will attempt to notify a person designated by the customer to receive notification when the customer’s account is past due and subject to termination. The notification shall include information on what is required to prevent termination of service. The residential customer shall make a request for third-party notification on a form provided by the public utility, and shall include the written consent of the designated third party. The third-party notification does not obligate the third party to pay the overdue charges, nor shall it prevent or delay termination of service.
Every notice of termination of service pursuant to subdivision (a) shall include all of the following information:
The name and address of the customer whose account is delinquent.
The amount of the delinquency.
The date by which payment or arrangements for payment is required in order to avoid termination.
The procedure by which the customer may initiate a complaint or request an investigation concerning service or charges, except that, if the bill for service contains a description of that procedure, the notice pursuant to subdivision (a) is not required to contain that information.
The procedure by which the customer may request amortization of the unpaid charges.
The procedure for the customer to obtain information on the availability of financial assistance, including private, local, state, or federal sources, if applicable.
The telephone number of a representative of the public utility who can provide additional information or institute arrangements for payment.
Every notice of termination of service pursuant to subdivision (b) shall include the items of information in paragraphs (1), (2), (3), (6), and (7).
All written notices shall be in a clear and legible format.
If a residential customer fails to comply with an amortization agreement, the public utility shall not terminate service without giving notice to the customer at least 48 hours prior to termination of the conditions the customer is required to meet to avoid termination, but the notice does not entitle the customer to further investigation by the public utility.
A termination of service shall not be effected without compliance with this section. Any service wrongfully terminated shall be restored without charge for the restoration of service, and a notation thereof shall be mailed to the customer at the customer’s billing address.
No electrical, gas, heat, or water public utility shall, by reason of delinquency in payment for any electric, gas, heat, or water services, cause cessation of any such services on any Saturday, Sunday, legal holiday, or at any time during which the business offices of the public utility are not open to the public.
Whenever a business transaction of a public utility, as defined in Section 10001, furnishing electricity, gas, water service where the utility has 10,000 or more service connections, or telephone service is such that a personal appearance by a person is required by the utility and the person is unable to appear at the utility’s place of business during the utility’s usual business hours, then the utility shall provide a reasonable and convenient alternative to the person such as an appointment outside the utility’s usual business hours or allowing the person to conduct the transaction by telephone, mail, or both.
Every public utility shall comply with Section 8029.5.
Subsequent to signing a contingent franchise, license, or service agreement with a local agency, a privatizer shall apply to the commission for a determination that the proposed privatization project is not a public utility within the meaning of Section 216 and is therefore exempt from commission regulation. When a privatizer files an application with the commission, the privatizer shall include the information the commission requires to make a determination in accordance with subdivisions (b), (c), (d), and (e).
Not later than 60 calendar days after the privatizer submits its application to the commission, the commission shall determine in writing whether the application is complete and shall immediately transmit the determination to the privatizer.
If the application is determined not to be complete, the commission shall specify in writing those parts of the application which are incomplete and shall indicate the manner in which it can be made complete, including a list and thorough description of the specific information needed to complete the application. The applicant shall submit materials to the commission in response to the list and description. Upon resubmittal of the application, a new 60-calendar-day period shall begin, during which the commission shall determine the completeness of the application.
If the application is deemed complete, the commission may determine not later than 90 calendar days after the application is deemed complete that the privatization project is not a public utility within the meaning of Section 216 and is therefore exempt from commission regulation, if the commission finds that the application clearly complies with the criteria in subdivisions (d) and (e). If the commission does not make this finding, then it shall proceed under the schedule established in subdivision (c).
If the commission fails to make a written determination as to the completeness of the application within 60 calendar days after receipt of the original or resubmitted application, the application shall be deemed complete for purposes of this section.
Within 180 calendar days after the application is deemed complete, the commission shall determine whether the privatization project is a public utility within the meaning of Section 216 using the criteria in subdivisions (d) and (e). The commission may hold a hearing on the matter if the commission finds it to be necessary. No franchise, license, or service agreement between a privatizer and a local agency shall be entered into until the commission has either exempted the project or the 180-calendar-day period has expired, whichever comes first. Nothing in this section precludes a privatizer and the commission from mutually agreeing to a further extension of any time limit provided in this section.
The commission may determine that a privatization project is not a public utility within the meaning of Section 216, and is therefore exempt from commission regulation if it finds that the franchise, license, or service agreement both demonstrates that the local agency retains sufficient jurisdiction to protect the public interest and adequately addresses all aspects of the provision of service which would otherwise be subject to commission regulation. In making its determination, the commission shall determine whether the local agency has complied with Section 54253 of the Government Code. The decision of the commission shall be final and conclusive in the absence of any subsequent changes.
In making a determination pursuant to subdivision (c), the commission shall review the franchise, license, or service agreement to ensure that the agreement grants the local agency, at a minimum, all of the following:
Exclusive authority to establish all rates and rate changes charged to the public.
Approval over any proposal of the privatizer to provide new, additional, or alternative service to any other public or private entity or to change the service fee paid to the privatizer by the local agency.
Approval over the original design and construction of the project, including any changes in design, alterations, or additions to the project.
Approval over any changes in ownership of the party or parties subject to the franchise, license, or service agreement.
Authority to impose fines and penalties for noncompliance with any provision of the executed franchise, license, or service agreement, or for failure to provide the service within the time period agreed to in the franchise, license, or service agreement.
Authority to ensure that the facility is adequately maintained.
Adequate opportunity to monitor compliance with the agreement and to ensure the project will be operated to meet any applicable federal or state water quality standards or other applicable laws.
Adequate opportunity to amend the agreement in the event of unforeseen circumstances or contingencies, such as flood, earthquake, fire, or other natural disasters or federal tax law changes.
The commission may adopt whatever procedures it deems necessary to carry out the provisions of subdivisions (a), (b), (c), (d), and (e). The commission shall adopt regulations for reviewing any proposed changes to a contingent franchise, license, or service agreement to determine if the proposed changes could render the project a public utility within the meaning of Section 216. The commission shall charge each privatizer submitting an application pursuant to this section a fee which will be sufficient to defray the costs incurred in processing the application and rendering a decision upon it.
As used in this section, “privatization project” means any waste water or sewerage project that is owned and operated by a privatizer pursuant to a franchise, license, or service agreement with a local agency, or any agency of that local agency, pursuant to which services are supplied for the benefit of the local agency, its residents, or both, or any agency of the state. “Project” includes, but is not limited to, financing, designing, constructing, repairing, replacing, maintaining, and operating collector systems, pumping stations, treatment plants, and lateral interceptors, and outfall sewers. “Local agency” means any city, county, city and county, special district, or county service area. “Privatizer” means any corporation, partnership, or natural person, excluding municipal corporations, which owns and operates a wastewater or sewerage project pursuant to a franchise, license, or service agreement with a local agency. “Privatization project,” as used in this section, includes the Santa Ana Watershed Project Authority’s Arlington Basin Groundwater Desalter Project, which will treat groundwater contaminated by wastewater.
The commission may enter into a contract with a local agency to provide any technical assistance needed to comply with Section 10013, if the contract includes provisions for the commission to be reimbursed for its estimated reasonable costs.
ARTICLE 2. Sale and Disposal [10051. - 10061.]
Any municipal corporation incorporated under the laws of this State may as provided in this article sell and dispose of any public utility that it owns.
Whenever the legislative body of a municipal corporation by a resolution passed by two-thirds of all its members determines that the public interest and necessity demand that any public utility owned by the municipal corporation should be sold, it may at any subsequent meeting by a vote of two-thirds of all its members order the proposition of selling the public utility to be submitted to the qualified voters of the municipal corporation at an election held for that purpose.
The ordinance calling the special election shall recite the object for which the election is to be held, the purpose for which the proceeds of the sale are proposed to be expended, the manner of holding the election, and the manner of voting for or against the sale of the public utility. In all particulars not recited in the ordinance the election shall be held as provided for by law for holding municipal elections in such municipality.
The ordinance shall be published once a day for at least 12 days in a newspaper published at least six days a week in the municipality or at least once a week for two weeks in a newspaper published less than six days a week in the municipality. The insertion each week for two succeeding weeks is a sufficient publication in a newspaper published less than six days a week. The first publication of the ordinance shall be at least two weeks prior to the date mentioned in the ordinance for holding the election. In municipalities where no such newspaper is published the ordinance shall be posted in three public places therein for two succeeding weeks next before the day fixed for the election.
The votes of two-thirds of all voters voting at the election are necessary to authorize the sale of the public utility described in the ordinance calling the election.
The resolution and ordinance may provide for the sale of more than one public utility, but in such case the question of selling each public utility shall be separately stated in the ordinance and upon the election ballots.
If the vote cast at the election is in favor of the sale of the public utility mentioned in the ordinance calling for the election, the legislative body of the municipal corporation shall immediately proceed to sell the public utility, and shall fix a date on which bids for the sale of the public utility will be received and the manner of filing bids. The legislative body shall cause notice of the sale to be published for at least two weeks next before the day fixed for receiving bids in the manner provided in Section 10054 for publication of the ordinance calling for the election. If no newspaper is published in the municipality, the notice shall be posted in three public places therein for two succeeding weeks next before the date fixed for receiving bids.
At the date fixed for receiving bids the legislative body of the municipal corporation shall open and examine all bids received and may sell the public utility to the highest and best bidder therefor. If the bids received, in the opinion of the legislative body are inadequate or disproportionate to the value of the public utility the legislative body may reject all bids and may proceed to give new notice of the sale of the public utility in the manner provided in Section 10057.
When a bid is accepted by the legislative body of the municipal corporation, the legislative body may by resolution authorize its mayor, or president of its board of trustees, or other chief executive officer, and its clerk to execute, acknowledge, and deliver on behalf of the municipal corporation, in its name and under its corporate seal, a deed conveying the public utility to the successful bidder upon receiving from him in cash the full amount of the bid and the promise of the bidder to continue to operate the public utility. The deed shall operate to convey to the successful bidder all of the municipality’s right, title, interest, and estate in and to the public utility described in the deed.
The proceeds of the sale of the public utility shall be placed in the municipal treasury and shall be applied exclusively for the purposes and objects mentioned in the ordinance calling the election for the sale of the public utility.
Notwithstanding Article 1 (commencing with Section 10001) and this article, and except as provided in Section 37420.5 of the Government Code, a municipal corporation, by following the provisions of this section, may lease, sell, or transfer all or part of a public utility owned and operated by it for furnishing water or sewer service. As used in this section, “municipal corporation” means a city or a city and county.
Any municipal corporation owning and operating a public utility for furnishing water or sewer service, a part of which or all of which public utility is operated and used for furnishing water or sewer service outside the boundaries of the municipal corporation, may lease, sell, or transfer, for just compensation, all or any part of the portion of the public utility located outside the boundaries of the municipal corporation to any other municipal corporation, public agency, water corporation, or sewer system corporation upon the terms and conditions agreed upon by the selling municipal corporation if, by resolution adopted by a majority of its legislative body, it has determined that the public utility, or portion thereof, is not necessary for supplying water or sewer service to its own inhabitants and if the acquiring entity by resolution adopted by a majority of the members of its legislative body or board of directors has concurred in the lease, sale, or transfer and the terms and conditions thereof and if the acquiring entity will be bound to render water or sewer service to the persons formerly served through the system being sold on terms and conditions that are just and reasonable and do not unreasonably discriminate against the customers of the acquired entity.
Any municipal corporation owning and operating a public utility for furnishing water or sewer service may sell or transfer, for just compensation, all or any part of the public utility located inside its municipal boundaries to any other municipal corporation, public agency, water corporation, or sewer system corporation upon the terms and conditions agreed upon by the selling municipal corporation, if the sale or transfer is approved as follows:
The municipal corporation, by resolution adopted by a majority of its legislative body, has determined that the public utility, or portion thereof, is not necessary for supplying water or sewer services to its own inhabitants, or that its inhabitants will be provided with equal or better service by the acquiring entity on terms that are just and reasonable and do not discriminate against the customers of the acquired entity, and orders the issue submitted to the qualified voters of the municipality at a special or general election held for that purpose.
The acquiring entity by resolution adopted by a majority of its legislative body or board of directors has concurred in the sale or transfer and in the terms and conditions thereof.
The sale or transfer is approved by a majority of all voters voting on the issue in the election held for that purpose.
The municipal corporation, public agency, water corporation, or sewer system corporation proposing to acquire a municipal corporation public utility for furnishing water or sewer service shall disclose to the customers of the public water or sewer system to be acquired, not less than 30 days prior to the date of election for formal approval of the acquisition, a written statement which includes all of the following:
A summary of the price and terms of the proposed acquisition.
A comparison of the applicable water or sewer charges before and after the proposed acquisition.
The estimated savings to be achieved or additional costs expected to result, or both, from the proposed acquisition.
Subject to subdivision (e), a municipal corporation may lease a public utility furnishing water or sewer service by a resolution adopted by a majority of its legislative body and without lease term or other restrictions stated in any other law.
A municipal corporation acting pursuant to subdivision (c) shall specify the manner of soliciting and filing, and the method of evaluating, proposals for the acquisition of the public utility. Upon receipt and staff evaluation of a proposal or proposals the municipal corporation, if it determines that the proposal or proposals are responsive, shall schedule a public hearing, and notice thereof shall be published in accordance with Section 6066 of the Government Code. At the hearing, the municipal corporation shall examine proposals received and staff recommendations, and without lease term or other restrictions, may lease, sell, or transfer, for just compensation, the public utility to the entity that the municipal corporation finds best qualified to continue to provide equal or better service to the customers of the system. If the resolution proposes a sale, the resolution shall place the question on the ballot at the next regularly scheduled election or at a special election called for that purpose. The municipal corporation may, in its sole discretion, reject all proposals.
Any agreement entered into before September 17, 1965, between municipal corporations for the lease, sale, or transfer of all or any part of a public utility owned and operated by one of the municipal corporations and furnishing water service to the inhabitants of the municipal corporation to which the lease, sale, or transfer is made is hereby validated.
ARTICLE 3. Rights of Way [10101. - 10107.]
There is granted to every municipal corporation of the State the right to construct, operate, and maintain water and gas pipes, mains and conduits, electric light and power lines, telephone and telegraph lines, sewers and sewer mains, all with the necessary appurtenances, across, along, in, under, over, or upon any road, street, alley, avenue, or highway, and across, under, or over any railway, canal, ditch, or flume which the route of such works intersects, crosses, or runs along, in such manner as to afford security for life and property.
A municipal corporation exercising its rights under this article shall restore the road, street, alley, avenue, highway, canal, ditch, or flume so used to its former state of usefulness as nearly as may be, and shall locate its use so as to interfere as little as possible with other existing uses of a road, street, alley, avenue, highway, canal, ditch, or flume.
Before any municipal corporation uses any street, alley, avenue, or highway within any other municipal corporation or county, it shall request of the municipal corporation or county that has control over the street, alley, avenue, or highway to agree with it upon the location of the use and the terms and conditions to which the use shall be subject.
If the two municipal corporations, or a municipal corporation and a county, are unable to agree on the terms and conditions and location of a use within three months after a proposal to do so, the municipal corporation proposing to use a street, alley, avenue, or highway may bring an action in the superior court of the county in which the street, alley, avenue, or highway is situated against the other municipal corporation or the county to have the terms and conditions and location determined. The superior court may determine and adjudicate the terms and conditions to which the use of the street, avenue, alley, or highway shall be subject, and the location thereof, and upon the making of the final judgment the municipal corporation desiring to do so may enter and use the street, alley, avenue, or highway upon the terms and conditions and at the location specified in the judgment.
This article does not authorize the construction of any sanitary sewer within the territorial limits of any other municipality if the method of disposition of sewage therefrom is by discharging it in the Pacific Ocean within one mile of the territorial limits of the other municipality or in any manner that may create a public nuisance.
Nothing in this article limits in any respect the jurisdiction, powers, and duties vested by law in the Public Utilities Commission or, with respect to state highways, in the Department of Transportation. In the event of any conflict of jurisdiction, that of the Public Utilities Commission or the Department of Transportation, as the case may be, shall prevail.
ARTICLE 4. Rights in Public Lands and Waters [10151. - 10155.]
There is granted to every municipal corporation of the State the right of way for the location, construction, and maintenance of water works and works for the generation and distribution of electrical power, and for every necessary adjunct thereto, over any swamp, overflowed, or other public lands of the State not otherwise disposed of or in use, not in any case exceeding in length or width that which is necessary for the construction of the works or adjuncts, or for the protection thereof, and not in any case exceeding 100 feet in width along each side of the marginal limits of the works or adjuncts.
There is granted to every municipal corporation of the State the right to take from any of the lands belonging to the State adjacent to the works of such corporation, all materials, such as wood, stone, and earth, naturally appurtenant thereto, which are necessary and convenient for the original construction of the works and adjuncts.
There is granted to every municipal corporation of the State the right to take, in the manner provided by law, any waters belonging to the State, not otherwise disposed of, flowing or existing in any stream or lake intersected, crossed, or tapped by its water works, so far as is necessary to give such municipality and its inhabitants an ample supply of water for all municipal, domestic, irrigation, and manufacturing purposes.
If the route or location of any works or adjuncts is changed so as not to cover or cross the lands selected under this article, or the use of the land selected is abandoned, the selected lands revert, and the title thereto is reinvested in the State or its grantees free from all such uses.
When any selection of a right of way or land is made under this article by any municipal corporation, the legislative body thereof shall transmit to the State Lands Commission, State Controller, and recorder of the county in which the selected lands are situated, a verified plat of the lands selected, giving the extent thereof and the uses for which the lands are claimed or desired. If approved, the State Lands Commission shall so endorse the plat and issue to the corporation a permit to use the right of way and lands, unless on petition properly presented to a court of competent jurisdiction a review is had and such use prohibited.
ARTICLE 5. Permitted Use of Improvements [10201. - 10213.]
This article is intended to provide a means of making the work and improvements herein mentioned useful and beneficial to the lands or property assessed to pay the costs and expenses of the construction thereof. The powers herein granted are supplemental to any other powers granted by law to any county or city, and this article does not repeal any other powers to use or utilize such work or improvements.
When any legislative body elects to proceed under this article, the provisions hereof only shall apply and the limitations herein shall be followed.
This article and all of its provisions shall be liberally construed to the end that the purposes hereof may be effective.
“District,” as used in this article, includes any district for which the legislative body of any county or city may make contracts.
Whenever, under any street improvement act under which public work or improvements may be installed or constructed and the costs and expenses assessed in whole or in part against the lands or property benefited, there have been installed or constructed within any city or within the unincorporated territory of any county any wells, pumps, dams, reservoirs, storage tanks, channels, tunnels, conduits, pipes, hydrants, meters, or other appurtenances for supplying or distributing a domestic water supply, or all or any combinations thereof, and whenever there have been installed or constructed within any city or within the unincorporated territory of any county any mains, services, pipes, fittings, valves, regulators, governors, meters, drips, drains, tanks, ditches, tunnels, conduits, channels, or other appurtenances for supplying or distributing a domestic or industrial gas supply, or all or any combinations thereof, and no provision has been made for the maintenance, operation, and use of the work or improvement constructed, and the city owns no plant or system which can conveniently furnish water or gas, or the county owns no plant or system which can conveniently furnish the water or gas, the legislative body of the city or county, as the case may be, may grant permission to furnish water or gas therefor to any district, public corporation, mutual company, public utility company, private company, or individual.
Before granting such permission the legislative body of the county or city shall find that the public interest, convenience, and necessity require that the work or improvement be used, that water or gas is necessary therefor, and that a certain, named, district, public corporation, mutual company, public utility company, private corporation, or individual can most conveniently furnish water or gas. Thereupon the county or city may grant to such district, public corporation, mutual company, public utility company, private corporation, or individual the right to attach his lines or system to the work or improvement, and to furnish water or gas through the work or improvement to all lands which were assessed to pay the costs and expenses of constructing the work or improvement.
The permission shall be signed by the mayor or other chief executive of the city or by the chairman of the board of supervisors of a county, and by the person or authorized officers of the permittee.
The permission shall state the time for which it is given, which shall not exceed two years, and describe the work or improvement for which it is given, and shall require the permittee to maintain the work or improvement during the term of the permission, and to make all necessary repairs thereto during such term, and to furnish gas or water, as the case may be, to all lands assessed to pay all or any part of the costs and expenses of the work or improvement.
If any extensions of or additional installations for the work or improvement are necessary in order to serve all of the lands required to be served, the permittee shall not be obligated to make such extensions or additional installations, but shall permit any owner of such land to make the extensions and installations under reasonable regulations to be fixed by the city engineer or county surveyor, to attach them to the work or improvement, and to receive gas or water therefrom.
The permission shall provide that the charge made by the permittee for gas or water shall not be greater than the charge therefor made by the permittee for such service elsewhere, and shall provide that the permittee shall pay a reasonable charge, to be determined by the legislative body granting the permission, for the use of the work or improvement. Such rental shall be paid to the treasurer of the county or city at least semiannually and placed in a special fund, which shall be used for the improvement or replacement of the work or improvement or any part thereof.
The permission granted under this article to a private corporation or individual, not a public utility, and the furnishing of gas or water thereunder shall not be construed as a holding out or undertaking of such corporation or individual to serve any and all persons or as constituting the corporation or individual a public utility or as being any evidence thereof.
The permission shall expressly reserve to the legislative body granting it the right to terminate it whenever the city or county can conveniently furnish gas or water. If so terminated, the county or city shall thereafter furnish such gas or water.
The permission shall provide that if any district or public corporation is formed or extended, and if the district or public corporation can conveniently serve the territory with gas or water, any permission granted to any public utility, private corporation, or individual may be terminated by the legislative body. If permission is so terminated, the legislative body may grant permission to use the work or improvement and furnish gas or water to such district or public corporation in the manner and under the limitations provided in this article.
ARTICLE 6. Injury to Property [10251. - 10251.]
Any person who injures or destroys, through want of proper care, any necessary or useful facility or equipment of any municipal corporation is liable to the municipal corporation for all damages sustained thereby. The measure of damages to the facility or equipment injured or destroyed shall be the cost to repair or replace the property injured or destroyed including direct and allocated costs for labor, materials, supervision, supplies, tools, taxes, transportation, administrative and general expense and other indirect or overhead expenses, less credit, if any, for salvage. The specifying of the measure of damages for the facility or equipment shall not preclude the recovery of such other damages occasioned thereby as may be authorized by law.
ARTICLE 7. Financing Provisions [10301. - 10303.]
The Legislature finds and declares that financing the acquisition of privately owned facilities of an electrical or gas corporation by a municipal corporation not previously engaged in furnishing electricity or gas to customers on a regular and ongoing basis or by a redevelopment agency should be subject to the investigation and safeguards provided by this article in the public interest. The Legislature further finds and declares that the purpose of this article is to ensure that the power to acquire and operate these facilities is exercised in the wisest manner consistent with its grant and in the public interest.
As used in this article:
“Electrical corporation” means an electrical corporation as defined in Section 218.
“Gas corporation” means a gas corporation as defined in Section 222.
“Redevelopment agency” means a redevelopment agency as defined in Section 34102 of the Health and Safety Code.
The use of certificates of participation by a municipal corporation not previously engaged in furnishing electricity or gas to customers on a regular and ongoing basis, or the use of any evidence of indebtedness, including, but not limited to, certificates of participation, by a redevelopment agency, for the acquisition of all, or any portion, of the facilities of an electrical or gas corporation for the purpose of furnishing electricity or gas to customers is subject to an election held pursuant to Article 3 (commencing with Section 54380) of Chapter 6 of Part 1 of Division 2 of Title 5 of the Government Code, except that, in the case of any acquisition by a redevelopment agency, the term “qualified voters,” as used in Section 54380 of the Government Code, means those persons who would be served by the facilities proposed to be acquired.
DIVISION 6. MUNICIPAL UTILITY DISTRICT ACT [11501. - 14403.5.]
CHAPTER 1. General Provisions [11501. - 11536.]
ARTICLE 1. Definitions [11501. - 11509.]
This division may be cited as the “Municipal Utility District Act.”
Unless the context otherwise requires, the provisions of this article govern the construction of this division.
“District” means a municipal utility district formed under this division or under Chapter 218 of the Statutes of 1921, as originally enacted or subsequently amended; “special district” means a special district for sewage disposal or solid waste resource recovery purposes created under this division or under Chapter 218 of the Statutes of 1921, as originally enacted or subsequently amended; and “board” means the board of directors of a district.
“Public agency” includes a city, county water district, county sanitation district, or sanitary district.
“Voter” means any elector who is registered under the Elections Code.
“Sewage disposal” means the acquisition, construction, enlargement, operation, and maintenance of intercepting sewers, sewage treatment works, pumping plants, outfall sewers, and appurtenances.
“Percent of the total vote cast,” when used with reference to the requirements of any petition or nomination paper, means percent of the total vote cast, exclusive of vote by mail ballots, within the proposed district, district, proposed special district, special district, or territory proposed to be annexed to a district, as the case may be at the last statewide general election.
“Solid Waste Resource Recovery” means the acquisition, construction, enlargement, operation, and maintenance of facilities for the purpose of collecting, reducing, separating, recovering, converting, and recycling solid waste, and for the purpose of disposing of solid waste residues.
“Electricity district” means a municipal utility district formed under this division that furnishes electricity to more than 100,000 customers.
ARTICLE 2. General Provisions [11531. - 11536.]
A municipal utility district may be created as provided in this division and when so created may exercise the powers herein granted.
All persons who, at the time this division goes into effect, hold offices under Chapter 218 of the Statutes of 1921, as originally enacted or subsequently amended, continue to hold them according to their former tenure.
Except as otherwise provided in this division elections shall be held and conducted and the result ascertained, determined, and declared in all respects as nearly as practicable in conformity with the general election laws of the State.
Except as otherwise provided in this division all ordinances, summaries of ordinances, and notices that are required to be published shall be published once a week for two successive weeks (two publications) in a newspaper of general circulation published within the district.
Whenever in this division publication in a newspaper of general circulation published within the district is required, and there is no such newspaper, then the publication may be made in a newspaper of general circulation published in any county where the district is situated.
Whenever the signature of any officer or employee of a district or of any member of the Retirement Board or of any officer or employee of the Retirement System is authorized or required under the provisions of this division, except in the single instance provided in Section 13244, the signature may be made by the use of a plate bearing facsimiles of such signatures.
CHAPTER 2. Formation of Districts [11561. - 11701.]
ARTICLE 1. General Provisions [11561. - 11562.]
Any public agency together with unincorporated territory, or two or more public agencies, with or without unincorporated territory, may organize and incorporate as a municipal utility district. Public agencies and unincorporated territory included within a district may be in the same or separate counties and need not be contiguous. No public agency shall be divided in the formation of a district.
A request for the formation of a district may be made by resolution or by petition as set out in this chapter.
ARTICLE 2. Request by Resolution [11581. - 11583.]
Legislative bodies of half or more of the public agencies proposed to be included in the proposed district may pass resolutions declaring that in their opinion public interest or necessity demands the creation and maintenance of a municipal utility district to be known as the “(giving the name) municipal utility district.”
The resolutions may state the kind of utility proposed to be first acquired, but failure to acquire such utility shall not affect the validity of the district. They shall describe the exterior boundaries of the proposed district, except that if it is intended to organize the district of public agencies only, a statement of the names of such public agencies is a sufficient and legal description of the district.
Certified copies of the resolutions shall be presented to the board of supervisors of the county containing the largest number of voters within the proposed district, requesting that board of supervisors to call an election without delay for determining whether the district will be created.
ARTICLE 3. Request by Petition [11611. - 11614.]
Instead of resolutions, a petition may be presented to the board of supervisors of the county containing the largest number of voters within the proposed district, signed by voters within the proposed district equal in number to at least 10 percent of the total vote cast.
The petition shall contain substantially the same declarations and statements required to be contained in the resolutions presented to a board of supervisors under this chapter, and declare that, in the opinion of the petitioners, public interest or necessity demands the creation and maintenance of a municipal utility district.
The petition may be on separate papers, but each paper shall contain the affidavit of the person who circulated it certifying that each name signed thereto is the true signature of the person whose name it purports to be.
The clerk of the board of supervisors of the county in which the petition is presented shall compare the signatures to the petition with the affidavits of registration and certify to their sufficiency or insufficiency.
ARTICLE 4. Election [11641. - 11656.]
Upon receipt of certified copies of the resolutions or of a sufficient petition, the board of supervisors to whom they are presented shall call an election within the proposed district without delay, to be held on the next established election date not less than 74 days after the date of the order calling the election, for the purpose of determining whether the proposed district will be created and established, and for the purpose of electing the first board of directors therefor in case the district is created.
Before calling the election the board of supervisors shall divide the proposed district into five wards, the boundaries of which shall be so drawn that each shall contain approximately an equal number of voters, as nearly as may be. The public agencies and any other territory included in the proposed district may be divided for the purpose of establishing ward boundaries.
Upon establishing the wards, the board of supervisors shall publish notice of the election within the proposed district.
Within five days after the district formation election has been called, the legislative body which has called the election shall transmit, by registered mail, a written notification of the election call to the executive officer of the local agency formation commission of the county or principal county in which the territory or major portion of the territory of the proposed district is located. Such written notice shall include the name and a description of the proposed district, and may be in the form of a certified copy of the resolution adopted by the legislative body calling the district formation election.
The executive officer, within five days after being notified that a district formation election has been called, shall submit to the commission, for its approval or modification, an impartial analysis of the proposed district formation.
The impartial analysis shall not exceed 500 words in length and shall include a specific description of the boundaries of the district proposed to be formed.
The local agency formation commission, within five days after the receipt of the executive officer’s analysis, shall approve or modify the analysis and submit it to the officials in charge of conducting the district formation election.
The board of supervisors or any member or members of the board authorized by the board, or any individual voter or bona fide association of citizens entitled to vote on the district formation proposition, or any combination of such voters and associations of citizens, may file a written argument for or a written argument against the proposed district formation.
Arguments shall not exceed 300 words in length and shall be filed with the officials in charge of conducting the election not less than 54 days prior to the date of the district formation election.
If more than one argument for or more than one argument against the proposed district formation is filed with the election officials within the time prescribed, such election officials shall select one of the arguments for printing and distribution to the voters.
In selecting the arguments, the election officials shall give preference and priority in the order named to the arguments of the following:
The board of supervisors or any member or members of the board authorized by the board.
Individual voters or bona fide associations of citizens or a combination of such voters and associations.
The officials in charge of conducting the election shall cause a ballot pamphlet concerning the district formation proposition to be voted on to be printed and mailed to each voter entitled to vote on the district formation question.
The ballot pamphlet shall contain the following in the order prescribed:
The complete text of the proposition.
The impartial analysis of the proposition prepared by the local agency formation commission.
The argument for the proposed district formation.
The argument against the proposed district formation.
The election officials shall mail a ballot pamphlet to each voter entitled to vote in the district formation election at least 10 days prior to the date of the election. The ballot pamphlet is “official matter” within the meaning of Section 13303 of the Elections Code.
The notice shall state the name of the proposed district, and describe the boundaries thereof and the boundaries of the wards provided for the purpose of electing directors.
The ballot for the election shall contain such instructions as are required by law to be printed thereon and in addition thereto the following:
The ballots shall also contain the names of the persons nominated in each ward to serve as a member of the board from such ward, showing separately each ward and its nominees.
Any person may be nominated for the office of director upon written petition of at least 50 voters of the ward in which such person resides.
Candidates for the office of director shall be voted upon at large, and every voter in the proposed district may vote for all of the directors to be elected.
No person shall be entitled to vote at the election unless he is a voter of the territory included in the proposed district.
The election may be held on the same day as any other state, county, or city election, and be consolidated therewith.
The board of supervisors which called the election shall meet on Monday next succeeding the day of the election and canvass the votes cast thereat.
The board of supervisors shall canvass, separately, the returns of each public agency and each parcel of unincorporated territory, if any.
Subject to subdivision (c), the board of supervisors shall declare a district created and established of those public agencies and parcels of unincorporated territory in which a majority of those persons who voted did so in favor of the creation of the district. Those public agencies and parcels of unincorporated territory in which a majority of those persons voting did not vote in favor of the creation of the district shall be excluded from the district.
A district may be created and established pursuant to subdivision (b) only if the number of registered voters in the approving public agencies and parcels of unincorporated territory is two-thirds or more of the total number of registered voters within the district as proposed to the voters.
No person may serve as a director unless he is a resident and voter of the district as finally determined. Any vacancies on the board caused by the elimination of territory shall be filled by appointment by the remaining directors, in which case ward lines may be disregarded.
The board of supervisors shall also canvass the returns of the election with respect to the persons voted for as directors, and shall declare the persons receiving the highest number of votes, for each ward, respectively, to be duly elected as directors of the district, if they are residents and voters thereof as finally determined.
The board of supervisors calling the election shall make all provision for the holding thereof throughout the entire district as proposed, and shall pay the cost thereof.
If a special election is held exclusively on the proposition of organizing a district, the expenditure therefor shall be reimbursed to the county which called the election by means of a tax on all the taxable property within the public agencies and unincorporated territory which was proposed to be included in the district, and this tax shall be added to the next county tax bills by the proper officials of the counties involved, respectively.
ARTICLE 5. Establishment of the District [11681. - 11681.]
The board of supervisors shall cause a certified copy of the order declaring the result of the election to be filed in the Office of the Secretary of State, from and after which the establishment of the district shall be deemed complete.
ARTICLE 6. Contest of Incorporation [11701. - 11701.]
No informality in any proceeding or in the conduct of any election, not substantially affecting adversely the legal rights of any citizen, shall be held to invalidate the incorporation of any district. Any proceedings wherein the validity of incorporation is denied shall be commenced within three months from the date of filing the order declaring the result of the election with the Secretary of State, otherwise the incorporation and the legal existence of the district shall be held to be valid and in every respect legal and incontestable.
CHAPTER 3. Internal Organization of Districts [11801. - 11950.]
ARTICLE 1. Government [11801. - 11801.]
The government of every district is vested in a board of five directors, one from each ward, together with the other officers mentioned in this division. The directors shall be residents and voters of the respective wards from which they are nominated.
ARTICLE 2. Election of Directors [11821. - 11832.]
The first directors are elected at the formation election as provided in Chapter 2. All elections of directors subsequent to the first shall be held at the same time as the general election in the manner provided in this article.
Notice of election shall be published and no other notice of such election need be given.
The board shall by resolution or ordinance fix the boundaries of the wards for the purpose of electing directors therefrom. The board of directors shall, by resolution, adjust the boundaries of any wards pursuant to Chapter 8 (commencing with Section 22000) of Division 21 of the Elections Code.
The notice of election shall refer to the wards established by the board.
Not more than 113 days prior to the election, upon request, the county elections official of the principal county containing the majority of the population of the ward from which the candidate is seeking election shall issue nomination papers and all other forms required for nomination to the office of director.
Nomination papers may be circulated throughout the district.
Except as otherwise provided in this division, the provisions of the Elections Code prescribed for independent nominations shall substantially govern the manner of appointment of circulators, the form of nomination papers and other forms, the securing of signatures, the filing of the candidate’s declaration of candidacy, and all other things necessary to get the name of the candidate upon the ballot. At the time of issuance of nomination papers, the county elections official shall cause to be entered on the first page of each section of the nomination papers the name of the candidate and the office for which he or she is a candidate. The county elections official shall imprint a stamp on the first page of each section of the nomination papers which reads “Official Filing Form,” and shall affix his or her signature. The county elections official shall keep a list containing the name and address of each candidate, the office for which he or she is a candidate, and the date on which the nomination papers were issued, which list shall be a public record.
Circulators may obtain signatures to the nomination paper of any candidate at any time not more than 113 days nor less than 88 days prior to the election. Each section of the nomination papers shall bear the name of a county and only qualified voters of that county shall sign the section. Nomination papers shall be signed either by 1 percent or by 10 of the registered voters from within the district, whichever is the lesser number, but in no event by more than 20 registered voters from within the district. Nomination papers shall be filed with the county elections official of the principal county containing the majority of the population of the ward from which the candidate is seeking election not more than 113 nor less than 88 days before the date of the election and shall be examined by the county elections official. If nomination papers for an incumbent director are not filed by 5 p.m. on the 88th day before the election, the voters shall have until 5 p.m. on the 83rd day before the election to nominate candidates other than the incumbent for that office. As soon as possible under the circumstances, the county elections official shall determine the number of valid signatures. If there are less than 10 valid signatures, the county elections official shall notify the candidate of that fact, and shall accept additional valid signatures at any time prior to the close of the period for circulating nomination papers. Each candidate, at least 88 days prior to the election, shall file a sufficient candidate’s declaration of candidacy with the county elections official with whom he or she filed the nomination papers. The county elections official shall certify the names of all candidates at least 76 days prior to the date of the election so that their names may be placed upon the ballot.
The board shall in the notice, ordinance, or resolution calling an election consolidate it with the general election to be held at the same time in the respective counties in which the district is located and authorize the respective boards of supervisors to canvass the returns and certify the result of the canvass to the board. It shall be the duty of the board or boards of supervisors to so consolidate the election, canvass the returns, and cause the result thereof to be properly certified to the board of directors of the district. The election shall be held in all respects as if there were only one election, and only one ticket or ballot shall be used. When the county precinct boundaries do not coincide with the boundaries of the wards in the district, the board or boards of supervisors shall, for the purpose of the election only, reprecinct the territory in which the boundaries do not coincide, at least 30 days before the election.
Candidates for the office of director shall be voted upon at large, and every voter in the district may vote for all of the directors to be elected.
Upon receipt of the returns of the canvass by the respective boards of supervisors the board shall meet and determine results of the election and declare the candidate or candidates elected.
The secretary of the district shall issue certificates of election, signed by him and duly authenticated, immediately following the determination of the result of the election by the board.
ARTICLE 2.5. Additional Directors [11850. - 11855.]
Notwithstanding any other provision of this chapter, in any district formed prior to January 1, 1974, and containing a population of 1,000,000 or more on that date, the number of directors on the district board shall be increased from five to seven as provided in this article.
In any district to which subdivision (a) is applicable and in any district which has owned and operated an electric distribution system for at least eight years and which has a population of 250,000, or more, candidates for the office of director shall be elected by the voters of the ward each represents and shall not be voted upon at large. Nomination papers may be circulated only within the ward from which the candidate is to be elected, and shall be signed either by 1 percent of the voters within the ward or by 10 voters, whichever is the lesser number, but in no event by more than 20 voters within the ward. District circulators shall be residents of the ward in which they seek signatures and may obtain signatures only from registered voters residing within that ward.
In any district in which the number of directors is required to be increased from five to seven as provided in Section 11850, the board of directors in office on January 1, 1974, shall, by resolution or ordinance adopted within 90 days after such date, divide the territory of the district into seven wards, and fix the boundaries thereof. The boundaries shall be fixed such that the wards are as equal in number of registered voters as may be.
The two additional directors provided for by this article shall be nominated and elected in the manner and at the election called and conducted within the district for the election of district directors pursuant to Article 2 (commencing with Section 11821) of this chapter and held at the same time as the 1974 statewide general election.
Notwithstanding any other provision of law, if, in a district subject to this article, by 5 p.m. on the 83rd day prior to the day fixed for the general election, no one or only one person has filed a declaration of candidacy for a particular ward, the county elections official shall submit a certificate of these facts to the district board and inform the board that it may, at a regular or special meeting held on or before the 76th day prior to the election, adopt one of the following courses of action:
If only one person has filed a declaration of candidacy for a ward, appoint that person to the office.
If no one has filed a declaration of candidacy for a ward, appoint a person to the office who would be qualified on the date the election would have been held.
If either no one or only one person has filed a declaration of candidacy for a ward, hold the election.
If the board makes an appointment pursuant to subdivision (a), the elections official shall not accept for filing any statement of write-in candidacy that is submitted after the appointment is made. The person appointed, if any, shall qualify and take office and serve exactly as if elected at an election for the office.
If by the 76th day prior to the day fixed for the election, the district board has not appointed the sole candidate to the office pursuant to paragraph (1) of subdivision (a) or has not adopted a process to appoint, or appointed, a qualified person to the office pursuant to paragraph (2) of subdivision (a), the election shall be held.
A district board may adopt a process to appoint a qualified person to the office pursuant to paragraph (2) of subdivision (a). Upon adoption of this process, the district board shall appoint a qualified person to office no later than the day fixed for the election.
This section shall apply to all elections held in any district subject to this article that takes place on or after January 1, 2014.
The two additional directors elected pursuant to this article shall take office immediately upon the issuance of the certificates of election by the secretary of the district. Thereafter, directors elected pursuant to the additional seats created by this article shall take office on the first day of January next following their election.
The term of office of the additional directors elected pursuant to this article shall be four years and until their successors are elected and qualified.
Nothing in this article shall effect the term of office of district directors in office on the effective date of this section.
ARTICLE 2.7. Sacramento Municipal Utility District [11857. - 11857.5.]
Notwithstanding any other provision of this chapter, in the Sacramento Municipal Utility District, the number of directors on the district board shall be increased from five to seven as provided in this article.
To effectuate the increase as provided in Section 11857, the board of directors in office on January 1, 1994, shall, by resolution or ordinance adopted within 90 days after that date, divide the territory of the district into seven wards, and fix the boundaries thereof. The boundaries shall be fixed so that the wards are as equal in population as may be.
The two additional directors provided for by this article shall be nominated and elected in the manner and at the election called and conducted within the district for the election of district directors pursuant to Article 2 (commencing with Section 11821) of this chapter and held at the same time as the 1994 statewide general election.
The two additional directors elected pursuant to this article shall take office immediately upon the issuance of the certificates of election by the secretary of the district. Thereafter, directors elected pursuant to the additional seats created by this article shall take office on the first day of January next following their election.
The term of office of the additional directors elected pursuant to this article shall be four years and until their successors are elected and qualified.
Nothing in this article shall affect the term of office of district directors in office on the effective date of this section.
ARTICLE 3. Terms of Office of Directors [11861. - 11865.]
The directors elected at the formation election shall hold their respective offices only until the first day of January next following the next general election and until their successors are elected and qualified.
Of the directors elected at the first election following the formation election, those three elected by the highest vote shall hold office for four years, and the other two for two years, and until their successors are elected and qualified. Thereafter, at each biennial general election, a number of directors corresponding to the number whose terms of office expire shall be elected for the term of four years.
Directors elected at the formation election shall enter upon their official duties immediately upon the filing of the order declaring the result of the election with the Secretary of State, after qualifying according to law. The terms of directors elected after the formation election shall commence on the first day of January next following their election.
Vacancies on the board shall be filled as provided in this section:
The remaining board members may fill the vacancy by appointment. The person appointed to fill the vacancy shall hold office until the person elected at the next district general election that is scheduled 90 or more days after the effective date of the vacancy has been qualified and takes office. The appointment shall be made within a period of 60 days immediately subsequent to the effective date of the vacancy. A notice of the vacancy shall be posted in three or more conspicuous places in the district at least 15 days before the appointment is made.
In lieu of making an appointment, the remaining members of the board may within 60 days of the vacancy call a special election to fill the vacancy. The person elected at the special election shall hold office for the remainder of the term in which the vacancy occurred.
If the vacancy is not filled by appointment as provided in paragraph (1) of subdivision (a), or if the board has not called for a special election within 60 days of the vacancy as provided in paragraph (2) of subdivision (a), the board of supervisors of the county representing the larger portion of the district area in which the election to fill the vacancy will be held may fill the vacancy by appointment within 90 days of the effective date of the vacancy or may order the district to call a special election to fill the vacancy.
If within 90 days of the effective date of the vacancy, the remaining members of the board or the appropriate board of supervisors have not filled the vacancy by appointment and no election has been called for, the district shall call a special election to fill the vacancy.
A person elected at an election to fill a position to which an appointment was made pursuant to this section shall take office immediately upon issuance of the certificate of election by the secretary of the district, after qualifying according to law, and shall hold office for the remainder of the term in which the vacancy occurs.
ARTICLE 4. Powers and Duties of Directors [11881. - 11895.]
The oath of office of directors shall be taken, subscribed, and filed with the secretary of the district at any time after the director has notice of his election or appointment but not later than 15 days after the commencement of his term of office. No other filing is required.
The board shall choose one of its members president, and another vice president, who shall be authorized to act for the president during his absence or disability, and shall provide for the time and place of holding its meetings, which shall be held at least once each month.
The board is the legislative body of the district and determines all questions of policy.
All matters and things necessary for the proper administration of the affairs of the district which are not provided for in this division shall be provided for by the board.
The board shall supervise and regulate every utility owned and operated by the district, including the fixing of rates, rentals, charges, and classifications, and the making and enforcement of rules, regulations, contracts, practices, and schedules, for or in connection with any service, product, or commodity owned or controlled by the district.
The board shall by resolution determine and create such number and character of positions as are necessary properly to carry on the functions of the district and shall establish an appropriate salary, salary range, or wage for each position so created. The board may by resolution abolish any such position. Except as otherwise provided, appointments to such positions shall be made by the general manager in accordance with the civil service provisions applicable thereto.
The board of a district which has owned and operated an electric distribution system for at least eight years and has a population of 250,000 or more may delegate to the general manager the authority to take any or all of the actions provided for in Section 11886.
The board of any district having 600 or more employees may appoint not to exceed 15 employees to positions requiring peculiar and exceptional qualifications, including those of a scientific, professional, or expert character or of special confidence.
The board of a district which has owned and operated an electric distribution system for at least eight years and has a population of 250,000 or more may, notwithstanding Section 11887, determine that additional positions requiring peculiar and exceptional qualifications, including, but not limited to, those of a scientific, professional, or expert character or of special confidence, or positions with significant managerial responsibility, shall be exempt from the district civil service if the total number of these exempt positions, including the exempt positions filled pursuant to Section 11887, does not exceed 5 percent of the total civil service positions of the district. However, the board may not determine any position to be exempt as long as that position is filled by an employee appointed pursuant to the district civil service.
The board of a district which has owned and operated an electric distribution system for at least eight years and has a population of 250,000 or more may, notwithstanding any other provision of this division, appoint or remove only those officers or employees who are exempt from the district civil service and who either report directly to the board or report to another officer who reports directly to the board. All other officers and employees exempt from the district civil service shall be appointed by, and serve at the pleasure of, the general manager.
The board may contract for the services of any officer who reports directly to the board or who reports to an officer who reports directly to the board and may authorize the general manager to contract for the services of other officers and exempt employees. The term of these contracts may not exceed five years in duration.
The board may from time to time contract for or employ any professional service required by the district or for the performance of work or services which cannot satisfactorily be performed under the civil service provisions of this division.
The board shall employ an expert who shall examine and report, at least annually, upon the system of accounts kept by the district.
The salaries or wages of all officers and employees of a district shall be paid periodically as the board may prescribe. At the expiration of the period fixed for the payment of salaries or wages a payroll shall be prepared, showing all persons employed during the preceding salary period and stating the amount of compensation to which each person is entitled. Payment of the salary or wages of each person specified in the payroll may be made after approval of the payroll by the board or the general manager in accordance with rules adopted by the board.
The board may provide by resolution, under such terms and conditions as it sees fit, for the payment of demands against the district without prior specific approval thereof by the board if the demand is for a purpose for which an expenditure has been previously approved by the board and in an amount not greater than the amount so authorized, and if the demand is approved by the general manager.
The board of any district which has owned and operated a water distribution system for at least 10 years and which maintains a system of accounting substantially in accordance with the Uniform System of Accounts for Water Utilities prescribed by the Public Utilities Commission may provide, by resolution, under the terms and conditions as it sees fit, for the payment, without prior specific approval by the board, of demands against the district which relate to obligations incurred for purposes and within the amounts specified for those purposes in a projection of the district’s operations for a period of not longer than one year, if the demands are approved by the general manager. The projection shall be expressed in terms of the major groups of accounts in the uniform system of accounts and shall be incorporated in the resolution.
The board of a district which has owned and operated an electric distribution system for at least eight years and has a population of 250,000 or more which maintains a system of accounting substantially in accordance with the Uniform System of Accounts for Electrical Corporations prescribed by the Public Utilities Commission, or any other generally accepted accounting system, may provide, by resolution, under the terms and conditions as it sees fit, for the payment, without prior specific approval by the board, of demands against the district which relate to obligations incurred for purposes and within the amounts specified for those purposes in a projection of the district’s operations for a period of not longer than one year, if the demands are approved by the general manager. The projection shall be expressed in terms of the major groups of accounts in the system of accounts and shall be incorporated in the resolution.
To facilitate the business of the district, the board may provide for the creation and administration of revolving funds as the needs of the district may require. The aggregate amount of the revolving funds shall not exceed one hundred thousand dollars ($100,000). The revolving funds shall be disbursed in accordance with rules established by the board, and all payments from any revolving fund shall be reported to the board and vouchers filed therefor.
Notwithstanding Section 11892, the board of a district which has owned and operated an electric distribution system for at least eight years and has a population of 250,000 or more may, to facilitate the business of the district, provide for the creation and administration of revolving funds as the needs of the district may require. The aggregate amount of the revolving funds shall not exceed two hundred thousand dollars ($200,000). The revolving funds shall be disbursed in accordance with the rules adopted by the board, and all payments from any revolving fund shall be reported to the board and vouchers filed therefor.
If a legal holiday falls on a Saturday, the board may provide by resolution that the Friday preceding is a holiday within the district for the purpose of closing its offices and excusing its employees from work.
The board may provide by resolution, if necessary to implement a memorandum of understanding adopted pursuant to Chapter 10 (commencing with Section 3500) of Division 4 of Title 1 of the Government Code, that the Friday following the Thursday in November appointed as Thanksgiving Day is a holiday within the district for the purpose of closing its offices and excusing its employees from work.
A district may, by resolution adopted by a majority of the board, change its name. A certified copy of the resolution changing the name of the district shall be recorded in each county included in whole or in part within the district and shall be transmitted to the Treasurer.
ARTICLE 5. Meetings and Legislation [11907. - 11912.]
A majority of the board constitutes a quorum for the transaction of business.
The board shall establish rules for its proceedings and may provide, by ordinance or resolution, that each member shall receive for each attendance at the meetings of the board, or for each day’s service rendered as a director by request of the board, the sum of one hundred dollars ($100). No director shall receive any other compensation, nor receive pay for more than six days in any one calendar month. For purposes of this section, the determination of whether a director’s activities on any specific day are compensable shall be made pursuant to Article 2.3 (commencing with Section 53232) of Chapter 2 of Part 1 of Division 2 of Title 5 of the Government Code.
Notwithstanding Section 11908, a district with a board having seven directors may provide, by resolution or ordinance, that each director shall receive compensation in an amount not to exceed one hundred dollars ($100) per day for each day’s attendance at public meetings of the board or for each day’s service rendered as a director by request of the board, not exceeding a total of six days in any calendar month, or, in lieu of that compensation, a salary of not to exceed six hundred dollars ($600) per month subject to annual adjustments pursuant to subdivision (b), together with any expenses incurred in the performance of his or her duties required or authorized by the board. No resolution or ordinance establishing compensation pursuant to this subdivision shall provide for any automatic increase in that compensation.
Any district which adopts salaries for directors pursuant to subdivision (a) may increase those salaries by not more than 5 percent for each calendar year following the operative date of the last adjustment, commencing with the calendar year following adoption of the salary or increase.
Notwithstanding Section 11908, the board of a district which has owned and operated an electric distribution system for at least eight years and has a population of 250,000 or more may provide, by ordinance or resolution, that each director shall receive compensation in an amount not to exceed one hundred dollars ($100) per day for each day’s attendance at public meetings of the board or for each day’s service rendered as a director by request of the board, not exceeding a total of 10 days in any calendar month, together with any expenses incurred in the performance of his or her duties required or authorized by the board. The board may, by resolution or ordinance, increase the compensation per day by not more than 5 percent for each calendar year following the operative date of the last adjustment, commencing with the 1988 calendar year. No resolution or ordinance establishing compensation pursuant to this subdivision shall provide for any automatic increase in that compensation. For purposes of this section, the determination of whether a director’s activities on any specific day are compensable shall be made pursuant to Article 2.3 (commencing with Section 53232) of Chapter 2 of Part 1 of Division 2 of Title 5 of the Government Code. Reimbursement for these expenses is subject to Sections 53232.2 and 53232.3 of the Government Code.
The acts of the board shall be expressed by motion, resolution, or ordinance. No ordinance, resolution, or motion shall have any validity or effect unless passed by the affirmative votes of at least three directors of a five-ward district, or at least four directors of a seven-ward district.
No ordinance shall be passed by the board within five days of the day of its introduction or at any time other than a regular or adjourned regular meeting. All ordinances or summaries of ordinances shall be published after passage.
The publication of ordinances, as required by subdivision (a), may be satisfied by either of the following actions:
Within 15 days after adoption of the ordinance or amendment to an ordinance, the board of directors shall publish a summary of the ordinance or amendment with the names of those directors voting for and against the ordinance or amendment and the secretary shall post in the office of the secretary of the board of directors a certified copy of the full text of the adopted ordinance or amendment along with the names of those directors voting for and against the ordinance or amendment.
If the general manager determines that it is not feasible to prepare a fair and adequate summary of the adopted ordinance or amendment, and if the board of directors so orders, within 15 days after adoption of the ordinance or amendment to an ordinance, a display advertisement of at least one-quarter of a page shall be published. The advertisement shall indicate the general nature of, and provide information about, the proposed or adopted ordinance or amendment, including information sufficient to enable the public to obtain copies of the complete text of the ordinance or amendment, and the names of those directors voting for and against the ordinance or amendment.
The enacting clause of all ordinances shall be as follows:
“Be it enacted by the board of directors of ________ municipal utility district:”
All ordinances shall be signed by the president of the board or the vice president, and attested by the secretary.
ARTICLE 6. Other Officers [11926. - 11942.]
The board shall appoint and fix the salary of a general manager, who shall have full charge and control of the construction of the works of the district and of their maintenance and operation, and also of the administration of the business affairs of the district.
All other things being equal, the board shall appoint as general manager some person who has had experience in municipal engineering or in the construction or management of public utilities.
The general manager need not be a resident of this State at the time of his appointment.
The general manager shall hold office for an indefinite term and may be removed by the board only upon the adoption of a resolution by the affirmative vote of not less than three members of the board of a five-ward district, or four members of the board of a seven-ward district. Before the general manager may be removed, he shall, if he demands it, be given a written statement of the reasons alleged for his removal and he shall have the right to be publicly heard thereon at a meeting of the board prior to the final vote on the resolution providing for his removal, but pending and during such hearing the board may suspend him from office. The board may not reduce the salary of the general manager below the amount fixed at the time of his original appointment except upon the adoption of a resolution by a like vote and after a like opportunity to be heard. The action of the board in suspending or removing the general manager or reducing his salary, if approved by a majority of the membership of the board, is final.
Notwithstanding this article, until such time as the district has operated, controlled, or used works or parts of works for providing the inhabitants and public agencies within the boundaries of the district with the utility services, or any of them, specified in this division, for a period of six months, the board may or may not appoint a general manager, who during such time holds office at the pleasure of the majority of the board.
The board may appoint an accountant, a secretary, a treasurer, and an attorney, who shall hold office during the pleasure of the board.
The attorney shall be admitted to practice law in the Supreme Court of the State, and shall have been actively engaged in the practice of his profession for not less than three years next preceding his appointment.
The board may also provide for assistants to any officer of the district who shall hold office at the pleasure of the board and may perform any and all acts that their principal may perform, when authorized so to do by the board.
The board may consolidate any of the district offices in one person.
The oath of office of all appointive officers of the district shall be taken, subscribed, and filed with the secretary of the district at any time after the officer has notice of his appointment but not later than 15 days after the commencement of his term of office. No other filing is required.
Each appointive officer shall give such bond and in such amount as the board may require.
The powers of the general manager are:
To see that all ordinances of the district are enforced.
To administer the civil service system of the district and, except as otherwise provided in this division, to appoint to the positions created by the board which are subject to the civil service provisions of this division, such employees as are necessary for the administration of the affairs of the district, and to remove such employees, in accordance with the provisions of the civil service system.
To attend all meetings of the board and submit a general report of the affairs of the district.
To keep the board advised as to the needs of the district.
To prepare or cause to be prepared all plans and specifications for the construction of the works of the district.
To devote his entire time to the business of the district.
To perform such other and additional duties as the board may require.
The general manager shall within 90 days from the end of each fiscal year cause to be published a summary of the financial report showing the result of operations for the preceding fiscal year and the financial status of the district on the last day thereof. The publication shall be made in the manner provided in this division for the publication of ordinances and notices generally.
The attorney shall take charge of all suits and other legal matters to which the district is a party or in which it is legally interested. He shall give his advice or opinion in writing whenever required by the board. He shall be the legal adviser of the general manager and other district officers and shall prepare and approve the forms of all ordinances, resolutions, contracts, bonds, and other legal documents connected with the business of the district. He shall perform such other and additional services as the board may require.
The accountant shall install and maintain a system of auditing and accounting which shall completely and at all times show the financial condition of the district and provide reasonable assurance that the financial transactions of the district were executed in accordance with the instructions of the board. The accountant shall prepare all instruments necessary for the payment of demands against the district in accordance with the instructions of the board. The accountant shall perform such other duties as the board may require.
The treasurer shall be the custodian of the funds of the district and shall make payments and execute instruments for the payment of demands against the district after determination by the accountant that the demands are authorized. The treasurer shall keep an account of all receipts and disbursements.
With the consent of the board, the treasurer may:
Authorize the trust department of any state or national bank, or a trust company authorized to act as such, to receive as his agent deposits of any securities acquired by the district.
Place and maintain for safekeeping as a trust deposit with the trust department of any state or national bank, or a trust company authorized to act as such, any securities owned by the district.
The bank or trust company selected shall have a total paid-in capital of at least one million dollars ($1,000,000). The treasurer shall take from the trust department or trust company a receipt for the securities, and neither the treasurer nor the district is responsible for the custody and safe return of the securities until they are withdrawn from the trust department or trust company by the treasurer. Any trust department or trust company to which securities are delivered, either as agent or depositary for the treasurer, shall make such disposition of the securities as the treasurer directs and is responsible only for strict compliance with written instructions given to it by the treasurer. All such securities are at all times subject to the order of the treasurer.
ARTICLE 7. Initiative and Referendum [11950. - 11950.]
The initiative and referendum provisions of Chapter 4 (commencing with Section 9300) of Division 9 of the Elections Code shall apply to every municipal utility district.
CHAPTER 4. Civil Service System [12051. - 12167.]
ARTICLE 1. Establishment [12051. - 12055.]
The general manager shall adopt a civil service system for the selection, examination, employment, classification, advancement, suspension, and discharge of employees included in the “district civil service.”
The general manager shall adopt rules and regulations to carry out the purposes of the civil service provisions of this division and may from time to time amend existing rules. Except as otherwise provided herein such rules shall govern applications, examinations, eligibility, duration of eligible lists; certifications of eligibles; appointments; promotions; transfers; resignations; layoffs or reductions in force, both permanent and temporary, due to lack of work or funds, retrenchment, or completion of work; the filling of positions, temporary, seasonal, and permanent; classification; and such other matters as are not in conflict with the civil service provisions of this division.
The rules and regulations or any proposed amendments thereto shall be in writing and a copy thereof shall be posted in a conspicuous place in the office of the district and shall not become effective until 20 days after the posting thereof. The board may require that such rules and regulations or amendments thereof be submitted to it for approval prior to posting. Any person interested may within 10 days after such posting file written objections to such proposed rules or amendments, or any part thereof, with the general manager, in which event the rules or amendments shall not become effective until the general manager has given notice of a hearing and heard objections thereto and announced his decision on the objections.
The civil service provisions of this chapter do not apply to any district until such time as it has operated, controlled, or used works or parts of works for the providing of any of the utility services specified in this division. A civil service system may, however, be adopted at any time after the district commences to operate, control, or use works or parts of works for the providing of any of the utility services specified in this division, and such system shall be adopted within six months thereafter.
The “district civil service” includes every employee of the district except all of the following:
Officers elected by the people.
Officers, assistant officers, and other persons and employees appointed by the board of directors.
Temporary construction employees.
Part-time employees.
The unfilled positions (not to exceed 15) requiring peculiar and exceptional qualifications, including those of a scientific, professional, or expert character or of special confidence, as may be exempted from “district civil service” upon the recommendation of the general manager approved by the board.
Limited-term employees appointed for a period not to exceed two years. Limited-term appointments may be extended for an additional period not to exceed two years upon approval of the general manager.
Employees occupying positions determined to be exempt from the district civil service pursuant to Section 11887.1.
ARTICLE 2. Appointments [12101. - 12104.]
All appointments under the civil service system shall be made for the good of the public service and solely on the basis of integrity, character, merit, fitness, and industry as established by appropriate competitive tests, without regard to partisan, political, social, or other considerations, and shall be made from lists of eligibles prepared by the general manager.
When no list of eligibles is available for a position in the class requisitioned by the department or division head, the general manager may make a noncivil service appointment thereto for a period of not exceeding six months and only until a regular appointment can be made, but no person shall be compensated under a noncivil service appointment, or appointments, for a period exceeding six months in any fiscal or calendar year, and no office or employment may be filled by a noncivil service appointment for more than six months in the aggregate in one fiscal or calendar year.
This section does not apply to a district which has owned or operated an electric distribution system for at least eight years and has a population of 250,000 or more.
When no list of eligibles is available for a position in the class requisitioned by the department or division head, the general manager of a district which has owned and operated an electric distribution system for at least eight years and has a population of 250,000 or more may make a noncivil service appointment thereto for a period of not exceeding 12 months and only until a regular appointment can be made.
The general manager may make appointments to higher positions exclusively promotional by tests from lower ranks.
Every appointee to a permanent position shall be on probation for six months, except that the general manager may establish a probationary period for up to 12 months for professional, scientific, technical, administrative, management, or executive positions, or for positions requiring certification by the state pursuant to Chapter 9 (commencing with Section 13625) of Division 7 of the Water Code. The general manager may terminate the appointment during the probationary period. If the appointment is not then terminated it shall be permanent, subject to this division and the rules and regulations adopted pursuant to this division.
ARTICLE 3. Blanketing-In [12131. - 12134.]
The incumbents of permanent positions who have held such positions for a period of at least six months continuously next preceding the time that a civil service system is first adopted shall be continued in their positions as if appointed thereto after examination and certification from a list of eligibles, and shall be governed thereafter by this division and the rules and regulations adopted pursuant thereto but shall not be subject to the six months’ probation period.
Whenever any district acquires existing facilities from a publicly or privately owned public utility, whether by proceedings in eminent domain or otherwise, any or all of the officers or employees of such public utility whose duties pertained to the facilities acquired may be appointed to positions in the district’s civil service system without examination and certification from a list of eligibles and shall be governed thereafter by this division and the rules and regulations adopted pursuant thereto but shall not be subject to the six months’ probation period.
If a civil service system is adopted for a district during the period of a leave of absence granted under Section 395.4 of the Military and Veterans Code or similar legislation, the officer or employee shall, on the termination of his leave of absence, be restored to a position in the district’s civil service system wherein he shall have the same or equivalent status as of the last working day before his leave of absence began. The officer or employee shall hold that position as if appointed thereto after examination and certification from a list of eligibles, and shall be governed thereafter by the rules and regulations of the civil service system, except that if such officer or employee had held a permanent position with the district for a period of six months continuously next preceding the beginning of his leave of absence, he shall not be subject to the six months’ probation period.
Whenever a district acquires existing facilities from a public utility, whether by proceedings in eminent domain or otherwise, any officer or employee of the public utility who left a permanent position with such utility pertaining principally to the facilities acquired in order to perform training and service under the Selective Training and Service Act of 1940 shall be entitled to be appointed to a position with permanent status in the district’s civil service under the same conditions as would have governed his right to reinstatement with the public utility under Section 8 (b) of that act if the district had not acquired those facilities.
No civil service status acquired by other officers or employees of the district shall prevent their removal by layoff or transfer from positions to which reinstatement is provided for in this section.
ARTICLE 4. Discipline [12161. - 12167.]
No person employed under civil service provisions of this division or of any rules and regulations adopted pursuant thereto in a permanent position shall be removed, discharged, or suspended except for cause.
Removal or discharge may be made for any of the following causes: incompetence, habitual intemperance, immoral conduct, insubordination, discourteous treatment of the public, dishonesty, or inattention to public service.
The department or division head may for disciplinary purposes suspend a subordinate for a period of not exceeding 15 days and suspension shall carry with it a loss of salary for the period of suspension.
Within five days after the mailing of written notice of removal, discharge, or suspension, any employee may file a written request with the general manager for an opportunity to be heard in his own defense or, at the employee’s option, may utilize a grievance procedure if the district and a recognized employee organization have agreed after meeting and conferring in good faith pursuant to Section 3505 of the Government Code that a grievance procedure may be used in disciplinary proceedings involving removals, discharges, and suspensions as an alternative to the procedure provided for in Sections 12165 and 12166.
When such request is made the general manager shall immediately appoint from officers or assistant officers of the district (other than elected officials), or heads of departments or divisions, a committee of three to hear and determine such charges and shall notify the person accused of the time and place when the charges will be heard by mailing a notice to his last known address.
The committee shall examine into the case and make such decision as it deems just and may among other things order the employee discharged, suspended, or reinstated. Its order or decision shall be final unless the employee within 10 days after the date of the order requests the general manager to review the order, in which event the general manager may require any additional evidence he deems material, and his order or decision, with or without such additional evidence, shall be final.
Nothing in the civil service provisions of this division deprives any person of his rights and remedies in a court of competent jurisdiction.
CHAPTER 5. Retirement System [12301. - 12392.]
ARTICLE 1. Establishment [12301. - 12307.]
The board may establish a retirement system for the officers, whether elective or appointive, or both, and employees of the district and provide for the payment of annuities, pensions, retirement allowances, disability payments, and death benefits, or any of them.
The district may maintain its own retirement fund or may provide for benefits to eligible officers and employees, or their beneficiaries, by means of group insurance or other insurance, or by such means as in the opinion of the board will satisfactorily provide an adequate and sure method of meeting the payments contemplated by the retirement system.
Before establishing any retirement system the board shall secure a report from a qualified actuary, which shall show the cost of the benefits provided by the system, and the prospective assets and liabilities of the system.
The board may adopt all ordinances and resolutions and perform all acts necessary or convenient to the initiation, maintenance, and administration of the retirement system.
A district may make all or part of its officers, whether elective or appointive, or both, and employees members of the Public Employees’ Retirement System by contract entered into between the district and the board of administration of the system under the Public Employees’ Retirement Law (Part 3 (commencing with Section 20000) of Division 5 of Title 2 of the Government Code); and the district may perform all acts necessary or convenient for that participation.
The board may classify and determine the officers, whether elective or appointive, or both, and employees who shall be included as members in the retirement system and may change the classification from time to time. Membership of all officers and employees so classified and included in the retirement system is compulsory.
Notwithstanding any other provision of law, a participant in a deferred compensation plan may also participate in the district’s retirement system, and, in ascertaining the amount of compensation of such participant, for purposes of computing the amount of his contributions or benefits under the district’s retirement system, any amount deducted from his wages pursuant to Section 12338 shall be included.
ARTICLE 2. Benefits and Contributions [12331. - 12338.]
The board may prescribe the terms and conditions upon which the officers and employees of the district or their beneficiaries shall be entitled to benefits and the amounts thereof.
The retirement allowance may be predicated in part upon service rendered the district by a member prior to the establishment of the retirement system, which service is known as “prior service.”
The board shall provide that both the district and the members shall contribute to the retirement system. Based on tables and assumptions adopted by the board, it shall fix the rates of contributions by officers and employees of the district who are members of the retirement system.
All members of the retirement system shall contribute in the manner and amount fixed by the board and such contributions may be collected by deducting the amounts thereof from the salary, wages, or compensation due such members.
Liabilities accruing under the retirement system because of benefits other than such as are the equivalent of contributions by the members, with accumulated interest, shall be met by contributions by the district. Prior service or other liabilities of the district may be met by annual appropriations instead of by one appropriation for the total of the liabilities; but until the present value of regular contributions for current service, together with assets then available, equals the present value of all allowances and benefits granted or to be granted under the system, the appropriation for any one year when added to any unused balance of any previous appropriations for such purpose shall not be less than the amount disbursed during that year on account of prior service or other liabilities of the district.
If any member withdraws from the retirement system prior to retirement the total amount contributed by him with such interest as may be credited thereto shall be returned to him; provided, however, that the board may prescribe the terms and conditions upon which a member, whose district service is terminated except by death or retirement, may elect to leave his contributions and interest thereon in the retirement fund, and the terms and conditions upon which a retirement allowance may be made to him after such termination based upon his contributions prior to such termination.
All money received by any person as an annuity, pension, retirement allowance, disability payment, or death benefit from the retirement system, and all contributions and interest thereon returned to any member of the retirement system, whether in the actual possession of such person or deposited, loaned, or invested by him, is unassignable, and is exempt from execution or any other process except to the extent permitted by Section 704.110 of the Code of Civil Procedure.
Notwithstanding the provisions of Section 12337, the retirement board may comply with and give effect to a revocable written authorization signed by a retired member or beneficiary of a retired member entitled to a retirement allowance or benefit under this chapter, authorizing the district to deduct appropriate amounts from the retirement allowance or benefit payable to any such retired member or beneficiary of a retired member for the purpose of paying premiums of any group medical or hospital service plan, or both, approved by the district, for the benefit of such retired member or his dependents, for the payment of personal income taxes to the Government of the United States or of the State of California, or for the purchase of shares in, or the payment of money to, the utility district credit union.
Nothing in this division shall prevent a district from establishing a deferred compensation plan for some or all of its officers and employees pursuant to Article 1.1 (commencing with Section 53212) of Chapter 2 of Part 1 of Division 2 of Title 5 of the Government Code.
ARTICLE 3. Retirement Board [12361. - 12368.]
The board shall create a retirement board of not more than five members, at least two members of which shall be the elected representatives of the employees, to administer the retirement system, and shall define its powers and duties and the tenure of the members.
All members of the retirement board shall serve without pay.
The retirement board shall determine the eligibility of officers, employees, and their dependents to participation in the system and shall be the sole authority and judge under such ordinances as may be adopted by the board as to the conditions under which persons may be admitted to and continue to receive benefits of any sort under the retirement system, and may modify allowances for service and disability. The determination of the retirement board shall be final and conclusive and shall not be modified or set aside except for fraud or abuse of discretion.
If the district maintains its own retirement fund, the retirement board shall have exclusive control of the administration, investment, and disbursement of the retirement fund. The retirement fund is a trust fund held for the exclusive purposes of providing benefits to members of the retirement system and their survivors and beneficiaries. Investment of the fund shall be subject to the care, skill, prudence, and diligence under the circumstances then prevailing that a prudent person acting in a like capacity and familiar with such matters would use in the conduct of an enterprise of a like character and with like aims.
In addition to such other investments that are authorized by this article, the retirement board may, in its discretion, invest the assets of the retirement fund in deeds of trust and mortgages. Investments made under this section shall not exceed, in the aggregate, an amount equal to 25 percent of the assets of the system.
Notwithstanding any other provision of this chapter, the retirement board, or the district’s treasurer with the approval of the retirement board, may enter into security loan agreements with broker-dealers and with California or national banks for the purpose of prudently supplementing the income normally received from investments.
“Security loan agreement” means a written contract whereby a legal owner, the lender, agrees to lend specific marketable corporate or government securities for a period not to exceed one year. The lender retains the right to collect from the borrower all dividends, interest, premiums, rights, and any other distributions to which the lender would otherwise have been entitled. The lender waives the right to vote the securities during the term of the loan. The lender may terminate the contract upon not more than five business days’ notice as agreed, and the borrower may terminate the contract upon not less than two business days’ notice as agreed. The borrower shall provide collateral to the lender in the form of cash or bonds or other interest-bearing notes and obligations of the United States or federal instrumentalities eligible for investment by a lending retirement fund.
The collateral shall be in an amount equal to at least 102 percent of the market value of the loaned securities as agreed. The lender shall monitor the market value of the loaned securities daily. The loan agreement shall provide for payment of additional collateral on a daily basis, or at the time the value of the loaned securities increases, to agreed-upon ratios. In no event shall the amount of the collateral be less than the market value of the loaned securities.
“Marketable securities” means securities that are freely traded on recognized exchanges or marketplaces.
The retirement board or district treasurer entering into security loan agreements shall do all of the following:
Maintain detailed records of all security loans.
Develop controls and reports to monitor the conduct of the transactions.
Publicize the net results of the security loan transaction separate from the results of other investment activities.
Notwithstanding Section 12364, the retirement board may contract with one or more qualified investment managers in connection with the investment program of the retirement board.
The retirement board may authorize a trust company or a trust department of any state or national bank authorized to conduct the business of a trust company in this state or the Federal Reserve Bank of San Francisco or any branch thereof within this state, to act as custodian of any securities invested in by the retirement board. Any such bank or trust company may be authorized to collect the income from such securities or the proceeds of the sale thereof for the retirement board, and deposit said income or funds in the account of the retirement system. The compensation of such bank or trust company for such custodial services shall be fixed by agreement and shall be paid in the same manner and from the same funds as are other costs of administration of the retirement system. Securities of the retirement fund held by the custodian bank or trust company may be registered in the nominee name of the custodian or of the retirement system. The custodian bank or trust company shall make such disposition of the securities as the retirement board shall authorize. All such securities are at all times subject to the order of the retirement board.
Funds held by a district pursuant to a written agreement between the district and the employees of the district to defer a portion of the compensation otherwise receivable by the district’s employees and pursuant to a plan for such deferral as adopted by the board, may be invested in the types of investments set forth in Section 53609 of the Government Code.
ARTICLE 4. Investigation and Penalties [12391. - 12392.]
At least once in each four-year period after the establishment of the retirement system the board shall cause to be made an actuarial valuation of the assets and liabilities of the retirement fund, and upon the basis of such investigation and valuation shall make such revision or change of the rates of contribution, the periods and conditions of service, and amounts of retirement allowances as may be necessary.
Except as herein provided, no member of the board or of the retirement board, nor any member of the retirement system or employee of the district, shall have any interest direct or indirect in the making of any investment or in the gains or profits accruing therefrom, and no such person, directly or indirectly, for himself or as an agent or partner of others, shall borrow any of its funds, nor shall any such person in any manner use the same except to make such current and necessary payments as are authorized by the retirement board, nor shall such a person become an endorser or surety as to, or in any manner an obligor for investments of the retirement fund.
CHAPTER 6. Powers and Functions of District [12701. - 13024.]
ARTICLE 1. Corporate Power [12701. - 12703.]
A district has perpetual succession and may adopt a seal and alter it at pleasure.
A district may sue and be sued, except as otherwise provided by law, in all actions and proceedings, in all courts and tribunals of competent jurisdiction.
Except as specified in subdivision (b), any judicial action or proceeding against a district that provides electric utility service, to attack, review, set aside, void, or annul an ordinance, resolution, or motion fixing or changing a rate or charge for an electric commodity or an electric service furnished by a district and adopted on or after July 1, 2000, shall be commenced within 120 days of the effective date of that ordinance, resolution, or motion.
The statute of limitations specified in subdivision (a) does not apply to any judicial action or proceeding filed pursuant to Chapter 13.7 (commencing with Section 54999) of Part 1 of Division 2 of Title 5 of the Government Code to protest or challenge a rate or charge or to seek the refund of a capital facilities fee if the notice and disclosure requirements of Section 54999.35 of the Government Code have not been followed.
A district may exercise the right of eminent domain to take any property necessary or convenient to the exercise of the powers granted in this division.
ARTICLE 2. Contracts [12721. - 12723.]
A district may make contracts and enter into stipulations of any nature whatsoever, either in connection with eminent domain proceedings or otherwise, including, without limiting the generality of the foregoing, contracts and stipulations to indemnify and save harmless, to employ labor, and to do all acts necessary and convenient for the full exercise of the powers granted in this division.
Neither the general manager nor any director of the district shall in any manner be interested, directly or indirectly, in any contract awarded or to be awarded by the board, or in the profits to be derived therefrom. Any violation of this provision is a misdemeanor, and conviction shall work a forfeiture of office. This section has no application to contracts awarded to corporations in which such officer owns less than 1 percent of the entire capital stock.
Whenever the board, by resolution passed by a majority of its members, determines that the public interest will be served, a district constructing or operating plants and appurtenant facilities for the generation of electrical power by nuclear energy may purchase or acquire insurance for such properties against physical loss or damage and the resultant loss of capacity for the generation of electrical power from insurance companies organized in the United States or foreign countries as either stock companies or assessment or nonassessment mutual companies. In the event such insurance is acquired from an assessment mutual company, a district shall have authority to share in the initial organization expenses of the company, to become a member of the company, and to assume liability for retrospective premium adjustments in accordance with the terms and conditions of the policy or contract of insurance issued by such company.
ARTICLE 3. Purchases [12751. - 12753.]
Except as specified in Section 12751.5, the purchase of all supplies and materials, when the expenditure required exceeds twenty-five thousand dollars ($25,000), or in a district that has a population of 250,000 or more, when the expenditure required exceeds fifty thousand dollars ($50,000), shall be by contract let to the lowest responsible bidder. Notice requesting bids shall be published pursuant to Section 6061 of the Government Code at least 10 days before bids are received. The district may reject any and all bids and readvertise in its discretion. The board may authorize the general manager to determine, in the discretion of the general manager, whether to reject all bids and whether, after the bids have been rejected, to readvertise.
The dollar limit identified in subdivision (a) shall annually be adjusted upward or downward to reflect the percentage change in the Implicit Price Deflator for State and Local Government Purchases of Goods and Services for the United States, as published by the U.S. Department of Commerce. The annual adjustments shall be rounded to the nearest one thousand dollars ($1,000).
Notwithstanding Section 12751, the board of a district which has owned and operated an electric distribution system for at least eight years and has a population of 250,000 or more may authorize the general manager to determine the lowest responsible bidder and to award a contract to that bidder.
Notwithstanding Section 12751, the board of a district which has owned and operated water distribution or sewage disposal systems for at least eight years and has a population of 250,000 or more may authorize the general manager to act for the board in determining the lowest responsible bidder and awarding a contract to that bidder where the expenditure required by the bid price is less than one hundred thousand dollars ($100,000). When acting pursuant to this section, the general manager shall, in each instance, promptly notify the board of the action taken.
The purpose of this section is to provide affected districts with an alternative acquisition process that will result in reduced costs to ratepayers. Notwithstanding Section 12751, when the expenditure for the purchase of supplies and materials exceeds fifty thousand dollars ($50,000) and the district determines that ratepayers reasonably can expect a net benefit in the cost of district services, the district may provide for the purchase of the supplies and materials by contract let in accordance with best value at the lowest cost acquisition policies adopted by the board pursuant to this section.
The best value at the lowest cost acquisition policies adopted pursuant to subdivision (a) shall include the following:
Price and service level proposals that reduce the district’s overall operating costs.
Supplies and materials standards that support the district’s strategic supplies and materials acquisition and management program direction.
A procedure for protest and resolution.
For purposes of this section, “best value at the lowest cost acquisition” means a competitive procurement process whereby the award of a contract for supplies and materials may take into consideration any of the following factors:
The quality, effectiveness, and innovation of supplies, materials, and services.
The reliability of delivery or installation schedules.
The terms and conditions of product warranties and vendor guarantees.
The financial stability of the vendor.
The vendor’s quality assurance program.
The vendor’s experience with the provision of supplies, materials, and services.
The consistency of the vendor’s proposed supplies, materials, and services with the district’s overall supplies and materials procurement program.
The economic benefits to the general community related to job creation or retention.
If a district that did not purchase supplies and materials by contract let pursuant to this section before January 1, 2006, elects to purchase supplies and materials by contract, let in accordance with best value acquisition policies adopted by the board pursuant to this section, the district shall submit a report to the Legislative Analyst on or before January 1, 2011. The district shall include in the report a summary of the costs and benefits of best value acquisition compared to traditional low bid procurement practices. The report shall also include statistics showing the number of contracts awarded to small businesses, minority-owned businesses, and new businesses and the number of years each contract awardee had been in business. The report shall also include an analysis of the effects of best value procurement practices on these businesses, the nature of any disputes arising from the use of best value procurement practices, and the status of those disputes. On or before April 1, 2011, the Legislative Analyst shall report to the Legislature on the use of “best value at lowest cost acquisition” procurement practices used by municipal utility districts, and recommend whether to modify this section and extend the authority of additional districts to elect to purchase supplies and materials by contract let in accordance with best value acquisition policies, beyond January 1, 2012.
The district shall ensure that all businesses have a fair and equitable opportunity to compete for, and participate in, district contracts and shall also ensure that discrimination in the award and performance of contracts does not occur on the basis of marital status, ancestry, medical condition, any characteristic listed or defined in Section 11135 of the Government Code, or retaliation for having filed a discrimination complaint in the performance of district contractual obligations.
A district that did not purchase supplies and materials by contract let pursuant to this section before January 1, 2006, shall not purchase supplies and materials by contract let pursuant to this section after January 1, 2012.
If after the bids have been rejected, the board determines and declares by a four-fifths vote of all the members of a five-ward district, or by a five-sevenths vote of all the members of a seven-ward district, that in its opinion the materials and supplies may be purchased at a lower price in the open market, the board may proceed, or may authorize the general manager to proceed, to purchase the supplies and materials in the open market without further observance of the provisions requiring contracts, bids, or notice.
In case of any great emergency, the board may, by resolution passed by a four-fifths vote of all the members of a five-ward district, or by a five-sevenths vote of all the members of a seven-ward district, declare and determine that such emergency exists, and thereupon proceed to expend sums or enter into contracts involving the expenditure of any sums needed in such emergency without observance of the provisions requiring contracts, bids, or notice.
ARTICLE 4. Property [12771. - 12773.]
A district may take by grant, purchase, gift, devise, or lease, or condemn in proceedings under eminent domain, or otherwise acquire, and hold and enjoy, real and personal property of every kind within or without the district necessary to the full or convenient exercise of its powers. The board may lease, mortgage, sell, or otherwise dispose of any real or personal property within or without the district when in its judgment it is for the best interests of the district so to do. The provisions of this section apply to all sales or mortgages heretofore or hereafter made.
A district may destroy a record pursuant to Chapter 7 (commencing with Section 60200) of Division 1 of Title 6 of the Government Code.
For purposes of this section, “security” has the same meaning as defined in Section 25019 of the Corporations Code.
The Sacramento Municipal Utility District may operate a program under which the board of directors of the district may hold nonstock security in a corporation or other private entity if acquired as part of a procurement of goods or services from that entity, or as full or partial consideration for providing that entity services or access to district facilities, if separate funding is not expended solely for the nonstock security. The board of directors of the district may sell or otherwise dispose of the nonstock security when, in its judgment, it is in the best interests of the district to do so.
Before exercising the authority described in subdivision (b), the district’s board of directors shall do all of the following:
Make all of the following findings:
The acquisition furthers the purposes of the district, pursuant to this division.
The acquisition is in the interest of the district’s ratepayers and the public.
Establish a policy governing acquisitions that includes, but is not limited to, all of the following:
Procedures for preventing conflicts of interest and violations of Article 4 (commencing with Section 1090) of Chapter 1 of Division 4 of Title 1 of the Government Code.
Procedures for determining how much of an acquisition to accept in lieu of, or in addition to, other forms of remuneration, in order to ensure the district secures a reasonable return on any intellectual property or other resources it provides the private entity.
Procedures governing the approval process for accepting any acquisitions.
Procedures that ensure acquisition of a nonstock security does not unduly influence the amount paid for the associated goods and services.
Post the policy described in paragraph (2) on the district’s internet website.
Adopt a resolution at a regular meeting of the board stating the intent of the board to exercise the authority described in subdivision (b).
The authority described in subdivision (b) shall be limited to a total of six acquisitions. Any profit or other gain earned by an acquisition shall be used to benefit the district’s ratepayers.
The value, at the time of acquisition, of any single nonstock security acquired pursuant to the authority described in subdivision (b) shall be limited to no more than 3 percent of the district’s annual revenue in the fiscal year the district makes the acquisition.
This section shall remain in effect only until January 1, 2035, and as of that date is repealed.
ARTICLE 5. Utility Works and Service [12801. - 12827.]
A district may acquire, construct, own, operate, control, or use, within or without, or partly within or partly without, the district, works or parts of works for supplying the inhabitants of the district and public agencies therein, or some of them, with light, water, power, heat, transportation, telephone service, or other means of communication, or means for the collection, treatment, or disposition of garbage, sewage, or refuse matter, and may do all things necessary or convenient to the full exercise of the powers herein granted. The district may also purchase any of such commodities or services from any other utility district, public agency, person, or private company, and distribute them.
A district that provides broadband Internet access services shall comply with the requirements of Article 12 (commencing with Section 53167) of Chapter 1 of Part 1 of Division 2 of Title 5 of the Government Code.
A district may accept, without limitation by any other provisions of this division requiring approval of indebtedness, contributions of money, rights of way, labor, materials, and any other property for the construction, maintenance, and operation of any enterprise in which the district is authorized to engage, and may enter into any contracts and cooperate with and accept cooperation from the State, or any department, instrumentality, or agency thereof, or any public agency of the State in the construction, maintenance, and operation of, and in financing the construction, maintenance, and operation of, any such enterprise.
Except as provided in this division with reference to sewage disposal, a district shall not interfere with or exercise any control over any existing utility owned and operated by any public agency in the district, unless by consent of the legislative body of the public agency and upon such terms as are mutually agreed upon between the board and the legislative body of the public agency.
Whenever there is a surplus of water, light, heat, or power above that which is required by inhabitants or public agencies within a district, the district may sell or otherwise dispose of the surplus outside of the district to persons, firms, and public or private corporations, or public agencies outside the district.
Whenever any of the facilities, works, or utilities of the district, or part thereof, is not used or employed to its fullest capacity for the benefit or requirements of the district or its inhabitants, the district may enter into an agreement with public agencies or any person, firm, or corporation, upon such terms and conditions as are satisfactory to the board, for renting, leasing, or otherwise using the available portion or parts of the facilities, works, or utilities, and in connection with any such agreement, renting, or leasing the district may undertake or perform any services incidental thereto.
The district and any public agencies included therein may at any time enter into appropriate contracts for the use by any such public agencies of commodities or service furnished by any of the works acquired, owned, or operated, or authorized to be acquired, constructed, or completed by the district, or of any of the facilities of the district.
A district may sell or otherwise dispose of any water, sewage effluent, fertilizer, or other by-product resulting from the operation of a sewage disposal system, and may construct, maintain, and operate such pipelines and other works as are necessary for that purpose.
A district may construct works across or along any street or public highway, or over any of the lands which are the property of the State, and it shall have the same rights and privileges appertaining thereto as are granted to municipalities within the State. The district shall restore any such street or highway to its former state as near as may be, and in compliance with local ordinances, and shall not use it in a manner to unnecessarily impair its usefulness. A district may also construct its works across any stream or watercourse.
Notwithstanding Sections 53091 and 65402 of the Government Code, Section 12808 of the Public Utilities Code and Section 1469 of the Streets and Highways Code or any other provision of law, no district may locate or construct, any lines, for the transmission or distribution of electrical energy, including poles and other accessory structures, unless such facilities are approved pursuant to this section.
The district shall hold a public hearing on proposed facilities which are subject to this section.
Mailed notice of the public hearing shall be provided at least 10 days prior to the hearing, to the owners of all property within 300 feet of the route along which such facilities are proposed to be located.
If mailed notice as required in paragraph (1) above would result in notice to more than 250 persons, as an alternative to such mailed notice, notice may be given by placing a display advertisement of at least one-fourth page in a newspaper of general circulation within the area affected by the proposed facility.
After holding a hearing as provided in subdivision (b), the district shall submit any proposed facilities to the legislative body of each local agency in which such facilities are to be located. The legislative bodies shall conduct a public hearing, receive evidence, and, within 60 days, adopt a resolution approving, approving an alternative, or disapproving, the proposed facilities.
Any resolution adopted pursuant to this subdivision shall contain findings concerning:
Such other factors related to the public health, safety and welfare as are included within the ordinance adopted by the local agency pursuant to subdivision (e) of this section.
Failure of a legislative body to render a decision within 60 days shall be deemed to constitute an approval of the proposed facilities.
Notwithstanding the provisions of subdivision (c), the governing board of the district by vote of four-fifths of its members may render a local agency’s decision inapplicable to proposed facilities if the district, at a publicly noticed hearing, determines by resolution that there is no feasible alternative to the district’s proposal. Prior to adopting the resolution, the district shall read into the record the local agency’s resolution. The board shall, within 10 days, notify the city or county concerned of such action. If the governing board has taken such action the local agency may commence an action in the superior court of the county whose action is involved or in which is situated the city whose action is involved, seeking a review of such action of the governing board of the district to determine whether it was supported by substantial evidence. The evidence before the court shall include, but not be limited to, the record of the proceedings before the city, county, and local agency. The city or county shall cause a copy of the complaint to be served on the board. If the court determines that such action was not supported by substantial evidence, it shall declare it to be of no force and effect, and the local agency’s decision shall be applicable to the proposed facilities.
This section shall not apply to:
Any facilities proposed to be located within any local agency which has not adopted an ordinance setting forth criteria to govern its decision pursuant to subdivision (c) of this section.
Any electrical distribution lines of less than 100,000 volts.
As used in this section, the term “feasible” means capable of being accomplished in a successful manner within a reasonable period of time, taking into account economic, environmental, social, and technological factors.
As used in this section, “local agency” means a city, a city and county, or a county. Within cities this section shall not apply to counties.
The rates and charges for commodities or service furnished by a district shall be fixed by the board. As far as possible utilities shall be self-supporting but the board is not required to fix a rate which in its opinion is unreasonably high, nor to cover by rates large expenditures and the interest thereon required for future needs and developments.
The board may provide that rates, tolls, and charges for any sewage disposal enterprise or service may be collected with the rates, tolls, and charges for any water or other utility service rendered by the district, and that all rates may be billed upon the same bill and collected as one item. If charges for water and sewage disposal service are billed upon the same bill the district may discontinue water service in the event of failure to pay the whole or any part of the bill.
The board may provide for the collection of fees, tolls, rates, rentals, or other charges in any lawful manner and may provide for collection by action at law, and all remedies for the collection and enforcement thereof are cumulative and may be pursued alternatively or consecutively as the board determines. In addition to the amount of the fees, tolls, rates, rentals, or other charges, the board may provide for a penalty of not more than 10 percent or interest at the prevailing prime interest rate, but not to exceed 112 percent per month, or both, in the event of nonpayment within the time and in the manner prescribed by the board, and may provide for collection of the penalty and interest.
Except when prohibited by Section 12822.6, a district may, by resolution or ordinance, require the owner of record of real property within the district to pay the fees, tolls, rates, rentals, or other charges for services rendered to a lessee, tenant, or subtenant, and those fees, tolls, rates, rentals, and other charges that have become delinquent, together with interest and penalties thereon, are a lien on the property when a certificate is filed in the office of the county recorder pursuant to subdivision (b) and the lien has the force, effect, and priority of a judgment lien. No lien may be created under this section on any publicly owned property.
A lien under this section attaches when the district files for recordation in the office of the county recorder a certificate specifying the amount of the delinquent fees, tolls, rates, rentals, or other charges together with interest and penalties thereon; the name of the owner of record of the property to which services were rendered by the district; and the legal description of the property. Within 30 days of receipt of payment of all amounts due, including recordation fees paid by the district, the district shall file for recordation a release of the lien.
A district may, by resolution or ordinance, provide that any delinquent fees, tolls, rates, rentals, or other charges, together with interest and penalties thereon, including any delinquent fees, tolls, rates, rentals, or other charges for services rendered to a lessee, tenant, or subtenant, may be collected on the tax roll in the same manner as property taxes. Before any entity may collect any delinquent fees, tolls, rates, rentals, or other charges, together with interest and penalties thereon, including any delinquent fees, tolls, rates, rentals, or other charges for services rendered to a lessee, tenant, or subtenant on the tax roll, the district shall prepare a report, provide notice, conduct a public hearing, and file a certificate in the office of the county recorder, as follows:
The general manager shall prepare and file with the district board of directors a report that describes each affected parcel of real property and the amount of the delinquent fees, tolls, rates, rentals, or other charges, together with interest and penalties thereon, including any delinquent fees, tolls, rates, rentals, or other charges for services rendered to a lessee, tenant, or subtenant for each affected parcel for the year. The general manager shall give notice of the filing of the report and of the time, date, and place for a public hearing by publishing the notice pursuant to Section 6066 of the Government Code in a newspaper of general circulation, and by mailing the notice to the owner of each affected parcel at least 14 days prior to the date of the hearing.
At the public hearing, the board of directors shall hear and consider any objections or protests to the report. At the conclusion of the public hearing, the board of directors may adopt or revise the delinquent fees, tolls, rates, rentals, or other charges, together with interest and penalties thereon, including any delinquent fees, tolls, rates, rentals, or other charges for services rendered to a lessee, tenant, or subtenant. The board of directors shall make its determination on each affected parcel and its determinations shall be final.
On or before August 10 of each year following these determinations, the general manager shall file with the county auditor a copy of the final report adopted by the board of directors. The county auditor shall enter the amount of the delinquent fees, tolls, rates, rentals, or other charges, together with interest and penalties thereon, including any delinquent fees, tolls, rates, rentals, or other charges for services rendered to a lessee, tenant, or subtenant, against each of the affected parcels of real property as they appear on the current assessment roll. The county tax collector shall include the amount of the delinquent fees, tolls, rates, rentals, or charges, together with interest and penalties thereon, including any delinquent fees, tolls, rates, rentals, or other charges for services rendered to a lessee, tenant, or subtenant, on the tax bills for each affected parcel of real property and collect the delinquent fees, tolls, rates, rentals, or charges, together with interest and penalties thereon, including any delinquent fees, tolls, rates, rentals, or other charges for services rendered to a lessee, tenant, or subtenant, in the same manner as property taxes.
The district may recover any delinquent fees, tolls, rates, rentals, or other charges, together with interest and penalties thereon, including any delinquent fees, tolls, rates, rentals, or other charges for services rendered to a lessee, tenant, or subtenant, by recording in the office of the county recorder of the county in which the affected parcel is located, a certificate declaring the amount of the delinquent fees, tolls, rates, rentals, or charges, together with interest and penalties thereon, including any delinquent fees, tolls, rates, rentals, or other charges for services rendered to a lessee, tenant, or subtenant, due, and the name and last known address of the person liable therefor. From the time of recordation of the certificate, the amount of the delinquent fees, tolls, rates, rentals, or charges, together with interest and penalties thereon, including any delinquent fees, tolls, rates, rentals, or other charges for services rendered to a lessee, tenant, or subtenant, constitutes a lien against the affected real property of the delinquent property owner in that county. This lien shall have the force, effect, and priority of a judgment lien. Within 30 days of receipt of payment of all amounts due, including recordation fees paid by the district, the district shall file for recordation a release of the lien.
The district shall not recover on the tax roll any delinquent fees, tolls, rates, rentals, or other charges for services for commercial use to a commercial tenant under an account established by the commercial tenant, from any subsequent tenant or the property owner, due to nonpayment of charges by a previous commercial tenant. For this purpose, the term “subsequent commercial tenant” shall not include an entity or adult person that was located at the same address during the period the charges or penalties accrued. This paragraph does not apply to master-metered accounts.
A district shall reimburse the county for the reasonable expenses incurred by the county pursuant to this section.
The remedies in this section are cumulative and in addition to any other remedy provided by law. The district may pursue remedies alternatively or consecutively.
This section does not apply to delinquent fees or charges for the furnishing of electrical service.
Notwithstanding any other provision of law, a district may establish a temporary relief program for assistance to needy customers of the district who are financially unable to pay in full bills for services furnished by the district within the normal period for payment thereof, and may expend funds, enter into contracts, and cooperate with and accept cooperation from any state or local public agency or private nonprofit organization in the implementation of such a program.
As used in this section, “needy” means either of the following:
A household with an income which does not exceed the greater of either (A) an amount equal to 150 percent of the poverty level of this state, as determined pursuant to paragraph (2) of subdivision (e) of Section 16367.5 of the Government Code, or (B) an amount equal to 60 percent of the state median income.
A household with an income which meets guidelines for existing public assistance programs funded by the federal government.
The board may apportion all or a portion of the expenses of operation and maintenance of any sewage disposal facilities constructed by the district, and the interest on any bonds issued therefor, among the public agencies whose sewers are connected with district facilities. The board shall establish rules for determining the apportionment, which among other things shall be based on the quantity, quality, or characteristics of the sewage delivered by each public agency.
Notwithstanding any of the provisions of this article, the board may, in its discretion, finance any sewage disposal or solid waste resource recovery enterprise, the interest on and retirement of any bonded indebtedness therefor, and provide for the maintenance and operation thereof entirely by the levy and collection of taxes upon the property within the special district for which the enterprise is constructed or operated, or by rates and charges imposed upon the users of the facilities of the enterprise, or by both taxes, rates, and charges, apportionment of expenses among public agencies served, or any combination of the foregoing.
A district may add fluorine or fluorine compounds to the water supply of the district only if the voters of the district have approved the addition of the fluorine and fluorine compounds to the water supply. If a majority of the voters of a district voting upon the proposition at an election called and held as prescribed in Section 12815 have voted in favor of the addition of fluorine and fluorine compounds to the water supply of the district, the district shall, subject to Article 1 (commencing with Section 116275), of Chapter 4 of Part 12 of Division 104 of, and Sections 116325, 116340, 116345, and 116500 of, the Health and Safety Code, add to water intended for consumption or use by the public, including domestic, industrial, and other uses, fluorine and fluorine compounds.
The board may call a special election at any time for the purpose of submitting to the voters of the district the proposition as to whether or not the voters approve the addition of fluorine and fluorine compounds to the public water supply of the district. The ordinance calling an election shall fix the date on which the election shall be held, the wording of the proposition and the manner of holding the election and of voting for or against the proposition. The election shall be consolidated, in the manner provided in Section 13209, with a statewide primary or general election. The ordinance shall be published. Another election in the district on the same or substantially the same proposition shall not be called by the board, pursuant to this section or Section 12815.1, within four years after such election.
The board shall adopt an ordinance, in accordance with Section 12815, calling an election for the purpose of submitting to the voters of the district the proposition as to whether or not the voters approve the addition of fluorine and fluorine compounds to the public water supply of the district, when a petition for the election has been filed with, and certified as sufficient by, the secretary of the district. The election shall be conducted in accordance with Section 12815. Petitions meeting the requirements of Sections 12814 to 12816, inclusive, shall be in lieu of the initiative procedure provided by Article 1 (commencing with Section 9300) of Chapter 4 of Division 9 of the Elections Code.
Petitions which meet the requirements of this article shall be certified as sufficient.
Before circulating the petition, its proponents shall publish a notice of intention to do so. The notice shall be accompanied by a printed statement, not exceeding 500 words in length, stating the reasons for the petition. The notice and statement shall be published at least once in a newspaper of general circulation which is published in the district.
Within 10 days after notice is published, the proponents shall file a copy of such notice and the accompanying statement, and an affidavit as to the publishing thereof, with the secretary. The petition may be circulated among the voters of the district twenty-one days after notice is published. The petition shall bear a copy of the printed notice of intention and its accompanying statement. Signatures shall be secured and the petition shall be presented to the secretary for filing within 180 days from the date of the first publication of the notice of intention.
The petition shall declare that the public interest or necessity demands that a special election be called by the board of directors for the purpose of submitting to the voters of the district the proposition as to whether or not the voters approve the addition of fluorine and fluorine compounds to the public water supply of the district. The petition may be presented in sections, but each section shall contain a declaration of public interest or necessity, and shall have attached thereto an affidavit substantially in the same form as set forth in Section 9022 of the Elections Code. In addition, each section shall be designed as set forth in Section 9020 of the Elections Code.
Any registered voter who is a resident of the district may circulate the petition anywhere within the district. Each section of the petition shall bear the name of a county, and only registered voters of that county shall sign such section.
The petition shall be filed by the proponents, or by any person or persons authorized, in writing, by the proponents. All sections of the petition shall be filed at one time. When the petition is presented for filing, the secretary shall determine the total number of signatures affixed to the petition. If, from this examination, the secretary determines that the petition has been signed by at least 5 percent of the registered voters in the district, then the secretary shall accept the petition for filing. The petition shall be deemed as filed on that date. Any sections of the petition not so filed shall be void for all purposes.
If the petition contains more than 500 signatures, the secretary shall, within 30 days from the date such petition is filed, verify such signatures by means of a random sampling. The random sample of signatures shall be drawn in such a manner that every signature filed with the secretary is given an equal opportunity to be included in the sample. Such a random sampling shall include an examination of at least 500 or 5 percent of the signatures, whichever is greater.
If the projection made from the random sampling as to signature validity shows the number of valid signatures as between 90 and 110 percent of the signatures needed to declare the petition sufficient, the secretary shall examine and verify each signature filed.
In determining valid signatures from voter registration records, the secretary may use the duplicate file of affidavits or may check the signatures against facsimiles of voter signatures, provided that the method of preparing and displaying the facsimiles complies with law.
The secretary shall attach to the petition, a certificate showing the result of the signature examination, and shall notify the proponents of either the sufficiency or insufficiency of the petition.
If the petition is found insufficient, no action shall be taken on it. However, the failure to secure sufficient signatures shall not preclude the later filing of a new petition to the same effect.
If the petition is found to be sufficient, the secretary shall certify the results of the signature examination to the board at its next regular meeting.
At least 90 days prior to the election provided for in Sections 12815 and 12815.1, notice of the election shall be published within the district. Any voter or group of voters may prepare and file with the county elections official of the county containing the largest number of voters within the district an argument for or against the proposition to be submitted. The argument shall not be greater than 300 words in length. If more than one argument for or more than one argument against the proposition is filed within the time permitted the county elections official shall select one of the arguments for printing. No more than three signatures shall appear with any argument. The county elections official of each county in the district shall mail, or cause to be mailed, to each registered voter in that county in the district one copy of the argument for and one copy of the argument against the proposition. The arguments shall be mailed with the sample ballot.
Based on the time reasonably necessary to prepare and print the arguments and sample ballots for the particular election, the county elections official shall fix and determine a reasonable date prior to the election after which no arguments for or against the proposition may be submitted for printing and distribution to the voters as provided in this section. Notice of the date fixed shall be published by the county elections official pursuant to Section 6061 of the Government Code. Arguments may be changed up to and including the date fixed by the county elections official.
A district may, through contract or otherwise, construct, maintain, improve and operate public recreational facilities appurtenant to any water reservoir owned or operated by the district, and the district may expend funds on such public recreational facilities.
No publicly owned utility shall commence the distribution or sale of water for municipal, domestic, industrial or similar purposes for, on, or to, any land within a district already engaged in similar distribution or sale of water and which land is already subject to the lien of a general obligation bonded indebtedness of the district for these purposes. However, a publicly owned utility may commence to provide the service to the land, otherwise prohibited, upon either of the following conditions:
If the board of directors of the district shall by resolution permit the service.
In any portion of the district proposed to be served by the publicly owned utility in which the total number of registered voters residing therein exceeds 200, and in which at least two-thirds of the voters shall have voted at a special district election to permit the service. The election shall be called and held as an initiative measure pursuant to Article 1 (commencing with Section 9300) of Chapter 4 of Division 9 of the Elections Code.
As used in this section, “district” shall mean only a municipal utility district.
Every district furnishing light, heat, or power shall expend no funds for advertising when the advertising encourages increased consumption of the services or commodities.
Nothing in this section shall prohibit a district furnishing light, heat, or power from expending funds for advertising which encourages the more efficient operation of the facilities, works, or utilities of the district, or for advertising which encourages the more efficient use of light, heat, or power, the conservation of energy or natural resources, or presents accurate information on the economical purchase, maintenance, or use of any appliance or device using light, heat, or power.
Nothing in this section shall prohibit a district furnishing light, heat, or power from expending funds for advertising for the purposes of economic development that benefits ratepayers, retaining customers, marketing competitive services and commodities, or promoting electrotechnologies that enhance productivity or provide environmental benefits, within or without the district.
Whenever a business transaction of a municipal utility district furnishing electricity, gas, water service where the utility has 10,000 or more service connections, or telephone service is such that a personal appearance by a person is required by the district and the person is unable to appear at the district’s place of business during the district’s usual business hours, then the district shall provide a reasonable and convenient alternative to the person such as an appointment outside the district’s usual business hours or allowing the person to conduct the transaction by telephone, mail, or both.
A district may employ a suitable security force. The employees of the district that are designated by the general manager as security officers shall have the authority and powers conferred by subdivision (a) of Section 830.34 of the Penal Code upon peace officers. The district shall adhere to the standards for recruitment and training of peace officers established by the Commission on Peace Officer Standards and Training pursuant to Title 4 (commencing with Section 13500) of Part 4 of the Penal Code.
Every security officer employed by a district shall conform to the standards for peace officers of the Commission on Peace Officer Standards and Training. Any officer who fails to conform to these standards shall not continue to have the powers of a security officer.
Every violation declared an infraction pursuant to subdivision (a) shall be punishable by (1) a fine not exceeding fifty dollars ($50) for a first violation; (2) a fine not exceeding one hundred dollars ($100) for a second violation of the same ordinance within one year; and (3) a fine not exceeding two hundred fifty dollars ($250) for each additional violation of the same ordinance within one year.
Whenever residential light, heat, or power is furnished through a submeter system by a master-meter customer for sale to users who are tenants of a mobilehome park, apartment building, or similar residential complex, the master-meter customer is responsible for maintenance and repair of its submeter facilities beyond the master meter, and nothing in this section requires a district to make repairs to or perform maintenance on the submeter system.
Every master-meter customer shall provide an itemized billing of charges for light, heat, and power to each individual user generally in accordance with the form and content of bills of the district to its residential customers, including, but not limited to, the opening and closing readings for the meter, and the identification of all rates and quantities under the applicable rate structure. The master-meter customer shall charge each user of the service at a rate which does not exceed the rate which would be applicable if the user were receiving residential light, heat, or power directly from the district. The master-meter customer shall also post, in a conspicuous place, the applicable prevailing residential rate schedule, as published by the district.
The district shall notify each master-meter customer of its responsibilities to its users under this section.
This section applies if there is a landlord-tenant relationship between the residential occupants and the owner, manager, or operator of the dwelling.
If a district furnishes individually metered residential light, heat, water, or power to residential occupants in a detached single-family dwelling, multiunit residential structure, mobilehome park, or permanent residential structure in a labor camp, as defined in Section 17008 of the Health and Safety Code, and the owner, manager, or operator of the dwelling, structure, or park is the customer of record of the service, the district shall make every good faith effort to inform the residential occupants, by means of written notice, when the account is in arrears, that service will be terminated in 10 days. The written notice shall further inform the residential occupants that they have the right to become customers of the district without being required to pay the amount due on the delinquent account. The notice shall be in English and in the languages listed in Section 1632 of the Civil Code.
The district is not required to make service available to the residential occupants unless each residential occupant agrees to the terms and conditions of service, and meets the requirements of the district’s rules. However, if one or more of the residential occupants are willing and able to assume responsibility for the subsequent charges to the account to the satisfaction of the district, or if there is a physical means, legally available to the district, of selectively terminating service to those residential occupants who have not met the requirements of the district’s rules, the district shall make service available to the residential occupants who have met those requirements.
If prior service for a period of time is a condition for establishing credit with the district, residence and proof of prompt payment of rent or other credit obligation acceptable to the district for that period of time is a satisfactory equivalent.
Any residential occupant who becomes a customer of the district pursuant to this section whose periodic payments, such as rental payments, include charges for residential light, heat, water, or power, where these charges are not separately stated, may deduct from the periodic payment each payment period all reasonable charges paid to the district for those services during the preceding payment period.
If a district furnishes residential light, heat, water, or power to residential occupants through a master meter in a multiunit residential structure, mobilehome park, or permanent residential structures in a labor camp, as defined in Section 17008 of the Health and Safety Code, and the owner, manager, or operator of the structure or park is listed by the district as the customer of record of the service, the district shall make every good faith effort to inform the residential occupants, by means of a written notice posted on the door of each residential unit at least 15 days prior to termination, when the account is in arrears, that service will be terminated on a date specified in the notice. If it is not reasonable or practicable to post the notice on the door of each residential unit, the district shall post two copies of the notice in each accessible common area and at each point of access to the structure or structures. The notice shall further inform the residential occupants that they have the right to become customers, to whom the service will then be billed, of the district without being required to pay the amount due on the delinquent account. The notice also shall specify, in plain language, what the residential occupants are required to do in order to prevent the termination or reestablish service; the estimated monthly cost of service; the title, address, and telephone number of a representative of the district who can assist the residential occupants in continuing service; and the address and telephone number of a legal services project, as defined in Section 6213 of the Business and Professions Code, which has been recommended by the local county bar association. The notice shall be in English and in the languages listed in Section 1632 of the Civil Code.
The district is not required to make service available to the residential occupants unless each residential occupant or a representative of the residential occupants agrees to the terms and conditions of service, and meets the requirement of law and the district’s rules. However, if one or more of the residential occupants or the representative of the residential occupants are willing and able to assume responsibility for subsequent charges to the account to the satisfaction of the district, or if there is a physical means, legally available to the district, of selectively terminating service to those residential occupants who have not met the requirements of the district’s rules or for whom the representative of the residential occupants is not responsible, the district shall make service available to the residential occupants who have met those requirements or on whose behalf those requirements have been met.
If prior service for a period of time, or other demonstration of credit worthiness is a condition for establishing credit with the district, residence and proof of prompt payment of rent or other credit obligation during that period of time acceptable to the district is a satisfactory equivalent.
Any residential occupant who becomes a customer of the district pursuant to this section whose periodic payments, such as rental payments, include charges for residential light, heat, water, or power, where these charges are not separately stated, may deduct from the periodic payment each payment period all reasonable charges paid to the district for those services during the preceding payment period.
If a district furnishes residential service subject to subdivision (a), the district may not terminate that service in any of the following situations:
During the pendency of an investigation by the district of a customer dispute or complaint.
If the customer has been granted an extension of the period for payment of a bill.
For an indebtedness owed by the customer to any other public agency or when the obligation represented by the delinquent account or other indebtedness was incurred with any public agency other than the district.
If a delinquent account relates to another property owned, managed, or operated by the customer.
If a public health or building officer certifies that termination would result in a significant threat to the health or safety of the residential occupants or the public.
Notwithstanding any other provision of law, and in addition to any other remedy provided by law, if the owner, operator, or manager, by any act or omission, directs, permits, or fails to prevent a termination of service while any residential unit is occupied, the residential occupant or the representative of the residential occupants may commence an action for the recovery of all of the following:
Reasonable costs and expenses incurred by the residential occupant or the representative of the residential occupants related to restoration of service.
Actual damages related to the termination of service.
Reasonable attorney’s fees of the residential occupants, the representative of the residential occupants, or each of them, incurred in the enforcement of this section, including, but not limited to, enforcement of a lien.
Notwithstanding any other provision of law, and in addition to any other remedy provided by law, if the owner, manager, or operator, by any act or omission, directs, permits, or fails to prevent a termination of service while any residential unit receiving that service is occupied, the corporation may commence an action for the recovery of all of the following:
Delinquent charges accruing prior to the expiration of the notice prescribed by subdivision (a).
Reasonable costs incurred by the corporation related to the restoration of service.
Reasonable attorney’s fees of the corporation incurred in the enforcement of this section or in the collection of delinquent charges, including, but not limited to, enforcement of a lien.
If the court finds that the owner, manager, or operator has paid the amount in arrears prior to termination, the court shall allow no recovery of any charges, costs, damages, expenses, or fees under this subdivision from the owner, manager, or operator.
An abstract of any money judgment entered pursuant to subdivision (f) or (g) shall be recorded pursuant to Section 697.310 of the Code of Civil Procedure.
No termination of service subject to this section may be effected without compliance with this section, and any service wrongfully terminated shall be restored without charge to the residential occupants or customer for the restoration of the service. In the event of a wrongful termination by the district, the district shall, in addition, be liable to the residential occupants or customer for actual damages resulting from the termination and for the costs of enforcement of this section, including, but not limited to, reasonable attorney’s fees, if the residential occupants or the representative of the residential occupants make a good faith effort to have the service continued without interruption.
The district shall adopt rules and regulations necessary to implement this section and shall liberally construe this section to accomplish its purpose of ensuring that service to the residential occupants is not terminated due to nonpayment by the customer unless the district has made every reasonable effort to continue service to the residential occupants. The rules and regulations shall include, but are not limited to, guidelines for assistance to actual users in the enforcement of this section and requirements for the notice prescribed by subdivision (a), including, but not limited to, clear wording, large and boldface type, and comprehensive instructions to ensure full notice to the actual user.
Nothing in this section broadens or restricts any authority of a local agency that existed prior to January 1, 1989, to adopt an ordinance protecting a residential occupant from the involuntary termination of residential public utility service.
This section preempts any statute or ordinance permitting punitive damages against any owner, manager, or operator on account of an involuntary termination of residential public utility service or permitting the recovery of costs associated with the formation, maintenance, and termination of a tenant’s association.
For purposes of this section, “representative of the residential occupants” does not include a tenants’ association.
The decision of a district to require a new residential applicant to deposit a sum of money with the district prior to establishing an account and furnishing service shall be based solely upon the creditworthiness of the applicant as determined by the district.
No municipal utility district owning or operating a public utility furnishing services for residential use to a tenant under an account established by the tenant shall seek to recover any charges or penalties for the furnishing of services to, or for the tenant’s residential use from, any subsequent tenant or the property owner due to nonpayment of charges by a previous tenant. For this purpose, the term “subsequent tenant” shall not include any adult person who lived at the residence during the period that the charges or penalties accrued. The district may collect a deposit from the tenant service applicant prior to establishing an account for the tenant. The district may not require that service to subsequent tenants be furnished on the account of the landlord or property owner unless the property owner voluntarily agrees to that requirement, nor may the district refuse to furnish services to a tenant in the tenant’s name based on the nonpayment of charges by a previous tenant.
A district subject to this section may not demand or receive security in an amount that exceeds twice the estimated average periodic bill or three times the estimated average monthly bill.
In the event of tenant nonpayment of all or a portion of the bill, the deposit shall be applied to the final bill issued when service is terminated.
This section shall not apply to master-metered apartment buildings.
A district furnishing its inhabitants with light, water, power, or heat shall not terminate residential service for nonpayment of a delinquent account unless the district first gives notice of the delinquency and impending termination, as provided in Section 12823.1.
A district shall not terminate residential service for nonpayment in any of the following situations:
During the pendency of an investigation by the district of a customer dispute or complaint.
When a customer has been granted an extension of the period for payment of a bill.
On the certification of a licensed physician and surgeon that to do so will be life threatening to the customer and the customer is financially unable to pay for service within the normal payment period and is willing to enter into an amortization agreement with the district pursuant to subdivision (e) with respect to all charges that the customer is unable to pay before delinquency.
A residential customer who has initiated a complaint or requested an investigation within five days of receiving a disputed bill, or who has, within 13 days of the mailing of the notice required by subdivision (a), made a request for an extension of the payment period of a bill asserted to be beyond the means of the customer to pay in full during the normal period for payment, shall be given an opportunity for review of the complaint, investigation, or request by a review manager of the district. The review shall include consideration of whether the customer shall be permitted to amortize the unpaid balance of the account over a reasonable period of time, generally within 12 months, but a district may grant a longer period of time if the district finds a longer period of time is necessary to avoid undue hardship to the customer based on the individual circumstances of the case. No termination of service shall be effected for any customer complying with an amortization agreement, if the customer also keeps the account current as charges accrue in each subsequent billing period.
A customer whose complaint or request for an investigation pursuant to subdivision (c) has resulted in an adverse determination by the district may appeal the determination to the board. A subsequent appeal of the dispute or complaint to the board is not subject to this section.
A customer meeting the requirements of paragraph (3) of subdivision (b) shall, upon request, be permitted to amortize the unpaid balance of any bill asserted to be beyond the means of the customer to pay within the normal period for payment, generally within 12 months, but a district may grant a longer period if the district finds a longer period is necessary to avoid undue hardship to the customer based on the individual circumstances of the case.
A district furnishing light, heat, water, or power shall not terminate residential service on account of nonpayment of a delinquent account unless the district first gives notice of the delinquency and impending termination, at least 10 days prior to the proposed termination, by means of a notice mailed, postage prepaid, to the customer to whom the service is billed not earlier than 19 days from the date of mailing the district’s bill for services, and the 10-day period shall not commence until five days after the mailing of the notice.
Every district shall make a reasonable attempt to contact an adult person residing at the premises of the customer by telephone or personal contact, at least 24 hours prior to any termination of service, except that, whenever telephone or personal contact cannot be accomplished, the district shall give, by mail, in person, or by posting in a conspicuous location at the premises, a notice of termination of service, at least 48 hours prior to termination.
Every district shall make available to its residential customers who are 65 years of age or older, or who are dependent adults as defined in Section 15610.23 of the Welfare and Institutions Code, a third-party notification service, whereby the district will attempt to notify a person designated by the customer to receive notification when the customer’s account is past due and subject to termination. The notification shall include information on what is required to prevent termination of service. The residential customer shall make a request for third-party notification on a form provided by the district, and shall include the written consent of the designated third party. The third-party notification does not obligate the third party to pay the overdue charges, nor shall it prevent or delay termination of service.
Every notice of termination of service pursuant to subdivision (a) shall include all of the following information:
The name and address of the customer whose account is delinquent.
The amount of the delinquency.
The date by which payment or arrangements for payment is required in order to avoid termination.
The procedure by which the customer may initiate a complaint or request an investigation concerning service or charges, except that, if the bill for service contains a description of that procedure, the notice pursuant to subdivision (a) is not required to contain that information.
The procedure by which the customer may request amortization of the unpaid charges.
The procedure for the customer to obtain information on the availability of financial assistance, including private, local, state, or federal sources, if applicable.
The telephone number of a representative of the district who can provide additional information or institute arrangements for payment.
Every notice of termination of service pursuant to subdivision (b) shall include the items of information in paragraphs (1), (2), (3), (6), and (7).
All written notices shall be in a clear and legible format.
If a residential customer fails to comply with an amortization agreement, the district shall not terminate service without giving notice to the customer at least 48 hours prior to termination of the conditions the customer is required to meet to avoid termination, but the notice does not entitle the customer to further investigation by the district.
A termination of service shall not be effected without compliance with this section. Any service wrongfully terminated shall be restored without charge for the restoration of service, and a notation thereof shall be mailed to the customer at the customer’s billing address.
No electrical, gas, heat, or water municipal utility district shall, by reason of delinquency in payment for any electric, gas, heat, or water services, cause cessation of any such services on any Saturday, Sunday, legal holiday, or at any time during which the business offices of the district are not open to the public.
A district furnishing light, heat, or power may engage in activities to reduce wasteful, uneconomical or unnecessary uses of energy, including, but not limited to, public information programs, the sale of insulation, the sale, rental and lease of materials or equipment for the purpose of conserving energy or reducing the need for the installation of electric generating facilities, and the adoption of voluntary and mandatory load management programs, and may also engage in activities to accelerate and participate in the development of alternative sources of energy including, but not limited to, the supply of equipment for use in connection therewith, and may do all things necessary or convenient to the full exercise of the powers herein granted. The interest rates charged on extended payment contracts for such materials or equipment shall not exceed that necessary to cover the district’s full cost of money plus its administrative costs and anticipated losses due to nonpayment on such contracts.
This section does not constitute a change in, but is declaratory of, the existing law.
Every district shall comply with Section 8029.5.
The board of a district that has owned and operated an electric distribution system for at least eight years and has a population of 250,000 or more may engage in programs to encourage economic development that benefits its ratepayers.
ARTICLE 5a. Claims [12830. - 12830.]
ARTICLE 6. Indebtedness [12841. - 12844.]
A district may borrow money and incur indebtedness, and may issue bonds or other evidences of indebtedness. No indebtedness shall be incurred exceeding the ordinary annual income and revenue of the district without the approval of two-thirds of the voters voting on the proposition to incur such indebtedness except as follows:
A further vote of the voters is not required for any indebtedness heretofore or hereafter incurred within the purposes and not exceeding the available amount of any previously authorized bond issue, and as to such indebtedness the proceeds of any of the bonds unexpended in the treasury of the district, or the par value of any of the bonds which are unsold shall be deemed a part of the ordinary annual income and revenue of the district.
Any district operating a utility under rules requiring applicants for extensions to advance the expenses of such extensions and facilities for serving additional territory may enter into agreements to refund to the applicants in a subsequent year the whole or any part of the expenses so advanced, and the refunds may be paid out of the revenues of subsequent years.
No district shall incur an indebtedness for public works which in the aggregate exceeds 20 percent of the assessed value of all the real and personal property within the district.
Indebtedness which has been incurred for the construction and operation of a public utility, where the revenue from the utility for three years or more next preceding has been sufficient to pay the interest and principal due on any bonds issued for its construction or acquisition, in addition to the cost of operation and maintenance, shall not be counted and included in ascertaining the limit of indebtedness, and any indebtedness incurred for the acquisition, construction or operation of a public utility within any special district shall be excluded in ascertaining the aggregate indebtedness specified in Section 12842.
A district may accept, without limitation by any other provisions of this division requiring approval of indebtedness, contributions or loans from the United States, or any department, instrumentality, or agency thereof, for the purpose of financing the construction, maintenance, and operation of any enterprise in which the district is authorized to engage, and may enter into contracts and cooperate with, and accept cooperation from, the United States, or any department, instrumentality, or agency thereof, in the construction, maintenance, and operation, and in financing the construction, maintenance, and operation, of any such enterprise in accordance with any legislation which Congress may have heretofore adopted or may hereafter adopt, under which aid, assistance, and cooperation may be furnished by the United States in the construction, maintenance, and operation or in financing the construction, maintenance, and operation of any such enterprise. A district may do any and all things necessary in order to avail itself of such aid, assistance, and cooperation under any federal legislation now or hereafter enacted. Any evidence of indebtedness issued under this section shall constitute a negotiable instrument.
ARTICLE 6a. Electric, Water, Communications, or Sewage Disposal System Improvements [12850. - 12857.]
This article shall apply only to districts which have owned and operated an electric distribution, water distribution, or sewage disposal system for at least eight years and which have a population of 250,000 or more.
A district may, from time to time, issue bonds in accordance with the Revenue Bond Law of 1941 (Chapter 6 (commencing with Section 54300) of Part 1 of Division 2 of Title 5 of the Government Code), as it now reads or as hereafter amended, for the purpose of financing the construction, reconstruction, replacement, acquisition, or improvement of any facility or facilities necessary or convenient for the generation, transmission, or distribution of electricity; the storage, transmission, or distribution of water; the furnishing of communications services; or the disposal of sewage; or incidental to, or in connection with, the operation of the electric, water, communications, or sewage disposal system or facilities of the district, or for purposes of financing programs for the conservation of electricity, which shall constitute an “enterprise” within the meaning of Section 54309 of the Government Code. The authority hereby granted to the districts is in addition to all powers granted local agencies under the Revenue Bond Law of 1941, and Section 54310 of the Government Code, insofar as it is inconsistent with that authority, shall not apply.
Article 3 (commencing with Section 54380) of Chapter 6 of Part 1 of Division 2 of Title 5 of the Government Code, the limitations on the rate of interest set forth in subdivision (b) of Section 54402 of the Government Code and on the discount set forth in Section 54418 of the Government Code, and the requirements for refunding revenue bonds set forth in Sections 53573, 53583, 54388, and 54661 of the Government Code do not apply to the issuance and sale of bonds pursuant to this article. Whenever a district proposes to exercise the power to issue bonds pursuant to this article, the board shall adopt a preliminary resolution declaring its intention to authorize the issuance of bonds, which resolution shall specify all of the following:
The purpose for which the proposed bonds are to be issued.
The maximum principal amount of the bonds then proposed to be issued.
The maximum term for which any of the bonds are to run.
The maximum rate of interest to be payable upon the bonds which rate shall be determined by the board.
The maximum discount, which shall be determined by the board.
When bonds are issued under this article, the preliminary resolution of the board adopted pursuant to this article shall take effect upon its adoption by the board subject to the right of referendum provided for in this article. Successive issues of bonds may be authorized under this article from time to time and the authority herein contained shall not be limited to any particular issue.
Upon any such resolution taking effect subject to the right of referendum pursuant to this article, the board shall cause the same to be published in the manner provided for the publication of notices. At any time within 60 days after the date of the second such publication a referendum petition, signed by voters in number equal to at least 3 percent of the total vote cast, as defined in Section 11507, demanding the submission of such resolution to a vote of the voters of the district for their assent to the issuance of the proposed bonds, may be filed with the secretary. Upon presentation to the secretary of a referendary petition, the resolution which is the subject thereof shall be of no effect unless and until it has been assented to by the voters.
If no such referendary petition is presented within the period of 60 days, then upon the expiration of such period, or if the proposition of issuing the bonds specified in the resolution of the board adopted pursuant to this article has been assented to by a majority of the voters voting on the proposition, whether upon referendum or pursuant to Section 12856, then upon such proposition having been so assented to, the resolution shall take full and final effect, and the board may proceed in accordance with the provisions of this article and issue bonds within the terms of the resolution and in accordance with the applicable provisions of the Revenue Bond Law of 1941 (Chapter 6 (commencing with Section 54300), Part 1, Division 2, Title 5, Government Code).
The board at any time may, and upon the filing of a referendum petition as provided in Section 12854 shall, adopt a resolution calling a special election for the purpose of submitting to the voters of the district the proposition of issuing revenue bonds in conformity with the preliminary resolution adopted pursuant to Section 12852. The resolution calling the election shall fix the date on which the election is to be held, the proposition to be submitted thereat, the manner of holding the election and of voting for or against the proposition, and shall state that in all other particulars the election shall be held and the votes canvassed as provided by law for the holding of elections within the district. Such election may be held separately or may be consolidated with any other election authorized by law at which the voters of the district may vote. The resolution calling the election shall be published and no other notice of the election need be given. The votes of a majority of all the voters voting on the proposition at the election are required to authorize the issuance of revenue bonds.
The authority herein contained shall be in addition to the authority conferred by Chapter 7 of this division and indebtedness incurred in accordance with the authority herein contained shall not be included in ascertaining the aggregate indebtedness specified in Section 12842.
ARTICLE 6b. Bonds [12860. - 12860.]
Bonds issued by a district, pursuant to Article 8 (commencing with Section 53540) of Chapter 3 of Part 1 of Division 2 of Title 5 of the Government Code, may bear interest at the rate or rates as may be fixed by the board of directors without regard to the limitations set forth in Section 53541 of the Government Code, and may be sold at a discount, as determined by the board of directors.
ARTICLE 7. Investments [12871. - 12875.]
A district may invest any surplus money in its treasury, including money in any sinking fund, in any of the following:
Its own bonds, whether issued on behalf of the entire district or any special district.
Treasury notes, certificates of indebtedness, bills, bonds of the United States, or any other evidence of indebtedness secured by the full faith and credit of the United States.
Obligations issued pursuant to the Federal Home Loan Bank Act or the National Housing Act.
Treasury notes or bonds of this state, or of any public corporation, municipal corporation, public district, or political subdivision within this state which are legal as security for the deposit of public funds.
Obligations issued by federal intermediate credit banks, federal land banks, and banks for cooperatives.
Obligations issued or assumed by the International Bank for Reconstruction and Development, the Tennessee Valley Authority, the Inter-American Development Bank, or Export-Import Bank of Washington participation certificates.
Banker’s acceptances of banks having total deposits of one billion dollars ($1,000,000,000) or more.
Any securities in which savings banks in this state may legally invest their funds pursuant to Sections 1350 to 1366, inclusive, of the Financial Code; provided, that the provisions of said sections limiting the amount which a savings bank may invest in securities to a specified percent of its paid-up capital and surplus, or savings deposits, shall not apply to investments authorized by the terms of this section.
Such investment may be made by direct purchase of any issue of such bonds, treasury notes, or obligations, or part thereof, at the original sale or by the subsequent purchase of the bonds, treasury notes, or obligations.
Any bonds, treasury notes, or obligations purchased and held as investments by the district may from time to time be sold and the proceeds reinvested in bonds, treasury notes, or obligations as provided in this article.
Sales of any bonds, treasury notes, or obligations purchased and held by the district shall from time to time be made in season so that the proceeds may be applied to the purposes for which the money with which the bonds, treasury notes, or obligations were originally purchased was placed in the treasury of the district.
Notwithstanding any other provision of law, a district which has owned and operated a water distribution or sewage disposal system for at least eight years and which has a population of 250,000 or more may enter into contracts commonly known as “interest rate swap agreements” or “forward payment conversion agreements” with any person providing for the exchange of payments between the person and the district including, without limitation, contracts providing for the exchange of fixed interest payments for floating payments or floating interest payments for fixed payments, or a combination thereof, after giving due consideration for the creditworthiness of the counter parties, where applicable, including any rating by a nationally recognized agency or such other criteria as may be appropriate. The contracts may be made upon the terms and conditions established by the board. The authority conferred by this section includes the authority to enter into any and all contracts incident to the exercise of the authority conferred by this section including, without limitation, contracts to obtain credit enhancement devices and contracts for the performance of professional services.
ARTICLE 8. Taxation [12891. - 12904.]
A district may levy, and collect or cause to be collected, taxes for any lawful purpose.
A district may impose a special tax pursuant to Article 3.5 (commencing with Section 50075) of Chapter 1 of Part 1 of Division 1 of Title 5 of the Government Code. The special taxes shall be applied uniformly to all taxpayers or all real property within the district, except that unimproved property may be taxed at a lower rate than improved property.
If, in the opinion of the board, the revenues will not be sufficient for any and all lawful purposes the board shall levy a tax for such purpose or purposes and fix the amount of money necessary to be raised therefor by taxation.
The board shall, at the time of fixing the general tax levy and in the manner provided for the general tax levy, levy and collect annually until the district’s bonds are paid, or until there is a sum in the treasury of the district set apart for that purpose to meet all sums coming due for principal and interest on the bonds, a tax sufficient to pay the annual interest on the bonds and such part of the principal thereof as becomes due before the time for fixing the next general tax levy. If the maturity of the indebtedness created by the issue of bonds begins more than one year after the date of the issuance thereof, the tax shall be levied and collected annually at the time and in the manner aforesaid, sufficient to pay the interest on the indebtedness as it falls due and to constitute a sinking fund for the payment of the principal on or before maturity.
The taxes required to be levied and collected on account of interest, principal, and sinking fund of district bonds shall be in addition to all other taxes levied for district purposes, and shall be collected at the time and in the same manner as other district taxes are collected, and be used for no other purpose than the payment of the bonds and accruing interest.
Nothing in this division prevents the issuance of revenue bonds by a district for the entire district or any special district created therein under any provision of law permitting the issuance of revenue bonds by municipal utility districts.
The board may provide for the assessment, levy, and collection of taxes by the district, including the sale of property to the district for delinquent taxes, with penalties, interest, and cost.
The board may elect to avail itself of the assessments made by the assessors of the counties in which the district is situated, and of the assessments made by the State Board of Equalization for those counties, and may take such assessments as the basis for district taxation and have its taxes collected by the county officials if the board declares its election so to do by resolution or ordinance and files a certified copy of the resolution or ordinance on or before the first day of August with the auditors of the counties in which the district is situated. Thereafter, each year and until otherwise provided by the board, all assessments shall be made for the district by the State Board of Equalization and the county assessors, and all taxes shall be collected for the district by the tax collectors, of the counties in which the district is situated.
In such case the county auditor shall, on or before August 15th of each year, transmit to the board a statement in writing showing the total value of all property within the district, ascertained from the assessments referred to in Section 12897 as equalized.
In case the board elects to avail itself of the assessments referred to in Section 12897 it shall, on or before the first week day in September, or if such week day falls upon a holiday then on the first business day thereafter, fix the rate of taxes, designating the number of cents upon each hundred dollars, using as a basis the value of property transmitted to the board by the county auditors, which rate of taxation shall be sufficient to raise the amount previously fixed by the board. These acts by the board shall constitute a valid assessment of the property and a valid levy of the taxes so fixed.
The board shall immediately after fixing the rate of taxes as above provided transmit to the county auditors of the counties in which the district is situated a statement of the rate of taxes fixed by the board.
The district’s taxes so levied shall be collected at the same time and in the same manner as county taxes. When collected the net amount, ascertained as provided in this article, shall be paid to the treasurer of the district, under the general requirements and penalties provided by law for the settlement of other taxes. The district may adopt the alternative procedure of tax collection and apportionment established by Chapter 3, Part 8, Division 1 of the Revenue and Taxation Code and any amendments thereof; provided, however, that the district may thereafter abandon said alternative procedure at the end of any fiscal year of the district.
Whenever any real property situate in any district which has availed itself of the provisions of Section 12897 has been sold for taxes and has been redeemed, the money paid for redemption shall be apportioned and paid to the district by the county treasurers receiving it in the proportion which the tax due to the district bears to the total tax for which the property was sold.
The compensation to be charged by and paid to any county for the performance of services under this article shall be fixed by agreement between the board of supervisors of the county and the board. The compensation shall in no event exceed one-half of 1 percent of all money collected for the district. The compensation collected by the county shall be placed to the credit of the county salary fund.
All taxes levied under this division are a lien on the property on which they are levied. Unless the board has by ordinance otherwise provided, the enforcement of the collection of such taxes shall be in the same manner and by the same means provided by law for the enforcement of liens for county taxes, all the provisions of law relating to the enforcement of the latter being made a part of this division, so far as applicable.
ARTICLE 9. Improvement Act of 1911 [12921. - 12922.]
The Improvement Act of 1911 may be used by a district formed pursuant to this division for the construction of water facilities. In the application of said improvement act to proceedings instituted by such district, the terms used in said improvement act shall have the following meanings:
“City council” and “council” mean the board of the district.
“Municipality” and “city” mean district.
“Clerk” and “city clerk” mean secretary of the board.
“Superintendent of streets,” “street superintendent” and “city engineer” mean the engineer appointed by the district to perform the engineering work for the assessment district.
“Tax collector” means county tax collector.
“Treasurer” and “city treasurer” mean the person or officer who has charge of and makes payment of the funds of the district.
“Right-of-way” shall mean any parcel of land over which the district shall have an easement for the purpose of constructing or maintaining water or sewer lines.
The powers and duties conferred by the Improvement Act of 1911 on boards, officers and agents of cities shall be exercised by the respective boards, officers and agents of the district.
ARTICLE 11. Municipal Improvement Act of 1913 [13010. - 13010.]
The Municipal Improvement Act of 1913 may be used by a district formed pursuant to this division for any purpose or purposes which a district may carry out.
ARTICLE 12. Irrigation Standby or Immediate Availability Charge [13021. - 13024.]
This article shall apply only to the ownership, operation, control, or use by a district of a system for the distribution of irrigation water and shall not affect, but shall be in addition to, the right of the board of directors of the district to fix rates and charges, and to supervise and regulate every utility owned and operated by the district pursuant to this division.
A district which acquires, constructs, owns, operates, controls, or uses works for supplying its inhabitants and lands within the district with irrigation water, may, pursuant to the notice, protest, and hearing procedures in Section 53753 of the Government Code, fix by resolution on or before the first day of July of each year a water standby or immediate availability charge on all land within its boundaries to which water is made available by the district for irrigation purposes, whether the water is actually used or not. Such charge shall not apply to lands permanently dedicated exclusively to transportation of persons or property.
The board of directors of a district which fixes such a standby charge may establish schedules varying the charges in different areas within a district. The board of directors may not, however, fix an annual standby charge at a rate in excess of ten dollars ($10) per acre or portion thereof, unless the standby charge is imposed pursuant to the Uniform Standby Charge Procedures Act (Chapter 12.4 (commencing with Section 54984) of Part 1 of Division 2 of Title 5 of the Government Code).
If the procedures set forth in this section as it read at the time a standby charge was established were followed, the district’s board may, by resolution, continue the charge pursuant to this section in successive years at the same rate. If new, increased, or extended assessments are proposed, the board shall comply with the notice, protest, and hearing procedures in Section 53753 of the Government Code.
Any district levying a standby charge, which has elected under Section 12897 to use county and state assessment and tax collection procedures, shall, on or before the first day of August of each year, furnish in writing to the county auditor of each affected county a description of each parcel of land within the district upon which a standby charge has been levied for the current fiscal year, together with the amount of standby charge fixed by the district on each parcel of land.
All county officers charged with the duty of collecting taxes shall collect district standby charges with the regular tax payments to the county. Such charges shall be collected in the same form and manner as county taxes are collected and shall be paid to the district. Charges fixed by the district shall be a lien on all the property benefited thereby. Liens for such charges shall be of the same force and effect as other liens for taxes, and their collection may be enforced by the same means as provided for the enforcement of liens for state and county taxes.
Any funds derived from the standby charges levied pursuant to this article may be used by the district for all purposes which a district is authorized to expend funds insofar as such purposes relate to the acquisition of a water supply or the acquisition, construction, operation, control, or use of works for supplying land within the district with irrigation water.
CHAPTER 6.5. Electric System Improvements [13071. - 13193.]
ARTICLE 1. Application [13071. - 13073.]
This chapter is complete authority for the issuance of bonds hereunder, and no action or proceeding not required by this chapter shall be necessary for the valid authorization and issuance of such bonds.
Unless otherwise clearly indicated by the context, all of the provisions of this chapter shall be understood as relating only to bonds issued under this chapter.
This chapter shall apply only to districts which have owned and operated an electric distribution system for at least 10 years and which have a population of 250,000 or more.
ARTICLE 2. Definitions [13081. - 13085.]
Unless the context otherwise requires, the provisions of this article govern the construction of this chapter.
“Bonds” includes the meaning of “notes, certificates and other evidences of indebtedness” and in every case refers only to bonds issued under this chapter, whether so specified or not.
“Refund” includes the meaning of “extend” and “renew.”
“Assented to by the voters” means that the proposition indicated by the context has been submitted to the voters of the district, and has been assented to by a majority of those voters who voted upon that proposition at the election.
“Payments on principal” means payments on account of the principal of bonds, whether upon maturity or by payments into a sinking fund on account of principal, and includes premiums required to be paid on the mandatory redemption of sinking fund bonds.
ARTICLE 3. General Authorization [13091. - 13096.]
A district may borrow money from time to time for the purpose of constructing, reconstructing, replacing, extending or improving its system for supplying the district and its inhabitants with electric energy, and may issue and sell bonds to evidence the indebtedness created by such borrowing. No such money may be used:
For constructing or improving works located outside the district boundaries which exist on the date this Chapter 6.5 is enacted.
For acquiring any property owned by a public utility.
For constructing or improving works for generating electricity.
For constructing or improving works used, or to be used, in whole or in part either for the receipt, transmission and delivery of electric energy for any supplier of electric power or for the exchange of electric power with any person or entity. This provision shall not prevent the district from using such money for the purposes set forth in the initial sentence of this section.
Such bonds shall not be issued for a term in excess of 20 years after the date of such bonds; provided, that this sentence shall not limit the power of a district to refund such bonds.
A district may also refund from time to time, whether at or prior to maturity, any outstanding indebtedness evidenced by its bonds, and may issue, and sell or exchange, bonds so to refund such indebtedness. Refunding bonds which are to be sold may be issued and sold at such time in advance of the time at which the bonds to be redeemed or paid out of the proceeds of such refunding bonds are to be so redeemed or paid as the board may determine.
Whenever a district exercises the power to borrow money pursuant to this chapter the board may authorize the issuance of bonds in any amount which, when added to the aggregate amount of bonds of the district issued under this chapter and outstanding at the time of the acceptance of a proposal for the purchase of the bonds so authorized and payable out of the revenues out of which the bonds so authorized are to be payable shall not exceed the amount of the earned surplus derived from the operation of the electric system to which those revenues pertain, as of the end of the last fiscal year which ended not less than four months prior to the making of the finding and determination provided for in Section 13161. The aggregate amount of bonds issued under this chapter shall not exceed in face value the sum of ten million dollars ($10,000,000) in any one calendar year. The term “earned surplus” whenever used in this chapter means the excess of revenues from the inception of operation of the electric system over related expenses thereof, plus accumulated price-level depreciation, plus or minus any additional amounts credited to or charged against customers’ equity employed in the business of the electric system, as determined in accordance with the then current accounting practice of the district. The term “accumulated price-level depreciation” as used in this section means the accumulated additional amounts by which depreciation based on the cost of depreciable property adjusted to reflect current price levels exceeds depreciation computed on cost.
The limitations prescribed in Section 13093 shall not be applicable to the issuance of any refunding bonds pursuant to this chapter, and the amount of any issue of such refunding bonds may equal, but shall not exceed, the amount required for the payment or redemption of the bonds to be refunded thereby, including the premiums, if any, due upon such redemption, but excluding any interest due upon such redemption.
Any bond for the payment and discharge of which, upon maturity or upon redemption prior to maturity, provision has been made through the setting apart in a reserve fund or special trust account created pursuant to this chapter to insure the payment thereof, of moneys sufficient for that purpose, or through the irrevocable segregation for that purpose, in some sinking fund or other fund or trust account, of moneys sufficient therefor, shall be deemed to be no longer outstanding within the meaning of any provision of this chapter.
The board shall have power to determine all the terms and conditions of the issuance and sale of bonds pursuant to this chapter, excepting only as such power is limited by express provisions of this chapter.
ARTICLE 4. Proceedings for Issuance [13101. - 13107.]
Whenever a district proposes to exercise the power to borrow money, or to refund indebtedness, pursuant to this chapter, the board shall adopt a preliminary resolution declaring its intention to authorize the issuance of bonds for such purpose, which resolution shall specify all of the following:
The purpose for which the proposed bonds are to be issued.
The maximum principal amount of the bonds proposed to be issued in the then current calendar year.
The maximum term for which any of said bonds are to run.
The maximum rate of interest to be payable upon such bonds.
The maximum premium, if any, to be payable on the redemption of any such bonds.
When bonds are issued under this chapter, the preliminary resolution of the board adopted pursuant to this article shall take effect upon its adoption by the board subject to the right of referendum herein provided for.
Upon any such resolution taking effect subject to the right of referendum, pursuant to this article, the board shall cause the same to be published in the manner provided for the publication of notices. At any time within 60 days after the date of the second such publication a referendary petition, signed by voters in number equal to at least 3 percent of the total vote cast, as defined in Section 11507, demanding the submission of such resolution to a vote of the voters of the district for their assent to the issuance of the proposed bonds, may be filed with the secretary. Upon presentation to the secretary of a referendary petition, the resolution which is the subject thereof shall be of no effect unless and until it has been assented to by the voters.
If no such referendary petition is presented within the aforesaid period of 60 days, then upon the expiration of said period, or if the proposition of issuing the bonds specified in the resolution of the board adopted pursuant to this article has been assented to by the voters, whether upon referendum or pursuant to any other provisions of this chapter, then upon such proposition having been so assented to, the resolution shall take full and final effect, and the board may proceed in accordance with the provisions of this chapter and issue bonds within the terms of the resolution.
The provisions of any resolution constituting a part of the proceedings for the issuance of any bonds under this chapter, when so declared by its terms, or by the terms of any other such resolution, shall constitute a contract between the district and the holders of such bonds, and the provisions thereof shall be enforceable by mandamus or any other appropriate suit, action or proceeding at law or in equity in any court of competent jurisdiction.
The board at any time may adopt a resolution providing for submission to the voters of the district of the proposition of assenting to any proposed action of the board in any case where such assent is required or permitted by the terms of this chapter, or in any case where the board may deem such submission to be desirable. Such resolution may provide for such submission at any specified regular district election, or at any special election. Such resolution and such election shall, except to the extent otherwise provided in this chapter, conform to the requirements of Article 1, Chapter 7, of this division. The board shall do, or cause to be done, any and all things necessary to make such submission at the election indicated by its resolution and to determine and certify the result thereof.
ARTICLE 5. Sources of Payment [13111. - 13112.]
All bonds issued by a district pursuant to this chapter shall be, and shall recite upon their face that they are, payable both as to principal and interest, and as to any premiums upon the redemption thereof, out of the revenues pertaining to the electric system on account of which the indebtedness evidenced by such bonds was created, and not out of any other fund or moneys of the district.
The provisions of this article shall not preclude any of the following:
The payment of any such principal, interest or premiums through appropriate reserve funds or special trust accounts, established as hereinafter in this article provided.
The payment of interest on or principal of bonds of any such issue out of sums received as premiums or accrued interest on the sale of that issue.
The payment of any such principal or premiums out of the proceeds of the sale of refunding bonds issued for that purpose.
The payment out of the proceeds of any bonds of the whole or a part of the interest accruing on said bonds during the period of the performance of work to be paid for out of such proceeds.
The payment of any such principal, interest or premiums by the purchasers of any such bonds, or by any entity, public or private, other than the district, in any case where any such purchaser or entity may have guaranteed such payment.
ARTICLE 6. Reserve Funds [13121. - 13124.]
In connection with the exercise of the power to borrow money, to issue bonds, and to refund indebtedness, pursuant to this chapter, the board may, from time to time, establish and maintain a reserve fund or funds in the district treasury, or a special trust account or accounts with an agent or agents designated by the board as a sinking fund or otherwise, to insure the payment, when due or payable, whether at maturity or upon redemption, of the principal of, and interest on, bonds issued as aforesaid, including premiums, if any, due upon the redemption of any thereof, or for any of said purposes. Money in any such reserve fund may be used for the purchase of bonds of the issue in connection with which it was established, for cancellation and retirement pursuant to any mandatory requirement of the redemption of sinking fund bonds. Each such fund or account shall be established and maintained out of the revenues pertaining to the electric system on account of which such power is exercised or out of any moneys which under the terms of this article are applicable to the purpose, through transfers or payments made at such times and in such amounts as the board may direct.
Money set aside and placed in any such reserve fund or special trust account shall remain therein until from time to time expended for the purposes thereof, and shall not be used for any other purpose whatsoever, except for temporary investment thereof as provided in this chapter; provided, however,
That money may be paid or transferred from any such fund or account in furtherance of the purpose of its establishment, to any other such fund or account established for a like purpose in connection with the same issue of bonds, to such extent as may be required or permitted under the terms of the resolution authorizing that issue; and
That all money remaining in any such fund or account in excess of the amount required to make provision for the payment in full of the principal of, and interest on, the bonds with respect to which it was established, including premiums, if any, due upon the redemption of any thereof, may be returned and transferred to the revenue fund out of which such reserve fund was established.
Money in any such reserve fund shall be drawn therefrom only upon demands authenticated by the signature of the accountant of the district; provided, however, that the board may, in its discretion, direct and authorize the payment from such reserve fund, by the treasurer, without such authenticated demand, (i) of bonds of the issue in connection with which such reserve fund is so established when due upon maturity or call, or of coupons pertaining to bonds of such issue when due, but only upon presentation and surrender of such bonds or coupons, (ii) of interest upon registered bonds of such issue when due, or (iii) of premiums, if any, due upon the redemption of any such bonds.
Money in any such special trust account shall be drawn therefrom only in accordance with directions given or authorized by the board.
ARTICLE 7. Obligation to Bondholders [13131. - 13136.]
So long as any bonds of the district are outstanding and unpaid, or so long as provision has not been made for the full payment and discharge of all such outstanding bonds, upon maturity, or upon redemption prior to maturity, through the setting apart in a reserve fund or special trust account created pursuant to this article to insure the payment thereof, of money sufficient for that purpose, or through other irrevocable allocation to that purpose of money sufficient therefor all provisions of this article shall be complied with.
The board shall fix rates for service from the electric system to which the indebtedness pertains, and collect charges for such service, such as to provide revenues at least sufficient in the aggregate to pay, as the same shall become due, the principal and interest on all such bonds so outstanding payable out of those revenues, including premiums, if any, due upon the redemption of any thereof, in addition to paying, as the same shall become due, the necessary expenses of operating and maintaining such system, and all other obligations and indebtedness payable out of those revenues.
Bonds issued under this chapter shall be issued without any priority with respect to payment of principal or interest.
The electric system of the district to which the indebtedness pertains shall not be sold or otherwise disposed of, as a whole or substantially as a whole, unless such sale or other disposition be so arranged as to provide for a continuance of payments into a fund sufficient in amount to permit payment therefrom of principal of, and interest on, and premiums, if any, due upon the redemption of, all bonds issued under this chapter.
No indebtedness payable out of revenues shall be created in contravention of the provisions of any resolutions heretofore adopted by the board in connection with the authorization of any bonds payable out of revenues.
Anything in this article to the contrary notwithstanding, the board, in any resolution constituting a part of the proceedings for the issuance of any issue of bonds under this chapter may determine that the holders of the bonds of that issue are not to be entitled to the benefits of or to enforce any or all of the provisions of this article, and to that end the board, in such resolution, shall specify the provisions of this article to the benefits of which the holders of the bonds of that issue shall be entitled; and the holders of the bonds of that issue shall not be entitled to the benefits of or to enforce any of the provisions of this article not so specified.
ARTICLE 8. Consents of Bondholders [13141. - 13142.]
The board may provide in the resolution authorizing the issue of any bonds under this chapter that any act consented to by the holders of 60 percent in aggregate principal amount of the outstanding bonds of any issue of bonds issued under this chapter, pursuant to provisions for such consents contained in any resolution of the board constituting a part of the proceedings for the issuance of such bonds, shall not, as to the bonds of that issue, be deemed an infringement of any of the provisions of Article 7 of this chapter, or of any covenant made pursuant thereto, whatever the character of such act may be.
The board may provide in the resolution authorizing the issue of any bonds under this chapter the terms and conditions upon which any provision of any resolution of the board constituting a part of the proceedings for the issuance of such bonds, or any provision of such bonds or coupons appurtenant thereto, may be modified if consented to by the holders of any percentage, specified in such resolution authorizing the issue of such bonds, of the aggregate principal amount of the outstanding bonds of such issue.
ARTICLE 9. Form and Content [13151. - 13152.]
Without limiting in any way the generality of its power, the board is expressly authorized, in its discretion, to provide, in connection with any issue of bonds under this chapter all the matters contained in this article.
The board may provide for such bonds being in such amounts, of such denominations, payable at such times, and in such form as the board may determine.
The board may provide for such bonds being negotiable or nonnegotiable.
The board may provide for such bonds and the interest thereon, and premiums, if any, due upon the redemption of any thereof, being payable or collectible at any place or places, within or without the State of California, and without presentation and approval of demands.
The board may provide for such bonds being payable to bearer or only to the registered holder, either as to principal alone, or as to both principal and interest; for such bonds being with or without coupons; for such bonds being nonregisterable, or registerable, either as to principal alone, or as to both principal and interest; for such bonds being exchangeable or nonexchangeable, convertible or nonconvertible; and for the reissuance of bonds or coupons which have been surrendered and preserved, or for the issuance of new bonds or coupons in the place of bonds or coupons which have been surrendered and canceled, wherever appropriate as incident to the discharge of any bond from registration, or to any exchange or conversion of any bond; all on such terms and conditions, and at such place or places, within or without the State of California, as the board may determine.
The board may provide for such bonds being redeemable, either at the option of the district, or in the operation of any sinking fund provided for the issue, at such price or prices and in such manner as the board may determine, whether or not involving the payment of a premium upon such redemption; provided, that no bond shall be subject to redemption unless such bond at the time of its issue states on its face that it is redeemable at the option of the district or by the operation of a sinking fund for bonds of that issue, as the case may be.
The board may provide for the issuance by the district of a duplicate, in the manner and on such terms and conditions as the board may determine, in the event any bond, temporary bond, coupon or interim receipt of any such issue is lost, destroyed or mutilated.
The board may provide for the appointment and payment of fiscal, paying, sinking fund or other agents, or of trustees or registrars.
The board may provide for the appointment of the treasurer of the district to act as such fiscal, paying, sinking fund or other agent.
The board may provide for the custody by the district of bonds and coupons, whether pending delivery or after purchase or surrender; for the delivery of bonds and coupons by the district to the purchaser thereof; for the receipt by the district of the proceeds of the sale and for the depositing of such proceeds in the proper fund or funds.
The board may provide for the sale of any such bonds upon such terms and conditions as the board in its discretion may determine at public sale. Bonds may be sold by the board below the par or face value thereof, at a discount not to exceed 6 percent of par value; provided further, that in the case of refunding bonds the board may provide for the refunding being made, in whole or in part, by the exchange of such refunding bonds for the bonds to be refunded. Before selling the bonds, or any part thereof, the board shall give notice not less than 10 days prior to the date of sale by publication in a newspaper of general circulation circulating in the district inviting sealed bids in such manner as the board shall prescribe. If satisfactory bids are received, the bonds offered for sale shall be awarded to the highest responsible bidder. If no bids are received, or if the board determines that the bids received are not satisfactory as to price or responsibility of the bidders, the board may reject all bids received, if any, and either readvertise or sell the bonds at private sale.
The board may provide for the issuance of interim receipts or of temporary bonds, in such form as the board may prescribe, pending the issuance of definitive bonds.
The board may provide for any signatures to such bonds and to any coupons thereto attached, and to any interim receipts and temporary bonds, being by facsimile.
The board may provide for restrictions on the incurring of additional indebtedness of the district payable out of the revenues out of which the bonds then authorized are to be payable.
The board may provide for restrictions on future transfers out of the revenues out of which the bonds then authorized are to be payable.
The board may provide for covenants with the holders of bonds to the same effect as set forth in Article 7 of this chapter, which covenants shall not be subject to alteration or repeal, except as in Article 8 of this chapter provided.
The board may provide for the issuance and distribution in such form as the board may determine of official statements respecting proposed issues of bonds and the properties, operations and finances of the works on account of which such bonds are to be issued, for the information of prospective purchasers of such bonds; and, in any case where any proposition is to be submitted to the voters for their assent, whether by referendum or pursuant to any provision of this chapter, for the issuance, distribution, dissemination and publication of factual statements respecting such proposed issues of bonds, and such properties, operations and finances, for the information of such voters.
The board may provide for the making of contracts, or the placing of orders, for the engraving or printing of any bonds, whether definitive or temporary, or of interim receipts, authorized by this chapter, or for any printing incident to the offering or issuance of any such bonds, without advertising for bids, in any case where, because of limitations of time, or requirements as to quality of work, or as to security in the control or custody of plates, or any similar cause, the board may deem it to be in the public interest so to do, anything in this division to the contrary notwithstanding, but in so doing the board shall, if practicable, obtain or cause to be obtained competitive bids, formal or informal, from bidders who can perform work of the required quality within the required time, and, in the case of engraving, who are of proper responsibility and who have adequate facilities for the control and safekeeping of the engraved plates.
Each issue of bonds issued pursuant to this chapter shall conform to the following requirements:
Such bonds shall be serial bonds or sinking fund bonds, or a combination of serial and sinking fund bonds.
Provision shall be made for the retirement of such bonds through annual payments on principal, and such payments shall begin not more than 10 years, and end not more than 20 years, after the date of such bonds.
ARTICLE 10. Validity [13161. - 13166.]
Prior to the issue of any bonds to be issued pursuant to this chapter, the board, after satisfying itself respecting the relevant facts, shall, by resolution, find and determine—
The amount of earned surplus derived from the operation of the electric system of the district to which the revenues out of which such bonds are to be payable pertain, as of the end of the last fiscal year which ended not less than four months prior to the making of such finding and determination, and that the ascertainment of such earned surplus has been in accordance with the then current accounting practice of the district; provided, however, that such finding and determination need not be made in the case of the authorization of refunding bonds, or in any case where the voters have assented to the issuance of bonds in excess of the limitation specified in this chapter.
The amount of bonds issued under this chapter which are outstanding at the time of the adoption of such resolution.
That the resolution or resolutions authorizing such issue of bonds in all respects conforms or conform with the provisions of this chapter.
That the indebtedness to be evidenced by such issue of bonds, together with all other indebtedness of the district, pertaining to the electric system for or on account of which such bonds are to be issued, is within every debt or other limit prescribed by the Constitution and statutes of the State of California.
That upon the issuance of such bonds any and all acts, conditions and things required to exist, to happen and to be performed, precedent to and in the issuance thereof, will exist, will have happened and will have been performed, in due time, form and manner, as required by the Constitution and statutes of the State of California.
The board may also, by resolution, find and determine any other facts relevant to the legality of the issue.
The board, by resolution adopted in connection with any issue of bonds pursuant to this chapter, may direct that there shall be included in each of the bonds of that issue a certification and recital that any and all acts, conditions and things required to exist, to happen and to be performed, precedent to and in the incurring of the indebtedness evidenced by that bond, and in the issuing of said bond, exist, have happened and have been performed in due time, form and manner, as required by the Constitution and statutes of the State of California, and that said bond, together with all other indebtedness of the district pertaining to the electric system for or on account of which the indebtedness evidenced by said bond was incurred, is within every debt and other limit prescribed by the Constitution and statutes of the State of California.
From and after the issuance of any issue of bonds the findings and determinations of the board respecting that issue made pursuant to this article shall be conclusive evidence of the existence of the facts so found and determined in any action or proceeding in any court in which the validity of such bonds is at issue, and no bona fide purchaser of any such bond containing the certification and recital permitted by this article shall be required to see to the existence of any fact, or to the performance of any condition, or the taking of any proceeding, required prior to such issue, or to the application of the purchase price paid for such bonds.
Bonds shall be deemed to be issued, within the meaning of this article whenever the definitive bonds, or any temporary bonds or interim receipts exchangeable therefor, have been delivered to the purchasers thereof, and the purchase price thereof received, or in the case of bonds to be refunded through exchange, whenever such exchange has been made.
The validity of bonds reciting that they have been issued pursuant to this chapter shall not be affected by any provision or limitation contained in any other section or sections of this division. All bonds issued under this chapter shall be incontestable from and after the time of payment to the district of the purchase price thereof.
ARTICLE 11. Proceeds [13171. - 13177.]
All sums received as accrued interest on the sale of any issue of bonds issued pursuant to this chapter shall be applied to the payment of interest on or principal of bonds of that issue.
All sums received as principal and premiums on the sale of any issue of bonds shall be applied to the purposes for which such bonds were issued. The board may provide in the resolution authorizing the issue of any bonds under this chapter that any portion of the proceeds of sale of the bonds may be applied to payment of interest during construction for a period of not to exceed three years from and after the date of such bonds.
The board may from time to time establish and maintain a separate fund or funds in the district treasury for the purpose of insuring the application of such proceeds received as principal on the sale of any issue of bonds to the purposes for which the same were issued.
Money set aside and placed in any such separate fund shall remain therein until from time to time expended for the purposes for which such bonds were issued, including the reimbursement of other funds of the district for expenditures therefrom for purposes for which such bonds were issued, made after the adoption by the board of the preliminary resolution of intention provided for in Section 13101, and shall not be used for any other purpose whatsoever, except for temporary investment thereof as provided in this division; provided, however, that money may be paid or transferred from any such separate fund, in furtherance of the purpose of its establishment, to any other such separate fund established for a like purpose in connection with the same issue of bonds.
Money in any such separate fund shall be drawn therefrom only upon demands authenticated by the signature of the accountant of the district.
If the board shall determine by resolution that the expenditure of the whole or any portion of the said principal sum of any issue of bonds for the purpose for which such bonds were issued is impracticable or unwise, the board may—
Apply such money or any part thereof to the purchase of bonds of that issue, or to the payment of any such bonds, at maturity or on redemption, or to the payment of interest thereon or of premiums due on the redemption thereof; or
Apply such money or any part thereof to any new purpose which is within the purposes for which bonds might be issued under the terms of this chapter; provided, however, that before applying any of such money to such new purpose the board shall adopt a resolution specifying such new purpose, the amount of such money to be applied thereto, and authorizing such application, which resolution shall be subject to the same procedures, and take final effect only in the same manner, as if it were a resolution adopted pursuant to Section 13091, authorizing the issuance of bonds for such new purpose, and such resolution authorizing such application to such new purpose, when it shall have taken final effect under such procedures, shall be sufficient authority for the application of such money to such new purpose.
If any excess of the principal sum of the proceeds of any issue of bonds shall remain unexpended after the full accomplishment of the purpose for which such bonds were issued the board, by resolution, may direct that the same shall be applied to the purchase of bonds of that issue, or to the payment of any such bonds, at maturity or on redemption, or to the payment of interest thereon or of premiums due on the redemption thereof, or that it shall be transferred to the revenues pertaining to the electric system in connection with which such bonds were issued.
ARTICLE 12. Short Term Borrowing [13181. - 13184.]
A district may also have the power to borrow money from time to time for any or all of the purposes specified in this chapter, and to issue and sell notes, or other evidences, to evidence the indebtedness created by such borrowing, by resolution subject to referendum as provided in Section 13103, whenever they shall find and determine that the public interest and necessity require the exercise of that power.
All notes or other evidences of indebtedness issued under the authority of this article shall contain upon their face a recital that they are so issued and shall be payable in not to exceed three years from their date.
No amount shall be borrowed under the authority of this article which when added to the amount of all other notes or other evidences of indebtedness issued under this article and then outstanding shall exceed 50 percent of the gross operating revenues from the works on account of which it is borrowed during the preceding fiscal year.
All of the provisions of this chapter not inconsistent with the terms of this article, and not by their terms made inapplicable thereto, shall apply to all notes, or other evidences, issued under the authority of this article.
ARTICLE 13. Investments [13191. - 13193.]
Pending use for the purposes for which any reserve fund or special trust account or any other separate fund established pursuant to this chapter was so established, money set aside and placed therein may, when and to such extent and in such manner as may be directed by the said board and as may be consistent with the provisions of any resolutions of the board constituting a part of the proceedings for the issuance of the issue of bonds in connection with which such fund or account was created, be invested in the same manner as are other moneys of the district. Any such bonds or other evidences of indebtedness acquired through such investment may be resold at any time.
Any bonds or other securities so purchased shall constitute a part of such reserve fund, separate fund or special trust account, and any interest or any increment received by reason of such investment and the proceeds of any such resale shall be placed in, and constitute a part of, such fund or account.
Bonds issued under this chapter may be presented to the State Treasurer for certification under Division 10 of the Water Code in like manner and with the same legal effect as in the case of revenue bonds issued by irrigation districts; provided, that Section 20050 of the Water Code shall not be applicable to such bonds and, notwithstanding such certification, any district may issue subsequent series or issues of bonds without certification as the district may elect.
CHAPTER 7. Bonds [13201. - 13341.]
ARTICLE 1. Issuance [13201. - 13212.]
A district may from time to time incur a bonded indebtedness as provided in this chapter to pay the cost of acquiring, constructing, or completing the whole or any portion of any utility or works referred to in this division, or for acquiring any works, lands, structures, rights, or other property necessary or convenient to carry out the objects, purposes, or powers of the district.
Whenever the board by resolution passed by vote of two-thirds of all its members determines that the public interest or necessity demands the acquisition, construction, or completion by the district of any public utility or utilities referred to in this division or any works, lands, structures, rights, or other property necessary or convenient to carry out the objects, purposes, or powers of the district, the cost of which will be too great to be paid out of the ordinary annual income and revenue of the district, it may at any subsequent meeting of the board provide for the submission of the proposition of incurring a bonded indebtedness for the purpose set forth in the resolution to the voters of the district at a special bond election held for that purpose.
In lieu of a resolution passed by the board, proceedings for the issuance of bonds for the purposes provided in this chapter may be initiated by petition of the voters of the district.
Whenever any petition signed by voters within the district equal in number to at least 15 percent of the total vote cast is presented to the board asking for the acquisition, construction, or completion of the whole or any portion of any utility or works referred to in this division or for acquiring any works, lands, structures, rights, or other property necessary or convenient to carry out the objects, purposes, or powers of the district, and also asking that a bonded indebtedness be incurred to pay for the cost thereof, the secretary of the district shall immediately examine and verify the signatures of the petition and certify the result of the examination to the board.
If the required number of signatures is found to be genuine, the secretary shall transmit to the board an authentic copy of the petition without the signatures.
Upon receiving a petition with the certificate of the secretary stating that it contains the required number of signatures, the board shall formulate for submission to the voters of the district at a special bond election called for that purpose the proposition of incurring a bonded indebtedness for the purposes set forth in the petition. In its discretion the board may defer the calling of the election until the next general election to be held in the district in order to consolidate them.
The ordinance calling a special bond election shall fix the date on which the election will be held, and the manner of holding the election and of voting for or against incurring the indebtedness. It shall also recite the objects and purposes for which the indebtedness is proposed to be incurred, the estimated cost of the utility, works, lands, structures, rights, or other property proposed to be acquired, constructed, or completed, the amount of the principal of the indebtedness to be incurred therefor, and the maximum rate of interest to be paid on the indebtedness, which shall not exceed 8 percent per annum, payable semiannually. If, however, the rate of interest to be paid on the indebtedness does not exceed 412 percent per annum, payable semiannually, the rate of interest need not be recited in the ordinance.
Propositions for incurring indebtedness for more than one object or purpose may be submitted at the same election.
All special bond elections held in even-numbered years shall be consolidated with the direct primary or general election. All special bond elections held in odd-numbered years shall be held on the first Tuesday after the first Monday in November and may be held separately, or may be consolidated with any other election authorized by law at which the voters of the district may vote. When a special bond election is consolidated with a statewide primary or a general election, the board shall in the ordinance calling the special bond election consolidate it with the statewide primary or the general election to be held at the same time in the respective counties in which the district is located and authorize the respective boards of supervisors to canvass the returns and certify the result of the canvass to the board; it shall be the duty of the board or boards of supervisors to so consolidate the election, canvass the returns, and cause the result thereof to be properly certified to the board. If a special bond election is consolidated with any other election, the provisions of this chapter setting forth the procedure for the calling and holding of the special bond election shall be complied with, except that the ordinance calling the election need not set forth the election precincts, polling places, and officers of election, but may provide that the precincts, polling places, and officers of election shall be the same as those set forth in the ordinance, notice, or other proceedings calling the election with which the special bond election is consolidated, and shall refer to the ordinance, notice, or other proceedings by number and title, or by other definite description.
The ordinance shall be published, and no other notice of election need be given.
The votes of two-thirds of all the voters voting on the proposition at the election are required to authorize the issuance of bonds under this chapter.
If the proposition submitted at a special bond election fails to receive the requisite number of votes, the board shall not within six months after the election hold another special election for the submission of a proposition of incurring a bonded indebtedness substantially the same as the proposition voted upon at the prior election unless a petition signed by voters within the district equal in number to at least 15 percent of the total vote cast is filed with the board, requesting that the proposition, or a proposition substantially the same, be submitted at an election to be called for that purpose.
ARTICLE 2. Form and Content [13241. - 13244.]
Bonds authorized pursuant to this chapter shall mature serially in amounts to be fixed by the board; provided, that payment shall begin not more than 10 years from the date of issuance thereof and be completed in not more than 50 years from that date; provided, further, that the board may divide any issue of bonds authorized pursuant to this chapter into two or more series, and may fix different dates of issuance and different maturity dates for the bonds of each series. The bonds of each series shall mature serially in amounts to be fixed by the board, and the board shall fix a date not more than 10 years from the date of issuance of each series for the earliest maturity of such series, and shall fix a date not more than 50 years from the date of issuance of each series for the final maturity of such series.
The bonds shall be issued in such denomination or denominations as the board determines, and shall be payable on the day and at the place or places fixed in the bonds, and with interest at the rate specified therein, payable semiannually.
The board may at any time prior to the issuance and sale of any bonds provide for the call and redemption of any or all of the bonds on any interest payment date prior to their fixed maturity at not exceeding the par value and accrued interest plus a premium of not exceeding 5 percent upon the principal amount of the bonds, in which event the call price fixed by the board shall be set forth on the face of the bond. Notice of such redemption shall be published once a week for three successive weeks in a newspaper of general circulation printed and published within the district or if there is no such newspaper printed and published within the district then the publication shall be made in a newspaper of general circulation printed and published within the county in which the district or any part thereof is situated, the first publication of which shall be at least 30 days prior to the date fixed for the redemption. After the date fixed for such redemption interest on the bonds thereafter shall cease.
The bonds shall be signed by the president of the board or by such officer of the district as the board shall by resolution authorize and designate for that purpose. They shall also be signed by the treasurer, and be countersigned by the secretary. The coupons of the bonds shall be numbered consecutively and be signed by the treasurer. All signatures and countersignatures, except that of the treasurer on the bonds, may be printed, lithographed, or engraved. If any officer whose signature or countersignature appears on the bonds or coupons ceases to be such officer before the delivery of the bonds to the purchaser, the signature or countersignature is nevertheless valid and sufficient for all purposes as if he had remained in office until the delivery of the bonds.
ARTICLE 3. Issue and Sale [13261. - 13263.]
The bonds may be issued and sold for not less than their par value, but otherwise as the board determines.
The proceeds of the bonds shall be placed in the district treasury to the credit of the proper fund, and shall be used exclusively for the objects or purposes for which the bonds were voted.
In lieu of the immediate levy of a tax to pay the interest or any part thereof on any bonded indebtedness incurred in accordance with this division, the board may in the estimate of the amount of money necessary to be raised by the bonds include a sum sufficient to pay interest on all of the bonds or part thereof during the period of acquisition, construction, or completion, but for no period in excess of five years.
ARTICLE 4. Refunding [13281. - 13288.]
Whenever the board by resolution passed by a vote of two-thirds of all its members determines that the refunding of the whole or any portion of the bonded indebtedness will be of advantage to the district the board may refund the bonded indebtedness or any portion thereof and issue refunding bonds of the district therefor.
The issuance of refunding bonds shall not be construed as the incurring or increase of an indebtedness within the meaning of this division, and the approval of the voters is not required for the issuance of refunding bonds. The board may provide for the call and redemption of any or all of the bonds on any interest payment date prior to their fixed maturity in the ordinance authorizing the issuance of the refunding bonds.
Only the property in a special district is taxable for the payment of the principal and interest on any refunding bonds which are issued for the purpose of refunding any indebtedness of a special district.
Except as provided in this article, matters pertaining to the issuance of refunding bonds under this chapter shall be governed by Article 9 (commencing with Section 53550) and Article 10 (commencing with Section 53570), Chapter 3, Part 1, Division 2, Title 5 of the Government Code.
The proceeds of the sale of refunding bonds shall be applied only to the purchase, or retirement at not more than par and accrued interest, or the call price, of the bonded indebtedness for which the refunding bonds were issued.
In lieu of selling refunding bonds and using the proceeds to purchase or retire the bonds to be refunded, the board may exchange refunding bonds at not less than par and accrued interest for the bonds so refunded.
Whenever outstanding bonds are refunded they shall be surrendered to the treasurer of the district, who shall cancel them by endorsing on their face the manner in which the refunding was effected (whether by exchange or purchase, and the amount for which so purchased, if any) and by perforating through each bond and each coupon attached thereto the word “canceled” together with the date of cancellation.
ARTICLE 5. Status as Investments [13311. - 13312.]
All bonds including refunding bonds issued by a district are legal investments for all trust funds and for the funds of all insurance companies, banks, both commercial and savings, and trust companies, and for the State School Fund, and for all sinking funds under the control of the State Treasurer. Whenever any money or funds may by law be invested in or loaned upon the security of bonds of cities, cities and counties, counties, or school districts, in the State, such money or funds may be invested in or loaned upon the security of the bonds of a district; and whenever bonds of cities, cities and counties, counties, or school districts by law may be used as security for the faithful performance or execution of any court or private trust or of any other act, bonds of the district may be so used.
All bonds of the district, to the same extent as bonds of any other municipality, are legal for use by any state or national bank or banks in the State as security for the deposit of funds of the State or of any county, city and county, city, municipality, or other public or municipal corporation within the State.
ARTICLE 6. Validating Proceedings [13341. - 13341.]
An action to determine the validity of bonds may be brought pursuant to Chapter 9 (commencing with Section 860) of Title 10 of Part 2 of the Code of Civil Procedure.
CHAPTER 7.1. Emergency Financing [13345. - 13347.]
ARTICLE 1. Incurring Indebtedness for Repair or Replacement of Damaged or Demolished Works [13345. - 13347.]
Whenever the board, by resolution adopted by a four-fifths vote of all members of the board of a five-ward district, or by a five-sevenths vote of all members of the board of a seven-ward district, finds and determines that any part of the works of the district has been damaged or demolished by reason of fire, flood, earthquake, sabotage, or act of God or the public enemy, and that the cost of repairing or replacing the works so damaged or demolished is too great to be paid out of the ordinary annual income and revenue of the district, and that the public interest requires the incurring of indebtedness for the purposes set forth in the resolution, the board may authorize the incurring of indebtedness for this purpose pursuant to this chapter.
Whenever the board makes the finding and determination as described in Section 13345, the district may borrow money and incur indebtedness by the issuance of bonds, notes, or other securities as provided in this chapter by action of the board and without the necessity of calling and holding an election in the district. These evidences of indebtedness shall constitute general obligations of the district or shall be payable solely from revenues of the district as the board may determine in the resolution authorizing their issuance. The indebtedness may be incurred for any purpose for which the district is authorized to expend funds.
The indebtedness incurred under this chapter shall be evidenced by bonds, notes, or other evidences of indebtedness maturing in not to exceed five years from their date, shall bear interest at the rate or rates fixed by the board, and may be issued and sold at a public or private sale as the board may direct. All other terms and conditions of these evidences of indebtedness shall be fixed by the board. The maximum principal amount of all general obligation indebtedness outstanding under this chapter shall not, at any one time, exceed 1 percent of the assessed valuation of the property within the district taxable for district purposes.
The board may authorize and issue refunding notes for the purpose of paying and redeeming at or before maturity any notes previously issued and then outstanding. However, these refunding notes shall not be in excess of the limitation of indebtedness provided in this section and shall mature in not to exceed five years from the dates of the original indebtedness. Refunding notes may in turn be refunded under similar terms and conditions, except that no refunding note shall mature in excess of five years from the date of the original indebtedness.
Indebtedness incurred pursuant to this chapter shall be payable from any sources of available funds, including revenues, taxes, or state or federal grants. The board may levy and collect taxes upon all property in the district subject to taxation by the district without limitation of rate or amount for the payment of any evidences of general obligation indebtedness incurred pursuant to this chapter and the interest thereon. These taxes shall be in addition to all other taxes levied for district purposes and shall be levied at the same time and in the same manner as other district taxes are levied and, when collected, shall be deposited in a special fund and shall be used only for the payment of the principal of and interest on this indebtedness. The board shall apply for any federal or state funds available for purposes of repairing or replacing works damaged or demolished by reason of fire, flood, earthquake, sabotage, or act of God or the public enemy.
CHAPTER 7.5. Short-Term Borrowing [13371. - 13392.]
ARTICLE 1. Proceedings for Incurring Short-Term Indebtedness [13371. - 13379.]
A district may borrow money and incur indebtedness for the purposes of this chapter by the issuance of bonds, notes or other evidences of indebtedness by a majority vote of its board of directors and without the necessity of calling and holding an election in the district. Such evidences of indebtedness shall constitute general obligations of the district or shall be payable solely from the revenues of the district as the board may determine in the resolution authorizing their issuance; provided, that if the board determines that the evidences of indebtedness shall constitute general obligations of the district, their issuance shall be approved by a four-fifths vote of the board. Such indebtedness may be incurred for any of the following purposes:
The purchase, processing, storage, and disposal of fuel to be used for the generation and transmission of electricity, of materials to be used in the manufacture of such fuel, and of the products of such fuel, the purchase of real property and manufacturing and processing facilities from which such fuel or materials may be obtained, or interests therein.
The planning, design, engineering, and licensing of facilities for the generation or transmission of electricity, and the preparation of sites and the purchase of equipment for such facilities.
The planning, design, engineering, acquisition, or construction of facilities for the storage, transmission, or distribution of water.
The planning, design, engineering, acquisition, or construction of facilities for the storage, transmission, or treatment of sewage or byproducts of sewage treatment.
The replacement of works of the district that have been damaged or demolished by reason of fire, flood, earthquake, sabotage, or acts of God or the public enemy.
Any expenses or charges incurred in connecton with the foregoing purposes, and to reimburse the district for expenditures incurred for any of such purposes.
The indebtedness incurred under this chapter shall be evidenced by bonds, notes or other evidences of indebtedness maturing in not to exceed seven years from their date, shall not result in interest costs exceeding such limits as may be fixed by the board, and may be sold either by public or by private sale. All other terms and conditions of such evidences of indebtedness shall be fixed by the board. The district may arrange for bank credit for the purposes of this section or to provide an additional source of repayment for indebtedness incurred under this chapter. The maximum principal amount of all indebtedness outstanding under this article, including the amounts drawn on available bank lines of credit, shall not at any one time exceed the lesser of either (1) the annual average of the total revenue for the three preceding years or (2) 25 percent of the district’s total outstanding bonds issued pursuant to Chapter 6 (commencing with Section 12701), Chapter 7 (commencing with Section 13201), and Chapter 8 (commencing with Section 13451).
The authority contained in this chapter shall be in addition to the authority contained in Chapter 6 (commencing with Section 12701), Chapter 7 (commencing with Section 13201), and Chapter 8 (commencing with Section 13451), and any indebtedness incurred pursuant to this chapter shall not be included in ascertaining the aggregate indebtedness permitted by Section 12842.
The district may issue refunding bonds, notes, or other evidences of indebtedness for the purpose of paying and redeeming at or before maturity any bonds, notes, or other evidences of indebtedness issued under this chapter, provided that such refunding bonds, notes, or other evidences of indebtedness shall not be in excess of the limitation of indebtedness authorized under this chapter and shall mature in not to exceed seven years from the date of the original indebtedness. Such refunding bonds, notes, or other evidences of indebtedness may in turn be refunded under like terms and conditions, provided that in no event shall such refunding notes mature in excess of seven years from the date of the original indebtedness.
General obligation indebtedness issued pursuant to this chapter shall be payable from any sources of available funds, including revenues or taxes. The board is hereby authorized to levy and collect taxes upon all property in the district subject to taxation by the district without limitation of rate or amount for the payment of the evidences of such general obligation indebtedness and the interest thereon. Such taxes shall be in addition to all other taxes levied for district purposes and shall be levied at the same time and in the same manner as other district taxes are levied and when collected shall be deposited in a special fund and shall be used for no purpose other than the payment of the principal of and interest on such general obligation indebtedness.
This chapter applies only to districts which have owned and operated an electric distribution system or electric generating facilities or a water distribution or sewage disposal system for at least eight years and which contain a population of 250,000 or more.
As used in this chapter, the term “revenues of the district” shall have the same meaning as is provided in Section 54315 of the Government Code.
When bonds are issued under this article, the preliminary resolution of the board adopted pursuant to this article shall take effect upon its adoption by the board subject to the right of referendum provided for in this article. Successive issues of bonds may be authorized under this article from time to time and the authority herein contained shall not be limited to any particular issue.
Whenever a resolution authorizes the issuance of bonds pursuant to Section 13371, the board shall cause the resolution to be published in the manner provided for the publication of notices. At any time within 60 days after the date of the second such publication a referendum petition, signed by voters in number equal to at least 3 percent of the total vote cast, as defined in Section 11507, demanding the submission of such resolution to a vote of the voters of the district for their assent to the issuance of the proposed bonds, may be filed with the secretary. Upon presentation to the secretary of a petition meeting the requirements of this section, the resolution which is the subject thereof shall be of no effect unless and until it has been approved by the voters.
If no such referendum petition is presented within the period of 60 days, then upon the expiration of such period, or if the proposition of issuing the bonds specified in the resolution of the board adopted pursuant to this article has been assented to by a majority of the voters voting on the proposition, whether upon referendum or pursuant to Section 13379, then upon such proposition having been so assented to, the resolution shall take full and final effect, and the board may proceed in accordance with the provisions of this article and issue bonds within the terms of the resolution.
The board at any time may, and upon the filing of a referendum petition as provided in Section 13377 shall, adopt a resolution calling a special election for the purpose of submitting to the voters of the district the proposition of issuing revenue bonds in conformity with the preliminary resolution adopted pursuant to this article. The resolution calling the election shall fix the date on which the election is to be held, the proposition to be submitted thereat, the manner of holding the election and of voting for or against the proposition, and shall state that in all other particulars the election shall be held and the votes canvassed as provided by law for the holding of elections within the district. Such election may be held separately or may be consolidated with any other election authorized by law at which the voters of the district may vote. The resolution calling the election shall be published and no other notice of the election need be given. The votes of a majority of all the voters voting on the proposition at the election are required to authorize the issuance of bonds pursuant to Section 13371.
ARTICLE 2. Borrowing to Purchase Electricity [13391. - 13392.]
A district may borrow money and incur indebtedness for the purchasing of electricity; provided, that the maximum principal amount of indebtedness outstanding under this article shall not at any one time exceed twenty-five million dollars ($25,000,000).
All provisions of this chapter not inconsistent with this article and not by their terms made inapplicable thereto shall apply to all evidences of indebtedness issued under this article.
CHAPTER 8. Special District for Sewage Disposal or Solid Waste Resource Recovery [13451. - 13691.]
ARTICLE 1. Proposal of Formation [13451. - 13456.]
One or more special districts for sewage disposal or solid waste resource recovery purposes may be created within the boundaries of a district as provided in this chapter.
Resolutions shall first be passed by the legislative bodies of half or more, but of not less than two, of the public agencies, all or any part of the area of which it is intended to include in the proposed special district, declaring that the public interest or necessity demands the creation of a special district for sewage disposal or solid waste resource recovery purposes and describing its boundaries. The boundaries of the proposed special district may include territory outside any such public agency if the territory is within the area of the municipal utility district. When the entire area of any public agency is to be included in the special district it may be described in the resolutions by name. Certified copies of the resolutions shall be filed with the secretary of the district.
Instead of procedure by resolutions, a petition may be filed with the secretary of a district signed by voters within the proposed special district equal in number to at least 10 percent of the total vote cast. The boundaries of the proposed special district shall be described in the petition and shall include at least two public agencies or portions thereof. A statement of the name of any public agency constitutes a sufficient and legal description of the territory thereof if the entire area of the agency is included.
The petition shall declare that the public interest or necessity demands the creation of a special district for sewage disposal or solid waste resource recovery purposes within the area of the district described in the petition. The petition may be on separate papers, but each paper shall contain the affidavit of the party who circulated it, certifying that each name signed thereto is the true signature of the person whose name it purports to be.
The secretary of the district shall compare the signatures with the affidavits of registration and shall certify to the sufficiency or insufficiency of the petition.
The board may initiate proceedings for the creation of a special district for sewage disposal or solid waste resource recovery purposes within the area of the district by passing a resolution declaring that the public interest or necessity demands the creation of a special district for sewage disposal or solid waste resource recovery purposes, and describing its boundaries, which shall include all or any part of two or more public agencies. A public agency to be included may be described by name. No certified copy of the resolution need be filed with the secretary of the district.
ARTICLE 2. Hearing [13481. - 13488.]
Within 60 days after receipt of the resolutions of the public agencies or receipt of the certification of the sufficiency of a petition by the secretary of the district, or the passage of the resolution of the board, the board shall, by resolution, designate the special district as “____ (here insert name) Municipal Utility District, Special District No. ____ (here insert number)” (all such special districts shall be numbered consecutively) and shall fix a time and place for a hearing on the proposed creation of the special district for sewage disposal or solid waste resource recovery purposes and shall publish notice thereof.
The notice of hearing shall be published once in a newspaper of general circulation published in the district.
The time fixed for the hearing shall be not less than 30 nor more than 60 days from the date of the first publication of the notice.
At or before the hearing, any person interested may file with the secretary of the district written objections to the creation of the special district or to the inclusion of his property therein. Upon the hearing the board shall hear and determine all protests and objections. The hearing may be adjourned from time to time by the board without further notice other than an order to be entered upon the minutes of its meeting fixing the time and place of the adjournment.
The board may reduce or enlarge the boundaries of the proposed special district, but the boundaries as enlarged shall be within the district.
The board shall not approve the creation of a special district containing territory in addition to the territory included in the resolutions or petitions filed with the secretary of the district, or in its own resolution, until notice of its intention to include such additional territory has been published for the time and in the manner prescribed for the original hearing on the matter and a hearing is had pursuant to the notice.
No public agency or portion thereof shall be included within the boundaries of a special district unless its legislative body consents by resolution, or unless the proceedings for the creation of the special district have been initiated by petition of the voters.
If no protests are filed, or if the protests filed are overruled and denied by the board, the board shall thereupon by resolution approve the creation of the special district either as originally described or as revised by the board.
ARTICLE 3. Election [13511. - 13513.]
At any time after the board has approved the creation of the proposed special district, and fixed its boundaries, the board shall call and publish notice of an election within the proposed special district for the purpose of determining whether the proposed special district will be created and, if the board so determines, for the submission of a proposition for incurring a bonded indebtedness for the acquisition, construction, or completion by the district of any works, lands, structures, rights, or any other property necessary or convenient for the recovery of resources from solid waste or for the collection, treatment, or disposition of sewage matter for the special district. If the board determines that no bonded indebtedness is presently necessary, the board may call the election for the creation and establishment of the special district only, and a bond election may later be called.
No person is entitled to vote at the election unless he is a voter of the territory included in the proposed special district. The election may be held on the same day as any other state, county, or city election and may be consolidated therewith.
If a proposition for incurring a bonded indebtedness is submitted at the same election with the proposal to create the special district, the votes cast on the proposition of incurring a bonded indebtedness shall be separately canvassed in the special district as a whole. The favorable vote of two-thirds of all the voters voting on the proposition of issuing bonds within the special district as finally established is required to authorize the issuance of the bonds.
ARTICLE 4. Establishment [13531. - 13532.]
On the question of the creation of a special district, the returns of each public agency and of each parcel of unincorporated territory shall be canvassed separately, and the board shall order and declare the special district created and established if in each public agency and if in each parcel of unincorporated territory a majority of those who voted on the proposition of creating the special district voted in favor thereof.
A special district has no separate corporate existence but shall be deemed to be a taxing subdivision of the district.
ARTICLE 5. Powers and Functions [13561. - 13565.]
Connections of all sewers within the special district to intercepting sewers of the district shall be made at such points and in such manner and under such rules, regulations, terms, charges, and conditions as the board may prescribe.
Nothing in this division shall require the district to construct any sewers other than intercepting and outfall sewers. The determination by the board of what are intercepting and outfall sewers within the meaning of this division is final and conclusive.
Upon completion of sewage disposal facilities for any special district all sewage and industrial waste originating within the special district shall be disposed of through the sewage disposal facilities of the district.
Without limiting in any way the foregoing provisions of this division, the respective public agencies within the district and the district may contract regarding the collection, treatment, or disposition of sewage.
Each utility which a district is authorized to acquire, construct, own, operate, control, or use pursuant to this division shall be considered to be a utility owned and operated by the district even though service therefrom is limited to a special district created as provided in this division.
ARTICLE 5.5. Waste Water Control [13570. - 13578.]
The board shall supervise and regulate sewage disposal within a special district, including the fixing of standards, contracts, issuance of licenses or permits, practices and schedules for or in connection with waste water control and sewage disposal functions of such special district.
Without limiting in any way the provisions of this division, and in addition to the powers granted therein, the board may make and enforce such regulations for the control of quantity, quality and flow of waste water within the boundaries of a special district as are not in conflict with the general laws of the state. “Waste water” shall include all sewage, industrial and other wastes and waters, whether treated or untreated, discharged into or permitted to enter a community sewer system connected to or directly into a district interceptor for treatment in sewage disposal facilities of a special district.
Rules and regulations pertaining to the control of quantity, quality or flow of waste water may provide for any or all of the following:
Periodic technical reports to the district from contributors or dischargers into the district’s system.
The issuance of permits or licenses by the district as a condition of discharging waste water for treatment in sewage disposal facilities of a special district.
The installation by the contributor or discharger of pretreatment works or facilities.
The installation by the contributor or discharger of waste water sampling and inspection facilities.
Procedures for enforcement of waste water standards and regulations adopted by the district and remedies for violation thereof.
Entry by the district upon private property to make surveys, inspections or samplings.
Such other provisions as are necessary to effectuate the control of the quantity, quality and flow of waste water within a special district.
No person shall discharge waste water into a community sewer system connected to or directly into a district interceptor which will result in contamination, pollution or a nuisance. All discharges of waste water which are, or could be, harmful to or unreasonably affect the sewage disposal facilities of a district, or which impair or unreasonably affect the operation and maintenance of such facilities, or which violate quantity, quality and flow standards adopted by the district, and all waste water discharges which unreasonably affect, or could unreasonably affect, the quality of the district’s treatment plant effluent in such a manner that receiving water quality requirements established by law cannot be met by the district, shall constitute a nuisance for the purposes of this article.
Whenever a discharge of waste water is in violation of the district’s regulations or otherwise causes or threatens to cause a condition of contamination, pollution or nuisance, as defined in this article, the district may petition the superior court for the issuance of a preliminary or permanent injunction, or both, as may be appropriate, restraining the continuance of such discharge. In any civil action brought under this section, it shall not be necessary to allege or prove at any stage of the proceedings that irreparable damage will occur should the temporary restraining order, preliminary injunction or permanent injunction not be issued or that the remedy at law is inadequate and the temporary restraining order, preliminary injunction or permanent injunction shall issue without such allegations and without such proof.
Any person who fails to comply with any order issued by the district, shall be subject to a civil penalty not to exceed ten thousand dollars ($10,000) for each day in which the discharge, violation, or refusal occurs.
Any person who intentionally or negligently violates any order issued by the district for violation of rules regulating or prohibiting discharge of waste water which causes or threatens to cause a condition of contamination, pollution or nuisance, as defined in this article, may be liable civilly in a sum not to exceed twenty-five thousand dollars ($25,000) for each day in which the violation occurs.
The attorney of the district, upon request of the board, shall petition the superior court to impose, assess and recover the sums provided for in subdivisions (a) and (b). In determining the amount of the fine the court shall take into consideration all relevant circumstances, including, but not limited to, the extent of harm caused by the violation, the nature and persistence of the violation, the length of time over which the violation occurs and corrective action, if any, attempted or taken by the discharger.
Notwithstanding any other provision of law, all civil fines imposed by the court for a violation of this section shall be distributed as follows:
Fifty percent shall be transferred into the general fund of the county in which the action to recover the fine was brought.
Fifty percent shall be transferred once a month to the treasurer of any municipal utility district in the county for deposit in the funds of the district.
Remedies under this section are in addition to and do not supersede or limit any and all other remedies, civil or criminal, but no liability shall be recoverable under this section for any violation for which liability is recovered under Section 13575.5.
The district may issue a complaint to any person on whom civil liability may be imposed pursuant to this article. The complaint shall allege the act or failure to act that constitutes a violation of law, the provision of law authorizing civil liability to be imposed pursuant to this article, and the proposed civil liability.
The complaint shall be served by personal notice or certified mail on the person subject to the district’s discharge and reporting requirements, and shall inform the party served that a hearing shall be conducted within 60 days after the party has been served. The hearing shall be before a hearing officer designated by the board. The person who has been issued a complaint may waive the right to a hearing, in which case the district shall not conduct a hearing. A person dissatisfied with the decision of the hearing officer may appeal to the board of directors within 30 days of notice of the hearing officer’s decision.
If after the hearing, or appeal, if any, it is found that the person has violated reporting or discharge requirements, the hearing officer or board may assess a fine against that person. In determining the amount of the fine the hearing officer or board shall take into consideration all relevant circumstances, including, but not limited to, the extent of harm caused by the violation, the nature and persistence of the violation, the length of time over which the violation occurs and corrective action, if any, attempted or taken by the discharger.
Civil liability may be imposed by the district as follows:
In an amount which does not exceed one thousand dollars ($1,000) for each day for knowingly or willfully failing or refusing to furnish technical or monitoring reports.
In an amount which does not exceed five thousand dollars ($5,000) for each day of intentionally or negligently discharging hazardous waste, as defined in Section 25117 of the Health and Safety Code, knowingly falsifying any information provided in any furnished technical or monitoring report.
In an amount which does not exceed ten dollars ($10) per gallon for discharges in violation of any of the district’s cease and desist or other orders, or prohibitions issued, reissued, or adopted by the district.
All moneys collected under this section shall be deposited in a special district account and shall be made available for the monitoring, treatment, and control of discharges into district facilities.
Unless appealed, orders setting administrative civil liability shall become effective and final upon issuance thereof, and payment shall be made within 30 days. Copies of these orders shall be served by personal service or by registered mail upon the party served with the complaint and upon other persons who appeared at the hearing and requested a copy.
No liability shall be recoverable under this section for any violation for which liability is recovered under Section 13575.
Any party aggrieved by a final order issued by the board under Section 13575.5, after granting review of a hearing officer order, may obtain review of the order of the board in the superior court by filing in the court a petition for writ of mandate within 30 days following the issuance of the order by the board. Any party aggrieved by a final order of a hearing officer issued under Section 13575.5 for which the board denies review may obtain review of the order of the hearing officer in the superior court by filing in the court a petition of writ of mandate within 30 days following the denial of review by the board.
If no aggrieved party petitions for writ of mandate within the time provided by this section, an order of the board or a hearing officer shall not be subject to review by any court or agency, except that the board may grant review on its own motion of an order issued under Section 13575.5 after the expiration of the time limits set by that section.
Within 30 days after service of a copy of a decision and order issued by the board pursuant to Section 13575.5, any aggrieved party may file with the superior court a petition for writ of mandate for review thereof. Failure to file a petition shall not preclude a party from challenging the reasonableness and validity of a decision or order of a hearing officer or the board in any judicial proceedings brought to enforce that decision or order or for other civil remedies.
The evidence before the court shall consist of the record before the board, including the hearing officer’s record, and any other relevant evidence which, in the judgment of the court, should be considered to effectuate and implement the policies of this division. In every such case, the court shall exercise its independent judgment on the evidence.
Except as otherwise provided in this section, subdivisions (e) and (f) of Section 1094.5 of the Code of Civil Procedure shall govern proceedings pursuant to this section.
Any person who intentionally discharges waste water in any manner, in violation of any order issued by the district, which results in contamination, pollution or a nuisance, as defined in this article, is guilty of a misdemeanor.
Any person who knowingly makes any false statement or representation in any record, report, plan, or other document filed with the district, or who falsifies, tampers with, or knowingly renders inaccurate any monitoring device or method required by the district, shall be punished by a fine of not more than twenty-five thousand dollars ($25,000) or by imprisonment in the county jail for not more than six months, or by both.
Any abatement actions taken pursuant to the foregoing sections with respect to contamination, pollution or nuisance, as defined in this article, created by the discharge of waste water into a community sewer system shall be taken against the agent or agency operating such system and the contributor or contributors whose waste creates the contamination, pollution or nuisance.
The district may enter upon private property of any person and sample at, inspect or survey the waste water sampling installation or pretreatment facilities or processes of any contributor or discharger to ascertain whether district regulations for control of quantity, quality and flow of waste water are being complied with. Such inspections shall be made with the consent of the owner or possessor of such facilities or, if such consent is refused, with a warrant duly issued pursuant to the procedure set forth in Title 13 (commencing with Section 1822.50) of Part 3 of the Code of Civil Procedure. However, in the event of an emergency affecting the public health or safety, such inspection may be made without the consent or the issuance of a warrant. The district may terminate or cause to be terminated sewage disposal or water services to such property if a violation of any rule or regulation pertaining to control of waste water is found to exist or if a discharge of waste water causes or threatens to cause a condition of contamination, pollution or nuisance, as defined in this article.
ARTICLE 6. Financing [13591. - 13593.]
The board may use temporarily any district funds for the payment of any costs or expenses incident to the proposed or actual creation of a special district for sewage disposal or solid waste resource recovery purposes or the acquisition, construction, or completion of any works, lands, structures, rights, or other property necessary or convenient for the recovery of resources from solid waste or for the collection, treatment, or disposition of sewage matter for the special district or incident to the operation or maintenance of the special district.
The board shall recover all district funds advanced under this article by means of taxes levied upon all property within the special district or from any appropriate funds or revenues of the special district; but nothing in this section shall compel reimbursement if the tax required therefor would amount to less than one mill ($0.001) on each one hundred dollars ($100) of assessed value of the property within the special district.
Nothing in this article limits the general powers of a district with reference to sewage disposal or solid waste resource recovery.
ARTICLE 7. Bonds [13621. - 13626.]
At any time after the creation of a special district a proposition of incurring bonded indebtedness for the acquisition, construction, or completion by the district of any works, lands, structures, rights, or any other property necessary or convenient for the recovery of resources from solid waste or for the collection, treatment, or disposition of sewage matter for the special district may be submitted.
Except as otherwise provided herein the provisions of Chapter 7 shall substantially govern as to all matters pertaining to the issuance of bonds under this article, including among other things, and without limiting the generality of the foregoing, the calling and holding of the bond election, the form, execution, issuance, maturity, redemption, refunding, validation, the payment of interest from bond funds and the status of the bonds as investments.
The favorable vote of two-thirds of all the voters within the special district voting on the proposition is required to authorize the issuance of the bonds.
Only the property in the special district shall be taxable for the payment of the principal and interest on special district bonds. Until the bonds are paid, taxes shall be levied in substantial compliance with Section 12893.
Any proceeding denying the validity of the creation of any special district, or of any bonds authorized by the voters thereof pursuant to this division, shall be brought within three months after the date upon which the applicable proposition is approved by the voters.
The board may utilize the provisions of Chapter 7.1 (commencing with Section 13345) to authorize emergency financing of the repair or replacement of damaged or demolished works of the special district; provided, that the payment of the principal and interest on such bonds or evidences of indebtedness shall be made only from revenues, taxes, or other available funds, of the special district.
ARTICLE 7.5. Short-Term Borrowing [13631. - 13633.]
The special district may borrow money and incur indebtedness in anticipation of the sale of bonds which have been authorized to be issued by the voters within the special district but which have not been sold and delivered, and it may issue bonds, notes, or other securities as provided in this article by action of the board and without the necessity of calling and holding an election. Such evidences of indebtedness shall constitute general obligations of the district. The indebtedness may be incurred for any of the purposes for which a bond issue had previously been approved by the voters, and to reimburse the district for expenditures incurred for any of such purposes. The indebtedness incurred under this article shall be evidenced by bonds, notes or other evidences of indebtedness maturing in not to exceed five years from their date, shall bear interest at such rate or rates as may be fixed by the board, and may be issued and sold at public sale as the board may direct. All other terms and conditions of such evidences of indebtedness shall be fixed by the board. The maximum principal amount of all indebtedness outstanding under this article shall not at any time exceed the aggregate amount of bonds which the district is then authorized to issue, less the amount of other securities then outstanding issued in anticipation of the sale of such an authorized issue.
The special district may issue refunding bonds, notes, or other securities for the purpose of paying and redeeming at or before maturity any bonds, notes or other securities issued under this article, provided that such refunding bonds, notes, or other securities shall not be in excess of the limitation of indebtedness authorized under this article and shall mature in not to exceed five years from their date.
Evidences of indebtedness issued pursuant to this article shall be payable from any sources of available funds of the special district, including revenues, taxes, or state or federal grants. If not previously otherwise paid the evidence of indebtedness shall be paid from the proceeds of the next sale of the bonds of the district in anticipation of which they were issued, and if not so paid, the board is hereby authorized to levy and collect taxes from all property in the special district subject to taxation by the district without limitation of rate or amount for the payment of such evidences of indebtedness. Such taxes shall be in addition to all other taxes levied for special district purposes and shall be levied at the same time and in the same manner as other district taxes are levied and when collected shall be deposited in a special fund and shall be used for no purpose other than the payment of the principal of, and interest on, such indebtedness.
ARTICLE 8. Annexation [13651. - 13661.]
Any public agency or portion thereof or unincorporated territory within the boundaries of a district (hereinafter referred to collectively as “territory”) not included within the boundaries of a special district may be annexed thereto in the manner provided in this article.
The board shall by resolution determine that the annexation of the territory will facilitate the acquisition or operation of a public utility for the special district, describe therein the territory, declare its intention to annex the territory to the special district, set forth the terms and conditions upon which the territory shall be annexed, fix the time and place for hearing on the question of the annexation, and provide for the giving of notice of the hearing.
No public agency or portion thereof shall be annexed to a special district unless the legislative body thereof shall by resolution consent.
The terms and conditions for the annexation of territory to a special district may provide, among other things, for the payment of taxes within the territory to be annexed in addition to the taxes elsewhere in this division provided for, the fixing of rates, rentals, and charges differing from those fixed or existing elsewhere within the special district, the making of a payment or payments, or the transfer of property, real and personal, and other assets to the district by the territory proposed to be annexed.
Notice fixing the time and place for hearing on the question of the annexation of territory to a special district shall be published once in a newspaper of general circulation published in the district.
The time for hearing shall be not less than 30 nor more than 60 days from the date of the first publication of the notice.
At or before the hearing any person interested may file with the secretary of the district written objections to the annexation of the territory to the special district or to the inclusion of his property therein. Upon the hearing, the board shall hear and determine all protests and objections.
The hearing may be adjourned from time to time by the board without further notice other than an order entered upon the minutes of its meeting fixing the time and place of adjournment. In the event that no protests are filed or the protests filed are overruled and denied the board shall thereupon by resolution declare the territory, or a portion thereof, annexed to the special district.
From and after the date of filing of the resolution with the secretary of the district the annexation of the territory, or portion thereof, to the special district is complete.
No annexation to a special district shall operate to dissolve or terminate the legal existence of any public agency within or partly within the territory annexed.
From and after the date of annexation any territory annexed to a special district is liable for payment of its proportionate share of any indebtedness then existing and payable by the special district. From and after the date of annexation the board shall levy upon all of the property in the territory annexed such taxes, tolls, or charges as are necessary to comply with the terms and conditions of annexation, in addition to any other district taxes authorized elsewhere in this division to be levied and collected.
ARTICLE 9. Dissolution [13691. - 13691.]
A special district may be dissolved by resolution of the board if any proposition for the incurring of a bonded indebtedness fails to carry, and if the special district is then subject to no other indebtedness or liability pursuant to this division and has been organized for not less than two years. Such dissolution of the special district shall not prevent subsequent proceedings for the creation of a special district including the same or any part of the area of the special district dissolved.
CHAPTER 9. Annexation of Public Agencies [13801. - 13932.]
ARTICLE 1. Annexation Agreement [13801. - 13804.]
Any public agency not included within the boundaries of a district may be annexed to the district in the manner provided in this chapter or in the Cortese-Knox-Hertzberg Local Government Reorganization Act of 2000 (Division 3 (commencing with Section 56000) of the Government Code). When proceedings for an annexation are taken pursuant to this chapter, only the provisions of this chapter shall apply to that annexation.
The legislative body of the public agency proposed to be annexed shall agree in writing with the board upon the terms and conditions of annexation, which agreement (among other things) may provide for any of the terms and conditions authorized by the District Reorganization Act of 1965 (commencing at Section 56000, Government Code). The corporate boundaries of the public agency to be annexed need not be coterminous with any election precincts.
The terms and conditions of annexation may provide, among other things, for the levy and payment of taxes within the territory to be annexed in addition to the taxes authorized elsewhere in this division, for the fixing of rates, rentals, and charges differing from those fixed or existing elsewhere within the district, or for the making of one or more payments, or the transfer of real or personal property or other assets to the district by the public agency. Such payments may be either for the acquisition, transfer, use or right to use all or any part of the existing property of the district or for installation and construction of facilities and equipment required to serve the annexed territory.
After the legislative body of the public agency and the board have concurred upon the proposed terms and conditions, the secretary or clerk of the public agency to be annexed shall file a certified copy of the proposed agreement with the executive officer of the local agency formation commission.
After the filing of the proposed agreement with the executive officer, proceedings thereon shall be taken by the local agency formation commission in the manner and subject to the provisions of Part 4 (commencing at Section 56250, Government Code) of the District Reorganization Act of 1965. If the proposed annexation and agreement are approved by the commission, with or without amendment, wholly, partially or conditionally, it shall be mandatory for the board and the legislative body of the public agency to complete the proceedings for such annexation, subject to compliance with the commission’s resolution making determinations.
ARTICLE 2. Approval by District [13821. - 13827.]
The agreement shall become effective and be binding upon the district and the public agency when approved in the manner set forth in this chapter.
After receipt of the resolution of the local agency formation commission making determinations, the board shall by ordinance setting forth the agreement at length declare its intention of causing it to be executed by the district.
The ordinance, together with a notice fixing the time and place for hearing thereon, shall be published once in a newspaper of general circulation published in the district. The time fixed for the hearing shall be not less than 30 nor more than 60 days from the date of the first publication of the ordinance.
At the hearing any person interested may file with the board written objections to the execution of the agreement.
Upon the hearing the board shall determine whether or not the agreement will be carried into execution and shall hear and determine all objections thereto. Failure of any person interested in the district or in the matter of the proposed execution of the agreement to show cause in writing pursuant to Section 13823 constitutes an assent on his part to a change in the boundaries of the district and to the execution of the agreement.
Any hearing on the agreement may be adjourned from time to time by the board without further notice other than an order to be entered upon the minutes of the meeting fixing the time and place of adjournment.
If no protests are filed or if the protests filed are overruled and denied the board shall thereupon by resolution finally approve the agreement and authorize its execution, which shall become effective when executed by the public agency, duly authorized in the manner provided in this chapter.
When executed by the district the agreement shall be dated and an executed copy filed with the secretary of the district. An executed copy shall also be filed with the secretary or clerk of the public agency to be annexed.
ARTICLE 3. Approval by Public Agency [13851. - 13856.]
At any time after the board has finally approved the agreement of annexation the legislative body of the public agency to be annexed shall cause an election to be held in the public agency to determine whether the public agency will be annexed to the district upon the terms and conditions stated in the agreement.
Notice of election shall be published as provided in Section 11534 and shall either state that a copy of the annexation agreement is on file in the office of the secretary or clerk of the public agency proposed to be annexed, and open to the inspection of all persons interested, or set forth the terms and conditions of the agreement of annexation at length, in the discretion of the legislative body calling the election.
The ballots for the election shall contain substantially the instructions required to be printed on ballots for use at general state and county elections and in addition shall set forth the proposition of annexation substantially as follows:
If upon a canvass of the election it is found that a majority of all votes cast on the proposition at the election were cast in favor of the annexation, the proposition and all of the terms and conditions of the agreement of annexation shall be deemed carried and approved by the voters; except that if the terms and conditions of the agreement of annexation provide for the assumption of any indebtedness of the district by any city proposed to be annexed, the proposition of annexation shall not be deemed carried unless approved by the vote of two-thirds of all the voters voting on the proposition at the election.
If the proposition fails to carry, the result shall be entered upon the minutes of the governing body of the public agency.
If the proposition receives the vote of the requisite majority of voters the governing body of the public agency shall enter in its minutes an order declaring the result of the election and shall thereupon cause the agreement of annexation to be executed by its duly authorized officers.
ARTICLE 4. Establishment of Annexation [13886. - 13886.]
Upon receipt by the district of a copy of the agreement of annexation properly executed by the district and the public agency proposed to be annexed the board shall pass a resolution declaring the public agency annexed to the district. Thereupon the secretary of the district shall make the filings provided for in Chapter 8 (commencing at Section 56450, Government Code) of Part 5 of the District Reorganization Act of 1965. The annexation shall be complete and effective on the dates specified in said Chapter 8.
ARTICLE 5. Annexation of Territory Annexed to Public Agencies [13911. - 13912.]
Upon the completion of the annexation of any territory in accordance with law to any city included in the district the city clerk shall file with the secretary of the district a certified copy of the ordinance, resolution or other document completing said annexation, containing a description of the territory so annexed. Unless the district within 90 days after such filing shall file with the city clerk the district’s written objections to the annexation of said territory, or to a specified portion or portions thereof, to the district, said territory, or such portion or portions thereof to which the district does not object as aforesaid, shall upon the termination of said period be deemed incorporated into and annexed to the district, and thereafter is subject to taxation, along with the entire territory of the district in accordance with the assessable valuation of the property thereof, for general district purposes, and for the payment of any indebtedness theretofore or thereafter incurred by the district. Any such objection filed with the city clerk by the district as to a portion or portions of said territory shall describe such portion or portions.
If the district shall file its objections in the manner aforesaid to the annexation of said territory or any specified portion or portions thereof to the district, said territory, or the portion or portions thereof so objected to, shall not be annexed to the district except in the manner provided in the District Reorganization Act of 1965 (commencing at Section 56000, Government Code). Prior to the expiration of the 90 day period referred to in Section 13911, the district may from time to time withdraw such objections to the annexation of said territory or any specified portion or portions thereof by filing with the city clerk a certified copy of a resolution or resolutions of the board stating that such objections to the annexation of said territory or any specified portion or portions thereof are withdrawn. Thereupon said territory, or the portion or portions as to which such objections are so withdrawn, shall be deemed incorporated into and annexed to the district as provided in Section 13911. Any such resolution or resolutions filed with the city clerk withdrawing the district’s objections to the annexation of a portion or portions of said territory shall describe such portion or portions.
ARTICLE 6. Effect of Annexation [13931. - 13932.]
From and after the date of annexation the board shall levy upon all of the property in the public agency annexed such taxes, tolls, or charges as are necessary to provide funds for the payment of the indebtedness assumed by the public agency or otherwise necessary to comply with the terms and conditions of the annexation agreement, all in addition to the general district taxes authorized elsewhere in this division to be levied and collected.
No annexation of a public agency to a district shall operate to dissolve or terminate the legal existence of the public agency annexed.
CHAPTER 10. Annexation of Unincorporated Territory [14051. - 14052.]
Unincorporated territory may be annexed to a district in the manner provided in the Cortese-Knox-Hertzberg Local Government Reorganization Act of 2000 (Division 3 (commencing with Section 56000) of the Government Code).
Unincorporated territory not contiguous to a district may not be annexed if the district does not possess facilities for supplying utility service to that territory.
CHAPTER 11. Exclusion of Territory [14351. - 14384.]
ARTICLE 1. Exclusion of Unincorporated Territory [14351. - 14351.]
Any territory contained within a district not operating any utility and not included within the boundaries of any incorporated city and not benefited in any manner by the district or by its continued inclusion therein may be excluded therefrom by proceedings under and pursuant to the District Reorganization Act of 1965 (commencing at Section 56000, Government Code).
ARTICLE 2. Exclusion of Incorporated Territory [14381. - 14384.]
If the city to which any territory included in any district has been annexed already serves electricity or water to the territory annexed, the city council or other governing body of the city may propose an agreement for the exclusion of such territory from the district.
The agreement for exclusion shall be authorized and executed and proceedings for such exclusion taken in the same manner as provided in Chapter 9 (commencing at Section 13801) for the annexation of a public agency to a district.
If an order of exclusion is granted, the board and the governing body of the city shall by contract provide for the payment by the city of the proportion of the taxes and bonded indebtedness for which the territory excluded is justly liable. If they do not agree, either may petition the superior court in and for the county in which the property is located for a judgment declaring the proportion of the taxes and bonded indebtedness for which the territory excluded is justly liable. The proceeding shall be governed by the provisions of the Code of Civil Procedure relating to declaratory relief.
The order of exclusion does not invalidate in any manner any taxes or assessments theretofore levied or assessed against the lands excluded nor relieve the property excluded from any outstanding bonds which are a lien thereon at the time of exclusion, nor from any taxes to pay the principal or interest thereof.
CHAPTER 11.5. Hearings [14401. - 14403.5.]
Before any rates and charges for commodities or service furnished by a district are fixed or changed the general manager shall file with the board a report and recommendation thereon in writing. Within 40 days thereafter the board shall hold a public hearing on the report and recommendation. Prior to the hearing, notice of the time and place of hearing shall be published within the district pursuant to Section 6066 of the Government Code.
A district or any interested person may bring an action pursuant to Chapter 9 (commencing with Section 860) of Title 10 of Part 2 of the Code of Civil Procedure to determine the validity of district rates or charges.
Notwithstanding any other provision of law, any judicial action or proceeding to attack, review, set aside, void, or annul an ordinance, resolution, or motion fixing or changing rates or charges for the commodities or service furnished by a district shall be commenced within 120 days of the effective date of the ordinance, resolution, or motion.
Before the board adopts any change in rates and charges for commodities or services furnished by an electricity district intended to increase or decrease revenues, the general manager shall file with the board a report and recommendation on the proposed changes in writing. Within 90 days, but not less than 30 days after the report is filed, except when unanticipated events cause a sudden and significant change in the electricity district’s financial condition requiring an immediate response, the board shall hold a hearing on the report and recommendation. Notice of the time and place of the hearing shall be published within the district pursuant to Section 6063 of the Government Code, except that, in the case of an unanticipated event requiring an immediate response, notice may be given pursuant to Section 6063a of the Government Code.
The report and recommendation of the general manager of an electricity district filed pursuant to Section 14403 shall include all of the following:
The most recent annual report submitted pursuant to Section 11938.
A statement of sales volumes by customer types for the preceding two years and estimates of sales volumes for the two years following.
A statement of sources and disposition of funds for the preceding two years and estimates of sources and dispositions of funds for the two years following, whether or not the rate change does occur.
A statement of capital expenditures anticipated during the next two years following.
In sufficient detail to permit an assessment of the need for any proposed changes, a statement of each category of expense for the preceding two years, and estimates of each category of expense for the two years following.
Other information as the general manager believes will explain or justify the proposed rate change.
The basis for the allocation of the overall revenues among the various types of customers of the electricity district.
At the hearing held pursuant to Section 14403, the board shall do both of the following:
Permit any member of the public who has given 10 days advance written notice to present nonduplicative testimony on the proposed rate change or on any alternatives.
Consider any report and recommendations submitted in writing by any member of the public on alternatives to the rate changes proposed by the general manager.
DIVISION 7. PUBLIC UTILITY DISTRICT ACT [15501. - 18055.]
CHAPTER 1. General Provisions [15501. - 15533.]
ARTICLE 1. Definitions [15501. - 15507.]
This division may be cited as “The Public Utility District Act.”
Unless the context otherwise requires, the provisions of this article govern the construction of this division.
“District” means a public utility district formed pursuant to this division.
“Board” means the board of directors of a district.
“Elector,” “voter,” or “qualified elector,” means a voter whose name appears on the great register of the county in which the district is located, or any supplement thereto, allowed by law to be used to determine the eligibility of persons to vote at municipal or county elections, and whose address as it appears on the great register or supplement is in the same unincorporated territory as the address given by him on the certificate or petition that is signed by him.
“Original and primary proposition” means the proposition to incorporate the proposed district with all of the proposed territory joining in the proceedings and mentioned and described in the several petitions presented by the electors.
“Person” means an individual, a firm or a copartnership.
ARTICLE 2. General Provisions [15531. - 15533.]
The great register or supplement thereto, and certificates in due form of notaries public or verification deputies acknowledging the signature of any voter to any petition or certificate pursuant to this division, are sufficient evidence for all purposes of this division.
Nothing in this division shall be construed as repealing or modifying the provisions of any other law relating to public utility districts, except insofar as the provisions of such other law are inconsistent with the provisions of this division.
Whenever all the territory comprising a district becomes part of a city, the legislative body of the city succeeds to the powers of the board of directors of the district and is thereafter for all purposes the board of directors. All property, records, and documents of the district shall be transferred and conveyed by the board of directors to the legislative body of such city.
CHAPTER 2. Formation of Districts [15701. - 15846.]
ARTICLE 1. Petition for Formation [15701. - 15709.]
A district may be incorporated and managed in unincorporated territory pursuant to this division and may exercise the powers expressly granted.
Whenever the people of unincorporated territory desire to organize a district, they shall present to the board of supervisors of the county within which the territory is situated a petition describing the territory, and signed by registered voters of the territory equal in number to 15 percent of all votes cast for all candidates for Governor within the same territory at the last preceding general election at which a Governor was elected.
The petition may consist of any number of separate instruments, all of which shall constitute one petition. A separate petition is required from each unit of the proposed district. All unincorporated territory participating in the proceedings and situated in one county is a unit for purposes of the proceedings. No registered voter within any one unit of the proposed district shall sign a petition of any other unit of the proposed district.
Each petition shall name or describe the territory within which the registered voters signing it reside. Every petition shall set forth the boundaries and name of the proposed district, which shall include the words “public utility district.” Every petition shall contain a prayer that a public utility district comprising all of the proposed territory, or any portions thereof as are designated in the petitions as essential to its formation, be incorporated pursuant to this division. Every registered voter signing a petition shall write his or her address opposite his or her signature.
The county elections official shall within 30 days examine and verify the signatures to the petition and certify the result of the examination to the board of supervisors.
If the county elections official, by his or her certificate, finds that a petition is insufficient, he or she shall certify to the number of additional signatures of qualified electors required to make the petition sufficient, and the petition may be amended by a supplemental petition filed within 10 days from the date of the certificate. Within 10 days after a supplemental petition has been filed, the county elections official shall examine it and certify to the result of the examination. If this certificate shows the petition as amended to be insufficient, it shall be filed by the county elections official in his or her office and kept as a public record, without prejudice to the filing of any other petition to the same effect not less than six months thereafter. If the certificate shows the petition or petition as amended to be sufficient, the county elections official shall present it to the board of supervisors without delay with his or her certificate attached and properly dated.
If a supplemental petition is filed, all signatures appended to the petition and to the supplemental petition shall be considered in determining the number of qualified electors signing the petition.
After the election for the incorporation of the proposed district, the sufficiency of the petition in any respects shall not be subject to judicial review or otherwise questioned.
Notwithstanding any provision of law, for purposes of this division all territory in the Kirkwood Meadows Public Utility District shall be deemed to be solely within the County of Alpine, which shall be the principal county for purposes of formation of the district and which shall have jurisdiction to approve, disapprove, and carry out all matters pertaining to formation of the district; provided, however, that nothing in this section shall limit or impair the authority of the Board of Supervisors of the County of El Dorado or the County of Amador to disapprove, by resolution, formation of all or any part of the Kirkwood Meadows Public Utility District within its territory any time prior to final approval of the district by the County of Alpine. If either county so disapproves, any territory designated by the resolution of disapproval shall be excluded from the boundaries of the district.
If the Kirkwood Meadows Public Utility District is not incorporated on or before March 1, 1986, this section is repealed on that date.
ARTICLE 2. Hearing [15731. - 15738.]
By resolution each board of supervisors to which a petition is presented shall fix a time for a hearing, which shall be within 15 days after final publication of notice.
Within 10 days after a petition is presented to it, the board of supervisors shall publish a copy of the petition, and a notice that the petition will be heard by the board at the time and place designated by the resolution.
The hearing may be adjourned from time to time for the determination of facts, not exceeding two weeks in all.
If the signatures attached to the petition are sufficient, no defect in the contents of the petition or in the title to or form of the notice shall vitiate any proceedings thereon.
The publication of notice shall be pursuant to Section 6062 of the Government Code in a newspaper of general circulation, printed, published, and circulated in the respective unit of the unincorporated territory, or if no such newspaper is printed, published, and circulated in the territory, in a newspaper printed and published elsewhere in the county and deemed most likely to give notice to the electors of the territory.
At the hearing or at any time prior thereto, any owner of taxable property within the proposed district may file a petition with the board of supervisors asking that the property described in the petition be excluded from the proposed district. If the board, after hearing, finds the described property will not be substantially benefited by its inclusion in the district, it may exclude such property. At the hearing the board shall make such changes in the proposed boundaries as it deems advisable and shall define and establish the boundaries.
Any person owning land adjoining any land described in the petition, upon his verified application, in the discretion of the board, may have his land included within the proposed district.
At the hearing the board shall determine whether or not the petition complies with the requirements set forth in this division and whether or not the notice has been published as required, and shall hear all competent and relevant testimony offered in support of or in opposition to the petition. If the board determines and finds from the evidence taken at the hearing that the proposed district as its boundaries are described in the petition or as changed by the board is uneconomic or infeasible, it may dismiss the petition, but, if the board determines and finds that the petition complies with the law and that the proposed district is economic and feasible, it shall call an election to be held in the proposed district for the purpose of determining whether or not the district shall be organizaed.
ARTICLE 3. Election [15761. - 15765.]
The special election shall be called by ordinance by each board of supervisors. The ordinance shall specify the purpose and time of the election, establish the election precincts, and designate the polling places and the names of the election officers for each precinct. The election shall be held on the next established election date not less than 74 days after completion of publication of the ordinance.
The ordinance calling the election shall be published in the unincorporated territory pursuant to Section 6062 of the Government Code. If no newspaper is printed, published, and circulated in the territory, publication shall be made in a newspaper printed and published elsewhere in the county and deemed most likely to give notice to the electors of the territory. The notice of election shall also be posted in at least two public places in each precinct within each unincorporated territory in which the election is held for at least 10 days prior to the election.
Within five days after the district formation election has been called, the legislative body which has called the election shall transmit, by registered mail, a written notification of the election call to the executive officer of the local agency formation commission of the county or principal county in which the territory or major portion of the territory of the proposed district is located. Such written notice shall include the name and a description of the proposed district, and may be in the form of a certified copy of the resolution adopted by the legislative body calling the district formation election.
The executive officer, within five days after being notified that a district formation election has been called, shall submit to the commission, for its approval or modification, an impartial analysis of the proposed district formation.
The impartial analysis shall not exceed 500 words in length and shall include a specific description of the boundaries of the district proposed to be formed.
The local agency formation commission, within five days after the receipt of the executive officer’s analysis, shall approve or modify the analysis and submit it to the officials in charge of conducting the district formation election.
The board of supervisors or any member or members of the board authorized by the board, or any individual voter or bona fide association of citizens entitled to vote on the district formation proposition, or any combination of such voters and associations of citizens, may file a written argument for or a written argument against the proposed district formation.
Arguments shall not exceed 300 words in length and shall be filed with the officials in charge of conducting the election not less than 54 days prior to the date of the district formation election.
If more than one argument for or more than one argument against the proposed district formation is filed with the election officials within the time prescribed, such election officials shall select one of the arguments for printing and distribution to the voters.
In selecting the arguments, the election officials shall give preference and priority in the order named to the arguments of the following:
The board of supervisors or any member or members of the board authorized by the board.
Individual voters or bona fide associations of citizens or a combination of such voters and associations.
The officials in charge of conducting the election shall cause a ballot pamphlet concerning the district formation proposition to be voted on to be printed and mailed to each voter entitled to vote on the district formation question.
The ballot pamphlet shall contain the following in the order prescribed:
The complete text of the proposition.
The impartial analysis of the proposition prepared by the local agency formation commission.
The argument for the proposed district formation.
The argument against the proposed district formation.
The election officials shall mail a ballot pamphlet to each voter entitled to vote in the district formation election at least 10 days prior to the date of the election. The ballot pamphlet is “official matter” within the meaning of Section 13303 of the Elections Code.
The election shall be held and conducted, the returns canvassed, and the result declared by the board of supervisors in the manner provided by general law for such elections in the particulars in which provision is made therefor, and in all other respects in the manner provided by law for the holding of special elections within such counties.
The proposition submitted at the election shall be stated upon the ballot substantially as follows:
Within five days after the result of the election is declared, and the order is made where required, the chairman of the board of supervisors of each county in which the election is held shall make and execute a certificate, signed by him as such official and authenticated under the seal of the county, setting forth the proposition submitted to the electors, the fact of such submission, and the result of the election as so declared. The certificate shall be made and executed in duplicate, and shall be delivered in duplicate without delay to the board of supervisors of the county in which the proposed district, or the greater part of its population, is situated, or to the clerk of such board.
ARTICLE 4. Establishment of the District [15791. - 15798.]
The board of supervisors receiving the certificates delivered pursuant to Section 15765 shall meet and examine them within three weeks after all the elections are held. If it appears from the certificates that a majority of the votes cast at the election in each unincorporated territory in which such elections are held is in favor of the incorporation of the district, the board of supervisors shall so declare and shall state by order entered in its minutes the name and boundaries of the district, and that the district is formed pursuant to this division.
If it appears from the certificates that a majority of the electors voting at the election has voted against the formation of the district, the proceedings shall fail entirely.
When the board of supervisors has completed its examination of the certificates, and has made the order provided in Section 15791, it shall forthwith attach together the duplicate certificates in two rolls, each roll to contain one of each of the certificates and a copy of the order of the board of supervisors, duly certified under the hand and official seal of the clerk of the board of supervisors.
The board of supervisors shall immediately deposit one roll for filing in the office of the Secretary of State, and cause the other roll to be recorded in the office of the recorder of each county in which any part of the district is situated and filed in the office of the county elections official of the county in which the district, or the greater part of its population, is situated.
Upon the receipt of the duplicate roll the Secretary of State shall issue his certificate reciting that it is filed in his office and that the public utility district, naming it, is incorporated as a district pursuant to this division. The certificate shall be forwarded to the board of supervisors and by it held and delivered to the board of directors of the district after the election and organization of the board of directors.
No charge shall be made by either the Secretary of State or any county recorder or county elections official for the services required of him or her under this article.
From and after the date the duplicate roll is filed with the Secretary of State, the district is incorporated as a public utility district, with all the rights, privileges, and powers set forth in this division.
The board may change the name of the district by adoption of an ordinance changing the name of the district and by giving notification of the name change to the State Controller, the State Board of Equalization, and the board of supervisors of each county which has land within the district.
ARTICLE 5. Contest of Incorporation [15821. - 15822.]
No informality in any proceeding or in the conduct of any election, not substantially affecting adversely the legal rights of any citizen, shall be held to invalidate the incorporation of any district. Any proceedings wherein the validity of incorporation is sought to be denied shall be commenced within 20 days after the date of the certificate of incorporation, otherwise the incorporation and the legal existence of the district, and all proceedings in respect thereto, shall be held valid and in every respect legal and incontestable.
Any such contest shall be brought in the superior court of the county where the district, or the greater part of its population, is situated. If more than one contest is pending they shall be consolidated and tried together. The court having jurisdiction shall speedily try the contest and determine upon the hearing whether the election was fairly conducted and in substantial compliance with this division, and enter its judgment accordingly. Either party to the record may appeal within 30 days from the entry of judgment, and the appeal shall be heard and determined by the Supreme Court within 60 days from the filing of the notice of appeal.
ARTICLE 6. Verification Deputies [15841. - 15846.]
Verification deputies shall be qualified electors residing within the territory of the district or the proposed district for which they are appointed.
Verification deputies required to verify signatures to petitions for the formation of a district, or to certificates or petitions nominating candidates for election to the first board of directors of newly formed districts, shall be appointed by the county elections official of any county in which the territory of the district is situated, and verification deputies required for any other purpose after the formation of a district shall be appointed by the clerk of the district.
Appointments of verification deputies shall be made upon written application of not less than five (5) nor more than ten (10) qualified electors of any territorial unit or units of the district, or the proposed district, as the case may be. The application shall state that the signers desire the appointment of the person whose name and address is given therein as a verification deputy for the purpose of taking the oaths of signers of petitions or certificates in the matter of ________.
Verification deputies need not use a seal, and shall not have power to administer oaths for any purpose other than that for which they are appointed. Their appointment shall continue for ninety (90) days only from the date of appointment.
Verification deputies shall not be paid, in whole or in part, directly or indirectly, out of the county treasury or the treasury of a district.
Before appointment a verification deputy shall make and file with the clerk appointing him an oath as to his age, place of residence, occupation, and whether or not he is a qualified elector residing within the territory of the district, or the proposed district, for which he is appointed.
CHAPTER 3. Internal Organization of Districts [15951. - 16196.]
ARTICLE 1. Election of Directors [15951. - 15976.]
At an election held in the district on the next established election date not less than 74 days after its formation a board of directors shall be elected, to consist of as many members as there are territorial units in the district and as many additional members, not less than three nor more than four, as are required to constitute a board composed of an odd number of directors. Where the district lies entirely in one county the number of directors shall be three, elected at large.
A director at large shall be a resident and qualified elector of the district.
All unincorporated territories situated in the same county and included within the district shall be regarded as an entirety and as a territorial unit of the district. Each unit having a population of at least 5,000 is entitled to one director.
Candidates for the office of director to be elected by a unit shall be nominated from each such territorial unit, and the remaining number of directors shall be nominated from the district at large.
Each directorship is a separate office for the purpose of nomination and election, and for the filling of vacancies.
Candidates for directors at large shall be designated in all declarations of candidacy, nominating certificates, and on all official election ballots as candidates for a particular directorship at large, in accordance with the declarations of candidacy which the candidates have filed with the county elections official or the clerk of the district, as the case may be. Each office of director at large shall be designated as “director at large” number one, number two, number three, or number four, there being as many numbers as there are directors at large to be elected.
Notwithstanding subdivision (a) or any other provision of this article, the board of directors of a district may adopt an ordinance that requires that candidates for directors at large need not designate a numbered office. The ordinance shall instead require that the candidates receiving the greatest number of votes districtwide as there are directors to be elected shall be elected to the board of directors.
Candidates for director from the several territorial units entitled to one director each shall be designated in all declarations of candidacy, nominating certificates, and on all official election ballots as candidates for director from ____ unit, giving the name or other designation of the unit entitled to the office of director in accordance with the declarations of candidacy which the candidates have filed with the proper clerk.
If only one unit of unincorporated territory is contained in the district, it may be designated as “the unincorporated territorial unit.”
If two or more units of unincorporated territory are contained in the district, they shall be numbered, named, and designated by the board of supervisors in charge of the election of the first board of directors, and subsequently from time to time by the board of directors of the district, as unincorporated territorial unit number one, number two, number three, and so forth, there being as many numbers as there are units in the district.
The board of supervisors shall number, name, and designate each territorial unit of the district by ordinance at a regular or special meeting after the formation of the district, and in time to permit publication and taking effect of the ordinance before the earliest time when nominating certificates and declarations of candidacy for the board of directors may be filed. The ordinance shall remain in force until the board of directors of the district, by ordinance, shall number, name, and designate the territorial units.
Designations of directors by name or number have no significance whatever after election and qualification of the directors or after appointment and qualification of a director appointed to fill a vacancy, but merely fix the designation and status of each such office as a separate office for the purpose of nomination and election thereto, or for filling a vacancy. Sections 15953 to 15960, inclusive, apply to the election of the first board of directors of the district, as well as to all elections of directors held by the district.
Notwithstanding any other provision of the division, the candidates for director of any district that is wholly or partially within the County of Placer may be elected at large, by wards, or from wards upon adoption of a resolution or ordinance to that effect by the board of directors of the district, subject to approval of the board of supervisors, or as a part of a change of organization or a reorganization conducted pursuant to the Cortese-Knox-Hertzberg Local Government Reorganization Act of 2000, Division 3 (commencing with Section 56000) of Title 5 of the Government Code.
A resolution or ordinance that divides a district into wards adopted pursuant to subdivision (a) shall describe the boundaries of the wards so that the wards shall be as nearly equal in population as may be.
As used in this section:
“By wards” means the election of members of the board of directors by voters of the ward alone.
“From wards” means the election of members of the board of directors who are residents of the ward from which they are elected by the voters of the entire district.
Notwithstanding any other provision of this division, the candidates for director of any district that is wholly or partially within the County of San Diego may be elected at large or by subdistricts upon adoption of a resolution or ordinance to that effect by the board of directors of the district, subject to approval of the board of supervisors, or as a part of a change of organization or a reorganization conducted pursuant to the Cortese-Knox-Hertzberg Local Government Reorganization Act of 2000 (Division 3 (commencing with Section 56000) of Title 5 of the Government Code).
A resolution or ordinance that divides a district into subdistricts adopted pursuant to subdivision (a) shall describe the boundaries of the subdistricts so that the subdistricts shall be as nearly equal in population as may be.
As used in this section, “by subdistricts” means the election of members of the board of directors by voters of the subdistrict alone.
The population of each unit of unincorporated territory within the district shall be determined at the time of calling the election of the first board of directors by the board of supervisors calling the election and shall be stated in the ordinance calling the election and in the notice of the election. The determination shall continue in force until set aside by the board of directors of the district.
The board of directors shall determine the boundaries of each unit of unincorporated territory within the district pursuant to Chapter 8 (commencing with Section 22000) of Division 21 of the Elections Code.
The election of directors shall be held in the unincorporated territory included within the district and shall be called by the board of supervisors of the county in which the district, or the greater part of its population, is situated, and shall be called, held, and conducted, the returns canvassed, and the result declared by the board of supervisors in the manner and form provided by law for special elections within the county.
Not less than 30 days prior to the election, any five or more electors in the district may file with the board of directors a petition requesting that the names of certain persons specified in the petition be placed upon the ballot as candidates for the office of director at large.
Not less than 30 days prior to the election, any five or more electors of a territorial unit may file with the board of directors a petition requesting that the name of a designated person specified in the petition be placed upon the ballot as candidate for the office of director from the territorial unit.
A certificate of election shall be issued by the board of supervisors to each person elected and declared elected.
Immediately after receiving his or her certificate of election and before assuming the duties of office, each director shall take and subscribe an official oath and file it in the office of the board.
All official oaths shall be in the form provided by law for official oaths of county officers.
If a person elected fails to qualify, the office shall be filled as if there were a vacancy in the office.
Elections of directors after election of the first board shall be called and held by the board of directors, and shall be called, held, and conducted, nominations for the office of director made, the returns canvassed, and the result declared by the board as provided in Article 6 of this chapter.
The board of directors of a district which lies entirely within one county may submit to the qualified electors, at a general election or a special election called for that purpose, a proposition to increase the number of directors from three to five. By initiative ordinance the electors of such a district may adopt legislation providing for the increase of the number of directors from three to five. The initiative proceedings shall be conducted in all respects as prescribed by general law for the initiative by electors of counties. If a majority of the electors voting at the election vote in favor of the proposition, the district shall have five directors elected at large.
Within 30 days after an increase in the number of directors has been authorized, the board of directors shall appoint two qualified electors of the district to serve as members of the board until the next biennial election, at which there shall be elected two directors in addition to the number previously authorized. After the directors elected at the biennial election have qualified, they shall meet and classify themselves so that one shall hold office for two years and the other for four years. Thereafter, there shall be elected at each biennial district election a number of directors, corresponding to the number whose terms expire, who shall hold office for four years.
Notwithstanding Sections 15951, 15972, and 15973, the local agency formation commission, in approving either a consolidation of districts or the reorganization of two or more districts into a single public utility district may, pursuant to subdivisions (k) and (n) of Section 56886 of the Government Code, increase the number of directors to serve on the board of directors of the consolidated or reorganized district to 7, 9, or 11, who shall be members of the board of directors of the districts to be consolidated or reorganized as of the effective date of the consolidation or reorganization.
Upon the expiration of the terms of the members of the board of directors of the consolidated district, or a district reorganized as described in subdivision (a), whose terms first expire following the effective date of the consolidation or reorganization, the total number of members on the board of directors shall be reduced until the number equals the number of members permitted by the principal act of the consolidated or reorganized district, or any larger number as may be specified by the local agency formation commission in approving the consolidation or reorganization.
In addition to the powers granted under Section 1780 of the Government Code, in the event of a vacancy on the board of directors of the consolidated district or a district reorganized as described in subdivision (a) at which time the total number of directors is greater than five, the board of directors may, by majority vote of the remaining members of the board, choose not to fill the vacancy. In that event, the total membership of the board of directors shall be reduced by one board member. Upon making the determination not to fill a vacancy, the board of directors shall notify the board of supervisors of its decision.
For the purposes of this section the following terms have the following meanings:
“Consolidation” means consolidation, as defined in Section 56030 of the Government Code.
“District” or “special district” means district or special district, as defined in Section 56036 of the Government Code.
“Reorganization” means reorganization, as defined in Section 56073 of the Government Code.
Notwithstanding Section 15952 or any other provision of this division, each member of the board of directors of the Johnsville Public Utility District in Plumas County, whether elected or appointed, shall be either a voter of the district or an owner of land within the district.
Notwithstanding any other provision of this division, candidates for director of the Georgetown Divide Public Utility District may be elected by wards upon adoption of a resolution or ordinance to this effect by the board of directors of the district dividing the district into wards and fixing the boundaries thereof, subject to approval of the board of supervisors. The boundaries shall be fixed such that the wards shall be as nearly equal in population as may be, and the board of supervisors shall approve the boundaries fixed by the board of directors if it so finds.
Nomination papers may be circulated only within the ward from which the candidate is to be elected.
The wards shall be reapportioned subject to the approval of the board of supervisors after each federal decennial census.
Notwithstanding any provision of law, the Board of Directors of the Kirkwood Meadows Public Utility District shall consist of five members, elected at large. Each member of the board, including a member appointed to fill a vacancy, shall be a resident and qualified elector of the district.
If the Kirkwood Meadows Public Utility District is not incorporated on or before March 1, 1986, this section is repealed on that date.
ARTICLE 2. Terms and Compensation of Directors [16001. - 16003.]
On the first Tuesday after their election and qualification, the directors shall meet and classify themselves by lot, so that the largest possible minority shall hold office for two years, and a majority for four years. Thereafter at each biennial district election their successors shall be elected for the term of four years.
Each member of the board may receive the compensation that the board by ordinance provides, not exceeding four thousand eight hundred dollars ($4,800) a year.
As an alternative to subdivision (a), the board may provide, by ordinance or resolution, that each of its members receive compensation in an amount not to exceed one hundred dollars ($100) for each day of service. A member of the board shall not receive compensation for more than 10 days of service in a month.
For the purposes of this subdivision, a “day of service” means any of the following:
A meeting conducted pursuant to the Ralph M. Brown Act (Chapter 9 (commencing with Section 54950) of Part 1 of Division 2 of Title 5 of the Government Code).
Representation of the district at a public event, if that representation has been previously approved at a meeting of the board and the member delivers a written report regarding the member’s representation to the board at the board meeting immediately following the public event.
Representation of the district at a public meeting or a public hearing conducted by another public agency, if that representation has been previously approved at a meeting of the board and the member delivers a written report regarding the member’s representation to the board at the board meeting immediately following the public meeting or public hearing.
Representation of the district at a meeting of a public benefit nonprofit corporation on whose board the district has membership if that representation has been previously approved at a meeting of the district’s board and the member delivers a written report regarding the member’s representation to the board at the board meeting immediately following the corporation’s meeting.
Participation in a training program on a topic that is directly related to the district if that representation has been previously approved at a meeting of the board and the member delivers a written report regarding the member’s participation to the board at the board meeting immediately following the training program.
Notwithstanding subdivisions (a) and (b), the board of directors of a water district, as defined in Section 20200 of the Water Code, may increase the amount of compensation that may be received by members of the board by ordinance adopted pursuant to Chapter 2 (commencing with Section 20200) of Division 10 of the Water Code.
A member of the board may waive any or all of the payments permitted by this section.
For purposes of this section, the determination of whether a member’s activities on any specific day are compensable shall be made pursuant to Article 2.3 (commencing with Section 53232) of Chapter 2 of Part 1 of Division 2 of Title 5 of the Government Code.
A vacancy in the office of director shall be filled pursuant to Section 1780 of the Government Code.
ARTICLE 3. Powers and Duties of Directors [16031. - 16044.]
Except as otherwise provided in this division, the powers of the district shall be exercised by the board of directors.
The board of directors shall choose one of its members president.
The president shall sign all contracts on behalf of the district and perform such other duties as may be imposed by the board.
The board may from time to time contract for or employ any professional services required by the district, the board, or any officers of the district.
At the first meeting of the board, after the board has qualified and organized, it shall appoint the clerk, accountant, general manager, and treasurer.
In lieu of appointing a treasurer, the board may elect that the duties of treasurer be performed by the treasurer of the county in which the district, or the greater part of its population, is situated. Whenever the board by ordinance so determines, such duties shall be performed by the county treasurer. The ordinance shall also prescribe the manner in which money is to be drawn out of the various funds belonging to the district in the hands of the treasurer. The treasurer shall be served with a certified copy of the ordinance.
The board may consolidate two or more offices in the same person.
The board may provide for an assistant to any officer of the district who may perform the acts his principal may perform, when authorized so to do by the board.
At the first meeting after the end of each fiscal year, the board shall render and immediately cause to be published a verified statement of the financial condition of the district.
The financial statement shall show particularly the receipts and disbursements since the publication of the last preceding statement and of the last preceding fiscal year and the source of such receipts and the purpose of such disbursements.
Publication of the financial statement shall be made pursuant to Section 6066 of the Government Code in a newspaper of general circulation printed and published in the district, or if there is no such newspaper, in a newspaper of general circulation printed and published in a county where any part of the district is situated.
No director or other officer of the district shall in any manner be interested, directly or indirectly, in any contract awarded or to be awarded by the board, or in the profits to be derived from it. Violation of this section is a misdemeanor and a director or officer convicted shall forfeit his office, and shall be punished by a fine not exceeding one thousand dollars ($1,000), or by imprisonment in the county jail not exceeding six months, or by both such fine and imprisonment.
A district may destroy a record pursuant to Chapter 7 (commencing with Section 60200) of Division 1 of Title 6 of the Government Code.
ARTICLE 4. Meetings and Legislation [16071. - 16084.]
The board shall establish rules for its proceedings and shall provide for the time and place of holding meetings and the manner in which special meetings may be called. All legislative sessions of the board, whether regular or special, are open to the public. A majority of the board constitutes a quorum for the transaction of business.
The board shall act only by ordinance, resolution, or motion. The ayes and noes shall be taken upon the passage of all ordinances, resolutions, or motions and entered upon the journal of the proceedings of the board. No ordinance, resolution, or motion shall be passed or become effective without the affirmative votes of at least a majority of the board.
The enacting clause of all ordinances shall be:
“Be it enacted by the board of directors of _______ public utility district:”.
All resolutions and ordinances shall be signed by the president of the board and attested by the secretary.
No ordinance passed by the board takes effect less than 30 days after its passage. At least one week before the expiration of the said 30 days copies of the ordinance shall be posted by the clerk at three public places in the district, and if there is a newspaper of general circulation printed and published in the district, the ordinance shall be published in the newspaper pursuant to Section 6061 of the Government Code.
An order entered in the minutes of the board that an ordinance has been duly posted and published is prima facie proof of such posting and publication.
All tax levies for a purpose other than interest or sinking fund payments shall be first authorized by the board by ordinance when the amount proposed to be raised by a tax levy exceeds fifty thousand dollars ($50,000).
During the 30 days following passage of an ordinance pursuant to Section 16077 a petition, signed by qualified voters of the district equal to 10 percent of the entire vote cast within the district for all candidates for Governor at the last preceding general election at which a Governor was voted for, protesting against the passage of the ordinance may be presented to the board.
Immediately upon receipt of a petition submitted pursuant to Section 16078 the board shall cause the clerk of the district to examine and verify the signatures, and to certify the result to the board within 10 days. If the petition is found insufficient, the clerk shall certify to the number of additional signatures of qualified electors required to make the petition sufficient, and the petition may be amended by a supplemental petition filed within 10 days from the date of the certificate.
Within 10 days after the filing of a supplemental petition, the clerk shall examine it and certify to the result of his examination.
An ordinance is suspended from going into operation until the examination, verification, and certification are completed.
If a petition, or petition as amended, is certified to be sufficient the ordinance is suspended from going into operation and the board shall reconsider it.
If the board does not entirely repeal the ordinance upon reconsideration, it shall submit the ordinance to a vote of the electors at a general district election or at a special district election called for the purpose, and the ordinance shall not become operative unless approved by a majority of the voters voting upon it.
Unless otherwise provided in this division, petitions made pursuant to this article, in the matter of form, signatures, and preparation, and the proceedings based upon them, in the matter of calling and conducting an election, the manner of voting, cavassing the return, and declaring the result shall conform as nearly as practicable to the provisions of general law relating to direct legislation or the referendum by cities.
ARTICLE 5. Other Officers [16111. - 16116.]
The officers of the district, other than the board of directors, are:
A clerk, who is also ex officio secretary of the board.
An accountant.
A treasurer.
A general manager.
The officers, other than the board of directors, shall be appointed by the board, hold office at its pleasure, and receive such compensation as is provided for by the board by ordinance. They, or any of them, shall give such bond as is prescribed by the board. They shall perform such duties as are provided by this division, and such further duties as are imposed upon them by the board.
When the district acquires, constructs, owns, or operates two or more public utilities, a general manager may be appointed and employed for each public utility.
Subject to such restrictions as the board may impose, the general manager shall have full charge and control of the construction of the works of the district and of their maintenance and operation. He shall report to the board in accordance with such rules and regulations as it may adopt.
The clerk shall countersign all contracts on behalf of the district. He shall give his full time during office hours to the affairs of the district. He is ex officio secretary of the board and shall keep a record of its proceedings.
The accountant shall install and maintain a system of auditing and accounting which completely and at all times shows the financial condition of the district. He shall draw all warrants to pay demands made against the district when the demands have been first approved by a majority of the board present at the meeting at which the demands are acted upon.
ARTICLE 6. District Elections [16151. - 16165.]
The biennial election for the election of directors shall be held on the first Tuesday after the first Monday in November of odd-numbered years. This election is the general district election.
Except as otherwise provided in this division, districts governed by this division are subject to the provisions of the Uniform District Election Law.
No person may vote at any district election unless he possesses all the requirements of an elector under the general laws and is a qualified elector residing within the district.
If land is annexed to a district, the board shall reestablish the boundaries of the units and election precincts within the district not less than 90 days before any election in the district. The reestablished boundaries shall include the annexed land in the same manner and with the same effect as set forth in Sections 15953 to 15964, inclusive. If land is annexed less than 90 days before an election within the district, the inhabitants of the land included shall not vote at the election.
Whenever a special election is called pursuant to Articles 1 or 2 of Chapter 5 for the purpose of submitting to the electors a proposition, the board shall pass an ordinance calling the election.
At the special election all propositions formulated pursuant to Articles 1 or 2 of Chapter 5 may be submitted to the electors of the district, but no question other than such propositions shall be submitted.
The ordinance calling the election shall set forth the following:
The purposes for which it is called.
The estimated cost of each utility or utility works proposed for acquisition, construction, or completion by the district.
The proposed method and manner of payment.
The day on which the election will be held.
The manner of holding the election.
The manner of voting for or against each proposition submitted to the electors.
If it is necessary to incur a district indebtedness for any utility or public utility works therein proposed, the objects and purposes for which the indebtedness is proposed to be incurred, and that bonds of the district shall issue for the payment of the cost of such utility or public utility works, if the proposition is accepted by the electors.
The election shall be held as provided for holding elections in the district.
ARTICLE 7. Employees [16191. - 16196.]
The maximum time of labor or service required of any laborer, workman, or mechanic employed upon any work of the district, whether employed directly by the district and its officers, or by a contractor or subcontractor, shall be eight hours during any one calendar day, except in case of emergency.
The board shall fix the hours of labor or service required of all employees of the district, and their compensation, and shall employ all necessary employees or may by ordinance provide for their employment by the several officers of the district.
The board shall classify all places of employment under the district and its offices and departments, with reference to the examinations provided by this article, except as provided in Section 16196. The places classified by the board are the classified civil service of the district, and appointments to civil service places shall be made according to the rules provided by this article.
The board shall make rules to effect a civil service system, and for examinations, appointments, promotions, and removals, and from time to time may make changes in existing rules. All rules and all changes shall be forthwith printed for distribution by the board.
Examinations shall be practical, and shall relate to those matters only which will fairly test the relative capacity of the persons examined to discharge the duties of the positions which they seek, and shall include, when appropriate, tests of manual or professional skill. The selection of laborers shall be governed by priority of application as far as practicable. No question in any examination shall relate to political or religious opinions or affiliations. The board shall control all examinations.
The manager, engineer, clerk, accountant, and treasurer shall not be included within the classified civil service of the district.
CHAPTER 4. Powers and Functions of Districts [16401. - 16682.]
ARTICLE 1. Corporate Powers [16401. - 16409.]
A district has perpetual succession.
Except as otherwise provided, a district may sue and be sued in all actions and proceedings, in all courts and tribunals of competent jurisdiction.
Except as provided in subdivision (b), any judicial action or proceeding against a district that provides electric utility service, to attack, review, set aside, void, or annul an ordinance, resolution, or motion fixing or changing a rate or charge for an electric commodity or an electric service furnished by a district and adopted on or after July 1, 2000, shall be commenced within 120 days of the effective date of that ordinance, resolution, or motion.
This section does not apply to any judicial action or proceeding filed pursuant to Chapter 13.7 (commencing with Section 54999) of Part 1 of Division 2 of Title 5 of the Government Code to protest or challenge a rate or charge or to seek the refund of a capital facilities fee if the notice and disclosure requirements of Section 54999.35 of the Government Code have not been followed.
A district may adopt a seal and alter it at pleasure.
A district may exercise the right of eminent domain to take any property necessary or convenient to the exercise of the powers granted in this division.
A district has the same powers with reference to improvement districts as are conferred upon irrigation districts by Division 11, Part 7 of the Water Code and as are conferred upon municipal water districts by Part 7 (commencing with Section 71851) and Part 8 (commencing with Section 72000) of Division 20 of the Water Code. As used in this section, all references to districts in the adopted acts shall refer to public utility districts and all words relating to irrigation or municipal water district officers and matters refer to the corresponding officers of a public utility district and matters under this division.
Improvement districts also may be formed of land proposed to be annexed to the district, contingent upon the annexation being completed. The petition for annexation may request that the land to be annexed shall be included in and form a part of any improvement district existing within the district or shall constitute a new improvement district within the district when annexed or the board of directors of the district may determine, as one of the terms and conditions for the annexation, that the land shall be included in and form a part of any improvement district then existing within the district or shall constitute a new improvement district when annexed.
For the purpose of obtaining and supplying water for domestic, irrigation, and fire protection purposes, a district may cooperate and contract with the United States and borrow or procure money from the United States in the same manner and under the same procedures as irrigation districts under Division 11, Part 6, Chapter 2 of the Water Code. Any district, in order to make payments to the United States under any contract between the district and the United States, may, in lieu, in whole or in part of levying assessments, fix and collect charges for the service of water by the district to any land. A district may charge higher rates for service of water to any landowner in the amount required to pay any interest costs charged to the district on any United States Bureau of Reclamation loan by reason of land held by such owner in excess of 160 acres.
ARTICLE 2. Property [16431. - 16432.]
A district may take by grant, purchase, gift, devise, or lease, or otherwise acquire, hold and enjoy, and lease or dispose of, real and personal property of every kind within or without the district, when in the judgment of the board it is for the best interests of the district so to do.
The legal title to all property acquired under this division vests immediately and by operation of law in the district, and is held by the district in trust, and is dedicated and set apart to the uses and purposes set forth in this division.
ARTICLE 3. Utility Works and Services [16461. - 16489.]
A district may acquire, construct, own, operate, control, or use, within or without or partly within and partly without the district, works for supplying its inhabitants with light, water, power, heat, transportation, telephone service, or other means of communication, or means for the disposition of garbage, sewage, or refuse matter, and may do all things necessary or convenient to the full exercise of the powers granted in this article.
The Shasta Dam Area Public Utility District may construct those public works necessary for the industrial and commercial development of any undeveloped property owned by the district prior to January 12, 1990. A decision by the Shasta Dam Area Public Utility District to construct public works pursuant to this section is a legislative act subject to referendum pursuant to Article 2 (commencing with Section 9340) of Chapter 4 of Division 9 of the Elections Code. The improvements shall comply with all of the ordinances, resolutions, policies, and other standards of the city or county in which the property is located, and comply with all state laws governing public works and public agencies.
Any contract awarded by the Shasta Dam Area Public Utility District pursuant to this section shall be considered a public works project subject to Chapter 1 (commencing with Section 1720) of Part 7 of Division 2 of the Labor Code.
None of the costs for public works constructed pursuant to this section shall be borne by Shasta Dam Area Public Utility District customers.
A district that provides broadband Internet access services shall comply with the requirements of Article 12 (commencing with Section 53167) of Chapter 1 of Part 1 of Division 2 of Title 5 of the Government Code.
A district may also purchase any of such commodities or services from any other utility district, municipality, person, or private company, and distribute them.
A district may acquire, construct, own, complete, use, and operate a fire department, street lighting system, public parks, public playgrounds, golf courses, public swimming pools, public recreation buildings, buildings to be used for public purposes, and works to provide for the drainage of roads, streets, and public places, including, but not limited to, curbs, gutters, sidewalks, and pavement of streets. For purposes of this division, all of those projects shall be considered a public utility or public utility works.
A district may exercise any of the powers, functions, and duties which are vested in, or imposed upon, a fire protection district pursuant to the Fire Protection District Law of 1987, Part 3 (commencing with Section 13800) of Division 12 of the Health and Safety Code.
If the district includes any part of a local agency which provides fire protection service to any territory in the district, the district shall have no authority regarding the prevention and suppression of fires in that territory, unless the district has obtained the consent of the local agency.
A district may construct works across or along any street or public highway, or over any land which is the property of the state, and has the same rights and privileges appertaining thereto as are granted to cities within the state.
A district may construct its works across any stream of water or watercourse.
A district using a street or highway shall restore it to its former state as nearly as possible and shall not unnecessarily impair its usefulness.
Only revenue producing utilities shall be acquired, owned, or operated by a district. So far as possible the board shall fix such charges for commodities or service furnished by any revenue producing utility as will pay all of the expenses of the government of the district, or such portion as the board determines justly apportionable to such utility. The expenses to be paid include:
Salaries, office expenses, and other necessary disbursements.
The operating expenses of the utility.
The interest on any indebtedness incurred for the acquisition, construction, and completion of the utility.
Provisions for a sinking or other appropriate fund for the payment of the principal of such debt as it becomes due.
Provisions for an appropriate fund for repairs, replacements, and betterments.
It is the intention of this section that a district pay all of such charges and expenditures and the interest and principal of its debt from the revenues derived by the district from the operation of its public utilities, and that each public utility owned and operated by a district shall be self-sustaining.
Notwithstanding the provisions of Section 16467 of this code, fire departments, street lighting systems, public parks, public playgrounds, public swimming pools, public recreation buildings, buildings used for a public purpose, and works to provide for the drainage of roads, streets, and public places, including, but not limited to, curbs, gutters, sidewalks, and pavement of streets need not be operated on a self-sustaining, revenue-producing basis. Revenue to defray the cost of acquiring, constructing, installing, maintaining, improving, and operating such utilities and to pay the principal and interest and to create reserve and sinking funds on any indebtedness incurred in connection therewith, may be raised in any manner authorized by this division.
Charges fixed by the board for commodities or services furnished may be made payable in advance.
Except as provided in subdivision (b), charges unpaid at the time specified for the fixing of the rate of taxes may be added to and become part of the annual assessment levied upon the land upon which the commodity or service was used if the property is owned, controlled, or in the possession of the same person who owned, controlled, or was in possession of it during the time the service charges were incurred or if the only transfers made of the property since the date the charges were incurred have been transfers by gift, descent, bequest, or devise.
No district furnishing water for residential use to a tenant shall seek to recover any charges or penalties for the furnishing of water to or for the tenant’s residential use from any subsequent tenant on account of nonpayment of charges by a previous tenant. The district may, however, require that service to subsequent tenants be furnished on the account of the landlord or property owner.
Charges added to an assessment are a lien on the land, except that if, during the year preceding the date on which the first installment of real property taxes which evidence the charges appears on the roll, any real property to which such lien would attach has been transferred or conveyed to a bona fide purchaser for value, or if a lien of a bona fide encumbrancer for value has been created and attaches thereon, then the lien which would otherwise be imposed by this section shall not attach to such property and the district shall within three years after the amount is due file for record in the office of any county recorder a certificate specifying the amount, interest, and penalty due, the name and address as it appears on the records of the district of the person liable for the same, and the fact that the district has complied with all provisions of this part in the determination of the amount required to be paid. From the time of recordation of the certificate, the amount required to be paid together with interest and penalty constitutes a lien upon all real property in the county owned by the person or afterwards and before the lien expires acquired by him. The lien has the force, effect, and priority of a judgment lien and shall continue for 10 years from the time of the filing of the certificate unless sooner released or otherwise discharged. The lien may, within 10 years from the date of the filing of the certificate or within 10 years from the date of the last extension of the lien in the manner herein provided, be extended by filing for record a new certificate in the office of the county recorder of any county and from the time of such filing the lien shall be extended to the real property in such county for 10 years unless sooner released or otherwise discharged.
If the assessment is divided and made payable in two installments, the unpaid charges may be added to and become a part of the first installment of the assessment.
When the board declares that charges are to be added to the annual assessment and the district is availing itself of assessments made by the assessor of any county in which the district is situated, the board shall include in the statement of the tax rate to be transmitted to the county auditor the amount of each of the charges to be levied, and the auditor shall make the charges a part of the assessment in accordance with the statement.
Notwithstanding Sections 16469 to 16472, inclusive, and as an alternative to the procedures specified in those sections, a district may provide by resolution or ordinance that delinquent water charges and interest and penalties thereon constitute a lien on the real property served to the extent that the property is owned by the person or entity receiving the service, when a certificate is recorded pursuant to this section, which shall continue in effect until the amount of charges, interest, and penalties are paid or the property is sold to satisfy the charges, interest, and penalties. No lien may be created under this section on any publicly owned property.
A lien pursuant to this section attaches when the district files for record in the office of the county recorder a certificate specifying the amount of charges, interest, and penalties due; the name of the owner of record of the property who received the water service; the legal description of the property served; and the fact that the district has complied with all provisions of this part in the determination of the charges, interest, and penalties due. From the time of recordation of the certificate, the charges, interest, and penalties constitute a lien on the property. Within 30 days of receipt of payment of all costs specified in subdivision (a), or within 30 days of a demand by an escrow agent in the event of a voluntary sale, the district shall record in the office of the county recorder a release of the lien created by this section.
This section is in addition to any other remedies available to a district.
In order to enforce the provisions of any ordinance of the district, including an ordinance fixing charges for the furnishing of commodities or services, the district may correct any violation of an ordinance of the district. The district may also petition the superior court for the issuance of a preliminary or permanent injunction, or both, as may be appropriate, restraining any person from the continued violation of any ordinance of the district or for the issuance of an order stopping or disconnecting a service if the charges for that service are unpaid at the time specified in the ordinance.
The district may enter upon the private property of any person within the jurisdiction of the district in order to investigate possible violations of an ordinance of the district. The investigation shall be made with the consent of the owner or tenant of the property or, if consent is refused, with a warrant duly issued pursuant to the procedures set forth in Title 13 (commencing with Section 1822.50) of Part 3 of the Code of Civil Procedure, except that, notwithstanding Section 1822.52 of the Code of Civil Procedure, the warrant shall be issued only upon probable cause.
Whenever there is a surplus of available water, light, heat, or power above that which is required by the inhabitants or municipalities within the district, the district may sell or otherwise dispose of such surplus outside of the district to persons, firms, and public or private corporations.
Whenever any of the facilities, works, or utilities of all or part of a district is not used or employed to its fullest capacity for the benefit or requirements of the district or its inhabitants, the district may employ such surplus facilities to supply any of its public utility services outside the boundaries of the district upon such terms and conditions and under such agreement as its board determines is for the best interests of the district. Any public utility service supplied by a district outside its boundaries shall not exceed in amount the same type of public utility service supplied by the district within its boundaries.
A public utility district which acquires, constructs, owns, operates, controls or uses works for supplying its inhabitants with water, may, pursuant to the notice, protest, and hearing procedures in Section 53753 of the Government Code, fix and collect a water standby or immediate availability charge on all land within its boundaries to which water is made available for any purpose by the district, whether the water is actually used or not, except that such charge shall not supply to lands permanently dedicated exclusively to transportation of persons or property. If the procedures set forth in this section as it read at the time a standby charge was established were followed, the district’s board of directors may, by resolution, continue the charge pursuant to this section in successive years at the same rate. If new, increased, or extended assessments are proposed, the district shall comply with the notice, protest, and hearing procedures in Section 53753 of the Government Code.
The board of directors of the district which fixes such a charge may establish schedules varying the charges in different months and in different localities within a public utility district depending upon factors such as the uses to which the land is put, the cost of transporting the water to the land, the degree of availability or quantity of use of such water to the affected lands. The board may not, however, fix an annual charge in excess of ten dollars ($10) per acre or in excess of five dollars ($5) for parcel of less than one acre, unless the standby charge is imposed pursuant to the Uniform Standby Charge Procedures Act (Chapter 12.4 (commencing with Section 54984) of Part 1 of Division 2 of Title 5 of the Government Code).
If a person for more than one year obtains substantially all of his or her water requirements for the contiguous parcels of land which he or she occupies from rainfall, springs, streams, lakes, rivers, or wells, and if the person’s primary economic activity on such land is the commercial extraction or processing of minerals, such land shall be exempt from any water standby or availability charges.
Any funds derived from the charges levied pursuant to this section may be used by the district for all purposes which a public utility district is authorized to expend funds insofar as said purposes relate to the acquisition, construction, operation, control, or use of works for supplying its inhabitants with water.
The Tahoe City Public Utility District may acquire, construct, install, maintain, improve, or operate public walkways, paths, sidewalks, trails, and public parking facilities if all of the following conditions are met:
The Board of Supervisors of Placer County adopts a resolution authorizing the district to exercise these powers.
The improvements comply with all of the ordinances, resolutions, policies, and other standards of the city or county in which the property is located, and comply with all state laws governing public works and public agencies.
Notwithstanding Section 16467, the services, facilities, or installations or operation thereof provided for in subdivision (a) need not be financed on a revenue-producing basis. Revenue to defray the cost of constructing, installing, maintaining, and operating the facilities or services or to pay the principal and interest and to create reserve and sinking funds on any indebtedness incurred in connection therewith, may be raised in any manner authorized by this division.
Assessments levied to pay for the acquisition, construction, installation, maintenance, improvement, or operation of public walkways, paths, sidewalks, trails, and public parking facilities pursuant to this section shall be subject to approval by a majority vote of the property owners of the assessment district in which the services, facilities, or installations are located.
Notwithstanding Section 16475, the Board of Directors of the Fallbrook Public Utility District may, pursuant to the notice, protest, and hearing procedures in Section 53753 of the Government Code, fix and collect an annual water standby or immediate availability charge. The standby or immediate availability charge shall not exceed thirty dollars ($30) per acre or any parcel of less than one acre, unless the standby or immediate availability charge is imposed pursuant to the Uniform Standby Charge Procedures Act (Chapter 12.4 (commencing with Section 54984) of Part 1 of Division 2 of Title 5 of the Government Code).
The Legislature hereby finds and declares that this section, applicable only to the Fallbrook Public Utility District, is necessary because of the unique and special water management problems within that district.
The Board of Directors of the Tahoe City Public Utility District, the Board of Directors of the South Tahoe Public Utility District, and the Board of Directors of the North Tahoe Public Utility District shall each have the authority to fix and collect an annual standby charge for sewage service on all lands within the district under its jurisdiction, in such amount as the board shall specify, provided that such standby charge for sewage service shall not exceed ten dollars ($10) per acre for parcels in excess of one acre or twenty dollars ($20) per parcel for parcels less than one acre, unless the standby charge is imposed pursuant to the Uniform Standby Charge Procedures Act (Chapter 12.4 (commencing with Section 54984) of Part 1 of Division 2 of Title 5 of the Government Code).
The standby charge authorized by this section shall be imposed only pursuant to the notice, protest, and hearing procedures in Section 53753 of the Government Code. If the procedures set forth in this section as it read at the time a standby charge was established were followed, that charge pursuant to this section may be levied at the same rate in subsequent years without the requirement of a hearing, provided that if new, increased, or extended assessments are proposed, the board of directors shall comply with the notice, protest, and hearing procedures in Section 53753 of the Government Code.
The Legislature hereby finds and declares that this section, applicable only to the Tahoe City Public Utility District, the South Tahoe Public Utility District, and the North Tahoe Public Utility District is necessary because of the unique and special water management, pollution, and sewage disposal problems of the Lake Tahoe Basin.
If the Board of Directors of the Tahoe City Public Utility District or of the North Tahoe Public Utility District determines to use all or any portion of a surplus remaining in the improvement fund from any assessment proceeding to improve the sewer system within district’s jurisdiction in accordance with the provisions of subdivision (c) of Section 10427 of the Streets and Highways Code, all of the surpluses to be used for the maintenance of the improvements may be transferred by the legislative body to a single fund for the maintenance and operation of the sewer system without regard to the proportion of the funds so created attributable to each proceeding from which the surplus arose.
The board of directors shall transfer to such single fund the same percentage of the surplus from each improvement fund. The fact that in one or more of such improvement funds no surplus exists shall not prevent the board of directors from proceeding pursuant to this section as to all improvement funds in which a surplus does exist if a surplus of no less than 212 percent of the total cost exists in no less than 75 percent of such funds.
This section, applicable only to the Tahoe City Public Utility District and the North Tahoe Public Utility District, is necessary because of unique and special fiscal management problems of improvement districts in the Lake Tahoe Basin.
Every district furnishing light, heat, or power shall expend no funds for advertising when such advertising encourages increased consumption of such services or commodities.
Nothing in this section shall prohibit a district furnishing light, heat, or power from expending funds for advertising which encourages the more efficient operation of the facilities, works, or utilities of the district, or for advertising which encourages the more efficient use of light, heat, or power, the conservation of energy or natural resources, or presents accurate information on the economical purchase, maintenance, or use of any appliance or device using light, heat, or power.
Whenever a business transaction of a public utility district furnishing electricity, gas, water service where the utility has 10,000 or more service connections, or telephone service is such that a personal appearance by a person is required by the district and the person is unable to appear at the district’s place of business during the district’s usual business hours, then the district shall provide a reasonable and convenient alternative to the person such as an appointment outside the district’s usual business hours or allowing the person to conduct the transaction by telephone, mail, or both.
This section applies if there is a landlord-tenant relationship between the residential occupants and the owner, manager, or operator of the dwelling.
If a district furnishes individually metered residential light, heat, water, or power to residential occupants in a detached single-family dwelling, multiunit residential structure, mobilehome park, or permanent residential structure in a labor camp, as defined in Section 17008 of the Health and Safety Code, and the owner, manager, or operator is the customer of record, the district shall make every good faith effort to inform the residential occupants, by means of written notice, when the account is in arrears, that service will be terminated in 10 days. The written notice shall further inform the residential occupants that they have the right to become customers of the district without being required to pay the amount due on the delinquent account. The notice shall be in English and in the languages listed in Section 1632 of the Civil Code.
The district is not required to make service available to the residential occupants unless each residential occupant agrees to the terms and conditions of service, and meets the requirements of the district’s rules. However, if one or more of the residential occupants are willing and able to assume responsibility for the subsequent charges to the account to the satisfaction of the district, or if there is a physical means, legally available to the district, of selectively terminating service to those residential occupants who have not met the requirements of the district’s rules, the district shall make service available to the residential occupants who have met those requirements.
If prior service for a period of time is a condition for establishing credit with the district, residence and proof of prompt payment of rent or other credit obligation acceptable to the district for that period of time is a satisfactory equivalent.
Any residential occupant who becomes a customer of the district pursuant to this section whose periodic payments, such as rental payments, include charges for residential light, heat, water, or power, where these charges are not separately stated, may deduct from the periodic payment each payment period all reasonable charges paid to the district for those services during the preceding payment period.
If a district furnishes residential light, heat, water, or power to residential occupants through a master meter in a multiunit residential structure, mobilehome park, or permanent residential structure in a labor camp, as defined in Section 17008 of the Health and Safety Code, and the owner, manager, or operator of the structure or park is listed by the district as the customer of record, the district shall make every good faith effort to inform the residential occupants, by means of a written notice posted on the door of each residential unit at least 15 days prior to termination, when the account is in arrears, that service will be terminated on a date specified in the notice. If it is not reasonable or practicable to post the notice on the door of each residential unit, the district shall post two copies of the notice in each common area and at each point of access to the structure or structures. The notice shall further inform the residential occupants that they have the right to become customers, to whom the service will be billed, of the district without being required to pay the amount due on the delinquent account. The notice also shall specify, in plain language, what the residential occupants are required to do in order to prevent the termination or reestablish service; the estimated monthly cost of service; the title, address, and telephone number of a representative of the district who can assist the residential occupants in continuing service; and the address and telephone number of a legal services project, as defined in Section 6213 of the Business and Professions Code, which has been recommended by the local county bar association. The notice shall be in English and in the languages listed in Section 1632 of the Civil Code.
The district is not required to make service available to the residential occupants unless each residential occupant or a representative of the residential occupants agrees to the terms and conditions of service, and meets the requirements of law and the district’s rules. However, if one or more of the residential occupants or the representative of the residential occupants are willing and able to assume responsibility for subsequent charges to the account to the satisfaction of the district, or if there is a physical means, legally available to the district, of selectively terminating service to those residential occupants who have not met the requirements of the district’s rules or for whom the representative of the residential occupants is not responsible, the district shall make service available to the residential occupants who have met those requirements or on whose behalf those requirements have been met.
If prior service for a period of time or other demonstration of credit worthiness is a condition for establishing credit with the district, residence and proof of prompt payment of rent or other credit obligation during that period of time acceptable to the district is a satisfactory equivalent.
Any residential occupant who becomes a customer of the district pursuant to this section whose periodic payments, such as rental payments, include charges for residential light, heat, water, or power, where these charges are not separately stated, may deduct from the periodic payment each payment period all reasonable charges paid to the district for those services during the preceding payment period.
If a district furnishes residential service subject to subdivision (a), the district may not terminate that service in any of the following situations:
During the pendency of an investigation by the district of a customer dispute or complaint.
If the customer has been granted an extension of the period for payment of a bill.
For an indebtedness owed by the customer to any other public agency or when the obligation represented by the delinquent account or other indebtedness was incurred with any public agency other than the district.
If a delinquent account relates to another property owned, managed, or operated by the customer.
If a public health or building officer certifies that termination would result in a significant threat to the health or safety of the residential occupants or the public.
Notwithstanding any other provision of law, and in addition to any other remedy provided by law, if the owner, operator, or manager, by any act or omission, directs, permits, or fails to prevent a termination of service while any residential unit is occupied, the residential occupant or the representative of the residential occupants may commence an action for the recovery of all of the following:
Reasonable costs and expenses incurred by the residential occupant or the representative of the residential occupants related to restoration of service.
Actual damages related to the termination of service.
Reasonable attorney’s fees of the residential occupants, the representative of the residential occupants, or each of them, incurred in the enforcement of this section, including, but not limited to, enforcement of a lien.
Notwithstanding any other provision of law, and in addition to any other remedy provided by law, if the owner, manager, or operator, by any act or omission, directs, permits, or fails to prevent a termination of service while any residential unit receiving that service is occupied, the corporation may commence an action for the recovery of all of the following:
Delinquent charges accruing prior to the expiration of the notice prescribed by subdivision (a).
Reasonable costs incurred by the corporation related to the restoration of service.
Reasonable attorney’s fees of the corporation incurred in the enforcement of this section or in the collection of delinquent charges, including, but not limited to, enforcement of a lien.
If the court finds that the owner, manager, or operator has paid the amount in arrears prior to termination, the court shall allow no recovery of any charges, costs, damages, expenses, or fees under this subdivision from the owner, manager, or operator.
An abstract of any money judgment entered pursuant to subdivision (f) or (g) shall be recorded pursuant to Section 697.310 of the Code of Civil Procedure.
No termination of service subject to this section may be effected without compliance with this section, and any service wrongfully terminated shall be restored without charge to the residential occupants or customer for the restoration of the service. In the event of a wrongful termination by the district, the district shall, in addition, be liable to the residential occupants or customer for actual damages resulting from the termination and for the costs of enforcement of this section, including, but not limited to, reasonable attorney’s fees, if the residential occupants or the representative of the residential occupants make a good faith effort to have the service continued without interruption.
The district shall adopt rules and regulations necessary to implement this section and shall liberally construe this section to accomplish its purpose of ensuring that service to the residential occupants is not terminated due to nonpayment by the customer unless the district has made every reasonable effort to continue service to the residential occupants. The rules and regulations shall include, but are not limited to, guidelines for assistance to actual users in the enforcement of this section and requirements for the notice prescribed by subdivision (a), including, but not limited to, clear wording, large and boldface type, and comprehensive instructions to ensure full notice to the actual users.
Nothing in this section broadens or restricts any authority of a local agency that existed prior to January 1, 1989, to adopt an ordinance protecting a residential occupant from the involuntary termination of residential public utility service.
This section preempts any statute or ordinance permitting punitive damages against any owner, manager, or operator on account of an involuntary termination of public utility service or permitting the recovery of costs associated with the formation, maintenance, and termination of a tenant’s association.
For purposes of this section, “representative of the residential occupants” does not include a tenants’ association.
The decision of a district to require a new residential applicant to deposit a sum of money with the district prior to establishing an account and furnishing service shall be based solely upon the credit worthiness of the applicant as determined by the district.
No district furnishing its inhabitants with light, water, power, heat, or means for the disposition of garbage, sewage, or refuse matter may terminate residential service for nonpayment of a delinquent account unless the district first gives notice of the delinquency and impending termination, as provided in Section 16482.1.
No district shall terminate residential service for nonpayment in any of the following situations:
During the pendency of an investigation by the district of a customer dispute or complaint.
When a customer has been granted an extension of the period for payment of a bill.
On the certification of a licensed physician and surgeon that to do so will be life threatening to the customer and the customer is financially unable to pay for service within the normal payment period and is willing to enter into an amortization agreement with the district pursuant to subdivision (e) with respect to all charges that the customer is unable to pay prior to delinquency.
Any residential customer who has initiated a complaint or requested an investigation within five days of receiving the contested bill, or who has, within 13 days of mailing of the notice required by subdivision (a), made a request for extension of the payment period of a bill asserted to be beyond the means of the customer to pay in full during the normal period for payment, shall be given an opportunity for review of the complaint, investigation, or request by a review manager of the district. The review shall include consideration of whether the customer shall be permitted to amortize the unpaid balance of the account over a reasonable period of time, not to exceed 12 months. No termination of service shall be effected for any customer complying with an amortization agreement if the customer also keeps the account current as charges accrue in each subsequent billing period.
Any customer whose complaint or request for an investigation pursuant to subdivision (c) has resulted in an adverse determination by the district may appeal the determination to the board. Any subsequent appeal of the dispute or complaint to the board is not subject to this section.
Any customer meeting the requirements of paragraph (3) of subdivision (b) shall, upon request, be permitted to amortize, over a period not to exceed 12 months, the unpaid balance of any bill asserted to be beyond the means of the customer to pay within the normal period for payment.
A district furnishing light, heat, water, or power, or means for the disposition of garbage, sewage, or refuse matter, shall not terminate residential service on account of nonpayment of a delinquent account unless the district first gives notice of the delinquency and impending termination, at least 10 days prior to the proposed termination, by means of a notice mailed, postage prepaid, to the customer to whom the service is billed, not earlier than 19 days from the date of mailing the district’s bill for services, and the 10-day period shall not commence until five days after the mailing of the notice.
Every district shall make a reasonable, good faith effort to contact an adult person residing at the premises of the customer by telephone or personal contact, at least 48 hours prior to any termination of service, except that, whenever telephone or personal contact cannot be accomplished, the district shall give, by mail, in person, or by posting in a conspicuous location at the premises, a notice of termination of service, at least 48 hours prior to termination.
Every district shall make available to its residential customers who are 65 years of age or older, or who are dependent adults as defined in Section 15610.23 of the Welfare and Institutions Code, a third-party notification service, whereby the district will attempt to notify a person designated by the customer to receive notification when the customer’s account is past due and subject to termination. The notification shall include information on what is required to prevent termination of service. The residential customer shall make a request for third-party notification on a form provided by the district, and shall include the written consent of the designated third party. The third-party notification does not obligate the third party to pay the overdue charges, nor shall it prevent or delay termination of service.
Every notice of termination of service pursuant to subdivision (a) shall include all of the following information:
The name and address of the customer whose account is delinquent.
The amount of the delinquency.
The date by which payment or arrangements for payment is required in order to avoid termination.
The procedure by which the customer may initiate a complaint or request an investigation concerning service or charges, except that, if the bill for service contains a description of that procedure, the notice pursuant to subdivision (a) is not required to contain that information.
The procedure by which the customer may request amortization of the unpaid charges.
The procedure for the customer to obtain information on the availability of financial assistance, including private, local, state, or federal sources, if applicable.
The telephone number of a representative of the district who can provide additional information or institute arrangements for payment.
Every notice of termination of service pursuant to subdivision (b) shall include the items of information in paragraphs (1), (2), (3), (6), and (7).
All written notices shall be in a clear and legible format.
If a residential customer fails to comply with an amortization agreement, the district shall not terminate service without giving notice to the customer at least 48 hours prior to termination of the conditions the customer is required to meet to avoid termination, but this notice does not entitle the customer to further investigation by the district.
A termination of service shall not be effected without compliance with this section. Any service wrongfully terminated shall be restored without charge for the restoration of the service, and a notation thereof shall be mailed to the customer the customer’s billing address.
No electrical, gas, heat, or water public utility district shall, by reason of delinquency in payment for any electric, gas, heat, or water services, cause cessation of any such services on any Saturday, Sunday, legal holiday, or at any time during which the business offices of the district are not open to the public.
A public utility district which acquires, constructs, owns, operates, controls or uses works for supplying its inhabitants with electricity, may fix and collect charges in the manner provided in Article 3 (commencing with Section 16461) and Article 8 (commencing with Section 16641), Chapter 4, Division 7 of the Public Utilities Code, for an electricity standby or immediate availability charge on all lands within its boundaries to which electricity is made available for any purpose by the district, whether the electricity is actually used or not.
The board of directors of the districts which fixes such a charge may exempt certain classes of users from such a charge and may establish schedules varying the charges in different months and in different localities within a public utility district depending upon factors such as the uses to which the electricity is put, the cost of transmitting the electricity to the user, the degree of availability or quantity of use of such electricity. The board may not, however, fix an annual charge in excess of twenty dollars ($20) per acre or in excess of ten dollars ($10) for a parcel of less than one acre.
Any funds derived from the charges levied pursuant to this section may be used by the district for all purposes which a public utility district is authorized to expend funds insofar as these purposes relate to the acquisition, construction, operation, control, or use of works for supplying its inhabitants with electricity.
In addition to all other powers, excepting telephone service, authorized by this division, the Kirkwood Meadows Public Utility District may acquire, construct, own, and operate public parking facilities and cable television facilities and may provide snow removal and road maintenance services for all roads open to the public, including, but not limited to, public roads and roads offered for dedication but not accepted, within the district. Prior to providing any snow removal or road maintenance services, the district shall obtain the consent of any public agency owning the roads. Notwithstanding Section 16467, the facilities and services provided in this subdivision need not be operated on a self-sustaining, revenue-producing basis. Revenue to defray the cost of the facilities and services may be raised in any manner authorized by this division.
The Kirkwood Meadows Public Utility District may exercise all of the powers of a mosquito abatement district or vector control district, as set forth in the Mosquito Abatement and Vector Control District Law (Chapter 5 (commencing with Section 2000) of Division 3 of the Health and Safety Code), within the service area of the Kirkwood Meadows Public Utility District.
Notwithstanding any other provision of law, the Kirkwood Meadows Public Utility District may issue bonds and incur indebtedness pursuant to the Improvement Act of 1911 (Division 7 (commencing with Section 5000) of the Streets and Highways Code), the Municipal Improvement Act of 1913 (Division 12 (commencing with Section 10000) of the Streets and Highways Code), the Improvement Bond Act of 1915 (Division 10 (commencing with Section 8500) of the Streets and Highways Code), or the Revenue Bond Law of 1941 (Chapter 6 (commencing with Section 54300) of Part 1 of Division 2 of Title 5 of the Government Code) for the purpose of acquiring, constructing, owning, and operating any revenue-producing improvement, building, system, plant, works, facilities, undertaking, or other enterprise used for or useful for the generation, production, transmission, or distribution of electricity or gas for light, heat, or power for public or private uses.
If the Kirkwood Meadows Public Utility District is not incorporated on or before March 1, 1986, this section is repealed on that date.
Every district shall comply with Section 8029.5.
The June Lake Public Utility District may exercise all of the powers of a mosquito abatement district or vector control district, as set forth in the Mosquito Abatement and Vector Control District Law (Chapter 5 (commencing with Section 2000) of Division 3 of the Health and Safety Code), within the service area of the June Lake Public Utility District.
ARTICLE 5. Purchase of Supplies and Advertising [16531. - 16531.]
Except as otherwise provided, the board shall determine annually what goods, merchandise, stores, subsistence, materials, and other supplies will be needed by the district for the ensuing year.
ARTICLE 6. Indebtedness and Financing [16571. - 16580.]
A district may borrow money and incur or assume indebtedness, and issue bonds or other evidences of indebtedness.
A district may refund or retire any of its existing or assumed indebtedness.
No district shall incur any funded indebtedness which in the aggregate exceeds 20 percent of the assessed valuation of all real and personal property situated within the district.
The board of directors or other officers of the district may not incur any debt or liability, either by issuing bonds or otherwise, in excess of the express provisions of this division. Any debt or liability incurred in excess of those express provisions is absolutely void, excepting that the debt limitations may be exceeded where the district finances waterworks or sewage disposal facilities by means of a revenue bond issue, or by means of a general obligation bond issue, or by means provided by Section 16580 and makes provision to pledge, as additional security for the general obligation or indebtedness, all or any part of revenues received from the facilities over a period not to exceed 40 years, in which event the limitation of indebtedness set forth in Section 16573 of this code may not be applicable to the bonds or indebtedness so secured or so additionally secured by the revenue.
A district may issue bonds for the purpose of acquiring or constructing any waterworks necessary or proper for carrying out the objects and purposes of the district, in like manner as other bonds are authorized to be issued under this division, and may pledge the revenue, income, receipts, and profits from the operation of the waterworks to the payment of the principal of and interest on the bonds. A district may, if it so elects, declare the payment thereof shall be made solely from the revenue, income, receipts, and profits.
Notwithstanding any provision of this division limiting the amount of indebtedness which may be incurred by it, in order to repair and replace structures and equipment impaired or destroyed or both by flood, fire, earthquake, or other catastrophe, upon the unanimous vote of its board, a district may do any or all of the following:
Borrow money at a rate of interest not exceeding 8 percent a year, including borrowing from the United States or any of its agencies, in a principal amount not to exceed 6 percent of the assessed value of all real and personal property situated in the district.
Issue evidences of indebtedness to represent the sum borrowed.
Arrange terms for the repayment of the sum borrowed.
A district may refinance any indebtedness incurred pursuant to Section 16576 by borrowing from the United States or any of its agencies and issuing in connection therewith evidences of indebtedness in the form and upon the terms required by the United States or its agency. The sum so borrowed shall not exceed the amount of the obligation being refinanced, and interest shall not exceed 8 percent per year. The money so borrowed for refinancing shall be used only to repay the obligation for the retirement of which the money was borrowed.
A district may accept, without limitation by any other provisions of this division requiring approval of indebtedness, contributions or loans from the United States, or any department, instrumentality, or agency thereof, for the purpose of financing the construction, maintenance, and operation of any enterprise in which the district is authorized to engage, and may enter into contracts and co-operate with, and accept co-operation from, the United States, or any department, instrumentality, or agency thereof, in the construction, maintenance, and operation, and in financing the construction, maintenance, and operation, of any such enterprise in accordance with any legislation which Congress may have heretofore adopted or may hereafter adopt, under which aid, assistance, and co-operation may be furnished by the United States in the construction, maintenance, and operation or in financing the construction, maintenance, and operation of any such enterprise. A district may do any and all things necessary in order to avail itself of such aid, assistance, and co-operation under any federal legislation now or hereafter enacted. Any evidence of indebtedness issued under this section shall constitute a negotiable instrument.
A district may contract with any state agency to finance any district improvement authorized by Section 16461 that is related to the provision of water for human consumption. The terms of the contract shall be consistent with this chapter. Notwithstanding any other provision in this chapter, the term of the contract may extend up to 30 years.
ARTICLE 7. Receipts, Accounts, and Audits [16601. - 16614.]
Receipts from the operation of a public utility shall be paid daily into the treasury of the district in a special fund set aside for such public utility.
The board may from time to time make appropriations from individual public utility funds for the following purposes:
The payment of operating expenses of the public utility and all or such portion of the general salary and expense fund of the district as the board determines is justly apportionable thereto.
Repairs and reconstruction.
Payment of interest and sinking fund on the bonds or indebtedness incurred or assumed for acquisition, construction, or completion of the public utility.
Extensions and improvements.
A reserve fund.
Whenever a reserve fund exceeds one-half of the payment for operating expenses in the preceding fiscal year, the board may appropriate such excess to the general fund.
The books of account of the district shall show all of the following:
The true and complete financial results of the ownership and operation of each public utility.
The actual cost of each public utility.
All costs of maintenance, extension, and improvement, and all operating expenses of every description.
The accounts of the district shall be examined at least once a year by an expert accountant, who shall report to the directors the result of his examination. He shall be employed and selected in such manner as the board directs, and shall receive for his services such compensation as the board prescribes, to be paid out of the income or revenues of the district.
Every two years the board may, and upon petition of 15 percent of the electors of the district shall, employ a qualified expert who shall with all due diligence examine and report upon the following:
The system of accounts kept by the district.
All the contracts made and entered into by the board within the two years immediately preceding.
The management of the utilities of the district, their operation, the service furnished, and the rates charged by the district.
The properties and investments of the district.
All official acts of the board relating to acquisition, construction, completion, extension, improvement, and betterment of the public utilities of the district.
The efficiency and adequacy of each public utility, and of the property used in connection with it or with its operation, the reasonableness of the service and commodities furnished, and of the rates and charges therefor.
All the business and affairs of the district relating to the ownership, management, and operation of each public utility of the district.
The expense of employing an expert shall not exceed fifteen thousand dollars ($15,000) at any one time, to be paid out of the income and revenues of the district, as the board prescribes.
Experts shall be selected by the Public Utilities Commission, and their names and addresses certified to the board of directors of the district. Several experts may be so selected and certified.
Whenever an expert is to be employed pursuant to Section 16606, at least four months before each biennial district election the board shall request in writing the Public Utilities Commission to select and certify experts. The commission shall transmit the names of experts to the board making the request within two weeks after receipt of the request by the commission.
Within 10 days after receipt of a certification the board shall by resolution entered on its minutes employ the expert, or one of the experts selected and certified, fix the amount of his compensation either absolutely or on a per diem basis, and notify the expert of his appointment.
In his report the expert shall make such recommendations and suggestions as to him seem proper and required for the good of the district, the efficient and economical or advantageous management and operation of the public utility of the district, and the business and affairs of the district relating to such management and operation.
In his report the expert shall make such recommendations and suggestions as to:
The system of accounts kept, or in his judgment to be kept in connection with each public utility.
The classification of the public utilities of the district and the establishment of a system of accounts for each class.
The manner in which such accounts shall be kept.
The forms of accounts, records, and memoranda kept or to be kept, including accounts, records, and memoranda of receipts and expenditures of money, and depreciation and sinking fund accounts, as in his judgment are proper and necessary.
The expert shall enter upon his duties at least 90 days before the next impending biennial district election, and shall complete his examination and file his report at least 30 days before the election.
The expert’s report shall be made in duplicate to the electors of the district. One copy shall be filed with the board in the office of the clerk of the district, and one copy shall be recorded in the office of the county recorder of the county in which the district, or the greater part of its population, is situated. The county recorder shall record, index, and keep the report as a public record in his office, and shall make no charge for such recording.
ARTICLE 8. Taxation [16641. - 16660.]
A district may levy and collect, or cause to be levied and collected, taxes for the purpose of carrying on its operations and paying its obligations.
A district may impose a special tax pursuant to Article 3.5 (commencing with Section 50075) of Chapter 1 of Part 1 of Division 1 of Title 5 of the Government Code. The special taxes shall be applied uniformly to all taxpayers or all real property within the district, except that unimproved property may be taxed at a lower rate than improved property.
Farm products and crops which are stored within the exterior boundaries of the district are not subject to taxation by the district.
The board shall annually levy and collect a tax sufficient (a) to pay the annual interest on bonds, (b) to pay such part of the principal as will fall due within the succeeding year, and (c) to provide for the sinking fund payments of the next succeeding fiscal year.
When the interest and sinking fund payments for any fiscal year on bonds issued for a public utility or public utility works can be met out of the surplus earnings of such public utility, or out of moneys in the general fund of the district theretofore appropriated and transferred to the sinking fund of the public utility, no tax shall be levied for such purpose.
If from any cause the revenues of a district are inadequate to pay the principal or interest on any bonded debt as it becomes due, the board shall, or if funds are needed to carry out the objects and purposes of the district which cannot be provided out of the revenues of the district the board may, levy a tax for such purposes.
The board shall state the purposes for which taxes are necessary, and shall fix by ordinance the amount of money necessary to be raised by taxation.
By ordinance, the provisions of which conform to general law, the board may provide the manner of assessing and of correcting and equalizing assessments upon the taxable property situated within the district.
The board may provide for the collection of delinquent taxes, penalties, interest, and costs by actions or legal proceedings brought, prosecuted, and maintained in the name of the district against the several owners of property from whom taxes are due and delinquent.
The board may elect to avail itself of the assessments made by the assessors of the counties in which the district is situated, and may take such assessments as the basis for district taxation. It shall declare its election by ordinance and file a certified copy of the ordinance with the auditors of the counties in which the district is situated.
An election pursuant to Section 16648 is effective with respect to all taxes levied and assessed after February 1 next succeeding the date upon which the certified copy is filed. Thereafter all assessments shall be made and taxes collected by the assessors or tax collectors of the counties in which the district is situated until the board by ordinance elects otherwise. When the board elects otherwise, a certified copy of such ordinance shall be filed with the auditors of the counties in which the district is situated and it is effective with respect to all taxes levied and assessed after February 1st next succeeding the date upon which the certified copy is filed.
Upon receipt of the certified copy filed pursuant to Section 16648 the county auditors shall, on or before the second Monday in August of each year, transmit to the board a statement in writing showing the total value of all property within the district, ascertained from the assessment book of the counties for that year as equalized and corrected by the boards of supervisors.
If the board elects to avail itself of county assessments, it shall, before September 1st, fix the rate of taxes, designating the number of cents upon each one hundred dollars ($100), using as a basis the value of property as ascertained from the equalized assessment rolls of the county or counties. The rate of taxation shall be sufficient to raise the amount previously fixed by the board. These acts by the board are a valid assessment of the property and a valid levy of the taxes so fixed.
Immediately after fixing the rate of taxes the board shall transmit to the county auditors of the counties in which the district is situated a statement of the rate so fixed by it.
The county auditors shall compute and enter in the assessment rolls, the district tax on the property enumerated and assessed as being in the district, using the rate of levy fixed by the board, and the assessed value as found in the assessment rolls.
Taxes levied pursuant to Sections 16648 to 16653, inclusive, shall be collected at the same time and in the same manner as county taxes. When collected, the net amount, as provided in this article, shall be paid to the treasurer of the district, under the general requirements and penalties provided by law for the settlement of other taxes.
Each county auditor and tax collector shall annually file with the board of supervisors of his county itemized statements showing the additional expense to his office caused by performance of the duties imposed upon him by this article. Upon the filing of such statements the board of supervisors, by an order upon its minutes, shall deduct such expenses from the tax money of the district while in the hands of the tax collector and transfer the amount deducted into the county salary fund. Not more than one-half of 1 percent on the amount collected shall be so charged or deducted by any county.
The boards of supervisors may provide extra help for their county offices or officers as in their judgment is necessary for the proper performance of their duties under this article.
Whenever any real property situate in any district which has availed itself of county assessments has been sold for taxes and has been redeemed, the money paid for redemption shall be apportioned and paid by the county treasurer receiving it to the district, in the proportion which the tax due to the district bears to the total tax for which the property was sold.
District taxes are a lien on the property on which they are levied, except that if, during the year preceding the date on which the first installment of real property taxes which evidence the charges appears on the roll, any real property to which such lien would attach has been transferred or conveyed to a bona fide purchaser for value, or if a lien of a bona fide encumbrancer for value has been created and attaches thereon, then the lien which would otherwise be imposed by this section shall not attach to such real property and the costs of such charges relating to such property shall be transferred to the unsecured roll for collection. The enforcement of the collection of district taxes may be had in the same manner and by the same means as is provided by law for the enforcement of liens for county taxes.
Where a district has not availed itself of county assessments, delinquent property sold by the tax collector of the district for delinquent taxes shall be struck off by him to the district and shall thereafter be redeemed or disposed of as is provided by law in the case of delinquent property sold to the State for delinquent county taxes.
Notwithstanding any provision of this chapter to the contrary, in the case of a sale of property for taxes or assessments, except where the sale is conducted and the funds are accounted for as provided in Division 1 (commencing with Section 101) of the Revenue and Taxation Code, all proceeds shall be accounted for and distributed as provided in Article 12 (commencing with Section 53925) of Chapter 4 of Part 1 of Division 2 of Title 5 of the Government Code.
ARTICLE 9. Payment of Claims Against Districts [16681. - 16682.]
No claims shall be paid until allowed by the board, and only upon a warrant signed by any two officers.
CHAPTER 5. Acquisition of Works [16801. - 16885.]
ARTICLE 1. Petition to Acquire Works [16801. - 16817.]
As used in this chapter “acquisition of public utility works” includes construction, completion, or acquisition of public utilities or public utility works.
Whenever any petition signed by electors of the district equal in number to 15 percent of all votes cast within the district at the last preceding general election of state and county officers is presented to the board asking for the acquisition of public utility works therein named, the clerk shall immediately examine and verify the signatures and certify the result of the examination to the board. If the required number of signatures is found genuine, the clerk shall transmit to the president of the board an authentic copy of the petition, without the signatures thereto.
Upon receiving a petition certified to contain the required number of signatures, the board shall formulate for submission to the electors of the district at a general district election or at a special election called for that purpose a separate proposition for the acquisition of each public utility works named in the petition.
In the formulation of a proposition the board shall procure plans and estimates of the cost of original construction and completion by the district of the public utility or, in case of the proposed acquisition of an existing utility works, the cost of original construction and completion by the district of similar works. The board shall also procure an estimate of the revenues that can be expected from the public utility works named in the petition.
In securing estimates of the cost of original construction and completion of water works by the district, the board shall procure and place on file plans and estimates of the cost of obtaining from such sources as the board finds and designates as available a sufficient supply of good, pure water for the district.
Before submitting propositions to the electors for the acquisition of any public utility works, the board shall solicit and consider offers for the sale to the district of existing utilities, or utility works of the same character, or such portion thereof as would be useful to the district, in order that the district may have the benefit of acquiring them at the lowest possible cost.
The board may apply to the Public Utilities Commission to ascertain the value of existing utility works for the purpose of submitting to the electors estimates of the cost of acquiring them.
Upon application by the board the commission without delay shall make a valuation in accordance with Chapter 8, Part 1 of Division 1 of this code.
When the commission has made and filed its findings and decision, the board may have the findings reviewed in accordance with Chapter 8, Part 1 of Division 1, or the board may immediately adopt the findings and decision as the basis of its estimate of the cost of acquiring the public utility works by purchase or by condemnation.
Upon the filing of plans and estimates the board shall determine whether the cost of the public utility works proposed for acquisition can be paid from revenues of the district from the operation of its public utilities in addition to the other necessary expenses of the district.
When the cost of any public utility works named in a petition can be paid out of the revenues of the district derived from the operation of its public utilities, in addition to the other necessary expenses of the district, each proposition therefor submitted to the electors shall specify the cost of the public utility works proposed for acquisition by the district, the proposed method and manner of its payment, and the question whether the utility works shall be acquired upon such terms.
If the cost of any public utility works named in a petition so far exceeds the revenues of the district derived from the operation of its public utilities, in addition to the other necessary expenses of the district, that it is necessary to incur a district bonded indebtedness, each proposition shall specify the amount of the necessary bonded indebtedness, its rate of interest, and the question whether such bonded indebtedness shall be incurred.
At the next regular meeting after formulation of a proposition for the acquisition of the public utility works, the board by ordinance shall submit the proposition to the electors of the district at a general district election or at a special district election called for the purpose.
All propositions formulated pursuant to Section 16803 shall be submitted within six months after filing of the petitions, unless more time is required for obtaining a valuation requested of the Public Utilities Commission, in which case the propositions shall be submitted as soon as possible after the valuation becomes final.
The affirmative vote of a majority of the electors voting upon the proposition is necessary to accept a proposition submitted under Section 16811.
The affirmative vote of at least two-thirds of the electors voting upon the proposition is necessary to approve a proposition submitted under Section 16812 and to warrant the issuance of district bonds therefor.
At as early a date after determination of the election result as the board deems is for the best interests of the district, it shall undertake proceedings and enter into the negotiations and contracts necessary for the acquisition of the public utility works named in any proposition approved by the majority of the electors voting at the election.
ARTICLE 2. Resolution to Acquire Works [16841. - 16846.]
Whenever the board determines that the public interest or necessity of the district demands the acquisition of any public utility works, it shall specifically declare such determination by a resolution.
The board shall procure plans and estimates and negotiate for offers for the sale to the district of existing public utility works in the same manner as specified in Article 1 of this chapter.
When the cost of the public utility works can be paid out of the revenues of the district derived from the operation of its public utilities, in addition to the other necessary expenses of the district, as soon after the filing of the plans and estimates as the board deems is for the best interests of the district, it shall by ordinance determine to acquire such public utility works.
The ordinance shall be published pursuant to Section 6066 of the Government Code in some newspaper of general circulation printed and published in the district or, if there is no such newspaper in the district, in some newspaper of general circulation printed and published in the county where all or part of the district is situated. The ordinance shall state the proposed cost of the acquisition and the proposed method and manner of its payment. If the ordinance involves the expenditure of more than one hundred thousand dollars ($100,000), it shall not become effective until 30 days after its final passage.
If the cost of the public utility works so far exceeds the revenues of the district derived from the operation of its public utilities, in addition to the other necessary expenses of the district, that it is necessary to incur a district bonded indebtedness, the board, at a regular meeting held within 60 days after the filing of the plans and estimates of cost and expected revenue, by ordinance shall submit the proposition as to whether bonded indebtedness shall be incurred for acquisition of the public utility works, to the electors of the district at a general district election or at a special district election called for the purpose.
Propositions submitted pursuant to Section 16845 shall specify the amount of bonded indebtedness necessary for the acquisition of the public utility works, the rate of interest thereon, and the question whether the bonded indebtedness shall be incurred. The affirmative vote of at least two-thirds of the electors voting at the election upon the proposition is necessary to warrant the issuance of district bonds for the acquisition of any public utility works.
ARTICLE 3. Joint Acquisition and Use of Sewage Facilities and Water Works [16871. - 16885.]
As used in this article, “public agency” includes the Federal Government or any of its branches, and any county, city, district, or other public corporation.
As used in this article, “sewage disposal facilities” includes sewers or other works or facilities for the handling, treatment, or disposal of sewage.
A district may contract with any public agency or with any person, firm, or corporation, for the joint acquisition, construction, or use of any sewage disposal facilities for the servicing of the public utility district and such other area as may be designated in the contract, when in the judgment of the board it is for the best interests of the district so to do.
A contract may provide for the construction and maintenance of sewage disposal facilities, and for the payment by or for the parties to the contract of such proportionate part of the cost of their acquisition, construction, or maintenance as may be stated in the contract. The payments shall be made at such times and in such amounts as provided by the contract.
A contract may provide for the joint use of any sewage disposal facilities upon such terms and conditions as may be agreed upon by the parties to the contract, and for the flowage, treatment or disposal of sewage from such area for each of the parties as may be described in the contract.
A district which has acquired or constructed or which proposes to acquire or construct any sewage disposal facilities, may contract with any public agency or with any person, firm, or corporation for the use of any such sewage disposal facilities by any such public agency, or for the flowage, treatment, or disposal of sewage from any area designated by the person, firm, or corporation so contracting, upon such terms and conditions as may be provided in the contract.
Sections 16873 to 16876, inclusive, shall be liberally construed to the end that sewer systems may be planned for areas requiring sewers, which may not all be in one district, and that any sewage disposal facilities required or constructed by any public utility district may be used to the fullest capacity.
A district may contract with any public agency or with any person, firm, or corporation for the joint acquisition or construction or use of any water works or other facilities for supplying water to the public utility district or such other public agency and to such other area as may be designated in the contract, when in the judgment of the board of directors of the public utility district it is for the best interests of the district so to do.
A contract may provide for the construction and maintenance of water works or other facilities and for the payment by or for the parties to the contract of such proportionate part of the cost of the acquisition, construction, or maintenance of such water works or other facilities as may be stated in the contract. Payments shall be made at such time and in such amounts as provided by the contract.
A contract may provide for the joint use of any water works or other facilities upon such terms and conditions as may be agreed upon by the parties to the contract for such area for each of the parties as may be described in the contract.
A district which has acquired or constructed or which proposes to acquire or construct any water works or other facilities for supplying water to the district may contract with any public agency, or with any person, firm, or corporation for the use of any such water works or facilities by the public agency for the furnishing of water to any area designated by such public agency, person, firm, or corporation upon such terms and conditions as may be provided in the contract.
No agreement under Sections 16880 to 16883, inclusive, shall run for a longer period than 30 years; provided that in case bonds are issued to finance such waterworks, such agreement may be extended until such bonds are matured and redeemed. Any contract made with the federal government or any branch thereof is not subject to this restriction or limitation.
Sections 16880 to 16884, inclusive, shall be liberally construed to the end that water works and systems may be planned by public utility districts for areas requiring them which may not all be in one district and to the end that they may be used to the fullest capacity. Any contract or agreement made under these sections is not subject to the limitations provided in Section 16474, and such a contract or agreement made with the Federal Government, or any branch thereof, is not subject to the limitations provided in Section 16573.
CHAPTER 6. Bonds [17001. - 17009.]
District bonds shall be of such form and shall be redeemed at such times and in such amounts as the board may from time to time prescribe. However, the redemption of the bonds shall begin in not more than 15 years and shall be completed in not more than 75 years from the date of issue.
The bonds are payable, principal and interest, in lawful money of the United States.
The interest on the bonds, other than bonds for sewage works, shall not exceed 8 percent a year. The interest on bonds for sewage works shall not exceed 8 percent a year.
The bonds shall be issued in such denomination or denominations as the board may prescribe and may be sold by the board at such times and in such manner as it determines, but at not less than par and accrued interest.
District bonds have the same force, value, and use as bonds issued by a municipality.
The proceeds from the sale of bonds shall be placed in the treasury to the credit of the proper fund, and shall be applied exclusively to the purposes and objects mentioned in the ordinance authorizing their issue until such objects are fully accomplished, after which, if any surplus remains, the surplus may be transferred to the general fund, except that a surplus exceeding five thousand dollars ($5,000) shall be wholly transferred to the appropriate fund to pay interest and maintain the sinking fund, or provide for the retirement of the bonded indebtedness in connection with which the surplus remains.
The bonds shall be signed by the president of the board and countersigned by the clerk, and shall have the seal of the district attached. The coupons shall be numbered consecutively and signed by the treasurer, by original or facsimile signature, and the bonds and coupons shall be payable at the office of the treasurer.
Notwithstanding the fact that an officer whose signature, countersignature, or attestation appears on any bonds or coupons thereof ceases to be such officer before the sale or delivery of such bonds, his signature, countersignature, or attestation appearing either on the bonds or the coupons, or on both, is valid and sufficient for all purposes the same as if he had remained in office until the sale or delivery of the bonds.
In determining the amount of bonds to be issued, the legislative body may include:
All costs and estimated costs incidental to or connected with the acquisition, construction, improving or financing of the project.
All engineering, inspection, legal and fiscal agent’s fees, costs of the bond election and of the issuance of said bonds, bond reserve funds and working capital and bond interest estimated to accrue during the construction period and for a period of not to exceed 12 months after completion of construction.
CHAPTER 6.5. Adoption of Improvement Acts [17010. - 17013.]
Whenever, in the opinion of the board, the public interest or convenience may require, it may order to be done in, under, or upon the whole or any portion of any one or more of the streets or public places of the district, or any property or rights-of-way owned by the district, any work or improvement which the district is authorized to do and provide that the cost thereof shall be assessed upon the lots and lands fronting on the streets or public places, or upon any district which may be assessed therefor, and which need not be composed of lands contiguous to each other. The Improvement Act of 1911, the Municipal Improvement Act of 1913, and the Improvement Bond Act of 1915, as now or hereafter provided, are applicable to districts.
In the application of said acts to proceedings under this section the terms used in said acts shall have the following meanings:
“City council” and “council” mean board;
“City” and “municipality” mean district;
“Clerk” and “city clerk” mean secretary;
“Superintendent of streets” and “street superintendent” and “city engineer” mean the engineer of the district, or any other person appointed to perform such duties;
“Tax collector” means county tax collector;
“Treasurer” and “city treasurer” mean the treasurer of the public utility district, unless the district elects to use the county treasurer as provided in Section 16036, in which case it is the county treasurer as ex officio treasurer of the district;
“Right-of-way” means any parcel of land in, on, under or through which a right-of-way or easement has been granted to the district for the purpose of constructing or maintaining or work or improvements which the district is authorized to do.
The powers and duties conferred by said acts and supplementary acts upon boards, officers, and agents of cities shall be exercised by the board, officers, and agents of the district, respectively.
The improvements authorized to be constructed or acquired by this chapter are restricted to those permitted to be constructed or acquired pursuant to this division.
CHAPTER 7. Validating Proceedings [17101. - 17101.]
An action to determine the validity of bonds or indebtedness, authorized for the acquisition, construction, or completion of any public utility or public utility works, may be brought pursuant to Chapter 9 (commencing with Section 860) of Title 10 of Part 2 of the Code of Civil Procedure. For such purpose an indebtedness shall be deemed to be in existence upon its authorization.
CHAPTER 8. Annexation [17301. - 17381.]
ARTICLE 1. Annexation of Unincorporated Territory [17301. - 17302.]
Unincorporated territory contiguous or noncontiguous to a district may be annexed to the district in the manner provided in the District Reorganization Act of 1965 (commencing with Section 56000 of the Government Code).
Any district in the Lake Tahoe Basin which is able to provide to incorporated territory contiguous to such district a sewer system and treatment facilities sufficient to handle and treat any resultant sewage and provide transportation facilities sufficient to transport any resultant sewage effluent outside the Lake Tahoe Basin may annex such territory in the manner provided in the District Reorganization Act of 1965 unless the city of which such territory is a part provides or has undertaken to provide such sewer system, treatment and transportation facilities.
ARTICLE 2. Annexation of Noncontiguous Territory [17360. - 17381.]
As used in this article, “petitioning district” means any public utility district, water district, or irrigation district containing land which is to be annexed to a public utility district.
As used in this article, “annexing district” means any public utility district to which land is to be annexed.
Land not a part of and not contiguous to any district, containing at least 10 privately owned acres, and lying within the exterior boundaries of any petitioning district, the nearest boundary of which is within three miles of the nearest boundary of the annexing district may be annexed to the annexing district in the manner provided in this article or in the District Reorganization Act of 1965 (commencing at Section 56000, Government Code). When proceedings for such annexation are taken pursuant to this article, only the provisions of this article shall apply thereto.
The board of directors or other governing body of the petitioning district may request by petition that lands lying within its boundaries and described in the petition be annexed to the annexing district upon such terms and conditions as are set forth in the petition.
The petition shall be addressed to the board of directors of the annexing district and filed with the secretary of the annexing district.
The execution and filing of the petition by the petitioning district shall be authorized by resolution of its board of directors and a certified copy of the resolution shall be filed with the petition.
If the board of directors of the annexing district determines that the annexation of the territory will facilitate the acquisition, construction, completion, or operation of any public utilities works of the petitioning district, or the annexing district, and will not operate to the disadvantage of the annexing district, and that the territory proposed to be annexed will be benefited by the annexation, it shall determine the terms and conditions upon which the annexation shall be made.
In the terms and conditions, the board may provide for any of the following:
That the territory to be annexed shall not become liable by assessment or otherwise (1) for any of the outstanding obligations of the annexing district; (2) for any expense incurred in acquiring property used or to be used for the servicing of any land within the exterior boundaries of the annexing district as they then exist; (3) for any costs or charges incurred in connection with the replacement or construction of any utility system or for the delivery of any commodity or service within the annexing district.
That the land to be annexed shall be subject to such assessments and charges as required to provide (1) for any utility system or property necessary to serve the annexed land; (2) for the costs of maintaining, servicing, and operating such properties.
That the liability of the land to be annexed may be limited solely to the fixing and collecting of charges for utilities or commodities actually supplied to the petitioning district by the annexing district.
The terms and conditions may also provide for any of the following:
That any and all property, services, or commodities may be delivered directly to the petitioning district.
That the annexation may be made contingent upon the annexing district obtaining the necessary approval for the annexing of such lands from any and all agencies, authorities, and districts of which the annexing district may be a member.
That the annexed territory may be required to waive and will not be entitled to receive, use, or participate in any services, commodities, or property or some specific part thereof which may be owned by the annexing district, or to which it may be entitled.
Any other terms and conditions authorized by the District Reorganization Act of 1965 (commencing at Section 56000, Government Code).
The terms and conditions shall become effective and binding upon the annexing district and upon the territory to be annexed and the petitioning district when approved in the manner provided in this article.
The resolution of the board of directors of the annexing district shall describe the territory proposed to be annexed and set forth the terms and conditions at length upon which the annexation is proposed to be made, and declare the board’s intention of approving such annexation upon the terms and conditions therein specified.
After the board of directors of the annexing district shall have adopted a resolution declaring its intention of approving an annexation the secretary of such district shall file a certified copy of such resolution with the executive officer of the local agency formation commission.
After said resolution has been filed with the executive officer, proceedings thereon shall be taken by the local agency formation commission in the manner and subject to the provisions of Part 4 (commencing at Section 56250, Government Code) of the District Reorganization Act of 1965. If the resolution and proposed annexation are approved by the commission, with or without amendment, wholly, partially or conditionally, it shall be mandatory for the board of directors of the annexing district to complete the proceedings for such annexation, subject to compliance with the commission’s resolution making determinations.
After receipt of the resolution of the local agency formation commission making determinations, the board of directors of the annexing district shall cause publication of its resolution declaring its intention of approving such annexation and a notice fixing the time and place of hearing thereon and notifying all persons interested in or that may be affected by the proposed annexation of territory to appear at the meeting and show cause in writing, if any they have, why the territory or any part of it should not be annexed as proposed in the resolution. The notice and resolution shall be published pursuant to Section 6061 of the Government Code in a newspaper of general circulation printed and published in the annexing district, or if there is no such newspaper, in a newspaper of general circulation printed and published in the county where all or a part of the annexing district is situated.
The time fixed for hearing shall not be less than 20 days nor more than 60 days after the date of the first publication of the resolution, and the notice and resolution shall be posted in three public places in the territory proposed to be annexed at least 15 days before the date set for the hearing.
At the hearing or any continuance thereof, the board of directors of the annexing district shall hear all relevant evidence and shall determine whether the territory shall be annexed and upon what terms and conditions, if any, such annexation shall be made.
At the hearing or any prior time, any person interested may file with the board of directors of the annexing district a written protest to the proposed annexation or to the approval of the terms and conditions.
If written protests are filed by the owners of taxable property in the territory proposed to be annexed, the board of directors shall refer the protests to the board of supervisors of the county in which the district is situated. The board of supervisors shall thereupon hold a hearing on the protests after notice given in the manner provided in Article 2, Chapter 2 of this division.
If the board of supervisors finds and determines at the hearing that the property described in the protests will not be substantially benefited by annexation to the district, it may notify the board of directors of the annexing district that such property shall not be annexed to the district, and the board of directors shall take the necessary steps to exclude the property from the territory proposed to be annexed.
Any person who is interested in any land located within the annexing district or the territory to be annexed and who does not file a written protest is deemed to have assented to the annexation of the territory set forth in the petition of the petitioning district, and upon the terms and conditions set forth therein.
After the hearing, the board of directors of the annexing district may adopt a resolution ordering and approving the annexation.
The annexing board shall by resolution describe the territory ordered to be annexed, and set forth the boundaries of the district as they will exist after the annexation. The order shall also set forth in detail the terms and conditions, if any, of the annexation; and if the annexation is for limited purposes only, the land which is being annexed shall be described as one parcel and the land of the annexing district shall be described as a separate and distinct parcel.
After adoption of the resolution ordering the annexation, the secretary of the annexing district shall make the filings provided for in Chapter 8 (commencing at Section 56450, Government Code) of Part 5 of the District Reorganization Act of 1965. A certified copy of the resolution provided for by Section 17379 shall accompany and be made a part of such filings. The annexation shall be completed and effective on the dates specified in said Chapter 8.
The inclusion in, or annexation or addition to, a public utility district of the corporate area of any public corporation or public agency shall not destroy the identity or legal existence or impair the powers of any such public corporation or public agency, notwithstanding the identity of purpose, or substantial identity of purpose, of such public utility district.
CHAPTER 9. Exclusion of Territory [17501. - 17501.]
Any territory within a district which is not benefited in any manner by the district or its continued inclusion therein may be excluded from the district by proceedings under and pursuant to the District Reorganization Act of 1965 (commencing at Section 56000, Government Code).
CHAPTER 11. Zones in Districts in Lake Tahoe Basin [18050. - 18055.]
Notwithstanding any other provision of law, any public utility district in the Lake Tahoe Basin which has provided or undertaken to provide a sewer system and treatment facilities which transport or are intended to transport any resultant sewage effluent outside the Lake Tahoe Basin, may form zones and issue zone bonds for the purpose of financing the costs of interceptor trunk sewers, force mains, pumping stations and appurtenant structures in the zone which, in the opinion of its board of directors, are necessary or useful in connecting local sewerage collection systems to the major sewerage works and system of the district, or which are necessary or useful in causing local areas to install sewerage collection systems, as provided in this chapter.
The zones authorized by this chapter shall be formed in the same manner as assessment districts are formed pursuant to the Municipal Improvement Act of 1913 (Division 12 (commencing with Section 10000), Streets and Highways Code).
The resolution of intention to form a zone shall briefly describe the proposed improvement, specify the exterior boundaries of the zone, and specify the maximum amount of zone bonds to be issued to finance the proposed improvement.
Upon the conclusion of the hearing on the resolution of intention and the adoption of the resolution declaring the zone formed, the board of directors of the district may proceed with the issuance of zone bonds, not exceeding the amount specified in the resolution of intention, and with the construction of the proposed improvement. The board may exercise any and all powers of the district in the zone necessary to construct the proposed improvement.
The board shall formulate the proposition to issue zone bonds and shall conduct an election in the zone affected in the same manner as for bonds of the district pursuant to Article 1 (commencing with Section 16801), Chapter 5 of this division. An affirmative vote of two-thirds of the electors voting in the zone is necessary to issue zone bonds.
Bonds of a zone formed pursuant to this chapter shall be issued in the amount of the costs of the improvements of the zone, notwithstanding Section 16573, payable in 25 or less serial annual amounts, and shall be in the same form, payable in the same manner, and be of the same effect as bonds of the district issued pursuant to Chapter 6 (commencing with Section 17001) of this division.
The board shall annually, at the time of levying taxes for general district purposes, fix a rate of ad valorem tax upon the taxable real property in the zone created therefor, sufficient to pay the zone bond principal and interest as they become due before the proceeds of another such levy shall be available therefor, and such tax shall be levied, collected and money collected therefrom shall be expended to pay zone bonds principal and interest, in the same manner and with the same effect as taxes levied to pay bonds of the district pursuant to Article 8 (commencing with Section 16641), Chapter 4 of this division.
The Legislature hereby finds and declares that special facts exist with respect to public utility districts in the Lake Tahoe Basin which require the enactment of this chapter, applicable only to such districts. The special facts are as follows:
There is an urgent need for immediate action in providing an adequate system of sewer treatment and export facilities in order to prevent the pollution of the waters of Lake Tahoe.
There are areas in these districts which are and will continue to be required to install sewerage collection systems which cannot now be connected to the major sewerage works and system of the districts.
All areas of these districts are being required to connect to and use the works and system of the districts where they are available to them, but there is no economical means of providing the necessary intervening facilities which will be inviting to the owners of said areas to provide said facilities.
The procedure provided in this chapter will stimulate and engender said purpose and thus help to bring about an early solution to the Lake Tahoe water pollution problem.
DIVISION 9. AVIATION [21001. - 24451.]
PART 1. STATE AERONAUTICS ACT [21001. - 21712.]
CHAPTER 1. General Provisions and Definitions [21001. - 21020.]
This part may be cited as the “State Aeronautics Act.”
The purpose of this part is to further and protect the public interest in aeronautics and aeronautical progress by the following means:
Encouraging the development of private flying and the general use of air transportation.
Fostering and promoting safety in aeronautics.
Effecting uniformity of the laws and regulations relating to aeronautics consistent with federal aeronautics laws and regulations.
Granting to a state agency powers, and imposing upon it duties, so that the state may properly perform its functions relative to aeronautics and effectively exercise its jurisdiction over persons and property, assist in the development of a statewide system of airports, encourage the flow of private capital into aviation facilities, and cooperate with and assist political subdivisions and others engaged in aeronautics in the development and encouragement of aeronautics.
Establishing only those regulations which are essential and clearly within the scope of the authority granted by the Legislature, in order that persons may engage in every phase of aeronautics with the least possible restriction consistent with the safety and the rights of others.
Providing for cooperation with the federal authorities in the development of a national system of civil aviation and for coordination of the aeronautical activities of those authorities and the authorities of this state.
Assuring that persons residing in the vicinity of airports are protected to the greatest possible extent against intrusions by unreasonable levels of aircraft noise.
Fostering and promoting the development of a stable and efficient regional air carrier system to provide access for small and rural communities to the national air transportation system consistent with federal policies favoring deregulation.
Developing, in cooperation with the private sector, airport management, local jurisdictions, federal authorities, and the general public, informational programs to increase the understanding of current air transportation issues including, but not limited to, aviation safety, planning, airport noise, airport development and management, and the role of aviation in the economic development of the state, as an integral part of the state’s transportation system.
Sponsoring or cosponsoring, with representatives of the aerospace and aviation industry, aviation educational and informational seminars which meet the needs of pilots and other members of the industry for current information on aviation safety, planning, and airport development and management.
Unless the context otherwise requires, the definitions and general provisions set forth in this chapter govern the construction of this part.
The acquisition of any land or interest therein pursuant to this part, the planning, acquisition, establishment, construction, improvement, maintenance, equipment, and operation of airports and air navigation facilities, whether by the state separately or jointly with any political subdivision, and the exercise of any other powers granted to the department by this part are public and governmental functions, exercised for a public purpose, and are matters of public necessity. All land and other property and privileges acquired and used by or on behalf of the state pursuant to this part are acquired and used for public and governmental purposes as a matter of public necessity.
This part shall not be construed as limiting any power of the state or a political subdivision to regulate airport hazards by zoning.
This chapter or any other law shall not be construed as prohibiting, restricting, or permitting the prohibition of the operation or landing in populated areas of helicopters and similar aircraft capable of approximately vertical ascent and descent, subject to such reasonable rules affecting the public safety as the department may promulgate. The department shall adopt rules and regulations, effective January 1, 1989, for the conditions under which helicopters may make temporary use of a landing site.
“Department” means the Department of Transportation.
Whenever the term “California Aeronautics Commission,” “Division of Aeronautics,” or “Department of Aeronautics” is used in any other law, it means the Department of Transportation.
“Director” means the Director of Transportation.
Any reference in any law or regulation to the Director of Aeronautics shall be deemed to refer to the Director of Transportation.
“Division” means the Division of Aeronautics in the department.
“Commission” means the California Transportation Commission.
“Person” means any individual, firm, partnership, corporation, limited liability company, company, association, joint stock association, or body politic; and includes any trustee, receiver, assignee, or other similar representative.
“Political subdivision” means any county, city, city and county, public corporation, district or other political entity or public corporation of this State.
“Aeronautics” means:
The science and art of flight, including transportation by aircraft.
The operation, construction, repair, or maintenance of aircraft and aircraft power plants and accessories, including the repair, packing, and maintenance of parachutes.
The design, establishment, construction, extension, operation, improvement, repair, or maintenance of airports or other air navigation facilities.
“Aircraft” means any manned contrivance used or designed for navigation of, or flight in, the air requiring certification and registration as prescribed by federal statute or regulation. Notwithstanding the foregoing provisions of this section, manned lighter-than-air balloons and ultralight vehicles as defined in the regulations of the Federal Aviation Administration (14 C.F.R. Part 103), whether or not certificated by the Federal Aviation Administration, shall not be considered to be aircraft for purposes of this part.
“Airport” means any area of land or water which is used, or intended for use, for the landing and take-off of aircraft, and any appurtenant areas which are used, or intended for use, for airport buildings or other airport facilities or rights of way, and all airport buildings and facilities located thereon.
“Air navigation facility” means any facility, other than facilities owned or operated by the United States, used, or available or designed for use, in aid of air navigation, including any structures, mechanisms, lights, beacons, markers, communicating systems, or other facilities used or useful as an aid, or constituting an advantage or convenience, to the safe taking off, navigation, and landing of aircraft, or the safe and efficient operation or maintenance of an airport.
“Operation of aircraft” or “operate aircraft” means the use, navigation, or piloting of aircraft in the air space over this State or upon any airport within this State.
“Airman” means any individual who engages, as the person in command, or as pilot, mechanic, or member of the crew, in the navigation of aircraft while under way, and any individual who is directly in charge of the inspection, maintenance, overhauling, or repair of aircraft engines, propellers, or appliances, and any individual who serves in the capacity of aircraft dispatcher, or air traffic control-tower operator. “Airman” does not include any individual employed outside the United States, or any individual employed by a manufacturer of aircraft, aircraft engines, propellers, or appliances to perform duties as inspector or mechanic in connection therewith, or any individual performing inspection or mechanical duties in connection with aircraft owned or operated by him.
“Airport hazard” means any structure, object of natural growth, or use of land, which obstructs the air space required for flight of aircraft in landing or taking off at an airport or which is otherwise hazardous to the landing or taking off.
“Airway” means a route in the navigable air space over the land or waters of this State, designated by proper authority as a route suitable for air navigation.
“Land” includes tide and submerged lands or other lands subject to the public trust for commerce, navigation, or fisheries.
CHAPTER 2. Department of Transportation and State Aeronautics Board [21204. - 21258.]
ARTICLE 1. Department of Transportation [21204. - 21207.]
The department may adopt, administer, and enforce rules and regulations for the administration of this part.
The department shall prepare a statement of all estimated revenues of the Aeronautics Account in the State Transportation Fund and revenues available for local subventions from any other sources for the next succeeding fiscal year, together with a statement of proposed expenditures to be made to local agencies and the University of California during the next succeeding fiscal year, or obligations to be incurred in connection therewith.
The statement shall be included in the printed fiscal year budget submitted to the Legislature. Insofar as the matters to which it pertains, it shall constitute as submitted the budget submitted to the Department of Finance pursuant to Section 13320 of the Government Code, and, as to such matters, shall be administered by the Department of Finance as the fiscal year budget of the Department of Transportation under the provisions of this section and of Article 2 (commencing with Section 13320) of Chapter 3 of Part 3 of Division 3 of Title 2 of the Government Code.
Any changes or modifications in the budget described in this section shall be approved by the Director of Finance.
In the event, during an annual period, the budgetary amount approved and allocated for any purpose exceeds the amount actually necessary therefor, with a resultant available surplus, such surplus may be allocated to any other purpose or supplemental project upon the written approval of the Director of Finance.
In administering the budget, the Director of Finance shall not limit expenditures or incurrence of obligations thereunder to quarterly, semiannual, or other periods of the fiscal year.
Whenever a political subdivision owning and operating an airport constructs or implements a noise mitigation project at the airport, including, but not limited to, the installation of noise monitoring equipment at any time after the project has been included within the aeronautics program in the state transportation improvement program and prior to funding of the project, the department shall, when funding for the project becomes available, reimburse the political subdivision for the eligible costs of the project, without interest, not to exceed the amount of the funds made available to the department or the political subdivision’s actual eligible costs, whichever is lower. Reimbursement under this section shall be made only if the political subdivision completes the project to the standards approved by the department including, but not limited to, bidding and contracting procedures and the project is approved by the commission. This section does not apply to any project for which state funding is not specifically made available.
ARTICLE 1.5. State Aeronautics Board [21215. - 21216.]
The State Aeronautics Board is hereby abolished, and the California Transportation Commission succeeds to, and is vested with, all the duties, powers, purposes, responsibilities, and jurisdiction vested in the State Aeronautics Board.
Any reference in any law or regulation to the State Aeronautics Board shall be deemed to refer to the California Transportation Commission.
The California Transportation Commission shall have the possession and control of all licenses, permits, leases, agreements, contracts, orders, claims, judgments, records, papers, equipment, supplies, bonds, moneys, funds, appropriations, buildings, land and other property, real or personal, held for the benefit, use, or obligation of the State Aeronautics Board.
Any person or entity injured or aggrieved by any procedure or action of the department with respect to aeronautics may appeal to the California Transportation Commission for relief, and the decision of the commission as to such matter shall, after hearing thereon, be conclusive, subject to such review as may be otherwise provided by law. This section shall not apply to any procedure or action for which a hearing pursuant to Chapter 5 (commencing with Section 11500) of Part 1 of Division 3 of Title 2 of the Government Code is specified in this part as the means for reviewing or finalizing the procedure or action.
ARTICLE 2. Powers and Duties [21240. - 21258.]
This state recognizes the authority of the federal government to regulate the operation of aircraft and to control the use of the airways, and nothing in this act shall be construed to give the department the power to so regulate and control safety factors in the operation of aircraft or to control use of the airways. This section does not affect the state’s power to regulate the intrastate rates of common carriers by air, and such power is hereby reserved to the state.
The department shall encourage, foster, and assist in the development of aeronautics in this state and encourage the establishment of airports and air navigation facilities. It shall cooperate with and assist the federal government, political subdivisions of this state, and others in the development of aeronautics, and shall seek to coordinate their aeronautical activities.
Political subdivisions may cooperate with the department in the development of aeronautics and aeronautics facilities in this state.
The department may:
Draft and recommend necessary legislation to advance the interest of the state in aeronautics.
Represent the state in aeronautical matters before federal and other agencies.
Participate as plaintiff or defendant or as intervenor on behalf of the state or any political subdivision or citizen in any controversy which involves the interest of the state in aeronautics.
Assist political subdivisions and their law enforcement agencies in becoming acquainted with and enforcing the civil air regulations.
The department may make and amend general or special rules, regulations, and procedures and establish minimum standards, consistent with and clearly within the scope of federal legislation governing aeronautics and the rules, regulations, and standards issued thereunder. The department may, by regulation, classify airports into several reasonable classes or groups according to their facilities and the types and number of aircraft which they are capable of handling and may make and amend rules, regulations, and procedures and establish minimum standards for each separate class or group.
For the purpose of protecting and insuring the general public interest and safety and the safety of persons operating, using, or traveling in aircraft and developing aeronautics in this state, and after appropriate public hearings, the department may make and amend temporary general or special rules and procedures and establish temporary minimum standards consistent with this part as it deems necessary to administer this part. The department shall draft these temporary rules, procedures, and standards in the form of proposed aviation law and shall submit them to the next general session of the Legislature. These temporary rules, procedures, and standards shall not remain in effect beyond 90 days after the final adjournment of that session of the Legislature.
The department shall keep on file with the Secretary of State, and at its principal office, a copy of all its rules for public inspection.
The department shall provide for the publication and general distribution of all its orders, rules, and procedures having general effect.
The department may enter into any contracts necessary to the execution of its powers under this part. All contracts made by the department, either as the agent of the state or as the agent of any political subdivision, shall be made pursuant to the laws of the state governing the making of like contracts. Where the planning, acquisition, construction, improvement, maintenance, or operation of any airport or air navigation facility is financed wholly or partially with federal money the department, as agent of the state or of any political subdivision, may let contracts in the manner prescribed by the federal authorities acting under the laws of the United States and any rules made thereunder.
The department may exercise any of its powers under this part jointly with any political subdivision, state agency, other states or their political subdivisions, or the United States.
The department may confer or hold joint hearings with any federal agency in connection with any matter arising under this part or relating to the sound development of aeronautics.
The department may avail itself of the cooperation, services, records, and facilities of the federal agencies in the administration and enforcement of this part. It shall cooperate with and make available to the federal agencies, its services, records, and facilities, insofar as practicable.
In administering this part the department may use the facilities and services of other state agencies and political subdivisions to the utmost extent possible. These agencies and political subdivisions shall make available to the department their facilities and services.
The department, its members, the director, officers and employees of the department, and every state and peace officer charged with the enforcement of state and subordinate laws or ordinances, may enforce and assist in the enforcement of this part, the rules and orders issued under this part, and all other laws of this state relating to aeronautics. In the enforcement of these rules, orders, and laws, the director, and any officers and employees as the director may designate, shall have the authority, as public officers, to arrest without a warrant, any person who, in his presence, has violated, or as to whom there is probable cause to believe has violated, any of the rules, orders, or laws.
In any case in which an arrest authorized by this subdivision is made for an offense declared to be a misdemeanor, and the person arrested does not demand to be taken before a magistrate, the arresting officer may, instead of taking that person before a magistrate, follow the procedure prescribed by Chapter 5C (commencing with Section 853.5) of Title 3 of Part 2 of the Penal Code. The provisions of that chapter shall thereafter apply with reference to any proceeding based upon the issuance of a citation pursuant to this authority.
There shall not be civil liability on the part of, and a cause of action shall not arise against, any person, acting pursuant to subdivision (a) and within the scope of his authority, for false arrest or false imprisonment arising out of any arrest that is lawful or for which the arresting officer, at the time of the arrest, had reasonable cause to believe was lawful. The officer shall not be deemed an aggressor or lose his right to self-defense by the use of reasonable force to effect the arrest or to prevent escape or to overcome resistance.
The director, and any officers and employees as the director may designate, may serve all processes and notices throughout the state.
In the name of the state, the department may enforce this part and rules and orders issued under this part by injunction or other legal process in the courts of this state.
The department may report to the appropriate federal agencies and agencies of other states all proceedings instituted charging violations of Section 21407, and Sections 21409 to 21412, inclusive, and all penalties of which it has knowledge imposed upon airmen or the owners or operators of aircraft for violations of the law of this state relating to aeronautics or for violations of the rules or orders of the department.
The department may receive reports of penalties and other data from agencies of the federal government and other states, and may enter into agreements with these agencies governing the delivery, receipt, exchange, and use of reports and data. The department may make the reports and data of these agencies and of the courts of this state available to any court of this state and to any officer of the state or of any political subdivision authorized to enforce the aeronautics laws by Section 21252.
The department may accept, receive, receipt for, disburse, and expend federal and other money, public or private, made available to accomplish in whole or in part any of the purposes of this part. All federal money accepted under this part shall be accepted and expended by the department upon the terms and conditions prescribed by the United States. In accepting federal money under this part, the department shall have the same authority to enter into contracts on behalf of the state as is granted to the department under Section 21603. The department shall deposit all money received under this section in the Special Deposit Fund in the State Treasury, to be disbursed or expended in accordance with the terms and conditions upon which it was made available.
The department may own and operate aircraft for use in the furtherance of its duties, employ airmen and mechanics for proper operation and maintenance of the aircraft, and insure its employees against injury or death arising from aircraft accidents incurred in the performance of their assigned duties, within the limits of appropriations for these purposes.
The department shall represent the state and local agencies before the Civil Aeronautics Board and other federal agencies in all matters related to the Airline Deregulation Act of 1978 (P.L. 95-504, as amended) and the essential air service program created by that act. The department shall assist and cooperate with federal, state, and local agencies and private entities in the development of a stable and efficient regional air carrier system.
CHAPTER 3. Regulation of Aeronautics [21401. - 21416.]
Sovereignty in the space above the land and waters of this state rests in the state, except where granted to and assumed by the United States pursuant to a constitutional grant from the people of the state.
The operation of aircraft in such space is a privilege subject to the laws of this state.
The ownership of the space above the land and waters of this State is vested in the several owners of the surface beneath, subject to the right of flight described in Section 21403. No use shall be made of such airspace which would interfere with such right of flight; provided, that any use of property in conformity with an original zone of approach of an airport shall not be rendered unlawful by reason of a change in such zone of approach.
Flight in aircraft over the land and waters of this state is lawful, unless at altitudes below those prescribed by federal authority, or unless conducted so as to be imminently dangerous to persons or property lawfully on the land or water beneath. The landing of an aircraft on the land or waters of another, without his or her consent, is unlawful except in the case of a forced landing or pursuant to Section 21662.1. The owner, lessee, or operator of the aircraft is liable, as provided by law, for damages caused by a forced landing.
The landing, takeoff, or taxiing of an aircraft on a public freeway, highway, road, or street is unlawful except in the following cases:
A forced landing.
A landing during a natural disaster or other public emergency if the landing has received prior approval from the public agency having primary jurisdiction over traffic upon the freeway, highway, road, or street.
When the landing, takeoff, or taxiing has received prior approval from the public agency having primary jurisdiction over traffic upon the freeway, highway, road or street.
The prosecution bears the burden of proving that none of the exceptions apply to the act which is alleged to be unlawful.
The right of flight in aircraft includes the right of safe access to public airports, which includes the right of flight within the zone of approach of any public airport without restriction or hazard. The zone of approach of an airport shall conform to the specifications of Part 77 of the Federal Aviation Regulations of the Federal Aviation Administration, Department of Transportation.
Liability of the owner or pilot of an aircraft carrying passengers for injury or death to the passengers is determined by the rules of law applicable to torts on the land or waters of this state, arising out of similar relationships. Every owner of an aircraft is liable and responsible for death or injury to person or property resulting from a negligent or wrongful act or omission in the operation of the aircraft, in the business of the owner or otherwise, by any person using or operating the same with the permission, express or implied, of the owner.
The liability of an owner, bailee of an owner, or personal representative of a decedent imposed by Section 21404 and not arising through the relationship of principal and agent or master and servant is limited to the amount of fifteen thousand dollars ($15,000) for the death of or injury to one person in any one accident and, subject to the limit as to one person, is limited to the amount of thirty thousand dollars ($30,000) for the death of or injury to more than one person in any one accident and is limited to the amount of five thousand dollars ($5,000) for damage to property of others in any one accident.
An owner, bailee of an owner, or personal representative of a decedent is not liable under this section for damages imposed for the sake of example and by way of punishing the operator of the aircraft. Nothing in this subdivision makes an owner, bailee of an owner, or personal representative immune from liability for damages imposed for the sake of example and by way of punishing him for his own wrongful conduct.
The liability of the owner of one aircraft to the owner of another aircraft, or to operators or passengers on either aircraft, for damage caused by collision on land or in the air, is determined by the rules of law applicable to torts on land.
It is unlawful for any person to operate an aircraft in the air, or on the ground or water in a careless or reckless manner so as to endanger the life or property of another. In any proceeding charging operation of aircraft in violation of this section, the court in determining whether the operation was careless or reckless shall consider the standards for safe operation of aircraft prescribed by federal statutes or regulations governing aeronautics.
It is unlawful for any person, who is under the influence of an alcoholic beverage or any drug, or the combined influence of an alcoholic beverage and any drug, to operate an aircraft in the air, or on the ground or water, or to engage in parachuting for sport.
No person shall operate an aircraft in the air or on the ground or water who has 0.04 percent or more, by weight, of alcohol in his or her blood.
Any person who operates an aircraft in the air or on the ground or water is deemed to have given his or her consent to chemical testing of his or her blood or breath for the purpose of determining the alcoholic content of his or her blood, if lawfully arrested for any offense allegedly committed in violation of Section 21407.1 or if the officer requests chemical testing as part of any investigation of a suspected violation of state or local law. If a blood or breath test, or both, are unavailable, then paragraph (2) of subdivision (d) applies.
Any person who operates an aircraft in the air or on the ground or water is deemed to have given his or her consent to chemical testing of his or her blood or urine for the purpose of determining the drug content of his or her blood, if lawfully arrested for any offense allegedly committed in violation of Section 21407.1 or if the officer requests chemical testing as part of an investigation of a suspected violation of state or local law.
The testing shall be administered at the direction of a peace officer having reasonable cause to believe the person was operating an aircraft in violation of Section 21407.1 under either of the following conditions:
The person is lawfully arrested.
The officer requests the person to submit to chemical testing as part of an investigation of a suspected violation of state or local law.
The person shall be told that his or her failure to submit to, or the failure to complete, the required chemical testing may result in prohibition from operating an aircraft for not more than one year and, if the person is convicted of a violation of Section 21407.1, a fine, imprisonment, prohibition from operating an aircraft for not more than one year, or any combination thereof.
If the person is lawfully arrested for operating an aircraft under the influence of an alcoholic beverage, the person has the choice of whether the test shall be of his or her blood or breath, and the officer shall advise the person that he or she has that choice. If the person arrested either is incapable, or states that he or she is incapable, of completing the chosen test, the person shall submit to the remaining test. If a blood or breath test, or both, are unavailable, then paragraph (2) of subdivision (d) applies.
If the person is lawfully arrested for operating an aircraft under the influence of any drug or the combined influence of an alcoholic beverage and any drug, the person has the choice of whether the test shall be of his or her blood, breath, or urine, and the officer shall advise the person that he or she has that choice.
A person who chooses to submit to a breath test may also be requested to submit to a blood or urine test if the officer has reasonable cause to believe that the person was operating an aircraft under the influence of any drug or the combined influence of an alcoholic beverage and any drug and if the officer has a clear indication that a blood or urine test will reveal evidence of the person being under the influence. The officer shall state in his or her report the facts upon which that belief and that clear indication are based. If the person who is arrested is either incapable or states that he or she is incapable of completing a blood test, that person shall submit to and complete a urine test. If the person arrested either is incapable, or states that he or she is incapable, of completing either chosen test, the person shall submit to and complete the other remaining test.
If the person is lawfully arrested for an offense allegedly committed in violation of Section 21407.1 and, because of the need for medical treatment, the person is first transported to a medical facility where it is not feasible to administer a particular test of, or to obtain a particular sample of, the person’s blood, breath, or urine, the person has the choice of those tests which are available at the facility to which that person has been transported. In that event, the officer shall advise the person of those tests which are available at the medical facility and that the person’s choice is limited to those tests which are available.
The officer shall also advise the person that he or she does not have the right to have an attorney present before stating whether he or she will submit to a test or tests, before deciding which test or tests to take, or during administration of the test or tests chosen, and that, in the event of refusal to submit to a test or tests, the refusal may be used against him or her in a court of law.
Any person who is unconscious or otherwise in a condition rendering him or her incapable of refusal is deemed not to have withdrawn his or her consent and a test or tests may be administered whether or not the person is told that his or her failure to submit to, or the noncompletion of, the test or tests may result in a fine, imprisonment, and prohibition from operating an aircraft for not more than one year. Any person who is dead is deemed not to have withdrawn his or her consent and a test or tests may be administered at the direction of a peace officer.
Any person who is afflicted with hemophilia is exempt from the blood test required by this section.
Any person who is afflicted with a heart condition and is using an anticoagulant under the direction of a licensed physician and surgeon is exempt from the blood test required by this section.
A person lawfully arrested for any offense allegedly committed while the person was operating an aircraft in violation of Section 21407.1 may request the arresting officer to have a chemical test made of the arrested person’s blood or breath for the purpose of determining the alcoholic content of that person’s blood, and, if so requested, the arresting officer shall have the test performed.
If a blood or breath test is not available under subparagraph (A) of paragraph (1) of subdivision (a), or under subparagraph (A) of paragraph (2) of subdivision (a), or under paragraph (1) of this subdivision, the person shall submit to the remaining test in order to determine the percent, by weight, of alcohol in the person’s blood. If both the blood and breath tests are unavailable, the person shall be deemed to have given his or her consent to chemical testing of his or her urine and shall submit to a urine test.
Any person convicted under Section 21407.1 shall be punished upon a first conviction by imprisonment in the county jail for not less than 30 days nor more than six months or by a fine of not less than two hundred fifty dollars ($250) nor more than one thousand dollars ($1,000) or by both that fine and imprisonment.
Any person convicted under Section 21407.1 shall be punished upon a second or any subsequent conviction by imprisonment in the county jail for not less than five days nor more than one year and by a fine of not less than two hundred fifty dollars ($250) nor more than one thousand dollars ($1,000), without being granted probation by the court and without having the court suspend the execution of the sentence.
Any person convicted under Section 21407.1 and who, when so operating an aircraft, has done any act forbidden by law or neglects any duty imposed by law in the operation of the aircraft, which act or neglect proximately causes bodily injury to any person other than the operator shall be punished by imprisonment pursuant to subdivision (h) of Section 1170 of the Penal Code, or in the county jail for not less than 90 days nor more than one year and by fine of not less than two hundred fifty dollars ($250) nor more than ten thousand dollars ($10,000).
For any violation of Section 21407 or 21407.1, in addition to the penalties provided by Section 21019 or 21407.6, the court may prohibit the violator from operating an aircraft within the state for a period not exceeding one year. Violation of the prohibition of the court may be treated as a separate offense under this section or as a contempt of court. Upon a plea of guilty or conviction under Section 21407 or 21407.1, the department shall cause a record of the plea or conviction and of the sentence imposed to be maintained. This section does not authorize the court or any other agency or person to take away, impound, hold, or mark any federal certificate, permit, rating, or license. The peace officer requesting that a person submit to a chemical test of the blood, breath, or urine pursuant to Section 21407.2 shall report anyone refusing to submit to the chemical test to the Federal Aviation Administration for appropriate administrative action.
It is unlawful for any person to engage in aeronautics as an airman in the State unless he has an appropriate effective airman certificate, permit, rating, or license issued by the United States authorizing him to engage in the particular class of aeronautics in which he is engaged, if the certificate, permit, rating, or license is required by the United States.
Every airman shall keep any certificate, permit, rating, or license required for him by the United States in his personal possession when he is operating within the state. He shall present it for inspection upon the demand of any peace officer, any other officer of the state or of a political subdivision, or member, official, or employee of the department, authorized by Section 21252 to enforce the aeronautics laws, or any official, manager, or person in charge of any airport upon which the airman lands, or upon the reasonable request of any other person.
It is unlawful for any person to operate, or cause or authorize to be operated, any civil aircraft within this State unless the aircraft has an appropriate effective certificate, permit, or license issued by the United States if required by the United States.
Any certificate, permit, or license required by the United States for an aircraft shall be carried in the aircraft at all times while the aircraft is operating in the state, shall be conspicuously posted in the aircraft where it may be readily seen by passengers or inspectors, and shall be presented for inspection upon the demand of any peace officer, any other officer of the state or of a political subdivision, or member, official, or employee of the department, authorized by Section 21252 to enforce the aeronautics laws, or any official, manager, or person in charge of any airport upon which the aircraft lands, or upon the reasonable request of any person.
The department shall report to the appropriate federal agency all accidents in aeronautics in this state of which it is informed, and shall, insofar as is practicable, preserve, protect, and prevent the removal of the component parts of any aircraft involved in an accident being investigated by it until the federal agency institutes an investigation.
No person shall be in, or perform any act in connection with the maintenance or operation of, any aircraft when under the influence of intoxicating liquor.
This section does not apply to a person who is in an aircraft merely as a passenger, but this section shall not be construed to relieve any such person of criminal liability imposed by any other law for being intoxicated while in an aircraft.
On all commercial aircraft which transport passengers for compensation or hire the door which separates the pilot compartment from the passenger compartment shall be kept locked at all times the aircraft is in a flight over this state during which passengers are being transported except:
During takeoff and landing of the airplane when such door is the means of access to a required passenger emergency exit.
At such times as it may be necessary to provide access to the flight crew or passenger compartments for the crew members in the performance of their duties, or to provide access for other persons authorized admission to the flight crew compartment.
The pilot of the aircraft shall be guilty of a misdemeanor if the door is not so locked.
It shall be unlawful for any person, except a member of the crew, to have in his possession in the passenger compartment at any time the aircraft is in a flight over this state during which passengers are being transported a key or other device for opening such door from the passenger side of the door.
CHAPTER 4. Airports and Air Navigation Facilities [21601. - 21690.29.]
ARTICLE 1. Assistance to Political Subdivisions [21601. - 21605.]
The department may make available its engineering and other technical services, with or without charge, to any political subdivision or person desiring them in connection with the planning, acquisition, construction, improvement, maintenance, or operation of airports or air navigation facilities, subject to rules promulgated by the department.
Subject to the terms and within the limits of special appropriations made by the Legislature, the department may render financial assistance by grant or loan, or both, to political subdivisions jointly, in the planning, acquisition, construction, improvement, maintenance, or operation of an airport owned or controlled, or to be owned or controlled, by a political subdivision or subdivisions, if the financial assistance has been shown by public hearing to be appropriate to the proper development or maintenance of a statewide system of airports. Financial assistance may be furnished in connection with federal or other financial aid for the same purpose.
Notwithstanding subdivision (a) of Section 21681, a city or county designated by the Airport Land Use Commission is eligible to compete for funds held in the Aeronautics Account in the State Transportation Fund on behalf of any privately owned, public use airport that is included in an airport land use compatibility plan. However, the city or county shall be eligible to compete for the funds only when zoning on the parcel is tantamount to a taking of all reasonable uses that might otherwise be permitted on the parcel. The eligible airport and aviation purposes are limited to those specified in paragraphs (4), (5), (6), (9), and (14) of subdivision (f) of Section 21681, and, further, any capital improvements or acquisitions shall become the property of the designated city or county. Matching funds pursuant to subdivision (a) of Section 21684 may include the in-kind contribution of real property, with the approval of the department.
Any grant of funds held in the Aeronautics Account in the State Transportation Fund on behalf of any privately owned airports shall contain a covenant that the airport remain open for public use for 20 years. Any grant made to a city or county on behalf of a privately owned airport shall contain a payback provision based upon existing market value at the time the private airport ceases to be open for public use.
Upon request, California Aid to Airports Program (CAAP) projects included within the adopted Aeronautics Program, may be funded in advance of the year programmed, with the concurrence of the department, in order to better utilize funds in the account.
There is, in the Aeronautics Account in the State Transportation Fund, a subaccount, the Local Airport Loan Account, for the management of funds for loans to local entities pursuant to this chapter. All funds for airport loans in the Special Deposit Fund are hereby transferred to the subaccount. With the approval of the Department of Finance, the department shall deposit in the subaccount all money received by the department from repayments of, and interest on, existing and future airport loans, including, but not limited to, the sums of five hundred forty thousand dollars ($540,000) in repayments from the General Fund due in July 1987, and July 1988, and may, upon appropriation, transfer additional funds from the Aeronautics Account in the State Transportation Fund to the subaccount as the department deems appropriate. Interest on money in the subaccount shall be credited to the subaccount as it accrues.
Notwithstanding subdivision (a) of Section 13340 of the Government Code, the money in the subaccount created by subdivision (e) is hereby continuously appropriated to the department without regard to fiscal years for purposes of loans to political subdivisions for airport purposes.
Upon a determination by the department that the balance in the subaccount exceeds projected needs, funds in the subaccount may be transferred by the department to the Aeronautics Account to fund the California Aid to Airports Program with the approval of the California Transportation Commission and the Department of Finance. The transfers shall not reduce the amount of funds in the subaccount below five million dollars ($5,000,000).
Upon the request of any political subdivision or political subdivisions acting jointly, the department may act as agent in accepting, receiving, receipting for, and disbursing federal money, and other money public or private, made available to finance, in whole or in part, the planning, acquisition, construction, improvement, maintenance, or operation of a public airport or air navigation facility. The department may act as agent in contracting for and supervising the planning, acquisition, construction, improvement, maintenance, or operation. Any political subdivision may designate the department as its agent for these purposes.
The department as principal on behalf of the state, and any political subdivision on its own behalf, may enter into any contracts with each other, the United States, or any person, which may be required in connection with a grant or loan of federal money for public airport or air navigation facility purposes.
All federal money accepted under this section shall be accepted and transferred or expended by the department upon such terms and conditions as are prescribed by the United States. All money received by the department pursuant to this section shall be deposited in the Special Deposit Fund in the State Treasury, to be disbursed or expended in accordance with the terms and conditions upon which it was made available.
No proprietor of any permitted airport which is open to the public and has received public funds shall close or suspend operation of the airport, or close an existing runway or taxiway except on a temporary basis for inspection, maintenance, construction, or emergency purposes, without notifying the department in writing 60 days prior to the intended closure or suspension of operations. On its own motion or upon the request of an affected or interested person, the department may conduct a public hearing to determine the impact of the intended closure or suspension of operations, both economically and on the entire state air transportation system. The department may take appropriate action to assist the proprietor in keeping the airport operational and open for public use.
ARTICLE 2. State Airports and Air Navigation Facilities [21631. - 21646.]
From appropriations or other money made available for the purpose, the department, on behalf of and in the name of the state, may plan, establish, construct, enlarge, improve, maintain, equip, operate, regulate, and protect airports and air navigation facilities, either within or without the state, including the construction, installation, equipment, maintenance, and operation at the airports of buildings and other facilities for the servicing of aircraft or for the comfort and accommodation of air travelers.
The department may also acquire existing airports and air navigation facilities, but it shall not acquire any airport or air navigation facility owned or controlled by a political subdivision of this or any other state without the consent of the political subdivision.
Whenever an airport owned or operated by the United States in this state ceases to be so owned or operated, the department, in consultation with local and regional transportation planning agencies, may evaluate the present and future need for the airport in the state’s public-use airport system, including the need for both the transportation of people and goods. The purpose of the evaluation is to determine aviation needs and does not eliminate any requirement of the California Environmental Quality Act, Division 13 (commencing with Section 21000) of the Public Resources Code.
Prior to finalizing the evaluation, the department shall submit a copy of its report to the commission for review and comment. The commission shall complete its review and forward any comments to the department not later than 45 days after receiving the evaluation.
Upon completion of its evaluation, the department may make a recommendation to the Legislature, the commission, the affected local agencies, and the appropriate federal agency for the airport’s ownership and type of operation as a public-use airport, if the department determines that the airport would be of significant benefit to the state’s airport system. It is the intent of the Legislature that the department, in making its recommendation, give priority for ownership and operation of these public-use airports to a local political subdivision or subdivisions acting jointly.
Notwithstanding Section 21606, if a political subdivision or subdivisions acting jointly notify the department of their intentions to prepare a reuse plan for the airport, and simultaneously apply to the Federal Aviation Administration for a federal grant to develop an airport master plan for the airport, the department shall not make its recommendation pursuant to subdivision (d). If the department’s evaluation determines that the airport would be of significant benefit to the state’s airport system, and the political subdivision or subdivisions acting jointly fail to convert the federal airport to a civil public-use airport in accordance with the department’s evaluation within five years of notification to the department, or fail to evidence substantial progress toward that purpose as determined by the department, then the department may take action in accordance with subdivision (f).
If the department determines the airport is of present or future benefit to the state’s public-use airport system, and no political subdivision applies to the appropriate federal agency to acquire or operate the airport, or has notified the department of its intention to prepare a reuse plan for the airport and thereafter fails to act upon its application pursuant to subdivision (e), the department may, subject to subdivision (g), assist in the formation of a public entity to own and operate the airport which shall be representative of political subdivisions in the area which surrounds and is served by the airport, as determined by the department. If established, the owning and operating entity may, subject to subdivision (g), prepare and submit an application to the appropriate federal agency to acquire or operate, or acquire and operate, the airport as a public airport.
Notwithstanding subdivision (f), if any political subdivision has previously applied to the appropriate federal agency to acquire and operate the airport as a public airport, has completed all required environmental and fiscal evaluations, and subsequently withdrew its application prior to December 31, 1988, the department shall not file any application to acquire or operate the airport or assist in the formation of a public entity to own and operate the airport.
For the purposes of this article, the department, by purchase, gift, devise, lease, condemnation, or otherwise, may acquire real or personal property, or any interest therein, including any property described in Section 21652.
The department may dispose of any property, airport, air navigation facility, or portion or interest, acquired pursuant to this article, by sale, lease, or otherwise. The disposal shall be in accordance with the laws of this state governing the disposition of other state property, except that in the case of disposals to any political subdivision or government or the United States for aeronautical purposes, the disposal may be effected in the manner and upon the terms the department deems in the best interests of the state.
In operating an airport or air navigation facility owned or controlled by the state, the department may enter into contracts, leases, and other arrangements for a term not exceeding 20 years with any person, granting the privilege of using or improving the airport or air navigation facility or space therein for commercial purposes, conferring the privilege of supplying goods, commodities, things, services, or facilities at the airport or air navigation facility, or making available services to be furnished by the department or its agents at the airport or air navigation facility. In each case the department may establish the terms and conditions and fix the charges, rentals, or fees for the privileges or services, which shall be reasonable and uniform for the same class of privilege or service and shall be established with regard to the property and improvement used and the expenses of operation to the state. In no case shall the public be deprived of its rightful, equal, and uniform use of the airport, air navigation facility, or portion of either. The department shall grant no exclusive privilege for the sale or delivery of gasoline or other petroleum products.
The department shall call for bids for the operation of any state-owned airport and shall lease the airport for a term not to exceed five years to the highest qualified bidder or bidders. No person shall be granted any authority to operate the airport other than as a public airport or to enter into any contracts, leases, or other arrangements in connection with the operation of the airport which the department might not have undertaken under Section 21637. The state may operate an airport only if no acceptable bid is received.
The department shall grant no exclusive right for the use of any airport or air navigation facility under its jurisdiction. This section shall not be construed to prevent the making of contracts, leases, and other arrangements pursuant to this article.
To enforce the payment of any charges for repairs, improvements, storage, or care of any personal property by the department or its agents in connection with the operation of an airport or air navigation facility owned or operated by the state, the state has a lien on the property, which is enforceable by the department as provided by law.
It shall be a misdemeanor for any person to release or fly or cause to be released or flown, within five miles of any airport, any moored balloon, kite, unmanned rocket, or unmanned free balloon which might be ingested by an aircraft engine or might cause a pilot’s view of the airport and zone approach to be obstructed, or which could be used to suspend an object capable of endangering airborne aircraft or impairing a pilot’s vision.
ARTICLE 2.5. Non-Public-Use Airports [21650. - 21650.2.]
“Airport” for the purposes of this article means an airport not open to the general public.
An airport shall be marked as required by rule of the department with letters or symbol selected by the department to designate that the airport is not open to the general public. In selecting the letters or symbol, the department shall be guided by letters or symbols currently in use by the Federal Aviation Administration for similar or comparable purposes.
Nothing shall prevent an airport from applying for and receiving a permit pursuant to Article 3 (commencing with Section 21661) of this chapter.
ARTICLE 2.6. Hazard Elimination; Flight Disturbance [21652. - 21653.]
Any person authorized to exercise the power of eminent domain for airport purposes may acquire by purchase, gift, devise, lease, condemnation, or otherwise:
Any property necessary to permit the safe and efficient operation of the airport, or to permit the removal, elimination, obstruction-marking, or obstruction-lighting of airport hazards, or to prevent the establishment of airport hazards.
Airspace or an easement in such airspace above the surface of property where necessary to permit imposition upon such property of excessive noise, vibration, discomfort, inconvenience, interference with use and enjoyment, and any consequent reduction in market value, due to the operation of aircraft to and from the airport.
Remainder property underlying property taken pursuant to paragraph (2), where permitted by Section 1240.410 of the Code of Civil Procedure.
As used in this section, “property” includes real and personal property and any right or interest therein, whether within, beyond, adjacent to, or in the vicinity of, the boundaries of an airport or airport site, and, by way of illustration and not by way of limitation, includes air rights, airspace, air easements, and easements in airport hazards.
Any person authorized to exercise the power of eminent domain for airport purposes may provide, by purchase, gift, devise, lease, condemnation, or otherwise, for the removal or relocation of any airport hazard or the removal or relocation of all facilities, structures, and equipment that may interfere with the location, expansion, development, or improvement of the airport and other air navigation facilities or with the safe approach thereto and takeoff therefrom by aircraft. Any person acting under authority of this section shall pay the cost of such removal or relocation.
ARTICLE 2.7. Regulation of Obstructions [21655. - 21659.]
Notwithstanding any other provision of law, if the proposed site of any state building or other enclosure is within two miles, measured by air line, of that point on an airport runway, or runway proposed by an airport master plan, which is nearest the site, the state agency or office which proposes to construct the building or other enclosure shall, before acquiring title to property for the new state building or other enclosure site or for an addition to a present site, notify the Department of Transportation, in writing, of the proposed acquisition. The department shall investigate the proposed site and, within 30 working days after receipt of the notice, shall submit to the state agency or office which proposes to construct the building or other enclosure a written report of the investigation and its recommendations concerning acquisition of the site.
If the report of the department does not favor acquisition of the site, no state funds shall be expended for the acquisition of the new state building or other enclosure site, or the expansion of the present site, or for the construction of the state building or other enclosure, provided that the provisions of this section shall not affect title to real property once it is acquired.
No person shall erect or add to the height of any structure within the boundaries of this state which will result in a structure that extends more than 500 feet above the ground on which such structure rests until a permit therefor has been issued for such purpose by the department. This section is not applicable to the construction of any structure if the Federal Communications Commission is required to approve the height of the structure or if the height of the structure is required to be approved under the Federal Aviation Act of 1958 (Public Law 85-726; 72 Stat. 731).
The department may refuse issuance of a permit under Section 21656 if it determines that the erection of or addition to a structure would obstruct the airspace overlying the state so as to create an unsafe condition for the flight of aircraft.
Any person denied a permit shall, upon request, be granted a hearing by the department to determine whether a permit shall be issued. The hearing shall be held pursuant to Chapter 5 (commencing with Section 11500) of Part 1 of Division 3 of Title 2 of the Government Code.
No public utility shall construct any pole, pole line, distribution or transmission tower, or tower line, or substation structure in the vicinity of the exterior boundary of an aircraft landing area of any airport open to public use, in a location with respect to the airport and at a height so as to constitute an obstruction to air navigation, as an obstruction is defined in accordance with Part 77 of the Federal Aviation Regulations, Federal Aviation Administration, or any corresponding rules or regulations of the Federal Aviation Administration, unless the Federal Aviation Administration has determined that the pole, line, tower, or structure does not constitute a hazard to air navigation. This section shall not apply to existing poles, lines, towers, or structures or to the repair, replacement, or reconstruction thereof if the original height is not materially exceeded and this section shall not apply unless just compensation shall have first been paid to the public utility by the owner of any airport for any property or property rights which would be taken or damaged hereby.
No person shall construct or alter any structure or permit any natural growth to grow at a height which exceeds the obstruction standards set forth in the regulations of the Federal Aviation Administration relating to objects affecting navigable airspace contained in Title 14 of the Code of Federal Regulations, Part 77, Subpart C, unless the Federal Aviation Administration has determined that the construction, alteration, or growth does not constitute a hazard to air navigation or would not create an unsafe condition for air navigation.
Subdivision (a) does not apply to a pole, pole line, distribution or transmission tower, or tower line or substation of a public utility, as specified in Section 21658.
ARTICLE 3. Regulation of Airports [21661. - 21669.6.]
This article does not apply to any temporary seaplane landing site, ultralight vehicle flightpark, or to airports owned or operated by the United States. To the extent necessary, the department may exempt any other class of airports, pursuant to a reasonable classification or grouping, from any rule or requirement thereof, adopted pursuant to this article, if it finds that its application would be an undue burden on the class and is not required in the interest of public safety.
This section shall become operative on January 1, 1989.
No political subdivision, any of its officers or employees, or any person may submit any application for the construction of a new airport to any local, regional, state, or federal agency unless the plan for construction is first approved by the board of supervisors of the county, or the city council of the city, in which the airport is to be located and unless the plan is submitted to the appropriate commission exercising powers pursuant to Article 3.5 (commencing with Section 21670) of Chapter 4 of Part 1 of Division 9, and acted upon by that commission in accordance with the provisions of that article.
A county board of supervisors or a city council may, pursuant to Section 65100 of the Government Code, delegate its responsibility under this section for the approval of a plan for construction of new helicopter landing and takeoff areas, to the county or city planning agency.
Prior to the acquisition of land or any interest therein, including tide and submerged lands or other lands subject to the public trust for commerce, navigation, or fisheries, by any political subdivision for the purpose of expanding or enlarging any existing publicly owned airport, the acquiring entity shall submit a plan of that expansion or enlargement to the board of supervisors of the county, or the city council of the city, in which the property proposed to be acquired is located.
The plan shall show in detail the airport-related uses and other uses proposed for the property to be acquired.
The board of supervisors or the city council, as the case may be, shall, upon notice, conduct a public hearing on the plan, and shall thereafter approve or disapprove the plan.
Upon approval of the plan, the proposed acquisition of property may begin.
The use of property so acquired shall thereafter conform to the approved plan, and any variance from that plan, or changes proposed therein, shall first be approved by the appropriate board of supervisors or city council after a public hearing on the subject of the variance or plan change.
The requirements of this section are in addition to any other requirements of law relating to construction or expansion of airports.
The department shall have the authority to issue airport site approval permits, amended airport site approval permits, airport permits, and amended airport permits. No charge shall be made for the issuance of any permit.
At or as near as practical to the site of a medical emergency and at a medical facility, an officer authorized by a public safety agency may designate an area for the landing and taking off of an emergency service helicopter, in accordance with regulations established not later than January 1, 1989, pursuant to Section 21243.
“Public safety agency” means any city, county, state agency, or special purpose district authorized to arrange for emergency medical services.
Emergency aircraft flights for medical purposes by law enforcement, firefighting, military, or other persons who provide emergency flights for medical purposes are exempt from local ordinances adopted by a city, county, or city and county, whether general law or chartered, that restrict flight departures and arrivals to particular hours of the day or night, that restrict the departure or arrival of aircraft based upon the aircraft’s noise level, or that restrict the operation of certain types of aircraft.
As used in this section, “emergency aircraft flights for medical purposes” are those flights in which undue delay would threaten a patient’s life. “Emergency aircraft flights for medical purposes” include, but are not limited to, flights for the transportation of any of the following:
Patients accompanied by licensed or certificated medical attendants such as paramedics, nurses, physicians, and respiratory therapists.
Surgical transplant teams for the purpose of procuring human organs for reimplantation in recipients.
Organ procurement agency coordinators responding to a potential donor.
Temporarily viable human organs such as a heart, liver, lungs, kidneys, and pancreas, and human tissue, blood, or blood components.
Human tissue and blood samples for clinical testing to determine compatibility between a donor and a recipient.
Mechanical adjuncts or biological replacements for human organs.
Medical equipment and supplies.
Aircraft or equipment used during a medical emergency, or emergency personnel and first responders involved in treating the medical emergency, for the purpose of returning to its base of operation.
“Emergency aircraft flights for medical purposes” do not include the transportation of medical personnel to attend seminars, conferences, or speaking appearances in which undue delay would not jeopardize any patient’s medical condition.
Any airport that incurs additional expenses in order to accommodate the arrival or departure of emergency aircraft flights for medical purposes may charge the patient on whose behalf the flight is made, or any organization or entity which has volunteered to reimburse the airport, for those expenses.
For emergency aircraft flights for medical purposes, when two airports are located in the same geographical area, and one of the airports is a “closed” or restricted airport, the Legislature encourages the use of the “open” or unrestricted airport when feasible, rather than using the “closed” or restricted airport.
When leasing aircraft for flights for emergency medical purposes, the Legislature encourages the use, when feasible, of aircraft which comply with local noise ordinances.
Notwithstanding Section 21006 or Section 21661 or any other provision of law to the contrary, no helicopter may land or depart in any area within 1,000 feet, measured by air line, of the boundary of any public or private school maintaining kindergarten classes or any classes in grades 1 through 12, without approval of the department or by a public safety agency designated by the department, unless the landing or departure takes place at a permitted permanent heliport, or is a designated emergency medical service landing site.
Before approval of the landing or departure of a helicopter pursuant to this section, all schools within the specified area shall be notified by the department or public safety agency of the application and shall have 15 days after the notice in which to demand a public hearing. The public hearing shall be held at a location in the immediate vicinity of the landing or departure site. The department or public safety agency shall not grant approval pursuant to this section unless it has first found that helicopter operations at the proposed site can be conducted in a safe manner, and in accordance with criteria established by the department.
This section shall not prevent the governing body of any city or county from enacting ordinances or regulations imposing restrictions equal to or greater than those imposed by this section.
It is unlawful for any political subdivision, any of its officers or employees, or any person to operate an airport unless an appropriate airport permit required by rule of the department has been issued by the department and has not subsequently been revoked.
Any political subdivision or person planning to construct, establish, or expand an airport shall apply for the appropriate permit from the department prior to the construction, establishment or expansion. The application shall set forth the location of all highways, railways, wires, cables, poles, fences, schools, residential areas and places of public gathering, and any other information as may be required by the rules and regulations of the department. Whenever an airport owned or operated by the United States ceases to be so owned or operated, any political subdivision or person desiring or planning to own or operate the airport shall apply to the department in compliance with the provisions of this article. If the airport holds a permit issued by the department, the application shall be confined to consideration of the matters enumerated in subdivision (e) of Section 21666.
An amended airport permit shall be required for every expansion of an existing airport. An applicant for an amended airport permit shall comply with each requirement of this article pertaining to permits for new airports. The department may by regulation provide for exemptions from the operation of this section pursuant to Section 21661, except that no exemption shall be made limiting the applicability of subdivision (e) of Section 21666, pertaining to environmental considerations, including the requirement for public hearings in connection therewith.
As used in this section, “airport expansion” includes any of the following:
The acquisition of runway protection zones, as defined in Federal Aviation Administration Advisory Circular 150/1500-13, or of any interest in land for the purpose of any other expansion as set forth in this section.
The construction of a new runway.
The extension or realignment of an existing runway.
Any other expansion of the airport’s physical facilities for the purpose of accomplishing or which are related to the purpose of paragraph (1), (2), or (3).
This section does not apply to any expansion of an existing airport if the expansion commenced on or prior to the effective date of this section and the expansion met the approval, on or prior to that effective date, of each governmental agency that required the approval by law.
The department shall issue a permit if it is satisfied that all of the following requirements have been met:
The site meets or exceeds the minimum airport standards specified by the department in its rules and regulations, provided, however, that the department may modify its minimum airport standards when issuing a permit if it is satisfied that the airport will conform to minimum standards of safety.
Safe air traffic patterns have been established for the proposed airport and for all existing airports and approved airport sites in its vicinity.
The zone of approach of the airport has been engineered in conformity with the provisions of Section 21403, the documents relating thereto are available for public inspection.
The department when issuing a permit may impose reasonable conditions which it deems necessary to effectuate the purposes of this article.
The advantages to the public in selection of the site of a proposed new airport outweigh the disadvantages to the environment or, in the case of an amended permit, the advantages to the public of the proposed airport expansion outweigh the disadvantages to the environment. Environmental considerations include but are not limited to noise, air pollution, and the burden upon the surrounding area caused by the airport or airport expansion, including but not limited to, surface traffic and expense. The standards by which noise considerations are weighed shall be the level of noise acceptable to a reasonable person residing in the vicinity of the airport. The regulations adopted by the department pursuant to Section 21669 may be considered in determining such level of noise.
Each permit issued by the department shall set forth any conditions imposed thereon, and any modification of the general minimum airport standards prescribed by the department relative to such airport or airport site.
The department may refuse to issue a permit under this article if it determines that the requirements of this section have not been met. Any person denied a permit shall, upon request, be granted a hearing by the department to determine whether the permit should be issued.
The department may revoke any airport permit if it determines that any of the following conditions are present:
There has been an abandonment of a site or an airport.
There has been a failure within the time prescribed to develop the site as an airport or to comply with the conditions of the approval as set forth in the permit.
The airport or site no longer conforms to the minimum airport standards prescribed by the department, or no longer complies with the conditions imposed in the airport permit or site approval.
The owner or operator of a permitted airport has failed to comply with any rule or regulation of the department.
The site may no longer be safely used by the general public because of a change in physical or legal conditions either on or off the airport site.
The department shall not revoke a permit under this section without prior notice or opportunity for hearing, unless the department determines in writing that public safety considerations require a summary revocation. In this event, any person aggrieved by the action of the department shall, upon request, be granted a hearing by the department to determine whether the revocation shall remain in effect.
In lieu of revoking an airport permit pursuant to Section 21668, the department may suspend any airport permit, or may require suspension of operations of a portion of an airport, and such suspension shall remain in effect until the department determines that the conditions requiring the suspension no longer exist.
The department shall not order a suspension under this section without prior notice or opportunity for hearing, unless the department determines in writing that public safety considerations require a summary suspension. In this event, any person aggrieved by the action of the department shall, upon request, be granted a hearing by the department to determine whether the suspension shall remain in effect.
The department shall adopt noise standards governing the operation of aircraft and aircraft engines for airports operating under a valid permit issued by the department to an extent not prohibited by federal law. The standards shall be based upon the level of noise acceptable to a reasonable person residing in the vicinity of the airport.
Land use conversion involving existing residential communities shall generally be considered the least desirable action for achieving compliance with noise standards regulations adopted by the Department of Transportation pursuant to Section 21669.
Nothing in this section creates a private right of action in any civil litigation.
This section is declaratory of existing regulations of the department.
In its deliberations, the department shall be governed by the following guidelines:
Statewide uniformity in standards of acceptable airport noise need not be required, and the maximum amount of local control and enforcement shall be permitted.
Due consideration shall be given to the economic and technological feasibility of complying with the standards promulgated by the department.
Any regulations designed to establish a noise monitoring program at an airport entering service after November 30, 1971, shall go into effect on the date the airport enters service.
The violation of the noise standards by any aircraft shall be deemed a misdemeanor and the operator thereof shall be punished by a fine of one thousand dollars ($1,000) for each infraction.
It shall be the function of the county wherein an airport is situated to enforce the noise regulations established by the department. To this end, the operator of an airport shall furnish to the enforcement authority designated by the county the information required by the department’s regulations to permit the efficient enforcement thereof. The operator of each airport shall reimburse the county for its costs of implementing the airport noise regulations contained in Article 8 (commencing with Section 5050) of subchapter 6 of Title 4 of the California Administrative Code, which shall, for purposes of subdivision (c), credit the operator for any amounts received from penalties assessed for violations at such airport. Upon request of the operator, the department shall review and shall determine the reasonableness of such costs, and such costs may be considered in fixing any airport user fees.
Penalties assessed for the violation of the noise regulations shall be used first to reimburse the General Fund for the amount of any money appropriated to carry out the purposes for which the noise regulations are established, and second be used in the enforcement of the noise regulations at participating airports.
For purposes of this section, the following terms have the following meanings:
“Avigation easement” means a less-than-fee-title transfer of real property rights from the property owner that may convey to an owner or operator of an airport any or all of the following rights:
A right-of-way for the free and unobstructed passage of aircraft through the airspace over the property at any altitude above a specified surface.
A right to subject the property to noise, vibration, fumes, dust, and fuel particle emissions associated with normal airport activity.
A right to prohibit the erection or growth of any structure, tree, or other object that would enter the acquired airspace.
A right-of-entry onto the property, with proper advance notice, for the purpose of removing, marking, or lighting any structure or other object that enters the acquired airspace.
A right to prohibit electrical interference, glare, misleading lights, visual impairments, and other hazards to aircraft flight from being created on the property.
“Avigation easement” includes an easement obtained pursuant to paragraph (2) of subdivision (a) of Section 21652.
“CNEL” means community noise equivalent level established pursuant to Chapter 6 (commencing with Section 5000) of Division 2.5 of Title 21 of the California Code of Regulations.
“Noise-sensitive land use” means residential uses, including detached single-family dwellings, multifamily dwellings, highrise apartments or condominiums, mobilehomes, public and private educational facilities, hospitals, convalescent homes, churches, synagogues, temples, and other places of worship.
“Noise-sensitive project” means a project involving new construction or reconstruction for a planned noise-sensitive land use within an airport’s 65 decibels CNEL or higher noise contour.
If a political subdivision conditions approval of a noise-sensitive project upon the grant of an avigation easement to the owner or operator of an airport, the avigation easement shall be required to be granted to the owner or operator of the airport prior to the issuance of the building permit that allows construction or reconstruction of the noise-sensitive project. The owner or operator of an airport that is granted an avigation easement as a condition for approval of a noise-sensitive project pursuant to this subdivision shall be entitled to immediately record it upon receipt.
An avigation easement granted to the owner or operator of an airport as a condition for approval of a noise-sensitive project shall include a termination clause that operates to terminate the avigation easement if the noise-sensitive project is not built and the permit or any permit extension authorizing construction or reconstruction of the noise-sensitive project has expired or has been revoked.
Within 30 days after expiration or revocation of a permit or permit extension that authorized construction or reconstruction of a noise-sensitive project and was conditioned upon the property owner granting an avigation easement to the owner or operator of an airport, the political subdivision that had issued the permit shall notify the owner or operator of the airport of the expiration or revocation of the permit. Within 90 days after receipt of the notice from the political subdivision, the owner or operator of the airport shall record a notice of termination with the county recorder in which the property is located. Proof of filing of the notice of termination shall be provided to the political subdivision by the owner or operator of the airport within 30 days of recordation.
ARTICLE 3.5. Airport Land Use Commission [21670. - 21679.5.]
The Legislature hereby finds and declares that:
It is in the public interest to provide for the orderly development of each public use airport in this state and the area surrounding these airports so as to promote the overall goals and objectives of the California airport noise standards adopted pursuant to Section 21669 and to prevent the creation of new noise and safety problems.
It is the purpose of this article to protect public health, safety, and welfare by ensuring the orderly expansion of airports and the adoption of land use measures that minimize the public’s exposure to excessive noise and safety hazards within areas around public airports to the extent that these areas are not already devoted to incompatible uses.
In order to achieve the purposes of this article, every county in which there is located an airport which is served by a scheduled airline shall establish an airport land use commission. Every county, in which there is located an airport which is not served by a scheduled airline, but is operated for the benefit of the general public, shall establish an airport land use commission, except that the board of supervisors of the county may, after consultation with the appropriate airport operators and affected local entities and after a public hearing, adopt a resolution finding that there are no noise, public safety, or land use issues affecting any airport in the county which require the creation of a commission and declaring the county exempt from that requirement. The board shall, in this event, transmit a copy of the resolution to the Director of Transportation. For purposes of this section, “commission” means an airport land use commission. Each commission shall consist of seven members to be selected as follows:
Two representing the cities in the county, appointed by a city selection committee comprised of the mayors of all the cities within that county, except that if there are any cities contiguous or adjacent to the qualifying airport, at least one representative shall be appointed therefrom. If there are no cities within a county, the number of representatives provided for by paragraphs (2) and (3) shall each be increased by one.
Two representing the county, appointed by the board of supervisors.
Two having expertise in aviation, appointed by a selection committee comprised of the managers of all of the public airports within that county.
One representing the general public, appointed by the other six members of the commission.
Public officers, whether elected or appointed, may be appointed and serve as members of the commission during their terms of public office.
Each member shall promptly appoint a single proxy to represent him or her in commission affairs and to vote on all matters when the member is not in attendance. The proxy shall be designated in a signed written instrument which shall be kept on file at the commission offices, and the proxy shall serve at the pleasure of the appointing member. A vacancy in the office of proxy shall be filled promptly by appointment of a new proxy.
A person having an “expertise in aviation” means a person who, by way of education, training, business, experience, vocation, or avocation has acquired and possesses particular knowledge of, and familiarity with, the function, operation, and role of airports, or is an elected official of a local agency which owns or operates an airport.
It is the intent of the Legislature to clarify that, for the purposes of this article, that special districts, school districts, and community college districts are included among the local agencies that are subject to airport land use laws and other requirements of this article.
Notwithstanding any other provision of this article, if the board of supervisors and the city selection committee of mayors in the county each makes a determination by a majority vote that proper land use planning can be accomplished through the actions of an appropriately designated body, then the body so designated shall assume the planning responsibilities of an airport land use commission as provided for in this article, and a commission need not be formed in that county.
A body designated pursuant to subdivision (a) that does not include among its membership at least two members having expertise in aviation, as defined in subdivision (e) of Section 21670, shall, when acting in the capacity of an airport land use commission, be augmented so that body, as augmented, will have at least two members having that expertise. The commission shall be constituted pursuant to this section on and after March 1, 1988.
Notwithstanding subdivisions (a) and (b), and subdivision (b) of Section 21670, if the board of supervisors of a county and each affected city in that county each makes a determination that proper land use planning pursuant to this article can be accomplished pursuant to this subdivision, then a commission need not be formed in that county.
If the board of supervisors of a county and each affected city makes a determination that proper land use planning may be accomplished and a commission is not formed pursuant to paragraph (1), that county and the appropriate affected cities having jurisdiction over an airport, subject to the review and approval by the Division of Aeronautics of the department, shall do all of the following:
Adopt processes for the preparation, adoption, and amendment of the airport land use compatibility plan for each airport that is served by a scheduled airline or operated for the benefit of the general public.
Adopt processes for the notification of the general public, landowners, interested groups, and other public agencies regarding the preparation, adoption, and amendment of the airport land use compatibility plans.
Adopt processes for the mediation of disputes arising from the preparation, adoption, and amendment of the airport land use compatibility plans.
Adopt processes for the amendment of general and specific plans to be consistent with the airport land use compatibility plans.
Designate the agency that shall be responsible for the preparation, adoption, and amendment of each airport land use compatibility plan.
The Division of Aeronautics of the department shall review the processes adopted pursuant to paragraph (2), and shall approve the processes if the division determines that the processes are consistent with the procedure required by this article and will do all of the following:
Result in the preparation, adoption, and implementation of plans within a reasonable amount of time.
Rely on the height, use, noise, safety, and density criteria that are compatible with airport operations, as established by this article, and referred to as the Airport Land Use Planning Handbook, published by the division, and any applicable federal aviation regulations, including, but not limited to, Part 77 (commencing with Section 77.1) of Title 14 of the Code of Federal Regulations.
Provide adequate opportunities for notice to, review of, and comment by the general public, landowners, interested groups, and other public agencies.
If the county does not comply with the requirements of paragraph (2) within 120 days, then the airport land use compatibility plan and amendments shall not be considered adopted pursuant to this article and a commission shall be established within 90 days of the determination of noncompliance by the division and an airport land use compatibility plan shall be adopted pursuant to this article within 90 days of the establishment of the commission.
A commission need not be formed in a county that has contracted for the preparation of airport land use compatibility plans with the Division of Aeronautics under the California Aid to Airports Program (Chapter 4 (commencing with Section 4050) of Division 2.5 of Title 21 of the California Code of Regulations) and that submits all of the following information to the Division of Aeronautics for review and comment that the county and the cities affected by the airports within the county, as defined by the airport land use compatibility plans:
A commission need not be formed in a county if all of the following conditions are met:
The county has only one public use airport that is owned by a city.
The county and the affected city adopt the elements in paragraph (2) of subdivision (d), as part of their general and specific plans for the county and the affected city.
The general and specific plans shall be submitted, upon adoption, to the Division of Aeronautics. If the county and the affected city do not submit the elements specified in paragraph (2) of subdivision (d), on or before May 1, 1996, then a commission shall be established in accordance with this article.
Sections 21670 and 21670.1 do not apply to the County of Los Angeles. In that county, the county regional planning commission has the responsibility for coordinating the airport planning of public agencies within the county. In instances where impasses result relative to this planning, an appeal may be made to the county regional planning commission by any public agency involved. The action taken by the county regional planning commission on an appeal may be overruled by a four-fifths vote of the governing body of a public agency whose planning led to the appeal.
By January 1, 1992, the county regional planning commission shall adopt the airport land use compatibility plans required pursuant to Section 21675.
Sections 21675.1, 21675.2, and 21679.5 do not apply to the County of Los Angeles until January 1, 1992. If the airport land use compatibility plans required pursuant to Section 21675 are not adopted by the county regional planning commission by January 1, 1992, Sections 21675.1 and 21675.2 shall apply to the County of Los Angeles until the airport land use compatibility plans are adopted.
Sections 21670 and 21670.1 do not apply to the County of San Diego. In that county, the San Diego County Regional Airport Authority, as established pursuant to Section 170002, shall be responsible for the preparation, adoption, and amendment of an airport land use compatibility plan for each airport in San Diego County.
The San Diego County Regional Airport Authority shall engage in a public collaborative planning process when preparing and updating an airport land use compatibility plan.
As used in this section, “intercounty airport” means any airport bisected by a county line through its runways, runway protection zones, inner safety zones, inner turning zones, outer safety zones, or sideline safety zones, as defined by the department’s Airport Land Use Planning Handbook and referenced in the airport land use compatibility plan formulated under Section 21675.
It is the purpose of this section to provide the opportunity to establish a separate airport land use commission so that an intercounty airport may be served by a single airport land use planning agency, rather than having to look separately to the airport land use commissions of the affected counties.
In addition to the airport land use commissions created under Section 21670 or the alternatives established under Section 21670.1, for their respective counties, the boards of supervisors and city selection committees for the affected counties, by independent majority vote of each county’s two delegations, for any intercounty airport, may do either of the following:
Establish a single separate airport land use commission for that airport. That commission shall consist of seven members to be selected as follows:
One representing the cities in each of the counties, appointed by that county’s city selection committee.
One representing each of the counties, appointed by the board of supervisors of each county.
One from each county having expertise in aviation, appointed by a selection committee comprised of the managers of all the public airports within that county.
One representing the general public, appointed by the other six members of the commission.
In accordance with subdivision (a) or (b) of Section 21670.1, designate an existing appropriate entity as that airport’s land use commission.
Any action brought in the superior court relating to this article may be subject to a mediation proceeding conducted pursuant to Chapter 9.3 (commencing with Section 66030) of Division 1 of Title 7 of the Government Code.
In any county where there is an airport operated for the general public which is owned by a city or district in another county or by another county, one of the representatives provided by paragraph (1) of subdivision (b) of Section 21670 shall be appointed by the city selection committee of mayors of the cities of the county in which the owner of that airport is located, and one of the representatives provided by paragraph (2) of subdivision (b) of Section 21670 shall be appointed by the board of supervisors of the county in which the owner of that airport is located.
Except for the terms of office of the members of the first commission, the term of office of each member shall be four years and until the appointment and qualification of his or her successor. The members of the first commission shall classify themselves by lot so that the term of office of one member is one year, of two members is two years, of two members is three years, and of two members is four years. The body that originally appointed a member whose term has expired shall appoint his or her successor for a full term of four years. Any member may be removed at any time and without cause by the body appointing that member. The expiration date of the term of office of each member shall be the first Monday in May in the year in which that member’s term is to expire. Any vacancy in the membership of the commission shall be filled for the unexpired term by appointment by the body which originally appointed the member whose office has become vacant. The chairperson of the commission shall be selected by the members thereof.
Compensation, if any, shall be determined by the board of supervisors.
Staff assistance, including the mailing of notices and the keeping of minutes and necessary quarters, equipment, and supplies shall be provided by the county. The usual and necessary operating expenses of the commission shall be a county charge.
Notwithstanding any other provisions of this article, the commission shall not employ any personnel either as employees or independent contractors without the prior approval of the board of supervisors.
The commission shall meet at the call of the commission chairperson or at the request of the majority of the commission members. A majority of the commission members shall constitute a quorum for the transaction of business. No action shall be taken by the commission except by the recorded vote of a majority of the full membership.
The commission may establish a schedule of fees necessary to comply with this article. Those fees shall be charged to the proponents of actions, regulations, or permits, shall not exceed the estimated reasonable cost of providing the service, and shall be imposed pursuant to Section 66016 of the Government Code. Except as provided in subdivision (g), after June 30, 1991, a commission that has not adopted the airport land use compatibility plan required by Section 21675 shall not charge fees pursuant to this subdivision until the commission adopts the plan.
In any county that has undertaken by contract or otherwise completed airport land use compatibility plans for at least one-half of all public use airports in the county, the commission may continue to charge fees necessary to comply with this article until June 30, 1992, and, if the airport land use compatibility plans are complete by that date, may continue charging fees after June 30, 1992. If the airport land use compatibility plans are not complete by June 30, 1992, the commission shall not charge fees pursuant to subdivision (f) until the commission adopts the land use plans.
Each commission shall adopt rules and regulations with respect to the temporary disqualification of its members from participating in the review or adoption of a proposal because of conflict of interest and with respect to appointment of substitute members in such cases.
In any county not having a commission or a body designated to carry out the responsibilities of a commission, any owner of a public airport may initiate proceedings for the creation of a commission by presenting a request to the board of supervisors that a commission be created and showing the need therefor to the satisfaction of the board of supervisors.
The commission has the following powers and duties, subject to the limitations upon its jurisdiction set forth in Section 21676:
To assist local agencies in ensuring compatible land uses in the vicinity of all new airports and in the vicinity of existing airports to the extent that the land in the vicinity of those airports is not already devoted to incompatible uses.
To coordinate planning at the state, regional, and local levels so as to provide for the orderly development of air transportation, while at the same time protecting the public health, safety, and welfare.
To prepare and adopt an airport land use compatibility plan pursuant to Section 21675.
To review the plans, regulations, and other actions of local agencies and airport operators pursuant to Section 21676.
The powers of the commission shall in no way be construed to give the commission jurisdiction over the operation of any airport.
In order to carry out its responsibilities, the commission may adopt rules and regulations consistent with this article.
The Department of Transportation shall develop and implement a program or programs to assist in the training and development of the staff of airport land use commissions, after consulting with airport land use commissions, cities, counties, and other appropriate public entities.
The training and development program or programs are intended to assist the staff of airport land use commissions in addressing high priority needs, and may include, but need not be limited to, the following:
The establishment of a process for the development and adoption of airport land use compatibility plans.
The development of criteria for determining the airport influence area.
The identification of essential elements that should be included in the airport land use compatibility plans.
Appropriate criteria and procedures for reviewing proposed developments and determining whether proposed developments are compatible with the airport use.
Any other organizational, operational, procedural, or technical responsibilities and functions that the department determines to be appropriate to provide to commission staff and for which it determines there is a need for staff training or development.
The department may provide training and development programs for airport land use commission staff pursuant to this section by any means it deems appropriate. Those programs may be presented in any of the following ways:
An airport land use commission that formulates, adopts, or amends an airport land use compatibility plan shall be guided by information prepared and updated pursuant to Section 21674.5 and referred to as the Airport Land Use Planning Handbook published by the Division of Aeronautics of the Department of Transportation.
It is the intent of the Legislature to discourage incompatible land uses near existing airports. Therefore, prior to granting permits for the renovation or remodeling of an existing building, structure, or facility, and before the construction of a new building, it is the intent of the Legislature that local agencies shall be guided by the height, use, noise, safety, and density criteria that are compatible with airport operations, as established by this article, and referred to as the Airport Land Use Planning Handbook, published by the division, and any applicable federal aviation regulations, including, but not limited to, Part 77 (commencing with Section 77.1) of Title 14 of the Code of Federal Regulations, to the extent that the criteria has been incorporated into the plan prepared by a commission pursuant to Section 21675. This subdivision does not limit the jurisdiction of a commission as established by this article. This subdivision does not limit the authority of local agencies to overrule commission actions or recommendations pursuant to Sections 21676, 21676.5, or 21677.
Each commission shall formulate an airport land use compatibility plan that will provide for the orderly growth of each public airport and the area surrounding the airport within the jurisdiction of the commission, and will safeguard the general welfare of the inhabitants within the vicinity of the airport and the public in general. The commission’s airport land use compatibility plan shall include and shall be based on a long-range master plan or an airport layout plan, as determined by the Division of Aeronautics of the Department of Transportation, that reflects the anticipated growth of the airport during at least the next 20 years. In formulating an airport land use compatibility plan, the commission may develop height restrictions on buildings, specify use of land, and determine building standards, including soundproofing adjacent to airports, within the airport influence area. The airport land use compatibility plan shall be reviewed as often as necessary in order to accomplish its purposes, but shall not be amended more than once in any calendar year.
The commission shall include, within its airport land use compatibility plan formulated pursuant to subdivision (a), the area within the jurisdiction of the commission surrounding any military airport for all of the purposes specified in subdivision (a). The airport land use compatibility plan shall be consistent with the safety and noise standards in the Air Installation Compatible Use Zone prepared for that military airport. This subdivision does not give the commission any jurisdiction or authority over the territory or operations of any military airport.
The airport influence area shall be established by the commission after hearing and consultation with the involved agencies.
The commission shall submit to the Division of Aeronautics of the department one copy of the airport land use compatibility plan and each amendment to the plan.
If an airport land use compatibility plan does not include the matters required to be included pursuant to this article, the Division of Aeronautics of the department shall notify the commission responsible for the plan.
By June 30, 1991, each commission shall adopt the airport land use compatibility plan required pursuant to Section 21675, except that any county that has undertaken by contract or otherwise completed airport land use compatibility plans for at least one-half of all public use airports in the county, shall adopt that airport land use compatibility plan on or before June 30, 1992.
Until a commission adopts an airport land use compatibility plan, a city or county shall first submit all actions, regulations, and permits within the vicinity of a public airport to the commission for review and approval. Before the commission approves or disapproves any actions, regulations, or permits, the commission shall give public notice in the same manner as the city or county is required to give for those actions, regulations, or permits. As used in this section, “vicinity” means land that will be included or reasonably could be included within the airport land use compatibility plan. If the commission has not designated an airport influence area for the airport land use compatibility plan, then “vicinity” means land within two miles of the boundary of a public airport.
The commission may approve an action, regulation, or permit if it finds, based on substantial evidence in the record, all of the following:
The commission is making substantial progress toward the completion of the airport land use compatibility plan.
There is a reasonable probability that the action, regulation, or permit will be consistent with the airport land use compatibility plan being prepared by the commission.
There is little or no probability of substantial detriment to or interference with the future adopted airport land use compatibility plan if the action, regulation, or permit is ultimately inconsistent with the airport land use compatibility plan.
If the commission disapproves an action, regulation, or permit, the commission shall notify the city or county. The city or county may overrule the commission, by a two-thirds vote of its governing body, if it makes specific findings that the proposed action, regulation, or permit is consistent with the purposes of this article, as stated in Section 21670.
If a city or county overrules the commission pursuant to subdivision (d), that action shall not relieve the city or county from further compliance with this article after the commission adopts the airport land use compatibility plan.
If a city or county overrules the commission pursuant to subdivision (d) with respect to a publicly owned airport that the city or county does not operate, the operator of the airport is not liable for damages to property or personal injury resulting from the city’s or county’s decision to proceed with the action, regulation, or permit.
A commission may adopt rules and regulations that exempt any ministerial permit for single-family dwellings from the requirements of subdivision (b) if it makes the findings required pursuant to subdivision (c) for the proposed rules and regulations, except that the rules and regulations may not exempt either of the following:
More than two single-family dwellings by the same applicant within a subdivision prior to June 30, 1991.
Single-family dwellings in a subdivision where 25 percent or more of the parcels are undeveloped.
If a commission fails to act to approve or disapprove any actions, regulations, or permits within 60 days of receiving the request pursuant to Section 21675.1, the applicant or his or her representative may file an action pursuant to Section 1094.5 of the Code of Civil Procedure to compel the commission to act, and the court shall give the proceedings preference over all other actions or proceedings, except previously filed pending matters of the same character.
The action, regulation, or permit shall be deemed approved only if the public notice required by this subdivision has occurred. If the applicant has provided seven days advance notice to the commission of the intent to provide public notice pursuant to this subdivision, then, not earlier than the date of the expiration of the time limit established by Section 21675.1, an applicant may provide the required public notice. If the applicant chooses to provide public notice, that notice shall include a description of the proposed action, regulation, or permit substantially similar to the descriptions which are commonly used in public notices by the commission, the location of any proposed development, the application number, the name and address of the commission, and a statement that the action, regulation, or permit shall be deemed approved if the commission has not acted within 60 days. If the applicant has provided the public notice specified in this subdivision, the time limit for action by the commission shall be extended to 60 days after the public notice is provided. If the applicant provides notice pursuant to this section, the commission shall refund to the applicant any fees which were collected for providing notice and which were not used for that purpose.
Failure of an applicant to submit complete or adequate information pursuant to Sections 65943 to 65946, inclusive, of the Government Code, may constitute grounds for disapproval of actions, regulations, or permits.
Nothing in this section diminishes the commission’s legal responsibility to provide, where applicable, public notice and hearing before acting on an action, regulation, or permit.
Each local agency whose general plan includes areas covered by an airport land use compatibility plan shall, by July 1, 1983, submit a copy of its plan or specific plans to the airport land use commission. The commission shall determine by August 31, 1983, whether the plan or plans are consistent or inconsistent with the airport land use compatibility plan. If the plan or plans are inconsistent with the airport land use compatibility plan, the local agency shall be notified and that local agency shall have another hearing to reconsider its airport land use compatibility plans. The local agency may propose to overrule the commission after the hearing by a two-thirds vote of its governing body if it makes specific findings that the proposed action is consistent with the purposes of this article stated in Section 21670. At least 45 days prior to the decision to overrule the commission, the local agency governing body shall provide the commission and the division a copy of the proposed decision and findings. The commission and the division may provide comments to the local agency governing body within 30 days of receiving the proposed decision and findings. If the commission or the division’s comments are not available within this time limit, the local agency governing body may act without them. The comments by the division or the commission are advisory to the local agency governing body. The local agency governing body shall include comments from the commission and the division in the final record of any final decision to overrule the commission, which may only be adopted by a two-thirds vote of the governing body.
Prior to the amendment of a general plan or specific plan, or the adoption or approval of a zoning ordinance or building regulation within the planning boundary established by the airport land use commission pursuant to Section 21675, the local agency shall first refer the proposed action to the commission. If the commission determines that the proposed action is inconsistent with the commission’s plan, the referring agency shall be notified. The local agency may, after a public hearing, propose to overrule the commission by a two-thirds vote of its governing body if it makes specific findings that the proposed action is consistent with the purposes of this article stated in Section 21670. At least 45 days prior to the decision to overrule the commission, the local agency governing body shall provide the commission and the division a copy of the proposed decision and findings. The commission and the division may provide comments to the local agency governing body within 30 days of receiving the proposed decision and findings. If the commission or the division’s comments are not available within this time limit, the local agency governing body may act without them. The comments by the division or the commission are advisory to the local agency governing body. The local agency governing body shall include comments from the commission and the division in the public record of any final decision to overrule the commission, which may only be adopted by a two-thirds vote of the governing body.
Each public agency owning any airport within the boundaries of an airport land use compatibility plan shall, prior to modification of its airport master plan, refer any proposed change to the airport land use commission. If the commission determines that the proposed action is inconsistent with the commission’s plan, the referring agency shall be notified. The public agency may, after a public hearing, propose to overrule the commission by a two-thirds vote of its governing body if it makes specific findings that the proposed action is consistent with the purposes of this article stated in Section 21670. At least 45 days prior to the decision to overrule the commission, the public agency governing body shall provide the commission and the division a copy of the proposed decision and findings. The commission and the division may provide comments to the public agency governing body within 30 days of receiving the proposed decision and findings. If the commission or the division’s comments are not available within this time limit, the public agency governing body may act without them. The comments by the division or the commission are advisory to the public agency governing body. The public agency governing body shall include comments from the commission and the division in the final decision to overrule the commission, which may only be adopted by a two-thirds vote of the governing body.
Each commission determination pursuant to subdivision (b) or (c) shall be made within 60 days from the date of referral of the proposed action. If a commission fails to make the determination within that period, the proposed action shall be deemed consistent with the airport land use compatibility plan.
If the commission finds that a local agency has not revised its general plan or specific plan or overruled the commission by a two-thirds vote of its governing body after making specific findings that the proposed action is consistent with the purposes of this article as stated in Section 21670, the commission may require that the local agency submit all subsequent actions, regulations, and permits to the commission for review until its general plan or specific plan is revised or the specific findings are made. If, in the determination of the commission, an action, regulation, or permit of the local agency is inconsistent with the airport land use compatibility plan, the local agency shall be notified and that local agency shall hold a hearing to reconsider its plan. The local agency may propose to overrule the commission after the hearing by a two-thirds vote of its governing body if it makes specific findings that the proposed action is consistent with the purposes of this article as stated in Section 21670. At least 45 days prior to the decision to overrule the commission, the local agency governing body shall provide the commission and the division a copy of the proposed decision and findings. The commission and the division may provide comments to the local agency governing body within 30 days of receiving the proposed decision and findings. If the commission or the division’s comments are not available within this time limit, the local agency governing body may act without them. The comments by the division or the commission are advisory to the local agency governing body. The local agency governing body shall include comments from the commission and the division in the final decision to overrule the commission, which may only be adopted by a two-thirds vote of the governing body.
Whenever the local agency has revised its general plan or specific plan or has overruled the commission pursuant to subdivision (a), the proposed action of the local agency shall not be subject to further commission review, unless the commission and the local agency agree that individual projects shall be reviewed by the commission.
Notwithstanding the two-thirds vote required by Section 21676, any public agency in the County of Marin may overrule the Marin County Airport Land Use Commission by a majority vote of its governing body. At least 45 days prior to the decision to overrule the commission, the public agency governing body shall provide the commission and the division a copy of the proposed decision and findings. The commission and the division may provide comments to the public agency governing body within 30 days of receiving the proposed decision and findings. If the commission or the division’s comments are not available within this time limit, the public agency governing body may act without them. The comments by the division or the commission are advisory to the public agency governing body. The public agency governing body shall include comments from the commission and the division in the public record of the final decision to overrule the commission, which may be adopted by a majority vote of the governing body.
With respect to a publicly owned airport that a public agency does not operate, if the public agency pursuant to Section 21676, 21676.5, or 21677 overrules a commission’s action or recommendation, the operator of the airport shall be immune from liability for damages to property or personal injury caused by or resulting directly or indirectly from the public agency’s decision to overrule the commission’s action or recommendation.
In any county in which there is no airport land use commission or other body designated to assume the responsibilities of an airport land use commission, or in which the commission or other designated body has not adopted an airport land use compatibility plan, an interested party may initiate proceedings in a court of competent jurisdiction to postpone the effective date of a zoning change, a zoning variance, the issuance of a permit, or the adoption of a regulation by a local agency, that directly affects the use of land within one mile of the boundary of a public airport within the county.
The court may issue an injunction that postpones the effective date of the zoning change, zoning variance, permit, or regulation until the governing body of the local agency that took the action does one of the following:
In the case of an action that is a legislative act, adopts a resolution declaring that the proposed action is consistent with the purposes of this article stated in Section 21670.
In the case of an action that is not a legislative act, adopts a resolution making findings based on substantial evidence in the record that the proposed action is consistent with the purposes of this article stated in Section 21670.
Rescinds the action.
Amends its action to make it consistent with the purposes of this article stated in Section 21670, and complies with either paragraph (1) or (2), whichever is applicable.
The court shall not issue an injunction pursuant to subdivision (b) if the local agency that took the action demonstrates that the general plan and any applicable specific plan of the agency accomplishes the purposes of an airport land use compatibility plan as provided in Section 21675.
An action brought pursuant to subdivision (a) shall be commenced within 30 days of the decision or within the appropriate time periods set by Section 21167 of the Public Resources Code, whichever is longer.
If the governing body of the local agency adopts a resolution pursuant to subdivision (b) with respect to a publicly owned airport that the local agency does not operate, the operator of the airport shall be immune from liability for damages to property or personal injury from the local agency’s decision to proceed with the zoning change, zoning variance, permit, or regulation.
As used in this section, “interested party” means any owner of land within two miles of the boundary of the airport or any organization with a demonstrated interest in airport safety and efficiency.
Until June 30, 1991, no action pursuant to Section 21679 to postpone the effective date of a zoning change, a zoning variance, the issuance of a permit, or the adoption of a regulation by a local agency, directly affecting the use of land within one mile of the boundary of a public airport, shall be commenced in any county in which the commission or other designated body has not adopted an airport land use compatibility plan, but is making substantial progress toward the completion of the airport land use compatibility plan.
If a commission has been prevented from adopting the airport land use compatibility plan by June 30, 1991, or if the adopted airport land use compatibility plan could not become effective, because of a lawsuit involving the adoption of the airport land use compatibility plan, the June 30, 1991, date in subdivision (a) shall be extended by the period of time during which the lawsuit was pending in a court of competent jurisdiction.
Any action pursuant to Section 21679 commenced prior to January 1, 1990, in a county in which the commission or other designated body has not adopted an airport land use compatibility plan, but is making substantial progress toward the completion of the airport land use compatibility plan, which has not proceeded to final judgment, shall be held in abeyance until June 30, 1991. If the commission or other designated body adopts an airport land use compatibility plan on or before June 30, 1991, the action shall be dismissed. If the commission or other designated body does not adopt an airport land use compatibility plan on or before June 30, 1991, the plaintiff or plaintiffs may proceed with the action.
An action to postpone the effective date of a zoning change, a zoning variance, the issuance of a permit, or the adoption of a regulation by a local agency, directly affecting the use of land within one mile of the boundary of a public airport for which an airport land use compatibility plan has not been adopted by June 30, 1991, shall be commenced within 30 days of June 30, 1991, or within 30 days of the decision by the local agency, or within the appropriate time periods set by Section 21167 of the Public Resources Code, whichever date is later.
ARTICLE 4. Aeronautics Fund [21680. - 21688.]
The Aeronautics Fund is hereby continued in existence as the Aeronautics Account in the State Transportation Fund. The moneys deposited to the credit of the account are continuously appropriated for expenditure by the board and the department as provided in this article.
Any reference in any law or regulation to the Airport Assistance Revolving Fund, the Airport Assistance Fund, or the Aeronautics Fund shall be deemed to refer to the Aeronautics Account in the State Transportation Fund. As used in this article, “fund” shall be deemed to refer to the Aeronautics Account in the State Transportation Fund.
As used in this article, the following terms have the following meanings:
“Own and operate” means that the public entity shall own the property in fee simple or by a long-term lease of a minimum of 20 years, unless otherwise approved by the department, and shall maintain dominion and control of the property, except that the public entity may provide by contract with a person for the operation and management of an airport otherwise meeting the requirements of this article. Operations of the airport shall be for, and on behalf of, the public entity. All leases to the public entity of property are required to be approved by the department. A lease of the property by the public entity to an agent or agency other than to a public entity does not meet the criteria for participation in airport assistance funds.
“Matching funds” means money that is provided by the public entity and does not consist of funds previously received from state or federal agencies or public entity funds previously used to match federal or state funds. This definition shall be retroactive to July 1, 1967.
“General aviation” means all aviation except air carrier and military aviation.
“Public entity” means any city, county, airport district, airport authority, port district, port authority, public district, public authority, political subdivision, airport land use commission, community services district, or public corporation and the University of California.
“Public agency” means the various agencies of the State of California and the federal government.
“Airport and aviation purposes” means expenditures of a capital improvement nature, including the repair or replacement of a capital improvement, and expenditures for compatible land use planning in the area surrounding an airport, for any of the following purposes:
Land acquisition for development and improvement of general aviation aircraft landing facilities.
Grading and drainage necessary for the construction or reconstruction of runways or taxiways.
Construction or reconstruction of runways or taxiways.
Acquisition of “runway protection zones” as defined in Federal Aviation Administration Advisory Circular 150/1500-13.
Acquisition of easements through, or other interests in, airspace as may be reasonably required for safeguarding aircraft operations in the vicinity of an aircraft landing facility.
Removal of natural obstructions from runway protection zones.
Installation of “segmented circle airport marker systems” as defined in current regulations of the Federal Aviation Administration.
Installation of runway, taxiway, boundary, or obstruction lights, together with directly related electrical equipment.
Installation of minimum security fencing around the perimeter of an aircraft landing facility.
Grading and drainage necessary to provide for parking of transient general aviation aircraft.
Construction or reconstruction of transient general aviation aircraft parking areas.
Servicing of revenue or general obligation bonds issued to finance capital improvements for airport and aviation purposes.
Air navigational facilities.
Engineering and preliminary engineering related directly to a project funded under this article.
Other capital improvements as may be designated in rules and regulations adopted by the department.
Activities of an airport land use commission in connection with the preparation of a new or updated airport land use compatibility plan pursuant to Section 21675. Expenditures that cannot be clearly identified as capital improvements shall be submitted to the department for consideration and approval.
Airport master plans and airport layout plans.
“Operation and maintenance” means expenditures for wages or salaries, utilities, service vehicles, and all other noncapital expenditures that are included in insurance, professional services, supplies, construction equipment, upkeep and landscaping, and other items of expenditure designated as “operation and maintenance” in rules and regulations adopted by the department.
“Enplanement” means the boarding of an aircraft by a revenue passenger, including an original, stopover, or transfer boarding of the aircraft. For purposes of this subdivision, a stopover is a deliberate and intentional interruption of a journey by a passenger scheduled to exceed four hours in the case of an intrastate or interstate passenger or not to exceed 24 hours in the case of an international passenger at a point between the point of departure and the point of destination, and a transfer is an occurrence at an intermediate point in an itinerary whereby a passenger or shipment changes from a flight of one carrier to another flight either of the same or a different carrier with or without a stopover.
The department shall establish individual revolving fund subaccounts for eligible airports in the Aeronautics Account in the State Transportation Fund. Money payable under this section shall be credited to individual airport subaccounts annually, and may be accumulated for a maximum period of five years.
The department shall, subject to Section 21684, credit from the Aeronautics Account to each public entity owning and operating an airport or airports under a valid permit issued by the department for every airport which has not been designated by the Federal Aviation Administration as (1) a reliever airport, as defined in Section 503 (a) (19) of the federal Airport and Airway Improvement Act of 1982, as amended, or (2) a commercial service airport, as defined in Section 503 (a) (5) of the federal Airport and Airway Improvement Act of 1982, as amended, the sum of ten thousand dollars ($10,000) annually for each qualifying airport. These funds shall be paid to public entities upon request for expenditure on preapproved eligible projects. Eligible public entities may submit applications for the withdrawal of credited funds for expenditure on proposed projects in letter form to the department for review and approval. Projects identified shall be for airport and aviation purposes and operation and maintenance purposes. No payment made under this section is transferable, but shall be expended only upon the airport for which the payment is made, unless the department authorizes a payment to be transferred for expenditure on another airport owned or operated by the public entity. The department may establish any accounting systems it deems necessary to provide for the cumulation and expenditure of funds under this subdivision.
If, in any year, there is insufficient money in the Aeronautics Account to make the credits specified in subdivision (b), the department shall, subject to Section 21684, credit to each public entity subaccount an amount which is equal to the total amount of money in the Aeronautics Account multiplied by a percentage equivalent to the proportion which the airport or airports of the public entity for which credit is required to be made pursuant to subdivision (b) bear to the total number of airports for which credit is required to be made pursuant to subdivision (b).
No payment shall be made under this section to any public entity for any airport on which general or commercial aviation activities are substantially restricted if the airport is licensed to conduct these activities by the department. The department shall determine whether or not general or commercial aviation activities are restricted.
The department shall adopt rules and regulations and establish procedures to effect prompt payment to public entities for eligible airport projects from money credited pursuant to this section.
The department shall pay, from the Aeronautics Account to the Transportation Planning and Development Account in the State Transportation Fund, a sum equal to the pro rata share of the comprehensive transportation duties attributable to aviation planning and research, as determined by the Director of Transportation.
Any public entity may apply to the department each year for the allocation of funds for the acquisition or development of airports. The commission may, pursuant to rules and regulations promulgated by the department, make an allocation to the public entity if it determines that the proposed acquisition or development is feasible and in accordance with the policies and standards established by the department. The department shall make recommendations to the commission on all applications. Such allocations shall be represented as subventions in the department budget in accordance with Section 21206.
No moneys paid under this section shall be expended for operation and maintenance. No payment shall be made under this section to any public entity for any airport on which general or commercial aviation activities are substantially restricted if the airport is licensed to conduct such activities by the department. The department shall determine whether or not general or commercial aviation activities are restricted.
At the discretion of the commission, any balance remaining in the Aeronautics Account, after the payments made under Section 21682, may be used to provide a portion of the local match for federal Airport Improvement Program grants. Matching shall be provided only for grants at general aviation airports, or at airports that have been designated by the Federal Aviation Administration as reliever airports, as defined in Section 503(a)(19) of the federal Airport and Airway Improvement Act of 1982, as amended.
Funds shall not be allocated by the commission until the federal grant offer is accepted by the public entity. Upon allocation by the commission, the department may pay a public entity an amount equal to 5 percent of the amount of a federal Airport Improvement Program grant. These funds are excluded from the requirements of Section 21684.
Funds shall not be allocated by the commission until the federal grant offer is accepted by the public entity. Upon allocation by the commission, the department may, until December 31, 2006, pay a public entity an amount equal to the 10 percent local match required for a federal Airport Improvement Program grant for security projects at small general aviation airports. For purposes of this section, a “security project” means a project to install or maintain fencing, gates, security lighting, access controls systems, and surveillance systems. For purposes of this section a “small general aviation airport” means an airport with fewer than 80,000 annual landings and take-offs of aircraft.
No payment shall be made to a public entity pursuant to this article unless the public entity has established a special aviation fund in which all payments received by a public entity under this article shall be deposited for expenditure solely for airport and aviation purposes. No payment shall be made to a public entity for a project pursuant to Section 21683.2 unless the public entity deposits in its special aviation fund a sum from other than state or federal sources, established annually by the commission at not less than 10 percent nor more than 50 percent of the nonfederal portion of the project.
Notwithstanding the provisions of this subdivision requiring matching funds, the department shall pay to each public entity owning and operating an airport or airports the annual amount that is in accordance with Section 21682.
No payment shall be made for any airport to the University of California pursuant to this article unless the university has established a special aviation fund in which all payments received by the university under this article shall be deposited for expenditure solely for airport and aviation purposes. No payment shall be made for any airport to the University of California pursuant to Section 21683.2 unless the university deposits in its special aviation fund each year, for expenditure solely for airport and aviation purposes, a sum from nonstate or nonfederal funds based on the rate established annually by the commission pursuant to subdivision (a), or unless a city located within 10 miles of the airport or the county within which the airport is located pays to the university a sum based on the rate established annually by the commission pursuant to subdivision (a). However, any sums so deposited by the university or paid by the city or county may be considered jointly as meeting the requirements of this section. The payments received from a city or county pursuant to these sections are to be expended solely for the airport and for aviation purposes related to such airport. All payments received by the university shall be deposited in its special aviation fund.
Notwithstanding the provisions of Section 21683, any balance remaining in the fund after the payments made under Section 21682 may be used by the department to purchase emergency search and rescue equipment and to make such equipment available for use by recognized search and rescue groups. The equipment shall remain the property of the department. No more than eight thousand dollars ($8,000) shall be expended pursuant to this section for the purchase of emergency search and rescue equipment.
Notwithstanding the provisions of this article inasmuch as they require matching funds the department may allocate funds to public agencies for the construction of airports.
Notwithstanding the provisions of this article, inasmuch as they require matching funds, the department may allocate funds to a county or a city for the construction of recreational airports or reliever training airstrips in accordance with regulations of the department if the county or city supplies the land and maintains and operates all facilities of such airport or airstrip.
Any public entity may pay any part of the money in its special aviation fund to a state college or branch of the University of California located within its boundaries to be expended for the same purposes as the public entity may expend such money. Any money paid to a state college or branch of the University of California shall be expended within the public entity paying the money.
It shall be the duty of any public entity receiving payments or allocations under this article to periodically audit its books and records as deemed necessary by the department for the purpose of determining that the money received has been expended for the purposes and under the conditions authorized by this article.
If an airport, for which payments have been made from the Aeronautics Account, ceases to be open to the general public for more than one year, the public entity to which those payments were made shall pay to the state funds equal to the amount computed by the department pursuant to paragraph (2), and those funds shall be deposited in the Aeronautics Account.
The department shall compute an amount equal to the total of all payments made for the airport from the Aeronautics Account during the preceding 20 years, less 5 percent of the amount of a particular payment multiplied by the number of years since the payment was made, or the unused balance, whichever is greater.
The computation described in subparagraph (A) shall not include any payment the department made pursuant to Section 21682, if, upon the request of the public entity that owns and operates the airport, the department determines that the airport is not necessary to the system of public airports in this state. When making this determination, the department shall consider all of the following factors:
Whether the airport is approved for night operations.
Whether the airport has an approved instrument approach procedure.
How many aircraft are based at the airport.
Whether the airport is used for airborne fire attacks.
Whether the airport is used for emergency medical transportation.
What services the airport provides for the community.
The size of the community that is served by the airport.
Whether any aviation or transportation planning agency has designated the airport as having a significant role.
Whether a suitable, public-use airport is situated within a reasonable distance.
Whether closure of the airport will have a negative effect on other airports.
Whether the airport is used for law enforcement purposes.
This section does not apply to either of the following:
An airport that is replaced by a comparable facility, as determined by the department, within a period of one year.
An airport for which the department, on or after January 1, 1981, has suspended the airport permit and for which payments made pursuant to this article are being expended to correct the deficiency or condition that resulted in the suspension of the airport’s permit.
No payments shall be made from the Aeronautics Account for expenditure on any airport or for the acquisition or development of any airport, if the department determines that the height restrictions around the airport are inadequate to provide reasonable assurance that the landing and taking off of aircraft at the airport will be conducted without obstruction or will be otherwise free from hazards.
Height restrictions shall be considered adequate if as a minimum they meet the obstruction standards of subchapter C of Part 77 of the Federal Aviation Regulations of the Federal Aviation Administration, as these standards apply to civil airport imaginary surfaces related to runways.
The airport-owning entity shall have sufficient control over obstructions in the airspace in the vicinity of the airport to assure that height restrictions can be maintained. This control may be in the form of ownership of any land from which obstructions may rise, air navigation easements to guarantee maintenance of restrictions, or height limitation or land use zoning which will prohibit obstructions which would violate the obstruction standards.
This section shall not prevent or prohibit the department from assisting any public agency or public entity in planning airport development or in planning the zoning needs around an airport.
ARTICLE 4.5. Airport Facilities and Concessions [21690.5. - 21690.10.]
The Legislature finds and declares as follows:
The proper operation of California’s publicly owned or operated airports is essential to the welfare of the state and its people.
California’s publicly owned or operated airports establish a vital transportation link between the state and the economic systems of the nation and the world, and enable the state to enjoy and provide the benefits of an international tourist and commercial center.
The economic validity and stability of California’s publicly owned or operated airports is, consequently, a matter of statewide importance.
The policy of this state is to promote the development of commerce and tourism to the end of securing to the people of this state the benefits of these activities conducted in the state.
Therefore, since the proper operation of the state’s publicly owned or operated airports is essential to the welfare of the state and its people, the Legislature recognizes and affirms such operation as a governmental function to be discharged in furtherance of the policy of securing the benefits of commerce and tourism for the state and its people.
The provisions of this article shall apply to any airport owned or operated by a political subdivision, including a charter city.
The governing bodies of publicly owned or operated airports shall manage airport facilities and grant airport concessions in furtherance of the development of commerce and tourism in or affecting the state. In managing facilities and granting concessions for services to the public, such airport governing bodies shall promote the development of commerce and tourism by (a) securing a diversity of airport services; (b) avoiding wasteful duplication of such services; (c) securing to the users of airports safe, courteous, and quality service; (d) limiting or prohibiting business competition which is destructive of the ends of promoting commerce and tourism in the state; (e) allocating limited airport resources to promote such ends; and (f) fostering California’s image as a commercial and tourist center.
The Legislature recognizes that to further the policies and fulfill the objectives stated in this article, it is often necessary that publicly owned or operated airports enter into exclusive or limited agreements with a single operator or a limited number of operators. The governing bodies of publicly owned or operated airports shall grant exclusive or limited agreements to displace business competition with regulation or monopoly service whenever the governing body determines, in consideration of the factors set forth in Section 21690.9, that such agreements are necessary to further the policies and to fulfill the objectives stated in this article. The Legislature contemplates that publicly owned or operated airports will grant exclusive or limited agreements in furtherance of the policy of this state to displace business competition by exclusive or limited agreements to fulfill these policies and objectives.
Before entering any exclusive or limited agreement in connection with the management of any airport facility or the operation of any airport concession, the governing body of a publicly owned or operated airport shall, under authority hereby expressly delegated by the state, determine the necessity for an exclusive or limited agreement. The governing body shall consider the following factors to determine the necessity for an exclusive or limited agreement to further the policies and objectives stated in this article:
Public safety.
Public convenience.
Quality of service.
The need to conserve airport space.
The need to avoid duplication of services.
The impact on the environment or facilities of the airport as an essential commercial and tourist service center.
The need to avoid destructive competition which may impair the quality of airport services to the public, lead to uncertainty, disruption, or instability in the rendering of such services, or detract from the state’s attractiveness as a center of tourism and commerce.
In making its determination, the airport operator shall not be required to take evidence or to make findings of fact.
Nothing in this article shall excuse any local agency from complying with applicable state or local requirements for competitive bidding or public hearings which may be required prior to the awarding or entering into of any bid, agreement or lease.
ARTICLE 5. Los Angeles International Airport Relocation and Development [21690.20. - 21690.29.]
The Legislature hereby finds that Los Angeles International Airport is one of the important air terminals of the world, making a significant contribution daily to the economy of California.
Since 1959, jet air traffic at the airport has increased from 80 flights daily to nearly 1,000 daily. This increasing air traffic and necessary expansion of airport facilities has had an adverse affect on the residents of the surrounding areas. Expansion and development has and is expected to require the acquisition of many homes in the vicinity of the airport and has rendered other homes in areas subjected to aircraft noise nearly uninhabitable. Property owners in the vicinity of the airport are either unable to sell their homes or able to sell only at depressed market prices. Under present laws, the Department of Airports of the City of Los Angeles is required only to pay homeowners “fair market value” for their property. With increasing property costs and current high interest rates, it is impossible for a homeowner to purchase a comparable dwelling in a comparable residential area for amounts now being paid as “fair market value.”
The City Council of the City of Los Angeles has initiated this legislation to enable the city to (1) assist displaced homeowners to relocate in comparable residential areas and housing, (2) provide, where available, replacement housing acceptable to affected homeowners, and (3) purchase affected homes to compensate homeowners for the depressed values of their property.
There is precedent for the provision of replacement housing, where available, in Chapter 953 of the Statutes of 1968, by which the Department of Public Works is authorized to provide relocation assistance and replacement housing to certain individuals and families displaced because of construction of certain state highway projects. Further, there is precedent for relocation payments to compensate certain homeowners in Public Law 90-495 and in Chapter 3 of the Statutes of 1968, First Extraordinary Session.
Unless the context otherwise requires, the following definitions shall govern the construction of this article:
“Airport” means Los Angeles International Airport.
“Department” means the Department of Airports, City of Los Angeles.
“Mayor” means the Mayor of the City of Los Angeles.
“Board” means the Los Angeles International Airport Property Acquisition Board.
Notwithstanding any other provision of law, the department is authorized to:
Assist homeowners displaced by the expansion of the airport to relocate in comparable residential areas and housing.
Provide, where available, replacement housing acceptable to affected homeowners.
Purchase affected property to compensate homeowners for the depressed values of their property as a result of the proximity of the airport to enable such homeowners to purchase comparable housing under more normal market conditions.
The department is authorized to expend any available funds, including state and federal funds, for the purpose of purchasing homes from homeowners displaced by the expansion of the airport and relocating or providing suitable replacement housing for such persons, notwithstanding any other provision of law.
Upon establishment of a program for additional payments to homeowners by the department pursuant to this article, the affected property owners may petition as provided in Section 21690.26 for the payment of additional compensation for the depressed value of the affected property resulting from the presence and operation of the airport, provided that such owner has not previously recovered any sums in the nature of an inverse condemnation award by reason of the presence and operation of the airport.
Upon establishment by the department of a program for such additional compensation, the mayor shall appoint, subject to the approval of the city council, five persons who shall constitute the board.
The members of the board shall serve at the pleasure of the mayor, and any action taken by a majority thereof shall constitute the action of the board. The board shall hear petitions from homeowners dislocated by reason of airport expansion and operations for amounts to be paid in excess of market value of affected property. The board shall establish procedures for the conduct of its business.
The Board of Airport Commissioners of the City of Los Angeles is directed to pay any sum awarded by the board pursuant to Section 21690.26.
The provisions of this article are available only to persons who own residential property which has been or is being condemned or sold for airport purposes. Petitions for additional compensation may be filed with the board at the same time that condemnation proceedings or acquisition negotiations are initiated; and the board shall pay any sum awarded pursuant to Section 21690.26 within 60 days after condemnation or other acquisition proceedings are completed.
If any provision of this article or the application thereof to any person or circumstances is held invalid, such invalidity shall not affect other provisions or applications of the article which can be given effect without the invalid provision or application, and to this end the provisions of this act are severable.
CHAPTER 5. Proceedings [21692. - 21694.]
The department, any member, the director, or any officer or employee of the department designated by it may hold investigations, inquiries, and hearings concerning matters covered by this part and the rules and orders of the department, and concerning accidents in aeronautics within this state. Hearings shall be open to the public and, except as provided in Section 21691, shall be held upon such call or notice as the department deems advisable. Each member of the department, the director, and every officer or employee of the department designated by it to hold any inquiry, investigation, or hearing may administer oaths and affirmations, certify to all official acts, issue subpoenas, and order the attendance and testimony of witnesses and the production of papers, books, and documents. If any person fails to comply with any subpoenas or order issued under the authority of this section, the department or its authorized representative may invoke the aid of any court of general jurisdiction. The court may order such person to comply with the requirements of the subpoena or order to give evidence touching the matter in question. Failure to obey the order of the court may be punished by the court as contempt.
In order to facilitate the making of investigations by the department in the interest of public safety and promotion of aeronautics, the reports of investigations or hearings or any part of the reports, shall not be admitted in evidence or used for any purpose in any suit, action, or proceeding growing out of any matter referred to in the investigation, hearing, or report, except in case of any suit, action, or proceeding, civil or criminal, instituted by or in behalf of the department or in the name of the state under the provisions of this part or other laws of the state relating to aeronautics. Any member of the department, the director, or any officer or employee of the department shall not be required to testify to any facts ascertained in, or information gained by reason of, his official capacity, nor be required to testify as an expert witness in any suit, action, or proceeding involving any aircraft. Subject to these limitations, the department may make available to appropriate federal, state, and political subdivision agencies information and material developed in the course of its investigations and hearings.
Every order of the department requiring performance of certain acts or compliance with certain requirements shall set forth the reasons, state the acts to be done or requirements to be met, and be served upon the person affected either by registered mail or in person. Any person aggrieved by an order of the department may have the action of the department reviewed by the courts in the manner provided by law.
CHAPTER 6. Airport Planning [21701. - 21707.]
The division, in consultation with transportation planning agencies as designated by the director pursuant to Section 29532 of the Government Code, shall prepare a California Aviation System Plan, which shall include, but not be limited to, every California airport designated in the federal National Plan of Integrated Airport Systems and any other existing or proposed public use airports, as designated by the division.
The California Aviation System Plan shall include, but not be limited to, all of the following elements:
A background and introduction element, which summarizes aviation activity in California and establishes goals and objectives for aviation improvement.
An air transportation issues element, which addresses issues such as aviation safety, airport noise, airport ground access, transportation systems management, airport financing, airport land use compatibility planning, and institutional relationships.
A regional plan alternative element, which consists of the aviation elements of the regional transportation plans prepared by each transportation planning agency. This element shall include consideration of regional air transportation matters relating to growth, capacity needs, county activity, airport activity, and systemwide activity in order to evaluate adequately the overall impacts of regional activity in relation to the statewide air transportation system. This element shall propose general aviation and air carrier public use airports for consideration by the commission for funding eligibility under this chapter.
A state plan alternative element, which includes consideration of statewide air transportation matters relating to growth, including, but not limited to, county activity, airport activity, and systemwide activity in order to evaluate adequately the state aviation system and to designate an adequate number of general aviation and air carrier public use airports for state funding in order to provide a level of air service and safety acceptable to the public.
A comparative element, which compares and contrasts the regional plan alternative with the state plan alternative, including, but not limited to, airport noise, air quality, toxic waste cleanup, energy, economics, and passengers served.
A 10-year capital improvement plan for each airport, based on each airport’s adopted master plan if the airport has a master plan, approved by the applicable transportation planning agency, and submitted to the division for inclusion in the California Aviation System Plan.
Any other element deemed appropriate by the division and the transportation planning agencies.
A summary and conclusion element, which presents the findings and recommended course of action.
The division shall submit the California Aviation System Plan to the commission.
The division, in consultation with the transportation planning agencies, shall biennially revise the capital improvement plan developed pursuant to subdivision (f) of Section 21702, and the division shall submit the revised capital improvement plan to the commission. The division, in consultation with the transportation planning agencies, shall revise all other elements of the California Aviation System Plan every five years, and shall submit the revised system plan to the commission.
The commission shall review, hold public hearings on, and, based on these hearings, adopt or revise and adopt as revised, the California Aviation System Plan and its subsequent revisions.
The division shall require that every project submitted for funding from the Aeronautics Account in the State Transportation Fund shall be consistent with the California Aviation System Plan. Applications for funding shall be processed in accordance with the procedures adopted by the commission. In determining the priorities of projects, the division shall, and the transportation planning agencies may, utilize the methodology adopted by the commission for determining the priorities of projects that the commission selects for allocation pursuant to Sections 21683 and 21683.2 and the procedures adopted by the commission.
CHAPTER 7. Skydiving or Sport Parachuting Operations [21708. - 21709.]
This chapter shall be known and may be cited as “Tyler’s Law.”
To the extent allowed by federal law, the owners and operators of a skydiving or sport parachuting operation shall have a duty to ensure that the parachutist in command of a tandem jump and the parachute rigger responsible for packing the parachute are in compliance with all federal laws relating to parachute safety and certification.
This section does not decrease any legal duties.
CHAPTER 8. Leaded Aviation Gasoline [21710. - 21712.]
For purposes of this chapter, “aviation retail establishment” means any public or private entity that sells aviation gasoline, or offers or otherwise makes available aviation gasoline, to a customer, including other businesses or government entities, for use in this state.
An airport operator or aviation retail establishment shall not sell, distribute, or otherwise make available leaded aviation gasoline to consumers on or after January 1, 2031, in compliance with Section 47107 of Title 49 of the United States Code.
If a provision of this chapter conflicts with a federal grant assurance in effect on or before December 31, 2030, that provision shall not apply to an airport operator subject to that grant assurance until the federal grant assurance expires.
PART 2. AIRPORT DISTRICTS [22001. - 22909.]
CHAPTER 1. General Provisions and Definitions [22001. - 22017.]
This part may be cited as the “California Airport District Act.”
The purpose of this part is to facilitate the formation of intercity and county airport districts having responsibility for the development of airports, spaceports, and air navigation facilities, the objective being to encourage airport and spaceport development by communities and to distribute the cost uniformly among all who benefit.
Unless the context otherwise requires, the definitions and general provisions contained in this chapter govern the construction of this part.
Airport districts may be created, maintained, and managed as provided in this part and may exercise the powers expressly granted or necessarily implied.
A district may lie within or include the territories of one or more counties. It may include one or more cities, all or any part of any city and any part of the unincorporated territory of any county.
The boundaries of a district may be altered and outlying contiguous territory in the same or an adjoining county annexed to the district.
Except as otherwise provided in this part, the law governing the qualifications of electors, the manner of voting, the duties of election officers, the canvassing of returns, declaration of results, and all other particulars in respect to the calling and holding of general municipal elections in cities of the fifth and sixth class, so far as applicable, governs all district elections.
“District” means airport district, formed and proposed to be formed, pursuant to this part.
“Principal county” means the county in which all of the territory of the district is situated, or if the territory is situated in more than one county, the county in which the greatest portion of the territory is situated.
“Affected county” means any county in which the territory of the district is situated.
“Board” means the board of directors of the district.
“Director” means member of the board.
“Secretary” means secretary of the board.
“Bond election” means an election provided for in Article 2 (commencing with Section 22731) of Chapter 5.
“Formation election” means an election provided for in Article 4 (commencing with Section 22226) of Chapter 2.
“Bond tax” means the tax levied pursuant to Chapter 6 (commencing with Section 22901) for the payment of the bonded indebtedness of the district.
“District tax” means the tax levied pursuant to Chapter 6 for the payment of expenses of, and claims against the district, other than the bonded indebtedness.
CHAPTER 2. Formation [22151. - 22259.]
ARTICLE 1. Resolution [22151. - 22153.]
The board of supervisors of each county desiring to form, or join in forming, a district shall adopt a resolution of intention to that effect.
Each resolution shall contain:
A statement of intention to form a district.
The boundaries of the district or some other designation of its territorial extent.
The name of the district.
The time and place for hearing objections to the formation of the district or to its extent. The time of the hearing shall not be less than 30 days after the adoption of the resolution.
The name of the newspaper in which the resolution shall be published.
Each resolution shall be published pursuant to Section 6061 of the Government Code in the county concerned. The board of supervisors may order it published in more than one newspaper. Publication shall be at least 20 days before the date of hearing. The publication of the resolution constitutes the notice of the hearing.
ARTICLE 2. Investigation and Termination by Majority Protest [22176. - 22178.]
Except as otherwise provided in this article, the District Investigation Law of 1933 applies to districts formed under this part.
The requirements of the District Investigation Law for the mailing of the notice of hearing, and for the inclusion in the report of value and liability statements provided for in Article 3 of that law, do not apply to districts formed under this part if the board of supervisors of each affected county, prior to the hearing on the formation of the district, finds by resolution adopted by a four-fifths vote of its members that:
In its opinion the probable assessments will not exceed the limitations prescribed in the District Investigation Law.
The property to be assessed will be able to carry the assessments.
The assessment limitations may be dispensed with.
ARTICLE 3. Hearing [22201. - 22204.]
Written protests or objections to the formation of the district or to its extent within the county may be filed in the office of the clerk of the board of supervisors of any affected county at any time prior to the hour fixed for the hearing. At the hearing the board of supervisors shall consider only the protests or objections filed pursuant to this section.
The board of supervisors of each affected county shall hold a public hearing to consider the objections or protests at the time fixed for the hearing. The hearing may be continued by order of the board of supervisors entered on its minutes.
Each board of supervisors may overrule any protests or objections filed with it.
The board of supervisors of each affected county may exclude any territory within the county that in its opinion will not be benefited by inclusion in the district.
ARTICLE 4. Election [22226. - 22232.]
If after the hearing the board of supervisors of each affected county determines that the district should be formed, each board, by resolution entered on its minutes, shall:
Define and describe the boundaries of the district or otherwise designate its territorial extent.
State the name of the district, which shall contain the words “____________________ airport district.”
Call an election in the county, or portion thereof within the district, for the purpose of determining whether the district shall be formed and to elect a board of five directors for the district if formed.
Fix the date of the election and the hours the polls will be open.
Establish election precincts and designate polling places for the election.
Appoint the election officers.
The resolution shall be published pursuant to Section 6066 of the Government Code in each county and city in the district. The first publication shall be at least 30 days prior to the date of the election. The resolution may be published in more than one newspaper by order of the board of supervisors of the affected county.
The proposition submitted at the election shall be “Shall the proposition to form ____________________ Airport District under the California Airport District Act be adopted?”
Except as otherwise provided in this article, the election shall be called, noticed, and conducted, candidates nominated, the vote canvassed, and the results declared in the manner prescribed by law for general municipal elections in general law cities and by the general laws so far as applicable.
Within five days after the district formation election has been called, the legislative body which has called the election shall transmit, by registered mail, a written notification of the election call to the executive officer of the local agency formation commission of the county or principal county in which the territory or major portion of the territory of the proposed district is located. Such written notice shall include the name and a description of the proposed district, and may be in the form of a certified copy of the resolution adopted by the legislative body calling the district formation election.
The executive officer, within five days after being notified that a district formation election has been called, shall submit to the commission, for its approval or modification, an impartial analysis of the proposed district formation.
The impartial analysis shall not exceed 500 words in length and shall include a specific description of the boundaries of the district proposed to be formed.
The local agency formation commission, within five days after the receipt of the executive officer’s analysis, shall approve or modify the analysis and submit it to the officials in charge of conducting the district formation election.
The board of supervisors or any member or members of the board authorized by the board, or any individual voter or bona fide association of citizens entitled to vote on the district formation proposition, or any combination of such voters and associations of citizens, may file a written argument for or a written argument against the proposed district formation.
Arguments shall not exceed 300 words in length and shall be filed with the officials in charge of conducting the election not less than 54 days prior to the date of the district formation election.
If more than one argument for or more than one argument against the proposed district formation is filed with the election officials within the time prescribed, such election officials shall select one of the arguments for printing and distribution to the voters.
In selecting the arguments, the election officials shall give preference and priority in the order named to the arguments of the following:
The board of supervisors or any member or members of the board authorized by the board.
Individual voters or bona fide associations of citizens or a combination of such voters and associations.
The officials in charge of conducting the election shall cause a ballot pamphlet concerning the district formation proposition to be voted on to be printed and mailed to each voter entitled to vote on the district formation question.
The ballot pamphlet shall contain the following in the order prescribed:
The complete text of the proposition.
The impartial analysis of the proposition prepared by the local agency formation commission.
The argument for the proposed district formation.
The argument against the proposed district formation.
The election officials shall mail a ballot pamphlet to each voter entitled to vote in the district formation election at least 10 days prior to the date of the election. The ballot pamphlet is “official matter” within the meaning of Section 13303 of the Elections Code.
At the first election the board of supervisors of each affected county and its clerk have the powers and duties vested in the legislative bodies of cities and their clerks by the general laws described in Section 22229. Thereafter the board of directors of the district and its secretary have these powers and duties.
The canvass of the returns of the election shall be made at the time, in the manner, and by the officers prescribed by law for special elections in each affected county.
If the canvass is made by an officer other than the board of supervisors of the affected county, the officer shall transmit the results to the board of supervisors. The board of supervisors shall declare the result of the election.
ARTICLE 5. Establishment of District [22256. - 22259.]
By a resolution entered on its minutes, the board of supervisors of each affected county shall declare the district formed if:
A majority of the votes cast at the election is for the formation of the district.
A majority of the votes cast in a majority in number of the cities included in whole or in part in the district, counting all of the unincorporated territory in each affected county as a city for this purpose, is for the formation of the district.
The resolution shall contain the name of the district and a description or other designation of its boundaries.
A certified copy of the resolution shall be recorded in the office of the recorder of each affected county.
Upon the filing with the Secretary of State, the formation of the district is complete.
CHAPTER 3. Internal Organization [22401. - 22443.]
ARTICLE 1. Board of Directors [22401. - 22411.]
A board of five directors is the governing body of the district. Each director shall be a resident of the district.
Each district shall hold a general district election, governed by the provisions of the Uniform District Election Law, for the election of directors on the first Tuesday after the first Monday in November of each odd-numbered year.
Within 30 days after notice of election or appointment each member of the board shall qualify by taking the official oath of office and filing it with the clerk of the principal county.
The terms of office of the directors elected at the formation election are governed by the provisions of the Uniform District Election Law.
The board shall fill any vacancies occurring in the office of director. The appointee shall hold office for the balance of the term and until his successor is elected and qualified.
Each member of the board of directors shall receive compensation in an amount not to exceed one hundred dollars ($100) for each attendance at the meeting of the board held within the district, which amount shall be fixed from time to time by the board. A director shall not receive pay for more than six meetings in any calendar month. The board of directors shall, commencing January 1, 2019, if the district compensates its members for more than four meetings per calendar month, adopt a written policy, based on a finding supported by substantial evidence, why more than four meetings per month are necessary for the effective operation of the district. The board of directors, by ordinance adopted pursuant to Chapter 2 (commencing with Section 20200) of Division 10 of the Water Code, may increase the amount of compensation received for attending meetings of the board by no more than 5 percent annually.
Each director shall be allowed, with the approval of the board, all traveling and other expenses necessarily incurred by the member in the performance of the member’s duties. For purposes of this section, the determination of whether a director’s activities on any specific day are compensable shall be made pursuant to Article 2.3 (commencing with Section 53232) of Chapter 2 of Part 1 of Division 2 of Title 5 of the Government Code. Reimbursement for these expenses is subject to Sections 53232.2 and 53232.3 of the Government Code.
The board shall hold its first meeting in the meeting room of the board of supervisors of the principal county at 10 a.m. on the first Monday after the formation of the district.
At its first meeting the board shall provide for the time and place of holding its meetings and the manner in which special meetings may be called. The board may establish rules for its proceedings.
A majority of the board constitutes a quorum for the transaction of business.
A district may destroy a record pursuant to Chapter 7 (commencing with Section 60200) of Division 1 of Title 6 of the Government Code.
ARTICLE 2. Officers and Employees [22436. - 22443.]
At its first meeting the board shall choose one of its members president. The president shall sign all contracts on behalf of the district and perform such other duties as may be imposed by the board.
At its first meeting or as soon thereafter as practicable, by a majority vote the board shall appoint a general manager, a secretary, a district counsel, and an auditor. These officers shall serve at the pleasure of the board. The board shall fix their compensation.
The secretary shall countersign all contracts on behalf of the district and perform such other duties as may be imposed by the board.
The general manager has the following powers and functions:
Full charge and control of the construction, maintenance, and operation of the physical properties of the district.
Except as otherwise provided in this article, full power to employ and discharge all employees and assistants at pleasure, prescribe their duties, and, subject to the approval of the board, to fix their compensation.
Such other duties as may be imposed by the board.
The general manager shall report to the board in accordance with rules and regulations adopted by the board.
The auditor shall install and maintain a system of auditing and accounting which shall competently and at all times show the financial condition of the district. He shall draw warrants to pay demands made against the district if the demands have been approved by at least three directors.
The board shall designate depositories for the custody of the funds of the district. A depository shall give security sufficient to secure the district against possible loss and shall pay the warrants drawn by the auditor for demands against the district under such rules as the board may prescribe.
The general manager, secretary, auditor, and all other employees or assistants of the district who may be required to do so by the board, shall give bonds to the district conditioned for the faithful performance of their duties as the board may prescribe.
CHAPTER 4. Powers and Duties [22551. - 22559.]
Except as otherwise provided in this part, the powers of the district shall be exercised by the board.
A district has perpetual succession.
A district may do all of the following:
Sue and be sued, except as otherwise provided by law, in all actions and proceedings in all courts and tribunals of competent jurisdiction.
Adopt a seal and alter it at pleasure.
Provide and maintain public airports, spaceports, and landing places for aerial and space reentry traffic.
Acquire by purchase, condemnation, donation, lease, or otherwise, real or personal property necessary to the full or convenient exercise of any of its powers or purposes.
Improve, construct or reconstruct, lease, furnish or refurnish, use, repair, maintain, control, sell, or dispose of the property of the district, including any buildings, structures, lighting equipment, and all other equipment and facilities necessary for those purposes.
The board of directors may, from time to time, cause to be sold or leased property of the district which in its opinion is not needed for the district’s affairs.
Such sales, at the discretion of the board of directors, may be on time, provided at least 20 percent of the total consideration be paid in cash at the time of the transaction and the remainder thereto be paid within 10 years and evidenced by a promissory note payable to the order of the district bearing interest at the rate of at least 5 percent per annum secured by a first mortgage, first deed of trust, or other prior encumbrance upon the property being sold.
Property may be leased for any purpose and to any party whenever the board of directors finds that such lease does not interfere with use of such property for the purposes of the district or with the operations of the district. All rents and other consideration received by the district shall be paid into its general fund for the use of the district.
A district may also:
Employ legal counsel, in addition to its district counsel, and provide all necessary custodians, employees, engineers, and attendants for the proper maintenance of the property of the district and the conduct of the affairs of the district, for any of its purposes.
Borrow money, incur indebtedness, issue bonds or other evidence of the indebtedness, and refund or retire any indebtedness of the district.
Cause to be levied and collected, taxes for the purpose of maintaining and carrying on the operations of the district and paying its obligations.
Make contracts, employ labor, and do all acts necessary or convenient for the full exercise of any of the powers of the district.
The board shall make all rules governing the use of the airports and spaceports, landing places for aerial traffic, and other aerial facilities of the district that the board determines to be necessary.
The board may charge and collect fees, tolls, and rentals for the use of all or a part of the aerial facilities of the district in such amounts and at such rates as, so far as possible, will produce revenues sufficient to pay the operating expenses of the district, provide for repairs and depreciation of the properties of the district, pay the interest on the bonded indebtedness of the district, and provide a sinking or other fund for the payment of the principal of the indebtedness as it becomes due.
The district may issue temporary negotiable notes bearing interest at a rate not exceeding 8 percent per annum. However, these notes shall be general obligations of the district payable from revenues and taxes, unless paid from other available funds of the district, in the same manner as bonds of the district. The maturity of the notes shall not be later than 20 years from the date thereof, and the total aggregate amount of the notes outstanding at any one time shall not exceed 2 percent of the assessed valuation of the taxable property in the district, or if the assessed valuation is not obtained, 2 percent of the county auditor’s estimate of the assessed valuation of the taxable property of the district evidenced by his or her certificate. The total aggregate amount of these notes outstanding at any one time shall further not exceed the sum of five hundred thousand dollars ($500,000).
Any note proposed to be issued pursuant to subdivision (a) with a term longer than five years shall not be issued until after a public hearing is conducted with respect to the issuance and a resolution is adopted approving the issuance. At least 15 days prior to the public hearing, the board shall cause notice of the hearing to be published pursuant to Section 6061 of the Government Code in a newspaper published in the principal county. The resolution shall be subject to referendum pursuant to Section 9340 of the Elections Code and shall so provide. Within 15 days after adoption of the resolution of issuance, the board shall cause the resolution to be published at least once in a newspaper of general circulation published in the principal county, or if there is none, posted in at least three public places in the district.
Notwithstanding Section 22557, the Big Bear Airport District may issue temporary negotiable notes bearing interest at a rate not exceeding the maximum rate permitted pursuant to Section 53531 of the Government Code. These notes shall be general obligations of the district payable from revenues and taxes, unless paid from other available funds of the district, in the same manner as bonds of the district. The notes shall mature not later than 20 years from the date thereof, and the total aggregate amount of notes outstanding at any one time shall not exceed 2 percent of the assessed valuation of the taxable property in the district, or if the assessed valuation is not obtained, 2 percent of the county auditor’s estimate of the assessed valuation of the taxable property of the district evidenced by the auditor’s certificate. The total aggregate amount of notes outstanding at any one time shall further not exceed one million five hundred thousand dollars ($1,500,000).
Any note proposed to be issued pursuant to subdivision (a) with a term longer than five years shall not be issued until after a public hearing is conducted with respect to the issuance and a resolution is adopted approving the issuance. At least 15 days prior to the public hearing, the board shall cause notice of the hearing to be published pursuant to Section 6061 of the Government Code in a newspaper published in the principal county. The resolution is subject to referendum pursuant to Section 9340 of the Elections Code and shall so provide. Within 15 days after adoption of the resolution of issuance, the board shall cause the resolution to be published at least once in a newspaper of general circulation published in the principal county, or if there is none, posted in at least three public places in the district.
In addition to all other powers authorized by this part, the Santa Maria Public Airport District may do both of the following:
Employ airport police officers in accordance with subdivision (d) of Section 830.33 of the Penal Code.
Pursuant to Chapter 4 (commencing with Section 6300) of Division 7 of Title 1 of the Government Code, apply for, establish, operate, and maintain a foreign trade zone and subzones thereto, and allow in the foreign trade zone and the subzones thereto any properties and businesses that are located either within or outside the geographic boundaries of the district and that are located within either the County of Santa Barbara or the County of San Luis Obispo.
The board may by resolution change the name of the district. Certified copies of such resolution shall be recorded in each county within which some portion of the territory of the district is situated and shall be transmitted to the Secretary of State and to the clerk of each such county.
CHAPTER 4.5. Claims [22601. - 22601.]
CHAPTER 5. Bonds [22701. - 22851.]
ARTICLE 1. General [22701. - 22708.]
As used in this chapter, “board of supervisors” means the board of supervisors of the principal county.
District bonds may be issued and sold pursuant to this chapter for all of the following purposes:
Raising money for purchasing real property for airport and spaceport purposes.
Building and purchasing buildings or structures including hangars, or making alterations, additions, or repairs to the buildings or structures.
Restoring or rebuilding buildings or structures damaged or destroyed by fire or other public calamity.
Supplying buildings, structures, and hangars with furnishings and necessary apparatus.
Improving the grounds of airports and spaceports.
Acquiring and maintaining lighting equipment and all other equipment, devices, and facilities necessary or convenient for the airports and spaceports.
Liquidating any indebtedness incurred for these purposes or refunding any valid outstanding indebtedness of the district evidenced by bonds or warrant.
Paying all costs and expenses incident to the bond election, including engineering, architectural, legal charges, fiscal agent’s charges and interest during construction and for a period of not to exceed 12 months after the date of completion of construction.
If the board deems it advisable it may call an election and submit to the electors of the district the question whether district bonds shall be issued and sold. The board shall call a bond election upon the filing with the board of a petition signed by 10 percent of the registered voters of the district.
The board shall call and conduct the bond election in the manner prescribed by this chapter.
The order calling the bond election shall be signed by a majority of the directors.
In the order calling the bond election, the board may submit to the electors as one proposal the question of issuing bonds for all or any of the purposes described in this article, or it may submit as separate questions the issuance of bonds for any of these purposes, singly or in such combinations as it directs in the order.
When bonds issued pursuant to this part have been investigated and certified by any authorized officer of the state and are declared to be legal investments for savings banks, they may be purchased or received in pledge for loans by savings banks, building and loan companies, trust companies, insurance companies, guardians, conservators, executors, administrators, and special administrators, or by any public officer of the state or of any county or other municipal or corporate body in the state having or holding funds which they may legally invest or loan.
If any officer whose signature, countersignature, or attestation appears on the bonds or coupons ceases to be such officer before the delivery of the bonds to the purchaser, the signature, countersignature, or attestation is valid and sufficient for all purposes as if he had remained in office until the delivery of the bonds. The signature on the coupons of the person who is auditor at the date of the bonds is valid although the bonds may be attested by a different person who is auditor at the time of their delivery.
ARTICLE 2. Bond Election [22731. - 22750.]
A notice of the bond election, signed by a majority of the directors, shall be posted in three public places in the district not less than 20 days before the election and shall be published in each affected county pursuant to Section 6063 of the Government Code.
The notice shall contain:
The time and place of holding the bond election.
The names of the election officers.
The hours the polls will be open.
A statement of the purpose for which the election is held.
The amount and denomination, the rate of interest, and the term, not exceeding 40 years, of the proposed bonds.
For the purpose of the bond election, the board may divide the district into election precincts and may change the precincts as often as occasion requires.
The board shall appoint one inspector, one judge, and two clerks of election in each precinct.
If the board fails to appoint the election officers, or if those appointed are not present at the opening of the polls, the electors present may appoint them and they shall conduct the election.
The board may fix the compensation of the election officers but not exceeding seven dollars ($7) for each election officer.
The polls shall be open on election day from 8 a.m. until 8 p.m.
Every resident of the district, who is a qualified elector of the county, and who is registered in the precinct where the election is held at least 30 days before the election, may vote in the election.
The secretary shall obtain uniform ballots for the bond election. No other form of ballot shall be used. The expense of printing and distributing the ballots to the polling places shall be paid as other current expenses of the district are paid.
The ballot shall contain the following:
“Official ballot provided by the board of directors of the ‛____ airport district’ to be used in the bond election of said district in the county of ____, State of California, on the ____ day of ____ 20__.”
Other matters required by law.
To the right of or below the bond proposition on the ballot, the words “Yes” and “No” on separate lines, with voting targets.
The board shall provide a booth or private room in which the voter may prepare his ballot in secret.
No electioneering shall be carried on within 100 feet of the polls.
Each voter shall completely select the voting target next to either “Yes” or “No” respectively, to indicate whether the voter has voted for or against the issuance of the bonds.
After marking his ballot the voter shall hand it to the inspector. The inspector, in the presence of the voter, shall deposit the ballot in the ballot box. The judge or clerks shall enter the voter’s name on the poll list.
Any person offering to vote may be challenged by any elector of the district. In the case of a challenge the judge or clerks of the election shall administer to the person challenged an oath substantially as follows: “You do swear that you are a citizen of the United States, that you are 21 years of age, that you have resided in this State one year, in this county 90 days, and in this airport district 30 days preceding this election, and that your name is on the great register of this county and was on the great register of a precinct in this airport district at least 30 days before this election, and that you have not before voted this day.” If the person challenged takes this oath his vote shall be received. Otherwise his vote shall be rejected.
The secretary shall provide the election officers with official poll and tally lists.
The heading of the poll list shall read “Official poll list of ____ airport district for the airport district bond election on the ____ day of ____ 19__.” Under this heading shall be arranged three columns. The heading of the first column shall read “Write your name as it appears on the great register of this county.” The heading of the second column shall read “Write your residence, street and number, city, and airport district.” The heading of the third column shall read “Are you a qualified registered voter in this airport district?” The person offering to vote shall write his name on the first column of the poll list, give his residence in the second, and in the third shall write the word “Yes” or “No.” If he writes the word “No” he shall not be permitted to vote. Persons writing the word “Yes” may be challenged pursuant to this article.
The heading of the tally list shall read “An official tally list of ____ airport district for the airport district bond election held on the ____ day of ____ 19__.” It shall be arranged so that the propositions to be voted on at the election may be set forth. It shall be vertically ruled to provide for the counting of votes under a tally system. The heading of the final column shall read “Total votes cast for the bonds” and “Total votes cast against the bonds.” A space shall be provided at the bottom of the page for the signatures of the election officers. Over these signatures shall be printed the words “We hereby certify that this is a correct report of the election held in ____ airport district in the county of ____ on the ____ day of ____ 19__.”
The election officers shall publicly canvass the votes immediately after closing the polls. They shall fill out the tally sheet and certify the correctness of the canvass. They shall make, sign, and deliver a certificate of the result of the election and transmit it to the clerk of the board of supervisors.
The election officers shall transmit the returns of the election to the board of directors. The board shall meet and canvass the returns on the seventh day after the election at 2 p.m.
ARTICLE 3. Bond Issuance [22776. - 22786.]
If two-thirds of the votes cast at the election were for the issuance of bonds, the board shall enter that fact in its minutes. The board shall certify all of the board proceedings to the board of supervisors.
The board of supervisors shall issue the district bonds in the number and amount specified in the bond proceedings. The board of supervisors shall provide that the bonds are payable out of the interest and sinking fund of the district, naming the fund, and that the money for redemption of the bonds and payment of the interest shall be raised by taxation upon the taxable property in the district.
By an order entered in its minutes, the board of supervisors shall:
Prescribe the form of the bonds and of the interest coupons.
The manner in which the bonds shall be executed.
Fix the time when all or any part of the principal of the bonds is payable.
The total amount of bonds issued shall not exceed 15 percent of the taxable property of the district as shown by the last equalized assessment books of the affected counties.
The term of the bonds shall not exceed 40 years.
The bonds shall be payable in lawful money of the United States as to principal and interest.
The board of supervisors may make the principal and interest of the bonds payable at the office of the treasurer of the principal county, at such other place within the United States as the board may designate, or at the county treasurer’s office or such other designated place at the option of the bondholders. The place of payment shall be specified in the bonds. The expense of paying the principal and interest other than at the office of the county is a charge against the district funds, to be paid out of the tax for the payment of the bonds.
The bonds shall be sold at the times and in the amounts prescribed by the board of supervisors, but for not less than par.
Before selling all or any part of the bonds, the board of supervisors shall advertise for bids pursuant to Section 6066 of the Government Code in a newspaper of general circulation published in the principal county, or if no such newspaper is published in the county, in some newspaper published in another county.
If satisfactory bids are received the bonds offered for sale shall be awarded to the highest bidder. If no bids are received or the board of supervisors determines that the bids received are not satisfactory as to price or responsibility of the bidders, the board of supervisors may reject all bids received and either re-advertise or sell the bonds at private sale.
The proceeds of the sale of the bonds shall be deposited in the treasury of the principal county to the credit of the improvement fund of the district, and may be withdrawn for the purposes for which the bonds were voted as other district money is withdrawn.
ARTICLE 4. Cancellation of Unsold Bonds [22811. - 22814.]
If any bonds remain unsold for six months after having been offered for sale, the board of directors of the district for which the bonds were issued or of a district containing any territory which at the time of the bond election was embraced within the district for which the bonds were issued, may petition the board of supervisors to cause the unsold bonds to be withdrawn from the market and canceled.
Upon receiving a petition signed by a majority of the members of the board of directors, the board of supervisors shall fix a time for hearing the petition. The hearing shall be held not more than 30 days after receipt of the petition.
The board of supervisors shall publish a notice stating the time and place of the hearing and the object of the petition in general terms, pursuant to Section 6062 of the Government Code in a newspaper published in the district or, if there is no such newspaper, in a newspaper published at the county seat of an affected county.
At the time and place designated in the notice, or at any subsequent time to which the hearing is postponed, the board of supervisors shall hear any reason that may be submitted for or against the granting of the petition. If the board of supervisors deems it for the best interest of the district named in the petition that the unsold bonds be canceled, it shall make and enter an order in its minutes that the unsold bonds are canceled. Thereafter the bonds and the vote by which they were authorized to be issued have no validity whatever.
ARTICLE 5. Revenue Bonds [22850. - 22851.]
In addition to any other powers of the district to finance improvements and to provide an independent method of financing from that contained in any other sections of the California Airport District Act, subject to the provisions of this article a district may borrow money to provide funds to pay all costs of any public improvement authorized by this part and may issue revenue bonds to evidence the indebtedness created by such borrowing.
Such revenue bonds shall constitute special obligations and evidence a special indebtedness of the district which shall be a charge upon and payable as to the principal thereof, interest thereon, and any premiums upon the redemption of any thereof, solely from such revenues and funds as are specified therein and in the proceeding for their issuance. They shall not constitute general obligations of the district, and they shall neither constitute obligations nor evidence any indebtedness of any other public agency of which the district may be a part or of the State.
All such bonds shall recite upon their face the substance of the preceding portions of this section and shall also recite upon their face that they are issued under this article.
Revenue bonds under this article shall be authorized, issued and sold under the provisions of the Revenue Bond Law of 1941 (Chapter 6 (commencing with Section 54300), Part 1, Division 2, Title 5, Government Code).
CHAPTER 6. Taxation [22901. - 22909.]
As used in this chapter, “board of supervisors” means the board of supervisors of the principal county.
If the revenues of the district are inadequate to pay the interest or principal of the bonded indebtedness of the district as it becomes due, or to pay any other expenses of or claims against the district, the board of directors shall transmit to the board of supervisors and the county auditor a written estimate of the minimum amount of money required for the payment of the principal and interest of the bonded indebtedness as it becomes due, and of the minimum amount of money required by the district for any other purpose.
The board shall transmit the estimates to the board of supervisors and the county auditor at least 15 days before the first day of the month in which the board of supervisors is required to levy taxes for county purposes.
Annually, after receiving the estimates, the board of supervisors shall levy a tax sufficient for the payment of the principal and interest on the bonded indebtedness, designated as the “____ airport bond tax,” and a tax sufficient for the payment of all other expenses of, and claims against, the district, designated as the “____ airport district tax.”
The bond tax shall be levied annually until the bonded indebtedness is fully paid. The district tax shall be levied annually until all other expenses of and claims against the district are fully paid.
The bond tax shall be sufficient to pay the interest on the bonds for the year and the portion of the principal becoming due during the year. The bond tax shall also be sufficient to raise annually for the first half of the term of the bonds a sum sufficient to pay the interest for that period, and, during the balance of the term, sufficient to pay the annual interest and to pay annually a proportion of the principal equal to the amount produced by dividing the total amount of outstanding bonds by the number of years the bonds then have to run.
The proceeds of the bond tax shall be paid into the treasury of the principal county to the credit of the district interest and sinking fund and shall be used only for the payment of the principal and interest on the bonds. The treasurer of the principal county shall pay the principal and interest on the bonds upon the warrant of the auditor of the principal county out of this fund. The county auditor shall cancel and retain the bonds and coupons when he draws his warrants on the treasurer in favor of the owners.
The rate of the district tax levied in any one year shall not exceed twenty cents ($0.20) on each one hundred dollars ($100) of assessed valuation of the real and personal property in the district, exclusive of the bond tax.
The bond and district taxes shall be levied on all the taxable property in the district. They shall be levied by the board of supervisors and collected by the tax collector of the principal county at the time and in the manner and form as county taxes are levied and collected. The proceeds of the taxes shall be paid to the district. The taxes become delinquent at the same time as county taxes and bear the same penalties for delinquency. The taxes are a lien on all taxable property in the district, have the same force and effect as liens for county taxes, and their collection shall be enforced by the same means as liens for county taxes.
A district may impose a special tax pursuant to Article 3.5 (commencing with Section 50075) of Chapter 1 of Part 1 of Division 1 of Title 5 of the Government Code. The special taxes shall be applied uniformly to all taxpayers or all real property within the district, except that unimproved property may be taxed at a lower rate than improved property.
PART 5. AIRCRAFT FINANCIAL RESPONSIBILITY ACT [24230. - 24410.]
CHAPTER 1. General Provisions and Definitions [24230. - 24247.]
This part may be cited as the Uniform Aircraft Financial Responsibility Act.
This part shall be so interpreted and construed as to effectuate its general purpose to make uniform the laws of those states which enact it.
Unless the context otherwise requires, the definitions and general provisions set forth in this chapter govern the construction of this part.
“Department” means the Department of Aeronautics in the Business and Transportation Agency.
“Aircraft” means any contrivance now known, or hereafter invented, used or designed for navigation of or flight in the air.
“Judgment” means any judgment which has become final by expiration without appeal of the time within which an appeal might have been perfected, or by final affirmation on appeal, rendered by a court of competent jurisdiction of any state or of the United States, upon a claim for damages suffered by a claimant arising out of the ownership, operation, maintenance or use of any aircraft, including damages for care and loss of services, because of bodily injury to or death of any person or injury to or destruction of property, including the loss of use thereof, or upon an agreement of settlement for such damages.
“Operator” means any person who is exercising actual physical control of an aircraft.
“Owner” means any of the following persons who may be legally responsible for the operation of an aircraft:
A person who holds the legal title to an aircraft.
A lessee of an aircraft.
A conditional vendee, a trustee under a trust receipt and a mortgager or other person holding an aircraft subject to a security interest.
“Passenger” means any person in, on or boarding an aircraft for the purpose of riding therein, or alighting therefrom following a flight or attempted flight therein.
“Person” means any individual, firm, copartnership, association or corporation, public or private, including his or its successors, assignees or legal representatives.
“Notification” means notice in writing served upon a person by either:
Actual delivery or offer of delivery to such person by any adult individual whose rights are not affected by the proceeding involved; or
Registered mail addressed to the person at the last address known to the division.
“State” means any state, the District of Columbia, any territory or possession of the United States and the Commonwealth of Puerto Rico.
“Claimants” means any person having a claim for damages as the result of an accident within this state involving an aircraft.
This part does not apply to:
Any aircraft owned and operated by or leased to and subject to the sole control of the United States or any civil or military agency of the United States or of the District of Columbia, the Commonwealth of Puerto Rico or any territory or possession of the United States.
Any aircraft owned and operated by or leased to and subject to the sole control of this or any other state or agency thereof or any political subdivision or municipality of this or any other state.
Any aircraft owned and operated by or leased to and subject to the sole control of any foreign country or any civil or military agency thereof or any political subdivision or municipality thereof.
Any commercial air operator subject to Chapter 9 (commencing with Section 5500) of Division 2.
Any aircraft operated by an operator subject to the provisions of Article 2 (commencing with Section 11931) of Chapter 5 of Division 6 of the Agricultural Code.
Any person who maintains in effect an insurance policy meeting the requirements of Section 24350 and who has filed with the department a certificate of insurance issued by the insurance company which issued such policy; provided, however, that such person shall, in accordance with the provisions of Section 24300, report each aircraft accident in which he is involved as operator or owner of aircraft.
This part shall not apply with respect to any accident occurring prior to the effective date of this part.
Nothing in this part shall be construed as precluding any party in any action or proceeding from employing other processes provided by law. Nothing in this part shall be construed as precluding the utilization by the department of the injunctive or other process of the courts in aid of the enforcement of this part.
A discharge in bankruptcy shall not relieve any person from the requirements of this part.
Nothing in this part shall be construed as authorizing the state to license the operators of aircraft.
CHAPTER 2. Administration [24250. - 24254.]
The department shall administer and enforce the provisions of this part and may make rules and regulations necessary for its administration.
Nothing in this part shall be construed as requiring any license for operators of aircraft other than that required by the federal government, or to permit any registration of aircraft by the state.
The department shall provide for hearings upon request of any person who may be affected by its orders or acts under the provisions of this part and may provide for a stay thereof until a hearing may be had. All hearings held under this part shall be conducted in accordance with Chapter 5 (commencing with Section 11500), Part 1, Division 3, Title 2 of the Government Code, and the department shall have all of the powers granted therein.
The records of and proceedings before the department shall be inadmissible in evidence and shall not be referred to at the trial of any civil action or criminal proceeding.
Subject to the foregoing provisions, the department shall, upon written request, make available to persons whose legal rights may be affected thereby, information and material developed in the course of its administration of this part.
The operation of an aircraft on the land or waters of, or in the air over, this state shall be deemed an appointment by the owner or operator of the department to be his true and lawful attorney upon whom may be served all legal process in any action or proceeding against him, arising from the ownership, maintenance, use or operation of such aircraft and resulting in damage or loss to person or property, and said use or operation shall be signification of their agreement that any such process against him which is so served, shall be of the same legal force and validity as though served upon him personally; provided, such person is a nonresident of this state or at the time a cause of action arises is a resident of this state but subsequently becomes a nonresident of this state.
Service of such process shall be made by leaving a copy of the summons and complaint with the department or in its office at Sacramento, together with a fee of two dollars ($2), and by the mailing of a copy of such summons and complaint by the plaintiff or his attorney to the defendant, and to each of the defendants if more than one at his last known address, within 10 days thereafter by registered mail. In lieu of such mailing to such defendant in a foreign state, plaintiff may cause a copy of the summons and complaint to be served personally in the foreign state upon such defendant by any adult person not a party to the suit, by actually delivering the same to such defendant or by offering to make such delivery in case defendant refuses to accept delivery.
Proof of the service of such process upon the department, and proof of the mailing or personal delivery thereof to the defendant, shall be made by the affidavit or affidavits of the party or parties doing the acts, which shall be filed with the court from out of which such summons issued, within such time as the court may allow for the return of such summons. Process shall be deemed to be completed upon the filing of such affidavit or affidavits and of the original registry receipt issued by the post office upon the mailing of such registered letter, if service is obtained by mail.
CHAPTER 3. Security Following Accident [24300. - 24362.]
ARTICLE 1. Accident Report [24300. - 24302.]
The operator of any aircraft involved in an accident within this state in which any person is killed or injured or damage in excess of four hundred dollars ($400), is sustained to the property of any person, other than property owned by the owner or operator, or in his care, custody or control, or carried in or on the aircraft, shall immediately but not later than 15 days after the accident report the matter in writing to the department. If the operator is physically incapable of making the report, the owner of the aircraft involved in the accident, shall immediately but not later than 15 days after learning of the accident, make the report. If neither the operator nor the owner is physically capable of making the report, then each passenger shall, within 15 days after learning of the incapacity of the operator or owner, make the report. If the owner or operator dies as a result of the accident, the legal representative of the operator or owner shall make the report within 15 days after his qualifications. The sheriff of the county in which the accident occurred, or the chief of police of the city in which the accident occurred, as the case may be, shall notify the department in writing immediately but not later than 15 days after learning of the accident.
The report, the form of which shall be prescribed by the department, shall include information to enable the department to determine whether the requirements for the deposit of security under Article 2 (commencing with Section 24325) are inapplicable by reason of existence of insurance or other exceptions specified in this part. The department may rely upon the accuracy of the information until it has reason to believe that the information is erroneous.
The operator and the owner shall furnish such additional information as the department may require.
ARTICLE 2. Security [24325. - 24327.]
As promptly as practicable but not later than 30 days after receipt of an accident report as required in Article 1 (commencing with Section 24300), the department shall determine by an order entered of record (a) the amount of security within the limits specified in Section 24350, which it deems sufficient to satisfy any judgment for damages resulting from the accident which may be recovered against each owner or operator, and (b) the name and address of each claimant.
As promptly as practicable but not later than 30 days after the entry of the order required by Section 24325, the department, the owner or the operator, or both, as the case may be, shall deposit for the benefit of the owner or operator or both, as the case may be, security in the sum so determined by the department.
The requirements as to security do not apply:
To the operator of an aircraft involved in an accident in which no injury was caused to the person of anyone other than the operator or guests, and no damage in excess of four hundred dollars ($400) was caused to property not owned, rented, occupied or used by such operator nor in his care, custody or control nor carried in or on the aircraft.
To the operator or owner of an aircraft if at the time of the accident the aircraft was stationary, without passengers thereon or boarding the aircraft or alighting therefrom and the aircraft was parked in an area legally used for aircraft parking with no engine running nor in the process of being started.
To the owner of an aircraft if at the time of the accident the aircraft was being operated, or was parked, without his permission, express or implied.
To the owner if there is in effect at the time of the accident an aircraft liability policy or bond with respect to the aircraft involved in the accident.
To the operator, if not the owner of the aircraft, if there is in effect at the time of the accident an aircraft liability policy or bond with respect to his operation of the aircraft involved in the accident.
To the operator or owner if his liability for damages resulting from such accident is covered by any other form of liability insurance policy or bond in effect at the time of the accident.
To any person qualifying as a self-insurer under Section 24353, or to any person operating an aircraft for the self-insurer for whose acts the self-insurer is legally responsible.
After there is filed with the department satisfactory evidence that the person otherwise required to deposit security has (1) been released from liability, or (2) been adjudicated not to be liable by judgment, or (3) executed a written agreement with all claimants providing for payment of an agreed amount with respect to all claims for injuries or damages resulting from the accident.
ARTICLE 3. Financial Responsibility [24350. - 24362.]
A policy or bond is not effective under Article 2 unless:
Issued either (1) by an insurer or surety company authorized to do business in this state, or (2) by an insurer or surety company not authorized to do business in this state but which is found by the department to afford adequate protection and which has filed or shall file with the department a power of attorney authorizing the department to accept service on his behalf of notice or process in any action upon the policy or bond arising out of such accident.
If the accident results in bodily injury to or death of a person not a passenger, the policy or bond provides coverage of not less than fifty thousand dollars ($50,000) because of bodily injury to or death of one person in any accident and one hundred thousand dollars ($100,000) because of bodily injury to or death of two or more persons in any one accident.
If the accident results in damage to or destruction of property, the policy or bond provides coverage of not less than fifty thousand dollars ($50,000) because of damage to or destruction of property in any one accident with the exception of the following property which is exempted from the security required under this part: property owned, rented, occupied or used by, or in the care, custody or control of the owner or operator or carried in or on the aircraft.
The policy or bond need not cover:
Any liability on account of bodily injury to or death of any employee of the owner or operator while the employee is engaged in the duties of the person’s employment.
Any obligation for which the owner or operator or the insurer of the owner or operator may be held liable under any workers’ compensation law.
A guest, or any other person, riding in or upon any aircraft without giving compensation.
Any liability for bodily injury or death of any occupant riding in or upon an aircraft or exiting an aircraft for purposes of skydiving or sport parachuting when that occupant’s injury or death is solely related to hazardous risks associated with skydiving or sport parachuting activities.
Any person described in paragraph (1) who is not afforded the protection of liability insurance in connection with skydiving or sport parachuting activities shall be provided a notice in at least 14-point type that discloses the fact that no liability insurance is in effect that provides coverage for the skydiving or sport parachuting activities that are being undertaken.
Any person may at any time apply to the department for a certificate of self-insurance, whether or not there has occurred an accident as a result of which he might be affected by some other provision of this part.
The department may in its discretion issue a certificate of self-insurance when satisfied that the applicant is possessed and will continue to be possessed of ability to pay judgments against him within the limits provided in this part.
Upon not less than 10 days notification of a self-insurer the department may for reasonable cause cancel a certificate of self-insurance and shall cancel such certificate upon failure to pay any judgment within 30 days.
The security required under this part shall be cash or securities permissible under state law as security for deposit of state funds and in such amount as the department may require but in no case in excess of the limits specified in Section 24350 in reference to the limits of a policy or bond. If at the time of the accident there is in effect a liability policy or a bond meeting the requisites of this part other than in the amount of coverage set forth in Section 24350, the department may consider such policy or bond in fixing the amount of security. The person depositing security shall specify in writing the person or persons on whose behalf the deposit is made and, at any time while such deposit is in the custody of the state agency with which the deposit is made the person depositing it may, upon approval of the department, amend in writing the specification of the person or persons on whose behalf the deposit is made to include an additional person or persons; provided, however, that a single deposit of security shall be applicable only on behalf of persons required to furnish security because of the same accident.
Upon 10 days notification of the parties concerned, the department may reduce, or, within the limits specified in Section 24350, increase the amount of security ordered in any case if in its discretion the amount ordered is excessive or insufficient. In case the security originally ordered has been deposited, the excess shall be returned to the depositor notwithstanding the provisions of Section 24357. Substitution of security shall be permitted.
Security deposited in compliance with the requirements of this part shall be delivered to the department. The department shall deposit all cash received as security in a special account in the Special Deposit Fund provided by Article 2 (commencing with Section 16370) of Chapter 2, Part 2, Division 4, Title 2 of the Government Code, shall record the receipt of all securities received by it and deposit such securities with the State Treasurer, and shall retain in its custody all original insurance policies or copies thereof delivered to it. Security deposited with any agency other than the department shall be released only:
Upon certificate of the department in the payment of a judgment rendered against the person or persons on whose behalf the deposit was made, for damages arising out of the accident in a civil action, begun not later than one year after the date of the accident or within one year after the date of deposit of any security under subdivision (c) of Section 24330 or in the payment of a settlement, agreed to by the depositor and all the claimants, of a claim or claims arising out of the accident.
Upon certificate of the department issued after 10 days notification of all claimants upon evidence satisfactory to the department that all claims arising from such accident have been satisfied by either (1) a release from liability, or (2) a judgment of nonliability, or (3) a written agreement in accordance with subdivision (h) of Section 24327, or whenever, after the expiration of one year from the time of the accident or from the date of deposit of any security under subdivision (c) of Section 24330 the department is given evidence satisfactory that there is no such action pending and that no judgment rendered in any such action is unpaid.
Upon the certificate of the department that other security complying with Section 24355 and satisfactory in form, character and amount, has been deposited with it in lieu of the original security deposited hereunder.
Upon the death of the person on whose behalf such proof was filed.
In the event of the permanent incapacity of such person to operate an aircraft if the department is furnished proof of such incapacity.
The department shall not release such proof: (1) if any action for damages upon a liability referred to in this part is then pending, or (2) if any judgment upon any such liability is outstanding and unsatisfied.
An affidavit of the applicant of the nonexistence of such facts shall be prima facie evidence thereof.
Any security deposited with the department shall be released by it for any reason authorizing it to issue a certificate pursuant to subdivision (a), (b) or (c) when security is in the custody of another state agency.
Such security shall be available for the following purposes:
Payment of a final judgment or judgments in any amount for bodily injury or in excess of four hundred dollars ($400) for property damage, rendered against the owner or operator on whose behalf the deposit was made, for damages arising out of the accident in an action at law, begun not later than one year after the date of such accident.
Payment of any settlement agreement covering any claim arising out of the accident.
Payment of any final judgment rendered as a result of default under any duly acknowledged settlement agreement.
Every distribution of funds from the security deposit shall be subject to the limits of the department’s evaluation on behalf of a claimant but not in excess of the maximum amounts provided in this part for bodily injury and for property damage.
Every judgment shall for the purposes of this part be deemed satisfied:
When fifty thousand dollars ($50,000) has been credited, upon any judgment in excess of that amount, or upon all judgments, collectively, which together total in excess of that amount, for personal injury to or death of one person as a result of any one accident.
When, subject to the limit of fifty thousand dollars ($50,000) as to one person, the sum of one hundred thousand dollars ($100,000) has been credited upon any judgment in excess of that amount, or upon all judgments, collectively, which together total in excess of that amount, for personal injury to or death of more than one person as a result of any one accident.
When fifty thousand dollars ($50,000) has been credited upon any judgment in excess of that amount, or upon all judgments, collectively, each of which is in excess of fifty thousand dollars ($50,000), and which together total in excess of fifty thousand dollars ($50,000), for damage to property of others as a result of any one accident.
Whenever any evidence of proof of ability to respond in damages filed by any person under the provisions of this part no longer fulfills the purpose for which required the department shall, for the purpose of this part, require other evidence of ability to respond in damages as required by this part.
No insurance policy meeting the requirements of Section 24350 shall be canceled unless 30 days’ prior notice is given to the department by either the insured or the insurance company.
Every person permitting another person to operate an aircraft under the terms of any rental agreement or lease which provides for any remuneration for the use of such aircraft shall deliver either of the following to the person renting the aircraft:
A written certification that an aircraft liability policy of insurance exists for the operator thereof, specifying the name of the insurance company providing such coverage, the policy number, the expiration date of such policy, the nature and extent of coverage, and a statement that such coverage complies with the financial responsibility laws of California applicable to the operation of an aircraft. Such certification shall be furnished and signed, by facsimile or otherwise, by a California licensed insurance agent, broker, or insurance carrier. The person delivering the written authorization provided for herein shall certify as to the accuracy thereof as of the date of delivery.
A written statement that no insurance coverage exists for the operator of the aircraft. Such statement shall be delivered to the person renting the aircraft prior to entering into any binding rental agreement and shall substantially conform to the following text:
“NOTICE TO AIRCRAFT OPERATOR
“You are hereby notified that no insurance coverage is being provided to cover your liability for bodily injury and property damage you may cause as an operator of any aircraft covered by our rental agreement.
“You are further notified that the Uniform Aircraft Financial Responsibility Act (Part 5 (commencing with Section 24230) of Division 9 of the Public Utilities Code) requires that you be able to post security in an amount up to $50,000 because of bodily injury or death to one person in any one accident, up to $100,000 because of bodily injury or death to two or more persons in any one accident, and up to $50,000 in the event of damage to or destruction of property.
“Failure to furnish sufficient security or failure to furnish evidence of proof of ability to respond in damages as required under Section 24325 and Section 24360 of the Public Utilities Code is a misdemeanor.”
No insurance agent, broker, or insurance carrier shall have any liability as a result of the failure to deliver the certificate specified in paragraph (a).
CHAPTER 4. Penalties [24400. - 24403.]
Any owner or operator who knowingly refuses or fails to make any report of an accident as required in Article 1 (commencing with Section 24300) of Chapter 3 of this part shall be guilty of a misdemeanor and upon conviction shall be fined not more than one thousand dollars ($1,000).
Any owner or operator who knowingly makes a false statement or representation of a material fact in a report to or written instrument filed with the department shall be guilty of a misdemeanor and upon conviction shall be fined not less than two hundred fifty dollars ($250) nor more than one thousand dollars ($1,000), or imprisoned for not more than 90 days, or both.
Any owner or operator who refuses or fails to comply with the provisions of Article 2 (commencing with Section 24325) of Chapter 3 of this part or of Section 24360, and who without compliance with such provisions operates any aircraft in this state or knowingly permits any aircraft owned by such person to be operated by another in this state is guilty of a misdemeanor.
Every person permitting another person to operate an aircraft under the terms of any rental agreement which provides for any remuneration for the use of such aircraft who fails to comply with Section 24362 is guilty of a misdemeanor and is punishable by a fine of not less than two hundred fifty dollars ($250) nor more than one thousand dollars ($1,000) or by imprisonment in the county jail for not more than 90 days, or by both such fine and imprisonment.
A failure by a person permitting another person to operate an aircraft under the terms of any rental agreement which provides for any remuneration for the use of such aircraft to obtain a receipt for the delivery of the certification or statement required by Section 24362 to the person renting the aircraft shall be prima facie evidence of a violation of Section 24362.
CHAPTER 5. Declaration of Intent [24410. - 24410.]
It is the purpose of this part to establish minimum standards for aircraft financial responsibility, and nothing in this part shall be construed as preventing any local city or county ordinance from exceeding the minimum insurance requirements prescribed in this part.
PART 6. AIRCRAFT DAMAGE REPORTING [24450. - 24451.]
Any person who causes damage to any aircraft that may reasonably be expected to affect the airworthiness of the aircraft shall do either of the following:
Locate and notify the owner or person in charge of the aircraft of his or her name and address, and upon being requested to do so by the owner of the aircraft or person in charge of the aircraft, present his or her driver’s license or pilot’s license for identification purposes.
Leave in a conspicuous place on the aircraft a written notice giving his or her name, address, and telephone number and a statement of the circumstances thereof, and, without unnecessary delay, notify the nearest safety representative of the Federal Aviation Administration.
Any person failing to comply with the requirements of Section 24550 is guilty of a misdemeanor, and upon conviction thereof, shall be punished by imprisonment in the county jail not exceeding six months, or by a fine not exceeding one thousand dollars ($1,000), or by both that fine and imprisonment.
DIVISION 10. TRANSIT DISTRICTS [24501. - 107025.]
PART 1. TRANSIT DISTRICTS IN COUNTIES OF ALAMEDA OR CONTRA COSTA [24501. - 27509.]
CHAPTER 1. General Provisions [24501. - 24535.]
ARTICLE 1. Definitions [24501. - 24509.]
This part may be cited as the “Transit District Law.”
Notwithstanding any other provision of law, except Section 24826, elections for the Alameda-Contra Costa Transit District shall be conducted in accordance with the Uniform District Election Law (Part 4 (commencing with Section 10500) of Division 10 of the Elections Code). Any costs incurred by county officials shall be paid by the transit district.
Unless the context otherwise requires, the provisions of this article govern the construction of this part.
“District” means a transit district formed under this part; “board” means the board of directors of a district.
“Voter” means any elector who is registered under the Elections Code.
“Transit” means the transportation of passengers and their incidental baggage by any means.
“Transit works” or “transit facilities” means all real and personal property, equipment, rights, or interests owned or to be acquired by the district for transit service.
“Percent of the total vote cast,” when used with reference to the requirements of any petition or nomination paper, means percent of the total vote cast, exclusive of vote by mail ballots, within the proposed district, district, city or territory, as the case may be at the last statewide general election.
“City” includes city and county and incorporated town, but does not include unincorporated town or village.
“Public agency” includes a city, city and county, a county, the State of California, or any public district organized under the laws of the State of California or any agency or authority of any thereof.
ARTICLE 2. General Provisions [24531. - 24535.]
A transit district may be created as provided in this part and when so created may exercise the powers herein granted.
Except as otherwise provided in this part elections shall be held and conducted and the result ascertained, determined, and declared in all respects as nearly as practicable in conformity with the general election laws of the State.
Except as otherwise provided in this part all ordinances and notices which are required to be published shall be published within the district pursuant to Section 6066 of the Government Code.
Whenever in this part publication is required and there is no newspaper of general circulation published within the district, the publication may be made in a newspaper of general circulation published in any county where the district is situated.
Whenever the signature of any officer or employee of a district or of any member of the retirement board or of any officer or employee of the retirement system is authorized or required under this part, except in the single instance provided in Section 26244, the signature may be made by the use of a plate bearing facsimiles of those signatures or by submittal of a digital signature consistent with Section 16.5 of the Government Code or an electronic signature, as defined in subdivision (h) of Section 1633.2 of the Civil Code.
CHAPTER 2. Alameda-Contra Costa Transit District [24561. - 24561.]
The Alameda-Contra Costa Transit District formed pursuant to this section, as it read on January 1, 2021, shall continue in existence unless dissolved pursuant to Chapter 11 (commencing with Section 27501) and is hereby designated a rapid transit district.
CHAPTER 3. Internal Organization of Districts [24801. - 24941.]
ARTICLE 1. Government [24801. - 24801.]
The government of every district is vested in a board of seven directors, elected from wards, together with the other officers mentioned in this part. The directors shall be residents and voters of the respective wards from which they are nominated.
ARTICLE 2. Election of Directors [24821. - 24832.]
The first directors are elected at the formation election as provided in Chapter 2. All elections of directors subsequent to the first shall be held at the same time as the general election in the manner provided in this article.
Notice of election shall be published and no other notice of such election need be given.
The board shall by resolution or ordinance fix the boundaries of the wards for the purpose of electing directors therefrom. The board shall adjust the boundaries of the wards for the purpose of electing directors therefrom pursuant to Chapter 8 (commencing with Section 22000) of Division 21 of the Elections Code.
The notice of election shall refer to the wards established by the board.
Upon the filing of a sufficient nomination paper and affidavit by any candidate the name of the candidate shall go upon the ballot at the ensuing general election.
The nomination paper for a director shall contain the name of the candidate and other information as may be required by this article. The nomination paper shall also meet either of the following requirements:
The nomination paper shall be signed by a minimum of 50 voters of the respective ward.
The nomination paper shall include a filing fee in the amount of one hundred fifty dollars ($150) in lieu of signatures.
All nomination papers shall be filed with, and all in-lieu fees shall be paid to, the county elections official in the county or counties in which the candidate is running.
Nomination papers may be circulated throughout each ward.
Except as otherwise provided in this part, the provisions of the Elections Code prescribed for independent nominations shall substantially govern the manner of appointment of verification deputies, the form of nomination papers and the securing of signatures, the filing of the candidate’s affidavit, and all other things necessary to get the name of the candidate upon the ballot. However, not more than 95 days prior to the election, upon request, the secretary of the district shall issue nomination papers and all other forms required for nomination to the office of director. Verification deputies may obtain signatures to the nomination paper of any candidate at any time not more than 95 days nor less than 74 days prior to the election, and all nomination papers shall be filed with the secretary of the district not more than 90 nor less than 74 days before the date of the election and shall be examined by him. Each candidate, at least 74 days prior to the election, shall file a sufficient candidate’s affidavit. The secretary of the district shall certify the names of all candidates to be placed upon the ballot to the county elections official or county elections officials within the territory affected at least 67 days prior to the date of election.
The board shall in the notice, ordinance, or resolution calling an election consolidate it with the general election to be held at the same time in the respective counties in which the district is located and authorize the respective boards of supervisors to canvass the returns and certify the result of the canvass to the board. It shall be the duty of the board or boards of supervisors to so consolidate the election, canvass the returns, and cause the result thereof to be properly certified to the board of directors of the district. The election shall be held in all respects as if there were only one election, and only one ticket or ballot shall be used.
Candidates for the office of director shall be voted upon and elected one from each ward.
Upon receipt of the returns of the canvass by the respective boards of supervisors the board shall meet and determine results of the election and declare the candidate or candidates elected.
The secretary of the district shall issue certificates of election, signed by him and duly authenticated, immediately following the determination of the result of the election by the board.
ARTICLE 3. Terms of Office of Directors [24862. - 24866.]
At each biennial general election, a number of directors corresponding to the number whose terms of office expire shall be elected for the term of four years.
Effective with the November, 3, 2026, statewide general election, the terms of directors elected shall commence on December 5, 2026, and shall end at noon on January 6, 2031, upon their successors taking office, following the successors’ election in 2030.
Effective with the November 7, 2028, statewide general election, the terms of directors elected shall commence on December 1, 2028, and shall end at noon on January 3, 2033, upon their successors taking office, following the successors’ election in 2032.
On and after January 4, 2033, the terms of directors shall commence on the first Monday after the first day of January following their election.
Every director is subject to recall by voters of the district, in accordance with the recall provisions of the general laws of the State applicable to county officers.
Notwithstanding Section 1780 of the Government Code, the board shall fill all vacancies on the board, including those caused by the death or resignation of a member. If a vacancy exists for 90 days, the Governor shall fill the vacancy.
The person appointed to fill any vacancy on the board shall hold office for the remainder of the unexpired term of his predecessor.
ARTICLE 4. Powers and Duties of Directors [24881. - 24890.]
The oath of office of directors shall be taken, subscribed, and filed with the secretary of the district at any time after the director has notice of his election or appointment but not later than 15 days after the commencement of his term of office. No other filing is required.
The board shall choose one of its members president, and another vice president, who shall be authorized to act for the president during his absence or disability, and shall provide for the time and place of holding its meetings, which shall be held at least once each month.
The board is the legislative body of the district and determines all questions of policy.
All matters and things necessary for the proper administration of the affairs of the district which are not provided for in this part shall be provided for by the board.
The board shall supervise and regulate every transit facility owned and operated by the district, including the fixing of rates, rentals, charges, and classifications, and the making and enforcement of rules, regulations, contracts, practices, and schedules, for or in connection with any transit facility owned or controlled by the district.
The board may adopt a personnel system for the purpose of recruiting and maintaining an effective working force with good morale. The board shall by resolution determine and create such number and character of positions as are necessary properly to carry on the functions of the district and shall establish an appropriate salary, salary range, or wage for each position so created. The board may by resolution abolish any such position. Except as otherwise provided, appointments to such positions shall be made by the general manager.
The board may from time to time contract for or employ any professional service required by the district or for the performance of work or services which cannot satisfactorily be performed by the regular employees of the district.
The board shall have an annual audit made of all books and accounts of the district by a certified public accountant or public accountant.
The board may provide by resolution, under such terms and conditions as it sees fit, for the payment of demands against the district without prior specific approval thereof by the board if the demand is for a purpose for which an expenditure has been previously approved by the board and in an amount no greater than the amount so authorized, and if the demand is approved by the general manager.
To facilitate the business of the district, the board may provide for the creation and administration of such funds as the needs of the district may require. The funds shall be disbursed in accordance with rules established by the board and all payments from any fund shall be reported to the board.
ARTICLE 5. Meetings and Legislation [24906. - 24912.]
All legislative sessions of the board, whether regular or special, are open to the public.
A majority of the board constitutes a quorum for the transaction of business.
The board may, by ordinance or resolution, provide that each director shall be paid a sum that shall not exceed one thousand dollars ($1,000) for each calendar month that they serve as a director. The board may, by ordinance or resolution, provide for an adjustment to the monthly compensation based upon the percentage increase in the California Consumer Price Index, as calculated by the Department of Finance, for the previous calendar year. The adjustment shall not become effective until the first day of the new fiscal year following the adoption of the ordinance or resolution.
The ordinance or resolution to authorize a monthly stipend pursuant to subdivision (a), in lieu of per-meeting compensation, shall include a requirement that a director may receive a monthly stipend for a given month only if the director attends all scheduled and noticed regular board meetings for that month. For those directors meeting this attendance requirement, the amount of one hundred dollars ($100) shall be deducted from the stipend for failure to attend each meeting of a committee on which the director serves that month. In any month that a director fails to meet these attendance requirements, that director may be compensated at the rate of one hundred dollars ($100) per board or committee meeting attended, not to exceed five hundred dollars ($500) for that month.
For the purpose of this section, a director who misses a scheduled and noticed meeting of the board or committee while attending to official district business pursuant to authorization shall be deemed to have attended the meeting.
The ordinance or resolution may provide for not more than two excused absences during a calendar year without disqualifying the director for a monthly stipend.
In addition to the compensation otherwise provided in this section, each director may be allowed necessary traveling and personal expenses incurred solely as a result of the performance of their duties, in amounts as may be authorized by the board. Reimbursement for these expenses is subject to Sections 53232.2 and 53232.3 of the Government Code.
The acts of the board shall be expressed by motion, resolution, or ordinance. No ordinance shall be passed by the board on the day of its introduction, nor within three days thereafter, nor at any time other than a regular or adjourned regular meeting. No ordinance, resolution, or motion shall have any validity or effect unless passed by the affirmative votes of a majority of the directors.
All ordinances shall be published after passage.
The enacting clause of all ordinances shall be as follows:
“Be it enacted by the board of directors of________transit district:”
All ordinances shall be signed by the president of the board or the vice president, and attested by the secretary.
ARTICLE 6. Other Officers [24926. - 24941.]
The board shall appoint and fix the salary of a general manager, who shall have full charge of the acquisition, construction, maintenance, and operation of the facilities of the district and also of the administration of the business affairs of the district.
All other things being equal, the board shall appoint as general manager some person who has had experience in the construction or management of transit facilities.
The general manager need not be a resident of this State at the time of his appointment.
The general manager shall hold office for an indefinite term and may be removed by the board only upon the adoption of a resolution by the affirmative vote of not less than a majority of the board. Before the general manager may be removed, he shall, if he demands it, be given a written statement of the reasons alleged for his removal and he shall have the right to be publicly heard thereon at a meeting of the board prior to the final vote on the resolution providing for his removal, but pending and during such hearing the board may suspend him from office. The board may not reduce the salary of the general manager below the amount fixed at the time of his original appointment except upon the adoption of a resolution by a like vote and after a like opportunity to be heard. The action of the board in suspending or removing the general manager or reducing his salary, if approved by a majority of the membership of the board, is final.
Notwithstanding this article, until such time as the district has operated, controlled, or used facilities or parts of facilities for providing the inhabitants and cities within the boundaries of the district with transit services for a period of six months, the board may or may not appoint a general manager, who during such time holds office at the pleasure of the majority of the board.
The board may appoint a secretary and a general counsel who shall hold office during the pleasure of the board.
The general counsel shall be admitted to practice law in the Supreme Court of the State, and shall have been actively engaged in the practice of law for not less than five years next preceding appointment pursuant to Section 24931.
The secretary, and such assistants as the board may determine, shall have the power to administer all oaths or affirmations required by this part, including the oath of office.
The oath of office of all appointive officers of the district shall be taken, subscribed, and filed with the secretary of the district at any time after the officer has notice of his appointment but not later than 15 days after the commencement of his term of office. No other filing is required.
Each appointive officer shall devote their entire time to the district, meaning that the officer shall not engage in any other business or employment without prior approval from the board.
Subject to the control of the board, the powers and duties of the general manager are:
To have full charge of the acquisition, construction, maintenance, and operation of the facilities of the district.
To have full charge of the administration of the business affairs of the district.
To see that all ordinances of the district are enforced.
To administer the personnel system adopted by the board and except for officers appointed by the board to appoint, discipline or remove all officers and employees subject to the rules and regulations adopted by the board and the labor provisions of this law, whichever are applicable.
To attend all meetings of the board and submit a general report of the affairs of the district.
To keep the board advised as to the needs of the district.
To prepare or cause to be prepared all plans and specifications for the construction of the works of the district.
To devote his entire time to the business of the district.
To perform such other and additional duties as the board may require.
The general manager shall within 180 days from the end of each fiscal year cause to be published a financial report showing the result of operations for the preceding fiscal year and the financial status of the district on the last day thereof. The publication shall be made in the manner provided in this division for the publication of ordinances and notices generally.
The general counsel shall take charge of all suits and other legal matters to which the district is a party or in which it is legally interested. The general counsel shall give their advice or opinion in writing whenever required by the board. The general counsel shall be the legal adviser of the general manager and other district officers and shall prepare or approve the forms of all ordinances, resolutions, contracts, bonds, and other legal documents connected with the business of the district. The general counsel shall perform other and additional services that the board may require.
The general manager shall cause to be installed and maintained a system of auditing and accounting which shall completely and at all times show the financial condition of the district. All warrants for the payment of demands against the district shall be paid in accordance with such rules as the board may establish.
The general manager shall provide for the custody of the funds of the district and the keeping of accounts of all receipts and disbursements. Payments shall be made only upon warrants duly and regularly signed by the president or vice president of the board, or other person authorized by the board so to do, and by the general manager or secretary.
With the consent of the board, the general manager may:
Authorize the trust department of any state or national bank in this State, or a trust company authorized to act as such in this State, to receive as his agent deposits of any securities acquired by the district.
Place and maintain for safekeeping as a trust deposit with the trust department of any state or national bank in this State, or a trust company authorized to act as such in this State, any securities owned by the district.
The bank or trust company selected shall have a total paid-in capital of at least one million dollars ($1,000,000). The general manager shall take from the trust department or trust company a receipt for the securities, and neither the general manager nor the district is responsible for the custody and safe return of the securities until they are withdrawn from the trust department or trust company by the general manager. Any trust department or trust company to which securities are delivered, either as agent or depositary for the general manager, shall make such disposition of the securities as the general manager directs and is responsible only for strict compliance with written instructions given to it by the general manager. All such securities are at all times subject to the order of the general manager.
CHAPTER 4. Labor Provisions [25051. - 25057.]
If a majority of the employees employed by a transit district in a unit appropriate for collective bargaining indicate a desire to be represented by a labor organization, the transit board, after determining pursuant to Section 25052 that the labor organization represents the employees in the appropriate unit, shall bargain with the accredited representative of those employees. Both parties shall bargain in good faith and make all reasonable efforts to reach agreement on the terms of a written contract governing wages, salaries, hours, working conditions, and grievance procedures.
If a dispute arises over the terms of a written contract governing wages, salaries, hours, or working conditions that is not resolved by negotiations conducted in good faith between the transit board and the representatives of the employees, then upon the agreement of both parties, the transit board and the representatives of the employees may submit the dispute to an arbitration board. The decision of a majority of the arbitration board shall be final.
The arbitration board shall be composed of two representatives of the transit board, two representatives of the labor organization, and a fifth member to be agreed upon by the representatives of the transit board and labor organization.
If the representatives of the transit board and labor organization are unable to agree on the fifth member, then the names of five persons experienced in labor arbitration shall be obtained from the California State Mediation and Conciliation Service. The labor organization and the transit district shall, alternately, strike a name from the list supplied by the California State Mediation and Conciliation Service. The labor organization and the transit district shall determine by lot who shall first strike a name from the list. After the labor organization and the transit district have stricken four names, the name remaining shall be designated as the arbitrator.
The transit board and the labor organization shall each pay one-half of the cost of the impartial arbitrator.
A contract or agreement shall not be made with any labor organization, association, group, or individual that denies membership on any basis listed in subdivision (a) of Section 12940 of the Government Code, as those bases are defined in Sections 12926 and 12926.1 of the Government Code. However, the organization may preclude from membership any individual who advocates the overthrow of the government by force or violence.
The district shall not discriminate with regard to employment against any person on any basis listed in subdivision (a) of Section 12940 of the Government Code, as those bases are defined in Sections 12926 and 12926.1 of the Government Code, except as otherwise provided in Section 12940 of the Government Code.
If there is a question whether a labor organization represents a majority of employees or whether the proposed unit is or is not appropriate, such matters shall be submitted to the State Conciliation Service for disposition. The State Conciliation Service shall promptly hold a public hearing and may, by decision, establish the boundaries of any collective bargaining unit and provide for an election to determine the question of representation. Provided, however, any certification of a labor organization to represent or act for the employees in any collective bargaining unit shall not be subject to challenge on the grounds that a new substantial question of representation within such collective bargaining unit exists until the lapse of one year from the date of certification or the expiration of any collective bargaining agreement, whichever is later.
Whenever any district acquires existing facilities from a publicly or privately owned public utility, either in proceedings by eminent domain or otherwise, to the extent necessary for operation of facilities, all of the employees of such public utility whose duties pertain to the facilities acquired who have been employed by said utility for at least seventy-five (75) days shall be appointed to comparable positions in the district without examination and shall be governed thereafter by the personnel system adopted by the board, and these employees shall be given sick leave, seniority and vacation credits in accordance with the records of the acquired public utility.
The provisions of this section shall apply only to those officers or supervisory employees of the acquired utility as shall be designated by the board.
Whenever any district acquires existing facilities from a publicly or privately owned public utility, either in proceedings in eminent domain or otherwise, that has a pension plan in operation, members and beneficiaries of such pension plan shall continue to have the rights, privileges, benefits, obligations and status with respect to such established system; provided, however, that the outstanding obligations and liabilities of such public utility by reason of such pension plan have been considered and taken into account and allowance made for in the purchase price of such public utility.
The persons entitled to pension benefits as provided for in Section 25054 and the benefits which are provided shall be specified in the agreement or order by which any public utility is acquired by the district.
All persons receiving pension benefits from such acquired public utility and all persons entitled to pension benefits under any pension plan of such acquired public utility may become members or receive pensions under the retirement system established by the district as provided for in Chapter 5 (commencing with Section 25301) of this part, or participated in by the district as provided for in Section 25305 of this part, by mutual agreement of such persons and the district. Such agreement may provide for the waiver of all rights, privileges, benefits and status, with respect to the pension plan of such acquired public utility.
Notwithstanding any provisions of the Government Code, the board may authorize payment of any or all of the premiums on any group life, accident and health insurance, health and welfare plan, or pension or retirement plan, on officers or employees of a district. Upon authorization by its employees, a district may make deductions from the wages and salaries of its employees:
Pursuant to a collective bargaining agreement with a duly designated or certified labor organization for the payment of union dues, fees, or assessments.
For the payment of contributions pursuant to any health and welfare, pension, or retirement plan.
For any purpose for which deductions may be authorized by employees of any private employer.
CHAPTER 5. Retirement System [25301. - 25392.]
ARTICLE 1. Establishment [25301. - 25306.]
The board may establish a retirement system for the officers and employees of the district and provide for the payment of annuities, pensions, retirement allowances, disability payments, and death benefits or any of them, provided that the adoption, terms and conditions of any retirement system covering employees of the district, a majority of who are represented by a labor organization in accordance with Chapter 4 (commencing with Section 25051) of this part, shall be pursuant to a collective bargaining agreement between such labor organization and the district.
The district may maintain its own retirement fund or may provide for benefits to eligible officers and employees, or their beneficiaries, by means of group insurance or other insurance, or by such means as in the opinion of the board will satisfactorily provide an adequate and sure method of meeting the payments contemplated by the retirement system.
Before establishing any retirement system the board shall secure a report from a qualified actuary, which shall show the cost of the benefits provided by the system, and the prospective assets and liabilities of the system.
The board may adopt all ordinances and resolutions and perform all acts necessary or convenient to the initiation, maintenance, and administration of the retirement system.
Nothing in this chapter prevents a district from participating in and making all or part of its employees members of the State Employees’ Retirement System by contract entered into between the district and the board of administration of the system under the State Employees’ Retirement Law or from participating in the Federal Social Security Act, or from participating in the retirement system of any other public agency for which it is eligible, and the district may perform all acts necessary or convenient for such participation. Such participation shall not be considered as establishing a retirement system subject to the provisions of this chapter.
The board may classify and determine the officers and employees who shall be included as members in the retirement system and may change the classification from time to time. Membership of all officers and employees so classified and included in the retirement system is compulsory. The retirement system shall not apply to elective officers.
ARTICLE 2. Benefits and Contributions [25331. - 25337.]
The board may prescribe the terms and conditions upon which the officers and employees of the district or their beneficiaries shall be entitled to benefits and the amounts of the benefits.
If a former employee is elected as a board member, the retirement system shall not apply to their service on the board.
The retirement allowance may be predicated in part upon service rendered the district or any predecessor public utility, whether publicly or privately owned, acquired by the district in proceedings in eminent domain or otherwise, by a member prior to the establishment of the retirement system, which service is known as “prior service.”
The board may require the district to contribute the entire cost of the retirement system or may require an officer or employee of the district, upon becoming a member of the retirement system, to contribute a portion of the cost, as permitted or required by law. The amount of the officer or employee contribution shall be determined by the board, as permitted or required by law.
All members of the retirement system shall contribute in the manner and amount fixed by the board and such contributions may be collected by deducting the amounts thereof from the salary, wages, or compensation due such members.
Liabilities accruing under the retirement system because of benefits other than such as are the equivalent of contributions by the members, with accumulated interest, shall be met by contributions by the district. Prior service or other liabilities of the district may be met by annual appropriations instead of by one appropriation for the total of the liabilities; but until the present value of regular contributions for current service, together with assets then available, equals the present value of all allowances and benefits granted or to be granted under the system, the appropriation for any one year when added to any unused balance of any previous appropriations for such purpose shall not be less than the amount disbursed during that year on account of prior service or other liabilities of the district.
If any member withdraws from the retirement system prior to retirement the total amount contributed by him with such interest as may be credited thereto shall be returned to him; provided, however, that the board may prescribe the terms and conditions upon which a member, whose district service is terminated except by death or retirement, may elect to leave his contributions and interest thereon in the retirement fund, and the terms and conditions upon which a retirement allowance may be made to him after such termination.
All money received by any person as an annuity, pension, retirement allowance, disability payment, or death benefit from the retirement system, and all contributions and interest thereon returned to any member of the retirement system, whether in the actual possession of such person or deposited, loaned, or invested by him, is unassignable, and is exempt from execution or any other process except to the extent permitted by Section 704.110 of the Code of Civil Procedure.
ARTICLE 3. Retirement Board [25361. - 25364.]
The board, upon establishing a retirement system pursuant to this chapter, shall create a retirement board of not more than five members, at least two members of which shall be the elected representatives of the employees, to administer the retirement system, and shall define its powers and duties and the tenure of the members.
All members of the retirement board shall serve without pay.
The retirement board shall determine the eligibility of officers, employees, and their dependents to participation in the system and shall be the sole authority and judge under such ordinances as may be adopted by the board as to the conditions under which persons may be admitted to and continue to receive benefits of any sort under the retirement system, and may modify allowances for service and disability. The determination of the retirement board shall be final and conclusive and shall not be modified or set aside except for fraud or abuse of discretion.
If the district maintains its own retirement fund, the retirement board shall have exclusive control of the administration, investment, and disbursement of the retirement fund. The retirement fund is a trust fund held for the exclusive purposes of providing benefits to members of the retirement system and their survivors and beneficiaries. Investment of the fund is subject to the care, skill, prudence, and diligence under the circumstances then prevailing that a prudent person acting in a like capacity and familiar with these matters would use in the conduct of an enterprise of a like character and with like aims.
ARTICLE 4. Investigation and Penalties [25391. - 25392.]
At least once in each four-year period after the establishment of the retirement system the board shall cause to be made an actuarial valuation of the assets and liabilities of the retirement fund, and upon the basis of such investigation and valuation shall make such revision or change of the rates of contribution, the periods and conditions of service, and amounts of retirement allowances as may be necessary.
Except as herein provided, no member of the board or of the retirement board, nor any member of the retirement system or employee of the district, shall have any interest direct or indirect in the making of any investment or in the gains or profits accruing therefrom, and no such person, directly or indirectly, for himself or as an agent or partner of others, shall borrow any of its funds, nor shall any such person in any manner use the same except to make such current and necessary payments as are authorized by the retirement board, nor shall such a person become an endorser or surety as to, or in any manner an obligor for investments of the retirement fund.
CHAPTER 6. Powers and Functions of District [25701. - 25951.]
ARTICLE 1. Corporate Power [25701. - 25703.]
A district has perpetual succession and may adopt a seal and alter it at pleasure.
A district may sue and be sued, except as otherwise provided by law, in all actions and proceedings, in all courts and tribunals of competent jurisdiction.
A district may exercise the right of eminent domain to take any property necessary or convenient to the exercise of the powers granted in this division. The district, in exercising such power, shall in addition to the damage for the taking, injury, or destruction of property, also pay the cost of removal, reconstruction, or relocation of any structure, railways, mains, pipes, conduits, wires, cables or poles of any public utility which is required to be moved to a new location.
ARTICLE 2. Contracts [25721. - 25722.]
A district may make contracts and enter into stipulations of any nature whatsoever, either in connection with eminent domain proceedings or otherwise, including, without limiting the generality of the foregoing, contracts and stipulations to indemnify and save harmless, to employ labor, and to do all acts necessary and convenient for the full exercise of the powers granted in this division.
Neither the general manager nor any director of the district shall in any manner be interested, directly or indirectly, in any contract awarded or to be awarded by the board, or in the profits to be derived therefrom. Any violation of this provision is a misdemeanor, and conviction shall work a forfeiture of office. This section has no application to contracts awarded to corporations in which such officer owns less than 1 percent of the entire capital stock.
ARTICLE 4. Property [25771. - 25772.]
A district may take by grant, purchase, gift, devise, or lease, or condemn in proceedings under eminent domain, or otherwise acquire, and hold and enjoy, real and personal property of every kind within or without the district necessary to the full or convenient exercise of its powers. The board may lease, mortgage, sell, or otherwise dispose of any real or personal property within or without the district when in its judgment it is for the best interests of the district so to do.
Whenever the board by resolution determines that any record, map, book, or paper in the possession of the district or any officer or employee thereof is of no further value to the district, the board may authorize its sale, destruction, or other disposition.
ARTICLE 5. Transit Facilities and Service [25801. - 25816.]
A district may acquire, construct, own, operate, control or use rights of way, rail lines, bus lines, stations, platforms, switches, yards, terminals, and any and all other facilities necessary or convenient for transit service within or partly without the district, underground, upon, or above the ground and under, upon, or over public streets or other public ways or waterways, together with all physical structures necessary or convenient for the access of persons and vehicles thereto, and may acquire any interest in or rights to the joint use of any or all of the foregoing; provided, that installations in state freeways shall be subject to the approval of the State Department of Public Works and installations in other state highways shall be subject to Article 2, Chapter 3, Division 1 of the Streets and Highways Code.
A district may without limitation by any other provisions of this part requiring approval of indebtedness, accept contributions of money, rights-of-way, labor, materials, and any other property for the acquisition, construction, maintenance, and operation of transit facilities, and may without limitation by any other provisions of this part enter into any contracts and cooperate with and accept cooperation from the state, or any department, instrumentality, or agency thereof, or any public agency of the state in the acquisition, construction, maintenance, and operation of, and in financing the acquisition, construction, maintenance, and operation of, any such transit facilities.
A district shall not interfere with or exercise any control over any transit facilities now or hereafter owned and operated wholly or partly within the district by any city or public agency, unless by consent of such city or public agency and upon such terms as are mutually agreed upon between the board and such city or public agency.
A district may lease or contract for the use of its transit facilities, or any portion thereof, to any operator, and may provide for subleases by such operator upon such terms and conditions as it deems in the public interest. The word “operator” as used in this section means any city or public agency or any person, firm or private corporation.
A district may construct and operate or acquire and operate works and facilities in, under, upon, over, across, or along any street or public highway or any stream, bay or watercourse, or over any of the lands which are the property of the State, to the same extent that such rights and privileges appertaining thereto are granted to municipalities within the State. The district shall with respect to the operation of any rail facilities maintain the area of the street or public highway between such rails and for two feet on either side thereof and shall upon removal of such rails restore any such street or public highway to a like condition as the surrounding street or highway area, all in accordance with local ordinances. The district shall not use any street or public highway in a manner to unnecessarily impair its usefulness. The district shall upon acquiring by condemnation or otherwise the facilities of a private transit company assume any and all obligations of such private company to maintain, repair or replace any street, public highway or part thereof.
A district may enter into agreements for the joint use of any property and rights by the district and any city, public agency or public utility operating transit facilities; may enter into agreements with any city, public agency or public utility operating any transit facilities, either wholly or partially within, or without, the district, for the joint use of any property of the district or of such city, public agency or public utility, or the establishment of through routes, joint fares, transfer of passengers or pooling arrangements.
The rates and charges for service furnished pursuant to this part shall be fixed by the board and shall be reasonable.
The board of supervisors of a county or a city and county, or the city council of a municipality having territory located within the district may file a request for a hearing before the district board as to the reasonableness of any rates or charges fixed by the district and as to any proposal for fixing the location of facilities by the district. The request shall be in writing and shall state the subject matter on which a hearing is desired.
Upon the filing of a request for hearing as provided in Section 25808 the district board shall fix the time and place for hearing. The time fixed shall not be less than 15 days nor more than 60 days from the date such request is filed. Notice of such hearing shall be given to the county or city requesting such hearing and shall be published by the board.
At the time fixed for any hearing before the board any board of supervisors or city council eligible to file a request for hearing, not a party to the original request for hearing, may intervene and shall be entitled to be heard and to introduce evidence.
The district, petitioner or petitioners, and the intervenors shall have the right to call and examine witnesses; to introduce exhibits; to cross-examine opposing witnesses on any matter relevant to the issues even though that matter was not covered in direct examination; and to rebut evidence introduced by other parties.
Oral evidence shall be taken only on oath or affirmation. The hearing need not be conducted according to technical rules relating to evidence and witnesses. Any relevant evidence shall be admitted if it is the sort of evidence on which responsible persons are accustomed to rely in the conduct of serious business affairs, regardless of the existence of any common law or statutory rule which might make improper the admission of such evidence over objection in a civil action. Hearsay evidence may be used for the purpose of supplementing or explaining any direct evidence but shall not be sufficient in itself to support a finding unless it would be admissible over objection in a civil action.
The general counsel for the district shall be present at the hearing and shall advise the board on matters of law, and shall render other assistance that may be requested by the board.
A complete record of all proceedings and testimony before the board at such hearing shall be taken down by a reporter appointed by the board. In case an action is brought to review any decision of the board, a transcript of such testimony, together with all exhibits or copies thereof introduced, together with the written request for hearing and other proceedings in the cause shall constitute the record on review; provided, however, that the board and other parties may stipulate in writing that a specified portion of the evidence be certified to the court for judgment and in such case the portion of the evidence specified and the stipulation specifying such evidence shall be the record on review.
Within 30 days after submission of the case the board shall render its decision in writing together with written findings of fact. Copies of the findings and decision shall be sent forthwith to the petitioners and intervenors by registered mail, postage prepaid.
Within 40 days after the mailing of the decision to the petitioner, the petitioner may apply for a writ of mandate in the manner provided in the Code of Civil Procedure. The complete record of the proceedings, or such parts thereof as are designated by the petitioner, shall be prepared by the district and shall be delivered to the petitioner within 30 days after a request therefor, upon payment of the expense of preparation and certification thereof.
ARTICLE 6. Indebtedness [25841. - 25849.]
A district may borrow money and incur indebtedness, and may issue bonds or other evidences of indebtedness. No indebtedness shall be incurred exceeding the ordinary annual income and revenue of the district without the approval of a two-thirds vote of the voters voting on the proposition to incur such indebtedness; except that a further vote of the voters is not required for any indebtedness incurred within the purposes and not exceeding the available amount of any previously authorized bond issue, and as to such indebtedness the proceeds of any of the bonds unexpended in the treasury of the district, or the par value of any of the bonds which are unsold shall be deemed a part of the ordinary annual income and revenue of the district.
A district may borrow money for the purpose of defraying the expenses of a district lawfully incurred after the commencement of the fiscal year, but prior to the time moneys from the tax levy for the fiscal year are received by a district, in a sum which shall not exceed five cents ($0.05) on each one hundred dollars ($100) of assessed valuation of taxable property in a district at the time the moneys are borrowed, and may evidence such borrowing by notes bearing interest at a rate not to exceed six (6) percent per annum. The notes shall be payable from the tax levy from the then current fiscal year, which levy shall contain a sum sufficient to provide for the payment of the notes and the interest thereon. The form of said notes and the proceedings relating to their issuance and sale, will be governed by the applicable provisions contained in Article 7 (commencing at Section 53820) of Chapter 4 of Part 1 of Division 2 of Title 5 of the Government Code. The maturity of said notes shall not exceed two (2) years.
No district shall incur an indebtedness for public works which in the aggregate exceeds 20 percent of the assessed value of all the real and personal property within the district.
Indebtedness which has been incurred for the acquisition, construction, and operation of transit facilities, where the revenue from the transit facilities for three years or more next preceding has been sufficient to pay the interest and principal due on any bonds issued for its construction or acquisition, in addition to the cost of operation and maintenance, shall not be counted and included in ascertaining the limit of indebtedness.
A district may accept, without limitation by any other provisions of this division requiring approval of indebtedness, contributions or loans from the United States, this State, or any department, instrumentality, or agency of either thereof, for the purpose of financing the acquisition, construction, maintenance, and operation of transit facilities, and may enter into contracts and cooperate with, and accept cooperation from, the United States, this State, or any department, instrumentality, or agency of either thereof, in the acquisition, construction, maintenance, and operation, and in financing the acquisition, construction, maintenance, and operation, of any such transit facilities in accordance with any legislation which Congress or the Legislature of the State of California may have heretofore adopted or may hereafter adopt, under which aid, assistance, and cooperation may be furnished by the United States or this State in the acquisition, construction, maintenance, and operation or in financing the acquisition, construction, maintenance, and operation of any such transit facilities. A district may do any and all things necessary in order to avail itself of such aid, assistance, and cooperation under any federal or state legislation now or hereafter enacted. Any evidence of indebtedness issued under this section shall constitute a negotiable instrument.
The district may purchase equipment such as cars, trolley buses and motorbuses, and rolling equipment, and may execute agreements, leases and equipment trust certificates in the forms customarily used by private corporations engaged in the transit business appropriate to effect the purchase and leasing of rolling equipment and may dispose of the equipment trust certificates upon the terms and conditions as the board may deem appropriate. All money required to be paid by the district pursuant to the agreements, leases and equipment trust certificates provided for in this section shall be payable solely from the revenue or income to be derived from the transit facilities and from grants and loans as provided in Section 25844. Payment for equipment, or the rental of equipment, may be made in installments, and the deferred installments may be evidenced by equipment trust certificates payable solely from revenue or income as provided in this section, and title to the equipment shall not vest in the district until the equipment trust certificates are paid.
The agreement to purchase or lease may direct the vendor or lessor to sell and assign or lease the rolling equipment to a bank or trust company, duly authorized to transact business in the State of California, as trustee, for the benefit and security of the equipment trust certificates and may direct the trustee to deliver the rolling equipment to one or more designated officers of the district and may authorize the district to simultaneously execute and deliver an installment purchase agreement or a lease of the equipment to the district.
The agreements and leases shall be duly acknowledged before a person authorized by law to take acknowledgments of deeds and in the form required for acknowledgment of deeds. The agreements, leases, and equipment trust certificates shall be authorized by resolution of the district and shall contain such covenants, conditions and provisions as may be deemed necessary or appropriate to insure the payment of the equipment trust certificates from the revenue or income to be derived from the transit system.
The covenants, conditions and provisions of the agreements, leases, and equipment trust certificates shall not conflict with any of the provisions of any trust agreement securing the payment of bonds, notes or certificates of the district.
An executed copy of each agreement or lease shall be filed in the Office of the Secretary of State, who will be entitled to receive one dollar ($1) for each copy filed with him and which filing shall constitute notice to any subsequent judgment creditor or any subsequent purchaser. Each vehicle so purchased or leased shall have the name of the owner or lessor plainly marked on both sides thereof, followed by the appropriate words, “owner and lessor” or “owner and vendor,” as the case may be.
ARTICLE 7. Investments [25871. - 25874.]
A district may invest any surplus money in its treasury, including money in any sinking fund, in any of the following:
Its own bonds.
Treasury notes, certificates of indebtedness, bills, bonds of the United States, or any other evidence of indebtedness secured by the full faith and credit of the United States.
Obligations issued pursuant to the Federal Home Loan Bank Act or the National Housing Act.
Treasury notes or bonds of this state, or of any public corporation, municipal corporation, public district, or political subdivision within this state which are legal as security for the deposit of public funds.
In any investment or deposit in which a city, county, or local public agency may place its funds pursuant to law.
Such investment may be made by direct purchase of any issue of such bonds, treasury notes, or obligations, or part thereof, at the original sale or by the subsequent purchase of the bonds, treasury notes, or obligations.
Any bonds, treasury notes, or obligations purchased and held as investments by the district may from time to time be sold and the proceeds reinvested in bonds, treasury notes, or obligations as provided in this article.
Sales of any bonds, treasury notes, or obligations purchased and held by the district shall from time to time be made in season so that the proceeds may be applied to the purposes for which the money with which the bonds, treasury notes, or obligations were originally purchased was placed in the treasury of the district.
ARTICLE 8. Taxation [25891. - 25904.]
A district may levy, and collect or cause to be collected, taxes for any lawful purpose.
If, in the opinion of the board, the revenues will not be sufficient for any and all lawful purposes the board shall levy a tax for such purpose or purposes and fix the amount of money necessary to be raised therefor by taxation.
The district board may impose a special tax pursuant to Article 3.5 (commencing with Section 50075) of Chapter 1 of Part 1 of Division 1 of Title 5 of the Government Code. The special taxes shall be applied uniformly to all taxpayers or all real property within the district, or any portion of the district that is coterminous with the boundaries of a city or the boundaries of contiguous cities, including any properties added to the district, except that unimproved property may be taxed at a lower rate than improved property.
The proceeds of the special taxes shall be used to provide, within the area taxed, for the operation, maintenance, or acquisition of any public improvement or utility for transportation purposes.
The board shall, at the time of fixing the general tax levy and in the manner provided for the general tax levy, levy and collect annually until the district’s bonds are paid, or until there is a sum in the treasury of the district set apart for that purpose to meet all sums coming due for principal and interest on the bonds as they become due a tax sufficient to pay the annual interest on the bonds and such part of the principal thereof as becomes due before the proceeds of a tax levied at the next general tax levy will be available. If the maturity of the indebtedness created by the issue of bonds begins more than one year after the date of the issuance thereof, the tax shall be levied and collected annually at the time and in the manner aforesaid, sufficient to pay the interest on the indebtedness as it falls due and to constitute a sinking fund for the payment of the principal on or before maturity.
The taxes required to be levied and collected on account of interest, principal, and sinking fund of district bonds shall be in addition to all other taxes levied for district purposes, and shall be collected at the time and in the same manner as other district taxes are collected, and be used for no other purpose than the payment of the bonds and accruing interest.
The board may provide for the assessment, levy, and collection of taxes by the district, including the sale of property to the district for delinquent taxes, with penalties, interest, and cost.
The board may elect to avail itself of the assessments made by the assessors of the counties in which the district is situated, and of the assessments made by the State Board of Equalization for those counties, and may take such assessments as the basis for district taxation and have its taxes collected by the county officials if the board declares its election so to do by resolution or ordinance and files a certified copy of the resolution or ordinance on or before the first day of August with the auditors of the counties in which the district is situated. Thereafter, each year and until otherwise provided by the board, all assessments shall be made for the district by the State Board of Equalization and the county assessors, and all taxes shall be collected for the district by the tax collectors, of the counties in which the district is situated.
In such case the county auditor shall, on or before the third Monday in August of each year, transmit to the board a statement in writing showing the total value of all property within the district, ascertained from the assessments referred to in Section 25896 as equalized.
In case the board elects to avail itself of the assessments referred to in Section 25896 it shall, on or before the first weekday in September, or if such weekday falls upon a holiday then on the first business day thereafter, fix the rate of taxes, designating the number of cents upon each hundred dollars, using as a basis the value of property transmitted to the board by the county auditors, which rate of taxation shall be sufficient to raise the amount previously fixed by the board. These acts by the board shall constitute a valid assessment of the property and a valid levy of the taxes so fixed.
The board shall immediately after fixing the rate of taxes as above provided transmit to the county auditors of the counties in which the district is situated a statement of the rate of taxes fixed by the board.
The district’s taxes so levied shall be collected at the same time and in the same manner as county taxes. When collected the net amount, ascertained as provided in this article, shall be paid to the treasurer of the district, under the general requirements and penalties provided by law for the settlement of other taxes. The district may adopt the alternative procedure of tax collection and apportionment established by Chapter 3, Part 8, Division 1 of the Revenue and Taxation Code and any amendments thereof; provided, however, that the district may thereafter abandon said alternative procedure at the end of any fiscal year of the district.
Whenever any real property situate in any district which has availed itself of the provisions of Section 25896 has been sold for taxes and has been redeemed, the money paid for redemption shall be apportioned and paid to the district by the county treasurers receiving it in the proportion which the tax due to the district bears to the total tax for which the property was sold.
The compensation to be charged by and paid to any county for the performance of services under this article shall be fixed by agreement between the board of supervisors of the county and the board. The compensation shall in no event exceed one-half of 1 percent of all money collected for the district. The compensation collected by the county shall be placed to the credit of the county salary fund.
All taxes levied under this part are a lien on the property on which they are levied. Unless the board has by ordinance otherwise provided, the enforcement of the collection of such taxes shall be in the same manner and by the same means provided by law for the enforcement of liens for county taxes, all the provisions of law relating to the enforcement of the latter being made a part of this part, so far as applicable.
Whenever one or more special transit service districts are created and established pursuant to Chapter 10.5 (commencing at Section 27401), taxes in excess of one cent ($0.01) per one hundred dollars ($100) of assessed valuation shall not thereafter be levied against any property not within the boundaries of a special transit service district, excepting, however, taxes sufficient to pay the principal or interest or both on any bonded indebtedness theretofore or thereafter incurred by a district as a whole. The creation of a special transit service district does not invalidate, in any manner, any taxes or assessments previously levied or assessed against any property of the district, either within or without the boundaries of a special transit service district.
ARTICLE 9. Claims [25951. - 25951.]
CHAPTER 7. Bonds [26201. - 26352.]
ARTICLE 1. Issuance [26201. - 26212.]
A district may from time to time incur a bonded indebtedness as provided in this chapter to pay the cost of acquiring, constructing, or completing the whole or any portion of any transit facilities, or for acquiring any works, lands, structures, rights, equipment, or other property necessary or convenient to carry out the objects, purposes, or powers of the district.
Whenever the board by resolution passed by vote of two-thirds of all its members determines that the public interest or necessity demands the acquisition, construction, or completion by the district of any transit facilities or any works, lands, structures, rights, equipment, or other property necessary or convenient to carry out the objects, purposes, or powers of the district, the cost of which will be too great to be paid out of the ordinary annual income and revenue of the district, it may at any subsequent meeting of the board provide by ordinance for the submission of the proposition of incurring a bonded indebtedness for the purpose set forth in the resolution to the voters of the district at a special bond election held for that purpose.
In lieu of a resolution passed by the board, proceedings for the issuance of bonds for the purposes provided in this chapter may be initiated by petition of the voters of the district.
Whenever any petition signed by voters within the district equal in number to at least 15 percent of the total vote cast is presented to the board asking for the acquisition, construction, or completion of the whole or any portion of any transit facilities or for acquiring any works, lands, structures, rights, equipment, or other property necessary or convenient to carry out the objects, purposes, or powers of the district, and also asking that a bonded indebtedness be incurred to pay for the cost thereof, the secretary of the district shall immediately examine and verify the signatures of the petition and certify the result of the examination to the board.
If the required number of signatures is found to be genuine, the secretary shall transmit to the board an authentic copy of the petition without the signatures.
Upon receiving a petition with the certificate of the secretary stating that it contains the required number of signatures, the board shall formulate for submission to the voters of the district at a special bond election called for that purpose the proposition of incurring a bonded indebtedness for the purposes set forth in the petition. In its discretion the board may defer the calling of the election until the next general election to be held in the district in order to consolidate them.
The ordinance calling a special bond election shall fix the date on which the election will be held, and the manner of holding the election and of voting for or against incurring the indebtedness. It shall also recite the objects and purposes for which the indebtedness is proposed to be incurred, the estimated cost of the transit facilities, works, lands, structures, rights, equipment, or other property proposed to be acquired, constructed, or completed, the amount of the principal of the indebtedness to be incurred therefor, and the maximum rate of interest to be paid on the indebtedness, which shall not exceed 6 percent per annum, payable semiannually or annually the first year and thereafter semiannually.
Propositions for incurring indebtedness for more than one object or purpose may be submitted at the same election.
Any special bond election may be held separately, or may be consolidated with any other election authorized by law at which the voters of the district may vote. If a special bond election is consolidated with any other election, the provisions of this chapter setting forth the procedure for the calling and holding of the special bond election shall be complied with, except that the ordinance calling the election need not set forth the election precincts, polling places, and officers of election, but may provide that the precincts, polling places, and officers of election shall be the same as those set forth in the ordinance, notice, or other proceedings calling the election with which the special bond election is consolidated, and shall refer to the ordinance, notice, or other proceedings by number and title, or by other definite description.
The ordinance shall be published, and no other notice of election need be given.
The board shall comply with Article 3 (commencing with Section 9160) of Chapter 2 of Division 9 of the Elections Code, the provisions of which are applicable to any bond election held pursuant to this article. Wherever the words “county clerk” or “county elections official” appear in the Elections Code, the words “secretary of the board” shall be substituted, for the purposes of this article, and wherever the words “board of supervisors” appear in the Elections Code, the words “board of directors” shall be substituted, and wherever the words “district attorney or county counsel” appear in the Elections Code, the words “general counsel for the district” shall be substituted.
The votes of two-thirds of all the voters voting on the proposition at the election are required to authorize the issuance of bonds under this chapter.
If the proposition submitted at a special bond election fails to receive the requisite number of votes, the board shall not within six months after the election hold another special election for the submission of a proposition of incurring a bonded indebtedness substantially the same as the proposition voted upon at the prior election unless a petition signed by voters within the district equal in number to at least 15 percent of the total vote cast is filed with the board, requesting that the proposition, or a proposition substantially the same, be submitted at an election to be called for that purpose.
ARTICLE 2. Form and Content [26241. - 26244.]
Bonds authorized by this chapter shall mature serially in amounts to be fixed by the board; except that payment shall begin not later than 10 years from the date thereof and shall be completed in not more than 50 years from that date.
The board may divide any issue of bonds authorized pursuant to this chapter into two or more series, and may fix different dates of issuance and different maturity dates for the bonds of each series. The bonds of each series shall mature serially in amounts to be fixed by the board, and the board shall fix a date not more than 10 years from the date of issuance of each series for the earliest maturity of such series, and shall fix a date not more than 50 years from the date of issuance of each series for the final maturity of such series.
Pending the actual issuance or delivery of bonds, a district may issue temporary or interim bonds, certificates, or receipts, of any denomination whatsoever, with or without coupon, and in such form as may be prescribed by the board, to be exchanged for definitive bonds when ready for delivery.
The bonds shall be issued in such denominations as the board determines, except that no bonds shall be of a denomination less than one hundred dollars ($100), nor of a greater denomination than one thousand dollars ($1,000) or any multiple thereof, and shall be payable on the day and at the place or places fixed in the bonds, and with interest at the rate specified therein, payable semiannually.
The board may at any time prior to the issuance and sale of any bonds provide for the call and redemption of any or all of the bonds on any interest payment date prior to their fixed maturity at not exceeding the par value and accrued interest plus a premium of not exceeding 5 percent upon the principal amount of the bonds, in which event the call price fixed by the board shall be set forth on the face of the bond. Notice of such redemption shall be published. If there is no newspaper of general circulation printed and published within the district, then the publication shall be made in a newspaper of general circulation printed and published within the county in which the district or any part thereof is situated. The first publication shall be at least 30 days prior to the date fixed for the redemption. After the date fixed for such redemption interest on the bonds thereafter shall cease.
The bonds shall be signed by the president of the board or by such officer of the district as the board shall by resolution authorize and designate for that purpose. They shall also be signed by the treasurer, and be countersigned by the secretary. The coupons of the bonds shall be numbered consecutively and be signed by the treasurer. All signatures and countersignatures, except one of said signatures or countersignatures on the bonds, may be printed, lithographed, or engraved. If any officer whose signature or countersignature appears on the bonds or coupons ceases to be such officer before the delivery of the bonds to the purchaser, the signature or countersignature is nevertheless valid and sufficient for all purposes as if he had remained in office until the delivery of the bonds.
ARTICLE 3. Issue and Sale [26261. - 26263.]
The bonds may be issued and sold for not less than their par value, but otherwise as the board determines. Before selling any bonds, or any part thereof, the board shall give notice inviting sealed bids in such manner as the board may prescribe. If satisfactory bids are received, the bonds offered for sale shall be awarded to the highest responsible bidder. If no bids are received, or if the board determines that the bids received are not satisfactory as to price or responsibility of the bidders, the board may reject all bids received, if any, and either again give notice inviting bids or sell the bonds at private sale.
All premiums and accrued interest received on the sale of bonds shall be placed in the fund to be used for the payment of principal of and interest on the bonds. The remainder of the proceeds of the bonds shall be placed in the district treasury to the credit of the proper fund, and shall be used exclusively for the objects or purposes for which the bonds were voted; provided that when said objects and purposes have been accomplished any moneys remaining shall be transferred to the fund to be used for the payment of principal of and interest on the bonds, and that when all principal of and interest on the bonds shall have been paid, any balance of money then remaining shall be transferred to the general fund of the district.
In lieu of the immediate levy of a tax to pay the interest or any part thereof on any bonded indebtedness incurred in accordance with this division, the board may in the estimate of the amount of money necessary to be raised by the bonds include a sum sufficient to pay interest on all of the bonds or part thereof during the period of acquisition, construction, or completion, but for no period in excess of five years.
ARTICLE 4. Refunding [26281. - 26287.]
Whenever the board by resolution passed by a vote of two-thirds of all its members determines that the refunding of the whole or any portion of the bonded indebtedness will be of advantage to the district the board may refund the bonded indebtedness or any portion thereof and issue refunding bonds of the district therefor.
The issuance of refunding bonds shall not be construed as the incurring or increase of an indebtedness within the meaning of this division, and the approval of the voters is not required for the issuance of refunding bonds. The board may provide for the call and redemption of any or all of the bonds on any interest payment date prior to their fixed maturity in the ordinance authorizing the issuance of the refunding bonds.
Except as otherwise provided, the provisions of this chapter shall substantially govern as to all matters pertaining to the issuance of refunding bonds, including and without limiting the generality of the foregoing, the form, execution, issuance, maturity, redemption, refunding, validation, the payment of interest from bond funds, and the status of the bonds as investments.
Refunding bonds shall bear interest at a rate not exceeding the interest rate on the refunded bonds, but payment of the refunding bonds shall begin not later than one year from the date thereof and be completed in not more than 40 years from that date.
The proceeds of the sale of refunding bonds shall be applied only to the purchase, or retirement at not more than par and accrued interest, or the call price, of the bonded indebtedness for which the refunding bonds were issued.
In lieu of selling refunding bonds and using the proceeds to purchase or retire the bonds to be refunded, the board may exchange refunding bonds at not less than par and accrued interest for the bonds so refunded.
Whenever outstanding bonds are refunded they shall be surrendered to the treasurer of the district, who shall cancel them by endorsing on their face the manner in which the refunding was effected (whether by exchange or purchase, and the amount for which so purchased, if any) and by perforating through each bond and each coupon attached thereto the word “canceled” together with the date of cancellation.
ARTICLE 5. Status as Investments [26311. - 26312.]
All bonds including refunding bonds issued by a district are legal investments for all trust funds and for the funds of all insurance companies, banks, both commercial and savings, and trust companies, and for the State School Fund and for all sinking funds under the control of the State Treasurer. Whenever any money or funds may by law be invested in or loaned upon the security of bonds of cities, cities and counties, counties, or school districts, in the State, such money or funds may be invested in or loaned upon the security of the bonds of a district; and whenever bonds of cities, cities and counties, counties, or school districts by law may be used as security for the faithful performance or execution of any court or private trust or of any other act, bonds of the district may be so used.
All bonds of the district, to the same extent as bonds of any other municipality, are legal for use by any state or national bank or banks in the State as security for the deposit of funds of the State or of any county, city and county, city, municipality, or other public or municipal corporation within the State.
ARTICLE 6. Validating Proceedings [26341. - 26341.]
An action to determine the validity of bonds may be brought pursuant to Chapter 9 (commencing with Section 860) of Title 10 of Part 2 of the Code of Civil Procedure.
ARTICLE 7. Revenue Bonds [26351. - 26352.]
As an alternative procedure for the raising of funds, a district created pursuant to this part is authorized to issue bonds, payable from revenues of any facility or enterprise to be acquired or constructed by a district, in the manner provided by the Revenue Bond Law of 1941 (Chapter 6 (commencing at Section 54300) of Part 1 of Division 2 of Title 5 of the Government Code), all of the provisions of which are applicable to a district created pursuant to this part.
A district created pursuant to this part is a local agency within the meaning of the Revenue Bond Law of 1941 (Chapter 6 (commencing at Section 54300) of Part 1 of Division 2 of Title 5 of the Government Code). The term “enterprise” as used in the Revenue Bond Law of 1941 shall, for all purposes of this part, include transit facilities and any and all parts thereof and all additions, extensions and improvements thereto and all other facilities authorized to be acquired, constructed or completed by a district under this part. A district may issue revenue bonds under the Revenue Bond Law of 1941, for any one or more facilities or enterprises authorized to be acquired, constructed, or completed by a district or, in the alternative, may issue revenue bonds under the Revenue Bond Law of 1941, for the acquisition, construction and completion of any one of such facilities. Nothing in this article shall prevent a district from availing itself of, or making use of, any procedure provided in this part for the issuance of bonds of any type or character for any of the facilities or works authorized hereunder, and all proceedings may be carried on simultaneously or, in the alternative, as the directors may determine.
CHAPTER 8. Annexation of Cities [26401. - 26551.]
ARTICLE 1. Annexation Agreement [26401. - 26406.]
Any city not included within the boundaries of a district may be annexed thereto in the manner provided in this chapter.
The legislative body of the city proposed to be annexed shall agree in writing with the board upon the terms and conditions of annexation, which agreement (among other things) may provide for the levy and collection of special taxes within the city in addition to the taxes elsewhere in this division provided for, the fixing of rates, rentals, and charges differing from those fixed or existing elsewhere within the district, the incurring or assumption of indebtedness, or the making of a payment or payments, or the transfer of property, real and personal, and other assets to the district by the city.
The annexation agreement may also provide that the city’s annexation to the district shall constitute annexation to any existing special transit service district. Approval of the annexation by the voters, pursuant to this chapter, if the annexation agreement includes provision for inclusion in a special transit service district, shall constitute full compliance with the provisions of Article 6 (commencing at Section 27461) of Chapter 10.5.
As an alternative to commencement of annexation proceedings by action of the legislative body of a city, a petition signed by voters within the city proposed to be annexed, equal in number to at least ten (10) percent of the total vote cast, and asking that proceedings be taken for its annexation, may be addressed to the board and filed with the secretary of the district.
The petition may include one or more separate documents, but each document shall contain the affidavit of the party who circulated it, certifying that each name signed thereto is the true signature of the person whose name it purports to be. The secretary of the district shall compare the signatures on the petition with the affidavits of registration on file with the county elections official and if he or she finds that the petition has been signed by the required number of voters he or she shall attach his or her signature thereto and present the petition to the board.
If the board determines that the annexation of the city, whose voters have petitioned pursuant to Section 26404, would facilitate the acquisition or operation of any transit facilities for the district or be of advantage to the district, then the board shall also determine the terms and conditions upon which the annexation should be made. The terms and conditions of annexation shall be embodied in an annexation agreement. The annexation agreement may provide (among other things) for any or all of the items set forth in Sections 26402 and 26403.
ARTICLE 2. Approval by District [26421. - 26427.]
The agreement shall become effective and be binding upon the district and the city when approved in the manner set forth in this chapter.
The board shall by ordinance setting forth the agreement at length declare its intention of causing it to be executed by the district.
The ordinance, together with a notice fixing the time and place for hearing thereon, shall be published in the district pursuant to Section 6061 of the Government Code. The time fixed for the hearing shall be not less than 30 nor more than 60 days from the date of the publication of the ordinance.
At the hearing any person interested may file with the board written objections to the execution of the agreement.
Upon the hearing the board shall determine whether or not the agreement will be carried into execution and shall hear and determine all objections thereto. Failure of any person interested in the district or in the matter of the proposed execution of the agreement to show cause in writing pursuant to Section 25423 constitutes an assent on his part to a change in the boundaries of the district and to the execution of the agreement.
Any hearing on the agreement may be adjourned from time to time by the board without further notice other than an order to be entered upon the minutes of the meeting fixing the time and place of adjournment.
If no protests are filed or if the protests filed are overruled and denied the board shall thereupon by resolution finally approve the agreement and authorize its execution, which shall become effective when executed by the city, duly authorized in the manner provided in this chapter.
When executed by the district the agreement shall be dated and an executed copy filed with the secretary of the district. An executed copy shall also be filed with the clerk of the city to be annexed.
ARTICLE 3. Approval by City [26451. - 26456.]
At any time after the board has finally approved the agreement of annexation the legislative body of the city to be annexed shall cause an election to be held in the city to determine whether the city will be annexed to the district upon the terms and conditions stated in the agreement.
Notice of election shall be published as provided in Section 24533 and shall either state that a copy of the annexation agreement is on file in the office of the secretary or clerk of the city proposed to be annexed, and open to the inspection of all persons interested, or set forth the terms and conditions of the agreement of annexation at length, in the discretion of the legislative body calling the election.
The ballots for the election shall contain substantially the instructions required to be printed on ballots for use at general state and county elections and in addition shall set forth the proposition of annexation substantially as follows:
If upon a canvass of the election it is found that a majority of all votes cast on the proposition at the election were cast in favor of the annexation, the proposition and all of the terms and conditions of the agreement of annexation shall be deemed carried and approved by the voters; except that if the terms and conditions of the agreement of annexation provide for the assumption of any indebtedness of the district by any city proposed to be annexed, the proposition of annexation shall not be deemed carried unless approved by the vote of two-thirds of all the voters voting on the proposition at the election.
If the proposition fails to carry, the result shall be entered upon the minutes of the governing body of the city.
If the proposition receives the vote of the requisite majority of voters the governing body of the city shall enter in its minutes an order declaring the result of the election and shall thereupon cause the agreement of annexation to be executed by its duly authorized officers.
ARTICLE 4. Establishment of Annexation [26486. - 26486.]
Upon receipt by the district of a copy of the agreement of annexation properly executed by the district and the city proposed to be annexed the board shall pass a resolution declaring the city annexed to the district, and shall cause a certified copy of the resolution to be filed with the Secretary of State. From and after the date of filing of the resolution with the Secretary of State the annexation of the city to the district is complete.
ARTICLE 5. Annexation of Territory to Cities [26511. - 26512.]
Upon the completion of the annexation of any territory in accordance with law to any city included or partially included in the district, the city clerk shall file with the secretary of the district a certified copy of the ordinance, resolution or other document completing said annexation, containing a description of the territory so annexed. Unless the district within 90 days after such filing shall file with the city clerk the district’s written objections to the annexation to the district of said territory or portion thereof, such territory, or portion thereof, not objected to by the district shall, upon the termination of such period be deemed incorporated into and annexed to the district, and thereafter is subject to taxation, along with the entire territory of the district in accordance with the assessable valuation of the property thereof, for general district purposes, and for the payment of any indebtedness theretofore or thereafter incurred by the district.
If the district shall file its objections in the manner aforesaid to the annexation to the district of such territory or portion thereof, the territory, or portion thereof, shall not be annexed to the district except in the manner provided in Articles 1 (commencing with Section 26401), 2 (commencing with Section 26421), 3 (commencing with Section 26451) and 4 ( commencing with Section 26486) of this chapter. The district may withdraw such objections by filing with the city clerk a certified copy of a resolution of the board stating that such objections are withdrawn. Thereupon said territory, or portion thereof, shall be deemed incorporated into and annexed to the district as provided in Section 26511.
ARTICLE 6. Effect of Annexation [26531. - 26532.]
From and after the date of annexation the board shall levy upon all of the property in the city annexed such taxes, tolls, or charges as are necessary to provide funds for the payment of the indebtedness assumed by the city or otherwise necessary to comply with the terms and conditions of the annexation agreement, all in addition to the general district taxes authorized elsewhere in this division to be levied and collected.
No annexation of a city to a district shall operate to dissolve or terminate the legal existence of the city annexed.
ARTICLE 7. Contest of Annexation [26551. - 26551.]
The validity of any proceedings for the annexation of any city to any district shall not be contested in any action unless the action is brought within three months after the completion of the proceedings.
CHAPTER 9. Annexation of Unincorporated Territory [26651. - 27111.]
ARTICLE 1. Annexation Agreement [26651. - 26658.]
Unincorporated territory may be annexed to a district in the manner provided in this chapter.
Unincorporated territory not contiguous to a district may not be annexed if the district does not possess facilities for supplying transit service to that territory.
A petition signed by voters within the territory proposed to be annexed equal in number to at least 10 percent of the total vote cast, describing the territory and asking that proceedings be taken for its annexation, shall be addressed to the board and filed with the secretary of the district.
The secretary shall compare the signatures on the petition with the affidavits of registration on file with the county elections official and if he or she finds that the petition has been signed by the required number of voters he or she shall attach his or her signature thereto and present the petition to the board.
If the board determines that the annexation of the territory would facilitate the acquisition or operation of any transit facilities for the district, or be of advantage to the district, then the board shall also determine the terms and conditions upon which the annexation should be made.
Provisions may be made (among other things) for payment of taxes within the territory to be annexed in addition to the taxes elsewhere in this part provided for, the fixing of rates, rentals, and charges differing from those fixed or existing elsewhere within the district, the incurring or assumption of indebtedness, or the making of a payment or payments, or the transfer of property, real and personal, and other assets to the district by the territory proposed to be annexed. The boundaries of the territory proposed to be annexed need not be coterminous with any election precincts. The terms and conditions shall become effective and be binding upon the district and the territory to be annexed when approved in the manner set forth in this chapter.
The annexation agreement may also provide that the unincorporated territory’s annexation to the district shall constitute annexation to any existing special transit service district. Approval of the annexation by the voters, pursuant to this chapter, if the agreement includes provision for inclusion in a special transit service district, shall constitute full compliance with the provisions of Article 6 (commencing at Section 27461) of Chapter 10.5.
As an alternative to commencement of annexation proceedings by a petition by the voters within any unincorporated territory, proposed to be annexed, the legislative body of an unincorporated territory may agree in writing upon the terms and conditions of annexation, which agreement may contain (among other things) provisions as set forth in Sections 26656 and 26657.
ARTICLE 2. Approval by District [26681. - 26687.]
The board shall by ordinance setting forth the terms and conditions at length declare its intention of causing the agreement to be approved by the district.
The ordinance together with a notice fixing the time and place for hearing thereon shall be published in the district pursuant to Section 6061 of the Government Code. A copy of the ordinance shall be filed with the secretary of the district. The time fixed for hearing shall not be less than 30 nor more than 60 days from the date of the publication of the ordinance.
At the hearing any person interested may file with the board written objections to the approval of the terms and conditions.
Upon the hearing the board shall determine whether or not the terms and conditions will be approved and shall hear and determine all objections thereto. Failure of any person interested in the district or in the matter of the proposed annexation on the terms and conditions set forth in the ordinance to show cause in writing pursuant to Section 26683 constitutes an assent on his part to a change in the boundaries of the district upon the terms and conditions set forth.
Any hearing on the agreement may be adjourned from time to time by the board, not exceeding 30 days in all, without further notice other than an order entered upon the minutes of the meeting fixing the time and place of adjournment.
If no protests are filed or the protests filed are overruled and denied by the board the board shall thereupon by resolution finally approve the terms and conditions and proceed with the annexation in the manner provided in this chapter.
If protests against the proposed annexation are sustained, all proceedings shall be dismissed and no proceedings shall be undertaken again concerning the territory or any part thereof until after the expiration of one year.
ARTICLE 3. Approval by Unincorporated Territory [27011. - 27016.]
The board shall cause an election to be held in the territory proposed to be annexed on the next established election date not less than 74 days after it has finally approved the terms and conditions of annexation to determine whether the territory shall be annexed to the district upon the terms and conditions stated in the ordinance.
Notice of election shall be published and shall either state that a copy of the ordinance containing the terms and conditions of annexation at length is on file in the office of the secretary of the district, and open to the inspection of all persons interested, or itself set forth the terms and conditions of annexation at length, in the discretion of the board.
The ballots for the election shall contain substantially the instructions required to be printed on ballots for use at general state and county elections and in addition shall set forth the proposition of annexation substantially as follows:
If upon a canvass of the election it is found that a majority of all votes cast on the proposition at the election were cast in favor of the annexation, the proposition and all of the terms and conditions set forth in the ordinance shall be deemed carried and approved by the voters.
If the proposition fails to carry, the result shall be entered upon the minutes of the board.
If the proposition is defeated by the voters, no annexation proceeding shall be commenced involving the territory or any part thereof until after the expiration of one year.
ARTICLE 4. Establishment of Annexation [27041. - 27041.]
In the event the proposition receives the vote of the requisite majority of voters the board shall pass a resolution declaring the territory annexed to the district, and shall cause a certified copy of the resolution to be filed with the Secretary of State, from and after the date of which filing with the Secretary of State the annexation of the territory to the district is complete.
ARTICLE 5. Annexation Without Election [27061. - 27063.]
Unincorporated territory may be annexed to a district without an election in the manner provided in this article.
A petition describing the territory proposed to be annexed and requesting that proceedings be taken for its annexation shall be signed by all of the owners of the real property described therein, verified by the affidavit of one of the petitioners, addressed to the board, and filed with the secretary of the district. If a portion of the territory consists of public highways, streets, roads or paths, it shall not be necessary to secure the signatures to the petition of the owners only of the real property occupied by such public highways, streets, roads or paths.
Proceedings shall thereafter be taken and a hearing held in substantial compliance with the provisions of this chapter relating to the annexation of unincorporated territory except that no election shall be held within the territory proposed to be annexed and the territory shall be deemed annexed to the district upon the passage of a resolution of the board declaring the territory annexed and the filing of a certified copy thereof with the Secretary of State.
ARTICLE 6. Effect of Annexation [27091. - 27091.]
From and after the date of annexation the board shall levy upon all of the property in the territory annexed any taxes, tolls, or charges which are necessary to provide funds for the payment of the indebtedness assumed by the territory or otherwise necessary to comply with the terms and conditions of the annexation, all in addition to the general district taxes authorized elsewhere in this division to be levied and collected.
ARTICLE 7. Contest of Annexation [27111. - 27111.]
The validity of any proceedings for the annexation of any unincorporated territory to any district shall not be contested in any action unless the action is brought within three months after the completion of the proceedings.
CHAPTER 10. Exclusion of Territory [27251. - 27302.]
ARTICLE 1. Exclusion of Unincorporated Territory [27251. - 27259.]
Any territory contained within a district not being served by any transit facilities of the district and not included within the boundaries of any incorporated city and not benefited in any manner by the district or by its continued inclusion therein may be excluded therefrom by order of the board upon the verified petition of the owners in fee of lands whose assessed value with improvements is in excess of one-half of the assessed value of all the lands with improvements held in private ownership in the territory sought to be excluded.
The petition shall describe the territory sought to be excluded and shall set forth that the territory is not benefited in any manner by the district or by its continued inclusion therein, and shall pray that the territory be excluded from the district.
The petition shall be filed with the secretary of the district and shall be accompanied by a deposit with the secretary of the sum of one hundred dollars ($100) to meet the expenses of advertising and other costs incident to the proceedings for the exclusion of the territory, including the cost of recording a certified copy of the order provided for in this chapter. Any unconsumed balance of the deposit shall be returned to the petitioners.
Upon the filing of the petition the secretary shall cause it to be set for hearing at a regular or adjourned regular meeting of the board and shall cause a notice of the filing thereof to be published. The notice shall also state the date of the filing of the petition and that it will come on for hearing before the board and shall state the time and place of the hearing. The time fixed for hearing shall not be less than 30 days from the date of the first publication of the notice. The property to be excluded may or may not be specifically described in the notice, but if not described the notice shall refer to the petition on file with the secretary for a particular description of the property sought to be excluded.
Any landowner or taxpayer within the district may appear at the hearing either in behalf of or in opposition to the granting of the petition.
The petition shall come on for hearing before the board at the time and place specified in the notice of hearing.
If upon the hearing the board determines that it is for the best interests of the district that the lands mentioned in the petition or some portion thereof be excluded from the district, or if it appears that the lands or some portion thereof will not be benefited by their continued inclusion in this district, then the board shall make an order that the lands, or such portion thereof as the board may determine, be excluded from the district, describing specifically the lands so excluded.
A copy of the order of exclusion certified by the secretary of the district shall be recorded in the office of the county recorder of the county in which the lands are situated. The record of the certified copy is prima facie evidence of the exclusion from the district of the lands purporting to be excluded thereby.
From and after the making of the order of exclusion and the record thereof the lands excluded are no longer included in the district. The order of exclusion does not invalidate in any manner any taxes or assessments theretofore levied or assessed against the lands excluded nor relieve the property excluded from any outstanding bonds which are a lien thereon at the time of exclusion, nor from any taxes to pay the principal or interest thereof.
ARTICLE 2. Exclusion of Incorporated Territory [27281. - 27284.]
If the city to which any territory included in any district has been annexed already provides transit service in the territory annexed, or if any territory in any district is annexed to a city, not a part of any district as originally established pursuant to this part, and not annexed thereto pursuant to this part, the city council or other governing body of the city may petition the district for the exclusion of such territory from the district.
The petition shall contain the information prescribed for petitions for exclusion under Article 1 of this chapter, a deposit for expenses shall be made as therein provided, and thereafter all proceedings shall be had as provided therein for such petitions after filing.
If an order of exclusion is granted, the board and the governing body of the city shall by contract provide for the payment by the city of the proportion of the taxes and bonded indebtedness for which the territory excluded is justly liable. If they do not agree, either may petition the superior court in and for the county in which the property is located for a judgment declaring the proportion of the taxes and bonded indebtedness for which the territory excluded is justly liable. The proceeding shall be governed by the provisions of the Code of Civil Procedure relating to declaratory relief.
The order of exclusion does not invalidate in any manner any taxes or assessments theretofore levied or assessed against the lands excluded nor relieve the property excluded from any outstanding bonds which are a lien thereon at the time of exclusion, nor from any taxes to pay the principal or interest thereof.
ARTICLE 3. Exclusion of Territory Within or Without City [27291. - 27302.]
The provisions of this article are alternative to any other provisions for the exclusion of territory from the district.
Any time after the defeat of a bond issue by the voters of the district any city or unincorporated territory, a majority of whose voters voting on a district bond issue proposition voted against said proposition, may be excluded by order of the board upon receipt by the board of a verified petition of ten percent (10%) of the total vote cast in the territory proposed to be excluded, or of a resolution adopted by the city council or board of supervisors having jurisdiction of the territory. However, no city shall be divided and not less than one-half of the territory under the jurisdiction of the board of supervisors and then remaining within the district shall be included in any petition or resolution or combination thereof filed simultaneously, nor shall any territory be excluded by any petition or resolution or combination thereof which creates areas of noncontiguous territory or will be entirely surrounded by the remainder of the district.
The petition or resolution shall state the reasons for the proposed exclusion and that the area will not be benefited by inclusion in the district, shall define the boundaries of the area proposed to be excluded, and request that the area be excluded.
If the exclusion is initiated by a city council or a board of supervisors, such legislative body shall hold a public hearing on the proposal to adopt the resolution. A notice of the hearing shall be published once in a newspaper of general circulation published in the area proposed to be excluded, or in a newspaper published within the city and county the legislative body of which has initiated the proceedings, in the event that a newspaper is not published in the area.
The notice of the hearing shall be entitled “Proposal to Exclude the ________ Territory from the ________ Transit District.” The territory shall be designated by an appropriate name descriptive of the area proposed to be excluded. The notice shall also contain a description of the area, state the time and place for a hearing by the legislative body, and shall state that all persons interested in the exclusion may attend and be heard. The hearing shall be held not less than 10 days after publication of the required notice.
The legislative body shall conduct the hearing and at its conclusion, or at the conclusion of a further hearing to which adjournment has been made, may adopt the resolution and transmit it to the board.
Within 60 days after the receipt of a petition for exclusion, the board shall hear the petition or resolution at a regular or adjourned meeting of the board. Notice of the filing of the petition or resolution shall be given by publication of the petition or resolution in a newspaper of general circulation, published in the district and selected by the board. The notice shall also state the date of the filing of the petition or resolution and that it will be considered by the board, and shall state the time and place of the hearing. The time fixed for the hearing shall not be less than 20 days from the date of the first publication of the notice. The property to be excluded may or may not be specifically described in the notice, but if not described, the notice shall refer to the petition or resolution on file for purposes of a particular description of the property sought to be excluded and shall make reference to the property by a descriptive name.
Any landowner or taxpayer within the district may appear at the hearing, either in behalf of or in opposition to the granting of the petition or resolution.
The petition or resolution shall be heard by the board at the time and place specified in the notice of the hearing.
If, upon the hearing the board determines that it is in the best interests of the district that the lands mentioned in the petition or resolution, or some portion of them, be excluded from the district, or if it appears that the lands, or some portion of them, will not be benefited by their continued inclusion in the district, the board shall make an order that the lands, or some portion of them, as the board may determine, be excluded from the district, describing specifically the lands excluded.
In the event that the board shall not make the order excluding all of the area proposed to be excluded within 10 days after the hearing on the petition or resolution for exclusion, the board shall within 120 days thereof order and conduct an election within the area proposed to be excluded upon the question of whether the area shall be excluded from the district, however, if a general election is to be held within the territory proposed to be excluded within six months after the petition or resolution is filed with the secretary of the district the board may consolidate the election requested by this article with the general election. All resident electors of the area shall be eligible to vote at the election. The cost of the election shall be borne by the district.
In the event that a majority of the votes cast at the election are in favor of the exclusion, the board, upon completion of the canvass, shall make an order excluding the area from the district. In the event that a majority of the votes cast at the election are opposed to the exclusion, the measure fails and no proceedings for exclusion of the area may be subsequently initiated within one year.
A copy of the order of exclusion, certified by the secretary of the district, shall be recorded in the office of the county recorder of the county in which the lands are situated. The record of the certified copy shall be prima facie evidence of the exclusion from the district of the lands which are purported to be excluded thereby.
Subsequent to the making and recording of the order of exclusion, the lands excluded shall no longer be a part of the district.
The order of exclusion does not invalidate, in any manner, taxes or assessments previously levied or assessed against the lands excluded, nor relieve the property excluded from any outstanding bonds which are a lien upon the excluded property at the time of exclusion or from any taxes imposed to pay the principal or interest on the bonds.
CHAPTER 10.5. Special Transit Service Districts [27401. - 27481.]
ARTICLE 1. Proposal of Formation [27401. - 27406.]
One or more special transit service districts may be created within the boundaries of a district pursuant to this chapter.
Resolutions shall first be passed by the legislative bodies of half or more, but of not less than two, of the public agencies, within all or any part of the area which would be included in the proposed special transit service district, declaring that the public interest or necessity demands the creation of a special transit service district and describing its boundaries. The boundaries of the proposed special transit service district may include territory outside any such public agency if the territory is within the area of the transit district. When the entire area of a public agency is to be included in the special transit service district it may be described in the resolutions by name. Certified copies of the resolutions shall be filed with the secretary of the district.
As an alternative to the instigation of the formation of a special transit service district by resolutions, a petition may be filed with the secretary of a district signed by voters within the proposed special transit service district equal in number to at least 10 percent of the total vote cast. The boundaries of the proposed special transit service district shall be described in the petition and shall include at least two public agencies or portions thereof. A statement of the name of any public agency constitutes a sufficient and legal description of the territory if the entire area of the agency is included.
The petition shall declare that the public interest or necessity demands the creation of a special transit service district within the area of the district described in the petition. The petition may include one or more separate documents, but each document shall contain the affidavit of the party who circulated it, certifying that each name signed thereto is the true signature of the person whose name it purports to be.
The secretary of the district shall compare the signatures on the petition with the affidavits of registration on file with the county elections official and shall certify to the board as to the sufficiency or insufficiency of the petition.
The board may initiate proceedings for the creation of a special transit service district within the area of the district by passing a resolution declaring that the public interest or necessity demands the creation of a special transit service district, and describing its boundaries, which shall include all or any part of two or more public agencies. A public agency to be included may be described by name if the entire area of the agency is included. No certified copy of the resolution need be filed with the secretary of the district.
ARTICLE 2. Hearing [27411. - 27417.]
Within 60 days after receipt of the resolutions of the public agencies or receipt of the certification of the sufficiency of a petition by the secretary of the district, or the passage of the resolution of the board, the board shall, by resolution, designate the special transit service district as “________ (here insert name) Transit District, Special Transit Service District No. ________ (here insert number)” (all such special transit service districts shall be numbered consecutively) and shall fix a time and place for a hearing on the proposed creation of the special transit service district, and shall publish notice of the hearing.
The notice of hearing shall be published once in a newspaper of general circulation published in the district.
The time fixed for the hearing shall be not less than 20 nor more than 60 days from the date of the publication of the notice.
At or before the hearing, any person interested may file with the secretary of the district written objections to the creation of the special transit service district or to the inclusion of his property therein. Upon the hearing the board shall hear and determine all protests and objections. The hearing may be adjourned from time to time by the board without further notice other than an order to be entered upon the minutes of its meeting fixing the time and place of the adjournment.
The board may reduce or enlarge the boundaries of the proposed special transit service district, but the boundaries of the proposed special transit service district shall be within the boundaries of the district.
The board shall not approve the creation of a special transit service district containing territory in addition to the territory included in the resolutions or petitions filed with the secretary of the district, or in its own resolution, until notice of its intention to include such additional territory has been published for the time and in the manner prescribed for the original hearing on the matter and a hearing is had pursuant to the notice.
If no protests are filed, or if the protests filed are overruled and denied by the board, the board shall by resolution approve the creation of the special transit service district either as originally described or as revised by the board and, except as provided by Article 3 (commencing at Section 27421), shall by resolution order and declare the special transit service district created.
ARTICLE 3. Election [27421. - 27430.]
Any public agency included, or partly included, within the boundaries of a special transit service district may, by a resolution adopted by its legislative body, adopted within 30 days after the adoption of the resolution creating a special transit service district, require the submission of a proposition to the voters of the public agency, or portion thereof, for the purpose of determining whether the public agency, or portion thereof, will be included within the boundaries of the special transit service district. However, no election shall be held, if the board, pursuant to Section 27417, excludes from the territory to be annexed the whole or any portion of a public agency in accordance with the petition or resolution adopted by the legislative body of the public agency.
Instead of the procedure by resolution of a public agency, a petition may be filed with the secretary of the district, signed by voters within any public agency, or portion thereof, included within the boundaries of the special transit service district equal in number to at least 10 percent of the vote cast, requiring an election to be held as described in Section 27421 of this chapter.
The petition may include one or more documents, but each document shall contain the affidavit of the party who circulated it, certifying that each name affixed thereto is the true signature of the person whose name it purports to be. The petition shall be filed within 30 days after the adoption of the resolution creating a special transit service district.
The secretary of the district shall compare the signatures with the affidavits of registration on file with the county elections official and shall certify to the board as to the sufficiency or insufficiency of the petition.
The filing of a resolution pursuant to Section 27421, or of a petition pursuant to Section 27422, shall stay the effective creation of the special transit service district within the public agency or portion thereof included in the resolution or petition until the results of the required election are canvassed.
The ballot for the election shall contain such instructions as are required by law to be printed thereon and in addition thereto the following:
No person is entitled to vote at the election unless he is a voter of the public agency or portion thereof requesting the election. The election may be held on the same day as any other state, county or city election and may be consolidated.
The costs of the election required by this article shall be borne equally by the public agency and the district.
The question of the creation of a special transit service district, submitted to a vote pursuant to this article, shall be canvassed separately for each public agency or portion thereof in which an election is held, and the board shall order and declare the special transit service district created, including each public agency, or portion thereof, in which no election was held pursuant to Section 27426 and also including each public agency, or portion thereof, in which an election was held and in which a majority of those who voted upon the proposition of creating the special transit service district voted in favor of the proposition, and excluding each public agency, or portion thereof, in which an election was held and in which a majority of those who voted upon the proposition of creating the special transit service district voted against the proposition.
ARTICLE 4. Taxing Subdivision [27441. - 27441.]
A special transit service district has no separate corporate existence, but shall be deemed to be a taxing subdivision of the district, and within each special transit service district the board may levy and collect or cause to be collected taxes for any lawful purpose in accordance with Article 8 (commencing at Section 25891) of Chapter 6.
ARTICLE 5. Bond Election [27451. - 27456.]
At any time after the adoption by the board of the resolution creating a special transit service district, notwithstanding the effective date of the resolution, the board may provide for the submission of a proposition for the incurring of a bonded indebtedness to be incurred by the district on behalf of the special transit service district to pay the costs of acquiring, constructing, or completing the whole or any portion of any transit facilities, or for acquiring any works, lands, structures, rights, equipment, or other property necessary or convenient to carry out the objects, purposes or powers of the district within the boundaries of a special transit service district created pursuant to this chapter.
The proposition for incurring a bonded indebtedness under Section 27451 may be submitted to the voters of any public agency or portion thereof at the same election as a proposition to create the special transit service district within a public agency or portion thereof, held pursuant to Article 3 (commencing at Section 27421). In such event a proposition for incurring a bonded indebtedness shall be submitted at a separate special bond election in all portions of the special transit service district in which no election is held pursuant to Article 3 (commencing at Section 27421).
Except as otherwise provided in this article, the provisions of Chapter 7 (commencing at Section 26201) shall substantially govern as to all matters pertaining to the issuance of bonds under this article, including, among other things and without limiting the generality of the foregoing, the calling, holding, and consolidation of the bond election, the formation, execution, issuance, maturity, redemption, refunding, validation, the payment of interest from bond funds, and the status of the bonds as investments.
The favorable vote of a majority of all the voters voting on the proposition to authorize the issuance of bonds at the election or elections held pursuant to Sections 27451 or 27452 within the special transit service district as finally established is required to authorize the issuance of the bonds.
Only the property in the special transit service district shall be taxable for the payment of the principal and interest on special transit service district bonds. Until the bonds are paid, taxes shall be levied in substantial compliance with Section 25893.
Any proceeding denying the validity of the creation of any special transit service district, or of any bonds authorized by the voters thereof, pursuant to this part, shall be brought within three months after the date upon which the applicable resolution is adopted by the board or the applicable proposition is approved by the voters.
ARTICLE 6. Annexation [27461. - 27473.]
Any public agency or portion thereof within the boundaries of a district, hereafter referred to collectively as “territory,” not included within the boundaries of a special transit service district, may be annexed thereto in the manner provided in this article.
The board shall, by resolution, determine that the annexation of the territory will facilitate the acquisition or operation of transit facilities for the special transit service district, describe the territory, declare its intention to annex the territory to the special transit service district, set forth the terms and conditions upon which the territory shall be annexed, fix the time and place for hearing on the question of the annexation, and provide for notice of the hearing.
Any public agency or portion thereof included as part of the territory to be annexed to a special transit service district pursuant to this article may, by resolution of its legislative body, or a petition of its voters filed prior to the hearing on annexation, require the submission of an annexation proposition to the voters of the public agency, or portion thereof.
Except as otherwise provided herein, Article 3 (commencing at Section 27421) shall govern the procedure for the submitting of the annexation proposition to the voters of any public agency or portion thereof involved; provided, that no election shall be held if the board, pursuant to Section 27468, excludes from the territory to be annexed the whole or any portion of a public agency in accordance with its petition or resolution.
The terms and conditions for the annexation of territory to a special transit service district may provide (among other things) for the payment of taxes within the territory to be annexed, in addition to the taxes otherwise provided for in this part, the fixing of rates, rentals, and charges differing from those fixed or existing elsewhere, within the special transit service district, the making of a payment or payments, or the transfer of property, real and personal, and other assets to the district by the territory proposed to be annexed.
Notice fixing the time and place for hearing on the question of the annexation of territory to a special transit service district shall be published once in a newspaper of general circulation published in the district.
The time for hearing shall be not less than 20 nor more than 60 days from the date of the publication of the notice.
At or before the hearing, any person interested may file with the secretary of the district written objections to the annexation of the territory to the special transit service district or to the inclusion of his property. Upon the hearing, the board shall hear and determine all protests and objections.
The hearing may be adjourned from time to time by the board without further notice other than an order entered upon the minutes of its meeting fixing the time and place of adjournment. In the event that no protests are filed or the protests filed are overruled and denied, the board shall, by resolution, declare the territory, or a portion thereof, annexed to the special transit service district.
From and after the date of filing of the resolution with the secretary of the district the annexation of the territory, or portion thereof, to the special transit service district is complete; provided, that if pursuant to Sections 27463 and 27464 of this article, an annexation election is to be held, the annexation is stayed until the canvassing of the results of said election.
From and after the date of annexation any territory annexed to a special transit service district is liable for payment of its proportionate share of any indebtedness then existing and payable by the special transit service district. From and after the date of annexation the board shall levy upon all of the property in the territory annexed such taxes, tolls, or charges as are necessary to comply with the terms and conditions of annexation, in addition to any other district taxes otherwise authorized in this part.
Upon the completion of the annexation of any territory in accordance with law to any city included, or partially included, in a special transit service district, the city clerk shall file with the secretary of the district a certified copy of the ordinance, resolution or other document completing said annexation, containing a description of the territory so annexed. Unless the district within 90 days after such filing shall file with the city clerk the district’s written objections to the annexation to the special transit service district of said territory or portion thereof, such territory, or portion thereof, shall, upon the termination of such period be deemed incorporated into and annexed to the special transit service district, and thereafter is subject to taxation, along with the entire territory of the special transit service district in accordance with the assessable valuation of the property thereof, for special transit service district purposes, and for the payment of any indebtedness theretofore or thereafter incurred by the special transit service district.
If the district shall file its objections in the manner aforesaid to the annexation to a special transit service district of such territory or portion thereof, the territory, or portion thereof, shall not be annexed to the special transit service district except in the manner provided in Article 6 (commencing with Section 27461) of this chapter. The district may withdraw such objections by filing with the city clerk a certified copy of a resolution of the board stating that such objections are withdrawn. Thereupon such territory, or portion thereof, shall be deemed incorporated into and annexed to the special transit service district as provided in Section 27472.
ARTICLE 7. Dissolution [27481. - 27481.]
A special transit service district may be dissolved by resolution of the board if any proposition for the incurring of a bonded indebtedness fails to carry, and if the special transit service district is then subject to no other indebtedness or liability pursuant to this part and has been organized for not less than two years. Dissolution of a special transit service district shall not prevent subsequent proceedings for the creation of a special transit service district including the same or any part of the area of the special transit service district dissolved.
CHAPTER 11. Dissolution [27501. - 27509.]
The board of any district which operates no transit facilities, or with exterior boundaries coincident with the boundaries of a single city, may call an election at any time for the purpose of submitting to the voters of the district the question of whether the district will be dissolved. Upon the filing with the secretary of such a district of a petition signed by voters within the district equal in number to at least 25 percent of the total vote cast, asking that the question of dissolution of the district be submitted to the voters of the district, the board shall call such an election.
The election for the purpose of submitting to the voters of the district the question of whether or not the district shall be dissolved shall be held on the next established election date not less than 74 days next succeeding the date on which the petition is filed.
Notice of any election for dissolution, whether called because of the filing of a petition or ordered by the board without petition, shall be published. The date fixed for the election shall not be less than 30 days from the date of the first publication of the notice.
The ballots for the election shall contain substantially the instructions required to be printed on ballots for use at general state and county elections and in addition the following:
No other notice of the election other than that provided for in this chapter need be given and no sample ballots need be sent to the voters.
If upon a canvass of the election it is found that a majority of all votes cast on the proposition at the election were in favor of the dissolution, the dissolution shall be deemed carried and approved by the voters. The board shall meet on Monday next succeeding the election and canvass the votes cast.
Upon dissolution of any district which has boundaries that are coincident with the corporate limits of a city, the district property wherever situated vests absolutely in the city, and upon the dissolution of any district operating no transit facilities and which has boundaries that extend beyond the boundaries of a single city the property of the district wherever situated vests in the county in which the whole or greater portion of the district is situated.
If at the time of dissolution there is any outstanding indebtedness of the district the legislative authority of the city, where the limits of the district lie wholly within the corporate limits of a city, and in all other cases the board of supervisors of the county in which the whole or greater portion of the district is situated are ex officio the board of directors of the district for the purpose only of the levy and collection of taxes for the payment of the indebtedness of the district existing at the time of dissolution and the interest thereon. The board or legislative authority shall levy the taxes and perform such other acts as are necessary to raise the money necessary for the payment of the indebtedness and the interest thereon.
In the event that the proposition for dissolution fails to carry, no subsequent election for the dissolution of the district shall be called until after the expiration of one year from the date of the prior election.
PART 2. SAN FRANCISCO BAY AREA RAPID TRANSIT DISTRICT [28500. - 29757.]
CHAPTER 1. General Provisions and Definitions [28500. - 28509.]
This part is known and may be cited as the “San Francisco Bay Area Rapid Transit District Act.”
This part is in furtherance of the declared policy of the State to stimulate the maximum use of the harbor in San Francisco Bay in order to foster and develop international and other trade for the benefit of the entire State.
The geographical situation of San Francisco Bay, which makes it one of the finest harbors in the world, at the same time prevents the full utilization of the harbor by acting as a physical barrier to a system of rapid and effective transportation between the various portions of the metropolitan area surrounding the Bay.
Only a specially created district can freely operate in the eighty-four (84) individual units of county, city and county, and city governments located in this area. Because of the unique problems presented by the area it is necessary that this legislation be applicable solely to such area to insure necessary rapid transit service.
Extensive studies and surveys have been made at considerable cost in public funds to determine whether or not interurban mass rapid transit would be a feasible instrument for reducing existing and future interurban travel problems and for relieving existing and future traffic congestion on freeways, streets and highways. These surveys have produced convincing evidence that the prosperity of the entire Bay area will depend upon the preservation and enhancement of its urban centers and subcenters; and that sustaining these centers and subcenters as concentrations of employment, commerce, and culture, in turn will depend upon providing an adequate, modern, interurban mass rapid transit system.
The studies have also established that to provide a standard of service which will meet the needs of the public, the interurban system must be effectively separated from conflicting traffic either by grade separation of intersecting streets, roads, and highways, or by other equally effective means; and, to the extent practicable, its service must be coordinated with that of other transit facilities in the areas served.
The part shall be liberally construed to carry out the objects and purposes and the declared policy of the State of California as in this part set forth.
Unless the context otherwise requires, the provisions of this chapter govern the construction of this part.
“District” as used in this part, means the San Francisco Bay Area Rapid Transit District.
“San Francisco Bay area,” as used in this part, means the Counties of San Francisco, Marin, Sonoma, Napa, Solano, Contra Costa, Alameda, Santa Clara and San Mateo.
“Rapid transit,” as used in this part, means the transportation of passengers and their incidental baggage by any means.
For the purpose of establishing the bonded debt limit of the district, “taxable property,” as used in this part, shall not include solvent credits.
“Board of supervisors,” as used in this part, means the board of supervisors of a county in the San Francisco Bay area.
“Board of directors,” “board,” or “directors,” as used in this part, means the board of directors of the district.
“Public agency,” as used in this part, includes the State of California, and any county, city and county, city, district, or other political subdivision or public entity of, or organized under the laws of, this State.
CHAPTER 2. Creation of District [28600. - 28602.]
There is hereby created the San Francisco Bay Area Rapid Transit District, comprising the territory lying within the boundaries of the Counties of Alameda, Contra Costa, Marin, San Francisco, and San Mateo.
Through compliance with the provisions for withdrawal set forth in Chapter 10 of this part, the territory of any of the Counties of Alameda, Contra Costa, Marin, San Francisco, and San Mateo may be withdrawn from the district.
Through compliance with the provisions for annexation set forth in Chapter 9 of this part, the territory of all or any of the Counties of Napa, Santa Clara, Solano, or Sonoma may be included within the district.
CHAPTER 3. Government of District [28745. - 28845.]
ARTICLE 2.2. District Board of Directors [28745. - 28748.8.]
On and after November 29, 1974, the governing body of the district shall be a board of directors consisting of nine members elected by election districts, except as provided in Section 28752.6.
The nine election districts shall be established within the district as provided in this article by resolution adopted by the board.
The board, in dividing the district into election districts, shall establish and define the boundaries of the nine election districts within the territory of the district, and shall number the election districts from 1 to 9, inclusive. The boundaries of the election districts shall be defined so that the districts shall be as nearly equal in population as practicable, considering the factors specified in Section 28745.6.
In establishing the election districts, consideration shall be given to the following factors:
Community of interest of the population within an election district.
Cohesiveness, contiguity, integrity, and compactness of territory.
Topography.
Geography.
Boundaries of the election districts need not conform to the boundaries of counties, cities, cities and counties, or districts, or of wards or election districts established for the nomination or election of any officers thereof, or of Assembly, Senate, or congressional districts.
The establishment of election districts shall be made on the basis of the population in the district as shown or estimated from the most recent of any of the following: the last federal decennial census; any census of a county, taken as provided in Section 26203 of the Government Code, or census of a city, taken as provided in Chapter 17 (commencing with Section 40200), Part 2, Division 3, Title 4 of the Government Code; any census or population estimate of a city or of a city and county, taken or made as provided in Section 2107.1 or 2107.2 of the Streets and Highways Code; or population estimates contained in any official document prepared by the Department of Finance and issued to the public.
The resolution establishing the election districts shall describe the boundaries of the election districts by reference to a map or maps on file with the district secretary. Immediately upon adoption of the resolution, the secretary shall file a certified copy of the map or maps describing all nine election districts with the Secretary of State and with the county elections official of each county with territory within the boundaries of the district.
All cities, counties, and cities and counties within the district shall provide such information, services, and facilities as may be required in apportioning the district into the nine election districts.
Until the election and qualification of the first elected board, the members of the board in office on January 1, 1974, shall remain in office, shall receive the compensation and expenses prescribed in this part for the office, and shall be the governing body of the district. The term of office of the nonelected board shall end at noon on November 29, 1974.
A general district election for the election of directors whose terms are to expire in that year shall be held and conducted on the first Tuesday after the first Monday in November of each even-numbered year and shall be consolidated, where possible, with the general election held on that date.
Except as otherwise provided in this article, candidates for the board shall be nominated, the election held and conducted, and the ballots canvassed in accordance with the provisions of the Uniform District Election Law.
Each candidate for the board shall file a declaration of candidacy in the form and manner prescribed in the Uniform District Election Law (Part 4 (commencing with Section 10500) of Division 10 of the Elections Code) with the county elections official of the county in which the candidate resides. Candidates for the board shall be residents and voters of the district and of the geographical area making up the election district from which they are to be elected.
A candidate for election from any of the election districts shall be nominated and elected by the voters residing within the election district from which he is elected.
The county elections official of each county within the boundaries of the district shall conduct the election and canvass the returns for those election districts or portions of election districts which are within the county of his or her jurisdiction as county elections official. After the official canvass has been taken, the county elections official shall report the returns, by election district number, to the board. The board shall declare the results of the election. The secretary of the district shall issue certificates of election, signed by him or her and duly authenticated, to each candidate declared elected, immediately following determination of the results of the election by the board.
Members of the board shall be residents and voters of the district and of the geographical area making up the election district from which they are elected. The office shall be deemed to be vacant if a member ceases to meet these requirements.
The candidate from each election district receiving the highest number of votes cast for the board in that election district shall be declared elected.
If a tie vote makes it impossible to determine which of two or more candidates has been elected, the existing board shall resolve the tie by lot and declare the results thereof as provided in Section 10551 of the Elections Code.
Each member of the first elected board shall take office at noon on November 29, 1974. The term of office of the elected directors shall be four years, except that the term of office of the first elected board shall be either two years or four years. At the first regular meeting of the first elected board, the board shall determine, by lot, whether the directors elected from the even- or odd-numbered election districts shall have terms of office expiring at noon on the last Friday in November 1976 or November 1978, as the case may be.
Until November 29, 1974, any vacancy on the board shall be filled for the remainder of the unexpired term in the same manner as the vacating member was appointed. Thereafter, any vacancy on the board shall be filled by appointment for the remainder of the unexpired term by the remaining members of the board. Any person so appointed shall meet the requirements set forth in Section 28747.6.
The board may by ordinance or resolution provide that each director shall be paid a sum that shall not exceed one thousand dollars ($1,000) for each calendar month that he or she serves as a director. The board may, by ordinance or resolution, provide for an adjustment to the monthly compensation based upon the percentage increase in the California Consumer Price Index, as calculated by the Department of Finance, for each calendar year following the operative date of the last adjustment. The adjustment shall not become effective until the next regular election of the directors following the adoption of the ordinance or resolution.
The ordinance or resolution to authorize a monthly stipend pursuant to subdivision (a), in lieu of per-meeting compensation, shall include a requirement that a member can receive a monthly stipend for a given month only if he or she attends all scheduled and noticed regular board meetings for that month. For those members meeting this attendance requirement, the amount of one hundred dollars ($100) shall be deducted from the stipend for failure to attend each meeting of a committee on which he or she serves that month. In any month that a member fails to meet these attendance requirements, that member may be compensated at the rate of one hundred dollars ($100) per board or committee meeting attended, not to exceed five hundred dollars ($500) for that month.
For the purpose of this section, a member who misses a scheduled and noticed meeting of the board or a committee while attending to official district business pursuant to authorization shall be construed as having attended the meeting.
The ordinance or resolution may provide for not more than two excused absences during a calendar year without disqualifying the member for a monthly stipend.
In addition to the compensation otherwise provided for in this section, each director may be allowed necessary traveling and personal expenses incurred solely as a result of the performance of his or her duties, in amounts as may be authorized by the board. Reimbursement for these expenses is subject to Sections 53232.2 and 53232.3 of the Government Code.
ARTICLE 2.4. Redistricting of Election Districts [28750. - 28750.8.]
Following each federal decennial census and using the census as a basis, the board shall, by resolution, adjust the boundaries of the election districts so that the districts shall be as nearly equal in population as practicable, considering the factors specified in Section 28745.6.
The boundaries of the election districts shall be adjusted by the board before November 1 of the year next succeeding the year in which each federal decennial census is taken.
Notwithstanding Section 28745, if the board fails to adjust election district boundaries pursuant to this article before the December 31 of the year next succeeding the year in which each federal decennial census is taken, each director to be elected at that election shall have the qualifications required in Section 28747.6, but shall be elected at large. Directors shall continue to be so elected until the board adjusts the election district boundaries.
The resolution reestablishing the election districts shall describe the new boundaries of the election districts by reference to a map or maps on file with the secretary of the district. Immediately upon adoption of the resolution, the secretary shall file a certified copy of the resolution and the map or maps describing all election districts with the Secretary of State and with the county elections official of each county with territory within the boundaries of the district.
If, at any time between each federal decennial census, the district annexes territory, pursuant to Chapter 9 (commencing with Section 29500), the board, within 90 days after completion of the annexation proceedings, shall, by resolution, adjust the boundaries of the election districts so that the district shall be as nearly equal in population as practicable, considering the factors specified in Section 28745.6.
The term of office of any director who has been elected and whose term of office has not expired shall not be affected by any change in the boundaries of the election district from which he was elected.
At the first election for directors following adjustment of the boundaries of the election districts, a director shall be elected for each election district under the readjusted election district plan that has the same number as an election district whose incumbent’s term is due to expire.
Notwithstanding any other provision of this article, a change in the boundaries of an election district shall not be made within 90 days prior to the final date of voter registration for an election of directors.
ARTICLE 2.6. Board Selection Election [28752. - 28752.8.]
Not later than January 31, 1974, the board of supervisors of any county included within the district may adopt a resolution declaring that, in its judgment, the members of the board of directors should be appointed as provided in Article 2 (commencing with Section 28730), rather than elected as provided in Article 2.2 (commencing with Section 28745).
If the boards of supervisors of two or more counties included within the district adopt resolutions pursuant to Section 28752, the board of directors shall call a special election which shall be consolidated with the direct primary election to be held on June 4, 1974.
The board of directors shall provide for the publication of notice of the election pursuant to Section 6066 of the Government Code. The first publication of notice shall be made between May 1 and May 15, 1974.
The ballot for the election shall contain substantially the instructions required to be printed on ballots for use at general elections and the following proposition substantially as follows:
If a majority of the votes cast in the district on the proposition are in favor of the proposition, the members of the board of directors from that county shall be elected and shall serve as provided in Article 2.2 (commencing with Section 28745).
If a majority of the votes cast in the district on the proposition are not in favor of the proposition, the members of the board of directors shall be appointed and shall serve as provided in Article 2 (commencing with Section 28730).
The results of the election shall be entered into the minutes of the board of directors.
ARTICLE 3. Powers and Duties of Directors [28760. - 28774.]
Each director, before entering upon the duties of his office, shall take the oath of office as provided for in the Constitution and laws of this State. A copy of the oath shall be filed with the secretary of the district and the Secretary of State.
The board shall choose one of its members president, and another vice president, who shall be authorized to act for the president during his absence or disability. The board shall choose a secretary, who shall not be a member of the board, and shall provide for the time and place of holding its meetings which shall be held at least once each month. The president shall be paid a salary of five thousand dollars ($5,000) per year. The vice president shall be paid a salary of three thousand dollars ($3,000) per year. Such salaries shall be in addition to any payments authorized under Section 28748.8.
The board of directors is the legislative body of the district and, consistent with the provisions of this part, shall determine all questions of district policy.
The district may do any and all things necessary to carry out the purposes of this part.
The board shall determine what transit facilities should be acquired or constructed, and may establish zones within the district to undertake the acquisition or construction of any transit facilities.
The board may determine what transit facilities should be acquired or constructed:
For the common benefit of the district as a whole; or
For the benefit of two or more zones; or
For the benefit of a single zone.
The board shall supervise and regulate every transit facility owned and operated by the district, including the fixing of rates, rentals, charges, and classifications, and the making and enforcement of rules, regulations, contracts, practices, and schedules, for or in connection with any transit facility owned or controlled by the district.
The board may adopt a personnel system for the purpose of recruiting and maintaining an effective working force with good morale. The board shall by resolution determine and create such number and character of positions as are necessary properly to carry on the functions of the district and shall establish an appropriate salary, salary range, or wage for each position so created. The board may by resolution abolish any such position. Except as otherwise provided, appointments to such positions shall be made by the general manager.
Not later than October 12, 1974, the board shall adopt an affirmative action program approved by the Office of Federal Contract Compliance of the Department of Labor.
The district is authorized to maintain a police department. The employees of the district that are appointed as members of such department by the general manager and duly sworn are peace officers; provided, that such officers shall not exercise their powers or authority except as provided in Chapter 4.5 (commencing with Section 830) of Title 3 of Part 2 of the Penal Code. The district shall adhere to the standards for recruitment and training of peace officers established by the Commission on Peace Officer Standards and Training pursuant to Title 4 (commencing with Section 13500) of Part 4 of the Penal Code.
The board may establish an office of independent police auditor, reporting directly to the board, to investigate complaints against district police personnel.
The appointed independent police auditor shall have the following powers and duties:
To investigate those complaints or allegations of on-duty misconduct and off-duty unlawful activity by district police personnel, within the independent police auditor’s purview as it is set by the board.
To reach independent findings as to the validity of each complaint.
To recommend appropriate disciplinary action against district police personnel for those complaints determined to be sustained.
The board shall organize, reorganize, and manage the office of the independent police auditor. Notwithstanding the authority granted the general manager in this part, the board may, by resolution, authorize a citizen review board to participate in recommending appropriate disciplinary action.
The independent police auditor shall prepare, in accordance with the rules of the office, reports of his or her activities as permitted by law.
The board of directors may contract for or employ any professional services required by the district or for the performance of work or services for the district which, in the board of director’s opinion, cannot satisfactorily be performed by the officers or employees of the district.
The board shall have an annual audit made of all books and accounts of the district by an independent certified public accountant or public accountant.
The board shall operate an automated management information system to enable it to submit a report monthly to the Metropolitan Transportation Commission and the office of the Legislative Analyst on the district’s expenditures as compared to the projected expenditures in its budget, and the board shall submit such report to the commission and that office.
As soon as practicable after the close of each fiscal year the board of directors shall submit to the chief administrative officer and legislative bodies of cities and counties within the district a financial report showing the result of operations during the preceding fiscal year and the financial status of the district on the final day thereof. Copies of the report shall be supplied to the general public upon request in the quantity deemed appropriate by the board.
The board may provide by resolution, under such terms and conditions as it sees fit, for the payment of demands against the district without prior specific approval thereof by the board if the demand is for a purpose for which an expenditure has been previously approved by the board and in an amount no greater than the amount so authorized, and if the demand is approved by the general manager.
To facilitate the business of the district, the board may provide for the creation and administration of such funds as the needs of the district may require. The funds shall be disbursed in accordance with rules established by the board and all payments from any fund shall be reported to the board.
The board of directors may hold public hearings, subpoena witnesses, and perform all other acts necessary to properly carry out its duties. The board may delegate such authority to other officers of the district who shall report thereon to the board. In the case of public hearings, including those pursuant to Sections 29039 to 29046, inclusive, authority may be so delegated to a referee, who need not be an officer of the district.
Each director may administer oaths and affirmations in any district investigation or proceeding.
ARTICLE 4. Meetings and Legislation [28790. - 28796.]
All meetings of the board of directors, whether regular or special, shall be open to the public.
A majority of the board of directors shall constitute a quorum for the transaction of its business.
The board of directors shall adopt rules to govern its proceedings.
The acts of the board shall be expressed by motion, resolution, or ordinance. No ordinance shall be passed by the board on the day of its introduction, nor within three days thereafter, nor at any time other than a special, regular, or adjourned regular meeting. No ordinance, resolution, or motion shall have any validity or effect unless passed by the affirmative votes of a majority of the directors. No ordinance shall take effect until the expiration of 30 days following its adoption, except the following which shall take effect upon adoption: an ordinance relating to an election, or to the issuance or sale of bonds, or to the levying or collection of taxes, or the fixing of fares; or an ordinance necessary for the immediate preservation or protection of the property, interests, or welfare of the district, which shall contain a specific statement showing its urgency, and which shall be passed by two-thirds of the total vote of the directors. All ordinances except those which take effect upon their adoption shall be subject to referendum in the manner provided by law for the legislative acts of boards of supervisors of counties.
All ordinances shall be published after passage.
The enacting clause of all ordinances shall be as follows: “Be it enacted by the Board of Directors of the San Francisco Bay Area Rapid Transit District:”
All ordinances shall be signed by the president or the vice president of the board, and attested by the secretary.
ARTICLE 5. Officers [28810. - 28818.]
The officers of the district shall consist of the following:
The members of the board of directors.
A president and a vice president of the board, each of whom shall be a member of the board.
A secretary.
A general manager.
A general counsel.
Any other or subordinate officers, assistants, and deputies as the board may deem necessary and provide for by ordinance or resolution.
The general counsel shall be a person admitted to practice law in the Supreme Court of California and shall have been actively engaged in the practice of law for not less than 10 years next preceding appointment pursuant to Section 28811.
The secretary, general manager, and general counsel shall be appointed by and may be removed by the affirmative votes of a majority of the members of the board of directors. All other officers and employees shall be appointed by the general manager and shall serve at the pleasure of the general manager, subject to the provisions of this part relating to personnel.
The general manager shall appoint a chief financial officer and may designate other financial personnel to undertake any of the duties or responsibilities assigned to the chief financial officer under this part.
The compensation of all district officers and employees, except as otherwise provided in this part, shall be fixed by ordinance or resolution of the directors.
The board may consolidate any of the district offices in one person.
The oath of office of all officers appointed by the board of directors or by the general manager of the district shall be taken, subscribed, and filed with the secretary of the district at any time after the officer has notice of his appointment but not later than fifteen (15) days after the commencement of his term of office. No other filing is required.
Each officer shall give such bond and in such amount as the board may require.
Article 4 (commencing at Section 1090), Chapter 1, Division 4, Title 1, of the Government Code shall apply to all officers and contracts of the district.
The chief financial officer shall be the custodian of the funds of the district and shall make payments only upon warrants duly and regularly signed by the general manager. The chief financial officer shall keep an account of all receipts and disbursements.
With the consent of the general manager, who shall seek consent from the board when deemed necessary, the chief financial officer may:
Authorize any state or national bank in this state, a federally chartered or state chartered savings and loan association, or a trust company authorized to act as such in this state, to receive as the agent of the chief financial officer deposits of any securities acquired by the district.
Place and maintain for safekeeping with any state or national bank in this state, a federally chartered or state chartered savings and loan association, or a trust company authorized to act as such in this state, any securities owned by the district.
Make deposits of securities for safekeeping pursuant to the provisions of Section 53608 of the Government Code.
The financial institution selected pursuant to subdivision (a) shall have a total paid-in capital of at least one million dollars ($1,000,000). The chief financial officer shall take from the financial institution a receipt for the securities, and neither the chief financial officer nor the district is responsible for the custody and safe return of the securities until they are withdrawn from the financial institution by the chief financial officer. Any financial institution to which securities are delivered, either as agent or depositary for the chief financial officer, shall make such disposition of the securities as the chief financial officer directs and is responsible only for strict compliance with written instructions given to it by the chief financial officer. All such securities are at all times subject to the order of the chief financial officer.
ARTICLE 6. General Manager [28830. - 28836.]
The board shall appoint and fix the salary of a general manager, who shall have charge, subject to the direction and control of the board, of the acquisition, construction, maintenance, and operation of the facilities of the district and also of the administration of the business affairs of the district.
All other things being equal, the general manager shall be chosen on the basis of his qualifications with special reference to his actual experience in or his knowledge of accepted practices in respect to the duties of his office as hereinafter set forth.
The general manager need not be a resident of this State at the time of his appointment.
The general manager shall hold office for an indefinite term and may be removed by the board only upon the adoption of a resolution by the affirmative vote of not less than a majority of the board. Before the general manager may be removed, he shall, if he demands it, be given a written statement of the reasons alleged for his removal and he shall have the right to be publicly heard thereon at a meeting of the board prior to the final vote on the resolution providing for his removal, but pending and during such hearing the board may suspend him from office. The board may not reduce the salary of the general manager below the amount fixed at the time of his original appointment except upon the adoption of a resolution by a like vote and after a like opportunity to be heard. The action of the board in suspending or removing the general manager or reducing his salary, if approved by a majority of the membership of the board, is final.
The powers and duties of the general manager are:
To have charge, subject to the direction and control of the board, of the acquisition, construction, maintenance, and operation of the facilities of the district.
To have charge, subject to the direction and control of the board, of the administration of the business affairs of the district.
To see that all ordinances of the district are enforced.
To administer the personnel system adopted by the board and except for officers appointed by the board to appoint, discipline or remove all officers and employees subject to the rules and regulations adopted by the board and the applicable provisions of this part.
To prepare and submit to the board as soon as practical after the end of each fiscal year a complete report of the finances and administrative activities of the district for the preceding year.
To keep the board advised as to the needs of the district.
To prepare or cause to be prepared all plans and specifications for the construction of the works of the district.
To devote his entire time to the business of the district.
To perform such other and additional duties as the board may require.
To cause to be installed and maintained a system of auditing and accounting which shall completely and at all times show the financial condition of the district.
The general manager shall attend meetings of the board as directed by the board.
The directors may appoint a general manager pro tempore during any absence or disability of the general manager.
ARTICLE 7. The Office of the BART Inspector General [28840. - 28845.]
There is hereby created in the district an independent Office of the BART Inspector General to ensure that the district makes effective use of bridge toll revenue and other revenue and operates efficiently, effectively, and in compliance with applicable federal and state laws.
The board shall nominate three persons to the Governor who shall appoint one of the three persons nominated by the board to serve as the BART Inspector General for an initial four-year term. The board shall have the option to renew the term at will. The BART Inspector General shall be removed from office by the board, subject to approval of the Governor, only if either of the following occur:
A two-thirds majority of the members of the board votes for removal.
The Inspector General violates a federal or state law or regulation, a local ordinance, or a policy or practice of the authority relative to ethical practices, including, but not limited to, the acceptance of gifts or contributions.
The reasons for removal of the Inspector General shall be stated in writing and shall include the basis for removal. The document stating the reasons for dismissal shall be deemed a public document and posted on the district’s Internet Web site.
Within one year of the operative date of this article, the board shall nominate three persons to serve as the first BART Inspector General to be appointed pursuant to subdivision (b).
The duties and responsibilities of the BART Inspector General shall include, but are not limited to, all of the following:
To examine the operating practices of the district to identify fraud, waste, and opportunities for efficiencies in the administration of programs and operations.
To ensure the BART administration, the board of directors, and the public are fully informed of his or her findings and recommendations.
To identify opportunities to improve the data used to determine project resource allocations.
To conduct, supervise, and coordinate audits and investigations relating to the district’s programs and operations, including, but not limited to, toll-funded programs.
To identify best practices in the delivery of capital projects and recommend policies to enable the district to adopt these practices when practicable.
To recommend policies promoting efficiency in the administration of programs and operations.
To review and recommend best practices that the district should follow to maintain positive and productive relations with its employees and the collective bargaining units representing those employees.
The Office of the BART Inspector General shall receive one million dollars ($1,000,000) from an allocation of bridge toll revenue from the Bay Area Toll Authority. In the second and subsequent years of operation of the office, the authority may increase the amount of funding allocated for this purpose to the extent funds are requested and justified by the office and can be accommodated in the authority’s budget.
The BART Inspector General shall report at least annually to the board of directors and the Legislature with a summary of his or her findings, investigations, and audits. The summary shall be posted on the district’s Internet Web site and shall otherwise be made available to the public upon its release to the board. The summary shall include, but need not be limited to, significant problems discovered by the BART Inspector General and whether recommendations of the BART Inspector General relative to investigations and audits have been implemented by the district.
Any investigatory file compiled by the BART Inspector General is an investigatory file compiled by a local law enforcement agency subject to disclosure pursuant to Article 1 (commencing with Section 7923.600) of Chapter 1 of Part 5 of Division 10 of Title 1 of the Government Code.
This article shall become operative upon an affirmative vote of the residents of the City and County of San Francisco and the Counties of Alameda, Contra Costa, Marin, Napa, San Mateo, Santa Clara, Solano, and Sonoma to increase tolls pursuant to Section 30923 of the Streets and Highways Code on the bridges described in Section 30910 of the Streets and Highways Code.
CHAPTER 4. Labor Provisions [28848. - 28863.]
As used in this chapter, the following definitions apply:
“District” means the San Francisco Bay Area Rapid Transit District, including all operations and extensions of its transportation system, regardless of modality or vehicle type, and excluding all temporary bus lines.
“Employee organization” means an organization that includes employees of the district that has as one of its primary purposes representing those employees in their relations with the district. “Employee organization” shall also include any person of the organization authorized to act on its behalf.
“Exclusive representative” means an accredited employee organization recognized or certified as the exclusive negotiating representative of employees in an appropriate unit within the district.
It is a primary purpose of this chapter to promote the improvement of personnel management and employer-employee relations within the district by providing a uniform basis for recognizing the right of employees to join employee organizations of their own choice, to be represented, to select one employee organization as the exclusive representative of the employees in an appropriate unit, and to afford employees a voice at work.
If a majority of the employees employed by the district in a unit appropriate for collective bargaining indicate a desire to be represented by an employee organization, the board, after determining pursuant to Section 28851 that the employee organization represents the employees in the appropriate unit, shall bargain with the exclusive representative of those employees. Both parties shall bargain in good faith and make all reasonable efforts to reach agreement on the terms of a written contract governing wages, salaries, hours, working conditions, and grievance procedures.
If a dispute arises over the terms of a written contract governing wages, salaries, hours, or working conditions that is not resolved by negotiations conducted in good faith between the board and the exclusive representative, then upon the agreement of both parties, the board and the exclusive representative may submit the dispute to an arbitration board. The decision of a majority of the arbitration board shall be final.
The arbitration board shall be composed of two representatives of the district, two representatives of the exclusive representative, and a fifth member to be agreed upon by the representatives of the district and the exclusive representative.
If the representatives of the district and the exclusive representative are unable to agree on the fifth member, then the names of five persons experienced in labor arbitration shall be obtained from the California State Mediation and Conciliation Service. The exclusive representative and the district shall, alternately, strike a name from the list supplied by the California State Mediation and Conciliation Service. The exclusive representative and the district shall determine by lot who shall first strike a name from the list. After the exclusive representative and the district have stricken four names, the name remaining shall be designated as the arbitrator.
The district and the exclusive representative shall each pay one-half of the cost of the impartial arbitrator.
A contract or agreement shall not be made with any exclusive representative, employee organization, association, group, or individual that denies membership on any basis listed in subdivision (a) of Section 12940 of the Government Code, as those bases are defined in Sections 12926 and 12926.1 of the Government Code. However, the organization may preclude from membership any individual who advocates the overthrow of the government by force or violence.
The district shall not discriminate with regard to employment against any person on any basis listed in subdivision (a) of Section 12940 of the Government Code, as those bases are defined in Sections 12926 and 12926.1 of the Government Code, except as otherwise provided in Section 12940 of the Government Code.
If there is a question whether an employee organization represents a majority of employees or whether the proposed unit is or is not appropriate, such matters shall be submitted to the California State Mediation and Conciliation Service for disposition. The California State Mediation and Conciliation Service shall promptly hold a public hearing and may, by decision, establish the boundaries of any collective bargaining unit and provide for an election to determine the question of representation. Provided, however, any certification of an employee organization to represent or act for the employees in any collective bargaining unit shall not be subject to challenge on the grounds that a new substantial question of representation within such collective bargaining unit exists until the lapse of one year from the date of certification or the expiration of any collective bargaining agreement, whichever is later.
Whenever the district acquires existing facilities from a publicly or privately owned public utility, either in proceedings by eminent domain or otherwise, to the extent necessary for operation of facilities, all of the employees of such public utility whose duties pertain to the facilities acquired who have been employed by said utility for at least seventy-five (75) days shall be appointed to comparable positions in the district without examination and shall be governed thereafter by the personnel system adopted by the board, and these employees shall be given sick leave, seniority and vacation credits in accordance with the records of the acquired public utility.
The provisions of this section shall apply only to those officers or supervisory employees of the acquired utility as shall be designated by the board.
Whenever the district acquires existing facilities from a publicly or privately owned public utility, either in proceedings in eminent domain or otherwise, that has a pension plan in operation, members and beneficiaries of such pension plan shall continue to have the rights, privileges, benefits, obligations and status with respect to such established system; provided, however, that the outstanding obligations and liabilities of such public utility by reason of such pension plan have been considered and taken into account and allowance made for in the purchase price of such public utility.
The persons entitled to pension benefits as provided for in Section 28853 and the benefits which are provided shall be specified in the agreement or order by which any public utility is acquired by the district.
All persons receiving pension benefits from such acquired public utility and all persons entitled to pension benefits under the pension plan of such acquired public utility may become members or receive pensions under the retirement system established by the district by mutual agreement of such persons and the district.
Exclusive representatives shall have the right to represent their bargaining unit members in employer-employee relations with the district, and employees shall have the right to be represented by their exclusive representative.
This chapter is not intended to adversely affect any rights afforded to exclusive representatives or district employees under existing law, as it may be amended from time to time.
The district shall give reasonable written notice to an exclusive representative of its intent to make any change to matters within the scope of representation of the employees represented by the exclusive representative for purposes of providing the exclusive representative a reasonable amount of time to negotiate with the district regarding the proposed changes.
It is unlawful for the district to do any of the following:
Impose or threaten to impose reprisals on employees, to discriminate or threaten to discriminate against employees, or otherwise to interfere with, restrain, or coerce employees because of their exercise of rights guaranteed to them by this chapter. As used in this subdivision, “employee” includes an applicant for employment or reemployment with the district.
Deny employee organizations rights guaranteed to them by this chapter.
Refuse or fail to meet and negotiate in good faith with an exclusive representative. Knowingly providing an exclusive representative with inaccurate information, whether or not it is in response to a request for information, constitutes a refusal or failure of the district to meet and negotiate in good faith with the exclusive representative.
Dominate or interfere with the formation or administration of any employee organization, or contribute financial or other support to it, or in any way encourage employees to join any employee organization in preference to another.
Refuse to participate in good faith in mutually agreed upon impasse procedures.
It is unlawful for an employee organization to do any of the following:
Impose or threaten to impose reprisals on employees, discriminate or threaten to discriminate against employees, or otherwise interfere with, restrain, or coerce employees because of their exercise of rights guaranteed to them by this chapter.
Refuse or fail to meet and negotiate in good faith with the district concerning any of the employees of which it is the exclusive representative.
Refuse to participate in good faith in mutually agreed upon impasse procedures.
This chapter shall not displace, or supplant, the requirements of Chapter 3 (commencing with Section 3610) of Division 4.5 of Title 1 of the Government Code, and the impasse resolution and injunctive relief procedures provided for pursuant to Sections 3612 to 3614, inclusive, of the Government Code shall remain exclusive.
The initial determination as to whether the charge of unfair practice is justified and, if so, the appropriate remedy necessary to effectuate the purposes of this chapter, is a matter within the exclusive jurisdiction of the Public Employment Relations Board, except that in an action to recover damages due to an unlawful strike, the Public Employment Relations Board shall have no authority to award strike-preparation expenses as damages, and shall have no authority to award damages for costs, expenses, or revenue losses incurred during, or as a consequence of, an unlawful strike.
Any charging party, respondent, or intervenor aggrieved by a final decision or order of the Public Employment Relations Board in an unfair practice case, except a decision of that board not to issue a complaint in such a case, may petition for a writ of extraordinary relief from that decision or order.
A petition for a writ of extraordinary relief shall be filed in the district court of appeal having jurisdiction over any county in which the district operates. The petition shall be filed within 30 days from the date of the issuance of the Public Employment Relations Board’s final decision or order, or order denying reconsideration, as applicable. Upon the filing of the petition, the court shall cause notice to be served upon the Public Employment Relations Board and thereafter shall have jurisdiction of the proceeding. The Public Employment Relations Board shall file in the court the record of the proceeding, certified by that board, within 10 days after the clerk’s notice unless that time is extended by the court for good cause shown. The court shall have jurisdiction to grant any temporary relief or restraining order it deems just and proper, and in like manner to make and enter a decree enforcing, modifying, and enforcing as modified, or setting aside in whole or in part the decision or order of the Public Employment Relations Board. The findings of the Public Employment Relations Board with respect to questions of fact, including ultimate facts, if supported by substantial evidence on the record considered as a whole, shall be conclusive. Title 1 (commencing with Section 1067) of Part 3 of the Code of Civil Procedure relating to writs shall, except where specifically superseded by this section, apply to proceedings pursuant to this section.
If the time to petition for extraordinary relief from a Public Employment Relations Board decision or order has expired, the Public Employment Relations Board may seek enforcement of any final decision or order in a district court of appeal or superior court having jurisdiction over the county where the events giving rise to the decision or order occurred. The Public Employment Relations Board shall respond within 10 days to any inquiry from a party to the action as to why the Public Employment Relations Board has not sought court enforcement of the final decision or order. If the response does not indicate that there has been compliance with the Public Employment Relations Board’s final decision or order, the Public Employment Relations Board shall seek enforcement of the final decision or order upon the request of the party. The Public Employment Relations Board shall file in the court the record of the proceeding, certified by that board, and appropriate evidence disclosing the failure to comply with the decision or order. If, after hearing, the court determines that the order was issued pursuant to the procedures established by the Public Employment Relations Board and that the person or entity refuses to comply with the order, the court shall enforce the order by writ of mandamus or other proper process. The court may not review the merits of the order.
This chapter, as amended by the act adding this section, shall not be interpreted as if it were in conflict with any collective bargaining agreement and shall not be implemented to abrogate an agreement entered into before January 1, 2021, between the district and an employee organization. This chapter shall be interpreted in a manner consistent with the Public Employment Relations Board’s interpretation of parallel provisions in other statutes it enforces.
Chapter 11.5 (commencing with Section 3555) of Division 4 of Title 1 of the Government Code applies to the district and its employees. Notwithstanding subparagraph (B) of paragraph (1) of subdivision (i) of Section 3558.8 of the Government Code, the district is a public employer for purposes of Chapter 11.5 (commencing with Section 3555) of Division 4 of Title 1 of the Government Code.
CHAPTER 5. Retirement System [28870. - 28913.]
ARTICLE 1. Establishment [28870. - 28875.]
The board may establish a retirement system for the officers and employees of the district and provide for the payment of annuities, pensions, retirement allowances, disability payments, and death benefits or any of them.
The district may maintain its own retirement fund or may provide for benefits to eligible officers and employees, or their beneficiaries, by means of group insurance or other insurance, or by such means as in the opinion of the board will satisfactorily provide an adequate and sure method of meeting the payments contemplated by the retirement system.
Before establishing any retirement system the board shall secure a report from a qualified actuary, which shall show the cost of the benefits provided by the system, and the prospective assets and liabilities of the system.
The board may adopt all ordinances and resolutions and perform all acts necessary or convenient to the initiation, maintenance, and administration of the retirement system.
Nothing in this chapter prevents the district from participating in and making all or part of its employees members of the State Employees’ Retirement System by contract entered into between the district and the board of administration of the system under the State Employees’ Retirement Law or from participating in the Federal Social Security Act pursuant to Chapter 8 (commencing at Section 13775) of Part 3 of Division 3 of Title 2 of the Government Code, and the district may perform all acts necessary or convenient for such participation.
The board may classify and determine the officers and employees who shall be included as members in the retirement system and may change the classification from time to time. Membership of all officers and employees so classified and included in the retirement system is compulsory.
ARTICLE 2. Benefits and Contributions [28890. - 28896.]
The board may prescribe the terms and conditions upon which the officers and employees of the district or their beneficiaries shall be entitled to benefits and the amounts thereof.
The retirement allowance may be predicated in part upon service rendered the district by a member prior to the establishment of the retirement system, which service is known as “prior service.”
The board shall provide that both the district and the members shall contribute to the retirement system. The rate of contribution by an officer or employee of the district becoming a member of the retirement system shall be so fixed as to provide, with accumulated interest and based on tables and assumptions adopted by the board, substantially one-half the value of any retirement allowance granted for service, exclusive of any credits allowed for prior service.
All members of the retirement system shall contribute in the manner and amount fixed by the board and such contributions may be collected by deducting the amounts thereof from the salary, wages, or compensation due such members.
Liabilities accruing under the retirement system because of benefits other than such as are the equivalent of contributions by the members, with accumulated interest, shall be met by contributions by the district. Prior service or other liabilities of the district may be met by annual appropriations instead of by appropriation for the total of the liabilities; but until the present value of regular contributions for current service, together with assets then available, equals the present value of all allowances and benefits granted or to be granted under the system, the appropriation for any one year when added to any unused balance of any previous appropriations for such purpose shall not be less than the amount disbursed during that year on account of prior service or other liabilities of the district.
If any member withdraws from the retirement system prior to retirement the total amount contributed by him with such interest as may be credited thereto shall be returned to him; provided, however, that the board may prescribe the terms and conditions upon which a member, whose district service is terminated except by death or retirement, may elect to leave his contributions and interest thereon in the retirement fund, and the terms and conditions upon which a retirement allowance may be made to him after such termination based upon his contributions prior to such termination.
All money received by any person as an annuity, pension, retirement allowance, disability payment, or death benefit from the retirement system, and all contributions and interest thereon returned to any member of the retirement system, whether in the actual possession of such person or deposited, loaned, or invested by him, is exempt from execution or any other process except to the extent permitted by Section 704.110 of the Code of Civil Procedure and is unassignable.
ARTICLE 3. Retirement Board [28910. - 28913.]
The board shall create a retirement board of not more than five members, at least two members of which shall be the elected representatives of the employees, to administer the retirement system, and shall define its powers and duties and the tenure of the members.
All members of the retirement board shall serve without pay.
The retirement board shall determine the eligibility of officers, employees, and their dependents to participation in the system and shall be the sole authority and judge under such ordinances as may be adopted by the board as to the conditions under which persons may be admitted to and continue to receive benefits of any sort under the retirement system, and may modify allowances for service and disability. The determination of the retirement board shall be final and conclusive and shall not be modified or set aside except for fraud or abuse of discretion.
If the district maintains its own retirement fund the retirement board shall have exclusive control of the administration, investment, and disbursement of such fund. Investment of the fund shall be subject to the terms, conditions, limitations, and restrictions imposed by the laws of this State upon savings banks in the making of investments by savings banks, and cash may be deposited in any licensed national bank or banks in this State or in any bank, banks, or corporations authorized or licensed to do a banking business and organized under the laws of this State.
CHAPTER 6. Powers and Functions of District [28950. - 29103.]
ARTICLE 1. Corporate Power [28950. - 28959.]
The district has perpetual succession and may adopt a seal and alter it at pleasure.
The district may sue and be sued, except as otherwise provided by law, in all actions and proceedings, in all courts and tribunals of competent jurisdiction.
The district may levy, and collect or cause to be collected, taxes for any lawful purpose, as provided in Chapter 7 of this part.
The district may exercise the right of eminent domain to take any property necessary or convenient to the exercise of the powers granted in this part. The district, in exercising such power, shall in addition to the damage for the taking, injury, or destruction of property, also pay the cost, exclusive of betterment and with credit for salvage value, of removal, reconstruction, or relocation of any structure, railways, mains, pipes, conduits, wires, cables or poles of any public utility which is required to be moved to a new location.
The Public Utilities Commission of the State shall have and exercise power and jurisdiction to fix just compensation to be paid for the taking of any property of a public utility in eminent domain proceedings brought by the district. The district may commence and maintain such eminent domain proceedings in the Public Utilities Commission or the superior court at its option.
The district is entitled to the benefit of any reservation or grant, in all cases, where any right has been reserved or granted to the State or any agency or political subdivision thereof or any public corporation to construct or maintain roads, highways or other crossings over any public or private lands.
The district may be merged into or consolidated with any other public agency which may be established by law upon such terms as the board of directors shall specify in a resolution to be submitted to the electors of the district for approval in the manner provided in Sections 29540 to 29545, inclusive, of this part insofar as possible. The resolution authorizing consolidation or merger shall not take effect unless and until a majority of the votes cast are in favor of the proposed merger or consolidation. In the event of merger or consolidation, the surviving entity or the consolidated entity shall succeed to all the powers, duties, purposes, responsibilities, liabilities, and jurisdiction now or hereafter vested by law in the district.
The board may authorize the temporary transfer of cash balances in any fund (except moneys in any fund which the district is required to set aside for the payment of bonds, notes or other evidence of indebtedness and the interest thereon) to any other fund; and the amount so transferred shall be repaid as soon as moneys are available in the fund to which such transfer has been made. Transfers of funds within, or revision of, a budget adopted by the district, whether before or after the incurring of a bonded indebtedness, may be made by appropriate act of the board at a regular or special meeting.
ARTICLE 2. Contracts [28970. - 28975.]
The district may make contracts and enter into stipulations of any nature whatsoever, either in connection with eminent domain proceedings or otherwise, including, without limiting the generality of the foregoing, contracts and stipulations to indemnify and save harmless, to employ labor, and to do all acts necessary and convenient for the full exercise of the powers granted in this part.
The district may contract with any department or agency of the United States of America or of the State of California or with any public or private corporation upon such terms and conditions as the directors find is for the best interests of the district.
The district may insure against any accident to or destruction of the system or any part thereof.
The district may insure against loss of revenues from any cause whatsoever.
The district may insure against public liability or property damage, or both. It may provide in the proceedings authorizing the issuance of any bonds for the carrying of such or any other insurance, in such amount and of such character as may be specified, and for the payment of the premiums thereon.
ARTICLE 4. Property [29010. - 29011.]
The district may take by grant, purchase, gift, devise, or lease, or condemn in proceedings under eminent domain, or otherwise acquire, and hold and enjoy, real and personal property of every kind within or without the district necessary to the full or convenient exercise of its powers. The board may lease, mortgage, sell, or otherwise dispose of any real or personal property within or without the district when in its judgment it is for the best interests of the district so to do.
For purposes of this article, the following definitions shall apply:
“BART TOD place type” means the place type described in Table 1 and Figure 1 of the BART Transit-Oriented Development Guidelines (2017), as updated by the district.
“Eligible TOD project” means a TOD project that meets all of the following requirements:
The parcel or parcels on which the TOD project would be located is an infill site, as defined in Section 21061.3 of the Public Resources Code.
The parcel or parcels on which the TOD project would be located was not acquired through eminent domain on or after July 1, 2018.
The parcel or parcels on which the TOD project would be located forms a contiguous area of at least 0.25 acres, has at least 75 percent of its area located within one-half mile of an existing or planned district station entrance, and is located within an area represented on the board.
The parcel or parcels on which the TOD project would be located is owned by the district.
For a TOD project relating to a district station that existed on July 1, 2018, the TOD zoning standards and Section 29010.7 shall apply only to a parcel that is owned by the district on that date.
For a TOD project relating to a planned district station, the district station has been approved by an ordinance or resolution adopted by the legislative body of the local jurisdiction with local land use zoning jurisdiction over the area in which the station is located.
“Floor area ratio” means the ratio of gross building area of the development, excluding structured parking areas, proposed for the project, divided by the total area of the parcel or parcels used by the project, where “gross building area” means the sum of all finished areas of all floors of a building included within the outside faces of its exterior walls.
“Local jurisdiction” means a city, including a charter city, a county, or a city and county.
“Planned district station” means a station that has completed the California Environmental Quality Act review and for which construction is more than 75 percent funded.
“Station entrance” means the entry point into an enclosed station structure, or, where that point is not clear or does not exist, the station fare gates.
“TOD” means transit-oriented development.
“TOD project” means any residential or commercial development project, comprised of one or more buildings, wholly or partially on district land with 50 percent of the floor area of the project dedicated to residential uses, unless a locally adopted specific plan provides for a different percentage, or other metric, of residential uses on district-owned parcels. If a locally adopted specific plan establishes a lower minimum residential use requirement for district-owned land, the specific plan metric shall serve as the minimum residential requirement.
“TOD project area” means the parcel or parcels of land on which a TOD project is situated.
This section shall remain in effect only until January 1, 2029, and as of that date is repealed.
The district may take by gift, or take or convey by grant, purchase, devise, or lease, and hold and enjoy, real and personal property of every kind within or without the district necessary for, incidental to, or convenient for, transit-oriented joint development projects that meet the definition and requirement set forth in subdivision (b).
For purposes of this section, a transit-oriented joint development project is a commercial, residential, or mixed-use development that is undertaken in connection with existing, planned, or proposed transit facilities and is located one-half mile or less from the external boundaries of that facility.
Any transit-oriented joint development project created under this section shall comply with the land use and zoning regulations of the city, county, or city and county in which the project is located.
Notwithstanding Section 29036 or any other provision of law, the authority granted under this section is subject to the land use and zoning regulations of the city, county, or city and county jurisdiction in which the transit-oriented joint development is located, in accordance with the Planning and Zoning Law (Title 7 (commencing with Section 65000) of the Government Code), relating to zoning.
Notwithstanding Sections 53091 and 53094 of the Government Code, nor any zoning override which may have been previously exercised pursuant thereto by a school district, whenever the district leases or has leased, mortgages or has mortgaged, sells or has sold, or otherwise disposes or has disposed of real property to the school district which was acquired from private owners, the city, whether general law or charter, in which such land is located, or county, in unincorporated areas, shall retain zoning and permit powers.
Notwithstanding any other law, the San Francisco Bay Area Rapid Transit District (BART) board of directors shall, consistent with Section 28793, adopt by ordinance TOD zoning standards for each station that establish minimum local zoning requirements for height, density, parking, and floor area ratio only, that apply to an eligible TOD project.
Adopted TOD zoning standards shall establish, for each district station, the lowest permissible limit for height, density, and floor area ratio, and the highest permissible parking minimums and maximums. The zoning standards published in Table 1 and Figure 1 of the BART TOD Guidelines (2017) shall serve as the minimum allowable density and height limits, and the highest allowable parking limits to which the board is required to adhere in adopting TOD zoning standards. The board shall not establish floor-area-ratio limits in the TOD zoning standards for each station type less than the number in the column titled “residential target height” multiplied by 0.6.
The TOD zoning standards adopted by the board for each station shall not assign a lowest permissible height limit taller than the larger of the following two heights:
The “highest approved height” as defined in subparagraph (A) of paragraph (1) of subdivision (a) of Section 29010.7.
One hundred fifty percent of the target height in the zoning standards published in Figure 1 of the BART TOD Guidelines (2017).
TOD zoning standards shall be adopted by July 1, 2020, and may be amended thereafter pursuant to this section.
If the board, for any reason, does not adopt new standards for a station by July 1, 2020, Table 1 of BART TOD Guidelines (2017) shall serve as the TOD zoning standards, with the Transit Oriented Place Types identified in Figure 1 of the BART TOD Guidelines (2017), until that time when the board adopts new TOD zoning standards for that station.
In the case that Table 1 of the BART TOD Guidelines (2017) serves as the TOD zoning standards for any stations, the minimum allowable floor-area-ratio limit shall be calculated for each station type by multiplying the number in the column titled “residential target height” by 0.6.
The district is not required to establish TOD zoning standards for a station where, according to the district’s assessment, it would be impractical to develop an eligible TOD project greater than one-half acre.
The TOD zoning standards adopted by the board for each station shall reflect the diversity of the different communities served by the district’s stations.
The adoption of, and amendments to, the TOD zoning standards shall comply with all of the following:
The district shall hold a public hearing to receive public comment on the proposed TOD zoning standards or proposed changes to the TOD zoning standards. The district shall conduct direct outreach to relevant local jurisdictions and to communities of concern around each station. Before or during the scoping meeting, the district shall meet with each jurisdiction in which the station is located, as well as any relevant infrastructure agencies. The consultation required pursuant to this section shall include all of the following:
A review of the housing needs of the jurisdiction.
A review of the TOD approved and built in the past year in the jurisdiction.
A review of any TOD projects proposed by the district in the jurisdiction for the past year.
A discussion of any obstacles to development of any project proposed by the district.
Not less than 30 days before a public hearing of the board to consider the TOD zoning standards, the district shall provide public notice and make the draft standards available to the public.
The board shall adopt or reject any proposed TOD zoning standards at a publicly noticed meeting of the board not less than 30 days following the original public hearing.
Before or at the same time as adopting the TOD zoning standards, the board shall approve travel demand management requirements for TOD projects on district-owned real property, which shall be consistent with district station access, district sustainability, and district TOD policy goals.
In cases where a local jurisdiction’s zoning for district-owned land within one-half mile of a district station, approved as of July 1, 2018, is within 10 percent of the height and floor-area-ratio standards established in Table 1 and Figure 1 of the BART TOD Guidelines (2017) and values calculated by clause (ii) of subparagraph (B) of paragraph (4) of subdivision (a) the local jurisdiction shall be exempt from the application of the TOD zoning standards for that station. In this case, the parking requirements shall be set as the parking minimum and maximum established in Table 1 and Figure 1 of the BART TOD Guidelines (2017).
The district’s approval of TOD zoning standards shall be subject to CEQA review. The district shall serve as the lead agency for CEQA review for the TOD zoning standards.
Any subsequent CEQA review of rezoning to conform with TOD zoning standards, and of eligible TOD projects proposed on district-owned land, shall incorporate the environmental review document certified for the TOD zoning standards consistent with Section 21094 of the Public Resources Code. A public agency shall not prepare an environmental impact report or mitigated negative declaration for rezoning pursuant to paragraph (2) of subdivision (d) to implement TOD zoning standards or for a TOD project subsequent to the district’s certification of an environmental review document for approval of TOD zoning standards unless the public agency finds, based on substantial evidence, that the rezoning or TOD project creates a significant effect on the environment that was not analyzed in the prior environmental review document, and mitigated or avoided.
In the event that the TOD zoning standards, objective planning standards, general plan, or design review standards are mutually inconsistent, the TOD zoning standards shall be the controlling standards. To the extent that the zoning standards do not resolve inconsistencies, the general plan shall be the controlling standard.
The district shall establish, and amend as necessary, a parking replacement policy, consistent with the district’s practice at auto-dependent stations and the district’s station access policy, with specific provisions to ensure that, after the construction of the eligible TOD project, auto-dependent stations are still accessible by private automobile. The policy shall specifically consider the parking replacement needs for auto-dependent end-of-the-line stations.
For any station where district commuter parking is reduced as a result of a TOD project on land where TOD zoning standards apply, the district shall develop and fund an access plan that maintains station access for at least the number of customers affected by the reduced number of commuter parking spaces, which shall include specific consideration for customers who live further than one-half mile from the station.
Local jurisdictions shall not do either of the following:
Require that parking, as part of an eligible TOD project, be associated with any specific use, residential unit, business, or portion of the TOD project.
Prohibit parking from being sold, rented, or otherwise assigned separately from other parts of the eligible TOD project.
Zoning in effect as a result of this section shall be considered the same as locally approved zoning for all purposes, including the density bonus law and the Housing Accountability Act.
This section shall remain in effect only until January 1, 2029, and as of that date is repealed.
This section shall only apply to an eligible TOD project that meets both of the following requirements:
Has a height less than or equal to one story, or 15 feet, above the highest approved height for mixed use or residential use within a half-mile of a district station parcel or entrance on July 1, 2018, where “highest approved height” means the tallest height, including heights that require conditional approval, allowable pursuant to zoning, including the municipal code and any specific or area plan that covers the district station property.
Has a floor area ratio equal to or less than 0.6 times the number of stories that satisfies subparagraph (A).
If local zoning standards allow for taller heights or larger floor area ratios than the requirements in paragraph (1), this section shall apply to any project that meets the requirements of the local zoning standards.
Subparagraph (A) shall not apply to local zoning standards adopted for the purpose of complying with paragraph (1) of subdivision (d) of Section 29010.6 or to BART TOD standards that have become the local zoning pursuant to paragraph (2) of subdivision (d) of Section 29010.6.
This section shall not apply to a project where the local jurisdiction finds that the project will cause a specific adverse impact to public health and safety as described in paragraph (2) of subdivision (d) of Section 65589.5 of the Government Code, and there is no feasible method to satisfactorily mitigate or avoid the adverse impact.
A developer in an exclusive negotiating agreement with the district may submit an application for a development that is subject to the streamlined, ministerial approval process not subject to a conditional use permit as specified in Section 65913.4 of the Government Code.
An eligible TOD project that meets the requirements in subdivision (a) shall not be required to comply with the objective planning standards in subdivision (a) of Section 65913.4 of the Government Code to be eligible for the streamlined, ministerial approval process, except as otherwise provided in this article.
A developer of an eligible TOD project may apply for density bonus pursuant to Section 65915 of the Government Code. For purposes of an application submitted pursuant to subdivision (b), “maximum allowable gross residential density,” as that term is used in Section 65915 of the Government Code, includes the highest approved height, as defined in subparagraph (A) of paragraph (1) of subdivision (a), and the floor area ratio requirement described in subparagraph (B) of paragraph (1) of subdivision (a). A project that meets the requirements of paragraph (1) of subdivision (a) before the addition of any height increases, density increases, waivers, or concessions awarded through a density bonus shall remain eligible for streamlining under this section after the addition of a density bonus.
This section shall remain in effect only until January 1, 2029, and as of that date is repealed.
The district shall do all of the following to avoid the loss of affordable housing units and to prevent the direct displacement of tenants:
Require that any eligible TOD project that involves the demolition of any of the following types of housing, within five years from the date of approval of the development agreement, shall be subject to a policy that requires the replacement of all of those housing units to the same or lower income levels:
Housing that is subject to a recorded covenant, ordinance, or law that restricts rents or sales prices to levels affordable, as defined in Section 50052.5 or 50053 of the Health and Safety Code, to persons and families of moderate, lower, or very low income, as defined in Section 50079.5, 50093, or 50105 of the Health and Safety Code, respectively.
Housing that is subject to any form of rent or price control through a public entity’s valid exercise of its police power.
Housing that had been occupied by tenants within five years from the date of approval of the development agreement by a primary tenant who was low income and did not leave voluntarily.
As a condition of any development on a parcel within an eligible TOD project area, replacement housing units for those described in paragraph (1) shall be subject to recorded affordability restrictions. In the case of the demolition of a rental unit, a replacement unit shall be a rental unit with restrictions for at least 55 years, with a rent level set at the same level as the previous restrictions or, if no rent restrictions were in place, at rent affordable, as defined in Section 50053 of the Health and Safety Code, to the tenant who most recently occupied the unit, or, if the income level of the most recent tenant cannot be determined, at rent affordable to lower income households, as defined in Section 50079.5 of the Health and Safety Code.
Prohibit the demolition of any unit occupied by lower income tenants unless the district or the TOD developer has offered, in writing, the tenant a commensurate or better replacement affordable housing unit that is available for occupancy by the displaced tenant within one-half mile of the same district station at a rent that does not exceed the tenant’s previous rent.
Require that new units shall not be occupied sooner than the date that replacement affordable housing units are available to all eligible tenants that wish to be moved into replacement units pursuant to paragraph (3).
Provide relocation assistance to lower income tenants directly displaced from housing units by an eligible TOD project pursuant to Chapter 16 (commencing with Section 7260) of Division 7 of Title 1 of the Government Code.
Develop a strategy, in coordination with local jurisdictions, to do both of the following:
Increase affordable housing options and incentivize tenant protections for very low and low-income residents within and around an eligible TOD project area, particularly in communities of concern, as defined in MTC’s regional transportation plan, where there is potential for residential displacement due to changing market and development conditions. The strategy should specifically address mitigations for the direct and indirect impacts from the demolition of any existing housing units.
Deliver housing for essential workers within and around TOD projects, especially for very low, low-, and moderate-income workers.
An eligible TOD project shall do both of the following:
Where housing is proposed, restrict at least 20 percent of the residential housing units for occupancy by very low and low-income households and subject to a recorded affordability restriction for at least 55 years in the case of rental units and 45 years in the case of owner-occupied units, in addition to the replacement affordable housing units described in paragraph (3) of subdivision (a), with a priority on residential units for very low and low-income households.
If a local jurisdiction’s inclusionary housing requirement mandates a higher percentage of affordable units or a deeper level of affordability than that described in subparagraph (A), then that jurisdiction’s affordability percentage requirements shall apply in place of the requirements in subparagraph (A).
The district shall develop and implement an approach to evaluating affordable housing proposals that will consider a proposal’s quantity and depth of affordability, and the proposal’s validity and feasibility with respect to the requirements of this section.
Comply with the labor requirements of Section 65913.4 of the Government Code and any other applicable district labor policies, including the district’s policy of requiring project stabilization agreements pursuant to district Resolution 5182 (November 17, 2011), In the Matter of a Policy Requiring Project Stabilization Agreements (PSA) with Local Hire Provisions on Transit-Oriented Development (TOD) Projects.
On district-owned land within the district’s boundaries, the district shall ensure that a total of 30 percent of housing units are affordable, with priority given to very low and low-income households. The district shall submit a biennial report to the Department of Housing and Community Development stating the percentage of units that are restricted as affordable units, by level of affordability, for all district TOD projects.
The district may exempt specific TOD projects from the application of TOD zoning standards when the project is in the approval process with a local jurisdiction before imposition of the TOD zoning standards adopted pursuant to subdivision (a) of Section 29010.6.
This section shall remain in effect only until January 1, 2029, and as of that date is repealed.
Notwithstanding Section 65913.4 of the Government Code, a local jurisdiction may exercise full design review and conditional use permitting authority over any eligible TOD project that does not meet the conditions specified in subdivision (a) of Section 29010.7, except as provided in subdivision (c) of Section 29010.7.
This section shall remain in effect only until January 1, 2029, and as of that date is repealed.
When the district enters into an exclusive negotiating agreement with a developer for the development of an eligible TOD project, that agreement shall confer a vested right to proceed with development in substantial compliance with the provisions of Sections 29010.6, 29010.7, 29010.8, and 29010.9. However, if Section 29010.6, 29010.7, 29010.8, or 29010.9 is repealed, that agreement shall confer a vested right to proceed with the eligible TOD project in substantial compliance with those provisions in effect at the time the agreement was entered into.
This section shall remain in effect only until January 1, 2031, and as of that date is repealed.
Before July 1, 2027, the district shall submit a report to the Legislature assessing whether the provisions of this chapter effectively accelerate, and improve the quality of, TOD at district stations.
The report shall include all of the following:
The average time to deliver TOD projects begun before January 1, 2019, and after January 1, 2019.
A summary of the data on travel behavior and choices for TOD residents and workers.
A summary of the housing affordability in district TOD projects begun after January 1, 2019.
A summary of which TOD projects were delivered pursuant to a streamlined approval process and delivered pursuant to a discretionary approval process.
A cost comparison of discretionary and ministerial TOD projects.
Other factors the district determines to be pertinent to the Legislature’s consideration of whether to extend the sunset dates applicable to this chapter.
This article shall not apply to a district station without unentitled or undeveloped land on July 1, 2018, unless that station entitlement expires. For this purpose, “undeveloped land” includes, but is not limited to, surface parking.
This article shall not preclude or limit the ability of a developer to seek, or the application of, a density bonus, including concessions and incentives from a local government pursuant to Section 65915 of the Government Code.
This section shall remain in effect only until January 1, 2029, and as of that date is repealed.
Whenever the board by resolution determines that any record, map, book, or paper in the possession of the district or any officer or employee thereof is of no further value to the district, the board may authorize its sale, destruction, or other disposition.
ARTICLE 5. Rapid Transit Facilities and Service [29030. - 29047.]
The district may provide a rapid transit system for the transportation of passengers and their incidental baggage.
The district may acquire, construct, own, operate, control, or use rights-of-way, rail lines, bus lines, stations, platforms, switches, yards, terminals, parking lots, and any and all other facilities necessary or convenient for rapid transit service within or partly without the district, underground, upon, or above the ground and under, upon, or over public streets, highways, bridges, or other public ways or waterways, together with all physical structures necessary or convenient for the access of persons and vehicles thereto, and may acquire any interest in or rights to the use or joint use of any or all of the foregoing; provided, that installations in state freeways shall be subject to the approval of the Department of Transportation and installations in other state highways shall be subject to Article 2 (commencing with Section 670), Chapter 3, Division 1 of the Streets and Highways Code.
The district may lease or contract for the use of its facilities, or any portion thereof, to any operator, and may provide for subleases by such operator upon such terms and conditions as it deems in the public interest. The word “operator” as used in this section means any city or public agency or any person, firm or private corporation.
The district may construct and operate or acquire and operate works and facilities in, under, upon, over, across, or along any street or public highway or any stream, bay or watercourse, or over any of the lands which are the property of the State, to the same extent that such rights and privileges appertaining thereto are granted to municipalities within the State.
The district may enter into agreements for the joint use of any property and rights by the district and any public agency or public utility operating transit facilities; may enter into agreements with any public agency or public utility operating any transit facilities, either wholly or partially within, or without, the district, for the joint use of any property of the district or of that public agency or public utility, or the establishment of through routes, joint fares, transfer of passengers or pooling arrangements.
The district may approve annexation of areas to the district pursuant to Chapter 9 (commencing with Section 29500) or other forms of affiliation; however, the district shall meet its service commitments within its boundaries as they existed on January 1, 1971, before the district may expend any district funds for the purpose of extending services and facilities outside of those boundaries, except for the extension of services and facilities south of the Daly City Station to the terminus of the BART-San Francisco Airport Extension.
This section does not preclude either of the following:
Rail line extensions to other areas that may be annexed to, or in some other way are affiliated with, the district, if other than district funds are used to finance the construction and operation of the extensions.
Improvements to existing district stations and yards.
As used in this section, “service commitments” means the extension of district services and facilities to the Cities of Antioch, Pittsburg, Pleasanton, Livermore, and Fremont and to the northwest section of the City and County of San Francisco.
Not later than 1991, the district shall proceed to commence construction of an extension of its facilities to West Pittsburg, or to a point east of that location, if the funding described in subdivision (b) is sufficient and all of the following occur:
The voters of Contra Costa County, at the November 8, 1988, general election, approve an additional one-half of 1 percent sales tax for transportation purposes.
An increase in San Francisco Bay area bridge tolls, as proposed by Senate Bill No. 45 of the 1987–88 Regular Session, is approved.
Sufficient funds are provided to the district from paragraphs (1) and (2) which, together with funds identified in subdivision (b), would result in the generation of at least four hundred twenty-five million dollars ($425,000,000) for the West Pittsburg BART extension.
The district board of directors shall set aside at least thirty-four million dollars ($34,000,000) from district reserve funds and, if the district receives two hundred million dollars ($200,000,000) from the San Mateo County Transit District as a result of an agreement between the district and the San Mateo County Transit District, the district board of directors shall set aside at least an additional seventy-four million dollars ($74,000,000) for the purposes of this section. The district shall seek other funding as may be available from state and other sources to meet the objective of completing construction of an extension to West Pittsburg.
It is the intent of the Legislature that the district extend its service and facilities to eastern Contra Costa County as far as the four hundred twenty-five million dollars ($425,000,000) funding amount will permit.
If funds generated from the additional Contra Costa County transportation sales tax or the increase in bridge tolls do not become available to the district, it is the intent of the Legislature that the district proceed with service and facilities extension as far as available funding sources permit.
Not later than December 31, 1991, the district shall proceed to commence construction of an extension of its facilities to Dublin if an agreement is then existing between the district and the Alameda County Transportation Commission to provide funding for that extension in accordance with the Alameda County Transportation Expenditure Plan adopted pursuant to Section 131055.
Not later than December 31, 1991, the district shall proceed to commence construction of an extension of its facilities to Warm Springs, subject to each of the following conditions:
The Dublin extension is fully funded and ready for implementation.
Appropriate federal and environmental approvals are obtained in a timely manner.
Adequate funding is available from the sources described in subdivision (c).
In order to meet the objective of completing construction of the Dublin and Warm Springs extensions of the district’s facilities, as contemplated by the Alameda County Transportation Expenditure Plan, the board of directors of the district shall take the following actions:
It is the intent of the Legislature, if funding, as provided for in the Alameda County Transportation Expenditure Plan and pursuant to paragraphs (2) and (3) of subdivision (c), does not become available to the district for the full extension of service and facilities described in subdivisions (a) and (b), that the district nevertheless undertake to provide the described extensions to the extent that available funding permits.
The district may operate such feeder bus lines and other feeder services as necessary.
Metropolitan Transportation Commission Resolution 3434, in December 2001, established the following Regional Transit Expansion Program for the San Francisco Bay area:
BART to Warm Springs, sponsored by the Bay Area Rapid Transit District.
BART from Warm Springs to Milpitas, San Jose, and Santa Clara, sponsored by the Santa Clara Valley Transportation Authority.
San Francisco Muni Third Street Light-Rail Transit Project: Phase 2-New Central Subway, sponsored by the San Francisco County Transportation Authority and San Francisco Muni.
BART/Oakland Airport Connector, sponsored by the Bay Area Rapid Transit District.
Caltrain Downtown Extension/Rebuilt Transbay Terminal, sponsored by the San Francisco County Transportation Authority.
Caltrain Rapid Rail/Electrification, sponsored by the Joint Powers Board (Caltrain).
Caltrain Express/Phase 1, sponsored by the Joint Powers Board (Caltrain).
Downtown to East Valley Light-Rail and Bus Rapid Transit: Phases 1 and 2, sponsored by the Santa Clara Valley Transportation Authority.
Capitol Corridor: Phase 1 Expansion, sponsored by the Capitol Corridor Joint Powers Authority.
AC Transit Oakland/San Leandro Bus Rapid Transit: Phase 1 (Enhanced Bus), sponsored by AC Transit.
Regional Express Bus: Phase 1, sponsored by the Metropolitan Transportation Commission.
Dumbarton Rail, sponsored by the Joint Powers Board (Caltrain).
BART/East Contra Costa Rail Extension, sponsored by the Contra Costa Transportation Authority and BART.
BART/Tri-Valley Rail Extension, sponsored by the Alameda County Transportation Commission and BART.
Altamont Commuter Express (ACE): Service Expansion, sponsored by the Altamont Commuter Express.
Caltrain Express: Phase 2, sponsored by the Joint Powers Board (Caltrain).
Capitol Corridor: Phase 2 Enhancements, sponsored by the Capitol Corridor Joint Powers Authority.
Sonoma-Marin Rail, sponsored by Sonoma-Marin Area Rail Transit.
AC Transit Enhanced Bus: Hesperian/Foothill/MacArthur Corridors, sponsored by AC Transit.
The board of directors shall refer for recommendation the plans of routes, rights of way, terminals, stations, yards and related facilities and improvements to the city councils and boards of supervisors within whose jurisdiction said facilities and improvements lie and to such other state, regional and local agencies and commissions as may be deemed appropriate by the board of directors. The board of directors shall give due consideration to all recommendations submitted.
The district shall not interfere with or exercise any control over any transit facilities now or hereafter owned and operated wholly or partly within the district by any city or public agency, unless by consent of such city or public agency and upon such terms as are mutually agreed upon between the board and such city or public agency.
The rates and charges for service furnished pursuant to this part shall be fixed by a two-thirds vote of the board and shall be reasonable. Insofar as practicable, the rates shall be fixed so as to result in revenue which will be sufficient to do all of the following:
Pay the operating expenses of the district.
Provide for repairs, maintenance, and depreciation of works owned or operated by the district.
Provide for the purchase, lease, or acquisition of rolling stock, including provisions for interest, sinking funds, reserve funds, or other funds required for the payment of any obligations incurred by the district for the acquisition of rolling stock.
After making any current allocation of funds required for the foregoing purposes and by the terms of any indebtedness incurred under Articles 6 (commencing with Section 29240) and 7 (commencing with Section 29250) of Chapter 8, provide funds for any purpose the board deems necessary and desirable to carry out the purposes of this part.
The board of supervisors of a county or a city and county, or the city council of a municipality having territory located within the district may file a request for a hearing before the district board as to the reasonableness of any rates or charges fixed by the district and as to any proposal for fixing the location of facilities by the district. The request shall be in writing and shall state the subject matter on which a hearing is desired.
Upon the filing of a request for hearing as provided in Section 29039 the district board shall fix the time and place for hearing. The time fixed shall not be less than fifteen (15) days nor more than sixty (60) days from the date such request is filed. Notice of such hearing shall be given to the county or city requesting such hearing and shall be published by the board.
At the time fixed for any hearing before the board any board of supervisors or city council eligible to file a request for hearing, not a party to the original request for hearing, may intervene and shall be entitled to be heard and to introduce evidence.
The district, petitioner or petitioners, and the intervenors shall have the right to call and examine witnesses; to introduce exhibits; to cross-examine opposing witnesses on any matter relevant to the issues even though that matter was not covered in direct examination; and to rebut evidence introduced by other parties.
Oral evidence shall be taken only on oath or affirmation. The hearing need not be conducted according to technical rules relating to evidence and witnesses. Any relevant evidence shall be admitted if it is the sort of evidence on which responsible persons are accustomed to rely in the conduct of serious business affairs, regardless of the existence of any common law or statutory rule which might make improper the admission of such evidence over objection in a civil action. Hearsay evidence may be used for the purpose of supplementing or explaining any direct evidence but shall not be sufficient in itself to support a finding unless it would be admissible over objection in a civil action.
A complete record of all proceedings and testimony before the board at such hearing shall be taken down by a reporter appointed by the board. In case an action is brought to review any decision of the board, a transcript of such testimony, together with all exhibits or copies thereof introduced, together with the written request for hearing and other proceedings in the cause shall constitute the record on review; provided, however, that the board and other parties may stipulate in writing that a specified portion of the evidence be certified to the court for judgment and in such case the portion of the evidence specified and the stipulation specifying such evidence shall be the record on review.
Within thirty (30) days after submission of the case the board shall render its decision in writing together with written findings of fact. Copies of the findings and decision shall be sent forthwith to the petitioners and intervenors by registered mail, postage prepaid.
Within forty (40) days after the mailing of the decision to the petitioner, the petitioner may apply for a writ of mandate in the manner provided in the Code of Civil Procedure. The complete record of the proceedings, or such parts thereof as are designated by the petitioner, shall be prepared by the district and shall be delivered to the petitioner within thirty (30) days after a request therefor, upon payment of the expense of preparation and certification thereof.
The district shall be subject to regulations of the Public Utilities Commission relating to safety appliances and procedures, and the commission shall inspect all work done pursuant to this part and may make such further additions or changes necessary for the purpose of safety to employees and the general public.
The commission shall enforce the provisions of this section.
The district shall reimburse the commission for any cost incurred by the commission in regulating pursuant to this section when such regulating is performed (a) by persons not on the staff of the commission or (b) by the staff of the commission but not funded by a Budget Act appropriation. The reimbursement shall be in the amount as agreed upon by the district and the commission and approved by the Director of Finance. If the district and the commission are unable to agree as to the amount of the cost, the Director of Finance shall determine the amount.
ARTICLE 6. Claims [29060. - 29060.]
ARTICLE 7. Indebtedness [29080. - 29081.]
The district may accept, subject to the procedures and limitations provided in Chapter 8 of this part, contributions or loans from the United States, or any department, instrumentality, or agency thereof, for the purpose of financing the acquisition, construction, maintenance, and operation of transit facilities, and may enter into contracts and cooperate with, and accept cooperation from, the United States, or any department, instrumentality, or agency thereof, in the acquisition, construction, maintenance, and operation, of any such transit facilities in accordance with any legislation which Congress may have heretofore adopted or may hereafter adopt, under which aid, assistance, and cooperation may be furnished by the United States in the acquisition, construction, maintenance, and operation or in financing the acquisition, construction, maintenance, and operation of any such transit facilities. The district may do any and all things necessary in order to avail itself of such aid, assistance, and cooperation under any federal legislation now or hereafter enacted. Any evidence of indebtedness issued under this section shall constitute a negotiable instrument.
The district may cooperate with and enter into agreements with the State of California or any public agency for the acquisition, construction, completion, maintenance, operation, or repair, joint or otherwise, and in whole or in part, of transit facilities. In connection with any such cooperation or contract, the State or any public agency may make public contributions to the district as in the judgment of the Legislature, or the governing board of the agency, are necessary or proper for its undertaking, and the district may reimburse the State or public agency for any such advance or contribution from the proceeds of the sale of bonds or any other funds available to the district, except that any agreement requiring reimbursement of contributions or advances by obligating the district to incur an indebtedness will be subject to the procedures and limitations provided in Chapter 8 of this part. The State or any public agency may also authorize, aid and assist the district to carry out any activity which the State or public agency is by law authorized to perform and carry out on its own behalf.
ARTICLE 8. Investments [29100. - 29103.]
Subject to any agreement or covenant between the district and the holders of any of its obligations limiting or restricting classes of investments, the district may invest any surplus money in its treasury, including money in any sinking fund, reserve fund, or other fund created or established for the benefit of holders of any outstanding obligations of the district, in any of the following:
Its own bonds.
Treasury notes, certificates of indebtedness, bills, bonds of the United States, or any other evidence of indebtedness secured by the full faith and credit of the United States.
Obligations issued pursuant to the Federal Home Loan Bank Act or the National Housing Act.
Treasury notes or bonds of this State, or of any public corporation, municipal corporation, public district, or political subdivision within this State which are legal as security for the deposit of public funds.
In any investment in which county funds may be placed pursuant to the general laws of the State of California.
Such investment may be made by direct purchase of any issue of such bonds, treasury notes, or obligations, or part thereof, at the original sale or by the subsequent purchase of the bonds, treasury notes, or obligations.
Any bonds, treasury notes, or obligations purchased and held as investments by the district may from time to time be sold and the proceeds reinvested in bonds, treasury notes, or obligations as provided in this article.
Sales of any bonds, treasury notes, or obligations purchased and held by the district shall from time to time be made in season so that the proceeds may be applied to the purposes for which the money with which the bonds, treasury notes, or obligations were originally purchased was placed in the treasury of the district.
CHAPTER 7. Taxation [29120. - 29143.]
ARTICLE 1. Property Taxation [29120. - 29131.]
The board may provide for the assessment, levy, and collection of taxes by the district, including the sale of property to the district for delinquent taxes, with penalties, interest, and cost.
The board shall, at the time of fixing the general tax levy and in the manner provided for the general tax levy, levy and collect annually until the general obligation bonds of the district are paid, or until there is a sum in the treasury of the district set apart for that purpose to meet all sums coming due for principal and interest on the bonds as they become due and payable, a tax sufficient to pay the annual interest on the bonds and such part of the principal thereof, including any sinking fund installments required by any of the district’s agreements with its bondholders, as becomes due before the proceeds of a tax levied at the next general tax levy will be available for such purposes.
The taxes required to be levied and collected on account of interest, principal, and sinking fund of general obligation bonds of the district shall be in addition to all other taxes levied for district purposes, and shall be collected at the time and in the same manner as other district taxes are collected, and be used for no other purpose than the payment of the bonds and accruing interest.
The tax rate for taxes levied in any fiscal year for all district purposes other than taxes levied pursuant to Section 29121, shall not exceed five cents ($0.05) on each one hundred dollars ($100) of assessed valuation of taxable property within the district, except the tax rate for the first year of levy may include an additional amount sufficient to repay temporary borrowing incurred pursuant to Article 5 of Chapter 8 of this part. Taxes levied pursuant to this section for maintenance and operation of rapid transit facilities shall be supplementary to the revenues derived from such facilities and shall be limited to actual requirements.
All assessments shall be made for the district by the State Board of Equalization and the county assessors, and all taxes shall be collected for the district by the tax collectors, of the counties in which the district is situated.
Each county auditor shall, on or before the third Monday in August of each year, transmit to the board a statement in writing showing the total value of all property within the district as equalized.
The board shall, on or before the first weekday in September, or if such weekday falls upon a holiday then on the first business day thereafter, fix the rate of taxes, designating the number of cents upon each hundred dollars, using as a basis the value of property transmitted to the board by the county auditors, which rate of taxation shall be sufficient to raise the amount previously fixed by the board. These acts by the board shall constitute a valid assessment of the property and a valid levy of the taxes so fixed.
If in the determination of any tax rate a fraction of a cent occurs, the board may adopt a rate ending in the next higher tenth of one cent ($0.001). An excess over the amount specified in the budget, arising from the use of the tenth of one cent tax rate, is not a violation of this chapter. Any cash collected resulting from such excess or from an excess resulting from any other cause shall not invalidate the levies but shall be applied in the next succeeding budget year as available surplus unless its expenditure is otherwise authorized by law.
The board shall immediately after fixing the rate of taxes as above provided transmit to the county auditors of the counties in which the district is situated a statement of the rate of taxes fixed by the board.
The district’s taxes levied pursuant to this article shall be collected at the same time and in the same manner as county taxes. When collected, the net amount, ascertained as provided in this article, shall be paid to the chief financial officer of the district, under the general requirements and penalties provided by law for the settlement of other taxes. The district may adopt the alternative procedure of tax collection and apportionment established by Chapter 3 (commencing at Section 4701) of Part 8 of Division 1 of the Revenue and Taxation Code and any amendments to that chapter. If the district adopts that alternative procedure, the district may thereafter abandon the alternative procedure at the end of any fiscal year of the district.
Whenever any real property situate in any district which has availed itself of the provisions of Section 29124 has been sold for taxes and has been redeemed, the money paid for redemption shall be apportioned and paid to the district by the county treasurers receiving it in the proportion which the tax due to the district bears to the total tax for which the property was sold.
The compensation to be charged by and paid to any county for the performance of services under this chapter shall be fixed by agreement between the board of supervisors of the county and the board. The compensation shall in no event exceed one-half of 1 percent of all money collected for the district. The compensation collected by the county shall be placed to the credit of the county salary fund.
All taxes levied under this part are a lien on the property on which they are levied. Unless the board has by ordinance otherwise provided, the enforcement of the collection of such taxes shall be in the same manner and by the same means provided by law for the enforcement of liens for county taxes, all the provisions of law relating to the enforcement of the latter being made applicable to this part, so far as consistent therewith.
ARTICLE 2. Retail Transactions and Use Tax [29140. - 29143.]
Notwithstanding Section 7251.1 of the Revenue and Taxation Code, a transactions and use tax rate imposed pursuant to subdivision (a) on or before January 1, 2020, that applies within the County of Alameda shall not be considered for purposes of the combined rate limit within the County of Alameda established by that section.
Notwithstanding Section 7251.1 of the Revenue and Taxation Code, a transactions and use tax rate imposed pursuant to subdivision (a) on or before the effective date of the act adding this subdivision that applies within the County of Contra Costa shall not be considered for purposes of the combined rate limit within the County of Contra Costa established by that section.
Any transactions and use taxes ordinance adopted pursuant to this article shall be operative on the first day of the first calendar quarter commencing more than 90 days after the effective date of this article, or January 1, 1970, whichever is later.
Prior to the operative date of the ordinance, the district shall contract with the State Board of Equalization to perform all functions incident to the administration and operation of the ordinance.
If the district shall not have contracted with the State Board of Equalization prior to the operative date of its ordinance, it shall nevertheless so contract and in such case the operative date shall be the first day of the first calendar quarter following the execution of the contract.
The contract entered into by the district with the State Board of Equalization prior to January 1, 1978, for the administration and operation of the transactions and use tax ordinance shall be amended to provide for the allocation of the transactions and use tax revenues pursuant to Section 29142.2.
Revenues derived from the transactions and use taxes, not to exceed an aggregate principal amount of one hundred fifty million dollars ($150,000,000), plus the costs payable by the district to the State Board of Equalization for preparatory costs and for its services in connection with such taxes and plus the costs of issuance of, and interest payments on, bonds or notes secured by such revenues, shall be used for the planning, acquiring, and constructing of the district’s approximately 75-mile system, including the San Francisco-Oakland Rapid Transit Tube and any and all works, structures, property, rolling stock, or other facilities of any kind which the district is authorized to acquire, construct, or complete.
Revenues in excess of the amount specified in subdivision (a) shall be used for purposes specified in Section 29142.2, operational purposes, the liquidation of operational deficits, and the payment of principal and interest on negotiable bonds issued pursuant to subdivision (c).
To finance the operation of its rapid transit system during the 1974–75 fiscal year, the district may issue negotiable bonds in an amount not to exceed sixteen million dollars ($16,000,000) in anticipation of the revenues specified in subdivision (b). However, upon a determination by the board that the issuance of sixteen million dollars ($16,000,000) in negotiable bonds, together with other funds available to the district, provide insufficient funds for the operation of the district during the 1975–76 fiscal year, the district may issue additional negotiable bonds in an amount not exceeding eight million dollars ($8,000,000). The district may also issue additional negotiable bonds in an amount not exceeding one million three hundred thousand dollars ($1,300,000) if the board determines that otherwise insufficient funds are available to the district for its operation during the 1976–77 fiscal year. The district shall pay the principal and interest on such bonds only from such revenues. Interest on such bonds may be funded, and paid from the proceeds of such bonds, for period of not to exceed two years from the date of such bonds. The board, by resolution shall determine the form, denomination, maturities, interest rates, and all other terms and conditions relative to the issuance of such negotiable bonds.
Notwithstanding Section 7271 of the Revenue and Taxation Code, after deduction for the cost of the State Board of Equalization in administering the transactions and use tax, the amounts collected under the ordinance adopted pursuant to Section 29140 and available for distribution shall be allocated as follows:
Seventy-five percent to the San Francisco Bay Area Rapid Transit District.
Twenty-five percent shall be allocated by the Metropolitan Transportation Commission to the San Francisco Bay Area Rapid Transit District, the City and County of San Francisco for its municipal railway system, and the Alameda-Contra Costa Transit District for transit services on the basis of regional priorities established by the commission. The allocations by the commission to these transit operators for transit services shall be in accordance with the criteria in the financial management plan which is to be developed and annually revised by the commission in coordination with the Alameda-Contra Costa Transit District, the San Francisco Bay Area Rapid Transit District, and the City and County of San Francisco.
No funds shall be allocated to an entity pursuant to Section 29142.2, after January 1, 1978, unless, as determined by the Metropolitan Transportation Commission, the transit operator:
Is a participating member of a regional transit coordinating council which the commission shall establish to better coordinate routes, schedules, fares, and transfers among the San Francisco Bay area transit operators and to explore potential advantages of joint ventures in areas such as marketing, maintenance, and purchasing. The commission shall be a member of the council.
Establishes, for the period for which the funds are allocated, fare levels such that fare revenues equal at least 33 percent of its operating cost, which shall be all of its costs in the expense object classes, exclusive of the costs of the depreciation and amortization expense object classes, of the uniform system of accounts and records adopted by the State Controller pursuant to Section 99243. The allocation period shall not be less than one calendar quarter nor longer than one fiscal year, as determined by the commission. For purposes of this subdivision, the two special transit service districts of the Alameda-Contra Costa Transit District shall be considered separate transit districts. On and after July 1, 1981, the commission may grant, any operator which was in compliance with the 33 percent requirement prior to that date, a credit not to exceed 5 percent to meet that requirement on the basis of special operating characteristics of its transit system, including, but not limited to, its transfer and special fare policies. In no event shall the combined fare revenues of the three operators, excluding any credit granted by the commission, be less than 33 percent of their combined operating cost.
Has complied with standards established by the commission pursuant to Section 66517.5 of the Government Code.
On and after July 1, 1984, for purposes of meeting the requirement of subdivision (b) of Section 29142.4, the Metropolitan Transportation Commission may consider, as fare revenues, that portion of the local support of an operator for its transit system which exceeds its base level of operating support as determined by the commission, if the commission finds that this consideration will enable the operator to maintain or improve vital transit within a coordinated fare structure.
Upon determination by the Metropolitan Transportation Commission that an operator has met the conditions specified in Section 29142.4, the commission shall notify the State Board of Equalization of the percentage of the transaction and use taxes to be allocated to the operator. Upon such notification, the State Board of Equalization shall transmit to the operator, as promptly as feasible, its share of the transaction and use taxes.
Any portion of the transactions and use tax revenues available for allocation and not allocated by the Metropolitan Transportation Commission shall be invested through the Surplus Money Investment Fund. The amount invested and the accrued interest therefrom shall be available for allocation by the commission.
Any funds which accumulated during a period an operator is not in compliance with Section 29142.4 may be allocated to any operator in compliance with that section at the time of allocation.
The district is hereby authorized to issue revenue bonds, payable, in whole or in part, from revenues made available under this article. Those revenues are deemed to be revenues of the enterprise for all purposes of the Revenue Bond Law of 1941 (Chapter 6 (commencing with Section 54300) of Part 1 of Division 2 of Title 5 of the Government Code), and the restrictions therein provided against the securing of bonds by the taxing power or the proceeds of taxation do not apply. The district is deemed a “local agency” and the planning, acquiring, constructing, operating or maintaining of the district’s rapid transit facilities, or any part thereof, is deemed an “enterprise,” within the meaning of the Revenue Bond Law of 1941. The provisions of that law not inconsistent with any of the provisions of this article are made applicable to the district, except that no election shall be required for the issuance of revenue bonds authorized by the board pursuant to this article and secured, in whole or in part, by the revenues made available under this article. Notwithstanding any provision of the Revenue Bond Law of 1941, the resolution or indenture authorizing the issuance of any revenue bonds secured, in whole or in part, by those revenues shall provide that the use of the revenues by the district to redeem bonds shall be continued in effect until the bonds are fully paid or provision has been made for their payment in full.
The district may borrow money in anticipation of the revenues made available under this article and may, from time to time, issue negotiable notes for that purpose.
In addition to pledging revenues for the payment of any revenue bonds, the district may pledge for the payment of the bonds all other income or receipts of the district which are not required by law to be used for other purposes.
CHAPTER 8. Bonds and Other Evidences of Indebtedness [29150. - 29293.]
ARTICLE 1. Authorization of General Obligation Bonds [29150. - 29168.]
The district may borrow money, incur a bonded indebtedness in respect thereto, and levy taxes for the payment of principal and interest thereon, in the manner provided in Chapter 7 of this part, but no such bonded debt shall exceed fifteen (15) percent of the assessed valuation of taxable property within the district.
Before submitting a proposal to incur any bonded indebtedness, the district shall employ such engineers, economists, fiscal experts and others as is necessary to develop general plans, estimates and general specifications pertaining to the projects for which the bond issue is proposed, sufficient in the opinion of the board to enable the board to determine the feasibility of such projects, provided that no such reports or the approval thereof specified in Section 29156 of this code shall be applicable to any proposal for the issuance of additional bonds to complete the project referred to in the original reports.
Such engineers, economists, fiscal experts and others shall make reports to the district, which shall include:
A general description of the facilities to be acquired or constructed from the proceeds of the proposed bond issue.
The estimated total cost of constructing or acquiring, or both, such facilities.
The estimated period of construction of such facilities.
An estimate of the revenues which may be expected to be derived therefrom.
The amount of bonds which will be required to pay the estimated total cost of constructing or acquiring such facilities. If the district determines to make interest payments out of bond proceeds, the estimate may include a sum sufficient to pay interest on the bonds during the estimated period of construction and for three years, or less, thereafter.
An estimate of the taxes required to be levied for all district purposes, the sources from which such taxes shall be obtained, and the proportion or amount to be derived from each source.
After receiving such reports, the board shall determine and declare by resolution whether or not the proposed plan of work is feasible and whether or not the project, as set forth in said reports, is necessary, and if so, shall make an order determining the amount of bonds that should be issued in order to raise the amount of money necessary therefor, and in determining such amount, sufficient shall be included to cover the cost of inspection of works in course of construction. Such determination by the board shall constitute a conclusive determination that the reports then on file with the board are adequate and sufficient to enable the board to make the determination as set forth in such resolution.
After adoption by the board of the reports made pursuant to Section 29152 the board shall refer such reports to the boards of supervisors of the counties comprising the district for their approval.
After receiving the reports, each board of supervisors shall fix a time and place for a public hearing to consider the reports. The time fixed for the hearing shall not be less than 30 days nor more than 60 days from the date the reports were received from the board.
Within 15 days from the date of the public hearing held pursuant to Section 29155, each board of supervisors shall, by a resolution adopted by a majority vote of the board of supervisors, determine whether it approves the reports and shall file an executed copy of the resolution with the secretary of the district.
If a majority of any board of supervisors does not approve the reports, the district may make additional studies and changes and may refer the amended reports to the board of supervisors of the counties comprising the district in order to obtain unanimous approval from the counties comprising the district. If no agreement is reached within a period of six months following the date the original reports were received from the board, any county not approving the reports may withdraw from the district under Chapter 10 (commencing with Section 29650), notwithstanding that, after that county’s disapproval, the reports are withdrawn by the district. Failure of a county to withdraw from the district, within 30 days following the six-month period, has the same effect as approval by the board of supervisors of the county of the reports as last amended, unless the reports have been previously withdrawn by the district.
Whenever it appears to the board that bonded indebtedness heretofore authorized pursuant to the provisions of this article is insufficient to cover all costs of the acquisition and construction of facilities, the board shall make an order determining the amount of bonds that should be issued in order to raise the additional funds necessary for the completion of such facilities. The provisions of Sections 29154, 29155, 29156 and 29157 of this code shall not be applicable to any election to authorize the issuance of additional bonds, after the district shall have issued all or any part of its first authorized issue of bonds.
When the district has received unanimous approval from the boards of supervisors of the counties comprising the district pursuant to Section 29156 of this code, or when the board has made its order pursuant to Section 29157.1 of this code, the board shall call a special election and submit to the qualified voters of the district the proposition of incurring such bonded indebtedness for the acquisition, construction or completion of rapid transit facilities by the district and all other works, property, or structures necessary or convenient therefor and for the purpose of carrying out the provisions of this part.
The resolution calling the special election shall contain:
A statement of the general object and purpose of incurring the indebtedness.
Statement of the estimated cost of the proposed work and improvements.
The amount of the principal of the indebtedness to be incurred therefor.
The maximum term, which shall not exceed fifty (50) years, that the bonds proposed to be issued shall run before maturity.
The maximum rate of interest to be paid on said indebtedness, which shall not exceed six (6) percent per annum.
A statement declaring whether interest, to be paid upon such bonds during the estimated period of construction of the works of the district and for three years thereafter, or less, shall be a capital charge, and shall be payable out of the principal sum realized from the sale of bonds, and, if so, to what extent.
An estimate of the taxes required to be levied for all district purposes, the sources from which such taxes shall be obtained, and the proportion or amount to be derived from each source.
The date on which the special bond election will be held, the hours during the day which the polls will be open, and the manner of voting for and against the incurring of such indebtedness; provided, however, the district shall have no power or authority, within six (6) months after an election at which a proposition submitted to the qualified electors of the district failed to receive the requisite number of votes as provided in Section 29168, to call or order another election for incurring any indebtedness for purposes substantially the same as voted upon at such prior election. If the special bond election is consolidated with any other election, the hours during which the polls shall be kept open in each county shall be the same as those provided for the election with which the election called pursuant to this part is consolidated and reference to that effect in the resolution shall be sufficient without specifying the particular hours.
The provisions of Section 37.5 of Chapter 1239 of the Statutes of 1949, the San Francisco Bay Area Metropolitan Rapid Transit District Act, relating to the repayment of appropriations made to the San Francisco Bay Area Rapid Transit Commission from the proceeds of the first sale of bonds issued by the district created by that act, shall apply to and be binding upon the San Francisco Bay Area Rapid Transit District.
Any election submitting the proposition of incurring indebtedness and the issuance of bonds called pursuant to this part, may be held separately, or may be consolidated with any other election authorized by law, at which the qualified voters of any county, city and county, or city are entitled to vote. However, in the event an election called pursuant to this part is consolidated with any other election, as provided by Part 3 (commencing with Section 10400) of Division 10 of the Elections Code, the provisions of this part setting forth the procedure for the calling of the election called pursuant to this part shall be complied with, except that the resolution calling the election need not set forth the election precincts or polling places, or the officers of election, which shall be the same as those set forth in the ordinance, order, resolution, notice, or other proceeding calling or providing for, or listing or designating the precincts, polling places, and election officers for the election with which the election called pursuant to this part is consolidated, and shall refer to the election or to the ordinance, order, resolution, notice, or other proceeding calling, providing for, or giving notice of the election, and which sets forth the precincts, polling places, and election officers. This reference may be made by giving the number or title or date of adoption of the ordinance, resolution, or order or to the date or proposed date of any publication of the notice and the name of the newspaper or proposed newspaper in which the notice has been or will be published or by any other definite description. Whenever a bond election called pursuant to this part is consolidated with a statewide general election held in the district, references to that general election shall be sufficient for all purposes of this part.
Whenever a special bond election is called pursuant to this part and is not consolidated with any other election the board shall in its resolution calling such special bond election, in addition to all other matters required to be set forth therein:
Specify the precincts or consolidated precincts in each county or portion of a county which are adopted for the purposes of the election and designate the location of the polling places, provided that one or more polling places may be established within the same precinct and separate ballot boxes and separate officers of election provided for each group of electors, which group shall be determined by alphabetical designations and divided into groups as nearly equal in number as practicable.
Specify the names of the officers selected to conduct the election, who shall consist of at least one inspector and two judges in each precinct, but not in excess of six election officers for each polling place.
Whenever the special bond election called pursuant to this part is consolidated in whole or in part with any other election, the precincts, polling places and election officers need not be set forth in the resolution calling the special bond election except only to the extent that any precinct, polling place and election officers established for the special bond election differ or are in addition to those established for the election with which the special bond election called pursuant to this part is consolidated.
Notice of a special bond election shall be given by publication of the text of the resolution calling the election and except as provided below the text thereof shall be published once a week in each calendar week for two successive calendar weeks at any time prior to the election (the first publication of which shall be not less than twenty (20) days nor more than ninety (90) days prior to the date fixed for the election) in at least one newspaper of general circulation and in not more than three newspapers, designated by the board, which are printed and published in each county within the district. That portion of the resolution constituting notice of election as published in each county shall contain only the reference to the precincts, polling places, and election officers in the county or portion of the county in which it is published, and it shall not be necessary to publish any portion of the resolution setting forth the precincts, polling places or election officers in any other county. Except for the omission in any county of the reference to the precinct, polling place and election officers in any other county, the text of the resolution as published in each county to constitute notice of said election shall be the resolution in form as adopted by the board. To each resolution published in each county there shall be set forth a notice substantially as follows:”Notice of Election
Notice is hereby given to the qualified electors of the San Francisco Bay Area Rapid Transit District that the Board of Directors has duly adopted a resolution calling a special bond election within the District which is set forth in full below, except only for the omission of the designation of the precinct, polling place and officers of election in any county or portion of a county in which such election is to be held except only the designation of such election details as the same pertain to the county or portion of a county in which the attached resolution is published, which election details are set forth in the following text of the resolution.”
If there is no newspaper published in any county within the district, the notice shall be posted in three public places in such county.
All the expenses of holding the election shall be borne by the district, except when the election is consolidated with another election pursuant to Part 3 (commencing with Section 10400) of Division 10 of the Elections Code, in which case the expense borne by the district shall be that agreed upon by the district and the other governing body or bodies calling the election.
No error, irregularity or omission in the calling, holding or conducting of any special bond election which does not affect the substantial rights of the taxpayers within the district or the electors voting at any election at which bonds of the district are authorized to be issued shall invalidate the election or any bonds authorized thereat.
The returns of the election shall be made and the votes shall be canvassed by the county elections official in each county contained in the district, within thirty (30) days after holding of the election, and the county elections officials, respectively, shall certify the result of the election in each county, respectively, to the board of the district.
In the event that the election is consolidated with any other election, the returns of the election, the method of canvassing, and the results thereof shall be designated and declared in accordance with Part 3 (commencing with Section 10400) of Division 10 of the Elections Code.
At any special bond election called pursuant to this part, all residents of the district who are qualified electors possessing the qualifications prescribed by the general election laws of the State of California shall be entitled to vote thereat. All special bond elections shall be held and conducted as nearly as practicable in accordance with the general laws of the State of California, including provisions with respect to voting by absent voters, but the requirements as to the form of ballots need not apply except to the extent adopted by the board. Whether a resident of the district is a qualified elector within the district shall be conclusively determined by the last great register of voters of the county or portion of the county in which the election is held. Except when the special bond election is consolidated with any other election, the board shall designate the hours during which the polls shall be kept open. The polls shall not be opened before 7 a.m. nor kept open later than 8 p.m. and shall be kept open for not less than four hours.
At any special bond election two or more propositions for incurring indebtedness may be submitted at the same election in which event the votes cast for and against each proposition shall be counted separately, and whenever three-fifths of the qualified electors voting on any one of such propositions vote in favor thereof such proposition shall be deemed adopted.
ARTICLE 2. Form and Terms of General Obligation Bonds [29169. - 29184.]
Whenever three-fifths of the votes cast at any special bond election or on any proposition submitted thereat are in favor of incurring the indebtedness set forth in such proposition, the board may by resolution at any time it deems proper, or from time to time, provide for the authorization and issuance of the bonds not exceeding the amount authorized at such election.
Bonds may be issued in form payable to bearer, with coupons attached for payment of interest and, if so issued, may be made subject to registration. Bonds issued in bearer form shall constitute negotiable instruments for all purposes under the laws of the State of California. The district may appoint a registration agent which may be a bank or trust company and authorize such registration agent to maintain books of registry and to register, authenticate and exchange bonds on such terms and conditions and pursuant to such rules and regulations as the district may provide. The district may provide for the interchange of coupon bonds for registered bonds and registered bonds for coupon bonds, and may provide that the bonds shall be registered as to principal only, or as to both principal and interest, or otherwise, as the district may determine.
Coupon bonds may be issued in denominations of one thousand dollars ($1,000), or multiples thereof, as the district may determine. Coupon bonds of different denominations shall be exchangeable for coupon bonds of other denominations or for registered bonds on terms and conditions as the district may determine, including provisions for the authentication of any bonds issued upon the exchange by the registration agent or other agents appointed by the district for that purpose.
Registered bonds may be issued without limitation as to principal amount, as may be determined by the district, except that registered bonds shall be in denominations of one thousand dollars ($1,000) or multiples thereof. Registered bonds of any denomination shall be exchangeable with bonds, either in registered or coupon form, of other denominations on such terms and conditions as the district shall determine, including provisions for authentication of bonds issued upon such exchange by the registration agent or other agents appointed by the district for that purpose, and upon the payment of such reasonable charges as may be prescribed by the district.
Bonds shall bear interest at a rate of not to exceed 8 percent per annum, payable semiannually, except that interest for the first year or any fraction thereof may be paid in one installment.
The district may provide for redemption of bonds prior to maturity, on such notice and at such time or times and with such redemption provisions, including premiums, as the district may determine, provided that no redemption premium shall be in excess of 6 percent of the principal amount of the bonds to be redeemed. No bond is subject to call or redemption prior to its fixed maturity date, unless the right to exercise such call and the redemption price are expressly stated on the face of the bond. When bonds have been validly called for redemption and payment of the principal thereof, and the interest thereon accrued to the date of redemption, together with the redemption premium, if any, shall have been made or provided for, interest thereon shall cease.
The district may provide for the payment of the principal and interest of bonds at any place within the State of California, or at any other place within the United States, which the district may designate. The place of payment shall be specified in the bonds and payment shall be made in any coin or currency of the United States of America which at the time of payment is legal tender for public and private debts.
Bonds shall bear dates prescribed by the district.
Bonds may be serial or sinking fund bonds, or in part serially and in part sinking fund bonds, with such maturities and in such amounts annually, semiannually or otherwise, as the district may determine at the time of authorizing the issuance thereof.
No bond by its terms shall mature in more than fifty (50) years from its own date, and in the event any authorized issue is divided into two or more series or divisions, the maximum maturity herein authorized shall be calculated from the date on the face of each bond, separately, irrespective of the fact that different dates may be prescribed for the bonds of each separate series or division of any authorized issue.
The district may divide any authorized issue into one or more series or division and fix different dates and different maturity dates for the bonds of each series or division.
The district may prescribe the form of bonds issued pursuant to this chapter, and of the interest coupons attached to those bonds. Bonds shall be signed by the president of the board, or by another member of the board designated by the board by resolution for that purpose, and countersigned by the secretary of the district and the seal of the district shall be affixed to those bonds. The interest coupons on the bonds shall be numbered consecutively and signed by the chief financial officer of the district. The signature on all coupons and one signature on the bonds may be engraved, lithographed, or printed facsimile signature. The seal of the district may be affixed to any bond by mechanical reproduction of a facsimile of the seal. In case any officer whose signature or countersignature appearing on the bonds or coupons shall cease to be an officer of the district before the delivery of the bonds to the purchaser, that signature or countersignature shall nevertheless be valid and sufficient for all purposes, the same as if that officer had remained in office until the delivery of the bonds. If the district appoints a registration agent, fiscal agent, or other agent to authenticate bonds, any bond of the district, whether in coupon or registered form, may be signed by the facsimile signatures of the officers of the district with a facsimile seal of the district affixed mechanically or otherwise reproduced on the bonds, provided that the bonds shall be authenticated by the fiscal agent, registration agent, or other agent appointed by the district for that purpose. Any agent appointed by the district to authenticate registered bonds or exchange bonds of different denominations, or coupon bonds for registered bonds, or vice versa, shall be a bank or trust company authorized to transact, and transacting, business in the State of California or the State of New York.
Pending the actual issuance or delivery of bonds, the district may issue temporary or interim bonds, certificates, or receipts, of any denomination whatsoever, with or without coupon, and in such form as may be prescribed by the board, to be exchanged for definitive bonds when ready for delivery.
The district may provide that interest on bonds may be paid out of the proceeds of the sale of the bonds during the actual construction of any project, for the acquisition, construction, or completion of which bonds have been issued, and for a period of not to exceed three years thereafter, as determined by the district.
The district shall provide for the payment of the principal of and interest on the bonds by the levy and collection of taxes upon all property in the district subject to taxation by the district without limitation of rate or amount as provided in Sections 29121 and 29122 of this part, except that such taxes need not be levied to the extent that the district deposits in the treasury set apart for that purpose moneys derived from surplus revenues or any appropriations which may be made to it for that purpose or from any other funds howsoever derived.
Any general obligation bonds which shall be issued under the provisions of this part shall be legal investment for all trust funds; for the funds of insurance companies, banks—both commercial and savings—and trust companies; and for state school funds; and whenever any money or funds may, by any law now or hereafter enacted, be invested in bonds of cities, cities and counties, counties, school districts, or irrigation districts within the State of California, such money or funds may be invested in the general obligation bonds issued under this part, and whenever bonds of cities, cities and counties, counties, school districts, or irrigation districts within this State may, by any law now or hereafter enacted, be used as security for the performance of any act or the deposit of any public moneys, the said bonds issued under this part may be so used. The provisions of this part shall be in addition to all other laws relating to legal investments and shall be controlling as the latest expression of the Legislature with respect thereto.
ARTICLE 3. Issuance and Sale of General Obligation Bonds [29200. - 29202.]
The district may by resolution at any time, or from time to time, provide for the authorization and issuance of any bonds authorized pursuant to this part and for the sale of the whole or any part thereof.
Before making a sale of any of the bonds, notice shall be given by publication once a week, for two weeks, in a newspaper of general circulation in the district, if there is one, and no sale shall be held prior to the expiration of 15 days from the first publication of the notice. Copies of such advertisement may be published in any newspaper or financial publication in the United States and copies may be mailed to recognized investment dealers, banks, investing institutions and statistical organizations, together with any related material pertaining to the district and its bonds, but no defect in any such additional publication or failure to mail or failure of any person to receive copies of any such materials so mailed shall affect the validity of the sale. The board may reject any or all bids received if it determines that the bids are not satisfactory as to price or as to the responsibility of the bidders. If no bids are received or if the board rejects all bids received, the board may either readvertise or sell the bonds at private sale, provided, however, that if the bonds are sold at private sale, they shall not be sold at a price lower than the highest bid, if any, which was received at the public sale.
The published notice of sale shall describe the bonds and set forth the terms and conditions of sale.
ARTICLE 4. Refunding Bonds [29210. - 29225.]
The district may provide for the funding or refunding of outstanding general obligation indebtedness pursuant to this article, if any of the following conditions exist:
The district has indebtedness evidenced by bonds, notes, or other evidences of indebtedness, which according to their terms are subject to call or payment before maturity.
The district has filed a petition under any bankruptcy law of the United States and refunding of its indebtedness is authorized in the bankruptcy proceedings.
The holder or holders of outstanding indebtedness has consented to exchange such outstanding bonds for refunding bonds bearing a lower rate of interest than such outstanding bonds.
The district by a two-thirds vote of the board may fund or refund its general obligation indebtedness at, after, or before maturity and issue refunding bonds of the district to refund the indebtedness evidenced by such outstanding securities.
Refunding general obligations may be issued and may be sold in accordance with Articles 2 (commencing with Section 29169) and 3 (commencing with Section 29200), except that no election need be called or held for the purpose of authorizing the issuance of refunding bonds and the refunding bonds may be sold and the proceeds thereof applied to the redemption of bonds of indebtedness or may be exchanged at not less than their par value for the evidences of indebtedness to be refunded.
Refunding bonds issued pursuant to this article will have the same weight and force and may be used in the same manner as the bonds to be refunded.
The proceeds of any sale of refunding bonds for cash shall be deposited with the chief financial officer or depositary, as determined by the district, to the credit of the Funding Fund, and applied only to refunding the indebtedness for which the bonds are issued.
Any proceeds of the refunding bonds remaining after the indebtedness has been paid shall be deposited in the fund established for the payment of principal and interest on the refunding bonds and used only for the purpose of paying such principal or interest as it matures.
At the time of making the general tax levy after incurring the bonded indebtedness and annually thereafter until the refunding bonds are paid or until there is a sum in the treasury set apart for that purpose sufficient to meet all payments of principal and interest on the bonds as they become due, the district shall levy and collect a tax sufficient to pay the interest on the bonds and such part of the principal as will become due before the proceeds of the next general tax levy will be available.
If the earliest maturity of the refunding bonds is more than one year after the date of issuance, the board shall levy and collect annually a tax sufficient to pay the interest as it falls due and to constitute a sinking fund for payment of the principal on or before maturity.
The taxes shall be levied and collected as other district taxes, and are in addition to all other taxes. They shall be used only for the payment of the bonds and interest thereon.
Refunding bonds may be issued in a principal amount sufficient to provide funds for (a) the payment of the principal of and interest on the bonds, notes or other evidences of indebtedness to be refunded; (b) all expenses incidental to the calling, retirement or payment of the outstanding bonds, notes or other evidences of indebtedness and the issuance of refunding bonds including the difference in amount between the par value of the refunding bonds and any amount less than par; (c) any amount necessary to be made available for the payment of interest upon the refunding bonds from the date of their delivery to the date of maturity or payment of the bonds, notes or other evidences of indebtedness to be refunded out of the proceeds of sale or the date upon which the bonds, notes or evidences of indebtedness to be refunded will be paid pursuant to call and redemption thereof or pursuant to any agreement with the holders thereof for the refunding or exchanging of such bonds, notes or other evidences of indebtedness; and (d) the premium if any necessary to be paid in order to call and retire the outstanding bonds, notes or other evidences of indebtedness to be refunded. Refunding bonds may be exchanged at not less than their par value and accrued interest for outstanding bonds, notes or other evidences of indebtedness to be refunded thereby.
When sufficient money is in the Funding Fund to redeem one or more outstanding past due bonds, notes, or other evidences of indebtedness, or to redeem one or more of the outstanding bonds, notes, or other evidences of indebtedness, that are subject to call or payment before maturity, and that are proposed to be funded or refunded, the chief financial officer shall publish a notice that the chief financial officer is prepared to pay the bond, note, or other evidence of indebtedness and give its number, if any, in that notice. The notice shall be published once a week for two weeks in a newspaper of general circulation in the district, if there is one. Copies of that advertisement may be published in any newspaper or financial publication in the United States. If the bond, note, or other evidence of indebtedness to be called for redemption or refunded is not presented for redemption on or before the date specified for redemption, as set forth on the face of the outstanding bond, note, or other evidence of indebtedness, interest upon it shall cease.
At the same time, the chief financial officer shall deposit in the post office a copy of the notice, enclosed in a sealed envelope, postage prepaid, addressed to the registered owner of any such bond, note, or other evidence of indebtedness, registered pursuant to this part, whose address appears upon the record in the chief financial officer’s office. If the bond, note, or other evidence of indebtedness is not presented within the time specified in the notice, the interest upon it ceases and the amount due shall be set aside for the payment when presented.
When any outstanding bonds, notes, or other evidences of indebtedness are surrendered and paid, the chief financial officer shall cancel them by endorsing on their faces the amount for which they are received, “Canceled,” and the date of cancellation.
The chief financial officer shall keep a record of bonds, notes, or other evidences of indebtedness redeemed, and report the redemption to the board. At the end of each month in which there has been a redemption, a report of the redemption shall be made accompanied by the bonds, notes, or other evidences of indebtedness that have been taken up and canceled or by a certificate of their destruction by any bank or trust company appointed by the board as fiscal agent or paying agent for those bonds, notes, or other evidences of indebtedness and authorized to destroy bonds, notes, or coupons, or other evidences of indebtedness upon payment of them.
Any money remaining in the Funding Fund, after all outstanding bonds, warrants, judgments, notes, or other evidences of indebtedness proposed to be refunded have been taken up and canceled, shall be deposited in the fund established for the payment of principal and interest on the refunding bonds and used only for paying such principal or interest as they mature.
Refunding of revenue bonds of the district may be accomplished in the manner provided by the Revenue Bond Law of 1941, all of the provisions of which are hereby made applicable to the district.
ARTICLE 5. Temporary Borrowing [29230. - 29236.]
The district may borrow money for the purpose of defraying general administrative and preliminary expenses of the district, lawfully incurred, prior to the time moneys to be raised by the first tax levy for the district are available, a sum which shall not exceed five cents ($0.05) on each one hundred dollars ($100) of assessed valuation of taxable property in the district at the time the moneys are borrowed, and to evidence such borrowing by notes bearing interest at a rate not to exceed six (6) per centum per annum. The notes shall be payable from the first tax levy made by the district and the tax levy shall contain a sum sufficient to provide for the payment of the notes and the interest thereon. The form of said notes their issuance and sale, will be governed by the applicable provisions referred to in Section 29233. The maturity of said notes shall not exceed two (2) years.
At any time prior to the first receipt by the district of revenues from taxation, the counties within the district may loan any available money to the district for the purposes of organization and operation. Such expenditures shall constitute a proper expenditure of county funds.
The treasurers of the counties within the district shall pay into the treasury of the district all funds held by them to the credit of the district.
The district may borrow money in accordance with the provisions of Article 7 (commencing at Section 53820), Chapter 4, Part 1, Division 2, Title 5 of the Government Code, and these sections apply to and govern all such proceedings instituted under this part.
The district may borrow money in anticipation of the sale of bonds which have been authorized to be issued, but which have not been sold and delivered, and may issue negotiable bond anticipation notes therefor and may renew the same from time to time, but the maximum maturity of any such notes, including the renewals thereof, shall not exceed five years from the date of delivery of such original notes. Such notes may be paid from any moneys of the district available therefor and not otherwise pledged. If not previously otherwise paid the notes shall be paid from the proceeds of the next sale of the bonds of the district in anticipation of which they were issued and if not so paid taxes may be levied for their payment in the same manner as taxes are levied for the payment of general obligation bonds pursuant to Section 29121 until such bonds are issued. Such notes shall not be issued in an amount in excess of the aggregate amount of bonds which the district has been authorized to issue, less the amount of any bonds of such authorized issue previously sold, and also less the amount of other bond anticipation notes therefor issued and then outstanding. The notes shall be issued and sold in the same manner as the bonds. Such notes and the resolution or resolutions authorizing the same may contain any provisions, conditions, or limitations which a resolution of the district authorizing the issuance of bonds may contain.
The district may borrow money for the purchase of transit vehicles, as defined in subdivision (b) of Section 99501, transit equipment, or transportation facilities, or for capital improvements, by the issuance of grant anticipation notes issued pursuant to Article 7.7 (commencing with Section 53859) of Chapter 4 of Part 1 of Division 2 of Title 5 of the Government Code payable on the basis of any of the following:
From appropriated state funds.
From other funds committed, but not appropriated, and evidenced by an appropriate document of intent.
On specific dates or events and evidenced by an appropriate document of intent. There shall be no liability on the state for funds appropriated but not allocated.
In addition to the grant money that may be pledged for the payment of the notes pursuant to Section 53859.06 of the Government Code, the district may pledge as security, on terms that it deems appropriate, the transit vehicles or equipment, transportation facilities, or capital improvements acquired with the proceeds of the notes.
In addition to any other existing authority, the district may borrow money and incur indebtedness pursuant to Article 7.4 (commencing with Section 53835) of Chapter 4 of Part 1 of Division 2 of Title 5 of the Government Code.
ARTICLE 6. Revenue Bonds [29240. - 29241.]
As an alternative procedure for the raising of funds, the district is hereby authorized to issue bonds, payable from revenues of any facility or enterprise to be acquired or constructed by the district, in the manner provided by the Revenue Bond Law of 1941, all of the provisions of which are hereby made applicable to the district, provided however, that no election shall be required in the case of revenue bonds authorized by the board of directors for rapid transit facilities and any and all parts thereof and all additions, extensions and improvements thereto and all other facilities authorized to be acquired, constructed or completed by the district under this part, if prior to such authorization a proposition for the issuance of general obligation bonds has been adopted by vote of the qualified electors of the district pursuant to Section 29168; and provided, further, that nothing contained in the Revenue Bond Law of 1941 shall be deemed to restrict the power of the district to levy taxes and use their proceeds for all district purposes within the restrictions established by this part.
The district is hereby declared to be a local agency within the meaning of the Revenue Bond Law of 1941. The term “enterprise” as used in the Revenue Bond Law of 1941 shall for all purposes of this part include rapid transit facilities and any and all parts thereof and all additions, extensions and improvements thereto and all other facilities authorized to be acquired, constructed or completed by the district under this part. The district may issue revenue bonds under such law for any one or more facilities or enterprises authorized to be acquired, constructed or completed by the district, or in the alternative, may issue revenue bonds under such law for the acquisition, construction and completion of any one of such facilities and also issue bonds payable from assessments in accordance with the procedure provided by this part for any other of such facilities. Nothing in this part contained shall prevent the district from availing itself of, or making use of, any procedure provided hereunder for the issuance of bonds of any type or character for any of the facilities or works authorized hereunder, and all such proceedings may be carried on simultaneously or, in the alternative, as the directors may determine.
ARTICLE 7. Equipment Trust Certificates [29250. - 29253.]
The district shall have power to purchase equipment such as cars, trolley buses and motor buses, rolling equipment, and may execute agreements, leases and equipment trust certificates in the forms customarily used by private corporations engaged in the rapid transit business appropriate to effect such purchase and leasing of rolling equipment and may dispose of such equipment trust certificates upon such terms and conditions as the board may deem appropriate. All money required to be paid by the district under the provisions of such agreements, leases and equipment trust certificates shall be payable solely from the revenue or income to be derived from the transportation system and from grants and loans as provided in Sections 29080 and 29081 of this part. Payment for such equipment, or rentals therefor, may be made in installments, and the deferred installments may be evidenced by equipment trust certificates payable solely from such revenue or income, and title to such equipment shall not vest in the district until the equipment trust certificates are paid.
The agreement to purchase or lease may direct the vendor or lessor to sell and assign or lease the rolling equipment to a bank or trust company duly authorized to transact business in the State of California as trustee, lessor or vendor for the benefit and security of the equipment trust certificates and may direct such trustee to deliver the rolling equipment to one or more designated officers of the district and may authorize the district to simultaneously therewith execute and deliver an installment purchase agreement or a lease of the equipment to the district.
The agreements and leases shall be duly acknowledged before some person authorized by law to take acknowledgments of deeds and in the form required for acknowledgment of deeds and such agreements, leases, and equipment trust certificates shall be authorized by resolution of the district and shall contain such covenants, conditions and provisions which may be deemed necessary or appropriate to insure the payment of the equipment trust certificates from the revenue or income to be derived from the rapid transit system.
The covenants, conditions and provisions of the agreements, leases, and equipment trust certificates shall not conflict with any of the provisions of any trust agreement securing the payment of bonds, notes or certificates of the district.
ARTICLE 8. Special Assessment Bonds [29260. - 29262.]
In addition to all other powers granted under this part, the district shall have the right to acquire, construct and complete any improvements authorized hereunder by special assessment proceedings. The Improvement Act of 1911 and the Improvement Bond Act of 1915 are applicable to the district and the powers and duties conferred by those acts upon the boards, officers and agents of the district; provided, that the improvements authorized to be constructed or acquired by this section are limited to those permitted to be constructed or acquired by the district under the provisions of this part.
An assessment district formed or proposed to be formed under this part, on the acquisition of any property or the construction of any improvement thereby, shall not be subject to any of the provisions of the District Investigation Law of 1933.
An assessment district formed or proposed to be formed under this part, on the acquisition of any property or the construction of any improvement thereby, shall not be subject to any of the provisions of the Special Assessment Investigation, Limitation and Majority Protest Act of 1931.
ARTICLE 9. Reissuance of Bonds, Notes, Coupon or Other Evidence of Indebtedness, Lost, Destroyed, Defaced or Mutilated [29270. - 29271.]
If lost or completely destroyed, any bond, note, coupon, or other evidence of indebtedness may be reissued in the form and tenor of the lost or destroyed bond, note, coupon, or other evidence of indebtedness, upon the owner furnishing all of the following to the satisfaction of the district:
Proof of ownership.
Proof of loss or destruction.
An undertaking to indemnify the district against any loss incurred on account of the bond, note, coupon, or other evidence of indebtedness.
Payment of the cost of preparing and issuing the new bond, note, coupon, or other evidence of indebtedness.
If defaced, mutilated, or partially destroyed, any bond, note, coupon, or other evidence of indebtedness may be reissued in the form and tenor of the defaced or partially destroyed bond, note, coupon, or other evidence of indebtedness, to the bearer, or if registered, to the registered holder, at his expense, on surrender of the defaced or partially destroyed bond, note, coupon, or other evidence of indebtedness, and on such other conditions as the resolution authorizing the reissuance may provide.
ARTICLE 10. Past Due Bonds [29280. - 29282.]
When a bond, note, interest coupon, or other evidence of indebtedness payable from funds in the custody of the chief financial officer of the district is presented to the chief financial officer for payment and is not paid for want of funds, the chief financial officer shall endorse upon it “Not paid for want of funds,” the date of presentation, and a serial number indicating the order of presentation, and shall sign or stamp their name on it.
Upon receipt of the first money in the treasury applicable to their payment, the chief financial officer shall set apart the amount necessary to pay the past due bonds, notes, coupons, or other evidences of indebtedness that have been registered for want of funds. The chief financial officer shall give notice by registered mail to the owner or holder of the registered bonds, notes, coupons, and other evidences of indebtedness, at the address last filed, stating that the chief financial officer is ready to pay for them. The bonds, notes, coupons, and other evidences of indebtedness shall be paid from that money, in the order of their registration.
If the registered bonds, notes, coupons, and other evidences of indebtedness are not presented for payment within 30 days from mailing of the notice, the chief financial officer shall apply the fund set aside to the payment of the unpaid registered bonds, notes, coupons, and other evidences of indebtedness next in order, until all registered bonds, notes, coupons, and other evidences of indebtedness have been called.
ARTICLE 11. General Provisions [29290. - 29293.]
All bonds and other evidences of indebtedness issued by the district under the provisions of this part, and the interest thereon, are free and exempt from all taxation within the State of California, except for transfer, franchise, inheritance and estate taxes.
An action to determine the validity of bonds or other evidences of indebtedness may be brought pursuant to Chapter 9 (commencing with Section 860) of Title 10 of Part 2 of the Code of Civil Procedure.
Any person who, without probable cause, institutes in any court, state or federal, any action or proceeding contesting the validity of the issuance or sale by the district of any bonds or other evidences of indebtedness authorized by this part, and who does not prevail in such action or proceeding, shall be liable in damages to the district, in an amount which will compensate the district for all the detriment proximately caused thereby, or which, in the ordinary course of things, would be likely to result therefrom. He shall also be liable for the costs and attorney’s fees paid or incurred in the defense of the action or proceeding. No proceeding contesting the validity of the issuance or sale by the district of any bonds or other evidences of indebtedness authorized by this part shall be instituted following the expiration of 60 days from and after the date of the election authorizing the issuance of the bonds or, in the case of indebtedness for which an election is not required, 60 days from and after the date of the resolution of the board authorizing the issuance of the indebtedness involved.
Notwithstanding any other statutory provision to the contrary, the district may pledge all or any part of income received under Section 29123 to the payment of any revenue bonds to be issued pursuant to Article 6 (commencing with Section 29240) of this chapter or the payment of any equipment trust certificates to be issued pursuant to Article 7 (commencing with Section 29250) of this chapter. Income so pledged may be declared in such pledge to be revenues of the enterprise for all purposes of the Revenue Bond Law of 1941, notwithstanding anything to the contrary therein contained.
CHAPTER 9. Annexation [29500. - 29590.]
ARTICLE 1. Annexation Agreement [29500. - 29504.]
Any county not included within the boundaries of the district, including a county which has withdrawn from the district pursuant to Chapter 10 of this part, may be annexed thereto in the manner provided in this chapter.
The board of supervisors of the county proposed to be annexed shall agree in writing with the board of directors of the district upon the terms and conditions of annexation, which agreement (among other things) may provide for the levy and collection of special taxes within the county in addition to the taxes elsewhere in this part provided for, the fixing of rates, rentals, and charges differing from those fixed or existing elsewhere within the district, the incurring or assumption of indebtedness, or the making of a payment or payments, or the transfer of property, real and personal, and other assets to the district by the county.
As a condition of annexation, the district shall require any county seeking to annex to the district to reimburse the district for the county’s equitable share of the previously incurred cost of financing capital expenditures within the district theretofore imposed by taxation on territory within the district. The amount of reimbursement due from such county, unless otherwise provided for in the annexation agreement entered into pursuant to Section 29501 of this code, shall be computed on the following basis: one-half in the proportion that the population of the county bears to the total population of the district and one-half in the proportion that the assessed value of the real estate of the county bears to the total assessed value of the real estate of the district. Determinations of population shall be made by the district on the latest official information available to it. Determinations by the district as to the amount of capital expenditures shall be conclusive in each case.
As an alternative method of annexation, a petition may be presented to the board of supervisors of a county proposed to be annexed, signed by qualified electors of the county, in number to at least ten (10) percent of the total vote cast at the last general election within the county. The petition shall contain statements and declarations setting forth the reason for annexation. Such petition may be on separate papers, but each paper shall contain the affidavit of the party who circulated it, certifying that each name signed thereto is the true signature of the person whose name it purports to be. The clerk of the board of supervisors of such county shall compare the signatures with the affidavits of registration and certify to the board of supervisors the sufficiency or insufficiency of such petition. If found and certified by the clerk as being sufficient, such petition shall have all the force and effect of a resolution adopted by the board of supervisors of such county.
Upon receipt of a petition pursuant to Section 29503, the board of supervisors shall communicate with the board and negotiate an annexation agreement and hold an election as provided in this part.
ARTICLE 2. Approval by District [29520. - 29526.]
The agreement shall become effective and be binding upon the district and the county when approved in the manner set forth in this chapter. The board of directors of the district shall by ordinance setting forth the agreement at length declare its intention of causing it to be executed by the district.
The ordinance, together with a notice fixing the time and place for hearing thereon, shall be published once in a newspaper of general circulation published in the district. The time fixed for the hearing shall be not less than thirty (30) nor more than sixty (60) days from the date of the publication of the ordinance.
At the hearing any person interested may file with the board of directors of the district written objections to the execution of the agreement.
Upon the hearing the board of directors of the district shall determine whether or not the agreement will be carried into execution and shall hear and determine all objections thereto. Failure of any person interested in the district or in the matter of the proposed execution of the agreement to show cause in writing pursuant to Section 29522, constitutes an assent on his part to a change in the boundaries of the district and to the execution of the agreement.
Any hearing on the agreement may be adjourned from time to time by the board of directors of the district without further notice other than an order to be entered upon the minutes of the meeting fixing the time and place of adjournment.
If no protests are filed or if the protests filed are overruled and denied, the board of directors of the district shall thereupon by resolution finally approve the agreement and authorize its execution, which shall become effective when executed by the county, duly authorized in the manner provided in this chapter.
When executed by the district the agreement shall be dated and an executed copy filed with the secretary of the district. An executed copy shall also be filed with the clerk of the county to be annexed.
ARTICLE 3. Approval by County [29540. - 29545.]
At any time after the board of directors of the district has finally approved the agreement of annexation the board of supervisors of the county to be annexed shall cause an election to be held in the county to determine whether the county will be annexed to the district upon the terms and conditions stated in the agreement.
Notice of election shall be published once a week for two successive weeks (two publications) in a newspaper of general circulation published within the county, and shall either state that a copy of the annexation agreement is on file in the office of the clerk of the county proposed to be annexed, and open to the inspection of all persons interested, or set forth the terms and conditions of the agreement of annexation at length, in the discretion of the board of supervisors calling the election.
The ballots for the election shall contain substantially the instructions required to be printed on ballots for use at general state and county elections and in addition shall set forth the proposition of annexation substantially as follows:
If upon a canvass of the election it is found that a majority of all votes cast on the proposition at the election were cast in favor of the annexation, the proposition and all of the terms and conditions of the agreement of annexation shall be deemed carried and approved by the voters.
If the proposition fails to carry, the result shall be entered upon the minutes of the board of supervisors of the county.
If the proposition receives the vote of the requisite majority of voters, the board of supervisors of the county shall enter in its minutes an order declaring the result of the election and shall thereupon cause the agreement of annexation to be executed by its duly authorized officers.
ARTICLE 4. Establishment of Annexation [29560. - 29560.]
Upon receipt by the district of a copy of the agreement of annexation properly executed by the district and the county proposed to be annexed the board of directors of the district shall pass a resolution declaring the county annexed to the district, and shall cause a certified copy of the resolution to be filed with the Secretary of State. From and after the date of filing of the resolution with the Secretary of State the annexation of the county to the district is complete.
ARTICLE 5. Effect of Annexation [29570. - 29570.]
From and after the date of annexation the board of directors of the district shall levy upon all of the property in the county annexed such taxes, tolls, or charges as are necessary to provide funds for the payment of the indebtedness assumed by the county or otherwise necessary to comply with the terms and conditions of the annexation agreement, all in addition to the general district taxes authorized elsewhere in this part to be levied and collected.
ARTICLE 6. Contest of Annexation [29580. - 29580.]
The validity of any proceedings for the annexation of any county to the district shall not be contested in any action unless the action is brought within three (3) months after the completion of the proceedings.
ARTICLE 7. Annexation of Land Owned Solely by District [29590. - 29590.]
When the district is the sole owner of any tract of land within the County of San Mateo upon which is located works and facilities of the district, the board, upon determining that the inclusion of that land will be for the best interests of the district, may, by resolution, declare that such land shall be included in the district. The inclusion of such land within the district is effective immediately upon the adoption of the resolution.
CHAPTER 10. Withdrawal From District [29650. - 29654.]
In addition to the right of withdrawal of a county as provided in Section 29650, any county may withdraw from the district at any time prior to the date of adoption by the board of a resolution calling a special election to submit to the qualified voters of the district a proposition of incurring a bonded indebtedness as provided in Section 29158, provided the board of directors of the district elects to accept for filing and approves a resolution of withdrawal adopted by the board of supervisors of the county seeking withdrawal.
Withdrawal from the district shall be by a resolution adopted by a majority vote of the board of supervisors.
The withdrawal of any county from the district pursuant to this chapter shall not be effective until the resolution of withdrawal adopted by the board of supervisors is filed with the board of directors of the district.
The withdrawal of a county pursuant to this chapter does not invalidate any taxes or assessments levied or assessed against any property in the county prior to withdrawal, nor relieve such property of any other financial obligation or debt of the district incurred prior to withdrawal.
Any county which is withdrawn from the district pursuant to this chapter may be subsequently annexed thereto on compliance with Chapter 9 (commencing with Section 29500).
CHAPTER 10.5. Special Service Districts [29660. - 29740.]
ARTICLE 1. Proposal of Formation [29660. - 29666.]
One or more special service districts for any of the purposes in which the district is authorized to engage may be created within the boundaries of the district. Such special service districts may consist of one or more cities, with or without unincorporated territory, or unincorporated territory alone. Cities or unincorporated territory included within a special service district may be in the same or separate counties and need not be contiguous. No city shall be divided in the formation of such special service district, but a city may be in more than one special service district formed under this chapter.
Proceedings for the creation of a special service district may be initiated by resolution of the legislative body or bodies of the city or cities proposed to be included in such special service district and if unincorporated territory is proposed to be included in such special service district by resolution of the board or boards of supervisors of the county or counties in which such unincorporated territory is situated, or if only unincorporated territory is proposed to be included in such special service district, by resolution of the board or boards of supervisors of the county or counties in which such unincorporated territory is situated. Such resolution or resolutions shall declare that the public interest or necessity demands the creation of a special service district, shall describe its boundaries and shall request the formation of such special service district. When the entire area of a public agency is to be included in the special service district, it may be described by name. Certified copies of the resolution or resolutions shall be filed with the secretary of the district.
As an alternative to the initiation of proceedings for the formation of a special service district by resolution or resolutions, a petition may be filed with the secretary of the district signed by voters equal in number to at least 25 percent of the registered voters registered within the proposed special service district as determined from the affidavits of registration. The boundaries of the proposed special service district shall be described in the petition; provided, that when the entire area of a public agency is to be included in the special service district, it may be described by name.
The petition shall declare that the public interest or necessity demands the creation of a special service district within the area of the district described in the petition. The petition may include one or more separate documents, but each document shall contain the affidavit of the party who circulated it, certifying that each name signed thereto is the true signature of the person whose name it purports to be.
The secretary of the district shall compare the signatures in the petition with the affidavits of registration on file with the county elections official, and shall certify to the board as to the sufficiency or insufficiency of the petition.
The following provisions of the Government Code shall not apply to this chapter or any proceeding taken thereunder:
Chapter 6.6 (commencing with Section 54775), Part 1, Division 2 of Title 5, relating to local agency formation commissions.
The District Investigation Law of 1933 (Chapter 2 (commencing with Section 58500), Division 1 of Title 6).
Chapter 3 (commencing with Section 58850), Division 1 of Title 6, relating to county boundary commissions.
Chapter 3.5 (commencing with Section 58900), Division 1 of Title 6, relating to notice of formation or change in boundaries of districts.
Nothing contained herein shall allow the San Francisco Bay Area Rapid Transit District, or any special service district formed hereunder, to exercise any jurisdiction, taxing, or otherwise, over any territory heretofore withdrawn from the San Francisco Bay Area Rapid Transit District pursuant to Chapter 10 (commencing with Section 29650) of the Public Utilities Code, or never annexed thereto pursuant to Chapter 9 (commencing with Section 29500) of the Public Utilities Code.
ARTICLE 2. Hearing [29670. - 29674.]
Within 30 days after receipt of the resolution or resolutions of the legislative body or bodies or receipt of the certification of the sufficiency of a petition by the secretary of the district, the board shall by resolution designate the special service district as “San Francisco Bay Area Rapid Transit District, Special Service District No. ____ (here insert number)” (all such special service districts shall be numbered consecutively), shall fix a time and place for a hearing on the proposed creation of the special service district and shall not later than five days after fixing the time and place of hearing publish notice thereof.
The notice of hearing shall be published once in a newspaper of general circulation published in the district. The board, in its discretion, may give such additional notice as it deems desirable.
The time fixed for the hearing shall be not less than ten (10) nor more than thirty (30) days from the date of the publication of the notice.
At or before the hearing, any person interested may file with the secretary of the district written objections to the creation of the special service district or to the inclusion of his property therein. Upon the hearing the board shall hear and determine all protests and objections. The hearing may be continued from time to time by the board without further notice other than an order to be entered upon the minutes of its meeting fixing the time and place of the continued hearing.
If no protests are filed or if the protests filed are overruled and denied by the board, the board shall by resolution approve the creation of the special service district and shall by resolution call an election as provided in Article 3 (commencing with Section 29680).
ARTICLE 3. Election [29680. - 29685.]
At the time of the approval of the creation of a special service district, the board shall call an election in the territory proposed to be included in the special service district for the purpose of submitting to the voters in such territory the question of whether the special service district shall be created and established.
Such election shall be held on the next established election date not less than 74 days after the board’s approval of the creation of the special service district.
The ballot for the election shall contain such instructions as are required by law to be printed thereon and in addition thereto the following:
No person is entitled to vote at the election unless he is a registered voter residing within the territory proposed to be included in the special service district. The election may be held on the same day as any other state, county or city election and may be consolidated.
The costs of the election required by this article shall be borne by the district.
The question of the creation of a special service district shall be canvassed separately for each public agency, or portion thereof, in which an election is held, and the board shall order and declare the special service district created in each public agency, or portion thereof, in which an election was held and in which a majority of those who voted upon the proposition of creating the special service district voted in favor of the proposition, and excluding each public agency, or portion thereof, in which an election was held and in which a majority of those who voted upon the proposition of creating the special service district voted against the proposition. A certified copy of the resolution declaring the special service district created shall be filed in the office of the Secretary of State, and upon such filing the special service district shall be established.
ARTICLE 4. Taxing Subdivision [29690. - 29690.]
A special service district has no separate corporate existence, but shall be deemed to be a taxing subdivision of the district, and within each special service district the board may levy and collect or cause to be collected taxes for any lawful purpose in accordance with Chapter 7 (commencing with Section 29120) and Section 29183.
ARTICLE 5. Bond Election [29700. - 29705.]
At any time after the approval by the board of the creation of a special service district, as provided in Section 29674, the board may provide for the submission of a proposition for the incurring of a bonded indebtedness to be incurred by the district on behalf of the special service district to pay the costs of acquiring, constructing or completing the whole or any portion of any transit facilities, or for acquiring any works, lands, structures, rights, equipment, or other property necessary or convenient to carry out the objects, purposes or powers of the district within the boundaries of a special service district created pursuant to this chapter.
The proposition for incurring a bonded indebtedness under Section 29700 may be submitted to the voters at the same election as the proposition to create the special service district held pursuant to Article 3 (commencing with Section 29680), or at an election subsequent to the creation of the special service district.
Except as otherwise provided in this chapter, the provisions of Chapter 8 (commencing with Section 29150) relating to general obligation bonds with the exception of Sections 29150 to 29158, inclusive, shall substantially govern as to all matters pertaining to the manner of calling, giving notice and holding the bond election, the execution, issuance, sale, maturity, redemption, refunding and validation of the bonds authorized by this article, the payment of interest from bond funds, the status of the bonds as investments, the reissuance of bonds, notes, coupons or other evidence of indebtedness which have been lost, destroyed, damaged or mutilated, and past due bonds.
Only those registered voters residing within the boundaries of the special service district shall be entitled to vote on the proposition for the incurring of a bonded indebtedness. The favorable vote of three-fifths of all the voters voting on the proposition to authorize the issuance of bonds at the election held pursuant to Section 29701 within the special service district as finally established is required to authorize the issuance of the bonds.
Any proceedings denying the validity of the creation of any special service district, or of any bonds authorized by the voters thereof, pursuant to this part, shall be brought within three months after the date upon which the applicable proposition is approved by the voters.
ARTICLE 6. Annexation [29710. - 29727.]
Any territory within the boundaries of the district not included within the boundaries of the special service district to which it is proposed to be annexed, may be annexed thereto in the manner provided in this article; provided that no city shall be divided in the annexation of territory to a special service district.
The board shall by resolution determine that the annexation of the territory will facilitate the acquisition or operation of transit facilities for the special service district, describe the territory, declare its intention to annex the territory to the special service district, set forth the terms and conditions upon which the territory shall be annexed, fix the time and place for hearing on the question of the annexation and provide for notice of the hearing.
Any public agency or portion thereof included as part of the territory proposed to be annexed to a special service district pursuant to this article may, by resolution of its legislative body, or a petition of its voters filed with the secretary of the district prior to the hearing on annexation, require the submission of an annexation proposition to the voters of the public agency, or portion thereof. However, no election shall be held if the board, pursuant to Section 29719, excludes from the territory to be annexed the public agency, or portion thereof, proposed to be annexed in accordance with its resolution or petition.
The petition for election provided for in Section 29712 shall be signed by voters within any public agency, or portion thereof, included within the boundaries of the territory proposed to be annexed equal in number to at least 10 percent of the registered voters residing within such public agency, or portion thereof. The petition may include one or more documents, but each document shall contain the affidavit of the party who circulated it certifying that each name affixed thereto is the true signature of the person whose name it purports to be.
The secretary of the district shall compare the signatures with the affidavits of registration on file with the county elections official, and shall certify to the board as to the sufficiency or insufficiency of the petition.
The terms and conditions for the annexation of territory to a special service district may provide, among other matters, for the payment of taxes within the territory to be annexed, in addition to the taxes otherwise provided for in this part, the fixing of rates, rentals, and charges differing from those fixed or existing elsewhere, within the special service district, the making of a payment or payments, or the transfer of property, real and personal, and other assets to the district by the territory proposed to be annexed.
Notice fixing the time and place for hearing on the question of the annexation of territory to a special service district shall be published once in a newspaper of general circulation published in the district. The board, in its discretion, may give such additional notice as it deems desirable.
The time of hearing shall be not less than 20 nor more than 60 days from the date of the publication of the notice.
At or before the hearing, any person interested may file with the secretary of the district written objections to the annexation of the territory to the special service district or to the inclusion of his property. Upon the hearing the board shall hear and determine all protests and objections.
The hearing may be continued from time to time by the board without further notice other than an order entered upon the minutes of its meeting fixing the time and place of the continued hearing. In the event that no protests are filed, or the protests filed are overruled and denied, and no election is to be held, the board shall, by resolution, declare the territory, or a portion thereof, annexed to the special service district.
If the board finds that protest has been made, prior to the board’s final determination for annexation, by the owners of real property within the area to be annexed the assessed value of which, as shown by the last equalized assessment roll, constitutes more than one-half of the total assessed value of the real property within the area to be annexed, the proceeding shall terminate. The board shall order the proceedings terminated when such protests are received.
From and after the date of filing of the resolution with the secretary of the district, the annexation of the territory, or portion thereof, to the special service district is complete.
If an election is required to be held, pursuant to the provisions of Section 29712, the board shall call such election within 60 days after the petition or resolution is filed with the secretary of the district; provided that if a general election is to be held within the petitioning public agency within 120 days after the petition or resolution is filed with the secretary of the district, the board may consolidate the election required by this article with the general election.
The ballot for the election shall contain such instructions as are required by law to be printed thereon and in addition thereto the following:
No person is entitled to vote at the election unless he is a voter of the public agency, or portion thereof, requesting the election. The election may be held on the same day as any other state, county or city election and may be consolidated.
The costs of the election required by this article shall be borne by the district.
The question of the annexation of territory to a special service district shall be canvassed separately for each public agency, or portion thereof, in which an election is held, and the board shall order and declare the territory annexed to the special service district in each public agency, or portion thereof, in which an election is held and in which a majority of those who voted upon the proposition of annexation of territory to the special service district voted in favor of the proposition, and excluding each public agency, or portion thereof, in which an election was held and in which a majority of those who voted upon the proposition of the annexation of territory to the special service district voted against the proposition.
Upon the completion of the annexation of any territory, in accordance with law, to any city included in a special service district, the city clerk shall file with the secretary of the district a certified copy of the ordinance, resolution or other document completing said annexation containing a description of the property so annexed. Unless the district within 90 days after such filing shall file with the city clerk the district’s written objections to the annexation to the special service district of said territory, such territory shall, upon the termination of such period, be deemed incorporated into and annexed to the special service district, and thereafter is subject to taxation along with the entire territory of the special service district in accordance with the assessable valuation of the property thereof for special service district purposes, and for the payment of any indebtedness theretofore or thereafter incurred by the special service district.
If the district shall file its objections, in the manner provided in Section 29726, to the annexation to a special service district of territory annexed to a city included in a special service district, the territory shall not be annexed to the special service district, except in the manner heretofore provided in this Article 6 (commencing with Section 29710). The district may withdraw such objections by filing with the city clerk a certified copy of a resolution of the board stating that such objections are withdrawn. Thereupon such territory shall be deemed incorporated into and annexed to the special service district, as provided in Section 29726.
ARTICLE 7. Dissolution [29740. - 29740.]
A special service district may be dissolved by resolution of the board if any proposition for the incurring of a bonded indebtedness fails to carry, and if the special service district is then subject to no other indebtedness or liability pursuant to this part and has been organized for not less than two years. Dissolution of a special service district shall not prevent subsequent proceedings for the creation of a special service district including the same or any part of the area of the special service district dissolved.
CHAPTER 11. Dissolution [29750. - 29757.]
If district bonds for the acquisition or construction of rapid transit facilities have not been voted by the electors within five years of the creation of the district, the board of directors may call an election for the purpose of submitting to the voters of the district the question of whether the district will be dissolved. Upon the filing with the secretary of the district of a petition signed by voters within the district equal in number to at least 25 percent of the total vote cast in the district for all candidates for Governor at the last preceding general election at which a Governor was elected, asking that the question of dissolution of the district be submitted to the voters of the district, the board shall call an election for that purpose.
The election, for the purpose of submitting to the voters of the district the question of whether or not the district shall be dissolved, shall be held within 60 days following the date on which it is ordered by the board or on which the petition is filed.
Notice of any election for dissolution, whether called because of the filing of a petition or ordered by the board without petition, shall be published. The date fixed for the election shall not be less than 30 days from the date of the first publication of the notice.
The ballots for the election shall contain substantially the instructions required to be printed on ballots for use at general state and county elections and in addition the following:
No other notice of the election other than that provided for in this article need be given and no sample ballots need be sent to the voters.
If upon a canvass of the election it is found that a majority of all votes cast on the proposition at the election were in favor of the dissolution, the dissolution shall be deemed carried and approved by the voters. The board shall meet on Monday next succeeding the election and canvass the votes cast.
If a majority of the qualified electors voting at said election vote in favor of such dissolution, the board of directors shall, by resolution entered upon its minutes, declare the district dissolved. A certified copy of said resolution shall be filed with the county and city and county recorders and with the Secretary of State and also with the county and city and county assessors and the State Board of Equalization. Upon the adoption of said resolution, said district shall be dissolved. The board of directors, if dissolution is voted, shall wind up the affairs of the district and pay all indebtedness thereof, and any moneys remaining thereafter shall be paid over to the counties, city and county and cities, in which the district lies, in proportion to the assessed valuation of taxable property in said city and county and cities and in the unincorporated area of the counties included in the district, as shown by the assessment rolls of the city and county and counties last equalized at the date of such dissolution.
In the event that the proposition for dissolution fails to carry, no subsequent election for the dissolution of the district shall be called until after the expiration of one year from the date of the prior election.
PART 3. SOUTHERN CALIFORNIA RAPID TRANSIT DISTRICT [30000. - 33021.]
CHAPTER 1. General Provisions and Definitions [30000. - 30007.]
This part shall be known as the Southern California Rapid Transit District Law.
The Legislature hereby finds and declares:
There is an imperative need for a comprehensive mass rapid transit system in the southern California area, and particularly in Los Angeles County. Diminution of congestion on the streets and highways in Los Angeles will facilitate passage of all Californians motoring through the most populous area of this state and will especially benefit domiciliaries of that county who reside both within and without the rapid transit district. It is, further, the declared policy of the state to foster the development of trade and the movement of people in and around the Los Angeles area for the benefit of the entire state, and one of the purposes of the Southern California Rapid Transit District is to further this policy.
In view of the limited powers of the Los Angeles Metropolitan Transit Authority (herein sometimes referred to as “authority”) it has become apparent that the authority is unable to solve the transit problems of the southern California area and provide the needed comprehensive mass rapid transit system.
It is, therefore, necessary to provide a successor corporation to the authority, to wit: a transit district, and to establish such transit district governed by representatives of the governmental agencies in the southern California area so that there will be sufficient power and authority to solve the transportation problems in the southern California area and to provide the needed comprehensive mass rapid transit system.
It is evident, therefore, that such a transit district may plan to meet the transit needs and problems of the whole southern California area; and that the estimates of future population growth for the southern California area make it imperative that a comprehensive plan for rapid transit contain projections of population trends extending over the next 30 years.
The part shall be liberally construed to carry out the objects and purposes and the declared policy of the State of California as in this part set forth.
Unless the context otherwise requires, the provisions of this chapter govern the construction of this part.
“District,” as used in this part, means the Southern California Rapid Transit District.
“Rapid transit,” as used in this part, means the transportation of passengers only and their incidental baggage by means other than by chartered bus, sightseeing bus, taxi, or any other motor vehicle not on an individual passenger fare paying basis, except as otherwise provided in subdivision (b).
This section does not prohibit the district from doing any of the following:
Leasing its buses to private certified public carriers.
Providing school bus service for the transportation of pupils between their homes and schools.
Providing charter bus services to governmental agencies, if comparable service is unavailable through privately operated bus companies, and to special events, other than regular and preseason scheduled professional and amateur sporting events.
Notwithstanding subdivision (a) or paragraph (3) of subdivision (b), this section does not prohibit the district from providing charter bus services, which are incidental to the holding of the 2026 FIFA World Cup in the County of Los Angeles, to any party or to any event during the period from June 1, 2026, to July 31, 2026, inclusive, if the district complies with all of the requirements set forth in subdivision (b) of Section 30630.5.
“Board of directors,” “board,” or “directors,” as used in this part, means the board of directors of the district.
“Public agency,” as used in this part, includes the State of California, and any county, city and county, city, district, or other political subdivision or public entity of, or organized under the laws of, this State.
CHAPTER 2. Creation of District [30100. - 30101.]
There is hereby created the Southern California Rapid Transit District, comprising that territory hereinafter described in this section lying within the boundaries of the County of Los Angeles and such territory in the County of Los Angeles and in other counties as may be hereafter annexed to the district as provided in this part. The territory within the County of Los Angeles which is hereby created into such district is described as follows:
All that portion of the County of Los Angeles, State of California, lying southerly of the line formed by the south lines of Sections 13, 14, 15, 16, 17, and 18 of Township 3 North, Range 15 West S.B.B. & M., the south lines of Sections 13, 14, 15, 16, 17, and 18 of Township 3 North, Range 16 West S.B.B. & M., the west line of Range 16 West S.B.B. & M., and the south lines of Sections 13 and 14 of Township 3 North, Range 17 West S.B.B. & M., and the westerly extension of such lines in the Rancho Simi to the westerly boundary of the County of Los Angeles, and westerly of the east line of Range 15 West S.B.B. & M., and all that portion of the remainder of said county lying southerly of the north line of Township 2 North S.B.B. & M., excepting therefrom the islands of Santa Catalina and San Clemente.
The district created in accordance with the provisions of this part is a public corporation created for the purposes set forth in this part.
CHAPTER 3. Government of District [30200. - 30336.]
ARTICLE 1. Board of Directors [30200. - 30227.]
All powers, privileges and duties vested in or imposed upon the district shall be exercised and performed by and through a board of directors; provided, however, that the exercise of any and all executive, administrative, and ministerial power may be delegated and redelegated by the board of directors to any of the offices and officers created pursuant to this part or created by the board of directors acting pursuant to this part.
The board of directors shall consist of 11 members appointed as follows:
Five by the Board of Supervisors of the County of Los Angeles, who, in the discretion of such board of supervisors, may or may not be members of such board of supervisors, but each of whom shall be a resident of a different supervisorial district.
Two by the Mayor of the City of Los Angeles, subject to confirmation by the City Council of the City of Los Angeles, who may or may not be members of such city council, but each of whom shall be a resident of such city.
Four by the city selection committee, each of whom, in the discretion of such committee, may or may not be a member of the city selection committee, but who shall be an elected city official, shall be a resident of a different city, and shall not be a resident of the City of Los Angeles. The city selection committee shall adopt rules and regulations grouping or combining the areas of the cities within the district, except the City of Los Angeles, into four corridors based on existing or proposed transit lines. The rules and regulations shall provide that the member of the board to be selected by a subcommittee of the city selection committee shall be a resident of the corridor represented by the subcommittee. The terms of office of these four members of the board shall be for four years. On and after January 1, 1977, any appointment to the board shall be made by a subcommittee of the committee, which subcommittee shall include only members representing those cities within the corridor that the previous director represented. The appointment of a subcommittee shall be deemed approved by the city selection committee unless rejected by a two-thirds vote of the committee within 30 days of the appointment. If the appointment is so rejected, the subcommittee shall make another appointment.
Notwithstanding Section 30201, if a director appointed by the Mayor of the City of Los Angeles is a member of the city council of that city, confirmation by the city council is not required. If a director appointed by the mayor is not a member of the city council, the person appointed may serve for 60 days without confirmation.
At its first regular meeting after the effective date of this part, the Board of Supervisors of the County of Los Angeles shall appoint as members of the first board of directors of the district the number to be appointed by it under Section 30201.
At its first regular meeting after the effective date of this part, the Mayor of the City of Los Angeles, subject to confirmation by the City Council of the City of Los Angeles, shall appoint as members of the first board of directors of the district the number to be appointed by it under Section 30201.
Each member of the board of directors appointed by the Board of Supervisors of the County of Los Angeles, shall serve at the pleasure of the appointing body. Each member of the board of directors appointed by the Mayor of the City of Los Angeles, subject to confirmation by the City Council of the City of Los Angeles, may be removed at any time thereafter by following the same procedure used for appointment. If he is a member of the Board of Supervisors of the County of Los Angeles or the City Council of the City of Los Angeles and his term of office as a member of such bodies terminates, a vacancy is automatically created in his office as a member of the board of directors. If he is not a member of such bodies his term of office shall terminate at the end of his term as director.
Each director appointed by the Board of Supervisors of the County of Los Angeles shall be appointed by resolution, and each director appointed by the Mayor of the City of Los Angeles, subject to confirmation by the City Council of the City of Los Angeles, shall be confirmed by resolution, and certified copies of the resolutions, together with notices of appointments made thereby, shall be forwarded without delay to the secretary of the district and to the County Clerk of Los Angeles County.
Any vacancy in the members of the board of directors appointed by the County of Los Angeles or by the City of Los Angeles shall be filled by appointment in the same manner as the appointment was made to the office in which the vacancy exists, in the manner provided in this part.
A city selection committee shall be established which shall consist of one member representing each city within the district as described in Section 30100, except the City of Los Angeles. Each member of the city selection committee shall serve without compensation from the district and shall be designated and appointed by and be a member of the governing body of the city they represent. As a member of the city selection committee, each member shall be entitled to vote on all motions coming before the committee or subcommittee thereof of which that member is a member, and shall be entitled to cast one vote for each 10,000, or major fractional part thereof, of population in the city represented by the member as shown by the latest population estimate prepared by the Demographic Research Unit of the Department of Finance pursuant to Section 2227 of the Revenue and Taxation Code; provided, that each member shall have at least one vote and no city shall have votes exceeding in number the total number of votes of all the other cities represented on the committee. For the purposes of this section, the term “major fractional part” means a fractional part larger than one-half.
On or before the second Monday which is not a holiday following the effective date of this part, the governing body of each city within the district, except the City of Los Angeles, shall appoint from among its members, to serve as members of the city selection committee, the number of members of the city selection committee to be appointed by it under Section 30207.
Each member of the city selection committee shall serve at the pleasure of the governing body of the city by which he was appointed. If his term of office as a member of such appointing body terminates, a vacancy is automatically created in his office as a member of the city selection committee, and also as a member of the board of directors, if he is so serving.
Each member of the city selection committee shall be appointed by a resolution adopted by the governing body of the appointing body. Certified copies of all resolutions of appointment, together with notices of appointment made thereby, shall be forwarded without delay to the secretary of the district.
Any vacancy in the city selection committee shall be filled by appointment by the body which originally made the appointment to the office in which the vacancy exists, in the manner provided in this part.
No person serving as a member of the city selection committee shall be eligible for appointment to any salaried office or employment in the service of the district nor shall he become eligible for such appointment within one (1) year after he has ceased to be a member of the city selection committee; provided, however, that, as provided in this part, members of the city selection committee may serve as directors of the district.
The county auditor shall furnish the necessary certificates as to assessed valuation to enable the city selection committee to function.
All meetings of the city selection committee shall be conducted pursuant to the Ralph M. Brown Act, Chapter 9 (commencing with Section 54950) of Part 1, Division 2, Title 5 of the Government Code.
The presence of members of the city selection committee representing more than fifty (50) percent of the total number of votes of all the members of the city selection committee shall constitute a quorum.
The affirmative votes of members representing more than fifty (50) percent of the total number of votes of all the members of the city selection committee shall be necessary and, except as otherwise provided in this part, shall be sufficient to carry any motion coming before the city selection committee.
Within ten (10) days after the Secretary of State has received certified copies of the resolutions appointing a majority of the city selection committee, he shall call the first meeting of the city selection committee to be held not less than twenty (20) days thereafter at an appropriate time and place. The meeting shall be held in any city within the district designated by the Secretary of State, and may be adjourned from time to time or to a different place as determined by a majority of the total number of votes of all members present whether there be a quorum or less than a quorum.
The city selection committee shall appoint from its members a chairman and such other officers as may be necessary. Until a chairman is appointed, the Secretary of State, or his deputy, shall act as chairman.
The city selection committee shall appoint as members the number to be appointed by it under Section 30201 as the first board of directors of the district. All such appointments shall be completed within ten (10) days after the first meeting called by the Secretary of State.
Members of the board of directors who are not members of the Board of Supervisors of the County of Los Angeles or members of the City Council of the City of Los Angeles shall, at the first meeting of the board of directors be assigned by lot so far as possible staggered terms of one, two, three and four years in that order and thereafter the terms of such members of the board of directors shall be four years.
Whenever a vacancy occurs in the member of the board appointed by a subcommittee of the city selection committee, the vacancy shall be filled by that subcommittee. The subcommittee shall meet within 30 days following the occurrence to appoint a director to fill the vacancy. The board shall determine promptly the time and place of the meeting of the subcommittee and shall give the members at least 10 days notice thereof. Whenever there shall not be quorum present at the meeting of the subcommittee, the meeting shall be adjourned to a subsequent time and place as determined by a majority of the total number of votes present.
The appointment of the subcommittee shall be deemed approved by the city selection committee unless rejected by a two-thirds vote of the committee within 30 days of the appointment. If the appointment is so rejected, the subcommittee shall make another appointment.
An appointment to fill a vacancy shall be for the unexpired portion of the term.
The city selection committee shall meet within 45 days after receiving the latest population estimate prepared by the Demographic Research Unit of the Department of Finance pursuant to Section 2227 of the Revenue and Taxation Code (1) to determine the number of votes each member is entitled to cast and (2) to enable each subcommittee of the committee to appoint a member to the board on the basis of the newly determined number of votes each member is entitled to cast; provided, however, that nothing herein shall prevent the reappointment of directors who are currently serving or who have served previously. The board shall determine the time and place of the meeting of the city selection committee and shall give the members at least 10 days’ notice thereof. Whenever there shall not be a quorum present at the meeting of the city selection committee, the meeting shall be adjourned to a subsequent time and place as determined by a majority of the total number of votes present.
Upon petition signed by members of the city selection committee representing more than two-thirds (23) of the total number of votes of all the members of the city selection committee, the city selection committee shall meet for the purpose of considering the recall of any member of the board of directors appointed by the city selection committee and named in such petition. The board of directors shall determine promptly the time and place of the meeting of the city selection committee and shall give the members at least ten (10) days notice thereof. Whenever there shall not be a quorum present at the meeting of the city selection committee the meeting shall be adjourned to a subsequent time and place as determined by a majority of the total number of votes present. If at such meeting another person is appointed in place of the person named in the petition such person shall be deemed to be recalled and the vacancy created thereby shall be filled by the new member thus appointed.
Members of the board of directors shall serve until their respective successors are appointed and qualified.
Except as provided in Section 30251 of this part, no person serving as a director shall be eligible for appointment to any salaried office or employment in the service of the district nor shall he become eligible for such appointment or employment within one (1) year after he has ceased to be a director.
In order to provide orderly transition from the Los Angeles Metropolitan Transit Authority (herein sometimes referred to as “authority”) to the district, it may be desirable for a member or members or former member or members of the authority to serve or continue to serve as a member or members of the board of directors of the district and nothing in this part shall prevent each one of the three appointing bodies from each appointing a member or members of the authority as a member or members of the board of directors of the district if the appointing body involved, in its discretion, wishes so to do.
Within ten (10) days after the Secretary of State has received certified copies of the resolutions appointing a majority of the directors, he shall call the first meeting of the board of directors at an appropriate time within twenty (20) days thereafter. The meeting shall be held in the City of Los Angeles.
ARTICLE 3. Powers and Duties of Directors [30250. - 30264.]
Each director, before entering upon the duties of his office, shall take the oath of office. The oath shall be filed with the Secretary of State and a copy thereof with the secretary of the district.
The board of directors is the legislative body of the district and, consistent with the provisions of this part, shall determine all questions of district policy.
The board may contract and take any and all actions and proceedings and do any and all other things necessary to carry out the purposes of this part.
The board shall determine what transit facilities should be acquired, constructed, developed, jointly developed, leased, or disposed of, by means including, but not limited to, lease, sale, purchase, option, gift, devise, condemnation, grant, or otherwise.
In order to provide orderly transition from the Los Angeles Metropolitan Transit Authority (herein sometimes referred to as “authority”) to the district, it may be desirable for certain members or former members of the authority or the officers, advisors and staff thereof, or both, to serve in an advisory capacity to the board. The board may, in its discretion, establish an advisory board of the above-named persons or any others that it sees fit, provided that each member of such advisory board shall consent to serve and also that there shall be no compensation paid by the district to members of such advisory board.
The board shall supervise and regulate every transit facility owned and operated by the district, including the fixing of rates, fares, rentals, charges, and classifications thereof, and the making and enforcement of rules, regulations, contracts, practices, and schedules, for or in connection with any transit facility owned or controlled by the district.
Subject to the provisions of Article 10 (commencing with Section 30750), Chapter 5 of this part, the board may adopt a personnel system for the purpose of recruiting and maintaining an effective working force with good morale. The board shall by resolution determine and create such number and character of positions as are necessary properly to carry on the functions of the district. The board shall establish an appropriate salary, salary range, or wage for each position so created, except for positions in a bargaining unit represented by a labor organization. The board may also establish health and other fringe benefits. The board may by resolution abolish any such position. Except as otherwise provided in this part, appointments to such positions shall be made by the general manager.
The board may contract for or employ any professional services required by the district or for the performance of work or services for the district which, in the opinion of the board, cannot satisfactorily be performed by the officers or employees of the district.
The board shall have an annual audit made of all books and accounts of the district by an independent certified public accountant or public accountant.
As soon as practicable after the close of each fiscal year the board shall submit to the chief administrative officers and legislative bodies of cities and counties within the district a financial report showing the result of operations during the preceding fiscal year and the financial status of the district on the final day thereof. Copies of the report shall be supplied to the general public upon request in the quantity deemed appropriate by the board.
The board may provide by resolution, under such terms and conditions as it sees fit, for the payment of demands against the district without prior specific approval thereof by the board if the demand is for a purpose for which an expenditure has been previously approved by the board and in an amount no greater than the amount so authorized, and if the demand is approved by the general manager or such other officer or deputy as the board may prescribe.
To facilitate the business of the district, the board may provide for the creation and administration of such funds as the needs of the district may require. The funds shall be disbursed in accordance with rules established by the board and all payments from any fund shall be reported to the board.
The board may hold public hearings, subpoena witnesses, and perform all other acts necessary to properly carry out its duties. The board may delegate such authority to other officers of the district who shall report thereon to the board.
Each director may administer oaths and affirmations in any district investigation or proceeding.
ARTICLE 4. Meetings and Legislation [30270. - 30275.]
All meetings of the board of directors shall be conducted pursuant to the Ralph M. Brown Act, Chapter 9 (commencing with Section 54950) of Part 1, Division 2, Title 5 of the Government Code.
The affirmative votes of a majority of the members of the board shall be necessary and, except as otherwise provided in this part, shall be sufficient to carry any order, resolution, or ordinance coming before the board of directors.
The board shall adopt rules for the general conduct of its proceedings including, without limitation, penalties for unexcused absence from meetings.
The acts of the board shall be expressed by motion, resolution, or ordinance. No ordinance shall be passed by the board on the day of its introduction, nor within five days thereafter, nor at any time other than a regular or adjourned regular meeting. No ordinance shall take effect until the expiration of 30 days following its adoption, unless otherwise provided in this part.
The following ordinances shall take effect upon adoption:
An ordinance relating to an election, or to the issuance or sale of bonds, or to the levying or collection of taxes, or the fixing of fares.
An ordinance necessary for the immediate preservation or protection of the property, interests, or welfare of the district, which shall contain a specific statement showing its urgency, passed by two-thirds of the votes of all of the members of the board.
All ordinances except those which take effect upon their adoption shall be subject to referendum as provided in Section 30741.
The enacting clause of all ordinances shall be as follows: “Be it ordained by the Board of Directors of the Southern California Rapid Transit District:”
All ordinances shall be signed by the president or the vice president of the board and attested by the secretary. All ordinances shall be published once within 15 days after passage in a newspaper of general circulation printed and published in the district.
ARTICLE 5. Officers [30300. - 30308.]
The officers of the district shall consist of the members of the board of directors; a president and a vice president of the board, each of whom shall be a member of the board; a secretary, a general manager, a general counsel, a treasurer, an auditor, and such other or subordinate officers, assistants, and deputies as the board may deem necessary and provide for by ordinance or resolution.
The secretary, general manager, general counsel, treasurer, and auditor shall be full-time officers and shall be appointed by and may be removed by the affirmative votes of a majority of the members of the board. All other officers and employees shall be appointed by the general manager and shall serve at his pleasure, subject to the provisions of this part relating to personnel.
The compensation of all district officers and employees, except as otherwise provided in this part, shall be fixed by ordinance or resolution of the directors.
The general counsel shall be a person admitted to practice law in the Supreme Court of California and shall have been actively engaged in the practice of law for not less than seven (7) years next preceding his appointment.
The person appointed auditor shall have been actively engaged in the practice of accounting for not less than seven (7) years next preceding his appointment.
The oath of office of all officers appointed by the board of directors or by the general manager of the district shall be taken, subscribed, and filed with the secretary of the district at any time after the officer has notice of his appointment but not later than fifteen (15) days after the commencement of his term of office. No other filing is required.
The board may require officers, assistants, deputies and employees to give bonds and may fix the amount thereof.
Article 4 (commencing with Section 1090), Chapter 1, Division 4, Title 1, of the Government Code shall apply to all officers and contracts of the district.
The treasurer shall be the custodian of the funds of the district and shall make payments only upon warrants duly and regularly signed by the president or vice president of the board, or other person authorized by the board so to do, and by the secretary or general manager. He shall keep an account of all receipts and disbursements.
The district may designate the treasurer and the auditor of the County of Los Angeles as treasurer and auditor of the district and the treasury of that county may be designated the depositary for district funds for such time as the board may determine.
ARTICLE 6. General Manager [30330. - 30336.]
The board shall appoint and fix the salary of a general manager, who shall have full charge of the acquisition, construction, development, joint development, maintenance, operation, leasing, and disposition of the facilities of the district and also of the administration of the business affairs of the district.
All other things being equal, the general manager shall be chosen on the basis of his qualifications with special reference to his actual experience in or his knowledge of accepted practices in respect to the duties of his office as hereinafter set forth.
The general manager need not be a resident of this State at the time of his appointment.
The general manager shall hold office for an indefinite term and may be removed by the board upon the adoption of a resolution by the affirmative vote of a majority of all members of the board. Before the general manager may be removed, he shall, if he demands it, be given a written statement of the reasons alleged for his removal and he shall have the right to be publicly heard thereon at a meeting of the board prior to the final vote on the resolution providing for his removal, but pending and during such hearing the board may suspend him from office. The board may not reduce the salary of the general manager below the amount fixed at the time of his original appointment except upon the adoption of a resolution by a like vote and after a like opportunity to be heard. The action of the board in suspending or removing the general manager or reducing his salary is final.
The powers and duties of the general manager are:
To have full charge of the acquisition, construction, development, joint development, maintenance, operation, leasing, and disposition of the facilities of the district.
To have full charge of the administration of the business affairs of the district.
To see that all ordinances of the district are enforced.
To administer the personnel system and collective bargaining agreements adopted by the board and, except for officers appointed by the board, to appoint, discipline, or remove all officers and employees subject to the rules and regulations adopted by the board and the applicable provisions of this part or the terms and conditions contained in any applicable collective bargaining agreement.
To prepare and submit to the board, as soon as practical after the end of each fiscal year, a complete report of the finances and administrative activities of the district for the preceding year.
To keep the board advised as to the needs of the district.
To prepare, or cause to be prepared, all plans and specifications for the construction of the works of the district.
To devote the manager’s entire time to the business of the district.
To cause to be installed and maintained a system of auditing and accounting which shall completely, and at all times, show the financial condition of the district.
To perform other and additional duties that the board may require.
The general manager shall attend meetings of the board and be entitled to participate in the deliberations of the board, but shall not have a vote as to any matter before the board.
The directors may appoint a general manager pro tempore to serve during any absence or disability of the general manager.
CHAPTER 4. Retirement System and Employment Benefits [30400. - 30471.]
ARTICLE 1. Establishment [30400. - 30406.]
The board may establish a retirement system for the officers and employees of the district and provide for the payment of annuities, pensions, retirement allowances, disability payments, and death benefits or any of them.
The district may maintain its own retirement fund or may provide for benefits to eligible officers and employees, or their beneficiaries, by means of group insurance or other insurance, or by such means as in the opinion of the board will satisfactorily provide an adequate and sure method of meeting the payments contemplated by the retirement system.
Before establishing any retirement system the board shall secure a report from a qualified actuary, which shall show the cost of the benefits provided by the system, and the prospective assets and liabilities of the system.
The board may adopt all ordinances and resolutions and perform all acts necessary or convenient to the initiation, maintenance, and administration of the retirement system.
As an alternative method of providing a retirement system the board may contract with the Board of Administration of the Public Employees’ Retirement System and enter all or any portion of its employees under such system pursuant to law and under the terms and conditions of such contract, or may contract with the Board of Administration of the Public Employees’ Retirement System for reciprocal benefits between the Public Employees’ System, or a city, or city and county, or any other public agency contracting with the Public Employees’ Retirement System and the district’s retirement system as authorized by Section 20042 of the Government Code, and may perform all acts necessary or convenient to provide for such reciprocal benefits.
The board may also contract with the Board of Administration of the State Employees’ Retirement System for participation in the Federal Social Security Act and may perform all acts necessary or convenient for such participation.
The board may classify and determine the officers and employees who shall be included as members in the retirement system and may change the classification from time to time. Membership of all officers and employees so classified and included in the retirement system is compulsory.
ARTICLE 2. Benefits and Contributions [30430. - 30433.]
The board may prescribe the terms and conditions upon which the officers and employees of the district or their beneficiaries shall be entitled to benefits and the amounts thereof.
Any pension or retirement system adopted shall be on a sound actuarial basis and provide for contributions by both the district and the employee members of the system which shall be based on percentage of pay roll to be changed only by adjustments on account of experience under the system.
Contributions shall be in amounts which will accumulate at retirement a fund sufficient to carry out the promise to pay benefits to the individual on account of his service as a member of the system, without further contributions from any source.
Nothing in any pension or retirement system or plan shall prevent the board from, at any time, amending, changing, modifying or terminating any provision for benefits, participation, or contributions thereto or thereunder.
ARTICLE 3. Employees Under Bargaining Agreements [30450. - 30451.]
The adoption, terms, and conditions of the retirement systems covering employees of the district in a bargaining unit represented by a labor organization shall be pursuant to a collective bargaining agreement between such labor organization and the district. Any such retirement system adopted pursuant to a collective bargaining agreement shall be on a sound actuarial basis. The district and the labor organization representing the district’s employees in a bargaining unit shall be equally represented in the administration of such retirement system.
ARTICLE 4. Other Benefits [30470. - 30471.]
The district shall take such steps as may be necessary to obtain coverage of its employees under Title 2 of the Federal Social Security Act, as amended, and the related provisions of the Federal Insurance Contributions Act, as amended.
The district shall take such steps as may be necessary to obtain coverage for the district and its employees under the state laws relating to workers’ compensation and insurance, unemployment compensation, and disability compensation.
CHAPTER 5. Powers and Functions of District [30500. - 30756.]
ARTICLE 1. Corporate Power [30500. - 30507.]
The district has perpetual succession and may adopt a seal and alter it at pleasure.
The district and its officers may sue and be sued in all actions and proceedings, in all courts and tribunals of competent jurisdiction.
The district may levy, and collect or cause to be collected, taxes for any lawful purpose, as provided in Chapter 6 (commencing with Section 30800) of this part.
The district may exercise the right of eminent domain within the boundaries of the district to take any property necessary, incidental, or convenient to the exercise of the powers granted in this part.
The district is authorized to maintain a suitable security force comprised of transit police officers and security guards. Persons designated as transit police officers are peace officers pursuant to Section 830.33 of the Penal Code. The district shall adhere to the standards for recruitment and training of peace officers established by the Commission on Peace Officer Standards and Training pursuant to Title 4 (commencing with Section 13500) of Part 4 of the Penal Code in the recruitment and training of its transit police officers. Every transit police officer employed by the district shall conform to the standards for peace officers of the Commission on Peace Officer Standards and Training and the commanding officer of the unit shall, not later than July 1, 1979, (1) have at least 10 years of active law enforcement experience in a capacity of employment requiring peace officer status and (2) have met the requirements for the advanced certificate of the Commission on Peace Officer Standards and Training, (3) have attended a POST-approved law enforcement management course, and (4) have an associate of arts degree or higher. Any such officer who fails to conform to such standards by July 1, 1979, shall not continue to have the powers of a peace officer.
The district is entitled to the benefit of any reservation or grant, in all cases, where any right has been reserved or granted to the State or any agency or political subdivision thereof or any public corporation to construct or maintain roads, highways or other crossings over any public or private lands.
The district may exercise any and all powers granted by any other law which by its terms is applicable to districts generally, to public corporations generally, or to any classification of districts or public corporations which includes a district of the type provided for in this part, but no such power shall be exercised contrary to any express provision of this part.
Prior to the time the district incurs any bonded indebtedness, the district shall insofar as possible follow the budgetary control procedures for counties, pursuant to Articles 1 to 8, inclusive (commencing with Section 29000), Chapter 1, Division 3, Title 3 of the Government Code. Transfers of funds within, or revisions of, a budget adopted by the district, whether before or after the incurring of any bonded indebtedness, may be made by appropriate act of the board at a regular, adjourned regular or special meeting. After the district incurs any bonded indebtedness the district shall establish suitable budgetary procedures and thereafter copies of each proposed annual budget shall be available to interested persons a reasonable time before the adoption thereof and copies of the final budget shall likewise be available to interested persons. Copies of any special budgets shall be furnished to interested parties on request.
ARTICLE 2. Contracts [30530. - 30536.]
The district may make contracts and enter into stipulations of any nature whatsoever, either in connection with eminent domain proceedings or otherwise, including, without limiting the generality of the foregoing, contracts and stipulations to indemnify and save harmless, and to do all acts necessary for, incidental to, or convenient for the full exercise of the powers granted in this part.
The district may contract with any department or agency of the United States of America or of the State of California or with any public or private corporation upon such terms and conditions as the directors find is for the best interests of the district.
The district may contract with any person, firm, corporation, association, organization, or other entity, public or private, for the acquisition, construction, development, joint development, maintenance, operation, leasing, and disposition of facilities of the district.
The district may insure against any accident to or destruction of the system or any part thereof.
The district may insure against loss of revenues from any cause whatsoever.
The district may insure against public liability or property damage, or both. It may provide in the proceedings authorizing the issuance of any bonds for the carrying of such or any other insurance, in such amount and of such character as may be specified, and for the payment of the premiums thereon.
Any bonds, notes, warrants and other evidences of indebtedness issued or incurred by the district shall be signed as provided in the section of this part applicable thereto or as provided in any other law applicable thereto; provided, however, that if the particular section or law does not prescribe the method of such execution, the method provided for bonds of the district shall apply so far as applicable. All other contracts of the district shall be executed on behalf of the district by the general manager; provided, however, that the board may, by resolution, fix any other method of executing such contracts.
ARTICLE 4. Property [30600. - 30600.]
The district may take by grant, purchase, gift, devise, or lease, or by condemnation, or otherwise acquire, and hold and enjoy, real and personal property of every kind within or without the district necessary or incidental to the full or convenient exercise of its powers. That property includes, but is not limited to, property necessary for, incidental to, or convenient for joint development and property physically or functionally related to rapid transit service or facilities. The board may lease, sell, jointly develop, or otherwise dispose of any real or personal property within or without the district when, in its judgment, it is for the best interests of the district so to do.
ARTICLE 5. Rapid Transit Facilities and Service [30630. - 30647.]
The district may provide a rapid transit system for the transportation of passengers and their incidental baggage.
Except as provided in subdivision (b), the district may operate charter bus service, subject to all of the following limitations:
Bus equipment that is designed solely for charter service shall not be purchased. A bus equipped with a toilet or underfloor baggage compartment shall be deemed to be bus equipment that is designed solely for charter service.
The board shall hold a public hearing before adopting a charter rate schedule or any amendment to the charter rate schedule. Notice of the hearing shall be mailed to each charter-party carrier operating within the district at least 30 days before the date of the hearing. The notice shall include the proposed charter rate schedule. At the close of the public hearing, the board may adopt charter rate schedules, which shall not be less than the average for the three largest private charter-party carriers operating similar service in the district.
Charter service operations by the district shall originate and terminate within the area served by the district, unless a private charter-party carrier requests the district to provide service beyond that area.
The district may provide charter bus service for the 2026 FIFA World Cup during the period from June 1, 2026, to July 31, 2026, inclusive, in the County of Los Angeles if all of the following conditions are met:
The district establishes a schedule of rates for charter bus services that are incidental to the holding of the 2026 FIFA World Cup in the County of Los Angeles subject to the following requirements:
The rates for charter-party bus services established under this paragraph are sufficient to pay all marginal costs related to those charter bus services and contribute financially to the reduction of deficits incurred by the district in the operation of scheduled route services.
The rates are at least equal to the average of the lowest rates charged by the three largest private charter-party carriers operating similar service in the County of Los Angeles.
The schedule of rates are effective from June 1, 2026, to July 31, 2026, inclusive.
The district provides charter bus service for the events to the extent that private charter-party carriers are not capable of providing that service.
The district provides charter bus service in compliance with paragraphs (1) and (3) of subdivision (a).
Other public transportation providers, operating under contract with the district, may provide charter bus service under this subdivision in the County of Los Angeles for the 2026 FIFA World Cup.
This subdivision does not override any collective bargaining agreement between the district or a public transportation provider operating under contract with the district and a labor organization that represents employees of those entities, as applicable, and does not authorize the district or a public transportation provider operating under contract with the district to provide charter bus service via contracting with private entities. Any charter bus service provided pursuant to this subdivision shall be operated by the district, or a public transportation provider operating under contract with the district, with employees of the entity providing the charter service.
For purposes of this subdivision, “not capable of providing that service” includes, but is not limited to, the inability to meet requirements including, but not limited to, requirements with regard to unique equipment, fuel type, number of doors, frequency, public safety, accommodations for standing passengers, handicap accessibility, or the nature of the service.
This subdivision shall become inoperative on January 1, 2027.
The district may acquire, construct, develop, lease, jointly develop, own, operate, maintain, control, use, jointly use, or dispose of rights-of-way, rail lines, monorails, buslines, stations, platforms, switches, yards, terminals, parking lots, air rights, land rights, development rights, entrances and exits, and any and all other facilities for, incidental to, necessary for, or convenient for rapid transit service, including, but not limited to, facilities and structures physically or functionally related to rapid transit service, within or partly without the district, underground, upon, or above the ground and under, upon, or over public street, highways, bridges, or other public ways or waterways, together with all physical structures necessary for, incidental to, or convenient for the access of persons and vehicles thereto, and may acquire, lease, sell, or otherwise contract with respect to any interest in or rights to the use or joint use of any or all of the foregoing. However, installations in state freeways are subject to the approval of the Department of Transportation and installations in other state highways are subject to Article 2 (commencing with Section 670) of Chapter 3 of Division 1 of the Streets and Highways Code.
The use of the streets, highways, freeways, and other public places by the district for any of the purposes permitted herein is presumed to be no greater burden on adjoining properties than the uses existing as of August 22, 1964. If facilities, other than state highways or freeways referred to above, (including, but not limited to, streets, highways, pipelines, sewers, water mains, storm drains, poles, communications wires, and electric transmission wires) of another public agency, of the state, or of a private owner are necessarily required to be relocated, replaced, or altered in order for the district to construct or operate its system, or if the construction or operation by the district of its system makes necessary the relocation, replacement, or alteration of any of those facilities of another public agency, of the state, or of a private owner in order to maintain the functioning of the facilities at their previous level of service, the facilities shall be relocated, replaced, or altered with reasonable promptness by the respective public corporation, state, or private owner and the district shall, by prior agreement, reimburse the public corporation, state, or private owner for the actual cost necessarily incurred in the relocation, replacement, or alteration.
The district may enter into an agreement with any city or county having jurisdiction over the street or highway involved, and, as may be provided in the agreement, may close any city street or county highway at or near the point of its interception with any district facility or may make provision for carrying the city street or county highway over or under or to a connection with the district facility and may do any and all work on the city street or county highway as is necessary therefor. No city street or county highway shall be closed, either directly or indirectly, by the construction of district facilities except pursuant to such an agreement or while temporarily necessary during the construction of district facilities if the district has first obtained a temporary street or highway closing permit.
The district may lease or contract for the use of its facilities, or any portion thereof, to any operator, and may provide for subleases by such operator upon such terms and conditions as it deems in the public interest. The word “operator” as used in this section means any city or public agency or any person, firm or private corporation engaged in the transportation of passengers for hire, properly holding a Public Utilities Commission approved and authorized certificate of public convenience and necessity for the transportation of passengers.
The district may construct, acquire, develop, jointly develop, maintain, operate, lease, and dispose of works and facilities in, under, upon, over, across, or along any road, street, alley, avenue, or public highway or any stream, bay, watercourse, or other public ways or waterways, or over any of the lands which are the property of the state, including, but not limited to, facilities and structures physically or functionally related to rapid transit service, to the same extent that those rights and privileges relating to public ways or waterways are granted to municipalities within the state for those uses or any other use or uses, including, but not limited to, those uses specified in Article 3 (commencing with Section 10101) of Chapter 1 of Division 5.
The district may enter into agreements for the joint use or joint development of any property or rights by the district and any city, public agency, or public utility operating transit facilities or nontransit facilities, or both, or any other person, firm, corporation, association, organization, or other entity, public or private, either, in whole or in part, within or outside the district, for the joint use or development of any property of the district or of the city, public agency, public utility, person, firm, corporation, association, organization, or other entity, public or private, or the establishment of through routes, joint fares, station cost-sharing, connector fees, or land, air, or development rights sales or leasing, transfer of passengers, pooling arrangements, or for any other purpose necessary for, incidental to, or convenient for the full exercise of the powers granted in this part. As to any service which the district is authorized to perform pursuant to this part, the district may contract for the performance of the service by any city, county, or public utility operating transit facilities, the territory of which is, in whole or in part, within the district.
“Joint development” includes, but is not limited to, agreements with any person, firm, corporation, association, organization, or other entity, public or private, to develop or to engage in the planning, financing, or construction of district facilities or development projects adjacent, or physically or functionally related, to district facilities.
Notwithstanding any other provision of this part, no joint development of nontransit facilities may be accomplished without the prior approval of the legislative body of the local jurisdiction within which the development is to take place.
“Transit facilities,” as used in this section, includes land, buildings, and equipment, or any interest therein, whether or not the operation thereof produces revenue, which have as their primary purpose the operation of a rail transit system or the providing of services to the passengers of a rail transit system.
“Nontransit facilities,” as used in this section, includes any land, buildings, or equipment, or interest therein, which is used primarily for the production of transit revenue not arising from the operation of a rail transit system.
The district may operate such feeder bus lines and other feeder services as necessary.
As soon as practicable after the effective date of this part, the board shall cause a preliminary report to be made as to a rapid transit service and system which shall include:
The estimated cost of the proposed acquisition, and construction and all incidental expenses connected therewith.
The probable sources of income from the system and the estimated amount thereof.
The estimated cost of maintenance and operation thereof.
The proposed method or methods of financing.
Any other information deemed pertinent, including, without limitation, a preliminary sketch or sketches, plan or plans or design of stations, platforms, terminals, structures and facilities constituting a method of rapid transit (all of the foregoing being hereafter referred to in this section by the word “facilities”), the proposed locations thereof and the proposed routes of the system.
The district shall, in connection with the studies necessary to determine the possible routes and locations for the said facilities, confer with the appropriate local governing bodies and other agencies that may be affected thereby and with their technical and planning personnel, obtaining where available any master or general plan in the affected areas.
The district shall give written notice of the preliminary report to each affected city or county that it may, within a period prescribed by the district (which period shall not be less than sixty (60) days), submit comments or evidence as to the effect that the design, location and routes of said facilities would have in their areas, including, without limitation, the effect upon property values, state and local facilities, and city street and county highway traffic.
When sufficient information has been accumulated to permit intelligent discussion, the district shall publicize and hold such public meeting or meetings as may be reasonably necessary to acquaint interested individuals, officials and civic or other groups with the studies made and the information developed and to obtain their views with respect to the preliminary report.
Using the information developed the district shall then prepare a final report containing the foregoing subdivisions (a) to (e) and such other matters deemed pertinent, including, without limitation, the information obtained at conferences and meetings, the relationship between all proposed routes and locations of such facilities and any master or general plans of the affected local agency or agencies and any information submitted by affected cities or counties pursuant to this section. The final report shall conclude with a recommendation as to the routes, location and design of such facilities.
The district shall serve written notice of the final report to each affected city or county that it may, within a period to be prescribed by the district (which period shall be not less than sixty (60) days), request a public hearing. Such notification shall include a statement that the district will hold a public hearing, if requested to do so by the governing body, within thirty (30) days following receipt of such written notification by the governing body; provided, however, that if, prior to receipt of such notification from the district, the governing body or bodies shall have, by resolution, declared that no public hearing by the district is necessary, then the notification by the district shall advise such governing body only of the intention of the district to consider the matter.
If any such governing body requests such hearing, the district shall hold a hearing, after public notice given in such manner as the district may determine, at which time and place all persons, and official bodies and other organizations interested in the matter, shall be afforded an opportunity to be heard. The district may also, on its own motion, call a public meeting or hold such hearings as it may deem appropriate. If no hearing is requested, the district may determine the routes, locations and design for the said facilities within the limits of the cities or counties to which the notice required by this section was given after the expiration of such period of thirty (30) days. If a hearing is requested, the district must determine the routes, location and design for said facilities within the limits of the cities or counties to which the notice required by this section was given within ninety (90) days after the first day on which such hearing is held.
This section is not intended to require in any report or reports made under the section prior to a bond election for the acquisition and construction of a line or lines or system (or such part thereof as the board determines to call a bond election on, and whether such report or reports be designated preliminary or final) detailed plans and specifications such as would be necessary for the acquisition and construction of the facilities or any part thereof, nor is it the intent of this section to prevent the district from taking advantage in the final plans and specifications of any technological advances, if the same occur, or from making changes due to additional information based on the results of surveys, experiments or tests.
Failure to comply in whole or part, or any defect in compliance with this section prior to a bond election, shall not affect the validity of the bond election or of the bonds, but as to any line to be acquired or constructed from the proceeds of the bonds this section must be substantially complied with prior to the expenditure of the proceeds of the bonds on such line, and no substantial change in any route theretofore determined following the procedure required by this section may be made without holding further hearings pursuant to notice given in such manner as the district may determine if the proposed change in the route is objected to by any city or county affected thereby.
In planning the development of a rapid transit system or any part thereof within its territory and in carrying out the provisions of Section 30001, the district may extend its studies to include any city or unincorporated area not within the territory of the district. The district may invite the participation in such studies of government agencies having planning jurisdiction in such extended areas, and the studies shall be coordinated with regional comprehensive and transportation planning programs. The district may accept and use for the purpose of rapid transit planning in such extended areas any funds provided for such purpose.
Not later than January 10, 1974, the district shall submit to the Legislature its plan for the implementation of a rapid transit system, and the financing thereof, in the district.
Prior to adding any new, or extending any existing, scheduled or regularly scheduled bus service, the district shall prepare a cost-benefit study of the proposed added or extended bus service.
The district shall not exercise control over any transit facilities now or hereafter owned and operated wholly or partly within, or without, the district by any city or public agency, unless by consent of such city or public agency and upon such terms as are mutually agreed upon between the board and such city or public agency.
The district shall not establish, construct, complete, acquire, operate, extend, or reroute (all of the foregoing being hereinafter referred to by the word “establish” in all forms thereof), directly or indirectly, either itself or by lease or contract with any other person or otherwise, any rapid transit service or system in such manner or form as will or may, either then or at any time in the future, divert, lessen, or compete for the patronage or revenues of the existing system of a publicly or privately owned public utility without the consent of the public utility, if the existing system has been in operation since at least August 1, 1974.
The maintenance and operation, but not the extension or rerouting, of any existing system acquired by the district from a publicly or privately owned public utility shall not be deemed to be the establishment of a rapid transit service or system within the meaning of this section.
The construction by the district of any structures constituting a method of rapid transit, and the operation therein and thereon of any equipment except buses, shall not be deemed to be the establishment, construction, completion, acquisition, operation, or extension of rapid transit within the meaning of this section.
No publicly owned public utility shall establish, construct, complete, acquire, or extend, directly or indirectly, either itself or by lease or contract with any other person or otherwise, any rapid transit service system in such manner or form as will then substantially divert or reduce the patronage or revenues of the system operated by the district. Any municipality may acquire and operate any existing transportation system within its existing transit service area without being in violation of this paragraph and may make route extensions to such system within its existing transit service area where such extensions do not compete with the established services of the district.
Nothing in this part shall be construed as in any way preventing or restricting the City of Los Angeles or any other city from exercising any powers which it has under Section 9 of Article XI of the California Constitution, including, without limitation, the establishing and operation of any point to point lines or system of rapid transit to operate in connection with any other transportation services established and operated by such city.
The rates, fees, and charges for service or rights furnished, leased, or otherwise transferred pursuant to this part, including, but not limited to, station cost-sharing, connector fees, and land or air rights sales or leasing, shall be fixed by a vote of two-thirds of all of the members of the board and shall be reasonable. Insofar as practicable, the rates, fees, and charges shall be determined and fixed so as to result in revenue which will make the transit system self-supporting and shall be sufficient to accomplish all of the following:
Pay the operating expenses of the district.
Provide for repairs, maintenance, and depreciation of works owned or operated by the district.
Provide for the purchase, lease, or acquisition of equipment under Article 3 (commencing with Section 30940) of Chapter 7.
Provide for the payment of the interest and principal of the bonded debt, subject to the applicable provisions of this part authorizing the issuance and retirement of bonds.
Provide for the payment of contracts, agreements, leases, equipment, trust certificates, and other legal liabilities assumed under Chapter 8 (commencing with Section 31000).
After making any current allocations of funds required for the purposes prescribed by pargraphs (1) to (5), inclusive, of subdivision (a) and by the terms of any indebtedness incurred under Article 1 (commencing with Section 30900), Article 2 (commencing with Section 30930), and Article 5 (commencing with Section 30960) of Chapter 7, the board may provide funds for any purpose the board deems necessary and desirable to carry out the purposes of this part.
This section does not constitute a covenant to the holders of any bonds or other evidences of indebtedness of the district unless the ordinance, resolution, or indenture providing for the issuance of those instruments so provides.
Notwithstanding Section 30638, all net income from fees, charges, rents, profits, or other net income arising from joint development of the property of the district which was acquired exclusively for the rail rapid transit system shall be used only for the following purposes:
Pay the capital and operating expenses of the rail rapid transit system.
Provide for the payment of interest and principal of the bonded debt for the rail rapid transit system, subject to the applicable provisions of this part authorizing the issuance and retirement of bonds.
Provide for the payment of contracts, agreements, leases, equipment, and other legal liabilities assumed under Chapter 8 (commencing with Section 31000).
As used in this section, “operating expenses” includes the expenses of operation, maintenance, and repair of all personal or real property physically or functionally related to rail rapid transit services or facilities.
The board of supervisors of a county, or the governing body of a city having territory located within the district may file a request for a hearing before the district board as to the reasonableness of any rates or charges fixed by the district and as to any proposal for fixing the location of facilities by the district. The request shall be in writing and shall state the subject matter on which a hearing is desired.
Upon the filing of a request for hearing as provided in Section 30639, the district board shall fix the time and place for hearing. The time fixed shall not be less than 15 days nor more than 60 days from the date the request is filed. Notice of the hearing shall be given to the county or city requesting the hearing, shall be mailed to the governing body of each city and county located, in whole or in part, within the district, and shall be published once by the board.
At the time fixed for any hearing before the board any board of supervisors or city governing body eligible to file a request for hearing, not a party to the original request for hearing, may intervene and shall be entitled to be heard and to introduce evidence.
The district, petitioner or petitioners, and the intervenors shall have the right to call and examine witnesses; to introduce exhibits; to cross-examine opposing witnesses on any matter relevant to the issues even though that matter was not covered in direct examination; and to rebut evidence introduced by other parties.
Oral evidence shall be taken only on oath or affirmation. The hearing need not be conducted according to technical rules relating to evidences and witnesses. Any relevant evidence shall be admitted if it is the sort of evidence on which responsible persons are accustomed to rely in the conduct of serious business affairs, regardless of the existence of any common law or statutory rule which might make improper the admission of such evidence over objection in a civil action. Hearsay evidence may be used for the purpose of supplementing or explaining any direct evidence but shall not be sufficient in itself to support a finding unless it would be admissible over objection in a civil action.
A complete record of all proceedings and testimony before the board at such hearing shall be taken down by a reporter appointed by the board. In case an action is brought to review any decision of the board, a transcript of such testimony, together with all exhibits or copies thereof introduced, together with the written request for hearing and other proceedings in the cause shall constitute the record on review; provided, however, that the board and other parties may stipulate in writing that a specified portion of the evidence be certified to the court for judgment and in such case the portion of the evidence specified and the stipulation specifying such evidence shall be the record on review.
Within 30 days after the conclusion of the hearing, the board shall render its decision, in writing, with written findings of fact. Copies of the findings and decision shall be sent immediately to the petitioners and intervenors by certified mail, postage prepaid.
The district shall be subject to regulations of the Public Utilities Commission relating to safety appliances and procedures, and the commission shall inspect all work done pursuant to this part and may make such further additions or changes necessary for the purpose of safety to employees and the general public.
The district shall be subject to the jurisdiction of the Public Utilities Commission with respect to safety rules and other regulations governing the operation of street railways.
The commission shall enforce the provisions of this section.
The district shall be subject to the provisions of Division 14.8 (commencing with Section 34500) of the Vehicle Code with respect to the operation of buses and to the rules and regulations prescribed by the Department of the California Highway Patrol pursuant to that chapter regulating the safe operation of buses.
ARTICLE 5.5. Citizens’ Advisory Committees [30650. - 30656.]
Before the district takes action on a route, grades, or station location, including parking and storage facilities, for any portion of a rail transit system, the district may establish a citizens’ advisory committee in the area for any identifiable segment of a rail transit system.
The citizens’ advisory committee may advise the district of the prevalent sentiments of its area and shall advise the board on any and all related transit issues currently under the jurisdiction of, or contemplated by, the district.
The district may establish a citizens’ advisory committee in any identifiable area in which rail transportation is not currently contemplated, but in which the district determines that the board can benefit from public communication, advice, and reaction to district operations, policies, procedures, and plans.
The district shall designate the area to be represented by each citizens’ advisory committee, with a separate area for any identifiable segment of a rail transit system and for any identifiable area in the district in which rail transportation is not currently contemplated.
“Identifiable segment of a rail transit system” means an area of a communality of interest surrounding a station structure or structures and the lines between structures.
A citizens’ advisory committee shall consist of not less than 15 persons and not more than 45 persons.
Every meeting of a citizens’ advisory committee is open to the general public. Minutes of the proceedings shall be kept and shall be available for inspection at the district office.
ARTICLE 6. Claims [30670. - 30670.]
ARTICLE 7. Indebtedness [30700. - 30706.]
The district may issue any bonds, borrow money and incur indebtedness as authorized by law or in this part provided.
The district may accept contributions or loans from the United States, or any department, instrumentality, or agency thereof, for the purpose of financing the acquisition, construction, development, joint development, maintenance, and operation of transit facilities, and may enter into contracts and cooperate with, and accept cooperation from, the United States, or any department, instrumentality, or agency thereof, in the acquisition, construction, development, joint development, maintenance, and operation of any transit facilities in accordance with any legislation which Congress may have adopted or may hereafter adopt, under which aid, assistance, and cooperation may be furnished by the United States in the acquisition, construction, development, joint development, maintenance, and operation or in financing the acquisition, construction, development, joint development, maintenance, and operation of any transit facilities. The district may do any and all things necessary, within the limitations imposed by this part or by any indebtedness created pursuant to this part, in order to avail itself of the aid, assistance, and cooperation under any federal legislation now or hereafter enacted. Any bonds, notes, equipment trust certificates, or like evidences of indebtedness issued for a purpose authorized by this section shall be issued in accordance with Chapter 7 (commencing with Section 30900).
The district may cooperate with and enter into agreements with the State of California or any public agency for the acquisition, construction, development, joint development, completion, maintenance, operation, or repair, joint or otherwise, and in whole or in part, of transit facilities. In connection with any such cooperation or contract, the state or any public agency may make public contributions to the district as in the judgment of the Legislature, or the governing board of the agency, are necessary or proper for its undertaking, and the district may reimburse the state or public agency for any advance or contribution from the proceeds of the sale of bonds or any other funds available to the district. The state or any public agency may also authorize, aid, and assist the district to carry out any activity which the state or public agency is authorized to perform and carry out on its own behalf. Any bonds, notes, equipment trust certificates, or like evidences of indebtedness issued for a purpose authorized by this section shall be issued in accordance with Chapter 7 (commencing with Section 30900).
The district may accept contributions or loans from the State of California or any public agency, for the purpose of planning, acquiring, constructing, developing, jointly developing, operating, or maintaining a rapid transit system, including, without limitation, the payment of principal and interest and providing security funds for bonds or notes of the district issued for any of those purposes, and may enter into contracts and cooperate with, and accept cooperation from, the state or any public agency therefor. The district is a public rapid transit district, rapid transit district, or any other type of public agency which is authorized by any other law to receive those contributions, loans, or cooperation, including, without limitation, Sections 11005.1 and 11104 of the Revenue and Taxation Code. The district may do any and all things necessary, within the limitations imposed by this part or by any indebtedness created pursuant to this part, in order to avail itself of those contributions, loans, or cooperation.
The district may make an irrevocable pledge or contract in connection with the payment of the principal and the interest, sinking or reserve funds, or other obligation of any bonded indebtedness created under this part of any transit funds or other continuing or annual appropriations, contributions, grants, or loans by the United States or any department, instrumentality, or agency thereof, the State of California, a county, a city, or any other public agency, or any other individual or entity, public or private, pursuant to law or this article. The irrevocability of any pledge or contract hereunder shall be binding on the district to the full extent authorized or permitted by the laws governing or applicable to the source of those transit funds, appropriations, contributions, grants, or loans, or by this article. This article shall include, but not be limited to, appropriations or other funds authorized or allocated under Chapter 138 of the Statutes of 1964, First Extraordinary Session, and Chapter 155 of the Statutes of 1966, First Extraordinary Session, or as they may hereafter be amended.
No transit funds, appropriations, contributions, grants, or loans received by the district shall be pledged or by contract be obligated to the payment of any district bonded indebtedness or the principal, interest, sinking or reserve fund payments of that indebtedness unless the pledge or contract is authorized or permitted by the laws governing or applicable to those transit funds, appropriations, contributions, grants, or loans including any official action that may be required of any federal, state, local, or public agency, or any other individual or entity, public or private, and, in the case of incurring indebtedness by the issuance of bonds, the proposition has been approved by 60 percent of those qualified electors of the district voting on the proposition to create the indebtedness at an election called for that purpose pursuant to this part. A vote in favor of the issuance of the bonds shall authorize the use of those transit funds, appropriations, contributions, grants, or loans for those purposes and no other or further elections need be held to authorize the board to collect or provide for the collection of and to make that use of those funds or moneys. The authority to use those funds or moneys shall continue until the bonds and the interest thereon are paid or until a fund sufficient for the payment thereof or of the redemption thereof prior to maturity, with any premiums required therefor, has been created and set aside for that purpose.
“Transit funds,” as used in this part, means any funds or moneys payable to or received by the district from any California transit funds or any funds which the United States or any department, instrumentality, or agency thereof, the State of California, a county, a city, or any other public agency, or any other individual or entity, public or private, has or is authorized by any law or by official action thereunder to appropriate, contribute, grant, or loan to the district to be used for the payment of any indebtedness, including, but not limited to, any bonded indebtedness of the district in accordance with this part or any other law.
To the extent permitted by the law governing the source of any transit funds, appropriations, contributions, grants or loans received pursuant to this article or under any other law or otherwise, such funds or moneys may also be used to pay construction costs directly and reduce expenditures to be financed from bonds of the district, and in such event, the total amount of the bonds approved by the voters may be reduced to the extent that such transit funds, appropriations, contributions, grants or loans are so applied directly to construction costs.
The district shall not incur an indebtedness which exceeds in the aggregate 15 percent of the assessed value of all real and personal property in the district. Within the meaning of this section, “indebtedness” includes, without limitation, any and all forms thereof which the district is authorized to issue by this part or by any other law.
The district may also refund any indebtedness as provided in this part or in any other applicable law. The board may provide for the issuance, sale or exchange of refunding bonds to redeem or retire any bonds issued by the district upon the terms, at the times and in the manner which it determines. Refunding bonds may be issued in a principal amount sufficient to pay all or any part of the principal of any bonds outstanding, the interest thereon and the premiums, if any, due upon call and redemption thereof prior to maturity and all expenses of such refunding. The provisions of this part for issuance and sale of any bonds apply to the issuance and sale of such refunding bonds; except that (i) the issuance of refunding bonds shall be approved by 60 percent of the votes cast by the qualified electors of the district voting at an election called and held for that purpose except that an election is not required if the refunding is by the same type of bonds and payable from the same sources, and (ii) when refunding bonds are to be exchanged for any bonds outstanding the methods of exchange shall be as determined by the board.
Unless the context otherwise requires, the definitions of the following terms shall apply to indebtedness under this part:
“Any bond” or “any bonded indebtedness” means bonds or indebtedness of any kind or nature issued or authorized, respectively, pursuant to Chapter 7 (commencing with Section 30900).
“Bond” means the bond authorized pursuant to Article 1 (commencing with Section 30900) of Chapter 7.
“Limited tax bond” means the bond issued pursuant to Article 1.5 (commencing with Section 30920) of Chapter 7.
“Revenue bond” means the bond issued pursuant to Article 2 (commencing with Section 30930) of Chapter 7.
“Improvement district bond” means the bond issued pursuant to Article 5 (commencing with Section 30960) of Chapter 7.
“Revenues” means any funds of the district, including transit funds other than property taxes levied under Section 30802 and special taxes levied under Section 30820.
ARTICLE 8. Investments [30730. - 30730.]
The board may, by resolution, order that any of the moneys in the funds under its control which are not necessary for current operating expenses be invested in any obligations, bonds or securities in which a county could invest such funds; provided, however, that (1) any such investments shall be made in such a manner that the moneys in such funds will be available at the times and in the amounts necessary to accomplish the purpose for which said funds were established, and (2) no such investment shall be made in contravention of any provision or covenant in any proceedings for the authorization and issuance of bonds, notes, contracts or other evidences of indebtedness.
ARTICLE 9. Elections [30740. - 30742.]
All district elections shall be held in accordance with the provisions of the Elections Code of the State of California, as the same now exist or may hereafter be amended, for the holding of elections in general law cities insofar as the same are not in conflict with this part. Pursuant to the Elections Code, all district elections shall be consolidated with either a statewide general election or a statewide direct primary election.
The board of directors or any officer or member or members thereof authorized by that body, or any individual voter or bona fide association, or any combination of voters and associations, may file a written argument for or against any district bond or tax measure. No argument shall exceed 300 words in length. The county elections official of the County of Los Angeles shall cause an argument for and an argument against the measure to be printed, and shall enclose a copy of both arguments printed on the same sheet of paper in an envelope with each sample ballot. The printed arguments are official matter within the meaning of those words as used in Section 13303 of the Elections Code. Based on the time reasonably necessary to prepare and print the arguments and sample ballots for that election, the elections official shall fix and determine a reasonable date prior to the election after which no argument for or against the measure may be submitted to him or her for printing and distribution to the voters, as provided in this section. Arguments may be changed until and including the date fixed by the elections official. If more than one argument for or more than one argument against any measure is submitted to the elections official within the time prescribed, the elections official shall select one of the arguments in favor and one of the arguments against the measure for printing and distribution to the voters. The arguments so selected shall be those of bona fide supporters or opponents of the measure.
The provisions of the Elections Code of the State of California, as the same now exist or may hereafter be amended, governing the initiative and referendum in districts shall apply insofar as such provisions of the Elections Code are not in conflict with this part. Insofar as the district is concerned, officers of the district shall not be subject to recall.
No irregularities or informalities in conducting any election shall invalidate the same if the election shall have been otherwise fairly conducted.
ARTICLE 10. Labor Provisions [30750. - 30756.]
Subject to subdivision (b), if a majority of the employees employed by a district in a unit appropriate for collective bargaining indicate a desire to be represented by a labor organization, then the board, after determining pursuant to Section 30751 that the labor organization represents the employees in the appropriate unit, shall bargain with the accredited representative of those employees. Both parties shall bargain in good faith and make all reasonable efforts to reach agreement on the terms of a written contract governing wages, hours, and working conditions. In the absence of the expression of the desire to be represented by a labor organization, employees are subject to any personnel system established pursuant to Section 30257.
Upon the acquisition by the district of the property of the Los Angeles Metropolitan Transit Authority pursuant to Chapter 8 (commencing with Section 31000), the district shall assume and observe all existing labor contracts and shall recognize the labor organization certified to represent the employees in each existing bargaining unit as the sole representative of the employees in each of those bargaining units. Any certification of a labor organization previously made by the California State Mediation and Conciliation Service under the provisions of the Los Angeles Metropolitan Transit Authority Act of 1957 to represent or act for the employees in any collective bargaining unit shall remain in full force and effect and shall be binding upon the district. Those certifications and any certifications made under this subdivision shall not be subject to challenge on the grounds that a new substantial question of representation within the collective bargaining unit exists until the lapse of one year from the date of certification or the expiration of any collective bargaining agreement, whichever is later; provided, that no collective bargaining agreement shall be construed to be a bar to representation proceedings for a period of more than two years.
The obligation of the district to bargain in good faith with a duly designated or certified labor organization and to execute a written collective bargaining agreement with that labor organization covering the wages, hours, and working conditions of the employees represented by that labor organization in an appropriate unit, and to comply with the terms of that collective bargaining agreement, shall not be limited or restricted by any other provision of law. The obligation of the district to bargain collectively shall extend to all subjects of collective bargaining, including, but not limited to, retroactive pay increases. Notwithstanding any other provision of law, the district shall make deductions from the wages and salaries of its employees, upon receipt of authorization to make those deductions, for the payment of union dues, fees, or assessments, for the payment of contributions pursuant to any health and welfare plan or pension plan, or for any other purpose for which deductions may be authorized by employees where the deductions are pursuant to a collective bargaining agreement with a duly designated or certified labor organization.
If a dispute arises over wages, hours, or working conditions that is not resolved by negotiations conducted in good faith between the board and the representatives of the employees, then upon the agreement of both parties, the board and the representative of the employees may submit the dispute to an arbitration board. The decision of a majority of the arbitration board shall be final and binding.
The arbitration board shall be composed of two representatives of the district, two representatives of the labor organization, and a fifth member to be agreed upon by the representatives of the district and labor organization.
If the representatives of the district and labor organization are unable to agree on the fifth member, then the names of five persons experienced in labor arbitration shall be obtained from the California State Mediation and Conciliation Service. The labor organization and the district shall, alternately, strike a name from the list supplied by the California State Mediation and Conciliation Service. The labor organization and the district shall determine by lot who shall first strike a name from the list. After the labor organization and the district have stricken four names, the name remaining shall be designated as the arbitrator. The decision of a majority of the arbitration board shall be final and binding upon the parties.
The district and the labor organization shall each pay half of the cost of the impartial arbitrator.
A contract or agreement shall not be made with any labor organization, association, group, or individual that denies membership on any basis listed in subdivision (a) of Section 12940 of the Government Code, as those bases are defined in Sections 12926 and 12926.1 of the Government Code. However, the organization may preclude from membership any individual who advocates the overthrow of the government by force or violence.
The district shall not discriminate with regard to employment against any person on any basis listed in subdivision (a) of Section 12940 of the Government Code, as those bases are defined in Sections 12926 and 12926.1 of the Government Code, except as otherwise provided in Section 12940 of the Government Code.
Any question which may arise with respect to whether a majority of the employees in an appropriate unit desire to be represented by a labor organization shall be submitted to the Public Employment Relations Board. In resolving those questions of representation including the determination of the appropriate unit or units, petitions, the conduct of hearings and elections, the board shall apply the relevant federal law and administrative practice developed under the Labor Management Relations Act, 1947, as amended, and for this purpose shall adopt appropriate rules and regulations. Those rules and regulations shall be administered by the California State Mediation and Conciliation Service and shall provide for a prompt public hearing and a secret ballot election to determine the question of representation.
Whenever the district acquires existing facilities from a publicly or privately owned public utility, either in proceedings by eminent domain or otherwise, to the extent necessary for operation of facilities, all of the employees of such public utility whose duties pertain to the facilities acquired who have been employed by said utility for at least seventy-five (75) days shall be appointed to a comparable position in the district without examination and shall be governed thereafter by the personnel system adopted by the board, and these employees shall be given sick leave, seniority and vacation credits in accordance with the records of the acquired public utility.
The provisions of this section shall apply only to those officers or supervisory employees of the acquired utility as shall be designated by the board.
Whenever the district acquires existing facilities from a publicly or privately owned public utility, either in proceedings in eminent domain or otherwise, the district shall assume and observe all existing labor contracts, and to the extent necessary for operation of facilities acquired, all of the employees of such acquired public utility whose duties pertain to the facilities acquired, shall be appointed to comparable positions in the district without examination, subject to all the rights and benefits of this part, and these employees shall be given sick leave, seniority, pension and vacation credits in accordance with the records and labor agreements of the acquired public utility.
Members and beneficiaries of any pension or retirement system or other benefits established by that public utility shall continue to have the rights, privileges, benefits, obligations and status with respect to such established system. No employee of any acquired public utility shall suffer any worsening of his wages, seniority, pension, vacation or other benefits by reason of the acquisition.
The district shall not acquire any existing transit system or part thereof whether by purchase, lease, condemnation, or otherwise, or dispose of or lease any transit system or part thereof, or merge, consolidate or coordinate any transit system or part thereof, or substitute any type of equipment on any system or part thereof for the then existing equipment or terminate any lease arrangement or management contract, or reduce or limit the lines or service of any existing system or of its system unless it shall first have made adequate provision for the district’s employees who are or may be displaced, or whose wages, hours, place or conditions of employment are or may be adversely affected. The terms and conditions of such provisions shall be a proper subject of collective bargaining with the labor organizations that represent such employees. In the event the parties are unable to agree upon such provisions the dispute shall be submitted to arbitration. The arbitrator shall be selected according to procedures established by subdivision (d) of Section 30750. The decision of the arbitrator shall be final and binding on the parties. In the event that at the time the district acquires a system or part thereof, and former or furloughed employees of such system are at that time entitled to protection under a collective bargaining agreement or an order of the Public Utilities Commission or other public agency, the district shall provide for the continuation of such protection for the period of the agreement or order.
Employees shall have the right to self-organization, to form, join, or assist labor organizations, to bargain collectively through representatives of their own choosing, and to engage in other concerted activities for the purpose of collective bargaining or other mutual aid or protection.
In the event the board and the representatives of the employees do not agree to submit a dispute over the terms and conditions of a collective bargaining agreement to arbitration as provided in subdivision (d) of Section 30750, the State Conciliation Service may be notified by either party that a dispute exists and that there is no agreement to arbitrate.
Following such notification, the State Conciliation Service shall determine whether or not the dispute may be resolved by the parties and, if not, the issues concerning which the dispute exists.
Upon a determination that the dispute cannot be resolved by the parties, the service shall certify its findings to the Governor of the State of California.
The Governor shall, within 10 days of receipt of certification, appoint a factfinding commission consisting of three persons.
The commission shall immediately convene and inquire into and investigate the issues in the dispute.
The commission shall have authority to issue subpoenas for the attendance of witnesses and subpoenas duces tecum for the production of books, documents, and other records. Subpoenas shall be serviced and enforced in accordance with Chapter 2 (commencing with Section 1985) of Title 3, Part 4 of the Code of Civil Procedure.
The commission shall report to the Governor within 60 days of the date of its creation. However, the commission shall deliver a preliminary confidential report to the parties not later than the 51st day of the 60-day period, and the parties may submit comments on such report to the commission for its consideration not later than the 54th day of the 60-day period.
The commission shall, if either party so requests in its comments, include in its report an estimate of the cost of implementing any proposals or recommendations contained in the report.
After notification to the State Conciliation Service by either party in accordance with subdivision (a), no change, except by mutual agreement, shall be made by the parties in the conditions out of which the dispute arose and service to the public shall continue to be provided (1) until the service determines that the dispute may be resolved by the parties, or (2) if the service determines that the dispute cannot be resolved by the parties, until 10 days after the commission has made its report to the Governor.
CHAPTER 7. Bonds and Other Evidences of Indebtedness [30900. - 30982.]
ARTICLE 1. Authorization and Issuance of Bonds [30900. - 30913.]
Whenever the board deems it necessary for the district to incur a bonded indebtedness for the acquisition, construction, development, joint development, maintenance, operation, or repair of any or all improvements, works, property, or facilities, authorized by this part or necessary for, incidental to, or convenient for the carrying out of the powers of the district, or for any other purpose authorized by this part, including, without limitation, the refunding referred to in Chapter 8 (commencing with Section 31000), it shall, by ordinance, adopted by a vote of two-thirds of all members of the board, so declare and call an election to be held in the district for the purpose of submitting to the qualified voters thereof the proposition of incurring indebtedness by the issuance of bonds of the district. The ordinance shall state all of the following:
The purposes for which the proposed debt is to be incurred, which may include all costs and estimated costs necessary or convenient for, incidental to, or connected with the accomplishment of those purposes, including, without limitation, engineering, inspection, legal, fiscal agents, financial consultant, and other fees, bond and other reserve funds, working capital, bond interest estimated to accrue during the construction period and for a period not to exceed three years thereafter, and expenses of all proceedings for the authorization, issuance, and sale of the bonds.
The estimated cost of accomplishing those purposes.
The amount of the principal of the indebtedness.
The maximum term the bonds proposed to be issued shall run before maturity, which shall not exceed 50 years from the date thereof or the date of each series thereof.
The maximum rate of interest to be paid, which shall not exceed the maximum rate allowed by law.
The proposition to be submitted to the voters, which may include one or more purposes.
The date of the election.
The manner of holding the election and the procedure for voting for or against the measure.
The ordinance may also contain any other matters authorized by this part or any other law.
Notice of the holding of such election shall be given by publishing, pursuant to Section 6066 of the Government Code, the ordinance calling the election in at least one newspaper published in such district. No other notice of such election need be given. Except as otherwise provided in the ordinance, the election shall be conducted as other district elections.
If any proposition is defeated by the electors, the board shall not call another election on a substantially similar proposition to be held within six months after the prior election. If a petition requesting submission of such a proposition, signed by 15 percent of the district electors, as shown by the votes cast for all candidates for governor at the last gubernatorial election, is filed with the board, it may call an election before the expiration of six months.
If 60 percent of the electors voting on the proposition vote for it, then the board may, by resolution, at such time or times as it deems proper, issue bonds of the district for the whole or any part of the amount of the indebtedness so authorized and may from time to time, by resolution, provide for the issuance of such amounts as the necessity thereof may appear, until the full amount of such bonds authorized shall have been issued. Said full amount of bonds may be divided into two or more series and different dates and different dates of payment fixed for the bonds of each series. A bond need not mature on an anniversary of its date. The maximum term the bonds of any series shall run before maturity shall not exceed 50 years from the date of each series respectively. In such resolution or resolutions the board shall prescribe the form of the bonds (including, without limitation, registered bonds and coupon bonds) and the form of any coupons to be attached thereto, the registration, conversion and exchange privileges, if any, pertaining thereto, and fix the time when the whole or any part of the principal shall become due and payable.
The bonds shall bear interest at a rate or rates not exceeding the maximum rate allowed by law, payable semiannually, except that the first interest payable on the bonds or any series thereof may be for any period not exceeding one year as determined by the board. In the resolution or resolutions providing for the issuance of the bonds, the board may also provide for call and redemption of the bonds prior to maturity at the times and prices and upon any other terms as it may specify. However, no bond shall be subject to call or redemption prior to maturity unless it contains a recital to that effect or unless a statement to that effect is printed thereon. The denomination or denominations of the bonds shall be stated in the resolution providing for their issuance, but shall not be less than one thousand dollars ($1,000). The principal of, and interest on, the bonds shall be payable in lawful money of the United States at the office of the treasurer of the district or at any other place or places as may be designated, or at either place or places at the option of the holders of the bonds. The bonds shall be dated, numbered consecutively, signed by the president and treasurer, and countersigned by the secretary, and the official seal of the district shall be attached. The interest coupons of the bonds shall be signed by the treasurer. All the signatures, countersignatures, and seal may be printed, lithographed, or mechanically reproduced, except that one of the signatures or countersignatures on the bonds shall be manually affixed. If any officer whose signature or countersignature appears on bonds or coupons ceases to be that officer before the delivery of the bonds, his or her signature is as effective as if the officer had remained in office.
The bonds may be sold as the board determines by resolution but for not less than par. Before selling the bonds, or any part thereof, the board shall give notice inviting sealed bids in such manner as it may prescribe. If satisfactory bids are received the bonds offered for sale shall be awarded to the highest responsible bidder. If no bids are received or if the board determines that the bids received are not satisfactory as to price or responsibility of the bidders the board may reject all bids received, if any, and either readvertise or sell the bonds at private sale.
Delivery of any bonds may be made at any place either inside or outside the State, and the purchase price may be received in cash or bank credits.
All accrued interest and premiums received on the sale of bonds shall be placed in the fund to be used for the payment of principal of and interest on the bonds and the remainder of the proceeds of the bonds shall be placed in the treasury to the credit of the proper improvement fund and applied exclusively to the purposes for which the debt was incurred; provided, however, that when said purposes have been accomplished any moneys remaining in such improvement fund (a) shall be transferred to the fund to be used for the payment of principal of and interest on the bonds, or (b) shall be placed in a fund to be used for the purchase of outstanding bonds of the district from time to time in the open market at such prices and in such manner, either at public or private sale or otherwise, as the board may determine. Bonds so purchased shall be canceled immediately.
After the expiration of three years after a bond election the board may determine, by ordinance adopted by a vote of two-thirds of all the members of the board, that any or all of the bonds authorized at said election remaining unsold shall not be issued or sold. When the ordinance takes effect, the authorization to issue said bonds shall become void.
Whenever the board deems that the expenditure of money for the purposes for which the bonds were authorized by the voters is impractical or unwise, it may, by ordinance adopted by a vote of two-thirds of all members of the board, so declare and call an election to be held in the district for the purpose of submitting to the qualified voters thereof the proposition of incurring indebtedness by the issuance of such bonds for some other purposes or, in the case where bonds have been sold, the proposition to use the proceeds for some other purposes. The procedure, so far as applicable, shall be the same as when a bond proposition is originally submitted.
The provisions of Article 4 (commencing with Section 53500), Chapter 3, Part 1, Division 2, Title 5 of the Government Code are applicable to the district.
Any bonds which shall be issued under the provisions of this article shall be legal investment for all trust funds; for the funds of insurance companies, banks—both commercial and savings—and trust companies; and for state school funds; and whenever any money or funds may, by any law now or hereafter enacted, be invested in bonds of cities, cities and counties, counties, school districts, or other districts within the State of California, such money or funds may be invested in the bonds issued under this part, and whenever bonds of cities, cities and counties, counties, school districts, or other districts within this State may, by any law now or hereafter enacted, be used as security for the performance of any act or the deposit of any public moneys, the said bonds issued under this part may be so used. The provisions of this article shall be in addition to all other laws relating to legal investments and shall be controlling as the latest expression of the Legislature with respect thereto.
ARTICLE 2. Revenue Bonds [30930. - 30932.]
Whenever the board deems it necessary for the district to incur a revenue bonded indebtedness for the acquisition, construction, development, joint development, operation, maintenance, completion, or repair of any or all improvements, works, property, or facilities authorized by this part or necessary or convenient for the carrying out of the powers of the district, or for any other purpose authorized by this part, including, without limitation, the refunding referred to in Chapter 8 (commencing with Section 31000), the board shall provide for the issuance of the revenue bonds in accordance with the Revenue Bond Law of 1941 (Chapter 6 (commencing with Section 54300) of Part 1 of Division 2 of Title 5 of the Government Code), as it now exists or may hereafter be amended; except that, (a) if the board provides for the issuance of the revenue bonds by ordinance adopted by a vote of two-thirds of all the members of the board, which ordinance shall be subject to referendum, and (b) no election is required by Section 30932, no election need be called or held for the purpose of authorizing the issuance of the revenue bonds.
Revenue bonds may include one or more purposes; and the purposes for which revenue bonds may be issued may include, without limitation, all costs and estimated costs incidental to, or connected with, the accomplishment of that purpose, or purposes, including, without limitation, engineering, inspection, legal, fiscal agents, financial consultant, and other fees, bond and other reserve funds, working capital, bond interest estimated to accrue during the construction period and for a period not to exceed three years thereafter, and expenses of all proceedings for the authorization, issuance, and sale of the bonds.
The district is hereby declared to be a local agency within the meaning of the Revenue Bond Law of 1941. The term “enterprise” as used in the Revenue Bond Law of 1941 shall for all purposes of this part include any or all improvements, works, property or facilities, authorized by this part or necessary or convenient for the carrying out of the powers of the district.
Revenue bonds issued under the provisions of this Article 2 shall be subject to the priorities set forth in Section 30638. Revenue bonds shall have a priority as to the use of revenues superior to that of any bonds for improvement districts issued under Article 5 of this chapter. Revenue bonds having a priority as to the use of revenues superior to that of any bonds issued under Article 1 of this chapter may be issued if the proposition for the issuance of such revenue bonds with such priority shall have been submitted by the board by the same vote required under Article 1 and approved by the electors by the same vote required under Article 1.
ARTICLE 3. Equipment Trust Certificates [30940. - 30943.]
The district shall have power to purchase equipment such as cars, trolley buses and motorbuses, rolling equipment, and may execute agreements, leases and equipment trust certificates in the forms customarily used by private corporations engaged in the rapid transit business appropriate to effect such purchase and leasing of rolling equipment and may dispose of such equipment trust certificates upon such terms and conditions as the board may deem appropriate. All money required to be paid by the district under the provisions of such agreements, leases and equipment trust certificates shall be payable solely from the revenue or income to be derived from the transportation system and from grants or loans, or both, as provided in Sections 30701, 30702, and 30703 of this part. Payment for such equipment, or rentals therefor, may be made in installments, and the deferred installments may be evidenced by equipment trust certificates payable solely from such revenue, income, grants, or loans, and title to such equipment shall not vest in the district until the equipment trust certificates are paid.
The agreement to purchase or lease may direct the vendor or lessor to sell and assign or lease the rolling equipment to a bank or trust company duly authorized to transact business in the State of California as trustee, lessor or vendor for the benefit and security of the equipment trust certificates and may direct such trustee to deliver the rolling equipment to one or more designated officers of the district and may authorize the district to simultaneously therewith execute and deliver an installment purchase agreement or a lease of the equipment to the district.
The agreements and leases shall be duly acknowledged before some person authorized by law to take acknowledgments of deeds and in the form required for acknowledgment of deeds and such agreements, leases, and equipment trust certificates shall be authorized by resolution of the district and shall contain such covenants, conditions and provisions which may be deemed necessary or appropriate to insure the payment of the equipment trust certificates from such revenue, income, grants or loans.
The covenants, conditions and provisions of the agreements, leases, and equipment trust certificates shall not conflict with any of the provisions of any agreement securing the payment of bonds, notes or certificates of the district.
ARTICLE 4. Temporary Borrowing [30950. - 30952.]
Prior to the time moneys authorized by special taxes under Part 16 (commencing with Section 36000) of Division 2 of the Revenue and Taxation Code and already levied by the county are available or funds are allocated to the district under said part or other state or federal laws, the district may borrow money to provide funds for the purposes provided in Section 30636 of this code, and for the expenses of the calling, giving notice of, holding and conducting of any bond election under this part.
The amount to be borrowed pursuant to this section shall be evidenced by notes bearing interest at a rate of not to exceed 6 percent per annum, payable annually or semiannually, maturing not more than two years from their date and subject to call and redemption at the option of the district at any time prior to their stated maturity dates on the terms and conditions specified by the board and stated in the notes. The amount to be borrowed pursuant to this section (including both the principal of and interest to maturity on the notes evidencing such borrowing) shall not exceed eighty-five percent (85%) of the special tax or said other moneys to be used to repay said notes and interest thereon and to be received by the district between the date of borrowing and the final maturity date of the notes, as estimated by the auditor at the time of the borrowing. The notes shall be payable only from special taxes authorized under Part 16 (commencing with Section 36000) of Division 2 of the Revenue and Taxation Code and already levied by the county, or from other moneys allocated under state laws other than this part, or federal laws. The form of the notes and the provisions of the resolution or resolutions of the board providing for their issuance and sale shall be governed by the applicable provisions of this article.
The district may borrow money in anticipation of the sale of bonds which have been authorized to be issued, but which have not been sold and delivered, and may issue negotiable bond anticipation notes therefor for the same purposes and may renew the same from time to time, but the maximum maturity of any such notes, including the renewals thereof, shall not exceed five years from the date of delivery of such original notes. Such notes shall be paid from any moneys of the district from which said bonds would be payable. If not so paid the notes shall be paid from the proceeds of the next sale of the bonds of the district in anticipation of which they were issued, and if said bonds are not issued, then taxes may be levied for their payment in the same manner as taxes are levied for said bonds. Such notes shall not be issued in an amount in excess of the aggregate amount of authorized bonds of the district remaining, less the amount of bond anticipation notes outstanding. Such notes shall be in such form as the board of directors of the district may select and may include any applicable provisions of the bonds in anticipation of which they were issued. The notes may be sold as the board of directors of the district determines by resolution but not for less than par. Before selling the notes or any part thereof the board of directors shall give notice inviting sealed bids in such manner as it may prescribe. If satisfactory bids are received the notes offered for sale shall be awarded to the highest responsible bidder. If no bids are received or if the board of directors determines that the bids received are not satisfactory as to price or responsibility of the bidders, the board of directors may reject all bids received, if any, and readvertise for sealed bids.
Notwithstanding any provision of Article 7.7 (commencing with Section 53859) of Chapter 4 of Part 1 of Division 2 of Title 5 of the Government Code, the district may borrow money for the purchase of buses and rolling stock, or transportation facilities, or for capital improvement, by the issuance of grant anticipation notes issued pursuant to that article that are payable on the basis of any of the following:
From appropriated state funds.
From other funds committed, but not appropriated, and evidenced by an appropriate document of intent.
On specific dates or events and evidenced by an appropriate document of intent.
In addition to the grant money that may be pledged for the payment of the notes pursuant to Section 53859.06 of the Government Code, the district may pledge as security, on terms that it deems appropriate, the buses, rolling stock, or other transportation facilities acquired with the proceeds of the notes.
ARTICLE 5. Improvement Districts [30960. - 30970.]
Whenever the board deems it necessary for the district to incur a bonded indebtedness for the acquisition, construction, development, joint development, completion, operation, maintenance, or repair of any or all improvements, works, property, or facilities authorized by this part or necessary for, incidental to, or convenient for carrying out the powers of the district, or for any other purpose authorized by this part and to provide for the bonded indebtedness to be payable from taxes levied upon less than all of the district, it shall, by resolution adopted by a vote of two-thirds of all members of the board, so declare and state all of the following:
The purposes for which the proposed debt is to be incurred, which may include all costs and estimated costs incidental to, or connected with, the accomplishment of those purposes, including, without limitation, engineering, inspection, legal, fiscal agents, financial consultant, and other fees, bond and other reserve funds, working capital, bond interest estimated to accrue during the construction period and for a period not to exceed three years thereafter, and expenses of all proceedings for the authorization, issuance, and sale of the bonds.
The estimated cost of accomplishing those purposes and the amount of the principal of the indebtedness to be incurred.
That the board intends to form an improvement district or districts of a portion or portions of the district which, in the opinion of the board, will be benefited, the exterior boundaries of which portion or portions are set forth on a map on file with the secretary of the district, which map shall govern for all details as to the extent of the proposed improvement district or districts, and to call an election in the proposed improvement district or districts on a date to be fixed for the purpose of submitting to the qualified voters thereof the proposition of incurring indebtedness by the issuance of bonds of the district for the improvement district or districts.
That taxes for the payment of the bonds and the interest thereon shall be levied exclusively upon the taxable property in the appropriate improvement district.
The extent to which, if at all, all or a portion of the revenues of the district are to be used as provided in Section 30803 to pay the principal of, interest on, and sinking fund payments for the bonds, including the establishment and maintenance of any reserve fund therefor.
That a general description of the proposed improvement, together with a map showing the exterior boundaries of the proposed improvement district or districts with relation to the territory immediately contiguous thereto and to the proposed improvement, is on file with the secretary of the district and is available for inspection by any person or persons interested.
The time and place for a hearing by the board on the questions of the formation of the proposed improvement district or districts, the extent thereof, the proposed improvement, the estimated cost, and the amount of debt to be incurred.
That, at the time and place specified in the resolution, any person interested, including all persons owning property in the district or in the proposed improvement district or districts, will be heard.
Notice of said hearing shall be given by publishing a copy of the resolution declaring the necessity pursuant to Section 6066 of the Government Code prior to the time fixed for the hearing in at least one newspaper published in the district.
At the time and place so fixed, or at any time and place to which the hearing is adjourned, the board shall proceed with the hearing. At the hearing, any person interested, including any person owning property within the district or within the proposed improvement district or districts, may appear and present any matters material to the questions set forth in the resolution declaring the necessity.
The board may change the purposes for which the proposed debt is to be incurred, or the estimated cost, or the amount of bonded debt to be incurred, or the boundaries of the proposed improvement district or districts, or one or all of those matters. However, the board shall not change the boundaries so as to include any territory which will not, in its judgment, be benefited by the improvement.
The purposes, estimated cost, amount of bonded debt, or boundaries shall not be changed by the board except after notice of its intention to do so, given by publication pursuant to Section 6061 of the Government Code in at least one newspaper published in the district. The notice shall state the changed purposes and the estimated cost and debt proposed and that the exterior boundaries as proposed to be changed are set forth on a map on file with the secretary of the district, which map shall govern for all details as to the extent of the proposed improvement district or districts, and specify the time and place for hearing on the change or changes, which time shall be at least 10 days after the publication of the notice.
At the time and place so fixed, or at any time and place to which the hearing is adjourned, the board shall proceed with the hearing. At the hearing, any person interested, including any person owning property within the district or the proposed improvement district or districts, may appear and present any matters material to the changes stated in the notice.
At the conclusion of the hearing, the board shall, by resolution, determine whether it is deemed necessary to incur the bonded indebtedness, and, if so, the resolution shall also state the purposes for which the proposed debt is to be incurred, the estimated cost of accomplishing those purposes, the amount of the proposed debt, that the exterior boundaries of the portion or portions of the district which will be benefited are set forth on a map on file with the secretary of the district, which map shall govern for all details as to the extent of the improvement district or districts, and that each portion or portions of the district set forth on the map shall thereupon constitute and be known as “Improvement District No. ____ of the Southern California Rapid Transit District,” and the determinations made in the resolution shall be final and conclusive.
After the formation of the improvement district or districts within the district pursuant to this article, all proceedings for the authorization and issuance of bonds of the district for the improvement district or districts shall be limited and shall apply only to the improvement district or districts; and taxes for the payment of those bonds and the interest thereon shall be levied exclusively upon the taxable property in the improvement district or districts; and the revenues of the district shall be used only to the extent set forth in the resolution declaring the necessity.
After the board has made its determination of the matters required to be determined by resolution pursuant to Section 30966, and if the board deems it necessary to incur the bonded indebtedness, the board shall, by a further resolution, call a special election in the improvement district or districts for the purpose of submitting to the qualified voters thereof the proposition of incurring indebtedness by the issuance of bonds of the district for the improvement district or districts. The resolution shall state all of the following:
That the board deems it necessary to incur the bonded indebtedness.
The purposes for which the bonded indebtedness will be incurred.
The estimated cost of accomplishing those purposes.
The amount of the principal of the indebtedness to be incurred.
The improvement district or districts to be benefited by those indebtedness, as set forth in the resolution making determinations, and that a map showing the exterior boundaries of the improvement district or districts is on file with the secretary of the district, which map shall govern for all details as to the extent of the improvement district or districts.
That taxes for the payment of those bonds and the interest thereon shall be levied exclusively upon the taxable property in the improvement district or districts; and that revenues of the district shall be used only to the extent set forth in the resolution declaring the necessity.
The maximum term the bonds proposed to be issued shall run before maturity, which shall not exceed 50 years from the date thereof or the date of each series thereof.
The maximum rate of interest to be paid, which shall not exceed the maximum rate allowed by law.
The proposition to be submitted to the voters which may include one or more purposes.
The date of the election.
The manner of holding the election and the procedure for voting for and against the measure.
Thereafter the provisions relating to the authorization and issuance of bonds, Sections 30901 to 30914, inclusive, shall apply.
Any action or proceeding, wherein the validity of the formation of the improvement district or districts or of any bonds or of the proceedings in relation thereto is contested, questioned, or denied, shall be commenced within three months from the date of the election; otherwise, the bonds and all proceedings in relation thereto, including the formation of the improvement district or districts, is valid and in every respect legal and incontestable.
ARTICLE 6. Miscellaneous [30980. - 30982.]
The district may bring an action to determine the validity of any of its bonds, equipment trust certificates, warrants, notes, or other evidences of indebtedness pursuant to Chapter 9 (commencing with Section 860) of Title 10 of Part 2 of the Code of Civil Procedure.
Notwithstanding any other provisions of this part or any other law, the provisions of all ordinances, resolutions and other proceedings in the issuance by the district of any bonds, bonds with a pledge of revenues, bonds for improvement districts, revenue bonds, equipment trust certificates, notes, or any and all evidences of indebtedness or liability shall constitute a contract between the district and the holders of such bonds, equipment trust certificates, notes or evidences of indebtedness or liability and the provisions thereof shall be enforceable against the district, any or all of its successors or assigns, the state, any department of the state, or any officer thereof, by mandamus or any other appropriate suit, action or proceeding in law or in equity in any court of competent jurisdiction. Nothing contained in this part or in any other law shall be held to relieve the district or the territory included within it from any bonded or other debt or liability contracted by the district. Upon dissolution of the district or upon withdrawal of territory therefrom, the property formerly included within the district or withdrawn therefrom shall continue to be liable for the payment of all bonded and other indebtedness or liabilities outstanding at the time of such dissolution or withdrawal the same as if the district had not been so dissolved or the territory withdrawn therefrom, and it shall be the duty of the state or other successors or assigns to provide for the payment of such bonded and other indebtedness and liabilities. Except as may be otherwise provided in the proceedings for the authorization, issuance and sale of any revenue bonds, bonds secured by a pledge of revenues or bonds for improvement districts secured by a pledge of revenues, revenues of any kind or nature derived from any revenue-producing improvements, works, facilities or property owned, operated or controlled by the district shall be pledged, charged, assigned and have a lien thereon for the payment of such bonds as long as the same are outstanding, regardless of any change in ownership, operation or control of such revenue-producing improvements, works, facilities or property and it shall, in such later event or events, be the duty of the state or other successors or assigns to continue to maintain and operate such revenue-producing improvements, works, facilities or property as long as bonds are outstanding.
All bonds and other evidences of indebtedness issued by the district under the provisions of this part, and the interest thereon, are free and exempt from all taxation within the State of California, except for transfer, franchise, inheritance and estate taxes.
CHAPTER 8. Provisions Relating to the Los Angeles Metropolitan Transit Authority [31000. - 31005.]
On the date (which is hereinafter referred to as “merger date”) of the second regular meeting of the board held pursuant to Section 30251 that follows the meeting referred to in Section 30227 the Los Angeles Metropolitan Transit Authority (herein sometimes referred to as “authority”) shall be merged into the district. Such merger shall be effective upon the recording with the Recorder of the County of Los Angeles of the certificate provided for in Section 31001.
Upon such merger the separate existence of the authority ceases, and the district shall succeed, ipso facto and by operation of law and without other transfer, to all the rights and property of the authority, and shall be subject to all the legally enforceable debts and liabilities of the authority, in the same manner as if the district had itself incurred them.
All rights of creditors and all liens upon the property of the authority shall be preserved unimpaired, limited in lien to the property affected by such liens immediately prior to the time of the merger.
Any action or proceeding pending by or against the authority may be prosecuted to judgment, which shall bind the district, or the district may be proceeded against or substituted in its place.
For the protection of the holders of the outstanding, unmatured bonds and other evidences of indebtedness of the authority the district shall have power to take all actions and do all things necessary or required for the protection of such holders and for compliance with the terms of such bonds and other evidences of indebtedness; and the district shall have power to continue all services which the authority is furnishing on the merger date whether such buslines and services are partly or wholly within or without the district, or within or without the County of Los Angeles.
Upon the merger date, the secretary of the district shall record in the office of the Recorder of the County of Los Angeles a certificate setting forth the date upon which the Southern California Rapid Transit Law became effective and stating that the district was created by such law and that by virtue of Section 31000 thereof the district succeeded on the merger date, without other transfer, to all the rights and property of the authority subject to all the legally enforceable debts and liabilities of the authority.
A copy of the certificate provided for in Section 31001 certified by the Recorder of the County of Los Angeles is, except as against the State, conclusive evidence of the transfer to the district of all the rights and property of the authority subject to all the legally enforceable debts and liabilities of the authority, all as provided in Section 31000 of this part.
On said merger date, all employees of the authority shall become employees of the district with all the same rights, privileges and compensation they had as employees of the authority.
It is the intent of this part that the board of directors of the district shall have a free choice as to officers of the district mentioned in Section 30300 who are not members of the board of directors. At the merger date such officers shall be appointed on a permanent or pro tem basis, in the discretion of the board. Prior to that time, however, the following shall serve as ex officio officers of the district:
Secretary—the Clerk of the Board of Supervisors of the County of Los Angeles.
General Manager—the Chief Administrative Officer of the County of Los Angeles.
General Counsel—the County Counsel of the County of Los Angeles.
Treasurer—the Treasurer of the County of Los Angeles.
Auditor—the Auditor of the County of Los Angeles.
The Board of Supervisors of the County of Los Angeles is authorized and directed to make available to the district its hearing room and other space, personnel and facilities so that the district can be organized and the transfer of operations be completed in an orderly businesslike manner.
Whenever the board deems it necessary, it may issue bonds to refund all outstanding, unmatured bonds of the authority which are subject to call and redemption prior to maturity. The amount of such bonds shall include the principal and, if necessary, the interest of the bonds to be refunded, the premiums payable upon call and redemption thereof and all expenses of the trustee for the refunding, the calling of said bonds for redemption and any other incidental expenses. The refunding bonds shall be authorized and issued in the manner provided for herein as a separate issue or as a part of another issue for any purpose authorized in this part.
CHAPTER 9. Annexation and Exclusion [31400. - 31413.]
The governing body of any city, which is not within the district, may apply to the board of directors of the district for consent to annex the corporate area of such city to the district. The board of supervisors of the County of Los Angeles and any other county may apply to the board of directors of the district for consent to annex any unincorporated county territory to the district.
The board of directors may grant or deny such application and in granting the same may fix the terms and conditions upon which the corporate area of city or unincorporated county territory may be annexed to and become a part of the district. Such terms and conditions may provide, among other things, without limitation, (a) for the levy by the district of special taxes upon taxable property within such city or such unincorporated county territory in addition to the taxes elsewhere in this part authorized to be levied by the district, and in case such terms and conditions shall provide for the levy of such special taxes, the board of directors in fixing such terms and conditions shall specify the aggregate amount to be so raised and the number of years prescribed for raising such aggregate sum, and that substantially equal annual levies will be made for the purpose of raising such sum over the period so prescribed, and (b) representation of the city or unincorporated county territory, as the case may be, on the board or in an advisory capacity to the board; provided, however, that the membership of the board and the appointment thereof shall not be changed unless the terms and conditions are approved by a unanimous vote of all members of the board.
The action of the board of directors evidenced by resolution shall be promptly transmitted to the governing body of such applying city or board of supervisors, and if such action shall grant consent to such annexation, such governing body or board of supervisors may thereupon submit to the qualified electors of such city or the unincorporated county territory, at any general or special election held therein, the proposition of such annexation subject to the terms and conditions fixed as herein provided. Notice of such election shall be given by posting at least 10 days and in three public places in the unincorporated county territory and by publication once at least 10 days before the date fixed for the election in a newspaper of general circulation published in the county or in the city.
The notice shall contain the substance of the terms and conditions fixed by the board of directors, as provided in Section 31401. Such election shall be conducted and the returns thereof canvassed in the manner provided by law for elections in such city or county as the case may be. If the proposition shall receive the affirmative vote of a majority of electors voting thereon at such election, the governing body of such city or the board of supervisors of the county shall certify the result of such election on the proposition to the board of directors of the district, together with a legal description of the boundaries of the corporate area of such city as of the date of the election, or the boundaries of such unincorporated county territory, accompanied by a map or plat indicating such boundaries.
A certificate of proceedings shall be made by the secretary of the district and filed with the Secretary of State. Upon the filing thereof in the office of the Secretary of State, the corporate area of such city as of the date of the election or such unincorporated county territory shall become, and be, an integral part of the district, and the taxable property therein shall be subject to taxation thereafter for all purposes of the district, including, without limitation, the payment of bonds and other obligations of the district at the time authorized or outstanding, and the board of directors of the district shall be empowered to do all things necessary to enforce and make effective the terms and conditions of annexation fixed as hereinabove authorized.
Upon the filing in his or her office of the certificate of proceedings, the Secretary of State shall, within 10 days, issue a certificate, reciting the filing of those papers in his or her office and the annexation of the corporate area of the city as of the date of the election or the unincorporated county territory to the district. The Secretary of State shall transmit the original of the certificate to the secretary of the district and shall forward a certified copy thereof to the county elections official of each county in which the district or any portion thereof is situated.
If territory is annexed to a city or consolidated with a city, the corporate area of which has been included in the district, or, if a new city is incorporated, a portion of which is within the district, such annexed, consolidated, or incorporated territory as is not already within the district shall simultaneously with its annexation to the city or consolidation with a city or its incorporation as a city be annexed to the district, and shall become and be, an integral part of the district and the taxable property therein shall be subject to taxation thereafter for all purposes of the district, including, without limitation, the payment of bonds and other obligations of the district at the time authorized and outstanding, and the board of directors of the district shall be empowered to do all things necessary to enforce and make effective this section.
If the applicable provisions of law governing such annexation to, or consolidation with, such municipality or such incorporation shall require any notice of any election called for the purpose of determining whether such proposed annexation, consolidation or incorporation shall occur, or shall require any notice of hearing or other notice to be given to the residents or electors of, or owners of property in, such territory, such notice shall contain a statement that the territory shall be annexed to the district, and shall become and be an integral part of the district and the taxable property therein shall be subject to taxation thereafter for all purposes of the district, including, without limitation, the payment of bonds and other obligations of the district at the time authorized and outstanding. The governing body of such city or other officer thereof having the duty of certifying the proceedings resulting in such annexation to, or consolidation with, such city, or such incorporation of, pursuant to the provisions of law applicable thereto, shall include in such certification a record of the proceedings by which such territory has been annexed to the district in accordance with the provisions of this article, and shall file a duplicate of such certificate with the board of directors of the district.
The validity of any proceedings resulting in the annexation of territory to the district shall not be contested in any action unless such action shall have been brought within three months after the completion of such annexation.
If any portion of the corporate area of any city whose corporate area is a part of the district, shall be excluded from such city in accordance with the provisions of law applicable to such exclusions, and, if such area is not within the boundaries of the district as defined in Chapter 2 (commencing with Section 30100) of this part, or, if in another county is not surrounded by territory which is a part of the district, then such excluded area shall thereby be excluded from and shall no longer be a part of the district, but the taxable property within such excluded area shall continue taxable pursuant to Section 30981.
Any city whose corporate area is a part of the district and any county with regard to any unincorporated territory which is a part of the district, may apply to the board of directors of the district for consent to exclude the area from the district. The board of directors may grant or deny the application and in granting the same may fix the terms and conditions upon which a corporate area of the city or the unincorporated county territory may be excluded from the district. The terms and conditions shall include, without limitation, exclusion of the city or unincorporated county territory, as the case may be, from representation on the board or in an advisory capacity to the board. The action of the board of directors evidenced by resolution shall be promptly transmitted to the governing body of the applying city or board of supervisors and if the action shall grant consent to the exclusion the governing body of the city or the board or supervisors of the county, as the case may be, may submit to the electors of the city or the unincorporated county territory at any general or special election the proposition of excluding from the district the corporate area of the city or the unincorporated county territory. Notice of the election shall be given in the manner provided in Section 31402. The election shall be conducted and the returns thereof canvassed in the manner provided by law for the conduct of elections in the city or county. In the event that the majority of the electors voting thereon vote in the favor of the withdrawal, the result thereof shall be certified by the governing body of the city or the board of supervisors of the county to the board of directors of the district. A certificate of the proceedings hereunder shall be made by the secretary of the district and filed with the Secretary of State, and upon the filing of the certificate the corporate area of the city or the unincorporated county territory shall be excluded from the district, and shall no longer be a part thereof; provided, however, that the property within the city as the city shall exist at the time of the exclusion, or within the unincorporated county territory shall continue taxable pursuant to Section 30981. Upon the filing in his or her office of the certificate of proceedings the Secretary of State shall, within 10 days, issue a certificate, reciting the filing of the papers in his or her office and the exclusion of the corporate area of the city or the unincorporated county territory from the district. The Secretary of State shall transmit the original of his or her certificate to the secretary of the district and shall forward a certified copy thereof to the county elections official of each county in which the district or any portion thereof is situated.
No consent to annexation or exclusion shall be made by the board of directors of the district pursuant to this chapter, and no annexation or exclusion shall be made pursuant to this part or pursuant to any other law, which is in violation of all or any part of any ordinance, resolution or other proceeding taken by the district in the issuance of bonds, certificates, notes or any and all other evidences of indebtedness or liability of the district.
CHAPTER 10. Severability [31520. - 31520.]
If any section, subsection, sentence, clause, or phrase of this part, or the application thereof to any person or circumstance, is for any reason held invalid, the validity of the remainder of this part, or the application of such provision to other persons or circumstances, shall not be affected thereby. The Legislature hereby declares that it would have passed this part, and each section, subsection, sentence, clause, and phrase thereof, irrespective of the fact that one or more sections, subsections, sentences, clauses or phrases, or the application thereof to any person or circumstance, be held invalid.
CHAPTER 11. Preferential Facilities for High-Occupancy Vehicles [32000. - 32000.]
In cooperation with the Department of Transportation and the cities, counties, and local and regional transportation entities in the district’s service area, the district, after public hearings, shall prepare, and submit to the Legislature by March 31, 1974, a comprehensive plan for the development and operation of preferential facilities for high-occupancy vehicles in its service area.
As used in this section, “preferential facilities” shall include, but not be limited to, freeway lanes, freeway ramps, street lanes, transit terminals, and parking facilities.
CHAPTER 12. Special Benefit Assessment Districts [33000. - 33021.]
The Legislature finds and declares that:
It is necessary and in the best interest of the citizens of the state to authorize the Southern California Rapid Transit District to levy special benefit assessments for needed public rail rapid transit facilities and services on the property which benefits from those facilities and services.
The rail rapid transit facilities and services provide special benefits to parcels of land, and improvements thereon, in the vicinity of rail rapid transit stations, and provide general benefits to the community at large. The Board of Directors of the Southern California Rapid Transit District shall be the conclusive judge of the proportion of special and general benefits produced by the facilities and of the distribution of the special benefits among parcels of property within the benefit assessment district.
Whenever the board finds that property adjacent to, or in the vicinity of, one or more rail transit stations, or proposed rail transit stations, of the district receives or will receive special benefit by reason of the location or operation of one or more of those rail transit stations, the board may, by resolution adopted by a two-thirds vote of its members, provide for notice and hearing on its intention to establish one or more special benefit districts and to levy a special benefit assessment on real property therein for the purpose of financing, in whole or in part, the acquisition, construction, development, joint development, operation, maintenance, or repair of one or more rail transit stations and rail transit related facilities located within the benefit district.
For purposes of this chapter, “benefit district” means a special benefit assessment district established pursuant to this chapter, the area of which shall not lie more than one mile from the center point of any rail transit station or proposed rail transit station within the central business district of the City of Los Angeles and shall not lie more than one-half mile from the center point of any rail transit station or proposed rail transit station at any other location. “Central business district of the City of Los Angeles” means that area within the City of Los Angeles lying east of the Harbor Freeway (State Highway Route 11).
The resolution may provide that the proposed benefit district will contain separate zones, which may consist of either contiguous or noncontiguous areas of land within the district. The proposed benefit district and each proposed zone, if any, therein shall be an area adjacent to, or in the vicinity of, one or more rail transit stations or proposed rail transit stations. The boundaries of the benefit district and of each zone, if any, therein shall be drawn so as to reflect, as accurately as possible, the areas in which special benefits are conferred by reason of the proximity and operation of one or more rail transit stations.
The notice stating the time and place of the hearing, and setting forth the boundaries and purpose of the proposed benefit district, shall be published prior to the time fixed for the hearing pursuant to Section 6066 of the Government Code.
Notice shall also be mailed at least 30 days prior to the hearing to all owners of real property within the boundaries of the proposed benefit district whose names and addresses appear on the last equalized assessment roll or are otherwise known to the Board of Supervisors of the County of Los Angeles or to the district.
For purposes of this chapter, “transit related facilities” means land, buildings and equipment or any interest therein, whether or not the operation thereof produces revenue, which has, as its primary purpose, the operation of the rail transit system or the providing of services to the passengers of the rail transit system, but does not mean any land, buildings, or equipment, or interest therein, which is used primarily for the production of revenue not arising from the operation of the rail transit system.
At the time and place fixed for the hearing on the establishment of the benefit district, or at any time and place to which the hearing is adjourned, the board shall proceed with the hearing. At the hearing, interested persons may appear and present matters material to the proposed board action. At the conclusion of the hearing, the board shall, by a resolution adopted by a two-thirds vote of its members, determine whether to proceed with the proposed action.
The resolution shall state, as appropriate, the maximum and minimum rate of assessment, the amount of the special benefit assessment and the purposes for which it is to be levied, the estimated cost of accomplishing the purposes, and the dates or approximate intervals at which the assessment shall be levied. The resolution shall also state that the exterior boundaries of the benefit district are set forth on a map on file with the secretary of the district, which map shall govern for all purposes as to the extent of the benefit district and zones, if any, therein and that the area set forth on the map shall thereupon constitute and be known as “Benefit District No. __ of the Southern California Rapid Transit District,” or as “Benefit Zone __ of the Benefit District No. __ of the Southern California Rapid Transit District,” as designated by the board.
The resolution shall be submitted to the governing body. The governing body shall, after a public hearing conducted by the governing body and prior to the creation of the benefit district, approve, or amend and approve, as amended, or disapprove the geographic boundaries of the benefit district and the method of assessment. The resolution of approval or disapproval from the governing body shall be returned to the board.
The board shall, by a two-thirds vote of its members, determine whether to create the benefit district as approved by the governing body. If the board decides to proceed with creating the benefit district as approved by the governing body, the board may, in addition to any amendments made by the governing body, reduce the size of the benefit district, but in so doing shall not include any territory not included in the benefit district approved by the governing body nor change the approved method of assessment. The determination by the board is final and conclusive.
For purposes of this section, “governing body” means the city council of a city in which the proposed benefit district is located or, if the benefit district is located in unincorporated territory, the board of supervisors of the county in which the proposed benefit district is located.
The board may provide in the resolution, or in a later resolution adopted by a two-thirds vote of the members of the board, for changes in the assessment to particular real property within the benefit district or any zone therein arising out of changes in the parcel area or floor area of that real property.
In determining the amount of a special benefit assessment, the board may measure the benefit to real property in the benefit district or zones therein by the parcel area of unimproved real property and by the parcel area and the floor area of real property and improvements thereto of improved real property, as deemed appropriate by a resolution adopted by a two-thirds vote of the members of the board.
The special benefit assessment constitutes a charge imposed on particular real property for a district project of direct benefit to that property, and does not constitute ad valorem taxes or any other form of general tax levy applying a given rate to the assessed valuation of all taxable property within the district.
The district shall possess all powers necessary for, incidental to, or convenient for the collection, enforcement, administration, or distribution of the special benefit assessment in accordance with California law.
The revenue from a special benefit assessment, which is imposed pursuant to this chapter, or from bonds secured by such a special benefit assessment, for the purpose of financing a rail transit station or rail transit related facility located within the benefit district, shall be used only for financing of the facility for which it was levied, and that revenue shall not be used for any other purpose or the payment of any other expense of the district, including, but not limited to, transit, transportation, or operating expense.
The board may order benefit assessment without an election, except as otherwise provided in Section 33002.2.
An election shall be held if the board finds that a petition requesting that the proposal be submitted to confirmation by the voters has been signed by the owners of at least 25 percent of the assessed value of real property within the benefit district.
For purposes of this chapter, “voter” means an owner of real property which is assessed or proposed to be assessed under this chapter and which is within the boundaries of the benefit district.
In any election conducted under this chapter, each voter in the benefit district may cast one vote for each one thousand dollars ($1,000), or fraction thereof, worth of land or improvements owned by the voter in the benefit district as is shown on the most recent equalized assessment roll.
Where land in the benefit district is owned in joint tenancy, tenancy in common, or any other multiple ownership, the owners of that land shall designate in writing which one of the owners shall be deemed the owner of that land for purposes of qualifying as a voter.
The legal representative of a corporation or an estate owning real property in the benefit district may act on behalf of the corporation or the estate.
For purposes of this chapter, “legal representative” means an official of a corporation owning real property in the benefit district.
For purposes of this chapter, “legal representative” also means a guardian, conservator, executor, or administrator of the estate of the holder of title to real property in the benefit district who is all of the following:
The person is appointed under the laws of this state.
The person is entitled to the possession of the estate’s real property.
The person is authorized by the appointing court to exercise the particular right, privilege, or immunity which he or she seeks to exercise.
Before a legal representative acts as a voter at a district election, the legal representative shall present to the precinct board a certified copy of his or her authority which shall be kept and filed with the returns of the election.
The petition for confirmation by the voters shall be filed with the board within 30 days after the conclusion of the public hearing required by Sections 33001 and 33001.5. If a petition meeting the requirements of Section 33002. 2 is filed, the board shall adopt a resolution approving the proposal to form a benefit district subject to confirmation by the voters of the benefit district.
After the board has adopted a resolution approving the proposal to form a benefit district under Section 33002.5, but before the board may levy any assessment, the board shall call an election in the benefit district for the purpose of submitting to the voters the proposition of levying the assessment by the benefit district. The resolution calling the election shall state each of the items required to be contained in the resolution adopted pursuant to Section 33001.5.
The board shall submit the proposition of levying an assessment to the voters of the benefit district in a special election to be held within 90 days following the adoption of the resolution calling an election. The provisions of the Elections Code relating to the manner of voting, the duties of election officers, the canvassing of returns, and all other particulars in respect to the management of elections, insofar as they may be applicable, shall govern all elections conducted pursuant to this chapter.
Ballots for the special election may be distributed to voters by mail with return postage prepaid, and shall be received by the district either by mail or hand delivery at the address shown on the postage prepaid envelope no later than 5:00 p.m. on the special election day.
The district shall pay to the county the reasonable expenses that the county incurs in conducting an election under this chapter, and the district may expend funds collected from the benefit assessment approved pursuant to the election for this purpose.
If a majority of the votes cast at the election conducted under this chapter approve the proposition, the board may levy the assessment pursuant to the resolution adopted pursuant to Section 33002.
Any owner or owners of real property, which is, in whole or in part, within the benefit district, or their legal representatives, may jointly or severally file with the board a petition requesting that the real property owned by them or for which they are the legal representative be excluded from the benefit district on the ground that the real property sought to be excluded is not benefited or that the assessment be reduced on the ground that the assessment exceeds the benefit to that real property.
The real property sought to be excluded or upon which the assessment is sought to be reduced shall be described by its legal description and shall be accompanied by a map depicting its location in relation to the benefit district.
The petition shall contain a statement of facts in support of the petition and shall be acknowledged by the owner or the legal representative filing the petition.
Notice of each hearing upon the petition for exclusion or reduction shall be given in accordance with subdivisions (d) and (e) of Section 33001.
At the time and place provided in the notice or at any time and place to which the hearing is adjourned, the board or its appointed hearing officer shall hear all the following:
The petition for exclusion or reduction.
All evidence or proofs that may be introduced by or on behalf of the petitioners.
All objections to the petition that may be presented in writing by any person, including the district.
All evidence or proofs that may be introduced in support of objections to the petition.
The expenses of giving the notice provided for herein and of the hearing on the exclusion or reduction petition shall be paid by the persons filing the petition.
Upon the hearing on an exclusion or reduction petition by the board, or upon the record of hearing by a hearing officer, the board shall order the petition be denied when the petitioner has not shown by a preponderance of the evidence that in an exclusion petition his or her real property is not benefited or in a reduction petition that the assessment exceeds the benefit to the property.
The board, after the hearing on an exclusion or reduction petition, shall order one of the following by resolution:
In the case of an exclusion petition, order the exclusion of all or any part of the real property described in the petition upon its finding that the property will not be benefited by the operations of the district in the vicinity of the benefit district.
In the case of a reduction petition, order a change in the benefit assessment to all or any portion of the real property described in the petition to provide that it not exceed the amount of benefit derived by the operations of the district in the vicinity of the benefit district.
Confirm the assessment on the real property subject to the petition as correctly reflecting the amount of benefit to the real property.
Following formation of the benefit district or concurrently therewith, if the board deems it necessary to incur a bonded indebtedness for the acquisition, construction, development, joint development, completion, operation, maintenance, or repair of one or more rail transit stations and related rail transit facilities located within the benefit district, the board may provide, by resolution, that the bonded indebtedness shall be payable from special benefit assessments levied within the benefit district. The resolution shall be adopted by a two-thirds vote of the members of the board, and shall declare and state all of the following:
That the board intends to incur an indebtedness, by the issuance of bonds of the district, for the benefit district which the board has formed, or intends to form, within a portion of the district.
The purposes for which the proposed debt is to be incurred, which may include all costs and estimated costs necessary or convenient for, incidental to, or connected with the accomplishment of the purposes, including, without limitation, engineering, inspection, legal, fiscal agent, financial consultant, bond and other reserve funds, working capital, bond interest estimated to accrue during the construction period, if any, and for a period not exceeding three years thereafter, and the expenses of all proceedings for the authorization, issuance, and sale of the bonds.
The estimated cost of accomplishing the purposes and the amount of the principal of the indebtedness to be incurred.
That a general description of the benefit district and of each zone, if any, therein and maps showing the exterior boundaries thereof are on file with the secretary of the district and available for inspection by any interested person.
That special benefit assessments for the payment of the bonds, and the interest thereon, have been or shall be levied in the benefit district or zones therein by the parcel area of unimproved real property and by the parcel area and the floor area of real property and improvements thereto of improved real property, as deemed appropriate by a resolution adopted by a two-thirds vote of the members of the board, at rates which are sufficient in the aggregate, together with revenues already collected and available therefor, to pay the principal of, and interest on, all bonds of the district issued for the benefit district.
The extent to which, if at all, all or a portion of the revenues of the district are to be used to pay the principal of, interest on, and sinking fund payments for, the bonds, including the establishment and maintenance of any reserve fund therefor.
The time and place set for hearing on the proposed issuance of the bonds.
That at the same time as the Board of Supervisors of the County of Los Angeles is required by law to fix the general tax levy and in the manner provided for the general tax levy, the district board shall levy and collect special benefit assessments in the benefit district or zones therein by the parcel area of unimproved real property and by the parcel area and the floor area of real property and improvements thereto of improved real property, as deemed appropriate by the district board, at rates which are sufficient in the aggregate, together with revenues already collected and available therefor, to pay the interest on the bonds as it becomes due, and the part of the principal of the bonds, including sinking fund installments required by any of the district’s agreements with bondholdlers, as will become due before proceeds of a special benefit assessment, levied at the time of the next general tax levy, will be available for those purposes; and to provide or to restore the bond reserve fund to the amount required by any of the district’s agreements with bondholders.
The maximum term the proposed bonds shall run before maturity, which shall not exceed 40 years from the date of the bonds or any series thereof.
The maximum rate or rates of interest to be paid, which shall not exceed 12 percent per annum.
That the pledge of special benefit assessment revenues to the bonds authorized by this section has priority over the use of any of those revenues for pay-as-you-go financing, except to the extent that this priority is expressly restricted by any of the district’s agreements with bondholders.
The notice stating the time and place of the hearing on the proposed issuance of bonds shall be published prior to the time fixed for the hearing pursuant to Section 6066 of the Government Code.
Notice shall also be mailed at least 30 days prior to the hearing to all owners of real property within the boundaries of the benefit district whose names and addresses appear on the last equalized assessment roll or are otherwise known to the Board of Supervisors of the County of Los Angeles or to the district.
At the time and place fixed for the hearing on the issuance of bonds payable from special benefit assessments levied under this chapter, or at any time and place to which the hearing is adjourned, the board shall proceed with the hearing. Interested persons may appear at the hearing and present matters material to the questions set forth in the resolution. At the conclusion of the hearing on the proposed issuance of bonds, the board shall, by resolution adopted by a two-thirds vote of the members, determine whether to incur the bonded indebtedness.
The resolution shall state the amount of the proposed debt, the purposes for which it is to be incurred, and the estimated cost of accomplishing the purposes. The determinations made in the resolution are final and conclusive.
Special benefit assessments for the payment of the principal of, and interest on, bonds issued for a benefit district shall be levied in the benefit district at rates which are sufficient in the aggregate, together with revenues already collected and available therefor, to pay the principal of, and interest on, all bonds of the district issued for the benefit district. Other revenues of the district shall be used for the payment of the principal of, and interest on, the bonds only to the extent set forth in any agreement of the district for the benefit of bondholders.
Special benefit assessments in the benefit district and zones, if any, therein shall be calculated to reflect, as accurately as possible, the benefit received by the property assessed in the benefit district or zones, if any, therein as a result of the project to be financed thereby.
The bonds issued pursuant to this chapter shall bear interest at a rate or rates not exceeding 12 percent per annum, payable semiannually, except that the first interest payable on the bonds or any series thereof may be for any period not to exceed one year as determined by the board.
In the resolution or resolutions providing for the issuance of bonds, the board may also provide for call and redemption of the bonds prior to maturity at times and prices and upon any other terms that it may specify. However, no bond is subject to call or redemption prior to maturity unless the bond contains a recital to that effect. The denomination or denominations of bonds shall be stated in the resolution providing for their issuance, but shall not be less than five thousand dollars ($5,000). The principal of, and interest on, the bonds shall be payable in lawful money of the United States at the office of the treasurer of the district or at any other place or places that may be designated by the board, or at either place or places at the option of the holders of the bonds. The bonds shall be dated, numbered consecutively, signed by the president and treasurer, and countersigned by the secretary and shall have the official seal of the district attached. The interest coupons of the bonds shall be signed by the treasurer. The seal and all signatures and countersignatures may be printed, lithographed, or mechanically reproduced, except that one signature or countersignature shall be manually affixed.
If an officer, whose signature or countersignature appears on the bonds or coupons, leaves office for any reason prior to the delivery of the bonds, the officer’s signature is as effective as if the officer had remained in office.
The bonds issued pursuant to this chapter may be sold as the board determines by resolution. The board may sell the bonds at a price below par.
If the board determines by resolution that the bonds shall be sold by competitive bid, the board, before selling the bonds, or any part thereof, shall give notice inviting sealed bids in the manner that it prescribes. If satisfactory bids are received, the bonds offered shall be awarded to the highest responsible bidder. If no bids are received, or if the board determines that the bids received are not satisfactory as to price or responsibility of the bidders, the board may reject all bids received, if any, and either readvertise or sell the bonds at private sale or by negotiation, or by other lawful means.
If the board determines by resolution that the bonds shall not be sold by competitive bid, the board may sell the bonds at public or private sale, by negotiation, or by other lawful means.
Delivery of any bonds issued under this chapter may be made at any place either inside or outside the state, and the purchase price may be received in cash or bank credits.
All accrued interest and premiums received on the sale of bonds issued by the district pursuant to this chapter shall be placed in the fund to be used for the payment of principal of, and interest on, those bonds. The remainder of the proceeds received on the sale of the bonds shall be placed in the treasury to secure those bonds or for the purposes for which the debt was incurred.
When the purposes for which the debt was incurred have been accomplished, any money remaining shall be either (a) transferred to the fund to be used for the payment of principal of, and interest on, the bonds or (b) placed in a fund to be used for the purchase of those outstanding bonds of the district, from time to time, in the open market at the prices and in the manner, either at public or private sale or otherwise, that the board determines. Bonds so purchased shall be canceled immediately.
The board may provide for the issuance, sale, or exchange of refunding bonds to redeem or retire any bonds issued by the district under this chapter upon the terms, at the times, and in the manner that it determines. Refunding bonds may be issued in a principal amount sufficient to pay all, or any part, of the principal of the outstanding bonds issued under this chapter, the interest thereon, and the premiums, if any, due upon call and redemption thereof prior to maturity and all expenses of the refunding.
The provisions of this chapter, for the issuance and sale of bonds apply to the issuance and sale of refunding bonds, except that, when refunding bonds are to be exchanged for outstanding bonds, the method of exchange shall be as determined by the board.
Any bonds issued under this chapter are legal investment for all trust funds; for the funds of insurance companies, commercial and savings banks, and trust companies; for state school funds; and, whenever any money or funds may, by any law now or hereafter enacted, be invested in bonds of cities, counties, school districts, or other districts within this state, the money or funds may be invested in the bonds issued under this chapter.
Whenever bonds of cities, counties, school districts, or other districts within this state may, by any law now or hereafter enacted, be used as security for the performance of any act or the deposit of any public money, bonds issued under this chapter may be so used.
The provisions of this chapter are in addition to all other laws relating to legal investments and are controlling as the latest expression of the Legislature with respect thereto.
The board may change the purposes for which any proposed debt is to be incurred, the estimated cost, the amount of bonded debt to be incurred, or the boundaries of the benefit district or zones, if any, therein or one or all of those matters, except that the board shall not change the boundaries to include any territory which will not, in its judgment, be benefited by the district action.
For all purposes of this chapter, it is conclusively presumed that any right-of-way of a common carrier will not be benefited by the district action.
The board shall not change the purposes, the estimated cost, the boundaries of the benefit district or zones, if any, therein, or the amount of bonded debt to be incurred until after it gives notice of its intention to do so, stating each proposed change in the purpose and stating, if applicable, that the exterior boundaries proposed to be changed are set forth on a map on file with the secretary of the district. The notice shall also specify the time and place set for hearing.
The notice shall be published prior to the time set for the hearing pursuant to Section 6066 of the Government Code.
The notice shall also be mailed at least 30 days prior to the hearing to all owners of real property affected by the proposed change whose names and addresses appear on the last equalized assessment roll or are otherwise known to the Board of Supervisors of the County of Los Angeles or to the district.
At the time and place fixed for a hearing on changes, or at any time and place to which the hearing is adjourned, the board shall proceed with the hearing. At the hearing, interested persons may appear and present matters material to the changes set forth in the notice.
At the conclusion of the hearing, the board shall, by resolution, determine whether to make any or all of the changes set forth in the notice. The determinations made in the resolution are conclusive and final.
All decisions and determinations of the board, upon notice and hearing, are final and conclusive upon all persons entitled to appeal to the board as to all errors, informalities, and irregularities which the board might have avoided or remedied during the progress of the proceedings or which it can, at that time, remedy.
Any objection, appeal, or protest not made at the time of any hearing is deemed to be waived voluntarily by any person who might have made the appeal, protest, or objection, and the person is deemed to have consented to the action taken following the hearing and any other matter on which objection, protest, or appeal could have been made.
Any action or proceeding, other than a petition for election pursuant to Section 33002.2, which contests, questions, or denies the validity or legality of the formation of any benefit district or zone, the issuance of any bonds therefor pursuant to this chapter, or any proceedings relating thereto, shall be commenced within six months from the date of the formation; otherwise, the formation of the benefit district or zone, the issuance of the bonds, and all proceedings relating thereto shall be held to be in every respect valid, legal, and incontestable.
When the board has imposed a special benefit assessment, the secretary shall so certify to the assessor of the county in which the territory of any benefit district is located and deliver to the assessor copies of all maps and diagrams of the benefit district and zones, if any, therein, indicating the amount of the special benefit assessment to be levied within the benefit district and zones, if any, therein.
Special benefit assessments authorized by this chapter shall be levied and collected by the county at the same time and in the same manner as taxes are levied and collected. The county may deduct its reasonable expenses of collection and shall transmit the balance of the assessments to the district.
In the event of conflict with any other law, the provisions of this chapter shall prevail with respect to benefit districts within the district.
Notwithstanding any other provision of this chapter, the district shall not pledge any portion of its general fund revenues to pay any part of any bonded indebtedness incurred under this chapter unless required by provisions of the California Constitution.
Notwithstanding Section 5097 of the Revenue and Taxation Code, any petition or claim for refund seeking an exclusion of real property or the reduction of an assessment on any grounds for the 2004–05 fiscal year or in any subsequent fiscal year pursuant to this chapter shall be filed within two years after the making of the payment sought to be refunded.
PART 4. ORANGE COUNTY TRANSIT DISTRICT [40000. - 40617.]
CHAPTER 1. General Provisions [40000. - 40014.]
ARTICLE 1. Definitions [40000. - 40006.]
This part shall be known and cited as the “Orange County Transit District Act of 1965.”
Unless the context otherwise requires, the provisions of this article govern the construction of this part.
“District” means the Orange County Transit District formed under this part.
“Board” means the board of directors of this district.
“Voter” means any elector who is registered under the Elections Code.
“Transit” means the transportation of passengers only and their incidental baggage by means other than by chartered bus, sightseeing bus, or any other motor vehicle not on an individual passenger fare-paying basis and includes carpools and ridesharing in private vehicles. Nothing in this section shall be construed to prohibit the district from leasing its buses to private certified public carriers or to prohibit the district from providing schoolbus service for the transportation of pupils between their homes and schools.
“Transit works” or “transit facilities” means all real and personal property, equipment, rights, or interests owned or to be acquired by the district for transit service.
ARTICLE 2. General Provisions [40010. - 40014.]
It is necessary that a transit district be established in Orange County in order to provide an interim solution to the transit problem of this area pending inclusion, if at all, of Orange County into the Southern California Rapid Transit District. The problem is unique in that presently there are several existing transportation facilities serving various parts of the area but independently operated, without interchange of transportation services, and without possibility of merger. The geographic location of the area requiring transportation services makes it necessary to develop a single transit system to protect the public interest.
It shall be the ultimate purpose of the Orange County Transit District to establish, when financing therefor becomes feasible, a permanent rapid transit system designed to be part of a unified Los Angeles-Orange County areawide regional system. When such permanent system is planned it shall incorporate physical characteristics necessary for full compatibility with the system of the Southern California Rapid Transit District, and unified management of the operations of such an areawide system shall be provided. Such unified management may be provided by management or operating contract with, or by annexation of the Orange County Transit District to, the Southern California Rapid Transit District or by any other lawful means; and shall take into full account the financial burdens already assumed by the citizens of the area comprising the Los Angeles Rapid Transit District to establish its system, which should be recognized in the operation of the unified system. The share of such financial burdens to be assumed by the Orange County Transit District, determined by its board by agreement with the board of the Southern California Rapid Transit District to be in the best mutual interest of the citizens of the two districts, may be made payable out of bond proceeds (subject to authorization of the bonds at an election), tax levies or any other available funds and may be made payable at such times and upon such rate of interest and other terms as shall be agreed between the boards of the two districts.
The Orange County Transit District as created and established by the voters of the County of Orange comprises all that portion of the County of Orange lying within the exterior boundaries thereof.
Except as otherwise provided in this part elections shall be held and conducted and the result ascertained, determined, and declared in all respects as nearly as practicable in conformity with the general election laws of the state.
Except as otherwise provided in this part all ordinances and notices which are required to be published shall be published within the district pursuant to Section 6066 of the Government Code.
Whenever the signature of any officer or employee of a district or of any member of the retirement board or of any officer or employee of the retirement system is authorized or required under the provisions of this part, except in the single instance provided in Section 40243, the signature may be made by the use of a plate bearing facsimilies of such signatures.
CHAPTER 3. Internal Organization of District [40060. - 40098.]
ARTICLE 1. Government [40060. - 40062.]
The members of the Orange County Transportation Authority, comprised as specified by Section 130052, shall serve as the board of directors of the district.
The board of directors shall select one of its members as chairman.
The board shall determine the number of, and appoint the officers of the district. Any officer of the Orange County Transportation Authority may also serve as an officer of the district.
ARTICLE 2. Powers and Duties of Directors [40070. - 40081.]
The chairman is the presiding officer of the board and he shall vote on the propositions passed upon by the board.
The first meeting of the board shall be held within 10 days after the board of supervisors certifies the results of the election to the Secretary of State pursuant to Section 40050. The board may make its own rules of procedure and determine the place and time of its meeting.
The board shall select one of its members vice chairman, who shall preside in the absence of its chairman. The board shall provide for and select such officers as it deems necessary to conduct the affairs of the district.
All matters and things necessary for the proper administration of the affairs of the district which are not provided for in this part shall be provided for by the board.
The board shall supervise and regulate every transit facility owned and operated by the district, including the fixing of rates, rentals, charges and classifications, and the making and enforcement of rules, regulations, contracts, practices, and schedules, for or in connection with any transit facility owned or controlled by the district.
The board may either operate the transit system itself or a part thereof or it may contract with any other public or private agency or corporation to operate all or part of the transit system for the district or it may contract with any other public or private agency or corporation for the improvement in transit services, facilities, equipment or operations being operated and conducted by said agency or corporation in, and, or, out of, the district.
The board may, from time to time, contract for or employ any professional service required by the district or for the performance of work or services which cannot satisfactorily be performed by the regular employees of the district.
The board may contract for the services of a treasurer, auditor, counsel, clerk, and general manager.
The Auditor of the County of Orange shall provide the board with an annual audit of all books and accounts of the district, unless an audit by a certified public accountant or public accountant is otherwise provided by the board. The county auditor may make, or may contract with a certified public accountant or public accountant to make, the annual audit. Any costs incurred by the county auditor, including contracts with or employment of, a certified public accountant or public accountant, in making the audit pursuant to this section shall be borne by the district.
Where an audit of the district’s accounts and records is made by a certified public accountant or public accountant, the minimum requirements of the audit shall be prescribed by the State Controller and shall conform to generally accepted auditing standards. A report shall be filed with the Auditor of the County of Orange within 12 months of the end of the fiscal year under examination.
Payment of claims against the district and disbursement of district funds shall be in the manner provided for claims against a county and disbursements of funds of a county.
The board, however, may provide by resolution for the payment of claims against the district without the prior specific approval thereof by the board, subject to such conditions as prescribed by the board.
None of the territory which is within the district shall be annexed to any other transit district unless the board, by resolution, approves the annexation of such territory to such other transit district.
To facilitate the business of the district, the board may provide for the creation and administration of such funds as the needs of the district may require. The funds shall be disbursed in accordance with rules adopted by the board, and all payments from any fund shall be reported to the board.
ARTICLE 3. Meetings and Legislation [40085. - 40089.]
All meetings of the board shall be conducted in a manner prescribed by the Ralph M. Brown Act, Chapter 9 (commencing with Section 54950), Part 1, Division 2, Title 5 of the Government Code.
A majority of the board constitutes a quorum for the transaction of business.
The acts of the board shall be expressed by motion, resolution or ordinance. No ordinance, resolution or motion shall have any validity or effect unless passed by the affirmative votes of a majority of the directors. District ordinances shall be adopted in the same manner as provided for adoption of ordinances by a county.
The enacting clause of all ordinances shall be as follows: “Be it ordained by the board of directors of the Orange County Transit District.” All ordinances shall be signed by the chairman or vice chairman of the board and attested by the clerk.
ARTICLE 4. Other Officers [40095. - 40098.]
The board may appoint and fix the salary of a general manager who shall have full charge of the acquisition, construction, maintenance, and operation of the facilities of the district, and of the administration of the business affairs of the district.
The board may designate the Treasurer, the Auditor, the County Counsel, and the Clerk of the County of Orange as the treasurer, auditor, counsel, and clerk of the district, and the treasury of that county may be designated the depositary for district funds for such time as the board may determine. Any costs incurred by the Treasurer, Auditor, County Counsel, and Clerk of the County of Orange in performing services for the district shall be borne by the district.
The treasurer shall be the custodian of the funds of the district and shall make payments only upon warrants duly and regularly signed by the chairman of the board or any other person so authorized by the board. The treasurer shall keep an account of all receipts and disbursements.
Notwithstanding any other provision of law which requires warrants to be paid by the county auditor, the district treasurer shall pay the warrant if sufficient district funds are available.
In the event that the district designates the treasury of the County of Orange to be the depository of district funds and the county auditor is not designated as the district auditor, a listing of warrants issued by the district shall be submitted to the county auditor, upon his request, on the same day the warrants are issued. The form and content of the warrant listing shall be as prescribed by the board and approved by the county auditor.
CHAPTER 4. Labor Provisions [40120. - 40129.]
Whenever a majority of the employees employed by the district in a unit appropriate for collective bargaining indicate a desire to be represented by a labor organization, the district, upon determining as provided in Section 40122 that the labor organization represents the employees in the appropriate unit, shall enter into a written contract with the accredited representative of those employees governing wages, salaries, hours, and working conditions. In case of a dispute over wages, salaries, hours, or working conditions, which is not resolved by negotiations in good faith between the district and the labor organization, upon the request of both, the district and the labor organization may submit the dispute to the decision of the majority of an arbitration board, and the decision of the majority of the arbitration board shall be final. The arbitration board shall be composed of two representatives of the district, and two representatives of the labor organization, and they shall endeavor to agree upon the selection of the fifth member. If they are unable to agree, the names of five persons experienced in labor arbitration shall be obtained from the California State Mediation and Conciliation Service. The labor organization and the district shall, alternately, strike a name from the list so supplied, and the name remaining after the labor organization and the district have stricken four names, shall be designated as the arbitrator. The labor organization and the district shall determine by lot who shall first strike from the list. The decision of a majority of the arbitration board shall be final and binding upon the parties thereto. The expenses of arbitration shall be borne equally by the parties. Each party shall bear his or her own costs.
No contract or agreement shall be made with any labor organization, association, group, or individual, or be assumed under the provisions of this section, where such organization, association, group, or individual denies membership to or in any manner discriminates against any employee on the grounds of race, creed, color or sex; provided, that such organization may preclude from membership any individual who advocates the overthrow of the government by force or violence. The district shall not discriminate in regard to employment against any person because of his race, creed, or color.
If there is a question whether a labor organization represents a majority of employees or whether the proposed unit is or is not appropriate, such matters shall be submitted to the State Conciliation Service for disposition. The State Conciliation Service shall promptly hold a public hearing after due notice to all interested parties and shall thereupon determine the unit appropriate for the purposes of collective bargaining. In making such determination and in establishing rules and regulations governing petitions, the conduct of hearings and elections, the State Conciliation Service shall be guided by relevant federal law and administrative practice, developed under the Labor-Management Relations Act, 1947, as presently amended.
The State Conciliation Service shall provide for an election to determine the question of representation and shall certify the results to the parties. Any certification of a labor organization to represent or act for the employees in any collective bargaining unit shall not be subject to challenge on the grounds that a new substantial question of representation within such collective bargaining unit exists until the lapse of one year from the date of certification or the expiration of any collective bargaining agreement, whichever is later; provided, that no collective bargaining agreement shall be construed to be a bar to representation proceedings for a period of more than two years.
The Public Employment Relations Board established pursuant to Section 3541 of the Government Code, and the powers and duties of that board, as described in Section 3541.3 of the Government Code, shall apply, as appropriate, to this chapter and shall include the authority as set forth in subdivision (b).
A complaint alleging any violation of this chapter or of any rules and regulations adopted by the district shall be processed as an unfair practice charge by the Public Employment Relations Board. The initial determination as to whether the charge of unfair practice is justified and, if so, the appropriate remedy necessary to effectuate the purposes of this chapter, shall be a matter within the exclusive jurisdiction of the Public Employment Relations Board, except that in an action to recover damages due to an unlawful strike, the Public Employment Relations Board shall have no authority to award strike-preparation expenses as damages, and shall have no authority to award damages for costs, expenses, or revenue losses incurred during, or as a consequence of, an unlawful strike. The Public Employment Relations Board shall apply and interpret unfair labor practices consistent with existing judicial interpretations of this chapter.
The Public Employment Relations Board shall not find it an unfair practice for an employee organization to violate a rule or regulation adopted by a public agency if that rule or regulation is itself in violation of this chapter. This subdivision shall not be construed to restrict or expand that board’s jurisdiction or authority as set forth in subdivisions (a) and (b).
Any charging party, respondent, or intervenor aggrieved by a final decision or order of the Public Employment Relations Board in an unfair practice case, except a decision of that board not to issue a complaint in such a case, may petition for a writ of extraordinary relief from that decision or order.
A petition for a writ of extraordinary relief shall be filed in the district court of appeal having jurisdiction over the county where the events giving rise to the decision or order occurred. The petition shall be filed within 30 days from the date of the issuance of the Public Employment Relations Board’s final decision or order, or order denying reconsideration, as applicable. Upon the filing of the petition, the court shall cause notice to be served upon the Public Employment Relations Board and thereafter shall have jurisdiction of the proceeding. The Public Employment Relations Board shall file in the court the record of the proceeding, certified by that board, within 10 days after the clerk’s notice unless that time is extended by the court for good cause shown. The court shall have jurisdiction to grant any temporary relief or restraining order it deems just and proper, and in like manner to make and enter a decree enforcing, modifying, and enforcing as modified, or setting aside in whole or in part the decision or order of the Public Employment Relations Board. The findings of the Public Employment Relations Board with respect to questions of fact, including ultimate facts, if supported by substantial evidence on the record considered as a whole, shall be conclusive. Title 1 (commencing with Section 1067) of Part 3 of the Code of Civil Procedure relating to writs shall, except where specifically superseded by this section, apply to proceedings pursuant to this section.
If the time to petition for extraordinary relief from a Public Employment Relations Board decision or order has expired, the Public Employment Relations Board may seek enforcement of any final decision or order in a district court of appeal or superior court having jurisdiction over the county where the events giving rise to the decision or order occurred. The Public Employment Relations Board shall respond within 10 days to any inquiry from a party to the action as to why the Public Employment Relations Board has not sought court enforcement of the final decision or order. If the response does not indicate that there has been compliance with the Public Employment Relations Board’s final decision or order, the Public Employment Relations Board shall seek enforcement of the final decision or order upon the request of the party. The Public Employment Relations Board shall file in the court the record of the proceeding, certified by that board, and appropriate evidence disclosing the failure to comply with the decision or order. If, after hearing, the court determines that the order was issued pursuant to the procedures established by the Public Employment Relations Board and that the person or entity refuses to comply with the order, the court shall enforce the order by writ of mandamus or other proper process. The court may not review the merits of the order.
Whenever the district acquires existing facilities from a publicly or privately owned public utility, either in proceedings by eminent domain or otherwise, the district shall assume and observe all existing labor contracts. To the extent necessary for operation of facilities, all of the employees of such acquired public utility whose duties pertain to the facilities acquired shall be appointed to comparable positions in the district without examination, subject to all the rights and benefits of this part, and these employees shall be given sick leave, seniority, vacation and pension credits in accordance with the records and labor agreements of the acquired public utility. Members and beneficiaries of any pension or retirement system or other benefits established by that public utility shall continue to have the rights, privileges, benefits, obligations and status with respect to such established system. No employee of any acquired public utility shall suffer any worsening of his wages, seniority, pension, vacation or other benefits by reason of the acquisition.
The district may extend the benefits of this section to officers or supervisory employees of the acquired utility.
Except as otherwise provided in Chapter 6.5 (commencing with Section 40221) of this part, the district shall not acquire any existing system or part thereof whether by purchase, lease, condemnation, or otherwise. The district shall not dispose of or lease to any transit system or part thereof, nor merge, consolidate or coordinate any transit system or part thereof, or reduce or limit the lines or service of any existing system or of its system, or terminate any lease arrangement or management contract, unless it shall first give notice of such contemplated action to the collective bargaining agent of the employees who are or may be affected thereby. The terms and conditions of employment affected by such action shall be a proper subject of collective bargaining.
Notwithstanding the provisions of the Government Code, employees of this district may authorize and, upon such authorization, the district may make deductions from wages and salaries of such employees:
Pursuant to a collective bargaining agreement with a duly designated or certified labor organization for the payment of union dues, fees, or assessments.
For the payment of contributions pursuant to any health and welfare plan or pension or retirement plan.
For any purpose for which deductions may be authorized by employees of any private employer.
The obligation of the district to bargain in good faith with a duly designated or certified labor organization and to execute a written collective bargaining agreement with such labor organization covering the wages, hours and working conditions of the employees represented by such labor organization in an appropriate unit, and to comply with the terms thereof shall not be limited or restricted by the provisions of the Government Code or other laws or statutes and the obligation of the district to bargain collectively shall extend to all subjects of collective bargaining which are or may be proper subjects of collective bargaining with a private employer, including retroactive provisions. Notwithstanding the provisions of the Government Code or other laws or statutes, the district shall make deductions from wages and salaries of its employees upon receipt of authorization therefor for the payment of union dues, fees or assessments, for the payment of contributions pursuant to any health and welfare plan or pension plan or for any other purpose for which deductions may be authorized by employees of any private employer, where such deductions are pursuant to a collective bargaining agreement with a duly designated or certified labor organization.
The district may provide for a retirement system; provided, that the adoption, terms and conditions of any retirement system covering employees of the district represented by a labor organization in accordance with this section shall be pursuant to a collective bargaining agreement between such labor organization and the district.
The district shall take the necessary steps to obtain coverage for the district and its employees under Subchapter II of the federal Social Security Act, as amended, and the related provisions of the Federal Insurance Contributions Act, as amended.
However, the district is not required to provide coverage under Subchapter II of the federal Social Security Act, as amended, for employees who are members of the Orange County Employees Retirement System. Notwithstanding Section 31557 of the Government Code, administrative and professional employees may be admitted to membership in the Orange County Employees Retirement System without making membership applicable to all employees of the district. The board, by resolution, shall determine which employees are employed in administrative and professional classifications.
The district shall take such steps as may be necessary to obtain coverage for the district and its employees under the workers’ compensation, unemployment compensation disability and unemployment insurance laws of the State of California.
CHAPTER 5. Retirement System [40130. - 40130.]
The Orange County Employees Retirement System and the laws relating thereto or as hereafter amended shall be applicable to the officers and employees of the district, except as otherwise provided in Chapter 4 (commencing with Section 40120) of this part.
CHAPTER 6. Powers and Functions of District [40160. - 40201.]
ARTICLE 1. Corporate Power [40160. - 40163.]
The district has perpetual succession and may adopt a seal and alter it at its pleasure.
The district may sue and be sued, except as otherwise provided by law, in all actions and proceedings, in all courts and tribunals of competent jurisdiction.
The district may exercise the right of eminent domain to take any property necessary or convenient to the exercise of the powers granted in this part. The district in exercising such power shall, in addition to the damage for the taking, injury or destruction of property, also pay the cost of removal, reconstruction or relocation of any structure, railway, mains, pipes, conduits, cables or poles of any public utility which is required to be moved to a new location.
No such taking or acquisition by the district which would involve the abandonment, removal, relocation, or use of property of a railroad corporation, as defined in Section 230 of this code, shall be permitted, unless the Public Utilities Commission, after hearing, shall find and determine that the public interest and necessity require the abandonment, removal, relocation, or use of such property and that such taking or acquisition will not unreasonably impair the ability of the railroad corporation involved to provide safe, adequate, economical, and efficient service.
All the provisions of the County Transportation Commissions Act (Division 12 (commencing with Section 130000)), regarding the powers and functions of the Orange County Transportation Authority shall be equally applicable to the Orange County Transit District as if set forth herein, and shall be in addition to the powers and functions set forth in this part. The board of directors shall determine which provisions are applicable to the conduct of the district.
ARTICLE 2. Contracts [40165. - 40166.]
The district may make contracts and enter into stipulations of any nature whatsoever, either in connection with eminent domain proceedings or otherwise, including, without limiting the generality of the foregoing, contracts and stipulations to indemnify and hold harmless, to employ labor, and to do all acts necessary and convenient for the full exercise of the powers granted in this part.
No officer or employee of the district shall in any manner be interested, directly or indirectly, in any contract awarded or to be awarded by the board, or in the profits to be derived therefrom contrary to the provisions of Article 4 (commencing with Section 1090), Chapter 1, Division 4, Title 1 of the Government Code.
ARTICLE 4. Property [40175. - 40176.]
The district may take by grant, purchase, gift, devise or lease, or condemn in proceedings under eminent domain, or otherwise acquire, and hold and enjoy, real and personal property of every kind within or without the district necessary to the full or convenient exercise of its powers. The board may lease, mortgage, sell, or otherwise dispose of any real or personal property within or without the district when in its judgment it is for the best interests of the district so to do.
Exercise of the powers provided under Section 40175 shall be undertaken in the same manner and pursuant to the same procedures as in the exercise of like powers by the County of Orange, except as may otherwise be expressly provided in this part.
ARTICLE 5. Transit Facilities and Service [40180. - 40187.]
The district may acquire, construct, own, operate, control or use rights-of-way, rail lines, buslines, stations, platforms, switches, yards, terminals and any and all other facilities necessary or convenient for transit service within or partly without the district underground, upon or above the ground and under, upon or over public streets or other public ways, or waterways, together with all physical structures necessary or convenient for the access of persons or vehicles thereto and may acquire any interest in or rights to the joint use of any or all of the foregoing; provided that:
Installations in state freeways shall be subject to the approval of the State Department of Public Works and installations in other state highways shall be subject to Article 2 (commencing with Section 670), Chapter 3, Division 1 of the Streets and Highways Code.
Installations in city streets, parks, or other property devoted to municipal use, shall be subject to the approval of the city council having jurisdiction thereof.
The district may acquire, contract and negotiate for the services of any and all employees of any public or private agency or corporation operating transit facilities within the district.
The district may make bulk purchases of passenger tickets for scheduled passenger rail services provided by the National Railroad Passenger Corporation during peak hours, as defined by subdivision (a) of Section 99260.2, on Monday through Friday, inclusive.
The district may resell to residents of the district the tickets at less than the cost to the district.
The district may without limitation by any other provisions of this part requiring approval of indebtedness, accept contributions of money, rights-of-way, labor, materials, and any other property for the acquisition, construction, maintenance, and operation of transit facilities, and may without limitation by any other provisions of this part enter into any contracts and cooperation with and accept cooperation from the state, or any department, instrumentality, or agency thereof, or any public agency in the acquisition, construction, maintenance, and operation of, and in financing the acquisition, construction, maintenance, and operation of, any such transit facilities.
The district may acquire, construct, own, or operate air terminal facilities within the district and, with the consent of the county in which such facilities are located, outside of the district, and may accept contributions of money, labor, materials, and any other property from, and enter into any contract and cooperation with, the federal government or the state, or any department, instrumentality, or agency thereof, or any public agency for such purposes.
The district may lease or contract for the use of its transit facilities, or any portion thereof, to any operator, and may provide for subleases by such operator upon such terms and conditions as it deems in the public interest. The word “operator” as used in this section means any city or public agency or any person, firm or private corporation.
The district may construct and operate or acquire and operate works and facilities in, under, upon, over, across, or along any street or public highway or any stream, bay or watercourse, or over any of the lands which are the property of the state, to the same extent that such rights and privileges appertaining thereto are granted to municipalities within the state, and to install adequate bus stops, including the painting of curbs, subject to the governing body in charge of such streets, highways, stream, watercourse or lands.
The district may enter into agreements for the joint use of any property and rights by the district and any city, public agency or public utility operating transit facilities; may enter into agreements with any city, public agency or public utility operating any transit facilities, either wholly or partially within, or without, the district, for the joint use of any property of the district or of such city, public agency or public utility, or the establishment of through routes, joint fares, transfer of passengers or pooling arrangements.
The rates and charges for service furnished pursuant to this part shall be fixed by the board and shall be reasonable.
The district shall be subject to the provisions of Division 14.8 (commencing with Section 34500) of the Vehicle Code with respect to the operation of buses and to the rules and regulations prescribed by the Department of the California Highway Patrol pursuant to that chapter regulating the safe operation of buses.
ARTICLE 6. Indebtedness [40200. - 40201.]
The district shall have the power to obtain temporary transfers of funds in accordance with the last paragraph of Section 31, Article IV of the State Constitution.
The district may accept, without limitation by any other provisions of this part requiring approval of indebtedness, contributions or loans from the United States, this state, or any department, instrumentality, or agency of either thereof, for the purpose of financing the acquisition, construction, maintenance, and operation of transit facilities, and may enter into contracts and cooperate with, and accept cooperation from, the United States, this state, or any department, instrumentality, or agency of either thereof, in the acquisition, construction, maintenance, and operation, and in financing the acquisition, construction, maintenance, and operation of any such transit facilities in accordance with any legislation which Congress or the Legislature of the State of California may have heretofore adopted or may hereafter adopt, under which aid, assistance, and cooperation may be furnished by the United States or this state in the acquisition, construction, maintenance, and operation or in financing the acquisition, construction, maintenance and operation of any such transit facilities. The district may do any and all things necessary in order to avail itself of such aid, assistance, and cooperation under any federal or state legislation now or hereafter enacted. Any evidence of indebtedness issued under this section shall constitute a negotiable instrument.
CHAPTER 6.5. Existing Systems [40221. - 40224.]
As used in this chapter:
“Establish” includes establish, construct, complete, acquire, extend, or reroute. It does not, however, include the maintenance and operation of any existing system acquired by the district.
“Existing system” means any transit service or system of a publicly or privately owned public utility situated entirely within Orange County, or at least 75 percent of whose revenue vehicle miles for the preceding calendar year were operated within Orange County, and has been in operation since at least January 1, 1982.
Notwithstanding any other provision of this part, before the district may propose to establish any transit service or system which may at any time divert, lessen, or compete for the patronage or revenues of any existing system, the district shall give a written notice to the public utility which is operating the existing system. The written notice shall describe the transit service or system which the district proposes to establish and shall state the time within which the district proposes to establish the service or system.
The district shall not establish the proposed service or system, or maintain and operate the service or system until it has completed the purchase of the existing system or any part thereof.
The purchase price to be paid for the existing system, or any portion thereof to be purchased, shall be the reproduction cost new, including going concern value, at the date upon which the district commences negotiations for the purchase of the existing system, or the portion of the existing system, less depreciation, including wear, tear, and obsolescence, if any.
The district and the public utility operating the existing system may agree upon the purchase price or they may agree that the purchase price is to be established by arbitration and upon the method of naming arbitrators and the method of conducting such arbitration. If they do not, the purchase price may be fixed and judgment entered thereon in a suit brought either by the public utility or the district in the superior court in and for the county in which is located that portion of the existing system to be acquired by the district which has the highest value.
Section 851 does not apply to any contract for sale or sale of an existing system, or any portion thereof, pursuant to this chapter, and the Public Utilities Commission has no jurisdiction with respect thereto.
CHAPTER 7. Bonds [40225. - 40266.]
ARTICLE 1. Issuance [40225. - 40237.]
The district may from time to time incur a bonded indebtedness as provided in this chapter to pay the cost of acquiring, constructing or completing the whole or any portion of any transit facilities, or for acquiring any works, lands, structures, rights, equipment, or other property necessary or convenient to carry out the objects, purposes, or powers of the district. The total amount of bonds issued and outstanding shall not exceed twenty percent (20%) of the assessed value of the taxable property of the district as shown by the last equalized assessment roll of the County of Orange.
Whenever the board by resolution passed by vote of two-thirds of all its members determines that the public interest or necessity demands the acquisition, construction, or completion by the district of any transit facilities or any works, lands, structures, rights, equipment, or other property necessary or convenient to carry out the objects, purposes, or powers of the district, the cost of which will be too great to be paid out of the ordinary annual income and revenue of the district, it may at any subsequent meeting of the board provide by ordinance for the submission of the proposition of incurring a bonded indebtedness for the purpose set forth in the resolution to the voters of the district at a special bond election held for that purpose.
The ordinance calling a special bond election shall fix the date on which the election will be held, and the manner of holding the election and of voting for or against incurring the indebtedness. It shall also recite the objects and purposes for which the indebtedness is proposed to be incurred, the estimated cost of the transit facilities, works, lands, structures, rights, equipment, or other property proposed to be acquired, constructed, or completed, the amount of the principal of the indebtedness to be incurred therefor, and the maximum rate of interest to be paid on the indebtedness, which shall not exceed 6 percent per annum, payable semiannually or annually the first year and thereafter semiannually.
Propositions for incurring indebtedness for more than one object or purpose may be submitted at the same election.
Any special bond election may be held separately, or may be consolidated with any other election authorized by law at which the voters of the district may vote. If a special bond election is consolidated with any other election, the provisions of this chapter setting forth the procedure for the calling and holding of the special bond election shall be complied with, except that the ordinance calling the election need not set forth the election precincts, polling places, and officers of election, but may provide that the precincts, polling places, and officers of election shall be the same as those set forth in the ordinance, notice, or other proceedings calling the election with which the special bond election is consolidated, and shall refer to the ordinance, notice, or other proceedings by number and title, or by other definite description.
The ordinance shall be published, and no other notice of election need be given.
The board shall comply with Article 3 (commencing with Section 9160) of Chapter 2 of Division 9 of the Elections Code, the provisions of which are applicable to any bond election held pursuant to this article.
The votes of sixty percent (60%) of all voters voting on the proposition at the election are required to authorize the issuance of bonds under this chapter.
If the proposition submitted at a special bond election fails to receive the requisite number of votes, the board shall not within six months after the election hold another special election for the submission of a proposition of incurring a bonded indebtedness substantially the same as the proposition voted upon at the prior election unless a petition signed by voters within the district equal in number to at least 15 percent of the total vote cast at the last general statewide election is filed with the board, requesting that the proposition, or a proposition substantially the same, be submitted at an election to be called for that purpose.
ARTICLE 2. Form and Content [40240. - 40243.]
Bonds authorized by this chapter shall mature serially in amounts to be fixed by the board; except that payment shall begin not later than 10 years from the date thereof and shall be completed in not more than 50 years from that date.
The board may divide any issue of bonds authorized pursuant to this chapter into two or more series, and may fix different dates of issuance and different maturity dates for the bonds of each series. The bonds of each series shall mature serially in amounts to be fixed by the board, and the board shall fix a date not more than 10 years from the date of issuance of each series for the earliest maturity of such series, and shall fix a date not more than 50 years from the date of issuance of each series for the final maturity of such series.
Pending the actual issuance or delivery of bonds, a district may issue temporary or interim bonds, certificates, or receipts, of any denomination whatsoever, with or without coupon, and in such form as may be prescribed by the board, to be exchanged for definite bonds when ready for delivery.
The bonds shall be issued in such denominations as the board determines, except that no bonds shall be issued of a denomination less than one thousand dollars ($1,000) and shall be payable on the day and at the place or places fixed in the bond, and with interest at the rate specified therein, payable semiannually, except that interest for the first year after the date of the bonds may be made payable at the end of that year.
The board may at any time prior to the issuance and sale of any bonds provide for the call and redemption of any or all of the bonds on any interest payment date prior to their fixed maturity at not exceeding the par value and accrued interest plus a premium of not exceeding 5 percent upon the principal amount of the bonds, in which event the call price fixed by the board shall be set forth on the face of the bond. Notice of such redemption shall be published. If there is no newspaper of general circulation printed and published within the district, then the publication shall be made in a newspaper of general circulation printed and published within the county in which the district or any part thereof is situated. The first publication shall be at least 30 days prior to the date fixed for the redemption. After the date fixed for such redemption interest on the bonds thereafter shall cease.
The bonds shall be signed by the chairman of the board or by such officer of the district as the board shall by resolution authorize and designate for that purpose. They shall also be signed by the treasurer, and be countersigned by the auditor. The coupons of the bonds shall be numbered consecutively and be signed by the treasurer. All signatures and countersignatures, except one of the signatures or countersignatures on the bonds, may be printed, lithographed or engraved. If any officer whose signature or countersignature appears on the bonds or coupons ceases to be such officer before the delivery of the bonds to the purchaser, the signature or countersignature is nevertheless valid and sufficient for all purposes as if he had remained in office until the delivery of the bonds.
ARTICLE 3. Issue and Sale [40245. - 40246.]
The bonds may be issued and sold for not less than their par value, but otherwise as the board determines. Before selling any bonds, or any part thereof, the board shall give notice inviting sealed bids in such manner as the board may prescribe. If satisfactory bids are received, the bonds offered for sale shall be awarded to the highest responsible bidder. If no bids are received, or if the board determines that the bids received are not satisfactory as to price or responsibility of the bidders, the board may reject all bids received, if any, and either again give notice inviting bids or sell the bonds at private sale.
All premiums and accrued interest received on the sale of bonds shall be placed in the fund to be used for the payment of principal of and interest on the bonds. The remainder of the proceeds of the bonds shall be placed in the district treasury to the credit of the proper fund, and shall be used exclusively for the objects or purposes for which the bonds were voted; provided that when such objects and purposes have been accomplished any moneys remaining shall be transferred to the fund to be used for the payment of principal of and interest on the bonds, and that when all principal of and interest on the bonds shall have been paid, any balance of money then remaining shall be transferred to the general fund of the district.
ARTICLE 4. Status as Investments [40260. - 40261.]
All bonds including refunding bonds issued by a district are legal investments for all trust funds and for the funds of all insurance companies, banks, both commercial and savings, and trust companies, and for the State School Fund and for all sinking funds under the control of the State Treasurer. Whenever any money or funds may by law be invested in or loaned upon the security of bonds of cities, cities and counties, counties, or school districts, in the state, such money or funds may be invested in or loaned upon the security of the bonds of the district; and whenever bonds of cities, cities and counties, counties, or school districts by law may be used as security for the faithful performance or execution of any court or private trust or of any other act, bonds of the district may be so used.
All bonds of the district, to the same extent as bonds of any other municipality, are legal for use by any state or national bank or banks in the state as security for the deposit of funds of the state or of any county, city and county, city, municipality or other public or municipal corporation within the state.
ARTICLE 5. Validation [40263. - 40263.]
An action to determine the validity of bonds, including refunding bonds, may be brought pursuant to Chapter 9 (commencing with Section 860) of Title 10 of Part 2 of the Code of Civil Procedure.
ARTICLE 6. Revenue Bonds [40265. - 40266.]
As an alternative procedure for the raising of funds, the district may issue bonds, payable from revenues of any facility or enterprise to be acquired or constructed by the district, in the manner provided by the Revenue Bond Law of 1941 (Chapter 6 (commencing with Section 54300) of Part 1 of Division 2 of Title 5 of the Government Code), all of the provisions of which are applicable to the district.
The district is a local agency within the meaning of the Revenue Bond Law of 1941 (Chapter 6 (commencing with Section 54300) of Part 1 of Division 2 of Title 5 of the Government Code). The term “enterprise” as used in the Revenue Bond Law of 1941 shall, for all purposes of this part, include transit facilities and any and all parts thereof and all additions, extensions and improvements thereto and all other facilities authorized to be acquired, constructed or completed by the district. A district may issue revenue bonds under the Revenue Bond Law of 1941, for any one or more facilities or enterprises authorized to be acquired, constructed, or completed by a district or, in the alternative, may issue revenue bonds under the Revenue Bond Law of 1941, for the acquisition, construction and completion of any one of such facilities. Nothing in this article shall prevent the district from availing itself of, or making use of, any procedure provided in this part for the issuance of bonds of any type or character for any of the facilities or works authorized hereunder, and all proceedings may be carried on simultaneously or, in the alternative, as the directors may determine.
CHAPTER 8. Taxation [40300. - 40336.]
ARTICLE 1. Property Taxation [40300. - 40310.]
The district may levy and collect, or cause to be collected, taxes for any lawful purpose subject to a maximum limit of five cents ($0.05) per one hundred dollars ($100) of assessed valuation within the district exclusive of any tax levied to meet the bonded indebtedness of the district and the interest thereon.
If, in the opinion of the board, the transit operation revenues will not be sufficient for any and all lawful purposes, the board shall levy a tax for such purpose or purposes and fix the amount of money necessary to be raised therefor by taxation.
The board shall, as part of the general tax levy as set forth in Section 40300 levy and collect annually until the district’s bonds are paid, or until there is a sum in the treasury of the district set apart for that purpose to meet all sums coming due for principal and interest on the bonds as they become due, a tax sufficient to pay the annual interest on the bonds, and such part of the principal thereof, as becomes due before the proceeds of a tax levied at the next general tax levy will be available. If the maturity of the indebtedness created by the issue of bonds begins more than one year after the date of the issuance thereof, the tax shall be levied and collected annually at the time and in the manner stated above, in an amount sufficient to pay the interest on the indebtedness as it falls due and to constitute a sinking fund for the payment of the principal on or before maturity.
The board may provide for the assessment, levy, and collection of taxes by the district, including the sale of property to the district for delinquent taxes, with penalties, interest, and cost.
The board shall avail itself of the assessments made by the assessor of the county and of the assessments made by the State Board of Equalization for the county, and shall take such assessments as the basis for district taxation and have its taxes collected by the tax collector of the county.
In such case, the county auditor shall, on or before the third Monday in August of each year, transmit to the board a statement, in writing, showing the total value of all property within the district, ascertained from the assessments referred to in Section 40304 as equalized.
The board shall, on or before the first day of September, fix the rate of taxes, designating the number of cents upon each one hundred dollars ($100) using as a basis the value of property transmitted to the board by the county auditor, which rate of taxation shall be sufficient to raise the amount previously fixed by the board. These acts by the board shall constitute a valid assessment of the property and a valid levy of the taxes so fixed, but the rate of taxation shall not exceed the limit imposed by this article.
The board shall immediately, after fixing the rate of taxes as provided in Section 40306, transmit to the county auditor of the county a statement of the rate of taxes fixed by the board.
The district’s taxes so levied shall be collected at the same time and in the same manner as county taxes. When collected, the net amount, ascertained as provided in this article, shall be paid to the treasurer of the district under the general requirements and penalties provided by law for the settlement of other taxes.
Whenever any real property has been sold for taxes and has been redeemed, the money paid for redemption shall be apportioned and paid to the district by the county treasurer in the proportion which the tax due to the district bears to the total tax for which the property was sold.
All taxes levied under this article are a lien on the property on which they are levied. The enforcement of the collection of such taxes shall be in the same manner and by the same means provided by law for the enforcement of liens for county taxes, all the provisions of law relating to the enforcement of the latter being made a part of this article so far as applicable.
ARTICLE 2. Transactions and Use Taxes and Revenue Bonds [40330. - 40336.]
Transactions and use taxes (to be designated in the ballot proposition set forth in Section 40334 as a “sales tax”) may be imposed by the board in accordance with the provisions of Part 1.6 (commencing with Section 7251) of Division 2 of the Revenue and Taxation Code, except that the rate shall be as set forth in Section 40335.
Any transactions and use taxes ordinance adopted pursuant to this article shall be operative on the first day of the first calendar quarter commencing more than 120 days after the approval of such ordinance by the electors as provided in this article.
Prior to the operative date of the ordinance, the district shall contract with the State Board of Equalization to perform all functions incident to the administration and operation of the ordinance.
The revenues from the taxes imposed pursuant to this article may be used for any lawful purpose of the district.
During the first three years the taxes are imposed pursuant to this article, 25 percent of the revenues generated from such taxes shall be allocated by the district to Orange County and the cities therein in the proportion that the population of the county or city, as the case may be, bears to the total population of the district. For purposes of this subdivision, the population of the county shall be the population of the unincorporated territory of the county.
The revenues allocated pursuant to subdivision (b) shall be used by the county and the cities to finance public transit services, which shall be coordinated with the public transit services operated by the district. The county or any city may also use the revenues to finance public transit services operated by the district.
At the end of four years, as measured from the initial imposition of the taxes pursuant to this article, any of the revenues allocated pursuant to subdivision (b) which has not been expended for public transit services shall revert to the district.
The taxes authorized by this article shall not be imposed unless the board shall have authorized it by ordinance adopted by a vote of two-thirds of all members of the board and the ordinance shall be approved by two-thirds of the votes cast by the qualified electors of the district voting on the proposition at an election called for that purpose. The board, in the ordinance, shall state the nature of the tax to be imposed, shall provide the tax rate or rates or the maximum tax rate or rates, and shall specify the purposes for which the revenue derived from the tax will be used.
The actual wording of the proposition on any short form of ballot card, label, or other device, regardless of the system of voting used, shall read as follows:
The proposition shall set forth the actual percent of the transaction and use taxes upon which the electors are voting.
The sample ballot to be mailed to the voters, under Section 13303 of the Elections Code, shall be the full proposition as set forth in the ordinance adopted pursuant to Section 40333.
The board is authorized to impose a maximum tax rate of 1 percent under this article and the board may state the maximum tax rate in terms of not to exceed 1 percent, or any lesser percentage thereof. The district shall not levy the tax at a rate other than 1, 34, 12, or 14 percent, unless specifically authorized by the Legislature. The board, in the ordinance, may provide for limitations upon the time when the tax shall be in effect, or the board may provide that the tax shall be in effect until repealed. Any tax rate or maximum tax rate adopted pursuant to this article, unless otherwise prohibited, may be increased when authorized by the board by ordinance adopted in the manner and by the vote stated in Section 40333 and approved by a majority of the votes cast by the qualified electors of the district voting at an election called for that purpose.
The district is hereby authorized to issue revenue bonds, payable, in whole or in part, from revenues made available under this article. Such revenues are hereby declared to be revenues of the enterprise for all purposes of the Revenue Bond Law of 1941 (Chapter 6 (commencing with Section 54300), Part 1, Division 2, Title 5 of the Government Code), and the restrictions therein provided against the securing of bonds by the taxing power or the proceeds of taxation shall not apply. The district shall be deemed a “local agency” and the planning, acquiring, constructing, operating, or maintaining of the district’s transit facilities, or any part thereof, shall be deemed an “enterprise” within the meaning of the Revenue Bond Law of 1941. The provisions of such law not inconsistent with any of the provisions of this article are hereby made applicable to the district, except that no election shall be required for the issuance of bonds under such law which are secured, in whole or in part, by the revenues of the tax imposed pursuant to this article. The resolution or indenture authorizing the issuance of any revenue bonds secured, in whole or in part, by the revenues of the tax imposed pursuant to this article shall provide that use of such revenues by the district to redeem such bonds shall be continued in effect until such bonds are fully paid or provision has been made for their payment in full.
The district may borrow money in anticipation of the revenues made available under this article and may, from time to time, issue negotiable notes for that purpose.
In addition to pledging revenues for the payment of any revenue bonds, the district may pledge for the payment of such bonds all other income or receipts of the district which are not required by law to be used for other purposes.
CHAPTER 9. Dissolution [40500. - 40507.]
The board may call an election any time for the purpose of submitting to the voters of the district the question of whether the district will be dissolved. Upon the filing with the clerk of the district of a petition signed by voters within the district equal in number to at least twenty-five percent (25%) of the total vote cast within the district at the last general statewide election asking that the question of dissolution of the district be submitted to the voters of the district, the board shall call such an election.
The election for the purpose of submitting to the voters of the district the question of whether or not the district shall be dissolved shall be held on the next established election date not less than 74 days next succeeding the date on which the petition is filed.
Notice of any election for dissolution, whether called because of the filing of a petition or ordered by the board without petition, shall be published. The date fixed for the election shall not be less than 30 days from the date of the first publication of the notice.
The ballots for the election shall contain substantially the instructions required to be printed on ballots for use at general state and county elections and in addition the following:
The board shall canvass the vote. If a majority of the votes favor dissolution, the board shall by resolution dissolve the district.
The board shall file a certified copy of the resolution with the Secretary of State and for record in the office of the county recorder.
Upon dissolution the right, title, and interest to property owned or controlled by the district situated within the limits of any city vests absolutely in the city. If such property is situated outside the limits of a city, it vests in the county in which it is situated.
The board of supervisors is, ex officio, the governing body of the dissolved district. It may levy taxes and assessments and perform other acts necessary to wind up the district affairs and to raise money for the payment of outstanding indebtedness.
CHAPTER 10. Consolidation with Other Districts [40600. - 40617.]
The district may be consolidated with the Southern California Rapid Transit District organized and operating pursuant to Part 3 (commencing with Section 30000) of this division, in the manner provided in this chapter.
Whenever the board finds and determines that:
The Southern California Rapid Transit District is willing to annex the territory comprising the district;
The annexing district has adequate facilities for and is able to supply transit service to the district in a manner equal to or superior to that presently rendered by the district;
Annexation will not result in assumption of financial obligations by the taxpayers of the district disproportionate to the services which they will receive; the board shall thereafter negotiate an agreement with the annexing district specifying the terms and conditions of annexation and such other matters as are necessary and incidental thereto.
The board shall thereafter, by resolution setting forth the terms and conditions of the proposed contract at length, declare its intention to cause the agreement to be approved and effect consolidation of the district with the Southern California Rapid Transit District.
The resolution, together with a notice fixing the time and place for hearing thereon, shall be published once in a newspaper of general circulation published in the district. The time fixed for hearing shall not be less than 30 nor more than 60 days from the date of publication of such notice.
At the hearing any interested person may file with the board written objections to the approval of the terms and conditions of the proposed contract or the consolidation, or both the proposed contract and the consolidation.
Upon the hearing, the board shall determine whether or not the terms and conditions of the contract will be approved and the consolidation effected, and shall hear and determine all objections thereto.
Any hearing on the agreement and consolidation may be adjourned from time to time by the board, not exceeding 30 days in all, without further notice other than an order entered upon the minutes of the meeting fixing the time and place of adjournment.
If no protests are filed, or if the protests filed are overruled and denied by the board, the board shall thereupon by resolution finally approve the terms and conditions of the agreement and proceed with the consolidation.
At any time after the board of directors of the district has finally approved the agreement the Board of Supervisors of Orange County shall cause an election to be held in the district to determine whether the Orange County Transit District will be consolidated with the Southern California Rapid Transit District upon the terms and conditions stated in the agreement.
Notice of election shall be published once a week for two successive weeks (two publications) in a newspaper of general circulation published within the district, and shall either state that a copy of the consolidation agreement is on file in the office of the Clerk of Orange County, and open to the inspection of all persons interested, or set forth the terms and conditions of the consolidation agreement at length, in the discretion of the board of supervisors calling the election.
The ballots for the election shall contain substantially the instructions required to be printed on ballots for use at general state and county elections and in addition shall set forth the proposition of consolidation substantially as follows:
If upon a canvass of the election it is found that a majority of all votes cast on the proposition at the election were cast in favor of the consolidation, the proposition and all of the terms and conditions of the consolidation agreement shall be deemed carried and approved by the voters.
If the proposition fails to carry, the result shall be entered upon the minutes of the Board of Supervisors of Orange County.
If the proposition receives the vote of the requisite majority of voters, the Board of Supervisors of Orange County shall enter in its minutes an order declaring the result of the election and shall thereupon cause the consolidation agreement to be executed by its duly authorized officers.
Upon receipt by the Southern California Rapid Transit District of a copy of the consolidation agreement properly executed by the district and Orange County the board of directors of the Southern California Rapid Transit District shall pass a resolution declaring the Orange County Transit District consolidated with the Southern California Rapid Transit District, and shall cause a certified copy of the resolution to be filed with the Secretary of State. From and after the date of filing of the resolution with the Secretary of State the consolidation of the Orange County Transit District with the Southern California Rapid Transit District is complete.
From and after the date of consolidation the board of directors of the Southern California Rapid Transit District shall levy upon all of the property in the former Orange County Transit District such taxes, tolls, or charges as are necessary to provide funds for the payment of the indebtedness assumed by the former district or otherwise necessary to comply with the terms and conditions of the consolidation agreement, all in addition to the general district taxes authorized elsewhere in Part 3 (commencing with Section 30000) of this division to be levied and collected.
The validity of any consolidating proceedings shall not be contested in any action unless the action is brought within three (3) months after the completion of the proceedings.
Upon the completion of such consolidation procedure, the Orange County Transit District shall be deemed to be dissolved. Thereafter, all property and assets of the district which are not subject to the negotiated contract pertaining to consolidation shall be distributed to the County of Orange.
PART 5. SAN JOAQUIN REGIONAL TRANSIT DISTRICT [50000. - 50507.]
CHAPTER 1. General Provisions [50000. - 50014.]
ARTICLE 1. Definitions [50000. - 50007.]
This part shall be known and cited as the “San Joaquin Regional Transit District Act.”
Unless the context otherwise requires, the provisions of this article govern the construction of this part.
“District” means the San Joaquin Regional Transit District formed under this part.
“Board” means the board of directors of this district.
“Voter” means any elector who is registered under the Elections Code.
“Transit” means the transportation of passengers and their incidental baggage by any means.
“Transit works” or “transit facilities” means all real and personal property, equipment, rights, or interests owned or to be acquired by the district for transit service.
For purposes of this part, “Stockton Metropolitan Area” means that area which was included within the boundaries of the Stockton Metropolitan Transit District, immediately prior to that district being expanded to include all of San Joaquin County.
ARTICLE 2. General Provisions [50010. - 50014.]
It is necessary that a transit district be established in the Stockton metropolitan area which includes the City of Stockton and adjacent territory situated in San Joaquin County in order to meet the transit problem of the area. The problem is unique in that presently there are several existing transportation facilities serving various parts of the area but independently operated, without interchange of transportation services, and without possibility of merger. The geographic location of the city to the area requiring transportation services makes it necessary to develop a single transit system to protect the public interest.
The San Joaquin Regional Transit District may be created as provided in this part and when so created may exercise the powers herein granted.
Except as otherwise provided in this part elections shall be held and conducted and the result ascertained, determined, and declared in, all respects as nearly as practicable in conformity with the general election laws of the State.
Except as otherwise provided in this part all ordinances and notices which are required to be published shall be published within the district pursuant to Section 6066 of the Government Code.
Whenever the signature of any officer or employee of a district or of any member of the retirement board or of any officer or employee of the retirement system is authorized or required under the provisions of this part, except in the single instance provided in Section 50243, the signature may be made by the use of a plate bearing facsimiles of such signatures.
CHAPTER 2. Formation of District [50020. - 50055.]
ARTICLE 1. General Provisions [50020. - 50021.]
The City of Stockton, together with unincorporated territory, may organize and incorporate as the Stockton Metropolitan Transit District.
The request for the formation of the Stockton Metropolitan Transit District may be made by resolution or by petition as set out in this chapter.
ARTICLE 2. Request by Resolution [50025. - 50027.]
The legislative body of the City of Stockton may pass a resolution declaring that in its opinion public interest or necessity demands the creation and maintenance of the Stockton Metropolitan Transit District.
The resolution may state the transit facilities proposed to be first acquired, but failure to acquire such transit facilities shall not affect the validity of the district. The resolution shall set forth and describe the boundaries of the proposed district.
Certified copies of the resolution shall be presented to the Board of Supervisors of San Joaquin County requesting the board of supervisors to call an election without delay for determining whether the district will be created.
ARTICLE 3. Request by Petition [50030. - 50033.]
Instead of a resolution, a petition may be presented to the board of supervisors signed by voters within the proposed district equal in number to at least 25 percent of the total vote cast at the last general election.
The petition shall contain substantially the same declarations and statements required to be contained in the resolution presented to the board of supervisors under this chapter, including the description of the boundaries, and declare that, in the opinion of the petitioners, public interest or necessity demands the creation and maintenance of the metropolitan transit district.
The petition may be on separate papers, but each paper shall contain the affidavit of the person who circulated it certifying that each name signed thereto is a true signature of the person whose name it purports to be.
The County Elections Official of the County of San Joaquin shall compare the signatures to the petition with the affidavits of registration and certify to their sufficiency or insufficiency.
ARTICLE 4. Election [50035. - 50045.]
Upon receipt of certified copies of the resolution or of a sufficient petition, the board of supervisors shall hold a hearing on the question of forming a Stockton Metropolitan Transit District. All interested persons shall be given an opportunity to express their views at the hearing.
The board of supervisors shall have the power to exclude unincorporated areas which, in the board’s determination, would not receive reasonable benefit from inclusion in the district.
At the conclusion of the hearing, if the board of supervisors approves the resolution or petition as originally presented or in modified form, it shall by resolution entered upon its minutes:
Fix and describe the exterior boundaries of the proposed district as determined by the board of supervisors.
Fix the date on which an election will be held in the proposed district and the hours during which the polls will be open.
State the purpose for which the election is held.
The election shall be held not less than 60 days nor more than 90 days from the date of the adoption of the resolution prescribed by Section 50037.
The election shall be called by publishing notice calling the election pursuant to Section 6066 of the Government Code not less than 20 days before the election. The notice need only specify the time and place of the election, the hours during which the polls will be open, the purpose of the election, and the description of the exterior boundaries of the proposed district as determined by the board of supervisors.
No notice of the election other than the notice prescribed by this section need be given except that the county elections official shall mail notice of the polling place and the purpose of the election to each qualified elector of the proposed district.
The ballot for the election shall contain such instructions as are required by law to be printed thereon and in addition thereto the following:
No person shall be entitled to vote at the election unless he is a voter of the territory included in the proposed district.
The election may be held on the same day as any other state, county, or city election, and be consolidated therewith.
The board of supervisors shall meet on the Tuesday next succeeding the day of the election and canvass the returns.
The board of supervisors shall make all provisions for the holding of the election throughout the entire district as proposed, and shall pay the cost thereof.
If a special election is held exclusively on the proposition of organizing the district, the expenditure therefor shall be reimbursed to the county by means of a tax on all the taxable property within the territory which was proposed to be included in the district, and this tax shall be added to the next county tax bills by the proper official of the county.
ARTICLE 5. Establishment of the District [50050. - 50050.]
If a majority of the electors voting on the proposition vote in favor of the creation and establishment of the district, the board of supervisors shall cause a certified copy of the order declaring the result of the election to be filed in the office of the Secretary of State, from and after which the establishment of the district shall be deemed complete.
ARTICLE 6. Contest of Incorporation [50055. - 50055.]
No informality in any proceeding or in the conduct of the election, not substantially affecting adversely the legal rights of any citizen, shall be held to invalidate the incorporation of the district. Any proceedings wherein the validity of incorporation is denied shall be commenced within three months from the date of filing the order declaring the result of the election with the Secretary of State, otherwise the incorporation and the legal existence of the district shall be held to be valid and in every respect legal and incontestable.
CHAPTER 3. Internal Organization of District [50060. - 50110.]
ARTICLE 1. Government [50060. - 50064.]
The government of the district shall be vested in a board of five directors. Two of the directors shall be appointed by the Board of Supervisors of the County of San Joaquin. Two of the directors shall be appointed by the City Council of the City of Stockton. The board of supervisors, together with five members of the city council appointed by the mayor, shall constitute a board of election which, by a majority vote, shall appoint the fifth director.
These appointments shall be made within 30 days after the formation of the district.
A vacancy on the board shall be filled by the body which appointed the director whose office is vacated and the new appointee shall hold his office for the unexpired term.
Each director shall, within 10 days after his appointment and before entering upon the discharge of his duties of his office, take and subscribe to an oath in the form set forth in Section 3 of Article XX of the Constitution of California before an officer authorized by law to administer oaths. The oaths shall be filed in the office of the district.
A person shall not be appointed to or be a member of the board unless he is a resident of the district and has resided within the district at least one year immediately prior to his appointment to the board.
ARTICLE 2. Terms of Office [50067. - 50067.]
The term of office of each director is four years from the time of his appointment, except that the chairman first appointed shall hold office for two years, and the remaining directors first appointed to the board shall classify themselves by lot, so that the two appointed by the board of supervisors shall hold office for one and three years and the two appointed by the city council shall hold office for two and four years.
ARTICLE 3. Powers and Duties of Directors [50070. - 50080.]
The board shall annually, in January, select one of its members as chairperson to serve at the pleasure of the board. The chairperson shall preside at all meetings of the board and shall vote on the propositions passed upon by the board.
The first meeting of the board shall be held within 10 days of the appointment of its chairman. The board may make its own rules of procedure and determine the place and time of its meeting.
The board shall select one of its members vice chairman, who shall preside in the absence of its chairman. The board shall provide for and select such officers as it deems necessary to conduct the affairs of the district.
All matters and things necessary for the proper administration of the affairs of the district which are not provided for in this part shall be provided for by the board.
The board shall supervise and regulate every transit facility owned and operated by the district, including the fixing of rates, rentals, charges and classifications, and the making and enforcement of rules, regulations, contracts, practices, and schedules, for or in connection with any transit facility owned or controlled by the district.
The board may either operate the transit system itself, or it may contract with the City of Stockton, or with any other public or private agency, to operate the transit system for the district.
All new intercity, interregional, and rural services provided outside the Stockton Metropolitan Area shall be subject to open competitive bidding at least once every five years. For the bidding, the district may be one of the bidders. The district shall cause notice inviting bids to be published at least once in a newspaper of general circulation within San Joaquin County, which publication shall be made at least 10 days before bids are to be received. The contract for service shall be let to the lowest responsible bidder. The board may reject any and all bids and may readvertise in its discretion.
The board may adopt a personnel system for the purpose of recruiting and maintaining an effective working force with good morale. The board shall by resolution determine and create such number and character of positions as are necessary properly to carry on the functions of the district and shall establish an appropriate salary, salary range, or wage for each position so created. The board may by resolution abolish any such position. Except as otherwise provided, appointments to such positions shall be made by the general manager.
The board may from time to time contract for or employ any professional service required by the district or for the performance of work or services which cannot satisfactorily be performed by the regular employees of the district.
The board shall have an annual audit made of all books and accounts of the district by a certified public accountant or public accountant.
The board may provide by resolution, under such terms and conditions as it sees fit, for the payment of demands against the district without prior specific approval thereof by the board if the demand is for a purpose for which an expenditure has been previously approved by the board and in an amount no greater than the amount so authorized, and if the demand is approved by the general manager.
To facilitate the business of the district, the board may provide for the creation and administration of such funds as the needs of the district may require. The funds shall be disbursed in accordance with rules established by the board and all payments from any fund shall be reported to the board.
ARTICLE 4. Meetings and Legislation [50085. - 50090.]
All meetings of the board shall be conducted in a manner prescribed by the Ralph M. Brown Act, Chapter 9 (commencing with Section 54950), Part 1, Division 2, Title 5 of the Government Code.
A majority of the board constitutes a quorum for the transaction of business.
The board shall adopt rules for its proceedings and may provide, by ordinance or resolution, that each member shall receive for each attendance at the meetings of the board and committees the sum of one hundred dollars ($100), but not to exceed five hundred dollars ($500) in a calendar month, and shall be allowed such necessary traveling and personal expenses incurred in the performance of duties authorized by the board.
The acts of the board shall be expressed by motion, resolution, or ordinance. No ordinance shall be passed by the board on the day of its introduction, nor within three days thereafter, nor at any time other than a regular or adjourned regular meeting. No ordinance, resolution, or motion shall have any validity or effect unless passed by the affirmative votes of a majority of the directors.
All ordinances shall be published after passage.
The enacting clause of all ordinances shall be as follows:
“Be it enacted by the board of directors of San Joaquin Regional Transit District:” All ordinances shall be signed by the chairperson of the board or the vice chairperson and attested by the secretary.
ARTICLE 5. Other Officers [50095. - 50110.]
The board shall appoint and fix the salary of a general manager, who shall have full charge of the acquisition, construction, maintenance, and operation of the facilities of the district, and also of the administration of the business affairs of the district.
All other things being equal, the board shall appoint as general manager, a person who has had experience in the construction or management of transit facilities.
The general manager need not be a resident of this State at the time of his appointment.
The general manager may be removed by the board upon the adoption of a resolution by the affirmative vote of not less than a majority of the board. Before the general manager may be removed, he shall, if he demands it, be given a written statement of the reasons alleged for his removal and he shall have the right to be publicly heard thereon at a meeting of the board prior to the final vote on the resolution providing for his removal, but pending and during such hearing the board may suspend him from office. The board may not reduce the salary of the general manager below the amount fixed at the time of his original appointment except upon the adoption of a resolution by a like vote and after a like opportunity to be heard. The action of the board in suspending or removing the general manager or reducing his salary, if approved by a majority of the membership of the board, is final.
Notwithstanding anything to the contrary in Section 50098, until such time as the district has operated, controlled, or used facilities or parts of facilities for providing the inhabitants within the boundaries of the district with transit services for a period of six months, the board may, but is not required to, appoint a general manager. A general manager appointed during such time holds office at the pleasure of the majority of the board.
The board shall appoint a secretary and an attorney, who shall hold office during the pleasure of the board.
The attorney shall be admitted to practice law in the Supreme Court of the State, and shall have been actively engaged in the practice of his profession for not less than three years next preceding his appointment.
The board may consolidate any of the district offices in one person.
The oath of all appointive officers of the district shall be taken, subscribed, and filed with the secretary of the district at any time after the officer has notice of his appointment but not later than 15 days after the commencement of his term of office. No other filing is required.
Each appointive officer shall give such bond and in such amount as the board may require.
Subject to the control of the board, the powers and duties of the general manager are:
To have full charge of the acquisition, construction, maintenance, and operation of the facilities of the district.
To have full charge of the administration of the business affairs of the district.
To see that all ordinances of the district are enforced.
To administer the personnel system adopted by the board and except for officers appointed by the board to appoint, discipline or remove all officers and employees subject to the rules and regulations adopted by the board.
To attend all meetings of the board and submit a general report of the affairs of the district.
To keep the board advised as to the needs of the district.
To prepare or cause to be prepared all plans and specifications for the construction of the works of the district.
To devote his entire time to the business of the district.
To perform such other and additional duties as the board may require.
The general manager shall within 90 days from the end of each fiscal year cause to be published a financial report showing the result of operations for the preceding fiscal year and the financial status of the district on the last day thereof. The publication shall be made in the manner provided in this part for the publication of ordinances and notices generally.
The attorney shall take charge of all suits and other legal matters to which the district is a party or in which it is legally interested. He shall give his advice or opinion in writing whenever required by the board. He shall be the legal adviser of the general manager and other district officers and shall prepare or approve the forms of all ordinances, resolutions, contracts, bonds, and other legal documents connected with the business of the district. He shall perform such other and additional services as the board may require.
The general manager shall cause to be installed and maintained a system of auditing and accounting which shall completely and at all times show the financial condition of the district. All warrants for the payment of demands against the district shall be paid in accordance with such rules as the board may establish.
The general manager shall provide for the custody of the funds of the district and the keeping of accounts of all receipts and disbursements. Payments shall be made only upon warrants duly and regularly signed by the chairman or vice chairman of the board, or other person authorized by the board so to do, and by the general manager or secretary.
With the consent of the board, the general manager may:
Authorize the trust department of any state or national bank in this State, or a trust company authorized to act as such in this State, to receive as his agent deposits of any securities acquired by the district.
Place and maintain for safekeeping as a trust deposit with the trust department of any state or national banks in this State, or a trust company authorized to act as such in this State, any securities owned by the district.
The bank or trust company selected shall have a total paid-in capital of at least one million dollars ($1,000,000). The general manager shall take from the trust department or trust company a receipt for the securities, and neither the general manager nor the district is responsible for the custody and safe return of the securities until they are withdrawn from the trust department or trust company by the general manager. Any trust department or trust company to which securities are delivered, either as agent or depository for the general manager, shall make such disposition of the securities as the general manager directs and is responsible only for strict compliance with written instructions given to it by the general manager. All such securities are at all times subject to the order of the general manager.
CHAPTER 4. Labor Provisions [50120. - 50126.]
If a majority of the employees employed by a transit district in a unit appropriate for collective bargaining indicate a desire to be represented by a labor organization, then the board, after determining pursuant to Section 50121 that the labor organization represents the employees in the appropriate unit, shall bargain with the accredited representative of those employees. Both parties shall bargain in good faith and make all reasonable efforts to reach agreement on the terms of a written contract governing wages, salaries, hours, working conditions, and grievance procedures.
If a dispute arises over the terms of a written contract governing wages, salaries, hours, or working conditions that is not resolved by negotiations conducted in good faith between the board and the representatives of the employees, then the board and the representatives of the employees shall submit the dispute to an arbitration board. The decision of a majority of the arbitration board shall be final.
The arbitration board shall be composed of two representatives of the transit board, two representatives of the labor organization, and a fifth member to be agreed upon by the representatives of the transit board and labor organization.
If the representatives of the transit board and labor organization are unable to agree on the fifth member, then the names of five persons experienced in labor arbitration shall be obtained from the California State Mediation and Conciliation Service. The labor organization and the district shall, alternately, strike a name from the list supplied by the California State Mediation and Conciliation Service. The labor organization and the district shall determine by lot who shall first strike a name from the list. After the labor organization and the transit district have stricken four names, the name remaining shall be designated as the arbitrator.
The transit board and the labor organization shall each pay one-half of the cost of the impartial arbitrator.
A contract or agreement shall not be made with any labor organization, association, group, or individual that denies membership on any basis listed in subdivision (a) of Section 12940 of the Government Code, as those bases are defined in Sections 12926 and 12926.1 of the Government Code. However, the organization may preclude from membership any individual who advocates the overthrow of the government by force or violence.
The district shall not discriminate with regard to employment against any person on any basis listed in subdivision (a) of Section 12940 of the Government Code, as those bases are defined in Sections 12926 and 12926.1 of the Government Code, except as otherwise provided in Section 12940 of the Government Code.
If there is a question whether a labor organization represents a majority of employees or whether the proposed unit is or is not appropriate, such matters shall be submitted to the State Conciliation Service for disposition. The State Conciliation Service shall promptly hold a public hearing and may, by decision, establish the boundaries of any collective bargaining unit and provide for an election to determine the question of representation. Provided, however, any certification of a labor organization to represent or act for the employees in any collective bargaining unit shall not be subject to challenge on the ground that a new substantial question of representation within such collective bargaining unit exists until the lapse of one year from the date of certification or the expiration of any collective bargaining agreement, whichever is later.
Whenever any district acquires existing facilities from a publicly or privately owned public utility either in proceedings by eminent domain or otherwise, to the extent necessary for operation of facilities, all of the employees of such public utility whose duties pertain to the facilities acquired who have been employed by said utility for at least seventy-five (75) days shall be appointed to comparable positions in the district without examination and shall be governed thereafter by the personnel system adopted by the board, and these employees shall be given sick leave, seniority and vacation credits in accordance with the records of the acquired public utility.
The provisions of this section shall apply only to those officers or supervisory employees of the acquired utility as shall be designated by the board.
Whenever any district acquires existing facilities from a publicly or privately owned public utility, either in proceedings in eminent domain or otherwise, that has a pension plan in operation, members and beneficiaries of such pension plan shall continue to have the rights, privileges, benefits, obligations and status with respect to such established system.
Whenever any such facilities are acquired by the district, the board shall consider and take into account the outstanding obligations and liabilities of the publicly or privately owned public utility by reason of such pension plan and shall negotiate an allowance in the purchase price of such utility for the assumption of such obligations and liabilities when acquiring the facilities.
The persons entitled to pension benefits as provided for in Section 50123 and the benefits which are provided shall be specified in the agreement or order by which any public utility is acquired by the district.
All persons receiving pension benefits from such acquired public utility and all persons entitled to pension benefits under the pension plan of such acquired public utility may become members or receive pensions under the retirement system established by the district by mutual agreement of such persons and the district.
Notwithstanding any provisions of the Government Code, the board may authorize payment of any or all of the premiums on any group life, accident and health insurance, health and welfare plan, or pension or retirement plan, on officers or employees of a district. Upon authorization by its employees, a district may make deductions from the wages and salaries of its employees:
Pursuant to a collective bargaining agreement with a duly designated or certified labor organization for the payment of union dues, fees, or assessments.
For the payment of contributions pursuant to any health and welfare, pension, or retirement plan.
For any purpose for which deductions may be authorized by employees of any private employer.
CHAPTER 5. Retirement System [50130. - 50156.]
ARTICLE 1. Establishment [50130. - 50135.]
The board may establish a retirement system for the officers and employees of the district and provide for the payment of annuities, pensions, retirement allowances, disability payments, and death benefits or any of them.
The district may maintain its own retirement fund or may provide for benefits to eligible officers and employees, or their beneficiaries, by means of group insurance, or other insurance, or by such means as in the opinion of the board will satisfactorily provide an adequate and sure method of meeting the payments contemplated by the retirement system.
Before establishing any retirement system the board shall secure a report from a qualified actuary, which shall show the cost of the benefits provided by the system, and the prospective assets and liabilities of the system.
The board may adopt all ordinances and resolutions and perform all acts necessary or convenient to the initiation, maintenance, and administration of the retirement system.
Nothing in this chapter prevents a district from participating in and making all or part of its employees members of the State Employees’ Retirement System by contract entered into between the district and the board of administration of the system under the State Employees’ Retirement Law or from participating in the Federal Social Security Act pursuant to Part 4 (commencing with Section 22000), Division 5, Title 2 of the Government Code, and the district may perform all acts necessary or convenient for such participation.
The board may classify and determine the officers and employees who shall be included as members in the retirement system and may change the classification from time to time. Membership of all officers and employees so classified and included in the retirement system is compulsory. The retirement system shall not apply to members of the board.
ARTICLE 2. Benefits and Contributions [50140. - 50146.]
The board may prescribe the terms and conditions upon which the officers and employees of the district or their beneficiaries shall be entitled to benefits and the amounts thereof.
The retirement allowance may be predicated in part upon service rendered the district by a member prior to the establishment of the retirement system, which service is known as “prior service.”
The board shall provide that both the district and the members shall contribute to the retirement system. The rate of contribution by an officer or employee of the district becoming a member of the retirement system shall be so fixed as to provide, with accumulated interest and based on tables and assumptions adopted by the board, substantially one-half the value of any retirement allowance granted for service, exclusive of any credits allowed for prior service.
All members of the retirement system shall contribute in the manner and amount fixed by the board and such contributions may be collected by deducting the amounts thereof from the salary, wages, or compensation due such members.
Liabilities accruing under the retirement system because of benefits other than such as are the equivalent of contributions by the members, with accumulated interests, shall be met by contributions by the district. Prior service or other liabilities of the district may be met by annual appropriations instead of by one appropriation for the total of the liabilities; but until the present value of regular contributions for current service, together with assets then available, equals the present value of all allowances and benefits granted or to be granted under the system, the appropriation for any one year when added to any unused balance of any previous appropriations for such purpose shall not be less than the amount disbursed during that year on account of prior service or other liabilities of the district.
If any member withdraws from the retirement system prior to retirement the total amount contributed by him with such interest as may be credited thereto shall be returned to him; provided, however, that the board may prescribe the terms and conditions upon which a member, whose district service is terminated except by death or retirement, may elect to leave his contributions and interest thereon in the retirement fund, and the terms and conditions upon which a retirement allowance may be made to him after such termination based upon his contributions prior to such termination.
All money received by any person as an annuity, pension, retirement allowance, disability payment, or death benefit from the retirement system, and all contributions and interest thereon returned to any member of the retirement system, whether in the actual possession of such person or deposited, loaned, or invested by him, is exempt from execution or any other process except to the extent permitted by Section 704.110 of the Code of Civil Procedure and is unassignable.
ARTICLE 3. Retirement Board [50150. - 50153.]
The board shall create a retirement board of not more than five members, at least two members of which shall be the elected representatives of the employees, to administer the retirement system, and shall define its powers and duties and the tenure of the members.
All members of the retirement board shall serve without pay.
The retirement board shall determine the eligibility of officers, employees, and their dependents to participation in the system and shall be the sole authority and judge under such ordinances as may be adopted by the board as to the conditions under which persons may be admitted to and continue to receive benefits of any sort under the retirement system, and may modify allowances for service and disability. The determination of the retirement board shall be final and conclusive and shall not be modified or set aside except for fraud or abuse of discretion.
If the district maintains its own retirement fund the retirement board shall have exclusive control of the administration, investment, and disbursement of such fund. Investment of the fund shall be subject to the terms, conditions, limitations, and restrictions imposed by the laws of this State upon savings banks in the making of investments by savings banks, and cash may be deposited in any licensed national bank or banks in this State or in any bank, banks, or corporations authorized or licensed to do a banking business and organized under the laws of this State.
ARTICLE 4. Investigation and Penalties [50155. - 50156.]
At least once in each four-year period after the establishment of the retirement system the board shall cause to be made an actuarial valuation of the assets and liabilities of the retirement fund, and upon the basis of such investigation and valuation shall make such revision or change of the rates of contribution, the periods and conditions of service, and amounts of retirement allowances as may be necessary.
Except as herein provided, no member of the board or of the retirement board, nor any member of the retirement system or employee of the district, shall have any interest direct or indirect in the making of any investment or in the gains or profits accruing therefrom, and no such person, directly or indirectly, for himself or as an agent or partner of others, shall borrow any of its funds, nor shall any such person in any manner use the same except to make such current and necessary payments as are authorized by the retirement board, nor shall such a person become an endorser or surety as to, or in any manner an obligor for investments of the retirement fund.
CHAPTER 6. Powers and Functions of District [50160. - 50220.]
ARTICLE 1. Corporate Power [50160. - 50162.]
The district has perpetual succession and may adopt a seal and alter it at pleasure.
The district may sue and be sued, except as otherwise provided by law, in all actions and proceedings, in all courts and tribunals of competent jurisdiction.
The district may exercise the right of eminent domain to take any property necessary or convenient to the exercise of the powers granted in this part. The district, in exercising such power shall, in addition to the damage for the taking, injury, or destruction of property, also pay the cost of removal, reconstruction, or relocation of any structure, railways, mains, pipes, conduits, cables, or poles of any public utility or public district which is required to be moved to a new location.
No action in eminent domain to acquire property within any incorporated city or any county shall be commenced unless the legislative body of the affected city or county has consented to such acquisition by resolution.
ARTICLE 2. Contracts [50165. - 50166.]
The district may make contracts and enter into stipulations of any nature whatsoever, either in connection with eminent domain proceedings or otherwise, including, without limiting the generality of the foregoing, contracts and stipulations to indemnify and save harmless, to employ labor, and to do all acts necessary and convenient for the full exercise of the powers granted in this part.
No officer or employee of the district shall in any manner be interested, directly or indirectly, in any contract awarded or to be awarded by the board, or in the profits to be derived therefrom contrary to the provisions of Article 4 (commencing with Section 1090), Chapter 1, Division 4, Title 1 of the Government Code.
ARTICLE 4. Property [50175. - 50176.]
The district may take by grant, purchase, gift, devise or lease, or condemn in proceedings under eminent domain, or otherwise acquire, and hold and enjoy, real and personal property of every kind within or without the district necessary to the full or convenient exercise of its powers. The board may lease, mortgage, sell, or otherwise dispose of any real or personal property within or without the district when in its judgment it is for the best interests of the district so to do.
Whenever the board by resolution determines that any record, map, book, or paper in the possession of the district or any officer or employee thereof is of no further value to the district, the board may authorize its sale, destruction, or other disposition.
ARTICLE 5. Transit Facilities and Service [50180. - 50190.]
The district may acquire, construct, own, operate, control or use rights-of-way, rail lines, buslines, stations, platforms, switches, yards, terminals, and any and all other facilities necessary or convenient for transit service within or partly without the district, underground, upon, or above the ground and under, upon, or over public streets or other public ways or waterways, together with all physical structures necessary or convenient for the access of persons and vehicles thereto, and may acquire any interest in or rights to the joint use of any or all of the foregoing; provided, that installations in any street, road or other property devoted to a public use shall be subject to consent of the governing body in charge of such public use.
The district may without limitation by any other provisions of this part requiring approval of indebtedness, accept contributions of money, rights-of-way, labor, materials, and any other property for the acquisition, construction, maintenance, and operation of transit facilities, and may without limitation by any other provisions of this part enter into any contracts and co-operation with and accept co-operation from the State, or any department, instrumentality, or agency thereof, or any public agency in the acquisition, construction, maintenance, and operation of, and in financing the acquisition, construction, maintenance, and operation of, any such transit facilities.
The district shall not interfere with or exercise any control over any transit facilities now or hereafter owned, and operated wholly or partly within the district by any city or public agency, unless by consent of such city or public agency and upon such terms as are mutually agreed upon between the board and such city or public agency.
The district may lease or contract for the use of its transit facilities, or any portion thereof, to any operator, and may provide for subleases by such operator upon such terms and conditions as it deems in the public interest. The word “operator” as used in this section means any city or public agency or any person, firm or private corporation.
The district may construct and operate or acquire and operate works and facilities in, under, upon, over, across, or along any street or public highway or any stream, bay or watercourse, or over any of the lands which are the property of the State, to the same extent that such rights and privileges appertaining thereto are granted to municipalities within the State, and to install adequate bus stops, including the painting of curbs, subject to the consent of the governing body in charge of such streets, highways, stream, watercourse or lands.
The district may enter into agreements for the joint use of any property and rights by the district and any city, public agency or public utility operating transit facilities; may enter into agreements with any city, public agency or public utility operating any transit facilities, either wholly or partially within, or without, the district, for the joint use of any property of the district or of such city, public agency or public utility, or the establishment of through routes, joint fares, transfer of passengers or pooling arrangements.
The rates and charges for service furnished pursuant to this part shall be fixed by the board and shall be reasonable.
The board of supervisors or the city council of a municipality having territory located within the district may file a request for a hearing before the district board as to the reasonableness of any rates or charges fixed by the district and as to any proposal for fixing the location of facilities by the district. The request shall be in writing and shall state the subject matter on which a hearing is desired.
Upon the filing of a request for hearing as provided in Section 50187 the district board shall fix the time and place for hearing. The time fixed shall not be less than 15 days nor more than 60 days from the date such request is filed. Notice of such hearing shall be given to the county or city requesting such hearing and shall be published by the board.
At the time fixed for any hearing before the board any board of supervisors or city council eligible to file a request for hearing, not a party to the original request for hearing, may intervene and shall be entitled to be heard and to introduce evidence.
Within 30 days after submission of the case, the board shall render its decision and its decision shall be final.
ARTICLE 6. Indebtedness [50200. - 50203.]
The district may borrow money for the purpose of defraying the expenses of the district lawfully incurred after the commencement of the fiscal year, but prior to the time moneys from the tax levy for the fiscal year are received by the district, in a sum which shall not exceed five cents ($0.05) on each one hundred dollars ($100) of assessed valuation of taxable property in the district at the time the moneys are borrowed, and may evidence such borrowing by notes bearing interest at a rate not to exceed 6 percent per annum. The notes shall be payable from the tax levy from the then current fiscal year, which levy shall contain a sum sufficient to provide for the payment of the notes and the interest thereon. The form of said notes and the proceedings relating to their issuance and sale, will be governed by the applicable provisions contained in Article 7 (commencing with Section 53820) of Chapter 4 of Part 1 of Division 2 of Title 5 of the Government Code.
The board of directors of a district may, within a period of two years from and after the formation of the district, pursuant to a resolution adopted by it for the purpose, borrow money on certificates of indebtedness, promissory notes, or other evidences of indebtedness, in anticipation of the estimated tax revenue for the following fiscal year, to be repaid within four years from the date of borrowing with interest at a rate not to exceed 6 percent per annum, in order to enable the district to meet all of its necessary initial expenses of organization, construction, acquisition, maintenance, and operation. The total amount of money borrowed and indebtedness incurred under this section during this two-year period shall not exceed 50 percent of the total amount of estimated tax revenue as estimated by the county auditor of the county in which the district lies for the following fiscal year.
The form of said notes and the proceedings relating to their issuance and sale, will be governed by the applicable provisions contained in Article 7 (commencing with Section 53820) of Chapter 4 of Part 1 of Division 2 of Title 5 of the Government Code.
The district shall not incur an indebtedness under Chapter 7 (commencing with Section 50225) of this part which in the aggregate exceeds two (2) percent of the assessed value of all the real and personal property within the district.
The district may accept, without limitation by any other provisions of this part requiring approval of indebtedness, contributions or loans from the United States, this State, or any department, instrumentality, or agency of either thereof, for the purpose of financing the acquisition, construction, maintenance, and operation of transit facilities, and may enter into contracts and co-operate with, and accept co-operation from, the United States, this State, or any department, instrumentality, or agency of either thereof, in the acquisition, construction, maintenance, and operation, and in financing the acquisition, construction, maintenance, and operation of any such transit facilities in accordance with any legislation which Congress or the Legislature of the State of California may have heretofore adopted or may hereafter adopt, under which aid, assistance, and co-operation may be furnished by the United States or this State in the acquisition, construction, maintenance, and operation or in financing the acquisition, construction, maintenance and operation of any such transit facilities. The district may do any and all things necessary in order to avail itself of such aid, assistance, and co-operation under any federal or state legislation now or hereafter enacted. Any evidence of indebtedness issued under this section shall constitute a negotiable instrument.
ARTICLE 7. Investments [50205. - 50208.]
The district may invest surplus money in its treasury, including money in a sinking fund, in any of the following investments:
Its own bonds, notes, or obligations.
In any investment or deposit that a local agency may place funds pursuant to the laws of the state.
The San Joaquin County Treasury Investment Pool.
If the district invests surplus money pursuant to paragraph (2) of subdivision (a), those investments shall be in accordance with Article 1 (commencing with Section 53600) and Article 2 (commencing with Section 53630) of Chapter 4 of Part 1 of Division 2 of Title 5 of the Government Code.
The investment of surplus money may be made by direct purchase of investments at the original sale or by the subsequent investments in the secondary market.
Any investments purchased and held by the district may from time to time be sold and the proceeds reinvested in investments as provided in this article.
Sales of any investments purchased and held by the district shall from time to time be made in season so that the proceeds may be applied to the purposes for which the money with which the investments were originally purchased was placed in the treasury of the district.
ARTICLE 8. Taxation [50210. - 50220.]
The district may levy, and collect or cause to be collected, taxes for any lawful purpose subject to a maximum limit of five cents ($0.05) per one hundred dollars ($100) of assessed value of all real estate and personal property; provided however, the district shall have the further power to levy, collect or cause to be collected, said property taxes to a maximum limit of ten cents ($0.10) if approval is first obtained from the City Council of the City of Stockton and the Board of Supervisors of the County of San Joaquin.
The district may only levy and collect taxes pursuant to this article within the Stockton Metropolitan Area, as defined in Section 50007.
If, in the opinion of the board, the transit operation revenues will not be sufficient for any and all lawful purposes the board shall levy a tax for such purpose or purposes and fix the amount of money necessary to be raised therefor by taxation.
The board shall, in addition to the general tax levy as set forth in Section 50210, levy and collect annually until the district’s bonds are paid, or until there is a sum in the treasury of the district set apart for that purpose to meet all sums coming due for principal and interest on the bonds as they become due a tax sufficient to pay the annual interest on the bonds and such part of the principal thereof as becomes due before the proceeds of a tax levied at the next general tax levy will be available. If the maturity of the indebtedness created by the issue of bonds begins more than one year after the date of the issuance thereof, the tax shall be levied and collected annually at the time and in the manner aforesaid, sufficient to pay the interest on the indebtedness as it falls due and to constitute a sinking fund for the payment of the principal on or before maturity.
The board may provide for the assessment, levy, and collection of taxes by the district, including the sale of property to the district for delinquent taxes, with penalties, interest, and cost.
The board shall avail itself of the assessments made by the assessor of the county and of the assessments made by the State Board of Equalization for the county and shall take such assessments as the basis for district taxation and have its taxes collected by the tax collector of the county.
In such case the county auditor shall, on or before the third Monday in August of each year, transmit to the board a statement in writing showing the total value of all property within the district, ascertained from the assessments referred to in Section 50214 as equalized.
The board shall, on or before the first weekday in September, or if such weekday falls upon a holiday then on the first business day thereafter, fix the rate of taxes, designating the number of cents upon each hundred dollars, using as a basis the value of property transmitted to the board by the county auditors, which rate of taxation shall be sufficient to raise the amount previously fixed by the board. These acts by the board shall constitute a valid assessment of the property and a valid levy of the taxes so fixed, but the rate of taxation shall not exceed the limit imposed by this article.
The board shall immediately after fixing the rate of taxes as above provided transmit to the county auditor of the county a statement of the rate of taxes fixed by the board.
The district’s taxes so levied shall be collected at the same time and in the same manner as county taxes. When collected the net amount, ascertained as provided in this article, shall be paid to the treasurer of the district, under the general requirements and penalties provided by law for the settlement of other taxes.
Whenever any real property has been sold for taxes and has been redeemed, the money paid for redemption shall be apportioned and paid to the district by the county treasurer in the proportion which the tax due to the district bears to the total tax for which the property was sold.
The compensation to be charged by and paid to any county for the performance of services under this article shall be fixed by agreement between the board of supervisors of the county and the board. The compensation shall in no event exceed one-half of 1 percent of all money collected for the district. The compensation collected by the county shall be placed to the credit of the county general fund.
All taxes levied under this part are a lien on the property on which they are levied and shall become a lien at the same time as county taxes. The enforcement of the collection of such taxes shall be in the same manner and by the same means provided by law for the enforcement of liens for county taxes, all the provisions of law relating to the enforcement of the latter being made a part of this part so far as applicable.
CHAPTER 7. Bonds [50225. - 50266.]
ARTICLE 1. Issuance [50225. - 50237.]
The district may from time to time incur a bonded indebtedness as provided in this chapter to pay the cost of acquiring, constructing, or completing the whole or any portion of any transit facilities, or for acquiring any works, lands, structures, rights, equipment, or other property necessary or convenient to carry out the objects, purposes, or powers of the district.
Whenever the board by resolution passed by vote of two-thirds of all its members determines that the public interest or necessity demands the acquisition, construction, or completion by the district of any transit facilities or any works, lands, structures, rights, equipment, or other property necessary or convenient to carry out the objects, purposes, or powers of the district, the cost of which will be too great to be paid out of the ordinary annual income and revenue of the district, it may at any subsequent meeting of the board provide by ordinance for the submission of the proposition of incurring a bonded indebtedness for the purpose set forth in the resolution to the voters of the district at a special bond election held for that purpose.
In lieu of a resolution passed by the board, proceedings for the issuance of bonds for the purposes provided in this chapter may be initiated by petition of the voters of the district.
Whenever any petition signed by voters within the district equal in number to at least 15 percent of the total vote cast at the last general statewide election is presented to the board asking for the acquisition, construction, or completion of the whole or any portion of any transit facilities or for acquiring any works, lands, structures, rights, equipment, or other property necessary or convenient to carry out the objects, purposes, or powers of the district, and also asking that a bonded indebtedness be incurred to pay for the cost thereof, the secretary of the district shall immediately examine and verify the signatures of the petition and certify the result of the examination to the board.
If the required number of signatures is found to be genuine, the secretary shall transmit to the board an authentic copy of the petition without the signatures.
Upon receiving a petition with the certificate of the secretary stating that it contains the required number of signatures, the board shall formulate for submission to the voters of the district at a special bond election called for that purpose the proposition of incurring a bonded indebtedness for the purposes set forth in the petition. In its discretion the board may defer the calling of the election until the next general election to be held in the district in order to consolidate them.
The ordinance calling a special bond election shall fix the date on which the election will be held, and the manner of holding the election and of voting for or against incurring the indebtedness. It shall also recite the objects and purposes for which the indebtedness is proposed to be incurred, the estimated cost of the transit facilities, works, lands, structures, rights, equipment, or other property proposed to be acquired, constructed, or completed, the amount of the principal of the indebtedness to be incurred therefor, and the maximum rate of interest to be paid on the indebtedness, which shall not exceed 6 percent per annum, payable semiannually or annually the first year and thereafter semiannually.
Propositions for incurring indebtedness for more than one object or purpose may be submitted at the same election.
Any special bond election may be held separately, or may be consolidated with any other election authorized by law at which the voters of the district may vote. If a special bond election is consolidated with any other election, the provisions of this chapter setting forth the procedure for the calling and holding of the special bond election shall be complied with, except that the ordinance calling the election need not set forth the election precincts, polling places, and officers of election, but may provide that the precincts, polling places, and officers of election shall be the same as those set forth in the ordinance, notice, or other proceedings calling the election with which the special bond election is consolidated, and shall refer to the ordinance, notice, or other proceedings by number and title, or by other definite description.
The ordinance shall be published, and no other notice of election need be given.
The board shall comply with the provisions of Article 3 (commencing with Section 9160) of Chapter 2 of Division 9 of the Elections Code, the provisions of which are applicable to any bond election held pursuant to this article. Wherever the words “county clerk” or “county elections official” appear in the Elections Code the words “secretary of the board” shall be substituted, for the purposes of this article, and wherever the words “board of supervisors” appear in the Elections Code, the words “board of directors” shall be substituted, and wherever the words “district attorney or county counsel” appear in the Elections Code, the words, “attorney for the district” shall be substituted.
The votes of a majority of all the voters voting on the proposition at the election are required to authorize the issuance of bonds under this chapter.
If the proposition submitted at a special bond election fails to receive the requisite number of votes, the board shall not within six months after the election hold another special election for the submission of a proposition of incurring a bonded indebtedness substantially the same as the proposition voted upon at the prior election unless a petition signed by voters within the district equal in number to at least 15 percent of the total vote cast at the last general statewide election is filed with the board, requesting that the proposition, or a proposition substantially the same, be submitted at an election to be called for that purpose.
ARTICLE 2. Form and Content [50240. - 50243.]
Bonds authorized by this chapter shall mature serially in amounts to be fixed by the board; except that payment shall begin not later than 10 years from the date thereof and shall be completed in not more than 50 years from that date.
The board may divide any issue of bonds authorized pursuant to this chapter into two or more series, and may fix different dates of issuance and different maturity dates for the bonds of each series. The bonds of each series shall mature serially in amounts to be fixed by the board, and the board shall fix a date not more than 10 years from the date of issuance of each series for the earliest maturity of such series, and shall fix a date not more than 50 years from the date of issuance of each series for the final maturity of such series.
Pending the actual issuance or delivery of bonds, a district may issue temporary or interim bonds, certificates, or receipts, of any denomination whatsoever, with or without coupon, and in such form as may be prescribed by the board, to be exchanged for definite bonds when ready for delivery.
The bonds shall be issued in such denominations as the board determines, except that no bonds shall be of a denomination less than one hundred dollars ($100), nor of a greater denomination than one thousand dollars ($1,000) or any multiple thereof, and shall be payable on the day and at the place or places fixed in the bonds, and with interest at the rate specified therein, payable semiannually.
The board may at any time prior to the issuance and sale of any bonds provide for the call and redemption of any or all of the bonds on any interest payment date prior to their fixed maturity at not exceeding the par value and accrued interest plus a premium of not exceeding 5 percent upon the principal amount of the bonds, in which event the call price fixed by the board shall be set forth on the face of the bond. Notice of such redemption shall be published. If there is no newspaper of general circulation printed and published within the district, then the publication shall be made in a newspaper of general circulation printed and published within the county in which the district or any part thereof is situated. The first publication shall be at least 30 days prior to the date fixed for the redemption. After the date fixed for such redemption interest on the bonds thereafter shall cease.
The bonds shall be signed by the president of the board or by such officer of the district as the board shall by resolution authorize and designate for that purpose. They shall also be signed by the treasurer, and be countersigned by the secretary. The coupons of the bonds shall be numbered consecutively and be signed by the treasurer. All signatures and countersignatures, except one of the signatures or countersignatures on the bonds, may be printed, lithographed, or engraved. If any officer whose signature or countersignature appears on the bonds or coupons ceases to be such officer before the delivery of the bonds to the purchaser, the signature or countersignature is nevertheless valid and sufficient for all purposes as if he had remained in office until the delivery of the bonds.
ARTICLE 3. Issue and Sale [50245. - 50247.]
The bonds may be issued and sold for not less than their par value, but otherwise as the board determines. Before selling any bonds, or any part thereof, the board shall give notice inviting sealed bids in such manner as the board may prescribe. If satisfactory bids are received, the bonds offered for sale shall be awarded to the highest responsible bidder. If no bids are received, or if the board determines that the bids received are not satisfactory as to price or responsibility of the bidders, the board may reject all bids received, if any, and either again give notice inviting bids or sell the bonds at private sale.
All premiums and accrued interest received on the sale of bonds shall be placed in the fund to be used for the payment of principal of and interest on the bonds. The remainder of the proceeds of the bonds shall be placed in the district treasury to the credit of the proper fund, and shall be used exclusively for the objects or purposes for which the bonds were voted; provided that when such objects and purposes have been accomplished any moneys remaining shall be transferred to the fund to be used for the payment of principal of and interest on the bonds, and that when all principal of and interest on the bonds shall have been paid, any balance of money then remaining shall be transferred to the general fund of the district.
In lieu of the immediate levy of a tax to pay the interest or any part thereof on any bonded indebtedness incurred in accordance with this division, the board may in the estimate of the amount of money necessary to be raised by the bonds include a sum sufficient to pay interest on all of the bonds or part thereof during the period of acquisition, construction, or completion, but for no period in excess of five years.
ARTICLE 4. Refunding [50250. - 50256.]
Whenever the board by resolution passed by a vote of two-thirds of all its members determines that the refunding of the whole or any portion of the bonded indebtedness will be of advantage to the district the board may refund the bonded indebtedness or any portion thereof and issue refunding bonds of the district therefor.
The issuance of refunding bonds shall not be construed as the incurring or increase of an indebtedness within the meaning of this act, and the approval of the voters is not required for the issuance of refunding bonds. The board may provide for the call and redemption of any or all of the bonds on any interest payment date prior to their fixed maturity in the ordinance authorizing the issuance of the refunding bonds.
Except as otherwise provided, the provisions of this chapter shall substantially govern as to all matters pertaining to the issuance of refunding bonds, including and without limiting the generality of the foregoing, the form, execution, issuance, maturity, redemption, refunding, validation, the payment of interest from bond funds, and the status of the bonds as investments.
Refunding bonds shall bear interest at a rate not exceeding the interest rate on the refunded bonds, but payment of the refunding bonds shall begin not later than one year from the date thereof and be completed in not more than 40 years from that date.
The proceeds of the sale of refunding bonds shall be applied only to the purchase, or retirement at not more than par and accrued interest, or the call price, of the bonded indebtedness for which the refunding bonds were issued.
In lieu of selling refunding bonds and using the proceeds to purchase or retire the bonds to be refunded, the board may exchange refunding bonds at not less than par and accrued interest for the bonds so refunded.
Whenever outstanding bonds are refunded they shall be surrendered to the treasurer of the district, who shall cancel them by endorsing on their face the manner in which the refunding was effected (whether by exchange or purchase, and the amount for which so purchased, if any) and by perforating through each bond and each coupon attached thereto the word “canceled” together with the date of cancellation.
ARTICLE 5. Status as Investments [50260. - 50261.]
All bonds including refunding bonds issued by a district are legal investments for all trust funds and for the funds of all insurance companies, banks, both commercial and savings, and trust companies, and for the State School Fund and for all sinking funds under the control of the State Treasurer. Whenever any money or funds may by law be invested in or loaned upon the security of bonds of cities, cities and counties, counties, or school districts, in the State, such money or funds may be invested in or loaned upon the security of the bonds of the district; and whenever bonds of cities, cities and counties, counties, or school districts by law may be used as security for the faithful performance or execution of any court or private trust or of any other act, bonds of the district may be so used.
All bonds of the district, to the same extent as bonds of any other municipality, are legal for use by any state or national bank or banks in the the State as security for the deposit of funds of the State or of any county, city and county, city, municipality or other public or municipal corporation within the State.
ARTICLE 6. Validation [50263. - 50263.]
An action to determine the validity of bonds, including refunding bonds, may be brought pursuant to Chapter 9 (commencing with Section 860) of Title 10 of Part 2 of the Code of Civil Procedure.
ARTICLE 7. Revenue Bonds [50265. - 50266.]
As an alternative procedure for the raising of funds, the district may issue bonds, payable from revenues of any facility or enterprise to be acquired or constructed by the district, in the manner provided by the Revenue Bond Law of 1941 (Chapter 6 (commencing with Section 54300) of Part 1 of Division 2 of Title 5 of the Government Code), all of the provisions of which are applicable to the district.
The district is a local agency within the meaning of the Revenue Bond Law of 1941 (Chapter 6 (commencing with Section 54300) of Part 1 of Division 2 of Title 5 of the Government Code). The term “enterprise” as used in the Revenue Bond Law of 1941 shall, for all purposes of this part, include transit facilities and any and all parts thereof and all additions, extensions and improvements thereto and all other facilities authorized to be acquired, constructed or completed by the district. A district may issue revenue bonds under the Revenue Bond Law of 1941, for any one or more facilities or enterprises authorized to be acquired, constructed, or completed by a district or, in the alternative, may issue revenue bonds under the Revenue Bond Law of 1941, for the acquisition, construction and completion of any one of such facilities. Nothing in this article shall prevent the district from availing itself of, or making use of, any procedure provided in this part for the issuance of bonds of any type or character for any of the facilities or works authorized hereunder, and all proceedings may be carried on simultaneously or, in the alternative, as the directors may determine.
CHAPTER 8. Annexation [50270. - 50277.]
Territory may be annexed to the district in the manner provided in this chapter.
Whenever the board finds and determines that additional territory will be benefited by annexation to the district, it shall pass a resolution to that effect.
The resolution shall be passed by a vote of two-thirds of the members of the board and be approved by the board of supervisors of the county in which the territory is situated.
The resolution shall:
Describe the boundaries of the territory proposed to be annexed.
Designate the proposed annexation by an appropriate name.
Declare that the area to be annexed to the district will be benefited by such annexation.
Name the time and place for the hearing of objections by any person interested in the proposed annexation.
The resolution, together with the names of the members of the board, voting for and against it shall be published pursuant to Section 6066 of the Government Code in a newspaper published in the territory proposed to be annexed, or if there is no such paper, then in some newspaper of general circulation, circulated in such territory.
On the day fixed for hearing or any day to which the hearing is adjourned, the board shall hear and consider any objections presented to the annexation of the territory. After the hearing of objections, if it shall be determined by a vote of two-thirds of all the members of the board that the territory proposed to be annexed will be benefited by such annexation, the board shall proceed to fix and determine the boundaries of the territory to be annexed to the district.
After making all necessary and proper changes in the boundaries, by a resolution passed by a vote of two-thirds of the members, the board shall order the annexation of the territory so described. The resolution, together with the names of the members of the board voting for and against the same shall be spread upon the minutes of the board.
Whenever any territory is annexed to the district it shall thereupon become a part of the district subject to all the liabilities and entitled to all the benefits of the district.
CHAPTER 9. Dissolution [50500. - 50507.]
If the district operates no transit facilities, or its exterior boundaries become coincident with the boundaries of a single city, the board may call an election at any time for the purpose of submitting to the voters of the district the question of whether the district will be dissolved. Upon the filing with the secretary of the district of a petition signed by voters within the district equal in number to at least 25 percent of the total vote cast at the last general statewide election, asking that the question of dissolution of the district be submitted to the voters of the district, the board shall call such an election.
The election for the purpose of submitting to the voters of the district the question of whether or not the district shall be dissolved shall be held within 60 days next succeeding the date on which the petition is filed.
Notice of any election for dissolution, whether called because of the filing of a petition or ordered by the board without petition, shall be published. The date fixed for the election shall not be less than 30 days from the date of the first publication of the notice.
The ballots for the election shall contain substantially the instructions required to be printed on ballots for use at general state and county elections and in addition the following:
The board shall canvass the vote. If a majority of the votes favor dissolution, the board shall by resolution dissolve the district.
The board shall file a certified copy of the resolution with the Secretary of State and for record in the office of the county recorder.
Upon dissolution the right, title, and interest to property owned or controlled by the district situated within the limits of any city vests absolutely in the city. If such property is situated outside the limits of a city, it vests in the county in which it is situated.
The board of supervisors is, ex officio, the governing body of any dissolved district. It may levy taxes and assessments and perform other acts necessary to wind up the district affairs and to raise money for the payment of outstanding indebtedness.
PART 6. YOLO COUNTY TRANSPORTATION DISTRICT [60000. - 60164.]
CHAPTER 1. General Provisions [60000. - 60062.]
This part shall be known and may be cited as the Yolo County Transportation District Act.
As used in this part, the following terms have the following meanings:
“Authority” means the Yolo County Transit Authority, a joint exercise of powers agency.
“Board of directors” means the Board of Directors of the Yolo County Transportation District.
“Board of supervisors” means the Yolo County Board of Supervisors.
“County” means the County of Yolo.
“District” means the Yolo County Transportation District created by Section 60004.
There is hereby created the Yolo County Transportation District. The jurisdiction of the district extends throughout the county, including all of the incorporated and unincorporated territory.
On and after July 1, 1997, the authority is dissolved and the district succeeds to, and is vested with, all of the rights, powers, duties, and obligations of the authority. The district is the successor to the authority’s interests in any property, its rights and obligations under any contract, any outstanding indebtedness of the authority, and its rights under any grants, without the necessity of any further action.
The district shall be governed by a five-member board of directors representing the county and cities in the county in the district, appointed as follows:
One member representing the County of Yolo, appointed by the board of supervisors.
One member representing the City of Davis, appointed by the city council of that city.
One member representing the City of West Sacramento, appointed by the city council of that city.
One member representing the City of Woodland, appointed by the city council of that city.
One member representing the City of Winters, appointed by the city council of that city.
An appointing authority shall appoint one of its members to serve as a member and one member to serve as an alternate member of the board of directors. The alternate member shall serve only in the absence of the regular member.
The University of California at Davis shall appoint a person to serve as a nonvoting ex officio member.
The Department of Transportation shall appoint a person to serve as a nonvoting ex officio member.
Voting members of the board of directors will receive a stipend per meeting to be established by the board in its bylaws.
Upon dissolution of the authority, employees of the authority shall be deemed to be employees of the district without any break in service nor any loss or reduction of compensation or benefits, except as may be imposed by express action of the district governing board.
The district shall assume the duties of public transit provider performed by the authority. On and after July 1, 1997, the Cities of West Sacramento, Davis, Woodland, and Winters are included within the district.
Additionally, the district is deemed to be each of the following agencies, with all of the powers and duties attendant thereto:
The consolidated transportation services agency for the county, with the concurrence of the Regional Transportation Planning Agency.
The congestion management agency for the county.
The district, at its first meeting, and thereafter annually at the meeting designated by the district, shall elect a chairperson who shall preside at all meetings, and a vice chairperson who shall preside in the absence of the chairperson. In the event of their absence or inability to act, the members present, by an order entered in the minutes, shall select one of their members to act as chairperson pro tempore, who, while so acting, shall have all the authority of the chairperson.
The district shall adopt rules for its proceedings consistent with the laws of the state.
A majority of the board of directors entitled to vote constitutes a quorum for the transaction of business. All official acts of the district require the affirmative vote of a majority of the board of directors entitled to vote.
The acts of the district shall be expressed by motion, resolution, or ordinance.
All meetings of the district shall be conducted pursuant to Chapter 9 (commencing with Section 54950) of Part 1 of Division 2 of Title 5 of the Government Code.
The district shall do all the following:
Adopt an annual budget.
Adopt an administrative code, by ordinance, which prescribes the powers and duties of the district officers, the method of appointment of the district employees, and methods, procedures, and systems of operation and management of the district.
Cause a postaudit of the financial transactions and records of the district to be made at least annually by a certified public accountant.
Do any and all things necessary to carry out the purposes of this part.
The district may hire an independent staff of its own or contract with any department or agency of the United States or with any public agency to implement this part.
The district may contract with private entities in conformance with applicable procurement procedures for the procurement of engineering, project management, and contract management services.
The district shall rely, to the extent possible, on existing state, regional, and local transportation planning and programming data and expertise, rather than on a large duplicative staff and set of plans.
The board of directors shall fix the compensation of the district’s officers and employees.
Notice of the time and place of a public hearing on the adoption of the annual budget shall be published pursuant to Section 6061 of the Government Code not less than 15 days prior to the day of the hearing.
The proposed annual budget shall be available for public inspection at least 15 days prior to the hearing.
The district may sue and be sued, except as otherwise provided by law, in all actions and proceedings, in all courts and tribunals of competent jurisdiction.
All claims for money or damages against the district are governed by Division 3.6 (commencing with Section 810) of Title 1 of the Government Code, except as provided therein, or by other statutes or regulations expressly applicable thereto.
The district may make contracts and enter into stipulations of any nature whatsoever, either in connection with eminent domain proceedings or otherwise, including, but not limited to, contracts and stipulations to indemnify and hold harmless, to employ labor, and to do all acts necessary and convenient for the full exercise of the powers granted in this part.
The district may contract with any department or agency of the United States, with any public agency, including, but not limited to, the Department of Transportation, any county, city, or district, or with any person or a private entity upon the terms and conditions that the district finds in its best interest for the procurement of engineering, project management, and contract management services.
Contracts for the purchase of services, supplies, equipment, and materials in excess of ten thousand dollars ($10,000) shall be awarded to the lowest responsible bidder after competitive bidding, except in an emergency declared by the district or by an executive committee to which the district has delegated responsibility to make that declaration.
If, after rejecting bids received under subdivision (a), the district determines and declares that, in its opinion, the services, supplies, equipment, or materials may be purchased at a lower price on the open market, the district may proceed to purchase these services, supplies, equipment, or materials in the open market without further observance of the provisions regarding contracts, bids, or advertisements.
Notwithstanding subdivision (a), the district shall comply with Federal Transit Administration Circular 4220.1 (d), as amended, relative to third-party contracting.
The district has no authority to impose property, sales, or special taxes, but may, with the concurrence of a majority of the member jurisdictions represented on the board of directors, cause to be submitted to voters of the district a ballot measure for the imposition of those taxes.
If approved as required by law, the district may impose and administer fees and other funding sources secured for transportation system maintenance and improvement.
The board of directors may set fares for public transit service by resolution or minute order.
Notwithstanding any other provision of law which relates to the functioning of the district as the Yolo County Congestion Management Agency District, the district may not exercise any authority over the land use decisions of a local governmental agency.
The district shall include in its bylaws a process for assuring that member jurisdictions of the district may reasonably determine to what extent their share of Mills-Alquist-Deddeh Act funds and other local state or federal revenue sources are used by the district. The district does not replace nor supplant the role of the Regional Transportation Planning Agency to allocate Mills-Alquist-Deddeh Act funds. Each member jurisdiction shall be financially responsible for its share of obligations incurred by the district on that member jurisdiction’s behalf. The district’s bylaws shall include a budget conflict resolution process.
The district may advocate and act on behalf of all district member jurisdictions with their concurrence to further Yolo County transportation system interests, funding, projects, and priorities.
The district shall act as a countywide forum for the coordination of transportation system planning, programming, and prioritization of significant projects.
The district may promulgate a plan for funding transportation projects within its jurisdiction.
The board of directors shall adopt priorities reflecting the district’s goals, including consideration of being designated as the federal Designated Recipient for Yolo County, consideration of additional transportation funding sources, examining the feasibility of Yolo County becoming a self-help county, and examining possible agency consolidations within Yolo County.
The district bylaws shall establish an advisory committee structure, which shall include a Technical Advisory Committee and a Citizen’s Advisory Committee and other advisory committees as it deems necessary, and shall establish a process for appealing decisions of the board of directors.
Transportation funding and project prioritization decisions made by the board of directors shall endeavor to be mode neutral, not biased in favor of any one transportation mode with the district seeking local concurrence when appropriate. Those decisions shall take into account the needs of the local jurisdictions, the overall county needs relative to streets, roads, transit, pedestrian, bicycle, telecommuting, light rail, heavy rail, and other alternative transportation mode projects, shall consider the movement of information and freight as well as people, and shall attempt to balance all transportation choices in order to most effectively utilize limited funding sources to the best advantage of Yolo County residents and others in the region.
The district shall act as the coordinating agency for all state and federal funding applications where appropriate.
CHAPTER 2. Transactions and Use Tax [60100. - 60107.]
A retail transactions and use tax ordinance applicable in the incorporated and unincorporated territory of the county may be imposed by the district in accordance with this chapter and Part 1.6 (commencing with Section 7251) of Division 2 of the Revenue and Taxation Code, if the tax ordinance is adopted by a majority of the board of directors and by a majority of the governing bodies of the appointing authorities listed in subdivision (a) of Section 60008, and imposition of the tax is subsequently approved by two-thirds of the voters voting on the measure at a special election called for that purpose by the board of supervisors, at the request of the district, and a county transportation expenditure plan is adopted pursuant to Section 60106.
A retail transactions and use tax approved by the voters shall remain in effect for not longer than 20 years, or any lesser period of time specified in the tax ordinance. The tax may be continued in effect, or reimposed, by a tax ordinance adopted by the district and the reimposition of the tax is approved by two-thirds of the voters.
The district, in the ordinance, shall do all of the following:
State the nature of the tax to be imposed.
Establish the tax rate, which may be in 14 percent increments and shall not exceed a maximum tax rate of 1 percent.
Specify the period during which the tax will be imposed.
Specify the purposes for which the revenue derived from the tax will be used.
The proposition shall include an appropriations limit for that entity pursuant to Section 4 of Article XIII B of the California Constitution.
The county shall conduct the special election called by the board of supervisors pursuant to Section 60100. If the measure is approved, the district shall reimburse the county for its cost in conducting the special election.
The special election shall be called and conducted in the same manner as provided by law for the conduct of special elections by a county.
The sample ballot to be mailed to the voters, pursuant to Section 13303 of the Elections Code, shall be the full proposition, as set forth in the ordinance calling the election, and the voter information handbook shall include the entire adopted county transportation expenditure plan.
Any transactions and use tax ordinance adopted pursuant to this chapter shall be operative on the first day of the first calendar quarter commencing more than 120 days after adoption of the ordinance.
Prior to the operative date of the ordinance, the district shall contract with the State Board of Equalization to perform all functions incidental to the administration and operation of the ordinance.
The revenues from the taxes imposed pursuant to this chapter may be allocated by the district for the construction and improvement of state highways, the construction, maintenance, improvement, and operation of local streets, roads, and highways, and the construction, improvement, and operation of public transit systems. For purposes of this section, “public transit systems” includes paratransit services.
A county transportation expenditure plan shall be prepared for the expenditure of the revenues expected to be derived from the tax imposed pursuant to this chapter, together with other federal, state, and local funds expected to be available for transportation improvements, for the period during which the tax is to be imposed.
The plan shall be adopted prior to the call of the election provided for in Section 60100.
The district may annually review and propose amendments to the county transportation expenditure plan adopted pursuant to Section 60106 to provide for the use of additional federal, state, and local funds, to account for unexpected revenues, or to take into consideration unforeseen circumstances.
The district shall notify the board of supervisors and the city council of each city in the county and provide them with a copy of the proposed amendments.
The proposed amendments shall become effective 45 days after notice is given.
CHAPTER 3. Bonds [60150. - 60164.]
As part of the ballot proposition to approve the imposition of a retail transactions and use tax, authorization may be sought to issue bonds to finance capital outlay expenditures as may be provided for in the adopted county transportation expenditure plan, payable from the proceeds of the tax.
The maximum bonded indebtedness that may be outstanding at any one time shall be an amount equal to the sum of the principal of, and interest on, the bonds, but not to exceed the estimated proceeds of the tax, as determined by the plan. The amount of bonds outstanding at any one time does not include the amount of bonds, refunding bonds, or bond anticipation notes for which funds necessary for the payment thereof have been set aside for that purpose in a trust or escrow account.
The bonds authorized by the voters concurrently with the approval of the retail transactions and use tax may be issued at any time by the district and shall be payable from the proceeds of the tax. The bonds shall be referred to as “limited tax bonds.” The bonds may be secured by a pledge of revenues from the proceeds of the tax.
The pledge of the tax to the limited tax bonds authorized under this chapter shall have priority over the use of any of the tax for “pay-as-you-go” financing, except to the extent that that priority is expressly restricted in the resolution authorizing the issuance of the bonds.
Limited tax bonds shall be issued pursuant to a resolution adopted at any time by a two-thirds vote of the district. Each resolution shall provide for the issuance of bonds in the amounts as may be necessary, until the full amount of bonds authorized have been issued. The full amount of bonds may be divided into two or more series and different dates of payment fixed for the bonds of each series. A bond need not mature on its anniversary date.
A resolution authorizing the issuance of bonds shall state all of the following:
The purposes for which the proposed debt is to be incurred, which may include all costs and estimated costs incidental to, or connected with, the accomplishment of those purposes, including, without limitation, engineering, inspection, legal, fiscal agents, financial consultant and other fees, bond and other reserve funds, working capital, bond interest estimated to accrue during the construction period and for a period not to exceed three years thereafter, and expenses of all proceedings for the authorization, issuance, and sale of the bonds.
The estimated cost of accomplishing those purposes.
The amount of the principal of the indebtedness.
The maximum term the bonds proposed to be issued shall run before maturity, which shall not be beyond the date of termination of the imposition of the retail transactions and use tax.
The maximum rate of interest to be paid, which shall not exceed the maximum allowable by law.
The denomination or denominations of the bonds, which shall not be less than five thousand dollars ($5,000).
The form of the bonds, including, without limitation, registered bonds and coupon bonds, to the extent permitted by federal law, and the form of any coupons to be attached thereto, the registration, conversion, and exchange privileges, if any, pertaining thereto, and the time when all of, or any part of, the principal becomes due and payable.
The resolution may also contain any other matters authorized by this chapter or any other provision of law.
The bonds shall bear interest at a rate or rates not exceeding the maximum allowable by law, payable at intervals determined by the commission.
In the resolution authorizing the issuance of the bonds, the district may also provide for the call and redemption of the bonds prior to maturity at the times and prices and upon other terms as specified. However, no bond is subject to call or redemption prior to maturity, unless it contains a recital to that effect or unless a statement to that effect is printed.
The principal of, and interest on, the bonds shall be payable in lawful money of the United States at the office of the treasurer of the district, or at other places as may be designated, or at both the office and other places at the option of the holders of the bonds.
The bonds, or each series thereof, shall be dated and numbered consecutively and shall be signed by the chairperson or vice chairperson of the district and the auditor-controller of the district, and the official seal, if any, of the district shall be attached.
The interest coupons of the bonds shall be signed by the auditor-controller of the district. All of the signatures and seal may be printed, lithographed, or mechanically reproduced.
If any officer whose signature appears on the bonds or coupons ceases to be that officer before the delivery of the bonds, the officer’s signature is as effective as if the officer had remained in office.
The bonds may be sold as the district determines by resolution, and the bonds may be sold at a price below par, whether by negotiated or public sale.
Delivery of any bonds may be made at any place either inside or outside the state, and the purchase price may be received in cash or bank credits.
All accrued interest and premiums received on the sale of the bonds shall be placed in the fund to be used for the payment of the principal of, and interest on, the bonds, and the remainder of the proceeds of the bonds shall be placed in the treasury of the district and applied to secure the bonds or for the purposes for which the debt was incurred. However, when the purposes have been accomplished, any money remaining shall be either (a) transferred to the fund to be used for the payment of principal of, and interest on, the bonds or (b) placed in a fund to be used for the purchase of the outstanding bonds in the open market at prices and in the manner, either at public or private sale or otherwise, as determined by the district. Bonds so purchased shall be canceled immediately.
The district may provide for the issuance, sale, or exchange of refunding bonds to redeem or retire any bonds issued by the district upon the terms, at the times and in the manner which it determines.
Refunding bonds may be issued in a principal amount sufficient to pay all, or any part of, the principal of the outstanding bonds, the premiums, if any, due upon call and redemption thereof prior to maturity, all expenses of the refunding, and either of the following:
The interest upon the refunding bonds from the date of sale thereof to the date of payment of the bonds to be refunded out of the proceeds of the sale of the refunding bonds or to the date upon which the bonds to be refunded will be paid pursuant to call or agreement with the holders of the bonds.
The interest upon the bonds to be refunded from the date of sale of the refunding bonds to the date of payment of the bonds to be refunded or to the date upon which the bonds to be refunded will be paid pursuant to call or agreement with the holder of the bonds.
The provisions of this chapter for the issuance and sale of bonds apply to the issuance and sale of refunding bonds.
The district may borrow money in anticipation of the sale of bonds which have been authorized pursuant to this chapter, but which have not been sold or delivered, and may issue negotiable bond anticipation notes therefor and may renew the bond anticipation notes from time to time. However, the maximum maturity of any bond anticipation notes, including the renewals thereof, shall not exceed five years from the date of delivery of the original bond anticipation notes.
The bond anticipation notes, and the interest thereon, may be paid from any money of the district available therefor, including the revenues from the tax. If not previously otherwise paid, the bond anticipation notes, or any portion thereof, or the interest thereon, shall be paid from the proceeds of the next sale of the bonds of the agency in anticipation of which the notes were issued.
The bond anticipation notes shall not be issued in any amount in excess of the aggregate amount of the bonds which the district has been authorized to issue, less the amount of any bonds of the authorized issue previously sold, and also less the amount of other bond anticipation notes therefor issued and then outstanding. The bond anticipation notes shall be issued and sold in the same manner as the bonds.
The bond anticipation notes and the resolutions authorizing them may contain any provisions, conditions, or limitations which a resolution of the district may contain.
Any bonds issued under this chapter are legal investment for all trust funds; for the funds of insurance companies, commercial and savings banks, and trust companies; and for state school funds; and whenever any money or funds may, by any law now or hereafter enacted, be invested in bonds of cities, counties, school districts, or other districts within the state, that money or funds may be invested in the bonds issued under this chapter, and whenever bonds of cities, counties, school districts, or other districts within the state may, by any law now or hereafter enacted, be used as security for the performance of any act or the deposit of any public money, the bonds issued under this chapter may be so used. The provisions of this chapter are in addition to all other laws relating to legal investments and shall be controlling as the latest expression of the Legislature with respect thereto.
Any action or proceedings wherein the validity of the adoption of the retail transactions and use tax ordinance provided for in this chapter or the issuance of any bonds thereunder or any of the proceedings in relation thereto is contested, questioned, or denied, shall be commenced within six months from the date of the election at which the ordinance is approved; otherwise, the bonds and all proceedings in relation thereto, including the adoption and approval of the ordinance, shall be held to be valid and in every respect legal and incontestable.
PART 7. MARIN COUNTY TRANSIT DISTRICT [70000. - 80019.]
CHAPTER 1. General Provisions [70000. - 70014.]
ARTICLE 1. Definitions [70000. - 70006.]
This part shall be known and cited as the “Marin County Transit District Act of 1964.”
Unless the context otherwise requires, the provisions of this article govern the construction of this part.
“District” means the Marin County Transit District formed under this part.
“Board” means the board of directors of this district.
“Voter” means any elector who is registered under the Elections Code.
“Transit” means the transportation of passengers only and their incidental baggage by means other than by chartered bus, sightseeing bus, or any other motor vehicle not on an individual passenger fare-paying basis. Nothing in this section shall be construed to prohibit the district from leasing its buses to private certified public carriers or to prohibit the district from providing school bus service for the transportation of pupils between their homes and schools.
“Transit works” or “transit facilities” means all real and personal property, equipment, rights, or interests owned or to be acquired by the district for transit service.
ARTICLE 2. General Provisions [70010. - 70014.]
It shall be the purpose of the Marin County Transit District to develop, finance, organize, and provide local Marin County transit service in a manner consistent with an overall San Francisco Bay Area regional transit system.
The Marin County Transit District may be created as provided in this part and when so created may exercise the powers herein granted.
Except as otherwise provided in this part elections shall be held and conducted and the result ascertained, determined, and declared in all respects as nearly as practicable in conformity with the general election laws of the State.
Except as otherwise provided in this part all ordinances and notices which are required to be published shall be published within the district pursuant to Section 6066 of the Government Code.
Whenever the signature of any officer or employee of a district or of any member of the retirement board or of any officer or employee of the retirement system is authorized or required under the provisions of this part, except in the single instance provided in Section 70243, the signature may be made by the use of a plate bearing facsimilies of such signatures.
CHAPTER 2. Formation of District [70020. - 70055.]
ARTICLE 1. General Provisions [70020. - 70022.]
The County of Marin may organize and incorporate as the Marin County Transit District.
The request for the formation of the Marin County Transit District may be made by resolution or by petition as set out in this chapter.
The district may include incorporated or unincorporated territory within the County of Marin.
ARTICLE 2. Request by Resolution [70025. - 70026.]
The Board of Supervisors of the County of Marin may pass a resolution declaring that in its opinion public interest or necessity demands the creation and maintenance of the Marin County Transit District.
The resolution may state the transit facilities proposed to be first acquired, but failure to acquire such transit facilities shall not affect the validity of the district.
ARTICLE 3. Request by Petition [70030. - 70033.]
Instead of a resolution, a petition may be presented to the board of supervisors signed by voters within Marin County equal in number to at least 25 percent of the total vote cast at the last general election.
The petition shall contain substantially the same declarations and statements required to be contained in the resolution adopted by the board of supervisors under this chapter and declare that, in the opinion of the petitioners, public interest or necessity demands the creation and maintenance of the transit district.
The petition may be on separate papers, but each paper shall contain the affidavit of the person who circulated it certifying that each name signed thereto is a true signature of the person whose name it purports to be.
The County Elections Official of the County of Marin shall compare the signatures to the petition with the affidavits of registration and certify to their sufficiency or insufficiency.
ARTICLE 4. Election [70035. - 70044.]
Upon adoption of the resolution or of a sufficient petition, the board of supervisors shall hold a hearing on the question of forming a Marin County Transit District. All interested persons shall be given an opportunity to express their views at the hearing.
The board of supervisors shall have the power to exclude areas which in the board’s determination would not receive reasonable benefit from inclusion in the district. Incorporated areas shall not be divided but shall be as a whole either included or excluded from the district.
After the conclusion of the hearing, the board of supervisors shall in case of initiation by petition and may in case of initiation by resolution call an election within the proposed district for the purpose of determining whether the proposed district will be created and established.
The board of supervisors shall publish notice of the election within the proposed district.
The notice shall state the name of the proposed district, and describe the boundaries thereof.
The ballot for the election shall contain such instructions as are required by law to be printed thereon and in addition thereto the following:
No person shall be entitled to vote at the election unless he is a voter of the territory included in the proposed district.
The election may be held on the same day as any other state, county, or city election, and be consolidated therewith.
The board of supervisors shall meet on the Tuesday next succeeding the day of the election and canvass the returns.
The board of supervisors shall make all provisions for the holding of the election throughout the district as proposed, and the cost of said election shall be a charge against the general funds of the county.
ARTICLE 5. Establishment of the District [70050. - 70050.]
If a majority of the electors voting on the proposition vote in favor of the creation and establishment of the district, the board of supervisors shall cause a certified copy of the order declaring the result of the election to be filed in the office of the Secretary of State, from and after which the establishment of the district shall be deemed complete.
ARTICLE 6. Contest of Incorporation [70055. - 70055.]
No informality in any proceeding or in the conduct of the election, not substantially affecting adversely the legal rights of any citizen, shall be held to invalidate the incorporation of the district. Any proceedings wherein the validity of incorporation is denied shall be commenced within three months from the date of filing the order declaring the result of the election with the Secretary of State, otherwise the incorporation and the legal existence of the district shall be held to be valid and in every respect legal and incontestable.
CHAPTER 3. Internal Organization of District [70060. - 70095.]
ARTICLE 1. Government [70060. - 70061.]
The governing body of the district shall consist of the members of the board of supervisors and two members, who shall be a mayor or councilman of a city, selected by the city selection committee which selects the city members of the local agency formation commission in the county pursuant to Chapter 6.6 (commencing with Section 54773) of Part 1, Division 2, Title 5, of the Government Code. The chairman of the board of supervisors shall be the chairman of the board of directors of the district. The county auditor shall be ex officio auditor of the district, the county tax collector-treasurer shall be ex officio tax collector-treasurer of the district and the county clerk shall be the ex officio clerk of the district.
The city members of the governing body of the district shall serve for terms of two years commencing on the first Monday of January in each even-numbered year, and until their successors are selected and qualified. If a city member ceases to be a mayor or councilman during his term, his membership on the governing board shall thereafter be considered vacant.
The city selection committee shall meet at the call of the chairman of the governing body, or at the request of 60 percent of the members of the committee, to fill vacancies and make selections for prospective terms, on the governing body.
ARTICLE 2. Powers and Duties of Directors [70070. - 70079.]
The chairman is the presiding officer of the board and he shall vote on the propositions passed upon by the board.
The first meeting of the board shall be held within 10 days after the board of supervisors certifies the results of the election to the Secretary of State pursuant to Section 70050. The board may make its own rules of procedure and determine the place and time of its meeting.
The board shall select one of its members vice chairman, who shall preside in the absence of its chairman. The board shall provide for and select such officers as it deems necessary to conduct the affairs of the district.
All matters and things necessary for the proper administration of the affairs of the district which are not provided for in this part shall be provided for by the board.
The board shall supervise and regulate every transit facility owned and operated by the district, including the fixing of rates, rentals, charges and classifications, and the making and enforcement of rules, regulations, contracts, practices, and schedules, for or in connection with any transit facility owned or controlled by the district.
The board may either operate the transit system itself or a part thereof or it may contract with any other public or private agency or corporation to operate all or part of the transit system for the district or it may contract with any other public or private agency or corporation for the improvement in transit services, facilities, equipment or operations being operated and conducted by said agency or corporation in, and, or, out of, the district.
Marin County Ordinance 617 (Merit System Ordinance) as amended or hereafter amended shall be applicable to all personnel of the district, except to the extent the provisions of such ordinance are in conflict with the provisions of Chapter 4 (commencing with Section 70120) of this part.
The board may from time to time contract for or employ any professional service required by the district or for the performance of work or services which cannot satisfactorily be performed by the regular employees of the district.
The auditor shall provide the board with an annual audit of all books and accounts of the district.
Payment of demands against the district and disbursement of district funds shall be in the manner provided for demands against a county and disbursements of funds of a county.
ARTICLE 3. Meetings and Legislation [70085. - 70089.]
All meetings of the board shall be conducted in a manner prescribed by the Ralph M. Brown Act, Chapter 9 (commencing with Section 54950), Part 1, Division 2, Title 5 of the Government Code.
A majority of the board constitutes a quorum for the transaction of business.
The board shall establish rules for its proceedings and board members shall be allowed necessary traveling and personal expenses incurred in performance of duties authorized by the board.
The acts of the board shall be expressed by motion, resolution or ordinance. No ordinance, resolution or motion shall have any validity or effect unless passed by the affirmative votes of a majority of the directors. District ordinances shall be adopted in the same manner as provided for adoption of ordinances by a county.
The enacting clause of all ordinances shall be as follows: “Be it ordained by the board of directors of the Marin County Transit District.” All ordinances shall be signed by the chairman or vice chairman of the board and attested by the clerk.
ARTICLE 4. Other Officers [70095. - 70095.]
The board may appoint and fix the salary of a general manager who shall have full charge of the acquisition, construction, maintenance and operation of the facilities of the district, and also of the administration of the business affairs of the district.
CHAPTER 4. Labor Provisions [70120. - 70129.]
Employees shall have the right to self-organization, to form, join, or assist labor organizations, to bargain collectively through representatives of their own choosing, and to engage in other concerted activities for the purpose of collective bargaining or other mutual aid or protection. It is declared to be in the public interest that the district shall not express any preference for one union over another. Notwithstanding any other provision of this part, whenever a majority of the employees employed by the district in a unit appropriate for collective bargaining indicate a desire to be represented by a labor organization, the district, upon determining as provided in Section 70122 that the labor organization represents the employees in the appropriate unit, shall enter into a written contract with the accredited representative of the employees governing wages, salaries, hours and working conditions. In case of a dispute over wages, salaries, hours or working conditions, which is not resolved by negotiations in good faith between the district and the labor organization, upon the request of either, the district and the labor organization may submit the dispute to the decision of the majority of an arbitration board, and the decision of the majority of the arbitration board shall be final. The arbitration board shall be composed of two representatives of the district, and two representatives of the labor organization, and they shall endeavor to agree upon the selection of the fifth member. If they are unable to agree, the names of five persons experienced in labor arbitration shall be obtained from the California State Mediation and Conciliation Service. The labor organization and the district shall, alternately, strike a name from the list so supplied, and the name remaining after the labor organization and the district have stricken four names, shall be designated as the arbitrator. The labor organization and the district shall determine by lot who shall first strike from the list. The decision of a majority of the arbitration board shall be final and binding upon the parties. The expenses of arbitration shall be borne equally by the parties. Each party shall bear his or her own costs.
In the event the board and the representatives of the employees do not agree to submit the dispute to an arbitration board as herein provided, the California State Mediation and Conciliation Service may be notified by either party that a dispute exists and that there is no agreement to arbitrate. The service shall determine whether or not the dispute may be resolved by the parties and, if not, the issues concerning which the dispute exists. Upon the determination, the service shall certify its findings to the Governor who shall, within 10 days of receipt of certification appoint a fact finding commission consisting of three persons which shall immediately convene and inquire into and investigate the issues involved in the dispute. The commission shall report to the Governor within 30 days of the date of its creation.
After the creation of the commission and for 30 days after the commission has made its report to the Governor, no change, except by mutual agreement, shall be made by the parties to the controversy in the conditions out of which the dispute arose and service to the public shall be provided.
A contract or agreement shall not be made, or assumed, with any labor organization, association, group, or individual that denies membership to, or in any manner discriminates against, any employee on any basis listed in subdivision (a) of Section 12940 of the Government Code, as those bases are defined in Sections 12926 and 12926.1 of the Government Code. However, the organization may preclude from membership any individual who advocates the overthrow of the government by force or violence.
The district shall not discriminate with regard to employment against any person on any basis listed in subdivision (a) of Section 12940 of the Government Code, as those bases are defined in Sections 12926 and 12926.1 of the Government Code, except as otherwise provided in Section 12940 of the Government Code.
If there is a question whether a labor organization represents a majority of employees or whether the proposed unit is or is not appropriate, such matters shall be submitted to the State Conciliation Service for disposition. The State Conciliation Service shall promptly hold a public hearing after due notice to all interested parties and shall thereupon determine the unit appropriate for the purposes of collective bargaining. In making such determination and in establishing rules and regulations governing petitions, the conduct of hearings and elections, the State Conciliation Service shall be guided by relevant federal law and administrative practice, developed under the Labor-Management Relations Act, 1947, as presently amended.
The State Conciliation Service shall provide for an election to determine the question of representation and shall certify the results to the parties. Any certification of a labor organization to represent or act for the employees in any collective bargaining unit shall not be subject to challenge on the grounds that a new substantial question of representation within such collective bargaining unit exists until the lapse of one year from the date of certification or the expiration of any collective bargaining agreement, whichever is later; provided, that no collective bargaining agreement shall be construed to be a bar to representation proceedings for a period of more than two years.
Whenever the district acquires existing facilities from a publicly or privately owned public utility, either in proceedings by eminent domain or otherwise, the district shall assume and observe all existing labor contracts. To the extent necessary for operation of facilities, all of the employees of such acquired public utility whose duties pertain to the facilities acquired shall be appointed to comparable positions in the district without examination, subject to all the rights and benefits of this part, and these employees shall be given sick leave, seniority, vacation and pension credits in accordance with the records and labor agreements of the acquired public utility. Members and beneficiaries of any pension or retirement system or other benefits established by that public utility shall continue to have the rights, privileges, benefits, obligations and status with respect to such established system. No employee of any acquired public utility shall suffer any worsening of his wages, seniority, pension, vacation or other benefits by reason of the acquisition.
The district may extend the benefits of this section to officers or supervisory employees of the acquired utility.
The district shall not acquire any existing system or part thereof whether by purchase, lease, condemnation, or otherwise, nor shall the district dispose of or lease any transit system or part thereof, nor merge, consolidate or coordinate any transit system or part thereof, or reduce or limit the lines or service of any existing system or of its system, or terminate any lease arrangement or management contract, unless it shall first have made adequate provision for any employees who are or may be displaced. The terms and conditions of such provision shall be a proper subject of collective bargaining.
Notwithstanding any provision of the Government Code, employees of this district may authorize and, upon that authorization, the district may make deductions from their wages and salaries as follows:
Pursuant to a collective bargaining agreement with a duly designated or certified labor organization for the payment of union dues, fees, or assessments.
For the payment of contributions pursuant to any health and welfare plan or pension or retirement plan.
For any purpose for which deductions may be authorized by employees of any private employer.
The obligation of the district to bargain in good faith with a duly designated or certified labor organization and to execute a written collective bargaining agreement with such labor organization covering the wages, hours and working conditions of the employees represented by such labor organization in an appropriate unit, and to comply with the terms thereof shall not be limited or restricted by the provisions of the Government Code or other laws or statutes and the obligation of the district to bargain collectively shall extend to all subjects of collective bargaining which are or may be proper subjects of collective bargaining with a private employer, including retroactive provisions. Notwithstanding the provisions of the Government Code or other laws or statutes, the district shall make deductions from wages and salaries of its employees upon receipt of authorization therefor for the payment of union dues, fees or assessments, for the payment of contributions pursuant to any health and welfare plan or pension plan or for any other purpose for which deductions may be authorized by employees of any private employer, where such deductions are pursuant to a collective bargaining agreement with a duly designated or certified labor organization.
The district may provide for a retirement system; provided, that the adoption, terms and conditions of any retirement system covering employees of the district represented by a labor organization in accordance with this section shall be pursuant to a collective bargaining agreement between such labor organization and the district.
The district shall take such steps as may be necessary to obtain coverage for the district and its employees under Title II of the Federal Social Security Act, as amended, and the related provisions of the Federal Insurance Contributions Act, as amended.
The district shall take such steps as may be necessary to obtain coverage for the district and its employees under the workers’ compensation, unemployment compensation disability and unemployment insurance laws of the State of California.
CHAPTER 5. Retirement System [70130. - 70130.]
The Marin County Employees Retirement System and the laws relating thereto or as hereafter amended shall be applicable to the officers and employees of the district, except as otherwise provided in Chapter 4 (commencing with Section 70120) of this part.
CHAPTER 6. Powers and Functions of District [70160. - 70223.5.]
ARTICLE 1. Corporate Power [70160. - 70162.]
The district has perpetual succession and may adopt a seal and alter it at pleasure.
The district may sue and be sued, except as otherwise provided by law, in all actions and proceedings, in all courts and tribunals of competent jurisdiction.
The district may exercise the right of eminent domain to take any property necessary or convenient to the exercise of the powers granted in this part. The district in exercising such power shall, in addition to the damage for the taking, injury or destruction of property, also pay the cost of removal, reconstruction or relocation of any structure, railway, mains, pipes, conduits, cables or poles of any public utility which is required to be moved to a new location.
ARTICLE 2. Contracts [70165. - 70166.]
The district may make contracts and enter into stipulations of any nature whatsoever, either in connection with eminent domain proceedings or otherwise, including, without limiting the generality of the foregoing, contracts and stipulations to indemnify and save harmless, to employ labor, and to do all acts necessary and convenient for the full exercise of the powers granted in this part.
No officer or employee of the district shall in any manner be interested, directly or indirectly, in any contract awarded or to be awarded by the board, or in the profits to be derived therefrom contrary to the provisions of Article 4 (commencing with Section 1090), Chapter 1, Division 4, Title 1 of the Government Code.
ARTICLE 4. Property [70175. - 70176.]
The district may take by grant, purchase, gift, devise or lease, or condemn in proceedings under eminent domain, or otherwise acquire, and hold and enjoy, real and personal property of every kind within or without the district necessary to the full or convenient exercise of its powers. The board may lease, mortgage, sell, or otherwise dispose of any real or personal property within or without the district when in its judgment it is for the best interests of the district so to do.
Exercise of the powers provided under Section 70175 shall be undertaken in the same manner and pursuant to the same procedures as in the exercise of like powers by the County of Marin, except as may otherwise be expressly provided in this part.
ARTICLE 5. Transit Facilities and Service [70180. - 70187.]
The district may acquire, construct, own, operate, control or use rights-of-way, rail lines, buslines, stations, platforms, switches, yards, terminals and any and all other facilities necessary or convenient for transit service within or partly without the district underground, upon or above the ground and under, upon or over public streets or other public ways, or waterways, together with all physical structures necessary or convenient for the access of persons or vehicles thereto and may acquire any interest in or rights to the joint use of any or all of the foregoing; provided that:
Installations in state freeways shall be subject to the approval of the State Department of Public Works and installations in other state highways shall be subject to Article 2 (commencing with Section 670), Chapter 3, Division 1 of the Streets and Highways Code.
Installations in city streets, parks, or other property devoted to municipal use, shall be subject to the approval of the city council having jurisdiction thereof.
The district may acquire, contract and negotiate for the services of any and all employees of any public or private agency or corporation operating transit facilities within the district.
The district may without limitation by any other provisions of this part requiring approval of indebtedness, accept contributions of money, rights-of-way, labor, materials, and any other property for the acquisition, construction, maintenance, and operation of transit facilities, and may without limitation by any other provisions of this part enter into any contracts and cooperation with and accept cooperation from the State, or any department, instrumentality, or agency thereof, or any public agency in the acquisition, construction, maintenance, and operation of, and in financing the acquisition, construction, maintenance, and operation of, any such transit facilities.
The district may lease or contract for the use of its transit facilities, or any portion thereof, to any operator, and may provide for subleases by such operator upon such terms and conditions as it deems in the public interest. The word “operator” as used in this section means any city or public agency or any person, firm or private corporation.
The district may construct and operate or acquire and operate works and facilities in, under, upon, over, across, or along any street or public highway or any stream, bay or watercourse, or over any of the lands which are the property of the State, to the same extent that such rights and privileges appertaining thereto are granted to municipalities within the State, and to install adequate bus stops, including the painting of curbs, subject to the governing body in charge of such streets, highways, stream, watercourse or lands.
The district may enter into agreements for the joint use of any property and rights by the district and any city, public agency or public utility operating transit facilities; may enter into agreements with any city, public agency or public utility operating any transit facilities, either wholly or partially within, or without, the district, for the joint use of any property of the district or of such city, public agency or public utility, or the establishment of through routes, joint fares, transfer of passengers or pooling arrangements.
The rates and charges for service furnished pursuant to this part shall be fixed by the board and shall be reasonable.
The district shall be subject to the provisions of Division 14.8 (commencing with Section 34500) of the Vehicle Code with respect to the operation of buses and to the rules and regulations prescribed by the Department of the California Highway Patrol pursuant to that chapter regulating the safe operation of buses.
ARTICLE 6. Indebtedness [70200. - 70201.]
The district shall have the power to obtain temporary transfers of funds in accordance with the last paragraph of Section 31, Article IV of the State Constitution.
The district may accept, without limitation by any other provisions of this part requiring approval of indebtedness, contributions or loans from the United States, this State, or any department, instrumentality, or agency of either thereof, for the purpose of financing the acquisition, construction, maintenance, and operation of transit facilities, and may enter into contracts and cooperate with, and accept cooperation from, the United States, this State, or any department, instrumentality, or agency of either thereof, in the acquisition, construction, maintenance, and operation, and in financing the acquisition, construction, maintenance, and operation of any such transit facilities in accordance with any legislation which Congress or the Legislature of the State of California may have heretofore adopted or may hereafter adopt, under which aid, assistance, and cooperation may be furnished by the United States or this State in the acquisition, construction, maintenance, and operation or in financing the acquisition, construction, maintenance and operation of any such transit facilities. The district may do any and all things necessary in order to avail itself of such aid, assistance, and cooperation under any federal or state legislation now or hereafter enacted. Any evidence of indebtedness issued under this section shall constitute a negotiable instrument.
ARTICLE 7. Property Taxation [70210. - 70220.]
The district may levy, and collect or cause to be collected, taxes for any lawful purpose subject to a maximum limit of five cents ($0.05) per one hundred dollars ($100) of assessed valuation within the district.
The maximum tax rate set forth in Section 70210 may be increased to an amount approved by a majority of the electors of the district voting at a special election called for such purpose.
If, in the opinion of the board, the transit operation revenues will not be sufficient for any and all lawful purposes the board shall levy a tax for such purpose or purposes and fix the amount of money necessary to be raised therefor by taxation.
The board shall, in addition to the general tax levy as set forth in Section 70210, levy and collect annually until the district’s bonds are paid, or until there is a sum in the treasury of the district set apart for that purpose to meet all sums coming due for principal and interest on the bonds as they become due a tax sufficient to pay the annual interest on the bonds and such part of the principal thereof as becomes due before the proceeds of a tax levied at the next general tax levy will be available. If the maturity of the indebtedness created by the issue of bonds begins more than one year after the date of the issuance thereof, the tax shall be levied and collected annually at the time and in the manner aforesaid, sufficient to pay the interest on the indebtedness as it falls due and to constitute a sinking fund for the payment of the principal on or before maturity.
The board may provide for the assessment, levy, and collection of taxes by the district, including the sale of property to the district for delinquent taxes, with penalties, interest, and cost.
The board shall avail itself of the assessments made by the assessor of the county and of the assessments made by the State Board of Equalization for the county and shall take such assessments as the basis for district taxation and have its taxes collected by the tax collector of the county.
In such case the county auditor shall, on or before the third Monday in August of each year, transmit to the board a statement in writing showing the total value of all property within the district, ascertained from the assessments referred to in Section 70214 as equalized.
The board shall on or before the first day of September fix the rate of taxes, designating the number of cents upon each one hundred dollars ($100) using as a basis the value of property transmitted to the board by the county auditor, which rate of taxation shall be sufficient to raise the amount previously fixed by the board. These acts by the board shall constitute a valid assessment of the property and a valid levy of the taxes so fixed but the rate of taxation shall not exceed the limit imposed by this article.
The board shall immediately after fixing the rate of taxes as above provided transmit to the county auditor of the county a statement of the rate of taxes fixed by the board.
The district’s taxes so levied shall be collected at the same time and in the same manner as county taxes. When collected the net amount, ascertained as provided in this article, shall be paid to the treasurer of the district, under the general requirements and penalties provided by law for the settlement of other taxes.
Whenever any real property has been sold for taxes and has been redeemed, the money paid for redemption shall be apportioned and paid to the district by the county treasurer in the proportion which the tax due to the district bears to the total tax for which the property was sold.
All taxes levied under this part are a lien on the property on which they are levied. The enforcement of the collection of such taxes shall be in the same manner and by the same means provided by law for the enforcement of liens for county taxes, all the provisions of law relating to the enforcement of the latter being made a part of this part so far as applicable.
ARTICLE 8. Retail Transactions and Use Tax [70223. - 70223.5.]
A retail transactions and use tax ordinance may be adopted by the board in accordance with Part 1.6 (commencing with Section 7251) of Division 2 of the Revenue and Taxation Code, if two-thirds of the electors voting on the measure vote to authorize its enactment at a special election called for that purpose by the board. Notwithstanding Sections 7261 and 7262 of the Revenue and Taxation Code, the retail transactions and use tax ordinance shall provide for imposition of a tax at a rate of one-half of 1 percent or at a lower rate specified in the ordinance.
Any transactions and use tax ordinance adopted shall be operative on the first day of the first calendar quarter commencing not less than 180 days after adoption of the ordinance.
The district may contract with the State Board of Equalization for its service in the preparations necessary to administer a transactions and use tax ordinance. The costs to be covered by the contract are to be for services of the types described in Section 7272 of the Revenue and Taxation Code for preparatory work up to the date of the adoption of the ordinance. Any dispute as to the amount of the costs shall be resolved in the same manner as provided in that section.
Prior to the operative date of the transactions and use tax ordinance, the district shall contract with the State Board of Equalization to perform all functions incident to the administration and operation of the ordinance.
If the district shall not have contracted with the State Board of Equalization prior to the operative date of its transactions and use tax ordinance, it shall nevertheless so contract, and, in such case, the operative date shall be the first day of the first calendar quarter following the execution of the contract.
Repeal of the transactions and use tax ordinance shall not be operative earlier than the first day of the first calendar quarter following the adoption of the ordinance of repeal.
CHAPTER 7. Bonds [70225. - 70266.]
ARTICLE 1. Issuance [70225. - 70237.]
The district may from time to time incur a bonded indebtedness as provided in this chapter to pay the cost of acquiring, constructing or completing the whole or any portion of any transit facilities, or for acquiring any works, lands, structures, rights, equipment, or other property necessary or convenient to carry out the objects, purposes, or powers of the district. The total amount of bonds issued and outstanding shall not exceed twenty percent (20%) of the assessed value of the taxable property of the district as shown by the last equalized assessment roll of the County of Marin.
Whenever the board by resolution passed by vote of two-thirds of all its members determines that the public interest or necessity demands the acquisition, construction, or completion by the district of any transit facilities or any works, lands, structures, rights, equipment, or other property necessary or convenient to carry out the objects, purposes, or powers of the district, the cost of which will be too great to be paid out of the ordinary annual income and revenue of the district, it may at any subsequent meeting of the board provide by ordinance for the submission of the proposition of incurring a bonded indebtedness for the purpose set forth in the resolution to the voters of the district at a special bond election held for that purpose.
The ordinance calling a special bond election shall fix the date on which the election will be held, and the manner of holding the election and of voting for or against incurring the indebtedness. It shall also recite the objects and purposes for which the indebtedness is proposed to be incurred, the estimated cost of the transit facilities, works, lands, structures, rights, equipment, or other property proposed to be acquired, constructed, or completed, the amount of the principal of the indebtedness to be incurred therefor, and the maximum rate of interest to be paid on the indebtedness, which shall not exceed 6 percent per annum, payable semiannually or annually the first year and thereafter semiannually.
Propositions for incurring indebtedness for more than one object or purpose may be submitted at the same election.
Any special bond election may be held separately, or may be consolidated with any other election authorized by law at which the voters of the district may vote. If a special bond election is consolidated with any other election, the provisions of this chapter setting forth the procedure for the calling and holding of the special bond election shall be complied with, except that the ordinance calling the election need not set forth the election precincts, polling places, and officers of election, but may provide that the precincts, polling places, and officers of election shall be the same as those set forth in the ordinance, notice, or other proceedings calling the election with which the special bond election is consolidated, and shall refer to the ordinance, notice, or other proceedings by number and title, or by other definite description.
The ordinance shall be published, and no other notice of election need be given.
The board shall comply with Article 3 (commencing with Section 9160) of Chapter 2 of Division 9 of the Elections Code, the provisions of which are applicable to any bond election held pursuant to this article.
The votes of sixty percent (60%) of all voters voting on the proposition at the election are required to authorize the issuance of bonds under this chapter.
If the proposition submitted at a special bond election fails to receive the requisite number of votes, the board shall not within six months after the election hold another special election for the submission of a proposition of incurring a bonded indebtedness substantially the same as the proposition voted upon at the prior election unless a petition signed by voters within the district equal in number to at least 15 percent of the total vote cast at the last general statewide election is filed with the board, requesting that the proposition, or a proposition substantially the same, be submitted at an election to be called for that purpose.
ARTICLE 2. Form and Content [70240. - 70243.]
Bonds authorized by this chapter shall mature serially in amounts to be fixed by the board; except that payment shall begin not later than 10 years from the date thereof and shall be completed in not more than 50 years from that date.
The board may divide any issue of bonds authorized pursuant to this chapter into two or more series, and may fix different dates of issuance and different maturity dates for the bonds of each series. The bonds of each series shall mature serially in amounts to be fixed by the board, and the board shall fix a date not more than 10 years from the date of issuance of each series for the earliest maturity of such series, and shall fix a date not more than 50 years from the date of issuance of each series for the final maturity of such series.
Pending the actual issuance or delivery of bonds, a district may issue temporary or interim bonds, certificates, or receipts, of any denomination whatsoever, with or without coupon, and in such form as may be prescribed by the board, to be exchanged for definite bonds when ready for delivery.
The bonds shall be issued in such denominations as the board determines, except that no bonds shall be issued of a denomination less than one thousand dollars ($1,000) and shall be payable on the day and at the place or places fixed in the bond, and with interest at the rate specified therein, payable semiannually.
The board may at any time prior to the issuance and sale of any bonds provide for the call and redemption of any or all of the bonds on any interest payment date prior to their fixed maturity at not exceeding the par value and accrued interest plus a premium of not exceeding 5 percent upon the principal amount of the bonds, in which event the call price fixed by the board shall be set forth on the face of the bond. Notice of such redemption shall be published. If there is no newspaper of general circulation printed and published within the district, then the publication shall be made in a newspaper of general circulation printed and published within the county in which the district or any part thereof is situated. The first publication shall be at least 30 days prior to the date fixed for the redemption. After the date fixed for such redemption interest on the bonds thereafter shall cease.
The bonds shall be signed by the chairman of the board or by such officer of the district as the board shall by resolution authorize and designate for that purpose. They shall also be signed by the treasurer, and be countersigned by the auditor. The coupons of the bonds shall be numbered consecutively and be signed by the treasurer. All signatures and countersignatures, except one of the signatures or countersignatures on the bonds, may be printed, lithographed or engraved. If any officer whose signature or countersignature appears on the bonds or coupons ceases to be such officer before the delivery of the bonds to the purchaser, the signature or countersignature is nevertheless valid and sufficient for all purposes as if he had remained in office until the delivery of the bonds.
ARTICLE 3. Issue and Sale [70245. - 70246.]
The bonds may be issued and sold for not less than their par value, but otherwise as the board determines. Before selling any bonds, or any part thereof, the board shall give notice inviting sealed bids in such manner as the board may prescribe. If satisfactory bids are received, the bonds offered for sale shall be awarded to the highest responsible bidder. If no bids are received, or if the board determines that the bids received are not satisfactory as to price or responsibility of the bidders, the board may reject all bids received, if any, and either again give notice inviting bids or sell the bonds at private sale.
All premiums and accrued interest received on the sale of bonds shall be placed in the fund to be used for the payment of principal of and interest on the bonds. The remainder of the proceeds of the bonds shall be placed in the district treasury to the credit of the proper fund, and shall be used exclusively for the objects or purposes for which the bonds were voted; provided that when such objects and purposes have been accomplished any moneys remaining shall be transferred to the fund to be used for the payment of principal of and interest on the bonds, and that when all principal of and interest on the bonds shall have been paid, any balance of money then remaining shall be transferred to the general fund of the district.
ARTICLE 4. Status as Investments [70260. - 70261.]
All bonds including refunding bonds issued by a district are legal investments for all trust funds and for the funds of all insurance companies, banks, both commercial and savings, and trust companies, and for the State School Fund and for all sinking funds under the control of the State Treasurer. Whenever any money or funds may by law be invested in or loaned upon the security of bonds of cities, cities and counties, counties, or school districts, in the State, such money or funds may be invested in or loaned upon the security of the bonds of the district; and whenever bonds of cities, cities and counties, counties, or school districts by law may be used as security for the faithful performance or execution of any court or private trust or of any other act, bonds of the district may be so used.
All bonds of the district, to the same extent as bonds of any other municipality, are legal for use by any state or national bank or banks in the State as security for the deposit of funds of the State or of any county, city and county, city, municipality or other public or municipal corporation within the State.
ARTICLE 5. Validation [70263. - 70263.]
An action to determine the validity of bonds, including refunding bonds, may be brought pursuant to Chapter 9 (commencing with Section 860) of Title 10 of Part 2 of the Code of Civil Procedure.
ARTICLE 6. Revenue Bonds [70265. - 70266.]
As an alternative procedure for the raising of funds, the district may issue bonds, payable from revenues of any facility or enterprise to be acquired or constructed by the district, in the manner provided by the Revenue Bond Law of 1941 (Chapter 6 (commencing with Section 54300) of Part 1 of Division 2 of Title 5 of the Government Code), all of the provisions of which are applicable to the district.
The district is a local agency within the meaning of the Revenue Bond Law of 1941 (Chapter 6 (commencing with Section 54300) of Part 1 of Division 2 of Title 5 of the Government Code). The term “enterprise” as used in the Revenue Bond Law of 1941 shall, for all purposes of this part, include transit facilities and any and all parts thereof and all additions, extensions and improvements thereto and all other facilities authorized to be acquired, constructed or completed by the district. A district may issue revenue bonds under the Revenue Bond Law of 1941, for any one or more facilities or enterprises authorized to be acquired, constructed, or completed by a district or, in the alternative, may issue revenue bonds under the Revenue Bond Law of 1941, for the acquisition, construction and completion of any one of such facilities. Nothing in this article shall prevent the district from availing itself of, or making use of, any procedure provided in this part for the issuance of bonds of any type or character for any of the facilities or works authorized hereunder, and all proceedings may be carried on simultaneously or, in the alternative, as the directors may determine.
CHAPTER 8. Annexation [70270. - 70277.]
Territory within Marin County may be annexed to the district in the manner provided in this chapter.
Whenever the board finds and determines that additional territory will be benefited by annexation to the district, it shall pass a resolution to that effect.
The resolution shall be passed by a vote of two-thirds of the members of the board.
The resolution shall:
Describe the boundaries of the territory proposed to be annexed.
Designate the proposed annexation by an appropriate name.
Declare that the area to be annexed to the district will be benefited by such annexation.
Name the time and place for the hearing of objections by any person interested in the proposed annexation.
The resolution, together with the names of the members of the board, voting for and against it shall be published pursuant to Section 6066 of the Government Code in a newspaper published in the territory proposed to be annexed, or if there is no such paper, then in some newspaper of general circulation, circulated in such territory.
On the day fixed for hearing or any day to which the hearing is adjourned, the board shall hear and consider any objections presented to the annexation of the territory. After the hearing of objections, if it shall be determined by a vote of two-thirds of all the members of the board that the territory proposed to be annexed will be benefited by such annexation, the board shall proceed to fix and determine the boundaries of the territory to be annexed to the district, provided, however, that if there is filed with the clerk of the board prior to the close of said hearing, written protests against said annexation signed by fifty percent (50%) or more of the registered voters within the area proposed to be annexed, then said annexation proceedings shall be terminated by board action and the board shall not within six months after said termination adopt a resolution pursuant to Section 70271 applicable to the same or substantially the same area involved in the prior terminated proceeding.
After making all necessary and proper changes in the boundaries, by a resolution passed by a vote of two-thirds of the members, the board shall order the annexation of the territory so described. The resolution, together with the names of the members of the board voting for and against the same shall be spread upon the minutes of the board.
Whenever any territory is annexed to the district it shall thereupon become a part of the district subject to all the liabilities and entitled to all the benefits of the district.
CHAPTER 9. Dissolution [80000. - 80007.]
The board may call an election any time for the purpose of submitting to the voters of the district the question of whether the district will be dissolved. Upon the filing with the clerk of the district of a petition signed by voters within the district equal in number to at least twenty-five percent (25%) of the total vote cast within the district at the last general statewide election asking that the question of dissolution of the district be submitted to the voters of the district, the board shall call such an election.
The election for the purpose of submitting to the voters of the district the question of whether or not the district shall be dissolved shall be held within 60 days next succeeding the date on which the petition is filed.
Notice of any election for dissolution, whether called because of the filing of a petition or ordered by the board without petition, shall be published. The date fixed for the election shall not be less than 30 days from the date of the first publication of the notice.
The ballots for the election shall contain substantially the instructions required to be printed on ballots for use at general state and county elections and in addition the following:
The board shall canvass the vote. If a majority of the votes favor dissolution, the board shall by resolution dissolve the district.
The board shall file a certified copy of the resolution with the Secretary of State and for record in the office of the county recorder.
Upon dissolution the right, title, and interest to property owned or controlled by the district situated within the limits of any city vests absolutely in the city. If such property is situated outside the limits of a city, it vests in the county in which it is situated.
The board of supervisors is, ex officio, the governing body of the dissolved district. It may levy taxes and assessments and perform other acts necessary to wind up the district affairs and to raise money for the payment of outstanding indebtedness.
CHAPTER 10. Consolidation with Other Districts [80010. - 80019.]
The district may be consolidated with any other transit district organized and operating pursuant to Part 2 (commencing with Section 28500) of this division, in the manner provided in this chapter.
Whenever the board finds and determines that:
Another transit district is willing to annex the territory comprising the district;
The annexing district has adequate facilities for and is able to supply transit service to the district in a manner equal to or superior to that presently rendered by the district;
Annexation will not result in assumption of financial obligations by the taxpayers of district disproportionate to the services which they will receive; the board shall thereafter negotiate an agreement with the annexing district specifying the terms and conditions of annexation and such other matters as are necessary and incidental thereto.
The board shall thereafter, by resolution setting forth the terms and conditions of the proposed contract at length, declare its intention to cause the agreement to be approved and effect consolidation of district with such other transit district.
The resolution, together with a notice fixing the time and place for hearing thereon, shall be published once in a newspaper of general circulation published in the district. The time fixed for hearing shall not be less than 30 nor more than 60 days from the date of publication of such notice.
At the hearing any interested person may file with the board written objections to the approval of the terms and conditions of the proposed contract or the consolidation, or both the proposed contract and the consolidation.
Upon the hearing, the board shall determine whether or not the terms and conditions of the contract will be approved and the consolidation effected, and shall hear and determine all objections thereto.
Any hearing on the agreement and consolidation may be adjourned from time to time by the board, not exceeding 30 days in all, without further notice other than an order entered upon the minutes of the meeting fixing the time and place of adjournment.
If no protests are filed, or if the protests filed are overruled and denied by the board, the board shall thereupon by resolution finally approve the terms and conditions of the agreement and proceed with the consolidation.
Thereafter such consolidation shall be effected by such other district in the manner provided for annexation of counties in Chapter 9 (commencing with Section 29500), Part 2 of this division.
Upon the completion of such consolidation procedure, the Marin County Transit District shall be deemed to be dissolved. Thereafter, all property and assets of district which are not subject to the negotiated contract pertaining to consolidation shall be distributed to the County of Marin.
PART 8. SAN DIEGO COUNTY TRANSIT DISTRICT [90000. - 93017.]
CHAPTER 1. General Provisions [90000. - 90025.]
ARTICLE 1. Definitions [90000. - 90006.]
This part shall be known and cited as the “San Diego County Transit District Act of 1965.”
Unless the context otherwise requires, the provisions of this article govern the construction of this part.
“District” means the San Diego County Transit District.
“Board” means the board of directors of the district.
“Voter” means any elector who is registered under the Elections Code.
“Transit” means the transportation of passengers only and their incidental baggage by means other than by chartered bus, sightseeing bus, or any other motor vehicle not on an individual passenger fare-paying basis. Nothing in this section shall be construed to prohibit the district from leasing its buses to public agencies or to private certified public carriers or to prohibit the district from providing schoolbus service for the transportation of pupils between their homes and schools.
“Transit works” or “transit facilities” means all real and personal property, equipment, rights, or interests owned or to be acquired by the district for transit service.
ARTICLE 2. General Provisions [90020. - 90025.]
It is hereby declared to be the policy of the State of California to develop transit system districts in the various metropolitan areas within the state for the benefit of the people. A necessity exists within San Diego County for such a system. Because there is no general law under which this district could perform this distinct function, only a specially created district can operate effectively in the San Diego metropolitan area. Because of the unique problem presented by that metropolitan area, the adoption of a special act and the creation of a special district is required.
The San Diego County Transit District may be created as provided in this part and when so created may exercise the powers herein granted.
Except as otherwise provided in this part, elections shall be held and conducted and the result ascertained, determined, and declared in all respects as nearly as practicable in conformity with the general elections laws of the state.
Except as otherwise provided in this part, all ordinances and notices which are required to be published shall be published within the district pursuant to Section 6066 of the Government Code.
Whenever the signature of any officer or employee of a district or of any member of the retirement board or of any officer or employee of the retirement system is authorized or required under the provisions of this part, except in the single instance provided in Section 90623, the signature may be made by the use of a plate bearing facsimiles of such signatures.
The district is hereby designated a rapid transit district and the transit facilities and services the district is authorized to acquire, own, operate, control, or use are designated a rapid transit system, for the purposes of Part 15 (commencing with Section 35001) and Part 16 (commencing with Section 36000) of Division 2 of the Revenue and Taxation Code.
CHAPTER 2. Formation of District [90050. - 90120.]
ARTICLE 1. General Provisions [90050. - 90050.]
The area to be embraced in the district shall include all of the corporate area of each of the Cities of San Diego, Chula Vista, Coronado, National City, La Mesa, El Cajon, and Imperial Beach which establish the district as provided in this act, and any unincorporated territory in the County of San Diego contiguous thereto and being served by the San Diego Transit System, which is included in the district by the board of supervisors of the county as provided in this part.
This area shall be subdivided for the purpose of formation into two sections comprising (1) the City of San Diego and (2) the Cities of Coronado, Imperial Beach, Chula Vista, National City, El Cajon, and La Mesa and any unincorporated territories in the County of San Diego contiguous thereto and being served by the San Diego Transit System which is included in the district by the board of supervisors of the county as provided in this part.
ARTICLE 2. Election [90070. - 90078.]
The Board of Supervisors of San Diego County shall call an election in the area to be included within the district on the question of the formation of the district if either of the two conditions specified below is met:
A petition calling for the formation of the district is filed with the board of supervisors from each of the seven cities specified in Section 90050. Each of the petitions from the seven respective cities shall be signed by a number of signers equal to at least five percent (5%) of the voters registered for the last municipal election in each particular city. A petition may be on separate papers, but each paper shall contain the affidavit of the person who circulated it, certifying that each name signed thereto is a true signature of the person whose name it purports to be.
A resolution of consent calling for the formation of the district is filed with the board of supervisors from each of the city councils of the seven cities specified in Section 90050; provided, that the requirements of this section shall be deemed to have been met if a combination of petitions and resolutions of consent have been filed with the board of supervisors, so long as each of the seven cities specified in Section 90050, either through a petition or by a vote of the city council, has authorized the calling of an election for the formation of the district.
Each signer of a petition within a particular city shall be a registered voter and resident of that city.
Upon receipt of the resolutions or petitions, or sufficient combination of both, the board of supervisors shall call a hearing thereon not less than 77 days nor more than 91 days following the receipt of all of the required resolutions or petitions, or both. The board of supervisors shall publish notice of said hearing in any newspaper of general circulation published within the proposed district in accordance with Section 6066 of the Government Code. The notice shall state the name and nature of the proposed district, that all petitions and resolutions may be inspected at the office of the clerk of said board of supervisors, that the proposed district shall include the seven cities specified in Section 90050, the boundaries of any unincorporated territory proposed for inclusion, the time and place for the hearing, and that all interested persons shall be given an opportunity to express their views.
At any time within 30 days following the receipt by the board of supervisors of petitions or resolutions, or both, requiring the calling of an election pursuant to Section 90070, the board of supervisors may adopt a resolution of intention to include within the proposed San Diego County Transit District any unincorporated territory eligible for inclusion in the district as provided in Section 90050, and shall adopt such resolution of intention as to any such unincorporated territory upon receipt within such 30-day period of a petition signed by a number of signers equal to at least 5 percent of the voters registered for the last general election within any such territory requesting its inclusion in the proposed district and describing its boundaries. The board of supervisors by its resolution and registered voters by their petitions may propose the inclusion of such unincorporated territory in separate areas which are not themselves contiguous to each other. The board of supervisors shall, upon its adoption, refer such resolution of intention to the San Diego County Local Agency Formation Commission, which shall report to the board of supervisors within 30 days following receipt of the referral.
At the hearing, the board of supervisors shall have the power to exclude any unincorporated territory which, in its determination, would not receive reasonable benefit from inclusion in the district. Any landowner within any unincorporated territory proposed for inclusion may by written application request that the board of supervisors consider the exclusion of his property as described in his application from the proposed district. At the conclusion of the hearing the board of supervisors shall determine the boundaries of any unincorporated territory to be included within the proposed district and shall adopt its order calling the election on the question of the forming of the proposed district, which election shall be consolidated with the next succeeding primary or general election occurring not sooner than 75 days following the conclusion of the hearing.
The election shall be called, noticed, held, and conducted, election officers appointed, voting precincts designated, ballots printed, polls opened and closed, ballots counted and returned, returns canvassed, results declared, oaths of office administered, and all other proceedings incidental to and connected with the election shall be regulated and done, as nearly as may be practicable, in accordance with the provisions of law regulating municipal elections in general law cities.
For the purposes of the election, the terms “board of trustees” and “city clerk,” respectively, as used in the Elections Code provisions respecting the conduct of elections in general law cities, shall mean the county board of supervisors and the registrar of voters, respectively, for the purpose of the election held under this act.
An election called pursuant to the provisions of this act may be consolidated with any other election pursuant to Part 3 (commencing with Section 10400) of Division 10 of the Elections Code.
The count of the votes of the election shall be conducted in two parts (see Section 90050). One part shall consist of the votes cast in the City of San Diego. The second part shall consist of the votes cast in the Cities of Coronado, Imperial Beach, Chula Vista, National City, El Cajon, and La Mesa and outside territory included by the county board of supervisors, if any, at the time of election.
If from the canvass it appears and the board of supervisors finds that a majority of the votes cast in the City of San Diego and a majority of the votes cast in the other section specified in Section 90050 were cast in favor of the formation of the district, it shall enter that fact upon its minutes together with a description of the boundaries of the district and enter its order declaring the district duly formed and existing in the county.
ARTICLE 3. Establishment of the District [90100. - 90100.]
If a majority of the electors voting on the proposition in the City of San Diego and a majority of the electors in the other section specified in Section 90050 vote in favor of the creation and establishment of the district, the board of supervisors shall cause a certified copy of the order declaring the result of the election to be filed in the office of the Secretary of State, from and after which the establishment of the district shall be deemed complete in the City of San Diego and the other section specified in Section 90050.
ARTICLE 4. Contest of Incorporation [90120. - 90120.]
No informality in any proceeding or in the conduct of the election, not substantially affecting adversely the legal rights of any citizen, shall be held to invalidate the incorporation of the district. Any proceedings wherein the validity of incorporation is denied shall be commenced within three months from the date of filing the order declaring the result of the election with the Secretary of State, otherwise the incorporation and the legal existence of the district shall be held to be valid and in every respect legal and incontestable.
CHAPTER 3. Internal Organization of District [90170. - 90300.]
ARTICLE 1. Government [90170. - 90171.]
The government of the district shall be vested in a board of directors elected concurrent with the district’s formation. If no unincorporated area of the county is included within the district, the City of San Diego shall elect seven directors at large. If any unincorporated area of the county is included within the district, the City of San Diego shall elect eight directors at large. Each of the incorporated cities within the remaining section as specified in Section 90050 and the unincorporated area of the county, if any, shall elect one director. In the event of a tie, the directors involved shall determine by lot which shall be seated.
Whenever any additional member is elected to the board of directors as a result of any annexation to the district, the City of San Diego shall be entitled to seat an additional member on the board of directors. The City Council of the City of San Diego shall appoint any initial additional member to which the city becomes entitled and such member shall serve until a successor is elected at the next succeeding election of directors within the City of San Diego and qualifies.
The directors elected shall be residents of the respective city they represent at the time of their election and during the term of their office. Any director elected in the unincorporated area shall be a resident of that area at the time of his election and during the term of his office.
ARTICLE 2. Terms of Office [90190. - 90194.]
The term of each director shall be for four years, except as provided in this article.
Any vacancy, including any caused by death or resignation of any member, shall be filled by appointment of the board of directors within 60 days of date of vacancy. Such appointment shall be made within the jurisdiction in which the vacancy occurred.
The person to fill any vacancy on the board shall serve temporarily to fill the unexpired term or until a successor is regularly elected at the next election within that jurisdiction whichever occurs first.
The first members of the board of directors elected after the formation of the district shall so classify themselves by lot that one more than one-half of the directors shall serve for four years, and the remainder of the directors for two years. Thereafter the term of office of each director shall be four years.
Every director is subject to recall by voters of the district, in accordance with the recall provisions of the general laws of the state applicable to county officers.
ARTICLE 3. Powers and Duties of Directors [90210. - 90219.]
The oath of office of directors shall be taken, subscribed, and filed with the secretary of the district at any time after the director has been elected, but not later than 15 days after the commencement of his term of office. No other filing is required.
The board shall choose one of its members president, and another vice president, who shall be authorized to act for the president during his absence or disability and shall provide for the time and place of holding its meetings, which shall be held at least once each month.
The board is the legislative body of the district and determines all questions of policy.
All matters and things necessary for the proper administration of the affairs of the district which are not provided for in this act shall be provided for by the board.
The board shall supervise and regulate every transit facility owned and operated by the district, including the fixing of rates, rentals, charges, and classifications, and the making and enforcement of rules, regulations, contracts, practices, and schedules, for or in connection with any transit facility owned or controlled by the district.
The board may adopt a personnel system for the purpose of recruiting and maintaining an effective working force with good morale. The board shall by resolution determine and create such number and character of positions as are necessary properly to carry on the functions of the district and shall establish an appropriate salary, salary range, or wage for each position so created. The board may by resolution abolish any such position. Except as otherwise provided, appointments to such positions shall be made by the general manager.
The board may from time to time contract for or employ any professional service required by the district or for the performance of work or service which cannot satisfactorily be performed by the regular employees of the district.
The board shall have an annual audit made of all books and accounts of the district by a certified public accountant or public accountant.
The board may provide by resolution, under such terms and conditions as it sees fit, for the payment of demands against the district without prior specific approval thereof by the board if the demand is for a purpose for which an expenditure has been previously approved by the board and in an amount no greater than the amount so authorized, and if the demand is approved by the general manager.
To facilitate the business of the district, the board may provide for the creation and administration of such funds as the needs of the district may require. The funds shall be disbursed in accordance with rules established by the board and all payments for any fund shall be reported to the board.
ARTICLE 4. Meetings and Legislation [90240. - 90245.]
All meetings of the board shall be conducted in a manner prescribed by the Ralph M. Brown Act, Chapter 9 (commencing with Section 54950), Part 1, Division 2, Title 5 of the Government Code.
A majority of the board constitutes a quorum for the transaction of business.
The board shall establish rules for its proceedings and may provide by ordinance or resolution that each member shall receive for each attendance at the meetings of the board and for each day any member is engaged in authorized district business other than attendance at meetings of the board the sum of fifty dollars ($50) but not to exceed two hundred dollars ($200) in any calendar month and shall be allowed such necessary traveling and personal expenses incurred in the performance of his duties as authorized by the board.
The acts of the board shall be expressed by motion, resolution, or ordinance. No ordinance shall be passed by the board on the day of its introduction, nor within seven days thereafter, nor at any time other than a regular or adjourned regular meeting. No ordinance, resolution, or motion shall have any validity or effect unless passed by the affirmative votes of a majority of the directors.
All ordinances shall be published after passage.
The enacting clause of all ordinances shall be as follows: “Be it ordained by the Board of Directors of the San Diego County Transit District.” All ordinances shall be signed by the president or vice president of the board and attested by the secretary.
ARTICLE 5. Other Officers [90260. - 90300.]
The board shall appoint and fix the salary of a general manager, who shall have full charge of the acquisition, construction, maintenance and operation of the facilities of the district and also of the administration of the business affairs of the district.
All other things being equal, the board shall appoint as general manager some person who has had experience in the construction or management of transit facilities.
The general manager need not be a resident of this state at the time of his appointment.
The general manager shall hold office for an indefinite term and may be removed by the board only upon the adoption of a resolution by the affirmative vote of not less than a majority of the board. Before the general manager may be removed, he shall, if he demands it, be given a written statement of the reasons alleged for his removal and he shall have the right to be publicly heard thereon at a meeting of the board prior to the final vote on the resolution providing for his removal, but pending and during such hearing the board may suspend him from office. The board may not reduce the salary of the general manager below the amount fixed at the time of his original appointment except upon the adoption of a resolution by a like vote and after a like opportunity to be heard. The action of the board in suspending or removing the general manager or reducing his salary, if approved by a majority of the membership of the board is final.
Notwithstanding this article, until such time as the district has operated, controlled, or used facilities or parts of facilities for providing the inhabitants within the boundaries of the district with transit service for a period of six months, the board may, but is not required to, appoint a general manager. A general manager appointed during such time holds office at the pleasure of the majority of the board.
The board shall appoint a secretary and an attorney, who shall hold office during the pleasure of the board.
The attorney shall be admitted to practice law in the Supreme Court of the state, and shall have been actively engaged in the practice of his profession for not less than five years next preceding his appointment.
The secretary and such assistants as the board may determine, and shall have the power to administer all oaths or affirmations required by this act, including the oath of office.
The board may consolidate any of the district offices in one person.
The oath of all appointive officers of the district shall be taken, subscribed, and filed with the secretary of the district at any time after the officer has notice of his appointment but not later than 15 days after the commencement of his term of office. No other filing is required.
Each appointive officer shall give such bond and in such amount as the board may require.
Subject to the control of the board, the powers and duties of the general manager are:
To have full charge of the acquisition, construction, maintenance, and operation of the facilities of the district.
To have full charge of the administration of the business affairs of the district.
To see that all ordinances of the district are enforced.
To administer the personnel system and collective bargaining agreements adopted by the board and except for officers appointed by the board to appoint, discipline or remove all officers and employees subject to the rules and regulations adopted by the board and the applicable provisions of this part or the terms and conditions contained in any applicable collective bargaining agreement.
To attend all meetings of the board and submit a general report of the affairs of the district.
To keep the board advised as to the needs of the district.
To prepare or cause to be prepared all plans and specifications for the construction of the works of the district.
To devote his entire time to the business of the district.
To perform such other and additional duties as the board may require.
The general manager shall within 90 days from the end of each fiscal year cause to be published a financial report showing the result of the operations for the preceding fiscal year and the financial status of the district on the last day thereof. The publication shall be made in the manner provided in this division for the publication of ordinances and notices generally.
The attorney shall take charge of all suits and other legal matters to which the district is a party or in which it is legally interested. He shall give his advice or opinion in writing whenever required by the board. He shall be the legal advisor of the general manager and other district officers and shall prepare or approve the forms of all ordinances, resolutions, contracts, bonds, and other legal documents connected with the business of the district. He shall perform such other and additional services as the board may require.
The general manager shall provide for the custody of the funds of the district and the keeping of accounts of all receipts and disbursements. Payments shall be made only upon warrants duly and regularly signed by the president or vice president of the board, or other person authorized by the board so to do, and by the general manager or secretary.
With the consent of the board, the general manager may:
Authorize the trust department of any state or national bank in this state or a trust company authorized to act as such in this state, to receive as his agent deposits of any securities acquired by the district.
Place and maintain for safekeeping as a trust deposit with the trust department of any state or national banks in this state, or a trust company authorized to act as such in this state, any securities owned by the district.
The bank or trust company selected shall have a total paid-in capital of at least one million dollars ($1,000,000). The general manager shall take from the trust department or trust company a receipt for the securities, and neither the general manager nor the district is responsible for the custody and safe return of the securities until they are withdrawn from the trust department or trust company by the general manager. Any trust department or trust company to which securities are delivered, either as agent or depository for the general manager, shall make such disposition of the securities as the general manager directs and is responsible only for strict compliance with written instructions given to it by the general manager. All such securities are at all times subject to the order of the general manager.
Employees have the right to self-organize, to form, join, or assist labor organizations, to bargain collectively through representatives of their own choosing, and to engage in other concerted activities for the purpose of collective bargaining or other mutual aid or protection. It is declared to be in the public interest that the district not express any preference for one union over another.
Notwithstanding any other provision of this act, if a majority of the employees employed by a district in a unit appropriate for collective bargaining indicate a desire to be represented by a labor organization, then the district, after determining pursuant to subdivision (f) that the labor organization represents the employees in the appropriate unit, shall enter into a written contract with the accredited representative of those employees governing wages, salaries, hours, and working conditions.
If a dispute arises over wages, salaries, hours, or working conditions that is not resolved by negotiations conducted in good faith between the district and the labor organization, then upon the request of either party, the district and the labor organization may submit the dispute to an arbitration board. The decision of a majority of the arbitration board shall be final.
The arbitration board shall be composed of two representatives of the district, two representatives of the labor organization, and a fifth member to be agreed upon by the representatives of the district and labor organization.
If the representatives of the district and labor organization are unable to agree on the fifth member, then the names of five persons experienced in labor arbitration shall be obtained from the California State Mediation and Conciliation Service. The labor organization and the district shall, alternately, strike a name from the list supplied by the California State Mediation and Conciliation Service. The labor organization and the district shall determine by lot who shall first strike a name from the list. After the labor organization and the district have stricken four names, the name remaining shall be designated as the arbitrator. The decision of a majority of the arbitration board shall be final and binding upon the parties.
The expenses of arbitration shall be borne equally by the parties. Each party shall bear the party’s own costs.
If the board and the representatives of the employees do not agree to submit the dispute to an arbitration board as provided in subdivision (a), either party may notify the California State Mediation and Conciliation Service that a dispute exists and that there is no agreement to arbitrate. The California State Mediation and Conciliation Service shall determine whether or not the dispute can be resolved by the parties and, if not, the issues that are the subject of the dispute. After making its determination, the service shall certify its findings to the Governor who shall, within 10 days of receipt of certification, appoint a factfinding commission consisting of three persons. The factfinding commission shall immediately convene and investigate the issues involved in the dispute. The commission shall report to the Governor within 30 days of the date of its creation.
After the creation of the commission and for 30 days after the date the commission made its report to the Governor, the parties to the controversy shall not make any change, except by mutual agreement, in the conditions out of which the dispute arose. Service to the public shall be provided during that time.
A contract or agreement shall not be made, or assumed, with any labor organization, association, group, or individual that denies membership to, or in any manner discriminates against, any employee on any basis listed in subdivision (a) of Section 12940 of the Government Code, as those bases are defined in Sections 12926 and 12926.1 of the Government Code. However, the organization may preclude from membership any individual who advocates the overthrow of the government by force or violence.
The district shall not discriminate with regard to employment against any person on any basis listed in subdivision (a) of Section 12940 of the Government Code, as those bases are defined in Sections 12926 and 12926.1 of the Government Code, except as otherwise provided in Section 12940 of the Government Code.
Any questions regarding whether a labor organization represents a majority of employees or whether the proposed unit is or is not appropriate, shall be submitted to the California State Mediation and Conciliation Service for disposition. The California State Mediation and Conciliation Service shall promptly hold a public hearing after due notice to all interested parties to determine the unit appropriate for the purposes of collective bargaining. In making that determination and in establishing rules and regulations governing petitions and the conduct of hearings and elections, the California State Mediation and Conciliation Service shall be guided by relevant federal law and administrative practice, developed under the Labor-Management Relations Act of 1947 (29 U.S.C. Sec. 141 et seq.).
The California State Mediation and Conciliation Service shall provide for an election to determine the question of representation and shall certify the results to the parties. A certification of a labor organization to represent or act for the employees in any collective bargaining unit shall not be subject to challenge on the grounds that a new substantial question of representation within the collective bargaining unit exists until the lapse of one year from the date of certification or the expiration of any collective bargaining agreement, whichever is later. However, no collective bargaining agreement shall be construed to be a bar to representation proceedings for a period of more than two years.
If the district acquires existing facilities from a publicly or privately owned public utility, either in proceedings by eminent domain or otherwise, the district shall assume and observe all existing labor contracts.
To the extent necessary for operation of facilities, all of the employees of the acquired public utility whose duties pertain to the facilities acquired shall be appointed to comparable positions in the district without examination, subject to all the rights and benefits of this act. Those employees shall be given sick leave, seniority, vacation, and pension credits in accordance with the records and labor agreements of the acquired public utility.
Members and beneficiaries of any pension or retirement system, or other benefits established by the public utility, shall continue to have the rights, privileges, benefits, obligations, and status with respect to the established system. No employee of any acquired public utility may be subject to a reduction in wages, seniority, pension, vacation, or other benefits as a result of the acquisition.
The district may extend the benefits of this section to officers or supervisory employees of the acquired utility.
The district shall not do any of the following:
Acquire any existing system or part of an existing system, whether by purchase, lease, condemnation, or otherwise.
Dispose of or lease any transit system or part of the transit system.
Merge, consolidate, or coordinate any transit system or part of the transit system.
Reduce or limit the lines or service of any existing system or of the district’s system unless the district has first made adequate provision for any employees who are or may be displaced. The terms and conditions of that provision shall be a proper subject of collective bargaining.
Notwithstanding any provision of the Government Code, the district may make deductions from the wages and salaries of its employees who authorize the deductions for the following purposes:
The obligation of the district to bargain in good faith with a duly designated or certified labor organization and to execute a written collective bargaining agreement with that labor organization covering the wages, hours, and working conditions of the employees represented by that labor organization in an appropriate unit, and to comply with the terms of the collective bargaining agreement, shall not be limited or restricted by any provision of law. The obligation of the district to bargain collectively shall extend to all subjects of collective bargaining that are or may be proper subjects of collective bargaining with a private employer, including retroactive provisions.
Notwithstanding any other provision of law, the district shall make deductions from the wages and salaries of its employees, upon receipt of authorization to make those deductions, for the payment of union dues, fees, or assessments, for the payment of contributions pursuant to any health and welfare plan or pension plan, or for any other purpose for which employees of any private employer may authorize deductions, where those deductions are pursuant to a collective bargaining agreement with a duly designated or certified labor organization.
The district may provide for a retirement system, provided that the adoption, terms, and conditions of any retirement system covering employees of the district represented by a labor organization in accordance with this section shall be pursuant to a collective bargaining agreement between the labor organization and the district.
The district shall take any steps that may be necessary to obtain coverage for the district and its employees under the workers’ compensation (Division 4 (commencing with Section 3200) and Division 4.5 (commencing with Section 6100) of the Labor Code), unemployment compensation disability (Part 2 (commencing with Section 2691) of Division 1 of the Unemployment Insurance Code), and unemployment insurance (Part 1 (commencing with Section 100) of Division 1 of the Unemployment Insurance Code) laws of the State of California.
CHAPTER 5. Retirement System [90350. - 90351.]
The district is empowered to contract with the State Employees’ Retirement System and may provide retirement and disability benefits for employees under the State Employees’ Retirement System pursuant to its rules and regulations.
Whenever the district acquires existing facilities from a publicly or privately owned public utility, either in proceedings in eminent domain or otherwise, that has a pension plan in operation, members and beneficiaries of such pension plan shall continue to have the rights, privileges, benefits, obligations and status with respect to such established system.
Whenever any such facilities are acquired by the district, the board shall consider and take into account the outstanding obligations and liabilities of the publicly or privately owned public utility by reason of such pension plan and shall negotiate an allowance in the purchase price of such utility for the assumption of such obligations and liabilities when acquiring the facilities.
CHAPTER 6. Powers and Functions of District [90400. - 90570.]
ARTICLE 1. Corporate Power [90400. - 90402.]
The district has perpetual succession and may adopt a seal and alter it at pleasure.
The district may sue and be sued, except as otherwise provided by law, in all actions and proceedings, in all courts and tribunals of competent jurisdiction.
The district may exercise the right of eminent domain to take any property necessary or convenient to the exercise of the powers granted in this act. The district, in exercising such power shall, in addition to the damage for the taking, injury, or destruction of property, also pay the cost of removal, reconstruction, or relocation of any structure, railways, mains, pipes, conduits, cables, or poles of any public utility which is required to be moved to a new location.
No such taking or acquisition by the district which would involve the abandonment, removal, relocation or use of the property of a railroad corporation, as defined in Section 230 of this code, shall be permitted, unless the Public Utilities Commission, after hearing, shall find and determine that the public interest and necessity require the abandonment, removal, relocation or use of such property and that such taking or acquisition will not unreasonably impair the ability of the railroad corporation involved to provide safe, adequate, economical and efficient service.
ARTICLE 2. Contracts [90420. - 90421.]
The district may make contracts and enter into stipulations of any nature whatsoever, either in connection with eminent domain proceedings or otherwise, including, without limiting the generality of the foregoing, contracts and stipulations to indemnify and save harmless, to employ labor, and to do all acts necessary and convenient for the full exercise of the powers granted in this act.
The district further shall be empowered to furnish contractual service outside of the district’s boundaries.
Neither the general manager nor any director of the district shall in any manner be interested, directly or indirectly, in any contract awarded or to be awarded by the board, or in the profits to be derived therefrom. Any violation of this provision is a misdemeanor, and conviction shall work a forfeiture of office. This section has no application to contracts awarded to corporations in which such officer owns less than 1 percent of the entire capital stock.
ARTICLE 4. Property [90460. - 90461.]
The district may take by grant, purchase, gift, devise, or lease, or condemn in proceedings under eminent domain, or otherwise acquire, and hold and enjoy, real and personal property of every kind within or without the district necessary to the full or convenient exercise of its powers. The board may lease, mortgage, sell, or otherwise dispose of any real or personal property within or without the district when in its judgment it is for the best interests of the district so to do.
Whenever the board by resolution determines that any record, map, book or paper in the possession of the district or any officer or employee thereof is of no further value to the district, the board may authorize its sale, destruction, or other disposition.
ARTICLE 5. Transit Facilities and Service [90480. - 90490.]
The district may acquire, construct, own, operate, control or use rights-of-way, rail lines, buslines, stations, platforms, switches, yards, terminals, and any and all such other facilities necessary or convenient for transit service within or partly without the district, underground, upon, or above the ground and under, upon, or over public streets or other public ways or waterways, together with all physical structures necessary or convenient for the access of persons and vehicles thereto, and may acquire any interest in or rights to the joint use of any or all of the foregoing; provided, that installations in state freeways shall be subject to the approval of the State Department of Public Works and installations in other state highways shall be subject to Article 2 (commencing with Section 670), Chapter 3, Division 1 of the Streets and Highways Code.
The negotiated purchase price of any existing facilities which are acquired by the district shall not exceed the fair market value of the tangible real and personal property which is acquired.
The district may without limitation by any other provisions of this part requiring approval of indebtedness, accept contributions of money, rights-of-way, labor, materials, and any other property for the acquisition, construction, maintenance, and operation of transit facilities, and may without limitation by any other provisions of this part enter into any contracts and cooperation with and accept cooperation from the federal government, state, or any department, instrumentality, or agency thereof, or any public agency in the acquisition, construction, maintenance, and operation of, and in financing the acquisition, construction, maintenance, and operation of, any such transit facilities.
The district may plan for, establish, construct, finance and operate rapid transit facilities and service within or without the district’s boundaries, including making whatever contracts are necessary for the accomplishment of this purpose.
The district may construct and operate or acquire and operate works and facilities in, under, upon, over, across, or along any street or public highway or any stream, bay or watercourse, or over any of the lands which are the property of the state, to the same extent that such rights and privileges appertaining thereto are granted to municipalities within the state. The district shall not use any street or public highway in a manner to unnecessarily impair its usefulness.
The district may enter into agreements for the joint use of any property and rights by the district and any city, public agency or public utility operating transit facilities; may enter into agreements with any city, public agency or public utility operating any transit facilities, either wholly or partially within, or without, the district, for the joint use of any property of the district or of such city, public agency or public utility, or the establishment of through routes, joint fares, transfer of passengers or pooling arrangements.
The rates and charges for service furnished pursuant to this act shall be fixed by the board and shall be reasonable.
The board of supervisors or the city council of a municipality having territory located within the district may file a request for a hearing before the district board as to the reasonableness of any rates or charges fixed by the district and as to any proposal for fixing the location of facilities by the district. The request shall be in writing and shall state the subject matter on which a hearing is desired.
Upon the filing of a request for hearing as provided in Section 90487 the district board shall fix the time and place for hearing. The time fixed shall not be less than 15 days nor more than 60 days from the date such request is filed. Notice of such hearing shall be given to the county or city requesting such hearing and shall be published by the board.
At the time fixed for any hearing before the board any board of supervisors or city council eligible to file a request for hearing, not a party to the original request for hearing, may intervene and shall be entitled to be heard and to introduce evidence.
Within 30 days after submission of the case, the board shall render its decision and its decision shall be final.
ARTICLE 6. Indebtedness [90500. - 90508.]
The district may borrow money and incur indebtedness, and may issue bonds or other evidences of indebtedness. No indebtedness shall be incurred exceeding the ordinary annual income and revenue of the district without the approval of 60 percent of the voters voting on the proposition to incur such indebtedness, except that a further vote of the voters is not required for any indebtedness incurred within the purposes and not exceeding the available amount of any previously authorized bond issue, and as to such indebtedness the proceeds of any of the bonds unexpended in the treasury of the district, or the par value of any of the bonds which are unsold shall be deemed a part of the ordinary annual income and revenue of the district.
The district may borrow money for the purpose of defraying the expenses of the district lawfully incurred after the commencement of the fiscal year, but prior to the time moneys from the tax levy for the fiscal year are received by the district, in a sum which shall not exceed five cents ($0.05) on each one hundred dollars ($100) of assessed valuation of taxable property in the district at the time the moneys are borrowed, and may evidence such borrowing by notes bearing interest at a rate not to exceed six (6) percent per annum. The notes shall be payable from the tax levy from the then current fiscal year, which levy shall contain a sum sufficient to provide for the payment of the notes and the interest thereon. The form of said notes and the proceedings relating to their issuance and sale, will be governed by the applicable provisions contained in Article 7 (commencing with Section 53820) of Chapter 4 of Part 1 of Division 2 of Title 5 of the Government Code.
The board of directors of the district may, within a period of two years from and after the formation of the district, pursuant to a resolution adopted by it for the purpose, borrow money on certificates of indebtedness, promissory notes, or other evidences of indebtedness, in anticipation of the estimated tax revenue for the following fiscal year, to be repaid within four years from the date of borrowing with interest at a rate not to exceed 6 percent per annum, in order to enable the district to meet all of its necessary initial expenses of organization, construction, acquisition, maintenance, and operation. The total amount of money borrowed and indebtedness incurred under this section during this two-year period shall not exceed 50 percent of the total amount of estimated tax revenue as estimated by the county auditor of the county in which the district lies for the following fiscal year.
The form of said notes and the proceedings relating to their issuance and sale, will be governed by the applicable provisions contained in Article 7 (commencing with Section 53820) of Chapter 4 of Part 1 of Division 2 of Title 5 of the Government Code.
The district shall not incur an indebtedness for public works which in the aggregate exceeds 15 percent of the assessed value of all the real and personal property within the district.
Indebtedness which has been incurred for the acquisition, construction, and operation of transit facilities, where the revenue from the transit facilities for three years or more next preceding has been sufficient to pay the interest and principal due on any bonds issued for its construction or acquisition, in addition to the cost of operation and maintenance, shall not be counted and included in ascertaining the limit of indebtedness.
The district may accept, without limitation by any other provisions of this act requiring approval of indebtedness, contributions or loans from the United States, this state, or any department, instrumentality, or agency of either thereof, for the purpose of financing the acquisition, construction, maintenance, and operation of transit facilities, and may enter into contracts and cooperate with, and accept cooperation from, the United States, this state, or any department, instrumentality, or agency of either thereof, in the acquisition, construction, maintenance, and operation, and in financing the acquisition, construction, maintenance, and operation, of any such transit facilities in accordance with any legislation which Congress or the Legislature of the State of California may have heretofore adopted or may hereafter adopt, under which aid, assistance, and cooperation may be furnished by the United States or this state in the acquisition, construction, maintenance, and operation of any such transit facilities. The district may do any and all things necessary in order to avail itself of such aid, assistance, and cooperation under any federal or state legislation now or hereafter enacted. Any evidence of indebtedness issued under this section shall constitute a negotiable instrument.
The district may purchase equipment such as cars, trolley buses and motorbuses, and rolling equipment, and may execute agreements, leases and equipment trust certificates in the forms customarily used by private corporations engaged in the transit business appropriate to effect the purchase and leasing of rolling equipment and may dispose of the equipment trust certificates upon the terms and conditions as the board may deem appropriate. All money required to be paid by the district pursuant to the agreements, leases and equipment trust certificates provided for in this section shall be payable solely from the revenues or income to be derived from the transit facilities and from grants and loans as provided in Section 90504. Payment for equipment, or the rental of equipment, may be made in installments and the deferred installments may be evidenced by equipment trust certificates payable solely from revenue or income as provided in this section, and title to the equipment shall not vest in the district until the equipment trust certificates are paid.
The agreement to purchase or lease may direct the vendor or lessor to sell and assign or lease the rolling equipment to a bank or trust company, duly authorized to transact business in the State of California, as trustee, for the benefit and security of the equipment trust certificates and may direct the trustee to deliver the rolling equipment to one or more designated officers of the district and may authorize the district to simultaneously execute and deliver an installment purchase agreement or a lease of the equipment to the district.
The agreements and leases shall be duly acknowledged before a person authorized by law to take acknowledgments of deeds and in the form required for acknowledgment of deeds. The agreements, leases, and equipment trust certificates shall be authorized by resolution of the district and shall contain such covenants, conditions and provisions as may be deemed necessary or appropriate to insure the payment of the equipment trust certificates from the revenue or income to be derived from the transit system.
The covenants, conditions and provisions of the agreements, leases, and equipment trust certificates shall not conflict with any of the provisions of any trust agreement securing the payment of bonds, notes or certificates of the district.
ARTICLE 7. Investments [90520. - 90522.]
The district may invest any surplus money in its treasury, including money in any sinking fund, in any of the following:
Its own bonds.
Treasury notes, certificates of indebtedness, bills, bonds of the United States, or any other evidence of indebtedness secured by the full faith and credit of the United States.
Treasury notes or bonds of this state, or of any public corporation, municipal corporation, public district, or political subdivision within this state which are legal as security for the deposit of public funds.
Such investment may be made by direct purchase of any issue of such bonds, treasury notes, or obligations, or part thereof, at the original sale or by the subsequent purchase of the bonds, treasury notes, or obligations.
Any bonds, treasury notes, or obligations purchased and held as investments by the district may from time to time be sold and the proceeds reinvested in bonds, treasury notes, or obligations as provided in this article.
ARTICLE 8. Taxation [90540. - 90552.]
A district may levy, and collect or cause to be collected, taxes for any lawful purpose.
If, in the opinion of the board, the revenues will not be sufficient for any and all lawful purposes, the board shall levy a tax for such purpose or purposes and fix the amount of money necessary to be raised therefor by taxation.
The board shall, at the time of fixing the general tax levy and in the manner provided for the general tax levy, levy and collect annually until the district’s bonds are paid, or until there is a sum in the treasury of the district set apart for that purpose to meet all sums coming due for principal and interest on the bonds as they become due a tax sufficient to pay the annual interest on the bonds and such part of the principal thereof as becomes due before the proceeds of a tax levied at the next general tax levy will be available. If the maturity of the indebtedness created by the issue of bonds begins more than one year after the date of the issuance thereof, the tax shall be levied and collected annually at the time and in the manner aforesaid, sufficient to pay the interest on the indebtedness as it falls due and to constitute a sinking fund for the payment of the principal on or before maturity.
The taxes required to be levied and collected on account of interest, principal and sinking fund of district bonds shall be in addition to all other taxes levied for district purposes, and shall be collected at the time and in the same manner as other district taxes are collected and be used for no other purpose than the payment of the bonds and accruing interest.
The board may provide for the assessment, levy, and collection of taxes by the district, including the sale of property to the district for delinquent taxes, with penalties, interest, and cost.
The board shall avail itself of the assessments made by the assessor of the county and of the assessments made by the State Board of Equalization for the county and shall take such assessments as the basis for district taxation and have its taxes collected by the tax collector of the county.
In such case the county assessor shall, on or before the third Monday in August of each year, transmit to the board a statement in writing showing the total value of all property within the district, ascertained from the assessments referred to in Section 90545 as equalized.
The board shall, on or before the first weekday in September, or if such weekday falls upon a holiday then on the first business day thereafter, fix the rate of taxes, designating the number of cents or fractions thereof upon each hundred dollars, using as a basis the value of property transmitted to the board by the county assessor, which rate of taxation shall be sufficient to raise the amount previously fixed by the board, subject to a maximum limitation of five cents ($0.05) per one hundred dollars ($100) assessed valuation. These acts by the board shall constitute a value assessment of the property and a valid levy of the taxes so fixed.
The board shall immediately after fixing the rate of taxes as above provided transmit to the county assessor of the county a statement of the rate of taxes fixed by the board.
The district’s taxes so levied shall be collected at the same time and in the same manner as county taxes. When collected the net amount, ascertained as provided in this article, shall be paid to the treasurer of the district, under the general requirements and penalties provided by law for the settlement of other taxes.
Whenever any real property has been sold for taxes and has been redeemed, the money paid for redemption shall be apportioned and paid to the district by the county treasurer in the proportion which the tax due to the district bears to the total tax for which the property was sold.
The compensation to be charged by and paid to any county for the performance of services under this article shall be fixed by agreement between the board of supervisors of the county and the board. The compensation shall in no event exceed one-half of 1 percent of all money collected for the district. The compensation collected by the county shall be placed to the credit of the county general fund.
All taxes levied under this act are a lien on the property on which they are levied. The enforcement of the collection of such taxes shall be in the same manner and by the same means provided by law for the enforcement of liens for county taxes, all the provisions of law relating to the enforcement of the latter being made a part of this act so far as applicable.
ARTICLE 9. Claims [90570. - 90570.]
All claims for money or damages against the district are governed by Chapter 2 (commencing with Section 700) of Division 3.5 of Title 1 of the Government Code except as provided therein, or by other statutes or regulations expressly applicable thereto.
CHAPTER 7. Bonds [90600. - 90721.]
ARTICLE 1. Issuance [90600. - 90612.]
The district may from time to time incur a bonded indebtedness as provided in this chapter to pay the cost of acquiring, constructing, or completing the whole or any portion of any, transit facilities, or for acquiring any works, lands, structures, rights, equipment, or other property necessary or convenient to carry out the objects, purposes, or powers of the district.
Whenever the board by resolution passed by vote of two-thirds of all its members determines that the public interest or necessity demands the acquisition, construction, or completion by the district of any transit facilities or any works, lands, structures, rights, equipment, or other property necessary or convenient to carry out the objects, purposes, or powers of the district, the cost of which will be too great to be paid out of the ordinary annual income and revenue of the district, it may at any subsequent meeting of the board provide by ordinance for the submission of the proposition of incurring a bonded indebtedness for the purpose set forth in the resolution to the voters of the district at a special bond election held for that purpose.
In lieu of a resolution passed by the board, proceedings for the issuance of bonds for the purposes provided in this chapter may be initiated by petition of the voters of the district.
Whenever any petition signed by voters within the district equal in number to at least 15 percent of the total vote cast at the last general election is presented to the board asking for the acquisition, construction, or completion of the whole or any portion of any transit facilities or for acquiring any works, lands, structures, rights, equipment, or other property necessary or convenient to carry out the objects, purposes, or powers of the district, and also asking that a bonded indebtedness be incurred to pay the cost thereof, the secretary of the district shall immediately examine and verify the signatures of the petition and certify the result of the examination to the board.
If the required number of signatures is found to be genuine, the secretary shall transmit to the board an authentic copy of the petition without the signatures.
Upon receiving a petition with the certificate of the secretary stating that it contains the required number of signatures, the board shall formulate for submission to the voters of the district at a special bond election called for that purpose the proposition of incurring a bonded indebtedness for the purposes set forth in the petition. In its discretion the board may defer the calling of the election until the next general election to be held in the district in order to consolidate them.
The ordinance calling a special bond election shall fix the date on which the election will be held, and the manner of holding the election and of voting for or against incurring the indebtedness. It shall also recite the objects and purposes for which the indebtedness is proposed to be incurred, the estimated cost of the transit facilities, works, lands, structures, rights, equipment, or other property proposed to be acquired, constructed, or completed, the amount of the principal of the indebtedness to be incurred therefor, and the maximum rate of interest to be paid on the indebtedness, which shall not exceed 6 percent per annum, payable semiannually or annually the first year and thereafter semiannually.
Propositions for incurring indebtedness for more than one object or purpose may be submitted at the same election.
Any special bond election may be held separately, or may be consolidated with any other election authorized by law at which the voters of the district may vote. If a special bond election is consolidated with any other election, the provisions of this chapter setting forth the precedure for the calling and holding of the special bond election shall be complied with, except that the ordinance calling the election need not set forth the election precincts, polling places, and officers of election shall be the same as those set forth in the ordinance, notice, or other proceedings calling the election with which the special bond election is consolidated, and shall refer to the ordinance, notice, or other proceedings by number and title, or by other definite description.
The ordinance shall be published, and no other notice of election need be given.
The board shall comply with Article 3 (commencing with Section 9160) of Chapter 2 of Division 9 of the Elections Code, the provisions of which are applicable to any bond election held pursuant to this article. Wherever the words “county clerk” or “county elections official” appear in the Elections Code the words “secretary of the board” shall be substituted, for the purposes of this article, and wherever the words “board of supervisors” appear in the Elections Code, the words “board of directors” shall be substituted, and wherever the words “district attorney or county counsel” appear in the Elections Code, the words “attorney for the district” shall be substituted.
The votes of 60 percent of all the voters voting on the proposition at the election are required to authorize the issuance of general obligation bonds under this chapter.
If the proposition submitted at a special bond election fails to receive the requisite number of votes, the board shall not within six months after the election hold another special election for the submission of a proposition of incurring a bonded indebtedness substantially the same as the proposition voted upon at a prior election unless a petition signed by voters within the district equal in number to at least 15 percent of the total vote cast at the last general election is filed with the board, requesting that the proposition, or a proposition substantially the same, be submitted at an election to be called for that purpose.
ARTICLE 2. Form and Content [90620. - 90623.]
Bonds authorized by this chapter shall mature serially in amounts to be fixed by the board; except that payment shall begin not later than 10 years from the date thereof and shall be completed in not more than 50 years from that date.
The board may divide any issue of bonds authorized pursuant to this chapter into two or more series, and may fix different dates of issuance and different maturity dates for the bonds of each series. The bonds of each series shall mature serially in amounts to be fixed by the board, and the board shall fix a date not more than 10 years from the date of issuance of each series for the earliest maturity of such series, and shall fix a date not more than 50 years from the date of issuance of each series for the final maturity of such series.
Pending the actual issuance or delivery of bonds, a district may issue temporary or interim bonds, certificates, or receipts, of any denomination, whatsoever, with or without coupon, and in such form as may be prescribed by the board to be exchanged for definite bonds when ready for delivery.
The bonds shall be issued in such denominations as the board determines, except that no bonds shall be issued of a denomination less than one hundred dollars ($100), nor of a greater denomination than one thousand dollars ($1,000) or any multiple thereof, and shall be payable on the day and at the place or places fixed in the bonds, and with interest at the rate specified therein, payable semiannually.
The board may at any time prior to the issuance and sale of any bonds provide for the call and redemption of any or all of the bonds on any interest payment date prior to their fixed maturity at not exceeding the par value and accrued interest plus a premium of not exceeding 5 percent upon the principal amount of the bonds, in which event the call price fixed by the board shall be set forth on the face of the bond. Notice of such redemption shall be published. If there is no newspaper of general circulation printed and published within the district, then the publication shall be made in a newspaper of general circulation printed and published within the county in which the district or any part thereof is situated. The first publication shall be at least 30 days prior to the date fixed for the redemption. After the date fixed for such redemption interest on the bonds thereafter shall cease.
The bonds shall be signed by the president of the board or by such officer of the district as the board shall by resolution authorize and designate for that purpose. They shall also be signed by the treasurer, and be countersigned by the secretary. The coupons of the bonds shall be numbered consecutively and be signed by the treasurer. All signatures and countersignatures, except one of said signatures or countersignatures on the bonds, may be printed, lithographed, or engraved. If any officer whose signature or countersignature appears on the bonds or coupons ceases to be such officer before the delivery of the bonds to the purchaser, the signature or countersignature is nevertheless valid and sufficient for all purposes as if he had remained in office until the delivery of the bonds.
ARTICLE 3. Issue and Sale [90640. - 90642.]
The bonds may be issued and sold for not less than their par value, but otherwise as the board determines. Before selling any bonds or any part thereof, the board shall give notice inviting sealed bids in such manner as the board may prescribe. If satisfactory bids are received, the bonds offered for sale shall be awarded to the highest responsible bidder. If no bids are received, or if the board determines that the bids received are not satisfactory as to price or responsibility of the bidders, the board may reject all bids received, if any, and either again give notice inviting bids or sell the bonds at private sale.
All premiums and accrued interest received on the sale of bonds shall be placed in the fund to be used for the payment of principal of and interest on the bonds. The remainder of the proceeds of the bonds shall be placed in the district treasury to the credit of the proper fund, and shall be used exclusively for the objects or purposes for which the bonds were voted; provided that when said objects and purposes have been accomplished any moneys remaining shall be transferred to the fund to be used for the payment of principal of and interest on the bonds, and that when all principal of and interest on the bonds shall have been paid, any balance of money then remaining shall be transferred to the general fund of the district.
In lieu of the immediate levy of a tax to pay the interest or any part thereof on any bonded indebtedness incurred in accordance with this part the board may, in the estimate of the amount of money necessary to be raised by the bonds, include a sum sufficient to pay interest on all of the bonds or part thereof during the period of acquisition, construction, or completion, but for no period in excess of five years.
ARTICLE 4. Refunding [90660. - 90666.]
Whenever the board by resolution passed by a vote of two-thirds of all its members determines that the refunding of the whole or any portion of the bonded indebtedness will be of advantage to the district the board may refund the bonded indebtedness or any portion thereof and issue refunding bonds of the district therefor.
The issuance of refunding bonds shall not be construed as the incurring or increase of an indebtedness within the meaning of this part, and the approval of the voters is not required for the issuance of refunding bonds. The board may provide for the call and redemption of any or all of the bonds on any interest payment date prior to their fixed maturity in the ordinance authorizing the issuance of the refunding bonds.
Except as otherwise provided, the provisions of this chapter shall substantially govern as to all matters pertaining to the issuance of refunding bonds, including and without limiting the generality of the foregoing, the form, execution, issuance, maturity, redemption, refunding, validation, the payment of interest from bond funds, and the status of the bonds as investments.
Refunding bonds shall bear interest at a rate not exceeding the interest rate on the refunded bonds, but payment of the refunding bonds shall begin not later than one year from the date thereof and be complete in not more than 40 years from that date.
The proceeds of the sale of refunding bonds shall be applied only to the purchase, or retirement at not more than par and accrued interest, or the call price, of the bonded indebtedness for which the refunding bonds were issued.
In lieu of selling refunding bonds and using the proceeds to purchase or retire the bonds to be refunded, the board may exchange refunding bonds at not less than par and accrued interest for the bonds so refunded.
Whenever outstanding bonds are refunded they shall be surrendered to the treasurer of the district, who shall cancel them by endorsing on their face the manner in which the refunding was effected (whether by exchange or purchase, and the amount for which so purchased, if any) and by perforating through each bond and each coupon attached thereto the word “canceled” together with the date of cancellation.
ARTICLE 5. Status as Investments [90680. - 90681.]
All bonds including refunding bonds issued by a district are legal investments for all trust funds and for the funds of all insurance companies, banks, both commercial and savings, and trust companies, and for the State School Fund and for all sinking funds under the control of the State Treasurer. Whenever any money or funds may by law be invested in or loaned upon the security of bonds of cities, cities and counties, counties, or school districts, in the state, such money or funds may be invested in or loaned upon the security of the bonds of the district; and whenever bonds of cities, cities and counties, counties, or school districts by law may be used as security for the faithful performance or execution of any court or private trust or of any other act, bonds of the district may be so used.
All bonds of the district, to the same extent as bonds of any other municipality, are legal for use by any state or national bank or banks in the state as security for the deposit of funds of the state or of any county, city and county, city, municipality, or other public or municipal corporation within the state.
ARTICLE 6. Validating Proceedings [90700. - 90700.]
An action to determine the validity of bonds, including refunding bonds, may be brought pursuant to Chapter 9 (commencing with Section 860) of Title 10 of Part 2 of the Code of Civil Procedure.
ARTICLE 7. Revenue Bonds [90720. - 90721.]
As an alternative procedure for the raising of funds, the district is authorized to issue bonds, payable from revenues of any facility or enterprise to be acquired or constructed by a district, in the manner provided by the Revenue Bond Law of 1941 (Chapter 6 (commencing with Section 54300) of Part 1 of Division 2 of Title 5 of the Government Code), all of the provisions of which are applicable to a district created pursuant to this part.
The district is a local agency within the meaning of the Revenue Bond Law of 1941 (Chapter 6 (commencing with Section 54300) of Part 1 of Division 2 of Title 5 of the Government Code). The term “enterprise” as used in the Revenue Bond Law of 1941 shall, for all purposes of this part, include transit facilities and any and all parts thereof and all additions, extensions and improvements thereto and all other facilities authorized to be acquired, constructed or completed by the district. A district may issue revenue bonds under the Revenue Bond Law of 1941, for any one or more facilities or enterprises authorized to be acquired, constructed, or completed by a district or, in the alternative may issue revenue bonds under the Revenue Bond Law of 1941, for the acquisition, construction and completion of any one of such facilities. Nothing in this article shall prevent a district from availing itself of, or making use of, any procedure provided in this part for the issuance of bonds of any type or character for any of the facilities or works authorized hereunder, and all proceedings may be carried on simultaneously, or in the alternative, as the directors may determine.
CHAPTER 8. Annexation of Cities [90770. - 90880.]
ARTICLE 1. Annexation Agreement [90770. - 90774.]
Any city not included within the boundaries of the district may be annexed thereto in the manner provided in this chapter, and if such annexation is successful, shall be entitled to seat one member on the district’s board of directors.
The legislative body of the city proposed to be annexed shall agree in writing with the board upon the terms and conditions of annexation, which agreement, among other things, may provide for the levy and collection of special taxes within the city in addition to the taxes elsewhere in this act provided for, the fixing of rates, rentals, and charges differing from those fixed or existing elsewhere within the district, the incurring or assumption of indebtedness, or the making of a payment or payments, or the transfer of property, real and personal, and other assets to the district by the city.
As an alternative to commencement of annexation proceedings by action of the legislative body of a city, a petition signed by voters within the city proposed to be annexed, equal in number to at least 10 percent of the total vote cast at the last general election, and asking that proceedings be taken for its annexation, may be addressed to the board and filed with the secretary of the district.
The petition may include one or more separate documents, but each document shall contain the affidavit of the party who circulated it, certifying that each name signed thereto is the true signature of the person whose name it purports to be. The secretary of the district shall compare the signatures on the petition with the affidavits of registration on file with the county elections official and if he or she finds that the petition has been signed by the required number of voters he or she shall attach his or her signature thereto and present the petition to the board.
If the board determines that the annexation of the city, whose voters have petitioned pursuant to Section 90773, would facilitate the acquisition or operation of any transit facilities for the district or be of advantage to the district, then the board shall also determine the terms and conditions upon which the annexation should be made. The terms and conditions of annexation shall be embodied in an annexation agreement. The annexation agreement may provide, among other things, for any or all of the items set forth in Section 90771.
ARTICLE 2. Approval by District [90790. - 90796.]
The agreement shall become effective and be binding upon the district and the city when approved in the manner set forth in this chapter.
The board shall by ordinance setting forth the agreement at length declare its intention of causing it to be executed by the district.
The ordinance, together with a notice fixing the time and place for hearing thereon, shall be published in the district pursuant to Section 6061 of the Government Code. The time fixed for the hearing shall be not less than 30 nor more than 60 days from the date of the publication of the ordinance.
At the hearing any person interested may file with the board written objections to the execution of the agreement.
Upon the hearing the board shall determine whether or not the agreement will be carried into execution and shall hear and determine all objections thereto. Failure of any person interested in the district or in the matter of the proposed execution of the agreement to show cause in writing pursuant to Section 90792 constitutes an assent on his part to a change in the boundaries of the district and to the execution of the agreement.
Any hearing on the agreement may be adjourned from time to time by the board without further notice other than an order to be entered upon the minutes of the meeting fixing the time and place of adjournment.
If no protests are filed or if the protests filed are overruled and denied, the board shall by resolution finally approve the agreement and authorize its execution, which shall become effective when executed by the city, duly authorized in the manner provided in this chapter.
When executed by the district the agreement shall be dated and an executed copy filed with the secretary of the district. An executed copy shall also be filed with the clerk of the city to be annexed.
ARTICLE 3. Approval by City [90810. - 90815.]
At any time after the board has finally approved the agreement of annexation the legislative body of the city to be annexed shall cause an election to be held in the city to determine whether the city will be annexed to the district upon the terms and conditions stated in the agreement.
The city shall cause to be held, concurrent with the annexation election, an election for the purpose of selecting one board member for the district in the event the annexation is successful. The initial member elected to represent the city on the board of directors shall serve until a successor is elected at the next succeeding election of directors within the city and qualifies.
Notice of election shall be published as provided in Section 6066 of the Government Code and shall either state that a copy of the annexation agreement is on file in the office of the secretary or clerk of the city proposed to be annexed, and open to the inspection of all persons interested, or set forth the terms and conditions of the agreement of annexation at length, in the discretion of the legislative body calling the election.
The ballots for the election shall contain substantially the instructions required to be printed on ballots for use at general state and county elections and in addition shall set forth the proposition of annexation substantially as follows:
If upon a canvass of the election it is found that a majority of all votes cast on the proposition at the election were cast in favor of the annexation, the proposition and all of the terms and conditions of the agreement of annexation shall be deemed carried and approved by the voters.
If the proposition fails to carry, the result shall be entered upon the minutes of the governing body of the city.
If the proposition receives the vote of the requisite majority of voters, the governing body of the city shall enter in its minutes an order declaring the result of the election and shall thereupon cause the agreement of annexation to be executed by its duly authorized officers.
ARTICLE 4. Establishment of Annexation [90830. - 90830.]
Upon receipt by the district of a copy of the agreement of annexation properly executed by the district and the city proposed to be annexed, the board shall pass a resolution declaring the city annexed to the district, and shall cause a certified copy of the resolution to be filed with the Secretary of State. From and after the date of filing of the resolution with the Secretary of State, the annexation of the city to the district is complete.
ARTICLE 5. Annexation of Territory to Cities [90850. - 90850.]
Any territory annexed in accordance with law to any city included in the district shall, upon the completion of such annexation proceeding, be deemed incorporated into and annexed to the district, and thereafter is subject to taxation, along with the entire territory of the district in accordance with the assessable valuation of the property thereof, for general district purposes, and for the payment of any indebtedness theretofore or thereafter incurred by the district.
ARTICLE 6. Effect of Annexation [90870. - 90871.]
From and after the date of annexation, the board shall levy upon all of the property in the city annexed, such taxes, tolls, or charges as are necessary to provide funds for the payment of the indebtedness assumed by the city or otherwise necessary to comply with the terms and conditions of the annexation agreement, all in addition to the general district taxes authorized elsewhere in this division to be levied and collected.
No annexation of a city to a district shall operate to dissolve or terminate the legal existence of the city annexed.
ARTICLE 7. Contest of Annexation [90880. - 90880.]
The validity of any proceedings for the annexation of any city to any district shall not be contested in any action unless the action is brought within three months after the completion of the proceedings.
CHAPTER 9. Annexation of Unincorporated Territory [90930. - 91040.]
ARTICLE 1. Annexation Agreement [90930. - 90936.]
Unincorporated territory may be annexed to the district in the manner provided in this chapter.
Unincorporated territory not contiguous to the district may not be annexed if the district does not possess facilities for supplying transit service to that territory.
A petition signed by voters within the territory proposed to be annexed equal in number to at least 10 percent of the total vote cast, describing the territory and asking that proceedings be taken for its annexation, shall be addressed to the board and filed with the secretary of the district.
The secretary shall compare the signatures on the petition with the affidavits of registration on file with the county elections official and if he or she finds that the petition has been signed by the required number of voters he or she shall attach his or her signature thereto and present the petition to the board.
If the board determines that the annexation of the territory would facilitate the acquisition or operation of any transit facilities for the district, or be of advantage to the district, then the board shall also determine the terms and conditions upon which the annexation should be made.
Provisions may be made, among other things, for payment of taxes within the territory to be annexed in addition to the taxes elsewhere in this act provided for, the fixing of rates, rentals, and charges differing from those fixed or existing elsewhere within the district, the incurring or assumption of indebtedness, or the making of a payment or payments, or the transfer of property, real and personal, and other assets to the district by the territory proposed to be annexed. The boundaries of the territory proposed to be annexed need not be coterminous with any election precincts. The terms and conditions shall become effective and be binding upon the district and the territory to be annexed with approval in the manner set forth in this chapter.
As an alternative to commencement of annexation proceedings by a petition by the voters within any unincorporated territory, proposed to be annexed, the legislative body of an unincorporated territory may agree in writing upon the terms and conditions of annexation, which agreement may contain, among other things, provisions as set forth in Sections 90934 and 90935.
ARTICLE 2. Approval by District [90950. - 90955.]
The board shall by ordinance setting forth the terms and conditions at length declare its intention of causing the agreement to be approved by the district.
The ordinance together with a notice fixing the time and place for hearing thereon shall be published in the district pursuant to Section 6061 of the Government Code. A copy of the ordinance shall be filed with the secretary of the district. The time fixed for hearing shall not be less than 30 nor more than 60 days from the date of the publication of the ordinance.
At the hearing any person interested may file with the board written objections to the approval of the terms and conditions.
Upon the hearing, the board shall determine whether or not the terms and conditions will be approved and shall hear and determine all objections thereto. Failure of any person interested in the district or in the matter of the proposed annexation on the terms and conditions set forth in the ordinance to show cause in writing pursuant to Section 90952 constitutes an assent on his part to a change in the boundaries of the district upon the terms and conditions set forth.
If no protests are filed or the protests filed are overruled and denied by the board, the board shall by resolution finally approve the terms and conditions and proceed with the annexation in the manner provided in this chapter.
If protests against the proposed annexation are sustained, all proceedings shall be dismissed and no proceedings shall be undertaken again concerning the territory or any part thereof until after the expiration of one year.
ARTICLE 3. Approval by Unincorporated Territory [90970. - 90975.]
Within 90 days after the board has finally approved the terms and conditions of annexation, the board shall cause an election to be held in the territory proposed to be annexed to determine whether the territory shall be annexed to the district upon the terms and conditions stated in the ordinance.
Notice of election shall be published and shall either state that a copy of the ordinance containing the terms and conditions of annexation at length is on file in the office of the secretary of the district, and open to the inspection of all persons interested, or set forth the terms and conditions of annexation at length, in the discretion of the board.
The ballots for the election shall contain substantially the instructions required to be printed on ballots for use at general state and county elections and in addition shall set forth the proposition of annexation substantially as follows:
In the event that no unincorporated territory shall have been included in the original formation of the district, an election shall be held concurrent with the first annexation election of unincorporated territory for the purpose of selecting one board member for the district in the event the annexation is successful. The initial member elected to represent the unincorporated territory on the board of directors shall serve until a successor is elected at the next succeeding election of directors within the unincorporated territory and qualifies.
If upon a canvass of the election it is found that a majority of all votes cast on the proposition at the election were cast in favor of the annexation, the proposition and all of the terms and conditions set forth in the ordinance shall be deemed carried and approved by the voters.
If the proposition fails to carry, the result shall be entered upon the minutes of the board.
If the proposition is defeated by the voters, no annexation proceeding shall be commenced involving the territory or any part thereof until after the expiration of one year.
ARTICLE 4. Establishment of Annexation [90990. - 90990.]
In the event the proposition receives the vote of the requisite majority of voters, the board shall pass a resolution declaring the territory annexed to the district, and shall cause a certified copy of the resolution to be filed with the Secretary of State, from and after the date of which filing with the Secretary of State the annexation of the territory to the district is complete.
ARTICLE 5. Annexation Without Election [91010. - 91012.]
Unincorporated territory may be annexed to a district without an election in the manner provided in this article.
A petition describing the territory proposed to be annexed and requesting that proceedings be taken for its annexation shall be signed by all of the owners of the real property described therein, verified by the affidavit of one of the petitioners, addressed to the board, and filed with the secretary of the district. If a portion of the territory consists of public highways, streets, roads or paths, it shall not be necessary to secure the signatures to the petition of the owners only of the real property occupied by such public highways, streets, roads or paths.
Proceedings shall thereafter be taken and a hearing held in substantial compliance with the provisions of this chapter relating to the annexation of unincorporated territory except that no election shall be held within the territory proposed to be annexed and the territory shall be deemed annexed to the district upon the passage of a resolution of the board declaring the territory annexed and the filing of a certified copy thereof with the Secretary of State.
ARTICLE 6. Effect of Annexation [91020. - 91020.]
From and after the date of annexation, the board shall levy upon all of the property in the territory annexed, such taxes, tolls, or charges as are necessary to provide funds for the payment of the indebtedness assumed by the territory or otherwise necessary to comply with the terms and conditions of the annexation, all in addition to the general district taxes authorized elsewhere in this act to be levied and collected.
ARTICLE 7. Contest of Annexation [91040. - 91040.]
The validity of any proceedings for the annexation of any unincorporated territory to any district shall not be contested in any action unless the action is brought within three months after the completion of the proceedings.
CHAPTER 10. Dissolution [92000. - 92008.]
If the district operates no transit facilities, or its exterior boundaries become coincident with the boundaries of a single city, the board may call an election at any time for the purpose of submitting to the voters of the district the question of whether the district will be dissolved. Upon the filing with the secretary of such a district of a petition signed by voters within the district equal in number to at least twenty-five percent (25%) of the total vote cast, asking that the question of dissolution of the district be submitted to the voters of the district, the board shall call such an election.
The election for the purpose of submitting to the voters of the district the question of whether or not the district shall be dissolved shall be held within 60 days next succeeding the date on which the petition is filed.
Notice of any election for dissolution, whether called because of the filing of a petition or ordered by the board without petition, shall be published. The date fixed for the election shall not be less than 30 days from the date of the first publication of the notice.
The ballots for the election shall contain substantially the instructions required to be printed on ballots for use at general state and county elections and in addition the following:
No other notice of the election other than that provided for in this chapter need be given and no sample ballots need be sent to the voters.
If upon a canvass of the election, it is found that a majority of all votes cast on the proposition at the election were in favor of the dissolution, the dissolution shall be deemed carried and approved by the voters. The board shall meet on Monday next succeeding the election and canvass the votes cast.
Upon dissolution of any district which has boundaries that are coincident with the corporate limits of a city, the district property wherever situated vests absolutely in the city, and upon the dissolution of any district operating no transit facilities and which has boundaries that extend beyond the boundaries of a single city the property of the district wherever situated vests in the county in which the whole or greater portion of the district is situated.
If at the time of dissolution, there is any outstanding indebtedness of the district the legislative authority of the city, where the limits of the district lie wholly within the corporate limits of a city, and in all other cases, the board of supervisors of the county in which the whole or greater portion of the district is situated are ex officio the board of directors of the district for the purpose only of the levy and collection of taxes for the payment of the indebtedness of the district existing at the time of dissolution and the interest thereon. The board or legislative authority shall levy the taxes and perform such other acts as are necessary to raise the money necessary for the payment of the indebtedness and the interest thereon.
In the event that the proposition for dissolution fails to carry, no subsequent election for the dissolution of the district shall be called until after the expiration of one year from the date of the prior election.
CHAPTER 11. Consolidation With Other Districts [93000. - 93017.]
The district may be consolidated with the Southern California Rapid Transit District organized and operating pursuant to Part 3 (commencing with Section 30000) of this division, in the manner provided in this chapter.
Whenever the board finds and determines that:
The Southern California Rapid Transit District is willing to annex the territory comprising the district;
The annexing district has adequate facilities for and is able to supply transit service to the district in a manner equal to or superior to that presently rendered by the district;
Annexation will not result in assumption of financial obligations by the taxpayers of the district disproportionate to the services which they will receive; the board shall thereafter negotiate an agreement with the annexing district specifying the terms and conditions of annexation and such other matters as are necessary and incidental thereto.
The board shall thereafter, by resolution setting forth the terms and conditions of the proposed contract at length, declare its intention to cause the agreement to be approved and effect consolidation of the district with the Southern California Rapid Transit District.
The resolution, together with a notice fixing the time and place for hearing thereon, shall be published once in a newspaper of general circulation published in the district. The time fixed for hearing shall not be less than 30 nor more than 60 days from the date of publication of such notice.
At the hearing any interested person may file with the board written objections to the approval of the terms and conditions of the proposed contract or the consolidation, or both the proposed contract and the consolidation.
Upon the hearing, the board shall determine whether or not the terms and conditions of the contract will be approved and the consolidation effected, and shall hear and determine all objections thereto.
Any hearing on the agreement and consolidation may be adjourned from time to time by the board, not exceeding 30 days in all, without further notice other than an order entered upon the minutes of the meeting fixing the time and place of adjournment.
If no protests are filed, or if the protests filed are overruled and denied by the board, the board shall thereupon by resolution finally approve the terms and conditions of the agreement and proceed with the consolidation.
At any time after the board of directors of the district has finally approved the agreement the Board of Supervisors of San Diego County shall cause an election to be held in the district to determine whether the San Diego County Transit District will be consolidated with the Southern California Rapid Transit District upon the terms and conditions stated in the agreement.
Notice of election shall be published once a week for two successive weeks (two publications) in a newspaper of general circulation published within the district, and shall either state that a copy of the consolidation agreement is on file in the office of the Clerk of San Diego County, and open to the inspection of all persons interested, or set forth the terms and conditions of the consolidation agreement at length, in the discretion of the board of supervisors calling the election.
The ballots for the election shall contain substantially the instructions required to be printed on ballots for use at general state and county elections and in addition shall set forth the proposition of consolidation substantially as follows:
If upon a canvass of the election it is found that a majority of all votes cast on the proposition at the election were cast in favor of the consolidation, the proposition and all of the terms and conditions of the consolidation agreement shall be deemed carried and approved by the voters.
If the proposition fails to carry, the result shall be entered upon the minutes of the Board of Supervisors of San Diego County.
If the proposition receives the vote of the requisite majority of voters, the Board of Supervisors of San Diego County shall enter in its minutes an order declaring the result of the election and shall thereupon cause the consolidation agreement to be executed by its duly authorized officers.
Upon receipt by the Southern California Rapid Transit District of a copy of the consolidation agreement properly executed by the district and San Diego County the board of directors of the Southern California Rapid Transit District shall pass a resolution declaring the San Diego County Transit District consolidated with the Southern California Rapid Transit District, and shall cause a certified copy of the resolution to be filed with the Secretary of State. From and after the date of filing of the resolution with the Secretary of State the consolidation of the San Diego County Transit District with the Southern California Rapid Transit District is complete.
From and after the date of consolidation the board of directors of the Southern California Rapid Transit District shall levy upon all of the property in the former San Diego County Transit District such taxes, tolls, or charges as are necessary to provide funds for the payment of the indebtedness assumed by the former district or otherwise necessary to comply with the terms and conditions of the consolidation agreement, all in addition to the general district taxes authorized elsewhere in Part 3 (commencing with Section 30000) of this division to be levied and collected.
The validity of any consolidating proceedings shall not be contested in any action unless the action is brought within three (3) months after the completion of the proceedings.
Upon the completion of such consolidation procedure, the San Diego County Transit District shall be deemed to be dissolved. Thereafter, all property and assets of the district which are not subject to the negotiated contract pertaining to consolidation shall be distributed to the County of San Diego.
PART 9. THE SANTA BARBARA METROPOLITAN TRANSIT DISTRICT [95000. - 97007.]
CHAPTER 1. General Provisions [95000. - 95035.]
ARTICLE 1. Definitions [95000. - 95006.]
This act shall be known and cited as the “Santa Barbara Metropolitan Transit District Act of 1965.”
Unless the context otherwise requires, the provisions of this article govern the construction of this part.
“District” means the Santa Barbara Metropolitan Transit District formed under this act.
“Board” means the board of directors of this district.
“Voter” means any elector who is registered under the Elections Code.
“Transit” means the transportation of passengers only and their incidental baggage by means other than by chartered bus, sightseeing bus, or any other motor vehicle not on an individual passenger fare-paying basis. Nothing in this section shall be construed to prohibit the district from leasing its buses to private certified public carriers or to prohibit the district from providing schoolbus service for the transportation of pupils between their homes and schools.
“Transit works” or “transit facilities” means all real and personal property, equipment, rights, or interests owned or to be acquired by the district for transit service.
ARTICLE 2. General Provisions [95030. - 95035.]
It is necessary that a transit district be established in the Santa Barbara metropolitan area which includes the City of Santa Barbara and adjacent territory, including but not limited to the Carpinteria, Summerland, Montecito and Goleta areas, all situated in Santa Barbara County, in order to meet the public transit problem of the area. The geographic location of the city in relation to the adjacent territory requiring transportation services makes it necessary to develop a single transit system to protect the public interest and welfare.
The Santa Barbara Metropolitan Transit District may be created as provided in this act and when so created may exercise the powers herein granted.
Except as otherwise provided in this act elections shall be held and conducted and the result ascertained, determined, and declared in, all respects as nearly as practicable in conformity with the general elections laws of the state.
Except as otherwise provided in this part all ordinances and notices which are required to be published shall be published within the district pursuant to Section 6066 of the Government Code.
Whenever the signature of any officer or employee of a district or of any member of the retirement board or of any officer or employee of the retirement system is authorized or required under the provisions of this act, except in the single instance provided in Section 96443, the signature may be made by the use of a plate bearing facsimiles of such signatures.
The boundaries of the district shall not be affected by reason of the incorporation of any territory wholly or partly within the boundaries of the district, or by reason of annexation to or detachment from any city of territory wholly or partly within the boundaries of the district, except as provided in this part.
Where territory outside the district is annexed to any city included in the district, said territory shall, upon the completion of such annexation proceeding, be deemed incorporated into and annexed to the district; provided that, where territory which is incorporated as a new city is partly within and partly outside the district, that territory which is outside the district shall, upon the completion of such incorporation proceeding, be deemed incorporated into and annexed to the district; and provided further that no incorporated city now lying entirely outside the boundaries of the district shall be included within the district without the consent of the legislative body of said city, and any territory annexed by such city, if such annexed territory is then within the district, shall be automatically excluded from the district, unless the legislative body of the city shall otherwise declare in its ordinance of annexation.
Whenever territory is deemed incorporated into and annexed to the district pursuant to this section, such territory shall be subject to taxation, in accordance with the assessable valuation of the property thereof, for general district purposes and for the payment of any indebtedness theretofore or thereafter incurred by the district.
CHAPTER 2. Formation of District [95100. - 95250.]
ARTICLE 1. General Provisions [95100. - 95101.]
The City of Santa Barbara, together with unincorporated territory, may organize and incorporate as the Santa Barbara Metropolitan Transit District.
The request for the formation of the Santa Barbara Metropolitan Transit District may be made by resolution or by petition as set out in this chapter.
ARTICLE 2. Request by Resolution [95130. - 95132.]
The legislative body, the City Council of the City of Santa Barbara, may pass a resolution declaring that in its opinion public interest or necessity demands the creation and maintenance of the Santa Barbara Metropolitan Transit District.
The resolution may state the transit facilities proposed to be first acquired, but failure to acquire such transit facilities shall not affect the validity of the district. The resolution shall set forth and describe the boundaries of the proposed district.
Certified copies of the resolution shall be presented to the Board of Supervisors of Santa Barbara County requesting the board of supervisors to call an election without delay for determining whether the district will be created.
ARTICLE 3. Request by Petition [95160. - 95163.]
Instead of a resolution, a petition may be presented to the board of supervisors signed by voters within the proposed district equal in number to at least 25 percent of the total vote cast at the last general election.
The petition shall contain substantially the same declarations and statements required to be contained in the resolution presented to the board of supervisors under this chapter, including the description of the boundaries, and declare that, in the opinion of the petitioners, public interest or necessity demands the creation and maintenance of the metropolitan transit district.
The petition may be on separate papers, but each paper shall contain the affidavit of the person who circulated it certifying that each name signed thereto is a true signature of the person whose name it purports to be.
The County Elections Official of the County of Santa Barbara shall compare the signatures to the petition with the affidavits of registration and certify to their sufficiency or insufficiency.
ARTICLE 4. Election [95190. - 95200.]
Upon receipt of certified copies of the resolution or of a sufficient petition, the board of supervisors shall hold a hearing on the question of forming a Santa Barbara Metropolitan Transit District. The hearing shall be held not less than 20 days nor more than 60 days following the filing of such resolution or petition. A notice of such hearing shall be published at least twice in newspapers of general circulation in the proposed district.
The board of supervisors shall have the power to exclude unincorporated areas which, in the board’s determination, would not receive reasonable benefit from inclusion in the district.
At the conclusion of the hearing, if the board of supervisors approves the resolution or petition as originally presented or in modified form, it shall by resolution entered upon its minutes:
Fix and describe the exterior boundaries of the proposed district as determined by the board of supervisors.
Fix the date on which an election will be held in the proposed district and the hours during which the polls will be open.
State the purpose for which the election is held.
The election shall be held not less than 60 days nor more than 90 days from the date of the adoption of the resolution prescribed by Section 95192.
The election shall be called by publishing notice calling the election pursuant to Section 6066 of the Government Code not less than 20 days before the election. The notice need only specify the time and place of the election, the hours during which the polls will be open, the purpose of the election, and the description of the exterior boundaries of the proposed district as determined by the board of supervisors.
No notice of the election other than the notice prescribed by this section need be given except that the county elections official shall mail notice of the polling place and the purpose of the election to each qualified elector of the proposed district.
The ballot for the election shall contain such instructions as are required by law to be printed thereon and in addition thereto the following:
No person shall be entitled to vote at the election unless he is a voter of the territory included in the proposed district.
The election may be held on the same day as any other state, county, or city election and be consolidated therewith.
The board of supervisors shall meet on the Tuesday next succeeding the day of the election and canvass the returns.
The board of supervisors shall make all provisions for the holding of the election throughout the entire district as proposed, and shall pay the cost thereof.
If a special election is held exclusively on the proposition of organizing the district, the expenditure therefor shall be reimbursed to the county by means of a tax on all the taxable property within the district, and this tax shall be added to the next county tax bills by the proper official of the county.
ARTICLE 5. Establishment of the District [95230. - 95230.]
If a majority of the electors voting on the proposition vote in favor of the creation and establishment of the district, the board of supervisors shall cause a certified copy of the order declaring the result of the election to be filed in the office of the Secretary of State, from and after which the establishment of the district shall be deemed complete.
ARTICLE 6. Contest of Incorporation [95250. - 95250.]
No informality in any proceeding or in the conduct of the election, not substantially affecting adversely the legal rights of any citizen, shall be held to invalidate the incorporation of the district. Any proceedings wherein the validity of incorporation is denied shall be commenced within three months from the date of filing the order declaring the result of the election with the Secretary of State, otherwise the incorporation and the legal existence of the district shall be held to be valid and in every respect legal and incontestable.
CHAPTER 3. Internal Organization of District [95400. - 95536.]
ARTICLE 1. Government [95400. - 95404.]
The government of the district shall be vested in a board of seven members. Two of the directors shall be appointed by the Board of Supervisors of the County of Santa Barbara. Two of the directors shall be appointed by the City Council of the City of Santa Barbara. One of the directors shall be appointed by the City Council of the City of Carpinteria. One of the directors shall be appointed by the City Council of the City of Goleta. The six directors so appointed shall choose and appoint the seventh director. The board shall elect its chairman, and a majority vote is necessary for the election of the chairman of the board.
These appointments shall be made within 30 days after the formation of the district.
Any vacancy on the board, including any caused by the death or resignation of a member, shall be filled by the body which appointed the director whose office is vacated and the new appointee shall hold his office for the unexpired term.
Any vacancy created by the expiration of a term shall likewise be filled by the body which appointed the director whose term has expired.
Each director shall, within 10 days after his appointment, and before entering upon the discharge of his duties of his office, take and subscribe to an oath in the form set forth in Section 3 of Article XX of the Constitution of California before an officer authorized by law to administer oaths. The oaths shall be filed in the office of the district.
A person shall not be appointed to or be a member of the board unless he is a resident of the district and has resided within the district at least one year immediately prior to his appointment to the board.
ARTICLE 2. Terms of Office [95430. - 95430.]
The term of office of each director is four years from the time of his appointment, except that for the board first appointed, the director appointed by the board as herein provided shall hold office for two years, and the remaining directors first appointed to the board shall classify themselves by lot, so that the two appointed by the board of supervisors shall hold office for one and three years and the two appointed by the city council shall hold office for two and four years.
ARTICLE 3. Powers and Duties of Directors [95450. - 95460.]
The chairman is the presiding officer of the board and he shall vote on the propositions passed upon by the board.
The first meeting of the board shall be held within 10 days of the appointment of its chairman. The board may make its own rules of procedure and determine the place and time of its meeting.
The board shall select one of its members vice chairman, who shall preside in the absence of its chairman. The board shall provide for and select such officers as it deems necessary to conduct the affairs of the district.
All matters and things necessary for the proper administration of the affairs of the district which are not provided for in this act shall be provided for by the board.
The board shall supervise and regulate every transit facility owned and operated by the district, including the fixing of rates, rentals, charges and classifications, and the making and enforcement of rules, regulations, contracts, practices, and schedules, for or in connection with any transit facility owned or controlled by the district.
The board may either operate the transit system itself or a part thereof or it may contract with any other public or private agency or corporation to operate all or part of the transit system for the district or it may contract with any other public or private agency or corporation for the improvement in transit services, facilities, equipment or operations being operated and conducted by said agency or corporation in, and, or, out of, the district.
The board may adopt a personnel system for the purpose of recruiting and maintaining an effective working force with good morale. The board shall by resolution determine and create such number and character of positions as are necessary properly to carry on the functions of the district and shall establish an appropriate salary, salary range, or wage for each position so created. The board may by resolution abolish any such position. Except as otherwise provided, appointments to such positions shall be made by the general manager.
The board may from time to time contract for or employ any professional service required by the district or for the performance of work or services which cannot satisfactorily be performed by the regular employees of the district.
The board shall have an annual audit made of all books and accounts of the district by a certified public accountant or public accountant. The general manager shall cause copies of such audit to be made available to the public at the cost of printing only.
The board may provide by resolution, under such terms and conditions as it sees fit, for the payment of demands against the district without prior specific approval thereof by the board if the demand is for a purpose for which an expenditure has been previously approved by the board and in an amount no greater than the amount so authorized, and if the demand is approved by the general manager.
To facilitate the business of the district, the board may provide for the creation and administration of such funds as the needs of the district may require. The funds shall be disbursed in accordance with rules established by the board and all payments from any fund shall be reported to the board.
ARTICLE 4. Meetings and Legislation [95490. - 95495.]
All meetings of the board shall be conducted in a manner prescribed by the Ralph M. Brown Act, Chapter 9 (commencing with Section 54950), Part 1, Division 2, Title 5 of the Government Code.
A majority of the board constitutes a quorum for the transaction of business.
The board shall establish rules for its proceedings and may provide by ordinance or resolution that each member shall receive for each attendance at the meetings of the board the sum of sixty dollars ($60) but not to exceed one hundred eighty dollars ($180) in any calendar month and shall be allowed such necessary traveling and personal expenses incurred in the performance of his or her duties as authorized by the board.
The acts of the board shall be expressed by motion, resolution, or ordinance. No ordinance shall be passed by the board on the day of its introduction, nor within three days thereafter, nor at any time other than a regular or adjourned regular meeting. No ordinance, resolution, or motion shall have any validity or effect unless passed by the affirmative votes of a majority of the directors.
All ordinances shall be published after passage.
The enacting clause of all ordinances shall be as follows:
“Be it enacted by the Board of Directors of the Santa Barbara Metropolitan Transit District:” All ordinances shall be signed by the chairman of the board or the vice chairman and attested by the secretary.
ARTICLE 5. Other Officers [95520. - 95536.]
The board shall appoint and fix the salary of a general manager, who shall have full charge of the acquisition, construction, maintenance, and operation of the facilities of the district, and also of the administration of the business affairs of the district.
All other things being equal, the board shall appoint as general manager, a person who has had experience in the construction or management of transit facilities.
The general manager need not be a resident of this state at the time of his appointment.
The general manager may be removed by the board upon the adoption of a resolution by the affirmative vote of not less than a majority of the board. Before the general manager may be removed, he shall, if he demands it, be given a written statement of the reasons alleged for his removal and he shall have the right to be publicly heard thereon at a meeting of the board prior to the final vote on the resolution providing for his removal, but pending and during such hearing the board may suspend him from office. The board may not reduce the salary of the general manager below the amount fixed at the time of his original appointment except upon the adoption of a resolution by a like vote and after a like opportunity to be heard. The action of the board in suspending or removing the general manager or reducing his salary, if approved by a majority of the membership of the board, is final.
Notwithstanding anything to the contrary in Section 95523, until such time as the district has operated, controlled, or used facilities or parts of facilities for providing the inhabitants within the boundaries of the district with transit services for a period of six months, the board may, but is not required to, appoint a general manager. A general manager appointed during such time holds office at the pleasure of the majority of the board.
The board may appoint a secretary and an attorney who may hold office during the pleasure of the board.
The attorney shall be admitted to practice law in the Supreme Court of the state, and shall have been actively engaged in the practice of his profession for not less than three years next preceding his appointment.
The board may consolidate any of the district offices in one person.
The oath of all appointive officers of the district shall be taken, subscribed, and filed with the secretary of the district at any time after the officer has notice of his appointment but not later than 15 days after the commencement of his term of office. No other filing is required.
Each appointive officer shall give such bond and in such amount as the board may require.
Subject to the control of the board, the powers and duties of the general manager are:
To have full charge of the acquisition, construction, maintenance, and operation of the facilities of the district.
To have full charge of the administration of the business affairs of the district.
To see that all ordinances of the district are enforced.
To administer the personnel system adopted by the board and except for officers appointed by the board to appoint, discipline or remove all officers and employees subject to the rules and regulations adopted by the board.
To attend all meetings of the board and submit a general report of the affairs of the district.
To keep the board advised as to the needs of the district.
To prepare or cause to be prepared all plans and specifications for the construction of the works of the district.
To devote his entire time to the business of the district.
To perform such other and additional duties as the board may require.
The attorney shall take charge of all suits and other legal matters to which the district is a party or in which it is legally interested. He shall give his advice or opinion in writing whenever required by the board. He shall be the legal adviser of the general manager and other district officers and shall prepare or approve the forms of all ordinances, resolutions, contracts, bonds, and other legal documents connected with the business of the district. He shall perform such other and additional services as the board may require.
The general manager shall cause to be installed and maintained a system of auditing and accounting which shall completely and at all times show the financial condition of the district. All warrants for the payment of demands against the district shall be paid in accordance with such rules as the board may establish.
The general manager shall provide for the custody of the funds of the district and the keeping of accounts of all receipts and disbursements. Payments shall be made only upon warrants duly and regularly signed by the chairman or vice chairman of the board, or other person authorized by the board so to do, and by the general manager, treasurer, or secretary.
With the consent of the board, the general manager may:
Authorize the trust department of any state or national bank in this state, or a trust company authorized to act as such in this state, to receive as his agent deposits of any securities acquired by the district.
Place and maintain for safekeeping as a trust deposit with the trust department of any state or national banks in this state, or a trust company authorized to act as such in this state, any securities owned by the district.
The bank or trust company selected shall have a total paid-in capital of at least one million dollars ($1,000,000). The general manager shall take from the trust department or trust company a receipt for the securities, and neither the general manager nor the district is responsible for the custody and safe return of the securities until they are withdrawn from the trust department or trust company by the general manager. Any trust department or trust company to which securities are delivered, either as agent or depository for the general manager, shall make such deposition of the securities as the general manager directs and is responsible only for strict compliance with written instructions given to it by the general manager. All such securities are at all times subject to the order of the general manager.
CHAPTER 4. Labor Provisions [95650. - 95656.]
If a majority of the employees employed by a transit district in a unit appropriate for collective bargaining indicate a desire to be represented by a labor organization, then the board after determining pursuant to Section 95651 that the labor organization represents the employees in the appropriate unit, shall bargain with the accredited representative of those employees. Both parties shall bargain in good faith and make all reasonable efforts to reach agreement on the terms of a written contract governing wages, salaries, hours, working conditions, and grievance procedures.
If a dispute arises over the terms of a written contract governing wages, salaries, hours, or working conditions that is not resolved by negotiations conducted in good faith between the board and the representatives of the employees, then the board and the representatives of the employees shall submit the dispute to an arbitration board. The decision of a majority of the arbitration board shall be final.
The arbitration board shall be composed of two representatives of the transit board, two representatives of the labor organization, and a fifth member to be agreed upon by the representatives of the transit board and labor organization. If the representatives of the transit board and labor organization are unable to agree on the fifth member, then the names of five persons experienced in labor arbitration shall be obtained from the California State Mediation and Conciliation Service.
The labor organization and the district shall, alternately, strike a name from the list supplied by the California State Mediation and Conciliation Service. The labor organization and the district shall determine by lot who shall first strike a name from the list. After the labor organization and the district have stricken four names, the name remaining shall be designated as the arbitrator.
The transit board and labor organization shall each pay half of the cost of the impartial arbitrator.
A contract or agreement shall not be made with any labor organization, association, group, or individual that denies membership on any basis listed in subdivision (a) of Section 12940 of the Government Code, as those bases are defined in Sections 12926 and 12926.1 of the Government Code. However, the organization may preclude from membership any individual who advocates the overthrow of the government by force or violence.
The district shall not discriminate with regard to employment against any person on any basis listed in subdivision (a) of Section 12940 of the Government Code, as those bases are defined in Sections 12926 and 12926.1 of the Government Code, except as otherwise provided in Section 12940 of the Government Code.
If there is a question whether a labor organization represents a majority of employees or whether the proposed unit is or is not appropriate, such matters shall be submitted to the State Conciliation Service for disposition. The State Conciliation Service shall promptly hold a public hearing and may, by decision, establish the boundaries of any collective bargaining unit and provide for an election to determine the question of representation. Provided, however, any certification of a labor organization to represent or act for the employees in any collective bargaining unit shall not be subject to challenge on the ground that a new substantial question of representation within such collective bargaining unit exists until the lapse of one year from the date of certification or the expiration of any collective bargaining agreement, whichever is later.
Whenever any district acquires existing facilities from a publicly or privately owned public utility either in proceedings by eminent domain or otherwise, to the extent necessary for operation of facilities, all of the employees of such public utility whose duties pertain to the facilities acquired who have been employed by said utility for at least seventy-five (75) days shall be appointed to comparable positions in the district without examination and shall be governed thereafter by the personnel system adopted by the board, and these employees shall be given sick leave, seniority and vacation credits in accordance with the records of the acquired public utility.
The provisions of this section shall apply only to those officers or supervisory employees of the acquired utility as shall be designated by the board.
Whenever any district acquires existing facilities from a publicly or privately owned public utility, either in proceedings in eminent domain or otherwise, that has a pension plan in operation, members and beneficiaries of such pension plan shall continue to have the rights, privileges, benefits, obligations and status with respect to such established system.
Whenever any such facilities are acquired by the district, the board shall consider and take into account the outstanding obligations and liabilities of the publicly or privately owned public utility by reason of such pension plan and shall negotiate an allowance in the purchase price of such utility for the assumption of such obligations and liabilities when acquiring the facilities.
The persons entitled to pension benefits as provided for in Section 95653 and the benefits which are provided shall be specified in the agreement or order by which any public utility is acquired by the district.
All persons receiving pension benefits from such acquired public utility and all persons entitled to pension benefits under the pension plan of such acquired public utility may become members or receive pensions under the retirement system established by the district by mutual agreement of such persons and the district.
Notwithstanding any provisions of the Government Code, the board may authorize payment of any or all of the premiums on any group life, accident and health insurance, health and welfare plan, or pension or retirement plan, on officers or employees of the district. Upon authorization by its employees, the district may make deductions from the wages and salaries of its employees:
Pursuant to collective bargaining agreement with a duly designated or certified labor organization for the payment of union dues, fees, or assessments.
For the payment of contributions pursuant to any health and welfare, pension, or retirement plan.
For any purpose for which deductions may be authorized by employees of any private employer.
CHAPTER 5. Retirement System [95800. - 95891.]
ARTICLE 1. Establishment [95800. - 95806.]
The board may establish a retirement system for the officers and employees of the district and provide for the payment of annuities, pensions, retirement allowances, disability payments, and death benefits or any of them.
The district may maintain its own retirement fund or may provide for benefits to eligible officers and employees, or their beneficiaries, by means of group insurance, or other insurance, or by such means as in the opinion of the board will satisfactorily provide an adequate and sure method of meeting the payments contemplated by the retirement system.
The board may adopt all ordinances and resolutions and perform all acts necessary or convenient to the initiation, maintenance, and administration of the retirement system.
Nothing in this chapter prevents the district from participating in and making all or part of its employees members of the State Employees’ Retirement System by contract entered into between the district and the board of administration of the system under the State Employees’ Retirement Law or from participating in the Federal Social Security Act pursuant to Part 4 (commencing with Section 22000), Division 5, Title 2 of the Government Code, and the district may perform all acts necessary or convenient for such participation. Nothing in this chapter shall prevent the district from participating in and making all of its employees members of the Santa Barbara County Employees’ Retirement System.
The board may classify and determine the officers and employees who shall be included as members in the retirement system and may change the classification from time to time. Membership of all officers and employees so classified and included in the retirement system is compulsory. The retirement system shall not apply to members of the board.
In the event the board elects to adopt and maintain its own retirement system, that system shall comply with this article and the requirements of: (1) Article 2 (commencing with Section 95830), Article 3 (commencing with Section 95860) and Article 4 (commencing with Section 95890) of this chapter; or (2) applicable federal law to establish a qualified plan under Section 401 (a) of, and a tax exempt trust under Section 501 (a) of, the Internal Revenue Code of 1954, as amended.
ARTICLE 2. Benefits and Contributions [95830. - 95836.]
The board may prescribe the terms and conditions upon which the officers and employees of the district or their beneficiaries shall be entitled to benefits and the amounts thereof, provided, that said board shall have no such authority respecting the County Employees Retirement Act of 1937.
The retirement allowance may be predicated in part upon service rendered the district by a member prior to the establishment of the retirement system, which service is known as “prior service.”
The board shall provide that both the district and the members shall contribute to the retirement system. The rate of contribution by an officer or employee of the district becoming a member of the retirement system shall be so fixed as to provide, with accumulated interest and based on tables and assumptions adopted by the board, substantially one-half the value of any retirement allowance granted for service, exclusive of any credits allowed for prior service.
All members of the retirement system shall contribute in the manner and amount fixed by the board and such contributions may be collected by deducting the amounts thereof from the salary, wages or compensation due such members.
Liabilities accruing under the retirement system because of benefits other than such as are the equivalent of contributions by the members, with accumulated interests, shall be met by contributions by the district. Prior service or other liabilities of the district may be met by annual appropriations instead of by one appropriation for the total of the liabilities; but until the present value of regular contributions for current service, together with assets then available, equals the present value of all allowances and benefits granted or to be granted under the system, the appropriation for any one year when added to any unused balance of any previous appropriations for such purpose shall not be less than the amount disbursed during that year on account of prior service or other liabilities of the district.
If any member withdraws from the retirement system prior to retirement the total amount contributed by him with such interest as may be credited thereto, shall be returned to him; provided, however, that the board may prescribe the terms and conditions upon which a member, whose district service is terminated except by death or retirement, may elect to leave his contributions and interest thereon in the retirement fund, and the terms and conditions upon which a retirement allowance may be made to him after such termination based upon his contributions prior to such termination.
All money received by any person as an annuity, pension, retirement allowance, disability payment or death benefit, from the retirement system, and all contributions and interest thereon returned to any member of the retirement system, whether in the actual possession of such member or deposited, loaned, or invested by him, is exempt from execution or any other process except to the extent permitted by Section 704.110 of the Code of Civil Procedure and is unassignable.
ARTICLE 3. Retirement Board [95860. - 95863.]
The board shall create a retirement board of not more than five members, at least two members of which shall be the elected representatives of the employees, to administer the retirement system, and shall define its powers and duties and the tenure of the members.
All members of the retirement board shall serve without pay.
The retirement board shall determine the eligibility of officers, employees, and their dependents to participation in the system and shall be the sole authority and judge under such ordinances as may be adopted by the board as to the conditions under which persons may be admitted to and continue to receive benefits of any sort under the retirement system, and may modify allowances for service and disability. The determination of the retirement board shall be final and conclusive and shall not be modified or set aside except for fraud or abuse of discretion.
If the district maintains its own retirement fund the retirement board shall have exclusive control of the administration, investment, and disbursement of such fund. Investment of the fund shall be subject to the terms, conditions, limitations, and restrictions imposed by the laws of this state upon savings banks in the making of investments by savings banks, and cash may be deposited in any licensed national bank or banks in this state or in any bank, banks, or corporations authorized or licensed to do a banking business and organized under the laws of this state.
ARTICLE 4. Investigation and Penalties [95890. - 95891.]
At least once in each four-year period after the establishment of the retirement system the board shall cause to be made an actuarial valuation of the assets and liabilities of the retirement fund and upon the basis of such investigation and valuation shall make such revision or change of the rate of contribution, the periods and conditions of service, and amounts of retirement allowances as may be necessary.
Except as herein provided, no member of the board or of the retirement board, nor any member of the retirement system or employee of the district, shall have any interest direct or indirect in the making of any investment or in the gains or profits accruing therefrom, and no such person, directly or indirectly, for himself or as an agent or partner of others, shall borrow any of its funds, nor shall any such person in any manner use the same except to make such current and necessary payments as are authorized by the retirement board, nor shall such a person become an endorser or surety as to, or in any manner an obligor for investments of the retirement fund.
CHAPTER 6. Powers and Functions of District [96000. - 96230.]
ARTICLE 1. Corporate Power [96000. - 96002.]
The district has perpetual succession and may adopt a seal and alter it at pleasure.
The district may sue and be sued, except as otherwise provided by law, in all actions and proceedings, in all courts and tribunals of competent jurisdiction.
The district may exercise the right of eminent domain to take any property necessary or convenient to the exercise of the powers granted in this part. The district, in exercising such power shall, in addition to the damage for the taking, injury, or destruction of property, also pay the cost of removal, reconstruction, or relocation of any structure, railways, mains, pipes, conduits, cables or poles of any public utility or public district which is required to be moved to a new location.
No action in eminent domain to acquire property within any incorporated city or any county shall be commenced unless the legislative body of the affected city or county has consented to such acquisition by resolution.
No such taking or acquisition by the district which would involve the abandonment, removal, relocation, or use of property of a railroad corporation, as defined in Section 230 of this code, shall be permitted, unless the Public Utilities Commission, after hearing, shall find and determine that the public interest and necessity require the abandonment, removal, relocation, or use of such property and that such taking or acquisition will not unreasonably impair the ability of the railroad corporation involved to provide safe, adequate, economical, and efficient service.
ARTICLE 2. Contracts [96030. - 96031.]
The district may make contracts and enter into stipulations of any nature whatsoever either in connection with eminent domain proceedings or otherwise, including, without limiting the generality of the foregoing, contracts and stipulations to indemnify and save harmless, to employ labor, and to do all acts necessary and convenient for the full exercise of the powers granted in this part.
No officer or employee of the district shall in any manner be interested, directly or indirectly, in any contract awarded or to be awarded by the board, or in the profits to be derived therefrom contrary to the provisions of Article 4 (commencing with Section 1090), Chapter 1, Division 4, Title 1 of the Government Code.
ARTICLE 4. Property [96090. - 96091.]
The district may take by grant, purchase, gift, devise or lease, or condemn in proceedings under eminent domain, or otherwise acquire, and hold and enjoy, real and personal property of every kind within or without the district necessary to the full or convenient exercise of its powers. The board may lease, mortgage, sell, or otherwise dispose of any real or personal property within or without the district when in its judgment it is for the best interests of the district so to do.
Whenever the board by resolution determines that any record, map, book, or paper in the possession of the district or any officer or employee thereof is of no further value to the district, the board may authorize its sale, destruction, or other disposition.
ARTICLE 5. Transit Facilities and Service [96120. - 96130.]
The district may acquire, construct, own, operate, control or use rights-of-way, rail lines, buslines, stations, platforms, switches, yards, terminals, and any and all other facilities necessary or convenient for transit service within or partly without the district, underground, upon, or above the ground and under, upon, or over public streets or other public ways or waterways, together with all physical structures necessary or convenient for the access of persons and vehicles thereto, and may acquire any interest in or rights to the joint use of any or all of the foregoing; provided, that installations in any street, road or other property devoted to a public use shall be subject to consent of the governing body in charge of such public use.
The district may without limitation by any other provisions of this part requiring approval of indebtedness, accept contributions of money, rights-of-way, labor, materials, and any other property for the acquisition, construction, maintenance and operation of transit facilities, and may without limitation by any other provisions of this part enter into any contracts and cooperation with and accept cooperation from the state, or any department, instrumentality, or agency thereof, or any public agency in the acquisition, construction, maintenance, and operation of, and in financing the acquisition, construction, maintenance, and operation of, any such transit facilities.
The district shall not interfere with or exercise any control over any transit facilities now or hereafter owned, and operated wholly or partly within the district by any city or public agency, unless by consent of such city or public agency and upon such terms as are mutually agreed upon between the board and such city or public agency.
The district may lease or contract for the use of its transit facilities, or any portion thereof, to any operator, and may provide for subleases by such operator upon such terms and conditions as it deems in the public interest. The word “operator” as used in this section means any city or public agency or any person, firm or private corporation.
The district may construct and operate or acquire and operate works and facilities in, under, upon, over, across, or along any street or public highway or any stream, bay or watercourse, or over any of the lands which are the property of the state, to the same extent that such rights and privileges appertaining thereto are granted to municipalities within the state, and to install adequate bus stops, including the painting of curbs, subject to the consent of the governing body in charge of such streets, highways, stream, watercourse or lands.
The district may enter into agreements for the joint use of any property and rights by the district and any city, public agency or public utility operating transit facilities; may enter into agreements with any city, public agency or public utility operating any transit facilities, either wholly or partially within, or without, the district, for the joint use of any property of the district or of such city, public agency or public utility, or the establishment of through routes, joint fares, transfer of passengers or pooling arrangements.
The rates and charges for service furnished pursuant to this part shall be fixed by the board and shall be reasonable.
The board of supervisors or the city council of a municipality having territory located within the district may file a request for a hearing before the district board as to the reasonableness of any rates or charges fixed by the district and as to any proposal for fixing the location of facilities by the district. The request shall be in writing and shall state the subject matter on which a hearing is desired.
Upon the filing of a request for hearing as provided in Section 96127 the district board shall fix the time and place for hearing. The time fixed shall not be less than 15 days nor more than 60 days from the date such request is filed. Notice of such hearing shall be given to the county or city requesting such hearing and shall be published by the board.
At the time fixed for any hearing before the board any board of supervisors or city council eligible to file a request for hearing, not a party to the original request for hearing, may intervene and shall be entitled to be heard and to introduce evidence.
Within 30 days after submission of the case, the board shall render its decision and its decision shall be final.
ARTICLE 6. Indebtedness [96150. - 96153.]
The district may borrow money for the purpose of defraying the expenses of the district lawfully incurred after the commencement of the fiscal year, but prior to the time moneys from the tax levy for the fiscal year are received by the district, in a sum which shall not exceed five cents ($0.05) on each one hundred dollars ($100) of assessed valuation of taxable property in the district at the time the moneys are borrowed, and may evidence such borrowing by notes bearing interest at a rate not to exceed 6 percent per annum. The notes shall be payable from the tax levy from the then current fiscal year, which levy shall contain a sum sufficient to provide for the payment of the notes and the interest thereon. The form of said notes and the proceedings relating to their issuance and sale, will be governed by the applicable provisions contained in Article 7 (commencing with Section 53820) of Chapter 4 of Part 1 of Division 2 of Title 5 of the Government Code.
The board of directors of a district may, within a period of two years from and after the formation of the district, pursuant to a resolution adopted by it for the purpose, borrow money on certificates of indebtedness, promissory notes, or other evidences of indebtedness, in anticipation of the estimated tax revenue for the following fiscal year, to be repaid within four years from the date of borrowing with interest at a rate not to exceed 6 percent per annum, in order to enable the district to meet all of its necessary initial expenses of organization, construction, acquisition, maintenance, and operation. The total amount of money borrowed and indebtedness incurred under this section during this two-year period shall not exceed 50 percent of the total amount of estimated tax revenue as estimated by the county auditor of the county in which the district lies for the following fiscal year.
The form of said notes and the proceedings relating to their issuance and sale, will be governed by the applicable provisions contained in Article 7 (commencing with Section 53820) of Chapter 4 of Part 1 of Division 2 of Title 5 of the Government Code.
The district shall not incur an indebtedness under Chapter 7 (commencing with Section 96400) of this part which in the aggregate exceeds two (2) percent of the assessed value of all the real and personal property within the district.
The district may accept, without limitation by any other provisions of this part requiring approval of indebtedness, contributions or loans from the United States, this state, or any department, instrumentality, or agency of either thereof, for the purpose of financing the acquisition, construction, maintenance, and operation of transit facilities, and may enter into contracts and cooperate with, and accept cooperation from, the United States, this state, or any department, instrumentality, or agency of either thereof, in the acquisition, construction, maintenance, and operation, and in financing the acquisition, construction, maintenance, and operation of any such transit facilities in accordance with any legislation which Congress or the Legislature of the State of California may have heretofore adopted or may hereafter adopt, under which aid, assistance, and cooperation may be furnished by the United States or this state in the acquisition, construction, maintenance, and operation or in financing the acquisition, construction, maintenance and operation of any such transit facilities. The district may do any and all things necessary in order to avail itself of such aid, assistance, and cooperation under any federal or state legislation now or hereafter enacted. Any evidence of indebtedness issued under this section shall constitute a negotiable instrument.
ARTICLE 7. Investments [96180. - 96192.]
The district may invest any surplus money in its treasury, including money in any sinking fund, in any of the following:
Its own bonds.
Treasury notes, certificates of indebtedness, bills, bonds of the United States, or any other evidence of indebtedness secured by the full faith and credit of the United States.
Obligations issued pursuant to the Federal Home Loan Bank Act or the National Housing Act.
Treasury notes or bonds of this state, or of any public corporation, municipal corporation, public district, or political subdivision within this state which are legal as security for the deposit of public funds.
Such investment may be made by direct purchase of any issue of such bonds, treasury notes, or obligations, or part thereof, at the original sale or by the subsequent purchase of the bonds, treasury notes, or obligations.
Any bonds, treasury notes, or obligations purchased and held as investments by the district may from time to time be sold and the proceeds reinvested in bonds, treasury notes, or obligations as provided in this article.
Sales of any bonds, treasury notes, or obligations purchased and held by the district shall from time to time be made in season so that the proceeds may be applied to the purposes for which the money with which the bonds, treasury notes, or obligations were originally purchased was placed in the treasury of the district.
ARTICLE 8. Taxation [96220. - 96230.]
The district may levy, and collect or cause to be collected, taxes for any lawful purpose subject to a maximum limit of five cents ($0.05) per one hundred dollars ($100) of assessed value of all real estate and personal property; provided however, the district shall have the further power to levy, collect or cause to be collected, said property taxes to a maximum limit of ten cents ($0.10) if approval is first obtained from the City Council of the City of Santa Barbara and the Board of Supervisors of the County of Santa Barbara.
If, in the opinion of the board, the transit operation revenues will not be sufficient for any and all lawful purposes the board shall levy a tax for such purpose or purposes and fix the amount of money necessary to be raised therefor by taxation.
The board shall, in addition to the general tax levy as set forth in Section 96220, levy and collect annually until the district’s bonds are paid, or until there is a sum in the treasury of the district set apart for that purpose to meet all sums coming due for principal and interest on the bonds as they become due a tax sufficient to pay the annual interest on the bonds and such part of the principal thereof as becomes due before the proceeds of a tax levied at the next general tax levy will be available. If the maturity of the indebtedness created by the issue of bonds begins more than one year after the date of the issuance thereof, the tax shall be levied and collected annually at the time and in the manner aforesaid, sufficient to pay the interest on the indebtedness as it falls due and to constitute a sinking fund for the payment of the principal on or before maturity.
The board may provide for the assessment, levy, and collection of taxes by the district, including the sale of property to the district for delinquent taxes, with penalties, interest, and cost.
The board shall avail itself of the assessments made by the assessor of the county and of the assessments made by the State Board of Equalization for the county and shall take such assessments as the basis for district taxation and have its taxes collected by the tax collector of the county.
In such case the county auditor shall, on or before the third Monday in August of each year, transmit to the board a statement in writing showing the total value of all property within the district, ascertained from the assessments referred to in Section 96224 as equalized.
The board shall, on or before the first day in September, fix the rate of taxes, designating the number of cents upon each hundred dollars, using as a basis the value of property transmitted to the board by the county auditor, which rate of taxation shall be sufficient to raise the amount previously fixed by the board. These acts by the board shall constitute a valid assessment of the property and a valid levy of the taxes so fixed, but the rate of taxation shall not exceed the limit imposed by this article.
The board shall immediately after fixing the rate of taxes as above provided transmit to the county auditor of the county a statement of the rate of taxes fixed by the board.
The district’s taxes so levied shall be collected at the same time and in the same manner as county taxes. When collected the net amount, ascertained as provided in this article, shall be paid to the treasurer of the district, under the general requirements and penalties provided by law for the settlement of other taxes.
Whenever any real property has been sold for taxes and has been redeemed, the money paid for redemption shall be apportioned and paid to the district by the county treasurer in the proportion which the tax due to the district bears to the total tax for which the property was sold.
The compensation to be charged by and paid to any county for the performance of services under this article shall be fixed by agreement between the board of supervisors of the county and the board. The compensation shall in no event exceed one-half of 1 percent of all money collected for the district. The compensation collected by the county shall be placed to the credit of the county general fund.
All taxes levied under this part are a lien on the property on which they are levied and shall become a lien at the same time as county taxes. The enforcement of the collection of such taxes shall be in the same manner and by the same means provided by law for the enforcement of liens for county taxes, all the provisions of law relating to the enforcement of the latter being made a part of this part so far as applicable.
CHAPTER 7. Bonds [96400. - 96591.]
ARTICLE 1. Issuance [96400. - 96412.]
The district may from time to time incur a bonded indebtedness as provided in this chapter to pay the cost of acquiring, constructing, or completing the whole or any portion of any transit facilities, or for acquiring any works, lands, structures, rights, equipment, or other property necessary or convenient to carry out the objects, purposes, or powers of the district.
Whenever the board by resolution passed by vote of two-thirds of all its members determines that the public interest or necessity demands the acquisition, construction, or completion by the district of any transit facilities or any works, lands, structures, rights, equipment, or other property necessary or convenient to carry out the objects, purposes, or powers of the district, the cost of which will be too great to be paid out of the ordinary annual income and revenue of the district, it may at any subsequent meeting of the board provide by ordinance for the submission of the proposition of incurring a bonded indebtedness for the purpose set forth in the resolution to the voters of the district at a special bond election held for that purpose.
In lieu of a resolution passed by the board, proceedings for the issuance of bonds for the purposes provided in this chapter may be initiated by petition of the voters of the district.
Whenever any petition signed by voters within the district equal in number to at least 15 percent of the total vote cast at the last general statewide election is presented to the board asking for the acquisition, construction, or completion of the whole or any portion of any transit facilities or for acquiring any works, lands, structures, rights, equipment, or other property necessary or convenient to carry out the objects, purposes, or powers of the district, and also asking that a bonded indebtedness be incurred to pay for the cost thereof, the secretary of the district shall immediately examine and verify the signatures of the petition and certify the result of the examination to the board.
If the required number of signatures is found to be genuine, the secretary shall transmit to the board an authentic copy of the petition without the signatures.
Upon receiving a petition with the certificate of the secretary stating that it contains the required number of signatures, the board shall formulate for submission to the voters of the district at a special bond election called for that purpose the proposition of incurring a bonded indebtedness for the purposes set forth in the petition. In its discretion the board may defer the calling of the election until the next general election to be held in the district in order to consolidate them.
The ordinance calling a special bond election shall fix the date on which the election will be held, and the manner of holding the election and of voting for or against incurring the indebtedness. It shall also recite the objects and purposes for which the indebtedness is proposed to be incurred, the estimated cost of the transit facilities, works, lands, structures, rights, equipment, or other property proposed to be acquired, constructed, or completed, the amount of the principal of the indebtedness to be incurred therefor, and the maximum rate of interest to be paid on the indebtedness, which shall not exceed 6 percent per annum, payable semiannually or annually the first year and thereafter semiannually.
Propositions for incurring indebtedness for more than one object or purpose may be submitted at the same election.
Any special bond election may be held separately, or may be consolidated with any other election authorized by law at which the voters of the district may vote. If a special bond election is consolidated with any other election, the provisions of this chapter setting forth the procedure for the calling and holding of the special bond election shall be complied with, except that the ordinance calling the election need not set forth the election precincts, polling places, and officers of election, but may provide that the precincts, polling places, and officers of election shall be the same as those set forth in the ordinance, notice, or other proceedings calling the election with which the special bond election is consolidated, and shall refer to the ordinance, notice, or other proceedings by number and title, or by other definite description.
The ordinance shall be published, and no other notice of election need be given.
The board shall comply with Article 3, (commencing with Section 9160) of Chapter 2 of Division 9 of the Elections Code, the provisions of which are applicable to any bond election held pursuant to this article. Wherever the words “county clerk” or “county elections official” appear in the Elections Code the words “secretary of the board” shall be substituted, for the purposes of this article, and wherever the words “board of supervisors” appear in the Elections Code, the words “board of directors” shall be substituted, and wherever the words “district attorney or county counsel” appear in the Elections Code, the words “attorney for the district” shall be substituted.
The votes of two-thirds (23) of all the voters voting on the proposition at the election are required to authorize the issuance of bonds under this chapter.
If the proposition submitted at a special bond election fails to receive the requisite number of votes, the board shall not within six months after the election hold another special election for the submission of a proposition of incurring a bonded indebtedness substantially the same as the proposition voted upon at the prior election unless a petition signed by voters within the district equal in number to at least 15 percent of the total vote cast at the last general statewide election is filed with the board, requesting that the proposition, or a proposition substantially the same, be submitted at an election to be called for that purpose.
ARTICLE 2. Form and Content [96440. - 96443.]
Bonds authorized by this chapter shall mature serially in amounts to be fixed by the board; except that payment shall begin not later than 10 years from the date thereof and shall be completed in not more than 50 years from that date.
The board may divide any issue of bonds authorized pursuant to this chapter into two or more series, and may fix different dates of issuance and different maturity dates for the bonds of each series. The bonds of each series shall mature serially in amounts to be fixed by the board, and the board shall fix a date not more than 10 years from the date of issuance of each series for the earliest maturity of such series, and shall fix a date not more than 50 years from the date of issuance of each series for the final maturity of such series.
Pending the actual issuance or delivery of bonds, a district may issue temporary or interim bonds, certificates, or receipts, of any denomination whatsoever, with or without coupon, and in such form as may be prescribed by the board, to be exchanged for definite bonds when ready for delivery.
The bonds shall be issued in such denominations as the board determines, except that no bonds shall be of a denomination less than one hundred dollars ($100), nor of a greater denomination than one thousand dollars ($1,000) or any multiple thereof, and shall be payable on the day and at the place or places fixed in the bonds, and with interest at the rate specified therein, payable semiannually.
The board may at any time prior to the issuance and sale of any bonds provide for the call and redemption of any or all of the bonds on any interest payment date prior to their fixed maturity at not exceeding the par value and accrued interest plus a premium of not exceeding 5 percent upon the principal amount of the bonds, in which event the call price fixed by the board shall be set forth on the face of the bond. Notice of such redemption shall be published. If there is no newspaper of general circulation printed and published within the district, then the publication shall be made in a newspaper of general circulation printed and published within the county in which the district or any part thereof is situated. The first publication shall be at least 30 days prior to the date fixed for the redemption. After the date fixed for such redemption interest on the bonds thereafter shall cease.
The bonds shall be signed by the president of the board or by such officer of the district as the board shall by resolution authorize and designate for that purpose. They shall also be signed by the treasurer, and be countersigned by the secretary. The coupons of the bonds shall be numbered consecutively and be signed by the treasurer. All signatures and countersignatures, except one of the signatures or countersignatures on the bonds, may be printed, lithographed, or engraved. If any officer whose signature or countersignature appears on the bonds or coupons ceases to be such officer before the delivery of the bonds to the purchaser, the signature or countersignature is nevertheless valid and sufficient for all purposes as if he had remained in office until the delivery of the bonds.
ARTICLE 3. Issue and Sale [96470. - 96472.]
The bonds may be issued and sold for not less than their par value, but otherwise as the board determines. Before selling any bonds, or any part thereof, the board shall give notice inviting sealed bids in such manner as the board may prescribe. If satisfactory bids are received, the bonds offered for sale shall be awarded to the highest responsible bidder. If no bids are received, or if the board determines that the bids received are not satisfactory as to price or responsibility of the bidders, the board may reject all bids received, if any, and either again give notice inviting bids or sell the bonds at private sale.
All premiums and accrued interest received on the sale of bonds shall be placed in the fund to be used for the payment of principal of and interest on the bonds. The remainder of the proceeds of the bonds shall be placed in the district treasury to the credit of the proper fund, and shall be used exclusively for the objects or purposes for which the bonds were voted; provided that when such objects and purposes have been accomplished any moneys remaining shall be transferred to the fund to be used for the payment of principal of and interest on the bonds, and that when all principal of and interest on the bonds shall have been paid, any balance of money then remaining shall be transferred to the general fund of the district.
In lieu of the immediate levy of a tax to pay the interest or any part thereof on any bonded indebtedness incurred in accordance with this division, the board may in the estimate of the amount of money necessary to be raised by the bonds include a sum sufficient to pay interest on all of the bonds or part thereof during the period of acquisition, construction, or completion, but for no period in excess of five years.
ARTICLE 4. Refunding [96500. - 96506.]
Whenever the board by resolution passed by a vote of two-thirds of all its members determines that the refunding of the whole or any portion of the bonded indebtedness will be of advantage to the district the board may refund the bonded indebtedness or any portion thereof and issue refunding bonds of the district therefor.
The issuance of refunding bonds shall not be construed as the incurring or increase of an indebtedness within the meaning of this act, and the approval of the voters is not required for the issuance of refunding bonds. The board may provide for the call and redemption of any or all of the bonds on any interest payment date prior to their fixed maturity in the ordinance authorizing the issuance of the refunding bonds.
Except as otherwise provided, the provisions of this chapter shall substantially govern as to all matters pertaining to the issuance of refunding bonds, including and without limiting the generality of the foregoing, the form, execution, issuance, maturity, redemption, refunding, validation, the payment of interest from bond funds, and the status of the bonds as investments.
Refunding bonds shall bear interest at a rate not exceeding the interest rate on the refunded bonds, but payment of the refunding bonds shall begin not later than one year from the date thereof and be completed in not more than 40 years from that date.
The proceeds of the sale of refunding bonds shall be applied only to the purchase, or retirement at not more than par and accrued interest, or the call price, of the bonded indebtedness for which the refunding bonds were issued.
In lieu of selling refunding bonds and using the proceeds to purchase or retire the bonds to be refunded, the board may exchange refunding bonds at not less than par and accrued interest for the bonds so refunded.
Whenever outstanding bonds are refunded they shall be surrendered to the treasurer of the district, who shall cancel them by endorsing on their face the manner in which the refunding was effected (whether by exchange or purchase, and the amount for which so purchased, if any) and by perforating through each bond and each coupon attached thereto the word “canceled” together with the date of cancellation.
ARTICLE 5. Status as Investments [96530. - 96531.]
All bonds including refunding bonds issued by a district are legal investments for all trust funds and for the funds of all insurance companies, banks, both commercial and savings, and trust companies, and for the State School Fund and for all sinking funds under the control of the State Treasurer. Whenever any money or funds may by law be invested in or loaned upon the security of bonds of cities, cities and counties, counties, or school districts, in the state, such money or funds may be invested in or loaned upon the security of the bonds of the district; and whenever bonds of cities, cities and counties, counties, or school districts by law may be used as security for the faithful performance or execution of any court or private trust or of any other act, bonds of the district may be so used.
All bonds of the district, to the same extent as bonds of any other municipality, are legal for use by any state or national bank or banks in the state as security for the deposit of funds of the state or of any county, city and county, city, municipality, or other public or municipal corporation within the state.
ARTICLE 6. Validation [96560. - 96560.]
An action to determine the validity of bonds, including refunding bonds, may be brought pursuant to Chapter 9 (commencing with Section 860) of Title 10 of Part 2 of the Code of Civil Procedure.
ARTICLE 7. Revenue Bonds [96590. - 96591.]
As an alternative procedure for the raising of funds, the district may issue bonds, payable from revenues of any facility or enterprise to be acquired or constructed by the district, in the manner provided by the Revenue Bond Law of 1941 (Chapter 6 (commencing with Section 54300) of Part 1 of Division 2 of Title 5 of the Government Code), all of the provisions of which are applicable to the district.
The district is a local agency within the meaning of the Revenue Bond Law of 1941 (Chapter 6 (commencing with Section 54300) of Part 1 of Division 2 of Title 5 of the Government Code). The term “enterprise” as used in the Revenue Bond Law of 1941 shall, for all purposes of this part, include transit facilities and any and all parts thereof and all additions, extensions and improvements thereto and all other facilities authorized to be acquired, constructed or completed by the district. A district may issue revenue bonds under the Revenue Bond Law of 1941, for any one or more facilities or enterprises authorized to be acquired, constructed, or completed by a district or, in the alternative, may issue revenue bonds under the Revenue Bond Law of 1941, for the acquisition, construction and completion of any one of such facilities. Nothing in this article shall prevent the district from availing itself of, or making use of, any procedure provided in this part for the issuance of bonds of any type or character for any of the facilities or works authorized hereunder, and all proceedings may be carried on simultaneously or, in the alternative, as the directors may determine.
CHAPTER 8. Annexation [96750. - 96757.]
Territory may be annexed to the district in the manner provided in this chapter.
Whenever the board finds and determines that additional territory will be benefited by annexation to the district, it shall pass a resolution to that effect.
The resolution shall be passed by a vote of two-thirds of the members of the board and be approved by the board of supervisors of the county in which the territory is situated.
The resolution shall:
Describe the boundaries of the territory proposed to be annexed.
Designate the proposed annexation by an appropriate name.
Declare that the area to be annexed to the district will be benefited by such annexation.
Name the time and place for the hearing of objections by any person interested in the proposed annexation.
The resolution, together with the names of the members of the board, voting for and against it shall be published pursuant to Section 6066 of the Government Code in a newspaper published in the territory proposed to be annexed, or if there is no such paper, then in some newspaper of general circulation, circulated in such territory.
On the day fixed for hearing or any day to which the hearing is adjourned, the board shall hear and consider any objections presented to the annexation of the territory. After the hearing of objections, if it shall be determined by a vote of two-thirds of all the members of the board that the territory proposed to be annexed will be benefited by such annexation, the board shall proceed to fix and determine the boundaries of the territory to be annexed to the district.
After making all necessary and proper changes in the boundaries, by a resolution passed by a vote of two-thirds of the members, the board shall order the annexation of the territory so described. The resolution, together with the names of the members of the board voting for and against the same shall be spread upon the minutes of the board.
Whenever any territory is annexed to the district it shall thereupon become a part of the district subject to all the liabilities and entitled to all the benefits of the district.
CHAPTER 9. Exclusion [96900. - 96902.]
Territory within the district may be detached from the district by a four-fifths vote of the board of directors.
The detachment of territory from the district shall become effective upon giving of the notice required in Section 96902, provided that the detached territory shall not be relieved from liability for taxation for the payment of any bonded indebtedness existing at the time of detachment.
Notice of detachment of territory from the district shall be given to each assessor whose roll is used for the tax levy made pursuant to this part and with the State Board of Equalization pursuant to Government Code Sections 54900 et seq.
CHAPTER 10. Dissolution [97000. - 97007.]
If the district operates no transit facilities, or its exterior boundaries become coincident with the boundaries of a single city, the board may call an election at any time for the purpose of submitting to the voters of the district the question of whether the district will be dissolved. Upon the filing with the secretary of the district of a petition signed by voters within the district equal in number to at least 25 percent of the total vote cast at the last general statewide election, asking that the question of dissolution of the district be submitted to the voters of the district, the board shall call such an election.
The election for the purpose of submitting to the voters of the district the question of whether or not the district shall be dissolved shall be held within 60 days next succeeding the date on which the petition is filed.
Notice of any election for dissolution, whether called because of the filing of a petition or ordered by the board without petition, shall be published. The date fixed for the election shall not be less than 30 days from the date of the first publication of the notice.
The ballots for the election shall contain substantially the instructions required to be printed on ballots for use at general state and county elections and in addition the following:
The board shall canvass the vote. If a majority of the votes favor dissolution, the board shall by resolution dissolve the district.
The board shall file a certified copy of the resolution with the Secretary of State and for record in the office of the county recorder.
Upon dissolution the right, title, and interest to property owned or controlled by the district situated within the limits of any city vests absolutely in the city. If such property is situated outside the limits of a city, it vests in the county in which it is situated.
The board of supervisors is, ex officio, the governing body of any dissolved district. It may levy taxes and assessments and perform other acts necessary to wind up the district affairs and to raise money for the payment of outstanding indebtedness.
PART 10. SANTA CRUZ METROPOLITAN TRANSIT DISTRICT [98000. - 98407.]
CHAPTER 1. General Provisions [98000. - 98014.]
ARTICLE 1. Definitions [98000. - 98007.]
This part shall be known and cited as the “Santa Cruz Metropolitan Transit District Act of 1967.”
Unless the context otherwise requires, the provisions of this article govern the construction of this part.
“District” means the Santa Cruz Metropolitan Transit District formed under this part.
“Board” means the board of directors of this district.
“Voter” means any elector who is registered under the Elections Code.
“Transit” means the transportation of passengers only and their incidental baggage by means other than by chartered bus, sightseeing bus, or any other motor vehicle not on an individual fare-paying basis, and includes rapid transit. Nothing in this section shall be construed to prohibit the district from leasing its buses to private certified public carriers or to prohibit the district from providing schoolbus service for the transportation of pupils between their homes and schools.
“Transit works” or “transit facilities” means all real and personal property equipment, rights, or interests owned or to be acquired by the district for transit service.
“Officer” means the general manager and the directors on the board.
ARTICLE 2. General Provisions [98010. - 98014.]
It is necessary that a transit district be established in the Santa Cruz metropolitan area which includes the Cities of Santa Cruz and Capitola and adjacent unincorporated territory in order to remedy the public transit problem of the area. The geographic location of the city in relation to the adjacent unincorporated territory requiring transportation services makes it necessary to develop a single transit system to protect the public interest and welfare.
The Santa Cruz Metropolitan Transit System may be created as provided in this part and when so created may exercise the powers herein granted.
Except as otherwise provided in this part elections shall be held and conducted and the result ascertained, determined, and declared in all respects as nearly as practicable in conformity with the general election laws of the state.
Except as otherwise provided in this part all ordinances and notices which are required to be published shall be published within the district pursuant to Section 6066 of the Government Code.
Whenever the signature of any officer or employee of a district or of any member of the retirement board or of any officer or employee of the retirement system is authorized or required under the provisions of this part, except in the single instance provided in Section 98335, the signature may be made by the use of a plate bearing facsimiles of such signatures.
CHAPTER 2. Formation of District [98020. - 98080.]
ARTICLE 1. General Provisions [98020. - 98022.]
The County of Santa Cruz may organize and incorporate the Santa Cruz Metropolitan Transit District.
The request for the formation of the Santa Cruz Metropolitan Transit District may be made by resolution or by petition as set out in this chapter.
The district may include incorporated and unincorporated territory within the County of Santa Cruz.
ARTICLE 2. Request by Resolution [98030. - 98032.]
The Board of Supervisors for the County of Santa Cruz, the Santa Cruz City Council and the Capitola City Council may pass a joint resolution, declaring that in their opinion, public interest or necessity demands the creation and maintenance of the Santa Cruz Metropolitan Transit District.
The resolution may state the transit facilities proposed to be first acquired, but failure to acquire such transit facilities shall not affect the validity of the district. The resolution shall set forth and describe the boundaries of the proposed district.
Certified copies of the resolution shall be presented to the Board of Supervisors of Santa Cruz County requesting the board of supervisors to call an election without delay for determining whether the district will be created.
ARTICLE 3. Request by Petition [98040. - 98043.]
Instead of a resolution, a petition may be presented to the board of supervisors signed by voters within the proposed district equal in number to at least 25 percent of the total vote cast at the last general election.
The petition shall contain substantially the same declarations and statements required to be contained in the resolution presented to the board of supervisors under this chapter, including the description of the boundaries, and declare that, in the opinion of the petitioners, public interest or necessity demands the creation and maintenance of the metropolitan transit district.
The petition may be on separate papers, but each paper shall contain the affidavit of the person who circulated it certifying that each name signed thereto is a true signature of the person whose name it purports to be.
The County Elections Official of the County of Santa Cruz shall compare the signatures to the petition with the affidavits of registration and certify to their sufficiency or insufficiency.
ARTICLE 4. Election [98050. - 98060.]
Upon adoption of the resolution or of a sufficient petition, the board of supervisors shall hold a hearing on the question of forming a Santa Cruz Metropolitan Transit District. All interested persons shall be given an opportunity to express their views at the hearing.
The board of supervisors shall submit the boundaries for the district as described in the resolution or petition to the local agency formation commission for review. The local agency formation commission shall have the authority to adjust the boundaries so as to exclude areas which would not receive reasonable benefit from inclusion in the district, but no incorporated area shall be divided so that part of it is within and part outside the district.
Upon conclusion of the board of supervisors’ hearing and completion of the review of the boundaries for the proposed district by the local agency formation commission, the board of supervisors shall in case of initiation by petition of voters and in case of initiation by resolution call an election within the proposed district for the purpose of determining whether the proposed district will be created and established.
Prior to calling the election, the board of supervisors shall by resolution, entered upon its minutes:
Fix and describe the exterior boundaries of the proposed district as determined by the local agency formation commission.
Fix the date on which an election will be held in the proposed district and the hours during which the polls will be open.
State the purpose for which the election is held.
The election shall be held not less than 60 days nor more than 90 days from the date of the adoption of the resolution prescribed by Section 98030.
The election shall be called by publishing notice calling the election pursuant to Section 6066 of the Government Code not less than 20 days before the election. Said notice need only specify the time and place of the election, the hours during which the polls will be open, the purpose of the election, and the description of the exterior boundaries of the proposed district as determined by the board of supervisors.
The ballot for the election shall contain such instructions as are required by law to be printed thereon and in addition thereto the following:
No person shall be entitled to vote at the election unless he is a voter of the territory included in the proposed district.
The election may be held on the same day as any other state, county, or city election, and be consolidated therewith.
The board of supervisors shall meet on the Tuesday next succeeding the day of the election and canvass the returns.
The board of supervisors shall make all provisions for the holding of the election throughout the district as proposed, and the cost of said election shall be a charge against the general funds of the county.
If any special election is held exclusively on the proposition or propositions related to the transit district organization, bond issuance, raising of tax levy, or any other transit district purpose, the expenditures therefor shall be reimbursed to the county by means of a tax on all the taxable property within the district, and this tax shall be added to the next county tax bills by the proper official of the county.
ARTICLE 5. Establishment of the District [98070. - 98070.]
If a majority of the electors voting on the proposition vote in favor of the creation and establishment of the district, the board of supervisors shall cause a certified copy of the order declaring the result of the election to be filed in the office of the Secretary of State, from and after which the establishment of the district shall be deemed complete.
ARTICLE 6. Contest of Incorporation [98080. - 98080.]
No informality in any proceeding or in the conduct of the election, not substantially affecting adversely the legal rights of any citizen, shall be held to invalidate the incorporation of the district. Any proceedings wherein the validity of incorporation is denied shall be commenced within three months from the date of filing the order declaring the result of the election with the Secretary of State, otherwise the incorporation and the legal existence of the district shall be held to be valid and in every respect legal and incontestable.
CHAPTER 3. Internal Organization of District [98100. - 98149.]
ARTICLE 1. Government [98100. - 98106.]
The district shall be governed by a board of directors of seven members, which may be increased to 9 or 11 members if the board finds that an increase in the membership of the board is necessary to insure adequate representation to all of the areas in the County of Santa Cruz served by the district. The membership shall be composed of one member appointed by the City Council of Santa Cruz, one member appointed by the City Council of Capitola, one member appointed by the City Council of Scotts Valley, one member appointed by the City Council of Watsonville, one member appointed by the governing bodies of any other incorporated areas in the county within the district to represent those incorporated areas, one member appointed by the Board of Supervisors of the County of Santa Cruz, and other members to be appointed by the above entities in accordance with their proportionate population within the district. However, the membership of the board shall not exceed the number determined by the board.
The apportionment shall be based upon the population distribution within the district, and the board shall reapportion its membership whenever any part of the district is excluded or new territory is added or unincorporated territory within the district incorporates, and, as a result of the exclusion, annexation, or incorporation, representation on the board no longer reflects the population distribution within the district. The board shall also reapportion whenever the county elections official advises the board that the latest official census indicates a need for reapportionment.
The appointees to the board made by the several legislative bodies shall have been residents of the area encompassed by the district for at least 30 days prior to their appointment, and they shall also be residents of the city whose city council appointed them or, a resident of the county if appointed by the board of supervisors.
These appointments shall be made within 30 days after the formation of the district.
A person shall not be appointed to, or be a member of, the board unless that person is a resident of the district and has resided within the district at least 30 days immediately prior to his or her appointment to the board.
Except as otherwise provided in this section, the term of office of each director shall be four years.
For the board first appointed, at least one appointee of each legislative body shall have a two-year term.
If the appointee of any legislative body is one of its own members and the appointee leaves the legislative body, the appointee may continue to serve as appointee until a qualified successor is appointed, unless the legislative body takes express action to unseat the appointee.
An appointment to fill a vacancy on the board, or an appointment made after the expiration of the preceding term, shall be for the unexpired portion of the term.
The failure of a board member to attend three consecutive meetings of the board without good cause shall create a vacancy in the office of the board member.
Each member of the board shall be reimbursed for the actual and necessary expenses incurred in the performance of the board member’s duties, including for attending each meeting of the board and each committee meeting, as determined by the board. A board member’s reimbursement for attending a meeting shall not exceed one hundred dollars ($100), and each member’s reimbursements shall not exceed four hundred dollars ($400) in any month.
The first meeting of the board shall be held within 10 days of the appointment of the last director by a legislative body. The board shall make its own rules of procedure and determine the place and time of its meetings.
The board shall select one of its members chairman, and one vice chairman, who shall preside in the absence of its chairman. The board shall provide for and select a secretary and such other officers as it deems necessary to conduct the affairs of the district.
ARTICLE 2. Powers and Duties of Directors [98110. - 98119.]
The chairman is the presiding officer of the board.
All matters and things necessary for the proper administration of the affairs of the district which are not provided for in this part shall be provided for by the board.
The board shall supervise and regulate every transit facility owned and operated by the district, including the fixing of rates, rentals, charges and classifications, and the making and enforcement of rules, regulations, contracts, practices, and schedules, for or in connection with any transit facility owned or controlled by the district.
The board may either operate the transit system itself or a part thereof or it may contract with any other public or private agency or corporation to operate all or part of the transit system for the district or it may contract with any other public or private agency or corporation for the improvement in transit services, facilities, equipment or operations being operated and conducted by said agency or corporation in, and, or, out of, the district.
The board may adopt a personnel system for the purpose of recruiting and maintaining an effective working force with good morale. The board shall by resolution determine and create such number and character of positions as are necessary properly to carry on the functions of the district and shall establish an appropriate salary, salary range, or wage for each position so created. The board may by resolution abolish any such position. Except as otherwise provided, appointments to such positions shall be made by the general manager.
The board may from time to time contract for or employ any professional service required by the district or for the performance of work or services which cannot satisfactorily or economically be performed by the regular employees of the district.
The board shall have an annual audit of all books and accounts of the district made by a certified public accountant or public accountant or by the county auditor, for whose services the county will be reimbursed. A copy of the annual audit shall be sent to the board of supervisors and to the city council of each city within the district.
The board may provide by resolution, under such terms and conditions as it sees fit, for the payment of demands against the district without prior specific approval thereof by the board if the demand is for a purpose for which an expenditure has been previously approved by the board and in an amount no greater than the amount so authorized, and if the demand is approved by the general manager.
To facilitate the business of the district, the board may provide for the creation and administration of such funds as the needs of the district may require. The funds shall be disbursed in accordance with rules established by the board and all payments from any fund shall be reported to the board.
None of the territory which is within the district shall be annexed to any other transit district unless the board, by resolution, approves the annexation of such territory to such other transit district.
ARTICLE 3. Meetings and Legislation [98130. - 98135.]
All meetings of the board shall be conducted in a manner prescribed by the Ralph M. Brown Act, Chapter 9 (commencing with Section 54950), Part 1, Division 2, Title 5 of the Government Code.
A majority of the board constitutes a quorum for the transaction of business.
The board shall establish rules for its proceedings and board members shall be allowed necessary traveling and personal expenses incurred in performance of duties authorized by the board.
The acts of the board shall be expressed by motion, resolution or ordinance. No ordinance shall be passed until a public hearing has been held on it, which hearing shall be advertised in a newspaper of general circulation or posted in at least three public places at least 15 days prior to the hearing. No ordinance shall be adopted by the board on the day of its introduction, and no ordinance, resolution or motion shall have any validity or effect unless passed by the affirmative votes of a majority of the directors.
All ordinances shall be printed after passage, and maintained in the district’s offices.
The enacting clause of all ordinances shall be as follows:
“Be it enacted by the Board of Directors of the Santa Cruz Metropolitan Transit District:” All ordinances shall be signed by the chairman of the board or the vice chairman and attested by the secretary.
ARTICLE 4. Other Offices [98140. - 98149.]
The board may, by an affimative vote of the majority of its members, appoint and fix the salary of a general manager, who shall have the responsibility for the proper administration of the district in accordance with state law and such ordinances, resolutions and policies as may be established by the board.
The general manager shall not be a member of the board, nor shall he have been a member of the board within the year immediately preceding his appointment.
The general manager may be removed by the board upon the adoption of a resolution by the affirmative vote of not less than a majority of the board. The board may not reduce the salary of the general manager below the amount fixed at the time of his original appointment except upon the adoption of a resolution by a like vote. The action of the board in suspending or removing the general manager or reducing his salary, if approved by a majority of the membership of the board, is final.
The oath of all appointive officers of the district shall be taken, subscribed, and filed with the secretary of the district at any time after the officer has notice of his appointment but not later than 15 days after the commencement of his term of office. No other filing is required.
Each appointive officer shall give such bond and in such amount as the board may require.
The board shall establish by resolution the powers and duties of the general manager.
The general manager shall prepare, within 90 days from the end of each fiscal year, a financial report showing the result of operations for the preceding fiscal year and the financial status of the district on the last day thereof. A copy of this report shall be delivered to the board of supervisors, each city council within the district, and a copy shall be made available to the public.
At least 30 days prior to the end of the fiscal year, the general manager shall prepare a proposed annual budget for the district. Prior to the time this budget is formally adopted by the board, copies thereof will be sent to the board of supervisors and each city council within the district.
The general manager shall provide for the custody of the funds of the district and the keeping of accounts of all receipts and disbursements. Payments shall be made only upon warrants duly and regularly signed by the chairperson or vice chairperson of the board, or other person authorized by the board to do so, and by the general manager or secretary. Alternatively, the board may request the Auditor of the County of Santa Cruz to audit, allow, and draw warrants on the district treasury for all legal claims presented to the county auditor and approved by a majority of the board, and the treasurer shall pay those warrants in the order in which they are presented.
With the consent of the board, the general manager may:
Authorize the trust department of any state or national bank in this state, or a trust company authorized to act as such in this state, to receive as his agent deposits of any securities acquired by the district.
Place and maintain for safekeeping as a trust deposit with the trust department of any state or national banks in this state, or a trust company authorized to act as such in this state, any securities owned by the district.
The bank or trust company, selected, shall have a total paid-in capital of at least one million dollars ($1,000,000). The general manager shall take from the trust department or trust company a receipt for the securities, and neither the general manager nor the district is responsible for the custody and safe return of the securities until they are withdrawn from the trust department or trust company by the general manager. Any trust department or trust company to which securities are delivered, either as agent or depository for the general manager, shall make such deposition of the securities as the general manager directs and is responsible only for strict compliance with written instructions given to it by the general manager. All such securities are at times subject to the order of the general manager.
The board may appoint a regular attorney who shall serve at the pleasure of the board or it may engage an attorney from time to time as the need arises. If they declare themselves available, the county counsel or the attorneys for any of the cities within the district shall be eligible to provide legal advice to the board at a reasonable rate of compensation.
CHAPTER 4. Labor Provisions [98160. - 98174.]
For purpose of this chapter, the following definitions apply:
“District” means the Santa Cruz Metropolitan Transit District, including all operations and extensions of its transportation system, regardless of modality or vehicle type.
“Employee organization” means an organization that includes employees of the district and a primary purpose of which is representing those employees in their relations with the district. “Employee organization” also includes any person of an employee organization authorized to act on its behalf.
“Exclusive representative” means an accredited employee organization recognized or certified as the exclusive negotiating representative of employees in an appropriate unit within the district.
It is a primary purpose of this chapter to promote the improvement of personnel management and employer-employee relations within the district by providing a uniform basis for recognizing the right of employees to join employee organizations of their own choice, to be represented, to select one employee organization as the exclusive representative of the employees in an appropriate unit, and to afford employees a voice at work.
Appointments and promotions in the service of the transit district shall be made according to merit and fitness, to be ascertained, in so far as is practicable, by competitive examination.
All individuals shall have equal opportunity to obtain and hold employment, and to advance in that employment, without discrimination on any basis listed in subdivision (a) of Section 12940 of the Government Code, as those bases are defined in Sections 12926 and 12926.1 of the Government Code, except as otherwise provided in Section 12940 of the Government Code.
An employee shall not be subject to punitive action, denied promotion, or threatened with that treatment for the exercise of lawful action as an elected, appointed, or recognized representative of an employee bargaining unit.
All employees of the district are to be free from interference, coercion, and restraint in associating themselves together for their mutual benefit in connection with their employment. They may designate representatives of their own choosing and, collectively or individually, may exercise their right of petition to the board concerning wages, hours, or other conditions of employment.
Employees have the right to self-organization; to form, join, or assist labor organizations; and to bargain collectively through representatives of their own choosing for the purpose of collective bargaining.
Any question that may arise with respect to whether a majority of the employees in an appropriate unit desire to be represented by a labor organization shall be submitted to the director of the California State Mediation and Conciliation Service, a division within the Public Employment Relations Board.
In resolving the questions of representation, including the determination of the appropriate unit or units, petitions, and the conduct of hearings and elections, the director shall apply the relevant federal law and administrative practice developed under the Labor Management Relations Act, 1947 (29 U.S.C. Sec. 141 et seq.), as amended, and for this purpose shall adopt appropriate rules and regulations. The rules and regulations shall be administered by the California State Mediation and Conciliation Service and shall provide for a prompt public hearing and a secret ballot election to determine the question of representation.
Whenever any district acquires existing facilities from a publicly or privately owned public utility either in proceedings by eminent domain or otherwise, to the extent necessary for operation of facilities, all of the employees of such public utility whose duties pertain to the facilities acquired who have been employed by said utility for at least seventy-five (75) days shall be appointed to comparable positions in the district without examination and shall be governed thereafter by the personnel system adopted by the board, and these employees shall be given sick leave, seniority, and vacation credits in accordance with the records of the acquired public utility.
The provisions of this section shall apply only to those officers or supervisory employees of the acquired utility as shall be designated by the board.
Whenever any district acquires existing facilities from a publicly or privately owned public utility, either in proceedings in eminent domain or otherwise, that has a pension plan in operation, members and beneficiaries of such pension plan shall continue to have the rights, privileges, benefits, obligations and status with respect to such established system.
Whenever any such facilities are acquired by the district, the board shall consider and take into account the outstanding obligations and liabilities of the publicly or privately owned public utility by reason of such pension plan and shall negotiate an allowance in the purchase price of such utility for the assumption of such obligations and liabilities when acquiring the facilities.
The persons entitled to pension benefits as provided for in Chapter 5 (commencing with Section 98180) of this part and the benefits which are provided shall be specified in the agreement or order by which any public utility is acquired by the district.
All persons receiving pension benefits from such acquired public utility and all persons entitled to pension benefits under the pension plan of such acquired public utility may become members or receive pensions under the retirement system established by the district by mutual agreement of such persons and the district.
Notwithstanding the Government Code, the board may authorize payment of any or all of the premiums on any group life, accident and health insurance, health and welfare plan, or pension or retirement plan on officers or employees of the district.
Upon authorization by its employees, the district may make deductions from the wages and salaries of its employees:
For the payment of contributions pursuant to any health and welfare, pension, or retirement plan.
For any purpose for which deductions may be authorized by employees of any private employer.
For the payment of union dues, fees, assessments, and voluntary political contributions.
The obligation of the district is to bargain in good faith with a duly designated or certified labor organization and, when an agreement is reached, to execute a written collective bargaining agreement with the labor organization covering the wages, hours, and working conditions of the employees represented by the labor organization in an appropriate unit, and, thereafter, to comply with the terms of the agreement.
The obligation of the district to bargain collectively extends to all subjects of collective bargaining concerning wages, hours, working conditions, and other conditions of employment.
This section supersedes Chapter 10 (commencing with Section 3500) of Division 4 of Title 1 of the Government Code if there is any conflict between this section and that chapter, but in all other situations that chapter governs.
The district shall give reasonable written notice to an exclusive representative of its intent to make any change to matters within the scope of representation of the employees represented by the exclusive representative for purposes of providing the exclusive representative a reasonable amount of time to negotiate with the district regarding the proposed changes.
The district shall not require any employee, who is a member of a bona fide religion, body, or sect which has historically held conscientious objections to joining or financially supporting labor organizations, to join or financially support any public employee labor organization as a condition of employment. However, that employee may be required, in lieu of paying periodic dues, fees, or assessments to a labor organization, to pay sums equal to those dues, fees, or assessments to a nonreligious, nonlabor charitable fund exempt from taxation under Section 501(c) (3) of the Internal Revenue Code (26 U.S.C. Sec. 501(c) (3)), chosen by the employee from a list of at least three qualifying funds, designated in a memorandum of understanding between the district and the labor organization or, if the memorandum of understanding fails to designate the funds, then to any qualifying fund chosen by the employee. Proof of payments made pursuant to this section shall be made on a monthly basis to the district as a condition of continued exemption from the requirement of financial support to a labor organization.
An exclusive representative may represent their bargaining unit members in employer-employee relations with the district, and employees shall have the right to be represented by their exclusive representative.
It is unlawful for the district to do any of the following:
Impose or threaten to impose reprisals on employees, to discriminate or threaten to discriminate against employees, or otherwise to interfere with, restrain, or coerce employees because of their exercise of rights guaranteed to them by this chapter. As used in this subdivision, “employee” includes an applicant for employment or reemployment with the district.
Deny employee organizations rights guaranteed to them by this chapter.
Refuse or fail to meet and negotiate in good faith with an exclusive representative. Knowingly providing an exclusive representative with inaccurate information, whether or not it is in response to a request for information, constitutes a refusal or failure of the district to meet and negotiate in good faith with the exclusive representative.
Dominate or interfere with the formation or administration of any employee organization, or contribute financial or other support to it, or in any way encourage employees to join any employee organization in preference to another.
Refuse to participate in good faith in mutually agreed upon impasse procedures.
It is unlawful for an employee organization to do any of the following:
Impose or threaten to impose reprisals on employees, discriminate or threaten to discriminate against employees, or otherwise interfere with, restrain, or coerce employees because of their exercise of rights guaranteed to them by this chapter.
Refuse or fail to meet and negotiate in good faith with the district concerning any of the employees of which it is the exclusive representative.
Refuse to participate in good faith in mutually agreed upon impasse procedures.
This chapter shall not displace, or supplant, the requirements of Chapter 3 (commencing with Section 3610) of Division 4.5 of Title 1 of the Government Code, and the impasse resolution and injunctive relief procedures provided for pursuant to Sections 3612 to 3614, inclusive, of the Government Code shall remain exclusive.
The initial determination as to whether the charge of unfair practice is justified and, if so, the appropriate remedy necessary to effectuate the purposes of this chapter, is a matter within the exclusive jurisdiction of the Public Employment Relations Board, except that in an action to recover damages due to an unlawful strike, the Public Employment Relations Board shall not award strike-preparation expenses as damages, and shall not award damages for costs, expenses, or revenue losses incurred during, or as a consequence of, an unlawful strike.
Any charging party, respondent, or intervenor aggrieved by a final decision or order of the Public Employment Relations Board in an unfair practice case, except a decision of that board not to issue a complaint in such a case, may petition for a writ of extraordinary relief from that decision or order.
A petition for a writ of extraordinary relief shall be filed in the district court of appeal having jurisdiction over any county in which the district operates. The petition shall be filed within 30 days from the date of the issuance of the Public Employment Relations Board’s final decision or order, or order denying reconsideration, as applicable. Upon the filing of the petition, the court shall cause notice to be served on the Public Employment Relations Board and thereafter shall have jurisdiction of the proceeding. The Public Employment Relations Board shall file in the court the record of the proceeding, certified by that board, within 10 days after the clerk’s notice unless that time is extended by the court for good cause shown. The court shall have jurisdiction to grant any temporary relief or restraining order it deems just and proper, and in like manner to make and enter a decree enforcing, modifying, and enforcing as modified, or setting aside in whole or in part the decision or order of the Public Employment Relations Board. The findings of the Public Employment Relations Board with respect to questions of fact, including ultimate facts, if supported by substantial evidence on the record considered as a whole, shall be conclusive. Title 1 (commencing with Section 1067) of Part 3 of the Code of Civil Procedure relating to writs shall, except where specifically superseded by this section, apply to proceedings pursuant to this section.
If the time to petition for extraordinary relief from a Public Employment Relations Board decision or order has expired, the Public Employment Relations Board may seek enforcement of any final decision or order in a district court of appeal or superior court having jurisdiction over the county where the events giving rise to the decision or order occurred. The Public Employment Relations Board shall respond within 10 days to any inquiry from a party to the action as to why the Public Employment Relations Board has not sought court enforcement of the final decision or order. If the response does not indicate that there has been compliance with the Public Employment Relations Board’s final decision or order, the Public Employment Relations Board shall seek enforcement of the final decision or order upon the request of the party. The Public Employment Relations Board shall file in the court the record of the proceeding, certified by that board, and appropriate evidence disclosing the failure to comply with the decision or order. If, after hearing, the court determines that the order was issued pursuant to the procedures established by the Public Employment Relations Board and that the person or entity refuses to comply with the order, the court shall enforce the order by writ of mandamus or other proper process. The court may not review the merits of the order.
This chapter, as amended by the act adding this section, shall not be interpreted as if it were in conflict with any collective bargaining agreement and shall not be implemented to abrogate an agreement entered into between the district and an employee organization before January 1, 2023. This chapter shall be interpreted in a manner consistent with the Public Employment Relations Board’s interpretation of parallel provisions in other statutes it enforces.
Chapter 11.5 (commencing with Section 3555) of Division 4 of Title 1 of the Government Code applies to the district and its employees. Notwithstanding subparagraph (B) of paragraph (1) of subdivision (I) of Section 3558.8 of the Government Code, the district is a public employer for purposes of Chapter 11.5 (commencing with Section 3555) of Division 4 of Title 1 of the Government Code.
CHAPTER 5. Retirement System [98180. - 98205.]
ARTICLE 1. Establishment [98180. - 98185.]
The board may establish a retirement system for the officers and employees of the district and provide for the payment of annuities, pensions, retirement allowances, disability payments, and death benefits or any of them.
The district may maintain its own retirement fund or may provide for benefits to eligible officers and employees, or their beneficiaries, by means of group insurance, or other insurance, or by such means as in the opinion of the board will satisfactorily provide an adequate and sure method of meeting the payments contemplated by the retirement system.
Before establishing any retirement system the board shall secure a report from a qualified actuary, which shall show the cost of the benefits provided by the system, and the prospective assets and liabilities of the system.
The board may adopt all ordinances and resolutions and perform all acts necessary or convenient to the initiation, maintenance, and administrations of the retirement system.
Nothing in this chapter prevents the district from participation in and making all or part of its employees members of the State Employees’ Retirement System by contract entered into between the district and the board of administration of the system under the State Employees’ Retirement Law or from participating in the Federal Social Security Act pursuant to Part 4 (commencing with Section 22000), Division 5, Title 2 of the Government Code, and the district may perform all acts necessary or convenient for such participation. Nothing in this chapter shall prevent the district from participating in and making all of its employees members of the Santa Cruz County Employees’ Retirement System.
The board may classify and determine the officers and employees who shall be included as members in the retirement system and may change the classification from time to time. Membership of all officers and employees so classified and included in the retirement system is compulsory. The retirement system shall not apply to members of the board.
ARTICLE 2. Benefits and Contributions [98190. - 98196.]
The board may prescribe the terms and conditions upon which the officers and employees of the district or their beneficiaries shall be entitled to benefits and the amounts thereof provided, that said board shall have no such authority respecting the County Employees’ Retirement Act of 1937.
The retirement allowance may be predicated in part upon service rendered the district by a member prior to the establishment of the retirement system, which service is known as “prior service”.
The board shall provide that both the district and the members shall contribute to the retirement system. The rate of contribution by an officer or employee of the district becoming a member of the retirement system shall be so fixed as to provide, with accumulated interest and based on tables and assumptions adopted by the board, substantially one-half the value of any retirement allowance granted for service, exclusive of any credits allowed for prior service.
All members of the retirement system shall contribute in the manner and amount fixed by the board and such contributions may be collected by deducting the amounts thereof from the salary, wages or compensation due such members.
Liabilities accruing under the retirement system because of benefits other than such as are the equivalent of contributions by the members, with accumulated interests, shall be met by contributions by the district. Prior service or other liabilities of the district may be met by annual appropriation instead of by one appropriation for the total of the liabilities; but until the present value of regular contributions for current service, together with assets then available, equals the present value of all allowances and benefits granted or to be granted under the system, the appropriation for any one year when added to any unused balance of any previous appropriations for such purpose shall not be less than the amount disbursed during that year on account of prior service or other liabilities of the district.
If any member withdraws from the retirement system prior to retirement the total amount contributed by him with such interest as may be credited thereto, shall be returned to him, provided, however, that the board may prescribe the terms and conditions upon which a member, whose district service has been terminated except by death or retirement, may elect to leave his contributions and interest thereon in the retirement fund, and the terms and conditions upon which a retirement allowance may be made to him after such termination based upon his contributions prior to such termination.
All money received by any person as an annuity, pension, retirement, allowance, disability payment or death benefit, from the retirement system, and all contributions and interest thereon returned to any member of the retirement system, whether in the actual possession of such member or deposited, loaned, or invested by him, is exempt from execution or any other process except to the extent permitted by Section 704.110 of the Code of Civil Procedure and is unassignable.
ARTICLE 3. Retirement Board [98200. - 98203.]
The board may create a retirement board of not more than five members, at least two members of which shall be the elected representatives of the employees, to administer the retirement system, and shall define its powers and duties and the tenure of the members.
All members of the retirement board shall serve without pay.
The retirement board shall determine the eligibility of officers, employees, and their dependents to participation in the system and shall be the sole authority and judge under such ordinances as may be adopted by the board as to the conditions under which persons may be admitted to and continue to receive benefits of any sort under the retirement system, and may modify allowances for service and disability. The determination of the retirement board shall be final and conclusive and shall not be modified or set aside except for fraud or abuse of discretion.
If the district maintains its own retirement fund the retirement board shall have exclusive control of the administration, investment, and disbursement of such fund. Investment of the fund shall be subject to the terms, conditions, limitations, and restrictions imposed by the laws of this state upon savings banks in the making of investments by savings banks, and cash may be deposited in any licensed national bank or banks in this state or in any bank, banks, or corporations authorized or licensed to do a banking business and organized under the laws of this state.
ARTICLE 4. Investigation and Penalties [98204. - 98205.]
At least once in each four-year period after the establishment of the retirement system the board shall cause to be made an actuarial valuation of the assets and liabilities of the retirement fund and upon the basis of such investigation and valuation shall make such revision or change of the rate of contribution, the periods and conditions of service, and amounts of retirement allowances as may be necessary.
Except as herein provided, no member of the board or of the retirement board, nor any member of the retirement system or employee of the district, shall have any interest direct or indirect in the making of any investment or in the gains or profits accruing therefrom, and no such person, directly or indirectly, for himself or as an agent or partner of others shall borrow any of its funds, nor shall any such person in any manner use the same except to make such current and necessary payments as are authorized by the retirement board, nor shall such a person become an endorser or surety as to, or in any manner an obligor for investments of the retirement fund.
CHAPTER 6. Powers and Functions of District [98210. - 98296.]
ARTICLE 1. Corporate Power [98210. - 98214.]
The district has perpetual succession and may adopt a seal and alter it at its pleasure.
The district may sue and be sued, except as otherwise provided by law, in all actions and proceedings, in all courts and tribunals of competent jurisdiction.
The district may exercise the right of eminent domain to take any property necessary or convenient to the exercise of the powers granted in this part. The district, in exercising such power, in addition to the damage for the taking, injury, or destruction of property, shall also pay the cost of removal, reconstruction, or relocation of any structure, railways, mains, pipes, conduits, cables, or poles of any public utility or public district which is required to be moved to a new location.
No action in eminent domain to acquire property or interests therein within any incorporated city or any county shall be commenced unless the legislative body of the affected city or county has consented to such acquisition by resolution.
No such taking or acquisition by the district which would involve the abandonment, removal, relocation, or use of property of a railroad corporation, as defined in Section 230 of this code, shall be permitted, unless the Public Utilities Commission, after hearing, shall find and determine that the public interest and necessity require the abandonment, removal, relocation, or use of such property and that such taking or acquisition will not unreasonably impair the ability of the railroad corporation involved to provide safe, adequate, economical, and efficient service.
ARTICLE 2. Contracts [98220. - 98221.]
The district may make contracts and enter into stipulations of any nature whatsoever, either in connection with eminent domain proceedings or otherwise, including, without limiting the generality of the foregoing, contracts and stipulations to indemnify and hold harmless, to employ labor, and to do all acts necessary and convenient for the full exercise of the powers granted in this part.
No officer or employee of the district shall in any manner be interested directly or indirectly, in any contract awarded or to be awarded by the board, or in the profits to be derived therefrom contrary to the provisions of Article 4 (commencing with Section 1090), Chapter 1, Division 4, Title 1 of the Government Code.
ARTICLE 4. Property [98233. - 98234.]
The district may take by grant, purchase, gift, devise or lease, or condemn in proceedings under eminent domain, or otherwise acquire, and hold and enjoy, real and personal property of every kind within or without the district necessary to the full or convenient exercise of its powers. The board may lease, sell, mortgage, or otherwise dispose of any real or personal property within or without the district when in its judgment it is for the best interests of the district so to do.
Whenever the board by resolution determines that any record, map, book, or paper in the possession of the district or any officer or employee thereof is of no further value to the district, the board may authorize its sale, destruction, or other disposition.
ARTICLE 5. Transit Facilities and Service [98240. - 98251.]
The district may acquire, construct, own, operate, control or use rights-of-way, rail lines, buslines, stations, platforms, switches, yards, terminals, and any and all other facilities necessary or convenient for transit service within or partly without the district, underground, upon, or above the ground and under, upon, or over public streets or other public ways or waterways, together with all physical structures necessary or convenient for the access of persons and vehicles thereto, and may acquire any interest in or rights to the joint use of any or all of the foregoing; provided, that installations in any street, road or other property devoted to a public use shall be subject to consent of the governing body in charge of such public use.
The district may without limitation by any other provisions of this part requiring approval of indebtedness, accept contributions of money, rights-of-way, labor, materials, and any other property for the acquisition, construction, maintenance and operation of transit facilities, and may without limitations by any other provisions of this part enter into any contracts and cooperation with and accept cooperation from the state, or any department, instrumentality, or agency thereof, or any public agency in the acquisition, construction, maintenance, and operation of, and in financing the acquisition, construction, maintenance, and operation of, any such transit facilities.
The district shall not interfere with or exercise any control over any transit facilities now or hereafter owned, and operated wholly or partly within the district by any city or public agency, unless by consent of such city or public agency and upon such terms as are mutually agreed upon between the board and such city or public agency.
The district may lease or contract for the use of its transit facilities or any portion thereof, to any operator, and may provide for subleases by such operator upon such terms and conditions as it deems in the public interest. The word “operator” as used in this section means any city or public agency or any person, firm or private corporation.
The district may construct and operate or acquire and operate works and facilities in, under, upon, over, across, or along any street or public highway or any stream, bay or watercourse, or over any of the lands which are the property of the state, to the same extent that such rights and privileges appertaining thereto are granted to municipalities within the state, and to install adequate bus stops, including the painting of curbs, subject to the consent of the governing body in charge of such streets, highways, stream, watercourse, or lands.
The district may enter into agreements for the joint use of any property and rights by the district and any city, public agency or public utility operating transit facilities; may enter into agreements with any city, public agency or public utility operating any transit facilities, either wholly or partially within, or without, the district, for the joint use of any property of the district or of such city, public agency or public utility, or the establishment of through routes, joint fares, transfer of passengers or pooling arrangements.
The rates and charges for service furnished pursuant to this part shall be fixed by the board and shall be reasonable.
The board of supervisors or the city council of a municipality having territory located within the district may file a request for a hearing before the district board as to the reasonableness of any rates or charges fixed by the district and as to any proposal for fixing the location of facilities by the district. The request shall be in writing and shall state the subject matter on which a hearing is desired.
Upon the filing of a request for hearing as provided in Chapter 8 (commencing with Section 98390) of this part, the district board shall fix the time and place for hearing. The time fixed shall not be less than 15 days nor more than 60 days from the date such request is filed. Notice of such hearing shall be given to the county or city requesting such hearing and shall be published by the board.
At the time fixed for any hearing before the board any board of supervisors or city council eligible to file a request for hearing, not a party to the original request for hearing, may intervene and shall be entitled to be heard and to introduce evidence.
Within 30 days after submission of the case, the board shall render its decision and its decision shall be final.
The district shall be subject to the provisions of Division 14.8 (commencing with Section 34500) of the Vehicle Code with respect to the operation of buses and to the rules and regulations prescribed by the Department of the California Highway Patrol pursuant to that chapter regulating the safe operation of buses.
ARTICLE 6. Indebtedness [98260. - 98263.]
The district may borrow money for the purpose of defraying the expenses of the district lawfully incurred after the commencement of the fiscal year, but prior to the time moneys from the tax levy for the fiscal year are received by the district, in an amount, including interest to be paid thereon, which shall not exceed its estimated tax revenues for the fiscal year, and may evidence such borrowing by notes bearing interest at a rate not to exceed 6 percent per annum. The notes shall be payable from the tax levy from the then current fiscal year, which levy shall contain a sum sufficient to provide for the payment of the notes and the interest thereon. The form of the notes and the proceedings relating to their issuance and sale, shall be governed by the applicable provisions contained in Article 7 (commencing with Section 53820) of Chapter 4 of Part 1 of Division 2 of Title 5 of the Government Code.
The district shall not incur an indebtedness under Chapter 7 (commencing with Section 98310) of this part which in the aggregate exceeds one (1) percent of the assessed value of all the real and personal property within the district.
The district may accept, without limitation by any other provisions of this part requiring approval of indebtedness, contributions or loans from the United States, this state, or any department, instrumentality, or agency of either thereof, for the purpose of financing the acquisition, construction, maintenance, and operation of transit facilities, and may enter into contracts and cooperate with and accept cooperation from, the United States, this state, or any department, instrumentality, or agency of either thereof, in the acquisition, construction, maintenance, and operation, and in financing the acquisition, construction, maintenance, and operation, of any such transit facilities in accordance with any legislation which Congress or the Legislature of the State of California may have heretofore adopted or may hereafter adopt, under which aid, assistance, and cooperation may be furnished by the United States or this state in the acquisition, construction, maintenance and operation of any such transit facilities. The district may do any and all things necessary in order to avail itself of such aid, assistance, and cooperation under any federal or state legislation now or hereafter enacted. Any evidence of indebtedness issued under this section shall constitute a negotiable instrument.
ARTICLE 7. Investments [98270. - 98270.]
The district may invest any surplus money in its treasury. The county treasurer shall act as treasurer of the district and he shall handle such investments as the board determines to make in accordance with the same policies and procedures that he follows in the investment of surplus county funds.
The board shall pay a reasonable fee to the county for the investment services of the county treasurer.
ARTICLE 8. Property Taxation [98280. - 98289.5.]
The district may levy, and collect or cause to be collected, taxes for any lawful purpose subject to a maximum limit of five cents ($0.05) per one hundred dollars ($100) of assessed value of all real estate and personal property within the district; provided, however, that the district shall have the further power to levy, collect or cause to be collected, said property taxes to a maximum limit of ten cents ($0.10) if the matter is first submitted to the voters in the district and a majority of those voting vote in favor of raising the maximum tax limit.
If, in the opinion of the board, the transit operation revenues will not be sufficient for any and all lawful purposes the board shall levy a tax for such purpose or purposes and fix the amount of money necessary to be raised therefor by taxation as part of the general tax levy as set forth in Section 98280.
The board shall, as part of the general tax levy as set forth in Section 98280, levy and collect annually until the district’s bonds are paid, or until there is a sum in the treasury of the district set apart for that purpose to meet all sums coming due for principal and interest on the bonds as they become due a tax sufficient to pay the annual interest on the bonds and such part of the principal thereof as becomes due before the proceeds of a tax levied at the next general tax levy will be available. If the maturity of the indebtedness created by the issue of bonds begins more than one year after the date of the issuance thereof, the tax shall be levied and collected annually at the time and in the manner aforesaid, sufficient to pay the interest on the indebtedness as it falls due and to constitute a sinking fund for the payment of the principal on or before maturity.
The board may provide for the assessment, levy, and collection of taxes by the district.
The board shall avail itself of the assessments made by the assessor of the county and of the assessments made by the State Board of Equalization for the county and shall take such assessments as the basis for the district taxation and have its taxes collected by the tax collector of the county, as part of the annual tax bill.
In such case the county auditor shall, on or before the third Monday in August of each year, transmit to the board a statement in writing showing the total value of all property within the district, ascertained from the assessments referred to in Section 98283 as equalized.
The board shall on or before the first day of September fix the rate of taxes, designating the number of cents upon each one hundred dollars ($100) using as a basis the value of property transmitted to the board by the county auditor, which rate of taxation shall be sufficient to raise the amount previously fixed by the board. These acts by the board shall constitute a valid assessment of the property and a valid levy of the taxes so fixed but the rate of taxation shall not exceed the limit imposed by this article.
The board shall immediately after fixing the rate of taxes as above provided transmit to the county auditor of the county a statement of the rate of taxes fixed by the board.
The district’s taxes so levied shall be collected at the same time and in the same manner as county taxes. When collected the net amount, ascertained as provided in this article, shall be paid to the treasurer of the district, under the general requirements and penalties provided by law for the settlement of other taxes.
Whenever any real property has been sold for taxes and has been redeemed, the money paid for redemption shall be apportioned and paid to the district by the county treasurer in the proportion which the tax due to the district bears to the total tax for which the property was sold.
The compensation to be charged by and paid to any county for the performance of services under this article shall be fixed by agreement between the board of supervisors of the county and the board. The compensation shall in no event exceed one-half of 1 percent of all money collected for the district. The compensation collected by the county shall be placed to the credit of the county general fund.
All taxes levied under this article are a lien on the property on which they are levied and shall become a lien at the same time as county taxes. The enforcement of the collection of such taxes shall be in the same manner and by the same means provided by law for the enforcement of liens for county taxes, all the provisions of law relating to the enforcement of the latter being made a part of this article so far as applicable.
That portion of any property tax installment payable to the district is canceled if the installment may be paid without a delinquent penalty pursuant to Chapter 2.1 (commencing with Section 2700) of Part 5 of Division 1 of the Revenue and Taxation Code on or after the operative date of the transactions and use tax ordinance.
ARTICLE 8.5. Retail Transactions and Use Tax [98290. - 98296.]
A retail transactions and use tax ordinance may be adopted by the board in accordance with the provisions of Part 1.6 (commencing with Section 7251) of Division 2 of the Revenue and Taxation Code, provided that two-thirds of the electors voting on the measure vote to authorize its enactment at a special election called for that purpose by the board.
Notwithstanding Section 7251.1 of the Revenue and Taxation Code, a transactions and use tax rate imposed pursuant to subdivision (a) on or before January 1, 2020, shall not be considered for purposes of the combined rate limit established by that section.
In addition to any other taxes imposed pursuant to this section, the board may impose a retail transactions and use tax pursuant to subdivision (a) after January 1, 2024, if both of the following conditions are met:
The board adopts the ordinance approving the tax before January 1, 2035.
The total tax rate under this subdivision is set at a rate of no more than 0.5 percent.
Notwithstanding Section 7251.1 of the Revenue and Taxation Code, a transactions and use tax rate imposed pursuant to this subdivision shall not be considered for purposes of the combined rate limit established by that section.
Notwithstanding any other law, the special taxes authorized in this article may also be imposed by qualified voter initiative, including a qualified voter initiative for which a petition has been circulated on or after January 1, 2026.
If the board or a qualified voter initiative proposes a measure pursuant to this article, the special election shall be consolidated with a statewide election by the board of supervisors of the County of Santa Cruz and the measure shall be submitted to the voters of the County of Santa Cruz.
For the purpose of placement of a measure on the ballot, the district is a “district,” as defined in Section 317 of the Elections Code. Except as otherwise provided in this section, a measure proposed by the board or by a qualified voter initiative that requires voter approval shall be submitted to the voters of the County of Santa Cruz, as determined by the district, in accordance with the provisions of the Elections Code applicable to districts, including the provisions of Chapter 4 (commencing with Section 9300) of Division 9 of the Elections Code.
Notwithstanding Section 10520 of the Elections Code, for any election at which the board or a qualified voter initiative proposes a measure pursuant to this article, the district shall reimburse the County of Santa Cruz for the incremental costs incurred by the county elections official related to submitting the measure to the voters with any eligible funds transferred to the district.
For purposes of this subdivision, “incremental costs” includes all of the following:
The cost to prepare, review, and revise the impartial analysis of the measure.
The cost to prepare a translation of ballot materials into a language other than English by the county.
The additional costs that exceed the costs incurred for other election races or ballot measures, if any, appearing on the same ballot in the County of Santa Cruz, including both of the following:
The printing and mailing of ballot materials.
The canvass of the vote regarding the measure pursuant to Division 15 (commencing with Section 15000) of the Elections Code.
Notwithstanding Section 9313 of the Elections Code, the legal counsel for the board shall prepare an impartial analysis of the measure. The impartial analysis prepared by the legal counsel for the board shall be subject to review and revision by the county counsel.
The county elections official for the County of Santa Cruz shall serve as the elections official of the district for purposes of administering the ballot measure process and any election for the purposes set forth in this chapter.
This section applies to any measure proposed by the board on or after January 1, 2026, or by a qualified voter initiative for which a petition has been circulated on or after January 1, 2026.
Any transactions and use tax ordinance adopted shall be operative on the first day of the first calendar quarter commencing not less than 180 days after adoption of the ordinance.
The district may contract with the State Board of Equalization for its service in the preparations necessary to administer a transactions and use tax ordinance. The costs to be covered by the contract are to be for services of the types described in Section 7272 of the Revenue and Taxation Code for preparatory work up to the date of the adoption of the ordinance. Any dispute as to the amount of the costs shall be resolved in the same manner as provided in that section.
Prior to the operative date of the transactions and use tax ordinance, the district shall contract with the State Board of Equalization to perform all functions incident to the administration and operation of the ordinance.
If the district shall not have contracted with the State Board of Equalization prior to the operative date of its transactions and use tax ordinance, it shall nevertheless so contract, and, in such case, the operative date shall be the first day of the first calendar quarter following the execution of the contract.
Repeal of the transactions and use tax ordinance shall not be operative earlier than the first day of the first calendar quarter following the adoption of the ordinance of repeal.
Whenever a bond election is held to authorize a bonded indebtedness pursuant to Article 1 (commencing with Section 98310) of Chapter 7, the ordinance calling the election may include a statement that the transactions and use taxes, or a stated portion thereof, shall be levied, or continued to be levied, and used to the extent required to pay the principal of, and interest on, the bonds as they become due, to provide any sinking fund payments required therefor, and to create or maintain any reserve fund required therefor.
A vote in favor of the issuance of the bonds shall authorize the use of such taxes for such purposes. The transactions and use tax ordinance shall not be repealed until all bonds payable from the revenues derived from such taxes have been fully paid or provision has been made for their payment in full.
CHAPTER 6.5. Existing Systems [98300. - 98305.]
As used in this chapter:
“Establish” includes establish, construct, complete, acquire, extend or reroute. It does not, however, include the maintenance and operation of any existing system by the district.
“Existing system” means any transit service or system of a publicly or privately owned public utility situated entirely within the district or at least 75 percent of whose revenue vehicle miles for the preceding calendar year were operated within the district.
Notwithstanding any other provision of this part, before the district may establish any transit service or system which may at any time divert, lessen, or compete for the patronage or revenues of any existing system, the district shall give a written notice to the public utility which is operating the existing system. The written notice shall describe the transit service or system which the district proposes to establish and shall state the time within which the district proposes to establish such service or system.
The district shall not establish the proposed service or system, or maintain and operate the service or system until it has offered to purchase the buses and such other facilities of the existing system as it will have need of and use for, and such offer has either been rejected or the purchase completed.
The purchase price to be paid for the existing system, or that part thereof which the district desires to purchase, shall be the reasonable market value of the buses and other facilities of the existing system on the date that the district commences negotiations for such purchase.
The district and the public utility operating the existing system may agree upon the purchase price or they may agree that the purchase price is to be established by arbitration and upon the method of naming arbitrators and the method of conducting such arbitration. If they do not, the purchase price may be fixed and judgment entered thereon in a suit brought either by the public utility or the district in the superior court in and for the county in which is located that portion of the existing system to be acquired by the district which has the highest value.
Section 851 of the Public Utilities Code does not apply to any contract for sale or sale of an existing system, or any portion thereof, pursuant to this chapter, and the Public Utilities Commission shall have no jurisdiction with respect thereto.
CHAPTER 7. Bonds [98310. - 98381.]
ARTICLE 1. Issuance [98310. - 98318.]
The district may from time to time incur a bonded indebtedness as provided in this chapter to pay the cost of acquiring, constructing or completing the whole or any portion of any transit facilities, or for acquiring any works, lands, structures, rights, equipment, or other property necessary or convenient to carry out the objects, purposes, or powers of the district. The total amount of bonds issued and outstanding shall not exceed 1 percent of the assessed value of the taxable property of the district as shown by the last equalized assessment roll of the County of Santa Cruz.
Whenever the board by resolution passed by vote of two-thirds of all its members determines that the public interest or necessity demands the acquisition, construction, or completion by the district of any transit facilities or any works, lands, structures, rights, equipment, or other property necessary or convenient to carry out the objects, purposes, or powers of the district, the cost of which will be too great to be paid out of the ordinary annual income and revenue of the district, it may at any subsequent meetings of the board provide by ordinance for the submission of the proposition of incurring a bonded indebtedness for the purpose set forth in the resolution to the voters of the district at a special bond election held for that purpose.
The ordinance calling a special bond election shall fix the date on which the election will be held, and the manner of holding the election and of voting for or against incurring the indebtedness. It shall also recite the objects and purposes for which the indebtedness is proposed to be incurred, the estimated cost of the transit facilities, works, lands, structures, rights, equipment, or other property proposed to be acquired, constructed, or completed, the amount of the principal of the indebtedness to be incurred therefor, and the maximum rate of interest to be paid on the indebtedness, which shall not exceed 6 percent per annum, payable semiannually or annually the first year and thereafter semiannually.
Propositions for incurring indebtedness for more than one object or purpose may be submitted at the same election.
Any special bond election may be held separately, or may be consolidated with any other election, the provisions of this chapter setting forth the procedure for the calling and holding of the special bond election shall be complied with, except that the ordinance calling the election need not set forth election precincts, polling places, and officers of election, but may provide that the precincts, polling places, and officers of election shall be the same as those set forth in the ordinance, notice, or other proceedings calling the election with which the special bond election is consolidated, and shall refer to the ordinance, notice, or other proceedings by number and title, or by other definite description.
The ordinance shall be published, and no other notice of election need be given.
The board shall comply with Article 3, (commencing with Section 9160) of Chapter 2 of Division 9 of the Elections Code, the provisions of which are applicable to any bond election held pursuant to this article. Wherever the words “county clerk” or “county elections official” appear in the Elections Code the words “secretary of the board” shall be substituted, for the purposes of this article, and wherever the words “board of supervisors” appear in the Elections Code, the words “board of directors” shall be substituted, and wherever the words “district attorney or county counsel” appear in the Elections Code, the words “attorney for the district” shall be substituted.
The votes of two-thirds (23) of all voters voting on the proposition at the election are required to authorize the issuance of bonds under this chapter.
If the proposition submitted at a special bond election fails to receive the requisite number of votes, the board shall not within six months after the election hold another special election for the submission of a proposition of incurring a bonded indebtedness substantially the same as the proposition voted upon at the prior election unless a petition signed by voters within the district equal in number to at least 15 percent of the total vote cast at the last general statewide election is filed with the board, requesting that the proposition, or a proposition substantially the same, be submitted at an election to be called for that purpose.
ARTICLE 2. Form and Content [98330. - 98335.]
Bonds authorized by this chapter shall mature serially in amounts to be fixed by the board; except that payment shall begin not later than 10 years from the date thereof and shall be completed in not more than 50 years from that date.
The board may divide any issue of bonds authorized pursuant to this chapter into two or more series, and may fix different dates of issuance and different maturity dates for the bonds of each series. The bonds of each series shall mature serially in amounts to be fixed by the board, and the board shall fix a date not more than 10 years from the date of issuance of each series for the earliest maturity of such series and shall fix a date not more than 50 years from the date of issuance of each series for the final maturity of such series.
Pending the actual issuance or delivery of bonds, a district may issue temporary or interim bonds, certificates, or receipts, of any denomination whatsoever, with or without coupon, and in such form as may be prescribed by the board, to be exchanged for definite bonds when ready for delivery.
The bonds shall be issued in such denominations as the board determines, except that no bonds shall be issued of a denomination less than one thousand dollars ($1,000) and shall be payable on the day and at the place or places fixed in the bond, and with interest at the rate specified therein, payable semiannually.
The board may at any time prior to the issuance and sale of any bonds provide for the call and redemption of any or all of the bonds on any interest payment date prior to their fixed maturity at not exceeding the par value and accrued interest plus a premium of not exceeding 5 percent upon the principal amount of the bonds, in which event the call price of such redemption shall be set forth on the face of the bond. Notice of such redemption shall be published. If there is no newspaper of general circulation printed and published within the district, then the publication shall be made in a newspaper of general circulation, printed and published within the district, then the publication shall be made in a newspaper of general circulation, printed and published within the county, or any part thereof is situated. The first publication shall be at least 30 days prior to the date fixed for the redemption. After the date fixed for such redemption interest on the bonds thereafter shall cease.
The bonds shall be signed by the chairman of the board or by such officer of the district as the board shall by resolution authorize and designate for that purpose. They shall also be signed by the treasurer, and be countersigned by the auditor. The coupons of the bonds shall be numbered consecutively and be signed by the treasurer. All signatures and countersignatures on the bonds, except one of the signatures or countersignatures on the bonds, may be printed, lithographed or engraved. If any officer whose signature or countersignature appears on the bonds or coupons ceases to be such officer before the delivery of the bonds to the purchaser, the signature or countersignature is nevertheless valid and sufficient for all purposes as if he had remained in office until the delivery of the bonds.
ARTICLE 3. Issue and Sale [98340. - 98342.]
The bonds may be issued and sold for not less than their par value, but otherwise as the board determines. Before selling any bonds, or any part thereof, the board shall give notice inviting sealed bids in such manner as the board may prescribe. If satisfactory bids are received, the bonds offered for sale shall be awarded to the highest responsible bidder. If no bids are received, or if the board determines that the bids received are not satisfactory as to the price or responsibility of the bidders, the board may reject all bids received, if any, and either again give notice inviting bids or sell the bonds at private sale.
All premiums and accrued interest received on the sale of bonds shall be placed in the fund to be used for the payment of principal of and interest on the bonds. The remainder of the proceeds of the bonds shall be placed in the district treasury to the credit of the proper fund, and shall be used exclusively for the objects or purposes for which the bonds were voted; provided that when such objects and purposes have been accomplished any moneys remaining shall be transferred to the fund to be used for the payment of principal and interest on the bonds shall have been paid, any balance of money then remaining shall be transferred to the general fund of the district.
In lieu of the immediate levy of a tax to pay the interest or any part thereof on any bonded indebtedness incurred in accordance with this part the board may, in the estimate of the amount of money necessary to be raised by the bonds, include a sum sufficient to pay interest on all of the bonds or part thereof during the period of acquisition, construction, or completion, but for no period in excess of five years.
ARTICLE 4. Refunding [98350. - 98356.]
Whenever the board by resolution passed by a vote of two-thirds of all its members determines that the refunding of the whole or any portion of the bonded indebtedness will be of advantage to the district, the board may refund the bonded indebtedness or any portion thereof and issue refunding bonds of the district therefor.
The issuance of refunding bonds shall not be construed as the incurring or increase of an indebtedness within the meaning of this act, and the approval of the voters is not required for the issuance of refunding bonds. The board may provide for the call and redemption of any or all of the bonds on any interest payment date prior to their fixed maturity in the ordinance authorizing the issuance of the refunding bonds.
Except as otherwise provided, the provisions of this chapter shall substantially govern as to all matters pertaining to the issuance of refunding bonds, including and without limiting the generality of the foregoing, the form, execution, issuance, maturity, redemption, refunding, validation, the payment of interest from bond funds, and the status of the bonds as investments.
Refunding bonds shall bear interest at a rate not exceeding the interest rate on the refunded bonds, but payment of the refunding bonds shall begin not later than one year from the date thereof and be completed in not more than 40 years from that date.
The proceeds of the sale of refunding bonds shall be applied only to the purchase, or retirement at not more than par and accrued interest, or the call price, of the bonded indebtedness for which the refunding bonds were issued.
In lieu of selling refunding bonds and using the proceeds to purchase or retire the bonds to be refunded, the board may exchange refunding bonds at not less than par and accrued interest for the bonds so refunded.
Wherever outstanding bonds are refunded they shall be surrendered to the treasurer of the district, who shall cancel them by endorsing on their face the manner in which the refunding was effected, whether by exchange or purchase, and the amount for which so purchased, (if any) and by perforating through each bond and each coupon attached thereto the word “canceled” together with the date of cancellation.
ARTICLE 5. Status as Investments [98360. - 98361.]
All bonds including refunding bonds issued by a district are legal investments for all trust funds and for the funds of all insurance companies, banks, both commercial and savings, and trust companies, and for the State School Fund and for all sinking funds under the control of the State Treasurer. Whenever any money or funds may be invested in or loaned upon the security of the bonds of the district; and whenever bonds of cities, cities and counties, counties, or school districts by law may be used as security for the faithful performance or execution of any court or private trust or of any other act, bonds of the district may be used.
All bonds of the district, to the same extent as bonds of any other municipality, are legal for use by any other municipality, are legal for use by any state or national bank or banks in the state as security for the deposit of funds of the state or of any county, city and county, city, municipality or other public or municipal corporation within the state.
ARTICLE 6. Validation [98370. - 98370.]
An action to determine validity of bonds, including refunding bonds, may be brought pursuant to Chapter 9 (commencing with Section 860) of Title 10 of Part 2 of the Code of Civil Procedure.
ARTICLE 7. Revenue Bonds [98380. - 98381.]
As an alternative procedure for the raising of funds, the district may issue bonds, payable from revenues of any facility or enterprise to be acquired or constructed by the district, in the manner provided by the Revenue Bond Law of 1941 (Chapter 6 (commencing with Section 54300) of Part 1 of Division 2 of Title 5 of the Government Code), all of the provisions of which are applicable to the district.
The district is a local agency within the meaning of the Revenue Bond Law of 1941 (Chapter 6 (commencing with Section 54300) of Part 1 of Division 2 of Title 5 of the Government Code). The term “enterprise” as used in the Revenue Bond Law of 1941 shall, for all purposes of this part, include transit facilities and any and all parts thereof and all additions, extensions and improvements thereto and all other facilities authorized to be acquired, constructed, or completed by a district or, in the alternative, may issue revenue bonds under the Revenue Bond Law of 1941, for the acquisition, construction and completion of any one of such facilities. Nothing in this article shall prevent the district from availing itself of, or making use of, any procedure provided in this part for the issuance of bonds of any type or character for any of the facilities or works authorized hereunder, and all proceedings may be carried on simultaneously or in the alternative, as the directors may determine.
CHAPTER 8. Annexation [98390. - 98396.]
Territory may be annexed to the district in the manner provided in this chapter. Territory to be annexed need not be contiguous to the present district.
Whenever the board finds and determines that additional territory will be benefited by annexation to the district, it shall pass a resolution to that effect. Approval of the local agency formation commission shall be required for such annexation, and shall be obtained before the board holds its hearing.
The resolution shall be passed by a vote of two-thirds of the members of the board and shall:
Describe the boundaries of the territory proposed to be annexed.
Designate the proposed annexation by an appropriate name.
Declare that the area to be annexed to the district will be benefited by such annexation.
Name the time and place for the hearing of objections by any person interested in the proposed annexation.
The resolution, together with the names of the members of the board, voting for and against it shall be published pursuant to Section 6066 of the Government Code in a newspaper published in the territory proposed to be annexed, or if there is no such paper, then in some newspaper of general circulation, circulated in such territory.
On the day fixed for hearing or any day to which the hearing is adjourned, the board shall hear and consider any objections presented to the annexation of the territory. After the hearing of objections, if it shall be determined by a vote of two-thirds (23) of all the members of the board that the territory proposed to be annexed will be benefited by such annexation, the board shall proceed to fix and determine the boundaries of the territory to be annexed to the district.
After making all necessary and proper changes in the boundaries, by a resolution passed by a vote of two-thirds of the members, the board shall order the annexation of the territory so described. The resolution together with the names of the members of the board voting for and against the same shall be spread upon the minutes of the board.
Whenever any territory is annexed to the district it shall thereupon become a part of the district subject to all the liabilities and entitled to all the benefits of the district.
CHAPTER 9. Exclusion [98397. - 98399.]
Territory within the district may be excluded from the district in the manner provided in this chapter. Proceedings for the exclusion of such territory may be initiated by the filing of a petition with the board of supervisors signed by not less than 10 percent of the registered voters in the territory proposed to be excluded. The petition shall:
Describe the boundaries of the territory to be excluded.
Declare that the area to be excluded from the district is not benefited by remaining in the district.
Request exclusion of the territory.
After the petition is filed with the board of supervisors, the board of supervisors shall determine whether the petition is signed by a sufficient number of voters and if the petition is sufficient, the board of supervisors shall refer the question to the local agency formation commission, which shall hold a hearing on the question.
The notice shall contain the following:
That a petition for exclusion has been filed with the board of supervisors.
That a public hearing will be held upon the said petition and the proposed exclusion by the local agency formation commission, stating the time and place of such public hearing.
That any interested person may appear and be heard at said public hearing.
Describe the boundaries of the territory proposed to be excluded.
On the day fixed for the hearing, or any day to which the hearing may be adjourned, the local agency formation commission shall hear persons interested, and shall hear and consider any objections to the proposed exclusion. After the hearing, if it should be determined by a majority of all of the members on the local agency formation commission that the territory proposed to be excluded will not be benefited by remaining in the district, the commission shall recommend to the board of supervisors that the said territory be excluded. The exclusion shall be effective immediately upon resolution by the board of supervisors, provided, however, that the excluded territory shall not be relieved by such exclusion from liability for taxation for the payment of any bonded indebtedness existing at the time of the exclusion. Notice of the exclusion shall be given pursuant to Government Code Sections 54900 et seq.
CHAPTER 10. Dissolution [98400. - 98407.]
The board may call an election any time for the purpose of submitting to the voters of the district the question of whether the district will be dissolved. Upon the filing with the clerk of the district of a petition signed by voters within the district equal in number to at least twenty-five percent (25%) of the total vote cast within the district at the last general statewide election asking that the question of dissolution of the district be submitted to the voters of the district, the board shall call such an election.
The election for the purpose of submitting to the voters of the district the question of whether or not the district shall be dissolved shall be held on the next established election date not less than 74 days next succeeding the date on which the petition is filed.
Notice of any election for dissolution, whether called because of the filing of a petition or ordered by the board without petition, shall be published. The election shall be held on the next established election date not less than 74 days from the date of the first publication of the notice.
The ballots for the election shall contain substantially the instructions required to be printed on ballots for use at general state and county elections and in addition the following:
The board shall canvass the vote. If a majority of the votes favor dissolution, the board shall by resolution dissolve the district.
The board shall file a certified copy of the resolution with the Secretary of State and for record in the office of the county recorder.
Upon dissolution the right, title and interest to property owned or controlled by the district shall be divided among the cities within the district and the county according to the ratio which the assessed valuation of taxable property of each city within the district and the unincorporated area within the district bears to the total assessed valuation of taxable property within the district.
The board of supervisors is, ex officio, the governing body of the dissolved district. It may levy taxes and assessments and perform other acts necessary to wind up the district affairs and to raise money for the payment of outstanding indebtedness.
PART 11. PROVISIONS APPLICABLE TO ALL PUBLIC TRANSIT [99150. - 99582.]
CHAPTER 3. Miscellaneous [99150. - 99178.]
In locating its bus stops, park and ride service facilities, and special service terminal points and stations, a transit district shall consult with, and consider the recommendations of, the city if such transit facilities are to be located therein, or the county if such transit facilities are to be located in the unincorporated area thereof, on the proposed locations.
The city or county, as the case may be, in making its recommendations to the transit district on the proposed location of any such transit facilities, shall consider whether the proposed location is consistent with the circulation element of its general plan.
Any transit district whose area is served by the Southern Pacific Transportation Company line from the City of San Jose to the City and County of San Francisco may make a bulk purchase of passenger tickets for that line from the company, or from the Greyhound Bus Lines for transportation services within the area, or from both, for resale at less than the cost to the transit district to residents of the transit district.
The governing body of the transit district shall determine the resale price of tickets purchased by it.
Any public transit guideway planned, acquired, or constructed, on or after January 1, 1979, is subject to regulations of the Public Utilities Commission relating to safety appliances and procedures.
The commission shall inspect all work done on those guideways and may make further additions or changes necessary for the purpose of safety to employees and the general public.
The commission shall develop an oversight program employing safety planning criteria, guidelines, safety standards, and safety procedures to be met by operators in the design, construction, and operation of those guideways. Existing industry standards shall be used where applicable.
The commission shall enforce the provisions of this section.
Any transit district or operator may adopt uniform standards to rate bidders, on the basis of questionnaires and required statements, with respect to contracts for railroad rolling stock upon which each bidder is qualified to bid. Notwithstanding any other provision of law, the district or operator may limit bidding and award of contracts for railroad rolling stock to the bidders the district or operator has determined are qualified to bid. However, the district or operator shall qualify at least two persons or entities for bidding on the contracts.
For purposes of this section, the following definitions apply:
“Continued use” means the continued operation of the diesel engine from the diesel-powered on-track equipment as an internal combustion engine to provide power for on-track equipment or any other purpose.
“Decommission” means to permanently cease the service of on-track equipment when the public entity owning that on-track equipment replaces it with lower emission on-track equipment.
“Diesel-powered on-track equipment” means any locomotive or any other car, rolling stock, equipment, or other device that is operated on stationary rails and has a diesel engine.
Except as provided in subdivision (c), a public entity that owns diesel-powered on-track equipment shall not sell, donate, or otherwise transfer ownership of that diesel-powered on-track equipment for continued use after the public entity decommissions the diesel-powered on-track equipment.
A public entity may engage in a transaction otherwise prohibited by subdivision (b) if both of the following criteria are satisfied:
The diesel-powered on-track equipment meets any of the following conditions:
The equipment is deemed to be in Tier 2, Tier 3, or Tier 4, as designated by the United States Environmental Protection Agency.
The equipment produces emissions equivalent to any equipment within any of the tiers described in subparagraph (A).
The diesel engine is removed from the equipment.
The public entity authorizes the transaction in a public hearing.
Any transit district or operator may require from prospective bidders for any contract answers to questions contained in a standard questionnaire and financial statement, including a complete statement of the prospective bidder’s financial ability and experience in performing public contracts. When completed, the questionnaire and financial statement shall be verified under oath by the bidder in the manner in which pleadings are verified in civil actions.
The questionnaires and financial statements are not public records and shall not be open to public inspection.
Each transit operator, whether publicly or privately funded all or in part, nonprofit or for profit, which offers reduced fares to senior citizens shall honor the federal Medicare identification card as sufficient identification to receive reduced fares. A transit operator which offers reduced fares to those senior citizens who are less than 65 years old shall also honor the senior citizen identification card issued pursuant to subdivision (b) of Section 13000 of the Vehicle Code.
Each transit operator, whether publicly or privately funded, in whole or in part, nonprofit or for profit, which offers reduced fares pursuant to subdivision (a) shall also offer reduced fares to disabled persons, as defined by Section 99206.5, disabled persons, as defined by Section 295.5 of the Vehicle Code, and disabled veterans, as defined by Section 295.7 of the Vehicle Code, at the same rate established for senior citizens. A transit operator shall honor the disabled person or disabled veteran placard identification card issued pursuant to Section 22511.55 of the Vehicle Code.
Every transit operator that offers reduced fares to disabled persons shall honor any current identification card that is valid for the type of transportation service or discount requested and that has been issued to an individual with a disability by another transit operator.
This section also applies to any dial-a-ride, paratransit, or nonfixed route operator which serves the disabled, but does not apply to a private nonprofit entity which serves the disabled or elderly.
Nothing in this section prohibits a transit operator from issuing its own identification card, except that no such card shall be required to be presented in addition to either a federal Medicare card or a card issued pursuant to Section 22511.55 of the Vehicle Code.
A transit operator, as defined in subdivision (b), which receives funds pursuant to the Mills-Alquist-Deddeh Act (Chapter 4 (commencing with Section 99200)), shall not require that a person requesting transportation be a resident of that transit operator’s service area.
There shall be close coordination between local transit providers and county welfare departments in order to ensure that transportation moneys available for purposes of assisting recipients of aid under Chapter 2 (commencing with Section 11200) of Part 3 of Division 9 of the Welfare and Institutions Code are expended efficiently for the benefit of that population.
In areas where public transit service is available, local transit providers shall give priority, in the use of funds allocated under the CalWORKs program and made available by the county, to the enhancement of public transportation services for welfare-to-work purposes.
In areas where public transit services are unavailable, local transit providers shall give priority, in the use of funds allocated under the CalWORKs program and made available by the county, to the enhancement of transportation alternatives, such as, but not limited to, subsidies or vouchers, van pools, and contract paratransit operations, in order to promote welfare-to-work purposes.
In areas where public transit service is available, local transit providers shall consider giving priority in the use of transit funds to the enhancement of public transportation services for welfare-to-work purposes.
Notwithstanding subdivision (b) of Section 99155, if the Sacramento Regional Transit District offers reduced fares to senior citizens, it shall not be required to also offer reduced fares to disabled persons or disabled veterans at the same rate established for senior citizens.
A reduced fare offered to senior citizens that is not also offered to disabled persons and disabled veterans pursuant to this subdivision shall not be valid beyond the date specified in subdivision (e).
If the Sacramento Regional Transit District reduces fares for senior citizens below the rate for disabled persons or disabled veterans, the district shall not increase fares for disabled persons or disabled veterans.
If the Sacramento Regional Transit District reduces fares for senior citizens below the rate for disabled persons or disabled veterans, the district shall submit a report to the Legislature that includes all of the following information:
The number of people per month who purchase a fare or monthly pass, at a reduced fare that is offered to senior citizens, disabled persons, or disabled veterans, for the year before the implementation of the new rate.
The farebox revenue recovered from the fares and monthly passes described in paragraph (1).
The rate change for fares offered to senior citizens, disabled persons, and disabled veterans.
The number of people affected by the rate change each month.
The cost of a reduced fare for senior citizens, disabled persons, or disabled veterans, before and after the implementation of the reduced fare rate for senior citizens.
A description of any service changes made on or after January 1, 2025.
The amount of farebox revenue collected after January 1, 2025.
For purposes of this section, the following definitions apply:
A change made to routes, including the addition or removal of service on a route.
A change to the frequency of service on a route.
A delay in a project that is intended to improve customer service, including implementation of real-time General Transit Feed Specification.
A change, unrelated to retirements, in staffing levels, including security.
The report to be submitted pursuant to subdivision (b) shall be submitted on or before January 1, 2026, and shall be submitted in compliance with Section 9795 of the Government Code.
This section shall remain in effect only until January 1, 2027, and as of that date is repealed.
For purposes of this section, the following definitions apply:
“Eligible persons” means persons who receive, or who are eligible to receive, paratransit services based on a disability and whose disability cannot reasonably be expected to improve over time, as determined by the person’s qualified licensed medical professional, and whose ability to access the fixed route system cannot reasonably be expected to improve over time, as determined by the transit operator.
“Recertification process” means the process by which a transit operator may require persons who have previously been determined eligible for the federal Americans with Disabilities Act of 1990 (42 U.S.C. Sec. 12101 et seq.) complementary paratransit service to have their eligibility reviewed again.
“Transit operator” means a transit district, municipal operator, county transportation commission, transportation authority, joint powers authority, or other public transit operator that provides, or contracts for the provision of, paratransit service for individuals with disabilities and that receives public funding pursuant to the Mills-Alquist-Deddeh Act (Chapter 4 (commencing with Section 99200)).
On or before January 1, 2027, a transit operator shall establish a streamlined recertification process for eligible persons.
The streamlined recertification process established by a transit operator pursuant to paragraph (1) shall use a telephone interview, mail-in form, teleconference, or online survey and collect for the purposes of verification only the following information:
Physical address.
Mailing address, if different from physical address.
Emergency contact.
Telephone number.
Updated mobility devices.
Status of disability, with identification of any worsening of the person’s disability, any additional disability, any changes to the person’s functional abilities, and any changes to the person’s use of an assistive device.
First and last name.
Date of birth.
A transit operator may also request, as part of the streamlined recertification process, an updated photo of the eligible person if the transit operator requires a photo for its initial eligibility determination.
A transit operator shall require eligible persons to complete the streamlined recertification process established pursuant to this subdivision once every five years.
An eligible person may request recertification at any time and shall complete the recertification every five years thereafter.
On and after June 1, 2027, a transit operator shall only use the streamlined recertification process described in subdivision (b) for eligible persons unless one of the following conditions applies:
The eligible person has moved to a new physical address and the change of physical address is reasonably expected to modify their eligibility for paratransit services.
This section does not prohibit a transit operator from establishing and using a different recertification process for persons who do not meet the definition of paragraph (1) of subdivision (a).
This section shall not prevent a transit operator from contracting the eligibility recertification process for paratransit services, so long as the final decision regarding an eligible person’s eligibility to be recertified for paratransit services is made by the transit operator.
The Legislature intends that dial-a-ride and paratransit services be accessible to disabled persons, as defined in Section 99206.5. It is intended that transportation service be provided for employment, education, medical, and personal reasons. Transportation for individuals with disabilities is a necessity, and allows these persons to fully participate in our society.
The Legislature finds and declares that the term “paratransit,” as used in the federal Americans with Disabilities Act of 1990 (Public Law 101-336), refers to transportation services with specific criteria of quality and quantity, and which are required to be made available to limited classes of persons based on eligibility categories; this is often referred to as “ADA paratransit” or “complementary paratransit.” The Legislature finds and declares that the terms “paratransit” and “dial-a-ride,” as used in the laws of this state, apply to a broader range of transportation services and that not all individuals with disabilities under the laws of this state are eligible for “ADA paratransit” under the federal law.
Each transit operator, for profit or nonprofit, which provides, or contracts for the provision of, dial-a-ride or paratransit service for individuals with disabilities and which receives public funding pursuant to the Mills-Alquist-Deddeh Act (Chapter 4 (commencing with Section 99200)) for that service shall provide the service without regard to either of the following:
Whether the person is a member of a household which owns a motor vehicle.
Whether the place of residence of the person who requests transportation service is within the service area of the provider. To the extent that they are eligible for the specified service requested, all persons requesting transportation service in the service area of the provider shall be provided service on the same terms and at the same price that service is provided to other persons residing within the service area of the provider.
Subdivision (b) does not preclude a provider from offering a subscription service, and does not require a reduction in the amount the provider charges other public or private agencies.
Except as required by the federal Americans with Disabilities Act of 1990 (Public Law 101-336) and federal regulations adopted pursuant thereto or by higher standards prescribed by the laws of this state, nothing in this section requires any transit operator which provides service to individuals with disabilities in a manner consistent with subdivision (b) to make those services available outside the operator’s established operating service area, or requires the operator to make the presentation of identification a condition to using the service.
A transit operator shall honor any current identification card which is valid for the type of transportation service or discount requested and which has been issued to an individual with disabilities by another transit operator.
Any person who believes an operator has violated Section 99155 or 99155.5 may file a report of the alleged violation with the transportation planning agency or county transportation commission. Any individual with disabilities may request the Attorney General to resolve any dispute as to compliance with Section 99155 or this section.
The Transportation Agency, in consultation with public transit operators, shall conduct an assessment of the procedures public transit operators use to provide dial-a-ride and paratransit services to individuals with disabilities who are visiting their service territories and are certified to use another in-state public transit operator’s similar dial-a-ride and paratransit services, to the extent available. The assessment shall include, but not be limited to, timelines and methods for qualifying individuals to submit certification documents, including by electronic submission, to transit operators.
On or before July 1, 2021, the Transportation Agency shall publish the assessment on its internet website.
After conducting and publishing the assessment, the Transportation Agency shall adopt guidelines for the development of a statewide program to enable individuals with disabilities who a public transit operator has certified to use its dial-a-ride and paratransit services to use another in-state public transit operator’s similar dial-a-ride and paratransit services, to the extent available.
Notwithstanding any other provision of law, a transit district may provide compensation to a member of the governing board of the district only for attendance at a meeting of the board or for each day the member is engaged in other district business within or without the district. A member who engages in district business other than attendance at board meetings shall first obtain authorization of the board for reimbursement of travel expenses or other compensation before engaging in that business and shall submit a report thereof to the board for all expenditures.
Notwithstanding any other provision of law, a transit district may not provide any life, accident, or health insurance plan to any member or former member of the governing board of the district who first served as a member of the governing board after January 1, 1989, that exceeds the benefits provided to full-time active or retired district employees. The terms, conditions, or contributions applicable to any plan provided for employees shall also apply to any plan provided for those members of the governing board.
Notwithstanding any other provision of law, a transit district may not establish or contribute to a pension or retirement benefits plan or purchase an annunity for any member of its governing board who first served as a member of the governing board after January 1, 1989. This section does not apply to a deferred compensation plan described in Section 53213 of the Government Code.
Any retirement system established or maintained pursuant to this division for employees of a transit district who are members of a unit appropriate for collective bargaining shall be maintained pursuant to a collective bargaining agreement and this section.
Notwithstanding any other provision of this division, the retirement system and the funds of the system shall be managed and administered by a retirement board composed of equal representation of labor and management. Any deadlock among the members of the board with respect to that management and administration shall be resolved in the manner specified in Section 302 of the federal Labor Management Relations Act, 1947 (29 U.S.C. Sec. 186(c)(5)).
The duties and responsibilities of the retirement board shall be executed in accordance with Section 17 of Article XVI of the California Constitution.
This section does not apply to any public transit district that has, pursuant to a collective bargaining agreement, provided membership for the district’s represented employees in the Public Employees’ Retirement System, a retirement system established pursuant to the County Employees Retirement Law of 1937, or a pension trust subject to the Employee Retirement Income Security Act of 1974 (29 U.S.C. Sec. 1001 et seq.) or any transit district where the membership of the governing board of the transit district is directly elected by the voters.
Any public entity which plans the development of, or which operates, a rail transit system, shall, with respect to any current or future rail transit system, (a) develop motor vehicle parking facilities to serve the system’s passengers at stations planned to be park and ride facilities, and (b) expand private enterprise participation in the development of air space and publicly owned assets to provide those parking facilities.
Space at a publicly owned transportation facility may be leased by competitive bid, taking into consideration affordability and quality of care, to a child care operator who has obtained licensure as required by Section 1596.80 of the Health and Safety Code. Priority for child care services provided by the center shall be given to the children of public agency employees who work at the transportation facility and children of users of the transportation facility.
No state funds shall be provided to any child care operator pursuant to this section unless all of the following conditions are met:
The child care facility is open to children without regard to any child’s religious beliefs or any other factor related to religion.
No religious instruction is included in the child care program.
The space in which the child care program is operated is not utilized in any manner to foster religion during the time it is used for child care.
The Legislature finds and declares that the use of publicly owned transportation facilities for the purpose of furnishing child care services for the benefit of persons using public transit is in the public interest and serves a public purpose.
Notwithstanding any other provision of law, one or more local agencies listed in subdivision (i) of Section 99602 may undertake a study or a joint study concerning the feasibility of extending the commuter rail or intercity rail service described in subdivision (c) of Section 99622 beyond the City of Davis to the City of Dixon.
On and after January 1, 2005, whenever a transit operator improves or replaces a ticket vending machine at a public transit station to include video instructions, the transit operator shall also equip the ticket vending machine with audio instructions that will enable visually impaired persons to follow the visual prompts. State funds made available to the operator through the State Transportation Assistance Program under Section 99312 shall be available for the purposes of this section.
When installing new security systems, a transit agency operated by an operator as defined in Section 99210 shall only purchase and install equipment capable of storing recorded images for at least one year, unless all of the following conditions apply:
The transit agency has made a diligent effort to identify a security system that is capable of storing recorded data for one year.
The transit agency determines that the technology to store recorded data in an economically and technologically feasible manner for one year is not available.
The transit agency purchases and installs the best available technology with respect to storage capacity that is both economically and technologically feasible at that time.
Notwithstanding any other provision of law, videotapes or recordings made by security systems operated as part of a public transit system shall be retained for one year, unless one of the following conditions applies:
The videotapes or recordings are evidence in any claim filed or any pending litigation, in which case the videotapes or recordings shall be preserved until the claim or the pending litigation is resolved.
The videotapes or recordings recorded an event that was or is the subject of an incident report, in which case the videotapes or recordings shall be preserved until the incident is resolved.
The transit agency utilizes a security system that was purchased or installed prior to January 1, 2004, or that meets the requirements of subdivision (a), in which case the videotapes or recordings shall be preserved for as long as the installed technology allows.
Installation of a security system by a transit agency pursuant to this section shall not create a duty to contemporaneously monitor the live video or other data collected by the system.
For purposes of this section, “environmental and public health impacts” means those impacts that affect the health and environment of persons living, working, and attending school in the vicinity of a bus fueling station, including, but not limited to, impacts associated with nuisance odors.
On or before July 1, 2003, the Omnitrans Joint Powers Authority shall contract with an independent third party to prepare and submit to the Legislature and the Governor a report on the environmental and public health impacts of transit bus fueling stations located within the jurisdiction of the authority and owned or operated by the authority. In conducting the assessment, the authority shall hold at least one noticed public hearing in the vicinity of each bus fueling station for the purposes of soliciting input from persons who may be affected by those impacts. The authority shall consult with the South Coast Air Quality Management District and other appropriate federal, state, local agencies, and community groups representing residents of the affected areas, in conducting the assessment.
The Omnitrans Joint Powers Authority shall solely use state funds allocated to it or its member agencies pursuant to the State Transportation Assistance Program under Section 99313.3 in order to comply with this section.
If an evacuation order is issued that covers all or a portion of a public transit operator’s service area, the public transit operator shall authorize passengers to board public transit vehicles with their pets in the area covered by the evacuation order, consistent with best practices developed pursuant to subdivision (b).
The Office of Emergency Services and the Department of Food and Agriculture, in consultation with public transit operators and county emergency management officials, shall develop best practices for allowing pets on public transit vehicles serving areas subject to an evacuation order. The best practices shall not prohibit a public transit operator from enacting policies that ensure the safety of transit riders.
For purposes of this section, the following definitions apply:
“Evacuation order” means an order from the Governor, or a county emergency management official, county sheriff, chief of police, or fire marshal, under which persons subject to the order are encouraged to relocate outside of the geographic area covered by the order due to an imminent danger resulting from an earthquake, fire, flood, riot, or other natural or manmade disaster.
“Pet” means a cat or a dog as those terms are defined in Section 1799.109 of the Health and Safety Code.
A person shall not do any of the following with respect to the property, facilities, or vehicles of a transit district or the property, facilities, or vehicles upon which the San Francisco Bay Area Rapid Transit District owes policing responsibilities to a local government pursuant to an operations and maintenance agreement or similar interagency agreement:
Operate, interfere with, enter into, or climb on or in, the property, facilities, or vehicles owned or operated by the transit district, or the property, facilities, or vehicles upon which the San Francisco Bay Area Rapid Transit District owes policing responsibilities to a local government pursuant to an operations and maintenance agreement or similar interagency agreement, without the permission or approval of the transit district.
Interfere with the operator or operation of a transit vehicle, or impede the safe boarding or alighting of passengers.
Extend any portion of the body through a window opening of a transit vehicle in a manner that may cause harm or injury.
Throw an object from a transit vehicle.
Commit an act or engage in a behavior that may, with reasonable foreseeability, cause harm or injury to any person or property.
Violate a notice, prohibition, instruction, or direction on a sign that is intended to provide for the safety and security of transit passengers, or the safe and secure operation of the transit system.
Knowingly give false information to a district employee, or contracted security officer, engaged in the enforcement of a district ordinance or a state law, or otherwise obstruct the issuance of a citation for the violation of a district ordinance or a state law.
Violate any of the conditions established by a transit district ordinance under which a passenger may board a transit vehicle with a bicycle and where that bicycle may be stowed on the transit vehicle.
A violation of this section is an infraction under Section 19.8 of the Penal Code punishable by a fine not exceeding seventy-five dollars ($75), and a violation by a person after a second conviction is punishable by a fine not exceeding two hundred fifty dollars ($250) or by community service that does not conflict with the violator’s hours of school attendance or employment for a total time not to exceed 48 hours over a period not to exceed 60 days.
A transit district shall provide reasonable notification to the public of the activities prohibited by this section and the penalties for violations of those prohibitions.
This section does not prohibit a person from engaging in activities that are protected under the laws of the United States or of this state, including, but not limited to, picketing, demonstrating, or distributing handbills.
Revenue from fines imposed pursuant to subdivision (c) shall not be distributed or allocated to the transit agency issuing citations under this section. Fine revenue instead shall be allocated to the other entities eligible to receive those funds under existing law.
A transit district may issue a prohibition order to any person to whom any of the following applies:
On at least three separate occasions within a period of 90 consecutive days, the person is cited for an infraction committed in or on a vehicle, bus stop, or train or light rail station of the transit district or a property, facility, or vehicle upon which the San Francisco Bay Area Rapid Transit District owes policing responsibilities to a local government pursuant to an operations and maintenance agreement or similar interagency agreement for an act that is a violation of paragraph (2) or (5) of subdivision (a) of Section 99170 of this code or paragraph (1), (2), (3), or (4) of subdivision (d) of Section 640 or Section 640.5 of the Penal Code.
The person is arrested or convicted for a misdemeanor or felony committed in or on a vehicle, bus stop, or light rail station of the transit district for acts involving violence, threats of violence, lewd or lascivious behavior, or possession for sale or sale of a controlled substance.
The person is convicted of a violation of Section 11532 of the Health and Safety Code.
A person subject to a prohibition order may not enter the property, facilities, or vehicles of the transit district or the property, facilities, or vehicles upon which the San Francisco Bay Area Rapid Transit District owes policing responsibilities to a local government pursuant to an operations and maintenance agreement or similar interagency agreement for a period of time deemed appropriate by the transit district, provided that the duration of a prohibition order shall not exceed the following, as applicable:
Thirty days if issued pursuant to subparagraph (A) of paragraph (1), provided that a second prohibition order within one year shall not exceed 90 days, and a third or subsequent prohibition order within one year shall not exceed 180 days.
Thirty days if issued pursuant to an arrest pursuant to subparagraph (B) of paragraph (1). Upon conviction of a misdemeanor offense, the duration of the prohibition order for the conviction, when added to the duration of the prohibition order for the initial arrest, if any, shall not exceed 180 days. Upon conviction of a felony offense, the duration of the prohibition order for the conviction, when added to the duration of the prohibition order for the initial arrest, if any, shall not exceed one year.
A prohibition order issued pursuant to this subdivision shall not be effective unless the transit district first affords the person an opportunity to contest the transit district’s proposed action in accordance with procedures adopted by the transit district for this purpose. A transit district’s procedures shall provide, at a minimum, for the notice and other protections set forth in subdivisions (b) and (c), and the transit district shall provide reasonable notification to the public of the availability of those procedures.
A notice of a prohibition order issued under subdivision (a) shall set forth a description of the conduct underlying the violation or violations giving rise to the prohibition order, including reference to the applicable statutory provision, ordinance, or transit district rule violated, the date of the violation, the approximate time of the violation, the location where the violation occurred, the period of the proposed prohibition, and the scope of the prohibition. The notice shall include a clear and conspicuous statement indicating the procedure for contesting the prohibition order. The notice of prohibition order shall be personally served upon the violator. The notice of prohibition order, or a copy, shall be considered a record kept in the ordinary course of business of the transit district and shall be prima facie evidence of the facts contained in the notice establishing a rebuttable presumption affecting the burden of producing evidence. For purposes of this paragraph, “clear and conspicuous” means in larger type than the surrounding text, or in contrasting type, font, or color to the surrounding text of the same size, or set off from the surrounding text of the same size by symbols or other marks that call attention to the language.
For purposes of this section, “personal service” means any of the following:
In-person delivery.
Delivery by any form of mail providing for delivery confirmation, postage prepaid, to at least one address provided by the person being served, including, but not limited to, the address set forth in any citation or in court records.
Any alternate method approved in writing by the transit district and the person being served.
If a person served with a notice of prohibition order is not able, or refuses, to provide a mailing address, the notice of prohibition order shall set forth the procedure for obtaining any letters, notices, or orders related to the prohibition order from the administrative offices of the transit district. For purposes of this section, delivery shall be deemed to have been made on the following date, as applicable:
On the date of delivery, if delivered in person.
On the date of confirmed delivery, for any delivery by mail.
For any alternate method of service, as provided in the writing specifying the alternate method.
Proof of service of the notice shall be filed with the transit district.
If a person contests a notice of prohibition order, the transit district shall proceed in accordance with subdivision (c). If the notice of prohibition order is not contested within 10 calendar days after delivery by personal service, the prohibition order shall be deemed final and shall go into effect, without further action by the transit district, for the period of time set forth in the order.
All prohibition orders shall be subject to an automatic stay and shall not take effect until the latest of the following:
Eleven calendar days after delivery of the prohibition order by personal service.
If an initial review is timely requested under paragraph (1) of subdivision (c), 11 calendar days after delivery by personal service of the results of the review.
If an administrative hearing is timely requested under paragraph (3) of subdivision (c), the date the hearing officer’s decision is delivered by personal service.
The person requesting the hearing shall have the choice of a hearing by mail or in person. An in-person hearing shall be conducted within the jurisdiction of the transit district.
The administrative hearing shall be conducted in accordance with written procedures established by the transit district and approved by the governing body or chief executive officer of the transit district. The hearing shall provide an independent, objective, fair, and impartial review of the prohibition order.
The administrative review shall be conducted before a hearing officer designated to conduct the review by the transit district’s governing body or chief executive officer. In addition to any other requirements, a hearing officer shall demonstrate the qualifications, training, and objectivity prescribed by the transit agency’s governing body or chief executive officer as are necessary to fulfill and that are consistent with the duties and responsibilities set forth in this subdivision. The hearing officer’s continued service, performance evaluation, compensation, and benefits, as applicable, shall not be directly or indirectly linked to the number of prohibition orders upheld by the hearing officer.
The person who issued the notice of prohibition order shall not be required to participate in an administrative hearing, unless participation is requested by the person requesting the hearing. The request for participation shall be made at least five calendar days before the date of the hearing and may be made by telephone, in writing, or in person. The notice of prohibition order, in proper form, shall be prima facie evidence of the violation or violations pursuant to subdivision (a) establishing a rebuttable presumption affecting the burden of producing evidence.
In issuing a decision, the hearing officer shall determine whether the prohibition order meets the requirements of subdivision (a) and, unless the person has been convicted of the offense or offenses, whether the offense or offenses for which the person was cited or arrested are proven by a preponderance of the evidence. Based upon these findings, the hearing officer may uphold the prohibition order in whole, determine that the prohibition order is not adequately supported, or cancel or modify the prohibition order in the interest of justice. The hearing officer shall cancel a prohibition order if they determine that the person did not understand the nature and extent of their actions or did not have the ability to control their actions. If the person is dependent upon the transit system for trips of necessity, including, but not limited to, travel to or from medical or legal appointments, school or training classes, places of employment, or obtaining food, clothing, and necessary household items, the transit district shall modify a prohibition order to allow for those trips. A person requesting a cancellation or modification in the interest of justice shall have the burden of establishing the qualifying circumstances by a preponderance of the evidence.
The hearing officer’s decision following the administrative hearing shall be delivered by personal service.
A person aggrieved by the final decision of the hearing officer may seek judicial review of the decision within 90 days of the date of delivery of the decision by personal service, as provided by Section 1094.6 of the Code of Civil Procedure.
A person issued a prohibition order under subdivision (a) may, within 10 calendar days of the date the order goes into effect under paragraph (6) of subdivision (b), request a refund for any prepaid fare media rendered unusable in whole or in part by the prohibition order, including, but not limited to, monthly passes. If the fare media remain usable for one or more days outside the period of the prohibition order, the refund shall be prorated based on the number of days the fare media will be unusable. The issuance of a refund may be made contingent on surrender of the fare media.
For purposes of this section, “transit district” means the Sacramento Regional Transit District, the Los Angeles County Metropolitan Transportation Authority, the Fresno Area Express, the San Francisco Bay Area Rapid Transit District, the Santa Clara Valley Transportation Authority, or the Santa Monica Department of Transportation.
Before exercising the authority given in subdivision (a) of Section 99171 to issue prohibition orders, a transit district shall do all of the following:
Establish an advisory committee for the purpose of evaluating the procedures for, and issuance of, prohibition orders and recommending a course of training for personnel charged with issuing and enforcing prohibition orders.
Ensure that personnel to be charged with issuing and enforcing prohibition orders have received training as recommended by the advisory committee.
Provide reasonable notification to transit district riders that persons who engage in disorderly conduct may be subject to a prohibition order barring the person from the transit district’s property, facilities, or vehicles for a period of up to one year. “Reasonable notification” may include, but is not limited to, information on the transit district’s internet website, in written materials, at transit stations, and on citations issued by the transit district of the types of conduct that may result in issuance of a prohibition order.
The advisory committee shall be composed of at least five members appointed by the legislative body of the transit district. At least one of the members of the advisory committee shall have experience working with individuals with psychiatric, developmental, or other disabilities, at least one member shall be a youth advocate, and at least one member shall have law enforcement experience.
The advisory committee shall be tasked, at a minimum, with all of the following:
Providing recommendations, in consultation with the county mental health director within the service area of the transit district, regarding the type and extent of training that should be undertaken by individuals with responsibility for issuing and enforcing prohibition orders, with particular emphasis on training designed to assist those individuals in identifying and interacting with persons who are homeless or who have psychiatric, developmental, or other disabilities.
Identifying, in consultation with the county mental health director within the service area of the transit district, services and programs to which persons who are homeless or who have psychiatric, developmental, or other disabilities may be referred by transit district enforcement personnel before or in conjunction with issuance of a prohibition order.
Monitoring the issuance of prohibition orders to assist the transit district in ensuring compliance with Section 51 of the Civil Code.
Providing the governing board of the transit district and the Legislature with an annual report summarizing the number of prohibition orders that were issued by the transit district during the preceding year, including, but not limited to, the types and numbers of citations by category, and the number of exclusion orders appealed, the appeals granted, the reasons granted, and other relevant information directly related to those orders.
The transit district may use an existing advisory committee to fulfill the requirements of this section, provided that the composition and purpose of the existing advisory committee meet or are modified to meet the requirements of this section.
For purposes of this section, “transit district” means the Sacramento Regional Transit District, the Los Angeles County Metropolitan Transportation Authority, the Fresno Area Express, the San Francisco Bay Area Rapid Transit District, the Santa Clara Valley Transportation Authority, or the Santa Monica Department of Transportation.
Before the procurement of a new bus to be used in revenue operations, a public transit operator shall take into consideration recommendations of, and best practices standards developed by, the exclusive representative of the recognized organization representing bus operators of the transit operator for the following purposes:
To reduce the risk of assault on bus operators.
To prevent accidents caused by blind spots created by bus equipment or bus design.
To enhance the safety of passengers, bus operators, or other vehicles or pedestrians that the bus may come into contact with while in service.
Nothing in this section shall be construed to require a public transit operator to implement specific recommendations.
A public entity that operates, or contracts for the operation of, a commuter rail system shall ensure that each train has an automated external defibrillator (AED) as part of its safety equipment subject to the requirements in Section 1797.196 of the Health and Safety Code. As used in this subdivision, “commuter rail system” does not include intercity passenger rail services, including state-funded intercity passenger rail services managed under an interagency transfer agreement by the LOSSAN Rail Corridor Agency, the San Joaquin Joint Powers Authority, or the Capitol Corridor Joint Powers Authority, and does not include light rail or rapid transit services managed by local agencies.
An affected public entity may provide training for their employees on the use of the AEDs as part of their regularly scheduled safety or other training sessions.
An affected public entity shall install AEDs pursuant to this section by July 1, 2020.
The Peninsula Corridor Joint Powers Board shall be exempt from paragraph (1) and shall instead ensure that trainsets procured as part of the Caltrain Electrification Project are equipped with AEDs.
An affected public entity that acquires an AED for emergency care pursuant to this section shall not be liable for any civil damages resulting from any acts or omissions in the rendering of the emergency care by use of an AED if the public entity has complied with paragraph (1) of subdivision (b) of Section 1797.196 of the Health and Safety Code.
For purposes of this section, the following definitions apply:
“Lactation room” means a room or other location open to members of the public to express breast milk in a private and secure location that meets both of the following conditions:
Includes, at a minimum, a chair, an electrical outlet, and a shelf, table, or other surface other than the floor upon which equipment used to express breast milk can be placed.
Is located outside of the confines of a public restroom.
“Renovation” means the reconstruction of more than 25 percent of the space in the indoor area of a multimodal transit station, exclusive of train platforms, walkways, and track areas.
“Multimodal transit station” means the following rail stations:
Anaheim Regional Transportation Intermodal Center in the City of Anaheim.
Bakersfield Station in the City of Bakersfield.
Jack London Square Station in the City of Oakland.
Los Angeles Union Station in the City of Los Angeles.
Robert J. Cabral Station in the City of Stockton.
Sacramento Valley Station in the City of Sacramento.
Salesforce Transit Center in the City of San Francisco.
San Jose Diridon Station in the City of San Jose.
Santa Fe Depot in the City of San Diego.
Santa Fe Passenger Depot in the City of Fresno.
A rail station that meets all of the following criteria:
The rail station supports the operation of an intercity rail service established pursuant to Article 5 (commencing with Section 14070) of Chapter 1 of Part 5 of Division 3 of Title 2 of the Government Code, or the rail station is, or is planned to be, served by California’s high-speed rail system pursuant to the Safe, Reliable High-Speed Passenger Train Bond Act for the 21st Century (Chapter 20 (commencing with Section 2704) of Division 3 of the Streets and Highways Code).
The rail station serves as a stop or transfer point between intercity rail or high-speed rail and local or regional rail or bus service.
The rail station has a publicly accessible indoor area of no less than 5,000 square feet and includes a public restroom.
The rail station has staff onsite during hours of operation.
A multimodal transit station that begins construction or renovation on or after January 1, 2021, shall include a lactation room.
For the purpose of this section, the following definitions apply:
“Institute” means the Mineta Transportation Institute at San Jose State University.
“Street harassment” means words, gestures, or actions directed at a specific person in a public place, without the consent of that person, because of a characteristic listed or defined in Section 11135 of the Government Code, that the person experiences as intimidating, alarming, terrorizing, or threatening to their safety. For the purposes of this section, street harassment because of age shall include any chronological age.
“Survey data” means information regarding public transit riders and their experiences using public transit, including, but not limited to, demographic information about riders and information about their experiences with safety, including, but not limited to, street harassment.
“Transit operator” means the 10 transit operators, as defined in Section 99210, with the most unlinked passenger trips in 2019 in the state, according to the National Transit Database.
On or before December 31, 2023, the institute shall develop and make available on its internet website a survey for the purpose of promoting consistency in the collection of survey data to inform efforts to improve the safety of riders and reduce street harassment on public transit.
The survey shall include questions asking for the following information:
Demographic information regarding riders, including their race, ethnicity, religion, age, disability, income, primary language, sex, gender, gender identity, gender expression, and sexual orientation.
Information regarding a rider’s experiences with safety while waiting at public transit stops and riding public transit, including:
Whether a rider experiences street harassment.
The frequency with which a rider experiences street harassment.
The type of street harassment experienced by a rider.
The actual or perceived characteristics that serve as the basis for street harassment experienced by a rider.
Where and when a rider experiences street harassment, including on what mode of transit.
Whether a rider experiencing street harassment is alone or accompanied by others.
Whether a rider experiencing street harassment reports the incident, and, if so, to whom and the response received.
The impact of street harassment on a rider, including whether and how they change their use of transit.
A rider’s perceptions of safety while using transit.
In developing the survey, the institute shall consult with organizations representing subpopulations impacted by street harassment and with transit operators. The institute shall consider existing efforts by a transit operator to collect survey data and make recommendations on how a transit operator may use or update available survey data instead of collecting new survey data.
For purposes of this section, the terms “street harassment,” “survey data,” and “transit operator” have the same meanings as defined in Section 99177.
On or before December 31, 2024, a transit operator shall collect and publish survey data, in accordance with this section, to the extent feasible with the funding it receives to implement this section from the Department of Transportation pursuant to paragraph (2), for the purpose of informing their efforts to improve the safety of riders and reduce street harassment on public transit.
On or before July 1, 2024, the Department of Transportation shall enter into a funding agreement with a transit operator to collect and publish the survey data described in paragraph (1).
A transit operator shall collect, at a minimum, the information described in paragraph (2) of subdivision (b) of Section 99177.
A transit operator may, but is not required to, use the survey made available pursuant to Section 99177 and may ask additional questions beyond those in the survey.
A transit operator shall conduct outreach activities with subpopulations of riders who are underrepresented in surveys and impacted by street harassment to gain insight into the perspectives of these riders based on their experiences. Activities may include focus groups, participatory workshops, or other methods of engaging riders. Subpopulations may include, but are not limited to, women riders, non-English-speaking riders, LGBTQ+ riders, and riders with disabilities.
A transit operator may collect survey data in multiple languages to reach limited-English-proficient riders impacted by street harassment. The languages may be determined by existing data on riders or the top non-English languages used by limited-English-proficient persons in the community served by the transit operator according to the most recent American Community Survey by the United States Census Bureau.
A transit operator shall publish and make publicly available on its internet website all survey data collected pursuant to this section, including the information described in paragraph (2) of subdivision (b) of Section 99177, as required by subdivision (c).
Notwithstanding paragraph (1), a transit operator shall not publish any personally identifiable information.
A transit operator shall promptly notify the Governor and the Legislature of the publication of the survey data.
Notwithstanding anything in this section to the contrary, any information described in paragraph (2) of subdivision (b) of Section 99177 collected by a transit operator in the five years before the effective date of this section shall be deemed to be survey data collected by the transit operator pursuant to this section, and any outreach activities conducted by a transit operator to collect that information in the five years before the effective date of this section shall be deemed to have been conducted by the transit operator pursuant to this section.
Nothing in this section shall be construed to create new or additional liability for a transit operator for failing to respond to an incident of street harassment.
CHAPTER 4. Transportation Development [99200. - 99420.]
ARTICLE 1. General Provisions and Definitions [99200. - 99217.]
This chapter shall be known and may be cited as the “Mills-Alquist-Deddeh Act.”
Unless the context otherwise requires, the definitions given in this article shall govern construction of this chapter.
“Claimant” or any derivative term, such as “applicant,” means an operator, city, county, or consolidated transportation service agency.
“City” means a city within the county having the fund from which the disbursement will be made.
“Commission” means the California Transportation Commission.
“Consolidated transportation service agency” means an agency designated pursuant to subdivision (a) of Section 15975 of the Government Code.
“Controller” means the Controller of the State of California.
“County” includes a city and county.
“Department” means the Department of Transportation.
“Director” means the Director of Transportation.
“Fare revenues” means the revenue object classes 401, 402, and 403 as specified in Section 630.12 of Title 49 of the Code of Federal Regulations, as now or as may hereafter be amended.
“Fund” means the local transportation fund established by a county under Article 11 (commencing with Section 29530) of Chapter 2 of Division 3 of Title 3 of the Government Code.
“Disabled person” means any individual who by reason of illness, injury, age, congenital malfunction, or other permanent or temporary incapacity or disability, including, but not limited to, any individual confined to a wheelchair, is unable, without special facilities or special planning or design, to utilize public transportation facilities and services as effectively as a person who is not so affected.
As used in this section, a temporary incapacity or disability is an incapacity or a disability which lasts more than 90 days.
“Included municipal operator” means a city or county which is included, in whole or in part, within a transit district or which has been extended the authority to join a transit district by that district’s enabling legislation, and in which city or county public transportation services have continuously been provided, since at least January 1, 1971, by the city or county, by a nonprofit corporation or other legal entity wholly owned by the city or county, or by the University of California.
“Included municipal operator” also means the City and County of San Francisco and the Counties of Alameda and Contra Costa with respect to any portion of the unincorporated area thereof, and any city in those counties, which is outside the area of the Alameda-Contra Costa Transit District and which is not receiving adequate local public transportation services, as determined by the Metropolitan Transportation Commission, from any of the transit districts which includes the county or city, taking into consideration, among other things, the amount of such services needed in the county or city, the cost to provide such services, and the amount of such services provided in other areas of the transit district as compared to their needs.
“Included municipal operator” also means any city within the County of Sacramento which (1) is outside the activated boundaries of the Sacramento Regional Transit District, (2) contracts with the district for transit services, and (3) provides local transit services within the city that the Sacramento Area Council of Governments annually determines can be better provided by the city than the district, taking into consideration, among other things, the amount and the nature of the services required in the city, the ability of the district to provide the services, the coordination of the services with district services, the remoteness of the city in relation to other district services, the cost of providing the services, the funds available to provide the services, and the amount of services provided in other areas of the district compared to their needs.
“Included municipal operator” also means any city or unincorporated area within the County of Los Angeles (1) that is not receiving adequate local public transportation services, as determined by the Los Angeles County Metropolitan Transportation Authority, from either the Southern California Rapid Transit District or any currently “included municipal operator” as defined in this section, and (2) that meets the criteria established by the Los Angeles County Metropolitan Transportation Authority, taking into consideration, among other things, the cost to provide such services, the amount of such services needed in the county or city, the funds available to provide such services, and the amount of such services provided in other areas of the county as compared to their needs.
In Los Angeles County, an “eligible municipal operator” is a transit operator that has been designated eligible to receive formula-equivalent funds allocable for transit operating purposes, other than funds specifically included in the formula allocation program.
“Included transit district” means any of the following which has operated a public transportation system since at least January 1, 1971:
A transit district whose boundaries are contained entirely within those of a larger transit district.
A district organized pursuant to Part 3 (commencing with Section 27000) of Division 16 of the Streets and Highways Code.
“Municipal operator” means a city or county, including any nonprofit corporation or other legal entity wholly owned or controlled by the city or county, which operates a public transportation system, or which on July 1, 1972, financially supported, in whole or in part, a privately owned public transportation system, and which is not included, in whole or in part, within an existing transit district.
“Municipal operator” also means any county which is located in part within a transit district and which operates a public transportation system in the unincorporated area of the county not within the area of the district.
“Operates” for purposes of Sections 99209 and 99215, and “operation” for purposes of paragaraph (1) of subdivision (b) of Section 99289, mean that the operator owns or leases the equipment, establishes routes and frequency of service, regulates and collects fares, and otherwise controls the efficiency and quality of the operation of the system, but does not require that operators of rolling stock be employees of a public agency.
“Operator” means any transit district, included transit district, municipal operator, included municipal operator, or transit development board.
“Operator” also means the San Joaquin Regional Rail Commission for operation of commuter rail services.
“Public transportation system” means any system of an operator which provides transportation services to the general public by any vehicle which operates on land or water, regardless of whether operated separated from or in conjunction with other vehicles.
“Ridesharing services” means a comprehensive organizational effort which is designed to reduce the number of vehicles on the highways during peak travel periods within a defined area by encouraging the planning and marketing of high-occupancy vehicle facilities, increases in the number of passengers per vehicle in vehicles used for ridesharing, alternative work schedules, and other transportation demand management strategies among employers and commuters.
“Secretary” means the Secretary of Transportation.
“Transit district” means a public district organized pursuant to state law and designated in the enabling legislation as a transit district or a rapid transit district.
“Transportation planning agency” means the entity designated in Section 29532 of the Government Code.
“Transportation planning agency” also includes, for purposes of this chapter, the county transportation commissions created in the Counties of Los Angeles, Orange, Riverside, San Bernardino, and Ventura pursuant to Division 12 (commencing with Section 130000).
“Transportation planning agency” also includes, for purposes of this chapter, the Imperial County Transportation Commission in Imperial County.
“Transit development board” means a public entity created pursuant to state law and designated in the enabling legislation as a transit development board, including, solely for purposes of submission of claims, receipt of funds, separate annual reporting to the Controller, and provision of service as an operator under this chapter, any nonprofit corporation or other legal entity wholly owned or controlled by the transit development board which operates a public transportation system.
“Urbanized area” means such an area as defined by Section 101 of Title 23 of the United States Code.
ARTICLE 2. Findings and Declarations [99220. - 99222.]
The Legislature finds and declares as follows:
Public transportation is an essential component of the balanced transportation system which must be maintained and developed so as to permit the efficient and orderly movement of people and goods in the urban areas of the state. Because public transportation systems provide an essential public service, it is desirable that such systems be designed and operated in such a manner as to encourage maximum utilization of the efficiencies of the service for the benefit of the total transportation system of the state and all the people of the state, including the elderly, the disabled, the youth, and the citizens of limited means.
The fostering, continuance, and development of public transportation systems are a matter of state concern. Excessive reliance on the private automobile for transportation has caused air pollution and traffic congestion in California’s urban areas, and such pollution and congestion are not confined to single incorporated areas but affect entire regions. Furthermore, public transportation systems which are not designed so as to be usable by disabled persons foster increased welfare costs and the waste of human resources. Thus, the Legislature has elected to deal with the multiple problems caused by lack of adequate public transportation on a regional basis through the counties, with coordination of the programs being the responsibility of the state pursuant to contract with county governments.
While providing county assistance to a particular transportation system may not be of primary interest and benefit to each and every taxpayer in a county, providing an integrated and coordinated system to meet the public transportation needs of an entire county will benefit the county as a whole. It is the purpose of this chapter to provide for such systems in those counties where they are needed.
The local transportation funds authorized by Article 11 (commencing with Section 29530) of Chapter 2 of Division 3 of Title 3 of the Government Code are made possible by the imposition of the state’s sales and use taxes on motor vehicle fuel, which allows for a reduction in state taxes without a corresponding loss in revenue. By authorizing counties to increase their sales and use taxes, an additional source of revenue has been made available for public transportation within such counties. Applicants for a disbursement from a local transportation fund shall only be eligible for an allocation from the fund of the county in which such transportation is provided.
It is the intent of the Legislature to improve existing public transportation services and encourage regional public transportation coordination. The Legislature recognizes that in the Southern California Rapid Transit District a unique factual situation exists where several municipal bus systems are providing essential local transportation services within the operating territory of the district, which was created by the Legislature to provide areawide coordinated public transportation services. Within the Southern California Rapid Transit District, as with all transportation service improvements in the County of Los Angeles, the Los Angeles County Metropolitan Transportation Authority shall be the governmental entity responsible to establish a unified or officially coordinated public transportation system as part of the comprehensively planned development of the urban area. Both the Southern California Rapid Transit District and the included municipalities that operate bus systems within the jurisdiction of the district are permitted to file claims pursuant to this chapter upon the local transportation fund of the County of Los Angeles; provided, however, any approved claim shall not be allowed for the purpose of the establishment by the included municipal operator after January 1, 1980, of new transportation services that do not meet the criteria established by the Los Angeles County Metropolitan Transportation Authority for the development of new services. It is the intent of the Legislature that the Southern California Rapid Transit District should not be inhibited in its effort to improve transit services within the region by the expansion outside the reserved service areas of the several municipal bus systems of the involved municipalities. The policy of the Legislature is that new services to meet public transportation needs outside of the municipalities presently operating bus systems which do not compete with, or divert patronage from, an existing operating bus system of an included municipal applicant under Section 99280, shall be provided and controlled by the Southern California Rapid Transit District, in complete cooperation and coordination with the Los Angeles County Metropolitan Transportation Authority, in its role as the responsible public agency for providing public transportation systems and facilities within the region.
The Legislature hereby finds and declares that:
It is in the interest of the state that funds available for transit development be fully expended to meet the transit needs that exist in California.
Such funds be expended for physical improvement to improve the movement of transit vehicles, the comfort of the patrons, and the exchange of patrons from one transportation mode to another.
ARTICLE 3. Local Transportation Funds [99230. - 99251.]
The designated transportation planning agency shall, from an analysis and evaluation of the total amount anticipated to be available in the local transportation fund and the relative needs of each claimant for the purposes for which the fund is intended, and consistent with the provisions of this chapter, annually determine the amount to be allocated to each claimant.
All operators and city or county governments with responsibility for providing municipal services to a given area collectively may file claims for only those moneys that represent that area’s apportionment.
The term “apportionment” has reference to that proportion of the total annual revenue anticipated to be received in the fund that the population of the area bears to the total population of the county.
The term “area” means:
With reference to a transit district, the entire area stated in its enabling legislation or franchise, excluding cities therein which have retained the right to join the district at a later time.
With reference to a transit development board, the entire area stated in its enabling legislation, including the municipalities therein which operated bus systems prior to the creation of the board and subsequently conveyed those systems to the board.
With reference to a county government, the unincorporated area of the county.
With reference to a city government, the corporate area of the city.
With reference to the City and County of San Francisco and the Counties of Alameda and Contra Costa, the unincorporated area thereof (and with reference to a city in those counties, the corporate area of the city) which is outside the area of the Alameda-Contra Costa Transit District and which is not receiving adequate local public transportation services, as determined by the Metropolitan Transportation Commission pursuant to subdivision (b) of Section 99207.
Where a transit district, a transit development board, or a county or city, provides public transportation services beyond its boundaries, its area, for purposes of this section, shall also include:
All of that area within one-half mile of any route which extends beyond its boundaries.
All of the corporate area of a city to which it provides those services pursuant to contract or prior express authority of the secretary.
The transportation planning agency may rely, in its determination of populations, on estimates which are used by the Controller for distributing money to cities under Section 2107 of the Streets and Highways Code and to counties under Section 11005 of the Revenue and Taxation Code, and may contract with the Department of Finance or other appropriate state agency for an annual determination of those population estimates as may be necessary.
With reference to the County of Riverside, the area within the jurisdiction of the transit operator established by the joint exercise of powers of one or more cities and the County of Riverside. The area within the jurisdiction of the transit operator shall be as it existed on January 1, 1981, as determined by the Riverside County Transportation Commission.
With reference to the County of San Bernardino, the area within the jurisdiction of the transit operator established by the joint exercise of powers of one or more cities, including the most populous city, and the County of San Bernardino. The area within the jurisdiction of the transit operator shall be as it existed on January 1, 1985, as determined by the San Bernardino County Transportation Commission.
With reference to the County of Monterey, the area including the Correctional Training Facility, even if annexed by the City of Soledad.
With reference to the County of Del Norte, the area including the Pelican Bay State Prison, even if annexed by the City of Crescent City.
With reference to the County of Imperial, the area including the Calipatria State Prison, even if annexed by the City of Calipatria.
With reference to the County of Riverside, the area including the Chuckawalla Valley State Prison, even if annexed by the City of Blythe.
With reference to the County of Imperial, the area including the California State Prison, Centinela, even if annexed by either the City of El Centro or the City of Imperial.
With reference to the County of Madera, the area including the Central California Women’s Facility and the Valley State Prison, even if annexed by the City of Chowchilla.
Except in the County of Los Angeles, the transportation planning agency, notwithstanding Section 99231, may approve the claim filed for an unincorporated area by an operator which is serving that area pursuant to a contract with the county, even though the amount of the claim exceeds the apportionment for the area, if the amount is approved by the county.
For counties with a population of 500,000 or more, as determined by the 1970 federal decennial census, but excluding counties with more than 4,500 miles of maintained county roads as of 1970, the amount representing the apportionments of the areas of all operators shall be available solely for claims for Section 99234 purposes and for Article 4 (commencing with Section 99260) and Article 4.5 (commencing with Section 99275) purposes, and any of those moneys not allocated in any year shall be available for those claims in subsequent years.
Notwithstanding Section 99232, for each county with a population of less than 500,000 as of the 1970 federal decennial census, but with a population of 500,000 or more as of the 2000 federal decennial census, or a county whose population is 500,000 or more at a subsequent decennial census, the apportionment to the areas within the urbanized areas of the county, as defined for purposes of the 2000 federal decennial census and each census thereafter, shall be available solely for claims for Article 4 (commencing with Section 99260) and Article 4.5 (commencing with Section 99275) purposes. In a county subject to this section, the apportionment for areas outside of the urbanized area of the county may be used for claims for Article 4 (commencing with Section 99260), Article 4.5 (commencing with Section 99275), and Article 8 (commencing with Section 99400) purposes, providing that allocations under Article 8 (commencing with Section 99400) shall be subject to the unmet needs process as prescribed by Section 99401.5.
The apportionment attributable to the unincorporated area within an urbanized area shall be determined by the proportion that the urbanized area’s unincorporated area population bears to the total unincorporated population times the total apportionment attributable to the unincorporated area.
For a county that is subject to this section, this section shall not apply to that county until July 1, 2014.
The population of cities within an urbanized area shall be based on the city and county population estimates published annually by the Department of Finance.
This section shall become operative on July 1, 2014.
Notwithstanding Section 99231, and subject to subdivision (a) of Section 99232.5, the apportionment area for the Sacramento Regional Transit District includes all of the incorporated and unincorporated area of the County of Sacramento, excluding cities in the county that have retained the right to join the district at a later time. However, the apportionment restriction in Section 99232 only applies to the area of the Sacramento Regional Transit District described in subdivision (a) of Section 99231.
The County of Sacramento may also file a claim under Article 8 (commencing with Section 99400) for the apportionment not subject to the restriction in Section 99232. However, a claim for the purposes of subdivision (a) of Section 99400 shall not be approved unless it is determined by the Sacramento Area Council of Governments, at a public hearing for which 15 days’ notice has been given pursuant to Section 6061 of the Government Code, that there are no unmet transit needs, as defined in Section 99401.5, within the area of the Sacramento Regional Transit District described under subdivision (a) of Section 99231.
This section shall become operative on July 1, 1994.
Notwithstanding Section 99232, cities within the County of Sacramento which are outside the activated boundaries of the Sacramento Regional Transit District, but which provide transit service or which contract with the district for transit service, may also file claims under Article 8 (commencing with Section 99400) if it is determined by the Sacramento Area Council of Governments, at a public hearing for which 15 days’ notice has been given pursuant to Section 6061 of the Government Code, that the transit needs of these cities can be met with use of an amount less than the total apportionment of these cities.
With respect to such a city, not less than 25 percent of its apportionment shall be allocated for Article 4 (commencing with Section 99260) purposes.
Notwithstanding Section 99232, the County of San Diego may also file claims under Article 8 (commencing with Section 99400) for an unincorporated area not served by the San Diego Metropolitan Transit Development Board or the North San Diego County Transit Development Board if all of the following conditions are met:
The San Diego Association of Governments, at a public hearing for which 15 days’ notice has been given pursuant to Section 6061 of the Government Code, finds that the transit needs of that unincorporated area can be met by using an amount less than the apportionment for that unincorporated area.
The county board of supervisors concurs in that finding.
An equal amount from the apportionment for the unincorporated area served by the San Diego Metropolitan Transit Development Board has been claimed for transit capital projects that are mutually agreed upon by the county and San Diego Metropolitan Transit Development Board.
A claim for a transit capital project pursuant to subdivision (c) may be made by the county or the San Diego Metropolitan Transit Development Board, or jointly, as specified by mutual agreement.
There shall be allocated to the county and the transportation planning agency such sums as are necessary to administer this chapter.
Except as provided in subdivisions (b) and (c), there shall be allocated to the transportation planning agency, if it is statutorily created, such sums as it may approve, up to 3 percent of annual revenues, for the conduct of the transportation planning and programming process, unless a greater amount is approved by the director.
In those areas that have a county transportation commission created pursuant to Section 130050, up to 1 percent of annual revenues shall be allocated to the commission in Los Angeles County, and up to 3 percent of the annual revenues shall be allocated to the commissions in Orange, Riverside, and San Bernardino Counties for the transportation planning and programming process. Of the funds allocated to the commission in Riverside County, one-half shall be allocated for planning studies within the Western Riverside County and the Coachella Valley areas, as determined by the commission.
In the area of the multicounty designated transportation planning agency, as defined in Section 130004, up to three-fourths of 1 percent of annual revenues shall be allocated by the appropriate entities, proportionately, on or before each July 1, to the multicounty designated transportation planning agency for the transportation planning and programming process. No operator shall grant any funds it receives under this chapter to the designated multicounty transportation planning agency for purposes of the agency carrying out its responsibilities under Division 12 (commencing with Section 130000).
In Ventura County, up to 2 percent of the annual revenues shall be allocated to the Ventura County Transportation Commission for the transportation planning and programming process.
This section shall become operative on July 1, 2011.
Two percent of the remaining money in the fund shall be made available to counties and cities for facilities provided for the exclusive use of pedestrians and bicycles unless the transportation planning agency finds that the money could be used to better advantage for the purposes stated in Article 4 (commencing with Section 99260) and Article 4.5 (commencing with Section 99275), or for local street and road purposes in those areas where the money may be expended for those purposes, in the development of a balanced transportation system. Of the amount made available to a city or county pursuant to this section, 5 percent thereof may be expended to supplement moneys from other sources to fund bicycle and pedestrian safety education programs, but shall not be used to fully fund the salary of any one person.
Up to 10 percent of the remaining money for the area under the jurisdiction of a transit development board created pursuant to Division 11 (commencing with Section 120000) shall be allocated to the transit development board and the transportation planning agency to carry out administrative and planning powers, duties, and functions and construction and acquisition programs in accordance with Article 4 (commencing with Section 132353) of Chapter 3 of Division 12.7.
Thereafter, the remaining money for allocation in that area shall be allocated by the transportation planning agency to claimants.
Up to 5 percent of the remaining money in the fund shall be made available to cities, counties, and operators for claims filed pursuant to Article 4. 5 (commencing with Section 99275) in those areas where claims may not be filed for those purposes specified in Article 8 (commencing with Section 99400), and may be made available to consolidated transportation service agencies, unless the transportation planning agency, or a county transportation commission created pursuant to Division 12 (commencing with Section 130000), having jurisdiction finds, after considering the claims pursuant to subdivision (c) of Section 99275.5, that the allocations of money could be used to better advantage for the purposes stated in Article 4 (commencing with Section 99260) in the development of a balanced transportation system.
The money may be allocated without respect to Section 99231 and shall not be included in determining the apportionment to a city or county for purposes of Sections 99233.8 and 99233.9.
There shall be allocated to operators such money as is approved by the transportation planning agency for claims presented pursuant to Article 4 (commencing with Section 99260) of this chapter.
There shall be allocated to counties and cities such money as is approved by the transportation planning agency for claims presented pursuant to Article 8 (commencing with Section 99400) of this chapter.
Funds made available to the County of Stanislaus and the cities in that county shall be allocated in the following order:
To the Stanislaus Area Association of Governments, the County of Stanislaus, and the cities in that county, an amount deemed necessary for the administration of this chapter.
To the Stanislaus Area Association of Governments, an amount approved by that association, but not more than 3 percent of annual revenues, to conduct the transportation planning and programming process, unless a greater amount is approved by the director.
To pedestrian and bicycle facilities, not more than 2 percent of the funds remaining, in accordance with Section 99233.3.
To the Stanislaus Area Association of Governments, an amount deemed necessary for intracity, intercity, and interregional transit services and rail passenger services, when a claim is filed under Section 99234.9, Article 4 (commencing with Section 99260), or Article 8 (commencing with Section 99400), consistent with the cost-sharing criteria approved by the association. Apportionments and allocations from those funds made by the association to the county and the cities in the county also shall be in accordance with the cost-sharing criteria approved by the association.
Notwithstanding anything in Sections 99233 to 99233.9, inclusive, to the contrary, the Solano Transportation Authority may file a claim, and the transportation planning agency may allocate, for the area representing the cumulative areas of the authority’s member agencies, up to 2.7 percent of annual revenues for countywide transit planning and coordination purposes relative to Solano County. Funds allocated to the authority pursuant to this section shall be allocated after allocations are made pursuant to Sections 99233.1 and 99233.2 but prior to other allocations.
Claims for facilities provided for the exclusive use of pedestrians and bicycles or for bicycle and pedestrian safety education programs shall be filed according to the rules and regulations adopted by the transportation planning agency.
The money shall be allocated for the construction, including related engineering expenses, of those facilities pursuant to procedures or criteria established by the transportation planning agency for the area within its jurisdiction, or for bicycle and pedestrian safety education programs.
The money may be allocated for the maintenance of bicycling trails that are closed to motorized traffic pursuant to procedures or criteria established by the transportation planning agency for the area within its jurisdiction.
Facilities provided for the use of bicycles may include projects that serve the needs of commuting bicyclists, including, but not limited to, new trails serving major transportation corridors, secure bicycle parking at employment centers, park and ride lots, and transit terminals where other funds are unavailable.
Notwithstanding any other provision of this section, a planning agency established in Title 7.1 (commencing with Section 66500) of the Government Code may allocate the money to the Association of Bay Area Governments for activities required by Chapter 11 (commencing with Section 5850) of Division 5 of the Public Resources Code.
Notwithstanding any other provision of this section, the transportation planning agencies that allocate funds, pursuant to this section, to the cities and counties with jurisdiction or a sphere of influence within the delta, as defined in Section 5852 of the Public Resources Code, may allocate the money to the Delta Protection Commission for activities required by Chapter 12 (commencing with Section 5852) of Division 5 of the Public Resources Code.
Within 30 days after receiving a request for a review from any city or county, the transportation planning agency shall review its allocations made pursuant to Section 99233.3.
In addition to the purposes authorized in this section, a portion of the amount available to a city or county pursuant to Section 99233.3 may be allocated to develop a comprehensive bicycle and pedestrian facilities plan, with an emphasis on bicycle projects intended to accommodate bicycle commuters rather than recreational bicycle users. An allocation under this subdivision may not be made more than once every five years.
Up to 20 percent of the amount available each year to a city or county pursuant to Section 99233.3 may be allocated to restripe class II bicycle lanes.
Notwithstanding any other provision of this article or Article 4 (commencing with Section 99260), the Orange County Transportation Commission may allocate funds from either the Orange County Unified Transportation Trust, as defined in Section 99301.6, or from the principal upon which the interest is accruing to the Department of Transportation for construction of high-occupancy vehicle lanes within freeways in the county. In the event high-occupancy vehicle lanes constructed with the funds are subsequently converted to mixed flow use, the local transportation fund shall be reimbursed through the State Transportation Improvement Program process the amount of funds provided to the department for construction of the lanes pursuant to this section.
The Counties of San Bernardino, Riverside, and Los Angeles may enter into a joint powers agreement pursuant to Article 1 (commencing with Section 6500), Chapter 5, Division 7, Title 1 of the Government Code, and the joint powers entity created pursuant to such agreement shall in accordance with Section 403 of the Rail Passenger Service Act of 1970 (45 U.S.C. 563), request the National Railroad Passenger Corporation to institute up to two additional trains a day in each direction between Los Angeles and San Bernardino to supplement the present level of service. The joint powers entity may request institution of more than two additional trains a day in each direction between Los Angeles and San Bernardino. Contributions shall be made from the fund of each of the three counties, as agreed by them, to the joint powers entity, as may be required by the National Railroad Passenger Corporation to meet a reasonable portion of any losses associated with such service. The joint powers entity may request that the additional trains shall be operated, to the extent practicable, during periods of peak traffic.
If the funds available under this chapter are insufficient for purposes of subdivision (a), the board of supervisors of any one of the three counties may make contributions to the joint powers entity from any funds available to it.
The Department of Transportation may negotiate and contract with the appropriate railroad corporation to provide passenger rail service between the City and County of San Francisco and the Counties of San Mateo and Santa Clara. In the process of negotiating the contract, the department shall take into consideration the funding available and the level of service as it has been recommended by the Metropolitan Transportation Commission. Notwithstanding Section 14035 of the Government Code, the contract shall not extend beyond June 30, 1993. The California Transportation Commission shall allocate no funds pursuant to Section 14031.6 of the Government Code for this rail passenger service after the 1992–93 fiscal year. If the department enters into a contract, it shall, on or before July 1, 1992, assign the contract to the Peninsula Corridor Study Joint Powers Board or to another local or regional agency designated by the board which is authorized to operate or contract for the operation of rail passenger service, if the board or designated agency determines that the rail passenger service shall be continued. The department shall assign its operating subsidies for the 1992–93 fiscal year for that service to the board or that designated agency. Within the area of jurisdiction of the board, the board or that designated agency may acquire from the department all property owned or leased by the department for that rail passenger service, including, but not limited to, stations, facilities, equipment, and rights-of-way, and this transfer shall be consistent with the process defined in Section 160006. The California Transportation Commission shall not allocate state funds to purchase the San Francisco Peninsula commuter rail service right-of-way unless a local agency assumes operation and control of the commuter rail service on or before June 30, 1993. This section does not prohibit the commission from making a multiyear funding commitment to purchase the right-of-way subject to that assumption of operation and control occurring on or before that date.
Notwithstanding subdivision (a), a transit district or county may negotiate and contract with the appropriate railroad corporation to provide passenger rail service which is to be primarily operated within its jurisdiction. Adjacent transit districts or counties may jointly negotiate and contract with the appropriate railroad corporation to provide passenger rail service which is to be primarily operated within their jurisdictions.
Any county, city, county transportation commission, or operator may file claims with the transportation planning agency for rail passenger service operation expenditures and capital improvement expenditures, including construction and maintenance of intermodal transportation facilities. These funds may be used as the entity’s required contribution toward the cost of providing these services or capital improvements.
Upon having determined the allocation of each claimant on the fund, the transportation planning agency shall convey such information to each claimant and the county auditor, together with one allocation instruction for each claimant advising the auditor as to the time and the nature of payment.
Such instruction may call for a single payment, for payment as moneys become available, or for payment by installments monthly, quarterly, or otherwise. The allocation and instruction may be rescinded and revised by the transportation planning agency only under one of the following circumstances:
An appeal has been filed.
The claimant is found to be spending, or unless enjoined to be about to spend, moneys otherwise than in accordance with the terms of the allocation.
An adjustment is proved to be necessary to reconcile the estimates on which the allocation was based with the actual figures when these are available.
The financial needs of the claimant differ from those at the time of the allocation due to changed circumstances.
No funds from the fund shall be budgeted, allocated, or expended for any project which calls for any change in passenger train stations or loading platforms used by the National Railroad Passenger Corporation, unless the change has been submitted to the National Railroad Passenger Corporation for review and comment which may include a recommendation for a modification in the change. If the agency submitting the change elects not to accept the recommendation of the National Railroad Passenger Corporation, it shall submit the matter to the director who shall determine whether the disputed recommendation for a modification in the change shall be followed by the agency.
Each transportation planning agency shall provide for the establishment of a social services transportation advisory council for each county, or counties operating under a joint powers agreement, which is not subject to the apportionment restriction established in Section 99232.
The social services transportation advisory council shall consist of the following members:
One representative of potential transit users who is 60 years of age or older.
One representative of potential transit users who is disabled.
Two representatives of the local social service providers for seniors, including one representative of a social service transportation provider, if one exists.
Two representatives of local social service providers for the disabled, including one representative of a social service transportation provider, if one exists.
One representative of a local social service provider for persons of limited means.
Two representatives from the local consolidated transportation service agency, designated pursuant to subdivision (a) of Section 15975 of the Government Code, if one exists, including one representative from an operator, if one exists.
The transportation planning agency may appoint additional members in accordance with the procedure prescribed in subdivision (b).
Members of the social services transportation advisory council shall be appointed by the transportation planning agency which shall recruit candidates for appointment from a broad representation of social service and transit providers representing the elderly, the disabled, and persons of limited means. In appointing council members, the transportation planning agency shall strive to attain geographic and minority representation among council members. Of the initial appointments to the council, one-third of them shall be for a one-year term, one-third shall be for a two-year term, and one-third shall be for a three-year term. Subsequent to the initial appointment, the term of appointment shall be for three years, which may be renewed for an additional three-year term. The transportation planning agency may, at its discretion, delegate its responsibilities for appointment pursuant to this subdivision to the board of supervisors.
The social services transportation advisory council shall have the following responsibilities:
Annually participate in the identification of transit needs in the jurisdiction, including unmet transit needs that may exist within the jurisdiction of the council and that may be reasonable to meet by establishing or contracting for new public transportation or specialized transportation services or by expanding existing services.
Annually review and recommend action by the transportation planning agency for the area within the jurisdiction of the council which finds, by resolution, that (A) there are no unmet transit needs, (B) there are no unmet transit needs that are reasonable to meet, or (C) there are unmet transit needs, including needs that are reasonable to meet.
Advise the transportation planning agency on any other major transit issues, including the coordination and consolidation of specialized transportation services.
It is the intent of the Legislature that duplicative advisory councils shall not be established where transit advisory councils currently exist and that those existing advisory councils shall, instead, become part of the social services transportation advisory council and shall assume any new responsibilities pursuant to this section.
The transportation planning agency shall ensure the establishment and implementation of a citizen participation process appropriate for each county, or counties if operating under a joint powers agreement, utilizing the social services transportation advisory council as a mechanism to solicit the input of transit dependent and transit disadvantaged persons, including the elderly, disabled, and persons of limited means. The process shall include provisions for at least one public hearing in the jurisdiction represented by the social services transportation advisory council. Hearings shall be scheduled to ensure broad community participation and, if possible, the location of the hearings shall be rotated among the various communities within the advisory council’s jurisdiction. Notice of the hearing, including the date, place, and specific purpose of the hearing shall be given at least 30 days in advance through publication in a newspaper of general circulation. The transportation planning agency shall also send written notification to those persons and organizations which have indicated, through its citizen participation or any other source of information, an interest in the subject of the hearing.
In addition to public hearings, the transportation planning agency shall consider other methods of obtaining public feedback on public transportation needs. Those methods may include, but are not limited to, teleconferencing, questionnaires, telecanvassing, and electronic mail.
Except for allocations made for purposes of Section 99234 and subdivision (a) of Section 99400, which shall be subject to the rules and regulations adopted by the transportation planning agency, all matters necessary and convenient to the implementation of this chapter shall be subject to rules and regulations, consistent with statute, adopted by the department, with the advice and consent of the commission, and those rules and regulations may be revised from time to time.
The rules and regulations shall specify the procedures by which evaluation and review by the transportation planning agency of public transportation claims shall be accomplished, and shall require submission of corresponding budgets or financial plans, certified financial statements, and other information required in connection therewith. The rules and regulations shall provide for the orderly and periodic distribution of moneys in the fund so that the areas served by the operator will be provided public transportation services on a continuing basis and so that there will be an orderly improvement and maintenance of the system of the operator. The rules and regulations shall provide for the approval of sufficient moneys from the fund to accomplish the intent of the Legislature as expressed in the findings and declarations in Section 99220.
The rules and regulations may require that the transportation planning agency, in reviewing claims, give due consideration to the level of the operator’s passenger fares and charges, the efficiency of the operator’s operations and operating policies and practices, the extent to which the operator is meeting the transportation needs of the area served, and the extent to which the operator is making full use of other available revenues and funds, including federal transportation grants.
The Controller shall annually review the rules and regulations adopted by the department with respect to reporting and auditing procedures and shall make written recommendations for revisions to the department. After consultation with the Controller, the director shall undertake to amend the rules and regulations in accordance with the recommendations.
Rules and regulations adopted by the department with respect to reporting and auditing procedures shall apply to all expenditures of funds allocated pursuant to this chapter.
This section shall become operative on July 1, 1987.
All rules and regulations adopted by the Secretary of the Business, Transportation and Housing Agency pursuant to Section 99241, as it read prior to its amendment by the act adding this section, and in effect on January 1, 1985, shall remain in effect and shall be fully enforceable unless and until amended or repealed by the department.
In the event that a claimant is not satisfied with his approved claim or other action taken by the transportation planning agency, a notification with supporting documentation may be filed with the secretary, who shall conduct an investigation and evaluation of the disagreement between the claimant and the transportation planning agency. The secretary shall notify the involved parties of his findings, which shall be a final settlement of the issue.
The Controller, in cooperation with the department and the operators, shall design and adopt a uniform system of accounts and records, from which the operators shall prepare and submit annual reports of their operation to transportation planning agencies, county transportation commissions, or the San Diego Metropolitan Transit Development Board having jurisdiction over them and to the Controller within seven months after the end of the fiscal year. The report shall contain underlying data from audited financial statements prepared in accordance with generally accepted accounting principles, if this data is available. The report shall specify (1) the amount of revenue generated from each source and its application for the prior fiscal year, and (2) the data necessary to determine which section, with respect to Sections 99268.1, 99268.2, 99268.3, 99268.4, 99268.5, and 99268.9, the operator is required to be in compliance in order to be eligible for funds under this article.
For the purposes of the State Transit Assistance Program, which is governed by Sections 99312 to 99314.9, inclusive, the Controller shall provide a mechanism for each transportation planning agency, county transportation commission, and the San Diego Metropolitan Transit Development Board to report to the Controller those operators within its jurisdiction that are STA-eligible operators, as defined in paragraph (2) of subdivision (b) of Section 99312.2.
The mechanism shall require each transportation planning agency, county transportation commission, and the San Diego Metropolitan Transit Development Board to report to the Controller those STA-eligible operators within its jurisdiction that are both:
A public transportation operator, as defined in paragraph (1) of subdivision (b) of Section 99312.2.
The Controller shall rely upon that verification to determine whether or not an operator is an STA-eligible operator pursuant to paragraph (2) of subdivision (b) of Section 99312.2. The transportation planning agency, county transportation commission, and the San Diego Metropolitan Transit Development Board shall provide this information to the Controller within seven months after the end of each fiscal year.
As a supplement to the annual report prepared pursuant to subdivision (a), each operator shall include an estimate of the amount of revenues to be generated from each source and its proposed application for the next fiscal year, and a report on the extent to which it has contracted with the California Correctional Training and Rehabilitation Authority, including the nature and dollar amounts of all contracts entered into during the reporting period and proposed for the next reporting period.
The Controller shall instruct the county auditor to withhold payments from the fund to an operator that has not submitted its annual report to the Controller within the time specified by subdivision (a).
In establishing the uniform system of accounts and records, the Controller shall include the data required by the United States Department of Transportation and the department.
Notwithstanding any other law or any regulation, including any California Code of Regulations provision, the City of El Segundo, the City of Huntington Beach, the City of Inglewood, the City of Long Beach, or the City of South Lake Tahoe may select, for purposes of this chapter, on a one-time basis, a fiscal year that does not end on June 30. After the city has sent a written notice to the Secretary of Transportation and the Controller that the city has selected a fiscal year other than one ending on June 30, the fiscal year selected by the city shall be its fiscal year for all reports required by the state under this chapter.
On the basis of data in the annual reports submitted pursuant to Section 99243 and the information submitted pursuant to Section 99406 to the Controller, the Controller shall compile, publish, and make publicly available on the Controller’s internet website the submitted data and information on or before November 1 of each year.
The Controller shall take steps as the Controller deems necessary to ensure that the data and information submitted are adequate and accurate.
Each transportation planning agency shall annually identify, analyze, and recommend potential productivity improvements that could lower the operating costs of those operators who operate at least 50 percent of their vehicle service miles, as defined in subdivision (i) of Section 99247, within the area under its jurisdiction. However, where a transit development board created pursuant to Division 11 (commencing with Section 120000) or a county transportation commission exists, the board or commission, as the case may be, shall have the responsibility of the transportation planning agency with respect to potential productivity improvements. The recommendations for improvements and productivity shall include, but not be limited to, those recommendations related to productivity made in the performance audit conducted pursuant to Section 99246.
A committee for the purpose of providing advice on productivity improvements may be formed by the responsible entity. The membership of this committee shall consist of representatives from the management of the operators, organizations of employees of the operators, and users of the transportation services of the operators located within the area under the jurisdiction of the responsible entity.
Before determining the allocation to an operator for the next fiscal year, the responsible entity shall review and evaluate the efforts made by the operator to implement the recommended improvements.
If the responsible entity determines that the operator has not made a reasonable effort to implement the recommended improvements, the responsible entity shall not approve the allocation to the operator for the support of its public transportation system for the next fiscal year that exceeds the allocation to the operator for those purposes for the current fiscal year.
For the 2020–21 to 2022–23, inclusive, fiscal years, each transportation planning agency, transportation development board, and county transportation commission, is exempt from the requirements described in subdivision (a).
Each transportation planning agency, transit development board created pursuant to Division 11 (commencing with Section 120000), and county transportation commission shall be responsible to ensure that all claimants to whom it directs the allocation of funds pursuant to this chapter shall submit to it an annual certified fiscal audit conducted by an entity other than the claimant.
A report on the audit shall be submitted to the transportation planning agency, transit development board, county transportation commission, and to the Controller within 180 days after the end of the fiscal year. However, the responsible entity may grant an extension of up to 90 days as it deems necessary. The report shall include a certification that the funds allocated to the claimant pursuant to this chapter were expended in conformance with applicable laws and rules and regulations. Except for the first report, the report shall also include the audited amounts for the fiscal year prior to the fiscal year audited.
A transit district or other provider of public transportation services subject to an audit pursuant to Section 99245, that receives funds from other sources which also require a fiscal audit, may expand the scope of its audit performed pursuant to Section 99245 to include the conditions and purposes of those other funds.
A transportation planning agency, transit development board, county transportation commission, air quality management district, air pollution control district, or local transportation authority shall not require any additional fiscal audit of an entity if that entity has completed an expanded audit pursuant to subdivision (a) that encompasses the scope, time period, and funding condition of the agency providing funding.
The transportation planning agency shall designate entities other than itself, a county transportation commission, a transit development board, or an operator to make a performance audit of its activities and the activities of each operator to whom it allocates funds. The transportation planning agency shall consult with the entity to be audited prior to designating the entity to make the performance audit.
Where a transit development board created pursuant to Division 11 (commencing with Section 120000) or a county transportation commission exists, the board or commission, as the case may be, shall designate entities other than itself, a transportation planning agency, or an operator to make a performance audit of its activities and those of operators located in the area under its jurisdiction to whom it directs the allocation of funds. The board or commission shall consult with the entity to be audited prior to designating the entity to make the performance audit.
The performance audit shall evaluate the efficiency, effectiveness, and economy of the operation of the entity being audited and shall be conducted in accordance with the efficiency, economy, and program results portions of the Comptroller General’s “Standards for Audit of Governmental Organizations, Programs, Activities, and Functions.” Performance audits shall be conducted triennially pursuant to a schedule established by the transportation planning agency, transit development board, or county transportation commission having jurisdiction over the operator.
The performance audit of the transportation planning agency, county transportation commission, or transit development board shall be submitted to the director. The transportation planning agency, county transportation commission, or transit development board, as the case may be, shall certify in writing to the director that the performance audit of operators located in the area under its jurisdiction has been completed.
With respect to an operator providing public transportation services, the performance audit shall include, but not be limited to, a verification of the operator’s operating cost per passenger, operating cost per vehicle service hour, passengers per vehicle service hour, passengers per vehicle service mile, and vehicle service hours per employee, as defined in Section 99247. The performance audit shall include, but not be limited to, consideration of the needs and types of the passengers being served and the employment of part-time drivers and the contracting with common carriers of persons operating under a franchise or license to provide services during peak hours, as defined in subdivision (a) of Section 99260.2.
The performance audit may include performance evaluations both for the entire system and for the system excluding special, new, or expanded services instituted to test public transportation service growth potential.
The performance audit prepared pursuant to this section shall be made available to the public pursuant to the provisions of the California Public Records Act (Division 10 (commencing with Section 7920.000) of Title 1 of the Government Code).
For purposes of Section 99246, and as used elsewhere in this article:
“Operating cost” means all costs in the operating expense object classes exclusive of the costs in the depreciation and amortization expense object class of the uniform system of accounts and records adopted by the Controller pursuant to Section 99243. “Operating cost” excludes all subsidies for commuter rail services operated on railroad lines under the jurisdiction of the Federal Railroad Administration, all direct costs for providing charter services, all vehicle lease costs, and principal and interest payments on capital projects funded with certificates of participation.
“Operating cost per passenger” means the operating cost divided by the total passengers.
“Operating cost per vehicle service hour” means the operating cost divided by the vehicle service hours.
“Passengers per vehicle service hour” means the total passengers divided by the vehicle service hours.
“Passengers per vehicle service mile” means the total passengers divided by the vehicle service miles.
“Total passengers” means the number of boarding passengers, whether revenue producing or not, carried by the public transportation system.
“Transit vehicle” means a vehicle, including, but not limited to, one operated on rails or tracks, which is used for public transportation services funded, in whole or in part, under this chapter.
“Vehicle service hours” means the total number of hours that each transit vehicle is in revenue service, including layover time.
“Vehicle service miles” means the total number of miles that each transit vehicle is in revenue service.
“Vehicle service hours per employee” means the vehicle service hours divided by the number of employees employed in connection with the public transportation system, based on the assumption that 2,000 person-hours of work in one year constitute one employee. The count of employees shall also include those individuals employed by the operator which provide services to the agency of the operator responsible for the operation of the public transportation system even though not employed in that agency.
No operator is eligible to receive an allocation under this chapter for any fiscal year until the transmittal of reports of its performance audit to the entity which determines the allocation to the operator and the transportation planning agency for the three-year period ending one year prior to the beginning of the fiscal year of the proposed allocation. The transportation planning agency, county transportation commission, or transit development board, as the case may be, shall make the reports available to interested parties.
In conformance with Section 99246, and prior to September 1 of each fiscal year, the transportation planning agency, county transportation commission, or metropolitan transit development board, as the case may be, shall provide to the director and Controller a schedule of performance audits to be submitted during that fiscal year and a list of all operators or claimants who operated or commenced operations during the prior fiscal year.
The cost of making the performance audits may be deemed an administrative cost of the transportation planning agencies for purposes of Section 99233.1. However, the Legislature encourages the use of funds made available by the federal government to support such purposes.
All charter bus services authorized to be performed by a public transportation system receiving funding under this chapter shall contribute financially to the reduction of deficits incurred in the operation of scheduled route service. In addition, the charter bus service shall not interfere with regularly scheduled service to the public or compete unfairly with private operators where the private operators are willing and able to provide charter bus service.
Except as provided in subdivision (d), charter bus service rates and minimums shall be established that are either of the following:
At least equal to the average of the three lowest current rates charged by private charter bus carriers actually operating charters originating in the same service area of the public transportation system during the prior year.
At least equal to the marginal cost of each charter operated.
All charter bus service rates shall be reviewed and adjusted not less than semiannually to reflect variations in actual and assumed costs, as well as private charter bus carrier rates.
If the operator of a public transportation system determines that there is a public need that cannot otherwise be met, the operator may provide charter bus services to charitable or public service organizations at direct cost, not to exceed ten thousand dollars ($10,000) or a total of 40 charter buses per year, whichever occurs first.
This section does not apply to charter bus services that are incidental to the holding of the 2026 FIFA World Cup in the County of Los Angeles and the greater San Francisco Bay area during the period from June 1, 2026, to July 31, 2026, inclusive, if the public transportation system establishes charter bus rates for those services that are sufficient to pay all marginal costs related to those services, that are at least equal to the average of the lowest rates charged by the three largest private charter party carriers operating similar service within the County of Los Angeles or the greater San Francisco Bay area, as applicable, and that contribute financially to the reduction of deficits incurred by the system in the operation of scheduled route service.
For purposes of this subdivision, “greater San Francisco Bay area” means the region comprised of the City and County of San Francisco and the Counties of Alameda, Contra Costa, Marin, Monterey, Napa, San Benito, San Mateo, Santa Clara, Santa Cruz, Solano, and Sonoma.
At any publicly noticed meeting of the governing body of an operator, a representative of a private transportation service provider may request the operator to perform a cost comparison analysis of public transit service provided by vehicles equipped with rubber tires before the governing body acts on a route restructuring or service addition under consideration. The operator may agree to perform a cost comparison analysis pursuant to this section or alternatively, may so agree on the condition that the private transportation service provider that requested the cost comparison analysis agrees to pay the operator’s actual cost of conducting the analysis. If the operator agrees to perform the cost comparison analysis, the private transportation service provider requesting the cost comparison analysis shall supply any information necessary and relevant to complete the analysis.
Nothing in this section shall be construed to require operators to perform a cost comparison analysis. At its sole discretion, the operator’s governing body may elect not to perform a cost comparison analysis. However, if the governing body determines not to perform a cost comparison analysis, it shall specify the reasons for that determination in a resolution adopted at a publicly noticed meeting.
For purposes of this section, the following terms have the following meanings:
“Cost comparison analysis” means a study of the route restructuring or service addition under consideration by the operator, that compares the cost to the operator of directly providing those services compared to the cost to the operator of procuring those services from private entities. The study shall utilize a full cost allocation method that is consistent with generally accepted cost allocation principles.
“Route restructuring” means a permanent change in routing that decreases or increases the total number of daily transit revenue service miles or hours by 25 percent or more.
“Service addition” means an increase in the total number of daily transit revenue service miles or hours on an existing route by 50 percent or more.
If the governing body performs a cost comparison analysis pursuant to this section, the results of the analysis shall be fully disclosed at a publicly noticed meeting.
This section does not apply to an operator in a county with less than 300,000 population or who operates less than 10 buses.
The operator may adopt appropriate procedures to implement the purposes of this section.
No claim submitted by an operator pursuant to this chapter shall be approved unless it is accompanied by a certification completed within the last 13 months from the Department of the California Highway Patrol indicating that the operator is in compliance with Section 1808.1 of the Vehicle Code. The certification may be issued following a terminal inspection, or a terminal reinspection conducted within 60 days thereafter, by the Department of the California Highway Patrol.
ARTICLE 4. Claims for Funds [99260. - 99273.]
Claims may be filed with the transportation planning agency by operators under this article for the following purposes:
The support of public transportation systems.
Aid to public transportation research and demonstration projects.
Contributions for the construction of grade separation projects specified in Section 99318.3.
Claims may be filed with the transportation planning agency by operators to contract with common carriers of persons operating under a franchise or license to provide transportation services during peak hours.
“Peak hours” means the period of time during a day which have a clearly greater-than-average level of patronage, typically the two periods of time which reflect the influx of home-work and work-home patronage on a transportation system.
Claims may be filed with the transportation planning agency by a transit district to make bulk purchases of passenger tickets for passenger rail services, if it is authorized to make such purchases by its enabling legislation.
Claims may also be filed with the transportation planning agency by a city and county or a transit district under this article for payments to be made to a railroad corporation subject to the jurisdiction of the Public Utilities Commission and engaged in the transportation of persons, as defined in Section 208, for operating losses incurred in such transportation of persons between points within the city and county or the district, as the case may be, and for that portion of the operating losses incurred in such transportation of persons in the city and county or the district, as the case may be, whose origin or destination, or both, are outside the city and county or district.
A city and county or a transit district receiving funds under a claim filed pursuant to subdivision (a) shall use those funds for the purposes specified in that subdivision.
Public agencies authorized to file claims pursuant to Section 99234.9 may file claims under this article.
In order to provide, or to contract to provide, transportation services using vehicles for the exclusive use of elderly or disabled persons, a city or a county, which is contributing funds it is eligible to receive under this article to a joint powers agency of which it is a member to operate a public transportation system, may also file a claim under this article and may also file a claim for funds made available pursuant to Section 99313.
The transportation planning agency may adopt rules and regulations supplemental to, and consistent with, those of the department to further delineate procedures for the submission of claims and stating criteria by which they will be analyzed and evaluated.
The criteria may include a statement of intent to disallow any portion of an operator’s claim which calls for moneys to finance unreasonable or arbitrary increases in executive level salaries based on consideration of executive level salaries in other public agencies and in the public transportation industry, both nationally and within the state.
To the extent necessary to perform its duties under this article, the transportation planning agency has full access to the books, records, and accounts of claimant operators.
The San Diego Metropolitan Transit Development Board shall adopt rules and regulations for its area of jurisdiction.
The transportation planning agency may include in its rules and regulations any rule and regulation of the transit development board.
Claims for public transportation systems may include claims for money for all purposes necessary and convenient to the development and operation of the system, including planning and contributions to the transportation planning process, acquisition of real property, construction of facilities and buildings, purchase and replacement of vehicles (including those usable by disabled persons), and system operation, maintenance, and repair, payment for any of which purposes may take the form of direct expenditures or payment of principal and interest on equipment trust certificates, bonded or other indebtedness, or any amounts in accomplishment of a defeasance of any outstanding revenue bond indenture.
An approved claim may include an amount to pay the principal and interest on bonds of the applicant for a public transportation system.
This section shall not be construed as an authorization to any applicant to pledge revenues received from the county’s local transportation fund, unless approved by the voters of the county under Article 7 (commencing with Section 99320) of this chapter.
An operator shall not be eligible for allocation under this article if it routinely staffs with two or more persons a vehicle for public transportation purposes designed to be operated by one person.
No moneys may be allocated to an operator whose claim includes funds for an increase in operating budget in excess of 15 percent above the preceding year or substantial increase or decrease in scope of operations or capital budget provisions for major new fixed facilities, unless the operator’s claim is accompanied by statements, reports, and such other supporting data as may be reasonably required to substantiate such change.
If an operator ceases operations, any capital acquisitions made by that operator from funds allocated to it pursuant to this article may be transferred to any claimant to provide transportation services under this chapter.
The expenditure of the funds received under this article by an operator may in no year exceed 50 percent of the amount required to meet operating, maintenance, and capital and debt service requirements of the system after deduction therefrom of approved federal grants estimated to be received and funds estimated to be allocated pursuant to Section 99314.5.
Notwithstanding the 50-percent limitation, the amount budgeted for capital requirements in any year or other period up to five years, less the amount of federal and other state funds granted or approved therefor, may be allocated and expended for capital improvements to a grade-separated mass transit system, if construction of such facilities has been found to be not inconsistent with the regional transportation plan of the transportation planning agency. Within such five-year period, the transportation planning agency may order the amount of the allocation in any year to be set aside and accumulated for accomplishment of the particular project.
Commencing with claims for the 1980–81 fiscal year, an operator that was in compliance with Section 99268 during the 1978–79 fiscal year in order to be eligible for funds under this article shall be eligible for such funds in any fiscal year, if it remains in compliance with that section during the fiscal year. The determination of compliance for any fiscal year shall be made in the same manner as the determination was made for the 1978–79 fiscal year, except for the exemption provided under Section 99267.5. An allowance for depreciation shall be made in the same manner as provided in the 1978–79 fiscal year.
For purposes of this section, an operator granted a waiver from the requirements of Section 99268 pursuant to Section 99268.8, as it read on January 1, 1979, shall not be deemed in compliance with that section.
In the case of an operator required to be in compliance with Section 99268 under Section 99268.1, the operator may be allocated additional funds that could not be allocated to it because of those requirements, if it maintains, for the fiscal year, a ratio of fare revenues to operating cost, as defined by subdivision (a) of Section 99247, at least equal to one-fifth if serving an urbanized area or one-tenth if serving a nonurbanized area.
Notwithstanding any other law and except as specified in subdivision (b), Sections 99268, 99268.1, 99268.2, 99268.3, 99268.4, 99268.5, 99268.6, 99268.7, 99268.8, 99268.9, 99268.11, 99268.12, 99268.16, 99268.17, 99268.18, 99268.19, 99269, 99270.1, 99270.2, 99270.5, and 99270.6 do not apply to an operator for a fiscal year in which the operator expended from local funding an amount for transit operations not less than the amount the operator expended from local funding for transit operations during the 2018–19 fiscal year. As used in this subdivision, “local funding” means any nonstate grant funds or other revenues generated by, earned by, or distributed to, an operator.
For purposes of verifying the expenditures described in subdivision (a), the Controller may request fiscal data from the operator or conduct an audit of the operator.
Notwithstanding subdivision (a), if the operator fails to comply with the Controller’s request for fiscal data within 120 days of receiving the request, as determined by the Controller, the sections listed in subdivision (a) apply to the operator.
Notwithstanding subdivision (a), if the Controller, through an audit of the operator, determines that the operator did not meet the requirements of subdivision (a), the sections listed in subdivision (a) apply to the operator.
An operator to which the sections listed in subdivision (a) apply pursuant to paragraph (2) or (3) shall reimburse the state for any funds spent unlawfully.
The Controller shall not require an operator to which the sections listed in subdivision (a) do not apply pursuant to subdivision (a) to report data submitted or collected only for purposes of complying with those sections.
This section shall become inoperative on July 1, 2026, and, as of January 1, 2027, is repealed.
In the case of an operator that is serving an urbanized area, and that was eligible for funds under this article during the 1978–79 fiscal year even though not required to be in compliance with Section 99268 or that commenced operation after that fiscal year, the operator shall be eligible for those funds in any fiscal year, commencing with claims for the 1980–81 fiscal year, if it maintains, for the fiscal year, a ratio of fare revenues to operating cost, as defined by subdivision (a) of Section 99247, at least equal to one-fifth.
In the case of an operator that is serving an urbanized area, and that was in operation during the 1978–79 fiscal year even though not then eligible for funds under this article, but that has since become eligible for those funds, the operator shall be eligible for the funds in any fiscal year, commencing with the 1980–81 fiscal year, if it complies with either of the following:
The requirements of Section 99268.
The requirements of subdivision (a).
In the case of an operator that is serving a nonurbanized area, and that was eligible for funds under this article during the 1978–79 fiscal year even though not required to be in compliance with Section 99268 or that commenced operation after that fiscal year, the operator shall be eligible for those funds in any fiscal year, commencing with claims for the 1980–81 fiscal year, if it maintains, for the fiscal year, a ratio of fare revenues to operating cost, as defined by subdivision (a) of Section 99247, at least equal to one-tenth.
Commencing with claims for the 1980–81 fiscal year, no funds shall be allocated under this article in any fiscal year to an operator providing services using vehicles for the exclusive use of elderly and disabled persons, unless the operator maintains, for the fiscal year, a ratio of fare revenues to operating cost, as defined by subdivision (a) of Section 99247, for those services at least equal to one-tenth or to the ratio it had for those services during the 1978–79 fiscal year, whichever is greater.
Notwithstanding subdivision (a), an operator which provides both exclusive transportation services for elderly and disabled persons and regular scheduled public transportation services may be allocated funds under this article for the exclusive service if the combined services qualify under Section 99268.1, 99268.2, 99268.3, or 99268.4, as the case may be, and the ratio of fare revenues to operating cost for the combined service shall not be less than the ratio required in order to make allocations to the operator for its regular scheduled services.
In a county which had less than 500,000 population as determined by the 1970 federal decennial census and more than 500,000 in population as determined by the 1980 or 1990 federal decennial census, an operator in the county shall maintain a ratio of fare revenues to operating cost, as defined by subdivision (a) of Section 99247, at least equal to one-fifth if serving an urbanized area or one-tenth if serving a nonurbanized area.
If a joint powers entity providing public transportation services was funded at any time under this article and is subsequently dissolved, any succeeding entity providing such services shall not be eligible for funding, unless it conforms to Section 99268.1, 99268.2, 99268.3, 99268.4, 99268.5, or 99268.9, as the case may be, which applied to its predecessor.
Except a city or a county filing a claim pursuant to Section 99260.7, no public agency providing public transportation services, after withdrawing from, or while remaining in, a joint powers entity providing public transportation services, shall be eligible for funding under this article, unless it conforms to Section 99268.1, 99268.2, 99268.3, 99268.4, or 99268.9, as the case may be, that the joint powers entity is required to conform with in order to be eligible for such funding at the time the public agency commences its public transportation services. The public agency is an operator and shall be subject to Section 99268.9.
Any unallocated funds resulting from the limitations of Section 99268 may be used for capital intensive transit-related improvements. Every effort shall be made to obtain federal funds for the purposes of this section. Such improvements shall include, but not be limited to, park-and-ride lots, terminal facilities, bus waiting shelters, exclusive lanes for buses, and the acquisition of vehicles and rolling stock for replacement purposes.
The required ratios of fare revenues to operating cost prescribed by this article shall not apply to an extension of public transportation services until two years after the end of the fiscal year in which the extension of services was put into operation. As used in this section, “extension of public transportation services” includes additions of geographical areas or route miles, or improvements in service frequency or hours of service greater than 25 percent of the route total, or the addition of new days of service, and for transit service claimants also includes the addition of a new type of service, such as van, taxi, or bus.
Within 90 days after the end of the first year of implementation, the operator shall submit to the transportation planning agency, the county transportation commission, or the San Diego Metropolitan Transit Development Board having jurisdiction over it, a report on the extension of public transportation services, including, but not limited to, the area served, the revenues generated, and the cost to provide the extended services.
Except as otherwise provided in subdivision (b), if an operator was allocated funds under this article during a fiscal year in which it did not maintain the required ratio of fare revenues to operating cost, the operator’s eligibility to receive moneys from the local transportation fund and allocations pursuant to Sections 99313.3 and 99314.3 shall be reduced during a subsequent penalty year by the amount of the difference between the required fare revenues and the actual fare revenues for the fiscal year that the required ratio was not maintained. The penalty year shall be the fiscal year that begins one year after the end of the fiscal year during which the required ratio was not maintained.
An operator subject to this subdivision shall demonstrate to the transportation planning agency, the county transportation commission, or the San Diego Metropolitan Transit Development Board how it will achieve the required ratio of fare revenues during any penalty year.
The first fiscal year for which an operator does not maintain the required ratio of fare revenues to operating cost is deemed a grace year, and shall not result in any penalty nor loss of eligibility for funds under this article.
Notwithstanding subdivision (a), a transportation planning agency, county transportation commission, or the San Diego Metropolitan Transit Development Board shall not impose the penalty described in subdivision (a) on an operator that does not maintain the required ratio of fare revenues to operating cost during the 2019–20, 2020–21, 2021–22, 2022–23, 2023–24, 2024–25, 2025–26, or 2026–27 fiscal year.
This subdivision shall become inoperative on January 1, 2028.
The operator sustained two separate work stoppages for 15 days or longer due to labor disputes.
At least one of the work stoppages was not related to a labor dispute with the operator.
Notwithstanding Sections 99268.2 and 99268.3, the transportation planning agency or the county transportation commission may set the required ratio of fare revenue to operating cost at not less than three-twentieths for an operator in a county with a population of 500,000 or less and serving an urbanized area where funds may be allocated under Article 8 (commencing with Section 99400). Prior to setting the required ratio, the transportation planning agency or the county transportation commission shall make findings specifying the reasons for its action.
Notwithstanding subdivision (a) of Section 99247, the costs of providing ridesharing services are excluded from operating costs.
Notwithstanding subdivision (a) of Section 99247, all of the following costs shall be excluded from the definition of “operating cost” for the purposes of calculating any required ratios of fare revenues to operating cost specified in this article:
The operating costs required to provide comparable complementary paratransit service as required by Section 37.121 of Title 49 of the Code of Federal Regulations, pursuant to the federal Americans with Disabilities Act of 1990 (42 U.S.C. Sec. 12101 et seq.), as identified in the operator’s paratransit plan pursuant to Section 37.139 of Title 49 of the Code of Federal Regulations.
Cost increases beyond the change in the Consumer Price Index for all of the following:
Fuel.
Alternative fuel programs.
Power, including electricity.
Insurance premiums and payments in settlement of claims arising out of the operator’s liability.
State and federal mandates.
Startup costs for new services for a period of not more than two years.
Costs required to operate demand-response and microtransit services that expand access to transit service beyond fixed route corridors. For purposes of this paragraph, “microtransit” has the same meaning as in Section 99314.6.
Costs of funding or improving payment and ticketing systems and services.
Costs of security services and public safety contracts.
Any expense greater than the actuarially determined contribution associated with pensions and other post-employment benefits as required by Governmental Accounting Board Statement Numbers 68 and 75.
Costs of planning for improvements in transit operations, integration with other operators and agencies, transitioning to zero-emission operations, and for compliance with state and federal mandates.
The exclusion of costs from the definition of operating costs in subdivision (a) applies solely for the purpose of this article and does not authorize an operator to report an operating cost other than as defined in subdivision (a) of Section 99247 or a ratio of fare revenue to operating cost other than as that ratio is described elsewhere in this article, to any of the following entities:
The Controller pursuant to Section 99243.
The entity conducting the fiscal audit pursuant to Section 99245.
The entity conducting the performance audit pursuant to Section 99246.
If fare revenues are insufficient to meet the applicable ratio of fare revenues to operating cost required by this article, an operator may satisfy that requirement by supplementing its fare revenues with local funds and calculating all free and reduced transit fares at their current full retail value. As used in this section, “local funds” means any nonstate grant funds or other revenues generated by, earned by, or distributed to an operator.
Notwithstanding any other provision of this article, all operators providing service within the area under the jurisdiction of the San Diego Metropolitan Transit Development Board and filing claims pursuant to Section 99260 shall be considered a single operator. In order for all those operators to be eligible for funds under this article, an areawide ratio of fare revenues to operating cost, as defined by subdivision (a) of Section 99247, shall be determined on the basis of the total operating cost and total fare revenues of all the operators, which ratio shall not be less than the areawide ratio for the 1978–79 fiscal year.
During the period of the first two years of operation, a new operator subject to this section shall claim each year no more than 75 percent of its total operating cost for that year.
On or after the first day of any fiscal year, an operator may engage in temporary borrowing pursuant to Article 7.6 (commencing with Section 53850), Chapter 4, Part 1, Division 2, Title 5 of the Government Code and for such purposes “revenues” as defined in Sections 53856 and 53858 of that code may include the amount of any claim permitted under this article if a claim has been filed and approved. The amount of any claim for the purposes of this section shall be subject to the limitations on claims specified in this chapter; provided that the calculations of the limitations referred to herein may be based upon estimates of the operator.
The payments made for temporary borrowing authorized under this section shall not be deemed capital expenditures for purposes of Section 99267.
The power of an operator to levy taxes shall not be a prerequisite to its power to issue notes as general obligations pursuant to Article 7.6.
If an operator serves urbanized and nonurbanized areas in the area of jurisdiction of a transportation planning agency, the transportation planning agency shall adopt rules and regulations to determine what portion of the public transportation services of the operator serves urbanized areas and what portion serves nonurbanized areas to determine its required ratio of fare revenues to operating cost, as defined by subdivision (a) of Section 99247, or its required ratio of the sum of fare revenues and local support to operating cost, or both.
The transportation planning agency shall submit the rules and regulations to the department for approval.
If an operator serves an area that was first designated as an urbanized area in the 1980 or a subsequent federal census, the transportation planning agency or the county transportation commission may grant the operator time, but not more than five years from July 1 of the year following the year of the census, to meet the ratio of fare revenues to operating cost required of an operator serving an urbanized area.
In determining whether there is compliance with Section 99268.1, 99268.2, 99268.3, 99268.4, 99268.5, or 99268.9, as the case may be, by operators serving the area of the San Francisco Bay Area Rapid Transit District, excluding the City and County of San Francisco, the Metropolitan Transportation Commission may make that determination for all or some of the operators as a group, if the Metropolitan Transportation Commission finds that the public transportation services of the operators grouped are coordinated.
In determining whether there is compliance with Section 99268.1, 99268.2, 99268.3, 99268.4, 99268.5, or 99268.9, as the case may be, by operators serving the area of Sacramento County and the cities within the county, the Sacramento Area Council of Governments may make that determination for all or some of the operators as a group, if the Sacramento Area Council of Governments finds that the public transportation services of the operators grouped are coordinated. Notwithstanding any other provision of this article, the fare recovery ratio for the Sacramento Regional Transit District shall be no less than 23 percent.
An operator shall be eligible for allocations under this article, on and after July 1, 1976, only if the current cost of its retirement system is fully funded with respect to the officers and employees of its public transportation system, or if the operator is implementing a plan approved by the transportation planning agency which will fully fund the retirement system for such officers and employees within 40 years.
“Fully funded” with respect to the retirement system, means that the system, at any particular time, has assets determined to be sufficient to provide for the payment of all pension and other benefits to such officers and employees then entitled, or who may become entitled, under terms of the system to an immediate or deferred benefit in respect to service rendered by such officers and employees.
An operator that has a private pension plan shall be eligible for allocations under this article, on and after July 1, 1976, only if the operator does both of the following:
Conducts periodic actuarial studies of its employee pension plans to determine the annual cost of future pension benefits.
Sets aside and invests, on a current basis, funds sufficient to provide for the payment of future pension benefits.
An operator that has a private pension plan shall be eligible for allocations under this article, on and after July 1, 1976, only if the operator reports in its financial statements, at least annually, all of the following:
The actuarially determined amount of pension liability.
The amount of cash funds set aside and invested to meet the pension liability.
The amount of any deficit in the pension fund.
The financial plan adopted to eliminate the deficit in the pension fund.
ARTICLE 4.5. Claims for Community Transit Services [99275. - 99277.]
Claims may be filed with the transportation planning agency by claimants for community transit services, including such services for those, such as the disabled, who cannot use conventional transit services.
For purposes of this article, “community transit services” means transportation services which link intracommunity origins and destinations.
Claims, for purposes of this article, shall be filed in the same manner as claims are filed for purposes of Article 4 (commencing with Section 99260).
The transportation planning agencies shall adopt criteria, rules, and regulations for the evaluation of claims filed under this article and the determination of the cost effectiveness of the proposed community transit services to be provided under the claims.
Prior to approving a claim filed under this article, the transportation planning agency shall make all of the following findings:
That the proposed community transit service is responding to a transportation need currently not being met in the community of the claimant.
That the service shall be integrated with existing transit services, if appropriate.
That the claimant has prepared an estimate of revenues, operating costs, and patronage.
That the claimant is in compliance with Section 99268.3, 99268.4, 99268.5, or 99268.9, whichever is applicable to it, or with regional, countywide, or county subarea performance criteria, local match requirements, or fare recovery ratios adopted by resolution of the transportation planning agency or the county transportation commission for any or all types of community transit services.
If a transportation planning agency or county transportation commission has adopted performance criteria, local match requirements, or fare recovery ratios, the rules and regulations of the agency or commission apply, and Sections 99205.7 and 99241, subdivision (a) of Section 99247, and Section 99268.8 do not apply.
A transportation planning agency or county transportation commission shall allocate no funds to a claimant not in compliance with Sections 99155 and 99155. 5.
Each claimant receiving funds allocated for purposes of this article shall submit an annual certified fiscal audit pursuant to Section 99245.
Claimants may contract on the basis of competitive bidding to provide community transit services.
ARTICLE 5. Relationships Between Operators [99280. - 99299.]
An included municipal operator shall not establish a public transportation system either by adding new routes or extending existing routes, by acquisition or otherwise, outside of its boundaries and outside of the reserved service area consisting of the area that would be formed by joining all points that are distant three-quarters of one mile from any point of any of its regularly scheduled routes in existence and in operation on March 1, 1971. No point within such reserved service area shall be more than three-quarters of a mile from a point on one of such regularly scheduled routes, without first providing the governing board of the transit district with a 60-day advance written notice of its intention to add new routes or extend existing routes outside of the reserved service area. Within 30 days of receiving such written notice, the governing body of the transit district shall either (a) notify the included municipal operator that the transit district does not intend to add or extend the routes in question itself, in which case the included municipal operator may proceed with implementation of its plans; or (b) serve immediate notice upon the included municipal operator that the transit district desires to establish the proposed new service itself and is otherwise not precluded from doing so. In the event that the governing body of the transit district elects to provide the service in question, it shall institute such service within 60 days of the time proposed by the included municipal operator for initiation of such service.
The operation by included municipal operators of new or extended routes established pursuant to this section are subject to the condition whereby the transit district may assume operation of such new or extended routes, if it is not otherwise precluded from doing so, after a 60-day notification by the transit district to the included municipal operator. No route so assumed by the transit district may be abandoned by the transit district without first serving a 60-day written notice of intent to abandon on the included municipal operator which previously provided the service. Subsequent to the abandonment by the transit district, the included municipal operator may, at its option, resume service if it is not otherwise precluded from doing so.
Any included municipal operator, as a condition precedent to filing a claim under Article 4 (commencing with Section 99260) of this chapter, shall file with the transportation planning agency a certified route map showing those regularly scheduled routes in existence and in operation on March 1, 1971, outside of its boundaries. Such certified map shall also indicate by an appropriate legend the service area where the consent of the transit district is not required under the terms of this section.
The establishment of new routes, or the extension of existing routes, outside the boundaries of an included municipal operator, but within the reserved service area, as defined in this section, shall not be permitted where the operation or establishment of such routes will compete with or divert patronage from a route of the transit district as of the date the transit district is given the notice hereinafter required. Before any such new routes are established or existing routes are extended, the included municipal operator shall give the transit district an appropriate 60-day notice.
The transit district may operate or establish new routes or extend existing routes in all or part of the area outside a municipal operator, except where the operation or establishment of that service will compete with or divert patronage from an existing service of any included municipal operator or service in a reserved service area under Section 99280. However, this limitation upon the district does not apply with respect to services established outside a reserved service area by an included municipal operator under Section 99280.
Unless both the department and the statutorily created regional transportation planning agency designate otherwise, the transit district has the sole prerogative of using funds available under this chapter for the purpose of constructing and operating a grade-separated mass transit system, regardless of whether the operation of the system competes with or diverts patronage from any services of an included municipal operator.
All operators shall be encouraged to establish maximum coordination of public transportation services, fares, transfer privileges, and all other related matters for the overall improvement of public transportation service to the general public requiring such services within the affected areas.
Where there are two or more operators within its area of jurisdiction, the transportation planning agency, the county transportation commission, and the San Diego Metropolitan Transit Development Board, as the case may be, shall adopt, not later than July 1, 1980, rules and regulations to provide for transfers between the public transportation services of the operators so that such services will be coordinated.
The consent of a transit district to the operation of a public transportation system by an included municipal operator pursuant to Section 99280 may include a requirement for interchange of transfers on an appropriate basis between the public transportation system of the included municipal operator and the public transportation system of the transit district, or any nominee of such transit district, in connection with the furnishing of services by such public transportation systems.
The violation by a transit district or an included municipal operator of any provisions of this article, or of any agreement between them with regard to providing public transportation services, shall disqualify the violator from filing a public transportation claim pursuant to Article 4 (commencing with Section 99260) of this chapter, and the transportation planning agency shall take no further action in connection with the approval of any pending public transportation claim of such violator until it determines that such violation has ceased.
The county transportation commissions created pursuant to Division 12 (commencing with Section 130000), including those agencies in Los Angeles County created by statute that assume the same statutory obligations as county transportation commissions, shall submit to the transportation planning agency those claims to be funded, and the transportation planning agency shall approve only those claims submitted.
Each commission shall adopt appropriate criteria by which claims shall be analyzed and evaluated, and shall approve only those claims which will provide for a coordinated public transportation system consistent with the adopted transportation improvement program and adopted regional transportation plan and which will not result in undesirable duplication of public transportation services.
In considering proposals, the Los Angeles County Metropolitan Transportation Authority shall consider, among other things, the fare revenue to operating cost ratio and the public transit service mileage of each operator in the authority operating area, but under no circumstances shall the included municipal operators in existence and receiving formula allocation program funding on July 1, 1996, receive less than the percentage of state, federal, and local funds allocated in the 1995–96 fiscal year for bus services. An operator designated as an included municipal operator effective July 1, 1996, shall, under no circumstances, receive less than its percentage of state, federal, and local funds for eligible services pursuant to the formula specified in subdivision (d).
Under no circumstances shall included or eligible municipal operators, as defined in Sections 99207 and 99207.5, respectively, in existence on July 1, 1996, and receiving formula-equivalent funding from sources other than federal operating funds pursuant to Section 5307 of Title 49 of the United State Code, and funds claimed under Article 4 (commencing with Section 99260) and Article 6.5 (commencing with Section 99310) of this chapter receive less than the proportional share allocated during the 1995–96 fiscal year from the Proposition A 40 percent fund and other available funding sources.
Commencing with the 1996–97 fiscal year, eligible and included municipal operators and the Los Angeles County Metropolitan Transportation Authority shall continue to be allocated not less than the amount that would be allocated to them under the formula allocation procedure in effect July 1, 1995, and under subdivision (i). Based upon audited transit performance data submitted for bus transit operations covering the most recent year for which audited data is available, each of those operator’s share of the funds available for allocation shall be calculated as follows: 50 percent of the operator’s vehicle service miles, and 50 percent of the operator’s passenger revenues divided by its base cash fare.
A three-fourths vote of the principal members of the Los Angeles County Metropolitan Transportation Authority shall be required to modify the formulas for allocating of funds available for bus service under this section to the authority operator and included and eligible municipal operators, as defined or described in Sections 99207, 99207.5, and 130050.2.
A two-thirds vote of the members shall be required in order to establish or change the criteria for admitting new included municipal operators for eligibility for funds allocated under Article 4 (commencing with Section 99260).
A two-thirds vote of the members shall be required, based on the criteria in effect under paragraph (1), to allocate funds under Article 4 (commencing with Section 99260) to any “included municipal operator,” as defined in subdivision (d) of Section 99207, which has not previously received funds under this article.
The Los Angeles County Metropolitan Transportation Authority shall give equal consideration to the capital projects of all operators in the county, and shall allocate regional federal bus transit capital funds based on the authority’s capital allocation procedure existing on July 1, 1995, exclusive of funds specifically earmarked by federal law for other purposes.
It is the intent of the Legislature that neither this section nor the creation of the Los Angeles County Metropolitan Transportation Authority and its operating organizational unit shall impact the allocation of funds pursuant to Article 8 (commencing with Section 99400) by local agencies currently eligible to receive these funds.
As part of the formula allocation procedure used to distribute from a state transit assistance fund, the Mills-Deddeh Transportation Development Act (Division 11 (commencing with Section 120000) of the Public Utilities Code), Section 5307 of Title 49 of the United States Code, and Proposition A 40 percent funds pursuant to this chapter, and federal operating funds to Los Angeles County operators, eligible and included municipal operators designated on September 25, 1991, or July 1, 1992, who, since that time, have received annual allocations of local sales tax funding in lieu of specified formula funds, shall continue to receive those same formula-equivalent levels of funding from local discretionary sources. Included municipal operators who receive annual allocations of local sales tax funding for specified services or service levels shall continue to receive equivalent levels of funding allocated from local sources for these services in the 1995–96 fiscal year.
Ninety percent of the Proposition C 5 percent security funds shall be allocated to the included and eligible municipal operators and the Los Angeles County Metropolitan Transportation Authority according to their proportionate number of transit passengers served. The funds shall be allocated only to those operators which have filed with the Los Angeles County Metropolitan Transportation Authority a cost-effective program to provide transit security services. Any unallocated funds shall revert to the remaining balance of security funds which shall be disbursed at the discretion of the Los Angeles County Metropolitan Transportation Authority.
This section shall not impact or restrict the use of those portions of Mills-Deddeh Transportation Development Act, Proposition A, or Proposition C local return or other transportation funds allocated to cities or counties by population nor shall this section restrict the level or source of funding programmed by local jurisdiction to operators.
For any fiscal year commencing on and after July 1, 1975, in determining the allocation of any operator pursuant to Section 99285, the public transit service mileage of any operator which has lost any days of operation due to strikes occurring prior to August 1, 1975, civil disorders, or acts of God shall equal its actual public transit service mileage times the number of days it would have been in operation but for such causes, divided by the number of days it was in actual operation.
Notwithstanding any other provision of law, no operator may plan or establish a public transportation system by adding or extending routes, by acquisition or otherwise, into the area of a contiguous transit district, nor may moneys be allocated from the fund of the county where such addition or extension is contemplated for such purposes, without the consent of the affected transit district.
No provision of this article shall preclude the San Francisco Bay Area Rapid Transit District from planning, acquiring, constructing, and operating its system within or without the territory of the district as provided for by Article 5 (commencing with Section 29030), Chapter 6, Part 2 of Division 10. Notwithstanding the provisions of subdivision (d) of Section 99220, in the event an extension is to be made into a county for which services have not been provided, the moneys within the fund of that county may be used to pay the costs of securing such services.
Notwithstanding subdivision (a) or the limitations of Section 99231, during a period of up to five years that the San Francisco Bay Area Rapid Transit District is planning any extension of its system into a county outside of the district but with a coterminous boundary with the district and which contains a major transportation facility belonging to another county or city and county, the Metropolitan Transportation Commission may order that any funds in the local transportation fund of such county that are not necessary to pay approved claims under Article 4 (commencing with Section 99260) of this chapter be retained.
Any city, county, or transit district may enter into a contract with any operator, except with an included municipal operator unless specifically approved by the governing body of the transit district in whose area the included municipal operator is located, for the operator to provide public transportation service in the city, county, or transit district. In that case, the operator providing the service may include the claim of the city, county, or transit district, as the case may be, with its claim. The claim may include an amount for reimbursement of the actual costs incurred by the city, county, or transit district for the administration, review, and monitoring of the contract. The amount so claimed shall not exceed 5 percent of the total amount of the contract for public transportation service in the city, county, or transit district.
With the prior express authorization of the department, a transit district may include in its claim a proportional amount for regularly scheduled services outside its boundaries even though the contract specified in subdivision (a) has not been executed.
Funds received by a city or county designated as an included municipal operator pursuant to subdivision (b) of Section 99207 because it is not receiving adequate local public transportation service from any transit districts in which it is located may only be used by such a city or county to contract with an operator for public transportation services.
If the Metropolitan Transportation Commission determines that it is not feasible on the basis of, among other things, cost to contract with an operator pursuant to subdivision (a), the city or county may use the funds for either or both of the following:
The development and operation of a public transportation system.
Public transportation service received under contract from an operator providing such service since at least July 1, 1972, or from a common carrier, as defined in Section 211, which is under the jurisdiction and control of the Public Utilities Commission and which is engaged in the transportation of persons, as defined in Section 208.
The system or the service under the contract, as the case may be, shall be consistent, as determined by the Metropolitan Transportation Commission, with the regional transportation plan.
The provisions of this article shall control over the provisions of any other act or law applicable to a transit district to the extent of any conflict with such provisions.
ARTICLE 6. Miscellaneous [99301. - 99304.]
Interest earned on funds allocated pursuant to this chapter shall be expended only for those purposes for which the funds were allocated.
Notwithstanding Sections 99232, 99233, and 99301, the Orange County Transportation Commission may direct the transportation planning agency to allocate interest accruing from money retained for the development of transit in the local transportation fund of the County of Orange, to the County of Orange, to cities within the county, to the Department of Transportation, to the Orange County Transit District, and to the Orange County Transportation Commission to expend for transportation purposes within the County of Orange, as determined by the Orange County Transportation Commission, including those which could be funded by motor vehicle fuel taxes pursuant to Section 1 of Article XIX of the California Constitution. The commission, when determining the purposes for which the money is to be expended, shall ensure that, to the extent possible, at least one-half of the money is allocated to local street and road projects.
Interest accruing pursuant to Section 99301.5 shall continue to be allocated under that section for as long as there is a balance of money retained for the development of transit in the local transportation fund of the County of Orange. For this purpose, the amount of the balance retained for the development of transit in the local transportation fund shall be determined by the Orange County Transportation Commission with the concurrence of the Orange County Transit District prior to the beginning of each fiscal year.
After the allocation instructions have been received from the transportation planning agency, the interest accruing shall be deposited in a separate account maintained by the Orange County Treasurer, which shall be known as the Orange County Unified Transportation Trust. Thereafter, the Orange County Transportation Commission shall issue allocation instructions on the balance in the Orange County Unified Transportation Trust.
Notwithstanding the fact that the Metropolitan Transportation Commission is not required to adopt a regional transportation plan until June 30, 1973, for the region comprised of the City and County of San Francisco and the Counties of Alameda, Contra Costa, Marin, Napa, San Mateo, Santa Clara, Solano, and Sonoma, it may approve the claim of any applicant within the region.
The commission shall approve those claims which will not result in the undesirable duplication of public transportation services, and which will provide for a coordinated public transportation system, in the region.
The commission may, on its own motion, arbitrate differences (1) between the various applicants, (2) between an applicant and a city or county regarding the costs of the extension of services, and (3) between the various entities within the region regarding priorities and the order that various improvements are to be made.
Before the Orange County Transit District may expend any of its allocation it has retained for the development of rapid transit for purposes other than such development, the Orange County Transportation Commission shall make a determination that the funds are not required for any exclusive public mass transit guideway purpose within the foreseeable future.
Not less than 75 percent of the unallocated apportionment, as of June 30, 1978, and each June 30th thereafter, for the cities, and that portion of the County of San Diego, under the jurisdiction of the San Diego Metropolitan Transit Development Board shall be available to the board for exclusive public mass transit guideway purposes as specified in Article 4 (commencing with Section 120260) of Chapter 4 of Division 11.
On July 1 of the first fiscal year of implementation of Section 120265, this section shall no longer be effective except as to the prior year’s unallocated apportionment.
Notwithstanding Section 29530 of the Government Code, the Metropolitan Transportation Commission shall, if an unallocated apportionment has been set aside for an operator for specific future expenditures, also set aside annually the interest earned on the unallocated apportionment that has been set aside until the unallocated apportionment is allocated, and shall include the set-aside interest in the amount apportioned to that operator. The interest amount shall be determined by the Metropolitan Transportation Commission based on its estimate of the average rate of interest earned by the unallocated apportionment during the prior fiscal year.
ARTICLE 6.5. Transportation Planning and Development Account [99310. - 99319.]
The Transportation Planning and Development Account in the State Transportation Fund, hereafter referred to as the “account” in this article, is hereby continued in existence as the Public Transportation Account in the fund.
Any reference in any law or regulation to the Transportation Planning and Development Account in the State Transportation Fund is a reference to the Public Transportation Account.
The account is hereby designated a trust fund.
The funds in the account shall be available, when appropriated by the Legislature, only for transportation planning and mass transportation purposes, as specified by the Legislature.
The Legislature may amend this section by statute passed in each house of the Legislature by rollcall vote entered in the journal, two-thirds of the membership concurring, if the statute is consistent with, and furthers the purposes of, this section.
Notwithstanding any other provision of law, upon order of the Department of Finance, all or some of the state agencies collecting revenue for, or spending from, the Public Transportation Account shall adjust budgeting, accounting, and reporting systems and documents so that unliquidated encumbrances, payables, and other accruals are not reflected in the fund balance in the Governor’s Budget fund condition display or the fund balance in the financial statements submitted to the Controller for the budgetary-legal basis annual report.
For the purposes of the Governor’s Budget, the balance of cash advanced from the Public Transportation Account to the Transportation Revolving Account, as jointly determined by the Department of Finance and the state agencies referenced in subdivision (a), shall be deemed as resources and cash available to the Public Transportation Account for budgeting purposes.
This method shall be effective with the 2013–14 Governor’s Budget development process and may be applied to the 2011–12 data.
State transportation planning.
Upon appropriation by the Legislature, the director shall allocate, from the account or from other available state or federal sources, or from both state and federal sources, for the purposes of subdivision (b) of Section 99311, an amount commensurate with the historical annual allocation to transportation planning agencies designated pursuant to Section 29532 of the Government Code that do not directly receive federal planning funds, as set forth in Section 134 of Title 23 of the United States Code.
The amount allocated to a transportation planning agency designated pursuant to Section 29532 of the Government Code, for the preparation or updating of a regional transportation plan pursuant to Chapter 2.5 (commencing with Section 65080) of Title 7 of that code, may be up to 70 percent of its nonfederally reimbursed costs for regional transportation planning.
For a transportation planning agency in a county with a population of less than 500,000 persons, the director may increase that percentage, if the director determines it to be in the best interests of regional and state transportation planning to do so.
Fifty percent for purposes of Section 99315, subject to appropriation by the Legislature.
To the Controller, 25 percent for allocation to transportation planning agencies, county transportation commissions, and the San Diego Metropolitan Transit Development Board pursuant to Section 99314, for the purposes of the State Transit Assistance Program. These funds are hereby continuously appropriated for these purposes.
To the Controller, 25 percent for allocation to transportation planning agencies, county transportation commissions, and the San Diego Metropolitan Transit Development Board pursuant to Section 99313, for the purposes of the State Transit Assistance Program. These funds are hereby continuously appropriated for these purposes.
Fifty percent for allocation to transportation planning agencies, county transportation commissions, and the San Diego Metropolitan Transit Development Board pursuant to Section 99314, for purposes of the State Transit Assistance Program.
Fifty percent for allocation to transportation agencies, county transportation commissions, and the San Diego Metropolitan Transit Development Board pursuant to Section 99313, for purposes of the State Transit Assistance Program.
For purposes of this chapter, the revenues allocated pursuant to this section shall be subject to the same requirements as revenues allocated pursuant to subdivisions (b) and (c), as applicable, of Section 99312.
The revenues transferred to the Public Transportation Account for the State Transit Assistance Program that are attributable to subdivision (a) of Section 11053 of the Revenue and Taxation Code are hereby continuously appropriated to the Controller, and, upon allocation pursuant to Sections 99313 and 99314, shall only be expended on the following:
Transit capital projects or services to maintain or repair a transit operator’s existing transit vehicle fleet or existing transit facilities, including rehabilitation or modernization of existing vehicles or facilities.
The design, acquisition, and construction of new vehicles or facilities that improve existing transit services.
Transit services that complement local efforts for repair and improvement of local transportation infrastructure.
For each fiscal year, each recipient transit agency receiving an apportionment of funds pursuant to subdivision (c) shall, upon expending those funds, submit documentation to the department that includes a description and location of each completed project, the amount of funds expended on the project, the completion date, and the estimated useful life of the improvement.
The audit of transit operator finances required pursuant to Section 99245 shall verify that the revenues identified in subdivision (c) have been expended in conformance with these specific requirements and all other generally applicable requirements.
Notwithstanding any other law, the Controller shall allocate the funds made available in subdivision (c) in the 2020–21 to 2025–26, inclusive, fiscal years pursuant to Sections 99313 and 99314 and, for the funds allocated pursuant to Section 99314, shall allocate those funds in accordance with the individual operator ratios described in Section 99314.10.
Notwithstanding paragraphs (1), (2), and (3) of subdivision (c), a recipient transit agency may expend funds apportioned pursuant to subdivision (c) for the 2019–20 to 2025–26, inclusive, fiscal years on any operating or capital costs to maintain transit service levels if the governing board of the recipient transit agency makes a declaration that the expenditure of those funds is necessary to prevent transit service levels from being reduced or eliminated.
The requirements of subdivisions (d), (e), and (f) do not apply to the receipt or expenditure of funds pursuant to paragraph (1).
The State Transit Assistance Program, also known as the STA program, which provides for allocations of funds made available from the Public Transportation Account pursuant to Sections 99313 and 99314, and which is governed by Sections 99312 to 99314.9, inclusive, is hereby continued in existence. The purpose of the STA program is to provide a source of state funding to eligible public transportation operators and other transportation agencies in order to support their local and regional transit operating and capital needs.
For purposes of the STA program, the following terms shall have the following meanings:
The only entities eligible to receive direct allocations from the Controller under Sections 99313 and 99314 shall be transportation planning agencies, county transportation commissions, and the San Diego Metropolitan Transit Development Board. The Controller shall distribute funds attributable to transportation planning agencies, county transportation commissions, and the San Diego Metropolitan Transit Development Board to the applicable county treasurer’s office. Upon the request of a transportation planning agency, county transportation commission, or the San Diego Metropolitan Transit Development Board, the Controller shall instead distribute the applicable funds directly to the requesting agency.
Only STA-eligible operators shall be eligible to receive STA program funds allocated by transportation planning agencies, county transportation commissions, and the San Diego Metropolitan Transit Development Board pursuant to Section 99314. An STA-eligible operator, at its discretion, may further suballocate funds it receives pursuant to Section 99314 to an entity operating local community transit services that is eligible to claim local transportation funds pursuant to Article 4.5 (commencing with Section 99275) but that is otherwise ineligible to directly receive funds allocated pursuant to Section 99314.
An entity operating community transit services pursuant to Article 4.5 (commencing with Section 99275) may be allocated funds pursuant to Section 99313 as a subrecipient at the discretion of the transportation planning agency, the county transportation commission, or the San Diego Metropolitan Transit Development Board.
The Los Angeles County Metropolitan Transportation Authority, which is both a county transportation commission for purposes of Sections 99313 and 99314, and an STA-eligible operator for purposes of Section 99314, may incorporate into its report pursuant to Section 99243 any operating costs for local community transit service under contract with the authority, including service provided by a consolidated transportation service agency pursuant to Section 99204.5 or by operators eligible to expend local transportation funds only under Article 4.5 (commencing with Section 99275).
Revenues transferred to the Public Transportation Account pursuant to paragraph (2) of subdivision (c) of Section 6051.8 and paragraph (2) of subdivision (c) of Section 6201.8 of the Revenue and Taxation Code are hereby continuously appropriated to the Transportation Agency for distribution in the following manner:
Fifty percent of available annual revenues under this section shall be allocated by the Transportation Agency to the public agencies, including joint powers agencies, responsible for state-supported intercity rail services. A minimum of 25 percent of the funds available under this subdivision shall be allocated to each of the state’s three intercity rail corridors that provide regularly scheduled intercity rail service.
The Transportation Agency shall adopt guidelines governing the administration of the funds available under this subdivision, including provisions providing authority for loans of these funds by mutual agreement between intercity rail service corridors.
Fifty percent of available annual revenues under this section shall be allocated by the Transportation Agency to the public agencies, including joint powers agencies, responsible for commuter rail services. For the 2018–19 and 2019–20 fiscal years, 20 percent of the funds available under this subdivision shall be allocated to each of the state’s five commuter rail service providers that provide regularly scheduled commuter rail service. Commencing July 1, 2020, the funds available under this subdivision shall be allocated based on guidelines and a distribution formula adopted by the Transportation Agency.
On or before July 1, 2019, the Transportation Agency shall prepare a draft of the proposed guidelines and distribution formula and make them available for public comment. In preparing the proposed guidelines and distribution formula, the agency shall consult with the state’s five commuter rail service providers. The final guidelines and distribution formula shall be adopted on or before January 1, 2020. The guidelines shall include, but need not be limited to, provisions providing authority for loans of these funds by mutual agreement between commuter rail service providers and providing for baseline allocations to each provider.
The funds made available by this section may be used for operations and capital improvements.
Revenues transferred to the Public Transportation Account pursuant to subdivision (a) of Section 11053 of the Revenue and Taxation Code for the Transit and Intercity Rail Capital Program (Part 2 (commencing with Section 75220) of Division 44 of the Public Resources Code) shall be available for appropriation to that program pursuant to the annual Budget Act.
In the case of a transportation planning agency with county transportation commissions within its area of jurisdiction, the allocations pursuant to Sections 99313 and 99314 to the transportation planning agency shall be determined by excluding the areas also under the jurisdiction of the county transportation commissions.
In the case of the transportation planning agency with the San Diego Metropolitan Transit Development Board within its area of jurisdiction, the allocations pursuant to Sections 99313 and 99314 to the transportation planning agency shall be determined by excluding the area also under the jurisdiction of the transit development board.
Not later than each January 31st, for purposes of the State Transit Assistance Program, the Controller shall compute, publish, and send to each transportation planning agency and county transportation commission, and the San Diego Metropolitan Transit Development Board an estimate of the amount of funds from subdivisions (b) and (c) of Section 99312 and Section 99312.1 to be allocated to it during the next fiscal year pursuant to Sections 99313 and 99314.
Not later than each August 1st, on the basis of the amounts continuously appropriated pursuant to subdivisions (b) and (c) of Section 99312 and Section 99312.1 for the applicable fiscal year for purposes of Sections 99313 and 99314, the Controller shall compute, publish, and send to each transportation planning agency and county transportation commission, and the San Diego Metropolitan Transit Development Board an estimate of the amount of funds to be allocated to it during the fiscal year. Notwithstanding any other law, for the 2017–18 fiscal year, the Controller shall compute, publish, and send the estimate within 90 days of the enactment of the act amending this section in the 2017–18 Regular Session.
The Controller, along with the actions taken pursuant to subdivisions (a) and (b), with respect to the allocations under Section 99314, shall also compute, publish, and send to each transportation planning agency and county transportation commission, and the San Diego Metropolitan Transit Development Board the share of funds corresponding to each STA-eligible operator within the jurisdiction of each agency, commission, and board.
From the funds made available pursuant to subdivision (c) of Section 99312 and paragraph (2) of subdivision (a) of Section 99312.1, an amount shall be allocated by the Controller to each transportation planning agency and county transportation commission, and the San Diego Metropolitan Transit Development Board based on the ratio of the population of the area under its jurisdiction to the total population of the state. The Controller shall base these allocations on a report prepared by the Department of Transportation. On or before June 30 of each year, the Department of Transportation shall prepare and submit to the Controller a report detailing the population of each transportation planning agency and county transportation commission, and the San Diego Metropolitan Transit Development Board. For the purpose of this report, the Department of Transportation shall use the most recent population estimates of the Department of Finance and the information provided pursuant to subdivision (b).
To assist the Department of Transportation in determining the populations of the San Diego Metropolitan Transit Development Board, the San Diego Association of Governments, the El Dorado County Transportation Commission, the Placer County Transportation Planning Agency, and the Tahoe Regional Planning Agency for the purpose of subdivision (c) of Section 99312 and paragraph (2) of subdivision (a) of Section 99312.1, each of those entities, on or before June 1st of each year, shall provide the department with the population of its respective jurisdiction using the most recent population estimates of the Department of Finance.
A transportation planning agency, a county transportation commission, or the San Diego Metropolitan Transit Development Board may transfer any funds that it receives pursuant to Section 99313 to another transportation planning agency, county transportation commission, or the San Diego Metropolitan Transit Development Board, as applicable. Any funds transferred pursuant to this section shall be used only for the purposes authorized by this chapter and are subject to all statutes and rules and regulations applicable to funds allocated pursuant to Section 99313.
If one transfer has been completed between a transportation planning agency, a county transportation commission, or the San Diego Metropolitan Transit Development Board, pursuant to this section, no other transfer may be made between the same parties.
In the event of a transfer of funds to the Los Angeles County Metropolitan Transportation Authority pursuant to this section, the amount of that transfer, if any, which exceeds the amount of funds transferred at that time by the Los Angeles County Metropolitan Transportation Authority to the transferring transportation planning agency, county transportation commission, or the San Diego Metropolitan Transit Development Board, may not be used for the purpose of funding an exclusive public mass transit guideway system project. The Los Angeles County Metropolitan Transportation Authority shall report to the Senate Committee on Transportation and Housing and the Assembly Committee on Transportation on the expenditure of any funds received by it pursuant to a transfer made pursuant to this section.
The amount received by each transportation planning agency and county transportation commission, and the San Diego Metropolitan Transit Development Board, pursuant to Sections 99313 and 99314, shall be allocated for public transportation purposes. Pursuant to subdivision (d) of Section 99312.2, funds received pursuant to Section 99314 may be allocated only to STA-eligible operators. Funds received pursuant to Section 99314 may be expended by STA-eligible operators for community transit services pursuant to Section 99275, including payments or allocations to entities eligible to claim local transportation funds under Article 4.5 (commencing with Section 99275). Notwithstanding anything to the contrary in this section, Section 99285 shall continue to apply in the County of Los Angeles.
Each transportation planning agency and county transportation commission, and the San Diego Metropolitan Transit Development Board shall create a state transit assistance fund and deposit therein the funds allocated to it pursuant to Sections 99313 and 99314. The funds attributable to Section 99313 shall be allocated for public transportation purposes, including for community transit services pursuant to Section 99275. Pursuant to subdivision (d) of Section 99312.2, the funds attributable to Section 99314 shall be allocated only to STA-eligible operators for public transportation purposes.
An allocation of funds from a state transit assistance fund for a transit capital project may be used for the payment of the principal of, and interest on, equipment trust certificates, bonded or other indebtedness, or in accomplishment of a defeasance of any outstanding revenue bond indenture issued for that project.
From funds allocated to it pursuant to Section 99313, the Metropolitan Transportation Commission may allocate funds to itself for projects to achieve regional transit coordination objectives.
From funds allocated to the Metropolitan Transportation Commission pursuant to Section 99313, upon a request of the Solano Transportation Authority, the commission may allocate an amount of funds to the authority for public transportation purposes, including countywide transit planning and coordination relative to Solano County.
From funds made available pursuant to subdivision (b) of Section 99312 and paragraph (1) of subdivision (a) of Section 99312.1, an amount shall be allocated by the Controller to each transportation planning agency and county transportation commission, and the San Diego Metropolitan Transit Development Board. The allocation shall include an amount corresponding to the STA-eligible operators within the jurisdiction of each transportation planning agency and county transportation commission, and the San Diego Metropolitan Transit Development Board. The amount allocated to a transportation planning agency and county transportation commission, and the San Diego Metropolitan Transit Development Board shall be based on the ratio that the total qualifying revenue of all STA-eligible operators in the area under jurisdiction of the agency, commission, or board bears to the total qualifying revenue of all STA-eligible operators in the state.
For purposes of this section and Section 99314.3, “qualifying revenue” means fare revenues, including fares generated for community transit services under contract with the STA-eligible operator, and any other funds used by the operator in the delivery of transit service, except federal and state funds. The revenue amount for each STA-eligible operator shall be determined from the annual report submitted to the Controller pursuant to Section 99243. Revenue used for capital expenditures or depreciation shall not constitute qualifying revenue. The revenue share for the Altamont Corridor Express and the Southern California Regional Rail Authority shall be determined by the qualifying revenues reported to the Controller in accordance with subdivision (b) of Section 99314.1 and subdivision (b) of Section 99314.2, respectively.
An STA-eligible operator qualifies to receive STA funding pursuant to this section beginning on the date when it commences revenue passenger service. A new STA-eligible operator shall notify the Controller in writing that it has commenced revenue passenger service within 10 business days of beginning the service. A new STA-eligible operator that commences revenue passenger service before August 1 of a fiscal year shall be eligible to receive funds in that fiscal year based on the qualifying revenue reported to the Controller two years before that fiscal year, consistent with subdivision (e). If a new STA-eligible operator commences revenue passenger service on or after August 1 of a fiscal year, the Controller shall calculate the operator’s pro rata share of STA funds under this section for that fiscal year based on the date the operator commenced revenue passenger service. That amount shall be added as an adjustment to an operator’s STA funding for the subsequent fiscal year, and the adjustment shall be drawn as an off-the-top reduction from the first quarter of STA funds under this section.
The Controller shall determine allocation amounts pursuant to this section based on the qualifying revenue reported two years before the fiscal year in which the funds are allocated.
Qualifying revenue for a given fiscal year shall not exceed an STA-eligible operator’s annual operating expenses, as reported to the Controller. Operating expenses include, but are not limited to, the direct cost of operating transit service, payments by the STA-eligible operator for community transit service provided by entities that are not eligible to receive funds directly pursuant to subdivision (a) of Section 99314.3, administrative costs, and routine maintenance. Operating expenses do not include transfers from an operating budget to a capital account.
For the purpose of allocating funds pursuant to this section, Section 99314.1, and 99314.2, “STA-eligible operator” includes the Altamont Corridor Express and the Southern California Regional Rail Authority. The revenue share for these operators shall be based on the qualifying revenue used to operate the systems consistent with subdivision (b), including fares and the amounts contributed by the parties to the cooperative service agreement in the case of the Altamont Corridor Express, and by the member agencies in the case of the Southern California Regional Rail Authority.
Funds allocated by the Controller to a transportation planning agency or county transportation commission, or the San Diego Metropolitan Transit Development Board pursuant to this section shall be allocated by the agency, commission, or board to STA-eligible operators pursuant to Section 99314.3.
For purposes of this section, the following terms have the following meanings:
The “Altamont Corridor Express” or the “authority” is the joint powers agency duly formed pursuant to Article 1 (commencing with Section 6500) of Chapter 5 of Division 7 of Title 1 of the Government Code, by and between the Alameda Congestion Management Agency, the Santa Clara Valley Transportation Authority, and the San Joaquin Regional Rail Commission. Any reference to the “Altamont Corridor Express” or the “authority” shall be construed to include a reference to any entity that is a successor to the authority.
“Qualifying revenue” means qualifying revenue, as defined in subdivision (b) of Section 99314, that is derived from operating as a member agency of the authority.
The authority shall report to the Controller, for each fiscal year, the ratio that the qualifying revenue of each member agency of the authority bears to the total qualifying revenue of the authority during that fiscal year. The authority shall provide the ratios within the timeframe specified by subdivision (a) of Section 99243.
From funds made available pursuant to subdivision (b) of Section 99312 and paragraph (1) of subdivision (a) of Section 99312.1, the Controller shall allocate to the transportation planning agencies in the jurisdictions of the parties to the cooperative service agreement an amount for each member agency of the authority that is based on the ratio provided under subdivision (b), for allocation pursuant to subdivision (c) of Section 99314.3.
The allocation set forth in paragraph (1) shall be in addition to any other allocation provided under this article.
Allocations made under this section shall be used only for STA program purposes authorized under this chapter.
For purposes of this section, the following terms have the following meanings:
The “Southern California Regional Rail Authority” or the “authority” is that joint powers authority described in Section 14072 of the Government Code and includes any additional agencies that may join the authority under Section 14072.2 of that code.
“Qualifying revenue” means qualifying revenue, as defined in subdivision (b) of Section 99314, that is derived from operating as a member agency of the authority.
The Southern California Regional Rail Authority shall report to the Controller, for each fiscal year, the ratio that the qualifying revenue of each member agency of the authority bears to the total qualifying revenue of the authority during that fiscal year. The authority shall provide the ratios within the timeframe specified by subdivision (a) of Section 99243.
From funds made available pursuant to subdivision (b) of Section 99312 and paragraph (1) of subdivision (a) of Section 99312.1, the Controller shall allocate to the county transportation commissions in the jurisdictions of the member agency’s area an amount for each member agency of the authority that is based on the ratio provided under subdivision (b), for allocation pursuant to subdivision (c) of Section 99314.3.
The allocation set forth in paragraph (1) shall be in addition to any other allocation provided under this article.
Allocations made under this section shall be used only for STA program purposes authorized under this chapter.
The amount allocated to each transportation planning agency and county transportation commission, and the San Diego Metropolitan Transit Development Board pursuant to Section 99314 shall be allocated by those entities to the STA-eligible operators in the area of their respective jurisdictions.
The amount allocated by a transportation planning agency and county transportation commission, and the board to each STA-eligible operator pursuant to Section 99314 shall be based on the ratio that the operator’s qualifying revenue bears to the total qualifying revenue of all STA-eligible operators within the area of jurisdiction of the transportation planning agency, county transportation commission, or board. The Controller shall publish the share of funds corresponding to each STA-eligible operator as well as the total amount to be allocated to each transportation planning agency, county transportation commission, or board.
The amount allocated by the Controller to a transportation planning agency corresponding to the parties to the cooperative service agreement of the Altamont Corridor Express and the member agencies of the Southern California Regional Rail Authority, pursuant to Section 99314, shall be allocated by the transportation planning agency in the jurisdiction of the parties to the cooperative services agreement or the member agency’s area for STA program purposes authorized in this chapter. The allocation shall be based on the ratio that the qualifying revenues bear to the qualifying revenue of all STA-eligible operators.
For purposes of subdivision (a), the City and County of San Francisco with respect to its municipal railway system, the Alameda-Contra Costa Transit District, and the San Francisco Bay Area Rapid Transit District shall be considered one operator. The amount allocated to them as one operator shall be apportioned to each of them based on the ratio of its revenue to the sum of their revenues, excluding from the determination of that ratio the amount allocated to each of them pursuant to Section 29142.2.
An operator in an urbanized area having a population of less than 200,000 persons may elect to participate in the funding exchange program authorized by this subdivision. An operator electing to participate in the funding exchange program shall give notice to the director and shall indicate the amount of funds which it wants allocated for the funding exchange program.
From funds that would otherwise be allocated to an operator under the State Transit Assistance Program, an amount so designated by the participating operator shall be allocated to the department for transfer pursuant to an agreement between the department and the State of Arizona whereby California can receive federal mass transportation funds originally apportioned to the State of Arizona.
The department shall allocate the federal mass transportation funds so received to each participating operator in the same proportion as the operator contributed to the funding exchange program. Funds so received shall be used only for the purposes of the State Transit Assistance Program and are subject to all statutes and rules and regulations applicable to funds allocated pursuant to Sections 99313 and 99314.
The Legislature finds and declares that the exchange of state funds for federal mass transportation funds authorized by this section will result in a net increase in the total amount of funds to be available to the participating operators.
A transportation planning agency or county transportation commission, or the San Diego Metropolitan Transit Development Board may authorize an STA-eligible operator under its jurisdiction to exchange funds allocated to it pursuant to Section 99314 for funds made available pursuant to Section 99231. Any funds allocated pursuant to Section 99314 that are exchanged pursuant to this section shall only be available to other STA-eligible operators and shall be used for STA program purposes authorized by this chapter and are subject to all statutes and rules and regulations applicable to funds allocated pursuant to Section 99314. Exchanges pursuant to this section shall be on a dollar-for-dollar basis.
It is the intent of the Legislature that, in allocating the funds available pursuant to Section 99313, the transportation planning agencies and county transportation commissions, and the San Diego Metropolitan Transit Development Board give priority consideration to offsetting reductions in federal operating assistance and the unanticipated increase in the cost of fuel, to enhancing existing public transportation services, and to meeting high-priority regional, countywide, or areawide public transportation needs.
Nothing in this section shall be construed to prohibit, or limit the ability of, a public transit operator to do the following:
Contract with common carriers of persons operating under a franchise or license.
Employ part-time drivers.
Except as provided in subdivision (e) and Section 99314.7, the following eligibility standards apply:
The operator shall receive its entire allocation, and any or all of this allocation may be used for operating purposes, if the operator’s total operating cost per revenue vehicle hour in the latest year for which audited data are available does not exceed the sum of the preceding year’s total operating cost per revenue vehicle hour and an amount equal to the product of the percentage change in the Consumer Price Index for the same period multiplied by the preceding year’s total operating cost per revenue vehicle hour.
The operator shall receive its entire allocation, and any or all of this allocation may be used for operating purposes, if the operator’s average total operating cost per revenue vehicle hour in the latest three years for which audited data are available does not exceed the sum of the average of the total operating cost per revenue vehicle hour in the three years preceding the latest year for which audited data are available and an amount equal to the product of the average percentage change in the Consumer Price Index for the same period multiplied by the average total operating cost per revenue vehicle hour in the same three years.
If an operator does not meet either efficiency standard under paragraph (1), the operator shall receive its entire allocation and the funds shall be allocated pursuant to this paragraph. The portion of the allocation that the operator may use for operations shall be the total allocation to the operator reduced by the lowest percentage by which the operator’s total operating cost per revenue vehicle hour for the applicable year or three-year period calculated pursuant to subparagraph (A) or (B) of paragraph (1) exceeded the target amount necessary to meet the applicable efficiency standard. The remaining portion of the operator’s allocation shall be used only for capital purposes.
The transportation planning agency or county transportation commission, or the San Diego Metropolitan Transit Development Board, as the case may be, shall adjust the calculation of operating costs and revenue vehicle hours pursuant to paragraph (1) to account for either or both of the following factors:
Exclusion of cost increases beyond the change in the Consumer Price Index for fuel; alternative fuel programs; power, including electricity; insurance premiums and payments in settlement of claims arising out of the operator’s liability; or state or federal mandates.
Exclusion of the costs and revenue vehicle hours required to provide comparable complementary paratransit service as required by Section 37.121 of Title 49 of the Code of Federal Regulations, pursuant to the federal Americans with Disabilities Act of 1990 (42 U.S.C. Sec 12101 et seq.), as identified in the operator’s paratransit plan pursuant to Section 37.139 of Title 49 of the Code of Federal Regulations, costs and revenue vehicle hours required to operate demand response and microtransit services that expand access to transit service beyond fixed route corridors, costs of funding or improving payment and ticketing systems and services, costs of security services and public safety contracts, any expense greater than the actuarially determined contribution associated with pensions and other post-employment benefits as required by Government Accounting Standards Board Statement Numbers 68 and 75, costs of planning for improvements in transit operations, integration with other operators and agencies, transitioning to zero-emission operations, and for compliance with state and federal mandates, and startup costs for new services for a period of not more than two years.
As used in this section, the following terms have the following meanings:
“Consumer Price Index,” as applied to an operator, is the regional Consumer Price Index for that operator’s region, as published by the United States Bureau of Labor Statistics. If a regional index is not published, the index for the State of California applies.
“Microtransit” means IT-enabled multipassenger transportation services that serve passengers using dynamically generated routes, and may expect passengers to make their way to and from common pick-up or drop-off points. Microtransit vehicles include, but are not limited to, large sport utility vehicles, vans, and shuttle buses.
“New service” has the same meaning as “extension of public transportation services” as defined in Section 99268.8.
“Revenue vehicle hours” has the same meaning as “vehicle service hours,” as defined in subdivision (h) of Section 99247.
The restrictions in this section do not apply to allocations made for capital purposes.
The exclusion of cost increases described in paragraph (3) of subdivision (a) applies solely for the purpose of calculating an operator’s eligibility to claim funds pursuant to this section and does not authorize an operator to report an operating cost per revenue vehicle hour, other than as described in this section and in Section 99247, to any of the following entities:
Notwithstanding subdivision (a), an operator is exempt from meeting either efficiency standard under paragraph (1) of subdivision (a) for the 2020–21 to 2026–27, inclusive, fiscal years, and may use the funds allocated pursuant to Sections 99313 and 99314 for operating or capital purposes during that period of time.
An operator is not eligible for its full allocation under this section unless the operator has been found to have made reasonable effort in implementing productivity improvements pursuant to Section 99244. In determining whether a reasonable effort has been made, the Metropolitan Transportation Commission shall give consideration to whether the operator would qualify for funding under Section 99314.6. The amount of funds allocated shall be reduced in an amount that the Metropolitan Transportation Commission deems proportionate to the failure of the operator to implement the recommended improvements. The Metropolitan Transportation Commission shall adopt rules and regulations, in cooperation with the affected operators, governing the allocation of any funds withheld under this paragraph, subject to paragraphs (2) and (3).
Notwithstanding paragraph (1), an operator shall not receive any funds pursuant to Section 99313 or 99314 unless it has complied with the applicable rules , regulations, and recommendations adopted by the Metropolitan Transportation Commission pursuant to Sections 66516 and 66516.5 of the Government Code.
Funds withheld from allocation to an operator pursuant to paragraph (1) shall be retained by the Metropolitan Transportation Commission for reallocation to that operator for two years following the year of ineligibility. With respect to the funds withheld from an operator pursuant to paragraph (1), the Metropolitan Transportation Commission shall reallocate those funds to the operator if the operator complies with that paragraph within two years. Funds not reallocated to the operator, and funds withheld pursuant to paragraph (2), shall be allocated to any eligible operator within the region subject to the jurisdiction of the Metropolitan Transportation Commission for the purpose of improving coordination among the operators, or to any operator whose increase in total operating cost per revenue vehicle hour is less than the increase in the Consumer Price Index. Funds allocated for these purposes are exempt from subdivision (a).
For purposes of this section, “operating cost,” “revenue vehicle hour,” and “Consumer Price Index” have the same meaning as defined in Section 99314.6.
Notwithstanding any other law, for the third and fourth quarters of the 2015–16 fiscal year, and for all four quarters of the 2016–17 fiscal year, the Controller shall calculate and publish the allocation of all funds made pursuant to Section 99314 to each transportation planning agency and county transportation commission, the San Diego Metropolitan Transit Development Board, the member agencies of the Altamont Commuter Express Authority, and the member agencies of the Southern California Regional Rail Authority based on the same list of operators and the same individual operator ratios published by the Controller in its original Fourth Quarter State Transit Assistance Allocation transmittal memo for the 2014–15 fiscal year, unless the Controller has subsequently published revisions or adjustments to its original Fourth Quarter State Transit Assistance Allocation transmittal memo for the 2014–15 fiscal year, in which case the revised or adjusted list of operators and individual operator ratios shall be used.
Each transportation planning agency and county transportation commission, and the San Diego Metropolitan Transit Development Board may apply the individual operator ratios calculated for the third quarter of the 2015–16 fiscal year pursuant to this section to any undistributed funds remaining from the first and second quarters of the 2015–16 fiscal year.
Upon allocation of funds pursuant to this section to each transportation planning agency and county transportation commission, the San Diego Metropolitan Transit Development Board, the member agencies of the Altamont Commuter Express Authority, and the member agencies of the Southern California Rail Authority, the Controller shall publish the amount of funding applicable to each operator.
Commencing with the 2017–18 fiscal year, for the estimates described in Section 99312.7, the Controller shall publish the allocations for each eligible recipient agency, including one list applicable to revenues allocated pursuant to subdivision (c) of Section 99312.1 and another list for revenues allocated from all other revenues in the Public Transportation Account that are designated for the State Transit Assistance Program.
Notwithstanding any other law, for the 2020–21 to 2025–26, inclusive, fiscal years, the Controller shall calculate and publish the allocation of funds made pursuant to Section 99314 to each transportation planning agency and county transportation commission, the San Diego Metropolitan Transit Development Board, the member agencies of the Altamont Commuter Express Authority, and the member agencies of the Southern California Regional Rail Authority based on the same individual operator ratios published by the Controller in its August 2020 State Transit Assistance Allocation transmittal memo, or as the Controller may subsequently revise that memo before June 30, 2026, to account for an STA-eligible operator’s termination of transit operations during those fiscal years or for a new STA-eligible operator, as described in subdivision (c) of Section 99314, during those fiscal years.
In calculating the individual operator ratios for the August 2020 State Transit Assistance Allocation transmittal memo described in subdivision (a), the Controller shall use the data from the most recent annual report submitted by each STA-eligible operator to the Controller pursuant to Section 99243, except that the Controller shall not use data from a fiscal year before the 2017–18 fiscal year. For a subsequent revision to the memo, as described in subdivision (a), the Controller shall incorporate the data from the most recent annual report submitted by a new STA-eligible operator pursuant to Section 99243 into the data used in the memo for existing STA-eligible operators.
Upon allocation of funds pursuant to this section to each transportation planning agency and county transportation commission, the San Diego Metropolitan Transit Development Board, the member agencies of the Altamont Commuter Express Authority, and the member agencies of the Southern California Regional Rail Authority, the Controller shall publish the amount of funding allocated to each operator.
Notwithstanding any other law and except as specified in subdivision (b), Sections 99314.6 and 99314.7 do not apply to an operator for a fiscal year in which the operator expended from local funding an amount for transit operations not less than the amount the operator expended from local funding for transit operations during the 2018–19 fiscal year. As used in this subdivision, “local funding” means any nonstate grant funds or other revenues generated by, earned by, or distributed to, an operator.
For purposes of verifying the expenditures described in subdivision (a), the Controller may request fiscal data from the operator or conduct an audit of the operator.
This section shall become inoperative on July 1, 2026, and, as of January 1, 2027, is repealed.
Funds made available pursuant to subdivision (a) of Section 99312 shall be available for all of the following purposes:
To the department for funding of public transit capital improvement projects in the state transportation improvement program, pursuant to Section 14529 of the Government Code.
To the department for its planning activities not payable from the State Highway Account in the State Transportation Fund, its mass transportation responsibilities, and its assistance in regional transportation planning.
To the department for allocation by the director to the Institute of Transportation Studies of the University of California for training and research in public transportation systems engineering and management and coordination with other transportation modes.
To the commission for its activities not payable from the State Highway Account.
To the Public Utilities Commission for its passenger rail safety responsibilities specified in statute on commuter rail, intercity rail, and urban rail transit lines.
For transfer to the Transportation Debt Service Fund created by Section 16965 of the Government Code to reimburse the General Fund for current year debt service payments on rail and transit-related general obligation bonds other than those issued pursuant to the Clean Air and Transportation Improvement Act of 1990 (Part 11.5 (commencing with Section 99600)), as follows:
For the 2009–10 fiscal year, the Controller shall transfer up to one hundred forty-two million fifty-eight thousand dollars ($142,058,000) to the fund upon order of the Director of Finance for debt service paid or payable within that fiscal year.
For the 2010–11 fiscal year, the Controller shall transfer up to ninety million eight hundred eighty-six thousand dollars ($90,886,000) in revenues collected before November 2, 2010, to the fund, as follows:
By the 15th of every month, the Treasurer, in consultation with the Director of Finance, shall notify the Controller of the amount of debt service that will be paid on each transportation bond during that month.
Within two business days following the 28th of every month, the Controller shall transfer from the account to the Transportation Debt Service Fund an amount equal to monthly debt service paid by the General Fund on any bonds issued pursuant to Proposition 108 (1990) and Proposition 1A (2008), and one-quarter of the monthly debt service paid by the General Fund on any bonds issued pursuant to Proposition 1B (2006).
Any transfers made from the Public Transportation Account pursuant to this subdivision for any months after October 2010 shall be reversed and repaid to the account, and shall instead be made, to the extent authorized, from weight fee revenues in the State Highway Account as provided for in Section 9400.4 of the Vehicle Code.
All funds from the Public Transportation Account and the State Highway Account, State Transportation Fund, previously allocated by the commission or the department to the new Fresno Amtrak Station project shall also be available for expenditure on any form of Amtrak project in the Fresno downtown area, including, but not limited to, the rehabilitation of the former Santa Fe Railway station, as approved by the commission or the department or the commission and the department. The encumbering and expending of funds for this project is not subject to an additional allocation action or approval action, or both actions, by the commission.
All funds from the Public Transportation Account and the State Highway Account, in the State Transportation Fund, previously allocated by the commission for specific track repair and rolling stock acquisitions through resolutions number MFP-95-05, MFP-95-10, MPFP-95-01, MFA-96-01, and MBFA-98-01 shall also be available for expenditure on any form of track improvement project, track rehabilitation project, or rolling stock acquisition project nominated by the North Coast Railroad Authority, as approved by the commission. Projects nominated by the North Coast Railroad Authority, for which funds in the State Highway Account in the State Transportation Fund are to be used, are also required to be eligible under Article XIX of the California Constitution. The encumbering and expending of funds for this project is not subject to an additional allocation action or approval action, or both actions, by the commission.
All funds from the Public Transportation Account and the State Highway Account, in the State Transportation Fund, previously allocated by the California Transportation Commission to the City of Seaside for the acquisition of right-of-way for the Fort Ord rail station shall also be available for expenditure by the Transportation Agency for Monterey County for work at the Monterey Bay rail station. The commission shall oversee the timely use of these funds in accordance with the requirements specified in current law.
Funds made available pursuant to subdivision (b) of Section 99315 shall be appropriated to the department for allocation, as directed by the commission, to fund public transit capital improvement projects that maintain or improve public transit service.
Funds made available for capital outlay pursuant to subdivision (a) of Section 14031.6 of the Government Code and subdivision (a) of Section 99315 shall be appropriated to the department, as directed by the commission, solely for capital outlay improvements and rolling stock on intercity rail passenger routes.
The Legislature may amend this section, by statute passed in each house of the Legislature by rollcall vote entered in the journal, two-thirds of the membership concurring, if the statute is consistent with, and furthers the purposes of, this section.
Funds appropriated pursuant to subdivision (a) of Section 99317 shall, in addition to the purposes specified in that section, be available for short-line railroad rehabilitation projects, through the state transportation improvement program.
Projects eligible for funding pursuant to this subdivision shall be limited to railroad rehabilitation projects.
To be eligible for funding pursuant to this subdivision, a project proposal shall be submitted by a public entity. The public entity shall submit a project proposal only if it has made a finding, following a public hearing, that rail service on the affected railroad would be in imminent danger of being discontinued without the expenditure of public funds, and that continuation of the service serves a public purpose.
As used in this section, “short-line railroad” means any standard gauge railroad which is being, or is planned to be, used for passenger service, other than a class I railroad, as that term is used and applied in federal law.
A public agency that has received an allocation for funding of an intermodal transfer station pursuant to subdivision (a) of Section 99317 shall provide for maintaining the station and its appurtenances, including, but not limited to, restroom facilities, in good condition and repair, and in accordance with high standards of cleanliness. As part of its duties in monitoring state-funded rail and bus services, the department shall, at least annually, conduct an unannounced inspection of each facility and make recommendations, if any, to the operating agency. Results of the department’s inspections shall be included in the passenger rail element of the State Rail Plan required pursuant to Section 14036 of the Government Code. If appropriate remedial action is not taken, the department may recommend to the commission that future applications for transit capital funding be denied.
The Legislature finds and declares that regular inspections of intermodal stations are necessary to protect the state’s capital investment in these essential transportation facilities and to avoid the problems resulting from deferred maintenance.
The department and the commission shall give reasonable priority to allocations pursuant to subdivision (a) of Section 99317 to station projects that improve access for visitors to state prisons.
A public entity which has received an allocation for funding of an intermodal transfer station pursuant to subdivision (a) of Section 99317 shall, upon request of the department, authorize state-funded bus service to use the station without any charge to the department or its contractors, and shall assist the department in the placement of signs and informational material designed to alert the public to the availability of the state-funded bus service.
A public entity shall not be eligible to receive an allocation for funding of an intermodal transfer station pursuant to subdivision (a) of Section 99317 unless it first agrees that, upon any future request of the department, it will authorize a state-funded bus service to use the station without any charge to the department or its contractors and it will assist the department in the placement of signs and informational material designed to alert the public to the availability of the state-funded bus service.
For the purpose of this section, “state-funded bus service” means any bus service funded pursuant to Section 99316.
If a rail capital improvement project proposed for funding by the department or a local agency includes as an element the addition or improvement of rail passenger service boarding platforms, those platforms shall be constructed in conformity with applicable rules and orders of the Public Utilities Commission and in such a manner that the top of each platform is not less than eight inches above the adjacent rails, unless the department makes a finding that the circumstances in a particular case warrant otherwise and obtains approval from the Public Utilities Commission for any deviation from its applicable rules and orders.
The requirements of this section apply to all passenger service boarding platforms constructed with funds made available pursuant to Section 14031.6 of the Government Code, Sections 99234.5, 99234.9 and 99317 of this code, Section 164 of the Streets and Highways Code, and funds made available from the proceeds of state general obligation bonds issued for the purposes of rail capital improvements.
ARTICLE 7. Limited Obligation Bonds [99320. - 99383.]
This article is not applicable in a county where the transit district has been provided bonding authority by statute.
If the transportation planning agency determines that the cost of an approved claim for capital expenditures for public transportation purposes, excluding highways, within a county is, together with all other approved claims to be paid from the local transportation fund of such county, in excess of the money in such fund for the fiscal year, the board of supervisors of such county shall be notified to call an election in conformity with the provisions of this article.
For purposes of this article, “limited obligation bonds” are bonds payable solely from the local transportation fund of the county. The money, or portion thereof, designated by the transportation planning agency in such fund to pay interest and redemption charges shall hereafter be referred to as “revenues.”
In determining the amount of bonds to be issued, the transportation planning agency may include:
All costs and estimated costs incidental to or connected with the acquisition, construction, improving or financing of the improvements.
All engineering, inspection, legal and fiscal agent’s fees, costs of the bond election and of the issuance of such limited obligation bonds, bond reserve funds and working capital and bond interest estimated to accrue during the construction period and for a period of not to exceed 12 months after completion of construction.
All costs for equipment.
The bonds and the resolution providing for their issuance shall state that they are limited obligation bonds payable solely from the revenues.
The term of bonds issued shall not exceed 31 years.
The bonds shall be sold as the transportation planning agency shall determine but for not less than a price which will produce a net interest cost that will not exceed an average of 7 percent a year as determined by standard tables of bond values.
The bonds are special obligations of the county and shall be a charge against and are secured by a lien upon and shall be payable, as to the principal thereof and interest thereon, and any premiums upon the redemption thereof, solely from the revenues and such funds as are described in the resolution authorizing the issuance of the bonds.
By resolution, the board of supervisors shall pledge, place a charge upon, and assign all or any part of the revenues for the security of the bonds.
The payment of interest on and principal of the bonds and any premiums upon the redemption of any thereof are secured by an exclusive pledge, charge, and lien upon all or the designated portion of the revenues.
The revenues and any interest earned on the revenues constitute a trust fund for the security and payment of the interest on and principal of the bonds.
So long as any bonds or interest thereon are unpaid following their maturity, the revenues or the designated portion and interest thereon shall not be used for any other purpose.
If the interest and principal of the bonds and all charges to protect or secure them are paid when due, an amount or amounts for other purposes may be apportioned from the revenues or the designated portion thereof.
Bonds of the same issue shall be equally secured by a pledge, charge, and lien upon the revenues specified in the resolution authorizing the issuance of the bonds, without priority for number, or date of bonds, of sale, of execution, or of delivery pursuant to this chapter and the resolution authorizing the issuance of the bonds; except that any county, with the consent of the transportation planning agency, may authorize the issuance of bonds of different series and may provide that the bonds in any series shall, to the extent and in the manner prescribed in the resolution, be subordinated and be junior in standing, with respect to the payment of principal and interest and the security thereof, to such other bonds as may be specified in the resolution.
The general fund or any other fund of the county shall not be liable for the payment of the bonds or their interest.
The general credit or taxing power of the county, other than the sales and use tax as herein provided, shall not be liable for the payment of the bonds or their interest.
The holder of the bonds or coupons shall not compel the exercise of the taxing power by the county, other than the sales and use tax as herein provided, or the forfeiture of its property.
The principal of and interest on the bonds and any premiums upon the redemption of any thereof are not a debt of the county, nor a legal or equitable pledge, charge, lien, or encumbrance upon any of its property, or upon any of its income, receipts, or revenues, except the revenues that may be legally applied, pledged, or otherwise made available to their payment.
Every bond shall recite in substance that the principal of and interest on the bond are payable solely from the revenues pledged to its payment and that the county is not obligated to pay it, except from the revenues.
The bonds and interest or income from the bonds are exempt from taxation in this state, except from gift, inheritance, and estate taxes.
In the resolution authorizing the bonds, the board of supervisors may, with the consent of the transportation planning agency, insert any of the provisions authorized by this article, which shall become a part of the contract with the bondholders.
The transportation planning agency may provide for limitations on:
The purpose to which the proceeds of sale of any issue of bonds may be applied.
The issuance of additional bonds for the same purpose and the lien of additional bonds.
The transportation planning agency may provide for events of default and terms upon which the bonds may be declared due before maturity and the terms upon which the declaration and its consequences may be waived.
The transportation planning agency may provide for the rights, liabilities, powers, and duties arising upon the county’s breach of any covenants, conditions, or obligations.
The transportation planning agency may provide for the vesting in a trustee of the right to enforce covenants to secure payment of or in relation to the bonds, and the trustee’s powers and duties and the limitation of his liabilities.
The transportation planning agency may provide for the terms upon which the bondholders or any percentage of them may enforce covenants or duties imposed by this article.
The transportation planning agency may require the board of supervisors to provide in the resolution for a procedure for amending or abrogating the terms of the resolution with the consent of the holders of a specified number of the bonds.
Any resolution containing such a procedure may also provide for meetings of bondholders or for their written assent without a meeting and the manner of consenting, with or without a meeting.
The resolution shall specifically state the effect of amendment upon the rights of the holders of all of the bonds and attached or detached interest coupons and shall be binding upon the holders of all of the bonds and coupons issued pursuant to the resolution.
The transportation planning agency may provide for any other acts and things necessary, convenient or desirable to secure the bonds or tending to make them more marketable.
The county shall pay or cause to be paid the principal and interest of the bonds on the date, at the place, and in the manner mentioned in the bonds and coupons and in accordance with the resolution authorizing their issuance.
During the period that any of the bonds and the interest thereon are unpaid, the county shall prescribe, revise and collect taxes in the manner provided by Part 1.5 (commencing with Section 7200) of Division 2 of the Revenue and Taxation Code.
After making allowances for contingencies and error in the estimates, the taxes, for the respective purposes hereinafter set forth, shall be at least sufficient to pay the following amounts in the order set forth:
The interest on and principal of the bonds as they become due and payable.
All payments required for compliance with the resolution authorizing the issuance of the bonds or any other contract with the bondholders, including the creation of sinking and reserve funds.
All payments to meet any other obligations of the county which are charges, liens, or encumbrances upon the revenues.
A separate, distinct and special account shall be created at or before the issuance of the bonds, which shall be maintained continuously in the local transportation fund during the time that any of the bonds or the interest thereon are outstanding and unpaid.
All designated revenues shall be deposited in the special account and payments shall be made therefrom as provided in Section 99351.
The county shall preserve and protect the security of the bonds and the rights of the bondholders and warrant and defend their rights against all claims and demands of all persons.
In order to fully preserve and protect the priority and security of the bonds, the county shall pay from the special account in the local transportation fund and discharge all lawful claims for labor, materials and supplies, which if unpaid may become a lien or charge upon the designated revenues prior or superior to the lien of the bonds or impair the security of the bonds.
The county shall hold in trust the revenues pledged to the payment of the principal of and interest on the bonds for the benefit of the bondholders and shall apply the same pursuant to the resolution authorizing the issuance of the bonds or to the resolution as modified.
The county may invest funds held in reserve, or in any sinking fund, or funds not required for immediate disbursement, in property or securities in which counties may legally invest funds subject to their control. No such investment shall be made in contravention of any covenant or agreement in any resolution authorizing the issuance of any outstanding bonds.
The county shall keep proper books of record and accounts of the revenues, separate from all other records and accounts, in which complete and correct entries shall be made of all transactions relating to the revenues.
At all times the books shall be subject to the inspection of the holders of not less than 10 percent of the outstanding bonds or their representatives authorized in writing.
The county shall cause to be published a summary statement showing the amount of revenues deposited which are required as security for payment of the principal of and interest on the bonds, the disbursements from such revenues in reasonable detail, and a general financial statement.
The statement shall be published annually, not more than 120 days after the close of each fiscal year. The county shall furnish a copy of the statement to any bondholder upon request.
In the resolution authorizing the bonds, the county may agree that the statement shall be prepared or audited by an independent certified public accountant and shall be in the form and contain the detail specified in the resolution.
The duties set forth in this article do not require the county to expend any funds other than revenues pledged to secure payment of the principal of or interest on bonds as provided in this article.
A fiscal or paying agent may be appointed as now or as may hereafter be provided in Article 7 (commencing with Section 54550), Chapter 6, Part 1, Division 2, Title 5 of the Government Code.
An action to determine the validity of bonds may be brought pursuant to Chapter 9 (commencing with Section 860) of Title 10 of Part 2 of the Code of Civil Procedure.
Bondholders shall have the remedies as now or as may hereafter be provided in Article 10 (commencing with Section 54640), Chapter 6, Part 1, Division 2, Title 5 of the Government Code.
The bonds may be refunded in the manner now or as may hereafter be provided in Article 11 (commencing with Section 54660), Chapter 6, Part 1, Division 2, Title 5 of the Government Code.
Without the issuance of bonds hereunder, a pledge or allocation from revenues for the payment of bonds and interest issued or to be issued under any other law, may be made upon the approval thereof in the manner provided for the issuance of bonds hereunder.
All bonds issued in pursuance of the provisions of this article shall by their issuance be conclusive evidence of the regularity, validity and legal sufficiency of all proceedings, acts and determinations in any wise pertaining thereto, had or made hereunder; and, after the same have been issued, no sales tax levied or collected for the purpose of paying the principal or interest on the bonds shall be held to be invalid or illegal, or set aside by reason of any error, informality, irregularity, omission or defect in any of the proceedings, acts or determinations in any wise pertaining to the issuance or payment of the bonds, and not amounting to a want of due process of law under the Constitution.
All bonds by their issuance in pursuance of the provisions of this article shall by their issuance be conclusive evidence of the regularity, validity and sufficiency of all proceedings, acts and determinations in any wise pertaining thereto, had or made hereunder.
Any action, suit or proceeding of any kind or nature in which the validity of any of the proceedings taken under the provisions of this article is questioned or attacked, shall be filed within 30 days after the day of the adoption of the resolution providing for the issuance of the bonds and in case such action is not brought raising such issue within such period, then thereafter all persons whatsoever shall be barred in any action, suit or proceeding from pleading, asserting or claiming that any of the proceedings or other actions herein specified, were defective, faulty or invalid in any respect.
This article and all of its provisions shall be liberally construed to the end that the purposes hereof may be effective. If any section, subsection, sentence, clause or phrase of this article is for any reason held to be unconstitutional, such decision shall not affect the validity of the remaining portion of this article. It is hereby declared that this article would have been passed irrespective of the fact that any one or more sections, subsections, sentences, clauses or phrases be declared unconstitutional.
Proceedings are initiated to issue bonds within the meaning of this article when the board of supervisors, by majority vote, adopts a resolution in conformity with the notification from the director.
At its next subsequent meeting, the board of supervisors shall pass an ordinance ordering the submission of the proposition of incurring a bonded debt for the purposes set forth in the resolution to the qualified voters of the county at an election held for that purpose.
Propositions for more than one object or purpose may be submitted at the same election.
The ordinance shall recite:
The object and purpose of incurring the indebtedness.
The estimated cost of the public improvements.
The amount of the principal of the indebtedness.
The rate or maximum rate of interest on the indebtedness, which shall not exceed 7 percent, and need not be recited if it does not exceed 412 percent. Such interest shall be payable semiannually, except that interest for the first year after the date of the bonds may be made payable at the end of such year.
The date of the election.
The manner of holding the election and the procedure for voting for or against the proposition.
The ordinance may provide that the estimated cost stated therein of the public improvements includes any or all of the following:
Legal or other fees incidental to or connected with the authorization, issuance and sale of the bonds.
The costs of printing the bonds and other costs and expenses incidental to or connected with the authorization, issuance and sale of the bonds.
If the public improvements are revenue-producing public works, bond interest estimated to accrue during the construction period and for a period of not to exceed 12 months after completion of construction.
If such statement is made, the proceeds of the sale of the bonds may be used to pay such of the foregoing as are stated in the ordinance.
This section shall not be construed to authorize a city to use the proceeds of the sale of bonds for a purpose for which it could not use its general fund.
The ordinance shall be published once a day for at least seven days in a newspaper published at least six days a week in the county, or once a week for two weeks in a newspaper published less than six days a week in the county.
If there are no such newspapers, it shall be posted in three public places in the county for two succeeding weeks.
No other notice need be given.
If an election called pursuant to this article is consolidated with any other election, the ordinance calling the bond election need not set forth the election precincts, polling places and officers of election, but may provide that the precincts, polling places and officers of election shall be the same as those set forth in the ordinance, order, resolution or notice calling or providing for or listing or designating the precincts, polling places and election officers for the election with which the election called pursuant to this article is consolidated, and shall refer to such ordinance, order, resolution or notice by number and title or date of adoption, or by date or proposed date of publication and the name of the newspaper in which publication has been or will be made, or by any other definite description.
Except as otherwise provided in the ordinance, the election shall be conducted as other county elections.
If two-thirds of the electors voting on the proposition vote for it, the bonds shall be issued.
When two or more propositions for incurring indebtedness are submitted at the same election, the votes cast for and against each proposition shall be counted separately.
If any proposition is defeated, the transportation planning agency shall reconsider the application pertaining thereto. Another election on a substantially similar proposition shall not be called within the county pursuant to this article within six months after the prior election.
ARTICLE 8. Other Claims for Funds [99400. - 99408.]
Claims may be filed under this article with the transportation planning agency by counties and cities for the following purposes and by transit districts for the purposes specified in subdivisions (c) to (f), inclusive:
Local streets and roads, and projects which are provided for use by pedestrians and bicycles.
Passenger rail service operations and capital improvements.
Payment to any entity which is under contract with a county, city, or transit district for public transportation or for transportation services for any group, as determined by the transportation planning agency, requiring special transportation assistance.
If the county, city, or transit district is being served by an operator, the contract entered into by the county, city, or transit district shall specify the level of service to be provided, the operating plan to implement that service, and how that service is to be coordinated with the public transportation service provided by the operator. Prior to approving any claim filed under this section, the transportation planning agency, or the county transportation commission in a county with such a commission, shall make a finding that the transportation services contracted for under subdivision (c) are responding to a transportation need not otherwise being met within the community or jurisdiction of the claimant and that, where appropriate, the services are coordinated with the existing transportation service.
Payments to counties, cities, and transit districts for their administrative and planning cost with respect to transportation services under subdivision (c).
Notwithstanding any other provision of this chapter, a claimant for funds pursuant to subdivision (c) may also receive payments for capital expenditures to acquire vehicles and related equipment, bus shelters, bus benches, and communication equipment for the transportation services.
Acquisition or lease of vans and related equipment for a farmworker vanpool program for purposes of farmworker transportation to and from work, provided the farmworker vanpool program shall use vans or related equipment for a commuter vanpool as defined by Section 37.3 of Title 49 of the Code of Federal Regulations and the regional transportation planning agency conforms with the planning requirements of Section 5306 of Title 49 of the United States Code and Part 613 (commencing with Section 613.100) of Chapter VI of Title 49 of the Code of Federal Regulations.
Notwithstanding Section 99232, a county or a city in a county in which there is no countywide transit district may file a claim under this article with the transportation planning agency to finance the construction and maintenance of multimodal transportation terminals. The terminals may be located anywhere in the county or city, as the case may be.
Notwithstanding Section 99232, the County of San Diego may file a claim under this article with the transportation planning agency to provide express bus service or vanpool service for the purpose of serving work commute trips and for providing accessibility between residential areas and major activity centers.
The express bus service may be located anywhere in the county, but shall be consistent with the plans of the San Diego Metropolitan Transit Development Board and the North San Diego County Transit Development Board, and may be provided by contract with operators, private entities operating under a franchise or license, or nonprofit corporations organized pursuant to Division 2 (commencing with Section 9000) of Title 1 of the Corporations Code.
The vanpool service shall be operated by the county with county-owned vans and any claims submitted pursuant to this section for such service shall be approved subject to all of the following conditions:
The amount of the claim to be limited to the actual cost of acquiring the vans.
The local transportation fund to be reimbursed for the amount of the claim within the passenger service life of the vans.
Notwithstanding Sections 99232, 99268.3, and 99405, cities within the County of San Diego may file a claim under this article with the transportation planning agency to provide commuter ferry service on San Diego Bay for the purpose of serving peak period commute trips for pedestrians and bicycles. The commuter ferry service may be located anywhere on San Diego Bay, but shall be consistent with the regional transportation plan, shall serve employment centers and high volume activity centers, and may be provided by contract with operators, private entities operating under a franchise or license, or nonprofit corporations organized pursuant to Division 2 (commencing with Section 5000) of Title 1 of the Corporations Code.
The transportation planning agency shall adopt rules and regulations delineating procedures for the submission of claims under Section 99234 and subdivision (a) of Section 99400 and stating criteria by which they will be analyzed and evaluated. Such rules and regulations shall provide for orderly and periodic distributions of moneys.
The criteria applicable to analyzing and evaluating claims for nonmotorized transportation facilities shall be the general design criteria for such facilities established pursuant to Section 156.4 of the Streets and Highways Code.
To the extent necessary to perform its duties under this article, the transportation planning agency shall have full access to the books, records, and accounts of the claimant cities and counties.
Prior to making any allocation not directly related to public transportation services, specialized transportation services, or facilities provided for the exclusive use of pedestrians and bicycles, or any allocation for purposes of subdivision (f) of Section 99400, the transportation planning agency shall annually do all of the following:
Consult with the social services transportation advisory council established pursuant to Section 99238.
Identify the transit needs of the jurisdiction which have been considered as part of the transportation planning process, including the following:
An annual assessment of the size and location of identifiable groups likely to be transit dependent or transit disadvantaged, including, but not limited to, the elderly, the disabled, including individuals eligible for paratransit and other special transportation services pursuant to Section 12143 of Title 42 of the United States Code, the federal Americans with Disabilities Act of 1990 (42 U.S.C. Sec. 12101 et seq.), and persons of limited means, including, but not limited to, recipients under the CalWORKs program.
An analysis of the adequacy of existing public transportation services and specialized transportation services, including privately and publicly provided services necessary to implement the plan prepared pursuant to Section 12143(c)(7) of Title 42 of the United States Code, in meeting the transit demand identified pursuant to paragraph (1).
An analysis of the potential alternative public transportation and specialized transportation services and service improvements that would meet all or part of the transit demand.
An analysis of the need to acquire or lease vans and related equipment for a farmworker vanpool program pursuant to subdivision (f) of Section 99400. This analysis is only required, however, upon receipt by the transportation planning agency of a request of an interested party identifying a potential need.
Identify the unmet transit needs of the jurisdiction and those needs that are reasonable to meet. The transportation planning agency shall hold at least one public hearing pursuant to Section 99238.5 for the purpose of soliciting comments on the unmet transit needs that may exist within the jurisdiction and that might be reasonable to meet by establishing or contracting for new public transportation or specialized transportation services or by expanding existing services. The definition adopted by the transportation planning agency for the terms “unmet transit needs” and “reasonable to meet” shall be documented by resolution or in the minutes of the agency. The fact that an identified transit need cannot be fully met based on available resources shall not be the sole reason for finding that a transit need is not reasonable to meet. An agency’s determination of needs that are reasonable to meet shall not be made by comparing unmet transit needs with the need for streets and roads.
Adopt by resolution a finding for the jurisdiction, after consideration of all available information compiled pursuant to subdivisions (a), (b), and (c). The finding shall be that (1) there are no unmet transit needs, (2) there are no unmet transit needs that are reasonable to meet, or (3) there are unmet transit needs, including needs that are reasonable to meet. The resolution shall include information developed pursuant to subdivisions (a), (b), and (c) which provides the basis for the finding.
If the transportation planning agency adopts a finding that there are unmet transit needs, including needs that are reasonable to meet, then the unmet transit needs shall be funded before any allocation is made for streets and roads within the jurisdiction.
The transportation planning agency shall not allocate funds for purposes of subdivision (f) of Section 99400 until all of the capital and operating funds necessary to meet unmet transit needs that are reasonable to meet are allocated. The transportation planning agency shall not reduce funding to existing public transportation services, specialized transportation services, or facilities for the exclusive use of pedestrians and bicycles in order to allocate funds for purposes of subdivision (f) of Section 99400. The transportation planning agency shall not allocate funds under subdivision (f) of Section 99400 if the allocation replaces other federal, state, or local funds used to fund commuter vanpools by a county, city, transportation planning agency, or transit district.
Upon adoption of a finding, pursuant to subdivision (d) of Section 99401.5 that there are no unmet transit needs or that there are no unmet transit needs that are reasonable to meet, the transportation planning agency may allocate funds for local streets and roads. The allocation shall not become effective until 20 days after acknowledgment of receipt by the Department of Transportation of documents of the agency’s finding. The transportation planning agency shall, in any case, submit the documentation before August 15 of the fiscal year of the allocation or within 10 days after the adoption of the finding, whichever is later. The documentation shall include all of the following:
A copy of the notice of hearing and proof of publication and a description of the actions taken to solicit citizen participation pursuant to Section 99238. 5.
A copy of the resolution or minutes documenting the transportation planning agency’s definitions of “unmet transit needs” and “reasonable to meet,” as determined pursuant to subdivision (c) of Section 99401.5.
A copy of the resolution adopting the unmet needs finding described in subdivision (d) of Section 99401.5.
Claims for streets and roads may include those purposes necessary and convenient to the development, construction, and maintenance of the city or county’s streets and highways network, including planning and contributions to the transportation planning process, acquisition of real property, and construction of facilities and buildings.
In the County of Tuolumne, claims by the county or by a city within the county for streets and roads may also include contributions to the state for the construction and development of State Highway Route 108 from Lime Kiln Road to Phoenix Lake Road, if the county transportation commission determines that it is in the best interest of the county or the city and serves the public interest of the county or city to contribute local transportation funds for the construction and development of that portion of Route 108. The Legislature recognizes that under Section 73 of the Streets and Highways Code that portion of Route 108 is required to be relinquished to local control upon completion of the Sonora Bypass and bypass extension.
Except as otherwise provided in this section, the allocation for any purpose specified in Section 99400 may in no year exceed 50 percent of the amount required to meet the city’s or county’s total proposed expenditures for that purpose.
With respect to budgeted capital requirements for major new facilities, the transportation planning agency, notwithstanding the 50-percent limitation, may allocate up to the amount so budgeted, if the construction of the facilities has been found to be not inconsistent with the transportation planning agency’s regional transportation plan.
The 50-percent limitation shall not apply to the allocation to a city, county, or transit district for services under contract pursuant to subdivision (c) or (d) of Section 99400. The city, county, or transit district that is not in compliance with Section 99268.20 shall be subject to Section 99268.3, 99268.4, 99268.5, or 99268.9, as the case may be, and shall be deemed an operator for purposes of those sections, or shall be subject to regional, countywide, or county subarea performance criteria, local match requirements, or fare recovery ratios adopted by resolution of the transportation planning agency or the county transportation commission for those services.
If a transportation planning agency or county transportation commission has adopted performance criteria, local match requirements, or fare recovery ratios, the rules and regulations of the agency or commission shall apply, and Sections 99205.7 and 99241, subdivision (a) of Section 99247, and Section 99268.8 shall not apply.
The 50-percent limitation shall not apply to funds allocated under this article to a city or county with a population of less than 5,000, and, notwithstanding Section 99400, the city or county may claim funds under this article for transportation services, including associated capital, planning, and administrative costs, without contracting with another entity.
The 50-percent limitation shall not apply to funds allocated under this article for local street and road purposes.
Expenditures of moneys received for streets and highways purposes under this article shall be reported to the Controller by way of inclusion of information regarding those expenditures in the report prepared pursuant to Chapter 4 (commencing with Section 2150) of Division 3 of the Streets and Highways Code.
The Controller shall also prepare a summary of those expenditures, which shall include a list of the jurisdictions for which funds have been allocated for streets and roads under this article, the amount of the allocations, and the total funds made available to each jurisdiction pursuant to Article 3 (commencing with Section 99230). The Controller shall submit the report annually to the Legislature commencing January 1, 1989.
Notwithstanding any other provision of this chapter, the transportation planning agency may approve claims filed by a city for the construction of facilities for the exclusive use of pedestrians and bicycles, if the city is not expected to be served by public transportation within three years of the filing of the claims.
Any action to review, set aside, void, or annul the decision of a transportation planning agency made pursuant to Section 99401.5 shall be filed within 30 days after the agency makes its decision, or after the secretary has reviewed the decision pursuant to Section 99242, whichever is later. However, the action need not be filed until September 15 if the action is with respect to a decision made prior to August 15 for the fiscal year which commenced on the July 1 immediately preceding such August 15.
ARTICLE 9. Joint Development Authority [99420. - 99420.]
Notwithstanding any other provision of law, a transit operator may enter into agreements with a public agency, public utility, or person or entity, to be performed within the district, or a transportation corridor or land that shall be acquired by the transit operator, for the joint use or joint development of any property or rights of the transit operator or of the public agency, public utility, or person or entity for the establishment of through routes, joint fares, transfer of passengers, pooling rights, sales or leasing, or for any other purpose necessary for, incidental to, or convenient for, the full exercise of the powers granted to transit operators.
As used in this section, the following terms have the following meanings:
“Joint development” or “jointly develop” means the joint planning, financing, construction, operation, or use of any land, building, facility, or equipment other than vehicles, or interest therein, either of the transit operator or adjacent to, physically related to, or functionally related to transit facilities of the transit operator. Joint development may be for public, commercial, residential, or mixed uses.
“Transit operator” means an entity that qualifies as a claimant under Section 99203 and is eligible to receive allocations under this chapter, and includes a joint powers authority formed to operate a public transportation system.
The purpose of any joint development project entered into in accordance with this section shall be to foster transit use, enhance the transit service, or foster the integration of land use and transportation.
For purposes of this section, a transit operator is prohibited from engaging in agreements unrelated to the transportation purposes and mission of the transit operator.
Any transit oriented joint development project undertaken pursuant to this section shall comply with the land use and zoning regulations of the city, county, or city and county in which the project is located in accordance with the Planning and Zoning Law (Chapter 1 (commencing with Section 65000) of Division 1 of Title 7 of the Government Code) relating to zoning.
This section shall not supersede any existing authority of a transit operator for joint development.
CHAPTER 5. Motor Vehicle Fuel Tax [99500. - 99510.]
Except as specified in subdivision (b), in addition to taxes imposed pursuant to Part 2 (commencing with Section 7301), Part 3 (commencing with Section 8601), and Part 31 (commencing with Section 60001) of Division 2 of the Revenue and Taxation Code, a tax of one cent ($0.01) per gallon (or, in the case of compressed natural gas, per 100 cubic feet thereof as measured at standard pressure and temperature) may be imposed pursuant to Section 99502 by a taxing entity, as defined in Section 99501, in the area which is under its jurisdiction and which is included in a county that has approved a proposition pursuant to Section 4 of Article XIX of the California Constitution.
No tax shall be imposed under this chapter on fuel used in propelling an aircraft or a vessel.
For purposes of this chapter:
“Taxing entity” means a county other than a county with a transit development board or a county under the jurisdiction of a county transportation commission created pursuant to Division 12 (commencing with Section 130000), a city and county, a county transportation commission, a transit development board, a transit district, or a city with a population in excess of 500,000 located within a transit district. The population of a city shall be as determined by the last preceding federal census or by a subsequent census validated by the Demographic Research Unit of the Department of Finance.
“Transit vehicle” means a vehicle, including, but not limited to, one operated on rails or tracks, which is used for public transportation service and which carries more than 10 persons, including the driver.
The tax may be imposed by the adoption of an ordinance by a taxing entity if (1) it calls a special election for the submission of a proposition to grant it the authority to impose the tax pursuant to the ordinance and (2) two-thirds of the voters voting at the special election approves the proposition. The special election may be held only when consolidated with an otherwise scheduled state election or local election for an area that includes the area under the jurisdiction of the taxing entity. In the case of the City of Los Angeles, it may call the special election only after securing the approval of the Los Angeles County Metropolitan Transportation Authority.
Where two or more taxing entities have jurisdiction over the same area and are authorized pursuant to subdivision (a) to impose the tax under this chapter, the tax shall be imposed only by the taxing entity with the largest area under its jurisdiction.
A special election for a transit development board or a transit district shall be conducted pursuant to the Uniform District Election Law (Part 4 (commencing with Section 10500) of Division 10 of the Elections Code).
The taxing entity shall contract with the State Board of Equalization for the administration of the tax imposed pursuant to the adopted ordinance, and the state board shall be reimbursed for its cost in the administration of the tax.
The taxing entity shall also reimburse the board for its cost of preparation to administer the tax.
The ordinance shall include provisions identical to those contained in Part 2 (commencing with Section 7301), Part 3 (commencing with Section 8601), and Part 31 (commencing with Section 60001) of Division 2 of the Revenue and Taxation Code, except that the name of the taxing entity as the taxing agency shall be substituted for that of the state.
The State Board of Equalization shall adopt the necessary rules and regulations to administer the tax.
After deducting its cost in administering the tax, the State Board of Equalization shall transmit the net revenues to the taxing entity periodically as promptly as possible. The transmittals shall be made at least twice in each calendar quarter.
The net revenues received by a taxing entity shall be expended only for the following:
The planning, construction, and maintenance of, and the acquisition of rights-of-way for, exclusive public mass transit guideways and exclusive bus lanes and related fixed facilities to such guideways and bus lanes.
The purchase of transit vehicles.
The payment of principal and interest on voter-approved bonds issued for the purposes specified in subdivision (a) or (b).
Notwithstanding Section 99505, any person required to pay a license tax under Section 7351 of the Revenue and Taxation Code shall also collect the tax imposed under this chapter from any person to whom he sells or distributes motor vehicle fuel and shall pay such tax also for all such fuel that he uses.
Any person paying the tax who, in turn, sells or distributes such fuel to another, whether or not for use, shall include the tax as part of the selling price of the fuel. Any person thereafter who pays a price for the fuel, which includes an increment for the tax, and who subsequently resells the fuel shall include the increment so paid as part of the selling price of the fuel.
Subdivision (a) of this section shall become operative only if a ruling of a federal agency becomes effective which precludes the tax imposed under this chapter on motor vehicle fuel from being included in the price charged by distributors to retailers or other persons, or precludes the increment of any price paid to the distributors that represents the tax imposed from being included in the price charged by retailers or other persons upon resale of the motor vehicle fuel, and, in such case, this subdivision shall become operative at the same time as such ruling becomes effective.
Notwithstanding Section 99505, any person required to pay a tax under Sections 60051, 60052, and 60058 of the Revenue and Taxation Code shall also collect the tax imposed under this chapter from any person to whom he or she sells diesel fuel and shall also pay that tax for all diesel fuel that he or she uses.
Any person paying the tax who, in turn, sells diesel fuel to another, whether or not for use, shall include the tax as part of the selling price of the fuel. Any person thereafter who pays a price for the diesel fuel, which includes an increment for the tax, and who subsequently resells the diesel fuel shall include the tax paid as part of the selling price of the fuel.
CHAPTER 6. Actions and Proceedings to Contest Taxes [99550. - 99550.]
The decision of the California Supreme Court in Los Angeles County Transportation Agency v. Richmond (1982), 31 Cal. 3d 197, shall be applicable to and control, and the decision of the California Supreme Court in Rider v. County of San Diego (1991), 1 Cal. 4th 1, shall not be applicable to and shall not control, any action or proceeding wherein the validity of a retail transactions and use tax is contested, questioned, or denied if the ordinance imposing that tax was adopted by a transportation agency and approved prior to December 19, 1991, by a majority of the voters.
For purposes of this section, “transportation agency” means any agency, authority, district, commission, or other public entity organized under provisions of this code and authorized to impose a retail transactions and use tax.
CHAPTER 7. Transit Employer-Employee Relations [99560. - 99570.4.]
ARTICLE 1. General Provisions [99560. - 99560.3.]
The Legislature hereby finds and declares that:
The people of this state have a fundamental interest in the development of harmonious and cooperative labor relations between public transit districts and their employees.
Public transit districts are not subject to a common statewide statutory scheme or an administrative agency that has jurisdiction over the conduct of employer-employee relations.
Other public sector employees in the state have been granted the opportunity for collective bargaining through the adoption of the Meyers-Milias Brown Act (Chapter 10 (commencing with Section 3500) of Division 4 of Title 1 of the Government Code), the Ralph C. Dills Act (Chapter 10.3 (commencing with Section 3512) of Division 4 of Title 1 of the Government Code), the Educational Employment Relations Act (Chapter 10.7 (commencing with Section 3540) of Division 4 of Title 1 of the Government Code), and the Higher Education Employer-Employee Relations Act (Chapter 12 (commencing with Section 3560) of Division 4 of Title 1 of the Government Code), and it would be advantageous and desirable to expand the jurisdiction of the Public Employment Relations Board to cover the employees of public transit districts.
The people and the public transit district employers each have a fundamental interest in the preservation and promotion of the responsibilities granted by the people of this state. Harmonious relations between each public transit district employer and its employees are necessary to that endeavor.
It is the purpose of this chapter to provide the means by which relations between the Los Angeles County Metropolitan Transportation Authority and their supervisory employees may assure that the responsibilities and authorities granted to each transit district by statute are carried out in an atmosphere that permits the fullest participation by employees in the determination of conditions of employment which affect them. It is the intent of this chapter to accomplish this purpose by providing a uniform basis for recognizing the right of the employees of these transit districts to full freedom of association, self-organization, and designation of representatives of their own choosing for the purpose of representation in their employment relationships with their employers and to select one employee organization as their exclusive representative for the purpose of meeting and conferring.
It is the further purpose of this chapter to provide orderly and clearly defined procedures for meeting and conferring and the resolution of impasses, and to define and prohibit certain practices that are inimical to the public interest.
As used in this chapter, the following words have the following meanings:
“Arbitration” means a method of resolving a rights dispute under which the parties to a controversy must accept the award of a third party.
“Board” means the Public Employment Relations Board established pursuant to Section 3541 of the Education Code.
“Certified organization” means an employee organization that has been certified by the board as the exclusive representative of the public transit district employees in an appropriate unit after a proceeding under Article 5 (commencing with Section 99564).
“Confidential employee” means any employee who is required to develop or present management positions with respect to meeting and conferring or whose duties normally require access to confidential information that contributes significantly to the development of those management positions.
“Employee” or “transit district employee” means any supervisory employee of any public transit district employer except for confidential employees.
“Employee organization” means any organization of any kind in which public transit district employees participate and that exists for the purpose, in whole or in part, of dealing with public transit district employers concerning grievances, labor disputes, wages, hours, and other terms and conditions of employment of employees.
“Employee organization” shall also include any person that an employee organization authorizes to act on its behalf.
“Employer” or “transit district employer” means the governing board of a public transit district, including any person acting as an agent of an employer.
“Employer” or “transit district employer” shall also include the Public Transportation Services Corporation established by the Los Angeles County Metropolitan Transportation Authority, including any person acting as an agent of the employer.
“Employer” or “transit district employer” shall also include any organizational unit established pursuant to paragraph (2) of subdivision (a) of Section 130051.11, including any person acting as an agent of the employer.
“Employer” or “transit district employer” shall also include any transportation zone established pursuant to paragraph (8) of subdivision (a) of Section 130051.12, including any person acting as an agent of the employer.
“Employer representative” means any person or persons authorized to act on behalf of the employer.
“Exclusive representative” means any recognized or certified employee organization or person it authorizes to act on its behalf.
“Impasse” means that the parties have reached a point in meeting and conferring at which their differences in positions are such that further meetings would be futile.
“Managerial employee” means any employee having significant responsibilities for formulating or administering policies and programs of the public transit district.
“Meet and confer” means the performance of the mutual obligation of the public transit district employer and the exclusive representative of the public transit district employees to meet at reasonable times and to confer in good faith with respect to matters within the scope of representation and to endeavor to reach agreement on matters within the scope of representation. The process shall include adequate time for the resolution of impasses. If agreement is reached between representatives of the public transit district employer and the exclusive representative, they shall jointly prepare a written memorandum of the understanding, which shall be presented to the transit district employer for concurrence. However, these obligations shall not compel either party to agree to any proposal or require the making of a concession.
“Person” means one or more individuals, organizations, associations, corporations, boards, committees, commissions, agencies, or their representatives.
“Recognized organization” means an employee organization that has been recognized by an employer as the exclusive representative of the employees in an appropriate unit pursuant to Article 5 (commencing with Section 99564).
“Supervisory employee” means any employee of a public transit district, regardless of job description, having authority in the interest of the employer to hire, transfer, suspend, lay off, recall, promote, discharge, assign, reward, or discipline other employees, or the responsibility to assign work to and direct them, or to adjust their grievances, or effectively recommend such action if, in connection with these functions, the exercise of that authority is not of a merely routine or clerical nature, but requires the use of independent judgment.
This chapter shall be known and may be referred to as the Los Angeles County Metropolitan Transportation Authority Transit Employer-Employee Relations Act.
This chapter shall only apply to supervisory employees of the Los Angeles County Metropolitan Transportation Authority.
ARTICLE 2. Administration [99561. - 99561.4.]
This chapter shall be administered by the Public Employment Relations Board. In administering this chapter the board shall have all of the following rights, powers, duties, and responsibilities:
To determine in disputed cases, or otherwise approve, appropriate units.
To determine in disputed cases whether a particular item is within or without the scope of representation.
To arrange for, and supervise, representation elections that shall be conducted by means of secret ballot elections, and to certify the results of the elections.
To establish lists of persons broadly representative of the public and qualified by experience to be available to serve as mediators, arbitrators, or factfinders.
To establish by regulation appropriate procedures for review of proposals to change unit determinations.
To adopt, pursuant to Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code, rules and regulations to carry out the provisions and effectuate the purposes and policies of this chapter.
To hold hearings, subpoena witnesses, administer oaths, take the testimony or deposition of any person, and, in connection therewith, to issue subpoenas duces tecum to require the production and examination of any employer’s or employee organization’s records, books, or papers relating to any matter within its jurisdiction, except for those records, books, or papers confidential under statute. Notwithstanding Section 11425.10 of the Government Code, Chapter 4.5 (commencing with Section 11400) of Part 1 of Division 3 of Title 2 of the Government Code does not apply to a hearing by the board under this section, except a hearing to determine an unfair practice charge.
To investigate unfair practice charges or alleged violations of this chapter, and to take any action and make any determinations in respect of these charges or alleged violations as the board deems necessary to effectuate the policies of this chapter, except that in an action to recover damages due to an unlawful strike, the board shall have no authority to award strike-preparation expenses as damages, and shall have no authority to award damages for costs, expenses, or revenue losses incurred during, or as a consequence of, an unlawful strike.
To bring an action in a court of competent jurisdiction to enforce any of its orders, decisions, or rulings or to enforce the refusal to obey a subpoena. Upon issuance of a complaint charging that any person has engaged in or is engaging in an unfair practice, the board may petition the court for appropriate temporary relief or restraining order.
To delegate its powers to any member of the board or to any person appointed by the board for the performance of its functions, except that no fewer than two board members may participate in the determination of any ruling or decision on the merits of any dispute coming before it, and except that a decision to refuse to issue a complaint shall require the approval of two board members.
To decide contested matters involving recognition, certification, or decertification of employee organizations.
To consider and decide issues relating to rights, privileges, and duties of an employee organization in the event of a merger, amalgamation, or transfer of jurisdiction between two or more employee organizations.
To take any other action as the board deems necessary to discharge its powers and duties and otherwise to effectuate the purposes of this chapter.
Any person who shall willfully resist, prevent, impede, or interfere with any member of the board, or any of its agents, in the performance of duties pursuant to this chapter, shall be guilty of a misdemeanor, and, upon conviction thereof, shall be sentenced to pay a fine of not more than one thousand dollars ($1,000).
The initial determination as to whether the charges of unfair practices are justified, and, if so, what remedy is necessary to effectuate the purposes of this chapter, shall be a matter within the exclusive jurisdiction of the board. Procedures for investigating, hearing, and deciding these cases shall be devised and promulgated by the board.
Any employee, employee organization, or employer shall have the right to file an unfair practice charge, except that the board shall not issue a complaint in respect of any charge based upon an alleged unfair practice occurring more than six months prior to the filing of the charge.
The board shall not have authority to enforce agreements between the parties, and shall not issue a complaint on any charge based on alleged violation of such an agreement that would not also constitute an unfair practice under this chapter.
The board shall have the power to issue a decision and order directing an offending party to cease and desist from the unfair practice and to take affirmative action, that includes, but is not limited to, the reinstatement of employees with or without backpay, that will effectuate the policies of this chapter.
Notwithstanding any other law, if a decision by an administrative law judge regarding the recognition or certification of an employee organization as described in subdivision (k) of Section 99561 is appealed, the decision shall be deemed the final order of the board if the board does not issue a ruling that supersedes the decision on or before 180 days after the appeal is filed.
ARTICLE 3. Judicial Review [99562. - 99562.]
No employer or employee organization shall have the right to judicial review of a unit determination except: (1) when the board in response to a petition from an employer or employee organization agrees that the case is one of special importance and joins in the request for such review; or (2) when the issue is raised as a defense to an unfair practice complaint. A board order directing an election shall not be stayed pending judicial review.
Upon receipt of a board order joining in the request for judicial review, a party to the case may petition for a writ of extraordinary relief from the unit determination decision or order.
Any charging party, respondent, or intervenor aggrieved by a final decision or order of the board in an unfair practice case, except a decision of the board not to issue a complaint in the case, may petition for a writ of extraordinary relief from the decision or order.
The petition shall be filed in the district court of appeal in the appellate district where the unit determination or unfair practice dispute occurred. The petition shall be filed within 30 days after issuance of the board’s final order, order denying reconsideration, or order joining in the request for judicial review, as applicable. Upon the filing of the petition, the court shall cause notice to be served upon the board and thereafter shall have jurisdiction of the proceeding. The board shall file in the court the record of the proceeding, certified by the board, within 10 days after the clerk’s notice unless the filing period is extended by the court for good cause shown. The court shall have jurisdiction to grant to the board any temporary relief or restraining order it deems just and proper and in like manner to make and enter a decree enforcing, modifying, or setting aside the order of the board. The findings of the board with respect to questions of fact, including ultimate facts, if supported by substantial evidence on the record considered as a whole, are conclusive. The provisions of Title 1 (commencing with Section 1067) of Part 3 of the Code of Civil Procedure relating to writs shall, except where specifically superseded by this article, apply to proceedings pursuant to this section.
If the time to petition for extraordinary relief from a board decision has expired, the board may seek enforcement of any final decision or order in a district court of appeal or a superior court in the district where the unit determination or unfair practice case occurred. If, after hearing, the court determines that the order was issued pursuant to procedures established by the board and that the person or entity refuses to comply with the order, the court shall enforce the order by writ of mandamus. The court shall not review the merits of the order.
ARTICLE 4. Rights, Obligations, Prohibitions, and Unfair Labor Practices [99563. - 99563.8.]
Transit district employees shall have the right to form, join, and participate in the activities of employee organizations of their own choosing for the purpose of representation on all matters of employer-employee relations and for the purpose of meeting and conferring and shall have the right to engage in other concerted activities for the purpose of collective bargaining or other mutual aid or protection. Transit district employees shall also have the right to refuse to join employee organizations or to participate in the activities of these organizations subject to the organizational security provision permissible under this chapter.
Notwithstanding the provisions of the Government Code or other laws or statutes, the transit district employer shall make deductions from wages and salaries of its employees upon receipt of authorization for the payment of union dues, fees, or assessments, for the payment of contributions pursuant to any health and welfare plan or pension plan or any other purpose for which deductions may be authorized by employees where the deductions are pursuant to a collective bargaining agreement with a duly designated or certified labor organization.
Subject to reasonable regulations, employee organizations shall have the right of access at reasonable times to areas in which employees work, the right to use transit district bulletin boards, mailboxes and other means of communication, and the right to use transit district facilities at reasonable times for the purpose of meetings concerned with the exercise of the rights guaranteed by this chapter.
A reasonable number of representatives of an exclusive representative shall have the right to receive reasonable periods of released or reassigned time without loss of compensation when engaged in meeting and conferring and for the processing of grievances prior to the adoption of the initial memorandum of understanding. When a memorandum of understanding is in effect, released or reassigned time shall be in accordance with the memorandum.
Transit district employers, or the representatives as they may designate, shall engage in meeting and conferring with the employee organization selected as exclusive representative of an appropriate unit on all matters within the scope of representation.
The scope of representation shall include all matters relating to employment conditions and employer-employee relations, including, but not limited to, wages, hours, and other terms and conditions of employment.
Notwithstanding subdivision (a), the scope of representation shall not include consideration of the merits, necessity, or organization of any service or activity provided by law or executive order.
The duty to meet and confer in good faith requires the parties to begin negotiations prior to the adoption of the final budget for the ensuing year sufficiently in advance of the adoption date so there is adequate time for agreement to be reached, or for the resolution of impasse.
It shall be unlawful for the transit district employer to do any of the following:
Impose or threaten to impose reprisals on employees, to discriminate or threaten to discriminate against employees, or otherwise to interfere with, restrain, or coerce employees because of their exercise of rights guaranteed by this chapter. For purposes of this subdivision, “employee” includes an applicant for employment or reemployment.
Deny to employee organizations rights guaranteed to them by this chapter.
Refuse or fail to meet and confer with an exclusive representative.
Dominate or interfere with the formation or administration of any employee organization, or contribute financial or other support to it, or in any way encourage employees to join any organization in preference to another. However, subject to rules and regulations adopted by the board pursuant to Section 99561, an employer shall not be prohibited from permitting employees to engage in meeting and conferring or consulting during working hours without loss of pay or benefits.
Refuse to participate in good faith in the impasse procedure set forth in Article 9 (commencing with Section 99568).
It shall be unlawful for an employee organization to:
Cause or attempt to cause the transit district employer to violate Section 99563.7.
Impose or threaten to impose reprisals on employees, to discriminate or threaten to discriminate against employees, or otherwise to interfere with, restrain, or coerce employees because of their exercise of rights guaranteed by this chapter.
Refuse or fail to meet and confer with the transit district employer.
Refuse to participate in good faith in the impasse procedure set forth in Article 9 (commencing with Section 99568).
ARTICLE 5. Employee Organizations: Representation, Recognition, Certification, and Decertification [99564. - 99564.5.]
An employee organization may become the exclusive representative for the employees of an appropriate unit for purposes of meeting and conferring by filing a request with a transit district employer alleging that a majority of the employees in an appropriate unit wish to be represented by the organization and asking the employer to recognize it as the exclusive representative. The request shall describe the grouping of jobs or positions that constitute the unit claimed to be appropriate and shall certify that proof of majority support has been submitted to either the board or to a mutually agreed upon third party. Notice of any such request shall immediately be posted conspicuously on all employee bulletin boards in each facility of the employer in which members of the unit claimed to be appropriate are employed.
The transit district employer shall grant a request for recognition filed pursuant to Section 99564 except in one of the following circumstances:
The employer reasonably doubts that the employee organization has majority support or reasonably doubts the appropriateness of the requested unit. In that case the employer shall notify the board which shall conduct a representation election pursuant to Section 99564.4 unless subdivision (c) or (d) applies.
Another employee organization either files with the employer a challenge to the appropriateness of the unit or submits a competing claim of representation within 15 workdays of the posting of notice of the written request. If the claim is evidenced by the support that at least 30 percent of the members of the proposed unit, a question of representation shall be deemed to exist and the board shall conduct a representation election pursuant to Section 99564.4, or if the claim is evidenced by the support of at least 10 percent of the members of the proposed unit, the board shall conduct inquiries and investigations or hold hearings that it deems necessary in order to decide the questions raised by the claim and may conduct a representation election pursuant to Section 99564.4. Evidence of that support shall be submitted to either the board or to a mutually agreed upon third party.
There is currently in effect a lawful written memorandum of understanding between the employer and another employee organization recognized or certified as the exclusive representative of any employees included in the unit described in the request for recognition, unless the request for recognition is filed not more than 120 days and not less than 90 days prior to the expiration date of such memorandum of understanding. However, if a memorandum of understanding has been in effect for three years or more, there shall be no restriction as to the time of filing the request.
Within the previous 12 months either another employee organization has been lawfully recognized or certified as the exclusive representative of any employees included in the unit described in the request for recognition, or a majority of the votes cast in a representation election held pursuant to Section 99564.4 were cast for “no representation.”
A petition may be filed with the board, in accordance with its rules and regulations, requesting it to investigate and decide the question of whether employees have selected or wish to select an exclusive representative or to determine the appropriateness of a unit, by one of the following:
An employee organization alleging that it has filed a request for recognition as an exclusive representative with an employer and that the request has been denied or has not been acted upon within 30 days after the filing of the request.
An employee organization alleging that it has filed a competing claim of representation pursuant to subdivision (b) of Section 99564.1.
An employee organization wishing to be certified by the board as the exclusive representative. The petition for certification as the exclusive representative in an appropriate unit shall include proof of a 30-percent showing of interest designating the organization as the exclusive representative of the employees.
A petition may be filed with the board, in accordance with its rules and regulations, requesting it to investigate and decide the question of whether the employees wish to decertify an exclusive representative or to reconsider the appropriateness of a unit. The petition may allege that the employees in an appropriate unit no longer desire a particular employee organization as their exclusive representative. The petition shall include proof of a 30-percent showing of interest indicating support for another organization or lack of support for the incumbent exclusive representative.
Upon receipt of a petition filed pursuant to Section 99564.2, the board shall conduct inquiries and investigations or hold hearings as it deems necessary in order to decide the questions raised by the petition. The determination of the board may be based upon the evidence adduced in the inquiries, investigations, or hearings. If the board finds on the basis of the evidence that a question of representation exists, or a question of representation is deemed to exist pursuant to subdivision (a) or (b) of Section 99564.1, it shall order that an election shall be conducted by secret ballot placing on the ballot all employee organizations evidencing support of at least 10 percent of the members of an appropriate unit, and it shall certify the results of the election on the basis of which ballot choice received a majority of the valid votes cast. There shall be printed on the initial ballot the choice of “no representation.” If, at any election, no choice on the ballot receives a majority of the votes cast, a runoff election shall be conducted. The ballot for the runoff election shall provide for a selection between the two choices receiving the largest and second largest number of valid votes cast in the election.
No election shall be held and the petition shall be dismissed whenever either of the following exists:
There is currently in effect a memorandum of understanding between the employer and another employee organization recognized or certified as the exclusive representative of any employees included in the unit described in the petition, unless the petition is filed not more than 120 days and not less than 90 days prior to the expiration date of the memorandum. However, if the memorandum has been in effect for three years or more, there shall be no restriction as to time of filing the petition.
Within the previous 12 months either an employee organization other than the petitioner has been lawfully recognized or certified as the exclusive representative of any employees included in the unit described in the petition, or a majority of the votes cast in a representation election held pursuant to subdivision (a) were cast for “no representation.”
The employee organization recognized or certified as the exclusive representative shall represent all employees in the unit, fairly and impartially. A breach of this duty shall be deemed to have occurred if the employee organization’s conduct in representation is arbitrary, discriminatory, or in bad faith.
ARTICLE 6. Unit Determination [99565. - 99565.]
In each case where the appropriateness of a unit is an issue, in determining an appropriate unit, the board shall take into consideration all of the following criteria:
The internal and occupational community of interest among the employees, including, but not limited to, the extent to which they perform functionally related services or work toward established common goals, the history of employee representation with the employer, the extent to which the employees belong to the same employee organization, the extent to which the employees have common skills, working conditions, job duties, or similar educational or training requirements, and the extent to which the employees have common supervision.
The effect that the projected unit will have on the meet and confer relationships, emphasizing the availability and authority of employer representatives to deal effectively with employee organizations representing the unit, and taking into account factors such as work location, the numerical size of the unit, the relationship of the unit to organizational patterns of the transit district employer, and the effect on the existing classification structure or existing classification schematic of dividing a single class or single classification schematic among two or more units.
The effect of the proposed unit on efficient operations of the employer and the compatibility of the unit with the responsibility of the transit district employer and its employees to serve the public.
The number of employees and classifications in a proposed unit, and its effect on the operations of the employer, on the objectives of providing the employees the right to effective representation, and on the meet and confer relationship.
The impact on the meet and confer relationship created by fragmentation of employee groups or any proliferation of units among the employees of the employer.
The board shall not determine that any unit is appropriate if it includes, together with other employees, employees who are defined as peace officers pursuant to subdivisions (b) and (c) of Section 830.2 of the Penal Code.
ARTICLE 7. Organizational Security [99566. - 99566.3.]
Subject to the limitations set forth in this chapter, organizational security shall be within the scope of representation.
Notwithstanding any other provision of law, upon receiving notice from the exclusive representative of a transit district employee who is in a unit for which an exclusive representative has been selected pursuant to this chapter, the employer shall deduct the amount of the fair share service fee authorized by this section from the wages and salary of the employee and pay that amount to the employee organization. Thereafter, the employee shall, as a condition of continued employment, be required either to join the recognized employee organization or pay the fair share service fee. The amount of the fee shall not exceed the dues that are payable by members of the employee organization, and shall cover the cost of negotiation, contract administration, and other activities of the employee organization that are germane to its functions as the exclusive bargaining representative. Agency fee payers shall have the right, pursuant to regulations adopted by the board, to receive a rebate or fee reduction upon request, of that portion of their fee that is not devoted to the cost of negotiations, contract administration, and other activities of the employee organization that are germane to its function as the exclusive bargaining representative.
The costs covered by the fee under this section may include, but shall not necessarily be limited to, the cost of lobbying activities designed to foster collective bargaining negotiations and contract administration, or to secure for the represented employees advantages in wages, hours, and other conditions of employment in addition to those secured through meeting and negotiating with the employer.
The arrangement described in subdivision (a) shall remain in effect unless it is rescinded pursuant to subdivision (d). The employer shall remain neutral, and shall not participate in any election conducted under this section unless required to do so by the board.
The arrangement described in subdivision (a) may be rescinded by a majority vote of all the employees in the negotiating unit subject to that arrangement, if a request for a vote is supported by a petition containing the signatures of at least 30 percent of the employees in the negotiating unit, and the signatures are obtained in one year. There shall not be more than one vote taken during the term of any collective bargaining agreement.
If the arrangement described in subdivision (a) is rescinded pursuant to paragraph (1), a majority of all employees in the negotiating unit may request that the arrangement be reinstated. That request shall be submitted to the board along with a petition containing the signatures of at least 30 percent of the employees in the negotiating unit. The vote shall be conducted at the worksite by secret ballot, and shall be conducted no sooner than one year after the rescission of the arrangement under this subdivision.
If the board determines that the appropriate number of signatures have been collected, it shall conduct the vote to rescind or reinstate in a manner that it shall prescribe in accordance with this subdivision.
The cost of conducting an election under this subdivision to reinstate the organizational security arrangement shall be borne by the petitioning party and the cost of conducting an election to rescind the arrangement shall be borne by the board.
The recognized employee organization shall indemnify and hold the transit district employer harmless against any reasonable legal fees, legal costs, and settlement or judgment liability arising from any court or administrative action relating to the transit district’s compliance with this section. The recognized employee organization shall have the exclusive right to determine whether any such action or proceeding shall or shall not be compromised, resisted, defended, tried, or appealed. This indemnification and hold harmless duty shall not apply to actions related to compliance with this section brought by the exclusive representative of transit district employees against the transit district employer.
The employer of a transit district employee shall provide the exclusive representative of an employee with the home address of each member of a bargaining unit, regardless of when that employee commences employment, so that the exclusive representative can comply with the notification requirements set forth by the United States Supreme Court in Chicago Teachers Union v. Hudson (1986) 475 U.S. 292.
Notwithstanding subdivision (i) of Section 99560.1, Section 99566, or any other provision of this chapter, any employee who is a member of a religious body whose traditional tenets or teachings include objections to joining or financially supporting employee organizations shall not be required to join, maintain membership in, or financially support any employee organization as a condition of employment except as provided in subdivision (b).
The employee may be required, in lieu of a service fee, to pay sums equal to the service fee either to a nonreligious, nonlabor organization, charitable fund exempt from taxation under Section 501(c)(3) of Title 26 of the Internal Revenue Code, chosen by the employee from a list of at least three such funds, designated in the organizational security arrangement, or if the arrangement fails to designate funds, then to any such fund chosen by the employee. Either the employee organization or the transit district employer may require that proof of the payments be made on an annual basis to the transit district employer as a condition of continued exemption from the requirement of financial support to the recognized employee organization. If the employee who holds conscientious objections pursuant to this section requests the employee organization to use the grievance procedure or arbitration procedure on the employee’s behalf, the employee organization is authorized to charge the employee for the reasonable cost of using that procedure.
Every recognized or certified employee organization shall keep an adequate itemized record of its financial transactions and shall make available annually, to the board and to the employees who are members of the organization, within 60 days after the end of its fiscal year, a detailed written financial report of its financial transactions in the form of a balance sheet and an operating statement, signed and certified as to accuracy by its president and treasurer, or corresponding principal officers. In the event of noncompliance with this section, any employee within the organization may petition the board for an order compelling compliance, or the board may issue a compliance order on its motion.
ARTICLE 8. Rights-Disputes Arbitration [99567. - 99567.]
An employer and an exclusive representative who enter into a written memorandum of understanding may agree to procedures for final and binding arbitration of disputes that may arise under the memorandum of understanding or between the parties.
Where a party to a memorandum of understanding is aggrieved by the failure, neglect, or refusal of the other party to proceed to arbitration pursuant to the procedures provided in the memorandum, the aggrieved party may bring proceedings pursuant to Title 9 (commencing with Section 1280) of Part 3 of the Code of Civil Procedure for a court order directing that the arbitration proceed pursuant to the procedures provided in the memorandum of understanding.
An arbitration award made pursuant to this section shall be final and binding upon the parties and may be enforced by a court pursuant to Title 9 (commencing with Section 1280) of Part 3 of the Code of Civil Procedure.
The board shall submit a list of names of arbitrators to employers and employee organizations upon their mutual request. Nothing in this subdivision shall preclude the parties from mutually agreeing to some other means of selecting an arbitrator. The board shall also, if mutually requested to do so, designate an arbitrator to hear and decide the rights dispute.
ARTICLE 9. Impasse Procedures [99568. - 99568.]
The impasse procedures contained in Chapter 9 (commencing with Section 1137) of Part 3 of Division 2 of the Labor Code shall govern any impasse proceedings under this chapter.
ARTICLE 10. Public Notice [99569. - 99569.]
All initial proposals of exclusive representatives and of transit district employers, that relate to matters within the scope of representation, shall be presented at a public meeting of the transit district employer and thereafter shall be public records.
Meeting and conferring shall not commence on an initial proposal until a reasonable time has elapsed after the submission of the proposal to enable the public to become informed and the public has the opportunity to express itself regarding the proposal at a meeting of the transit district employer.
After the public has had the opportunity to express itself, the transit district employer shall, at a meeting that is open to the public, adopt a proposal, including any changes to its initial proposal that the transit district employer deems appropriate based on the public’s comments.
New subjects of meeting and conferring arising after the presentation of initial proposals shall be made public within 24 hours. If a vote is taken on a new subject by the transit district employer, the vote on the subject by each member voting shall also be made public within 24 hours.
The board may adopt regulations for the purpose of implementing this section, which are consistent with the intent of the section, that the public be informed of the issues that are being met and conferred upon and have full opportunity to express their views on the issues to the transit district employer, and to know of the positions of the transit district employer.
ARTICLE 11. Miscellaneous [99570. - 99570.4.]
The following proceedings set forth in this section are exempt from the Ralph M. Brown Act (Chapter 9 (commencing with Section 54950) of Part 1 of Division 2 of Title 5 of the Government Code), unless the parties mutually agree otherwise:
Any meeting and conferring discussion between a transit district employer and a recognized or certified employee organization.
Any meeting of a mediator with either party or both parties to the meeting and conferring process.
Any hearing, meeting, or investigation conducted by a factfinder or arbitrator.
Any executive session of the transit district employer or between the transit district employer and its designated representatives for the purpose of discussing its position respecting meeting and conferring or regarding any matter within the scope of representation or instructing its designated representatives.
No memorandum of understanding shall contravene any federal or state law, including rules and regulations promulgated pursuant to such laws, prohibiting discrimination in employment.
If any provision of this chapter or the application of such provision to any person or circumstance shall be held invalid, the remainder of this chapter, or the application of such provision to persons or circumstances other than those as to which it is held invalid shall not be affected thereby.
Nothing in this chapter shall be construed to deprive employees of their rights pursuant to the Urban Mass Transportation Act of 1964 (49 U.S.C. Section 5301 et seq.) and the agreements entered into pursuant to Section 5333(b) of Title 49 of that act.
CHAPTER 8. Administrative Enforcement for Fare Evasion and Prohibited Conducts [99580. - 99582.]
Pursuant to subdivision (e) of Section 640 of the Penal Code, a public transportation agency may enact and enforce an ordinance to impose and enforce an administrative penalty for any of the acts described in subdivision (b).
Evasion of the payment of a fare of the system.
Misuse of a transfer, pass, ticket, or token with the intent to evade the payment of a fare.
Playing unreasonably loud sound equipment on or in a system facility or vehicle, or failing to comply with the warning of a transit official related to disturbing another person by loud or unreasonable noise.
Smoking a tobacco product, eating, or drinking in or on a system facility or vehicle in those areas where those activities are prohibited by that system.
Expectorating upon a system facility or vehicle.
Willfully disturbing others on or in a system facility or vehicle by engaging in boisterous or unruly behavior.
Carrying an explosive or acid, flammable liquid, or toxic or hazardous material in a system facility or vehicle.
Urinating or defecating in a system facility or vehicle, except in a lavatory. However, this paragraph shall not apply to a person who cannot comply with this paragraph as a result of a disability, age, or a medical condition.
Willfully blocking the free movement of another person in a system facility or vehicle.
This paragraph shall not be interpreted to affect any lawful activities permitted or First Amendment rights protected under the laws of this state or applicable federal law, including, but not limited to, laws related to collective bargaining, labor relations, or labor disputes.
Skateboarding, roller skating, bicycle riding, or roller blading in a system facility, including a parking structure, or in a system vehicle. This paragraph does not apply to an activity that is necessary for utilization of a system facility by a bicyclist, including, but not limited to, an activity that is necessary for parking a bicycle or transporting a bicycle aboard a system vehicle, if that activity is conducted with the permission of the agency of the system in a manner that does not interfere with the safety of the bicyclist or other patrons of the system facility.
Unauthorized use of a discount ticket or failure to present, upon request from a system representative, acceptable proof of eligibility to use a discount ticket, in accordance with Section 99155, and posted system identification policies when entering or exiting a system station or vehicle. Acceptable proof of eligibility must be clearly defined in the posting.
If an eligible discount ticket user is not in possession of acceptable proof at the time of request, an issued notice of fare evasion or passenger conduct violation shall be held for a period of 72 hours to allow the user to produce acceptable proof. If the proof is provided, that notice shall be voided. If the proof is not produced within that time period, that notice shall be processed.
Selling or peddling any goods, merchandise, property, or services of any kind whatsoever on the facilities, vehicles, or property of the public transportation system without the express written consent of the public transportation system or its duly authorized representatives.
Failing to yield seating reserved for an elderly or disabled person.
The agency issuing the notice of fare evasion or passenger conduct violation and the notice of delinquent fare evasion or passenger conduct violation.
The party responsible for processing the notice of fare evasion or passenger conduct violation and the notice of delinquent violation, if a contract is entered into pursuant to paragraph (1).
In setting the amounts of administrative penalties for the violations listed in subdivision (b), the public transportation agency shall not establish penalty amounts that exceed one hundred twenty-five dollars ($125) upon a first or second violation and two hundred dollars ($200) upon a third or subsequent violation.
The issuing agency shall allow payment of the fare evasion or passenger conduct penalty or penalties in installments or deferred payment if the total amount of the fines is two hundred dollars ($200) or more and the person provides satisfactory evidence of an inability to pay the penalty or penalties in full.
Except as provided in paragraph (2), the issuing agency shall permit the performance of community service in lieu of payment of the fare evasion or passenger conduct penalty if the person is under 18 years of age or if the person provides satisfactory evidence of an inability to pay the fare evasion or passenger conduct penalty in full. The issuing agency may require the performance of community service at transit facilities, as defined in subdivision (f) of Section 640 of the Penal Code.
The issuing agency is not required to permit the performance of community service in lieu of payment for a fare evasion or passenger conduct penalty if the person has had more than three fare evasion or passenger conduct penalties for which he or she was permitted to perform community service pursuant to paragraph (1), and did not complete any community service, provided that the person was offered a community service placement and was given adequate time to comply with the community service requirement.
A person who receives a notice of fare evasion or passenger conduct violation pursuant to this section shall not be subject to citation for a violation of Section 640 of the Penal Code.
If an entity enacts an ordinance pursuant to this section it shall, both two years and five years after enactment of the ordinance, report all of the following information to the Senate Committee on Transportation and Housing and the Assembly Committee on Transportation:
A description of the ordinance, including the circumstances under which an alleged violator is afforded the opportunity to complete the administrative process.
The amount of the administrative penalties.
The number and types of citations administered pursuant to the ordinance.
To the extent available, a comparison of the number and types of citations administered pursuant to the ordinance with the number and types of citations issued for similar offenses and administered through the courts both in the two years prior to the ordinance and, if any, since enactment of the ordinance.
A discussion of the effect of the ordinance on passenger behavior.
A discussion of the effect of the ordinance on revenues to the entity described in subdivision (a) and, in consultation with the superior courts, the cost savings to the county courts. The superior courts are encouraged to collaborate on and provide data for this report.
For purposes of this section, “smoking” has the same meaning as in subdivision (c) of Section 22950.5 of the Business and Professions Code.
For purposes of this section, “tobacco product” means a product or device as defined in subdivision (d) of Section 22950.5 of the Business and Professions Code.
A transit district’s ordinance may be enforced outside of the transit district’s jurisdiction only where the local jurisdiction has adopted the transit district’s ordinance by reference as authorized by the local jurisdictions’ governing body.
For a period of 21 calendar days from the issuance to a person of the notice of fare evasion or passenger conduct violation, the person may request an initial review of the violation by the issuing agency. The request may be made by telephone, in writing, or in person. There shall be no charge for this review. If, following the initial review, the issuing agency is satisfied that the violation did not occur or that extenuating circumstances make dismissal of the administrative penalty appropriate in the interest of justice, the issuing agency shall cancel the notice. The issuing agency shall advise the processing agency, if any, of the cancellation. The issuing agency or the processing agency shall mail the results of the initial review to the person contesting the notice and if following that review, cancellation of the notice does not occur, the agency shall include a reason for that denial, notification of the ability to request an administrative hearing, and notice of the procedure adopted pursuant to subdivision (b) for waiving prepayment of the penalty based upon inability to pay.
If the person is dissatisfied with the results of the initial review, the person may request an administrative hearing of the violation no later than 21 calendar days following the mailing of the results of the issuing agency’s initial review. The request may be made by telephone, in writing, or in person. The person requesting an administrative hearing shall deposit with the processing agency the amount due under the notice for which the administrative hearing is requested. The issuing agency shall adopt a written procedure to allow a person to request an administrative hearing without payment of the amount due upon satisfactory proof of an inability to pay the amount due. An administrative hearing shall be held within 90 calendar days following the receipt of a request for an administrative hearing, excluding time tolled pursuant to this chapter. The person requesting the hearing may request one continuance, not to exceed 21 calendar days.
The administrative hearing process shall include all of the following:
The person requesting a hearing shall have the choice of a hearing by mail or in person. An in-person hearing shall be conducted within the jurisdiction of the issuing agency. If an issuing agency contracts with a private vendor pursuant to paragraph (1) of subdivision (c) of Section 99580, hearings shall be held within the jurisdiction of the issuing agency.
The administrative hearing shall be conducted in accordance with written procedures established by the issuing agency and approved by the governing body or chief executive officer of the issuing agency. The hearing shall provide an independent, objective, fair, and impartial review of contested violations.
The administrative review shall be conducted before a hearing officer designated to conduct the review by the issuing agency’s governing body or chief executive officer. In addition to any other requirements of employment, a hearing officer shall demonstrate those qualifications, training, and objectivity prescribed by the issuing agency’s governing body or chief executive as are necessary and which are consistent with the duties and responsibilities set forth in this chapter. The hearing officer’s continued employment, performance evaluation, compensation, and benefits shall not be directly or indirectly linked to the amount of fare evasion or passenger conduct violation penalties imposed by the hearing officer.
The person who issued the notice of fare evasion or passenger conduct violation shall not be required to participate in an administrative hearing. The issuing agency shall not be required to produce any evidence other than the notice of fare evasion or passenger conduct violation. The documentation in proper form shall be prima facie evidence of the violation pursuant to paragraph (1) of subdivision (d) of Section 99580.
The hearing officer’s decision following the administrative hearing may be personally delivered to the person by the hearing officer or sent by first-class mail.
Following a determination by the hearing officer that a person committed the violation, the hearing officer may, and consistent with subdivision (f) of Section 99580, shall, allow payment of the fare evasion or passenger conduct penalty in installments or deferred payment if the person provides satisfactory evidence of an inability to pay the fare evasion or passenger conduct penalty in full. The hearing officer may, and consistent with subdivision (g) of Section 99580, shall, permit the performance of community service in lieu of payment of the fare evasion or passenger conduct penalty.
Within 30 calendar days after the mailing or personal delivery of the decision described in subdivision (c) of Section 99581, the person may seek review by filing an appeal to be heard by the superior court where the same shall be heard de novo, except that the contents of the processing agency’s file in the case shall be received in evidence. A copy of the notice of fare evasion or passenger conduct violation shall be admitted into evidence as prima facie evidence of the facts stated therein establishing a rebuttable presumption affecting the burden of producing evidence. A copy of the notice of appeal shall be served in person or by first-class mail upon the processing agency by the person filing the appeal. For purposes of computing the 30-calendar-day period, Section 1013 of the Code of Civil Procedure shall be applicable. A proceeding under this subdivision is a limited civil case.
Notwithstanding any other provision of law, the fee for filing the notice of appeal shall be as provided in Section 70615 of the Government Code. The court shall request that the processing agency’s file on the case be forwarded to the court, to be received within 15 calendar days of the request. The court shall notify the appellant of the appearance date by mail or personal delivery. The court shall retain the fee regardless of the outcome of the appeal. If the court finds in favor of the appellant, the amount of the filing fee shall be reimbursed to the appellant by the processing agency. Any deposit of fare evasion or passenger conduct penalty shall be refunded by the processing agency in accordance with the judgment of the court.
The conduct of the appeal under this section is a subordinate judicial duty that may be performed by a commissioner and other subordinate judicial officers at the direction of the presiding judge of the court.
If a notice of appeal of the processing agency’s decision described in subdivision (c) of Section 99581 is not filed within the period set forth in subdivision (a), that decision shall be deemed final.
PART 11.5. CLEAN AIR AND TRANSPORTATION IMPROVEMENT ACT OF 1990 [99600. - 99696.]
CHAPTER 1. General Provisions [99600. - 99605.]
This part shall be known as the Clean Air and Transportation Improvement Act of 1990.
The people of California find and declare all of the following:
Rail transportation results in cleaner air, less energy use, more transportation opportunities for those who cannot drive, and less crowding on already overcrowded streets and highways.
For these reasons, it is appropriate to use state general obligation bonds to finance rail infrastructure.
This part will result in implementation of part of an overall transportation plan which will provide cleaner air and better transportation options for all Californians.
For purposes of this part, the following terms have the following meanings, unless expressly stated otherwise:
“CalTrain” means the commuter rail service operated along the San Francisco Peninsula commute corridor.
“Commission” means the California Transportation Commission.
“Commuter rail service” and its derivative terms have the same meaning as the term “commuter service” and its derivative terms, as defined in paragraph (9) of subsection (a) of Section 502 of Title 45 of the United States Code.
“Department” means the Department of Transportation.
“Exclusive public mass transit guideway” means a transit capital improvement included in the definition of this term as applied and used in 70 Op. Atty. Gen. 119 or a transit capital improvement for which motor vehicle fuel tax funds from the State Highway Account in the State Transportation Fund were actually allocated by the commission on or before January 1, 1989.
“Fund” means the Clean Air and Transportation Improvement Fund created by Section 99610.
“Grade separations” means grade separations for either passenger or freight rail services.
“Intercity rail” and its derivative terms means passenger rail service between urban areas of the state.
“Local agency” means a county, city, city and county, county transportation commission, county transportation authority, transit development board, transit district, or any joint powers agency specified in this part.
“Rail project” means a commuter passenger rail service project, an intercity passenger rail project, or a rail transit project, and includes exclusive public mass transit guideway projects and the project described in Section 99624.
“Rail transit” means a rail mass transportation operation usually within an urban area, generally characterized by more frequent service over shorter distances than normally provided by commuter rail service or intercity rail service, and operating on a rail line without any or with very limited rail freight service.
“Right-of-way” means right-of-way for rail purposes, including separate right-of-way alignments adjacent to existing freight lines.
The department shall establish an advisory committee to assist the department in developing specifications for standard state-of-the-art California commuter and intercity rail cars and locomotives. The committee shall consist of representatives from all affected local transportation agencies as well as the department’s Division of Mass Transportation and one consumer representative.
The purpose of the standard equipment is to facilitate joint procurement in economic quantities, to further interchangeability of equipment among corridors, and to reduce maintenance costs by minimizing the need for spare parts inventories.
To the extent possible, the committee shall rely on the department’s existing work in procuring new equipment for CalTrain.
The committee shall investigate the feasibility of a uniform design of a rail car shell which could be deployed in both intercity and commuter rail applications, with car interiors to be appropriately outfitted for either intercity or commuter service.
The committee shall consider two types of coach service, dining or cafe car service, or both, and economical sleeping car service for intercity applications.
The committee shall consider inclusion of sanitary holding tanks and reasonable passenger amenities including, but not limited to, accommodations for a reasonable number of bicycles carried on board by passengers, for both intercity and commuter applications.
Intercity equipment specifications shall not be adopted unless approved by the National Railroad Passenger Corporation.
Except as otherwise provided in this part, the Legislature may amend this part, by statute passed in each house of the Legislature by rollcall vote entered in the journal, four-fifths of the membership concurring, if the statute is consistent with, and furthers the purposes of, this part. No changes shall be made in the way in which funds are allocated pursuant to Chapter 3 (commencing with Section 99620), except pursuant to Section 99684.
CHAPTER 2. The Clean Air and Transportation Improvement Fund [99610. - 99614.]
The Clean Air and Transportation Improvement Fund is hereby created.
It is the intent of the people of California, in enacting this part, that bond funds shall not be used to displace existing sources of funds for rail and other forms of public transportation, including, but not limited to, funds that have been provided pursuant to Article XIX of the California Constitution, the Transportation Planning and Development Account in the State Transportation Fund, the Mills-Alquist-Deddeh Act (Chapter 4 (commencing with Section 99200) of Part 11), and local transportation sales taxes; that any future comprehensive transportation funding legislation shall not offset or reduce the amounts otherwise made available for transit purposes by this act; and that funding for public transit should be increased from existing sources including fuel taxes and sales tax on fuels.
Notwithstanding Section 13340 of the Government Code, all money deposited in the fund is hereby continuously appropriated to the commission, without regard to fiscal years, for allocation for grants to itself, the department, the Department of Parks and Recreation, and to local agencies pursuant to Chapter 3 (commencing with Section 99620).
The commission shall allocate money from the fund in accordance with the allocations specified in Chapter 3 (commencing with Section 99620) to the department, to the Department of Parks and Recreation, and to local agencies as grants for expenditure for the preservation, acquisition, construction, or improvement of any of the following:
Rights-of-way for rail purposes.
Rail terminals and stations.
Rolling stock, including locomotives, passenger cars, and related rail equipment and facilities.
Grade separations and other improvements along rail rights-of-way for rail purposes.
Rail maintenance facilities.
Other capital facilities deemed necessary for a specified rail service, including soundwalls.
Capital expenditures for the purposes specified in subdivision (b) of Section 1 of Article XIX of the California Constitution.
Paratransit vehicles, bicycle facilities, and water-borne ferry vessels and facilities.
The project described in Section 99648.
The commission shall require each applicant for a grant pursuant to Chapter 3 (commencing with Section 99620), including the department, to demonstrate in its application that if the grant funds being applied for are awarded, no other funds which were previously planned, programmed, or approved for rail purposes will be used for other than rail purposes.
Consistent with Section 99665, money from the fund may be used to satisfy any federal, state or local matching fund requirement for the project to be funded. Money from the fund may be used to provide local matching funds for grade separations pursuant to subdivision (c) of Section 1202 or Section 1202.5.
Authorized expenditures listed in paragraphs (1) to (7), inclusive, of subdivision (a) are “rail projects” as defined in subdivision (j) of Section 99602.
Grant funds shall be expended only for capital expenditures.
Projects to be funded shall include, to the greatest extent possible, projects which integrate and facilitate transfers between rail lines, including all rail lines for which funding is provided by this part.
Notwithstanding Section 13440 of the Government Code, the amounts required to be paid pursuant to subdivision (a) are hereby continuously appropriated from the General Fund.
The appropriations for interest payments pursuant to subdivision (b) are appropriations for debt service, as defined in Section 8 of Article XIII B of the California Constitution, and are therefore exempt from the appropriations limit set by that article.
CHAPTER 3. Grants [99620. - 99655.]
This chapter sets forth the purposes and the amounts for which allocations shall be made from the fund. Money from the fund shall be awarded as grants by the commission pursuant to Sections 99622 to 99651, inclusive, for the purposes specified in those sections. The amount of a grant awarded pursuant to any of those sections shall not exceed the amount specified therein. The department and local agencies may implement service funded pursuant to this chapter on an incremental basis. Partial grants may be made for preliminary engineering and design purposes.
Two hundred thirty million dollars ($230,000,000) shall be allocated to the department for all of the following:
Improvements to the Los Angeles-Fresno-San Francisco Bay Area passenger rail corridor and extension of the corridor to Sacramento, one hundred forty million dollars ($140,000,000), including at least sixty million dollars ($60,000,000) for rail rehabilitation and other rail improvements to provide intercity rail service between Fresno and Oakland via Madera, Merced, Turlock, and Modesto, and not more than thirty million dollars ($30,000,000) for rehabilitation and other rail improvements to provide intercity rail service between Stockton and Sacramento via Lodi and Galt.
Preliminary engineering and feasibility studies of a high speed passenger rail link between Bakersfield and Los Angeles, five million dollars ($5,000,000).
Implementation of intercity rail service from Placer County to Santa Clara County, eighty five million dollars ($85,000,000), of which not more than thirty five million dollars ($35,000,000) shall be for commuter rail service between Auburn and Davis, including funding for right-of-way acquisition. Service to Woodland may also be provided, if deemed practicable by the department.
Eighty one million dollars ($81,000,000) shall be allocated to the department for intercity and commuter rail projects along the Los Angeles-Santa Barbara rail corridor to be allocated for expenditure as follows:
In Ventura County, thirty one million dollars ($31,000,000).
In Santa Barbara County, seventeen million dollars ($17,000,000).
In Los Angeles County, thirty three million dollars ($33,000,000).
The funds allocated for expenditure in Los Angeles and Ventura Counties may be expended in coordination with a joint powers agency required to be established for commuter rail service pursuant to Section 130255 within that segment of the corridor.
Eighty million dollars ($80,000,000) to the department for grade separations along the Alameda-San Pedro branch rail line connecting the Los Angeles and Long Beach Harbors with downtown Los Angeles and paralleling Alameda Street, to alleviate vehicle traffic congestion, conserve energy, reduce air pollution in the area, and facilitate the more efficient and expeditious shipment of freight to and from the Los Angeles and Long Beach Harbors. The current owner of the Alameda-San Pedro branch line may, at its option, continue to own and operate the line and related right-of-way.
The allocation and granting of funds pursuant to this Section shall be exempt from Sections 99653 and 99663. The allocation and granting of funds pursuant to this section shall also be exempt from subdivision (c) of Section 1202, and Sections 1202.5 and 99317.8 of the Public Utilities Code, and Sections 2450 to 2461, inclusive, of the Streets and Highways Code if the affected railroad corporation contributes ten (10) percent of the costs of constructing the grade separations funded pursuant to this section. Notwithstanding any provision of this code or the Streets and Highways Code, no city on the Alameda-San Pedro branch line shall be assessed costs for the grade separations. The department is the sole state agency responsible for designing, determining priorities, and implementing the construction of those grade separations. The department shall coordinate its planning with any joint powers agency established to represent affected cities, local agencies, or commissions. The department shall further coordinate and cooperate with any such joint powers agency so that the expenditure of any federal, local, and private funds including those for tracks, switching, and interconnection improvements, and the possible construction of a proposed Alameda Street truck corridor is accomplished in an efficient and well-planned manner.
For the purposes of the California Environmental Quality Act (Division 13 (commencing with Section 21000) of the Public Resources Code), grade separations funded pursuant to this section and all related track and switching improvements and rail interconnections shall be considered to be one project.
Six million dollars ($6,000,000) shall be allocated to the department for the improvement of rail service, including rail freight service and tourist-related services, important to the regional economy of Humboldt County.
The commission shall not approve a grant for purposes of this section unless the Board of Supervisors of the County of Humboldt makes a finding that the project proposed for funding is in the public interest and vital to the economy of the county and the commission determines that the proposed project will serve a public purpose.
Notwithstanding subdivisions (a) and (b), the grant authorized by this section may be used by the Humboldt County Association of Governments, at its request, for any of the purposes specified in Section 99628.
Four million dollars ($4,000,000) shall be allocated to the department for the improvement of rail service, including rail freight service and tourist-related services, important to the regional economy of Mendocino County.
The commission shall not approve a grant for purposes of this section unless the Board of Supervisors of the County of Mendocino makes a finding that the project proposed for funding is in the public interest and vital to the economy of the county and the commission determines that the proposed project will serve a public purpose.
Notwithstanding subdivisions (a) and (b), the grant authorized by this section may be used by the Mendocino Council of Governments, at its request, for any of the purposes specified in Section 99628.
If the Legislature establishes a railroad transportation authority which includes, or which is subsequently expanded to include, within its jurisdiction, Humboldt County or Mendocino County, or both of them, the authority shall be substituted for the department and affected councils of government as the applicant and the grantee agency for purposes of Sections 99625 and 99626.
If the authority includes, or is expanded to include, within its jurisdiction, Del Norte County, the authority shall be substituted for the county as the applicant and grantee agency for purposes of Section 99628.
Seventy three million dollars ($73,000,000) for allocation by the commission on a per capita basis to the Counties of Alpine, Amador, Butte, Calaveras, Colusa, Del Norte, El Dorado, Glenn, Imperial, Inyo, Lake, Lassen, Mariposa, Modoc, Mono, Napa, Nevada, Plumas, San Benito, San Luis Obispo, Shasta, Sierra, Siskiyou, Sutter, Tehama, Trinity, Tuolumne, and Yuba, for railroad grade crossing improvements, acquisition of railroad rights-of-way for rail transportation purposes, rail passenger or other rail stations, railroad soundwalls, and other local rail improvements for safety; purchase of paratransit vehicles; and other capital facilities for public transportation. Funds may not be allocated for street or highway improvements, operations, maintenance, or construction.
Application for grants shall be submitted to the commission by the transportation planning agency having jurisdiction in the county.
If the commission has not received applications by December 31, 1992, for all of the funds available for allocation pursuant to this section, it may reallocate the remaining funds on the basis of a competitive grants program to the counties specified in subdivision (a). The commission shall adopt regulations or guidelines governing the competitive program allocations to proposals which best serve the purposes of this part.
Funds allocated pursuant to this section and Section 99639 may be pooled by any combination of the recipient counties and used with private funds to acquire existing railroad rights-of-ways for passenger and freight rail projects, or for other rail projects.
Two hundred two million dollars ($202,000,000) shall be allocated to the Los Angeles-San Diego Rail Corridor Agency for intercity and commuter rail projects for expenditure as follows:
In San Diego County, forty five million dollars ($45,000,000).
In Orange County, eighty two million dollars ($82,000,000).
In Los Angeles County, seventy five million dollars ($75,000,000).
Two hundred twenty nine million dollars ($229,000,000) shall be allocated to the Los Angeles County Transportation Commission, for expenditure on rail projects within Los Angeles County as follows:
Not less than eighty million dollars ($80,000,000) thereof shall be allocated for Metro Rail.
Not less than eighty million dollars ($80,000,000) thereof shall be allocated for rail projects other than Metro Rail within Los Angeles County.
Seventy nine million dollars ($79,000,000) shall be allocated to the joint powers agency required to be established pursuant to Section 130255, for the San Bernardino-Riverside-Orange County rail corridor, for expenditure for commuter rail projects as follows:
In Riverside County, forty seven million dollars ($47,000,000).
In Orange County, twenty seven million dollars ($27,000,000).
In San Bernardino County, five million dollars ($5,000,000).
If full or partial funding for the project in Riverside County becomes available from other sources, application may be made by the Riverside County Transportation Commission to use the portion of the grant not needed for the project for other rail projects in the county.
If full or partial funding for the project in San Bernardino County becomes available from other sources, application may be made by the San Bernardino County Transportation Commission to use the portion of the grant not needed for the project for other rail projects in the county.
If full or partial funding for the project in Orange County becomes available from other sources, application may be made by the Orange County Transportation Commission to use the portion of the grant not needed for the project for other rail projects in the county.
Ninety eight million dollars ($98,000,000) shall be allocated to the joint powers agency required to be established pursuant to Section 130255, for the San Bernardino-Los Angeles rail corridor, for expenditure for commuter rail projects as follows:
In Los Angeles County, forty two million dollars ($42,000,000).
In San Bernardino County, fifty six million dollars ($56,000,000).
If full or partial funding for the project in Los Angeles County becomes available from other sources, the Los Angeles County Transportation Commission may make application to use the portion of the grant not needed for the project for other rail projects in the county.
If full or partial funding for the project in San Bernardino County becomes available from other sources, application may be made by the San Bernardino County Transportation Commission to use the portion of the grant not needed for the project for other rail projects in the county.
Sixty-one million dollars ($61,000,000) shall be allocated to the Alameda County Transportation Commission for expenditure on rail projects of the San Francisco Bay Area Rapid Transit District and other rail projects within Alameda County, as determined by the authority. Projects funded pursuant to this section shall be consistent with the new rail starts and extensions plan of the Metropolitan Transportation Commission.
Thirty seven million dollars ($37,000,000) shall be allocated to the Contra Costa Transportation Authority for expenditure on rail projects of the San Francisco Bay Area Rapid Transit District and other rail projects within Contra Costa County, as determined by the authority. Projects funded pursuant to this section shall be consistent with the new rail starts and extensions plan of the Metropolitan Transportation Commission.
Thirty five million dollars ($35,000,000) shall be allocated to the Public Utilities Commission of the City and County of San Francisco, for expenditure for rail projects within the City and County of San Francisco.
One hundred seventy three million dollars ($173,000,000) shall be allocated to the Peninsula Corridor Study Joint Powers Board for CalTrain capital improvements and acquisition of rights-of-way, as follows:
In the City and County of San Francisco, thirteen million dollars ($13,000,000).
In San Mateo County, nineteen million dollars ($19,000,000).
In Santa Clara County, twenty one million dollars ($21,000,000), to be allocated for expenditure as follows:
Existing service from San Jose, seventeen million dollars ($17,000,000).
Extension of service south of San Jose to the county line, four million dollars ($4,000,000).
Acquisition of rights-of-way, one hundred twenty million dollars ($120,000,000).
Ten million dollars ($10,000,000) shall be allocated to the San Mateo County Transit District for expenditure for extensions of the San Francisco Bay Area Rapid Transit District within San Mateo County.
Seventeen million dollars ($17,000,000) shall be allocated to the Monterey County Transportation Commission for the following:
Extension of CalTrain service.
Other rail projects within Monterey County.
Twenty eight million dollars ($28,000,000) shall be allocated to a joint powers agency responsible for expenditure for a rail project along the Santa Rosa to Larkspur rail corridor.
Notwithstanding subdivision (a), eleven million dollars ($11,000,000) of the grant authorized by this section may be allocated to the Board of Supervisors of the County of Marin, and seventeen million dollars ($17,000,000) may be allocated to the Board of Supervisors of the County of Sonoma, for expenditure on the rail project described in subdivision (a) or for any of the purposes specified in Section 99628, if both boards concur.
Eleven million dollars ($11,000,000) shall be allocated to the Santa Cruz County Transportation Commission for the following:
Intercity passenger rail projects connecting the City of Santa Cruz with the Watsonville Junction.
Other rail projects within Santa Cruz County which facilitate recreational, commuter, intercity and intercounty travel.
Forty seven million dollars ($47,000,000) shall be allocated to the Santa Clara County Transit District, for expenditure for rail projects within Santa Clara County.
Seventy seven million dollars ($77,000,000) shall be allocated on a per capita basis to the San Diego Metropolitan Transit Development Board and the North San Diego County Transit Development Board for expenditure for rail projects within San Diego County.
One hundred million dollars ($100,000,000) shall be allocated to the Sacramento Regional Transit District for rail transit projects.
Fourteen million dollars ($14,000,000) shall be allocated to the San Joaquin Council of Governments for expenditure for rail projects along the Stockton-Manteca-Tracy corridor to the Alameda County line, including three hundred thousand dollars ($300,000) for a preliminary engineering and economic study of passenger rail service along the Stockton-Livermore (Altamont) corridor. Projects funded pursuant to this section shall be consistent with a locally adopted regional transportation plan.
One hundred twenty five million dollars ($125,000,000) shall be allocated to the City of Irvine for construction of a guideway demonstration project.
Ten million dollars ($10,000,000) shall be allocated to the City of Vallejo for expenditure on water-borne ferry vessels and terminal improvements.
Seven million dollars ($7,000,000) shall be allocated to the City of South Lake Tahoe for expenditure on acquisition of rights-of way, construction of an intermodal station, and related facilities for an exclusive public mass transit guideway project.
Five million dollars ($5,000,000) to the Department of Parks and Recreation for construction of the California State Museum of Railroad Technology. These funds shall be provided to the Department of Parks and Recreation when sufficient funding for the entire project is available.
One hundred million dollars ($100,000,000) shall be allocated by the commission to fund a competitive program for the acquisition of both commuter and intercity rail cars and locomotives designed pursuant to Section 99603. Local agencies and the department may apply for these funds, which shall be allocated to the department for a joint purchase. No matching funds shall be required for this competitive program. A local agency may contract with the department for purchase of additional rail equipment funded with other funds available to the local agency, including funds made available by this chapter. No funds made available by the commission pursuant to this chapter shall be used to purchase intercity or commuter rail cars or locomotives other than the standard equipment designed pursuant to Section 99603.
The department shall estimate the need for commuter and intercity rail cars and locomotives to be ordered pursuant to this section and establish a delivery schedule based on the needs of the operators of rail service. Orders for rail cars and locomotives shall include options as deemed necessary by the department to ensure that equipment is delivered when needed and to permit additional future orders.
The department may purchase rail cars and locomotives by competitive bid or competitive negotiation, and may negotiate sale-lease back provisions if determined to be advantageous. Proceeds from sale-lease back shall be used to acquire additional rail cars and equipment.
Twenty million dollars ($20,000,000) shall be allocated to fund a program of competitive grants to local agencies for capital outlay for bicycle improvement projects which improve safety and convenience for bicycle commuters.
Grants for the establishment of separate bicycle paths and ways shall be awarded only if the department determines that the route established will be principally used by bicycle commuters.
Twenty million dollars ($20,000,000) shall be allocated to fund a program of competitive grants to local agencies for the construction, improvement, acquisition, and other capital expenditures associated with water-borne ferry operations for the transportation of passengers or vehicles, or both.
Not more than ten million dollars ($10,000,000) may be allocated for the administration of this part by the commission to pay its expenses and the expenses of the department in administering this part. The commission may contract with the department for technical review services needed to review grant applications pursuant to this section. The commission shall not reduce the amount of a grant authorized by this chapter to defray the costs of analyzing grant applications or any other costs associated with its administration of this part.
In any case in which funds are granted or allocated for expenditure within specified counties or regions in or along a rail corridor, the grantee agency, including the department may, by resolution, and with the approval of the commission and of all the agencies which program capital improvements for transportation purposes along the affected part of the corridor, reallocate the funds for expenditure elsewhere along the corridor. For the purposes of this section, a corridor is a route used to provide passenger rail service.
Any agency or combination of agencies which is the successor to an agency having any rights, powers, duties, or obligations under this part, including eligibility to apply for, award, receive, and expend a grant, shall fully succeed to those rights, powers, duties, and obligations.
As of June 30, 2007, fourteen million five hundred sixty-three thousand dollars ($14,563,000) allocated for the improvement of the Los Angeles-Fresno-San Francisco Bay Area passenger rail corridor in Section 99622 remains unexpended, and one million dollars ($1,000,000) allocated for rail right-of-way studies in former Section 99621 remains unexpended. Pursuant to subdivision (c) of Section 99684, the unexpended funds cited in this section are hereby reallocated to the department and shall be made available for expenditure by the High-Speed Rail Authority for the state-sponsored high-speed rail project.
CHAPTER 4. Applications for Grants [99660. - 99669.]
The commission shall adopt guidelines, as necessary, to require that grants for transit projects be expended for projects which are essential to the implementation of safe and reliable transit services. The guidelines shall include criteria for the awarding of grants for new or rehabilitated rail construction for passenger rail projects, specifying a maximum cost per mile for service for various regions of the state.
The purpose of this section is to facilitate implementation of improved cost-effective transit service to the maximum number of Californians and to prevent the funds provided for by this part from being spent on needlessly costly features.
The department, the Department of Parks and Recreation, or a local agency responsible for a project which is eligible for a grant pursuant to Chapter 3 (commencing with Section 99620) may apply to the commission for a grant for that project. Each application shall identify the specific section of Chapter 3 which authorizes the grant applied for. If a project is proposed to be funded by grants authorized by more than one section, the application shall identify each of the applicable sections and shall specify the amount applied for under each of those sections.
Two or more applicant agencies may join in applying for a grant for a project in which each of the agencies will participate.
In accordance with regulations and guidelines of the commission, each application shall be accompanied by a plan describing how the grant funds will be used, what other capital funds are available for the project, and how those funds will be used. The plan shall include a plan for operating any new service, including a financial plan for operation.
The plan shall also identify the sources of the remainder of the funds required for construction and operation of any new service.
The application shall demonstrate that a reasonable share of the cost of any new or rehabilitated passenger rail service, as determined by the commission, will be covered by farebox revenue.
The commission, with the assistance of the department, shall commence its review of an application for a grant within 30 days of receipt of the application.
The application shall either be approved or denied by the commission within 180 days of its receipt, except that, if the commission requests additional information from the applicant, the time for approving or denying the application shall be calculated from the date that the commission receives the additional information requested.
If the commission denies an application, it shall state the specific reasons for that denial and may, in its discretion, permit the application to be amended to remove those grounds for denial. The commission shall have 180 days from the receipt of an amended application to either approve or deny the amended application.
The commission shall not deny any application which meets the requirements of this part and which conforms to the regulations and guidelines of the commission for the award of grants, nor shall the commission unreasonably delay the approval of an application which substantially conforms to those requirements if the applicant agrees to allow the commission to modify the application to meet its conditions for approval.
To be eligible for a grant for a rail transit project pursuant to Section 99630, subdivision (b), (c), or (d) of Section 99631, subdivision (b) or (c) of Section 99632, Section 99633, 99634, 99635, 99637, subdivision (b) of Section 99638, Section 99639, subdivision (b) of Section 99640, Section 99641, 99642, 99643, 99644, or 99645, an applicant agency shall match on a dollar-for-dollar basis, the amount of the grant from other public or private sources and shall demonstrate, to the satisfaction of the commission, the availability of those other funds.
Local agencies shall not adopt new or increased development taxes, fees, or exactions or permit fees for the purpose of providing matching funds for any grant specified in subdivision (a) or to pay for operating costs of new service established by a grant made pursuant to this part.
Bridge toll revenues otherwise available to a local agency may be used as a source of matching funds.
The eligibility of an applicant agency for a grant pursuant to a section of Chapter 3 (commencing with Section 99620) does not make it ineligible to apply for and receive a grant pursuant to any other provision of that chapter.
Each application for a grant to fund a segment of a commuter rail project shall demonstrate that the project is coordinated with all other planned and existing connecting commuter and intercity services, to maximize their efficiency and service to the people in the region.
If practicable, a joint maintenance facility shall be developed for commuter and other rail equipment at a central location in Southern California.
In order to maximize efficiency and avoid duplication of effort, a single joint powers agency may be established to implement and operate all commuter rail services in Southern California.
An application for rail transit extension shall include a plan for integrating bus service with the rail line and for avoiding duplicative and competing bus service. The commission shall submit the application to a peer review committee of at least three persons which shall evaluate the adequacy of the local agency’s transit integration plan. The peer review committee shall be appointed by the commission from persons recommended by the department and shall include representatives of transit operators. The local agency shall either implement recommendations of the peer review committee or indicate why the recommendations are not being implemented. The commission shall review the adequacy of the transit integration plan before approving the rail transit extension.
CHAPTER 5. Conditions [99680. - 99686.]
Funds allocated pursuant to this part shall not be used for any of the following:
A rail project connecting San Bernardino County and the State of Nevada.
Any alteration to the Golden Gate Bridge.
Passenger rail facilities which would not be available to the general public or whose primary purpose would be to benefit a private entity or individual.
Funds shall not be allocated for a project requiring service over the right-of-way of a railroad corporation unless a course of improvements and operation is agreed to by the railroad corporation or unless the right-of-way, or all or part of use of the right-of-way, is acquired by eminent domain or purchase. New or increased passenger service over the right-of-way of a railroad corporation shall be implemented in a manner which ensures the adequacy and efficiency of existing freight service. Neither the specific amounts allocated pursuant to Chapter 3 (commencing with Section 99620), nor any other provision of this part, are intended to indicate the actual fair market value of any railroad right-of-way to be acquired or leased.
All passenger rail and water borne ferry equipment and facilities acquired or constructed pursuant to this part and intended for public use shall be accessible to persons with physical disabilities, including wheelchair users. All passenger vehicles and vessels shall be accessible to wheelchair users at all stops, stations and terminals whether or not staffed.
All passenger vehicles and vessels acquired pursuant to this part shall provide reasonable access to bicycles. All stations acquired or constructed pursuant to this part shall provide convenient and secure bicycle parking facilities.
All funds allocated to an agency pursuant to this part shall be programmed, encumbered, obligated, or spent prior to July 1, 2000, unless economically infeasible. If funds allocated to an agency pursuant to this part are not expended or encumbered prior to July 1, 2000, the Legislature may, by a statute passed in each house by a two-thirds vote, reallocate those funds for another rail project within that agency’s jurisdiction.
If any of the funds are not expended or encumbered prior to July 1, 2010, the Legislature may, in the same manner, reallocate the funds for any other passenger rail project in the state.
In the case of funds allocated to the department, the reallocation shall be for a state-sponsored passenger rail project.
The Legislature may, by statute passed in each house by majority vote, or in the annual Budget Bill, require the commission to award any grant specified in Chapter 3 (commencing with Section 99620) which the commission has denied.
Funds allocated pursuant to this part that are not expended or encumbered by July 1, 2020, are hereby reallocated pursuant to subdivision (b) of Section 99684 to any other existing passenger rail project with existing rail service.
The California Transportation Commission shall select the projects for the reallocation described in subdivision (a). The high-speed rail project as described in Chapter 20 (commencing with Section 2704) of Division 3 of the Streets and Highways Code is not eligible to receive reallocated funds pursuant to subdivision (a) as it is not providing existing rail service.
If, within one year after the commission has denied any grant specified in Chapter 3 (commencing with Section 99620), the Legislature does not require the commission to award the grant pursuant to Section 99684, the Governor may direct the commission to award the grant if the Governor finds that the applicant for the grant is in substantial compliance with the requirements of this part.
Every expenditure made pursuant to this part shall be made in compliance with the California Environmental Quality Act (Division 13 (commencing with Section 21000) of the Public Resources Code).
CHAPTER 6. Bonds [99690. - 99696.]
This chapter shall be known and may be cited as the Clean Air and Transportation Improvement Bond Act of 1990.
Bonds in the total amount of one billion nine hundred ninety million dollars ($1,990,000,000), exclusive of refunding bonds, or so much thereof as is necessary, may be issued and sold to be used for carrying out the purposes expressed in this part and to be used to reimburse the General Obligation Bond Expense Revolving Fund pursuant to Section 16724.5 of the Government Code. The bonds, when sold, shall be and constitute a valid and binding obligation of the State of California, and the full faith and credit of the State of California is hereby pledged for the punctual payment of both principal and interest as they become due and payable.
The proceeds of bonds and notes issued and sold pursuant to this chapter shall be deposited in the Clean Air and Transportation Improvement Fund created by Section 99610.
The bonds authorized by this chapter shall be prepared, executed, issued, sold, paid, and redeemed as provided in the State General Obligation Bond Law (Chapter 4 (commencing with Section 16720) of Part 3 of Division 4 of Title 2 of the Government Code), and all provisions of that law shall apply to the bonds and are hereby incorporated in this chapter as though set forth in full in this chapter.
Solely for the purpose of authorizing the issuance and sale, pursuant to the State General Obligation Bond Law, of the bonds authorized by this chapter, the Transportation Improvement Finance Committee is hereby created. For purposes of this chapter, the Transportation Improvement Finance Committee is “the committee” as that term is used in the State General Obligation Bond Law. The committee shall consist of the Controller, the Director of Finance, and the Treasurer, or their designated representatives. The Treasurer shall serve as chairperson of the committee. A majority of the committee may act for the committee.
For purposes of this chapter, the commission is hereby designated as “the board.”
The committee shall determine whether or not it is necessary or desirable to issue bonds authorized pursuant to this chapter in order to carry out this part, and, if so, the amount of bonds to be issued and sold. Successive issues of bonds may be authorized and sold to carry out those purposes progressively, and it is not necessary that all of the bonds authorized to be issued be sold at any one time.
There shall be collected annually in the same manner and at the same time as other state revenue is collected, in addition to the ordinary revenues of the state, a sum in an amount required to pay the principal of, and interest on, the bonds each year. It is the duty of all officers charged by law with any duty in regard to the collection of the revenue to do and perform each and every act which is necessary to collect that additional sum.
Notwithstanding Section 13340 of the Government Code, there is hereby appropriated from the General Fund, for the purposes of this part, an amount that will equal the total of the following:
The sum annually necessary to pay the principal of, and interest on, bonds issued and sold pursuant to this chapter, as the principal and interest become due and payable.
The sum which is necessary to carry out Section 99694, appropriated without regard to fiscal years.
For the purposes of carrying out this part, the Director of Finance may authorize the withdrawal from the General Fund of an amount or amounts not to exceed the amount of unsold bonds which have been authorized by the committee to be sold for the purpose of carrying out those provisions. Any amounts withdrawn shall be deposited in the fund. Any money made available under this section shall be returned to the General Fund from money received from the sale of bonds which would otherwise be deposited in the fund.
Notwithstanding any other provision of this bond act, or of the State General Obligation Bond Law (Chapter 4 (commencing with Section 16720) of Part 3 of Division 4 of Title 2 of the Government Code), if the Treasurer sells bonds pursuant to this bond act that include a bond counsel opinion to the effect that the interest on the bonds is excluded from gross income for federal tax purposes under designated conditions, the Treasurer may maintain separate accounts for the bond proceeds invested and the investment earnings on those proceeds, and may use or direct the use of those proceeds or earnings to pay any rebate, penalty, or other payment required under federal law, or take any other action with respect to the investment and use of those bond proceeds, as may be required or desirable under federal law in order to maintain the tax-exempt status of those bonds and to obtain any other advantage under federal law on behalf of the funds of this state.
The board may request the Pooled Money Investment Board to make a loan from the Pooled Money Investment Account in the General Fund, in accordance with Section 16312 of the Government Code, to carry out this part. The amount of the loan shall not exceed the amount of the unsold bonds which the committee has, by resolution, authorized to be sold for the purposes of this chapter. The board shall execute any documents as required by the Pooled Money Investment Board to obtain and repay the loan. Any amounts loaned shall be deposited in the fund to be allocated in accordance with this chapter.
All money derived from premium and accrued interest on bonds sold shall be reserved and shall be available for transfer to the General Fund as a credit to expenditures for bond interest.
Any bonds issued or sold pursuant to this chapter may be refunded by the issuance of refunding bonds in accordance with Article 6 (commencing with Section 16780) of Chapter 4 of Part 3 of Division 4 of Title 2 of the Government Code. Approval by the electors of the state for the issuance of the bonds shall include approval of the issuance of any bonds issued to refund any bonds originally issued or any previously issued refunding bonds.
The people of California hereby find and declare that, inasmuch as the proceeds from the sale of bonds authorized by this part are not “proceeds of taxes” as that term is used in Article XIII B of the California Constitution, the disbursement of these proceeds is not subject to the limitation imposed by that article.
PART 12. SANTA CLARA VALLEY TRANSPORTATION AUTHORITY [100000. - 100619.]
CHAPTER 1. Title of Act and Policy [100000. - 100002.]
This part shall be known and may be cited as the “Santa Clara Valley Transportation Authority Act.”
It is necessary that a transit district be established in the County of Santa Clara in order to meet the public transit problems of that county. Because there is no general law under which such a district could be formed, the adoption of a special act and the formation of a special district is required.
The Legislature hereby finds and declares:
Since the formation of the Santa Clara Valley Transportation Authority, unprecedented growth has occurred in the San Francisco Bay area and in Santa Clara County in particular. It has become apparent that additional measures are required in order to deal more effectively with the resultant serious traffic congestion and to foster the development of trade and the movement of people in and around the Santa Clara Valley and throughout the entire bay area.
Transit and other modes of transportation are inextricably intertwined, and improvement and maintenance of the road and highway structure in conjunction and coordination with transit improvements are essential to optimize the ability of the Santa Clara Valley Transportation Authority to deal more effectively with serious traffic congestion.
The Santa Clara Valley Transportation Authority, having been designated as the Congestion Management Agency for Santa Clara County, and already authorized to construct and improve state and local highways pursuant to Section 100115.5, is uniquely positioned to implement programs to achieve the goal of a balanced approach to solving transportation problems.
This goal is best achieved in Santa Clara County by vesting in the Santa Clara Valley Transportation Authority the ability to plan, design, construct, maintain, and repair road and highway improvements, as well as bicycle, pedestrian, and other transportation facilities, under the conditions set forth in this part.
The Santa Clara County Transit District is renamed the Santa Clara Valley Transportation Authority. Any reference in this part, or in any other provision of law or regulation, to the Santa Clara County Transit District shall be deemed to refer to the Santa Clara Valley Transportation Authority. Nothing in the act that added this section alters, impairs, or terminates the district’s status as a transit district, and as an ongoing legal entity, or any of its legal obligations.
CHAPTER 2. Definitions [100010. - 100022.]
Unless the context otherwise requires, the provisions of this chapter govern the construction of this part.
“VTA” means the Santa Clara Valley Transportation Authority.
“Transit” means the transportation of passengers and their incidental baggage by any means, and includes rapid transit.
“Transit works” or “transit facilities” means any or all real and personal property, equipment, rights, or interests owned or to be acquired by the VTA for transit service or purposes.
“Board of directors” and “board” means the board of directors of the VTA.
“Director” means a member of the board of directors of the VTA.
“County” means the County of Santa Clara.
“Public agency” includes the State of California, and any county, city and county, city, district, or other political subdivision or public entity of, or organized under the laws of, this state, or any department, instrumentality or agency thereof.
“System” means all transit works and transit facilities owned or held or to be owned or held by the VTA for transit purposes.
“Revenues” means all rates, fares, tolls, rentals, or other income and revenue actually received or receivable by or for the account of the VTA from the operation of the system, including, without limiting the generality of the foregoing, interest allowed on any moneys or securities and any profits derived from the sale of any securities and any consideration in any way derived from any properties owned, operated, or at any time maintained by the VTA.
“Person” includes any individual, firm, copartnership, association, corporation, trust, limited liability company, business trust or receiver or trustee or conservator for any thereof, but does not include a public agency, as defined in this chapter.
“Establish” includes establish, construct, complete, acquire, extend, or reroute. It does not, however, include the maintenance and operation of any existing system acquired by the VTA.
“Existing system” means any transit service or system of a publicly or privately owned public utility or division thereof operating entirely within Santa Clara County or at least 40 percent of whose revenue vehicle miles for the preceding calendar year were operated within the district but does not include a charter-party carrier or the charter service of a passenger stage corporation.
“Transportation works” or “transportation facilities” means any or all real and personal property, rights, or interests owned or to be acquired by the VTA to facilitate the passage of vehicles or pedestrians exclusive of transit works and transit facilities.
CHAPTER 3. Formation of District [100030. - 100031.]
ARTICLE 1. General Provisions [100030. - 100031.]
The Legislature recognizes the formation of the Santa Clara Valley Transportation Authority and it may exercise the powers herein granted.
The boundaries of the VTA shall include all incorporated and unincorporated territory lying within the County of Santa Clara.
CHAPTER 3.5. Existing Systems [100055. - 100055.4.]
Notwithstanding any other provision of this act, before the VTA may establish any transit service or system that may at any time divert, lessen, or compete for the patronage or revenues of any existing system, the VTA shall give a written notice to the public utility that is operating the existing system. The written notice shall describe the transit service or system which the VTA proposes to establish and shall state the time that the VTA proposes to establish that service or system.
The VTA shall not establish the proposed service or system, or maintain and operate the service or system until it has completed the purchase of the existing system or any part thereof.
Subject to Section 100351, the purchase price to be paid for the existing system, or any portion thereof to be purchased, shall be the reproduction cost new, including going concern value, at the date upon which the VTA commences negotiations for the purchase of the existing system, or the portion of the existing system, less depreciation, including wear, tear, and obsolescence, if any.
The VTA and public utility operating the existing system may agree upon the purchase price or they may agree that the purchase price is to be established by arbitration and upon the method of naming arbitrators and the method of conducting such arbitration.
Section 851 does not apply to any contract for sale or sale of an existing system, or any portion thereof, pursuant to this chapter, and the Public Utilities Commission has no jurisdiction with respect thereto.
CHAPTER 4. Government of VTA [100060. - 100100.]
ARTICLE 1. Board of Directors [100060. - 100063.]
The government of the VTA shall be vested in a board of directors which shall consist of 12 members, as follows:
Two representatives of the county and one alternate who shall be members of the board of supervisors of the county, appointed by the board of supervisors.
Five representatives of the City of San Jose and one alternate who shall be city council members or the mayor of the City of San Jose, appointed by the city council.
Five city council members or mayors selected from among the city councils and mayors of all of the cities in the county, other than the City of San Jose, as provided by agreements among those cities. The agreements may provide for the appointment of alternates, who shall be city council members or mayors, for those city representatives.
An alternate may vote in the place of a director represented by that alternate if the director is absent.
To the extent possible, the appointing powers shall appoint individuals who have expertise, experience, or knowledge relative to transportation issues.
Except as otherwise provided, the term of office for each director shall be two years and until the appointment and qualification of his or her successor. A successor shall be appointed not later than 30 days immediately upon the expiration of a director’s term. A vacancy exists whenever a director ceases to hold office on the city council or board of supervisors from which he or she was appointed. Any vacancy shall, within 60 days of its occurrence, be filled for the balance of the term by the body that made the original appointment.
The board of directors shall annually elect a chairperson who shall preside at all meetings. The board of directors shall also annually elect a vice chairperson, who, in the event of the chairperson’s absence or inability to act, shall act as chairperson, and, while so acting, shall have all of the power and obligations of the chairperson.
The board shall establish rules for its proceedings. A majority of the members of the board shall constitute a quorum for the transaction of business and no act of the board shall be valid unless at least seven concur therein. The acts of the board shall be expressed by motion, resolution, or ordinance. All meetings of the board shall be conducted in the manner prescribed by the Ralph M. Brown Act, Chapter 9 (commencing with Section 54950), Part 1, Division 2, Title 5 of the Government Code.
No ordinance, except an urgency ordinance, shall be passed by the board on the day of its introduction, nor within three days thereafter, nor at any time other than at a regular or adjourned regular meeting. The enacting clause of all ordinances shall be as follows:
“The Board of Directors of the Santa Clara Valley Transportation Authority ordains as follows:”
All ordinances shall be signed by the chairperson of the board or the vice chairperson and attested by the secretary. Before the expiration of 15 days after the passage of an ordinance, it shall be published once in a newspaper of general circulation within the boundaries of the VTA as provided by law for ordinances adopted by counties. An order entered in the minutes of the board that the ordinance has been duly published is prima facie proof of publication.
Urgency ordinances shall be adopted in the same manner as provided by law for the adoption of urgency ordinances by counties.
The board may fix the amount of compensation to be paid each member of the board for services and for each meeting attended by the member. The compensation shall not exceed one hundred dollars ($100) for each meeting of the board attended by the member or for each day’s service rendered as a member by request of the board, not exceeding a total of six days in any calendar month, together with any expenses incident thereto.
ARTICLE 2. Powers and Duties of Board of Directors [100070. - 100071.]
The board of directors is the legislative body of the VTA and shall determine all questions of VTA policy.
It shall be the duty of the board of directors and it shall have the power to:
Determine the transit facilities to be acquired and constructed by the VTA, the manner of operation, and the means to finance them.
Adopt an annual budget for the VTA that provides for the compensation of its officers and employees.
Fix rates, rentals, charges, and classifications of transit service operated by the VTA.
Adopt an administrative code that prescribes the powers and duties of VTA officers, the method of appointment of VTA employees, and the methods, procedures, and systems for the operation and management of the VTA.
Adopt rules and regulations governing the use of transit facilities owned or operated by the VTA.
Cause a postaudit of the financial transactions and records of the VTA to be made at least annually by a certified public accountant or public accountant.
Adopt reasonable rules and regulations providing for the administration of employer-employee relations.
Do any and all things necessary to carry out the purposes of this part.
ARTICLE 3. Advisory Commission [100080. - 100082.]
The board of directors shall establish at least one advisory committee.
The advisory committees shall provide advice to the board of directors on matters of VTA policy and shall have additional duties as provided by the board of directors.
ARTICLE 4. Officers [100090. - 100091.]
The officers of the VTA shall consist of the members of the board of directors, the chairperson and vice chairperson of the board, a secretary, a general manager, a general counsel, and any other officers that the board deems necessary and provides for by ordinance or resolution. The general manager and general counsel shall be appointed and may be removed by the affirmative votes of a majority of the board.
The secretary and those assistants that the board designates may administer all oaths or affirmations required by law, including the oath of office.
ARTICLE 5. General Manager [100100. - 100100.]
The power and duties of the general manager are all of the following:
To head the administrative branch of the VTA and to be responsible to the board of directors for the proper administration of all affairs of the VTA.
To appoint, supervise, suspend, or remove VTA officers other than the members of the board and officers appointed by the board.
To supervise and direct the preparation of the annual budget for the board and be responsible for its administration after its adoption.
To formulate and present to the board plans for transit and other transportation facilities within the boundaries of the VTA and the means to finance them.
To supervise the planning, acquisition, construction, maintenance, and operation of the transit facilities of the VTA and other transportation facilities within the boundaries of the VTA, as needed.
To attend all meetings of the board.
To prepare and submit to the board as soon as practicable after the end of each fiscal year a complete report of the finances and administrative activities of the VTA for the preceding year.
To perform other and additional duties as the board may require.
CHAPTER 5. Powers and Functions of VTA [100110. - 100256.]
ARTICLE 1. Corporate Power [100110. - 100115.5.]
The VTA has perpetual succession and may adopt a seal and alter it at its pleasure.
The VTA may sue and be sued, except as otherwise provided by law, in all actions and proceedings, in all courts and tribunals of competent jurisdiction.
All claims for money or damages against the VTA are governed by Division 3.6 (commencing with Section 810) of Title 1 of the Government Code except as provided therein, or by other statutes or regulations expressly applicable thereto.
The VTA shall not levy any tax pursuant to Section 100250 unless approved by the electors voting on the measure in accordance with Article XIII C of the California Constitution at a special election called for that purpose by the board of directors.
Whenever a bond election is held to authorize incurring bonded indebtedness pursuant to Section 100400, the ordinance calling the election shall include a statement of the tax or taxes to be levied or continued to be levied and used, to the extent those taxes are required to pay principal of and interest on the bonds as the same become due, to provide any sinking fund payments required therefor, or to create or maintain any reserve fund required therefor. A vote in favor of the issuance of the bonds shall authorize the board to levy and collect such taxes. The ordinance levying the taxes shall not be repealed until all bonds payable from the revenues derived from the taxes have been fully paid or provision has been made for their payment in full.
Except as otherwise provided in this part, VTA elections shall be called, held, and conducted as provided by the Uniform District Election Law.
The VTA may exercise any and all powers granted by any other law that, by its terms, is applicable to transit districts generally, to public agencies generally, or to any classification of districts or public agencies that includes an entity of the type provided for in this part, but the VTA shall not exercise any power contrary to an express provision of this part.
The VTA may administer and implement any adopted countywide transportation expenditure plan funded in an amount greater than 50 percent from revenues derived from a retail transaction and use tax, if so designated in the plan or if the VTA and the entity that imposes the tax have entered into an agreement that so provides. The VTA may exercise those powers necessary to carry out this purpose.
The VTA may do any and all things necessary to ensure the completion of any projects established in a plan as set forth in subdivision (a). These projects may include, but are not limited to, all of the following:
The construction and improvement of state highways.
The construction, maintenance, and improvement of local roads, streets, and county highways.
The construction, improvement, and operation of public transit systems, including paratransit services.
The construction and improvement of bicycle and other transportation facilities.
The VTA shall consult with and coordinate any actions for administering and implementing a plan as set forth in subdivision (a) with the cities in the county, the board of supervisors, and the Department of Transportation.
Nothing in this section shall vary the terms of the cooperative agreement dated July 1, 1999, between the VTA and the County of Santa Clara for the construction of transportation projects utilizing local transaction and use tax revenues derived from Santa Clara County general tax Measure B approved by the voters in November 1996. If any of the provisions of this section conflict with the provisions of that cooperative agreement, the provisions of the cooperative agreement shall take precedence.
ARTICLE 2. Contracts [100120. - 100126.]
The VTA may make contracts and enter into stipulations of any nature whatsoever, either in connection with eminent domain proceedings or otherwise, including, without limiting the generality of the foregoing, contracts and stipulations to indemnify and save harmless, to employ labor, and to do all acts necessary and convenient for the full exercise of the powers granted in this part.
The VTA may contract with any department or agency of the United States of America, with any public agency or with any person upon terms and conditions as the board finds is for the best interest of the VTA.
The VTA may insure against any accident or destruction of the system or any part thereof. The VTA may insure against loss of revenues from any cause whatsoever. It may provide, in the proceedings authorizing the issuance of any bonds, for the carrying of insurance in an amount and of a character as may be specified and for the payment of premiums thereon. The VTA may also provide insurance as provided in Part 6 (commencing with Section 989) of Division 3.6 of Title 1 of the Government Code.
The VTA may contract for the services of independent contractors.
The Santa Clara County Transit District, which was established with the approval of the voters in 1972, shall continue as an entity under the control of its governing board as reorganized pursuant to the amendments to this part by statutes that were enacted in 1994. Nothing in the act that added this section during the second year of the 1993–94 Regular Session shall be construed to alter, impair, or terminate existing contracts between the district and other parties, including, but not limited to, funding agreements, grants, labor agreements, agreements entered into pursuant to Section 13(c) of the Federal Transit Act and its antecedents, bonds, notes, equipment trust certificates, or other obligations of the district. All rights and powers of the district shall continue in full force and effect and no affirmation, adoption, or assumption by the board of directors is required for that continuation. The VTA shall become the successor to certain county contracts as provided by agreement between the county and the VTA.
ARTICLE 3. Property [100130. - 100133.]
The VTA may take by grant, purchase, devise, or lease, or condemn in proceedings under eminent domain, or otherwise acquire, and hold and enjoy, real and personal property of every kind within or without the boundaries of the VTA necessary to the full or convenient exercise of its powers. The board may lease, mortgage, sell, or otherwise dispose of any real or personal property within or without the boundaries of the VTA necessary to the full or convenient exercise of its powers.
The VTA may take by gift, or take or convey by grant, purchase, devise, or lease, and hold and enjoy, real and personal property of every kind within or without the boundaries of the VTA necessary for, incidental to, or convenient for, transit-oriented joint development projects that meet the definition and requirement set forth in subdivision (b).
For purposes of this section, a transit-oriented joint development project is a commercial, residential, or mixed-use development that is undertaken in connection with existing, planned, or proposed transit facilities and is located 14 mile or less from the external boundaries of that facility.
Any transit-oriented joint development project created under this section shall comply with the land use and zoning regulations of the city, county, or city and county in which the project is located.
Notwithstanding Sections 53090 and 53091 of the Government Code or any other provision of law, the authority granted under this section is subject to the land use and zoning regulations of the city, county, or city and county jurisdiction in which the transit-oriented joint development is located, in accordance with the Planning and Zoning Law (Title 7 (commencing with Section 65000) of the Government Code), relating to zoning.
The VTA may exercise the right of eminent domain to take any property necessary or convenient to the exercise of the powers granted in this part. The VTA, in exercising this power, shall in addition to the damages for the taking, injury, or destruction of property, also pay the cost, exclusive of betterment and with credit for salvage value, of removal, reconstruction, or relocation of any structure, railways, mains, pipes, conduits, wires, cables, or poles of any public utility that are required to be moved to a new location.
No taking or acquisition by the VTA that would involve the abandonment, removal, relocation, or use of the property of a railroad corporation, as defined in Section 230, shall be permitted, unless the Public Utilities Commission, after a hearing, shall find and determine that the public interest and necessity require the abandonment, removal, relocation, or use of that property and that the taking or acquisition will not unreasonably impair the ability of the railroad corporation involved to provide safe, adequate, economical, and efficient service.
The Public Utilities Commission of the state shall have and exercise power and jurisdiction to fix just compensation to be paid for the taking of any property of a public utility in eminent domain proceedings brought by the VTA. The VTA may commence and maintain the eminent domain proceedings in the Public Utilities Commission or the superior court at its option.
The VTA is entitled to the benefit of any reservation or grant, in all cases, where any right has been reserved or granted to any public agency to construct or maintain roads, highways, or other crossings over any public or private lands.
ARTICLE 4. Construction Manager/General Contractor Project Delivery Contracts [100150. - 100156.]
For purposes of this article, the following terms shall have the following meanings:
“Construction Manager/General Contractor method” or “CMGC” means the Construction Manager/General Contractor method as defined in subdivision (b) of Section 6951 of the Public Contract Code.
“Construction manager” means a construction manager as defined in subdivision (c) of Section 6951 of the Public Contract Code.
Subject to the limitations of this article, the authority may utilize the CMGC project delivery method for public transit projects within its jurisdiction.
The authority may enter into a CMGC project delivery method contract pursuant to this article if, after evaluation of the traditional design-bid-build process of construction and of the CMGC project delivery method in a public meeting, the authority makes a written finding that use of the CMGC project delivery method on the specific project under consideration will accomplish one or more of the following objectives: reduce project costs, expedite the project’s completion, or provide features not achievable through the design-bid-build method. This finding shall be made prior to the authority entering into a CMGC project delivery method contract. In the CMGC project delivery method proposal, the written findings shall be included as part of an application for state funds for a transit project.
Any public works project that is contracted for pursuant to this article shall be subject to the requirements of Section 1771.4 of the Labor Code.
If a contract for CMGC services is entered into pursuant to this article and includes preconstruction services by the construction manager, the VTA shall enter into a written contract with the construction manager for preconstruction services, under which the VTA shall pay the construction manager a fee for preconstruction services in an amount agreed upon by the VTA and the construction manager. The preconstruction services contract may include fees for services to be performed during the contract period. The VTA shall not request or obtain a fixed price or a guaranteed maximum price for the construction contract from the construction manager or enter into a construction contract with the construction manager until after the VTA has entered into a services contract. A preconstruction services contract shall provide for the subsequent negotiation for construction of all or any discrete phase or phases of the project and shall provide for the VTA to own the design plans and other preconstruction services work product.
A contract for construction services shall be awarded after the plans have been sufficiently developed and either a fixed price or a guaranteed maximum price has been successfully negotiated. In the event that a fixed price or a guaranteed maximum price is not negotiated, the VTA may award the contract for construction services utilizing any other procurement method authorized by law.
The construction manager shall perform not less than 30 percent of the work covered by the fixed price or guaranteed maximum price agreement reached. Work that is not performed directly by the construction manager shall be bid to subcontractors pursuant to Section 6955 of the Public Contract Code.
Nothing in this article affects, expands, alters, or limits any rights or remedies otherwise available at law.
Upon completion of a project using the CMGC project delivery method, the VTA shall prepare a progress report to the board of directors. The progress report shall include, but shall not be limited to, all of the following information:
A description of the project.
The entity that was awarded the project.
The estimated and actual costs of the project.
The estimated and actual schedule for project completion.
A description of any written protests concerning any aspect of the solicitation, bid, proposal, or award of the project, including, but not limited to, the resolution of the protests.
An assessment of the prequalification process and criteria utilized under this article.
A description of the method used to evaluate the bid or proposal, including the weighting of each factor and an assessment of the impact of this requirement on a project.
A description of any challenges or unexpected problems that arose during the construction of the project and a description of the solutions that were considered and ultimately implemented to address those challenges and problems.
Recommendations to improve the CMCG project delivery method authorized under this article.
The progress report shall be made available on the VTA’s Internet Web site.
The provisions of this article are severable. If any provision of this article or its application is held invalid, that invalidity shall not affect other provisions or applications that can be given effect without the invalid provision or application.
Contracts awarded pursuant to this article shall be valid until the project is completed.
ARTICLE 4.5. Job Order Contracting [100157. - 100157.9.]
For purposes of this article, the following definitions apply:
“Job order contract” means an indefinite-quantity contract for repair, remodeling, or other repetitive work to be done according to unit prices.
“Typical work” means a work description applicable universally or applicable to a large number of individual projects, as distinguished from work specifically described with respect to an individual project.
“Unit price” means the amount paid for a single unit of an item of work.
The VTA may enter into a job order contract.
The VTA shall not enter into a job order contract for work that is protected by collective bargaining agreements.
The VTA shall not enter into a job order contract for new construction.
The VTA may enter into a job order contract only if the job order contract, and the task orders within the contract, is subject to the project labor agreement between the VTA and the Santa Clara and San Benito Counties Building and Construction Trades Council, unless otherwise exempted by that project labor agreement.
The VTA shall only enter into a job order contract with the lowest responsible and responsive bidder, based on the bidder’s plans and specifications for typical work.
A single job order contract shall not exceed five million dollars ($5,000,000) in the first term of the job order contract and, if extended or renewed, ten million dollars ($10,000,000) over the maximum of two extended terms of the job order contract.
The VTA may execute a job order contract for an initial contract term of no more than 12 months, with the option of extending or renewing the job order contract for two additional 12-month periods. An extension or renewal shall be priced as provided in the invitation for bids. An extension or renewal shall be mutually agreed to by the VTA and the contractor pursuant to the job order contract.
The job order contract shall specify that its term will not exceed the contract term or the date that the maximum value of the contract is achieved, whichever is earlier.
If the VTA acts pursuant to the authorization in subdivision (a) of Section 100157.5, then the VTA, on or before January 1, 2027, shall submit to the appropriate policy and fiscal committees of the Legislature a report on the use of job order contracting under this article.
The report shall include, but not be limited to, all of the following information:
A description of the VTA’s system for evaluating job order contract bids for award of job order contracts, including, but not limited to, the criteria used by the VTA to determine a qualified and responsive job order contractor.
A description of each job order contract awarded and the contractor awarded the contract.
An assessment of the use of job order contracting under this article.
A report to be submitted pursuant to subdivision (a) shall be submitted in compliance with Section 9795 of the Government Code.
This article shall remain in effect only until January 1, 2028, and as of that date is repealed.
ARTICLE 5. Transit Facilities and Service [100160. - 100169.]
The VTA may provide transit service for the transportation of passengers and their incidental baggage by any means.
The VTA may provide facilities, including streets and highways, for the movement of vehicles, bicycles, and pedestrians. All installations in state highways shall be developed and implemented with the concurrence and under the oversight of the Department of Transportation. The installation shall conform to requirements and regulations established by the Department of Transportation.
The VTA may enter into agreements with any city within the boundaries of the VTA or with the County of Santa Clara to improve a street, road, highway, or expressway under the jurisdiction of the city or county. This section does not apply to highways under the jurisdiction of the state, unless specifically permitted elsewhere in statute.
The VTA may operate charter bus service subject to the following limitations:
No bus equipment that is designed solely for charter service shall be purchased. A bus equipped with a toilet or underfloor baggage compartment shall be deemed charter equipment.
The board shall hold a public hearing prior to adopting a charter rate schedule or any amendment thereof. Notice of the hearing shall be mailed to each charter-party carrier operating within the district at least 30 days prior to the hearing. The notice shall include the proposed charter rate schedule. At the close of the public hearing the board may adopt charter rate schedules that shall not be less than the average for the three largest private charter-party carriers operating similar service within the boundaries of the VTA.
Charter service shall originate and terminate within the area served by the VTA unless a private charter-party carrier requests the VTA to provide service beyond the area served by the VTA.
Notwithstanding Section 100160.5 or any other law, a district may provide charter bus service for the 2026 FIFA World Cup during the period from June 1, 2026, to July 31, 2026, inclusive, if all of the following conditions are met:
Bus equipment that is designed solely for charter service is not purchased. A bus equipped with a toilet or underfloor baggage compartment shall be deemed charter equipment.
Charter service originates and terminates within the area served by the district unless a private charter-party carrier requests the district to provide service beyond the area served by the district.
The district establishes a schedule of rates for charter bus services that are incidental to the holding of the 2026 FIFA World Cup in the area authorized to be served pursuant to paragraph (2) subject to the following requirements:
The rates for charter-party bus services established under this subdivision are sufficient to pay all marginal costs related to those charter bus services and contribute financially to the reduction of deficits incurred by the district in the operation of scheduled route services.
The rates are at least equal to the average of the lowest rates charged by the three largest private charter-party carriers operating similar service in the greater San Francisco Bay area.
The schedule of rates are effective from June 1, 2026, to July 31, 2026, inclusive.
The district provides charter bus service for the events to the extent that private charter-party carriers are not capable of providing that service.
This section does not override any collective bargaining agreement between the district and a labor organization that represents employees of the district and does not authorize the district to provide charter bus service via contracting with private entities. Any charter bus service provided pursuant to this section shall be operated by the district with employees of the district.
For purposes of this section, the following definitions apply:
“District” means the VTA and any other public transportation operator providing public transit services in any portion of the greater San Francisco Bay area.
“Greater San Francisco Bay area” means the region comprised of the City and County of San Francisco and the Counties of Alameda, Contra Costa, Marin, Monterey, Napa, San Benito, San Mateo, Santa Clara, Santa Cruz, Solano, and Sonoma.
“Not capable of providing that service” includes, but is not limited to, the inability to meet requirements, including, but not limited to, requirements with regard to unique equipment, fuel type, number of doors, frequency, public safety, accommodations for standing passengers, handicap accessibility, or the nature of the service.
This section shall remain in effect only until January 1, 2027, and as of that date is repealed.
The VTA may acquire, construct, own, operate, control, or use rights-of-way, rail lines, buslines, stations, platforms, switches, yards, terminals, and any and all facilities necessary or convenient for transit service within or partly without the boundaries of the VTA, underground, upon, or above the ground and under, upon, or over public streets or other public ways or waterways, together with all physical structures, including parking lots and day care centers and related child care facilities, that are necessary or convenient for the access of persons or vehicles thereto. The VTA may acquire any interest in or rights to use or the joint use of any or all of those facilities.
The VTA may acquire, construct, and provide for repair and maintenance of any and all facilities necessary or convenient for vehicular and pedestrian transportation, within or partly without the boundaries of the VTA, underground, upon, or above the ground, together with all physical structures, including parking lots and soundwalls, that are necessary or convenient therefor. In this connection, the VTA may exercise any power with respect to highways granted to counties under Article 1 (commencing with Section 760) of Chapter 4 of Division 1 of the Streets and Highways Code in connection with any project included in the countywide transportation plan and an adopted regional transportation plan, but shall not usurp or impinge upon the powers and responsibilities granted to the county with regard to county highways. Highway and other transportation expenditures shall be consistent with adopted regional transportation plans and programs.
VTA installations in freeways shall be subject to the approval of the Department of Transportation. Installations in other state highways shall be subject to Article 2 (commencing with Section 670) of Chapter 3 of Division 1 of the Streets and Highways Code. Installations in county highways and city streets shall be subject to similar encroachment permits.
The VTA shall not use any state transportation funds, including, but not limited to, moneys in the State Highway Account, or the Transportation Planning and Development Account, in the State Transportation Fund, and passenger rail and clean air bond act money to acquire, construct, or operate day care centers and related child care facilities.
The VTA may lease or contract for the use of its transit facilities, or any portion thereof, to any operator, and may provide for subleases by an operator upon terms and conditions as it deems in the public interest. The word “operator” as used in this section means any public agency or any person.
The board may contract with any public agency or person to provide transit or transportation facilities and services for the VTA.
The VTA may construct and operate or acquire and operate transit works and facilities and may construct, acquire, and provide for repair and maintenance of transportation facilities, in, under, upon, over, across, or along any state or public highway or any stream, bay, or watercourse, or over any of the lands that are the property of the state, to the same extent that the rights and privileges appertaining thereto are granted to municipalities within the state.
Notwithstanding subdivision (a), and subject to the approval of the Department of Transportation, the VTA may provide funding for the repair and maintenance of state highways within the boundaries of the VTA.
The VTA shall not directly, or indirectly, except by providing funding pursuant to paragraph (1), repair or maintain any state highway.
The VTA may enter into agreements for the joint use of any property and rights by the VTA and any public agency or public utility operating transit facilities; may enter into agreements with any public agency or public utility operating any transit facilities, and wholly or partially within or without the boundaries of the VTA, for the joint use of any property of the VTA or of the public agency or public utility, or the establishment of through routes, joint fares, transfer of passengers, or pooling arrangements.
The rates and charges, if any, for transit service furnished pursuant to this part shall be fixed by the board and shall be reasonable.
The VTA shall be subject to the provisions of Division 14.8 (commencing with Section 34500) of the Vehicle Code with respect to operation of buses and to the rules and regulations enforceable by the State of California Highway Patrol pursuant to that chapter regulating the safe operation of buses.
The VTA shall be subject to the regulations of the Public Utilities Commission relating to safety appliances and procedures, and the commission shall inspect all work done pursuant to this part and may make further additions or changes necessary for the purpose of safety to employees and the general public. The commission shall enforce the provisions of this section.
The VTA and any one or more school districts located within its boundaries may enter into agreements pursuant to which school transportation equipment may be used for transit purposes within the VTA’s boundaries during any time that the equipment is not actually required for school purposes.
ARTICLE 6. Public Grants, Loans and Contributions [100170. - 100171.]
The VTA may accept, without limitation by any other provisions of this part requiring approval of indebtedness, contributions, grants, or loans from any public agency or the United States or any department, instrumentality, or agency thereof, for the purpose of financing the acquisition, construction, maintenance, or operation of transit facilities, or the acquisition and construction of transportation facilities. The VTA may enter into contracts and cooperate with, and accept cooperation from, any public agency or the United States, or agency thereof, in the acquisition, construction, maintenance, or operation, and in financing the acquisition, construction, maintenance, or operation of any transit facilities or in the acquisition and construction of any transportation facilities in accordance with any legislation that Congress or the Legislature of the State of California may have heretofore adopted or may hereafter adopt, under which aid, assistance, and cooperation may be furnished by the United States or any public agency in the acquisition, construction, maintenance, and operation of any transit or transportation facilities. The VTA may do any and all things necessary in order to avail itself of aid, assistance, and cooperation under any federal or state legislation now or hereafter enacted. Any evidence of indebtedness issued under this section shall constitute a negotiable instrument.
The VTA may obtain temporary transfers of funds in accordance with the last paragraph of Section 6 of Article XVI of the California Constitution.
ARTICLE 9. Retail Transaction and Use Tax [100250. - 100256.]
A retail transactions and use tax ordinance may be adopted by the board of directors in accordance with the provisions of Part 1.6 (commencing with Section 7251) of Division 2 of the Revenue and Taxation Code, if the electors voting on the measure vote in accordance with Article XIII C of the California Constitution to authorize its enactment at a special election called for that purpose by the board of directors.
Any transactions and use tax ordinance adopted shall be operative in accordance with Section 7265 of the Revenue and Taxation Code.
The VTA may contract with the State Board of Equalization for its service in the preparations necessary to administer a transaction and use tax ordinance. The costs to be covered by the contract are to be for services of the types described in Section 7272 of the Revenue and Taxation Code for preparatory work up to the date of the adoption of the ordinance. Any disputes as to the amount of the costs shall be resolved in the same manner as provided in that section.
Prior to the operative date of the transaction and use tax ordinance, the VTA shall contract with the State Board of Equalization to perform all functions incident to the administration and operation of the ordinance.
If the VTA shall not have contracted with the State Board of Equalization prior to the operative date of its transaction and use tax ordinance, it shall nevertheless so contract, and, in that case, the operative date shall be the first day of the first calendar quarter following the execution of the contract.
Repeal of the transactions and use tax ordinance shall not be operative earlier than the first day of the first calendar quarter following the adoption of the ordinance of repeal.
Whenever a bond election is held to authorize a bonded indebtedness pursuant to Section 100400, the ordinance calling the election may include a statement that the transaction and use taxes, or a stated portion thereof, shall be levied, or continued to be levied, and used to the extent required to pay the principal of, and interest on, the bonds as they become due, to provide any sinking fund payments required therefor, and to create or maintain any reserve fund required therefor.
A vote in favor of the issuance of the bonds shall authorize the use of such taxes for such purposes. The transactions and use tax ordinance shall not be repealed until all bonds payable from the revenues derived from such taxes have been fully paid or provision has been made for their payment in full.
CHAPTER 6. Personnel [100300. - 100381.]
ARTICLE 1. Employee Relations [100300. - 100312.]
Employees shall have the right to self-organization, to form, join or assist labor organizations, to bargain collectively through representatives of their own choosing, and to engage in other concerted activities for the purpose of collective bargaining or other mutual aid or protection.
Any question which may arise with respect to whether a majority of employees in an appropriate unit desire to be represented by a labor organization shall be submitted to the Public Employment Relations Board. In resolving those questions of representation including the determination of the appropriate unit or units, petitions, the conduct of hearings and elections, the board shall apply the relevant federal law and administrative practice developed under the Labor Management Relations Act of 1947, as amended, and for this purpose shall adopt appropriate rules and regulations. The California State Mediation and Conciliation Service shall administer the rules and regulations and shall provide for a prompt public hearing and secret ballot election to determine the question of representation and shall certify the results to the parties. Any certification of a labor organization to represent or act for the employees in any collective bargaining unit shall not be subject to challenge on the grounds that a new substantial question of representation within the collective bargaining unit exists until the lapse of one year from the date of certification or the expiration of any collective bargaining agreement, whichever is later, except that no collective bargaining agreement shall be considered to be a bar to representation proceedings for a period of more than two years.
Whenever a majority of the employees employed by the VTA in a unit appropriate for collective bargaining indicate a desire to be represented by a labor organization and upon determining, as provided in Section 100301, that said labor organization represents at least a majority of the employees in the appropriate unit, the board and the accredited representative of employees shall bargain in good faith and make all reasonable efforts to reach agreement on the terms of a written contract governing wages, hours, and working conditions.
A contract or agreement shall not be made with any labor organization, association, group, or individual that denies membership on any basis listed in subdivision (a) of Section 12940 of the Government Code, as those bases are defined in Sections 12926 and 12926.1 of the Government Code. However, the organization may preclude from membership any individual who advocates the overthrow of the government by force or violence.
The VTA shall not discriminate with regard to employment against any person on any basis listed in subdivision (a) of Section 12940 of the Government Code, as those bases are defined in Sections 12926 and 12926.1 of the Government Code, except as otherwise provided in Section 12940 of the Government Code.
If, after a reasonable period of time, representatives of the VTA and the accredited representatives of the employees fail to reach agreement on the terms of a written contract governing wages, hours, pensions, and working conditions or the interpretation or application of the terms of an existing contract, either party may request mediation services of the State Conciliation Service.
If, after a reasonable period of time, representatives of the VTA and the accredited representatives of the employees fail to reach agreement either on the terms of a written contract governing wages, hours, pensions, and working conditions or the interpretation or application of the terms of an existing contract, upon the agreement of both the VTA and the representatives of the employees, the dispute may be submitted to an arbitration board and the decision of the majority of the arbitration board shall be final and binding. The arbitration board shall be composed of two representatives of the district and two representatives of the labor organization, and they shall endeavor to agree upon the selection of a fifth member. If they are unable to agree, the names of five persons experienced in labor arbitration shall be obtained from the State Conciliation Service. The labor organization and the VTA shall, alternately, strike a name from the list so supplied, and the name remaining after the labor organization and the VTA have stricken four names, shall be designated as the fifth arbitrator and chairman of the board of arbitration. The labor organization and the VTA shall determine by lot who shall first strike a name from the list. The decision of a majority of the arbitration board shall be final and binding upon the parties thereto. Each party shall be responsible for the expense of the presentation of its case. All other expenses of arbitration shall be borne equally by the parties and said expenses may include the making of a verbatim record of the proceedings and transcript of that record.
Chapter 10 (commencing with Section 3500) of Division 4 of Title 1 of the Government Code is not applicable to the VTA.
The amendments to this section made at the 1995–96 Regular Session are not intended to modify, and shall not have the effect of modifying, an existing bargaining unit determination made by the Department of Industrial Relations pursuant to Section 100301.
County employees and employees of the Santa Clara County Congestion Management Agency who, on a date or dates determined by the board of directors, terminate their employment and immediately thereafter become employees of the VTA, shall transfer to the VTA, and the VTA shall assume liability for, all of their accrued and unused vacation, sick leave, personal leave, compensating time off, STO balances, and days of accrued service in accordance with the records of their former employer in lieu of any payment by the former employer for those balances. Those employees who were covered by a county or congestion management agency pension plan shall be entitled to the same or equivalent rights, options, privileges, benefits, obligations, accrued service, and status under the pension plan of the VTA.
It is a primary purpose of this article to promote the improvement of personnel management and employer-employee relations within the VTA by providing a uniform basis for recognizing the right of employees to join employee organizations of their own choice, to be represented, to select one employee organization as the exclusive representative of the employees in an appropriate unit, and to afford employees a voice at work.
The Public Employment Relations Board established pursuant to Section 3541 of the Government Code, and the powers and duties of the Public Employment Relations Board as described in Section 3541.3 of the Government Code, shall have jurisdiction pursuant to subdivision (b) of Section 100310 to enforce this article and the regulations of the Public Employment Relations Board shall apply to this article. The Public Employment Relations Board shall perform its duties under this section consistent with its regulations and may make additional regulations. The Public Employment Relations Board may also adopt, amend, or repeal all rules and regulations necessary to carry out this article as emergency regulations in accordance with the rulemaking provisions of the Administrative Procedure Act (Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code). The adoption, amendment, or repeal of regulations pursuant to this subdivision is conclusively presumed to be necessary for the immediate preservation of the public peace, health, safety, or general welfare within the meaning of Section 11346.1 of the Government Code.
This article shall not displace or supplant the requirements of Chapter 3 (commencing with Section 3610) of Division 4.5 of Title 1 of the Government Code, and the impasse resolution and injunctive relief procedures provided for pursuant to Sections 3612 to 3614, inclusive, of the Government Code shall remain exclusive.
An exclusive representative for employees of the VTA may select to move one or more of its represented bargaining units to the jurisdiction of the Public Employment Relations Board for unfair practice charges. A selection for Public Employment Relations Board jurisdiction pursuant to this paragraph with regard to a bargaining unit shall be irrevocable for that unit. The exclusive representative shall file notification of such a selection with the general counsel of the Public Employment Relations Board, or a designee, and serve one or more of the following:
The general manager, chief executive officer, or the equivalent, of the VTA.
The general legal counsel, or the equivalent, of the VTA.
The VTA, pursuant to applicable regulations.
If a selection is made pursuant to paragraph (1) for Public Employment Relations Board jurisdiction over unfair practice charges, the initial determination as to whether the charge of unfair practice is justified and, if so, the appropriate remedy necessary to effectuate the purposes of this article, is a matter within the exclusive jurisdiction of the Public Employment Relations Board, except that in an action to recover damages due to an unlawful strike, the Public Employment Relations Board shall not award strike-preparation expenses as damages and shall not award damages for costs, expenses, or revenue losses incurred during, or as a consequence of, an unlawful strike.
The VTA shall give reasonable written notice to an exclusive representative of its intent to make any change to matters within the scope of representation of the employees represented by the exclusive representative for purposes of providing the exclusive representative a reasonable amount of time to negotiate with the VTA regarding the proposed changes.
Any charging party, respondent, or intervenor aggrieved by a final decision or order of the Public Employment Relations Board in an unfair practice case, except a decision of that board not to issue a complaint in such a case, may petition for a writ of extraordinary relief from that decision or order.
A petition for a writ of extraordinary relief shall be filed in the district court of appeal having jurisdiction over any county in which the VTA operates. The petition shall be filed within 30 days from the date of the issuance of the Public Employment Relations Board’s final decision or order, or order denying reconsideration, as applicable. Upon the filing of the petition, the court shall cause notice to be served upon the Public Employment Relations Board and thereafter shall have jurisdiction of the proceeding. The Public Employment Relations Board shall file in the court the record of the proceeding, certified by that board, within 10 days after the clerk’s notice unless that time is extended by the court for good cause shown. The court shall have jurisdiction to grant any temporary relief or restraining order it deems just and proper, and in like manner to make and enter a decree enforcing, modifying, and enforcing as modified, or setting aside in whole or in part, the decision or order of the Public Employment Relations Board. The findings of the Public Employment Relations Board with respect to questions of fact, including ultimate facts, if supported by substantial evidence on the record considered as a whole, shall be conclusive. Title 1 (commencing with Section 1067) of Part 3 of the Code of Civil Procedure relating to writs shall, except where specifically superseded by this section, apply to proceedings pursuant to this section.
If the time to petition for extraordinary relief from a Public Employment Relations Board decision or order has expired, the Public Employment Relations Board may seek enforcement of any final decision or order in a district court of appeal or superior court having jurisdiction over the county where the events giving rise to the decision or order occurred. The Public Employment Relations Board shall respond within 10 days to any inquiry from a party to the action as to why the Public Employment Relations Board has not sought court enforcement of the final decision or order. If the response does not indicate that there has been compliance with the Public Employment Relations Board’s final decision or order, the Public Employment Relations Board shall seek enforcement of the final decision or order upon the request of the party. The Public Employment Relations Board shall file in the court the record of the proceeding, certified by that board, and appropriate evidence disclosing the failure to comply with the decision or order. If, after the hearing, the court determines that the order was issued pursuant to the procedures established by the Public Employment Relations Board and that the person or entity refuses to comply with the order, the court shall enforce the order by writ of mandamus or other proper process. The court may not review the merits of the order.
ARTICLE 2. Rights of Employees of Existing Facilities [100350. - 100351.]
Whenever the VTA acquires existing facilities from a publicly or privately owned utility, either in proceedings by eminent domain or otherwise, to the extent necessary for operation of facilities, all of the employees of the public utility whose duties pertain to the facilities acquired who have been employed by said utility for at least 75 days shall be appointed to comparable positions in the VTA without examination and these employees shall be given sick leave, seniority, and vacation credits in accordance with the records of the acquired public utility. No employee of any acquired public utility shall suffer any worsening of wages, seniority, pension, vacation, or other benefits by reason of the acquisition.
Whenever the VTA acquires existing facilities from a publicly or privately owned utility, either in proceedings in eminent domain or otherwise, the VTA shall assume and observe all existing labor contracts.
The provisions of this section apply only to those officers or supervisory employees of the acquired utility as shall be designated by the board.
Whenever the VTA acquires existing facilities from a publicly or privately owned utility, either in proceedings in eminent domain or otherwise, that has a pension plan in operation, members and beneficiaries of the pension plan shall continue to have the rights, privileges, benefits, obligations, and status with respect to the established system. The outstanding obligations and liabilities of the public utility by reason of the pension plan shall be considered and taken into account and allowance made therefor in the purchase price of the public utility. The persons entitled to pension benefits as provided for in this section and the benefits that are provided shall be specified in the agreement or order by which any public utility is acquired by the VTA.
ARTICLE 3. Pension Plan [100370. - 100372.]
The board may establish a retirement system for the officers and employees of the VTA and provide for the payment of annuities, pensions, retirement allowances, disability payments, and death benefits or any of them. The adoption, terms, and conditions of any retirement system covering employees of the VTA in a bargaining unit represented by a labor organization shall be pursuant to a collective bargaining agreement between the labor organization and the VTA. For purposes of this section, “officers” does not include members of the board of directors.
The board may contract with the board of administration of the Public Employees’ Retirement System and enter all or any portion of its employees under that system if no employees of the VTA in a bargaining unit that is represented by a labor organization are included in the contract except as authorized by a collective bargaining agreement.
All persons receiving pension benefits from an acquired public utility and all persons entitled to pension benefits under any pension plan of the acquired public utility may become members or receive pensions under a pension plan established by the VTA by mutual agreement of the persons and the VTA. The agreement may provide for the waiver of all rights, privileges, benefits, and status with respect to the pension plan of the acquired public utility.
ARTICLE 4. Other Benefits [100380. - 100381.]
The VTA shall take the steps as may be necessary to obtain coverage for the VTA and its employees under Title 2 of the Federal Social Security Act, as amended, and the related provisions of the Federal Contributions Act, as amended.
The VTA shall take the steps as may be necessary to obtain coverage for the VTA and its employees under the workers’ compensation, unemployment compensation disability, and unemployment insurance laws of the State of California.
CHAPTER 7. Bonds and Other Evidences of Indebtedness [100400. - 100492.]
ARTICLE 1. Authorization and Issuance of General Obligation Bonds [100400. - 100413.]
Whenever the board deems it necessary for the VTA to incur a bonded indebtedness for the acquisition, construction, or repair of any or all improvements, works, property, or facilities, authorized by this part or necessary or convenient for the carrying out of the powers of the VTA, or for any other purpose authorized by this part, the board shall, by ordinance, adopted by a vote of two-thirds of all members of the board, so declare and call an election to be held within the boundaries of the VTA for the purpose of submitting to the qualified voters thereof the proposition of incurring indebtedness by the issuance of bonds of the VTA, if the total amount of bonds issued and outstanding pursuant to this article do not exceed 15 percent of the assessed value of the taxable property of the VTA as shown by the last equalized assessment roll of the County of Santa Clara. The ordinance shall state:
The purposes for which the proposed debt is to be incurred, which may include all costs and estimated costs incidental to or connected with the accomplishment of those purposes, including, without limitation, engineering, inspection, legal, fiscal agents, financial consultant, and other fees; bond and other reserve funds; working capital; bond interest estimated to accrue during the construction period and for a period not to exceed three years thereafter; and expenses of all proceedings for the authorization, issuance, and sale of the bonds.
The estimated cost of accomplishing those purposes.
The amount of the principal of the indebtedness.
The maximum term the bonds proposed to be issued shall run before maturity, which shall not exceed 50 years from the date thereof or the date of each series thereof.
The maximum rate of interest to be paid, which shall not exceed 7 percent per annum.
The proposition to be submitted to the voters, which may include one or more purposes.
The date of the election.
The manner of holding the election and the procedure for voting for or against the measure.
The ordinance may also contain a statement that the retail transaction and use tax mentioned in Article 9 (commencing with Section 100250) of Chapter 5, or a stated portion thereof, shall be levied, or continued to be levied, and used to the extent required to pay principal of and interest on the bonds as they become due, to provide for any sinking fund payments required therefor, or to create or maintain any reserve fund required therefor.
The ordinance may also contain any other matters authorized by this part or any other law.
Notice of holding of the election shall be given by publishing, pursuant to Section 6066 of the Government Code, the ordinance calling the election in at least one newspaper published within the boundaries of the VTA. No other notice of the election need be given. Except as otherwise provided in the ordinance, the election shall be conducted as other district elections.
If any proposition is defeated by the electors, the board shall not call another election on a substantially similar proposition to be held within six months after the prior election. If a petition requesting submission of such a proposition, signed by 15 percent of the district electors, as shown by the votes cast for all candidates for governor within the district at the last gubernatorial election, is filed with the board, it may call an election before the expiration of six months.
If a majority of the electors voting on the proposition vote for it, then the board may, by resolution, at a time or times as it deems proper, issue bonds of the VTA for the whole or any part of the amount of the indebtedness so authorized and may from time to time, by resolution, provide for the issuance of amounts as the necessity thereof may appear, until the full amount of the bonds authorized shall have been issued. The full amount of bonds may be divided into two or more series and different dates and different dates of payment fixed for the bonds of each series. A bond need not mature on an anniversary of its date. The maximum term the bonds of any series shall run before maturity shall not exceed 50 years from the date of each series respectively. In the resolution or resolutions, the board shall prescribe the form of the bonds, including, without limitation, registered bonds and coupon bonds, and the form of any coupons to be attached thereto, the registration, conversion, and exchange privileges, if any, pertaining thereto, and fix the time when the whole or any part of the principal shall become due and payable.
The bonds shall bear interest at a rate or rates not exceeding 7 percent per annum, payable semiannually, except that the first interest payable on the bonds or any series thereof may be for any period not exceeding one year as determined by the board. In the resolution or resolutions providing for the issuance of the bonds, the board may also provide for call and redemption of the bonds prior to maturity at times and prices and upon other terms as it may specify, but no bond shall be subject to call or redemption prior to maturity unless it contains a recital to that effect or unless a statement to that effect is printed thereon. The denomination or denominations of the bonds shall be stated in the resolution providing for their issuance, but shall not be less than one thousand dollars ($1,000). The principal of and interest on the bonds shall be payable in lawful money of the United States at the office of the treasurer of the VTA or at another other place or places as may be designated, or at either place or places at the option of the holders of the bonds. The bonds, or the series thereof, shall be dated and numbered consecutively and shall be signed by the chairman of the board and the treasurer, countersigned by the secretary and the official seal of the VTA attached. The interest coupons of the bonds shall be signed by the treasurer. All signatures, countersignatures, and the seal may be printed, lithographed, or mechanically reproduced, except that one of the signatures or countersignatures on the bonds shall be manually affixed. If any officer whose signature or countersignature appears on bonds or coupons ceases to be an officer before the delivery of the bonds, his signature is as effective as if he had remained in office.
The bonds may be sold as the board determines by resolution but for not less than par. Before selling the bonds, or any part thereof, the board shall give notice inviting sealed bids in such manner as it may prescribe. If satisfactory bids are received, the bonds offered for sale shall be awarded to the highest responsible bidder. If no bids are received or if the board determines that the bids received are not satisfactory as to price or responsibility of the bidders, the board may reject all bids received, if any, and either readvertise or sell the bonds at private sale.
Delivery of any bonds may be made at any place either inside or outside the state, and the purchase price may be received in cash or bank credits.
All accrued interest and premiums received on the sale of bonds shall be placed in the fund to be used for the payment of principal of and interest on the bonds and the remainder of the proceeds of the bonds shall be placed in the treasury to the credit of the proper improvement fund and applied exclusively to the purposes for which the debt was incurred, which purposes shall be in conformity with an approved general transit plan or element thereof then in effect. When those purposes have been accomplished any moneys remaining in the improvement fund (a) shall be transferred to the fund to be used for the payment of principal of and interest on the bonds, or (b) shall be placed in a fund to be used for the purchase of outstanding bonds of the VTA from time to time in the open market at prices and in a manner, either at public or private sale or otherwise, as the board may determine. Bonds so purchased shall be canceled immediately.
After the expiration of three years after a bond election the board may determine, by ordinance adopted by a vote of two-thirds of all the members of the board, that any or all of the bonds authorized at the election remaining unsold shall not be issued or sold. When the ordinance takes effect, the authorization to issue such bonds shall become void.
Whenever the board deems that the expenditure of money for the purposes for which the bonds were authorized by the voters is impractical or unwise, it may, by ordinance adopted by a vote of two-thirds of all members of the board, so declare and call an election to be held within the boundaries of the VTA for the purpose of submitting to the qualified voters thereof the proposition of incurring indebtedness by the issuance of the bonds for some other purposes or, in the case where bonds have been sold, the proposition to use the proceeds for some other purposes. The procedure, so far as applicable, shall be the same as when a bond proposition is originally submitted.
The board may provide for the issuance, sale, or exchange of refunding bonds to redeem or retire any bonds issued by the VTA upon the terms, at the times, and in the manner which it determines. Refunding bonds may be issued in a principal amount sufficient to pay all or any part of the principal of outstanding bonds, the interest thereon, and the premiums, if any, due upon call and redemption thereof prior to maturity and all expenses of the refunding. The provisions of this article for issuance and sale of bonds apply to the issuance and sale of the refunding bonds, except that (a) no election need be called or held for the purpose of authorizing the issuance of refunding bonds, and (b) when refunding bonds are to be exchanged for outstanding bonds, the method of exchange shall be as determined by the board.
The provisions of Article 4 (commencing with Section 53500) of Chapter 3 of Part 1 of Division 2 of Title 5 of the Government Code are applicable to the VTA.
Any bonds which shall be issued under the provisions of this article shall be legal investment for all trust funds; for the funds of insurance companies, banks, both commercial and savings, and trust companies; and for state school funds. Whenever any money or funds may, by any law now or hereafter enacted, be invested in bonds of cities, cities and counties, counties, school districts, or other districts within the State of California, such money or funds may be invested in the bonds issued under this part. Whenever bonds of cities, cities and counties, counties, school districts, or other districts within this state may, by any law now or hereafter enacted, be used as security for the performance of any act or the deposit of any public moneys, the bonds issued under this part may be so used. The provisions of this article shall be in addition to all other laws relating to legal investments and shall be controlling as the latest expression of the Legislature with respect thereto.
If bonds are authorized that contain a provision for special taxes under subdivision (i) of Section 100400, the board may enter into such convenants as may be deemed proper to provide for issuance of additional parity bonds and the priority and pledge of special taxes; and such other covenants as are customary or desirable in the issuance of any bonds payable out of special funds or as are necessary, convenient, or desirable to secure the bonds or tending to make them more marketable, subject to the provisions of the ordinance calling the bond election.
ARTICLE 2. Revenue Bonds [100450. - 100451.]
The VTA may issue bonds, payable from revenue of any facility or enterprise to be acquired or constructed by the VTA, in the manner provided by the Revenue Bond Law of 1941 (Chapter 6 (commencing with Section 54300) of Part 1 of Division 2 of Title 5 of the Government Code), all of the provisions of which are applicable to the VTA, except that these bonds may be paid, in whole or in part, from revenues made available under Article 9 (commencing with Section 100250) of Chapter 5 and, in that case, the bonds may be issued without an election if the resolution authorizing the bonds provides that the retail transactions and use tax shall continue to be imposed under that Article 9 until the bonds are fully paid or provision has been made for their payment in full.
The VTA is a local agency within the meaning of the Revenue Bond Law of 1941 (Chapter 6 (commencing with Section 54300) of Part 1 of Division 2 of Title 5 of the Government Code). The term “enterprise” as used in the Revenue Bond Law of 1941 shall, for all purposes of this part, include the system or any or all transit facilities and all additions, extensions, and improvements thereto authorized to be acquired, constructed, or completed by the VTA. The VTA may issue revenue bonds under the Revenue Bond Law of 1941, for any one or more transit facilities authorized to be acquired, constructed, or completed by the VTA or, in the alternative, may issue revenue bonds under the Revenue Bond Law of 1941, for the acquisition, construction, and completion of any one of those transit facilities. Nothing in this article shall prevent the VTA from availing itself of, or making use of, any procedure provided in this part for the issuance of bonds of any type or character for any of the transit facilities authorized hereunder, and all proceedings may be carried on simultaneously or, in the alternative, as the board may determine.
ARTICLE 3. Equipment Trust Certificates [100460. - 100463.]
The VTA shall have power to purchase transit equipment such as cars, trolley buses, and motor buses, or rolling equipment; and may execute agreements, leases, and equipment trust certificates in the forms customarily used by private corporations engaged in the transit business appropriate to effect the purchase and leasing of transit equipment and may dispose of the equipment trust certificates upon terms and conditions as the board may deem appropriate. Payment for the equipment, or rentals therefor, may be made in installments, and the deferred installments may be evidenced by equipment trust certificates payable from any source or sources of funds specified in certificates that are or will be legally available to the VTA. Title to the equipment shall not rest in the VTA until the equipment trust certificates are paid.
The agreement to purchase or lease may direct the vendor or lessor to sell and assign or lease the rolling equipment to a bank or trust company duly authorized to transact business in the State of California as trustee, for the benefit and security of the equipment trust certificates and may direct the trustee to deliver the rolling equipment to one or more designated officers of the VTA and may authorize the VTA to execute and deliver simultaneously therewith an installment purchase agreement or a lease of the equipment to the VTA.
The agreements and leases shall be duly acknowledged before a person authorized by law to take acknowledgments of deeds and in the form required for acknowledgment of deeds. These agreements, leases, and equipment trust certificates shall be authorized by resolution of the VTA and shall contain covenants, conditions, and provisions that may be deemed necessary or appropriate to ensure the payment of the equipment trust certificates from legally available sources of funds specified in the certificates.
The covenants, conditions, and provisions of the agreements, leases, and equipment trust certificates shall not conflict with any of the provisions of any trust agreement securing the payment of bonds, notes, or certificates of the VTA.
ARTICLE 4. Improvement Acts and Special Benefit Districts [100470. - 100471.]
The Improvement Act of 1911, the Municipal Improvement Act of 1913, and the Improvement Bond Act of 1915 are applicable to the VTA.
The provisions of Chapter 1 (commencing with Section 99000) of Part 11 of Division 10 of the Public Utilities Code are applicable to the VTA.
ARTICLE 5. Temporary Borrowing [100482. - 100483.]
The VTA may borrow money in accordance with the provisions of Article 7 (commencing with Section 53820), or of Article 7.6 (commencing with Section 53850) of Chapter 4 of Part 1 of Division 2 of Title 5 of the Government Code.
The VTA may borrow money in anticipation of the sale of bonds that have been authorized to be issued, but have not been sold and delivered, and may issue negotiable bond anticipation notes therefor and may renew the same from time to time, but the maximum maturity of those notes, including the renewals thereof, shall not exceed five years from the date of delivery of the original notes. The notes may be paid from any moneys of the VTA available therefor and not otherwise pledged. If not previously otherwise paid, the notes shall be paid from the proceeds of the next sale of the bonds of the VTA in anticipation of which they were issued. The notes shall not be issued in any amount in excess of the aggregate amount of bonds that the VTA has been authorized to issue, less the amount of any bonds of that authorized issue previously sold, and also less the amount of other bond anticipation notes therefor issued and then outstanding. The notes shall be issued and sold in the same manner as the bonds. The notes and the resolution or resolutions authorizing them may contain any provisions, conditions, or limitations that a resolution of the VTA authorizing the issuance of bonds may contain.
ARTICLE 6. Miscellaneous [100490. - 100492.]
The VTA may bring an action to determine the validity of any of its bonds, equipment trust certificates, warrants, notes, or other evidences of indebtedness pursuant to Chapter 9 (commencing with Section 860) of Title 10 of Part 2 of the Code of Civil Procedure.
All bonds and other evidences of indebtedness issued by the VTA under the provisions of this part, and the interest thereon, are free and exempt from all taxation within the State of California, except for transfer, franchise, inheritance, and estate taxes.
Notwithstanding any other provisions of this part or any other law, the provisions of all ordinances, resolutions, and other proceedings in the issuance by the VTA of any bonds, bonds with a pledge of revenues, bonds for improvement districts, revenue bonds, equipment trust certificates, notes, or any and all evidences of indebtedness or liability shall constitute a contract between the VTA and the holders of the bonds, equipment trust certificates, notes, or evidences of indebtedness or liability and the provisions thereof shall be enforceable against the VTA, or any or all of its successors or assigns, by mandamus or any other appropriate suit, action, or proceeding in law or in equity in any court of competent jurisdiction. Nothing contained in this part or in any other law shall be held to relieve the VTA or the territory included within it from any bonded or other debt or liability contracted by the VTA. Upon dissolution of the VTA or upon withdrawal of territory therefrom, the property formerly included within it or withdrawn therefrom shall continue to be liable for the payment of all bonded and other indebtedness or liabilities outstanding at the time of the dissolution or withdrawal the same as if the VTA had not been so dissolved or the territory withdrawn therefrom, and it shall be the duty of the successors or assigns to provide for the payment of the bonded and other indebtedness and liabilities. Except as may be otherwise provided in the proceedings for the authorization, issuance, and sale of any revenue bonds, bonds secured by a pledge of revenues or bonds for improvement districts secured by a pledge of revenues, revenues of any kind or nature derived from any revenue-producing improvements, works, facilities, or property owned, operated, or controlled by the VTA shall be pledged, charged, assigned, and have a lien thereon for the payment of the bonds as long as they are outstanding, regardless of any change in ownership, operation, or control of the revenue-producing improvements, works, facilities, or property and it shall, in the later event or events, be the duty of the successors or assigns to continue to maintain and operate the revenue-producing improvements, works, facilities, or property as long as bonds are outstanding.
CHAPTER 8. Dissolution [100500. - 100500.]
The VTA may be dissolved pursuant to the Cortese-Knox-Hertzberg Local Government Reorganization Act of 2000 (Division 3 (commencing with Section 56000) of Title 5 of the Government Code).
CHAPTER 9. Benefit Assessment Districts [100600. - 100619.]
The Legislature finds and declares that:
It is necessary and in the best interest of the citizens of the state to authorize the VTA to levy special benefit assessments for needed public rail rapid transit facilities and services on the property that benefits from those facilities and services.
The rail rapid transit facilities and services provide special benefits to parcels of land, and improvements thereon, in the vicinity of rail rapid transit stations, and provide general benefits to the community at large. The Board of Directors of the VTA shall be the conclusive judge of the proportion of special and general benefits produced by the facilities and of the distribution of the special benefits among parcels of property within the benefit assessment district.
Whenever the board finds that property adjacent to, or in the vicinity of, one or more rail transit stations, or proposed rail transit stations, of the VTA receives or will receive special benefit by reason of the location or operation of one or more of those rail transit stations, the board may, by resolution adopted by a two-thirds vote of its members, provide for notice and hearing on its intention to establish one or more special benefit districts and levy a special benefit assessment on real property therein for the purpose of financing, in whole or in part, the acquisition, construction, development, joint development, operation, maintenance, or repair of one or more rail transit stations and rail transit related facilities located within the benefit district.
In connection with the levy of a special benefit assessment, the board shall comply with the notice, protest, and hearing procedures set forth in Section 53753 of the Government Code.
The resolution may provide that the proposed benefit district will contain separate zones, which may consist of either contiguous or noncontiguous areas of land within the boundaries of the VTA. The proposed benefit district and each proposed zone, if any, therein shall be an area adjacent to, or in the vicinity of, one or more rail transit stations or proposed rail transit stations. The boundaries of the benefit district and of each zone, if any, therein shall be drawn so as to reflect, as accurately as possible, the areas in which special benefits are conferred by reason of the proximity and operation of one or more rail transit stations.
A notice stating the time and place of the hearing, and setting forth the boundaries and purpose of the proposed benefit district, shall be published prior to the time fixed for the hearing pursuant to Section 6066 of the Government Code.
For purposes of this chapter, “benefit district” means a special benefit assessment district established pursuant to this chapter, the area of which shall not lie more than one-half mile from the center point of any rail transit station or proposed rail transit station.
For purposes of this chapter, “transit related facilities” means land, buildings, and equipment, or any interest therein, whether or not the operation thereof produces revenue, which has, as its primary purpose, the operation of the rail transit system or the providing of services to the passengers of the rail transit system, but does not mean any land, buildings, or equipment, or interest therein, which is used primarily for the production of revenue not arising from the operation of the rail transit system.
The resolution shall state, as appropriate, the maximum and minimum rate of assessment, the amount of the special benefit assessment and the purposes for which it is to be levied, the estimated cost of accomplishing the purposes, and the dates or approximate intervals at which the assessment shall be levied. The resolution shall also state that the exterior boundaries of the benefit district are set forth on a map on file with the secretary of the VTA, which map shall govern for all purposes as to the extent of the benefit district and zones, if any, therein and that the area set forth on the map shall thereupon constitute and be known as “Benefit District No. ____ of the Santa Clara Valley Transportation Authority,” or as “Benefit Zone ____ of the Benefit District No. ____ of the Santa Clara Valley Transportation Authority,” as designated by the board.
A copy of the resolution shall be included with the notice given pursuant to Section 53753 of the Government Code.
In determining the amount of a special benefit assessment, the board shall measure the benefit to real property in the benefit district or zones therein according to the procedures and approval process set forth in Section 4 of Article XIII D of the California Constitution.
The special benefit assessment constitutes a charge imposed on particular real property for a VTA project of direct benefit to that property, and does not constitute ad valorem taxes or any other form of general tax levy applying a given rate to the assessed valuation of all taxable property within the boundaries of the VTA.
The VTA shall possess all powers necessary for, incidental to, or convenient for, the collection, enforcement, administration, or distribution of the special benefit assessment in accordance with California law.
The revenue from a special benefit assessment, which is imposed pursuant to this chapter, or from bonds secured by the special benefit assessment, for the purpose of financing a rail transit station or rail transit related facility located within the benefit district, shall be used only for financing of the facility for which it was levied, and that revenue shall not be used for any other purpose or the payment of any other expense of the VTA, including, but not limited to, transit, transportation, or operating expense.
Where any parcel in the benefit district is owned in joint tenancy, tenancy in common, or any other multiple ownership, the owners of that parcel may designate in writing which one of the owners shall be deemed the owner of the parcel for purposes of submitting an assessment ballot pursuant to Section 53753 of the Government Code. In the absence of a designation, the provisions of paragraph (3) of subdivision (e) of Section 53753 of the Government Code shall apply.
The legal representative of a corporation or an estate owning real property in the benefit district may act on behalf of the corporation or the estate.
For purposes of this chapter, “legal representative” means an official of a corporation owning real property in the benefit district.
For purposes of this chapter, “legal representative” also means a guardian, conservator, executor, or administrator of the estate of the holder of title to real property in the benefit district who is all of the following:
The person is appointed under the laws of this state.
The person is entitled to the possession of the estate’s real property.
The person is authorized by the appointing court to exercise the particular right, privilege, or immunity that he or she seeks to exercise.
If there is no majority protest to the imposition of an assessment, the board may levy the assessment in accordance with the resolution adopted pursuant to Section 100601.
Any owner or owners of real property, which is, in whole or in part, within the benefit district, or their legal representatives, may jointly or severally file with the board a petition requesting that the real property owned by them or for which they are the legal representative be excluded from the benefit district on the ground that the real property sought to be excluded is not benefited or that the assessment be reduced on the ground that the assessment exceeds the benefit to that real property.
The real property sought to be excluded or upon which the assessment is sought to be reduced shall be described by its legal description and shall be accompanied by a map depicting its location in relation to the benefit district.
The petition shall contain a statement of facts in support of the petition and shall be acknowledged by the owner or the legal representative filing the petition.
Notice of each hearing upon the petition for exclusion or reduction shall be given in accordance with subdivision (d) of Section 100601. Notice shall also be mailed at least 30 days prior to the hearing to all record owners of each identified parcel within the boundaries of the benefit district or zone.
At the time and place provided in the notice or at any time and place to which the hearing is adjourned, the board or its appointed hearing officer shall hear all of the following:
The petition for exclusion or reduction.
All evidence or proofs that may be introduced by or on behalf of the petitioners.
All objections to the petition that may be presented in writing by any person, including the VTA.
All evidence or proofs that may be introduced in support of objections to the petition.
The expenses of giving the notice provided for herein and of the hearing on the exclusion or reduction petition shall be paid by the persons filing the petition.
Upon the hearing on an exclusion or reduction petition by the board, or upon the record of hearing by a hearing officer, the board shall order the petition be denied when the petitioner has not shown by a preponderance of the evidence that in an exclusion petition the real property is not benefited or in a reduction petition that the assessment exceeds the benefit to the property.
The board, after the hearing on an exclusion or reduction petition, shall order one of the following by resolution:
In the case of an exclusion petition, order the exclusion of all or any part of the real property described in the petition upon its finding that the property will not be benefited by the operations of the VTA in the vicinity of the benefit district.
In the case of a reduction petition, order a change in the benefit assessment to all or any portion of the real property described in the petition to provide that it not exceed the amount of benefit derived by the operations of the VTA in the vicinity of the benefit district.
Confirm the assessment on the real property subject to the petition as correctly reflecting the amount of benefit to the real property.
Following formation of the benefit district or concurrently therewith, if the board deems it necessary to incur a bonded indebtedness for the acquisition, construction, development, joint development, completion, operation, maintenance, or repair of one or more rail transit stations and related rail transit facilities located within the benefit district, the board may provide, by resolution, that the bonded indebtedness shall be payable from special benefit assessments levied within the benefit district. The resolution shall be adopted by a two-thirds vote of the members of the board, and shall declare and state all of the following:
That the board intends to incur an indebtedness, by the issuance of bonds of the VTA, for the benefit district which the board has formed, or intends to form, within a portion of the boundaries of the VTA.
The purposes for which the proposed debt is to be incurred, which may include all costs and estimated costs necessary or convenient for, incidental to, or connected with, the accomplishment of the purposes, including, without limitation, engineering, inspection, legal, fiscal agent, financial consultant, bond and other reserve funds, working capital, bond interest estimated to accrue during the construction period, if any, and for a period not exceeding three years thereafter, and the expenses of all proceedings for the authorization, issuance, and sale of the bonds.
The estimated cost of accomplishing the purposes and the amount of the principal of the indebtedness to be incurred.
That a general description of the benefit district and of each zone, if any, therein and maps showing the exterior boundaries thereof are on file with the secretary of the VTA and available for inspection by any interested person.
That special benefit assessments for the payment of the bonds, and the interest thereon, have been, or are proposed to be levied in the benefit district or zones therein in accordance with the procedures and approval process set forth in Section 4 of Article XIII D of the California Constitution.
The extent to which, if at all, all or a portion of the revenues of the VTA are to be used to pay the principal of, interest on, and sinking fund payments for, the bonds, including the establishment and maintenance of any reserve fund therefor.
The time and place set for hearing on the proposed issuance of the bonds.
That, prior to levying a special benefit assessment, the board shall comply with the notice, protest, and hearing procedures set forth in Section 53753 of the Government Code.
The maximum term the proposed bonds shall run before maturity, which shall not exceed 40 years from the date of the bonds or any series thereof.
The maximum rate or rates of interest to be paid, which shall not exceed 12 percent per annum.
That the pledge of special benefit assessment revenues to the bonds authorized by this section has priority over the use of any of those revenues for pay-as-you-go financing, except to the extent that this priority is expressly restricted by any of the VTA’s agreements with bondholders.
The notice stating the time and place of the hearing on the proposed issuance of bonds shall be published prior to the time fixed for the hearing pursuant to Section 6066 of the Government Code.
At the time and place fixed for the hearing on the issuance of bonds payable from special benefit assessments levied under this chapter, or at any time and place to which the hearing is adjourned, the board shall proceed with the hearing. Interested persons may appear at the hearing and present matters material to the questions set forth in the resolution. At the conclusion of the hearing on the proposed issuance of bonds, the board shall, by resolution adopted by a two-thirds vote of the members, determine whether to incur the bonded indebtedness.
The resolution shall state the amount of the proposed debt, the purposes for which it is to be incurred, and the estimated cost of accomplishing the purposes. The determinations made in the resolution are final and conclusive.
Special benefit assessments for the payment of the principal of, and interest on, bonds issued for a benefit district or zone shall be levied in the benefit district or zone at rates that are sufficient in the aggregate, together with revenues already collected and available, to pay the principal of, and interest on, all bonds the VTA issued for the benefit district or zone. Other revenues of the VTA shall be used for the payment of the principal of, and interest on, the bonds only to the extent set forth in any agreement of the VTA for the benefit of bondholders.
Special benefit assessments in the benefit district and zones, if any, therein shall be calculated in accordance with the requirements set forth in Section 4 of Article XIII D of the California Constitution.
The bonds issued pursuant to this chapter shall bear interest at a rate or rates not exceeding 12 percent per annum, payable semiannually, except that the first interest payable on the bonds or any series thereof may be for any period not to exceed one year as determined by the board.
In the resolution or resolutions providing for the issuance of bonds, the board may also provide for call and redemption of the bonds prior to maturity at times and prices and upon any other terms that it may specify. However, no bond is subject to call or redemption prior to maturity unless the bond contains a recital to that effect. The denomination or denominations of bonds shall be stated in the resolution providing for their issuance, but shall not be less than five thousand dollars ($5,000). The principal of, and interest on, the bonds shall be payable in lawful money of the United States at the office of the treasurer of the VTA or at any other place or places that may be designated by the board, or at either place or places at the option of the holders of the bonds. The bonds shall be dated, numbered consecutively, signed by the board chairperson and chief financial officer, and countersigned by the secretary and shall have the official seal of the VTA attached. The interest coupons of the bonds shall be signed by the chief financial officer. The seal and all signatures and countersignatures may be printed, lithographed, or mechanically reproduced, except that one signature or countersignature shall be manually affixed.
If an officer, whose signature or countersignature appears on the bonds or coupons, leaves office for any reason prior to the delivery of the bonds, the officer’s signature is as effective as if the officer had remained in office.
The bonds issued pursuant to this chapter may be sold as the board determines by resolution. The board may sell the bonds at a price below par.
If the board determines by resolution that the bonds shall be sold by competitive bid, the board, before selling the bonds, or any part thereof, shall give notice inviting sealed bids in the manner that it prescribes. If satisfactory bids are received, the bonds offered shall be awarded to the highest responsible bidder. If no bids are received, or if the board determines that the bids received are not satisfactory as to price or responsibility of the bidders, the board may reject all bids received, if any, and either readvertise or sell the bonds at private sale or by negotiation, or by other lawful means.
If the board determines by resolution that the bonds shall not be sold by competitive bid, the board may sell the bonds at public or private sale, by negotiation, or by other lawful means.
Delivery of any bonds issued under this chapter may be made at any place either inside or outside the state, and the purchase price may be received in cash or bank credits.
All accrued interest and premiums received on the sale of bonds issued by the VTA pursuant to this chapter shall be placed in the fund to be used for the payment of principal of, and interest on, those bonds. The remainder of the proceeds received on the sale of the bonds shall be placed in the treasury to secure those bonds or for the purposes for which the debt was incurred.
When the purposes for which the debt was incurred have been accomplished, any money remaining shall be either (a) transferred to the fund to be used for the payment of principal of, and interest on, the bonds or (b) placed in a fund to be used for the purchase of those outstanding bonds of the VTA, from time to time, in the open market at the prices and in the manner, either at public or private sale or otherwise, that the board determines. Bonds so purchased shall be canceled immediately.
The board may provide for the issuance, sale, or exchange of refunding bonds to redeem or retire any bonds issued by the VTA under this chapter upon the terms, at the times, and in the manner that it determines. Refunding bonds may be issued in a principal amount sufficient to pay all, or any part, of the principal of the outstanding bonds issued under this chapter, the interest thereon, and the premiums, if any, due upon call and redemption thereof prior to maturity and all expenses of the refunding.
The provisions of this chapter, for the issuance and sale of bonds apply to the issuance and sale of refunding bonds, except that, when refunding bonds are to be exchanged for outstanding bonds, the method of exchange shall be as determined by the board.
Any bonds issued under this chapter are legal investment for all trust funds; for the funds of insurance companies, commercial and savings banks, and trust companies; for state school funds; and, whenever any money or funds may, by any law now or hereafter enacted, be invested in bonds of cities, counties, school districts, or other districts within this state, the money or funds may be invested in the bonds issued under this chapter.
Whenever bonds of cities, counties, school districts, or other districts within this state may, by any law now or hereafter enacted, be used as security for the performance of any act or the deposit of any public money, bonds issued under this chapter may be so used.
The provisions of this chapter are in addition to all other laws relating to legal investments and are controlling as the latest expression of the Legislature with respect thereto.
The board may change the purposes for which any proposed debt is to be incurred, the estimated cost, the amount of bonded debt to be incurred, or the boundaries of the benefit district or zones, if any, therein or one or all of those matters, except that the board shall not change the boundaries of the benefit district or zones to include any territory which will not, in its judgment, be benefited by the VTA action.
The board shall not change the purposes, the estimated cost, the boundaries of the benefit district or zones, if any, therein, or the amount of bonded debt to be incurred until after it gives notice of its intention to do so, stating each proposed change in the purpose and stating, if applicable, that the exterior boundaries of the benefit district or zones proposed to be changed are set forth on a map on file with the secretary of the VTA. The notice shall also specify the time and the place set for hearing.
The notice shall be published prior to the time set for the hearing pursuant to Section 6066 of the Government Code.
The notice shall also be mailed at least 30 days prior to the hearing to all owners of real property affected by the proposed change whose names and addresses appear on the last equalized assessment roll or are otherwise known to the board of supervisors of the county in which the benefit district is located or to the VTA. Any proposed increases to a special benefit assessment shall not be made unless all notice, protest, and hearing procedures set forth in Section 53753 of the Government Code have been followed.
At the time and place fixed for a hearing on changes, or at any time and place to which the hearing is adjourned, the board shall proceed with the hearing. At the hearing, interested persons may appear and present matters material to the changes set forth in the notice.
At the conclusion of the hearing, the board shall, by resolution, determine whether to make any or all of the changes set forth in the notice. The determinations made in the resolution are conclusive and final.
All decisions and determinations of the board, upon notice and hearing, are final and conclusive upon all persons entitled to appeal to the board as to all errors, informalities, and irregularities which the board might have avoided or remedied during the progress of the proceedings or which it can, at that time, remedy.
Any objection, appeal, or protest not made at the time of any hearing is deemed to be waived voluntarily by any person who might have made the appeal, protest, or objection, and the person is deemed to have consented to the action taken following the hearing and any other matter on which objection, protest, or appeal could have been made.
Any action or proceeding which contests, questions, or denies the validity or legality of the formation of any benefit district or zone, the issuance of any bonds therefor pursuant to this chapter, or any proceedings relating thereto, shall be commenced within six months from the date of the formation; otherwise, the formation of the benefit district or zone, the issuance of the bonds, and all proceedings relating thereto shall be held to be in every respect valid, legal, and incontestable.
When the board has imposed a special benefit assessment, the secretary shall so certify to the assessor of the county in which the territory of any benefit district is located and deliver to the assessor copies of all maps and diagrams of the benefit district and zones, if any, therein, indicating the amount of the special benefit assessment to be levied within the benefit district and zones, if any, therein.
Special benefit assessments authorized by this chapter shall be levied and collected by the county at the same time and in the same manner as taxes are levied and collected. The county may deduct its reasonable expenses of collection and shall transmit the balance of the assessments to the authority.
In the event of conflict with any other law, the provisions of this chapter shall prevail with respect to benefit districts within the boundaries of the VTA.
Notwithstanding any other provision of this chapter, the VTA shall not pledge any portion of its general fund revenues to pay any part of any bonded indebtedness incurred under this chapter unless required by provisions of the California Constitution.
PART 13. GOLDEN EMPIRE TRANSIT DISTRICT [101000. - 101372.]
CHAPTER 1. Title of Act and Policy [101000. - 101001.]
This part shall be known and may be cited as the “Golden Empire Transit District Act.”
It appears that public interest and necessity may require that a transit district be established in the territory comprising the City of Bakersfield and the unincorporated area of the County of Kern adjacent to the city in order to meet the public transit problems within such territory. There is no general law under which such a district could be formed and, accordingly, the enactment of a special law providing for the formation of such a special district is required.
CHAPTER 2. Definitions [101005. - 101014.]
Unless the context otherwise specifically requires, the definitions set forth in this chapter shall govern the construction of this part.
“District” means the Golden Empire Transit District formed under the provisions of this part.
“Board” means the board of directors of the district.
“County” means the County of Kern.
“Board of supervisors” means the board of supervisors of the county.
“Voter” means any elector who is registered to vote under the provisions of the Elections Code and who resides within the territory proposed for formation of the district or within the territory comprising the district after its formation.
“Transit” means the transportation of passengers by any means and includes the transportation of the incidental baggage of passengers.
“Transit works” or “transit facilities” means any and all real or personal property, equipment, rights or interests acquired, constructed, leased, purchased, owned or otherwise operated by the district for transit purposes and including any future acquisition of any of the same in any manner.
“Commission” means the local agency formation commission, of the county.
“Existing system” means any transit service or system of a publicly or privately owned public utility, or division thereof, operating entirely within the district or at least 40 percent of whose revenue vehicle miles for the preceding calendar year were operated within the district, but does not include a charter-party carrier or the charter service of a passenger stage corporation.
CHAPTER 3. General Provisions [101030. - 101031.]
The Golden Empire Transit District may exercise the powers granted in this part.
The territory of such district shall be composed of the entire City of Bakersfield and such portions of unincorporated territory of the county contiguous thereto as may be benefited by inclusion in the district.
CHAPTER 4. Government of the District [101100. - 101173.]
ARTICLE 1. General [101100. - 101106.]
The government of the district shall be vested in a board of directors of five members.
Each director shall be a resident of the district. Members of the board of supervisors and members of the City Council of the City of Bakersfield shall not be eligible for appointment as members of the board.
Except for the first members of the board, the term of office of each director shall be four years commencing at noon on the first Monday following the first day of January and until the appointment and qualification of his successor.
The board of directors shall be appointed as follows:
Two members shall be appointed by the board of supervisors.
Two members shall be appointed by the City Council of the City of Bakersfield.
One member shall be appointed by majority vote of the other four members of the board.
If the majority of the four members of the board appointed pursuant to subdivisions (a) and (b) of Section 101103 fail to appoint the fifth member of the board within 30 days after the appointment of such four members, then the fifth member shall be appointed within 30 days thereafter by the majority vote of a conference committee composed of five members selected as follows: two members of the board of supervisors chosen by that board, two members of the City Council of the City of Bakersfield chosen by the council, and one member chosen by the majority of the four other members so appointed.
Within the 30 days next preceding the date of expiration of the term of any director, a successor shall be appointed to succeed the director whose term is expiring. The appointment shall be made by the body which is authorized, pursuant to Section 101103, to make the appointment of the particular class of director whose term is expiring.
ARTICLE 2. First Directors [101110. - 101111.]
The appointment of the first members of the board of directors shall be made within 30 days after the date of the formation of the district. The members shall take office immediately upon their appointment and qualification.
The one member of the first board appointed pursuant to subdivision (c) of Section 101103 shall hold office until noon on the first Monday following the first day of January in the second odd-numbered year following the year in which the district is formed.
Immediately upon their appointment and qualification, the remaining four members of the first board shall meet and classify themselves by lot so that:
One appointee of the board of supervisors and one appointee of the City Council of the City of Bakersfield shall hold office until noon on the first Monday following the first day of January in the first odd-numbered year following the year in which the district is formed.
One appointee of the board of supervisors and one appointee of the city council shall hold office until noon on the first Monday following the first day of January in the second odd-numbered year following the year in which the district is formed.
ARTICLE 3. Organization and Procedure [101120. - 101127.]
Immediately following the appointment and qualification of the first board of directors, and thereafter at the first meeting of the board following the first Monday after the first day of January of each year, the board shall elect a chairman and a vice chairman.
The chairman shall preside at all meetings of the board. He shall perform such other functions as delegated to him under this part or under any regulation prescribed by the board. The chairman may move or second any motion, and shall vote upon all orders, resolutions, or ordinances passed upon by the board.
In the absence of the chairman at any meeting, the vice chairman shall preside. In the event of the inability of the chairman to perform the functions of his office, such functions shall be performed by the vice chairman with the same force and effect as the performance of such functions by the chairman.
A majority of the members of the board shall constitute a quorum for the transaction of business. The adoption of any minute order, resolution, or ordinance shall require the affirmative votes of at least three members of the board.
The acts of the board shall be expressed by minute order, resolution, or ordinance. District ordinances shall be adopted by the board in substantially the same manner as prescribed for the adoption of county ordinances by the board of supervisors.
By resolution or ordinance, the board shall prescribe the time and place of the regular meetings of the board. All meetings of the board shall be held in compliance with the terms of the Ralph M. Brown Act (Chapter 9 (commencing with Section 54950), Part 1, Division 2, Title 5 of the Government Code).
In any particular not otherwise provided for by this part, the board, by resolution or ordinance, may prescribe any regulation which it may deem appropriate for the proper conduct of the internal functions of the board.
Except as otherwise provided in Section 101304, whenever the signature of any officer or employee of the district is authorized or required under the provisions of this part, the signature may be made by the use of a plate or stamp bearing a facsimile of the signature, or such signature may be reproduced by any other facsimile method authorized by law.
ARTICLE 4. Compensation and Expenses [101130. - 101131.]
Each member of the board shall receive a per diem compensation for his services for each day, or portion thereof, in which he is in attendance at meetings of the board. The amount of the compensation shall be fixed by the board, but shall not exceed fifty dollars ($50) for each day’s attendance. In no event shall the total compensation received by any member of the board in any one calendar month exceed the sum of one hundred dollars ($100).
In addition to the compensation provided for in Section 101130, each member of the board shall receive reimbursement for his actual and necessary traveling expenses incurred in the discharge of his official duties when such travel is beyond the territory of the district and when such travel is first approved by the board.
ARTICLE 5. Vacancies [101135. - 101136.]
Any vacancy in the membership of the board shall be filled for the unexpired term of the member whose office has become vacant, and shall be made by appointment by the body which is authorized, pursuant to Section 101103, to make the appointment of the particular class of director whose office has become vacant.
The appointment to fill a vacancy shall be made within 30 days after the creation of the vacancy. In the event the vacancy is in the class of member provided for in subdivision (c) of Section 101103, and if the remaining members of the board fail to fill the vacancy within that time, then, within 30 days thereafter, the vacancy shall be filled by the majority vote of a conference committee composed of five members selected as follows: two members of the board of supervisors chosen by that board, two members of the City Council of the City of Bakersfield chosen by the city council, and one member chosen by the majority vote of the four members so selected.
ARTICLE 6. Removal From Office [101140. - 101141.]
Any member of the board may be removed at any time and without cause by the body which is authorized, pursuant to Section 101103, to make the appointment of the particular class of director who is removed.
ARTICLE 7. Powers and Duties of Directors [101150. - 101154.]
All matters and things necessary for the proper administration of the affairs of the district which are not provided for by this part shall be provided for by the board. The powers vested in the board by this part shall be deemed to be inclusive but not exclusive.
The board shall supervise and regulate every transit facility owned and operated or controlled by the district, including the fixing of rates, rentals, charges and classifications, and the making and enforcement of regulations, contracts, practices, and schedules for, or in connection with, any transit facility owned or controlled by the district.
The board may either itself operate the transit system, or any part thereof, or it may contract with any other public or private agency or corporation to operate all, or any part, of the transit system for the district, or it may contract with any other public or private agency or corporation for the improvement in transit services, facilities, equipment, or operations being operated and conducted by such agency or corporation, and all of the same either within the district, outside the district, or both.
The board may contract with the governing body of any school district, and the governing board of any school district may contract with the board, for the transportation by any transit facility of the transit district of any pupils in attendance at any school maintained and operated by any such school district lying either in whole or in part within the transit district created under this part.
The board may, from time to time, contract for or employ any professional service required by the district and may, from time to time, contract for or employ any other person necessary to perform any other work or service which cannot be satisfactorily performed by the regular employees of the district.
ARTICLE 8. Other Officers [101160. - 101173.]
Prior to the time the district has operated, controlled, or used transit facilities, or any part thereof, for the transportation of passengers under the provisions of this part for a period of six months, the board may, but is not required to, appoint a general manager. A general manager appointed during such time shall hold office at the pleasure of the majority of the board.
After the district has operated, controlled, or used transit facilities, or any part thereof, for the transportation of passengers under the provisions of this part for a period of six months, the board shall forthwith appoint a general manager.
All other things being equal, the board shall appoint as general manager a person who has had experience in the acquisition, construction, or management of transit facilities.
Except as otherwise provided in this part, and subject to the policies established by the board, the general manager shall have the responsibility and the authority for the proper administration of the affairs of the district and the maintenance and operation of the transit facilities of the district.
The general manager may be removed from office by resolution. Before the general manager may be removed, he shall, if he so demands, be given a written statement of the grounds for his removal, and he shall have the right to be publicly heard thereon at a meeting of the board prior to the final vote on the resolution providing for his removal. Pending and during such hearing, the board may suspend him from office, and without payment of salary, for a period of not to exceed 30 days. The board may not reduce the salary of the general manager below the amount currently being received by him, except upon the adoption of a resolution after a like opportunity to be publicly heard. The action of the board in suspending or removing the general manager, or reducing his salary, is final.
The board shall appoint a secretary and an attorney to serve as legal counsel to the district. These officers shall serve at the pleasure of the board.
If the moneys of the district, or any part thereof, are deposited in a depositary other than the county treasury, the board shall appoint a treasurer who shall be responsible for the safekeeping and disbursing of all district moneys and funds held by him. The treasurer shall serve at the pleasure of the board.
No member of the board of directors, and no county or city officer or employee of the county or a city located within the county, shall be eligible for appointment to any of the offices provided for in this article.
The board may consolidate any of the district offices provided for by this article.
The treasurer of the district, if one is appointed by the board, shall give bond for the faithful performance of his or her duties. The board may require any other officer to give a similar bond. The amount of each bond shall be fixed by the board. All bonds shall be approved by the board and shall be recorded in the office of the county recorder and filed in the office of the clerk of the district.
The secretary shall maintain and preserve a permanent written record of all of the official acts of the board as evidenced by minute order, resolution, or ordinance.
The board shall fix the compensation of the officers provided for in this article.
The premium upon any bond required under this article is a charge against the district.
CHAPTER 5. General Powers and Functions of the District [101175. - 101208.5.]
ARTICLE 1. Corporate Power [101175. - 101179.]
The district has perpetual succession and may adopt a seal and alter it at pleasure.
Except as otherwise provided by law, the district may sue and be sued in all courts and tribunals of competent jurisdiction.
The district may exercise the right of eminent domain to take any property necessary or convenient to the exercise of the powers granted in this part. In the exercise of such power, in addition to the damage for the taking, injury, or destruction of property, the district shall also pay the cost of removal, reconstruction, or relocation of any railways, mains, pipes, conduits, cables, poles, or other structures or facilities of any public utility or public agency which is required to be moved to a new location.
No action in eminent domain to acquire property, or any interest therein, shall be commenced unless the legislative body of the city, as to property which is located within such city, or the board of supervisors, as to property which is located within the unincorporated territory, has consented by resolution to such acquisition.
No such taking or acquisition by the district which would involve the abandonment, removal, relocation, or use of the property of a railroad corporation, as defined in Section 230, shall be permitted, unless the Public Utilities Commission, after hearing, shall find and determine that the public interest and necessity require the abandonment, removal, relocation, or use of such property and that such taking or acquisition will not unreasonably impair the ability of the railroad corporation involved to provide safe, adequate, economical, and efficient service.
ARTICLE 2. Contracts [101180. - 101181.]
The district may make contracts and enter into stipulations of any nature whatsoever, either in connection with eminent domain proceedings or otherwise, including, without limiting the generality of the foregoing, contracts and stipulations to indemnify and save harmless, to engage labor or services, and to do all acts necessary and convenient for the full exercise of the powers granted in this part.
No officer or employee of the district shall in any manner be interested, directly or indirectly, in any contract awarded or to be awarded by the board, or in the profits to be derived therefrom, contrary to the provisions of Article 4 (commencing with Section 1090), Chapter 1, Division 4, Title 1 of the Government Code.
ARTICLE 4. Property [101190. - 101191.]
The district may take by grant, purchase, gift, devise, or lease, or condemn in proceedings under eminent domain, or otherwise acquire, and hold and enjoy, real and personal property of every kind within or outside the district and necessary to the full or convenient exercise of its powers. The board may lease, mortgage, or otherwise encumber, or sell, or otherwise convey or dispose of, any real or personal property within or outside the district when, in its judgment, it is for the best interests of the district to do so.
Whenever the board by resolution determines that any record, map, book, or paper which has been in the possession of the district, or any officer or employee thereof, for more than five years is of no further value to the district, the board may authorize its sale, destruction, or other disposition. This section shall not apply to the permanent records of the secretary as provided for in Section 101171, unless such written records are first transferred to microfilm or other miniature or electronic reproduction for permanent preservation.
ARTICLE 5. Transit Facilities and Service [101195. - 101206.]
The district may acquire, construct, own, operate, control, or use rights-of-way, rail lines, buslines, stations, platforms, switches, yards, terminals, and any and all other facilities necessary or convenient for transit service within or partly outside the district, underground, upon, or above the ground and under, upon, or over public streets or other public ways or waterways, together with all physical structures necessary or convenient for the access of persons and vehicles thereto, and may acquire any interest in, or rights to, the joint use of any or all of the foregoing; provided, that installations in any street, road, or other property devoted to a public use shall be subject to consent of the governing body in charge of such public use.
The district may, without limitation by any other provisions of this part requiring approval of indebtedness, accept contributions of money, rights-of-way, labor, materials, and any other property for the acquisition, construction, maintenance, and operation of transit facilities, and may, without limitation by any other provisions of this part, enter into any contracts and cooperation with, and accept cooperation from the United States, the state, or any department, instrumentality, or agency thereof, or any public agency in the acquisition, construction, maintenance, and operation of, and in financing the acquisition, construction, maintenance, and operation of, any such transit facilities.
The district shall not interfere with, or exercise control over, any transit facilities now or hereafter owned and operated wholly or partly within the district by any city or public agency, unless by consent of such city or public agency and upon such terms as are mutually agreed upon between the board and such city or public agency.
The district may lease, or contract for the use of, its transit facilities, or any portion thereof, to any operator, and may provide for subleases by such operator upon such terms and conditions as it deems in the public interest. The word “operator” as used in this section means any city or public agency or any person, firm, or private corporation.
The district may construct and operate or acquire and operate works and facilities in, under, upon, over, across, or along any street or public highway or any stream, bay, or watercourse, or over any of the lands which are the property of the state, to the same extent that such rights and privileges appertaining thereto are granted to municipalities within the state, and to install adequate bus stops, including the painting of curbs, subject to the governing body in charge of such streets, highways, stream, watercourse, or lands.
The district may enter into agreements for the joint use of any property and rights by the district and any city, public agency, or public utility operating transit facilities and may enter into agreements with any city, public agency, or public utility operating any transit facilities, either wholly or partially within or outside the district, for the joint use of any property of the district or of such city, public agency, or public utility, or the establishment of through routes, joint fares, transfer of passengers, or pooling arrangements.
The rates and charges for service furnished by the district shall be fixed by the board and shall be reasonable.
The board of supervisors, or the city council of a municipality having territory located within the district, may file a request for a hearing before the district board as to the reasonableness of any rates or charges fixed by the district and as to any proposal for fixing the location of facilities by the district. The request shall be in writing, and shall state the subject matter on which a hearing is desired.
Upon the filing of a request for hearing as provided for in Section 101202, the district board shall fix the time and place for hearing. The time fixed shall be not less than 20 days nor more than 60 days from the date such request is filed. Notice of such hearing shall be given by mail to the city or county requesting such hearing and to each local agency lying either in whole or in part within the district. Such mailing shall be completed not later than the 15th day before the date fixed for the hearing. Notice of the hearing shall be published by the district pursuant to Section 6066 of the Government Code. The first publication shall be made not sooner than the 30th day and not later than the 15th day before the date fixed for the hearing.
As used in this section, “local agency” means the county, an incorporated city, and a special district, including a school district.
Prior to, or at the time fixed, for hearing, the board of supervisors, or any city council eligible to file a request for hearing, and not a party to the original request for hearing, may intervene by filing a written notice of intervention with the secretary of the district. Any such intervener shall be entitled to be heard and introduce evidence.
Within 30 days after submission of the case, the board shall render its decision and its decision shall be final.
The district may operate charter bus service subject to the following limitations:
No bus equipment which is designed solely for charter service shall be purchased. A bus equipped with a toilet or underfloor baggage compartment shall be deemed charter equipment.
The board shall hold a public hearing prior to adopting a charter rate schedule or any amendment thereof. Notice of the hearing shall be mailed to each charter-party carrier operating within the district at least 30 days prior to the hearing. The notice shall include the proposed charter rate schedule. At the close of the public hearing, the board may adopt charter rate schedules which shall not be less than the average for the three largest private charter-party carriers operating similar service in the district.
Charter service shall originate and terminate within the area served by the district, unless a private charter-party carrier requests the district to provide service beyond the area served by the district.
ARTICLE 6. Existing Systems [101208.1. - 101208.5.]
Notwithstanding any other provision of this part, before the district may establish any transit service or system which may at any time divert, lessen, or compete for the patronage or revenues of any existing system, the district shall give a written notice to the public utility which is operating the existing system. The written notice shall describe the transit service or system which the district proposes to establish and shall state the time within which the district proposes to establish such service or system.
The district shall not establish the proposed service or system, or maintain and operate the service or system, until it has completed the purchase of the existing system or any part thereof.
The purchase price to be paid for the existing system, or any portion thereof to be purchased, shall be the reproduction cost new, including going concern value, at the date upon which the district commences negotiations for the purchase of the existing system, or the portion of the existing system, less depreciation, including wear, tear, and obsolescence, if any.
The district and public utility operating the existing system may agree upon the purchase price or they may agree that the purchase price is to be established by arbitration and upon the method of naming arbitrators and the method of conducting such arbitration.
Section 851 shall not apply to any contract for sale or sale of an existing system, or any portion thereof, pursuant to this article, and the Public Utilities Commission shall have no jurisdiction with respect thereto.
CHAPTER 6. General Financial Provisions [101210. - 101260.]
ARTICLE 1. Deposit and Withdrawal of Funds [101210. - 101216.]
To facilitate the business of the district, the board may provide for the creation and administration of such funds as the needs of the district may require and may transfer moneys and credits from one fund to another as the public interest requires. The board may provide for the deposit of the moneys of the district in any depository authorized by law to receive the deposit of public funds. The moneys so deposited shall be disbursed in accordance with regulations established by the board, and all payments from any fund shall be reported to the board.
Whenever the moneys of the district, or any part thereof, are deposited in a depositary other than the county treasury, all withdrawals of funds shall be made by check or warrant of the district signed by the treasurer of the district. All such withdrawals in payment of demands against the district shall be paid in accordance with such regulations as the board shall establish.
The board may designate the county treasury as the depositary, and in such case the county treasurer shall have custody of all, or any portion, of the moneys of the district.
If the county treasury is designated as the depositary, the county treasurer shall:
Receive and receipt for all of the district’s moneys received by him and place it in the county treasury to the credit of the district.
Be responsible upon his official bond for the safekeeping and disbursing of all district moneys and funds so held by him.
When the county treasury has been designated as the depositary, the county treasurer shall have the custody of the district’s moneys and funds, and he shall pay out the same, or any portion thereof, only upon the warrant of the county auditor. The county auditor shall draw his warrants to pay demands against the district.
The board shall examine, settle, and allow all accounts legally chargeable against the district, and shall order checks or warrants to be drawn in payment thereof by the treasurer of the district, or by the warrant of the county auditor upon the county treasury, as the case may be.
The board may provide by resolution, under such terms and conditions as it sees fit, for the payment of demands against the district without the prior specific approval thereof by the board, if the demand is for the purpose for which an expenditure has been previously approved by the board and is in an amount no greater than the amount so authorized and the demand is approved by the general manager.
ARTICLE 2. Indebtedness [101220. - 101223.]
The district may borrow money for the purpose of defraying the expenses of the district lawfully incurred after the commencement of the fiscal year, but prior to the time moneys from the tax levy for the fiscal year are received by the district, in a sum which shall not exceed fifteen cents ($0.15) on each one hundred dollars ($100) of assessed valuation of taxable property in the district at the time the moneys are borrowed, and may evidence such borrowing by notes bearing interest at a rate not to exceed 7 percent per annum. The notes shall be payable from the tax levy from the then current fiscal year, which levy shall contain a sum sufficient to provide for the payment of the notes and the interest thereon. The form of the notes, and the proceedings relating to their issuance and sale, shall be governed by the applicable provisions contained in Article 7 (commencing with Section 53820), Chapter 4, Part 1, Division 2, Title 5 of the Government Code.
The board may, within a period of two years from and after the formation of the district, pursuant to a resolution adopted by it for the purpose, borrow money on certificates of indebtedness, promissory notes, or other evidences of indebtedness, in anticipation of the estimated tax revenue for the following fiscal year, to be repaid within four years from the date of borrowing with interest at a rate not to exceed 7 percent per annum, in order to enable the district to meet all of its necessary initial expenses of organization, construction, acquisition, maintenance, and operation. The total amount of money borrowed and indebtedness incurred under this section during this two-year period shall not exceed 50 percent of the total amount of estimated tax revenue as estimated by the county auditor for the following fiscal year.
The form of the notes, and the proceedings relating to their issuance and sale, shall be governed by the applicable provisions contained in Article 7 (commencing with Section 53820), Chapter 4, Part 1, Division 2, Title 5 of the Government Code.
The district may accept, without limitation by any other provisions of this part requiring approval of indebtedness, contributions or loans from the United States, this state, or any department, instrumentality, or agency of either thereof, for the purpose of financing the acquisition, construction, maintenance, and operation of transit facilities, and may enter into contracts and cooperate with, and accept cooperation from, the United States, this state, or any department, instrumentality, or agency of either thereof, in the acquisition, construction, maintenance, and operation, and in financing the acquisition, construction, maintenance, and operation of any such transit facilities in accordance with any legislation which Congress or the Legislature of the State of California may have theretofore adopted or may hereafter adopt, under which aid, assistance, and cooperation may be furnished by the United States or this state in the acquisition, construction, maintenance, and operation, or in financing the acquisition, construction, maintenance, and operation, of any such transit facilities. The district may do any and all things necessary in order to avail itself of such aid, assistance, and cooperation under any federal or state legislation now or hereafter enacted. Any evidence of indebtedness issued under this section shall constitute a negotiable instrument.
The authority to incur indebtedness vested in the district by the provisions of this article shall be in addition to any right vested in it to receive a temporary transfer of funds pursuant to the last paragraph of Section 6 of Article XVI of the California Constitution.
ARTICLE 3. Investments [101230. - 101234.]
The district may invest any surplus money in its treasury, including money in any sinking fund, in any of the following:
Its own bonds.
Treasury notes, certificates of indebtedness, bills, bonds of the United States, or any other evidence of indebtedness secured by the full faith and credit of the United States.
Obligations issued pursuant to the Federal Home Loan Bank Act or the National Housing Act.
Treasury notes or bonds of this state, or of any public corporation, municipal corporation, public district, or political subdivision within this state which are legal as security for the deposit of public funds.
Such investment may be made by direct purchase of any issue of such bonds, treasury notes, or obligations, or part thereof, at the original sale or by the subsequent purchase of the bonds, treasury notes, or obligations.
Any bonds, treasury notes, or obligations purchased and held as investments by the district may, from time to time, be sold and the proceeds reinvested in bonds, treasury notes, or obligations as provided in this article.
Sales of any bonds, treasury notes, or obligations purchased and held by the district shall, from time to time, be made in season so that the proceeds may be applied to the purposes for which the money with which the bonds, treasury notes, or obligations were originally purchased was placed in the treasury of the district.
With the consent of the board, the general manager may:
Authorize the trust department of any state or national bank in this state, or a trust company authorized to act as such in this state, to receive as his agent deposits of any securities acquired by the district.
Place and maintain for safekeeping as a trust deposit with the trust department of any state or national banks in this state, or a trust company authorized to act as such in this state, any securities owned by the district.
The bank or trust company selected shall have a total paid-in capital of at least one million dollars ($1,000,000). The general manager shall take from the trust department or trust company a receipt for the securities, and neither the general manager nor the district is responsible for the custody and safe return of the securities until they are withdrawn from the trust department or trust company by the general manager. Any trust department or trust company to which securities are delivered, either as agent or depository for the district, shall make such disposition of the securities as the general manager directs and is responsible only for the strict compliance with written instructions given to it by the general manager. All such securities are at all times subject to the order of the general manager.
ARTICLE 4. Audits and Financial Report [101240. - 101245.]
The general manager shall cause to be installed and maintained a system of auditing and accounting which shall completely and at all times show the financial condition of the district.
The fiscal affairs of the district shall be predicated upon a fiscal year commencing on the first day of July of each calendar year and terminating on the 30th day of June of the following calendar year.
Within 90 days from and after the close of each fiscal year, the general manager shall prepare and file with the secretary of the district a financial report showing the result of the operations of the district for the preceding fiscal year and the financial status of the district on the last day thereof.
A copy of the financial report shall be kept in the office of the general manager and shall be available to public inspection at all times during the regular office hours of his office.
Within 15 days after the filing of the financial report, the general manager shall publish a notice of such filing and shall state the fact of such availability for public inspection, together with the address of the office of the general manager. Such publication shall be in accord with Section 6061 of the Government Code.
Within 15 days after the filing of the financial report, the general manager shall transmit a copy thereof to the board of supervisors and to the city council of each city within the district.
ARTICLE 5. Budget [101250. - 101256.]
On or before the 30th day prior to the end of each fiscal year, the general manager shall submit to the board a proposed budget covering all of the contemplated operations of the district for the following fiscal year. At that time a copy of the proposed budget shall be transmitted to the board of supervisors and to the city council of each city lying either in whole or in part within the boundaries of the district.
Prior to the time the board finally adopts the budget, it shall hold a public hearing upon the proposed budget submitted by the general manager. Notice of the time and place of hearing shall be published pursuant to Section 6061 of the Government Code and shall be made not later than the 15th day prior to the date of the hearing.
The date of the hearing shall be fixed by the board and shall be not later than July 1 of each year.
At the time and place designated in the published notice, the board shall meet and consider the proposed budget. Any resident of the district may appear and be heard regarding the increase, decrease, or omission of any item in the proposed budget or for the inclusion of new items. All proposals for the increase of any item or for the inclusion of any additional items shall be submitted in writing to the general manager before the close of the public hearing.
The board may continue the hearing from day to day; provided the hearing shall be concluded not later than July 15 first following its commencement.
After the conclusion of the hearing, and not later than August 1st of each year, and after making any revisions of the proposed budget which it may deem advisable either during or after the hearing, the board shall by resolution adopt the budget as finally determined by the board. Increases or additions shall not be made after the conclusion of the hearing, unless the items were proposed in writing and filed pursuant to Section 101253.
A copy of the budget as finally adopted by the board shall be filed with the county auditor pursuant to Section 53901 of the Government Code.
ARTICLE 6. Services of County and City Officers [101260. - 101260.]
Whenever the district avails itself of the services of any officer or department of the County of Kern, or of any city within the district, in the performance of any function of the district, the district shall reimburse the county or the city, as the case may be, for the reasonable value of any such service so performed in an amount, or at a rate of charge, to be fixed by the legislative body of the agency performing the service.
Reimbursement to the county for its services to the district in the collection of district taxes shall be subject to the limitation prescribed by Section 29142 of the Government Code.
CHAPTER 7. Taxation [101265. - 101274.]
The district may cause to be levied and collected taxes for any lawful purpose, subject to a maximum limit of fifteen cents ($0.15) per one hundred dollars ($100) of assessed valuation.
The maximum limit may be increased to twenty-five cents ($0.25) per one hundred dollars ($100) of assessed valuation, if approval is first obtained from the city council of each city lying entirely within the boundaries of the district and the board of supervisors.
The maximum limit may be increased above the maximum limits as specified in subdivisions (a) and (b), if such a maximum limit is first approved by the majority of the voters voting at any general or special election on the proposition establishing such a maximum limit.
If, in the opinion of the board, the transit operation revenues will not be sufficient to pay for any and all lawful purposes of the district, the board shall fix the amount of money necessary to be raised by taxation for any such purpose or purposes and shall cause a tax to be levied therefor.
Any tax so levied shall be subject to the limitations prescribed by Sections 101265 and 101267.
The board shall, in addition to the general tax levy as set forth in Section 101265, levy and collect annually until the district’s bonds are paid, or until there is a sum in the treasury of the district set apart for that purpose to meet all sums coming due for principal and interest on the bonds as they become due, a tax sufficient to pay the annual interest on the bonds and such part of the principal thereof as becomes due before the proceeds of a tax levied at the next general tax levy will be available. If the maturity of the indebtedness created by the issue of bonds begins more than one year after the date of the issuance thereof, the tax shall be levied and collected annually at the time and in the manner aforesaid, sufficient to pay the interest on the indebtedness as it falls due and to constitute a sinking fund for the payment of the principal on or before maturity.
On or before the second Monday in August of each year, the county auditor shall transmit to the board a statement in writing showing the total value of all property within the district referred to in Section 101270.
On or before the last Friday in July of each year, the board shall file with the board of supervisors and with the county auditor a statement in writing which shall contain the following:
An estimate of the amount of money required to be raised by taxation during the fiscal year for the payment of the principal and interest on any bonded indebtedness of the district.
An estimate of the amount of money required to be raised by taxation during the fiscal year for all other purposes of the district.
The statement shall be predicated upon the budget adopted pursuant to the provisions of Article 5 (commencing with Section 101250) of Chapter 6 of this part.
Annually at the time of levying county taxes, the board of supervisors shall levy a tax upon all the taxable real and personal property within the district. Subject to the maximum limits prescribed by Section 101265, the rate shall be such as will produce, after due allowance for delinquency and cost of collection, the amounts determined by the board of directors as necessary to be raised by taxation and as set forth in the statement required by Section 101269. The tax rate so levied shall apply to all the taxable real and personal property within the district as they appear on the assessment roll of the county.
The taxes so levied shall be collected at the same time and in the same manner as county taxes and, when collected, shall be paid into the county treasury for the use of the district, or to the treasurer of the district, as the case may be.
The performance of the acts provided for by this chapter shall constitute a valid assessment of the property within the district and a valid levy of the taxes so fixed.
All taxes levied under this part are a lien on the property on which they are levied and shall become a lien at the same time as county taxes. The enforcement of the collection of such taxes shall be in the same manner and by the same means provided by law for the enforcement of liens for county taxes, and all of the provisions of law relating to the enforcement of the latter are made a part of this part by specific reference so far as applicable.
Whenever any real property has been sold for taxes and has been redeemed, the money paid for redemption shall be apportioned and paid to the district treasurer, or deposited in the county treasury for the use of the district, as the case may be, in the proportion which the tax due to the district bears to the total tax for which the property was sold.
CHAPTER 8. Bonds [101280. - 101336.]
ARTICLE 1. Issuance [101280. - 101298.]
The district may, from time to time, incur a bonded indebtedness as provided in this chapter to pay the cost of acquiring, constructing, or completing the whole, or any portion, of any transit facilities, or for acquiring any works, lands, structures, rights, equipment, or other property necessary or convenient to carry out the objects, purposes, or powers of the district.
The district shall not incur a total bonded indebtedness which exceeds 5 percent of the assessed value of all the taxable real and personal property within the district.
Whenever the board, by resolution passed by vote of four-fifths of all its members, determines that the public interest or necessity demands the acquisition, construction, or completion by the district of any transit facilities or of any works, lands, structures, rights, equipment, or other property necessary or convenient to carry out the objects, purposes, or powers of the district, the cost of which will be too great to be paid out of the ordinary annual income and revenue of the district, it may, at any subsequent meeting of the board, provide by ordinance for the submission of the proposition of incurring a bonded indebtedness for the purpose set forth in the resolution to the voters of the district at a special bond election held for that purpose.
In lieu of a resolution passed by the board, proceedings for the issuance of bonds for the purposes provided in this chapter may be initiated by petition of the voters of the district.
The petition may be presented to the board, and shall be executed and attested in the same manner as provided a petition for the formation of the district in Article 2 (commencing with Section 101035) of Chapter 3 of this part.
Whenever any petition signed by voters within the district equal in number to at least 15 percent of the total vote cast within the district at the last general statewide election is presented to the board asking for the acquisition, construction, or completion of the whole, or any portion, of any transit facilities or for acquiring any works, lands, structures, rights, equipment, or other property necessary or convenient to carry out the objects, purposes, or powers of the district, and also asking that a bonded indebtedness be incurred to pay for the cost thereof, the secretary of the district shall forthwith transmit the petition to the county elections official for certification.
Within 30 days after the receipt of the petition, the county elections official shall examine the petition and determine the number of valid signers thereof by comparing the signatures thereon with the signatures of registered voters as appear on the affidavits of voter registration on file with him or her. The county elections official then shall certify to the secretary of the district all the following:
The total number of voters registered within the district at the time of the last general statewide election immediately preceding the filing of the petition.
The total number of registered voters of the district who have signed the petition.
The percentage which the number of such signers bears to the total number of voters registered to vote within the district at such time.
If the county elections official certifies that the percentage of registered voters signing the petition is less than that required by Section 101284, a supplemental petition may be presented to the secretary of the district within 30 days after the county elections official’s certification of the first petition. The supplemental petition shall thereupon be processed as provided in Sections 101284 and 101285.
If the petition has been executed in the manner provided and by the required number of signers, the secretary of the district shall forthwith transmit to the board and to the general manager a copy of the petition, but without the signatures appended thereto.
Upon receiving a petition so executed by the required number of signers, the board shall provide by ordinance for the submission of the proposition of incurring a bonded indebtedness for the purpose set forth in the petition to the voters of the district at a special bond election held for that purpose.
The ordinance calling a special bond election shall fix the date on which the election will be held, and the manner of holding the election and of voting for or against incurring the indebtedness. It shall also recite the objects and purposes for which the indebtedness is proposed to be incurred, the estimated cost of the transit facilities, works, lands, structures, rights, equipment, or other property proposed to be acquired, constructed, or completed, the amount of the principal of the indebtedness to be incurred therefor, and the maximum rate of interest to be paid on the indebtedness, which shall not exceed 7 percent per annum, payable semiannually or annually the first year and thereafter semiannually.
Propositions for incurring indebtedness for more than one object or purpose, or propositions proposed by resolution or petition, may be submitted at the same election.
The bond election may be held separately, or it may be held on the same day as any other state, county, or city election, or any election held under the Uniform District Election Law (Part 4 (commencing with Section 10500) of Division 10 of the Elections Code), and may be consolidated therewith.
If a special bond election is consolidated with any other election, the provisions of this article setting forth the procedure for the calling and holding of the special bond election shall be complied with, except that the ordinance calling the election need not set forth the election precincts, polling places, and officers of election who shall be the same as those set forth in the ordinance, notice, or other proceedings calling the election with which the special bond election is consolidated, and shall refer to the ordinance, notice, or other proceedings by number and title, or by other definite description.
The board shall cause the ordinance to be published in accord with Section 6061 of the Government Code; the publication shall be made not less than 30 and not more than 60 days prior to the day of the election. No other notice of the election need be given.
If the ordinance calling the election so provides, the election shall be conducted by the county elections official in accord with the manner of holding the election prescribed by the board pursuant to the provisions of Section 101289.
The board shall comply with Article 3 (commencing with Section 9160) of Chapter 2 of Division 9 of the Elections Code, the provisions of which are applicable to any bond election held pursuant to this article. In the event the election is not conducted by the county clerk, then whenever the words “county clerk” or “county elections official” appear in that article of the Elections Code, the words “secretary of the district” shall be substituted for the purposes of this article of this part. For the further purposes of this article, the following substitutions shall be made in all cases for the words set out in that article of the Elections Code: (a) “board of directors” in lieu of “board of supervisors”; and (b) “attorney for the district” in lieu of “district attorney or county counsel”.
The votes of a majority of all the voters voting on the proposition at the election are required to authorize the issuance of bonds under this article.
If the proposition submitted at a special bond election fails to receive the requisite number of votes, the board shall not, within six months after the election, hold another special election for the submission of a proposition of incurring a bonded indebtedness substantially the same as the proposition voted upon at the prior election, unless a petition, signed by voters within the district equal in number to at least 15 percent of the total vote cast within the district at the last general statewide election is filed with the board, requesting that the proposition, or a proposition substantially the same, be submitted at an election to be called for that purpose.
Any such petition may be presented in the same manner and shall be executed and attested and certified as provided in this article for a petition asking that a bonded indebtedness be incurred.
ARTICLE 2. Form and Content [101300. - 101304.]
If the board has appointed a treasurer of the district pursuant to Section 101166, then the word “treasurer” as used in this chapter shall refer to such treasurer of the district so appointed. If the board has not so appointed a treasurer of the district, then the word “treasurer” as used in this chapter shall refer to the county treasurer.
Bonds authorized by this chapter shall mature serially in amounts to be fixed by the board, except that payment shall begin not later than 10 years from the date thereof and shall be completed in not more than 50 years from that date.
The board may divide any issue of bonds authorized pursuant to this chapter into two or more series, and may fix different dates of issuance and different maturity dates for the bonds of each series. The bonds of each series shall mature serially in amounts to be fixed by the board, and the board shall fix a date not more than 10 years from the date of issuance of each series for the earliest maturity of such series, and shall fix a date not more than 50 years from the date of issuance of each series for the final maturity of such series.
Pending the actual issuance or delivery of bonds, a district may issue temporary or interim bonds, certificates, or receipts, of any denomination whatsoever, with or without coupon, and in such form as may be prescribed by the board, to be exchanged for definite bonds when ready for delivery.
The bonds shall be issued in such denominations as the board shall determine and shall be payable on the day and at the place or places fixed in the bonds, and with interest at the rate specified therein, payable semiannually or annually the first year and semiannually thereafter.
The board may, at any time prior to the issuance and sale of any bonds, provide for the call and redemption of any or all of the bonds on any interest payment date prior to their fixed maturity at not exceeding the par value and accrued interest plus a premium of not exceeding 5 percent upon the principal amount of the bonds, in which event the call price fixed by the board shall be set forth on the face of the bond. Notice of such redemption shall be published pursuant to Section 6066 of the Government Code. The first publication shall be not more than 60 and not less than 30 days prior to the date fixed for redemption. After the date fixed for such redemption, interest on the bonds thereafter shall cease.
The bonds shall be signed by the president of the board or by such officer of the district as the board shall by resolution authorize and designate for that purpose. They shall also be signed by the treasurer, and be countersigned by the secretary. The coupons of the bonds shall be numbered consecutively and be signed by the treasurer. All signatures and countersignatures, except one of the signatures or countersignatures on the bonds, may be printed, lithographed, or engraved. If any officer whose signature or countersignature appears on the bonds or coupons ceases to be such officer before the delivery of the bonds to the purchaser, the signature or countersignature is nevertheless valid and sufficient for all purposes as if he had remained in office until the delivery of the bonds.
ARTICLE 3. Issue and Sale [101310. - 101312.]
The bonds may be issued and sold for not less than their par value, but otherwise as the board determines. Before selling any bonds, or any part thereof, the board shall give notice inviting sealed bids in such manner as the board may prescribe. Such notice shall be published at least twice pursuant to a provision of Article 4 (commencing with Section 6060), Chapter 1, Division 7, Title 1 of the Government Code. If satisfactory bids are received, the bonds offered for sale shall be awarded to the highest responsible bidder. If no bids are received, or if the board determines that the bids received are not satisfactory as to price or responsibility of the bidders, the board may reject all bids received, if any, and either again give notice inviting bids or sell the bonds at private sale.
All premiums and accrued interest received on the sale of bonds shall be placed in the fund to be used for the payment of principal of and interest on the bonds. The remainder of the proceeds of the bonds shall be placed in the district treasury, or in the county treasury, as the case may be, to the credit of the proper fund, and shall be used exclusively for the objects or purposes for which the bonds were voted; provided that, when such objects and purposes have been accomplished, any moneys remaining shall be transferred to the fund to be used for the payment of principal of and interest on the bonds, and that, when all principal of and interest on the bonds shall have been paid, any balance of money then remaining shall be transferred to the general fund of the district.
In lieu of the immediate levy of a tax to pay the interest, or any part thereof, on any bonded indebtedness incurred in accordance with this chapter, the board may, in the estimate of the amount of money necessary to be raised by the bonds, include a sum sufficient to pay interest on all of the bonds, or part thereof, during the period of acquisition, construction, or completion, but for no period in excess of five years.
ARTICLE 4. Refunding [101315. - 101321.]
Whenever the board, by resolution passed by a vote of four-fifths of all its members, determines that the refunding of the whole, or any portion of, the bonded indebtedness will be of advantage to the district, the board may refund the bonded indebtedness, or any portion thereof, and issue refunding bonds of the district therefor.
The issuance of refunding bonds shall not be construed as the incurring or increase of an indebtedness within the meaning of this part, and the approval of the voters is not required for the issuance of refunding bonds. The board may provide for the call and redemption of any or all of the bonds on any interest payment date prior to their fixed maturity in the ordinance authorizing the issuance of the refunding bonds.
Except as otherwise provided, the provisions of this chapter shall substantially govern as to all matters pertaining to the issuance of refunding bonds, including and without limiting the generality of the foregoing, the form, execution, issuance, maturity, redemption, refunding, validation, the payment of interest from bond funds, and the status of the bonds as investments.
Refunding bonds shall bear interest at a rate not exceeding the interest rate on the refunded bonds, but payment of the refunding bonds shall begin not later than one year from the date thereof and be completed in not more than 40 years from that date.
The proceeds of the sale of refunding bonds shall be applied only to the purchase, or retirement at not more than par and accrued interest, or the call price, of the bonded indebtedness for which the refunding bonds were issued.
In lieu of selling refunding bonds and using the proceeds to purchase or retire the bonds to be refunded, the board may exchange refunding bonds at not less than par and accrued interest for the bonds so refunded.
Whenever outstanding bonds are refunded, they shall be surrendered to the treasurer of the district, or the county treasurer, as the case may be, who shall cancel them by endorsing on their face the manner in which the refunding was effected (whether by exchange or purchase, and the amount for which so purchased, if any) and by perforating through each bond and each coupon attached thereto the word “canceled” together with the date of cancellation.
ARTICLE 5. Status as Investments [101325. - 101326.]
All bonds, including refunding bonds, issued by a district are legal investments for all trust funds and for the funds of all insurance companies, banks, both commercial and savings, and trust companies, and for the State School Fund and for all sinking funds under the control of the State Treasurer. Whenever any money or funds may by law be invested in, or loaned upon the security of, bonds of cities, cities and counties, counties, or school districts, in the state, such money or funds may be invested in, or loaned upon the security of, the bonds of the district; and whenever bonds of cities, cities and counties, counties, or school districts by law may be used as security for the faithful performance or execution of any court or private trust or of any other act, bonds of the district may be so used.
All bonds of the district, to the same extent as bonds of any other municipality, are legal for use by any state or national bank or banks in the state as security for the deposit of funds of the state or of any county, city and county, city, municipality, or other public or municipal corporation within the state.
ARTICLE 6. Validation [101330. - 101330.]
An action to determine the validity of bonds, including refunding bonds, may be brought pursuant to Chapter 9 (commencing with Section 860), Title 10, Part 2 of the Code of Civil Procedure.
ARTICLE 7. Revenue Bonds [101335. - 101336.]
As an alternative procedure for the raising of funds, the district may issue bonds, payable from revenues of any facility or enterprise to be acquired or constructed by the district, in the manner provided by the Revenue Bond Law of 1941 (Chapter 6 (commencing with Section 54300), Part 1, Division 2, Title 5 of the Government Code), all of the provisions of which are applicable to the district.
The district is a local agency within the meaning of the Revenue Bond Law of 1941 (Chapter 6 (commencing with Section 54300), Part 1, Division 2, Title 5 of the Government Code). The term “enterprise” as used in the Revenue Bond Law of 1941 shall, for all purposes of this part, include transit facilities, and any and all parts thereof, and all additions, extensions, and improvements thereto, and all other facilities authorized to be acquired, constructed, or completed by the district. A district may issue revenue bonds under the Revenue Bond Law of 1941 for any one or more facilities or enterprises authorized to be acquired, constructed, or completed by a district or, in the alternative, may issue revenue bonds under the Revenue Bond Law of 1941 for the acquisition, construction, and completion of any one of such facilities. Nothing in this article shall prevent the district from availing itself of, or making use of, any procedure provided in this part for the issuance of bonds of any type or character for any of the facilities or works authorized hereunder, and all proceedings may be carried on simultaneously or, in the alternative, as the board may determine.
CHAPTER 9. Labor Provisions [101340. - 101348.]
Employees shall have the right to self-organization, to form, join, or assist labor organizations, to bargain collectively through representatives of their own choosing, and to engage in other concerted activities for the purpose of collective bargaining or other mutual aid or protection. It is declared to be in the public interest that the district shall not express any preference for one union over another.
Whenever a majority of the employees employed by the district in a unit appropriate for collective bargaining indicate a desire to be represented by a labor organization, the district, upon determining as provided in Section 101344 that the labor organization represents the employees in the appropriate unit, shall enter into a written contract with the accredited representative of the employees governing wages, salaries, hours, and working conditions. In case of a dispute over wages, salaries, hours, or working conditions, which is not resolved by negotiations in good faith between the district and the labor organization, the district and the labor organization may submit the dispute to the decision of the majority of an arbitration board, and the decision of the majority of the arbitration board shall be final.
The arbitration board shall be composed of two representatives of the district, and two representatives of the labor organization, and they shall endeavor to agree upon the selection of the fifth member. If they are unable to agree, the names of five persons experienced in labor arbitration shall be obtained from the California State Mediation and Conciliation Service. The labor organization and the district shall, alternately, strike a name from the list so supplied, and the name remaining after the labor organization and the district have stricken four names, shall be designated as the arbitrator. The labor organization and the district shall determine by lot who shall first strike from the list. The decision of a majority of the arbitration board shall be final and binding upon the parties. The expenses of arbitration shall be borne equally by the parties. Each party shall bear his or her own costs.
In the event the board and the representatives of the employees do not agree to submit the dispute to an arbitration board as provided in Section 101341, the State Conciliation Service may be notified by either party that a dispute exists and that there is no agreement to arbitrate. The State Conciliation Service shall determine whether or not the dispute may be resolved by the parties and, if not, the issues concerning which the dispute exists. Upon such determination, the State Conciliation Service shall certify its findings to the Governor of the State of California, who shall, within 10 days of receipt of certification, appoint a factfinding commission consisting of three persons which shall immediately convene and inquire into and investigate the issues involved in the dispute. The commission shall report to the Governor within 30 days of the date of its creation.
After the creation of such commission and for 30 days after such commission has made its report to the Governor, no change, except by mutual agreement, shall be made by the parties to the controversy in the conditions out of which the dispute arose and service to the public shall be provided.
A contract or agreement shall not be made, or assumed under this part, with any labor organization, association, or group that denies membership to, or in any manner discriminates against, any employee on any basis listed in subdivision (a) of Section 12940 of the Government Code, as those bases are defined in Sections 12926 and 12926.1 of the Government Code. However, the organization may preclude from membership any individual who advocates the overthrow of the government by force or violence.
The district shall not discriminate with regard to employment against any person on any basis listed in subdivision (a) of Section 12940 of the Government Code, as those bases are defined in Sections 12926 and 12926.1 of the Government Code, except as otherwise provided in Section 12940 of the Government Code.
If there is a question whether a labor organization represents a majority of employees or whether the proposed unit is or is not appropriate, such matters shall be submitted to the State Conciliation Service for disposition. The State Conciliation Service shall promptly hold a public hearing after due notice to all interested parties and shall thereupon determine the unit appropriate for the purposes of collective bargaining. In making such determination and in establishing rules and regulations governing petitions and the conduct of hearings and elections, the State Conciliation Service shall be guided by relevant federal law and administrative practice, developed under the Labor-Management Relations Act, 1947, as presently amended.
The State Conciliation Service shall provide for an election to determine the question of representation and shall certify the results to the parties. Any certification of a labor organization to represent or act for the employees in any collective bargaining unit shall not be subject to challenge on the grounds that a new substantial question of representation within such collective bargaining unit exists until the lapse of one year from the date of certification or the expiration of any collective bargaining agreement, whichever is later. However, no collective bargaining agreement shall be construed to be a bar to representation proceedings for a period of more than two years.
Whenever the district acquires existing facilities from a publicly or privately owned public utility, either in proceedings by eminent domain or otherwise, the district shall assume and observe all existing labor contracts. To the extent necessary for operation of facilities, all of the employees of such acquired public utility whose duties pertain to the facilities acquired shall be appointed to comparable positions in the district without examination, subject to all the rights and benefits of this part, and these employees shall be given sick leave, seniority, vacation, and pension credits in accordance with the records and labor agreements of the acquired public utility. Members and beneficiaries of any pension or retirement system or other benefits established by that public utility shall continue to have the rights, privileges, benefits, obligations, and status with respect to such established system. No employee of any acquired public utility shall suffer any worsening of his wages, seniority, pension, vacation, or other benefits by reason of the acquisition.
The district may extend the benefits of this section to officers or supervisory employees of the acquired public utility.
The district shall not acquire any existing system or part thereof whether by purchase, lease, condemnation, or otherwise, nor shall the district dispose of or lease any transit system or part thereof, nor merge, consolidate, or coordinate any transit system or part thereof, or reduce or limit the lines or service of any existing system or of its system, or terminate any lease arrangement or management contract, unless it shall first have made adequate provision for any employees who are or may be displaced. The terms and conditions of such provision shall be a proper subject of collective bargaining.
Notwithstanding the provisions of the Government Code, employees of the district may authorize and, upon such authorization, the district shall make deductions from wages and salaries of such employees:
Pursuant to a collective bargaining agreement with a duly designated or certified labor organization for the payment of union dues, fees, or assessments.
For the payment of contributions pursuant to any health and welfare plan or pension or retirement plan.
For any purpose for which deductions may be authorized by employees of any private employer.
The obligation of the district to bargain in good faith with a duly designated or certified labor organization and to execute a written collective bargaining agreement with such labor organization covering the wages, hours, and working conditions of the employees represented by such labor organization in an appropriate unit, and to comply with the terms thereof, shall not be limited or restricted by any provision of law. The obligation of the district to bargain collectively shall extend to all subjects of collective bargaining which are or may be proper subjects of collective bargaining with a private employer, including retroactive provisions.
CHAPTER 10. Retirement [101355. - 101359.]
At its discretion, the board shall select one of the following plans to provide retirement benefits to officers and employees of the district:
By contracting with the retirement system maintained pursuant to the County Employees Retirement Law of 1937 or the Public Employees’ Retirement Law.
By adopting a qualified plan and tax-exempt trust pursuant to Sections 401(a) and 501(a) of the Internal Revenue Code of 1954, as amended.
The adoption, terms, and conditions of any retirement system covering employees of the district represented by a labor organization shall be pursuant to the collective bargaining agreement between the labor organization and the district.
The board shall determine and classify the officers and employees who shall be eligible to participate in the retirement system. However, any action by the board shall be subject to the terms and regulations of a retirement system or plan selected by the board pursuant to subdivision (a) of Section 101356, and, in the case of employees of the district represented by a labor organization, subject to the collective bargaining agreement between the labor organization and the district.
The district and the labor organization representing the district’s employees in a bargaining unit shall be equally represented in the administration of the retirement system.
The retirement system provided for by this chapter shall not include the members of the board.
As to the members of the retirement system provided for by this chapter, the board may provide for their coverage under Title II of the Federal Social Security Act, as amended, and the related provisions of the Federal Insurance Contributions Act, as amended, and the district may perform all acts necessary or convenient to accomplish such coverage.
CHAPTER 11. Miscellaneous Benefits [101365. - 101366.]
The board shall provide for the coverage of the officers and employees of the district under the workers’ compensation, unemployment compensation disability, and unemployment insurance laws of the State of California.
Subject to such regulations and schedule of contributions of premiums as it shall determine, the board shall provide for group health and medical insurance for such officers and employees of the district who are members of the retirement system provided for by Chapter 10 (commencing with Section 101355) of this part and who request coverage under such insurance.
CHAPTER 12. Change of Organization [101370. - 101372.]
As used in this article the terms “change of organization” and “reorganization” shall have the meanings defined in Section 56021 and Section 56073, respectively, of the Government Code.
A change of organization or a reorganization of the district formed and existing under the provisions of this part may be effected in the manner prescribed by the District Reorganization Act of 1965 (Division 1 (commencing with Section 56000) of Title 6 of the Government Code), and the provisions of that act shall govern any and all such changes of organization or reorganizations.
Notwithstanding Section 101371, from and after the completion of the organization of the district on June 29, 1972, any territory lying outside of the boundaries of the district which is contiguous to and annexed to the City of Bakersfield shall be automatically included within the district upon the effective date of its inclusion within the city, subject only to compliance with the requirements of Chapter 8 (commencing with Section 54900), Part 1, Division 2, Title 5 of the Government Code.
PART 14. SACRAMENTO REGIONAL TRANSIT DISTRICT [102000. - 102700.]
CHAPTER 1. Title of Act and Policy [102000. - 102002.]
This part shall be known and may be cited as the “Sacramento Regional Transit District Act.”
The Legislature hereby finds and declares:
It is necessary that a transit district be established to operate a single unified public transportation system in the Sacramento region in order to meet the present and future public transportation, and mass and rapid transit, needs of that region. The existing Sacramento Transit Authority, because of its limited legal and financial base, is unable to solve the transit problems of the Sacramento region and provide the needed comprehensive public transportation system.
It is, therefore, necessary to provide a successor corporation to the authority, to wit: a transit district, and to provide for the formation of such transit district appointed by and responsive to the cities and counties in the Sacramento region served by the district so that there will be sufficient governmental authority to solve the existing and future transportation problems of the Sacramento region and provide the needed comprehensive public transportation system.
Because there is no general law under which such a district could be formed, the adoption of a special act enabling the creation of a special district is required.
It is the intent of the Legislature that the formation of this district shall further the concept of regional rapid transit and transit districts, with the eventual goal of the creation of a network of rapid transit systems throughout the state which would be operated as a single coordinated statewide system to facilitate the expeditious movement of people between the major metropolitan centers of the state.
CHAPTER 2. Definitions [102010. - 102028.]
Unless the context otherwise requires, the provisions of this chapter govern the construction of this part.
“District” means the Sacramento Regional Transit District.
“Transit” means the transportation of passengers and their incidental baggage by any means.
“Transit works” or “transit facilities” means any or all real and personal property, equipment, rights, or interests owned, or to be acquired, or used, by the district for transit service or purposes, including transit operations, maintenance, or administration. “Transit works” or “transit facilities” are public works for the purposes of the Public Contract Code.
“Board of directors”, “board”, and “directors”, means the board of directors of the district.
“City” means, individually, the Cities of Citrus Heights, Davis, Elk Grove, Folsom, Rancho Cordova, Roseville, Sacramento, West Sacramento, and Woodland, and any other city that is annexed to the district as provided in this part.
“County” means, individually, the Counties of Sacramento and Yolo, and any other county which is annexed, in whole or in part, to the district as provided in this part.
“Public agency” includes the State of California, and any county, city, district, or other political subdivision or public entity of, or organized under the laws of, this state, or any department, instrumentality, or agency thereof.
“System” means all transit works and transit facilities owned or held, or to be owned or held, or used, by the district for transit purposes.
“Revenues” means all rates, fares, tolls, rentals, or other income and revenue actually received or receivable by, or for the account of, the district from the operation of the system, including, without limiting the generality of the foregoing, interest allowed on any moneys or securities, any profits derived from the sale of any securities, and any consideration in any way derived from any properties owned, operated, or at any time maintained by the district.
“Person” includes any individual, firm, partnership, association, corporation, limited liability company, trust, or business trust, or the receiver, trustee, or conservator for any thereof, but does not include a public agency, as defined in Section 102017.
“Establish” includes establish, construct, complete, acquire, extend, or reroute. It does not, however, include the maintenance and operation of any existing system acquired by the district.
“Sacramento Area Council of Governments” means that agency or any successor thereto.
“Tax or financial support” includes funds made available pursuant to the “Mills-Alquist-Deddeh Act” (Chapter 4 (commencing with Section 99200) of Part 11 of Division 10), which is also known as the Transportation Development Act, or any successor to that act.
“Member entity” means a city or county that is within the boundaries of the district as defined in Section 102052.5.
“Participating entity” means a city or county that has entered into an agreement with the district pursuant to subdivision (b) of Section 102100.2, but only during the period in which the agreement is in effect. “Participating entities” means all those cities and counties.
“Voting entity” means a member entity or a participating entity. “Voting entities” means all member entities and participating entities.
“Transportation planning agency” shall have the meaning provided in Section 99214.
CHAPTER 3. Creation of District and Annexation [102050. - 102056.]
The Sacramento Regional Transit District may be formed pursuant to this chapter to carry out the purposes of this part. The district is hereby designated a rapid transit district. The district shall be a public corporation for those purposes.
The district may comprise any city within the boundaries of the County of Sacramento, the Cities of Davis, Roseville, West Sacramento, and Woodland, and the following described territory of the Counties of Sacramento and Yolo, to the extent the territory is not included in the above-mentioned cities:
That portion of the territory within the boundaries of the County of Sacramento that is within the urban service area of the County of Sacramento, as adopted and as hereafter amended, and any other portion of the unincorporated territory within the boundaries of the County of Sacramento where the county has declared a need for the district to operate.
The unincorporated territory of the County of Yolo that may be included is described as follows:
Beginning at the northeast corner of Sec. 36, T. 9 N., R. 3 E., M.D.B. & M.; thence north 12 mile along the west line of Sec. 30, T. 9 N., R. 4 E., to the west 14 corner of Sec. 30; thence east12 mile to the center of Sec. 30; thence north 18 mile, more or less, to the north line of Swamp Land Survey No. 970, the point being on the centerline of Tule Lake Road; thence northeasterly along the north line of Swamp Land Survey No. 970 to the centerline of the Sacramento River; thence easterly and southerly down and along the Sacramento River to the south line of Swamp Land Survey No. 815; thence northwesterly along the south line of Swamp Land Survey No. 815 to its southwest corner; thence northeasterly along the west line of Swamp Land Survey No. 815 to a point where it is intersected by the quarter section line running east and west through Sec. 30, T. 8 N., R. 4 E.; thence west 34 mile, more or less, to the east 14 corner of Sec. 25, T. 8 N., R. 3 E.; thence north 512 miles, more or less, to the point of beginning.
Beginning at the intersection of State Highway Route 113 and the Yolo County line southern boundary; thence easterly along the Yolo County line southern boundary to the Davis City Limits; thence meandering along the Davis City Limits to Russell Boulevard; thence westerly along Russell Boulevard to Route 113; thence southerly along Route 113 to the point of beginning.
For purposes of this section, any reference to an avenue, boulevard, highway, railroad, road, or street includes the right-of-way thereof.
The district shall be formed upon the adoption of a resolution by the City Council of the City of Sacramento and the adoption of a resolution by the Board of Supervisors of the County of Sacramento declaring there is a need for the district to function.
The boundaries of the district shall include all of the following:
The City of Sacramento.
The City of Rancho Cordova.
The unincorporated territory of the County of Sacramento that is within the urban service area, as determined by the Board of Supervisors, and not otherwise divided from the rest of the unincorporated territory that is within the urban service area by an incorporated city not previously described in this subdivision.
A city incorporated on or after January 1, 2016, which city consists entirely of territory that was included in the district before the city’s incorporation.
The boundaries of the district shall not be affected by the incorporation of any territory wholly or partly within the boundaries of the district or by reason of annexation to or detachment from any city or territory wholly or partly within the boundaries of the district, except as provided in this section.
Where territory outside the district is annexed to any city included in the district, that territory shall, upon the completion of the annexation proceeding, be deemed incorporated into and annexed to the district.
Where territory is incorporated as a new city, on or after January 1, 2016, and is partly within and partly outside the district, the entire territory shall, upon completion of the incorporation proceeding, be deemed incorporated into and annexed to the district.
Where territory that is within the boundaries of the district is annexed to any city that is not a member entity, that territory shall remain part of the district unless, at the time of annexation, both of the following apply:
No transit service is operated by the district within the annexed territory or within one-half mile of any outside boundary of the annexed territory.
No transit service is planned by the district, as evidenced by the district’s adopted short-range transit plan, for the annexed territory or within one-half mile of any outside boundary of the annexed territory within five years of the annexation, in which case that territory may be detached from the district if the Sacramento County Local Agency Formation Commission determines, during the annexation proceedings, that the area would be better served by the annexing city than the district. The detachment may be accomplished without proceeding with the detachment process in Section 102056.
Whenever territory is deemed incorporated into and annexed to the district pursuant to this section, that territory shall be subject to taxation, in accordance with the assessable valuation of the property in that territory for general district purposes and for payment of any indebtedness previously or thereafter incurred by the district.
The district may operate and exercise the powers under this part within any city, provided that the district shall have no power to levy an ad valorem property tax within the boundaries of any city that is not within the boundaries of the district as defined in Section 102052.5.
The district may operate and exercise the powers under this part within all or a part of the unincorporated area of any county, provided that the district shall have no power to levy an ad valorem property tax within the unincorporated area that is not within the boundaries of the district as defined in Section 102052.5.
Any city or county authorized to join the district pursuant to Section 102051 may be annexed to the district in the manner provided in this section.
Annexation shall only be effective if the legislative body of the city or county that requests to be annexed to the district agrees in writing with the board of directors upon the terms and conditions of annexation, which agreement, among other things, may provide for any of the following:
The levy and collection of special taxes within the city or unincorporated area of the county in addition to the taxes otherwise provided for in this part.
The fixing of rates, rentals, and charges differing from those fixed or existing elsewhere within the district.
The incurring or assumption of indebtedness.
The making of a payment or payments.
The transfer of property, real and personal, and other assets to the district by the city or county.
Territory within the district may be detached from the district by a supermajority vote of the board of directors, which shall be at least 67 percent of the nonweighted vote of the existing board, and by a majority vote of the governing body of the territory proposed to be detached, provided that the detached territory shall not be relieved from liability for taxation for the payment of any bonded indebtedness existing at the time of detachment, and provided that all other pending legal and financial obligations have been resolved by mutual agreement.
The detachment of territory from the district shall become effective upon giving of the notice required in Section 57204 of the Government Code.
Notice of the detachment of territory from the district shall be given to each assessor whose roll is used for a tax levy made pursuant to this part and to the State Board of Equalization pursuant to Chapter 8 (commencing with Section 54900) of Part 1 of Division 2 of Title 5 of the Government Code.
CHAPTER 4. Government of District [102100.1. - 102180.]
ARTICLE 1. Board of Directors [102100.1. - 102107.]
Except as otherwise provided, the government of the district shall be vested in a board of directors. The number of members on the board shall be not less than the number of voting entities.
Each appointee to the board shall serve a four-year term, unless earlier removed.
The board of directors shall consist of members as follows:
The City Council of the City of Sacramento may appoint three members to the board.
The Board of Supervisors for the County of Sacramento may appoint three members to the board.
For as long as the City of Elk Grove is annexed into the district, the City of Elk Grove may appoint two members to the board.
A member entity that is not identified in paragraph (1), (2), or (3) may appoint one member to the board.
A city or county that is not annexed to the district may become a participating entity that may appoint at least one member to the board if the participating entity enters into an agreement with the district that provides for all of the following:
The participating entity agrees to pay its proportionate share of the district’s cost to provide rail or other districtwide transit services.
The district agrees to maintain a specified level of rail or other districtwide transit services.
The district is not obligated to provide transit services to any particular location or along any particular route.
The appointing authority of a participating entity under subdivision (b) of Section 102100.2, and the term of its appointee to the board, shall terminate upon termination or cancellation of the agreement provided for in subdivision (b) of Section 102100.2, and that agreement shall automatically terminate upon the effective date of the entity’s annexation to the district pursuant to Section 102051 or 102055.
Each voting entity shall have the right to appoint fewer members than it is entitled to appoint under Section 102100.2, except that each voting entity shall appoint at least one member. Each voting entity shall determine, effective July 1 of each year, how many members it will appoint for the upcoming fiscal year. The legislative body of each voting entity shall provide written notification to the secretary of the board not more than 60 days and not less than 15 days before July 1 of the number of appointments it will make for the upcoming fiscal year beginning July 1. Unless and until that notification is provided, the number of appointments made during the prior year shall govern.
An action by the board shall not be void or voidable if it is determined, subsequent to an action in which a member representing a participating entity casts a vote, that the agreement for that participating entity did not comply with subdivision (b) of Section 102100.2.
The appointments to the board may be changed in the following manner:
Not more often than every two years, the voting entities may, by agreement, apportion the appointments to the board among them in the approximate ratio that the district provides transit service, as determined by the gross cost of the service without regard to income or revenues of the district, within their respective boundaries.
Each voting entity appointing members to the board in accordance with Section 102100.2 may also select, in the same manner as the primary member or members, one or more alternates, as the case may be, to serve on the board when the primary member or members are not available. Each alternate shall be appointed to serve for a specific member. The alternate shall be subject to the same restrictions and shall have the same powers, when serving on the board, as the primary member. The legislative body of any voting entity appointing an alternate shall provide written notification to the secretary of the board of each appointment of an alternate in order for the appointment to be effective.
A member of a city council or board of supervisors may serve as a member of the board of directors.
The board at its first meeting, and thereafter annually at the first meeting in January, shall elect a chairman who shall preside at all meetings. In the event of his absence or inability to act, the members present, by an order entered in the minutes, shall select one of their members to act as chairman pro tem, who, while so acting, shall have all of the authority of the chairman.
The board shall establish rules for its proceedings. The acts of the board shall be expressed by motion, resolution, or ordinance. All meetings of the board shall be conducted in the manner prescribed by the Ralph M. Brown Act (Chapter 9 (commencing with Section 54950) of Part 1 of Division 2 of Title 5 of the Government Code).
Each board member shall have one vote.
A majority of the members of the board shall constitute a quorum.
All official acts of the board shall require the affirmative vote of a majority of all the members of the board, unless a higher threshold is required by law.
The board shall post the voting procedure described in this section on the district’s internet website.
Each member of the board shall receive the sum of one hundred dollars ($100) for each attendance at up to four noticed meetings of the board per month, and shall be allowed actual necessary traveling expenses incurred in the discharge of the member’s duties.
No ordinance shall be passed by the board on the day of its introduction, nor within three days thereafter, nor at any time other than at a regular or adjourned regular meeting. The enacting clause of all ordinances shall be as follows:
“The board of directors of the Sacramento Regional Transit District do ordain as follows:”
All ordinances shall be signed by the chairman of the board or the chairman pro tempore and attested by the secretary. Before the expiration of 15 days after the passage of an ordinance, it shall be published once in a newspaper of general circulation in the district or on the district’s Internet Web site. An order entered in the minutes of the board that the ordinance has been duly published is prima facie proof of such publication.
ARTICLE 2. Powers and Duties of Board of Directors [102120. - 102122.]
The board of directors is the legislative body of the district and shall determine all questions of district policy.
It shall be the duty of the board of directors and it shall have the power to:
Determine the transit facilities to be acquired and constructed by the district, the manner of operation, and the means to finance them.
Adopt an annual budget for the district and fix the compensation of its officers and employees. The board may provide in the budget for a reasonable replacement reserve.
Fix rates, rentals, charges, and classifications of transit service operated by the district.
Adopt an administrative code which shall prescribe the powers and duties of district officers, the method of appointment of district employees, and methods, procedures, and systems of operation and management of the district.
Adopt rules and regulations governing the use of transit facilities owned or operated by the district.
Cause a postaudit of the financial transactions and records of the district to be made at least annually by a certified public accountant.
Do any and all things necessary to carry out the purposes of this part.
The board of directors may adopt ordinances that do any of the following:
Prohibit persons from knowingly giving false identification to a district employee engaged in the enforcement of district ordinances or state law, or otherwise obstructing the issuance of a citation for violation of district ordinances or state law.
Prohibit unauthorized operation of, interference with, entry into, climbing upon, attaching to, or loitering on or in, transit facilities or other transit property.
Prohibit the removal, displacement, injury, destruction, or obstruction of any part of any track, switch, turnout, bridge, culvert, or any other district structure or fixture.
Specify conditions under which a passenger may board a district vehicle with a bicycle and where the bicycle may be stowed.
The board may provide that a violation of any ordinance adopted pursuant to subdivision (a) is an infraction punishable by a fine not exceeding seventy-five dollars ($75), and that a violation by a person after the second conviction is punishable by a fine not to exceed two hundred fifty dollars ($250) and by community service for a total time not to exceed 48 hours over a period not to exceed 30 days which do not conflict with the violator’s hours of school attendance or employment.
This section does not prohibit any person from engaging in activities that are protected under the laws of the United States or of California, including, but not limited to, picketing, demonstrating, or distributing handbills.
A district employee may enforce any ordinance that is adopted pursuant to this section as provided in subdivision (e) of Section 830.14 of the Penal Code.
Nothing in this section shall affect any rights or immunities conferred pursuant to Section 836.5 of the Penal Code.
ARTICLE 3. Advisory Commission [102140. - 102142.]
The board may establish an advisory commission to the board pursuant to this article.
The commission shall be composed of three persons appointed by the legislative body of each voting entity. At least one of the three persons appointed by each voting entity shall be a sitting member of the voting entity’s legislative body. Persons appointed to the commission shall serve at the pleasure of their appointing body.
The commission shall meet as often as the board deems necessary, but at least twice annually, and shall advise the board on matters of district policy, including the administrative, fiscal, and operational policies of the district and their relation to the administrative, fiscal, and operational policies of the cities and counties in which the district is operating, levels of service, and allocation of the districts financial resources. The commission shall have such other advisory duties as may be provided by the board pursuant to this part.
ARTICLE 4. Officers [102160. - 102162.]
The officers of the district shall consist of the members of the board, and the chair, chair pro tem, and secretary, who shall be selected from the members of the board, except that the secretary may alternatively be an employee of the district appointed by the board. The board may also hire and appoint a general manager, a legal counsel, a controller, a treasurer, and such other officers, assistants, and deputies as the board may deem necessary.
At any time, any city, county, or other public agency may contract with the district for the performance of services on behalf of the district by the legal counsel, controller or fiscal officer, or treasurer of the city, county, or public agency.
Article 4 (commencing with Section 1090) and Article 4.6 (commencing with Section 1120), Chapter 1, Division 4, Title 1 of the Government Code shall apply to all officers, employees, and contracts of the district.
ARTICLE 5. General Manager [102180. - 102180.]
The power and duties of the general manager are:
To head the administrative branch of the district and to be responsible to the board for the proper administration of all affairs of the district.
To appoint, supervise, suspend, or remove district employees other than members of the board and officers appointed by the board.
To supervise and direct the preparation of the annual budget for the board and be responsible for its administration after its adoption.
To formulate and present to the board plans for transit facilities within the district and the means to finance them.
To supervise the planning, acquisition, construction, maintenance, and operation of the transit facilities of the district.
To attend all meetings of the board and act as the secretary to the board.
To prepare and submit to the board, as soon as practicable after the end of each fiscal year, a complete report of the finances and administrative activities of the district for the preceding year.
To perform such other and additional duties as the board may require.
CHAPTER 5. Powers and Functions of District [102200. - 102355.]
ARTICLE 1. Corporate Power [102200. - 102205.]
The district has perpetual succession and may adopt a seal and alter it at its pleasure.
The district may sue and be sued, except as otherwise provided by law, in all actions and proceedings, in all courts and tribunals of competent jurisdiction.
All claims for money or damages against the district are governed by Division 3.6 (commencing with Section 810) of Title 1 of the Government Code except as provided therein, or by other statutes or regulations expressly applicable thereto.
Except as otherwise provided in this part, district elections shall be called, held, and conducted as provided by law for county elections. Except in cases of emergency or compelling public need, as determined by the district, district elections, including those held pursuant to Article 7 (commencing with Section 102330) or Article 8 (commencing with Section 102350), or Article 1 (commencing with Section 102500) of Chapter 7, shall be held and consolidated with city, county, or state elections, or any election held under the Uniform District Election Law (Part 4 (commencing with Section 10500) of Division 10 of the Elections Code).
The district shall annually submit its tentative or proposed budget to the legislative body of each voting entity, within the time and in the manner required in this section.
The tentative or proposed budget and the final adopted budget shall, at a minimum, include the following information for the applicable fiscal year:
The projected cost of service.
The projected revenue from fares.
The Transportation Development Act allocation for each member entity that is reserved for the district for operating purposes, as set forth in the finding of apportionment by the applicable transportation planning agency.
The projected revenue from any contract of the type described in subdivision (b) of Section 102100.2.
The projected revenue from any other local funds made available to the district by a voting entity for the operation of public transit service.
The amount of the federal formula grant funds that was available and eligible for use during the prior fiscal year for operating purposes within the Sacramento urbanized area, including funds for cities and counties that are not represented on the board.
The amount of the federal formula grant funds described in paragraph (6) that was allocated to entities other than the district.
The amount obtained by subtracting the amount described in paragraph (7) from the amount described in paragraph (6), which amount represents the federal formula grant funds that were available and eligible for use by the district for operating purposes during the prior fiscal year.
A projection of the revenue from any other source that will be available to the district for operating purposes during the fiscal year.
The population of each voting entity, as measured by the population statistics used by the applicable transportation planning agency to allocate Transportation Development Act funds for the same fiscal year for which the budget is adopted.
The tentative or proposed budget shall be submitted to the legislative body of each voting entity not less than 60 days before its adoption by the board. It shall be submitted for review and comment. The board may adopt the budget after submission to the legislative body of each voting entity, but shall consider any comments made by those legislative bodies on the budget.
Concurrent with adoption of the budget, the board shall make an affirmative finding that the proposed level of service, reflected in the statement of proposed operation and level of service, to be rendered in any voting entity, is commensurate with the level of tax or financial support to be derived from each such voting entity. In determining the level of service, the board shall consider user benefits and community benefits, in terms of one or more of the following factors:
The board shall adopt its budget at a public hearing held after the submission of the tentative or proposed budget. Notice of the time and place of the hearing shall be published pursuant to Section 6061 of the Government Code and shall be made not later than the 15th day before the date of the hearing.
ARTICLE 2. Contracts [102220. - 102225.]
The district may make contracts and enter into stipulations of any nature whatsoever, either in connection with eminent domain proceedings or otherwise, including, without limiting the generality of the foregoing, contracts and stipulations to indemnify and save harmless, to employ labor, and to do all acts necessary and convenient for the full exercise of the powers granted in this part.
The district may contract with any department or agency of the United States of America, with any public agency, or with any person upon such terms and conditions as the board finds is for the best interest of the district.
Except as provided in subdivision (b), contracts for the purchase of supplies, equipment, and materials in excess of one hundred twenty-five thousand dollars ($125,000) shall be by contract let to the lowest responsible bidder or, in the district’s discretion, to the responsible bidder that submitted a proposal that provides the best value, as defined in paragraph (1), to the district on the basis of the factors identified in the solicitation.
For purposes of this section, “best value” means the overall combination of quality, price, and other elements of a proposal that, when considered together, provide the greatest overall benefit in response to the requirements described in the solicitation documents.
To the extent practicable, when the expected procurement required exceeds three thousand dollars ($3,000) but does not exceed one hundred twenty-five thousand dollars ($125,000), a minimum of three quotations shall be obtained, either written or oral, which permit prices and other terms to be compared.
The provisions of subdivision (a) do not apply in the case of an emergency declared by a four-fifths vote of the board of directors.
This section applies solely to the procurement of supplies, equipment, and materials and shall not apply to construction contracts.
Notwithstanding Section 102222 or any other provision of law, the district may procure one or more streetcars that operated more than 50 years ago in the district’s service area without having to comply with competitive bidding procedures.
The district may insure against any accident or destruction of the system or any part thereof. The district may insure against loss of revenues from any cause whatsoever. It may provide, in the proceedings authorizing the issuance of any bonds, for the carrying of insurance in such amount and of such character as may be specified, and for the payment of the premiums thereon. The district may also provide insurance as provided in Part 6 (commencing with Section 989), Division 3.6, Title 1 of the Government Code.
The district may contract for the services of independent contractors.
ARTICLE 3. Property [102240. - 102244.]
The district may take by grant, purchase, devise, or lease, or condemn in proceedings under eminent domain, or otherwise acquire, and hold and enjoy, real and personal property of every kind within or without the district necessary to the full or convenient exercise of its powers. The board may lease, mortgage, sell, or otherwise dispose of any real or personal property within or without the district necessary to the full or convenient exercise of its powers.
As used in this section, “transit-oriented joint development project” means a development project for commercial, residential, or mixed-use purposes that is undertaken in connection with existing, planned, or proposed transit facilities and is located one-fourth mile or less from the exterior boundary of the parcel on which that facility is located.
The district may take by gift, or take or convey by grant, purchase, devise, or lease, and hold and enjoy, real and personal property of every kind within the district necessary for, incidental to, or convenient for, transit-oriented joint development projects.
Any transit-oriented joint development project undertaken pursuant to this section shall be consistent with the general plan, any applicable specific plan, any applicable transit village plan, and the land-use and development ordinances of the city or county in which the project is located.
The district may not exercise its power of eminent domain in order to make an acquisition under this section.
Prior to exercising the authority granted under this section, the district shall prepare, and shall adopt at a public hearing, written policies and procedures implementing this section.
The district shall invite public comment during the preparation and adoption of the policies and procedures required under paragraph (1), including, but not limited to, soliciting the input of community members and organizations and publishing notice of the public hearing in a newspaper of general circulation.
This section applies only to acquisitions related to transit-oriented joint development projects and does not expand the district’s existing powers.
The district may exercise the right of eminent domain to take any property necessary or convenient to the exercise of the powers granted in this part. The district, in exercising such power, shall in addition to the damages for the taking, injury, or destruction of property, also pay the cost, exclusive of betterment and with credit for salvage value, of removal, reconstruction, or relocation of any structure, railways, mains, pipes, conduits, wires, cables, or poles of any public utility which is required to be moved to a new location.
The Public Utilities Commission of the state shall have and exercise power and jurisdiction to fix just compensation to be paid for the taking of any property of a public utility in eminent domain proceedings brought by the district. No taking or acquisition by the district which would involve the abandonment, removal, relocation, or use of the property of a railroad corporation, as defined in Section 230, shall be permitted, unless the Public Utilities Commission, after a hearing, shall find and determine that the public interest and necessity require the abandonment, removal, relocation, or use of such property and that such taking or acquisition will not unreasonably impair the ability of the railroad corporation involved to provide safe, adequate, economical, and efficient service. The district may commence and maintain such eminent domain proceedings in the Public Utilities Commission or the superior court at its option.
The district is entitled to the benefit of any reservation or grant, in all cases, where any right has been reserved or granted to any public agency to construct or maintain roads, highway or other crossings over any public or private lands.
ARTICLE 4. Transit Planning [102260. - 102265.]
The district shall adopt and maintain a general transit plan for the district. The district may designate one of the transit plans it is otherwise required to prepare as the general transit plan.
The general transit plan, or any element or amendment thereof, shall be adopted in the manner provided in this article.
Before adopting the plan, or an element or amendment thereof, the board shall refer the plan or element or amendment thereof to the advisory commission, if the commission has been established under Article 3 (commencing with Section 102140) of Chapter 4 of this part. Failure of the advisory commission to consider such matters within a reasonable time as established by the board shall not prevent the board from acting under this article.
Before adopting the plan, or an element or amendment thereof, the board shall hold a public hearing. Notice of the time and place of the hearing shall be given at least 30 days before the hearing. The notice shall be published pursuant to Section 6061 of the Government Code and written notice shall also be mailed to each city council and board of supervisors in the district. The hearing may be continued from time to time.
The adoption of the general plan, or an element or amendment thereof, shall be by resolution of the board.
The Sacramento Area Council of Governments shall be the long-range planning agency advising the district.
ARTICLE 5. Transit Facilities and Service [102280. - 102289.]
The district may provide transit service for the transportation of passengers and their incidental baggage by any means, both within and outside the district.
The district may provide charter bus service, special school service, and other service to the extent permitted under federal law.
The board may contract with a public agency or person to provide transit facilities and services for the district. A public agency may contract with the district to provide transit facilities and services for the public agency.
The district may construct and operate or acquire and operate transit works and facilities in, under, upon, over, across, or along any state or public highway or any stream, bay or water course, or over any of the lands which are the property of the state, to the same extent that such rights and privileges appertaining thereto are granted to municipalities within the state.
The district may enter into agreements for the joint use of any property and rights by the district and any public agency or public utility operating transit facilities; may enter into agreements with any public agency or public utility operating any transit facilities, and wholly or partially within or without the district, for the joint use of any property of the district or of the public agency or public utility, or the establishment of through routes, joint fares, transfer of passengers or pooling arrangements.
In addition to any power described in subdivision (a), the district may enter into agreements for the joint use or joint development of any property or rights by the district and any public agency, or public utility operating transit facilities or nontransit facilities, or both, or any other person, firm, corporation, association, organization, or other entity, public or private, either, in whole or in part, within or outside the district, for the joint use or development of any nontransit facilities of the district or of the public agency, public utility, person, firm, corporation, association, organization, or other entity, public or private, for the establishment of through routes, joint fares, transfer of passengers, pooling arrangements, station cost-sharing, connector fees, or land, air, or development rights, sales or leasing, necessary for, incidental to, or convenient for, the full exercise of the powers granted in this chapter. For the purpose of this section, the following terms have the following meanings:
“Joint development” includes, but is not limited to, agreements with any person, firm, corporation, association, organization, or other entity, public or private, to develop or to engage in the planning, financing, construction, or operation of nontransit district facilities or development projects adjacent, or physically or functionally related, to district transit facilities.
“Development project” includes, but is not limited to, projects for any use or mixed use including public, commercial, or residential uses.
“Nontransit facilities,” includes, but is not limited to, any land, buildings, or equipment, or interest therein, that is used for the production of transit revenue not arising from the operation of a transit system.
Construction projects or works of improvement for facilities authorized by the district under the terms of a joint development agreement that is approved under the authority conferred by this section shall be considered a public works project subject to Chapter 1 (commencing with Section 1720) of Part 7 of Division 2 of the Labor Code and shall be enforced by the Department of Industrial Relations in the same manner in which it carries out this responsibility under the Labor Code.
The rates and charges, if any, for transit service furnished pursuant to this part shall be fixed by the board and shall be reasonable.
The district shall be subject to the provisions of Division 14.8 (commencing with Section 34500) of the Vehicle Code with respect to operation of buses and to the rules and regulations enforceable by the Department of the California Highway Patrol pursuant to that chapter regulating the safe operation of buses.
The district and any one or more school districts may enter into agreements pursuant to which school transportation equipment may be used by the district.
The district may acquire, construct, own, operate, control, or use rights-of-way, rail lines, buslines, stations, platforms, switches, yards, terminals, parking lots, and any and all facilities necessary or convenient for transit service, within or partly outside the district, underground, upon, or above the ground and under, upon or over public streets or other public ways or waterways, together with all physical structures necessary or convenient for the access of persons or vehicles thereto, and may acquire any interest in or rights to use or joint use of any or all of the foregoing; however, installations in state freeways are subject to the approval of the Department of Transportation, and installations in other state highways are subject to Article 2 (commencing with Section 670) of Chapter 3 of Division 1 of the Streets and Highways Code. Installations in county highways and city streets are subject to similar encroachment permits.
In addition to any power described in subdivision (a), the district may, to the extent that it is not expressly provided for in subdivision (a), develop, lease, jointly develop, or jointly use air rights, land rights, development rights, rights-of-way, rail trackage, entrances and exits, and any and all fixed facilities and structures physically or functionally related to transit service.
Construction projects or works of improvement for facilities authorized by the district under the terms of a joint development agreement that is approved under the authority conferred by this section shall be considered a public works project subject to Chapter 1 (commencing with Section 1720) of Part 7 of Division 2 of the Labor Code and shall be enforced by the Department of Industrial Relations in the same manner in which it carries out this responsibility under the Labor Code.
The district may lease or contract for the use of its transit facilities, or any portion thereof, to any operator, and may provide for subleases by such operator upon such terms and conditions as it deems in the public interest. The word “operator” as used in this section means any public agency or any person.
ARTICLE 6. Public Grants, Loans and Contributions [102310. - 102311.]
The district may accept, without limitation by any other provisions of this part requiring approval of indebtedness, contributions, grants, or loans from any public agency or the United States or any department, instrumentality, or agency thereof, for the purpose of financing the acquisition, construction, maintenance, or operation of transit facilities, and may enter into contracts and cooperate with, and accept cooperation from, any public agency or the United States, or agency thereof, in the acquisition, construction, maintenance, or operation, and in financing the acquisition, construction, maintenance, or operation of any such transit facilities in accordance with any legislation which Congress or the Legislature of the State of California may have heretofore adopted or may hereafter adopt, under which aid, assistance, and cooperation may be furnished by the United States or any public agency in the acquisition, construction, maintenance, and operation of any such transit facilities. The district may do any and all things necessary in order to avail itself of such aid, assistance, and cooperation under any federal or state legislation now or hereafter enacted. Any evidence of indebtedness issued under this section shall constitute a negotiable instrument. Laws, or rules or regulations, of this state inconsistent with the laws, or rules and regulations, of the United States, shall not apply to the acquisition, construction, maintenance, or operation of transit facilities funded by the United States, to the extent of the inconsistency, if that inconsistency may result in a loss of federal funding.
The district shall have the power to obtain temporary transfers of funds in accordance with the last paragraph of Section 6 of Article XVI of the California Constitution.
ARTICLE 7. Property Taxation [102330. - 102345.]
The district may levy and collect, or cause to be collected, property taxes for any lawful purpose.
In addition to revenues and receipts from other sources, the board may levy and collect a property tax in the entirety of, or a portion of, the incorporated and unincorporated territory. The board may impose different rates of taxation in areas within the district. Authority exercised pursuant to this subdivision shall be subject to any applicable constitutional requirements.
If the tax only applies to a portion of an area of the district, both of the following shall apply to the imposition of the tax:
The incorporated area of each city and of contiguous cities within the district shall be either wholly included within that portion or wholly excluded from that portion. For purposes of this paragraph, “contiguous cities” means two or more cities with shared borders.
The entire unincorporated area of the district shall either be wholly included within that portion or wholly excluded from that portion.
The proceeds of the property tax shall be used to provide, within the areas taxed, for the improvement or acquisition of any real property needed for transportation purposes.
An election to impose a property tax as described in this section shall only include the voters of those portions of the area of the district in which the property tax will be imposed.
The district shall not levy or collect a property tax within any city or within the unincorporated area of the district until:
The legislative body of the city or county adopts a resolution declaring there is need for the district to operate and levy a tax within the city or the unincorporated area of the district.
Two-thirds of the voters of the city or the unincorporated area, following the adoption of the resolution under subdivision (a), voting on the question at an election called for that purpose, approve the operation of the district, and the levy of a property tax by the district, within the city or within the unincorporated area of the district.
The district may conduct a single election in an area comprising the area of a city and the unincorporated area of the district, or any combination of those areas, with the approval of the cities and the unincorporated area of the district concerned, in which event two-thirds of the voters voting at the election shall be sufficient to approve the proposition submitted for the entire area included in the election. Where more than one election will be held, the approval of the voters in one election pertaining to an area may be conditioned upon the approval of voters in one or more other elections pertaining to other areas.
Each election shall be called and conducted by the district in the same manner as provided by law for the conduct of special elections by a county. The board may contract with a county, or delegate to the appropriate county officials the authority, to conduct the election within the county on behalf of the district. The costs of any such election may be advanced to the district by any city or county prior to the time that the district has revenues of its own, to be repaid from subsequent district revenues.
The ballot for the election shall contain such instructions as are required by law to be printed thereon and in addition thereto, the following:
The district board may impose a special tax pursuant to Article 3.5 (commencing with Section 50075) of Chapter 1 of Part 1 of Division 1 of Title 5 of the Government Code, subject to any applicable constitutional requirements. The special taxes shall be applied uniformly to all taxpayers or all real property within the district, or any portion of the district, except that unimproved property may be taxed at a lower rate than improved property.
If the tax only applies to a portion of an area of the district, both of the following shall apply to the imposition of the tax:
The incorporated area of each city and of contiguous cities within the district shall be either wholly included within that portion or wholly excluded from that portion. For purposes of this paragraph, “contiguous cities” means two or more cities with shared borders.
The entire unincorporated area of the district shall either be wholly included within that portion or wholly excluded from that portion.
The proceeds of the special tax shall be used to provide, within the area taxed, for the operation, maintenance, or acquisition of any public improvement or utility for transportation purposes.
An election to impose a special tax as described in this section shall only include the voters of those portions of the area of the district in which the special tax will be imposed.
The board shall avail itself of the assessments made by the assessor of any county in which it operates and of the assessments made by the State Board of Equalization for the county and shall take such assessments as the basis for district property taxation and have its property taxes collected by the tax collector of the county.
The county auditor shall, on or before the third Monday in August of each year, transmit to the board a statement in writing showing the total value of all property within the county lying within an authorized taxing area of the district, ascertained from the assessments referred to in Section 102337.
The board shall, on or before the first day of September, fix the rate or rates of taxes, designating the number of cents upon each one hundred dollars ($100), and use as a basis the value of property transmitted to the board by the county auditor, which rate of taxation shall be sufficient to raise the amount previously fixed by the board.
The board shall, immediately after fixing the rate or rates of taxes, transmit to the county auditor of each county in which the board has levied a tax, a statement of the rate of taxes fixed by the board.
The district’s taxes so levied shall be collected at the same time and in the same manner as county taxes. When collected, the net amount, ascertained as provided in this article, shall be paid to the treasurer of the district under the general requirements and penalties provided by law for the settlement of other taxes.
Whenever any real property has been sold for taxes and has been redeemed, the money paid for redemption shall be apportioned and paid to the district by the county treasurer in the proportion which the tax due to the district bears to the total tax for which the property was sold.
All taxes levied under this part are a lien on the property on which they are levied. The enforcement of the collection of such taxes shall be in the same manner and by the same means provided by law for the enforcement of liens for county taxes, all the provisions of law relating to the enforcement of the latter being made a part of this part so far as applicable.
The county shall be compensated for services under this article at the rate of 1 percent for collecting the first twenty-five thousand dollars ($25,000), and one-fourth of 1 percent for all sums over that amount.
In lieu of, or in addition to, any taxes which may be levied by the district pursuant to this article, the legislative body of any city or county may enter into agreement with the district to make annual contributions to the district from its general funds or from any other source of funds legally available to it for such purpose.
ARTICLE 8. Retail Transactions and Use Tax [102350. - 102355.]
A retail transactions and use tax ordinance may be adopted by the board in accordance with the provisions of Part 1.6 (commencing with Section 7251) of Division 2 of the Revenue and Taxation Code, provided two-thirds of the electors voting on the measure vote to authorize its enactment at a special election called for that purpose by the board, subject to any applicable constitutional requirements.
The board, in the ordinance, shall state the nature of the tax to be imposed, the tax rate or the maximum tax rate, the purposes for which the revenue derived from the tax will be used, and the portion of the area of the board to which the tax would apply, and may set a term during which the tax will be imposed. The purposes for which the tax revenues may be used shall be limited to public transit purposes serving the area of jurisdiction of the district, as determined by the board, including the administration of this part and legal actions related thereto. These purposes include expenditures for planning, environmental reviews, engineering and design costs, and related right-of-way acquisition.
As used in this section, “public transit purposes” includes the public transit responsibilities under the jurisdiction of the district as well as any repair, redesign, or ongoing maintenance of a right-of-way upon which transit is intended to travel, or any bikeway, bicycle path, sidewalk, trail, pedestrian access, or pedestrian accessway.
The retail transactions and use tax ordinance shall provide for a rate of one-eighth of 1 percent or a multiple thereof. The ordinance shall provide for the tax to be imposed on the entirety of, or a portion of, the incorporated and unincorporated territory within the boundaries of the district, as defined in Section 102052.5. The ordinance shall be subject to voter approval by the electors in those portions of the district to which the tax applies and shall be consistent with Section 102350.
The portion of the area of the board to which the tax would apply shall be determined by the board before the electors vote on the measure.
If the tax only applies to a portion of an area of the district, all of the following shall apply to the imposition of the tax:
The incorporated area of each city and of contiguous cities within the district shall be either wholly included within that portion or wholly excluded from that portion. For purposes of this paragraph, “contiguous cities” means two or more cities with shared borders.
The entire unincorporated area of the district shall either be wholly included within that portion or wholly excluded from that portion.
The revenues derived from the tax shall be spent within, or for the benefit of, the portion of the area of the district to which the tax applies, and shall be spent only on allowable transportation and transit infrastructure and services.
Any revenues derived from the tax shall supplement, and not supplant, other transportation revenues available to the portion of the area of the board to which the tax applies.
Any transactions and use tax ordinance adopted pursuant to this article shall be operative on the first day of the first calendar quarter commencing more than 150 days after adoption of the ordinance.
Prior to the operative date of the ordinance, the district shall contract with the California Department of Tax and Fee Administration to perform all functions incident to the administration and operation of the ordinance. The costs to be covered by the contract may also include services of the types described in Section 7272 of the Revenue and Taxation Code for preparatory work up to the operative date of the ordinance. Any disputes as to the amount of the costs shall be resolved in the same manner as provided in that section.
Notwithstanding Section 7272 of the Revenue and Taxation Code, the maximum amount of preparatory costs incurred may exceed those costs as described in paragraph (1) if the increased amount reflects necessary preparatory costs.
Within 45 days from the date the ordinance is approved by the voters, the district shall provide the California Department of Tax and Fee Administration with a complete alphabetical list of all streets within the affected unincorporated area under the jurisdiction of the district pursuant to Section 102052.5, which shall include beginning and ending street numbers, and shall maintain that list on its internet website. The district shall also provide a legal description and a map or plat, that both describe the boundaries of the applicable unincorporated territory within the district pursuant to Section 102052.5.
Repeal of the transactions and use tax ordinance shall not be operative earlier than the first day of the first calendar quarter following the adoption of the ordinance of repeal.
CHAPTER 6. Personnel [102398. - 102432.]
ARTICLE 1. Employee Relations [102398. - 102418.]
As used in this chapter, the following definitions apply:
“District” means the Sacramento Regional Transit District, including all operations and extensions of its transportation system, regardless of modality or vehicle type, and excluding all temporary bus lines.
“Employee organization” means an organization that includes employees of the district that has as one of its primary purposes representing those employees in their relations with the district. “Employee organization” shall also include any person of the organization authorized to act on its behalf.
“Exclusive representative” means an accredited employee organization recognized or certified as the exclusive negotiating representative of employees in an appropriate unit within the district.
It is a primary purpose of this chapter to promote the improvement of personnel management and employer-employee relations within the district by providing a uniform basis for recognizing the right of employees to join employee organizations of their own choice, to be represented, to select one employee organization as the exclusive representative of the employees in an appropriate unit, and to afford employees a voice at work.
The Public Employment Relations Board established pursuant to Section 3541 of the Government Code, and the powers and duties of that board, as described in Section 3541.3 of the Government Code, shall have jurisdiction, as appropriate, to enforce this chapter and its existing regulations, shall apply, as appropriate, to this chapter. The board shall perform its duties under this section consistent with its regulations and shall have the authority to make additional regulations. The board may also adopt, amend, or repeal all rules and regulations necessary to carry out this article as emergency regulations in accordance with the rulemaking provisions of the Administrative Procedure Act (Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code). The adoption, amendment, or repeal of regulations pursuant to this subdivision is conclusively presumed to be necessary for the immediate preservation of the public peace, health, safety, or general welfare within the meaning of Section 11346.1 of the Government Code.
Employees shall have the right to self-organization, to form, join, or assist employee organizations, to bargain collectively through representatives of their own choosing, and to engage in other concerted activities for the purpose of collective bargaining or other mutual aid or protection.
Notwithstanding any other provision of this part, whenever a majority of the employees employed by the district in a unit appropriate for collective bargaining indicate a desire to be represented by an employee organization, the district, upon determining, as provided in Section 102403, that the employee organization represents the employees in the appropriate unit, shall enter into a written contract with the exclusive representative of the employees governing wages, salaries, hours, pensions, and working conditions. If, after a reasonable period of time, representatives of the district and the exclusive representatives of the employees fail to reach agreement either on the terms of a written contract governing wages, hours, pensions, and working conditions or the interpretation or application of the terms of an existing contract, upon the agreement of both the district and the representatives of the employees, the dispute may be submitted to an arbitration board and the decision of the majority of the arbitration board shall be final and binding.
The arbitration board shall be composed of two representatives of the district, and two representatives of the employee organization, and they shall endeavor to agree upon the selection of the fifth member. If they are unable to agree, the names of five persons experienced in labor arbitration shall be obtained from the California State Mediation and Conciliation Service. The employee organization and the district shall, alternately, strike a name from the list so supplied, and the name remaining after the employee organization and the district have stricken four names, shall be designated as the arbitrator. The employee organization and the district shall determine by lot who shall first strike from the list. The decision of a majority of the arbitration board shall be final and binding upon the parties. The expenses of arbitration shall be borne equally by the parties. Each party shall bear their own costs.
A contract or agreement shall not be made, or assumed under this article, with any employee organization, association, or group that denies membership to, or in any manner discriminates against, any employee on any basis listed in subdivision (a) of Section 12940 of the Government Code, as those bases are defined in Sections 12926 and 12926.1 of the Government Code. However, the organization may preclude from membership any individual who advocates the overthrow of the government by force or violence.
The district shall not discriminate with regard to employment against any person on any basis listed in subdivision (a) of Section 12940 of the Government Code, as those bases are defined in Sections 12926 and 12926.1 of the Government Code, except as otherwise provided in Section 12940 of the Government Code.
If there is a question whether an employee organization represents a majority of employees or whether the proposed unit is or is not appropriate, such matters shall be submitted to the California State Mediation and Conciliation Service for disposition. The California State Mediation and Conciliation Service shall promptly hold a public hearing after due notice to all interested parties and shall thereupon determine the unit appropriate for the purposes of collective bargaining. In making such determination and in establishing rules and regulations governing petitions and the conduct of hearings and elections, the California State Mediation and Conciliation Service shall be guided by relevant federal law and administrative practice, developed under the Labor-Management Relations Act, 1947, as presently amended. It is declared to be in the public interest that the district shall not express any preference for one union over another.
The California State Mediation and Conciliation Service shall provide for an election to determine the question of representation and shall certify the results to the parties. Any certification of an employee organization to represent or act for the employees in any collective bargaining unit shall not be subject to challenge on the grounds that a new substantial question of representation within such collective bargaining unit exists until the lapse of one year from the date of certification or the expiration of any collective bargaining agreement, whichever is later; provided, that no collective bargaining agreement shall be construed to be a bar to representation proceedings for a period of more than two years.
Exclusive representatives shall have the right to represent their bargaining unit members in employer-employee relations with the district, and employees shall have the right to be represented by their exclusive representative.
This chapter is not intended to adversely affect any rights afforded to exclusive representatives or district employees under existing law, as it may be amended from time to time.
The district shall give reasonable written notice to an exclusive representative of its intent to make any change to matters within the scope of representation of the employees represented by the exclusive representative for purposes of providing the exclusive representative a reasonable amount of time to negotiate with the district regarding the proposed changes.
It is unlawful for the district to do any of the following:
Impose or threaten to impose reprisals on employees, to discriminate or threaten to discriminate against employees, or otherwise to interfere with, restrain, or coerce employees because of their exercise of rights guaranteed to them by this chapter. As used in this subdivision, “employee” includes an applicant for employment or reemployment with the district.
Deny employee organizations rights guaranteed to them by this chapter.
Refuse or fail to meet and negotiate in good faith with an exclusive representative. Knowingly providing an exclusive representative with inaccurate information, whether or not it is in response to a request for information, constitutes a refusal or failure of the district to meet and negotiate in good faith with the exclusive representative.
Dominate or interfere with the formation or administration of any employee organization, or contribute financial or other support to it, or in any way encourage employees to join any employee organization in preference to another.
Refuse to participate in good faith in mutually agreed upon impasse procedures.
It is unlawful for an employee organization to do any of the following:
Impose or threaten to impose reprisals on employees, discriminate or threaten to discriminate against employees, or otherwise interfere with, restrain, or coerce employees because of their exercise of rights guaranteed to them by this chapter.
Refuse or fail to meet and negotiate in good faith with the district concerning any of the employees of which it is the exclusive representative.
Refuse to participate in good faith in mutually agreed upon impasse procedures.
This chapter shall not displace, or supplant, the requirements of Chapter 3 (commencing with Section 3610) of Division 4.5 of Title 1 of the Government Code, and the impasse resolution and injunctive relief procedures provided for pursuant to Sections 3612 to 3614, inclusive, of the Government Code shall remain exclusive.
An exclusive representative may elect to move one or more of its bargaining units to the jurisdiction of the Public Employment Relations Board for unfair practice charges. Notification by the exclusive representative of such election shall be filed with the General Counsel of the Public Employment Relations Board or their designee and served on the district pursuant to applicable regulations. An election by an exclusive representative for one or more of its bargaining units to be subject to the jurisdiction of the Public Employment Relations Board shall be irrevocable for that unit.
The initial determination as to whether the charge of unfair practice is justified and, if so, the appropriate remedy necessary to effectuate the purposes of this chapter, is a matter within the exclusive jurisdiction of the Public Employment Relations Board, except that in an action to recover damages due to an unlawful strike, the Public Employment Relations Board shall have no authority to award strike-preparation expenses as damages, and shall have no authority to award damages for costs, expenses, or revenue losses incurred during, or as a consequence of, an unlawful strike.
Any charging party, respondent, or intervenor aggrieved by a final decision or order of the Public Employment Relations Board in an unfair practice case, except a decision of that board not to issue a complaint in such a case, may petition for a writ of extraordinary relief from that decision or order.
A petition for a writ of extraordinary relief shall be filed in the district court of appeal having jurisdiction over any county in which the district operates. The petition shall be filed within 30 days from the date of the issuance of the Public Employment Relations Board’s final decision or order, or order denying reconsideration, as applicable. Upon the filing of the petition, the court shall cause notice to be served upon the Public Employment Relations Board and thereafter shall have jurisdiction of the proceeding. The Public Employment Relations Board shall file in the court the record of the proceeding, certified by that board, within 10 days after the clerk’s notice unless that time is extended by the court for good cause shown. The court shall have jurisdiction to grant any temporary relief or restraining order it deems just and proper, and in like manner to make and enter a decree enforcing, modifying, and enforcing as modified, or setting aside in whole or in part the decision or order of the Public Employment Relations Board. The findings of the Public Employment Relations Board with respect to questions of fact, including ultimate facts, if supported by substantial evidence on the record considered as a whole, shall be conclusive. Title 1 (commencing with Section 1067) of Part 3 of the Code of Civil Procedure relating to writs shall, except where specifically superseded by this section, apply to proceedings pursuant to this section.
If the time to petition for extraordinary relief from a Public Employment Relations Board decision or order has expired, the Public Employment Relations Board may seek enforcement of any final decision or order in a district court of appeal or superior court having jurisdiction over the county where the events giving rise to the decision or order occurred. The Public Employment Relations Board shall respond within 10 days to any inquiry from a party to the action as to why the Public Employment Relations Board has not sought court enforcement of the final decision or order. If the response does not indicate that there has been compliance with the Public Employment Relations Board’s final decision or order, the Public Employment Relations Board shall seek enforcement of the final decision or order upon the request of the party. The Public Employment Relations Board shall file in the court the record of the proceeding, certified by that board, and appropriate evidence disclosing the failure to comply with the decision or order. If, after hearing, the court determines that the order was issued pursuant to the procedures established by the Public Employment Relations Board and that the person or entity refuses to comply with the order, the court shall enforce the order by writ of mandamus or other proper process. The court may not review the merits of the order.
This chapter, as amended by the act adding this section, shall not be interpreted as if it were in conflict with any collective bargaining agreement and shall not be implemented to abrogate an agreement entered into before January 1, 2022, between the district and an employee organization. Sections 102405 to 102408, inclusive, shall be interpreted in a manner consistent with the Public Employment Relations Board’s interpretation of parallel provisions in other statutes it enforces.
Whenever the district acquires existing facilities from a publicly or privately owned public utility, either in proceedings by eminent domain or otherwise, the district shall assume and observe all existing pension and labor contracts. To the extent necessary for operation of facilities, all of the employees of the acquired public utility whose duties pertain to the facilities acquired shall be appointed to comparable positions in the district without examination, subject to all the rights and benefits of this part, and these employees shall be given sick leave, seniority, vacation, and pension credits in accordance with the records and labor agreements of the acquired public utility. Members and beneficiaries of any pension or retirement system or other benefits established by that public utility shall continue to have the rights, privileges, benefits, obligations, and status with respect to that established system. No employee of any acquired public utility shall suffer any worsening of their wages, seniority, pension, vacation, or other benefits by reason of the acquisition.
The district may extend the benefits of this section to officers or supervisory employees of the acquired public utility.
The district shall not contract with any company, person, or public agency for that company, person, or public agency to provide transit facilities or services or acquire any existing system, or part thereof, whether by purchase, lease, condemnation, or otherwise, nor shall the district dispose of or lease any transit system, or of its system, or part thereof, nor merge, consolidate, or coordinate any transit system or part thereof, unless it shall first have made adequate provision for any employees who are, or may be, displaced. The terms and conditions of the provision shall be a proper subject of collective bargaining.
Notwithstanding the provisions of the Government Code, employees of this district may authorize and, upon authorization, the district shall make deductions from wages and salaries of employees pursuant to a collective bargaining agreement with a duly designated or certified labor organization:
For the payment of union dues, fees, or assessments.
For the payment of contributions pursuant to any health and welfare plan or pension or retirement plan.
For any purpose for which deductions may be authorized by employees of any private employer.
The obligation of the district to bargain in good faith with a duly designated or certified employee organization and to execute a written collective bargaining agreement with that employee organization covering the wages, hours, and working conditions of the employees represented by that employee organization in an appropriate unit, and to comply with the terms thereof, shall not be limited or restricted by any provision of law. The obligation of the district to bargain collectively shall extend to all subjects of collective bargaining that are or may be proper subjects of collective bargaining with a private employer, including retroactive provisions. The duly designated or certified employee organization shall also have the obligation to bargain in good faith.
The district shall take steps as may be necessary to obtain coverage for the district and its employees under Subchapter II of the Federal Social Security Act, as amended, and the related provisions of the Federal Insurance Contributions Act, as amended.
The district shall take steps as may be necessary to obtain coverage for the district and its employees under the workers’ compensation, unemployment compensation disability, and unemployment insurance laws of the State of California.
In the event an exclusive collective bargaining representative is selected pursuant to Section 102403, the provisions of Chapter 10 (commencing with Section 3500) of Division 4 of Title 1 of the Government Code are not applicable to the district.
Chapter 11.5 (commencing with Section 3555) of Division 4 of Title 1 of the Government Code applies to the district and its employees. Notwithstanding subparagraph (B) of paragraph (1) of subdivision (i) of Section 3558.8 of the Government Code, the district is a public employer for purposes of Chapter 11.5 (commencing with Section 3555) of Division 4 of Title 1 of the Government Code.
ARTICLE 2. Retirement System [102430. - 102432.]
The district may provide for a retirement system; provided, that the adoption, terms, and conditions of any retirement system covering employees of the district represented by a labor organization in accordance with this section shall be pursuant to a collective bargaining agreement between such labor organization and the district.
If the district establishes a retirement board for the retirement system, board members and employees of the district may serve on the retirement board.
The district may establish trust accounts for the purposes of this section.
The board may contract with the board of administration of the Public Employees’ Retirement System and enter all or any portion of its employees under such system, provided, that no employees of the district in a bargaining unit which is represented by a labor organization shall be included in such contract except as authorized by a collective bargaining agreement.
Whenever the district acquires existing facilities from a publicly or privately owned public utility, either in proceedings in eminent domain or otherwise, that has a pension plan in operation, members and beneficiaries of such pension plan shall continue to have the rights, privileges, benefits, obligations, and status with respect to such established system.
Whenever any such facilities are acquired by the district, the board shall consider and take into account the outstanding obligations and liabilities of the publicly or privately owned public utility by reason of such pension plan, and shall negotiate an allowance in the purchase price of such utility for the assumption of such obligations and liabilities when acquiring the facilities.
CHAPTER 7. Bonds and Other Evidences of Indebtedness [102500. - 102603.]
ARTICLE 1. Authorization and Issuance of General Obligation Bonds [102500. - 102513.]
The district may exercise its powers under this article only with respect to territory in cities and counties in which the voters have authorized the district to operate and levy a tax; the term “district” as used in this article, shall be limited to such territory for purposes of the election and the incurring of indebtedness, and for purposes of Section 102336.
Whenever the board deems it necessary for the district to incur a bonded indebtedness for the acquisition, construction, or repair of any or all improvements, works, property or facilities, authorized by this part or necessary or convenient for the carrying out of the powers of the district, or for any other purpose authorized by this part, it shall, by ordinance, adopted by a two-thirds vote of the board, so declare and call an election to be held in the district for the purpose of submitting to the qualified voters thereof the proposition of incurring indebtedness by the issuance of bonds of the district; provided the total amount of bonds issued and outstanding pursuant to this article shall not exceed 15 percent of the assessed value of the taxable property of the district as shown by the last equalized assessment rolls of the counties of Sacramento, Placer, and Yolo. The ordinance shall state:
The purposes for which the proposed debt is to be incurred, which may include all costs and estimated costs incidental to or connected with the accomplishment of those purposes, including, without limitation, engineering, inspection, legal, fiscal agents, financial consultant and other fees, bond and other reserve funds, working capital, bond interest estimated to accrue during the construction period and for a period not to exceed three years thereafter, and expenses of all proceedings for the authorization, issuance, and sale of the bonds.
The estimated cost of accomplishing those purposes.
The amount of the principal of the indebtedness.
The maximum term the bonds proposed to be issued shall run before maturity, which shall not exceed 50 years from the date thereof or the date of each series thereof.
The maximum rate of interest to be paid, which shall not exceed 7 percent per annum.
The proposition to be submitted to the voters, which may include one or more purposes.
The date of the election.
The manner of holding the election and the procedure for voting for or against the measure.
The ordinance may also contain any other matters authorized by this part or any other law.
Notice of the holding of such election shall be given by publishing, pursuant to Section 6066 of the Government Code, the ordinance calling the election in at least one newspaper published in such district. No other notice of such election need be given. Except as otherwise provided in the ordinance, the election shall be conducted as other district elections.
If any proposition is defeated by the electors, the board shall not call another election on a substantially similar proposition to be held within six months after the prior election. If a petition requesting submission of such a proposition, signed by 15 percent of the district electors, as shown by the votes cast for all candidates for governor within the district at the last gubernatorial election, is filed with the board, it may call an election before the expiration of six months.
If a majority of the electors voting on the proposition vote for it, then the board may, by resolution, at such time or times as it deems proper, issue bonds of the district for the whole or any part of the amount of the indebtedness so authorized and may from time to time, by resolution, provide for the issuance of such amounts as the necessity thereof may appear, until the full amount of such bonds authorized shall have been issued. The full amount of bonds may be divided into two or more series and different dates and different dates of payment fixed for the bonds of each series. A bond need not mature on an anniversary of its date. The maximum term the bonds of any series shall run before maturity shall not exceed 50 years from the date of each series respectively. In such resolution or resolutions, the board shall prescribe the form of the bonds (including, without limitation, registered bonds and coupon bonds) and the form of any coupons to be attached thereto, the registration, conversion and exchange privileges, if any, pertaining thereto, and fix the time when the whole or any part of the principal shall become due and payable.
The bonds shall bear interest at a rate or rates not exceeding 8 percent per annum, payable semiannually, except that the first interest payable on the bonds or any series thereof may be for any period not exceeding one year as determined by the board. In the resolution or resolutions providing for the issuance of such bonds, the board may also provide for call and redemption of such bonds prior to maturity at such times and prices and upon such other terms as it may specify, provided that no bond shall be subject to call or redemption prior to maturity unless it contains a recital to that effect or unless a statement to that effect is printed thereon. The denomination or denominations of the bonds shall be stated in the resolution providing for their issuance, but shall not be less than one thousand dollars ($1,000). The principal of and interest on such bonds shall be payable in lawful money of the United States at the office of the treasurer of the district or at such other place or places as may be designated, or at either place or places at the option of the holders of the bonds. The bonds, or such series thereof, shall be dated and numbered consecutively and shall be signed by the chairman of the board and the treasurer, countersigned by the secretary and the official seal of the district attached. The interest coupons of such bonds shall be signed by the treasurer. All such signatures, countersignatures and seal may be printed, lithographed or mechanically reproduced, except that one of such signatures or countersignatures on the bonds shall be manually affixed. If any officer whose signature or countersignature appears on bonds or coupons ceases to be such officer before the delivery of the bonds, his signature is as effective as if he had remained in office.
The bonds may be sold as the board determines by resolution, but for not less than par. Before selling the bonds, or any part thereof, the board shall give notice inviting sealed bids in such manner as it may prescribe. If satisfactory bids are received, the bonds offered for sale shall be awarded to the highest responsible bidder. If no bids are received, or if the board determines that the bids received are not satisfactory as to price or responsibility of the bidders, the board may reject all bids received, if any, and either readvertise or sell the bonds at private sale.
Delivery of any bonds may be made at any place either inside or outside the state, and the purchase price may be received in cash or bank credits.
All accrued interest and premiums received on the sale of bonds shall be placed in the fund to be used for the payment of principal of and interest on the bonds and the remainder of the proceeds of the bonds shall be placed in the treasury to the credit of the proper improvement fund and applied exclusively to the purposes for which the debt was incurred (which purposes shall be in conformity with an approved general transit plan or element thereof then in effect); provided, however, that when such purposes have been accomplished, any moneys remaining in such improvement fund (a) shall be transferred to the fund to be used for the payment of principal of and interest on the bonds, or (b) shall be placed in a fund to be used for the purchase of outstanding bonds of the district from time to time in the open market at such prices and in such manner, either at public or private sale or otherwise, as the board may determine. Bonds so purchased shall be canceled immediately.
After the expiration of three years after a bond election, the board may determine, by ordinance adopted by a two-thirds vote of the board, that any or all of the bonds authorized at the election remaining unsold shall not be issued or sold. When the ordinance takes effect, the authorization to issue those bonds shall become void.
Whenever the board deems that the expenditure of money for the purposes for which the bonds were authorized by the voters is impractical or unwise, it may, by ordinance adopted by a two-thirds vote of the board, so declare and call an election to be held in the district for the purpose of submitting to the qualified voters thereof the proposition of incurring indebtedness by the issuance of those bonds for some other purposes or, in the case where bonds have been sold, the proposition to use the proceeds for some other purposes. The procedure, so far as applicable, shall be the same as when a bond proposition is originally submitted.
The board may provide for the issuance, sale, or exchange of refunding bonds to redeem or retire any bonds issued by the district upon the terms, at the times and in the manner which it determines. Refunding bonds may be issued in a principal amount sufficient to pay all, or any part, of the principal of such outstanding bonds, the interest thereon and the premiums, if any, due upon call and redemption thereof prior to maturity, and all expenses of such refunding. The provisions of this article for issuance and sale of bonds apply to the issuance and sale of such refunding bonds; except that (a) no election need be called or held for the purpose of authorizing the issuance of refunding bonds, and (b) when refunding bonds are to be exchanged for outstanding bonds the method of exchange shall be as determined by the board.
The provisions of Article 4 (commencing with Section 53500), Chapter 3, Part 1, Division 2, Title 5 of the Government Code are applicable to the district.
Any bonds which shall be issued under the provisions of this article shall be legal investment for all trust funds; for the funds of insurance companies, banks—both commercial and savings—and trust companies; and for state school funds; and whenever any money or funds may, by any law now or hereafter enacted, be invested in bonds of cities, cities and counties, counties, school districts, or other districts within the State of California, such money or funds may be invested in the bonds issued under this part, and whenever bonds of cities, cities and counties, counties, school districts, or other districts within this state may, by any law now or hereafter enacted, be used as security for the performance of any act or the deposit of any public moneys, the said bonds issued under this part may be so used. The provisions of this article shall be in addition to all other laws relating to legal investments and shall be controlling as the latest expression of the Legislature with respect thereto.
ARTICLE 2. Revenue Bonds [102530. - 102531.]
The district may issue bonds, payable in whole or in part from revenue of any facility or enterprise acquired or constructed or to be acquired or constructed by the district, in the manner provided by the Revenue Bond Law of 1941, Chapter 6 (commencing with Section 54300) of Part 1 of Division 2 of Title 5 of the Government Code, all of the provisions of which are applicable to the district, except that Article 3 (commencing with Section 54380) of Chapter 6 of Part 1 of Division 2 of Title 5 of the Government Code and the restrictions therein provided against the securing of bonds by the taxing power or the proceeds of taxation do not apply to the issuance and sale of bonds pursuant to this article and instead, the district shall authorize the issuance of those bonds by resolution of its governing board approved by a two-thirds vote of the board.
The district is a local agency within the meaning of the Revenue Bond Law of 1941, Chapter 6 (commencing with Section 54300) of Part 1 of Division 2 of Title 5 of the Government Code. The term “enterprise” as used in the Revenue Bond Law of 1941 shall, for all purposes of this part, include the system or any or all transit facilities, and all additions, extensions, and improvements thereto, and all other facilities authorized to be acquired, constructed, or completed by the district. Any revenues or other income, receipts, or amounts made available to the district, including, but not limited to, the proceeds of a transactions and use tax imposed under Article 8 (commencing with Section 102350) of Chapter 5 of Division 10 or under any other provision of law, are deemed to be revenues of the enterprise for all purposes of the Revenue Bond Law of 1941. The district may issue revenue bonds under the Revenue Bond Law of 1941, for any one or more transit facilities authorized to be acquired, constructed, or completed by the district or, in the alternative, may issue revenue bonds under the Revenue Bond Law of 1941, for the acquisition, construction, and completion of any one of those transit facilities. Nothing in this article shall prevent the district from availing itself of, or making use of, any procedure provided in this part for the issuance of bonds of any type or character for any of the transit facilities authorized hereunder, and all proceedings may be carried on simultaneously or, in the alternative, as the board may determine.
ARTICLE 3. Equipment Trust Certificates [102550. - 102554.]
The district shall have power to purchase transit equipment such as cars, trolley buses and motorbuses, or rolling equipment, and may execute agreements, leases, and equipment trust certificates in the forms customarily used by private corporations engaged in the transit business appropriate to effect such purchase and leasing of transit equipment, and may dispose of such equipment trust certificates upon such terms and conditions as the board may deem appropriate. Payment for such equipment, or rentals therefor, may be made in installments, and the deferred installments may be evidenced by equipment trust certificates payable from any source or sources of funds specified in such certificates that are or will be legally available to the district; and title to such equipment shall not rest in the district until the equipment trust certificates are paid.
The agreement to purchase or lease may direct the vendor or lessor to sell and assign or lease the rolling equipment to a bank or trust company duly authorized to transact business in the State of California as trustee, for the benefit and security of the equipment trust certificates and may direct such trustee to deliver the rolling equipment to one or more designated officers of the district and may authorize the district to simultaneously therewith execute and deliver an installment purchase agreement or a lease of the equipment to the district.
The agreements and leases shall be duly acknowledged before a person authorized by law to take acknowledgments of deeds and in the form required for acknowledgment of deeds, and such agreements, leases, and equipment trust certificates shall be authorized by resolution of the district and shall contain such covenants, conditions, and provisions which may be deemed necessary or appropriate to insure the payment of the equipment trust certificates from legally available sources or sources of funds specified in such certificates.
The covenants, conditions, and provisions of the agreements, leases, and equipment trust certificates shall not conflict with any of the provisions of any trust agreement securing the payment of bonds, notes, or certificates of the district.
An executed copy of each such agreement and lease shall be filed in the office of the Secretary of State, who will be entitled to receive one dollar ($1) for each such copy filed with him and which filing shall constitute notice to any subsequent judgment creditor or any subsequent purchaser. Each vehicle so purchased or leased shall have the name of the owner or lessor plainly marked on both sides thereof followed by the appropriate words “Owner and Lessor” or “Owner and Vendor,” as the case may be.
ARTICLE 4. Improvement Acts and Special Benefit Districts [102570. - 102571.]
The Improvement Act of 1911, the Municipal Improvement Act of 1913, and the Improvement Bond Act of 1915 are applicable to the district.
Chapter 1 (commencing with Section 99000) of Part 11 applies to the district.
ARTICLE 5. Temporary Borrowing [102581. - 102584.]
At any time prior to the first receipt by the district of revenues from taxation or other sources, any city or county may lend any available money to the district for the purposes of organization and operation. Such expenditures shall constitute a proper expenditure of city and county funds.
The district may borrow money in accordance with the provisions of Article 7 (commencing with Section 53820), Article 7.4 (commencing with Section 53835), Article 7.5 (commencing with Section 53840), Article 7.6 (commencing with Section 53850), or Article 7.7 (commencing with Section 53859) of Chapter 4 of Part 1 of Division 2 of Title 5 of the Government Code.
The district may borrow money in anticipation of the sale of bonds which have been authorized to be issued pursuant to Article 1 (commencing with Section 102500) of this chapter, but which have not been sold and delivered, and may issue negotiable bond anticipation notes therefor and may renew the same from time to time, but the maximum maturity of any such notes, including the renewals thereof, shall not exceed five years from the date of delivery of such original notes. Such notes may be paid from any moneys of the district available therefor and not otherwise pledged. If not previously otherwise paid, the notes shall be paid from the proceeds of the next sale of the bonds of the district in anticipation of which they were issued and if not so paid, taxes may be levied for their payment in the same manner as taxes are levied for the payment of general obligation bonds pursuant to Section 102336 until such bonds are issued. Such notes shall not be issued in any amount in excess of the aggregate amount of bonds which the district has been authorized to issue, less the amount of any bonds of such authorized issue previously sold, and also less the amount of other bond anticipation notes therefor issued and then outstanding. The notes shall be issued and sold in the same manner as the bonds. Such notes and the resolution or resolutions authorizing the same may contain any provisions, conditions, or limitations which a resolution of the district authorizing the issuance of bonds may contain.
In addition to, and as an alternative to, the borrowing authority in Section 102582, the district may seek and obtain a short-term revolving line of credit for operating purposes in anticipation of receipt of federal operating grants, with the extension of credit to the district evidenced by a note, pursuant to a resolution adopted by the board of directors of the district. The district may pledge the anticipated grants and any other funds available to the district, including, but not limited to, fare revenues collected by the district in connection with the operation of its transit system and any other revenues, income, or receipts, as security for repayment of the note, the interest on the note, and the related obligations evidenced by the note. The note shall have a maturity date of not more than 60 months from the date of issuance. The district may pledge anticipated federal operating grants and other available funds over a multiyear period. Notwithstanding the 60-month maturity period for the line of credit, the maximum indebtedness under the note shall not exceed the maximum amount in federal operating grant revenues that the district anticipates receiving in the next fiscal year. Immediately upon receipt thereof, the district shall set aside and apply all amounts received from the pledged federal operating grant revenues to the repayment of any outstanding indebtedness incurred pursuant to this section, and these federal operating grant revenues may not be used for any other purpose until such time as the indebtedness is fully repaid.
ARTICLE 6. Miscellaneous [102600. - 102603.]
The district may bring an action to determine the validity of any of its bonds, equipment trust certificates, warrants, notes or other evidences of indebtedness pursuant to Chapter 9 (commencing with Section 860), Title 10 of Part 2 of the Code of Civil Procedure.
All bonds and other evidences of indebtedness issued by the district under the provisions of this part, and the interest thereon are free and exempt from all taxation within the State of California, except for transfer, franchise, inheritance and estate taxes.
Notwithstanding any other provisions of this part or any other law, the provisions of all ordinances, resolutions and other proceedings in the issuance by the district of any bonds, bonds with a pledge of revenues, bonds for improvement districts, revenue bonds, equipment trust certificates, notes, or any and all evidences of indebtedness or liability shall constitute a contract between the district and the holders of such bonds, equipment trust certificates, notes or evidences of indebtedness or liability, and the provisions thereof shall be enforceable against the district, any or all of its successors or assigns, the state, any department of the state, or any officer thereof, by mandamus or any other appropriate suit, action, or proceeding in law, or in equity, in any court of competent jurisdiction. Nothing contained in this part, or in any other law, shall be held to relieve the district, or the territory included within it, from any bonded or other debt or liability contracted by the district. Upon dissolution of the district or upon withdrawal of territory therefrom, the property formerly included within the district, or withdrawn therefrom, shall continue to be liable for the payment of all bonded and other indebtedness or liabilities outstanding at the time of such dissolution or withdrawal the same as if the district had not been so dissolved, or the territory withdrawn therefrom, and it shall be the duty of the state or other successors or assigns to provide for the payment of such bonded and other indebtedness and liabilities. Except as may be otherwise provided in the proceedings for the authorization, issuance, and sale of any revenue bonds, bonds secured by a pledge of revenues, or bonds for improvement districts secured by a pledge of revenues, revenues of any kind or nature derived from any revenue-producing improvements, works, facilities, or property owned, operated, or controlled by the district shall be pledged, charged, assigned and have a lien thereon for the payment of such bonds as long as the same are outstanding, regardless of any change in ownership, operation, or control of such revenue-producing improvements, works, facilities, or property and it shall, in such later event or events, be the duty of the state or other successors or assigns to continue to maintain and operate such revenue-producing improvements, works, facilities or property as long as bonds are outstanding.
The district shall not incur a total indebtedness under the provisions of this chapter which exceeds 15 percent of the assessed value of all taxable property within the district.
CHAPTER 8. Dissolution [102700. - 102700.]
The district may be dissolved pursuant to the provisions of the District Reorganization Act of 1965 (Division 1 (commencing with Section 56000), Title 6 of the Government Code).
PART 15. SAN MATEO COUNTY TRANSIT DISTRICT [103000. - 103700.]
CHAPTER 1. Title of Act and Policy [103000. - 103001.]
This part shall be known and may be cited as the “San Mateo County Transit District Act.”
It is necessary that a transit district be established in the County of San Mateo in order to meet the public transit problems of that county. Because there is no general law under which such a district could be formed, the adoption of a special act and the formation of a special district is required.
CHAPTER 2. Definitions [103010. - 103022.]
Unless the context otherwise requires, the provisions of this chapter govern the construction of this part.
“District” means the San Mateo County Transit District.
“Transit” or “transit service” means the transportation of passengers and their incidental baggage and parcels by any means.
“Transit works” or “transit facilities” means any or all real and personal property, equipment, rights, or interests owned, or to be acquired, by the district for transit service or purposes.
“Board of directors”, “board”, or “directors” means the board of directors of the district.
“County” means the County of San Mateo.
“Board of supervisors” means the county board of supervisors.
“Public agency” includes the State of California, and any county, city, district, or other political subdivision or public entity of, or organized under the laws of, this state, or any department, instrumentality, or agency thereof.
“System” means all transit works and transit facilities owned or held, or to be owned or held, by the district for transit purposes.
“Revenues” means all rates, fares, tolls, rentals, or other income and revenue actually received or receivable by, or for the account of, the district from the operation of the system, including, without limiting the generality of the foregoing, interest allowed on any moneys or securities any profits derived from the sale of any securities, and any consideration in any way derived from any properties owned, operated, or at any time maintained by the district.
“Person” includes any individual, firm, partnership, association, corporation, limited liability company, trust, business trust, or the receiver or trustee or conservator for any thereof, but does not include a public agency, as defined in Section 103016.
“Establish” includes establish, construct, complete, acquire, extend, or reroute. It does not, however, include the maintenance and operation of any existing system acquired by the district.
“Existing system” means any transit service or system of a publicly or privately owned public utility, or division thereof, which was operating on January 1, 1974, entirely within the county, or which operated at least 75 percent of its revenue vehicle miles for 1973 within the county, but does not include a charter-party carrier or the charter service of a passenger stage corporation.
“Existing taxi service” means any public passenger transportation service which (1) is not subject to the jurisdiction, control, and regulation of the Public Utilities Commission, (2) is available for hire on an exclusive or shared-ride basis, (3) is on call or demand over the public streets within the county in a motor vehicle of distinctive color or insignia equipped with a taximeter which is demand activated and operated by a licensed driver at the direction of passengers, and (4) was operating on January 1, 1974.
CHAPTER 3. Formation of District [103050. - 103085.]
ARTICLE 1. General Provisions [103050. - 103053.]
The San Mateo County Transit District may be formed as provided in this chapter and, when so formed, may exercise the powers herein granted.
The district shall include all the incorporated and unincorporated territory lying within the county.
The board of supervisors may, after notice published pursuant to Section 6061 of the Government Code and public hearing, adopt a resolution declaring that, in its opinion, public interest or necessity demands the formation of the San Mateo County Transit District.
The district shall not be subject to the Knox-Nisbet Act (Chapter 6.6 (commencing with Section 54773), Part 1, Division 2, Title 5 of the Government Code), except as to dissolution proceedings under Chapter 8 (commencing with Section 103700).
ARTICLE 2. Formation Election [103070. - 103079.]
Upon adoption of the resolution provided for in Section 103052, the board of supervisors shall adopt a resolution calling an election within the proposed district for the purpose of determining whether the proposed district shall be formed.
The resolution calling the formation election shall be published pursuant to Section 6061 of the Government Code. The resolution shall:
Call and provide notice of the special election.
Fix a date of election.
State the question to be submitted to the voters pursuant to Section 103072.
Contain such other matters as may be necessary to call and provide notice of such election, and to provide for the conduct and the canvass of the returns thereof.
The ballot for the election shall contain such instructions as are required by law to be printed thereon and, in addition thereto, the following:
The county registrar of voters shall mail a notice of polling place, and the date and purpose, of the election to each registered voter of the county.
The provisions of Article 3 (commencing with Section 9160) of Chapter 2 of Division 9 of the Elections Code relating to ballot arguments and analyses shall be applicable to the formation election.
The general elections provisions of the Elections Code, as far as they may be applicable, relating to the qualifications of voters, the manner of voting, the form of the ballot, the duties of precinct and election officers, the canvassing of returns, and all other particulars shall govern the election.
No person shall be entitled to vote at the election unless he is a registered voter of the county.
The county registrar of voters shall canvass the returns and certify the election results to the board of supervisors.
The board of supervisors shall make all provisions for the holding of the election throughout the district as proposed, and the cost of the election shall be a charge against the general funds of the county.
If a majority of the electors voting on the proposition vote in favor of the formation of the district, the board of supervisors shall adopt an order declaring the result of the election and declaring the district to be formed, and shall cause a certified copy of such order to be filed with the Secretary of State, at which time the formation of the district shall be deemed complete.
ARTICLE 3. Contest of Validity of Formation [103085. - 103085.]
No informality in any proceeding or in the conduct of the election, not substantially affecting adversely the legal rights of any citizen, shall be held to invalidate the formation of the district. Any proceedings wherein the validity of the formation is denied shall be commenced within 90 days from the date of filing the order declaring the result of the election with the Secretary of State. Otherwise, the formation and the legal existence of the district shall be held to be valid and incontestable.
CHAPTER 4. Government of District [103100. - 103180.]
ARTICLE 1. Board of Directors [103100. - 103113.]
The government of the district shall be vested in a board of directors, which shall consist of nine members, selected as follows:
Three members, two of whom shall, at the time of their appointments and during their service as directors, be members of the board of supervisors and one of whom shall possess expertise in the field of transportation, appointed by the board of supervisors.
Three members, all of whom shall be city council members at the time of their appointments and during their service as directors, appointed by the city selection committee created pursuant to Article 11 (commencing with Section 50270), Chapter 1, Part 1, Division 1, Title 5 of the Government Code.
Three members, one of whom shall be a resident of the coastal zone as defined in Section 27100 of the Public Resources Code, at the time of their appointments and during their service as directors, appointed by the six members appointed pursuant to subdivisions (a) and (b).
Within 30 days after the adoption of the order declaring the district formed, the members of the board of directors appointed pursuant to subdivisions (a) and (b) of Section 103100 shall meet in the chambers of the board of supervisors. The date of the first meeting shall be prescribed by the clerk of the board of supervisors. At that meeting, the three members to be appointed pursuant to subdivision (c) of Section 103100 shall be appointed.
The board at its first meeting, and thereafter annually at the first meeting in January, shall elect a chairman who shall preside at all meetings, and a vice chairman who shall preside in his absence. In the event of their absence or inability to act, the members present, by an order entered in the minutes, shall select one of their members to act as chairman pro tem, who, while so acting, shall have all of the authority of the chairman.
The board shall establish rules for its proceedings.
A majority of the members of the board shall constitute a quorum for the transaction of business, and all official acts of the board shall require the affirmative vote of a majority of the members of the board.
The acts of the board shall be expressed by motion, resolution, or ordinance.
All meetings of the board shall be conducted in the manner prescribed by the Ralph M. Brown Act (Chapter 9 (commencing with Section 54950), Part 1, Division 2, Title 5 of the Government Code).
Except for the terms of office of the members of the first board, the term of office of each member shall be four years and until the appointment and qualification of his successor. The members of the first board shall classify themselves by lot so that the term of office of four members is two years and of five members is four years.
The expiration date of the term of office of each member shall be the 31st day of December in the year in which his term is to expire.
The body which originally appointed a member whose term has expired shall appoint his successor for a full term of four years.
Any vacancy on the board shall be filled for the unexpired term by appointment by the body which originally appointed the member whose office has become vacant.
Each member of the board shall receive compensation, as determined by the board, in an amount not to exceed one hundred dollars ($100) for attending each meeting of the board and each committee meeting, but not to exceed four hundred dollars ($400) in any month, and shall receive his or her actual necessary expenses incurred in the performance of his or her duty.
ARTICLE 2. Powers and Duties of Board of Directors [103140. - 103141.]
The board is the legislative body of the district and shall determine all questions of district policy.
It shall be the duty of the board and it shall have the power to:
Determine the transit facilities to be acquired and constructed by the district, the manner of operation, and the means to finance them.
Adopt an annual budget for the district and fix the compensation of its officers and employees.
Fix rates, rentals, charges, and classifications of transit service operated by the district.
Adopt an administrative code, by ordinance, which shall prescribe the powers and duties of district officers, the method of appointment of district employees, and methods, procedures, and systems of operation and management of the district.
Adopt by ordinance, rules and regulations governing the use of transit facilities owned or operated by the district.
Cause a postaudit of the financial transactions and records of the district to be made at least annually by a certified public accountant.
Appoint such advisory commissions as it deems necessary.
Do any and all things necessary to carry out the purposes of this part.
ARTICLE 3. Officers [103160. - 103162.]
The officers of the district shall consist of the members of the board, the chairman of the board, a secretary, a general manager, a legal counsel, a controller, a treasurer, and such other officers, assistants and deputies as the board may deem necessary and provide for by ordinance.
The county may render such assistance to the district as it may require, including the performance by officers of the county as ex officio officers of the district, of the functions of general manager, legal counsel, controller, and treasurer. The district shall reimburse the county for the services performed by the county to the district.
Article 4 (commencing with Section 1090), Chapter 1, Division 4, and Division 4.5 (commencing with Section 3600), of Title 1 of the Government Code shall apply to all officers, employees, and contracts of the district.
ARTICLE 4. General Manager [103180. - 103180.]
The powers and duties of the general manager are:
To head the administrative branch of the district and to be responsible to the board for the proper administration of all affairs of the district.
To appoint, supervise, suspend, or remove district officers other than members of the board and officers appointed by the board.
To supervise and direct the preparation of the annual budget for the board and be responsible for its administration after its adoption.
To formulate and present to the board plans for transit facilities within the district and the means to finance them.
To supervise the planning, acquisition, construction, maintenance, and operation of the transit facilities of the district.
To prepare and submit to the board, as soon as practicable after the end of each fiscal year, a complete report of the finances and administrative activities of the district for the preceding year.
To perform such other and additional duties as the board may require.
CHAPTER 5. Powers and Functions of District [103200. - 103399.11.]
ARTICLE 1. Corporate Powers [103200. - 103204.]
The district has perpetual succession and may adopt a seal and alter it at its pleasure.
The district may sue and be sued, except as otherwise provided by law, in all actions and proceedings, in all courts and tribunals of competent jurisdiction.
All claims for money or damages against the district are governed by Division 3.6 (commencing with Section 810) of Title 1 of the Government Code except as provided therein, or by other statutes or regulations expressly applicable thereto.
The district may levy and collect, or cause to be collected, taxes for any lawful purpose, as provided by law.
Except as otherwise provided in this part, district elections shall be called, held, and conducted as provided by law for county elections.
ARTICLE 2. Contracts [103220. - 103226.]
The district may make contracts and enter into stipulations of any nature whatsoever, either in connection with eminent domain proceedings or otherwise, including, without limiting the generality of the foregoing, contracts and stipulations to indemnify and save harmless, to employ labor, and to do all acts necessary and convenient for the full exercise of the powers granted in this part.
The district may contract with any department or agency of the United States of America, with any public agency, or with any person upon such terms and conditions as the board finds is for the best interest of the district.
The purchase of all supplies, equipment, and materials, when the expenditure required exceeds one hundred fifty thousand dollars ($150,000), shall be by contract let to the lowest responsible bidder, or, in the district’s discretion, to the responsible bidder who submitted a proposal that provides the best value to the district on the basis of the factors identified in the solicitation. “Best value” means the overall combination of quality, price, and other elements of a proposal that, when considered together, provide the greatest overall benefit in response to the requirements described in the solicitation documents.
To the extent practicable, the district shall obtain a minimum of three quotations, either written or oral, that permit prices and terms to be compared whenever the expected expenditure required for the purchase of supplies, equipment, or materials exceeds five thousand dollars ($5,000), but does not exceed one hundred fifty thousand dollars ($150,000).
Notice requesting bids required by this section shall be published at least once in a newspaper of general circulation and on the district’s procurement Internet Web site. These publications shall be made at least 10 days before the bids are received. The board may reject any and all bids and readvertise at its discretion.
This section applies solely to the procurement of supplies, equipment, and materials, and shall not apply to construction contracts.
If, after rejecting bids received under Section 103222, the board determines and declares by a two-thirds vote of all of its members that, in its opinion, the supplies, equipment, or materials may be purchased at a lower price in the open market, the board may proceed to purchase these supplies, equipment, or materials in the open market without further observance of the provisions regarding contracts, bids, or advertisements.
The district may insure against any accident or destruction of the system or any part thereof. The district may insure against loss of revenues from any cause whatsoever. It may provide, in the proceedings authorizing the issuance of any bonds, for the carrying of insurance in such amount and of such character as may be specified, and for the payment of the premiums thereon. The district may also provide insurance as provided in Part 6 (commencing with Section 989), Division 3.6, Title 1 of the Government Code.
The district may contract for the services of independent contractors.
ARTICLE 3. Property [103240. - 103244.]
The district may take by grant, purchase, devise, or lease, or condemn in proceedings under eminent domain, or otherwise acquire, and hold and enjoy, real and personal property of every kind within or without the district necessary to the full or convenient exercise of its powers. The board may lease, mortgage, sell, or otherwise dispose of any real or personal property within or without the district necessary to the full or convenient exercise of its powers.
The district may take by gift, or take or convey by grant, purchase, devise, or lease, and hold and enjoy, real and personal property of every kind within or without the district necessary for, incidental to, or convenient for, transit-oriented joint development projects that meet the definition and requirement set forth in subdivision (b).
For purposes of this section, a transit-oriented joint development project is a commercial, residential, or mixed-use development that is undertaken in connection with existing, planned, or proposed intermodal transit facilities and is located 14 mile or less from the external boundaries of that facility.
Any transit-oriented joint development project created under this section shall comply with the land use and zoning regulations of the city, county, or city and county in which the project is located.
Notwithstanding Section 103265 or any other provision of law, the authority granted under this section is subject to the land use and zoning regulations of the city, county, or city and county jurisdiction in which the transit-oriented joint development is located, in accordance with the Planning and Zoning Law (Title 7 (commencing with Section 65000) of the Government Code), relating to zoning.
The authority granted under this section extends to any joint powers agency of which the district is a member and for which the district serves as the managing agency.
The district may exercise the right of eminent domain to take any property necessary or convenient to the exercise of the powers granted in this part. The district, in exercising such power, shall, in addition to the damages for the taking, injury, or destruction of property, also pay the cost, exclusive of betterment and with credit for salvage value, of removal, reconstruction, or relocation of any structure, railways, mains, pipes, conduits, wires, cables, or poles of any public agency or utility which is required to be moved to a new location.
The Public Utilities Commission of the state shall have and exercise power and jurisdiction to fix just compensation to be paid for the taking of any property of a public utility in eminent domain proceedings brought by the district. No taking or acquisition by the district which would involve the abandonment, removal, relocation, or use of the property of a railroad corporation, as defined in Section 230, shall be permitted, unless the Public Utilities Commission, after a hearing, shall find and determine that the public interest and necessity require the abandonment, removal, relocation, or use of such property and that such taking or acquisition will not unreasonably impair the ability of the railroad corporation involved to provide safe, adequate, economical, and efficient service. The district may commence and maintain such eminent domain proceedings in the Public Utilities Commission or the superior court at its option.
The district is entitled to the benefit of any reservation or grant, in all cases, where any right has been reserved or granted to any public agency to construct or maintain roads, highways, or other crossings over any public or private lands.
ARTICLE 4. Transit Planning [103260. - 103265.]
The board shall adopt a general transit plan for the district.
The general transit plan, or any element or amendment thereof, shall be adopted in the manner provided in this article.
The general manager shall submit the proposed plan, or an element or amendment thereof, to the board which shall hold a public hearing thereon. Notice of the time and place of the hearing shall be given at least 30 days before the hearing. The notice shall be published pursuant to Section 6061 of the Government Code, and written notice shall also be mailed to each city council in the county. The hearing may be continued from time to time.
The adoption of the general plan, or an element or amendment thereof, including any changes or additions, shall be by resolution of the board.
The district may adopt official plan lines based on the adopted general plan designating the precise location of planned rights-of-way of transit works and facilities. Official plan lines shall be adopted in the same manner as required for the adoption of the general plan.
The provisions of Article 5 (commencing with Section 53090), Chapter 1, Part 1, Division 2, Title 5 of the Government Code shall not be applicable to the district.
ARTICLE 5. Transit Facilities and Service [103280. - 103290.]
The district may provide transit service within or without the district for the transportation of passengers and their incidental baggage and parcels by any means.
The district may operate charter bus service subject to the following limitations:
No bus equipment which is designed solely for charter service shall be purchased. A bus equipped with a toilet or underfloor baggage compartment shall be deemed charter equipment.
The board shall hold a public hearing prior to adopting a charter rate schedule or any amendment thereof. Notice of the hearing shall be mailed to each charter-party carrier operating within the district at least 30 days prior to the hearing. The notice shall include the proposed charter rate schedule. At the close of the public hearing, the board may adopt charter rate schedules which shall not be less than the average for the three largest private charter-party carriers operating similar service in the district.
Charter service shall originate and terminate within the area served by the district unless a private charter-party carrier requests the district to provide service beyond the area served by the district.
The district may acquire, construct, own, operate, control, or use rights-of-way, rail lines, buslines, stations, platforms, switches, yards, terminals, parking lots, and any and all facilities necessary or convenient for transit service within or without the district, underground, upon, or above the ground and under, upon, or over public streets or other public ways or waterways, together with all physical structures necessary or convenient for the access of persons or vehicles thereto, and may acquire any interest in, or rights to, the use or joint use of any or all of the foregoing.
The district may lease, or contract for the use of, its transit facilities, or any portion thereof, to any operator, and may provide for subleases by such operator upon such terms and conditions as it deems in the public interest. The word “operator,” as used in this section, means any public agency or any person.
The board may contract with any public agency or person to provide transit facilities and services for the district.
The district may construct and operate, or acquire and operate, transit works and facilities in, under, upon, over, across, or along any state or public highway, or any stream, bay, or watercourse, or over any of the lands which are the property of the state, to the same extent that such rights and privileges appertaining thereto are granted to municipalities within the state.
The district may enter into agreements for the joint use of any property and rights by the district and any public agency or public utility operating transit facilities and may enter into agreements with any public agency or public utility operating any transit facilities, wholly or partially within or without the district, for the joint use of any property of the district or of such public agency or public utility, or the establishment of through routes, joint fares, transfer of passengers, or pooling arrangements.
The rates and charges, if any, for transit service furnished pursuant to this part shall be fixed by the board and shall be reasonable.
The district shall be subject to the provisions of Division 14.8 (commencing with Section 34500) of the Vehicle Code with respect to the operation of buses and to the rules and regulations enforceable by the Department of the California Highway Patrol pursuant to that chapter regulating the safe operation of buses.
The district and any one or more school districts located within the district may enter into agreements pursuant to which school transportation equipment may be used for transit purposes within the district during any time that such equipment is not actually required for school purposes.
No interconnection shall be made into fixed right-of-way facilities of the San Francisco Bay Area Rapid Transit District without the approval of the voters of the district at an election called for the purpose of securing such approval. Any fixed right-of-way facilities shall be in compliance with Section 66515.5 of the Government Code.
ARTICLE 6. Existing Systems and Services [103300. - 103303.]
Notwithstanding any other provision of this part, before the district may establish any transit service or system which may significantly divert, lessen, or compete for the patronage or revenues of any existing system, other than an existing taxi service, the district shall give a written notice to the public utility or public agency which is operating the existing system. The written notice shall describe the transit service or system which the district proposes to establish and shall state the time within which the district proposes to establish such service or system.
Where notice is required pursuant to Section 103300, the district shall not establish the proposed service or system, or maintain and operate the service or system, until it has completed the purchase of any existing system or any part thereof.
Notwithstanding any other provision of this part, before the district may establish any demand-activated service or system which may, at any time, divert, lessen, or compete for the patronage or revenues of any existing taxi service, the district shall give a written notice to that service. The written notice shall describe the demand-activated service or system which the district proposes to establish and shall state the time within which the district proposes to establish such service or system.
If any demand-activated service or system operated by the district diverts or lessens the patronage or revenues of any existing taxi service by causing a loss of patronage or revenues in the affected service area of any existing taxi service to the extent of 10 percent or more, the district shall not continue its demand-activated service or system, or maintain and operate the service or system, until it has completed the purchase of any existing taxi service or any part thereof. No purchase of an existing taxi service, or part thereof, need be made by the district as a result of the establishment or operation by the district of any service or system other than a demand-activated service or system.
The district and entity operating the existing system or the existing taxi service may agree upon the purchase price or they may agree that the purchase price is to be established by arbitration and upon the method of naming arbitrators and the method of conducting such arbitration.
Section 851 shall not apply to any contract for sale or sale of an existing system or existing taxi service, or any portion thereof, pursuant to this chapter, and the Public Utilities Commission shall have no jurisdiction with respect thereto.
ARTICLE 7. Public Grants, Loans, and Contributions [103310. - 103311.]
The district may accept, without limitation by any other provisions of this part requiring approval of indebtedness, contributions, grants, or loans from any public agency or the United States or any department, instrumentality, or agency thereof, for the purpose of financing the acquisition, construction, maintenance, or operation of transit facilities, and may enter into contracts and cooperate with, and accept cooperation from, any public agency or the United States, or agency thereof, in the acquisition, construction, maintenance, or operation of any such transit facilities in accordance with any legislation which Congress or the Legislature of the State of California may have heretofore adopted or may hereafter adopt, under which aid, assistance, and cooperation may be furnished by the United States or any public agency in the acquisition, construction, maintenance, and operation of any such transit facilities. The district may do any and all things necessary in order to avail itself of such aid, assistance, and cooperation under any federal or state legislation now or hereafter enacted. Any evidence of indebtedness issued under this section shall constitute a negotiable instrument.
The district shall have the power to obtain temporary transfers of funds in accordance with the last paragraph of Section 6 of Article XVI of the California Constitution.
ARTICLE 8. Property Taxation [103320. - 103333.]
The district may levy and collect, or cause to be collected, property taxes for any lawful purpose.
In addition to revenues and receipts from other sources, the board may levy and collect a property tax.
The district shall not levy or collect a property tax unless a majority of the voters voting on the question at an election called for such purpose approves the levy of a property tax by the district.
Each election shall be called and conducted by the district in the same manner as provided by law for the conduct of special elections by a county. The board may contract with the county, or delegate to the appropriate county officials the authority, to conduct the election on behalf of the district. The costs of any such election may be advanced to the district by the county prior to the time that the district has revenues of its own, to be repaid from subsequent district revenues.
The ballot for the election shall contain such instructions as are required by law to be printed thereon and in addition thereto, the following:
The board shall avail itself of the assessments made by the county assessor and of the assessments made by the State Board of Equalization for the county, and shall take such assessments as the basis for district property taxation and have its property taxes collected by the county tax collector.
The county auditor shall, on or before the third Monday in August of each year, transmit to the board a statement in writing showing the total value of all property within the district.
The board shall, on or before the first day of September, fix the rate or rates of taxes, designating the number of cents upon each one hundred dollars ($100), and use as a basis the value of property transmitted to the board by the county auditor, which rate of taxation shall be sufficient to raise the amount previously fixed by the board.
The board shall, immediately after fixing the rate or rates of taxes, transmit to the county auditor a statement of the rate of taxes fixed by the board.
The district’s taxes so levied shall be collected at the same time and in the same manner as county taxes. When collected, the net amount, ascertained as provided in this article, shall be paid to the treasurer of the district under the general requirements and penalties provided by law for the settlement of other taxes.
Whenever any real property has been sold for taxes and has been redeemed, the money paid for redemption shall be apportioned and paid to the district by the county treasurer in the proportion which the tax due to the district bears to the total tax for which the property was sold.
All taxes levied under this article are a lien on the property on which they are levied. The enforcement of the collection of such taxes shall be in the same manner and by the same means provided by law for the enforcement of liens for county taxes, all the provisions of law relating to the enforcement of the latter being made a part of this article so far as applicable.
In lieu of, or in addition to, any taxes which may be levied by the district pursuant to this article, any city council within the district or the board of supervisors may enter into agreement with the district to make annual contributions to the district from its general funds or from any other source of funds legally available to it for such purpose.
ARTICLE 9. Taxation for Bond Redemption Purposes [103340. - 103348.]
The district may levy and collect, or cause to be collected, property taxes, for bond redemption purposes.
Except as otherwise provided in subdivision (b), if from any cause the revenues of the district are, or are expected to be, inadequate in any year to pay the principal of, interest on, or sinking fund payments for bonds of the district as they become due, or to establish or maintain any reserve fund therefor, the board shall levy for district purposes and collect upon all property in the district taxable for county purposes a tax sufficient, together with revenues already collected and available therefor, to pay the interest on the bonds as they will become due and such part of the principal thereof, including any sinking fund installments required by any of the district’s agreements with its bondholders, that will become due before the proceeds of a tax levied at the next general tax levy will be available for such purpose, and sufficient to provide or to restore such reserve fund to the amount required by any of the district’s agreements with its bondholders.
If the ordinance calling the election on the issuance of bonds provides that all or any portion of the retail transaction and use tax authorized under Article 10 (commencing with Section 103350) be levied and used to the extent required to pay principal of and interest on the bonds, the board, in order to provide for any sinking fund payments required therefor and to create or maintain any reserve fund required therefor, shall estimate the revenues of the district which are expected to be available for such purposes and the amount to be raised by such a tax as is required to be levied and used for such purposes in order to provide for the payment of all such obligations when due. The board may, in its regular annual budget, or in a special budget which may be prepared at any time, show the amounts needed for such purposes, estimate the revenue available therefor, and thereafter fix the rates of and levy and collect, or provide for the collection of, such a tax as will provide, together with other revenues available therefor, at least all sums necessary for such purposes insofar as such levies do not exceed the maximum rates of such a tax stated in the ordinance calling the bond election.
If from any cause the revenues of the district are, or are expected to be, inadequate to pay the principal of and interest on the bonds and sinking fund payments as they become due, and establish or maintain any reserve fund required therefor, and if the proceeds of such tax levied at the maximum rates authorized, together with such revenues, are still estimated to be insufficient for such purposes, the board shall levy and collect upon all property in the district taxable for county purposes a tax at least sufficient, with the revenues already collected and available therefor, together with the anticipated proceeds of the special tax, to pay the interest on the bonds that will become due and such part of the principal thereof, including any sinking fund payments, that will become due before the proceeds of a tax levied at the time of the next general tax levy will be available for such purposes, and sufficient to provide or to restore such reserve fund to the amount required by any of the district’s agreements with its bondholders.
The board shall avail itself of the assessments made by the assessor of the county and of the assessments made by the State Board of Equalization for the county, and shall take such assessments as the basis for district property taxation and have its property taxes collected by the tax collector of the county.
The county auditor shall, on or before the third Monday in August of each year, transmit to the board a statement in writing showing the total value of all property within the district, ascertained from the assessments referred to in Section 103326.
The board shall, on or before the first day of September, fix the rate of taxes, designating the number of cents upon each one hundred dollars ($100), and use as a basis the value of property transmitted to the board by the county auditor, which rate of taxation shall be sufficient to raise the amount previously fixed by the board.
The board shall, immediately after fixing the rate of taxes, transmit to the county controller a statement of the rate of taxes fixed by the board.
The district’s taxes so levied shall be collected at the same time and in the same manner as county taxes. When collected, the net amount, ascertained as provided in this article, shall be paid to the treasurer of the district under the general requirements and penalties provided by law for the settlement of other taxes.
Whenever any real property has been sold for taxes and has been redeemed, the money paid for redemption shall be apportioned and paid to the district by the county controller pursuant to provisions of the Revenue and Taxation Code.
All taxes levied under this article are a lien on the property on which they are levied. The enforcement of the collection of such taxes shall be in the same manner and by the same means provided by law for the enforcement of liens for county taxes, all the provisions of law relating to the enforcement of the latter being made a part of this article so far as applicable.
ARTICLE 10. Retail Transaction and Use Tax [103350. - 103363.]
A retail transactions and use tax ordinance may be adopted by the board in accordance with Part 1.6 (commencing with Section 7251) of Division 2 of the Revenue and Taxation Code and consistent with Article XIII C of the California Constitution.
The board may impose a retail transactions and use tax pursuant to subdivision (a) that, in combination with all taxes imposed in accordance with Part 1.6 (commencing with Section 7251) of Division 2 of the Revenue and Taxation Code, exceeds the limit established in Section 7251.1 of the Revenue and Taxation Code, if both of the following requirements are met:
The tax is set at a rate of no more than 0.5 percent.
The board adopts the ordinance approving the tax before January 1, 2026.
For purposes of a new tax imposed pursuant to subdivision (b), the board, in concurrence with the County of San Mateo, shall develop an expenditure plan of projects, programs, and services that may include, among other things, public transit, local streets and roads, state highways, bicycle and pedestrian facilities, intelligent transportation systems, and transportation planning.
The board may administer the expenditure plan in its entirety, or may transfer proceeds of the tax to the San Mateo County Transportation Authority for administration by that authority consistent with the expenditure plan.
The board shall not act pursuant to subdivision (b) if a transactions and use tax has been imposed pursuant to Section 7295 of the Revenue and Taxation Code.
Any transactions and use tax ordinance adopted shall be operative on the first day of the first calendar quarter commencing not less than 180 days after adoption of the ordinance.
The district may contract with the State Board of Equalization for its services in the preparation necessary to administer a transaction and use tax ordinance. The costs to be covered by the contract are to be for services of the types described in Section 7272 of the Revenue and Taxation Code for preparatory work up to the date of the adoption of the ordinance. Any disputes as to the amount of the costs shall be resolved in the same manner as provided in that section.
Prior to the operative date of the transaction and use tax ordinance, the district shall contract with the State Board of Equalization to perform all functions incident to the administration and operation of the ordinance.
If the district shall not have contracted with the State Board of Equalization prior to the operative date of its transaction and use tax ordinance, it shall nevertheless so contract, and, in such case, the operative date shall be the first day of the first calendar quarter following the execution of the contract.
Repeal of the transactions and use tax ordinance shall not be operative earlier than the first day of the first calendar quarter following the adoption of the ordinance of repeal.
Whenever a bond election is held to authorize a bonded indebtedness pursuant to Section 103500, the ordinance calling the election may include a statement that the transaction and use taxes, or a stated portion thereof, shall be levied, or continued to be levied, and used to the extent required to pay the principal of, and interest on, the bonds as they become due, to provide any sinking fund payments required therefor, and to create or maintain any reserve fund required therefor.
A vote in favor of the issuance of the bonds shall authorize the use of such taxes for such purposes. The transactions and use tax ordinance shall not be repealed until all bonds payable from the revenues derived from such taxes have been fully paid or provision has been made for their payment in full.
The district may issue bonds payable from the proceeds of the retail transactions and use tax.
The maximum bonded indebtedness which may be outstanding at any one time shall be an amount equal to the sum of the principal of, and interest on, the bonds, but not to exceed the estimated proceeds of the transactions and use tax , as determined by the district. The amount of bonds outstanding at any one time does not include the amount of any bonds or refunding bonds for which moneys or securities necessary to provide for the payment thereof have been set aside for that purpose in a trust or escrow account.
The bonds may be issued by the district at any time, and from time to time, payable from the proceeds of the tax. The bonds shall be referred to as “limited tax bonds.” The bonds may be secured by a pledge of revenues from the proceeds of the retail transactions and use tax or any other funds or assets of the district as may be specified by the district.
The pledge of retail transactions and use taxes to the limited tax bonds authorized under this article shall have priority over the use of any of the taxes for “pay-as-you-go” financing, except to the extent that the priority is expressly restricted in the resolution authorizing the issuance of the bonds.
A pledge by or to the district of tax receipts, revenues, moneys, accounts, accounts receivable, contract rights, and other rights to payment of whatever kind made by or to the district shall be valid and binding from the time the pledge is made for the benefit of pledgees and successors thereto. The tax receipts, revenues, moneys, accounts, accounts receivable, contract rights, and other rights to payment of whatever kind pledged by or to the district or the assignees shall immediately be subject to the lien of the pledge without physical delivery or further act. The lien of the pledge shall be valid and binding against all parties, regardless of whether the parties have notice of the claim. The indenture, trust agreement, resolution, or another instrument by which the pledge is created need not be recorded.
The district may provide for the bonds to bear a variable interest rate, for the manner and intervals in which the rate shall vary, and for the dates on which the interest shall be payable. In connection with the issuance of bonds, the district may enter into any agreement for liquidity or credit enhancement that may be necessary or desirable, as determined by the district.
Limited tax bonds shall be issued pursuant to a resolution adopted at any time, and from time to time, by the district by a two-thirds vote of all members of the board of the district.
The district may, from time to time, issue bonds in accordance with the Revenue Bond Law of 1941 (Chapter 6 (commencing with Section 54300) of Part 1 of Division 2 of Title 5 of the Government Code), for the purposes set forth in Section 103282, which shall constitute an “enterprise” within the meaning of Section 54309 of the Government Code, and the proceeds of the retail transactions and use tax shall constitute “revenues” within the meaning of Section 54315 of the Government Code. Article 3 (commencing with Section 54380) of Chapter 6 of Part 1 of Division 2 of Title 5 of the Government Code and the limitations set forth in subdivision (b) of Section 54402 and in Sections 54403 and 54418 of the Government Code do not apply to the issuance and sale of bonds pursuant to this article. Instead, the district shall authorize the issuance of bonds by resolution, which resolution shall specify all of the following:
The purposes for which the bonds are to be issued, which may be general.
The maximum principal amount of the bonds.
The maximum term for the bonds.
The maximum rate of interest to be payable upon the bonds, which shall not exceed the maximum rate permitted for bonds of the district by Section 53531 of the Government Code or any other applicable provisions of law. In the case of bonds bearing a variable interest rate, the variable rate shall on no day exceed the maximum rate permitted for bonds of the district on that day by Section 53531 of the Government Code or any other applicable provisions of law. However, the variable interest rate so permitted may on any day exceed that maximum rate if the interest paid on the bonds from their date of original issuance on that day does not exceed the total interest which would have been permitted to have been paid on the bonds if the bonds had borne interest at all times from the date of issuance to that day at the maximum rate permitted from time to time by Section 53531 of the Government Code or any other applicable provisions of law.
The maximum discount or premium on the sale of bonds. The bonds may be sold at less or more than the principal amount thereof in the manner and to the extent determined by the district.
For purposes of the issuance and sale of bonds pursuant to this article, the following definitions are applicable to the Revenue Bond Law of 1941:
Each resolution shall provide for the issuance of bonds in the amounts as may be necessary, until the full amount of the bonds authorized has been issued. The full amount of bonds may be divided into two or more series with different dates of payment fixed for the bonds of each series. A bond need not mature on its anniversary date.
The district may issue refunding bonds to redeem or retire any bonds issued by the district upon the terms, at the times, and in the manner which it determines.
Refunding bonds may be issued in a principal amount sufficient to pay all, or any part of, the principal of the outstanding bonds, the premiums, if any, due upon call and redemption thereof prior to maturity, all expenses of the refunding, and either of the following:
The interest upon the refunding bonds from the date of sale thereof to the date of payment of the bonds to be refunded out of the proceeds of the sale of the refunding bonds or to the date upon which the bonds to be refunded will be paid pursuant to call or agreement with the holders of the bonds.
The interest upon the bonds to be refunded from the date of sale of the refunding bonds to the date of payment of the bonds to be refunded or to the date upon which the bonds to be refunded will be paid pursuant to call or agreement with the holders of the bonds.
The provisions of this article for the issuance and sale of bonds apply to the issuance and sale of refunding bonds.
The district may borrow money in anticipation of the sale of bonds which have been authorized pursuant to this article but which have not been sold or delivered, and may issue negotiable bond anticipation notes therefor and may renew the bond anticipation notes from time to time. However, the maximum maturity of any bond anticipation notes, including the renewals thereof, shall not exceed five years from the date of delivery of the original bond anticipation notes.
The bond anticipation notes, and the interest thereon, may be paid from any money of the district available therefor, including the revenues from the retail transactions and use tax. If not previously otherwise paid, the bond anticipation notes, or any portion thererof, or the interest thereon, shall be paid from the proceeds of the next sale of the bonds of the district in anticipation of which the notes were issued.
The bond anticipation notes shall not be issued in any amount in excess of the aggregate amount of the bonds which the district has been authorized to issue, less the amount of any bonds of the authorized issue previously sold, and also less the amount of other bond anticipation notes therefor issued and then outstanding. The bond anticipation notes shall be issued and sold in the same manner as the bonds.
The bond anticipation notes and the resolutions authorizing them may contain any provisions, conditions, or limitations which a resolution of the district may contain.
Any bonds issued pursuant to this article are legal instruments for all trust funds; for the funds of insurance companies, commercial and savings banks, and trust companies; and for state school funds. Whenever any money or funds may, by any law now or hereafter enacted, be invested in bonds of cities, counties, school districts, or other districts within the state, those funds may be invested in the bonds issued pursuant to this article, and whenever bonds of cities, counties, school districts, or other districts within this state, may, by any law now or hereafter enacted, be used as security for the performance of any act or the deposit of any public money, the bonds issued pursuant to this article may be so used. The provisions of this article are in addition to all other laws relating to legal investment and shall be controlling as the latest expression of the Legislature with respect thereto.
This article provides a complete, additional, and alternative method for doing what is authorized by this article and shall be regarded as supplemental and additional to the powers conferred by any other laws. The issuance of bonds and the entering into any credit reimbursement or other agreement under this article need not comply with the requirements of any other law applicable to the district or the issuance of bonds or the incurring of indebtedness. Bonds issued by the district prior to the effective date of the act which enacted this section which were subject to investigation, reports, and approval or certification by the Treasurer pursuant to the District Securities Investigation Law of 1965 (Chapter 2.5 (commencing with Section 58750) of Division 2 of Title 6 of the Government Code), and the Districts Securities Law (Chapter 1 (commencing with Section 20000) of Division 10 of the Water Code) prior to the adoption of this article shall continue to be subject to those investigations, reports, and approvals or certification.
Any action or proceedings wherein the validity of the levy or collection of the retail transactions and use tax, or any proceedings in relation thereto, is contested, questioned, or denied shall be commenced not later than July 1, 1990; otherwise the retail transactions and use tax and all proceedings in relation thereto shall be held to be valid and in every respect legal, enforceable, and incontestable.
Any action or proceedings wherein the validity of the issuance of any bonds, or any proceedings in relation thereto is contested, questioned, or denied shall be commenced not later than July 1, 1990, or, in the case of bonds authorized to be issued after that date, within six months from the date the bonds are authorized to be issued by the district; otherwise, in each case, the bonds and all proceedings in relation thereto shall be held to be valid and in every respect legal, enforceable, and incontestable.
Nothing in this section precludes the validity of the retail transactions and use tax or of any bonds or any related proceedings from being established by an action brought under Chapter 9 (commencing with Section 860) of Title 10 of Part 2 of the Code of Civil Procedure or pursuant to any other procedure established by law, before the end of any period of time specified in subdivision (a) or (b).
ARTICLE 11. Investments [103390. - 103393.]
Subject to any agreement or covenant between the district and the holders of any of its obligations limiting or restricting classes of investments, the district may invest any surplus money in its treasury, including money in any sinking fund, reserve fund, or other fund created or established for the benefit of holders of any outstanding obligations of the district, in any of the following:
Its own bonds.
Treasury notes, certificates of indebtedness, bills, bonds of the United States, or any other evidence of indebtedness secured by the full faith and credit of the United States.
Obligations issued pursuant to the Federal Home Loan Bank Act or the National Housing Act.
Treasury notes or bonds of this state, or of any public corporation, municipal corporation, public district, or political subdivision within this state which are legal as security for the deposit of public funds.
In any investment in which county funds may be placed pursuant to the general laws of the state.
Such investment may be made by direct purchase of any issue of such bonds, treasury notes, or obligations, or part thereof, at the original sale or by the subsequent purchase of the bonds, treasury notes, or obligations.
Any bonds, treasury notes, or obligations purchased and held as investments by the district may, from time to time, be sold and the proceeds reinvested in bonds, treasury notes, or obligations as provided in this article.
Sales of any bonds, treasury notes, or obligations purchased and held by the district shall, from time to time, be made in season so that the proceeds may be applied to the purposes for which the money with which the bonds, treasury notes, or obligations were originally purchased was placed in the treasury of the district.
ARTICLE 12. Construction Manager/General Contractor Project Delivery Contracts [103394. - 103399.1.]
For purposes of this article, the following terms shall have the following meanings:
“Construction Manager/General Contractor method” or “CMGC” means the Construction Manager/General Contractor method as defined in subdivision (b) of Section 6951 of the Public Contract Code.
“Construction manager” means a construction manager as defined in subdivision (c) of Section 6951 of the Public Contract Code.
Subject to the limitations of this article, the district may utilize the CMGC project delivery method for public transit projects within its jurisdiction.
The district may enter into a CMGC project delivery method contract pursuant to this article if, after evaluation of the traditional design-bid-build process of construction and of the CMGC project delivery method in a public meeting, the district makes a written finding that use of the CMGC project delivery method on the specific project under consideration will accomplish one or more of the following objectives: reduce project costs, expedite the project’s completion, or provide features not achievable through the design-bid-build method. This finding shall be made prior to the district entering into a CMGC project delivery method contract. In the CMGC project delivery method proposal, the written findings shall be included as part of an application for state funds for a transit project.
Any public works project that is contracted for pursuant to this article shall be subject to the requirements of Section 1771.4 of the Labor Code.
If a contract for CMGC services is entered into pursuant to this article and includes preconstruction services by the construction manager, the district shall enter into a written contract with the construction manager for preconstruction services, under which the district shall pay the construction manager a fee for preconstruction services in an amount agreed upon by the district and the construction manager. The preconstruction services contract may include fees for services to be performed during the contract period; provided, however, the district shall not request or obtain a fixed price or a guaranteed maximum price for the construction contract from the construction manager or enter into a construction contract with the construction manager until after the district has entered into a services contract. A preconstruction services contract shall provide for the subsequent negotiation for construction of all or any discrete phase or phases of the project and shall provide for the district to own the design plans and other preconstruction services work product.
A contract for construction services will be awarded after the plans have been sufficiently developed and either a fixed price or a guaranteed maximum price has been successfully negotiated. In the event that a fixed price or a guaranteed maximum price is not negotiated, the district may award the contract for construction services utilizing any other procurement method authorized by law.
The construction manager shall perform not less than 30 percent of the work covered by the fixed price or guaranteed maximum price agreement reached. Work that is not performed directly by the construction manager shall be bid to subcontractors pursuant to Section 6955 of the Public Contracts Code.
Nothing in this article affects, expands, alters, or limits any rights or remedies otherwise available at law.
Upon completion of a project using the CMGC project delivery method, the district shall prepare a progress report to the board of directors. The progress report shall include, but shall not be limited to, all of the following information:
A description of the project.
The entity that was awarded the project.
The estimated and actual costs of the project.
The estimated and actual schedule for project completion.
A description of any written protests concerning any aspect of the solicitation, bid, proposal, or award of the project, including, but not limited to, the resolution of the protests.
An assessment of the prequalification process and criteria utilized under this article.
A description of the method used to evaluate the bid or proposal, including the weighting of each factor and an assessment of the impact of this requirement on a project.
A description of any challenges or unexpected problems that arose during the construction of the project and a description of the solutions that were considered and ultimately implemented to address those challenges and problems.
Recommendations to improve the CMCG project delivery method authorized under this article.
The progress report shall be made available on the district’s Internet Web site.
The provisions of this article are severable. If any provision of this article or its application is held invalid, that invalidity shall not affect other provisions or applications that can be given effect without the invalid provision or application.
Contracts awarded pursuant to this article shall be valid until the project is completed.
ARTICLE 13. Job Order Contracting [103399.5. - 103399.11.]
Notwithstanding Article 19 (commencing with Section 20330) of Chapter 1 of Part 3 of Division 2 of the Public Contract Code, the district may use the procurement method outlined in this article for a job order contract.
The district shall not contract for work that is protected by applicable collective bargaining agreements. All job order contracts shall comply with all district collective bargaining agreements.
Job order contracts of the district shall be competitively bid and awarded to bidders providing qualified responsive bids.
Job order contracts shall be for repair, remodeling, or other repetitive work to be done according to unit prices. No annual contracts may be awarded for any new construction.
A job order contract shall be subject to a project labor agreement between the district and the San Mateo Building Trades Council, or an amendment or extension to that agreement.
Solicitations for job order contracts shall progress as follows:
The district shall prepare a set of solicitation documents for job order contracts. The documents shall include a unit price catalog or other established unit prices, job order contract terms, job order contract technical specifications, and any other information the district deems necessary to adequately describe the district’s needs.
An architect, engineer, consultant, or contractor retained by the district to assist in the development of the job order contract solicitation documents shall not be eligible to bid or to participate in the preparation of a job order contract bid.
The district may award multiple job order contracts in response to a single job order contract solicitation.
The district shall develop a system for evaluating job order contract bids for awarding job order contracts.
The award of a job order contract shall progress as follows:
The award of job order contracts, if any, shall be made to a job order contractor or to job order contractors that the district determines to be qualified and responsive based upon preestablished criteria to be determined by the district.
The job order contractors shall comply with the district’s project labor agreement, as applicable.
Notwithstanding paragraph (4), the district, by a process determined by the district, may award any job order for repair or renovation work with a value equal to or less than two hundred fifty thousand dollars ($250,000) to a job order contractor that is also a certified small business enterprise, as established by the district’s small business enterprise certification process or any similar certification process acceptable to the district, or to a job order contractor that is also a disabled veterans business enterprise, as certified by the Department of General Services.
The maximum total dollar amount that may be awarded under a single job order contract shall not exceed five million dollars ($5,000,000) in the initial contract term of the job order contract. No single job order may exceed one million dollars ($1,000,000).
Job order contracts may be executed for an initial contract term of no more than 12 months and may be extended or renewed for two subsequent annual terms and a maximum of ten million dollars ($10,000,000) over the subsequent two terms of the contract.
Work shall not be split or separated into smaller job orders for the purpose of evading the cost limits of the article.
Dollar amounts specified in this section may be adjusted annually to reflect the percentage change in the California Consumer Price Index.
All work bid under job order contracts shall comply with Chapter 4 (commencing with Section 4100) of Part 1 of Division 2 of the Public Contract Code and is subject to all of the penalties and provisions set forth in that chapter.
For purposes of this article, if a job order contractor chooses to use a subcontractor, the job order contractor shall verify that the subcontractor possesses and maintains the appropriate licenses and credentials required.
If the district, after conducting an administrative due process review, determines that there has been a violation of Chapter 4 (commencing with Section 4100) of Part 1 of Division 2 of the Public Contract Code, including, but not limited to, bid shopping by the job order contractor, the district may terminate the job order contract, declare the contractor ineligible for future job order contracts for a period of time to be determined by the district, or withdraw authorization for the contractor to proceed with awarded work.
A job order contract shall set forth in the general conditions of the job order contract the party or parties responsible for seeing that Article 2 (commencing with Section 1770) of Chapter 1 of Part 7 of Division 2 of the Labor Code is complied with.
For purposes of job order contracting, prevailing wages shall apply to all work ordered under the job order contract regardless of thresholds set forth in Section 1771.5 of the Labor Code.
The job order contractor shall pay the prevailing wage in effect at the time the job order contract is issued by the district and all increases as published by the Department of Industrial Relations for the term of the job order contract, including all overtime, holiday, and shift provisions published by the Department of Industrial Relations.
The district shall designate one individual to act as a monitor to inspect job sites for labor compliance violations at the request of the designated labor representative in its project labor agreement.
In order to prevent fraud, waste, and abuse, the district shall prepare for each individual job order developed under a job order contract an independent cost estimate. The estimate shall be prepared before the receipt of any job order contractor’s estimate for the work and shall be compared to the job order contractor’s estimate to determine the reasonableness of that estimate before issuance of any job order. If the district finds the job order contractor’s estimate to perform work for a given job order to be unreasonable, not cost effective, or undesirable, the district may elect not to issue the job order to the job order contractor, and may, instead, use any other available procurement procedures or choose not to move forward with the work.
The district shall submit to the appropriate policy and fiscal committees of the Legislature, on or before January 1, 2030, a report on the use of job order contracting under this article. The report shall include, but shall not be limited to, all of the following information:
A description of the district’s system for evaluating job order contract bids for award of job order contracts, including, but not limited to, the criteria used by the district to determine a qualified and responsive job order contractor.
A description of each job order contract awarded and the contractor awarded the contract.
An assessment of the use of job order contracting under this article.
A report to be submitted pursuant to subdivision (a) shall be submitted in compliance with Section 9795 of the Government Code.
This article shall remain in effect only until January 1, 2032, and as of that date is repealed.
CHAPTER 6. Personnel [103400. - 103451.]
ARTICLE 1. Employee Relations [103400. - 103407.]
Employees shall have the right to self-organization, to form, join, or assist labor organizations, to bargain collectively through representatives of their own choosing, and to engage in other concerted activities for the purpose of collective bargaining or other mutual aid or protection.
Any question which may arise with respect to whether a majority of employees in an appropriate unit desire to be represented by a labor organization shall be submitted to the Public Employment Relations Board. In resolving those questions of representation, including the determination of the appropriate unit or units, petitions, and the conduct of hearings and elections, the director shall apply the relevant federal law and administrative practice developed under the Labor Management Relations Act, 1947, as amended, and, for this purpose, shall adopt appropriate rules and regulations.
The California State Mediation and Conciliation Service shall administer any rules and regulations and shall provide for a prompt public hearing and secret ballot election to determine the question of representation and shall certify the results to the parties.
Any certification of a labor organization to represent or act for the employees in any collective bargaining unit shall not be subject to challenge on the grounds that a new substantial question of representation within the collective bargaining unit exists until the lapse of one year from the date of certification or the expiration of any collective bargaining agreement, whichever is later, except that no collective bargaining agreement shall be considered to be a bar to representation proceedings for a period of more than two years.
Whenever a majority of the employees employed by the district in a unit appropriate for collective bargaining indicate a desire to be represented by a labor organization and upon determining, as provided in Section 103401, that the labor organization represents at least a majority of the employees in the appropriate unit, the board and the accredited representative of employees shall bargain in good faith and make all reasonable efforts to reach agreement on the terms of a written contract governing wages, hours, pensions, and working conditions.
A contract or agreement shall not be made with any labor organization, association, or group that denies membership on any basis listed in subdivision (a) of Section 12940 of the Government Code, as those bases are defined in Sections 12926 and 12926.1 of the Government Code. However, the organization may preclude from membership any individual who advocates the overthrow of the government by force or violence.
The district shall not discriminate with regard to employment against any person on any basis listed in subdivision (a) of Section 12940 of the Government Code, as those bases are defined in Sections 12926 and 12926.1 of the Government Code, except as otherwise provided in Section 12940 of the Government Code.
If, after a reasonable period of time, representatives of the district and the accredited representatives of the employees fail to reach agreement on the terms of a written contract governing wages, hours, pensions, and working conditions or the interpretation or application of the terms of an existing contract, either party may request mediation services of the State Conciliation Service.
If, after a reasonable period of time, representatives of the district and the accredited representatives of the employees fail to reach agreement either on the terms of a written contract governing wages, hours, pensions, and working conditions or the interpretation or application of the terms of an existing contract, upon the agreement of both the district and the representatives of the employees, the dispute may be submitted to an arbitration board.
The arbitration board shall be composed of two representatives of the district and two representatives of the labor organization, and they shall endeavor to agree upon the selection of a fifth member. If they are unable to agree, the names of five persons experienced in labor arbitration shall be obtained from the State Conciliation Service. The labor organization and the district shall, alternately, strike a name from the list so supplied, and the name remaining after the labor organization and the district have stricken four names, shall be designated as the fifth arbitrator and chairman of the board of arbitration. The labor organization and the district shall determine by lot who shall first strike a name from the list. The decision of a majority of the arbitration board shall be final and binding upon the parties thereto.
Each party shall be responsible for the expense of the presentation of its case. All other expenses of arbitration shall be borne equally by the parties and the expenses may include the making of a verbatim record of the proceedings and transcript of that record.
In the event the district and the representatives of the employees do not agree to submit any dispute to arbitration as provided in Section 103405, the State Conciliation Service may be notified by either party that a dispute exists and there is no agreement to arbitrate.
Following such notification, the State Conciliation Service shall determine whether or not the dispute may be resolved by the parties and, if not, the issues concerning which the dispute exists. Upon such determination, the service shall certify its findings to the Governor of the State of California. The Governor shall, within 10 days of receipt of certification, appoint a factfinding commission consisting of three persons.
The commission shall immediately convene and inquire into and investigate the issues in the dispute. The commission shall have authority to issue subpoenas for the attendance of witnesses and subpoenas duces tecum for the production of books, documents, and other records. Subpoenas shall be served and enforced in accordance with Chapter 2 (commencing with Section 1985), Title 3, Part 4 of the Code of Civil Procedure. The commission shall report to the Governor within 30 days of the date of its creation.
After the creation of such a commission, and for 30 days after such commission has made its report to the Governor, no change, except by mutual agreement, shall be made by the parties to the controversy in the conditions out of which the dispute arose, and service to the public shall be provided.
In the event an exclusive collective bargaining representative is selected pursuant to Section 103401, the provisions of Chapter 10 (commencing with Section 3500), Division 4, Title 1 of the Government Code are not applicable to the district.
ARTICLE 2. Rights of Employees of Existing Facilities [103420. - 103421.]
Whenever the district acquires existing facilities from a publicly or privately owned utility, either in proceedings by eminent domain or otherwise, to the extent necessary for operation of facilities, all of the employees of such utility whose duties pertain to the facilities acquired who have been employed by such utility for at least 75 days shall be appointed to comparable positions in the district without examination. These employees shall be given sick leave, seniority, and vacation credits in accordance with the records of the acquired public utility. No employee of any acquired public utility shall suffer any worsening of wages, seniority, pension, vacation, or other benefits by reason of the acquisition.
The provisions of this section shall apply only to those officers or supervisory employees of the acquired utility as shall be designated by the board.
Whenever the district acquires existing facilities from a publicly or privately owned utility, either in proceedings in eminent domain or otherwise, that has a pension plan in operation, members and beneficiaries of such pension plan shall continue to have the rights, privileges, benefits, obligations and status with respect to such established system. The outstanding obligations and liabilities of such public utility by reason of such pension plan shall be considered and taken into account and allowance made therefor in the purchase price of such public utility. The persons entitled to pension benefits as provided for in this section and the benefits which are provided shall be specified in the agreement or order by which any public utility is acquired by the district.
ARTICLE 3. Pension Plan [103440. - 103442.]
The adoption, terms, and conditions of a pension plan covering employees of the district in a bargaining unit represented by a labor organization shall be pursuant to a collective bargaining agreement between such organization and the district.
The board may contract with the Board of Administration of the Public Employees’ Retirement System and enter all, or any portion, of its employees under such system; provided, that no employees of the district in a bargaining unit which is represented by a labor organization shall be included in such contract except as authorized by a collective bargaining agreement.
All persons receiving pension benefits from an acquired public utility, and all persons entitled to pension benefits under any pension plan of such acquired public utility, may become members or receive pensions under a pension plan established by the district by mutual agreement of such persons and the district. Such agreement may provide for the waiver of all rights, privileges, benefits, and status with respect to the pension plan of such acquired public utility.
ARTICLE 4. Other Benefits [103450. - 103451.]
The district shall take such steps as may be necessary to obtain coverage for the district and its employees under Subchapter II of the Federal Social Security Act, as amended, and the related provisions of the Federal Contributions Act, as amended.
The district shall take such steps as may be necessary to obtain coverage for the district and its employees under the workmen’s compensation, unemployment compensation, and disability and unemployment insurance laws of the State of California.
CHAPTER 7. Bonds and Other Evidences of Indebtedness [103500. - 103602.]
ARTICLE 1. Authorization and Issuance of General Obligation Bonds [103500. - 103513.]
Whenever the board deems it necessary for the district to incur a bonded indebtedness for the acquisition, construction, or repair of any or all improvements, works, property or facilities, authorized by this part or necessary or convenient for the carrying out of the powers of the district, or for any other purpose authorized by this part, it shall, by ordinance, adopted by a vote of two-thirds of all members of the board, so declare and call an election to be held in the district for the purpose of submitting to the qualified voters thereof the proposition of incurring indebtedness by the issuance of bonds of the district; provided the total amount of bonds issued and outstanding pursuant to this article shall not exceed 15 percent of the assessed value of the taxable property of the district as shown by the last equalized assessment roll of the county. The ordinance shall state:
The purposes for which the proposed debt is to be incurred, which may include all costs and estimated costs incidental to or connected with the accomplishment of such purposes, including, without limitation, engineering, inspection, legal, fiscal agents, financial consultant and other fees, bond and other reserve funds, working capital, bond interest estimated to accrue during the construction period and for a period not to exceed three years thereafter, and expenses of all proceedings for the authorization, issuance, and sale of the bonds.
The estimated cost of accomplishing such purposes.
The amount of the principal of the indebtedness.
The maximum term the bonds proposed to be issued shall run before maturity, which shall not exceed 50 years from the date thereof or the date of each series thereof.
The maximum rate of interest to be paid, which shall not exceed 7 percent per annum.
The proposition to be submitted to the voters, which may include one or more purposes.
The date of the election.
The manner of holding the election and the procedure for voting for or against the measure.
The ordinance may also contain, a statement that the transaction and use tax imposed pursuant to Article 10 (commencing with Section 103350) of Chapter 5, or a stated portion thereof, shall be levied, or continued to be levied, and used to the extent required to pay the principal of, and interest on, the bonds as they become due, to provide for any sinking fund payments required therefor, or to create or maintain any reserve fund required therefor.
The ordinance may also contain any other matters authorized by this part or any other law.
Notice of the holding of such election shall be given by publishing, pursuant to Section 6066 of the Government Code, the ordinance calling for election in at least one newspaper published in such district. No other notice of such election need be given. Except as otherwise provided in the ordinance, the election shall be conducted as other district elections.
If any proposition is defeated by the electors, the board shall not call another election on a substantially similar proposition to be held within six months after the prior election. If a petition requesting submission of such a proposition, signed by 15 percent of the district electors, as shown by the votes cast for all candidates for Governor within the district at the last gubernatorial election, is filed with the board, it may call an election before the expiration of six months.
If 60 percent of the electors voting on the proposition vote for it, then the board may, by resolution, at such time or times as it deems proper, issue bonds of the district for the whole or any part of the amount of the indebtedness so authorized and may from time to time, by resolution, provide for the issuance of such amounts as the necessity thereof may appear, until the full amount of such bonds authorized shall have been issued. The full amount of bonds may be divided into two or more series and different dates of payment fixed for the bonds of each series. A bond need not mature on an anniversary of its date. The maximum term the bonds of any series shall run before maturity shall not exceed 50 years from the date of each series respectively. In such resolution or resolutions, the board shall prescribe the form of the bonds (including, without limitation, registered bonds and coupon bonds) and the form of any coupons to be attached thereto, the registration, conversion, and exchange privileges, if any, pertaining thereto, and fix the time when the whole or any part of the principal shall become due and payable.
The bonds shall bear interest at a rate or rates not exceeding 7 percent per annum, payable semiannually, except that the first interest payable on the bonds, or any series thereof, may be for any period not exceeding one year as determined by the board. In the resolution or resolutions providing for the issuance of such bonds, the board may also provide for call and redemption of such bonds prior to maturity at such times and prices and upon such other terms as it may specify, provided that no bond shall be subject to call or redemption prior to maturity unless it contains a recital to that effect or unless a statement to that effect is printed thereon. The denomination or denominations of the bonds shall be stated in the resolution providing for their issuance, but shall not be less than five thousand dollars ($5,000). The principal of, and interest on, such bonds shall be payable in lawful money of the United States at the office of the treasurer of the district. The bonds, or such series thereof, shall be dated and numbered consecutively and shall be signed by the chairman of the board and the treasurer. All such signatures, countersignatures, and seal may be printed, lithographed, or mechanically reproduced, except that one of such signatures or countersignatures on the bonds shall be manually affixed. If any officer whose signature or countersignature appears on bonds or coupons ceases to be such officer before the delivery of the bonds, his signature is as effective as if he had remained in office.
The bonds may be sold as the board determines by resolution, but for not less than par. Before selling the bonds, or any part thereof, the board shall give notice inviting sealed bids in such manner as it may prescribe. If satisfactory bids are received, the bonds offered for sale shall be awarded to the highest responsible bidder. If no bids are received, or if the board determines that the bids received are not satisfactory as to price or responsibility of the bidders, the board may reject all bids received, if any, and either readvertise or sell the bonds at private sale.
The delivery of any bonds shall be at the office of the district treasurer, and the purchase price may be received in cash or cashier check.
All accrued interest and premiums received on the sale of bonds shall be placed in the fund to be used for the payment of principal of, and interest on, the bonds and the remainder of the proceeds of the bonds shall be placed in the treasury to the credit of the proper improvement fund and applied exclusively to the purposes for which the debt was incurred (which purposes shall be in conformity with an approved general transit plan or element thereof then in effect); provided, however, that when such purposes have been accomplished, any moneys remaining in such improvement fund (a) shall be transferred to the fund to be used for the payment of principal of, and interest on, the bonds, or (b) shall be placed in a fund to be used for the purchase of outstanding bonds of the district from time to time in the open market at such prices and in such manner, either at public or private sale or otherwise, as the board may determine. Bonds so purchased shall be canceled immediately.
After the expiration of three years after a bond election, the board may determine, by ordinance adopted by a vote of two-thirds of all the members of the board, that any or all of the bonds authorized at the election remaining unsold shall not be issued or sold. When the ordinance takes effect, the authorization to issue those bonds shall become void.
Whenever the board deems that the expenditure of money for the purposes for which the bonds were authorized by the voters is impractical or unwise, it may, by ordinance adopted by a vote of two-thirds of all members of the board, so declare and call an election to be held in the district for the purpose of submitting to the qualified voters thereof the proposition of incurring indebtedness by the issuance of such bonds for some other purposes or, in the case where bonds have been sold, the proposition to use the proceeds for some other purposes. The procedure, so far as applicable, shall be the same as when a bond proposition is originally submitted.
The board may provide for the issuance, sale, or exchange of refunding bonds to redeem or retire any bonds issued by the district upon the terms, at the times and in the manner which it determines. Refunding bonds may be issued in a principal amount sufficient to pay all, or any part of, the principal of such outstanding bonds, the interest thereon and the premiums, if any, due upon call and redemption thereof prior to maturity, and all expenses of such refunding. The provisions of this article for the issuance and sale of bonds apply to the issuance and sale of such refunding bonds; except that (a) no election need be called or held for the purpose of authorizing the issuance of refunding bonds, and (b) when refunding bonds are to be exchanged for outstanding bonds the method of exchange shall be as determined by the board.
The provisions of Article 4 (commencing with Section 53500), Chapter 3, Part 1, Division 2, Title 5 of the Government Code are applicable to the district.
Any bonds which shall be issued under the provisions of this article shall be legal investment for all trust funds; for the funds of insurance companies, banks—both commercial and savings—and trust companies; and for state school funds; and whenever any money or funds may, by any law now or hereafter enacted, be invested in bonds of cities, cities and counties, counties, school districts, or other districts within the State of California, such money or funds may be invested in the bonds issued under this part, and whenever bonds of cities, cities and counties, counties, school districts, or other districts within this state may, by any law now or hereafter enacted, be used as security for the performance of any act or the deposit of any public moneys, the bonds issued under this part may be so used. The provisions of this article shall be in addition to all other laws relating to legal investments and shall be controlling as the latest expression of the Legislature with respect thereto.
If bonds are authorized that contain a provision for special taxes under subdivision (i) of Section 103500, the board may enter into such covenants as may be deemed proper to provide for issuance of additional parity bonds, the priority and pledge of special taxes and such other covenants as are customary or desirable in the issuance of any bonds payable out of special funds or necessary, convenient, or desirable to secure the bonds or tending to make them more marketable, subject to the provisions of the ordinance calling the bond election.
ARTICLE 2. Revenue Bonds [103530. - 103531.]
The district may issue bonds, payable from revenue of any facility or enterprise to be acquired or constructed by the district, in the manner provided by the Revenue Bond Law of 1941 (Chapter 6 (commencing with Section 54300), Part 1, Division 2, Title 5 of the Government Code) all of the provisions of which are applicable to the district.
The district is a local agency within the meaning of the Revenue Bond Law of 1941 (Chapter 6 (commencing with Section 54300), Part 1, Division 2, Title 5 of the Government Code). The term “enterprise” as used in the Revenue Bond Law of 1941 shall, for all purposes of this part, include the system or any or all transit facilities and all additions, extensions, and improvements thereto authorized to be acquired, constructed, or completed by the district. The district may issue revenue bonds under the Revenue Bond Law of 1941 for any one or more transit facilities authorized to be acquired, constructed, or completed by the district or, in the alternative, may issue revenue bonds under the Revenue Bond Law of 1941 for the acquisition, construction, and completion of any one of such transit facilities. Nothing in this article shall prevent the district from availing itself of, or making use of, any procedure provided in this part for the issuance of bonds of any type or character for any of the transit facilities authorized hereunder, and all proceedings may be carried on simultaneously or, in the alternative, as the board may determine.
ARTICLE 3. Equipment Trust Certificates [103550. - 103554.]
The district shall have power to purchase transit equipment such as cars, trolley buses and motorbuses, or rolling equipment, and may execute agreements, leases, and equipment trust certificates in the forms customarily used by private corporations engaged in the transit business appropriate to effect such purchase and leasing of transit equipment, and may dispose of such equipment trust certificates upon such terms and conditions as the board may deem appropriate. Payment for such equipment, or rentals therefor, may be made in installments, and the deferred installments may be evidenced by equipment trust certificates payable from any source or sources of funds specified in such certificates that are or will be legally available to the district; and title to such equipment shall not rest in the district until the equipment trust certificates are paid.
The agreement to purchase or lease may direct the vendor or lessor to sell and assign or lease the rolling equipment to a bank or trust company duly authorized to transact business in the State of California as trustee, for the benefit and security of the equipment trust certificates and may direct such trustee to deliver the rolling equipment to one or more designated officers of the district and may authorize the district to simultaneously therewith execute and deliver an installment purchase agreement or a lease of the equipment to the district.
The agreements and leases shall be duly acknowledged before a person authorized by law to take acknowledgments of deeds and in the form required for acknowledgment of deeds, and such agreements, leases, and equipment trust certificates shall be authorized by resolution of the district and shall contain such covenants, conditions, and provisions which may be deemed necessary or appropriate to insure the payment of the equipment trust certificates from legally available source or sources of funds specified in such certificates.
The covenants, conditions, and provisions of the agreements, leases, and equipment trust certificates shall not conflict with any of the provisions of any trust agreement securing the payment of bonds, notes, or certificates of the district.
An executed copy of each such agreement and lease shall be filed in the office of the Secretary of State, who shall be entitled to receive one dollar ($1) for each such copy filed with him and which filing shall constitute notice to any subsequent judgment creditor or any subsequent purchaser. Each vehicle so purchased or leased shall have the name of the owner or lessor plainly marked on both sides thereof followed by the appropriate words “Owner and Lessor” or “Owner and Vendor,” as the case may be.
ARTICLE 4. Improvement Acts and Special Benefit Districts [103570. - 103571.]
The Improvement Act of 1911, the Municipal Improvement Act of 1913, and the Improvement Bond Act of 1915 are applicable to the district.
The provisions of Chapter 1 (commencing with Section 99000) of Part 11 of this division are applicable to the district.
ARTICLE 5. Temporary Borrowing [103580. - 103583.]
The district may borrow money for the purpose of defraying general administrative and preliminary expenses of the district, lawfully incurred, prior to the time moneys to be raised by the first tax levy for the district are available, a sum which shall not exceed five cents ($0.05) on each one hundred dollars ($100) of assessed valuation of taxable property in the district at the time the moneys are borrowed, and to evidence such borrowing by notes bearing interest at a rate not to exceed 7 percent per annum. The notes shall be payable from the first tax levy made by the district, and the tax levy shall contain a sum sufficient to provide for the payment of the notes and the interest thereon. The form of the notes, and their issuance and sale, shall be governed by the applicable provisions referred to in Section 103583.
At any time prior to the first receipt by the district of revenues from taxation, the county may lend any available money to the district for the purposes of organization and operation. Such expenditures shall constitute a proper expenditure of county funds. Such loans may bear interest.
The district may borrow money in accordance with the provisions of Article 7 (commencing with Section 53820), or of Article 7.6 (commencing with Section 53850), of Chapter 4, Part 1, Division 2, Title 5 of the Government Code.
The district may borrow money in anticipation of the sale of bonds which have been authorized to be issued, but which have not been sold and delivered, and may issue negotiable bond anticipation notes therefor and may renew the same from time to time, but the maximum maturity of any such notes, including the renewals thereof, shall not exceed five years from the date of delivery of such original notes. Such notes may be paid from any moneys of the district available therefor and not otherwise pledged. If not previously otherwise paid, the notes shall be paid from the proceeds of the next sale of the bonds of the district in anticipation of which they were issued and, if not so paid, taxes may be levied for their payment in the same manner as taxes are levied for the payment of general obligation bonds pursuant to Article 9 (commencing with Section 103340) of Chapter 5 until such bonds are issued. Such notes shall not be issued in any amount in excess of the aggregate amount of bonds which the district has been authorized to issue, less the amount of any bonds of such authorized issue previously sold, and also less the amount of other bond anticipation notes therefor issued and then outstanding. The notes shall be issued and sold in the same manner as the bonds. Such notes and the resolution or resolutions authorizing the same may contain any provisions, conditions, or limitations which a resolution of the district authorizing the issuance of bonds may contain.
ARTICLE 6. Miscellaneous [103600. - 103602.]
The district may bring an action to determine the validity of any of its bonds, equipment trust certificates, warrants, notes, or other evidences of indebtedness pursuant to Chapter 9 (commencing with Section 860), Title 10, Part 2 of the Code of Civil Procedure.
All bonds and other evidences of indebtedness issued by the district under the provisions of this part, and the interest thereon, are free and exempt from all taxation within the State of California, except for transfer, franchise, inheritance, and estate tax.
Notwithstanding any other provisions of this part or any other law, the provisions of all ordinances, resolutions, and other proceedings in the issuance by the district of any bonds, bonds with a pledge of revenues, bonds for improvement districts, revenue bonds, equipment trust certificates, notes, or any and all evidences of indebtedness or liability shall constitute a contract between the district and the holders of such bonds, equipment trust certificates, notes, or evidences of indebtedness or liability, and the provisions thereof shall be enforceable against the district, or any or all of its successors or assigns, by mandamus or any other appropriate suit, action or proceeding in law or in equity in any court of competent jurisdiction. Nothing contained in this part or in any other law shall be held to relieve the district or the territory included within it from any bonded or other debt or liability contracted by the district. Upon dissolution of the district or upon withdrawal of territory therefrom, the property formerly included within the district, or withdrawn therefrom, shall continue to be liable for the payment of all bonded and other indebtedness or liabilities outstanding at the time of such dissolution or withdrawal the same as if the district had not been so dissolved or the territory withdrawn therefrom, and it shall be the duty of the successors or assigns to provide for the payment of such bonded and other indebtedness and liabilities. Except as may be otherwise provided in the proceedings for the authorization, issuance, and sale of any revenue bonds, bonds secured by a pledge of revenues, or bonds for improvement districts secured by a pledge of revenues, revenues of any kind or nature derived from any revenue-producing improvements, works, facilities, or property owned, operated, or controlled by the district shall be pledged, charged, assigned and have a lien thereon for the payment of such bonds as long as the same are outstanding, regardless of any change in ownership, operation, or control of such revenue-producing improvements, works, facilities, or property and it shall, in such later event or events, be the duty of the successors or assigns to continue to maintain and operate such revenue-producing improvements, works, facilities, or property as long as bonds are outstanding.
CHAPTER 8. Dissolution [103700. - 103700.]
The district may be dissolved pursuant to the provisions of the District Reorganization Act of 1965 (Division 1 (commencing with Section 56000), Title 6 of the Government Code).
PART 16. SONOMA-MARIN AREA RAIL TRANSIT DISTRICT [105000. - 105337.]
CHAPTER 1. General Provisions and Definitions [105000. - 105004.]
This part shall be known and may be cited as the Sonoma-Marin Area Rail Transit District Act.
It is the intent of the Legislature in enacting this part to provide for a unified, comprehensive institutional structure for the ownership and governance of a passenger and freight rail system within the Counties of Marin, Napa, Solano, and Sonoma, and any other counties immediately adjacent to those counties.
Unless the context otherwise requires, the provisions of this chapter govern the construction of this part.
As used in this part, the following terms have the following meanings:
“District” means the Sonoma-Marin Area Rail Transit District.
“Dividing line” has the same meaning as defined in Section 93004 of the Government Code.
“Rail transit” means the transportation of passengers and their incidental baggage by rail and provision of freight service by rail.
“Rail transit works” or “rail transit facilities” means any or all real and personal property, equipment, rights, or interests owned or to be acquired by the district for rail transit service purposes, including ancillary bicycle and pedestrian pathways that provide connections between and access to station sites.
“Board of directors,” “board,” or “directors” means the board of directors of the district.
“Public agency” includes the state, and any county, city and county, city, district, or other political subdivision or public entity of, or organized under the laws of, this state, or any department, instrumentality, or agency thereof.
The Cortese-Knox-Hertzberg Local Government Reorganization Act of 2000 (Part 1 (commencing with Section 56000) Division 3 of Title 5 of the Government Code), shall not apply to the formation or dissolution of the district, or the annexation of additional contiguous territory to the district.
CHAPTER 2. Formation of District [105010. - 105012.]
There is hereby created the Sonoma-Marin Area Rail Transit District, comprising the territory lying within the boundaries of the Counties of Marin and Sonoma.
Through compliance with the provisions for annexation set forth in Chapter 7 (commencing with Section 105280), the territory of all or part of any other contiguous county may be included within the district.
Upon the dissolution of the Sonoma-Marin Area Rail Transit Commission and the Northwestern Pacific Railroad Authority, the district shall succeed to any or all of the powers, duties, rights, obligations, liabilities, indebtedness, bonded and otherwise, immunities, and exemptions of the commission and its board of commissioners and the authority and its board of directors.
Upon the dissolution of the Sonoma-Marin Area Rail Transit Commission and the Northwestern Pacific Railroad Authority, the district shall assume the rights and obligations of the commission and the authority under any contract to which the commission or the authority is a party and which is to be performed, in whole or in part, on or after the date of dissolution of the Sonoma-Marin Area Rail Transit Commission and the Northwestern Pacific Railroad Authority.
All real and personal property owned by the Sonoma-Marin Area Rail Transit Commission and the Northwestern Pacific Railroad Authority may be transferred to the district. Any real or personal property owned individually or jointly by the Golden Gate Bridge, Highway and Transportation District, the County of Marin, or the Marin County Transit District, or any other public agency, may be transferred to the district.
Upon the dissolution of the Sonoma-Marin Area Rail Transit Commission, the district shall assume, without any condition whatsoever, all responsibilities and obligations previously assumed by the commission with respect to its fund transfer agreement with the Department of Transportation for the funding of the Sonoma-Marin Area Rail Transit Project.
On and after the date of dissolution of the Sonoma-Marin Area Rail Transit Commission and the Northwestern Pacific Railroad Authority, any reference in any provision of law or regulation to the commission or the authority shall be deemed to refer to the district.
CHAPTER 3. Government of District [105020. - 105052.]
ARTICLE 1. Board of Directors [105020. - 105023.]
The government of the district shall be vested in a board of directors, which shall consist of 12 members, appointed as follows:
Two members of the Sonoma County Board of Supervisors, each of whom shall also serve on the Board of Directors of the Sonoma County Transportation Authority, appointed by the Sonoma County Board of Supervisors.
Two members of the Marin County Board of Supervisors, appointed by the Marin County Board of Supervisors.
Three members, each of whom shall be a mayor or council member of a city or town within the County of Sonoma, appointed by the Mayors’ and Councilmembers’ Association of Sonoma County or its successor, if the following conditions are met:
At least two members are also city representatives for the Sonoma County Transportation Authority.
All of the members are from cities on the rail line in Sonoma County.
No city has more than one member.
The member of the City Council of the City of Novato who also serves on the Marin County Congestion Management Agency, appointed by the Marin County Congestion Management Agency or its successor.
The member of the City Council of the City of San Rafael who also serves on the Marin County Congestion Management Agency, appointed by the Marin County Congestion Management Agency or its successor.
One member, who shall be a mayor or council member of a city or town within the County of Marin and a member of the Marin County Congestion Management Agency, appointed by the Marin County Council of Mayors and Councilmembers or its successor.
Two members of the Golden Gate Bridge, Highway and Transportation District, neither of whom shall be a member of the Marin or Sonoma County Boards of Supervisors, appointed by the Golden Gate Bridge, Highway and Transportation District or its successor.
The 12 members of the board shall serve staggered, four-year terms.
Within 60 days of its occurrence, any vacancy on the board shall be filled by the body that originally made the appointment to the office in which the vacancy exists.
The board may fix the amount of compensation to be paid to each member of the board. The compensation shall not exceed five hundred dollars ($500) in any one calendar month. Each member shall be allowed necessary traveling and personal expenses incurred in the performance of his or her duties as may be authorized by the board.
In the event that new territory is annexed to the district pursuant to Chapter 7 (commencing with Section 105280), and upon the affirmative vote of a majority of directors, which shall include an affirmative vote of at least three directors from each county within the district appointed pursuant to subdivisions (a) to (f), inclusive, of Section 105020, the board may restructure the membership of the board to provide representation of the new territory on the board.
ARTICLE 2. Powers and Duties of Board of Directors [105030. - 105033.]
The board is the legislative body of the district and, consistent with the provisions of this part, shall determine all district policy.
The board shall select one of its members as chairperson, and another of its members as vice chairperson, who shall serve in the absence of the chairperson.
It shall be the duty of the board and it shall have the power to:
Own, operate, manage, and maintain a passenger and freight rail system within the territory of the district.
Determine the rail transit and freight facilities, including ancillary bicycle and pedestrian pathways, to be acquired and constructed by the district, the manner of operation, and the means to finance them.
Adopt an annual budget for the district that provides for the compensation of its officers and employees.
Fix rates, rentals, charges, and classifications of rail transit and freight service operated by the district.
Adopt an administrative code that prescribes the powers and duties of district officers, the method of appointment of district employees, and the methods, procedures, and systems for the operation and management of the district.
Adopt rules and regulations governing the use of rail transit and freight facilities owned or operated by the district.
Cause a postaudit of the financial transactions and records of the district to be made at least annually by a certified public accountant.
Adopt rules and regulations providing for the administration of employer-employee relations.
Consider potential alternatives to help address the housing needs of current and future employees.
Do any and all things necessary to carry out the purposes of this part.
The board is authorized to establish the position of chief of police. The chief of police shall be a duly sworn peace officer who shall be appointed by the board and who shall meet the current requirements of the Commission on Peace Officer Standards and Training pursuant to Title 4 (commencing with Section 13500) of Part 4 of the Penal Code.
If the board determines that more than one peace officer is needed, the board shall contract with law enforcement agencies located within the County of Marin or the County of Sonoma for the additional law enforcement services of one or more duly sworn peace officers who shall meet the current requirements of the Commission on Peace Officer Standards and Training pursuant to Title 4 (commencing with Section 13500) of Part 4 of the Penal Code.
ARTICLE 3. Meetings and Legislation [105040. - 105045.]
All meetings of the board shall be conducted in the manner prescribed by the Ralph M. Brown Act (Chapter 9 (commencing with Section 54950) of Part 1 of Division 2 of Title 5 of the Government Code).
A majority of the board constitutes a quorum for the transaction of its business.
The affirmative vote of a majority of the members of the board shall be necessary and, except as otherwise provided in this act, shall be sufficient to carry out any order, resolution, or ordinance coming before the board.
The board shall establish rules for its proceedings and determine the place and time for its meetings.
The acts of the board shall be expressed by motion, resolution, or ordinance.
If the district or a qualified voter initiative proposes a measure pursuant to Section 105115, the board of supervisors of the Counties of Sonoma and Marin shall call a special election on the measure in their respective counties. The special election may be consolidated with a statewide election and the measure shall be submitted to the voters of the Counties of Sonoma and Marin.
The district shall reimburse the Counties of Sonoma and Marin upon request for the incremental cost of submitting a measure to the voters pursuant to subdivision (a). These costs shall be reimbursed from revenues derived from the measure if it is approved by the voters, or, if the measure is not approved, from any existing revenues administered by the district.
ARTICLE 4. Other Officers [105050. - 105052.]
The board shall appoint a general manager for the district. The board may appoint a secretary, a chief engineer, a legal counsel, a controller, an auditor, a treasurer, and other officers, assistants, and deputies, as the board may deem necessary and provide for by ordinance. These officers shall serve at the pleasure of the board. The offices of auditor, controller, and treasurer may be held by separate officers or combined and held by one officer.
The Counties of Marin and Sonoma, the Golden Gate Bridge, Highway and Transportation District, or any other public agency may render assistance to the district as it may require, including the performance by officers of the counties, the Golden Gate Bridge, Highway and Transportation District, or other public agency of the functions of legal counsel, controller, auditor, and treasurer. The district shall reimburse the counties, the Golden Gate Bridge, Highway and Transportation District, or other public agency for the services performed by them for the district.
The powers and duties of the general manager are:
To head the administrative branch of the district and to be responsible to the board for the proper administration of all affairs of the district.
To appoint, supervise, suspend, or remove district officers, other than members of the board and officers appointed by the board.
To supervise and direct the preparation of the annual budget for the board and to be responsible for its administration after its adoption.
To formulate and present to the board plans for rail transit facilities within the district and the means to finance them.
To supervise the planning, acquisition, construction, maintenance, and operation of the rail transit facilities of the district.
To attend meetings of the board.
To prepare and submit to the board, as soon as practicable after the end of each fiscal year, a complete report of the finances and administrative activities of the district for the preceding year.
To perform other and additional duties as the board may require.
CHAPTER 4. Powers and Functions of the District [105060. - 105126.]
ARTICLE 1. Corporate Powers [105060. - 105062.]
The district has perpetual succession and may adopt a seal and alter it at its pleasure.
The district may sue and be sued, except as otherwise provided by law, in all actions and proceedings, in all courts and tribunals of competent jurisdiction.
All claims for money or damages against the district are governed by Division 3.6 (commencing with Section 810) of Title 1 of the Government Code, except as provided herein, or by other statutes or regulations expressly applicable thereto.
ARTICLE 2. Contracts [105070. - 105076.]
The district may make contracts and enter into stipulations of any nature whatsoever, employ labor, and do all acts necessary and convenient for the full exercise of the powers granted in this part.
No officer or employee of the district shall in any manner be interested, directly or indirectly, in any contract awarded or to be awarded by the board, or in the profits to be derived therefrom, contrary to the provisions of Article 4 (commencing with Section 1090) of Chapter 1 of Division 4 of Title 1 of the Government Code.
The district may insure against any accident or destruction of the rail transit system or any part thereof. The district may insure against loss of revenues from any cause whatsoever. In proceedings authorizing the issuance of any bonds, the district may provide for the carrying of insurance in an amount and of a character as may be specified, and may provide for the payment of premiums thereon. The district may also provide insurance as provided in Part 6 (commencing with Section 989) of Division 3.6 of Title 1 of the Government Code.
The district may contract for the services of independent contractors.
For purposes of entering into design-build contracts, the district is a “transit operator” within the meaning of Article 6.8 (commencing with Section 20209.5) of Chapter 1 of Part 3 of Division 2 of the Public Contract Code.
The district is a local agency for purposes of the Natural Disaster Assistance Act, Chapter 7.5 (commencing with Section 8680) of Division 1 of Title 2 of the Government Code.
The district shall be considered the succeeding agency to the “Sonoma-Marin Area Rail Transit Authority” for the purpose of receiving funds available under paragraph (30) of subdivision (a) of Section 14556.40 of the Government Code.
ARTICLE 3. Property [105085. - 105088.]
The district may take by grant, purchase, devise, or lease, or condemn in proceedings under eminent domain, or otherwise acquire, and hold and enjoy, real property of every kind within or without the district necessary to the full or convenient exercise of its powers. The board may lease, mortgage, sell, or otherwise dispose of any real or personal property when in its judgment it is in the best interests of the district to do so.
The district may exercise the right of eminent domain to take any property necessary or convenient to the exercise of the powers granted in this act. The district, in exercising that right, shall, in addition to the damage for the taking, injury, or destruction of property, also pay the cost, exclusive of betterment and with credit for salvage value, of removal, reconstruction, or relocation of any substitute facilities, including structures, railways, mains, pipes, conduits, wires, cables or poles of any public utility which is required to be moved to a new location.
The district may take by gift, or take or convey by grant, purchase, devise, or lease, and hold and enjoy, real and personal property of every kind within or without the district necessary for, incidental to, or convenient for, transit-oriented joint development projects that meet the definition and requirement set forth in subdivision (b).
For purposes of this section, a “transit-oriented joint development project” is a commercial, residential, or mixed-use development that is undertaken in connection with existing, planned, or proposed intermodal transit facilities and is located one-fourth mile or less from the external boundaries of that facility.
Any transit-oriented joint development project created under this section shall comply with the land use and zoning regulations of the city, county, or city and county in which the project is located.
The authority granted under this section extends to any joint powers agency of which the district is a member and for which the district serves as the managing agency.
The district may not exercise its power of eminent domain in order to make an acquisition under this section.
Upon receiving the Great Redwood Trail Agency’s rights, privileges, and interests relating to the agency’s rail right-of-way south of the dividing line pursuant to Section 93030 of the Government Code, the district shall designate a single point of contact for the agency.
The district may partner or contract with trail agencies, including the Great Redwood Trail Agency, on creation and maintenance of the bicycle and pedestrian pathways under the district’s jurisdiction.
The ancillary bicycle and pedestrian pathways that provide connections between and access to district station sites and the district’s other pathways shall be known as “The Great Redwood Trail, Southern Segment.”
The planned bike and pedestrian pathway running from the district’s station in the City of Larkspur to the northern terminus of the Golden Gate Bridge in the County of Marin shall be known as the Great Redwood Trail. The facilities described in this subdivision are not the property of the Great Redwood Trail Agency and are not subject to, or within the scope of, the environmental impact report for the Great Redwood Trail, Southern Segment or the Great Redwood Trail within the jurisdiction of the Great Redwood Trail Agency.
ARTICLE 4. Rail Transit Facilities and Service [105095. - 105104.]
The district may provide a rail transit system for the transportation of passengers and their incidental baggage by rail and provision of freight service by rail.
The district may acquire, construct, own, operate, control, or use rights-of-way, rail lines, stations, platforms, switches, yards, terminals, parking lots, and any and all other facilities necessary or convenient for rail transit within and without the district, together with all physical structures necessary or convenient for the access of persons and vehicles thereto, including ancillary bicycle and pedestrian pathways, and may acquire or contract for any interest in or rights to the use or joint use of any or all of the foregoing.
The district may contract with any public agency or person for the operation of shuttle services necessary or convenient for rail transit.
In the County of Marin, north of the City of San Rafael, the district shall locate commuter stations only within areas that are incorporated as of January 1, 2003.
The district may lease or contract for the use of its rail transit facilities, or any portion thereof, to any operator, and may provide for subleases by the operator upon any terms and conditions it deems in the public interest. As used in this section, “operator” means any public agency or any person.
Except as otherwise provided in Section 105143, the board may contract with any public agency or person to provide rail transit facilities and services for the district.
The district may construct and operate or acquire and operate rail transit works and facilities in, under, upon, over, across, or along any state or public highway or any stream, bay or watercourse, or over any of the lands that are the property of the state, to the same extent that these rights and privileges are granted to municipalities within the state.
Except as otherwise provided in Section 105087, the provisions of Article 5 (commencing with Section 53090) of Chapter 1 of Part 1 of Division 2 of Title 5 of the Government Code shall not be applicable to the district.
The district may enter into agreements for the joint use of any property and rights by the district and any city, public agency, or public utility operating transit facilities and may enter into agreements with any city, public agency, or public utility operating any transit facilities, wholly or partially within or without the district, for the joint use of any property of the district or of the city, public agency, or public utility, or for the establishment of through routes, joint fares, transfer of passengers, or pooling agreements.
The district may, without limitation by any other provisions of this part requiring approval of indebtedness, accept contributions of money, grants, loans, rights-of-way, labor, materials, and any other property from the state or the United States, or any department, instrumentality, or agency thereof, or from any public agency for the acquisition, construction, maintenance, and operation of rail transit facilities. The district may, without limitation by any other provisions of this part, enter into any contract and cooperate with and accept cooperation from the state or the United States, or any department, instrumentality, or agency thereof, or any public agency in the acquisition, construction, maintenance, and operation of, and in financing the acquisition, construction, maintenance, and operation of, any rail transit facilities. The district may do any and all things necessary in order to obtain the aid, assistance, and cooperation under any federal or state legislation now or hereafter enacted. Any evidence of indebtedness issued under this section shall constitute a negotiable instrument.
The rates and charges for rail transit service furnished pursuant to this part shall be fixed by the board and shall be reasonable.
The district shall work with the Federal Railroad Administration and any of its successor agencies to achieve safe, efficient, and compatible operations of both passenger rail and freight service along the rail line in the Counties of Sonoma and Marin.
ARTICLE 5. Taxation [105115. - 105115.]
Upon the affirmative vote of a majority of the directors, which shall include an affirmative vote of at least three directors from each county within the district appointed pursuant to subdivisions (a), (b), (c), (d), (e), and (f) of Section 105020, the board may by resolution submit to the voters of the district a measure proposing a retail transactions and use tax ordinance in accordance with the provisions of Part 1.6 (commencing with Section 7251) of Division 2 of the Revenue and Taxation Code.
Notwithstanding any other law, the special taxes authorized in this article may also be imposed by a qualified voter initiative pursuant to Chapter 4 (commencing with Section 9300) of Division 9 of the Elections Code if the qualified voter initiative complies with both of the following requirements:
The qualified voter initiative proposes a rate for the retail transactions and use tax that is no less than one-quarter of 1 percent.
The qualified voter initiative proposes expenditures for the revenues generated from the retail transactions and use tax that are consistent with the purpose of providing a rail transit system under the jurisdiction of the district.
ARTICLE 6. Investments and Deposits [105125. - 105126.]
The district’s investment of any surplus money in its treasury, including money in any sinking fund, shall be in accordance with Article 1 (commencing with Section 53600) of Chapter 4 of Part 1 of Division 2 of the Government Code.
The district’s deposit of district money shall be in accordance with Article 2 (commencing with Section 53630) of Chapter 4 of Part 1 of Division 2 of the Government Code.
CHAPTER 5. Personnel [105140. - 105181.]
ARTICLE 1. Employee Relations [105140. - 105143.]
Except as otherwise provided in this article and in Article 2 (commencing with Section 105150), the determination of questions concerning employee representation and the conduct of employee-employer relations within the district shall be governed by the Meyers-Milias-Brown Act (Chapter 10 (commencing with Section 3500) of Division 4 of Title 1 of the Government Code).
Except as otherwise provided in Article 2 (commencing with Section 105150), whenever a majority of the employees employed by the district in a unit appropriate for collective bargaining indicate a desire to be represented by a labor organization, and upon determining that the labor organization represents at least a majority of the employees in the appropriate unit, the board and the accredited representative of employees shall bargain in good faith and make all reasonable efforts to reach agreement on the terms of a written contract governing wages, hours, and other terms and conditions of employment within the scope of representation set forth in Section 3504 of the Government Code.
If, after a reasonable period of time, representatives of the district and the accredited representatives of the employees fail to reach agreement either on the terms of a written contract governing wages, hours, and other terms and conditions of employment or the interpretation or application of the terms of an existing contract, upon the agreement of both the district and the representatives of the employees, the dispute may be submitted to an arbitration board.
The arbitration board shall be composed of two representatives of the district and two representatives of the labor organization, and they shall endeavor to agree upon the selection of a fifth member. If they are unable to agree, the names of five persons experienced in labor arbitration shall be obtained from the State Conciliation Service. The labor organization and the district shall, alternately, strike a name from this list, and the name remaining after the labor organization and the district have stricken four names shall be designated as the fifth arbitrator and chairperson of the board of arbitration. The labor organization and the district shall determine by lot who shall first strike a name from the list. The decision of a majority of the arbitration board shall be final and binding upon the parties thereto.
Each party shall be responsible for the expense of the presentation of its case. All other expenses of arbitration shall be borne equally by the parties and the expenses may include the making of a verbatim record of the proceedings and transcript of that record.
The district may contract for management services with any public agency or person and may contract for operations and maintenance services with the district organized pursuant to Part 3 (commencing with Section 27000) of Division 16 of the Streets and Highways Code. However, the district may not contract out the performance of services performed by or fairly claimable by employees of a bargaining unit without the agreement of the accredited representative of that bargaining unit’s employees.
ARTICLE 2. Transfer of Collective Bargaining Rights [105150. - 105155.]
The Legislature hereby finds and declares that the creation of the district may adversely affect the collective bargaining rights, wages, benefits, and employment opportunities of employees of the district organized pursuant to Part 3 (commencing with Section 27000) of Division 16 of the Streets and Highways Code.
Notwithstanding the provisions of Article 1 (commencing with Section 105140), in order to protect and preserve the collective bargaining rights of employees of the district organized pursuant to Part 3 (commencing with Section 27000) of Division 16 of the Streets and Highways Code, whose employment opportunities may be adversely affected by the adoption and implementation of this division, upon the district’s decision to commence rail service, the district shall establish at least three collective bargaining units comprised of the following:
A transportation operators collective bargaining unit.
A transportation maintenance collective bargaining unit.
A transportation dispatch and equipment servicing collective bargaining unit.
For purposes of this section, the district’s decision to commence rail service shall be effected by the district’s adoption of a resolution that confirms that sufficient financing exists to undertake rail service and declares the intention of the district to take all reasonable and necessary steps to commence rail service.
For a period of four years, commencing with the district’s decision to commence rail service as provided in Section 105151, or until the expiration of the current collective bargaining agreement, whichever is later, employees of the district organized pursuant to Part 3 (commencing with Section 27000) of Division 16 of the Streets and Highways Code, who are employed by that district in classifications assigned to the same or similar collective bargaining units as those set out in Section 105151, shall be given priority of employment within the collective bargaining units set forth in Section 105151. Any dispute arising over the appropriate placement within a collective bargaining unit or over any assignment of classifications made by the district to a bargaining unit set forth in Section 105151 shall be resolved by the Public Employee Relations Board. Any determination of the Public Employee Relations Board shall be consistent with the intent of this section.
The district shall recognize and bargain with, as the accredited representative of the employees within the collective bargaining units set forth in Section 105151, the accredited collective bargaining representatives that represent the same or similar bargaining units within the district organized pursuant to Part 3 (commencing with Section 27000) of Division 16 of the Streets and Highways Code. This recognition shall be maintained unless changed by mutual agreement of the district and the affected collective bargaining representative or the representative is decertified in accordance with the rules and procedures of the Public Employee Relations Board for the certification and decertification of employee representatives.
Employees of the district organized pursuant to Part 3 (commencing with Section 27000) of Division 16 of the Streets and Highways Code who transfer to the district and into a collective bargaining unit set forth in Section 105151, shall be credited with any accrued seniority earned at the district from which they have transferred, and shall not suffer a loss in their rate of wages, pension benefits, pension accrual rights, health benefits, retiree health benefits, vacation accrual, or other seniority-based benefits, such as job bidding and transfer rights, as a result of their transfer to the district.
To facilitate implementation of the employee rights enumerated in this section, the district and the district organized pursuant to Part 3 (commencing with Section 27000) of Division 16 of the Streets and Highways Code may engage in joint collective bargaining with the accredited representatives of the collective bargaining units set forth in Section 105151 and the same or similar collective bargaining units within the district organized pursuant to Part 3 (commencing with Section 27000) of Division 16 of the Streets and Highways Code to establish uniform wages, health benefits, pension benefits, and other uniform terms and conditions of employment. To maintain continuity of pension benefits, the district shall have the right to appoint at least one representative to any joint labor-management retirement board that administers a retirement plan in which employees of the district and employees of the district organized pursuant to Part 3 (commencing with Section 27000) of Division 16 of the Streets and Highways Code are participants, provided that an equal number of employer and employee representatives on the retirement board is maintained. In addition, the district shall enter into a reciprocity agreement through the Public Employees’ Retirement System (PERS) which recognizes PERS service with the district organized pursuant to Part 3 (commencing with Section 27000) of Division 16 of the Streets and Highways Code of any district employee employed in a collective bargaining unit set forth in Section 105151 whose members’ pensions are provided through PERS.
ARTICLE 3. Rights of Employees of Existing Facilities [105160. - 105161.]
Whenever the district acquires existing facilities from a publicly or privately owned utility, either in proceedings by eminent domain or otherwise, to the extent necessary for operation of facilities, all of the employees of the utility whose duties pertain to the facilities acquired who have been employed by the utility for at least 75 days shall be appointed to comparable positions in the district without examination. These employees shall be given sick leave, seniority, and vacation credits in accordance with the records of the acquired public utility. No employee of any acquired public utility shall suffer any worsening of wages, seniority, pension, vacation, or other benefits by reason of the acquisition.
The provisions of this section shall not apply to officers or managerial employees of the acquired utility except as designated by the board.
Whenever the district acquires existing facilities from a publicly or privately owned utility, either in proceedings in eminent domain or otherwise, that has a pension plan in operation, members and beneficiaries of the pension plan shall continue to have the rights, privileges, benefits, obligations, and status with respect to the established system. The outstanding obligations and liabilities of the public utility by reason of that pension plan shall be considered and taken into account and allowance made therefor in the purchase price of the public utility. The persons entitled to pension benefits as provided in this section and the benefits that are provided shall be specified in the agreement or order by which any public utility is acquired by the district.
ARTICLE 4. Retirement System [105170. - 105172.]
The adoption, terms, and conditions of any retirement system covering employees of the district in a bargaining unit represented by a labor organization shall be pursuant to a collective bargaining agreement between the labor organization and the district. For purposes of this section, “officers” does not include members of the board.
The board may contract with the Board of Administration of the Public Employees’ Retirement System or with a retirement system maintained pursuant to the County Employees Retirement Law of 1937 and enter all, or any portion, of its employees under either of those systems. Employees of the district in a bargaining unit that is represented by a labor organization shall not be included in the contract except as authorized by a collective bargaining agreement.
All persons receiving pension benefits from an acquired public utility, and all persons entitled to pension benefits under any pension plan of the acquired public utility, may become members or receive pensions under a pension plan established by the district by mutual agreement of those persons and the district. The agreement may provide for the waiver of all rights, privileges, benefits, and status with respect to the pension plan of the acquired public utility.
ARTICLE 5. Other Benefits [105181. - 105181.]
The district shall obtain coverage for the district and its employees under the appropriate federal and state workers’ compensation, unemployment compensation, and disability and unemployment insurance laws.
CHAPTER 6. Bonds and Other Evidence of Indebtedness [105200. - 105262.]
ARTICLE 1. Authorization and Issuance of General Obligation Bonds [105200. - 105213.]
Whenever the board deems it necessary for the district to incur a bonded indebtedness for the acquisition or improvement of real property authorized by this part or necessary or convenient for the carrying out of the powers of the district, the board shall, by ordinance, adopted by a vote of two-thirds of all members of the board, so declare and call an election to be held in the district for the purpose of submitting to the qualified voters thereof the proposition of incurring indebtedness by the issuance of bonds of the district, provided the total amount of bonds issued and outstanding pursuant to this article shall not exceed 15 percent of the assessed value of the taxable property of the district as shown by the last equalized assessment roll of the counties within the district. The ordinance shall state:
The purposes for which the proposed debt is to be incurred, which may include all costs and estimated costs incidental to or connected with the accomplishment of those purposes, including, without limitation, engineering, inspection, legal, fiscal agents, financial consultant, and other fees; bond and other reserve funds; working capital; bond interest estimated to accrue during the construction period and for a period not to exceed three years thereafter; and expenses of all proceedings for the authorization, issuance, and sale of the bonds.
The estimated cost of accomplishing those purposes.
The amount of the principal of the indebtedness.
The maximum term the bonds proposed to be issued shall run before maturity, which shall not exceed 50 years from the date thereof or the date of each series thereof.
The maximum rate of interest to be paid, which shall not exceed 7 percent per annum.
The proposition to be submitted to the voters, which may include one or more purposes.
The date of the election.
The manner of holding the election and the procedure for voting for or against the measure.
The ordinance may also contain any other matters authorized by this part or any other law.
Notice of holding of the election shall be given by publishing, pursuant to Section 6066 of the Government Code, the ordinance calling the election in at least one newspaper published in the district. No other notice of the election need be given. Except as otherwise provided in the ordinance, the election shall be conducted as other district elections.
If any proposition is defeated by the electors, the board shall not call another election on a substantially similar proposition to be held within six months after the prior election. If a petition requesting submission of this type of a proposition, signed by 15 percent of the district electors, as shown by the votes cast for all candidates for governor within the district at the last gubernatorial election, is filed with the board, the board may call an election before the expiration of six months.
If two-thirds of the electors voting on the proposition vote for it, then the board may, by resolution, at the time or times it deems proper, issue bonds of the district for the whole or any part of the amount of the indebtedness so authorized and may from time to time, by resolution, provide for the issuance of any necessary amounts, until the full amount of the bonds authorized shall have been issued. The full amount of bonds may be divided into two or more series and different dates and different dates of payment fixed for the bonds of each series. A bond need not mature on an anniversary of its date. The maximum term the bonds of any series shall run before maturity shall not exceed 50 years from the date of each series respectively. In the resolution or resolutions, the board shall prescribe the form of the bonds (including, without limitation, registered bonds and coupon bonds) and the form of any coupons to be attached thereto, the registration, conversion, and exchange privileges, if any, pertaining thereto, and fix the time when the whole or any part of the principal shall become due and payable.
The bonds shall bear interest at a rate or rates not exceeding 7 percent per annum, payable semiannually, except that the first interest payable on the bonds or any series thereof may be for any period not exceeding one year as determined by the board. In the resolution or resolutions providing for the issuance of the bonds, the board may also provide for call and redemption of the bonds prior to maturity at the times and prices and upon any other terms it may specify, but no bond shall be subject to call or redemption prior to maturity unless it contains a recital to that effect or unless a statement to that effect is printed thereon. The denomination or denominations of the bonds shall be stated in the resolution providing for their issuance, but shall not be less than one thousand dollars ($1,000). The principal of and interest on the bonds shall be payable in lawful money of the United States at the office of the treasurer of the district or at any other place or places that may be designated, or at either place or places at the option of the holders of the bonds. The bonds, or series thereof, shall be dated and numbered consecutively and shall be signed by the chairperson of the board and the treasurer, countersigned by the secretary and the official seal of the district attached. The interest coupons of the bonds shall be signed by the treasurer. All signatures, countersignatures, and seal may be printed, lithographed, or mechanically reproduced, except that one of the signatures or countersignatures on the bonds shall be manually affixed. If any officer whose signature or countersignature appears on bonds or coupons ceases to be an officer before the delivery of the bonds, his or her signature is as effective as if he or she had remained in office.
The bonds may be sold as the board determines by resolution but for not less than par. Before selling the bonds or any part thereof, the board shall give notice inviting sealed bids in a manner as it may prescribe. If satisfactory bids are received, the bonds offered for sale shall be awarded to the highest responsible bidder. If no bids are received or if the board determines that the bids received are not satisfactory as to price or responsibility of the bidders, the board may reject all bids received, if any, and either readvertise or sell the bonds at private sale.
Delivery of any bonds may be made at any place either inside or outside the state, and the purchase price may be received in cash or bank credits.
All accrued interest and premiums received on the sale of bonds shall be placed in the fund to be used for the payment of principal of and interest on the bonds and the remainder of the proceeds of the bonds shall be placed in the treasury to the credit of the proper improvement fund and applied exclusively to the purposes for which the debt was incurred; provided, however, that when those purposes have been accomplished any moneys remaining in the improvement fund (a) shall be transferred to the fund to be used for the payment of principal of and interest on the bonds, or (b) shall be placed in a fund to be used for the purchase of outstanding bonds of the district from time to time in the open market at the prices and in the manner, either at public or private sale or otherwise, as the board may determine. Bonds so purchased shall be canceled immediately.
After the expiration of three years after a bond election the board may determine, by ordinance adopted by a vote of two-thirds of all the members of the board, that any or all of the bonds authorized at the election remaining unsold shall not be issued or sold. When the ordinance takes effect, the authorization to issue these bonds shall become void.
Whenever the board deems that the expenditure of money for the purposes for which the bonds were authorized by the voters is impractical or unwise, it may, by ordinance adopted by a vote of two-thirds of all members of the board, so declare and call an election to be held in the district for the purpose of submitting to the qualified voters thereof the proposition of incurring indebtedness by the issuance of these bonds for some other purposes or, in the case where bonds have been sold, the proposition to use the proceeds for some other purposes. The procedure, so far as applicable, shall be the same as when a bond proposition is originally submitted.
The board may provide for the issuance, sale, or exchange of refunding bonds to redeem or retire any bonds issued by the district upon the terms, at the times, and in the manner which it determines. Refunding bonds may be issued in a principal amount sufficient to pay all or any part of the principal of the outstanding bonds, the interest thereon, and the premiums, if any, due upon call and redemption thereof prior to maturity and all expenses of the refunding. The provisions of this article for issuance and sale of bonds apply to the issuance and sale of the refunding bonds, except that (a) no election need be called or held for the purpose of authorizing the issuance of refunding bonds, and (b) when refunding bonds are to be exchanged for outstanding bonds, the method of exchange shall be determined by the board.
The provisions of Article 4 (commencing with Section 53500) of Chapter 3 of Part 1 of Division 2 of Title 5 of the Government Code are applicable to the district.
Any bonds that are issued under the provisions of this article shall be legal investment for all trust funds; for the funds of insurance companies, banks, both commercial and savings, and trust companies; and for state school funds. Whenever any money or funds may, by any law now or hereafter enacted, be invested in bonds of cities, cities and counties, counties, school districts, or other districts within the state, the money or funds may be invested in the bonds issued under this part. Whenever bonds of cities, cities and counties, counties, school districts, or other districts within this state may, by any law now or hereafter enacted, be used as security for the performance of any act or the deposit of any public moneys, the bonds issued under this part may be so used. The provisions of this article shall be in addition to all other laws relating to legal investments and shall be controlling as the latest expression of the Legislature with respect thereto.
The board may enter into any covenants deemed proper to provide for issuance of additional parity bonds and the priority and pledge of special taxes; and any other covenants that are customary or desirable in the issuance of any bonds payable out of special funds or that are necessary, convenient, or desirable to secure the bonds or tending to make them more marketable, subject to the provisions of the ordinance calling the bond election.
ARTICLE 2. Revenue Bonds [105220. - 105221.]
The district may issue bonds, payable from revenue of any facility or enterprise to be acquired or constructed by the district, in the manner provided by the Revenue Bond Law of 1941 (Chapter 6 (commencing with Section 54300) of Part 1 of Division 2 of Title 5 of the Government Code), all of the provisions of which are applicable to the district, except that Article 3 (commencing with Section 54380) of Chapter 6 of Part 1 of Division 2 of Title 5 of the Government Code and the limitations set forth in subdivision (b) of Section 54402 and in Sections 54403 and 54418 of the Government Code do not apply to the issuance and sale of bonds pursuant to this article. As used in Section 54315 of the Government Code, “revenues” shall include, but not be limited to, the proceeds of, or any portion of the proceeds of, a sales and use tax imposed under Article 5 (commencing with Section 105115) of Chapter 4 or under any other provisions of law, so long as the resolution authorizing the bonds contains no restriction that would provide that this tax shall not continue to be imposed until the bonds are fully paid or a provision has been made for their payment in full.
The district is a local agency within the meaning of the Revenue Bond Law of 1941, Chapter 6 (commencing with Section 54300) of Part 1 of Division 2 of Title 5 of the Government Code. The term “enterprise” as used in the Revenue Bond Law of 1941 shall, for all purposes of this part, include the system or any or all rail transit facilities and all additions, extensions, and improvements thereto authorized to be acquired, constructed, or completed by the district. The district may issue revenue bonds under the Revenue Bond Law of 1941, for any one or more rail transit facilities authorized to be acquired, constructed, or completed by the district or, in the alternative, may issue revenue bonds under the Revenue Bond Law of 1941, for the acquisition, construction, and completion of any rail transit facilities. Nothing in this article shall prevent the district from availing itself of, or making use of, any procedure provided in this part for the issuance of bonds of any type or character for any of the rail transit facilities authorized hereunder, and all proceedings may be carried on simultaneously or, in the alternative, as the board may determine.
ARTICLE 3. Equipment Trust Certificates [105230. - 105233.]
The district shall have power to purchase rail transit equipment such as cars or rolling equipment; and may execute agreements, leases, and equipment trust certificates in the forms customarily used by private corporations engaged in the rail transit business appropriate to effect purchase and leasing of rail transit equipment and may dispose of the equipment trust certificates upon the terms and conditions the board deems appropriate. Payment for the equipment, or rentals therefor, may be made in installments, and the deferred installments may be evidenced by equipment trust certificates payable from any source or sources of funds specified in the certificates that are or will be legally available to the district. Title to the equipment shall not rest in the district until the equipment trust certificates are paid.
The agreement to purchase or lease may direct the vendor or lessor to sell and assign or lease the rolling equipment to a bank or trust company duly authorized to transact business in the state as trustee, for the benefit and security of the equipment trust certificates and may direct the trustee to deliver the rolling equipment to one or more designated officers of the district and may authorize the district to execute and deliver simultaneously therewith an installment purchase agreement or a lease of the equipment to the district.
The agreements and leases shall be duly acknowledged before a person authorized by law to take acknowledgments of deeds and in the form required for acknowledgment of deeds. The agreements, leases, and equipment trust certificates shall be authorized by resolution of the district and shall contain the covenants, conditions, and provisions deemed necessary or appropriate to insure the payment of the equipment trust certificates from legally available sources of funds specified in the certificates.
The covenants, conditions, and provisions of the agreements, leases, and equipment trust certificates shall not conflict with any of the provisions of any trust agreement securing the payment of bonds, notes, or certificates of the district.
ARTICLE 4. Improvement Acts and Special Benefit Districts [105240. - 105241.]
The Improvement Act of 1911 (Part 1 (commencing with Section 5000) of Division 7 of the Streets and Highways Code), the Municipal Improvement Act of 1913 (Chapter 1 (commencing with Section 10000) of Division 12 of the Streets and Highways Code), and the Improvement Bond Act of 1915 (Part 1 (commencing with Section 8500) of Division 10 of the Streets and Highways Code) are applicable to the district.
The provisions of Chapter 1 (commencing with Section 99000) of Part 11 of Division 10 of the Public Utilities Code are applicable to the district.
ARTICLE 5. Temporary Borrowing [105250. - 105251.]
The district may borrow money in accordance with the provisions of Article 7 (commencing with Section 53820), or of Article 7.6 (commencing with Section 53850) of Chapter 4 of Part 1 of Division 2 of Title 5 of the Government Code.
The district may borrow money in anticipation of the sale of bonds that have been authorized to be issued, but have not been sold and delivered, and may issue negotiable bond anticipation notes therefor and may renew the same from time to time. The maximum maturity of those notes, including the renewals thereof, shall not exceed five years from the date of delivery of the original notes. The notes may be paid from any moneys of the district available therefor and not otherwise pledged. If not previously otherwise paid, the notes shall be paid from the proceeds of the next sale of the bonds of the district in anticipation of which they were issued. The notes shall not be issued in any amount in excess of the aggregate amount of bonds which the district has been authorized to issue, less the amount of any bonds of that authorized issue previously sold, and also less the amount of other bond anticipation notes therefor issued and then outstanding. The notes shall be issued and sold in the same manner as the bonds. The notes and the resolution or resolutions authorizing them may contain any provisions, conditions, or limitations that a resolution of the district authorizing the issuance of bonds may contain.
ARTICLE 6. Miscellaneous [105260. - 105262.]
The district may bring an action to determine the validity of any of its bonds, equipment trust certificates, warrants, notes, or other evidences of indebtedness pursuant to Chapter 9 (commencing with Section 860) of Title 10 of Part 2 of the Code of Civil Procedure.
All bonds and other evidences of indebtedness issued by the district under the provisions of this part, and the interest thereon, are free and exempt from all taxation within the state, except for transfer, franchise, inheritance, and estate taxes.
Notwithstanding any other provisions of this part or any other law, the provisions of all ordinances, resolutions, and other proceedings in the issuance by the district of any bonds, bonds with a pledge of revenues, bonds for improvement districts, revenue bonds, equipment trust certificates, notes, or any and all evidences of indebtedness or liability shall constitute a contract between the district and the holders of the bonds, equipment trust certificates, notes, or evidences of indebtedness or liability and the provisions thereof shall be enforceable against the district, or any or all of its successors or assigns, by mandamus or any other appropriate suit, action, or proceeding in law or in equity in any court of competent jurisdiction. Nothing contained in this part or in any other law shall be held to relieve the district or the territory included within it from any bonded or other debt or liability contracted by the district. Upon dissolution of the district or upon withdrawal of territory therefrom, the property formerly included within the district or withdrawn therefrom shall continue to be liable for the payment of all bonded and other indebtedness or liabilities outstanding at the time of the dissolution or withdrawal the same as if the district had not been so dissolved or the territory withdrawn therefrom, and it shall be the duty of the successors or assigns to provide for the payment of the bonded and other indebtedness and liabilities. Except as may be otherwise provided in the proceedings for the authorization, issuance, and sale of any revenue bonds, bonds secured by a pledge of revenues or bonds for improvement districts secured by a pledge of revenues, revenues of any kind or nature derived from any revenue-producing improvements, works, facilities, or property owned, operated or controlled by the district shall be pledged, charged, assigned, and have a lien thereon for the payment of the bonds as long as they are outstanding, regardless of any change in ownership, operation, or control of those revenue-producing improvements, works, facilities, or property and it shall, in such later event or events, be the duty of the successors or assigns to continue to maintain and operate the revenue-producing improvements, works, facilities, or property as long as bonds are outstanding.
CHAPTER 7. Annexation [105280. - 105288.]
Territory may be annexed to the district in the manner provided in this chapter.
A county contiguous to the district may, by majority vote of the board of supervisors of that county, petition the district to annex all or part of the territory within the county. Alternatively, the board of the district may propose annexation of any territory contiguous to the district.
If annexation is proposed pursuant to Section 105281, the board shall determine whether the additional territory proposed to be annexed will be benefited by annexation to the district, and shall pass a resolution to that effect. The resolution shall be passed by a vote of two-thirds of the members of the board and be approved by the board of supervisors of the county in which the territory is situated.
The board of supervisors of the county in which the territory to be annexed is situated shall agree in writing with the board of directors of the district upon the terms and conditions of annexation. The agreement may provide for the levy and collection of special taxes within the county in addition to the taxes elsewhere provided for in this part, the fixing of rates, rentals, and charges differing from those fixed or existing elsewhere within the district, the incurring or assumption of indebtedness, the making of a payment or payments, or the transfer of property, real and personal, and other assets to the district by the county.
The resolution shall:
Describe the boundaries of the territory proposed to be annexed.
Designate the proposed annexation by an appropriate name.
Declare that the area to be annexed to the district will be benefited by annexation.
Name the time and place for the hearing of objections by any person interested in the proposed annexation.
Describe any terms and conditions of annexation agreed to between the district and the county pursuant to Section 105283.
The resolution, together with the names of the members of the board voting for and against it, shall be published pursuant to Section 6066 of the Government Code in a newspaper published in the territory proposed to be annexed, or if there is no paper, then in some newspaper of general circulation, circulated in the territory.
On the day fixed for hearing or on any day to which the hearing is adjourned, the board shall hear and consider any objections presented to the annexation of the territory. After the hearing of objections, if it is determined by a vote of two-thirds of all the members of the board that the territory proposed to be annexed will be benefited by annexation, the board shall proceed to fix and determine the boundaries of the territory to be annexed to the district.
After making all necessary and proper changes in the boundaries, by a resolution passed by a vote of two-thirds of the members, the board shall order the annexation of the territory so described. The resolution, together with the names of the members of the board voting for and against the same shall be set forth in the minutes of the board.
Whenever any territory is annexed to the district it shall thereupon become a part of the district subject to all the liabilities and entitled to all the benefits of the district.
CHAPTER 8. Service Zones [105300. - 105310.]
One or more service zones to provide different levels of service, to provide different facilities or other improvements, or to raise additional revenues within specific areas of the district, may be created within the boundaries of the district. A service zone may consist of one or more cities, with or without unincorporated territory, or unincorporated territory alone.
Proceedings for the creation of a service zone may be initiated by resolution of the legislative body or bodies of the city or cities proposed to be included in the service zone, and if unincorporated territory is proposed to be included in the service zone, by resolution of the board or boards of supervisors of the county or counties in which the unincorporated territory is situated.
The resolution or resolutions shall declare that the public interest or necessity demands the creation of a service zone, shall describe its boundaries, and shall request the formation of the service zone.
When the entire area of a public agency is to be included in the service zone, it may be described by name.
Certified copies of the resolution or resolutions shall be filed with the secretary of the district.
As an alternative to the initiation of proceedings for the formation of a service zone by resolution or resolutions, a petition may be filed with the secretary of the district signed by voters equal in number to at least 25 percent of the registered voters registered within the proposed service zone as determined from the affidavits of registration. The boundaries of the proposed service zone shall be described in the petition. When the entire area of a public agency is to be included in the service zone, it may be described by name.
The petition shall declare that the public interest or necessity demands the creation of a service zone within the area of the district described in the petition. The petition may include one or more separate documents, but each document shall contain the affidavit of the party who circulated it, certifying that each name signed thereto is the true signature of the person whose name it purports to be.
The secretary of the district shall compare the signatures in the petition with the affidavits of registration on file with the county election official. The secretary of the district also shall certify to the sufficiency or insufficiency of the petition.
Within 30 days after receipt of the resolution or resolutions of the legislative body or bodies or receipt of the certification of the sufficiency of a petition by the secretary of the district, the board shall initiate proceedings for the formation of a new service zone by adopting a resolution that does all of the following:
Sets forth a description of the boundaries of the territory to be included in the service zone.
States the different services, different levels of service, or additional revenues that the service zone will provide.
Sets forth the methods by which those services or levels of service will be financed.
States the reasons for forming the service zone.
Proposes a name or number for the service zone.
Fixes the date, time, and place for the public hearing regarding the formation of the service zone.
The district shall publish notice of the hearing, including the information required by subdivision (a), pursuant to Section 6061 of the Government Code, in one or more newspapers of general circulation in the district. The district shall mail the notice to all owners of property within the proposed service zone. The district shall post the notice in at least three public places within the territory of the proposed service zone.
At the hearing, the board shall hear and consider any protests to the formation of the service zone. At the conclusion of the hearing, the board may adopt a resolution ordering the formation of the service zone.
The board may change the boundaries of a service zone or dissolve a zone by following the procedures in Section 105301.
A local agency formation commission shall have no power or duty to review and approve or disapprove a proposal to create a service zone, a proposal to change the boundaries of a zone, or a proposal to dissolve a zone.
As determined by the board, a service zone may provide any service at any level within its boundaries that the district may provide.
As determined by the board and pursuant to the requirements of this part, a service zone may exercise any fiscal powers within its boundaries that the district may exercise.
Any taxes, special taxes, assessments, or fees which are intended solely for the support of services within a zone shall be levied, assessed, and collected only within the boundaries of the zone.
To assist in the operation of a service zone, the board may appoint one or more advisory groups composed of persons who reside in or own property in the zone.
CHAPTER 9. Dissolution [105330. - 105337.]
If the district operates no rail transit facilities, the board may call an election at any time for the purpose of submitting to the voters of the district the question of whether the district shall be dissolved. Upon the filing with the secretary of the district of a petition signed by voters within the district equal in number to at least 25 percent of the total vote cast at the last general statewide election, asking that the question of dissolution of the district be submitted to the voters of the district, the board shall call the election.
The election for the purpose of submitting to the voters of the district the question of whether or not the district shall be dissolved shall be held within 60 days following the date on which the petition is filed.
Notice of any election for dissolution, whether called because of the filing of a petition or ordered by the board without petition, shall be published. The date fixed for the election shall not be less than 30 days from the date of the first publication of the notice.
The ballots for the election shall contain substantially the instructions required to be printed on ballots for use at general state and county elections and, in addition, the following:
The board shall canvass the vote. If a majority of the votes favor dissolution, the board shall by resolution dissolve the district.
The board shall file a certified copy of the resolution with the Secretary of State and for record in the office of the county recorder of the Counties of Marin and Sonoma and any other county in which territory of the district is situated.
Upon dissolution, the right, title, and interest to any property owned or controlled by the district that was acquired by the district from the Golden Gate Bridge, Highway and Transportation District shall be returned to the Golden Gate Bridge, Highway and Transportation District or disposed of as designated by the Golden Gate Bridge, Highway and Transportation District. It is the intent of the Legislature that any remaining property continue to be held in public ownership. A joint powers agency, members of which may include the Counties of Marin and Sonoma and the Golden Gate Bridge, Highway and Transportation District, may be formed to hold title to the remaining district property. If a joint powers agency cannot be formed, the district, in consultation with the Counties of Humboldt, Marin, Mendocino, and Sonoma, and the Golden Gate Bridge, Highway and Transportation District, shall make a recommendation to the Legislature regarding an appropriate disposition of the property.
The board shall wind up the affairs of the district.
PART 17. Monterey-Salinas Transit District [106000. - 106064.]
CHAPTER 1. General Provisions [106000. - 106001.]
This part shall be known and may be cited as the Monterey-Salinas Transit District Act.
As used in this part, the following terms have the following meanings:
“Agency” means the Monterey-Salinas Transit Joint Powers Agency, a joint exercise of powers agency.
“Board of directors” or “board” means the Board of Directors of the Monterey-Salinas Transit District.
“Board of supervisors” means the Monterey County Board of Supervisors.
“County” means Monterey County.
“District” means the Monterey-Salinas Transit District created by Section 106010.
CHAPTER 2. Formation of District [106010. - 106013.]
There is hereby created the Monterey-Salinas Transit District. The jurisdiction of the district extends throughout the county, including all of the incorporated and unincorporated territory.
On and after July 1, 2010, the agency is dissolved and the district succeeds to, and is vested with, all of the rights, powers, duties, and obligations of the agency. The district is the successor to the agency’s interests in any property, its rights and obligations under any contract, any outstanding indebtedness of the agency, and its rights under any grants, without the necessity of any further action.
The district shall assume the duties of public transit provider performed by the agency. On and after July 1, 2010, the Cities of Carmel-by-the-Sea, Del Rey Oaks, Marina, Monterey, Pacific Grove, Salinas, Seaside, Gonzales, Soledad, Greenfield, King City, Sand City, the County of Monterey, and other jurisdictions that subsequently qualify as members pursuant to the requirements set forth in Section 106020 are included within the district.
Additionally, the district is deemed to be, with all of the powers and duties attendant thereto, the consolidated transportation services agency for the county, with the concurrence of the regional transportation planning agency.
Upon dissolution of the agency, employees of the agency shall be deemed to be employees of the district without any break in service or any loss or reduction of compensation or benefits, except as may be imposed by express action of the board.
CHAPTER 3. Government of District [106020. - 106033.]
ARTICLE 1. Board of Directors [106020. - 106023.]
The district shall be governed by a board of directors which shall be composed of one representative from each member jurisdiction. Each member of the board of directors shall have one vote. Each member jurisdiction shall appoint one regular member and one alternate member to the board of directors and shall notify the district in writing of its appointments or any change of representative.
Membership of the district shall be limited to the County of Monterey and incorporated cities within the county and includes the county and each city that gives the district the right of first priority for use of any local, state, or federal funds allocated specifically for public transit systems and to which the city member might otherwise be entitled to claim as, but not limited to, local transportation funds pursuant to Chapter 4 (commencing with Section 99200) of Part 11. The county shall give the district the right of first priority of use of any local, state, or federal funds allocated specifically for public transit to which the county might otherwise be entitled to claim as, but not limited to, local transportation funds pursuant to Chapter 4 (commencing with Section 99200) of Part 11 according to a ratio of unincorporated population within three-quarters of a mile of the district transit routes to the total unincorporated population of the county.
Each member shall serve solely at the pleasure of the appointing member jurisdiction. Members shall be either elected officials or officers or employees of the appointing member jurisdiction.
If any portion of the unincorporated area of the county is annexed to a member city, that city shall assume the obligation of the county for that area. If any portion of the unincorporated area of the county becomes incorporated, that city shall assume the obligations of the county for that area.
The board shall adopt bylaws for its proceedings consistent with the laws of the state.
The board shall do all of the following:
Adopt an annual budget.
Adopt an administrative code, by ordinance, which prescribes the powers and duties of the district officers, the method of appointment of the district employees, and methods, procedures, and systems of operation and management of the district.
Cause a postaudit of the financial transactions and records of the district to be made at least annually by a certified public accountant.
Do any and all things necessary to carry out the purposes of this part.
The board of directors shall adopt priorities reflecting the district’s goals.
ARTICLE 2. Meetings [106030. - 106033.]
The board, at its first meeting, and thereafter annually at the meeting designated by the board, shall elect a chairperson who shall preside at all meetings, and a vice chairperson who shall preside in the absence of the chairperson. In the event of his or her absence or inability to act, the members present, by an order entered in the minutes, shall select one of their members to act as chairperson pro tempore, who, while so acting, shall have all the authority of the chairperson.
All meetings of the board shall be conducted pursuant to Chapter 9 (commencing with Section 54950) of Part 1 of Division 2 of Title 5 of the Government Code.
A majority of the board of directors entitled to vote constitutes a quorum for the transaction of business. All official acts of the district require the affirmative vote of a majority of the board of directors entitled to vote.
The acts of the board shall be expressed by motion, resolution, or ordinance.
CHAPTER 4. Powers and Functions of the District [106040. - 106064.]
ARTICLE 1. Personnel [106040. - 106041.]
The district may hire an independent staff of its own or contract with any department or agency of the United States or with any public agency to implement this part.
The district may contract with private entities in conformance with applicable procurement procedures for the procurement of engineering, project management, and contract management services.
The board of directors shall fix the compensation of the district’s officers and employees.
ARTICLE 2. Annual Budget [106045. - 106045.]
Notice of the time and place of a public hearing on the adoption of the annual budget shall be published pursuant to Section 6061 of the Government Code not less than 15 days prior to the day of the hearing.
The proposed annual budget shall be available for public inspection at least 15 days prior to the hearing.
ARTICLE 3. Corporate Powers [106050. - 106051.]
The district may sue and be sued, except as otherwise provided by law, in all actions and proceedings, in all courts and tribunals of competent jurisdiction.
All claims for money or damages against the district are governed by Division 3.6 (commencing with Section 810) of Title 1 of the Government Code, except as provided therein, or by other statutes or regulations expressly applicable thereto.
ARTICLE 4. Contracts [106055. - 106057.]
The district may make contracts and enter into stipulations of any nature whatsoever, either in connection with eminent domain proceedings or otherwise, including, but not limited to, contracts and stipulations to indemnify and hold harmless, to employ labor, and to perform all acts necessary and convenient for the full exercise of the powers granted in this part.
The district may contract with any department or agency of the United States, with any public agency, including, but not limited to, the Department of Transportation, any county, city, or district, or with any person or a private entity upon the terms and conditions that the district finds in its best interest for the procurement of engineering, project management, and contract management services.
The purchase of all supplies, equipment, and materials, when the expenditure required exceeds one hundred fifty thousand dollars ($150,000), shall, by contract, be let to the lowest responsible bidder, or, in the district’s discretion, to the responsible bidder who submitted a proposal that provides the best value to the district on the basis of the factors identified in the solicitation. “Best value” means the overall combination of quality, price, and other elements of a proposal that, when considered together, provide the greatest overall benefit in response to the requirements described in the solicitation documents.
To the extent practicable, the district shall obtain a minimum of three quotations, either written or oral, that permit prices and terms to be compared whenever the expected expenditure required for the purchase of supplies, equipment, or materials exceeds five thousand dollars ($5,000), but does not exceed one hundred fifty thousand dollars ($150,000).
This section shall become operative on January 1, 2030.
ARTICLE 5. Financing [106060. - 106064.]
The district has no authority to impose sales or special taxes, but may, with the concurrence of a majority of the member jurisdictions represented on the board of directors, cause to be submitted to voters of the district a ballot measure for the imposition of those taxes. A ballot measure shall not be submitted to the voters of the district pursuant to this subdivision on or after January 1, 2026.
The district, upon the affirmative vote of at least two-thirds of the board of directors, may submit to the voters of the district a measure proposing a retail transactions and use tax ordinance in accordance with the Transactions and Use Tax Law (Part 1.6 (commencing with Section 7251) of Division 2 of the Revenue and Taxation Code).
Notwithstanding any other law, the district may impose a transactions and use tax pursuant to Chapter 3.95 (commencing with Section 7300.5) of Part 1.7 of Division 2 of the Revenue and Taxation Code.
If approved as required by law, the district may impose and administer fees and other funding sources secured for transportation system operation, maintenance, and improvement.
The board of directors may set fares for public transit service by resolution or minute order.
The district may issue bonds not to exceed the amount of fifty million dollars ($50,000,000), payable in whole or in part from revenues of any enterprise acquired, constructed, or completed, or to be acquired, constructed, or completed, by the district, in the manner provided by the Revenue Bond Law of 1941 (Chapter 6 (commencing with Section 54300) of Part 1 of Division 2 of Title 5 of the Government Code), all of the provisions that apply to the district, except that Article 3 (commencing with 54380) of Chapter 6 of Part 1 of Division 2 of Title 5 of the Government Code and the restrictions in that article, including, but not limited to, restrictions on the securing of bonds by the taxing power or the proceeds of taxation, do not apply to the issuance and sale of bonds pursuant to this article and, instead, the district shall authorize the issuance of those bonds by resolution of its governing board approved by a two-thirds vote of the board. The district is a local agency within the meaning of the Revenue Bond Law of 1941. The term “enterprise” as used in the Revenue Bond Law of 1941 shall, for all purposes of this section, include transit equipment or facilities and any and all additions and improvements thereto and all other equipment or facilities authorized to be acquired, constructed, or completed by the district, but only for a project or projects not located on or adjacent to the former Fort Ord, except a project or projects located entirely within the existing right-of-way of State Highway Route 1 owned by the Department of Transportation or within the existing right-of-way of the Monterey branch rail line owned by the Transportation Agency for Monterey County. Bonds issued for the acquisition of equipment shall be of a duration that does not exceed the useful life of the equipment. Any revenues or other income, receipts, or amounts made available to the district, including, but not limited to, the proceeds of a transactions and use tax, shall be deemed revenues of the enterprise for purposes of the Revenue Bond Law of 1941. This article shall not prevent the district from availing itself of, or making use of, any procedure provided in this part for the issuance of bonds of any type or character for any enterprise authorized under this part, and all proceedings may be carried on simultaneously or in the alternative, as the board may determine. As used in this section, “equipment” includes “vehicles.”
The district may advocate and act on behalf of all district member jurisdictions with their concurrence to further Monterey County transportation system interests, funding, projects, and priorities.
The district may promulgate a plan for funding transportation projects within its jurisdiction.
PART 18. GOLD COAST TRANSIT DISTRICT [107000. - 107025.]
CHAPTER 1. General Provisions [107000. - 107002.]
This part shall be known and may be cited as the Gold Coast Transit District Act.
The purpose of the transit district is to develop, provide, operate, and administer public transportation and to protect the public interest, health, and welfare.
As used in this part, the following terms have the following meanings:
“Agency” means Gold Coast Transit, a joint powers agency created pursuant to Article 1 (commencing with Section 6500) of Chapter 5 of Division 7 of Title 1 of the Government Code.
“Board of directors” or “board” means the board of directors of the district.
“Board of Supervisors” means the Ventura County Board of Supervisors.
“County” means the County of Ventura.
“Director” means a voting member of the board of directors.
“District” means the Gold Coast Transit District created by this part.
“General manager” means the person defined in subdivision (d) of Section 107020.
“Member” means the County of Ventura, the Cities of Oxnard, San Buenaventura (Ventura), Port Hueneme, and Ojai, and any other city within the County of Ventura that joins as a member of the district as set forth in this part. No person or entity of any kind that is not the county or a city in the county may be a member.
“Transit” means the transportation of passengers and their incidental baggage.
“Transit facilities” means any and all real and personal property, easements, licenses, equipment, facilities, rights, title, or interests owned or acquired by the district for transit services and the operation thereof.
“Voter” means any elector who is registered under the Elections Code.
CHAPTER 2. Formation of District [107003. - 107009.]
There is hereby created the Gold Coast Transit District. The jurisdiction of the district includes the Cities of Oxnard, San Buenaventura (Ventura), Port Hueneme, and Ojai and the unincorporated areas of the County of Ventura, and other cities that subsequently qualify as members pursuant to the requirements set forth in Section 107006.
On and after July 1, 2014, the agency is dissolved and the district succeeds to, and is vested with, all of the rights, powers, duties, and obligations of the agency. The district is the successor to the agency’s assets, interests in any property, its rights and obligations under any contract, any outstanding indebtedness of the agency, and its rights under any grants, without the necessity of any further action.
The district shall assume the duties of public transit provider performed by the agency. On and after July 1, 2014, the Cities of Oxnard, San Buenaventura (Ventura), Port Hueneme, Ojai, the County of Ventura, and other jurisdictions that subsequently qualify as members pursuant to the requirements set forth in Section 107006 are included within the district.
Any city within the County of Ventura, other than a city specifically listed in Section 107003 that is already included in the district at its formation, may join as a member of the district upon approval by its city council of a resolution approving the city’s joining as a member and a resolution of the district’s board approving the joining of the new member.
If any portion of the unincorporated area of the county is annexed to a member city, that city shall assume the service obligation of the county for that area. If any portion of the unincorporated area of the county becomes incorporated, the incorporating city shall assume the service obligations of the county for that area.
Upon dissolution of the agency, employees of the agency shall be deemed to be employees of the district without any break in service or any loss or reduction of compensation or benefits, except as may be imposed by express action of the board.
Notwithstanding subdivisions (a) and (c) of Section 99231 of the Public Utilities Code, the apportionment area for the County of Ventura includes the unincorporated area of the county, regardless of whether that area is also within the boundaries of the district.
Notwithstanding Section 99209 of the Public Utilities Code, the County of Ventura, including any nonprofit corporation or other legal entity wholly owned or controlled by the County of Ventura, is a municipal operator if it operates a public transportation system regardless of whether the County of Ventura is included, in whole or in part, within the district. All members of the district may claim from the district a portion of the funds made available from the local transportation fund apportioned by the Ventura County Transportation Commission to the district for transit services, including the operation of locally supported transit service and maintenance of the transit facilities not provided by the district that the member funds or operates.
CHAPTER 3. Government of the District [107010. - 107010.]
The district shall be governed by a board composed of a minimum of five directors, which may be expanded with the addition of new member cities but shall not exceed 11 directors. One director shall be appointed by the governing body of each member. Each director shall serve at the pleasure of the director’s appointing authority. Directors appointed pursuant to the joint powers agreement, which is superseded by formation of the district, shall continue to serve at the pleasure of the director’s appointing authority. Each director shall at all times during the director’s term be a member of the governing body of the member that appointed the director.
The governing body of each member shall also appoint an alternate director, who shall serve on the board during the absence or disability of the member’s regular director. The alternate director shall meet the same qualifications and shall serve upon the same conditions and for the same term as the regular director. Whenever the alternate director serves on the board, the alternate director shall have all the powers of a regular director.
The board may designate one or more ex officio members based on district adopted procedures. The duties and responsibilities of such nonvoting ex officio members shall be set forth in the adopted bylaws.
All actions of the board shall be by majority vote on a one director, one vote formula with the exception of votes on the annual budget, midyear budget changes and amendments, and capital expenditures of five million dollars ($5,000,000) or more. The vote for these specific issues shall be weighted, as set forth in subdivision (e).
Where this subdivision is applicable, a director appointed by a member whose population is under 100,000 shall have a vote whose value and effect is equal to 1.0 vote and a director appointed by a member whose population is 100,000 or more shall have a vote whose value and effect is equal to 2.0 votes. The annual population estimates of the Department of Finance shall be used with an updated formula presented to the board annually at the first board meeting after release of the estimates. The weighted vote of any single director shall not, of itself, be given the value or effect of a majority vote. A weighted vote may not be split by any director.
The board shall adopt bylaws for its proceedings consistent with the laws of the state.
The board shall do all of the following:
Adopt an annual budget.
Adopt an administrative code, by ordinance, which prescribes the powers and duties of the district officers, the method of appointment of the district employees, and the methods, procedures, and systems of operation and management of the district.
Make determination of policy for the district.
Adopt a conflict-of-interest code.
Cause a postaudit of the financial transactions and records of the district to be made at least annually by a certified public accountant.
Create and administer funds of the district.
Adopt priorities reflecting the district’s goals.
Do any and all things necessary to carry out the purposes of this part.
CHAPTER 4. Meetings [107011. - 107014.]
The board, at its first meeting, and thereafter annually at the meeting designated by the board, shall elect a chair, who shall preside at all meetings, and a vice chair, who shall preside in the absence of the chair. In the event of the chair’s or vice chair’s absence or inability to act, the directors present, provided a quorum exists, by an order entered into the minutes, shall select one director to act as chair pro tempore, who, while so acting, shall have all the authority of the chair.
All meetings of the board and any standing committees shall be conducted in a manner prescribed by the Ralph M. Brown Act (Chapter 9 (commencing with Section 54950) of Part 1 of Division 2 of Title 5 of the Government Code).
A majority of the board or of a standing committee entitled to vote constitutes a quorum for the transaction of business. All official acts of the board or a standing subcommittee of the board require the affirmative vote of a majority of the board or committee members present.
The acts of the board shall be expressed by motion, resolution, or ordinance.
CHAPTER 5. Powers of the District [107015. - 107022.]
The district shall have the power to own, operate, manage, and maintain a public transit system and associated facilities, and, in the exercise of the power under this part, the district is authorized in its own name to do all of the following:
Adopt a seal and alter it at its pleasure.
Enact ordinances, resolutions, policies, and guidelines.
Employ agents and employees and contract for professional services.
Make and enter into contracts and enter into stipulations of any nature whatsoever and do all acts necessary and convenient for the full exercise of the powers granted in this part for the operation of the district and transit services and facilities.
Acquire, convey, construct, manage, maintain, and operate buildings and improvements, equipment, and assets of the district.
Acquire, convey, and dispose of real and personal property, easements, and licenses.
Adopt a conflict-of-interest code.
Lease and sublease real and personal property, equipment, and facilities.
Create and administer funds and the distribution of those funds.
Create and enact taxes, fees, fares, and penalties, as permitted by law.
Advocate on behalf of the district.
Develop and pursue ballot measures.
Enforce criminally or civilly, as applicable, any and all ordinances, resolutions, and policies as permitted by law.
Create standing and ad hoc committees, as deemed necessary.
Incur and encumber debts, obligations, and liabilities, including, but not limited to, bonds, notes, warrants, and other forms of indebtedness. However, the debts, obligations, and liabilities incurred by the district shall not be, nor shall they be deemed to be, debts, encumbrances, obligations, or liabilities of any member.
Invest money in the district treasury that is not needed for immediate necessities, as the board determines advisable, in the same manner and upon the same conditions as other local entities in accordance with Section 53601 of the Government Code.
Pursue collection of obligations owed to the district.
Sue and be sued, except as otherwise provided by law, in all actions and proceedings, in all courts and tribunals of competent jurisdiction.
Exercise the right and power of eminent domain to take any property necessary or convenient to the exercise of the powers granted in this part.
Subject to applicable law, provide transportation services or facilities outside the district’s jurisdictional boundaries provided a finding is made by the board that those services or facilities benefit the citizens or users of the transportation service or facilities.
Do and undertake any and all other acts reasonable and necessary to carry out the purposes of this part.
The district shall provide, operate, manage, and maintain a public transportation service serving and connecting the territories of the members. Within the district’s capabilities, as determined by the board, service may also be provided to points outside the territories of the members, with the prior approval of the nonmember city having jurisdiction of the territory to be served. Within the district’s capabilities, expanded transportation services, routes, and facilities may also be provided. If the district proposes to provide expanded services that would serve the area of interest surrounding a nonmember city, as defined by the Ventura County Local Agency Formation Commission, the district shall provide at least 90 days’ prior written notice to that city of the proposed service and thereafter shall make a reasonable effort to meet and confer with officials from that city regarding the proposed service before commencement of the service.
The district shall provide a standardized system of fares and a uniform system of transfers. Except as otherwise provided in paragraph (2), changes in fares and changes in routes shall be made only following a public hearing on the proposed change, with detailed notice made to the governing bodies of the members and the public at least 30 days prior to the proposed public hearing.
Implementation of minor changes in routes and times may be made without notice and hearing by the board. Those minor changes may be implemented by the general manager without notice and hearing under guidelines established by the board, if the district has the equipment to make the minor changes without reduction of its existing services elsewhere and the changes do not result in additional costs to the district or the members. The term “minor change” means less than 20 percent of the miles or hours of a route.
In the performance of its operations, the district shall seek out and make maximum use of all available programs of assistance, may apply for and receive public and private grants that promote the operation of the district, and shall establish and maintain close liaison with federal, state, and regional agencies.
The district may either operate the transit system itself or a part thereof or it may contract with any other public or private agency or corporation to operate all or part of the transit system for the district or it may contract with any public or private agency or corporation for the improvement in transit services, facilities, equipment, or operations being operated and conducted by that agency or corporation in, or out of, the district, as permitted by law.
In the performance of its operations, the district shall do all of the following:
Keep and maintain records and books of accounts in accordance with the uniform system of accounts and records adopted by the Controller pursuant to Section 99243 of the Public Utilities Code.
Provide for and submit to an annual independent audit of its total operations. A copy of each audit report shall be filed with the finance officer of each of the member agencies not later than 120 days following the close of each fiscal year.
Consider and, following a public hearing, adopt an annual operating and capital expenditure budget and a five-year capital expenditure program, in compliance with the requirements of local, state, and federal laws.
Provide for insurance coverage of liability, operations, and assets.
Provide for district employee retirement benefits under the program administered by the California Public Employees’ Retirement System or other system permitted by law.
The district fiscal year shall be July 1 through June 30.
Notice of the time and place of a public hearing on the adoption of the annual budget shall be published pursuant to Section 6061 of the Government Code not less than 15 days prior to the day of the hearing. The proposed annual budget shall be available for public inspection at least 15 days prior to the hearing. Copies of the proposed annual budget and the capital expenditure program shall be submitted to the governing bodies of the member agencies for review and comment at least 30 days prior to the date scheduled for public hearing and final adoption.
The district may, with the concurrence of a majority of the board, cause to be submitted to voters of the district a ballot measure for the imposition of taxes.
If approved as required by law, the district may impose and administer fees and other funding sources secured for transportation system operation, maintenance, and improvement.
The board may set fares for public transit service by resolution.
As an alternative procedure for the raising of funds, the district may issue bonds, payable from revenues of any facility or enterprise to be acquired or constructed by the district, in the manner provided by the Revenue Bond Law of 1941 (Chapter 6 (commencing with Section 54300) of Part 1 of Division 2 of Title 5 of the Government Code), all of the provisions of which are applicable to the district.
The district is a local agency within the meaning of the Revenue Bond Law of 1941 (Chapter 6 (commencing with Section 54300) of Part 1 of Division 2 of Title 5 of the Government Code). The term “enterprise” as used in the Revenue Bond Law of 1941 shall, for all purposes of this part, include transit facilities and any and all parts thereof and all additions, extensions, and improvements thereto and all other facilities authorized acquired, constructed, or completed by the district. The district may issue revenue bonds under the Revenue Bond Law of 1941, for any one or more facilities or enterprises authorized to be acquired, constructed, or completed by the district, or, in the alternative, may issue revenue bonds under the Revenue Bond Law of 1941, for the acquisition, construction, and completion of any one of those facilities. Nothing in this part shall prevent the district from availing itself of, or making use of, any procedure provided in this part for the issuance of bonds of any type or character for any of the facilities or works authorized under this part, and all proceedings may be carried out simultaneously or, in the alternative, as the directors may determine.
The district may advocate on and act on behalf of all members with their concurrence to further the district’s transit interests, funding, projects, and priorities.
The district may promulgate a plan for funding transit projects or operations within its jurisdiction or as permitted in subdivision (t) of Section 107015.
In the performance of its operations, the district shall comply with Title VI of the Civil Rights Act of 1964 (Public Law 88-352) and all requirements imposed by the Federal Transit Administration. The district’s operations shall be performed in accordance with Title VI of that act to the end that no person in the United States shall, on the ground of race, color, or national origin, be excluded from participation in, be denied the benefits of, or otherwise be subjected to discrimination under the district’s operations.
The district may hire an independent staff of its own or contract with any department or agency of the United States or with any public or private entity to implement this part.
The district may contract with public or private entities in conformance with applicable procurement procedures for the procurement of engineering, project management, and contract management services.
The board shall fix the compensation of the district’s officers and employees.
The district may employ employees and agents as the board may deem necessary to carry out its powers and duties, including, but not limited to, a general manager and legal counsel. The general manager and legal counsel shall be selected by, and shall serve at the pleasure of, and upon the terms prescribed by, the board.
The general manager, and every officer or person under the direction of the general manager who handles, has access to, or has charge of any property of the district, shall provide and file with the general manager an official fidelity bond or insurance policy assuring to the district that person’s performance. The board shall determine and establish the penal sum of each official bond. Premiums charged for each bond required shall be paid by the district.
The members, whether individually or collectively, shall not be liable for any act or omission of the district, including, but not limited to, any of the following:
Performing any and all things necessary to carry out the purposes of this part.
Any act of the district, or for any act of the district’s agents or employees.
The payment of wages, benefits, or other compensation to officers, agents, or employees of the district.
The payment of workers’ compensation or indemnity to agents or employees of the district for injury, illness, or death.
CHAPTER 6. Claims [107023. - 107023.]
All claims for money or damages against the district are governed by Division 3.6 (commencing with Section 810) of Title 1 of the Government Code, except as provided therein or by other statutes or regulations expressly applicable thereto.
No claim for money or damages shall be considered by the board unless the claim conforms to the provisions of Chapter 2 (commencing with Section 910) of Division 3.6 of Title 1 of the Government Code and unless the claim is filed with the clerk of the board not less than five days prior to the time of the meeting of the board at which it is to be considered.
Pursuant to Section 935 of the Government Code, all claims against the district for money or damages that are excepted by Section 905 of the Government Code from the provisions of Division 3.6 (commencing with Section 810) of Title 1 of the Government Code, and which are not governed by any other statutes or regulations expressly relating thereto, shall be governed by the procedures prescribed in this section, as follows:
A signed written claim shall be presented to the district by mailing or delivering it to the clerk of the board by the claimant or by a person acting on behalf of the claimant. The claim shall conform to the requirements of Section 910 of the Government Code or be on a form provided by the district.
Unless otherwise provided in this section, the procedures of presentation, consideration, and action upon all claims filed pursuant to this section shall be the same as the procedures provided and required by Sections 910 to 915.2, inclusive, of the Government Code, and any amendment thereto as enacted, which provisions and sections are hereby adopted as the requirements of this section. The presentation and action on claims provided herein shall be a prerequisite to a suit thereon, and the suit shall be subject to the provisions of Sections 945.5 and 945.6 of the Government Code.
CHAPTER 7. Detachments [107024. - 107024.]
Territory within the district may be detached from the district by a supermajority vote of the directors, which shall be at least 80 percent of the nonweighted vote of the existing board provided that all pending legal and financial obligations have been satisfied.
The detachment of territory from the district shall become effective upon giving of the notice required in Section 57204 of the Government Code, provided that the detached territory shall not be relieved from liability for taxation for the payment of any bonded indebtedness existing at the time of detachment.
Notice of the detachment of territory from the district shall be given to each assessor whose roll is used for a tax levy made pursuant to this part and with the State Board of Equalization pursuant to Chapter 8 (commencing with Section 54900) of Part 1 of Division 2 of Title 5 of the Government Code.
CHAPTER 8. Dissolution [107025. - 107025.]
The district may be dissolved upon a supermajority vote of the directors which shall be at least 80 percent of the nonweighted vote of the board. However, the winding up of the district shall be conducted by the board and the general manager. The district shall not be fully dissolved and terminated until all debts, financial obligations, and liabilities are paid in full and any and all remaining assets after payment of all debts, financial obligations, and liabilities are distributed to the members.
If the directors cannot agree as to the valuation of the property or to the manner of asset distribution, the question shall be submitted to arbitration, as set forth below, and the directors shall make the distribution or valuation as directed by arbitrators.
Three arbitrators shall be appointed. One arbitrator shall be selected by the governing bodies of the Cities of Oxnard and San Buenaventura, one arbitrator shall be selected by the governing bodies of the County of Ventura, the City of Port Hueneme, and the City of Ojai, and one arbitrator shall be selected by the governing bodies of the other members. If no other members exist, the third arbitrator shall be selected by the Presiding Judge of the Ventura County Superior Court.
The arbitration shall be binding and shall be conducted pursuant to Title 9 (commencing with Section 1280) of the Code of Civil Procedure. Any hearings shall be held within the county. All notices, including notices under Section 1290.4 of the Code of Civil Procedure shall be given to the governing body of each member.
DIVISION 11. TRANSIT DEVELOPMENT BOARDS [120000. - 120702.]
CHAPTER 1. General Provisions and Definitions [120000. - 120001.]
This division shall be known and may be cited as the Mills-Deddeh Transit Development Act.
As used in this division, “board” means a county transit development board created pursuant to Chapter 2 (commencing with Section 120050).
CHAPTER 2. Creation of Boards [120050. - 120054.]
There is hereby established the San Diego Metropolitan Transit Development Board in that portion of the County of San Diego as described in Section 120054.
The board shall also be known as the San Diego Metropolitan Transit System. Any reference in law to the board shall be construed to include a reference to the San Diego Metropolitan Transit System.
The board shall be considered a rapid transit district for the purposes set forth in Article 5 (commencing with Section 53090) of Chapter 1 of Part 1 of Division 2 of Title 5 of the Government Code.
The board shall be included within the meaning of “public agency,” as defined in Section 1450 of the Streets and Highways Code.
The board consists of 15 members selected as follows:
One member of the County of San Diego Board of Supervisors, appointed by the board of supervisors.
One member of each city council appointed individually by the city councils of the Cities of Coronado, El Cajon, Imperial Beach, La Mesa, Lemon Grove, National City, Poway, and Santee.
Four members of the City Council of the City of San Diego, one of whom shall be the mayor, and two members of the City Council of the City of Chula Vista, one of whom shall be the mayor, each appointed by their respective city council.
The chairperson of the board shall be selected by a two-thirds vote of the board, a quorum being present. The chairperson shall serve for a term of two years, except that he or she is subject to removal at any time by a two-thirds vote of the board, a quorum being present.
The member of the board of supervisors appointed pursuant to subdivision (a) of Section 120050.2 shall represent one of the two supervisorial districts with the greatest percentage of its area within the incorporated area of the County of San Diego within the area under the jurisdiction of the transit development board as defined in Section 120054.
The alternate members of the board shall be appointed as follows:
The County of San Diego Board of Supervisors shall appoint a county supervisor, not already appointed under Section 120051, who represents one of the two supervisorial districts with the greatest percentage of its area within the incorporated area of the County of San Diego within the area under the jurisdiction of the transit development board as defined in Section 120054, to serve as an alternate member of the transit development board.
The city councils of the cities specified in subdivision (b) or (c) of Section 120050.2 shall each individually appoint a member of their respective city councils not already appointed pursuant to subdivision (b) or (c) of Section 120050.2 to serve as an alternate member of the transit development board for each member of the city on the board.
At its discretion, a city council or the county board of supervisors may appoint a second alternate member, in the same manner as first alternates are appointed, to serve on the board in the event that neither a member nor the alternate member is able to attend a meeting of the board.
An alternate member and second alternate member shall be subject to the same restrictions and shall have the same powers, when serving on the board, as a member.
The area of the board shall consist of all of the following:
The Cities of Chula Vista, Coronado, El Cajon, Imperial Beach, La Mesa, Lemon Grove, National City, Poway, San Diego, and Santee.
All of the unincorporated area of the County of San Diego, except as otherwise included within the North San Diego County Transit Development Board in Section 125052.
All the unincorporated area of the County of San Diego surrounded by the cities specified in subdivisions (a) and (b).
CHAPTER 3. Administration [120100. - 120109.]
The board at its first meeting, and thereafter annually at the first meeting in January, shall elect a vice chair who shall preside in the absence of the chair. In the event of the absence or inability to act by the chair or vice chair, the chair pro tempore shall preside.
The board shall establish rules for its proceedings.
A majority of the members of the board constitutes a quorum for the transaction of business. All official acts of the board require the affirmative vote of the majority of the members of the board present. However, after a vote of the members is taken, a weighted vote may be called by the members of any two jurisdictions.
In the case of a weighted vote, the County of San Diego and each city shall, in total, exercise 100 votes to be apportioned annually based on population, except in the case of the City of San Diego. Each of the four representatives of the City of San Diego shall exercise 1212 weighted votes, for a total of 50 votes. The representatives for the City of Chula Vista shall split the votes allocated to that city evenly among its representatives.
Approval under the weighted vote procedure requires the vote of the representatives of not less than three jurisdictions representing not less than 51 percent of the total weighted vote to supersede the original action of the board.
If a weighted vote is taken on any item that requires more than a majority vote of the board, it shall also require the supermajority percentage of the weighted vote.
For purposes of subdivision (b), the population of the County of San Diego is the population in the unincorporated area of the county within the area of jurisdiction of the transit development board pursuant to Section 120054.
The board shall adopt a policy and procedure to implement this section.
The acts of the board shall be expressed by motion, resolution, or ordinance.
All meetings of the board shall be conducted in the manner prescribed by the Ralph M. Brown Act (Chapter 9 (commencing with Section 54950), Part 1, Division 2, Title 5 of the Government Code).
The board shall perform the following duties:
Determine whether to operate exclusive public mass transit guideways or to let contracts for their operation in conformity with state labor laws and subdivision (d) of Section 120508.
Determine the means to finance the operation of public mass transit guideways.
Adopt an annual budget and fix the compensation of its officers and employees.
Adopt an administrative code, by ordinance, that shall prescribe the powers and duties of board officers, the method of appointment of board employees, and methods, procedures, and systems of operation and management of the board. The administrative code shall also provide for, among other things, the appointment of a general manager or chief executive officer, and the organization of the employees of the board into units for finance and administration, planning and operations, property acquisition and management, and community relations, and other units as the board deems necessary.
Cause a postaudit of the financial transactions and records of the board to be made at least annually by a certified public accountant.
Adopt all ordinances and make all rules and regulations proper or necessary to regulate the use, operation, and maintenance of its property and facilities, including its public transit systems and related transportation facilities and services operating within its area of jurisdiction, and to carry into effect the powers granted to the board.
Appoint such advisory commissions as it deems necessary.
Do any and all things necessary to carry out the purposes of this division.
The board shall appoint a general manager or chief executive officer with experience in the management, planning, and development of urban mass transportation systems.
Notice of time and place of the public hearing for the adoption of the annual budget shall be published pursuant to Section 6061 of the Government Code, and shall be published not later than the 15th day prior to the date of the hearing.
The proposed annual budget shall be available for public inspection at least 15 days prior to the hearing.
Each member of the board, including alternate members appointed pursuant to Section 120051.6 when serving in the absence of a regular member, shall be compensated for each day the member attends meetings of the board and committees of the board, not to exceed six committee meetings in any one quarter, and for his or her necessary and reasonable expenses in performing his or her duties as a board member.
In addition, the board may, by resolution, authorize and designate members and alternates to be compensated for representing the board by attendance at specified meetings of other governmental entities and public agencies.
The board shall, by ordinance, after a public hearing, fix the amounts of compensation payable pursuant to subdivisions (a) and (b).
The board shall maintain accounting records and shall report accounting transactions in accordance with generally accepted accounting principles as adopted by the Government Accounting Standards Board (GASB) of the Financial Accounting Foundation for both public reporting purposes and for reporting of activities to the Controller. The activities of any nonprofit corporation or other legal entity wholly owned or controlled by the board and operating a public transit system shall be reported separately in the board’s annual report to the Controller.
The clerk of the board shall cause a proposed ordinance or proposed amendment to an ordinance, and any ordinance adopted by the board, to be published at least once, in a newspaper of general circulation published and circulated in the board’s area of jurisdiction.
The publication of an ordinance, as required by subdivision (a), may be satisfied by either of the following actions:
The board may publish a summary of a proposed ordinance or proposed amendment to an ordinance. The summary shall be prepared by a person designated by the board. The summary shall be published and a certified copy of the full text of the proposed ordinance or proposed amendment shall be posted in the office of the clerk of the board at least five days prior to the board meeting at which the proposed ordinance or amendment is to be adopted. Within 15 days after adoption of the ordinance or amendment, the board shall publish a summary of the ordinance or amendment with the names of those board members voting for and against the ordinance or amendment and the clerk shall post in the office of the clerk a certified copy of the full text of the adopted ordinance or amendment along with the names of those board members voting for and against the ordinance or amendment.
If the person designated by the board determines that it is not feasible to prepare a fair and adequate summary of the proposed ordinance or amendment, and if the board so orders, a display advertisement of at least one-quarter of a page in a newspaper of general circulation in the board’s area of jurisdiction shall be published at least five days prior to the board meeting at which the proposed ordinance or amendment is to be adopted. Within 15 days after adoption of the ordinance or amendment, a display advertisement of at least one-quarter of a page shall be published. The advertisement shall indicate the general nature of, and provide information regarding, the adopted ordinance or amendment, including information sufficient to enable the public to obtain copies of the complete text of the ordinance or amendment, and the names of those board members voting for and against the ordinance or amendment.
CHAPTER 4. Powers and Functions [120200. - 120488.]
ARTICLE 1. Corporate Powers [120200. - 120202.]
The board has perpetual succession and may adopt a seal and alter it at its pleasure.
The board may sue and be sued, except as otherwise provided by law, in all actions and proceedings, in all courts and tribunals of competent jurisdiction.
All of the privileges, immunities from liability, and exemptions from laws, ordinances, and rules, and all pension, relief, disability, workers’ compensation, and other benefits that apply to the activity of officers, agents, or employees of a public agency when performing their respective functions shall apply to employees of the board, and to any nonprofit public benefit corporation of which the board is the sole member.
All claims for money or damages against the board or its employees, and against any nonprofit public benefit corporation of which the board is the sole member or the employees of that corporation, shall be governed by Part 1 (commencing with Section 810), Part 2 (commencing with Section 814), Part 3 (commencing with Section 900), and Part 4 (commencing with Section 940) of Division 3.6 of Title 1 of the Government Code applicable to public agencies and their employees, or by other statutes or regulations expressly applicable thereto.
ARTICLE 2. Contracts [120220. - 120228.]
The board may make contracts and enter into stipulations of any nature whatsoever, either in connection with eminent domain proceedings or otherwise, including, without limiting the generality of the foregoing, contracts and stipulations to indemnify and save harmless, to employ labor, and to do all acts necessary and convenient for the full exercise of the powers granted in this division.
The board may provide and maintain by contract with a public agency or by other means, a security force to enforce its regulations, to preserve and protect any public transit system or project financed pursuant to this division, and to preserve and protect the public peace, health, and safety with respect to its system or projects. Alternatively, the board may contract with a private patrol operator licensed pursuant to Chapter 11.5 (commencing with Section 7580) of Division 3 of the Business and Professions Code, with the county sheriff and municipal police departments within the areas described in Section 120054, and with other transit development boards for security, police, and related services.
The board may contract with any department or agency of the United States of America, with any public agency, or with any person upon such terms and conditions as the board finds is in its best interest.
The board shall not enter into a construction contract over one million dollars ($1,000,000) with any entity unless the entity provides to the board an enforceable commitment that the entity and its subcontractors at every tier will use a skilled and trained workforce to perform all work on the project or a contract that falls within an apprenticeship occupation in the building and construction trades in accordance with Chapter 2.9 (commencing with Section 2600) of Part 1 of Division 2 of the Public Contract Code.
This subdivision shall not apply if any of the following requirements are met:
The board has entered into a project labor agreement that will bind all contractors and subcontractors performing work on the project or the board has contracted to use a skilled and trained workforce and the entity has agreed to be bound by that project labor agreement.
The project or contract is being performed under the extension or renewal of a project labor agreement that was entered into by the board before January 1, 2017.
The entity has entered into a project labor agreement that will bind the entity and all its subcontractors at every tier performing the project or the entity has contracted to use a skilled and trained workforce.
For purposes of subdivision (a), “project labor agreement” has the same meaning as defined in paragraph (1) of subdivision (b) of Section 2500 of the Public Contract Code.
The Legislature finds and declares that a compelling interest exists in ensuring that all federal, state, local, and private funds available to the board are captured and used in a timely manner. In order to maximize the use of federal, state, local, and private funds and to maintain a competitive posture in seeking supplemental federal funds, the board may establish and use a flexible contracting process to maximize its efficient use of public funds.
Except in cases when an article of a specified brand or trade name is the only article that will properly meet the needs of the board or in an emergency declared by the vote of two-thirds of the membership of the board, all contracts for the acquisition or lease of materials, supplies, or equipment in an amount of one hundred fifty thousand dollars ($150,000), or in excess of that amount as authorized by the board, shall be made or entered into with the lowest responsible bidder meeting specifications. For purposes of determining the lowest bid, the amount of sales tax shall be excluded from the total amount of the bid. When the expected purchase amount of the contract equals or exceeds five thousand dollars ($5,000) and is less than one hundred fifty thousand dollars ($150,000), the board shall seek a minimum of three quotations, either written or oral, to permit comparison of prices and other terms.
Except in cases of an emergency declared by the vote of two-thirds of the membership of the board, the board shall for all contracts for the acquisition of services that exceed one hundred fifty thousand dollars ($150,000), that will not be performed by an entity described in Section 120221.5, and that are not within a category of services defined in Section 4525 of the Government Code, solicit bids in writing and award the contract in a competitive procurement process that is in the best interest of the board, including, but not limited to, a negotiated procurement that may evaluate price as a consideration. When the expected amount of the service contract equals or exceeds five thousand dollars ($5,000) and does not exceed one hundred fifty thousand dollars ($150,000), the board shall seek a minimum of three quotations, either written or oral, to permit comparison of prices and other terms.
The board shall award contracts for architectural, landscape architectural, engineering, environmental, land surveying, and construction project management services that are in excess of one hundred fifty thousand dollars ($150,000) in accordance with Chapter 10 (commencing with Section 4525) of Division 5 of Title 1 of the Government Code.
Notwithstanding this chapter, the board may use any procurement method authorized for state or local agencies under state or federal law, including, but not limited to, a competitive negotiation process in accordance with the provisions of Article 7.5 (commencing with Section 20216) of Chapter 1 of Part 3 of Division 2 of the Public Contract Code. The board shall maintain acquisition and contracting guidelines and comply with those guidelines in the procurement of all goods and services.
Provisions in any federally funded contract concerning disadvantaged business enterprises that are in accordance with the request for proposals shall not be subject to negotiation with the successful bidder.
If, after rejecting bids received under Section 120222, the board determines and declares by a two-thirds vote of all of its members that, in its opinion, the supplies, equipment, or materials may be purchased at a lower price in the open market, the board may proceed to purchase these supplies, equipment, or materials in the open market without further observance of the provisions regarding contracts, bids, or advertisements.
If, after solicitation of bids under Section 120222, the board determines and declares by a majority vote that it has not received a responsive bid, the board may proceed to purchase the supplies, equipment, or materials in the open market without further observance of the provisions regarding contracts, bids, or advertisements.
Upon determining that immediate remedial measures to avert or alleviate damage to, or to repair or restore damaged or destroyed property of, the board are necessary in order to insure that the facilities of the board are available to serve the transportation needs of the general public or to comply with any state or federal regulation with respect to the operation of public transportation services, and upon determining that available remedial measures, including procurement in compliance with Sections 120222, and 120223, are inadequate, the general manager or chief executive officer may authorize the expenditure of money previously appropriated by the board specifically for the direct purchases of goods and services, without observance of the provisions of those sections.
The general manager or chief executive officer, after the expenditure authorized under subdivision (a) has been made, shall submit to the board a full report explaining the necessity for that action.
Notwithstanding Section 120222 and upon a finding by two-thirds of all members of the board that a purchase in compliance with Sections 120222 and 120223 does not constitute a method of procurement adequate for the operation of board facilities or equipment, the board may direct the procurement of prototype equipment or modifications in an amount sufficient to conduct and evaluate operational testing without further observance of any provisions requiring contracts, bids, or advertisements.
Notwithstanding Section 120222, the board may direct the purchase of any supply, equipment, or materials without observance of any provision requiring contracts, bids, or advertisements upon a finding by two-thirds of all members of the board that there is only a single source of procurement therefor and that the purchase is for the sole purpose of duplicating, repairing, or replacing supply, equipment, or materials that are in use, including upgrades or migrations of proprietary intellectual property.
Protests based on the content of the procurement solicitation shall be filed with the board within 10 calendar days after the procurement solicitation is first advertised. The general manager or the chief executive officer, or the designee of the general manager or chief executive officer, shall issue a written decision on the protest prior to opening of the procurement solicitation. A protest may be renewed by refiling the protest with the board within 15 calendar days after the mailing of the notice of the intent to award.
Any bidder may protest the intent to award on any ground not based upon the content of the procurement solicitation by filing a protest with the board within 15 calendar days after the mailing of the notice of the intent to award.
Any protest shall contain a full and complete written statement specifying in detail the grounds of the protest and the facts supporting the protest. Protestors shall have an opportunity to appear and be heard before the board prior to the opening of the procurement solicitation in the case of protests based on the content of the procurement solicitation, or prior to final award in the case of protests based on other grounds or the renewal of protests based on the content of the procurement solicitation.
The decision of the protest by the board shall be in writing and constitutes a final administrative decision for purposes of judicial review pursuant to Section 1094.6 of the Code of Civil Procedure.
The board may insure against any accident or destruction of the system or any part thereof. The board may also provide insurance as provided in Part 6 (commencing with Section 989), Division 3.6, Title 1 of the Government Code.
The board may contract for the services of independent contractors.
The board and the Board of Administration of the Public Employees’ Retirement System shall enter into a contract, and the board shall make all of its officers and employees members of the system, except as follows:
Members of the board.
Officers and employees excluded pursuant to Section 20492 of the Government Code.
Subject to Section 120260, the board may enter into joint powers agreements to operate exclusive public mass transit guideways.
ARTICLE 3. Property [120240. - 120244.]
The board may take by grant, purchase, devise, or lease, or condemn in proceedings under eminent domain, or otherwise acquire, and hold and enjoy, real and personal property of every kind necessary to the full or convenient exercise of its powers. The board may lease, mortgage, sell, or otherwise dispose of any real or personal property necessary to the full or convenient exercise of its powers.
Whenever a portion of a parcel of real property is to be taken for board purposes and the remainder is to be left in such state or condition as to be of little value to its owner, or to give rise to claims or litigation concerning severance or other damage, the board may acquire the whole parcel and may sell the excess portion or exchange it for other property suitable for board purposes.
The board shall have or exercise the right of eminent domain in the manner provided by law for the condemnation of private property for public use. The board may take any property necessary or convenient to the exercise of the powers granted in this division, whether the property is already devoted to the same use or otherwise. In the proceedings, venue, and trial relative to the exercise of the right, the board has all the rights, powers, and privileges of an incorporated city and all rights, powers, and privileges conferred in this division. The board shall proceed in the name of the board in condemnation proceedings. The board, in exercising such power, shall, in addition to the damages for the taking, injury, or destruction of property, also pay the cost, exclusive of betterment and with credit for salvage value, of removal, reconstruction, or relocation of any structure, railways, mains, pipes, conduits, wires, cables, or poles of any public agency or utility which is required to be moved to a new location. If property is condemned by the board, the board may take possession and use the property in accordance with the provisions of Section 1243.5 of the Code of Civil Procedure.
The Public Utilities Commission of the state shall have and exercise power and jurisdiction to fix just compensation to be paid for the taking of any property of a public utility in eminent domain proceedings brought by the board. No taking or acquisition by the board which would involve the abandonment, removal, relocation, or use of the property of a railroad corporation, as defined in Section 230, shall be permitted, unless the Public Utilities Commission, after a hearing, shall find and determine that the public interest and necessity require the abandonment, removal, relocation, or use of such property and that such taking or acquisition will not unreasonably impair the ability of the railroad corporation involved to provide safe, adequate, economical, and efficient service. The board may commence and maintain such eminent domain proceedings in the Public Utilities Commission or the superior court at its option.
The board is entitled to the benefit of any reservation or grant, in all cases, where any right has been reserved or granted to any public agency to construct or maintain roads, highways, or other crossings over any public or private lands.
ARTICLE 4. Facilities and Services [120260. - 120269.]
The board shall provide input to the San Diego Association of Governments on the planning and construction of exclusive public mass transit guideways in the area under its jurisdiction in conformance with the California Transportation Plan and the regional transportation plan developed pursuant to Chapter 2.5 (commencing with Section 65080) of Division 1 of Title 7 of the Government Code.
Subject to Section 120260, if the board determines that there is a countywide agency capable of operating exclusive public mass transit guideways, the board shall contract with that agency for such operation.
Priority for guideway development shall be given to meeting the transportation needs of areawide corridors of travel. If the transit development board determines that a guideway system intended solely for an activity center is appropriate, the approval of the California Transportation Commission is necessary prior to the use of funds allocated from the State Highway Account in the State Transportation Fund for the guideway system.
The transit development board may acquire, construct, maintain, and operate (or let a contract in conformity with state labor laws and subdivision (d) of Section 120508 to operate) public transit systems and related transportation facilities and services as it deems necessary to carry out the purposes of this division in conformity with, and to the extent provided in, the San Diego Regional Transportation Consolidation Act (Chapter 3 (commencing with Section 132350) of Division 12.7). The various systems, facilities, and services may be administered by the transit development board under the name of the San Diego Metropolitan Transit System.
The board may enter into contracts with any city in the County of San Diego and with the County of San Diego to license or regulate by ordinance any for-hire vehicle services rendered wholly within the city’s corporate limits or within the unincorporated area of the county.
The board shall levy the fees necessary to recover the full cost of licensing and regulating these services.
For purposes of this section, “for-hire vehicle services” means vehicles, other than public transportation vehicles, transporting passengers over public streets for compensation, which includes taxicabs, passenger jitney service, low-speed vehicles, nonemergency medical vehicles to the extent that the commission does not have regulatory authority, charters, and sightseeing vehicles. The term “for-hire vehicle services” does not include any public transportation services operated by the North County Transit District established pursuant to Division 11.5 (commencing with Section 125000).
The board may, by ordinance, regulate vehicle safety and driver qualifications for passenger jitney service operating between cities in the County of San Diego and between a city in the County of San Diego and unincorporated portions of the County of San Diego.
The board shall levy the fees necessary to recover the full cost of regulating these services.
For purposes of this section, the term “passenger jitney service” includes every corporation or person engaged as a common carrier, for compensation, in the ownership, control, operation, or management of a passenger transportation service by motor vehicles of not more than 15-passenger capacity, excluding the driver, that operates between fixed termini and over a regular route and generally on short nonscheduled headways.
The board may enter into cooperative agreements with cities within its area of jurisdiction and with the County of San Diego to establish uniform policies and regulations governing the use of bus passenger loading zones and establishing responsibility and standards for the maintenance of bus loading zones and any associated improvements.
If the board licenses or regulates any for-hire vehicle services, pursuant to Section 120266, or any passenger jitney service, pursuant to Section 120267, and the licensed or regulated service employs, or contracts with, any driver who (1) is not required to be tested for controlled substances and alcohol pursuant to Part 382 (commencing with Section 382.101) of Title 49 of the Code of Federal Regulations, paragraph (3) of subdivision (b) of Section 53075.5 of the Government Code, Section 1032.1 of this code, or Section 34520 of the Vehicle Code, and (2) is not exempted under Section 34520 of the Vehicle Code, the board shall adopt, by ordinance or resolution, a mandatory controlled substance and alcohol testing certification program for those drivers.
The program adopted pursuant to subdivision (a) shall meet substantially the requirements set forth in paragraph (3) of subdivision (b) of Section 53075.5 of the Government Code.
Evidence derived from a positive test result collected pursuant to the program adopted under subdivision (a) shall not be admissible in a criminal prosecution concerning unlawful possession, sale, or distribution of controlled substances.
ARTICLE 5. Transportation Planning [120300. - 120302.]
The San Diego Association of Governments that includes the area of the board shall be responsible for long-term transportation system planning in that area.
The planning shall be directed to, among other things:
Identification of corridors of travel.
Definition of the transportation problems of each corridor.
Definition of the transportation goals for each corridor.
Definition of land use goals, with the concurrence of affected local jurisdiction, to be supported by transportation investment decisions in each corridor.
Recommendation of priority corridors for guideway development.
Recommendation of the mix of alternative transportation modes appropriate for deployment in light of transportation needs and goals for each corridor.
Recommendation of environmental, economic, energy, and social policies that should guide transportation investment decision within corridors.
With respect to the area under its jurisdiction, the board shall be responsible for operational planning, which includes all planning and monitoring necessary for the operation, implementation, modification, and elimination of public transportation services operated by the board.
Notice of the time and place of the public hearing by the board shall be published pursuant to Section 6061 of the Government Code, and shall be published not later than the 15th day prior to the date of the hearing.
The materials for the public hearing shall be available for public inspection at least 15 days prior to the hearing.
ARTICLE 6. Transportation Funding [120350. - 120356.]
The designated recipient for purposes of Chapter 53 (commencing with Section 5301) of Subtitle III of Title 49 of the United States Code shall be the San Diego Association of Governments, and it shall be responsible for allocating federal transit funds to eligible recipients. The board shall prepare the program of projects for transit capital and operating assistance projects in its area of jurisdiction for receipt of federal funds. The San Diego Association of Governments shall allocate the funds to the board to fund its projects. If a dispute regarding the allocation of funds arises between the board and the North San Diego County Transit Development Board, the two boards shall negotiate in good faith to resolve the dispute. If the negotiation does not result in resolving the dispute prior to adoption of the annual regional transportation improvement program, the San Diego Association of Governments shall resolve the dispute and allocate the funds accordingly.
The board may receive any money pursuant to Chapter 53 (commencing with Section 5301) of Subtitle III of Title 49 of the United States Code for mass transit purposes, and reallocate that money for those purposes in accordance with federal law and rules and regulations.
No other public entity within the area of the board’s jurisdiction may file an application for funds for public transportation under Chapter 4 (commencing with Section 99200) of Part 11 of Division 10 of the Public Utilities Code.
The board shall consolidate all available local, state, and federal transit financial resources for public mass transit operators and systems within its jurisdiction and, in coordination with the various operators, shall adopt a policy for annually prioritizing the use of those funds for all of the following:
Services provided pursuant to the Americans with Disabilities Act of 1990 (Public Law 101-336).
Local match requirements for federal and state transit capital grants.
The local and regional service base.
Any additional planning and operation of transit services and development and implementation of capital programs approved by the board.
The board may take all action necessary to obtain funding available pursuant to Chapter 53 (commencing with Section 5301) of Subtitle III of Title 49 of the United States Code.
The board may establish and maintain reserve funds for its planning, procurement, construction, and acquisition programs with moneys received from private and public contributions, donations and assessments, licenses, leases, sales, and rental income, and any other revenues of the board, except revenues received pursuant to Sections 99260, 99275, 99312, 99313, and 99319.
ARTICLE 7. Public Contributions, Grants, Loans, and Contracts Cooperation [120400. - 120400.]
The board may accept contributions, grants, or loans from any public agency or the United States or any department, instrumentality, or agency thereof, for the purpose of financing the planning, acquisition, construction, or operation of public transportation services, and may enter into contracts and cooperate with, and accept cooperation from, any public agency or the United States, or agency thereof, in the planning, acquisition, construction, or operation of any of those public transportation services in accordance with any legislation that Congress or the Legislature of the State of California may have heretofore adopted or may hereafter adopt, under which aid, assistance, and cooperation may be furnished by the United States or any public agency in the planning, acquisition, construction, or operation of any of those public transportation services. The board may do any and all things necessary in order to avail itself of this aid, assistance, and cooperation under any federal or state legislation now or hereafter enacted.
ARTICLE 8. Penalties [120450. - 120452.]
Violation of any ordinance, rule, or regulation enacted by the board relating to the nonpayment of a fare on any transit vehicle or in any transit station owned, controlled, or used by the board shall be an infraction punishable by a fine not exceeding seventy-five dollars ($75), except that a violation by a person, after the second conviction under this section, shall be a misdemeanor punishable by a fine not exceeding five hundred dollars ($500) or by imprisonment in the county jail not exceeding six months, or by both the fine and imprisonment.
No person shall give, either orally or in writing, information to a public officer or employee engaged in the enforcement of the provisions of this article when that person knows that the information is false. A violation of this section is an infraction punishable by a fine not to exceed fifty dollars ($50), except that such a violation by a person, after the second conviction of a violation of this section, shall be a misdemeanor punishable by a fine not to exceed five hundred dollars ($500) or by imprisonment in the county jail not to exceed six months, or by both that fine and imprisonment.
This section is in addition to, and does not supersede or limit, any and all other remedies, civil or criminal.
Violation of any ordinance, rule, or regulation enacted by the board prohibiting unauthorized operation or manipulation of transit facilities owned, controlled, or used by the board, or prohibiting unauthorized tampering or interference with, or loitering in or about, transit facilities owned, controlled, or used by the board, including, but not limited to, transit centers, rail stations, bus shelters, and bus stops on public and private property, is an infraction punishable by a fine not exceeding fifty dollars ($50), except that such a violation by a person, after the first conviction under this section, is a misdemeanor punishable by a fine not exceeding five hundred dollars ($500) or by imprisonment not exceeding six months, or by both that fine and imprisonment.
Violation of any ordinance, rule, or regulation enacted by the board prohibiting the unauthorized entering into, climbing upon, holding onto, or in any manner attaching oneself to vehicles operated upon exclusive public mass transit guideways owned or controlled by the board, is an infraction punishable by a fine not exceeding fifty dollars ($50), except that a violation by a person, after the first conviction under this section, is a misdemeanor punishable by a fine not exceeding five hundred dollars ($500) or by imprisonment in a county jail not exceeding six months, or by both that fine and imprisonment.
ARTICLE 9. Investments [120470. - 120473.]
Subject to any agreement or covenant between the board and the holders of any of its obligations limiting or restricting classes of investments, the board may invest any surplus money in its treasury, including money in any sinking fund, reserve fund, or other fund created or established for the benefit of holders of any outstanding obligations of the board, in any of the following:
Its own bonds.
Treasury notes, certificates of indebtedness, bills, bonds of the United States, or any other evidence of indebtedness secured by the full faith and credit of the United States.
Treasury notes or bonds of this state, or of any public corporation, municipal corporation, public district, or political subdivision within this state which are legal security for the deposit of public funds.
Any investment in which county funds may be placed pursuant to the general laws of the state.
The investment may be made by direct purchase of any issue of the bonds, treasury notes, or obligations, or part thereof, at the original sale or by the subsequent purchase of the bonds, treasury notes, or obligations.
Any bonds, treasury notes, or obligations purchased and held as investments by the board may, from time to time, be sold and the proceeds reinvested in bonds, treasury notes, or obligations as provided in this article.
Sales of any bonds, treasury notes, or obligations purchased and held by the board shall, from time to time, be made in season so that the proceeds may be applied to the purposes for which the money with which the bonds, treasury notes, or obligations were originally purchased was placed in the treasury of the board.
ARTICLE 11. Transactions and Use Tax [120480. - 120488.]
A retail transactions and use tax ordinance applicable to the entirety of, or a portion of, the incorporated and unincorporated territory within the area of the board pursuant to Section 120054 shall be imposed by the board in accordance with Section 120485, the Transactions and Use Tax Law (Part 1.6 (commencing with Section 7251) of Division 2 of the Revenue and Taxation Code), and Section 2 of Article XIII C of the California Constitution. The tax ordinance shall take effect at the close of the polls on the day of election at which the proposition is adopted. The initial collection of the transactions and use tax shall take place in accordance with Section 120483.
If, at any time, the voters do not approve the imposition of the transactions and use tax, this chapter remains in full force and effect. The board may, at any time thereafter, submit the same, or a different, measure to the voters in accordance with this chapter.
The portion of the area of the board to which the tax would apply shall be determined by the board before the electors vote on the measure.
If the tax only applies to a portion of an area of the board, both of the following shall apply:
The incorporated area of each city and of contiguous cities within the area of the board shall be either wholly included within that portion or wholly excluded from that portion. For purposes of this subparagraph, “contiguous cities” means two or more cities with shared borders.
The entire unincorporated area of the board shall either be wholly included within that portion or wholly excluded from that portion.
The board shall not enter into a construction contract over one million dollars ($1,000,000) that would be in part or wholly financed through the tax with any entity unless the entity provides to the board an enforceable commitment that the entity and its subcontractors at every tier will use a skilled and trained workforce to perform all work on the project or a contract that falls within an apprenticeship occupation in the building and construction trades in accordance with Chapter 2.9 (commencing with Section 2600) of Part 1 of Division 2 of the Public Contract Code.
This paragraph shall not apply if any of the following requirements are met:
The board has entered into a project labor agreement that will bind all contractors and subcontractors performing work on the project.
The board has contracted to use a skilled and trained workforce and the entity has agreed to be bound by that project labor agreement.
The project or contract is being performed under the extension or renewal of a project labor agreement that was entered into by the board before January 1, 2019.
The entity has entered into a project labor agreement that will bind the entity and all its subcontractors at every tier performing the project or the entity has contracted to use a skilled and trained workforce.
For purposes of this paragraph, “project labor agreement” has the same meaning as defined in paragraph (1) of subdivision (b) of Section 2500 of the Public Contract Code.
The revenues derived from the tax shall be spent within, or for the benefit of, the portion of the area of the board to which the tax applies, and shall be spent only on transportation and transit infrastructure and services.
Any revenues derived from the tax shall supplement, and not supplant, other transportation revenues available to the portion of the area of the board to which the tax applies.
The board, in the ordinance, shall state the nature of the tax to be imposed, the tax rate or the maximum tax rate, the purposes for which the revenue derived from the tax will be used, the portion of the area of the board to which the tax would apply, and may set a term during which the tax will be imposed. The purposes for which the tax revenues may be used shall be limited to public transit purposes serving the area of jurisdiction of the board, as determined by the board, including the administration of this division and legal actions related thereto. These purposes include expenditures for planning, environmental reviews, engineering and design costs, and related right-of-way acquisition. The ordinance shall contain an expenditure plan that shall include the allocation of revenues for the purposes authorized by this section.
As used in this section, “public transit purposes” includes the public transit responsibilities under the jurisdiction of the board as well as any repair, redesign, or ongoing maintenance of a right-of-way upon which transit is intended to travel, or any bikeway, bicycle path, sidewalk, trail, pedestrian access, or pedestrian accessway.
The county shall conduct an election called by the board pursuant to Section 120480.
The election shall be called and conducted in the same manner as provided by law for the conduct of elections by a county.
A transactions and use tax ordinance adopted pursuant to this article shall be operative on the first day of the first calendar quarter commencing more than 150 days after adoption of the ordinance.
Before the operative date of the ordinance, the board shall contract with the California Department of Tax and Fee Administration to perform all functions incident to the administration and operation of the ordinance. The costs to be covered by the contract may also include services of the types described in Section 7272 of the Revenue and Taxation Code for preparatory work up to the operative date of the ordinance. Any disputes as to the amount of the costs shall be resolved in the same manner as provided in that section.
Notwithstanding Section 7272 of the Revenue and Taxation Code, the maximum amount of preparatory costs incurred may exceed those costs as described in paragraph (1), if the increased amount reflects necessary preparatory costs.
Within 45 days from the date the ordinance is approved by the voters, the board shall provide the California Department of Tax and Fee Administration with a complete alphabetical list of all streets within the affected area under the jurisdiction of the board pursuant to Section 120054, which shall include beginning and ending street numbers, and shall maintain that list on its internet website. The board shall also provide a legal description and a map or plat, that both describe the boundaries of the applicable area of the board pursuant to Section 120054.
The revenues from the taxes imposed pursuant to this article may be allocated by the board for public transit purposes consistent with the applicable regional transportation improvement program and the applicable regional transportation plan.
The board, subject to the approval of the voters within the portion of the county to which the tax would apply, may impose a maximum tax rate of one-half of 1 percent under this article and the Transactions and Use Tax Law (Part 1.6 (commencing with Section 7251) of Division 2 of the Revenue and Taxation Code). The board shall not levy the tax at a rate other than one-half or one-fourth of 1 percent unless specifically authorized by the Legislature.
The board, as part of the ballot proposition to approve the imposition of a retail transactions and use tax, may seek authorization to issue bonds payable from the proceeds of the tax.
Any action or proceeding wherein the validity of the adoption of the retail transactions and use tax ordinance provided for in this article or the issuance of any bonds thereunder or any of the proceedings in relation thereto is contested, questioned, or denied, shall be commenced within six months from the date of the election at which the ordinance is approved; otherwise, the bonds and all proceedings in relation thereto, including the adoption and approval of the ordinance, shall be held to be valid and in every respect legal and incontestable.
The board has no power to impose any tax other than the transactions and use tax imposed upon approval of the voters in accordance with this article.
CHAPTER 5. Personnel [120500. - 120550.]
ARTICLE 1. Employees Relations [120500. - 120509.]
Employees shall have the right to self-organization, to form, join, or assist labor organizations, to bargain collectively through representatives of their own choosing, and to engage in other concerted activities as permitted under the Federal Labor Management Relations Act, 1947, as amended, for the purpose of collective bargaining or other mutual aid or protection.
It is declared to be in the public interest that the board shall not express any preference for one union over another.
Whenever a majority of the employees employed by the board in a unit that is the appropriate unit for collective bargaining indicate a desire to be represented by a labor organization and upon determining as provided in Section 120505, that such labor organization represents the majority of the employees in that appropriate unit, the board shall meet and confer in a good-faith effort to agree on the terms of a written contract with the recognized representatives of such employees governing wages, salaries, hours, working conditions, and benefits, including, but not limited to, health and welfare, sick leave, insurance, or pension or retirement provisions.
In case of a labor dispute over wages, salaries, hours, working conditions, and benefits on the making or maintaining of collective-bargaining agreements and the terms to be included in such agreements, which is not resolved by negotiations in good faith between the board and the labor organization, upon the joint request of both, the board and the labor organization may submit the dispute to the decision of the majority of an arbitration panel.
The arbitration panel shall be composed of one representative of the board, and one representative of the labor organization, and they shall endeavor to agree upon the selection of the third member. If they are unable to agree, the names of five persons experienced in labor arbitration shall be obtained from the State Conciliation Service. The labor organization and the board shall, alternately, strike a name from the list so supplied, and the name remaining, after the labor organization and the board have stricken four names, shall be designated as the third arbitrator. The labor organization and the board shall determine by lot who shall first strike a name from the list. The decision of a majority of the arbitration board shall be final and binding upon the parties thereto. The expenses of arbitration shall be borne equally by the parties. Each party shall bear its own costs.
In the event the board and the representatives of the employees do not agree to submit the dispute to an arbitration panel as provided in Section 120502, the State Conciliation Service may be notified by either party that a labor dispute exists and that there is no agreement to arbitrate.
The service shall determine whether or not the labor dispute may be resolved by the parties and, if not, the issues concerning which the dispute exists. Upon such determination, the service shall certify its findings to the Governor of the State of California who shall, within 10 days of receipt of certification, appoint a factfinding commission consisting of three persons. The commission shall immediately convene and inquire into and investigate the issues involved in the dispute and shall report to the Governor within 30 days of the date of its creation.
After the creation of such commission, and for 30 days after such commission has made its report to the Governor, no change, except by mutual agreement, shall be made by the parties to the controversy in the conditions out of which the labor dispute arose and service to the public shall be provided.
A contract or agreement shall not be made with any labor organization, association, or group that denies membership to, or in any manner discriminates against, any employee on any basis listed in subdivision (a) of Section 12940 of the Government Code, as those bases are defined in Sections 12926 and 12926.1 of the Government Code.
The board shall not discriminate with regard to employment against any person on any basis listed in subdivision (a) of Section 12940 of the Government Code, as those bases are defined in Sections 12926 and 12926.1 of the Government Code, except as otherwise provided in Section 12940 of the Government Code.
If there is a question of whether a labor organization represents a majority of employees or whether the proposed unit is the appropriate unit for collective bargaining, the question shall be submitted to the State Conciliation Service for disposition. The service shall promptly hold a public hearing, after due notice to all interested parties, and shall thereupon determine the unit appropriate for the purposes of collective bargaining. In making such determination and in establishing rules and regulations governing petitions and the conduct of hearings and elections, the service shall be guided by relevant federal law and administrative practice developed under the Labor Management Relations Act, 1947, as amended.
The service shall provide for an election to determine the question of representation and shall certify the results to the parties. Any certification of a labor organization to represent or act for the employees in any collective-bargaining unit shall not be subject to challenge on the grounds that a new substantial question of representation within such collective unit exists until the lapse of one year from the date of certification or the expiration of any collective-bargaining agreement, whichever is later, except that no collective-bargaining agreement shall be construed to be a bar to representation proceedings for a period of more than two years.
The obligation of the board to meet and confer in good faith with the duly certified labor organization and to agree on the terms of a written collective-bargaining agreement with such labor organization covering the wages, hours, working conditions, and benefits of the employees represented by such labor organization in the appropriate unit, and to comply with the terms thereof, shall not be limited or restricted by the provisions of the Government Code or other laws or statutes. The obligations of the board to bargain collectively shall extend to all subjects of collective bargaining which are, or may be, mandatory subjects of collective bargaining with a private employer, including retroactive provisions and benefits for retired employees.
Notwithstanding the provisions of the Government Code, employees of the board may authorize and, upon such authorization, the board may make deductions from wages and salaries of such employees:
Pursuant to a collective-bargaining agreement with a duly designated or certified labor organization for the payment of union dues, fees, or assessments.
For the payment of contributions pursuant to any health and welfare plan or pension or retirement plan.
For any purpose for which deductions may be authorized by employees of any private employer.
This article also applies to the employee relations of employees of a nonprofit entity that operates public mass transit services and that is solely owned by the board. For employee relations regarding these employees, “board,” as used in this article, means the board and the board of directors of the nonprofit entity as the joint employer of the employees.
The board may, at any time in its sole discretion, abolish any nonprofit entity or merge any nonprofit entity with another nonprofit entity or with the board.
Upon abolishing or merging a nonprofit entity pursuant to subdivision (b), the board shall become the sole employer of the employees of the nonprofit entity and shall assume sole responsibility to observe all existing labor contracts established and maintained pursuant to this article.
Except as may be agreed upon through the collective bargaining process, nothing in this section shall prohibit or limit the right of the board to contract with common carriers of persons operating under a franchise, license, or other agreement. Any provision in an existing collective bargaining agreement made applicable to the board in its capacity as a joint employer with a nonprofit entity pursuant to subdivision (a) or sole successor employer pursuant to subdivision (b) that is intended to prohibit or limit the right of a nonprofit entity to contract out covered bargaining unit services to another common carrier of persons shall not be binding upon the board with respect to any contract for services entered into, renewed, or extended by the board prior to January 1, 2004, and thereafter shall apply only to contracts for bargaining unit services covered by an existing collective bargaining agreement assumed by or binding upon the board as a joint employer unless otherwise agreed upon through the collective bargaining process. The amendments to this subdivision made by Chapter 557 of the Statutes of 2005 are intended solely to clarify existing law and shall not be interpreted either to enlarge or contract the board’s right to contract out for public transportation services.
Upon the request of the board, as defined in Section 120508, with the consent of any labor organization acting as the exclusive representative of employees whose collective bargaining rights are subject to Section 120508, the board may enter into a contract to enroll the collectively bargained employees as members of the Public Employees’ Retirement System or another retirement system.
A contract to enroll employees in the Public Employees’ Retirement System shall be subject to the provisions of Part 3 (commencing with Section 20000) of Division 5 of Title 2 of the Government Code.
Employees transferred from any existing retirement system or pension plan to the Public Employees’ Retirement System or any other retirement system by operation of this section shall receive benefits immediately after enrollment in, or transfer to, the system that are at least equal to, or greater than, the benefits the employees would have been entitled to immediately before enrollment in, or transfer to, the system.
ARTICLE 2. Rights of Employees of Existing Facilities [120520. - 120523.]
Whenever the board acquires ownership of existing facilities from a privately or publicly owned corporation or utility, either in proceedings by eminent domain or otherwise and terminates the legal existence of the corporation or utility, and operates the facilities itself, to the extent necessary for operation of facilities, any of the employees whose duties pertain to the facilities acquired who have been employed by the corporation or utility, as the case may be, for at least 75 days shall be appointed to comparable positions by the board without examination. These employees shall be given sick leave, seniority, and vacation credits in accordance with the records of the corporation or other acquired utility, as the case may be. No employee of the former corporation or utility shall suffer any worsening of wages, seniority, pension, vacation, or other benefits as they exist at the time of and by reason of the acquisition.
The board shall assume and observe all existing labor contracts of the former corporation or utility, as the case may be, insofar as they relate to the acquired facilities.
This section applies only to those officers or supervisory employees of the former corporation or utility, as the case may be, as shall be designated by the board.
Whenever the board acquires ownership of existing facilities from a privately or publicly owned corporation or public utility, either in proceedings in eminent domain or otherwise, and terminates the corporation or operates the facilities itself, that has a pension plan in operation, the members and beneficiaries of the pension plan shall continue to have the rights, privileges, benefits, obligations, and status with respect to the plan.
The board shall consider, and take into account, the outstanding obligations and liabilities of the corporation or of the publicly or privately owned public utility, as the case may be, by reason of the pension plan, and may negotiate an allowance in the purchase price of the corporation or the utility for the assumption of those obligations and liabilities when acquiring the corporation or the utility.
Instead of maintaining an existing pension plan applicable to bargaining unit employees of an acquired facility, the board, with the consent of any exclusive collective bargaining representative of employees of an acquired facility whose rights are protected by Section 120520, may enroll the employees in, or transfer them to, the Public Employees’ Retirement System or another retirement system.
A contract to enroll employees in the Public Employees’ Retirement System shall be subject to the provisions of Part 3 (commencing with Section 20000) of Division 5 of Title 2 of the Government Code.
Employees participating in an existing pension plan shall receive benefits immediately after enrollment in, or transfer to, the system that are at least equal to, or greater than, the benefits the employees would have been entitled to immediately before enrollment in, or transfer to, the system.
Whenever the board acquires ownership of existing facilities from a privately or publicly owned corporation or public utility, either in proceedings in eminent domain or otherwise and maintains the corporation or utility, by whatever name, as a separate, legal corporate entity, the board of directors of the corporation or utility shall continue its responsibilities with regard to its employees’ wages, hours, and other terms and conditions of employment, existing labor contracts, and existing pension plans.
Any pension plan maintained by the board pursuant to this division for employees of the board who are members of a unit appropriate for collective bargaining shall be maintained pursuant to a collective bargaining agreement and this section.
The pension plan and the funds of the plan shall be managed and administered by a retirement board composed of equal representation of labor and management. Any deadlock among the members of the board with respect to that management and administration shall be resolved in the manner specified in Section 302 of the federal Labor Management Relations Act, 1947 (29 U.S.C. Sec. 186(c)(5)).
The duties and responsibilities of the retirement board shall be executed in accordance with Section 17 of Article XVI of the California Constitution.
This section does not apply if the board has, pursuant to a collective bargaining agreement, provided membership for the board’s represented employees in the Public Employees’ Retirement System, a retirement system established pursuant to the County Employees Retirement Law of 1937, or a pension trust subject to the Employee Retirement Income Security Act of 1974 (29 U.S.C. Sec. 1001 et seq.).
ARTICLE 3. Employee Protection [120540. - 120550.]
It shall be a condition of the operation of any transit facility owned or controlled by the board that Section 5333 of Title 49 of the United States Code shall be given effect to the extent required by law.
The board may establish and maintain a police force. Those employees of the board appointed by the general manager or chief executive officer to the police force and who are duly sworn are peace officers and are subject to the powers set forth in Section 830.33 of the Penal Code. The board shall adhere to the standards for recruitment and training of peace officers established by the Commission on Peace Officer Standards and Training pursuant to Title 4 (commencing with Section 13500) of Part 4 of the Penal Code.
CHAPTER 6. Bonds and Other Evidences of Indebtedness [120630. - 120702.]
ARTICLE 1. Revenue Bonds [120630. - 120631.]
The board may issue bonds, payable from revenue of any facility or enterprise to be acquired or constructed by, or on behalf of, the board, in the manner provided by the Revenue Bond Law of 1941 (Chapter 6 (commencing with Section 54300) of Part 1 of Division 2 of Title 5 of the Government Code), and all of the provisions of that law are applicable to the board.
The board is a local agency within the meaning of the Revenue Bond Law of 1941 (Chapter 6 (commencing with Section 54300) of Part 1 of Division 2 of Title 5 of the Government Code). The term “enterprise,” as used in the Revenue Bond Law of 1941, for all purposes of this article, includes the transit system or any or all transit facilities and all additions, extensions, and improvements thereto authorized to be acquired, constructed, or completed by the board.
The board may issue revenue bonds under the Revenue Bond Law of 1941 for any one or more transit facilities authorized to be acquired, constructed, or completed by, or on behalf of, the board or, in the alternative, the board may issue revenue bonds under the Revenue Bond Law of 1941 for the acquisition, construction, and completion of any one of those transit facilities.
Nothing in this article prohibits the board from availing itself of, or making use of, any procedure provided in this chapter for the issuance of bonds of any type or character for any of the transit facilities authorized hereunder, and all proceedings may be carried on simultaneously or, in the alternative, as the board may determine.
ARTICLE 2. Equipment Trust Certificates [120650. - 120654.]
The board may purchase transit equipment such as cars, trolley buses, motorbuses, light rail vehicles, or rolling equipment, and may execute agreements, leases, and equipment trust certificates in the forms customarily used by private corporations engaged in the transit business appropriate to effect the purchase and leasing of transit equipment, and may dispose of the equipment trust certificates upon the terms and conditions that the board may deem appropriate.
Payment for transit equipment, or rentals therefor, may be made in installments, and the deferred installments may be evidenced by equipment trust certificates that are or will be legally available to the board. Title to the equipment shall not vest in the board until the equipment trust certificates are paid.
The agreement to purchase or lease may direct the vendor or lessor to sell and assign or lease the rolling equipment to a bank or trust company duly authorized to transact business in the state as trustee for the benefit and security of the equipment trust certificates, and may direct the trustee to deliver the rolling equipment to one or more designated officers of the board and may authorize the board to simultaneously therewith execute and deliver an installment purchase agreement or a lease of the equipment to the board.
The agreements and leases shall be duly acknowledged before a person authorized by law to take acknowledgments of deeds and in the form required for acknowledgment of deeds.
The agreements, leases, and equipment trust certificates shall be authorized by resolution of the board and shall contain covenants, conditions, and provisions which may be deemed necessary or appropriate to insure the payment of the equipment trust certificates from legally available source or sources of funds specified in the certificates.
The covenants, conditions, and provisions of the agreements, leases, and equipment trust certificates shall not conflict with any of the provisions of any trust agreement securing the payment of bonds, notes, or certificates of the board.
An executed copy of each agreement and lease shall be filed in the office of the Secretary of State, who shall be entitled to receive one dollar ($1) for each copy filed.
The filing constitutes notice to any subsequent judgment creditor or any subsequent purchaser.
ARTICLE 3. Improvement Acts and Special Benefit Districts [120670. - 120671.]
The Improvement Act of 1911 (Division 7 (commencing with Section 5000) of the Streets and Highways Code), the Improvement Bond Act of 1915 (Division 10 (commencing with Section 8500) of the Streets and Highways Code), and the Municipal Improvement Act of 1913 (Division 12 (commencing with Section 10000) of the Streets and Highways Code), are applicable to the board.
Chapter 1 (commencing with Section 99000) of Part 11 of Division 10 is applicable to the board.
ARTICLE 4. Temporary Borrowing [120680. - 120681.]
The board may borrow money in accordance with Article 7 (commencing with Section 53820), Article 7.6 (commencing with Section 53850), or Article 7.7 (commencing with Section 53859) of Chapter 4 of Part 1 of Division 2 of Title 5 of the Government Code.
The board may borrow money in anticipation of the sale of bonds which have been authorized to be issued, but which have not been sold and delivered, and may issue negotiable bond anticipation notes therefor and may renew the bond anticipation notes from time to time, but the maximum maturity of any bond anticipation notes, including the renewals thereof, shall not exceed five years from the date of delivery of the original bond anticipation notes.
The bond anticipation notes may be paid from any money of the board available therefor and not otherwise pledged. If not previously otherwise paid, the bond anticipation notes shall be paid from the proceeds of the next sale of the bonds of the board in anticipation of which they were issued. The bond anticipation notes shall not be issued in any amount in excess of the aggregate amount of bonds which the board has been authorized to issue, less the amount of any bonds of the authorized issue previously sold, and also less the amount of other bond anticipation notes therefor issued and then outstanding.
The bond anticipation notes shall be issued and sold in the same manner as the bonds. The bond anticipation notes and the resolution or resolutions authorizing them may contain any provisions, conditions, or limitations which a resolution of the board authorizing the issuance of bonds may contain.
ARTICLE 5. Miscellaneous [120700. - 120702.]
The board may bring an action to determine the validity of any of its bonds, equipment trust certificates, warrants, notes, or other evidences of indebtedness pursuant to Chapter 9 (commencing with Section 860) of Title 10 of Part 2 of the Code of Civil Procedure.
All bonds and other evidences of indebtedness issued by the board under this chapter, and the interest thereon, are free and exempt from all taxation within the state, except for transfer, franchise, inheritance, and estate taxes.
Notwithstanding any other provisions of this division or any other law, the provisions of all ordinances, resolutions, and other proceedings in the issuance by the board of any bonds, bonds with a pledge of revenues, bonds for improvement districts, revenue bonds, equipment trust certificates, notes, or any and all evidences of indebtedness or liability constitute a contract between the board and the holders of the bonds, equipment trust certificates, notes, or evidences of indebtedness or liability, and the provisions thereof are enforceable against the board or any or all of its successors or assigns, by mandamus or any other appropriate suit, action, or proceeding in law or in equity in any court of competent jurisdiction.
Nothing in this division or in any other law shall be held to relieve the board or the territory included within it from any bonded or other debt or liability contracted by the board. Upon dissolution of the board or upon withdrawal of territory therefrom, that territory formerly included within the board, or withdrawn therefrom, shall continue to be liable for the payment of all bonded and other indebtedness or liabilities outstanding at the time of the dissolution or withdrawal as if the board had not been so dissolved or the territory withdrawn therefrom, and it shall be the duty of the successors or assigns to provide for the payment of the bonded and other indebtedness and liabilities.
Except as may be otherwise provided in the proceedings for the authorization, issuance, and sale of any revenue bonds, bonds secured by a pledge of revenues, or bonds for improvement districts secured by a pledge of revenues, revenues of any kind or nature derived from any revenue-producing improvements, works, facilities, or property owned, operated, or controlled by the board shall be pledged, charged, assigned, and have a lien thereon for the payment of the bonds as long as they are outstanding, regardless of any change in ownership, operation, or control of the revenue-producing improvements, works, facilities, or property and it shall, in any later event or events, be the duty of the successors or assigns to continue to maintain and operate the revenue-producing improvements, works, facilities, or property as long as bonds are outstanding.
DIVISION 11.5. NORTH COUNTY TRANSIT DISTRICT [125000. - 125716.]
CHAPTER 1. General Provisions and Definitions [125000. - 125002.]
This part shall be known and may be cited as the “North County Transit District Act.”
As used in this division, “district” means the North County Transit District.
It is the intent of the Legislature to improve existing public transportation coordination. The Legislature recognizes that in order to achieve a unified, coordinated public transportation system within the San Diego region, it may be necessary to form a regionwide transit district at some future time. It is the intent of the Legislature that the North County Transit District shall reserve the right to join and merge with such a regionwide district at such time as it is deemed mutually beneficial by the board and the region as a whole.
CHAPTER 2. Creation of Board [125050. - 125052.]
There is hereby created, in that portion of the County of San Diego as described in Section 125052, the North County Transit District. The district shall be governed by a board of directors. As used in this division, “board” means the board of directors of the district. The board shall consist of members selected as follows:
One member of the San Diego County Board of Supervisors appointed by the board of supervisors, which member shall represent, on the board of supervisors, the largest portion of the area under the jurisdiction of the district.
One member of each of the City Councils of the Cities of Carlsbad, Del Mar, Encinitas, Escondido, Oceanside, San Marcos, Solana Beach, and Vista, and each new city that incorporates within the district boundaries, appointed by the respective city council.
One nonvoting member who shall be a member of the City Council of the City of San Diego.
Each of the governing bodies appointing a member of the board pursuant to Section 125050 shall also appoint one alternate to serve on the board when the member is not available. The alternate shall be subject to the same restrictions and shall have the same powers, when serving on the board, as the member.
The area of jurisdiction of the board shall consist of the following areas:
The Cities of Carlsbad, Del Mar, Encinitas, Escondido, Oceanside, San Marcos, Solana Beach, and Vista and each new city that incorporates within the district boundaries.
Camp Joseph H. Pendleton.
The unincorporated areas of San Diego County lying within census tracts: 170.04 (but excluding that portion lying east of the eastern boundary of the City of San Diego), 171.00, 173.00, 174.01, 174.02, 175.00, 176.00, 177.00, 178.02, 185.02, 185.03, 186.01, 186.02, 188.00, 189.01, 189.02, 190.00, 191.01, 191.02, 192.01, 192.02, 193.00, 194.00, 196.00, 197.00, 198.00, 199.00, 200.01, 200.02, 200.03, 201.01, 201.02, 202.03, 202.05, 203.00, 204.00, 206.02, 207.01, 207.02, and 208.00, as set forth in the 1970 decennial census maps for the State of California on file with the Bureau of the Census, Department of Commerce, Washington, D.C.
CHAPTER 3. Administration [125100. - 125107.]
The board at its first meeting, and thereafter annually at the first meeting in January, shall elect a chairman who shall preside at all meetings, and a vice chairman who shall preside in his absence. In the event of their absence or inability to act, the members present, by an order entered in the minutes, shall select one of their members to act as chairman pro tem, who, while so acting, shall have all of the authority of the chairman.
The board shall establish rules for its proceedings.
A majority of the members of the board constitutes a quorum for the transaction of business. All official acts of the board require the affirmative vote of the majority of the members of the board present. However, after a vote of the members is taken, a weighted vote may be called by any two members.
In the case of a weighted vote, the County of San Diego and each city shall, in total, exercise 100 votes to be apportioned annually based on population.
Approval under the weighted vote procedure requires the vote of the representatives of not less than three jurisdictions representing not less than 51 percent of the total weighted vote to supersede the original action of the board.
When a weighted vote is taken on any item that requires more than a majority vote of the board, it shall also require the supermajority percentage of the weighted vote.
For purposes of subdivision (b), the population of the County of San Diego is the population in the unincorporated area of the county within the area of jurisdiction of the board pursuant to Section 125052.
The board shall adopt a policy and procedure to implement this section.
The acts of the board shall be expressed by motion, resolution, or ordinance.
All meetings of the board shall be conducted in the manner prescribed by the Ralph M. Brown Act (Chapter 9 (commencing with Section 54950), Part 1, Division 2, Title 5 of the Government Code).
The board shall:
Acquire, construct, maintain, and operate (or let a contract to operate) public transit systems and related facilities.
Adopt an annual budget and fix the compensation of the district’s officers and employees.
Adopt an administrative code, by ordinance, that prescribes the powers and duties of district officers, the method of appointment of district employees, and methods, procedures, and systems of operation and management of the district.
Cause a postaudit of the financial transactions and records of the district to be made at least annually by a certified public accountant.
Appoint advisory commissions as it deems necessary.
Do any and all things necessary to carry out the purposes of this division, including, but not limited to, adopting all ordinances and making all rules and regulations proper or necessary to regulate the use, operation, and maintenance of the district’s property and facilities, including its public transit systems and related transportation facilities and services operating within its area of jurisdiction and those areas beyond its jurisdiction served by the district pursuant to contract or memorandum of agreement with another transit agency, and to carry into effect the powers granted to the district.
Notice of time and place of the public hearing for the adoption of the annual budget shall be published pursuant to Section 6061 of the Government Code, and shall be published not later than the 15th day prior to the date of the hearing.
The proposed annual budget shall be available for public inspection at least 15 days prior to the hearing.
Each member of the board, including an alternate member appointed pursuant to Section 125051 when acting on behalf of the member, shall be paid one hundred fifty dollars ($150) for each meeting of the board or other meeting of a governmental entity the member or alternate attends, but not to exceed seven hundred fifty dollars ($750) in any month, and the necessary and reasonable expenses in performing the duties as a board member.
CHAPTER 4. Powers and Functions [125200. - 125488.]
ARTICLE 1. Corporate Powers [125200. - 125202.]
The district has perpetual succession and may adopt a seal and alter it at its pleasure.
The district may sue and be sued, except as otherwise provided by law, in all actions and proceedings, in all courts and tribunals of competent jurisdiction.
All claims for money or damages against the district are governed by Division 3.6 (commencing with Section 810) of Title 1 of the Government Code except as provided therein, or by other statutes or regulations expressly applicable thereto.
ARTICLE 2. Contracts [125220. - 125227.]
The district may make contracts and enter into stipulations of any nature whatsoever, either in connection with eminent domain proceedings or otherwise, including, but not limited to, contracts and stipulations to indemnify and save harmless, to employ labor, to contract with a private patrol operator licensed pursuant to Article 4 (commencing with Section 7583) of Chapter 11.5 of Division 3 of the Business and Professions Code, the county sheriff and municipal police departments within the areas described in Section 125052, and other transit development boards for security, police, and related services, and to do all acts necessary and convenient for the full exercise of the powers granted in this division.
The district may contract with any department or agency of the federal government, any other public agency, or any person upon such terms and conditions as the district finds is in its best interest.
The Legislature finds and declares that a compelling interest exists in ensuring all federal, state, local, and private moneys available to the district are captured and used in a timely manner.
In order to maximize the use of federal, state, local, and private funds, and to maintain a competitive posture in seeking supplemental federal funds, the board may establish and use a flexible contracting process, consistent with this division, to maximize its efficient use of public funds.
For the acquisition or lease of materials, supplies, or equipment, except in cases where an item of a specified brand or trade name is the only item that will properly meet the needs of the district or in an emergency declared by the vote of two-thirds of all the members of the board, all contracts shall be awarded as follows:
A contract with an expected cost that equals or exceeds one hundred fifty thousand dollars ($150,000), as authorized by the board, shall be made or entered into with the lowest responsible bidder that meets the specifications. For purposes of determining the lowest bid, the amount of sales tax shall be excluded from the total amount of the bid.
A contract with an expected cost that does not equal or exceed one hundred fifty thousand dollars ($150,000) shall be made or entered into using a district-approved competitive procurement process. When the expected cost of a contract equals or exceeds five thousand dollars ($5,000) and does not equal or exceed one hundred fifty thousand dollars ($150,000), the district shall seek a minimum of three quotations, either written or oral, to permit comparison of prices and other terms.
For the acquisition of services that are not within a category of services described in Section 4525 of the Government Code, except in cases of an emergency declared by a vote of two-thirds of the membership of the board, all contracts shall be awarded as follows:
The board shall award contracts for architectural, landscape architectural, engineering, environmental, and land surveying services, and construction project management services, as those services are described in Section 4525 of the Government Code, in accordance with Chapter 10 (commencing with Section 4525) of Division 5 of Title 1 of the Government Code.
Notwithstanding this chapter, the board may use any approved competitive procurement process authorized for state or local agencies under state or federal law, including, but not limited to, a competitive negotiation process in accordance with Article 7.5 (commencing with Section 20216) of Chapter 1 of Part 3 of Division 2 of the Public Contract Code. The board shall maintain acquisition and contracting guidelines and comply with those guidelines in the procurement of all goods and services.
Provisions that are in a federally funded contract concerning disadvantaged business enterprises and that are in accordance with the request for proposals shall not be subject to negotiation with the successful bidder.
The district shall not enter into a construction contract over one million dollars ($1,000,000) with any entity unless the entity provides to the district an enforceable commitment that the entity and its subcontractors at every tier will use a skilled and trained workforce to perform all work on the project or a contract that falls within an apprenticeship occupation in the building and construction trades in accordance with Chapter 2.9 (commencing with Section 2600) of Part 1 of Division 2 of the Public Contract Code.
This subdivision shall not apply if any of the following requirements are met:
The district has entered into a project labor agreement that will bind all contractors and subcontractors performing work on the project or the district has contracted to use a skilled and trained workforce and the entity has agreed to be bound by that project labor agreement.
The project or contract is being performed under the extension or renewal of a project labor agreement that was entered into by the district before January 1, 2017.
The entity has entered into a project labor agreement that will bind the entity and all its subcontractors at every tier performing the project or the entity has contracted to use a skilled and trained workforce.
For purposes of subdivision (a), “project labor agreement” has the same meaning as defined in paragraph (1) of subdivision (b) of Section 2500 of the Public Contract Code.
If, after rejecting bids received under Section 125222, the board determines and declares by a two-thirds vote of all of its members that, in its opinion, the supplies, equipment, or materials may be purchased at a lower price in the open market, the board may proceed to purchase these supplies, equipment, or materials in the open market without further observance of the provisions regarding contracts, bids, or advertisements.
If, after solicitation of bids under Section 125222, the board determines and declares by a majority vote that it has not received a responsive bid, the board may proceed to purchase the supplies, equipment, or materials in the open market without further complying with any contracting, bidding, or advertising requirements.
Upon determining that an immediate remedial measure to avert or alleviate damage to, or to repair or restore the damaged or destroyed property of, the district is necessary to ensure that the district’s facilities are available to serve the transportation needs of the general public, or to comply with any state or federal regulations with respect to the operation of public transportation services, and upon determining that available remedial measures, including procurement in compliance with Sections 125222 and 125223, are inadequate, the executive director may authorize the expenditure of moneys previously appropriated by the board specifically for the direct purchase of goods and services, without complying with Section 125222 or 125223.
The executive director, after the expenditure authorized under subdivision (a) has been made, shall submit to the board a full report explaining the necessity for that action.
Notwithstanding any other provision of this article, and upon a finding by two-thirds of all members of the board that a purchase in compliance with Sections 125222 and 125223 does not constitute a method of procurement adequate for the operation of the district’s facilities or equipment, the board may direct the procurement of prototype equipment or modifications in an amount sufficient to conduct and evaluate operational testing without further compliance with any contracting, bidding, or advertising requirements.
Notwithstanding Section 125222, the board may direct the purchase of any supplies, equipment, or materials without complying with any contracting, bidding, or advertising requirements upon a finding by two-thirds of all members of the board that there is only a single source of procurement and that the purchase is for the sole purpose of duplicating, repairing, or replacing supplies, equipment, or materials that are in use, including upgrades or migrations of proprietary intellectual property.
Protests based on the content of the procurement solicitation shall be filed with the district within 10 calendar days after the procurement solicitation is first advertised. The executive director, or the designee of the executive director, shall issue a written decision on the protest prior to the opening of the procurement solicitation. A protest may be renewed by refiling the protest with the board within 15 calendar days after the posting of the notice of the intent to award.
Any bidder may protest the intent to award on any ground not based upon the content of the procurement solicitation by filing a protest with the district within 15 calendar days after the posting of the notice of the intent to award. The executive director, or the designee of the executive director, shall issue a written decision on the protest.
Any protest shall contain a full and complete written statement specifying in detail the grounds of the protest and the facts supporting the protest. Protestors shall have an opportunity to appear and be heard before the board prior to the opening of the procurement solicitation in the case of protests based on the content of the procurement solicitation or renewed protests based on the content of the procurement solicitation, or prior to final award in the case of protests based on other grounds.
The decision on the protest by the board shall be in writing and shall constitute a final administrative decision for purposes of judicial review pursuant to Section 1094.6 of the Code of Civil Procedure.
The district may insure against any accident or destruction of the system or any part thereof. The district may also provide insurance as provided in Part 6 (commencing with Section 989) of Division 3.6 of Title 1 of the Government Code.
The district may contract for the services of independent contractors.
ARTICLE 3. Property [125240. - 125241.]
The district may take by grant, purchase, devise, or lease, or condemn in proceedings under eminent domain, or otherwise acquire, and hold and enjoy, real and personal property of every kind within or without its area of jurisdiction necessary to the full or convenient exercise of its powers. The district may lease, mortgage, sell, or otherwise dispose of any real or personal property within or without its area of jurisdiction necessary to the full or convenient exercise of its powers.
The district is entitled to the benefit of any reservation or grant, in all cases, where any right has been reserved or granted to any public agency to construct or maintain roads, highways, or other crossings over any public or private lands.
ARTICLE 4. Transit System [125260. - 125260.]
The district shall plan, construct, and operate (or let a contract to operate) public transit systems in conformance with, and to the extent provided for in, the San Diego Regional Transportation Consolidation Act (Chapter 3 (commencing with Section 132350) of Division 12.7).
ARTICLE 6. Transportation Funding [125350. - 125352.]
The district shall be deemed a provider of services within the area of its jurisdiction for purposes of Section 1604 of Title 49 of the United States Code.
The district shall take all action necessary to obtain the maximum amount of funding available pursuant to Section 1602 of Title 49 of the United States Code.
It is the intent of this section that the district shall file application for funds for public transportation in conformity with, and subject to the limitations set forth in, the San Diego Regional Transportation Consolidation Act (Chapter 3 (commencing with Section 132350) of Division 12.7) under Chapter 4 (commencing with Section 99200) of Part 11 of Division 10.
ARTICLE 7. Public Contributions, Grants, Loans, and Contracts Cooperation [125400. - 125400.]
The district may accept contributions, grants, or loans from any public agency or the United States or any department, instrumentality, or agency thereof, for the purpose of financing the planning, acquisition, construction, or operation of public transit systems, and may enter into contracts and cooperate with, and accept cooperation from, any public agency or the United States, or agency thereof, in the planning, acquisition, construction, or operation of those systems in accordance with any legislation that Congress or the Legislature may have heretofore adopted or may hereafter adopt, under which aid, assistance, and cooperation may be furnished by the United States or any public agency in the planning, acquisition, construction, or operation of those systems. The district may do any and all things necessary in order to avail itself of that aid, assistance, and cooperation under any federal or state legislation now or hereafter enacted.
ARTICLE 8. Transit Enforcement and Penalties [125450. - 125453.]
A violation of any ordinance, rule, or regulation enacted by the board relating to the nonpayment of a fare in any transit facility owned or controlled by the district shall be an infraction punishable by a fine not exceeding seventy-five dollars ($75), except that a violation by a person, after the second conviction under this section, shall be a misdemeanor punishable by a fine not exceeding five hundred dollars ($500) or by imprisonment in a county jail not exceeding six months, or by both that fine and imprisonment.
No person shall give, either orally or in writing, information to a public officer or employee engaged in the enforcement of this article if that person knows that the information is false. A violation of this section is an infraction punishable by a fine not to exceed seventy-five dollars ($75), except that a violation by a person, after a second conviction of a violation of this section, shall be a misdemeanor punishable by a fine not to exceed five hundred dollars ($500) or by imprisonment in the county jail not to exceed six months, or by both the fine and imprisonment.
This section is in addition to, and does not supersede or limit, any and all other remedies, civil or criminal.
A violation of any ordinance, rule, or regulation enacted by the board prohibiting unauthorized operation or manipulation of transit facilities owned or controlled by the board, or prohibiting unauthorized tampering or interference with, or loitering in or about, transit facilities owned or controlled by the board, is an infraction punishable by a fine not exceeding seventy-five dollars ($75), except that a violation by a person, after the first conviction under this section, is a misdemeanor punishable by a fine not exceeding five hundred dollars ($500) or by imprisonment in the county jail not exceeding six months, or by both that fine and imprisonment.
A violation of any ordinance, rule, or regulation enacted by the board prohibiting the unauthorized entering into, climbing upon, holding onto, or in any manner attaching oneself to vehicles operated upon exclusive public mass transit guideways owned or controlled by the board, is an infraction punishable by a fine not exceeding seventy-five dollars ($75), except that a violation by a person, after the first conviction under this section, is a misdemeanor punishable by a fine not exceeding five hundred dollars ($500) or by imprisonment in the county jail not exceeding six months, or by both that fine and imprisonment.
ARTICLE 9. Transactions and Use Tax [125480. - 125488.]
A retail transactions and use tax ordinance applicable to the entirety of, or a portion of, the incorporated and unincorporated territory within the area of the board pursuant to Section 125052 shall be imposed by the board in accordance with Section 125485, the Transactions and Use Tax Law (Part 1.6 (commencing with Section 7251) of Division 2 of the Revenue and Taxation Code), and Section 2 of Article XIII C of the California Constitution. The tax ordinance shall take effect at the close of the polls on the day of election at which the proposition is adopted. The initial collection of the transactions and use tax shall take place in accordance with Section 125483.
If, at any time, the voters do not approve the imposition of the transactions and use tax, this chapter remains in full force and effect. The board may, at any time thereafter, submit the same, or a different, measure to the voters in accordance with this chapter.
The portion of the area of the board to which the tax would apply shall be determined by the board before the electors vote on the measure.
If the tax only applies to a portion of an area of the board, both of the following shall apply:
The incorporated area of each city and of contiguous cities within the area of the board shall be either wholly included within that portion or wholly excluded from that portion. For purposes of this subparagraph, “contiguous cities” means two or more cities with shared borders.
The entire unincorporated area of the board shall either be wholly included within that portion or wholly excluded from that portion.
The board shall not enter into a construction contract over one million dollars ($1,000,000) that would be in part or wholly financed through the tax with any entity unless the entity provides to the board an enforceable commitment that the entity and its subcontractors at every tier will use a skilled and trained workforce to perform all work on the project or a contract that falls within an apprenticeship occupation in the building and construction trades in accordance with Chapter 2.9 (commencing with Section 2600) of Part 1 of Division 2 of the Public Contract Code.
This paragraph shall not apply if any of the following requirements are met:
The board has entered into a project labor agreement that will bind all contractors and subcontractors performing work on the project.
The board has contracted to use a skilled and trained workforce and the entity has agreed to be bound by that project labor agreement.
The project or contract is being performed under the extension or renewal of a project labor agreement that was entered into by the board before January 1, 2019.
The entity has entered into a project labor agreement that will bind the entity and all its subcontractors at every tier performing the project or the entity has contracted to use a skilled and trained workforce.
For purposes of this paragraph, “project labor agreement” has the same meaning as defined in paragraph (1) of subdivision (b) of Section 2500 of the Public Contract Code.
The revenues derived from the tax shall be spent within, or for the benefit of, the portion of the area of the board to which the tax applies, and shall be spent only on transportation and transit infrastructure and services.
Any revenues derived from the tax shall supplement, and not supplant, other transportation revenues available to the portion of the area of the board to which the tax applies.
The board, in the ordinance, shall state the nature of the tax to be imposed, the tax rate or the maximum tax rate, the purposes for which the revenue derived from the tax will be used, the portion of the area of the board to which the tax would apply, and may set a term during which the tax will be imposed. The purposes for which the tax revenues may be used shall be limited to public transit purposes serving the area of jurisdiction of the board, as determined by the board, including the administration of this division and legal actions related thereto. These purposes include expenditures for the planning, environmental reviews, engineering and design costs, and related right-of-way acquisition. The ordinance shall contain an expenditure plan that shall include the allocation of revenues for the purposes authorized by this section.
As used in this section, “public transit purposes” includes the public transit responsibilities under the jurisdiction of the district as well as any repair, redesign, or ongoing maintenance of a right-of-way upon which transit is intended to travel, or any bikeway, bicycle path, sidewalk, trail, pedestrian access, or pedestrian accessway.
The county shall conduct an election called by the board pursuant to Section 125480.
The election shall be called and conducted in the same manner as provided by law for the conduct of elections by a county.
A transactions and use tax ordinance adopted pursuant to this article shall be operative on the first day of the first calendar quarter commencing more than 150 days after adoption of the ordinance.
Before the operative date of the ordinance, the board shall contract with the California Department of Tax and Fee Administration to perform all functions incident to the administration and operation of the ordinance. The costs to be covered by the contract may also include services of the types described in Section 7272 of the Revenue and Taxation Code for preparatory work up to the operative date of the ordinance. Any disputes as to the amount of the costs shall be resolved in the same manner as provided in that section.
Notwithstanding Section 7272 of the Revenue and Taxation Code, the maximum amount of preparatory costs incurred may exceed those costs as described in paragraph (1), if the increased amount reflects necessary preparatory costs.
Within 45 days from the date the ordinance is approved by the voters, the board shall provide the California Department of Tax and Fee Administration with a complete alphabetical list of all streets within the affected area under the jurisdiction of the board pursuant to Section 125052, which shall include beginning and ending street numbers, and shall maintain that list on its internet website. The board shall also provide a legal description and a map or plat, that both describe the boundaries of the applicable area of the board pursuant to Section 125052.
The revenues from the taxes imposed pursuant to this article may be allocated by the board for public transit purposes consistent with the applicable regional transportation improvement program and the applicable regional transportation plan.
The board, subject to the approval of the voters within the portion of the county to which the tax would apply, may impose a maximum tax rate of one-half of 1 percent under this article and the Transactions and Use Tax Law (Part 1.6 (commencing with Section 7251) of Division 2 of the Revenue and Taxation Code). The board shall not levy the tax at a rate other than one-half or one-fourth of 1 percent unless specifically authorized by the Legislature.
The board, as part of the ballot proposition to approve the imposition of a retail transactions and use tax, may seek authorization to issue bonds payable from the proceeds of the tax.
Any action or proceeding wherein the validity of the adoption of the retail transactions and use tax ordinance provided for in this article or the issuance of any bonds thereunder or any of the proceedings in relation thereto is contested, questioned, or denied, shall be commenced within six months from the date of the election at which the ordinance is approved; otherwise, the bonds and all proceedings in relation thereto, including the adoption and approval of the ordinance, shall be held to be valid and in every respect legal and incontestable.
The board has no power to impose any tax other than the transactions and use tax imposed upon approval of the voters in accordance with this article.
CHAPTER 5. Personnel [125500. - 125600.]
ARTICLE 1. Application [125500. - 125500.]
This chapter shall become operative on the date the district first begins to operate a public transit system pursuant to Section 125105.
ARTICLE 2. Employee Relations [125520. - 125527.]
Employees shall have the right to self-organization, to form, join, or assist labor organizations, to bargain collectively through representatives of their own choosing, and to engage in other concerted activities for the purpose of collective bargaining or other mutual aid or protection.
Any question which may arise with respect to whether a majority of employees in an appropriate unit desire to be represented by a labor organization shall be submitted to the Public Employment Relations Board. In resolving those questions of representation, including the determination of the appropriate unit or units, petitions, and the conduct of hearings and elections, the board shall apply the relevant federal law and administrative practice developed under the Labor Management Relations Act, 1947, as amended, and, for this purpose, shall adopt appropriate rules and regulations.
The California State Mediation and Conciliation Service shall administer any rules and regulations and shall provide for a prompt public hearing and secret ballot election to determine the question of representation and shall certify the results to the parties.
Any certification of a labor organization to represent or act for the employees in any collective-bargaining unit shall not be subject to challenge on the grounds that a new substantial question of representation within the collective-bargaining unit exists until the lapse of one year from the date of certification or the expiration of any collective-bargaining agreement, whichever is later, except that no collective-bargaining agreement shall be considered to be a bar to representation proceedings for a period of more than two years.
Whenever a majority of the employees employed by the district in a unit appropriate for collective bargaining indicate a desire to be represented by a labor organization and upon determining, as provided in Section 125521, that the labor organization represents at least a majority of the employees in the appropriate unit, the district and the accredited representative of employees shall bargain in good faith and make all reasonable efforts to reach agreement on the terms of a written contract governing wages, hours, pensions, and working conditions.
A contract or agreement shall not be made with any labor organization, association, or group that denies membership on any basis listed in subdivision (a) of Section 12940 of the Government Code, as those bases are defined in Sections 12926 and 12926.1 of the Government Code. However, the organization may preclude from membership any individual who advocates the overthrow of the government by force or violence.
The district shall not discriminate with regard to employment against any person on any basis listed in subdivision (a) of Section 12940 of the Government Code, as those bases are defined in Sections 12926 and 12926.1 of the Government Code, except as otherwise provided in Section 12940 of the Government Code.
If, after a reasonable period of time, representatives of the district and the accredited representatives of the employees fail to reach agreement on the terms of a written contract governing wages, hours, pensions, and working conditions or the interpretation or application of the terms of an existing contract, either party may request mediation services of the State Conciliation Service.
If, after a reasonable period of time, representatives of the district and the accredited representatives of the employees fail to reach agreement either on the terms of a written contract governing wages, hours, pensions, and working conditions or the interpretation or application of the terms of an existing contract, upon the agreement of both the district and the representatives of the employees, the dispute may be submitted to an arbitration board.
The arbitration board shall be composed of two representatives of the district and two representatives of the labor organization, and they shall endeavor to agree upon the selection of a fifth member. If they are unable to agree, the names of five persons experienced in labor arbitration shall be obtained from the State Conciliation Service. The labor organization and the district shall, alternately, strike a name from the list so supplied, and the name remaining after the labor organization and the district have stricken four names, shall be designated as the fifth arbitrator and the chair of the board of arbitration. The labor organization and the district shall determine by lot who shall first strike a name from the list. The decision of a majority of the arbitration board shall be final and binding upon the parties thereto.
Each party shall be responsible for the expense of the presentation of its case. All other expenses of arbitration shall be borne equally by the parties and the expenses may include the making of a verbatim record of the proceedings and transcript of that record.
If the district and the representatives of the employees do not agree to submit any dispute to arbitration as provided in Section 125525, the State Conciliation Service may be notified by either party that a dispute exists and there is no agreement to arbitrate.
Following that notification, the State Conciliation Service shall determine whether or not the dispute may be resolved by the parties and, if not, the issues concerning which the dispute exists. Upon that determination, the service shall certify its findings to the Governor. The Governor shall, within 10 days of receipt of certification, appoint a factfinding commission consisting of three persons.
The commission shall immediately convene and inquire into and investigate the issues in the dispute. The commission shall have authority to issue subpoenas for the attendance of witnesses and subpoenas duces tecum for the production of books, documents, and other records. Subpoenas shall be served and enforced in accordance with Chapter 2 (commencing with Section 1985) of Title 3 of Part 4 of the Code of Civil Procedure. The commission shall report to the Governor within 30 days of the date of its creation.
After the creation of the commission, and for 30 days after the commission has made its report to the Governor, no change, except by mutual agreement, shall be made by the parties to the controversy in the conditions out of which the dispute arose, and service to the public shall be provided.
If an exclusive collective-bargaining representative is selected pursuant to Section 125521, the provisions of Chapter 10 (commencing with Section 3500) of Division 4 of Title 1 of the Government Code are not applicable to the district.
ARTICLE 3. Rights of Employees of Existing Facilities [125540. - 125541.]
Whenever the district acquires existing facilities from a publicly or privately owned utility, either in proceedings by eminent domain or otherwise, to the extent necessary for operation of facilities, all of the employees of the utility whose duties pertain to the facilities acquired who have been employed by the utility for at least 75 days shall be appointed to comparable positions by the board without examination. These employees shall be given sick leave, seniority, and vacation credits in accordance with the records of the acquired public utility. No employee of any acquired public utility shall suffer any worsening of wages, seniority, pension, vacation, or other benefits by reason of the acquisition.
Whenever the district acquires existing facilities from a publicly or privately owned utility, either in proceedings in eminent domain or otherwise, the district shall assume and observe all existing labor contracts.
The provisions of this section shall apply only to those officers or supervisory employees of the acquired utility as shall be designated by the district.
Whenever the district acquires existing facilities from a publicly or privately owned utility, either in proceedings in eminent domain or otherwise, that has a pension plan in operation, members and beneficiaries of that pension plan shall continue to have the rights, privileges, benefits, obligations and status with respect to that established system. The outstanding obligations and liabilities of that public utility by reason of that pension plan shall be considered and taken into account and allowance made therefor in the purchase price of that public utility. The persons entitled to pension benefits as provided for in this section and the benefits which are provided shall be specified in the agreement or order by which any public utility is acquired by the district.
ARTICLE 4. Pension Plan [125550. - 125552.]
The adoption, terms, and conditions of a pension plan covering employees of the district in a bargaining unit represented by a labor organization shall be pursuant to a collective bargaining agreement between that organization and the district and shall be subject to this section.
The pension plan and the funds of the plan shall be managed and administered by a retirement board composed of equal representation of labor and management. Any deadlock among the members of the board with respect to that management and administration shall be resolved in the manner specified in Section 302 of the federal Labor Management Relations Act, 1947 (29 U.S.C. Sec. 186(c)(5)).
The duties and responsibilities of the retirement board shall be executed in accordance with Section 17 of Article XVI of the California Constitution.
This section does not apply if the district has, pursuant to a collective bargaining agreement, provided membership for the district’s represented employees in the Public Employees’ Retirement System, a retirement system established pursuant to the County Employees Retirement Law of 1937, or a pension trust subject to the Employee Retirement Income Security Act of 1974 (29 U.S.C. Sec. 1001 et seq.).
The district may contract with the Board of Administration of the Public Employees’ Retirement System, and in that case the board of administration shall enter into a contract with the district, to enter all, or any portion, of the employees of the district under that system; provided, that no employees of the district in a bargaining unit that is represented by a labor organization shall be included in the contract except as authorized by a collective-bargaining agreement.
All persons receiving pension benefits from an acquired public utility, and all persons entitled to pension benefits under any pension plan of the acquired public utility, may become members or receive pensions under a pension plan established by the district by mutual agreement of those persons and the district. The agreement may provide for the waiver of all rights, privileges, benefits, and status with respect to the pension plan of the acquired public utility.
ARTICLE 5. Other Benefits [125560. - 125561.]
The district shall take such steps as may be necessary to obtain coverage for the board and its employees under Subchapter II of the Federal Social Security Act, as amended, and the related provisions of the Federal Contributions Act, as amended.
The district shall take such steps as may be necessary to obtain coverage for the board and its employees under the workers’ compensation, unemployment compensation, and disability and unemployment insurance laws of the State of California.
ARTICLE 6. Transit Police Force [125600. - 125600.]
The district may establish and maintain a police force. Those employees of the district appointed by the executive director to the police force and who are duly sworn are peace officers, subject to Section 830.33 of the Penal Code. The district shall comply with the standards for recruitment and training of peace officers established by the Commission on Peace Officer Standards and Training pursuant to Title 4 (commencing with Section 13500) of Part 4 of the Penal Code.
CHAPTER 6. Bonds and Other Evidences of Indebtedness [125700. - 125716.]
The district may issue bonds, payable from revenue of any facility or enterprise to be acquired or constructed by the district, in the manner provided by the Revenue Bond Law of 1941 (Chapter 6 (commencing with Section 54300) of Part 1 of Division 2 of Title 5 of the Government Code), and all of the provisions of that law are applicable to the district.
The district is a local agency within the meaning of the Revenue Bond Law of 1941 (Chapter 6 (commencing with Section 54300) of Part 1 of Division 2 of Title 5 of the Government Code). The term “enterprise,” as used in the Revenue Bond Law of 1941, for all purposes of this chapter, includes the transit system or any or all transit facilities and all additions, extensions, and improvements thereto authorized to be acquired, constructed, or completed by the district.
The district may issue revenue bonds under the Revenue Bond Law of 1941 for any one or more transit facilities authorized to be acquired, constructed, or completed by the district or for transit equipment described in Section 125702 authorized to be acquired by the district or, in the alternative, the district may issue revenue bonds under the Revenue Bond Law of 1941 for the acquisition, construction, and completion of any one of those transit facilities or for transit equipment described in Section 125702 authorized to be acquired by the district.
Nothing in this chapter prohibits the district from availing itself of, or making use of, any procedure provided in this chapter for the issuance of bonds of any type or character for any of the transit facilities authorized hereunder, and all proceedings may be carried on simultaneously or, in the alternative, as the district may determine.
The district may purchase transit equipment such as cars, trolley buses, motorbuses, light rail vehicles, or rolling equipment, and may execute agreements, leases, and equipment trust certificates in the forms customarily used by private corporations engaged in the transit business appropriate to effect the purchase and leasing of transit equipment, and may dispose of the equipment trust certificates upon the terms and conditions that the district may deem appropriate.
Payment for transit equipment, or rentals therefor, may be made in installments, and the deferred installments may be evidenced by equipment trust certificates that are or will be legally available to the district. Title to the equipment may not vest in the district until the equipment trust certificates are paid.
The agreement to purchase or lease transit equipment may direct the vendor or lessor to sell and assign or lease the transit equipment to a bank or trust company duly authorized to transact business in the state as trustee for the benefit and security of the equipment trust certificates, and may direct the trustee to deliver the transit equipment to one or more designated officers of the district and may authorize the district to simultaneously therewith execute and deliver an installment purchase agreement or a lease of that equipment to the district.
The agreements and leases shall be duly acknowledged before a person authorized by law to take acknowledgments of deeds and in the form required for acknowledgment of deeds.
The agreements, leases, and equipment trust certificates shall be authorized by resolution of the board and shall contain covenants, conditions, and provisions that may be deemed necessary or appropriate to insure the payment of the equipment trust certificates from any legally available source or sources of funds as may be specified in the certificates.
The covenants, conditions, and provisions of the agreements, leases, and equipment trust certificates may not conflict with any trust agreement or similar document securing the payment of bonds, notes, or certificates of the district.
An executed copy of each agreement and lease shall be filed in the office of the Secretary of State, for a fee of one dollar ($1) for each copy filed.
The filing constitutes notice to any subsequent judgment creditor or any subsequent purchaser.
The Improvement Act of 1911 (Division 7 (commencing with Section 5000) of the Streets and Highways Code), the Improvement Bond Act of 1915 (Division 10 (commencing with Section 8500) of the Streets and Highways Code), and the Municipal Improvement Act of 1913 (Division 12 (commencing with Section 10000) of the Streets and Highways Code), are applicable to the district.
Chapter 1 (commencing with Section 99000) of Part 11 of Division 10 is applicable to the district.
The district shall be considered a “local agency,” as defined in subdivision (h) of Section 53317 of the Government Code, and the provisions of Chapter 2.5 (commencing with Section 53311) of Part 1 of Division 2 of Title 5 of the Government Code are applicable to the district.
The district shall be considered to be a “local agency” as defined in subdivision (f) of Section 6585 of the Government Code, and Article 4 (commencing with Section 6584) of Chapter 5 of Division 7 of Title 1 of the Government Code is applicable to the district.
The district may borrow money in accordance with Article 7 (commencing with Section 53820), Article 7.6 (commencing with Section 53850), or Article 7.7 (commencing with Section 53859) of Chapter 4 of Part 1 of Division 2 of Title 5 of the Government Code.
The district may borrow money in anticipation of the sale of bonds that have been authorized to be issued, but that have not been sold and delivered, and may issue negotiable bond anticipation notes therefor, and may renew the bond anticipation notes from time to time, but the maximum maturity of any bond application notes, including the renewals thereof, may not exceed five years from the date of delivery of the original bond anticipation notes.
The bond anticipation notes may be paid from any money of the district available therefor and not otherwise pledged. If not previously otherwise paid, the bond anticipation notes shall be paid from the proceeds of the next sale of the bonds of the district in anticipation of which they were issued. The bond anticipation notes may not be issued in any amount in excess of the aggregate amount of bonds that the district has not been authorized to issue, less the amount of any bonds of the authorized issue previously sold, and also less the amount of other bond anticipation notes therefor issued and then outstanding.
The bond anticipation notes shall be issued and sold in the same manner as the bonds. The bond anticipation notes and the resolution or resolutions authorizing them may contain any provisions, conditions, or limitations that a resolution of the board of the district authorizing the issuance of bonds may contain.
The district may issue negotiable promissory notes pursuant to this section to acquire funds for any district purposes. The maturity of the promissory notes may not be later than five years from the date thereof. Those notes shall bear interest at a rate not to exceed 12 percent per year. Those notes shall be payable from any source of revenue available to the district.
The district may bring an action to determine the validity of any of its bonds, equipment trust certificates, warrants, notes, or other evidences of indebtedness pursuant to Chapter 9 (commencing with Section 860) of Title 10 of Part 2 of the Code of Civil Procedure.
All bonds and other evidences of indebtedness issued by the district under this chapter, and the interest thereon, are free and exempt from all taxation within the state, except for transfer, franchise, inheritance, and estate taxes.
Notwithstanding any other provisions of this division or of any other law, the provisions of all ordinances, resolutions, and other proceedings in the issuance by the district of any bonds, bonds with a pledge of revenues, bonds for any and all evidences of indebtedness or liability constitute a contract between the district and the holders of the bonds, equipment trust certificates, notes, or evidences of indebtedness or liability, and the provisions thereof are enforceable against the district or any or all of its successors or assigns, by mandamus or any other appropriate suit, action, or proceeding in law or in equity in any court of competent jurisdiction.
Nothing in this division or in any other law relieves the district or the territory included within it from any bonded or other debt or liability contracted by the district. Upon dissolution of the district or upon withdrawal of territory therefrom, that territory formerly included within the district, or withdrawn therefrom, shall continue to be liable for the payment of all bonded and other indebtedness or liabilities outstanding at the time of the dissolution or withdrawal as if the district had not been so dissolved or the territory withdrawn therefrom, and it shall be the duty of the successors or assigns to provide for the payment of the bonded and other indebtedness and liabilities.
Except as may be otherwise provided in the proceedings for the authorization, issuance, and sale of any revenue bonds, bonds secured by a pledge of revenues, or bonds for improvement districts secured by a pledge of revenues, revenues of any kind or nature derived from any revenue-producing improvements, works, facilities, or property owned, operated, or controlled by the district shall be pledged, charged, assigned, and have a lien thereon for the payment of the bonds as long as they are outstanding, regardless of any change in ownership, operation, or control of the revenue-producing improvements, works, facilities, or property and it shall, in any later event or events, be the duty of the successors or assigns to continue to maintain and operate the revenue-producing improvements, works, facilities, or property as long as bonds are outstanding.
DIVISION 12. COUNTY TRANSPORTATION COMMISSIONS [130000. - 130828.1.]
CHAPTER 1. General Provisions, Findings, and Definitions [130000. - 130010.]
This division shall be known and may be cited as the County Transportation Commissions Act.
The Legislature hereby finds and declares that:
Public demand for an efficient public transportation system in the southern California region resulting from population sprawl, the concentration of many transit dependent citizens in the large urban areas, and increasing mobility requirements indicates a need for improved, as well as more innovative, policy and decisionmaking institutions to resolve these problems.
A basic purpose of transportation policy within the region should be to avoid undesirable duplication of transportation services, achieve the operation of a coordinated and integrated transportation system which will reduce automobile usage and dependency, reduce the consumption of scarce and expensive energy fuels, and reduce the levels of automobile-related air pollution.
Recognizing the scarcity of resources available for all transportation development, the commissions shall give priority to low-cost highway and transit improvements, and shall work toward maximizing the effectiveness of existing resources available to the commissions.
Recognizing the importance of the state highway system in the Los Angeles metropolitan area to bus, automobile, and freight transportation, it is necessary to maintain this highway system at least at its present operating standards and to increase the person-moving capability of this system by such methods as carpooling, improved traffic operations, exclusive busways, and fringe parking facilities.
The transportation system should offer adequate public transportation to all citizens, including those immobilized by poverty, age, physical handicaps, or other reasons.
The cities and local communities acting singly or jointly should be given more responsibilities for designing and providing local transit services to improve the responsiveness of public transit to public needs.
The transportation decisionmaking process should be responsive to public values, and provide for the continuing involvement of the public in the preparation, revision, and discussion of transportation plans and services.
Transportation planning should recognize that transportation systems have significant effect on the physical and socioeconomic characteristics of the areas served, and emphasis should be given to the protection and enhancement of the environment and the restoration of blighted neighborhoods near community centers. Los Angeles County, in particular, is a multicentered area with diverse socioeconomic levels and travel patterns, and a majority of the trips in the county are four miles or less.
As used in this division, “commission” means a county transportation commission created pursuant to Chapter 2 (commencing with Section 130050).
As used in this division, “local transportation zones” means cities or unincorporated areas which contain at least one economic center or major trip generator in which there is a large percentage of short- and medium-length transit trips. Local transportation zones shall be coordinated with regional transit operations as appropriate relative to consumer need and efficient operations.
As used in this division, “multicounty designated transportation planning agency” means the Southern California Association of Governments.
The multicounty designated transportation planning agency shall conduct its meetings in the manner prescribed by the Ralph M. Brown Act (Chapter 9 (commencing with Section 54950), Part 1, Division 2, Title 5 of the Government Code).
A majority of the members of the executive committee of the agency shall constitute a quorum for the transaction of business. All official acts of the executive committee shall require the affirmative vote of a majority of the members of the executive committee present, with not less than a quorum present.
Except as otherwise provided in subdivision (c) of Section 130109, all provisions of the Orange County Transit District Act of 1965 (Part 4 (commencing with Section 40000) of Division 10), regarding employer-employee relations, employee benefits, and conditions of employment for the Orange County Transit District are equally applicable to the Orange County Transportation Authority as if set forth in this division, and govern employer-employee relations, employee benefits, and conditions of employment for the Orange County Transportation Authority.
CHAPTER 2. Creation of Commissions [130050. - 130059.]
There is hereby created a commission in Los Angeles County, in Orange County, in Riverside County, and in San Bernardino County.
There is hereby created the Ventura County Transportation Commission. The commission shall be the successor agency to the Ventura County Association of Governments and shall assume all assets and liabilities of that association.
Notwithstanding Section 180050, the Board of Supervisors of Ventura County may designate the commission as the authority to carry out the provisions of Division 19 (commencing with Section 180000).
There is hereby created the Los Angeles County Metropolitan Transportation Authority. The authority shall be the single successor agency to the Southern California Rapid Transit District and the Los Angeles County Transportation Commission as provided by the act that enacted this section.
The Los Angeles County Metropolitan Transportation Authority consists of 14 members, as follows:
Five members of the Los Angeles County Board of Supervisors.
If the number of members of the Los Angeles County Board of Supervisors is increased, the authority shall, within 60 days of the increase, submit a plan to the Legislature for revising the composition of the authority.
The Mayor of the City of Los Angeles.
Two public members and one member of the City Council of the City of Los Angeles appointed by the Mayor of the City of Los Angeles.
Four members, each of whom shall be a mayor or a member of a city council, appointed by the Los Angeles County City Selection Committee. For purposes of the selection of these four members, the County of Los Angeles, excluding the City of Los Angeles, shall be divided into the following four sectors:
The North County/San Fernando Valley sector.
The Southwest Corridor sector.
The San Gabriel Valley sector.
The Southeast Long Beach sector.
The League of California Cities, Los Angeles County Division, shall define the sectors. Every city within a sector shall be entitled to vote to nominate one or more candidates from that sector for consideration for appointment by the Los Angeles County City Selection Committee. A city’s vote shall be weighted in the same proportion that its population bears to the total population of all cities within the sector.
The members appointed pursuant to this subdivision shall be appointed by the Los Angeles County City Selection Committee upon an affirmative vote of its members which represent a majority of the population of all cities within the county, excluding the City of Los Angeles.
The members selected by the city selection committee shall serve four-year terms with no limitation on the number of terms that may be served by any individual. The city selection committee may shorten the initial four-year term for one or more of the members for the purpose of ensuring that the members will serve staggered terms.
If the population of the City of Los Angeles, at any time, becomes less than 35 percent of the combined population of all cities in the county, the position of one of the two public members appointed pursuant to subdivision (c), as determined by the Mayor of the City of Los Angeles by lot, shall be vacated, and the vacant position shall be filled by appointment by the city selection committee pursuant to subdivision (d) from a city not represented by any other member appointed pursuant to subdivision (d).
One nonvoting member appointed by the Governor.
Notwithstanding subdivision (c) of Section 130051, if a member appointed by the Mayor of the City of Los Angeles is not a member of the city council of that city, the person appointed may serve for 60 days without consent of the city council.
Every member of the Los Angeles County Metropolitan Transportation Authority is subject to Section 87100 of the Government Code.
Except as provided in subdivision (b), each member of the Los Angeles County Metropolitan Transportation Authority shall serve a term of four years or until his or her successor is appointed and qualified. A member may be removed at the pleasure of the appointing authority. A member may be reappointed for additional terms without limitation on the number of reappointments. Other than the member initially appointed by the Governor, and members appointed to staggered terms pursuant to subdivision (e) of Section 130051, the members initially appointed shall serve until January 1, 1997.
The membership of any member serving on the authority as a result of holding another public office shall terminate when the member ceases holding the other public office.
The Los Angeles County Transportation Commission and the Southern California Rapid Transit District shall conduct joint regular meetings at least once during each quarter of the calendar year.
Notwithstanding subdivisions (a) and (b) of Section 130051, the members of the Los Angeles County Board of Supervisors and the Mayor of the City of Los Angeles, rather than their alternates, shall personally serve at the joint meetings.
Notwithstanding Section 30201, the members of the Los Angeles County Board of Supervisors, rather than their appointees, shall personally serve at the joint meetings.
Notwithstanding Section 30201, the Mayor of the City of Los Angeles, rather than the mayor’s appointee, shall personally serve at the joint meetings as one of the two directors representing the City of Los Angeles.
It is the intent of the Legislature that reasonable efforts be made to discuss major fiscal and policy items related to the Los Angeles County Transportation Commission and the Southern California Rapid Transit District at the meetings required by subdivision (a). This statement of legislative intent shall not be construed as requiring any action which would interfere with, delay, or otherwise impede the orderly and proper functioning of the Los Angeles County Transportation Commission or the Southern California Rapid Transit District.
The Los Angeles County Metropolitan Transportation Authority shall appoint a full-time chief executive officer who shall act for the authority under its direction and perform those duties delegated by the authority.
The chief executive officer shall be appointed to a term of four years and shall be removed from office only upon the occurrence of one or both of the following:
A two-thirds majority of the members of the authority votes for removal.
The chief executive officer violates a federal or state law, regulation, local ordinance, or policy or practice of the authority, relative to ethical practices, including, but not limited to, the acceptance of gifts or contributions.
The chief executive officer shall approve and award all contracts for construction, and that approval shall be based upon the lowest responsible and responsive bid submitted.
The Los Angeles County Metropolitan Transportation Authority shall appoint a general counsel and board secretary.
The members of the Los Angeles County Metropolitan Transportation Authority shall be appointed no later than February 1, 1993. The authority shall have no powers, duties, or responsibilities until February 1, 1993.
From February 1, 1993, until April 1, 1993, the Los Angeles Metropolitan Transportation Authority, exclusively, may exercise any of the powers of the board of directors of the Southern California Rapid Transit District and the governing body of the Los Angeles County Transportation Commission, except those powers that the authority has expressly delegated to the district or to the commission.
The Los Angeles County Metropolitan Transportation Authority may determine its organizational structure, which may include, but is not limited to, the establishment of departments, divisions, subsidiary units, or similar entities. Any department, division, subsidiary unit, or similar entity established by the authority shall be referred to in this chapter as an “organizational unit.” The authority shall, at a minimum, establish the following organizational units:
A transit construction organizational unit to assume the construction responsibilities for all exclusive public mass transit guideway construction projects in Los Angeles County.
An operating organizational unit with the following responsibilities:
The operating responsibilities of the former Southern California Rapid Transit District on all exclusive public mass transit guideway projects in the County of Los Angeles.
The operation of bus routes operated by the former Southern California Rapid Transit District, and all the duties, obligations, and liabilities of the district relating to those bus routes.
A transportation planning and programming organizational unit with all planning responsibilities previously performed by the former Southern California Rapid Transit District and the former Los Angeles County Transportation Commission.
Nothing in this section shall be construed to require specific bus routes to be operated. The authority or the operating organizational unit may make any adjustment with respect to bus routes, bus services, or both, which is within the power of the former Los Angeles County Transportation Commission, or the former Southern California Rapid Transit District.
Any obligations of the former Southern California Rapid Transit District arising out of a collective bargaining agreement entered into by the district shall be the exclusive obligations of the Los Angeles County Metropolitan Transportation Authority. It is the intent of the Legislature that the rights or obligations under any collective bargaining agreement in existence on January 1, 1993, not be enlarged or diminished by this section or any other provision of the act which added this section.
No collective bargaining agreement entered into by the former Southern California Rapid Transit District on or after January 1, 1993, shall be effective unless approved by the Los Angeles County Metropolitan Transportation Authority. The authority’s approval of an agreement shall cause the agreement to be binding upon the authority.
On and after April 1, 1993, any reference to the former Southern California Rapid Transit District in Article 10 (commencing with Section 30750) of Chapter 5 of Part 3 of Division 10 is deemed to refer to the Los Angeles County Metropolitan Transportation Authority.
The Los Angeles County Metropolitan Transportation Authority may administratively delegate to an organizational unit or to its chief executive officer any powers and duties it deems appropriate. Powers and duties which may be delegated to an organizational unit include, but are not limited to, the following:
The power of eminent domain.
Approval of contracts, except the final approval of labor contracts.
Hearing and resolving bid protests.
The Los Angeles County Metropolitan Transportation Authority shall establish a citizens’ advisory council pursuant to subdivision (d) of Section 130105.
The Los Angeles County Metropolitan Transportation Authority shall, at a minimum, reserve to itself exclusively, all of the following powers and responsibilities:
Establishment of overall goals and objectives to achieve optimal transport service for the movement of goods and people on a countywide basis.
Adoption of the aggregate budget for all organizational units of the authority.
Designation of additional included municipal operators pursuant to subdivision (f) of Section 99285.
Approval of final rail corridor selections.
Final approval of labor contracts covering employees of the authority and organizational units of the authority.
Establishment of the authority’s organizational structure.
Conducting hearings and the setting of fares for the operating organizational unit established pursuant to paragraph (2) of subdivision (a) of Section 130051.11.
Approval of transportation zones.
In determining the cost-effectiveness of any proposed transportation zone, the authority may not approve or disapprove a transportation zone based upon consideration of rates of wages and other forms of compensation or hours and working conditions of employees of the proposed transportation zone.
Any determination of efficiencies that may be derived from the approval of a transportation zone shall include consideration of maintaining the prevailing rate of wages, hours, and other terms and conditions of employment contained in current collective bargaining agreements applicable to the authority as required under subdivision (d) of Section 130051.11.
A proposed transportation zone is not required to demonstrate lower operating costs than those of the existing operator or operators of the service to be transferred to the zone, but shall demonstrate that the net cost will not be greater than the current service.
Approval of the issuance of any debt instrument with a maturity date that exceeds the end of the fiscal year in which it is issued.
Approval of benefit assessment districts and assessment rates.
Approval of contracts for transit equipment acquisition that exceed five million dollars ($5,000,000), and making the findings required by subdivision (c) of Section 130238.
The Los Angeles County Metropolitan Transportation Authority shall in conjunction with the other municipal operators in the County of Los Angeles perform a security assessment once every five years to determine the safety and security measures required to protect the operation of their systems and their passengers.
On April 1, 1993, the Southern California Rapid Transit District and the Los Angeles County Transportation Commission are abolished. Upon the abolishment of the district and the commission, the Los Angeles County Metropolitan Transportation Authority shall succeed to any or all of the powers, duties, rights, obligations, liabilities, indebtedness, bonded and otherwise, immunities, and exemptions of the district and its board of directors and the commission and its governing body.
On and after April 1, 1993, any reference in this part, or in any other provision of law or regulation, to the Southern California Rapid Transit District or to the Los Angeles County Transportation Commission or to the county transportation commission in general shall be deemed to refer to the Los Angeles County Metropolitan Transportation Authority.
Upon the abolishment of the Southern California Rapid Transit District and the Los Angeles County Transportation Commission, the Los Angeles County Metropolitan Transportation Authority shall assume the rights and obligations of the district and the commission under any contract to which the district or the commission is a party and which is to be performed, in whole or in part, on or after January 1, 1993. All real and personal property owned by the district or the commission shall be transferred to the authority by operation of law.
The Los Angeles County Metropolitan Transportation Authority shall assume, without any condition whatsoever, all responsibilities and obligations previously assumed by the Southern California Rapid Transit District or the Los Angeles County Transportation Commission with regard to the full funding agreement, including all agreements pursuant to Section 13(c) of the Urban Mass Transportation Act of 1964 which relate to the full funding agreement, with the Federal Transit Administration for the funding of the Los Angeles County Metro Rail Project. It is the intent of the Legislature that nothing in this act shall enlarge or diminish the projects covered or any rights or obligations under any existing agreements pursuant to Section 13(c).
The Los Angeles County Metropolitan Transportation Authority shall not, until April 1, 1993, renew or extend any personal services contract entered into between either the Los Angeles County Transportation Commission or the Southern California Rapid Transit District and an employee or former employee of either agency prior to January 1, 1993.
Notwithstanding any other provision of law, the Los Angeles County Metropolitan Transportation Authority shall assume the duties, obligations, and liabilities of the Southern California Rapid Transit District, including those duties, obligations, and liabilities arising from or relating to collective bargaining agreements or labor obligations imposed by state or federal law, only to the extent that the authority is acting pursuant to specific duties, obligations, liabilities, rights, or powers to which it succeeded as a result of the abolishment of the district pursuant to Section 130051.13.
Any gifts received by members of the board or employees of the Los Angeles County Metropolitan Transportation Authority shall be governed by applicable state law and the authority’s administrative code.
This section, in addition to rules or codes adopted by the board of the Los Angeles County Metropolitan Transportation Authority, shall regulate lobbying of the authority.
For purposes of this section, the following definitions apply:
“Activity expense” means any payment, including any gift, made to, or directly benefiting, any authority official or member of their immediate family, made by a lobbyist, lobbying firm, or lobbyist employer.
“Administrative testimony” means influencing or attempting to influence authority action undertaken by any person or entity who does not seek to enter into a contract or other arrangement with the authority by acting as counsel in, appearing as a witness in, or providing written submissions, including answers to inquiries, which become a part of the record of, any proceeding of the authority that is conducted as an open public hearing for which public notice is given.
“Authority” means the Los Angeles County Metropolitan Transportation Authority and all of its organizational units.
“Authority action” means the drafting, introduction, consideration, modification, enactment, or defeat of an ordinance, resolution, contract, or report by the governing board of an organizational unit of the authority, or by an authority official, including any action taken, or required to be taken, by a vote of the members of the authority or by the members of the governing board of an organizational unit of the authority, except those actions relating to Article 10 (commencing with Section 30750) of Chapter 5 of Part 3 of Division 10.
“Authority official” means any member of the authority, member of an organizational unit of the authority, or employee of the authority.
“Contact” means any communication, oral or written, including communication made through an agent, associate, or employee, for the purpose of influencing authority action, except as provided in subparagraph (B).
The following activities are not “contacts” for purposes of this section:
Attending or participating in a prebid or preproposal conference.
Submitting a response to a solicitation issued by the authority or authority official.
Participating in an interview regarding a solicitation at the request of the authority or authority official.
Responding to a request for information from the authority or authority official regarding a solicitation or existing contract.
A representative of a news media organization gathering news and information or disseminating the same to the public, even if the organization, in the ordinary course of business, publishes news items, editorials or other commentary, or paid advertisements, that urge action upon authority matters.
Providing oral or written testimony that becomes part of the record of a public hearing. A person providing testimony pursuant to this clause who has already qualified as a lobbyist under this section and is testifying on behalf of a client shall identify the client on whose behalf the lobbyist is testifying.
A communication from an elected public official acting in their official capacity.
“Contribution” means a payment, a forgiveness of a loan, a payment of a loan by a third party, or an enforceable promise to make a payment, except to the extent that full and adequate consideration is received, unless it is clear from the surrounding circumstances that it is not made for political purposes.
For purposes of this section, “contribution” also includes all of the following:
An expenditure made at the behest of a candidate, committee, or elected officer is a contribution to the candidate, committee, or elected officer unless full and adequate consideration is received for making the expenditure.
The purchase of tickets for events such as dinners, luncheons, rallies, and similar fundraising events.
The candidate’s own money or property used on behalf of their candidacy.
The granting of discounts or rebates not extended to the public generally or the granting of discounts or rebates by television and radio stations and newspapers not extended on an equal basis to all candidates for the same office.
The payment of compensation by any person for the personal services or expenses of any other person if those services are rendered or expenses are incurred on behalf of a candidate or committee without payment of full and adequate consideration.
Any transfer of anything of value received by a committee from another committee, unless full and adequate consideration is received.
For purposes of this section, “contribution” does not include any of the following:
Amounts received pursuant to an enforceable promise to the extent that those amounts have been previously reported as a contribution. However, the fact that those amounts have been received shall be indicated in the appropriate campaign statement.
A payment made by an occupant of a home or office for costs related to any meeting or fundraising event held in the occupant’s home or office if the costs for the meeting or fundraising event are five hundred dollars ($500) or less.
Volunteer personal services or payments made by any individual for the individual’s own travel expenses if those payments are made voluntarily without any understanding or agreement that they shall be, directly or indirectly, repaid to the individual.
“Employee of the authority” has the same meaning as defined in the authority’s administrative code.
“Ethics officer” means the ethics officer appointed pursuant to Section 130610.
“Filing officer” means the individual designated by the authority with whom statements and reports required by this section shall be filed.
“Lobbying” means influencing or attempting to influence authority action through direct or indirect contact, other than administrative testimony, with an authority official, as described in paragraph (14).
“Lobbying activity” includes any of the following conduct when that conduct is related to a contact to influence any authority action:
Engaging in, either personally or through an agent, written or oral communication with an authority official.
Providing advice or recommending strategy to a person or other entity that may have business in front of the authority.
Research, investigation, and information gathering.
Seeking to influence the position of a third party on issues related to authority action by any means, including, but not limited to, engaging in community, public, or press relations activities.
Attending or monitoring authority meetings or other events.
“Lobbying firm” means any business entity, including an individual lobbyist, that meets either of the following criteria:
The business entity receives or becomes entitled to receive any compensation, other than reimbursement for reasonable travel expenses, for the purpose of influencing authority action on behalf of any other person, if any partner, owner, officer, or employee of the business entity is a lobbyist.
The business entity receives or becomes entitled to receive any compensation, other than reimbursement for reasonable travel expenses, to communicate directly with any agency official for the purpose of influencing authority action on behalf of any other person, if a substantial or regular portion of the activities for which the business entity receives compensation is for the purpose of influencing authority action.
A business entity shall not be considered a lobbying firm by reason of engaging in activities described in subparagraph (B) of paragraph (6).
“Lobbyist” means any individual who receives compensation, other than reimbursement for reasonable travel expenses, and who meets both of the following criteria in a consecutive three-month period:
The individual has at least one contact with an authority official or employee in an attempt to influence authority action.
The individual is compensated to engage in at least 15 hours of lobbying activity in connection with attempts to influence authority action.
“Lobbyist employer” means any person, other than a lobbying firm, who does either of the following:
Employs one or more lobbyists for the purpose of influencing authority action.
Contracts for the services of a lobbying firm for economic consideration for the purpose of influencing authority action.
Lobbyists, lobbying firms, and lobbyist employers shall register with the filing officer within 10 calendar days after qualifying as a lobbyist, lobbying firm, or lobbyist employer. No additional lobbying contacts shall occur before registration. Registration shall include the filing of a registration statement and the payment of any fee required pursuant to paragraph (2). Registration shall be renewed annually by the filing of a new registration statement and the payment of a fee, if applicable, on or before January 31 of the year of renewal.
After registration, each lobbyist, lobbying firm, or lobbyist employer shall retain that status through December 31 of that year unless that status is terminated as set forth in paragraph (6).
The name, address, telephone number, and email address of the lobbyist.
For each person or entity from whom the lobbyist receives compensation to provide lobbying services, all of the following:
The full name, business address, and telephone number of the person or entity.
The lobbying interests of the lobbyist, including identification of specific contracts or authority actions. A description of the types of contracts or authority action is permissible only if a specific contract or authority action cannot be identified.
A statement signed by the lobbyist certifying that the lobbyist has read and understands the prohibitions contained in subdivisions (g) and (h).
Any other information required by the ethics officer consistent with the purposes and provisions of this section.
The full name, business address, telephone number, and email address of the lobbying firm.
The full name of each lobbyist who is a partner, owner, officer, or employee of the lobbying firm.
For each person or entity from which the firm received or became entitled to receive compensation for engaging in lobbying activities and with whom the lobbying firm contracts to provide lobbying services, all of the following:
The full name, business address, telephone number, and email address of the person or entity.
The time period of the contract during which the lobbying activities for which the firm received or became entitled to receive compensation will occur.
The lobbying interests of the lobbying firm, including identification of specific contracts or authority actions. A description of the types of contracts or authority action is permissible only if a specific contract or authority action cannot be identified.
A statement signed by the designated responsible person that the person has read and understands the prohibitions contained in subdivisions (g) and (h).
Any other information required by the ethics officer consistent with the purposes and provisions of this section.
The full name, business address, telephone number, and email address of the lobbyist employer.
A list of the lobbyists who are employed by the lobbyist employer.
The lobbying interests of the lobbyist employer, including identification of specific contracts or authority actions. A description of the types of contracts or authority action is permissible only if a specific contract or authority action cannot be identified.
A statement signed by the designated responsible person that the person has read and understands the prohibitions contained in subdivisions (g) and (h).
Any other information required by the ethics officer consistent with the purposes and provisions of this section.
Lobbyists, lobbying firms, and lobbyist employers that receive payments, make payments, or incur expenses, or expect to receive payments, make payments, or incur expenses, in connection with activities that are reportable pursuant to this section shall keep detailed accounts, records, bills, and receipts for four years, and shall make them reasonably available for inspection for the purposes of auditing for compliance with, or enforcement of, this section.
When a person is required to report activity expenses pursuant to this section, all of the following information shall be provided:
The date and amount of each activity expense.
The full name and official position, if any, of the beneficiary of each expense, a description of the benefit, and the amount of the benefit.
The full name of the payee of each expense if other than the beneficiary.
A lobbying firm shall file a periodic report containing all of the following:
The full name, address, telephone number, and email address of the lobbying firm.
The full name, business address, and telephone number of each person or entity from which the firm received or became entitled to receive compensation for engaging in lobbying activities and who contracted with the lobbying firm for lobbying services.
A description of each contract or authority action that the lobbying firm attempted to influence during the reporting period, including identification of specific contracts or authority actions. A description of the types of contracts or authority action is permissible only if a specific contract or authority action cannot be identified.
The total payments, including fees and the reimbursement of expenses, received or expected from the person or entity for lobbying services during the reporting period.
A copy of the periodic report completed and verified by each lobbyist in the lobbying firm pursuant to paragraph (2).
Each activity expense incurred by the lobbying firm, including those reimbursed by a person who contracts with the lobbying firm for lobbying services.
The date, amount, and the name of the recipient of any contribution of one hundred dollars ($100) or more made by the filer to an authority official.
Any other information required by the ethics officer consistent with the purposes and provisions of this section.
A lobbyist shall complete and verify a periodic report, and file the report with the filing officer, and a copy of the report with their lobbying firm or lobbyist employer. The periodic report shall contain all of the following:
The name, address, telephone number, and email address of the lobbyist.
The full name, business address, and telephone number of the lobbying firm or lobbyist employer from whom the lobbyist receives compensation to provide lobbying services.
A description of each contract or authority action that the lobbyist attempted to influence during the reporting period, including identification of specific contracts or authority actions. A description of the types of contracts or authority action is permissible only if a specific contract or authority cannot be identified.
A report of all activity expenses by the lobbyist during the reporting period.
A report of all contributions of one hundred dollars ($100) or more made or delivered by the lobbyist to any authority official during the reporting period.
Any other information required by the ethics officer consistent with the purposes and provisions of this section.
A lobbyist employer shall file a periodic report containing all of the following:
The name, business address, telephone number, and email address of the lobbyist employer.
The total amount of payments to each lobbying firm. Those payments shall include solely payments for compensation and reimbursement of expenses relating to the lobbying firm’s attempts to influence authority action.
The total amount of all payments to lobbyists employed by the filer. The lobbyist employer shall only be required to disclose whether the total salary payments made to the individual during the reporting period was less than or equal to two hundred fifty dollars ($250), greater than two hundred fifty dollars ($250) but less than or equal to one thousand dollars ($1,000), greater than one thousand dollars ($1,000) but less than or equal to ten thousand dollars ($10,000), or greater than ten thousand dollars ($10,000).
A description of each contract or authority action that the filer attempted to influence during the reporting period, including identification of specific contracts or authority actions. A description of the types of contracts or authority action is permissible only if a specific contract or authority action cannot be identified.
Each activity expense of the filer and a total of all activity expenses of the filer.
The date, amount, and the name of the recipient of any contribution of one hundred dollars ($100) or more made by the filer to an authority official.
The total of all other payments to influence authority action.
Any other information required by the ethics officer consistent with the purposes and provisions of this section.
The periodic reports shall be filed by the last day of the month following the end of each calendar quarter. The period covered shall be from the beginning of the calendar year through the last day of the calendar quarter before the period during which the report is filed, except that the period covered by the first report a person is required to file shall begin with the first day of the calendar quarter in which the filer first registered or qualified.
It is unlawful for a lobbyist, a lobbying firm, or a lobbyist employer to make a gift to an authority official aggregating more than ten dollars ($10) in a calendar month, to act as an agent or intermediary in the making of any gift, or to arrange for the making of any gift by any other person.
It is unlawful for any authority official knowingly to receive any gift that is made unlawful by this section. For the purposes of this subdivision, “gift” has the same meaning as defined in Section 82028 of the Government Code.
A lobbyist, lobbying firm, or lobbyist employer shall not do any of the following:
Do anything with the purpose of placing an authority official under personal obligation to the lobbyist, the lobbying firm, or the employer of the lobbyist or lobbying firm.
Deceive or attempt to deceive any authority official with regard to any material fact pertinent to any authority action.
Cause or influence any authority action for the purpose of thereafter being employed to secure its passage or defeat.
Attempt to create a fictitious appearance of public favor or disfavor of any authority action, or cause any communications to be sent to any authority official in the name of any fictitious person or in the name of any real person, except with the consent of that real person.
Represent falsely, either directly or indirectly, that the lobbyist, lobbying firm, or lobbyist employer can control any authority official.
Accept or agree to accept any payment that is contingent upon the outcome of any authority action.
Any person who knowingly or willfully violates any provision of this section is guilty of a misdemeanor.
The ethics officer may conduct audits of reports and statements filed pursuant to this section. Those audits may be conducted on a random basis or when the ethics officer has reason to believe that a filer has not complied with this section.
In addition to any other penalty or remedy available, the ethics officer may impose a late fee on any person or entity that does not file a report or statement required by this section before a deadline imposed by this section. The late fee shall be in the amount of ten dollars ($10) per day until the statement or report is filed, up to a maximum amount of three hundred dollars ($300). The ethics officer may choose not to impose the late fee if the ethics officer determines that the late filing was not willful and that enforcement of the late fee would not further the purposes of this section.
The ethics officer may issue guidance and advice as necessary to implement this section.
The District Attorney of the County of Los Angeles is responsible for prosecuting violations of this section.
Any person who violates any provision of this section is liable in a civil action brought by the civil prosecutor or by a person residing within the jurisdiction of the authority for an amount up to five hundred dollars ($500), or three times the amount of an unlawful gift or expenditure, whichever amount is greater.
The authority shall reject any bid or other proposal to enter into a contract with the authority by any person or entity that has not complied with the registration and reporting requirements of this section.
This section does not apply to any of the following:
An elected public official who is acting in their official capacity to influence authority action.
Any newspaper or other periodical of general circulation, book publisher, radio or television station that, in the ordinary course of business, publishes or broadcasts news items, editorials, or other documents, or paid advertisement, that directly or indirectly urges authority action, if the newspaper, periodical, book publisher, radio or television station engages in no further or other activities in connection with urging authority action other than to appear before the authority in support of, or in opposition to, the authority action.
A former authority official shall not become a lobbyist for a period of one year after leaving the authority.
The Los Angeles County Metropolitan Transportation Authority shall adopt an affirmative action plan for its management positions which reflects the ethnic demographics of the county, taking into consideration the availability of the work force in the various ethnic groups.
The authority shall, prior to the approval of any contract by the authority or by its organization units, adopt and implement a disadvantaged business enterprise program which establishes participation goals of not less than 15 percent of the dollar value of all contracts by minority business enterprises and not less than 5 percent by women business enterprises.
The authority shall establish a Transportation Business Advisory Council to advise it on matters regarding the disadvantaged business enterprise program to enable the authority to meet or exceed women and minority business enterprise participation goals. Members of the council shall be selected by the authority, and shall include representatives of professional organizations and other groups which advocate on behalf of greater participation of women and minority business enterprises in public contracts. The chairperson of the authority or his or her designee shall meet with the council, and the authority shall provide adequate staff support for the council, and shall consider all recommendations made by the council.
A former board member or employee of MTA shall not accept compensation from an MTA contractor as an employee, officer, director, or consultant of the contractor within 12 months after the former board member or employee served in any of the following capacities:
As a member of the procurement evaluation team for a contract that was awarded to that contractor.
As the procuring contract officer for a contract that was awarded to that contractor.
As the project manager or deputy project manager for a contract that was awarded to that contractor.
As an agency executive with oversight responsibilities for a contract awarded to that contractor if the executive participated in the contract development, proposal review, or approval, or provided agency signatory authority related to the contract or project.
As a substantial participant in an MTA decision to do any of the following:
Award a contract, subcontract, modification of a contract or subcontract, or a task order or delivery order to that contractor.
Develop a contract awarded to that contractor, including developing the scope of work.
Approve issuance of one or more contract payments to that contractor.
Pay or settle a claim with that contractor.
For purposes of paragraph (1) of subdivision (a), a former board member’s or former employee’s service ends at the completion of the evaluation period, or the former board member’s or former employee’s last day of service with MTA, whichever occurs first.
For purposes of paragraphs (2) to (5), inclusive, of subdivision (a), a former board member’s or former employee’s service ends at the completion of the contract term, or the former board member’s or former employee’s last day of service with MTA, whichever occurs first.
The inspector general appointed pursuant to Section 130051.28 may enforce this section.
The Los Angeles County Transportation Commission and the Southern California Rapid Transit District shall each cause a supplemental independent fiscal audit to be conducted for the period beginning July 1, 1992, and ending March 30, 1993, for the purpose of determining the financial condition of each agency prior to the abolishment of those agencies pursuant to Section 130051.13. Thereafter, the Los Angeles County Metropolitan Transportation Authority shall cause an independent fiscal audit of the authority to be conducted annually and shall consider the results of the audit at a duly noticed public hearing.
The authority may establish and maintain a prequalification program for bidders on contracts not covered by subdivision (b).
On public projects, as defined in subdivision (c) of Section 22002 of the Public Contract Code, the authority shall require, at a minimum, that prospective bidders for a construction contract complete and submit to the authority a prequalification standardized questionnaire and financial statement in a form specified by the authority, pursuant to subdivision (a) of Section 20101 of the Public Contract Code.
Whenever the Los Angeles County Metropolitan Transportation Authority by resolution determines that any record, map, book, or paper in the possession of the authority or any officer or employee thereof is of no further value to the authority, the board may authorize its sale, destruction, or other disposition. Documents significant to the activities of the authority, including, but not limited to, board and committee agendas, incoming and outgoing correspondence, and contractual documents, shall be microfilmed or otherwise preserved prior to the sale, destruction, or other disposition of the original.
For the purposes of this section, the following terms have the following meanings, unless the context requires otherwise:
The “authority” is the Los Angeles County Metropolitan Transportation Authority.
A “transportation zone” is a public agency or a public benefit corporation of which public agencies are the sole members established on or after January 1, 1999, that assumes any of the operating responsibilities described in paragraph (2) of subdivision (a) of Section 130051.11 on or after that date, regardless of whether the transportation zone is an included municipal operator, as defined in Section 99207, or an included transit district, as defined in Section 99208.
Except as authorized under paragraph (2), a transportation zone shall assume and be bound by the terms and conditions of employment set forth in any collective bargaining agreements between the authority and any labor organizations affected by the creation of the transportation zone as well as the duties, obligations, and liabilities arising from, or relating to, labor obligations imposed by state or federal law upon the authority.
Notwithstanding paragraph (1), if the authority is engaged in collective bargaining with labor organizations representing employees who are subject to transfer to the transportation zone between the date of approval of the transportation zone and the date of the transfer of service to the transportation zone, the authority may consult with the transportation zone regarding matters within the scope of labor representation.
If independent bargaining units are established as authorized under paragraph (2), the transportation zone may enter into agreements with labor organizations as a separate employer, regarding wages, benefits, and other terms and conditions of employment.
The transportation zone shall maintain single employer collective bargaining units for transportation operations and maintenance employees. Those bargaining units shall contain classifications for employees that are identical to those that existed for the joint collective bargaining units of the authority and the transportation zone under paragraph (1), unless modified by mutual agreement between the transportation zone and the affected labor organizations.
A transportation zone shall maintain, as a cosponsor with the authority, any retirement system established and maintained under subdivision (b) of Section 130110, until participation in the retirement system or retirement benefits are modified under the collective bargaining process.
The transportation zone may appoint at least one member to the retirement board of the retirement system. If the size of the board is increased pursuant to this section, an equivalent number of representatives of the labor organization representing the employees shall be appointed to the board to ensure that the board maintains an equal number of employer and labor organization members.
Prior to the transfer of any service to a transportation zone, the plan administrator for the retirement system shall permit the transportation zone to perform an actuarial financial examination of the assets and liabilities of the retirement system and the benefits accrued under it.
The liability of the transportation zone for obligations under the retirement system shall be limited to benefits accruing to employees of the transportation zone.
The transportation zone shall maintain the health care provisions contained in any assumed collective bargaining agreement, until those provisions are modified through the collective bargaining process.
The transportation zone may not be held liable for financial obligations to any health care provider that arose prior to the direct transfer of employees from the authority to the transportation zone.
Labor relations in a transportation zone shall be governed under Article 10 (commencing with Section 30750) of Chapter 4 of Part 3 of Division 10, except that whenever a duty or power is imposed upon or granted to the authority under those provisions, the duty or power, for the purposes of this section, shall be deemed to be imposed upon or granted to the transportation zone as well as the authority.
Nothing in this section prohibits a transportation zone from contracting for managerial services that are not provided by any classification of any bargaining unit.
A transportation zone is not an organizational unit of the authority.
For the purpose of this section, “recordable injury” means any injury requiring treatment beyond simple first aid.
A construction firm that contracts with the Los Angeles County Metropolitan Transportation Authority shall report total recordable injuries to the authority on a monthly basis.
The authority shall annually determine if the number of recordable injuries reported to the authority during the preceding calendar year exceeded the national average of similar injuries as reported by the Bureau of Labor Statistics for the most recent published year. If the authority determines that the number of recordable injuries reported to the authority during the preceding calendar year exceeded the national average, the authority shall not base any safety bonus program for contractors on injuries that result in lost time, and shall base such a program on the overall rate of recordable injuries.
The Los Angeles County Metropolitan Transportation Authority shall appoint an inspector general to a term of office of four years. The inspector general shall be removed from office only if either or both of the following occur:
A two-thirds majority of the members of the authority votes for removal.
The inspector general violates a federal or state law or regulation, a local ordinance, or a policy or practice of the authority, relative to ethical practices, including, but not limited to, the acceptance of gifts or contributions.
The inspector general shall, at a noticed public hearing of the authority, report quarterly on the expenditures of the authority for travel, meals and refreshments, private club dues, membership fees and other charges, and any other expenditures which are specified by the authority.
Any investigatory file compiled by the inspector general is an investigatory file compiled by a local law enforcement agency subject to disclosure pursuant to Article 1 (commencing with Section 7923.600) of Chapter 1 of Part 5 of Division 10 of Title 1 of the Government Code.
The Orange County Transportation Commission shall be known as the Orange County Transportation Authority and shall be governed by a board of directors consisting of 18 members appointed as follows:
Five members of the Orange County Board of Supervisors appointed by that board. Terms of office of the five members of the board of supervisors shall be determined by the board of supervisors. A board of supervisors member’s term shall cease if he or she no longer serves as a member of the board of supervisors.
Five city members, with one from each of the five supervisorial districts, elected by the Orange County City Selection Committee members within each supervisorial district on a population-weighted voting basis.
Five city members, with one from each of the five supervisorial districts, elected on a “one city, one vote” basis by the Orange County City Selection Committee members within each supervisorial district.
A city that is within more than one supervisorial district shall be considered part of the district where the highest percentage of the city’s population resides. Under this circumstance, the entire city’s population shall be used for population-weighted voting purposes. Each city member shall be a mayor or a city council member serving within the county. Terms of office of each city member shall be determined by the Orange County City Selection Committee. A city member’s term shall cease if he or she no longer serves as a member of a city council or as the mayor of a city.
A city member serving on the authority on the effective date of the act amending this section in the 2003–04 Regular Session shall continue to serve until the earliest of either the expiration of his or her term or until he or she no longer serves as a mayor or member of a city council.
Two public members appointed by a majority vote of the other 15 voting members of the authority. Each public member shall be a resident of Orange County who is not then serving, and has not within the last four years served, as an elected official of a city within the county, as an elected official of any agency or special district within Orange County, or as an elected official of the county. Each public member shall serve for a term of four years.
The Director of Transportation, District 12, who shall be appointed by the Governor as a nonvoting member. The member shall serve for a term of four years.
The members of the Orange County Transportation Authority, comprised as specified by Section 130052, shall serve as the governing body of the Orange County Service Authority for Freeway Emergencies.
Until July 1, 1996, any included municipal operator within the jurisdiction of the Orange County Transportation Authority shall annually be allocated a level of funding pursuant to the Mills-Alquist-Deddeh Act (Chapter 4 (commencing with Section 99200) of Part 11 of Division 10) which is not less than the amount allocated to that operator during the 1989–90 fiscal year adjusted by an amount equal to the previous year’s allocation multiplied by the Los Angeles-Anaheim-Riverside Consumer Price Index, if the apportionment under Section 99231 is not exceeded, and the operator complies with the expenditure limit prescribed by Section 99268.
The Orange County Transportation Commission, the Orange County Transit District, the Orange County Service Authority for Freeway Emergencies, and the Orange County Consolidated Transportation Services Agency shall jointly develop a comprehensive plan for consolidation of the functions of these agencies. The plan shall include, but not be limited to, all of the following:
An institutional structure that provides for the consolidation of all functions of the agencies within a unified management structure responsible to a single policy board.
A staffing plan that defines the personnel needs of the consolidated agencies.
A financial plan that includes an estimate of the revenues available to the consolidated agencies, related restrictions or requirements, and an estimate of the expenditures under the consolidation plan.
Recommendations for legislation necessary to implement the plan.
The plan shall be approved by the Orange County Transportation Commission and the Board of Directors of the Orange County Transit District and shall be transmitted to the Legislature, the Governor, and the Controller on or before December 1, 1991.
Nothing in this section prohibits the Orange County Transportation Commission, the Orange County Transit District, the Orange County Service Authority for Freeway Emergencies, or the Orange County Consolidated Transportation Services Agency, pursuant to any authority which each respective agency possessed on January 1, 1991, from implementing all or part of the plan prior to its receipt by the Legislature.
The Riverside County Transportation Commission shall consist of the following regular members:
Five members of the Riverside County Board of Supervisors.
One member from each incorporated city in Riverside County, each of whom shall be a mayor or city council member.
One nonvoting member appointed by the Governor.
The Riverside County Board of Supervisors shall establish a procedure by which a member of that board may appoint an alternate member of the board of supervisors to represent the member for one meeting of the Riverside County Transportation Commission. Notice of the alternate appointment shall be made in writing to the clerk of the commission 24 hours prior to the meeting.
Each incorporated city in Riverside County shall appoint one alternate member to the commission who shall represent the regular member of the commission who serves on behalf of the city, if the regular member is not in attendance at a meeting. Notice of the alternate appointment shall be made in writing to the clerk of the commission 24 hours prior to the meeting. If an incorporated city appoints an alternate member, the alternate member shall be either the mayor or a city council member of that incorporated city.
Except as specified in subdivision (b), each regular member of the Riverside County Transportation Commission, or an alternate member acting in the place of a regular member pursuant to Section 130053.5, shall have one vote at meetings of the commission.
Notwithstanding subdivision (a), any member of the commission, immediately after a vote of the commission in accordance with subdivision (a), may call for a weighted vote. For an item to be passed by weighted vote, all of the following requirements shall be met:
The item shall be approved by a majority of the commission members present at the meeting who represent the board of supervisors, who each shall have one vote.
The item shall be approved by a majority of the commission members present at the meeting who represent cities in Riverside County, who each shall have one vote.
The item shall be approved by commission members present at the meeting who represent cities in Riverside County representing a majority of the population of the county living in incorporated areas. For the purpose of this paragraph, each regular commission member at the meeting who represents a city in Riverside County shall be assigned votes based on the percentage of the population of incorporated areas of Riverside County represented by that member in relation to the total population of incorporated areas of Riverside County represented at the meeting. Population data shall be determined through Department of Finance estimates, adjusted annually.
Notwithstanding Section 130102, a quorum of the Riverside County Transportation Commission shall be a majority of the total voting membership of the commission.
The Ventura County Transportation Commission shall consist of the following members:
Five members of the Ventura County Board of Supervisors.
One member from each incorporated city within Ventura County who shall be the mayor of the city or a member of its city council. The term of a member under this subdivision terminates when he or she ceases to hold that office or when replaced by the city council.
One citizen member appointed by the Ventura County Board of Supervisors, who shall not be an elected official, but who shall be a resident of Ventura County.
One citizen member appointed by the Ventura County City Selection Committee, who shall not be an elected official, but who shall be a resident of Ventura County.
One nonvoting member appointed by the Governor.
The Governor shall appoint a nonvoting member to each of the commissions to represent the interest of state.
The appointees shall serve terms of four years and until their successors are appointed and qualified.
No individual shall serve as a nonvoting member more than two terms on a commission.
The commissions shall merge with, or otherwise join, any statutorily created multifunctional regional government organization, if it has transportation planning and programming responsibilities as specified in Article 5 (commencing with Section 130300) of Chapter 4, within one year of creation of such an organization.
The commissions shall rely to the maximum extent possible on existing state, regional, and local transportation planning and programming data and expertise, rather than on a large duplicative commission staff and set of plans.
The Legislature envisions the development of a small, but very capable, core staff able to provide the commissions with an objective analysis of the various options relative to plans and proposed projects of the regional and local transportation agencies and operators, and then translate those options into a short-range transportation improvement program to be developed and approved pursuant to subdivision (b) of Section 130303 in accordance with decisions made by the commissions.
It is the intent of the Legislature that, after the development and approval of the short-range transportation improvement program pursuant to subdivision (b) of Section 130303, the transportation agencies responsible for the implementation of the program shall be granted discretion on how to best implement the program. Any changes made in the program by such an agency in its implementation shall be consistent with the purposes of the program, and the commission shall be immediately notified of such changes.
It is the intent of the Legislature that, working through the multicounty designated transportation planning agency, the four commissions be encouraged to develop joint powers agreements or other contractual arrangements between themselves in the development of transportation facilities or for the provision of transportation services where the commissions feel such arrangements are in the public interest.
The multicounty designated transportation planning agency shall convene at least two meetings annually of representatives from each of the four commissions, the agency, and the Department of Transportation for the following purposes:
To review and discuss the near-term transportation improvement programs prior to adoption by the commissions.
To review and discuss the regional transportation plan prior to adoption by the agency pursuant to Chapter 2.5 (commencing with Section 65080) of Title 7 of the Government Code.
To consider progress in the development of a regionwide and unified public transit system.
To review and discuss any other matter of mutual concern.
CHAPTER 3. Administration [130100. - 130110.]
Except as otherwise provided in Section 130052, each commission at its first meeting, and thereafter annually at the first meeting in January or at such other date as the commission may determine, shall elect a chairperson from its members who shall preside at all meetings, and a vice chairperson who shall preside in his or her absence. In the event of their absence or inability to act, the members present, by an order entered in the minutes, shall select one of their members to act as chairperson pro tempore, who, while so acting, shall have all of the authority of the chairperson.
The commission shall establish rules for its proceedings consistent with the law of the State of California.
A majority of the members of the commission shall constitute a quorum for the transaction of business, and all official acts of the commission shall require the affirmative vote of a majority of the members of the commission.
The acts of the commission shall be expressed by motion, resolution, or ordinance.
All meetings of the commission shall be conducted in the manner prescribed by the Ralph M. Brown Act (Chapter 9 (commencing with Section 54950), Part 1, Division 2, Title 5 of the Government Code).
All meetings of the citizens’ advisory committee and technical advisory committee shall be held pursuant to Section 54952.3 of the Government Code, and no other provision of the Ralph M. Brown Act shall apply to meetings of these committees.
The commission shall:
Adopt an annual budget and fix the compensation of its officers and employees.
Adopt an administrative code, by ordinance, which shall prescribe the powers and duties of commission officers, the method of appointment of commission employees, and methods, procedures, and systems of operation and management of the commission.
Cause a postaudit of the financial transactions and records of the commission to be made at least annually by a certified public accountant.
Appoint, not later than July 1, 1977, a citizens’ advisory committee, which membership shall reflect a broad spectrum of interests and all geographic areas of the county. Members of the staff of the commission, as determined by the commission, shall be available to aid the citizens’ advisory committee in its work.
Appoint a technical advisory committee of representatives from all of the transit operators, all of the cities and the county, and the Department of Transportation, and such other advisory committees it deems necessary.
Do any and all things necessary to carry out the purposes of this division.
Notice of time and place of the public hearing for the adoption of the annual budget shall be published pursuant to Section 6061 of the Government Code, and shall be published not later than the 15th day prior to the date of the hearing.
The proposed annual budget shall be available for public inspection at least 15 days prior to the hearing.
The commission shall appoint a full-time executive director who shall act for the commission under its direction.
The commission may appoint such officers as it deems necessary to carry out its duties and functions.
Each member of a commission may be compensated at a rate not exceeding one hundred dollars ($100) for any day attending to the business of the commission, but not to exceed four hundred dollars ($400) in any month, and the necessary traveling and personal expenses incurred in the performance of his or her duties as authorized by the commission. Members of the San Bernardino County Transportation Authority shall be compensated pursuant to this subdivision. Members of the Los Angeles County Metropolitan Transportation Authority shall be compensated pursuant to subdivision (b).
Each member of the Los Angeles County Metropolitan Transportation Authority shall be compensated at a rate not exceeding one hundred and fifty dollars ($150) for any day attending to the business of the authority, but not to exceed six hundred dollars ($600) per month, and other expenses which are directly related to the performance of duties as authorized by the authority.
Notwithstanding Section 130108, the Board of Directors of the Orange County Transportation Authority may allow members of the board necessary traveling and personal expenses incurred in performance of duties authorized by the board and may allow members per diem compensation at the maximum rate of one hundred dollars ($100) per day, not to exceed five hundred dollars ($500) in any calendar month, for attending board meetings and for performance of any other services for the authority as authorized by the board.
Except as otherwise provided in subdivision (b), the commission shall enter into a contract with the Board of Administration of the Public Employees’ Retirement System, and the board shall enter into that contract, to include all of the employees of the commission into that retirement system, and the employees shall be entitled to substantially similar health benefits as are state employees pursuant to Part 5 (commencing with Section 22750) of Division 5 of Title 2 of the Government Code.
For purposes of providing retirement benefits, the commission may contract with the retirement system that the employees of the county in which the commission is located are members of in lieu of contracting with the board.
Each person employed by the Orange County Transportation Commission on January 1, 1992, may, no later than February 1, 1992, elect to either remain a member of the Public Employees’ Retirement System or become a member of the Orange County Employees Retirement System. All persons who become employed by the commission after February 1, 1991, shall be members of the Orange County Employees Retirement System.
Upon creation of the Ventura County Transportation Commission, and on the effective date of a contract with the Board of Administration of the Public Employees’ Retirement System, existing balances in the Ventura County Association of Governments Account in the Public Employees’ Retirement Fund shall be transferred to the commission’s account in that fund.
For employees of the Los Angeles County Metropolitan Transportation Authority not in a bargaining unit represented by a labor organization, the authority shall establish retirement benefits pursuant to Article 1 (commencing with Section 30400) and Article 2 (commencing with Section 30430) of Chapter 4 of Part 3 of Division 10.
Retirement benefits for employees of the authority and any organizational unit of the authority in a bargaining unit represented by a labor organization shall be established pursuant to Article 3 (commencing with Section 30450) of Chapter 4 of Part 3 of Division 10.
Retirement benefits for employees of the authority and any organizational unit of the authority in a bargaining unit represented by a labor organization that was created on or after January 1, 1999, for the purpose of representing managerial employees or supervisorial employees, shall be established pursuant to a collective bargaining agreement between the authority or any organizational unit of the authority and that labor organization.
CHAPTER 4. Powers and Functions [130200. - 130455.]
ARTICLE 1. Corporate Powers [130200. - 130203.]
The commission has perpetual succession and may adopt a seal and alter it at its pleasure.
The commission may sue and be sued, except as otherwise provided by law, in all actions and proceedings, in all courts and tribunals of competent jurisdiction.
All claims for money or damages against the commission are governed by Division 3.6 (commencing with Section 810) of Title 1 of the Government Code except as provided therein, or by other statutes or regulations expressly applicable thereto.
Whenever a commission, by resolution, determines that any record, map, book, paper, or other document of the commission in the possession of the commission or any officer or employee for 10 years or more is of no further use or value to the commission, the commission may authorize its sale, destruction, or other disposition.
ARTICLE 2. Contracts [130220. - 130246.]
The commission may make contracts and enter into stipulations of any nature whatsoever either in connection with eminent domain proceedings or otherwise, including, without limiting the generality of the foregoing, contracts and stipulations to indemnify and save harmless, to employ labor, and to do all acts necessary and convenient for the full exercise of the powers granted in this division.
The commission has the power of eminent domain to take any property necessary, incidental, or convenient to the exercise of its powers pursuant to this division.
The commission may exercise the power of eminent domain to acquire property outside its territorial limits for environmental mitigation purposes only if otherwise authorized by law and only to the extent so authorized, and only with the consent of the board of supervisors of the county in which the mitigation will occur.
No action to acquire property by eminent domain within any incorporated city or within the unincorporated area of any county shall be commenced unless written notice is given to the legislative body of the affected city or county, as the case may be, in accordance with Section 1245.235 of the Code of Civil Procedure, and the affected city or county, as the case may be, shall have the same rights to a hearing before the commission as a person to whom notice is otherwise required to be given under that section.
The commission may contract with any department or agency of the United States of America, with any public agency (including, but not limited to, the Department of Transportation, the multicounty designated transportation planning agency, or any transit district, county, or city), or with any person upon such terms and conditions as the commission finds is in its best interest.
The Los Angeles County Transportation Commission is authorized to impose a transactions and use tax within the County of Los Angeles pursuant to the approval by the voters of the commission’s Ordinance No. 16 in 1980 and its Ordinance No. 49 in 1990, and has the authority and power vested in the Southern California Rapid Transit District to plan, design, and construct an exclusive public mass transit guideway system in the County of Los Angeles, including, but not limited to, Article 5 (commencing with Section 30630 of Chapter 5 of Part 3 of Division 11).
The commission shall conform to this article in letting contracts for the construction of that system.
Except as provided in subdivisions (f) and (g), purchase of all supplies, equipment, and materials, and the construction of all facilities and works, when the expenditure required exceeds twenty-five thousand dollars ($25,000), shall be by contract let to the lowest responsible bidder. Notice requesting bids shall be published at least once in a newspaper of general circulation. The publication shall be made at least 10 days before the date for the receipt of the bids. The commission, at its discretion, may reject any and all bids and readvertise.
Except as provided for in subdivisions (f) and (g), whenever the expected expenditure required exceeds one thousand dollars ($1,000), but not twenty-five thousand dollars ($25,000), the commission shall obtain a minimum of three quotations, either written or oral, that permit prices and terms to be compared.
Where the expenditure required by the bid price is less than fifty thousand dollars ($50,000), the executive director may act for the commission.
All bids for construction work submitted pursuant to this section shall be presented under sealed cover and shall be accompanied by one of the following forms of bidder’s security:
Cash.
A cashier’s check made payable to the commission.
A certified check made payable to the commission.
A bidder’s bond executed by an admitted surety insurer, made payable to the commission.
Upon an award to the lowest bidder, the security of an unsuccessful bidder shall be returned in a reasonable period of time, but in no event shall that security be held by the commission beyond 60 days from the date that the award was made.
The following provisions apply only to the Los Angeles County Metropolitan Transportation Authority:
The contract shall be let to the lowest responsible bidder or, in the authority’s discretion, to the person who submitted a proposal that provides the best value to the commission on the basis of the factors identified in the solicitation when the purchase price of all supplies, equipment, and materials exceeds one hundred fifty thousand dollars ($150,000). “Best value” means the overall combination of quality, price, and other elements of a proposal that, when considered together, provide the greatest overall benefit in response to requirements described in the solicitation documents. The contract shall be let to the lowest responsible bidder when the purchase price of the construction of all facilities exceeds twenty-five thousand dollars ($25,000).
The authority shall obtain a minimum of three quotations, either written or oral, that permit prices and terms to be compared whenever the expected expenditure required exceeds three thousand dollars ($3,000), but not one hundred fifty thousand dollars ($150,000).
The authority may purchase supplies, equipment, and materials from a public auction sale, including public auctions held via the internet, using the procedures established for all other participants in the public auction.
The authority may participate in a procurement agreement involving other public entities that is identified by a procuring public entity or entities as a cooperative procuring agreement from which other public entities may make purchases or enter into contracts, and the authority may procure, and enter into contracts for, items purchased pursuant to that procurement agreement, notwithstanding that the authority may not be the procuring public entity, provided the procurement agreement is awarded or entered into by either of the following:
One or more public entities or an organization of public entities, which may include the authority.
A federal, state, or local public entity.
Notwithstanding any other law requiring the authority to award contracts to the lowest responsible bidder, the authority may, except as to contracts for professional services involving private architectural, landscape architectural, engineering, environmental, land surveying, or construction project management as defined in Sections 4525 and 4529.10 of the Government Code, do any of the following in facilitating contract awards with small business enterprises, medium business enterprises, local small business enterprises, and disabled veteran business enterprises:
Provide for a small business enterprise preference in construction, the construction component of a design-build team, the procurement of goods, or the delivery of services. The preference to a small business enterprise shall be 5 percent of the lowest responsible bidder meeting specifications that provides for small business enterprise participation.
Provide for a local small business enterprise preference in construction, the construction component of a design-build team, the procurement of goods, or the delivery of services. The preference to a local small business enterprise shall be 5 percent of the lowest responsible bidder meeting specifications that provides for local small business enterprise participation. The authority may also offer the preference to a nonlocal business if the bid includes a 30-percent participation by local small business enterprises.
Establish a subcontracting participation goal for small business enterprises on contracts financed with nonfederal funds and grant a preference of 5 percent to the lowest responsible bidders who meet the goal.
Require bidders, before the time bids are opened, to comply with the small business enterprise and disabled veteran business enterprise goals and requirements established by the authority on contracts financed with nonfederal funds.
In awarding contracts to the lowest responsible bidder, award the contract to the lowest responsible bidder meeting the small business enterprise and disabled veteran business enterprise goals.
Until January 1, 2028, set aside work for competition among certified small business enterprises and award each contract to the lowest responsible bidder whenever the expected expenditure required exceeds five thousand dollars ($5,000) but is less than five million dollars ($5,000,000), as long as price quotations are solicited by the authority from three or more certified small business enterprises.
Until January 1, 2028, set aside work for competition among medium business enterprises for no more than 20 contracts and award each contract to the lowest responsible bidder whenever the expected expenditure required exceeds five million dollars ($5,000,000) but is less than thirty million dollars ($30,000,000), as long as price quotations are solicited by the authority from three or more medium business enterprises.
If the authority awards contracts pursuant to clause (vi) or (vii) of subparagraph (A), the authority, for purposes of legislative oversight, shall prepare and submit the reports described in this subparagraph to the Legislature regarding contracts awarded pursuant to clauses (vi) and (vii) of subparagraph (A). The reports shall be submitted in compliance with Section 9795 of the Government Code and shall be submitted in accordance with the following:
By December 31, 2023, for contracts issued between January 1, 2019, and December 31, 2023.
By December 31, 2026, for contracts issued between January 1, 2019, and December 31, 2026. The report shall note the number of employees working at a medium business enterprise receiving awards pursuant to this section.
A small or medium business enterprise recommended for a contract award through use of a set aside shall be performing a commercially useful function. A small business enterprise shall be presumed to be performing a commercially useful function if it performs and exercises responsibility of at least 30 percent of the total cost of the contract work with its own workforce.
“Small business enterprise” as used in this paragraph, means a business enterprise that is classified as a small business under United States Small Business Administration rules and meets the current small business enterprise size standards found in Part 121 of Title 13 of the Code of Federal Regulations appropriate to the type of work the enterprise seeks to perform. The authority may establish limitations regarding the average annual gross receipts of a small business over the previous three fiscal years and establish limitations regarding the personal net worth of the owner of the small business, exclusive of the value of the owner’s personal residence.
“Local small business enterprise” as used in this paragraph, means a business enterprise that is classified as a small business under United States Small Business Administration rules, meets the current small business enterprise size standards found in Part 121 of Title 13 of the Code of Federal Regulations appropriate to the type of work the enterprise seeks to perform, and is headquartered in the County of Los Angeles.
“Medium business enterprise” as used in this paragraph means a company that is not a subsidiary of another company and that has a maximum of 250 employees and a maximum of two hundred fifty million dollars ($250,000,000) in gross annual receipts averaged over three years.
“Disabled veteran business enterprise” as used in this paragraph has the meaning as defined in Section 999 of the Military and Veterans Code.
“Goal” as used in this paragraph means a numerically expressed objective that bidders are required to achieve.
The following provisions apply only to the San Bernardino County Transportation Authority:
The purchase of all supplies, equipment, and materials, when the expenditure required exceeds one hundred thousand dollars ($100,000), shall, by contract, be let to the lowest responsible bidder, or, in the authority’s discretion, to the responsible bidder who submitted a proposal that provides the best value to the authority on the basis of the factors identified in the solicitation. “Best value” means the overall combination of quality, price, and other elements of a proposal that, when considered together, provide the greatest overall benefit in response to the requirements described in the solicitation documents.
To the extent practicable, the authority shall obtain a minimum of three quotations, either written or oral, that permit prices and terms to be compared whenever the expected expenditure required for the purchase of supplies, equipment, or materials exceeds five thousand dollars ($5,000), but does not exceed one hundred thousand dollars ($100,000).
Except as provided in subdivision (b), if, after rejecting bids received under Section 130232, the commission determines and declares, by a two-thirds vote of all of its members, that the supplies, equipment, or materials may be purchased at a lower price in the open market, the commission may proceed to purchase those supplies, equipment, or materials in the open market without further observance of the provisions in this article regarding contracts, bids, advertisement, or notice.
If, after rejecting bids received under Section 130232, the San Bernardino County Transportation Authority determines and declares, by a majority vote of all of its members, that the supplies, equipment, or materials may be purchased at a lower price in the open market, the authority may proceed to purchase those supplies, equipment, or materials in the open market without further observance of the provisions in this article regarding contracts, bids, advertisement, or notice.
In case of any great public calamity, such as an extraordinary fire, flood, storm, epidemic, or other disaster, or interruption of contracts essential to the provision of daily transit service or catastrophic failure of revenue-producing equipment or facilities, the commission may, by resolution passed by a two-thirds vote of all its members, declare and determine that public interest and necessity demand the immediate expenditure of public money to safeguard life, health, or property, and thereupon proceed to expend or enter into a contract involving the expenditure of any sum needed in the emergency without observance of the provisions in this article regarding contracts, bids, advertisement, or notice.
Upon determining that immediate remedial measures to avert or alleviate damage to property, or to replace, repair, or restore damaged or destroyed property, of the commission are necessary in order to ensure that the facilities of the commission are available to serve the transportation needs of the general public, and upon determining that available remedial measures, including procurement or construction in compliance with Sections 130232, 130233, and 130234 are inadequate, the executive director may authorize the expenditure of money previously appropriated specifically by the commission for the direct purchases of goods and services, without following those sections.
The executive director shall, after any such expenditure, submit to the commission a full report explaining the necessity for the action.
Notwithstanding Section 130232, and upon a finding by two-thirds vote of all members of the commission that the proposed purchase in compliance with Sections 130232 and 130233 does not constitute a method of procurement adequate for the operation of commission facilities or equipment, the commission may direct the procurement of prototype equipment or modifications in an amount sufficient to conduct and evaluate operational testing without further observance of any provisions in this article regarding contracts, bids, advertisements, or notice.
Notwithstanding Section 130232, the commission may direct the purchase of any supply, equipment, or material without observance of any provision in this article regarding contracts, bids, advertisement, or notice upon a finding by two-thirds of all members of the commission that there is only a single source of procurement therefor and that the purchase is for the sole purpose of duplicating or replacing supply, equipment, or material already in use.
The Legislature finds and declares that (1) because of the highly specialized and unique nature of all rail transit equipment, (2) because of products and materials which are undergoing rapid technological changes, and (3) for the introduction of new technological changes into the operations of the commission, it may be in the public interest to consider, in addition to price, factors such as vendor financing, performance reliability, standardization, life-cycle costs, delivery timetables, support logistics, and the broadest possible range of competing products and materials available, fitness of purchase, manufacturer’s warranty, and similar factors in the award of contracts for these vehicles and equipment.
This section applies only to the purchase by the commission of (1) specialized rail transit equipment, including rail cars, and (2) computers, telecommunications equipment, fare collections equipment, microwave equipment, and other related electronic equipment and apparatus. This section does not apply to contracts for construction or for the procurement of any product available in substantial quantities to the general public.
The commission may, after finding by a two-thirds vote of all of its members that a particular procurement qualifies under subdivision (b), direct that the procurement be conducted through competitive negotiation under this section. For purposes of this section, competitive negotiation includes, but is not limited to, all of the following requirements:
The request for proposals shall be prepared and submitted to an adequate number of qualified sources, as determined by the commission, to permit reasonable competition consistent with the nature and requirement of the procurement.
Notice of the request for proposals shall be published at least twice in a newspaper of general circulation, at least 10 days before the date for receipt of the proposals.
The commission shall make every effort to generate the maximum feasible number of proposals from qualified sources and shall make a finding to that effect before proceeding to negotiate if only a single response to the request for proposals is received.
The request for proposals shall identify all significant evaluation factors, including price, and their relative importance.
The commission shall provide reasonable procedures for technical evaluation of the proposals received, identification of qualified sources, and selection for contract award.
Award shall be made to the qualified proposer whose proposal will be most advantageous to the commission with price and all other factors considered.
If award is not made to the bidder whose proposal contains the lowest price, the commission shall make a finding setting forth the basis for the award.
The commission, at its discretion, may reject any and all proposals and request new proposals.
A person who submits, or who plans to submit, a proposal may protest any acquisition conducted in accordance with this section as follows:
Protests based on the content of the request for proposals shall be filed with the commission within 10 calendar days after the request for proposals is first advertised in accordance with subdivision (c). The commission shall issue a written decision on the protest prior to opening of proposals. A protest may be renewed by refiling the protest with the commission within 15 calendar days after the mailing of the notice of the recommended award.
Any bidder may protest the recommended award on any ground not based upon the content of the request for proposals by filing a protest with the commission within 15 calendar days after the mailing of the notice of the recommended award.
Any protest shall contain a full and complete written statement specifying in detail the grounds of the protest and the facts supporting the protest. Protestors shall have an opportunity to appear and be heard before the commission prior to the opening of proposals in the case of protests based on the content of the request for proposals, or prior to final award in the case of protests based on other grounds or the renewal of protests based on the content of the request for proposals.
Provisions in any contract concerning women and minority business enterprises, which provisions are in accordance with the request for proposals, shall not be subject to negotiation with the successful bidder.
In order to facilitate the participation of minority-owned and women-owned businesses and disadvantaged individuals in activities and contracts of the commission, to the extent that the provisions of Executive Order 11246 of September 24, 1965, as amended, and Chapter 60 (commencing with Section 60.1) of Title 41 and Part 23 (commencing with Section 23.1) of Title 49 of the Code of Federal Regulations are not applicable, the commission has the authority to develop a program to implement similar provisions applicable to its activities and contracts.
“Transit” means as defined in Section 40005.
The Orange County Transportation Authority may acquire, construct, develop, lease, jointly develop, own, operate, maintain, control, use, jointly use, or dispose of rights-of-way, rail lines, monorails, guideways, buslines, stations, platforms, switches, yards, terminals, parking lots, air rights, land rights, development rights, entrances and exits, and any and all other facilities for, incidental to, necessary for, or convenient for transit service, including, but not limited to, facilities and structures physically or functionally related to transit service, within or partly without the county, underground, upon, or above the ground and under, upon or over public streets, highways, bridges, or other public ways or waterways, together with all physical structures necessary for, incidental to, or convenient for the access of persons and vehicles thereto, and may acquire, lease, sell, or otherwise contract with respect to any interest in or rights to the use or joint use of any or all of the foregoing. However, installations on state freeways are subject to the approval of the Department of Transportation and installations in other state highways are subject to Article 2 (commencing with Section 670) of Chapter 3 of Division 1 of the Streets and Highways Code.
With respect to the segment of State Highway Route 91 between State Highway Route 15 and State Highway Route 55 only, the Orange County Transportation Authority may exercise all of the powers contained in paragraph (1) that apply to streets, highways, bridges, and connector roads.
The exercise of the powers provided to the Orange County Transportation Authority in paragraph (2) is subject to approval by the Board of Supervisors of Riverside County and the Riverside County Transportation Commission and in consultation with the advisory committee described in Section 130245 as it relates to the use of those powers in Riverside County under the terms of the franchise agreement described in subdivision (c).
If the Orange County Transportation Authority requests, the department shall approve the assignment to the Orange County Transportation Authority of the Amended and Restated Development Franchise Agreement, as amended, between the department and the California Private Transportation Company, L.P. (CPTC) for the State Highway Route 91 median improvements as authorized by Section 143 of the Streets and Highways Code, subject to the requirement that subdivisions (a) to (f), inclusive, of Section 2 of Article 3 of the restated franchise agreement be deleted in their entirety in the event that CPTC and the authority agree to the assignment of all of CPTC’s interests in the franchise agreement to the authority.
The Orange County Transportation Authority shall have the authority to impose tolls for use of the State Highway Route 91 facilities as authorized by the franchise agreement.
Toll revenues from the use of State Highway Route 91 facilities between State Highway Route 55 and the Orange and Riverside County line shall only be used by the Orange County Transportation Authority for the following expenditures relative to the State Highway Route 91 express lanes and for the purposes of paragraph (2):
Capital, operations, and maintenance, including, but not limited to, toll collection and enforcement.
Repair and rehabilitation.
Payment of purchase costs, debt service, and satisfaction of other covenants and obligations related to indebtedness.
Reserves.
Administration, which shall not exceed 3 percent of toll revenues and associated facility revenues.
Excess toll revenues beyond the expenditure needs of paragraph (1) may be expended for the following purposes:
To enhance transit service designed to reduce traffic congestion on State Highway Route 91 or to expand travel options along the State Highway Route 91 corridor. Revenues expended under this subparagraph may be used to maintain the enhanced transit service. Eligible expenditures include, but are not limited to, transit operating assistance, the acquisition of transit vehicles, improvements to commuter rail traveling between Riverside and Orange Counties, and those transit capital improvements otherwise eligible to be funded under the State Transportation Improvement Program pursuant to Section 164 of the Streets and Highways Code.
To make operational or capacity improvements designed to reduce congestion or improve the flow of traffic on State Highway Route 91. Eligible expenditures may include any phase of project delivery to make capital improvements to onramps, connector roads, roadways, bridges, or other structures that are related to the tolled and nontolled facilities on State Highway Route 91 between State Highway Route 57 to the west and the Orange and Riverside county line to the east.
The Orange County Transportation Authority, in consultation with the department and the Riverside County Transportation Commission, shall issue a plan and a proposed completion schedule for transportation improvements in the State Highway Route 91 corridor. The Orange County Transportation Authority shall update the plan on an annual basis.
The Orange County Transportation Authority may incur indebtedness and obligations, and may issue bonds, refund bonds, and assume existing bonds for purposes authorized by this section. Indebtedness and bonds issued under this section do not constitute a debt or liability of the state or any other public agency, other than the authority, or a pledge of the faith and credit of the state or any other public agency, other than the authority. Bonds issued under this section shall not be deemed to constitute a debt or liability of the state or any political subdivision thereof, other than the bank and the authority, or a pledge of the faith and credit of the state or of any political subdivision, but shall be payable solely from the revenues and assets pledged to the repayment of the bonds. All bonds issued under this section shall contain on the face of the bond a statement to the same effect.
Notwithstanding Section 143 of the Streets and Highways Code, the State Highway Route 91 facility constructed and operated under the authority of a franchise agreement approved pursuant to that section shall revert to the state at the expiration of the lease or termination of the franchise agreement at no cost to the state. Upon reversion, the facility shall be delivered to the department in a condition that meets the performance and maintenance standards established by the department.
The Orange County Transportation Authority shall not impose tolls for the use of nor construct and operate State Highway Route 91 facilities in the County of Riverside without prior approval by the Board of Supervisors of the County of Riverside, the Riverside County Transportation Commission, and the advisory committee.
The Orange County Transportation Authority shall not sell or assign its interest in the franchise agreement without approval by the Legislature by enactment of a statute provided that approval shall not be required in connection with granting rights and remedies to lenders under Article 16 of the restated franchise agreement.
If the Orange County Transportation Authority decides to sell or assign its interest in the franchise agreement, the Orange County Transportation Authority shall provide written notice at least 90 days in advance of the date they submit their request for approval by the department pursuant to this subdivision. The written notice shall be provided to the advisory committee created pursuant to Section 130245 and to the Riverside County Transportation Commission.
The Orange County Transportation Authority shall be authorized to eliminate its rights, interests, and obligations relative to State Highway Route 91 in Riverside County, either by partial assignment to the Riverside County Transportation Commission, or by amendment to the restated franchise agreement, as amended. In the event of a partial assignment or amendment, the department shall consent and the term of the restated franchise agreement, as amended by the partial assignment or amendment, shall be extended to a date determined by the authority, which date shall be no later than December 31, 2065.
If the Riverside County Transportation Commission constructs and operates toll facilities on State Highway Route 91 between the Orange County border and State Highway Route 15, then it is the intent of the Legislature that the Riverside County Transportation Commission and the Orange County Transportation Authority enter into an agreement providing for the coordination of the respective toll facilities operated by each entity on State Highway Route 91.
The Orange County Transportation Authority may enter into agreements for the joint use or joint development of any property or rights by the authority and any city, public agency, or public utility operating transit facilities or nontransit facilities, or both, or any other person, firm, corporation, association, organization, or other entity, public or private, either, in whole or in part, within or outside the county, for the joint use or development of any property of the authority or of the city, public agency, public utility, person, firm, corporation, association, organization, or other entity, public or private, for the establishment of through routes, joint fares, station cost-sharing, connector fees, or land, air, or development rights, sales or leasing, transfer of passengers, pooling arrangements, or for any other purpose necessary for, incidental to, or convenient for the full exercise of the powers granted in this chapter. As to any service which the authority is authorized to perform pursuant to this chapter, the authority may contract for the performance of the service by any city, county, or public utility the territory of which is, in whole or in part, within the county.
“Joint development” includes, but is not limited to, agreements with any person, firm, corporation, association, organization, or other entity, public or private, to develop or to engage in the planning, financing, construction, or operation of authority facilities or development projects adjacent, or physically or functionally related, to authority facilities.
“Nontransit facilities,” as used in this section, includes any land, buildings, or equipment, or interest therein, which is used primarily for the production of transit revenue not arising from the operation of a transit system.
Notwithstanding any other provision of law, the Orange County Transportation Authority may acquire rights-of-way from willing sellers for the following projects:
Addition of auxiliary westbound lane to State Route 91, from Interstate 5 to State Route 57, in Orange County.
State Route 57 northbound widening, from Katella Avenue to Lincoln Avenue, in Orange County.
All the provisions of the Orange County Transit District Act of 1965 (Part 4 (commencing with Section 40000) of Division 10), regarding the powers and functions of the Orange County Transit District shall be equally applicable to the Orange County Transportation Authority as if set forth herein, and shall be in addition to the powers and functions set forth in this division. The authority shall determine which provisions are applicable to the authority.
In addition to the other powers it possesses, the Los Angeles County Metropolitan Transportation Authority may enter into contracts with private entities, the scope of which may combine within a single contract all or some of the planning, design, permitting, development, joint development, construction, construction management, acquisition, leasing, installation, and warranty of all or components of (1) transit systems, including, without limitation, passenger loading or intermodal station facilities, and (2) facilities on real property owned or to be owned by the authority. The authority may solicit or award contracts pursuant to this subdivision after a majority vote of the members of the authority.
A contract awarded pursuant to this section may include operation and maintenance elements, if the inclusion of those elements (1) is necessary, in the reasonable judgment of the authority, to assess vendor representations and warranties, performance guarantees, or life-cycle efficiencies, and (2) does not conflict with collective bargaining agreements to which the authority is a party. The authority may award contracts pursuant to this subdivision after a finding, by a two-thirds vote of the members of the authority, that awarding the contract will achieve for the authority a more competitive solicitation process with respect to quality, timeliness, price, and other private sector efficiencies, relevant to the integration of design, project work, and components.
Any construction, alteration, demolition, repairs, or other works of improvement performed under a contract awarded pursuant to this section shall be considered a public works project subject to Chapter 1 (commencing with Section 1720) of Part 7 of Division 2 of the Labor Code, and shall be enforced by the Department of Industrial Relations in the same way it carries out this responsibility under the Labor Code.
A contract under this section shall be let to the lowest responsible bidder whose bid is responsive to the criteria set forth in the invitation for bids, or, at the authority’s discretion, to a contractor chosen by a competitive bidding process that employs objective selection criteria that may include, but are not limited to, the proposed design approach, features, functions, life-cycle costs, and other criteria deemed appropriate by the authority, in addition to price. Notice requesting bids or proposals shall be published at least once in a newspaper of general circulation. For contracts estimated to exceed ten million dollars ($10,000,000), publication shall be made at least 60 days before the receipt of the bids or price proposals. For contracts estimated not to exceed ten million dollars ($10,000,000), publication shall be made at least 30 days before the receipt of the bids or price proposals. The authority, at its discretion, may reject any and all bids and proposals, and may readvertise. All bids and price proposals submitted pursuant to this section shall be presented under sealed cover and shall be accompanied by one of the following forms of bidder security: (1) cash, (2) a cashier’s check made payable to the authority, (3) a certified check made payable to the authority, or (4) a bidder’s bond executed by an admitted surety insurer, made payable to the authority. Upon an award, the security of each unsuccessful bidder shall be returned in a reasonable period of time, but in no event shall that security be held by the authority beyond 60 days from the time the award is made.
When the design of portions of the project permits the selection of subcontractors, the contractor shall competitively bid those portions. The contractor shall provide to the authority a list of subcontractors whose work is in excess of one-half of 1 percent of the total project cost as soon as the subcontractors are identified. Once listed, the subcontractors shall have the rights provided in the Subletting and Subcontracting Fair Practices Act (Chapter 4 (commencing with Section 4100) of Part 1 of Division 2 of the Public Contract Code).
For the purposes of this section, the following terms shall have the following meanings:
“Authority” means the Orange County Transportation Authority.
“Bonds” means bonds, notes, or other evidences of indebtedness authorized to be issued pursuant to paragraph (4) of subdivision (c).
“Commission” means the Riverside County Transportation Commission.
“Department” means the Department of Transportation.
“Franchise agreement” means the franchise agreement assigned to the authority pursuant to subdivision (c) of Section 130240.
“Transportation facilities” means one or more of the following on State Highway Route 91 between the Orange and Riverside County line to the west and State Highway Route 15 to the east: (A) general purpose toll lanes; (B) lanes or facilities where the tolls may be levied and may vary according to levels of congestion anticipated or experienced or according to the occupancy of the vehicle; and (C) facilities or lanes utilizing combinations of or variations on (A) or (B), or other strategies the commission may determine appropriate on a facility-by-facility basis.
“Transportation project” means the planning, design, development, financing, construction, reconstruction, rehabilitation, improvement, acquisition, lease, operation, or maintenance, or any combination of these, with respect to tolled and nontolled facilities, structures, onramps, connector roads, bridges, and roadways that are on, necessary for, or related to the construction or operation of State Highway Route 91 between the Orange and Riverside County line to the west and State Highway Route 15 to the east.
Pursuant to subdivision (l) of Section 130240, the authority may amend, assign, or terminate the Riverside County portion of the franchise agreement in the interest of advancing the transportation project described in paragraph (7) of subdivision (a). The department, upon request of the authority, shall approve an amendment to the franchise agreement to eliminate any portion of State Highway Route 91 within Riverside County from the franchise agreement.
The commission shall have the authority to set, levy, and collect tolls, user fees, or other similar charges payable for use of the transportation facilities, and any other incidental or related fees or charges, in amounts as required for the following expenditures relative to the transportation facilities as defined in paragraph (6) of subdivision (a) and for purposes of paragraph (2):
Capital outlay, including the costs of design, construction, right-of-way acquisition, and utility adjustment.
Operations and maintenance, including, but not limited to, toll collection and enforcement.
Repair and rehabilitation.
Indebtedness incurred, including related financing costs.
Reserves.
Administration, which shall not exceed 3 percent of toll revenues and associated facility revenues.
Excess toll revenues beyond the expenditure needs of paragraph (1) may be expended for the following purposes:
To enhance transit service designed to reduce traffic congestion on State Highway Route 91 or to expand travel options along the State Highway Route 91 corridor. Revenues expended under this subparagraph may be used to maintain the enhanced transit service. Eligible expenditures include, but are not limited to, transit operating assistance, the acquisition of transit vehicles, improvements to commuter rail traveling between Riverside and Orange Counties, and those transit capital improvements otherwise eligible to be funded under the State Transportation Improvement Program pursuant to Section 164 of the Streets and Highways Code.
To make operational or capacity improvements designed to reduce congestion or improve the flow of traffic on State Highway Route 91. Eligible expenditures may include any phase of project delivery to make capital improvements to onramps, connector roads, roadways, bridges, or other structures that are related to the tolled and nontolled facilities on State Highway Route 91 between the Orange and Riverside county line to the west and State Highway Route 15 to the east.
The commission, in consultation with the authority and the department, shall issue a plan of transportation improvements for the State Highway Route 91 corridor, which shall include projected costs, the use of toll revenues, and a proposed completion schedule. This plan shall be updated annually. The plan and each annual update shall be made available for public review and comment no less than 30 days prior to adoption by the commission.
The commission is authorized to issue bonds to finance the costs of the transportation project, including the costs of issuing the bonds and paying credit enhancement and other fees related to the bonds, which bonds are payable from the tolls authorized pursuant to paragraph (1), sales tax revenues, development impact fees, federal grant funds, or any other source of revenues available to the commission that may be used for these purposes. The bonds may be sold pursuant to the terms and conditions set forth in a resolution adopted by the governing board of the commission. Bonds shall be issued pursuant to a resolution adopted by a two-thirds vote of the commission. Any bond issued pursuant to this paragraph shall contain on its face a statement to the following effect:
“Neither the full faith and credit nor the taxing power of the State of California is pledged to the payment of principal or interest of this bond.”
The department is authorized to enter into any lease, easement, permit, or other agreement with the commission necessary to accomplish the purposes of this section.
The commission shall have the authority to impose tolls for use of the transportation facilities for 50 years following the opening of the transportation facilities for public use, after which time the commission shall have no further authority to impose or to collect a toll for use of transportation facilities on State Highway Route 91, unless reauthorized by the Legislature. The transportation facilities shall revert to the department after the bonds issued pursuant to this section are paid off in their entirety, unless tolls have been reauthorized by the Legislature. Upon reversion, the facilities shall be delivered to the department in a condition that meets the performance and maintenance standards established by the department.
The commission shall make available for public review and comment the toll schedule and any subsequent proposed changes to the schedule no less than 30 days prior to the adoption by the commission of a toll schedule.
This section shall be supplemental and in addition to any other authority of the commission to undertake the transportation project.
This section shall not prevent the department or any local agency from constructing facilities within the State Highway Route 91 corridor that compete with the transportation project, and in no event shall the commission be entitled to compensation for the adverse effects on toll revenues due to those facilities.
If any provision of this section or the application thereof is held invalid, that invalidity shall not affect other provisions or applications of this section that can be given effect without the invalid provision or application, and to this extent the provisions of this section are severable.
This section shall not apply to State Highway Route 91 between the Orange and Riverside County line and State Highway Route 15 unless the authority amends or partially assigns the restated franchise agreement, as amended, between the department and the authority to exclude that portion of State Highway Route 91 from the restated franchise agreement, as amended.
An advisory committee shall be created to review issues and make recommendations to the Orange County Transportation Authority and the Riverside County Transportation Commission regarding the facilities authorized pursuant to Sections 130240 and 130244, including tolls imposed, operations, maintenance, interoperability, and use of toll revenues, and improvements in the State Highway Route 91 corridor, including the identification and siting of alternative highways. The committee shall consist of 10 voting members and three nonvoting members, as follows:
Five members of the Board of Directors of the Orange County Transportation Authority appointed by that board.
Five members of the Riverside County Transportation Commission appointed by that commission.
One member of the San Bernardino Associated Governments appointed by that body, and the district directors of Districts 8 and 12 of the Department of Transportation, all of whom shall be nonvoting members.
The advisory committee shall establish rules for the conduct of committee meetings, which rules shall be approved by both the Orange County Transportation Authority and the Riverside County Transportation Commission. The authority and the commission may appoint alternates to the committee.
When reviewing the initial toll structure proposed by the Orange County Transportation Authority and the Riverside County Transportation Commission or any changes to the toll structure, the advisory committee shall place an information item on a regularly scheduled agenda for public comment and consideration of the advisory committee.
The Orange County Transportation Authority shall conduct an audit on an annual basis of the toll revenues collected and expenditures made during its operation of the facilities authorized in Section 130240. The audit shall review revenues and expenditures related to those facilities for consistency with that section and shall be provided to the advisory committee.
The Riverside County Transportation Commission shall conduct an audit on an annual basis of the toll revenues collected and expenditures made during its operation of the facilities authorized in Section 130244. The audit shall review revenues and expenditures related to those facilities for consistency with that section and shall be provided to the advisory committee.
The Orange County Transportation Authority and the Riverside County Transportation Commission shall equally share all costs associated with this section. None of these costs shall be paid from state funds.
The Riverside County Transportation Commission may enter into contracts with private vendors for the performance of the following services:
Enforcement of parking regulations adopted by the commission. Parking enforcement shall be performed in the manner provided in Article 3 (commencing with Section 40200) of Chapter 1 of Division 17 of the Vehicle Code.
Removal of vehicles parked in violation of a parking regulation adopted by the commission. Removal of vehicles shall be performed in the manner provided in Chapter 10 (commencing with Section 22650) of Division 11 of the Vehicle Code.
ARTICLE 3. Transportation Systems [130250. - 130263.]
The commission shall coordinate the operation of all public transportation services within the county so as to achieve efficient operation thereof and shall resolve all jurisdictional disputes between public transit operators.
It is the intent of the Legislature that, if, at the time the commission commences operation, an application to the federal government has been submitted, or substantial progress has been made in preparation of such an application, for funds to start the necessary work toward the construction of a transit guideway project, the commission shall give top priority to supporting such an effort so that the flow of federal funds shall not be impeded.
All plans proposed for the design, construction, and implementation of public mass transit systems or projects, including exclusive public mass transit guideway systems or projects, and federal-aid and state highway projects, shall be submitted to the commission for approval. No such plan shall be approved unless it conforms to the appropriate adopted regional transportation plan pursuant to Chapter 2.5 (commencing with Section 65080) of Title 7 of the Government Code.
The commission shall have no approval authority over the projects, plans, and programs determined by the Department of Transportation to be necessary for the safety and maintenance of the state highway system. Such projects, plans, and programs shall be developed by the department and, to the extent feasible, be coordinated with the planning of the commission. Plans and programs involving significant rebuilding or rehabilitation of the state highway system, as determined by the department and the commission, shall be developed jointly by the department and the commission.
As used in this section, “plan” means a project description and not the detailed project plans, specifications, and estimates.
Any plan for a transit system proposed to serve more than one county shall also be submitted for approval by the multicounty designated transportation planning agency. Action regarding such approval shall be taken within 60 working days after such a plan is submitted by the commission to the multicounty designated transportation planning agency.
The commission shall designate the operator of any approved transit guideway system.
Except as specified in Section 130254.5, the Los Angeles County Transportation Commission shall designate the Southern California Rapid Transit District as the transit guideway operator in Los Angeles County.
The Orange County Transportation Commission shall designate the Orange County Transit District as the transit guideway operator in Orange County.
The City of Los Angeles may design, construct, and operate a point-to-point transportation system on or between property under the jurisdiction and control of its Department of Airports.
Once constructed and in operation, any such transportation system shall be coordinated with motor vehicle traffic operation and transit services by the county transportation commission having jurisdiction in the county in which the transportation system is located.
With the prior approval of the county transportation commission having such jurisdiction, the City of Los Angeles may submit applications for federal highway or transit funds or state highway or transit funds to construct or operate a point-to-point transportation system on or between property under the jurisdiction and control of its Department of Airports. This requirement shall not apply to any grant of such funds awarded prior to January 1, 1978.
If a commuter or urban rail transit system is proposed to serve two or more counties, the commissions in those counties shall form a joint powers entity to conduct plan refinement studies, design, select the technology, determine the cost, locate the routes and access points, and supervise the construction, operation, and management of the system.
The joint powers entity shall designate the operator of the system.
If state funds are to be used for the operation of the system, at least four months prior to implementing service on the system, the joint powers entity shall submit its plan for the operation to the Legislature.
The commission shall require all planning for guideway and rapid transit systems be coordinated with the Department of Transportation and the multicounty designated transportation planning agency.
The commission may enter into an agreement with the Department of Transportation for the department to provide those services which are within the capabilities of the department to effectively perform in connection with the development and construction of any approved exclusive public mass transit guideway system or rapid transit system.
The commission shall retain final authority to decide those matters for which it is responsible by law pertaining to the planning, design, construction, and operation of any exclusive public mass transit guideway system or rapid transit system.
The department shall perform such services agreed upon in accordance with the law and regulations that are applicable to the commission and the department.
If the Los Angeles County Transportation Commission is authorized to construct a transit guideway system, the commission shall closely coordinate the planning, design, and construction of the system with the Southern California Rapid Transit District, which shall serve as the designated operator of the system pursuant to Section 130254.
Not later than February 1, 1978, the commissions in Riverside County and San Bernardino County shall, and the commissions in Los Angeles County and Orange County may, in cooperation with the Department of Transportation, the multicounty designated transportation planning agency, public transit operators, the county, and the cities involved, establish local transportation zones and adopt guidelines for their establishment and operation.
It is particularly important that the county, cities, and other local public entities be involved in establishing local transportation zones.
In adopting the guidelines, the commission shall take into account, among other things, the geographical shape of proposed local transportation zones, economies of scale of transit systems, and established and projected subregional patterns of travel.
The guidelines shall provide for a method of governing each local transportation zone; shall provide for the establishment of multicounty local transportation zones; and shall authorize each board, under specified conditions, to provide transit services itself, through joint powers agreement or any other cooperative arrangement, or by contract with a public transit operator or a private common carrier.
The Orange County Transportation Commission may establish local transportation zones only in those areas where the commission determines that the Orange County Transit District cannot otherwise provide adequate and responsive local transportation services in a cost-effective manner.
The Los Angeles County Transportation Commission may establish local transportation zones only in those areas where the commission determines by eight affirmative votes of the voting members, or designated alternates, that the Southern California Rapid Transit District or the included municipal operator cannot otherwise provide adequate and responsive local transportation services in a cost-effective manner.
The commission shall require full cooperation and coordination between the regional operator, the municipal operators, and the local transportation zones in such matters as schedules, routes, and exchange of transfers.
The commission shall ensure that regional operators, the municipal operators, and local transportation zones do not compete or unnecessarily duplicate services, but assist each other to provide the maximum level of transit service to the general public at the lowest possible cost.
The Los Angeles County Transportation Commission shall not reduce, by order or by reducing funding, the size of the service areas under the jurisdiction of presently existing included municipal operators (as defined in Section 99207), the level of services they provide, or the scope of their operations, without first consulting with the municipal operators and securing the approval of the municipalities within which they operate.
ARTICLE 4. Smart Freeway Corridor Telecommunications Demonstration Projects [130290. - 130292.]
As used in this article:
“Smart freeway corridor” means a segment of a state highway route in an urban area selected for a smart freeway demonstration project.
“Project” means a demonstration project which applies telecommunications and computer systems to reduce congestion and improve the flow of traffic.
A smart freeway demonstration project shall be comprised of the following elements:
A linked traffic monitoring network of traffic monitoring devices placed in freeway lanes, surface street travel lanes, turn lanes, and on ramps within the freeway corridor to continuously monitor traffic speeds and volumes to identify congestion and traffic incidents.
An interactive signal control system to allow central control personnel or systems to override regular signal cycles in order to expedite traffic flow of congested freeways and surface street intersections and to facilitate the diversion of traffic around congested areas.
A traffic information management system providing commuter access to current traffic information through telephones, radio and television, home computers, terminals in office buildings, in-vehicle motorist information systems, computer-activated changeable message signs placed on freeways, at on ramps, at parking garages, and on major arterials within the freeway corridor.
An improved emergency response system to accelerate the dispatch of emergency vehicles, traffic control officers, and signal maintenance crews, thus reducing the time needed to clear an incident causing traffic congestion.
Tow service to reduce traffic congestion caused by delays in removing stalled or damaged vehicles from the freeway in accordance with plans developed by the Department of the California Highway Patrol in consultation with the Department of Transportation.
A joint-agency data base system to coordinate construction and maintenance which impact traffic flow in the freeway corridor.
The project shall be coordinated by the statutorily created county transportation commission in whose jurisdiction the project is located. The county transportation commission shall consult with local traffic and law enforcement agencies, the Department of Transportation, and the Department of the California Highway Patrol on all aspects of the project in order to provide necessary coordination of the project with existing plans and programs.
The county transportation commission shall make preliminary and final results of the demonstration project available to state and local public agencies for possible application throughout the state.
The county transportation commission shall prepare and transmit to the Legislature, no later than one year after the completion of the project, a report of its findings, conclusions, and recommendations.
The Department of Transportation shall reimburse the county transportation commission, from funds appropriated for projects pursuant to this article, for the costs incurred by the commission under this article.
No money from the General Fund shall be used for the operation of a smart freeway corridor telecommunications project established as a demonstration project pursuant to this article after the demonstration project is completed.
ARTICLE 5. Transportation Planning and Programming [130300. - 130306.]
The Legislature finds and declares:
That the near-term programming and budgeting requirements of state and federal law is a cooperative intergovernmental planning process intended to determine the foreseeable capital and operational needs of a multimodal transportation system.
That there is an absence of an adequate forum in which local officials may exercise leadership in multimodal transportation planning and programming.
Therefore, it is in the public interest to define the roles of various public entities with respect to long-range system planning and short-range capital and service planning and programming processes.
The multicounty designated transportation planning agency which includes the area of the commission shall be responsible for long-range transportation system planning, including preparation of the regional transportation plan as defined in Chapter 2.5 (commencing with Section 65080) of Title 7 of the Government Code in such area.
Such planning shall be directed to, among other things:
Identification of corridors of travel.
Definition of the transportation problems of each corridor.
Definition of the transportation goals for each corridor.
Definition of land use goals, with the concurrence of affected local jurisdictions, that should be supported by transportation investment decisions in each corridor.
Recommendation of priority corridors for major resource allocations.
Recommendation of the mix of alternative transportation modes appropriate for deployment in light of the transportation needs and goals for each corridor.
Recommendation of environmental, economic, energy, and social policies that should guide transportation investment decision within corridors.
Coordination of the plans and short-range transportation improvement programs developed by the commissions, including resolution of conflicts between such plans and programs.
Determination of regional priorities and an annual regional program for the use of federal-aid urban system funds, and funds to be expended pursuant to Section 1604 of Title 49 of the United States Code, based on the priorities of projects appearing in the short-range transportation improvement program adopted by each commission.
Review and comment concerning all near-term transportation improvement programs after the development of, but prior to, adoption of such programs by the commission. The review shall be conducted pursuant to Section 130059 and in such a manner so that it does not unnecessarily slow or impede the transportation planning and programming process.
Development of an annual unified work program for all transportation planning activities within the jurisdiction of the multicounty designated transportation planning agency in cooperation and coordination with the Department of Transportation and the commission and in conformance with federal laws and rules and regulations. Such cooperation and coordination shall specifically apply to the determination of appropriate planning methods for projecting and planning transportation use, and its effect on land use, within the jurisdiction of the agency.
The role of the multicounty designated transportation planning agency, in coordinating, reviewing, and resolving intercommission conflicts, approving multicounty transportation plans, in developing plans and programs, shall be a cooperative effort with the commissions and shall be executed so as not to unnecessarily impede or slow the transportation planning and programming process.
With respect to the area under its jurisdiction, the commission shall be responsible for short-range capital and service planning directed to:
Determination, on an annual basis, of the total amount of funds that could be available to the commission for transportation planning and development.
Development and approval of a short-range three- to five-year transportation improvement program with an annual updated element reflecting all transportation capital and service priorities within the jurisdiction of the commission to be developed with all appropriate coordination and cooperation between the commission and state and local transportation agencies and operators. All projects utilizing federal and state highway and transit funds, and all exclusive public mass transit guideway projects no matter how funded, shall be included in a transportation improvement program adopted by the commission. The program shall also be developed in coordination with the multicounty designated transportation planning agency and the Department of Transportation, shall be consistent with the adopted regional transportation plan, and shall be reviewed and commented on pursuant to subdivision (j) of Section 130301.
Coordination and approval of all public mass transit service within the jurisdiction of the commission and between the jurisdiction of other commissions or transit operators.
Determination or approval of the location and capacity of all capital development projects, including, but not limited to, exclusive public mass transit guideway systems, state highway projects, and federal-aid highway projects.
Selection and specific approval of appropriate mass transit hardware and technology to be funded by the transportation improvement program.
Determination and approval of the staging and scheduling of construction and other development relative to all transportation improvement projects to be funded by the transportation improvement program.
Administration of the countywide program for the expenditure of funds allocated pursuant to Chapter 4 (commencing with Section 99200) of Part 11 of Division 10.
In addition to its short-range transportation planning responsibilities, the commission shall also be responsible, pursuant to Section 180206, for developing long-range expenditure plans for transportation programs included in voter-approved transaction and use tax measures that are consistent with the regional transportation plan and the regional transportation improvement program developed pursuant to Chapter 2.5 (commencing with Section 65080) of Division 1 of Title 7 of the Government Code and this article and Article 3 (commencing with Section 130250) and Article 10 (commencing with Section 130450).
The county transportation commission shall submit the short-range transportation improvement program prepared pursuant to subdivision (b) of Section 130303 to the multicounty designated transportation planning agency. The program shall be the county transportation commission’s recommendation to the agency regarding that portion of the regional transportation improvement program with respect to short-range objectives applicable to the county under the jurisdiction of the county transportation commission. The recommended program shall be submitted to the agency in a timely fashion, and the agency shall review and adopt this portion of the regional transportation improvement program in a timely fashion, giving full explanation for any necessary revision of the county transportation commission’s recommended program.
The multicounty designated transportation planning agency may revise the submitted transportation improvement program in order to resolve conflicts between the recommended programs or with the adopted regional transportation plan. In case of a disagreement as to the resolution of such a conflict between the agency and the involved county transportation commissions, the California Transportation Commission shall resolve the conflict.
The commission shall take all action necessary to obtain the maximum amount of funding available pursuant to Section 1602 of Title 49 of the United States Code. Public transit operators or other public agencies may only apply for such funds under such terms as prescribed by the commission. The commission may authorize the operator or the agency, as the case may be, to be responsible for the administration of its grant on the condition that the commission receives adequate and timely notice of all formal or other significant communications between the operator or agency and the federal government regarding the grant.
The commission shall determine the projects on the federal-aid urban system to be funded. The commission shall determine the projects to be funded pursuant to Sections 1602 and 1604 of Title 49 of the United States Code. The commission shall also determine the program to be funded by funds allocated pursuant to Chapter 4 (commencing with Section 99200) of Part 11 of Division 10.
ARTICLE 6. Transactions and Use Taxes [130350. - 130355.]
A retail transactions and use tax ordinance applicable in the incorporated and unincorporated territory of the County of Los Angeles may be adopted by the Los Angeles County Transportation Commission in accordance with Part 1.6 (commencing with Section 7251) of Division 2 of the Revenue and Taxation Code, provided that two-thirds of the electors voting on the measure vote to authorize its enactment at a special election called for that purpose by the commission.
The Legislature finds and declares all of the following:
In authorizing the Los Angeles County Metropolitan Transportation Authority (MTA) to impose a transaction and use tax pursuant to Section 130350.5, the Legislature intends for the net revenues derived from the tax to be used to fund a transportation investment program that provides mobility, health, and safety benefits to the people residing in all regions of the County of Los Angeles.
For purposes of proposing to the voters of the County of Los Angeles the imposition of a 0.5 percent transaction and use tax at the election held on November 4, 2008, pursuant to subdivision (b) of Section 130350.5, the MTA adopted, on July 24, 2008, a local ordinance that includes as “Attachment A” a plan for the expenditure of the net revenues derived from the imposition of the tax. The adoption of Attachment A constitutes the adoption of an expenditure plan pursuant to subdivision (f) of Section 130350.5.
In addition to the projects and funding amounts identified in paragraph (3) of subdivision (b) of 130350.5, the adopted expenditure plan includes other high-priority projects and funding amounts for the region, including, but not limited to, the following projects:
Green Line Extension to the Los Angeles International Airport– two hundred million dollars ($200,000,000).
Interstate 710 North Gap Closure (tunnel) – seven hundred eighty million dollars ($780,000,000).
Gold Line Eastside Extension – one billion two hundred seventy-one million dollars ($1,271,000,000).
Interstate 605 Corridor “Hot Spot” Interchanges – five hundred ninety million dollars ($590,000,000).
The Legislature finds and declares that all regions of the county stand to benefit from the proposed expenditure plan; therefore, the MTA shall strive to maintain the fair and equitable geographic balance in the plan and shall strive to complete those capital projects as soon as practicable, consistent with the requirements of the proposing ordinance, state and federal law.
Because it is in the interest of the people of the County of Los Angeles and the people of the State of California to ensure that the net revenues derived from the tax imposed pursuant to this act are expended efficiently, and in a manner consistent with the adopted expenditure plan, the MTA shall notify the Legislature prior to the adoption of amendments to the adopted expenditure plan.
In addition to any other tax that it is authorized by law to impose, the Los Angeles County Metropolitan Transportation Authority (MTA) may impose, in compliance with subdivision (b), a transactions and use tax at a rate of 0.5 percent that is applicable in the incorporated and unincorporated areas of the county.
For purposes of the taxing authority set forth in subdivision (a), all of the following apply:
The tax shall be proposed in a transactions and use tax ordinance, that conforms with Chapter 2 (commencing with Section 7261) to Chapter 4 (commencing with Section 7275), inclusive, of the Transactions and Use Tax Law (Part 1.6 (commencing with Section 7251) of Division 2 of the Revenue and Taxation Code), and that is approved by a majority of the entire membership of the authority.
The tax may be imposed only if the proposing ordinance is approved by two-thirds of the voters, in the manner as otherwise required by law, voting on this measure, in an election held on November 4, 2008, or at a subsequent election and, if so approved, shall become operative as provided in Section 130352.
The proposing ordinance shall specify, in addition to the rate of tax and other matters as required by the Transactions and Use Tax Law, that the net revenues derived from the tax are to be administered by the MTA as provided in this section. Net revenues shall be defined as all revenues derived from the tax less any refunds, costs of administration by the State Board of Equalization, and costs of administration by the MTA. Such costs of administration by the MTA shall not exceed 1.5 percent of the revenues derived from the tax. The MTA shall, during the period in which the ordinance is operative, allocate 20 percent of all net revenues derived from the tax for bus operations to all eligible and included municipal transit operators in the County of Los Angeles and to the MTA, in accordance with Section 99285. However, the allocations to the MTA and eligible and included municipal operators shall be made solely from revenues derived from a tax imposed pursuant to this section, and not from local discretionary sources. Funds allocated by MTA to itself pursuant to this section shall be used for transit operations and shall not supplant funds from any other source allocated by MTA to itself for public transit operations. Funds allocated by MTA to the eligible and included municipal operators pursuant to this section shall be used for transit operations and shall not supplant any funds authorized by other provisions of law and allocated by MTA to the eligible and included municipal operators for public transit. In addition to this amount, the MTA shall allocate 5 percent of all net revenues derived from the tax, for rail operations. The MTA shall include the projects and programs described in subparagraphs (A) and (B) in the expenditure plan required under subdivision (f). The MTA shall include all projects and programs described in the expenditure plan required under subdivision (f) in its Long Range Transportation Plan (LRTP). The priorities for projects and programs described in subparagraphs (A) and (B) and in the expenditure plan required under subdivision (f) shall be those set forth in the expenditure plan. The funding amounts specified in subparagraphs (A) and (B) are minimum amounts that shall be allocated by the MTA from the net revenues derived from a tax imposed pursuant to this section. Nothing in this section prohibits the MTA from allocating additional net revenues derived from the tax to these projects and programs.
Capital Projects.
Exposition Boulevard Light Rail Transit Project from downtown Los Angeles to Santa Monica. The sum of nine hundred twenty-five million dollars ($925,000,000).
Crenshaw Transit Corridor from Wilshire Boulevard to Los Angeles International Airport along Crenshaw Boulevard. The sum of two hundred thirty-five million five hundred thousand dollars ($235,500,000).
San Fernando Valley North-South Rapidways. The sum of one hundred million five hundred thousand dollars ($100,500,000).
Metro Gold Line (Pasadena to Claremont) Light Rail Transit Extension. The sum of seven hundred thirty-five million dollars ($735,000,000).
Metro Regional Connector. The sum of one hundred sixty million dollars ($160,000,000).
Metro Westside Subway Extension. The sum of nine hundred million dollars ($900,000,000).
State Highway Route 5 Carmenita Road Interchange Improvement. The sum of one hundred thirty-eight million dollars ($138,000,000).
State Highway Route 5 Capacity Enhancement (State Highway Route 134 to State Highway Route 170, including access improvement for Empire Avenue). The sum of two hundred seventy-one million five hundred thousand dollars ($271,500,000).
State Highway Route 5 Capacity Enhancement (State Highway Route 605 to the Orange County line, including improvements to the Valley View Interchange). The sum of two hundred sixty-four million eight hundred thousand dollars ($264,800,000).
State Highway Route 5/State Highway Route 14 Capacity Enhancement. The sum of ninety million eight hundred thousand dollars ($90,800,000).
Capital Project Contingency Fund. The sum of one hundred seventy-three million dollars ($173,000,000).
Capital Programs.
Alameda Corridor East Grade Separations. The sum of two hundred million dollars ($200,000,000).
MTA and Municipal Regional Clean Fuel Bus Capital (Facilities and Rolling Stock). The sum of one hundred fifty million dollars ($150,000,000).
Countywide Soundwall Construction (MTA Regional List and Monterey Park/State Highway Route 60). The sum of two hundred fifty million dollars ($250,000,000).
Local return for major street resurfacing, rehabilitation, and reconstruction. The sum of two hundred fifty million dollars ($250,000,000).
Metrolink Capital Improvements. The sum of seventy million dollars ($70,000,000).
Eastside Light Rail Access. The sum of thirty million dollars ($30,000,000).
The MTA may incur bonded indebtedness payable from the proceeds of the tax provided by this section pursuant to the bond issuance provisions of Chapter 5 (commencing with Section 130500) and any successor act. The MTA shall include in the expenditure plan, required under subdivision (f), the amount of net revenue specified for all projects and programs in subparagraphs (A) and (B) of paragraph (3) of subdivision (b) as a condition of the use and expenditure of the proceeds of the tax. The MTA shall maintain the current amount of any funding for the projects and programs specified in this section that has been previously programmed or received from sources other than the proceeds of the tax, and may not reallocate money that has been previously programmed or received for those projects and programs to other projects or uses.
Notwithstanding Section 7251.1 of the Revenue and Taxation Code, the tax rate authorized by this section shall not be considered for purposes of the combined rate limit established by that section.
A jurisdiction or recipient is eligible to receive funds from the local return program, described in clause (iv) of subparagraph (B) of paragraph (3) of subdivision (b), only if it continues to contribute to that program an amount that is equal to its existing commitment of local funds or other available funds. The MTA may develop guidelines that, at a minimum, specify maintenance of effort requirements for the local return program, matching funds, and administrative requirements for the recipients of revenue derived from the tax.
Prior to submitting the ordinance to the voters, the MTA shall adopt an expenditure plan for the net revenues derived from the tax. The expenditure plan shall include, in addition to other projects and programs identified by the MTA, the specified projects and programs listed in paragraph (3) of subdivision (b), the estimated total cost for each project and program, funds other than the tax revenues that the MTA anticipates will be expended on the projects and programs, and the schedule during which the MTA anticipates funds will be available for each project and program. The MTA shall also identify in its expenditure plan the expected completion dates for each project described in subparagraph (A) of paragraph (3) of subdivision (b). To be eligible to receive revenues derived from the tax, an agency sponsoring a capital project or capital program shall submit to the MTA an expenditure plan for its project or program containing the same elements as the expenditure plan that MTA is required by this subdivision to prepare.
The MTA shall establish and administer a sales tax revenue fund. The net revenue derived from the tax, after payment of any debt services and related obligations, shall be credited to this fund. The moneys in the fund shall be available to the MTA to meet expenditure and cashflow needs of the projects and programs described in the expenditure plan required under subdivision (f). In the event that there are net revenues in excess of the amount necessary to provide the amount of net revenues specified in the expenditure plan for the projects and programs described therein, the MTA may expend the excess net revenues on projects and programs in the expenditure plan or the LRTP. In the event that projects and programs in the expenditure plan are completed without the expenditure of the amount of net revenues specified, the MTA shall expend the excess net revenues on projects and programs in the expenditure plan or the LRTP within the same subregion as the project or program that is completed. For the purposes of this section, “subregion” shall be defined in the LRTP.
If other funds become available and are allocated to provide all or a portion of the amount of net revenues specified in the expenditure plan for the projects or programs described therein, the MTA may expend the surplus net revenues on other projects and programs in the expenditure plan or the LRTP.
Notwithstanding subdivision (h), if a capital project or capital program described in clauses (i) to (x), inclusive, of subparagraph (A) of paragraph (3) of subdivision (b) and clauses (i) and (vi) of subparagraph (B) of paragraph (3) of subdivision (b), has been fully funded from other sources on or before December 31, 2008, the funds designated to the project or program in clauses (i) to (x), inclusive, of subparagraph (A) of paragraph (3) of subdivision (b) and clauses (i) and (vi) of subparagraph (B) of paragraph (3) of subdivision (b) shall remain in the subregion in which the project or program is located and shall be allocated to other projects or programs in the subregion prior to the expiration of the tax.
A capital project or capital program funded with reallocated funds pursuant to paragraph (1) shall be included in the adopted 2008 Long Range Transportation Plan or the successor plan and shall be of regional significance as determined by the MTA. For purposes of this subdivision, “subregions” means the subregions as defined in the LRTP in effect as of January 1, 2008.
Notwithstanding Section 130354, revenues raised under this section may be used to facilitate the transportation of people and goods within Los Angeles County. The use of the revenues shall not be limited to public transit purposes.
No later than 365 days prior to the adoption of an amendment described in paragraph (1) to an expenditure plan adopted pursuant to subdivision (f), including, but not limited to, the expenditure plan adopted by the MTA board as “Attachment A” in Ordinance #08-01 adopted by the board on July 24, 2008, and in addition to any other notice requirements in the proposing ordinance, the board shall notify the Members of the Legislature representing the County of Los Angeles of all of the following:
A description of the proposed amendments to the adopted expenditure plan that would do any of the following:
Affect the amount of net revenues derived from the tax imposed pursuant to this act that is proposed to be expended on a capital project or projects identified in the adopted expenditure plan.
Delay the schedule for the availability of funds proposed to be expended on a capital project or projects identified in the adopted expenditure plan.
Delay the schedule for the estimated or expected completion date of a capital project or projects identified in the adopted expenditure plan.
The reason for the proposed amendment.
The estimated impact the proposed amendment will have on the schedule, cost, scope, or timely availability of funding for the capital project or projects contained in the adopted expenditure plan.
The notification required pursuant to subdivision (k) shall be achieved by resolution adopted by the MTA board.
The MTA board shall provide prior written notice to the Members of the Legislature representing the County of Los Angeles of any proposed amendments to the adopted expenditure plan that would accelerate funding for a capital project or projects in the adopted expenditure plan.
The Los Angeles County Metropolitan Transportation Authority (MTA), in addition to any other tax it is authorized to impose or has imposed, may impose a transactions and use tax, for a period to be determined by the MTA, that is applicable in the incorporated and unincorporated areas of Los Angeles County. The rate of tax authorized by this section, when combined with the rate of tax authorized by voter approval of Measure R pursuant to Section 130350.5 during any period when that tax is in effect, and upon the expiration of that tax, shall not exceed 1 percent.
The ordinance imposing the tax shall contain all of the following:
An expenditure plan that lists the transportation projects and programs to be funded from net revenues from the tax. The expenditure plan shall appear in the ordinance as an exhibit. The expenditure plan shall include all of the following:
The most recent cost estimates for each project and program identified in the expenditure plan.
The identification of the accelerated cost, if applicable, for each project and program in the expenditure plan.
The approximate schedule during which the MTA anticipates funds will be available for each project and program.
The expected completion dates for each project and program within a three-year range.
Provisions conforming to the Transactions and Use Tax Law (Part 1.6 (commencing with Section 7251) of Division 2 of the Revenue and Taxation Code), except as otherwise provided in subdivision (f).
A provision limiting the MTA’s costs of administering the ordinance and the net revenues from the tax to 1.5 percent of the total tax revenues.
A requirement that the net revenues from the tax, defined to mean the total tax revenues less any refunds, costs of administration by the State Board of Equalization, and the MTA’s administration costs, shall be used by the MTA to fund transportation projects and programs identified in the expenditure plan.
The rate of the tax.
The MTA shall do both of the following:
The ordinance shall be adopted by the MTA board, which shall also adopt a resolution that submits the ordinance to the voters.
The ordinance shall become operative pursuant to Section 130352 if approved by two-thirds of the voters voting on the measure, pursuant to subdivision (d) of Section 2 of Article XIII C of the California Constitution.
If the voters approve the ordinance authorized by this section, the expenditure plan included as an exhibit to the ordinance pursuant to paragraph (1) of subdivision (b) shall also be included in the revised and updated Long Range Transportation Plan within one year of the date the ordinance takes effect. The revised and updated Long Range Transportation Plan shall also include capital projects and capital programs that are adopted by each subregion that are submitted to the MTA for inclusion in the revised and updated Long Range Transportation Plan, if the cost and schedule details are provided by the subregions, in a manner consistent with the requirements of the plan. Inclusion of a capital project or a capital program in the Long Range Transportation Plan is not a commitment or guarantee that the project or program shall receive any future funding.
For purposes of this subdivision, “subregion” shall have the same meaning as defined in the Long Range Transportation Plan.
The MTA may incur bonded indebtedness payable from the net revenues of the tax pursuant to the bond issuance provisions of Chapter 5 (commencing with Section 130500) and any successor act.
The tax authorized by this section shall be imposed pursuant to the Transactions and Use Tax Law (Part 1.6 (commencing with Section 7251) of Division 2 of the Revenue and Taxation Code), notwithstanding the combined rate limitation in Section 7251.1 of the Revenue and Taxation Code.
The County of Los Angeles shall conduct the special election called by the commission pursuant to Section 130350, and the commission shall reimburse the county for its cost in conducting the special election.
The special election shall be called and conducted in the same manner as provided by law for the conduct of special elections by a county.
Any transactions and use tax ordinance adopted shall be operative on the first day of the first calendar quarter commencing not less than 180 days after adoption of the ordinance.
Repeal of the transactions and use tax ordinance shall not be operative earlier than the first day of the first calendar quarter following the adoption of the ordinance of repeal.
The revenues received by the Los Angeles County Transportation Commission from the imposition of the transactions and use taxes shall be used for public transit purposes.
Any action or proceeding in which the validity of the adoption of the retail transactions and use tax ordinance provided for in this article or any of the proceedings in relation thereto is contested, questioned, or denied, shall be commenced within 90 days after the date this section becomes effective; otherwise, those proceedings, including the adoption and approval of the ordinance, are valid, and in every respect legal and incontestable.
ARTICLE 7. Transit Service Dispute Resolution [130370. - 130373.]
Not later than February 1, 1980, the Los Angeles County Transportation Commission, in cooperation with all the transit operators in the County of Los Angeles, shall prepare and submit, for public review and comments, proposed rules and regulations for the resolution of transit service disputes in the county pursuant to Section 130371.
The commission shall adopt such rules and regulations not later than April 1, 1980, by eight affirmative votes of the voting members, or designated alternates, only after a public hearing held at least 30 days prior to their adoption.
The rules and regulations shall include, but not be limited to, the following:
Criteria to determine the definition and validity of a transit service dispute.
Procedures for the submission of a transit service dispute to the Los Angeles County Transportation Commission.
Information, such as the matter in dispute, to be included in the notice to be sent to the parties in the transit service dispute.
Procedure for mediation prior to a hearing before a transit coordination and service committee.
Appointment, if mediation fails, of a transit coordination and service committee consisting of commission members and alternates to hold a public hearing on the transit service dispute in the locality of the dispute and to make recommendations regarding the dispute to the commission.
Actions the commission may take to resolve the transit service dispute.
The Los Angeles County Transportation Commission shall have sole authority to resolve any transit service dispute between transit operators in the County of Los Angeles, and its decision with respect to such a dispute shall be final and binding pursuant to the rules and regulations adopted by the commission pursuant to Section 130370.
Prior to January 1, 1981, only a transit service dispute submitted by a transit operator in the County of Los Angeles may be resolved by the Los Angeles County Transportation Commission.
ARTICLE 8. Transit Coordination and Service Program [130380. - 130385.]
Prior to October 1, 1980, the Los Angeles County Transportation Commission, in cooperation with all transit operators in the County of Los Angeles, shall prepare and submit to the Legislature, the county and the cities therein, and the Department of Transportation, for review and comment a proposed transit coordination and service program, including but not limited to, the following:
The definition of institutional relationships between all transit operators in the county and the relationship between the commission and the transit operators.
Full analyses and recommended changes regarding the current distribution of all transit services throughout the county, including levels and types of transit service.
Transit-service productivity guidelines and specific steps to be taken to bring existing transit service into conformity with the guidelines.
Financial standards to be met by all transit operators in the county, as well as guidelines for the utilization of all funds available for transit purposes.
Other transit coordination and service issues and actions deemed appropriate by the commission to promote the efficient and effective use of all available transportation resources in the county so as to maximize the quality and quantity of transit service available to the residents of the county.
The Los Angeles County Transportation Commission shall adopt by eight affirmative votes of the voting members, or designated alternates, a transit coordination and service program not later than January 10, 1981, after a public hearing held at least 30 days prior to its adoption.
After April 1, 1981, the Los Angeles County Transportation Commission shall implement the recommendations of the transit coordination and service program, except as otherwise provided in Section 130385.
The Los Angeles County Transportation Commission shall adopt an updated transit coordination and service program not later than January 10, 1983, and biennially thereafter, and may amend the program at such time as it deems appropriate, in order to meet changing conditions in providing and funding transit services in the County of Los Angeles.
The updated transit coordination and service program, and any amendment to the program, shall be adopted by the Los Angeles County Transportation Commission by eight affirmative votes of the voting members or designated alternates.
The proposed updated program or the proposed amendment, as the case may be, shall be available to the public and to all transit operators in the County of Los Angeles for not less than 60 days prior to its adoption.
Any transit operator in the County of Los Angeles which disagrees with any portion of the transit coordination and service program, or any amendment thereto, that impacts its transit services may request the Los Angeles County Transportation Commission to, and the commission shall, resolve the dispute pursuant to Article 7 (commencing with Section 130370).
In such a case, the portion of the program, or amendment thereto, shall not be implemented until the dispute has been resolved and, if necessary, the program or amendment has been revised according to the resolution of the dispute.
ARTICLE 9. Transaction and Use Taxes in the County of Orange [130400. - 130442.]
As used in this article:
“Commission” means the county transportation commission created in Orange County pursuant to Section 130000.
“County” means the County of Orange.
“Transit operations” means all activities related to operating a transit system other than the purchase, construction, and maintenance of equipment, vehicles, and facilities for public transit purposes.
The Legislature, by the enactment of this article, intends the county and cities therein to use any additional funds provided them by this article to supplement existing local revenues being used for public transportation purposes. The county and the cities therein are further encouraged to maintain their existing commitment of local funds for public transportation purposes.
A retail transactions and use tax ordinance applicable in the incorporated and unincorporated territory of the county may be adopted by the commission in accordance with Section 130410 and Part 1.6 (commencing with Section 7251) of Division 2 of the Revenue and Taxation Code, if two-thirds of the electors voting on the measure vote to approve its imposition at a special election called for that purpose by the commission and an expenditure plan is adopted pursuant to Section 130406.
The commission, in the ordinance, shall state the nature of the tax to be imposed, shall provide the tax rate or rates or the maximum tax rate or rates, and shall specify the purposes for which the revenue derived from the tax will be used.
The County of Orange shall conduct the special election called by the commission pursuant to Section 130401, and the commission shall reimburse the county for its cost in conducting the special election.
The special election shall be called and conducted in the same manner as provided by law for the conduct of special elections by a county.
Any transactions and use tax ordinance adopted pursuant to this article shall be operative on the first day of the first calendar quarter commencing more than 120 days after adoption of the ordinance.
Prior to the operative date of the ordinance, the commission shall contract with the State Board of Equalization to perform all functions incident to the administration and operation of the ordinance.
The revenues from the taxes imposed pursuant to this article may be allocated by the commission for public transportation purposes, including, but not limited to, construction, maintenance, and operation of streets, roads, and highways, and the construction and maintenance of public transit systems, including exclusive public mass transit guideway systems, available now or hereafter. The revenues may also be used for improvements to the state highway system in the manner otherwise provided by law. However, the revenues shall not be allocated for transit operations.
If the commission decides to adopt a retail transactions and use tax pursuant to this article, the commission shall review and assess the needs for the public transportation purposes specified in Section 130405. As part of this review and assessment, the commission shall solicit proposals for public transportation purposes from the Department of Transportation, the county, and the cities therein, and all public transit operators within the county. The commission shall adopt a procedure for evaluating these proposals in consultation with the Department of Transportation, the county, and the cities therein, and all public transit operators within the county.
Based on the evaluation, the commission shall prepare a plan for the expenditure of the revenues expected to be derived from the tax provided for in this article, together with other federal, state, and local funds expected to be available for transportation improvements, for a period of 15 years.
The expenditure plan shall include projections of revenues and expenditures for capital, maintenance, and operations purposes for categories of transportation facilities, including, but not limited to, freeways, arterial roads, local streets and roads, and transit.
The commission shall not adopt the expenditure plan until it has received the approval of the board of supervisors and the city councils representing both a majority of the cities in the county and a majority of the population residing in incorporated areas of the county. Before adoption of an expenditure plan, the commission shall also conduct public hearings on that plan.
The expenditure plan shall be finally adopted prior to the call of the election provided for in Section 130401. An amendment to the expenditure plan subject to protest pursuant to paragraph (3) of subdivision (c) of Section 130407 shall be finally adopted by the commission after approval of the board of supervisors and the cities as specified in this section and public hearings on the amendments, and the amendment is effective upon that final adoption by the commission.
The commission may annually review and propose amendments to the expenditure plan adopted pursuant to Section 130406 to provide for the use of additional federal, state, and local funds, to account for unexpected revenues, or to take into consideration unforeseen circumstances.
The commission shall notify the board of supervisors and the city council of each city in the county and provide them with a copy of the proposed amendments.
The proposed amendments shall become effective 45 days after notice is given pursuant to subdivision (b) except as follows:
If the proposed amendment deletes a project which is included in the original adopted expenditure plan and which is located entirely within a city, the proposed amendment shall become effective only if the city council of the affected city, by resolution, concurs with the deletion of the project.
If the proposed amendment deletes a project which is included in the original adopted expenditure plan and which is located entirely in the unincorporated area of the county, the proposed amendment shall become effective only if the board of supervisors, by resolution, concurs with the deletion of the project.
In all cases other than those set forth in paragraphs (1) and (2), the proposed amendment shall become effective unless the board of supervisors, or city councils representing 25 percent of the cities in the county, adopt a resolution protesting the proposed amendments. If protested, the proposed amendments shall become effective only if the commission follows the approval procedure in subdivision (d) of Section 130406.
The expenditure plan adopted pursuant to Section 130406, and any amendment adopted pursuant to Section 130407, shall include a provision for an annual allocation of funds to the county and the cities therein for public transportation purposes.
In making annual allocations to the county and the cities therein, the commission may allocate the proceeds of any limited tax bonds authorized by the voters pursuant to Section 130412.
An amended expenditure plan adopted pursuant to Section 130407 may include a provision to reduce a tax rate to percentages lower than that approved by the voters and may further provide for an increase of the tax rate if it has previously been lowered; but the tax rate may not be increased to a rate above the tax rate approved by the voters. Any revised tax rate may be adopted only if the commission determines, by a two-thirds vote, that the proceeds of the taxes with the altered tax rate will be sufficient to provide for the payment of principal and interest of any limited tax bonds and any other indebtedness incurred by the commission which was to be payable from the proceeds of the retail transactions and use tax.
If a retail transactions and use tax is adopted pursuant to this article, the commission shall prepare and submit a report to the Department of Transportation, to the board of supervisors, to the city council of each city in the county, and to each public transit operator within the county on or before January 1 of the year following the end of the first full fiscal year after the date that the taxes are imposed pursuant to this article and annually thereafter. The report shall evaluate, and report the progress made in, the implementation of the expenditure plan in the preceding fiscal year.
The commission is authorized to impose a maximum tax rate of 1 percent under this article and Part 1.6 (commencing with Section 7251) of Division 2 of the Revenue and Taxation Code, and the commission may state the maximum tax rate in terms of not to exceed 1 percent, or any lesser percentage thereof. The commission shall not levy the tax at a rate other than 1 percent or 34, 12, or 14 of 1 percent, unless specifically authorized by the Legislature.
The commission, in the ordinance, shall provide for limitations upon the time when the tax shall be in effect. Any tax rate or maximum tax rate adopted pursuant to this article, unless otherwise prohibited, may be increased when authorized by the commission by ordinance adopted in the manner and by the vote stated in Section 130401 and approved by a majority of the electors voting on the measure at an election called for that purpose by the commission.
The actual wording of the proposition on any short form of ballot card, label, or other device, regardless of the system of voting used, shall read as follows:
The proposition shall set forth the actual percent of the transactions and use tax upon which the electors are voting.
The sample ballot to be mailed to the voters, under Section 13303 of the Elections Code, shall be the full proposition as set forth in the ordinance calling the election.
The commission may, as part of the same ballot proposition to approve the imposition of a retail transactions and use tax, seek authorization to issue bonds payable solely from the proceeds of the retail transactions and use tax. The maximum bonded indebtedness which may be authorized shall be an amount equal to the sum of the principal and interest on the bonds not to exceed the estimated proceeds of the retail transactions and use tax for a period of 30 years. The actual wording of the proposition on any short form of ballot card, label, or other device, regardless of the system of voting used, shall read as follows:
The commission may further, as part of the same proposition, submit to the voters a proposal to increase any appropriations limits heretofore imposed upon the commission by the amount of the proceeds of the sales tax not entitled to an exemption from those limits as debt service. In this case, the ballot proposition shall, in addition to the language set forth in Sections 130411 and 130412, further include the following words: “and increases the appropriations limit.”
The bonds authorized by the voters concurrently with the approval of the retail transactions and use tax may be issued by the commission at any time, and from time to time, payable solely from the proceeds of the tax. The bonds shall be referred to as “limited tax bonds.”
The pledge of retail transactions and use taxes to the limited tax bonds authorized under this article shall have priority over the use of any of the funds for “pay-as-you-go” financing except to the extent that that priority is expressly restricted in the resolution providing for the issuance of the bonds.
Limited tax bonds shall be issued pursuant to a resolution adopted at any time, and from time to time, by the commission by a two-thirds vote of all members of the commission. Each resolution shall provide for the issuance of bonds in such amounts as the necessity therefor may appear, until the full amount of the bonds authorized shall have been issued. The full amount of bonds may be divided into two or more series and different dates of payment fixed for the bonds of each series. A bond need not mature on its anniversary date.
A resolution providing for the issuance of bonds shall state all of the following:
The purposes for which the proposed debt is to be incurred, which may include all costs and estimated costs incidental to or connected with the accomplishment of those purposes, including, without limitation, engineering, inspection, legal, fiscal agents, financial consultant and other fees, bond and other reserve funds, working capital, bond interest estimated to accrue during the construction period and for a period not to exceed three years thereafter, and expenses of all proceedings for the authorization, issuance, and sale of the bonds.
The estimated cost of accomplishing the purposes.
The amount of the principal of the indebtedness.
The maximum term the bonds, proposed to be issued, shall run before maturity, which shall not exceed 31 years from the date thereof or the date of each series thereof.
The maximum rate of interest to be paid, which shall not exceed the maximum allowable by law.
The denomination or denominations of the bonds, which shall not be less than five thousand dollars ($5,000).
The form of the bonds, including, without limitation, registered bonds and coupon bonds, to the extent permitted by federal law, and the form of any coupons to be attached thereto, the registration, conversion, and exchange privileges, if any, pertaining thereto, and the time when the whole or any part of the principal shall become due and payable.
The resolution may also contain any other matters authorized by this article or any other law.
The bonds shall bear interest at a rate or rates not exceeding the maximum allowable by law, payable semiannually, except that the first interest payable on the bonds or any series thereof may be for any period not exceeding one year as determined by the commission.
In the resolution or resolutions providing for the issuance of the bonds, the commission may also provide for call and redemption of the bonds prior to maturity at such times and prices and upon such other terms as it may specify, provided that no bond shall be subject to call or redemption prior to maturity unless it contains a recital to that effect or unless a statement to that effect is printed thereon.
The principal of and interest on the bonds shall be payable in lawful money of the United States at the office of the treasurer of the County of Orange or at such other place or places as may be designated, or at either place or places at the option of the holders of the bonds.
The bonds, or each series thereof, shall be dated and numbered consecutively and shall be signed by the chairman or vice chairman of the commission and the auditor-controller of the County of Orange, and the official seal of the commission attached. The interest coupons of such bonds shall be signed by the auditor-controller of the County of Orange. All of the signatures and seal may be printed, lithographed, or mechanically reproduced, except that one of the signatures on the bonds shall be manually affixed. If any officer whose signature appears on bonds or coupons ceases to be such an officer before the delivery of the bonds, the officer’s signature is as effective as if the officer had remained in office.
The bonds may be sold as the commission determines by resolution. The commission may sell the bonds at a price below par; provided, however, that the discount on any bonds so sold shall not exceed 5 percent of the par value thereof.
Before selling the bonds, or any part thereof, the commission shall give notice inviting sealed bids in any manner as it may prescribe. If satisfactory bids are received, the bonds offered for sale shall be awarded to the highest responsible bidder. If no bids are received, or if the commission determines that the bids received are not satisfactory as to price or responsibility of the bidders, the commission may reject all bids received, if any, and either readvertise or sell the bonds at private sale.
Delivery of any bonds may be made at any place either inside or outside the state, and the purchase price may be received in cash or bank credits.
All accrued interest and premiums received on the sale of bonds shall be placed in the fund to be used for the payment of principal of and interest on the bonds and the remainder of the proceeds of the bonds shall be placed in the treasury of the commission and applied to secure the bonds or for the purposes for which the debt was incurred; provided, however, that when the purposes have been accomplished, any moneys remaining shall be either (a) transferred to the fund to be used for the payment of principal of and interest on the bonds or (b) placed in a fund to be used for the purchase of outstanding bonds of the commission from time to time in the open market at such prices and in such manner, either at public or private sale or otherwise, as the commission may determine. Bonds so purchased shall be canceled immediately.
The commission may provide for the issuance, sale, or exchange of refunding bonds to redeem or retire any bonds issued by the commission upon the terms, at the times and in the manner which it determines.
Refunding bonds may be issued in a principal amount sufficient to pay all, or any part of, the principal of the outstanding bonds, the premiums, if any, due upon call and redemption thereof prior to maturity, all expenses of the refunding, and either (a) the interest upon the refunding bonds from the date of sale thereof to the date of payment of the bonds to be refunded out of the proceeds of the sale of the refunding bonds, or to the date upon which the bonds to be refunded will be paid pursuant to call or agreement with the holders of such bonds or (b) the interest upon the bonds to be refunded from the date of sale of the refunding bonds to the date of payment of the bonds to be refunded or to the date upon which the bonds to be refunded will be paid pursuant to call or agreement with the holders of the bonds.
The provisions of this article for the issuance and sale of bonds apply to the issuance and sale of refunding bonds.
The commission may borrow money in anticipation of the sale of bonds which have been authorized pursuant to this article, but which have not been sold and delivered, and may issue negotiable bond anticipation notes therefor and may renew the bond anticipation notes from time to time, but the maximum maturity of any bond anticipation notes, including the renewals thereof, shall not exceed five years from the date of delivery of the original bond anticipation notes.
The bond anticipation notes, and the interest thereon, may be paid from any moneys of the commission available therefor, including the revenues from the retail transactions and use taxes imposed pursuant to this article. If not previously otherwise paid, the bond anticipation notes, or any portion thereof, or the interest thereon, shall be paid from the proceeds of the next sale of the bonds of the commission in anticipation of which the notes were issued.
The bond anticipation notes shall not be issued in any amount in excess of the aggregate amount of bonds which the commission has been authorized to issue, less the amount of any bonds of the authorized issue previously sold, and also less the amount of other bond anticipation notes therefor issued and then outstanding. The bond anticipation notes shall be issued and sold in the same manner as the bonds.
The bond anticipation notes and the resolution or resolutions authorizing them may contain any provisions, conditions, or limitations which a resolution of the commission authorizing the issuance of bonds may contain.
Any bonds which shall be issued under the provisions of this article shall be legal investment for all trust funds; for the funds of insurance companies, commercial and savings banks, and trust companies; and for state school funds; and whenever any money or funds may, by any law now or hereafter enacted, be invested in bonds of cities, cities and counties, counties, school districts, or other districts within the state, that money or funds may be invested in the bonds issued under this article, and whenever bonds of cities, cities and counties, counties, school districts, or other districts within this state may, by any law now or hereafter enacted, be used as security for the performance of any act or the deposit of any public moneys, the bonds issued under this article may be so used. The provisions of this article shall be in addition to all other laws relating to legal investments and shall be controlling as the latest expression of the Legislature with respect thereto.
Any action or proceeding wherein the validity of the adoption of the retail transactions and use tax ordinance provided for in this article or the issuance of any bonds thereunder or any of the proceedings in relation thereto is contested, questioned, or denied, shall be commenced within six months from the date of the election at which the ordinance is approved; otherwise, the bonds and all proceedings in relation thereto, including the adoption and approval of the ordinance, shall be held to be valid and in every respect legal and incontestable.
If the measure to adopt the transaction and use tax pursuant to Section 130401 is not submitted to the electors on or before December 31, 1985, then this article shall remain in effect only until January 1, 1986, and as of that date is repealed unless a later enacted statute, which is chaptered before January 1, 1986, repeals or extends that date.
ARTICLE 10. Regional Transit Services Program [130450. - 130455.]
For purposes of this article:
“Commissions” means the county transportation commissions of Los Angeles, Orange, Riverside, and San Bernardino Counties.
“Region” means the multicounty region within the collective jurisdiction of the four commissions.
“Regional transit service” means each existing and planned public transit service, including those which are privately owned and which either receive public funds or are operated under an agreement pursuant to Section 143 of the Streets and Highways Code, whether provided by rail or bus, which operates or is planned for operation between two or more counties within the region.
The commissions shall jointly develop an implementation program for regional transit services. In developing the program, the commissions shall consult with the Southern California Association of Governments, the California Transportation Commission, the Los Angeles-San Diego Rail Corridor Agency, and the South Coast Air Quality Management District.
The program shall include, at a minimum, all of the following:
A system plan and map of all regional transit services.
An implementation plan and schedule to establish each regional transit service not already in existence, including, if appropriate, a schedule of necessary construction and procurement.
A policy and implementation plan for the coordination of technologies, fares, and schedules to maximize the ability and convenience of passengers to transfer among regional transit services and to and from other publicly owned or privately owned mass transit services in each county connecting to the regional transit services.
A program for the operation of regional transit services to provide as efficient and convenient a service as is appropriate.
The program shall consider the specialized transportation needs of elderly and handicapped persons.
The program shall be consistent with and implement the adopted regional transportation plan for the region.
The commissions shall hold a joint public hearing in each county in their jurisdiction on the draft program no earlier than 30 days after the draft has been completed. Following the public hearings, each commission shall adopt the regional transit services program.
The initial regional transit services draft program shall be completed by December 1, 1990. The initial program need not reflect intercounty bus services. The commissions shall, in accordance with this article, prepare, adopt, and implement a revised regional transit services program every two years. Revisions to the program shall include both intercounty rail and bus services.
The adopted program shall serve as the basis for a coordinated application submitted by the commissions for funds allocated by the California Transportation Commission. Nothing in this article precludes a commission from applying for funding prior to the adoption of the initial program.
This article shall become operative only if the Los Angeles County Transportation Commission, the Orange County Transportation Commission, the Riverside County Transportation Commission, and the San Bernardino County Transportation Commission, each adopt a resolution making this article applicable to it, in which case the operative date of this article shall be the date upon which the latest of those resolutions is adopted.
CHAPTER 5. Los Angeles County Transportation Commission Revenue Bond Act [130500. - 130553.]
ARTICLE 1. General Provisions [130500. - 130502.]
This chapter shall be known and may be cited as the Los Angeles County Transportation Commission Revenue Bond Act.
The Legislature finds that alternative methods of financing provided in this chapter are needed to finance the cost of acquiring, constructing, and developing facilities for transit systems in the County of Los Angeles and that these methods will increase economic opportunities, contribute to economic development, be in the public interest and serve a public purpose, and promote the health, safety, and welfare of citizens within the County of Los Angeles.
It is the purpose of this chapter to carry out and make effective the findings of the Legislature and, to that end, to provide an alternative method of financing in acquiring, constructing, or rehabilitating facilities to be used as part of transit systems, all to the mutual benefit of the people of the County of Los Angeles and to protect their health and welfare.
ARTICLE 2. Definitions [130510. - 130519.]
Unless the context otherwise requires, the definitions in this article govern the construction of this chapter.
“Bonds” means indebtedness and securities of any kind or class, including bonds, notes, bond anticipation notes, commercial paper, and other obligations.
“Commission” means the Los Angeles County Transportation Commission created pursuant to Section 130050 and any board, commission, department, or officer succeeding to the functions thereof or to whom the powers conferred upon the commission by this division is granted by law.
“Cost,” as applied to a project or portion thereof financed under this chapter, means all or any part of the cost of construction and acquisition of all real or personal property, rights, rights-of-way, franchises, easements, and interests acquired or used for a project, the cost of demolishing or removing any structures on land so acquired, including the cost of acquiring any land to which the structures may be removed, the cost of all machinery and equipment, vehicles, rolling stock, financing charges, interest prior to, during, and for a period after completion of construction as determined by the commission, provisions for working capital, reserves for principal and interest, and for extensions, enlargements, additions, replacements, renovations, and improvements, the cost of architectural, engineering, financial, and legal services, plans, specifications, estimates, and administrative expenses, and other expenses necessary or incidental to the determination of the feasibility of constructing any project or incidental to the construction, acquisition, or financing of any project.
“Notes” means notes and agreements relating thereto, bond anticipation notes, and commercial paper.
“Transit project” or “project” means real and personal property, including, but not limited to, land, structures and all improvements thereto, works, vehicles, rolling stock, rights-of-way, easements, rail lines, rail beds, stations, platforms, switches, yards, terminals, parking facilities, other facilities adjacent to or nearby rail transit stations which are designed to be used in conjunction with the station, and any and all other facilities or equipment necessary or convenient for the provision of transit service, whether under, on, or above the ground, including public streets, highways, bridges, or other public ways or waterways, together with all physical structures necessary or convenient for the access of persons and vehicles thereto.
“Public agency” means any state agency, department, board, or commission, any county, city, regional agency, district, or other political subdivision.
“Public transit purposes,” as used in this chapter and in Section 130354, includes a pledge of transactions and use tax revenues to secure any bonds issued pursuant to this chapter, the payment or provision for payment of the principal of the bonds and any premium, interest on the bonds, and the costs of issuance of the bonds.
“Revenues” means all rents, receipts, purchase payments, and all other income or receipts derived by the commission, whether from fares, the sale, lease, or other disposition of transit facilities or projects or otherwise, and any income or revenue derived from the investment of any money in any fund or account of the commission.
The “Los Angeles Metro Rail project” means an 18.6 mile rail line and necessary support facilities and equipment as described in the June 1983 Environmental Impact Statement and Environmental Report, Los Angeles Rail Rapid Transit Project, Metro Rail.
The ”initial segment of the Los Angeles Metro Rail project” means that portion of the project which the United States Department of Transportation has approved and committed federal funds for initial construction.
ARTICLE 3. General Powers and Duties [130520. - 130522.]
The commission may incur indebtedness and obligations as provided by this chapter.
The commission may acquire by deed, purchase, lease, contract, gift, devise, or otherwise, any real or personal property, structures, rights, rights-of-way, franchises, easements, air, land, and development rights, and other interests in lands located within this state necessary or convenient for the construction or operation of a project, upon terms and conditions it deems advisable, and to lease, develop, jointly develop, maintain, operate, or dispose of any property, right, or interest in the manner that is necessary or desirable to carry out the objects and purposes of this chapter. Nothing in this chapter provides eminent domain power.
The commission may do all of the following:
Fix, collect, and revise from time to time, rates, rents, fees, fares, and charges for the use of, and for any facilities furnished or to be furnished by, a project or any part thereof, except that no rent, fee, fare, or charge may be imposed on an operator for the use of the facilities used in the operation of its transit guideway system.
Contract with any individual, partnership, association, corporation, or public agency with respect to a project.
Provide and maintain, by contract with any public agency or otherwise, a security force to enforce its regulations, preserve and protect the projects financed pursuant to this chapter, and preserve and protect the public peace, health, and safety with respect to these projects.
ARTICLE 4. Bonds and Notes [130530. - 130545.]
The commission may issue bonds for purposes authorized by this chapter, and to fund or refund them, pursuant to this chapter.
Notwithstanding any other provision of law:
The commission and its revenues are exempt from all taxes on, or measured by, income.
Bonds issued by the commission are exempt from all property taxation, and the interest on the bonds are exempt from all taxes on income.
All property owned by the commission is exempt from property taxes, assessments, and other public charges secured by liens.
The commission may from time to time issue or renew notes in anticipation of the sale of bonds or otherwise. The commission may also issue notes partly to renew notes or to discharge any other outstanding obligation and partly for any other purpose. Notes may be authorized, sold, and delivered in the same manner as bonds. Any resolution of the commission authorizing notes may contain any provision which the commission may include in any resolution authorizing bonds, and the commission may include in the notes any terms, covenants, or conditions which it may include in bonds. Notes shall be paid from any revenues of the commission or other money available therefor and not otherwise pledged, or from the proceeds of the sale of the bonds in anticipation of which the notes were issued, subject to any contractual rights of the holders of any outstanding notes or other obligations.
Except as provided in this subdivision and as may be otherwise expressly provided by the commission, all issues of its bonds are special obligations of the commission payable from any revenues or money of the commission available therefor and not otherwise pledged, subject only to any agreement with the holders of particular bonds pledging any particular revenues or money. However, the commission may not pledge revenues or money from the following sources: federal funds provided under Sections 1602 and 1607a of Title 49 of the United States Code, funds allocated pursuant to subdivisions (a) and (b) of Section 99312 from a state transit assistance fund created pursuant to Section 99313.6, funds allocated from the Transportation Planning and Development Account in the State Transportation Fund, funds subject to Article XIX of the California Constitution, and funds provided pursuant to the Mills-Alquist-Deddeh Act (Chapter 4 (commencing with Section 99200) of Part 11 of Division 10).
The commission may not pledge any of its revenue derived from the retail transactions and use tax which have been allocated to a city pursuant to the ordinance adopted pursuant to Section 130350, unless the city has authorized the pledging of its allocation.
Notwithstanding that the bonds may be payable from a special fund, they are for all purposes negotiable instruments, subject only to the provisions of the bonds for registration.
The bonds may be issued as serial bonds or as term bonds, or the commission, in its discretion, may issue bonds of both types.
The bonds shall be authorized by resolution of the commission and shall bear the date or dates, mature at the time or times, not exceeding 50 years from their respective dates, bear interest at the rate or rates, be payable at the time or times, be in the denominations, be in registered form, carry the registration privileges, be executed in the manner, be payable in lawful money of the United States of America at the place or places, and be subject to the terms of redemption, as the resolution or resolutions may provide.
The bonds may be sold at public or private sale, and for the price or prices and on the terms and conditions as determined by the commission.
Pending preparation of the bonds, the commission may issue interim receipts, certificates, or temporary bonds which shall be exchanged for the bonds. The commission may sell any bonds at a price below the par value thereof without any limitation on price.
At times that the commission desires to issue bonds, it shall adopt a resolution specifying the total amount of bonds proposed to be issued.
Any resolution authorizing any bonds, or any issue of bonds, shall, to the extent applicable, contain provisions, which are a part of the contract with the holders of the bonds to be authorized, as to the following:
Pledging all or any part of the revenues of any project or any revenue-producing contract or contracts made by the commission with any individual, partnership, corporation, or association or other body, public or private, or other money of the commission, to secure the payment of the bonds or of any particular issue of bonds, subject to any agreement with bondholders that may then exist.
The rentals, fees, fares, purchase payments, and other charges to be charged, and the amounts to be raised in each year thereby, and the use and disposition of the revenues.
The setting aside of reserves or sinking funds, and the regulation and disposition thereof.
Limitations on the purpose to which the proceeds of sale of any issue of bonds then or thereafter to be issued may be applied, and pledging the proceeds to secure the payment of the bonds or any issue of the bonds.
Limitations on the issuance of additional bonds, the terms upon which additional bonds may be issued and secured and the refunding of outstanding bonds.
The procedure, if any, by which the terms of any contract with bondholders may be amended or abrogated, the amount of bonds that the holders of which are required to consent thereto, and the manner in which the consent may be given.
Limitations on expenditures for operating, administrative, or other expenses of the commission.
Defining the acts or omissions to act which constitute a default in the duties of the commission to bondholders of the commission’s obligations, and providing the rights and remedies of the bondholders in the event of a default.
The mortgaging of any project, or any part thereof, for the purpose of securing the bondholders.
The terms and conditions of the sale, whether public or private, including, but not limited to, the price, interest rates, terms to maturity, security arrangements, and any other terms and conditions which the commission deems necessary under the circumstances.
Neither the members of the commission, nor any person executing the bonds, are liable personally on the bonds, or are subject to any personal liability or accountability by reason of the issuance thereof.
The commission may, from any funds available therefor, purchase its bonds. The commission may hold, pledge, cancel, or resell the bonds, subject to, and in accordance with, agreements with the bondholders.
At the discretion of the commission, any bonds issued under this chapter may be secured by a trust agreement by and between the commission and a trustee, which may be any trust company or bank having the powers of a trust company within or without the state.
The trust agreement, or the resolution providing for the issuance of the bonds, may pledge or assign the revenues to be received or the proceeds of any contract pledged and may convey or mortgage the project, or any portion thereof, to be financed out of the proceeds of the bonds. The trust agreement, or resolution providing for the issuance of the bonds, may contain provisions for protecting and enforcing the rights and remedies of the bondholders as may be reasonable and proper and not in violation of law, including particularly provisions specifically authorized to be included in any resolution of the commission authorizing bonds.
Any bank or trust company which does business under the laws of the United States or of this state, which has its principal place of business in this state, and which may act as depository of the proceeds of bonds or of revenues or other moneys may furnish indemnifying bonds or pledge securities as may be required by the commission.
Any trust agreement may set forth the rights and remedies of the bondholders and of the trustee, and may restrict the individual right of action by bondholders. In addition, any trust agreement or resolution may contain other provisions that the commission may deem reasonable and proper for the security of the bondholders.
The commission shall take no action which will materially impair the security pledged for any bonds which it has previously issued.
All expenses incurred in carrying out the provisions of the trust agreement or resolution may be treated as a part of the cost of the operation of a project.
Bonds issued under this chapter do not constitute a debt or liability of the state or of any other public agency, other than the commission, or a pledge of the faith and credit of the state or of any other public agency, other than the commission, but shall be payable solely from the funds provided therefor. All the bonds shall contain on the face thereof a statement to the following effect:
“Neither the faith and credit nor the taxing power of the State of California or any public agency, other than the Los Angeles County Transportation Commission, is pledged to the payment of the principal of, or interest on, this bond.”
The issuance of bonds under this chapter does not in any manner obligate the state or any other public agency thereof to levy, or to pledge any form of, taxation therefor or to make any appropriation for their payment.
The commission may provide for the issuance of bonds of the commission for the purpose of refunding any bond then outstanding, including the payment of any redemption premium thereon and any interest accrued or to accrue to the earliest or subsequent date of redemption, purchase, or maturity of the bonds and, if deemed advisable by the commission, for the additional purpose of paying all or any part of the cost of constructing and acquiring additions, improvements, extensions, or enlargements of a project or any portion thereof. The commission may issue refunding bonds to refinance its indebtedness only if the commission finds that the refunding is in the public interest due to the terms or conditions of the refunding, including, without limitation, lower net interest cost, maturity or maturities, call provisions, or similar terms and conditions.
The proceeds of any bonds issued for the purpose of refunding outstanding bonds may, in the discretion of the commission, be applied to the purchase or retirement at maturity or redemption of outstanding bonds either on their earliest or any subsequent redemption date or upon the purchase or retirement at the maturity thereof and may, pending such application, be placed in escrow to be applied to the purchase or retirement at maturity or redemption on the date as may be determined by the commission.
Pending that use, the escrowed proceeds may be invested and reinvested by the commission or its trustee in obligations of, or guaranteed by, the United States of America, or in certificates of deposit or time deposits secured by obligations of, or guaranteed by, the United States of America, maturing at a time or times appropriate to ensure the prompt payment of principal, interest, and redemption premium, if any, of the outstanding bonds to be so refunded. The interest, income, and profits, if any, earned or realized on the investment may also be applied to the payment of the outstanding bonds to be so refunded. After the terms of the escrow have been fully satisfied and carried out, any balance of the proceeds and interest, income, and profits, if any, earned or realized on the investments thereof may be returned to the commission for use by it in any lawful manner.
The proceeds of any bonds issued for the additional purpose of paying all or any part of the cost of constructing and acquiring additions, improvements, extensions, or enlargements of a project may be invested and reinvested by the commission or its trustee in obligations of, or guaranteed by, the United States of America, or in certificates of deposit or time deposits secured by obligations of, or guaranteed by, the United States of America, maturing not later than the time or times when the proceeds will be needed for the purpose of paying all or any part of the cost. The interest, income, and profits, if any, earned or realized on the investment may be applied to the payment of all or any part of the cost or may be used by the commission in any lawful manner.
Bonds issued pursuant to Section 130542 are subject to this chapter in the same manner and to the same extent as other bonds issued pursuant to this chapter.
The bonds issued pursuant to this chapter are legal investments for all trust funds, the funds of all insurance companies, commercial or savings banks, trust companies, savings and loan associations, and investment companies, for executors, administrators, guardians, conservators, trustees, and other fiduciaries, for state school funds, and for any funds which may be invested in county, municipal, or school district bonds. The bonds are securities which may properly and legally be deposited with, and received by, any state or municipal officer or any public agency for any purpose for which the deposit of bonds or obligations of the state is now, or may hereafter be, authorized by law, including deposits to secure public funds.
ARTICLE 5. Supplemental Provisions [130550. - 130553.]
This chapter, being necessary for the welfare of the state and its inhabitants, shall be liberally construed to effect the purposes thereof.
This chapter provides a complete, additional, and alternative method for the doing of the things authorized thereby, and is supplemental and additional to powers conferred by other laws.
The issuance of bonds and refunding bonds under this chapter need not comply with the requirements of any other law applicable to the issuance of bonds.
The State of California does hereby pledge to, and agree with, the holders of any bonds issued under this chapter and with those parties who may enter into contracts with the commission pursuant to this chapter that the state will not limit or alter the rights hereby vested in the commission until the bonds, together with the interest thereon, are fully met and discharged and the contracts are fully performed on the part of the commission. However, nothing in this section precludes that limitation or alteration if and when adequate provision has been made by law for the protection of the bondholder or those entering into contracts with the commission.
The commission, as agent for the state for this purpose only, may include this pledge and undertaking for the state in issuing its bonds and entering into contracts.
To the extent that the provisions of this chapter, with respect to the financing of transit systems or facilities, are inconsistent with the provisions of any general statute or special act or parts thereof, with respect to the financing of transit systems or facilities, the provisions of this chapter are controlling. This section does not affect the authority of the Southern California Rapid Transit District to issue bonds, notes, or other evidences of indebtedness under Chapter 7 (commencing with Section 30900) of Part 3 of Division 10 or any other law.
CHAPTER 6. Code of Conduct for the Board of the Los Angeles County Metropolitan Transportation Authority [130600. - 130730.]
For purposes of this chapter, the following definitions apply:
“Board” means the board of directors of the Los Angeles County Metropolitan Transportation Authority.
“Board staff” or “staff” has the same meaning as the term “board staff,” as defined in MTA’s administrative code.
“Gift” has the same meaning as defined in Section 82028 of the Government Code.
“Lobbyist,” “lobbyist employer,” and “lobbying firm,” have the same meanings as defined in Section 130051.18.
“MTA” means the Los Angeles County Metropolitan Transportation Authority.
“MTA contractor” has the same meaning as defined in MTA’s administrative code.
“MTA employee” has the same meaning as defined in MTA’s administrative code.
“MTA proposer” has the same meaning as defined in MTA’s administrative code.
Any reference in this chapter to “chief executive officer,” “general counsel,” “counsel,” “inspector general,” “ethics officer,” “board secretary,” or “secretary” is to the officers of the Los Angeles County Metropolitan Transportation Authority appointed under Sections 130051.9, 130051.28, and 130610.
This chapter, in addition to rules or codes adopted by the board, shall be the code of conduct for the board of the Los Angeles County Metropolitan Transportation Authority.
In addition to any other ethics laws applicable to other public officials, members of the board are also subject to the rules and codes described in subdivision (a).
The board shall appoint an ethics officer, who shall report to the board and operate in an independent manner.
When in doubt as to the applicability of any provision of this chapter to any particular situation, a board member shall contact the general counsel or the ethics officer for advice.
The ethics officer shall interpret relevant authorities and provide advice to the board and MTA relating to codes of conduct, lobbying, governmental ethics, campaign finance, fair procurement practices, and conflicts of interest.
Any advice provided by the ethics officer shall be confidential and entitled to all applicable privileges.
The ethics officer shall propose amendments to codes of conduct that apply to the board, MTA employees, and MTA contractors, when appropriate. The proposed amendments are subject to approval by the board.
The inspector general shall receive any allegation of a violation of this chapter, or other ethics-related rules or laws that apply to the board and MTA.
The inspector general may confer with the ethics officer on any potential violations described in paragraph (1) that may be a violation of this chapter, or other ethics-related rules or laws that apply to the board and MTA.
The ethics officer may make recommendations regarding a potential violation described in paragraph (1) for consideration by the inspector general.
The ethics officer shall be removed from office only if either or both of the following occur:
A two-thirds majority of the members of the board votes for removal.
The ethics officer violates a federal or state law or regulation, a local ordinance, or a policy or practice of the authority, relative to ethical practices, including, but not limited to, the acceptance of gifts or contributions.
This chapter shall be enforced by the inspector general.
Any violation of this chapter that is also a violation of other state law or of local or federal law may also be prosecuted by the appropriate authority.
Upon notice of a possible violation of this chapter, the board shall refer the matter to the inspector general for investigation. Upon completion of the investigation, if the matter has been determined not to be criminal in nature and to be of such a nature that it may be disclosed, the inspector general shall report the findings to the board. If the matter is determined to be criminal in nature, the inspector general shall refer the matter to the appropriate enforcement authorities for prosecution.
A board member or their staff shall not use or threaten to use any official action or authority against, or attempt to interfere with, any person acting in good faith to report or otherwise provide information to MTA regarding any activity that may be a violation of this chapter.
Sanctions for violations of this chapter shall be determined by the board. The sanctions imposed shall depend upon the severity of the infraction and may be progressive unless the violation is determined to be so egregious as to warrant more severe action initially.
The board may consult with the inspector general or the ethics officer for an opinion regarding the sanctions appropriate to any particular violation, provided that a release of confidential information is not required.
Sanctions imposed under this section may include, but are not limited to, any of the following:
Private reprimand by the board.
Public censure by the board at a regularly scheduled meeting.
Disqualification from participating in any discussion or vote on any matter related to the violation.
Removal of the board member from one or more committees for a period of time.
Permanent removal of the board member from one or more committees.
Suspension from all board actions for a period of time.
A monetary fine in an amount determined by the board.
If a board member is criminally indicted, the board member shall be suspended from all board actions for the duration of the criminal proceeding. If the board member is acquitted of the charges, the board member shall return to the board as a full, participating member.
For violations of this chapter that result in findings of criminal or civil liability, the board may recommend additional sanctions to the inspector general after the civil or criminal proceedings are completed.
Confidential information, particularly investigative reports for the inspector general and procurement information, shall not be disclosed beyond the authorized recipient of the report or information.
For purposes of this section, “confidential information” means information that is not subject to disclosure under applicable state law or MTA’s administrative code, or that is otherwise identified as confidential by MTA.
The role of the board as it relates to the MTA is as follows:
The board provides counsel and direction to management and shall not be involved in the day-to-day affairs of the MTA.
Board members do not have individual power or authority over the MTA. That power and decisionmaking authority lie with the full board.
The rules of conduct at board meetings shall be governed by the board’s adopted rules and procedures. Board members shall treat MTA employees and colleagues on the board with respect and courtesy.
Board members shall not engage in personal attacks on MTA employees or attempt to discipline any employee.
Any concerns regarding an employee’s performance shall be communicated to the chief executive officer.
Any concerns regarding the performance of an officer of the board shall be communicated to that officer.
This section does not limit the right of the board to evaluate board officers.
Committee chairs shall present items from their committee meetings and the recommendation of their committee.
All board members shall be afforded an adequate opportunity to review written motions having financial or policy implications before the board meeting.
A written motion having financial or policy implications shall be referred to the appropriate committee for recommendation to the full board, unless the motion is distributed to all board members not later than 48 hours before the board meeting or this requirement is waived by the vote of nine board members.
Board members or their staff are prohibited from soliciting or accepting any gift from a person or entity, including the person’s or entity’s lobbyists, that has submitted a proposal or bid for an MTA contract award during the period beginning on the date that the proposal or bid is submitted and ending 12 months after the final decision on the contract award.
Board members and their staff shall exercise caution in accepting any gift from a person or entity that is considering submitting a proposal or bid for an MTA contract award.
Board members shall not accept gifts aggregating more than ten dollars ($10) in a calendar month from a current MTA contractor, registered lobbyist, lobbying firm, or lobbyist employer.
The payment for, and reimbursement of, board travel shall be governed by applicable state law and MTA’s administrative code.
Board members shall not direct or request that any MTA employee, contractor, or proposer make a charitable contribution.
This section does not prohibit a board member from making a solicitation or request for a charitable contribution if a payment that is made in response to the solicitation or request by the board member would not be considered a behested payment, pursuant to subdivision (c) of Section 82004.5 of the Government Code and related regulations adopted by the Fair Political Practices Commission, if the payment was made at the behest of an elected officer.
This section does not prohibit a board member from making a solicitation or request for a charitable contribution, including a solicitation or request by the board member that results in a reportable behested payment, if the solicitation or request is made to a person other than one identified in subdivision (a).
The chief executive officer shall be responsible for ensuring the MTA has an independent professional procurement staff. The chief executive officer and designated procurement staff shall be responsible for conducting an independent, autonomous procurement process in accordance with state and federal law.
Board members shall use objective judgment in voting on a procurement award and base their decision on the criteria established in the procurement documents.
Board members or their staff shall not attempt to influence contract awards.
During any procurement process, board members or their staff shall not communicate with MTA staff regarding the procurement unless authorized by this chapter, MTA’s administrative code, or MTA procurement policies.
Before the staff recommendation for an award is made public, board members or their staff may communicate with the chief executive officer or the designee of the chief executive officer regarding the procurement, subject to limitations in this chapter, MTA’s administrative code, and MTA procurement policies. Board members and their staff may also communicate with the ethics officer for advice on compliance with this section.
Board members or their staff shall not attempt to obtain or release information about the recommendation of the award of a contract until the recommendation is made public.
Commencing with the issuance of a request for proposal (RFP), request for interest in qualification (RFIQ), or invitation for bid (IFB), and ending on the date of the publicly released, recommended selection of the contractor, a person or entity submitting a proposal in response to the RFP, RFIQ, or IFB, or any officer, employee, representative, agent, or consultant representing the proposer or bidder, shall not contact by any means or engage in any discussion concerning the award of the contract with any board member or their staff. Any contact shall be grounds for the disqualification of the proposer or bidder.
A board member who receives any communication from a proposer or bidder in violation of this chapter shall report that communication to the inspector general.
During the period identified in this section, board members shall not communicate with a proposer or bidder or with any officer, employee, representative, or agent of the proposer or bidder regarding a contract award, protest, or any lawsuit or potential lawsuit regarding the contract award.
Board members or their staff shall not engage in any employment, activity, or enterprise that is inconsistent, incompatible, or in conflict with the duties of an MTA officer.
Board members or their staff shall not use the MTA’s facilities, equipment, supplies, badge, prestige, or influence for personal gain.
Board members and their staff shall refrain from conduct that is likely to create in the minds of reasonable observers the perception that the board member or staff member used their public position improperly.
Board members or their staff shall not make, participate in, or attempt to influence any decision if they are incapable of providing fair treatment to a matter before the board due to bias, prejudice, or because they have prejudged a matter.
The MTA shall not contract with any of the following:
Board members or their staff.
Any profit-making firm or business in which a board member or member of their staff is an officer, principal, partner, or shareholder who owns more than 10 percent of the firm or business.
Former board members or their staff shall not participate in any contract with MTA for a period of 12 months after leaving the board.
For a period of 12 months after the board member has left the board, MTA shall not contract with any profit-making firm or business in which the former board member or member of their staff is an officer, principal, partner, or shareholder who owns more than 10 percent of the firm or business.
Board members shall file Statements of Economic Interest with the ethics officer pursuant to state law, within 30 days of assuming office, annually, and within 30 days of leaving office.
Any amendments to the Statement of Economic Interest shall be filed within 30 days of the occurrence of the change.
Any person who receives compensation to regularly provide advice, recommendations, or counsel to board members regarding MTA activities shall file a Statement of Economic Interest with the MTA within 30 days of the commencement of the consultant relationship. This requirement does not apply to a full-time employee of a governmental entity who is already required to file Statements of Economic Interests with their employing agency.
Any person who provides advice, recommendations, or counsel to board members regarding MTA activities and also advises another public or private entity that has a financial interest in an item before the board shall be prohibited from giving advice to board members and MTA staff regarding that item.
This section shall not prohibit an employee of a public agency from providing advice or recommendations to a board member if the item affects their agency generally and does not involve any direct benefit to the public employee.
CHAPTER 7. San Bernardino County Transportation Authority Consolidation Act of 2017 [130800. - 130828.1.]
This chapter shall be known and may be cited as the San Bernardino County Transportation Authority Consolidation Act of 2017.
For purposes of this chapter, the following definitions shall apply:
“Authority” means the San Bernardino County Transportation Authority established pursuant to Section 130806.
“Local congestion management agency” means a County of San Bernardino congestion management agency established pursuant to subdivision (a) of Section 65089 of the Government Code.
“Local transportation authority” means a County of San Bernardino transportation authority established pursuant to Section 180050.
“San Bernardino Associated Governments” means the joint powers agency established pursuant to the Joint Exercise of Powers Act (Chapter 5 (commencing with Section 6500) of Division 7 of Title 1 of the Government Code).
“San Bernardino County Consolidated Agencies” means the San Bernardino County Transportation Commission established pursuant to Section 130050, the local transportation authority, service authority for freeway emergencies, and local congestion management agency in existence on December 31, 2016, and the San Bernardino Associated Governments when it was acting on behalf of, or in the capacity of, those entities.
“Service authority for freeway emergencies” means a County of San Bernardino service authority for freeway emergencies established pursuant to Section 2551 of the Streets and Highways Code.
There is hereby created the San Bernardino County Transportation Authority. The authority shall be the successor to the powers, duties, revenues, debts, obligations, liabilities, immunities, and exemptions, expressed or implied, of the San Bernardino County Consolidated Agencies.
The San Bernardino County Transportation Commission shall be known as the authority.
The authority may exercise all rights and powers, expressed or implied, including, without limitation, the power to issue bonds, and rely on any immunities or exemptions provided by law to a county transportation commission, a local transportation authority, a service authority for freeway emergencies, or a local congestion management agency.
The authority’s powers include, but are not limited to, the power to do all of the following:
To sue and to be sued.
To acquire any property by any means, and to hold, manage, occupy, develop, jointly develop, dispose of, lease, convey, or otherwise encumber property.
To create a leasehold interest in property for the benefit of the authority.
To acquire, by eminent domain, any property necessary to carry out any of its powers or functions.
To merge or split parcels, adjust boundary lines, or take similar actions as part of the acquisition of land or as needed in order to carry out its functions.
To construct, acquire, develop, jointly develop, maintain, operate, lease, and dispose of work, property, rights-of-way, and facilities.
To appoint necessary employees, including counsel, and to define their qualifications and duties.
To enter into and perform all necessary contracts.
To fix and collect fees for any services rendered by it.
To adopt a seal and alter it.
To adopt an annual budget and to fix the compensation of its officers, board members, and employees.
To establish and enforce rules and regulations for the administration, operation, and maintenance of facilities and services.
To enter into joint powers arrangements with other entities.
To provide insurance.
To issue bonds and incur other obligations.
To advance funds from any sources towards a project in anticipation of future funding sources or contributions from other agencies in order to maximize the efficient delivery of projects undertaken by the authority.
To loan moneys from any of the funds or accounts held by the authority to any other fund or account held by the authority, if all of the following occur:
The loan is authorized pursuant to a resolution of the governing board of the authority.
The authority determines that the loan serves the purposes of the authority.
All moneys loaned to the borrowing fund or account are expended for any of the lawful purposes for which the borrowing account was established.
To do any other things necessary or desirable to carry out the purposes of a county transportation commission, a local transportation authority, a service authority for freeway emergencies, or a local congestion management agency.
The authority may bring an action to determine the validity of its bonds, warrants, contracts, obligations, or evidences of indebtedness issued on or after January 1, 2017, pursuant to Chapter 9 (commencing with Section 860) of Title 10 of Part 2 of the Code of Civil Procedure.
The governing body of the authority shall consist of the following members:
Five members of the San Bernardino County Board of Supervisors.
One member from each County of San Bernardino incorporated city, who shall be a mayor or a city council member.
One nonvoting member appointed by the Governor.
Each County of San Bernardino incorporated city may appoint an alternate member to represent it at a meeting, but only if the regular member cannot attend the meeting. The alternate member shall either be a mayor or a city council member.
Any reference to the San Bernardino County Transportation Commission or to a County of San Bernardino transportation commission, local transportation authority, service authority for freeway emergencies, or local congestion management agency, shall be deemed to refer to the authority.
By operation of law, the authority shall act as and assume the rights, obligations, assets, and liabilities of the San Bernardino County Consolidated Agencies, as established by operation of law or under any contract to which any of them is a party and that was entered into before January 1, 2017. All real and personal property owned by any of the San Bernardino County Consolidated Agencies shall be transferred to the authority by operation of law.
The respective legally enforceable debts and liabilities of the San Bernardino County Consolidated Agencies shall transfer to the authority and exist as debts and liabilities of the authority in the same manner as if the authority had itself incurred them.
The respective rights of creditors and all liens upon the property of the San Bernardino County Consolidated Agencies transferred to the authority, including, without limitation, any pledge of revenues or other collateral securing the repayment of bonds, as those terms are defined in Section 5450 of the Government Code, and the other responsibilities of the San Bernardino County Consolidated Agencies transferred to the authority, shall be preserved unimpaired, and those bonds are the valid obligations of the authority, in each case limited in lien or pledge to the property affected by the liens or pledges immediately prior to the transfer of related responsibilities and obligations.
All powers, duties, debts, obligations, liabilities, or claims arising out of or related to the powers, duties, debts, obligations, and liabilities transferred to the authority under this chapter by operation of law shall be transferred to the authority without further recourse to the San Bernardino Associated Governments or its member agencies, as applicable, and the authority may be proceeded against or substituted in the place of any of the San Bernardino County Consolidated Agencies if the action or proceeding pertains to a transferred power, duty, revenue, debt, obligation, liability, or claim.
In order to protect the holders of outstanding, unmatured bonds and other evidences of indebtedness of the San Bernardino County Consolidated Agencies pertaining to the responsibilities and obligations transferred to the authority, the authority shall have the power to take all actions and do all things necessary or required for the protection of those holders and for compliance with the terms of those bonds and other evidences of indebtedness. The authority shall have the power to continue all services that the San Bernardino County Consolidated Agencies, on the date of the transfer, was furnishing and that pertained to the responsibilities and obligations transferred to the authority.
Chapter 1 (commencing with Section 180000), Chapter 5 (commencing with Section 180200), and, except Section 180260, Chapter 6 (commencing with Section 180250) of Division 19 (commencing with Section 180000) shall be equally applicable to the authority as if set forth herein and shall be in addition to the powers and functions of the authority set forth in this division.
Notwithstanding Section 180260, all proceeds of the authority’s bonds shall be applied to secure the bonds or for the purposes for which the debt was incurred. However, when the purposes have been accomplished, any moneys remaining shall be either transferred to the fund used for the payment of principal of, and interest on, the bonds, or placed in a fund to be used for the purchase of the outstanding bonds in the open market at prices and in the manner, either at public or private sale or otherwise, as determined by the authority. Bonds so purchased shall be canceled immediately.
After the creation of the authority and on the effective date of a resolution of the Board of Retirement of the San Bernardino County Employees’ Retirement Association consenting to membership of the authority’s employees pursuant to subdivision (b) of Section 31557 of the Government Code, all then-current employees of the San Bernardino Associated Governments shall be deemed to be employees of the authority and all duties and obligations of the employment relationship shall be assumed by the authority. The status of each employee deemed to have become an employee of the authority by operation of this section, with respect to membership in the retirement system, shall, in all respects, be as if the employee had remained a member of the retirement system without any break in service or change of employer. The authority shall be deemed a “district” as defined by the County Employees Retirement Law of 1937 (Chapter 3 (commencing with Section 31450) of Part 3 of Division 4 of Title 3 of the Government Code) and shall in all respects assume all of the rights, obligations, and status previously occupied by the San Bernardino Associated Governments as a participating district in the retirement system, including, but not limited to, the payment of employer contributions, the payment of unfunded actuarial liability, the withholding of employee contributions, the reporting of compensation earnable and pensionable compensation, record retention and audit compliance, the enrollment of eligible employees in membership, compliance with restrictions on the employment of retired persons, and the pickup of employee contributions pursuant to Section 414(h)(2) of the Internal Revenue Code (26 U.S.C. 414(h)(2)) and any agreement or resolution implementing the same.
The termination of the San Bernardino Associated Governments’ status as a participating district in the retirement system shall not trigger withdrawal liability pursuant to Section 31564.2 of the Government Code. The authority shall assume the prior obligations of the San Bernardino Associated Governments for the payment of unfunded actuarial liability, which shall continue to be included in contribution rates calculated and approved pursuant to the County Employees Retirement Law of 1937, including, but not limited to, Sections 31453, 31453.5, 31454, 31581, and 31585 of the Government Code, as if no change in the participating employer had occurred.
The authority shall succeed to the rights, duties, and obligations of the San Bernardino Associated Governments with respect to its replacement benefits program pursuant to Chapter 3.9 (commencing with Section 31899) of Part 3 of Division 4 of Title 3 of the Government Code. The rights of each retirement system member to participate in the replacement benefits program, as those rights exist at the time of the transfer of rights, duties, and obligations to the authority, whether the member is actively employed, deferred, or retired, shall continue as if there had been no change in the status of the employer. The transfer of rights, duties, and responsibilities shall not be deemed the creation of a new replacement benefit program, and the continuation of employees’ rights pursuant to the operation of this section shall not be deemed the offering of a new plan to any employee, for purposes of Section 7522.43 and subdivision (c) of Section 31899 of the Government Code.
The authority shall have the power to contract to provide the services of its employees to San Bernardino Associated Governments upon lawful terms and conditions agreed to by the authority and San Bernardino Associated Governments.
Notwithstanding Section 130232, the authority, upon approval of the board of directors, may use the design-build contracting process described in Chapter 4 (commencing with Section 22160) of Part 3 of Division 2 of the Public Contract Code to award a contract for the construction of the Mt. Vernon Avenue Viaduct project in the City of San Bernardino.
For purposes of this section, all references in Chapter 4 (commencing with Section 22160) of Part 3 of Division 2 of the Public Contract Code to “local agency” shall mean the authority and its board of directors.
The following applies to Section 130828:
The Legislature finds and declares that a special statute is necessary and that a general statute cannot be made applicable within the meaning of Section 16 of Article IV of the California Constitution because of the unique and special circumstances surrounding the Mt. Vernon Avenue Viaduct project of the San Bernardino County Transportation Authority and the need to immediately, quickly, and efficiently develop the project.
DIVISION 12.5. COUNTY TRAFFIC AND TRANSPORTATION FUNDING IN THE NINE-COUNTY SAN FRANCISCO BAY AREA [131000. - 131304.]
CHAPTER 1. Definitions and General Provisions [131000. - 131010.]
This chapter shall be known and may be cited as the Bay Area County Traffic and Transportation Funding Act.
The Legislature finds and declares all of the following:
That, in the nine-county San Francisco Bay area, traffic and transportation improvements are an immediate high priority needed to resolve the bay area’s serious traffic congestion and transit mobility problems that threaten the economic viability of the area and adversely impact the quality of life therein.
That, in the nine-county San Francisco Bay area, the Metropolitan Transportation Commission is responsible for regional transportation planning and programming.
That the commission and the counties and cities within the nine-county San Francisco Bay area wish to collectively develop and implement, on a county-by-county basis, near-term local traffic and transportation projects that responsibly and adequately deal with current and anticipated traffic congestion and transit mobility problems.
That, in order to proceed in a expeditious manner with the development and implementation of those projects, each of the nine counties in the San Francisco Bay area should be provided the opportunity to review and determine whether there is a need for the development and implementation of a county transportation expenditure plan that goes significantly beyond current federal, state, and local funding.
Therefore, it is in the public interest to allow the voters in any county in the nine-county San Francisco Bay area to either create a county transportation authority or to authorize the commission to implement a retail transactions and use tax for the purpose of funding a local transportation expenditure plan showing a need for the proceeds from that tax.
This division does not apply to the County of Santa Clara until November 1, 1995.
“City selection committee” means the committee created pursuant to Section 50270 of the Government Code. For purposes of the City and County of San Francisco, the committee means the Mayor of the City and County of San Francisco.
“Commission” means the Metropolitan Transportation Commission.
“County” includes a city and county, and means any of the nine San Francisco Bay area counties listed in Section 66502 of the Government Code.
“Board of supervisors” means the board of supervisors of any of the nine San Francisco Bay area counties listed in Section 66502 of the Government Code.
“County transportation authority” means any authority created pursuant to this division in any of the nine San Francisco Bay area counties listed in Section 66502 of the Government Code.
“Department” means the Department of Transportation.
“Local governments” means the cities within each of the nine San Francisco Bay area counties listed in Section 66502 of the Government Code.
“Sponsoring agency” means a governmental agency, including a county transportation authority, that has transportation responsibilities in the county in which a retail transactions and use tax ordinance has been approved pursuant to this division.
CHAPTER 2. County Transportation Expenditure Plan [131050. - 131057.]
Any board of supervisors which believes its county has essential traffic and transportation projects for which current estimates of federal, state, and local funds may not be adequately available, may establish, on or after January 1, 1986, in conjunction with the city selection committee a process to develop a countywide consensus on the need for these projects and on a proposed county transportation expenditure plan to adequately fund the construction, maintenance, repair, or operation of these projects. The process may include the establishment of a committee or committees as the board of supervisors and the city selection committee deem necessary. The process shall provide for the participation of representatives of cities and the county, representatives of transit agencies serving the county, the department, the commission, and other agencies determined to be necessary by the board of supervisors and the city selection committee. Meetings of any committee established are subject to the Ralph M. Brown Act (Chapter 9 (commencing with Section 54950) of Part 1 of Division 2 of Title 5 of the Government Code). The board of supervisors and the city selection committee may request the commission to provide some staffing assistance. The board of supervisors and the city selection committee shall establish, by resolution, an expected schedule and the process to be used for the completion of the tasks set forth in this chapter.
The county transportation expenditure plan shall consist of all of the following:
A list of essential traffic and transportation projects in the order of priority within the county, and their respective sponsoring agencies, which current estimates of federal, state, and local funds indicate are insufficient to provide for their completion. The types of projects may include, but are not limited to, capital, maintenance, repair, or operation projects. However, no project shall be included that does not have a sponsoring agency. Estimates of federal and state funding shall be based on estimates provided by the staff of the commission. The sponsoring agency shall provide cost estimates for its projects. An agency which administers a retail transactions and use tax ordinance adopted pursuant to this division shall not be a public transit operator. In addition, any state highway project is subject to approval by the department. Any project estimated to have adequate funding shall not be included on the list.
Notwithstanding paragraph (1), funds generated from this division may be used to advance construction to an earlier date for projects contained in the state transportation improvement plan with the concurrence of the county transportation authority, the commission, the California Transportation Commission, and the department.
An estimate of the costs of each of the projects listed in subdivision (a).
An estimate of the current sources of funds available to assist in the completion of each of the projects listed in subdivision (a).
An estimate of the additional amounts of funds to make up the difference between figures in subdivisions (b) and (c) for each of the projects listed in subdivision (a).
A recommendation on whether the adoption of a retail transactions and use tax ordinance would be necessary to fund the projects listed in subdivision (a). If a recommendation is made for the adoption of that ordinance, it shall include a recommendation as to whether the tax shall be permanent or for a specific term. The recommendation shall also address the issue of whether a bonding authority should be sought and on the limitations of that authority.
A recommendation on whether the board of supervisors should request the voters to authorize the creation of a county transportation authority pursuant to this division to impose and administer the proceeds of the tax ordinance recommended in subdivision (e), or whether the board of supervisors should request the commission to impose and administer the proceeds of the tax. The ordinance shall be subject to the approval of a majority of the electors voting on the measure to approve the imposition of the tax.
If the recommendation is for the board of supervisors to ask the voters to request the commission to impose the tax, a recommendation shall be made for the establishment and membership of an advisory committee to advise the commission on the administration of the recommended county transportation expenditure plan.
If the recommendation is for the creation of a county transportation authority, the recommendation shall also include the membership of the authority, specifying the number to represent local governments and the number to represent the county.
A recommendation as to whether to seek the support of adjacent counties for projects that have intercounty impact by requesting the board of supervisors and the city selection committee of each of the adjacent counties to develop a county transportation expenditure plan for their respective county. Adjacent counties shall endeavor to work cooperatively together to develop mutual traffic and transportation projects identified in their respective county transportation expenditure plan.
The recommended county transportation expenditure plan shall be subject to a public hearing and then to a review by the commission, before submittal to the board of supervisors and local governments for adoption.
The commission shall, within 45 days after receipt of a draft county transportation expenditure plan forwarded pursuant to Section 131052, approve the draft plan unless one or more of the following findings is made:
There would be a significant negative regional impact as a result of the proposed projects.
There are insufficient funds available to implement the proposed projects.
Conflicts exist within the county transportation expenditure plan.
The estimates of proceeds from any proposed retail transactions and use tax ordinance are not reasonable.
If the commission rejects a draft county transportation expenditure plan because the draft plan fails to meet the requirements set forth in Section 131053, the commission shall return the draft plan to the county for amendments before resubmittal to the commission for review.
If the commission approves a draft county transportation expenditure plan, the commission shall return the draft plan to the board of supervisors for its approval and to local governments for their approval. A majority of the board of supervisors, and a majority of the local governments representing a majority of the population of the county in the incorporated areas by a majority vote of their respective councils, are required for the adoption of the draft county expenditure plan. The adopted county transportation expenditure plan shall be published by the county within 30 days after its adoption.
Not less than one year prior to the date of the last general election in which a retail transactions and use tax ordinance is in effect pursuant to this division, the commission or the county transportation authority administering the adopted county expenditure transportation plan shall prepare a new draft county transportation expenditure plan for approval pursuant to this chapter.
Upon approval of the draft plan, the board of supervisors shall submit, at the next primary or general election, the question of whether the ordinance shall remain in effect to fund the approved plan.
The commission and any county transportation authority, in administering the adopted county transportation expenditure plan and imposing the retail transactions and use tax, shall have only those powers necessary for those purposes.
The San Mateo County Transportation Authority shall have the power to administer funds transferred to it by the San Mateo County Transit District, consistent with the expenditure plan for a voter-approved tax imposed by the San Mateo County Transit District pursuant to Section 103350.
CHAPTER 3. Retail Transactions and Use Tax [131100. - 131122.]
The Legislature, by the enactment of this chapter intends a county transportation authority or the commission, pursuant to a county transportation expenditure plan adopted pursuant to Section 131055, to use any additional funds provided by this chapter to supplement existing local revenues being used for public transportation purposes listed in the plan. The Legislature further intends that the funds provided pursuant to this chapter shall not replace funds previously provided by property tax revenues for public transportation purposes. The nine-county San Francisco Bay area is further encouraged to maintain its existing commitment of local funds for public transportation purposes.
Any tax revenue generated pursuant to this chapter shall be expended in the county of origin, except that tax revenue generated may be expended within and outside the county of origin if so provided in the adopted county transportation expenditure plan. However, the tax revenues may be exchanged for federal or state funds available to another county or local government for transportation purposes if the exchange will benefit the county of origin.
In order to receive funds from the Counties of Alameda and Contra Costa and the City and County of San Francisco pursuant to this chapter, the San Francisco Bay Area Rapid Transit District shall agree to match from federal, state, or other funds available to the district, at least as much as it receives from the additional funds provided by this chapter from those counties.
The funds the district received pursuant to this chapter, and its matching funds therefor, shall be used only for capital expenditures.
All allocations of revenues derived from the adoption of a retail transactions and use tax ordinance in a county shall be consistent with the priorities established by its county transportation expenditure plan.
A retail transactions and use tax ordinance for a tax of either one-half of 1 percent or 1 percent applicable in the incorporated and unincorporated territory of a county, except as provided in paragraph (2), may be imposed by a county transportation authority or the commission in the manner prescribed in Section 131103 and Part 1.6 (commencing with Section 7251) of Division 2 of the Revenue and Taxation Code, if two-thirds of the electors voting on the measure vote to approve its imposition at an election which shall be called for this purpose by the board of supervisors within one year after the adoption of a county transportation expenditure plan.
The authority to impose a tax under paragraph (1) shall apply to the incorporated and unincorporated territory of the County of San Mateo and the City and County of San Francisco only until December 31, 2025. The elimination of the authority pursuant to this paragraph to impose a tax shall not affect the validity or operation of a tax approved before December 31, 2025, in the incorporated and unincorporated territory of the County of San Mateo or the City and County of San Francisco pursuant to paragraph (1).
Commencing January 1, 2026, a retail transactions and use tax ordinance for a tax of 18 of 1 percent or multiple thereof, up to 1 percent, applicable in the territory of the City and County of San Francisco may be imposed by the county transportation authority or the commission in the manner prescribed in Section 131103 and Part 1.6 (commencing with Section 7251) of Division 2 of the Revenue and Taxation Code, if two-thirds of the electors voting on the measure vote to approve its imposition at an election which shall be called for this purpose by the board of supervisors within one year after the adoption of a county transportation expenditure plan. The combined rate of taxes in the territory of the City and County of San Francisco imposed pursuant to this subdivision and paragraph (1) of subdivision (a) shall not exceed 1 percent.
Commencing January 1, 2026, a retail transactions and use tax ordinance for a tax of 18 of 1 percent or multiple thereof, up to 1 percent, applicable in the incorporated and unincorporated territory of the County of San Mateo may be imposed by the county transportation authority or the commission in the manner prescribed in Section 131103 and Part 1.6 (commencing with Section 7251) of Division 2 of the Revenue and Taxation Code, if two-thirds of the electors voting on the measure vote to approve its imposition at an election which shall be called for this purpose by the board of supervisors within one year after the adoption of a county transportation expenditure plan. The combined rate of taxes in the incorporated and unincorporated territory of the County of San Mateo imposed pursuant to this subdivision and paragraph (1) of subdivision (a) shall not exceed 1 percent.
The ordinance shall take effect at the close of the polls on the day of the election at which the proposition, as set forth in Section 131108, is adopted. The ordinance shall specify the period, as determined by the adopted county transportation expenditure plan during which the tax will be imposed. The tax may be terminated earlier if the projects in the adopted plan are completed and any bonds outstanding issued pursuant to this division are redeemed.
The county, in the retail transactions and use tax ordinance, shall state the nature of the tax to be imposed and shall specify the purposes for which the revenues derived from the tax will be used, and may state the membership of the county transportation authority.
The county shall conduct the election called by the board of supervisors pursuant to Section 131102, and the county shall bear the cost in conducting the election, but shall be reimbursed from the proceeds of the tax by the agency imposing the tax if the tax is approved pursuant to Section 131102.
The election shall be called and conducted in the same manner as provided by law for the conduct of elections by a county.
Any tax ordinance adopted pursuant to this chapter shall be operative on the first day of the first calendar quarter commencing more than 120 days after adoption of the ordinance.
Prior to the operative date of the ordinance, a county transportation authority or the commission, as the case may be, shall contract with the State Board of Equalization to perform all functions incident to the administration and operation of the ordinance.
The net revenues derived from the taxes imposed pursuant to this chapter, after deduction for expenses pursuant to Section 131107, shall be allocated by the agency imposing the tax for the transportation purposes as set forth in the adopted county transportation expenditure plan.
In an adopted county transportation expenditure plan that provides for the imposition of a retail transactions and use tax, not more than 1 percent of the annual net amount of revenues raised by the tax may be used to fund the salaries and benefits of the staff of the commission or the county transportation authority, as the case may be, in administering the plan and the retail transactions and use tax ordinance.
All other funds, after reimbursement to the county for the cost of conducting the election as provided for in Section 131104, shall be used for the planning, design, construction, and operation of the traffic and transportation projects as set forth in the adopted plan, and shall be allocated according to eligible sponsoring agencies.
The board of supervisors, as part of the ballot proposition to approve the imposition of a retail transactions and use tax, may seek authorization to issue bonds as may be provided for in the adopted county transportation expenditure plan payable solely from the proceeds of the tax.
The maximum bonded indebtedness which may be authorized shall be an amount equal to the sum of the principal of, and interest on, the bonds, but not to exceed the estimated proceeds of the tax, as determined by the plan.
The proposition shall set forth the actual percent of the tax.
The proposition shall set forth the duration of the tax if the plan specifies a time limit.
The proposition shall set forth the amount of bonds, if any, payable from the proceeds of the tax.
The proposition shall set forth either a county transportation authority or the commission as the agency imposing the tax.
For an entity formed after 1978 which does not have an appropriations limit, the proposition shall include a limit pursuant to Article XIII B of the Constitution.
The sample ballot to be mailed to the voters, pursuant to Section 13303 of the Elections Code, shall be the full proposition, as set forth in the ordinance calling the election, and the voter information handbook shall include the entire adopted county transportation expenditure plan.
The bonds authorized by the voters concurrently with the approval of the retail transactions and use tax may be issued at any time by the agency imposing the tax and shall be payable solely from the proceeds of the tax. The bonds shall be referred to as “limited tax bonds.”
The pledge of the tax to the limited tax bonds authorized under this chapter shall have priority over the use of any of the tax for “pay-as-you-go” financing, except to the extent that that priority is expressly restricted in the resolution authorizing the issuance of the bonds.
Limited tax bonds shall be issued pursuant to a resolution adopted at any time of a two-thirds vote by the agency imposing the retail transactions and use tax. Each resolution shall provide for the issuance of bonds in the amounts as may be necessary, until the full amount of bonds authorized have been issued. The full amount of bonds may be divided into two or more series and different dates of payment fixed for the bonds of each series. A bond need not mature on its anniversary date.
A resolution authorizing the issuance of bonds shall state all of the following:
The purposes for which the proposed debt is to be incurred, which may include all costs and estimated costs incidental to, or connected with, the accomplishment of those purposes, including, without limitation, engineering, inspection, legal, fiscal agents, financial consultant and other fees, bond and other reserve funds, working capital, bond interest estimated to accrue during the construction period and for a period not to exceed three years thereafter, and expenses of all proceedings for the authorization, issuance, and sale of the bonds.
The estimated cost of accomplishing those purposes.
The amount of the principal of the indebtedness.
The maximum term the bonds proposed to be issued shall run before maturity, which shall not be beyond the date of termination of the imposition of the retail transactions and use tax.
The maximum rate of interest to be paid, which shall not exceed the maximum allowable by law.
The denomination or denominations of the bonds, which shall not be less than five thousand dollars ($5,000).
The form of the bonds, including, without limitation, registered bonds and coupon bonds, to the extent permitted by federal law, and the form of any coupons to be attached thereto, the registration, conversion, and exchange privileges, if any, pertaining thereto, and the time when all of, or any part of, the principal becomes due and payable.
The resolution may also contain any other matters authorized by this chapter or any other law.
The bonds shall bear interest at a rate or rates not exceeding the maximum allowable by law, payable semiannually, except that the first interest payable on the bonds, or any series thereof, may be for any period not exceeding one year, as determined by the agency imposing the retail transactions and use tax.
In the resolution authorizing the issuance of the bonds, the agency imposing the retail transactions and use tax may also provide for the call and redemption of the bonds prior to maturity at the times and prices and upon other terms as specified. However, no bond is subject to call or redemption prior to maturity, unless it contains a recital to that effect or unless a statement to that effect is printed.
The principal of, and interest on, the bonds shall be payable in lawful money of the United States at the office of the treasurer of the agency imposing the retail transactions and use tax, or at other places as may be designated, or at both the office and other places at the option of the holders of the bonds.
The bonds, or each series thereof, shall be dated and numbered consecutively and shall be signed by the chairperson or vice chairperson of the agency imposing the retail transactions and use tax and the auditor-controller of the agency, and the official seal, if any, of the agency shall be attached.
The interest coupons of the bonds shall be signed by the auditor-controller of the agency. All of the signatures and seal may be printed, lithographed, or mechanically reproduced, except that one of the signatures shall be manually affixed.
If any officer whose signature appears on the bonds or coupons ceases to be that officer before the delivery of the bonds, the officer’s signature is as effective as if the officer had remained in office.
The bonds may be sold as the agency imposing the retail transactions and use tax determines by resolution, and the bonds may be sold at a price below par, whether by negotiated or public sale.
Delivery of any bonds may be made at any place either inside or outside the state, and the purchase price may be received in cash or bank credits.
All accrued interest and premiums received on the sale of the bonds shall be placed in the fund to be used for the payment of the principal of, and interest on, the bonds, and the remainder of the proceeds of the bonds shall be placed in the treasury of the agency imposing the retail transactions and use tax and applied to secure the bonds or for the purposes for which the debt was incurred. However, when the purposes have been accomplished, any money remaining shall be either (a) transferred to the fund to be used for the payment of principal of, and interest on, the bonds or (b) placed in a fund to be used for the purchase of the outstanding bonds in the open market at prices and in the manner, either at public or private sale or otherwise, as determined by the agency. Bonds so purchased shall be canceled immediately.
The agency imposing the retail transactions and use tax may provide for the issuance, sale, or exchange of refunding bonds to redeem or retire any bonds issued by the agency upon the terms, at the times and in the manner which it determines.
Refunding bonds may be issued in a principal amount sufficient to pay all, or any part of, the principal of the outstanding bonds, the premiums, if any, due upon call and redemption thereof prior to maturity, all expenses of the refunding, and either of the following:
The interest upon the refunding bonds from the date of sale thereof to the date of payment of the bonds to be refunded out of the proceeds of the sale of the refunding bonds or to the date upon which the bonds to be refunded will be paid pursuant to call or agreement with the holders of the bonds.
The interest upon the bonds to be refunded from the date of sale of the refunding bonds to the date of payment of the bonds to be refunded or to the date upon which the bonds to be refunded will be paid pursuant to call or agreement with the holder of the bonds.
The provisions of this chapter for the issuance and sale of bonds apply to the issuance and sale of refunding bonds.
The agency imposing the retail transactions and use tax may borrow money in anticipation of the sale of bonds which have been authorized pursuant to this chapter, but which have not been sold or delivered, and may issue negotiable bond anticipation notes therefor and may renew the bond anticipation notes from time to time. However, the maximum maturity of any bond anticipation notes, including the renewals thereof, shall not exceed five years from the date of delivery of the original bond anticipation notes.
The bond anticipation notes, and the interest thereon, may be paid from any money of the agency available therefor, including the revenues from the tax. If not previously otherwise paid, the bond anticipation notes, or any portion thereof, or the interest thereon, shall be paid from the proceeds of the next sale of the bonds of the agency in anticipation of which the notes were issued.
The bond anticipation notes shall not be issued in any amount in excess of the aggregate amount of the bonds which the agency has been authorized to issue, less the amount of any bonds of the authorized issue previously sold, and also less the amount of other bond anticipation notes therefor issued and then outstanding. The bond anticipation notes shall be issued and sold in the same manner as the bonds.
The bond anticipation notes and the resolutions authorizing them may contain any provisions, conditions, or limitations which a resolution of the agency may contain.
Any bonds issued under this chapter are legal investment for all trust funds; for the funds of insurance companies, commercial and savings banks, and trust companies; and for state school funds; and whenever any money or funds may, by any law now or hereafter enacted, be invested in bonds of cities, counties, school districts, or other districts within the state, that money or funds may be invested in the bonds issued under this chapter, and whenever bonds of cities, counties, school districts, or other districts within the state may, by any law now or hereafter enacted, be used as security for the performance of any act or the deposit of any public money, the bonds issued under this chapter may be so used. The provisions of this chapter are in addition to all other laws relating to legal investments and shall be controlling as the latest expression of the Legislature with respect thereto.
Any action or proceedings wherein the validity of the adoption of the retail transactions and use tax ordinance provided for in this chapter or the issuance of any bonds thereunder or any of the proceedings in relation thereto is contested, questioned, or denied, shall be commenced within six months from the date of the election at which the ordinance is approved; otherwise, the bonds and all proceedings in relation thereto, including the adoption and approval of the ordinance, shall be held to be valid and in every respect legal and incontestable.
CHAPTER 4. Metropolitan Transportation Commission Administration of Adopted County Transportation Expenditure Plan [131200. - 131203.]
Upon approval of a retail transactions and use tax at an election conducted pursuant to Chapter 3 (commencing with Section 131100) in a county with an adopted county transportation expenditure plan that provides that the commission shall administer the tax, the commission shall do all of the following:
Appoint an advisory committee, as provided in the plan, whose members shall be compensated at the rate of fifty dollars ($50) for attending meetings of the advisory committee, but not to exceed one hundred dollars ($100) in any month, and necessary traveling and personal expenses incurred in the performance of his or her duties as authorized by the commission. Members of the staff of the commission, as determined by the commission, shall be available to assist the advisory committee in its work.
Do any and all things necessary to carry out purposes of this chapter.
The commission, with the advice of the advisory committee, shall determine the allocation of the net revenues derived from the imposition of the retail transactions and use tax in conformance with the adopted county transportation expenditure plan.
The commission shall prepare and adopt an annual report by January 1 of each year on the progress to achieve the objectives of completion of the projects in each county transportation expenditure plan that is administered by the commission.
Any amendment to a county transportation expenditure plan proposed by the commission is subject to approval by the advisory committee. An amendment which adds or deletes a project, or is of major significance, shall be submitted for approval in the same manner the adopted plan was approved pursuant to Chapter 2 (commencing with Section 131050). Amendments may provide for the use of additional federal, state, and local funds to account for unexpected revenue fluctuations or to take into consideration unforeseen circumstances. Any amendment shall take into account that all appropriate actions shall be taken to give highest priority to the projects in the initial plan, and any amendments shall not delay or delete any project in the initial plan without the approval of the project sponsor.
CHAPTER 5. County Transportation Authority [131240. - 131304.]
ARTICLE 1. Creation of a County Transportation Authority [131240. - 131242.]
Upon approval of a retail transactions and use tax at an election conducted pursuant to Chapter 3 (commencing with Section 131100) in a county with an adopted county transportation expenditure plan that includes a provision for the creation of a county transportation authority, the authority shall be created at that election.
The county transportation authority shall consist of the members who are elected officials as specified in the county transportation expenditure plan or in the retail transactions and use tax ordinance, and shall be appointed by each constituent local government within 45 days after the authority is created.
At the first meeting of the county transportation authority, one-half of the members, and the odd-numbered member if the membership of the county transportation authority is odd-numbered, shall be selected by lot to serve terms consisting of the remaining months of the current calendar year, if any, plus two years, and the remaining members shall be selected by lot to serve a term consisting of the remaining months of the current calendar year, if any, plus three years. Thereafter, appointments for all members shall be for two-year terms, beginning on January 1.
If any member or alternate member ceases to be an elected official, that member shall cease to be a member of the county transportation authority, and another member shall be appointed for the remainder of the term by the constituent local government that that member represents.
An alternate may be designated for each regular member. A regular member who, pursuant to the county transportation expenditure plan, serves by virtue of holding a specified public office, may designate a person to serve as his or her alternate. In the case of any other regular member, the appointing constituent local government may designate an alternate to the regular appointed member. The alternate’s term of office shall be the same as that of the regular member. When the regular member is not present at the meeting of the authority, the alternate may act as the regular member and shall have all the rights, privileges, and responsibilities of the regular member.
The Secretary of Transportation shall convene the initial meeting of the county transportation authority at the county seat, within 90 days after the authority is created.
ARTICLE 2. Administration [131260. - 131269.]
A county transportation authority at its first meeting, and thereafter, after the first complete calendar year, annually at the first meeting in January, shall elect a chairperson who shall preside at all meetings, and a vice chairperson who shall preside in his or her absence. In the event of their absence or inability to act, the members present, by an order entered in the minutes, shall select one of their members to act as chairperson pro tempore, who, while so acting, shall have the authority of the chairperson.
The majority of the members of a county transportation authority constitutes a quorum for the transaction of business, and all official acts of the authority require the affirmative vote of a majority of the members of the authority.
The acts of a county transportation authority shall be expressed by motion, resolution, or ordinance.
All meetings of a county transportation authority shall be conducted in the manner prescribed by the Ralph M. Brown Act (Chapter 9 (commencing with Section 54950) of Part 1 of Division 2 of Title 5 of the Government Code).
A county transportation authority shall do all of the following:
Adopt an annual budget and fix the compensation of its officers and employees.
Adopt an administrative code, by ordinance, which prescribes the powers and duties of its officers, the method of appointment of its employees, and its methods, procedures, and systems of operation and management.
Cause a post audit of its financial transactions and records at least annually by a certified public accountant.
Appoint an advisory committee, which membership reflects a board spectrum of interests and geographic areas of the county. Members of the staff of the county transportation authority, as determined by the county transportation authority, shall be available to aid the advisory committee in its work.
Appoint other advisory committees that it deems necessary.
Do any and all things necessary to carry out the purposes of this chapter.
Notice of the time and place of the public hearing for the adoption of the annual budget of a county transportation authority shall be published pursuant to Section 6061 of the Government Code, and shall be published not later than the 15th day prior to the date of the hearing.
The proposed annual budget shall be available for public inspection at least 15 days prior to the hearing.
A county transportation authority may appoint officers that it deems necessary to carry out its duties and functions.
Each member of a county transportation authority shall be compensated at the rate of one hundred dollars ($100) for each day attending the business of the authority, but not to exceed four hundred dollars ($400) in any month, and necessary traveling and personal expenses incurred in the performance of his or her duties as authorized by the county transportation authority.
A county transportation authority may enter into a contract with the Board of Administration of the Public Employees’ Retirement System, and the board may enter into the contract to include all of the employees of the county transportation authority in that retirement system. The employees may be entitled to the same health benefits as are state employees pursuant to Part 5 (commencing with Section 22750) of Division 5 of Title 2 of the Government Code or any other retirement system that the authority determines is in the best interest of its employees.
ARTICLE 3. Powers and Functions [131280. - 131286.]
A county transportation authority shall close its affairs and be terminated within 180 days after the completion of the projects listed in the county transportation expenditure plan and upon retirement of all the bonds authorized to be issued pursuant to this division.
A county transportation authority may sue and be sued, except as otherwise provided by law, in all actions and proceedings, and in all courts and tribunals of competent jurisdiction.
All claims for money or damages against a county transportation authority are governed by Division 3.6 (commencing with Section 810) of Title 1 of the Government Code except as provided therein, or by other statutes or regulations expressly applicable thereto.
A county transportation authority may make contracts and enter into stipulations of any nature to indemnify and hold harmless, to employ labor, and to do all acts necessary and convenient for the full exercise of the powers granted in this chapter.
A county transportation authority may contract with any department or agency of the United States, with any public agency, including but not limited to, the department, the commission, or any transit district, county, or city, or with any person upon terms and conditions that the county transportation authority finds is in its best interest.
Contracts for the purchase of supplies, equipment, and materials in excess of seventy-five thousand dollars ($75,000) shall be awarded to the lowest responsible bidder after competitive bidding, except in an emergency declared by the vote of two-thirds of the voting membership of the county transportation authority.
If, after rejecting bids received under Section 131285, the county transportation authority determines and declares by a two-thirds vote of all of its voting members that, in its opinion, the supplies, equipment, or materials may be purchased at a lower price in the open market, the authority may proceed to purchase these supplies, equipment, or materials in the open market without further observance of the provisions regarding contracts, bids, or advertisement.
ARTICLE 4. Administration of Adopted County Transportation Plan [131300. - 131304.]
The county transportation authority shall administer the county transportation expenditure plan adopted pursuant to Section 131055.
The county transportation authority shall determine the use of the net revenues derived from the imposition of the retail transactions and use tax in conformance with the priorities established in the adopted county transportation expenditure plan.
A county transportation authority shall consult with, and coordinate its actions with, other transportation funding agencies when allocating the net revenues derived from the retail transactions and use tax to the sponsoring agencies of the projects listed in the adopted county transportation expenditure plan.
The county transportation authority shall prepare and adopt an annual report by January 1 of each year on the progress to achieve the objectives of completion of the projects in the adopted county transportation expenditure plan.
Any amendment to a county transportation expenditure plan proposed by the county transportation authority which adds or deletes a project, or is of major significance, shall be submitted for approval in the same manner as the adopted plan was approved pursuant to Chapter 2 (commencing with Section 131050). Amendments may provide for the use of additional federal, state, and local funds to account for expected revenue fluctuations, or to take into consideration unforeseen circumstances. Any amendment shall take into account that all appropriate actions shall be taken to give highest priority to the projects in the initial plan and any amendments shall not delay or delete any project in the initial plan without the approval of the project sponsor.
DIVISION 12.7. COUNTY AND REGIONAL TRANSPORTATION COMMISSIONS [132000. - 132661.]
CHAPTER 2. San Diego County Regional Transportation Commission [132000. - 132334.]
ARTICLE 1. General Provisions, Findings, and Definitions [132000. - 132006.]
This chapter shall be known and may be cited as the San Diego County Regional Transportation Commission Act.
The Legislature hereby finds and declares all of the following:
Recognizing the scarcity of resources available for all transportation development, alternative methods of financing provided in this chapter are needed to finance the cost of maintaining, acquiring, constructing, and developing facilities for transportation systems in the County of San Diego and these methods will increase economic opportunities, contribute to economic development, be in the public interest and serve a public purpose, and promote the health, safety, and welfare of the citizens within the County of San Diego.
It is in the public interest to allow the voters of San Diego County to create the San Diego County Regional Transportation Commission so that local decisions can be implemented in a timely manner to provide improvements to the transportation system.
“Bonds” means indebtedness and securities of any kind or class, including bonds, notes, bond anticipation notes, and commercial paper.
“Commission” means the San Diego County Regional Transportation Commission created pursuant to this chapter in the County of San Diego.
“County” means the County of San Diego.
“San Diego Association of Governments” means the joint powers agency established pursuant to Chapter 5 (commencing with Section 6500) of Division 7 of Title 1 of the Government Code which is the transportation planning agency for the San Diego County region. Any board, commission, department, or officer succeeding to the functions of the association is granted the powers and duties of the association under this chapter.
“Transit development boards” means the San Diego Metropolitan Transit Development Board and the North San Diego County Transit Development Board.
ARTICLE 2. Creation of the Commission [132050. - 132053.]
There is hereby created the San Diego County Regional Transportation Commission in the county.
The Board of Directors of the San Diego Association of Governments shall serve as the San Diego County Regional Transportation Commission.
The commission shall not hire a staff, but shall use the staff of the San Diego Association of Governments and shall compensate the San Diego Association of Governments for the use of staff services as set forth in Section 132103.
On and after a transactions and use tax is imposed pursuant to Article 5 (commencing with Section 132300), the commission may authorize payment from the proceeds of the tax to members of the commission and alternates for serving on the commission. If so authorized, each member of the commission, including alternate members when serving in the absence of a regular member, shall be paid one hundred dollars ($100) for each day the member attends meetings of the commission and committees of the commission, but not to exceed five meetings in any one quarter, and his or her necessary and reasonable expenses in performing his or her duties as a commission member.
ARTICLE 3. Administration [132100. - 132106.]
The joint powers agreement, bylaws, and all rules and regulations of the San Diego Association of Governments shall be the established rules for the proceedings and administration of the commission except as provided otherwise in this chapter.
Meetings of the commission shall be held at least annually and as often as determined necessary by the commission.
The acts of the commission shall be expressed by motion, resolution, or ordinance.
The commission shall expend only that amount of the funds generated pursuant to this chapter for staff support, audit, administrative expenses, and contract services that are necessary and reasonable to carry out its responsibilities pursuant to this chapter.
The commission shall do all of the following:
Adopt an annual budget.
Cause a postaudit of the financial transactions and records of the commission and of all revenues expended pursuant to this chapter to be made at least annually by a certified public accountant.
Do any and all things necessary to carry out the purposes of this chapter.
The commission shall publish, pursuant to Section 6061 of the Government Code, notice of the time and place of the public hearing for the adoption of the annual budget not later than 15 days prior to the date of the hearing.
The proposed annual budget shall be available for public inspection at least 15 days prior to the hearing.
The initial meeting of the commission shall be held in the City of San Diego when called by the Board of Directors of the San Diego Association of Governments in order to approve a transactions and use tax ordinance and ballot proposition and call an election in accordance with Article 5 (commencing with Section 132300).
ARTICLE 4. Powers and Functions [132200. - 132205.]
The commission may adopt a seal and alter it at its pleasure.
The commission may sue and be sued, except as otherwise provided by law, in all actions and proceedings, in all court and tribunals of competent jurisdiction.
All claims for money or damages against the commission are governed by Division 3.6 (commencing with Section 810) of Title 1 of the Government Code except as provided therein, or by other statutes or regulations expressly applicable thereto.
The commission may make contracts and enter into stipulations of any nature whatsoever, including, but not limited to, contracts and stipulations to indemnify and hold harmless, to employ labor, and to do all acts necessary and convenient for the full exercise of the powers granted in this chapter.
The commission may contract with any department or agency of the United States of America, with any public agency, including, but not limited to, the Department of Transportation, the San Diego Association of Governments, or any transit development board, county, or city, or with any person upon any terms and conditions that the commission finds is in its best interest.
The commission may provide and maintain, by contract with a public agency or by other means, a security force to enforce its regulations, preserve and protect any public transit system or project financed pursuant to this chapter, and preserve and protect the public peace, health, and safety with respect to its system or projects.
ARTICLE 5. Transactions and Use Tax [132300. - 132314.]
The Legislature, by the enactment of this article, intends the additional funds provided government agencies by this article to supplement existing local revenues being used for public transportation purposes. The government agencies are further encouraged to maintain their existing commitment of local funds for public transportation purposes.
A retail transactions and use tax ordinance applicable to the entirety of, or a portion of, the incorporated and unincorporated territory of the county shall be imposed by the commission in accordance with Section 132307 and the Transactions and Use Tax Law (Part 1.6 (commencing with Section 7251) of Division 2 of the Revenue and Taxation Code), if two-thirds of the electors voting on the measure within the portion of the county to which the tax would apply, vote to approve its imposition at a special election called for that purpose by the commission. The tax ordinance shall take effect at the close of the polls on the day of election at which the proposition is adopted. The initial collection of the transactions and use tax shall take place in accordance with Section 132304.
If, at any time, the voters do not approve the imposition of the tax, this chapter remains in full force and effect. The commission may, at any time thereafter, submit the same, or a different, measure to the voters in accordance with this chapter.
The portion of the county to which the tax would apply shall be determined by the commission before the electors vote on the measure.
If the tax only applies to a portion of the county, both of the following shall apply:
The incorporated area of each city and of contiguous cities within the county shall be either wholly included within that portion or wholly excluded from that portion. For purposes of this subparagraph, “contiguous cities” means two or more cities with shared borders.
The entire unincorporated area of the commission shall either be wholly included within that portion or wholly excluded from that portion.
The commission shall not enter into a construction contract over one million dollars ($1,000,000) that would be in part or wholly financed through the tax with any entity unless the entity provides to the commission an enforceable commitment that the entity and its subcontractors at every tier will use a skilled and trained workforce to perform all work on the project or a contract that falls within an apprenticeship occupation in the building and construction trades in accordance with Chapter 2.9 (commencing with Section 2600) of Part 1 of Division 2 of the Public Contract Code.
This paragraph shall not apply if any of the following requirements are met:
The commission has entered into a project labor agreement that will bind all contractors and subcontractors performing work on the project.
The commission has contracted to use a skilled and trained workforce and the entity has agreed to be bound by that project labor agreement.
The project or contract is being performed under the extension or renewal of a project labor agreement that was entered into by the commission before January 1, 2019.
The entity has entered into a project labor agreement that will bind the entity and all its subcontractors at every tier performing the project or the entity has contracted to use a skilled and trained workforce.
For purposes of this paragraph, “project labor agreement” has the same meaning as defined in paragraph (1) of subdivision (b) of Section 2500 of the Public Contract Code.
The revenues derived from the tax shall be spent within, or for the benefit of, the portion of the county to which the tax applies, and shall be spent only on transportation and transit infrastructure and services.
Any revenues derived from the tax shall supplement, and not supplant, other transportation revenues available to the portion of the county to which the tax applies.
As used in this section, “commission” shall refer to the consolidated agency if the tax is to be imposed by the consolidated agency pursuant to Section 132360.6.
The commission, in the ordinance, shall state the nature of the tax to be imposed, the tax rate or the maximum tax rate, the purposes for which the revenue derived from the tax will be used, and may set a term during which the tax will be imposed. The purposes for which the tax revenues will be used may include, but are not limited to, the administration of this chapter, including legal actions related thereto, the construction, capital acquisition, maintenance, and operation of streets, roads, and highways, including state highways, and the construction, maintenance, and operation of public transit systems, including exclusive public mass transit guideway systems. These purposes include expenditures for the planning, environmental reviews, engineering and design costs, and related right-of-way acquisition. The ordinance shall contain an expenditure plan which shall include the allocation of revenues for the purposes authorized by this section.
The county shall conduct an election called by the commission pursuant to Section 132301.
The election shall be called and conducted in the same manner as provided by law for the conduct of elections by a county.
Any transactions and use tax ordinance adopted pursuant to this article shall be operative on the first day of the first calendar quarter commencing more than 110 days after adoption of the ordinance.
Prior to the operative date of the ordinance, the commission shall contract with the State Board of Equalization to perform all functions incident to the administration and operation of the ordinance.
The revenues from the taxes imposed pursuant to this article may be allocated by the commission for public transportation purposes consistent with the adopted regional transportation improvement program and the regional transportation plan.
If taxes are imposed pursuant to this article for expenditure for public transit purposes, the commission shall allocate revenues derived therefrom to the transit development boards for allocation within their respective areas of jurisdiction for transit purposes consistent with the adopted regional transportation improvement program and the regional transportation plan.
The commission, subject to the approval of the voters within the portion of the county to which the tax would apply, may impose a maximum tax rate of 1 percent under this chapter and the Transactions and Use Tax Law (Part 1.6 (commencing with Section 7251) of Division 2 of the Revenue and Taxation Code), and the commission may state the maximum tax rate in terms of not to exceed 1 percent, or any lesser percentage thereof. The commission shall not levy the tax at a rate other than 1 percent or three-fourths, one-half, or one-fourth of 1 percent, unless specifically authorized by the Legislature.
The tax rate adopted pursuant to this article, unless otherwise prohibited, may be increased by the commission by ordinance adopted in the manner and by the vote stated in Section 132301 and approved by a majority of the electors voting on the measure at an election called for that purpose by the commission.
The commission may reduce a tax rate to percentages lower than that approved by the voters and may further provide for an increase of the tax rate if it has previously been lowered. However, the tax rate may not be increased to a rate above the tax rate approved by the voters.
Any revised tax rate may be adopted only if the commission determines, by a two-thirds vote, that the proceeds of the taxes with the altered tax rate will be sufficient to provide for the payment of principal of, and interest on, any limited tax bonds and any other indebtedness incurred by the commission which was to be payable from the proceeds of the retail transactions and use tax.
The commission, as part of the ballot proposition to approve the imposition of a retail transactions and use tax, shall seek authorization to issue bonds payable from the proceeds of the tax and establish the appropriations limit of the commission.
The maximum bonded indebtedness which may be outstanding at any one time shall be an amount equal to the sum of the principal of, and interest on, the bonds, but not to exceed the estimated proceeds of the transactions and use tax for a period of not more than the number of years for which the transactions and use tax authorized by this article is to be imposed.
The bonds authorized by the voters concurrently with the approval of the retail transactions and use tax may be issued by the commission at any time, and from time to time, payable from the proceeds of the tax. The bonds shall be referred to as “limited tax bonds.” The bonds may be secured by a pledge of revenues from the proceeds of the tax.
The pledge of retail transactions and use taxes to the limited tax bonds authorized under this article shall have priority over the use of any of the taxes for “pay-as-you-go” financing, except to the extent that the priority is expressly restricted in the resolution authorizing the issuance of the bonds.
The commission may provide for the bonds to bear a variable interest rate, for the manner and intervals in which the rate shall vary, and for the dates on which the interest shall be payable.
Limited tax bonds shall be issued pursuant to a resolution adopted at any time, and from time to time, by the commission by a two-thirds vote of all members of the commission.
The commission may from time to time issue bonds in accordance with the Revenue Bond Law of 1941 (Chapter 6 (commencing with Section 54300) of Part 1 of Division 2 of Title 5 of the Government Code), for the purposes set forth in the ordinance adopted pursuant to Section 132302, which shall constitute an “enterprise” within the meaning of Section 54309 of the Government Code. Article 3 (commencing with Section 54380) of Chapter 6 of Part 1 of Division 2 of Title 5 of the Government Code and the limitations on the rate of interest set forth in subdivision (b) of Section 54402 of the Government Code do not apply to the issuance and sale of bonds pursuant to this chapter. Instead, the commission shall authorize the issuance of bonds by resolution, which resolution shall specify all of the following:
The purposes for which the bonds are to be issued.
The maximum principal amount of the bonds.
The maximum term for the bonds.
The maximum rate of interest to be payable upon the bonds shall not exceed the maximum rate permitted for bonds of the commission by Section 53531 of the Government Code or any other applicable provisions of law. In the case of bonds bearing a variable interest rate, the variable rate shall on no day exceed the maximum rate permitted for bonds of the commission on that day by Section 53531 of the Government Code or any other applicable provisions of law. However, the variable interest rate so permitted may on any day exceed that maximum rate if the interest paid on the bonds from their date of original issuance to that day does not exceed the total interest which would have been permitted to have been paid on the bonds if the bonds had borne interest at all times from the date of issuance to that day at the maximum rate permitted from time to time by Section 53531 of the Government Code or any other applicable provisions of law.
The maximum discount on the sale of the bonds. However, the bonds shall not be sold at less than 95 percent of the principal amount in the manner determined by the commission. Each resolution shall provide for the issuance of bonds in the amounts as may be necessary, until the full amount of the bonds authorized has been issued. The full amount of bonds may be divided into two or more series with different dates of payment fixed for the bonds of each series. A bond need not mature on its anniversary date.
Any bonds issued pursuant to this article are a legal investment for all trust funds; for the funds of insurance companies, commercial and savings banks, and trust companies; and for state school funds. Whenever any money or funds may, by any law now or hereafter enacted, be invested in bonds of cities, counties, school districts, or other districts within the state, those funds may be invested in the bonds issued pursuant to this article, and whenever bonds of cities, counties, school districts, or other districts within this state may, by any law now or hereafter enacted, be used as security for the performance of any act or the deposit of any public money, the bonds issued pursuant to this article may be so used. The provisions of this article are in addition to all other laws relating to legal investments and shall be controlling as the latest expression of the Legislature with respect thereto.
Any action or proceeding wherein the validity of the adoption of the retail transactions and use tax ordinance provided for in this article or the issuance of any bonds thereunder or any of the proceedings in relation thereto is contested, questioned, or denied, shall be commenced within six months from the date of the election at wich the ordinance is approved; otherwise, the bonds and all proceedings in relation thereto, including the adoption and approval of the ordinance, shall be held to be valid and in every respect legal and incontestable.
The commission has no power to impose any tax other than the transactions and use tax imposed upon approval of the voters in accordance with this chapter.
ARTICLE 6. Extension, Expansion, or Increase of Transactions and Use Tax [132320. - 132334.]
For the purposes of this article, the following terms have the following meanings:
To “expand” the transactions and use tax means to expand the purposes for which the revenue derived from the tax may be expended to include covering the costs of implementation of the regional comprehensive plan as referenced in Article 6.5 (commencing with Section 132360). These projects shall be limited to mitigation of impacts related to growth, maximizing the efficiency of regional transportation and transit systems, and funding of regional projects that integrate land uses, transportation systems, infrastructure needs, and public investment strategies, within a regional framework. Projects shall be limited to any or all of the following:
Acquisition, management, maintenance, and monitoring of natural habitat and open space, and other projects that implement protection and preservation programs consistent with adopted natural community conservation plans and habitat conservation plans.
Development and implementation of watershed management.
Construction, repair, replacement, and maintenance of stormwater management and conveyance systems, and water quality improvement programs or projects.
Construction, acquisition, maintenance, monitoring, and operation of beach sand replenishment projects.
Funding of operations and maintenance costs for public transit projects that maximize mobility and transportation choices.
To “extend” the transactions and use tax means to extend the imposition of the tax beyond any term stated in the tax ordinance originally imposing the tax.
To “increase” the transactions and use tax means to increase the tax rate or the maximum tax rate authorized in the tax ordinance originally imposing the tax to an amount that does not exceed the maximum tax rate authorized under Section 132307.
The term “property” with regard to real property may include severable appurtenant real property rights such as easements, permits, and leases.
The “purposes” for which revenue derived from the transactions and use tax may be expended, in addition to the other purposes listed in this article and in Article 5 (commencing with Section 132300), include funding one or more grants to provide funding mechanisms for purchases of property or long-term management and monitoring of projects authorized by this section. Recipients of those grants shall be required to meet the applicable conditions of Section 132321.
The commission may, upon terms, standards, and conditions approved by the commission, transfer environmental mitigation or conservation property to a public agency or to a nonprofit corporation that is qualified pursuant to Section 501(c)(3) of the Internal Revenue Code.
As a condition to the transfer of property pursuant to this subdivision, the commission may enter into an agreement with the transferee to provide funding for the future maintenance and monitoring of the property consistent with any permit conditions and mitigation requirements imposed by state or federal law or conditions imposed by a state or federal agency. In determining the amount of the funding provided, the commission shall consider the costs of maintaining and monitoring the property and shall offset from the amount of those costs any benefit or value received by the transferee or the commission as a result of the transfer.
The transferee to which the commission transfers the property shall assume the long-term responsibility for the future maintenance and monitoring of the property.
If the transferee fails to maintain and monitor the property in the manner required by law, by a permit, or as described in paragraph (1), or if the transferee is a nonprofit corporation that ceases to exist, the property shall automatically revert to the commission.
If the property reverts to the commission pursuant to this paragraph, any remaining funds from the original transfer pursuant to paragraph (1) shall also revert to the commission.
Any costs, including legal costs, associated with reversion of the property and funds pursuant to this paragraph shall be the responsibility of the transferee.
Any documents conveying property in accordance with this section shall include a restriction limiting the use of the property solely for conservation purposes or environmental mitigation purposes in accordance with the conditions specified in paragraph (1).
Documents conveying property in accordance with this section and documents related to a transfer or assignment of property under this section shall be filed with the county recorder’s office in the county in which the property is located.
The transferee shall not do any of the following:
Transfer or assign the property to another entity without approval from the commission and compliance with this section.
Transfer or use the property for any purpose other than as required by the agreement described in paragraph (1), and any relevant permit conditions and mitigation requirements.
Subdivide the property.
Secure loans or liens against the property.
The commission shall conduct, or cause to be conducted, an audit of the performance of the transferee at least once every five years to ensure that the transferee is meeting its obligations pursuant to the terms of the agreement described in paragraph (1).
The commission may, upon terms, standards, and conditions approved by the commission, award one or more grants to provide a funding mechanism for long-term management and monitoring of projects authorized by Section 132320 to a public agency or to a nonprofit corporation that is qualified pursuant to Section 501(c)(3) of the Internal Revenue Code. As a condition to the award of a grant pursuant to this subdivision, the commission may enter into an agreement with the grantee that contains the following terms:
The grantee shall maintain accurate books, records, and accounts of all of its dealings, which shall be subject to an annual financial audit by an independent auditing firm approved by the commission. The grantee shall pay for the annual audit and provide a copy of the audit results to the commission. The commission shall determine whether the grant fund expenditures are consistent with the terms of the agreement described in this subdivision. In addition, the commission may conduct or cause to be conducted a fiscal and compliance audit of the grantee.
The commission shall conduct, or cause to be conducted, an audit of the performance of the grantee at least once every five years to ensure that the grantee is meeting its obligations pursuant to the terms of the agreement described in this subdivision.
If the grantee fails to perform its management or monitoring responsibilities in the manner required by law and in the manner required by the agreement described in this subdivision, or if a grantee that is a nonprofit corporation ceases to exist, any remaining funds derived from the grant pursuant to this subdivision shall revert to the commission.
Any costs, including legal costs, associated with reversion of funds to the commission pursuant to this paragraph shall be the responsibility of the grantee.
An ordinance expanding, extending, or increasing the retail transactions and use tax imposed under this chapter shall be imposed by the commission and shall be applicable to the entirety of, or a portion of, the incorporated and unincorporated territory of the county, if the constitutionally required percentage of the electors voting on the measure within the portion of the county to which the tax would apply vote to approve its imposition at a special election called for that purpose by the commission. The ordinance shall take effect on the day immediately following the day of the election at which the proposition is adopted.
If at any time the voters do not approve the imposition of the expansion, extension, or increase of the tax, the commission may, at any time thereafter, submit the same, or a different, measure to the voters in accordance with this article.
As used in this section, “commission” shall refer to the consolidated agency if the tax is to be imposed by the consolidated agency pursuant to Section 132360.6.
In the ordinance, the commission shall state the nature of the tax to be imposed, the tax rate or the maximum tax rate, and the purposes for which the revenue derived from the tax will be used. In connection with the extension or expansion of the tax, the tax rate or the maximum tax rate may be increased from the tax rate or the maximum tax rate in effect at that time.
If the tax is extended, the ordinance shall set forth the new term during which the tax will be imposed.
If the tax is expanded, the ordinance shall contain an expenditure plan that includes the allocation of revenues for the expanded purposes.
The county shall conduct an election called by the commission pursuant to Section 132322.
The election shall be called and conducted in the same manner as provided by law for the conduct of elections by a county.
Any ordinance extending or expanding, or both, the transactions and use tax shall be operative on the day immediately following the day of the election at which the proposition is adopted. Any increase in the tax rate or the maximum tax rate authorized by the ordinance shall be operative in accordance with Section 132304.
If the ordinance expands, extends, or increases the transactions and use tax, the commission shall contract with the State Board of Equalization to perform all functions incident to the administration and operation of the ordinance.
Any action or proceeding wherein the validity of the adoption of the extension, expansion, or increase of the retail transactions and use tax, or the issuance of any bonds thereunder, or any of the proceedings in relation thereto is contested, questioned, or denied, shall be commenced within 60 days from the date of the election at which the ordinance is approved; otherwise, the bonds and all proceedings in relation thereto, including the adoption and approval of the ordinance and the levy and collection of the retail transactions and use tax, shall be held to be valid and in every respect legal and incontestable.
The commission has no power to extend, expand, or increase any tax other than the transactions and use tax extended, expanded, or increased upon approval of the voters in accordance with this chapter.
All provisions of Article 5 (commencing with Section 132300) relating to allocation of revenues, tax rates, and bonds apply to the expanded, extended, or increased transactions and use tax, except that the revenues derived from the expanded or increased tax may be used for the additional purposes described in subdivision (a) of Section 132320.
CHAPTER 3. Transportation Consolidation For San Diego [132350. - 132372.4.]
ARTICLE 1. General Provisions, Findings, and Definitions [132350. - 132350.2.]
This chapter shall be known and may be cited as the San Diego Regional Transportation Consolidation Act. The purpose of this act is to provide for the consolidation of transportation responsibilities in the San Diego region which can only be provided for by and through enactment of state law.
The Legislature hereby finds and declares all of the following:
There is an imperative need for comprehensive planning and implementation of regional transportation projects in the San Diego region. Diminution of congestion on the streets and highways in the San Diego region will facilitate passage of all Californians traveling through San Diego, and especially benefit persons who live or work in San Diego County who must commute to points within and outside the San Diego region on a daily basis.
Several separate limited-purpose transportation agencies have been established in the San Diego region, however, the San Diego region would benefit from coordinated and comprehensive planning by these agencies.
In view of the limited powers of the San Diego Association of Governments (SANDAG), to provide the needed comprehensive transportation planning and implementation without consolidation of certain responsibilities of the transit boards, the Legislature finds that consolidation of the planning, programming, project development, and construction activities of various transportation agencies in the San Diego region will improve the efficiency and effectiveness of implementing needed transportation infrastructure and services and provide for a focus on meeting the mobility needs of the region.
It is, therefore, the intent of the Legislature in enacting this chapter to consolidate SANDAG and certain responsibilities of the transit boards to provide for sufficient power and authority to solve the transportation problems in the San Diego region and the needed comprehensive transportation system.
For purposes of this chapter, the definitions contained in this section have the following meanings:
“Consolidated agency” means the authority resulting from the consolidation of SANDAG and the transit boards’ responsibilities as set forth herein.
“Consolidated entities” means SANDAG and the transit boards as set forth in Article 4 (commencing with Section 132353).
“Population” means that population of any agency last determined for the agency as certified by the Department of Finance as of April 1 of each year, or if no certification has been made, the last Federal Decennial Census, except that the population of San Diego County shall be that population determined in the same manner for the unincorporated area of the county. The population of the region shall be that population determined by adding the population of each agency.
“North county coastal” means the Cities of Del Mar, Solana Beach, Encinitas, Carlsbad, and Oceanside.
“North county inland” means the Cities of Vista, San Marcos, Escondido, and Poway.
“South county” means the Cities of Chula Vista, National City, Imperial Beach, and Coronado.
“East county” means the Cities of El Cajon, Santee, La Mesa, and Lemon Grove.
“San Diego region” means the territory located within the boundaries of San Diego County.
“Transit boards” means the San Diego Metropolitan Transit Development Board (MTDB) and the North San Diego County Transit Development Board (NCTD).
ARTICLE 2. Organization and Governance [132351. - 132351.6.]
The consolidation of SANDAG and the transit boards will consolidate responsibilities under the organization and governance structure and with the powers, duties, functions, and authority as set forth herein.
A board of directors consisting of 21 members shall govern the consolidated agency.
For purposes of this chapter, “governing body” means the board of supervisors, council, council and mayor where the mayor is not a member of the council, authority, trustees, director, commission, committee, or other policymaking body, as appropriate, that exercises authority over an entity represented on the board of the consolidated agency.
All powers, privileges, and duties vested in or imposed upon the consolidated agency shall be exercised and performed by and through a board of directors provided, however, that the exercise of all executive, administrative, and ministerial power may be delegated and redelegated by the board, to any of the offices, officers, or committees created pursuant to this chapter or created by the board acting pursuant to this chapter.
The board shall be composed of one primary representative selected by the governing body of each city in the county and a member of the San Diego County Board of Supervisors. However, the City of San Diego and the County of San Diego shall each have a primary and secondary representative, which for the City of San Diego shall be the mayor of the City of San Diego and the president of the city council. Each director shall be a mayor, councilperson, or supervisor, as applicable, of the governing body that selected him or her, and shall serve until recalled by the governing body of the city or county. Vacancies shall be filled in the same manner as originally selected. Each city or county shall also select one alternate to serve on the board when the primary or secondary representative, if applicable, is not available. The alternate shall be subject to the same restrictions and have the same powers, when serving on the board, as the representative for whom he or she is substituting. The alternate shall be a mayor, councilperson, or supervisor, as applicable, of his or her governing body.
Notwithstanding subdivision (d), in those years when the primary representative of the San Diego County Board of Supervisors is from a district that is substantially an incorporated area, a supervisor who represents a district that is substantially an unincorporated area shall be appointed to the board as the secondary representative. Alternatively, in those years when the primary representative of the San Diego County Board of Supervisors is from a district that is substantially an unincorporated area, a supervisor who represents a district that is substantially an incorporated area shall be appointed to the board as the secondary representative.
At its discretion, each city or county may select a second alternate, in the same manner as the first alternate, to serve on the board in the event that neither the primary representative nor the first alternate is able to attend a meeting of the board. This alternate shall be subject to the same restrictions and have the same powers, when serving on the board, as the primary representative.
The board may allow for the appointment of advisory representatives to sit with the board but in no event shall those representatives be allowed a vote. The current advisory representatives to the San Diego Association of Governments may continue their advisory representation on the consolidated agency at the discretion of their governing body. The governing bodies of the County of Imperial and the cities in that county may collectively designate an advisory representative to sit with the board.
A majority of the member agencies constitute a quorum for the transaction of business. In order to act on any item, the affirmative vote of the majority of the members of the board present is required. However, after a vote of the members is taken, a weighted vote may be called by the members of any two jurisdictions.
The governing body of the City of San Diego and the County of San Diego shall allocate their weighted votes equally between their primary and secondary members.
For the weighted vote, there shall be a total of 100 votes, except additional votes shall be allowed pursuant to subdivision (h). Each member agency shall have that number of votes determined by the following apportionment formula, provided that each agency shall have at least one vote, no agency shall have more than 50 votes, and there shall be no fractional votes:
If any agency has 50 percent or more of the total population of the San Diego County region, allocate 50 votes to that agency and follow paragraph (2), and if not, follow paragraph (3).
Total the population of the remaining agencies determined in paragraph (1) and compute the percentage of this total that each agency has.
Multiply each percentage derived above by 50 to determine fractional shares.
Boost fractions that are less than one to one and add the whole numbers.
If the answer to subparagraph (B) is 50, drop all fractions and the whole numbers are the votes for each agency.
If the answer to subparagraph (B) is less than 50, the remaining vote is allocated one each to the agency having the highest fraction excepting those whose vote was increased to one pursuant to subparagraph (B).
If the answer to subparagraph (B) is more than 50, the excess vote is taken one each from the agency with the lowest fraction. In no case shall a vote be reduced to less than one.
Total the population determined in paragraph (1) and compute the percentage of this total that each agency has.
Boost fractions that are less than one to one and add the whole numbers.
If the answer to subparagraph (A) is 100, drop all fractions and the whole numbers are the votes for each agency.
If the answer to subparagraph (A) is less than 100, the remaining vote is allocated one each to the agency having the highest fraction excepting those whose vote was increased to one pursuant to subparagraph (A).
If the answer to subparagraph (A) is more than 100, the excess vote is taken one each from the agency with the lowest fraction. In no case shall a vote be reduced to less than one.
When a weighted vote is taken on any item that requires more than a majority vote of the board, it shall also require the supermajority percentage of the weighted vote.
Approval under the weighted vote procedure requires the vote of not less than four members representing separate jurisdictions and not less than 51 percent of the total weighted vote to supersede the original action of the board.
For purposes of subdivision (c), the population of the County of San Diego is the population in the unincorporated area of the county.
The weighted vote formula under subdivision (c) shall be recomputed every July 1.
Any newly incorporated city shall receive one vote under the weighted vote procedure until the next recomputation of the weighted vote formula under subdivision (c), at which time the new agency shall receive votes in accordance with the recomputed formula. Until this recomputation, the total weighted vote may exceed 100.
The consolidated agency is the successor agency to the San Diego Association of Governments (SANDAG) and those entities set forth in Article 4 (commencing with Section 132353). The consolidated agency is a statutorily created regional transportation planning agency under Section 29532.1 of the Government Code. As the successor to SANDAG, the consolidated agency succeeds to, continues, and maintains SANDAG’s federal, state and local designations, including, but not limited to, designation as the Metropolitan Planning Organization, is the San Diego County Regional Transportation Commission pursuant to Section 132005, is the congestion management agency, and is the council of governments for the San Diego region.
The consolidated agency shall have five standing policy advisory committees named the executive, transportation, regional planning, borders, and audit committees. The responsibilities of the committees shall be established by the board. Committee membership may be expanded by the consolidated agency, and shall be selected in accordance with a process established by the consolidated agency. The membership shall be as follows:
The executive committee shall consist of six voting members with board members representing east county, north county coastal, north county inland, south county, and the representative, or the representative’s alternate in their absence, from the City of San Diego and the county. The chairperson and the vice chairperson of the consolidated agency shall each be one of the six voting members.
The transportation committee shall consist of 10 voting members with board members or alternates representing east county, north county coastal, north county inland, south county and the mayor or a council member from the City of San Diego, a supervisor from the County of San Diego, a member of the board of the MTDB appointed by the board of the MTDB, a member of the board of the NCTD appointed by the board of the NCTD, a member of the governing board of the San Diego Unified Port District appointed by the board of the port, and a member of the San Diego County Regional Airport Authority appointed by the airport authority.
Among its transportation responsibilities, the transportation committee shall provide a strong focus and commitment to meeting the public transit needs of the San Diego region, set transit funding criteria and recommend transit funding levels, and undertake transit responsibilities resulting from consolidation, as delegated by the board.
The board shall provide a report, developed by the transportation committee, to the Legislature on or before December 31 of each year that outlines the public transit needs, transit funding criteria, recommended transit funding levels, and additional work on public transit, as delegated to the transportation committee by the board. The report shall specify the funds spent explicitly on public transportation. The report shall be submitted consistent with Section 9795 of the Government Code.
The regional planning committee shall consist of six voting members with board members or alternates representing east county, north county coastal, north county inland, south county, and the mayor or a council member from the City of San Diego, and a supervisor from the County of San Diego.
The borders committee shall consist of seven voting members with board members or alternates representing east county, north county coastal, north county inland, south county, the mayor or a council member from the City of San Diego, a supervisor from the County of San Diego, and a mayor, council member, or supervisor from the County of Imperial.
The audit committee shall consist of five voting members with two board members and three members of the public to be appointed by the board. The audit committee shall recommend to the board the contract of the firm conducting the annual financial statement audits and the hiring of the independent performance auditor and approve the annual audit plan after discussion with the independent performance auditor pursuant to subdivision (b) of Section 132354.1.
The board may appoint other standing and ad hoc working groups to advise it in carrying out its responsibilities.
No board member may serve as a member of more than two standing policy advisory committees at any one time, except those board members serving on the audit committee.
Each member of the consolidated agency, including alternate members when serving in the absence of a regular member at board meetings, and members, including alternates, of the policy advisory committees of the consolidated agency, shall be compensated as determined by the board, and for his or her necessary and reasonable expenses in performing his or her duties as a consolidated agency or policy advisory committee member.
The chairperson shall receive additional monthly compensation in an amount established from time to time by the board.
District 11 of the Department of Transportation shall coordinate with the consolidated agency on transportation planning for all projects within the jurisdiction of the consolidated agency in which the department and the consolidated agency have common planning or programming responsibilities.
ARTICLE 3. Administration [132352. - 132352.5.]
The consolidated agency may adopt bylaws and other rules necessary to carry out its responsibilities.
The clerk of the board shall cause a proposed ordinance or proposed amendment to an ordinance, and any ordinance adopted by the board, to be published at least once, in a newspaper of general circulation published and circulated in the board’s area of jurisdiction.
The publication of an ordinance, as required by subdivision (b), may be satisfied by either of the following actions:
The board may publish a summary of a proposed ordinance or proposed amendment to an ordinance. The summary shall be prepared by a person designated by the board. The summary shall be published and a certified copy of the full text of the proposed ordinance or proposed amendment shall be posted in the office of the clerk of the board at least five days prior to the board meeting at which the proposed ordinance or amendment is to be adopted. Within 15 days after adoption of the ordinance or amendment, the board shall publish a summary of the ordinance or amendment with the names of those board members voting for and against the ordinance or amendment and the clerk shall post in the office of the clerk a certified copy of the full text of the adopted ordinance or amendment along with the names of those board members voting for and against the ordinance or amendment.
If the person designated by the board determine that it is not feasible to prepare a fair and adequate summary of the proposed ordinance or amendment, and if the board so orders, a display advertisement of at least one-quarter of a page in a newspaper of general circulation in the board’s area of jurisdiction shall be published at least five days prior to the board meeting at which the proposed ordinance or amendment is to be adopted. Within 15 days after adoption of the ordinance or amendment, a display advertisement of at least one-quarter of a page shall be published. The advertisement shall indicate the general nature of, and provide information regarding, the adopted ordinance or amendment, including information sufficient to enable the public to obtain copies of the complete text of the ordinance or amendment, and the names of those board members voting for and against the ordinance or amendment.
All meetings of the consolidated agency, including, but not limited to, adjourned regular and special meetings of the board, shall be called, noticed, held, and conducted in accordance with the provisions of the Ralph M. Brown Act (Chapter 9 (commencing with Section 54950) of Part 1 of Division 2 of Title 5 of the Government Code). Ten members of the board shall constitute a quorum for transaction of the business of the board.
Acts of the board shall be expressed by motion, resolution, or ordinance.
The officers of the board are the chairperson and the vice chairperson. The chairperson and vice chairperson shall be elected by the membership of the board every two years or when a vacancy exists, by means of the weighted vote pursuant to Section 132351.2. The chairperson and vice chairperson shall not represent the same subregion, with the subregions being east county, north county coastal, north county inland, south county, the City of San Diego, and the County of San Diego. The board may create additional officers and elect members to those positions. However, no member may hold more than one office. The term of office for any officers of the board other than the chairperson and the vice chairperson shall be established by the board.
The Legislature finds and declares that there is a compelling interest in ensuring that all federal, state, local, and private funds available to the consolidated agency are captured and used in a timely manner. In order to maximize the use of federal, state, local, and private funds and to maintain a competitive posture in seeking supplemental federal funds, the consolidated agency may establish and use a flexible contracting process to maximize efficient use of public funds.
The consolidated agency may do any of the following with regard to contracting:
The consolidated agency may make contracts and enter into stipulations of any nature whatsoever, either in connection with eminent domain proceedings or otherwise, including, without limiting the generality of the foregoing, contracts and stipulations to indemnify and hold harmless, and to do all acts necessary for, incidental to, or convenient for the full exercise of the powers granted in this chapter.
The consolidated agency may contract with any department or agency of the United States or the State of California, local governmental authorities within or outside of the region, including those in Mexico, or any city, county, public district, public corporation, or joint powers authority formed pursuant to the Joint Exercise of Powers Act (Chapter 5 (commencing with Section 6500) of Division 7 of Title 1 of the Government Code) upon those terms and conditions as the consolidated agency finds are for the best interests of the consolidated agency.
If the estimated total cost of any construction project or public works project will exceed fifty thousand dollars ($50,000), the consolidated agency shall solicit bids in writing and shall award the work to the lowest responsible bidder or reject all bids. The consolidated agency shall establish rules for procurement of construction of public works projects.
Except in cases when an article of a specified brand or trade name is the only article that will properly meet the needs of the consolidated agency, all contracts for the acquisition or lease of materials, supplies, or equipment in an amount of one hundred fifty thousand dollars ($150,000), or a higher amount as authorized by the board, shall be made or entered into with the lowest responsible bidder meeting specifications. For purposes of determining the lowest bid, the amount of sales tax shall be excluded from the total amount of the bid.
If the estimated total cost of required services equals or exceeds one hundred fifty thousand dollars ($150,000), the services will not be performed by an entity described in paragraph (2), and the services are not within the category of services defined in Section 4525 of the Government Code, the consolidated agency shall solicit bids in writing and shall award the work in a competitive procurement process that is in the best interest of the consolidated agency.
Contracts for architectural, landscape architectural, engineering, environmental, land surveying services, and construction project management services in excess of one hundred fifty thousand dollars ($150,000) shall be let in accordance with Chapter 10 (commencing with Section 4525) of Division 5 of Title 1 of the Government Code.
Notwithstanding this chapter, the consolidated agency may use any procurement method authorized for state or local agencies by state or federal law, including, but not limited to, use of a competitive negotiation process in accordance with Article 7.5 (commencing with Section 20216) of Chapter 1 of Part 3 of Division 2 of the Public Contract Code. The consolidated agency shall maintain acquisition and contracting guidelines to be followed by the consolidated agency with respect to procurement of goods and services. These guidelines may be in the form of standard formats or model formats.
All of the privileges and immunities from liability, exemptions from laws, ordinances and rules, all pension, relief, disability, workers’ compensation, and other benefits that apply to the activity of officers, agents, or employees of a public agency when performing their respective functions shall apply to employees of the consolidated agency.
All claims for money or damages against the consolidated agency or its employees shall be governed by Part 1 (commencing with Section 810), Part 2 (commencing with Section 814), Part 3 (commencing with Section 900), and Part 4 (commencing with Section 940) of Division 3.6 of Title 1 of the Government Code applicable to public agencies and their employees, or by other statutes or regulations expressly applicable thereto.
ARTICLE 4. Consolidation [132353. - 132353.4.]
Definitions. The following definitions contained in this article shall govern the construction of this article.
“Construction” shall mean the final design, permitting and building of all transit projects including, but not limited to, commuter and freight rail, light rail, general rail infrastructure, regional bus facilities, paratransit, and other regional transit projects. Construction shall exclude the Oceanside to Escondido Rail Project and the Mission Valley East Extension Light Rail Project, and other projects or those portions of projects which have a construction contract in place at the time of the subsequent transfer defined in Section 132353.2. The aforementioned construction contracts may be assigned to the consolidated agency with mutual agreement of the consolidated agency and the respective transit board. Construction projects shall exclude local and minor improvement projects as defined in the transition plan.
“Planning” shall include, but not be limited to, conceptual development of transit projects and services and integration and coordination of all modes of transportation.
“Programming” shall mean the, acquisition, prioritization and allocation of funding of transit projects and services.
“Project development” shall mean alternative analysis, environmental review and clearance, preliminary engineering, and any other activities necessary to prepare for the construction of a transit project, as defined in the transition plans.
Notwithstanding any other provision of law and except as provided in this chapter, the San Diego Association of Governments shall be consolidated into a public agency known as the consolidated agency. In addition, upon adoption of the 2030 Regional Transportation Plan by the consolidated agency, and not later than July 1, 2003, all public transit and other transportation planning and programming responsibilities, including, but not limited to, short and near-term operational and financial planning and program development of the San Diego Metropolitan Transit Development Board (MTDB) and the North San Diego County Transit Development Board (NCTD), except as set forth in subdivision (c) of Section 132353.2 shall be consolidated into the consolidated agency. This consolidation shall be referred to as the initial transfer. A transition plan for the initial transfer of transit functions and responsibilities shall be developed by February 28, 2003, by the consolidated agency in consultation with the transit boards to ensure the efficient and timely transfer of the transit boards’ functions and responsibilities. All local, state, federal, and other funding available to carry out these responsibilities and those set forth in Section 132353.2, upon any consolidation, shall be deemed to be funding of the consolidated agency.
A transition plan for the transfer of project development and construction responsibilities of the transit boards and the financial resources therefore to the consolidated agency shall be developed by the consolidated agency in consultation with the transit boards to ensure the efficient and timely transfer of the transit boards’ project development and construction functions and responsibilities to the consolidated agency no later than September 30, 2003. The transfer and consolidation of project development and construction functions and responsibilities and the funding therefore shall occur no later than January 30, 2004, and shall be referred to as the subsequent transfer.
The transition plans should define the functional roles and responsibilities of the consolidated agency and the transit boards and should define, in the applicable transition plan, service and operational planning, programming, project development, and construction. The transition plans should acknowledge a strong linkage between service planning and operations scheduling.
Local route planning and scheduling and local financial planning therefor, would continue to be the responsibility of the transit boards in accordance with guidelines provided by the consolidated agency. The initial transition plan would include the development of guidelines and would define local route planning.
Notwithstanding the provisions of Section 132353.2, at any time after the initial transfer, the consolidated agency may enter into individual agreements with the MTDB or the NCTD for the transfer and consolidation of any or all functions, personnel, and funding of either agency, except those functions set forth in Section 132354.5, to the consolidated agency on terms and conditions as may be mutually agreed upon.
The MTDB and the NCTD shall continue to be a claimant, applicant, and grantee of local, state, and federal grants until the transfer and consolidation of functions or responsibilities to the consolidated agency pursuant to a transition plan at which time the consolidated agency shall become the claimant, applicant, and grantee for these funds. Except for funds which are transferred to the consolidated agency pursuant to a transition plan, the MTDB and the NCTD shall continue to receive funding pursuant to Article 4 (commencing with Section 99260) and Article 4.5 (commencing with Section 99275) of the Transportation Development Act in Chapter 4 of Part 11 of Division 10 and the State Transportation Assistance Fund in accordance with state law. Except for funds which are transferred to the consolidated agency pursuant to a transition plan, the MTDB and the NCTD shall continue to receive the Federal Section 5307 Urbanized Area Formula funds pursuant to federal statute. These funds should be allocated in a manner which will help enable the transit boards to meet their obligations and responsibilities recognizing the methodology and historic funding levels that have previously guided these funding decisions. The consolidated agency shall conduct a periodic review of the allocation and methodology for all formula-based funding.
The consolidated agency and the MTDB and the NCTD shall work together to obtain funds for transit projects and services.
It is the intent of the Legislature that future consolidation of transit operations of the MTDB and the NCTD into the consolidated agency should be comprehensively evaluated by the consolidated agency. This consolidation shall be referred to as a complete consolidation and shall be implemented only if it is considered to be appropriate by the consolidated agency and approved by a statute enacted by the Legislature.
In the event of complete consolidation of MTDB with the consolidated agency, any corporation that is a wholly owned subsidiary of MTDB shall become a subsidiary of the consolidated agency.
Upon the transfer of responsibilities and obligations from the consolidated entities into the consolidated agency, the consolidated agency, shall by operation of law, and in accordance with transition plans, succeed to all of the rights and obligations of the consolidated entities, including MTDB and NCTD, which enable the consolidated agency to perform the responsibility and obligations transferred, as provided in this section. This shall include, but not be limited to:
The rights and property of the consolidated entities, including MTDB and NCTD, pertaining to the responsibilities and obligations transferred.
The legally enforceable debts and liabilities of the consolidated entities, including MTDB and NCTD, pertaining to the responsibilities and obligations transferred in the same manner as if the consolidated agency had itself incurred them.
The rights of creditors and all liens upon the property of the consolidated entities or of their responsibilities shall be preserved unimpaired, limited in lien to the property affected by the liens immediately prior to the transfer of related responsibilities and obligations.
An action or proceeding pending by or against a consolidated entity, including MTDB and NCTD, may be prosecuted to judgment, and the judgment shall be binding on the consolidated agency, or the consolidated agency may be proceeded against or substituted in the place of a consolidated entity, if the action or proceeding pertains to a transferred responsibility or obligation.
In order to protect the holders of outstanding, unmatured bonds and other evidences of indebtedness of the consolidated entities, including MTDB and NCTD pertaining to the responsibilities and obligations transferred, the consolidated agency shall have the power to take all actions and do all things necessary or required for the protection of those holders and for compliance with the terms of those bonds and other evidences of indebtedness. The consolidated agency shall have the power to continue all services that the consolidated entities, including MTDB and NCTD are furnishing pertaining to the responsibilities and obligations transferred on the date of the transfer.
ARTICLE 5. Powers and Functions [132354. - 132354.8.]
The consolidated agency shall have and may exercise all rights and powers, expressed or implied, that are necessary to carry out the purposes and intent of this chapter, including, but not limited to, the power to do all of the following:
Sue and be sued.
To acquire any property by any means, and to hold, manage, occupy, develop, jointly develop, dispose of, convey, or encumber property.
To create a leasehold interest in property for the benefit of the consolidated agency.
To acquire, by eminent domain, any property necessary to carry out any of its powers or functions.
To merge or split parcels, adjust boundary lines, or take similar actions as part of the acquisition of land or as needed in order to carry out its functions.
To construct, acquire, develop, jointly develop, maintain, operate, lease, and dispose of work, property, rights-of-way, and facilities.
To appoint necessary employees, including counsel, and to define their qualifications and duties.
To enter into and perform all necessary contracts.
To fix and collect fees for any services rendered by it.
To adopt a seal and alter it at the consolidated agency’s pleasure.
To adopt an annual budget and to fix the compensation of its officers, board members, and employees.
To establish and enforce rules and regulations for the administration, operation, and maintenance of facilities and services.
To enter joint powers arrangements with other entities.
To provide insurance.
To issue bonds.
To do any other things necessary to carry out the purposes of this chapter.
The board shall arrange for a post audit of the financial transactions and records of the consolidated agency to be made at least annually by a certified public accountant.
The audit committee shall appoint an independent performance auditor, subject to approval by the board, who may only be removed for cause by a vote of at least two-thirds of the audit committee and the board.
The independent performance auditor shall have authority to conduct or to cause to be conducted performance audits of all departments, offices, boards, activities, agencies, and programs of the consolidated agency. The auditor shall prepare annually an audit plan and conduct audits in accordance therewith and perform those other duties as may be required by ordinance or as provided by the California Constitution and general laws of the state. The auditor shall follow government auditing standards. All officers and employees of the consolidated agency shall furnish to the auditor unrestricted access to employees, information, and records, including electronic data, within their custody regarding powers, duties, activities, organization, property, financial transactions, contracts, and methods of business required to conduct an audit or otherwise perform audit duties. It is also the duty of any consolidated agency officer, employee, or agent to fully cooperate with the auditor, and to make full disclosure of all pertinent information.
The auditor shall have the power to appoint, employ, and remove assistants, employees, and personnel as deemed necessary for the efficient and effective administration of the affairs of the office and to prescribe their duties, scope of authority, and qualifications.
The auditor may investigate any material claim of financial fraud, waste, or impropriety within the consolidated agency and for that purpose may summon any officer, agent, or employee of the consolidated agency, any claimant, or other person, and examine the person upon oath or affirmation relative thereto. All consolidated agency contracts with consultants, vendors, or agencies will be prepared with an adequate audit provision to allow the auditor access to the entity’s records needed to verify compliance with the terms specified in the contract. Results of all audits and reports shall be made available to the public in accordance with the requirements of the California Public Records Act (Division 10 (commencing with Section 7920.000) of Title 1 of the Government Code).
The board shall develop and adopt internal control guidelines to prevent and detect financial errors and fraud based on the internal control guidelines developed by the Controller pursuant to Section 12422.5 of the Government Code and the standards adopted by the American Institute of Certified Public Accountants.
The board shall develop and adopt an administration policy that includes a process to conduct staff performance evaluations on a regular basis to determine if the knowledge, skills, and abilities of staff members are sufficient to perform their respective functions, and shall monitor the evaluation process on a regular basis.
The board members shall make an annual report to their member agencies at a public meeting pursuant to Chapter 9 (commencing with Section 54950) of Part 1 of Division 2 of Title 5 of the Government Code, that includes a summary of activities by the consolidated agency including, but not limited to, program developments, project updates, changes to voter-approved expenditure plans, and potential ballot measures.
This chapter is necessary for the public health, safety, and welfare, and shall be liberally construed to carry out the objects and purposes of this chapter and the declared policy of the state as set forth in this chapter.
It is the intent of the Legislature that the federal government, the state, and local agencies within the jurisdictional area of the consolidated agency will participate in support of the consolidated agency. It is further the intent of the Legislature that financial support for the activities of the consolidated agency will be made available from federal, state, and local sources normally available for transportation and other planning purposes in the region and for those functions consolidated within the consolidated agency.
The consolidated agency shall be excluded from the requirements of a “local agency” set forth in Section 53091 of the Government Code.
Nothing in this chapter authorizes the consolidated agency to operate public transit systems.
Except as otherwise provided by law, the consolidated agency shall not have any authority over local land use decisions affecting permitting or zoning of public or private development projects.
The consolidated agency shall not enter into a construction contract over one million dollars ($1,000,000) with any entity unless the entity provides to the consolidated agency an enforceable commitment that the entity and its subcontractors at every tier will use a skilled and trained workforce to perform all work on the project or a contract that falls within an apprenticeship occupation in the building and construction trades in accordance with Chapter 2.9 (commencing with Section 2600) of Part 1 of Division 2 of the Public Contract Code.
This subdivision shall not apply if any of the following requirements are met:
The consolidated agency has entered into a project labor agreement that will bind all contractors and subcontractors performing work on the project or the consolidated agency has contracted to use a skilled and trained workforce and the entity has agreed to be bound by that project labor agreement.
The project or contract is being performed under the extension or renewal of a project labor agreement that was entered into by the consolidated agency before January 1, 2017.
The entity has entered into a project labor agreement that will bind the entity and all its subcontractors at every tier performing the project or the entity has contracted to use a skilled and trained workforce.
For purposes of subdivision (a), “project labor agreement” has the same meaning as defined in paragraph (1) of subdivision (b) of Section 2500 of the Public Contract Code.
The consolidated agency may implement every component of the regional transportation plan described in subparagraph (B) of paragraph (2) of subdivision (d) of Section 65080 of the Government Code, as well as subsequent updates of the regional transportation plan. This implementation authority shall include, but is not limited to, the authority to plan, engineer, design, and seek funding sources for applicable projects.
The implementation authority described in subdivision (a) shall include, but is not limited to, the authority to seek resources and fund projects identified in the sustainable communities strategy described in paragraph (2) of subdivision (b) of Section 65080 of the Government Code, including habitat conservation projects, water quality improvement projects, and other environmental mitigation projects.
The consolidated agency may exercise its bonding authority pursuant to Article 8 (commencing with Section 132370) to implement any component of the regional transportation plan described in subparagraph (B) of paragraph (2) of subdivision (d) of Section 65080, as well as subsequent updates to the regional transportation plan.
ARTICLE 6. Staffing, Labor, and Retirement Benefits [132355. - 132355.4.]
Administrative authority for the consolidated agency shall be vested in the office of the executive director, subject to the direction and policies of the consolidated agency as approved by the board. The executive director shall serve at the pleasure of the board and may appoint employees as may be necessary to carry out the functions of the consolidated agency.
The employees of the consolidated entities affected by this chapter shall become employees of the consolidated agency and shall suffer no loss of employment or reduction in wages, health and welfare and other benefits, seniority, retirement benefits or contributions made to retirement plans, or any other term or condition of employment as a result of the enactment of this chapter.
Upon succession of the consolidated agency under Section 132351.3, and in accordance with Article 4 (commencing with Section 132353), all affected employees of the consolidated entities shall become employees of the consolidated agency at their existing or substantially equivalent classifications, salaries, and benefits. All consolidated entity employees who become employees of the consolidated agency shall be given sick leave, seniority, and vacation credits in accordance with the records of the consolidated entity that previously employed them.
On the effective date of succession of the consolidated agency:
Regular employees of the consolidated entities shall be deemed qualified, and no other qualifications shall be required for employment or retention by the consolidated agency.
Probationary employees of consolidated entities shall retain their probationary status and rights, and shall not be deemed to have transferred so as to require serving a new probationary period.
Upon transfer of any public benefit corporation owned solely by the MTDB pursuant to Section 132353.3, any reference to the board or to the San Diego Metropolitan Transit Development Board in Article 1 (commencing with Section 120500), Article 2 (commencing with Section 120520), and Article 3 (commencing with Section 120540) of Chapter 5 of Division 11 shall be deemed to refer to the consolidated agency.
Members and beneficiaries of any pension or retirement system or other benefits established by the consolidated entities shall continue to have comparable rights, privileges, benefits, obligations, and status with respect to the established systems.
The consolidated agency and the Public Employees’ Retirement System (PERS) shall enter into an agreement to provide comparable benefits to those persons who were employees, retirees, or beneficiaries of the consolidated entities’ pension and retirement plans at the time of consolidation. Any expense related to this agreement between the consolidated agency and PERS, including retiree coverage, shall be borne by the consolidated agency. The agreement shall be effective as of the date of succession by the consolidated agency.
Those retired employees of the consolidated entities, including their eligible dependents, who are (1) retired on the effective date of the succession; or (2) an eligible beneficiary of a retired employee on the effective date of succession, and (3) who were eligible for benefits through PERS as provided and paid for by a consolidated entity, shall continue to be eligible for comparable benefits, including health care insurance, under the terms of the contracts between the consolidated entities and PERS in effect on the day prior to the succession. These benefits shall be provided at no cost to the retired employee or eligible beneficiary, except for normal copayments as otherwise provided for in the terms of the contracts between the consolidated entities and PERS in effect on the day prior to the succession.
Allowances of persons retired from the consolidated entities as of the consolidation date and their beneficiaries and of beneficiaries of deceased members or retired persons who are receiving allowances as of the succession date, shall be continued in at least the amount provided under the contracts between the consolidated entities and PERS in effect on the day prior to the succession. The succession shall not affect the contribution rate of any employee, retiree, or beneficiary or any retirement allowance or other benefit based on service to a consolidated entity being paid on the day prior to succession.
Notwithstanding Section 20511 of the Government Code, time of service by consolidated entity employees shall be credited as services rendered for the consolidated agency for purposes of calculating retirement benefits. The time of service by consolidated entity employees shall create prior service liabilities against the consolidated agency. Service rendered by consolidated entity employees who become employees of the consolidated agency on the date of succession shall be combined with service rendered by the employee as an employee of the consolidated agency for purposes of calculating retirement benefits. The consolidated agency’s contract with PERS shall contain a provision to bring this section into effect.
Whenever a majority of the employees employed by the consolidated agency in a unit appropriate for collective bargaining indicate a desire to be represented by a labor organization, and upon determining that the labor organization represents at least a majority of the employees in the appropriate unit, the determination of questions concerning employee representation and the conduct of employee-employer relations for the consolidated agency shall be governed by the Meyers-Milias-Brown Act (Chapter 10 (commencing with Section 3500) of Division 4 of Title 1 of the Government Code).
For the purposes of the wage orders of the Industrial Welfare Commission, the consolidated agency shall be considered a special district.
ARTICLE 6.3. Adoption and Revision of a Regional Aviation Strategic Plan and Airport Multimodal Accessibility Plan [132357. - 132359.]
On or before June 30, 2008, the San Diego County Regional Airport Authority and the consolidated agency shall enter into an agreement for the coordination of responsibilities for the adoption of, and updates to, the regional aviation strategic plan and the airport multimodal accessibility plan for San Diego County pursuant to this article. The agreement shall include provisions for coordination and timing of the preparation and maintenance of the plans. The agreement shall also provide for coordination of efforts to obtain funding from outside sources and equitable allocation of funding responsibilities for the airport multimodal accessibility plan.
The San Diego County Regional Airport Authority shall prepare a regional aviation strategic plan with the objective of identifying workable strategies to improve the performance of the San Diego County regional airport system.
The San Diego County Regional Airport Authority shall seek review and comment from the consolidated agency regarding the scope and content of the regional aviation strategic plan and any updates to the plan.
The elements of the regional aviation strategic plan shall include the following:
A forecast of air passenger and air cargo demand in San Diego County.
Identification of the existing capacity of the airports in the county for commercial and general aviation.
Identification of the strategies and facilities required to accommodate additional demand both as it relates to the air transportation system and the ground access system.
A financial strategy that estimates, over the life of the plan, the amount of funding that can be expected and the likely sources for the funding. The financial strategy shall include a program of investments supported by the expected revenues and estimated schedule of their implementation.
Other elements that further the development of the regional aviation strategic plan.
The regional aviation strategic plan shall incorporate the master plans and airport land use compatibility plans for the airports in San Diego County.
During the preparation of the regional aviation strategic plan, the San Diego County Regional Airport Authority shall take into consideration the interregional aviation plans from the regions bordering San Diego County.
During the preparation of the regional aviation strategic plan, the San Diego County Regional Airport Authority shall consult with all of the following:
Civilian and military airport operators in San Diego County.
Appropriate state and federal agencies.
Airport operators in regions adjacent to San Diego County.
The cities in San Diego County.
San Diego County.
The consolidated agency.
The public pursuant to subdivision (g).
The San Diego County Regional Airport Authority, in consultation with the consolidated agency, shall undertake and complete a public participation process to aid in the preparation of the regional aviation strategic plan. The public participation process shall employ a procedure that includes a method of addressing and responding to recommendations made by the public.
A draft of the regional aviation strategic plan and its recommendations shall be circulated for review and comment to the consolidated agency, to the civilian and military airport operators in the county, to cities within San Diego County in which an airport is located, and to San Diego County.
The first regional aviation strategic plan shall be adopted by June 30, 2011.
Upon adoption of the regional aviation strategic plan, the San Diego County Regional Airport Authority shall submit the plan to the consolidated agency.
The consolidated agency shall prepare and adopt a multimodal surface transportation accessibility plan for airports in San Diego County (airport multimodal accessibility plan) by December 31, 2013. The airport multimodal accessibility plan should be updated as necessary for the consolidated agency to comply with Section 132360.2.
The airport multimodal accessibility plan shall be prepared in consultation with the San Diego County Regional Airport Authority, San Diego County, the cities within San Diego County, the transit operators within San Diego County, the Department of Transportation, the civilian and military airport operators within San Diego County, and airport operators in regions adjacent to San Diego County.
The consolidated agency, in consultation with the San Diego County Regional Airport Authority, shall undertake and complete a public participation process to aid in the preparation of the airport multimodal accessibility plan. The public participation process shall employ a procedure that includes a method of addressing and responding to recommendations made by the public.
The elements of the airport multimodal accessibility plan shall include the following:
The identification of multimodal transportation investments that will improve surface transportation access to the airports in San Diego County and to other counties, if appropriate. The investments may include improvements that increase capacity through the construction of new facilities, or modification to existing facilities, and investments in operational improvements that enhance the carrying capacity of existing facilities.
A program of investments and the anticipated schedule for the development of the projects that comprise the program.
A financial element that estimates for the period of the plan the amount of funding that can be expected, the likely revenue sources from which the funding will be derived, and the program of investments supported by the expected revenue. The financial element shall also contain recommendations for allocation of funds. The financial element may recommend the development of specified new sources of revenue, consistent with the policy element and action.
Other elements that further the development of the airport multimodal accessibility plan.
In preparing the airport multimodal accessibility plan, the consolidated agency shall consider the following:
The regional aviation strategic plan prepared by the San Diego County Regional Airport Authority.
The airport master plans of the civilian and military airport operators in the county.
The general plans and their circulation element of the cities within San Diego County and San Diego County.
The transit plans of the transit operators in San Diego County.
The highway system improvement plans and programs of the Department of Transportation.
The intercity passenger rail plans of the California High-Speed Rail Authority.
The interregional aviation and rail plans from the regions bordering San Diego County.
Other pertinent plans.
Not less than six months prior to the adoption of the airport multimodal accessibility plan, the consolidated agency shall circulate for review and comment the draft plan and its proposed recommendations to the San Diego County Regional Airport Authority, the operators of the remaining civilian and military airports in San Diego County, the cities within San Diego County in which an airport is located, San Diego County, the Department of Transportation, representatives of the tenants of the airports, and other interested parties.
Following adoption of the first airport multimodal accessibility plan, the San Diego County Regional Airport Authority shall submit updated airport land use compatibility plans to the consolidated agency for review prior to adoption of the revised airport land use compatibility plan by the San Diego County Regional Airport Authority. The board of directors of the consolidated agency shall review proposed airport land use compatibility plans and updates to the plans submitted by the San Diego County Regional Airport Authority and make a determination as to their compatibility with the airport multimodal accessibility plan. In the event the consolidated agency finds that the plans are incompatible with the airport multimodal accessibility plan, the consolidated agency shall return the plan to the San Diego County Regional Airport Authority with its findings. The San Diego County Regional Airport Authority shall make any necessary modifications to achieve compatibility and resubmit the plan to the consolidated agency for another compatibility review.
The regional aviation strategic plan shall be reviewed not less than every five years and shall be updated, as necessary, to comply with Section 132360.2.
The airport multimodal accessibility plan shall not limit the authority granted to the San Diego County Regional Airport Authority in subdivision (a) of Section 170048.
ARTICLE 6.5. Adoption and Administration of a Regional Comprehensive Plan [132360. - 132360.6.]
It is the intent of the Legislature that the consolidated agency complete a public process by June 30, 2004, to prepare and adopt a regional comprehensive plan based on the local general and regional plans that integrates land uses, transportation systems, infrastructure needs, and public investment strategies, within a regional framework, in cooperation with member agencies and the public.
The regional comprehensive plan should be updated as necessary for the consolidated agency to comply with Section 132360.2.
In preparing and updating the regional comprehensive plan, it is the intent of the Legislature that:
The regional comprehensive plan preserve and improve the quality of life in the San Diego region, maximize mobility and transportation choices, and conserve and protect natural resources.
The regional comprehensive plan shall address the greenhouse gas emissions reduction targets set by the State Air Resources Board as required by Section 65080 of the Government Code and include strategies that provide for mode shift to public transportation.
The regional comprehensive plan shall identify disadvantaged communities as designated pursuant to Section 39711 of the Health and Safety Code and include transportation strategies to reduce pollution exposure in these communities.
In formulating and maintaining the regional comprehensive plan, the consolidated agency shall take account of and shall seek to harmonize the needs of the region as a whole, the plans of the county and cities within the region, and the plans and planning activities of organizations that affect or are concerned with planning and development within the region.
The consolidated agency shall engage in a public collaborative planning process. The recommendations resulting from the public collaborative planning process shall be made available to and considered by the consolidated agency for integration into the draft regional comprehensive plan. The consolidated agency shall adopt a procedure to carry out this process including a method of addressing and responding to recommendations from the public.
In formulating and maintaining the regional comprehensive plan, the consolidated agency shall seek the cooperation and consider the recommendations of all of the following:
Its member agencies and other agencies of local government within the jurisdiction of the consolidated agency.
State and federal agencies.
Educational institutions.
Research organizations, whether public or private.
Civic groups.
Private individuals.
Governmental jurisdictions located outside the region but contiguous to its boundaries.
The consolidated agency shall make the regional comprehensive plan, policies, and objectives available to all local agencies and facilitate consideration of the regional comprehensive plan in the development, implementation, and update of local general plans. The consolidated agency shall provide assistance and enhance the opportunities for local agencies to develop, implement, and update general plans in a manner that recognizes, at a minimum, land use, transportation compatibility, and a jobs-to-housing balance within the regional comprehensive plan.
The consolidated agency shall maintain the data, maps, and other information developed in the course of formulating the regional comprehensive plan in a form suitable to assure a consistent view of developmental trends and other relevant information for the availability of and use by other government agencies and private organizations.
The components of the regional comprehensive plan may include, but are not limited to, transportation, housing, water quality and supply, infrastructure, air quality, energy, solid waste, economy, and open space, including habitat. Performance standards and measurable criteria shall be established through a public process to ensure that the regional comprehensive plan is prepared consistent with these measures as well as in determining achievement of the regional comprehensive plan goals throughout its implementation.
Any water supply component or provision of the regional infrastructure strategy regarding water supply contained in the regional comprehensive plan shall be consistent with the urban water management plan and other adopted regional water facilities and supply plans of the San Diego County Water Authority.
The regional transportation plan, the regional aviation strategic plan, the airport multimodal accessibility plan, and the regional comprehensive plan should be compatible. The regional comprehensive plan should set the framework for the type of changes upon which subsequent regional transportation plans, regional aviation strategic plans, and airport multimodal accessibility plans should focus.
The consolidated agency shall maintain the data, maps, and other information developed in the course of formulating the regional comprehensive plan in a form suitable to assure a consistent view of developmental trends and other relevant information for the availability of and use by other government agencies and private organizations.
Each member agency should review the actions that the consolidated agency makes on state and federally regulated or mandated items and report these actions to their respective jurisdiction for review.
All documents created in compliance with this article shall be made available and ready for public review in compliance with the California Public Records Act (Division 10 (commencing with Section 7920.000) of Title 1 of the Government Code).
The consolidated agency may use the authority for the retail transactions and use tax provided under Sections 132301 and 132302 to fund and finance infrastructure needs identified in the regional comprehensive plan developed in accordance with this article. Development of the proposal and expenditure plan shall be conducted using a public collaborative planning process that is consistent with Section 132360.1.
ARTICLE 7. Voter Approval [132362. - 132364.]
In addition to the authority set forth in Article 5 (commencing with Section 132300) and Article 6 (commencing with Section 132320) of Chapter 2 of Division 12.7, if the consolidated agency provides compensation to San Diego County for the cost of including an ordinance or measure on the ballot, the consolidated agency may call an election, including an advisory election, in San Diego County on any ordinance or measure regarding the governance of or matters related to the powers, privileges, or duties of the consolidated agency, including, but not limited to, merger or complete consolidation of the transit boards.
The ordinance or measure shall be consistent with, and shall not be in conflict with, any other provision of this chapter.
The county shall conduct an election, including an advisory election, called by the consolidated agency in the same manner as provided by law for the conduct of elections by a county.
ARTICLE 8. Bonds, Equipment, and Leases [132370. - 132372.4.]
The consolidated agency may issue bonds, payable from revenue of any facility or enterprise to be acquired or constructed by the consolidated agency, in the manner provided by the Revenue Bond Law of 1941 (Chapter 6 (commencing with Section 54300) of Part 1 of Division 2 of Title 5 of the Government Code), and all of the provisions of that law are applicable to the consolidated agency.
The consolidated agency may issue revenue bonds under the Revenue Bond Law of 1941 for any one or more transit facilities authorized to be acquired, constructed, or completed by the consolidated agency or for transit equipment described in Section 132372 below authorized to be acquired by the consolidated agency or, in the alternative, the consolidated agency may issue revenue bonds under the Revenue Bond Law of 1941 for the acquisition, construction, and completion of any one of those transit facilities or for transit equipment described in Section 132372 below authorized to be acquired by the consolidated agency.
Nothing in this article prohibits the consolidated agency from availing itself of, or making use of, any procedure provided in this chapter for the issuance of bonds of any type or character for any of the transit facilities authorized hereunder, and all proceedings may be carried on simultaneously or, in the alternative, as the consolidated agency may determine.
Article 3 (commencing with Section 54380) of Chapter 6 of Part 1 of Division 2 of Title 5 of the Government Code does not apply to the issuance and sale of bonds pursuant to this chapter and the consolidated agency shall authorize the issuance of such bonds by resolution of its governing board.
The Improvement Act of 1911 (Division 7 (commencing with Section 5000) of the Streets and Highways Code), the Improvement Bond Act of 1915 (Division 10 (commencing with Section 8500) of the Streets and Highways Code), and the Municipal Improvement Act of 1913 (Division 12 (commencing with Section 10000) of the Streets and Highways Code), are applicable to the consolidated agency.
Chapter 1 (commencing with Section 99000) of Part 11 of Division 10 of the Public Utilities Code is applicable to the consolidated agency.
The consolidated agency shall be considered to be a “local agency” as defined in subdivision (h) of Section 53317 of the Government Code and the provisions of Chapter 2.5 (commencing with Section 53311) of Part 1 of Division 2 of Title 5 of the Government Code are applicable to the consolidated agency.
The consolidated agency shall be considered to be a “local agency” as defined in subdivision (f) of Section 6585 of the Government Code and the provisions of Article 4 (commencing with Section 6584) of Chapter 5 of Division 7 of Title 1 of the Government Code are applicable to the consolidated agency.
The consolidated agency may borrow money in accordance with Article 7 (commencing with Section 53820), Article 7.6 (commencing with Section 53850), or Article 7.7 (commencing with Section 53859) of Chapter 4 of Part 1 of Division 2 of Title 5 of the Government Code.
The consolidated agency may borrow money in anticipation of the sale of bonds which have been authorized to be issued, but which have not been sold and delivered, and may issue negotiable bond anticipation notes therefor and may renew the bond anticipation notes from time to time, but the maximum maturity of any bond application notes, including the renewals thereof, shall not exceed five years from the date of delivery of the original bond anticipation notes.
The bond anticipation notes may be paid from any money of the consolidated agency available therefor and not otherwise pledged. If not previously otherwise paid, the bond anticipation notes shall be paid from the proceeds of the next sale of the bonds of the consolidated agency in anticipation of which they were issued. The bond anticipation notes shall not be issued in any amount in excess of the aggregate amount of bonds which the consolidated agency has not been authorized to issue, less the amount of any bonds of the authorized issue previously sold, and also less the amount of other bond anticipation notes therefor issued and then outstanding.
The bond anticipation notes shall be issued and sold in the same manner as the bonds. The bond anticipation notes and the resolution or resolutions authorizing them may contain any provisions, conditions, or limitations which a resolution of the consolidated agency authorizing the issuance of bonds may contain.
The consolidated agency may bring an action to determine the validity of any of its bonds, equipment trust certificates, warrants, notes, or other evidences of indebtedness pursuant to Chapter 9 (commencing with Section 860) of Title 10 of Part 2 of the Code of Civil Procedure.
All bonds and other evidences of indebtedness issued by the consolidated agency under this chapter, and the interest thereon, are free and exempt from all taxation within the state, except for transfer, franchise, inheritance and estate taxes.
Notwithstanding any other provisions of this article or any other law, the provisions of all ordinances, resolutions, and other proceedings in the issuance by the consolidated agency of any bonds, bonds with a pledge of revenues, bonds for any and all evidences of indebtedness or liability constitute a contract between the consolidated agency and the holders of the bonds, equipment trust certificates, notes, or evidences of indebtedness or liability, and the provisions thereof are enforceable against the consolidated agency or any or all of its successors or assigns, by mandamus or any other appropriate suit, action, proceeding in law or in equity in any court of competent jurisdiction.
Nothing in this article or in any other law shall be held to relieve the consolidated agency or the territory included within it from any bonded or other debt or liability contracted by the consolidated agency. Upon dissolution of the consolidated agency or upon withdrawal of territory therefrom, that territory formerly included within the consolidated agency, or withdrawn therefrom, shall continue to be liable for the payment of all bonded and other indebtedness or liabilities outstanding at the time of the dissolution or withdrawal as if the consolidated agency had not been so dissolved or the territory withdrawn therefrom, and it shall be the duty of the successors or assigns to provide for the payment of the bonded and other indebtedness and liabilities.
Except as may be otherwise provided in the proceedings for the authorization, issuance, and sale of any revenue bonds, bonds secured by a pledge of revenues, or bonds for improvement districts secured by a pledge of revenues, revenues of any kind or nature derived from any revenue-producing improvements, works, facilities, or property owned, operated, or controlled by the consolidated agency shall be pledged, charged, assigned, and have a lien thereon for the payment of the bonds as long as they are outstanding, regardless of any changes in ownership, operation, or control of the revenue-producing improvements, works, facilities or property and it shall, in any later event or events, be the duty of the successors or assigns to continue to maintain and operate the revenue-producing improvements, works, facilities, and property as long as bonds are outstanding.
The consolidated agency may purchase transit equipment such as cars, trolley buses, motorbuses, light rail vehicles, or rolling equipment, and may execute agreements, leases, and equipment trust certificates in the forms customarily used by private corporations engaged in the transit business appropriate to effect the purchase and leasing of transit equipment, and may dispose of the equipment trust certificates upon the terms and conditions that the consolidated agency may deem appropriate.
Payment for transit equipment, or rentals therefor, may be made in installments, and the deferred installments may be evidenced by equipment trust certificates that are or will be legally available to the consolidated agency. Title to the equipment shall not vest in the consolidated agency until the equipment trust certificates are paid.
The agreement to purchase or lease transit equipment may direct the vendor or lessor to sell and assign or lease the transit equipment to a bank or trust company duly authorized to transact business in the state as trustee for the benefit and security of the equipment trust certificates, and may direct the trustee to deliver the transit equipment to one or more designated officers of the consolidated agency and may authorize the consolidated agency to simultaneously therewith execute and deliver an installment purchase agreement or a lease of such equipment to the consolidated agency.
The agreements and leases shall be duly acknowledged before a person authorized by law to take acknowledgments of deeds and in the form required for acknowledgment of deeds.
The agreements, leases and equipment trust certificates shall be authorized by resolution of the consolidated agency and shall contain covenants, conditions, and provisions which may be deemed necessary or appropriate to ensure the payment of the equipment trust certificates from such legally available source or sources of funds as may be specified in the certificates.
The covenants, conditions, and provisions of the agreements, leases and equipment trust certificates shall not conflict with any of the provisions of any trust agreement or similar document securing the payment of bonds, notes, or certificates of the consolidated agency.
An executed copy of each agreement and lease shall be filed in the office of the Secretary of State, who shall be entitled to receive one dollar ($1) for each copy filed.
The filing constitutes notice to any subsequent judgment creditor or any subsequent purchaser.
CHAPTER 6. Pasadena Metro Blue Line Construction Authority [132400. - 132450.]
For purposes of this chapter, the following terms have the following meanings:
The “authority” is the Metro Gold Line Foothill Extension Construction Authority created under this chapter, formerly known as the Pasadena Metro Blue Line Construction Authority.
The “board” is the governing board of the authority.
The “commission” is the California Transportation Commission.
The “LACMTA” is the Los Angeles County Metropolitan Transportation Authority.
The “project” is the Los Angeles-Pasadena Foothill Extension Gold Line light rail project, formerly known as the Los Angeles-Pasadena Metro Blue Line, extending from Union Station in the City of Los Angeles to Sierra Madre Villa Boulevard in the City of Pasadena and any mass transit guideway that may be planned east of Sierra Madre Villa Boulevard along the rail right-of-way extending to the City of Montclair.
The “extension cities” are the Cities of Arcadia, Monrovia, Duarte, Irwindale, Azusa, Glendora, San Dimas, La Verne, Pomona, Claremont, and Montclair.
The authority is hereby created for the purpose of awarding and overseeing all design and construction contracts for completion of the project.
The authority has all of the powers necessary for planning, acquiring, leasing, developing, jointly developing, owning, controlling, using, jointly using, disposing of, designing, procuring, and building the project, including, but not limited to, all of the following:
Acceptance of grants, fees, allocations, and transfers of funds from federal, state, and local agencies, as well as private entities.
Acquiring, through purchase or through eminent domain proceedings, any property necessary for, incidental to, or convenient for, the exercise of the powers of the authority.
Incurring indebtedness, secured by pledges of revenue available for project completion.
Contracting with public and private entities for the planning, design, and construction of the project. These contracts may be assigned separately or may be combined to include any or all tasks necessary for completion of the project.
Entering into cooperative or joint development agreements with local governments or private entities. These agreements may be entered into for the purpose of sharing costs, selling or leasing land, air, or development rights, providing for the transferring of passengers, making pooling arrangements, or for any other purpose that is necessary for, incidental to, or convenient for the full exercise of the powers granted the authority. For purposes of this paragraph, “joint development” includes, but is not limited to, an agreement with any person, firm, corporation, association, or organization for the operation of facilities or development of projects adjacent to, or physically or functionally related to, the project.
Relocation of utilities, as necessary for completion of the project.
The duties of the authority include, but are not limited to, all of the following:
Conducting the financial studies and the planning and engineering necessary for completion of the project.
Adoption of an administrative code, not later than 60 days after establishment of the authority, for administration of the authority in accordance with any applicable laws, including, but not limited to, the Ralph M. Brown Act (Chapter 9 (commencing with Section 54950) of Part 1 of Division 2 of Title 5 of the Government Code), the provisions of this chapter, laws generally applicable to local agency procurements and contracts, laws relating to contracting goals for minority and women business participation, and the Political Reform Act of 1974 (Title 9 (commencing with Section 81000) of the Government Code).
The administrative code adopted under subparagraph (A) shall include a code of conduct for employees and board members that is consistent with Sections 84308 and 87103 of the Government Code and prohibits board members and staff from accepting gifts valued at ten dollars ($10) or more from contractors, potential contractors, or their subcontractors.
The code shall require the disclosure, on the record, of the proceedings by the officer of the agency who receives a contribution within the preceding 24 months in an amount of more than two hundred fifty dollars ($250) from a party or participant to a proceeding, and the disclosure by the party or participant.
The code shall provide that no officer of the agency shall make, participate in making, or in any way attempt to use his or her official position to influence the decision in a proceeding, as described in Section 84308 of the Government Code, if the officer has willfully or knowingly received a contribution in the amount of more than two hundred fifty dollars ($250) within the preceding 24 months from a party or his or her agent, or from any participant or his or her agent if the participant has a financial interest in the decision.
Any officer deemed ineligible to participate in a proceeding due to the provisions of this code of conduct may be replaced for the purposes of that proceeding by an appointee chosen by the appropriate appointing authority.
Under the code of conduct, board members shall be deemed to have a financial interest in a decision within the meaning of Section 87100 of the Government Code if the decision involves the donor of, or intermediary or agent for a donor of, a gift or gifts aggregating ten dollars ($10) or more in value within the 12 months prior to the time the decision was made.
Board members and alternate members shall not be considered financially interested, under or for the purposes of Section 1090 of the Government Code, solely by virtue of their holding office with the authority and, concurrently, holding office with an entity set forth in subdivision (a) of Section 132415, an extension city, or both such an entity and such a city, and they may participate in decisions and agreements regarding the authority, any of the entities set forth in subdivision (a) of Section 132415, and any of the extension cities. The participation described in this clause shall not constitute a conflict of interest under or for the purposes of Section 1090 of the Government Code, or an incompatible employment, activity, or enterprise under or for the purposes of Section 1126 of the Government Code.
The authority shall make reasonable progress, as determined by the commission, in the design and construction of the project within the timetable imposed under the 1998 State Transportation Improvement Program.
The authority shall be governed by a board consisting of five voting members and four nonvoting members who shall be appointed as follows:
Three members shall be appointed by the City Councils of the Cities of Los Angeles, Pasadena, and South Pasadena, with each city council appointing one member by a majority vote of the membership of that city council.
One member shall be appointed by the President of the Governing Board of the San Gabriel Valley Council of Governments, subject to confirmation by that board.
One member shall be appointed by the LACMTA.
One nonvoting member shall be appointed by the Governor.
Two nonvoting members shall be appointed by the City Councils of the Cities of Pasadena and South Pasadena, with each city appointing one nonvoting member.
One nonvoting member shall be appointed by the president of the board of directors of the San Bernardino Associated Governments, subject to confirmation by that board.
All members shall serve a term of not more than four years, with no limit on the number of terms that may be served by any person.
Each appointing authority shall also appoint an alternate member to serve in a member’s absence. If the position of a voting member becomes vacant, the alternate member shall serve until the position is filled as required pursuant to subdivision (a).
Members of the board are subject to the Political Reform Act of 1974 (Title 9 (commencing with Section 81000) of the Government Code).
Three members of the board shall constitute a quorum.
The board shall elect a chairperson and vice chairperson from among the membership of the board.
Each member of the board may be compensated at a rate of not more than one hundred fifty dollars ($150) per day spent attending to the business of the authority. Compensation, if paid, shall not exceed six hundred dollars ($600) per month, plus expenses directly related to the performance of duties imposed by the authority, including, but not limited to, travel and personal expenses.
Members appointed to the board may include members of the entities set forth in subdivision (a), and members of the city councils or other elected officials of the extension cities, or both. The simultaneous membership described in this subdivision shall not constitute a violation of Section 1099 or 1126 of the Government Code.
The board may appoint an executive director to serve at the pleasure of the authority.
The executive director is exempt from all civil service provisions and shall be paid a salary established by the board.
The executive director may appoint staff or retain consultants as necessary to carry out the duties of the authority.
All contracts approved and awarded by the executive director shall be awarded in accordance with state laws generally applicable to local agency procurements and contracts, subject to the provisions of this chapter. Awards shall be based on price or competitive negotiation, or on both of those things.
The LACMTA shall identify and expeditiously enter into an agreement with the authority to hold in trust with the authority all real and personal property, and any other assets accumulated in the planning, design, and construction of the project, including, but not limited to, rights-of-way, documents, third-party agreements, contracts, and design documents, as necessary for completion of the project.
The LACMTA shall transfer the unencumbered balance of all local funds programmed for completion of the project and that have been identified in the Restructuring Plan adopted by the LACMTA Board of Directors on May 13, 1998, to the authority for completion of the project.
The authority is eligible to receive allocations of state funds for the project. The unencumbered balance of funds currently programmed or allocated to the LACMTA for completion of the project and that have been identified in the Restructuring Plan adopted by the LACMTA Board of Directors on May 13, 1998, shall be allocated to the authority for completion of the project.
Any transfer of funds by the LACMTA under this section shall be subject to the terms of the memorandum of understanding entered into between the LACMTA and the commission on June 2, 1998.
The authority shall enter into a memorandum of understanding with the LACMTA that shall specifically address the ability of the LACMTA to review any significant changes in the scope of the design or construction, or both design and construction, of the project. For purposes of this section, the term “significant change” means any change of mode or technology, or any other substantive change that affects the connectivity and operation of the project as part of the overall transit system operated by the LACMTA, or any combination of those things. Design and construction of a light rail project that is consistent with the current scope of the project shall not be deemed to be a significant change in the scope of the project and shall not require concurrence by the LACMTA.
The authority shall not encumber any future farebox revenue anticipated from the operation of the project.
The authority shall not encumber the project with any obligation that is transferable to the LACMTA upon completion of the design and construction of the project. The design and construction to be administered by the authority does not include rolling stock, which is a component of the operation of the project and shall be administered by the LACMTA. This section does not apply to any joint development programs, as authorized under paragraph (5) of subdivision (a) of Section 132410, that may be utilized to contribute to the financing of project design and construction.
The LACMTA shall assume responsibility for operating all completed phases of the project.
Subject to subparagraph (A), the LACMTA shall have the authority to operate the portion of the project located in the County of San Bernardino, which extends approximately one-half mile from the Los Angeles and San Bernardino County line to the Montclair Transit Center.
With respect to the portion of the project on the right-of-way owned by the San Bernardino Associated Governments, the LACMTA’s authority to operate the project shall be contingent upon the approval of the board of directors of the San Bernardino Associated Governments, acting as the county transportation commission, through approval of an operations and maintenance agreement with the LACMTA.
The operations and maintenance agreement shall provide that the San Bernardino Associated Governments reimburse the LACMTA for the costs of operating that portion of the line located in the County of San Bernardino.
Prior to the commencement of construction of the portion of the project in the County of San Bernardino, the authority shall enter into a construction agreement with the San Bernardino Associated Governments, acting as the county transportation commission.
Nothing in this section shall be construed to require the LACMTA to allocate funds to the project beyond funds that have been allocated as of January 1, 2012.
The authority shall be dissolved when project construction has been completed.
CHAPTER 7. Exposition Metro Line Construction Authority [132600. - 132650.]
For purposes of this chapter, the following terms have the following meanings:
The “authority” is the Exposition Metro Line Construction Authority created under this chapter.
The “board” is the governing board of the authority.
The “commission” is the California Transportation Commission.
The “LACMTA” is the Los Angeles County Metropolitan Transportation Authority.
The “project” is the Los Angeles-Exposition Metro Line light rail project extending from the Metro Rail Station at 7th Street and Flower Street in the City of Los Angeles to the downtown of the City of Santa Monica.
The authority is hereby created for the purpose of awarding and overseeing final design and construction contracts for completion of the project.
The authority has all of the powers necessary for planning, acquiring, leasing, developing, jointly developing, owning, controlling, using, jointly using, disposing of, designing, procuring, and building the project, including, but not limited to, all of the following:
Acceptance of grants, fees, allocations, and transfers of funds from federal, state, and local agencies, and private entities.
Acquiring, through purchase or through eminent domain proceedings, any property necessary for, incidental to, or convenient for, the exercise of the powers of the authority, provided the authority shall use existing rights-of-way where feasible.
Incurring indebtedness, secured by pledges of revenue available for project completion.
Contracting with public and private entities for the planning, design, and construction of the project. These contracts may be assigned separately or may be combined to include any or all tasks necessary for completion of the project.
Entering into cooperative or joint development agreements with local governments or private entities. These agreements may be entered into for the purpose of sharing costs, selling or leasing land, air, or development rights, providing for the transferring of passengers, making pooling arrangements, or for any other purpose that is necessary for, incidental to, or convenient for the full exercise of the powers granted to the authority. For purposes of this paragraph, “joint development” includes, but is not limited to, an agreement with any person, firm, corporation, association, or organization for the operation of facilities or development of projects adjacent to, or physically or functionally related to, the project.
Relocation of utilities, as necessary for completion of the project.
The duties of the authority include, but are not limited to, all of the following:
Conducting financial and environmental studies, planning, and engineering necessary for completion of the project.
Adoption of an administrative code for administration of the authority in accordance with any applicable laws, including, but not limited to, the Ralph M. Brown Act (Chapter 9 (commencing with Section 54950) of Part 1 of Division 2 of Title 5 of the Government Code), contracting and procurement laws, laws relating to contracting goals for minority and women business participation, and the Political Reform Act of 1974 (Title 9 (commencing with Section 81000) of the Government Code).
The administrative code adopted under subparagraph (A) shall include a code of conduct for employees and board members that is consistent with Sections 84308 and 87103 of the Government Code and prohibits board members and staff from accepting gifts valued at ten dollars ($10) or more from contractors, potential contractors, or their subcontractors.
The code shall require the disclosure, on the record, of the proceedings by the officer of the agency who receives a contribution within the preceding 24 months in an amount of more than two hundred fifty dollars ($250) from a party or participant to a proceeding, and the disclosure by the party or participant.
The code shall provide that no officer of the agency shall make, participate in making, or in any way attempt to use his or her official position to influence the decision in a proceeding, as described in Section 84308 of the Government Code, if the officer has willfully or knowingly received a contribution in the amount of more than two hundred fifty dollars ($250) within the preceding 24 months from a party or his or her agent, or from any participant or his or her agent, if the participant has a financial interest in the decision.
Any officer deemed ineligible to participate in a proceeding due to the provisions of this code of conduct may be replaced for the purposes of that proceeding by an appointee chosen by the appropriate appointing authority.
Under the code of conduct, board members shall be deemed to have a financial interest in a decision within the meaning of Section 87100 of the Government Code if the decision involves the donor of, or intermediary or agent for a donor of, a gift or gifts aggregating ten dollars ($10) or more in value within the 12 months prior to the time the decision was made.
Board members, alternate members, officers, consultants, and employees shall not be considered financially interested solely by virtue of their holding office or being employed by the authority as well as an appointing authority set forth in subdivision (a) of Section 132615, and they may participate in decisions and agreements regarding the authority and any of the appointing authorities set forth in subdivision (a) of Section 132615. The participation described in this clause shall not constitute a conflict of interest under Section 1090 of the Government Code and shall not constitute an incompatible activity under Section 1126 of the Government Code.
As necessary for final design and construction, completion of a detailed management, implementation, safety, and financial plan for the project and submission of the plan to the Governor, the Legislature, and the commission.
The authority shall make reasonable progress, as determined by the commission, in the final design and construction of the project.
The duties and responsibilities imposed by this section shall be contingent upon allocation of federal and local funds by the LACMTA for these purposes.
The authority shall be governed by a board consisting of seven voting members who shall be appointed as follows:
Two members shall be appointed by the City Councils of the Cities of Santa Monica and Culver City with each city council appointing one member by a majority vote of the membership of that city council.
Two members shall be appointed by the Los Angeles County Board of Supervisors.
One member shall be appointed by the LACMTA.
Two members shall be appointed by the City Council of the City of Los Angeles by a majority vote of its membership.
All members shall serve a term of not more than four years, with no limit on the number of terms that may be served by any person.
Each appointing authority shall also appoint an alternate member to serve in a member’s absence. If the position of a voting member becomes vacant, the alternate member shall serve until the position is filled as required pursuant to subdivision (a).
Members of the board are subject to the Political Reform Act of 1974 (Title 9 (commencing with Section 81000) of the Government Code).
Four members of the board shall constitute a quorum.
The board shall elect a chairperson and vice chairperson from among the membership of the board.
Each member of the board may be compensated at a rate of not more than one hundred fifty dollars ($150) per day spent attending to the business of the authority. Compensation, if paid, shall not exceed six hundred dollars ($600) per month, plus expenses directly related to the performance of duties imposed by the authority, including, but not limited to, travel and personal expenses.
The Chief Executive Officer of the LACMTA shall serve on the board as an ex officio, nonvoting member.
Members appointed to the board may include members or employees of the appointing authorities set forth in subdivision (a).
The board may appoint an executive director to serve at the pleasure of the authority.
The executive director is exempt from all civil service provisions and shall be paid a salary established by the board.
The executive director may appoint staff or retain consultants as necessary to carry out the duties of the authority.
All contracts approved and awarded by the executive director shall be awarded in accordance with state and federal laws relating to procurement. Awards shall be based on price or competitive negotiation, or on both of those things.
The LACMTA shall identify and expeditiously enter into an agreement or agreements with the authority to do all of the following:
Hold in trust with the authority all real and personal property, and any other assets accumulated in the planning, design, and construction of the project, including, but not limited to, rights-of-way, documents, third-party agreements, contracts, and design documents, as necessary for completion of the project, unless otherwise agreed upon by the LACMTA and the authority.
Outline the design review, construction, and testing process that acknowledges LACMTA’s direct role in the review of the project to ensure the final project will be compatible, functionally connected, and operative within LACMTA’s existing metro rail system.
Describe the various funding sources and the obligations of the authority to assist LACMTA obtain federal, state, and local funds for the project, and the authority’s obligations and duties upon receipt of the funds necessary to construct the project.
Describe all financial elements of the project, and the budget approved for the project.
The authority shall enter into a memorandum of understanding with the LACMTA that shall specifically address the ability of the LACMTA to review any significant changes in the scope of the design or construction, or both design and construction, of the project. For purposes of this section, the term “significant change” means any change of mode or technology, or any other substantive change that affects the connectivity and operation of the project as part of the overall transit system operated by the LACMTA, or any combination of those things. Design and construction of a light rail project that is consistent with the current scope of the project shall not be deemed to be a significant change in the scope of the project and shall not require concurrence by the LACMTA.
The authority shall not encumber any future farebox revenue anticipated from the operation of the project.
The authority shall not encumber the project with any obligation that is transferable to the LACMTA upon completion of the design and construction of the project. The design and construction to be administered by the authority does not include rolling stock and fare collection equipment, which is a component of the operation of the project and shall be provided and administered by the LACMTA.
The authority shall be dissolved upon completion of construction of the light rail project. The LACMTA shall assume responsibility for operating the project upon completion of the project or any of its phases.
CHAPTER 8. Tri-Valley-San Joaquin Valley Regional Rail Authority [132651. - 132661.]
As used in this chapter, the following terms have the following meanings:
“Authority” means the Tri-Valley-San Joaquin Valley Regional Rail Authority created under this chapter.
“Bay Area Rapid Transit” (BART) means the Bay Area Rapid Transit District.
“Board” means the governing board of the authority.
“Connectivity” means one or more projects necessary to achieve transit connectivity between BART’s rapid transit system and the San Joaquin Regional Rail Commission’s Altamont Corridor Express commuter rail service, and to provide quality, seamless service to riders using the services operating between the Tri-Valley and the San Joaquin Valley.
“Tri-Valley” means the Cities of Danville, Dublin, Livermore, Pleasanton, and San Ramon.
The authority is hereby established for purposes of planning, developing, delivering, and operating cost-effective and responsive transit connectivity, between BART’s rapid transit system and the Altamont Corridor Express commuter rail service, that reflects regional consensus and meets the goals and objectives of the San Joaquin Valley and Tri-Valley communities, consistent with the project feasibility report adopted pursuant to Section 132661.
The authority shall be considered a rail transit district for the purposes set forth in Article 5 (commencing with Section 53090) of Chapter 1 of Part 1 of Division 2 of Title 5 of the Government Code.
The governing board of the authority shall be composed of one representative from each of the following entities to be appointed by the governing board, mayor, or supervisor of each entity:
The Bay Area Rapid Transit District.
The City of Dublin.
The City of Lathrop.
The City of Livermore.
The City of Manteca.
The City of Pleasanton.
The City of Stockton.
The City of Tracy.
The County of Alameda.
The County of San Joaquin.
The Livermore Amador Valley Transit Authority.
The City of Mountain House.
The San Joaquin Regional Rail Commission.
The City of Danville.
The City of San Ramon.
The authority has all of the powers necessary for planning, acquiring, leasing, developing, jointly developing, owning, controlling, using, jointly using, disposing of, designing, procuring, and constructing facilities to achieve transit connectivity, including, but not limited to, all of the following:
Acceptance of grants, fees, allocations, and transfers of moneys from federal, state, and local agencies, including, but not limited to, moneys from local measures, as well as private entities.
Acquiring, through purchase or through eminent domain proceedings, any property necessary for, incidental to, or convenient for, the exercise of the powers of the authority.
Incurring indebtedness, secured by pledges of available revenue.
Contracting with public and private entities for the planning, design, and construction of the connection. These contracts may be assigned separately or may be combined to include any or all tasks necessary to achieve transit connectivity, and may extend to work on the state highway system for the construction of passenger rail service through the Altamont Pass Corridor.
Contracting pursuant to paragraph (1) may include the use of the Construction Manager/General Contractor project delivery method, pursuant to Chapter 6.7 (commencing with Section 6970) of Part 1 of Division 2 of the Public Contract Code.
Contracts authorized pursuant to paragraph (1) shall not include the authority to perform construction inspection services for projects on, or interfacing with, the state highway system. The Department of Transportation shall perform construction inspection services for these projects consistent with Section 91.2 of the Streets and Highways Code.
Entering into cooperative or joint development agreements with local governments or private entities necessary to achieve transit connectivity. These agreements may be entered into for purposes of sharing costs, selling or leasing land, air, or development rights, providing for the transferring of passengers, making pooling arrangements, or for any other purpose that is necessary for, incidental to, or convenient for the full exercise of the powers granted to the authority. For purposes of this subdivision, “joint development” includes, but is not limited to, an agreement with any person, firm, corporation, association, or organization for the operation of facilities or development of projects adjacent to, or physically or functionally related to, achieving transit connectivity.
Relocation of utilities, as necessary to achieve transit connectivity.
For an initial 18-month period, the Livermore Amador Valley Transit Authority’s administrative staff shall, if that authority has appointed a member to the board in accordance with Section 132655, provide all necessary administrative support to the board to perform its duties and responsibilities. At the conclusion of the initial period, the board may select the Livermore Amador Valley Transit Authority or the San Joaquin Regional Rail Commission to provide administrative support, or may alternatively hire an executive director for those functions. If an executive director is hired, the executive may appoint staff or retain consultants as necessary to carry out the duties of the authority.
The unencumbered balance of all local funds programmed for the completion of the BART Livermore extension or that have otherwise been identified for the connectivity shall be transferred to the authority and be considered resources available to effectuate the authority’s purposes pursuant to this chapter, except that local funds controlled by the Alameda County Transportation Commission to be used for completion of the BART Livermore extension or that have otherwise been identified for the connectivity shall continue to be programmed and allocated by the Alameda County Transportation Commission pursuant to measures approved by the voters of Alameda County pursuant to Division 19 (commencing with Section 180000).
The unencumbered balance of all local funds programmed for the completion of the BART Livermore extension shall be transferred to the authority and be considered resources available to effectuate the authority’s purposes pursuant to this chapter, except that local funds controlled by the San Joaquin Regional Rail Commission that have otherwise been identified for connectivity shall continue to be programmed and allocated by the San Joaquin Regional Rail Commission pursuant to measures approved by the voters of San Joaquin County pursuant to Division 19 (commencing with Section 180000).
The authority is eligible to apply for and receive state and federal funds to perform its duties pursuant to this chapter.
The authority may pursue any and all sources of funding to achieve connectivity except that the authority shall not apply for funds available under the Transportation Development Act (Chapter 4 (commencing with Section 99200) of Part 11 of Division 10) for which any member entity of the authority may also be an applicant or for which any member entity of the authority is charged with approving applications for funding under that act, without the express written consent of that affected member entity.
The authority may enter into agreements with the Bay Area Rapid Transit District, the San Joaquin Regional Rail Commission, or any other entity to address any and all issues necessary to achieve transit connectivity, consistent with the project feasibility report’s findings, conclusions, and recommendations adopted pursuant to Section 132661.
If the project feasibility report includes a recommendation for an extension of BART’s rapid transit system, the governing board of the Bay Area Rapid Transit District shall have the authority to approve or deny the recommendation.
If the project feasibility report includes a recommendation for an extension of the Altamont Corridor Express commuter rail service, the governing board of the San Joaquin Regional Rail Commission shall have the authority to approve or deny the recommendation.
The authority and any entity contracted with to serve as the operator of any transit connectivity developed and delivered pursuant to this chapter shall be subject to all of the following:
The Meyers-Milias-Brown Act (Chapter 10 (commencing with Section 3500) of Division 4 of Title 1 of the Government Code).
The California Public Records Act (Division 10 (commencing with Section 7920.000) of Title 1 of the Government Code).
The Ralph M. Brown Act (Chapter 9 (commencing with Section 54950) of Part 1 of Division 2 of Title 5 of the Government Code).
On or before July 1, 2019, the authority shall provide a project feasibility report to the public, to be posted on the authority’s internet website, on the plans for the development and implementation of transit connectivity. The report, at a minimum, shall include the following elements:
Recommendations for expediting the development of cost-effective and responsive transit connectivity between BART’s rapid transit system and the Altamont Corridor Express commuter rail service.
The identification of a preferred entity or entities to deliver transit connectivity, including the role each entity will play in planning, designing, financing, constructing, operating, maintaining, and the leasing, developing, or disposing of land, facilities, or equipment, necessary to deliver and operate transit connectivity.
A funding plan describing any grants, loans, allocations, fund transfers, or awards of local, regional, state, federal, or private funds that are proposed to be made available for achieving transit connectivity.
A description of any plan to finance the development of transit connectivity, including a description of any revenue source or sources to be pledged for financing, the duration of time to complete the financing, and the estimated total cost of financing.
A proposed schedule for the completion of transit connectivity.
A preliminary design for the project or projects to complete transit connectivity, including the identification of right-of-way, routes, stations, equipment, and any other facilities necessary to achieve transit connectivity.
The authority may use any relevant environmental review documents previously completed by the Bay Area Rapid Transit District or the San Joaquin Regional Rail Commission to prepare the report specified in subdivision (a).
Upon completion and approval by the authority of the project feasibility report required under subdivision (a), the authority shall submit the report to the Metropolitan Transportation Commission, the governing board of the Bay Area Rapid Transit District, the governing board of the San Joaquin Regional Rail Commission, the policy committees of each house of the Legislature with jurisdiction over transportation policy matters, and the Transportation Agency.
DIVISION 12.8. Imperial County Transportation Commission [132800. - 132824.]
CHAPTER 1. General Provisions and Creation of Commission [132800. - 132801.]
There is hereby created the Imperial County Transportation Commission. The commission shall be the successor agency to the Imperial Valley Association of Governments and shall assume all assets and liabilities of that entity. The area of jurisdiction of the commission shall consist of all of the incorporated and unincorporated area of Imperial County.
The governing board of the commission shall consist of the following members:
Two members of the Imperial County Board of Supervisors. The term of a member under this paragraph terminates when he or she ceases to hold that office or when replaced by the board of supervisors.
One member from each incorporated city within Imperial County who shall be the mayor of the city or a member of its city council. The term of a member under this paragraph terminates when he or she ceases to hold that office or when replaced by the city council.
One member of the board of directors of the Imperial Irrigation District. The term of a member under this paragraph terminates when he or she ceases to hold that office or when replaced by the board of directors of the district.
One nonvoting member appointed by the Governor representing the Department of Transportation.
The governing board of the commission may also include the following nonvoting members:
One member representing the State of Baja California, Mexico, who may be appointed by the governor of the state.
One member representing the municipality of Mexicali, Mexico, who may be the mayor or his or her designee.
One member representing the Consul of Mexico in Calexico, California, who may be the consul or his or her designee.
One member representing any federally recognized Native American tribe in Imperial County.
CHAPTER 2. Administration [132810. - 132816.]
The governing board of the commission at its first meeting, and thereafter annually at the first meeting in January, shall elect a chairperson from its members who shall preside at all meetings, and a vice chairperson who shall preside in his or her absence. In the event of their absence or inability to act, the members present, by an order entered in the minutes, shall select one of their members to act as chairperson pro tempore, who, while so acting shall have all of the authority of the chairperson.
The board shall establish rules for its proceedings consistent with the law of the State of California.
A majority of the voting members of the board shall constitute a quorum for the transaction of business and all official acts of the commission. All official acts of the board require the affirmative vote of the majority of the voting members of the board.
The acts of the board shall be expressed by motion, resolution, or ordinance.
All meetings of the board shall be conducted in the manner prescribed by the Ralph M. Brown Act (Chapter 9 (commencing with Section 54950) of Part 1 of Division 2 of Title 5 of the Government Code).
All meetings of committees established by the board shall be held pursuant to Section 54952.3 of the Government Code, and no other provision of the Ralph M. Brown Act shall apply to meetings of those committees.
Any committee of the board shall have a membership of at least three voting members.
The board shall do the following:
Adopt an annual budget and fix the compensation of its officers and employees.
Adopt an administrative code, by ordinance, which shall prescribe the powers and duties of commission officers, the method of appointment of commission employees, and methods, procedures, and systems of operation and management of the commission.
Cause a postaudit of the financial transactions and records of the commission to be made at least annually by a certified public accountant.
Appoint a technical advisory committee of representatives from all of the transit operators in the county, all of the incorporated cities in the county, the county, and the Department of Transportation.
Appoint such other advisory committees the board deems necessary.
Notice of time and place of the public hearing for the adoption of the annual budget shall be published pursuant to Section 6061 of the Government Code, and shall be published not later than the 15th day prior to the date of the hearing. The proposed annual budget shall be available for public inspection at least 15 days prior to the hearing.
CHAPTER 3. Powers and Functions [132820. - 132824.]
The commission may do any of the following:
Use up to 3 percent of the revenues in the local transportation fund for purposes of carrying out its transportation planning and programming responsibilities.
Sue and be sued.
Enter into contracts with qualified vendors to further the purposes of the commission.
Do any and all things necessary to carry out the purposes of this division.
The commission, in cooperation with local agencies that elect to participate, may, within the boundaries of the County of Imperial, assist those agencies in the coordination, administration, and implementation of programs and policies.
The commission may evaluate, develop, and implement nontransportation programs that it determines would provide local benefits by consolidating and sharing costs and resources, by facilitating local agency cooperation, or by operating under the commission’s management. These nontransportation programs include providing animal control services, waste management services, emergency response services, and multiagency communication services during countywide natural disasters such as earthquakes, fires, and floods.
The commission may develop or implement a nontransportation program only upon a majority vote of, and the adoption of a resolution by, the commission’s board.
Consistent with this section, the commission may function as a regional agency for purposes of Article 3 (commencing with Section 40970) of Chapter 1 of Part 2 of Division 30 of the Public Resources Code.
Consistent with this section, the commission, upon adoption of a resolution by its board, may function as the service authority for freeway emergencies for the County of Imperial pursuant to Section 2551 of the Streets and Highways Code.
The commission may apply for, and receive, moneys and grants available to carry out its functions.
The commission shall not use transportation moneys for nontransportation purposes.
Revenues from the County of Imperial sales tax extended pursuant to local Measure D, which was approved by voters at the November 4, 2008, statewide general election, shall not be used for purposes of this section.
For purposes of this section, “local agency” means a county, city, whether general law or chartered, city and county, town, municipal corporation, district, political subdivision, or any board, commission, or agency thereof, or other local public agency.
The commission shall undertake the following:
Prepare a short-range transportation plan that includes the development and approval of a three- to five-year transportation improvement program, as follows:
The transportation improvement program shall apply to all projects funded with federal, state, and local funds.
The transportation improvement program shall be developed in coordination and consultation with the multicounty designated transportation planning agency, and shall be consistent with that agency’s regional transportation plan.
The county commission and the multicounty designated transportation planning agency shall enter into a memorandum of understanding specifying the process for preparing the transportation improvement program.
The commission shall consult with its member agencies, the Department of Transportation, adjacent counties, and other entities public and private when preparing its short-range plan and transportation improvement program.
The commission shall be responsible for administering the funds deposited in the local transportation fund according to the terms and conditions of the Mills-Alquist-Deddeh Act (Chapter 4 (commencing with Section 99200) of Part 11 of Division 10), which is also known as the Transportation Development Act, or any successor to that act.
The commission shall be responsible for preparing the short-range transit plan required by the Transportation Development Act.
DIVISION 13.1. SANTA CLARA COUNTY TRAFFIC AUTHORITY [140280. - 140280.]
The repeal of Division 13 (commencing with Section 140000), and the termination of the Santa Clara County Traffic Authority, do not impair either the validity of any transactions and use tax imposed by the authority prior to its termination, or the power or obligation of the State Board of Equalization to administer the collection of the tax, including audits and prosecutions related to the tax. Upon notice to the State Board of Equalization, given in accordance to the notice procedures specified in the Agreement for the State Administration of District Transactions and Use Taxes executed between the Santa Clara County Traffic Authority and the board, the authority may assign and sell to another legal entity the right to receive the revenue derived from the tax and determined by the State Board of Equalization to be available for transmittal. The State Board of Equalization shall be bound by that assignment upon the required notice. If the authority does not assign the right to receive the revenue derived from the tax, the revenue shall be transmitted to the Santa Clara County Transit District. All revenue transmitted to the Santa Clara County Transit District pursuant to this section shall be expended solely for purposes authorized by Division 13 (commencing with Section 140000) prior to the repeal of that division. The right to receive the assigned revenues shall be limited to the receipt thereof, and shall not extend to any audit privileges or access to confidential information of the State Board of Equalization.
Notwithstanding Chapter 6 (commencing with Section 57450) of Part 5 of Division 3 of Title 5 of the Government Code, upon termination of the Santa Clara County Traffic Authority, the Santa Clara County Transit District shall be the successor for purposes of winding up the affairs of the traffic authority.
DIVISION 14. COACHELLA VALLEY INTERMODAL TRANSPORTATION AUTHORITY [141000. - 141050.]
For purposes of this division, the following terms have the following meanings:
The “authority” is the Coachella Valley Intermodal Transportation Authority and its 11 districts created under this division.
The “board” is the board of directors of the authority, appointed under Section 141010.
The “district” may be any of the following:
The incorporated boundary of any one of the Coachella Valley members of the Coachella Valley Association of Governments.
The unincorporated area of Riverside County within the Coachella Valley.
The incorporated boundary of the City of Blythe.
The “district board” is the legislative body of the district.
The Coachella Valley Intermodal Transportation Authority is hereby created to serve as the governing agency for its 11 separate districts, recognized in that capacity by the Coachella Valley Association of Governments, the Riverside County Transportation Commission, and the United States Department of Transportation, for the following purposes:
Serving as the primary authority for managing and operating intermodal passenger transportation and related infrastructure.
Serving as the primary authority for intermodal less-than-carload freight transportation and related infrastructure within the Coachella Valley and eastern Riverside County.
Serving as the primary authority for facilities and services and related infrastructure.
Establishing, maintaining, and operating an independent political and administrative structure by which to implement passenger and freight transportation initiatives.
Completing planning and environmental studies to ascertain project feasibility.
Being available for designation as the lead agency for purposes of environmental review, entitlement permitting, and public participation.
Acquiring, by grant, purchase, condemnation, gift, devise, or lease, and holding, using, selling, leasing or disposing of, any real and personal property necessary for the full exercise, or convenient or useful for the carrying on of, any of the authority’s powers.
Fixing rates, parking fees, charges, or rents for the use of any facilities acquired, constructed, operated, or maintained by the authority or any of its districts, and modifying the same at its pleasure, subject to any contractual obligation that may be entered into by the authority with respect to the fixing of those rates, fees, charges, or rents.
Obtaining funds for, and sustaining the planning, development, maintenance, and operation of, the Coachella Valley and City of Blythe Intermodal Transportation Center.
Accepting gifts, subventions, grants, rebates, and subsidies from any source.
Entering into indentures.
Issuing tax-exempt revenue bonds and coupons.
Spending moneys and incurring indebtedness to fulfill its purposes.
The authority shall be governed by the Executive Committee of the Coachella Valley Association of Governments.
A district shall be governed by the elected legislative body of that particular political entity.
The board and all district boards shall do all of the following:
Elect a chairperson, vice chairperson, and secretary.
Supervise and regulate all facilities owned by, and all operations of, the authority or the district, whichever is applicable.
Enter into contracts necessary for the full exercise of the power of the authority or district.
Conduct an annual audit of all accounts of the authority or district.
All meetings of the board or the district boards shall be conducted in accordance with Chapter 9 (commencing with Section 54950) of Part 1 of Division 2 of Title 5 of the Government Code.
No officer or employee of the authority or any district shall in any manner be interested, directly or indirectly, in any contract awarded, or to be awarded by, the board or district boards, or in the profits to be derived therefrom contrary to the provisions of Article 4 (commencing with Section 1090) of Chapter 1 of Division 4 of Title 1 of the Government Code.
The authority or any of the districts, either in conjunction with the authority or any other of the districts or individually, may issue general and special revenue bonds for the acquisition, construction, or completion of any works, equipment, materials, supplies, properties, or structures necessary or convenient to carry out the objects and purposes of this division.
The total amount of bonds outstanding shall not be in excess of one hundred million dollars ($100,000,000) at any one time per district.
Each separate improvement shall be designated as a “project” and the purpose, nature, and extent thereof shall be described in general terms prior to the issuance of any bonds.
The validity of the authorization and issuance of any revenue bonds by the authority or the districts is not dependent on nor affected in any way by any of the following:
Proceedings taken by the authority or the districts for the acquisition, construction, or completion of any improvement or any part thereof.
Any contracts made by the authority or the districts for the acquisition, construction, or completion of any improvements.
The failure to complete any improvements for which bonds are authorized to be issued.
The authority or any district shall issue revenue bonds in its name only. These bonds shall constitute obligations of the authority or district only, and neither the payment of principal or interest of any bond constitutes a debt, liability, or obligation of the State of California. The authority or district shall determine the time, form, and manner of the issuance of revenue bonds.
The authority or the districts may enter into indentures providing the aggregate principal amount, date or dates, maturities, interest rate, denomination, form, registration transfer, and interchange of the bonds and coupons and the terms and conditions upon which the bonds and coupons shall be executed, issued, secured, sold, paid, redeemed, funded, and refunded. Reference to this division shall be made on the face of the bonds to those indentures by its date of adoption, or the apparent date, on the face thereof and into the body of these bonds and their appurtenant coupons. Each taker and subsequent holder of these bonds or coupons, whether the coupons are attached or detached from the bonds, has recourse to all of the provisions of the indenture and of this division, and is bound thereby.
The authority may acquire, construct, own, operate, control, or use right-of-way, rail lines, bus lines, stations, platforms, switches, yards, terminals, and any and all other facilities, equipment, and infrastructure necessary and convenient to provide intermodal transportation services, together with all physical structures necessary or convenient for the access of persons and vehicles thereto.
The authority or districts may acquire any interest in, or rights to, the joint use of any or all of the things listed in subdivision (a). However, installations in any street, road, or other property devoted to a public use shall be subject to consent of the governing body in charge of that public use.
The authority or the districts shall not interfere with, or exercise any control over, any transit facilities now or hereafter owned and operated wholly or partially within the district by any city or public agency, unless by consent of the city or public agency, and upon any terms that are mutually agreed upon between the board and the city or public agency.
DIVISION 15. FRESNO COUNTY TRANSPORTATION AUTHORITY [142000. - 142277.]
CHAPTER 1. General Provisions [142000. - 142010.]
This division shall be known and may be cited as the Fresno County Transportation Improvement Act.
The Legislature hereby finds and declares all of the following:
In Fresno County, regional transportation improvements and local transportation improvements and services are an immediate high priority needed to resolve the county’s transportation problems that threaten the economic viability and development potential of the county and adversely impact the quality of life therein.
In order to deal in an expeditious manner with current and future transportation problems, the county needs to develop and implement a local funding program that goes significantly beyond current federal and state funding which is inadequate to resolve these problems.
It is in the public interest to allow the voters of Fresno County to continue the Fresno County Transportation Authority so that local transportation decisions can be implemented in a timely manner to provide regional transportation improvements and to meet local transportation needs.
It is the intent of the Legislature that funds generated pursuant to this division not replace property tax revenues which would otherwise be expended for roads and transportation purposes.
This division shall be liberally construed in order to effectuate its purposes. No inadvertent error, irregularity, informality, or the inadvertent neglect or omission of any officer, in any procedure taken under this division, other than fraud, shall void or invalidate that proceeding or any levy imposed to finance highway improvements or local transportation needs.
“Authority” means the Fresno County Transportation Authority created pursuant to this division in the County of Fresno.
“Board of supervisors” means the Fresno County Board of Supervisors.
“County” means the County of Fresno.
“Fresno-Clovis Metropolitan Area” means that area within the adopted spheres of influence of the Cities of Fresno and Clovis, as approved and amended by the local agency formation commission.
“Transportation planning agency” means the Council of Fresno County Governments or any other agency which may be designated by the Governor as responsible for regional transportation planning within the county to comply with federal and state requirements.
The authority is terminated two years from the last day on which the transactions and use tax authorized by this division is collected and as of that date this division is repealed.
CHAPTER 2. Creation Of The Authority [142050. - 142052.]
The Fresno County Transportation Authority is hereby continued in the county, as originally created by this section.
The authority shall consist of nine members selected as follows:
Two members of the board of supervisors appointed by the board, consisting of one member from rural district 1, 4, or 5 and one member from urban district 2 or 3.
Two members representing the City of Fresno, consisting of the mayor thereof and a member of the city council of that city appointed by the city council.
One member representing the City of Clovis appointed by the city council of that city.
Two members representing the other cities within the county, consisting of one westside member appointed by a committee comprised of the mayors of each of those cities west of State Highway Route 99, and one eastside member appointed by a committee comprised of the mayors of each of those cities east of State Highway Route 99.
Two members of the public at large, consisting of one member appointed by the board of supervisors with the appointee residing outside of the incorporated areas of Fresno and Clovis, and one member appointed jointly by the city councils of Fresno and Clovis with the appointee residing within the incorporated area of Fresno or Clovis.
Except for the Mayor of the City of Fresno, the members of the authority shall serve for a term of two years.
If any member other than the public member ceases to be an elected official, that member shall cease to be a member of the authority, and another member shall be appointed for the remainder of the term pursuant to Section 142051.
CHAPTER 3. Administration [142100. - 142109.]
The authority, at its first meeting, and thereafter annually at the first meeting in January, shall elect a chairperson who shall preside at all meetings, and a vice chairperson who shall preside in his or her absence. In the event of their absence or inability to act, the members present, by an order entered into the minutes, shall select one of their members to act as chairperson pro tempore, who, while so acting, shall have all the authority of the chairperson.
The authority shall adopt rules for its proceedings consistent with the law of the state.
A majority of the members of the authority constitutes a quorum for the transaction of business, and all official acts of the authority require the affirmative vote of the majority of the members of the authority.
The acts of the authority shall be expressed by motion, resolution, or ordinance.
All meetings of the authority shall be conducted pursuant to Chapter 9 (commencing with Section 54950) of Part 1 of Division 2 of Title 5 of the Government Code.
The authority shall do all the following:
Adopt an annual budget.
Adopt an administrative code, by ordinance, which prescribes the powers and duties of the authority officers, the method of appointment of the authority employees, and methods, procedures, and systems of operations and management of the authority.
Cause a postaudit of the financial transactions and records of the authority to be made at least annually by a certified public accountant.
Appoint a policy advisory committee composed of one representative of each city in the county and one representative of the county. Each representative on the committee shall be an elected official. If a representative ceases to be an elected official, that representative shall cease to be a member of the committee, and another representative from that city or county, as the case may be, shall be appointed. No person shall serve on the authority and on the committee at the same time.
Establish a citizens oversight committee with membership, method of appointment, roles, and responsibilities in accordance with and as defined in the initial expenditure plan prepared for the purposes of the extension of the retail transactions and use tax.
Do any and all things necessary to carry out the purposes of this division.
The authority may hire an independent staff of its own or contract with any department or agency of the United States or with any public agency to implement this division.
The authority shall fix the compensation of its officers and employees.
Notice of the time and place of a public hearing on the adoption of the annual budget shall be published pursuant to Section 6061 of the Government Code not later than the 15th day prior to the day of the hearing.
The proposed annual budget shall be available for public inspection at least 15 days prior to the hearing.
The authority shall rely, to the extent possible, on existing state, regional, and local transportation planning and programming data and expertise, rather than on a large duplicative staff and set of plans.
The authority shall not expend more than 1 percent of the funds generated pursuant to this division in any year for salary and benefits of its staff.
CHAPTER 4. Powers and Functions [142150. - 142155.]
The authority may adopt a seal and alter it at its pleasure.
The authority may sue and be sued, except as otherwise provided by law, in all actions and proceedings, in all courts and tribunals of competent jurisdiction.
All claims for money or damages against the authority are governed by Division 3.6 (commencing with Section 810) of Title 1 of the Government Code, except as provided therein, or by other statutes or regulations expressly applicable thereto.
The authority may make contracts and enter into stipulations of any nature whatsoever, either in connection with eminent domain proceedings or otherwise, including, but not limited to, contracts and stipulations to indemnify and hold harmless, to employ labor, and to do all acts necessary and convenient for the full exercise of the powers granted in this division.
The authority may contract with any department or agency of the United States, with any public agency, including, but not limited to, the Department of Transportation, the Council of Fresno County Governments, or any county, city, or district, or with any person upon any terms and conditions that the authority finds in its best interest.
Contracts for the purchase of services, supplies, equipment, and materials in excess of ten thousand dollars ($10,000) shall be awarded to the lowest responsible bidder after competitive bidding, except in an emergency declared by the authority or by an executive committee to which the authority has delegated responsibility to make that declaration.
If, after rejecting bids received under subdivision (a), the authority determines and declares that, in its opinion, the services, supplies, equipment, or materials may be purchased at a lower price on the open market, the authority may proceed to purchase these services, supplies, equipment, or materials in the open market without further observance of the provisions regarding contracts, bids, or advertisements.
CHAPTER 5. Transportation Coordination [142200. - 142201.]
The authority shall consult with, and coordinate its actions to secure funding for the completion and improvement of the priority regional transportation improvements with the cities in the county, the board of supervisors, the Council of Fresno County Governments, and the Department of Transportation for the purpose of integrating its planned improvements with the other transportation improvement plans and operations of other transportation agencies impacting the county.
The authority shall prepare and adopt an annual report each year on progress made to achieve the objective of improving transportation conditions related to priority regional transportation improvements and other local transportation needs.
CHAPTER 6. Transactions and Use Taxes [142250. - 142277.]
A retail transactions and use tax ordinance, applicable in the incorporated and unincorporated territory of the county may be imposed by the authority in accordance with Section 142262 of this code and Part 1.6 (commencing with Section 7251) of Division 2 of the Revenue and Taxation Code, if two-thirds of the electors voting on the measure vote to approve the imposition of the tax at an election which shall be called for that purpose by resolution of the board of supervisors.
The election shall be held in the November 2002 or a subsequent general election.
The authority, in the retail transactions and use tax ordinance, shall state the nature of the tax to be imposed, shall provide the tax rate or rates or the maximum tax rate or rates, shall specify the purposes for which the revenue derived from the tax will be used, and may set a term, not to exceed 30 years, during which the tax may be imposed.
The county shall conduct an election called by the board of supervisors to implement this chapter pursuant to Section 142250, and the authority shall reimburse the county for the county’s costs in conducting the election.
The election shall be called and conducted in the same manner as provided by law for the conduct of elections by a county.
Any retail transactions and use tax ordinance adopted pursuant to this chapter shall be operative on the first day of the first calendar quarter commencing more than 120 days after adoption of the ordinance.
The revenues from the retail transactions and use taxes imposed pursuant to this chapter may be allocated by the authority for the administration of this division and for transportation improvement purposes, including administration of this division, legal actions related thereto, planning, environmental reviews, design, construction, and repair.
A county transportation expenditure plan shall be prepared by the transportation planning agency for the expenditure of the revenues expected to be derived from the tax imposed pursuant to this chapter, together with other federal, state, and local funds expected to be available for transportation improvements, for the period during which the tax is to be imposed.
A county transportation expenditure plan shall not be adopted by the authority until it has received the approval of the board of supervisors and of the city councils representing both a majority of the cities in the county and a majority of the population residing in the incorporated areas of the county.
The plan shall be adopted prior to the call of the election provided for in Section 142250.
The expenditure plan shall specify the amount and the formula by which the retail transactions and use tax shall be allocated to each city and the county for local transportation purposes determined to be priority projects by local governments to which funds are allocated.
For purposes of this subdivision, the population of the county is the population of the unincorporated area of the county.
Prior to the authority allocating funds, each local government shall certify to the authority that the funds will not be substituted for property tax funds which are currently utilized to fund existing local transportation programs. If the local government is unable to segregate property tax revenues from other general fund revenues which cannot be so distinguished, substitution of funds from the authority for general funds is also prohibited.
The authority shall require that local governments to which funds are allocated to separately account for those funds and maintain records of expenditures in accordance with administrative code requirements adopted by the authority.
Except as otherwise provided by Section 142260, the transportation planning agency may amend the expenditure plan. The transportation planning agency, at a minimum, shall review biennially and assess the needs for transportation improvements contained in the expenditure plan as specified in Section 142255. As part of this review and assessment, the transportation planning agency may solicit proposals for transportation improvements from the Department of Transportation and the cities and the county. The transportation planning agency shall adopt a procedure for evaluating these proposals in consultation with the Department of Transportation and the cities and the county.
Based on the evaluation, the transportation planning agency shall prepare an updated plan for the expenditure of the revenues expected to be derived from the retail transactions and use tax imposed pursuant to this chapter, together with other federal, state, and local improvements, for the period during which the tax is imposed. The first five years of the plan shall be incorporated into the transportation planning agency’s annual submission to the California Transportation Commission for the state transportation improvement program pursuant to Chapter 2.5 (commencing with Section 65080) of Division 1 of Title 7 of the Government Code.
The expenditure plan shall also include projections of revenues likely to be available from other federal, state, and local funds expected to be available for expenditure plan transportation improvements for the period during which the tax is imposed.
Before adoption of an expenditure plan, the transportation planning agency shall conduct public hearings on the plan.
Amendments to the expenditure plan adopted pursuant to Section 142255 are to provide for the use of additional federal, state, and local funds, to account for unexpected revenues, or to take into consideration unforeseen circumstances. The transportation planning agency shall take all appropriate actions to give highest priority to the projects in the initial expenditure plan, and any amendments shall not delay or delete any project in the initial plan without the transportation planning agency holding a public hearing and documenting within the plan the reason why the amendments are being recommended to the authority and are necessary relative to conditions beyond control of the authority.
The authority may, by the affirmative vote of a majority of the members, approve the updated expenditure plan adopted pursuant to Section 142258.
The authority may amend the expenditure plan adopted pursuant to Section 142258, if required, subject to all of the following conditions:
The authority shall take all appropriate actions to give highest priority to the projects in the initial expenditure plan, and if any amendments delay or delete any project in the initial plan, the authority shall hold a public hearing and adopt a resolution initiating the amendments that specifically detail the reason why the amendments are necessary relative to conditions beyond the control of the authority.
The authority shall notify the transportation planning agency, the board of supervisors, and the city council of each city in the county and provide them with a copy of the proposed amendments.
The amendment is approved by the board of supervisors.
The amendment is approved by a majority of the cities constituting a majority of the population residing in the incorporated areas of the county.
The proposed amendments shall become effective immediately upon completion of the approval process in subdivision (b).
If a retail transactions and use tax is adopted pursuant to this chapter, the authority shall prepare and submit a report to the Department of Transportation, to the board of supervisors, to the city council of each city in the county, and to the transportation planning agency, on or before each January 1 after taxes are imposed pursuant to this chapter. The report shall evaluate and report the progress made in implementing the expenditure plan during the preceding fiscal year.
The authority, subject to the approval of the voters, may impose the retail transactions and use tax at a maximum rate of one-half of 1 percent under this chapter and Part 1.6 (commencing with Section 7251) of Division 2 of the Revenue and Taxation Code, and may state the maximum tax rate in terms of not to exceed one-half of 1 percent.
The board of supervisors, or its designee, as part of the ballot proposition to approve the imposition of a retail transactions and use tax, shall seek authorization from the electors to issue bonds payable solely from the proceeds of the tax.
The maximum bonded indebtedness which may be authorized shall be an amount equal to the sum of the principal and interest on the bonds, not to exceed the estimated proceeds of the tax, for a period of not more than 30 years. The actual wording of the proposition on any short form of ballot card, label, or other device, regardless of the system of voting used, shall include all of the following:
The nature of the tax to be imposed.
The tax rate or the maximum tax rate.
The period during which the tax will be imposed.
The purposes for which the revenue derived from the tax will be used.
The sample ballot to be mailed to the voters, pursuant to Section 13303 of the Elections Code, shall include the full proposition, and the voter information handbook shall include the entire expenditure plan adopted by the authority.
The bonds authorized by the voters concurrently with the approval of the retail transactions and use tax may be issued by the authority at any time, and from time to time, payable solely from the proceeds of the tax. The bonds shall be referred to as “limited tax bonds.”
The pledge of the tax to the limited tax bonds authorized under this chapter has priority over the use of any of the tax for pay-as-you-go financing, except to the extent that that priority is expressly restricted in the resolution authorizing the issuance of the bonds.
Limited tax bonds shall be issued pursuant to a resolution adopted at any time by an affirmative vote of a majority of the members of the authority. Each resolution shall provide for the issuance of bonds in the amounts as may be necessary, until the full amount of the bonds authorized have been issued. The full amount of bonds may be divided into two or more series and different dates of payment fixed for the bonds of each series. A bond need not mature on its anniversary date.
A resolution authorizing the issuance of limited tax bonds shall state all of the following:
The purpose for which the proposed debt is to be incurred, which may include all costs and estimated costs incidental to or connected with the accomplishment of those purposes, including, without limitation, engineering, inspection, legal, fiscal agents, financial consultant and other fees, bond and other reserve funds, working capital, bond interest estimated to accrue during the construction period and for a period not to exceed three years thereafter, and expenses of all proceedings for the authorization, issuance, and sale of the bonds.
The estimated cost of accomplishing those purposes.
The amount of the principal of the indebtedness.
The maximum term that the bonds proposed to be issued shall run before maturity, which shall not be beyond the date of termination of the imposition of the retail transactions and use tax.
The maximum rate of interest to be paid, which shall not exceed the maximum allowable by law.
The denomination or denominations of the bonds, which shall not be less than five thousand dollars ($5,000).
The form of the bonds, including, without limitation, registered bonds and coupon bonds, to the extent permitted by federal law, and the form of any coupons to be attached thereto, the registration, conversion, and exchange privileges, if any, pertaining thereto, and the time when all of, or any part of, the principal becomes due and payable.
The resolution may also contain any other matters authorized by this chapter or any other provision of law.
The bonds shall bear interest at a rate or rates not exceeding the maximum allowable by law, payable semiannually, except that the first interest payable on the bonds, or any series thereof, may be for any period not exceeding one year, as determined by the authority.
In the resolution authorizing the issuance of the bonds, the authority may also provide for call and redemption of the bonds prior to maturity at the times and prices and upon other terms as specified. However, no bond is subject to call or redemption prior to maturity unless it contains a recital to that effect or unless a statement to that effect is printed thereon.
The principal of, and interest on, the bonds shall be payable in lawful money of the United States at the office of the auditor-controller-treasurer of the county and other places as may be designated by the authority.
The bonds, or each series thereof, shall be dated and numbered consecutively and shall be signed by the chairperson or vice chairperson of the authority and the auditor-controller-treasurer of the county, and the official seal of the authority shall be attached.
The interest coupons of the bonds, if any, shall be signed by the auditor-controller-treasurer of the county.
All signatures and the seal may be printed, lithographed, or mechanically reproduced, except that one of the signatures on the bonds shall be manually affixed.
If any officer whose signature appears on the bonds or coupons ceases to be that officer before the delivery of the bonds, the officer’s signature is as effective as if the officer had remained in office.
The bonds may be sold as the authority determines by resolution. The authority may sell the bonds at a price below par, whether by negotiated or public sale.
Delivery of any bonds may be made at any place either inside or outside the state, and the purchase price may be received in cash or bank credits.
All accrued interest and premiums received on the sale of the bonds shall be placed in the fund to be used for the payment of principal of, and interest on, the bonds, and the remainder of the proceeds of the bonds shall be placed in the treasury of the authority and applied to secure the bonds or for the purposes for which the debt was incurred. However, when the purposes have been accomplished, any money remaining shall be either (a) transferred to the fund to be used for the payment of principal of, and interest on, the bonds or (b) placed in a fund to be used for the purchase of outstanding bonds of the authority from time to time in the open market at prices and in the manner, either at public or private sale or otherwise, as determined by the authority. Bonds so purchased shall be canceled immediately.
The authority may provide for the issuance, sale, or exchange or refunding bonds to redeem or retire any bonds issued by the authority upon the terms, at the times, and in the manner which it determines.
Refunding bonds may be issued in a principal amount sufficient to pay all, or any part of, the principal of the outstanding bonds, the premiums, if any, due upon call and redemption thereof prior to maturity, all expenses of the refunding, and either of the following:
The interest upon the refunding bonds from the date of sale thereof to the date of payment of the bonds to be refunded out of the proceeds of the sale of the refunding bonds or to the date upon which the bonds to be refunded will be paid pursuant to call or agreement with the holders of the bonds.
The interest upon the bonds to be refunded from the date of sale of the refunding bonds to the date of payment of the bonds to be refunded or to the date upon which the bonds to be refunded will be paid pursuant to call or agreement with the holders of the bonds.
The provisions of this chapter for the issuance and sale of bonds apply to the issuance and sale of refunding bonds.
The authority may borrow money in anticipation of the sale of bonds which have been authorized pursuant to this chapter, but which have not been sold and delivered, and may issue negotiable bond anticipation notes therefor and may renew the bond anticipation notes from time to time. However, the maximum maturity of any bond anticipation notes, including the renewals thereof, shall not exceed five years from the date of delivery of the original bond anticipation notes.
The bond anticipation notes, and the interest thereon, may be paid from any money of the authority available therefor, including the revenues from the retail transactions and use taxes imposed pursuant to this chapter. If not previously otherwise paid, the bond anticipation notes, or any portion thereof, or the interest thereon, shall be paid from the proceeds of the next sale of the bonds of the authority in anticipation of which the notes were issued.
The bond anticipation notes shall not be issued in any amount in excess of the aggregate amount of bonds which the authority has been authorized to issue less the amount of any bonds of the authorized issue previously sold, and also less the amount of other bond anticipation notes therefor issued and then outstanding. The bond anticipation notes shall be issued and sold in the same manner as the bonds.
The bond anticipation notes and the resolutions authorizing them may contain any provisions, conditions, or limitations which a resolution of the authority authorizing the issuance of bonds may contain.
Any bonds issued under this chapter are legal investments for all trust funds; for the funds of insurance companies, commercial and savings banks, and trust companies; and for state school funds; and whenever any money or funds may, by any law now or hereafter enacted, be invested in bonds of cities, counties, school districts, or other districts within the state, that money or funds may be invested in the bonds issued under this chapter; and whenever bonds of cities, counties, school district, or other districts within the state may, by any law now or thereafter enacted, be used as security for the performance of any act or the deposit of any public money, the bonds issued under this chapter may be so used. The provisions of this chapter are in addition to all other laws relating to legal investments and shall be controlling as the latest expression of the Legislature with respect thereto.
Any action or proceeding wherein the validity of the adoption of the retail transactions and use tax ordinance provided for in this chapter, or the issuance of any bonds thereunder, or any of the proceedings in relation thereto, is contested, questioned, or denied, shall be commenced within six months from the date of the election at which the ordinance is approved; otherwise, the bonds and all proceedings in relation thereto, including the adoption and approval of the ordinance, shall be held to be valid and in every respect legal and incontestable.
DIVISION 15.5. TUOLUMNE COUNTY TRAFFIC AUTHORITY [150000. - 150214.]
CHAPTER 1. General Provisions, Findings, and Definitions [150000. - 150010.]
This division shall be known and may be cited as the Tuolumne County Road Facilities Improvement Act.
The Legislature hereby finds and declares all of the following:
Recognizing the scarcity of resources available for all transportation development, the alternative methods of financing provided in this division are needed to finance the cost of maintaining, acquiring, constructing, and developing facilities for transportation systems in the County of Tuolumne and these methods will increase economic opportunities, contribute to economic development, be in the public interest and serve a public purpose, and promote the health, safety, and welfare of the citizens within the County of Tuolumne.
It is in the public interest to allow the voters of Tuolumne County to create the Tuolumne County Traffic Authority so that local decisions can be implemented in a timely manner to provide improvements to the transportation system.
“Bonds” means indebtedness and securities of any kind or class, including bonds, notes, bond anticipation notes, and commercial paper.
“Authority” means the Tuolumne County Traffic Authority created pursuant to this division in the County of Tuolumne.
“City” means the City of Sonora in the County of Tuolumne.
“County” means the unincorporated area of the County of Tuolumne.
“County of Tuolumne” and “Tuolumne County” mean the entire territory of the County of Tuolumne, including the territory of incorporated cities within the county.
“Electors” means the electors of the city with respect to a city ordinance, or the electors of the county with respect to a county ordinance.
“Ordinance” means either a city ordinance or a county ordinance, adopted pursuant to Section 150201, which imposes a retail transactions and use tax within the city or the county, respectively.
“Tuolumne County LTC” means the Tuolumne County and Cities Area Planning Council, the transportation planning agency for the county established pursuant to Section 29535 of the Government Code. Any board, commission, department, or officer succeeding to the functions of the LTC is granted the powers and duties of the LTC under this division.
“Voters” means the voters of the city with respect to a city ordinance, or the voters of the county with respect to a county ordinance.
CHAPTER 2. Creation of the Authority [150050. - 150052.]
There is hereby created the Tuolumne County Traffic Authority in the County of Tuolumne.
The appointed Commissioners of the Tuolumne County LTC shall serve as the Tuolumne County Traffic Authority.
The authority shall hire only that staff as may be necessary to meet its responsibilities, but shall strive to use the existing Tuolumne County LTC staff and committees to the greatest extent possible. The Tuolumne County LTC shall be reimbursed by the authority for any staff services it provides.
CHAPTER 3. Administration [150100. - 150105.]
The organization and procedures manual of the Tuolumne County LTC shall be the established rules for the proceedings and administration of the authority except as provided otherwise in this division.
Meetings of the authority shall be held at least annually and as often as determined necessary by the authority.
All meetings of the authority shall be conducted pursuant to Chapter 9 (commencing with Section 54950) of Part 1 of Division 2 of Title 5 of the Government Code.
The acts of the authority shall be expressed by motion, resolution, or ordinance.
The authority shall expend only that amount of the funds generated pursuant to this division for staff support, audit, administrative expenses, and contract services that are necessary and reasonable to carry out its responsibilities pursuant to this division.
The authority shall not expend more than 5 percent of the funds generated pursuant to this division in any year for salaries and benefits of its staff.
The authority shall do all of the following:
Adopt an annual budget.
Cause a postaudit of the financial transactions and records of the authority and of all revenues expended pursuant to this division to be made at least annually by a certified public accountant.
Do any and all things necessary to carry out the purposes of this division.
The authority shall publish, pursuant to Section 6061 of the Government Code, notice of the time and place of the public hearing for the adoption of the annual budget not later than 15 days prior to the hearing.
The proposed annual budget shall be available for public inspection at least 15 days prior to the hearing.
CHAPTER 4. Powers and Functions [150150. - 150155.]
The authority may adopt a seal and alter it at its pleasure.
The authority may sue and be sued, except as otherwise provided by law, in all actions and proceedings, in all court tribunals of competent jurisdiction.
All claims for money or damages against the authority are governed by Division 3.6 (commencing with Section 810) of Title 1 of the Government Code except as provided therein, or by other statutes or regulations expressly applicable thereto.
The authority may make contracts and enter into stipulations of any nature whatsoever, including, but not limited to, contracts and stipulations to indemnify and hold harmless, to employ labor, and to do all acts necessary and convenient for the full exercise of the powers granted in this division.
The authority may contract with any department or agency of the United States of America, with any public agency, including, but not limited to, the Department of Transportation, the Tuolumne County LTC, or with any person upon any terms and conditions that the authority finds is in its best interest.
The authority may provide and maintain, by contract with a public agency or by other means, a security force to enforce its regulations, preserve and protect any project financed pursuant to this division, and preserve and protect the public peace, health, and safety with respect to its projects.
CHAPTER 5. Transactions and Use Tax [150200. - 150214.]
The Legislature, by the enactment of this chapter, intends the additional funds provided government agencies by this chapter to supplement existing local revenues being used for public transportation purposes. The government agencies are further encouraged to maintain their existing commitment of local funds for public transportation purposes.
A retail transactions and use tax ordinance shall be imposed by the authority in accordance with Section 150206 and Part 1.6 (commencing with Section 7251) of Division 2 of the Revenue and Taxation Code, if a majority of the electors voting on the measure vote to approve its imposition at special elections called for that purpose by the county and city, respectively. Those elections shall be consolidated. The ordinances shall take effect at the close of the polls on the day of election at which the measures are adopted, to impose the tax at the same rate.
The initial collection of the retail transactions and use tax shall take place in accordance with Section 150204.
If, at any time, the voters do not approve an ordinance imposing the retail transactions and use tax, the same or a different measure imposing that tax may, at any time thereafter, be submitted to the voters.
The retail transactions and use tax ordinance shall state the nature of the tax to be imposed, the tax rate or the maximum tax rate, the purposes for which the revenue derived from the tax will be used, and may set a term, not to exceed 15 years, during which the tax will be imposed. The purposes for which the tax revenues will be used may include, but are not limited to, the administration of this division, including legal actions related thereto, the construction, capital acquisition, maintenance, and operation of streets, roads, and highways, including state highways. These purposes include expenditures for the planning, environmental reviews, engineering and design costs, and related right-of-way acquisition. The ordinance shall reference an expenditure plan which shall include the allocation of revenues for the purposes authorized by this section.
The county shall conduct the elections called pursuant to Section 150201.
The elections shall be called and conducted in the same manner as provided by law for the conduct of elections by a county.
Any retail transactions and use tax ordinance adopted pursuant to this chapter shall be operative on the first day of the first calendar quarter commencing more than 120 days after adoption of the ordinance.
An increase in the tax rate, adopted by the electors’ approval of an ordinance pursuant to subdivision (b) of Section 150206, or a decrease in the tax rate adopted by the authority pursuant to Section 150207, shall be operative on the first day of the first calendar quarter commencing more than 120 days after approval by the electors or adoption by the authority, as the case may be.
Prior to the operative date of the ordinance, the authority shall contract with the State Board of Equalization to perform all functions incident to the administration and operation of the ordinance.
Revenues from the retail transactions and use tax imposed pursuant to this chapter shall be allocated by the authority for public transportation purposes consistent with the expenditure plan referenced in the ordinance imposing the tax. The authority, by a four-fifths vote of its members, may revise that expenditure plan after conducting noticed public hearings on the proposed revision.
The amounts allocated to projects within the county and the city, respectively, shall be proportionate to the revenues derived from the tax collected within each of the respective jurisdictions.
The authority, subject to the approval of the voters, may impose a maximum tax rate of 1 percent under this division and Part 1.6 (commencing with Section 7251) of Division 2 of the Revenue and Taxation Code, and the authority may state the maximum tax rate at 1 percent or one-half of 1 percent. The authority shall not levy the retail transactions and use tax at a rate other than 1 percent or one-half of 1 percent, unless specifically authorized by the Legislature.
The tax rate adopted pursuant to this chapter, unless otherwise prohibited, may be increased by the authority by ordinance adopted in the manner and by the vote stated in Sections 150201 and approved by a majority of the electors voting on the measure at an election called for that purpose.
The authority may reduce the tax rate to a percentage lower than that approved by the voters and may further provide for an increase of the tax rate if it has previously been lowered. However, the tax rate may not be increased to a rate above the tax rate approved by the voters.
Any revised tax rate may be adopted only if the authority determines, by a four-fifths vote of its members, that the proceeds of the taxes with the altered tax rate will be sufficient to provide for the payment of the principal of, and interest on, any limited tax bonds and any other indebtedness incurred by the authority which was to be payable from the proceeds of the retail transactions and use tax.
A ballot proposition to approve an ordinance for the imposition of a retail transactions and use tax, shall seek authorization to issue bonds payable from the proceeds of the tax and establish the appropriations limit of the authority.
The maximum bonded indebtedness which may be outstanding at any one time shall be an amount equal to the sum of the principal of, and interest on, the bonds, but not to exceed the estimated proceeds of the tax for a period of not more than the number of years for which the tax authorized by this chapter is to be imposed.
The bonds authorized by the voters concurrently with the approval of the retail transactions and use tax may be issued by the authority at any time, and from time to time, payable from the proceeds of the tax. The bonds shall be referred to as “limited tax bonds.” The bonds may be secured by a pledge of revenues from the proceeds of the tax.
The pledge of the tax to the limited tax bonds authorized under this chapter shall have priority over the use of any of the taxes for “pay-as-you-go” financing, except to the extent that the priority is expressly restricted in the resolution authorizing the issuance of the bonds.
The authority may provide for the bonds to bear a variable interest rate, for the manner and intervals in which the rate shall vary, and for the dates on which the interest shall be payable.
Limited tax bonds shall be issued pursuant to a resolution adopted at any time, and from time to time, by the authority by a four-fifths vote of all of its members.
The authority may, from time to time, issue bonds in accordance with the Revenue Bond Law of 1941 (Chapter 6 (commencing with Section 54300) of Part 1 of Division 2 of Title 5 of the Government Code), for the purposes set forth in the ordinance adopted pursuant to Section 150202, which shall constitute an “enterprise” within the meaning of Section 54309 of the Government Code. Article 3 (commencing with Section 54380) of Chapter 6 of Part 1 of Division 2 of Title 5 of the Government Code and the limitations on the rate of interest set forth in subdivision (b) of Section 54402 of the Government Code do not apply to the issuance of the sale of bonds pursuant to this division. Instead, the authority shall authorize the issuance of bonds by resolution, which shall specify all of the following:
The purposes for which the bonds are to be issued.
The maximum principal amount of the bonds.
The maximum term for the bonds.
The maximum rate of interest to be payable upon the bonds shall not exceed the maximum rate permitted by Section 53531 of the Government Code or any other applicable provisions of law. In the case of bonds bearing a variable interest rate, the variable rate shall on no day exceed the maximum rate permitted on that day by Section 53531 of the Government Code or any other applicable provisions of law.
The maximum discount on the sale of the bonds. However, the bonds shall not be sold at less than 95 percent of the principal amount in the manner determined by the authority. Each resolution shall provide for the issuance of bonds in the amounts as may be necessary, until the full amount of the bonds authorized has been issued. The full amount of bonds may be divided into two or more series with different dates of payment fixed for the bonds of each series. A bond need not mature on its anniversary date.
Any bonds issued pursuant to this chapter are a legal investment for all trust funds; for the funds of insurance companies, commercial and savings banks, and trust companies; and for state school funds. Whenever any money or funds may, by any law now or hereafter enacted, be invested in bonds of cities, counties, school districts, or other districts within this state, that money or funds may be invested in the bonds issued under this chapter, and whenever bonds of cities, counties, school districts, or other districts within this state may, by any law now or hereafter enacted, be used as security for the performance of any act or the deposit of any public money, the bonds issued pursuant to this chapter may be so used. The provisions of this chapter are in addition to all other laws relating to legal investment and shall be controlling as the latest expression of the Legislature with respect thereto.
Any action or proceeding wherein the validity of the adoption of the retail transactions and use tax ordinance provided for in this chapter or the issuance of any bonds thereunder or any of the proceedings in relation thereto is contested, questioned, or denied, shall be commenced within six months from the date of the election at which the ordinance is approved; otherwise, the bonds and all proceedings in relation thereto, including the adoption and approval of the ordinance, shall be held to be valid and in every respect legal and incontestable.
The commission may not impose any tax other than the retail transactions and use tax imposed upon approval of the voters in accordance with this division.
DIVISION 16. PENINSULA RAIL TRANSIT DISTRICT [160000. - 160006.]
CHAPTER 1. General Provisions and Definitions [160000. - 160002.]
The Peninsula Corridor Study Joint Powers Board, created pursuant to Section 1 of Chapter 1328 of the Statutes of 1987, is hereby redesignated the Peninsula Rail Transit District and, as such, has the additional powers provided for in Chapter 2 (commencing with Section 160005).
As used in this division, “district” means the Peninsula Rail Transit District.
The district board shall be comprised of nine members appointed as follows:
The governing bodies of the municipal railway operated by the City and County of San Francisco, the San Mateo County Transit District, and the Santa Clara County Transit District shall each appoint one member.
The Boards of Supervisors of the City and County of San Francisco, the County of San Mateo, and the County of Santa Clara shall each appoint one member.
The Mayor of the City and County of San Francisco shall appoint one member.
The city councils of cities within the County of San Mateo, shall jointly appoint one member.
The city councils of cities within the County of Santa Clara shall jointly appoint one member.
CHAPTER 2. Powers of the District [160005. - 160006.]
In addition to powers delegated to the Peninsula Corridor Study Joint Powers Board by a joint exercise of powers agreement pursuant to Section 1 of Chapter 1328 of the Statutes of 1987, the district has all of the following powers:
To acquire real and personal property of every kind for rail purposes by grant, gift, devise, lease, or eminent domain, and to hold, use, sell, lease, or transfer any such property.
To enter into any contract necessary for its powers.
To establish or change rates, charges, and services. The Public Utilities Commission has no jurisdiction over the district or any of its activities except as to matters of public safety.
To indemnify and defend any railroad corporation, regardless of its negligence, that operates rail services for the district pursuant to contract.
To appoint an executive officer, and to employ staff and legal counsel.
To sue and be sued.
To indemnify and defend the Department of Transportation with respect to the transfer of rights-of-way, stations, rail passenger equipment, and facilities, and contracts, leases, or agreements relative to those properties whose ownership or responsibility is transferred to the district in accordance with the terms of an agreement to be negotiated.
If the district acquires stations, facilities, and passenger equipment owned or leased by the Department of Transportation for the passenger rail service provided by the Southern Pacific Transportation Company between San Francisco and San Jose and points in between, and if the district acquires from the Department of Transportation the right-of-way between San Francisco and San Jose presently owned by the Southern Pacific Transportation Company, the district may own, operate, construct, manage, and maintain rights-of-way, stations, facilities, and equipment necessary for the operation of rail passenger and freight services between San Francisco and Alma and points in between, and may contract with any railroad corporation for the purchase of, or to subsidize, service between San Francisco and Alma and points in between. Upon completion of the conditions specified in subdivision (a) of Section 14035.4 of the Government Code, the district may provide commuter rail service between San Jose and Gilroy.
Any assets transferred from the Department of Transportation to the district without compensation shall be transferred with all attendant obligations, liabilities, debts, and grant conditions established by the department, including Urban Mass Transportation Administration grants and sale and leaseback contracts.
DIVISION 16.5. STATE TRANSPORTATION CORRIDOR PRESERVATION [161000. - 161031.]
CHAPTER 1. General Provisions and Definitions [161000. - 161004.]
The Legislature finds and declares as follows:
Transportation is vital to the state’s economy, and a complete transportation system is essential in times of disaster.
Transportation corridors should be protected from uses which are incompatible with transportation requirements.
Important potential transportation corridors are being developed for other purposes.
It is, therefore, the intent of the Legislature in enacting this division to vest in the Department of Transportation responsibility for implementing a program of transportation right-of-way protection and conservation within essential transportation corridors by acquiring and holding transportation corridor lands which would otherwise be lost to public use.
It is the further intent of the Legislature in enacting this division to preserve land which is needed or will be needed for transportation corridors consistent with applicable environmental protection laws and regulations.
As used in this division, “commission” means the California Transportation Commission.
As used in this division, “department” means the Department of Transportation.
As used in this division, “secretary” means the Secretary of Transportation.
As used in this division, “transportation corridor” means an area or one or more parcels of land that meets any of the following requirements:
Designated by the commission as necessary under the adopted state transportation improvement plan.
Designated by a transportation planning agency, county transportation commission, or the San Diego County Metropolitan Transit Development Board as necessary under the adopted regional transportation implementation plan.
Within the adopted route of a state highway.
Within the adopted route of a county or city highway or exclusive mass transit guideway which is consistent with the county or city general plan.
Designated by the commission as being within one of two or more proposed routes or alignments for a state highway.
CHAPTER 2. Duties and Functions [161020. - 161031.]
The department may apply for and accept federal grants and receive gifts, donations, subventions, rents, royalties, and other financial support from public and private sources for purposes of this division.
The department may serve as a repository for lands located within a transportation corridor where the preservation of those lands is required by the department or an agency of local government to meet its transportation policies and objectives, and may accept a dedication of fee title, easements, development rights, or other interest in lands for this purpose.
On an annual basis, or as may be otherwise required by the secretary, the department shall report to the secretary regarding privately owned lands determined to have special significance for purposes of preserving a transportation corridor and which might be the subject of an exchange for other state lands. Specific privately owned land shall be included in the report only with the consent of the owner.
The department may acquire land or any interest therein for purposes of this division pursuant to procedures applicable to the acquisition of land by the department or the commission. If other means of acquisition have not been successful, the department may exercise the power of eminent domain for these purposes. The power of eminent domain may only be exercised to acquire land which is necessary for construction of the relevant highway route or guideway alignment, and shall not include land for rest stops or other ancillary uses.
The department may sell, rent, lease, exchange, or otherwise transfer any land or interest therein acquired under this division pursuant to an implementation plan adopted by the department. Any lease entered into under this division shall be for not more than 20 years.
Except as otherwise provided by law or by agreement, the proceeds of the sale, rental, lease, exchange, or transfer of land or interest therein, including any rent or other income from land held by the department, shall be deposited in the State Highway Account in the State Transportation Fund.
The department shall develop and implement procedures to ensure that land acquisition, leasing, options to purchase, disposal, and other transactions in land under this division are carried out efficiently and equitably and with proper notice to the public.
The department shall cooperate with federal, state, and local public agencies in ensuring the reservation of lands for transportation purposes.
If any state or local public agency is unable, due to limited financial resources or other circumstances of a temporary nature, to acquire land for transportation purposes, the department may acquire and hold that land for subsequent conveyance to the public agency. The department may provide technical assistance to aid public agencies in completing those acquisitions and related functions.
The department shall not hold any land acquired under this division for more than 20 years from the time of acquisition. A state or local public agency may acquire the land at any time during this period for transportation purposes. The acquisition price to a state or local public agency shall be based upon the cost of acquisition under this division plus administrative and management costs in preserving the land. The payment of this acquisition price shall be either monetary or in department-approved land of an equivalent value, or a combination thereof. No land acquired under this section shall be disposed of under Section 11011.1 of the Government Code.
If, at the expiration of a 20-year period, no public agency is willing or able to acquire the land, the department shall dispose of the land at fair market value without restriction on its subsequent use under this division. All proceeds of a disposition under this subdivision shall be deposited in the State Highway Account in the State Transportation Fund.
If the department acquires any land prior to the adoption of a specific route or alignment by the commission, the commission shall disregard that land in the study and adoption of routes and alignments.
There is hereby appropriated from the State Highway Account in the State Transportation Fund to the department the amount of the proceeds of all sales, except the proceeds of sales pursuant to Section 14528.8 of the Government Code, leases, and rentals, on and after January 1, 1991, of land acquired by the department for transportation purposes, until a total of twenty-five million dollars ($25,000,000) has been so appropriated, to be expended by the department for the purposes of this division.
The department shall comply with applicable environmental protection laws and regulations when taking any action authorized by this division.
DIVISION 17. SAN DIEGO COUNTY REGIONAL AIRPORT AUTHORITY [170000. - 170084.]
CHAPTER 1. General Provisions [170000. - 170006.]
This division shall be known and may be cited as the San Diego County Regional Airport Authority Act.
There is hereby established the San Diego County Regional Airport Authority, as a local governmental entity of regional government, with jurisdiction extending throughout the County of San Diego.
The Legislature finds and declares all of the following:
Airports help to link local, regional, statewide, national, and global economic activities. Airports are also essential features of comprehensive transportation systems, that include streets and highways, rail transit, transit over water, and mass transit.
It is essential to the public health, safety, and welfare that airports be developed and operated in the San Diego County region so that those airports promote economic development, protect environmental quality, and enhance social equity.
The significant regional consequences of airport planning, development, and operations require the creation of a regional airport authority.
For the purposes of this division, the following terms have the following meanings, unless the context requires otherwise.
The “authority” means the San Diego County Regional Airport Authority established under this division.
The “board” and “board of directors” means the governing board of the authority established as specified in Chapter 2 (commencing with Section 170010).
The “consolidated agency” means the authority resulting from the consolidation of the San Diego Association of Governments and the transit boards pursuant to Chapter 3 (commencing with Section 132350) of Division 12.7.
The “east county cities” means the Cities of El Cajon, La Mesa, Lemon Grove, and Santee.
The “north county coastal cities” means the Cities of Carlsbad, Del Mar, Encinitas, Oceanside, and Solana Beach.
The “north county inland cities” means the Cities of Escondido, Poway, San Marcos, and Vista.
The “port” means the San Diego Unified Port District established under the San Diego Unified Port District Act (Chapter 67 of the Statutes of 1962, First Extraordinary Session).
The “San Diego International Airport” means the airport located at Lindbergh Field in the County of San Diego.
The “south county cities” means the Cities of Chula Vista, Coronado, Imperial Beach, and National City.
CHAPTER 2. Governing Body [170010. - 170026.]
The board of directors shall consist of nine voting members, appointed as follows:
The Mayor of the City of San Diego shall appoint three persons, two of whom shall be subject to confirmation by the City Council of the City of San Diego. The persons appointed pursuant to this paragraph shall be residents of the City of San Diego and not less than one shall be an elected official of the City of San Diego. For purposes of this subdivision, an “elected official of the City of San Diego” means the Mayor or a member of the City Council of the City of San Diego.
The Chair of the Board of Supervisors of the County of San Diego shall appoint two persons, subject to confirmation by the Board of Supervisors of the County of San Diego. The persons appointed pursuant to this paragraph shall be residents of the County of San Diego and not less than one shall be a member of the Board of Supervisors of the County of San Diego.
At a public meeting, the mayors of the east county cities shall appoint one person pursuant to a majority vote of the mayors of the east county cities. The person appointed pursuant to this paragraph shall be a member of a city council of one of the east county cities or another resident of one of the east county cities.
At a public meeting, the mayors of the north county coastal cities shall appoint one person pursuant to a majority vote of the mayors of the north county coastal cities. The person appointed pursuant to this paragraph shall be a member of a city council of one of the north county coastal cities or another resident of one of the north county coastal cities.
At a public meeting, the mayors of the north county inland cities shall appoint one person pursuant to a majority vote of the mayors of the north county inland cities. The person appointed pursuant to this paragraph shall be a member of a city council of one of the north county inland cities or another resident of one of the north county inland cities.
At a public meeting, the mayors of the south county cities shall appoint one person pursuant to a majority vote of the mayors of the south county cities. The person appointed pursuant to this paragraph shall be a member of a city council of one of the south county cities or another resident of one of the south county cities.
Public meetings convened pursuant to subparagraphs (C) to (F), inclusive, of paragraph (1) shall be publicly noticed by the authority and by each of the cities whose mayor is eligible to participate in the meeting. These meetings are subject to the Ralph M. Brown Act (Chapter 9 (commencing with Section 54950) of Part 1 of Division 2 of Title 5 of the Government Code) and shall be conducted by the authority clerk who shall record the minutes of the meeting.
The authority may issue guidance to cities concerning the appointment process.
The following persons shall be nonvoting, noncompensated, ex officio members of the board of directors, appointed by the Governor:
The District Director of the Department of Transportation for the San Diego region.
The Department of Finance representative on the State Lands Commission.
The board of directors may provide for additional nonvoting, noncompensated members of the board of directors, including representatives of the United States Navy and the United States Marine Corps, each of whom may appoint an alternate to serve in his or her place.
The Mayor of the City of San Diego shall appoint the chair of the authority board of directors from among the nine voting members of the board of directors.
Except as provided in subdivision (b) of Section 170010 , the term of office of a member of the board of directors appointed pursuant to subdivision (a) of Section 170010 is three years. A member of the board of directors may continue to serve beyond the expiration of the term until his or her successor qualifies for appointment and takes office. Following appointment, a member of the board of directors shall take office at 12:01 a.m. on February 1 of the year in which the appointment commences. If a board appointment is made after February 1 of the year in which the member’s term is scheduled to commence, the member shall take office immediately upon appointment and, if applicable, after receiving confirmation, to serve the remainder of the term.
If a member of the board of directors is appointed to be a member as a result of holding another public office and that person no longer holds that other public office, then that person shall no longer serve on the board of directors and a vacancy shall exist.
Any vacancy in the office of a member of the board of directors shall be filled promptly pursuant to Section 1779 of the Government Code.
Any person appointed to fill a vacant office shall serve the balance of the unexpired term. If a member of the board of directors leaves office prior to the expiration of his or her term, the vacancy shall be filled for the balance of the unexpired term pursuant to subdivision (a) of Section 170010.
At the first meeting of the board of directors on or after February 1 of each even-numbered year, the board of directors shall meet and elect its officers, except for the chair of the board of directors, who shall be appointed by the Mayor of the City of San Diego.
The officers of the board of directors are a chair, vice chair, and those additional officers created by the board of directors pursuant to subdivision (c). The chair shall preside over meetings of the board of directors and the vice chair shall serve during the chair’s absence or inability to serve.
The board of directors may create additional offices and elect members to those offices, provided that no member of the board of directors shall hold more than one office.
The board of directors shall govern the authority.
The board of directors shall establish policies for the operation of the authority. The board of directors shall provide for the implementation of those policies which are the responsibility of the authority’s chief executive officer.
All members of the board of directors shall exercise their independent judgment on behalf of the interests of the residents, property owners, and the public within San Diego County as a whole in furthering the purposes and intent of this division. The members of the board of directors shall represent the interests of the public as a whole and not solely the interests of the local officials who appointed them to the board of directors.
The board of directors shall have a three-member executive committee. One member of the executive committee shall be a board member selected from among those members appointed by the Mayor of the City of San Diego pursuant to subparagraph (A) of paragraph (1) of subdivision (a) of Section 170010 (category 1). One member of the executive committee shall be a board member appointed by the Chair of the Board of Supervisors of the County of San Diego pursuant to subparagraph (B) of paragraph (1) of subdivision (a) of Section 170010 (category 2). One member of the executive committee shall be a board member selected from among those members appointed pursuant to subparagraphs (C) to (F), inclusive, of paragraph (1) of subdivision (a) of Section 170010 (category 3). Additionally, members of the executive committee shall be the following:
The chair of the authority’s board of directors pursuant to subdivision (d) of Section 170010.
The vice chair of the authority’s board of directors, appointed from a category different than the chair.
A third member of the board of directors appointed from a category that is not represented on the executive committee as a result of paragraphs (1) and (2).
The members of the executive committee serving pursuant to paragraphs (2) and (3) shall each be selected to serve by a vote of the members of the board of directors.
The board of directors shall appoint a seven-member audit committee consisting of four members of the board of directors and the three public members appointed pursuant to Section 170018.
Meetings of the board of directors are subject to the provisions of the Ralph M. Brown Act (Chapter 9 (commencing with Section 54950) of Part 1 of Division 2 of Title 5 of the Government Code).
A majority of the total voting membership of the board of directors shall constitute a quorum for the transaction of business.
The board of directors shall act only by ordinance, resolution, or motion.
Except as provided in subdivision (e), to adopt an ordinance, resolution, or motion requires both a numerical and a weighted majority vote of the total voting membership of the board of directors pursuant to paragraphs (2) and (3).
A numerical majority requires an affirmative vote of at least five of the voting membership of the board of directors.
A weighted majority requires an affirmative vote of at least 51 vote points that are allocated to the voting membership of the board of directors, unless the total number of vote points is expanded beyond 100 as a result of the operation of subparagraph (E). If the total number of vote points is greater than 100 as a result of the operation of subparagraph (E), a weighted majority requires an affirmative vote of at least 50 percent plus one of the total vote points. Vote points shall be allocated pursuant to subparagraph (B).
There shall be a total of 100 allocated vote points for the weighted vote, except that additional vote points shall be allocated pursuant to subparagraph (E). For purposes of this paragraph, the City of San Diego, the County of San Diego, the east county cities, the north county coastal cities, the north county inland cities, and the south county cities are each a jurisdiction. The points allocated to the City of San Diego shall be divided among the three board members appointed pursuant to paragraph (1) of subdivision (a) of Section 170010. The points shall be allocated among the three board members by the Mayor of the City of San Diego, keeping the votes for each seat as close to equal as possible but in a manner that avoids fractional vote points. The vote points allocated to the County of San Diego shall be divided between the two board members appointed pursuant to paragraph (2) of subdivision (a) of Section 170010. The vote points shall be allocated among the two board members by the chair of the board of supervisors, keeping the votes for each seat as close to equal as possible but in a manner that avoids fractional vote points. Each jurisdiction shall have that number of vote points determined by the following allocation formula, except that each jurisdiction shall have at least one vote point, no jurisdiction shall have more than 40 vote points, and there shall be no fractional vote points:
If any jurisdiction has 40 percent or more of the total population of the San Diego County region, 40 vote points shall be allocated to that jurisdiction and the remaining vote points shall be allocated to the remaining jurisdictions pursuant to clause (ii). If no jurisdiction has 40 percent or more of the total population of the San Diego County region, vote points shall be allocated pursuant to clause (iii).
The total population of the remaining jurisdictions shall be computed and the remaining 60 vote points allocated based upon the percentage of the total that each jurisdiction has, in the following manner:
The percentage each jurisdiction bears to the total remaining population shall be multiplied by 60 to determine fractional shares.
(II) Each fraction less than one shall be rounded up to one, so that no jurisdiction has less than one vote point.
(III) Disregarding any fractional vote points and adding just the whole vote points, if the total vote points is 60, fractional vote points are dropped and the whole numbers are the vote points for each jurisdiction.
(IV) If, after disregarding the fractional vote points and adding just the whole vote points, the total vote points for the remaining jurisdictions is less than 60, the difference in vote points shall be allocated to jurisdictions in order of the highest fractions until a total of 60 vote points are allocated, excepting those jurisdictions whose vote was increased to one pursuant to subclause (II).
If, after disregarding the fractional vote points and adding just the whole vote points, the total vote points for the remaining jurisdictions is more than 60, the vote points in excess of 60 shall be eliminated by subtracting vote points from jurisdictions with the lowest percentage to the total remaining population except that no jurisdiction’s vote points shall be reduced to less than one.
If no jurisdiction has 40 percent or more of the total population of the San Diego County region, the total population of the region shall be computed and all 100 vote points shall be allocated based upon the percentage each jurisdiction bears to the total population of the region, in the following manner:
When a weighted vote is taken on any item that requires more than a majority vote of the board, it shall also require the same supermajority percentage of the weighted vote.
The allocation of vote points pursuant to this subdivision shall be made annually by the board of directors based upon the population calculations made by the San Diego Association of Governments (SANDAG).
Any other newly incorporated city shall be added to the jurisdiction designated by SANDAG. The board member representing that jurisdiction shall receive one additional vote under the weighted vote procedure specified above until the next allocation of vote points pursuant to subparagraph (D), at which time the new jurisdiction shall receive votes in accordance with the formula specified in this paragraph. Until this next vote points allocation, the total number of weighted vote points may exceed 100.
Any act to submit a ballot measure to the voters at a regular or special election shall require a two-thirds majority vote, both numerically and by weighted vote, of the total voting membership of the board of directors.
The board of directors shall keep a record of all of its actions, including financial transactions.
The board of directors shall adopt rules or bylaws for its proceedings.
The board of directors shall adopt policies for the operation of the authority, including, but not limited to, ethical standards and practices, administrative policies, fiscal policies, personnel policies, and purchasing policies.
The board of directors may adopt and enforce rules and regulations for the administration, maintenance, operation, and use of its facilities and services.
A rule, regulation, or ordinance of the authority may be enforced in an administrative action. A civil penalty may be imposed if the administrative action results in a finding that a violation has taken place.
The authority may employ necessary personnel to enforce this section.
The board of directors may provide, by ordinance or resolution, that each of its members may receive compensation in an amount not to exceed two hundred dollars ($200) for each day of service. A member of the board of directors shall not receive compensation for more than eight days of service a month. A member of the board of directors shall not receive compensation for being present at more than one meeting, hearing, event, or training program on each day of service. A board member shall be present for at least half of the time set for the meeting, or for the duration of the meeting, whichever is less, in order to be eligible for compensation.
By a two-thirds vote of the majority, the board of directors may, by ordinance or resolution, modify the amount of compensation provided pursuant to subdivision (a).
The board of directors, by ordinance or resolution, may provide for the chair to receive an amount, not to exceed five hundred dollars ($500) a month, in addition to all other compensation provided pursuant to this section.
The board of directors may provide, by ordinance or resolution, that its members may receive their actual and necessary traveling and incidental expenses incurred while on official business. Reimbursement of these expenses is subject to Article 2.3 (commencing with Section 53232) of Chapter 2 of Part 1 of Division 2 of Title 5 of the Government Code, except that the provisions of this section shall prevail over the provisions of Section 53232.1 of the Government Code to the extent of any conflict.
The members of the board of directors shall not receive, in compensation, any benefits permitted to be paid to members of legislative bodies pursuant to Chapter 2 (commencing with Section 53200) of Part 1 of Division 2 of Title 5 of the Government Code. This subdivision does not prohibit a member of the board of directors from electing to participate in a plan of health and welfare benefits if the costs of those benefits are paid by the board member and the authority incurs no expense other than those expenses associated with processing the application of the board member seeking the benefits.
A member of the board of directors may waive any or all of the payments permitted by this section.
For the purposes of this section, a “day of service” means any of the following:
A meeting of the authority conducted pursuant to the Ralph M. Brown Act (Chapter 9 (commencing with Section 54950) of Part 1 of Division 2 of Title 5 of the Government Code).
Representation of the authority at a public event, if the board of directors has previously approved the member’s representation at a board of directors’ meeting and the member delivers a written report to the board of directors regarding the member’s representation at the next board of directors’ meeting following the public event.
Representation of the authority at a public meeting or a public hearing conducted by another public agency, if the board of directors has previously approved the member’s representation at a board of directors’ meeting and the member delivers a written report to the board of directors regarding the member’s representation at the next board of directors’ meeting following the public meeting or public hearing.
Representation of the authority at a meeting of a public benefit nonprofit corporation on whose board the authority has membership, if the board of directors has previously approved the member’s representation at a board of directors’ meeting and the member delivers a written report to the board of directors regarding the member’s representation at the next board of directors’ meeting following the corporation’s meeting.
Participation in a training program on a topic that is directly related to the authority, if the board of directors has previously approved the member’s participation at a board of directors’ meeting, and the member delivers a written report to the board of directors regarding the member’s participation at the next board of directors’ meeting following the training program.
Representation of the authority at an official meeting, if the board of directors has previously approved the member’s representation at a meeting of the board of directors and the member delivers a written report to the board of directors regarding the member’s representation at the next meeting of the board of directors following the official meeting.
The audit committee formed pursuant to subdivision (e) of Section 170013 shall be a standing committee of the board of directors. Each member of the committee shall be a voting member. The public members shall be appointed by the board of directors for staggered three-year terms.
The board of directors shall select the three public members from among the following categories of persons, with no more than one appointee from each category at any one time:
A professional with experience in the field of public finance and budgeting.
An architect or civil engineer licensed to practice in this state.
A professional with experience in the field of real estate or land economics.
A person with experience in managing construction of large-scale public works projects.
A person with public or private sector executive level decisionmaking experience.
A person who resides within the airport influence area of the San Diego International Airport (Lindbergh Field).
A person with experience in environmental justice as it pertains to land use.
The board of directors may appoint other persons to serve as nonvoting, noncompensated, ex officio members on the Audit Committee.
In appointing the public members of the Audit Committee, the board of directors shall provide for selection policies, appointment procedures, conflict-of-interest policies, length-of-term policies, and policies for providing compensation, if any.
The Audit Committee shall serve as a guardian of the public trust, acting independently and charged with oversight responsibilities for reviewing the authority’s internal controls, financial reporting obligations, operating efficiencies, ethical behavior, and regular attention to cashflows, capital expenditures, regulatory compliance, and operations.
The Audit Committee shall meet a minimum of four times per year and shall, at a minimum, do all the following:
Regularly review the authority’s accounting, audit, and performance monitoring processes.
At the time of contract renewal, recommend to the appropriate committee and the board of directors its nomination for an external auditor and the compensation of that auditor, and consider at least every three years, whether there should be a rotation of the audit firm or the lead audit partner to ensure continuing auditor independence.
Advise the appropriate committee and the board of directors regarding the selection of the auditor.
Be responsible for oversight and monitoring of internal and external audit functions, and monitoring performance of, and internal compliance with, authority policies and procedures.
Be responsible for overseeing the annual audit by the external auditors and any internal audits.
Make recommendations to the full board regarding paragraphs (1) to (5), inclusive.
An affirmative vote by at least five members of the Audit Committee shall be required for approval of the annual internal and external audits, including performance monitoring, the auditor’s annual audit plan for each fiscal year submitted to the board for approval, and actions recommending or approving debt financing for the authority.
Upon request of the board of directors of the authority, and with the consent of any labor organization acting as the exclusive representative of employees of the authority whose rights are governed by a collective bargaining agreement, the board may enter into a contract to enroll those employees as members of the California Public Employees’ Retirement System (CalPERS) or another retirement system.
A contract to enroll employees in CalPERS shall be subject to the provisions of Part 3 (commencing with Section 20000) of Division 5 of Title 2 of the Government Code and, where permitted by the law governing that system, shall receive full reciprocity with public employees’ retirement systems in which they previously participated.
Employees transferred from any existing retirement system or pension plan to CalPERS or any other retirement system by operation of this section shall receive benefits immediately after enrollment in, or transfer to, the system that are equal to the benefits the employees would have been entitled to immediately before enrollment in, or transfer to, the system.
The board of directors shall appoint the following executive employees of the authority:
Chief executive officer.
General counsel.
Auditor.
The chief executive officer shall be responsible for all of the following:
The implementation of the policies established by the board of directors for the operation of the authority.
The appointment, supervision, discipline, and dismissal of the authority’s other employees, including the deputy chief executive officer, consistent with the employee relations system established by the board of directors.
The supervision of the authority’s facilities and services.
The supervision of the authority’s finances.
CHAPTER 3. Powers and Duties [170030. - 170084.]
The authority has perpetual succession and may adopt a seal and alter it at its pleasure.
The authority may sue and be sued in all actions and proceedings, in all courts and tribunals of competent jurisdiction.
All the provisions of Section 120242 are applicable to the authority, and the authority may exercise those provisions within its area of jurisdiction.
The authority is a local agency for purposes of the California Disaster Assistance Act (Chapter 7.5 (commencing with Section 8680) of Division 1 of Title 1 of the Government Code).
The authority may act as a city police department, city, local government, or public agency for the purposes of Chapter 4 (commencing with Section 2080) of Title 6 of Part 4 of Division 3 of the Civil Code.
The authority may take by grant, purchase, devise, or lease or otherwise acquire, hold, enjoy, lease, and dispose of, real and personal property within or outside its area of jurisdiction in order to further its purposes.
The authority may contract with any department or agency of the United States, with any state or local governmental agency, or with any person upon those terms and conditions that the authority finds are in its best interests.
Except as otherwise specifically provided to the contrary in this chapter, a recorded majority vote of the total membership of the board of directors is required on each action.
The authority has exclusive responsibility to study, plan, and implement any improvements, expansion, or enhancements at San Diego International Airport.
The authority may commission planning, engineering, economic, and other studies to provide information to the board for making decisions about the location, design, management, and other features of future airports.
The San Diego Association of Governments, or its successor, shall cooperate with the authority to include all airport system plans and facilities selected by the authority in the regional transportation plan consistent with state and federal law.
The authority, the San Diego Association of Governments, local agencies, and the Department of Transportation shall cooperate to develop effective surface transportation access to new and existing airports.
The authority may adopt a comprehensive plan on the future development of San Diego’s regional international airport.
The authority shall be the only agency, public or private, in the County of San Diego that is eligible to take ownership of airports owned by the United States government and are declared surplus or are otherwise made available to state or local governmental agencies.
The authority shall be responsible for developing all aspects of airport facilities that it operates, including, but not limited to, all of the following:
The location of terminals, hangars, aids to air navigation, Runway Protection Zones (RPZ), Airport Influence Areas (AIA), parking lots and structures, and all other facilities and services necessary to serve passengers and other customers of the airport.
Street and highway access and egress with the objective of minimizing, to the extent practicable, traffic congestion on access routes in the vicinity of the airport.
Providing for public mass transportation access in cooperation and coordination with the responsible public transportation agency in whose jurisdiction the airport is located.
Analyzing and developing intercity bus and passenger rail access to terminals in cooperation with an established agency or organization experienced in developing and operating that service, if the service or the technology proposed for implementation is demonstrated to be in regular, scheduled revenue service and is demonstrated to be a cost-effective investment when considering both direct and indirect benefits. If that service is proven feasible, the authority shall endeavor to maximize the convenience of its patrons by incorporating the service into the design of its terminals.
The authority shall form an advisory committee to assist it in performing its responsibilities related to the planning and development of all airport facilities for the County of San Diego, including the airport activities and operations of the United States Department of Defense. In selecting members for the committee, the authority shall include persons knowledgeable about airport management, passenger and freight air transportation operations and economics, general aviation, the natural environment, regional economic development, business, including the technology sector of the economy.
To the extent feasible, the advisory committee shall include representatives from the Department of Transportation, local public transit authorities, local governments, the campuses of the University of California and the California State University in the region, the United States Department of Defense, and other groups and residents of San Diego County.
When forming the advisory committee, the authority shall make its selections for membership from individuals representing all elements of the County of San Diego.
The port shall transfer all title and ownership of the San Diego International Airport to the authority consistent with the terms of the transfer under Section 170060 and shall include, but need not be limited to, all of the following:
All interest in real property and improvements, including, but not limited to, all terminals, runways, taxiways, aprons, hangars, Runway Protection Zones (RPZ), Airport Influence Areas (AIA), emergency vehicles or facilities, parking facilities for passengers and employees, above and below ground utility lines and connections, easements, rights-of-way, other rights for the use of property necessary or convenient to the use of airport properties, and buildings and facilities used to operate, maintain, and manage the airport which is consistent with the Airport Layout Plan (ALP) dated September 13, 2000, and identified as Drawing No. 724 on file with the clerk of the port, subject to paragraphs (1), (2), and (3).
The following real properties shall not be transferred and shall remain under the ownership and control of the port:
All property originally leased to General Dynamics Corporation and identified in Document No. 12301 on file with the clerk of the port.
Property subleased by the port from TDY Industries, Inc., c/o Allegheny Teledyne (formerly Teledyne Ryan Aeronautical) and identified as Document No. 17600 on file with the clerk of the port.
Property leased to Solar Turbines, Incorporated for parking along Pacific Highway and identified as Document No. 39904 on file with the clerk of the port (Parcel No. 016-026).
Property leased to Solar Turbines, Incorporated, for parking along Laurel Street and identified as Document No. 29239 on file with the clerk of the port (Parcel No. 016-016 - Parcel 2).
Property leased to Sky Chefs, Incorporated, located at 2450 Winship Lane and identified as Document No. 37740 on file with the clerk of the port (Parcel No. 012-025).
Property located at Parcel No. 034-002 and identified as Pond 20. The port shall retain ownership of Pond 20 and shall reimburse the airport fund for the fair market value of that property. The fair market value shall be determined by appraisal and negotiation. If there is no agreement following that negotiation, then the amount of payment shall be determined by arbitration.
On January 1, 2003, the port shall commence repayment to the airport of the negotiated or arbitrated fair market value for the property. The repayment schedule shall be a 10-year amortized payment plan with interest based upon the rate of 1 percent above the prevailing prime rate.
The following additional real properties shall be transferred from the port to the authority:
Property adjacent to Pond 20 located at Parcel Nos. 042-002 and 042-003 (this parcel encompasses approximately two or three acres).
Property acquired as Parcel No. 034-001 from Western Salt Processing Plant and identified as Document No. 39222 from GGTW, LLC.
The following nonairport, real properties that presently provide airport-related services shall also be excluded from any land transfer to the authority:
Airport employee parking lot located at Harbor Island Drive and Harbor Island Drive East identified as District Parcel No. 007-020.
Airport taxi and shuttle overflow lot located at the southeast corner of North Harbor Drive and Harbor Island Drive identified as District Parcel No. 007-025.
Property leased to National Car Rental System, Incorporated, located east of the southeast corner of North Harbor Drive and Harbor Island Drive identified as District Parcel No. 007-034.
Property leased to The Hertz Corporation located east of the southeast corner of North Harbor Drive and Harbor Island Drive identified as District Parcel No. 007-035.
Property leased to Avis Rent-A-Car Corporation located at the southwest corner of North Harbor Drive and Rental Car Roadway identified as District Parcel No. 007-036.
Property leased to National Car Rental System, Incorporated, located at the southeast corner of North Harbor Drive and Rental Car Roadway identified as District Parcel No. 007-038.
Property leased in common to National Car Rental System, Incorporated; The Hertz Corporation; and Avis Rent-A-Car Corporation known as Joint-Use Roadway identified as District Parcel No. 007-037.
Property leased to Jimsair, Incorporated, located on the property previously known as the General Dynamics Parcel, south of Sassafras Street and west of Pacific Highway adjacent to the Airport Operation Area identified as District Parcel No. 016-042.
Property leased to Budget Rent A Car of San Diego located at both the northeast and southwest corners of Palm Street and Pacific Highway identified as District Parcel No. 016-001 (Parcel 1 and 2).
Property leased to Budget Rent A Car of San Diego located east of the northeast corner of Palm Street and Pacific Highway identified as District Parcel No. 016-001 (Parcel 3).
Property leased to Lichtenberger Equipment, Incorporated, located north of the northeast corner of Palm Street and Pacific Highway identified as District Parcel No. 016-034.
Property leased to Park and Ride, Incorporated, located at the northeast corner of Sassafras and Pacific Highway identified as District Parcel No. 016-038.
Property leased to Ace Parking Management, Incorporated, located north of the intersection of Sassafras Street and Pacific Highway identified as District Parcel No. 016-040.
Property leased to Federal Express Corporation located at the west end of the extension of Washington Street identified as District Parcel No. 015-008.
All contracts with airport tenants, concessionaires, leaseholders, and others, including, but not limited to, fees from vehicle rental companies.
All airport-related financial obligations secured by revenues and fees generated from the operations of the airport, including, but not limited to, bonded indebtedness associated with the airport. The authority shall assume obligations issued or incurred by the port for San Diego International Airport, including, but not limited to, any long-term debt, grants, and grant assurances.
All airport-related financial reserves, including, but not limited to, sinking funds and other credits.
All personal property, including, but not limited to, emergency vehicles, office equipment, computers, records and files, software required for financial management, personnel management, and accounting and inventory systems, and any other personal property owned by the port used to operate or maintain the airport.
Notwithstanding any provision of this section, the port shall agree to lease for a period of 66 years, commencing on January 1, 2003, to the authority parcels 1, 2, and 3 of the property originally leased to General Dynamics (identified in Document No. 12301 on file with the clerk of the port) consisting of approximately 89.75 acres west of the Pacific Highway and including property leased to JimsAir (identified as Parcel #016-042), property leased to Federal Express Corporation (identified as Parcel #015-008) and the Park, Shuttle and Fly lot operated by Five Star Parking under a management agreement with the port (identified as Clerk Document No. 38334, dated March 29, 1999), subject to the following terms:
The rent shall be paid monthly in arrears and the annual rent shall be level based on the fair market value of the property as of January 1, 2006, and a market rate of return on that date.
The authority shall lease to the port at the same fair market value per square foot a total of not to exceed 250 parking spaces in reasonable proximity to the port’s administrative building located at 3165 Pacific Highway with the authority having a right to relocate or substitute substantially equivalent or better parking from time to time. The parties shall first meet and confer to determine by appraisal and negotiation the fair market value rent. If the authority and port do not reach agreement within 60 days after commencement of meetings for that purpose, either party may submit the matter to binding arbitration in San Diego in accordance with the Commercial Arbitration Rules of the American Arbitration Association. In the event airport operations cease to exist on the property leased to the authority pursuant to this section, control of the property will revert to the port as provided in Section 170060.
All other terms of the ground lease shall be in accordance with reasonable commercial practice in the San Diego area for long-term real property ground leases.
Property adjacent to the San Diego International Airport, owned by the port, and commonly referred to as the “General Dynamics Property” shall continue to be operated by the port.
The port shall retain trusteeship of lands underlying the airport consistent with the State Lands Commission’s requirement and shall execute a 66-year lease with the authority for control of the airport property. The authority shall pay one dollar ($1) per year during the term of the lease, or until that time as airport operations controlled by the authority cease to exist on the property. At that time, the lease shall terminate and control of the property shall revert to the port.
The port may continue or enter into contracts, memorandums of understanding, or other agreements necessary to fulfill its responsibilities as trustee of the lands underlying the airport or adjacent lands under its control, or acquire additional lands within its jurisdiction consistent with its duties and pursuant to Division 6 (commencing with Section 6001) of the Public Resources Code.
The port shall act as lead agency to certify any studies, reports, or other documents necessary to fulfill its obligations as trustee of the lands described in paragraph (1).
Notwithstanding subparagraph (A) or any other provision of law, until the date that the port transfers the airport to the authority, the port and the authority, without the necessity of the giving of any notice, filing of any documents, or the taking of any other action, shall serve jointly as the lead agencies for the purposes of the California Environmental Quality Act (Division 13 (commencing with Section 21000) of the Public Resources Code) and regulations adopted thereto, including, but not limited to, the filing of notices of exemption, initial studies, negative declarations, and environmental impact reports. On and after the transfer date, the authority, without the necessity of the giving of any notice, filing of any documents, or the taking of any other action, is the sole lead agency for any documents for which an initial study has been commenced pursuant to Section 15063 of Title 14 of the California Code of Regulations or for which a notice of preparation has been issued pursuant to Section 15082 of Title 14 of the California Code of Regulations, regardless of whether or not a notice of determination has been issued or a notice of completion has been issued.
The lead agency status described in this paragraph is declaratory of existing law, and shall not in any respect be grounds for any claim or finding of noncompliance by the port or the authority, or both, with the California Environmental Quality Act (Division 13 (commencing with Section 21000) of the Public Resources Code) or regulations adopted under that act.
Lands acquired by or added to lands under its trusteeship by the port adjacent to the existing airport property and necessary to operate the airport, including, but not limited to, lands from the United States Marine Corp Recruit Depot for additional taxiways and other airport related facilities, shall be included in the lease to the authority as it is acquired by the port.
The authority shall be responsible for making any necessary application to the California Coastal Commission pursuant to the California Coastal Act of 1976 (Division 20 (commencing with Section 30000) of the Public Resources Code) and to other agencies in accordance with other applicable laws in effect on the effective date of the act that added this section for improvements upon coastal lands under the control of the authority through a lease. The port shall assist in the application for those projects as the trustee of the lands and shall not impede any improvements sought in the fulfillment of the authority’s duties. The authority shall be responsible for all applications, requests, or submittals to other governmental agencies for approvals, permits, authorizations or agreements of any kind affecting or relating to the property governed by the lease, and the port shall cooperate in completion of all documents in the form submitted or approved by the authority without modification, providing the documents are requested by the authority, or required by any other governmental agencies, or both.
The authority may, in its sole discretion, from time to time, enter into agreements with the port for services including, but not limited to, operations, maintenance, and purchasing, as the authority may find necessary or beneficial to facilitate the operation of San Diego International Airport.
The authority shall have no obligation to purchase or procure any services, facilities, or equipment from or through the port. At no time shall the authority be obligated to purchase auditing, public affairs, and governmental relations, strategic planning, legal, or board support services from the port. However, the authority may elect to obtain these services and support in agreement with the port.
Performance of all these services shall be subject to the direction and control of the authority, and shall be provided in accordance with specifications, policies, and procedures as communicated by the authority to the port from time to time. In all cases, the port shall provide services of sufficient quality, quantity, reliability, and timeliness to ensure that the authority can continue the operation, maintenance, planning and improvement of and for San Diego International Airport consistent with the standards and practices under which the airport is operated on the effective date of the act that added this subparagraph or higher standards as the authority may adopt, or as may be required in the authority’s judgment to meet the requirements of federal or state law, or the needs of the users of the airport for the safe, secure, and efficient operation of the airport. The authority also, from time to time, may establish performance standards for and may conduct financial or performance audits, or both, of all services provided by the port and all charges or claims for payment for the services provided.
Services provided by the Harbor Police shall in no event be of less quality than the standard established for airport police services by the three other largest airports, based on annual passengers, in this state. The port shall cooperate fully, at its own cost, in any financial or performance audit, or both, conducted by, or on behalf of, the authority or by any government agency having jurisdiction.
The authority shall reimburse the port for the actual and reasonable direct costs, including, but not limited to, an appropriate allocation of general and administrative expenses associated with the provision of that service, incurred by the port to deliver services actually provided to the authority in accordance with the standards and requirements described in this section. The port shall request payment for services on a monthly basis. Those requests shall provide details regarding each service or element thereof for which payment is requested as the authority reasonably may request. The authority shall have the right to review and approve any request for payment for those services. Payment shall be due and payable 30 days after the request provided all necessary supporting documentation is received by the authority.
The San Diego Harbor Police Department shall remain under the jurisdiction of the San Diego Unified Port District, and employees shall incur no loss of employment or reduction in wages, health and welfare benefits, seniority, retirement benefits or contributions made to retirement plans, or other terms and conditions of employment as a result of enactment of this division. The San Diego Harbor Police Department shall have the exclusive contract for law enforcement services at San Diego International Airport during that time as the airport continues to operate at Lindbergh Field, and peace officers of the Harbor Police shall remain employees of the port.
From revenues in accounts attributable to airport operations, the port shall fund the authority for not less than one million dollars ($1,000,000) each year until that time as the transfer of the airport and all associated revenue sources have been completed between the port and the authority. The authority’s board may submit a budget request for more than this amount if necessary to carry out its duties. The port shall approve those budget requests in a timely manner without modification or reduction. The authority shall report its total budget expenditure amount to the port on an annual basis and balance or carryover reserves from previous budgets. The funding provided by this subdivision replaces any loans made to the authority by the port under the former provisions set forth in this subdivision requiring the port to loan the authority the sum of one million dollars ($1,000,000).
Upon the completion of the transfer of San Diego International Airport to the authority, the authority shall assume all revenue stream revenues to fund its activities, operations, and investments consistent with its purposes. The sources of revenue available to the authority may include, but are not limited to, imposing fees, rents, or other charges for facilities, services, the repayment of bonded indebtedness, and other expenditures consistent with the purposes of the authority.
To the extent practicable, the authority shall endeavor to maximize the revenues generated from enterprises located on the property of the authority.
The authority may receive state and federal grants for purposes of planning, constructing, and operating an airport and for providing ground access to airports under its control.
No other agency in the County of San Diego may apply for grants for funding significant expansion activities, including, but not limited to, specific efforts to increase air capacity, unless the application is first approved by the authority as being consistent with the regional air transportation plan adopted by the authority.
Unless action is taken pursuant to Section 170068, publicly owned airports in the County of San Diego, other than the San Diego International Airport, shall not be considered to be under the control of the authority for purposes of application for, or receipt of grants for, regular operational maintenance and upgrade projects adopted pursuant to Section 21670.3.
The authority may only accept the transfer of ownership of other publicly owned airports in the County of San Diego upon initiation by the respective airport operator. Any transfer shall include the preparation of a transition plan to ensure the orderly transfer of assets and obligations. In accepting a transfer, the authority may assume no financial obligations other than those associated with the operation of the airport being transferred.
The authority may issue bonds, from time to time, payable from revenue of any facility or enterprise operated, acquired, or constructed by the authority, for any of the purposes authorized by this division in accordance with the Revenue Bond Law of 1941 (Chapter 6 (commencing with Section 54300) of Part 1 of Division 2 of Title 5 of the Government Code), excluding Article 3 (commencing with Section 54380) of Chapter 6 of Part 1 of Division 2 of Title 5 of the Government Code and the limitations set forth in subdivision (b) of Section 54402 of the Government Code which shall not apply to the issuance and sale of bonds pursuant to this section.
The authority is a local agency within the meaning of Section 54307 of the Government Code. The airport system or any or all facilities and all additions and improvements that the authority’s governing board authorizes to be acquired or constructed and any purpose, operation, facility, system, improvement, or undertaking of the authority from which revenues are derived or otherwise allocable, which revenues are, or may by resolution or ordinance be, required to be separately accounted for from other revenues of the authority, shall constitute an enterprise within the meaning of Section 54309 of the Government Code.
The authority’s governing board shall authorize the issuance of bonds pursuant to this section by resolution, which resolution shall be adopted by a majority vote and shall specify all of the following:
The purposes for which the bonds are to be issued, which may include any one or more purposes permitted by this division.
The maximum principal amount of bonds.
The maximum term of bonds.
The maximum rate of interest, fixed or variable, to be payable upon the bonds.
The maximum discount or premium payable on sale of the bonds.
For purposes of the issuance and sale of bonds pursuant to this section, the following definitions shall be applicable to the Revenue Bond Law of 1941:
Each resolution shall provide for the issuance of bonds in the amounts as may be necessary, until the full amount of bonds authorized has been issued. The full amount of bonds may be divided into two or more series with different dates of payment fixed for bonds of each series. A bond need not mature on its anniversary date.
The authority may issue refunding bonds to redeem or retire any bonds issued by the authority upon the terms, at the times, and in the manner which the authority’s governing body determines by resolution. Refunding bonds may be issued in a principal amount sufficient to pay all, or any part of, the principal of the outstanding bonds, the premium, if any due upon call redemption thereof prior to maturity, all expenses of redemption and either of the following:
The interest upon the refunding bonds from the date of sale thereof to the date of payment of the bonds to be refunded out of the sale of the refunding bonds or to the date upon which the bonds to be refunded will be paid pursuant to call or agreement with the holders of the bonds.
The interest upon the bonds to be refunded from the date of sale of the refunding bonds to the date of payment of the bonds to be refunded or to the date upon which the bonds to be refunded will be paid pursuant to call or agreement with the holders of the bonds.
The authority may enter into any liquidity or credit agreement it may deem necessary in connection with the issuance of bonds authorized by this section.
This section provides a complete, additional, and alternative method of performing the acts authorized by this section, and the issuance of bonds, including refunding bonds, need not comply with any other law applicable to borrowing or the issuance of bonds. Any provision of the Revenue Bond Law of 1941 which is inconsistent with this section or this division shall not be applicable.
Nothing in this section prohibits the authority from availing itself of any procedure provided in this chapter for the issuance of bonds of any type or character for any of the authorized airport facilities. All bond proceedings may be carried on simultaneously or, in the alternative, as the authority may determine.
The authority may levy special benefit assessments consistent with the requirements of Article XIII D of the California Constitution to finance capital improvements, including, but not limited to, special benefit assessments levied pursuant to any of the following:
The Improvement Act of 1911 (Division 7 (commencing with Section 5000) of the Streets and Highways Code).
The Improvement Bond Act of 1915 (Division 15 (commencing with Section 8500) of the Streets and Highways Code).
The Municipal Improvement Act of 1913 (Division 12 (commencing with Section 10000) of the Streets and Highways Code).
The Landscaping and Lighting Act of 1972 (Part 2 (commencing with Section 22500) of Division 15 of the Streets and Highways Code).
The authority may borrow money in accordance with Article 7 (commencing with Section 53820) of, Article 7.6 (commencing with Section 53850) of, or Article 7.7 (commencing with Section 53859) of, Chapter 4 of Part 1 of Division 2 of Title 5 of the Government Code.
The authority may borrow money in anticipation of the sale of any bonds that have been authorized to be issued, but have not been sold and delivered, and may issue negotiable bond anticipation notes therefor, and may renew the bond anticipation notes from time to time, but the maximum maturity of any bond anticipation notes, including the renewals thereof, may not exceed five years from the date of delivery of the original bond anticipation notes. The bond anticipation notes may be paid from any money of the authority available therefor and not otherwise pledged.
If not previously otherwise paid, the bond anticipation notes shall be paid from the proceeds of the next sale of the bonds of the authority in anticipation of which they were issued. The bond anticipation notes may not be issued in any amount in excess of the aggregate amount of bonds that the authority has been authorized to issue, less the amount of any bonds of the authorized issue previously sold, and also less the amount of other bond anticipation notes therefore issued and then outstanding. The bond anticipation notes shall be issued and sold in the same manner as the bonds. The bond anticipation notes and the resolution or resolutions authorizing them may contain any provisions, conditions, or limitations that a resolution of the authority authorizing the issuance of bonds may contain.
Exclusively for the purpose of securing financing or refinancing for any of the purposes permitted by this division through the issuance of bonds, notes, or other obligations, including certificates of participation, by a joint powers authority, and, notwithstanding any other provision contained in this division or any other law, the authority may borrow money or purchase or lease property from a joint powers authority and, in connection therewith, may sell or lease property to the joint powers authority, in each case at the interest rate or rates, maturity date or dates, installment payment or rental provisions, security, pledge of revenues and other assets, covenants to increase rates and charges, default, remedy and other terms or provisions as may be specified in the installment sale, lease, loan, loan purchase, or other agreement or agreements between the authority and the joint powers authority. The authority may enter into any liquidity or credit agreement it may deem necessary or appropriate in connection with any financing or refinancing authorized by this section. This section provides a complete, additional and alternative method of performing the acts authorized by this section, and the borrowing of money, incurring indebtedness, sale, purchase or lease of property from or to a joint powers authority, and any agreement for liquidity or credit enhancement entered into in connection therewith, pursuant to this section need not comply with the requirements of any other law applicable to borrowing, incurring indebtedness, sale, purchase, lease or credit except for compliance with this section.
The authority may bring an action to determine the validity of any of its bonds, equipment trust certificates, warrants, notes, or other evidences of indebtedness or any of its revenues, rates, or charges pursuant to Chapter 9 (commencing with Section 860) of Title 10 of Part 2 of the Code of Civil Procedure.
Notwithstanding any other provisions of this division or any other law, the provisions of all ordinances, resolutions, and other proceedings in the issuance by the authority of any bonds, bonds with a pledge of revenues, bonds for improvement districts, revenue bonds, equipment trust certificates, notes, or any and all evidences of indebtedness or liability constitute a contract between the authority and the holders of the bonds, equipment trust certificates, notes, or evidences of indebtedness or liability, and the provisions thereof are enforceable against the authority or any or all of its successors or assigns, by mandamus or any other appropriate suit, action, or proceeding in law or in equity in any court of competent jurisdiction.
Nothing in this division or in any other law shall be held to relieve the authority or the territory included within it from any bonded or other debt or liability contracted by the authority.
Upon dissolution of the authority or upon withdrawal of territory therefrom, that territory formerly included within the authority, or withdrawn therefrom, shall continue to be liable for the payment of all bonded and other indebtedness or liabilities outstanding at the time of the dissolution or withdrawal as if the authority had not been so dissolved or the territory withdrawn therefrom, and it shall be the duty of the successors or assigns to provide for the payment of the bonded and other indebtedness and liabilities.
To the extent provided in the proceedings for the authorization, issuance, and sale of any revenue bonds, bonds secured by a pledge of revenues, or bonds for improvement districts secured by a pledge of revenues, revenues of any kind or nature derived from any revenue-producing improvements, works, facilities, or property owned, operated, or controlled by the authority may be pledged, charged, assigned, and have a lien thereon for the payment of the bonds as long as the same are outstanding, regardless of any change in ownership, operation, or control of the revenue-producing improvements, works, facilities, or property and it shall, in any later event or events, be the duty of the successors or assigns to continue to maintain and operate the revenue-producing improvements, works, facilities, or property as long as bonds are outstanding.
The authority shall assume and be bound by the terms and conditions of employment set forth in any collective bargaining agreement or employment contract between the port and any labor organization or employee affected by the creation of the authority, as well as the duties, obligations, and liabilities arising from, or relating to, labor obligations imposed by state or federal law upon the port. Aviation division employees of the port affected by this division shall become employees of the authority and shall suffer no loss of employment or reduction in wages, health and welfare benefits, seniority, retirement benefits or contributions made to retirement plans, or any other term or condition of employment as a result of the enactment of this division. No employee of the port shall suffer loss of employment or reduction in wages or benefits as a result of the enactment of this division.
DIVISION 19. LOCAL TRANSPORTATION AUTHORITIES [180000. - 180305.]
CHAPTER 1. General Provisions [180000. - 180003.]
This division shall be known and may be cited as the Local Transportation Authority and Improvement Act.
The Legislature hereby finds and declares all of the following:
Local highway and transportation improvements and services are an immediate high priority needed to resolve local and regional transportation problems that threaten the economic viability and development potential of counties and cities and adversely impact the quality of life therein. Furthermore, regional transportation is a matter of statewide concern.
Comprehensive studies and reports have been completed by the Department of Transportation, the Assembly Office of Research, the Governor’s Task Force on Infrastructure, and the California Business Roundtable which conclude that there exists a local city street and county road maintenance backlog and shortfall of between five hundred million dollars ($500,000,000) and eight hundred forty million dollars ($840,000,000) annually.
In order to deal in an expeditious manner with current and future local transportation maintenance and improvement needs, local agencies need to develop and implement local funding programs that go significantly beyond current federal and state funding which is inadequate to resolve these problems.
It is in the public interest to allow the voters of each county to establish local transportation authorities and raise additional local revenues to provide highway capital improvements and maintenance and to meet local transportation needs in a timely manner.
It is the intent of the Legislature that funds generated pursuant to this division be used to supplement and not replace existing local revenues used for transportation purposes.
“Authority” means a local transportation authority created or designated pursuant to this division.
This division shall be liberally construed in order to effectuate its purposes. No inadvertent error, irregularity, informality, or the inadvertent neglect or omission of any officer, in any procedure taken under this division, other than fraud, shall void or invalidate that proceeding or any levy imposed to finance highway improvements or local transportation needs.
CHAPTER 2. Creation of Local Transportation Authority [180050. - 180052.]
A county board of supervisors may create an authority to operate within the county to carry out this division, or may designate a transportation planning agency designated pursuant to Section 29532 of the Government Code or created pursuant to the Fresno County Transportation Improvement Act pursuant to Division 15 (commencing with Section 142000), or a county transportation commission created pursuant to the County Transportation Act (Division 12 (commencing with Section 130000)) in existence in the county on January 1, 1988, to serve as an authority.
A board of supervisors that chooses to create an entirely new entity as an authority pursuant to Section 180050 shall determine the membership of the authority with the concurrence of a majority of the cities having a majority of the population in the incorporated area of the county.
Each member of the authority, and each alternate designated pursuant to subdivision (c), shall be an elected official of a local governmental entity within or partly within the county. Members of the board of supervisors serving on an authority shall comprise less than a majority of the authority.
Each member of the authority may have an alternate to vote or otherwise officially participate on behalf of the member at meetings of the authority when the member is not present. Either the member, or the alternate, but not both, may officially participate in a meeting of the authority. An alternate shall be designated as follows:
Except as specified in subparagraph (B), the local governmental entity that appointed the member shall designate the alternate.
A member who serves because the member holds a specified public office, as specified in the county transportation expenditure plan, shall designate his or her own alternate.
An alternate acting on behalf of a member has all of the rights, privileges, and responsibilities of a member.
Except as provided in subdivision (b), members of an authority which is an entirely new entity shall serve for a term of not more than four years.
At the first meeting of an authority which is an entirely new entity convened pursuant to Section 180112 the members shall be selected by lot to serve staggered terms.
CHAPTER 3. Administration [180100. - 180111.]
The authority at its first meeting, and thereafter annually at the meeting designated by the authority, shall elect a chairperson who shall preside at all meetings, and a vice chairperson who shall preside in the absence of the chairperson. In the event of their absence or inability to act, the members present, by an order entered in the minutes, shall select one of their members to act as chairperson pro tempore, who, while so acting, shall have all the authority of the chairperson.
The authority shall adopt rules for its proceedings consistent with the laws of the state.
A majority of the members of the authority constitutes a quorum for the transaction of business, and all official acts of the authority requires the affirmative vote of a majority of the members of the authority.
The acts of the authority shall be expressed by motion, resolution, or ordinance.
All meetings of the authority shall be conducted pursuant to Chapter 9 (commencing with Section 54950) of Part 1 of Division 2 of Title 5 of the Government Code.
The authority shall do all the following:
Adopt an annual budget.
Adopt an administrative code, by ordinance, which prescribes the powers and duties of the authority officers, the method of appointment of the authority employees, and methods, procedures, and systems of operation and management of the authority.
Cause a postaudit of the financial transactions and records of the authority to be made at least annually by a certified public accountant.
Do any and all things necessary to carry out the purposes of this division.
The authority may appoint a policy advisory committee.
The authority may hire an independent staff of its own or contract with any department or agency of the United States or with any public agency to implement this division.
The authority may contract with private entities in conformance with applicable procurement procedures for the procurement of engineering, project management, and contract management services.
The authority shall fix the compensation of its officers and employees.
Notice of the time and place of a public hearing on the adoption of the annual budget shall be published pursuant to Section 6061 of the Government Code not later than the 15th day prior to the day of the hearing.
The proposed annual budget shall be available for public inspection at least 15 days prior to the hearing.
The authority shall rely, to the extent possible, on existing state, regional, and local transportation planning and programming data and expertise, rather than on a large duplicative staff and set of plans.
The authority shall not expend more than 1 percent of the funds generated pursuant to this division in any year for salary and benefits of its staff.
The authority shall consult with, and coordinate its actions to secure funding for the completion and improvement of the priority regional highways, with the cities in the county, the board of supervisors, and the Department of Transportation, for the purpose of integrating its planned highway improvements with the highway and other transportation improvement plans and operations of other transportation agencies impacting the county.
The authority shall prepare and adopt an annual report each year on progress made to achieve the objective of improving transportation conditions related to priority highway operations and local transportation needs.
CHAPTER 4. Powers and Functions [180150. - 180154.]
The authority may sue and be sued, except as otherwise provided by law, in all actions and proceedings, in all courts and tribunals of competent jurisdiction.
All claims for money or damages against the authority are governed by Division 3.6 (commencing with Section 810) of Title 1 of the Government Code, except as provided therein, or by other statutes or regulations expressly applicable thereto.
The authority may make contracts and enter into stipulations of any nature whatsoever, either in connection with eminent domain proceedings or otherwise, including, but not limited to, contracts and stipulations to indemnify and hold harmless, to employ labor, and to do all acts necessary and convenient for the full exercise of the powers granted in this division.
The authority may contract with any department or agency of the United States, with any public agency, including, but not limited to, the Department of Transportation, any county, city, or district, or with any person or a private entity upon any terms and conditions that the authority finds in its best interest for the procurement of engineering, project management, and contract management services.
Contracts for the purchase of services, supplies, equipment, and materials in excess of ten thousand dollars ($10,000) shall be awarded to the lowest responsible bidder after competitive bidding, except in an emergency declared by the authority or by an executive committee to which the authority has delegated responsibility to make that declaration.
If, after rejecting bids received under subdivision (a), the authority determines and declares that, in its opinion, the services, supplies, equipment, or materials may be purchased at a lower price on the open market, the authority may proceed to purchase these services, supplies, equipment, or materials in the open market without further observance of the provisions regarding contracts, bids, or advertisements.
CHAPTER 5. Transactions and Use Taxes [180200. - 180207.]
The Legislature, by the enactment of this division, intends that the additional funds provided governmental agencies by this chapter shall supplement existing local revenues being used for public transportation purposes and that local governments maintain their existing commitment of local funds for transportation purposes.
The Legislature further intends that transportation authorities utilize “pay-as-you-go” financing as the preferred method of funding transportation improvements and operations authorized by Section 180205, and that bond financing be utilized as an alternative method of funding, where the scope of the planned expenditures makes “pay-as-you-go” financing unfeasible.
A retail transactions and use tax ordinance applicable in the incorporated and unincorporated territory of a county may be imposed by the authority in accordance with this chapter and Part 1.6 (commencing with Section 7251) of Division 2 of the Revenue and Taxation Code, if the tax ordinance is adopted by a two-thirds vote of the authority and imposition of the tax is subsequently approved by a majority of the electors voting on the measure, or by any otherwise applicable voter approval requirement, at a special election called for that purpose by the board of supervisors, at the request of the authority, and a county transportation expenditure plan is adopted pursuant to Section 180206.
A retail transactions and use tax approved by the electors shall remain in effect for the period of time specified in the tax ordinance. The tax may be continued in effect, or reimposed, by a tax ordinance adopted by a two-thirds vote of the authority and the reimposition of the tax is approved by any applicable majority of the electors.
The authority, in the ordinance, shall state the nature of the tax to be imposed, shall provide the tax rate or the maximum tax rate, shall specify the period during which the tax will be imposed, and shall specify the purposes for which the revenue derived from the tax will be used. The tax rate may be in 14 percent increments and shall not exceed a maximum tax rate of 1 percent.
The proposition shall include an appropriations limit for that entity pursuant to Section 4 of Article XIII B of the California Constitution.
The county shall conduct the special election called by the board of supervisors pursuant to Section 180201. If the measure is approved, the authority shall reimburse the county for its cost in conducting the special election.
The special election shall be called and conducted in the same manner as provided by law for the conduct of special elections by a county.
Except as otherwise provided in paragraph (2), the sample ballot to be mailed to the voters, pursuant to Section 13303 of the Elections Code, shall be the full proposition, as set forth in the ordinance calling the election, and the voter information guide shall include the entire adopted county transportation expenditure plan.
A county elections official, upon the request of an authority that posts the entire adopted county transportation expenditure plan on an Internet Web site maintained by the authority, may comply with paragraph (1) by printing, in the sample ballot, immediately below the full proposition, and in the voter information guide, in no less than 10-point bold type, text substantially as follows: “The adopted county transportation expenditure plan may be viewed electronically at [insert applicable Internet Web site address]. If you desire a printed copy of the adopted county transportation expenditure plan, please call the county elections office at [insert applicable telephone number] and one will be mailed to you at no cost.” If the county elections official exercises the authority under this paragraph, the county elections official shall provide a printed copy of the entire adopted county transportation expenditure plan by mail to each person requesting a copy.
A county that posts the entire adopted county transportation expenditure plan on an Internet Web site pursuant to subparagraph (A) shall ensure that the plan is posted in a manner that is easily accessible to voters.
Any transactions and use tax ordinance adopted pursuant to this chapter shall be operative on the first day of the first calendar quarter commencing more than 110 days after adoption of the ordinance.
Prior to the operative date of the ordinance, the authority shall contract with the State Board of Equalization to perform all functions incidental to the administration and operation of the ordinance.
The revenues from the taxes imposed pursuant to this chapter may be allocated by the authority for the construction and improvement of state highways, the construction, maintenance, improvement, and operation of local streets, roads, and highways, and the construction, improvement, and operation of public transit systems. For purposes of this section, “public transit systems” includes paratransit services.
A county transportation expenditure plan shall be prepared for the expenditure of the revenues expected to be derived from the tax imposed pursuant to this chapter, together with other federal, state, and local funds expected to be available for transportation improvements, for the period during which the tax is to be imposed.
A county transportation expenditure plan shall not be adopted until it has received the approval of the board of supervisors and of the city councils representing both a majority of the cities in the county and a majority of the population residing in the incorporated areas of the county.
The plan shall be adopted prior to the call of the election provided for in Section 180201.
The authority may annually review and propose amendments to the county transportation expenditure plan adopted pursuant to Section 180206 to provide for the use of additional federal, state, and local funds, to account for unexpected revenues, or to take into consideration unforeseen circumstances.
The authority shall notify the board of supervisors and the city council of each city in the county and provide them with a copy of the proposed amendments.
The proposed amendments shall become effective 45 days after notice is given.
CHAPTER 6. Bonds [180250. - 180264.]
As part of the ballot proposition to approve the imposition of a retail transactions and use tax, authorization may be sought to issue bonds to finance capital outlay expenditures as may be provided for in the adopted county transportation expenditure plan, payable from the proceeds of the tax.
The maximum bonded indebtedness which may be outstanding at any one time shall be an amount equal to the sum of the principal of, and interest on, the bonds, but not to exceed the estimated proceeds of the tax, as determined by the plan. The amount of bonds outstanding at any one time does not include the amount of bonds, refunding bonds, or bond anticipation notes for which funds necessary for the payment thereof have been set aside for that purpose in a trust or escrow account.
Notwithstanding any other provision of law, if the imposition of a retail transactions and use tax, together with the establishment of an appropriations limit of seven hundred sixty-five million dollars ($765,000,000), was approved by the voters of a county pursuant to Section 180250 on November 8, 1988, and if the ordinance adopted by the authority which requested the board of supervisors to submit the proposition for approval of that tax and appropriations limit by the voters authorized the issuance of bonds payable from that tax, that authority may issue bonds, refunding bonds, or bond anticipation notes pursuant to this chapter.
The bonds authorized by the voters concurrently with the approval of the retail transactions and use tax may be issued at any time by the authority and shall be payable from the proceeds of the tax. The bonds shall be referred to as “limited tax bonds.” The bonds may be secured by a pledge of revenues from the proceeds of the tax.
The pledge of the tax to the limited tax bonds authorized under this chapter shall have priority over the use of any of the tax for “pay-as-you-go” financing, except to the extent that that priority is expressly restricted in the resolution authorizing the issuance of the bonds.
Limited tax bonds shall be issued pursuant to a resolution adopted at any time by a two-thirds vote of the authority. Each resolution shall provide for the issuance of bonds in the amounts as may be necessary, until the full amount of bonds authorized have been issued. The full amount of bonds may be divided into two or more series and different dates of payment fixed for the bonds of each series. A bond need not mature on its anniversary date.
A resolution authorizing the issuance of bonds shall state all of the following:
The purposes for which the proposed debt is to be incurred, which may include all costs and estimated costs incidental to, or connected with, the accomplishment of those purposes, including, without limitation, engineering, inspection, legal, fiscal agents, financial consultant and other fees, bond and other reserve funds, working capital, bond interest estimated to accrue during the construction period and for a period not to exceed three years thereafter, and expenses of all proceedings for the authorization, issuance, and sale of the bonds.
The estimated cost of accomplishing those purposes.
The amount of the principal of the indebtedness.
The maximum term the bonds proposed to be issued shall run before maturity, which shall not be beyond the date of termination of the imposition of the retail transactions and use tax.
The maximum rate of interest to be paid, which shall not exceed the maximum allowable by law.
The denomination or denominations of the bonds, which shall not be less than five thousand dollars ($5,000).
The form of the bonds, including, without limitation, registered bonds and coupon bonds, to the extent permitted by federal law, and the form of any coupons to be attached thereto, the registration, conversion, and exchange privileges, if any, pertaining thereto, and the time when all of, or any part of, the principal becomes due and payable.
The resolution may also contain any other matters authorized by this chapter or any other law.
The bonds shall bear interest at a rate or rates not exceeding the maximum allowable by law, payable at intervals determined by the commission.
In the resolution authorizing the issuance of the bonds, the authority may also provide for the call and redemption of the bonds prior to maturity at the times and prices and upon other terms as specified. However, no bond is subject to call or redemption prior to maturity, unless it contains a recital to that effect or unless a statement to that effect is printed.
The principal of, and interest on, the bonds shall be payable in lawful money of the United States at the office of the treasurer of the authority, or at other places as may be designated, or at both the office and other places at the option of the holders of the bonds.
The bonds, or each series of bonds, shall be dated and numbered consecutively and shall be signed by the chairperson, vice chairperson, or other authorized officer of the authority and the auditor-controller of the authority, and the official seal, if any, of the authority shall be attached.
The interest coupons of the bonds shall be signed by the auditor-controller of the authority. All of the signatures and seal may be printed, lithographed, or mechanically reproduced.
If any officer whose signature appears on the bonds or coupons ceases to be that officer before the delivery of the bonds, the officer’s signature is as effective as if the officer had remained in office.
The bonds may be sold as the authority determines by resolution, and the bonds may be sold at a price below par, whether by negotiated or public sale.
Delivery of any bonds may be made at any place either inside or outside the state, and the purchase price may be received in cash or bank credits.
All accrued interest received on the sale of the bonds shall be placed in the fund to be used for the payment of the principal of, and interest on, the bonds, and the remainder of the proceeds of the bonds shall be placed in the treasury of the authority and applied to secure the bonds or for the purposes for which the debt was incurred. However, when the purposes have been accomplished, any money remaining shall be either (a) transferred to the fund to be used for the payment of principal of, and interest on, the bonds or (b) placed in a fund to be used for the purchase of the outstanding bonds in the open market at prices and in the manner, either at public or private sale or otherwise, as determined by the authority. Bonds so purchased shall be canceled immediately.
The authority may provide for the issuance, sale, or exchange of refunding bonds to redeem or retire any bonds issued by the authority upon the terms, at the times and in the manner which it determines.
Refunding bonds may be issued in a principal amount sufficient to pay all, or any part of, the principal of the outstanding bonds, the premiums, if any, due upon call and redemption thereof prior to maturity, all expenses of the refunding, and either of the following:
The interest upon the refunding bonds from the date of sale thereof to the date of payment of the bonds to be refunded out of the proceeds of the sale of the refunding bonds or to the date upon which the bonds to be refunded will be paid pursuant to call or agreement with the holders of the bonds.
The interest upon the bonds to be refunded from the date of sale of the refunding bonds to the date of payment of the bonds to be refunded or to the date upon which the bonds to be refunded will be paid pursuant to call or agreement with the holder of the bonds.
The provisions of this chapter for the issuance and sale of bonds apply to the issuance and sale of refunding bonds.
The authority may borrow money in anticipation of the sale of bonds which have been authorized pursuant to this chapter, but which have not been sold or delivered, and may issue negotiable bond anticipation notes therefor and may renew the bond anticipation notes from time to time. However, the maximum maturity of any bond anticipation notes, including the renewals thereof, shall not exceed five years from the date of delivery of the original bond anticipation notes.
The bond anticipation notes, and the interest thereon, may be paid from any money of the authority available therefor, including the revenues from the tax. If not previously otherwise paid, the bond anticipation notes, or any portion thereof, or the interest thereon, shall be paid from the proceeds of the next sale of the bonds of the agency in anticipation of which the notes were issued.
The bond anticipation notes shall not be issued in any amount in excess of the aggregate amount of the bonds which the authority has been authorized to issue, less the amount of any bonds of the authorized issue previously sold, and also less the amount of other bond anticipation notes therefor issued and then outstanding. The bond anticipation notes shall be issued and sold in the same manner as the bonds.
The bond anticipation notes and the resolutions authorizing them may contain any provisions, conditions, or limitations which a resolution of the authority may contain.
Any bonds issued under this chapter are legal investment for all trust funds; for the funds of insurance companies, commercial and savings banks, and trust companies; and for state school funds; and whenever any money or funds may, by any law now or hereafter enacted, be invested in bonds of cities, counties, school districts, or other districts within the state, that money or funds may be invested in the bonds issued under this chapter, and whenever bonds of cities, counties, school districts, or other districts within the state may, by any law now or hereafter enacted, be used as security for the performance of any act or the deposit of any public money, the bonds issued under this chapter may be so used. The provisions of this chapter are in addition to all other laws relating to legal investments and shall be controlling as the latest expression of the Legislature with respect thereto.
Any action or proceedings wherein the validity of the adoption of the retail transactions and use tax ordinance provided for in this chapter or the issuance of any bonds thereunder or any of the proceedings in relation thereto is contested, questioned, or denied, shall be commenced within six months from the date of the election at which the ordinance is approved; otherwise, the bonds and all proceedings in relation thereto, including the adoption and approval of the ordinance, shall be held to be valid and in every respect legal and incontestable.
CHAPTER 7. Sacramento Transportation Authority [180300. - 180305.]
The Legislature finds and declares all of the following:
In the County of Sacramento, the authority seeks to address local transportation needs by raising additional local revenue to fund transportation projects and programs.
Constitutional voting thresholds applicable to local taxes have created challenges for the adoption of countywide sales tax measures. The adoption of this chapter is intended, in part, to allow the authority to seek voter approval of a transportation improvement sales tax in a portion of the county.
The County of Sacramento is unique in having a large, developed unincorporated population and seven cities with older commercial corridors that have potential for infill but which regularly experience construction-related disruptions and pavement deterioration. To reduce these localized impacts and limit the need for future transportation system expansion, the authority must be able to fund coordinated infrastructure improvements that support infill development as part of a single project.
Unless expressly stated in this chapter, the provisions set forth in this division apply to the authority. This chapter is not intended to limit or otherwise conflict with the other provisions of this division.
For purposes of this chapter, unless the context requires otherwise, the following definitions apply:
“Active transportation” means infrastructure facilities or services that encourage increased use of active modes of transportation, such as biking and walking, and includes projects consistent with subdivision (f) of Section 2382 of the Streets and Highways Code.
“Authority” means the Sacramento Transportation Authority created in 1988 pursuant to Chapter 2 (commencing with Section 180050).
“CARTA” means the Capital Area Regional Tolling Authority.
“Expenditure plan” means a county transportation expenditure plan adopted in connection with a transactions and use tax ordinance pursuant to Section 180206.
“Governing board” means the governing board of the authority.
“Member” or “member of the governing board” means an individual county supervisor or city council member who has been appointed to the governing board, or their alternate.
“Ordinance” means a transactions and use tax ordinance authorized pursuant to Chapter 5 (commencing with Section 180200).
The authority may issue bonds to finance costs of high-occupancy toll lanes or other toll facilities within the County of Sacramento approved by the California Transportation Commission pursuant to Section 149.7 of the Streets and Highways Code, including, without limitation, working capital costs, costs of issuance and credit enhancement, capitalized interest, and all reserves and other fees or costs related to the bonds. Those bonds may be payable from toll revenue or any other funds lawfully available to the authority for such purposes, including sales tax revenue, development impact fees, or state and federal grant funds.
Before the authority issues bonds payable from toll revenue for a toll facility operated by CARTA, both of the following shall occur:
The authority shall enter into an agreement with CARTA regarding the application of toll revenue to pay for bonds issued by the authority.
The governing board of CARTA shall review and approve a toll facility expenditure plan.
Bonds issued pursuant to this section may be sold pursuant to the terms and conditions set forth in a resolution adopted by the governing board. Bonds shall be issued pursuant to a resolution adopted by a two-thirds vote of the governing board, which resolution shall state the maximum principal amount of the bonds, the maximum term of the bonds, and the maximum rate of interest to be paid on the bonds, not to exceed the maximum rate permitted by law. Any bond issued pursuant to this section shall not constitute a debt or liability of the state and shall contain on its face a statement to the following effect:
“Neither the full faith and credit nor the taxing power of the State of California is pledged to the payment of principal or interest of this bond.”
The maximum rate of interest payable upon the bonds issued pursuant to this section shall not exceed the maximum rate specified in Section 53531 of the Government Code. The rate may be either fixed or variable and shall be payable at the times and in the manner specified in the resolution.
The allowable expenditure categories set forth in Section 180205 shall also include the construction, modernization, and improvement of infrastructure that supports infill or transit-oriented development, in areas nominated by local governments, and included in regionally adopted plans that advance state greenhouse gas emissions reduction objectives.
The authority may only allocate revenues for a facility described in paragraph (2) of subdivision (c) if that facility is combined with a project that includes a facility described in paragraph (1) of subdivision (c).
An expenditure plan shall not allocate more than 5 percent of the total revenues derived from the tax for facilities described in paragraph (2) of subdivision (c).
For purposes of this section, “infrastructure” means any of the following:
This section does not apply to a retail transactions and use tax approved by the electors before January 1, 2026.
An ordinance and corresponding expenditure plan may be imposed by the authority in a geographic area that comprises less than the total area of the County of Sacramento, including its incorporated cities, subject to the guidelines set forth in subdivision (c).
An ordinance and expenditure plan described in paragraph (1) shall be adopted by at least a two-thirds vote of the total membership of the governing board.
An ordinance described in paragraph (1) shall be subject to voter approval by the electors in the area to which the tax applies.
Notwithstanding Section 180102, if an ordinance and expenditure plan for a portion of the County of Sacramento are approved pursuant to the process set forth in Chapter 5 (commencing with Section 180200), all subsequent governing board decisions and actions related to implementation of that ordinance and expenditure plan, including an action to amend the expenditure plan pursuant to Section 180207, shall be made by a majority of both of the following:
Those members representing the city or cities subject to the ordinance, if any.
All members appointed from the board of supervisors.
The governing board shall determine the area to which the tax would apply before the electors vote on the measure. If the tax only applies to a portion of the county, all of the following shall apply:
The area to be taxed shall include at least the incorporated area from two cities or the incorporated area from one city and the unincorporated area from the county.
All revenues derived from the tax shall be expended for the primary benefit of the portion of the county in which the tax is imposed. Expenditures made within that portion of the county are deemed to confer a primary benefit. The authority shall, as part of the expenditure plan, adopt objective eligibility guidelines that define primary benefit. The expenditure plan, including those guidelines, shall be made readily accessible to voters in the manner required by Section 180203. Any revenues derived from the tax shall supplement, and not supplant, other transportation revenues available to the portion of the county to which the tax applies.
Notwithstanding subdivision (b) of Section 180206, an expenditure plan applicable to a portion of the county shall not be adopted until it has received the approval of the board of supervisors and of the city councils representing both a majority of the cities included within the area subject to the tax and a majority of the population residing in the incorporated areas subject to the tax.
Unless otherwise stated in this chapter, the other provisions of this division that apply to an ordinance and expenditure plan shall also apply to an ordinance and expenditure plan applicable to a portion of the county, including the authority to issue bonds pursuant to Chapter 6 (commencing with Section 180250).
The term “district,” as defined and used in Sections 7252, 7261, and 7262 of the Revenue and Taxation Code, shall not be interpreted to preclude the authority from imposing a transactions and use tax in accordance with the Transactions and Use Tax Law (Part 1.6 (commencing with Section 7251) of Division 2 of the Revenue and Taxation Code) in an area that comprises less than the total geographic jurisdiction of the authority, so long as all other applicable requirements of that law are complied with.
DIVISION 19.1. SONOMA COUNTY REGIONAL CLIMATE PROTECTION AUTHORITY [181000. - 181015.]
The Sonoma County Regional Climate Protection Authority is hereby created. For the purposes of this division, “authority” means the Sonoma County Regional Climate Protection Authority.
The authority is a public instrumentality governed by the same board as that governing the Sonoma County Transportation Authority. The authority is, however, a separate entity from the Sonoma County Transportation Authority.
The authority, in cooperation with local agencies that elect to participate, may perform coordination and implementation activities, within the boundaries of Sonoma County, to assist those agencies in meeting their greenhouse gas emission reduction goals as set forth in resolutions and adopted plans and develop, coordinate, and implement programs and policies to comply with Chapter 488 of the Statutes of 2006 and other federal or state mandates and programs designed to respond to greenhouse gas emissions and climate change. “Local agency,” as used in this division, shall mean a county, city, whether general law or chartered, city and county, town, school district, municipal corporation, district, political subdivision, or any board, commission, or agency thereof, or other local public agency.
Activities authorized under Section 181003 shall include, but not be limited to, the following:
Reduction of energy consumption.
Coordination and implemention of energy efficiency projects.
Increasing efficiency of water use.
Utilizing carbon sequestration opportunities.
Administration of grants to local entities.
Alternative transportation options.
Measuring and quantifying ongoing greenhouse gas reductions.
The authority shall adopt rules for its proceedings consistent with the laws of the state.
A majority of the members of the authority constitutes a quorum for the transaction of business, and all official acts of the authority require the affirmative vote of a majority of the members of the authority.
The acts of the authority shall be expressed by motion, resolution, or ordinance.
All meetings of the authority shall be conducted pursuant to Chapter 9 (commencing with Section 54950) of Part 1 of Division 2 of Title 5 of the Government Code.
The authority shall do all of the following:
Adopt an annual budget.
Adopt an administrative code, by ordinance, which prescribes the powers and duties of the authority officers, the method of appointment of the authority employees, and methods, procedures, and systems of operation and management of the authority.
Cause a postaudit of the financial transactions and records of the authority to be made at least annually by a certified public accountant.
Do any and all things necessary to carry out the purposes of this division.
The members of the authority shall be compensated as determined by the authority and shall be reimbursed for necessary and reasonable expenses incurred in connection with performing authority duties.
Notice of the time and place of a public hearing on the adoption of the annual budget shall be published pursuant to Section 6061 of the Government Code not later than 15 days prior to the hearing.
The proposed annual budget shall be available for public inspection at least 15 days prior to the hearing.
The authority may sue and be sued, except as provided by law, in all actions and proceedings, in all courts and tribunals of competent jurisdiction.
All claims for money or damages against the authority are governed by Division 3.6 (commencing with Section 810) of Title 1 of the Government Code, except as provided therein, or by other statute or regulation expressly applicable thereto.
The authority may apply for funds available to carry out its functions and may receive grants of funds to carry out its functions. All funds available to the authority shall be held in a separate account and accounted for independently. No transportation funds may be used for purposes of this division other than those activities of the authority related to transportation. No funding from the Traffic Relief Act for Sonoma County (Measure M), approved by voters in 2004 shall be used for the purpose of this division.
Nothing in this division shall supersede or interfere with activities, plans, or actions of other local agencies.
DIVISION 19.5. CALIFORNIA HIGH-SPEED RAIL SERVICE [185000. - 185511.]
CHAPTER 1. General Provisions,Findings, and Definitions [185000. - 185012.]
This division shall be known, and may be cited, as the California High-Speed Rail Act.
The Legislature hereby finds and declares all of the following:
California, over the past decades, has built an extensive network of freeways and airports to meet the state’s growing transportation needs.
These facilities are not adequate to meet the mobility needs of the current population.
The population of the state and the travel demands of its citizens are expected to continue to grow at a rapid rate.
The cost of expanding the current network of highways and airports fully to meet current and future transportation needs is prohibitive, and a total expansion strategy would be detrimental to air quality.
Intercity rail service, when coordinated with urban transit and airports, is an efficient, practical, and less polluting transportation mode that can fill the gap between future demand and present capacity.
Advances in rail technology have allowed intercity rail systems in Europe and Japan to attain speeds of up to 200 miles per hour and compete effectively with air travel for trips in the 200 to 500-mile range.
Development of a high-speed rail system is a necessary and viable alternative to automobile and air travel in the state.
In order for the state to have a comprehensive network of high-speed intercity rail systems by the year 2020, it must begin preparation of a high-speed intercity rail plan similar to California’s former freeway plan and designate an entity with stable and predictable funding sources to implement the plan.
Utilizing existing human and manufacturing resources to build a large network of high-speed rail systems will generate jobs and economic growth for today’s population and produce a transportation network for future generations.
Upon confirmation of the need and costs by detailed studies, the private sector, together with the state, can build and operate new high-speed intercity rail systems utilizing private and public financing.
The existing high-speed rail commission is completing its work and a successor authority to continue planning is necessary.
As used in this division, unless the context requires otherwise, the following terms have the following meanings:
“Authority” means the High-Speed Rail Authority.
“Department” means the Department of Transportation.
“High-speed rail” means intercity passenger rail service that utilizes an alignment and technology that makes it capable of sustained speeds of 200 miles per hour or greater.
CHAPTER 2. The High-Speed Rail Authority [185020. - 185024.]
There is in the Transportation Agency a High-Speed Rail Authority.
The authority is composed of 11 members as follows:
Five members appointed by the Governor.
Two members appointed by the Senate Committee on Rules.
Two members appointed by the Speaker of the Assembly.
One Member of the Senate appointed by the Senate Committee on Rules and one Member of the Assembly appointed by the Speaker of the Assembly shall be ex officio members without vote and shall participate in the activities of the authority to the extent that participation is not incompatible with their positions as Members of the Legislature.
For the purposes of making appointments to the authority pursuant to subparagraphs (A), (B), and (C) of paragraph (1), the Governor, the Senate Committee on Rules, and the Speaker of the Assembly shall take into consideration geographical diversity to ensure that all regions of the state are adequately represented.
Except as provided in subdivision (d), and until their successors are appointed, members of the authority, other than members appointed pursuant to subparagraphs (C) and (D) of paragraph (1) of subdivision (b), shall hold office for terms of four years. A vacancy shall be filled by the appointing power making the original appointment, by appointing a member to serve the remainder of the term or, in the case of a member appointed by the Speaker of the Assembly, at the pleasure of the Speaker of the Assembly.
Members of the authority are subject to the Political Reform Act of 1974 (Title 9 (commencing with Section 81000) of the Government Code).
From among its voting members, the authority shall elect a chairperson, who shall preside at all meetings of the authority, and a vice chairperson to preside in the absence of the chairperson. The chairperson shall serve a term of one year.
Five voting members of the authority constitute a quorum for taking any action by the authority.
Each voting member of the authority shall receive compensation of one hundred dollars ($100) for each day that the member is attending to the business of the authority, but shall not receive more than five hundred dollars ($500) in any calendar month.
Voting members of the authority shall be reimbursed for their actual travel expenses incurred in attending to the business of the authority.
The authority shall appoint an executive director, exempt from civil service, who shall serve at the pleasure of the authority, to administer the affairs of the authority as directed by the authority.
For purposes of managing and administering the ongoing work of the authority in implementing the high-speed train project, the Governor, upon the recommendation of the executive director, may appoint up to six additional individuals, exempt from civil service, who shall serve at the pleasure of the executive director. Pursuant to this subdivision, the Governor may appoint persons only for the following positions:
Chief program manager.
Up to three regional directors.
Chief financial officer.
Director of risk management and project controls.
The compensation of the executive director and the additional persons authorized by subdivision (b) shall be established by the authority, and approved by the Department of Human Resources, in an amount that is reasonably necessary, in the discretion of the authority, to attract and hold a person of superior qualifications. The authority shall cause to be conducted, through the use of independent outside advisers, a salary survey to determine the compensation for the positions under this subdivision. The Department of Human Resources may, in its discretion, accept a previously completed salary survey that meets the requirements of this subdivision, and shall review the methodology used in the survey. The salary survey shall consider both of the following:
The executive director may, as authorized by the authority, appoint necessary staff to carry out the provisions of this part.
CHAPTER 3. Responsibilities of the Authority [185030. - 185038.]
The authority shall direct the development and implementation of intercity high-speed rail service that is fully integrated with the state’s existing intercity rail and bus network, consisting of interlinked conventional and high-speed rail lines and associated feeder buses. The intercity network in turn shall be fully coordinated and connected with commuter rail lines and urban rail transit lines developed by local agencies, as well as other transit services, through the use of common station facilities whenever possible.
Upon an appropriation in the Budget Act for that purpose, the authority shall prepare a plan for the construction and operation of a high-speed train network for the state, consistent with and continuing the work of the Intercity High-Speed Rail Commission conducted prior to January 1, 1997. The plan shall include an appropriate network of conventional intercity passenger rail service and shall be coordinated with existing and planned commuter and urban rail systems.
The authorization and responsibility for planning, construction, and operation of high-speed passenger train service at speeds exceeding 125 miles per hour in this state is exclusively granted to the authority.
Except as provided in paragraph (2), nothing in this subdivision precludes other local, regional, or state agencies from exercising powers provided by law with regard to planning or operating, or both, passenger rail service.
The authority shall prepare, publish, adopt, and submit to the Legislature, not later than May 1, 2014, and every two years thereafter, a business plan. At least 60 days prior to the publication of the plan, the authority shall publish a draft business plan for public review and comment. The draft plan shall also be submitted to the Senate Committee on Transportation and Housing, the Assembly Committee on Transportation, the Senate Committee on Budget and Fiscal Review, and the Assembly Committee on Budget.
The business plan shall include, but need not be limited to, all of the following elements:
A description of the type of service the authority is developing and the proposed chronology for the construction of the statewide high-speed rail system, and the estimated capital costs for each segment or combination of segments.
A forecast of the expected patronage, service levels, and operating and maintenance costs for the Phase 1 corridor as identified in paragraph (2) of subdivision (b) of Section 2704.04 of the Streets and Highways Code and by each segment or combination of segments for which a project level environmental analysis is being prepared for Phase 1. The forecast shall assume a high, medium, and low level of patronage and a realistic operating planning scenario for each level of service.
Alternative financial scenarios for different levels of service, based on the patronage forecast in subparagraph (B), and the operating break-even points for each alternative. Each scenario shall assume the terms of subparagraph (J) of paragraph (2) of subdivision (c) of Section 2704.08 of the Streets and Highways Code.
The expected schedule for completing environmental review, and initiating and completing construction for each segment or combination of segments of Phase 1.
An estimate and description of the total anticipated federal, state, local, and other funds the authority intends to access to fund the construction and operation of the system, and the level of confidence for obtaining each type of funding.
Any written agreements with public or private entities to fund components of the high-speed rail system, including stations and terminals, and any impediments to the completion of the system.
Alternative public-private development strategies for the implementation of Phase 1.
A discussion of all reasonably foreseeable risks the project may encounter, including, but not limited to, risks associated with the project’s finances, patronage, right-of-way acquisition, environmental clearances, construction, equipment, and technology, and other risks associated with the project’s development. The plan shall describe the authority’s strategies, processes, or other actions it intends to utilize to manage those risks.
To the extent feasible, the business plan should draw upon information and material developed according to other requirements, including, but not limited to, the preappropriation review process and the preexpenditure review process in the Safe, Reliable High-Speed Passenger Train Bond Act for the 21st Century pursuant to Section 2704.08 of the Streets and Highways Code. The authority shall hold at least one public hearing on the business plan and shall adopt the plan at a regularly scheduled meeting. When adopting the plan, the authority shall take into consideration comments from the public hearing and written comments that it receives in that regard, and any hearings that the Legislature may hold prior to adoption of the plan.
On or before March 1, 2017, and every two years thereafter, the authority shall provide a project update report, approved by the Secretary of Transportation as consistent with the criteria in this section, to the budget committees and the appropriate policy committees of both houses of the Legislature, on the development and implementation of intercity high-speed train service pursuant to Section 185030. The report, at a minimum, shall include a programwide summary, as well as details by project segment, with all information necessary to clearly describe the status of the project, including, but not limited to, all of the following:
A summary describing the overall progress of the project.
The baseline budget for all project phase costs, by segment or contract, beginning with the California High-Speed Rail Program Revised 2012 Business Plan.
The current and projected budget, by segment or contract, for all project phase costs.
Expenditures to date, by segment or contract, for all project phase costs.
A comparison of the current and projected work schedule and the baseline schedule contained in the California High-Speed Rail Program Revised 2012 Business Plan.
A summary of milestones achieved during the prior two-year period and milestones expected to be reached in the coming two-year period.
Any issues identified during the prior two-year period and actions taken to address those issues.
A thorough discussion of risks to the project and steps taken to mitigate those risks.
For purposes of this section, the following definitions apply:
“Merced to Bakersfield segment” means a 171-mile electrified dual-track segment that is usable for high-speed rail service in the central valley from Merced to Bakersfield, with a new combined station in downtown Merced, and connections to the Amtrak San Joaquins and the Altamont Corridor Express.
“Phase 1 System” means Phase 1 of the high-speed train project described in Section 2704.04 of the Streets and Highways Code.
As part of the project update report that is due on or before March 1, 2023, pursuant to Section 185033.5, the authority shall develop schedules related to the delivery of all of the following tasks:
Completion of the 119-mile dual track segment from Madera to Poplar Avenue, which means Avenue 19 in the County of Madera to one mile north of the Tulare-Kern county line southward to north of Bakersfield, currently near Poplar Avenue.
Completion of right-of-way, planning, and advance engineering for extensions to Merced and Bakersfield.
Completion of an agreement or agreements between the state, the San Joaquin Joint Powers Authority, the San Joaquin Regional Rail Commission, and the authority that details the role of each in planning, constructing, and funding the connection in the City of Merced.
Completion of an agreement or agreements between the state, the San Joaquin Joint Powers Authority, the San Joaquin Regional Rail Commission, and the authority covering the planning, funding, and operation of the proposed high-speed rail services from Merced to Bakersfield and the authority and approval for the San Joaquin Joint Powers Authority to contract for the operation of the high-speed rail services.
Provision of an updated cost estimate with a stated probability level, or levels, of its ongoing contracts and for the work it is funding and managing that is required to complete the Merced to Bakersfield segment extensions.
Completion of a funding plan that includes any additional federal funding awards for the Merced to Bakersfield segment.
Additional milestones required for the completion of the Merced to Bakersfield segment and the full Phase 1 System pursuant to subparagraphs (A) to (F), inclusive.
As part of the business plan that is due on or before May 1, 2026, pursuant to Section 185033, the authority shall provide a detailed funding plan for the Merced to Bakersfield segment that includes all of the following information:
An updated estimate of the funding gap for completing the segment.
A strategy for addressing the funding gap that includes all of the following:
An itemized list of anticipated funds by source.
A timeline describing when each source of funds must be received in order to meet the authority’s schedule for segment completion.
The estimated project delays that would result if any funding source fails to materialize, and a discussion of how work could be resequenced to minimize these delays.
An assessment of the likelihood that each proposed source of funding will materialize, including the identification of any major risks for obtaining the funding and a plan for mitigating those risks.
Options for initiating service on the segment described in subparagraph (A) of paragraph (1) of subdivision (b) of Section 185033.7 and the estimated schedule and costs associated with the service.
For purposes of this section, “Merced to Bakersfield segment” has the same meaning as defined in Section 185033.7.
The authority may do any of the following:
Conduct engineering and other studies related to the selection and acquisition of rights-of-way and the selection of a franchisee, including, but not limited to, environmental impact studies, socioeconomic impact studies, and financial feasibility studies.
Evaluate alternative high-speed rail technologies, systems and operators, and select an appropriate high-speed rail system.
Establish criteria for the award of a franchise.
Accept grants, fees, and allocations from the state, from political subdivisions of the state or from the federal government, foreign governments, and private sources.
Select a proposed franchisee, a proposed route, and proposed terminal sites.
Enter into contracts with public and private entities for the preparation of the plan.
Prepare a detailed financing plan, including any necessary taxes, fees, or bonds to pay for the construction of the high-speed train network.
Develop a proposed high-speed rail financial plan, including necessary taxes, bonds, or both, or other indebtedness, and submit the plan to the Legislature and to the Governor.
Keep the public informed of its activities.
For purposes of Article 3 (commencing with Section 87300) of Chapter 7 of Title 9 of the Government Code, each individual who is selected by the authority to serve in a peer review capacity to the authority shall be deemed to be a designated employee of the authority, and the authority shall be deemed to be the appointing power. Statements required to be filed pursuant to Section 87302 of the Government Code shall be filed with the authority.
The authority shall establish an independent peer review group for the purpose of reviewing the planning, engineering, financing, and other elements of the authority’s plans and issuing an analysis of appropriateness and accuracy of the authority’s assumptions and an analysis of the viability of the authority’s financing plan, including the funding plan for each corridor required pursuant to subdivision (b) of Section 2704.08 of the Streets and Highways Code.
The peer review group shall include all of the following:
Two individuals with education and experience in the planning and construction of large transportation systems, such as high-speed rail, or highway systems with similar characteristics, designated by the Treasurer.
Two individuals, one with experience in engineering and construction of high-speed rail or similar large infrastructure projects and one with experience in project planning and finance, designated by the Controller.
One representative from a financial services or financial consulting firm who shall not have been a contractor or subcontractor of the authority for the previous three years, designated by the Director of Finance.
One representative with experience in environmental planning, designated by the Secretary of Transportation.
Two individuals with experience providing or governing intercity or commuter passenger train services in California, designated by the Secretary of Transportation.
The peer review group shall evaluate the authority’s funding plans and prepare its independent judgment as to the feasibility and reasonableness of the plans, appropriateness of assumptions, analyses, and estimates, and any other observations or evaluations it deems necessary.
The authority shall provide the peer review group any and all information that the peer review group may request to carry out its responsibilities.
The peer review group shall report its findings and conclusions to the Legislature no later than 60 days after receiving the plans.
Upon approval by the Legislature, by the enactment of a statute, or approval by the voters of a financial plan providing the necessary funding for the construction of a high-speed network, the authority may do any of the following:
Enter into contracts with private or public entities for the design, construction, and operation of high-speed trains. The contracts may be separated into individual tasks or segments or may include all tasks and segments, including a design-build or design-build-operate contract.
Acquire rights-of-way through purchase or eminent domain.
Issue debt, secured by pledges of state funds, federal grants, or project revenues. The pledge of state funds shall be limited to those funds expressly authorized by statute or voter-approved initiatives.
Enter into cooperative or joint development agreements with local governments or private entities.
Set fares and schedules.
Relocate highways and utilities.
The authority shall make every effort to purchase high-speed train rolling stock and related equipment that are manufactured in California, as defined in subdivision (b), consistent with federal law and any other applicable provision of state law.
For purposes of this section, the following terms have the following meanings:
“Manufactured in California” means that the rolling stock and related equipment are manufactured in whole or in substantial part within California or that the majority of the component parts of the rolling stock and related equipment were manufactured in whole or in substantial part in California.
“Manufactured” means an activity of converting or conditioning property by changing the form, composition, quality, or character of the property for ultimate sale at retail or use in the manufacturing of a product to be ultimately sold at retail.
Nothing in this section creates a private right of action in any civil litigation.
Notwithstanding the authority’s ability to delegate power to the executive director pursuant to subdivision (a) of Section 185024, a contract change order with a value greater than one hundred million dollars ($100,000,000) shall be approved by the authority.
For purposes of this section, “Merced to Bakersfield segment” has the same meaning as defined in Section 185033.7.
Before submitting a federal grant application for funding for implementation of the high-speed rail project, the authority shall notify the chairpersons of the relevant committees of both houses of the Legislature of the authority’s intent to apply for federal funding. This notification shall include, but not is limited to, all of the following information:
Amount of federal funding for which the authority is applying.
Activities for which the funding will be used, including whether the planned activities are located on the Merced to Bakersfield segment.
The expected source and level of state matching funding required for a successful grant application.
If there is expected matching state funding that would be spent outside the Merced to Bakersfield segment, the notification shall include an explanation of the need for the proposed spending and how it is consistent with the Legislature’s stated goal of prioritizing the construction of the Merced to Bakersfield segment, as described in Section 1 of the act adding this section.
Track and systems.
Leasing or procurement of train sets.
Any work with an estimated value of over two hundred fifty million dollars ($250,000,000) or a duration of 10 years or more.
Expected value and duration of the contract.
Activities for which the authority will be contracting.
How the proposed contract is consistent with the Legislature’s stated goal of prioritizing the completion of the Merced to Bakersfield segment, as described in Section 1 of the act adding this section.
Notwithstanding any other provision of law, for any project along the high-speed rail network, the authority may contract with the department to perform project design and engineering services, including construction inspection services.
For purposes of this section, “project design and engineering services, including construction inspection services” means preliminary engineering, planning, prebid services, right-of-way acquisition, preparation of environmental documents, preparation of plans, specifications, and estimates, construction inspection including surveying and materials testing, quality control inspection including highway and utility relocation, and grade separations.
Any legal or equitable action brought against the authority shall be brought in a court of competent jurisdiction in the County of Sacramento. For purposes of this section, subdivision (1) of Section 401 of the Code of Civil Procedure does not apply.
CHAPTER 4. Rights-of-Way [185040. - 185045.]
If the authority determines that real property or an interest therein, previously or hereafter acquired by the state for high-speed rail purposes, is no longer necessary for those purposes, the authority may sell or exchange the real property or interest therein at fair market value in the manner set forth in this section.
Before selling the real property or interest therein in any manner authorized under this section, the authority shall send notification by certified mail to the last known owner of the real property or interest therein at his or her last known address, advising him or her that the real property or interest therein will be offered for sale. The authority shall not sell the real property or interest therein until at least 30 days after the notification has been sent.
The authority may sell the property to an adjoining landowner if it makes either of the following findings:
That the property is of a size or shape that it is below the average normal standard size and shape of other privately owned properties in the immediate neighborhood, and that if the property were sold to other than the adjoining owner, it would give rise to a land use development thereof that would be below and not consistent with the normal land use of other properties in that neighborhood, (B) that the sale of the property to a party other than the adjoining owner may cause an undue or unfair hardship to the adjoining owner in the normal land use development or operation of his or her property, (C) that the property considered as part of the adjoining property would have a higher and better use than under separate ownership, and (D) that the fair market value of the property considered as part of the adjoining property would be higher than under separate ownership.
That the sale of the excess parcel to other than the adjoining owner would deprive the adjoining owner of an existing vested right of access to a public highway and thereby create a possible cause of action against the authority or the state.
A sale to an adjoining landowner pursuant to this subdivision may be by contract to sell or trust deed. The payment period in a contract of sale or sale by trust deed shall not extend longer than 10 years from the time the contract of sale or trust deed is executed, and a transaction involving a contract of sale or sale by trust deed to private parties shall require a downpayment of at least 30 percent of the purchase price.
The authority may sell the property to municipalities or other local agencies at their request, without calling for competitive bids, at a price representing the fair market value thereof, and upon a determination that the intended use is for a public purpose.
If it is improved property, the property may be sold to a former owner who has remained in occupancy or to a residential tenant of a tenure of five years or more with all rent obligations current or paid in full.
Any real property or interest therein may in like manner be exchanged, either as whole or part consideration, for any other real property or interest therein as needed for high-speed rail purposes. This provision does not authorize exchanges where the value of the state-owned property exceeds the value of the property the authority seeks to acquire, unless the excess value is incidental and subdivision of the state-owned property, in order to produce a smaller parcel of equal value to the value of the property the authority seeks to acquire, would reduce the total value of the state-owned property.
Except as otherwise provided in this section, property shall be sold either by receipt of competitive sealed bids or at public auction, whichever method is determined by the authority to be more likely to achieve the higher sales price.
Any payments received under this section for the sale of real property no longer necessary for high-speed rail purposes shall be deposited in the High-Speed Rail Property Fund created pursuant to Section 185045 and shall be available to the authority upon appropriation as provided in that section.
The authority may sell or lease excess right-of-way parcels to municipalities or other local agencies for public purposes, and may accept as all or part of the consideration for the sale or lease any substantial benefits the state will derive from the municipality or other local agency’s undertaking maintenance or landscaping costs that would otherwise be the obligation of the state.
The authority may lease nonoperating right-of-way areas to municipalities or other local agencies for public purposes, and may contribute toward the cost of developing local parks and other recreational facilities on those areas. The authority may accept as all or part of the consideration for the lease or for the state contribution any substantial benefits the state will derive from the municipality or other local agency’s undertaking maintenance or landscaping costs that would otherwise be the obligation of the state. Those leases shall contain a provision that whenever the leased land is needed for high-speed rail operating purposes the lease shall terminate. The authority is authorized to classify portions of high-speed rail rights-of-way as nonoperating.
The authority may lease to public agencies or private entities or individuals for any term not to exceed 99 years the use of areas above or below operating rights-of-way and portions of property not currently being used as operating rights-of-way, subject to any reservations, restrictions, and conditions that it deems necessary to ensure adequate protection of the safety and adequacy of high-speed rail facilities and of abutting or adjacent land uses. Prior to entering into any lease, the authority shall determine that the proposed use is not in conflict with the zoning regulations of the local government concerned. The leases shall be made in accordance with procedures to be prescribed by the authority, except that, in the cases of leases with private entities or individuals, the leases shall be made only after competitive bidding. The possibilities of entering into the leases, and the consequent benefits to be derived therefrom, may be considered by the authority in designing and constructing the high-speed rail system. Revenues from the leases shall be deposited in the High-Speed Rail Property Fund created pursuant to Section 185045.
The High-Speed Rail Property Fund is hereby created in the State Treasury for the deposit of revenue received from the sale, lease, or grant of any interest in or use of real property owned or managed by the High-Speed Rail Authority. Revenues in the fund shall be available to the authority, upon appropriation by the Legislature, for use in the development, improvement, and maintenance of the high-speed rail system, consistent with appropriate uses for each funding source.
CHAPTER 5. Relocation of Utilities [185500. - 185511.]
“High-speed rail property” means real property or an interest therein, including any right-of-way, previously or hereafter acquired by the state for high-speed rail purposes.
“Person” means a natural person, firm, partnership, association, corporation, organization, limited liability company, or business trust, and includes any city, county, city and county, public corporation, or public district.
“Utility” means any person maintaining a utility facility.
“Utility facility” means any pole, pole line, pipe, pipeline, conduit, cable, aqueduct, or other structure or appurtenance thereof used for publicly or privately owned utility services or used by any mutual organization supplying water or telephone service to its members.
When the authority requires any utility to remove any utility facility lawfully maintained in the right-of-way of any high-speed rail property to a location entirely outside the high-speed rail property right-of-way, the authority shall pay the reasonable and necessary cost of the removal. This includes both the cost of removal and the cost of relocation to a new location outside of the high-speed rail property right-of-way.
This section does not apply to the relocation of a utility facility from one point in a high-speed rail property to another point in that property, including relocation in any service road of the high-speed rail property or from one point of crossing of the high-speed rail property to another reasonable point of crossing.
When the authority requires a publicly owned utility to relocate within a high-speed rail property any utility facility lawfully maintained in that property that was not used for high-speed rail purposes at the time the utility facility was originally installed, the authority shall pay the cost of the relocation.
When the authority requires a privately owned utility to relocate within a high-speed rail property any utility facility used solely to supply water, which facility is lawfully maintained in any high-speed rail property that was not used for high-speed rail purposes at the time that the utility facility was originally installed, the authority shall pay the cost of the relocation.
When the authority requires a privately owned utility to relocate within a high-speed rail property any utility facility, other than one used solely to supply water, which facility is lawfully maintained in any high-speed rail property that was not used for high-speed rail purposes at the time the utility facility was originally installed, and it is established by the utility that the utility is not under express contractual obligation to relocate the utility facility at its own expense, the authority shall pay the cost of the relocation.
A permit containing a contractual obligation that was accepted by the utility for maintenance or minor improvement of the facility after the property became high-speed rail property shall not constitute a contractual obligation to relocate a utility facility at its own expense within the meaning of this section.
Publicly owned sewers and fire hydrants and any street lighting structure, whether publicly or privately owned, in any high-speed rail property shall be relocated, where necessary, at the expense of the authority.
If the authority requires the relocation within the right-of-way of any utility facility more than once within a period of 10 years, the authority shall pay the cost of the second relocation and any subsequent relocation within the 10-year period.
In any case in which the authority is required under the provisions of this chapter to pay the cost of removal or relocation of any utility facility, it shall be entitled to the following credits:
In the amount of any betterment to the utility facility resulting from the removal or relocation, not in excess of the cost of the increased capacity of the facility.
The salvage value of any materials or parts salvaged and retained by the utility.
If a new utility facility or portion of that facility is constructed to accomplish the removal or relocation, an allowance of an amount equal to the same proportion of the original cost of the displaced utility facility or portion of that facility as the age of the facility bears to the normal expected life of the facility.
A credit shall not be allowed against any portion of the cost that is otherwise chargeable to the utility.
A credit allowance for age shall not be applied to publicly owned sewers.
The authority and any utility required to remove a utility facility or to relocate any utility facility may, by agreement, provide for the respective amounts of the cost to be borne by each. The authority may, without prejudice to its rights under Section 185506, advance the cost of removal or relocation, and, if the authority advances that cost, it is the duty of the utility to move its facilities as soon as reasonably possible so as not to delay high-speed rail construction. In the case of any utility that is not financially able to bear the costs of removal or relocation, the authority may by agreement provide for the work to be done on condition that the utility’s portion of the costs be repaid to the authority over a period of time not exceeding 10 years.
Either party may maintain an action in a court of competent jurisdiction for an adjudication as to the obligations and costs to be borne by each party under any contract entered into by the parties at any time within four years after the cause of action first arose. The cause of action shall be deemed to arise at the time of the completion by the utility of the removal or relocation in question, or at the time of a breach of the agreement by either party, whichever occurs first. The filing of a claim with a state agency shall not be deemed a condition precedent to the maintenance by the utility of an action under this subdivision.
In the event of failure to reach an agreement as provided in Section 185505, the utility or the authority may bring an action in a court of competent jurisdiction for apportionment of the cost between them in accordance with this chapter. This action shall be commenced within three years of the date of completion by the utility of the removal or relocation in question. The filing of a claim with a state agency shall not be deemed a condition precedent to the maintenance by the utility of an action pursuant to this section.
The authority and any utility as defined in Section 185500 may enter into a contract providing for or apportioning the obligations and costs to be borne by each party as to either or both of the following subject matters:
Any or all removals or relocations of utility facilities completed by the utility prior to the effective date of the contract as required by notice given by the authority when necessary to accommodate any or all state high-speed rail construction, where: (A) the obligations or costs to be borne by each party for a removal or relocation are in dispute; and (B) the claim of the utility is: (i) founded upon a removal or relocation completed by the utility not earlier than three years preceding the effective date of the contract; or (ii) involved in an action pending in a court of competent jurisdiction if the action was commenced within three years after completion by the utility of the removal or relocation in question.
Any or all removals or relocations of utility facilities to be undertaken or completed by the utility after the effective date of the contract as required by notice given by the authority when necessary to accommodate any or all state high-speed rail construction.
Those provisions of a contract authorized in paragraph (1) of subdivision (a) settling the claims of the parties in respect to removals or relocations of utility facilities completed by the utility prior to the effective date of the contract shall be irrevocable after the execution of the contract, unless changed or modified by mutual consent of the parties in writing. Either party may maintain an action in a court of competent jurisdiction upon any of the provisions of the contract at any time within two years after the effective date of the contract, and the utility need not file a claim with a state agency as a condition precedent to the maintenance of an action under this subdivision.
Those provisions of a contract dealing with removals or relocations of utility facilities to be undertaken or completed by the utility after the effective date of the contract, as authorized in paragraph (2) of subdivision (a), shall be subject to the following limitations and requirements:
While the contract remains in effect, the contract shall govern exclusively the determination of the obligations and costs to be borne by each party in regard to any removal or relocation covered by the contract and undertaken or completed by the utility after the effective date of the contract, whether notice of the necessity of the removal or relocation was given by the authority to the utility before or after the effective date of the contract. This chapter, as now or hereafter existing, and any and all other laws that would be applicable to the subject matter but for the contract shall not apply, except that laws may be referred to, retained, and made applicable by the contract. This paragraph shall not apply in the following circumstances:
If, before the effective date of a contract entered into under this section, the parties executed an agreement in respect to the obligations and costs to be borne by each party as to a particular removal or relocation under a notice given by the authority, the provisions of such an agreement shall govern as to the obligations and costs to be borne by each party in respect to that particular removal or relocation.
If a particular notice given by the authority before the effective date of a contract entered into under this section includes a determination that a removal or relocation is to be made at the expense of the utility, the utility shall be bound by that notice unless the utility advised the authority in writing of its disagreement with the determination within the time specified in an agreement then in effect between the authority and the utility in respect to the procedure to be followed in those cases, or, if there is no such agreement, within a reasonable time after receipt by the utility of the notice.
Either party may maintain an action in a court of competent jurisdiction for an adjudication as to the obligations and costs to be borne by each party under the contract at any time within four years after the cause of action first arose. The cause of action shall be deemed to arise at the time of the completion by the utility of the removal or relocation in question. The filing of a claim with a state agency shall not be deemed a condition precedent to the maintenance by the utility of an action under this paragraph.
The contract shall terminate upon the repeal of this section, the repeal of paragraph (2) of subdivision (a) and subdivision (c), or at the time or in the manner as may be provided in the contract. In the event of termination under this paragraph, the laws applicable to the subject matter of the contract existing at the time of termination shall thereafter govern, except that the terms of the contract shall continue to apply to removals or relocations required of the utility by the authority under notice mailed or delivered to the utility prior to the termination, whether work upon the removal or relocation has already commenced, is in progress, or has been completed.
A utility is entitled to a permit for such reasonable crossings of high-speed rail property as may be required for the proper discharge of the utility’s service to the public.
The authority shall exercise reasonable discretion in acting on applications of utilities for permits to occupy high-speed rail property for longitudinal locations of facilities, as may be required for the proper discharge of their services to the public. The authority may, however, refuse to grant an application for a longitudinal installation that would be inconsistent with public safety or the continued unobstructed use of the high-speed rail property for rail or vehicular traffic, or for any type of utility structure inconsistent with the aesthetic values of any landscaped high-speed rail property within, or approaching within, one mile of the limits of any city.
The authority, in acting upon applications for utility permits, shall consider both the interests of the traveling public upon the high-speed rail property and the needs of consumers for utility services.
Nothing in this chapter is intended to prevent the authority from making reasonable rules and regulations and requiring reasonable conditions in permits concerning the place, manner, and method of location of utility facilities in, under, over, or along high-speed rail property.
DIVISION 19.7. High-Speed Rail Authority Office of the Inspector General [187000. - 187038.]
CHAPTER 1. General Provisions and Definitions [187000. - 187010.]
The Legislature finds and declares that ensuring that information available to make fiscally responsible decisions about the project is accurate, current, and impartial is critical to better ensuring the success of the project and to meet the expectations of the state’s taxpayers and the intent of the Safe, Reliable High-Speed Passenger Train Bond Act for the 21st Century (Chapter 20 (commencing with Section 2704) of Division 3 of the Streets and Highways Code).
In establishing this division, it is the intent of the Legislature to provide decisionmakers with impartial information about how to proceed with the project.
Unless the context requires otherwise, for purposes of this division, the following definitions apply:
“Inspector General” means the High-Speed Rail Authority Inspector General appointed pursuant to Section 187020.
“Merced to Bakersfield segment” means a 171-mile electrified dual-track segment that is usable for high-speed rail service in the central valley from Merced to Bakersfield, with a new combined station in downtown Merced, and connections to the Amtrak San Joaquins and the Altamont Corridor Express.
“Office” means the High-Speed Rail Authority Office of the Inspector General established pursuant to Section 187020.
“Personnel issues” means matters specific to the employment relationship between the High-Speed Rail Authority and its employees, including, but not limited to, hiring and promotional decisions, performance reviews, progressive discipline, adverse actions, grievances, merit issue complaints, workplace harassment, discrimination, or possible wage or supply theft having an immaterial effect, as determined by the Inspector General, on the planning, delivery, and operation of the project. For purposes of this division, “personnel issues” does not mean fraud, waste, abuse, or mismanagement by the High-Speed Rail Authority or its employees having a material effect, as determined by the Inspector General, on the planning, delivery, and operation of the project.
“Project” means the high-speed rail project undertaken by the High-Speed Rail Authority pursuant to Division 19 (commencing with Section 185000) of this code and Chapter 20 (commencing with Section 2704) and Chapter 20.5 (commencing with Section 2704.75) of Division 3 of the Streets and Highways Code.
CHAPTER 2. The High-Speed Rail Authority Office of Inspector General [187020. - 187024.]
There is hereby created the High-Speed Rail Authority Office of the Inspector General.
The Governor shall appoint the High-Speed Rail Authority Inspector General to a four-year term from a list of three qualified individuals nominated by the Joint Legislative Audit Committee. The Joint Legislative Audit Committee shall select the three qualified individuals from a pool of candidates after conducting a comprehensive search for qualified individuals. The Joint Legislative Audit Committee shall provide at least 120 days’ notice that it is seeking applicants for nomination by providing notice in the Journals of the Senate and the Assembly and by advertising in appropriate newspapers and with nationally acknowledged professional journals and associations. Names for consideration by the Joint Legislative Audit Committee may be submitted by members of the Legislature, professional organizations, individuals, and other entities. The Inspector General shall be chosen without reference to party affiliation and solely on the ground of fitness to perform the duties of the High-Speed Rail Authority Inspector General.
The Legislature and the Governor may provide suggested qualifications to the Joint Legislative Audit Committee to consider when making its nominations.
The Office of the Inspector General shall not be a subdivision of any other governmental entity.
The Inspector General may not be removed from office by the Governor during that term, except for good cause.
In coordination with the High-Speed Rail Authority, the Inspector General shall be provided with appropriate and adequate office space at the High-Speed Rail Authority’s offices or other facilities as necessary, together with such equipment, office supplies, maintenance services, and communications facilities and services as may be necessary for the operation of the Inspector General’s offices.
For each fiscal year, the Inspector General shall provide the Department of Finance with the office’s proposed budget by September 1 of each year. If the Department of Finance makes any position or funding changes to the Inspector General’s proposed budget, including, but not limited to, modifications related to total funding amounts in the budget year and out-years, staff classifications, limited-term versus permanent positions, contract resources, and operating expenses and equipment, the Department of Finance shall provide a notification to the chairs and vice chairs of the budget committees of both houses of the Legislature and the Legislative Analyst’s Office identifying the differences and explaining the reasons for the differences. This notification shall be provided no later than January 10 of each year.
The annual salary for the Inspector General shall be equal to that of the Inspector General of the Department of Corrections and Rehabilitation established pursuant to Chapter 8.2 (commencing with Section 6125) of Title 7 of Part 3 of the Penal Code.
Subject to applicable law, the Inspector General shall select, appoint, and employ officers and employees necessary to carry out the functions of the office. In making these selections, the Inspector General shall ensure that those officers and employees have the requisite training and experience to enable the Inspector General to carry out their duties effectively.
CHAPTER 3. Responsibilities of the High-Speed Rail Authority Inspector General [187030. - 187038.]
The Inspector General may, under policies developed by the Inspector General, initiate an audit or review on the Inspector General’s own accord regarding oversight related to delivery of the project, and the selection and oversight of contractors related to the project. Following a completed audit or review, the Inspector General may perform a followup audit or review to determine what measures the High-Speed Rail Authority implemented to address the Inspector General’s findings and to assess the effectiveness of those measures. In considering what audits and reviews to perform, the Inspector General may consider input received from the Legislature, the Governor, and the High-Speed Rail Authority.
The duties and responsibilities of the Inspector General shall include, but are not limited to, all of the following:
Commencing with the project update report required pursuant to Section 185033.5 that is due on or before March 1, 2023, to conduct independent fiscal estimates and reviews of the High-Speed Rail Authority’s plans and estimates for project advancement and make findings of the reasonableness of those plans and estimates.
Commencing with the project update report required pursuant to Section 185033.5 that is due on or before March 1, 2023, to monitor progress toward meeting the milestones toward the implementation of the successful completion of the Merced to Bakersfield segment of the project, consistent with subdivision (a).
To conduct audits and investigations relating to delivery of the project.
To identify best practices in the delivery of capital projects and recommend policies to enable the High-Speed Rail Authority to adopt these practices when practicable.
To recommend policies promoting efficiency in the administration of programs and operations as part of any audit findings.
To review the High-Speed Rail Authority process for considering proposed and executed change orders and to make any recommendations to ensure the process is appropriate for determining the merit and reasonableness of change orders.
To review the High-Speed Rail Authority’s contracts and contracting practices to determine whether they are executed consistent with state and federal laws and policies and are conducted in a fair and reasonable manner, providing the state with valued services at reasonable cost.
To review proposed agreements to ensure that they are in the best interest of the state, the High-Speed Rail Authority’s statutory mission, and state priorities.
To review or investigate adherence to contract provisions, including, but not limited to, billing and invoicing requirements, of any public or private entity, including a High-Speed Rail Authority contractor, that receives project funds.
The Inspector General shall not investigate personnel issues regarding employees of the High-Speed Rail Authority.
Nothing in this division is intended to infringe upon the authority of the High-Speed Rail Authority’s own audits and controls.
In connection with duties authorized pursuant to this division, the Office of the Inspector General may do any of the following:
Administer oaths.
Certify to all official acts.
Receive and investigate complaints or information from any person concerning the existence of an activity constituting a violation of laws, rules, or regulations, or mismanagement, gross waste of funds, abuse of authority, or a substantial and specific danger to the public health and safety. Once a complaint or information has been received from an employee of the High-Speed Rail Authority or one of its contractors:
The Inspector General shall not disclose the identity of the employee without the consent of the employee, unless the Inspector General determines that the disclosure is unavoidable during the course of the investigation or the disclosure is made to an official of the Department of Justice responsible for determining whether a prosecution should be undertaken.
No action constituting a reprisal, or threat of reprisal, for making the complaint or providing the information may be taken by any employee of the High-Speed Rail Authority or one of its contractors in a position to take those actions, unless the complaint was made or the information was disclosed with the knowledge that it was false or with willful disregard for its truth or falsity.
Issue subpoenas for the attendance of witnesses and the production of papers, books, accounts, or documents in any medium, or for the making of oral or written sworn statements, in any interview conducted pursuant to duties authorized by this division.
Any subpoena issued under this division extends as process to all parts of the state and may be served by any person authorized to serve process of courts of record or by any person designated for that purpose by the office. The person serving this process may receive compensation as is allowed by the office, not to exceed the fees prescribed by law for similar service.
Notwithstanding any other law, the Inspector General during regular business hours or at any other time determined necessary by the Inspector General shall have access to and authority to examine and reproduce any and all books, accounts, reports, vouchers, correspondence, files, documents, and other records, and to examine the bank accounts, moneys, or other property of the High-Speed Rail Authority in connection with duties authorized by this division. Any officer or employee of any agency or entity having these records or property in their possession or under their control shall permit access to, and examination and reproduction thereof consistent with the provisions of this division, upon the request of the Inspector General or the Inspector General’s authorized representative.
The High-Speed Rail Authority shall ensure that the right-of-access provisions described in subdivision (a) are included in all of its contracts or amendments executed on or after July 1, 2024, in which project funds will be expended.
Providing confidential information to the Inspector General pursuant to this section, including, but not limited to, confidential information that is subject to a privilege, shall not constitute a waiver of that confidentiality.
The Inspector General shall not destroy any papers or memoranda used to support a completed audit or review sooner than three years after the corresponding report is published or delivered pursuant to Section 187037.
All books, papers, records, and correspondence of the office pertaining to its work are public records subject to Division 10 (commencing with Section 7920.000) of Title 1 of the Government Code and shall be filed at any of the regularly maintained offices of the Inspector General, except that none of the following items or papers of which these items are a part shall be released to the public by the Inspector General or the employees of the Inspector General:
Personal papers and correspondence of any person providing assistance to the Inspector General for purposes of paragraph (3) of subdivision (a) of Section 187032 when that person has requested in writing that their papers and correspondence be kept private and confidential. Consistent with subparagraph (A) of paragraph (3) of subdivision (a) of Section 187032, those papers and correspondence shall become public records if the written request is withdrawn, or upon the order of the Inspector General.
Papers, correspondence, memoranda, or any substantive information pertaining to any audit or review not completed.
Papers, correspondence, or memoranda pertaining to any audit or review that has been completed, which papers, correspondence, or memoranda are not used in support of any report resulting from the audit or review.
Any survey of public employees or contracted staff that the Inspector General determines should be kept confidential to deter retaliation if the employees or staff respond to the survey.
Any record of an investigation conducted under this division, including, but not limited to, all investigative files and work product, except that the Inspector General, whenever the Inspector General determines it necessary to serve the interests of the state, may issue a public report of the results of an investigation that has substantiated a violation of laws, rules, or regulations, or mismanagement, gross waste of funds, abuse of authority, or a substantial and specific danger to the public health and safety. Except as provided in subparagraph (A) of paragraph (3) of subdivision (a) of Section 187032, the Inspector General may also release any findings or evidence supporting any findings resulting from an investigation conducted pursuant to this division whenever the Inspector General determines it necessary to serve the interests of the state.
The restrictions on public disclosure described in subdivision (b) shall only apply to records in the possession or control of the Inspector General, and shall not alter the responsibility of any other state or local agency to comply with all applicable laws regarding the disclosure of public records.
It is a misdemeanor for the Inspector General or any employee or former employee of the Inspector General to divulge or make known in any manner not expressly permitted by law to any person not employed by the Inspector General any particulars of any record, document, or information the disclosure of which is restricted by law from release to the public. This prohibition is also applicable to any person who has been furnished a draft copy of any report for comment or review or any person or business entity that is contracting with or has contracted with the Inspector General and to the employees and former employees of that person or business entity or the employees of any state agency or public entity that has assisted the Inspector General in connection with duties authorized by this division.
Except as provided in subdivision (b), upon completion of an audit or review conducted pursuant to subdivision (a) of Section 187030, the Inspector General shall do all of the following:
Publish a complete report on its internet website.
Provide, in compliance with policies developed by the Inspector General, notification of the published report to the Governor and the High-Speed Rail Authority.
Submit a copy of the published report to the Legislature in compliance with Section 9795 of the Government Code.
The Inspector General may hold a report, or a portion of a report, confidential for the period of time described in paragraph (3) if the Inspector General determines that the report, or a portion of the report, would describe or otherwise reveal weaknesses, including those involving information security, physical security, fraud detection controls, or pending litigation, that would pose a substantial and articulable risk to the project or to state operations if publicly disclosed.
If the Inspector General makes a determination pursuant to paragraph (1), the Inspector General shall do all of the following:
Make publicly available any reasonably segregable portion of the report that does not pose the substantial and articulable risk identified pursuant to paragraph (1).
Publicly disclose that a report, or a portion of the report, has been held confidential and provide the rationale for the determination.
Deliver a confidential report, or a confidential portion of the report, that describes and makes recommendations to resolve the identified weaknesses to state officials with oversight of the project, which may include the executive director and board chair of the High-Speed Rail Authority, the chairs of the Assembly Committee on Transportation and the Senate Committee on Transportation, or the Governor. The report, or portion of the report, delivered pursuant to this subparagraph shall remain confidential only so long as the Inspector General determines that public disclosure would continue to pose the substantial and articulable risk identified pursuant to paragraph (1).
Within 120 days after making a determination pursuant to paragraph (1), and at least every 120 days thereafter while a report, or a portion of a report, is held confidential, the Inspector General shall reassess whether continued confidentiality is warranted. Upon each reassessment, the Inspector General shall either publicly release the report, or the portion of the report, that is held confidential or issue a written determination explaining why continued confidentiality remains necessary.
The Inspector General shall report at least annually to the Legislature and the Governor a summary of its findings, positive and negative, of any reviews, investigations, or audits published pursuant to Section 187037 at the beginning of each fiscal year and upon request of the Legislature or Governor. The summary shall be posted on the office’s internet website and otherwise made available to the public upon its release to the Legislature and the Governor. The summary shall include, but not be limited to, significant problems discovered by the office, and whether previous recommendations the office has made have been implemented.
The Inspector General shall report annually to the Legislature and the Governor on findings related to the High-Speed Rail Authority’s planning and delivery of the project. This report shall include updates on the High-Speed Rail Authority’s efforts to remedy any identified findings, and whether any identified findings have been addressed.
The Inspector General shall maintain a list of identified findings, and the status of the High-Speed Rail Authority’s efforts to address them, and shall post that list on the office’s internet website.
Reports to be submitted to the Legislature pursuant to subdivisions (a) and (b) shall be submitted in compliance with Section 9795 of the Government Code.
DIVISION 25. RIVERSIDE COUNTY TRANSPORTATION COMMISSION [240000. - 240323.]
CHAPTER 1. General Provisions, Findings, and Definitions [240000. - 240004.]
The division shall be known and may be cited as the Riverside County Transportation Sales Tax Act.
The Legislature hereby finds and declares all of the following:
Recognizing the scarcity of resources available for all transportation development, alternative methods of financing provided in this division are needed to finance the cost of constructing, developing, acquiring, and maintaining and providing highways, streets, roads, and public transportation services in the County of Riverside and these methods will increase economic opportunities, contribute to economic development, be in the public interest and serve a public purpose, and promote the health, safety, and welfare of the citizens within the County of Riverside.
It is the intent of the Legislature, in enacting this division, that the County of Riverside continue to receive its equitable share of funds under the state transportation improvement program and that incentives be provided to reward rather than to penalize counties that adopt local sales tax measures.
It is in the public interest to allow the voters of Riverside County to adopt a specific revenue source and to authorize new duties for the Riverside County Transportation Commission so that local decisions can be implemented in a timely manner to provide improvements to the transportation system.
“Bonds” means indebtedness and securities of any kind or class, including bonds, notes, bond anticipation notes, and commercial paper.
“Commission” means the Riverside County Transportation Commission created pursuant to Section 130054.
“County” means the County of Riverside.
CHAPTER 2. Administration [240100. - 240103.]
The commission shall expend only that amount of the funds generated pursuant to this division for staff support, audit, administrative expenses, and contract services that are necessary and reasonable to carry out its responsibilities pursuant to this division. The commission shall not expend more than 1 percent of the funds received from the transactions and use tax levied pursuant to Chapter 4 (commencing with Section 240300) for the salaries and benefits for the commission’s staff.
The commission shall do all of the following with respect to the revenues derived from the transactions and use tax levied pursuant to Chapter 4 (commencing with Section 240300):
Adopt an annual budget.
Cause a postaudit of the financial transactions and records of the commission and of all revenues expended pursuant to this division to be made at least annually by a certified public accountant.
Do any and all things necessary to carry out the purposes of this division.
The commission shall publish, pursuant to Section 6061 of the Government Code, notice of the time and place of the public hearing for the adoption of the annual budget not later than 15 days prior to the date of the hearing.
The proposed annual budget shall be available for public inspection at least 15 days prior to the hearing.
The commission may approve a transaction and use tax ordinance and ballot proposition and call an election in accordance with Chapter 4 (commencing with Section 240300).
CHAPTER 3. Powers and Functions [240200. - 240203.]
The commission may sue and be sued, except as otherwise provided by law, in all actions and proceedings, in all courts and tribunals of competent jurisdiction.
All claims for money or damages against the commission are governed by Division 3.6 (commencing with Section 810) of Title 1 of the Government Code except as provided therein, or by other statutes or regulations expressly applicable thereto.
The commission may make contracts and enter into stipulations of any nature whatsoever, including, but not limited to, contracts and stipulations to indemnify and hold harmless, to employ labor, and to do all acts necessary and convenient for the full exercise of the powers granted in this division.
The commission may contract with any department or agency of the United States of America, with any public agency, including, but not limited to, the Department of Transportation, any transit development board, county, or city, or with any person upon any terms and conditions that the commission finds is in its best interest.
CHAPTER 4. Transactions and Use Tax [240300. - 240323.]
The Legislature, by the enactment of this chapter, intends the additional funds provided government agencies by this chapter to supplement existing local revenues being used for transportation purposes. The government agencies shall maintain their existing commitment of local funds for street, highway, and public transit purposes pursuant to an ordinance adopted by the commission to enforce this section.
The commission may levy a retail transactions and use tax applicable in the incorporated and unincorporated territory of the county in accordance with this chapter and Part 1.6 (commencing with Section 7251) of Division 2 of the Revenue and Taxation Code. The ordinance shall only become effective if adopted by a two-thirds vote of the commission and subsequently approved by two-thirds of the electors voting on the measure at a special election called for the purpose by the board of supervisors or at any regular election. The commission shall specify in the ordinance that not more than 1 percent of the annual net amount of revenues raised by the tax may be used to fund the salaries and benefits of the staff of the commission in administering the programs funded from that tax. The ordinance shall take effect at the close of the polls on the day of election at which the proposition is adopted. The initial collection of the transactions and use tax shall take place in accordance with Section 240304.
If the voters do not approve the ordinance, the board of supervisors may, at any time thereafter, submit the same, or a different, measure, if adopted by a two-thirds vote of the commission, to the voters in accordance with this division.
The commission, in the ordinance, shall state the nature of the tax to be imposed, the tax rate or the maximum tax rate, the purposes for which the revenue derived from the tax will be used, and shall set a term during which the tax will be imposed.
The purposes for which the tax revenues may be used may include, but are not limited to, the administration of this division, including legal actions related thereto, the construction, capital acquisition, maintenance, and operation of streets, roads, highways, including state highways, and public transit systems. These purposes include expenditures for the planning, environmental reviews, engineering and design costs, and related right-of-way acquisition.
The ordinance shall contain an expenditure plan which shall include the allocation of revenues for the purposes authorized by this section and shall include, at a minimum, the following provisions:
The proportional distribution of the revenues among various purposes.
The specific projects to be funded under the state highway and freeway portion.
The formula for distribution of the city and county portion, which may be amended by voter approval.
Following adoption of the ordinance by the voters, the expenditure plan may only be amended, if required, by the following process:
The county shall conduct an election called by the board of supervisors pursuant to Section 240301.
The election shall be called and conducted in the same manner as provided by law for the conduct of elections by a county.
Any transactions and use tax ordinance adopted pursuant to this chapter shall be operative on the first day of the first calendar quarter commencing more than 120 days after adoption of the ordinance.
Prior to the operative date of the ordinance, the commission shall contract with the State Board of Equalization to perform all functions incident to the administration and operation of the ordinance.
The revenues from the taxes imposed pursuant to this chapter shall be allocated by the commission for transportation purposes consistent with the adopted regional transportation improvement program and the regional transportation plan.
The commission, subject to the approval of the voters, may impose a maximum tax rate of 1.5 percent under this division and the Transactions and Use Tax Law (Part 1.6 (commencing with Section 7251) of Division 2 of the Revenue and Taxation Code). The commission shall only levy a tax or multiple taxes at a rate that is a multiple of 0.25 percent, unless a different rate is specifically authorized by statute. Neither this division nor the ordinance shall affect any tax otherwise authorized.
Notwithstanding Section 7251.1 of the Revenue and Taxation Code, the tax rate authorized pursuant to this section shall not be considered for purposes of the combined rate limit established by that section.
The tax rate adopted pursuant to this chapter, unless otherwise prohibited, may be increased by the commission by ordinance adopted in the manner and by the vote stated in Section 240301 and approved by two-thirds of the electors voting on the measure at an election called for that purpose by the commission.
Any increase or reduction in the tax rate adopted pursuant to Section 240306 or 240307 shall become effective on the first day of the calendar quarter which commences at least 120 days following the date of the commission’s vote approving the increased or reduced rate.
If requested to do so by the commission in its resolution calling for an election, the board of supervisors, as part of the ballot proposition to approve the imposition of a retail transactions and use tax, may seek authorization to issue bonds for capital outlay expenditures as may be provided for in the ordinance expenditure plan payable from the proceeds of the tax.
The maximum bonded indebtedness that may be outstanding at any one time shall be an amount equal to the sum of the principal of, and interest on, the bonds, but not to exceed the estimated proceeds of the tax, as determined by the plan. The amount of bonds outstanding at any one time does not include the amount of bonds, refunding bonds, or bond anticipation notes for which funds necessary for the payment thereof have been set aside for that purpose in a trust or escrow account.
The proposition shall set forth each of the following:
The actual percent of the tax.
The duration of the tax if the plan specifies a time limit.
The amount of bonds, if any, payable from the proceeds of the tax.
The commission as the agency imposing the tax.
The appropriations limit of the commission, pursuant to Section 4 of Article XIII B of the California Constitution.
The sample ballot to be mailed to the voters, pursuant to Section 13303 of the Elections Code, shall be the full proposition, as set forth in the ordinance calling the election, and the voter information handbook shall include the entire ordinance expenditure plan.
The bonds authorized by the voters concurrently with the approval of the retail transactions and use tax may be issued at any time by the commission and shall be payable from the proceeds of the tax. The bonds shall be referred to as “limited tax bonds.”
The bonds may be secured by a pledge of revenues from the proceeds of the tax.
The pledge of the tax to the limited tax bonds authorized under this chapter shall have priority over the use of any of the tax for “pay-as-you-go” financing, except to the extent that that priority is expressly restricted in the resolution authorizing the issuance of the bonds.
Limited tax bonds shall be issued pursuant to a resolution adopted at any time by a two-thirds vote of the commission. Each resolution shall provide for the issuance of bonds in the amounts as may be necessary, until the full amount of bonds authorized have been issued. The full amount of bonds may be divided into two or more series and different dates of payment fixed for the bonds of each series. A bond need not mature on its anniversary date.
A resolution authorizing the issuance of bonds shall state all of the following:
The purposes for which the proposed debt is to be incurred, which may include all costs and estimated costs incidental to, or connected with, the accomplishment of those purposes, including, without limitation, engineering, inspection, legal, fiscal agents, financial consultant and other fees, bond and other reserve funds, working capital, bond interest estimated to accrue during the construction period and for a period not to exceed three years thereafter, and expenses of all proceedings for the authorization, issuance, and sale of the bonds.
The estimated cost of accomplishing those purposes.
The amount of the principal of the indebtedness.
The maximum term the bonds proposed to be issued shall run before maturity, which shall not be beyond the date of termination of the imposition of the retail transactions and use tax.
The maximum rate of interest to be paid, which shall not exceed the maximum allowable by law.
The denomination or denominations of the bonds, which shall not be less than five thousand dollars ($5,000).
The form of the bonds, including, without limitation, registered bonds and coupon bonds, to the extent permitted by federal law, and the form of any coupons to be attached thereto, the registration, conversion, and exchange privileges, if any, pertaining thereto, and the time when all of, or any part of, the principal becomes due and payable.
The resolution may also contain any other matters authorized by this chapter or any other law.
The bonds shall bear interest at a rate or rates not exceeding the maximum allowable by law, payable at intervals determined by the commission, except that the first interest payable on the bonds, or any series thereof, may be for any period not exceeding one year, as determined by the commission.
In the resolution authorizing the issuance of the bonds, the commission may also provide for the call and redemption of the bonds prior to maturity at the times and prices and upon other terms as specified. However, no bond is subject to call or redemption prior to maturity, unless it contains a recital to that effect or unless a statement to that effect is printed.
The principal of, and interest on, the bonds shall be payable in lawful money of the United States at the office of the treasurer of the commission, or at other places as may be designated, or at both the office and other places at the option of the holders of the bonds.
The bonds, or each series thereof, shall be dated and numbered consecutively and shall be signed by the chairperson or vice chairperson of the commission and the auditor-controller of the commission, and the official seal, if any, of the commission shall be attached.
The interest coupons of the bonds shall be signed by the auditor-controller of the commission. All of the signatures and seal may be printed, lithographed, or mechanically reproduced.
If any officer whose signature appears on the bonds or coupons ceases to be that officer before the delivery of the bonds, the officer’s signature is as effective as if the officer had remained in office.
The bonds may be sold as the commission determines by resolution, and the bonds may be sold at a price below par, whether by negotiated or public sale.
Delivery of any bonds may be made at any place either inside or outside the state, and the purchase price may be received in cash or bank credits.
All accrued interest and premiums received on the sale of the bonds shall be placed in the fund to be used for the payment of the principal of, and interest on, the bonds, and the remainder of the proceeds of the bonds shall be placed in the treasury of the commission and applied to secure the bonds or for the purposes for which the debt was incurred. However, when the purposes have been accomplished, any money remaining shall be either (a) transferred to the fund to be used for the payment of principal of, and interest on, the bonds or (b) placed in a fund to be used for the purchase of the outstanding bonds in the open market at prices and in the manner, either at public or private sale or otherwise, as determined by the commission. Bonds so purchased shall be canceled immediately.
The commission may provide for the issuance, sale, or exchange of refunding bonds to redeem or retire any bonds issued by the commission upon the terms, at the times and in the manner which it determines.
Refunding bonds may be issued in a principal amount sufficient to pay all, or any part of, the principal of the outstanding bonds, the premiums, if any, due upon call and redemption thereof prior to maturity, all expenses of the refunding, and either of the following:
The interest upon the refunding bonds from the date of sale thereof to the date of payment of the bonds to be refunded out of the proceeds of the sale of the refunding bonds or to the date upon which the bonds to be refunded will be paid pursuant to call or agreement with the holders of the bonds.
The interest upon the bonds to be refunded from the date of sale of the refunding bonds to the date of payment of the bonds to be refunded or to the date upon which the bonds to be refunded will be paid pursuant to call or agreement with the holder of the bonds.
The provisions of this chapter for the issuance and sale of bonds apply to the issuance and sale of refunding bonds.
The commission may borrow money in anticipation of the sale of bonds which have been authorized pursuant to this chapter, but which have not been sold or delivered, and may issue negotiable bond anticipation notes therefor and may renew the bond anticipation notes from time to time. However, the maximum maturity of any bond anticipation notes, including the renewals thereof, shall not exceed five years from the date of delivery of the original bond anticipation notes.
The bond anticipation notes, and the interest thereon, may be paid from any money of the commission available therefor, including the revenues from the tax. If not previously otherwise paid, the bond anticipation notes, or any portion thereof, or the interest thereon, shall be paid from the proceeds of the next sale of the bonds of the commission in anticipation of which the notes were issued.
The bond anticipation notes shall not be issued in any amount in excess of the aggregate amount of the bonds which the commission has been authorized to issue, less the amount of any bonds of the authorized issue previously sold, and also less the amount of other bond anticipation notes therefor issued and then outstanding. The bond anticipation notes shall be issued and sold in the same manner as the bonds.
The bond anticipation notes and the resolutions authorizing them may contain any provisions, conditions, or limitations which a resolution of the commission may contain.
Any bonds issued under this chapter are legal investment for all trust funds; for the funds of insurance companies, commercial and savings banks, and trust companies; and for state school funds; and whenever any money or funds may, by any law now or hereafter enacted, be invested in bonds of cities, counties, school districts, or other districts within the state, that money or those funds may be invested in the bonds issued under this chapter, and whenever bonds of cities, counties, school districts, or other districts within the state may, by any law now or hereafter enacted, be used as security for the performance of any act or the deposit of any public money, the bonds issued under this chapter may be so used. The provisions of this chapter are in addition to all other laws relating to legal investments and shall be controlling as the latest expression of the Legislature with respect thereto.
Any action or proceeding wherein the validity of the adoption of the retail transactions and use tax ordinance provided for in this chapter or the issuance of any bonds thereunder or any of the proceedings in relation thereto is contested, questioned, or denied, shall be commenced within six months from the date of the election at which the ordinance is approved; otherwise, the bonds and all proceedings in relation thereto, including the adoption and approval of the ordinance, shall be held to be valid and in every respect legal and incontestable.
The commission has no power to impose any tax other than the transactions and use tax imposed upon approval of the voters in accordance with this division.