Bill Text: HI SB2648 | 2018 | Regular Session | Amended
Bill Title: Relating To The Public Utilities Commission.
Spectrum: Partisan Bill (Democrat 6-0)
Status: (Engrossed - Dead) 2018-03-16 - Passed Second Reading as amended in HD 1 and referred to the committee(s) on CPC with none voting aye with reservations; none voting no (0) and Representative(s) DeCoite, Fukumoto, Har, Holt, Nakashima, Souki, Tokioka excused (7). [SB2648 Detail]
Download: Hawaii-2018-SB2648-Amended.html
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THE SENATE |
S.B. NO. |
2648 |
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TWENTY-NINTH LEGISLATURE, 2018 |
S.D. 2 |
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STATE OF HAWAII |
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A BILL FOR AN ACT
RELATING TO THE PUBLIC UTILITIES COMMISSION.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:
SECTION 1. The legislature finds that the public utilities commission's primary purpose is to provide effective, proactive, and informed oversight of all regulated companies to ensure these companies efficiently and safely provide their customers with adequate and reliable services at just and reasonable rates, while providing regulated companies with a fair opportunity to earn a reasonable rate of return. However, the public utilities commission has several long- and short-term goals that reflect the commission's increased work complexity and program responsibilities, which go beyond the commission's traditional regulatory role, including in the area of energy regulation. Furthermore, with the advent of new and emerging technology, the market, and other forces, the regulatory landscape throughout the country is rapidly changing. However, the commission's current structure and operations have prevented it from quickly adapting to these changes.
The legislature further finds that, due to the commission's increasing responsibilities and the evolution of the regulatory landscape, it is essential that the structure and operations of the public utilities commission be updated to enable the commission to operate more efficiently and effectively, consistent with best practices. For example, updating the operations of the commission by adopting best practices ensures that the commission functions in a more inclusive and collaborative manner. Updating the structure of the commission will also be beneficial. Increasing the number of commissioners from three to five promotes diversity and is in line with the number of commissioners in many other jurisdictions. Furthermore, requiring the commission to be composed of women and men, at least one member from a neighbor island, and members from fields other than just the legal profession will enable the commission to consider a wider variety of backgrounds, perspectives, and expertise in its deliberations to better serve Hawaii's geographic and demographic diversity. The legislature notes that, in contrast to administrative agencies, commissions throughout the country are impaneled to provide for collective deliberation, as well as diversified perspective across geopolitical, demographic, professional, and other criteria. The legislature also notes that a diverse commission and staff can provide a stronger, more robust foundation for decision-making. A commission made up of individuals with diverse educational and geographic backgrounds and diverse representation of genders will have a broader range of knowledge, skills, and abilities than a more homogeneous commission. Commissioners from diverse backgrounds will provide greater access to a variety of relevant information, opinions, expertise, and perspectives, which will enhance deliberations and decision-making.
The legislature additionally finds that the public utilities commission and its commissioners must fill three equally essential and nonexclusive roles. In their quasi-administrative capacity, commissioners interpret policy and apply technical expertise to the routines of rulemaking, implementation, and enforcement. In their quasi-legislative capacity, commissioners craft policy and inform and support policymaking by other bodies. In their quasi-judicial capacity, commissioners must make findings and rulings in the context of particular cases, in accordance with established law and legal procedures. Commissioners serving on the public utilities commission therefore fill a unique role and, as such, have a responsibility to regulate in the public interest with the highest ethical standards. The legislature notes that this adherence to high ethical standards necessarily extends to commission staff but, in particular, the senior staff members of the commission, including its chief counsel, executive officer, chief of policy and research, and other staff who must engage in discussions with outside parties.
The legislature encourages the commission to engage in appropriate conversations with the consumer advocate and the State's regulated industries, even when there is no current case involved, which will enable the commission to gain a better understanding of the regulated industries. The legislature also encourages the commission to take steps toward a more collaborative working environment, such as more face-to-face meetings and by ensuring that research and analysis of cases and proposals of settlements are circulated amongst all commissioners to aid in the commissioners' deliberations of an issue.
In keeping with the idea of a more collaborative commission, the legislature also finds that advancements in technology have enabled people to participate and work remotely, without having to be physically present in the same location as their colleagues. Permitting the use of teleconference or videoconference technology for public hearings and briefings before the commission, or meetings with other commissioners and staff, will enable commissioners to participate in public hearings and commissioner or staff meetings in a convenient manner and be fully engaged.
The purpose of this Act is to update the structure and operation of the commission to increase efficiency and effectiveness by:
(1) Establishing guiding principles of the commission;
(2) Requiring the commission to establish a docket review and decision-making process that encourages collaboration;
(3) Allowing a commissioner to attend a public hearing or meeting, or work with staff, by teleconference or videoconference in specific situations;
(4) Requiring the executive officer, chief counsel, chief of policy and research, and any individual employed as or in the role of a hearings officer of the public utilities commission to annually file a disclosure of financial interests with the state ethics commission and requiring these disclosures to be public;
(5) Increasing the number of members on the commission, specifying the composition of commission members, and ensuring that members who are residents of a county other than the city and county of Honolulu receive per diem compensation and travel expenses;
(6) Requiring new commissioners to attend pertinent educational or training seminars within the first year of the commissioner's appointment and permitting commissioners and key staff to take advantage of relevant training opportunities;
(7) Clarifying the ability of the commissioners to appoint and employ staff;
(8) Clarifying the roles of the executive officer and chief counsel to the commission; and
(9) Requiring the commissioners to work with the department of commerce and consumer affairs and the department of human resources development to develop clearly defined duties and responsibilities for public utilities commission staff and report the staff duties to the legislature.
The legislature notes that, due to unforeseen circumstances, the auditor's report on the management audit of the public utilities commission, requested pursuant to Act 198, Session Laws of Hawaii 2017, has been delayed. The contents of the present Act shall be amended, as appropriate, once the auditor's report is released.
SECTION 2. Chapter 269, Hawaii Revised Statutes, is amended by adding three new sections to be appropriately designated and to read as follows:
"§269- Guiding
principles of the public utilities commission. The guiding principles of the public
utilities commission shall be to:
(1) Ensure
reliability and delivery of all essential services provided by regulated
entities at all times;
(2) Provide
oversight of resource planning efforts to ensure adequacy and resiliency to
ensure essential services are available when needed;
(3) Strive for
affordability for consumers, while also allowing regulated entities an
opportunity to maintain reasonable earnings;
(4) Align private
interest with public interest through the proactive, aggressive pursuit of
factual information and technical competency to result in fair and timely
decisions and orders in pursuit of the public interest;
(5) Regulate in the
public interest; and
(6) Encourage and
facilitate competition for the benefit of consumers.
§269- Commission; docket review;
decision-making; process. (a) The chairperson shall implement a docket
review and decision-making process that engages all commissioners in a
collegial, face-to-face manner, where commissioners shall have the opportunity
to review, discuss, and offer input to any order or decision and order
requiring a consensus of commissioners.
Commissioners shall work collaboratively to reach consensus on pending
matters in a timely fashion, utilizing, at a minimum, weekly meetings when necessary.
(b) To empower all commissioners to fully
participate in the work of the commission, any commissioner may call for a
meeting with the other commissioners for a deliberative discussion on any
docket or topic before the commission or likely to come before the
commission. Within twenty-four hours of
the request, the executive officer shall calendar a meeting. No commissioner shall refuse a meeting
request without reasonable justification, such as illness.
(c) A commissioner who discusses relevant
commission-related information at a meeting with an outside party shall inform
the other commissioners of the meeting.
(d) Once the commission is composed of five
commissioners who have been appointed and confirmed by the senate, the
commission may form panels of three commissioners to handle smaller dockets.
(e) Commissioners shall be guided by the public
interest principle of regulation.
§269- Hearing attendance by teleconference or
video conference. (a) A commissioner may attend a public hearing of
the public utilities commission, or a meeting scheduled by other commissioners,
by teleconference or videoconference to allow a commissioner residing on an
island other than Oahu to attend a public hearing of the commission, or a
meeting scheduled by other commissioners, held on Oahu and a commissioner
residing on the island of Oahu to attend a public hearing of the commission, or
a meeting scheduled by other commissioners, held on an island other than Oahu
by teleconference or videoconference; provided that commissioner participation
by teleconference or videoconference shall not be permitted at contested case
or evidentiary hearings.
(b) Each commissioner participating in a public
hearing by teleconference or videoconference shall be considered present at the
meeting for purposes of determining quorum and participating in all
proceedings.
(c) A public hearing held by teleconference or
videoconference:
(1) Need not have a
quorum present at any one location; and
(2) Is subject to
the notice requirements under section 269-12.
(d) The notice of each teleconference or
videoconference public hearing shall specify all physical locations from which the
commissioners will participate.
(e) Each commissioner may work with staff via
teleconference or videoconference on commission-related matters."
SECTION 3. Section 84-17, Hawaii Revised Statutes, is amended by amending subsections (c) and (d) to read as follows:
"(c) The following persons shall file annually with the state ethics commission a disclosure of financial interests:
(1) The governor, the lieutenant governor, the
members of the legislature, and delegates to the constitutional convention;
provided that delegates to the constitutional convention shall only be required
to file initial disclosures;
(2) The directors and their deputies, the division
chiefs, the executive directors and the executive secretaries and their
deputies, the purchasing agents and the fiscal officers, regardless of the
titles by which the foregoing persons are designated, of every state agency and
department;
(3) The permanent employees of the legislature and
its service agencies, other than persons employed in clerical, secretarial, or
similar positions;
(4) The administrative director of the State, and
the assistants in the office of the governor and the lieutenant governor, other
than persons employed in clerical, secretarial, or similar positions;
(5) The hearings officers of every state agency
and department;
(6) The president, the vice presidents, assistant
vice presidents, the chancellors, and the provosts of the University of Hawaii
and its community colleges;
(7) The superintendent, the deputy superintendent,
the assistant superintendents, the complex area superintendents, the state
librarian, and the deputy state librarian of the department of education;
(8) The administrative director and the deputy
director of the courts;
(9) The members of every state board or commission
whose original terms of office are for periods exceeding one year and whose
functions are not solely advisory;
(10) Candidates for state elective offices,
including candidates for election to the constitutional convention[,];
provided that candidates shall only be required to file initial disclosures;
(11) The administrator and assistant administrator
of the office of Hawaiian affairs; [and]
(12) The Hawaii unmanned aerial systems test site
chief operating officer[.]; and
(13) The individuals employed as or in the role
of executive officer, chief counsel, chief of policy and research, or hearings
officers of the public utilities commission.
(d) The financial disclosure statements of the following persons shall be public records and available for inspection and duplication:
(1) The governor, the lieutenant governor, the members of the legislature, candidates for and delegates to the constitutional convention, the trustees of the office of Hawaiian affairs, and candidates for state elective offices;
(2) The directors of the state departments and their deputies, regardless of the titles by which the foregoing persons are designated; provided that with respect to the department of the attorney general, the foregoing shall apply only to the attorney general and the first deputy attorney general;
(3) The administrative director of the State;
(4) The president, the vice presidents, the assistant vice presidents, the chancellors, members of the board of regents, and the provosts of the University of Hawaii;
(5) The members of the board of education and the superintendent, the deputy superintendent, the state librarian, and the deputy state librarian of the department of education;
(6) The administrative director and the deputy director of the courts;
(7) The administrator
and the assistant administrator of the office of Hawaiian affairs; [and]
(8) The members of the following state boards, commissions, and agencies:
(A) The board of directors of the agribusiness development corporation established under section 163D-3;
(B) The board of agriculture established under section 26-16;
(C) The state ethics commission established under section 84-21;
(D) The Hawaii community development authority established under section 206E-3;
(E) The Hawaiian homes commission established under the Hawaiian Homes Commission Act of 1920, as amended, and section 26-17;
(F) The board of directors of the Hawaii housing finance and development corporation established under section 201H-3;
(G) The board of land and natural resources established under section 171-4;
(H) The state land use commission established under section 205-1;
(I) The legacy land conservation commission established under section 173A-2.4;
(J) The natural area reserves system commission established under section 195-6;
(K) The board of directors of the natural energy laboratory of Hawaii authority established under section 227D-2;
(L) The board of directors of the Hawaii public housing authority established under section 356D‑3;
(M) The public utilities commission established under section 269-2; and
(N) The commission on
water resource management established under section 174C-7[.]; and
(9) The executive officer, chief counsel, chief of policy and research, and any individual employed as or in the role of a hearings officer of the public utilities commission."
SECTION 4. Section 269-2, Hawaii Revised Statutes, is amended as follows:
1. By amending subsection (a) to read:
"(a) There shall be a public utilities commission
of [three] five members, to be called commissioners, and who
shall be appointed in the manner prescribed in section 26-34, except as
otherwise provided in this section. All
members shall be appointed for terms of six years each, except that the terms
of the members first appointed shall be for two, four, and six years,
respectively, as designated by the governor at the time of appointment. A member who is a resident of a county
other than the city and county of Honolulu shall receive per diem compensation
for expenses, for days on which actual service is rendered, at an allowance
equal to the maximum federal employee rate for Hawaii, as established by the
United States Department of Defense, on the date that the member incurs the
expense. The governor shall
designate a member to be chairperson of the commission. Each member shall hold office until the
member's successor is appointed and [qualified.] confirmed by the
senate; provided that a vacancy occurring during a commissioner's term shall be
filled for the unexpired term thereof, subject to article V, section 6, of the
Constitution of the State of Hawaii. Section 26-34 shall not apply insofar as it
relates to the number of terms and consecutive number of years a member can
serve on the commission; provided that no member shall serve more than twelve
consecutive years.
In appointing commissioners, the
governor shall select persons who have had experience in accounting, business,
engineering, government, finance, law, economics, or other similar
fields[.]; provided that the commission shall:
(1) Be composed of
members who represent various disciplines and experiences and whose skills
reflect a diversity of professional knowledge and expertise;
(2) Include a
diverse representation of genders;
(3) Include at
least one member who is a resident of a county other than the city and county
of Honolulu; and
(4) Not include more than two commissioners who have a solely legal background.
The commissioners shall devote full time to their duties as members of the commission and no commissioner shall hold any other public office or other employment during the commissioner's term of office. No person owning any stock or bonds of any public utility corporation, or having any interest in, or deriving any remuneration from, any public utility shall be appointed a commissioner.
Each newly appointed commissioner
shall attend at least one pertinent educational or training seminar offered by
the National Association of Regulatory Utility Commissioners within the first
year of the commissioner's appointment. Each
commissioner may attend additional education and training seminars offered by
organizations such as the National Association of Regulatory Utility
Commissioners, educational institutions, or other organizations that involve
public utilities during the remainder of the commissioner's term of office to
further the commissioner's understanding of changes in the regulatory environment
or enhance the commissioner's ability to discharge the commissioner's duties. The public utilities commission shall make
training opportunities available to key staff to further the staff's abilities
to assist in the commission's regulatory functions."
2.
By amending subsection (e) to read:
"(e) Notwithstanding section 26-35(a)(5) to the
contrary, the commission's operational expenditures, such as the purchase of
supplies, equipment, furniture, dues and subscriptions, travel, consultant
services, and staff training, shall be determined by the
chairperson and may be delegated to the executive officer appointed and
employed pursuant to section 269-3; provided that such expenditures shall be
subject to all applicable procurement laws and procedures. In addition to the per diem permitted
under subsection (a), the commission's budget shall provide for travel expenses
equal to at least one round trip per week for any commissioner who is a
resident of a county other than the city and county of Honolulu; provided that
the chairperson of the commission shall not have the authority to withhold
basic travel requirements from any commissioner who is not a resident of the
city and county of Honolulu."
SECTION 5. Section 269-3, Hawaii Revised Statutes, is amended to read as follows:
"§269-3 Employment of assistants.
(a) The chairperson of the public
utilities commission may appoint and employ professional staff and other
assistants for the public utilities commission as the chairperson finds
necessary for the performance of the commission's functions and define their
powers and duties. Notwithstanding
section 26-35(a)(4) to the contrary and subject to applicable personnel laws,
the employment, appointment, applicable salary schedules, promotion, transfer,
demotion, discharge, and job descriptions of all officers and employees of or
under the jurisdiction of the commission shall be determined by the [chairperson]
commissioners and may be delegated by the chairperson to the
executive officer appointed and employed pursuant to
subsection [(b);] (e); provided that determinations concerning
personnel matters made by the [chairperson] commissioners or the
executive officer, as delegated by the chairperson, may be reviewed by the
director of commerce and consumer affairs for completeness and for compliance
and conformance with applicable administrative processes and procedures of the
department of commerce and consumer affairs. The chairperson may
appoint and, at pleasure, dismiss a chief administrator and attorneys as may be
necessary, and who shall be exempt from chapter 76. The chief counsel for the commission shall
report to the commissioners as a whole and shall not report to the executive officer. The chairperson may also appoint other staff,
including a fiscal officer and a personnel officer, with or without regard to
chapter 76.
(b)
Each commissioner may request and, upon request, shall be provided with
the services of a staff attorney and a researcher to assist the commissioner in
drafting, preparing revisions, or suggesting approaches to pending decisions
and orders. Attorney/client privilege
shall exist between the commissioner and the staff attorney until, and if, the
work product is shared with other commissioners. No commissioner shall request staff
assistance on non-commission-related work.
Staff attorneys and researchers provided pursuant to this section may be
selected from the commission's current staff allotment. The chairperson shall not refuse to provide a
commissioner with the services of a staff attorney or researcher pursuant to
this section.
(c)
Each commissioner, other than the chairperson, may appoint and employ a
clerical or support staff person to assist with that commissioner's
duties. Unless specifically appointed to
serve a single commissioner, staff appointed pursuant to this section shall
function independently and serve all commissioners as needed, and shall not be
required to serve a single commissioner.
(d)
The chief counsel shall devote full time to the chief counsel's duties to
the commission, and no person serving as chief counsel shall hold any other
public office or other employment while serving as chief counsel to the
commission. No person owning any stock
or bonds of any public utility corporation, or having any interest in or
deriving any remuneration from, any public utility shall serve as chief counsel
to the commission.
[(b)] (e) The chairperson of the commission shall
appoint, employ, and dismiss, at pleasure, an executive officer who shall be
responsible for managing the operations of the commission. The responsibilities of the executive officer
shall include management and recruitment of personnel, budget planning and
implementation, strategic planning and implementation, procurement and contract
administration, and implementation of administrative programs and
projects. The executive officer shall
not be involved in the development of policy or in any decision making for the
commission. The executive officer
shall be exempt from chapter 76.
[(c)] (f) Notwithstanding section 91-13, the commission
may consult with its assistants appointed under authority of this section in
any contested case or agency hearing concerning any issue of facts. Neither the commission nor any of its
assistants shall in such proceeding consult with any other person or party
except upon notice and an opportunity for all parties to participate, save to
the extent required for the disposition of ex parte matters authorized by law."
SECTION 6. (a) The chairperson of the public utilities commission, in conjunction with the other members of the commission, shall work with the department of commerce and consumer affairs and the department of human resources development to develop clearly defined duties and responsibilities for public utilities commission staff.
(b) The commission shall submit a report to the legislature, detailing the duties and responsibilities of public utilities commission staff described in subsection (a), no later than twenty days prior to the convening of the regular session of 2019.
SECTION 7. Beginning on January 16, 2019, the governor shall nominate the two additional commissioners, pursuant to section 269-2, Hawaii Revised Statutes, as amended by section 4 of this Act, to the public utilities commission. One of the new commissioners shall serve an initial term of four years, and the other new commissioner shall serve an initial term of six years, to provide for the expiration of terms on a staggered basis. By July 1, 2019, the public utilities commission shall be composed of five commissioners who shall reflect the requisite diversity of background, experience, gender, and residency, as required by section 269-2, Hawaii Revised Statutes, as amended by section 4 of this Act.
SECTION 8. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.
SECTION 9. This Act shall take effect on July 1, 2050; provided that section 4 of this Act shall take effect on January 1, 2019.
Report Title:
Public Utilities Commission; Commissioners; Structure; Organization; Per Diem; Teleconference; Videoconference; Financial Disclosure
Description:
Makes various updates to the structure and operations of the Public Utilities Commission to increase efficiency and effectiveness, including: establishing guiding principles; establishing docket review and decision-making processes; permitting teleconference and videoconference abilities; specifying senior staff members who must file public financial disclosures; beginning 1/1/2019, increasing the number of commissioners to 5; updating the composition of the Commission; specifying training requirements; clarifying commissioners' ability to appoint and employ staff; clarifying the roles of the executive officer and chief counsel; permitting neighbor island members to receive per diem compensation and compensation for travel expenses; and requiring the Commission to report to the Legislature regarding certain staff duties. Effective 7/1/2050. (SD2)
The summary description
of legislation appearing on this page is for informational purposes only and is
not legislation or evidence of legislative intent.
