Justia Utilities Law Opinion Summaries

After the Regional Board issued a permit authorizing the County and certain cities (collectively, the Operators) to operate stormwater drainage systems, some of the Operators filed claims with the Commission seeking a determination that the state must reimburse them for the costs related to the trash receptacle and inspection requirements pursuant to article XIII B, section 6 of the California Constitution. After the Commission determined that the trash receptacle requirement is a reimbursable state mandate and that the inspection requirements are not, the state agencies filed a petition in the superior court for a writ of administrative mandamus to command the Commission to set aside its decision concerning the trash receptacle requirement. The local governments filed a cross-petition challenging the Commission's decision as to the inspection requirements. The superior court granted the state agencies' petition and denied the cross-petition as moot.The Court of Appeal held that, under Government Code section 17556, subdivision (d), when, as here, the state imposes on local governments a new program or higher level of service, the state is not required to provide subvention to the local government if the local government "has the authority to levy service charges, fees, or assessments sufficient to pay for the mandated program or increased level of service." The court reversed the superior court's judgment and agreed with the Commission that the local governments have the authority to levy service charges, fees, or assessments sufficient to pay for the inspection requirements, but not for the trash receptacle requirement. Therefore, the trash receptacle requirement requires subvention under section 6. View "Department of Finance v. Commission on State Mandates" on Justia Law

The Supreme Court affirmed in part and reversed and remanded in part orders entered by the North Carolina Utilities Commission addressing applications filed by Duke Energy Progress, LLC and Duke Energy Carolinas, LLC, holding that the Commission erred by rejecting an equitable sharing proposal without properly considering and making findings and conclusions concerning "all other material facts," as required by N.C. Gen. Stat. 62-133(d).Various interveners representing the utilities' consumers appealed the Commission's orders, challenging the lawfulness of the Commission's decisions concerning the extent to which the utilities were entitled to reflect costs associated with the storage and disposal of ash resulting from electricity production in coal-fired electric generating units in the cost of service used to set the utilities' North Carolina retail rates. The Supreme Court affirmed in part and reversed and remanded in part, holding that the Commission (1) did not err by allowing the inclusion of a majority to the utilities' coal ash costs in the cost of service used for establishing North Carolina retail rates and in increasing Duke Energy Carolinas' residential basic facilities charge; but (2) erred in rejecting an equitable sharing proposal without making the statutorily required findings and conclusions. View "State ex rel. Utilities Commission v. Stein" on Justia Law

This is one of several cases involving disputes between Malaga and the agencies involved in issuing and enforcing the permits necessary for Malaga to operate its waste treatment facility. In this case, Malaga wanted a wastewater discharge permit allowing it to discharge 0.85 million gallons per day (mgd) into certain disposal ponds. Malaga seeks to set aside the trial court's decision that the permit allowed a discharge of 0.85 mgd, arguing that the permit actually limited Malaga to discharging 0.49 mgd.After noting Malaga's aggressive approach, the Court of Appeal stated that it was unclear why litigation of this type was necessary when alternative administrative procedures could have resolved this issue in a faster and more efficient manner. The court concluded that the primary issue raised in this case is sufficiently important to warrant the use of the court's discretion to hear issues that are technically moot. The court held that the verification process included in Malaga's permit constituted an improper delegation of authority from the Water Quality Board to its executive officer. However, the court did not reach the parties' remaining issues, because those issues were not part of the trial court's final judgment, were not resolved in the first instance by the trial court, and are thus insufficiently developed to determine whether they could either support the trial court's judgment or require vacating the entire permit issued. Accordingly, the court reversed and remanded for further proceedings. View "Malaga County Water District v. Central Valley Regional Water Quality Control Board" on Justia Law

This is one of several cases involving disputes between Malaga and the agencies involved in issuing and enforcing the permits necessary for Malaga to operate its waste treatment facility. In this case, the Water Quality Board imposed penalties totaling $78,000 on Malaga for violating the water discharge requirements of its permit. Malaga contends that these penalties were inappropriately imposed for several reasons.The Court of Appeal agreed with Malaga that laches is a proper defense in administrative sanctions proceedings, and that the Water Quality Board utilized a void underground regulation when it issued the "Hearing Procedure for Administrative Civil Liability Complaint R5-2013-0527" (Hearing Procedure). The court explained that the first issue may only affect some of the penalties imposed by the Water Quality Board while the second may require a full rehearing. Therefore, the court reversed the trial court's order and remanded the matter to the trial court to determine whether a writ should issue based on one or both of Malaga's right to present a laches defense and the Water Quality Board's use of a void underground regulation via the Hearing Procedure. The court affirmed in all other respects. View "Malaga County Water District v. State Water Resources Control Board" on Justia Law

This is one of several cases involving disputes between Malaga and the agencies involved in issuing and enforcing the permits necessary for Malaga to operate its waste treatment facility. In 2016, the Water Quality Board issued an administrative civil liability complaint (ACL) to Malaga, which resulted in a civil liability penalty of more than $1 million. In proceedings before the trial court, Malaga prevailed on the theory that the hearing procedure document utilized to control the proceedings constituted an improper underground regulation.The Court of Appeal conclude that while portions of the hearing procedure constituted a void underground regulation, the trial court incorrectly remanded the matter without considering whether the use of those procedural regulations was harmless. Therefore, the court remanded the matter to the trial court to determine whether use of the void regulations was prejudicial and, if not, to resolve any further disputes in this matter. View "Malaga County Water District v. Central Valley Regional Water Quality Control Board" on Justia Law

The Supreme Court reversed the decision of the Public Utilities Commission of Ohio (PUCO) dismissing a complaint against a company that provided submetering services on the grounds that it did not have jurisdiction over the claims, holding that PUCO inappropriately applied a jurisdictional test of its own making.The PUCO's jurisdiction is provided by statute, and the PUCO generally has jurisdiction over any business that is a public utility. In dismissing the complaint in this case, the PUCO did not look to the statutory scheme to determine whether Nationwide Energy Partners, LLC, the submeterer, was a public utility. Instead, the PUCO used a test set forth in a 1992 PUCO order and recently modified by the PUCO to determine the extent of its jurisdiction. The Supreme Court reversed, holding (1) the PUCO's jurisdiction is established by statute, not an agency-created test; and (2) therefore, this case is remanded for the PUCO to determine whether it has jurisdiction based upon the jurisdictional statute. View "Wingo v. Nationwide Energy Partners, LLC" on Justia Law

A city-owned utility charges rates to its customers that do not "exceed the reasonable costs" of providing the utility service, but at the end of each fiscal year, the city routinely invokes its power under the city's charter to, via multiple steps, transfer the "surplus" in the utility's revenue fund—the amount left over after paying all "outstanding demands and liabilities" which, if transferred, will not have a "material negative impact" on the utility's "financial condition" (L.A. Charter, section 344(b))—to the city's general fund. Plaintiff filed suit against the city defendants, alleging that this routine practice by the city constitutes a "tax" that requires voter approval.The Court of Appeal affirmed the trial court's dismissal of the action challenging the practice as being an unlawful "tax." The court held that the city's alleged, ongoing practice of transferring a “surplus” from the DWP's revenue fund to the city's General Fund where, as also alleged, the rates charged by the DWP to its customers nevertheless do not exceed the costs of providing electricity to them, does not constitute a "tax" for three reasons. First, the practice does not satisfy the definition of a "tax" under the plain language of the California Constitution. Second, this conclusion is the one that best accords with the purpose behind the Constitution's restrictions on local taxation, namely to stop local governments from extracting even more revenue from California taxpayers. Third, Citizens for Fair REU Rates v. City of Redding (2018) 6 Cal.5th 1, strongly suggests that the city's yearly transfers of surplus funds do not constitute a "tax" when they do not cause the DWP's rates to exceed its costs of providing electricity. In this case, because plaintiff will be bound in any future amended complaints by the same verified allegations that doom his claims now, the court concluded that he cannot cure these defects by amendment and the trial court properly sustained the demurrer without leave to amend. View "Humphreville v. City of Los Angeles" on Justia Law

The Supreme Court reversed the orders of the Public Utilities Commission finding that intervening appellee Ohio Edison Company's 2017 earnings were not significantly excessive, holding that the Commission's decision to exclude revenue resulting from Ohio Edison's Distribution Modernization Rider (DMR) from the earnings test was not reasonable.Electric distribution utilities that opt of provide service under an electric security plan must undergo an annual earnings review by Commission. If the Commission finds that the plan resulted in significantly excessive earnings compared to similar companies, the utility must return the excess to its customers. The Office of the Ohio Consumers' Counsel appealed from the Commission's orders finding that Edison's 2017 earnings were not significantly excessive. The Supreme Court reversed, holding that the Commission's exclusion from the earnings test revenue resulting from the DMR, which was approved as part of Edison's electric security plan, was not reasonable. View "In re Determination of Existence of Significantly Excessive Earnings for 2017 Under the Electric Security Plan of Ohio Edison Co." on Justia Law

Environmental groups challenged the constitutionality of Public Resources Code section 25531, which limits judicial review of decisions by the Energy Resources Conservation and Development Commission on the siting of thermal power plants. Section 25531(a) provides that an Energy Commission siting decision is “subject to judicial review by the Supreme Court of California.” The plaintiffs contend this provision abridges the original jurisdiction of the superior courts and courts of appeal over mandate petitions, as conferred by California Constitution Article VI, section 10. Section 25531(b) provides that findings of fact in support of a Commission siting determination “are final,” allegedly violating the separation of powers doctrine by depriving courts of their essential power to review administrative agency findings (Cal. Const., Art. III, section 3; Art. VI, section 1).The court of appeal affirmed summary judgment in favor of the plaintiffs. The Article VI grant of original jurisdiction includes the superior courts and courts of appeal and may not be circumscribed by statute, absent some other constitutional provision. Legislative amendments to section 25531 have broken the once-tight link between the regulatory authority of the Public Utilities Commission (PUC) and Energy Commission power plant siting decisions, such that the plenary power Article XII grants the Legislature over PUC activities no longer authorizes section 25531(a). Section 25531(b) violates the judicial powers clause by preventing courts from reviewing whether substantial evidence supports the Commission’s factual findings. View "Communities for a Better Environment v. Energy Resources Conservation & Development Commission" on Justia Law

Proposition 218, the Right to Vote on Taxes Act, generally required local governments obtain voter approval prior to imposing taxes. Plaintiffs Jess Willard Mahon, Jr. and Allan Randall brought this certified class action against the City of San Diego (City) claiming that the City violated Proposition 218 by imposing an illegal tax to fund the City’s undergrounding program. Specifically, plaintiffs contended the City violated Proposition 218 through the adoption of an ordinance that amended a franchise agreement between the City and the San Diego Gas & Electric Company (SDG&E). The ordinance, together with a related memorandum of understanding, further specifies that part of the money to fund the undergrounding budget will be collected by SDG&E through a 3.53 percent surcharge on ratepayers in the City that will be remitted to the City for use on undergrounding (Undergrounding Surcharge). Plaintiffs claim that the surcharge is a tax. Plaintiffs further claim that the surcharge violates Proposition 218 because it was never approved by the electorate. Plaintiffs note that the City has imposed more than 200 million dollars in charges pursuant to the Undergrounding Surcharge during the class period. Through this action, plaintiffs seek a refund of those amounts, among other forms of relief. The City moved for summary judgment, which the trial court granted on two grounds: (1) the Undergrounding Surcharge constituted compensation for franchise rights and thus was not a tax; alternatively, (2) the Undergrounding Surcharge was a valid regulatory fee and not a tax. After review, the Court of Appeal concluded the trial court properly granted the City’s motion for summary on the ground that the Undergrounding Surcharge was compensation validly given in exchange for franchise rights and thus, was not a tax subject to voter approval. View "Mahon v. City of San Diego" on Justia Law