Legislators don't question Calif. utilities chief on scathing audits

There's only one annual hearing where the state Senate reviews the overall performance of the California Public Utilities Commission, but it was too much of a time commitment for the agency's top man, Michael Peevey.

"I've got a plane to catch," Peevey told reporters Tuesday morning as he walked to the elevator before the Senate Energy, Utilities, and Communications Committee had even finished hearing from invited witnesses... much less the throng of citizens who showed up to speak.

But the longtime president of the state PUC did spend about 90 minutes in the hearing, a hearing where senators asked him about all sorts of things facing the agency -- except, it seemed, one of the more contentious issues.

Two weeks earlier,the state auditor released a report on the PUC's accounting practices that concludes the agency has not practiced "sufficient oversight" of billions of dollars utility companies deposit into 'balancing accounts' that are supposed to help justify rate increases -- relying, instead, on the more limited efforts of the agency's independent ratepayer advocates.

"The commission's reliance is misplaced," says the March 4 state audit (PDF), "as ratepayer advocates' reviews do not focus on all energy utility balancing accounts."

The recent audit comes after a number of other troubling questions about PUC's ability to track large sums of money. In March 2013, an Assembly budget subcommittee took the agency to task for a state Department of Finance audit that suggested large sums of money -- in one case, $275 million -- were not being closely tracked.

None of this was discussed by senators during Tuesday's hearing.

Lawmakers asked Peevey, who has been president of the PUC for almost 12 years under three different governors, questions ranging from whether phone companies had dropped landline service to the fate of the San Onofre nuclear power plant. But no questions about whether the quasi-independent agency is doing a good enough job minding its books.

Outside the hearing, Peevey dismissed the criticism.

"They didn't go that far," he said when asked about the audit's suggestion (which is in this summary) that ratepayers might not have enough protection from unfair increases in the bills. "What they (auditors) said is, 'You could do a better job.' And we accept the challenges they put forth, and will do a better job."

Peevey, who is married to state Sen. Carol Liu, D-La Canada Flintridge, has been personally been criticized in the past for gifts he's accepted. And on Tuesday speaking to reporters, he rejected another criticism: that he's not appeared at enough legislative hearings examining PUC issues and operations.

"I have never, never declined an invitation of the Legislature here," he said.

But at least one 2011 public agenda for a hearing in the state Assembly shows Peevey has been invited but has not testified. His last appearance before a legislative committee prior to Monday's hearing was in August 2012.

And what would Peevey say about the fact that questions about record keeping and other practices have happened during his long tenure at the helm of one of California's most powerful agencies?

"It probably says about my leadership, you know, nobody's perfect," he told reporters.


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