TWENTY-NINTH LEGISLATURE, 2017
STATE OF HAWAII
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.
The legislature further finds that due to these increasing responsibilities, it is essential that the structure and operations of the public utilities commission be updated to enable the commission to operate more efficiently. 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 at least two women, 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 perspectives and backgrounds in its deliberations and share decisions adopted by a group of people who more closely represent the population of our State.
The legislature notes that the commission is encouraged to engage in 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 summaries of cases and proposals of settlements are circulated for comment amongst all commissioners.
In keeping with the idea of a more collaborative commission, the legislature additionally 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 before the commission will enable commissioners to participate in public hearings 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 by:
(1) Establishing guiding principles of the commission;
(2) Allowing a commissioner to attend a public hearing by teleconference or videoconference in specific situations;
(3) 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;
(4) Requiring new commissioners to attend at least one meeting or training seminar offered by the National Association of Regulatory Utility Commissioners within the first year of the commissioner's appointment;
(5) Clarifying the ability of the commissioners to appoint and employ staff;
(6) Requiring the commissioners to work with the departments of commerce and consumer affairs and human resources development to develop clearly defined duties and responsibilities for public utilities commission staff and report the staff duties to the legislature; and
(7) Requiring a management audit to aid in the commission's transition to a better functioning entity.
SECTION 2. Chapter 269, Hawaii Revised Statutes, is amended by adding two 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 of energy delivery at all times;
(2) Manage resource adequacy and resiliency to ensure adequate power is available when needed;
(3) Maintain affordability for consumers; and
(4) Allow utilities to earn a reasonable rate of return on the utilities' investments.
§269- Hearing attendance by teleconference or video conference. (a) A commissioner may attend a public hearing of the public utilities commission by teleconference or videoconference to allow a commissioner residing on an island other than Oahu to attend a public hearing of the commission held on Oahu and a commissioner residing on the island of Oahu to attend a public hearing of the commission 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 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."
SECTION 3. 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,
incurred on the day or days 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 if
a vacancy is created due to the death or resignation of a commissioner, the
governor shall appoint an interim appointee who shall serve the remainder of
the term of the interim appointee's predecessor. 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 at least two members of the commission shall be women, at least
one member shall be a resident of a county other than the city and county of
Honolulu, and no more than two commissioners may be attorneys. 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
Newly appointed commissioners shall attend at least one meeting or training seminar offered by the National Association of Regulatory Utility Commissioners within the first year of the commissioner's appointment. Commissioners may attend additional education and training seminars offered by the National Association of Regulatory Utility Commissioners during the remainder of the commissioners' terms of office to further the commissioners' understanding of changes in the regulatory environment or enhance the commissioners' ability to discharge their duties."
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 269-2(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 4. 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 [
commissioners and may be delegated by the chairperson to the
executive officer appointed and employed
pursuant to subsection [ (b);] (c); 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, other than the chairperson, may appoint and employ two professional staff people, an attorney or executive assistant and 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.
(b)] (c) 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 for the commission.
The executive officer shall be exempt from chapter 76.
(c)] (d) 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 5. (a) The chairperson of the commission, in conjunction with the other members of the commission, shall work with the departments of commerce and consumer affairs and 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 2018.
SECTION 6. (a) The state auditor shall conduct a management audit to evaluate the efficiency and effectiveness of the public utilities commission and aid in the commission's transition to a better functioning entity. The management audit shall include but not be limited to:
(1) The general operations of the public utilities commission;
(2) The organizational structure of the public utilities commission, including personnel practices; and
(3) Any other matters that the auditor deems appropriate.
(b) The auditor shall report to the legislature with its findings and recommendations, including any proposed legislation, no later than twenty days prior to the convening of the regular session of 2018.
SECTION 7. The requirement that at least two members of the public utilities commission be women, at least one member be a resident of a county other than the city and county of Honolulu, and no more than two commissioners may be attorneys, pursuant to section 3 of this Act, shall apply to the next appointment to the commission following the effective date of this Act and thereafter.
SECTION 8. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.
SECTION 9. This Act shall take effect upon its approval.
Public Utilities Commission; Commissioners; Structure; Organization; Per Diem; Teleconference; Videoconference; Audit
Makes various updates to the structure and operations of the public utilities commission to increase efficiency and effectiveness, including: permitting teleconference and videoconference abilities; updating the composition of the commission; specifying training requirements; clarifying commissioners' ability to appoint and employ staff; permitting neighbor island members to receive per diem compensation and compensation for travel expenses; requiring the commission to report to the legislature regarding certain staff duties; and requiring a management audit of the commission.
The summary description of legislation appearing on this page is for informational purposes only and is not legislation or evidence of legislative intent.