Energy Plan Hits a Legal Hurdle

SACRAMENTO — Parts of Gov. Arnold Schwarzenegger’s ambitious plan to create a Cabinet-level energy agency headed by a statewide energy czar are unconstitutional, the Legislature’s legal counsel said in an opinion made public on the eve of a key hearing on the governor’s proposal.

Schwarzenegger’s plan to consolidate the work of a number of state commissions and departments into a new California Department of Energy would unconstitutionally infringe on the authority of the state Public Utilities Commission to approve the siting of electricity transmission lines, natural gas pipelines and natural gas storage facilities, according to an opinion by Legislative Counsel Diane F. Boyer-Vine.

Boyer-Vine issued the opinion at the request of state Senate President Don Perata (D-Oakland), an opponent of the Schwarzenegger plan.

Late Wednesday, Atty. Gen. Bill Lockyer submitted a similar legal opinion to the state Little Hoover Commission, a 13-member independent panel that promotes efficiency and effectiveness in state government programs.

The commission is scheduled to vote today on whether to recommend that the Legislature approve the governor’s plan.

Lockyer’s letter said no reorganization plan could transfer PUC rate-making functions to another agency. Provisions of the reorganization plan governing transmission lines and pipelines infringe on the commission’s rate-making powers, the attorney general’s letter said.

The Schwarzenegger administration, which says it needs new powers to head off the kind of rolling blackouts that plagued the state in 2000 and 2001, dismissed the legislative counsel’s findings.

“We would view this as overly restrictive,” said Joseph Desmond, Schwarzenegger’s appointee to be chairman of the existing California Energy Commission and a likely candidate to head the proposed energy department.

Schwarzenegger, who pledged in early 2004 to “blow up the boxes” on the state’s organization chart, has had little success in turning major portions of his massive California Performance Review into reality. He has managed to win approval from the Legislature for an overhaul of the state prison system. A more sweeping proposal to eliminate scores of regulatory boards and commissions was withdrawn after running into fierce opposition from a number of industry, professional and consumer groups.

The governor’s plan submitted to the Little Hoover Commission is far less broad than a reorganization proposal floated last year that would have folded every energy-related state agency -- including the PUC -- into the new cabinet-level department.

But the stripped-down version faces a potentially rough slog in the Democrat-controlled Legislature during this summer of partisan bickering over the state budget and a trio of contentious initiatives that will be before voters in a special election called for November by Schwarzenegger.

By law, either the state Senate or the Assembly can kill the governor’s plan with a majority vote of its members. The reorganization, however, would take effect if neither of the houses takes up the measure within 60 working days after its May 12 submission.