(a) For purposes of this section, a “nonstate entity” means a company, corporation, partnership, firm, or other entity or group of entities, whether organized for profit or not for profit.

(b) The commission, by order, decision, motion, settlement, or other action, shall not establish a nonstate entity with any moneys other than those moneys that would otherwise belong to the public utility’s shareholders. A nonstate entity to be created with moneys from a public utility’s shareholders shall be subject to a 30-day review by the Joint Legislative Budget Committee prior to creation. This subdivision does not limit the authority of the commission to form an advisory committee or other body whose budget is subject to oversight by the commission and the Department of Finance.

Terms Used In California Public Utilities Code 854.5

  • Commission: means the Public Utilities Commission created by §. See California Public Utilities Code 20
  • commissioner: means a member of the commission. See California Public Utilities Code 20
  • Contract: A legal written agreement that becomes binding when signed.
  • Corporation: A legal entity owned by the holders of shares of stock that have been issued, and that can own, receive, and transfer property, and carry on business in its own name.
  • Oversight: Committee review of the activities of a Federal agency or program.
  • Partnership: A voluntary contract between two or more persons to pool some or all of their assets into a business, with the agreement that there will be a proportional sharing of profits and losses.
  • Settlement: Parties to a lawsuit resolve their difference without having a trial. Settlements often involve the payment of compensation by one party in satisfaction of the other party's claims.

(c) The commission shall not enter into a contract with a nonstate entity in which a person serves as an owner, director, or officer while serving as a commissioner. Any contract between the commission and a nonstate entity shall be void and cease to exist by operation of law, if a commissioner, who was a commissioner at the time the contract was awarded, entered into, or extended, becomes, on or after January 1, 2014, an owner, director, or officer of the nonstate entity while serving as a commissioner.

(d) Beginning June 1, 2014, a commissioner who acts as an owner, director, or officer of a nonstate entity that was established as a result of an order, decision, motion, settlement, or other action by the commission in which the commissioner participated, neglects his or her duty pursuant to § 1 of Article XII of the California Constitution, and as a result the commissioner may be removed pursuant to that section by the Legislature, two-thirds of the membership of each house concurring.

(Amended by Stats. 2014, Ch. 546, Sec. 1. (SB 434) Effective January 1, 2015.)

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