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| AB 68 | |
|---|---|
| Title | AB 68 |
| Enacted by | California State Legislature |
| Introduced by | Democratic legislator |
| Date introduced | 2021 |
| Status | Enacted |
AB 68 is a California law enacted to modify state-level statutes concerning wildfire response, utility liability, and emergency funding. The measure altered regulatory frameworks and fiscal mechanisms used by the California Public Utilities Commission, Governor of California, and local agencies such as county offices of emergency services. It aimed to address financial exposure for investor-owned utilities after high-profile events like the Camp Fire (2018) and policy debates involving entities such as Pacific Gas and Electric Company and Southern California Edison.
AB 68 emerged amid a sequence of legislative responses to catastrophic wildfires including the Camp Fire (2018), the Kincade Fire, and the Thomas Fire (2017), which prompted scrutiny of infrastructure maintenance by Pacific Gas and Electric Company, Southern California Edison, and San Diego Gas & Electric. In the wake of bankruptcy proceedings involving Pacific Gas and Electric Company, lawmakers in the California State Senate and California State Assembly pursued reforms parallel to earlier acts like AB 1054 (2019) and initiatives associated with the California Public Utilities Commission. Sponsors and committees drew on positions from stakeholders such as labor unions including the California Federation of Labor, environmental organizations like the Sierra Club, and consumer advocacy groups including the Utility Reform Network.
Hearings were convened at the State Capitol (Sacramento, California) where representatives from the Office of Emergency Services (California), investors such as CalPERS, and municipal entities including the City of San Francisco presented testimony. The bill’s fiscal analyses referenced reports by the Legislative Analyst's Office and projections from credit agencies interacting with Moody's Investors Service and S&P Global Ratings. Political negotiation involved the Governor of California's office and leadership in the California Democratic Party amid competing priorities from legislators aligned with the Republican Party (United States) minority.
AB 68 contains provisions addressing liability, wildfire fund capitalization, and utility operational standards. It amends statutes administered by the California Public Utilities Commission to adjust standards for inverse condemnation and the allocation of wildfire-related liabilities among utilities, insurers such as State Farm and Allstate, and ratepayers. The law created or modified funding mechanisms akin to a wildfire mitigation fund, with governance and capital contributions coordinated among investor-owned utilities including Pacific Gas and Electric Company, Southern California Edison, and San Diego Gas & Electric.
Specific statutory language revised emergency procurement procedures used by agencies like the California Office of Emergency Services and clarified interactions with federal partners such as the Federal Emergency Management Agency and the United States Department of Energy. The bill also stipulated reporting requirements to bodies including the California State Auditor and the Legislative Analyst's Office, and incorporated compliance timelines influenced by best practices from organizations like the National Fire Protection Association and the United States Forest Service. Labor and safety provisions referenced occupational standards enforced by the California Occupational Safety and Health Administration.
Implementation of AB 68 required regulatory action by the California Public Utilities Commission and administrative coordination with the Governor of California's office. Utilities began capital contributions and rate adjustments subject to approvals involving the California State Assembly budget committees and the California State Senate fiscal committee. The law set phased deadlines for fund capitalization, reporting, and program evaluations, with checkpoints aligned to fiscal cycles overseen by the Department of Finance (California).
Operational rolls-outs involved collaborations with county-level agencies such as the Los Angeles County Office of Emergency Management and municipal actors including the City of Oakland. Parallel federal-state coordination engaged the Federal Emergency Management Agency for disaster relief matching and the United States Department of Agriculture for vegetation management grant programs. Evaluations were scheduled to reference independent audits by entities akin to the California State Auditor and consultative reviews from national research organizations such as the RAND Corporation.
AB 68 provoked responses from a broad spectrum of stakeholders. Investor-owned utilities including Pacific Gas and Electric Company and Southern California Edison indicated that the law provided needed predictability for capital planning and operations. Consumer advocates such as The Utility Reform Network and municipal advocates including the City of San Jose raised concerns about potential cost transfers to ratepayers. Environmental organizations like the Sierra Club and community groups in regions affected by the Carr Fire and Woolsey Fire emphasized the need for stronger mitigation and accountability measures.
Labor organizations including the International Brotherhood of Electrical Workers and insurer groups represented by American Property Casualty Insurance Association weighed in on workforce and coverage implications. Financial markets, with actors like Moody's Investors Service and S&P Global Ratings, monitored the law’s effects on credit ratings for utilities and municipal issuers. Legal scholars and policy analysts from institutions such as the Public Policy Institute of California published assessments comparing the bill to precedents like AB 1054 (2019).
AB 68 prompted litigation focusing on constitutional claims and statutory interpretation, with lawsuits filed by parties including municipal entities, consumer groups, and utilities in state courts such as the Supreme Court of California and trial courts across counties like Los Angeles County. Challenges argued issues relating to inverse condemnation, takings jurisprudence as informed by the California Constitution, and compliance with mandates previously addressed by cases in the California Court of Appeal.
Judicial review considered administrative rulings by the California Public Utilities Commission and the scope of oversight by the Governor of California. Outcomes influenced subsequent regulatory orders and informed legislative refinements. Ongoing litigation referenced precedents from landmark state and federal cases involving utility liability and public safety obligations, with potential appeals implicating the United States Supreme Court in matters of federal constitutional law and interstate commerce considerations.