SECTION 1.
The Legislature finds and declares all of the following:(a) The Public Utilities Commission (commission) regulates 144 private, investor-owned public utilities that serve water (water utilities) to approximately 20 percent of the state’s population, or approximately six million people.
(b) Many of these water utilities serve water to impoverished communities with ratepayers who can ill afford to underwrite the accelerating costs of water treatment facilities and utility security measures.
(c) The commission has failed to conduct its rate cases with respect to water utilities in a timely manner, and has failed to act in accordance with the statutes and policy of the State of California in conducting its rate cases.
(d) This failure has caused water utilities to be unable to make needed upgrades to their infrastructure to ensure that their ratepayers receive water that meets water quality and water use efficiency standards, while covering their capital costs and making a reasonable return on their investment.
(e) The inability to cover capital costs and make a reasonable return on investment has caused water utilities to have their bond ratings downgraded, raising the cost to the water utilities of obtaining capital.
(f) In the spring of 2004, the commission issued an order that was determined to be unlawful and that jeopardized the water supply of the City of Folsom and caused a disruption in the city’s efforts to obtain needed financing, all without prior notice from the commission to the City of Folsom.
(g) The Legislature finds and declares that the commission is apparently incapable or unwilling to regulate water utilities in a timely manner, in accordance with state law and policy regarding the provision of water to the public.
(h) It is the intent of the Legislature to remove the commission’s authority over water utilities and transfer that authority to the Department of Water Resources.