1. New Ex Parte Regulations and Lobbying Requirements at the CPUC
Mike Day and Brian Cragg
Goodin, MacBride, Squeri & Day, LLP
September 20, 2016

2. New Legislation on Communications with Commissioners
Senate Bill 215
Codifies requirements governing communications with CPUC Commissioners and key staff
Existing requirements are in the CPUC’s procedural rules and have the status of administrative regulations
States the Legislature’s “intent” that the Commission and those seeking to influence the Commission’s actions will be subject to “all applicable ethical standards, including ethical obligations applying to lobbyists under the Political Reform Act”

3. California Rules of Professional Conduct Related to Ex Parte Communications
Rule 3-210: “A member shall not advise the violation of any law, rule, or ruling of a tribunal unless the member believes in good faith that such law, rule, or ruling is invalid ”
Rule 5-300(B): “A member shall not directly or indirectly communicate with or argue to a judge or judicial officer upon the merits of a contested matter pending before such judge or judicial officer, except:
In open court; or
With the consent of all other counsel in such matter; or
In the presence of all other counsel in such matter; or
In writing with a copy thereof furnished to such other counsel; or
In ex parte matters.”

4. Definition of “Ex Parte Communication”
CPUC Rules
SB 215
“a written communication or oral communication that: (1) concerns any substantive issue in a formal proceeding, (2) takes place between an interested person and a decisionmaker, and (3) does not occur in a public hearing, workshop, or other public forum noticed by ruling or order in the proceeding, or on the record of the proceeding.”
“any oral or written communication between a decisionmaker and an interested person concerning any matter before the commission that the commission has not specified in its Rules of Practice and Procedure as being a procedural matter and that does not occur in a public hearing, workshop, or other public proceeding, or on the official record of the proceeding on the matter.” 

5. “Oral or Written Communication”
CPUC Rules
SB 215
“Written communication” includes letters, s or other electronic medium
“Oral communication” includes telephone and in-person communications
NOTE: Written ex parte communications must be served on all parties the same day the communication is sent to the decisionmaker
No definitions of type of communications
Written comments received from members of the public are part of the record but are not treated as evidence
Parties will have opportunity to respond to written comments included in the record

6. “Decisionmaker” CPUC Rules SB 215
“any Commissioner, the Chief Administrative Law Judge, any Assistant Chief Administrative Law Judge, the assigned Administrative Law Judge, or the Law and Motion Administrative Law Judge”
Advisors to Commissioners are not defined as “decisionmakers” but communications with them are subject to similar restrictions and reporting requirements
The CPUC shall adopt a definition that must include, but not be limited to, “each commissioner; the personal staff of a commissioner if the staff is acting in a policy or legal advisory capacity; the chief administrative law judge of the commission; and the administrative law judge assigned to the proceeding.”

7. “Interested Person” CPUC Rules SB 215
(1) any party to the proceeding or the party’s agents, employees, or compensated representatives;
(2) any person with a financial interest in a matter at issue before the Commission, or such person's agents, employees, or compensated representatives, or
(3) a representative acting on behalf of any formally organized civic, environmental, neighborhood, business, labor, trade, or similar association who intends to influence the decision of a Commission member on a matter before the Commission, even if that association is not a party to the proceeding.
(i) Any applicant, an agent, employee, or compensated representative of the applicant, or a participant in the proceeding on any matter before the commission.
(ii) Any person with a financial interest, in a matter before the commission, and such person’s agent, employee, or compensated representative. A person involved in issuing credit ratings or advising entities or persons who invest in the shares or operations of any party to a proceeding is a person with a financial interest.
(iii) A representative acting on behalf of any civic, environmental, neighborhood, business, labor, trade, or similar organization who intends to influence the decision of a commission member on a matter before the commission.
(iv) Other categories of individuals the commission, by rule, defines as an interested person.

8. “Substantive Issue” or “Not Procedural Matter”
CPUC Rules
SB 215
Ex parte communications include communications that concern “any substantive issue in a formal proceeding.”
“Communications regarding the schedule, location, or format for hearings, filing dates, identity of parties, and other such nonsubstantive information are procedural inquiries, not ex parte communications.”
Ex parte communications include “ any matter before the commission that the commission has not specified in its Rules of Practice and Procedure as being a procedural matter.”

9. Not Occurring in Public or on the Record
CPUC Rules
SB 215
Communications that occur “in a public hearing, workshop, or other public proceeding, or on the official record of the proceeding on the matter,” are not ex parte communications.
But special rules for communications occurring during conferences
Communications that occur “in a public hearing, workshop, or other public forum noticed by ruling or order in the proceeding, or on the record of the proceeding,” are not ex parte communications

10. SB 215: Special Rules for Conferences
Communications that occur at conferences, including communications in a private setting or during meals, entertainment events, and tours, and informal discussions among conference attendees, are subject to ex parte restrictions and reporting requirements
Ex parte communications in adjudication proceeding must be reported
Ex parte communications in ratesetting proceeding must be reported
Ex parte communications in quasi-legislative matters are subject to disclosure requirements developed by the CPUC

11. Banned Communications
CPUC Rules
SB 215
Adjudicatory proceedings
Periods related to Ratesetting Deliberative Meetings
Assignment or reassignment of a proceeding to a particular ALJ
Adjudication cases: exception for procedural discussions with assigned ALJ only
One-way ex parte communications from a decisionmaker to an interested person
Any communication between an interested person and a decisionmaker regarding which commissioner or ALJ may be assigned to a matter before the commission.
Periods related to Ratesetting Deliberative Meetings
In ratesetting matters, no individual ex parte meetings are allowed during 3 business days before the scheduled vote

12. Permitted Communications
CPUC Rules
SB 215
In quasi-legislation proceedings
On procedural matters
In ratesetting proceedings, all-party meetings
In ratesetting proceedings, if all parties given 3 days’ notice of meeting with decisionmaker
Equal time meetings (advisors are not decisionmakers)
In ratesetting proceedings, written communications served on all parties the same day
If no answer, response, or protest or if scoping memo determines no hearing is needed
Before proceeding is filed
In quasi-legislative proceedings
CPUC to adopt rules on disclosure of communications on Q-L proceedings occurring at conferences
In ratesetting proceedings
If all parties given 3 days’ notice and opportunity for equal time meeting (but no equal time requirement for meetings with advisors)
Notice not required if all parties are invited and given 3 days’ notice of meeting
Meetings with commissioners’ advisors
In ratesetting proceedings, written communications served on all parties the same day

13. Reporting Ex Parte Communications by Interested Persons
CPUC Rules
SB 215
File within 3 working days and include:
The date, time, and location of the communication, and whether it was oral, written, or a combination
The identities of each decisionmaker (or Commissioner's personal advisor) involved, the person initiating the communication, and any persons present
A description of the interested person's, but not the decisionmaker's, communication and its content and a copy of any written or other material used for or during the communication
File within 3 working days and include:
The date, time, and location of the communication, whether it was oral or written, or a combination, and the communication medium used
The identities of the decisionmaker, the person initiating the communication, and any other persons present
The topic of the communication, including applicable proceeding numbers
A substantive description of the interested person’s communication and its content
A copy of any written material or text used during the communication

14. Logging the Ex Parte Communication by the Decisionmaker
CPUC Rules
SB 215
No requirement (but CPUC started to log Oct. 2014)
Any decisionmaker participating in the communication must “promptly” file a notice including:
The date, time, and location of the communication, whether the communication was oral or written, or a combination, and the communication medium used
The identity of the interested person, the identity of the person initiating the communication, and the identities of any other persons present
The topic of the communication, including any applicable proceeding numbers
A brief description of the communication

15. Violations: Sanctions and Remedies
CPUC Rules
SB 215
Rule 8.3(j): “When the Commission determines that there has been a violation of this rule or of Rule 8.4 [reporting requirements], the Commission may impose penalties and sanctions, or make any other order, as it deems appropriate to ensure the integrity of the record and to protect the public interest.”
Rule 1.1—General ethical obligation to comply with California laws, respect the Commission and its members and ALJs, and never to mislead the Commission
Ex parte communication in adjudication:
File notice
No CPUC vote until notice filed and all parties have opportunity to respond
If communication not noticed until after vote, party may file petition to rescind or modify
Failure to file timely notice:
Decisionmaker shall refer matter to the General Counsel
Assigned Commissioner shall order submission of notice
Failure to file when ordered is a separate violation for each day of delay

16. Violations: Public Utilities Code
Existing Statutes
SB 215
Section : Violations of the ex parte statutes are subject to civil sanctions, including civil penalties or up to $50,000, adverse consequences in CPUC proceedings, or other appropriate orders
Each day violation not disclosed is a separate violation
Section : The Attorney General can bring an enforcement action against a Commissioner or CPUC employee for ex parte violations; court may grant civil penalties and disqualification from proceedings
Section 312: “The commission and each commissioner may issue all necessary process in proceedings for contempt, in like manner and to the same extent as courts of record.” 
Section 2110: Knowing violation of the Commission’s rules by a utility employee is a misdemeanor subject to a fine of up to $5,000 and up to a year in county jail
Section 2111: Knowing violation of the Commission’s rules by other persons is subject to fine of between $500 and $50,000
Section 2112: Knowing violation by other persons is a misdemeanor, subject to a fine of up to $1,000 fine or up to a year in county jail

17. The Ex Parte Rules Will Continue to Evolve
SB 215 requires the CPUC to revise some of its rules
CPUC will presumably conform its rules to the statute
But until rules are conformed and consistent, comply with the requirements of both the CPUC existing rules and the statutory requirements (if SB 215 is signed)
When in doubt, report

18. SB 215 does not change existing law re lobbying the CPUC
However, the statement of Legislative intent in Sec (h) ensures that there will be greater emphasis on enforcing the existing law related to lobbying of the CPUC.
Frankly, we have observed that many practitioners are likely skirting violation of the current rules by not registering as lobbyists.
CPUC and FPPC Staff will likely be exceedingly vigilant on registration, and can check who is visiting Commissioners and advisors by checking the on-line logs of ex parte visits.

19. Important Disclaimer
Please note that the Fair Political Practices Act and the FPPC Regulations are extremely complex and this presentation is only a summary designed to give you an idea if your firm’s activity may require registration.
You are strongly encouraged to review the FPPC website for additional information and if you believe you may need to register as a Lobbyist or Lobbying Firm, you should consult a law firm that specializes in political law and lobbying registration and reporting.
See the links on the final page of this presentation.

20. What Activity Qualifies as Lobbying?
Direct communication with a qualifying government official (Legislator, CPUC commissioner, ALJ, or advisor) for
the purpose of influencing Administrative Action or Legislative Action, and
the individual receives compensation for the direct communication to influence government action (above a specified amount).

21. An Important Exemption to the Lobbying Definition
A conversation by an individual (an employee of your company) with a qualifying official that takes place in the company of a registered lobbyist retained by your firm is not a direct communication that makes the individual a “lobbyist”.
The exemption also applies to a conversation involving a lobbyist of a trade association of which you (or your firm) are a member (such as IEP).
However, your lobbyist’s activity and payments are reportable.

22. What are the threshold levels of compensation for Registration?
For Lobbyists:
In-house lobbyists: Registration required if one third or more of their compensated time is spent in direct communication with California qualifying officials.
Contract Lobbyists: Registration required if they receive $2000 or more in a calendar month for direct communications with qualifying officials (Note: this is not $2000 per client, but $2000 for all direct communication activity).
Lobbying Firms:
A business entity that receives compensation for lobbying and at least one employee or partner, owner or officer is a lobbyist, or
A business entity that receives at least $5000 in a calendar quarter for lobbying even if no employee, partner, owner or officer is registered as a lobbyist.

23. Lobbyist Employers and Lobbying Coalitions
An individual, association, local government agency, or business entity that either:
directly employs an in house lobbyist to influence legislative or administrative action, or
retains a lobbying firm to engage in direct communication to influence legislative or administrative action.
Lobbying Coalitions:
Defined as a group of ten or more persons or entities formed primarily to influence legislative or administrative action whose members contribute to share the expenses of lobbying.
A person who only makes payments to a lobbying coalition is not a Lobbyist Employer.

24. But Don’t Forget $5000 Filers!
Note: A person must still register as a “$5000 Filer” if they directly or indirectly make payments of $5000 or more in any calendar quarter to influence legislative or administrative action.
There are special rules regarding what type of payments have to be included in the calculation of the $ However, payments to a Lobbying Coalition do count toward the limit.

25. What are the paperwork requirements for Lobbying?
To Start Lobbying, the Lobbyist, Lobbying Firm, and Lobbyist Employer must register with the Secretary of State (SOS) within 10 days after qualifying as a lobbyist, etc.
All three types of entities must file Quarterly Reports with the SOS by the end of the month following each calendar quarter.
If the payments or related expenses are over $2500, all filing must be done electronically.

26. What are the paperwork requirements for Lobbying?
The key forms are:
Form 601 Lobbying Registration Statement
Form 602 Lobbying Firm Activity Authorization
Form 603 Lobbyist Employer or Lobbying Coalition Registration Statement
Form 604 Lobbyist Certification Statement
Form 605 Amendment to Registration
Form 606 Notice of Termination (when the Lobbyist, Firm or Employer ceases all lobbying activity during a legislative session).
Form 615 Lobbyist Report
Form 625 Report of Lobbying Firm
Form 635 Report of Lobbyist Employer and Report of Lobbying Coalition
Form 645 Report of $5000 Filer

27. Reporting Payments for PUC Administrative Testimony
Lobbyist Employers and Coalitions must report quarterly Payments in Connection with Administrative Testimony at the CPUC.
These payments are limited to ratemaking and quasi-legislative proceedings.
The amounts reported must include legal fees to attorneys (other than lobbyists) for time spent appearing as counsel and preparing testimony. It must also include compensation to all witnesses for preparing to testify and for time spent testifying.
Payments for “grass-roots” lobbying to influence the PUC are also reportable.

28. Other Requirements
Every Lobbyist must take a lobbyist ethics course (conducted by the Assembly and Senate Ethics Committees) within 12 months of registration for the first time, and must take the course again if they have not taken the course within 12 months of renewing the certification.
Campaign Contributions must be reported (if they total over $100 per year).   
Home Hospitality: A lobbyist may not entertain a reportable official in their home. There is an exception when there is a relationship or association unrelated to the official’s position and the hospitality is related to that relationship. This was frequently abused in the past and the rules have been tightened recently.

29. Gift Restrictions
Lobbyists and lobbying firms may not make or act as an agent to give a gift, or “arrange” to give a gift in excess of $10 in a calendar month, nor make gifts aggregating more than $460 per calendar year.
There are many detailed rules regarding what constitutes a gift or arranging for a gift, including items such as tickets to events, meals, or attendance at functions.
Educational tours and informational material are not considered gifts.

30. Resources for Complying with the Fair Political Practices Act
The website of the Fair Political Practices Commission is a key resource for entities that are considering lobbying or registering to do so. You can find it at:
On the site under the tab “The Law” you can find links to the current version of the Fair Political Practices Act. See
You can also obtain the FPPC’s Regulations and decisions implementing the Act.
See
Under the tab “Learn” you can find a useful Lobbying Disclosure Manual, which contains the rules regarding lobbying, plus links to all the key forms necessary to commence lobbying and to file the necessary reports.
See
The FPPC will also accept written or electronic requests for advice or explanations about the statutes and regulations affecting lobbying. See