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Report: PUC has budget errors in the millions

5:41 PM, Jan 17, 2013   |    comments
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SACRAMENTO, CA - If you have a cellphone or receive utility bills for electricity, gas or cable, then you pay a laundry list of fees and surcharges that go to the state Public Utilities Commission.

A scathing new report by the California Department of Finance rips how the commission is tracking and ultimately spending those monies that go into 14 special funds that pay for things like phone services for disabled or deaf Californians.

"As both ratepayers and taxpayers, we want to make sure the amounts that we're paying in these rates are for their intended purposes ... that they can be accounted for properly, both revenues and expenditures at all times," Department of Finance Chief Auditor David Botelho said.

In the report:

  • Auditors found widespread budget errors.
  • General confusion and lack of knowledge led to the reporting of $400 million that actually didn't exist
  • Poor forecasting techniques led to less money collected than anticipated in a fund for subsidized telephone service for rural areas

The report cites one instance where a worker committed an $81 million typo.

The audit found that despite the discrepancies, the commission avoided going into the red in most cases. Gov. Jerry Brown has penciled in $200,000 more for the PUC to hire three more people to help keep the budget in order.

State Sen. Jerry Hill, D-San Mateo, has been pressuring the state PUC for years to change what he calls its complacent ways. Since the San Bruno pipeline explosion, he's criticized how lax the commission is in regulating utility companies and how cozy the PUC chairman is to the companies he regulates.

Now, after the finance department's report, the PUC has budget discrepancies.

"We don't know if they're going in the right place. We don't know if they're spending more than they should, less than they should," Hill said. "The problem again is it's our money they can't account for."

The PUC declined to be interviewed, but in a formal response to the Department of Finance, they basically agreed to almost every finding and will correct the problems.

By Nannette Miranda


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