Law:Division 5. Utilities Owned By Municipal Corporations (California)

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Contents

Chapter 1. Acquisition, Operation, And Sale Of Utilities

Article 1. Acquisition And Operation

Ca Codes (puc:10001-10014) Public Utilities Code Section 10001-10014



10001. "Public utility" as used in this article, means the supply of a municipal corporation alone or together with its inhabitants, or any portion thereof, with water, light, heat, power, sewage collection, treatment, or disposal for sanitary or drainage purposes, transportation of persons or property, means of communication, or means of promoting the public convenience.


10002. Any municipal corporation may acquire, construct, own, operate, or lease any public utility.


10003. The power to acquire and operate a public utility includes the power to complete, reconstruct, extend, change, enlarge, and repair a public utility acquired, constructed, owned, or operated by a municipality.

10004. For the purpose set forth in Sections 10002 and 10003 a municipal corporation may acquire, own, control, sell, or exchange lands, easements, licenses, and rights of every nature within or without its corporate limits, and may operate a public utility within or without the corporate limits when necessary to supply the municipality, or its inhabitants or any portion thereof, with the service desired.


10004.5. (a) Except as provided for in subdivision (b), any judicial action or proceeding against a municipal corporation that provides electric utility service, to attack, review, set aside, void, or annul an ordinance, resolution, or motion fixing or changing a rate or charge for an electric commodity or an electric service furnished by a municipal corporation and adopted on or after July 1, 2000, shall be commenced within 120 days of the effective date of that ordinance, resolution, or motion. (b) This section does not apply to any judicial action or proceeding filed pursuant to Chapter 13.7 (commencing with Section 54999) of Part 1 of Division 2 of Title 5 of the Government Code to protest or challenge a rate or charge or to seek the refund of a capital facilities fee if the notice and disclosure requirements of Section 54999.35 of the Government Code have not been followed.


10005. Whenever, in the operation of a utility, a municipality develops an excess of water, light, heat, or power, over and above the amount which is necessary for the use of the municipality and its inhabitants, or such portion thereof as the legislative body of the municipality determines is to be supplied therewith, the municipality may sell, lease, or distribute the excess outside of its corporate limits.


10006. No lease of a public utility is valid for a period of more than 15 years, and all such leases shall be let to the highest bidder at public auction.

10007. (a) Every public utility furnishing light, heat, or power shall expend no funds for advertising when such advertising encourages increased consumption of such services or commodities. (b) Nothing in this section shall prohibit a public utility furnishing light, heat, or power from expending funds for advertising which encourages the more efficient operation of the public utility or for advertising which encourages the more efficient use of light, heat, or power, the conservation of energy or natural resources, or presents accurate information on the economical purchase, maintenance, or use of any appliance or device using light, heat, or power.


10009. (a) This section applies if there is a landlord-tenant relationship between the residential occupants and the owner, manager, or operator of the dwelling. (b) If a public utility furnishes individually metered residential light, heat, water, or power to residential occupants in a detached single-family dwelling, a multiunit residential structure, mobilehome park, or a permanent residential structure in a labor camp, as defined in Section 17008 of the Health and Safety Code, and the owner, manager, or operator of the dwelling, structure, or park is the customer of record, the public utility shall make every good faith effort to inform the residential occupants, by means of written notice, when the account is in arrears, that service will be terminated in 10 days. The written notice shall further inform the residential occupants that they have the right to become customers of the public utility without being required to pay the amount due on the delinquent account. The notice shall be in English and in the languages listed in Section 1632 of the Civil Code. (c) The public utility is not required to make service available to the residential occupants unless each residential occupant agrees to the terms and conditions of service, and meets the requirements of law and the public utility's rules. However, if one or more of the residential occupants are willing and able to assume responsibility for the subsequent charges to the account to the satisfaction of the public utility, or if there is a physical means, legally available to the public utility, of selectively terminating service to those residential occupants who have not met the requirements of the public utility's rules, the public utility shall make service available to the residential occupants who have met those requirements. (d) If prior service for a period of time is a condition for establishing credit with the public utility, residence and proof of prompt payment of rent or other obligation acceptable to the public utility for that period of time is a satisfactory equivalent. (e) Any residential occupant who becomes a customer of the public utility pursuant to this section whose periodic payments, such as rental payments, include charges for residential light, heat, water, or power, where these charges are not separately stated, may deduct from the periodic payment each payment period all reasonable charges paid to the public utility for those services during the preceding payment period.


10009.1. (a) If a public utility furnishes light, heat, water, or power to residential occupants through a master meter in a multiunit residential structure, mobilehome park, or permanent residential structures in a labor camp, as defined in Section 17008 of the Health and Safety Code, and the owner, manager, or operator of the structure or park is listed by the public utility as the customer of record, the public utility shall make every good faith effort to inform the residential occupants, by means of a written notice posted on the door of each residential unit at least 15 days prior to termination, when the account is in arrears, that service will be terminated on a date specified in the notice. If it is not reasonable or practicable to post the notice on the door of each residential unit, the public utility shall post two copies of the notice in each accessible common area and at each point of access to the structure or structures. The notice shall further inform the residential occupants that they have the right to become utility customers, to whom the service will then be billed, without being required to pay the amount due on the delinquent account. The notice also shall specify, in plain language, what the residential occupants are required to do in order to prevent the termination of, or to reestablish service; the estimated monthly cost of service; the title, address, and telephone number of a representative of the public utility who can assist the residential occupants in continuing service; and the address and telephone number of a qualified legal services project, as defined in Section 6213 of the Business and Professions Code, which has been recommended by the local county bar association. The notice shall be in English and the languages listed in Section 1632 of the Civil Code. (b) The public utility is not required to make service available to the residential occupants unless each residential occupant or a representative of the residential occupants agrees to the terms and conditions of service, and meets the requirements of law and the public utility's rules. However, if one or more of the residential occupants or the representative of the residential occupants are willing and able to assume responsibility for subsequent charges to the account to the satisfaction of the public utility, or if there is a physical means, legally available to the public utility, of selectively terminating service to those residential occupants who have not met the requirements of the public utility's rules or for whom the representative of the residential occupants is not responsible, the public utility shall make service available to the residential occupants who have met those requirements or on whose behalf those requirements have been met. (c) If prior service for a period of time or other demonstration of credit worthiness is a condition for establishing credit with the public utility, residence and proof of prompt payment of rent or other credit obligation during that period of time acceptable to the public utility is a satisfactory equivalent. (d) Any residential occupant who becomes a customer of the public utility pursuant to this section whose periodic payments, such as rental payments, include charges for residential light, heat, water, or power, where these charges are not separately stated, may deduct from the periodic payment each payment period all reasonable charges paid to the public utility for those services during the preceding payment period. (e) If a public utility furnishes residential service subject to subdivision (a), the public utility may not terminate that service in any of the following situations: (1) During the pendency of an investigation by the public utility of a customer dispute or complaint. (2) If the customer has been granted an extension of the period for payment of a bill. (3) For an indebtedness owed by the customer to any other public agency or when the obligation represented by the delinquent account or other indebtedness was incurred with any public agency other than the public utility. (4) If a delinquent account relates to another property owned, managed, or operated by the customer. (5) If a public health or building officer certifies that termination would result in a significant threat to the health or safety of the residential occupants or the public. (f) Notwithstanding any other provision of law, and in addition to any other remedy provided by law, if the owner, manager, or operator, by any act or omission, directs, permits, or fails to prevent a termination of service while any residential unit is occupied, the residential occupant or the representative of the residential occupants may commence an action for the recovery of all of the following: (1) Reasonable costs and expenses incurred by the residential occupant or the representative of the residential occupants related to restoration of service. (2) Actual damages related to the termination of service. (3) Reasonable attorney's fees of the residential occupants, the representative of the residential occupants, or each of them, incurred in the enforcement of this section, including, but not limited to, enforcement of a lien. (g) Notwithstanding any other provision of law, and in addition to any other remedy provided by law, if the owner, manager, or operator, by any act or omission, directs, permits, or fails to prevent a termination of service while any residential unit receiving that service is occupied, the corporation may commence an action for the recovery of all of the following: (1) Delinquent charges accruing prior to the expiration of the notice prescribed by subdivision (a). (2) Reasonable costs incurred by the corporation related to the restoration of service. (3) Reasonable attorney's fees of the corporation incurred in the enforcement of this section or in the collection of delinquent charges, including, but not limited to, enforcement of a lien. If the court finds that the owner, manager, or operator has paid the amount in arrears prior to termination, the court shall allow no recovery of any charges, costs, damages, expenses, or fees under this subdivision from the owner, manager, or operator. An abstract of any money judgment entered pursuant to subdivision (f) or (g) of this section shall be recorded pursuant to Section 697.310 of the Code of Civil Procedure. (h) No termination of service subject to this section may be effected without compliance with this section, and any service wrongfully terminated shall be restored without charge to the residential occupants or customer for the restoration of the service. In the event of a wrongful termination by the public utility, the public utility shall, in addition, be liable to the residential occupants or customer for actual damages resulting from the termination and for the costs of enforcement of this section, including, but not limited to, reasonable attorney's fees, if the residential occupants or the representative of the residential occupants make a good faith effort to have the service continued without interruption. (i) The public utility shall adopt rules and regulations necessary to implement this section and shall liberally construe this section to accomplish its purpose of ensuring that service to residential occupants is not terminated due to nonpayment by the customer unless the public utility has made every reasonable effort to continue service to the residential occupants. The rules and regulations shall include, but are not limited to, guidelines for assistance to actual users in the enforcement of this section and requirements for the notice prescribed by subdivision (a), including, but not limited to, clear wording, large and boldface type, and comprehensive instructions to ensure full notice to the actual user. (j) Nothing in this section broadens or restricts any authority of a local agency that existed prior to January 1, 1989, to adopt an ordinance protecting a residential occupant from the involuntary termination of residential public utility service. (k) This section preempts any statute or ordinance permitting punitive damages against any owner, manager, or operator on account of an involuntary termination of residential public utility service or permitting the recovery of costs associated with the formation, maintenance, and termination of a tenants' association. (l) For purposes of this section, "representative of the residential occupants" does not include a tenants' association.


10009.6. (a) The decision of a public utility to require a new residential applicant to deposit a sum of money with the public utility prior to establishing an account and furnishing service shall be based solely upon the creditworthiness of the applicant as determined by the public utility. (b) No municipal corporation owning or operating a public utility furnishing services for residential use to a tenant under an account established by the tenant shall seek to recover any charges or penalties for the furnishing of services to, or for the tenant's residential use from, any subsequent tenant or the property owner due to nonpayment of charges by a previous tenant. For this purpose, the term "subsequent tenant" shall not include any adult person who lived at the residence during the period that the charges or penalties accrued. The municipal corporation may collect a deposit from the tenant service applicant prior to establishing an account for the tenant. The municipal corporation may not require that service to subsequent tenants be furnished on the account of the landlord or property owner unless the property owner voluntarily agrees to that requirement, nor may the municipal corporation refuse to furnish services to a tenant in the tenant's name based upon the nonpayment of charges by a previous tenant. (c) A public utility subject to this section may not demand or receive security in an amount that exceeds twice the estimated average periodic bill or three times the estimated average monthly bill. (d) In the event of tenant nonpayment of all or a portion of the bill, the deposit shall be applied to the final bill issued when service is terminated. (e) This section shall not apply to master-metered apartment buildings.


10010. (a) No public utility furnishing light, water, power, or heat may terminate residential service for nonpayment of a delinquent account unless the public utility first gives notice of the delinquency and impending termination, as provided in Section 10010.1. (b) No public utility shall terminate residential service for nonpayment in any of the following situations: (1) During the pendency of an investigation by the public utility of a customer dispute or complaint. (2) When a customer has been granted an extension of the period for payment of a bill. (3) On the certification of a licensed physician and surgeon that to do so will be life threatening to the customer and the customer is financially unable to pay for service within the normal payment period and is willing to enter into an amortization agreement with the public utility pursuant to subdivision (e) with respect to all charges that the customer is unable to pay prior to delinquency. (c) Any residential customer who has initiated a complaint or requested an investigation within five days of receiving the disputed bill, or who has, within 13 days of mailing of the notice required by subdivision (a), made a request for extension of the payment period of a bill asserted to be beyond the means of the customer to pay in full during the normal period for payment, shall be given an opportunity for review of the complaint, investigation, or request by a review manager of the public utility. The review shall include consideration of whether the customer shall be permitted to amortize the unpaid balance of the account over a reasonable period of time, not to exceed 12 months. No termination of service shall be effected for any customer complying with the amortization agreement, if the customer also keeps the account current as charges accrue in each subsequent billing period. (d) Any customer whose complaint or request for an investigation pursuant to subdivision (c) has resulted in an adverse determination by the public utility may appeal the determination to the governing body of the municipal corporation. Any subsequent appeal of the dispute or complaint to the governing body is not subject to this section. (e) Any customer meeting the requirements of paragraph (3) of subdivision (b) shall, upon request, be permitted to amortize, over a period not to exceed 12 months, the unpaid balance of any bill asserted to be beyond the means of the customer to pay within the normal period for payment.


10010.1. (a) No public utility furnishing light, heat, water, or power may terminate residential service on account of nonpayment of a delinquent account unless the public utility first gives notice of the delinquency and impending termination, at least 10 days prior to the proposed termination, by means of a notice mailed, postage prepaid, to the customer to whom the service is billed, not earlier than 19 days from the date of mailing the public utility's bill for services, and the 10-day period shall not commence until five days after the mailing of the notice. (b) Every public utility shall make a reasonable attempt to contact an adult person residing at the premises of the customer by telephone or personal contact, at least 24 hours prior to any termination of service, except that, whenever telephone or personal contact cannot be accomplished, the public utility shall give, by mail, in person, or by posting in a conspicuous location at the premises, a notice of termination of service, at least 48 hours prior to termination. (c) Every public utility shall make available to its residential customers who are 65 years of age or older, or who are dependent adults as defined in paragraph (1) of subdivision (b) of Section 15610 of the Welfare and Institutions Code, a third-party notification service, whereby the public utility will attempt to notify a person designated by the customer to receive notification when the customer's account is past due and subject to termination. The notification shall include information on what is required to prevent termination of service. The residential customer shall make a request for third-party notification on a form provided by the public utility, and shall include the written consent of the designated third party. The third-party notification does not obligate the third party to pay the overdue charges, nor shall it prevent or delay termination of service. (d) Every notice of termination of service pursuant to subdivision (a) shall include all of the following information: (1) The name and address of the customer whose account is delinquent. (2) The amount of the delinquency. (3) The date by which payment or arrangements for payment is required in order to avoid termination. (4) The procedure by which the customer may initiate a complaint or request an investigation concerning service or charges, except that, if the bill for service contains a description of that procedure, the notice pursuant to subdivision (a) is not required to contain that information. (5) The procedure by which the customer may request amortization of the unpaid charges. (6) The procedure for the customer to obtain information on the availability of financial assistance, including private, local, state, or federal sources, if applicable. (7) The telephone number of a representative of the public utility who can provide additional information or institute arrangements for payment. Every notice of termination of service pursuant to subdivision (b) shall include the items of information in paragraphs (1), (2), (3), (6), and (7). All written notices shall be in a clear and legible format. (e) If a residential customer fails to comply with an amortization agreement, the public utility shall not terminate service without giving notice to the customer at least 48 hours prior to termination of the conditions the customer is required to meet to avoid termination, but the notice does not entitle the customer to further investigation by the public utility. (f) No termination of service may be effected without compliance with this section. Any service wrongfully terminated shall be restored without charge for the restoration of service, and a notation thereof shall be mailed to the customer at his or her billing address.

10011. No electrical, gas, heat, or water public utility shall, by reason of delinquency in payment for any electric, gas, heat, or water services, cause cessation of any such services on any Saturday, Sunday, legal holiday, or at any time during which the business offices of the public utility are not open to the public.


10011.5. Whenever a business transaction of a public utility, as defined in Section 10001, furnishing electricity, gas, water service where the utility has 10,000 or more service connections, or telephone service is such that a personal appearance by a person is required by the utility and the person is unable to appear at the utility's place of business during the utility's usual business hours, then the utility shall provide a reasonable and convenient alternative to the person such as an appointment outside the utility' s usual business hours or allowing the person to conduct the transaction by telephone, mail, or both.


10012. Every public utility shall comply with Section 8029.5.


10013. (a) Subsequent to signing a contingent franchise, license, or service agreement with a local agency, a privatizer shall apply to the commission for a determination that the proposed privatization project is not a public utility within the meaning of Section 216 and is therefore exempt from commission regulation. When a privatizer files an application with the commission, the privatizer shall include the information the commission requires to make a determination in accordance with subdivisions (b), (c), (d), and (e). (b) (1) Not later than 60 calendar days after the privatizer submits its application to the commission, the commission shall determine in writing whether the application is complete and shall immediately transmit the determination to the privatizer. (2) If the application is determined not to be complete, the commission shall specify in writing those parts of the application which are incomplete and shall indicate the manner in which it can be made complete, including a list and thorough description of the specific information needed to complete the application. The applicant shall submit materials to the commission in response to the list and description. Upon resubmittal of the application, a new 60-calendar-day period shall begin, during which the commission shall determine the completeness of the application. (3) If the application is deemed complete, the commission may determine not later than 90 calendar days after the application is deemed complete that the privatization project is not a public utility within the meaning of Section 216 and is therefore exempt from commission regulation, if the commission finds that the application clearly complies with the criteria in subdivisions (d) and (e). If the commission does not make this finding, then it shall proceed under the schedule established in subdivision (c). (4) If the commission fails to make a written determination as to the completeness of the application within 60 calendar days after receipt of the original or resubmitted application, the application shall be deemed complete for purposes of this section. (c) Within 180 calendar days after the application is deemed complete, the commission shall determine whether the privatization project is a public utility within the meaning of Section 216 using the criteria in subdivisions (d) and (e). The commission may hold a hearing on the matter if the commission finds it to be necessary. No franchise, license, or service agreement between a privatizer and a local agency shall be entered into until the commission has either exempted the project or the 180-calendar-day period has expired, whichever comes first. Nothing in this section precludes a privatizer and the commission from mutually agreeing to a further extension of any time limit provided in this section. (d) The commission may determine that a privatization project is not a public utility within the meaning of Section 216, and is therefore exempt from commission regulation if it finds that the franchise, license, or service agreement both demonstrates that the local agency retains sufficient jurisdiction to protect the public interest and adequately addresses all aspects of the provision of service which would otherwise be subject to commission regulation. In making its determination, the commission shall determine whether the local agency has complied with Section 54253 of the Government Code. The decision of the commission shall be final and conclusive in the absence of any subsequent changes. (e) In making a determination pursuant to subdivision (c), the commission shall review the franchise, license, or service agreement to ensure that the agreement grants the local agency, at a minimum, all of the following: (1) Exclusive authority to establish all rates and rate changes charged to the public. (2) Approval over any proposal of the privatizer to provide new, additional, or alternative service to any other public or private entity or to change the service fee paid to the privatizer by the local agency. (3) Approval over the original design and construction of the project, including any changes in design, alterations, or additions to the project. (4) Approval over any changes in ownership of the party or parties subject to the franchise, license, or service agreement. (5) Authority to impose fines and penalties for noncompliance with any provision of the executed franchise, license, or service agreement, or for failure to provide the service within the time period agreed to in the franchise, license, or service agreement. (6) Authority to ensure that the facility is adequately maintained. (7) Adequate opportunity to monitor compliance with the agreement and to ensure the project will be operated to meet any applicable federal or state water quality standards or other applicable laws. (8) Adequate opportunity to amend the agreement in the event of unforeseen circumstances or contingencies, such as flood, earthquake, fire, or other natural disasters or federal tax law changes. (f) The commission may adopt whatever procedures it deems necessary to carry out the provisions of subdivisions (a), (b), (c), (d), and (e). The commission shall adopt regulations for reviewing any proposed changes to a contingent franchise, license, or service agreement to determine if the proposed changes could render the project a public utility within the meaning of Section 216. The commission shall charge each privatizer submitting an application pursuant to this section a fee which will be sufficient to defray the costs incurred in processing the application and rendering a decision upon it. (g) As used in this section, "privatization project" means any waste water or sewerage project that is owned and operated by a privatizer pursuant to a franchise, license, or service agreement with a local agency, or any agency of that local agency, pursuant to which services are supplied for the benefit of the local agency, its residents, or both, or any agency of the state. "Project" includes, but is not limited to, financing, designing, constructing, repairing, replacing, maintaining, and operating collector systems, pumping stations, treatment plants, and lateral interceptors, and outfall sewers. "Local agency" means any city, county, city and county, special district, or county service area. "Privatizer" means any corporation, partnership, or natural person, excluding municipal corporations, which owns and operates a wastewater or sewerage project pursuant to a franchise, license, or service agreement with a local agency. "Privatization project," as used in this section, includes the Santa Ana Watershed Project Authority's Arlington Basin Groundwater Desalter Project, which will treat groundwater contaminated by wastewater.


10014. The commission may enter into a contract with a local agency to provide any technical assistance needed to comply with Section 10013, if the contract includes provisions for the commission to be reimbursed for its estimated reasonable costs.


Article 2. Sale And Disposal

Ca Codes (puc:10051-10061) Public Utilities Code Section 10051-10061



10051. Any municipal corporation incorporated under the laws of this State may as provided in this article sell and dispose of any public utility that it owns.


10052. Whenever the legislative body of a municipal corporation by a resolution passed by two-thirds of all its members determines that the public interest and necessity demand that any public utility owned by the municipal corporation should be sold, it may at any subsequent meeting by a vote of two-thirds of all its members order the proposition of selling the public utility to be submitted to the qualified voters of the municipal corporation at an election held for that purpose.


10053. The ordinance calling the special election shall recite the object for which the election is to be held, the purpose for which the proceeds of the sale are proposed to be expended, the manner of holding the election, and the manner of voting for or against the sale of the public utility. In all particulars not recited in the ordinance the election shall be held as provided for by law for holding municipal elections in such municipality.


10054. The ordinance shall be published once a day for at least 12 days in a newspaper published at least six days a week in the municipality or at least once a week for two weeks in a newspaper published less than six days a week in the municipality. The insertion each week for two succeeding weeks is a sufficient publication in a newspaper published less than six days a week. The first publication of the ordinance shall be at least two weeks prior to the date mentioned in the ordinance for holding the election. In municipalities where no such newspaper is published the ordinance shall be posted in three public places therein for two succeeding weeks next before the day fixed for the election.


10055. The votes of two-thirds of all voters voting at the election are necessary to authorize the sale of the public utility described in the ordinance calling the election.


10056. The resolution and ordinance may provide for the sale of more than one public utility, but in such case the question of selling each public utility shall be separately stated in the ordinance and upon the election ballots.


10057. If the vote cast at the election is in favor of the sale of the public utility mentioned in the ordinance calling for the election, the legislative body of the municipal corporation shall immediately proceed to sell the public utility, and shall fix a date on which bids for the sale of the public utility will be received and the manner of filing bids. The legislative body shall cause notice of the sale to be published for at least two weeks next before the day fixed for receiving bids in the manner provided in Section 10054 for publication of the ordinance calling for the election. If no newspaper is published in the municipality, the notice shall be posted in three public places therein for two succeeding weeks next before the date fixed for receiving bids.


10058. At the date fixed for receiving bids the legislative body of the municipal corporation shall open and examine all bids received and may sell the public utility to the highest and best bidder therefor. If the bids received, in the opinion of the legislative body are inadequate or disproportionate to the value of the public utility the legislative body may reject all bids and may proceed to give new notice of the sale of the public utility in the manner provided in Section 10057.


10059. When a bid is accepted by the legislative body of the municipal corporation, the legislative body may by resolution authorize its mayor, or president of its board of trustees, or other chief executive officer, and its clerk to execute, acknowledge, and deliver on behalf of the municipal corporation, in its name and under its corporate seal, a deed conveying the public utility to the successful bidder upon receiving from him in cash the full amount of the bid and the promise of the bidder to continue to operate the public utility. The deed shall operate to convey to the successful bidder all of the municipality's right, title, interest, and estate in and to the public utility described in the deed.


10060. The proceeds of the sale of the public utility shall be placed in the municipal treasury and shall be applied exclusively for the purposes and objects mentioned in the ordinance calling the election for the sale of the public utility.


10061. (a) Notwithstanding Article 1 (commencing with Section 10001) and this article, a municipal corporation, by following the provisions of this section, may lease, sell or transfer all or part of a public utility owned and operated by it for furnishing water service. As used in this section, "municipal corporation," means a city or a city and county. (b) Any municipal corporation owning and operating a public utility for furnishing water service, a part of which or all of which public utility is operated and used for furnishing water service outside the boundaries of the municipal corporation, may lease, sell or transfer, for just compensation all or any part of the portion of the public utility located outside the boundaries of the municipal corporation to any other municipal corporation, public agency or public utility water corporation upon the terms and conditions agreed upon by the selling municipal corporation if, by resolution adopted by a majority of its legislative body, it has determined that the public utility, or portion thereof, is not necessary for supplying water to its own inhabitants and if the acquiring entity by resolution adopted by a majority of the members of its legislative body or board of directors has concurred in the lease, sale, or transfer and the terms and conditions thereof and if the acquiring entity will be bound to render water service to the persons formerly served through the system being sold on terms and conditions which are just and reasonable and which do not unreasonably discriminate against the customers of the acquired entity. (c) Any municipal corporation owning and operating a public utility for furnishing water service may sell or transfer, for just compensation, all or any part of the public utility located inside its municipal boundaries to any other municipal corporation, public agency, or public utility water corporation upon the terms and conditions agreed upon by the selling municipal corporation, if the sale or transfer is approved as follows: (1) The municipal corporation, by resolution adopted by a majority of its legislative body, has determined that the public utility, or portion thereof, is not necessary for supplying water to its own inhabitants, or that its inhabitants will be provided with equal or better service by the acquiring entity on terms that are just and reasonable and do not discriminate against the customers of the acquired entity; and orders the issue submitted to the qualified voters of the municipality at a special or general election held for that purpose. (2) The acquiring entity by resolution adopted by a majority of its legislative body or board of directors has concurred in the sale or transfer and in the terms and conditions thereof. (3) The sale or transfer is approved by a majority of all voters voting on the issue in the election held for that purpose. (4) The municipal corporation, public agency, or public utility water corporation proposing to acquire a municipal corporation public utility for furnishing water service shall disclose to the customers of the public water system to be acquired, not less than 30 days prior to the date of election for formal approval of the acquisition, a written statement which includes all of the following: (A) A summary of the price and terms of the proposed acquisition. (B) A comparison of the applicable water charges before and after the proposed acquisition. (C) The estimated savings to be achieved or additional costs expected to result, or both, from the proposed acquisition. (d) Subject to subdivision (e), a municipal corporation may lease a public utility furnishing water service by a resolution adopted by a majority of its legislative body and without lease term or other restrictions stated in any other provision of law. (e) A municipal corporation acting pursuant to subdivision (c) shall specify the manner of soliciting and filing, and the method of evaluating, proposals for the acquisition of the public utility. Upon receipt and staff evaluation of a proposal or proposals the municipal corporation, if it determines that the proposal or proposals are responsive, shall schedule a public hearing, and notice thereof shall be published in accordance with Section 6066 of the Government Code. At the hearing, the municipal corporation shall examine proposals received and staff recommendations, and without lease term or other restrictions, may lease, sell, or transfer, for just compensation, the public utility to the entity that the municipal corporation finds best qualified to continue to provide equal or better service to the customers of the system. If the resolution proposes a sale, the resolution shall place the question on the ballot at the next regularly scheduled election or at a special election called for that purpose. The municipal corporation may, in its sole discretion, reject all proposals. (f) Any agreement entered into before September 17, 1965, between municipal corporations for the lease, sale or transfer of all or any part of a public utility owned and operated by one of the municipal corporations and furnishing water service to the inhabitants of the municipal corporation to which the lease, sale or transfer is made is hereby validated.


Article 3. Rights Of Way

Ca Codes (puc:10101-10107) Public Utilities Code Section 10101-10107



10101. There is granted to every municipal corporation of the State the right to construct, operate, and maintain water and gas pipes, mains and conduits, electric light and power lines, telephone and telegraph lines, sewers and sewer mains, all with the necessary appurtenances, across, along, in, under, over, or upon any road, street, alley, avenue, or highway, and across, under, or over any railway, canal, ditch, or flume which the route of such works intersects, crosses, or runs along, in such manner as to afford security for life and property.

10102. A municipal corporation exercising its rights under this article shall restore the road, street, alley, avenue, highway, canal, ditch, or flume so used to its former state of usefulness as nearly as may be, and shall locate its use so as to interfere as little as possible with other existing uses of a road, street, alley, avenue, highway, canal, ditch, or flume.


10103. Before any municipal corporation uses any street, alley, avenue, or highway within any other municipal corporation, it shall request the municipal corporation in which the street, alley, avenue, or highway is situated to agree with it upon the location of the use and the terms and conditions to which the use shall be subject.


10104. If the two municipal corporations are unable to agree on the terms and conditions and location of a use within three months after a proposal to do so, the municipal corporation proposing to use a street, alley, avenue, or highway may bring an action in the superior court of the county in which the street, alley, avenue, or highway is situated against the other municipal corporation to have the terms and conditions and location determined. The superior court may determine and adjudicate the terms and conditions to which the use of the street, avenue, alley, or highway shall be subject, and the location thereof, and upon the making of the final judgment the municipal corporation desiring to do so may enter and use the street, alley, avenue, or highway upon the terms and conditions and at the location specified in the judgment.


10105. A grant of authority from or agreement with another municipality is not necessary in any case where the street, alley, avenue, or highway, or portion thereof, proposed to be used is a necessary or convenient part of the route of the proposed works and at the time construction was commenced or the plans adopted was located in unincorporated territory. This section is not applicable if the street, alley, avenue, or highway, or portion thereof, was located in incorporated territory prior to May 5, 1933.


10106. This article does not authorize the construction of any sanitary sewer within the territorial limits of any other municipality if the method of disposition of sewage thereform is by discharging it in the Pacific Ocean within one mile of the territorial limits of the other municipality or in any manner that may create a public nuisance.


10107. Nothing in this article limits in any respect the jurisdiction, powers, and duties vested by law in the Public Utilities Commission or, with respect to state highways, in the Department of Transportation. In the event of any conflict of jurisdiction, that of the Public Utilities Commission or the Department of Transportation, as the case may be, shall prevail.


Article 4. Rights In Public Lands And Waters

Ca Codes (puc:10151-10155) Public Utilities Code Section 10151-10155



10151. There is granted to every municipal corporation of the State the right of way for the location, construction, and maintenance of water works and works for the generation and distribution of electrical power, and for every necessary adjunct thereto, over any swamp, overflowed, or other public lands of the State not otherwise disposed of or in use, not in any case exceeding in length or width that which is necessary for the construction of the works or adjuncts, or for the protection thereof, and not in any case exceeding 100 feet in width along each side of the marginal limits of the works or adjuncts.

10152. There is granted to every municipal corporation of the State the right to take from any of the lands belonging to the State adjacent to the works of such corporation, all materials, such as wood, stone, and earth, naturally appurtenant thereto, which are necessary and convenient for the original construction of the works and adjuncts.


10153. There is granted to every municipal corporation of the State the right to take, in the manner provided by law, any waters belonging to the State, not otherwise disposed of, flowing or existing in any stream or lake intersected, crossed, or tapped by its water works, so far as is necessary to give such municipality and its inhabitants an ample supply of water for all municipal, domestic, irrigation, and manufacturing purposes.


10154. If the route or location of any works or adjuncts is changed so as not to cover or cross the lands selected under this article, or the use of the land selected is abandoned, the selected lands revert, and the title thereto is reinvested in the State or its grantees free from all such uses.


10155. When any selection of a right of way or land is made under this article by any municipal corporation, the legislative body thereof shall transmit to the State Lands Commission, State Controller, and recorder of the county in which the selected lands are situated, a verified plat of the lands selected, giving the extent thereof and the uses for which the lands are claimed or desired. If approved, the State Lands Commission shall so endorse the plat and issue to the corporation a permit to use the right of way and lands, unless on petition properly presented to a court of competent jurisdiction a review is had and such use prohibited.



Article 5. Permitted Use Of Improvements

Ca Codes (puc:10201-10213) Public Utilities Code Section 10201-10213



10201. This article is intended to provide a means of making the work and improvements herein mentioned useful and beneficial to the lands or property assessed to pay the costs and expenses of the construction thereof. The powers herein granted are supplemental to any other powers granted by law to any county or city, and this article does not repeal any other powers to use or utilize such work or improvements.


10202. When any legislative body elects to proceed under this article, the provisions hereof only shall apply and the limitations herein shall be followed.

10203. This article and all of its provisions shall be liberally construed to the end that the purposes hereof may be effective.


10204. "District," as used in this article, includes any district for which the legislative body of any county or city may make contracts.

10205. Whenever, under any street improvement act under which public work or improvements may be installed or constructed and the costs and expenses assessed in whole or in part against the lands or property benefited, there have been installed or constructed within any city or within the unincorporated territory of any county any wells, pumps, dams, reservoirs, storage tanks, channels, tunnels, conduits, pipes, hydrants, meters, or other appurtenances for supplying or distributing a domestic water supply, or all or any combinations thereof, and whenever there have been installed or constructed within any city or within the unincorporated territory of any county any mains, services, pipes, fittings, valves, regulators, governors, meters, drips, drains, tanks, ditches, tunnels, conduits, channels, or other appurtenances for supplying or distributing a domestic or industrial gas supply, or all or any combinations thereof, and no provision has been made for the maintenance, operation, and use of the work or improvement constructed, and the city owns no plant or system which can conveniently furnish water or gas, or the county owns no plant or system which can conveniently furnish the water or gas, the legislative body of the city or county, as the case may be, may grant permission to furnish water or gas therefor to any district, public corporation, mutual company, public utility company, private company, or individual.


10206. Before granting such permission the legislative body of the county or city shall find that the public interest, convenience, and necessity require that the work or improvement be used, that water or gas is necessary therefor, and that a certain, named, district, public corporation, mutual company, public utility company, private corporation, or individual can most conveniently furnish water or gas. Thereupon the county or city may grant to such district, public corporation, mutual company, public utility company, private corporation, or individual the right to attach his lines or system to the work or improvement, and to furnish water or gas through the work or improvement to all lands which were assessed to pay the costs and expenses of constructing the work or improvement.


10207. The permission shall be signed by the mayor or other chief executive of the city or by the chairman of the board of supervisors of a county, and by the person or authorized officers of the permittee.

10208. The permission shall state the time for which it is given, which shall not exceed two years, and describe the work or improvement for which it is given, and shall require the permittee to maintain the work or improvement during the term of the permission, and to make all necessary repairs thereto during such term, and to furnish gas or water, as the case may be, to all lands assessed to pay all or any part of the costs and expenses of the work or improvement.

10209. If any extensions of or additional installations for the work or improvement are necessary in order to serve all of the lands required to be served, the permittee shall not be obligated to make such extensions or additional installations, but shall permit any owner of such land to make the extensions and installations under reasonable regulations to be fixed by the city engineer or county surveyor, to attach them to the work or improvement, and to receive gas or water therefrom.


10210. The permission shall provide that the charge made by the permittee for gas or water shall not be greater than the charge therefor made by the permittee for such service elsewhere, and shall provide that the permittee shall pay a reasonable charge, to be determined by the legislative body granting the permission, for the use of the work or improvement. Such rental shall be paid to the treasurer of the county or city at least semiannually and placed in a special fund, which shall be used for the improvement or replacement of the work or improvement or any part thereof.


10211. The permission granted under this article to a private corporation or individual, not a public utility, and the furnishing of gas or water thereunder shall not be construed as a holding out or undertaking of such corporation or individual to serve any and all persons or as constituting the corporation or individual a public utility or as being any evidence thereof.


10212. The permission shall expressly reserve to the legislative body granting it the right to terminate it whenever the city or county can conveniently furnish gas or water. If so terminated, the county or city shall thereafter furnish such gas or water.


10213. The permission shall provide that if any district or public corporation is formed or extended, and if the district or public corporation can conveniently serve the territory with gas or water, any permission granted to any public utility, private corporation, or individual may be terminated by the legislative body. If permission is so terminated, the legislative body may grant permission to use the work or improvement and furnish gas or water to such district or public corporation in the manner and under the limitations provided in this article.


Article 6. Injury To Property

Ca Codes (puc:10251) Public Utilities Code Section 10251



10251. Any person who injures or destroys, through want of proper care, any necessary or useful facility or equipment of any municipal corporation is liable to the municipal corporation for all damages sustained thereby. The measure of damages to the facility or equipment injured or destroyed shall be the cost to repair or replace the property injured or destroyed including direct and allocated costs for labor, materials, supervision, supplies, tools, taxes, transportation, administrative and general expense and other indirect or overhead expenses, less credit, if any, for salvage. The specifying of the measure of damages for the facility or equipment shall not preclude the recovery of such other damages occasioned thereby as may be authorized by law.


Article 7. Financing Provisions

Ca Codes (puc:10301-10303) Public Utilities Code Section 10301-10303



10301. The Legislature finds and declares that financing the acquisition of privately owned facilities of an electrical or gas corporation by a municipal corporation not previously engaged in furnishing electricity or gas to customers on a regular and ongoing basis or by a redevelopment agency should be subject to the investigation and safeguards provided by this article in the public interest. The Legislature further finds and declares that the purpose of this article is to ensure that the power to acquire and operate these facilities is exercised in the wisest manner consistent with its grant and in the public interest.

10302. As used in this article: (a) "Electrical corporation" means an electrical corporation as defined in Section 218. (b) "Gas corporation" means a gas corporation as defined in Section 222. (c) "Redevelopment agency" means a redevelopment agency as defined in Section 34102 of the Health and Safety Code.


10303. The use of certificates of participation by a municipal corporation not previously engaged in furnishing electricity or gas to customers on a regular and ongoing basis, or the use of any evidence of indebtedness, including, but not limited to, certificates of participation, by a redevelopment agency, for the acquisition of all, or any portion, of the facilities of an electrical or gas corporation for the purpose of furnishing electricity or gas to customers is subject to an election held pursuant to Article 3 (commencing with Section 54380) of Chapter 6 of Part 1 of Division 2 of Title 5 of the Government Code, except that, in the case of any acquisition by a redevelopment agency, the term "qualified voters," as used in Section 54380 of the Government Code, means those persons who would be served by the facilities proposed to be acquired.


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