The Public Utilities Commission

California’s Public Utilities Commission (CPUC) is one of the few state agencies that is established in the state’s constitution. Article 12 was added by Proposition 12 at the November 5, 1974 election. This article of the constitution contains the following nine sections:

Section 1 provides for the Public Utilities Commission that consists of 5 members appointed by the Governor and approved by the Senate, a majority of the membership concurring, for staggered 6-year terms. This section also provides that the Legislature may remove a member for incompetence, neglect of duty, or corruption, two thirds of the membership of each house concurring.

Section 2 states that that, subject to statute and due process, the commission may establish its own procedures.

Section 3 provides that private corporations and persons that own, operate, control, or manage a line, plant, or system for the transportation of people or property, the transmission of telephone and telegraph messages, or the production, generation, transmission, or furnishing of heat, light, water, power, storage, or wharfage directly or indirectly to or for the public, and common carriers, are public utilities subject to control by the Legislature. The Legislature may prescribe that additional classes of private corporations or other persons are public utilities. 

Section 4 provides that the commission may fix rates and establish rules for the transportation of passengers and property by transportation companies, prohibit discrimination, and award reparation for the exaction of unreasonable, excessive, or discriminatory charges. A transportation company may not raise a rate or incidental charge except after a showing to and a decision by the commission that the increase is justified, and this decision shall not be subject to judicial review except as to whether confiscation of property will result.  

Section 5 specifies that the Legislature has plenary power, unlimited by the other provisions of this constitution but consistent with this article, to confer additional authority and jurisdiction upon the commission, to establish the manner and scope of review of commission action in a court of record, and to enable it to fix just compensation for utility property taken by eminent domain.  

Section 6 provides that the commission may fix rates, establish rules, examine records, issue subpoenas, administer oaths, take testimony, punish for contempt, and prescribe a uniform system of accounts for all public utilities subject to its jurisdiction. 

Section 7 states that a transportation company may not grant free passes or discounts to anyone holding an office in this State and that the acceptance of a pass or discount by a public officer, other than a Public Utilities Commissioner, will cause a forfeiture of that office. A Public Utilities Commissioner may not hold an official relation to nor have a financial interest in a person or corporation subject to regulation by the commission.  

Section 8 specifies that a city, county, or other public body may not regulate matters over which the Legislature grants regulatory power to the Commission.

Section 9 provides that the provisions of this article restate all related provisions of the Constitution in effect immediately prior to the effective date of this amendment and make no substantive change.